EXHIBIT NO. 10.3
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EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of February 1,
1996, by and between ▇▇▇▇▇ ▇▇▇▇▇ ("Employee") and PEOPLE'S CHOICE TV CORP., a
Delaware corporation (the "Company").
R E C I T A L S:
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A. The Company is in the business of developing, owning and operating
wireless cable television systems and conducting various other activities
associated therewith (the "Business").
B. The Company desires to employ Employee as Senior Vice President --
Operations and Marketing and Employee desires to be so employed by the Company,
on the terms and conditions set forth herein.
C. The Company desires to bind Employee to certain restrictive covenants
and Employee agrees to be so bound, on the terms and conditions set forth
herein.
A G R E E M E N T:
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NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Employment Term. Subject to the terms and conditions set forth herein,
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including Section 12, the Company will employ Employee and Employee will serve
as Senior Vice President -- Operations and Marketing for a three year term
commencing on the date hereof (the "Effective Date") and ending on the third
anniversary of the Effective Date (the "Employment Term").
2. Employment Duties.
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During the Employment Term, Employee will serve as Senior Vice
President -- Operations and Marketing, subject to the terms of this Agreement
and the direction and control of the Chairman and Chief Executive Officer of the
Company. Employee shall, during the Employment Term, be primarily based in the
Chicago metropolitan area and perform such duties for the Company and its
subsidiaries as may be assigned by the Chairman and Chief Executive Officer from
time to time and serve the Company and its subsidiaries faithfully, diligently
and competently and to the best of his ability.
3. Compensation. In exchange for Employee's services hereunder, the
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Company shall have the following compensation obligations, which shall be
cumulative:
(a) During the Employment Term, the Company shall pay to Employee as
salary for services rendered by Employee under this Agreement $135,000
per annum (the "Salary"). Such Salary shall be payable in arrears not
less frequently than monthly, but otherwise in accordance with the
Company's ordinary payment practices. Such Salary may be reviewed and
adjusted periodically at the Company's option.
(b) Employee shall be eligible to earn a structured bonus with a minimum
target of $40,000 per annum based on the attainment of certain
operating targets to be agreed upon by the Compensation Committee of
the Company's Board of Directors and Employee.
Any payments of Salary and Bonus made to Employee shall be treated as wages for
withholding and employment tax purposes.
4. Insurance. During the Employment Term, the Company shall be entitled
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to obtain as the beneficiary "key man" or similar other life insurance on
Employee in an amount that the Company shall in its discretion deem necessary.
Employee shall cooperate with all requirements necessary for obtaining such
insurance, including, without limitation, submitting to any tests or physicals
reasonably required by the insurers in order to obtain such insurance.
5. Benefits.
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(a) Employee shall be entitled during the Employment Term to participate
in such employee benefit plans and programs, including, without
limitation, the Company's current automobile allowance program which
provides for a payment of $8,000 per annum, life insurance program
which provides Employee with life insurance coverage in an amount
equal to three times his Salary and health insurance plans, as are
maintained from time to time for employees of the Company to the
extent that his position, tenure, compensation, age, health and other
qualifications make him eligible to participate, and the Company's
401(k) plan. The Company does not promise the adoption or continuance
of any particular plan or program during the Employment Term, and
Employee's (and his dependents') participation in any such plan or
program shall be subject to the provisions, rules, regulations and
laws applicable thereto.
(b) During the Employment Term, Employee shall be entitled to three (3)
weeks of paid vacation for each full twelve (12) month period during
the Employment Term, or such greater amount of vacation time which the
Company grants to its senior managers generally. Vacations taken by
Employee shall be taken at times mutually acceptable to Employee and
the Company; accumulated and unused vacation time may not be carried
beyond such twelve (12) month period. Except
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as expressly provided elsewhere in this Agreement, in the event an
Employee's employment is terminated under this Agreement, the
entitlement to paid vacation hereunder shall be reduced to correspond
to the portion of the applicable period the Employee remained employed
by the Company. Employee shall also be entitled to such paid holidays
as are observed by the Company from time to time.
6. Reimbursement of Expenses. Employee shall be entitled to reimbursement
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for ordinary, necessary and reasonable out-of-pocket trade or business expenses
which Employee incurs in connection with performing his duties under this
Agreement, including reasonable travel, meal and home relocation expenses. The
reimbursement of all such expenses shall be made upon presentation of evidence
reasonably satisfactory to the Company's Chairman and Chief Executive Officer
(or such other officer of the Company designated thereby) of the amounts and
nature of such expenses and shall be subject to the Company's policies regarding
business expenses and to the reasonable approval of the Company's Chairman and
Chief Executive Officer (or such other officer of the Company designated
thereby).
