STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT (the "AGREEMENT") is entered into and
effective as of February 14, 1997 by and among Heftel Broadcasting
Corporation, a Delaware corporation (the "COMPANY"), and each of the
stockholders listed on the signature pages hereto, and each other holder of
record of Common Stock (as defined below), who may hereafter execute a
separate agreement to be bound by the terms hereof. The stockholders listed
on the signature pages hereto, other than Prime II Management, L.P.,
PrimeComm, L.P. and Alta Subordinated Debt Partners III, L.P. (each of which
are parties to this Agreement for the limited purposes of agreeing to the
restrictions on transfer set forth in Section 2.2), and each other Person (as
defined below) that may become a party hereto as contemplated hereby, being
hereinafter referred to individually as a "STOCKHOLDER" and collectively as
the "STOCKHOLDERS."
RECITALS:
A. Clear Channel Communications, Inc., a Texas corporation ("CCC"),
and Xxxxxxxx Media System, Inc., a Texas corporation ("TMS"), have entered
into that certain Agreement and Plan of Merger (the "MERGER AGREEMENT") dated
as of July 9, 1996, as amended, which has been assigned to the Company and
pursuant to which a subsidiary of the Company merged with and into TMS (the
"MERGER").
B. In the Merger all of the outstanding capital stock of TMS, other
than the Senior Preferred (as defined in the Merger Agreement) and other than
capital stock of TMS held by CCC, was converted into shares of Class A Common
Stock, par value $.001 per share (the "CLASS A COMMON STOCK"), of the
Company.
C. In the Merger all of the shares of capital stock of TMS and all of
the shares of Class A Common Stock held by CCC and Clear Channel Radio, Inc.,
a Nevada corporation ("CCR") were converted into shares of Class B Common
Stock, par value $.001 (the "CLASS B COMMON STOCK") of the Company.
D. The Company and the Stockholders desire to restrict the sale,
assignment, transfer, encumbrance or other disposition of the Common Stock of
the Company which may be now owned or hereafter acquired by the Stockholders,
and to provide for certain rights and obligations in respect thereof and
certain other matters as hereinafter provided.
NOW, THEREFORE, in consideration of the mutual covenants and obligations
hereinafter set forth, the parties hereto, intending to be legally bound,
hereby agree as follows:
ARTICLE I
GENERAL PROVISIONS;
REPRESENTATIONS AND WARRANTIES
1.1 CERTAIN TERMS. In addition to the terms defined elsewhere herein,
when used herein the following terms shall have the meanings indicated:
"ACCREDITED INVESTOR" shall have the meaning set forth for such term
in Regulation D.
An "AFFILIATE" means, with respect to any Person, any other Person
controlling, controlled by or under common control with the first Person.
For purposes of this definition and this Agreement, the term "control" (and
correlative terms) means the power, whether by contract, equity ownership
or otherwise, to direct the policies or management of a Person.
With respect to any stock,"BENEFICIAL" ownership or "BENEFICIALLY"
owned shall have the same meaning as in Rule 13d-3 under the Exchange Act,
or any successor provision.
"BOARD" means the board of directors of the Company.
"CLEAR CHANNEL REGISTRATION RIGHTS AGREEMENT" means that certain
Registration Rights Agreement of even date herewith by and among the
Company and the Clear Channel Stockholders, as amended from time to time.
"CLEAR CHANNEL STOCKHOLDERS" means CCC and CCR and the transferees of
such Stockholders (other than a Xxxxxxxx Stockholder) authorized under this
Agreement, excluding, however, a transferee in an Exempt Transfer or a
Third-Party Sale.
"COMMON STOCK" means, collectively, the Class A Common Stock, the
Class B Common Stock and any securities that the Class A Common Stock or
the Class B Common Stock may be converted into or exchanged for, including
pursuant to any Permitted Transfer in connection with a merger,
consolidation, share exchange or other similar transaction.
"COMMON STOCK EQUIVALENTS" means (without duplication with any other
Class A Common Stock, Class B Common Stock or Common Stock Equivalents)
rights, warrants, options, convertible securities, or exchangeable
securities or indebtedness, or other rights, exercisable for or convertible
or exchangeable into, directly or indirectly, Class A Common Stock or
securities convertible or exchangeable into Class A Common Stock, whether
at the time of issuance or upon the passage of tine or the occurrence of
some future event.
