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EXHIBIT 10.24
EMPLOYMENT AGREEMENT
Agreement, made this 21st day of June, 2000, between Crown Media
Holdings, Inc., a Delaware corporation with offices at 00000 Xxxxxxx Xxxxxxxxx,
Xxx Xxxxxxx, Xxxxxxxxxx 00000 or its permitted assigns ("Employer") and Xxxx
Xxxxx, 0000 Xxxxxxxxx Xxxxx, Xxx Xxxxxxx, XX. 00000 ("Employee"). This Agreement
will supercede the letter agreement covering Employee's employment by Odyssey
Holdings, L.L.C. ("Odyssey") dated April 26, 1999, and that agreement will be
deemed terminated as of the "Effective Date" below.
WITNESSETH:
WHEREAS, Employer desires to retain the services of Employee and
Employee desires to be employed by Employer upon the terms and conditions set
forth:
NOW, THEREFORE, in consideration of the covenants herein contained, the
parties hereto agree as follows:
1. Employment and Duties.
(a) Effective July 5, 2000 (the "Effective Date"), Employer
hereby employs Employee and Employee hereby agrees to serve as Executive Vice
President and Chief Operating Offer, Crown Media Holdings, Inc., reporting
directly to the Chief Executive Officer of Employer ("Crown CEO"). Employee
agrees to perform such services, as requested by Employer, as are consistent
with Employee's position. Employee shall use her best efforts to promote the
interests of Employer and shall devote her full business time, energy and skill
exclusively to the business and affairs of Employer during the "Term" (as "Term"
is defined in Paragraph 2 below).
(b) Employee's responsibilities as Chief Operating Officer
will include new business development, government relations and corporate public
relations for Employer as well as developing corporate "synergies" between
Employer's Crown Media, Inc. and Odyssey subsidiaries.
(c) During the course of Employee's employment hereunder,
Employer may be incorporating subsidiary production companies for the
development of specific programming, properties or projects. Employer shall have
the right to loan or make available, without
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additional compensation to Employee, Employee's services as an officer or
director of any subsidiary of Employer or company in common ownership with
Employer or to perform services for any programming, property or project owned
or controlled by Employer or any such entity, provided, that her duties as an
officer of any such entity shall be consistent with her duties hereunder.
Employee further agrees that all the terms of this Employment Agreement shall be
applicable to Employee's services for each such entity.
2. Term of Employment. The term of Employee's employment ("Term") with
Employer shall commence on the Effective Date and shall end on July 5, 2003
unless terminated earlier as is provided in Paragraph 8 of this Agreement or
extended by mutual agreement of the parties.
3. Compensation
(a) Salary. As compensation for Employee's services hereunder,
Employer shall pay to Employee a salary at the rate of $525,000 per year during
the first year of the Term, $550,000 per year during the second year of the Term
and $550,000 during the third year of the Term. Such salary shall be paid
biweekly, in arrears.
(b) Bonuses. At the end of each calendar year, during the
Term, Employee will be paid such bonus as Employer in its discretion determines,
provided that Employer shall pay Employee an annual bonus of no less than 20% of
her then annual salary rate for such year (pro rated for partial years,
including the final partial year of the Term). Bonus payments shall be made no
later than 30 days after end of calendar year end. If this Agreement and/or
Employee's employment with Employer or its related companies is not renewed at
the end of the Term, Employee's bonus for the final partial year of the Term
will be paid within 30 days of the end of the Term. Employee will also receive a
one time signing bonus of $100,000 within 15 days of the Effective Date of this
Agreement.
(c) Withholding. All payments of salary shall be made in
appropriate installments to conform with the regular payroll dates for salaried
personnel of Employer. Employer shall be entitled to deduct from each payment of
compensation to Employee such items as federal, state and local income taxes,
FICA, unemployment insurance and disability contributions, and such other
deductions as may be required by law.
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(d) Expenses. During the Term, Employer shall pay or reimburse
Employee on an accountable basis for all reasonable and necessary out-of-pocket
expenses for entertainment, travel (including first class commercial air travel,
or if first class air travel is not available, on a best available commercial
basis), meals, hotel accommodations (including an executive suite on trips where
business meetings in Employees rooms are required) and other expenditures
incurred by Employee in connection with Employee's services to Employer in
accordance with Employer's expense account policies for its executive personnel
or with the approval of the Chief Executive Officer of Employer.
(e) Fringe Benefits. During the Term, Employee shall be
entitled to receive the following fringe benefits: (i) an allowance of $950.00
per month for an automobile, (ii) group medical, dental, life and disability
insurance as per Employer policy, (iii) any other fringe benefits, including
paid vacation and maternity leave, on terms that are or may become available
generally to comparable executives of Employer and (iv) four (4) weeks annual
vacation.