7. Restrictive Covenants. Employee acknowledges and agrees that (i)
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through his position as an employee of the Company, he will learn valuable trade
secrets and other proprietary information relating to the Business, (ii)
Employee's services to the Company are unique in nature, and (iii) the Company
would be irreparably damaged if Employee were to provide services to any person
or entity in violation of the restrictions contained in this Agreement.
Accordingly, as an inducement to the Company to enter into this Agreement and in
consideration of his employment hereunder, Employee agrees that during the
Employment Term and for an one year thereafter (such period being referred to
herein as the "Restricted Period"), neither Employee nor any Affiliate of
Employee (as defined below) shall, directly or indirectly, either for himself or
for any other person or entity:
(a) engage or participate in, or assist, advise or be connected with
(including as an employee, owner, partner, shareholder, officer,
director, advisor, consultant, agent or otherwise), or permit his name
to be used by or render services for, any person or entity engaged in
a Competing Business (as hereinafter defined); provided, however, that
nothing in this Agreement shall prevent Employee from acquiring or
owning, as a passive investment, up to one percent (1%) of the
outstanding voting securities of an entity engaged in a Competing
Business which is publicly traded on any recognized national
securities market;
(b) take any action which might divert from the Company or an Affiliate of
the Company any business which is within the scope of the Company's or
such Affiliate's then business, including but not limited to the pay
or subscription television business;
(c) solicit or attempt to solicit (i) any then subscriber or other
customer of the Company with whom the Employee had contact and/or
knowledge during the Employment Term to purchase Competing Products or
Services (as herein defined) from any person or entity (other than the
Company) or (ii) any then
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subscriber, customer, supplier, licensor, licensee or other business
relation of the Company with whom the Employee had contact and/or
knowledge during the Employment Term to cease doing business with the
Company; or
(d) solicit or hire any director, officer, employee or agent of the
Company or any Affiliate of the Company to perform services for any
entity other than the Company and its Affiliates.
As used herein, a "Competing Business" shall mean any company or person engaged
in, or planning to engage in, the business of providing pay or subscription
television services (whether through hard-wire, wireless or other transmissions)
to any customer in any market in which the Company or any Affiliate thereof is
or is planning during the Employment Term or on the termination thereof to
provide pay or subscription television services. Such markets shall include but
not be limited to Albuquerque, Chicago, Detroit, Houston, Indianapolis, Kansas
City, Milwaukee, Phoenix, St. Louis and Tucson. The products and services
subject to these restrictive covenants are herein referred to as "Competing
Products and Services".
8. Disclosure of Confidential Information. Employee recognizes that he
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possesses or as a result of his employment by the Company will gain possession
of Confidential Information (as defined below). Accordingly, as an inducement
for the Company to enter into this Agreement and in consideration of Employee's
employment, Employee agrees that:
(a) for the longest period permitted by law from the date of this
Agreement, Employee and each Affiliate of Employee shall hold in
strictest confidence and shall not, other than as required by law,
without the prior written consent of the Company, use for his own
benefit or that of any third party or intentionally or negligently
disclose in a manner which could be harmful to the Company to any
person, firm or corporation except the Company, an Affiliate of the
Company or employees of the Company or an Affiliate of the Company any
Confidential Information (as defined below). For purposes of this
Agreement, intending that the term shall be broadly construed to
include anything protectible as a trade secret under applicable law,
"Confidential Information" shall mean all information, and all
documents and other tangible items which record information, relating
to the creation and marketing by the Company of products and services,
from time to time, which at the time or times concerned is protectible
as a trade secret under applicable law, and which has been or is from
time to time learned by, disclosed to or known by Employee including,
without limitation, the following especially sensitive types of
information relating to the creation and marketing of products and
services of the Company:
(i) product development and marketing plans and strategies;
(ii) budgetary and financial information;
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(iii) wireless cable development or launch plans for new or
existing systems or services;
(iv) information concerning contractual relationships by and
among the Company its vendors, licensors, program suppliers, employees
or subscribers or other customers; and
(v) information concerning the character and scope of business
or personal relationships between employees, directors, and
consultants of the Company.
As used herein, an "Affiliate" shall mean and include any person or
entity which controls a party, which such party controls or which is under
common control with such party. "Control" means the power, direct or
indirect, to influence or cause the direction of the management and policies
of a person or entity through voting securities, contract or otherwise;
(b) Employee and each Affiliate of Employee (and if deceased, his legal
representative, who shall be the person set forth as such in Section
14(a) until written notice of a successor is delivered to the Company
(the "Representative")) shall promptly following a request therefor
from the Company return to the Company, without retaining copies, all
tangible items which are or which contain Confidential Information, it
being agreed by Employee on behalf of himself and his heirs,
successors and assigns that the Company shall be entitled to rely on
any action taken by Employee or the Representative in connection with
this paragraph (b); and
(c) at the request of the Company made at any time or from time to time
hereafter, Employee and each Affiliate of Employee (and if deceased,
the Representative) shall make, execute and deliver all applications,
papers, assignments, conveyances, instruments or other documents and
shall perform or cause to be performed such other lawful acts as the
Company may reasonably deem necessary or desirable to implement any of
the provisions of this Agreement, and shall give testimony and
cooperate with the Company, its Affiliates or its representatives in
any controversy or legal proceedings involving the Company, its
Affiliates or its representatives with respect to any Confidential
Information, provided that the Company shall promptly reimburse
Employee and each Affiliate thereof for his reasonable costs incurred
in connection with the foregoing, including but not limited to the
reasonable costs and expenses of legal counsel retained by Employee.
