INDEMNIFICATION AGREEMENT
INDEMNIFICATION AGREEMENT, dated as of September 29, 2004, by and
among Citadel Broadcasting Corporation, a Delaware corporation (the
"Company"), Citadel Broadcasting Company, a Nevada corporation and a
wholly-owned subsidiary of the Company, (the "Subsidiary") and the director
and/or officer of the Company whose name appears on the signature page of
this Agreement ("Indemnitee").
RECITALS
A. Highly competent persons are becoming more reluctant to serve
publicly-held corporations as directors or officers or in other capacities
unless they are provided with reasonable protection through insurance or
indemnification against risks of claims and actions against them arising
out of their service to and activities on behalf of the corporations.
B. The Board of Directors of the Company (the "Board") has determined
that the Company should act to assure its directors and officers that there
will be increased certainty of such protection in the future.
C. It is reasonable, prudent and necessary for the Company
contractually to obligate itself to indemnify such persons to the fullest
extent permitted by applicable law so that they will serve or continue to
serve the Company free from undue concern that they will not be so
indemnified.
D. Indemnitee is willing to serve, to continue to serve and to take on
additional service for or on behalf of the Company and/or the Subsidiary on
the condition that Indemnitee be so indemnified.
E. In consideration of the benefits received and to be received by the
Company and/or the Subsidiary in connection with actions taken and to be
taken by the Board and by the officers of the Company, the Company and the
Subsidiary have determined that it is in their best interests for the
reasons set forth above to be a party to this Agreement and to provide
indemnification to the directors and officers of the Company in connection
with their service to and activities on behalf of the Company and the
Subsidiary.
F. The Subsidiary acknowledges that for purposes of this Agreement the
directors and officers of the Company who enter into this Agreement are
serving in such capacities at the request of the Subsidiary.
G. The Subsidiary further acknowledges that such directors and
officers are willing to serve, to continue to serve and to take on
additional service for or on behalf of the Company, thereby benefiting the
Subsidiary, on the condition that the Subsidiary enter into, and provide
indemnification pursuant to, this Agreement.
AGREEMENT
In consideration of the premises and the covenants contained herein,
the Company, Subsidiary and Indemnitee do hereby covenant and agree as
follows:
1. Definitions.
(a) For purposes of this Agreement:
(i) "Affiliate" shall mean any corporation,
partnership, joint venture, trust or other enterprise in respect of which
Indemnitee is or was or will be serving as a director or officer directly
or indirectly at the request of the Company or the Subsidiary, and
including, but not limited to, service with respect to an employee benefit
plan.
(ii) "Disinterested Director" shall mean a director of
the Company who is not or was not a party to the Proceeding in respect of
which indemnification is being sought by Indemnitee.
(iii) "Expenses" shall include all attorneys' fees and
costs, retainers, court costs, transcripts, fees of experts, witness fees,
travel expenses, duplicating costs, printing and binding costs, telephone
charges, postage, delivery service fees and all other disbursements or
expenses incurred in connection with asserting or defending claims.
(iv) "fines" shall include any excise taxes assessed on
Indemnitee with respect to any employee benefit plan.
(v) "Independent Counsel" shall mean a law firm or
lawyer that neither is presently nor in the past year has been retained to
represent: (i) the Company, the Subsidiary or Indemnitee in any matter
material to any such party or (ii) any other party to the Proceeding giving
rise to a claim for indemnification hereunder in any matter material to
such other party. Notwithstanding the foregoing, the term "Independent
Counsel" shall not include any firm or person who, under the applicable
standards of professional conduct then prevailing, would have a conflict of
interest in representing any of the Company, the Subsidiary or Indemnitee
in an action to determine Indemnitee's right to indemnification under this
Agreement. All Expenses of the Independent Counsel incurred in connection
with acting pursuant to this Agreement shall be borne by the Company.
