Exhibit 10.1
Execution Copy
EMPLOYMENT AGREEMENT
This Agreement (“Agreement”) is entered into by and between Gary Schonfeld
(“Employee”) and Westwood One, Inc. (the “Company”).
1. Employment. The Company hereby employs Employee, and Employee accepts such
employment, and agrees to devote Employee’s full time and efforts to the
interests of the Company upon the terms and conditions hereinafter set forth.
2. Term of Employment. Subject to the provisions for termination hereinafter
provided, Employee’s term of employment by the Company shall commence on
October 20, 2008 (the “Effective Date”), and shall continue in effect until the
first anniversary thereof (the “Term”). If either party desires not to extend
this Agreement, it shall deliver written notice to the other party on or prior
to the 45th day immediately preceding the expiration of the Term of its
intention to terminate this Agreement effective on the last day of the Term.
Unless otherwise terminated pursuant hereto, if Employee continues to be
employed by the Company after the Term, then Employee’s employment shall be
deemed to continue until such time as either party shall deliver written notice
to the other party and this Agreement shall terminate forty five (45) days after
the giving of such notice. The period from the Effective Date through the last
day of Employee’s employment with the Company is referred to as the “Employment
Period.”
3. Services to be Rendered by Employee.
(a) During the Employment Period, Employee shall serve as President, Network
Division, and shall be based out of the Company’s New York office. Employee
shall perform such duties as from time to time may be delegated to Employee and
will continue to perform duties as requested by the Board of Directors of the
Company (the “Board”), the Chief Executive Officer, the President of the Company
or any designee that is a member of the Board, any committee of the Board or any
executive officer of the Company. Employee shall devote all of Employee’s
professional time, energy and ability to the proper and efficient conduct of the
Company’s business. Employee shall observe and comply with all reasonable lawful
directions and instructions by and on the part of the Board, the Chief Executive
Officer, the President of the Company or any designee that is a member of the
Board, any committee of the Board or any executive officer of the Company, and
endeavor to promote the interests of the Company and not at any time do anything
which may cause or tend to be likely to cause any loss or damage to the Company
in business, reputation or otherwise.
(b) The Company may from time to time call on Employee to perform services
related to the business of developing and broadcasting network and syndicated
radio programming and traffic, news, sports and weather reports, which may
include (in the Company’s sole discretion) contributing to the day-to-day
management and operation of such business, soliciting Sponsors and Affiliates
(as such terms are defined in Section 11 hereof), or dealing with their accounts
or other activities related to the Company’s business, as reasonably requested
from time to time by the Chief Executive Officer, the Board or their designee.

 

 

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(c) Employee acknowledges that Employee will have and owe fiduciary duties to
the Company and its shareholders including, without limitation, the duties of
care, confidentiality and loyalty.
(d) EMPLOYEE ACKNOWLEDGES THAT EMPLOYEE HAS RECEIVED A COPY OF THE COMPANY’S
SEXUAL HARASSMENT POLICIES AND PROCEDURES, CODE OF ETHICS AND CODE OF CONDUCT,
AND UNDERSTANDS AND AGREES TO ABIDE BY SUCH POLICIES.
4. Compensation.
(a) Base Salary. For the services to be rendered by Employee during the
Employment Period, the Company shall pay Employee, and Employee agrees to accept
a monthly base salary (the “Base Salary”) of $41,666.66 for the Employment
Period, payable in accordance with the Company’s normal payroll practices.
(b) Discretionary Bonus. Employee shall be eligible for an annual discretionary
bonus valued at up to $500,000 (prorated for any partial calendar years) in the
sole and absolute discretion of the Compensation Committee of the Board (the
“Compensation Committee”) or its designee. The Company may use Employee’s and
the Company’s achievement of financial goals as general guidelines to determine
Employee’s eligibility for a discretionary bonus. Any cash component of any
bonus will be no less than 75% of the bonus and will be payable in accordance
with the Company’s normal payroll practices in the year following the year for
which it is earned, but no later than April 30 of the calendar year subsequent
to which such bonus is earned. Employee shall not be eligible for any bonus for
a calendar year, pro-rated or otherwise, if Employee is not an Employee of the
Company: (i) at the end of the applicable calendar year; (ii) on the date such
bonus is paid; except, that, in the event Employee is terminated without Cause
or Employee terminates employment for Good Reason after the end of the
applicable calendar year but before the time such bonus is paid, Employee shall
remain eligible for such bonus or (iii) if Employee has materially breached this
Agreement, which breach remains uncured in accordance with Section 6(a) hereof.
If the Agreement is terminated due to the expiration of the Term in accordance
with Section 2 hereof (i.e., on October 20, 2009), the Employee shall be
eligible for a discretionary bonus for the portion of the Term during which
Employee has been employed by the Company but for which Employee has not been
paid, which, subject to the Company’s customary policies and guidelines with
respect to such bonus, shall be paid to Employee in a lump sum at the time such
discretionary bonuses are paid to executives of the Company; provided, that,
Employee has not materially breached this Agreement, which breach remains
uncured in accordance with Section 6(a) hereof.
(c) Equity Compensation. The Compensation Committee has granted Employee an
award, to be effective on October 20, 2008, of equity compensation in the form
of stock options to purchase 550,000 shares of Company common stock conditioned
upon Employee’s commencement of employment with the Company on the Effective
Date. Such stock options shall vest in three equal installments on each
anniversary of the Effective Date, subject to the terms and conditions of the
Company’s applicable equity compensation plan pursuant to which such stock
option grant is made. The exercise price of such stock options will be the
closing price of the Company’s common stock on the Effective Date. In the event
that the stock option grant provided hereunder is made pursuant to the Company’s
1999 Stock Incentive Plan, as amended (the “SIP”), Section 8.3 of the SIP shall
not apply.

