Exhibit 10.1
AMENDED AND RESTATED EMPLOYMENT
AGREEMENT
AMENDED AND RESTATED EMPLOYMENT
AGREEMENT dated as of November 20, 2008 (the “Effective
Date”), between News America Incorporated, a Delaware
corporation (the “Company”), and Roger Ailes (the
“Executive”).
W I T N E S S E T H:
WHEREAS, the Executive is currently
employed by the Company pursuant to the terms of an employment
agreement between the Company and the Executive dated as of
February 21, 2007 (the “Prior
Agreement”);
WHEREAS, the Company desires to
continue such employment relationship and enter into this
Agreement, which will supersede the Prior Agreement and set forth
the terms and conditions under which the Executive will continue to
serve the Company, its parent, News Corporation, and its
affiliates;
WHEREAS, the Executive wishes to
continue his employment with the Company on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of
the premises and mutual agreements hereinafter contained, the
parties hereto agree as follows:
1. Duties . The Company
agrees to employ the Executive as Chairman and Chief Executive
Officer of Fox News Channel (the “News Channel”) and
Fox Business Channel (the “Business Channel”), as
Chairman of Fox Television Stations (“FTS”) and
Twentieth Television (“TT”), and as Editor-in-Chief of
Fox News.com, and the Executive agrees to accept such employment
for the Term of Employment as hereinafter defined. During the Term
of Employment, the Executive, subject to the provisions of this
Agreement, shall have the title and the duties of Chairman and
Chief Executive Officer of the News Channel and the Business
Channel, Chairman of FTS and TT, and Editor-in-Chief of Fox
News.com.
In performing his duties hereunder,
the Executive shall report directly to the Chairman and Chief
Executive Officer and President and Chief Operating Officer of News
Corporation. In conformity with budgets approved by the Chief
Executive Officer of News Corporation, the Executive shall have the
authority and perform such duties for (i) the News Channel and
Business Channel as shall be consistent with the authority and
duties of a chairman and chief executive officer including the
right to hire and fire employees (including an executive assistant)
and (ii) FTS and TT as shall be consistent with the authority
and duties of a chairman. Executive’s duties will include
direction of affiliate sales and advertising sales (subject to
coordinating such activities with similar activities conducted by
other Fox Television entities) and content and format of the News
Channel and Business Channel and Fox News.com. In connection with
performing his duties under this Agreement, the Executive shall be
a Senior Advisor to the Chairman and Chief Executive Officer and
President and Chief Operating Officer of News Corporation on
television and all broadcast, cable news, business news and
internet matters. During the Term of Employment, subject to the
provisions of Section 6(d) hereof, the Executive shall devote
all of his business time and attention and give his best efforts
and skill to furthering the business and interests of the Company.
If requested, Executive agrees to serve without additional
compensation as a director and/or committee member of the News
Channel, the Business Channel, FTS, TT and any other subsidiaries
and affiliates of News Corporation.
In his capacities under this
Agreement, including as a director, Executive shall be indemnified,
defended and held harmless for any and all claims as against the
Company and Executive and will be insured under News
Corporation’s Directors and Officers Liability Insurance
Policy. This insurance and/or indemnification will include the
provision of legal representation and the payment of
damages.
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2. Term . “Term of
Employment” as used herein shall mean the period commencing
on the date hereof and ending on June 30, 2013 , provided,
however, if the Term of Employment is terminated earlier, as
hereinafter set forth, the Term of Employment shall mean the period
from the date hereof through the effective date of such earlier
termination.
3. Compensation .
(a) Base Salary and Minimum
Bonus . As compensation for his services, Executive shall be
paid, and agrees to accept, a base salary (the “Base
Salary”) at an annual rate of $5,000,000, to be paid in the
same manner as other senior executives of the Company are paid. If
the Executive is employed on June 30, 2009, June 30,
2010, June 30, 2011, June 30, 2012 and
June 30, 2013, on each such date the Executive shall be
entitled to a minimum bonus (payable in cash or Common Stock, at
the Company’s discretion) of $1,000,000, $1,000,000,
$1,250,000, $1,250,000 and $1,250,000, respectively (“Minimum
Bonus”), and, other than the “Special” Bonuses
provided under Section 3(b) and (c) hereof, any
additional bonus in excess of the Minimum Bonus shall be in the
sole discretion of the Company. The payments to be made to the
Executive pursuant to this Agreement shall be subject to deductions
as shall be required to be withheld by applicable law and
regulations.
