Exhibit 10.1


 


EMPLOYMENT
AGREEMENT


 


Agreement, made as of May 7, 2009 (“Effective
Date”), between Crown Media Holdings, Inc., a Delaware corporation, with
offices at 12700 Ventura Boulevard, Los Angeles, California 91604 (“Employer”)
and William Abbott (“Employee”).


 


WHEREAS, Employer desires to continue to employ
Employee as provided herein and Employee desires to be employed by Employer
upon the terms and conditions set forth:


 


NOW, THEREFORE, in consideration of the covenants
herein contained, the parties hereto agree as follows:


 


1.             Employment Duties.


 


(a)                                    As of the Effective Date, Employer and
Employee agree to terminate any and all existing agreements between them and
agree to extend Employee’s employment pursuant to the terms of this agreement
(“Employment Agreement”).  Employee
agrees to continue serving as Executive Vice President, National Advertising
Sales until June 1, 2009, at which time he will become and serve as
President and Chief Executive Officer. 
Additionally, Employee agrees to serve in such other capacities and
perform responsibilities as shall be designated from time to time by
Employer.  Employee shall use Employee’s
best efforts to promote the interests of Employer and shall devote Employee’s
full business time, energy and skill exclusively to the business and affairs of
Employer during the “Term” (as “Term” is defined in Paragraph 2 below).


 


(b)                                   During the course of Employee’s
employment hereunder, Employer may create or utilize subsidiary companies for
the production and distribution of programming or to conduct the other
activities and businesses of Employer. 
Employer shall have the right, without additional compensation to
Employee, to loan or make Employee available to any subsidiary of Employer or
company in common ownership with Employer to perform services for any
programming, property or project owned or controlled by Employer or any such
entity, provided that Employee’s services for any such entity shall be
consistent with Employee’s duties hereunder. 
Employee further agrees that all the terms of this Employment Agreement
shall be applicable to Employee’s services for each such entity.


 


2.             Term of Employment.  The term of
Employee’s employment (“Term”) with Employer shall commence on the Effective
Date and shall end on December 31, 2011, unless terminated earlier as
provided in Paragraph 8 of this Agreement; provided, however,
that if neither party provides notice to the other by June 30 of the last
year of the then current Term, then the Agreement shall automatically renew for
one additional year.


 


3.             Compensation.


 


(a)            Salary.  As
compensation for Employee’s services hereunder, Employer shall pay to Employee
a base salary at the annual rate of Six Hundred Seventy Thousand Dollars
($670,000) per 


 


1

















 


year.  During the Term and any extensions, Employer
will consider an adjustment of Employee’s base salary in June of each
year.


 


(b)            Performance Bonus.  Contingent on
employment through each year end; the end of the Term; or for termination of
employment pursuant to Paragraph 8(b) below, following the end of each
calendar year during the Term, Employee will be paid a bonus, to be pro rated
for partial calendar years within the Term, in an amount based on achievement
of criteria outlined by the Compensation Committee of Employer, which criteria
shall be the same as that established for the senior management team.  The target bonus will be 60% of base salary
for the applicable period with a payout range of 0-150%.  Such bonus will be paid to Employee on the
date following the applicable calendar year that Employer designates for
payment of bonuses to its employees in general, but in no event later than March 15.


 


(c)            LTI.  Employer will
award to Employee Long Term Incentive (“LTI”) in a Long Term Incentive
Compensation Agreement (attached as Schedule A) and pursuant to the terms of
and conditions of the Amended and Restated Crown Media Holdings, Inc. 2000
Long Term Incentive Plan (attached as Schedule B).  Employee has also been granted RSUs under a
prior agreement which is attached hereto as Schedule C (collectively, with the
Schedule A agreement, referred to herein as the “Incentive Agreements”).


 


(d)            Withholding.  All payments
of salary shall be made in appropriate installments to conform with the regular
payroll dates for salaried personnel of Employer.  Employer shall be entitled to deduct from
each payment of compensation amounts required under applicable laws or for
participation in any employee benefit plans.


