Exhibit
10.1


 


	
   

  	
  June 23, 2003

  



 


Mr. Thomas Rutledge

365 West Road

New Canaan, CT  06840


 


Re:                               Employment
Agreement


 


Dear
Mr. Rutledge:


 


This letter will confirm
the terms of your employment by Cablevision Systems Corporation (the “Company”).


 


You shall continue to be
employed as President of Cable & Communications through December 31,
2006, with possible one-year extensions as provided below.  You agree to devote substantially all of
your business time and attention to the business and affairs of the Company.  Subject to such continuing rights as each
party may have hereunder, either you or the Company may terminate your
employment hereunder at any time.  Your
employment term will automatically be extended for additional one-year periods
effective as of December 31, 2004 (i.e., to December 31, 2007), 2005 (i.e.,
to December 31, 2008) and 2006 (i.e., to December 31, 2009) unless
either party notifies the other in writing of its election not to extend by the
preceding October 31.


 


Your
annual base salary will be a minimum of $1,100,000, subject to annual review
and increase by the Compensation Committee of the Board of Directors (the “Compensation
Committee”) in its discretion. 
Your base salary shall not be reduced during the time of this Agreement.


 


Your
annual bonus will have a target of 105% of your annual base salary, and may
range from 0% to 210% of your annual base salary, as the Compensation Committee
shall determine in its discretion.


 


You
will receive, reasonably promptly after the execution of this Agreement, an
award of stock options with a 10 year term covering 115,000 shares of
Class A Common Stock with an exercise price equal to fair market value of
the underlying stock on the date of grant and vesting in equal one-third
installments on each of the first three anniversaries of the grant.  The options will be issued under the
Company’s Employee Stock Plan.


 

















 


You
will receive, reasonably promptly after the execution of this Agreement, an
award of 115,000 shares of restricted Class A Common Stock under the
Company’s Employee Stock Plan, the restrictions on which and other provisions
of which will be the same as those applying to comparable awards to other
senior executives of the Company and will expire on the fourth anniversary of
the grant.


 


You
will receive a performance award covering a three-year performance period
beginning on January 1, 2004.  The
size and other terms of the award will be determined by the Compensation
Committee in its discretion.


 


You
will continue to participate in all employee benefits and future grants
(including stock options, stock appreciation and conjunctive rights,
performance awards, deferred compensation, incentive plans and similar
programs) at the level available to senior management of the Company.


 


You
and the Company agree to be bound by the additional covenants
applicable to each that are set forth in Annex B, which shall be
deemed to be part of this Agreement.


 


If
your employment with the Company is terminated (1) for any reason by you
during the thirteenth calendar month following a “Change in Control” of the
Company, (2) by the Company, or (3) by you for “Good Reason,” and at the
time of such termination under clauses
(1), (2) or (3) “Cause” does not
exist, then, subject to your execution and delivery of the Company’s then
standard severance agreement (modified to reflect the terms of this Agreement)
which will include, without limitation, general releases, and non-competition,
non-solicitation, non-disparagement, confidentiality and conflict of interest
provisions substantially similar to those set forth in Annex B, the Company will
provide you with the following benefits and rights:


 


1.                                       An upfront severance payment in an amount
determined at the discretion of the Compensation Committee, but in no event
less than 2.99 times the sum of your annual base salary and your annual target bonus
as in effect at the time your employment terminates;


 


2.                                       All of your outstanding incentive and/or
performance grants and awards (and similar plans and programs) shall be deemed
vested and/or earned (as applicable), and all restrictions on any restricted
stock granted to you under plans of the Company shall be eliminated;


 


3.                                       The immediate vesting of all stock options
and stock appreciation and conjunctive rights awards (and similar plans and
programs) granted to you under plans of the Company and the continuation of the
right to exercise those options and awards for the remainder of the term of such options and awards, irrespective of the termination of your employment; and


 


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4.                                       The right to enter into a consulting
agreement with the Company containing the following terms and other customary
terms:


 


a.                                       The terms of such consulting agreement shall
be three years from the date your employment ceases;


 


b.                                      During such term you shall provide advice and
counsel to the Company as requested but for no more than 80 hours in any
calendar month;


 


c.                                       During the first year of such term your
compensation shall be $550,000 and your compensation shall thereafter be
reviewed annually by the Compensation Committee and shall be such amount as the
Compensation Committee shall determine, in its discretion, but not less than
$550,000; and


 


d.                                      During such term you shall be provided with
an office and adequate support.


