Exhibit 10.7
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT
(“Agreement”) is entered into by and between Eric
Korman (“Employee”) and Ticketmaster L.L.C., a Virginia
limited liability company (the “Company”), as of
April 11 th , 2006 and shall be effective as of
April 10, 2006 (the “Effective Date”).
WHEREAS, the Company desires to
establish its right to the services of Employee, in the capacity
described below, on the terms and conditions hereinafter set forth,
and Employee is willing to accept such employment on such terms and
conditions.
NOW, THEREFORE, in consideration of
the mutual agreements hereinafter set forth, Employee and the
Company have agreed and do hereby agree as follows:
1A.
EMPLOYMENT
. The Company agrees to employ
Employee as Executive Vice President and Employee accepts and
agrees to such employment. During Employee’s employment with
the Company, Employee shall do and perform all services and acts
necessary or advisable to fulfill the duties and responsibilities
as are commensurate and consistent with Employee’s position
and shall render such services on the terms set forth herein.
Employee shall render such other services for the Company and
corporations controlled by, under common control with or
controlling, directly or indirectly, the Company (other than
Expedia, Inc. and its subsidiaries), and to successor entities
and assignees of the Company (each, a “Company
Affiliate”) as the Company may from time to time reasonably
request and as shall be consistent with the duties Employee is to
perform for the Company and with Employee’s position, status
and experience. During Employee’s employment with the
Company, Employee shall report directly to the President and Chief
Operating Officer (hereinafter referred to as the “Reporting
Officer”). Employee shall have such powers and duties with
respect to the Company as may reasonably be assigned to Employee by
the Reporting Officer, to the extent consistent with
Employee’s position and status. Employee agrees to devote all
of Employee’s working time, attention and efforts to the
Company and to perform the duties of Employee’s position in
accordance with the Company’s written policies as in effect
from time to time, which are generally applicable to all senior
executives of the Company. Employee’s principal
place of employment shall be the Company’s offices in West
Hollywood, California.
2A.
TERM OF AGREEMENT
. The term of this Agreement shall
commence on the Effective Date and shall continue for a period of
three (3) years (the “Term”), unless sooner
terminated in accordance with the provisions of Section 1 of
the Standard Terms and Conditions attached hereto (the
“Standard Terms and Conditions”). For the avoidance of
doubt, the parties’ post-termination obligations including
but not limited to the confidentiality, consulting,
non-solicitation of employees, and non-solicitation of clients
provisions in the Agreement shall survive the Term of
Employee’s employment hereunder.
3A.
COMPENSATION
.
(a)
BASE SALARY
. During the Term, the Company shall
pay Employee an annual base salary of $350,000 (the “Base
Salary”), payable in equal biweekly installments or in
accordance with the Company’s payroll practice as in effect
from time to time. For all purposes under this Agreement, the term
“Base Salary” shall refer to Base Salary as in effect
from time to time. Employee’s salary shall be reviewed each
February for an increase (but not a decrease) during the Term
in relation to Employee’s responsibilities; provided ,
however , that the Company shall not be required to increase
Employee’s Base Salary.
(b)
SIGNING BONUS
. Upon execution of this Agreement
and within 10 days after the Effective Date, Company shall pay
Employee a one-time signing bonus in the amount of $150,000. In the
event Employee resigns without Good Reason or is terminated for
Cause during the first year of the Term, Employee shall refund to
the Company a prorated portion of the signing bonus, in the amount
of $12,500.00 multiplied by the number of whole calendar months
from the date of such resignation or termination through the end of
the first year of the Term.
(c)
RESTRICTED STOCK
. In consideration of
Employee’s entering into this Agreement and as an inducement
to join the Company, Employee will receive under IAC’s
Stock & Annual Incentive Plan (the “IAC Incentive
Plan”) an award of restricted stock units (the
“Restricted Stock Units”) representing shares of common
stock of IAC/InterActiveCorp valued at $250,000 subject to the
approval of the Compensation/Benefits Committee of the Board of
Directors of IAC/InterActiveCorp. The award will be governed by a
Restricted Stock Unit agreement. The value of Employee’s
award will be converted into the number of units Employee will
receive based on the average of the closing prices of IAC stock for
the 30 trading days ending on the trading day prior to the
Effective Date, and will be rounded down to the nearest whole unit.
