OUTDOOR CHANNEL HOLDINGS, INC. DOUGLAS J. LANGSTON EMPLOYMENT AGREEMENT
Exhibit 99.2
OUTDOOR CHANNEL HOLDINGS, INC.
XXXXXXX X. XXXXXXXX EMPLOYMENT AGREEMENT
This
Employment Agreement (this “Agreement”) is entered into as of June 28, 2010 by and
between Outdoor Channel Holdings, Inc. (the “Company”) and Xxxxxxx X. Xxxxxxxx (the “Executive”).
1. Duties and Scope of Employment.
(a)
Positions and Duties. As of June 28, 2010 (the “Effective Date”), Executive will
continue to serve as Chief Accounting Officer. Executive will continue to report to the Company’s
Chief Financial Officer (the “CFO”). As of the Effective Date, Executive will continue to render
such business and professional services in the performance of his duties, consistent with
Executive’s position within the Company, as will reasonably be assigned to him by the CFO. The
period Executive is employed by the Company under this Agreement is referred to herein as the
“Employment Term.”
(b) Obligations. During the Employment Term, Executive will devote substantially all
of Executive’s business efforts and time to the Company and will use good faith efforts to
discharge Executive’s obligations under this Agreement to the best of Executive’s ability and in
accordance with each of the Company’s corporate guidance and ethics guidelines, conflict of
interests policies and code of conduct. For the duration of the Employment Term, Executive agrees
not to actively engage in any other employment, occupation, or consulting activity for any direct
or indirect remuneration without the prior approval of the CFO (which approval will not be
unreasonably withheld); provided, however, that Executive may, without the approval of the CFO,
serve in any capacity with any civic, educational, or charitable organization, provided such
services do not interfere with Executive’s obligations to Company. Executive will be permitted,
without constituting a violation of this Section 1(b) to, (i) continue to provide services to,
serve on the boards of directors of, and maintain or increase his ownership interests in the
entities listed on Exhibit A, and (ii) manage his personal investments, so long as such
activities do not materially interfere with his responsibilities under this Agreement. Executive
hereby represents and warrants to the Company that Executive is not party to any contract,
understanding, agreement or policy, written or otherwise, that would be breached by Executive’s
entering into, or performing services under, this Agreement. Executive further represents that he
has disclosed to the Company in writing all threatened, pending, or actual claims that are
unresolved and still outstanding as of the Effective Date, in each case, against Executive of which
he is aware, if any, as a result of his employment with his current employer (or any other previous
employer) or his membership on any boards of directors.
(c) Other Entities. If appointed by the Company, and as agreed to by Executive,
Executive agrees to serve, without additional compensation, as an officer and director for each of
the Company’s subsidiaries, partnerships, joint ventures, limited liability companies and other
affiliates, including entities in which the Company has a significant investment as determined by
the
Company. As used in this Agreement, the term “affiliates” will include any entity controlled
by, controlling, or under common control of the Company.
(d) Office Location. Executive shall perform his duties under this Agreement, subject
to reasonable business circumstances that require travel outside of such location in connection
with performing his duties under this Agreement, in the Company’s Temecula headquarters.
2. At-Will Employment. Executive and the Company agree that Executive’s employment
with the Company constitutes “at-will” employment. Executive and the Company acknowledge that this
employment relationship may be terminated at any time, upon written notice to the other party, with
or without good cause or for any or no cause, at the option either of the Company or Executive.
However, as described in this Agreement, Executive may be entitled to severance benefits depending
upon the circumstances of Executive’s termination of employment.
3. Term of Agreement. This Agreement will have an initial term commencing on the
Effective Date and ending on December 31, 2012 (the “Initial Term”). On December 31, 2012 and on
each anniversary thereafter, this Agreement automatically will renew for an additional one (1) year
term (each, an “Additional Term”) unless either party provides the other party with written notice
of non-renewal at least sixty (60) days prior to the date of automatic renewal.