 


If
you cease to be an employee of the Company as a result of your death or
physical or mental disability, you (or your estate or beneficiary) will receive
payment of all your outstanding bonus and restricted share and deferred
compensation awards; the right to receive payment of all outstanding
performance awards, at such time, if any, as such awards shall be earned (as if
you remained in the continuous employ of the Company through the payment date);
and the right to exercise all your stock option and stock appreciation and
conjunctive rights awards for the remainder of the term of this Agreement or
for a period of one year, if greater, whether or not such awards shall be due
and exercisable at the time and all restrictions on any restricted stock shall
be eliminated.


 


If
your employment with the Company is terminated (other than for Cause) prior to
December 31 of any year, you shall receive a prorated bonus for the
portion of the year you worked for the Company.


 


If
you cease to be employed by the Company for any reason other than your being
terminated for Cause, you shall be deemed to have retired and you shall have
three years to exercise outstanding stock options and conjunctive rights,
unless you are afforded a longer period for exercise pursuant to another
provision of this Agreement.


 


The
Company may withhold from any payment due hereunder any taxes that are required
to be withheld under any law, rule or regulation.


 


This
Agreement is personal to you and without the prior written consent of the
Company shall not be assignable by you otherwise than by will or the laws of
descent and distribution.  This
Agreement shall inure to the benefit of and be enforceable by your legal
representatives.  This Agreement shall
inure to the benefit of and be binding upon the Company and its successors and
assigns.


 


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To the extent permitted by law, you and the Company waive any
and all rights to the jury trial with respect to any Employment Matter.


 


This Agreement will be governed by and construed in
accordance with the law of the State of New York applicable to contracts made
and to be performed entirely within that State.


 


Both the Company and you
hereby irrevocably submit to the jurisdiction of the courts of the State of New
York and the federal courts of the United States of America located in the
State of New York solely in respect of the interpretation and enforcement of
the provisions of this Agreement, and each of us hereby waives, and agrees not
to assert, as a defense that either of us, as appropriate, is not subject
thereto or that the venue thereof may not be appropriate.  We each hereby agree that mailing of process
or other papers in connection with any such action or proceeding in any manner
as may be permitted by law shall be valid and sufficient service thereof.


 


This
Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.  The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.  It is the parties’ intention that this
Agreement not be construed more strictly with regard to you or the Company.  From and after the Effective Date, this
Agreement shall supersede any other employment or severance agreement or
arrangements between the parties (and you shall not be eligible for severance
benefits under any plan, program or policy of the Company).


 


Certain
capitalized terms used herein have the meanings set forth in Annex A
hereto.


 


	
   

  	
  CABLEVISION
  SYSTEMS CORPORATION

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  James L. Dolan

  	
   

  
	
   

  	
  Title:

  	
  President and Chief Executive Officer

  	
   

  
	
   

  	
   

  	
   

  
	
  Accepted
  and Agreed:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Thomas Rutledge

  	
   

  	
   

  
						



 


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Annex A


 


DEFINITIONS
ANNEX


 


(This
Annex constitutes part of the Agreement)


 


“Cause”
means your (i) commission of an act of fraud, embezzlement,
misappropriation, willful misconduct, gross negligence or breach of fiduciary
duty against the Company or an affiliate thereof, or (ii) commission of any act
or omission that results in, or may reasonably be expected to result in, a
conviction, plea of no contest, plea of nolo
contendere, or imposition of unadjudicated
probation for any felony or crime involving moral turpitude.


 


Termination
for “Good
Reason” means that (i) you and the Company have not extended this
Agreement and you elect to terminate your full time employment with the Company
at the end of the term of your employment or (ii) (1) without your
consent, (A) your base salary, bonus target or title as an employee is
reduced, (B) the Company requires that your principal office be located
outside of Nassau County or Manhattan, (C) the Company materially breaches
its obligations to you under this Agreement, (D) you are no longer the
President of Cable & Communications of the Company, (E) you report
directly to someone other than the Chairman of the Board of Directors of the
Company or the Chief Executive Officer of the Company, or (F) your
responsibilities are materially diminished, (2) you have given the Company
written notice, referring specifically to this definition, that you do not
consent to such action, (3) the Company has not corrected such action
within 15 days of receiving such notice, and (4) you voluntarily terminate
your employment within 90 days following the happening of the action described
in subsection (1) above.


