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EXHIBIT 10.56
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EXECUTION COPY
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EMPLOYMENT AGREEMENT
BETWEEN
CHANCELLOR MEDIA CORPORATION
AND
XXXXXX X. XXXXXXXX
This Employment Agreement (this "Agreement") is made and
entered into as of October 1, 1998 (the "Effective Date"), between Chancellor
Media Corporation, a Delaware corporation (the "Company"), Chancellor Media
Corporation of Los Angeles, a Delaware corporation ("Los Angeles"), and Xxxxxx
X. XxXxxxxx (the "Executive"), residing at 0000 Xxxxxxx Xxxxx, Xxxxxx, Xxxxx
00000.
W I T N E S S E T H:
WHEREAS, the Company has a need for executive management
services; and
WHEREAS, the Executive is qualified and willing to render such
services to the Company; and
WHEREAS, the parties hereto desire to enter into an employment
agreement for the services of the Executive, on the terms and conditions as set
forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and obligations hereinafter set forth, the parties agree as
follows:
1. DEFINITIONS
The following terms used in this Agreement shall have the
meaning specified below unless the context clearly indicates the contrary:
"Annual Bonus" shall mean the annual incentive bonus payable
to the Executive described in Section 4.
"Average Bonus" shall mean the greater of (a) (i) the total of
the Annual Bonuses paid hereunder with respect to the Employment Term, divided
by (ii) the length of such portion of the Employment Term in years (including
fractions) as falls on or prior to the last December 31 thereof and (b) the Base
Salary then in effect.
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"Base Salary" shall mean the annual base salary payable to the
Executive at the rate set forth in Section 4.
"Board" shall mean the Board of Directors of the Company.
"Capstar" shall mean Capstar Broadcasting Corporation, a
Delaware corporation.
"Capstar Merger" shall mean the proposed merger of the Company
with and into a subsidiary of Capstar, subsequent to which Capstar will change
its name to Chancellor Media Corporation.
"Cause" shall mean the Executive's (a) habitual neglect of his
material duties or failure to perform his material obligations under this
Agreement, (b) refusal or failure to follow lawful directives of the Chief
Executive Officer, (c) commission of an act of fraud, theft or embezzlement, or
(d) conviction of a felony or other crime involving moral turpitude; provided,
however, that the Company shall give the Executive written notice of any actions
alleged to constitute Cause under subsections (a) and (b) above, and the
Executive shall have a reasonable opportunity (as specified by the Compensation
Committee) to cure any such alleged Cause.
"Change in Control" shall mean (a) the sale, lease or other
transfer of all or substantially all of the assets of the Company to any person
or group (as such term is used in Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended); (b) the adoption by the stockholders of the Company of
a plan relating to the liquidation or dissolution of the Company; (c) the merger
or consolidation of the Company with or into another entity or the merger of
another entity into the Company or any subsidiary thereof with the effect that
immediately after such transaction the stockholders of the Company immediately
prior to such transaction (or their Related Parties) directly and indirectly
hold less than fifty percent (50%) of the total voting power of all securities
generally entitled to vote in the election of directors, managers or trustees of
the entity surviving such merger or consolidation; (d) the acquisition by any
person or group of more than fifty percent (50%) of the direct and indirect
voting power of all securities of the Company generally entitled to vote in the
election of directors of the Company; or (e) the majority of the Board is
composed of members who (i) have served less than twelve (12) months and (ii)
were not approved by a majority of the Board at the time of their election or
appointment.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Common Stock" shall mean $0.01 par value common stock of the
Company.
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"Compensation Committee" shall mean the Compensation Committee
of the Board.
"Consumer Price Index" shall mean the Consumer Price Index for
All Urban Consumers (1982-84=100) for all cities as reported by the United
States Bureau of Labor Statistics.
"Contract Year" shall mean each twelve (12) consecutive month
period during the Employment Term which begins on the Effective Date and each
annual anniversary thereof.
"Contract Non-Renewal" shall mean the decision to not renew or
extend the Employment Term beyond the Expiration Date other than for Cause (as
to the Company's decision) or Good Reason (as to the Executive's decision).
"Employment Inducements" shall mean any compensation,
including, without limitation, signing bonuses and stock options, that are paid
or granted to senior officers of the Company in connection with such officers'
initial hiring by the Company, or in connection with any amendments to or
extensions of the term of such senior officers' employment agreements with the
Company.