4. Compensation.
(a) Base Salary. The Company will pay Executive an annual salary of $204,000 as
compensation for his services (such annual salary, as is then effective, to be referred to herein
as “Base Salary”). The Base Salary will be paid periodically in accordance with the Company’s
normal payroll practices and be subject to the usual, required withholdings. For each calendar
year beginning in 2011, if the average percentage change reflected in the Consumer Price Index for
the preceding year is positive, Executive’s Base Salary for such calendar year will be increased by
the average percentage change reflected in the Consumer Price Index for the preceding year up to a
maximum of five percent (5%). The Base Salary increase, if any, will be approved at the first
meeting of the Compensation Committee of the Board of Directors (the “Committee”) for such calendar
year and shall be effective as of January 1 of such calendar year. By way of example, if the
average percentage change from 2009 to 2010 reflected in the Consumer Price Index from the
beginning of January 2010 through the end of December 2010 is 4%, Executive’s Base Salary for 2011
will be increased by 4% effective as of January 1, 2011.
(b) Annual Incentive. For each of the Company’s fiscal years beginning in 2010,
Executive will be eligible to receive annual cash incentives payable for the achievement of
performance goals established by the CFO, after consultation and discussion with the Committee.
During the Employment Term, Executive’s target annual incentive will be not less than forty percent
(40%) of Base Salary (“Target Annual Incentive”). The actual earned annual cash incentive, if any,
payable to Executive for any performance period will depend upon the extent to which the applicable
performance goal(s) are achieved or exceeded and will be adjusted for under- or over-performance.
(c) Restricted Stock. As of the Effective Date, Executive holds 68,873 shares of
restricted stock of the Company (the “Restricted Stock”). The Restricted Stock will be subject to
the Company’s standard terms and conditions for restricted share grants under the Plan and to the
specific terms and conditions in such awards.
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5. Employee Benefits.
(a) Generally. Executive will be eligible to participate in accordance with the terms
of all Company employee benefit plans, policies and arrangements that are applicable to other
executive officers of the Company, as such plans, policies and arrangements may exist from time to
time.
(b) Vacation. Executive will be entitled to receive paid annual vacation in
accordance with Company policy for other senior executive officers.
6. Expenses. The Company will reimburse Executive for reasonable travel,
entertainment and other expenses incurred by Executive in the furtherance of the performance of
Executive’s duties hereunder, in accordance with the Company’s expense reimbursement policy as in
effect from time to time.
7. Change in Control. Upon a Change in Control, all of Executive’s then outstanding
awards relating to the Company’s common stock (whether stock options, stock appreciation rights,
shares of restricted stock, restricted stock units, or otherwise) will vest in accordance with the
terms and conditions specified in such awards.
8. Termination of Employment. In the event Executive’s employment with the Company
terminates for any reason, Executive will be entitled to any (a) unpaid Base Salary accrued up to
the effective date of termination; (b) unpaid, but earned and accrued annual incentive for any
completed fiscal year as of his termination of employment (including specifically with respect to
such unpaid, but earned annual incentive for the calendar year ending on the expiration of the
Term); (c) pay for accrued but unused vacation; (d) benefits or compensation as provided under the
terms of any employee benefit and compensation agreements or plans applicable to Executive
(e) unreimbursed business expenses required to be reimbursed to Executive, and (f) rights to
indemnification Executive may have under the Company’s Articles of Incorporation, Bylaws, this
Agreement, or separate indemnification agreement, as applicable. In addition, if the termination
is by the Company without Cause or Executive resigns for Good Reason, Executive will be entitled to
the amounts and benefits specified in Section 9.
9. Severance.
(a) Termination Without Cause or Resignation for Good Reason other than in Connection with
a Change in Control. If Executive’s employment is terminated by the Company without Cause or
if Executive resigns for Good Reason other than in Connection with a Change in Control, then,
subject to Section 10 and the requirement to delay certain payments in Section 26, and in addition
to the amounts provided in Section 8, Executive will receive the following severance benefits from
the Company:
(i) Severance Payment. For a period of nine (9) months following the date of such
termination, Executive will receive equal, monthly installments of $17,000 (less applicable
withholding taxes), resulting in an aggregate severance payment of $153,000 (less applicable
withholding taxes).
