Exhibit 10.17
MANAGEMENT AGREEMENT
DATED AS OF
MARCH 30, 1999
BY AND BETWEEN
WESTWOOD ONE, INC.
AND
INFINITY BROADCASTING CORPORATION
C:\DATA\XXXXX\#366415 v4.rtf
EXECUTION COPY
MANAGEMENT AGREEMENT
THIS MANAGEMENT AGREEMENT (this "Agreement") is dated as of
March 30, 1999, and effective as of March 31, 1999 (the "Effective Date"), by
and between Westwood One, Inc., a Delaware corporation (the "Company"), and
Infinity Broadcasting Corporation, a Delaware corporation ("Manager").
W I T N E S S E T H:
WHEREAS, the Company and Manager have entered into a
Management Agreement, dated as of February 3, 1994 and amended as of December
16, 1996 and March 31, 1997 (as so amended, the "Existing Management
Agreement"), which agreement is scheduled to expire as of March 30, 1999; and
WHEREAS, the Company and Manager desire to continue the
relationship existing pursuant to the Existing Management Agreement in
accordance with the terms and conditions set forth herein; and
WHEREAS, concurrently with the execution of this Agreement,
the Company and Manager have entered into an Amended and Restated Representation
Agreement (the "Representation Agreement") pursuant to which the Company will
provide certain services to Manager with respect to Manager's news, sports and
other programming provided to affiliated radio stations nationwide;
NOW, THEREFORE, in consideration of the foregoing premises and
the covenants and agreements contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
Article I
MANAGEMENT SERVICES
Section 1.1 Management Services. Manager shall, during the
term of this Agreement, manage the business and operations of the Company by
providing individuals to serve as the Chief Executive Officer ("CEO") and Chief
Financial Officer ("CFO") of the Company. The CEO and CFO shall be persons who,
in the reasonable judgment of Manager, are qualified to serve in such positions
and who are approved by the Board of Directors, such approval not to be
unreasonably withheld. In their capacities as CEO and CFO, any such individuals
provided by Manager shall have the authority and responsibility normally
attendant to such office and (i) in the case of the CEO, will, among other
things, be responsible and subject to the authority of the Board of Directors of
the Company (the "Board of Directors"), for all operations and functions of the
Company, recommendations for strategic direction and the general implementation
of the Company's business or operating plan and (ii) in the case of the CFO,
will among other things, be responsible and subject to the authority of the CEO
and the Board of Directors. Manager shall also provide support and
administrative personnel required by the CEO and CFO.
Such management shall be performed by Manager (i) with such
care as a prudent manager would use in the conduct of his company's affairs and
(ii) with a view to maximizing the long-term value of the Company. The
management to be performed by Manager pursuant to this Section 1.1 is herein
sometimes referred to as the "Management Services". The Management Services
shall not include the exercise by the Company of its rights and obligations
under this Agreement, which rights and obligations shall be exercised and
performed by, or as directed by, the Board of Directors.
Section 1.2 Manager Employees. Manager will, in performing the
Management Services, make available and use the services of the individuals
described in Section 1.1 (who may be, but shall not be required to be, officers
or employees of Manager, prior to the time of selection by Manager but who will
become officers or employees of Manager at or prior to the time of commencement
of services to the Company) and such officers and other employees of Manager as
may be necessary, together with officers and other employees of the Company, to
perform the Management Services. It is understood and agreed that the support
and administrative personnel described in Section 1.1 and any such other
officers and other employees of Manager so made available and used will continue
to be employees of Manager and not of the Company and that Manager, and not the
Company, will be responsible for their salary, employee benefits and related
costs. The Company acknowledges and agrees that such officers and other
employees of Manager shall continue to perform services for Manager and that
they will devote only so much of their time to the business of the Company as is
necessary for Manager to perform the Management Services hereunder.
Section 1.3 Supervisory Role of Board of Directors. The
providing of Management Services by Manager hereunder shall always be subject to
the direction and supervision of the Board of Directors.
Section 1.4 Information.
(a) During the term of this Agreement, Manager and the Company
shall each, at the reasonable request of the other, supply the other with the
information requested in connection with the performance of the Management
Services.
