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Exhibit 10.1
AMENDED AND
RESTATED
EMPLOYMENT AGREEMENT
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT, dated as of June 6, 2007 (this “
Agreement ”), between SIRIUS SATELLITE RADIO INC., a Delaware
corporation (the “ Company ”), and JAMES
E. MEYER (the “ Executive ”).
WHEREAS, the Company and the
Executive previously entered into an amended and restated
employment agreement dated as of March 11, 2005, as amended as of
February 2, 2006 (the “ Prior
Agreement ”), which Prior
Agreement by its terms expired on April 16, 2007; and
WHEREAS, since that date, the
Executive’s employment with the Company has continued on the
same terms and conditions as set forth in the Prior Agreement, and
the Company and the Executive jointly desire to enter into this
Agreement, which is intended to amend and restate the Prior
Agreement in its entirety, to reflect the terms and conditions of
the Executive’s continued employment with the
Company.
In
consideration of the mutual covenants and conditions set forth
herein, the Company and the Executive hereby agree as
follows:
1. Employment
. Subject to the terms and conditions of this
Agreement, the Company hereby continues to employ the Executive,
and the Executive hereby accepts continued employment with the
Company.
2. Duties and Reporting Relationship . (a) The Executive shall be employed in the capacity of
President, Operations and Sales, of the Company. In such capacity,
the Executive shall be responsible for management of all aspects of
the Company’s retail and automaker operations (including
retail sales and OEM sales and marketing operations), customer care
and retention, product management and engineering and all personnel
working in such areas shall report to the Executive. During the
Term (as defined below), the Executive shall, on a full-time basis
and consistent with the needs of the Company to achieve the goals
of the Company, use his skills and render services to the best of
his ability in supervising the business and affairs of the Company.
In addition, the Executive shall perform such other activities and
duties consistent with his position as the Chief Executive Officer
of the Company or the Board of Directors of the Company or any
committee thereof (the “ Board ”) shall from
time to time reasonably specify and direct. During the Term, the
Executive shall not perform any consulting services for, or engage
in any other business enterprises with, any third parties without
the express consent of the Board, other than (i) passive
investments, (ii) consulting services and business enterprises for
which the Executive receives no remuneration, and (iii) service as
a director of Gemstar International, Inc. or service on other
boards of directors with the express consent of the Chief Executive
Officer of the Company.
(b)
The Executive shall generally perform his duties and conduct his
business at the principal offices of the Company in New York, New
York.
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(c)
The Executive shall report to the Chief Executive Officer of the
Company.
3. Term . The term of this
Agreement shall be considered to commence as of April 16, 2007, and
shall end on April 30, 2010, unless terminated earlier pursuant to
the provisions of Section 6 (the “ Term ”).
4. Compensation . (a) During the
Term, the Executive shall be paid an annual base salary of $900,000
(the “ Base Salary
”). The Base Salary shall be subject to
increase from time to time by recommendation of the Chief Executive
Officer of the Company to, and approval by, the Board. All amounts
paid to the Executive under this Agreement shall be in U.S.
dollars. The Base Salary shall be paid at least monthly and, at the
option of the Company, may be paid more frequently.
(b)
During the Term, the Executive shall be entitled to participate in
any bonus plans generally offered to employees at the same level.
Bonuses are subject to the Executive’s individual performance
and satisfaction of objectives established by the Board, and the
Compensation Committee thereof. Bonuses may be paid in the form of
cash, restricted stock, restricted stock units, other securities of
the Company or any combination thereof. The Executive shall not be
entitled to any guaranteed bonus.
(c)
All compensation paid to the Executive hereunder shall be subject
to any payroll and withholding deductions required by applicable
law.
5. Additional Compensation; Expenses and Benefits
. (a) During the Term, the Company shall
reimburse the Executive for all reasonable and necessary business
expenses incurred and advanced by him in carrying out his duties
under this Agreement. In addition, the Company shall reimburse the
Executive for the reasonable costs of an apartment in the New York
metropolitan area and other incidental living expenses (e.g.,
phone, cable, electric, gas, one month’s security deposit
(which shall be returned to the Company at the end of the Term) and
one leasing broker’s commission), up to a maximum of $5,000
per month for rent. The Company shall also reimburse the Executive
for the reasonable costs of coach class air-fare from the
Executive’s home in Indianapolis, Indiana, to the
Company’s executive offices in New York City. The Executive
shall also be paid such additional amount as may be necessary to
hold the Executive harmless as a result of any federal, state or
New York City income taxes that may be due solely as a result of
the Company’s reimbursement of rent and living expenses and
reimbursement of air-fare from the Executive’s home in
Indianapolis, Indiana. The Executive shall present to the Company
an itemized account of all expenses in such form as may be required
by the Company from time to time.
