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SEPARATION AND RELEASE AGREEMENT

Release Agreement

SEPARATION AND RELEASE AGREEMENT | Document Parties: Consumer Source Holdings Inc | Haas Publishing Companies, Inc You are currently viewing:
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Consumer Source Holdings Inc | Haas Publishing Companies, Inc

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Title: SEPARATION AND RELEASE AGREEMENT
Date: 8/8/2008
Industry: Printing and Publishing     Sector: Services

SEPARATION AND RELEASE AGREEMENT, Parties: consumer source holdings inc , haas publishing companies  inc
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Exhibit 10.4

SEPARATION AND RELEASE AGREEMENT

This Separation and Release Agreement (“Agreement”), dated as of May 27, 2008, is entered into by and between Robert Metz (“Metz”) and PRIMEDIA Inc. (together with its subsidiaries and affiliates, “PRIMEDIA”) (which, together with its successors, subsidiaries, officers, and directors (as of the date of this Agreement), are collectively referred to as the “Beneficiaries”).

WHEREAS, PRIMEDIA and Metz entered into a letter agreement regarding Metz’s employment with Consumer Source Holdings Inc. (formerly known as Haas Publishing Companies, Inc.), a subsidiary of PRIMEDIA, dated March 10, 2005 (the “Employment Letter Agreement”); and

WHEREAS, Metz’s employment with PRIMEDIA terminated, effective April 25, 2008 (the “Termination Date”), and is being treated as a termination without cause for purposes of the Employment Letter Agreement; and

WHEREAS, the Employment Letter Agreement requires that Metz enter into a separation and release agreement in the form customarily used by PRIMEDIA; and

NOW, THEREFORE, in consideration of the recitals, promises, and other good and valuable consideration specified herein, the receipt and sufficiency of which is hereby acknowledged, Metz and PRIMEDIA, on behalf of all the Beneficiaries, agree as follows:

 

 

1.

TERMINATION OF EMPLOYMENT.

Effective as of the Termination Date, Metz resigned from all positions held with PRIMEDIA, including all positions on the board of directors of PRIMEDIA and any committees thereof. The parties acknowledge that as of the Termination Date Metz incurred a “separation from service” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”).

 

 

2.

PAYMENTS AND BENEFITS

2.1 Payments . In accordance with the terms of the Employment Letter Agreement, subject in each case to the expiration of the Revocation Period (as defined in Section 3.2 below), PRIMEDIA will pay to Metz the amounts specified in this Section in consideration for Metz entering into this Agreement, specifically including the General Release (as described in Section 3 below) and other restrictive covenants identified herein:

(a) Base Salary Severance Payments . By no later than the sixtieth (60 th ) day following the Termination Date, PRIMEDIA will commence payment to Metz an aggregate amount equal to $787,500.00, which amount shall be payable in substantially equal bi-weekly installments, in accordance with PRIMEDIA’s regularly scheduled payroll dates, during the eighteen month period following the Termination Date, which amount represents eighteen months of Metz’s base salary at the annual rate in effect on the Termination Date ($525,000). For the avoidance of doubt, each bi-weekly payment referenced herein constitutes a separate payment for purposes of Section 409A.

(b) 2008 Pro Rata LTP Bonus Payment . PRIMEDIA will pay to Metz, in a lump sum, and in lieu of a prorated portion of the amount of the LTP bonus that would have been payable to Metz under the Long Term Compensation Program (the “LTCP”) in respect of 2008 if he had remained employed with PRIMEDIA through December 31, 2008 (the “LTP Bonus”), an aggregate amount equal to $74,155.00 (the “Pro Rata Bonus Amount”). PRIMEDIA will pay to Metz the Pro Rata Bonus Amount in calendar year 2009, but in no event later than March 31, 2009.


(c) Target Bonus Severance Payment . PRIMEDIA will pay to Metz, in a lump sum, an amount equal to $551,250.00, which amount represents the product of (x) 1.5 and (y) Metz’s target PRIMEDIA Executive Incentive Compensation Plan (the “EICP”) bonus as of the end of calendar year 2008 (equal to 70% of his annual rate of base salary as of the end of 2008). PRIMEDIA will pay to Metz this amount in calendar year 2009, but in no event later than April 15, 2009. Any other bonuses otherwise payable to Metz under the EICP in respect of any completed calendar years that remain unpaid as of the Termination Date shall be paid in full in accordance with the EICP.