(b) Manager shall, or shall cause the CEO or CFO to, notify
the Board of Directors as promptly as practicable after the occurrence of any of
the following:
(i) receipt by Manager of any written notice from any
governmental agency of any claim or legal process or
notification that, in the reasonable opinion of
Manager, is or is likely to become material to the
Company; or
(ii) any other development that, in the reasonable opinion
of Manager, materially affects or is likely to
materially affect the Company or the ability of Manager
to fulfill its obligations under this Agreement.
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Section 1.5 Compliance with Applicable Law. Manager will
perform the Management Services in compliance in all material respects with
applicable law.
Section 1.6 Reimbursement for Expenses. The compensation to be
paid to Manager as provided in Article II does not include, and the Company
agrees to promptly reimburse Manager for, all out-of-pocket expenses incurred by
Manager in performing the Management Services consistent with past practice, but
not including (a) the salaries, employee benefits and related costs of the
individuals provided by Manager pursuant to Section 1.1 and officers and other
employees of Manager made available and used as provided in Article I or (b)
office and other overhead expenses of Manager.
Section 1.7 Arm's Length Transactions Between the Company and
Manager. Notwithstanding any other provision of this Agreement, (a) all
transactions between the Company and Manager or any of its affiliates, including
without limitation any transactions regarding use of programming, sales
commissions, compensation to radio stations or the employment or compensation of
talent, shall be on a basis that is at least as favorable to the Company as if
the Company were to obtain the products or services to which such transactions
relate from an independent third party and (b) with the exception of those
arrangements which Manager may enter into pursuant to the authority granted by
the Board of Directors to Manager in accordance with Schedule 1.7 hereof, all
agreements, arrangements or understandings between Manager or any affiliate of
Manager and the Company must be approved in advance by the Board of Directors,
including any transfer of significant functions from the Company to Manager or
any affiliate of Manager. At each meeting of the Board of Directors, Manager
shall review with the Board of Directors any such agreements, arrangements or
understandings that are proposed to be entered into by the Company and Manager
or any affiliate of Manager.
Section 1.8 Indemnification.
(a) The Company agrees to indemnify and hold Manager and its
directors, officers, employees and agents (collectively, the "Indemnified
Parties") harmless from and against any and all actions, claims, damages, and
liabilities (and all actions in respect thereof and any legal or other expenses
in giving testimony or furnishing documents in response to a subpoena or
otherwise and whether or not a party thereto), whether or not arising out of
third party claims, including reasonable legal fees and expenses in connection
with, and other costs of, investigating, preparing or defending any such action
or claim or enforcing its rights under this Agreement, whether or not in
connection with litigation in which an Indemnified Party is a party, and as and
when incurred, caused by, relating to, based upon or arising out of (directly or
indirectly) such Indemnified Party's acceptance of or the performance of its
obligations under this Agreement or otherwise relating to the Company or the
Company's business, assets or properties; provided, however, that such indemnity
shall not apply to any such action, claim, damage, liability or cost to the
extent such action, claim, damage, liability or cost has been finally
adjudicated by a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of the Indemnified Parties (including any
consultants, independent contractors or other third parties engaged by them if,
but only if, the Indemnified Parties were grossly negligent in selecting such
third parties) or a material breach of this Agreement by Manager; provided
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further, however, that neither (i) the taking of any action by Manager directed
by the Board of Directors to be taken by Manager nor (ii) the failure of Manager
to take action specifically recommended to the Board of Directors by Manager
that the Board of Directors directed Manager not to take, shall, for purposes of
the preceding provision or Section 1.9, constitute gross negligence, willful
misconduct or a material breach of this Agreement by Manager.
