EXHIBIT 10.4
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT made as of April 25, 1997, between UC Television
Network Corp., a Delaware corporation (the "Company") and ▇▇▇▇▇ ▇▇▇▇▇
("Executive").
In consideration of the mutual covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Employment. The Company shall employ Executive, and Executive accepts
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employment with the Company, upon the terms and conditions set forth in this
Agreement for the period beginning on the date hereof and ending as provided in
paragraph 4 hereof (the "Employment Period").
2. Position and Duties.
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(a) During the Employment Period, Executive shall serve as Chief
Operating Officer of the Company and shall have the normal duties,
responsibilities and authority of the Chief Operating Officer, subject to the
direction of the Company's Chief Executive Officer, Vice-Chairman and board of
directors (the "Board"). Executive shall not be required by the Company to re-
locate his office to any location outside of the metropolitan New York, New York
area during the Employment Period and the Company shall provide an office for
Executive, with adequate secretarial assistance. Executive shall also receive a
private office suitable for his position.
(b) Executive shall report to the Board, the Chief Executive Officer
and Vice-Chairman of the Board, and Executive shall devote his full business
time, attention and skills to the business and affairs of the Company.
3. Base Salary and Benefits.
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(a) During the Employment Period, Executive's base salary shall be Two
Hundred Seventy-Five Thousand and No/100 Dollars ($275,000.00) per annum or such
higher rate as the Board may designate from time to time (the "Base Salary"),
which salary shall be payable semi-monthly in regular installments in accordance
with the Company's general payroll practices. Executive's Base Salary shall be
increased annually by that percentage, if any, by which the Consumer Price
Index, Urban Wage Earners, for the New York, New York Metropolitan area,
published by the United States Government for the month beginning on such April
1, exceeds such Index for the preceding April. The parties hereto hereby agree
that if the above index is not readily available, they will agree on a
reasonable equivalent thereof.
(b) The Company shall reimburse Executive for all reasonable expenses
incurred by him in the course of performing his duties under this Agreement
which are consistent with the Company's policies in effect from time to time
with respect
to travel, entertainment and other business expenses, subject to the Company's
requirements with respect to reporting and documentation of such expenses.
Executive shall be entitled to utilize first-class travel and first-class
accommodations. In addition, during the Employment Period, the Company shall
provide Executive with an automobile allowance of Five Hundred and No/100
Dollars ($500.00) per month for the monthly payments, maintenance and operating
expenses for any automobile used by Executive.
(c) In addition to the Base Salary and any Bonus payable to Executive
pursuant to this paragraph 3, Executive shall be entitled to participate in all
employee benefit plans and programs of the Company for which senior executive
officers of the Company are eligible, including, to the extent available or
established by the Company, any:
(i) family health insurance, disability insurance, and dental
insurance coverage;
(ii) 401(k), retirement or similar benefit plans;
(iii) stock option plans of the Company; and
(iv) Executive shall be entitled to twenty (20) business days
vacation per year and he shall be entitled to be absent from the office for one-
half days on each Friday from Memorial Day to Labor Day, provided such vacation
time does not interfere with the operations of the Company in the reasonable
judgement of the Executive.
(d) Executive owns the securities in the Company listed below:
25,000 shares of common stock
250,325 Options under 1990 Plan
199,633 Options under 1996 Plan
1,350,000 Nonqualified Options under outside Plans
Executive acknowledges that he is not entitled to or guaranteed any
other options, securities or warrants and that there is no requirement that the
Board authorize or provide any other anti-dilution rights to Executive in
connection with his current options or warrants, except as provided to all other
such option or warrant holders. Company acknowledges that all of Executive's
Options are presently fully vested, by reason of the change in control occurring
pursuant to the purchase agreement with U-C Holdings, L.L.C.
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4. Term.