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(ii) Benefits. The Company agrees to reimburse Executive for the same level of health
coverage and benefits as in effect for Executive immediately prior to Executive’s termination;
provided, however, that (1) Executive constitutes a qualified beneficiary, as defined in Section
4980(B)(g)(1) of the Internal Revenue Code of 1986, as amended (the “Code”); and (2) Executive
elects continuation coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended (“COBRA”), within the time period prescribed pursuant to COBRA. The Company will
continue to reimburse Executive for continuation coverage through the earlier of (A) nine (9)
months following the date of Executive’s termination, or (B) the date upon which Executive and
Executive’s eligible dependents become covered under similar plans. Executive will thereafter be
responsible for the payment of COBRA premiums (including, without limitation, all administrative
expenses) for the remaining COBRA period.
(b) Termination Without Cause or Resignation for Good Reason in Connection with a Change
in Control. If Executive’s employment is terminated by the Company without Cause or if
Executive resigns for Good Reason in Connection with a Change in Control, then, subject to
Section 10 and the requirement to delay certain payments in Section 26, and in addition to the
amounts provided in Section 8, Executive will receive the following severance benefits from the
Company:
(i) Severance Payment. For a period of twelve (12) months following the date of such
termination, Executive will receive equal, monthly installments of $27,083.33 (less applicable
withholding taxes), resulting in an aggregate severance payment of $325,000 (less applicable
withholding taxes).
(ii) Benefits. The Company agrees to reimburse Executive for the same level of health
coverage and benefits as in effect for Executive immediately prior to Executive’s termination;
provided, however, that (1) Executive constitutes a qualified beneficiary, as defined in Section
4980(B)(g)(1) of the Internal Revenue Code of 1986, as amended (the “Code”); and (2) Executive
elects continuation coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended (“COBRA”), within the time period prescribed pursuant to COBRA. The Company will
continue to reimburse Executive for continuation coverage through the earlier of (A) twelve (12)
months following the date of Executive’s termination, or (B) the date upon which Executive and
Executive’s eligible dependents become covered under similar plans. Executive will thereafter be
responsible for the payment of COBRA premiums (including, without limitation, all administrative
expenses) for the remaining COBRA period.
(c) Termination upon Death or Disability. If Executive’s employment is terminated on
account of the Executive’s death or Disability, Executive shall receive, in addition to the
payments required by Section 8, a portion of his Target Annual Incentive pro-rated from the
beginning of the applicable fiscal year in which such termination occurs through the date of
termination, and disregarding for this purpose the requirement to satisfy any performance
objectives,
(the “Pro-Rata Bonus”) and such other payments and benefits in accordance with the Company’s
standard plans, programs and practices (if any).
(d) Voluntary Termination Without Good Reason or Termination for Cause. If
Executive’s employment is terminated voluntarily, without Good Reason or is terminated for Cause by
the Company, then, except as provided in Section 8, (i) all further vesting of Executive’s
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outstanding Restricted Stock and any other equity awards granted by the Company to Executive will
terminate immediately; (ii) all payments of compensation by the Company to Executive hereunder will
terminate immediately, and (iii) Executive will be eligible for severance benefits only in
accordance with the Company’s then established plans and/or policies (if any).
10. Conditions to Receipt of Severance; Nondisparagement; No Duty to Mitigate.
(a) Release of Claims Agreement. The receipt of any severance or other benefits
pursuant to Section 9 will be subject to Executive signing and not revoking a release of claims
agreement in substantially the form attached as Exhibit B, but with any appropriate
reasonable modifications, reflecting changes in applicable law, as is necessary to provide the
Company with the protection it would have if the release of claims were executed as of the
Effective Date. No severance or other benefits will be paid or provided until the release of
claims agreement becomes effective. Executive shall have up to twenty-one (21) days following
Executive’s termination of employment to consider and deliver such executed separation and release
of claims agreement to the Company. The Company agrees that it will execute and deliver to
Executive said separation and release of claims agreement no later than eight (8) days after it
receives a copy of such agreement executed by Executive. Company agrees that it will be bound by
such separation and release of claims agreement and that same will become effective from and after
the effective date thereof, even if Company fails or refuses to execute and deliver same to
Executive. The receipt of any severance pursuant to Section 9 will also be subject to, during the
Employment Term and the Continuance Period, Executive complying with the non-solicitation and
non-competition requirements of Section 10(b).
