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EXHIBIT 10.57
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into by and between
Xxxx Xxxxxxxxxxxx ("Executive") and USA Networks, Inc., a Delaware corporation
(the "Company"), and is effective March 2, 1998 (the "Effective Date").
WHEREAS, the Company desires to establish its right to the services of
Executive, in the capacity described below, on the terms and conditions
hereinafter set forth, and Executive is willing to accept such employment on
such terms and conditions.
NOW, THEREFORE, in consideration of the mutual agreements hereinafter
set forth, Executive and the Company have agreed and do hereby agree as follows:
1. EMPLOYMENT. The Company agrees to employ Executive as Vice President -
Strategic Planning of the Company, and Executive accepts and agrees to such
employment. During Executive's employment with the Company, Executive shall do
and perform all services and acts necessary or advisable to fulfill the duties
and responsibilities as are commensurate and consistent with his position and
shall render such services on the terms set forth herein. During Executive's
employment with the Company, Executive shall report directly to the Chief
Financial Officer and/or the senior executive officer who has responsibility for
corporate staff functions (such person(s) as from time to time may be designated
by the Company, hereinafter referred to as the "Reporting Officer"). Executive
shall have such powers and duties with respect to the Company as may reasonably
be assigned to him by the Board or the Reporting Officer, to the extent
consistent with his position and status as set forth above. Executive agrees to
devote all of his working time, attention and efforts to the Company and to
perform the duties of his position in accordance with the Company's policies as
in effect from time to time. Executive's principal place of employment shall be
the Company's offices in New York City; however, Executive's position shall
require frequent long-distance travel on Company business.
2. TERM OF AGREEMENT. The term ("Term") of this Agreement shall commence
on the Effective Date and shall continue for a period of three years, unless
sooner terminated in accordance a ace with the provisions of Section 4 hereof.
3. COMPENSATION.
(a) BASE SALARY. The Company shall pay Executive an annual base salary
at the rate of $300,000 per year (the "Base Salary"), payable in equal biweekly
installments or in accordance with the Company's payroll practice as in effect
from time to time. The Base Salary shall be subject to a discretionary increase,
as determined by a review by the Company 18 months after the Effective Date, but
shall not be decreased from the rate in effect at any time and from time to time
during the Term. For all purposes under this Agreement, the term "Base Salary"
shall refer to Base Salary, including increases, if any, made from time to time.
(b) DISCRETIONARY BONUS. During the Term, Executive shall be eligible
to participate in the Company's annual incentive bonus plan or program
applicable to peer corporate executives of the Company, on a basis no less
favorable than that provided to peer corporate executives of the Company.
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(c) STOCK OPTION. In consideration of Executive's entering into this
Agreement and as an inducement to join the Company, Executive shall be granted
under the Company's 1997 Stock and Annual Incentive Plan (the "Plan") a
non-qualified stock option (the "Option") to purchase 60,000 shares of the
common stock, par value $.01 per share, of the Company (the "Common Stock"). The
date of grant of the Option shall be the Effective Date. The exercise price of
the Option shall equal the last reported sales price of the Common Stock on the
date preceding the Effective Date. Such Option shall vest and become exercisable
in four equal installments on the anniversary of the Effective Date in each of
1999, 2000, 2001 and 2002, provided that the Option shall become 100% vested and
exercisable upon a Change in Control (as such term is defined in the Plan). The
Option shall expire upon the earlier to occur of (i) ten years from the
Effective Date (the "Option Term") or (ii) except as otherwise provided in
Section 4 below, 90 days following the termination of Executive's employment
with the Company.
(d) BENEFITS. During the Term, Executive shall be entitled to
participate in any fringe, welfare, health and life insurance and pension
benefit and incentive programs as may be adopted from time to time by the
Company on the same basis as that provided to peer corporate executives of the
Company. Without limiting the generality of the foregoing, Executive shall be
entitled to the following benefits:
(i) Reimbursement for Business Expenses. During the Term, the
Company shall reimburse Executive for all reasonable and necessary
expenses incurred by Executive in performing his duties for the
Company, including, without limitation, expenses for travel related to
the business of the Company and entertainment expenses on the same
basis as peer executives in accordance with the Company's policies.
