Exhibit 10.1
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
     THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (“Agreement”) is made as of
April 6, 2009, effective April 1, 2009, by and between Spanish Broadcasting
System, Inc., a corporation existing under the laws of Delaware with offices
located at 2601 S. Bayshore Drive, PH2 Coconut Grove, Florida 33133 (the
“Company”) and Frank Flores (“Employee”), an individual whose principal place of
residence and current mailing address is 461 First Street, Oradell, New Jersey
07649.
RECITALS
          WHERAS, the Company and Employee entered into a written employment
agreement on or about July 16, 2007 (the “2007 Employment Agreement”);
          WHEREAS, the Company is the owner and/or operator of certain
Spanish-language radio stations serving the metropolitan New York, New York area
(the “NY Stations”) and throughout the United States and Puerto Rico
(collectively, the “Stations”);
          WHERAS, the Company wishes to engage Employee and Employee wishes to
become engaged to perform services for the Company as Chief Revenue Officer of
the Stations and General Manager of the NY Stations during the Term (as defined
herein), pursuant to the terms and conditions set forth in this Agreement; and
          WHEREAS, the Company and Employee agree that this Amended and Restated
Employment Agreement replaces and voids in all respects all terms and conditions
set forth in the 2007 Employment Agreement.
          NOW THEREFORE, in consideration of the promises and the mutual
covenants contained herein, the parties understand and agree as follows:
     1. Employment. Employee shall be employed to perform services as Chief
Revenue Officer for the Stations and General Manager for the NY Stations during
the Term (as defined herein). Employee will render such services solely and
exclusively for the Company and devote Employee’s full business time, energy and
ability to the Company and faithfully and diligently promote the business
affairs and interests of the Company. Employee shall report to and be directed
by the Company’s Chief Executive Officer or his/her designee. Employee’s
services will be rendered subject to and in accordance with the policies,
controls, rules and procedures of the Company. During the Term, Employee’s
services shall be rendered at the Company’s New York office. Although Employee’s
primary responsibility will be to provide his services in New York, New York,
Employee will be required to travel to the Stations from time to time, to
perform services in such other locations, or areas as directed by the Company,
provided that the Company will not require Employee to relocate his domicile for
these purposes.

 

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     2. Specific Duties and Services. Employee shall perform services as Chief
Revenue Officer for the Stations and General Manager for the NY Stations as such
term is commonly defined in the industry, when representing the Company or the
Company Entities (as defined herein) to the best of his ability and perform such
managerial and operational services, as are customarily rendered by persons
engaged in the same or a similar capacity in the radio and entertainment
industry and such other services as the Company may reasonably require from time
to time. During the Term, in addition to Employee’s duties as set forth herein,
Employee shall be responsible for: (i) overseeing and managing all aspects of
the Stations’ revenue growth, including local and national sales, (ii) meeting
or exceeding national and local sales goals as may be set forth by the Company
from time to time, (iii) increasing station operating income and top line
growth, and fostering new business development, (iv) overseeing the NY Stations’
day to day operations and maintaining managerial control of the NY Stations
including, but not limited, to managing broadcast cash flow in accordance with
the Company’s goals and objectives, (v) taking all reasonable and necessary
steps to protect the Stations’ broadcast licenses, and (vi) using his best
efforts to make the Company the most respected broadcasting company. Further,
Employee agrees to comply with the Company’s policies standards of professional
conduct, and comply with the Company’s instructions, directions, requests, rules
and procedures.
     3. Term. On the terms and subject to the conditions set forth in this
Agreement, the Company hereby employs Employee and Employee hereby accepts such
employment for the period commencing on April 1, 2009 and ending on March 31,
2012, unless terminated earlier in accordance with the provisions of this
Agreement (the “Term”). For purposes of this Agreement, the Term and any
additional period, if any, are collectively referred to as the “Term”.
     4. Exclusivity.
          (a) Prohibited Activities. Without the prior express written consent
of the Company, which consent may be withheld or rescinded at any time in the
sole discretion of the Company, Employee will not, directly or indirectly,
either individually or as an employee, agent, partner, joint venture
shareholder, consultant, officer, director or in any other capacity: (i) render
services to any other person or entity, except to a charitable organization for
no consideration and then only to the extent it does not interfere with the
business interests of the Company and the performance by Employee of Employee’s
obligations under this Agreement; or (ii) participate, engage in or have any
financial or other interest in any business which is competitive in any manner
whatsoever with any business in which the Company or any of its affiliates is
now or may hereafter become engaged. The foregoing prohibition does not include
ownership by Employee of less than five percent (5%) of the outstanding shares
of any publicly-traded entity, provided that Employee does not otherwise
participate in such entity as a director, officer, employee or in any other
capacity.
          (b) Agreement to Employ; No Conflicts. Employee represents and
warrants to the Company that (a) he is entering into this Agreement voluntarily
and that his employment hereunder and compliance with the terms and conditions
hereof will not conflict with or result in the breach by his of any agreement to
which he is a party or by which he may be bound, (b) he has not, and in
connection with his employment with the Company will not, violate any non-
competition, non-solicitation or other similar covenant or agreement by which he
is or may be bound, (c) he has no outstanding commitments inconsistent with any
of the terms of this Agreement or the services to be rendered by Employee
hereunder, and (d) in connection within his employment with the Company he will
not use any confidential or proprietary information he may have obtained in
connection with employment with any prior employer.