"Employment Term" shall mean the period beginning on the
Effective Date and ending on the close of business on the effective date of the
Executive's termination of employment with the Company.
"Excise Tax" shall mean the taxes imposed by Code Section
4999.
"Execution Options" shall have the meaning ascribed to such
term in Section 4(i)(b).
"Expiration Date" shall have the meaning ascribed to such term
in Section 2.
"Good Reason" shall mean (a) the Company's material breach of
any provision hereof, (b) the Executive no longer directly reporting to Xxxxxxx
X. Xxxxxx, (c) any adverse change in the Executive's job responsibilities,
duties, functions, status, offices, title, perquisites or support staff, (d)
relocation of the Executive's regular work address outside of the Dallas
metropolitan area without his consent, or (e) a Change in Control; provided,
however, that the Executive shall give the Company written notice of any actions
(other than that set out in subsection (e) above) alleged to constitute Good
Reason and the Company shall have a reasonable opportunity to cure any such
alleged Good Reason during the 30-day period commencing on the date the Company
receives such written notice.
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"New Chancellor" shall mean, from and after the consummation
of the Capstar Merger, Chancellor Media Corporation, a Delaware corporation, as
successor by name change to Capstar.
"Option Agreement" shall mean the agreement between the
Executive and the Company pursuant to which any Options are granted to the
Executive.
"Option Plan" shall mean the 1998 Chancellor Media Corporation
Non-Qualified Stock Option Plan, as amended from time to time, and any successor
thereto.
"Options" shall mean the non-qualified stock options to be
granted to the Executive hereunder.
"Permanent Disability" shall mean the Executive's inability to
perform the duties contemplated by this Agreement by reason of a physical or
mental disability or infirmity which has continued for more than ninety (90)
working days (excluding vacation) in any twelve (12) consecutive month period as
determined by the Board. The Executive agrees to submit such medical evidence
regarding such disability or infirmity as is reasonably requested by the Board.
"Related Parties" shall mean with respect to any person (a)
the spouse and lineal ascendants and descendants of such person, and any sibling
of any of such persons and (b) any trust, corporation, partnership or other
entity, the beneficiaries, stockholders, partners, owners or persons
beneficially holding an eighty percent (80%) or more controlling interest of
which consist of persons referred to in subsection (a) above.
"Termination of Employment" shall mean the first to occur of
the following events:
(a) the date of death of the Executive;
(b) the effective date specified in the Company's
written notice to the Executive of the termination of his
employment as a result of his Permanent Disability, which
effective date shall not be earlier than the ninety-first
(91st) working day (excluding vacation) following the
commencement of the Executive's inability to perform his
duties hereunder;
(c) the effective date specified in the Company's
written notice to the Executive of the Company's termination
of his employment without Cause;
(d) the effective date specified in the Company's
written notice to the Executive of the Company's termination
of his employment for Cause;
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(e) the effective date specified in the Executive's
written notice to the Company of the Executive's termination
of his employment for Good Reason;
(f) the effective date specified in the Executive's
written notice to the Company of the Executive's termination
of his employment without Good Reason; and
(g) the date the Executive's employment terminates
pursuant to Section 2.
"Termination without Cause" shall mean a termination by the
Company of the Executive's employment without Cause.
2. EMPLOYMENT
The Company agrees to continue the employment of the
Executive, and the Executive agrees to continue to provide services to the
Company from the date of this Agreement until the close of business on the fifth
(5th) anniversary of the Effective Date (the "Expiration Date"), unless the
Executive's employment is earlier terminated pursuant to a Termination of
Employment. The Executive will serve the Company subject to the general
supervision, advice and direction of the Board and the Chief Executive Officer
and upon the terms and conditions set forth in this Agreement.
3. TITLE AND DUTIES
(a) The Executive's job title shall be Senior Vice President
and Assistant to the President of the Company. During the Employment Term, the
Executive shall have such authority and duties as are usual and customary for
similar positions within the Company, and shall perform such additional services
and duties as the Chief Executive Officer may from time to time designate
consistent with such position.
(b) The Executive shall report solely to the Chief Executive
Officer.