"CONVERSION DATE" means the date on which the Clear Channel
Stockholders collectively beneficially own a greater number of shares of
Class A Common Stock than the number of shares of Class A Common Stock
collectively beneficially owned by the Xxxxxxxx Stockholders.
"COVERED SHARES" means shares of Class A Common Stock and Class B
Common Stock held by Stockholders that are subject to the provisions of
Article II as provided in Section 4.4.
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"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations thereunder, and any successor statute.
"EXEMPT TRANSFER" means (a) one or more Transfers by a Stockholder,
whether or not related, within a 12-month period which in the aggregate do
not exceed five percent of the number of shares of Common Stock owned by
such Stockholder on the date hereof (as set forth on the signature pages
hereto, and as adjusted for any splits, stock dividends payable in Common
Stock or securities exercisable or exchangeable for Common Stock, or
reverse stock splits), (b) sales of Common Stock by a Stockholder in an
offering registered under the Securities Act pursuant to such Stockholder's
rights under the Xxxxxxxx Registration Rights Agreement or the Clear
Channel Registration Rights Agreement, (c) a Transfer to the equity
interest owners of a Clear Channel Stockholder in a pro rata distribution
or upon a partial or complete liquidation or dissolution of such Clear
Channel Stockholder (other than from a wholly-owned subsidiary to its sole
stockholder), (d) a Transfer by a Stockholder pursuant to the exercise of
such Stockholder's rights to Transfer in a Participation Offer (as defined
herein) pursuant to Section 2.4 or (e) a Transfer in response to a tender
or exchange offer for all of the outstanding Common Stock of the Company.
"FULLY-DILUTED COMMON STOCK" means, at any time, the then outstanding
Common Stock of the Company plus (without duplication) all shares of Common
Stock issuable, whether at such time or upon the passage of time or the
occurrence of future events, upon the exercise, conversion or exchange of
all then outstanding Common Stock Equivalents. For purposes of this
definition, each share of Class B Common Stock shall be deemed exchanged
for one share of Class A Common Stock notwithstanding any restriction or
prohibition relating to such exchange.
"IMMEDIATE FAMILY" means the spouse of an individual and the
grandparents, parents, siblings and children (and children and spouses of
any of the foregoing) of the individual or his or her spouse. An adopted
child will be treated as the child of his or her adoptive parent or parents
if (but only if) he or she was adopted before he or she reached 21 years of
age.
"MARKET PRICE" means the average closing sale price of the Class A
Common Stock for the five trading days prior to the date in question on the
principal securities exchange on which the Class A Common Stock is then
traded.
"PERSON" means any natural person, corporation, limited partnership,
general partnership, joint stock company, joint venture, association,
company, trust, bank, trust company, land trust, business trust or other
organization, whether or not a legal entity, and any government or agency
or political subdivision thereof.
"PERMITTED TRANSFER" means any Transfer (a) with respect to a
Stockholder who is an individual, to a member of the Immediate Family of
the Stockholder or a trust whose sole
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beneficiaries are the Stockholder and/or members of the Immediate
Family of the Stockholder, (b) with respect to a Stockholder that is a
corporation, partnership or other entity (other than a trust), to an
equity owner of the corporation, partnership or other legal entity,
(c) with respect to a Stockholder that is a trust, to any beneficiary
of the trust or any member of the Immediate Family of a beneficiary of
the trust, (d) to any wholly-owned Affiliate of a Stockholder, (e)
pursuant to a pledge to secure indebtedness provided that the pledgee
agrees in writing that the shares of Common Stock subject to such
Transfer shall be subject to the terms hereof, (f) to any charitable
trust, foundation or other organization or entity, (g) to a
Stockholder pursuant to the provisions of Section 2.3 and (h) pursuant
to a merger, consolidation, share exchange or other similar
transaction in which the holders of a majority of the outstanding
shares of Common Stock continue to own a majority of the common equity
interests of the surviving entity.
"REGULATION D" means Regulation D as promulgated under the Securities
Act, as amended from time to time, and any successor provision.