(b) If any action, proceeding or investigation is commenced
for which an Indemnified Party proposes to demand such indemnification, it will
notify the Company with reasonable promptness; provided, however, that any
failure by an Indemnified Party to notify the Company will not relieve the
Company from its obligations hereunder, except to the extent that such failure
shall have prejudiced the defense of such action. The Company shall promptly pay
expenses reasonably and actually incurred by an Indemnified Party (including the
reasonable fees and expenses of counsel) in investigating, defending or settling
any action, proceeding or investigation in which an Indemnified Party is a party
or is threatened to be made a party or otherwise involved therewith by reason of
its relationship with the Company hereunder or otherwise, in advance of the
final disposition of such action, proceeding, or investigation upon submission
of invoices therefor. Manager, on behalf of each Indemnified Party, hereby
undertakes, and the Company hereby accepts its undertaking, to repay any and all
such amounts so advanced if it shall ultimately be determined that such
Indemnified Party is not entitled to be indemnified therefor. If any such
action, proceeding, or investigation in which an Indemnified Party is a party is
also against the Company, the Indemnified Party may provide the Company with
legal representation by the same counsel who represents the Indemnified Party;
provided, however, that if such counsel or counsel to such Indemnified Party
shall determine that due to the existence of actual or potential conflicts of
interest between such Indemnified Party and any one or more of the Company or
its subsidiaries, such counsel is unable to represent both the Indemnified Party
and one or more of the Company or its subsidiaries, then the Company shall be
entitled to use separate counsel of its own choice, and shall bear full
responsibility for all reasonable expenses of such separate counsel. Nothing
herein shall prevent the Company from using separate counsel of its own choice
at its own expense. The Company shall only be liable for settlements of claims
against any Indemnified Party made with the Company's written consent, which
consent shall not be unreasonably withheld. The Indemnifying Party shall not, in
defense of any such claim involving an Indemnified Party, except with the prior
written consent of such Indemnified Party, consent to the entry of any judgment
or enter into any settlement that does not include as an unconditional term
thereof the giving by the claimant or plaintiff in question to such Indemnified
Party and any affiliates of such Indemnified Party and any affiliates of such
Indemnified Party named in such claim of an unqualified release of all
liabilities in respect of such claims.
Section 1.9 Limitation on Manager's Liability. Notwithstanding
any provision to the contrary in this Agreement, Manager shall have no liability
to the Company hereunder for its failure to perform its obligations under this
Agreement except to the extent that any such failure has been finally
adjudicated by a court of competent jurisdiction to have resulted from the gross
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negligence or willful misconduct of, or a material breach of its obligations
under this Agreement by, Manager, subject to the last proviso of Section 1.8(a).
Section 1.10 Directors and Officers Insurance; Indemnification
of Individual Officers. The Company shall provide the individuals serving in the
capacities specified in Section 1.1 with (a) the coverage available to the
senior officers of the Company under the Company's policies of directors and
officers insurance, if any, and (b) the indemnification provided by the
Company's by-laws and Certificate of Incorporation available to the senior
officers of the Company. In addition, the Company shall enter into an
Indemnification Agreement substantially in the form of Exhibit A hereto with
each of the CEO and CFO (the "Indemnification Agreements"). The indemnity
provided for in such Indemnification Agreements shall not be deemed exclusive
of, or dependent or conditional upon, any other indemnity obligations running to
either the CEO or CFO, nor shall any indemnity obligations which may arise if
the Company and the CEO or CFO enter into a separate indemnification agreement
(whether in the form of Exhibit A or otherwise) be deemed exclusive of, or
dependent or conditional upon, the indemnity obligations contained in this
Agreement.
Article II
COMPENSATION TO MANAGER
Section 2.1 Base Management Fee.
(a) The Company shall pay to the Manager a base management fee
at the rate of $2,500,000 annually (subject to increase as provided in paragraph
(b) below), which shall be payable in advance in monthly installments on the
first business day of each month (prorated for any partial month).
(b) The dollar amount of the base management fee (and the
installment payments thereof) set forth in paragraph (a) above shall be
increased, effective as of each anniversary of the Effective Date, beginning
April 1, 2000, by a percentage amount equal to the percentage increase in the
Consumer Price Index All Urban Consumers (Los Angeles-Anaheim-Riverside area;
base 1982-1984=100) as published by the United States Department of Labor,
Bureau of Labor Statistics as of such anniversary of the Effective Date compared
to such index as in effect on the date hereof. The base management fee, as
adjusted from time to time, shall hereinafter be referred to as the "Base Fee."
Section 2.2 Bonus Warrants.
As additional compensation to the Manager hereunder, the
Company has, concurrently with the execution of this Agreement, executed and
delivered to Manager, two warrants, each substantially in the form of Exhibit B
hereto (each a "Warrant" and, collectively, the "Warrants"), granting Manager
the right to purchase (i) an aggregate of 1,000,000 shares of common stock, par
value $.01 per share, of the Company (the "Common Stock") at a price of $20.00
per share if the Market Price (as defined in the Warrants) per share of Common
Stock is at least $30.00 on at least twenty (20) out of thirty (30) consecutive
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days during which the national securities exchanges are open for trading and
(ii) an aggregate of 1,000,000 shares of Common Stock at a price of $25.00 per
share if the Market Price per share of Common Stock is at least $40.00 on at
least twenty (20) out of thirty (30) consecutive days during which the national
securities exchanges are open for trading.
