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Exhibit 10.2
TERMINATION
AGREEMENT
AGREEMENT, dated as of
October 19, 2006, between INTEREP NATIONAL RADIO SALES, INC.,
New York corporation (the “Company”), and GEORGE E.
PINE (“Pine”).
W I T
N E S S E T
H:
WHEREAS, Pine has served the
Company as a member of its Board of Directors and, pursuant to an
Employment Agreement, dated as of March 19, 2003 (as amended
by Amendment No. 1 thereto, dated as of May 10, 2006, the
“Employment Agreement”), as its President and Chief
Operating Officer;
WHEREAS, the Company and Pine
wish to set forth their agreement as to the termination of
Pine’s employment;
NOW, THEREFORE, in
consideration of the premises and of the mutual agreements set
forth herein, the parties agree as follows:
1. Resignation and
Termination of Employment. Effective as of the date of this
Agreement (except as provided in Section 2(a)), Pine’s
employment with the Company shall terminate and Pine shall resign
from the offices of President and Chief Operating Officer, and from
all offices and directorships that he holds with any of the
Company’s subsidiaries or affiliates. Concurrently with the
execution of this Agreement, Pine has delivered to the Company a
signed letter of resignation to such effect.
2.
Payments.
(a) The period beginning on
September 1, 2006 and ending on May 31, 2009 is referred
to as the “Term”. During the Term, the Company shall
pay Pine severance compensation, as follows: (i) $615,000
during the first 12 months of the Term, of which $120,000 is being
paid on the date of this Agreement, (ii) $495,000 during the
second 12 months of the Term and (iii) $375,000 during the
last nine months of the Term, in each case less applicable federal
and state withholdings. Subject to the provisions of
Section 2(b), the Company shall pay such compensation in equal
semi-monthly installments. All of the compensation referred to in
this Section 2 shall be paid to Pine by direct deposit to such
account as Pine shall designate to the Company. In consideration of
the Company’s payment of such consulting and severance
compensation, Pine waives and forever forfeits any payments
otherwise payable to him under the Employment Agreement as salary,
bonus, severance compensation or otherwise.
(b) If a Change in Control
(as defined in Section 2(c)) occurs, Pine or his personal
representative (should he die or become incompetent during the
Term) shall have the right to require the Company, at any time
during the Term, and on not less than 30 days’ written notice
to the Company, to pay to Pine, his designee or his estate or heirs
an amount equal to all of the remaining severance compensation and
consulting fees payable to him during the then remainder of the
Term, discounted at the Discount Rate (as defined below) to its
present value as of the date of such notice (the “Notice
Date”). The Company shall pay such amount to Pine in a lump
sum not later than 30 days after the Notice Date. “Discount
Rate” means the yield to maturity, as determined on the
Notice Date, on U.S. Treasury obligations having a maturity date
then as near as possible to the last day of the Term.
(c) For purposes of this
Section 2, “Change in Control”, means the
occurrence of any of the following events:
(i) any “person,”
including a “group” (as such terms are used in Sections
13(d) and 14(d)(2) of the Securities Exchange Act of 1934 (the
“Exchange Act”), but excluding the Company, its
“Affiliates” (that is, any of its subsidiaries or any
parent corporation), or any employee benefit plan or employees of
the Company or any of its Affiliates, or any group of which any of
the foregoing is a member, is or becomes the “beneficial
owner” (as defined in Rule 13(d)(3) under the Exchange Act),
directly or indirectly, of the Company’s securities
representing 30% or more of the combined voting power of its then
outstanding securities;
(ii) during any period of 24
consecutive months, individuals (A) who on the date of this
Agreement constitute the Company’s entire Board of Directors
(“Initial Directors”) or (B) whose election,
appointment or nomination for election was approved prior to such
election or appointment by a vote of at least two-thirds of the
Initial Directors who were in office immediately prior to such
election or appointment, cease for any reason to constitute at
least a majority of the Company’s Board of
Directors;
(iii) the consummation of a
merger, business combination, share exchange, division or other
reorganization of the Company with any other corporation, where,
following such transaction, (A) a majority of the directors of
the surviving entity are persons who (I) were not members of
the Company’s Board of Directors immediately prior to the
merger or other combination and (II) are not the Company’s
nominees or representatives, (B) the Company’s
shareholders immediately prior to such merger or combination
beneficially own, directly or indirectly, less than 60% or more of
the combined voting power of the surviving corporation, as well as
60% or more of the total market value of its outstanding equity
securities, in substantially the same proportion as they owned the
combined voting power of the Company, (C) any
“person,” including a “group” (each as
defined in clause (i) above), but excluding the Company, its
Affiliates, or any of the Company’s or its Affiliates’
employee benefit plans or employees, or any group of which any of
the foregoing is a member, is or becomes the “beneficial
owner” (as defined in Rule 13(d)(3) under the Exchange Act),
directly or indirectly, of securities representing 30% or more of
the combined voting power of the surviving corporation or
(D) in the case of a division, the Company’s
shareholders immediately prior to such division beneficially own,
directly or indirectly, less than 60% or more of the combined
voting power of the outstanding voting securities of each entity
resulting from the division as well as 60% or more of the total
market value of each such entity’s outstanding equity
securities, in each case in substantially the same proportion as
such shareholders owned shares of the Company prior to such
transaction;
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(iv) the consummation of a
direct or indirect sale or other disposition of all or
substantially all of the Company’s assets;
(v) the Company’s
adoption of any plan of liquidation providing for the distribution
of all or substantially all of its assets;
(vi) any other change in
control of the Company of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of
Regulation 14A under the Exchange Act; or
(vii) any other event or
transaction that is declared by resolution of the Company’s
Board of Directors to be a Change in Control.