"SEC" means the Securities and Exchange Commission or any successor
governmental agency.
"SECURITIES ACT" means the Securities Act of 1933 and the rules and
regulations thereunder, as amended from time to time, and any successor
statute.
"THIRD-PARTY SALE" means any Transfer other than an Exempt Transfer or
a Permitted Transfer.
"XXXXXXXX REGISTRATION RIGHTS AGREEMENT" means that certain
Registration Rights Agreement of even date herewith by and among the
Company and the Xxxxxxxx Stockholders, as amended from time to time.
"XXXXXXXX STOCKHOLDERS" means the Stockholders, other than the Clear
Channel Stockholders, listed on the signature pages of this Agreement and
the transferees of such Stockholders (other than a Clear Channel
Stockholder) authorized under this Agreement, excluding, however, a
transferee in an Exempt Transfer or a Third-Party Sale.
"TRANSFER" means any direct or indirect sale, transfer, pledge or
other disposition of Covered Shares.
1.2 REPRESENTATIONS AND WARRANTIES.
(a) Each of the Stockholders (as to itself only) represents and
warrants to the Company and the other Stockholders that;
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(i) it has full power and authority to execute, deliver and
perform this Agreement and to consummate the transactions contemplated
hereby, and the execution, delivery and performance by it of this Agreement
and the consummation by it of the transactions contemplated hereby have
been duly authorized by all necessary action;
(ii) this Agreement has been duly and validly executed and
delivered by such Stockholder and constitutes the binding obligation of
such Stockholder enforceable against such Stockholder in accordance with
its terms; and
(iii) the execution, delivery and performance by such
Stockholder of this Agreement and the consummation by such Stockholder of
the transactions contemplated hereby will not, with or without the giving
of notice or the lapse of time, or both, (A) violate any provision of law,
statute, rule or regulation to which it is subject, (B) violate any order,
judgment or decree applicable to it, or (C) conflict with, or result in a
breach or default under, any term or condition of its certificate of
incorporation or by-laws, certificate of limited partnership or partnership
agreement, as applicable, or any agreement or other instrument to which
such Stockholder is a party or by which such Stockholder is bound.
(b) The Company hereby represents and warrants to each Stockholder
that:
(i) it is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Delaware, it has full
corporate power and authority under its certificate of incorporation to
execute, deliver and perform this Agreement and to consummate the
transactions contemplated hereby, and the execution, delivery and
performance by it of this Agreement and the consummation of the transaction
contemplated hereby have been duly authorized by any necessary action;
(ii) this Agreement has been duly and validly executed and
delivered by the Company and constitutes the binding obligation thereof
enforceable against the Company in accordance with its terms; and
(iii) the execution, delivery and performance by the Company
of this Agreement will not, with or without the giving of notice or the
lapse of time, or both, (A) violate any provision of law, statute, rule or
regulation to which the Company is subject, (B) violate any order, judgment
or decree applicable to the Company, or (C) conflict with, or result in a
breach or default under, any term or condition of its Certificate of
Incorporation or by-laws or any agreement or other instrument to which the
Company is a party or by which it is bound other than such violations,
conflicts, breaches and defaults which individually or in the aggregate
would not (x) affect the Company's ability to perform its obligations
hereunder or (y) have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
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ARTICLE II
TRANSFERS OF SECURITIES
2.1 GENERAL. Any Third-Party Sale shall be subject to compliance with
provisions of this Article II. For purposes of this Agreement, as to any
Stockholder which is a legal entity and does not have assets valued, on a cost
basis, equal to or in excess of the greater of (a) $5 million or (b) the value
of Common Stock held thereby (valued at the Market Price), in each case other
than Common Stock, any Transfer of any equity interest in such Stockholder
which, in one or a series of Transfers, involves in the aggregate more than a
50% equity interest in such Stockholder will be a Transfer unless such Transfer
is solely to other existing equity holders of such entity. Any Permitted
Transfer will require the execution and delivery of an instrument in form and
substance satisfactory to the Board pursuant to which the Transferee agrees to
be bound by this Agreement.