(vi) "Losses" shall mean all expenses, liabilities,
losses and claims (including attorneys' fees, judgments, fines, excise
taxes under the Employee Retirement Income Security Act of 1974, as amended
from time to time, penalties and amounts to be paid in settlement) incurred
in connection with any Proceeding.
(vii) "Proceeding" shall include any threatened,
pending or completed action, suit, arbitration, alternate dispute
resolution mechanism, investigation, administrative hearing or any other
proceeding, whether civil, criminal, administrative or investigative.
(b) For purposes of this Agreement, a person who acted in
good faith and in a manner such person reasonably believed to be in the
interest of the participants and beneficiaries of an employee benefit plan
shall be deemed to have acted in a manner "not opposed to the best
interests of the Company" as referred to in this Agreement; the term
"serving at the request of the Company or the Subsidiary" shall include any
service as a director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director, officer,
employee or agent with respect to an employee benefit plan, its
participants or beneficiaries; and references to the "Company" or the
"Subsidiary" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent of a constituent)
absorbed in a consolidation or merger which, if its separate existence had
continued, would have had power and authority to indemnify Indemnitee in
its capacity as a director, officer, or employee or agent, so that
Indemnitee shall stand in the same position under this Agreement with
respect to the resulting or surviving corporation as Indemnitee would have
with respect to such constituent corporation if its separate existence had
continued.
2. Service by Indemnitee. Indemnitee agrees to begin or continue
to serve the Company or any Affiliate as a director and/or officer.
Notwithstanding anything contained herein, this Agreement shall not create
a contract of employment between the Company or the Subsidiary and
Indemnitee, and the termination of Indemnitee's relationship with the
Company or the Subsidiary or an Affiliate by either party hereto shall not
be restricted by this Agreement.
3. Indemnification. The Company and Subsidiary jointly and
severally agree to indemnify Indemnitee for, and hold Indemnitee harmless
from and against, any Losses or Expenses at any time incurred by or
assessed against Indemnitee arising out of or in connection with the
service of Indemnitee as a director or officer of the Company or of an
Affiliate (collectively referred to as an "Officer or Director of the
Company") to the fullest extent permitted by the laws of the State of
Delaware in effect on the date hereof or as such laws may from time to time
hereafter be amended to increase the scope of such permitted
indemnification. Without diminishing the scope of the indemnification
provided by this Section, the rights of indemnification of Indemnitee
provided hereunder shall include but shall not be limited to those rights
set forth hereinafter.
4. Action or Proceeding Other Than an Action by or in the Right
of the Company or the Subsidiary. Indemnitee shall be entitled to the
indemnification rights provided herein if Indemnitee is a person who was or
is made a party or is threatened to be made a party to or is involved
(including, without limitation, as a witness) in any Proceeding (other than
an action by or in the right of the Indemnitee (unless approved in advance
in writing by the Company's Board of Directors), the Company or the
Subsidiary, as the case may be) by reason of (a) the fact that Indemnitee
is or was an Officer or Director of the Company or any other entity which
Indemnitee is or was or will be serving at the request of the Company or
the Subsidiary, as the case may be, or (b) anything done or not done by
Indemnitee in any such capacity.
5. Actions by or in the Right of the Company. Indemnitee shall be
entitled to the indemnification rights provided herein if Indemnitee is a
person who was or is a party or is threatened to be made a party to or is
involved (including, without limitation, as a witness) in any Proceeding
brought by or in the right of the Company or the Subsidiary to procure a
judgment in its favor by reason of (a) the fact that Indemnitee is or was
an Officer or Director of the Company or any Affiliate, or (b) anything
done or not done by Indemnitee in any such capacity. Pursuant to this
Section, Indemnitee shall be indemnified against Losses or Expenses
incurred or suffered by Indemnitee or on Indemnitee's behalf in connection
with the defense or settlement of any Proceeding if Indemnitee acted in
good faith and in a manner Indemnitee reasonably believed to be in or not
opposed to the best interests of the Company or the Subsidiary.
