EXHIBIT 10.21
EMPLOYMENT AGREEMENT
THIS AGREEMENT entered into as of the 1st day of August, 2001 (the
"Effective Date"), by and between Small Town Radio, Inc. (the "Company"), a
Georgia corporation, and Xxxxxx X. Xxxx, an individual (the "Executive")
(hereinafter collectively referred to as "the parties").
WHEREAS, the Company and the Executive desire to establish an
employment relationship on the terms set forth herein;
NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:
1. Employment Term. Subject to the terms and provisions of this
Agreement, the Company hereby agrees to employ the Executive and the Executive
hereby agrees to be employed by the Company for a period of two (2) years
commencing on the date hereof, unless terminated sooner as hereinafter provided
(the "Employment Term"). This Agreement may be renewed upon terms and conditions
to be agreed upon by the parties in writing.
2. Duties.
(a) The Executive's Duties and Responsibilities. During the Employment
Term the Executive shall serve as Chief Financial Officer of the Company. The
Executive shall perform such services and duties as are incident to such
position and such other duties as determined from time to time by the Board of
Directors of the Company (the "Board") which are consistent with such position.
The Executive's duties shall include, without additional compensation, the
performance of similar services for any Affiliates (as defined below) of the
Company as may be reasonably requested by the Board from time to time.
(b) Other Business Activities. The Executive shall devote his full
business time, attention and skills to the performance of such duties, services
and responsibilities, and will use his best efforts to promote the interests of
the Company. The Executive will not, without the prior written approval of the
Board, engage in any other business activity which would interfere with the
performance of his duties, services and responsibilities hereunder or which is
in violation of policies established from time to time by the Company and
provided to the Executive. Without the written consent of the Company, the
Executive shall not serve as an officer, director, manager, consultant or
advisor to any other business, and shall not engage in any other business
activities other than the permitted activities, as herein defined. The Executive
may: (i) make and manage personal business investments of his choice, provided,
however, that the Executive shall hold no investment in any entity which
competes in any way with the Company, other than an investment representing less
than 1% interest in any publicly held entity; and (ii) participate in civic,
educational and charitable activities (collectively the "permitted activities")
without seeking or obtaining approval by the Board provided that the permitted
activities do not materially interfere or conflict with the Executive's ability
to perform his duties as an officer of the Company or cause any conflict of
interest with such duties. An "Affiliate" of the Company shall mean any entity,
whether a corporation, firm, partnership or other legal entity or business unit
or division that directly or indirectly controls, is controlled by, or is under
common control with the Company.
3. Compensation. To induce the Executive to continue in the capacity
designated in Section 2(a) for the Company and in consideration of the
performance by the Executive of the Executive's obligations during and after the
Employment Term (including any services as an officer, director, employee,
member of any committee of the Company, or otherwise), the Company will
compensate the Executive in the following manner:
(a) Base Salary. During the Employment Term the Company will pay the
Executive a salary (the "Base Salary") at an annual rate of not less than
$120,000, payable in monthly payments of ten thousand dollars ($10,000), all of
which will be paid in accordance with the normal payroll practices of the
Company then in effect for other officers of the Company. The Board shall have
the authority, in its sole discretion, to adjust such Base Salary and will
review it in conjunction with a significant change in the scale and scope of the
Executive's duties.
(b) Management Performance Incentives. The Executive may receive
additional management performance bonuses in the form of stock options or by
other means authorized pursuant to any stock incentive plan then in effect or
otherwise at the discretion of the Board and any Compensation Committee
appointed thereby.
4. Benefits. During the Employment Term, the Executive shall be
entitled to participate in any employee benefit plans (including, but not
limited to, any life insurance, disability, medical, dental, hospitalization,
savings, retirement and other benefit plans of the Company) then in effect for
executive officers and receive any other fringe benefits that the Company then
provides to executive officers of the Company to the extent the Executive meets
the eligibility requirements for any such plan or benefit.
5. Reimbursement for Medical Insurance Expenses. The Company shall
reimburse the Executive for the ordinary and reasonable costs for medial
insurance expenses for the Executive's own person. The Executive shall submit
for reimbursement proof of payment pursuant to a process to be established
between the Executive and the Company.