Article III
TERM OF AGREEMENT; EARLY TERMINATION
Section 3.1 Term of Agreement. The term of this Agreement
commences on the date of this Agreement and will end on the fifth anniversary of
the date of this Agreement, unless terminated earlier pursuant to Section 3.2
hereof.
Section 3.2 Early Termination.
(a) The Company may terminate the term of this Agreement
without cause at any time, by specifying a termination date in a written notice
of termination to Manager given by the Board of Directors on behalf of the
Company not later than 30 days prior to the date of termination. Upon any
termination of this Agreement by the Company under this Section 3.2(a), Manager
shall be entitled to the payment of the Base Fee, payable in the manner set
forth in Section 2.1, for the remaining term of this Agreement and Manager's
rights to purchase shares of Common Stock pursuant to the Warrants shall
immediately vest.
(b) The Company may terminate the term of this Agreement by a
unanimous vote of the members of the Board of Directors who are not designees or
employees of the Manager or any of its affiliates, if Manager shall have
willfully committed a material act of fraud or gross misconduct in performing
its obligations hereunder, and such act first occurs during the term of this
Agreement and has a material adverse effect upon the business of the Company,
which date of termination shall be specified in a written notice of termination
to Manager given by the Board of Directors not later than ninety (90) days prior
to such date of termination, which notice specifies in reasonable detail the
basis, pursuant to this Section 3.2(b), for such termination.
(c) The term of this Agreement shall terminate forthwith upon
notice from the Company to Manager if:
(i) Manager shall (A) apply for or consent to the
appointment of, or the taking of possession by, a
receiver, custodian, trustee or liquidator of itself or
of all or a substantial part of its property, (B) make
a general assignment for the benefit of its creditors,
(C) commence a voluntary case under the Bankruptcy Code
(as now or hereafter in effect), (D) file a petition
seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, winding-up, or
composition or readjustment of debts, (E) fail to
controvert in a timely and appropriate manner, or
acquiesce in writing to, any petition filed against it
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in an involuntary case under the Bankruptcy Code, or
(F) take any corporate action for the purpose of
effecting any of the foregoing; or
(ii) a proceeding or case shall be commenced, without the
application or consent of Manager, in any court of
competent jurisdiction, seeking (A) its liquidation,
reorganization, dissolution or winding-up, or the
composition or readjustment of its debts, (B) the
appointment of a trustee, receiver, custodian,
liquidator or the like of Manager or of all or any
substantial part of its assets, or (C) similar relief
in respect of Manager under any law relating to
bankruptcy, insolvency, reorganization, winding-up, or
composition or adjustment of debts, and such proceeding
or case shall continue undismissed, or an order,
judgment or decree approving or ordering any of the
foregoing shall be entered and continue unstayed and in
effect, for a period of sixty (60) or more days; or an
order for relief against Manager shall be entered in an
involuntary case under the Bankruptcy Code.
(d) Immediately upon any termination of this Agreement
pursuant to Sections 3.2(b) or 3.2(c), Manager (i) shall be entitled to any
accrued and unpaid compensation owed to Manager pursuant to the terms of this
Agreement through the date of such termination, (ii) shall retain all rights in
and to the Warrants to the extent that such Warrants have become exercisable
pursuant to the terms thereof through the date of such termination and (iii)
shall forfeit all rights in and to the Warrants to the extent that such Warrants
have not become exercisable pursuant to the terms thereof through the date of
such termination.
Section 3.3 Survival and Termination. The provisions of
Sections 1.6, 1.8, 1.9, 1.10, 3.2(a), 3.2(d) and 4.1 (to the extent provided
therein) shall survive the termination of this Agreement pursuant to this
Article III. Except as provided in Section 3.2(d) hereof, upon any termination
of this Agreement pursuant to Sections 3.2(b) or 3.2(c), the Company shall have
no further obligations to compensate Manager pursuant to the terms of this
Agreement.
