Exhibit 99.3
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT (this
“Agreement”) is dated as of April 1, 2005, between
NEXTMEDIA GROUP, INC., a Delaware corporation
(“Employer”) and SAMUEL WELLER
(“Executive”).
WHEREAS, Executive is employed by
Employer under an Employment Agreement, dated March 6, 2000 (the
“ Original Employment Agreement ”);
and
WHEREAS, Executive and Employer
desire to terminate the Original Employment Agreement effective as
of January 1, 2005 and replace the Original Employment Agreement
with this Agreement on the terms and conditions herein
provided.
NOW, THEREFORE, for good and
valuable consideration, the sufficiency and receipt of which are
hereby acknowledged, Employer and Executive agree as
follows:
1. Employment and Employment
Period. During the period specified in this Section 1, Employer
shall employ Executive, and Executive shall serve Employer, on the
terms and subject to the conditions set forth herein. The term of
Executive’s employment under this Agreement commenced on
January 1, 2005 (the “Effective Date”) and, subject to
prior termination as provided in Section 6 below, shall continue
through the fifth anniversary of the Effective Date. The term of
Executive’s employment under this Agreement is sometimes
referred to below as the “Employment
Period.”
2. Duties, Responsibilities,
Reporting, No Services for Others.
(a) At all times during the
Employment Period, Executive (i) shall serve as Senior Executive
Vice President, and President and Co-Chief Operating Officer of the
Radio Division or such other comparable management position or
positions as designated by the Board of Directors of Employer (the
Board of Directors or any successor equivalent governing body of
Employer, the “Board of Directors”) from time to time,
(ii) shall perform duties in furtherance of the business of
Employer, as may be assigned to him from time to time by the Chief
Executive Officer of Employer, including specifically the duties
relating to operations and strategy relating to the radio
operations of Employer, and (iii) except as set forth in Section
2(b) hereof, shall devote his entire business time, energy, talent,
and best efforts to the faithful and efficient performance of his
duties as Senior Executive Vice President, and President and
Co-Chief Operating Officer of the Radio Division.
(b) Executive shall not, at any time
during the Employment Period, directly or indirectly, render any
business, commercial, or professional services to any other person,
firm, or organization (other than the Company and its Affiliates)
for compensation without the prior approval of the Board of
Directors. Nothing in this Agreement shall preclude Executive from
devoting reasonable periods of time and effort to charitable
and
community activities or the
management of his personal investment assets; provided, that such
activities do not interfere in any material respect with the
performance by Executive of his duties hereunder.
3. Compensation .
(a) Base Salary . During the
Employment Period, Employer shall pay to Executive an annual base
salary (the “Base Salary”) in regular equal
installments in accordance with Employer’s usual payroll
practice. Executive’s Base Salary for the first contract year
shall be Three Hundred Thirty-Seven Thousand Five Hundred Dollars
($337,500), which Base Salary shall be subject to appropriate
increase each year thereafter at the discretion of the compensation
committee of the Board of Directors (the “Compensation
Committee”).
(b) Bonus. Executive shall be
entitled to an annual bonus (the “Bonus”) for each
fiscal year in which Executive is employed hereunder in an amount
equal to such percentage of Executive’s Base Salary for such
fiscal year as may be determined by the Compensation Committee in
its reasonable discretion and based upon the recommendation of the
Chief Executive Officer. Any bonus determined to be payable under
this section shall be paid by Employer to Executive as soon as
practicable following the completion of the annual audit of
Employer.
(c) Withholdings . Employer
shall, in accordance with applicable law, deduct from the Base
Salary, the Bonus and all other cash amounts payable by Employer
under the provisions of this Agreement to Executive, or, if
applicable, to his estate, legal representatives or other
beneficiary designated in writing by Executive, all social security
taxes, all Federal, state and municipal taxes and all other charges
and deductions that now or hereafter are required by law to be
charges on the compensation of Executive or charges on cash
benefits payable by Employer hereunder to Executive’s estate,
legal representatives or other beneficiary.