6. Reimbursements for Business Expenses. Subject to compliance by the
Executive with such policies regarding expenses and expense reimbursement as may
be adopted from time to time by the Company, during the Employment Term, the
Executive is authorized to incur reasonable expenses in the performance of his
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duties hereunder in the furtherance of the business of the Company and the
Company shall reimburse the Executive for all such reasonable expenses upon
submission of proper substantiation. The Executive shall receive a monthly
automobile allowance in the gross amount of $500 and a one-time relocation
allowance in the gross amount of $25,000. Any taxes due on the one-time
relocation allowance shall be paid by the Executive.
7. Temporary Housing Expenses. For up to six months from the Effective
Date, the Company shall reimburse the Executive for reasonable temporary housing
expenses (the "Temporary Housing Expenses"). The Temporary Housing Expenses
shall be pre-approved, in writing, by the Company prior to the Executive
incurring such Temporary Housing Expenses. The Executive shall submit for
reimbursement proof of payment pursuant to a process to be established between
the Executive and the Company.
8. Vacations. During the Employment Term, the Executive shall be
entitled to accrue paid vacation time in accordance with the policies of the
Company in effect from time to time that concern executives of the Company in
comparable positions.
9. Termination. Anything in this Agreement to the contrary
notwithstanding, this Agreement and the employment of the Executive pursuant
hereto shall terminate upon the first to occur of the following events:
(a) The death of the Executive.
(b) Immediately for "Cause." For purposes of this Agreement, "Cause"
means (i) a material breach of this Agreement; (ii) an act or acts of theft,
fraud, or other criminal or intentional tortious misconduct, regardless of
whether criminal or civil proceedings are initiated or a verdict or judgment
against the Executive is entered; (iii) any improper or unethical business
activity, including but not limited to, the Executive's fraud, misappropriation,
embezzlement, dishonesty, unlawful harassment or gross negligence; (iv) the
Executive's failure to perform his assigned duties or comply with the Company's
stated policies or procedures; or (v) an inability to perform the essential
functions of the job, even with reasonable accommodations by the Company, for
thirty (30) days or more.
(c) The lapse of ten (10) days following written notice by the Company
to the Executive of termination for any reason or no reason.
(d) The lapse of thirty (30) days following written notice by the
Executive to the Company of his resignation from the Company; provided, however,
that the Company, in its discretion, may cause such termination to be effective
at any time during such thirty (30) day period.
10. Notice of Termination. Any termination by the Company shall be
communicated in writing to the Executive in accordance with Section 20(b) of
this Agreement and if the termination date is other than the date of receipt,
the notice shall specify the termination date.
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11. Obligations of the Company Upon Termination. The following
provisions apply only in the event the Executive is terminated during the
Employment Term or any Renewal Term:
(a) Death. If the Executive's employment is terminated by reason of the
Executive's death, this Agreement shall terminate without further obligation to
the Executive's legal representatives under this Agreement other than those
payment amounts accrued and payable hereunder at the date of the Executive's
death. Anything in this Agreement to the contrary notwithstanding, the
Executive's family shall be entitled to receive benefits at least equal to those
provided by the Company to surviving families of executives of the Company in
comparable positions under such plans, programs and policies relating to family
death benefits, if any.
(b) Disability. If the Executive's employment is terminated by reason
of the Executive's disability pursuant to Section 9(b)(v), the Executive may be
eligible to receive disability and other benefits at least equal to those
provided by the Company to disabled employees and/or their families in
accordance with such plans, programs and policies relating to disability, if
any. In the event of the Executive's disability, the Company shall have no
further obligation to the Executive under this Agreement and the Executive will
no longer be required to perform his duties hereunder and will relinquish such
duties to a successor selected by the Board.
(c) Cause. If the Executive's employment is terminated for Cause, the
Company shall pay the Executive his Base Salary through the date of termination
at the rate in effect at the time notice of termination is given, and the
Company shall have no further obligation to the Executive under this Agreement.
(d) Termination Without Cause. Expressly conditioned on and in
consideration of the Executive's full compliance with Sections 13 and 14 of this
Agreement, if the Company shall terminate the Executive's employment with the
Company without cause, the Company shall pay to the Executive (i) promptly, upon
submission by the Executive of supporting documentation, any business related
costs and expenses (including already accrued moving and relocation expenses)
paid or incurred by the Executive on or before the date of termination which
would have been payable under Section 6 if the Executive's employment had not
terminated; and (ii) his then Base Salary for a period of one (1) year from the
date of termination in twelve (12) substantially equal monthly installments, and
in the case of vested compensation previously deferred by the Executive, all
amounts of such compensation previously deferred and not yet paid by the
Company.
