Employment Agreement - PRIMEDIA Inc. and William F. Reilly
AGREEMENT dated as of November 30, 1999 by and between PRIMEDIA,
INC., a Delaware corporation, having its principal place of business at 745
Fifth Avenue, New York, New York 10151 (the "Company") and WILLIAM F. REILLY, an
individual residing at 7 Sutton Square, New York, New York 10002 (the
"Executive").
BACKGROUND
The Executive, a founder of the Company and its Chairman and Chief
Executive Officer since 1989, has been employed by the Company (or its
predecessor, K-III COMMUNICATIONS CORPORATION) since its formation. The
Executive and the Company have determined that the parties shall make provision
for the Executive to step down as Chairman and Chief Executive Officer of the
Company, to be appointed Chairman Emeritus of the Company, to continue to render
services to the Company as an employee, and thereafter to retire from the
Company. The Company and the Executive have therefore entered into this
Agreement on the terms and conditions set forth herein.
1. Employment.
The Executive served as Chairman and Chief Executive Officer of the
Company until September 15, 1999, at which time, the Executive (a) ceased to be
Chairman and Chief Executive Officer of the Company; (b) ceased to be a member
of the Board of Directors (the "board") of the Company and its affiliated
companies; (c) was appointed "Chairman Emeritus" of the Company; and (d)
commenced to render advice and consultation to the Company for the "Employment
Period" as set forth in Section 3 hereof and shall continue to provide such
services until the Executive's "Retirement" as set forth in Section 6 hereof,
unless earlier terminated in accordance with Section 5 hereof.
2. Incentive Compensation for Prior Service as Chairman and Chief Executive
Officer.
(a) Bonus. The Company shall pay the Executive $1,079,250 not later than
ten (10) business days after the execution of this Agreement. Such payment
represents the sum of (i) the Executive's salary from September 15, 1999
through December 31, 1999 and (ii) short-term and long-term incentive
bonus which would have been paid to the Executive for the 1999 calendar
year (as if the Executive had continued in employment in the capacity of
Chairman and Chief Executive Officer of the Company through December 31,
1999).
(b) Vesting of Stock Options.
(i) Notwithstanding anything to the contrary contained in the Option
Agreements (as defined below), the Executive will be fully vested in
all of the stock options granted to him to purchase shares of
Company common stock, which are listed in Schedule A hereto and
which shall have the exercise prices and expiration dates as set
forth in such Schedule A. Such stock options and any Company Stock
(as defined in Section 7 hereof) acquired pursuant to such
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options shall be subject to the provisions of Section 7 hereof.
"Option Agreements" shall mean collectively the Non-Qualified Stock
Option Agreements dated May 13, 1992, May 3, 1994, September 30,
1994 and March 29, 1995, each between K-III Communications
Corporation and the Executive.
(ii) Notwithstanding anything to the contrary contained in the
Option Agreements, the Executive will be permitted to exercise all
of the stock options granted to him to purchase shares of Company
Stock through the delivery shares of Common Stock (which (i) the
Executive has held for at least six months prior to delivery of such
shares or (ii) the Executive has purchased on the open market and
for which the Executive holds title free and clear of all liens and
encumbrances) with an aggregate value on the date of exercise equal
to the exercise price and satisfy the income tax withholding
obligation upon exercise of any option, by the tender or deemed
tender of shares of Company common stock which would otherwise have
been acquired by the Executive upon the exercise of such stock
option. For purposes of this Section 2(b)(ii), all shares of Company
common stock shall be valued in a manner consistent with past
practice of the Company, which shall mean the highest trading price
of the Company's common stock on the New York Stock Exchange, or the
principal exchange on which the shares of Company Stock may at the
time be listed, on the date of exercise, or, if there shall have
been no sales on such exchange on such day, the highest of the bid
and asked prices on such exchange on such day or the next preceding
date when such bid and asked price occurred or, if the shares of
Company Stock shall not be so listed, the highest of the sales
prices as reported by NASDAQ on such day. If the shares of Company
Stock are not so listed or reported by NASDAQ, then the fair market
value of a share of Company Stock shall be determined by an
appraiser mutually agreeable to the Company and the Executive or the
Executive's beneficiary or estate, as the case may be, the costs and
expenses of which shall be borne by the Company.