2.2 TRANSFER RESTRICTIONS. Each Xxxxxxxx Stockholder, other than XxXxxxx
X. Xxxxxxxx, Xx., agrees with the Company not to Transfer (other than pursuant
to Permitted Transfers or pursuant to the exercise of rights granted under the
Xxxxxxxx Registration Rights Agreement) any Covered Shares for a period of 180
days after the date hereof. XxXxxxx X. Xxxxxxxx, Xx. agrees with the Company
not to Transfer any Covered Shares (other than (a) pursuant to Permitted
Transfers, (b) with respect to Covered Shares having a Market Price not to
exceed $3 million, pursuant to the exercise of rights granted under the Xxxxxxxx
Registration Rights Agreement, (c) pursuant to the exercise of his rights to
Transfer in a Participation Offer under Section 2.4, or (d) pursuant to a
Transfer in response to a tender or exchange offer for all of the outstanding
Common Stock of the Company) until the second anniversary of the date hereof.
Prime II Management, L.P., PrimeComm, L.P. and Alta Subordinated Debt Partners
III, L.P. each agrees with the Company not to Transfer any Covered Shares (other
than (a) pursuant to transactions that would be Permitted Transfers if such
parties were Stockholders, (b) pursuant to the exercise of rights granted under
the Xxxxxxxx Registration Rights Agreement, or (c) pursuant to a Transfer in
response to a tender or exchange offer for all of the outstanding Common Stock
of the Company, and with respect to Prime II Management, L.P. and PrimeComm,
L.P., other than pursuant to Transfers of up to 65,000 shares of Common Stock in
the aggregate) until the earlier to occur of June 30, 1997 or the 180th day
after the date hereof. Each Clear Channel Stockholder agrees with the Company
not to Transfer any Covered Shares (other than (a) pursuant to Permitted
Transfers, (b) pursuant to the exercise of rights granted under the Clear
Channel Registration Rights Agreement, (c) pursuant to a Transfer to the equity
interest owners of a Clear Channel Stockholder whether in a pro rata
distribution or upon a partial or complete liquidation or dissolution of such
Clear Channel Stockholder or otherwise or (d) pursuant to a Transfer in response
to a tender or exchange offer for all of the outstanding Common Stock of the
Company for a period of 180 days after the date hereof.
2.3 RIGHT OF FIRST OFFER. (a) Prior to consummating any Third-Party Sale,
the Stockholder proposing to effect the Third-Party Sale (the "OFFERING
STOCKHOLDER") will deliver to each of the other Stockholders a written notice
(an "OFFER NOTICE") specifying (i) the aggregate amount of cash consideration
(the "OFFER PRICE") for which the Offering Stockholder proposes in good faith to
sell
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the Shares to be offered in such Third-Party Sale (the "OFFERED SHARES"),
(ii) the identity of the purchaser in such Third-Party Sale (if then known), and
(iii) all other material terms of the proposed Third-Party Sale. For purposes
of this Section 2.3, the Xxxxxxxx Stockholders only (collectively and as they
may allocate among themselves as set forth below) will be the "NON-OFFERING
STOCKHOLDER" with respect to a proposed Third-Party Sale by any Clear Channel
Stockholder, and the Clear Channel Stockholders only (collectively and as they
may allocate among themselves as set forth below) will be the Non-Offering
Stockholder with respect to a proposed Third-Party Sale by any Xxxxxxxx
Stockholder.
