AMENDED AND RESTATED EXECUTIVE AGREEMENTExecutive Employment Agreement |
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Exhibit 10.2
Execution
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AMENDED
AND RESTATED EXECUTIVE AGREEMENT
THIS
AMENDED AND RESTATED EXECUTIVE AGREEMENT (this “Agreement”)
is made as of March 23, 2005 (the “Effective Date”), by and
among Ziff Davis Holdings Inc., a Delaware corporation (the “Company”),
Ziff Davis Publishing Inc., a Delaware corporation and a wholly owned indirect
subsidiary of the Company (“Publishing”), and Bart Catalane
(“Executive”). The Company, Publishing and Executive are
sometimes collectively referred to herein as “Parties” and
individually as “Party”. Certain definitions are set forth
in Section 12 of this Agreement.
Executive
desires to be employed by Publishing, and Publishing desires to employ
Executive and to be assured of its right to have the benefit of
Executive’s services on the terms and conditions hereinafter set forth.
The
Parties desire to enter into this Agreement to (i) set forth the terms and
conditions of Executive’s employment with Publishing; and (ii) set
forth the obligation of Executive to refrain from competing with the Company
and its Affiliates under certain circumstances as provided herein.
To
accomplish the foregoing, the parties desire to, except as set forth in Section
14(c) hereof, amend and restate that certain Amended and Restated Executive
Agreement among the Parties dated April 30, 2002 (the “Prior
Agreement”) in its entirety effective as of the Effective Date.
NOW, THEREFORE,
the Parties hereto agree as follows:
1. Representations
and Warranties by the Company. In connection with the execution and
delivery of this Agreement, the Company represents and warrants to Executive as
of the date hereof that the execution, delivery and performance of this
Agreement have been duly and validly authorized by the Company’s board of
directors. This Agreement constitutes a valid and binding obligation of the
Company, enforceable in accordance with its terms.
2. Representations
and Warranties by Executive. In connection with the execution and delivery
of this Agreement, Executive represents and warrants to the Company that:
(a) This
Agreement constitutes the legal, valid and binding obligation of Executive,
enforceable in accordance with its terms, and the execution, delivery and
performance of this Agreement by Executive does not and shall not conflict
with, violate or cause a breach of any agreement, contract or instrument to
which Executive is a party or any judgment, order or decree to which Executive
is subject.
(b) Executive
is not a party to or bound by any employment agreement, noncompete agreement or
confidentiality agreement with any person or entity other than the Company or
Publishing.
(c) Executive
has consulted with independent legal counsel regarding his rights and
obligations under this Agreement and that he fully understands the terms and
conditions contained herein.
3. Further
Acknowledgment. Executive acknowledges and agrees that no provision
contained herein or in any other agreement or document shall entitle Executive
to remain in the employment of Publishing or any of its Affiliates.
4. Employment.
Publishing shall employ Executive, and Executive hereby agrees to continue
employment with Publishing, upon the terms and conditions set forth in this
Agreement for the period beginning on the Effective Date and ending as provided
in Section 7 hereof (the “Employment Period”).
5. Position
and Duties.
(a) During
the Employment Period, Executive shall serve as the President and Chief Operating
Officer of Publishing and shall have the normal duties, responsibilities and
authority implied by such positions. Executive shall hold similar positions
with the Company and Ziff Davis Media Inc. (“Media”) as well
as any entity controlled by the Company which the Board determines to be a key
affiliate, and Executive shall have the right to serve in the same positions
with respect to all other Affiliates controlled by the Company except to the
extent (i) the Company’s Chief Executive Officer approves the
election of another person to any such position, or (ii) applicable law
precludes Executive from holding such positions in a foreign entity, provided
that Executive shall not be entitled to any additional compensation for serving
in such positions. So long as Executive remains employed in each of such
positions with Publishing, the Company, Media and each of such key Affiliates,
Executive shall be deemed to be “Employed by the Company”
for purposes hereof, and if Executive ceases for any reason to be employed in
any of such positions with any of such entities, Executive will be deemed to be
no longer “Employed by the Company”, and his “Company
Employment” shall be deemed to have ceased or terminated. For the
avoidance of doubt, Executive will be deemed to have resigned from “Company
Employment” if Executive resigns from any of such positions with
Publishing, the Company, Media or any of such key Affiliates.
