STOCKHOLDER AGREEMENT
THIS STOCKHOLDER AGREEMENT, dated as of August 24, 1997 (this
"Agreement"), is made and entered into by and among SBI Holding Corporation, a
Delaware corporation ("Parent"), SBI Radio Acquisition Corporation, a Delaware
corporation and a direct wholly-owned subsidiary of Parent ("Sub"), Xxxxxx F.
X. Sillerman (the "Stockholder") and solely for purposes of Sections 4(c), 5
and 9(b) of this Agreement, SFX Broadcasting, Inc., a Delaware corporation (the
"Company").
W I T N E S S E T H
WHEREAS, concurrently herewith, Parent, Sub and the Company
are entering into an Agreement and Plan of Merger (as such agreement may
hereafter be amended from time to time, the "Merger Agreement"), pursuant to
which Sub will be merged with and into the Company (the "Merger"); capitalized
terms used and not defined herein have the respective meanings ascribed to them
in the Merger Agreement; and
WHEREAS, as an inducement and a condition to entering into
the Merger Agreement, Parent has required that the Stockholder agree, and the
Stockholder has agreed, to enter into this Agreement;
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements contained herein and the
benefits to be received by the parties under the terms of the Merger Agreement,
the parties hereto, intending to be legally bound, hereby agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Acquisition Proposal" shall mean any agreement, letter
of intent, proposal or offer (other than the transactions contemplated in the
Merger Agreement) involving the Company or any of its Subsidiaries for, or an
inquiry or indication of interest that reasonably could be expected to lead to:
(i) any merger, consolidation, share exchange, recapitalization,
reorganization, dissolution, liquidation, business combination, or other
similar transaction with the Company or any of its Subsidiaries, (ii) any sale,
lease, exchange, mortgage, pledge, transfer or other disposition of a material
portion of the assets of the Company and its Subsidiaries, taken as a whole, in
a single transaction or series of transactions, or (iii) any tender offer or
exchange offer for all or any portion of the outstanding shares of capital
stock of the Company or any of its Subsidiaries or the filing of a registration
statement under the Securities Act of 1933 in connection therewith, but shall
not include the Merger Agreement or Second Transaction (as defined herein).
(b) "Affiliate" of any Person means another Person that
directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, such first Person.
(c) "Amendment Proposal" shall mean the proposals to amend
the Company's certificate of incorporation as contemplated in Section 3.01(k)
of the Merger Agreement.
(d) "Beneficially Own" or "Beneficial Ownership" with respect
to any securities shall mean having "beneficial ownership" of such securities
(as determined pursuant to Rule 13d-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act")) including pursuant to any agreement,
arrangement or understanding, whether or not in writing. Without duplicative
counting of the same securities by the same holder, securities Beneficially
Owned by a Person shall include securities Beneficially Owned by all other
Persons (who are Affiliates of such Person excluding officers and directors of
the Company) who together with such Person would constitute a "group" within
the meaning of Section 13(d)(3) of the Exchange Act and in any event with
respect to the Stockholder shall include Shares held of record by any of
Sillerman Communications Management Corporation, The Sillerman Companies and
Sillerman Communications Partners and the Stockholder's spouse and child.
(e) "Person" shall mean an individual, corporation, limited
liability company, partnership, joint venture, association, trust,
unincorporated organization or other entity.
(f) "Shares" shall mean shares of Class A Common Stock, par
value $.01 per share, of the Company, and shares of Class B Common Stock, par
value $.01 per share, of the Company.
(g) "Stockholder's Shares" shall mean all Shares held of
record or Beneficially Owned by the Stockholder, whether currently issued or
hereinafter acquired and for the purposes of Section 3 of this Agreement shall
also include, without duplication, any securities convertible into, or
exercisable or exchangeable for, Shares, including without limitation any
Options, Warrants, Unit Purchase Options or SARs held of record or Beneficially
Owned by the Stockholder.
(h) "Termination Date" shall mean the date that the Merger
Agreement has been terminated.