This Restricted Stock Unit grant shall be in addition to, and not
in lieu of, the annual grant which the Executive is eligible to
receive under the IAC Incentive Plan, which annual grant is to be
determined by the Committee (as defined in the IAC Incentive Plan)
of the Board of Directors of IAC as provided under the terms of the
Plan.
(d)
DISCRETIONARY BONUS
. During the Term, Employee shall be
eligible to receive discretionary annual bonuses.
(e)
BENEFITS . From the Effective Date through the date of
termination of Employee’s employment with the Company for any
reason, Employee shall be entitled to participate in any welfare,
health and life insurance and pension benefit and incentive
programs as may be adopted from time to time by the Company for
its
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senior executives. Without limiting
the generality of the foregoing, Employee shall be entitled to the
following benefits:
(i)
Reimbursement for Business
Expenses . During the
Term, the Company shall reimburse Employee for all reasonable and
necessary expenses incurred by Employee in performing
Employee’s duties for the Company, on the same basis as
similarly situated employees and in accordance with the
Company’s policies as in effect from time to time.
(ii)
Vacation . During the Term, Employee shall be entitled to
paid vacation in accordance with the plans, policies, programs and
practices of the Company applicable to similarly situated employees
of the Company generally.
4A.
NOTICES . All notices and other communications under
this Agreement shall be in writing and shall be given by
first-class mail, certified or registered with return receipt
requested or hand delivery acknowledged in writing by the recipient
personally, and shall be deemed to have been duly given three days
after mailing or immediately upon duly acknowledged hand delivery
to the respective persons named below:
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If to the Company:
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Ticketmaster L.L.C.
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8800 Sunset Boulevard
West Hollywood, CA 90069
Attention: General Counsel
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With a copy to:
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InterActiveCorp.
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152 West 57 th Street
New York, NY 10019
Attention: General Counsel
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If to Employee:
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Eric Korman
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911 Park Avenue
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New York, New York 10021
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Either party may change such
party’s address for notices by notice duly given pursuant
hereto.
5A.
GOVERNING LAW;
JURISDICTION . This
Agreement and the legal relations thus created between the parties
hereto shall be governed by and construed under and in accordance
with the internal laws of the State of California without reference
to the principles of conflicts of laws. Any and all disputes
between the parties which may arise pursuant to this Agreement will
be heard and determined before an appropriate federal court in
California, or, if not maintainable therein, then in an appropriate
California state court. The parties acknowledge that such courts
have jurisdiction to interpret and enforce the
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provisions of this Agreement, and
the parties consent to, and waive any and all objections that they
may have as to, personal jurisdiction and/or venue in such
courts.
6A.
COUNTERPARTS
. This Agreement may be executed in
several counterparts, each of which shall be deemed to be an
original but all of which together will constitute one and the same
instrument. Employee expressly understands and acknowledges that
the Standard Terms and Conditions attached hereto are incorporated
herein by reference, deemed a part of this Agreement and are
binding and enforceable provisions of this Agreement. References to
“this Agreement” or the use of the term
“hereof” shall refer to this Agreement and the Standard
Terms and Conditions attached hereto, taken as a whole.
7A.
RELOCATION
.
(i)
Except as otherwise prohibited by
applicable laws or regulations, the Company shall reimburse
Employee for his actual, reasonable and documented expenses
relating to relocating from New York to California, as provided by
Company policy as such policy may be amended from time to time, up
to a total relocation allowance consistent with the Executive Level
of IAC corporate policy. Employee must complete his relocation on
or before April 10, 2007 in order to receive the relocation
allowance.
(ii)
Should Employee’s employment
terminate for any reason other than Cause, as defined in the
Standard Terms and Conditions, at any time during the first year of
the Term, the Company shall relocate Employee to New York, New York
on the same terms as set forth in paragraph
7(A)(i) hereinabove.
8A.
SECTION 409A
. The benefits provided under
this Agreement shall comply with Section 409A of the Code and
the regulations thereunder. To the extent so required in order to
comply with Section 409A of the Code, (i) amounts and
benefits to be paid or provided under this Agreement shall be paid
or provided to Employee in a single lump sum on the first business
day after the date that is six months following the date of
termination of Employee’s employment or shall begin six
months and one day following the date of termination, and
(ii) the Company and Employee agree to amend or modify this
Agreement and any agreements relating hereto as may be necessary to
comply with Section 409A of the Code.
