Exhibit 10.23

 

EXECUTION COPY

 

 

EMPLOYMENT AGREEMENT

This Employment Agreement (the “Agreement”) is made effective this 16th day of
December, 2015 (the “Effective Date”) by and between Michael George
(“Executive”) and QVC, Inc., a Delaware corporation (“QVC”).

In consideration of the mutual promises contained herein and for other good and
valuable consideration, the receipt and adequacy of which are acknowledged, the
parties, intending to be legally bound hereby, agree as follows:

1. Duties and Responsibilities. 

A. Title, Duties and Reporting.  Executive will be employed as President and
Chief Executive Officer of QVC.  Executive will perform the duties and services
of those positions, as well as performing any other duties and services
consistent with those positions as QVC may reasonably request.  Executive shall
at all times be subject to (i) during such time as Liberty Interactive
Corporation (“Liberty Interactive”) is the ultimate parent entity of QVC, the
supervision and control of the Chairman or Chief Executive Officer of Liberty
Interactive as the Board of Directors of Liberty Interactive (the “LIC Board”)
may designate, or (ii) during such time as Liberty Interactive is not the
ultimate parent entity of QVC, the supervision and control of the governing body
of the person that is then the ultimate parent entity of QVC or such executive
officer of the new ultimate parent entity as such entity may designate, or (iii)
if QVC is itself a publicly-traded company or has no ultimate parent entity, the
supervision and control of the board of directors of QVC. 

B. Time and Effort.  Executive shall devote substantially all of Executive’s
business time, attention and energy to the performance of Executive’s duties and
to the promotion of the business and interests of QVC and its affiliated
companies. Executive shall also adhere to QVC’s general employee
policies.  Nothing herein shall preclude Executive from (a) serving on the
boards of directors of public or private corporations with the approval of the
CEO of Liberty Interactive (which approval shall not be unreasonably withheld),
(b) serving on the boards of a reasonable number of trade associations and/or
charitable organizations, (c) engaging in charitable activities and community
affairs, and (d) managing his personal investments and affairs, provided that
such activities do not conflict or materially interfere with the effective
discharge of his duties and responsibilities under this Section l.

C. Board Position.  Executive will continue to serve as a member of the LIC
Board immediately following the Effective Date.  It is anticipated that during
the Term, Liberty Interactive will nominate and recommend to the stockholders of
Liberty Interactive that Executive be elected to the LIC Board whenever
Executive is scheduled to stand or stands for reelection to the LIC Board at any
of Liberty Interactive’s annual stockholder meetings during

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the Term.  Upon termination of the Executive’s employment by QVC for any reason
or voluntarily by Executive for any reason, Executive will promptly resign from
the LIC Board unless otherwise requested by Liberty Interactive.

2. Term.  The term of this Agreement shall commence on the Effective Date and
end on December 31, 2020, unless this Agreement is sooner terminated in
accordance with Section 8 (“Term”).

3. Compensation.

A. Base Compensation.  For all services Executive renders to QVC and its
affiliated companies, QVC will pay Executive an annual salary at the rate of One
Million Two Hundred Fifty Thousand Dollars ($1,250,000) (as may be increased
from time to time, “Base Compensation”), which Base Compensation shall be paid
in accordance with QVC’s customary payroll practices. 

B. Bonus Compensation.  Executive will be eligible to receive an annual cash
bonus (the “Bonus”).  Executive’s target bonus each year during the Term will
equal 100% of Executive’s base salary for the year, subject to satisfaction of
the criteria established for such bonus as described below.  The Bonus will be
determined by the Compensation Committee of the LIC Board (the “Compensation
Committee’) in its sole discretion and will be (i) based on such criteria as are
approved in advance by the Compensation Committee, and (ii) designed in a manner
such that the Bonus will be treated as “qualified performance-based
compensation” within the meaning of Section 162(m).  For the avoidance of doubt,
Executive’s bonus for calendar year 2015 will be determined in accordance with
the terms of Executive’s employment agreement that was in effect as of January
1, 2015.

C. Withholding.  All payments made to Executive pursuant to this Agreement,
including pursuant to this Section 3 and Section 9, will be made net of any
amounts that QVC is required to deduct or withhold pursuant to any foreign,
federal, state or local laws, rules or regulations.

D. Multiyear Option Grant. 

(i) On September 28, 2015, Executive was granted 1,680,065 options to acquire
Liberty Interactive’s Series A QVC Group Common Stock (“QVCA Common Stock”) at
an exercise price of $26.00 per share (the “Multiyear Options”).  Such grants
were made pursuant to an  award agreement in the form approved by Liberty
Interactive, which includes the applicable terms set forth in Section 9 as well
as Liberty Interactive’s other standard terms and provisions, including
forfeiture provisions related to restatement of financial statements.  Other
than the Performance RSUs described below, it is anticipated that Executive will
not receive any additional grants of options, warrants, restricted stock or
other equity or equity derivatives in QVC or Liberty Interactive or any of their
respective affiliates (“Equity Awards”) during the Term. 

(ii) The vesting period for the Multiyear Options begins on January 1, 2016 (the
“Vesting Start Date”).  The term of the Multiyear Options ends on December 31,
2022, subject to earlier termination in accordance with the terms of this
Agreement and the separate

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Non-Qualified Stock Option Agreement dated effective as of September 28, 2015
(the “Multiyear Option Agreement”).

(iii) Unless the exercisability of the Multiyear Options is accelerated pursuant
to Section 9.A., Section 9.C., or Section 9.G., and subject to Executive’s
continued employment with QVC or its affiliates in accordance with the terms of
the Multiyear Option Agreement, 50% of the Multiyear Options will become
exercisable on December 31, 2019, and 50% of the Multiyear Options will become
exercisable on December 31, 2020.