(iii) Except as otherwise provided in Sections 2(b)(i) and 2(b)(ii)
hereof, in this subsection (b)(iii) or otherwise in this Agreement,
the stock options shall continue to be subject to the provisions of
the Option Agreements, it being understood and agreed, however, that
(A) the Executive's duties and services rendered hereunder shall be
deemed to satisfy the Executive's obligations under Section 2.3 of
each Option Agreement and the Company shall not prescribe any
additional duties and responsibilities for Executive or terminate
Executive's employment with the Company as may have been
contemplated by Section 2.3 of each Option Agreement, (B) for
purposes of Section 3.2(c) of each Option Agreement, the termination
of the employment of the Executive shall be deemed to occur on the
last day of the Employment Period and (C) the last sentence of
Section 5.6 of each Option Agreement and each reference to the
"Purchase Agreement" or "Common Stock Agreement" in Section 5.6 of
each Option Agreement shall be deemed to be omitted from each Option
Agreement.
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(c) Expenses. The Company shall reimburse the Executive for attorney fees
plus disbursements for the legal fees incurred in connection with this
Agreement and the subject matter hereof, including without limitation the
preparation, review and negotiation of this Agreement and all documents
related to this Agreement, such reimbursement not to exceed $20,000. Such
reimbursement shall be paid to the Executive within 10 days following
Executive's submission of a properly documented request for reimbursement.
3. Employment Period.
The Executive shall continue to be employed by the Company to render
advice and consultation to the Company on the basis described in this Agreement
until September 15, 2003 (the "Employment Period"). During the Employment
Period, the Executive shall report to the Board and shall perform such duties as
the Company's Chief Executive Officer or the Board shall require which may
include the following: (a) attend and represent the Company in international
trade association meetings and conferences, including without limitation, at the
"World Magazine Association"; (b) attend and represent the Company in domestic
trade association meetings and conferences, including without limitation, at the
"Magazine Publishers Association"; (c) attend advisory sessions and testify
before federal governmental bodies on behalf of the Company with respect to
pending or proposed federal legislation which may affect the Company and its
business; (d) advise the Company with respect to large acquisitions or
divestitures that it may contemplate; (e) assist the Company in major product
launches that it may contemplate; (f) assist the Company with respect to
relevant data base associations or organizations which may affect the Company
and its business; and (g) assist the Company with respect to the relationship of
print media publications to Internet sites and e-commerce; all of the foregoing
at the expense of the Company. Subject to the covenants set forth in Section 8
hereof, nothing contained herein shall preclude the Executive from devoting
substantial time and attention to his own personal investments or to pursuing
other business or investment opportunities during the Employment Period;
provided, that such activities do not materially interfere with Executive's
stated duties as an employee.
4. Compensation and Benefits during the Employment Period.
(a) Salary. During the Employment Period, the Company shall pay the
Executive an annual salary of $250,000 and an annual payment of $750,000
in consideration for compliance with Section 8 of this Agreement, payable
in regular installments in accordance with the Company's usual payment
practices.
(b) Expense Reimbursement. The Company shall promptly reimburse the
Executive for the ordinary and necessary business expenses previously
approved by the Company and reasonably incurred by Executive in the
performance of his duties during the Employment Period. Such reimbursement
shall be in accordance with the Company's policy.
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(c) Office and Secretarial Support. During the Employment Period, the
Company shall lease and provide to the Executive at the Company's expense
a fully equipped (i.e., fax, computer and similar equipment) and furnished
office space in midtown Manhattan, and shall provide the Executive with a
full-time executive secretary at the Company's expense, in each case, at a
level reasonably appropriate to the Executive's position with the Company.
Any Company expense for alterations or improvements to the office shall
not exceed $50,000.
(d) Medical and Dental Plans. During the Employment Period, the Executive
shall continue to participate in or receive benefits under any medical and
dental benefits plan generally made available by the Company to senior
executives. Except as otherwise provided in this Agreement, any such
participation shall be in accordance with the provisions of such plans and
nothing contained in this Agreement is intended to, or shall be deemed to,
affect adversely any of Executive's rights as a participant under any such
plans.
5. Termination of Employment on Account of Executive's Death or Permanent
Disability.
