EXHIBIT 10.7
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into as of the 27th day of January,
2000, by and between ODYSSEY HOLDINGS, L.L.C., a Delaware limited liability
company with offices at 1325 Avenue of the Americas, Xxx Xxxx, Xxx Xxxx 00000 or
its permitted assigns ("Company" or "Employer"), and Xxxxxxx Xxxxxx
("Employee"). The parties hereto agree now as follows:
1. Engagement. Company hereby engages Employee, and Employee accepts
such engagement, to furnish exclusive, full-time services to Company during the
Term (as defined below) as an executive of Company with the title of Executive
Vice President, National Advertising Sales, reporting to the President and CEO
and/or the Chief Operating Officer of the Company; provided, however, that
Employee will report directly to the President and CEO during the first six (6)
months of the Term. Employee shall render services at Company's offices in New
York, New York, and at such other place or places as Company may reasonably
require from time to time; provided, that Employee's duties shall not require
Employee to move his residence from the New York metropolitan area. Employee
agrees to use reasonable efforts to promote and further the reputation and good
name of Company and Employee shall promptly and faithfully comply with all
reasonable instructions, directions, requests, rules and regulations made or
issued from time to time by Company, so long as such instructions, directions,
requests, rules and regulations do not conflict with the terms of this
Agreement. Employee shall have the authority, functions, duties, powers and
responsibilities normally associated with his position in the cable television
industry, and such others consistent therewith as the CEO and/or COO may from
time to time delegate to the Employee. Employee's services shall be rendered
solely and exclusively to Company during the term hereof. 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 interferes with any of his duties or
obligations hereunder or which is directly competitive with the business of the
Employer or its subsidiaries.
2. Term. The term of this Agreement and Employee's services hereunder
(the "Term") shall be a period of four (4) years, commencing no later than
February 7, 2000, or unless sooner terminated pursuant to the terms and
conditions of this Agreement.
3. Compensation. As full and complete consideration for all of the
undertakings and agreements of Employee hereunder, the services of Employee and
the results and proceeds thereof, and all rights herein granted to Company, and
upon the condition that Employee shall fully and faithfully perform all material
obligations and services in accordance with the terms of this Agreement, Company
shall pay Employee or cause Employee to be paid the following:
(a) Salary. A salary at the rate of Three Hundred Fifty
Thousand Dollars ($350,000) per annum, which shall increase each year at the
rate of 5% per year on Employee's anniversary date. Said salary shall be payable
in accordance with Company's regular payroll policies.
(b) Bonus. An annual bonus of at least Seventy-Five Thousand
Dollars ($75,000) and up to One Hundred Fifty Thousand Dollars ($150,000) for
achieving 100% of the annual target for sales achievement per contract year
during the Term in accordance with the Company's Sales Incentive Plan. Employee
may earn additional annual bonus amounts, as may be agreed to between the
parties hereto from time to time, if more than 100% of the annual target for
sales achievement is reached. Employee will develop the Company's Sales
Incentive Plan, subject to Company's approval.
(c) Other. Except as expressly provided in this Agreement, no
other compensation or other consideration shall become due or payable to
Employee on account of the services rendered hereunder or the rights granted to
Company hereunder.
Company shall have the right to deduct and withhold from the compensation
payable to Employee hereunder any amounts required to be deducted and withheld
under the provisions of any statute, regulation, ordinance, order or any other
amendment thereof, heretofore or hereafter enacted, requiring the withholding or
deduction of compensation.
4. Expenses and Other Benefits During Term.
(a) Employee shall participate in any and all employee benefit programs
maintained from time to time by Company, including any bonus pools, pensions
plans and deferred compensation plans, and any medical, dental and basic life
and disability insurance coverage so maintained, in each case subject to the
eligibility, benefits limits and other terms or requirements of such policies or
programs. Employee's level of participation in such programs shall be
commensurate with Employee's position, title, duties, compensation and length of
service, and shall be no less than enjoyed by other Executive Vice Presidents of
Company. Employee shall be entitled to all benefits available to other employees
of Company who are not providing services under a written agreement, both during
the term hereof and upon termination of this agreement. The Company will make a
6% contribution based upon Employee's total compensation (including salary and
bonus) in accordance with the terms of Company's 401k plan.
