Exhibit 10.37
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THIS MANAGEMENT AGREEMENT (this "Agreement") is made as of November 1,
1995, between METROMEDIA COMPANY, a Delaware general partnership ("Metromedia"),
and METROMEDIA INTERNATIONAL GROUP, INC., a Delaware corporation ("MIG") and an
affiliate of Metromedia.
WHEREAS, Metromedia and MIG have agreed that Metromedia will provide
to MIG and MIG will procure from Metromedia the services described herein on the
terms and conditions set forth herein.
NOW THEREFORE, in consideration of the Premises, terms and conditions
set forth herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE 1
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MANAGEMENT
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1.1 Appointment of Metromedia; Acceptance of Appointment.
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1.1.1 MIG hereby appoints Metromedia to provide to MIG such
services of Metromedia's officers and other persons employed or retained by
Metromedia as are more particularly provided for below in this Section 1.1 and
Metromedia hereby accepts such appointment and agrees to provide services to MIG
in accordance with the terms of this Section 1.. Metromedia and MIG anticipate
that the specific needs of MIG may change in accordance with, among other
things, changes in the business of MIG. MIG hereby grants to Metromedia
complete access to its operating assets, wherever located, and, to the extent
necessary or desirable, to its employees, books and records in order to permit
Metromedia to perform its duties hereunder.
1.1.2 Metromedia will, to the extent requested by MIG or its
subsidiaries, or to the extent MIG or it deems necessary or appropriate:
(a) consult with and/or advise MIG concerning legal matters in
general and provide, or arrange (at the expense of MIG) for the provision of,
legal advice and services concerning the business and operations of MIG and all
requirements of law, including without limitation
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and if appropriate, the rules and regulations of all applicable federal, state
and local regulatory authorities;
(b) at the request and expense of MIG, arrange for, procure and
cause to be maintained such insurance as may be obtained on reasonable terms and
as appropriate to insure against risks and liabilities relating to the
operations and assets of MIG and all aspects of the performance by Metromedia of
its duties hereunder, which insurance will (i) name MIG or Metromedia or both of
them as the insured party or parties, (ii) provide coverage to MIG as is
customary and commercially reasonable, and {(iii) to the extent practicable,
obtain a waiver of subrogation by the insurer in favor of any of such parties as
may be appropriate.} If Metromedia receives any proceeds from anyinsurance
claims based upon damage or injury to any assets or loss of business of MIG,
then Metromedia will credit such proceeds to MIG;
(c) consult with MIG regarding the establishment of personnel
and other corporate policies;
(d) subject to the provisions of Section 3.2 hereof, if and when
Metromedia deems it appropriate, on behalf of and in the name of Metromedia
and/or MIG, prosecute or defend, as the case may be, all suits, actions,
arbitrations or other proceedings brought by or through MIG, and otherwise deal
with and, if appropriate, settle any claims against or disputes involving MIG;
(e) consult with MIG regarding payroll and financial accounting
systems and cash management functions and provide to MIG the services of
Metromedia's internal audit and finance department;
(f) prepare or coordinate the preparation of federal, state and
any local tax returns, handle or supervise any audits of such returns of MIG and
its subsidiaries by tax authorities, and provide to MIG any tax information and
any other tax services as may be requested by MIG, including tax planning or tax
advisory services;
(g) in consultation with the officers of MIG, establish and
maintain at MIG's expense such benefit plans for the employees of MIG as are
deemed appropriate, and provide such services as are necessary in order to
ensure that such benefit plans are in compliance with the applicable provisions
of ERISA; and
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(h) at the request and expense of MIG, provide any other
services as may reasonably be requested by MIG.
1.1.3 Notwithstanding any other provision of this Agreement,
in the performance of its duties hereunder, Metromedia will not have any
obligation to incur any cost or expense or to advance any funds which constitute
a Reimbursable Expense (as hereinafter defined) unless, in the reasonable
opinion of Metromedia, sufficient funds of MIG will be available, from operating
revenues or otherwise, to pay for or reimburse Metromedia promptly for such
cost, expense or advance as incurred.
1.1.4 The Management Fee referred to in Section 1.4 hereof
and the other transactions provided for in this Agreement, and all other
transactions negotiated, arranged, undertaken or entered into between MIG and
Metromedia or any affiliate of Metromedia or any partner, officer, or employee
of Metromedia or any of its affiliates will be negotiated on an arms-length
basis.