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IN WITNESS WHEREOF, the Company has
caused this Agreement to be executed and delivered by its duly
authorized officer and Employee has executed and delivered this
Agreement as of April 11 th , 2006.
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TICKETMASTER L.L.C.
8800 Sunset Boulevard
West Hollywood, CA 90069
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By:
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/s/ Edward J. Weiss
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Name: Edward J. Weiss
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Title:
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EVP, GC
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By:
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/s/ Eric Korman
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EMPLOYEE
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STANDARD TERMS AND
CONDITIONS
1.
TERMINATION OF EMPLOYEE’S
EMPLOYMENT .
(a)
DEATH . In the event Employee’s employment
hereunder is terminated by reason of Employee’s death, the
Company shall pay Employee’s designated beneficiary or
beneficiaries, within 30 days of Employee’s death, in a lump
sum in cash, Employee’s Base Salary through the end of the
month in which death occurs and any Accrued Obligations (as defined
in paragraph 1(g) below).
(b)
DISABILITY
. If, as a result of
Employee’s incapacity due to physical or mental illness
(“Disability”), Employee shall have been absent from
the full-time performance of Employee’s duties with the
Company for a period of four consecutive months and, within 30 days
after written notice is provided to Employee by the Company (in
accordance with Section 4A above), Employee shall not have
returned to the full-time performance of Employee’s duties,
Employee’s employment under this Agreement may be terminated
by the Company for Disability. During any period prior to such
termination during which Employee is absent from the full-time
performance of Employee’s duties with the Company due to
Disability, the Company shall continue to pay Employee’s Base
Salary at the rate in effect at the commencement of such period of
Disability, offset by any amounts payable to Employee under any
disability insurance plan or policy provided by the Company. Upon
termination of Employee’s employment due to Disability, the
Company shall pay Employee within 30 days of such termination
(i) Employee’s Base Salary through the end of the month
in which termination occurs in a lump sum in cash, offset by any
amounts payable to Employee under any disability insurance plan or
policy provided by the Company; and (ii) any Accrued
Obligations (as defined in paragraph 1(g) below).
(c)
TERMINATION FOR CAUSE;
RESIGNATION BY EMPLOYEE WITHOUT GOOD REASON . The Company may terminate Employee’s
employment under this Agreement for Cause at any time prior to the
expiration of the Term. The Employee may resign from his employment
with the Company without Good Reason upon 30 days’ written
notice to the Company. In the event of Employee’s termination
for Cause or upon Employee’s resignation without Good Reason,
this Agreement shall terminate without further obligation by the
Company, except for the payment of any Accrued Obligations (as
defined in paragraph 1(g) below).
As used herein, “Cause”
shall mean: (i) the plea of guilty or nolo contendere to, or
conviction for, the commission of a felony offense by Employee;
provided , however , that after indictment, the
Company may suspend Employee from the rendition of services, but
without limiting or modifying in any other way the Company’s
obligations under this Agreement; (ii) a material breach by
Employee of a fiduciary duty owed to the Company; (iii) a
material breach by Employee of any of
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the covenants made by Employee in
Section 2 hereof; (iv) the willful or gross neglect by
Employee of the material duties and responsibilities required by
this Agreement; (v) a material breach by the Employee of his
duty not to engage in any transaction that represents, directly or
indirectly, self-dealing with the Company or any Company Affiliate
which has not been approved by a majority of the disinterested
directors of the Company’s Board of Directors, if such
material breach remains uncured after the lapse of 30 days
following the date that the Company has given Employee written
notice thereof; (vi) any act of misappropriation,
embezzlement, intentional fraud or similar misconduct involving the
Company or any Company Affiliate; (vii) a material violation
of any written Company policy pertaining to ethics, wrongdoing or
conflicts of interest; and (viii) the repeated
non-prescription abuse of any controlled substance which, in any
case described in this clause, the Company’s Board of
Directors reasonably determines renders the Employee unfit to serve
in his capacity as an officer or employee of the Company or any
Company Affiliate; provided that before a cessation of
Employee’s employment shall be deemed to be a termination of
Employee’s employment for Cause, (A) the Company shall
provide written notice to Employee that identifies the conduct
described in clauses (ii), (iii) or (iv) above, as
applicable, and (B) in the event that the event or condition
is curable, Employee shall have failed to remedy such event or
condition within 30 days after Employee shall have received from
the Company the written notice described in clause
(A) above.
