Exhibit 10(B)
EXECUTION COPY
EMPLOYMENT AGREEMENT
THIS AGREEMENT, dated as of March 20, 1997, by and
between UNITEL VIDEO, INC., a Delaware corporation (herein
"Employer") and MARK MILLER, an individual residing at 55
Flintlock Lane, Bell Canyon, California 91307 (herein
"Employee").
W I T N E S S E T H :
WHEREAS, it is currently contemplated that Editel Los
Angeles and Unitel/ Hollywood, both divisions of Employer,
shall be merged (the new entity consisting of the merged
divisions of Editel Los Angeles and Unitel/ Hollywood being
hereinafter referred to as the "Merged Division"); and
WHEREAS, Employer desires that Employee perform certain
duties and have certain responsibilities for both
Unitel/Hollywood and the Merged Division and Employee
accepts such duties and responsibilities in accordance with
the terms of this Agreement;
NOW THEREFORE, in consideration of the premises and the
agreements herein contained, Employer and Employee agree as
follows:
Section 1. Employment.
A. Employee shall perform such duties and exercise
such powers on behalf of Employer and have such
responsibilities as are consistent with the position of (1)
for so long as Unitel/Hollywood is in existence, "President
- - Unitel/Hollywood" and (2) upon the establishment of the
Merged Division, "Chief Operating Officer of the Merged
Division" and such additional duties as shall be reasonably
designated from time to time by or at the direction of
Employer, together with any other function as might be
deemed required and necessary for the advancement of the
interests of Employer.
B. Employee shall devote his best efforts and his
time, knowledge, skill, attention and energy to the business
of Employer in the advancement of the interests of Employer.
Employee will not engage in any activities that would
interfere with his ability to discharge his responsibilities
as an employee of Employer.
C. Employer shall have the right at any time, and
from time to time, to modify the duties to be performed by
Employee, or the powers exercised by him, consistent with
the discharge of his responsibilities as President of
Unitel-Hollywood and Chief Operating Officer of the Merged
Division.
Section 2. Term of Employment.
A. Employee's employment under this Agreement shall
be for a period commencing on March 1, 1997 and ending on
February 28, 1999 (such period being, the "Employment
Period").
B. Notwithstanding the terms of paragraph A of this
section, Employee's employment is subject to termination by
Employer or Employee in accordance with the provisions of
Section 5 of this Agreement.
Section 3. Compensation.
A. In consideration for the services to be rendered
by Employee hereunder and in consideration of the covenants
herein given by Employee, Employer shall pay to Employee an
annual salary equal to (1) One Hundred Seventy Eight
Thousand Five Hundred Dollars ($178,500) (the "Base Salary")
during the period from March 1, 1997 through February 28,
1998 and (2) a percentage increase in the Base Salary equal
to the percentage increase in the Consumer Price Index, All
Urban Consumers in the Los Angeles Metropolitan Area (or its
successor index), as published by the Bureau of Labor
Statistics of the Department of Labor, from January 30, 1998
( or as near a date as is available) compared to January 30,
1997 (or the corresponding date in the prior year, as
applicable) for the period from March 1, 1998 through
February 28, 1999 (for example, if the Consumer Price Index
increases by 3% from January 30, 1997 to January 30, 1998,
Employee shall receive an annual salary equal to $183,855
during the period from March 1, 1998 through February 28,
1999), payable in accordance with Employer's usual payroll
practices, and subject to such withholdings as may be
required by law or by the terms of any applicable benefit
plan(s).
B. Provided that for the months of September 1, 1996
through the earlier of August 31, 1997 and the date that
Unitel/Hollywood ceases operation (such months being, the
"Base Period") Unitel/Hollywood achieves pre-tax net income,
Employee shall be paid bonus compensation for the Base
Period equal to five (5%) percent of the pre-tax net income
of Unitel/Hollywood for the Base Period. For all fiscal
years of Employer after August 31, 1997 and during the
Employment Period, Employee shall be paid bonus compensation
in respect of each such fiscal year equal to three (3%)
percent of the pre-tax net income of the Merged Division for
such fiscal year. Bonus compensation in respect of any
period (except the Base Period) during the Employment Period
which is shorter than a full fiscal year shall be pro rated.