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12. Termination by the Executive. The Executive may terminate his
employment under this Agreement at any time upon thirty (30) days notice to the
Company. In such event, the Executive, if requested by the Company, shall
continue to render his services and shall be paid his regular salary and receive
his normal benefits up to the date of termination.
13. Nondisclosure of Trade Secrets and Confidential Information.
(a) As used in this Agreement, the term "Trade Secrets" shall mean
information which (i) derives economic value, actual or potential, from not
being generally known to, and not being readily ascertainable by proper means
by, other persons who can obtain economic value from its disclosure or use, and
(ii) is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy. Such information shall include, but not be limited to,
technical or non-technical data, formulas, patterns, programs, methods,
techniques, processes, financial data, financial plans, product plans or lists
of actual or potential customers or suppliers. This definition shall not limit
any definition of "trade secrets" under state or federal law.
(b) Throughout the term of this Agreement and for as long as the
applicable Trade Secrets remain secret, the Executive shall not directly or
indirectly use, transmit, misappropriate, or disclose any such Trade Secret of
the Company or of any client or customer of the Company for any purpose, whether
directly or indirectly, for himself or for or on behalf of others, without the
prior written consent of the Company.
(c) As used in this Agreement, the term "Confidential Information"
shall mean all information regarding the Company, the Company's activities, the
Company's business or the Company's clients that is not generally known to
persons not employed by the Company but does not rise to the level of a Trade
Secret and that is not generally disclosed by the Company practice or authority
to persons not employed by the Company. "Confidential Information" shall not
include information that has become generally available to the public by the act
of one who has the right to disclose such information without violating any
right or privilege of the Company.
(d) Throughout the term of this Agreement and for a period of two (2)
years after the date this Agreement terminates for any reason, the Executive
shall not directly or indirectly use, transmit, misappropriate or disclose any
Confidential Information of the Company or any confidential information of any
client or customer of the Company to any person, concern or entity, for any
purpose, whether directly or indirectly, for himself or for others, without the
prior written consent of the Company.
14. Proprietary Rights in Developments. In the course of rendering his
services to the Company, the Executive may conceive, create or develop ideas,
concepts, methods of operation, processes, programs or other matter or material,
whether or not constituting an advance to, or an improvement of, or pertaining
to existing Company proprietary matter (all of which are hereinafter referred to
as "Developments"). All Developments shall constitute Confidential Information
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(and may constitute Trade Secrets) and shall be subject to all of the
restrictions imposed on the Executive pursuant to this Agreement. In addition,
all Developments and all rights therein throughout the world constitute works
made for hire and in all circumstances shall be and remain the sole and
exclusive property of the Company whether or not protected under any laws now
known or hereafter applicable, including but not limited to patent, copyright,
trademark or trade secret laws.
(a) The Executive hereby assigns to the Company all rights throughout
the world, however denominated (whether under patent, copyright, trademark,
trade secret or like or different laws), in all media, now known or hereafter
recognized, in and to each such Development. This assignment is not intended to
derogate any rights the Company has as an author of a work made for hire. In
order to fully effectuate these provisions, the Executive hereby represents and
warrants that, with respect to each such Development: (i) to the extent of the
Executive's contribution, all such matter is original and does not and will not
infringe or violate the rights of any other person or entity; and (ii) that
neither the Executive nor anyone on his behalf have granted or will grant or
purport to grant to any other person or entity any rights, in whole or in part,
in and to such Developments.
(b) Cooperation. The Executive shall, during and after termination of
the Executive's employment, cooperate with the Company in the prosecution or
defense of any claims, litigation, or other proceedings involving the
Developments and provide such information and execute such documents as the
Company may reasonably request to confirm, implement or enforce its rights in
such Developments. The Company shall be responsible for the expenses associated
with the filing of any patent, copyright, trademark or like applications.