E. Annual Performance Awards.  For each of calendar years 2016, 2017, 2018, 2019
and 2020,  subject to Compensation Committee approval, Executive will be
eligible to receive from Liberty Interactive a target award of performance-based
Restricted Stock Units with respect to QVCA  Common Stock (the “Performance
RSUs”) with a value equal to at least $4,125,000 per calendar year.  Such grants
will be made within the first 90 days of each calendar year pursuant to a
Restricted Stock Unit award agreement in the form approved by Liberty
Interactive from time to time and will include the applicable terms set forth in
Section 9 as well as Liberty Interactive’s other standard terms and provisions,
including forfeiture provisions related to restatement of financial
statements.  The vesting of each grant of Performance RSUs will be subject to
the satisfaction of such performance criteria as are determined in advance each
year by the Compensation Committee and will be designed in a manner such that
the Performance RSUs will be treated as “qualified performance-based
compensation” within the meaning of Section 162(m).    Notwithstanding anything
to the contrary in this Agreement, in no event will any Performance RSUs  be
granted to Executive after the date of Executive’s termination of employment.

4. Welfare, Retirement and Fringe Benefits.  During the Term, Executive shall be
entitled to participate in the welfare, retirement and fringe benefit programs
then available to senior-level executives of QVC, including but not limited to
medical, dental, hospitalization, disability and life insurance plans,
retirement plans or programs, including, without limitation, defined benefit and
defined contribution plans, deferred compensation plans and such other plans and
programs that may be provided by QVC from time to time.

5. Restrictions. 

A. Other Work:  Except as otherwise provided in Section 1, Executive shall not
perform any work for, or render services to, any person, firm or company other
than QVC, unless done pursuant to his duties hereunder or approved in advance in
writing by QVC.

(i) Gifts/Samples:  Executive shall promptly report in writing to the General
Counsel of QVC all gifts, services or consideration Executive receives from a
third party which is connected with QVC business in any way.  The determination
as to such gifts, services or considerations shall be made in accordance with
QVC’s business conduct policies and the Liberty Interactive Code of Conduct.  In
addition, all samples which Executive receives from QVC vendors or prospective
vendors must be returned to the vendor or given to QVC after Executive has
completed Executive’s evaluation of a product, unless such sample is consumed or
otherwise depleted during the course of Executive’s evaluation.  All samples
Executive receives from QVC vendors or prospective vendors which are not (a)
given to QVC or returned to the

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vendor or (b) consumed or otherwise depleted in connection with Executive’s
evaluation of the product within ninety (90) days after Executive’s receipt of
the product must be promptly reported in writing to the General Counsel of
QVC.  QVC may return to a vendor samples it receives from Executive or QVC may
dispose of such samples as it determines in its discretion.

(ii) Confidential Information:  Executive shall not disclose to any third party
other than QVC’s subsidiaries or affiliates, nor shall Executive make use of,
confidential and proprietary business information regarding QVC which is not
generally known to the public or to the relevant trade or industry, except in
the course of performing his duties under this Agreement.  Anything herein to
the contrary notwithstanding, the provisions of this Section 5.A.(iii) will not
apply (a) if disclosure is required by law or by any court, arbitrator, mediator
or administrative or legislative body (including any committee thereof) with
apparent jurisdiction to order Executive to disclose or make available such
information, provided, however that Executive will promptly notify QVC in
writing upon receiving a request for such information and, if QVC requests,
reasonably cooperate with QVC at QVC’s expense in seeking a protective order or
other appropriate protection of such information or (b) to the extent reasonably
necessary in connection with any other litigation, arbitration or mediation
involving this Agreement, including but not limited to enforcement of this
Agreement.    Nothing in this provision or this Agreement prohibits you or your
counsel from initiating communications directly with, filing a complaint or
charge with, responding to any inquiry from, providing testimony before, or
participating in any investigations by or proceedings before the SEC, FINRA,
OSHA, or any other self-regulating organization or any other federal, state or
local administrative or regulatory authority or organization.

(iii) [Intentionally Omitted].

(iv) Non-Competition/Non-Solicitation:

(a) For purposes of this subparagraph, the following terms shall have the
meanings set forth below:

(1) The term “Direct Electronic Retailing” shall mean transmission by
television, video, radio or other electronic means (other than Internet
Retailing as defined below), through which a consumer is requested to respond by
mail, telephone, computer or other electronic means to an individual or entity
offering a retail product or service for sale; and

(2) The term “Internet Retailing” shall mean the retail marketing of goods and
services through the use of the Internet (including wired, wireless, mobile and
similar technologies), digital media or other similar means; and

(3) The term “Primary Internet Retailer” shall mean any person, firm or entity
engaged in the Internet Retailing business where fifty percent (50%) or more of
the gross revenue of such person, firm or entity (together with those of its
affiliates, in the aggregate) has been during the past year or is expected to be
during the following year directly or indirectly derived from any form of retail
marketing of goods or services by means of lnternet Retailing; and

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(4) The term “Major Retailer” shall mean any person, firm or entity (together
with its affiliates, in the aggregate) that had during the prior year or is
expected to have during the following year revenues from all sources, including
the Internet Retailing business, of more than $500,000,000; and

(5) The term “Permitted Position” shall mean an employment by or engagement for
a Major Retailer in which the responsibilities of the employment or engagement
do not relate to the direct management of Internet Retailing.