(ii) Vacation. During the Term, Executive shall be entitled to
four weeks of paid vacation per year, or such longer period as may be
provided by the Company, in accordance with the plans, policies,
programs and practices of the Company applicable to peer corporate
executives of the Company generally.
4. TERMINATION OF EXECUTIVE'S EMPLOYMENT.
(a) DEATH. In the event Executive's employment hereunder is terminated
by reason of Executive's death, (i) the Company shall pay Executive's designated
beneficiary or beneficiaries within 30 days of his death his Base Salary through
the end of the month in which death occurs in a lump sum in cash; (ii) all
outstanding equity incentive awards (including, without limitation, the Option)
which are vested and which have not been exercised by Executive shall remain
exercisable for a period of one year following the date of Executive's death or,
if earlier, until the end of the applicable option term; and (iii) the Company
shall pay Executive's designated beneficiary or beneficiaries within 30 days of
his death in a lump sum in cash any Accrued Obligations (as defined in
subparagraph 4(f) below).
(b) DISABILITY. If, as a result of Executive's incapacity due to
physical or mental illness ("Disability"), Executive shall have been absent from
the full-time performance of his duties with the Company for a period of four
consecutive months and, within 30 days after written notice is provided to him
by the Company, he shall not have retuned to the full-time performance of his
duties, Executive's employment under this Agreement may be terminated by the
Company or Executive for Disability. During any period prior to such termination
during which
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Executive is absent from the full-time performance of his duties with the
Company due to Disability, the Company shall continue to pay Executive his Base
Salary at the rate in effect at the commencement of such period of Disability,
offset by any amounts payable to Executive under any disability insurance plan
or policy provided by the Company. Upon termination of Executive's employment
for Disability, (i) the Company shall pay Executive within 30 days of his
Disability his Base Salary through the end of the month in which termination
occurs in a lump sum is cash, offset by any amounts payable to Executive under
any disability insurance plan or policy provided by the Company; (ii) all
outstanding equity incentive awards (including, without limitation, the Option)
which are vested and which have not been exercised by Executive shall remain
exercisable for a period of one year following the date of Executive's
Disability or, if earlier, until the end of the applicable option term; and
(iii) the Company shall pay Executive within 30 days of this Disability in a
lump sum in cash any Accrued Obligations (as defined in subparagraph 4(f)
below).
(c) TERMINATION FOR CAUSE. The Company may terminate Executive's
employment under this Agreement for Cause at any time prior to the expiration of
the Term. As used herein, "Cause" shall mean: (i) the plea of guilty to, or
conviction for, the commission of a felony offense by Executive; provided,
however, that after indictment, the Company may suspend Executive from the
rendition of services, but without limiting or modifying in any other way the
Company's obligations under this Agreement; (ii) a material breach by Executive
of a fiduciary duty owed to the Company; (iii) a material breach by Executive of
any of the covenants made by him in Section 5 hereof; or (iv) the willfull and
gross neglect by Executive of the material duties required by the Agreement. In
the event of termination for Cause, this Agreement shall terminate without
further obligation by the Company, except for the payment of any Accrued
Obligations (as defined in subparagraph 4(f) below).
(d) TERMINATION BY THE COMPANY OTHER THAN FOR DEATH, DISABILITY OR
CAUSE OR BY EXECUTIVE FOR GOOD REASON. If Executive's employment is terminated
by the Company for any reason other than Executive's death or Disability or for
Cause, or Executive terminates his employment for Good Reason (as defined
below), then (i) the Company shall pay Executive within 30 days of the date of
such termination the then present value of his Base Salary through the end of
the Term in a lump sum in cash; (ii) the Option shall immediately vest and any
then outstanding portion of the Option held by Executive shall remain
exercisable for a period of one year from the date of such termination or, if
earlier, until the end of the Option Term; and (iii) the Company shall pay
Executive within 30 days of the date of such termination in a lump sum cash any
Accrued Obligations (as defined in subparagraph 4(f) below). As used herein,
"Good Reason" shall mean the occurrence of any of the following: (i) the
Company's material breach of any of the provisions of this Agreement; (ii) any
material adverse alteration in Executive's title, position, status, duties,
level of reporting or responsibilities with the Company and (iii) any relocation
of Executive's office outside of the New York metropolitan area.