(b) RIGHTS TO PURCHASE OFFERED SHARES. If the Non-Offering
Stockholder delivers to the Offering Stockholder a written notice (an
"ACCEPTANCE NOTICE") within 30 days following delivery of the Offer Notice
(PROVIDED that if such offer relates to a proposed Transfer of Common Stock
representing more than 10% of the Common Stock owned by such Offering
Stockholder on the date hereof and more than two percent of the then outstanding
Common Stock such Non-Offering Stockholder shall have 60 days in which to
deliver such Acceptance Notice (either such period being referred to herein as
the "ROFO ACCEPTANCE PERIOD")), stating that such Non-Offering Stockholder is
willing to purchase all of the Offered Shares for the Offer Price and on the
other terms set forth in the Offer Notice, the Offering Stockholder will sell
all (but not less than all) of the Offered Shares to such Non-Offering
Stockholder, and such Non-Offering Stockholder will purchase such Offered Shares
from the Offering Stockholder, on the proposed terms and subject to the
conditions set forth below. In such case, the Xxxxxxxx Stockholders only, with
the Offered Shares allocated (unless otherwise agreed by the Xxxxxxxx
Stockholders requesting to purchase Offered Shares) based on the number of
Offered Shares requested to be purchased by each of the Xxxxxxxx Stockholders,
will be the "PURCHASING STOCKHOLDER" with respect to a proposed Third-Party Sale
by any Clear Channel Stockholder, and the Clear Channel Stockholders only, with
the Offered Shares allocated (unless otherwise agreed by the Clear Channel
Stockholders requesting to purchase Offered Shares) based on the number of
Shares owned by each of the Clear Channel Stockholders who request to purchase
Offered Shares (but in no event so as to require any Stockholder to purchase in
excess of the number of Offered Shares requested by such Stockholder), will be
the Purchasing Stockholder with respect to a proposed Third-Party Sale by any
Xxxxxxxx Stockholder.
(c) THE ROFO CLOSING. The consummation of any purchase of the
Offered Shares by the Purchasing Stockholder pursuant to this Section 2.3 (the
"ROFO CLOSING") will occur no more than five Business Days following the
delivery of the Acceptance Notice (such five Business Day period being referred
to herein as the "ROFO CLOSING PERIOD") at such time and place as may be agreed
upon by the Offering Stockholder and the Purchasing Stockholder or, if such
parties fail to agree to such time and place, at the principal executive offices
of the Company at 10:00 a.m. (Central Time) on the fifth Business Day following
the expiration of the ROFO Acceptance Period. At the ROFO Closing, (i) the
Purchasing Stockholder will deliver to the Offering Stockholder by certified or
official bank check or wire transfer to an account designated by the Offering
Stockholder an amount in immediately available funds equal to the Offer Price,
(ii) the Offering Stockholder will deliver one or more certificates evidencing
the Offered Shares, together with such other duly executed instruments or
documents (executed by the Offering
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Stockholder) as may be reasonably requested by the Purchasing Stockholder to
acquire the Offered Shares free and clear of any and all claims, liens,
pledges, charges, encumbrances, security interests, options, trusts,
commitments and other restrictions of any kind whatsoever (collectively,
"ENCUMBRANCES"), except for Encumbrances created by this Agreement, federal
or state securities law or the Purchasing Stockholder or as specified in the
Offer Notice, and (iii) the Offering Stockholder will be deemed to represent
and warrant to the Purchasing Stockholder that, upon the ROFO Closing, the
Offering Stockholder will convey and the Purchasing Stockholder will acquire
the entire record and beneficial ownership of, and good and valid title to,
the Offered Shares, free and clear of any and all Encumbrances, except for
Encumbrances created by this Agreement, federal and state securities laws or
the Purchasing Stockholder or as described in the Offer Notice.
(d) RIGHT TO CONSUMMATE THIRD-PARTY SALE. Subject to the provisions
of Section 2.4 below, if no Acceptance Notice relating to the proposed Third-
Party Sale is delivered to the Offering Stockholder prior to the expiration of
the ROFO Acceptance Period, or an Acceptance Notice is so delivered to the
Offering Stockholder but the ROFO Closing fails to occur prior to the expiration
of the ROFO Closing Period (unless the Purchasing Stockholder was ready, willing
and able prior to the expiration of the ROFO Closing Period to consummate the
transactions to be consummated by the Purchasing Stockholder at the ROFO
Closing), the Offering Stockholder may (without affecting its rights, if any,
arising out of such failure) consummate the Third-Party Sale, but only
(i) during the 180 calendar day period immediately following the expiration of
the ROFO Acceptance Period (in the event that no Acceptance Notice was timely
delivered to the Offering Stockholder) or the 180 calendar day period
immediately following the expiration of the ROFO Closing Period (in the event
that an Acceptance Notice was timely delivered to the Offering Stockholder but
the ROFO Closing failed timely to occur), (ii) at a price at least equal to 95%
of the Offer Price, and (iii) upon other terms not materially less favorable to
the Offering Stockholder than those set forth in the Offer Notice.