(a) Termination. Executive's employment under this Agreement shall
terminate upon Executive's death or permanent disability. For purposes of
this Agreement, "permanent disability" shall mean that the Executive has
been medically determined to have a physical or mental impairment which
can be expected to result in death or which has lasted or can reasonably
be expected to last for a continuous period of not less than six months.
(b) Compensation Due by Reason of Death or Permanent Disability. In the
event that Executive's employment is terminated by reason of Executive's
death or permanent disability, the Company shall pay the following amounts
to the Executive (or in the case of death, to the Executive's beneficiary
or estate):
(i) Earned But Unpaid Compensation. Any accrued but unpaid
compensation for services rendered to the date of death or permanent
disability, any accrued but unpaid expenses required to be
reimbursed under this Agreement and any vacation accrued to the date
of death or permanent disability.
(ii) Additional Payments. An amount equal to the compensation for
services which would have been payable to Executive if Executive had
continued in employment until the end of the Employment Period plus
the COBRA payments for a one year period following the death or
permanent disability of Executive to provide health insurance
coverage for the benefit of the Executive and/or Executive's family.
This amount will be paid in a single lump sum within thirty days
after the date of death or permanent disability, or, at the
Company's option can be paid, in installments over the balance of
the Employment Period, at the same time as payments had been made to
Executive.
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(iii) Other Benefits. Any benefits to which Executive may be entitled
pursuant to the plans, policies and arrangements of the Company,
determined and paid in accordance with the terms of such plans, policies
and arrangements.
(iv) Reduction for Disability Payments. The amount payable to Executive
under Section 5(b)(ii) hereof in the case of the Executive's permanent
disability during the Employment Period shall be reduced by the amount of
disability insurance benefits payable to Executive during such period
under any Company-paid disability insurance plan.
6. Retirement.
Commencing on September 16, 2003 (which shall be the day following the
termination of the Employment Period), the Executive shall commence his
retirement from the Company ("Retirement"). The Executive shall continue to be
named "Chairman Emeritus" of the Company following his Retirement.
(a) Supplemental Retirement Benefits. The Company shall pay to the
Executive a supplemental retirement benefit in recognition of service
through the Employment Period equal to $400,000 per annum commencing on
the Executive's Retirement for the remainder of the Executive's life. Such
amount shall be payable monthly in equal installments commencing with the
first day of the first month following the Executive's Retirement.
(b) Other Benefits. The Executive shall be paid all other benefits to
which the Executive may be entitled pursuant to the plans, policies and
arrangements of the Company, determined and paid in accordance with the
terms of such plans, policies and arrangements. The Company shall provide
to the Executive at its expense health insurance coverage for the benefit
of the Executive and his family for a period of 18 months following the
Executive's Retirement (or such longer period as may be required under
COBRA).
7. Company Stock.
(a) The Company shall cause all of the Company Stock held or to be
acquired by the Executive to be represented by certificates free of any
legend, including without limitation, the legend described in Section 2(b)
of each Purchase Agreement (as defined in Section 7(b) hereof).
(b) Except as expressly provided in this Agreement, any Company common
stock held by the Executive or acquired by the Executive pursuant to the
exercise of stock options from and after the date of this Agreement shall
be subject to the provisions of this Section 7 and shall not be subject to
the provisions of the Common Stock Purchase Agreements entered into as of
May 13, 1992 and May 3, 1994 or the Common Stock Agreements entered into
as of September 30, 1994 and March 29, 1995, each between K-
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III Communications Corporation and the Executive, as the same have been or
may be amended, or the Preferred Stock Purchase Agreement entered into as
of July 24, 1992 between K-III Communications Corporation and the
Executive, as the same has been or may be amended (such Preferred Stock
Purchase Agreement, together with the above-referenced Common Stock
Purchase Agreements and Common Stock Agreements, the "Purchase
Agreements"); provided, however, that (i) the provisions of Section 9
(other than the last sentence thereof) of each Purchase Agreement shall
continue to apply to any Company common stock so held or acquired as if
such provisions were in full force and effect and (ii) the provisions of
Section 10 (Registration Rights) of each Purchase Agreement shall continue
to apply to any Company common stock so held or acquired as if such
provisions were in full force and effect.
