Document:

Exhibit 10.2

 

SINCLAIR BROADCAST GROUP, INC.

 

STOCK APPRECIATION RIGHT AGREEMENT

 

THIS STOCK APPRECIATION RIGHT AGREEMENT (this “Agreement”) is made and entered into as of this 22nd day of March, 2011 (the “Grant Date”) between Sinclair Broadcast Group, Inc., a Maryland corporation (the “Company”), and David D. Smith (“Smith”).

 

RECITALS

 

WHEREAS, the Company had adopted the 1996 Long-Term Incentive Plan of Sinclair Broadcast Group, Inc. (the “Plan”) to reward certain key individuals for making contributions to the Company and its subsidiaries by enabling them to acquire shares of Class A Common Stock, par value $.01 per share (“Common Stock”), of the Company; and

 

WHEREAS, the Company desires to grant to Smith stock-settled compensation based on the appreciation in value of three hundred thousand (300,000) shares of Common Stock (the “SARs”) pursuant to the Plan and upon the terms and subject to the conditions hereinafter set forth.

 

AGREEMENTS

 

NOW, THEREFORE, IN CONSIDERATION OF the foregoing premises, the parties to this Agreement agree as follows:

 

1.             Grant of SARs.  Subject to the terms and conditions set forth in this Agreement, the Company hereby grants to Smith the fully vested right to receive Common Stock of the Company equal in value to the difference between the SARs’ base value of Twelve Dollars and Seven Cents ($12.07) per SAR, which is the fair market value of one share of Common Stock on the date of grant under the Plan, and the per share closing price of the Company’s Common Stock on the date of exercise.

 

2.             Relationship to Plan.  The SARs are issued in accordance with and subject to all of the terms, conditions, and provisions of the Plan, as amended from time to time and administrative interpretations thereunder, if any, which have been adopted by the Committee thereunder and are in effect on the date hereof.  Except as defined herein or otherwise stated, capitalized terms shall have the same meanings ascribed to them under the Plan.

 

3.             Termination of SARs.  The SARs hereby granted shall terminate and be of no force and effect with respect to any shares of Common Stock not previously acquired by Smith on the tenth (10th) anniversary of the Grant Date.

 

 

4.             Exercise of SARs.  Subject to the limitations herein and in the Plan, the SARs may be exercised with respect to the shares of Common Stock, in whole or in part, at any time on or prior to the tenth (10th) anniversary of the Grant Date, regardless of Smith’s service status, by written notice to the Company at its principal executive office.  Notwithstanding any contrary provision of this Agreement or the Plan, the exercise price of a SAR shall not be less than the fair market value of the Common Stock on the date of grant under the Plan.

 

5.             Transferability.  The SARs shall not be transferable except by will or by the laws of descent and distribution.  During Smith’s lifetime, the SARs may be exercised only by Smith.  No assignment or transfer of the SARs, whether voluntary or involuntary, by operation of law or otherwise, except a transfer by will or by the laws of descent or distribution, shall vest in the assignee or transferee any interest or right whatsoever in the SARs.

 

6.             No Rights as Stockholder.  Smith shall not have any rights as a stockholder of the Company with respect to any of the shares subject to the SARs, except to the extent that such shares shall have been acquired by and transferred to Smith.

 

7.             Dissolution or Merger.  Upon the dissolution or liquidation of the Company, a merger or consolidation in which the Company is not the surviving corporation, or a transaction in which another individual or entity becomes the owner of fifty percent (50%) or more of the total combined voting power of all classes of stock of the Company, the unexercised portion of the SARs shall terminate, but Smith shall have the right to exercise the unexercised portion of the SARs immediately prior to such event.

 

8.             Withholding for Tax Purposes.  Any amount of Common Stock that is payable or transferable to Smith hereunder may be reduced by any amount or amounts which the Company is required to withhold under the then applicable provisions of the Internal Revenue Code of 1986, as amended, or its successors, or any other federal, state, or local tax withholding requirement.  If Smith does not elect to satisfy withholding requirements in this fashion, the issuance of the shares of Common Stock transferable to Smith hereunder shall be contingent upon Smith’s satisfaction of any withholding obligations that may apply and Smith’s presentation of evidence satisfactory to the Board that such withholding obligations have been satisfied.

 

9.             Notice.  Whenever any notice is required or permitted hereunder, such notice must be in writing and personally delivered or sent by mail.  Any notice required or permitted to be delivered hereunder will be deemed to be delivered on the date that it is personally delivered or, whether actually received or not, on the third (3rd) business day after it is deposited in the United States mail, certified or registered, postage prepaid, addressed to the person who is to receive it at the address that such person has heretofore specified by written notice delivered in accordance herewith.  The Company or Smith may change, at any time and from time to time, by written notice to the other, the address that it or he had therefore specified for receiving notices.

 

2

 

Until changed in accordance herewith, the Company and Smith specify their respective addresses as set forth below:

 

	
Company:
    	
 
    	
Sinclair   Broadcast Group, Inc.
    
	
 
    	
 
    	
10706   Beaver Dam Road
    
	
 
    	
 
    	
Cockeysville,   Maryland 21030
    
	
 
    	
 
    	
Attn:
    	
David   B. Amy,
    
	
 
    	
 
    	
 
    	
Executive   Vice President
    
	
 
    	
 
    	
 
    	
 
    
	
with   copy to:
    	
 
    	
Sinclair   Broadcast Group, Inc.
    