 

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(d) Benefits. During the Employment Period, Employee shall accrue vacation on a
monthly basis and at a rate of four (4) weeks per year (pro-rated for partial
years). Except as expressly set forth herein, any vacation time shall be subject
to prevailing practice and/or policies of the Company in regard to vacations for
its employees. Employee shall be entitled to participate in all benefits plans
that may be established by the Company for employees, subject to the terms and
conditions of such plans.
(e) Total Compensation. Employee agrees and acknowledges by his signature hereto
that the compensation set forth in this Agreement constitutes all of the
compensation payable to Employee for his services hereunder and that no other
compensation shall be due to Employee hereunder.
5. Expenses. Subject to compliance by Employee with such policies regarding
expenses and expense reimbursement as may be adopted from time to time by the
Company, the Company shall reimburse Employee, or cause Employee to be
reimbursed, in cash for all reasonable expenses in accordance with the Company’s
reimbursement policy as in effect from time to time.
6. Termination of Employment.
(a) During the Employment Period, the Company shall have the right to terminate
the employment of Employee hereunder immediately by giving notice thereof to
Employee if any of the following has occurred, which notice shall state with
particularity the circumstances or events constituting Cause (each, a “Cause
Event”); provided, that, in the case of clauses (i) through (iii) of this
Section 6(a), Employee shall be given a reasonable opportunity to cure, but in
no event more than ten (10) business days, to the extent such act or failure to
act is curable:
(i) if Employee has (A) failed, refused or habitually has neglected to carry out
or to perform the reasonable duties required of Employee hereunder or otherwise
materially breached any provision of this Agreement (other than Sections 7, 8 or
10 hereof, which are governed by Section 6(a)(iii) hereof), (B) willfully
breached any statutory or common law duty; (C) breached Section 3(c) or 3(d) of
this Agreement; or (D) violated any of the Company’s internal policies or
procedures.
(ii) if Employee is convicted of, or enters into a plea of nolo contendere or
guilty to, a felony or a crime involving moral turpitude or if Employee has
willfully engaged in conduct which would injure the reputation of the Company in
any material respect or otherwise adversely affect its interests in any material
respect if Employee were retained as an employee of the Company;
(iii) if Employee breaches any of the provisions of Sections 7, 8 or 10 hereof
or breaches any of the terms or obligations of any other non-competition and/or
confidentiality agreements entered into between Employee and the Company, or the
Company’s Related Entities, if any;

 