As used herein, “Good
Reason” shall mean the occurrence of any of the following
without Employee’s written consent, (i) a material
adverse change in Employee’s title, duties, operational
authorities or reporting responsibilities from those in effect
immediately following the Effective Date, excluding for this
purpose any such change that is an isolated and inadvertent action
not taken in bad faith and that is remedied by the Company promptly
after receipt of notice thereof given by the Employee or that is
authorized pursuant to this Agreement; (ii) any reduction in
Base Salary or any of the benefits described in Section 3A of
this Agreement as described above; (iii) failure by the
Company to pay Employee his Signing Bonus or grant the Employee the
Restricted Stock Units as contemplated by Sections 3A(b) and
3A(c) of this Agreement, respectively, on the terms and
conditions provided in such sections; or (iv) a relocation of
Employee’s principal place of business more than 50 miles
from the Los Angeles, California metropolitan area.
(d)
TERMINATION BY THE COMPANY OTHER
THAN FOR DEATH, DISABILITY OR CAUSE; RESIGNATION BY EMPLOYEE FOR
GOOD REASON . Upon
termination of Employee’s employment prior to expiration of
the Term (A) by the Company for any reason other than
Employee’s death or Disability or for Cause or (B) upon
Employee’s resignation for Good Reason, the Company shall pay
Employee, (i) in accordance with its normal payroll practices,
the Employee’s Base Salary through the end of the Term and
(ii) within 30 days of the date of such termination in a lump
sum in cash any Accrued Obligations (as defined in paragraph
1(g) below). The payment to Employee of the severance
benefits
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described in this
Section 1(d) shall be subject to Employee’s
execution and non-revocation of a general release of the Company
and the Company Affiliates in a form substantially similar: to that
used for similarly situated executives of the Company and the
Company Affiliates and attached hereto as
Exhibit A.
(e)
NOTICE OF TERMINATION
. Any termination of
Employee’s employment, whether by the Company or by the
Employee, shall require a notice of termination to be issued by the
Company or the Employee to the other party. The notice of
termination shall specify the effective date of the termination and
shall set forth in reasonable detail the basis for such termination
by the Company or the Employee.
(f)
MITIGATION; OFFSET
. In the event of termination of
Employee’s employment prior to the end of the Term, in no
event shall Employee be obligated to seek other employment or take
any other action by way of mitigation of severance benefits or
other compensation or benefits. If Employee obtains other
employment during the Term, the amount of any severance payments to
be made to Employee under Section 1(d) hereof after the
date such employment is secured shall be offset by the amount of
compensation earned by Executive from such employment through the
end of the Term. For purposes of this Section 1(f), Employee
shall have an obligation to inform the Company promptly regarding
Employee’s employment status following termination and during
the period encompassing the Term.
(g)
ACCRUED OBLIGATIONS
. As used in this Agreement,
“Accrued Obligations” shall mean the sum of
(i) any portion of Employee’s Base Salary through the
date of death or termination of employment for any reason, as the
case may be, which has not yet been paid; (ii) any
compensation previously earned but deferred by Employee (together
with any interest or earnings thereon) that has not yet been paid;
and (iii) any unused vacation time accrued through the date of
the Employee’s termination of employment for any
reason.
2.
CONFIDENTIAL INFORMATION;
NON-SOLICITATION; AND PROPRIETARY RIGHTS .
(a)
CONFIDENTIALITY
. Employee acknowledges that while
employed by the Company Employee will occupy a position of trust
and confidence. Employee shall not, except (i) as may be
required to perform Employee’s duties hereunder,
(ii) required by applicable law, (iii) as may be required
by a court of competent jurisdiction, or any governmental agency
having supervisory authority over the business of the Company or
any administrative body or legislative body (including a committee
thereof) with jurisdiction to order Employee to divulge, disclose
or make accessible such information or (iv) with the
Company’s consent, without limitation in time or until such
information shall have become public other than by Employee’s
unauthorized disclosure, disclose to others or use, whether
directly or indirectly, any Confidential Information regarding the
Company or any of its subsidiaries or
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Company Affiliates.