(c) The parties hereto hereby agree and acknowledge that the Sale
Participation Agreement dated July 24, 1992 between KKR Partners II, L.P.,
MA Associates, L.P., FP Associates, L.P., Magazine Associates, L.P., and
the Executive, which provides for certain "tag-along" rights in favor of
the Executive, is hereby deemed to be in full force and effect and,
notwithstanding the provisions of Section 7 thereof, shall continue to be
in full force and effect until the last date on which any of the stock
options set forth on Schedule A hereto may be exercised.
(d) For purposes of this Agreement, "Company Stock" shall include any and
all capital stock of the Company or any capital stock, partnership units
or any other security evidencing ownership interests in any successor of
the Company (whether by merger, consolidation, sale of assets or
otherwise) which may be issued in respect of, in exchange for, or in
substitution of the Company Stock, by reason of any stock dividend, split,
reverse split, combination, recapitalization, liquidation,
reclassification, merger, consolidation or otherwise, any of the
foregoing, a "capital transaction." In the event the Company undertakes to
effect a capital transaction or to declare a dividend or other
distribution with respect to the Company Stock, the Executive or the
Executive's beneficiary or estate, as the case may be, shall be afforded
the opportunity to exercise any of the Stock Options set forth on Exhibit
A hereto and become a stockholder with respect to the Company Stock to be
issued pursuant to such exercise, prior to the effectiveness of the
capital transaction or dividend or other distribution.
8. Restrictive Covenants.
(a) Protected Information. Executive recognizes and acknowledges that he
has had access to confidential or proprietary information concerning the
Company and entities affiliated with the Company (collectively, the
"Protected Information"). Executive therefore covenants and agrees that he
will not at any time, either while employed by the Company or afterwards,
knowingly make any independent use of or knowingly disclose to any other
person or organization (except as authorized by the Company) any of the
Protected Information. Information will not be "Protected Information"
under the provisions of this Agreement if (i) it was known by the
Executive prior to his
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employment with the Company, (ii) it is available from public sources or
otherwise known to the general public or disclosed by the Company to third
parties without a duty of confidentiality, or (iii) it is known to the
trade or in the Company's industry; provided, that (ii) and (iii) did not
result from Executive's breach of this Section 8(a).
(b) Nondisparagement. Executive covenants and agrees that he will not at
any time, either while employed by the Company or afterwards, publish any
statement or make any statement under circumstances reasonably likely to
become public that is critical of the Company or any of its affiliates,
including Kohlberg Kravis Roberts & Co. ("KKR"), or in any way adversely
affecting or otherwise maligning the business or reputation of the
Company, KKR or any of their respective affiliates. The Executive shall
maintain in all public communication, both written and verbal, the highest
regard for the Company and its affiliates and their personnel. The Company
covenants and agrees that it will not issue or publish any press release
or any statement to the press that is critical of the Executive, or in any
way adversely affecting or otherwise maligning the business or reputation
of the Executive. The Company shall maintain in all public communication,
both written and verbal, the highest regard for the Executive.
(c) Media Contact. From and after the date hereof, Executive will not
engage in any contact with the media with respect to the Company, KKR,
their respective affiliates, their employees, their shareholders, partners
or directors without the prior written consent of the Company.
(d) Competitive Activity. Executive covenants and agrees that at all times
during his period of employment with the Company, including during the
Employment Period, he will not, directly or indirectly, engage in, or have
any active interest or involvement whether as an employee, agent,
consultant, officer, or director (exclusive of Executive's current
directorship in Barnesandnoble.com), in any person, firm, or business
entity which is engaged in, the same "business" (as defined herein) as
that conducted and principally carried on by the Company without the
Company's specific written consent to do so, all of the foregoing in any
geographic area in which the Company does Business. For purposes of this
Section "Business" shall mean the business of publishing, selling and
distributing publications and magazines of the same type and nature as
those published by the Company at any time during the Employment Period;
provided, however, that any publication or magazine that the Company
ceases to publish, sell or distribute shall thereupon cease to constitute
part of the "Business" for purposes of this Section; provided, further
that if the Executive enters into any business, other than a Business,
after September 15, 1999 and during the Employment Period (a "Later
Started Business") and the Company thereafter enters into a Later Started
Business, the Later Started Business shall not constitute part of the
Business for purposes of this Section; provided, further that nothing
herein shall be deemed to preclude the Company and the Executive from
entering into an agreement for the purchase by the Executive of assets or
rights with respect to one or more of the magazines or publications
published by the Company. Notwithstanding the foregoing, the Company
acknowledges and agrees that the
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Executive shall be permitted to continue his investment and involvement in
Arc Publishing LLC ("Arc") and the Company shall continue its business
relationship with Arc on arms-length terms until the end of the Employment
Period; provided, such business relationship does not result in a
substantial cost to the Company.