(b)
During the Term, the Executive shall be entitled to participate in
any other benefit plans, programs, policies and fringe benefits
which may be made available to the executive officers of the
Company generally, including, without limitation, disability,
medical, dental and life insurance and benefits under the Sirius
Satellite Radio 401(k) Savings Plan.
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(c)
With respect to any stock options granted by the Company to the
Executive after the date hereof during the Term, such stock options
shall provide that, upon a termination of employment due to the
Executive’s death, such stock options shall become vested
with respect to that portion of the options that would have
otherwise become vested within 12 months following the date of such
termination of employment. With respect to the restricted stock
unit grant made to the Executive by the Company dated as of
February 1, 2007, and with respect to any portion of the
Executive’s annual bonus that is paid in the form of a
restricted stock unit grant by the Company to the Executive after
the date hereof during the Term (each such grant, an “
RSU ”),
such RSU shall provide for the same vesting and payment terms upon
a termination of employment hereunder due to Scheduled Retirement
pursuant to Section 6(c)(ii) or following the Merger pursuant to
Section 6(c)(iii) as are provided under such RSU upon a termination
of employment without “cause” (as defined
therein).
6. Termination . The date upon
which the Executive’s employment and the Term are deemed to
be terminated in accordance with any of the provisions of this
Section 6 is referred to herein as the “
Termination Date .”
(a)
The Company has the right and may elect to terminate the Term and
the Executive’s employment for Cause at any time. For
purposes of this Agreement, “ Cause ” means the
occurrence or existence of any of the following:
(i)
a material breach by the Executive of (A) the terms of this
Agreement or (B) his duty not to engage in any transaction that
represents, directly or indirectly, self-dealing with the Company
or any of its subsidiaries (which, for purposes hereof, shall mean
any individual, corporation, partnership, association, limited
liability company, trust, estate, or other entity or organization
directly or indirectly controlling, controlled by, or under direct
or indirect common control with the Company) which has not been
approved by a majority of the disinterested directors of the Board,
if any such material breach described in clause (A) or clause (B)
remains uncured after thirty days have elapsed following the date
on which the Company gives the Executive written notice of such
breach;
(ii)
a material breach by the Executive of any duty referred to in
clause (i) above with respect to which at least one prior notice
was given under clause (i);
(iii)
any act of dishonesty, misappropriation, embezzlement, intentional
fraud, or similar intentional misconduct by the Executive involving
the Company or any of its subsidiaries;
(iv)
the conviction or the plea of nolo contendere
or the equivalent in respect of a
felony;
(v)
any damage of a material nature to any property of the Company or
any of its subsidiaries caused by the Executive’s willful
misconduct or gross negligence;
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(vi)
the repeated nonprescription use of any controlled substance or the
repeated use of alcohol or any other non-controlled substance that,
in the reasonable good faith opinion of the Board, renders the
Executive unfit to serve as an officer of the Company;
(vii)
the Executive’s failure to comply with the reasonable written
instructions of the Chief Executive Officer of the Company within
five days; or
(viii)
conduct by the Executive that in the reasonable good faith written
determination of the Board demonstrates unfitness to serve as an
officer of the Company, including, without limitation, a finding by
the Board or any judicial or regulatory authority that the
Executive committed acts of unlawful harassment or violated any
other state, federal or local law or ordinance prohibiting
discrimination in employment.
Termination of the Executive for
Cause pursuant to this Section 6(a) shall be communicated by a
Notice of Termination. For purposes of this Agreement, a
“ Notice of
Termination ” shall mean
delivery to the Executive of a copy of a resolution or resolutions
duly adopted by the affirmative vote of not less than two-thirds of
the directors (other than the Executive, if the Executive is then
serving on the Board) present (in person or by teleconference) and
voting at a meeting of the Board called and held for that purpose
after reasonable notice to the Executive and reasonable opportunity
for the Executive, together with the Executive’s counsel, to
be heard before the Board prior to such vote, finding that in the
good faith opinion of the Board, the Executive was guilty of
conduct set forth in any of clauses (i) through (viii) of this
Section 6(a) and specifying the particulars thereof in reasonable
detail. For purposes of this Section 6(a), the Executive’s
employment and the Term shall terminate on the date specified by
the Board in the Notice of Termination.