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(iv) if Employee commits an act of fraud, misrepresentation or dishonesty, or
steals or embezzles assets of the Company; or
(v) if Employee engages in a conflict of interest or self-dealing.
(b) Employee’s employment with the Company shall automatically terminate
(without notice to Employee’s estate) upon the death of Employee. Employee’s
employment with the Company may be terminated upon ten (10) day’s prior written
notice by the Company to Employee upon Employee’s Disability. For purposes of
this Agreement, the term “Disability” means Employee’s inability, by reason of
physical disability or other incapacity (as may be defined in applicable
disability insurance policies), to carry out or to perform the duties required
of Employee hereunder for a continuous period of 90 days or for a non-continuous
period of 120 days in the aggregate in any 365-day period; provided, however,
that Employee’s compensation during any period in which Employee is unable to
perform the duties required of Employee hereunder shall be reduced in accordance
with the Company’s policies and by any disability payments (excluding any
reimbursements for medical expenses and the like) which Employee is entitled to
receive under group or other disability insurance policies of the Company during
such period.
(c) In the event of any termination of Employee’s employment by the Company,
Employee (or Employee’s estate, as the case may be) shall be entitled to
receive: (i) the Base Salary herein provided prorated to the date of termination
paid in accordance with the Company’s normal payroll practices, (ii) subject to
the terms of Section 5 and 17 hereof, reimbursement for any business expenses
properly incurred and paid by Employee prior to and including the date of
termination, (iii) Employee’s then current entitlement, if any, under the
Company’s employee benefit plans and programs, including payment for any accrued
and unused vacation paid or provided in accordance with the terms and conditions
of the applicable plan or program and (iv) no other compensation. The parties
agree that the payments set forth in this Section 6(c) constitute all of
Company’s obligations, monetary or otherwise, to Employee under the terms of
this Agreement in the event of Employee’s termination pursuant to Section 6(a)
or 6(b). Additionally, if Employee is terminated pursuant to Section 6(a), all
of Employee’s equity compensation (including, without limitation, any granted
pursuant to this Agreement or otherwise), vested and unvested, shall terminate
and expire, except in the case of vested stock options which Employee has
exercised prior to the date of termination (for the avoidance of doubt, all
vested equity compensation (except for stock options which have been exercised)
shall be forfeited in the event of a termination pursuant to Section 6(a)).
Notwithstanding the foregoing, in the case of a termination pursuant to Sections
6(d) or 6(e), additional payments shall be due as expressly set forth below.

 

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(d) The Company may terminate Employee’s employment hereunder during the Term
effective at any time upon written notice to Employee. In the event that during
the Term the Company terminates Employee’s employment other than pursuant to
Section 6(a) or 6(b) or Employee elects to terminate his employment for Good
Reason as expressly described in Section 6(e) below (subject in all cases to
Employee’s executing and providing to the Company within 60 days following the
date of termination a fully effective waiver and general release substantially
in the form attached as Exhibit A hereto, which may be modified for changes in
law and for consistency with the Company’s standard form required for other
senior officers of the Company from time to time, which the Company shall
provide to the Employee within seven (7) days following the effective date of
termination), (x) the Company shall pay Employee the remaining Base Salary due
to Employee through the end of the Term (the “Termination Amount”), to be paid
in equal payments over the remainder of the Term on a schedule that mirrors the
Company’s then effective payroll practices; provided, however, that the
six-month delay set forth in Section 17(b) shall apply to the Termination Amount
to the extent it exceeds the Separation Pay Limit (as defined in Section 17(b))
and that to the extent the Termination Amount does not exceed the Separation Pay
Limit, the first payment of the Termination Amount shall be made on the first
Company payroll date on or after the 60th day after the date of termination,
which first payment shall include payment of any amounts that would otherwise be
due prior thereto and (y) if Employee is terminated upon or within twenty-four
(24) months following a Change in Control (as defined below) of the Company, all
outstanding equity awards held by Employee shall become fully vested and
immediately exercisable and shall remain exercisable in accordance with the
terms and conditions of the applicable equity plan and award agreements under
which they were granted. For the avoidance of doubt, it is understood and agreed
that notwithstanding anything contained herein to the contrary, Employee shall
have no duty to mitigate in the event that Company exercises its rights pursuant
to this Section 6(d). To the extent the Company requests assistance or
information from Employee pursuant to the waiver and general release described
in this section of the Agreement, the Company will reimburse Employee for all
reasonable expenses relating to reasonable travel, postage, courier, telephone,
fax and similar direct expenses within 60 days of Employee submitting to the
Company any reasonable documentation, including receipts, which the Company may
reasonably request. For purposes of clarity, to the extent the Company requests
assistance or information from Employee pursuant to the waiver and general
release described in this section of the Agreement, the Company shall not
reimburse or pay Employee for Employee’s time or lost wages or legal counsel
fees related to Employee’s fulfillment of Employee’s obligations under this
section of the Agreement.
(e) Provided the Company has not notified Employee that he is being terminated
pursuant to Sections 6(a) and 6(b) hereof, Employee may terminate his employment
hereunder effective at any time upon written notice to the Company for Good
Reason, provided such notice is given to the Company within thirty (30) days
after the triggering event and such event is not cured by the Company within
30 days after its receipt of such notice. For purposes hereof, “Good Reason”
shall mean the occurrence of one of the following: (i) a material diminution in
Employee’s authority or responsibilities; or (ii) a material diminution in
Employee’s Base Salary.
7. No Conflict of Interest; Proper Conduct.
(a) (a) (x) During the Term and in any event, not less than ninety (90) days
after the Employment Period if Employee is terminated pursuant to Sections 6(a)
or 6(b)(other than in the case of Employee’s death) or (y) during the Employment
Period and for an additional period equal to the time period during which
Employee is paid severance by the Company after the Employment Period if
Employee is terminated pursuant to Sections 6(d) or 6(e) (notwithstanding the
foregoing, such period described in this Section 7(a)(y) shall not be less than
ninety (90) days nor greater than one (1) year), Employee will not, directly or
indirectly, either individually or as a stockholder (except as a stockholder of
less than one percent (1%) of the issued and outstanding stock of a
publicly-held corporation whose gross assets exceed $100,000,000), investor,
officer, director, member, employee, agent, trustee, associate or consultant of
any Person:
(i) compete with the Company in any business in competition with that then
carried on by the Company and/or its Related Entities;
(ii) engage in or carry on any Restricted Activities;