(c) The Executive shall devote his full business time and best
efforts to the business affairs of the Company; however, the Executive may
devote reasonable time and attention to serving as a director of, or member of a
committee of the directors of, any corporations or organizations so long as such
activities do not interfere unreasonably with the Executive's duties hereunder
or any not-for-profit organization, or engaging in other charitable or community
activities.
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(d) Throughout the Employment Term, the Executive shall serve
on the Management Committee of the Company.
4. COMPENSATION AND BENEFITS
(a) Base Compensation. During the Employment Term, the Company
shall pay the Executive, in installments according to the Company's regular
payroll practice, Base Salary at the annual rate of Five Hundred Thousand
Dollars ($500,000) for the first (1st) Contract Year; and subject to increase
for each subsequent Contract Year an amount equal to the product of
(i) the Base Salary for the immediately preceding
Contract Year; and
(ii) the ratio of the Consumer Price Index for the
last complete calendar month in such preceding Contract Year
to the Consumer Price Index for the same month in the year
preceding such preceding Contract Year;
provided, however, that in no event shall the Base Salary in any subsequent
Contract Year be less than the Base Salary in the immediately preceding Contract
Year.
(b) Annual Incentive Bonus. The Executive shall be entitled to
an Annual Bonus for each calendar year during which he is employed hereunder of
up to 100% of the Executive's Base Salary in effect at the end of the applicable
calendar year (or for the final calendar year within the Employment Term, in
effect at the end of the Employment Term), subject to increases at the
discretion of the Compensation Committee based upon the recommendation of the
Chief Executive Officer of the Company. For each such calendar year one-half of
the Annual Bonus shall be based upon the Executive's performance and one-half of
the Annual Bonus shall be discretionary, in each case as measured against
standards and budgets to be mutually agreed between the Executive and the Chief
Executive Officer, with the amounts of the bonuses to be determined by the
Compensation Committee based upon the recommendation of the Chief Executive
Officer of the Company; provided, however, that the Annual Bonus for any partial
calendar year shall be adjusted pro rata for the portion of the calendar year
contained within the Employment Term. The Executive's Annual Bonus earned with
respect to each calendar year shall be paid at the same time as annual incentive
bonuses with respect to that calendar year are paid to other senior executives
of the Company generally, but in no event later than March 31 of the following
calendar year.
(c) Stock Options.
(i) On the Effective Date and each of the first four
(4) anniversaries of the Effective Date on which the Executive
remains employed hereunder, the Executive shall
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be granted an Option to purchase Forty Thousand (40,000)
shares of Common Stock. In the event the Executive's
employment hereunder is terminated by the Company without
Cause or by the Executive for Good Reason prior to the
Expiration Date, the Executive shall be granted, as of the
date of such Termination of Employment, a number of Options
equal to Two Hundred Thousand (200,000) minus the number of
Options previously granted pursuant to the immediately
preceding sentence.
(ii) All Options described in paragraph (i) above
shall be granted subject to the following terms and
conditions: (A) the Options shall be granted under and subject
to the Option Plan; (B) the exercise price of the Options
shall be, (1) in the case of the Options granted on the
Effective Date, $29.875 and (2) in the case of the Options
granted thereafter, the last reported sale price of the Common
Stock on the Nasdaq National Market System (or other principal
trading market for the Common Stock) at the close of the
trading day immediately preceding the date as of which the
grant is made; provided, however, that with respect to any
Options the grant of which is accelerated because the
Executive's employment is terminated either by the Company or
the Executive as a result of a Change in Control, the exercise
price of such Options shall be the lower of (x) the exercise
price equal to the average last reported sale price on the
Nasdaq National Market System (or other principal trading
market for the Common Stock) for the 30 trading days prior to
the ten trading days ending at the close of the trading day
immediately preceding the date on which any announcement of
such Change in Control is made and (y) an exercise price equal
to the last reported sale price of the Common Stock on the
Nasdaq National Market System (or other principal trading
market for the Common Stock) at the close of the trading day
immediately preceding the date as of which the grant is made;
(C) twenty-five percent (25%) of the Options shall vest on
each of the first four (4) annual anniversaries of the date of
grant if and to the extent that a Termination of Employment
has not occurred, provided that in the event of a Contract
Non-Renewal, all such Options shall vest and become
exercisable on the Expiration Date and in the event of a
Termination of Employment by the Executive for Good Reason or
a Termination of Employment by the Company other than for
Cause, all such Options shall vest and become exercisable on
the date of such Termination of Employment; (D) each Option
shall be exercisable for the ten (10) year period following
the date of grant; (E) each Option shall be evidenced by, and
subject to, an Option Agreement; and (F) the number of shares
granted shall be subject to adjustment for any subsequent
stock splits.