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(b) Special Bonus
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(i)
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Executive shall
be entitled to receive from the Company a special bonus (the
“Special Bonus”) based on the earnings before interest,
taxes, depreciation and amortization of the News Channel, as
determined by the Company consistent with past practice (excluding
the expensing or employee stock options and/or grants) applied in
accordance with the Company’s normal practice and policies
(“EBITDA”) in accordance with the following terms and
conditions:
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(A)
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Special Bonus
Schedule
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Fiscal Year
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High End
Special Bonus
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2009
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$
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5,500,000
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2010
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$
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6,500,000
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2011
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$
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8,000,000
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2012
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$
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9,000,000
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2013
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$
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10,000,000
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For each fiscal year during the Term
of Employment, the Compensation Committee of News Corporation (the
“Compensation Committee”) shall establish a high end
EBITDA for the News Channel (“High End EBITDA”) and a
low end EBITDA for the News Channel (“Low End EBITDA”)
which shall be communicated to the Executive upon determination.
Such determination for any fiscal year during the Term of
Employment shall be made no later than (but may be made at any time
before) the first quarter of the fiscal year for which the goal
applies.
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(B)
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If the EBITDA
of the News Channel for any fiscal year during the Term of
Employment is not less than the High End EBITDA, then Executive
shall be entitled to receive a Special Bonus equal to the High End
Special Bonus for such fiscal year.
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(C)
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If the EBITDA
for fiscal year 2009 during the Term of Employment is equal to or
greater than the Low End EBITDA but less than the High End EBITDA,
then Executive shall be entitled to receive a Special Bonus equal
to $2.8 million plus the product of (1) a fraction, the
numerator of which is the amount by which the EBITDA for such
fiscal year exceeds the Low End EBITDA for such fiscal year and the
denominator of which is the High End EBITDA less the Low End EBITDA
for fiscal year 2009, multiplied by (2) the sum of the High
End Special Bonus minus $2.8 million.
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(D)
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If the EBITDA
for fiscal year 2010 during the Term of Employment is equal to or
greater than the Low End EBITDA but less than the High End EBITDA,
then Executive shall be entitled to receive a Special Bonus equal
to $3.1 million plus the product of (1) a fraction, the
numerator of which is the amount by which the EBITDA for such
fiscal year exceeds the Low End EBITDA for such fiscal year and the
denominator of which is the High End EBITDA less the Low End EBITDA
for fiscal year 2010, multiplied by (2) the sum of the High
End Special Bonus minus $3.1 million.
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(E)
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If the EBITDA for fiscal year
2011 during the Term of Employment is equal to or greater than the
Low End EBITDA but less than the High End EBITDA, then Executive
shall be entitled to receive a Special Bonus equal to $4.5 million
plus the product of (1) a fraction, the numerator of which is
the amount by which the
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EBITDA for such fiscal year
exceeds the Low End EBITDA for such fiscal year and the denominator
of which is the High End EBITDA less the Low End EBITDA for fiscal
year 2011, multiplied by (2) the sum of the High End Special
Bonus minus $4.5 million.
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(F)
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If the EBITDA
for fiscal year 2012 during the Term of Employment is equal to or
greater than the Low End EBITDA but less than the High End EBITDA,
then Executive shall be entitled to receive a Special Bonus equal
to $5.0 million plus the product of (1) a fraction, the
numerator of which is the amount by which the EBITDA for such
fiscal year exceeds the Low End EBITDA for such fiscal year and the
denominator of which is the High End EBITDA less the Low End EBITDA
for fiscal year 2012, multiplied by (2) the sum of the High
End Special Bonus minus $5.0 million.
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(G)
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If the EBITDA
for fiscal year 2013 during the Term of Employment is equal to or
greater than the Low End EBITDA but less than the High End EBITDA,
then Executive shall be entitled to receive a Special Bonus equal
to $5.5 million plus the product of (1) a fraction, the
numerator of which is the amount by which the EBITDA for such
fiscal year exceeds the Low End EBITDA for such fiscal year and the
denominator of which is the High End EBITDA less the Low End EBITDA
for fiscal year 2013, multiplied by (2) the sum of the High
End Special Bonus minus $5.5 million.
