FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
Exhibit 10.2
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT (this “Amendment”) is entered into as of December 31, 2008 (the
“Effective Date”), by and between CUMULUS MEDIA INC., a corporation organized and existing under
the laws of the State of Delaware (hereinafter the “Company”) and XXXXX X. XXXXXX, XX., an
individual resident of the State of Georgia (hereinafter the “Executive”). Capitalized terms not
otherwise defined herein shall have the meaning set forth in the Agreement (as defined below).
RECITALS
WHEREAS, the Company and the Executive entered into a Third Amended and Restated Employment
Agreement dated December 20, 2006 (the “Agreement”); and
WHEREAS, the Company and the Executive believe it is in their best interest to amend the
Agreement in order to comply with Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”).
NOW, THEREFORE, the parties agree as follows:
AGREEMENT
| 1. | The following shall be added to the end of Section 5(b) of the Agreement: |
In no event shall any Annual Bonus pursuant to this Section 5(b) be
paid later than the fifteenth day of the third month after the end
of the Company’s fiscal year to which the Annual Bonus relates.
| 2. | Section 9(a)(ii) of the Agreement shall be deleted in its entirety and replaced with the following: |
(ii) SEVERANCE PAYMENT. The Company shall pay the Executive an
amount equal to two times the annual Base Salary in effect at the
time of termination. Any amount payable pursuant to this Section
9(a)(ii) shall be payable in four equal consecutive quarterly
installments, in accordance with Section 25.
| 3. | Section 9(c)(ii) shall be deleted in its entirety and replaced with the following: |
(ii) SALARY CONTINUATION. The Company shall provide the Executive
(or his legal representative) with a payment equal to the
Executive’s then-current annual Base Salary. Any amount payable
pursuant to this Section 9(c)(ii) shall be payable in four equal
consecutive quarterly installments, in accordance with Section 25.
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| 4. | The following shall be added to the end of Section 11(a) of the Agreement: |
Payment of the Gross-Up Payment, if any, shall be made no later than
the end of the Executive’s taxable year next following the
Executive’s taxable year in which the Executive remits the related
taxes. The Gross-Up Payment shall be reduced by the amount of any
other such gross-up payment made to the Executive pursuant to a
separate agreement or provision of any award which would be included
in the calculation of “parachute payments” described above, to avoid
the duplication of any gross-up payments.
| 5. | The following shall be added to the end of Section 23 of the Agreement: |
Such payment or reimbursement by the Company shall be subject to the
Reimbursement Rules.
| 6. | The following shall be added to the Agreement as Section 24: |
24. REIMBURSEMENT RULES. The “Reimbursement Rules” means
the requirement that any amount of expenses eligible for
reimbursement under this Agreement be made (i) in accordance with
the reimbursement payment date set forth in the applicable provision
of this Agreement providing for the reimbursement or (ii) where the
applicable provision does not provide for a reimbursement date,
thirty (30) calendar days following the date on which the Executive
incurs the expenses, but, in each case, no later than December 31 of
the year following the year in which the Executive incurs the
related expenses; provided, that in no event shall the
reimbursements or in-kind benefits to be provided by the Company in
one taxable year affect the amount of reimbursements or in-kind
benefits to be provided in any other taxable year, nor shall the
Executive’s right to reimbursement or in-kind benefits be subject to
liquidation or exchange for another benefit. Notwithstanding the
foregoing, all reimbursements relating to the Additional Delayed
Payments (as hereinafter defined) shall be made on the Permissible
Payment Date (as hereinafter defined).
| 7. | The following shall be added to the Agreement as Section 25: |
25. SECTION 409A OF THE CODE.
(a) Notwithstanding any provisions of this Agreement to the
contrary, if the Executive is a “specified employee” (within the
meaning of Section 409A of the Code and determined pursuant to
procedures adopted by the Company) at the time of his separation
from service and if any portion of the payments or benefits to be
received by the Executive upon separation from service would be
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considered deferred compensation under Section 409A of the Code,
amounts that would otherwise be payable pursuant to this Agreement
during the six-month period immediately following the Executive’s
separation from service (the “Delayed Payments”) and benefits that
would otherwise be provided pursuant to this Agreement (the “Delayed
Benefits”) during the six-month period immediately following the
Executive’s separation from service (such period, the “Delay
Period”) shall instead be paid or made available on the earlier of
(i) the first business day of the seventh month following the date
of the Executive’s separation from service or (ii) Executive’s death
(the applicable date, the “Permissible Payment Date”). The Company
shall also reimburse the Executive for the after-tax cost incurred
by the Executive in independently obtaining any Delayed Benefits
(the “Additional Delayed Payments”).
(b) Each payment under this Agreement shall be considered a
“separate payment” and not of a series of payments for purposes of
Section 409A of the Code.
(c) Any Delayed Payments shall bear interest at the United States
5-year Treasury Rate plus 2%, which accumulated interest shall be
paid to the Executive on the Permissible Payment Date.
(d) A termination of employment shall not be deemed to have occurred
for purposes of any provision of this Agreement providing for the
payment of any amounts or benefits subject to Section 409A of the
Code upon or following a termination of employment unless such
termination is also a “separation from service” (within the meaning
of Section 409A of the Code).
| 8. | The Agreement is hereby deemed to be further amended as necessary to conform it to the terms of this Amendment. All other provisions of the Agreement, except as specifically amended herein, remain in full force and effect and are incorporated herein. | |
| 9. | This Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. |
[Signatures appear on following pages]
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IN WITNESS WHEREOF, the parties have executed and delivered this Amendment as of the Effective
Date.
| CUMULUS MEDIA INC. |
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| By: | /s/ Xxxxxxx X. Xxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxx | |||
| Title: | Vice President | |||
| /s/ Xxxxx X. Xxxxxx, Xx. | ||||
| Xxxxx X. Xxxxxx, Xx. | ||||
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