 


(e)            Expenses.  During the
Term, Employer shall pay or reimburse Employee on an accountable basis for all
reasonable and necessary out-of-pocket expenses for entertainment, travel,
meals, hotel accommodations and other expenditures incurred by Employee in
connection with Employee’s services to Employer in accordance with Employer’s
expense account policies for its senior executive personnel.  When Employee is required by Employer for
business reasons to travel by air, Employer shall have the option to upgrade to
business class air accommodations if such fare does not exceed $100 more than
the coach fare.


 


(f)             Fringe Benefits.  During the
Term, Employee shall be entitled to receive the following fringe benefits
pursuant to plans which may be amended from time to time:


 


(i) group medical, dental, life and disability
insurance as per Employer policy;


 


(ii) an allowance of Thirteen Thousand Dollars
($13,000) per year for an automobile; and


 


(iii) any other fringe benefits on terms that are
or may become available generally to senior executives of Employer.  Employee shall also be entitled to four (4) weeks
paid vacation for each year of the Term, subject to accrual and usage as
outlined in Employer’s policies, as may be amended from time to time.


 


2

















 


4.             Place of Employment.  During the
Term, Employee shall be required to perform Employee’s duties at the Employer’s
office in New York City or at such other principal location in the New York
metropolitan area (or such other location as may be mutually agreeable to
Employer and Employee), and Employee shall undertake all travel required by
Employer in connection with the performance of Employee’s duties hereunder.


 


5.             Confidentiality, Intellectual Property;
Name and Likeness.


 


(a)            Employee agrees that Employee will not during the Term
or thereafter divulge to anyone (other than Employer and its executives,
representatives and employees who need to know such information or any persons
designated by Employer) any knowledge or information of any type whatsoever
designated or treated as confidential by Employer relating to the business of
Employer or any of its subsidiaries or affiliates, including, without
limitation, all types of trade secrets, business strategies, marketing and
distribution plans as well as concrete proposals, plans, scripts, treatments
and formats described in Subparagraph (b) below.  Employee further agrees that Employee will
not disclose, publish or make use of any such knowledge or information of a
confidential nature (other than in the performance of Employee’s duties
hereunder) without the prior written consent of Employer.  This provision does not apply to information
which becomes available publicly without the fault of Employee or information
which Employee discloses in confidence to Employee’s  own privileged representatives or is required to disclose in
legal proceedings, provided Employee gives advance notice to the Executive Vice
President, Legal and Business Affairs and General Counsel of Employer and an
opportunity to Employer to resist such disclosure in legal proceedings.


 


(b)            During the Term, Employee will disclose to Employer
all concrete proposals, plans, scripts, treatments, and formats invented or
developed by Employee during the Term which relate directly or indirectly to
the business of Employer or any of its subsidiaries or affiliates including,
without limitation, any proposals and plans which may be copyrightable,
trademarkable, patentable or otherwise exploitable.  Employee agrees that all such proposals,
plans, scripts, treatments and formats are and will be the property of
Employer.  Employee further agrees, at
Employer’s request, to do whatever is necessary or desirable to secure for the
Employer the rights to said proposals, plans, scripts, treatments, and formats,
whether by copyright, trademark, patent or otherwise and to assign, transfer
and convey the rights thereto to Employer at Employer’s expense.


 


(c)            Employer shall have the right in perpetuity to use
Employee’s name in connection with credits for programming, properties and
projects for which Employee performs any services pursuant to this Agreement.


 


6.             Employee’s Representations. 
Employee represents and warrants that Employee has the right to enter
into this Agreement and is not subject to any contract, commitment, agreement,
arrangement or restriction of any kind which would prevent Employee from
performing Employee’s duties and obligations hereunder.


 


3

















 


7.             Non-Competition; No Raid.


 


(a)            During the Term, Employee shall not engage directly or
indirectly, whether through self-employment or as an employee, independent
contractor, consultant, partner, shareholder or otherwise, in a business or
other endeavor which materially interferes with any of Employee’s duties or
obligations hereunder or which is directly competitive with the business of the
Employer or its subsidiaries, including but not limited to the production,
distribution or any other exploitation of audiovisual television material (the
“Other Business”).  Both parties
recognize that the services to be rendered hereunder by Employee are special,
unique and extraordinary in character. 
In the event of a breach of this Paragraph 7(a) by Employee or a
claim by Employee pursuant to this paragraph, both Employer and Employee shall
have all of the remedies available to Employer at law or equity.  Notwithstanding Paragraph 9 below, Employee
and Employer agree that temporary and permanent injunctive relief may be sought
by either in a court of law to enforce this Paragraph 7(a) and Paragraph 7(b) below.