(b)
(i) The Executive’s employment
and the Term shall terminate upon the death of the
Executive.
(ii)
If the Executive is unable to perform the essential duties and
functions of his position because of a disability, even with a
reasonable accommodation, for one hundred eighty days within any
three hundred sixty-five day period, the Board shall have the right
and may elect to terminate the services of the Executive by a
Notice of Disability Termination. The Executive shall not be
terminated following a Disability except pursuant to this Section
6(b)(ii). For purposes of this Agreement, a “
Notice of Disability Termination
” shall mean a written notice that sets
forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive’s employment
under this Section 6(b)(ii). For purposes of this Agreement, no
such purported termination by the Board shall be effective without
such Notice of Disability Termination. The Executive’s
employment and the Term shall terminate on the day such Notice of
Disability Termination is received by the Executive.
(c)
(i) The Executive may elect to resign
from his employment with the Company at any time during the Term
for other than Good Reason. Should the Executive wish to resign
from his employment with the Company during the Term for other than
Good Reason, and not due to Scheduled Retirement pursuant to
Section 6(c)(ii) nor following the Merger pursuant to Section
6(c)(iii), the Executive shall give fourteen days prior written
notice to the
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Company of such a resignation
for other than Good Reason pursuant to this Section 6(c)(i). The
Executive’s employment and the Term shall terminate on the
effective date of such resignation; provided that the Company
may, at its sole discretion, instruct the Executive to perform no
job responsibilities and cease his active employment immediately
upon receipt of the notice from the Executive.
(ii)
The Executive may elect to resign from his employment with the
Company during the Term for other than Good Reason, due to
Scheduled Retirement. For purposes hereof, “
Scheduled Retirement ” means the voluntary retirement from employment
hereunder of the Executive; provided that the Executive
provides the Company with 60 days’ prior written notice of
his resignation under this Section 6(c)(ii), and such Scheduled
Retirement may only occur during either April 2008, April 2009 or
April 2010. In the event of such Scheduled Retirement, the
Executive shall be entitled to the severance payments and benefits
set forth in Section 6(f) (subject to his execution and
non-revocation of the release described in Section 6(f)), but such
Scheduled Retirement shall be treated as a voluntary resignation
for all other purposes hereunder. The Executive’s employment
and the Term shall terminate on the effective date of such
Scheduled Retirement; provided that the Company
may, at its sole discretion, instruct the Executive to perform no
job responsibilities and cease his active employment immediately
upon receipt of the notice from the Executive.
(iii)
The Executive may elect to resign from his employment with the
Company during the Term for other than Good Reason following the
consummation of the transactions contemplated by the Agreement and
Plan of Merger dated as of February 19, 2007 by and among the
Company, Vernon Merger Corporation and XM Satellite Radio Holdings
Inc. (the “ Merger
”), subject to the requirements of this
Section 6(c)(iii). The Executive must provide the Company with 60
days’ prior written notice of his resignation pursuant to
this Section 6(c)(iii), and the Termination Date may only occur
during April 2008 or April 2009. In the event that the Merger is
consummated in April 2008 or at such time prior to April 2008 that
the Executive would not have sufficient time to provide the Company
with 60 days’ prior written notice, delivered after the
consummation of the Merger and to be effective during April 2008,
then, notwithstanding the preceding sentence, the Executive may at
any time after the consummation of the Merger and prior to the date
that is 90 days following the consummation of the Merger notify the
Company that he has elected to resign his employment with the
Company pursuant to this Section 6(c)(iii), and such resignation
shall be effective 60 days following the Executive’s written
notice to the Company. In the event the Executive resigns in
accordance with this Section 6(c)(iii), the Executive shall be
entitled to the severance payments and benefits set forth in
Section 6(g) (subject to his execution and non-revocation of the
release described in Section 6(g)), but such resignation shall be
treated as a voluntary resignation for all other purposes
hereunder. The Executive’s employment and the Term shall
terminate on the effective date of such resignation;
provided that
the Company may, at its sole discretion, instruct the Executive to
perform no job responsibilities and cease his active employment
immediately upon receipt of the notice from the
Executive.