Bonus compensation shall be subject to withholding as
required by law and shall be paid in accordance with
Employer's customary practices.
C. Employee shall be paid bonus compensation equal to
one percent (1%) of revenues ("Long Form Revenues"),
determined on an accrual basis, in respect of all long-form
services (such term being defined by reference to the manner
in which the customer base was divided between Editel Los
Angeles and Unitel/Hollywood in March, 1997) provided by
Editel Los Angeles, Unitel/Hollywood and the Merged Division
for the period from June 1, 1997 through May 31, 1998. For
purposes of calculating Long Form Revenues, there shall not
be included any revenues in respect of food, telephone,
messengers or any other out-of-pocket costs or any
applicable taxes. Bonus compensation shall be subject to
withholding as required by law and shall be paid in
accordance with Employer's customary practices.
D. Subject to the approval of the Board of Directors
of Unitel Video, Inc., Employee shall receive options to
purchase 10,000 shares of the common stock of Unitel Video,
Inc., exercisable as determined by the Board of Directors
pursuant to the Unitel Video, Inc. 1992 Stock Option Plan.
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E. Employee acknowledges that his responsibilities
are those of a bona fide professional, whose work is
original and creative and requires the theoretical and
practical application of highly specialized knowledge and
whose knowledge has been acquired through a prolonged course
of specialized training and experience. As such, he is
exempt from the maximum hours and minimum pay requirements
of the Fair Labor Standards Act and similar state laws.
Section 4. Benefits.
A. During the Employment Period, Employee shall be
eligible to participate in such pension, insurance, medical,
disability and other employee benefit plans of Employer
which may be in effect from time to time, to the extent his
is eligible under the terms of those plans on the same basis
as other similarly situated employees of Employer.
B. Employee shall receive five (5) weeks of vacation
during each annual period during the Employment Period,
calculated and taken in accordance with Employer policy.
Employee hereby acknowledges and agrees that as of March 1,
1997 Employee was entitled to a total of 35 accrued and
unused vacation days.
C. Employer will pay for (i) lease payments on one
automobile leased by Employee and utilized for business
purposes not to exceed a maximum of $600 per month
(including sales taxes) and (ii) the cost of insurance and
maintenance for such automobile.
Section 5. Termination.
A. Employee's employment and his rights hereunder
shall terminate on the first to occur of the following
dates:
(i) the expiration of the Employment
Period;
(ii) the date on which Employer gives
Employee written notice of
termination for cause pursuant to
subsection (B) hereof;
(iii) upon Employee's death; or
(iv) at the option of Employer, at the
expiration of the maximum period of
leave pursuant to the federal Family
Medical Leave Act (if applicable to
Employee) or 60 days after the onset
of the Employee's disability, whichever
is later.
B. Should Employee (in the reasonable opinion of
Employer, which shall not be conclusive on Employee for
purposes of exercising his rights set forth in the last
sentence of this subsection B) (i) fail, neglect or refuse
(other than by reason of mental or physical disability) to
perform or observe any or all of his obligations hereunder
at the time and in the manner herein provided; (ii) commit
an act of dishonesty, gross negligence or willful
misconduct, including, without limitation, fraud or
embezzlement; (iii) make or be found to have made any
false representation or warranty herein; (iv) be in breach
of any material covenant or other obligation contained in
this Agreement; (v) be convicted of a felony or any crime
involving moral turpitude; or
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(vi) be found to be in possession or under the influence
of illegal drugs, Employer may upon written notice, at
its option, terminate this Agreement, and thereupon be
released and discharged from all further obligations
provided for herein, but such termination shall not
affect any liability of Employee to Employer for any loss
or damages to Employer caused by, or arising out of, the
conduct of Employee resulting in his termination under
this subsection (B). Notwithstanding the above but
without limiting Employer's rights in any manner,
Employee shall be free to contest the validity and
reasonableness of Employer's determination regarding any
termination for cause, and in the event such
determination and/or termination is found to be
unreasonable or in bad faith, Employer's obligations
under this Agreement will not be terminated nor
discharged.