Article IV
NONCOMPETITION; RIGHT OF FIRST REFUSAL; NOTIFICATION OF STOCK PURCHASES
Section 4.1 Noncompetition, Etc.
(a) Except pursuant to this Agreement or as otherwise approved
by the Board of Directors, Manager will, and will cause its affiliates and its
and their officers and any of their employees that are provided to the Company
pursuant to Sections 1.1 or 1.2 to, refrain from, either alone or in conjunction
with any other person, or directly or indirectly through its or their present or
future affiliates:
(i) during the term of this Agreement, managing,
purchasing, establishing, participating in, or having a
substantial ownership interest in (other than through
the ownership of five percent (5%) or less of any class
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of securities registered under the Securities Exchange
Act of 1934, as amended), or otherwise lending
assistance (financial or otherwise) to, a radio network
company (which, for purposes of this Agreement, shall
mean any compensation-based radio network that is
RADAR-rated) or any other radio syndicator (a "Radio
Network Company"), or entering into, or obtaining
rights under, any agreement providing for an option to
do any of the foregoing, provided, however, that if
this Agreement is terminated by the Company pursuant to
Section 3.2(b), this clause (i) shall be applicable for
a period of two (2) years after such termination of
this Agreement so long as the Company continues to pay
Manager the Base Fee for such period after termination;
provided further, however, that the terms of this
Section 4.1(a)(i) shall not apply to any activities
engaged in (A) by Manager with respect to Manager owned
and operated stations, or (B) (at the time of
acquisition) by any entity which is acquired by Manager
or a Manager Subsidiary after the date of this
Agreement, provided that such entity, or the activities
in conflict with this Section 4.1(a)(i), are divested
or discontinued by Manager or such Manager Subsidiary
by the later of (i) one (1) year after the date such
entity is acquired or (ii) as soon as reasonably
practicable pursuant to an orderly process whereby
Manager or such Manager Subsidiary is able to realize
the fair value for such operations (such value to be
reasonably determined by Manager), but in no event more
than two (2) years after the date such entity is
acquired;
(ii) disclosing (unless compelled by judicial or
administrative process) or using any confidential or
secret information relating to the Company or any of
its clients, customers or suppliers, except, during the
term of this Agreement, as Manager reasonably
determines to be necessary in connection with the
performance of Manager's obligations under this
Agreement and in the best interest of the Company; or
(iii) during the term of this Agreement, causing or
attempting to cause (A) any client, customer or
supplier of the Company to terminate or materially
reduce its business with the Company or (B) any
officer, employee or consultant (other than the CEO,
CFO or any support or administrative personnel provided
by Manager pursuant to Sections 1.1 and 1.2 hereof) of
the Company or any Subsidiary to resign or sever a
relationship with the Company; provided, however, that
if this Agreement is terminated by the Company pursuant
to Section 3.2(b), this clause (iii) shall be
applicable for a period of two (2) years after such
termination.
(b) The parties hereto recognize that the laws and public
policies of the various states of the United States may differ as to the
validity and enforceability of covenants similar to those set forth in this
Section 4.1. It is the intention of the parties that the provisions of this
Section 4.1 be enforced to the fullest extent permissible under the laws and
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policies of each jurisdiction in which enforcement may be sought, including
through judicial modification of the provisions of this Section 4.1 in order to
conform such section to provide for its enforceability to the maximum extent
permissible, and that the unenforceability (or the modification to conform to
such laws or policies) of any provisions of this Section 4.1 shall not render
unenforceable, or impair, the remainder of the provisions of this Section 4.1.
Accordingly, if any provision of this Section 4.1 shall be determined to be
invalid or unenforceable, such invalidity or unenforceability shall be deemed to
apply only with respect to the operation of such provision in the particular
jurisdiction in which such determination is made and not with respect to any
other provision or jurisdiction.
(c) The parties hereto acknowledge and agree that any remedy
at law for any breach of the provisions of this Section 4.1 may be inadequate,
and Manager hereby consents to the granting by any court of an injunction or
other equitable relief without the necessity of actual monetary loss being
proved, in order that the breach or threatened breach of such provisions may be
effectively restrained.
Section 4.2 Right of Refusal as to Certain Programming.
