1
EXHIBIT 10.48
EMPLOYMENT AGREEMENT
AGREEMENT, dated as of July 1, 1997, between Ticketmaster Corporation,
an Illinois Corporation (the "Company"), and Xxxxxxx X. Xxxxxxx ("Executive").
W I T N E S S E T H:
WHEREAS, the Company is desirous of employing Executive, and Executive
is desirous of being employed by the Company, on the terms and subject to the
conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the premises, the mutual covenants
and agreements contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby mutually acknowledged, the parties
hereto agree as follows:
1. DEFINITIONS. The following terms shall have the indicated meanings
when used in this Agreement, unless the context requires otherwise:
(a) "BASE SALARY AMOUNT" shall mean $200,000 during the first
Contract Year and $210,000 during the second Contract Year.
(b) "BOARD OF DIRECTORS" shall mean the Board of Directors of the
Company.
(c) "CAUSE" shall have the meaning ascribed to that term in
Section 7.
(d) "CONTRACT YEAR" shall mean each year during the term hereof
commencing on August 7 and ending on the immediately following August 6.
(e) "CUSTOMER" shall have the meaning ascribed to that term in
Section 9(d).
(f) "PROPRIETARY INFORMATION OF THE COMPANY" shall have the
meaning ascribed to that term in Section 10(a).
(g) "TICKETMASTER BUSINESSES" shall have the meaning ascribed to
that term in Section 9(b).
2
2. EMPLOYMENT. The Company hereby employs Executive, and Executive
hereby accepts employment with the Company, on the terms and subject to the
conditions set forth herein.
3. TERM OF EMPLOYMENT. The term of employment hereunder shall commence
on the date hereof and end on August 6, 1999, subject to early termination as
herein provided.
4. POSITION AND DUTIES. Executive shall serve as the Vice President and
Assistant General Counsel of the Company. He shall report directly to the
Company's Senior Vice President and General Counsel. Subject to the authority of
the Board of Directors and the Chief Executive Officer of the Company, the
Executive shall have all of the powers and duties incident to the office of Vice
President and such other powers and duties as may from time to time be
prescribed by the Board of Directors or the Chief Executive Officer of the
Company. Executive agrees to serve without further compensation, if elected or
appointed thereto, as an officer or a director of any of the Company's domestic
and foreign subsidiaries and affiliates. During Executive's employment by the
Company, he will be entitled to indemnification as an officer of the Company
(and, if so elected, as an officer or director of any of the Company's domestic
and foreign subsidiaries or affiliates) in the manner provided by the Illinois
Business Corporation Act of 1983, as amended, and the Company's Articles of
Incorporation and By-Laws.
5. EXCLUSIVE DUTIES. During Executive's employment by the Company,
Executive shall devote his entire working time, attention and energies to the
business of the Company and will not take any actions of the kind described in
Sections 9(b), 9(c) and 9(d).
6. COMPENSATION AND OTHER BENEFITS.
(a) BASE SALARY. During each Contract Year of the term hereof,
the Company shall pay to Executive the Base Salary Amount. The Base
Salary Amount shall be paid to Executive in accordance with the
Company's regular payroll practices with respect to senior management
compensation.
In the event that Executive shall become disabled as a result of
bodily injury or physical or mental illness (whether or not
occupational) to such extent that in the sole opinion of the Board of
Directors, based upon competent medical
-2-
3
advice, he can no longer perform the duties of Vice President of the
Company (a "Disability"), the Company shall only be obligated to
continue to pay the Base Salary Amount to Executive for the 120-day
period immediately following the date of Disability (the "Disability
Period"). The right to receive salary payments during the Disability
Period, if applicable, shall survive any termination of employment by
virtue of Disability pursuant to Section 7.
(b) ANNUAL PERFORMANCE BONUSES. During each Contract Year, the
Company shall pay Executive such annual performance bonus as determined
by the Chief Executive Officer, in his sole discretion; provided,
however, in no event shall any such annual bonus be less than $15,000
during the first Contract Year and $20,000 during the second Contract
Year.