(b) In consideration of Executive’s employment by QVC pursuant to the terms of
this Agreement, Executive agrees that for so long as Executive is employed by
QVC or any of its affiliated entities (whether pursuant to this Agreement or
otherwise) and for a period of one year (or, in the case of Section
5.A.(v)(b)(1)(i), Section 5.A.(v)(b)(1)(ii)(z), Section 5.A.(v)(b)(2) and
Section 5.A.(v)(b)(3), two years) after Executive’s last day of employment with
QVC or any of its affiliated entities (whether pursuant to this Agreement or
otherwise), Executive shall not, directly or, except as specifically provided
below, indirectly:

(1) within the United States and elsewhere where QVC or any of its affiliated
entities conducts its business, (i) provide direct management services in
connection with any form of Direct Electronic Retailing or Internet Retailing or
(ii) become employed by, or render services to, any person, firm or entity which
(x) is both a Primary Internet Retailer and a Major Retailer, and/or (y) is a
Major Retailer, other than in a Permitted Position, and/or (z) is engaged in, or
about to be engaged in, the marketing of goods or services by means of Direct
Electronic Retailing and/or Internet Retailing, where more than 25% of the gross
revenue of such person, firm or entity (together with those of its affiliates,
in the aggregate) is directly or indirectly derived (or for persons, firms or
entities preparing to be engaged in the marketing of goods or services by means
of Direct Electronic Retailing and/or Internet Retailing, is expected to be
derived) from any form of Direct Electronic Retailing and/or Internet Retailing,
whether the services listed in (x), (y), and (z) above are rendered as a
principal, partner, officer, director, agent, employee, representative,
consultant, independent contractor or otherwise, without the prior written
consent of QVC; and/or

(2) induce or attempt to induce, except in the course of carrying out his duties
under this Agreement, any employee of QVC or any of its subsidiaries or
affiliates to leave the employ of QVC or any such subsidiary or affiliate;
and/or

(3) induce or attempt to induce, except in the course of carrying out his duties
under this Agreement, any person to terminate a relationship with QVC or any of
its subsidiaries or affiliates.

(v) Codes of Conduct:  Executive agrees to abide by QVC’s business conduct
policies and the Liberty Interactive Code of Conduct.

B. Executive’s obligations under this Section 5 are of a special and unique
character which gives them a peculiar value.  QVC cannot be reasonably or
adequately compensated in damages in an action at law in the event Executive
breaches such obligations.  Executive agrees that, in addition to any other
rights or remedies which QVC may possess, QVC shall be entitled

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to injunctive relief and other equitable relief to prevent a breach of this
Section 5, including but not limited to a temporary restraining order or
preliminary injunction from any court of competent jurisdiction restraining any
threatened or actual violation.  Executive waives the making of a bond as a
condition for obtaining such relief.  Such rights shall be cumulative and in
addition to any other legal or equitable rights and remedies QVC may have.

6. Reimbursement of Business-Related Expenses.  QVC shall reimburse Executive
for all reasonable and necessary out-of-pocket expenses that Executive actually
incurs in the performance of Executive’s duties, including, but not limited to,
expenses for travel and other miscellaneous business expenses; provided,
however, that Executive shall submit to QVC written itemized expense reports and
such additional substantiation QVC may reasonably request.  QVC will also
reimburse Executive for, or directly pay, the reasonable legal fees incurred by
him in connection with the negotiation and drafting of this Agreement. 

7. Proceeds of Executive’s Services/Use of Executive’s Image.  

A. Executive acknowledges and agrees that any and all proceeds of all services
provided to QVC and any and all works created or produced by Executive for QVC
(collectively referred to herein as the “Works”) are being prepared by and for,
and at the instigation and under the direction of, QVC and that the Works are
and at all times shall be regarded as “work made for hire” as that term is used
in the United States copyright laws, and that all copyrights in and to the Works
belong to QVC as “work made for hire”.  Without limiting the preceding sentence,
and by this Agreement, Executive assigns, grants and delivers, exclusively unto
QVC, its legal representatives, successors and assigns, all right, title and
interest of every kind and nature whatsoever in and to the Works, and all
copies, versions, derivatives, processes, systems, products and proceeds
thereof, or resulting therefrom, including any copyrights in any country.

B. Executive also grants QVC the use of Executive’s performances and pictures
for advertising, public displays, promotion and all other legal presentations
including, without limitation, the above-mentioned uses.  After the term of this
Agreement, QVC will not make use of Executive’s performances and pictures in a
manner in which Executive is the subject of the advertising, public displays,
promotion and other presentations except with respect to any of the foregoing
that were created during the Term.  Executive releases QVC, its successors and
assigns, from all liability to the extent resulting from the use of Executive’s
own performance or picture.

8. Termination.  

A. Executive’s employment may be terminated by QVC with or without prior notice
and with or without Cause (as defined in Section 9.B.) at any time prior to the
end of the Term.  Executive’s employment shall immediately terminate upon
Executive’s death or Disability (as defined in Section 9.A.).  During the Term,
Executive may voluntarily terminate Executive’s employment with QVC by giving
(i) 30 days’ advance written notice to QVC of Executive’s intent to so terminate
for Good Reason, and (ii) six months’ advance written notice to QVC of
Executive’s intent to so terminate other than for Good Reason or Disability. 

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B. In order for such a termination to qualify as a “Good Reason” termination
such termination must be based on one of more of the circumstances described in
the next sentence.  For purposes of this Agreement, “Good Reason” shall be an
action by QVC, (or in the case of clause (ix) of this Section 8.B, by LIC) other
than in connection with the termination of Executive’s employment by QVC for
Cause (i) that results in a material diminution or material adverse change in
Executive’s title, authority, duties or responsibilities including but not
limited to assignment to Executive of duties materially inconsistent with
Executive’s duties as described in Section 1 or that materially impair his
ability to carry out those duties; (ii) requiring Executive to be based at any
office or location other than offices of QVC in West Chester, Pennsylvania;
provided, however, that a general relocation of the offices of QVC to a location
not more than 25 miles from West Chester, Pennsylvania shall not constitute a
Good Reason; (iii) that results in a reduction in Executive’s (a) then current
Base Compensation or (b) eligibility to receive a Bonus with a target of 100% of
Base Compensation (it being acknowledged that QVC and the LIC Board have no
obligation to actually award any Bonus); (v) that would substantially diminish
the aggregate value of the benefits provided to Executive, including, but not
limited to, benefits under QVC’s medical, health, accident, disability, life
insurance, thrift and retirement and deferred compensation plans other than any
action that applies to all senior officers of QVC with respect to the benefit
plans; (vi) that results in a change in the reporting structure applicable to
Executive other than as permitted by Section 1; (vii) that results in a breach
by QVC of any material provision of this Agreement; (viii) that results in the
failure of QVC to obtain, within a reasonable period of time after Executive’s
written request, the assumption in writing of its obligation to perform this
Agreement by any successor to all or substantially all of the assets of QVC or
(ix) that results in Executive not being granted all or any part of the
Performance RSUs specified in Section 3.E.  Good Reason will not be deemed to
exist unless Executive gives QVC notice within 120 days following the occurrence
of the event which Executive believes constitutes the basis for Good Reason,
specifying the particular act or failure to act which Executive believes
constitutes the basis for Good Reason and provides QVC with a reasonable
opportunity of at least 30 days to cure such act or failure to act.