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(a) The Employment Period shall commence on the release under that
certain Escrow Agreement, dated April 29, 1997, among the Company; U-C Holdings,
L.L.C. and LaSalle National Bank, as escrow agent (the "Escrow Agreement")
release of the Escrow Deposit in which the Company receives the purchase price
for 29,290,909 shares of its Common Stock pursuant to Section 5 of the Escrow
Agreement (the "Effective Date") and end on the fourth anniversary of the date
of this Agreement (the "Expiration Date"); provided, however, that the
Employment Period shall be automatically extended for one year on the Expiration
Date and at the end of each subsequent year of the Executive's employment (an
"Extension Period"; any such Extension Periods shall be included in the
definition of Employment Period) unless at least six (6) months prior to the
Expiration Date or the end of the then current Extension Period, either the
Company or the Executive shall give written notice to the other that this
Agreement shall not be so extended; and provided further that (i) the Employment
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Period shall terminate prior to such date upon Executive's permanent disability
or incapacity (determined as set forth below), resignation or death and (ii) the
Employment Period may be terminated by the Company at any time prior to such
date for Cause (as defined below) or without Cause. Permanent Disability or
incapacity shall occur if Executive misses sixty (60) consecutive days of work
and it is determined by an independent physician that such disability or
incapacity is permanent. If the purchase and sale of 29,090,909 shares to U-C
Holdings, L.L.C., is rescinded, this Agreement shall be of no further force of
effect.
(b) If Employment Period is terminated due to the Executive's death,
disability or incapacity, Executive shall be entitled to receive an aggregate
amount equal to twice his Base Salary. This amount shall be payable by the
Company in equal monthly installments over a period of two years following
termination of the Employment Period.
(c) If either Company or Executive terminates the Agreement for any
reason prior to the first anniversary of the Effective Date of this Agreement,
Executive shall be entitled to receive the sum of $500,000 in a lump sum payment
without set-offs except for cash advances owed to Company, within 10 days of
termination. If Company terminates this Agreement prior to such first
anniversary, Executive shall also receive his Base Salary for the remaining
period of time to such first anniversary paid in equal monthly installments.
This shall be Executive's sole severance upon such termination.
(d) After the first anniversary of this Agreement, if the Employment
Period is terminated by the Company without Cause, Executive shall be entitled
to receive an aggregate amount equal to his Base Salary payable for the
remainder of the Employment Period. This amount shall be payable by the Company
in equal monthly installments over the remainder of the Employment Period, so
long as Executive has not materially breached any of the provisions of
Paragraphs 5, 6 or 7 hereof.
(e) If the Employment Period is terminated by the Company for Cause,
upon the Executive's resignation after the first anniversary of this Agreement
or
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upon the expiration of the Employment Period after either party has given
notice of non-extension pursuant to Paragraph 4(a), Executive shall be entitled
to receive his Base Salary through the date of termination and shall not be
entitled to any other amounts hereunder.
(f) All of Executive's rights to fringe benefits hereunder (if any)
shall cease upon such termination; provided, however, that if Executive is
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terminated by the Company without Cause after the first anniversary the Company
shall permit Executive to continue to receive benefits under the Company's
health insurance policies to the extent permitted by such policies and
applicable law, provided that such insurance coverage can be maintained at a
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reasonable cost to the Company; and provided further, that the Company shall
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only maintain such insurance coverage until the earlier of (y) the end of the
period for which Executive is receiving severance payments pursuant to paragraph
4 hereof and (z) the date Executive accepts other employment.
(g) For purposes of this Agreement, "Cause" shall mean (i) the
conviction of a felony or a crime involving moral turpitude or the conviction of
any other crime involving dishonesty, disloyalty or fraud with respect to the
Company or Holdings, (ii) gross negligence or willful misconduct with respect to
the Company, (iii) any other material breach of this Agreement, or (iv) the
repeated failure to perform Executive's duties as directed by the Board, Chief
Executive Officer or Vice-Chairman; provided, however, that with respect to
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clause (ii), (iii) or (iv) above, if such failure or breach is capable of cure,
such failure or breach, as the case may be, shall not be deemed to constitute
Cause unless such failure or breach remains uncured after the expiration of 15
days after notice thereof to Executive.
(h) The Executive shall not be under a duty to mitigate the Company's
damages by seeking other employment, as a condition to receiving payments
specified herein.