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     5. Compensation and Benefits.
          (a) Base Salary. In consideration for the obligations by the parties
hereunder and in consideration for Employee’s acceptance of the Restrictive
Period (as defined herein), the Company shall pay Employee a base salary (“Base
Salary”) as set forth on the Compensation Rider attached hereto as Exhibit A and
made a part hereof. Employee’s Base Salary shall be paid in accordance with the
payroll policies of the Company from time to time in effect, less such amounts
as may be required to be withheld by applicable federal, state and local law and
regulations.
          (b) Bonus. See Compensation Rider Exhibit A attached hereto and made a
part hereof.
          (c) Benefits. See compensation Rider Exhibit A attached hereto and
made a part hereof.
     6. Covenants.
          (a) Acknowledgment. Employee agrees and acknowledges that in the
course of rendering services to the Company and its clients and customers he has
acquired and will acquire access to and become acquainted with confidential
information about the professional, business and financial affairs of the
Company, its parent, subsidiaries and affiliates that is non-public,
confidential or proprietary in nature. Employee acknowledges that the Company is
engaged in a highly competitive business and the success of the Company in the
marketplace depends upon its goodwill and reputation for quality and
dependability. Employee agrees and acknowledges that reasonable limits on his
ability to engage in activities competitive with the Company are warranted to
protect its substantial investment in developing and maintaining its status in
the marketplace, reputation and goodwill. Employee recognizes that in order to
guard the legitimate interests of the Company, it is necessary for it to protect
all confidential information. The existence of any claim or cause of action by
Employee against the Company shall not constitute and shall not be asserted as a
defense to the enforcement by the Company of this Agreement. Employee further
agrees that his obligations of this Section 6 shall be absolute and
unconditional.

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          (b) Restrictive Covenant. During the Term and for a period of six
(6) months after the end of the Term (the “Restrictive Period”), Employee shall
not render services in any capacity, including but not limited to rendering
services as on-air talent, host, producer of radio, satellite radio, or
television programs, program director, program executive or consultant, for any
“Competitive Business,” which shall include, but shall not be limited to any
radio station, radio network, satellite radio, or broadcast television station,
television network, cable station, cable programming network, satellite station,
satellite programming network or internet website (i) in any area in which SBS
owns, leases or programs a radio or television station, at any time during
Employee’s employment with SBS (the “Territory”) and (ii) that broadcasts or
transmits its on-air content primarily in the Spanish-language. Competitive
Business shall also include satellite, cable and Internet radio and television
providers. It is specifically understood by Employee that SBS, the SBS Stations
and SBS-affiliated television facilities or stations, if any, within the
Territory are intended beneficiaries of the restrictive covenants contained in
this Section. The parties agree that it will be deemed a violation of this
section for Employee to render services, directly or indirectly, to any company
that is in the business of owning, leasing or programming radio stations that
broadcast primarily in the Spanish language, if Employee’s duties or activities
include responsibility for or relate in any significant manner to one or more of
that company’s stations that are competitive with one or more of the SBS
Stations.
          (c) Non-Solicitation or Interference. During the Term and the
Restrictive Period, Employee shall not, in any capacity, whether for his own
account or on behalf of any other person or organization, directly or
indirectly, with or without compensation interfere with the operation of the
Company’s business, including without limitation by: (i) soliciting, diverting,
inducing or encouraging any officers, directors, employees, agents, consultants,
former customer, representatives or any other person or concern, dealing with or
in any way, directly or indirectly, associated with the Company or its parents,
subsidiaries, affiliate and/or divisions (the “Company Entities”) to terminate
her, his or its relationship with the Company or the Company Entities, (ii)
hiring any such officer, director, employee, agent, consultant, former customer,
representative or any other person or concern so solicited, diverted, induced or
encouraged, (iii) soliciting, diverting, inducing or encouraging any officers,
directors, employees, agents, consultants or representatives of the Company or
the Company Entities, to become officers, directors, employees, agents,
consultants, customers, representatives or any other person or concern, of
another business, enterprise or entity, (iv) soliciting, diverting or
appropriating any customers, clients, vendors or distributors of the Company or
the Company Entities, or (v) influencing or attempting to influence any of the
customers, clients, vendors, distributors or business partners of the Company or
the Company Entities, to transfer her, his or its business or patronage from the
Company or the Company Entities to any Competitor of the Company or the Company
Entities.