C. Subject to Section 10.B., this Agreement will terminate upon the termination
of Executive’s employment with QVC.

9. Rights Upon Termination Prior to Expiration of Term.  

A. Termination for Death or Disability. 

(i) Upon termination of Executive’s employment for Executive’s death or
Disability (as defined in clause (iv) below) prior to the expiration of the
Term, QVC shall pay Executive, or Executive’s designated beneficiary or estate,
as the case may be, (a) Executive’s then current Base Compensation in accordance
with QVC’s customary payroll practices for a period of one year after such
payments commence under this Agreement (the “Base Compensation Continuing
Payments”); (b) Executive’s Base Compensation through the date of termination;
(c) the amount of any reimbursable expenses incurred by Executive pursuant to
Section 6 prior to the date of termination but not yet reimbursed; (d) any
declared but unpaid Bonus for the calendar year prior to the year in which the
termination occurs; (e) vested benefits, if any, owed to Executive in accordance
with other applicable plans, programs and arrangements of QVC and its
affiliates; and (f) any other amounts that QVC is required pursuant to
applicable

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law to pay Executive (the amounts referenced in clauses (b), (c), (e) and (f)
are referred to in this Agreement as the “Standard Entitlements”).    Any Bonus
payable pursuant to Section 9.A(i)(d) will be paid at the time that it would
have been paid if no termination of employment had occurred. 

(ii) Upon termination of Executive’s employment for Executive’s death or
Disability on or after the Vesting Start Date but prior to the expiration of the
Term, the Multiyear Options (a) will immediately vest and become exercisable to
the extent not already vested as of the date of termination of employment, and
(b) will be exercisable throughout the remainder of the full original term of
such Equity Award (determined without reference to any provision in the
applicable award agreement that reduces the exercisability of, or limits the
vesting of, such Equity Award upon Executive’s termination of employment, but
otherwise in accordance with the terms and conditions applicable to such Equity
Award).

(iii) Upon termination of Executive’s employment for Executive’s death or
Disability, any issued and outstanding but unvested Performance RSUs will
immediately vest to the extent not already vested as of the date of termination
of employment.

(iv) For purposes of this Agreement, “Disability” means Executive’s inability to
perform his duties because of physical or mental incapacity for a period of 180
consecutive days and, within 30 days after a notice of termination is given to
Executive, Executive has not returned to work.  Notwithstanding the foregoing,
Executive will not be considered to have suffered a Disability unless he is also
“disabled” as such term is defined under Section 409A(a)(2)(C) of the Internal
Revenue Code.

(v) Except as specified in this Section 9.A., QVC will have no further liability
or obligation to Executive following a termination of Executive’s employment
prior to expiration of the Term as a result of death or Disability.

(vi) Payment of the benefits described above will be subject to the timing
requirements set forth in Section 20.

B. Termination for Cause. 

(i) Upon a termination of Executive’s employment for Cause (as defined in clause
(iv) below) prior to the expiration of the Term, QVC shall pay Executive the
Standard Entitlements.

(ii) Upon a termination of Executive’s employment for Cause prior to the
expiration of the Term (a) Executive will forfeit all rights to any Multiyear
Options then held by Executive that are not vested as of the date of termination
of Executive’s employment; and (b) any Multiyear Options that are outstanding
and vested, but unexercised, as of the date of termination of Executive’s
employment will be exercisable for a period of up to 90 days after the date of
termination (but in no event will be exercisable after the stated term of such
option or similar right).

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(iii) Upon a termination of Executive’s employment for Cause prior to the
expiration of the Term, Executive will forfeit all rights to any Performance
RSUs then held by Executive that are not vested as of the date of termination of
Executive’s employment.

(iv) “Cause” shall be (a) if Executive commits a material breach of this
Agreement, (b) if Executive commits fraud or embezzlement or other serious
misconduct against QVC or its affiliates, including, without limitation, a
serious or material violation of QVC’s business conduct policies or the Liberty
Interactive Code of Conduct, (c) the conviction of Executive of any felony under
or within the meaning of United States federal law or state law, or (d) the
conviction of Executive of a misdemeanor which conviction relates to Executive’s
suitability for employment in Executive’s then current position but excluding
any conviction for a minor traffic violation.  In no event will Executive be
terminated for Cause without (x) a reasonable opportunity for Executive to be
heard by the LIC Board, (y) a vote or written action in favor of a termination
for Cause by at least a majority of all the members of the LIC Board, and (z)
written notification to Executive of a termination for Cause.

(v) Except as specified in this Section 9.B., QVC will have no further liability
or obligation to Executive following a termination of Executive’s employment for
Cause prior to expiration of the Term.

C. Termination by Executive For Good Reason or by QVC Without Cause.

(i) Upon termination of Executive’s employment by QVC prior to the expiration of
the Term other than for death, Disability or Cause, or upon the termination of
Executive’s employment by Executive prior to the expiration of the Term for Good
Reason (collectively, a “Protected Termination”), QVC shall pay Executive (a)
the Base Compensation Continuing Payments; (b) a lump sum payment of One Million
Five Hundred Thousand Dollars ($1,500,000) (the “Severance Payment”); (c) any
declared but unpaid Bonus for the calendar year prior to the year in which the
termination occurs and (d) the Standard Entitlements.