(c) EXPENSES. Executive shall be entitled to receive prompt
reimbursement from the Company for all documented business expenses
incurred by him in the performance of his duties hereunder, provided
that Executive properly accounts therefor in accordance with the
Company's reimbursement policy, including, without limitation, the
submission of supporting evidence as reasonably requested by the
Company. While traveling on Company business, Executive shall be
entitled to transportation and accommodations consistent with other
senior executives of the Company.
(d) FRINGE BENEFITS. During the term hereof, Executive shall be
entitled to receive the following benefits: (i) participation in the
Company's standard medical, dental, life and disability insurance plans
(in accordance with the terms of said plans), (ii) participation in the
company's ExecuCare insurance plan consistent with participation in said
plan by other senior management of the Company, and (iii) participation
in the Company's IRS Section 401(k) plan (in accordance with the terms
of said plan). Additionally, during the term hereof, Executive shall be
entitled to receive an automobile allowance in the amount of $7800 per
year, payable monthly, in advance.
(e) VACATIONS. During the term hereof, Executive shall be
entitled to sick leave and paid holidays consistent with the Company's
sick leave and holiday policy for senior
-3-
4
management and up to three weeks paid vacation during each Contract Year
(or such other vacation time as is consistent with the Company's policy
for senior management).
(f) LIFE INSURANCE. The Company agrees to maintain in effect
during the term hereof insurance on Executive's life payable to his
estate or his named beneficiary or beneficiaries in the amount of
$500,000; provided, however, that Executive shall reimburse the Company
for any and all premiums paid by the Company with respect to such
insurance in excess of the preferred or select premium rate for
non-smokers.
7. TERMINATION. The Company or Executive may terminate the employment of
Executive hereunder upon the occurrence of a Disability (as defined in Section
6(a)) for a period of no less than 120 days during any consecutive twelve-month
period. The Company may also terminate the employment of Executive hereunder
upon Executive's death or for Cause. For purposes hereof, "Cause" shall mean (i)
fraud, theft, misappropriation of funds or conviction of a felony, (ii)
Executive's engagement in illegal conduct tending to place Executive or the
Company in disrepute, (iii) dereliction or gross misconduct in Executive's
performance of his duties as an employee of the Company or the failure of
Executive to perform his duties in a manner consistent with the instructions of
the Board of Directors or the Chief Executive Officer of the Company or (iv)
violation by Executive of any of his material covenants contained in this
Agreement, including, without limitation, Section 10. Notwithstanding the
foregoing, before the Company may terminate the employment of Executive for
Cause, the Company shall deliver to Executive not less than ten business days
prior written notice of the Company's intention to terminate Executive's
employment together with a statement of the basis for such termination, and
Executive shall be afforded (i) an opportunity to respond to the Company during
such ten-business day period and (ii) in the event that the basis for such
termination is clause (iii) or (iv) above, and the situation resulting in the
Company's determination to terminate for cause is non-repetitive in nature, the
right to remedy such situation so that such termination is no longer effective.
Upon the termination of Executive's employment for any reason, Executive shall
be entitled to receive all compensation for the then current Contract Year
through the date of such termination plus all accrued but unreimbursed
-4-
5
expenses. In addition, upon the termination of Executive's employment for any
reason other than for or by virtue of Cause, death, disability or Executive's
voluntary termination of employment, the Company shall continue to be
responsible for the payment of the Base Salary Amount for the remainder of the
term hereof; provided, however, that Executive shall have a duty to mitigate
commencing on the first anniversary of the date of termination; and, further
provided that Executive shall perform his covenants, duties and obligations
under Sections 9(b), 9(c) and 9(d) during the remainder of the term hereof.
Termination of Executive's employment for any reason whatsoever shall not affect
Executive's ability to exercise stock options that have vested prior to the date
of termination.