(b) Non-solicitation and Non-competition. The receipt of any severance or other
benefits pursuant to Section 9 will be subject to Executive agreeing that during the Employment
Term and Continuance Period, Executive will not (i) solicit any employee of the Company (other than
Executive’s personal assistant) for employment other than at the Company, or (ii) directly or
indirectly engage in, have any ownership interest in or participate in any entity that as of the
date of termination, competes with the Company with respect to Outdoor Programming. Executive’s
passive ownership of not more than 1% of any publicly traded company and/or 5% ownership of any
privately held company will not constitute a breach of this Section 10(b). In addition,
Executive’s ownership and involvement with the entities referenced on Exhibit A will also
not constitute a breach of this Section 10(b).
(c) Nondisparagement. During the Employment Term and Continuance Period, Executive
will not knowingly and materially disparage, criticize, or otherwise make any derogatory statements
regarding the Company. During the Employment Term and Continuance Period, the Company will not
knowingly and materially disparage, criticize, or otherwise make any derogatory statements
regarding Executive. Notwithstanding the foregoing, nothing contained in this Agreement will be
deemed to restrict Executive, the Company or any of the Company’s current or
former officers and/or directors from (1) providing information to any governmental or
regulatory agency (or in any way limit the content of any such information) to the extent they are
requested or required to provide such information pursuant to applicable law or regulation or (2)
enforcing his or its rights pursuant to this Agreement.
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(d) Other Requirements. Executive’s receipt of any payments or benefits under Section
9 will be subject to Executive continuing to comply with the terms of the Confidential Information
Agreement and the provisions of this Section 10.
(e) No Duty to Mitigate. Executive will not be required to mitigate the amount of any
payment contemplated by this Agreement, nor will any earnings that Executive may receive from any
other source reduce any such payment.
11. Excise Tax.
(a) In the event that the severance and other benefits provided in this Agreement or otherwise
payable to Executive constitute “parachute payments” under Section 280G of the Internal Revenue
Code of 1986, as amended (the “Code”) and would be subject to the excise tax imposed by Section
4999 of the Code, then, except as provided by Section 11(b) below: Executive’s benefits shall be
either (i) delivered in full, or (ii) delivered as to such lesser extent which would result in no
portion of such benefits being subject to the excise tax, whichever of the foregoing amounts
results in the receipt by Executive on an after-tax basis, of the greatest amount of benefits. Any
reduction in payments and/or benefits required by this Section shall occur in the following order:
(1) reduction of cash payments; (2) reduction of vesting acceleration of equity awards; and (3)
reduction of other benefits paid or provided to Executive. In the event that acceleration of
vesting of equity awards is to be reduced, such acceleration of vesting shall be cancelled in the
reverse order of the date of grant for the Executive’s equity awards. If two or more equity awards
are granted on the same day, the equity awards will be reduced on a pro-rata basis.
(b) Unless Executive and the Company agree otherwise in writing, the determination of
Executive’s excise tax liability will be made in writing by the independent auditors who are
primarily used by the Company immediately prior to the Change in Control (the “Accountants”). For
purposes of making the calculations required by this Section 11, the Accountants may make
reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable,
good faith interpretations concerning the application of Sections 280G and 4999 of the Code.
Executive and the Company agree to furnish such information and documents as the Accountants may
reasonably request in order to make a determination under this Section 11. The Company will bear
all costs the Accountants and/or Executive may reasonably incur in connection with any calculations
contemplated by this Section 11.
