EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of February 27, 1995, between TELEMUNDO
GROUP, INC., a Delaware corporation (the "Company"), and XXXXXX XXXXXXXXXX (the
"Executive").
Section 1. EMPLOYMENT AND TERM. The Company agrees to employ the
Executive and the Executive agrees to serve as an employee of the Company
with the duties set forth in Section 2 for a term (the "Term") beginning as
of February 27, 1995 (the "Commencement Date") and ending at the close of
business on February 27, 1996, or any earlier date of termination under
Section 6 or any later date of termination after extension under Section 7
(the "Termination Date").
Section 2. DUTIES. The Executive agrees during the Term to serve as
Senior Vice President-Administration of the Company. The Executive agrees to
use his best efforts to promote the interest of the Company, subject at all
times to the direction of the President and Chief Executive Officer of the
Company (the "President"), to whom the Executive shall report. The Executive
agrees to devote his entire business time and attention, with undivided
loyalty, to the performance of such duties.
Section 3. CONSIDERATION; SALARY AND BONUS DURING TERM.
(a) CONSIDERATION. The consideration for entering into this
Agreement shall be the performance of services by the Executive
pursuant to this Agreement and the employment of the Executive by the
Company as well as the payments and benefits provided under this
Agreement.
(b) SALARY. The Company shall pay salary to the Executive at the
annual rate of $225,000 during the Term, to be paid
(subject to required withholdings) in accordance with the Company's
regular payroll practices.
(c) BONUS. During the Term, the Executive will be eligible for
a bonus each year in an amount computed in accordance with Exhibit A
hereto. Bonuses hereunder shall be paid at the times bonuses are
customarily paid to the Company's executives. The Executive must be
employed by the Company on the last day of the calendar year to
receive a bonus for such year.
Section 4. VACATIONS. The Executive shall be entitled during the Term
to vacations in accordance with the policies of the Company, except that he
shall be entitled to three weeks of vacation per calendar year during the
first year of employment hereunder and four weeks of vacation per calendar
year during the second year of employment (pro rata for partial years). The
Company shall not pay the Executive any additional compensation for any
vacation time not used by the Executive. To the extent that the Executive
cannot take his vacation as a result of the request of the President of the
Company, he may carry such unused vacation over to the following calendar
year.
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Section 5. FRINGE BENEFITS. During the Term, the Executive shall enjoy
the benefits, including, without limitation, participation in medical
insurance, group term life insurance and retirement and savings plans, and
salary continuation benefits, customarily afforded to executives of the
Company in positions comparable to the Executive's. Nothing in this
Agreement shall restrict the right of the Company generally to amend, modify
or terminate any such benefits for executives in positions comparable to the
Executive's, but at no time shall they be less favorable to the Executive
than those generally afforded to executives with lower level positions than
the Executive.
Section 6. TERMINATION.
(a) The Company may terminate this Agreement for Cause as
determined by the President. "Cause" means the Executive's causing
material injury to the Company; the Executive's willful misconduct in
the performance of (or failure to perform) his duties hereunder; the
Executive's dishonest, fraudulent or unlawful behavior whether or not
in connection with his employment; or the Executive's unsatisfactory
performance of his duties hereunder after 60 days' prior written
notice, including reasons of such unsatisfactory performance and
failure to remedy such performance to the satisfaction of the
President within such 60 day period. Upon the effective date of
termination under this Section 6(a), the obligations of the parties
under this Agreement shall cease, except for the obligations of the
Executive contained in Sections 8 and 9.
(b) This Agreement shall terminate immediately upon the death or
other event rendering the Executive unable to perform his duties and
obligations under this agreement for a period in excess of 90 days,
whether or not consecutive, during the Term as determined by the
President. Upon the effective date of termination under this Section
6(b), the obligations of the parties under this Agreement shall cease,
except for the obligations of the Executive contained in Sections 8
and 9.
(c) If the Company terminates this Agreement other than pursuant
to Section 6(a) or 6(b) or if the Executive terminates this Agreement
pursuant to Section 6(d), then, except as provided in Section 7, the
Company's sole obligation to the Executive shall be to continue to pay
salary in accordance with Section 3(b) and maintain benefits in
accordance with Section 5 until the Termination Date. Upon the
effective date of termination under this Section 6(c), the obligations
of the parties under this Agreement shall cease, except for the
obligations of the Company under the preceding sentence and under
Section 7 and the obligations of the Executive contained in Sections 8
and 9.
