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Exhibit 10.23
EMPLOYMENT AGREEMENT
This Employment Agreement is executed this 24th day of March, 1997, by
and between XXXXX X. XXXXXXXXX (the "Executive"), and DTS MANAGEMENT, LLC, a
Georgia limited liability company (the "Company").
W I T N E S S E T H:
WHEREAS, the Company is engaged in the business of providing
management services to a group of affiliated entities substantially all of the
equity interests of which are currently owned directly or indirectly by Digital
Television Services, LLC, a Delaware limited liability company ("DTS") (DTS, the
Company and all entities controlled by DTS or the Company whether currently
existing or formed in the future are referred to collectively as the "Group");
WHEREAS, the Group is engaged in the business of providing
services delivered over direct broadcast satellite frequencies; and
WHEREAS, the Executive desires to provide services to the
Company and the Company desires to obtain the services of the Executive in
connection with the business of the Group;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants of the parties hereto, the parties hereby agree as follows:
1. Term. The initial term of this Agreement (the "Term") shall
commence effective as of the date hereof and shall end on March 23, 1998, unless
sooner terminated pursuant to the terms of this Agreement. This Agreement and
the Term shall be automatically renewed for successive 12 month renewal term(s),
provided that any renewal term may be terminated pursuant to the terms hereof.
2. Employment. During the Term, the Executive shall serve the
Company as its Chief Operating Officer or in such other comparable office or
offices of the Company or any other member of the Group as the Chief Executive
Officer of the Company (the "CEO") may designate from time to time, and shall,
except as otherwise specified by the CEO, be responsible, under the general
supervision of the CEO, for the overall management of the day-to-day operations
of the Company and the Group, including, but not limited to, the Company's sales
and marketing efforts, field operations and customer relations. The Executive
shall initially serve in such capacity on a part-time basis for a short period
(the duration of which shall be agreed upon with the Company's Chief Executive
Officer, but shall not exceed 6 weeks) and thereafter shall serve on a full-time
basis, and shall use his best effort to promote the business and interests of
the Company and the Group, to diligently, faithfully and to the best of his
abilities perform all tasks and duties reasonably assigned to him by the CEO, to
comply with the rules, regulations, policies and procedures of the Company, and
to act and comport himself at all times in the best
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interests of the Company and the Group. The Company contemplates that the
Executive's principal place of business will be in Roswell, Georgia.
3. Salary. During the short period at the start of the Term
when the Executive will be serving on a part-time basis, the Executive shall be
paid a prorated salary based upon days worked and the salary rate set forth in
the next sentence. Upon the expiration of such initial period and beginning with
the time upon which the Executive begins to serve on a full-time basis, the
Executive shall be paid a salary at the rate of $6,731 bi-weekly. The CEO and
the Board of Managers of the Company (the "Board") shall review the Executive
for a salary increase on each anniversary of the effective date of this
Agreement, provided that any such increases in salary shall be in the discretion
of the CEO and the Board.
4. Bonuses. The Company and the Executive anticipate that if
the financial and operating objectives of the Company are met as of the end of
each calendar year during the Term and the Executive is employed by the Company
or the Group on such date, the Company or the Group will pay to the Executive a
bonus of $50,000 at the time and on the terms determined by the Company (such
amount shall be prorated for calendar year 1997 based upon time worked during
the initial period during which the Executive worked on a part-time basis and
the portion of the Term occurring during 1997). If the Company materially
exceeds its financial and operating objectives as of the end of any calendar
year during the Term and the Executive is employed by the Company or the Group
on such date, the Board, in its sole discretion, will evaluate whether the
target bonus identified in the previous sentence should be increased.
5. Expenses. The Executive shall be reimbursed for any
reasonable out-of-pocket expenses which the Executive may incur in connection
with his services to the Company or the Group, consistent with the Company or
the Group's policies and procedures for reimbursement of expenses.
6. Benefits. During the Term, the Company shall make available
to the Executive life insurance, health and dental insurance, disability
insurance, vacation, participation in 401(k) plans, and other benefits to the
extent and upon the terms that are offered generally to employees of the Company
or the Group.