12. Definitions.
(a) Cause. For purposes of this Agreement, “Cause” will mean:
(i) Executive’s willful and continued failure to perform the duties and responsibilities of
his position (other than as a result of Executive’s illness or injury) after there has been
delivered to Executive a written demand for performance from the CEO which describes the
basis for the CEO’s belief that Executive has not substantially performed his duties and
provides Executive with thirty (30) days to take corrective action;
(ii) Any material act of personal dishonesty taken by Executive in connection with his
responsibilities as an employee of the Company with the intention that such action may result in
the substantial personal enrichment of Executive;
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(iii) Executive’s conviction of, or plea of nolo contendere to, a felony that the Company’s
Board of Directors reasonably believes has had or will have a material detrimental effect on the
Company’s reputation or business;
(iv) A willful breach of any fiduciary duty owed to the Company by Executive that has a
material detrimental effect on the Company’s reputation or business;
(v) Executive being found liable in any Securities and Exchange Commission or other civil or
criminal securities law action (regardless of whether or not Executive admits or denies liability),
which the Company’s Board of Directors determines, in its reasonable discretion, will have a
material detrimental effect on the Company’s reputation or business;
(vi) Executive entering any cease and desist order with respect to any action which would bar
Executive from service as an executive officer or member of a board of directors of any
publicly-traded company (regardless of whether or not Executive admits or denies liability);
(vii) Executive (A) obstructing or impeding; (B) endeavoring to obstruct or impede, or (C)
failing to materially cooperate with, any investigation authorized by the Company’s Board of
Directors or any governmental or self-regulatory entity (an “Investigation”). However, Executive’s
failure to waive attorney-client privilege relating to communications with Executive’s own attorney
in connection with an Investigation will not constitute “Cause”; or
(viii) Executive’s disqualification or bar by any governmental or self-regulatory authority
from serving in the capacity contemplated by this Agreement, if (A) the disqualification or bar
continues for more than thirty (30) days, and (B) during that period the Company uses its
commercially reasonable efforts to cause the disqualification or bar to be lifted. While any
disqualification or bar continues during Executive’s employment, Executive will serve in the
capacity contemplated by this Agreement to whatever extent legally permissible and, if Executive’s
employment is not permissible, Executive will be placed on administrative leave (which will be paid
to the extent legally permissible).
Other than for a termination pursuant to Section 12(a)(iii), Executive shall receive notice and an
opportunity to be heard before the Company’s Board of Directors with Executive’s own attorney
before any termination for Cause is deemed effective. Notwithstanding anything to the contrary,
the CEO or the Company’s Board of Directors may immediately place Executive on administrative leave
(with full pay and benefits to the extent legally permissible) and suspend all access to Company
information, employees and business should Executive wish to avail himself of his opportunity to be
heard before the Company’s Board of Directors prior to a termination for Cause. If Executive
avails himself of his opportunity to be heard before the Company’s Board of Directors, and then
fails to make himself available to the Company’s Board of Directors within five (5)
business days of such request to be heard, the Company’s Board of Directors may thereafter cancel
the administrative leave and terminate Executive for Cause.
(b) Change in Control. For purposes of this Agreement, “Change in Control” will have
the same meaning as “Change in Control” is defined in the Plan.
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(c) Consumer Price Index. For purposes of this Agreement, “Consumer Price Index” will
mean the All Items Consumer Price Index for All Urban Consumers (CPI-U) published by the Bureau of
Labor Statistics of the United States Department of Labor reflecting the U.S. City Average, 1982-84
= 100.
(d) Continuance Period. For purposes of this Agreement:
(i) if Executive’s employment is terminated by the Company without Cause or if Executive
resigns for Good Reason, then “Continuance Period” will mean the period of time beginning on the
date of the termination of Executive’s employment and ending on the date that the Severance Period
ends.
(ii) in the event of either (i) the expiration, and non-renewal of the Initial Term or any
Additional Term, or (ii) a termination of the Executive’s employment for any other reason, the
“Continuance Period,” if any, will mean either the one (1) year or two (2) year period elected by
the Company and for which the Company agrees to pay Executive, subject to the requirement to delay
certain payments in Section 26, continued Base Salary and Target Annual Incentive for the
appropriate period. The Company may elect to not impose any such Continuance Period in its sole
discretion, but if it does wish to impose a Continuance Period, it must make the one (1) year or
two (2) year election, as applicable, within ten (10) business days (i) following the election of
the Company or Executive to not renew the Employment Term or (ii) following the Executive’s
termination of employment.
(e) Disability. For purposes of this Agreement, “Disability” shall have the same
meaning as that term is defined in the Plan. Notwithstanding the foregoing however, should the
Company maintain a long-term disability plan at any time during the Employment Term, a
determination of disability under such plan shall also be considered a “Disability” for purposes of
this Agreement.