(b) Employee will be granted 50,000 phantom share appreciation
rights ("SAR's) in accordance with Employer's Share Appreciation Rights Plan
(the "Plan"). The SAR's will vest over five years at the rate of 10,000 SAR's
per year on the Employee's anniversary date, provided that Employee is employed
by Company at such time, and shall be subject to the
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restrictions set forth in the Plan related to their exercise and transferability
and will provide plan participants with the right to benefit from any increase
in the value of SAR's for a specified number of years. The SAR's will have none
of the rights associated with common shares such as voting or dividend rights
and will have no value outside the context of the Plan. The SAR's granted to
Employee shall have a floor value of Three Hundred Twenty-Two Million Dollars
($322,000,000).
(c) Employee shall be entitled to (but may at no time during
the Term accrue in excess of) four (4) weeks paid vacation for each year of the
Term.
(d) During the Term, Employer shall pay or reimburse Employee
on an accountable basis for all reasonable, ordinary and necessary out-of pocket
expenses for entertainment, travel, meals, hotel accommodations and other
expenditures incurred by Employee in connection with Employee's services to
Employer, upon presentation of appropriate documentation of such expenses, in
accordance with Employer's expense account policies for its executive personnel.
When Employee is required by the Company for business reasons to travel by air,
Company shall provide business class air accommodations, or if business class is
not available, then first class. Company will also reimburse Employee up to
Eight Thousand Dollars ($8,000) annually during the Term or any extension
thereof for Employee's golf club membership, upon reasonable substantiation of
such fees and/or dues actually paid by Employee.
5. Confidential Information.
(a) Employee recognizes and acknowledges that Employee shall
receive in the course of employment hereunder certain non-public confidential
information and trade secrets concerning Company's business and affairs which
may be of great value to Company. Employee therefore agrees that, except as may
be required by law and except as required to perform his job responsibilities to
Company, Employee shall not, at any time during or following the Term, disclose
any such information relating to Company or its business including, without
limitation, Company's personnel or operations, sales, sales projections,
strategies, plans or any idea, project or other property being considered for
use by Company or being used by Company and/or produced by Company, to any third
party or in any way use such information in any manner which could adversely
affect Company's business. Employee agrees that during and following the Term,
Employee will not develop, produce and/or otherwise exploit any idea,
presentation, material and/or other property which during the Term is submitted
to, acquired by, and/or considered for development and/or use by Company. For
purposes of this agreement, the terms "trade secrets" and "confidential
information" shall include any and all information concerning the business and
affairs of Company, or any other entity with whom Company may have a
production/overhead
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arrangement and any division, subsidiary or other affiliate of Company. This
provision does not apply to information which becomes available publicly without
the fault of Employee or information which Employee discloses in confidence to
his own privileged representatives or is required to disclose in legal
proceedings, provided Employee gives advance notice to the President of Employer
and an opportunity to Employer to resist such disclosure in legal proceedings.
(b) In addition to Company's confidential information and
trade secrets, Employee may be exposed to proprietary information and materials
provided to Company by third parties under license agreements, non-disclosure
agreements or other restrictive arrangements, including without limitation
computer software programs ("Third Party Information"). Upon the request of
Company, Employee will execute such forms as may be reasonably required
acknowledging receipt and possession of such Third Party Information, including
any manuals related thereto. Employee agrees, at all times both during and
following the Term, to use all such Third Party Information only in accordance
with Company's instructions and with the terms of any license or other
restrictions relating thereto provided by Company to Employee.
(c) Employee agrees during the term hereof not to engage or
invest in any other business (except for a publicly traded company where
Employee will own no more than 1% of the outstanding stock of such company), the
principal purpose of which is the development of theatrical and/or television
motion pictures or programming or any other related business, as owner,
shareholder, investor, operator, manager, officer, director, partner, joint
venturer, advisor, consultant, agent, employee, trustee, lender of money or in
any other capacity, or own any other interest, direct or indirect, in any
business in competition with Company.
(d) Employee acknowledges and agrees that any breach by
Employee of any of the provisions of this Section 5 would result in irreparable
harm to Company, for which monetary damages would be inadequate or difficult or
impossible to ascertain. Accordingly, and notwithstanding anything to the
contrary herein, Company shall be entitled, at any time and without resort to
arbitration, to seek injunctive relief in any court of competent jurisdiction to
prevent or stop any such breach or continued breach. In the event of any such
action, the prevailing party shall be entitled to recover all reasonable costs
and expenses incurred by such party in connection therewith, including
attorneys' fees.