Notwithstanding the foregoing provisions of this Section, no such
indemnification shall be made in respect of any claim, issue or matter as
to which Delaware law expressly prohibits such indemnification by reason of
an adjudication of liability of Indemnitee to the Company or the Subsidiary
unless and only to the extent that the Court of Chancery of the State of
Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, Indemnitee is fairly and
reasonably entitled to indemnity for such Losses and Expenses which the
Court of Chancery or such other court shall deem proper.
6. Indemnification for Losses and Expenses of Party Who is Wholly
or Partly Successful. Notwithstanding any other provision of this
Agreement, to the extent that Indemnitee has been wholly successful on the
merits or otherwise in any Proceeding referred to in Sections 3, 4 or 5
hereof on any claim, issue or matter therein, Indemnitee shall be
indemnified against all Losses and Expenses incurred by Indemnitee or on
Indemnitee's behalf in connection therewith. If Indemnitee is not wholly
successful in such Proceeding but is successful, on the merits or
otherwise, as to one or more but less than all claims, issues or matters in
such Proceeding, the Company and the Subsidiary jointly and severally agree
to indemnify Indemnitee to the maximum extent permitted by law against all
Losses and Expenses incurred by Indemnitee in connection with each
successfully resolved claim, issue or matter. In any review or Proceeding
to determine the extent of indemnification, the Company shall bear the
burden of proving any lack of success and which amounts sought in indemnity
are allocable to claims, issues or matters which were not successfully
resolved. For purposes of this Section and without limitation, the
termination of any such claim, issue or matter by dismissal with or without
prejudice shall be deemed to be a successful resolution as to such claim,
issue or matter.
7. Payment for Expenses of a Witness. Notwithstanding any other
provision of this Agreement, to the extent that Indemnitee is, by reason of
the fact that Indemnitee is or was an Officer or Director of the Company or
any Affiliate, as the case may be, a witness in any Proceeding, the Company
and the Subsidiary jointly and severally agree to pay to Indemnitee all
Expenses actually and reasonably incurred by Indemnitee or on Indemnitee's
behalf in connection therewith.
8. Advancement of Expenses and Costs. All Expenses incurred by or
on behalf of Indemnitee (or reasonably expected by Indemnitee to be
incurred by Indemnitee within three months) in connection with any
Proceeding shall be paid by the Company or the Subsidiary in advance of the
final disposition of such Proceeding within twenty days after the receipt
by the Company or the Subsidiary of a statement or statements from
Indemnitee requesting from time to time such advance or advances, whether
or not a determination to indemnify has been made under Section 9.
Indemnitee's entitlement to such advancement of Expenses shall include
those incurred in connection with any Proceeding by Indemnitee seeking an
adjudication or award in arbitration pursuant to this Agreement. The
financial ability of Indemnitee to repay an advance shall not be a
prerequisite to the making of such advance. Such statement or statements
shall reasonably evidence such Expenses incurred (or reasonably expected to
be incurred) by Indemnitee in connection therewith and shall include or be
accompanied by a written undertaking by or on behalf of Indemnitee to repay
such amount if it shall ultimately be determined that Indemnitee is not
entitled to be indemnified therefor pursuant to the terms of this
Agreement.
9. Procedure for Determination of Entitlement to Indemnification.
(a) When seeking indemnification under this Agreement (which
shall not include in any case the right of Indemnitee to receive payments
pursuant to Section 7 and Section 8 hereof, which shall not be subject to
this Section 9), Indemnitee shall submit a written request for
indemnification to the Company and the Subsidiary. Determination of
Indemnitee's entitlement to indemnification shall be made promptly, but in
no event later than 60 days after receipt by the Company and the Subsidiary
of Indemnitee's written request for indemnification. The Secretary of the
Company shall, promptly upon receipt of Indemnitee's request for
indemnification, advise the Board that Indemnitee has made such request for
indemnification.
