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Title: |
Incentive Bonus Agreement |
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Entities: |
Kanawha River Ventures I LLC; Metromedia International Group Inc.; Paul, Weiss, Rifkind, Wharton & Garrison |
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Date: |
2006 |
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Size: |
Preview shows 5KB of 24KB total |
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Price: |
$39 |
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ID: |
#2540796 |
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METROMEDIA INTERNATIONAL GROUP, INC.
INCENTIVE BONUS AGREEMENT
-------------------------
THIS AGREEMENT is entered into as of the 1st day of October, 2006 (the
"Effective Date") by and between Metromedia International Group, Inc., a
Delaware corporation (the "Company"), and Mark Stephen Hauf ("Executive").
WHEREAS, the Company has entered into a letter of intent pursuant to which
it anticipates selling all or substantially all of its assets (the "LOI Sale
Transaction"); and
WHEREAS, Executive is currently employed by the Company as its Chief
Executive Officer, and the Board of Directors of the Company (the "Board") has
determined that it is in the best interests of the Company and its stockholders
to compensate Executive for creating the value in the Company's securities that
the Company expects to realize in connection with the LOI Sale Transaction or
any other "Sale Transaction" (defined below) and to provide an incentive for
Executive to perform his duties to the Company in furtherance of the Company's
efforts to consummate such transaction; and
WHEREAS, to such end, the Company desires to provide Executive with certain
payments and benefits pursuant to the terms of this Agreement; and
WHEREAS, the Board of Directors has authorized the Company to enter into
this Agreement.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants and agreements contained herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Company and Executive hereby agree as follows:
I. Incentive Bonus. The Company agrees that, if a definitive agreement to
consummate the LOI Sale Transaction or any other sale of the Company or
transaction pursuant to which the Company sells all or substantially all of its
assets (collectively with the LOI Transaction, a "Sale Transaction") is entered
into by January 31, 2007, the Sale Transaction is subsequently consummated and
the holders of shares of preferred stock, par value $1.00 per share, of the
Company ("Preferred Stock") have received an amount equal to $68.00 per share of
Preferred Stock, Executive shall be entitled to receive a bonus equal to 3.2% of
the gross proceeds received by the Company or its shareholders in the Sale
Transaction (the "Incentive Bonus"), which shall be payable in a single lump sum
cash payment as soon as reasonably practicable following the date of the last
payment to the holders of Preferred Stock that results in such holders receiving
at least $68.00 per share (the "Payment Date"), subject to Executive's continued
{PAGE}
employment on such date. Notwithstanding the foregoing, if Executive's
employment is terminated by the Company without "Cause" or by Executive for
"Good Reason" (as such terms are defined in the employment agreement, entered
into on October 6, 2003 and effective as of October 1, 2003, by and between
Executive and the Company, as amended from time to time (the "Employment
Agreement")) at any time before the Payment Date, Executive shall be entitled to
receive the Incentive Bonus on the Payment Date, if it occurs. Executive hereby
acknowledges that the Company's filing of any chapter 11 case in any United
States Bankruptcy Court shall not constitute Good Reason within the meaning of
his Employment Agreement.
II. Certain Additional Payments by the Company
A. If it is determined (as hereafter provided) that any payment or
distribution by the Company to or for the benefit of Executive, whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise pursuant to or by reason of any other agreement, policy, plan,
program or arrangement (a "Payment"), would be subject to the excise tax imposed
by Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code")
(or any successor provision thereto) or to any similar tax imposed by state or
local law, or any interest or penalties with respect to such excise tax (such
tax or taxes, together with any such interest and penalties, are hereafter
collectively referred to as the "Excise Tax"), then Executive will be entitled
to receive an additional payment or payments (a "Gross-Up Payment") in an amount
such that, after payment by Executive of all taxes (including any interest or
penalties imposed with respect to such taxes), including any Excise Tax, imposed
upon the Gross-Up Payment, Executive retains an amount of the Gross-Up Payment
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