(iii) Except as otherwise provided in paragraph (ii)
above, the Option Agreements shall specify that such Options
shall remain exercisable for the periods described in
paragraph (ii) above notwithstanding any Termination of
Employment, other than a Termination of Employment by the
Company for Cause.
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(d) Vacation. During each complete twelve (12) month period of
the Employment Term, the Executive shall be entitled to no fewer than four (4)
weeks of paid vacation (unless, based on his length of service with the Company
and his position with the Company, the Executive is entitled to a greater number
of weeks of paid vacation under the Company's generally applicable vacation
policy, as determined by the Compensation Committee).
(e) Employee Benefit Plans. During the Employment Term, the
Executive shall be entitled to participate in all pension, profit sharing and
other retirement plans, all incentive compensation plans and all group health,
hospitalization and disability insurance plans and other employee welfare
benefit plans in which other senior executives of the Company may participate on
terms and conditions no less favorable than those which apply to such other
senior executives of the Company.
(f) Company Payment of Health Benefit Coverage. During the
Employment Term, the Company shall pay the amount of premiums or other cost
incurred for coverage of the Executive and his eligible spouse and dependent
family members under the applicable Company health benefits arrangement
(consistent with the terms of such arrangement).
(g) Life Insurance Policy. In addition to the insurance
coverage contemplated by Section 4(e), during the Employment Term the Company
shall maintain in effect term life insurance coverage for the Executive with a
death benefit of at least Five Hundred Thousand Dollars ($500,000), subject to
the Executive's insurability at standard rates and with the beneficiary or
beneficiaries, thereof designated by the Executive. Notwithstanding Section 9 of
this Agreement, such life insurance policy or policies may be assigned to a
trust for the benefit of any beneficiary designated by the Executive.
(h) Automobile and Parking Allowance; Other Benefits.
(i) During the Employment Term, the Company shall (A)
either provide the Executive with, or pay or reimburse the
Executive for his purchase or lease of an automobile selected
by the Executive with a retail sales price of not more than
Seventy Thousand Dollars ($70,000), which automobile may be
traded no more frequently than every three (3) years, and (B)
pay all insurance and all other expenses related to the
business operation of such automobile.
(ii) During the Employment Term, the Company shall
reimburse the Executive for the monthly membership fees in
connection with (A) the membership of the Executive and his
spouse and dependent family members in the country club of
Executive's choosing, and (B) the membership of the Executive
and his spouse and dependent family members in an athletic
club of Executive's choosing.
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(i) Execution Bonus. The Executive shall be paid or granted,
as the case may be, the following Employment Inducements in connection with the
execution of this Agreement:
(i) Within fifteen (15) days after the execution and
delivery of this Agreement, the Company shall pay to the
Executive a one-time execution bonus in the gross amount of
One Million Dollars ($1,000,000);
(ii) The Executive shall be granted an option to
purchase Two Hundred Thousand (200,000) shares of Common Stock
(collectively, the "Execution Options"), subject to the
following terms and conditions: (A) the Execution Options
shall be granted under and subject to the Option Plan; (B) the
exercise price of the Execution Options shall be $29.875; (C)
twenty-five percent (25%) of the Execution Options shall vest
on the Effective Date and twenty-five percent (25%) of the
Execution Options shall vest on each of the first three (3)
annual anniversaries of the date of grant if and to the extent
that a Termination of Employment has not occurred, provided
that in the event of a Termination of Employment by the
Executive for Good Reason or a Termination of Employment by
the Company other than for Cause, all such Execution Options
shall vest and become exercisable on the date of such
Termination of Employment; (D) each Execution Option shall be
exercisable for the ten (10) year period following the date of
grant; (E) each Execution Option shall be evidenced by, and
subject to, an Option Agreement; and (F) the number of shares
granted shall be subject to adjustment for any subsequent
stock splits; and
(iii) Except as otherwise provided in paragraph (ii)
above, the Option Agreements shall specify that the Execution
Options shall remain exercisable for the periods described in
paragraph (ii) above notwithstanding any Termination of
Employment, other than a Termination of Employment by the
Company for Cause.