(ii) Upon a Protected Termination that occurs on or after the Vesting Start Date
but prior to the expiration of the Term, a pro rata portion of each tranche of
the Multiyear Options that is not vested on the date of such termination will
vest as of the date of such termination, such pro rata portion to be equal to a
fraction, the numerator of which is the number of days Executive was employed by
QVC and its affiliates from the Vesting Start Date through the date of the
Protected Termination plus 365, and the denominator of which is the number of
days in the entire vesting period for such tranche of Multiyear Options  (it
being acknowledged that the vesting period for each tranche begins on the
Vesting Start Date), in no event to exceed the total number of unvested
Multiyear Options as of the date of a Protected Termination.

(iii) Upon a Protected Termination that occurs on or after the Vesting Start
Date but prior to the expiration of the Term, the exercisability of any vested
Multiyear Options, including any that vest because of a Protected Termination,
will be extended to the earlier of (a) the original expiration date of the
option (determined without reference to any provision in the applicable award
agreement that reduces the exercisability of such option upon Executive’s
termination of employment, but otherwise in accordance with the terms and
conditions applicable to such option), or (b) the date that is two years from
the date of the Protected

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Termination, or, if Executive dies prior to the expiration of such two-year
period, the close of business of the first business day following the later of
the expiration of (x) such two-year period or (y) the one-year period which
began on the date of Executive’s death (but in no event will be exercisable
after the stated term of such option or similar right).

(iv) Upon a Protected Termination during the Term, any Performance RSUs  that
are issued and outstanding but unvested as of the date of termination will
remain outstanding until the date as of which the Compensation Committee
determines whether the performance criteria applicable to such Performance RSUs
were met (such date, the “Committee Certification Date”).  To the extent the
Compensation Committee determines that Executive’s issued and outstanding but
unvested Performance RSUs would have vested if Executive had remained an
employee for the entire performance period applicable to such Equity Awards (the
number of Performance RSUs that the Compensation Committee determines would have
vested, the “Qualifying Performance RSUs”), Executive will vest as of the
Committee Certification Date in a pro rata portion of such Qualifying
Performance RSUs based on the number of days Executive was employed during the
performance period for such Qualifying Performance RSUs.

(v) Except as specified in this Section 9.C., QVC will have no further liability
or obligation to Executive following a termination of Executive’s employment
prior to expiration of the Term by Executive for Good Reason or by QVC without
Cause.

(vi) Payment of the benefits described above will be subject to the timing
requirements set forth in Section 20.

D. Voluntary Termination.

(i) Upon a voluntary termination by Executive of his employment prior to
expiration of the Term (other than a termination for Good Reason), QVC shall pay
Executive (a) the Standard Entitlements; and (b) any declared but unpaid Bonus
for the calendar year prior to the year in which the termination occurs.

(ii) Upon a voluntary termination by Executive of his employment prior to
expiration of the Term (other than a termination for Good Reason) (a) Executive
will forfeit all rights to any Multiyear Options then held by Executive that
have not become vested as of the date of termination of Executive’s employment;
and (b) any Multiyear Options that are outstanding and vested, but unexercised,
as of the date of termination of Executive’s employment will be exercisable for
a period of up to 90 days after the date of termination (but in no event will be
exercisable after the stated term of such option or similar right).

(iii) Upon a voluntary termination by Executive of his employment prior to
expiration of the Term (other than a termination for Good Reason), Executive
will forfeit all rights to any Performance RSUs then held by Executive that have
not become vested as of the date of termination of Executive’s employment.

(iv) Except as specified in this Section 9.D., QVC will have no further
liability or obligation to Executive following a voluntary termination by
Executive of his employment prior to expiration of the Term (other than a
termination for Good Reason).

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E. Termination At or Following Expiration of the Term. 

(i) Upon a termination of Executive’s employment by Executive or QVC at or
following expiration of the Term for any reason, including termination by QVC
with or without Cause, voluntary termination by Executive with or without Good
Reason, and termination by reason of death or Disability, QVC shall pay
Executive (a) the Standard Entitlements;  and (b) except in the case of
termination by QVC for Cause, any declared but unpaid Bonus for the calendar
year prior to the year in which the termination occurs.  In addition, except in
the case of termination by QVC for Cause, if Executive’s employment ends on the
last day of the Term, Executive will also be eligible to receive the Bonus he
would have received for calendar year 2020 if he had remained employed by QVC as
of the date of determination of the 2020 bonuses payable to QVC employees,
determined as described in Section 3.B. in the sole discretion of the decision
maker.  For clarity, in no event will the termination of Executive’s employment
by QVC or by Executive at the end of the Term or thereafter constitute a
termination without Cause by QVC or by Executive for Good Reason, nor will any
termination of Executive’s employment at or following expiration of the Term as
a result of Executive’s death or Disability be governed by Section 9.A.

(ii) Upon a termination of Executive’s employment by Executive or QVC at or
following expiration of the Term (including termination by reason of death or
Disability, termination by QVC with or without Cause, and voluntary termination
by Executive with or without Good Reason), any Multiyear Options then held by
Executive that are outstanding and vested, but unexercised, will be exercisable
throughout the remainder of the full original term of such Equity Award
(determined without reference to any provision in the applicable award agreement
that reduces the exercisability of, or limits the vesting of, such Equity Award
upon Executive’s termination of employment, but otherwise in accordance with the
terms and conditions applicable to such Equity Award).