8. DEVELOPMENTAL RIGHTS. Executive agrees that any developments by way
of invention, design, copyright, trademark or other matters which may be
written, developed, or perfected by him during the term hereof, and which relate
to the business of the Company or its subsidiaries or affiliates, shall be the
property of the Company without any interest therein by Executive, and he will,
at the request and expense of the Company, apply for and prosecute letters
patent thereon in the United States or in foreign countries, and any renewals
thereof, if the Company so requests, and will assign and transfer the same to
the Company together with any letters patent, copyrights, trademarks or other
ownership rights therein or applications therefor or renewals thereof and any
revenues or rights to revenues arising therefrom; provided, however, that the
foregoing shall not apply to an invention that Executive develops entirely on
his own time without using the Company's equipment, supplies, facilities or
trade secret information except for those inventions that either:
-5-
6
(a) relate at the time of conception or reduction to practice of
the invention to the Company's business, or actual or demonstrably
anticipated research or development of the Company; or
(b) result from any work performed by Executive for the Company.
9. CONSULTING.
(a) CONSULTING SERVICES. During the one-year period commencing
immediately upon the termination of Executive's employment for any
reason (other than Executive's death) (the "Consulting Period"),
Executive shall be available for consultation with the Company and its
subsidiaries and affiliates concerning their general operations and the
industries in which they engage in business. In addition, during the
Consulting Period, consultant will aid, assist and consult with the
Company and its subsidiaries and affiliates with respect to their
dealings with clients and the enhancement of their recognition and
reputation. During the Consulting Period, Executive shall devote such
time and energies to the affairs of the Company as may be reasonably
required to carry out his duties hereunder without jeopardizing
Executive's then full-time, non-Ticketmaster Business employment
opportunities; provided, however, that Executive shall not be obligated
to devote more than 50 hours per year to the performance of such duties.
In consideration of Executive's consulting services, and in
consideration of Executive's covenants contained in this Section 9, the
Company shall pay to Executive $10,000 during each full year of the
Consulting Period, payable in equal monthly installments. The Company
further agrees to reimburse Executive for all reasonable and necessary
business expenses incurred by Executive in the performance of his
consulting services in accordance with the Company's reimbursement
policy, including, without limitation, the submission of supporting
evidence as reasonably required by the Company.
(b) COVENANT NOT TO COMPETE. During the Consulting Period,
Executive shall not, without the prior written consent of the Company,
directly or indirectly engage in or assist any activity which is the
same as, similar to or competitive with
-6-
7
the Ticketmaster Businesses (other than on behalf of the Company or any
of its subsidiaries or affiliates) including, without limitation,
whether such engagement or assistance is as an officer, director,
proprietor, employee, partner, investor (other than as a holder of less
than 5% of the outstanding capital stock of a publicly traded
corporation), guarantor, consultant, advisor, agent, sales
representative or other participant, anywhere in the world that the
Company or any of its subsidiaries or affiliates has been engaged,
including, without limitation, the United States, Canada, Mexico,
England, Ireland, Scotland, Europe and Australia. Nothing herein shall
limit Executive's ability to own interests in, advise, consult with, be
employed by, perform legal services for or manage entities which sell
tickets as an incidental part of their primary businesses (e.g. cable
networks, on-line computer services, sport teams, arenas, hotels, cruise
lines, theatrical and movie productions and the like) and which do not
hold themselves out generally as competitors of the Company and its
subsidiaries and affiliates. The "Ticketmaster Businesses" shall mean
the computerized sale of tickets for sporting, theatrical, cinematic,
live theatrical, musical or any other events on behalf of various venues
and promoters through distribution channels currently being utilized by
the Company or any of its subsidiaries or affiliates (as such term is
defined in Rule 405 of Regulation C promulgated under the Securities Act
of 1933, as amended).