5. REIMBURSEMENT OF EXPENSES
In addition to the compensation provided for under Section 4
hereof, upon submission of proper vouchers, the Company will pay or reimburse
the Executive for all normal and reasonable travel and entertainment expenses
incurred by the Executive during the Employment Term in connection with the
Executive's responsibilities to the Company.
6. TERMINATION BENEFITS
(a) Upon the termination of the Executive's employment with
the Company for any reason, the Company shall provide the Executive (or, in the
case of his death, his estate or other legal representative), (i) any Annual
Bonus earned but not yet paid with respect
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to the preceding calendar year, (ii) all benefits due him under the Company's
benefits plans and policies for his services rendered to the Company prior to
the date of such termination (according to the terms of such plans and
policies), (iii) not later than ninety (90) days after such termination, in a
lump sum, all Base Salary earned through the date of such termination, and (iv)
not later than ninety (90) days after such termination, in a lump sum, any
Annual Bonus earned with respect to that portion of the calendar year prior to
such termination.
(b) In the event that the Executive's employment hereunder is
terminated by the Company without Cause or by the Executive for Good Reason (but
not by reason of expiration or non-renewal of this Agreement), and subject to
the last sentence of this subsection (b), the Company shall make a one-time cash
payment to the Executive in a gross amount such that the net payments retained
by the Executive after payment of any applicable Excise Tax with respect to such
payment shall equal two times the Executive's Base Salary then in effect. Such
payment shall be made at the time of any such termination without Cause or
within thirty (30) days of any such resignation for Good Reason. Such payment
shall be in full satisfaction of all obligations of the Company to Executive
hereunder (other than those obligations set forth in Sections 4(c), 4(i)(ii) and
6(a)) and shall be conditioned on Executive giving a general release of the
Company and affiliates in the form used generally by the Company in the case of
the termination of employment of senior executives.
(c) (i) In the event that the Executive elects to
terminate his employment hereunder other than for Good Reason,
the Company, in consideration for the Executive's agreement in
Section 7(b), shall continue to pay him one-half of his Base
Salary as set forth in Section 4(a) through the earlier of (A)
the fifth (5th) anniversary of the Effective Date or (B) the
second (2nd) anniversary of such termination of employment
(the earlier of such dates, the "Cessation Date").
(ii) In addition, in such event, the Company may,
by written notice to the Executive given no later than 15 days
following his termination of employment, elect to require the
Executive to observe the provisions of Section 7(c) hereof. In
such event, the Company shall, on the last day of each
calendar year preceding the Cessation Date, make a payment to
him equal to one-half of his Average Bonus, and on the last
day of the calendar year which includes the Cessation Date
make a payment to him equal to the product of one-half of his
Average Bonus and the fraction of such calendar year which
precedes the Cessation Date.
(d) In the event of any Termination of Employment, the
Executive shall not be required to seek other employment to mitigate damages,
and any income earned by the Executive from other employment or self-employment
shall not be offset against any obligations of the Company to the Executive
under this Agreement.
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7. PROTECTED INFORMATION; PROHIBITED SOLICITATION
(a) The Executive hereby recognizes and acknowledges that
during the course of his employment by the Company, the Company will furnish,
disclose or make available to the Executive confidential or proprietary
information related to the Company's business, including, without limitation,
customer lists, ideas and formatting and programming concepts and plans, that
such confidential or proprietary information has been developed and will be
developed through the Company's expenditure of substantial time and money, and
that all such confidential information could be used by the Executive and others
to compete with the Company. The Executive hereby agrees that all such
confidential or proprietary information shall constitute trade secrets, and
further agrees to use such confidential or proprietary information only for the
purpose of carrying out his duties with the Company and not to disclose such
information unless required to do so by subpoena or other legal process. No
information otherwise in the public domain (other than by an act of the
Executive in violation hereof) shall be considered confidential.
The Executive further agrees that all memoranda, notices,
files, records and other documents concerning the business of the Company, made
or compiled by the Executive during the period of his employment or made
available to him, shall be the Company's property and shall be delivered to the
Company upon its request therefor and in any event upon the termination of the
Executive's employment with the Company, provided, however, that the Executive
shall be permitted to retain copies of personal correspondence generated or
received by him during the Employment Term, subject to the use restrictions of
this Section 7(a).
