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EXHIBIT 99.3
EMPLOYMENT AGREEMENT
This
AMENDED AND RESTATED EMPLOYMENT AGREEMENT, originally dated as
of
March 15, 2000, and amended and restated on
July 1, 2005 (the "Restatement
Date"), originally entered into between
MediaNews Services, Inc., a Delaware
corporation, whose rights and obligations
have been assigned to and assumed by
MediaNews Group, Inc. (the "Company"), a
Delaware corporation, and Joseph J.
Lodovic, IV ("Executive"). Capitalized
terms used but not defined herein are
used as defined in Section 12.
WITNESSETH:
WHEREAS,
the Company wishes to employ and retain the services of
Executive, and Executive wishes to be
employed by the Company.
NOW,
THEREFORE, in consideration of the mutual covenants herein
contained,
this Agreement is hereby amended and
restated, to read in full, and the Company
and the Executive hereby agree, as
follows:
1. Period of
Employment.
Company
shall employ the Executive to perform the services described
herein, with his principal office
activities being situated in Denver, Colorado,
or such other location as the Executive and
the Company's Chief Executive
Officer shall mutually agree upon, for the
period commencing January 1, 2000,
and terminating December 31, 2009, unless
earlier terminated as provided herein
or extended as provided in the next
paragraph. Upon termination of this
Agreement, Executive's employment with the
Company and its subsidiaries shall
terminate.
Effective
January 1, 2010, this Agreement shall be automatically renewed
for additional periods of one year each
unless either party shall have given
notice to the other at least one hundred
twenty (120) days prior to December 31,
2009 or the expiration of any subsequent
one-year term, electing not to renew
this Agreement, in which case this
Agreement shall terminate on the next
succeeding December 31.
2.
Compensation.
During the
period of his employment, Executive shall:
(a) be paid a base salary, in equal monthly installments, on
the
regular
pay day established for executives of the Company, at the
annual
rate of
six hundred fifty five thousand two hundred Dollars
($655,200.00),
which
salary shall be increased annually, commencing January 1, 2006,
at
an annual
rate of five percent (5%), or such higher annual rate as the
Board of
Directors of the Company shall determine appropriate; provided,
that if
the Company's Chief Executive Officer determines that business
conditions
are such that all or a portion of the foregoing increases
should be
delayed until such time as those conditions improve, then
concurrently with the Chief Executive Officer's decision to delay
similar
annual
increases relative to his own salary, such increases may
appropriately be delayed;
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2
(b) be reimbursed in a manner consistent with policies of the
Company
established for executive personnel, for all reasonable
expenses
of the
Company and its subsidiaries incurred by the Executive in the
discharge
of any duties hereunder;
(c) receive such fringe benefits including accident,
hospitalization, disability, medical and life insurance plans, as
shall be
made
generally available to the executive personnel or other employees
of
the
Company or as otherwise approved by the Company's Chief
Executive
Officer;
(d) have an appropriate opportunity, commensurate with his
executive
stature,
to participate in all stock options, restricted stock or other
forms of
equity ownership plans, and incentive plans which may be
established for executive personnel of the Company;
(e) be eligible to receive an annual bonus for each of the
Company's
fiscal
years (commencing with the fiscal year ended June 30, 2005)
commencing
before the termination of this Agreement (pro rated for partial
years
prior to termination hereof based on performance for the full
fiscal
year) of
up to $400,000 payable as soon as practicable after completion
by
the Company's independent
accountants of their audit of the Company for
the
relevant fiscal year (but in no event later than the March 15
immediately following the end of the relevant fiscal year), based
on a
comparison
of operating profits to the budget of the Company approved by
the
Company's Board of Directors for such fiscal year as follows (or
in
such
greater amounts as may be approved by the Company's Board of
Directors):
(i) If operating
profits for such fiscal year are 100% or
more of budget, then the bonus amount payable shall be
$350,000, plus 5% of the excess of operating profits
over budget, up to a total of an additional $50,000
(i.e. a maximum bonus of $400,000);
(ii) If operating
profits for such fiscal year are 95% or
more (but under 100%) of budget, then the bonus amount
payable shall be $300,000;
(iii) If operating profits for such fiscal year are 90% or
more (but under 95%) of budget, then the bonus amount
payable shall be $250,000;
(iv) If operating
profits for such fiscal year are 85% or
more (but under 90%) of budget, then the bonus amount
payable shall be $150,000;
(v) If operating
profits for such fiscal year are 80% or
more (but under 85%) of budget, or if no budget has been
adopted and approved for such fiscal year, then the
bonus amount payable shall be $100,000; and
(vi) If operating
profits for such fiscal year are under 80%
of budget, then no bonus shall be payable; and
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(f) a one-time bonus of $100,000.