(iii) Upon a termination of Executive’s employment by Executive or QVC at or
following expiration of the Term for any reason other than a termination
following expiration of the Term by reason of death or Disability or within six
months following a Change of Control of QVC (as defined in Section 9.G(iv)), any
Performance RSUs that are issued and outstanding but unvested as of the date of
termination will remain outstanding until the Committee Certification Date and
will vest on the Committee Certification Date to the extent that the
Compensation Committee determines that the performance criteria applicable to
such Equity Awards were met.  Upon a termination of Executive’s employment by
Executive or QVC following expiration of the Term by reason of death or
Disability or within six months following a Change of Control of QVC, any
Performance RSUs that are issued and outstanding but unvested as of the date of
such termination will immediately vest in full.

(iv) Except as specified in this Section 9.E., QVC will have no further
liability or obligation to Executive (or his legal representative as the case
may be) following a  termination of Executive’s employment by Executive or QVC
at or following expiration of the Term for any reason, including termination by
QVC with or without Cause, voluntary termination by Executive with or without
Good Reason, and termination by reason of death or Disability.

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F. Waiver of Payments.  Executive acknowledges and agrees that the amounts, if
any, which may be payable under this Section 9 are in lieu of and not in
addition to any severance payments which may be generally available to employees
of QVC and Executive hereby waives any right Executive may have in or to any
severance payments not contained in this Section 9.

G. Protected Termination Following a Change of Control of QVC.

(i) If within six months following a Change of Control of QVC (as defined in
clause (iv) below) that occurs on or after the Vesting Start Date and prior to
the expiration of the Term:  (a) Executive’s employment is terminated by QVC
without Cause, or (b) Executive gives notice pursuant to Section 8.A. that he is
terminating his employment for Good Reason and Executive’s employment
subsequently terminates based on such notice following expiration of QVC’s cure
period, then Executive shall be entitled to the payments specified in Section
9.C.(i) and Executive’s Equity Awards shall be impacted as described in Section
9.G.(ii).

(ii) If Section 9.G.(i) is applicable, the Multiyear Options (a) will
immediately vest and become exercisable to the extent not already vested as of
the date of such Protected Termination, and (b) will be exercisable throughout
the remainder of the full original term of such Equity Award (determined without
reference to any provision in the applicable award agreement that reduces the
exercisability of such Equity Award upon Executive’s termination of employment,
but otherwise in accordance with the terms and conditions applicable to such
Equity Award).

(iii) If Section 9.G.(i) is applicable, any issued and outstanding but unvested
Performance RSUs will immediately vest to the extent not already vested as of
the date of such Protected Termination.

(iv) For purposes of this Agreement, a “Change of Control of QVC” means (a) any
merger, consolidation, business combination, share exchange, or other
transaction, not constituting a Reorganization Event (as defined below), which
results in any person (or group as defined in Rule 13d-3), other than Liberty
Interactive or any person or entity controlling, controlled by, or under common
control with, Liberty Interactive, acquiring a majority of the combined voting
power of the outstanding capital stock of QVC ordinarily (and apart from the
rights accruing under special circumstances) having the right to vote in the
election of directors, or (b) any sale, lease, exchange or other transfer, not
constituting a Reorganization Event (in one transaction or a series of related
transactions) of all, or substantially all, of the assets of QVC and its
Subsidiaries, taken as a whole.  In no event will any Reorganization Event
constitute a Change of Control of QVC.  A “Reorganization Event” means (1) any
direct or indirect spin-off or split-off of QVC or any person or entity holding
no less than a majority of the outstanding voting power and equity of QVC, or a
majority of the assets of QVC and its Subsidiaries taken as a whole, from
Liberty Interactive or its ultimate parent at such time, however effected
(including, for example, by a redemption, pro rata distribution or an exchange
offer), or (2) any transfer of all or substantially all of the assets of QVC and
its Subsidiaries taken as a whole to Liberty Interactive or any person or entity
controlling, controlled by, or under common control with, Liberty Interactive.

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(v) Except as specified in this Section 9.G., QVC will have no further liability
or obligation to Executive following a Protected Termination that occurs within
six months following a Change of Control of QVC.

H. General Release.  If Executive’s employment hereunder is terminated pursuant
to Section 9.A., Section 9.C., Section 9.E or Section 9.G., the payment by QVC
to Executive of any Base Compensation Continuing Payments or Severance Payment
under the applicable Section, as well as any acceleration of vesting or
extension of exercise period described in the applicable Section shall be
subject to the execution and delivery to QVC by Executive (or by Executive’s
legal representative, if applicable), within the applicable time period
described below, of a severance agreement and general release (the “Release”) in
a form that is reasonably satisfactory to QVC and consistent with the form of
severance agreement and general release then used by QVC for senior executives.
 The form of Release shall be delivered to Executive on the date of termination
in the case of a termination of Executive’s employment by QVC, or as soon as
reasonably practicable following the date of termination in the case of a
termination of employment by Executive or for death or Disability.  Executive
shall have a period of 21 days (or, if required by applicable law, a period of
45 days) from Executive’s (or Executive’s legal representative, if applicable)
receipt of the form of Release (the “Consideration Period”) in which to execute
and return the original, signed Release to QVC.  If Executive delivers the
original, signed Release to QVC prior to the expiration of the Consideration
Period and does not thereafter revoke such Release within any period of time
provided for such revocation under applicable law, Executive shall, subject to
Section 9.I., be entitled to any Base Compensation Continuing Payments and
Severance Payments specified in Section 9.A., Section 9.C. or Section 9.G., as
applicable and to any acceleration of vesting or extension of exercise periods
of Equity Awards specified in such Sections or in Section 9.E., payable in
accordance with the timing requirements set forth in Section 20.  In such event,
an amount equal to one-twelfth of the aggregate Base Compensation Continuing
Payments (or, in the case of a termination pursuant to Section 9.E., the
continued exercisability of Equity Awards provided for in Section 9.E.(ii))
shall constitute consideration for Executive’s delivery of the Release pursuant
to this Section 9.H. (the “Release Consideration”).