 

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(iii) employ or offer to employ or solicit employment of any employee or
consultant of the Company or its Related Entities; provided, however, that the
restrictions in this section 7(a)(iii) shall not apply to general solicitations
that are not specifically directed to employees of the Company or its Related
Entities; or
(iv) solicit (or assist or encourage to solicit), divert or attempt to divert
any business, patronage or customer (including known prospects) of the Company
or its Related Entities to Employee or a competitor or rival of the Company or
its Related Entities.
(b) Employee further agrees that he shall not, without the Company’s prior
written consent, engage in any activity during the Employment Period that would
conflict with, interfere with, impede or hamper the performance of Employee’s
duties for the Company or would otherwise be prejudicial to the Company’s
business interests. Employee shall not commit any act or become involved in any
situation or occurrence that, in the Company’s reasonable judgment, could tend
to bring Employee or the Company into public disrepute, contempt, scandal or
ridicule, could provoke, insult or offend the community or any group or class
thereof, or could reflect unfavorably upon the Company or any of its Sponsors or
Affiliates. Employee shall comply with all applicable laws and regulations
governing the Company and its business, including without limitation,
regulations promulgated by the Federal Communications Commission or any other
regulatory agency. The parties hereto agree that the remedy at law for any
breach of Employee’s obligations under this Section 7 or Section 8 (Confidential
Information and the Results of Services) of this Agreement would be inadequate
and that any enforcing party shall be entitled to injunctive or other equitable
relief (without bond or undertaking) in any proceeding which may be brought to
enforce any provisions of this Section 7 or Section 8. Resort to such equitable
relief, however, shall not constitute a waiver of any other rights or remedies
which the Company may have.
8. Confidential Information and the Results of Services. Employee acknowledges
that the Company has established a valuable and extensive trade in the services
it provides, which has been developed at considerable expense to the Company,
and expects to divulge to Employee certain Confidential Information and trade
secrets relating to the Company’s business, provide information relating to the
Company’s customer base and otherwise provide Employee with the ability to
injure the Company’s goodwill unless certain reasonable restrictions are imposed
upon Employee which are contained in this Section 8. Employee agrees that, by
virtue of the special knowledge that Employee has received and will receive from
the Company, and the relationship of trust and confidence between Employee and
the Company, Employee has or will have certain information and knowledge of the
operations of the Company that are confidential and proprietary in nature,
including, without limitation, information about Affiliates and Sponsors.
Employee agrees that during the Employment Period and thereafter, Employee will
not make use of or disclose, without the prior consent of the Company,
Confidential Information relating to the Company or any of its Related Entities
(including, without limitation, its Sponsor lists, its Affiliate/station lists,
its technical systems, its contracts, its methods of operation, its business
plans and opportunities, its strategic plans and its trade secrets), and
further, that Employee will return to the Company at the end of the Employment
Period all written materials in Employee’s possession embodying such
Confidential Information.