2.4 PARTICIPATION OFFER. Prior to consummating any Third-Party Sale
and after complying with the provisions of Section 2.3 above, the Stockholder
proposing to complete such Third-Party Sale (the "TRANSFEROR") shall offer (the
"PARTICIPATION OFFER") to include in the proposed Third-Party Sale a number of
shares of Stock (regardless of whether such shares are of the same class being
sold by the Transferor) designated by any of the other Stockholders, not to
exceed, in respect of any such other Stockholder, the number of shares equal to
the product of (a) the aggregate number of shares to be sold by the Transferor
to the proposed transferee and (b) a fraction with a numerator equal to the
number of shares of Fully-Diluted Common Stock held by such other Stockholder
and a denominator equal to the number of shares of Fully-Diluted Common Stock
held by all Stockholders; PROVIDED that if the consideration to be received by
the Transferor includes any securities, only Stockholders who are Accredited
Investors shall be entitled to include their shares in such sale (but in such a
case, each Stockholder shall be entitled to include in such sale a number of its
shares, without duplication, equal to the total number of shares held by its
Affiliates which are excluded from such sale by the operation of this proviso).
The Transferor shall give written notice to each other non-transferring
Stockholder of the Participation Offer (the "TRANSFEROR'S NOTICE") at least 20
days prior to the proposed Third-Party Sale. The Transferor's Notice shall
specify (a) the
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Offer Price for which the Transferor proposes in good faith to sell the
shares to be offered in such Third-Party Sale (the "SALE SHARES"), (b) the
identity of the purchaser in such Third-Party Sale (if then known), (c) the
place and date on which the Third -Party Sale is to be consummated and (d)
all other material terms of the proposed Third-Party Sale. Each Stockholder
who wishes to include shares of Common Stock in the proposed Third-Party Sale
in accordance with the terms of this Section 2.4 shall so notify the
Transferor not more than 10 days after the date of the Transferor's Notice.
The Participation Offer shall be conditioned upon the Transferor's sale of
Common Stock pursuant to the transactions contemplated in the Transferor's
Notice with the transferee named therein. If any other Stockholder or other
Stockholders have accepted the Participation Offer, the Transferor shall
reduce to the extent necessary the number of shares of Common Stock it
otherwise would have sold in the proposed sale so as to permit other
Stockholders who have accepted the Participation Offer to sell the number of
shares that they are entitled to sell under this Section 2.4, and the
Transferor and such other Stockholder or other Stockholders shall sell the
number of shares of Common Stock specified in the Participation Offer to the
proposed transferee in accordance with the terms of such sale set forth in
the Transferor's Notice.
2.5 CONVERSION OF CLASS B COMMON STOCK. Neither a conversion of shares of
Class B Common Stock held by the Clear Channel Stockholders into Class A Common
Stock, nor a conversion of Class A Common Stock held by the Clear Channel
Stockholders into Class B Common Stock shall be deemed a Transfer if the shares
of Class A Common Stock or Class B Common Stock, as the case may be, issuable
upon such conversion are held by a Clear Channel Stockholder. After the
Conversion Date the obligations of each of the Stockholders to make a
Participation Offer pursuant to Section 2.4 shall terminate and be of no further
force or effect. In addition, after the Conversion Date the ROFO Acceptance
Period with respect to any Third-Party Sales shall be reduced to ten days
regardless of the number of shares of Common Stock that are the subject of the
Offer Notice.
2.6 TRANSFERS SUBJECT TO COMPLIANCE WITH SECURITIES ACT. No shares of
Common Stock may be transferred by a Stockholder (other than pursuant to an
effective registration statement under the Securities Act) unless such
Stockholder first delivers to the Company an opinion of counsel, which opinion
and counsel shall be reasonably satisfactory to the Company, to the effect that
such transfer in not required to be registered under the Securities Act.
2.7 TRANSFERS IN VIOLATION VOID. Any purported Transfer by a Stockholder
which is not permitted by the provisions of this Article II, or which is in
violation of such provisions, shall be void and of no force and effect
whatsoever.