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          (d) Confidential Information. During and at all times after the Term,
Employee shall keep secret this Agreement, all non-public information, matters
and materials of the Company or the Company Entities, including, but not limited
to, know-how, trade secrets, mail order and customer lists, pricing policies,
operational methods, any information relating to the Company or the Company
Entities, products or product development, processes, product specifications and
formulations, artwork, designs, graphics, services, budgets, business and
financial plans, marketing and sales plans and techniques, employee lists and
other business, financial, commercial and technical information presently owned,
or at any time in the future developed by the Company or the Company Entities,
its agents, or consultants, actually or potentially used in the operation of the
Company’s business, or obtained from third parties under an agreement of
confidentiality (collectively, the “Confidential Information”), to which he has
had or may have access and shall not use or disclose such Confidential
Information to any person other than (i) the Company, its authorized employees
and such other persons to whom Employee has been instructed to make disclosure
by the Company, in each case only to the extent required in the course of
Employee’s service to the Company or as otherwise expressly required in
connection with court process, (ii) as may be required by law and then only
after consultation with the Company to the extent possible, or (iii) to
Employee’s personal advisors for purposes of enforcing or interpreting this
Agreement, or to a court for the purpose of enforcing or interpreting this
Agreement, and who in each case have been informed as to the confidential nature
of such Confidential Information and, as to advisors, their obligation to keep
such Confidential Information confidential. “Confidential Information” shall not
include any information which is in the public domain during the period of
service of Employee, provided such information is not in the public domain as a
consequence of disclosure by Employee in violation of this Agreement or by any
other party in violation of a confidentiality or non-disclosure agreement with
the Company. Upon termination of Employee’s employment for any reason, or
whenever requested by the Company, Employee shall promptly deliver to the
Company any and all Confidential Information, and all copies thereof, including
but not limited to, documents, data, papers and records of any nature and in any
medium (including, but not limited to, electronic media) in his possession or
subject to his control that (i) belong to the Company or the Company Entities or
(ii) contain or reflect any information concerning the Company, the Company
Entities and affiliates. Employee hereby acknowledges that the sale or
unauthorized use, duplication or disclosure of any Confidential Information by
any means whatsoever and any time before, during or after employment with the
Company shall constitute a material breach of this Agreement and unfair
competition; and Employee agrees not to engage in unfair competition either
during the time employed by the Company or at any time thereafter in perpetuity.
          (e) Non-Disparagement. In consideration of Company’s obligations
hereunder, during the Term and the Restrictive Period, Employee shall not
directly or indirectly (i) engage in any conduct or make any statement, whether
in commercial or non-commercial speech, disparaging or criticizing in any way
the Company, the SBS Entities or any affiliate, executive officers, directors or
employees of any of the foregoing entities, or any products or services offered
by any of these entities, or (ii) engage in any other conduct or make any other
statement, in each case, which could be reasonably expected to (x) impair the
goodwill or reputation of the foregoing entities or individuals or (y) the
reputation of any of the foregoing entity’s products or services or the
marketing of any of the foregoing entity’s products or services, except to the
extent required by law and then only after consultation with the Company to the
extent possible, or in connection with any dispute between Employee and any of
the foregoing entities.

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          (f) Company’s Right of First Refusal to Match Competing Offer. Without
compromising in any way the Company’s rights under this Section 6 or under law,
the Company shall have a right of first refusal to match all bona fide competing
offers (and if Employee shall be ready, willing, and able to accept such
competing offer) for Employee’s services at any non-Company radio station
wherever located (“Competing Offers”) after the expiration or early termination
of this Agreement. No fewer than forty-five days (45) prior to the expiration of
this Agreement, but in any event no fewer than thirty (30) days before
employment of Employee contemplated by a Competing Offer is to commence
(“Commencement Date”), Employee shall provide to the Company written
notification of the terms and conditions of such Competing Offers, including a
true copy of the actual Competing Offer. No fewer than thirty (30) days prior to
the expiration of this Agreement or fifteen (15) days before the Commencement
Date, whichever is later, the Company shall provide to Employee written
notification of whether it intends to match the material terms of each and every
bona fide competing offer. If the Company declines to match the material terms
of a bona fide Competing Offer, Employee shall be free to accept that competing
offer and to begin employment, but only after the time periods as described in
Section 6(b) have expired. The right of first refusal contained in this Section
6(f) shall not apply to any conduct other than the performance of “services” as
defined in Section 1, above.
          (g) Employee Fidelity. Employee agrees that during the Term, Employee
will not, directly or through third-party intermediaries, initiate or invite
contact with, or solicit or entertain offers or proposals of employment from
Competitors wherever located. Employee expressly acknowledges that (i) he will
immediately notify the Company of any such communications and (ii) a breach of
this covenant of fidelity shall constitute grounds for termination for Cause
under Section 10.
          (h) Remedies for Breach; Injunctive Relief. The Company and Employee
agree that the restrictive covenants contained in this Agreement are severable
and separate, and the unenforceability of any specific covenant herein shall not
affect the validity of any other covenant set forth herein. Employee
acknowledges that by virtue of his position with the Company, Employee will be
given access to the Company’s and the Company Entities’ trade secrets and
Confidential Information. Employee acknowledges that the Company will suffer
irreparable harm as a result of a breach of such restrictive covenant by
Employee for which an adequate monetary remedy does not exist and a remedy at
law may prove to be inadequate. Accordingly, in the event of any actual or
threatened breach by Employee of any provision of this Agreement, the Company
shall, in addition to any other remedies permitted by law, be entitled to obtain
remedies in equity, including, but not limited to, specific performance,
injunctive relief, a temporary restraining order, and/or a preliminary and/or
permanent injunction in any court of competent jurisdiction, to prevent or
otherwise restrain a breach of this Section 6 without the necessity of proving
damages, posting a bond or other security, and to recover any and all costs and
expenses, including reasonable counsel fees, incurred in enforcing this
Agreement against Employee, and Employee hereby consents to the entry of such
relief against his and agrees not to contest such entry. Such relief shall be in
addition to and not in substitution of any other remedies available to the
Company. The existence of any claim or cause of action of Employee against the
Company, whether predicated on this Agreement or otherwise, shall not constitute
a defense to the enforcement by the Company of said covenants. Employee shall
not defend on the basis that there is an adequate remedy at law. In addition to
and not in lieu of any other remedy that the Company may have under this
Section 6 or otherwise, in the event of any breach of any provision of this
Section 6 during the period during which Employee is entitled to receive
payments and Benefits pursuant to Section 10, such period shall terminate as of
the date of such breach and Employee shall not thereafter be entitled to receive
any salary or other payments or Benefits under this Agreement.