I. Continued Compliance.  Executive and QVC hereby acknowledge that any Base
Compensation Continuing Payments or Severance Payments to be made by QVC
pursuant to Section 9.A., Section 9.C. or Section 9.G., as applicable, other
than the Release Consideration, are part of the consideration for Executive’s
undertakings under Section 5.A.(v).  Payment of such amounts by QVC is subject
to Executive’s continued compliance with the provisions of Section 5.A.(v).  If
Executive violates any provision of Section 5.A.(v), then QVC will have no
obligation to pay Executive any Base Compensation Continuing Payments or
Severance Payments pursuant to Section 9.A., 9.C. or 9.G. to the extent any or
all of the same remain payable by QVC on or after the date of such violation,
except to the extent of any unpaid Release Consideration.  In addition, to the
extent that a Severance Payment was previously made to Executive, Executive will
return a pro rata portion of such Severance Payment to QVC based on the
percentage of the time period applicable to the Section 5.A.(v) restriction that
was breached that elapsed prior to Executive breaching such restriction (e.g.,
if the restriction that was breached was to continue for one year following
Executive’s termination and six months of such restrictive time period remained
at the time Executive breached such restriction, Executive would return 50% of
the Severance Payment to QVC).

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10. Severability and Survival.  

A. Should any portion of this Agreement be held to be void, invalid or
unenforceable, such decision shall not affect the validity or enforceability of
the remainder of the Agreement, and the remaining provisions herein shall be
effective as though such invalid or unenforceable provision had not been
included herein.  If such invalidity or unenforceability is caused by the length
of any period of time, the geographic scope of any provision, or the breadth of
activities covered by any provision, then the period of time, geographic scope
or breadth of activities, or all of them, shall be reduced to the extent
necessary to cure such invalidity or unenforceability.  Section 5.A.(v) shall be
construed and enforced to the maximum extent permitted by law.

B. The provisions of Sections 5.A.(iii), 5.A.(v), 5.B., 7, 9, 15, 18 and 20
shall survive the expiration or termination of this Agreement.

11. Notices.  Any notice required or permitted to be given under this Agreement
shall be sufficient, if in writing and if delivered by hand or sent by overnight
courier service or by registered, overnight or certified mail, if to Executive,
to Executive’s last known address listed in the records of QVC, and if to QVC,
to the General Counsel, with a copy to the Chief Financial Officer at QVC’s
principal office.  Notices shall be effective upon receipt.

12. Assignment.  This Agreement is personal in its nature and neither of the
parties hereto will, without the consent of the other, assign or transfer this
Agreement or any rights or obligations hereunder; provided, however, that in the
event of a merger, consolidation, corporate restructuring or transfer or sale of
all or substantially all of the assets of QVC to any other individual(s) or
entity, this Agreement will, subject to the provisions hereof, be binding upon
and inure to the benefit of such successor and such successor shall discharge
and perform all the promises, covenants, duties, and obligations of QVC
hereunder, and promptly after a request by Executive, such transferee or
successor shall be required to assume such obligations by contract (unless such
assumption occurs by operation of law).  No rights or obligations of Executive
under this Agreement may be assigned or transferred by Executive, without QVC’s
prior written consent, other than his rights to compensation and benefits, which
may be transferred only by will or operation of law; provided, however, that to
the extent Executive is permitted to do so under any applicable plan, policy,
program, agreement, or other arrangement with QVC or any of its affiliates,
Executive shall be entitled to select and change a beneficiary or beneficiaries
designated by Executive to receive any compensation, entitlement or benefit
payable thereunder following Executive’s death by his giving QVC written notice
thereof.

13. Waiver.  Neither the failure nor any delay on the part of a party to
exercise any right, remedy, power or privilege under this Agreement will operate
as a waiver thereof, nor will any single or partial exercise of any right,
remedy, power or privilege preclude any other or further exercise of the same or
of any other right, remedy, power or privilege, nor will any waiver of any
right, remedy, power or privilege with respect to any occurrence be construed as
a waiver of such right, remedy, power or privilege with respect to any other
occurrence.  No waiver will be effective unless it is in writing and is signed
by the party asserted to have granted such waiver.

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14. Headings/Section References.  The paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement or give full notice thereof.  Unless
otherwise specified, all Section references in this Agreement are to the
applicable Section of this Agreement.

15. Applicable Law.  This Agreement shall be interpreted and construed under the
internal laws of the Commonwealth of Pennsylvania exclusive of choice of laws
principles and Executive and QVC hereby consent to the exclusive jurisdiction of
the state courts of the Commonwealth of Pennsylvania,  Chester County and the
United States Federal Courts for the Eastern District of Pennsylvania in all
matters arising hereunder.  By execution and delivery of this Agreement, each of
the parties irrevocably waives any objection, including any objection to the
laying of venue or based on the grounds of forum non conveniens or lack of
personal jurisdiction, which it may now or hereafter have to the bringing of any
action or proceeding in such courts in respect of this Agreement or the matters
contemplated hereby.

16. Entire Agreement.  This Agreement contains the entire agreement of the
parties with respect to the subject matter hereof and supersedes any and all
prior written agreements and prior or contemporaneous oral agreements with
respect to the subject matter hereof; provided, however, that the provisions of
the Employment Agreement dated as of May 3, 2011 between QVC and Executive, as
amended, that have obligations that have not been fully performed or that by
their nature would be intended to survive the expiration of such agreement shall
remain in full force and effect and shall not be superseded by this Agreement. 
This Agreement shall not be changed or altered, except by an agreement in
writing signed by the party against whom enforcement of any waiver, change,
modification, extension or discharge is sought.  In the event of any
inconsistency between the terms of this Agreement and the terms of any other QVC
plan, policy, arrangement or agreement with Executive, the provisions of this
Agreement will govern.