(e) Non-solicitation. Executive covenants and agrees that at all times
during his period of employment with the Company, including during the
Employment Period, he will not, without the Company's prior written
consent, directly or indirectly, offer, solicit or encourage to leave the
employment or other service of the Company, or any of its affiliates, any
employee of the Company or its affiliates or any person who was so
employed within the three months prior to such offer or solicitation.
9. Enforcement of Covenants.
(a) Right to Injunction. Executive acknowledges that a breach of the
covenants set forth in Section 8 hereof will cause irreparable damage to
the Company with respect to which the Company's remedy at law for damages
will be inadequate. Therefore, in the event of breach or anticipatory
breach of the covenants set forth in this section by Executive, Executive
and the Company agree that the Company shall be entitled to cease making
any cash payments due hereunder pending ultimate resolution of the matter
and shall also be entitled to the following particular forms of relief, in
addition to remedies otherwise available to it at law or equity:
injunctions, both preliminary and permanent, enjoining or retraining such
breach or anticipatory breach and Executive hereby consents to the
issuance thereof forthwith and without bond by any court of competent
jurisdiction. Any payments held back pending resolution shall be paid to
the Executive within thirty (30) days of any resolution unless it has been
determined that Executive has breached the covenants set forth herein and
shall bear interest at the 90 day treasury rate for the period of
cessation.
(b) Separability of Covenants. The covenants contained in Section 8 hereof
constitute a series of separate covenants, one for each county and city
included within each State in the United States and the District of
Columbia, and one for each applicable foreign city or province included
within each foreign country. If in any judicial proceeding, a court shall
hold that any of the covenants set forth in Section 8 exceed the time,
geographic, or occupational limitations permitted by applicable laws,
Executive and the Company agree that such provisions shall and hereby
reformed to the maximum time, geographic, or occupational limitations
permitted by such laws. Further, in the event a court shall hold
unenforceable any of the separate covenants deemed included herein, then
such unenforceable covenant or covenants shall be deemed eliminated from
the provisions of this Agreement for the purpose of such proceeding to the
extent necessary to permit the remaining separate covenants to be enforced
in such proceedings.
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10. Withholding Taxes.
The Company shall withhold from any compensation and benefits payable
under this Agreement all applicable federal, state, local or other taxes and
such compensation and benefits (to the extent reportable as income) will be
reported as W-2 income of the Executive by the Company.
11. Source of Payments.
All payments provided under this Agreement, other than payments made
pursuant to a plan which provides otherwise, shall be paid from the general
funds of the Company, and no special or separate fund shall be established, and
no other segregation of assets made, to assure payment.
12. General Release.
As a condition to the receipt of any payments hereunder, Executive hereby
agrees to execute a release substantially in the form attached hereto as Exhibit
A. As a condition to the receipt of any payments hereunder after Executive's
Retirement, Executive, upon his Retirement, agrees to executive an additional
release substantially in the form attached hereto as Exhibit B.
13. Successor and Binding Agreement.
(a) Company Successor. The Company shall require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business or assets of the Company
expressly to assume and agree to perform this Agreement in the same manner
and to the same extent as the Company would be required to perform it if
no such succession had taken place. As used in this Agreement, "Company"
shall mean the Company as defined in the first sentence of this Agreement
and any successor to all or substantially all its business or assets or
which otherwise becomes bound by all the terms and provisions of this
Agreement, whether by the terms hereof, by operation of law or otherwise.
(b) Executive's Successor. This Agreement shall inure to the benefit of
and be enforceable by Executive and his personal or legal representatives
and successors in interest under this Agreement; provided, however, that
Executive may not assign any of the duties and obligations hereunder
without the written consent of the Board.