7. Termination. Anything herein to the contrary
notwithstanding, the Company may (a) terminate the employment of the Executive
under this Agreement at any time without notice for Cause (as defined below)
(except that the employment of Executive shall not be terminated under clause
(i) in the definition of Cause unless the Executive is given written notice that
the conduct in question constitutes grounds for termination and the Executive is
allowed at least 30 days to remedy the breach) and (b) terminate the employment
of the Executive under this Agreement at any time without Cause provided that
the Company shall provide written notice to the Executive at least fifteen (15)
days prior to the date of any such intended termination without Cause. Upon
termination of employment under this Section 7, the Company and the Group shall
be relieved of all further obligations under this Agreement except to the extent
set forth in Section 8 below. For the purposes of this Agreement, "Cause" shall
be defined to mean any circumstance
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where the Board determines that the Executive (i) has materially and
substantially breached his obligations under this Agreement, (ii) has been
convicted of a felony constituting a crime of moral turpitude (whether or not in
conjunction with the performance by the Executive of his duties under this
Agreement), or (iii) has through willful misconduct or gross negligence engaged
in an act or course of conduct that causes material injury to the Company or any
member of the Group.
8. Severance. If and only if the Company terminates the
employment of the Executive hereunder without Cause, the Executive shall
continue to receive his then current base salary for a total period of six (6)
months after the date of termination at the bi-weekly rate at which the
Executive is paid his base salary as of such date, which amount shall be paid
bi-weekly at the same time as the Company would have otherwise made payments to
the Executive hereunder.
9. Representation and Warranty. The Executive represents and
warrants to the Company that the execution and delivery by the Executive of this
Agreement and his performance of his obligations hereunder will not violate,
contravene or conflict with any employment agreement, consulting agreement,
confidentiality agreement, noncompetition agreement or other agreement or
contract to which he is a party or by which he may be bound.
10. Acknowledgements.
(a) The Group is in the business of marketing, selling and
distributing television services delivered over direct broadcast satellite
frequencies. As used in this Agreement, the term "Competing Business" shall mean
a person or entity engaged in any business which is the same or essentially the
same as the business of the Group and that conducts or transacts its business in
any county, city, or zip code in which the Group conducts or transacts its
business.
(b) The Group has expended, and expects to continue to expend,
substantial resources to develop business methods for marketing, distributing,
and selling services delivered over direct broadcast satellite frequencies.
Additionally, Executive has and shall receive experience and information
pertaining to the Group's business, sales and marketing methods and methods of
operation.
(c) Executive acknowledges the necessity of the restrictive
covenants set forth in this Agreement to protect the Group's legitimate
interests in the proprietary and confidential information of the Group and to
protect the customer relations and the goodwill with customers and suppliers
that the Group has established at substantial investment. Executive also
acknowledges and agrees that any violation of the restrictive covenants set
forth in this Agreement would bestow an unfair competitive advantage upon any
competing business to whom Executive might agree to render services or disclose
confidential information.
(d) Executive acknowledges that the Group's business is highly
specialized and during his employment with the Group, Executive has had and/or
will have access to the various proprietary information of the Group, including,
but not limited to, technical and nontechnical
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data; methods; techniques; processes; finances; actual or potential customer and
supplier information and lists; marketing strategies; margins, prices,
operations; existing and future services; and other financial, sales, marketing,
and operations information, whether written or otherwise ("Proprietary
Information"). Documents and information regarding these factors are highly
confidential and subject to efforts that are reasonable under the circumstances
to maintain their confidentiality. Furthermore, this Proprietary Information is
not generally known in the industry. The Executive acknowledges that such
Proprietary Information and trade secrets are owned and shall continue to be
owned solely by the Group.
(e) Executive's duties in the course of his employment with
the Group will include high level managerial functions relating to the various
aspects of the Group's business including the development and implementation of
business strategies and plans involving the areas of marketing, sales, pricing,
customer service and relations, business development and diversification.
(f) Executive's duties in the course of his employment with
the Group will include functions and duties which substantially affect the
Group's business in the cities, counties and zip codes which are included within
the National Rural Telecommunications Cooperative's systems within which the
Company or any member of the Group (as now or may in the future be constituted)
is or may be licensed to operate (the "Geographical Areas").