1.2 Limited Duties and Responsibilities. Metromedia will not have
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any duty or responsibility to provide any services or to take or refrain from
taking any actions except as provided in this Agreement. Nothing in this
Agreement will be construed to provide for any compensation for services
rendered or acts performed by Metromedia or its partners, officers or employees
as a shareholder or director of MIG.
1.3 Reimbursable Expenses.
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1.3.1 Except as provided in Section 1.3.2 hereof, MIG will be
responsible for, and Metromedia will be entitled to apply any revenues or other
available funds of MIG in its possession to, out-of-pocket costs and expenses
incurred by Metromedia and advances paid by Metromedia in connection with the
performance by Metromedia of its obligations hereunder with respect to MIG (such
costs, expenses and advances being herein collectively referred to as
"Reimbursable Expenses") including but not limited to (i) such costs, expenses
and advances that have been incurred by Metromedia on behalf of MIG and charged
to MIG including, without limitation, the costs of insurance, employment agency
fees, postage, telephone usage and internal and outside counsel and auditors and
tax advisors, and (ii) such other costs, expenses and advances as are properly
allocable
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to MIG; provided, however, that nothing in this Agreement will be construed to
authorize or permit Metromedia to charge to MIG any expense incurred by
Metromedia if and to the extent that such expense is, in light of all relevant
facts and circumstances, properly viewed as arising from or properly allocable
to the activities, actions, or functions undertaken by Metromedia solely for its
own benefit and unrelated to the performance by Metromedia of its obligations
hereunder. All Reimbursable Expenses will be paid to Metromedia, in cash,
quarterly.
1.3.2 There will be excluded from Reimbursable Expenses the
following costs, expenses and advances of Metromedia that are attributable to
the management of its day-to-day business and operations and those of its
affiliates, including:
(a) salaries and operating expenses of Metromedia personnel that
provide services to MIG, and
(b) costs, depreciation and/or rent of headquarters facilities
owned or leased by Metromedia and not directly allocable to the business of MIG.
1.4 Management Fee.
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1.4.1 In order to compensate Metromedia for its services
hereunder and for certain overhead and other costs incurred by it for which MIG
is not directly responsible pursuant to Section 1.3 hereof, MIG will pay to
Metromedia a management fee (the "Management Fee") at the annual rate of
$1,500,000.00. MIG will pay the Management Fee to Metromedia in twelve equal
monthly installments of $125,000.00 each no later than 15 days after the end of
each of its twelve monthly accounting periods. The Management Fee may be
adjusted to the extent necessary to compensate Metromedia for services rendered
or costs incurred not originally contemplated hereunder.
ARTICLE 2
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TERM AND TERMINATION
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2.1 Term. This Agreement will become effective as of November 1,
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1995 and will terminate on October 31, 1996 and will be automatically renewed
unless either party provides to the other 60 days' notice. In the event of
termination of this Agreement, MIG will remain liable to Metromedia, and
Metromedia will remain
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liable to MIG, for any amounts and obligations owing to or accrued in favor of
Metromedia or MIG, as the case may be, prior to the effective date of such
termination.
ARTICLE 3
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LIABILITY AND INDEMNIFICATION
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3.1 Limitations on Liability. Notwithstanding anything to the
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contrary in this Agreement, Metromedia will not be liable to MIG for any loss or
damage of any nature incurred or suffered by MIG in any way relating to or
arising out of the act or default of Metromedia or any of its employees or
agents in the performance or the non-performance of this Agreement or any part
hereof, except loss or damage to MIG caused by Metromedia's gross negligence or
willful misconduct, to the extent to which the same is not covered by insurance.
In no event will Metromedia be liable for MIG's loss of profits and/or other
consequential loss or damage nor will Metromedia be in any way liable for any
act, default or negligence, willful or otherwise, of any independent contractor
retained by Metromedia for the purpose of providing services to MIG. Nothing
contained in this Section or elsewhere in this Agreement will be construed as
conferring any benefit whatsoever upon any person or entity other than MIG.
3.2 Indemnification. Except as otherwise set forth in the first
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sentence of Section 3.1 hereof, Metromedia will not be liable for, and MIG will
indemnify and save and hold Metromedia harmless from and against, any and all
damages, liabilities, losses, claims, actions, suits, proceedings, fees, costs
or expenses (including, but not limited to, reasonable attorneys' fees and other
costs and expenses incident to any suit, proceeding or investigation of any
claim) of whatsoever kind and nature (all of the foregoing hereinafter
collectively referred to as "Expenses") imposed on, incurred by or asserted
against Metromedia at any time during or after the term of this Agreement
(whether because of an act or omission by Metromedia or otherwise unless such
act or omission is determined to be a result of the gross negligence or willful
misconduct of Metromedia) in any way relating to or arising out of the
performance by Metromedia of its duties hereunder.