(c) SOLICITATION OF EMPLOYEES. During the Consulting Period,
Executive shall not (i) directly or indirectly induce or attempt to
induce (regardless of who initiates the contact) any person then
employed (whether part-time or full-time) by the Company or any of its
subsidiaries or affiliates, whether as an officer, employee, consultant,
adviser or independent contractor, to leave the employ of the Company or
to cease providing or otherwise alter the services then provided to the
Company or to any of its subsidiaries or affiliates or (ii) in any other
manner seek to engage or employ any such person (whether or not for
compensation) as an officer, employee, consultant, adviser or
independent contractor in connection with the operation of any business
which is the same as or similar to any of the Ticketmaster Businesses.
-7-
8
(d) NON-SOLICITATION OF CUSTOMERS. During the Consulting Period,
Executive shall not solicit any Customers of the Company or any of its
subsidiaries or affiliates or encourage (regardless of who initiates the
contact) any such Customers to use the facilities or services of any
Competitor of the Company or any of its subsidiaries or affiliates.
"Customer" shall mean any person who engages the Company or any of its
subsidiaries or affiliates to sell, on its behalf as agent, tickets to
the public.
10. CONFIDENTIALITY. Executive shall not at any time (during or for a
period of sixty (60) months after termination of employment) disclose (except as
may be required by law) or use, except in the pursuit of the business of the
Company or any of its subsidiaries or affiliates, any Proprietary Information of
the Company. "Proprietary Information of the Company" means all information
known or intended to be known only to employees of the Company or any of its
subsidiaries or affiliates in a confidential relationship with the Company or
any of its subsidiaries or affiliates relating to technical matters pertaining
to the business of the Company or any of its subsidiaries or affiliates, but
shall not include any information within the public domain. Executive agrees not
to remove any documents, records or other information from the premises of the
Company or any of its subsidiaries or affiliates containing any such proprietary
information, except in the pursuit of the business of the Company or any of its
subsidiaries or affiliates, and acknowledges that such documents, records and
other information are the exclusive property of the Company or its subsidiaries
or affiliates. Upon termination of Executive's employment, Executive shall
immediately return all Proprietary Information of the Company and all copies
thereof to the Company.
11. GENERAL PROVISIONS.
(a) EXPENSES. All costs and expenses incurred by either of the
parties in connection with this Agreement and any transactions
contemplated hereby shall be paid by that party.
(b) NOTICES. All notices, demands and other communications
hereunder shall be in writing and shall be given or made (and shall be
deemed to have been duly given or made upon receipt) by delivery in
person, by overnight courier
-8-
9
service, by cable, by telecopy, by telegram, by telex or by registered
or certified mail to the respective parties at the following addresses
(or at such other address for a party as shall be specified in a notice
given in accordance with this Section 11(b)):
(i) If to the Company:
Ticketmaster Corporation
0000 Xxxxxx Xxxxxxxxx
Xxxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Telecopy No.: (000) 000-0000
With a copy to:
Xxxx Xxxxxx & Xxxxxxxxx
Xxx Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxx Gerber
Telecopy No.: (000) 000-0000
(ii) If to Executive:
Xxxxxxx X. Xxxxxxx
0000 Xxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: (000) 000-0000
(c) HEADINGS. The descriptive headings contained in this
Agreement are for convenience of reference only and shall not affect in
any way the meaning or interpretation of this Agreement.
(d) SUCCESSORS; BINDING AGREEMENT. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective heirs, devisees, legatees, executors, administrators,
successors and personal or legal representatives. If Executive is
domiciled in a community property state or a state that has adopted the
Uniform Marital Property Act or equivalent or if Executive is domiciled
in a state that grants to his spouse any other marital rights in
Executive's assets (including, without limitation, dower
-9-
10
rights or a right to elect against Executive's will or to claim a forced
share of Executive's estate), this Agreement shall also inure to the
benefit of, and shall also be binding upon, his spouse. If Executive
should die while any amounts would still be payable to him hereunder if
he had continued to live, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to
Executive's designee or, if there be no such designee, to Executive's
heirs, devisees, legatees or executors or administrators of Executive's
estate, as appropriate.