11. Agreement Not to Compete. Executive agrees that during his
employment by the Company and for a two (2) year period following the
termination of Executive's employment with the Company and any member of the
Group, whether such termination is voluntary or involuntary, with or without
Cause, Executive will not, without the prior written consent of the Company:
(a) Accept employment or affiliate with any Competing Business
performing duties the same as or substantially similar to the duties he provided
for the Company or any member of the Group as set forth in Sections 2 and 10(e)
("Duties") within any counties and/or zip codes in which, as of the date of this
Agreement, the Company and the Group (as it is constituted as of the date
hereof) actively conduct business; or
(b) Accept any position or affiliation with a Competing
Business, in which Executive would, in the regular and ordinary course of
business, of necessity be called upon, required, or expected to reveal, base
judgments on, or otherwise use Proprietary Information or Trade Secrets (as
hereinafter defined) that Executive received, obtained, or acquired during, or
as a consequence of, his employment with the Company. It is the intent of the
parties hereto that Executive shall be prohibited from using the training,
business goodwill, and Proprietary Information, including Trade Secrets, gained
by the Executive from the Company, to directly injure the Company in its ability
to carry on its business and compete within the time limit set forth in this
Section. Notwithstanding the above, this Section 11(b) shall only apply to
Competing Businesses which conduct business in the cities, counties, and zip
codes which Executive's duties substantially affected or as to which Executive
had access to confidential or Proprietary Information.
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12. Non-solicitation of Customers. The Executive agrees that
(except for services rendered for the Company's benefit) during his employment
with the Company and for a period of two (2) years immediately following the
termination of such employment relationship, whether such termination is
voluntary or involuntary or with or without Cause, the Executive shall not
himself or through others solicit, contact, or call upon any customer or
customer prospect of the Company or the Group, or any representative of any
customer or prospect of the Company or the Group, with a view toward sale or
providing of any service or product competitive with any service or product
sold, provided or under development by the Company or the Group during the
Executive's employment with the Company. Provided, however, the restrictions set
forth in this Section shall apply only to customers or prospects of the Company
or the Group, or representatives of the customers or prospects of the Company or
the Group, with which the Executive had contact during the Executive's
employment and engagement with the Company.
13. Non-disclosure of Proprietary and Confidential
Information. The Executive covenants and agrees that, for so long as the
Executive remains an employee of the Group and for a two (2) year period
following the Executive's termination, whether such termination is voluntary or
involuntary or with or without Cause, all Proprietary Information will be kept
in strict confidence and trust by the Executive. The Executive agrees that
during such time he will not, directly or indirectly, without the written
consent of the Company, divulge, use, appropriate, or disclose (except in
performing his obligations with the Group during his employment with the Group)
any Proprietary Information of the Group on his own behalf or on behalf of any
person, firm, partnership, association, corporation, business organization,
entity or enterprise.
14. Non-disclosure of Trade Secrets. The Executive agrees that
until Proprietary Information which constitutes a "Trade Secret" (as hereinafter
defined) becomes a part of the public domain by independent discovery or
development through no fault of the Executive, he will not, directly or
indirectly, use, appropriate, or disclose any trade secret (except in performing
his obligations to the Group during his employment with the Group) to benefit a
competitor, customer, individual, corporation, or other entity, without the
express, written permission of the Company. As used herein, the term "Trade
Secret" means information, including, but not limited to, technical or
non-technical data, formulas, patterns, compilations, programs, devices, methods
and techniques of doing business, drawings, designs, processes, financial data,
financial plans, product or service plans, and lists of actual or potential
customers or suppliers which: (i) derive economic value, actual or potential,
from not being generally known to, and not being readily ascertainable by proper
means by other persons who can obtain economic value from their disclosure or
use; and (ii) are the subjects of efforts that are reasonable under the
circumstances to maintain their secrecy.
15. Ownership of Intellectual Property. Any inventions,
patents, licenses, copyrights, computer software, computer programs, or other
intellectual property developed by the Executive as part of his performance of
services on behalf of the Company shall be the property of the Company, as the
case may be.
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16. Non-solicitation of Employees. The Executive agrees that
(except for the Group's benefit) during his employment with the Company or any
member of the Group and for a period of two (2) years immediately following the
termination of such employment relationship, whether such termination is
voluntary or involuntary or with or without Cause, the Executive shall not,
directly or indirectly, except with the written consent of the Company, solicit,
attempt to solicit, encourage, divert, or attempt to cause any employee or
prospective employees of the Group to terminate and/or leave the employment of
the Group for the Executive's own behalf or on behalf of any person, firm,
partnership, association, corporation, business organization, entity, or
enterprise.