2. Provisions Concerning Common Stock. From and after the date
of this Agreement and ending as of the first to occur of the Effective Time or
the first anniversary of the Termination Date, at any meeting of the holders of
Common Stock, however called, or in any other circumstance upon which the vote,
consent or other approval of holders of Common Stock is sought, the Stockholder
shall vote (or cause to be voted) the issued and outstanding Stockholder's
Shares (and each class thereof), (i) in favor of the Merger and the Amendment
Proposal, the execution and delivery by the Company of the Merger Agreement and
the approval of the terms thereof and each of the other actions contemplated by
the Merger Agreement and this Agreement and any actions required in furtherance
thereof and hereof; (ii) against any action or agreement that would result in a
breach in any material respect of any covenant, representation or warranty or
any other material obligation or agreement of the Company under the Merger
Agreement or this Agreement; and (iii) against the following actions (other
than the Merger, the Amendment Proposal and the transactions contemplated by
the Merger Agreement): (A) any Acquisition Proposal other than an Acquisition
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Proposal with Parent or any Affiliate thereof and (B) to the extent that such
(1) are intended to, or could reasonably be expected to, impede, interfere
with, delay, postpone, or materially adversely affect the Merger or the
transactions contemplated by the Merger Agreement or this Agreement or (2) are
intended to, or could reasonably be expected to, implement or lead to any
Acquisition Proposal (other than an Acquisition Proposal with Parent or any
Affiliate thereof): (x) any change in a majority of the persons who constitute
the board of directors of the Company; (y) any change in the present
capitalization of the Company or any amendment of the Company's Certificate of
Incorporation (except for the Amendment Proposal) or Bylaws; or (z) any other
material change in the Company's corporate structure or business; provided that
nothing herein shall require the Stockholder to vote the Stockholder's Shares
of Class A Common Stock in the election of directors to be elected by the
holders of Class A Common Stock; and provided, further, that if any Second
Transaction (as defined in Section 3(c)) provides for Second Transaction
Consideration (as defined in Section 3(c)) that is less than the Current
Transaction Consideration (as defined in Section 3(a)), as such amounts shall
be determined in accordance with Section 3, then nothing herein shall require
the Stockholder to vote in favor of the Second Transaction. In addition to the
other covenants and agreements of the Stockholder provided for elsewhere in
this Agreement, during the above-described period the Stockholder shall not
enter into any agreement or understanding with any Person or entity the effect
of which would be inconsistent with or violate the provisions and agreements
contained in this Section 2. Nothing herein shall in any way restrict or limit
the Stockholder from taking any action in his capacity as a director or officer
of the Company or otherwise fulfilling his fiduciary obligations as a director
and officer of the Company.
3. Capture.
(a) In the event that any of the Stockholder's Shares are
sold, transferred, exchanged, canceled or disposed of in connection with or as
a result of any Acquisition Proposal that is in existence on or that has been
otherwise made prior to the first anniversary of the Termination Date (an
"Alternative Disposition") then, within five business days after the closing of
such Alternative Disposition, the Stockholder shall tender and pay to, or shall
cause to be tendered and paid to, the Parent, or its designee, in immediately
available funds, 100% of the Profit realized from such Alternative Disposition.
As used in this Section 3(a), Profit shall mean an amount equal to the excess,
if any, of (i) the Alternative Transaction Consideration over (ii) the Current
Transaction Consideration. As used in this Section 3, Alternative Transaction
Consideration shall mean all cash, securities, settlement or termination
amounts, notes or other debt instruments, and other consideration received or
to be received, directly or indirectly, by the Stockholder and his Affiliates
(excluding officers and directors of the Company) in connection with or as a
result of such Alternative Disposition or any agreements or arrangements
(including, without limitation, any employment agreement (except a bonafide
employment agreement pursuant to which the Stockholder is required to devote,
and under which Stockholder in good faith intends to devote, substantially all
of his business time and effort to the performance of executive services for
the Company in a manner substantially similar to Stockholder's current
employment arrangements with the Company), consulting agreement,
non-competition agreement, confidentiality agreement, settlement agreement or
release agreement) entered into, directly or indirectly, by the Stockholder or
his Affiliates (excluding officers and directors of the Company) as a part of
or in connection with
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the Alternative Disposition or associated Acquisition Proposal. As used in this
Agreement, Current Transaction Consideration shall mean the sum of (x) all
amounts to be received, directly or indirectly, by Stockholder pursuant to
Article II of the Merger Agreement, (y) all amounts to be received by
Stockholder pursuant to the Non-Compete and Termination Agreement (as each of
such are in effect on the date hereof) and (z) any amounts and stock options to
be received by Stockholder pursuant to Section 13.4 of the Amended and Restated
Employment Agreement dated January 1, 1997 between the Company and the
Stockholder, as supplemented by that certain letter agreement dated August 22,
1997.
