UNITEL VIDEO, INC.
555 WEST 57TH STREET
NEW YORK, NEW YORK 10019
December 8, 1997
Mr. Thomas Eyring
90 Orchard Street
Plainview, NY 11803
Dear Mr. Eyring:
In recognition of the value of your services to Unitel Video, Inc.
(the "Company"), the Board of Directors of the Company has determined that,
subject to the terms and conditions of this agreement (the "Agreement"), you
shall be entitled to receive the severance benefits set forth below in this
Agreement in the event your employment terminates under certain circumstances
in connection with a "Change in Control" (as defined below) of the Company.
This Agreement shall commence on the date hereof and, subject to the
next succeeding sentence of this paragraph, shall continue through December
31, 1998; provided, however, that commencing on January 1, 1999 and on each
January 1 thereafter, the term of this Agreement shall automatically be
extended for one additional year unless, not later than the October 1
immediately preceding any such January 1, the Company shall have given notice
to you that it does not wish to extend this Agreement; and further, provided,
that if a Change of Control shall have occurred during the original or
extended term of this Agreement, this Agreement shall continue in effect for
a period through the day immediately preceding the one-year anniversary date
of the occurrence of such Change of Control, but shall not thereafter be
further extended. Notwithstanding the foregoing, in the event that at any
time either (i) you shall terminate your employment with the Company for any
reason whatsoever, or (ii) the Company shall terminate your employment for
any reason whatsoever, in each case other than in the circumstances set forth
in the next succeeding paragraph, this Agreement shall terminate and shall be
of no further force or effect (other than with respect to those provisions
that, by their terms, expressly survive the termination of this Agreement).
If, during the period beginning upon the occurrence of a Change in
Control and ending on the day immediately preceding the one-year anniversary
date thereof, your employment is terminated (i) by the Company without
"Cause" (as defined below), or (ii) by you as a result of a substantial
diminution of your duties or responsibilities in effect prior to such Change
of Control, or a reduction in the base salary compensation theretofore
provided to you by the Company, then the Company shall pay to you, without
regard to any applicable principles of mitigation of damages or set off
(except as expressly hereinafter provided), an amount equal to one-half of
your annual base salary as in effect immediately prior to your termination
(or, if greater, immediately prior to the Change in Control). Such amount
shall be paid to you in six monthly installments, each as nearly equal in
amount as possible, commencing on the first day of the month immediately
subsequent to the date on which your employment shall be so terminated and
ending on the first day of the sixth month thereafter (the "Last Payment
Date") (the period commencing on the date of such termination of employment
and ending on the Last Payment Date is hereinafter referred to as the
"Severance Period").
You acknowledge that, as a result of your employment, you are in a
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confidential relationship with the Company and have access to confidential
information and trade secrets of the Company, its subsidiaries and affiliates
(collectively, the "Confidential Information"). Accordingly, during your
employment and thereafter, you agree to maintain in the strictest confidence
all Confidential Information and shall not use or permit the use of, or
disclose, discuss, communicate or transmit or permit the disclosure,
discussion, communication or transmission of, any Confidential Information.
This paragraph shall not apply to (i) information that, by means other than
your deliberate or inadvertent disclosure, becomes generally known to the
public, or (ii) information the disclosure of which is compelled by law
(including judicial or administrative proceedings and legal process). In
that connection, if you are requested or required (by oral question,
interrogatories, requests for information or documents, subpoenas, civil
investigative demand or other legal process) to disclose any Confidential
Information, you agree to provide the Company with prompt written notice of
such request or requirement so that the Company may seek an appropriate
protective order or relief therefrom or may waive the requirements of this
paragraph. If, failing the entry of a protective order or the receipt of a
waiver hereunder, you are compelled to disclose Confidential Information
under penalty of liability for contempt or other censure or penalty, you may
disclose such Confidential Information to the extent so required. For
purposes hereof, "Confidential Information" includes, but is not limited to,
customer and client lists, financial information, price lists, marketing and
sales strategies and procedures, computer programs, databases and software,
supplier, vendor and service information, personnel information, operating
procedures and techniques, business plans and systems, and all other records,
files, and information in respect of the Company. The provisions of this
paragraph shall survive the termination of this Agreement.
In addition, during the Severance Period you will not directly or
indirectly (i) solicit, induce or entice for employment, retention or
affiliation, or recommend to any corporation, entity or other person the
solicitation, inducement or enticement for employment, retention or
affiliation of, any employee of the Company, or any of its subsidiaries or
affiliates, or (ii) engage in any activity intended to terminate, disrupt or
interfere with the Company's or any of its subsidiaries' relationship with
any customer, supplier, lessor or other person.
In the event of the breach or a threatened breach by you of any of
two immediately preceding paragraphs, the Company's obligation to make the
payments described in this Agreement shall automatically terminate. In
addition, the Company shall be entitled to an injunction to be issued by any
court or tribunal of competent jurisdiction to restrain you from committing
or continuing any such violation without posting a bond or other security.