17. Company Property. The Executive agrees that under no
circumstances shall the Executive, upon or after termination of his employment
whether such termination is voluntary or involuntary, with or without Cause,
remove from the Group's offices or premises any of the Group's books, business
records, documents, customer lists, employee lists, pricing information, trade
secrets, or other confidential information or copies of such information without
the express, written permission of the Group. The Executive agrees that he will
not use, cause to be used, or appropriate Group property to benefit a
competitor, customer individual (including himself), corporation, or other
entity (except in performing his obligations to the Group during his employment
with the Group), without the express, written permission of the Company.
18. Construction of Covenants. Each provision, Section, and
subsection of this Agreement is declared to be severable from every other
provision, Section, and subsection and constitutes a separate and distinct
covenant.
19. Survival of Certain Terms. This Agreement governs the
terms and conditions of employment. This Agreement shall terminate at
termination of employment, except that Sections 8 and 10-17 pertaining to
post-employment obligations shall remain in full force to the extent that such
Sections so provide.
20. Violations and Remedies. The Executive acknowledges that a
breach of any restrictive covenant, will irreparably and continually damage the
Group, for which money damages may not be adequate. Consequently, the Executive
agrees that in the event that he breaches or threatens to breach any of the
covenants, the Company and the Group shall be entitled to: (1) preliminary and
permanent injunctions to prevent the continuation of such harm; and (2) such
money damages as may be appropriate and provable.
21. Withholding. All payments required to be made by the
Company hereunder to the Executive shall be subject to the withholding of such
amounts relating to taxes as the Company may reasonably determine it should
withhold pursuant to any applicable law or regulation.
22. Injunctive Relief. The Company and the Executive agree
that, without limitation of the rights of the Company with respect to any other
breach of this Agreement, the harm to the company arising from any breach by the
Executive of Sections 10-17 of this
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Agreement could not adequately be compensated for by monetary damages, and
accordingly the Company or any other member of the Group shall, in addition to
any other remedies available to it at law or in equity, be entitled to obtain
preliminary and permanent injunctive relief against such breach.
23. Governing Law. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of Georgia,
without regard to the conflict of law provisions thereof.
24. Notices. All communications, notices and disclosures
required or permitted to be given under this Agreement shall be in writing and
shall be deemed to have been duly given upon receipt when delivered by hand, one
(1) day after dispatch when sent by certified first-class mail, postage prepaid,
return receipt requested, or by overnight courier maintaining records of
receipt; or on the date of dispatch when sent by facsimile transmission during
normal business hours with telephone confirmation of receipt. Notices shall be
addressed as follows or to such other address as the parties hereto shall
specify by written notice:
If to the Company:
DTS Management, LLC
000 Xxxxxxx Xxxxxx Xxxx
Xxxxxxxx X-000
Xxxxx X-000
Xxxxxxx, XX 00000
Attn: Board of Managers
Telephone: 000-000-0000
Facsimile: 000-000-0000
If to the Executive:
Xxxxx X. Xxxxxxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: ______________
25. Entire Agreement; Amendments. This Agreement constitutes
the entire agreement between the parties pertaining to the subject matter hereof
and supersedes all prior and contemporaneous agreements, understandings,
negotiations and discussions of the parties, whether oral or written, relating
to the subject matter hereof, and there are no warranties, representations or
other agreements between the parties in connection with the subject matter
hereof, except as specifically set forth herein or therein. No amendment,
supplement, modification, waiver or
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termination of this Agreement shall be binding unless executed in writing by the
party to be bound thereby. No waiver of any of the provisions of this Agreement
shall constitute a waiver of any other provision of this Agreement, whether or
not similar, nor shall such waiver constitute a continuing waiver unless
otherwise expressly provided thereby.
26. Miscellaneous. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their heirs, executors,
administrators, legal representatives, successors and assigns. The obligations
of the Executive under this Agreement may not be assigned. Nothing contained
herein is intended to create any rights enforceable by any person not a party
hereto or the permitted successor or assign thereof. If any term, provision,
Section, clause or part of this Agreement, or the application thereof under
certain circumstances, is held invalid or unenforceable for any reason, the
remainder of this Agreement, or the application of such term, provision,
Section, clause or part under other circumstances, shall not be affected thereby
and shall remain in effect to the greatest extent and scope that is valid and
enforceable. This Agreement may be executed in counterparts, all of which
together shall constitute a single instrument.
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IN WITNESS WHEREOF, the undersigned have set their hands as of
the day and year first above written.
DTS MANAGEMENT, LLC XXXXX X. XXXXXXXXX,
the Executive
By: /s/ Xxxxxxx Xxxxxxxx By: /s/ Xxxxx X. XxxXxxxxx
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