9. Inventions. Employee acknowledges that in his capacity as an employee
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of the Company, he may be involved in (i) the conception or making of
improvements, discoveries, inventions or the like (whether patentable or
unpatentable and whether or not reduced to practice), (ii) the authorship of
copyrightable works, or (iii) the development of trade secrets
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relating to the Business. Employee acknowledges that all such intellectual
property is the exclusive property of the Company. Employee hereby waives any
rights he may have in or to such intellectual property, and Employee hereby
assigns to the Company all right, title and interest in and to such intellectual
property. At the Company's request and at no expense to Employee, Employee shall
execute and deliver all such papers, including, without limitation, any
assignment documents, and shall provide such cooperation as may be necessary or
desirable, or as the Company may reasonably request, in order to enable the
Company to secure and exercise its rights to such intellectual property.
10. Specific Performance. Employee agrees that any violation by him of
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Sections 7, 8 or 9 of this Agreement, as applicable, would be highly injurious
to the Company and would cause irreparable harm to the Company. By reason of
the foregoing, Employee consents and agrees that if he violates any provision of
Sections 7, 8 or 9 of this Agreement the Company shall be entitled, in addition
to any other rights and remedies that it may have, to apply to any court of
competent jurisdiction for specific performance and/or injunctive or other
relief in order to enforce, or prevent any continuing violation of, the
provisions of such Section. In the event Employee breaches a covenant contained
in this Agreement, the Restricted Period applicable to Employee with respect to
such breached covenant shall be extended for the period of such breach.
11. Enforcement. Employee acknowledges that the territorial, time and
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scope limitations set for in Section 7 and 8, as applicable, are reasonable and
are properly required for the protection of the Company and in the event that
any such territorial, time or scope limitation is deemed to be unreasonable by a
court of competent jurisdiction, the Company and Employee agree, and Employee
submits, to the reduction of any or all of said territorial, time or scope
limitations to such an area, period or scope as said court shall deem reasonable
under the circumstances.
12. Termination; Severance.
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(a) Notwithstanding the provisions of Section 1 and the other provisions
of this Agreement, Employee's employment with the Company may be
terminated at any time for any reason or no reason by the Company's
Chairman and Chief Executive Officer or Board of Directors with or
without cause, provided that in the event of such a termination,
Employee shall be entitled to continuation of his Salary (under
Section 3(a)) and benefits (under Section 5) through the period (the
"Severance Period") ending twelve (12) months after the date of such
termination; provided that any such amount for Salary or benefit
continuation shall be reduced by any amount received or earned by
Employee during the Severance Period pursuant to any employment,
consulting or similar other relationship between Employee and any
other person. Except as otherwise specifically provided above, the
Company's obligations under this Agreement shall cease upon
termination and Employee shall forfeit all rights to receive any other
compensation or benefits under this Agreement. Without limitation, a
termination of Employee pursuant to this Section 12(b) shall not
relieve Employee of his obligations under Sections 7,
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8 or 9 hereof, and Employee is further obligated during the Severance
Period to promptly notify Company of any employment, consulting or
other relationship that might result in the reduction of any Salary or
benefit continuation payments hereunder and to provide to Company all
documents reasonably requested by it relating thereto. Any termination
by the Company under this Section 12(a) shall be in writing.
(b) Notwithstanding the provisions of Section 1 and the other provisions
of this Agreement, Employee's employment with the Company may be
terminated by Employee upon the provision of not less than six (6)
months prior written notice to the Company. In the event of
termination under this Section 12(b) and except as otherwise provided
herein, the Company's and Employee's obligations under this Agreement
shall cease upon the date indicated in Employee's notice or such
earlier date after the date of notice as selected by the Company in
its sole discretion and Employee shall forfeit all right to receive
any compensation or benefits under this Agreement, including, without
limitation, any unearned performance bonus, except that Employee shall
be entitled to his Salary (under Section 3(a)) and benefits (under
Section 5) for services already performed as of the date of
termination of this Agreement. Without limitation, termination of
Employee pursuant to this Section 12(b) shall not relieve Employee of
his obligations under Sections 7, 8 or 9 hereof.
