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EXHIBIT 10.5
THIS OPTION AND THE SHARES OF COMMON STOCK PURCHASABLE HEREUNDER HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES
LAWS OF ANY STATE OR OTHER JURISDICTION AND MAY NOT BE SOLD, OFFERED FOR SALE OR
OTHERWISE TRANSFERRED UNLESS REGISTERED OR QUALIFIED UNDER SAID ACT AND
APPLICABLE STATE SECURITIES LAWS OR UNLESS THE COMPANY RECEIVES AN OPINION OF
COUNSEL IN REASONABLY ACCEPTABLE FORM AND SCOPE REASONABLY SATISFACTORY TO THE
COMPANY THAT REGISTRATION, QUALIFICATION OR OTHER SUCH ACTIONS ARE NOT REQUIRED
UNDER ANY SUCH LAWS. THE OFFERING OF THIS SECURITY HAS NOT BEEN REVIEWED OR
APPROVED BY ANY STATE'S SECURITIES ADMINISTRATOR.
STOCK OPTION GRANT AGREEMENT
GRANTED TO: Xxxxx, Muse & Co. Partners, L.P.,
a Texas limited partnership
DATE OF GRANT: July 13, 1999
NUMBER OF UNDERLYING SHARES: 634,517 shares
EXERCISE PRICE: $52.00 per share
VESTING SCHEDULE: As described in Paragraph 4 below
This Stock Option Grant Agreement (this "Option") is made and entered
into as of July 13, 1999 (the "Date of Grant") between Chancellor Media
Corporation, a Delaware corporation to be renamed AMFM Inc. (the "Company"), and
Xxxxx, Muse & Co. Partners, L.P., a Texas limited partnership (the "Holder").
Certain terms used in this Option are defined in Paragraph 16.
1. Grant. The Holder is granted an option to purchase 634,517 shares
(the "Option Shares") of the common stock, par value $.01 per share ("Common
Stock"), of the Company. The Option granted hereunder is in consideration for
the termination of the Monitoring and Oversight Agreement dated July 1, 1997,
between Capstar Broadcasting Corporation, a Delaware corporation and
wholly-owned subsidiary of the Company, and Grantee, on the date hereof.
2. Exercise Price. The Option's exercise price is $52.00 per share
(the "Exercise Price").
3. Term. The Option, unless sooner terminated or exercised in full,
shall expire at 5:00 p.m., Dallas, Texas time, on the later to occur of (a) July
13, 2004 or (b) the 90th day after this Option becomes exercisable. No portion
of the Option may be exercised after such date.
4. Vesting and Exercisability. The Option Shares shall be fully
vested on the Date of Grant. The Option shall become exercisable to acquire
Option Shares at any time or from time to time after the first to occur of (i) a
Change in Control or (ii) the date on which the average Fair
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Market Value of the Common Stock, calculated on a daily basis (when added to any
cash consideration attributable to any prior Capital Reorganization), equals or
exceeds $100.00 per share (the "Exercisability Value") for a period of 30
consecutive days (excluding non-Business Days for purposes of calculating the
average Fair Market Value during such 30-day period) during the period from (and
including) the Date of Grant through (and including) the fifth anniversary of
the Date of Grant. Upon the completion of a Common Stock Reorganization, the
Exercisability Value shall be adjusted, effective immediately after the record
date at which the holders of shares of Common Stock are determined for purposes
of such Common Stock Reorganization, to a dollar amount determined by
multiplying the Exercisability Value in effect immediately prior to such record
date by a fraction, the numerator of which shall be the number of shares of
Common Stock outstanding on such record date before giving effect to such Common
Stock Reorganization and the denominator of which shall be the number of shares
of Common Stock outstanding after giving effect to such Common Stock
Reorganization.
5. Impact of Other Options. If this Option becomes exercisable,
the Holder may exercise this Option in whole or in part regardless of whether
any other stock option that the Holder has been granted by the Company remains
unexercised.