6. Rights and Materials. Company shall own, in perpetuity, throughout
the universe, all right, title and interest in and to the results and proceeds
of Employee's services hereunder and all material produced and/or furnished by
Employee, of any kind and
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nature whatsoever (collectively, the "Work Product"); it being understood and
agreed that Employee for the purposes hereof is acting entirely as Company's
employee-for-hire, and that Company hereby acquires the maximum rights permitted
to be obtained by employers and purchasers of literary material, including
without limitation the right to exploit the Work Product in any and all media
now known or hereafter conceived or created, throughout the Universe and in
perpetuity. Any Work Product created and/or submitted to Company hereunder shall
automatically become the property of Company and Employee hereby transfers and
agrees to transfer and assign to Company all rights and materials related to or
comprising the Work Product (including but not limited to all copyrights and
similar protections and renewals and extensions of copyright and any and all
causes of action that may have heretofore accrued in Employee's favor for
infringement of copyright). All documents, correspondence, notes, memoranda and
other written, magnetic or other physical records of any kind, or any copies
thereof, received or made by Employee with respect to Employee's duties during
and in connection with employment hereunder shall be and remain the sole
property of Company and upon the expiration or termination of this Agreement,
Employee shall deliver all such material to Company. Employee shall, at
Company's request, execute and deliver to Company or procure the execution and
delivery to Company of such documents or other instruments which Company may
from time to time deem necessary or desirable to evidence, maintain and protect
its rights hereunder and to carry out the intents and purposes of this Agreement
and to convey to Company the necessary rights in and to the materials supplied
to Company by Employee hereunder. In the event that Employee fails promptly to
execute, acknowledge or deliver to Company any agreements, assignments,
quitclaims or other instruments required by Company hereunder, Company is hereby
irrevocably appointed Employee's attorney-in-fact (which agency shall be deemed
coupled with an interest) with full right, power and authority to execute,
acknowledge, verify and deliver the same in the name of and on behalf of
Employee.
7. Termination; Suspension.
(a) For Cause. If Employee shall, at any time during the Term
hereof, (i) be convicted of any act which constitutes a felony under federal,
state or local laws or the law of any foreign country; (ii) engage in the
illegal use of a controlled substance, or the immoderate use of alcohol which
adversely affects Employee's performance of Employee's services under this
Agreement; (iii) violate any law, regulation or government order that exposes
the Company to material liabilities (provided that such conduct was not based
upon direction from Company management or counsel); (iv) engage in gross
misfeasance, fraud or embezzlement in the course of performance hereunder; (v)
persistently fail, refuse or neglect, after reasonable written notice, to fully
render and perform Employee's material obligations hereunder; or (vi) in the
event of 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 his
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duties hereunder, (such events hereinafter sometimes collectively referred to as
a "default"), then in addition to any other rights Company may have, Company
shall have the right to terminate this Agreement and Employee's services for
cause without further liability to Employee whatsoever (other than with respect
to accrued, unpaid salary and expenses arising prior to termination). Company
shall terminate by written notice to Employee, setting forth in reasonable
detail the nature of the alleged default.
(b) Death or Disability. If Employee suffers an incapacity,
illness or mental or physical disability which incapacitates or prevents
Employee from rendering services to Company for a period of twelve (12) weeks in
the aggregate during any twelve (12) month period, or if Employee dies during
the Term hereof, Company may terminate this Agreement at any time thereafter and
all further obligations of Company hereunder (excluding only accrued, unpaid
compensation or benefits arising prior to termination) shall cease upon any such
termination. In the event of Employee's disability (excluding minor illness of
four (4) aggregate weeks or less) during each year of the Term hereof, Company
shall have the right to suspend this Agreement and Employee's services at
Company's election, effective immediately upon written notice to Employee.
(c) Without Cause. If Employee is terminated without cause,
Employee shall be entitled to receive the base salary, bonus and benefits
(including any accrued bonus pool participation) otherwise due hereunder when
the same would otherwise have been paid hereunder. Employee shall have a duty to
mitigate damages by pursuing reasonably comparable alternative employment. If
Employee is thereafter employed during the Term, any sums earned by Employee
pursuant to such subsequent employment shall be offset against any remaining
obligation Company may have to Employee hereunder. If Employee is terminated
without cause, in no event shall Company be liable to Employee for more than the
base salary, bonus and benefits specified above. Without limiting the foregoing,
Company shall not be liable for any consequential or punitive damages claimed as
a result of any such termination.