 

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9. Work for Hire. Employee agrees that any ideas, concepts, discoveries,
techniques, patents, copyrights, trademarks or computer programs relating to the
business or operations of the Company and its Related Entities which are
developed or discovered by Employee, solely or jointly with others, during the
Employment Period, shall be deemed to have been made within the scope of
Employee’s employment and therefore constitute works for hire and shall
automatically upon their creation become the exclusive property of the Company.
Employee agrees to promptly notify and fully disclose the existence of such
works to the Company. To the extent such items are not works for hire under
applicable law, Employee assigns them and any and all intangible proprietary
rights relating thereto to the Company in their entirety and agrees to execute
any and all documents necessary or desired by the Company to reflect the
Company’s ownership thereof.
10. Communications Act of 1934. Employee represents and warrants that neither
Employee nor, to the best of Employee’s knowledge, information and belief, any
other individual, has accepted or agreed to accept, or has paid or provided or
agreed to pay or provide, any money, service or any other valuable
consideration, as defined in Section 507 of the Communications Act of 1934, as
amended, for the broadcast of any matter contained in programs. Employee further
represents and warrants that during the Employment Period Employee shall comply
with all legal requirements set forth herein.
11. Certain Definitions. As used in this Agreement, the following capitalized
terms have the meanings indicated:
Affiliates. Any Person with whom the Company has or had a contract or other
arrangement to provide network and/or syndicated radio programming.

 

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Change in Control. Such meaning set forth in the Company’s 2005 Equity
Compensation Plan, as may be amended from time to time (the “Equity Plan”),
provided, however, that for purposes of this Agreement and the benefits to which
Employee would be entitled under Section 12 of the Equity Plan, clause (i) of
said definition shall be modified to read as follows: “(i) the acquisition by
any Person (as hereinafter defined) of 50% or more of the outstanding Shares
(the “Outstanding Company Stock”) (other than an acquisition by the Company or
any employee benefit plan (or related trust) sponsored or maintained by the
Company or any Person that controls, is controlled by or is under common control
within the Company or other than a Non-Qualifying Business Combination (as
defined below));”
Confidential Information. Information obtained by Employee during the Employment
Period which concerns the affairs of the Company or its Related Entities and
which the Company has requested be held in confidence or could reasonably be
expected to desire to be held in confidence, or the disclosure of which would
likely be embarrassing, detrimental or disadvantageous to the Company or its
Related Entities and including the terms of this Agreement. Confidential
Information shall include the information described in Section 8 as well as
works for hire as described in Section 9 hereof, however, it shall not include
information which Employee can demonstrate to be: (i) information that is at the
time of receipt by Employee in the public domain is known to Employee or is
otherwise generally known in the industry or subsequently enters the public
domain or becomes generally known in the industry through no fault of Employee
or (ii) information that at any time is received in good faith by Employee from
a third party which to Employee’s knowledge was lawfully in possession of the
same and had the right to disclose the same. Notwithstanding any provision to
the contrary contained herein, the terms of this Agreement may be disclosed to
Employee’s legal, financial and tax advisors and any members of Employee’s
immediate family, which for purposes hereof shall include Employee’s spouse,
parents, children, siblings, grandparents, grandchildren, mother-in-law and
father-in-law.
Person. Any individual, corporation, partnership, joint venture, limited
liability partnership or limited liability company, trust, unincorporated
organization, association or other entity.
Related Entity or Related Entities. Any Person that directly or indirectly
controls, is controlled by, or is under common control with the Company (or its
successor or assign), including but not limited to Westwood One Radio Networks,
Inc., Westwood One Radio, Inc., Metro Networks Communications, Inc. and Metro
Network Communications, Limited Partnership. As used in this definition, the
term “control” means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
Restricted Activities. Any of the following: (i) providing services to a
traffic, news, sports, weather or other information report gathering or
broadcast service or to a radio network or syndicator, or any direct competitor
of the Company or its Related Entities; (ii) soliciting Sponsors and dealing
with accounts with respect to the immediately preceding clause (i); (iii)
soliciting Affiliates to enter into any contract or arrangement with any Person
to provide the information set forth in clause (i); or (iv) forming or providing
operational assistance to any business or a division of any business engaged in
the foregoing activities.

 