6. Method of Exercise.
(a) To exercise this Option in whole or in part, the Holder
shall deliver to the Company, at the Option Agency, (i) this Option, (ii) a
written notice, in substantially the form of the Subscription Notice attached
hereto as Annex A, of such Holder's election to exercise this Option, which
notice shall specify (A) the number of Option Shares to be purchased, (B) the
denominations of the share certificate or certificates desired, and (C) the name
or names in which such certificates are to the registered, (iii) if the Common
Stock to be received upon the exercise of this Option has not been registered
under the Securities Act, a written certification in substantially the form of
the Certification attached hereto as Annex B, and (iv) payment of the Exercise
Price with respect to such Option Shares. Such payment may be made, at the
option of the Holder, by cash, money order, certified or bank cashier's check or
wire transfer; provided, however, that if this Option is exercised after the
occurrence of a Change in Control that is also a Capital Reorganization in which
cash is received by the stockholders of the Company, then the Holder may elect
to offset the amount of cash due to the Holder from such Capital Reorganization
against the Exercise Price payable upon exercise of this Option.
The Company shall, as promptly as practicable and in any event within
five Business Days thereafter, execute and deliver or cause to be executed and
delivered, in accordance with such notice, a certificate or certificates
representing the aggregate number of Option Shares specified in said notice. The
share certificate or certificates so delivered shall be in such denominations as
may be specified in such notice or, if such notice shall not specify
denominations, shall be in the amount of the number of Option Shares for which
the Option is being exercised, and shall be issued in the name of the Holder or
such other name or names as shall be designated in such notice. Such certificate
or certificates shall be deemed to have been issued, and such Holder or any
other Person so designated to be named therein shall be deemed for all purposes
to have become a Holder of record of such shares, as of the date the
aforementioned notice is received by the Company. If this Option
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shall have been exercised only in part, the Company shall, at the time of
delivery of the certificate or certificates, deliver to the Holder a new Option
evidencing the right to purchase the remaining Option Shares called for by this
Option, which new Option shall in all other respects be identical with this
Option, or, at the request of the Holder, appropriate notation may be made on
this Option which shall then be returned to the Holder. The Company shall pay
all expenses, taxes (if any) and other charges payable in connection with the
preparation, issuance and delivery of share certificates and a new Option,
except that, if share certificates or a new Option shall be registered in a name
or names other than the name of the Holder, funds sufficient to pay all transfer
taxes payable as a result of such transfer shall be paid by the Holder at the
time of delivering the aforementioned notice of exercise or promptly upon
receipt of a written request of the Company for payment.
(b) Shares To Be Fully Paid and Nonassessable. All shares of
Common Stock issued upon the exercise of this Option shall be validly issued,
fully paid and nonassessable and free from all preemptive rights of any
stockholder, and from all taxes.
(c) No Fractional Shares To Be Issued. The Company shall not
be required to issue fractions of shares of Common Stock upon exercise of this
Option. If any fraction of a share would, but for this Paragraph, be issuable
upon any exercise of this Option, in lieu of such fractional share the Company
shall pay to the Holder, in cash, an amount equal to such fraction of the Fair
Market Value per share of Common Stock of the Company on the Business Day
immediately prior to the date of such exercise.
(d) Restrictive Legend. If the Company, in its sole
discretion, shall determine that it is necessary, to comply with applicable
securities laws, the certificate or certificates representing the Option Shares
purchased pursuant to the exercise of this Option shall bear an appropriate
legend, in form and substance as determined by the Company, giving notice of
applicable restrictions on transfer under or with respect to such laws.
(e) Reservation; Authorization. The Company has reserved and
will keep available for issuance upon exercise of this Option the total number
of shares of Common Stock deliverable upon exercise of this Option from time to
time outstanding. The issuance of such shares has been duly and validly
authorized and, when issued and sold in accordance with this Option, such shares
will be duly and validly issued, fully paid and nonassessable.
7. Option Agency; Transfer; Exchange and Replacement of Option.
(a) Option Agency. At any time, the Company may appoint and
thereafter maintain, at its own expense, an agency in New York, New York, which
agency may be the Company's then existing transfer agent (the "Option Agency"),
for certain purposes specified herein, and shall give prompt notice of such
appointment (and appointment of any successor Option Agency) to the Holder.
Until an independent Option Agency is so appointed, the Company shall perform
the obligations of the Option Agency provided herein at its address as specified
on the signature page hereto or such other address as the Company shall specify
by notice to the Holder.