 


 “Change in Control” means the acquisition,
in a transaction or a series of related transactions, by any person or group,
other than Charles F. Dolan or members of the immediate family of Charles F.
Dolan or trusts for the benefit of Charles F. Dolan or his immediate family (or
an entity or entities controlled by any of them) or any employee benefit plan
sponsored or maintained by the Company, of (1) the power to direct the
management of substantially all the cable television systems then owned by the
Company in the New York City Metropolitan Area (as hereinafter defined) or (2) after
any fiscal year of the Company in which all the systems referred to in clause
(1) above shall have contributed in the aggregate less than a majority of
the net revenues of the Company and its consolidated subsidiaries, the power to
direct the management of the Company or substantially all its assets.  Net revenues shall be determined by
independent accountants of the Company in accordance with generally accepted
accounting principles consistently applied and certified by such
accountants.  “New York City Metropolitan Area”
means all locations within the following counties (A) Manhattan (New York
County), Richmond, Kings, Queens, Bronx, Nassau, Suffolk, Westchester,
Rockland, Orange, Putnam, Sullivan, Dutchess, and Ulster in New York State;
(B) Hudson, Bergen Passaic, Sussex, Warren, Hunterdon, Somerset, Union,
Morris, Middlesex, Mercer, Monmouth, Essex and Ocean in New Jersey;
(C) Pike in Pennsylvania; and (D) Fairfield and New Haven in
Connecticut.


 

















Annex B


 


ADDITIONAL
COVENANTS


(This Annex constitutes part of the Agreement)


 


You
agree to comply with the following covenants in addition to those set forth in
the Agreement.


 


1.                                      Confidentiality


 


You agree to keep
confidential and otherwise refrain from accessing, discussing, copying,
disclosing or otherwise using Confidential Information (as hereinafter defined)
or any information (personal, proprietary or otherwise) you may have
learned about the Covered Individuals (as hereinafter defined) directly or
indirectly as a result of your relationship with Charles Dolan, James Dolan,
any member of the extended Dolan family or any member of the Company’s senior
management team or, to the extent applicable, any of their Board of Directors
(collectively the “Covered Individuals”), whether prior to
your employment by the Company or subsequent to such employment (“Other
Information”).


 


As used in this
Agreement, “Confidential
Information” is information of a commercially sensitive, proprietary
or personal nature and includes, but is not limited to, information and
documents that the Company has designated or treated as confidential.  It also includes, but is not limited to,
financial data; customer, guest, vendor or shareholder lists or data;
advertising, business, sales or marketing plans, tactics and strategies;
projects; technical or strategic information about the Company’s on-line data,
telephone, internet service provider, cable television, programming (including
sports programming), advertising, retail electronics, PCS, DBS, theatrical,
motion picture exhibition, entertainment or other businesses; plans or
strategies to market or distribute the services or products of such businesses;
economic or commercially sensitive information, policies, practices, procedures
or techniques; trade secrets; merchandising, advertising, marketing or sales
strategies or plans; litigation theories or strategies; terms of agreement with
third parties and third party trade secrets; information about the Company’s
employees, players, coaches, agents, teams or rights, compensation (including,
without limitation, bonuses, incentives and commissions), or other human
resources policies, plans and procedures, or any other non-public material or
information relating to the Company’s business activities, communications,
ventures or operations.


 


If disclosed,
Confidential Information or Other Information could have an adverse effect on
the Company’s standing in the community, its business reputation, operations or
competitive position or the standing, reputation, operations or competitive position
of any of its affiliates, subsidiaries, officers, directors, employees, teams,
players, coaches, consultants or agents or any of the Covered Individuals.


 


Notwithstanding
the foregoing, the obligations of this section, other than with respect to subscriber
information, shall not apply to Confidential Information which is:


 

















 


a)                                      already in the public domain;


 


b)                                     disclosed to you by a third party with the right to
disclose it in good faith; or


 


c)                                      specifically exempted in writing by the Company from the
applicability of this Agreement.


 


Notwithstanding
anything elsewhere in this Agreement, you are authorized to make any disclosure
required of you by any federal, state and local laws or judicial, arbitral or
governmental agency proceedings, after providing the Company with prior written
notice and an opportunity to respond prior to such disclosure.  In addition, this Agreement in no way
restricts or prevents you from providing truthful testimony concerning the Company
to judicial, administrative, regulatory or other governmental authorities.