(b) For purposes of determining Profits under this Section 3
(i) all non-cash items shall be valued based upon the fair market value thereof
as determined by an independent expert selected by Parent and who is reasonably
acceptable to Stockholder, (ii) all deferred payments or consideration shall be
discounted to reflect a market rate of net present value thereof as determined
by the above-referenced independent expert, (iii) all contingent payments will
be assumed to have been paid and (iv) if less than all of the Stockholder's
Shares are subject to the Alternative Disposition or Second Transaction then
the Current Transaction Consideration shall be deemed to be an amount equal to
the Current Transaction Consideration multiplied by a fraction, the numerator
of which is the number of the Stockholder's Shares sold, transferred,
exchanged, canceled or disposed of in such Alternative Disposition or Second
Transaction and the denominator of which is the total number of the
Stockholder's Shares. In addition, in determining Profits, if the associated
Acquisition Proposal or Second Transaction (x) involves a Spin Off (or
securities or assets distributed in an alternative transaction to the Spin Off
having substantially the same economic effect), then the securities distributed
in connection with such Spin Off (or such an alternative transaction to the
Spin Off), shall not be considered in calculating the Alternative Transaction
Consideration or Second Transaction Consideration or (y) does not involve a
Spin Off (or such an alternative transaction to the Spin Off) then in
determining the Current Transaction Consideration the Class A Common Stock
Merger Consideration and the Class B Common Stock Merger Consideration shall
each be deemed to have been increased by an amount equal to $5.00. In the event
any contingent payments included in the determination of Profits ultimately are
not paid pursuant to an Alternative Disposition, then Parent shall reimburse
Stockholder for any amounts paid to Parent hereunder in respect of such
uncollected contingent payments promptly after receipt of written notice of
such non payment.
(c) Except for an increase made pursuant to Sections 5.09 and
5.13 of the Merger Agreement, in the event that after the date of this
Agreement, the amount of either the Class A Common Stock Merger Consideration,
Class B Common Stock Merger Consideration, Series B Merger Consideration,
Series C Merger Consideration, Series D Merger Consideration or the
consideration payable in respect of the Warrants, Unit Purchase Options,
Options or SARs as currently provided for in the Merger Agreement should be
increased (a "Second Transaction"), then, as may be requested by Parent, (i)
Stockholder shall, and shall cause each of its Affiliates who Beneficially Own
any of the Stockholder's Shares, to either execute and deliver to Parent such
documents or instruments as may be necessary to waive the right to receive the
amount of such increase to the extent that such increase results in any Profit
or (ii) Stockholder shall tender and pay, or cause to be tendered and paid, to
Parent, or its designee, in immediately available funds 100% of
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the Profit realized from such Second Transaction. As used in this Section 3(c),
Profit shall mean an amount equal to the excess, if any, of (y) the Second
Transaction Consideration over (z) the Current Transaction Consideration. As
used in this Agreement, Second Transaction Consideration shall mean all cash,
securities, settlement or termination amounts, notes or other debt instruments,
and other consideration received or to be received, directly or indirectly, by
the Stockholder and his Affiliates (excluding officers and directors of the
Company) in connection with or as a result of the Second Transaction or any
agreements or arrangements (including, without limitation, any employment
agreement (except a bonafide employment agreement pursuant to which the
Stockholder is required to devote, and under which Stockholder in good faith
intends to devote, substantially all of his business time and effort to the
performance of executive services for the Company in a manner substantially
similar to Stockholder's current employment arrangements with the Company),
consulting agreement, non-competition agreement, confidentiality agreement,
settlement agreement or release agreement) entered into, directly or
indirectly, by the Stockholder or his Affiliates (excluding officers and
directors of the Company) with the Company as a part of or in connection with
the Second Transaction.