(e) MITIGATION; OFFSET. In no event shall Executive be required to seek
other employment or take any other action by way of mitigation of the amounts
payable under Section 4 hereof, provided that if Executive obtains other
employment during the Term, the amount of any payment or benefit provided for
under Section 4 hereof which has been paid to Executive shall be refunded to the
Company by Executive in an amount equal to any compensation earned
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by Executive as a result of employment with or services provided to another
employer after the date of Executive's termination of employment and prior to
the otherwise applicable expiration of the Term.
(f) ACCRUED OBLIGATIONS. As used in this Agreement, "Accrued
Obligations" shall mean the sum of (i) any portion of Executive's Base Salary
through the date of death, Disability or termination, as the case may be, which
has not yet been paid; (ii) any compensation previously deferred by Executive
(together with any interest or earnings thereon) that has not yet been paid; and
(iii) any accrued but unpaid bonuses or other accrued incentive compensation as
of the date of death, Disability or termination, as the case may be.
5. CONFIDENTIAL INFORMATION/NON-SOLICITATION.
(a) CONFIDENTIALITY. Executive acknowledges that in his employment
hereunder he will occupy a position of trust and confidence. Executive shall
not, except as may be required to perform his duties hereunder or as required by
applicable law, without limitation in time or until such information shall have
become public other than by Executive's unauthorized disclosure, disclose to
others or use, whether directly or indirectly, any Confidential Information
regarding the Company or any of its respective subsidiaries. "Confidential
Information" shall mean information about the Company or any of its respective
subsidiaries, and their respective clients and customers that is not disclosed
by the Company or any of its respective subsidiaries for financial reporting
purposes and that was learned by Executive in the course of his employment by
the Company or any of its respective subsidiaries, including (without
limitation) any proprietary knowledge, trade secrets, data, formulae,
information and client and customer lists and all papers, resumes, and records
(including computer records) of the documents containing such Confidential
Information. Executive acknowledges that such Confidential Information is
specialized, unique in nature and of great value to the Company and its
respective subsidiaries, and that such information gives the Company and its
respective subsidiaries a competitive advantage. Executive agrees to deliver or
return to the Company, at the Company's request at any time or upon termination
or expiration of his employment or as soon thereafter as possible, all
documents, computer tapes and disks, records, lists, data, drawings, prints,
notes and written information (and all copies thereof) furnished by the Company
and its respective subsidiaries or prepared by Executive in the course of his
employment by the Company and its respective subsidiaries.
(b) NON-SOLICITATION OF EMPLOYEES. Executive recognizes that he will
possess confidential information about other employees of the Company and its
respective subsidiaries relating to their education, experience, skills,
abilities, compensation and benefits, and inter-personal relationships with
suppliers to and customers of the Company and its respective subsidiaries.
Executive recognizes that the information he will possess about these other
employees is not generally known, is of substantial value to the Company and its
respective subsidiaries in developing their respective businesses and in
securing and retaining customers, and will be acquired by him because of his
business position with the Company. Executive agrees that, during the Term (and
for a period of 12 months beyond the expiration of the Term), he will not,
directly or indirectly, solicit or recruit any employee of the Company or any of
its respective subsidiaries for the purpose of being employed by him or by any
business, individual, partnership, firm, corporation or other entity on whose
behalf he is acting as an agent, representative or em-
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ployee and that he will not convey any such confidential information or trade
secrets about other employees of the Company or any of its respective
subsidiaries to any other person except within the scope of Executive's duties
hereunder.
(c) SURVIVAL OF PROVISIONS. The obligations contained in this Section 5
shall, to the extent provided in this Section 5, survive the termination or
expiration of Executive's employment with the Company and, as applicable, shall
be fully enforceable thereafter in accordance with the terms of this Agreement.