 


2.                                      Non-Compete


 


You acknowledge
that due to your executive position in the Company and your knowledge of the
Company’s confidential and proprietary information, your employment or
affiliation with certain entities would be detrimental to the Company.  You agree that, without the prior written
consent of the Cablevision, you will not represent, become employed by, consult
to, advise in any manner or have any material interest in any business directly
or indirectly in any Competitive Entity (as defined below).  A “Competitive Entity” shall mean (1) any
company that competes with any of the Company’s or its affiliates’ professional
sports teams in the New York metropolitan area; (2) any company that competes
with any of the Company’s cable television, telephone, on-line data or direct
broadcast satellite businesses in the New York
greater metropolitan area or that competes with any of the Company’s
programming businesses, nationally or regionally; or (3) any trade or professional
association representing any of the companies covered by this paragraph, other
than the National Cable Television Association and any state cable television
association.  Ownership of not more than
1% of the outstanding stock of any publicly traded company shall not be a
violation of this paragraph.  This
agreement not to compete will become effective on the date of the Agreement and
will expire upon the first anniversary of the date of your termination of employment
with the Company.


 


3.                                      Additional
Understandings


 


You agree, for
yourself and others acting on your behalf, that you (and they) have not
disparaged and will not disparage, make negative statements about or act in any
manner which is intended to or does damage to the good will of, or the business
or personal reputations of the Company or any of its incumbent or former
officers, directors, agents, consultants, employees, successors and assigns
or any of the Covered Individuals.


 


In addition, you
agree that the Company is the owner of all rights, title and interest in and to
all documents, tapes, videos, designs, plans, formulas, models, processes,
computer programs, inventions (whether patentable or not), schematics, music,
lyrics and other technical, business, financial, advertising, sales, marketing,
customer or product development plans, forecasts, strategies,


 


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information and
materials (in any medium whatsoever) developed or prepared by you or with your
cooperation during the course of your employment by the Company (the “Materials”).  The Company will have the sole and exclusive
authority to use the Materials in any manner that it deems appropriate, in
perpetuity, without additional payment to you.


 


4.                                      Further Cooperation


 


Subject to the
terms of any consulting agreement entered into pursuant to this Agreement,
following the date of termination of your employment with the Company (the “Expiration
Date”), you will no longer provide any regular services to the
Company or represent yourself as a Company agent.  If, however, the Company so requests, you agree to cooperate
fully with the Company in connection with any matter with which you were
involved prior to the Expiration Date, or in any litigation or administrative
proceedings or appeals (including any preparation therefore) where the Company
believes that your personal knowledge, attendance and participation could be
beneficial to the Company.  This
cooperation includes, without limitation, participation on behalf of the
Company in any litigation or administrative proceeding brought by any former or
existing Company employees, teams, players, coaches, guests, representatives,
agents or vendors.  The Company will pay
you for your services rendered under this provision at the rate of $4,600 per
day for each day or part thereof, within 30 days of approved invoice therefore.


 


Unless the Company
determines in good faith that you have committed any malfeasance during your
employment by the Company, the Company agrees that its corporate officers and
directors, employees in its public relations department or third party public
relations representatives retained by the Company will not disparage you or
make negative statements in the press or other media which are damaging to your
business or personal reputation.  In the
event that the Company so disparages you or makes such negative statements,
then notwithstanding the “Additional Understandings” provision to the contrary,
you may make a proportional response thereto.


 


The Company will
provide you with reasonable notice in connection with any cooperation it
requires in accordance with this section and will take reasonable steps to
schedule your cooperation in any such matters so as not to materially
interfere with your other professional and personal commitments.  The Company will reimburse you for any
reasonable out-of-pocket expenses you reasonably incur in connection with the
cooperation you provide hereunder as soon as practicable after you present
appropriate documentation evidencing such expenses.  You agree to provide the Company with an estimate of such expense
before you incur the same.


 


5.                                      Non-Hire or
Solicit


 


You agree not to
hire, seek to hire, or cause any person or entity to hire or seek to hire
(without the prior written consent of the Company), directly or indirectly
(whether for your own interest or any other person or entity’s interest) any
current employee of the Company, or any of its subsidiaries or affiliates, for
the term of the Agreement and until one year after the termination of your
employment.  This restriction does not
apply to any employee who was discharged by the


 


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Company.  In addition, this restriction will not
prevent you from providing references.


 


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