All
payments made payable to the Executive under this Agreement shall
be
subject to withholding for any applicable
taxes, social security or other
governmental levies.
3.
Duties.
The
Executive shall serve as President of the Company, reporting to
the
Chief Executive Officer of the Company.
The
Executive accepts the aforementioned responsibilities at the
compensation and upon the terms specified
herein. During the term of this
Agreement, Executive shall devote his best
efforts principally to the service of
the Company, its affiliates and their
subsidiaries and the performance of the
duties specified above, it being understood
that the preponderance of
Executive's time will be applied to
furthering the interest of such entities.
Except at the request of the Company,
Executive shall not engage in any other
business activity or outside activity which
is materially inconsistent with or
an impediment to the carrying out of his
duties hereunder, provided that, so
long as it does not materially interfere
with the performance of his duties
hereunder, Executive may serve as a
director, trustee or officer of, or
otherwise participate in, trade,
professional, educational, welfare, social,
religious and civic organizations.
4.
Vacation.
Executive
shall be entitled to an annual paid vacation of five weeks,
such
vacation to be taken at such times as he
may select.
5. Death
or Incapacity.
In the
event of death of Executive during the term hereof, this
Agreement
shall terminate.
If, on
account of physical or mental disability, Executive shall fail
or
be unable to perform the duties
contemplated by this Agreement for a period of
180 consecutive days, the Company may, at
any time thereafter upon 30 days'
notice to Executive, terminate this
Agreement. In such event, this Agreement
shall terminate and come to an end on the
date set forth in such notice as if
such date were the termination date of this
Agreement.
In the
case of termination of this Agreement pursuant to this Section
5,
except for the rights of Executive and his
beneficiaries under the benefit plans
described in Sections 2(c) and 2(d) of this
Agreement, the Company shall not be
subject to any further obligation to
Executive (or his estate or legal
representatives) hereunder, except that
Executive (or his estate or legal
representatives) shall be entitled to
receive payment of unreimbursed expenses
pursuant to Section 2(b) of this Agreement
and the unpaid salary, vacation and
bonus due for service prior to termination
of this Agreement, and in the case of
the death of Executive through and
including the last day of the month in which
Executive died.
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6.
Covenant Not To Compete.
(a) Executive agrees that after any termination hereof (other
than
termination (i) by Executive pursuant to paragraphs (a) or (b) of
Section
7 hereof
or (ii) by the Company in breach of this Agreement), he will
not,
during the
Restricted Period (as defined below), unless with the prior
written
consent of the Board of Directors of the Company, engage in, or
materially
assist any other business enterprise in, the business of
publishing
and distributing daily newspapers in any geographical areas in
which
daily newspapers owned or managed by the Company and/or its
subsidiaries have paid print circulation in excess of 25,000 at the
time
of
termination of this Agreement; provided, however, that the
ownership of
up to 5%
of any class of publicly traded securities of any entity shall
not be
deemed to be a violation of this Section 6. "Restricted Period"
means, in
respect of the termination of Executive's employment, the
period
commencing
on the date of termination of employment and ending on the
first to
occur of (x) the date one year after the date a replacement for
Executive
is hired (or another officer of the Company takes over his
responsibilities) and (y) the second anniversary of the termination
of
Executive's employment.
(b) The parties intend that the covenants contained in paragraph
(a)
shall be
construed as a series of separate covenants, one for each state
and other
jurisdiction covered thereby, and one for each county and city
included
within such state or other jurisdiction and, except for
geographic
coverage, each such separate covenant shall be deemed
identical.