15. Violation of Sections 13 or 14. If at any time the Board determines
in good faith that the Executive has violated or has attempted to violate
Section 13 or 14 hereof, and if the Executive is receiving severance payments
pursuant to Section 11(d) hereof, the Company shall cease making and shall no
longer be obligated to make the severance payments described in Section 11(d).
This remedy shall be in addition to, and not in lieu of, any other remedies
(including injunctive relief) available to the Company for a violation of
Section 13 or 14.
16. Books and Records. All books, records and accounts relating in any
manner to the Company's clients and the Company's business, whether prepared by
the Executive or otherwise coming into the Executive's possession, and all
copies thereof in the Executive's possession, shall be the exclusive property of
the Company and shall be returned immediately to the Company upon termination of
the Executive's employment hereunder or upon the Company's request at any time.
17. Injunction. The Executive acknowledges that if he were to breach or
attempt to breach any of the provisions of Sections 13 or 14, it may result in
immediate and irreparable injury to the Company which cannot be adequately or
reasonably compensated at law. Therefore, the Executive agrees that the Company
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shall be entitled, if any such breach shall occur or be threatened or attempted,
if it so elects, to seek a decree of specific performance and/or to a temporary
and permanent injunction, without being required to post a bond, enjoining and
restraining such breach by the Executive, his associates, partners or agents,
either directly or indirectly, and that such right to seek an injunction shall
be cumulative to whatever remedies or actual damages the Company may possess.
18. Arbitration. Except as provided in Section 17 of this Agreement,
Company and the Executive hereby consent to the resolution by binding
arbitration of all claims or controversies for which a court otherwise would be
authorized by law to grant relief, in any way arising out of, relating to or
associated with the Executive's employment with the Company or its termination,
that the Company may have against the Executive or that the Executive may have
against the Company or against its officers, directors, employees or agents in
their capacity as such or otherwise.
19. Successors.
(a) This Agreement is personal to the Executive and without the prior
written consent of the Company the benefits accrued and payable hereunder shall
not be assignable by the Executive otherwise than by will or the laws of descent
and distribution. This Agreement shall inure to the benefit of and be
enforceable by the Executive's legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors.
(c) In the event that another corporation or unincorporated entity
becomes a Successor (as such term is defined below) of the Company, then the
Successor shall, by an agreement in form and substance reasonably satisfactory
to the Executive, expressly assume and agree to perform this Agreement in the
same manner and to the same extent as the Company be required to perform if
there had been no Successor. As used herein the term "Successor" means another
corporation or unincorporated entity or group of corporations or unincorporated
entities which (i) acquires all or substantially all of the assets of the
Company, or (ii) is the surviving entity as a result of the merger of the
Company into such entity.
20. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Georgia, without reference to principles of
conflict of laws. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.
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(b) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive:
-------------------
Xxxxxx X. Xxxx
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
If to the Company:
-----------------
Small Town Radio, Inc.
00000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
or to such other address as either party shall have furnished
to the other in writing in accordance herewith. Notice and communications shall
be effective when actually received by the addressee.
(c) If any term or provision of the Agreement or the application hereof
to any person or circumstances shall, to any extent, be invalid or
unenforceable, the remainder of this Agreement, or the application of such term
or provision to persons or circumstances other than those to which it is held
invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Agreement shall be valid and enforceable to the fullest extent
permitted by law. Moreover, if a court of competent jurisdiction deems any
provision hereof to be too broad in time, scope or area, it is expressly agreed
that such provision shall be enforced to a less degree which the court of
competent jurisdiction would find enforceable.
(d) The Company may withhold from any amounts payable under this
Agreement such federal, state and local taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
(e) This Agreement contains the entire understanding of the Company and
the Executive with respect to the subject matter hereof.
(f) Any waiver of any breach of this Agreement shall not be construed
to be a continuing waiver of consent to any subsequent breach by either party
hereto.
(g) The Executive shall not delegate the employment obligations
pursuant to this Agreement to any other person.
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IN WITNESS WHEREOF, the Executive has hereunto set his hand, and the
Company has caused these presents to be executed in its name on its behalf, all
as of the day and year first above written.
SMALL TOWN RADIO, INC.
/s/ Xxxxxx X. Xxxx By: /s/ Xxxxxx Xxxx
------------------------------- -----------------------------------
Xxxxxx X. Xxxx Name: Xxxxxx Xxxx
---------------------------------
Title: President
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