(c) Facility of Payment. In the event of Executive's legal incapacity, the
Company may make any payments due under this Agreement to his legal
representative. In the event of Executive's death, the Company may make
any payment due under this Agreement to his surviving spouse or, if none,
to Executive's estate.
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14. Assignment.
The rights and benefits of Executive under this Agreement are personal to
him and no such right or benefit shall be subject to voluntary or involuntary
alienation, assignment or transfer; provided, however, that nothing in this
Section 14 shall preclude Executive from designating a beneficiary or
beneficiaries to receive any benefit payable on his death or from transferring
any of his rights and benefits hereunder to (a) his executors, administrators,
testamentary trustees, legatees or beneficiaries, (b) the executors,
administrators, testamentary trustees, legatees or beneficiaries of any of the
persons in clause (a) above or (c) a trust or custodianship, the beneficiaries
of which include only the Executive, his spouse or his lineal descendants by
blood or adoption.
15. Governing Law.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York applicable to agreements made and to be performed
in that State, without regard to its conflict of laws provisions.
16. Notices.
Any notice, consent, request or other communication made or given in
connection with this Agreement shall be in writing and shall be deemed to have
been duly given when delivered or mailed by registered or certified mail, return
receipt requested, or by facsimile or by hand delivery, to those listed below at
their following respective addresses or at such other address as each may
specify by notice to the others:
To the Company:
Primedia, Inc.
745 Fifth Avenue
New York, New York 10151
Attention General Counsel
Fax: (212) 745-0101
With a copy to:
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Gary I. Horowitz, Esq.
Fax: (212) 455-2502
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To Executive:
William F. Reilly
7 Sutton Square
New York, New York 10002
With a copy to:
Dechert Price & Rhoads
30 Rockefeller Plaza
New York, New York 10112
Attention: James E. Tolan, Esq.
Fax (212) 698-3599
17. Miscellaneous.
(a) Waiver. The failure of a party to insist upon strict adherence to any
term of this Agreement on any occasion shall not be considered a waiver
thereof or deprive that party of the right thereafter to insist upon
strict adherence to that term or any other terms of this Agreement.
(b) Separability. If any term or provision of this Agreement is declared
illegal or unenforceable by any court of competent jurisdiction and cannot
be modified to be enforceable, such term or provision shall immediately
become null and void, leaving the remainder of this Agreement in full
force and effect.
(c) Headings. Section headings are used herein for convenience of
reference only and shall not affect the meaning of any provision of this
Agreement.
(d) Rules of Construction. Whenever the context so requires, the use of
the singular shall be deemed to include the plural and vice versa.
(e) Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original,
and such counterparts will together constitute but one Agreement.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year set forth below.
PRIMEDIA, INC.
By: /s/ Beverly C. Chell
-----------------------------------
Date: 12/2/99
---------------------------------
EXECUTIVE
By: /S/ William F. Reilly
-----------------------------
Date: 11/30/1999
---------------------------
Acknowledged and Agreed to for
the purposes of Section 7(c) as
of the date first written above:
--------------------------------
--------------------------------
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Reilly Agreement
dated as of November 30, 1999
Schedule A
Company Stock Options
Expiration
Grant Date Date Share Price # of Options
5/13/92 5/13/02 $ 5.00 2,425,160
5/03/94 5/03/04 $ 8.00 188,000
9/30/94 9/30/04 $ 8.00 125,000
3/29/95 3/29/05 $ 8.00 150,000
10/07/96 10/07/06 $11.13 150,000
Total Options 3,038,160
<PAGE>
EXHIBIT A
GENERAL RELEASE
WHEREAS, Mr. William F. Reilly ("Executive") has ceased to be
Chairman and Chief Executive Officer of PRIMEDIA, INC. ("PRIMEDIA"); and
WHEREAS, Executive and PRIMEDIA have reached a full and final
compromise and settlement of all matters, disputes, causes of action, claims,
contentions and differences between them and PRIMEDIA's divisions, merged
entities and affiliates, subsidiaries, parents, branches, predecessors,
successors, assigns, officers, directors, trustees, employees, agents,
stockholders (including without limitation all affiliates of Kohlberg Kravis and
Roberts & Co. ("KKR")), administrators, representatives, attorneys, insurers or
fiduciaries, past, present or future (the "Released Parties"), including but not
limited to any and all claims arising from or derivative of Executive's
employment with PRIMEDIA as Chairman and Chief Executive Officer through
September 15, 1999;
WHEREAS, in return for PRIMEDIA performing its obligations as
provided for herein, the agreement between the Executive and PRIMEDIA dated as
of November 30, 1999 (the "Agreement"), Executive will execute and comply fully
with the terms of this General Release (the "Release");
WHEREAS, Executive (i) understands that in executing the Release he
is, inter alia, giving up rights and claims under the Age Discrimination in
Employment Act of 1967, as amended, 29 U.S.C. Section 621 et seq. ("ADEA"), and
(ii) has been given a period of not less than 21 days within which to consider
this Release;
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, Executive and PRIMEDIA agree and covenant as
follows:
1. By entering into this Release, the Released Parties do not admit,
and each specifically denies any liability, wrongdoing or violation of any law,
statute, regulations, agreement or policy.