(f) Good Reason. For purposes of this Agreement, “Good Reason” means the occurrence
of any of the following, without Executive’s express written consent:
(i) A material reduction of Executive’s responsibilities, relative to Executive’s
responsibilities in effect immediately prior to such reduction; including a reduction in
responsibilities by virtue of the Company being acquired and made part of another entity (as, for
example, when the Chief Executive Officer of the Company remains as the senior executive officer of
a division or subsidiary of the acquiror which division or subsidiary either contains substantially
all of the Company’s business or is of a comparable size), or a change in the Executive’s reporting
position such that Executive no longer reports directly to the CEO of a publicly-traded company
(unless Executive is reporting to the Chief Executive Officer of the parent corporation in a group
of controlled corporations, none of which is a publicly-traded company);
(ii) A material reduction in Executive’s Base Salary or Target Annual Incentive as in effect
immediately prior to such reduction other than pursuant to a reduction that also is applied to
substantially all other executive officers of the Company and which reduction reduces the Base
Salary and/or Target Annual Incentive by a percentage reduction that is no greater than 10%;
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(iii) The relocation of Executive to a facility or location more than fifty (50) miles from
his primary place of employment;
(iv) Any purported termination of the Executive’s employment for “Cause” without first
satisfying the procedural protections, as applicable, required by the definition of “Cause” in this
Agreement; or
(v) The failure of the Company to obtain the assumption of this Agreement by a successor
and/or acquiror and an agreement that Executive will retain the substantially similar
responsibilities (to the extent described in Section 1) in the acquiror or the merged or surviving
company as he had prior to the transaction.
The notification and placement of Executive on administrative leave pending a potential
determination by the Company’s Board of Directors that Executive may be terminated for Cause shall
not constitute Good Reason for purposes of this Agreement. Executive will not resign for Good
Reason without first providing the Company with written notice of the acts or omissions
constituting the grounds for “Good Reason” within ninety (90) days of the initial existence of the
grounds for “Good Reason” and, if such grounds are susceptible to cure, a reasonable cure period of
not less than thirty (30) days following the date of such notice. Any resignation for Good Reason
must occur within two years of the initial existence of the grounds constituting Good Reason.
(g) In Connection with a Change in Control. A termination of Executive’s employment
with the Company is “in Connection with a Change in Control” if Executive’s employment is
terminated during that period either three (3) months prior to or within twelve (12) months
following a Change in Control, as applicable.
(h) Outdoor Programming. For purposes of this Agreement, “Outdoor Programming” means
any television, internet or other media programming devoted primarily to traditional outdoor
activities, such as hunting, fishing, shooting sports, rodeo, gold prospecting and related
life-style programming.
(g) Plan. For purposes of this Agreement, the “Plan” means the Company’s 2004
Long-Term Incentive Plan, as amended.
13. Indemnification and D&O Insurance. Subject to applicable law, Executive will be
provided indemnification to the maximum extent permitted by the Company’s Articles of Incorporation
or Bylaws, including, if applicable, any directors and officers insurance policies, with such
indemnification to be on terms determined by the Company’s Board of Directors or any of its
committees, but on terms no less favorable than provided to any other Company executive officer or
director and subject to the terms of any separate written indemnification agreement. The Company
shall also maintain commercially reasonable D&O insurance covering Executive during the
Employment Term in such amount and pursuant to such terms as is typical and customary for
companies of similar size and nature as the Company.
14. Confidential Information. Executive agrees to execute the Company’s confidential
information and intellectual property agreement, in a form reasonably satisfactory to Executive
(the “Confidential Information Agreement”).
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15. Assignment. This Agreement will be binding upon and inure to the benefit of
(a) the heirs, executors and legal representatives of Executive upon Executive’s death, and (b) any
successor of the Company. Any such successor of the Company will be deemed substituted for the
Company under the terms of this Agreement for all purposes. For this purpose, “successor” means
any person, firm, corporation, or other business entity which at any time, whether by purchase,
merger, or otherwise, directly or indirectly acquires all or substantially all of the assets or
business of the Company. None of the rights of Executive to receive any form of compensation
payable pursuant to this Agreement may be assigned or transferred except by will or the laws of
descent and distribution. Any other attempted assignment, transfer, conveyance, or other
disposition of Executive’s right to compensation or other benefits will be null and void.