 


(b)            Employee further agrees that during the Term and for a
period of one year thereafter, Employee will not:


 


(i)            employ, or attempt to employ or assist
anyone else to employ, any person who is, at the date of termination of
Employee’s employment, working as an officer, policymaker or in high-level
creative development or distribution (including without limitation executive
employees) for or rendering substantially full-time services as such to
Employer;


 


(ii)           publicly disparage Employer or its Board
of Directors, individually or collectively, or


 


(iii)          interfere
with Employer’s relationships with suppliers, customers, or other organizations
or individuals with which Employer has a business relationship or is pursuing a
business relationship during the Term.


 


8.             Termination.


 


(a)            This Agreement may be terminated and the Term ended on
five (5) business days’ written notice for any one of the following
reasons (except (i) in which case termination shall occur on the date of
death):


 


(i)            The death of Employee;


 


(ii)           A serious health condition of Employee
that incapacitates Employee (as defined under the Family Medical Leave Act) for
a period exceeding an aggregate of twelve (12) work weeks during any twelve
(12) month period of the Term.  For
purposes of counting the aggregate work weeks, days properly designated by
Employee as vacation days shall not be counted. 
In the case of termination by virtue of either the death or disability
of Employee, Employee or his heirs will be paid any bonuses which Employee has
earned and which are attributable to periods prior to the effective date of
termination, such payment to occur on the date such bonus would normally be
paid;


 


(iii)          For
“cause,” which for purposes of this Agreement shall be defined as:


 


(A)          The use of a controlled substance and/or alcohol,
either of which materially interfere with Employee’s performance of Employee’s
services under this Agreement;


 


4

















 


(B)           Employee’s commission of any act which constitutes a
felony under federal, state or local laws or the law of any foreign country;


 


(C)           Employee’s persistent failure or refusal after written
notice to perform any of Employee’s duties and responsibilities pursuant to
this Agreement as determined by the Board of Directors;


 


(D)          Employee’s dishonesty in financial dealings with or on
behalf of Employer, its subsidiaries, affiliates and parent corporation or in
connection with performance of Employee’s duties hereunder;


 


(E)           Employee’s material breach of any provision of this
Agreement; or


 


(F)           Employee’s voluntary resignation.


 


In the event of termination under Paragraph 8(a)(iii),
solely for purposes of Paragraph 7, the Term shall not be deemed terminated and
shall continue until the first to occur of twelve (12) months from termination
or December 31, 2011.


 


(b)            Employer shall also have the right to terminate
Employee prior to the expiration of the Term in addition to pursuant to
Paragraph 8(a) above by providing Employee with written notice.  In the event of a termination pursuant to
this Paragraph 8(b), Employee shall not be entitled to any further compensation
or benefits except (1) as may be provided under the Incentive Agreements; (2) twelve
(12) months base salary, paid in a lump sum and discounted at “prime rate” to
present value at the time of payment; (3) vested ERISA benefits (e.g.,
401k plan); (4) benefits that may be required by law (e.g., COBRA); and (5) pro
rata bonus through the date Employee’s job duties end to be paid as provided in
Paragraph 3(b) above.  Employee
shall have no obligation to seek comparable employment and if Employee does
accept other employment, there will be no offset by Employer against the
amounts payable under this Paragraph 8(b). 
If Employer terminates Employee under this Paragraph 8(b), Paragraph 7(a) shall
not apply from the date of termination.


 


(c)            In the event that Employer terminates this Agreement
due to any of the reasons set forth in Paragraph 8(a) above, Employee
shall be paid Employee’s salary through the later of the expiration of the five
(5) business days period referred to in Paragraph 8(a) or the end of
the month in which the termination event occurs, after which Employer’s
obligation to pay salary to Employee shall terminate.  After making the payments provided for in
this Subparagraph (c), Employer shall have no further obligations to Employee
pursuant to this Agreement, except (1) as may be provided under the
Incentive Agreements; (2) vested ERISA benefits; or (3) benefits that
may be required by law (e.g., COBRA).