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Sponsor(s). Any and all client advertisers of the Company (including its
subsidiaries and Affiliates) including without limitation advertisers whose
commercial material is to be, is or was incorporated in any one or more of the
Company’s programs or announcements, live or recorded, broadcast over the
facilities of the Company, by the Company, or pursuant to an arrangement with an
affiliated station, broadcaster or transmitter of the Company’s programming.
12. Choice of Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT, SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW.
13. Arbitration. The parties hereby agree that any and all claims or
controversies relating to Employee’s employment with the Company, or termination
thereof, including but not limited to claims for breach of contract, tort,
unlawful discrimination or harassment (including any claims arising under Title
VII, the Americans with Disabilities Act, and the Age Discrimination in
Employment Act), and any violation of any local, state or federal law
(“Arbitrable Claims”), except for any equitable relief sought by a party, shall
be resolved by arbitration before a single arbitrator in accordance with the
then applicable JAMS Employment Arbitration Rules And Procedures. However,
claims under applicable workers’ compensation laws or the National Labor
Relations Act shall not be subject to arbitration. Arbitration under this
Agreement shall be the exclusive remedy for all Arbitrable Claims and shall be
final and binding on all parties. Unless the parties mutually agree otherwise,
the arbitrator shall be selected from a panel provided by JAMS and the
arbitration shall be held in New York County, New York, and the arbitrator shall
be directed to issue a reasoned opinion within 30 days of the close of the
hearing. Any court having jurisdiction thereof may enter judgment on the award
rendered by the arbitrator(s). THE PARTIES HEREBY WAIVE ANY RIGHTS THEY MAY HAVE
TO A TRIAL BY JURY OF ANY MATTERS SUBJECT TO ARBITRATION UNDER THIS AGREEMENT.
The prevailing party in any arbitration brought under the terms hereof, shall be
entitled to request reimbursement of reasonable attorney’s fees and expenses.
14. Assignment. Subject to the provisions of 6(d)(y) and 11 hereof, the
Company’s 2005 Equity Compensation Plan and any other applicable plans or
agreements concerning a Change in Control, the rights of the Company hereunder
may, without the consent of Employee, be assigned by the Company to any Related
Entity or successor of the Company or any entity which acquires all or
substantially all of the Company’s assets. Except as provided in the preceding
sentence, the Company may not assign all or any of its rights, duties or
obligations hereunder without the prior written consent of Employee. This
Agreement is not assignable by Employee.
15. Merger or Reorganization. Subject to the provisions of 6(d)(y) and 11
hereof, the Company’s 2005 Equity Compensation Plan and any other applicable
plans or agreements concerning a Change in Control, in the event of any merger,
consolidation, dissolution or reorganization of the Company (including but not
limited to any reorganization where the Company is not the surviving or
resulting entity), or any transfer of all or substantially all of the assets of
the Company, the provisions of this Agreement shall inure to the benefit of and
shall be binding upon the surviving or resulting partnership or the corporation
(or other entity) or person(s) to which such assets shall be transferred.

 

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16. Remedies. Except as it may elect otherwise, the Parties shall have all
rights, powers or remedies provided by law or equity for breach of this
Agreement available to it, it being understood and agreed that (i) no one of
them shall be considered as exclusive of the others or as exclusive of any other
rights, powers and remedies allowed by law and (ii) with respect to Employee,
Employee’s rights under this section 16 are limited to breaches involving
failures by the Company to make payments under the terms of this Agreement. The
exercise or partial exercise of any right, power or remedy shall neither
constitute the election thereof nor the waiver of any other right, power or
remedy. Without limiting the generality of the foregoing, Employee agrees that,
in addition to all other rights and remedies available at law or in equity, the
Company shall be entitled to enforcement of this Agreement in accordance with
the principles of equity (without bond or undertaking), the remedy at law being
hereby agreed and acknowledged by Employee to be inadequate.
17. Section 409A of the Code.
(a) Although the Company does not guarantee the tax treatment of any particular
payment or benefit, it is intended that the provisions of this Agreement provide
for payments or benefits that either comply with, or are exempt from,
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and
the regulations and guidance promulgated thereunder (collectively, “Code
Section 409A”), and all provisions of this Agreement shall be construed in a
manner consistent with the requirements for avoiding taxes or penalties under
Code Section 409A.
(b) 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 upon or following a termination of employment unless such
termination is also a “separation from service” within the meaning of Code
Section 409A and, for purposes of any such provision of this Agreement,
references to a “termination,” “termination of employment” or like terms shall
mean “separation from service.” If Employee is deemed on the date of termination
of his employment to be a “specified employee” within the meaning of that term
under Code Section 409A(a)(2)(B) and using the identification methodology
selected by the Company from time to time, or if none, the default methodology,
then with regard to any payment or the providing of any benefit made subject to
this Section 17(b), to the extent required to be delayed in compliance with Code
Section 409A(a)(2)(B) and to the extent such payment and benefits exceed the
Separation Pay Limit (as defined herein) such payment or benefit shall not be
made or provided prior to the earlier of (i) the expiration of the six-month
period measured from the date of Employee’s “separation from service” and
(ii) the date of Employee’s death. On the first day of the seventh month
following the date of Employee’s “separation from service” or, if earlier, on
the date of his death, all payments delayed pursuant to this Section 17(b)
(whether they would have otherwise been payable in a single sum or in
installments in the absence of such delay) shall be paid or reimbursed to
Employee in a lump sum, and any remaining payments and benefits due under this
Agreement shall be paid or provided in accordance with the normal payment dates
specified for them herein. For purposes of this Agreement, the “Separation Pay
Limit” means two times the lesser of: (i) Employee’s annualized compensation
based on Employee’s annual rate of pay for Employee’s taxable year preceding the
taxable year in which Employee’s termination of employment occurs; and (ii) the
maximum amount that may be taken into account under a tax-qualified plan
pursuant to Code Section 401(a)(17) for the year in which Employee terminates
employment.