(b) The Executive hereby agrees, in consideration of his
employment hereunder and in view of the confidential position to be held by the
Executive hereunder, that after any Termination of Employment, and through the
Cessation Date the Executive will not directly or indirectly induce any employee
of any of the Protected Companies (as defined below) to terminate such
employment or to become employed by any other media company.
(c) Should the Company make the election set forth in Section
6(c)(ii), the Executive further agrees that, from and after the Termination of
Employment and through the Cessation Date, he shall not be employed by or
perform activities on behalf of, or have an ownership interest in, (i) any radio
or television broadcasting station or outdoor advertising company serving the
same "Area of Dominant Influence" (as reported by Arbitron or any comparable
service) as any of the radio or television broadcasting stations or outdoor
advertising company owned by the Company or its subsidiaries or affiliates, or
the subsidiaries or affiliates of any of the Company's direct or indirect
stockholders owning more than twenty percent (20%) of the Company (collectively
the "Protected Companies"), or (ii) any person, firm, corporation or other
entity, or in connection with any business enterprise, that is directly or
indirectly engaged in any of the radio, television, outdoor advertising or
related business activities in which the Company and its subsidiaries or the
Protected Companies have
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significant involvement (collectively, the "Competing Business Areas"), in each
case at the effective time of such Termination of Employment (other than
beneficial ownership of up to five percent (5%) of the outstanding voting stock
of a publicly traded company that owns such a competitor).
(d) The restrictions in this Section 7, to the extent
applicable, shall survive the termination of this Agreement and shall be in
addition to any restrictions imposed upon the Executive by statute or at common
law.
(e) The parties hereby acknowledge that the restrictions in
this Section 7 have been specifically negotiated and agreed to by the parties
hereto and are limited only to those restrictions necessary to protect the
Protected Companies from unfair competition. The parties hereby agree that if
the scope or enforceability of any provision, paragraph or subparagraph of this
Section 7 is in any way disputed at any time, and should a court find that such
restrictions are overly broad, the court may modify and enforce the covenant to
the extent that it believes to be reasonable under the circumstances. Each
provision, paragraph and subparagraph of this Section 7 is separable from every
other provision, paragraph, and subparagraph and constitutes a separate and
distinct covenant. The Executive acknowledges that the Protected Companies
operate in major and medium sized markets throughout the United States and that
the effect of Section 7(c) may be to prevent him from working in the Competing
Business Areas after his termination of employment hereunder for the period
specified thereunder.
8. INJUNCTIVE RELIEF
The Executive hereby expressly acknowledges that any breach or
threatened breach by the Executive of any of the terms set forth in Section 7 of
this Agreement may result in significant and continuing injury to the Company,
the monetary value of which would be impossible to establish. Therefore, the
Executive agrees that the Company shall be entitled to apply for injunctive
relief in a court of appropriate jurisdiction.
The provisions of this Section 8 shall survive the Employment Term.
9. PARTIES BENEFITED; ASSIGNMENTS
This Agreement shall be binding upon the Executive, his heirs
and his personal representative or representatives, and upon the Company and Los
Angeles and their respective successors and assigns. Neither this Agreement nor
any rights or obligations hereunder may be assigned by the Executive, other than
by will or by the laws of descent and distribution. From and after the
consummation of the Capstar Merger, all rights and obligations of the
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Company under this Agreement shall be assigned to and assumed by the New
Chancellor. The consummation of the Capstar Merger shall not constitute a Change
in Control.
10. NOTICES
Any notice required or permitted by this Agreement shall be in
writing, sent by registered or certified mail, return receipt requested,
addressed to the Board and the Company at its then principal office, or to the
Executive at the address set forth in the preamble, as the case may be, or to
such other address or addresses as any party hereto may from time to time
specify in writing for the purpose in a notice given to the other parties in
compliance with this Section 10. Notices shall be deemed given when received.
11. GOVERNING LAW
This agreement shall be governed by and construed and enforced
in accordance with the laws of the State of Texas, without regard to conflict of
law principles.