(b) Executive
shall report directly to the Chief Executive Officer of the Company and shall devote
his best efforts and substantially all of his business time and attention
(except for vacation periods contemplated hereby, periods of illness or other
incapacity, reasonable time spent with respect to civic and charitable
activities, service on the boards of directors of other companies as approved
by the Board of the Company, provided that none of such activities shall
interfere with Executive’s duties to Publishing, and other permitted
absences, if any, for which senior executive employees of Publishing are
generally eligible from time to time under Publishing’s policies) to the
business and affairs of Publishing and its Affiliates. Executive shall perform
Executive’s duties and responsibilities to the best of Executive’s
abilities in a diligent, trustworthy, businesslike and efficient manner.
6. Base
Salary; Benefits and Bonuses.
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(a) During
the Employment Period, Executive’s base salary shall be $600,000 per
annum, subject to an annual cost of living increase at the beginning of each
calendar year beginning January 1, 2005 at a rate equal to the increase in
the Consumer Price Index — All Urban Consumers for the New York area
during the prior year (but subject to a minimum annual increase of 2%), or such
higher rate as the Board of the Company may designate from time to time (the
“Base Salary”), which salary shall be payable by Publishing
in regular installments in accordance with Publishing’s general payroll
practices and shall be subject to customary withholding.
(b) In addition
to the Base Salary, during the Employment Period, Executive shall be eligible
to receive an annual bonus (the “Bonus”) as follows:
(i) with regard to each of calendar years 2005, 2006 and 2007, Executive
shall have the opportunity to earn an annual target Bonus of up to $600,000, so
long as Executive remains Employed by the Company through December 31 of
the applicable calendar year and based upon the achievement of performance
targets for the applicable calendar year determined by the Chief Executive
Officer and the Board of the Company, which targets will include both
quantitative and qualitative objectives; and (ii) Executive shall be
entitled to an additional Bonus of $600,000 so long as Executive remains
Employed by the Company through December 31, 2007 and the Company
generates consolidated EBITDA for the twelve month period ended
December 31, 2007 of at least $100,000,000. Any such Bonus, if determined
by the Board of the Company in good faith to be payable, shall be payable
within 90 days following the end of each calendar year during the
Employment Period, consistent with Publishing’s policies.
(c) During
the Employment Period, (i) Executive shall be entitled to participate in
all of Publishing’s employee benefit plans and programs for which senior
executive employees of Publishing are generally eligible, which shall include,
but shall not be limited to, health insurance, dental insurance, life
insurance, short-term and long-term disability insurance and participation in
Publishing’s 401(k) plan and (ii) Executive shall be eligible for
four (4) weeks of paid vacation in accordance with the policies of
Publishing. Executive’s right to participate in any employee benefit
plans or programs of Publishing shall be subject to Publishing’s right to
amend, modify or terminate any such plan or program in accordance with its
terms and applicable law and subject in each case to any applicable waiting
periods or other restrictions contained in such benefit plans or programs.
(d) Publishing
shall reimburse Executive for all reasonable business expenses incurred by
Executive in the course of performing Executive’s duties under this
Agreement which are consistent with Publishing’s policies in effect from
time to time for senior executive employees of Publishing with respect to
travel, entertainment and other business expenses, subject to
Publishing’s requirements with respect to reporting and documentation of
such expenses.
7. Term;
Termination; Severance.
(a) The
Employment Period commenced as of the Effective Date and shall terminate on
December 31, 2007; provided that (i) the Employment Period shall
terminate prior to such date upon Executive’s death or Incapacity;
(ii) the Employment Period may be terminated by Publishing at any time
prior to such date with Cause or without Cause; and (iii) the Employment
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Period may be terminated by Executive at any
time for Good Reason or other than for Good Reason.
(b) Upon
any Termination, Executive shall be entitled to receive Executive’s Base
Salary earned through the Termination Date, prorated on a daily basis together
with all accrued but unpaid vacation time earned by Executive during the
calendar year in which such Termination occurs and any Bonus in respect of a
prior, completed calendar year which is then due and owing and has not been
paid. Except as set forth in Section 7(d), Executive shall not be
entitled to receive Executive’s Base Salary or any bonuses or other
benefits from Publishing for any period after the Termination Date.
(c) In the
event Executive’s employment is terminated by Publishing with Cause, upon
a resignation by Executive from Company Employment other than for Good Reason,
or upon Executive’s death or Incapacity, or upon any Termination on or
after December 31, 2007, Publishing shall have no obligation to make any
severance or other similar payment to or on behalf of Executive.