(b) The entitlement of Indemnitee to indemnification under
this Agreement shall be determined, with respect to a person who is a
director or officer at the time of such determination, in the specific case
(1) by the Board of Directors by a majority vote of the Disinterested
Directors, even though less than a quorum, or (2) by a committee of the
Disinterested Directors designated by majority vote of the Disinterested
Directors, even though less than a quorum, or (3) if there are no
Disinterested Directors, or if such Disinterested Directors so direct, by
Independent Counsel, or (4) by the stockholders. The entitlement of the
Indemnitee to indemnification shall be determined with respect to any
person who is not a director or officer at the time of such determination
by any means reasonably determined by the Company.
(c) In the event the determination of entitlement is to be
made by Independent Counsel, such Independent Counsel shall be selected by
the Board and the Board of Directors of the Subsidiary and approved by
Indemnitee. Upon failure of the Board and the Board of Directors of the
Subsidiary to so select such Independent Counsel or upon failure of
Indemnitee to so approve, such Independent Counsel shall be selected by the
American Arbitration Association of New York, New York or such other person
as such Association shall designate to make such selection.
(d) If a determination is made pursuant to Section 9(b) is
that Indemnitee is not entitled to indemnification to the full extent of
Indemnitee's request, Indemnitee shall have the right to seek entitlement
to indemnification in accordance with the procedures set forth in Section
10 hereof.
(e) If a determination with respect to entitlement to
indemnification shall not have been made within 60 days after receipt by
the Company and the Subsidiary of such request, the requisite determination
of entitlement to indemnification shall be deemed to have been made and
Indemnitee shall be absolutely entitled to such indemnification, absent (i)
misrepresentation by Indemnitee of a material fact in the request for
indemnification or (ii) a final judicial determination that all or any part
of such indemnification is expressly prohibited by law.
(f) The termination of any Proceeding by judgment, order,
settlement or conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, adversely affect the rights of Indemnitee
to indemnification hereunder except as may be specifically provided herein,
or create a presumption that Indemnitee did not act in good faith and in a
manner which Indemnitee reasonably believed to be in or not opposed to the
best interests of the Company or the Subsidiary, as the case may be, or
create a presumption that (with respect to any criminal action or
proceeding) Indemnitee had reasonable cause to believe that Indemnitee's
conduct was unlawful.
(g) For purposes of any determination of good faith
hereunder, Indemnitee shall be deemed to have acted in good faith if in
taking such action Indemnitee relied on the records or books of account of
the Company or an Affiliate, including financial statements, or on
information supplied to Indemnitee by the officers of the Company or an
Affiliate in the course of their duties, or on the advice of legal counsel
for the Company or an Affiliate or on information or records given or
reports made to the Company or an Affiliate by an independent certified
public accountant or by an appraiser or other expert selected with
reasonable care to the Company or an Affiliate. The Company shall have the
burden of establishing the absence of good faith. The provisions of this
Section 9(g) shall not be deemed to be exclusive or to limit in any way the
other circumstances in which Indemnitee may be deemed to have met the
applicable standard of conduct set forth in this Agreement.
(h) The knowledge and/or actions, or failure to act, of any
other director, officer, agent or employee of the Company or an Affiliate
shall not be imputed to Indemnitee for purposes of determining the right to
indemnification under this Agreement.
10. Remedies in Cases of Determination Not to Indemnify or to
Advance Expenses.
(a) In the event that (i) a determination is made that
Indemnitee is not entitled to indemnification hereunder, (ii) advances are
not made pursuant to Section 8 hereof or (iii) payment has not been timely
made following a determination of entitlement to indemnification pursuant
to Section 9 hereof, Indemnitee shall be entitled to seek a final
adjudication either through an arbitration proceeding or in an appropriate
court of the State of Delaware or any other court of competent jurisdiction
of Indemnitee's entitlement to such indemnification or advance.