13. Death or Disability.
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(a) If Employee becomes permanently disabled (determined as provided
below) during the Employment Term, his employment may terminate at the
election of the Company as of the date such permanent disability is
determined. Employee shall be considered to be permanently disabled
for purposes of this Agreement if he is unable by reason of accident
or illness (including mental illness) to perform the material duties
of his regular position with the Company and is not expected to
recover from his disability within a period of six (6) months from the
commencement of the disability. If at any time Employee claims or is
claimed by the Company to be permanently disabled, a physician
acceptable to both Employee, or the Representative, and the Company
(which acceptances shall not be unreasonably withheld) shall be
retained by the Company and shall examine Employee. Employee shall
cooperate fully with the physician. If the physician determines that
Employee is permanently disabled, the physician shall deliver to the
Company a certificate certifying both that Employee is permanently
disabled and the date upon which the condition of permanent disability
commenced. The determination of the physician shall be conclusive.
(b) Employee's right to his compensation and benefits under this Agreement
shall cease upon his death or disability, except that (i) Employee (or
his estate or heirs) shall be entitled to his Salary (under Section
3(a)) and benefits (under Section 5) for services performed as of the
date of his death or permanent disability and (ii)
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in addition, with respect to termination due solely to Employee's
permanent disability as determined pursuant to this Section 13, he
shall also be entitled to his Salary (under Section 3(a)) and benefits
(under Section 5), in the event the permanent disability began prior
to the second anniversary of the Effective Date, through the period
ending six (6) months after the date such permanent disability began
or, in the event the permanent disability began on or after the second
anniversary and before the end of the three (3) year Employment Term,
through the remainder of the Employment Term; provided, however, that
any such amounts for Salary continuation shall be reduced by any
amount received by Employee under any disability insurance policy or
other benefit program such as Social Security.
14. Miscellaneous.
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(a) All notices hereunder shall be in writing and shall be deemed given
when delivered in person, or three (3) business days after being
deposited in the United States mail, postage prepaid, registered or
certified mail, or two (2) business days after delivery to a
nationally recognized express courier, expenses prepaid, addressed as
follows:
If to Employee:
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If to the Representative:
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If to the Company:
People's Choice TV Corp.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
Chairman and Chief Executive Officer
and/or at such other addresses and/or to such other addressees as may be
designated by notice given in accordance with the provisions hereof.
(b) This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective heirs, successors and permitted
assigns. No party shall
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assign this Agreement or its rights hereunder without the prior
written consent of the other party hereto; provided, however, that the
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Company may assign this Agreement without the prior written consent of
Employee to any person or entity acquiring all or substantially all of
the Business of the Company (whether by sale of stock, sale of assets,
merger, consolidation or otherwise).
(c) This Agreement contains all of the agreements between the parties with
respect to the subject matter hereof and this Agreement supersedes all
other agreements, oral or written, between the parties hereto with
respect to the subject matter hereof.
(d) No change or modification of this Agreement shall be valid unless the
same shall be in writing and signed by all of the parties hereto. No
waiver of any provisions of this Agreement shall be valid unless in
writing and signed by the waiving party. No waiver of any of the
provisions of this Agreement shall be deemed, or shall constitute, a
waiver of any other provision, whether or not similar, nor shall any
waiver constitute a continuing waiver, unless so provided in the
waiver.
(e) If any provisions of this Agreement (or portions thereof) shall, for
any reason, be considered invalid or unenforceable by any court of
competent jurisdiction and such provision is not subject to revision
pursuant to Section 11, such provisions (or portions thereof) shall be
ineffective only to the extent of such invalidity or unenforceability,
and the remaining provisions of this Agreement (or portions thereof)
shall nevertheless be valid, enforceable and of full force and effect.
The Company's rights under this Agreement shall not be exclusive and
shall be in addition to all other rights and remedies available at law
or in equity, including but not limited to statutory rights provided
pursuant to legislation involving the protection of trade secrets.
(f) The section or paragraph headings or titles herein are for convenience
of reference only and shall not be deemed a part of this Agreement.
(g) This Agreement may be executed in multiple counterparts, each of which
shall be deemed to be an original and all of which when taken together
shall constitute a single instrument.
(h) This Agreement shall be governed and controlled as to validity,
enforcement, interpretation, construction, effect and in all other
respects by the laws of the State of Connecticut applicable to
contracts made in that State (other than any conflict of laws rule
which might result in the application of the laws of any other
jurisdiction). Employee hereby expressly submits and consents in
advance to the jurisdiction of the federal and state courts of the
State of Connecticut for all purposes in connection with any action or
proceeding arising out of or relating to this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
PEOPLE'S CHOICE TV CORP.
By:
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Signature
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Name and Title
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Signature
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