12. INDEMNIFICATION AND INSURANCE; LEGAL EXPENSES
The Company shall indemnify the Executive to the fullest
extent permitted by the laws of the State of Delaware, as in effect at the time
of the subject act or omission, and shall advance to the Executive reasonable
attorneys' fees and expenses as such fees and expenses are incurred (subject to
an undertaking from the Executive to repay such advances if it shall be finally
determined by a judicial decision which is not subject to further appeal that
the Executive was not entitled to the reimbursement of such fees and expenses)
and he will be entitled to the protection of any insurance policies the Company
may elect to maintain generally for the benefit of its directors and officers
("Directors and Officers Insurance") against all costs, charges and expenses
incurred or sustained by him in connection with any action, suit or proceeding
to which he may be made a party by reason of his being or having been a
director, officer or employee of the Company or any of its subsidiaries or his
serving or having served any other enterprise as a director, officer or employee
at the request of the Company (other than any dispute, claim or controversy
arising under or relating to this Agreement). The Company covenants to maintain
during the Employment Term for the benefit of the Executive (in his capacity as
an officer and director of the Company) Directors and Officers Insurance
providing benefits to the Executive no less favorable, taken as a whole, than
the benefits provided to the Executive by the Directors and Officers Insurance
maintained by the Company on the date hereof; provided, however, that the Board
may elect to terminate Directors and Officers Insurance for all officers and
directors, including the Executive, if the
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Board determines in good faith that such insurance is not available or is
available only at unreasonable expense.
13. REPRESENTATIONS AND WARRANTIES OF THE EXECUTIVE
The Executive represents and warrants to the Company that (a)
the Executive is under no contractual or other restriction which is inconsistent
with the execution of this Agreement, the performance of his duties hereunder or
the other rights of Company hereunder, and (b) the Executive is under no
physical or mental disability that would hinder the performance of his duties
under this Agreement.
14. DISPUTES
Any dispute or controversy arising under, out of, in
connection with or in relation to this Agreement shall, at the election and upon
written demand of either the Executive or the Company, be finally determined and
settled by arbitration in the city of the Company's headquarters in accordance
with the rules and procedures of the American Arbitration Association, and
judgment upon the award may be entered in any court having jurisdiction thereof.
The Company shall pay the costs and expenses of such arbitration and the fees of
the Executive's counsel and experts unless the finder of fact determines that
the Company is the prevailing party in such arbitration.
15. FACILITY OF PAYMENT
All cash payments to be made by the Company to or on behalf of
the Executive hereunder shall be an obligation of and made by Los Angeles.
16. MISCELLANEOUS
The provisions of this Agreement shall survive the termination
of the Executive's employment with the Company. This Agreement contains the
entire agreement of the parties relating to the subject matter hereof. This
Agreement supersedes any prior written or oral agreements or understandings
between the parties relating to the subject matter hereof. No modification or
amendment of this Agreement shall be valid unless in writing and signed by or on
behalf of the parties hereto. A waiver of the breach of any term or condition of
this Agreement shall not be deemed to constitute a waiver of any subsequent
breach of the same or any other term or condition. This Agreement is intended to
be performed in accordance with, and only to the extent permitted by, all
applicable laws, ordinances, rules and regulations. If
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any provision of this Agreement, or the application thereof to any person or
circumstance, shall, for any reason and to any extent, be held invalid or
unenforceable, such invalidity and unenforceability shall not affect the
remaining provisions hereof and the application of such provisions to other
persons or circumstances, all of which shall be enforced to the greatest extent
permitted by law. The compensation provided to the Executive pursuant to this
Agreement shall be subject to any withholdings and deductions required by any
applicable tax laws. Any amounts payable under this Agreement to the Executive
after the death of the Executive shall be paid to the Executive's estate or
legal representative. The headings in this Agreement are inserted for
convenience of reference only and shall not be a part of or control or affect
the meaning of any provision hereof. This Agreement may be executed in any
number of counterparts, each of which when so executed shall be an original, but
such counterparts shall together constitute one and the same agreement.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have duly executed and
delivered this Agreement as of the date first written above.
CHANCELLOR MEDIA CORPORATION
CHANCELLOR MEDIA CORPORATION OF
LOS ANGELES
By: /s/ XXXXXXX X. XXXXXX
---------------------------------------
Xxxxxxx X. Xxxxxx
President and Chief Executive Officer
/s/ XXXXXX X. XXXXXXXX
------------------------------------------
Xxxxxx X. XxXxxxxx
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