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          (i) Modification and Survival. Employee hereby agrees that each
provision in this section shall be treated as a separate and independent clause,
and the unenforceability of any one clause shall in no way impair the
enforceability of any of the other clauses herein. The parties agree and
acknowledge that the duration, scope and geographic area of the covenants
described in this Section 6 are fair, reasonable and necessary in order to
protect the Confidential Information, goodwill and other legitimate interests of
the Company and that adequate consideration has been received by Employee for
such obligations. Employee further acknowledges that after termination of his
employment with the Company for any reason, he will be able to earn a livelihood
without violating the covenants described in this Section 6 and Employee’s
ability to earn a livelihood without violating such covenants is a material
condition to his employment with the Company. If, however, for any reason any
court of competent jurisdiction determines that the restrictions in this
Section 6 are not reasonable, that consideration is inadequate or that Employee
has been prevented unlawfully from earning a livelihood, such restrictions shall
be interpreted, modified or rewritten to include the maximum duration, scope and
geographic area identified in this Section 6 as will render such restrictions
valid and enforceable. It is the intent of the parties that this section be
enforced to the greatest extent allowable in law or equity. The terms of this
Section 6, shall survive the termination or expiration of Employee’s employment
and this Agreement, but only to the extent of the time limitations as set forth
herein.
     7. Proprietary Rights.
          (a) Property Rights; Intellectual Property. All audio and/or video
broadcasts, air checks, recordings, streamings or transmissions, prerecorded or
otherwise, whether by radio, television, Internet, satellite, cable, cellular
telephony, or other electronic media whether now existing or hereafter developed
of the programming of the Company or the Company Entities commercials, data,
copy, written and recorded materials, as well as all recordings, documents,
notes, sales and marketing strategies, projections, forecasts and presentations,
sales and revenue projections or estimates, if applicable, created by Employee
at any time during the Term or any extension thereof, including without
limitation the Employee’s work product, are works for hire and shall be the
exclusive property of the Company, and the Company Entities throughout the
Universe, in perpetuity (the “Property Rights”). The Company and the Company
Entities own or shall own all right, title and interest throughout the Universe,
in any of Employee’s and the Company’s and the Company Entities work product and
all copyright, trademark and other intellectual property rights in and related
thereto throughout the Universe, in perpetuity (“Intellectual Property”),
including but not limited to, the right to syndicate all or part of Employee’s
program in any media whether now existing or hereafter developed without any
additional compensation to Employee. Material, characters, personalities and
skits created by or for Employee during her/her employment with the Company may
only be used by Employee during the Term or any extension thereof for the
benefit of the Company, although the Company, as owner of the Work Product,
Property Rights and Intellectual Property, may use them in any manner at any
time in the Company’s sole and absolute discretion. All documents or other
tangible property and concepts or inventions, including Internet, television,
and other electronic media, relating in any way to the business of the Company
or the Company Entities which are conceived or generated by Employee or come
into Employee’s possession during or by virtue of his employment with the
Company shall be and remain the property of the Company and the Company
Entities. Employee must return all such documents and tangible property to the
Company on termination of this Agreement for any reason or at such earlier time
as the Company may request in writing.

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          (b) Works Made for Hire. Employee acknowledges and agrees that
Employee is and has been retained by the Company to create work product and on a
work-made-for-hire basis for the Company. In this regard, the Company, and not
Employee, is the sole and exclusive owner of authorship and ownership of all
right, title and interest in and to any part of the work product, and any
portion of the fruit, proceeds, lay-outs, story boards, slogans, designs,
flow-charts, etc., created, written, developed, finished, produced, disclosed or
acquired by Employee, alone or in collaboration with others, during Employee’s
employment by the Company (collectively, the “Work Product”) and any portion of
the Intellectual Property are deemed to vest in or be owned by the Company as a
work-made-for-hire or by operation of law or otherwise. Notwithstanding the
foregoing, upon the termination of the Agreement or earlier termination, the
Company has the right to use any Work Product, Property Rights, and Intellectual
Rights in perpetuity and throughout the Universe. Insofar as the authorship and
ownership of all right, title and interest in and to any part of the Work
Product and any portion of the Intellectual Property are not deemed to vest in
or be owned by the Company as a work-made-for-hire or by operation of law or
otherwise, Employee agrees to and hereby does assign, sell, transfer, grant and
convey to the Company (without the necessity of any further consideration,
documentation or further acts by either party) the entirety of whatever right,
title and interest Employee has in the Intellectual Property throughout the
Universe. At the Company’s request, Employee shall execute any documents
reasonably required by the Company to confirm, establish, record, file
applications for, renew or maintain the Company’s rights and ownership in the
Intellectual Property worldwide and will cooperate fully with the Company in
connection with any or all of these efforts. The Work Product constitutes “work
made for hire” as such term is defined in Section 101 of the U.S. Copyright Act
of 1976 (17 U.S.C. §101), as amended, such that all copyrights in such work
product, in any and all media and through all forms of communication or
transmission, whether presently known or hereafter developed, are the exclusive
property of the Company. If, for any reason, the Work Product does not qualify
as “work made for hire,” Employee is deemed to have hereby irrevocably sold,
assigned and transferred to the Company all such copyrights.