3. Plan Coverage. From
and after August 31, 2006 and until the earlier of
May 31, 2009 or such time as another employer makes available
to Pine medical and dental coverage comparable to that which the
Company currently provides to Pine, the Company shall provide,
under COBRA during the last 18 months of the Term and at its
expense during all of the Term, medical and dental coverage for
Pine under, and subject to the terms and conditions of, such group
insurance plans as the Company now and in the future makes
available generally for its employees. Nothing in this
Section 3 shall be construed to require the Company to
institute or maintain any or any particular benefit plan, program
or policy. If and to the extent that this Section 3 conflicts
with any COBRA notice or other document issued by the Company at
any time, the provisions of this Section 3 shall
prevail.
4. Certain Expenses.
Promptly after the date of this Agreement, the Company shall
reimburse Pine for his reasonable travel, lodging and entertainment
expenses incurred by him prior to the date hereof in connection
with the business of the Company, in accordance with the
Company’s policies and procedures. Pine may retain the
company cell phone, lap top and Blackberry that he has been using
and the Company shall continue to pay all related charges through
January 15, 2007; provided, however, that Pine shall
have access to, and use of, the Company’s e mail and voice
mail through January 15, 2007 and shall otherwise have no
access to the Company’s networks, systems or data through
such equipment on and after the date of this Agreement.
5. Other Benefit
Plans. Pine shall be entitled to receive all rights,
distributions and benefits which have accrued or shall accrue to
him under the Company’s Stock Growth Plan and 401-K Plan, in
accordance with the terms of such benefit plans. On and after the
date of this Agreement, the Company shall not make any further
contributions to any such benefit plan for Pine’s account and
all his benefit plan accounts shall be frozen with a review to roll
over or termination. The Company shall use its best efforts to
insure that all transfers of securities or accounts and payments of
cash contemplated in the preceding sentence are made as promptly as
is practicable, consistent with the terms and procedures of such
benefit plans. On and after the date of this Agreement, the Company
shall not make any further contributions to any such benefit plan
for Pine’s account and all his benefit plan accounts shall be
frozen with a view to roll-over or termination.
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6. Options. The stock
options held by Pine to purchase an aggregate of 107,240 shares of
Interep Common Stock shall remain exercisable on and after the date
of this Agreement, for the respective full terms thereof as stated
in the related option agreements and otherwise in accordance with
their terms.
7. Automobile
Allowance. The Company shall continue to provide Pine with the
use of the automobile it currently leases for him through the end
of the current lease on the same terms and conditions that are
currently applicable.
8. Statements. In any
written or oral discussion or disclosure by Pine or the Company
regarding the termination of Pine’s employment with the
Company, Pine and the Company shall each characterize such
termination as amicable and in a manner consistent with the
contents of this Agreement. Further, Pine shall not denigrate or
disparage the Company or any of its subsidiaries or divisions or
the businesses, services, officers, directors, employees, agents or
shareholders of any of them, or take any action which would tend to
cast any of them into disrepute. Similarly, the Company shall not
denigrate or disparage Pine or take any action which would tend to
cast him into disrepute. Pine shall maintain the existence and
terms of this Agreement in confidence at all times on and after the
date hereof; provided, however, that the foregoing shall not
restrict him from making any disclosure about the existence and
terms of this Agreement as may be required by applicable law or
from testifying truthfully pursuant to a
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