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(b) Ownership of Option. The Company may deem and treat the
Person in whose name this Option is registered as the Holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by any Person
other than the Option Agency) for all purposes and shall not be affected by any
notice to the contrary, until presentation of this Option for registration of
transfer as provided in this Paragraph 7.
(c) Transfer of Option. The Company agrees to maintain at the
Option Agency books for the registration of transfers of the Options, and
transfer of this Option and all rights hereunder shall be registered, in whole
or in part, on such books, upon surrender of this Option at the Option Agency,
together with a written assignment of this Option duly executed by the Holder or
his or its duly authorized agent or attorney, with (unless the Holder is the
original Holder or another institutional investor) signatures guaranteed by a
bank or trust company or a broker or dealer registered with the NASD, and funds
sufficient to pay any transfer taxes payable upon such transfer. Upon surrender
the Company shall execute and deliver a new Option or Options in the name of the
assignee or assignees and in the denominations specified in the instrument of
assignment, and this Option shall promptly be canceled. The Option Agency shall
not be required to register any transfers if the Holder fails to furnish to the
Company, after a request therefor, an opinion of counsel (who may be an employee
of such Holder) reasonably satisfactory to the Company that such transfer is
exempt from the registration requirements of the Securities Act and applicable
blue sky laws.
(d) Division of Option. This Option may be divided upon
surrender hereof to the Option Agency, together with a written notice specifying
the names and denominations in which the new Options are to be issued, signed by
the Holder. Subject to compliance with Paragraph 7(c) as to any transfer which
may be involved in the division, the Company shall execute and deliver new
Options in exchange for the Option or Options to be divided in accordance with
such notice.
(e) Loss, Theft, Destruction or Mutilation of Options. Upon
receipt of evidence satisfactory to the Company of the loss, theft, destruction
or mutilation of this Option and, in the case of any such loss, theft or
destruction, upon receipt of indemnity or security reasonably satisfactory to
the Company, or, in the case of any such mutilation, upon surrender and
cancellation of such Option, the Company will make and deliver, in lieu of such
lost, stolen, destroyed or mutilated Option, a new Option of like tenor and
representing the right to purchase the same aggregate number of shares of Common
Stock as provided for in such lost, stolen, destroyed or mutilated Option.
(f) Expenses of Delivery of Options. The Company shall pay all
expenses, taxes (other than transfer taxes) and other charges payable in
connection with the preparation, issuance and delivery of this Option and the
Common Stock issuable hereunder.
8. Stockholders Agreement. The Common Stock issuable upon
exercise of this Option is subject to the Stockholders Agreement. The Company
shall keep a copy of the Stockholders Agreement, and any amendments thereto, at
the Option Agency and shall furnish copies thereof to the Holder upon request.
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9. No Rights as a Stockholder. The Holder shall not have any of
the rights of a stockholder with respect to the Option Shares until the Option
is exercised and the Holder receives such shares in accordance with the terms
hereof.
10. Anti-Dilution Provisions.
(a) Adjustments Generally. The Exercise Price and the number
of Option Shares (or other securities or property) issuable upon exercise of the
Option shall be subject to adjustment from time to time upon the occurrence of
certain events, as provided in this Paragraph 10.
(b) Common Stock Reorganization. If the Company shall after
the date of issuance of the Option subdivide its outstanding shares of Common
Stock into a greater number of shares or consolidate its outstanding shares of
Common Stock into a lesser number of shares, whether by way of a stock dividend
or stock split or otherwise (any such event being called a "Common Stock
Reorganization"), then (i) the Exercise Price shall be adjusted, effective
immediately after the record date at which the holders of shares of Common Stock
are determined for purposes of such Common Stock Reorganization, to a price
determined by multiplying the Exercise Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the number of shares
of Common Stock outstanding on such record date before giving effect to such
Common Stock Reorganization and the denominator of which shall be the number of
shares of Common Stock outstanding after giving effect to such Common Stock
Reorganization, and (ii) the number of shares of Common Stock subject to
purchase upon exercise of the Option shall be adjusted, effective at such time,
to a number determined by multiplying the number of shares of Common Stock
subject to purchase immediately before such Common Stock Reorganization by a
fraction, the numerator of which shall be the number of shares outstanding after
giving effect to such Common Stock Reorganization and the denominator of which
shall be the number of shares of Common Stock outstanding immediately before
such Common Stock Reorganization.