Manager agrees that, unless Manager is contractually prohibited from doing so,
before it or any or its affiliates offers, sells or otherwise makes available
for syndication any radio programming featuring talent employed by or otherwise
under contract with Manager or its affiliates (other than Xxxxxx Xxxxx)
("Syndications"), Manager shall, subject to Section 4.3, first offer (by written
notice to the Board of Directors, which notice shall describe the nature of such
Syndications and the terms and conditions on which Manager or such Manager
Subsidiary intends so to offer, sell or otherwise make available such
Syndications, in reasonable detail) such Syndications to the Company on the same
terms and conditions (adjusted to reflect the fact that the Company would become
the prospective buyer of such Syndications) as Manager or such affiliate intends
so to offer, sell or otherwise make available such Syndications. If the Board of
Directors, acting on behalf of the Company, fails to accept such offer by
written notice to Manager within ten (10) business days after notice is given by
Manager, Manager or such Manager Subsidiary, as the case may be, may, for a
period of one hundred and eighty (180) days thereafter, offer, sell or otherwise
make available such Syndications to one or more third parties on terms and
conditions no more favorable to the third party than those specified in such
notice to the Board of Directors, but not otherwise, provided, however, the
rights of the Company and the obligations of Manager under this Section 4.2
shall terminate upon the end of the term of this Agreement as to any offer made
to the Company pursuant to this Section 4.2 that is not so accepted by the Board
of Directors, acting on behalf of the Company, prior to the end of the term of
this Agreement. If the Board of Directors, acting on behalf of the Company,
accepts such offer during the term of this Agreement, Manager, acting on its own
behalf and, pursuant to Article I hereof, on behalf of the Company will cause
the transaction to be consummated, subject to the approval of any agreements in
respect thereof by the Board of Directors.
Section 4.3 Existing Contracts Excluded. Notwithstanding the
provisions of Section 4.1 or 4.2, Manager and each Manager Subsidiary may honor
any contracts that any of them has entered into prior to the date hereof
regarding programming or other services with other companies in the radio
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broadcast industry and any renewals or extensions thereof on commercially
reasonable terms.
Section 4.4 Notice of Purchase of Securities
(a) During the term of this Agreement, if either Manager or
any of its affiliates determines to purchase (other than from the Company) any
securities of the Company such that, after such purchase, Manager and its
affiliates would beneficially own in the aggregate (taking into account the
exercise of the Warrants and any other options, warrants or other convertible
securities held by Manager or its affiliates) more than 32.88% of the
Outstanding Common Stock (as defined below), then, subject to Section 4.4(b),
Manager shall provide written notice to the Company at least five (5) business
days, prior to effecting such purchase. Such notice shall state the number of
shares of Common Stock that Manager or its affiliates intend to purchase.
(b) Notwithstanding the foregoing, if, in Manager's good faith
judgment, the five (5) business days notice required by subsection (a) could
reasonably be expected to adversely effect Manager's or its affiliate's ability
to purchase, in a privately-negotiated transaction, any securities of the
Company, or the price at which any such purchase is to be effected, then such
five (5) business days period shall be reduced to two (2) business days. In such
event, Manager's written notice shall specify in reasonable detail (subject to
confidentiality restrictions) the circumstances requiring the reduced notice
period.
(c) The provisions of this Section 4.4 shall be applicable to
successive 10% increases (if any) in the beneficial ownership of Common Stock by
Manager and its affiliates. Accordingly, if Manager and its affiliates purchase
(other than from the Company) shares of Common Stock such that they beneficially
own in the aggregate more than 32.88% of the Outstanding Common Stock, notice
shall again be required under this Section 4.4 if Manager or its affiliates
determine to purchase (other than from the Company) additional shares of Common
Stock such that, after such purchase, such beneficial ownership would exceed
42.88% of the Outstanding Common Stock; provided, however, that only one notice
shall be required notwithstanding that a proposed purchase would result in the
crossing of two or more such 10% thresholds (e.g., if a purchase were to result
in an increase in such beneficial ownership from 22.88% to 49%).
(d) For a period of ninety (90) days following any notice
given by Manager to the Company in accordance with this Section 4.4, Manager
shall have the right, in its sole and absolute discretion, to purchase all or
any part of the Common Stock for which notice was duly given. If Manager shall
elect not to purchase all or any part of such Common Stock within such
ninety-day period for any reason whatsoever, then such notice period shall lapse
and Manager shall be required to comply with the provisions of this Section 4.4
in connection with further acquisitions of the Common Stock.