(d) The Executive shall have the right to terminate his
employment under this Agreement in the event that he suffers a
Diminution of Duty (as defined below) within sixty days' of a Change
of Control (as such term is defined in the Company's 1994 Stock Plan).
A "Diminution in Duty" means a change in the
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Executive's responsibilities which represents a material
demotion or material diminution from his responsibilities as in effect
on the date hereof. A Diminution in Duty shall not be deemed to have
occurred prior to the giving of written notice by the Executive to the
Company specifically describing the alleged diminution or demotion,
and the actions the Executive believes are necessary to cure such
alleged Diminution in Duty, and the Company's failure to so cure
within 15 days of receipt of such notice. The giving of such notice
and the action or failure to take action by the Company shall be
irrelevant in determining whether a material demotion or material
diminution constituting a Diminution in Duty has in fact occurred.
Section 7. EXTENSION OF THE TERM.
(a) The Company shall have an option, exercisable in its sole
discretion by written notice to the Executive on or before January 13,
1996, to extend the Term for an additional one year period. The terms
of such additional one year period shall be the same as those for the
first year, except that the bonus schedule shall be as set forth on
Exhibit A hereto. The Executive shall have the right to reject such
proposed extension by written notice to the Company on or before
January 18, 1996.
(b) If the first year budget is achieved, as set forth on
Exhibit A, and the Company does not exercise its option to extend the
Term pursuant to Section 7(a) above, the Employee shall be entitled to
severance pay for a one year period following the Termination Date at
the rate of $90,000 per annum, to be paid (subject to required
withholding) in bi-weekly installments.
Section 8. CONFIDENTIALITY. Except as required in his duties
hereunder, the Executive will not, directly or indirectly, use, disseminate
or disclose any Confidential Information. Upon expiration or termination of
the Term, all documents, records and similar repositories of or containing
Confidential Information, including copies thereof, then in the Executive's
possession, whether prepared by the Executive or others, will be left with
the Company. "Confidential Information" means nonpublic information relating
to the Company or any affiliate of the Company. Following the expiration or
termination of the Term, the Executive agrees to reasonably cooperate with
the Company and its affiliates with respect to matters with which the
Executive was involved during the Term. This Section 8 shall survive the
expiration or termination of the Term. If in connection with Executive's
cooperation with respect to legal matters, it is necessary for Executive to
be represented by separate counsel, the Company will pay the reasonable fees
of such counsel, provided that if Executive is named as a defendant in an
action or proceeding by reason of fact that he was an officer of the Company,
any fees or expenses paid by the Company will be subject to procedures and
rights of indemnification of officers and directors of the Company under the
Company's By-Laws and the laws of the State of Delaware.
Section 9. COVENANT NOT TO INTERFERE. The Executive agrees and
covenants that, for a period of one year following the expiration or
termination of the Term, he will not interfere directly or
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indirectly in any way with the Company. "Interfere" means to influence or
attempt to influence, directly or indirectly, customers, program suppliers,
employees, performers or independent contractors of the Company, its
subsidiaries or any of its network affiliates to restrict, reduce, sever or
otherwise alter their relationship with the Company, its subsidiaries or any
of its network affiliates. In the event any court having jurisdiction shall
reduce the duration or scope of the covenant not to interfere set forth in
this Section 9, such covenant, in its reduced form, shall be enforceable.
This Section 9 shall survive the expiration or termination of the Term.
Section 10. ASSIGNABILITY, ETC. The rights and obligations of the
Company under this Agreement shall inure to the benefit of and shall be
binding upon the successors and assigns of the Company. The Executive
acknowledges that the services to be rendered by him are unique and personal
and accordingly that he may not assign any of his rights or delegate any of
his duties or obligations under this Agreement.
Section 11. NOTICES. All notices given hereunder shall be in writing
and shall be sent by registered or certified mail or delivered by hand and
shall be deemed to be given on the date received. Any notice by the Company
to the Executive shall be mailed or delivered to:
Xxxxxx Xxxxxxxxxx
00 Xxxxx Xxxxxxxx Xxxxx
Xxxxx Xxxxxx, XX 00000
or such other address as may from time to time be provided by the Executive
to the Company for such purposes.
Any notice by the Executive to the Company shall be mailed or delivered to:
Telemundo Group, Inc.
0000 Xxxx 0xx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn.: President and Chief Executive Officer
and
Telemundo Group, Inc.
0000 Xxxx 0xx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn.: Assistant General Counsel
or such address or addresses as may from time to time be provided by the
Company to the Executive for such purpose.
Section 12. CAPTIONS. The captions in this Agreement are inserted for
convenience only and do not constitute a part of this Agreement.