2.2 Equity

(a) Stock Option . With respect to the outstanding options to purchase shares of common stock of PRIMEDIA (“Stock”) held by Metz as of the date hereof (the “Options”) that were granted to Metz prior to December 31, 2004, notwithstanding the provisions of any of the option award agreements pursuant to which Metz was granted such Options (as amended, if applicable, the “Option Agreements”), effective as of the Termination Date: (a) all of the Options that have not already vested as of the Termination Date shall remain outstanding and become vested on the last day of the eighteen month period following the Termination Date (the “Delayed Vesting Date”) and (b) all such Options shall thereafter be exercisable until the later of (i) the date such Options would have expired if they had been exercisable immediately following the Termination Date pursuant to the terms of the Option Agreements as in effect prior to the date of this Agreement and (ii) thirty (30) days after the Delayed Vesting Date. Except as set forth specifically herein, nothing in this Section 2.2(a) shall be construed to amend, alter, revise or change any other terms or conditions of the applicable Option Agreements (including, without limitation, PRIMEDIA’s right, in its sole discretion to accelerate the vesting of the Options and otherwise terminate such Options pursuant to the applicable PRIMEDIA Stock incentive plan under which the Options were granted).

(b) Restricted Stock . With respect to the restricted shares of Stock held by Metz as of the date hereof (the “Restricted Stock”) that were granted to Metz prior to December 31, 2004 and subject to Section 2.4 below, notwithstanding the provisions of any of the restricted stock award agreements pursuant to which Metz was granted such Restricted Stock (as amended, if applicable, the “Restricted Stock Agreements”), effective as of the Termination Date: the shares of such Restricted Stock that have not already vested as of the Termination Date shall remain outstanding and become vested on the Delayed Vesting Date (or such earlier date to which such vesting may be accelerated by PRIMEDIA in its sole discretion under the applicable PRIMEDIA Stock incentive plan under which the Restricted Stock were granted). Except as set forth specifically herein, nothing in this Section 2.2(b) shall be construed to amend, alter, revise or change any other terms or conditions of the applicable Restricted Stock Agreements.

2.3 Other Employee Benefits

(a) Group Health Coverage . Effective as of the Termination Date, Metz, his spouse and his eligible dependents may elect to receive group health benefit coverage from PRIMEDIA as permitted pursuant to the Consolidated Omnibus Reconciliation Act of 1985, as amended (“COBRA”), which coverage shall begin on the Termination Date and run through the period provided pursuant to COBRA. PRIMEDIA shall provide Metz with the required COBRA notice at such time as required under COBRA.

(b) Other Benefit Plans . Metz shall be entitled to all benefits that he has accrued or in which he has become vested under any tax-qualified retirement benefit plans maintained by PRIMEDIA in accordance with their terms.

 

2


2.4 Tax Withholding . PRIMEDIA may withhold from any amounts payable in cash under this Agreement such Federal, state and local income, employment and other taxes as may be required to be withheld in respect of any payment and/or any benefit provided for under this Agreement pursuant to any applicable law or regulation. Metz acknowledges that, simultaneously with the vesting of the Restricted Stock on the Delayed Vesting Date, Metz may be required to make arrangements with PRIMEDIA prior to such date for the payment of any such taxes as may be required to be withheld in respect of such vesting.

 

 

3.

RELEASES; METZ REPRESENTATIONS

3. 1 General Release .

For and in consideration of the payment of the amounts and the provision of the benefits described in Section 2 of this Agreement, Metz hereby agrees to execute a release of all claims against the Beneficiaries in the form attached as Exhibit I hereto (the “General Release”) on the date of execution of this Agreement.

3.2 Metz’s Representations and Warranties .

Metz represents that he has carefully read and fully understands the terms of this Agreement, and that Metz has been advised to consult with an attorney and has availed himself of the opportunity to consult with an attorney prior to signing this Agreement. Metz acknowledges and agrees that he is executing this Agreement willingly, voluntarily and knowingly, of his own free will, in exchange for the payments and benefits described in Section 2 of this Agreement, and that he has not relied on any representations, promises or agreements of any kind made to him in connection with his decision to accept the terms of this Agreement, other than those set forth in this Agreement. Metz further acknowledges, understands, and agrees that as of the Termination Date his employment with PRIMEDIA terminated, that the provisions of Section 2 of this Agreement are in lieu of any and all payments and benefits to which Metz may otherwise be entitled to receive pursuant to the Employment Letter Agreement, that Metz will not be reemployed by PRIMEDIA, and that Metz will not apply for or otherwise seek employment with PRIMEDIA or any of its parents, companies, subsidiaries, divisions or affiliates. Metz understands that, except as otherwise expressly provided for under this Agreement, he will not receive any payments or benefits under this Agreement until the seven (7) day revocation period provided for under the General Release has passed, and then, only if he has not revoked the General Release (such period during which no such revocation has occurred, the “Revocation Period”).

3.3 PRIMEDIA’s Representations and Warranties .

PRIMEDIA represents and warrants that, as of May 27, 2008, it is not aware of any claims that it has against Metz.

 

 

4.

WAIVER OF JURY TRIAL

TO THE FULLEST EXTENT PERMITTED BY LAW, EACH OF THE PARTIES HERETO HEREBY WAIVES THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF TH


 
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