4. Covenants, Representations and Warranties of the Stockholder.
(a) The Stockholder hereby represents, warrants and
covenants to Parent and Sub as follows:
(i) Ownership. The Stockholder is either (A) the
record and Beneficial Owner of, or (B) the Beneficial Owner but not
the record holder of, the number of issued and outstanding Shares set
forth on Part I of Schedule A hereto and the Warrants, Unit Purchase
Options, Options, SARs and Preferred Stock set forth on Part II of
Schedule A hereto. As of the date of this Agreement, the Shares set
forth on Part I of Schedule A hereto constitute all of the issued and
outstanding Shares owned of record or Beneficially Owned by the
Stockholder. Except as otherwise set forth in Part I to Schedule A,
the Stockholder has sole power of disposition, sole power of
conversion, sole power to demand appraisal rights and sole power to
agree to all of the matters set forth in this Agreement, in each case
with respect to all of the Shares set forth on Part I of Schedule A
hereto, with no material limitations, qualifications or restrictions
on such rights, subject to applicable securities laws and the terms of
this Agreement.
(ii) Power; Binding Agreement. The Stockholder has
the legal capacity, power and authority to enter into and perform all
of the Stockholder's obligations under this Agreement. This Agreement
has been duly and validly executed and delivered by the Stockholder
and constitutes a valid and binding agreement of the Stockholder,
enforceable against the Stockholder in accordance with its terms.
There is no beneficiary or holder of a voting trust certificate or
other interest of any trust of which the Stockholder is trustee whose
consent is required for the execution and delivery of this Agreement
or the consummation by the Stockholder of the transactions
contemplated hereby. If the Stockholder is married and the
Stockholder's Shares constitute community property, this Agreement has
been duly
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authorized, executed and delivered by, and constitutes a valid and
binding agreement of, the Stockholder's spouse, enforceable against
such person in accordance with its terms.
(iii) No Conflicts. Except for the filing of an
amendment to the Stockholder's Schedule 13D, no filing with, and no
permit, authorization, consent or approval of, any state or federal
public body or authority is necessary for the execution of this
Agreement by the Stockholder and the consummation by the Stockholder
of the transactions contemplated hereby, except where the failure to
obtain such consent, permit, authorization, approval or filing would
not interfere with the Stockholder's ability to perform his
obligations hereunder, and none of the execution and delivery of this
Agreement by the Stockholder, the consummation by the Stockholder of
the transactions contemplated hereby or compliance by the Stockholder
with any of the provisions hereof shall (A) result in a violation or
breach of, or constitute (with or without notice or lapse of time or
both) a default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under any of the
terms, conditions or provisions of any note, bond, mortgage,
indenture, license, contract, commitment, arrangement, understanding,
agreement or other instrument or obligation of any kind to which the
Stockholder is a party or by which the Stockholder or any of his
properties or assets may be bound, or (B) violate any order, writ,
injunction, decree, judgment, order, statute, rule or regulation
applicable to the Stockholder or any of his properties or assets, in
each such case except to the extent that any conflict, breach, default
or violation would not interfere with the ability of the Stockholder
to perform the obligations hereunder.
(iv) No Encumbrances. Except (A) as required by
Sections 2 and 3, (B) for pledges or encumbrances created in
compliance with Section 4(a)(vi), and (C) items listed in Part I to
Schedule A which shall be released or modified to comply with Section
4(a)(vi) not later than 10 business days after the date hereof, at all
times thereafter during the term hereof, all of the Stockholder's
Shares will be held by such Stockholder, an Affiliate of Stockholder,
or by a nominee or custodian for the benefit of such Stockholder, free
and clear of all liens, claims, security interests, proxies, voting
trusts or agreements, understandings or arrangements or any other
encumbrances whatsoever, except for any liens, claims, understandings
or arrangements that do not limit or impair Stockholder's ability to
perform his obligations under this Agreement.
(v) No Solicitation. The Stockholder shall comply
with the terms of Section 4.02(a) of the Merger Agreement.
(vi) Restriction on Transfer, Proxies and
Non-Interference. From and after the date of this Agreement and ending
as of the first to occur of the Effective Time or the first
anniversary of the Termination Date, the Stockholder shall not, and
shall cause each of his Affiliates who Beneficially Own any of the
Stockholder's Shares not to, directly or indirectly without the
consent of Parent in respect of any Acquisition Proposal or otherwise:
(A) offer for sale, sell, transfer, tender, pledge, encumber, assign
or otherwise dispose of, or enter into any contract, option or other
arrangement or understanding with respect to or
6
consent to the offer for sale, sale, transfer, tender, pledge,
encumbrance, assignment or other disposition of, any or all of the
Stockholder's Shares, or any interest therein, (B) grant any proxies
or powers of attorney, deposit any Stockholder's Shares into a voting
trust or enter into a voting agreement with respect to any
Stockholder's Shares, (C) enter into any agreement or arrangement
providing for any of the actions described in clause (A) or (B) above
or (D) take any action that could reasonably be expected to have the
effect of preventing or disabling the Stockholder from performing the
Stockholder's obligations under this Agreement; provided, however, the
Stockholder may, without the consent of Parent, pledge or encumber all
or any portion of the Stockholder's Shares in connection with a
bonafide lending transaction with any institutional lender that is not
entered into in connection with an Acquisition Proposal, if such
lending transaction provides that the lender shall give Parent at
least 15 business days prior notice before taking any sale or
foreclosure actions in respect of such pledged or encumbered the
Stockholder's Shares and shall during such time period extend Parent,
or its designee, the right to cure, support, purchase or acquire the
loan secured by such pledge or encumbrance upon such terms as may be
mutually agreed upon. The Stockholder shall provide the Parent with
copies of all agreements evidencing the above required provisions.