(e) Nothing in this Section 4.4 shall be deemed to grant to
the Company the right to approve any acquisition of Common Stock by Manager or
any of its affiliates or any right of first offer, first refusal or first
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negotiation in respect of any shares proposed to be acquired, nor shall Manager
be required to disclose to the Company any confidential information concerning
any proposed purchase of Common Stock. The Company shall, and shall cause its
officers, directors, employees and representatives to, not disclose to any third
party (other than the Company's legal and financial advisors, who shall be
advised of the confidential nature of such information) either the fact that
Manager or its affiliate proposes to purchase additional shares of Common Stock
or that a notice has been delivered pursuant to this Section 4.4 (or the
contents of any such notice), or any other information provided by Manager to
the Company or any of its officers, directors, employees or representatives in
connection with any such proposed purchase; provided, that the Company or its
Board of Directors may make such disclosures as are required by applicable law,
rule or regulation.
(f) "Outstanding Common Stock" means, as of any date of
determination, the aggregate number of shares of Common Stock then outstanding
on a fully-diluted basis (calculated without giving effect to the treasury stock
method) taking into account any and all options, warrants or other rights
requiring the Company to issue any shares of Common Stock, and any other
securities of the Company then outstanding and exercisable or exchangeable for,
or convertible into, any shares of Common Stock.
Article V
REPRESENTATIONS AND WARRANTIES
Section 5.1 Representations and Warranties of Each Party. Each
of the parties hereto represents and warrants to the other that, as of the date
hereof:
(a) it is duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is formed and has all
requisite corporate authority to own its property and assets and to conduct its
business as presently conducted or proposed to be conducted under this
Agreement;
(b) it has the corporate power and authority to execute,
deliver and perform its obligations under this Agreement;
(c) all necessary action has been taken to authorize its
execution, delivery and performance of this Agreement and this Agreement
constitutes its legal, valid and binding obligation enforceable against it in
accordance with its respective terms, except as such enforcement may be limited
by applicable bankruptcy, insolvency, moratorium and other similar laws
affecting the rights of creditors generally and by general principles of equity;
(d) neither its execution and delivery of this Agreement nor
the performance of its obligations hereunder will:
(i) conflict with or violate any provision of its
certificate of incorporation or by-laws;
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(ii) conflict with, violate or result in a breach of any
constitution, law, judgment, regulation or order of any
governmental authority applicable to it; or
(iii) conflict with, violate or result in a breach of or
constitute a default under or result in the imposition
or creation of any mortgage, pledge, lien, security
interest or other encumbrance under any term or
condition of any mortgage, indenture, loan agreement or
other agreement to which it is a party or by which its
properties or assets are bound;
(e) no approval, authorization, order or consent of, or
declaration, registration or filing with any governmental authority or third
party is required for its valid execution, delivery and performance of this
Agreement, except such as have been duly obtained or made; and
(f) there is no action, suit or proceeding, at law or in
equity, by or before any court, tribunal or governmental authority or third
party pending, or, to its knowledge, threatened, which, if adversely determined,
would materially and adversely affect its ability to perform its obligations
hereunder or the validity or enforceability of this Agreement.
Article VI
MISCELLANEOUS
Section 6.1 Notices. All notices, requests and other
communications hereunder must be in writing and will be deemed to have been duly
given only if delivered personally or by facsimile transmission (with receipt
acknowledged) or mailed (first class postage prepaid) to the parties at the
following addresses or facsimile numbers:
If to the Company:
Westwood One, Inc.
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Legal Dept.
Telecopy: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. XxXxxxxx, Esq.
Telecopy: (000) 000-0000
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If to Manager:
Infinity Broadcasting Corporation
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxx Xxxxxxx
Telecopy: (000) 000-0000
with a copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxxxxx, Esq.
Telecopy: (000) 000-0000
All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided in this Section, be deemed given upon confirmation of transmission, and
(iii) if delivered by mail in the manner described above to the address as
provided in this Section, be deemed given upon receipt (in each case regardless
of whether such notice, request or other communication is received by any other
person to whom a copy of such notice, request or other communication is to be
delivered pursuant to this Section). Any party from time to time may change its
address, facsimile number or other information for the purpose of notices to
that party by giving notice specifying such change to the other parties hereto.