4. Retirement and Employee
Welfare Benefits. During the Employment Period, Executive shall
be entitled to participate in, and shall receive benefits in
accordance with the terms of, all retirement and welfare benefits
plans, practices, policies, and programs that are made available by
the Employer to other senior executives, which, at a minimum, shall
include the following:
(a) Life Insurance . Employer
shall provide Executive, and keep in full force and effect at all
times during the Employment Period, without cost to Executive, a
term life insurance policy with a death benefit equal to not more
than $1,000,000, subject to Executive’s insurability at
standard group rates. Employee shall be solely responsible for the
payment of any Federal and /or state taxes that may be levied as a
result of Employer furnishing such life insurance policy, and
Executive, his estate and/or heirs hereby
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indemnify and hold harmless Employer
from and against any and all taxes that may be payable in
connection with such life insurance policy. Executive shall have
the privilege of designating the beneficiary thereof and may change
the beneficiary thereof by providing written notice to Employer and
shall have such other rights of ownership provided by such life
insurance policy, subject to the rules and regulations of the
issuing insurance company. Executive shall have the right to assign
such life insurance policy to Executive’s spouse or issue, or
to a trust primarily for the benefit of Executive’s spouse
and/or issue. Upon the termination of this Agreement for any
reason, Employer shall assign such life insurance policy to
Executive, without cost to Executive, provided that Executive shall
pay all premiums and other costs relating to such life insurance
policy from and after the date of such assignment.
(b) Medical Benefits .
Employer shall provide to Executive and his immediate family, to
the extent eligible and at all times during the Employment Period,
major medical coverage and disability insurance in an amount not
less than sixty percent (60%) of the Executive’s Base Salary
then in effect. If Employer is notified that Executive does not
qualify for such disability insurance at standard rates, Employer
will so advise Executive within five (5) days after Employer has
received such notification of non-qualification.
(c) Reimbursement for Business
Expenses . Executive shall be permitted first class air travel
(when up-grades from coach class air travel cannot be obtained) and
hotel accommodations for all business-related travel and
entertainment. Employer shall reimburse Executive promptly upon
production of reasonably detailed accounts, receipts, vouchers or
other reasonable evidence of payment by Executive, for all
ordinary, reasonable and necessary travel, entertainment and other
expenses as shall be incurred by him in the performance of his
duties hereunder.
(d) Automobile . During the
Employment Period, Employer shall provide Executive with or pay or
reimburse Executive for his lease or purchase of an automobile, the
aggregate expense of which shall not exceed $10,000 per
annum.
(e) Vacations . During each
complete twelve (12) month period of the Employment Period,
Executive shall be entitled to paid vacation time at the rate of
not more than four (4) weeks per calendar year, provided that such
vacation shall be taken at such time or times as Executive may
determine in such a manner as to avoid undue disruption to the
business of Employer. Executive shall also be entitled to such
personal leave, holiday leave and sick leave as may be permitted
pursuant to the general practice and policies of
Employer.
(f) Club Membership . During
the Employment Period, Employer shall reimburse Executive for
membership dues, up to a maximum of Five Thousand Dollars ($5,000)
per calendar year, for a tennis, fitness, business lunch club or
similar facility to be used by
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Executive for business purposes.
Employer shall have the right to approve the club membership, which
approval shall not be unreasonably withheld.
(g) Stock or other Equity
Plans . Upon the consummation of an initial public offering of
the stock of the Employer, Executive shall participate in such
stock award, stock option or other similar equity plans as shall be
determined by Employer’s Board of Directors to be fair,
appropriate and customary for an employee in the position of
Executive, in each case, subject to the provisions
thereof.
(h) Location of Offices .
Upon the establishment of a permanent home/headquarters office or
location for Employer where Executive will be required to perform
his duties under this Agreement, Executive shall be reimbursed for
(i) all reasonable and necessary travel expenses incurred by
Executive and/or Executive’s spouse in the search for living
accommodations and (ii) all reasonable and necessary moving and
temporary living expenses incurred by Executive, in each case, to
the extent such permanent home/headquarters office or location is
more than fifty (50) miles from Executive’s primary residence
at the date of this Agreement.
(i) Excise Tax .
Notwithstanding anything herein to the contrary, if it is
determined that any payment or benefit provided by Employer to
Executive (whether hereunder or otherwise, and including any
payments or benefits provided pursuant to this Agreement) would be
subject to the excise tax imposed by Section 4999 of the Internal
Revenue Code of 1986, as amended (or any successor provision), or
any interest or penalties with respect to such excise tax or any
other similar excise tax or surcharge imposed by any applicable
federal or state law, rule or regulation (such excise tax or
surcharge together with any interest or penalties thereon, the
“Excise Tax”), then Executive shall be entitled to an
additional cash payment (a “Gross-Up Payment”) in an
amount that will place Executive in the same after-tax economic
position as Executive would have been in had the Excise Tax not
applied to the payment or benefit. The amount of the Gross-Up
Payment shall be determined by Employer’s regular independent
auditors. No Gross-Up Payment shall be payable hereunder if
Employer’s auditors determine that such payments or benefits
are not subject to an Excise Tax. Employer shall be responsible for
the payment of any fees and expenses of such auditors for any
services provided in connection with any determination of a
Gross-Up Payment.