(vii) Waiver of Appraisal Rights. The Stockholder
hereby waives, and shall cause any of its Affiliates who hold of
record any of the Stockholder's Shares to waive, any rights of
appraisal or rights to dissent from the Merger that the Stockholder or
such Affiliate may have.
(viii) Further Assurances. From time to time, at
Parent's request and without further consideration, the Stockholder
shall execute and deliver such additional documents as may be
necessary or desirable to consummate and make effective, in the most
expeditious manner practicable, the transactions contemplated by this
Agreement.
(b) Parent and Sub hereby represent, warrant and
covenant to the Stockholder as follows:
(i) Organization, Standing and Corporate Power. Each
of Parent and Sub is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, with
adequate corporate power and authority to own its properties and carry
on its business as presently conducted. Each of Parent and Sub has the
corporate power and authority to enter into and perform all of its
obligations under this Agreement and to consummate the transactions
contemplated hereby.
(ii) No Conflicts. No filing with, and no permit,
authorization, consent or approval of, any state or federal public
body or authority is necessary for the execution of this Agreement by
either Parent or Sub and the consummation by Parent and Sub of the
transactions contemplated hereby, except where the failure to obtain
such consent, permit, authorization, approval or filing would not
interfere with its ability to perform its obligations hereunder, and
none of the execution and delivery of this Agreement by Parent or Sub,
the
7
consummation by Parent or Sub of the transactions contemplated hereby
or compliance by Parent and Sub with any of the provisions hereof
shall (A) conflict with or result in any breach of any applicable
organizational documents applicable to Parent or Sub, (B) result in a
violation or breach of, or constitute (with or without notice or lapse
of time or both) a default (or give rise to any third party right of
termination, cancellation, material modification or acceleration)
under any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, license, contract, commitment, arrangement,
understanding, agreement or other instrument or obligation of any kind
to which Parent or Sub is a party or by which Parent or Sub or any of
Parent's or Sub's properties or assets may be bound, or (C) violate
any order, writ, injunction, decree, judgment, order, statute, rule or
regulation applicable to Parent or Sub or any of Parent's or Sub's
properties or assets, in each such case except to the extent that any
conflict, breach, default or violation would not interfere with the
ability of Parent or Sub to perform its obligations hereunder.
(iii) Execution, Delivery and Performance by Parent
and Sub. The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby have been
duly authorized by the Boards of Directors of Parent and Sub, and each
of Parent and Sub has taken all other actions required by law, its
Certificate of Incorporation and its Bylaws to consummate the
transactions contemplated by this Agreement. This Agreement
constitutes the valid and binding obligations of Parent and Sub and is
enforceable in accordance with its terms, except as enforceability may
be subject to bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting creditors' rights
generally.
(c) The Company hereby represents and warrants to Parent and
Sub that the Board of Directors of the Company has approved the terms of this
Agreement and the transactions contemplated herein and such approval is
sufficient to render inapplicable to this Agreement and the transactions
contemplated herein the provisions of Section 203 of the Delaware General
Corporation Law.
5. Stop Transfer. From and after the date of this Agreement and ending
as of the first to occur of the Effective Time or the first anniversary of the
Termination Date, Stockholder will not request that the Company register (and
the Company agrees not to register) the transfer (book-entry or otherwise) of
any certificate or uncertificated interest representing any of the
Stockholder's Shares, except as contemplated by Section 4(a)(vi) hereof or as
otherwise contemplated hereby.
