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EXHIBIT 10.54
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EXECUTION COPY
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AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
BETWEEN
CHANCELLOR MEDIA CORPORATION
AND
XXXXX X. XX XXXXXX
This Amended and Restated Employment Agreement (this
"Agreement") is made and entered into this 1st day of October, 1998 (the
"Execution Date"), to be effective as of April 17, 1998 (the "Effective Date"),
between Chancellor Media Corporation, a Delaware corporation (the "Company"),
Chancellor Media Corporation of Los Angeles, a Delaware corporation ("Los
Angeles") and Xxxxx X. xx Xxxxxx (the "Executive"), residing at 0000 Xxxxxx
Xxxx, Xxxxxxxx, Xxxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, the Company and the Executive entered into an
Employment Agreement between the Company and the Executive on May 18, 1998, to
be effective as of April 17, 1998 (the "Prior Employment Agreement"); and
WHEREAS, the Company and the Executive desire to modify and
clarify certain provisions of such Prior Employment Agreement by amending and
restating the Prior Employment Agreement;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and obligations hereinafter set forth, the parties agree as
follows:
1. DEFINITIONS
The following terms used in this Agreement shall have the
meaning specified below unless the context clearly indicates the contrary:
"Annual Bonus" shall mean the annual incentive bonus payable
to the Executive described in Section 4.
"Average Bonus" shall mean the greater of (a) (i) the total of
the Annual Bonuses paid hereunder with respect to the Employment Term, divided
by (ii) the length of such portion of the Employment Term in years (including
fractions) as falls on or prior to the last December 31 thereof and (b) One
Million Six Hundred Thousand Dollars ($1,600,000).
"Base Salary" shall mean the annual base salary payable to the
Executive at the rate set forth in Section 4.
"Board" shall mean the Board of Directors of the Company.
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"Broadcast Cash Flow" for any accounting period shall mean
station operating income for such accounting period for the stations owned or
operated by the Company as of the last day of such accounting period on a
consolidated basis excluding depreciation, amortization and corporate, general
and administrative expenses, calculated in a manner consistent with the
presentation of "broadcast cash flow" in the Company's periodic reports filed
with the Securities Exchange Commission.
"Broadcast Cash Flow Target" for any accounting period shall
mean one hundred five percent (105%) of the station operating income for the
corresponding accounting period falling twelve months earlier on a consolidated
basis, excluding depreciation, amortization and corporate, general and
administrative expenses, calculated in a manner consistent with the presentation
of "broadcast cash flow" in the Company's periodic reports filed with the
Securities Exchange Commission, with respect to the stations owned or operated
by the Company as of the last day of the accounting period for which the
Broadcast Cash Flow Target is calculated.
"Capstar" shall mean Capstar Broadcasting Corporation, a
Delaware corporation, which entity shall become the Company for purposes herein
upon the consummation of the Capstar Merger.
"Capstar Merger" shall mean the proposed merger of the Company
with and into a subsidiary of Capstar, subsequent to which Capstar will change
its name to Chancellor Media Corporation.
"Cause" shall mean the Executive's (a) habitual neglect of his
material duties or failure to perform his material obligations under this
Agreement, (b) refusal or failure to follow lawful directives of the Board, (c)
commission of an act of fraud, theft or embezzlement, or (d) conviction of a
felony or other crime involving moral turpitude; provided, however, that the
Company shall give the Executive written notice of any actions alleged to
constitute Cause under subsections (a) and (b) above, and the Executive shall
have a reasonable opportunity (as specified by the Compensation Committee) to
cure any such alleged Cause.
"Change in Control" shall mean (a) the sale, lease or other
transfer of all or substantially all of the assets of the Company to any person
or group (as such term is used in Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended); (b) the adoption by the stockholders of the Company of
a plan relating to the liquidation or dissolution of the Company; (c) the merger
or consolidation of the Company with or into another entity or the merger of
another entity into the Company or any subsidiary thereof with the effect that
immediately after such transaction the stockholders of the Company immediately
prior to such transaction (or their Related Parties) directly and indirectly
hold less than fifty percent (50%) of the total voting power of all securities
generally entitled to vote in the election of directors, managers or trustees of
the entity surviving such merger or consolidation; (d) the acquisition by any
person or group of more than fifty percent (50%) of the direct and indirect
voting power of all securities of the Company generally entitled to vote in the
election of directors of the Company; or (e) the majority of the Board is
composed of members who (i) have served less than twelve (12)
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months and (ii) were not approved by a majority of the Board at the time of
their election or appointment.