(d) In the
event that Executive’s employment is terminated by Publishing without
Cause or upon a resignation by Executive from Company Employment for Good
Reason (in either case prior to December 31, 2007), following such
Termination and upon execution and delivery by Executive within 30 days
after the Termination Date of a general release in favor of the Company and its
Affiliates, in form and substance satisfactory to Publishing, Publishing shall
pay Executive his annual Base Salary (as in effect on the Termination Date) and
provide Executive health insurance benefits through the Severance Termination
Date, and, if such Termination occurs during calendar years 2005, 2006 or 2007,
pay to Executive, in the manner described in this paragraph, a bonus payment
calculated in accordance with the next two following sentences (the “Termination
Bonus Amount”). Such bonus payment would be 50% of the amount of
bonus, if any, paid by Publishing to Executive as required by this Agreement in
respect of the immediately prior calendar year or paid pursuant to the Prior
Agreement in respect of the immediately prior calendar year. In addition, if Executive’s
employment by Publishing is terminated during calendar year 2007 by Publishing
without Cause, by Executive with Good Reason or on account of Executive’s
death or Incapacity during such calendar year, and the Company generates consolidated
EBITDA for the twelve month period ended December 31, 2007 of at least
$100,000,000, the Termination Bonus Amount shall also include a $600,000
payment, which payment shall be deemed in lieu of the amount to which Executive
would have been entitled pursuant to Section 6(b)(ii) above had he
remained Employed by the Company through December 31, 2007. Each severance
payment hereunder shall be payable in accordance with Publishing’s normal
payroll procedures and cycles and shall be subject to withholding of applicable
taxes and governmental charges in accordance with federal and state law. Such
severance payments shall not be subject to reduction for any income earned by
Executive from other sources after Termination (and, consequently, Executive
shall have no duty to mitigate Publishing’s severance obligations). For
purposes hereof, “Severance Termination Date” means the
earlier of the date which is one year and six months after the Termination Date
or, so long as a Sale of the Company has not occurred prior to the Termination
Date, December 31, 2007; provided that in no event will the Severance
Termination Date be earlier than the first anniversary of the Termination Date.
The Termination Bonus Amount shall be payable in equal monthly increments over
the period from the date of determination thereof through the
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Severance Termination Date, and shall be paid
contemporaneously with payment of Base Salary during such period. After payment
of the severance amounts described in this Section 7(d), Publishing
shall have no obligation to make any further severance or other payment or
provide any other benefit to or on behalf of Executive. Notwithstanding the
foregoing, in the event that Executive shall breach any of Executive’s
obligations under any of Sections 8, 9 and 10 of this
Agreement (except any breach which Executive carries the burden of proving is
solely of a technical nature, is immaterial and was inadvertent), then, in
addition to any other rights that Publishing or the Company may have under this
Agreement or otherwise, Publishing shall be relieved from and shall have no
further obligation to pay Executive any amounts to which Executive would
otherwise be entitled pursuant to this Section 7.
8. Confidential
Information. Executive acknowledges that by reason of Executive’s
duties to and association with Publishing and its Affiliates, Executive has had
access to and will have access to and will become informed of Confidential
Information (as defined in Section 12 below) which is a competitive
asset of Publishing and/or its Affiliates. Executive agrees to keep in strict
confidence and not, directly or indirectly, make known, disclose, furnish, make
available or use, any Confidential Information, except for use in
Executive’s regular authorized duties on behalf of Publishing and its
Affiliates. Executive acknowledges that all documents and other property
including or reflecting Confidential Information furnished to Executive by
Publishing or any of its Affiliates or otherwise acquired or developed by Publishing
or any of its Affiliates or Executive or known by Executive shall at all times
be the property of Publishing and its Affiliates. Executive shall take all
necessary and appropriate steps to safeguard Confidential Information and
protect it against disclosure, misappropriation, misuse, loss and theft.
Executive shall deliver to Publishing at the termination of the Employment
Period, or at any other time Publishing may request, all memoranda, notes,
plans, records, reports, computer tapes, printouts and software and other
documents and data (and copies thereof) relating to the Confidential
Information, Work Product (as defined in Section 12 below) or the
business of Publishing or any of its Affiliates which Executive may then
possess or have under Executive’s control.
9. Inventions
and Patents.
(a) Executive
acknowledges that all Work Product is the exclusive property of Publishing.
Executive hereby assigns all right, title and interest in and to all Work
Product to Publishing. Any copyrightable works that fall within the Work
Product will be deemed “works made for hire” under Section 201(b)
of the 1976 Copyright Act, and Publishing shall own all of the rights comprised
in the copyright therein; provided, however, that to the extent
such works may not, by operation of law, constitute “works made for
hire,” Executive hereby assigns to Publishing all right, title and
interest therein.