6. Recapitalization. Except in respect of the Spin Off contemplated by
the Merger Agreement (or an alternate transaction to the Spin Off), in the
event of a stock dividend or distribution, or any change in the Shares (or any
class thereof) by reason of any split-up, recapitalization, combination,
exchange of shares or the like, the term "Shares" shall include, without
limitation, all such stock dividends and distributions and any shares into
which or for which any or all of the Shares (or any class thereof) may be
changed or exchanged a may be appropriate to reflect such event.
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7. Stockholder Capacity. Except as set forth in Section 4(a)(v), the
Stockholder does not make any agreement or understanding herein in the
Stockholder's capacity as a director or officer of the Company and nothing
herein shall limit or affect any action taken by the Stockholder in such
capacity.
8. Merger Agreement and Options. The Stockholder hereby consents and
agrees to the cancellation or treatment of each share of Preferred Stock, each
Warrant, Unit Purchase Option, Option or SARs Beneficially Owned by Stockholder
or its Affiliates as set forth in Article II of the Merger Agreement.
9. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter hereof.
(b) Amendments, Waivers, Etc. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
parties hereto; provided that all of the provisions of this Agreement other
than Sections 4(c), 5 and this Section 9(b) may be amended without the consent
of the Company.
(c) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telegram,
telex or telecopy, or by mail (registered or certified mail, postage prepaid,
return receipt requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall be delivered to
the respective parties at the following addresses or the addresses set forth on
the signature pages hereto:
If to Xx. Xxxxxxxxx: Xxxxxx F. X. Sillerman
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
copy to: Xxxxxxxx Xxxxxx Xxxxxxxxxx & Xxxxxxxxx LLP
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxxxx
If to the Company: SFX Broadcasting, Inc.
000 Xxxx 00xx Xxxxxx
0
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Attn: Executive Vice President
copies to: Xxxxx & XxXxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Attn: Xxxx Xxxxxxxx
and
Xxxxxx, Xxxxx & Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxx
If to Parent or Sub: SBI Holding Corporation
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxxx X. Xxxxxx, Xx.
Telecopy: (000) 000-0000
and
copies to Hicks, Muse, Xxxx & Xxxxx Incorporated
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxxxx X. Xxxxxx, Xx.
Telecopy: (000) 000-0000
Xxxxxx & Xxxxxx L.L.P.
3700 Xxxxxxxx Xxxx Center
0000 Xxxx Xxxxxx
Xxxxxx, Xxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
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(d) Severability. Whenever possible, each provision or
portion of any provision of this Agreement will be interpreted in such manner
as to be effective and valid under applicable law but if any provision or
portion of any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such jurisdiction, and this
Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision or portion of any provision
had never been contained herein.
(e) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by the Stockholder of any covenants
or agreements contained in this Agreement will cause the Parent and Sub to
sustain damages for which they would not have an adequate remedy at law for
money damages, and therefore each of the parties hereto agrees that in the
event of any such breach the Parent or Sub shall be entitled to the remedy of
specific performance of such covenants and agreements and injunctive and other
equitable relief in addition to any other remedy to which they may be entitled,
at law or in equity.
(f) Remedies Cumulative. All rights, powers and remedies
provided under this Agreement or otherwise available in respect hereof at law
or in equity shall be cumulative and not alternative, and the exercise of any
thereof by any party shall not preclude the simultaneous or later exercise of
any other such right, power or remedy by such party.
(g) No Waiver. The failure of any party hereto to exercise
any right, power or remedy provided under this Agreement or otherwise available
in respect hereof at law or in equity, or to insist upon compliance by any
other party hereto with its obligations hereunder, and any custom or practice
of the parties at variance with the terms hereof, shall not constitute a waiver
by such party of its right to exercise any such or other right, power or remedy
or to demand such compliance.
(h) No Third Party Beneficiaries. This Agreement is not
intended to be for the benefit of, and shall not be enforceable by, any person
or entity who or which is not a party hereto; provided that, in the event of
the Stockholder's death, the benefits and obligations of the Stockholder
hereunder shall inure to his successors and heirs.
(i) Governing Law. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(j) Jurisdiction. Each party hereby irrevocably submits to
the exclusive jurisdiction of the Court of Chancery in the State of Delaware in
any action, suit or proceeding arising in connection with this Agreement, and
agrees that any such action, suit or proceeding shall be brought only in such
court (and waives any objection based on forum non conveniens or any other
objection to venue therein); provided, however, that such consent to
jurisdiction is solely for the purpose referred to in this paragraph and shall
not be deemed to be a general submission to the
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jurisdiction of said Court or in the State of Delaware other than for such
purposes. Each party hereto hereby waives any right to a trial by jury in
connection with any such action, suit or proceeding.