5. Confidential Information. The Executive acknowledges that the
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information, observations and data obtained by him while employed by the Company
concerning the business or affairs of the Company ("Confidential Information")
are the property of the Company. Therefore, Executive agrees that, except in
the performance of duties for the Company, he shall not disclose to any
unauthorized person or use for his own account any Confidential Information
without prior written consent of the Board, except (i) to the extent that the
aforementioned matters become generally known to and available for use by the
public other than as a result of Executive's wrongful acts or omissions to act,
(ii) as necessary to comply with compulsory legal process, provided that
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Executive shall provide prior notice to the Company regarding such disclosure
and the Company, as applicable, shall have the right to contest such disclosure,
(iii) as necessary to counsel and other professional advisors retained by the
Executive, subject to the attorney/client privilege or a valid and binding non-
disclosure agreement between Executive and such professional and (iv)
disclosures of information obtained from a third party free of restrictions or
disclosure of information in Executive's possession prior to the date hereof
which was obtained from a source other than the Company or its predecessors.
Executive shall deliver to the Company at the termination of the
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Employment Period, all memoranda, notes, plans, records, reports, computer tapes
and software and other documents and data (and copies thereof) relating to
Confidential Information, Work Product or the business of the Company which he
may then possess or have under his control.
6. Inventions and Patents. Executive agrees that all ideas, concepts,
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marketing strategies, management techniques, product development, methods,
designs, analyses, drawings, reports, and all similar or related information
which relates to the Company's actual or anticipated business, research and
development or existing or future products or services relating to the Company's
business of College television networks and which are conceived, developed or
made by Executive while employed by the Company ("Work Product") belong to the
Company. Executive will promptly disclose such Work Product to the Board and
perform all actions reasonably requested by the Board (whether during or after
the Employment Period) to establish and confirm such ownership (including,
without limitation, assignments, consents, powers of attorney and other
instruments).
7. Non-Compete, Non-Solicitation.
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(a) Executive acknowledges that in the course of his employment with
the Company he will become familiar with the Company's trade secrets and with
other confidential information concerning the Company and that his services will
be of special, unique and extraordinary value to the Company. Therefore,
Executive agrees that, during the Employment Period and during any period in
which he is receiving payments pursuant to paragraph 4 or for which he has
received a lump sum payment pursuant to this Agreement (the period for payment
pursuant to Section 4(c) shall be deemed to be 18 months plus the period of time
of monthly payments, if any) or any subsequent agreement, and, if terminated for
Cause or by Executive's resignation before the Expiration Date or expiration on
the Expiration Date, for the lesser of: (i) two years after such termination or
(ii) if the Employment Period expires, one year from expiration (the "Non-
Compete Period"), he shall not directly or indirectly own, manage, control,
participate in, consult with, render services for, or in any manner engage in
any business competing with the businesses of the Company as such businesses
exist or are in process on the date of the termination of Executive's
employment, within any geographical area in which the Company engages or plans
to engage in such businesses, including without limitation, hold a significant
management position with any information or entertainment network which markets
to limited population segments, where the Company operates (including markets in
which, during the Employment Period, the Company has executed or was in the
process of negotiating a written agreement to acquire such an operator).
Notwithstanding the foregoing, nothing herein shall prohibit Executive from (i)
continuing his ownership, management and/or control of any business in which and
to the extent which he held such interests prior to the Non-Compete Period, or
(ii) being a passive owner of not more than 5% of the outstanding stock of any
class of a company which is publicly traded, so long as Executive has no active
participation in the management or the business of such company; or (iii) being
involved, in any manner or capacity, in the general television cable, "DBS," or
radio broadcast industry, as contrasted with television transmission to a
specialized segments of the market such as university,
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school or industrial locations; or current production, record production or
distribution; or movie, television and theatrical productions.
(b) During the Employment Period and for eighteen months thereafter,
Executive shall not directly or indirectly through another entity (i) solicit,
encourage, interview, entice, discuss with or induce or attempt to induce any
employee of the Company to leave the employ of the Company, or in any way
interfere with the relationship between the Company and any employee thereof,
(ii) hire any person who was an employee of the Company at any time during the
Employment Period or (iii) induce or attempt to induce or attempt to induce any
customer, supplier, licensee or other business relation of the Company to cease
doing business with the Company, or in any way interfere with the relationship
between any such customer, supplier, licensee or business relation and the
Company.