ARTICLE III
TERMINATION
The provisions of this Agreement shall terminate in respect of all
Stockholders (a) upon the written consent of (i) Stockholders who then hold
Common Stock representing at least seventy-five
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percent of the Fully-Diluted Common Stock then held by all of the
Stockholders (other than CCC or its Affiliates, if CCC or one of its
Affiliates then holds 25% or more of the outstanding Common Stock) and (ii)
CCC, if CCC or any of its Affiliates then holds 25% or more of the
outstanding Common Stock, and (b) immediately prior to the consummation of a
merger, consolidation, share exchange or other similar transaction in which
the holders of a majority of the outstanding Common Stock of the Company
shall cease to hold a majority of the common equity interests in the
surviving entity. A Person who ceases to hold any Stock and who ceases to
beneficially own any Stock shall cease to be a Stockholder and shall have no
further rights under this Agreement.
ARTICLE IV
MISCELLANEOUS
4.1 AMENDMENT. Any provision of this Agreement may be altered,
supplemented, amended or waived by the written consent of each of (a) the
Company, (b) the holders of a majority of the Covered Shares then held by the
Clear Channel Stockholders and (c) the holders of a majority of the Covered
Shares then held by the Xxxxxxxx Stockholders, and such alteration, supplement,
amendment or waiver shall be binding upon all Stockholders including
nonconsenting Stockholders.
4.2 SPECIFIC PERFORMANCE. The Stockholders and the Company recognize that
the obligations imposed an them in this Agreement are special, unique, and of
extraordinary character, and that in the event of breach by any party, damages
will be an insufficient remedy; consequently, it is agreed that the Stockholders
and the Company may have specific performance and injunctive relief (in addition
to damages) as a remedy for the enforcement hereof, without proving damages.
4.3 ASSIGNMENT. Except as otherwise expressly provided herein, the terms
and conditions of this Agreement shall inure to the benefit of and be binding
upon the respective successors and assigns of the Stockholders and the Company.
No such assignment shall relieve the assignor from any liability hereunder. Any
purported assignment made in violation of this Section 4.3 shall be void and of
no force and effect.
4.4 SHARES SUBJECT TO THIS AGREEMENT. The provisions of Article II of
this Agreement restricting the Transfer of shares of Common Stock will apply to
all shares of Common Stock owned by the Stockholders on the date hereof and any
shares of Common Stock acquired after the date hereof until they are Transferred
in an Exempt Sale or Third-Party Sale to a person other than a Stockholder.
4.5 LEGENDS. (a) Each certificate for Common Stock shall include a legend
in substantially the following form:
THIS SECURITY IS SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER, AND
OTHER TERMS AND CONDITIONS SET FORTH IN THE STOCKHOLDERS AGREEMENT,
DATED AS OF FEBRUARY 14, 1997 A
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COPY OF WHICH MAY BE OBTAINED FROM THE COMPANY AT ITS PRINCIPAL
EXECUTIVE OFFICES.
(b) A restriction on transfer of shares of Common Stock set forth in
such legends (a "RESTRICTION") shall cease and terminate as to any particular
shares of Common Stock when, in the opinion of the Company and counsel
reasonably satisfactory to the corporation (which opinion shall be delivered
to the Company in writing), such Restriction is no longer required under the
provisions hereof. Whenever such Restriction shall cease and terminate as to
any shares of Common Stock, the holder thereof shall be entitled to receive
from the Company, without expense to such holder, new certificates) not
bearing a legend stating such Restriction.
4.6 NOTICES. Any and all notices, designations, consents, offers,
acceptances or other communications provided for herein (each "NOTICE") shall be
given in writing by overnight courier, telegram, or telecopy which shall be
addressed, or sent, to the respective addresses as follows (or such other
address as the Company or any Stockholder may specify to the Company and all
other Stockholders by Notice):
The Company:
Heftel Broadcasting Corporation
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Each Stockholder:
To such address or telecopy number of such Stockholder as is set forth
on the signature pages hereto or as such Stockholder provides by
notice to the Company and all other Stockholders or, if such address
is not so provided, to such Stockholder's address as is reflected on
the stock transfer records of the Company at such time.
All Notices shall be deemed effective upon receipt. No Stockholder shall be
entitled to receive a Notice hereunder (or a copy of a Notice delivered to the
Company) if, at the time such Notice is to be sent, such Stockholder (including
its Affiliates and the employees of such Stockholder and its Affiliates) no
longer owns any shares of Common Stock.