(b) Executive
shall promptly and fully disclose all Work Product to Publishing and shall
cooperate and perform all actions reasonably requested by Publishing (whether
during or after the Employment Period) to establish, confirm and protect
Publishing’s right, title and interest in such Work Product. Without
limiting the generality of the foregoing, Executive agrees to assist
Publishing, at Publishing’s expense, to secure Publishing’s rights
in the Work Product in any and all countries, including the execution of all
applications and all other instruments and documents which Publishing shall
deem necessary in order to apply for and obtain rights in such Work Product and
in order to assign and convey to Publishing the sole and
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exclusive right, title and interest in and to
such Work Product. If Publishing is unable because of Executive’s mental
or physical incapacity or for any other reason (including Executive’s
refusal to do so after request therefor is made by Publishing) to secure
Executive’s signature to apply for or to pursue any application for any
United States or foreign patents or copyright registrations covering Work
Product belonging to or assigned to Publishing pursuant to Section 9(a)
above, then Executive hereby irrevocably designates and appoints Publishing and
its duly authorized officers and agents as Executive’s agent and
attorney-in-fact to act for and in Executive’s behalf and stead to
execute and file any such applications and to do all other lawfully permitted
acts to further the prosecution and issuance of patents or copyright
registrations thereon with the same legal force and effect as if executed by
Executive. Executive agrees not to apply for or pursue any application for any
United States or foreign patents or copyright registrations covering any Work
Product other than pursuant to this paragraph in circumstances where such
patents or copyright registrations are or have been or are required to be
assigned to Publishing.
10. Non-Compete,
Non-Solicitation.
(a) In
further consideration of the compensation to be paid to Executive hereunder and
other incentive compensation that may be granted to Executive, Executive
acknowledges that in the course of Executive’s employment with Publishing
and its Affiliates, Executive has become familiar with, and will during the
Employment Period become familiar with, Publishing’s and its Affiliates’
(and their predecessors’) trade secrets, business plans and business
strategies and with other Confidential Information concerning Publishing and
its Affiliates and that Executive’s services have been and shall be of
special, unique and extraordinary value to Publishing and its Affiliates.
Therefore, Executive agrees that, during the Employment Period and for one
(1) year thereafter (such period, the “Noncompete Period”),
Executive shall not directly or indirectly own any interest in, manage,
control, participate in (whether as an officer, director, employee, partner,
agent, representative or otherwise), consult with, render services for, or in
any other manner engage in, any of the businesses (i) of International
Data Group, Inc., CMP Media, Inc. (a subsidiary of United News & Media
PLC), or CNET Networks, Inc. (the “Restricted Persons”),
(ii) of any successor, assignee, partner, joint venture or collaboration
partner, subsidiary, division or Affiliate of any of the Restricted Persons, or
(iii) in which any of the Restricted Persons owns an interest or
participates, which any of the Restricted Persons manages or controls (whether
as an officer, director, employee, partner, agent, representative or
otherwise), or with which any of the Restricted Persons consults or to which
any of the Restricted Persons otherwise provides management or financial
support. Nothing herein shall prohibit Executive from being an owner,
indirectly through a mutual fund or other similar pooled investment vehicle, of
a passive investment in the stock of a corporation which is publicly traded, so
long as Executive has no other participation in the business of any such
corporation.
(b) During
the Employment Period and for one (1) year thereafter, Executive shall not
directly or indirectly through another Person (i) induce or attempt to
induce any employee of Publishing or any Affiliate to leave the employ of
Publishing or such Affiliate, or in any way interfere with the relationship
between Publishing or any Affiliate and any employee thereof, (ii) hire
any person who was an employee of Publishing or any Affiliate at any time
during the one year period prior to the termination of the Employment Period,
(iii) call on, solicit or service any customer, supplier, licensee,
licensor, franchisee or other business relation of Publishing or any Affiliate
in order to induce or attempt to induce such Person to cease or reduce doing
business
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with Publishing or such Affiliate, or in any
way interfere with the relationship between any such customer, supplier,
licensee or business relation and Publishing or any Affiliate, including,
without limitation, making any negative statements or communications about
Publishing or its Affiliates, or (iv) directly or indirectly acquire or attempt
to acquire any business in the United States of America to which Publishing or
any of its Affiliates has made an acquisition proposal prior to the Termination
Date relating to the possible acquisition of such business (an “Acquisition
Target”) by Publishing or any of its Affiliates, or take any action
to induce or attempt to induce any Acquisition Target to consummate any
acquisition, investment or other similar transaction with any Person other than
Publishing or any of its Affiliates.