8. Enforcement. If, at the time of enforcement of paragraphs 5, 6 or 7
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of this Agreement, a court holds that the restrictions stated herein are
unreasonable under circumstances then existing, the parities hereto agree that
the maximum period, scope or geographical area reasonable under such
circumstances shall be substituted for the stated period, scope and area.
Because Executive's services are unique and because Executive has access to
Confidential Information and Work Product, the parties hereto agree that money
damages would be an inadequate remedy for any breach of this Agreement.
Therefore, in the event a breach or threatened breach of this Agreement, the
Company or its successors or assigns may, in addition to other rights and
remedies existing in their favor, apply to any court of competent jurisdiction
for specific performance and/or injunctive or other relief in order to enforce,
or prevent any violations of, the provision hereof (without posting a bond or
other security).
9. Executive Representations. Executive hereby represents and warrants
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to the Company that (i) the execution, delivery and performance of this
Agreement by Executive does not and will not conflict with, breach, violate or
cause a default under any contract, agreement, instrument, order, judgment or
decree to which Executive is a party or by which he is bound, (ii) Executive is
not a party to or bound by any employment agreement, non-compete agreement or
confidentiality agreement with any other person or entity, which would prohibit
his performance under this Agreement and (iii) upon the execution and delivery
of this Agreement by the Company, this Agreement shall be valid and binding
obligation of Executive, enforceable in accordance with its terms.
10. Survival. Paragraphs 5, 6, 7 8 and 9 shall survive and continue in
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full force in accordance with their terms notwithstanding any termination of the
Employment Period.
11. Notices. Any notice provided for in this Agreement shall be in
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writing and shall be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by telecopy or reputable
overnight courier service (charges prepaid) to the recipient at the address or
telecopy number below indicated:
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Notices to Executive:
▇▇▇▇▇ ▇▇▇▇▇
c/o ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: ▇▇▇-▇▇▇-▇▇▇▇
Notices to Company:
▇▇▇▇▇▇ ▇▇▇▇▇ & Partners
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Avy ▇. ▇▇▇▇▇
With a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇.
1600 Atlanta Financial Center
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention:▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy No.:(▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
or such other address or telecopy number or to the attention of such other
person as the recipient party shall have specified by prior written notice to
the sending party. Any notice under this Agreement will be deemed to have been
given when so delivered or sent or, if mailed, five days after deposit in the
U.S. mail.
12. Severability. Whenever possible, each provision of this agreement will
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be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
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13. Complete Agreement. This Agreement and those documents expressly
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referred to herein and other documents of even date herewith embody the complete
agreement and understanding among the parties and supersede and preempt any
prior understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any way.
14. Counterparts. This Agreement may be executed in separate
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counterparts, each of which to be an original and all of which taken together
constitute one and the same agreement.
15. Successors and Assigns. This Agreement is intended to bind and inure
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to the benefit of and be enforceable by all parties and their respective heirs,
successors and assigns, except that Executive may not assign his rights or
delegate his obligations hereunder without the prior written consent of the
Company.
16. Choice of Law. This Agreement will be governed by the internal law,
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and not the laws of conflicts, of the State of New York. The parties consent to
submit to the jurisdiction of the federal or state courts in New York, New York
in connection with any dispute arising hereunder.
17. Amendment and Waiver. The provisions of this Agreement may be amended
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or waived with the prior written consent of the Company and Executive, and no
course of conduct or failure or delay in enforcing the provisions of this
Agreement shall affect the validity binding effect or enforceability of this
Agreement.
18. Expenses. If the parties resort to litigation to resolve a dispute
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between the parties, the losing party shall pay the legal fees and court costs
of the prevailing party.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
UC TELEVISION NETWORK CORP.
By: /s/ ▇▇▇▇ ▇▇▇▇▇
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Its: Chief Financial Officer
/s/ ▇▇▇▇▇ ▇▇▇▇▇
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