(f) Conversion of SARs. Subject to the approval of the Board
of Directors of Employer, Employee's existing Share Appreciation Rights
("SARs"), which were granted to Employee as an employee of Odyssey, will be
converted to options to purchase not less than 100,000 shares of Employer's
common stock ("Crown Options") pursuant to Employer's stock option plan (the
"Plan"), using the same formula and under the same terms as have applied to
conversions of other SARs held by Crown Media Holdings, Inc. executives. The
following special conditions will apply to the conversion of the SARs: i) one
quarter of the Crown Options converted from the SARs will be deemed fully vested
as of the Effective Date of this Agreement; ii) the remaining Crown Options
converted from the SARs will vest in 3 equal annual installments on July 5,
2001, July 5, 2002 and July 5, 2003 and (iii) the option price per share of
stock purchasable under the Crown Options shall be the Fair Market Value (as
this term is defined in the Plan) on the Effective Date of the stock subject to
the Crown Options. If the Board of Directors of Employer does not approve the
conversion of the SARs on the foregoing terms, Employee will have the right to
terminate this Agreement by written notice given within 10 days of the date
Employee is advised in writing that such terms have not been approved.
Additional stock options may be granted each year in the sole discretion of the
Board of Directors of Employer.
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4. Place of Employment. During the Term, Employee shall be required to
perform Employee's duties at the principal office of Employer set forth above,
or at such other principal location in the Los Angeles metropolitan area (or
such other location as may be mutually agreeable to Employer and Employee).
Employee shall undertake all reasonable travel required by Employer in
connection with the performance of Employee's duties hereunder. It is
contemplated by the parties, however, that Employee's business travel will not
exceed 20% of her business days.
5. Confidentiality, Intellectual Property; Name and Likeness.
(a) Employee agrees that Employee will not during the Term or
thereafter divulge to anyone (other than Employer (and its executives,
representatives and employees who need to know such information) or any persons
designated by Employer) any knowledge or information of any type whatsoever
designated or treated as confidential by Employer relating to the business of
Employer or any of its subsidiaries or affiliates, including, without
limitation, all types of trade secrets, business strategies, marketing and
distribution plans as well as concrete proposals, plans, scripts, treatments and
formats described in subparagraph (b) below. Employee further agrees that
Employee will not disclose, publish or make use of any such knowledge or
information of a confidential nature (other than in the performance of
Employee's duties hereunder) without the prior written consent of Employer. This
provision does not apply to information which becomes available publicly without
the fault of Employee or information which Employee discloses in confidence to
her own privileged representatives or is required to disclose in legal
proceedings, provided Employee gives advance notice to the Chief Executive
Officer of Employer and an opportunity to Employer to resist such disclosure in
legal proceedings.
(b) During the Term, Employee will disclose to Employer all concrete
proposals, plans, scripts, treatments, and formats invented or developed by
Employee during the Term which relate directly or indirectly to the business of
Employer or any of its subsidiaries or affiliates including, without limitation,
any proposals and plans which may be copyrightable, trademarkable, patentable or
otherwise exploitable. Employee agrees that all such proposals, plans, scripts,
treatments, and formats are and will be the property of Employer. Employee
further agrees, at Employer's request, to do whatever is necessary or desirable
to secure for the Employer the rights to said proposals, plans, scripts,
treatments, and formats, whether by
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copyright, trademark, patent or otherwise and to assign, transfer and convey the
rights thereto to Employer at Employer's expense.
(c) Employer shall have the right in perpetuity to use Employee's name
reasonably in connection with credits for programming, properties and projects
for which Employee performs any services pursuant to this Agreement.
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6. Employee's Representations. Employee represents and warrants that:
(a) Employee has the right to enter into this Agreement and is
not subject to any contract, commitment, agreement, arrangement or restriction
of any kind which would prevent Employee from performing Employee's duties and
obligations hereunder;
(b) To the best of Employee's knowledge. Employee is not
subject to any undisclosed medical condition which might have a material effect
on Employee's ability to perform satisfactorily Employee's services hereunder.
7. Non-Competition; No Raid.
(a) During the Term, Employee shall not engage directly or
indirectly, whether as an employee, independent contractor, consultant, partner,
shareholder or otherwise, in a business or other endeavor which materially
interferes with any of her duties or obligations hereunder of which is directly
competitive with the business of the Employer or its subsidiaries, including but
not limited to the production. distribution or any other exploitation of
audiovisual television material (the "Other Business").
(b) Employee further agrees that during the Term and for a
period of one year thereafter, Employee will not employ, or knowingly attempt to
employ or assist anyone else to employ, any person who is, at that time, working
as an officer, policymaker or in high-level creative development or distribution
(including without limitation executive employees) for or rendering
substantially full-time services as such to Employer.
8. Termination.
(a) This Agreement may be terminated and the Term ended on
five (5) business days' written notice for any one of the following reasons
(except (i) in which case termination shall occur on the date of death):
(i) The death of Employee;
(ii) The physical or mental disability of Employee to
such an extent that Employee is unable to render services to Employer for a
period exceeding an aggregate of sixty (60) business days during any twelve
month period of the Term. For purposes of counting the aggregate of sixty (60)
business days, days properly designated by Employee as vacation days or
maternity leave shall not be counted;
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(iii) For "cause," which for purposes of this
Agreement shall be defined as:
(A) the use of drugs and/or alcohol which
interfere materially with Employee's performance of Employee's services under
this Agreement;
(B) Employee's conviction of any act which
constitutes a felony under federal, state or local laws or the law of any
foreign country;
(C) Employee's persistent failure after
written notice from the Crown CEO to perform, or Employee's persistent refusal
to perform after written notice from the Crown CEO, any of Employee's duties and
responsibilities pursuant to this Agreement; or
(D) Employee's dishonesty in non-trivial
financial dealings with or on behalf of Employer, its subsidiaries, affiliates
and parent corporation or in connection with performance of her duties
hereunder.