(c) Capital Reorganization. If after the date of issuance of
the Option there shall be any consolidation or merger to which the Company is a
party (whether or not the Company is the surviving entity), other than a
consolidation or a merger in which the Company is a continuing corporation and
which does not result in any reclassification of, or change (other than a Common
Stock Reorganization or a change in par value), in, outstanding shares of Common
Stock, any sale, assignment, lease, exchange, conveyance or other transfer (in
one transaction or series of related transactions) of the property of the
Company as an entirety or substantially as an entirety or all or substantially
all of the outstanding equity securities of the Company to any person or group
of related persons for the purposes of Section 13(d) of the Exchange Act, or any
dividend or distribution of assets (including securities of subsidiaries of the
Company) other than regular cash dividends (any such event, other than a Common
Stock Reorganization, being called a "Capital Reorganization"), then, effective
upon the effective date of such Capital Reorganization, the Holder shall have
the right to purchase or receive, upon exercise of the Option, the kind and
amount of shares of stock and other securities and property (including cash)
which the Holder would have owned or have been entitled to receive after such
Capital Reorganization if the Option had been exercised immediately prior to
such Capital Reorganization. If the Capital Reorganization is a distribution of
options or rights to purchase or receive securities or assets of the Company and
such options or rights expire before this
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Option, the Holder shall be entitled to receive options or rights with terms, as
nearly as possible, identical to the terms of such expired options or rights. As
a condition to effecting any Capital Reorganization, the Company or the
successor or surviving corporation, as the case may be, shall execute and
deliver to the Holder an agreement as to the Holder's rights in accordance with
this Paragraph 10(c), providing for subsequent adjustments as nearly equivalent
as may be practicable to the adjustments provided for in this Paragraph 10(c).
The provisions of this Paragraph 10(c) shall similarly apply to successive
Capital Reorganizations.
(d) Certain Other Events. If any event occurs after the date of
issuance of the Option as to which the foregoing provisions of this Paragraph 10
are not strictly applicable or, if strictly applicable, would not, in the good
faith judgment of the Board of Directors of the Company (the "Board"), fairly
protect the purchase rights of the Holder in accordance with the essential
intent and principles of such provisions, then the Board shall make such
adjustments in the application of such provisions, in accordance with such
essential intent and principles, as shall be reasonably necessary, in the good
faith opinion of the Board, to protect such purchase rights as aforesaid.
(e) Adjustment Rules. (i) Any adjustments pursuant to this Paragraph 10
shall be made successively whenever an event referred to herein shall occur.
(ii) If the Company shall set a record date to
determine the holders of shares of Common Stock for purposes of a Common Stock
Reorganization or Capital Reorganization, and shall legally abandon such action
prior to effecting such action, then no adjustment shall be made pursuant to
this Paragraph 10 in respect of such action.
(iii) No adjustment in the Exercise Price shall be
made hereunder if such adjustment would reduce the exercise price to an amount
below par value of the Common Stock, which par value shall initially be $.01 per
share of Common Stock.
(f) Notice of Adjustment. The Company shall give the Holder
reasonable notice of the record date or effective date, as the case may be, of
any action which requires or might require an adjustment or readjustment
pursuant to this Paragraph 10. Such notice shall describe such event in
reasonable detail and specify the record date or effective date, as the case may
be, and, if determinable, the required adjustment and the computation thereof.
If the required adjustment is not determinable at the time of such notice, the
Company shall give reasonable notice to the Holder of such adjustment and
computation promptly after such adjustment becomes determinable.
11. Notices. All notices, requests, consents and other
communications provided for herein shall be in writing and shall be effective
upon delivery in person, faxed or telecopied, or mailed by certified or
registered mail, return receipt requested, postage pre-paid, to the addresses
specified on the signature pages hereto or, in any case, at such other address
or addresses as shall have been furnished in writing to the Company (in the case
of a Holder) or to the Holder (in the case of the Company) in accordance with
the provisions of this Paragraph.
12. Waivers; Amendments. No failure or delay of the Holder in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any
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such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the Holder are
cumulative and not exclusive of any rights or remedies which it would otherwise
have. The provisions of this Option may be amended, modified or waived with (and
only with) the written consent of the Company and Holders who collectively hold
Options to purchase a majority of the Common Stock subject to purchase upon
exercise of such Options at the time outstanding.