(e) SEVERABILITY. If any provision of this Agreement is held to
be illegal, invalid or unenforceable under existing or future laws
effective during the term of this Agreement, such provisions shall be
fully severable, the Agreement shall be construed and enforced as if
such illegal, invalid or unenforceable provision had never comprised a
part of this Agreement, and the remaining provisions of this Agreement
shall remain in full force and effect and shall not be affected by the
illegal, invalid or unenforceable provision or by its severance from
this Agreement. Furthermore, in lieu of such illegal, invalid or
unenforceable provision, there shall be added automatically as part of
this Agreement a provision as similar in terms to such illegal, invalid
or unenforceable provision as may be possible and be legal, valid and
enforceable.
(f) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter
hereof and thereof and supersedes all prior agreements and
understandings, both written and oral, between the Company and Executive
with respect to the subject matter hereof and thereof.
(g) ASSIGNMENT. This Agreement and the rights and duties
hereunder are not assignable by Executive. This Agreement and the rights
and duties hereunder may not be assigned by the Company without the
express written consent of Executive (which consent may be granted or
withheld in the sole discretion of Executive), except that such consent
shall not be required in order for the Company to assign this Agreement
or the rights or duties hereunder to an affiliate (as such term is
defined in Section 9(b)) of the Company or to
-10-
11
a third party in connection with the merger or consolidation of the
Company with, or the sale of all or substantially all of the assets or
business of the Company to, that third party.
(h) AMENDMENT; WAIVER. This Agreement may not be amended or
modified except by an instrument in writing signed by, or on behalf of,
the Company and Executive. Either party to this Agreement may (a) extend
the time for the performance of any of the obligations or other acts of
the other party or (b) waive compliance with any of the agreements or
conditions of the other party contained herein. Any such extension or
waiver shall be valid only if set forth in an instrument in writing
signed by the party to be bound thereby. Any waiver of any term or
condition shall not be construed as a waiver of any subsequent breach or
a subsequent waiver of the same term or condition, or a waiver of any
other term or condition, of this Agreement. The failure of any party to
assert any of its rights hereunder shall not constitute a waiver of any
such rights.
(i) GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Illinois,
applicable to contracts executed in and to be performed entirely within
that state.
(j) JURISDICTION AND VENUE. The parties hereto agree that all
actions or proceedings initiated by either party hereto and arising
directly or indirectly out of this Agreement which are brought pursuant
to judicial proceedings shall be litigated in a Federal or state court
located in the State of California. The parties hereto expressly submit
and consent in advance to such jurisdiction and agree that service of
summons and complaint or other process or papers may be made by
registered or certified mail addressed to the relevant party at the
address to which notices are to be sent pursuant to Section 11(b) of
this Agreement. The parties hereto waive any claim that a Federal or
state court located in the State of California is an inconvenient forum
or an improper forum based on lack of venue.
(k) EQUITABLE RELIEF. Executive acknowledges that the covenants
contained in Sections 9 and 10 are reasonable and necessary to protect
the legitimate interests of the Company,
-11-
12
that in the absence of such covenants the Company would not have entered
into this Agreement, that any breach or threatened breach of such
covenants will result in irreparable injury to the Company and that the
remedy at law for such breach or threatened breach would be inadequate.
Accordingly, the Executive agrees that the Company, in addition to any
other rights or remedies which it may have, shall be entitled to seek
such equitable and injunctive relief as may be available from any court
of competent jurisdiction to restrain the Executive from any breach or
threatened breach of such covenants.
(l) ATTORNEYS' FEES. If any legal action or other proceeding is
brought for the enforcement of this Agreement, the prevailing party
shall be entitled to recover reasonable attorneys' fees and other costs
incurred in that action or proceeding, in addition to any other relief
to which it may be entitled.
(m) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and by the parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original while all of
which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and Executive have executed this
Agreement as of the date and year first written above.
TICKETMASTER CORPORATION
By:
---------------------------------
Title:
-------------------------------
------------------------------------
XXXXXXX X. XXXXXXX, an individual
-12-