In any proceeding for an injunction, you agree that your ability to answer in
damages shall not be a bar or be interposed as a defense to the granting of a
temporary or permanent injunction against you. You acknowledge that the
Company will not have an adequate remedy at law in the event of any breach by
you as aforesaid and that the Company may suffer irreparable damage and
injury in the event of such a breach by you. Nothing contained herein shall
be construed as prohibiting the Company from pursuing any other remedy or
remedies available to the Company in respect of such breach or threatened
breach. The provisions of this paragraph shall survive the termination of
this Agreement.
If any term or provision of this Agreement shall be held invalid or
unenforceable because of its duration, geographic scope, or for any other
reason, the Company and you agree that the court making such determination
shall have the power to modify such provision, whether by limiting the
geographic scope, reducing the duration, or otherwise, to the minimum extent
necessary to make such term or provision valid and enforceable, and such term
or provision shall be enforceable in such modified form. The provisions of
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this paragraph shall survive the termination of this Agreement.
For purposes of this Agreement:
(a) "Change in Control" shall mean the occurrence of any of the
following: (i) the direct or indirect sale, lease, exchange or other transfer
of all or substantially all of the assets of the Company to any "person" or
"group" (as such terms are used in Sections 13(d)(3) and 14(d)(2) of the
Securities and Exchange Act of 1934, as amended (the "Exchange Act")); (ii)
the merger or consolidation of the Company with or into another corporation
with the effect that the then existing stockholders of the Company hold less
than 80% of the combined voting power of the then outstanding securities of
the surviving corporation of such merger or the corporation resulting from
such consolidation having the right to vote in the election of directors;
(iii) the replacement of a majority of the Board of Directors of the Company
(the "Board of Directors") over a two-year period from the directors who
constituted the Board of Directors at the beginning of such period, and such
replacement shall not have been approved by the Board of Directors as
constituted at the beginning of such period; (iv) a "person" or "group" (as
defined above), other than an employee stock ownership plan of the Company,
as a result of a tender or exchange offer, open market purchases, privately
negotiated purchases or otherwise, shall have become the beneficial owner
(within the meaning of Rule 13d-3 under the Exchange Act) of securities of
the Company representing 30% or more of the combined voting power of the then
outstanding securities of the Company having the right to vote in the
election of directors; or (v) the adoption by the Board of Directors and
approval by the Company's shareholders of a plan of liquidation or
dissolution of the Company.
(b) "Cause" shall mean (i) your conviction of a felony involving
moral turpitude or your conviction of any crime involving dishonesty, theft,
fraud or unethical business conduct with respect to the Company or any of its
subsidiaries; (ii) substantial and repeated failure, which is not cured
within 15 days after written notice thereof to you, to perform duties and
responsibilities as reasonably and lawfully directed in good faith by the
Board of Directors; provided, that such duties and responsibilities are
consistent with your duties and responsibilities with the Company immediately
prior to such Change of Control; or (iii) any breach of the provisions of any
employment agreement, non-competition or confidentiality agreement applicable
to you which is not remedied within any cure period that may be set forth in
any such agreement (or, if no such cure period shall be set forth in any such
agreement, within 15 days after written notice thereof to you), in each case
as determined in the good faith judgment of the Board of Directors.
This Agreement is not, and shall not be construed, as an employment
agreement or arrangement between the Company, or any other entity or person,
and you, and nothing herein shall confer on you any right to continue in the
employ of the Company, or any other entity or person, or interfere in any way
with the right of the Company, or any other entity or person, to terminate
your employment for any reason whatsoever without liability therefor except
as expressly provided in this Agreement.
This Agreement shall be binding upon and shall inure to the benefit
of the Company and its successors and assigns (including, without limitation,
any entity or person who shall acquire all or substantially all of the
businesses or assets of the Company and its subsidiaries, whether by
purchase, merger, consolidation or otherwise) and you and your heirs, legal
representatives, executors and assigns; provided, that you may not assign
this Agreement without the prior written consent of the Company.
This Agreement sets forth the entire agreement and understanding of
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the parties relating to the subject matter hereof, and supersedes all prior
agreements, arrangements and understandings, written or oral, relating to the
subject matter hereof.
This Agreement may be amended, modified, superseded, canceled,
renewed or extended, and the terms or covenants hereof may be waived, only by
a written instrument executed by both parties hereto. The failure of either
party at any time or times to require performance of any provision hereof
shall in no manner affect such party's right at a later time to enforce the
same. No waiver by either party of the breach of any term or covenant
contained in this Agreement, whether by conduct or otherwise, in any one or
more instances, shall be deemed to be, or construed as a further or
continuing waiver of any such breach or waiver of the breach of any term or
covenant contained in this Agreement.
This Agreement will be governed by, and construed and enforced in
accordance with, the laws of the State of New York applicable to agreements
made and to be performed entirely within such State.
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Please signify your agreement to the foregoing by signing this
Agreement below and returning it to the Company.
Very truly yours,
UNITEL VIDEO, INC.
By:/s/ Barry Knepper
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Name: Barry Knepper
Title: Chief Executive Officer
AGREED:
/s/ Thomas Eyring
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Thomas Eyring
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