(b) Employer shall also have the right to terminate Employee
prior to the expiration of the Term in addition to pursuant to Paragraph 8(a)
above by providing Employee with not less than thirty (30) days' advance notice
in writing. In the event of a termination pursuant to this Paragraph 8(b), the
Employer shall pay to the Employee, commencing thirty (30) days after such
notice of termination, the remaining amounts described in Paragraph 3(a) and (b)
above for the balance of the Term at such time or times such payments would
otherwise be due. Employer shall have no further obligations to Employee
hereunder. Employee shall have no obligation for mitigation of the amounts paid
by Employer pursuant to this Paragraph 8(b). If Employer terminates Employee
under this Paragraph 8(b), Paragraph 7(a) shall not apply from the date of
termination.
(c) Employee shall have the right to terminate this Agreement,
upon thirty (30) days written notice, in the event all or substantially all of
the assets of Employer are sold and thereafter the content of the existing
programming services of Employer are changed or new programming services are
created with content which consists predominantly of graphically violent, sexual
or other similarly offensive material which departs substantially from the
existing programming standards of the Hallmark Channel .
(d) In the event that Employer terminates this Agreement due
to any of the reasons set forth in Paragraphs 8(a)(i), 8(a)(ii) or 8(a)(iii)(A,
B and D) above or Employee terminates this Agreement due to the reason set forth
in Paragraph 8(c) above, Employee shall be
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paid Employee's salary through the later of the expiration of the five (5)
business days period referred to in Paragraph 8(a) or the end of the month in
which the termination event occurs, after which Employer's obligation to pay
salary to Employee shall terminate. In the event that Employer terminates this
Agreement due to the reasons set forth in Paragraph 8(a)(iii)(C) above, Employee
shall be paid Employee's salary for a period of thirty (30) business days after
the notice of termination is given. After making the payments provided for in
this sub-paragraph (c), Employer shall have no further obligations to Employee
pursuant to this Agreement.
(e) Upon termination of this Agreement, Employee shall
promptly return all of Employer's property to Employer.
(f) Upon termination of Employee's employment for any reason,
Employee shall tender Employee's resignation from the Board of Directors of any
of Employer's subsidiaries or affiliates on which Employee is serving, and
Employer shall accept such resignation forthwith.
9. Assignment. This Agreement is a personal contract and, except as
specifically set forth herein, the rights, interests and obligations of Employee
herein may not be sold, transferred, assigned, pledged or hypothecated, although
she may assign or use as security payments due hereunder from Employer. The
rights and obligations of Employer hereunder shall bind in their entirety the
successors and assigns of Employer, although Employer shall remain fully liable
hereunder. As used in this Agreement, the term "successor" shall include any
person. firm, corporation or other business entity which at the time, whether by
merger, purchase or otherwise, acquires all or substantially all of the assets
or business of Employer.
10. Amendment; Captions. This Agreement contains the entire agreement
between the parties. It may not be changed orally, but only by agreement in
writing signed by the party against whom enforcement of any waiver, change,
modification or discharge is sought. Paragraph headings are for convenience of
reference only and shall not be considered a part of this Agreement. If any
clause in this Agreement is found to be unenforceable, illegal or contrary to
public policy, the parties agree that this Agreement shall remain in full force
and effect except for such clause.
11. Prior Agreements. This Agreement supersedes and terminates all
prior agreements between the parties relating to the subject matter herein
addressed, and sets out the full agreement between the parties concerning its
subject matter.
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12. Notices. Any notices or other communications required or permitted
hereunder shall be in writing and shall be deemed effective when delivered in
person or. if mailed, by registered or certified mail, return receipt requested,
in which case the notice shall be deemed effective on the date of deposit in the
mails, postage prepaid, addressed to Employee at the address for Employee
appearing in Employer's records and, in the case of Employer, addressed to its
Chief Executive Officer at the address first written above. Either party may
change the address to which notices are to be addressed by notice in writing
given to the other in accordance with the terms hereof.
13. Periods of Time. Whenever in this Agreement there is a period of
time specified for the giving of notices or the taking of action, the period
shall be calculated excluding the day on which the giver sends notice and
excluding the day on which action to be taken is actually taken.
14. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, and all of which, taken
together, shall constitute one instrument.
IN WITNESS WHEREOF, Employer has by its appropriate officer signed this
Agreement and Employee has signed this Agreement as of the day and year first
above written.
CROWN MEDIA HOLDINGS, INC.
/s/ XXXXX XXXXX
By Xxxxx Xxxxx
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Title President & CEO
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EMPLOYEE
/s/ Xxxx Xxxxx
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Xxxx Xxxxx
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