(b) In the event a determination has been made in accordance
with the procedures set forth in Section 9 hereof, in whole or in part,
that Indemnitee is not entitled to indemnification, any judicial proceeding
or arbitration referred to in Section 10(a) shall be de novo and Indemnitee
shall not be prejudiced by reason of any such prior determination that
Indemnitee is not entitled to indemnification, and the Company shall bear
the burdens of proof specified in Sections 6 and 9 hereof in such
proceeding.
(c) If a determination is made or deemed to have been made
pursuant to the terms of Section 9 or 10 hereof that Indemnitee is entitled
to indemnification, the Company and the Subsidiary shall be bound by such
determination in any judicial proceeding or arbitration in the absence of
(i) a misrepresentation of a material fact by Indemnitee or (ii) a final
judicial determination that all or any part of such indemnification is
expressly prohibited by law.
(d) To the extent deemed appropriate by the court, interest
shall be paid by the Company or the Subsidiary, or both, to Indemnitee at a
reasonable interest rate for amounts which the Company or the Subsidiary,
or both, indemnifies or is obliged to indemnify Indemnitee for the period
commencing with the date on which Indemnitee requested indemnification (or
reimbursement or advancement of any Expenses) and ending with the date on
which such payment is made to Indemnitee by the Company or the Subsidiary,
or both.
11. Expenses Incurred by Indemnitee to Enforce this Agreement.
All Expenses incurred by Indemnitee in connection with the preparation and
submission of Indemnitee's request for indemnification hereunder shall be
jointly and severally borne by the Company and the Subsidiary In the event
that Indemnitee is a party to or intervenes in any proceeding in which the
validity or enforceability of this Agreement is at issue or seeks an
adjudication to enforce Indemnitee's rights under, or to recover damages
for breach of, this Agreement, Indemnitee, if Indemnitee prevails in whole
in such action, shall be entitled to recover from the Company and the
Subsidiary, and shall be jointly and severally indemnified by the Company
and the Subsidiary against, any Expenses incurred by Indemnitee. If it is
determined that Indemnitee is entitled to indemnification for part (but not
all) of the indemnification so requested, Expenses incurred in seeking
enforcement of such partial indemnification shall be reasonably prorated
among the claims, issues or matters for which Indemnitee is entitled to
indemnification and for claims, issues or matters for which Indemnitee is
not so entitled.
12. Non-Exclusivity. The rights of indemnification and to receive
advances as provided by this Agreement shall not be deemed exclusive of any
other rights to which Indemnitee may at any time be entitled under any law,
certificate of incorporation, by-law, other agreement, vote of stockholders
or resolution of directors or otherwise, both as to action in Indemnitee's
official capacity and as to action in another capacity while holding such
office. To the extent Indemnitee would be prejudiced thereby, no amendment,
alteration, rescission or replacement of this Agreement or any provision
hereof shall be effective as to Indemnitee with respect to any action taken
or omitted by such Indemnitee in Indemnitee's position with the Company or
an Affiliate or any other entity which Indemnitee is or was serving at the
request of the Company or the Subsidiary prior to such amendment,
alteration, rescission or replacement.
13. Duration of Agreement. This Agreement shall apply to any
claim asserted and any Losses and Expenses incurred in connection with any
claim asserted on or after the effective date of this Agreement and shall
continue until and terminate upon the later of: (a) ten years after
Indemnitee has ceased to occupy any of the positions or have any of the
relationships described in Section 3, 4 or 5 hereof; or (b) one year after
the final termination of all pending or threatened Proceedings of the kind
described herein with respect to Indemnitee. This Agreement shall be
binding upon the Company and the Subsidiary and their respective successors
and assigns and shall inure to the benefit of Indemnitee and Indemnitee's
spouse, assigns, heirs, devisee, executors, administrators or other legal
representatives.