4.7 COUNTERPARTS. This Agreement may be executed in two or more
counterparts and each counterpart shall be deemed to be an original and which
counterparts together shall constitute one and the same agreement of the parties
hereto.
4.8 SECTION HEADINGS. Headings contained in this Agreement are inserted
only as a matter of convenience and in no way define, limit or extend the scope
or intent of this Agreement or any provisions hereof.
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4.9 CHOICE OF LAW. This Agreement shall be governed by the internal laws
of the State of Texas without regard to the principles of conflicts of laws
thereof.
4.10 ENTIRE AGREEMENT. This Agreement contains the entire understanding of
the parties hereto respecting the subject matter hereof and supersedes all prior
agreements, discussions and understandings with respect thereto.
4.11 CUMULATIVE RIGHTS. The rights of the Stockholders and the Company
under this Agreement are cumulative and in addition to all similar and other
rights of the parties under other agreements.
4.12 SEVERABILITY. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired, or invalidated.
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IN WITNESS WHEREOF the parties have caused this Agreement to be executed by
their duly authorized representatives, effective as of the date first written
above.
HEFTEL BROADCASTING CORPORATION
By: /s/ X. Xxxxx Xxxx
-----------------------------------
X. Xxxxx Xxxx
President and Chief Executive Officer
130,414 shares of Class B Common CLEAR CHANNEL COMMUNICATIONS, INC.
Stock
By: /s/ X. Xxxxx Xxxx
-----------------------------------
X. Xxxxx Xxxx
President and Chief Executive Officer
6,947,821 shares of Class B Common CLEAR CHANNEL RADIO, INC.
Stock
By: /s/ X. Xxxxx Xxxx
-----------------------------------
X. Xxxxx Xxxx
President and Chief Executive Officer
112,324 shares of Class A Common /s/ XxXxxxx X. Xxxxxxxx, Xx.
Stock -----------------------------------
XxXxxxx X. Xxxxxxxx, Xx.
959,399 shares of Class A Common /s/ XxXxxxx X. Xxxxxxxx, Xx.
Stock -----------------------------------
XxXxxxx X. Xxxxxxxx, Xx.
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404,510 shares of Class A Common /s/ XxXxxxx X. Xxxxxxxx, Xx.
Stock -----------------------------------
XxXxxxx X. Xxxxxxxx, Xx., as
Custodian for Xxxxx X. Xxxxxxxx
1,090,157 shares of Class A Common /s/ Xxxxxx X.. Xxxxxxxx
Stock -----------------------------------
Xxxxxx X.. Xxxxxxxx
864,636 shares of Class A Common /s/ Xxxxxxx X. Xxxxxxxx
Stock -----------------------------------
Xxxxxxx X.. Xxxxxxxx
914,056 shares of Class A Common /s/ Xxxx X. Xxxxxxx
Stock -----------------------------------
Xxxx X. Xxxxxxx
65,118 shares of Class A Common /s/ Xxxxxxx X. del Xxxxxxxx
Stock -----------------------------------
Xxxxxxx X. del Xxxxxxxx
101,109 shares of Class A Common /s/ Xxxxxxx Xxxxxx
Stock -----------------------------------
Xxxxxxx Xxxxxx
242,494 shares of Class A Common /s/ Xxxxx Xxxxx
Stock -----------------------------------
Xxxxx Xxxxx
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PRIME II MANAGEMENT, L.P.
215,590 shares of Class A Common
Stock By: Prime II Management, Inc.,
its general partner
By: /s/ Signature Illegible
-----------------------------
Its: President
-----------------------------
PRIME COMM, L.P.
By: PrimeComm, Inc.,
its general partner
30,798 shares of Class A Common Stock
By: /s/ Xxxx X. Xxxxxxxxx
-----------------------------
Its: Vice President
-----------------------------
ALTA SUBORDINATED DEBT
PARTNERS III, L.P.
By: Alta Subordinated Debt
Management III, L.P.
180,000 shares of Class A Common Stock
By: /s/ Xxxxx X. XxXxxxx,
-----------------------------
General Partner
-----------------------------
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