If it is determined by a court of competent jurisdiction in any state that any
restriction in this Section 5 is excessive in duration or scope or is
unreasonable or unenforceable under the laws of that state, it is the intention
of the parties that such restriction may be modified or amended by the court to
render it enforceable to the maximum extent permitted by the law of that state.
6. NOTICES. All notices and other communications under this Agreement shall
be in writing and shall be given by first-class mail, certified or registered
with return receipt requested or hand delivery acknowledged in writing by the
recipient personally, and shall be deemed to have been duly given three days
after mailing or immediately upon duly acknowledged hand delivery to the
respective persons named below:
If to the Company: USA Networks, Inc.
Carnegie Hall Tower
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
If to Executive: Xxxx Xxxxxxxxxxxx
000 Xxxx 00xx Xxxxxx, Xxx. #0
Xxx Xxxx, Xxx Xxxx 00000
Either party may change such party's address for notices by notice duly given
pursuant hereto.
7. TERMINATION OF PRIOR AGREEMENTS. This Agreement constitutes the entire
agreement between the parties and terminates and supersedes any and all prior
agreements and understandings among the parties with respect to Executive's
employment and compensation by the Company. The Company acknowledges and agrees
that neither Executive nor anyone acting on his behalf has made, and is not
making, and in executing this Agreement, the Company has not relied upon, any
representations, promises or inducements except to the extent the same is
expressly set forth in this Agreement.
8. ASSIGNMENT; SUCCESSORS. This Agreement is personal in its nature and none
of the parties hereto shall, without the consent of the others, assign or
transfer this Agreement or any rights or obligations hereunder, provided that,
in the event of the merger, consolidation, transfer, or sale of all or
substantially all of the assets of the Company with or to any other individual
or entity, this Agreement shall, subject to the provisions hereof, be binding
upon and inure to the benefit of such successor and such successor shall
discharge and perform all the promises, covenants, duties, and obligations of
the Company hereunder, and all references herein to the "Company" shall refer
to such successor.
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9. GOVERNING LAW. This Agreement and the legal relations thus created between
the parties hereto shall be governed by and construed under and in accordance
with the internal laws of the State of New York.
10. WITHHOLDING. The Company shall make such deductions and withhold such
amounts from each payment made to Executive hereunder as may be required from
time to time by law, governmental regulation or order.
11. HEADINGS. Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.
12. WAIVER; MODIFICATION. Failure to insist upon strict compliance with any of
the terms, covenants, or conditions hereof shall not be deemed a waiver of such
term, covenant, or condition, nor shall any waiver or relinquishment of, or
failure to insist upon strict compliance with, any right or power hereunder at
any one or more times be deemed a waiver or relinquishment of such right or
power at any other time or times. This Agreement shall not be modified in any
respect except by a writing executed by each party hereto.
13. SEVERABILITY. In the event that a court of competent jurisdiction
determines that any portion of this Agreement is in violation of any law or
public policy, only the portions of this Agreement that violate such law or
public policy shall be stricken. All portions of this Agreement that do not
violate any statute or public policy shall continue in full force and effect.
Further, any court order striking any portion of this Agreement shall modify the
stricken terms as narrowly as possible to give as much effect as possible to the
intentions of the parties under this Agreement.
14. INDEMNIFICATION. The Company shall indemnify and hold Executive harmless
for acts and omissions in his capacity as an officer, director or employee of
the Company to the maximum extent permitted under applicable law; provided,
however, that neither the Company, nor any of its respective subsidiaries shall
indemnify Executive for any losses incurred by Executive as a result of acts
described in Section 4(c) of this Agreement.
15. COUNTERPARTS. This Agreement may be executed in several counterparts, each
of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
and delivered by its duly authorized officer and Executive has executed and
delivered this Agreement on March 16, 1998.
USA NETWORKS, INC.
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By: Xxxxxx X. Xxxx
Senior Vice President and
General Counsel
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