Any such amendment, modification or waiver effected pursuant to this
Paragraph shall be binding upon the Holders, upon each future Holder thereof and
upon the Company. In the event of any such amendment, modification or waiver the
Company shall give prompt notice thereof to all Holders and, if appropriate,
notation thereof shall be made on all Options thereafter surrendered for
registration of transfer or exchange.
No notice or demand on the Company in any case shall entitle the
Company to any other or further notice or demand in similar or other
circumstances.
13. Governing Law. This Option shall be construed in accordance
with and governed by the laws of the State of Delaware.
14. Severability. In case any one or more of the provisions
contained in this Option shall be invalid, illegal or unenforceable in any
respect, the validity, legality or enforceability of the remaining provisions
contained herein and therein shall not in any way be affected or impaired
thereby. The parties shall endeavor in good faith negotiations to replace the
invalid, illegal or unenforceable provisions with valid provisions the economic
effect of which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.
15. Paragraph Headings. The paragraph headings used herein are for
convenience of reference only, are not part of this Option and are not to affect
the construction of or be taken into consideration in interpreting this Option.
16. Certain Defined Terms. The following terms, as used in this
Option, have the following respective meanings:
(a) "Affiliate" means, with respect to any Person, any Person
who, directly or indirectly, controls, is controlled by or is under common
control with that Person.
(b) "Board" shall have the meaning set forth in Paragraph
10(d).
(c) "Business Day" means (i) if any class of common stock of
the Company is listed or admitted to trading on a national securities exchange,
a day on which the principal national securities exchange on which such class of
common stock is listed or admitted to trading is open for business or (ii) if no
class of common stock of the Company is so listed or admitted to trading, a day
on which the New York Stock Exchange is open for business.
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(d) "Capital Reorganization" shall have the meaning set forth
in Paragraph 12(c).
(e) "Change in Control" means (i) 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 Exchange Act); (ii)
the adoption by the stockholders of the Company of a plan relating to the
liquidation or dissolution of the Company; (iii) 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; (iv) 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 (v) the majority of the Board's being
composed of members who (A) have served less than twelve (12) months and (B)
were not approved by a majority of the Board at the time of their election or
appointment.
(f) "Closing Price" with respect to any security on any day
means (a) if such security is listed or admitted for trading on a national
securities exchange, the reported last sales price regular way or, if no such
reported sale occurs on such day, the average of the closing bid and asked
prices regular way on such day, in each case as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which such class of security is
listed or admitted to trading, or (b) if such security is not listed or admitted
to trading on any national securities exchange, the last quoted sales price, or,
if not so quoted, the average of the high bid and low asked prices in the
over-the-counter market on such day as reported by NASDAQ or any comparable
system then in use or, if not so reported, as reported by any New York Stock
Exchange member firm reasonably selected by the Company for such purpose.
(g) "Common Stock" shall have the meaning set forth in
Paragraph 1.
(h) "Common Stock Reorganization" shall have the meaning set
forth in Paragraph 10(b).
(i) "Company" shall have the meaning set forth in the
introductory paragraph.
(j) "Date of Grant" shall have the meaning set forth in the
introductory paragraph.
(k) "Exercisability Value" shall have the meaning set forth in
Paragraph 4(b).
(l) "Exercise Price" shall have the meaning set forth in
Paragraph 1.
(m) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and any similar or successor federal statute, and the rules
and regulations of the Securities and Exchange Commission (or its successor)
thereunder, all as the same shall be in effect at the time.
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(n) "Fair Market Value", with respect to any security on any
day, means the average of the daily Closing Prices of a share or unit of such
security for the 20 consecutive Business Days ending on the most recent Business
Day for which a Closing Price is available; provided, however, that for purposes
of determining Fair Market Value as used in Paragraph 4, "Fair Market Value"
means the daily Closing Price of a share of Common Stock on the date of
determination; provided further, however, that in the event that, in the case of
Common Stock, the Fair Market Value is determined following the announcement by
the Company of any subdivision, combination or reclassification of Common Stock
or the record date for such subdivision, combination or reclassification, then,
and in each such case, the Fair Market Value shall be appropriately adjusted to
reflect the current market price per share equivalent of Common Stock. If a
Closing Price for any security is not available, then "Fair Market Value" shall
mean the fair market value of such security as determined in good faith by the
Board.