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     8. Name and Likeness.
     Employee hereby grants to the Company, its affiliates, licensees and
distributors the irrevocable license throughout the Universe, (whether this
Agreement expires in its normal course or is terminated for any reason
whatsoever), which license is exclusive during the Term and non-exclusive in
perpetuity, to use, simulate and portray in any and all media, whether now known
or hereafter developed, including, without limitation the Internet, Employee’s
likeness, photograph, name, voice and other personal identification and
biography in connection with advertising, publicizing and otherwise exploiting
the Company’s and its affiliates’ programming incorporating the services of
Employee and promoting the Company’s business generally, including, without
limitation, in connection with the Company’s and its affiliates’ Internet
activities. The foregoing right shall include, without limitation, the right to
use such likeness in photographs, drawings, computer-generated graphic images
and other personal likeness and identification.
     This Section 8 is not intended to alter, comprise or limit in any way SBS’
Property Rights or Intellectual Rights as stated in Section 7 above.
     9. Compliance with the Communications Act of 1934, et. al.
          (a) Section 508 of the Communications Act of 1934. Employee shall
comply with the provisions of Section 508 of the Communications Act of 1934, as
amended, in that he will not accept money or any valuable consideration,
including services, for the broadcast of any matter by the Stations and in that
he will promptly complete the Annual Statement and Questionnaire and promptly
return it to the Company. Without limiting the Company’s right to terminate for
any other cause, the Company shall have the right, upon violation of this
provision by Employee, immediately to terminate this Agreement and Employee’s
employment hereunder for cause.
          (b) Conflicts of Interest. Employee represents and warrants that
Employee is familiar with the provisions of Sections 317 and 507 of the
Communications Act of 1934, as amended, recognizes Employee’s responsibilities
and personal liabilities thereunder, and will fully comply with those provision
during the Term. Specifically, Employee will not, without the prior knowledge
and written consent of the Company in each instance: (a) engage in any business
or economic activity that would create a conflict of interest in the selection
of broadcast matter, (b) accept any favors, loans, entertainment or anything of
value from persons seeking the airing of any matter in return therefore, or
(c) promote over the air any activity or matter in which Employee or any
affiliate of Employee has a direct or indirect financial interest. Employee will
provide the Company with such information and execute such certifications as the
Company may from time to time reasonably require to enable the Company to
discharge its obligations under the above-referenced statutory provisions.
     10. Termination. This Agreement and Employee’s employment by the Company
will terminate on the earlier of (i) the expiration of the Term or (ii) the
first to occur of any of the following:

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          (a) Death. Upon the death of Employee.
          (b) Failure to Render Service. In the event Employee fails for a
period of four (4) consecutive weeks or for a total of eight (8) weeks in any
one-year period, as a result of illness, incapacity, injury, disability from a
physical or mental condition, or by reason of any statute, law, ordinance,
regulation, order, judgment or decree.
          (c) For Cause. The Company may terminate Employee’s employment
hereunder at any time, effective immediately for Cause (as defined below) and
all of the Employee’s rights to payments (other than salary payments for
services already rendered and expenses incurred through the date of such
termination) and any other Benefits otherwise due hereunder shall cease
immediately. For purposes of this Agreement the term “Cause” includes, but is
not limited to: (i) refusal or unwillingness to perform duties; (ii) habitual
neglect of duties which Employee is required to perform; (iii) failure of
Employee to perform all duties and obligations of Employee in a manner which is
satisfactory to the Company; (iv) willful misconduct or gross negligence;
(v) theft, fraud or other illegal conduct; (vi) sexual or other unlawful
harassment; (vii) conduct which reflects adversely upon the Company, any
affiliate of the Company, or any officer, director, management, employees,
advertisers, clients, agents or any of them, including, without limitation,
broadcasting, publishing or making derogatory statements, disparaging remarks or
personal attacks against the Company, including but not limited to, its officers
and directors, management, employees, advertisers or any of its policies or
procedures; (viii) arrest for or conviction of a crime involving moral
turpitude; (ix) insubordination; (x) any willful act that is likely to or does
in fact have the effect of injuring the reputation, business or a business
relationship of the Company, any affiliate of the Company, or any officer,
director or board of directors of any of them; (xi) violation of any fiduciary
duty or duty of loyalty; (xii) failure to perform any reasonable duties assigned
to Employee by the Chief Executive Officer or his/her respective designees;
(xiii) failure to follow any the Company or its Parent operating or personnel
policies and practices (Employee acknowledges having read and understood the
Employee Handbook); (xiv) failure to comply with any rule, regulation, guideline
or policy of the FCC or other governmental agency with jurisdiction over the
Company; (xv) repeated or sustained absence from the Station (not due to a
disability or an the Company approved vacation or other absence or leave);
(xvi) engaging in “payola” or “plugola” practices; (xvii) use of illegal drugs
or alcohol at any time on any property owned or leased by the Company or any the
Company Station; (xviii) failure to meet three or more consecutive quarterly
sales budgets; (xix) broadcasting or transmitting, or allowing the broadcast or
transmission, of any obscene, prurient, indecent or highly inappropriate
material, including the posting of any such obscene, prurient, indecent or
inappropriate material on any website associated with the Company or the Company
Entities that has the effect of injuring third parties or subjecting SBS to
public ridicule or liability; or (xx) failure to comply with any of the terms
and conditions of this Agreement. Termination of Employee’s employment under
this Section 10 will not limit the Company’s rights and remedies against
Employee under this Agreement, at law or in equity.