11. Enforcement.
If, at the time of enforcement of any of Sections 8, 9 and 10
of this Agreement, a court shall hold that the duration, scope, or area
restrictions stated herein are unreasonable under circumstances then existing,
the parties hereto agree that the maximum period, scope or geographical area
reasonable under such circumstances shall be substituted for the stated period,
scope or area and that the court shall be allowed and directed to revise the
restrictions contained herein to cover the maximum period, scope and area
permitted by law. Because Executive’s services are unique and because
Executive has access to Confidential Information and Work Product, the parties
hereto agree that money damages would not be an adequate remedy for any breach
of this Agreement. Therefore, in the event a breach or threatened breach of
this Agreement, Publishing or its successors or assigns may, in addition to
other rights and remedies existing in their favor, apply to any court of
competent jurisdiction for specific performance and/or injunctive or other
relief in order to enforce, or prevent any violations of, the provisions hereof
(without posting a bond or other security). In addition, in the event of an
alleged breach or violation by Executive of Section 10, the period
set forth in such Section shall be tolled until such breach or violation has
been duly cured. Executive agrees that the restrictions contained in Section 10
are reasonable and that Executive has received consideration in exchange
therefor.
12. Definitions.
“Affiliate”
of a Person means any other person, entity or investment fund controlling,
controlled by or under common control with the Person and, in the case of a
Person which is a partnership, any partner of the Person.
“Board”
means the board of directors of the specified Person.
“Cause”
means (i) the commission by Executive of a felony or a crime involving
moral turpitude, (ii) the commission of any other act or omission by
Executive constituting fraud against the Company or any of its Subsidiaries, or
the violation of the duty of loyalty to the Company and/or its Subsidiaries
under applicable law, (iii) substantial failure by Executive to act as
reasonably directed by the Chief Executive Officer or the Board of the Company
which failure, if curable, is not cured within 15 days after notice
thereof to Executive, (iv) willful or reckless misconduct or, if curable,
gross negligence by Executive which is not cured within 15 days after
written notice thereof to Executive, with respect to the Company or any of its
Subsidiaries, or (v) any other material breach by Executive of this Agreement
or company policy established by the Chief Executive Officer or the Board of
the Company, which breach, if curable, is not cured within 15 days after
written notice thereof to Executive.
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“Confidential
Information” means all information of a confidential or proprietary
nature (whether or not specifically labeled or identified as
“confidential”), in any form or medium, that is or was disclosed
to, or developed or learned by, Executive in connection with Executive’s
relationship with the Company or any of its Affiliates prior to the date hereof
or during the Employment Period and that relates to the business, products,
services, financing, research or development of the Company or any of its
Affiliates or their respective suppliers, distributors or customers.
Confidential Information includes, but is not limited to, the following:
(i) internal business information (including information relating to
strategic and staffing plans and practices, business, training, marketing,
promotional and sales plans and practices, cost, rate and pricing structures,
accounting and business methods); (ii) identities of, individual requirements
of, specific contractual arrangements with, and information about, any of the
Company’s or any of its Affiliates’ suppliers, distributors and
customers and their confidential information; (iii) trade secrets,
know-how, compilations of data and analyses, techniques, systems, formulae,
research, records, reports, manuals, documentation, models, data and data bases
relating thereto; (iv) inventions, innovations, improvements,
developments, methods, designs, analyses, drawings, reports and all similar or
related information (whether or not patentable); and (v) Acquisition
Targets and potential acquisition candidates. Confidential Information shall
not include information that Executive can demonstrate: (a) is or becomes
publicly known through no wrongful act or breach of obligation of
confidentiality; (b) was rightfully received by Executive from a third
party (other than ZD, Inc. or any of its successors or Affiliates) without a
breach of any obligation of confidentiality by such third party; (c) was
known to Executive prior to his employment with Publishing and its Affiliates,
or (d) is required to be disclosed pursuant to any applicable law or court
order; provided, however, that Executive provides Publishing with
prior written notice of the requirement for disclosure that details the
Confidential Information to be disclosed and cooperates with Publishing to
preserve the confidentiality of such information to the extent possible.
“EBITDA” for any year means the consolidated net income of the Company and its Subsidiaries for such year plus, to the extent deducted in determining such net income, interest expense, provisions for taxes, depreciation and amortization, calculated before extraordinary gains and losses, treating as an expense all bonuses contemplated hereby (other than the bonus payable pursuant to Section 6(b)(ii) above) or under similar arrangements (whether paid in cash or otherwise payable) with other employees of the Company and its Subsidiaries and without reduction for any charge in respect of any option






