EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is entered into effective
as of February 14, 1996, between Chancellor Broadcasting Company, a
Delaware corporation ("Holdings"), Chancellor Radio Broadcasting Company, a
Delaware corporation (the "Broadcasting Subsidiary"), and Xxxx Xxxxxxxxx
(the "Employee").
W I T N E S S E T H:
WHEREAS, Holdings and the Broadcasting Subsidiary (collectively, the
"Company") are engaged in the ownership and operation of radio broadcast
stations KZLA-FM and KLAC-AM in the Los Angeles, California market; KSAN-
FM, KNEW-AM, KBGG-FM and KABL-AM in the San Francisco, California market;
KHYL-FM, KFBK-AM and KGBY-FM in the Sacramento, California market; and
KGGI-FM and KMEN-AM in the Riverside-San Bernardino, California market
(collectively, the "Stations");
WHEREAS, the Company desires to employ the Employee in an executive
capacity to assume supervisory responsibilities of the Stations;
WHEREAS, the Employee desires to be employed by the Company in said
capacity;
WHEREAS, the Employee is currently employed by the Company pursuant to
an Employment Agreement dated January 10, 1994, which the parties hereto
desire to supersede by the execution and delivery of this Agreement; and
WHEREAS, the parties hereto desire to set forth in writing the terms
and conditions of their understandings and agreements.
NOW THEREFORE, in consideration of the foregoing, of the mutual
promises contained herein and of other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound, do hereby agree as follows:
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1. TERM OF EMPLOYMENT. Unless earlier terminated in accordance
with the terms of this Agreement, the period of the Employee's employment
under this Agreement (the "Employment Term") shall commence on February 14,
1996 (the "Employment Date") and shall continue until February 14, 1998,
provided that the Employment Term shall automatically be renewed for
successive one-year terms unless the Company terminates this Agreement by
written notice to the Employee within 30 days prior to the expiration of
the then-current term.
2. DUTIES. The Employee shall serve as an Executive Vice
President of the Company and as Regional Manager of the Stations, with such
authority, duties, and responsibilities as are commensurate with such
positions, subject to the authority and direction of the Chief Executive
Officer and Board of Directors of the Company. During the term of this
Agreement the Employee shall devote his full business time and effort to
the diligent and faithful performance of his duties hereunder.
3. COMPENSATION.
3.1 SALARY. During the Employment Term, the Company shall pay
the Employee a base salary at an annual rate of $325,000 for a period from
the Employment Date through the first anniversary of the Employment Date
and at an annual rate of $342,000 thereafter. The Employee's base salary
shall be paid in accordance with the Company's regular payroll procedure,
but not less frequently than monthly. The Company shall be entitled to
withhold from all amounts payable to the Employee under this Agreement all
taxes and other sums required to be withheld by law. The Employee shall,
during the Employment Term, be entitled to participate in the employee
benefit plans of the Company in accordance with the Company's policies, as
changed from time to time.
3.2 BONUSES. During the Employment Term, the Company shall pay
the Employee an annual bonus of up to 50% of the Employee's Base Salary
(the "Broadcast Cash Flow Bonus") for each fiscal year of the Company
subsequent to 1995, based on the Stations achieving the broadcast cash flow
projections therefor outlined in Exhibit A attached hereto or otherwise
established therefor by the Board of Directors of the Company (the "BCF
Projections"), it being understood that the Employee shall be entitled to
receive within 20 days after the end of each fiscal quarter in which the
Stations achieve the BCF Projections therefor, as payment against the
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Broadcast Cash Flow Bonus for the fiscal year in which such fiscal quarter
occurred, an amount equaling one-eighth of the maximum possible Broadcast
Cash Flow Bonus for such fiscal year, with the remaining amount of the
Broadcast Cash Flow Bonus, if any, to be paid within 60 days after the end
of such fiscal year. The BCF Projections will be adjusted to reflect
acquisitions or dispositions of stations under the supervision of the
Employee, and the stations under the supervision of the Employee after any
such acquisition or disposition shall be deemed thereafter to be the
Stations for all purposes of this Agreement. In the event the Stations do
not achieve in any fiscal year the BCF Projections therefor but the
consolidated broadcast cash flow projection for the Company set forth in
Exhibit A or otherwise established for such year by the Board of Directors
of the Company (the "Consolidated BCF Projection") is achieved, the Chief
Executive Officer, subject to the authority of the Board Of Directors of
the Company, may elect to pay the Broadcast Cash Flow Bonus to the
Employee.
3.3 ADDITIONAL BENEFITS. (a) The Company will provide the
Employee with use of an automobile with a value of up to Sixty Thousand
Dollars ($60,000.00) and shall reimburse the Employee for taxes associated
with said automobile.
(b) The Employee shall be given three (3) weeks paid vacation
each calendar year, as well as personal leave, holiday leave and sick leave
in accordance with the general practice of the Company. Said vacation
shall not be taken for three (3) continuous weeks, but must be taken in
accordance with the Company's policies, as changed from time to time.
(c) The Company shall provide the Employee with a membership at
a tennis, fitness or business lunch club, or similar facility, the use of
which shall be for business purposes and the annual dues of which shall not
exceed Five Thousand Dollars ($5,000.00). The Company shall have the right
to approve such membership in advance and shall thereafter pay the cost and
expenses of such membership. The Employee's membership in said club shall
automatically terminate upon the termination of his employment for any
reason.
(d) The Employee shall be entitled to participate in the
Company's Stock Award Plan in accordance with the terms thereof and, at the
discretion of the Board of Directors of the Company, shall be granted
awards thereunder from time to time.