(d)
The Company shall have the absolute right to terminate the Term and
the Executive’s employment without Cause at any time. The
Executive’s employment and the Term shall terminate one day
following receipt of such notice by the Executive. However,
the
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Company may, at its sole
discretion, instruct the Executive to cease active employment and
perform no more job duties immediately upon provision of such
notice to the Executive.
(e)
The Executive shall have the absolute right to terminate his
employment at any time. Should the Executive wish to resign from
his employment with the Company during the Term for Good Reason,
the Executive shall give seven days prior written notice to the
Company or, if other than for Good Reason, fourteen days prior
written notice to the Company (or 60 days in the case of Scheduled
Retirement effected pursuant to Section 6(c)(ii) or resignation
following the Merger effected pursuant to Section 6(c)(iii)). The
Executive’s employment and the Term shall terminate on the
date specified in such notice given in accordance with the relevant
provision; provided
that the Company may, at its sole discretion,
instruct the Executive to cease active employment and perform no
more job duties immediately upon receipt of such notice from the
Executive.
For purposes of this
Agreement, “ Good
Reason ” shall mean the
continuance of any of the following events (without the
Executive’s prior written consent) for a period of thirty
days after delivery to the Company by the Executive of a notice of
the occurrence of such event:
(i)
the assignment to the Executive by the Company of duties not
reasonably consistent with the Executive’s positions, duties,
responsibilities, titles or offices set forth in Section 2(a), any
material reduction in his duties or responsibilities or any removal
of the Executive from or any failure to re-elect the Executive to
any of such positions or the Executive not being the sole officer
of the Company, other than the Company’s Chief Executive
Officer, responsible for all sales, engineering and product
development activities and personnel (except in connection with the
termination of the Executive’s employment for Cause,
disability or as a result of the Executive’s death or by the
Executive other than for Good Reason); or
(ii)
the Executive ceasing to report directly to the Chief Executive
Officer of the Company; or
(iii)
any requirement that the Executive report for work to a location
more than 25 miles from the Company’s current headquarters
for more than 30 days in any calendar year, excluding any
requirement that results from the damage or destruction of the
Company’s current headquarters as a result of natural
disasters, terrorism, acts of war or acts of God or travel in the
ordinary course of business; or
(iv)
any reduction in the Base Salary; or
(v)
any material breach by the Company of this Agreement.
(f)
Subject to Section 6(g), if the employment of the Executive is
terminated without Cause, or if the Executive terminates his
employment for Good Reason or for Scheduled Retirement, then the
Executive shall be entitled receive, and the Company shall pay to
the Executive:
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(i) without
setoff, counterclaim or other withholding, except as set forth in
Section 4(c), a lump sum cash amount (in addition to any salary,
benefits or other sums due the Executive through the Termination
Date) equal to the sum of (x) his annual Base Salary at the rate in
effect on the Termination Date plus (y) the greater of (A) a
bonus equal to 60% of Base Salary, or (B) the prior year’s
annual bonus actually paid to the Executive by the
Company;
(ii) the
continuation of medical and dental insurance benefits, on the same
terms as provided by the Company for active employees, under the
Consolidated Omnibus Reconciliation Act of 1985 (“
COBRA ”)
for eighteen months (twelve months in the case of a Scheduled
Retirement) following the Termination Date; and
(iii) a
monthly amount equal to the actual monthly costs to the Executive
to obtain life insurance benefits substantially similar to those
benefits provided to the Executive for a period of one year
following such Termination Date; provided that (1) the amount
of such monthly payments shall not exceed twice the amount that the
Company would have paid to provide such life insurance benefit to
the Executive if he were an active employee, and (2) such payments
shall cease if the Executive obtains a life insurance benefit from
another employer during the remainder of such one-year
period.
The Company’s obligations
under this Section 6(f) shall be conditioned upon the Executive
executing and delivering an agreement and waiver and release of
claims against the Company in the form attached as
Exhibit A .
Subject to Section 6(h), any amount becoming payable under Section
6(f)(i) shall be paid in immediately available funds on the tenth
business day following the Termination Date; provided that the Executive
has not revoked such agreement and waiver and release of claims in
accordance with the terms thereof prior to such payment
date.
(g) Notwithstanding
Section 6(f), if the employment of the Executive is terminated
without Cause or the Executive terminates his employment for Good
Reason, in each case during the 12 month period following the
consummation of the Merger, then in lieu of (and not in addition
to) the amounts set forth in Section 6(f), the Executive shall be
entitled to receive, and the Company shall pay to the Executive,
the amounts set forth in this
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