16. Notices. All notices, requests, demands and other communications called for
hereunder will be in writing and will be deemed given (a) on the date of delivery if delivered
personally; (b) one (1) day after being sent overnight by a well-established commercial overnight
service, or (c) four (4) days after being mailed by registered or certified mail, return receipt
requested, prepaid and addressed to the parties or their successors at the following addresses, or
at such other addresses as the parties may later designate in writing:
If to the Company:
Attn: CFO
with a copy to: its General Counsel
Outdoor Channel Holdings, Inc.
00000 Xxxxxxxx Xxxx Xxxxx
Xxxxxxxx, XX 00000
with a copy to: its General Counsel
Outdoor Channel Holdings, Inc.
00000 Xxxxxxxx Xxxx Xxxxx
Xxxxxxxx, XX 00000
If to Executive:
at the last residential address known by the Company,
with a copy to:
with a copy to:
17. Severability. In the event that any provision or any portion of any provision
hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable, or
void, this Agreement will continue in full force and effect without said provision or portion of
provision. The remainder of this Agreement shall be interpreted so as best to effect the intent of
the Company and Executive.
18. Arbitration. The Parties agree that any and all disputes arising out of the terms
of this Agreement, Executive’s employment by the Company, Executive’s service as an officer or
director of the Company, or Executive’s compensation and benefits, their interpretation and any of
the matters herein released, will be subject to binding arbitration. In the event of a dispute,
the parties (or their legal representatives) will promptly confer to select a Single Arbitrator
mutually acceptable to both parties. If the parties cannot agree on an Arbitrator, then the moving
party may file a Demand for Arbitration with the American Arbitration Association (“AAA”) in
California, who will
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be selected and appointed consistent with the AAA-Employment Dispute
Resolution Rules, except that such Arbitrator must have the qualifications set forth in this
paragraph. Any arbitration will be conducted in a manner consistent with AAA National Rules for
the Resolution of Employment Disputes, supplemented by the California Rules of Civil Procedure.
The Parties further agree that the prevailing party in any arbitration will be entitled to
injunctive relief in any court of competent jurisdiction to enforce the arbitration award. The
Parties hereby agree to waive their right to have any dispute between them resolved in a court of
law by a judge or jury. This paragraph will not prevent either party from seeking injunctive
relief (or any other provisional remedy) from any court having jurisdiction over the Parties and
the subject matter of their dispute relating to Executive’s obligations under this Agreement and
the Confidential Information Agreement.
19. Integration. This Agreement, together with the Confidential Information Agreement
and the standard forms of equity award grant that describe Executive’s equity awards, represents
the entire agreement and understanding between the parties as to the subject matter herein and
supersedes all prior or contemporaneous agreements whether written or oral. The Executive agrees
and acknowledges that this Agreement supersedes and replaces, in its entirety, the Change of
Control Severance Agreement entered into between the Company and Executive dated as of March 10,
2009, and that Executive shall not be eligible for any benefits or compensation under such Change
of Control Severance Agreement. No waiver, alteration, or modification of any of the provisions of
this Agreement will be binding unless in a writing and signed by duly authorized representatives of
the parties hereto. In entering into this Agreement, no party has relied on or made any
representation, warranty, inducement, promise, or understanding that is not in this Agreement. To
the extent that any provisions of this Agreement conflict with those of any other agreement to be
signed upon Executive’s hire, the terms in this Agreement will prevail.
20. Waiver of Breach. The waiver of a breach of any term or provision of this
Agreement, which must be in writing, will not operate as or be construed to be a waiver of any
other previous or subsequent breach of this Agreement.
21. Survival. The Confidential Information Agreement and the Company’s and
Executive’s responsibilities under Sections 9, 10, 11, 13 and 18 will survive the termination of
this Agreement.
22. Headings. All captions and Section headings used in this Agreement are for
convenient reference only and do not form a part of this Agreement.
23. Tax Withholding. All payments made pursuant to this Agreement will be subject to
withholding of applicable taxes.
24. Governing Law. This Agreement will be governed by the laws of the state of
California without regard for choice of law provisions of any state or other jurisdiction.
25. Acknowledgment. Executive acknowledges that he has had the opportunity to discuss
this matter with and obtain advice from his private attorney, has had sufficient time to, and has
carefully read and fully understands all the provisions of this Agreement, and is knowingly and
voluntarily entering into this Agreement.
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26. Code Section 409A.