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4. TERMINATION OF EMPLOYMENT. The Employment Term under this
Agreement shall terminate immediately upon the first to occur of (i) his
voluntary resignation, (ii) his death, (iii) his disability which renders
him unable to perform his duties for more than 120 days in any 12-month
period, (iv) his termination for Cause (as hereinafter defined) or (v) the
sale of the Stations. The term "Cause" means (i) the Employee's engaging
in conduct which is materially damaging to the reputation of the Company or
which is inappropriate behavior for a senior management employee of the
Company, (ii) the Employee's inadequate performance of his duties or
failure to follow the directions of his superior officers or the Board of
Directors of the Company or (iii) the economic performance of the Stations
shall be materially unsatisfactory, all of the matters described in the
foregoing clauses (i) through (iii) to be conclusively determined by the
Company's Board of Directors acting in good faith.
5. NONCOMPETITION.
5.1 DURING EMPLOYMENT. The Employee agrees that during the
Employment Term, and for one year after the Employment Term terminates, he
shall not directly or indirectly accept employment with, be an owner or
investor in, serve as an advisor or consultant to, or otherwise participate
in any aspect of the radio broadcasting business (AM or FM) within a 50-
mile radius of the broadcast tower of any Station; PROVIDED, HOWEVER, that
nothing contained herein will be deemed to prohibit the Employee from
owning publicly-traded stock or other publicly-traded securities in which
the Employee's interest does not exceed 1% of the outstanding class of
securities or from owning a publicly-traded mutual fund or having an
interest in a publicly-traded trust owning such stock or securities in
excess of such level so long as the Employee has no direct control over
those investment decisions.
5.2 AFTER TERMINATION OF EMPLOYMENT. The Employee agrees that
if the Employment Term shall terminate for any reason, he shall not,
directly or indirectly, solicit any employee of the Company (or any of its
subsidiaries) for employment by any party other than the Company or its
subsidiaries for a period of three years.
5.3 CONFIDENTIAL INFORMATION AND TRADE SECRETS. The Employee
hereby acknowledges that he will have access to and become acquainted with
various trade secrets and proprietary information of the Company and its
subsidiaries not available to competitors of the Company or its
subsidiaries. The Employee covenants that he will not, directly or
indirectly, disclose or use such information during the Employment
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Term or thereafter, except as is necessary and appropriate in
connection with his employment by the Company or its subsidiaries;
PROVIDED, HOWEVER, that the Employee's obligations under this Section
5.3 shall end as to any information on such date as such information
becomes public other than by reason of the Employee's violation of this
Section 5.3.
5.4 REMEDIES. The Employee hereby acknowledges that damages are
not an adequate remedy for any breach by the Employee of Sections 5.1, 5.2,
or 5.3 and that the Company shall be entitled to injunctive relief (without
having to furnish any bond) in respect of any such breach, in addition to
such other rights and remedies as the Company may have at law or in equity.
In the event any of the covenants contained in Section 5.1, 5.2, or 5.3
shall be determined by any court of competent jurisdiction to be too broad
in scope or too long in duration, the parties intend that such covenant
shall not be void but shall instead be modified or reformed to the extent
deemed necessary by such court.
6. INDEMNITY. The Company shall indemnify the Employee, in his
capacity as an officer of the Company, pursuant to Article Ninth of
Holding's Second Restated Certificate of Incorporation, as in effect on the
Employment Date.
7. PAYMENTS UPON DEATH. In the event of the Employee's death
during the Employment Term, any accrued and unpaid compensation due the
Employee pursuant to Section 3 hereof at the time of his death shall be
paid to the Employee's estate.
8. GOVERNING LAW. The validity, interpretation and performance
of this Agreement shall be governed by the laws of the State of Texas.
9. NOTICE. Any written notice required to be given by one
party to the other party hereunder shall be deemed effective if mailed by
registered mail:
To the Company:
c/o Chancellor Broadcasting Company
00000 Xxxxx Xxxxxxx Xxxxxxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxx Xxxxxx
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With a copy to:
Xxxxxx X. Xxxxxxx
Weil, Gotshal & Xxxxxx LLP
000 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
To the Employee at:
Xxxx Xxxxxxxxx
0000 Xxxxxx Xxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
with a copy to:
Xxxxx Xxxxx
Xxxxx & Xxxxx
X.X. Xxx 000
Xxxxxxx, Xxxxxxx 00000
or such other address as may be stated in notice given as hereinbefore
provided.
10. SEVERABILITY. If any one or more of the provisions
contained in this Agreement shall be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality, or
unenforceability shall not affect any other provisions hereof.
11. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their personal
representatives, and, in the case of the Company, its successors and
assigns. The Company shall be a third party beneficiary of this Agreement.
12. ENTIRE AGREEMENT. This Agreement constitutes the full and
complete understanding and agreement of the parties, supersedes all prior
understandings and agreements as to terms and conditions of the employment
of the Employee and cannot be amended, changed, modified or terminated
without the consent, in writing, of the parties hereto.
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13. THE EMPLOYEE'S REPRESENTATION. The Employee hereby
represents and warrants to the Company that his execution, delivery, and
performance of this Agreement will not be a breach of any other agreement
to which the Employee is a party or by which he is bound.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the day and year first above written.
CHANCELLOR BROADCASTING COMPANY
By:
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President and
Chief Financial Officer
CHANCELLOR RADIO BROADCASTING
COMPANY
By:
---------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President and Chief
Financial Officer
EMPLOYEE:
XXXX XXXXXXXXX
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