C. At any time after January 1, 1998, Employee shall
be entitled to terminate his employment hereunder in the
event that he is unable in good faith to work together with
Mr. Al Walton, President and Chief Executive Officer of the
Merged Division; provided that Employee notifies Employer
subsequent to the aforementioned date and gives Employer
thirty days to endeavor to settle any disagreements between
the two individuals. If at the end of such thirty-day period
a settlement has not been reached, Employee may upon written
notice terminte his employment hereunder and be entitled to
severance in an amount equal to one week of his then current
salary for each year of employment with Employer.
Section 6. Non-Disclosure Covenant;
Ownership of Proceeds of Employment
A. Employee shall not, at any time during the term of
this Agreement or thereafter, except in the performance of
his duties hereunder, communicate or disclose to any person,
or use for his own account, without the prior written
consent of Employer, any knowledge or information concerning
any patents, inventions or equipment used in, or any secret
or confidential information (including, without limitation,
any customer lists or trade secrets) acquired by Employee by
reason of his employment hereunder concerning the business
and affairs of Employer or any of its affiliates. Employee
shall retain all such proprietary and confidential
information in trust for the sole benefit of Employer and
its successors and assigns.
B. Employer shall be the sole owner of all the fruits
and proceeds of Employee's services hereunder all of which
Employee will promptly disclose to Employer, including, but
not limited to, all formats, suggestions, developments,
arrangements, designs, packages, programs, promotions and
other intellectual properties which Employee may create in
connection with and during the Employment Period, free and
clear of any claims by Employee (or anyone claiming through
or under him) of any kind or character (other than his right
to compensation hereunder). All copyrightable works created
by Employee and covered by this paragraph shall be deemed to
be Works for Hire. Employee shall, at the request of
Employer, execute such assignments, certificates or other
instruments as Employer may from time to time deem necessary
or desirable to evidence, establish, maintain, perfect,
protect, enforce or defend its right, title or interest in
or to any such properties. If employee is unable or
unwilling to perform such acts, Employee hereby appoints
Employer his attorney-in-fact with full power and authority
to execute any and all documents and take such other action
as is necessary to accomplish the foregoing.
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C. All memoranda, notes, records, and other documents
made or compiled by Employee, or made available to him
during his employment by Employer, concerning the business
of Employer, shall be Employer's property and shall be
delivered to Employer on the termination of this Agreement
or at any other time on request.
Section 7. Covenants not to Compete;
Non-Interference.
A Except in the course of his employment or upon
the prior written consent of Employer, Employee shall not at
any time during the Employment Period ( i ) render services
or advice, for compensation or otherwise, to any other
person or entity as an employee, consultant or independent
contractor or otherwise; or ( ii ) enter into any other
business affiliation, including, without limitation, the
establishment of a proprietorship or the participation in a
partnership or joint venture. Notwithstanding the foregoing,
Employer hereby gives its consent to Employee's
participation solely in an advisory capacity as a consultant
in the business of Electric Film Center provided that the
amount of time spent by Employee in such advisory role is di
minimis and does not otherwise interfere with the
performance of his obligations hereunder as determined by
Employer and provided further that Employee shall not
represent that Employer is involved in any manner in the
business or operation of Electric Film Center. In the event
that Employer determines that Employee's participation in
the business of Electric Film Center is excessive and/or
interferes with the performance of his duties hereunder,
Employee shall cease or modify his participation in the
business of Electric Film Center, as requested by Employer.
B. Employee shall not, at any time during the
Employment Period and for six (6) months after termination
pursuant to Section 5, for compensation or otherwise, acting
alone or in conjunction with others, directly or indirectly,
as a stockholder, investor, officer or director of a
corporation in which he possesses, directly or indirectly,
the power to direct or cause the direction of management or
policies (including without limitation a 10% or more holder
of the voting securities of a corporation), or as sole
proprietor or member of a partnership in all cases:
(i) for his own account or for the account
of any other person, engage, hire, employ or solicit the
employment of any person who is then or has been, within
three (3) months prior thereto, an officer, manager or
employee of Employer, whether or not such person would
commit a breach of his or her contract of employment by
reason of leaving the services of Employer; or
(ii) take advantage of any corporate
opportunity of Employer.