 


(d)            Upon termination of this Agreement, Employee shall not
retain any business records or documents (including electronic) relating to any
activity of Employer or any of its parent, subsidiary or affiliated companies,
shall not disseminate any such information in any format, and shall return any
business records, documents and property (including electronic) belonging to
Employer or its 


 


5

















 


parents, subsidiaries and
affiliates.  This includes all
information that the Employee may have in hard copy or on any electronic media
(such as CD, DVD, thumb drives, portable hard drives, home computer, etc.).


 


(e)            Upon termination of Employee’s employment for any
reason, Employee shall tender Employee’s resignation from the Board of
Directors of Employer or any of Employer’s subsidiaries or affiliates on which
Employee is serving, and Employer shall accept such resignation forthwith.


 


9.             Arbitration.  Any dispute
between the Employee and Employer involving any provision of this Agreement of
employment matter; including any claim of discrimination under state and
federal law, other than an action in court requesting temporary or permanent
injunctive relief as set forth in Paragraph 7 above, shall be resolved by
arbitration under the employment rules of the American Arbitration
Association and in accordance with applicable law, allowing all damages and
remedies available in a court action. 
Such arbitration shall be conducted in the New York City metropolitan
area before one (1) neutral arbitrator who is a lawyer with expertise in
employment law.  Employer shall pay the
expenses of the arbitration and each party shall pay its own legal fees and
expenses.  The arbitrator shall provide a
reasoned opinion supporting his/her conclusion, including detailed findings of
fact and conclusions of law.  Such
findings of fact shall be final and binding on the parties, but such
conclusions of law shall be subject to appeal in any court of competent
jurisdiction.  The parties further
stipulate that the laws of New York shall apply to any dispute or action
regarding this Agreement.


 


10.           Assignment.  This
Agreement is a personal contract and, without the prior written consent of
Employer, shall not be assignable by the Employee.  The rights and obligations of Employer may be
assigned and such assignment shall bind in their entirety the successors and
assigns of Employer.  As used in this
Agreement, the term “successor” shall include any person, firm, corporation or
other business entity which at the time, whether by merger, purchase or
otherwise, acquires all of substantially all of the assets or business of
Employer.


 


11.           Amendment; Captions.  This
Agreement contains the entire agreement between the parties.  It may not be changed orally, but only by
agreement in writing signed by the party against whom enforcement of any
waiver, change, modification or discharge is sought.  Paragraph headings are for convenience of
reference only and shall not be considered a part of this Agreement.  If any clause in this Agreement is found to
be unenforceable, illegal or contrary to public policy, the parties agree that
this Agreement shall remain in full force and effect except for such clause.


 


12.           Notices.  Any notices
or other communications required or permitted hereunder shall be in writing and
shall be deemed effective when delivered in person or if mailed, by registered
or certified mail, return receipt requested, in which case the notice shall be
deemed effective on the date of deposit in the mails, postage prepaid,
addressed to Employee at the address for Employee appearing in Employer’s
records.  Notices to Employer shall be
addressed to its Chief Executive Officer at the address first written above, with
a copy to the Executive Vice President of Legal and Business Affairs, Crown
Media Holdings, Inc., 12700 Ventura Blvd., Studio City, CA  91604. 
Either party may change the address to which notices are to be addressed
by notice in writing given to the other in accordance with the terms hereof.


 


6

















 


13.           Periods of Time.  Whenever in
this Agreement there is a period of time specified for the giving of notices or
the taking of action, the period shall be calculated excluding the day on which
the giver sends notice and excluding the day on which action to be taken is
actually taken.


 


14.           Laws.  The laws of
the state of New York shall apply to this Agreement and the employment
relationship without the application of any conflict of law provisions.


 


15.           Counterparts.  This
Agreement may be signed in any number of counterparts, each of which shall be
an original, and all of which, taken together, shall constitute one instrument.


 


IN WITNESS WHEREOF, Employer has by its appropriate
officer signed this Agreement and Employee has signed this Agreement as of the
day and year first above written.


 


	
   

  	
  CROWN MEDIA HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Donald J. Hall, Jr.

  
	
   

  	
  Title:

  	
  Co-Chairman of the Board

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ William J. Abbott

  
	
   

  	
  William Abbott

  



 


7