“Confidential Information” shall mean information about
the Company or any Company Affiliates, and their clients and
customers that is not disclosed by the Company or any Company
Affiliates for financial reporting purposes and that was learned by
Employee in the course of employment by the Company or any Company
Affiliates, including (without limitation) any proprietary
knowledge, trade secrets, data, formulae, information and client
and customer lists and all papers, resumes, and records (including
computer records) of the documents containing such Confidential
Information. Employee acknowledges that such Confidential
Information is specialized, unique in nature and of great value to
the Company and the Company Affiliates, and that such information
gives the Company and the Company Affiliates a competitive
advantage. Employee agrees to deliver or return to the Company, at
the Company’s request at any time or upon termination or
expiration of Employee’s employment or as soon thereafter as
possible, all documents, computer tapes and disks, records, lists,
data, drawings, prints, notes and written information (and all
copies thereof) furnished by the Company and the Company Affiliates
or prepared by Employee in the course of Employee’s
employment by the Company and the Company Affiliates.
(b)
NON-SOLICITATION OF
EMPLOYEES . Employee
recognizes that he will possess confidential information about
other employees of the Company and the Company Affiliates relating
to their education, experience, skills, abilities, compensation and
benefits, and inter-personal relationships with suppliers to and
customers of the Company and the Company Affiliates. Employee
recognizes that the information he will possess about these other
employees is not generally known, is of substantial value to the
Company and the Company Affiliates in developing their respective
businesses and in securing and retaining customers, and will be
acquired by Employee because of Employee’s business position
with the Company. Employee agrees that, during Employee’s
employment and during the period commencing immediately upon the
termination of Employee’s employment for any reason and
ending on the later of (i) the end of the Term and
(ii) the second anniversary of the date of termination of
Employee’s employment (the “Non-Solicit Period”),
Employee will not, directly or indirectly, solicit or recruit any
employee of the Company or any of the Company Affiliates for the
purpose of being employed by Employee or by any business,
individual, partnership, firm, corporation or other entity on whose
behalf Employee is acting as an agent, representative or employee
and that Employee will not convey any such confidential information
or trade secrets about other employees of the Company or any of the
Company Affiliates to any other person except within the scope of
Employee’s duties hereunder; provided , however
, that the restrictions in this paragraph shall not prohibit
Employee (i) from placing advertisements in newspapers or
other media of general circulation advertising employment
opportunities and (ii) from hiring persons who respond to such
advertisements, provided that they were not otherwise solicited by
Employee in violation of this section. The mere fact that Employee
is an employee of a company, business, partnership, firm,
corporation or other entity soliciting employees of the
Company,
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without the Employee’s
involvement in the solicitation, will not cause Employee to violate
this provision.
(c)
NON-SOLICITATION OF
CUSTOMERS . During
Employee’s employment and during the Non-Solicit Period,
Employee shall not induce or attempt to induce any Customer of the
Company or any Company Affiliate to cease doing business with the
Company or any Company Affiliate, or in any way interfere with the
relationship between any such Customer on the one hand, and the
Company or any Company Affiliate, on the other hand; provided,
however, that, for the avoidance of doubt, nothing in this
paragraph shall be deemed to prohibit Employee from calling upon or
soliciting a Customer during the Non-Solicit Period if such action
relates to a product or service not sold or performed by the
Company. The mere fact that Employee is an employee of a company,
business, partnership, firm, corporation or other entity soliciting
customers or suppliers of the Company, without the Employee’s
involvement, directly or indirectly, in the solicitation, will not
cause Employee to violate this provision. “Customer”
shall mean any person who engages the Company or any of the Company
Affiliates to sell, on its behalf as agent, tickets to the
public.
(d)
PROPRIETARY RIGHTS;
ASSIGNMENT . All Employee
Developments shall be made for hire by the Employee for the Company
or any of the Company Affiliates. “Employee
Developments” means any idea, discovery, invention, design,
method, technique, improvement, enhancement, development, computer
program, machine, algorithm or other work or authorship that
(i) relates to the business or operations of the Company or
any of the Company Affiliates, or (ii) results from or is
suggested by any undertaking assigned to the Employee or work
performed by the Employee for or on behalf of the Company or any of
the Company Affiliates, whether created alone or with others,
during or after working hours. All Confidential Information and all
Employee Developments shall remain the sole property of the Company
or any of the Company Affiliates. The Employee shall acquire no
proprietary interest in any Confidential Information or Employee
Developments developed or acquired during the