	
 
    	
 
    	
10706   Beaver Dam Road
    
	
 
    	
 
    	
Cockeysville,   Maryland 21030
    
	
 
    	
 
    	
Attn:  Executive Vice President/General Counsel
    
	
 
    	
 
    	
 
    
	
Smith:
    	
 
    	
David   D. Smith
    
	
 
    	
 
    	
c/o   Sinclair Broadcast Group, Inc.
    
	
 
    	
 
    	
10706   Beaver Dam Road
    
	
 
    	
 
    	
Cockeysville,   Maryland 21030
    

 

10.           Amendment.  Notwithstanding any other provision hereof, this Agreement may not be supplemented or amended from time to time without the written consent of Smith and the Company.

 

11.           Governing Law.  This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Maryland applicable to agreements made and to be performed entirely in Maryland.

 

12.           Counterparts.  This Agreement may be executed in multiple counterparts.  The Company and Smith may sign any number of copies of this Agreement.  Each signed copy shall be an original, but all of them together represent the same agreement.

 

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— SIGNATURES ON FOLLOWING PAGE]

 

3

 

IN WITNESS WHEREOF, the Company and Smith have caused this Agreement to be executed as of the date first above written.

 

 

	
WITNESS:
    	
 
    	
 
    	
SINCLAIR   BROADCAST GROUP, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
/s/   Vicky Evans
    	
 
    	
By:
    	
/s/   David B.   Amy                         
    	
(SEAL)
    
	
 
    	
 
    	
Name:
    	
David   B. Amy
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
/s/   Vicky Evans
    	
 
    	
 
    	
/s/   David D. Smith                      
    	
(SEAL)
    
	
 
    	
 
    	
 
    	
David   D. Smith
    

 

4Exhibit 10.1

 

[Global Letterhead]

 

 

Effective as of January 1, 2011

 

 

Mark Cosenza, Chief Financial Officer

Alliance Energy LLC

404 Wyman Street, Suite 425

Waltham, MA  02451

 

Re:      2011 Shared Services Fee Structure with Global Companies LLC

 

Dear Mark:

 

The herein letter agreement shall reflect the agreement between Alliance Energy LLC (“Alliance”) and Global Companies LLC (“Global”) with respect to shared services for the calendar year 2011.

 

Reference is made to that certain Amended and Restated Services Agreement by and between Alliance and Global dated as of the 4th day of October, 2005, a copy of which is attached hereto and incorporated herein by reference as Exhibit A (the “Shared Services Agreement”).  To the extent that there is a conflict between the terms of the herein letter agreement and said Shared Services Agreement, the terms and provisions of this letter agreement shall govern.

 

In consideration of the following services to be provided by Global to Alliance during the 2011 calendar, Alliance agrees to pay Global those corresponding amounts hereinafter set forth:

 

1.                                  Information Technology Infrastructure:  $112,000.00 billed in equal monthly installments of $9,333.33.

 

2.                                  Production support, routine IT maintenance and approved projects support shall be provided by Global through two (2) full-time dedicated employees.  All salaries and benefits for said two individuals shall be reimbursed to Global by Alliance.  From time to time thereafter, Alliance and Global agree to review the need to maintain said two (2) full-time dedicated employees for the exclusive benefit of Alliance and adjust the fees and services accordingly.

 

3.                                  Attached as Exhibit B is 2011 proposed work to be performed for the benefit of Alliance, subject to change as may be mutually agreed by the parties.  A change in projects and/or the expansion of Alliance’s operations shall warrant a reassessment of costs and benefits being provided.  All “new” projects for which IT support from Global is sought to be provided shall require the approval of Alliance and Global.

 

 

4.                                  To the extent that Alliance and Global reasonably determine that two full-time dedicated employees are inadequate to provide the resources and services that were otherwise necessary considering Alliance’s needs as of January 1, 2011, additional support services shall be provided at the rate of $100.00 per hour.

 

5.                                  To the extent that Global cannot provide additional in-house resources at the rate of $100.00 per hour to effectively provide a request by Alliance for an expansion of the IT services, Global may seek such additional support services from a third-party vendor, which costs, in all instances, shall be borne by Alliance (upon presentation of documentation evidencing such costs and subject to Alliance’s approval, not to be unreasonably withheld).

 

6.                                  In addition to those IT services described in the immediately preceding paragraphs, Global shall provide limited legal support services in consideration of $60,000 per annum, payable in equal monthly installments.

 

7.                                  In addition to those IT and legal services described above, Global may provide from time to time limited accounting, finance, tax and human resources support in consideration of $15,000.00 per annum, payable in equal monthly installments.

 

8.                                  From time to time, Global may request that Alliance provide Global support services, which support services, to the extent personnel is available, shall be provided at the rate of $100.00 per hour.

 

9.                                  Except as modified by the terms of the herein letter agreement, the Shared Services Agreement shall remain in full force and effect.

 

10.                          Absent the occurrence of material changes in the actual services being provided, or personnel providing same, the shared services fees for 2011 shall remain in full force and effect for the 2011 calendar year.

 

Witness our hands and seals this 9th day of March, 2011.

 

	
ALLIANCE ENERGY LLC
    	
 
    	
 
    	
GLOBAL   COMPANIES LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Mark Cosenza
    	
 
    	
By:
    	
/s/   Charles Rudinsky
    
	
 
    	
Mark   Cosenza
    	
 
    	
 
    	
Charles   Rudinsky
    
	
 
    	
Its   Chief Financial Officer
    	
 
    	
 
    	
Its Chief   Accounting Officer

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