2. Executive ceased to be Chairman and Chief Executive Officer of
PRIMEDIA effective September 15, 1999.
3. In consideration of the obligations of Executive as set forth in
this Release and the Agreement, and in full settlement and final satisfaction of
any and all claims, contractual or otherwise, which Executive had, has or may
have against PRIMEDIA or the Released Parties with respect to his employment as
Chairman and Chief Executive Officer, or otherwise arising on or prior to
September 15, 1999, PRIMEDIA shall pay to Executive the payments and benefits to
which Executive is entitled under the Agreement. This Release shall not pertain
to any claim alleging that PRIMEDIA has failed to comply with any obligations
created by the Agreement or the Release or that PRIMEDIA has failed to pay to
Executive the payments and benefits to which Executive is entitled under the
Agreement.
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4. (a)Executive, for and in consideration of the payments and
benefits as set forth in the Agreement and for other good and valuable
consideration, hereby, on behalf of himself, his agents, assignees, attorneys,
successors, assigns, heirs and executors, releases and forever discharges, and
by this release does release and forever discharge, PRIMEDIA and the Released
Parties of and from all debts, obligations, promises, covenants, collective
bargaining obligations, agreements, contracts, endorsements, bonds,
controversies, suits or causes of actions known or unknown, suspected or
unsuspected, of every kind and nature whatsoever, which may heretofore have
existed or which may now exist, including but not limited to those arising under
the ADEA, Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C.
Section 2000e et seq., the Employee Retirement Income Security Act of 1974, as
amended, 29 U.S.C. Section 1001 et seq., the Americans With Disabilities Act, as
amended, 42 U.S.C. Section 12101 et seq., the Reconstruction Era Civil Rights
Act, as amended, 42 U.S.C. Section 1981 et seq., the Rehabilitation Act of 1973,
as amended, 29 U.S.C. Section 701 et seq., the Family and Medical Leave Act of
1992, 29 U.S.C. Section 2601 et seq., and any and all state or local laws
regarding employment discrimination and/or federal, state or local laws of any
type or description regarding employment as well as any claim for breach of
contract, wrongful discharge, breach of any express or implied promise,
misrepresentation, fraud, retaliation, violation of public policy, infliction of
emotional distress, defamation, promissory estoppel, invasion of privacy or any
other theory or claim, whether legal or equitable, including but not limited to
any claims arising from or derivative of Executive's employment with PRIMEDIA as
Chairman and Chief Executive Officer through September 15, 1999. Executive
acknowledges that he has not been discriminated against on the basis of age,
sex, handicap, race, ethnicity, religion or any other protected class status.
(b) This Release shall not affect (i) any present or future
indemnification obligations that PRIMEDIA and the Released Parties may have to
Executive pursuant to any charter, by-law, agreement or policy of insurance,
(ii) any benefits or payments to which Executive is entitled under any of the
PRIMEDIA employee benefit plans or (iii) any right Executive has as an optionee
or shareholder of PRIMEDIA.