8. Force Majeure. If Company's operations or Employee's services
hereunder are interrupted or materially interfered with by reason of any
governmental law, ordinance, order or regulation, or by reason of fire, flood,
earthquake, labor dispute, lockout, strike, accident, act of God or public
enemy, or by reason of any other similar event giving rise to any suspension
and/or termination of Company's operations or by reason of any other similar
cause, thing or occurrence of the same or any other nature not within Company's
control, Company shall have the right at any time to suspend this Agreement and
Employee's services hereunder. If
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Company elects to suspend this Agreement, then such suspension shall be for a
period equal to the duration of any such occurrence (unless lifted by Company)
and no compensation shall be paid or become due to Employee hereunder during
such period; provided, however, that if Employee is suspended for more than
sixty (60) days, then Employee may elect to terminate this Agreement upon
written notice to Company. In such event, Company shall have the option, at its
election, to recall Employee upon reasonable notice within five (5) business
days' after Company's receipt of Employee's notice of termination. If Employee
is suspended hereunder for more than two weeks, then Employee may render
services for Employee's own account subject to recall on reasonable notice.
Unless this Agreement shall have been previously terminated as provided herein,
any such suspension shall end as soon as the cause of such suspension ceases,
and all time periods and dates hereunder shall be extended by a period equal to
the period of such suspension, at Company's election. If a suspension by reason
of any event of force majeure hereunder shall continue for more than eight (8)
consecutive weeks, Company shall have the right to terminate this Agreement by
written notice to Employee given prior to the cessation of such event of force
majeure (subject to Company's obligation to pay all accrued, unpaid compensation
and benefits otherwise due up to the date of termination).
9. No Obligation. Notwithstanding anything to the contrary herein,
Company shall have no obligation to use the services of Employee hereunder;
provided, that so long as this Agreement and Employee's services have not been
terminated or suspended hereunder, Company shall continue to pay to Employee all
compensation and benefits due hereunder in accordance with the terms of this
Agreement.
10. No Raid. Employee 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 working as an officer,
policymaker or in high-level creative development, sales or distribution
(including without limitation executive employees) for or rendering
substantially full-time services as such to Employer.
11. Eligibility. All of Company's obligations in this Agreement are
expressly conditioned upon Employee's completion of Employee Eligibility
Verification Form (Form I-9) and upon Employee's submission to Company of
original documents satisfactory to Company to demonstrate Employee's employment
eligibility in accordance with the Immigration Reform and Control Act of 1986.
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12. Enforceability; Arbitration. Employee acknowledges and agrees that
the rights granted and the services to be performed hereunder are of a special
and unique kind and character and that, if there is any breach by Employee of
any material provision of this agreement, Company would not have an adequate
remedy at law. It is therefore expressly agreed that the rights of Company
hereunder may be enforced by an action for specific performance and such other
equitable relief as is provided under the laws of the State of New York. Subject
to the foregoing, any dispute between the parties shall, upon written notice by
either to the other, be submitted to arbitration in accordance with the American
Arbitration Association (AAA) Commercial Arbitration Rules with Expedited
Procedures in effect on the date hereof, as modified by this Paragraph 11. There
shall be one arbitrator selected mutually by the parties within ten (10)
business days of the arbitration notice or if not, then pursuant to the AAA
Rules. The arbitrator so selected shall be an attorney with at least 15 years of
entertainment law experience. Any issue about whether a claim is covered by this
Agreement shall be determined by the arbitrator. The arbitrator's decision shall
be binding, final and non-appealable. The arbitration shall be conducted in New
York, New York. At the request of either party made not later than 15 days after
the arbitration notice, the parties agree to submit the dispute to non-binding
mediation which shall not delay the arbitration hearing date. The arbitrator
shall authorize such discovery as may be necessary to ensure a fair private
hearing, which shall be held within 60 days of the notice, and shall conclude if
feasible within 3 days. These time limits are not jurisdictional. The arbitrator
shall apply substantive law and may award injunctive relief or any other remedy
available from or to a judge, including attorney fees and costs to the
prevailing party.