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Section 13. AMENDMENTS. ETC. This Agreement may be amended, modified
or terminated only by an instrument in writing signed by the parties hereto.
Section 14. GOVERNING LAW. This Agreement is made in an shall be
governed by and construed in accordance with the laws of the State of New
York, without giving effect to conflict of law principles. The Executive
hereby consents to the jurisdiction of the courts of the State of New York.
Section 15. REMEDIES. Each of the parties to this Agreement will be
entitled to enforce its rights under this Agreement specifically, to recover
damages by reason of any breach of any provision of this Agreement and to
exercise all other rights existing in its favor. The parties hereto agree
and acknowledge that money damages may not be an adequate remedy for any
breach of the provisions of this Agreement and that any party may in its sole
discretion apply to any court of law or equity of competent jurisdiction for
specific performance and/or injunctive relief in order to enforce or prevent
any violations of the provisions of this Agreement. Such specific
performance and/or injunctive relief shall be available without the posting
of any bond or other security.
Section 16. ENTIRE AGREEMENT: SEVERABILITY. This Agreement constitutes
the entire agreement between the parties with respect to the subject matter
hereof. Wherever possible, each provision of this Agreement will 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.
Section 17. NO CONFLICTS. The Executive represents and warrants to the
Company that the execution and performance of this Agreement by the Executive
does not violate or conflict with any agreement, arrangement, understanding
or restriction, written or oral, between the Executive and any other firm or
person. The Executive shall indemnify and hold harmless the Company and its
subsidiaries, shareholders, directors and officers from any all loss, damage
or expense, including attorneys' fees, arising out of any breach of the
foregoing representation and warranty by the Executive.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first above written.
TELEMUNDO GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
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President and Chief Executive Officer
/s/ X. X. Xxxxxxxxxx
---------------------------------------------
Xxxxxx Xxxxxxxxxx
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EXHIBIT A
TO AGREEMENT DATED AS OF FEBRUARY 27, 1995
BETWEEN TELEMUNDO GROUP, INC. AND
XXXXXX XXXXXXXXXX
(dollars in thousands)
ADJUSTED NET CONTRIBUTION(1)
Bonus Payment if
Target Achieved(2) 1995 Targets 1996 Target(3)
-------------------- ----------------- ---------------
$100 $33,187 (Goal) $39,824
$50 $28,858 (Budget) $34,630
(1) "Adjusted Net Contribution" means operating income plus depreciation and
amortization determined in accordance with generally accepted accounting
principles, without giving effect to any income, gain or loss associated with
TeleNoticias del Mundo, L.P., but determined consistent with the accounting
method for determining "Net Contribution before TeleNoticias" on the
Company's internal financial statements in prior periods and adjusted to
eliminate the impact of changes in accounting principles after the date of
this Agreement and of acquisitions or divestitures of operating units after
the date of this Agreement if taking such operating units into account would
either increase or decrease the actual Net Contribution by at least 5% of the
Adjusted Net Contribution target in the year of acquisition or divestiture on
an annualized basis and also adjusted to eliminate: (i) all monetary
compensation paid to executive officers who are terminated during calendar
year 1995 (but only such compensation paid after such termination); (ii) any
legal fees and costs paid by the Company with respect to item (i); (iii)
$95,000 of expenses in 1995; (iv) the expense associated with the exercise of
options to acquire common stock held on March 7, 1995 by the executive
officers of the Company, to the extent not in the Company's budget; (v) the
expense associated with the exercise of options issued to those persons who
are executive officers of the Company on March 7, 1995 in connection with
their termination prior to July 1995, to the extent not in the Company's
budget; (vi) direct costs incurred in the Company's bankruptcy
reorganization, to the extent not included in the Company's budget; (vii)
direct costs incurred in settling the Xxxxx litigation, to the extent not
include in the Company's budget; and (viii) certain contingent expenses
relating to Puerto Rico as discussed between the parties, to the extent not
included in the Company's budget. The adjustments set forth in clauses (i) -
(viii) (other than clause (iii)) shall occur only when and to the extent
actually expensed by the Company and to the extent considered in the
calculation of Adjusted Net Contribution.
(2) Each bonus payment shall be subject to required withholdings. Bonuses
shall not be prorated for partial years. However, the Executive must be
employed on the last day of a calendar year to earn a bonus for such year.
Calculations hereunder shall be made by the Company's Chief Financial
Officer, whose decision shall be final.
(3) 1996 Targets apply only if the Term of the Agreement is extended pursuant
to Section 7(a).
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