(a) Notwithstanding anything to the contrary in this Agreement, no Deferred Compensation
Separation Benefits (as defined below) or other severance benefits that are exempt from Section
409A (as defined below) pursuant to Treasury Regulation Section 1.409A-1(b)(9) will become payable
under this Agreement until Executive has a “separation from service” within the meaning of Section
409A of the Code, and any proposed or final regulations and guidance promulgated thereunder
(“Section 409A”). Further, if Executive is a “specified employee” within the meaning of Section
409A at the time of Executive’s separation from service (other than due to death), and the
severance payable to Executive, if any, pursuant to this Agreement, when considered together with
any other severance payments or separation benefits, are considered deferred compensation under
Section 409A (together, the “Deferred Compensation Separation Benefits”), such Deferred
Compensation Separation Payments that are otherwise payable within the first six (6) months
following Executive’s separation from service will become payable on the first payroll date that
occurs on or after the date six (6) months and one (1) day following the date of Executive’s
separation from service. All subsequent Deferred Compensation Separation Benefits, if any, will be
payable in accordance with the payment schedule applicable to each payment or benefit.
Notwithstanding anything herein to the contrary, if Executive dies following his termination but
prior to the six (6) month anniversary of his separation from service, then any payments delayed in
accordance with this paragraph will be payable in a lump sum as soon as administratively
practicable after the date of Executive’s death and all other Deferred Compensation Separation
Benefits will be payable in accordance with the payment schedule applicable to each payment or
benefit. Each payment and benefit payable under this Agreement is intended to constitute separate
payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.
(b) Any amount paid under this Agreement that satisfies the requirements of the “short-term
deferral” rule set forth in Section 1.409A-1(b)(4) of the Treasury Regulations shall not constitute
Deferred Compensation Separation Benefits for purposes of Section 26(a) above. Any severance
payment that entitles Executive to taxable reimbursements or taxable in-kind benefits covered by
Section 1.409A-1(b)(8)(v) shall not constitute a Deferred Compensation Separation Benefit.
(c) Any amount paid under this Agreement that qualifies as a payment made as a result of an
involuntary separation from service pursuant to Section 1.409A-1(b)(9)(iii) of the Treasury
Regulations that does not exceed the Section 409A Limit (as defined below) shall not constitute
Deferred Compensation Separation Benefits for purposes of Section 26(a) above. For purposes of
this Section 26(c), “Section 409A Limit” will mean the lesser of two (2) times: (i) Executive’s
annualized compensation based upon the annual rate of pay paid to Executive during his taxable year
preceding Executive’s taxable year of Executive’s separation from service as
determined under Treasury Regulation 1.409A-1(b)(9)(iii)(A)(1); or (ii) the maximum amount
that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code
for the year in which Executive’s employment is terminated.
(d) The foregoing provisions are intended to comply with the requirements of Section 409A so
that none of the severance payments and benefits to be provided hereunder will be subject to the
additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so
comply. The Company and Executive agree to work together in good faith to consider amendments to
this Agreement and to take such reasonable actions which are necessary,
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appropriate or desirable to
avoid imposition of any additional tax or income recognition prior to actual payment to Executive
under Section 409A.
27. Counterparts. This Agreement may be executed in counterparts, and each
counterpart will have the same force and effect as an original and will constitute an effective,
binding agreement on the part of each of the undersigned.
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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the
Company by a duly authorized officer, as of the day and year written below.
COMPANY: |
||||
OUTDOOR CHANNEL HOLDINGS, INC. |
||||
/s/ Xxxxxx X. Xxxxxxx
|
Date: June 28, 2010 | |||
Its: Chief Operating Officer |
||||
EXECUTIVE: |
||||
/s/ Xxxxxxx X. Xxxxxxxx
|
Date: June 28, 2010 |
[SIGNATURE PAGE TO XXXXXXX X. XXXXXXXX EMPLOYMENT AGREEMENT]
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Exhibit A
| Entity | Limitations | |
One publicly traded corporation
|
Executive may serve as a member of such corporation’s board of directors, provided that the business of such entity does not compete with the Company and Executive’s ownership in such entity is limited to a maximum of 2%. Executive may serve on committees of such corporations’ board of directors, but not as chairman of any such committees. |
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Exhibit B
Release of Claims Agreement
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