13. Assignment. Employee may not assign this Agreement or any part
hereof. Company shall have the right to loan or make available, without
additional compensation to Employee, Employee's services to any subsidiary or
other related entity, provided, that his duties to any such related entity shall
be consistent with his duties under this Agreement. Employee further agrees that
all the terms of this Agreement shall be applicable to Employee's services for
each such related entity. Company may assign this Agreement in its entirety in
connection with any sale or reorganization of the Company or any sale of
substantially all of Company's operating assets or of the operating assets of
any division of Company. Upon such assignment, Company shall be released
thereupon from any further obligation to Employee hereunder if (1) such assignee
is an affiliate of Company, a major motion picture production or distribution
company or a television network, or a similarly financially responsible party,
(2) such assignee assumes in writing the obligations to Employee hereunder, and
(3) Employee is engaged in a comparable position with comparable duties by
assignee. All of the terms and provisions contained herein shall inure to the
benefit of and shall be binding upon the parties hereto and their respective
heirs, personal representatives, administrators, executors, successors and
permitted assigns. For purposes hereof, an "affiliate" of Company shall mean any
person, firm or entity controlling, controlled by, or under common control with
Company.
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14. Notices. Any and all notices, demands and other communications
required or desired to be given hereunder by any party shall be in writing and
shall be validly given or made to another party if served either personally or
deposited in the United States mail, certified, or registered, postage prepaid,
return receipt requested. If such notice, demand or other communication is
served personally, service shall be conclusively deemed made at the time of such
personal service. If such notice, demand or communication is given by mail, such
shall be conclusively deemed given seven (7) days following its deposit thereon
in the United States mail addressed to the party to whom such notice, demand or
other communication is to be given as hereinafter set forth:
To Employee:
Xxxxxxx Xxxxxx
00 Xxxxxxxx Xxxxx
Xxxx Xxxxxx Xxxxxx, Xxx Xxxx 00000
With a courtesy copy to:
Xxxxxx X. Xxxxxx, Esq.
Xxxxx Xxxxx & Xxxxxxx P.C.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
To Company:
Odyssey Holdings, L.L.C.
00000 Xxxxxxx Xxxxxxxxx
Xxxxxx Xxxx, Xxxxxxxxxx 00000
Attn.: Office of the President
With a courtesy copy to:
Xxxxxxx X. Xxxx, Esq.
00000 Xxxxxxxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxxxx 00000
Any party hereto may change its address for the purpose of receiving notices,
demands or other communications as herein provided by a written notice given in
the manner aforesaid to the other party or parties hereto.
15. Applicable Law and Severability. This Agreement shall, in all
respects, be governed by the laws of the State of New York applicable to
agreements executed and to be wholly performed within the State of New York.
Nothing contained herein shall be construed so as to require the commission of
any act contrary to law, and wherever there is any conflict between any
provision contained herein and any present or future statute, law, ordinance or
regulation contrary to which the parties have no legal right to
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contract, the latter shall prevail but the provision of this document which is
affected shall be curtailed, modified and limited only to the extent necessary
to bring it within the requirements of the law.
16. Waiver. No waiver by either party hereto of any failure by the
other party to keep or perform any covenant or condition of this agreement shall
be deemed to be a waiver of any preceding or succeeding breach of the same, or
any other covenant or condition. The remedies herein provided shall be deemed
cumulative and the exercise of any one shall not preclude the exercise of or be
deemed a waiver of any other remedy, nor shall the specification of any remedy
hereunder exclude or be deemed a waiver of any rights or remedies at law, or in
equity, which may be available, including any rights to damages or injunctive
relief.
17. 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 satisfactorily perform Employee's services hereunder.
18. Entire Agreement; Amendments. This document, which may be executed
in counterparts, constitutes the entire understanding and agreement of the
parties and any and all prior and contemporaneous agreements, understandings or
representations are hereby terminated and canceled in their entirety and are of
no further force of effect. This Agreement may be amended only in a writing
signed by the party to be charged with such amendment.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
COMPANY: ODYSSEY HOLDINGS, L.L.C.
By: PRESIDENT AND CHIEF EXECUTIVE OFFICER
Its: /s/ XXXXXXXX XXXXXX
Date: MARCH 3, 2000
EMPLOYEE:
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------
Xxxxxxx Xxxxxx
Date: JANUARY 27, 2000
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