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ARTICLE 4
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MISCELLANEOUS
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4.1 Notices. Any notice, request, demand, waiver or consent required
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or permitted hereunder will be deemed to have been given or made only if in
writing and either delivered or sent by prepaid telegram or prepaid registered
or certified mail, return receipt requested or by courier service or by
facsimile transmission with confirmation of receipt, addressed as follows:
If to MIG:
Metromedia International Group, Inc.
000 Xxxx Xxxxx Xxxxx Xxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: General Counsel
FAX: (000)000-0000
If to Metromedia, to:
Metromedia Company
Xxx Xxxxxxxxxxx Xxxxx
Xxxx Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: General Counsel
FAX: (000) 000-0000
The date of personal delivery, or the date of mailing of any such notice,
request, demand, waiver or consent, will be deemed to be three (3) business days
following the date of deposit with the U.S. Postal Service or one (1) business
day following the date of personal delivery or deposit with a courier or
facsimile transmission. Any party may change its address for the purpose of
notice by giving like notice in accordance with the provisions of this Section
4.1.
4.2 Conflict with Other Agreements. If any provision of this
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Agreement conflicts with the provisions of any material agreement by which
either Metromedia or MIG is bound which conflict constitutes a material breach
of such other material agreement, then the parties will modify the agreement so
as to eliminate such breach or cause such breach to be not material.
4.3 Assignment. This Agreement may not be assigned by MIG.
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4.4 Binding Effect. This Agreement will be binding on and inure
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solely to the benefit of the parties hereto.
4.5 Survival. The termination of this Agreement will not extinguish
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any covenant contained in this Agreement which by its terms survives the
termination of this Agreement or continues for a specific period of time
thereafter.
4.6 Separability. Any provision of this Agreement which is
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prohibited or unenforceable in any jurisdiction will, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction will not invalidate or render unenforceable
such provision in any other jurisdiction.
4.7 Further Assurances. From time to time after the signing hereof,
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each of the parties will, at the request of the other party, and without further
consideration, execute, acknowledge and deliver to the other party any and all
instruments and other writings and do all other acts or things reasonably
requested by the other party in order to evidence and effectuate the
consummation of any of the transactions contemplated by this Agreement.
4.8 No Joint Venture. Nothing in this Agreement will be construed
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or inferred to imply that Metromedia is a partner or joint venturer with MIG.
All employees, agents or representatives employed by or used by Metromedia in
its performance of this Agreement will be the employees, agents and
representatives of Metromedia and not of MIG. MIG will not represent to others
nor take any action from which others could infer it is a partner of or joint
venturer with Metromedia.
4.9 Power of Attorney. MIG hereby appoints Metromedia its attorney-
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in-fact for MIG during the term of this Agreement and authorizes Metromedia, in
the name or on behalf of MIG, to make, execute, deliver, acknowledge, swear to,
file and record all documents as may be necessary in the discretion of
Metromedia, in the performance by Metromedia of its duties and services
hereunder.
4.10 Entire Agreement, etc. This Agreement and the documents and
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instruments delivered pursuant hereto
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contain the entire agreement between the parties with respect to the subject
hereof and supersede any and all prior agreements, arrangements or
understandings relating to the subject matter hereof. No representations,
warranties, covenants or conditions, express or implied, other than as set forth
herein, have been made by any party. No waiver or extension of time for
performance of any term, provision or condition of this Agreement, whether by
conduct or otherwise, in any one or more instances will be deemed to be
construed as a further or continuing waiver or extension of any such term,
provision or condition of this Agreement. This Agreement cannot be changed or
terminated orally, and no waiver, extension or consent will be effective unless
evidenced by an instrument in writing duly executed by the party who is sought
to be charged with having granted the same. The Article and Section headings of
this Agreement are for convenience of reference only and do not form a part
hereof and do not in any way modify, interpret or construe the intentions of the
parties. This Agreement will be governed by and construed and enforced in
accordance with, and subject to, the laws of the State of New York applicable to
agreements made and to be performed entirely within the State of New York
without regard to the conflict of law principles thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized officers as of the date and year first
written above.
Metromedia Company Metromedia International Group, Inc.
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx X. Xxxxxx Name: Xxxxxx Xxxxxxxxx
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Title: Senior Vice President Title: Vice Chairman
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