(k) Descriptive Headings. The descriptive headings used
herein are inserted for convenience of reference only and are not intended to
be part of or to affect the meaning or interpretation of this Agreement.
(l) Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same Agreement. This
Agreement shall not be effective as to any party hereto until such time as this
Agreement or a counterpart thereof has been executed and delivered by each
party hereto.
(m) Trust Funds. In the event that any party hereto should
receive any funds that are to be paid to another party pursuant to the terms of
this Agreement, then the receiving party shall hold such funds in trust for the
benefit of the party entitled to receive such funds and shall promptly pay such
funds to the party entitled to receive such funds in accordance with this
Agreement.
10. Termination. This Agreement shall terminate without any further
action on the part of any party hereto upon the occurrence of a termination of
the Merger Agreement pursuant to Sections 7.01(b)(ii), 7.01(b)(iii) or
7.01(b)(iv) thereof in respect of which the Company is entitled to request a
release of the Letter of Credit or Section 7.01(a) of the Merger Agreement.
Upon such termination, this Agreement shall forthwith become void and of no
further force or effect.
12
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed on this 24th day of August, 1997.
/s/ Xxxxxx F. X. Sillerman
---------------------------------
Xxxxxx F. X. Sillerman
SBI Holding Corporation
By: /s/ Xxxx Xxxxxx
------------------------------
Name: Xxxx Xxxxxx
---------------------------
Title:
--------------------------
SBI Radio Acquisition Corporation
By: /s/ Xxxx Xxxxxx
------------------------------
Name: Xxxx Xxxxxx
---------------------------
Title:
--------------------------
SFX Broadcasting, Inc.
By: /s/ Xxxxxx F. X. Sillerman
------------------------------
Name: Xxxxxx F. X. Sillerman
---------------------------
Title: Executive Chairman
--------------------------
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SCHEDULE A TO STOCKHOLDER AGREEMENT
PART I
SHARES
141,583 shares of Class A Common Stock.
1,024,168 shares of Class B Common Stock.
Certain of Xx. Xxxxxxxxx'x Shares have been pledged to Chase Manhattan
Bank, and Xx. Xxxxxxxxx will obtain within ten business days the
acknowledgement referred to in the proviso of Section 4(a)(vi) of this
Agreement.
PART II
OTHER SECURITIES
130,000 options to acquire shares of Class A Common Stock granted under the
Company's 1993 Stock Option Plan.
30,000 options to acquire shares of Class A Common Stock granted under the
Company's 1994 Stock Option Plan.
60,000 options to acquire shares of Class A Common Stock granted under the
Company's 1995 Stock Option Plan.
20,000 options to acquire shares of Class A Common Stock granted under the
Company's 1995 Stock Option Plan.
100,000 options to acquire shares of Class A Common Stock granted under the
Company's 1996 Stock Option Plan.
75,000 options to acquires shares of Class A Common Stock.
130,000 options to acquire shares of Class A Common Stock granted under the
Company's 1997 Stock Option Plan.
45,000 options to acquire shares of Class A Common Stock of Multi-Market Radio
("MMR") granted under MMR's 1993 Stock Option Plan.
20,000 options to acquire shares of Class A Common Stock of MMR granted under
MMR's 1994 Stock Option Plan to Xxxxxx F.X. Sillerman.
20,000 options to acquire shares of Class A Common Stock of MMR granted under
MMR's 1994 Stock Option Plan to The Sillerman Companies.
20,000 options to acquire shares of Class A Common Stock of MMR granted under
MMR's 1995 Stock Option Plan.
10,000 options to acquire shares of Class A Common Stock of MMR granted under
MMR's 1995 Stock Option Plan to The Sillerman Companies.
Warrants to acquire 600,000 shares of Class A Common Stock in the name of
Sillerman Communications Management Corporation.
Options to acquire 2,983 shares of Class A Common Stock.
Options to acquire 300,000 shares of Class A Common Stock pursuant to
Employment Agreement.
Options to acquire 25,000 shares of Class A Common Stock pursuant to Employment
Agreement.