(o) "Holder" shall have the meaning set forth in Paragraph 1
and shall also include registered assigns. The term Holders shall refer to all
Holders of Options.
(p) "NASD" means the National Association of Securities
Dealers, Inc.
(q) "NASDAQ" means The National Association of Securities
Dealers, Inc. Automated Quotation System.
(r) "Option" shall have the meaning set forth in the
introductory paragraph. The term Options shall refer to the Options resulting
from any subdivision of this Option.
(s) "Option Agency" shall have the meaning set forth in
Paragraph 7(a).
(t) "Option Shares" shall have the meaning set forth in
Paragraph 1.
(u) "Person" or "person" means any individual, corporation,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof.
(v) "Related Parties" means, with respect to any person (i)
the spouse and lineal ascendants and descendants of such person, and any sibling
of any of such persons and (ii) 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 (i) above.
(w) "Securities Act" means the Securities Act of 1933 and any
similar or successor federal statute, and the rules and regulations of the
Securities and Exchange Commission (or its successor) thereunder, all as the
same shall be in effect at the time.
(x) "Stockholders Agreement" means the Amended and Restated
Stockholders Agreement dated as of February 14, 1996, as it may be amended from
time to time, among the Company (as successor to Chancellor Broadcasting
Company) and the stockholders parties thereto.
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17. Accredited Investor Status. The Holder hereby represents and
warrants to the Company that the Holder is an "Accredited Investor" (as defined
in Rule 501(a) of Regulation D promulgated under the Securities Act).
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the undersigned have executed this Option
as of the date written below.
DATED: July 13, 1999 CHANCELLOR MEDIA CORPORATION
By: /s/
---------------------------------
Xxxxxx X. Xxxxx
Chief Executive Officer
Address: 0000 Xxxxxxx Xxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
ACCEPTED BY:
XXXXX, MUSE & CO. PARTNERS, L.P.
By: HM PARTNERS INC.,
its General Partner
By: /s/
---------------------------------
Name:
-------------------------------
Title:
-------------------------------
Address of Holder:
000 Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
-------------------------------------
Holder Taxpayer Identification Number
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ANNEX A
SUBSCRIPTION NOTICE
(To be executed upon exercise of Option)
TO CHANCELLOR MEDIA CORPORATION:
The undersigned hereby irrevocably elects to exercise the attached
Option and to purchase thereunder _________ shares of Common Stock in payment of
an Exercise Price in an amount equal to $__________.
Please issue a certificate or certificates for such shares of Common
Stock in the following name or names and denominations:
If said number of shares shall not be all the shares issuable upon
exercise of the attached Option, a new Option is to be issued in the name of the
undersigned for the balance remaining of such shares less any fraction of a
share paid in cash.
Dated: ___________________, ______
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Note: The above signature should correspond
exactly with the name on the face of the
attached Option or with the name of the
assignee appearing in the assignment
form below.
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ANNEX B
CERTIFICATION
The undersigned hereby certifies to Chancellor Media Corporation that
he, she or it is:
a. an "accredited investor" as that term is defined in
Regulation D promulgated pursuant to the Securities
Act or any successor regulation, as such provisions
may be in effect on the date hereof, and is an
"accredited investor" pursuant to Rule 501(a) of such
regulation; and
b. is knowledgeable, sophisticated and experienced in
business and financial matters and in securities
similar to the Common Stock; is aware of the
limitation on the transfer of the Common Stock
imposed by applicable securities laws and any
limitations on transfer imposed by contracts with the
Company or others; and has had access to, or been
furnished with, all information about the Common
Stock and the Company deemed necessary to conclude
that he, she or it has the ability to bear the
economic risk of the investment in the Common Stock
and to afford the complete loss of such investment.
IN WITNESS WHEREOF, the undersigned has executed this CERTIFICATION
this _____ day of ________________, _____.
For Individuals: For Entities:
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Signature Printed Name of Entity
By:
----------------------------- ---------------------------------------
Printed Name Name:
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Title:
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