5. Effect of Disability While in
Employ of Employer . If, during the Employment Period,
Executive becomes disabled, by reason of physical or mental
impairment, disability or infirmity to such an extent that he is
unable to perform his duties under this Agreement for more than
ninety (90) working days in any twelve (12) consecutive month
period, as determined in good faith by the Board of Directors
(“Disability” or “Disabled”):
(a) Employer may relieve Executive
of his duties under this Agreement for as long as Executive is so
Disabled.
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(b) Employer shall pay to Executive,
net of the offset referred to in the last sentence of this Section
5(b), all Base Salary, if any, to which he would have been entitled
under this Agreement had he continued to be actively employed by
Employer to the earliest of (i) the first date on which he is no
longer so Disabled, (ii) the date on which his employment is
terminated by Employer due to Disability pursuant to Section 6(a),
(iii) the date of his death, or (iv) the end of the Employment
Period due to any reason other than termination by Employer due to
Disability pursuant to Section 6(a) or death. Any payment referred
to in this Section 5(b) shall be made at the same time as that
payment would have been made if Executive were not Disabled.
Payments under this Section 5(b) for any period shall be offset,
dollar for dollar, by any disability benefits (other than benefits
payable pursuant to any disability insurance policy all of the
premiums for which were paid by Executive and not Employer) for
that period that are received by Executive.
(c) Except as provided in this
Section 5, Employer shall have no further obligations to Executive
for Base Salary or Bonus for any period during which Executive is
so Disabled.
(d) Executive agrees to submit such
medical evidence regarding such Disability as may be reasonably
requested by the Board of Directors.
6. Termination .
(a) Death or Disability .
Executive’s employment hereunder will terminate immediately
upon Executive’s death. Employer may terminate
Executive’s employment hereunder as of the effective date
specified in Employer’s notice of termination if Executive is
Disabled, which effective date shall not be earlier than the
ninety-first (91 st ) working day (excluding vacation
days) following the commencement of Executive’s Disability,
provided, that such notice shall be delivered to Executive not
later than ten (10) days from the effective date of termination
specified in such notice.
(b) By Employer for Cause .
Employer may terminate Executive’s employment under this
Agreement for “Cause” (and Executive’s employment
will be deemed to have been terminated for “Cause”) if,
as of the date of termination, any of the following circumstances
have occurred:
(i) Except as otherwise permitted by
Section 2(b) hereof, Executive has refused to perform his duties as
an employee of the Employer or failed to devote his entire
business, time, energy, talent and best efforts to the performance
of his duties under this Agreement in any material
respect;
(ii) Executive has been convicted
of, or entered a plea of nolo contendere to, a felony;
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(iii) Executive has engaged in any
fraudulent or dishonest conduct or acts in the course of his
employment with Employer in connection with Employer, the Company
or any of its Affiliates;
(iv) Executive breaches any of his
obligations hereunder in any material respect;
(v) Executive has been grossly
negligent in the performance of his duties under this
Agreement;
(vi) Executive has engaged in the
illegal use of drugs or suffers from drug dependence or habitual
insobriety;
(vii) Employer materially breaches
any financial covenant contained in any of its contractual
obligations and such breach is not cured or waived prior to the
expiration of any applicable grace or cure periods;
(viii) Employer shall fail to pay
the principal of, or interest on, or to make any required payment
(regardless of amount) in connection with any of its indebtedness
when and as the same may become due and payable and such failure is
not cured or waived prior to the expiration of any applicable grace
or cure periods;
(ix) Any event or circumstance shall
have occurred the effect of which would permit the holder or
holders (or a trustee on its or their behalf) of any indebtedness
of Employer to cause or require such indebtedness to become due or
to be redeemed or repurchased prior to its stated maturity (or to
cause or require an offer to be made to effect such redemption or
repurchase) and such event or circumstance is not cured or waived
prior to the expiration of any applicable grace or cure periods;
or
(x) Employer and its subsidiaries,
if any, taken together, shall have failed to meet at least ninety
percent (90%) of their budget in any given fiscal year, as such
budget was recommended by the Chief Executive Officer and approved
by the Board of Directors.
No termination of Executive pursuant to any of
clauses (i), (iv), (v), or (vi) above will be effective unless and
until Executive has first been given written notice of the conduct
or circumstance purported to constitute “Cause”
thereunder and, unless such conduct or circumstance is not
reasonably susceptible of cure or such conduct or circumstance has
already been the subject of notice hereunder and cured by Executive
previously, Executive has failed to cure that conduct or omission
within thirty (30) days following receipt of that notice
by
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Executive. Any termination under any of clauses
(ii), (iii),