Section 6.2 Entire Agreement; Effective Date. This Agreement,
the Representation Agreement and the Warrants supersede all prior discussions
and agreements between the parties (and their affiliates) with respect to the
subject matter hereof and contain the sole and entire agreement between the
parties hereto with respect to the subject matter hereof. This Agreement will
automatically become effective, without further action of the parties, on the
Effective Date, whereupon, except as provided in Section 3.4 thereof, the
Existing Management Agreement shall terminate and be superseded in its entirety.
Section 6.3 Waiver. Any term or condition of this Agreement
may be waived at any time by the party that is entitled to the benefit thereof,
but no such waiver shall be effective unless set forth in a written instrument
duly executed by or on behalf of the party waiving such term or condition. No
waiver by any party of any term or condition of this Agreement, in any one or
more instances, shall be deemed to be or construed as a waiver of the same or
any other term or condition of this Agreement on any future occasion. All
remedies, either under this Agreement or by law or otherwise afforded, will be
cumulative and not alternative.
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Section 6.4 Amendment. This Agreement may be amended,
supplemented or modified only by a written instrument duly executed by or on
behalf of each party hereto.
Section 6.5 No Third-Party Beneficiary. Except as provided in
Section 1.8 hereof, the terms and provisions of this Agreement are intended
solely for the benefit of each party hereto and their respective successors or
permitted assigns, and it is not the intention of the parties to confer
third-party beneficiary rights upon any other person.
Section 6.6 No Assignment; Binding Effect. Neither this
Agreement nor any right, interest or obligation hereunder may be assigned by
either party hereto without the prior written consent of the other party hereto
and any attempt to do so will be void, except for assignments and transfers by
operation of law. Subject to the preceding sentence, this Agreement is binding
upon, inures to the benefit of and is enforceable by, the parties and their
respective successors and assigns.
Section 6.7 No Mitigation. In the event of a breach of this
Agreement by either party, the other party shall have no duty or obligation to
mitigate damages. Any benefits received by Manager before or after the breach,
expiration or termination of this Agreement shall in no way reduce or otherwise
affect the Company's obligation to make payments and afford benefits hereunder
or the Company's liability for damages by virtue of any breach hereof.
Section 6.8 Attorneys' Fees. In the event that any legal
action or other proceeding is brought for enforcement of this Agreement, the
prevailing party or parties will be entitled to recover from the other party or
parties to such action or proceeding reasonable attorneys' fees and other costs
incurred in connection with that action or proceeding, and in any petitions or
appeals therefrom, in addition to any other relief to which such party may be
entitled.
Section 6.9 Headings. The headings used in this Agreement have
been inserted for convenience of reference only and do not define or limit the
provisions hereof.
Section 6.10 Invalid Provisions. If any provision of this
Agreement, other than Section 4.1(a), which shall be subject to the provisions
of Sections 4.1(b) and 4.1(c), is held to be illegal, invalid or unenforceable
under any present or future law, and if the rights or obligations of any party
hereto under this Agreement will not be materially and adversely affected
thereby, (a) such provision will be fully severable, (b) this Agreement will be
construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a part hereof, (c) the remaining provisions of this
Agreement will remain in full force and effect and will not be affected by the
illegal, invalid or unenforceable provision or by its severance herefrom and (d)
in lieu of such illegal, invalid or unenforceable provision, there will be added
automatically as a part of this Agreement a legal, valid and enforceable
provision as similar in terms to such illegal, invalid or unenforceable
provision as may be possible.
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Section 6.11 Affiliate. When used in this Agreement the term
"affiliate" shall have the meaning assigned to such term in Rule 405 promulgated
under the Securities Act of 1933, as amended.
Section 6.12 Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of Delaware.
Section 6.13 Counterparts. This Agreement may be executed in
any number of counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Management Agreement to be executed on its behalf by its duly authorized officer
as of the date first above written.
WESTWOOD ONE, INC.
By: /s/ Xxxx Xxxxx
----------------------------------------
Name: Xxxx Xxxxx
Title: Senior Vice President - Finance
INFINITY BROADCASTING CORPORATION
By: /s/ Xxxxx Xxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxx
Title: Chief Financial Officer