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(H)
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If the EBITDA
for any fiscal year during the Term of Employment is not equal to
or greater than the Low End EBITDA, then Executive shall not be
entitled to receive a Special Bonus for such fiscal
year.
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(I)
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The Special
Bonus, if any, shall be payable within twenty days after the
determination of EBITDA for the fiscal year then ended but shall be
paid by the end of the calendar year in which such determination
was made and shall be in addition to, and not in lieu of, or
considered an advance in respect of, any other bonus that Executive
may be entitled to receive pursuant to this Agreement.
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(ii)
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If, during the
Term of the Employment, the News Channel commences or acquires
another business, is involved in a reorganization, or any similar
event occurs which has the effect of changing in a material respect
the EBITDA of the News Channel as calculated under this Agreement,
Executive and the Company will agree to adjustments in the amount
and in the manner in which the EBITDA of the News Channel is
calculated.
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(c) FBN Bonus . The Executive
shall be entitled to receive shares of Common Stock (the
“Bonus Stock”) at such time that each of the following
events occur: (i) 250,000 shares when EBITDA of the Business
Channel is equal to or greater than breakeven, and
(ii) 350,000 shares when EBITDA of the Business Channel is
equal to or greater than $100,000,000.
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4. Other Benefits . The
Executive shall be entitled to the following benefits
(collectively, the “Benefits”):
(a) The Executive shall be entitled
to participate in any equity, profit-sharing, pension (including
any supplemental executive retirement plan (a “SERP”),
group medical, dental, disability and life insurance and other
similar benefit plans, presently in effect or hereafter adopted,
applicable generally to the highest level of senior executives of
the Company and in an individual supplemental retirement plan
(“ISERA”). In addition, for as long as he lives,
whether or not he is employed by the Company, the Executive will be
entitled to participate in, and the Company will pay for, such
group medical, dental, disability and life insurance and other
similar benefit plans, presently in effect or hereafter adopted,
applicable generally to the highest level of senior executives of
the Company; provided that the Company shall not be required to
continue to provide the benefits under this Section 4(a) if
such benefits are provided to Executive by another employer. Upon
his death, the Executive’s surviving spouse and eligible
dependents shall continue to be provided with Company health and
welfare benefits (including, without limitation, medical, dental
and vision benefits) on the same terms and conditions as are
applicable generally to the highest level of senior executives of
the Company.
(b) In order to facilitate the
Executive’s performance of his duties, the Company shall
provide him with the use of an automobile and driver, which driver
shall be selected by Executive. If it is necessary for the
Executive to travel for the performance of his duties he shall be
provided with a private jet to do so by the Company. In the
Company’s discretion upon Executive’s request, the
Executive shall be permitted to use a jet owned by News Corporation
for business travel or a chartered jet selected by and arranged for
by the Executive and approved by the Deputy Chief Financial Officer
of News Corporation. Further, the Company shall provide security
services reasonably selected by Executive for the protection of
Executive and his family.
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(c) Executive shall be entitled to
four weeks vacation during each year of his employment
hereunder.
5. Business Expenses . During
the Term of Employment, the Executive shall be reimbursed for all
expenses reasonably incurred by him in connection with his
performance of his duties hereunder.
6. Confidentiality; Restriction
on Competition; Etc .
(a) The Executive shall not, without
the prior written consent of the Company, divulge, disclose or make
accessible to any other person, firm, partnership, corporation or
other entity any Confidential Information except (a) in the
course of carrying out his duties under this Agreement or
(b) when required to do so by a court of law, by any
governmental agency having supervisory authority over the business
of the Company or by any administrative or legislative body
(including a committee thereof) with apparent jurisdiction to order
him to divulge, disclose or make accessible such information. For
purposes of this Section 6(a), “Confidential
Information” shall mean all information that is not known or
available to the public concerning the business of the Company, the
Fox Television Group, or News Corporation and its subsidiaries
relating to its products, product development, trade secrets,
customers, suppliers, finances, and business plans and strategies.
For this purpose, information known or available generally within
the trade or entertainment industry shall be deemed to be known or
available to the public. Confidential Information shall include
information that is, or becomes, known to the public as a result of
a breach by the Executive of the provisions of this
Section 6(a).
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(b) The relationship between the
parties hereto is exclusively that of employer and employee, and
the obligations of the Company, to the Executive are exclusively
contractual in nature. The Company or such o