5. Executive covenants and agrees not to sue nor authorize any other
party, either governmental or otherwise, to file any grievances, arbitration or
commence any other proceeding, administrative or judicial, against PRIMEDIA or
the Released Parties in any court of law or equity, or before any administrative
agency, with respect to any claims released pursuant to this Release.
6. PRIMEDIA, the Released Parties and Executive understand and agree
that the terms of this Release and the Agreement are confidential except (i) to
the extent required by law, (ii) to the extent this Agreement has been made
public and (iii) that the Executive may disclose the terms of this Agreement to
his spouse, financial advisor, accountants and attorney, provided that such
persons understand and agree that the terms of this Release and Agreement are
confidential.
7. Except as herein contemplated, Executive agrees that he will not
voluntarily participate in any proceeding of any kind brought against PRIMEDIA
or the Released Parties relating to any claims released pursuant to this
Release.
<PAGE>
3
8. (a) The parties agree that this Release should be construed in
accordance with the laws of the State of New York, exclusive of New York choice
of law provisions.
(b) The parties agree that any and all further legal
proceedings between Executive and PRIMEDIA or the Released Parties relating to
any claims released pursuant to this Release, whether arising under statute,
constitutions, contract, common law or otherwise, including the issue of
arbitrability, will be submitted for resolution exclusively pursuant to
arbitration under the rules of the American Arbitration Association and that
such arbitration will take place in New York, New York. The parties hereby waive
their right to a trial of any and all claims arising out of this Release or
breach of this Release.
(c) Should any provision of this Release be found to be in
violation of any law, or ineffective or barred for any reason whatsoever, the
remainder of this Release shall be in full force and effect to the maximum
extent permitted by law.
9. PRIMEDIA and Executive agree to execute such other documents and
to take such other actions as may be reasonably necessary to further the
purposes of this Release.
(a) Executive acknowledges and agrees that, in deciding to
execute this Release, he has had the opportunity to consult with legal,
financial and other personal advisors of his own choosing as he deems
appropriate, in assessing whether to execute this Release and that he has
consulted legal counsel. Executive represents and acknowledges that no
representations, statement, promise, inducement, threat or suggestion has been
made by PRIMEDIA or the Released Parties to influence him to sign this Release
except such statements as are expressly set forth herein. Executive agrees that
he has been given a minimum of twenty-one (21) days within which to consider the
terms and effects of this Release insofar as it relates to settlement and
release of potential claims under the ADEA, and to consult with, and to ask any
questions that he may have of anyone, including legal counsel and other personal
advisors of his own choosing, and that he has executed this Release voluntarily
and with fill understanding of its terms and effects.
(b) Executive has been informed of his right to revoke this
Release as far as it extends to potential claims under the Age Discrimination in
Employment Act, 29 U.S.C. Section 621 et seq., by informing PRIMEDIA of his
intent to revoke this Release within seven calendar days following the execution
of this Release. To be effective, notice of revocation must be in writing and
must be delivered either by hand or by mail to Beverly Chell, General Counsel,
PRIMEDIA, Inc., 745 Fifth Avenue, 23rd Floor, New York, NY, 10151, within the
7-day period. If a notice of rescission or revocation is delivered by mail, it
must be: (i) postmarked within the seven day period, respectively, (ii) properly
addressed to Ms. Chell as set forth above, and (iii) sent by certified mail
return receipt requested. This Release shall not become effective or enforceable
until the seven day period described above has expired. No payment shall be due,
owing or paid by PRIMEDIA unless and until this Release becomes effective.
<PAGE>
4
10. This Release may not be changed or modified, except by a written
instrument signed by Executive and PRIMEDIA.
/s/ William F. Reilly
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William F. Reilly
Address 7 SUTTON SQUARE
NEW YORK, NY 10022
Date NOVEMBER 30, 1999
STATE OF NEW YORK )
) ss
COUNTY OF )
On November 30, 1999, before me personally came William F. Reilly to
me known and known to me to be the individual described in, and who executed,
the foregoing General Release, and duly acknowledged to me that he executed the
same
/s/ Katina Nash
--------------------------------------
Notary Public
Katina Nash
NOTARY PUBLIC, State of New York
No. 94-4817148
Certified in Kings County
Cert. Filed in New York County
Commission Expires 6-30-01
PRIMEDIA, INC.
By:
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Address
Date