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          (d) Without Cause. The Company, in its absolute discretion, may
terminate Employee’s employment at any time without Cause (as defined below) for
any reason and with or without notice. Effective as of the date of the
termination of Employee’s employment pursuant to this Section 10(d), Employee’s
right to receive Base Salary, Benefits, expense reimbursement and other amounts
(such as bonuses) will cease, provided that the Company will pay Employee such
amounts, if any, which Employee has earned but are unpaid. In the event
Employee’s employment is terminated pursuant to this Section 10(d), the Company
will pay Employee three (3) month’s Base Salary after the date of such
termination in accordance with the Company’s payroll policies. Such payment will
be in lieu of all other rights of Employee under this Agreement, at law or in
equity, except as provided in the first sentence of this Section 10(d). The
payment described in this section 10(d) is intended to meet the exception to
deferred compensation for purpose of section 409A of the Internal Revenue Code
of 1986 (the “Code”) as involuntary separation pay within the meaning of
Treasury Regulation 1.409A-1(b)(9)(iii). This Agreement shall be administered
and construed consistent with this intent.
          (e) Release. Notwithstanding the foregoing, and subject to Employee’s
compliance with the conditions of Section 6, in order to be eligible for any
payments hereunder, Employee must (i) execute and deliver to the Company a full
general release of all claims, including but not limited to claims in connection
with Employee’s employment or the termination thereof, in a form reasonably
satisfactory to the Company, and (b) as determined by the Company, must be and
remain in compliance in all material respects with his material obligations
under this Agreement, including, but not limited to, those obligations set forth
in Section 6. In the event the Company determines, with notice to Employee, that
Employee has materially breached his obligations hereunder, including those
obligations set forth in Section 6, any and all payments or Benefits provided
for in Section 10(d) shall cease immediately.
          (f) Post Termination Conditions. Upon termination of Employee’s
employment with or without Cause, Employee agrees that he will cooperate with
and assist the Company with any litigation, contract negotiation or other matter
in which the benefit of Employee’s knowledge or expertise may be requested by
the Company, including without limitation, assisting the Company, at the
Company’s sole request, in the preparation of litigation (including testifying).
     11. Customers, Suppliers. Employee does not have, and at any time during
the Term shall not have, any employment with or any direct or indirect interest
in (as owner, partner, shareholder, employee, director, officer, agent,
consultant or otherwise) any customer of or supplier to the Company or the
Company Entities.
     12. Certain Activities. During the Term, Employee shall not (a) give or
agree to give, any gift or similar benefit of more than nominal value to any
customer, supplier, or governmental employee or official or any other person who
is or may be in a position to assist or hinder the Company or the Company
Entities in connection with any proposed transaction, which gift or similar
benefit, if not given or continued in the future, might adversely affect the
business or prospects of the Company or the Company Entities, (b) use any
corporate or other funds for unlawful contributions, payments, gifts or
entertainment, (c) make any unlawful expenditures relating to political activity
to government officials or others, (d) establish or maintain any unlawful or
unrecorded funds in violation of Section 30A of the Securities Exchange Act of
1934, as amended, and (e) accept or receive any unlawful contributions,
payments, gifts, or expenditures.

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     13. Miscellaneous.
          (a) Withholding. All compensation payable hereunder shall be subject
to applicable taxes, withholding, premium charges, co-payment of Benefits,
self-insured retentions and other normal deductions.
          (b) Notice. Any notice or other communications hereunder shall be in
writing and shall be deemed to have been duly given (i) when delivered
personally, (ii) upon confirmation of receipt when such notice or other
communication is sent by facsimile, (iii) one day after delivery to an overnight
delivery courier (i.e., Federal Express), or (iv) on the fifth day following the
date of deposit in the United States mail if sent first class, postage prepaid,
by registered or certified mail. The addresses for such notices shall be as
follows (or any other such address as one party may specify by notice to the
other):

     
As to the Company:
  Spanish Broadcasting System, Inc.
 
  c/o 2601 South Bayshore Drive, PH II
 
  Coconut Grove, Florida 33133
 
  Attn: Melanie Montenegro, Esq.
 