14. Maintenance of D&O Insurance.
(a) The Company and the Subsidiary each hereby covenants and
agrees with Indemnitee that, so long as Indemnitee shall continue to serve
as an Officer or Director of the Company and thereafter so long as
Indemnitee shall be subject to any possible claim or threatened, pending or
completed Proceeding, whether civil, criminal or investigative, by reason
of the fact that Indemnitee was an Officer or Director of the Company or
any other entity which Indemnitee was serving at the request of the Company
or the Subsidiary, the Company and the Subsidiary shall maintain in full
force and effect (i) the directors' and officers' liability insurance
issued by the insurer and having the policy amount and deductible as
currently in effect with respect to directors and officers of the Company
or any of its subsidiaries and (ii) any replacement or substitute policies
issued by one or more reputable insurers providing in all respects coverage
at least comparable to and in the same amount as that currently provided
under such existing policy (collectively, "D&O Insurance").
(b) In all policies of D&O Insurance, Indemnitee shall be
named as an insured in such a manner as to provide Indemnitee the same
rights and benefits, subject to the same limitations, as are accorded to
the Company's directors or officers most favorably insured by such policy.
(c) Notwithstanding anything to the contrary set forth in
(a) above, the Company and the Subsidiary shall have no obligation to
maintain D&O Insurance if the Company and the Subsidiary determine in good
faith that such insurance is not reasonably available, the premium cost for
such insurance is disproportionate to the amount of coverage provided or
the coverage provided by such insurance is limited by exclusions so as to
provide an insufficient benefit.
15. Severability. Should any part, term or condition hereof be
declared illegal or unenforceable or in conflict with any other law, the
validity of the remaining portions or provisions hereof shall not be
affected thereby, and the illegal or unenforceable portions hereof shall be
and hereby are redrafted to conform with applicable law, while leaving the
remaining portions hereof intact.
16. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same document.
17. Headings. Section headings are for convenience only and do
not control or affect meaning or interpretation of any terms or provisions
hereof.
18. Modification and Waiver. No supplement, modification or
amendment of this Agreement shall be binding unless executed in writing by
each of the parties hereto.
19. No Duplicative Payment. The Company and the Subsidiary shall
not be liable under this Agreement to make any payment of amounts otherwise
indemnifiable hereunder if and to the extent that Indemnitee has otherwise
actually received such payment (net of Expenses incurred in collecting such
payment) under any insurance policy, contract, agreement or otherwise.
20. Notices. All notices, requests, demands and other
communications provided for by this Agreement shall be in writing
(including telecopier or similar writing) and shall be deemed to have been
given at the time when mailed, enclosed in a registered or certified
postpaid envelope, in any general or branch office of the United States
Postal Service, or sent by Federal Express or other similar overnight
courier service, addressed to the address of the parties stated below or to
such changed address as such party may have fixed by notice or, if given by
telecopier, when such telecopy is transmitted and the appropriate
answerback is received.
(a) If to Indemnitee, to the address appearing on the
signature page hereof.
(b) If to the Company or the Subsidiary to:
Citadel Broadcasting Corporation
City Center West, Suite 400
0000 Xxxx Xxxx Xxxx Xxxx.
Xxx Xxxxx, Xxxxxx 00000
Attention: Secretary
21. Governing Law. The parties agree that this Agreement shall be
governed by, and construed and enforced in accordance with, the internal
laws of the State of Delaware without regard to its conflicts of law rules.
22. Entire Agreement. Subject to the provisions of Section 12
hereof, this Agreement constitutes the entire understanding between the
parties and supersedes all proposals, commitments, writings, negotiations
and understandings, oral and written, and all other communications between
the parties relating to the subject matter hereof. This Agreement may not
be amended or otherwise modified except in writing duly executed by all of
the parties. A waiver by any party of any breach or violation of this
Agreement shall not be deemed or construed as a waiver of any subsequent
breach or violation thereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
CITADEL BROADCASTING CORPORATION
CITADEL BROADCASTING COMPANY
By: /s/ Xxxxx Xxxxxxx
-------------------------------------
Xxxxx Xxxxxxx
Chief Executive Officer, of each of
the above listed entities
INDEMNITEE
Name: /s/ Xxxx Xxxxx
-----------------------------------
Xxxx Xxxxx
[Address]