 

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(c) If under this Agreement, an amount is to be paid in two or more
installments, for purposes of Code Section 409A, each installment shall be
treated as a separate payment.
(d) To the extent any reimbursement of costs and expenses provided for under
this Agreement constitutes taxable income to Employee for Federal income tax
purposes, all such reimbursements shall be made no later than December 31 of the
calendar year next following the calendar year in which the expenses to be
reimbursed are incurred.
18. Survival. The provisions contained in Sections 7 through 18 shall survive
the termination or expiration of the Employment Period and the Employee’s
employment with the Company and shall be fully enforceable thereafter.
19. Legal Fees. The Company will reimburse Employee in an amount up to $20,000
for the reasonable attorneys’ fees (based on non-premium, standard rates for
time actually billed) incurred by him in connection with the current negotiation
and preparation of this Agreement.
20. Indemnification. The Company hereby agrees to indemnify Employee and hold
Employee harmless to the extent provided under the By-Laws of the Company.
21. Miscellaneous. This Agreement supersedes all prior understandings and
agreements between the parties (including the Company’s Related Entities) with
respect to the subject matter hereof. This Agreement contains the entire
agreement of the parties with respect to the subject matter covered hereby and
may be amended, waived or terminated o by an instrument in writing executed by
both parties hereto. Other than as specified herein, this Agreement shall be
binding upon and inure to the benefit of the parties hereto, their respective
heirs, executors, successors and permitted assigns. All notices, requests,
demands and other communications permitted or required hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered or
delivered by registered or certified mail, or overnight courier to such address
listed below the parties’ respective signature lines or to such other address as
notified in writing by the parties; provided, that, notices to the Company shall
be addressed to the attention of the “General Counsel”. Any provision hereof
prohibited by or unenforceable under any applicable law of any jurisdiction
shall as to such jurisdiction be deemed ineffective and deleted herefrom without
affecting any other provision of this Agreement. No provision of this Agreement
shall be interpreted against any party because such party drafted such
provision. Submission of this Agreement to Employee, or Employee’s agents or
attorneys, for examination or signature does not constitute or imply an offer of
employment, and this Agreement shall have no binding effect until execution
hereof by both the Company and Employee. If either party waives a breach of this
Agreement by the other party, that waiver will not operate or be construed as a
waiver of any subsequent breaches. This Agreement may be executed in
counterparts, including via facsimile or PDF, which together shall constitute
but one and the same agreement.

 

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IN WITNESS WHEREOF, this Agreement is EXECUTED as of the 20th day of
October 2008 to be EFFECTIVE FOR ALL PURPOSES as of the Effective Date.

            “COMPANY”

WESTWOOD ONE, INC.
      By:   /s/ David Hillman        Name:   David Hillman        Title:   CAO &
GC       Address:  40 West 57th Street, 5th Floor
New York, NY 10019        “EMPLOYEE”    
/s/ Gary Schonfeld      Gary Schonfeld      Address:   

 