  Facsimile: (786) 470-1732
 
   
As to Employee:
  Frank Flores
 
  461 First Street
 
  Oradell, NJ 07649

          (c) Conformity to Law. If any one or more provisions of this Agreement
should ever be determined to be illegal, invalid, or otherwise unenforceable by
a court of competent jurisdiction or be invalid or invalidated or unenforceable
by reason of any law or statute, then to the extent and within the jurisdiction
invalid or unenforceable, it shall be limited, construed or severed and deleted
therefrom, and the remaining portions of this Agreement shall survive, remain in
full force and effect, and continue to be binding and shall not be affected and
shall be interpreted to give effect to the intention of the parties insofar as
that is possible.
          (d) Attorney’s Fees. In the event that any action is brought to
enforce any of the provisions of this Agreement, or to obtain money damages for
the breach thereof, and such action results in the award of a judgment for money
damages or in the granting of any injunction in favor of one of the parties to
this Agreement, all expenses, including reasonable attorneys’ fees, shall be
paid by the non-prevailing party.
          (e) Severability. If any portion of this Agreement is held invalid or
inoperative, the other portions of this Agreement shall be deemed valid and
operative and, so far as is reasonable and possible, effect shall be given to
the intent manifested by the portion held invalid or inoperative.
          (f) Headings. The Headings used in this Agreement are for the
convenience of the parties and for reference purposes only and shall not form a
part of or affect the interpretation of this Agreement.

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          (g) Construction. This Agreement shall be construed without regard to
any presumption or other rule requiring construction against the party causing
this Agreement to be drafted, since the attorneys for the respective parties
have submitted revisions to the text hereof.
          (h) Entire Agreement. This Agreement shall constitute the entire
agreement concerning the subject matter hereof between the parties, superseding
all previous agreements, memoranda of understanding, negotiations, and
representations made prior to the effective date of this Agreement.
          (i) Amendment; Waiver. This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms hereof may be waived,
only by a written instrument executed by the parties hereto or, in the case of a
waiver, by the party waiving compliance. The failure of either party at any time
or times to require performance of any provision hereof shall in no manner
affect the right at a later time to enforce the same. No waiver by either party
of the breach of any term or covenant contained in this Agreement, whether by
conduct or otherwise, in any one or more instances, shall be deemed to be, or
construed as, a further or continuing waiver of any such breach, or a waiver of
the breach of any other term or covenant contained in this Agreement.
          (j) Successors and Assigns. This Agreement shall be binding upon
Employee, without regard to the duration of his employment by the Company or
reasons for the cessation of such employment, and inure to the benefit of his
administrators, executors, heirs and assigns, although the obligations of
Employee are personal and may be performed only by her. The Company may assign
this Agreement and its rights, together with its obligations, hereunder. This
Agreement shall also be binding upon and inure to the benefit of the Company and
its subsidiaries, successors and assigns.
          (k) Governing Law. The validity of this Agreement, its interpretation
and any disputes arising from, or relating in any way to, this Agreement or the
relationship of the parties, shall be governed by the law of the State of New
York without regard to conflicts of law principles.
          (l) Arbitration. Any controversy, dispute or claim between the parties
to this Agreement, including without limitation any claim arising out of, in
connection with, or in relation to the formation, interpretation, performance or
breach of this Agreement shall be settled exclusively by arbitration before a
single arbitrator, in accordance with this Section and the American Arbitration
Association (“AAA”) National Rules for the Resolution of Employment Disputes.
The parties agree, notwithstanding the AAA rules regarding discovery, that each
party shall have the right to propound requests for discovery of documents shall
have the right to conduct up to three (3) depositions, and additional
depositions, provided the arbitrator consents to such additional depositions
upon the party’s request. Judgment upon any award rendered by the arbitrator may
be entered by any state or federal court having jurisdiction thereof. The
parties acknowledge that by agreeing to arbitration pursuant to this Section,
they are waiving their right to a judicial forum, except as set forth below in
this Section, and to a trial by jury.

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          Arbitration shall be the exclusive remedy for determining any such
dispute, regardless of its nature. Notwithstanding the foregoing, any party may
in an appropriate matter apply to a court pursuant to New York Code of Civil
Procedure, or any comparable provision, for provisional relief, including a
temporary restraining order or a preliminary injunction, on the ground that the
award to which the applicant may be entitled in arbitration may be rendered
ineffectual without provisional relief.
          This agreement to resolve any disputes by binding arbitration shall
extend to any claims by or against any parent, subsidiary, counsel or affiliate
of each party, and officer, director, shareholder, employee or agent of each
party, or of any of the above, and shall apply as well as to claims arising
under the common law. In the event of a dispute subject to this Section, the
parties shall be entitled to reasonably discovery related to the claim that is
the subject of the dispute, subject to the discretion of the arbitrator and
pursuant to the applicable AAA rules.
          Any filing or administrative fee shall be initially advanced by the
party commencing the arbitration subject to reallocation by the arbitrator. The
prevailing party in such arbitration, as determined by the arbitrator, and in
any enforcement or other court proceedings, shall be entitled, to the extent
permitted by law, to reimbursement from the other party for all of the
prevailing party’s costs, expenses, and attorney’s fees.
          The arbitrator shall render an award and written opinion explaining
the basis for the award. The award of the arbitrator shall be final and binding
upon the parties. If any of the provisions of this Section or of this Agreement
are determined to be unlawful or otherwise unenforceable, in whole or in part,
such determination shall not affect the validity of the remainder of this
Agreement, and this agreement shall be reformed to the extent necessary to carry
out its provisions to the greatest extent possible and to insure that the
resolution of all conflicts between the parties, including those arising out of
statutory claims, shall be resolved by neutral, confidential, binding
arbitration.
          Unless mutually agreed by the parties otherwise, any arbitration shall
take place in New York County, New York.
          (m) Counterparts. This Agreement may be executed simultaneously in one
or more counterparts, each of which shall be deemed to be an original copy of
this Agreement and all of which together shall constitute one and the same
instrument.
          (n) Translation of Agreement. In the event that this Agreement is
translated into any language other than the English language, the original
English-language version of this Agreement, in both form and substance, will
govern this transaction in all respects, notwithstanding that the
English-language version of this Agreement is not executed by either or both of
the respective parties.
[remainder of page intentionally left blank]