C. The restrictions contained in this section are
considered reasonable by the parties and it is the intent of
the parties that such restrictions and the other provisions
of this Section be enforced to the fullest extent
permissible under the laws and the public policies applied
in each jurisdiction in which enforcement is sought.
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Section 8. Compliance With Other Agreements.
Employee represents and warrants to Employer that
( i ) he is legally free to make and perform this Agreement;
and ( ii ) he has no obligation to any other person or
entity that would or will affect or conflict with any of
his obligations hereunder.
Section 9. Full and Complete Agreement; Amendment.
This Agreement constitutes the full and complete
understanding and agreement of the parties and supersedes
all prior understandings and agreements regarding Employee's
employment by Employer. This Agreement may be modified only
by a written instrument executed by both parties.
Section 10. Waiver.
No waiver by either party of any failure or
refusal to comply with its or his obligations shall be
deemed a waiver of any other or subsequent failure or
refusal to so comply.
Section 11. Partial Invalidity.
If any term or provision of this Agreement or the
application thereof to any person or circumstances shall, to
any extent, be invalid or unenforceable, the remainder of
this Agreement, or the application of such term or provision
to persons or circumstances other than those as to which it
is held invalid or unenforceable shall not be affected
thereby, and each term and provision of this Agreement shall
be valid and enforceable to the fullest extent permitted by
law.
Section 12. Successors and Assigns.
This Agreement shall inure to the benefit of, and
shall be binding upon, the parties hereto and their
respective successors, assigns, heirs, and legal
representatives, including any person or entity with which
Employer may merge or consolidate or to which it may
transfer all or substantially all of its assts. With
respect to Employee, this Agreement, being personal, cannot
be assigned.
Section 13. Authorizations.
Employer warrants and represents that the person
executing this Agreement on behalf of Employer has full
right and authority to bind Employer corporation, and was
and is authorized in every manner and respect to enter into
this Agreement.
Section 14. Attorney's Fees/Costs
In the event of any dispute, action or proceeding
under or arising out of this Agreement, the prevailing party
shall be entitled to reasonable attorney's fees and costs.
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Section 15. Notices.
All notices and other communications which are
required or may be given under this Agreement shall be in
writing and shall be deemed to have been duly given when
delivered in person or transmitted by facsimile, or five (5)
days after being mailed by registered or certified first
class mail, postage prepaid, return receipt requested, in
the case of Employer, to its President at 515 West 57th
Street, New York, New York 10019 with a copy to Karen C.
Lapidus, Esq., General Counsel, at 515 West 57th Street, New
York, New York 10019 and, in the case of Employee, to 55
Flintlock Lane, Bell Canyon, California 91307 or to
Employee at his last known address, with a copy to Howard S.
Hornreich, Esq., attorney for Employee, 23101 144th Avenue
S.E., Kent, Washington 98042, or to such other address as
such party shall have specified by notice to the other party
hereto.
Section 16. Jurisdiction.
This Agreement shall be governed by and construed
in accordance with the laws of the State of New York
(without regard to the principles of conflicts of laws), the
principal place of business of Employer. The parties agree
that the courts of the State of New York and of the State of
California shall have exclusive jurisdiction over all
matters of this Agreement and either party may bring suit
in either of such jurisdictions. The venue of such action
shall be in New York County or Los Angeles County, as
applicable.
Section 17. Effectiveness.
Although dated the above date for convenience,
this Agreement shall govern the employment relationship
between the parties for the entire Employment Period.
IN WITNESS WHEREOF, the parties hereto have duly
executed this Agreement as of the date first set forth
above.
UNITEL VIDEO, INC. MARK MILLER
By: /s/ Barry Knepper By: /s/ Mark Miller
Title: Chief Executive Officer Title: President
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