The parties agree that the covenants deemed included in
paragraph
(a) are, taken as a whole, reasonable in activities prohibited
and
geographic scope and their duration and no party shall raise any
issue
of the
reasonableness of the scope or duration of the covenants in any
proceeding
to enforce any such covenants. If, in any judicial proceeding,
a court
shall refuse to enforce any such separate covenant, then the
unenforceable covenant shall be modified in order to make it
acceptable to
the court
and enforced accordingly, or, if necessary, deemed eliminated
to
the extent
necessary to permit the remaining separate covenants to be
enforced.
Executive acknowledges that the remedy at law for any breach by
him of
this covenant will be inadequate and that the Company shall be
entitled
to injunctive relief for the same.
(c) Notwithstanding anything to the contrary in this Section 6,
the
provisions
of paragraph (a) of this Section 6 shall terminate and be
ineffective (whether before or after termination of Executive's
employment) from and after any Change in Control.
7.
Termination Of This Agreement For Certain Reasons.
(a) Either party may terminate this Agreement prior to its
stated
term in
the event of a material breach hereof by the other, provided
that
if such
breach is capable of cure, it is not cured within 30 days of
written
notice thereof delivered by the non-breaching party to the
breaching
party.
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(b) Executive may terminate this Agreement if his
responsibilities
and
stature as President of the Company are diminished in any
material
respect
below such responsibilities on the Restatement Date, and if
such
responsibilities and stature are not restored within 15 days of
written
notice of
diminishment thereof delivered to the Company.
(c) The Company may terminate this Agreement for "Cause" (as
defined
below).
(d) Executive may terminate this Agreement in his discretion at
any
time upon
90 days' prior notice to the Company.
(e) Termination pursuant to this Section 7 shall be by notice
in
writing
specifying such material breach or other grounds and shall be
effective
on the date said notice is deemed to be given (or such later
date
provided for in this Section 7), without prejudice to the rights
of
the party upon whom
such notice is served to contest such termination by
any
judicial means at such party's disposal.
(f) For purposes of termination of this Agreement by the
Company
pursuant
to paragraph (c), the following events shall be considered as
"Cause":
(i) unreasonable
failure by the Executive to perform his
material duties as provided in Section 3 hereof, after
he has received written notice from the Company of his
alleged failure to perform the same, and has failed
within a reasonable period of time to cure such failure;
(ii) theft,
embezzlement or misappropriation by the Executive
of any material funds or other property of the Company
or its subsidiaries; or
(iii) any conviction or a plea of nolo contendere with respect
to any felony or any other serious crime involving moral
turpitude.
8.
Termination by Executive Upon a Change in Control.
Executive
may terminate this Agreement prior to its stated term following
the occurrence of a Change in Control. Such
termination shall be by notice to
the Company in writing given during the one
hundred eighty (180) days following
such Change in Control.
9. Payment
Upon Termination in Certain Circumstances.
(a) If this Agreement is terminated by Executive pursuant to
paragraphs
(a) or (b) of Section 7 hereof, or by the Company in breach of
this
Agreement (except as provided in Section 9(b)), Executive shall
be
entitled
to receive a cash payment equal to the greater of (x) the
present
value
(based on the Company's then current cost of senior bank
borrowings)
of his
projected salary pursuant to Section 2(a) and bonuses pursuant
to
Section
2(e) (prior to any elective deferrals or any other deductions)
and
the
deemed
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value of
all fringe benefits for the balance of the term of this
Agreement
and (y) an
amount equal to 2 times the sum of (i) Executive's annual
salary in effect at termination,
plus (ii) the projected bonus payable to
Executive
in respect of the Company's full fiscal year ending immediately
following
termination plus (iii) the deemed annual value of all fringe
benefits
being made available to Executive immediately prior to
termination. For this purpose, projected bonuses shall be
determined by
assuming
that Executive qualifies for the maximum annual bonus he is
eligible
to earn. The deemed value of fringe benefits in any calendar
year
shall
equal eight percent of such year's base salary (actual or
projected
as the
case may be). Such payment shall be payable within 10 days of
the
date of
termination.
(b) If this Agreement is terminated pursuant to Section 8 hereof,
by
the
Company in breach of this Agreement following a Change in Control,
or
by
Executive pursuant to paragraph (a) or (b) of Section 7 hereof
following
a Change in