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     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first written above.

            SPANISH BROADCASTING SYSTEM , INC.
      By:   /s/ Joseph A.Garcia         Name:   Joseph A. Garcia        Title:  
Sr. EVP     

            EMPLOYEE
      /s/ Frank Flores       Frank Flores           

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EXHIBIT A
COMPENSATION RIDER
Frank Flores
     (a) Base Salary: Effective April 1, 2009 and each year thereafter during
the Term, the Company shall pay Employee an annual base salary of $250,000,
payable bi-weekly (“Base Salary”), in accordance with the payroll policies of
the Company from time to time in effect, less such amounts as may be required to
be withheld by applicable federal, state and local law and regulations.
     (b) NY Stations Consolidated Station Operating Income Year-End Bonus.
Employee shall be eligible to receive a year-end bonus equal to the percentages
specified below only if the NY Stations consolidated station operating income
(“NY Stations Consolidated SOI”) (as defined below) reach the respective SOI
target. Such year-end bonus shall be payable if at all, 60 days after the end of
the then current calendar year.
NY Stations Consolidated SOI Bonus Incentive (year-end)

                          SOI Target       %       Year-End Bonus Amount
Equal to or greater than $22M but less than $23M
  x     .283 %   =   $65,000 (maximum)
Equal to or greater than $23M but less than $24M
  x     .391 %   =   $ 90,000  
Equal to or greater than $24M but less than $25M
  x     .4 %   =   $ 100,000  
Equal to or greater than $25M but less than $26M
  x     .48 %   =   $ 125,000  
Equal to or greater than $26M but less than $27M
  x     .55 %   =   $ 150,000  
Equal to or greater than $27M but less than $28M
  x     .625 %   =   $ 175,000  
Equal to or greater than $28M but less than $29M
  x     .689 %   =   $ 200,000  
Equal to or greater than $29M
  x     .75 %   =   Uncapped

For the purposes of this Agreement “NY Stations Consolidated SOI” shall mean the
NY Stations consolidated station operating income before depreciation and
amortization, and gain (loss) on the sale of assets and excluding stock based
compensation expense, as certified by the CFO.
For the avoidance of doubt and by way of example, if the NY Stations
Consolidated SOI is:

  i.   less than $22 million, then Employee is not eligible to receive a
year-end bonus;     ii.   equal to $22.5 million, then Employee is eligible to
receive a year-end bonus as follows: $22.5 million x 0.283% = $63,675;     iii.
  equal to $28 million, then Employee is eligible to receive a year-end bonus as
follows: $28 million x 0.689% = $192,920; or     iv.   equal to $34 million,
then Employee is eligible to receive a year-end bonus as follows: $34 million x
0.75% = $255,000.

 

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     (c) Consolidated Stations SOI Year-End Bonus. Employee shall be eligible to
receive a year-end bonus equal to 0.4545% only if the Consolidated Stations SOI
(as defined below) is $55.0 million or more. Such Stations consolidated year-end
SOI bonus will be payable if at all, 60 days after the end of the then current
calendar year.
For the purposes of this Agreement “Consolidated Stations SOI” shall mean the
Company’s radio stations consolidated SOI before depreciation and amortization,
and gain (loss) on the sale of assets and excluding stock based compensation
expense, as certified by the CFO.
For the avoidance of doubt and by way of example, if the Consolidated Stations
SOI is:

  i.   less than $55 million, then Employee is not eligible to receive a
year-end bonus;     ii.   equal to $55 million, then Employee is eligible to
receive a year-end bonus as follows: $55 million x 0.4545% = $250,000; or    
iii.   equal to $60 million, then Employee is eligible to receive a year-end
bonus as follows: $60 million x 0.4545% = $272,700.

     (d) Bonuses Not Cumulative. The bonuses referred to in paragraphs (b) and
(c) herein above are mutually exclusive and are not cumulative.
     (e) Parking Automobile Allowance. In addition to Employee’s Base Salary and
any respective bonus, if any, as set forth herein, the Company shall reasonably
pay or reimburse Employee for one parking spot near the NY Station.

                  Company Initials: /s/ JAG                           Employee
Initials: /s/ FF