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EXHIBIT A

FORM OF RELEASE
For good and valuable consideration received in connection with my termination
of employment with Westwood One, Inc., a Delaware corporation (the “Company”),
pursuant to Section 6 of my employment agreement with the Company dated
October 20, 2008 (the “Employment Agreement”), I, Gary Schonfeld, do hereby
release and forever discharge and covenant not to sue the Company, the Related
Entities (as defined in the Employment Agreement) and their respective
subsidiaries and affiliates and their respective directors, members, partners,
officers, managers, employees, agents, stockholders, successors and assigns
(both individually and in their official capacities) and its and their
predecessors or successors (collectively, the “Releasees”), from any and all
actions, causes of action, covenants, contracts, claims, demands, suits, and
liabilities whatsoever, which I ever had or now have or which I or any of my
heirs, executors, administrators and assigns hereafter can, shall or may have by
reason of or relating to my employment with the Company as of the effective date
of this general release (this “General Release”).
By signing this General Release, I am providing a complete waiver of all claims
against the Releasees that may have arisen, whether known or unknown, up until
the effective date of this General Release. This includes, but is not limited
to, claims based on Title VII of the Civil Rights Act of 1964, the Civil Rights
Act of 1866, the Age Discrimination in Employment Act of 1967 (including the
Older Workers Benefit Protection Act) (the “ADEA”), the Americans With
Disabilities Act, the Fair Labor Standards Act, the Equal Pay Act, the Family
and Medical Leave Act, the Employee Retirement Income Security Act of 1974
(“ERISA”) (except as to claims pertaining to vested benefits under employee
benefit plans covered by ERISA and maintained by the Releasees), and all
applicable amendments to the foregoing acts and laws, or any common law, public
policy, contract (whether oral or written, express or implied) or tort law, and
any other local, state or Federal law, regulation or ordinance having any
bearing whatsoever on the terms and conditions of my employment. This General
Release shall not, however, constitute a waiver of: (i) my rights under any
employee benefit plan currently maintained by the Company; (ii) my rights under
the Employment Agreement intended to survive my termination of employment;
(iii) my rights under the Company’s certificate of incorporation, By-Laws,
insurance policies or other written agreements with respect to indemnification;
or (iv) any claims to enforce rights arising under the ADEA or other civil
rights statute after the effective date of this General Release. I hereby
reaffirm my obligations under Sections 7 through 11 of the Employment Agreement,
and understand that such provisions shall be fully enforceable in accordance
with the terms and conditions of the Employment Agreement following my
termination of employment with the Company.
I further agree, promise and covenant that, to the maximum extent permitted by
law neither, I, nor any person, organization, or other entity acting on my
behalf has or will file, charge, claim, sue, or cause or permit to be filed,
charged or claimed, any action for damages or other relief (including
injunctive, declaratory, monetary or other relief) against the Releasees
involving any matter occurring in the past up to the date of this General
Release, or involving or based upon any claims, demands, causes of action,
obligations, damages or liabilities which are the subject of this General
Release. This General Release shall not affect my rights under the Older Workers
Benefit Protection Act to have a judicial determination of the validity of this
General Release and does not purport to limit any right I may have to file a
charge under the ADEA or other civil rights statute or to participate in an
investigation or proceeding conducted by the Equal Employment Opportunity
Commission or other investigative agency. This General Release does, however,
waive and release any right to recover damages under the ADEA or other civil
rights statute.

 

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I have been given twenty-one (21) days to review this General Release and have
been given the opportunity to consult with legal counsel, and I am signing this
General Release knowingly, voluntarily and with full understanding of its terms
and effects, and I voluntarily accept the consideration under Section 6 of the
Employment Agreement for the purpose of making full and final settlement of all
claims referred to above. If I have signed this General Release prior to the
expiration of the twenty-one (21) day period, I have done so voluntarily. I also
understand that I have seven (7) days after executing to revoke this General
Release, and that this General Release will not become effective if I exercise
my right to revoke my signature within seven (7) days of execution. I understand
and acknowledge that my right to receive the consideration under Section 6 of
the Employment Agreement, however, is conditioned upon my execution and
non-revocation of this General Release.
Upon the receipt of reasonable notice from the Company (including the Company’s
outside counsel), I agree to respond and provide information with regard to
matters in which I had knowledge as a result of my employment with the Company,
and provide reasonable assistance to the Company and its Related Entities and
their respective representatives in defense of any claims that may be made
against the Company or any of its Related Entities, and assist the Company and
its Related Entities in the prosecution of any claims that may be made by the
Company or any of its Related Entities, to the extent that such claims may
relate to the period of my employment with the Company. I further agree to
promptly inform the Company if I become aware of any lawsuits involving such
claims that may be filed or threatened against the Company or any of its Related
Entities. I also agree to promptly inform the Company (to the extent I am
legally permitted to do so) if I am asked to assist in any investigation of the
Company or any of its Related Entities or its or their actions, regardless of
whether a lawsuit or other proceeding has then been filed with respect to such
investigation, and shall not do so unless legally required.
I acknowledge that I have not relied on any representations or statements not
set forth in this General Release or the Employment Agreement.
This General Release will be governed by and construed in accordance with the
laws of the State of New York, without regard to the choice of law principles
thereof. If any provision in this General Release is held invalid or
unenforceable for any reason, the remaining provisions shall be construed as if
the invalid or unenforceable provision had not been included.
IN WITNESS WHEREOF, I have executed this General Release on this
                     day of                                         ,
20_____.

     
 
Gary Schonfeld
   

 

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