17. No Restrictions on Employment; Contingency.  

A. Representations and Warranties.  To induce QVC to enter into this Agreement,
Executive represents, warrants and covenants to QVC as follows:

(1) Executive has the full and complete ability and authority to enter into this
Agreement and render services pursuant hereto and Executive is not subject to
any legal, contractual or other restriction on Executive’s employment which
would impair or otherwise restrict Executive’s ability to perform the services
to QVC hereunder; and

(2) Executive has not disclosed to QVC any confidential information or trade
secrets of any third party, nor will Executive disclose to QVC any confidential
information or trade secrets of a third party where such disclosure would
violate the terms of any agreement or otherwise breach any duty Executive may
have to any such third party.

B. Indemnity.  Executive shall indemnify, defend and hold harmless QVC, its
successors and assigns, upon demand, from and against any loss, liability,
damage or expense (including reasonable attorneys’ fees) which QVC may sustain
or incur by reason of the breach of his representations, warranties or covenants
in Section 17.A.

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18. Indemnification of Executive.  

A. During the Term and thereafter, QVC agrees to indemnify and hold Executive
and his heirs and representatives harmless, to the fullest extent permitted
under QVC’s Certificate of Incorporation and bylaws or, if greater, under
applicable law, against any and all damages, costs, liabilities, losses and
expenses (including reasonable attorneys’ fees) as a result of any claim or
proceeding, or threatened claim or proceeding, against Executive that arises out
of or relates to his service as an officer, director or employee, as the case
may be, of QVC, or his service in any such capacity or similar capacity with an
affiliate of QVC or other entity at the request of QVC, both prior to and after
the Effective Date, and to advance to Executive or his heirs or representatives
such expenses upon written request.  In the event QVC advances any expenses to
Executive pursuant to this Section 18 and it is subsequently determined by a
court of competent jurisdiction that Executive is not entitled to
indemnification by QVC, Executive shall promptly refund all amounts advanced to
Executive by QVC.

B. To the extent QVC maintains a policy of directors’ and officers’ liability
insurance during the Term, then QVC shall provide Executive with coverage under
such policy on a basis no less favorable than that applying to any other then
current or former director or officer.

19. QVC’s Representations.  QVC represents and warrants that (i) the execution,
delivery and performance of this Agreement by QVC has been fully and validly
authorized by all necessary corporate action, (ii) the officer signing this
Agreement on behalf of QVC is duly authorized to do so, (iii) the execution,
delivery and performance of this Agreement does not violate any applicable law,
regulation, order, judgment or decree or any agreement, plan or corporate
governance document to which QVC is a party or by which it is bound and (iv)
upon execution and delivery of this Agreement by the parties hereto, it will be
a valid and binding obligation of QVC enforceable against it in accordance with
its terms, except to the extent that enforceability may be limited by applicable
bankruptcy, insolvency or similar laws affecting the enforcement of creditors’
rights generally.

20. Compliance with 409A. 

A. The provisions of this Agreement are intended to meet the requirements of
Section 409A of the Internal Revenue Code, any Treasury regulations promulgated
thereunder and any guidance issued by the Internal Revenue Service relating
thereto (collectively, “Section 409A”), and will be interpreted in a manner that
is consistent with such intent.  The parties intend that, to the maximum extent
possible, any amounts paid as Base Compensation Continuing Payments or Severance
Payments or otherwise shall qualify as a short-term deferral pursuant to Section
409A or as separation pay exempt from Section 409A.  To the extent that any
payment provided under this Agreement is not exempt from Section 409A then, to
the extent required by Section 409A, the following will apply:  Any payment that
is triggered upon Executive’s termination of employment will be conditioned upon
the triggering termination constituting a Separation from Service, as defined
below. 

B. With respect to any amount that becomes payable to Executive upon his
Separation from Service, as defined below, for any reason, if QVC determines in
good faith that

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Executive is a “specified employee” within the meaning of Section 409A then, to
the extent required under Section 409A, payment of any amount that becomes
payable to Executive upon his Separation from Service (other than by reason of
his death) and that otherwise would be payable during the six-month period
following such Separation from Service will be suspended until the lapse of such
six-month period (or, if earlier, the date of Executive’s death).  Any payment
suspended under this provision, unadjusted for interest on such suspended
payment, will be paid to Executive in a single payment on the first business day
following the end of such six-month period or, if earlier, within 30 days
following Executive’s death, provided that such death during such six-month
period will not cause the acceleration of any amount that otherwise would be
payable on any date during such six-month period following the date of such
death.

C. A “Separation from Service” means Executive’s separation from service, as
defined in Section 409A, with QVC and all other entities with which QVC would be
considered a single employer under Internal Revenue Code Section 414(b) or (c),
applying the 80% threshold used in such Internal Revenue Code Sections or any
Treasury regulations promulgated thereunder. 

D. Any payment that is contingent upon the execution and nonrevocation of the
Release required under Section 9.H, which is not suspended by the application of
the provisions applicable to specified employees, as described above, will be
paid or commence to be paid on the 60th day following Executive’s Separation
from Service, notwithstanding any earlier expiration of the Consideration
Period.

E. Unless otherwise permitted under Section 409A, all in-kind benefits, expenses
or other reimbursements paid pursuant to this Agreement that are taxable income
to Executive (i) will be paid no later than the end of the calendar year next
following the calendar year in which Executive incurs such expense; (ii) will
not be subject to liquidation or exchange for another benefit; and (iii) the
amount of expenses eligible for reimbursements or in-kind benefits provided
during any taxable year shall not affect the expenses eligible for reimbursement
or in-kind benefits to be provided in any other taxable year.

21. Counterparts.  This Agreement may be executed and delivered in separate
counterparts (including by facsimile, “PDF” scanned image or other electronic
means), each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.  This Agreement will become
effective only when counterparts have been executed and delivered by all parties
whose names are set forth on the signature page(s) hereof.

 

IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
the day and year first above written.

QVC, INC.

 

By:

/s/ Larry Hayes

Name:

Lawrence R. Hayes

Title:

Sr. Vice President

 

 

 

EXECUTIVE:

 

/s/ Michael George

MICHAEL GEORGE

 

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