"Change in Operations" shall mean a change in the business
operating strategies of the Company (e.g. material cost controls or other
material restrictions on the Company's ability to increase its gross revenues)
which are imposed upon the Executive without his consent, and, in his reasonable
judgement, are fundamentally different from the business operating strategies in
effect at the Company on the Effective Date; provided, however, any expansion of
the Company's business into other media businesses, including, without
limitation, radio stations in small- or medium-sized markets, television,
outdoor advertising, and international media opportunities, shall not constitute
a Change in Operations. Any dispute as to whether a Change of Operations has
occurred shall be resolved pursuant to Section 14.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Common Stock" shall mean $0.01 par value common stock of the
Company.
"Compensation Committee" shall mean the Compensation Committee
of the Board.
"Consumer Price Index" shall mean the Consumer Price Index for
All Urban Consumers (1982-84=100) for all cities as reported by the United
States Bureau of Labor Statistics.
"Contract Year" shall mean each twelve (12) consecutive month
period during the Employment Term which begins on the Effective Date and each
annual anniversary thereof.
"Employment Inducements" shall mean any compensation,
including, without limitation, signing bonuses and stock options, that are paid
or granted to senior officers of the Company in connection with such officers'
initial hiring by the Company, or in connection with any amendments to or
extensions of the term of such senior officers' employment agreements with the
Company.
"Employment Term" shall mean the period beginning on the
Effective Date and ending on the close of business on the effective date of the
Executive's termination of employment with the Company.
"Excise Tax" shall mean the taxes imposed by Code Section
4999.
"Expiration Date" shall have the meaning ascribed to such term
in Section 2.
"Good Reason" shall mean (a) the Company's material breach of
any provision hereof, (b) the Executive no longer directly reporting to Xxxxxxx
X. Xxxxxx or Xxxxxx X. Xxxxx, (c) any adverse change in the Executive's job
responsibilities, duties,
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functions, status, offices, title, perquisites or support staff, (d) relocation
of the Executive's regular work address by more than ten (10) miles without his
consent, (e) a Change in Operations, (f) the Executive's failure, at any time,
to be permitted to serve as a member of the Board or (g) a Change in Control;
provided, however, that the Executive shall give the Company written notice of
any actions (other than those set out in subsections (e) or (g) above) alleged
to constitute Good Reason and the Company shall have a reasonable opportunity to
cure any such alleged Good Reason.
"New Chancellor" shall mean, from and after the consummation
of the Capstar Merger, Chancellor Media Corporation, a Delaware corporation, as
successor by name change to Capstar.
"Option Agreement" shall mean the agreement between the
Executive and the Company pursuant to which any Option is granted to the
Executive.
"Option Plan" shall mean the 1998 Chancellor Media Corporation
Non-Qualified Stock Option Plan, as amended from time to time, and any successor
thereto.
"Options" shall mean the non-qualified stock options to be
granted to the Executive hereunder.
"Permanent Disability" shall mean the Executive's inability to
perform the duties contemplated by this Agreement by reason of a physical or
mental disability or infirmity which has continued for more than ninety (90)
working days (excluding vacation) in any twelve (12) consecutive month period as
determined by the Board. The Executive agrees to submit such medical evidence
regarding such disability or infirmity as is reasonably requested by the Board.
"Prior Employment Agreement" shall be as defined in the
Recitals to this Agreement.
"Related Parties" shall mean with respect to any person (a)
the spouse and lineal ascendants and descendants of such person, and any sibling
of any of such persons and (b) any trust, corporation, partnership or other
entity, the beneficiaries, stockholders, partners, owners or persons
beneficially holding an eighty percent (80%) or more controlling interest of
which consist of persons referred to in subsection (a) above.
"Termination of Employment" shall mean the first to occur of
the following events:
(a) the date of death of the Executive;
(b) the effective date specified in the Company's
written notice to the Executive of the termination of his
employment as a result of his Permanent Disability, which
effective date shall not be earlier than the ninety-first
(91st) working day (excluding vacation) following the
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commencement of the Executive's inability to perform his
duties hereunder;
(c) the effective date specified in the Company's
written notice to the Executive of the Company's termination
of his employment without Cause;
(d) the effective date specified in the Company's
written notice to the Executive of the Company's termination
of his employment for Cause;
(e) the effective date specified in the Executive's
written notice to the Company of the Executive's termination
of his employment for Good Reason;
(f) the effective date specified in the Executive's
written notice to the Company of the Executive's termination
of his employment without Good Reason; and
(g) the date the Executive's employment terminates
pursuant to Section 2.
"Termination without Cause" shall mean a termination by the
Company of the Executive's employment without Cause.
2. EMPLOYMENT
The Company agrees to continue the employment of the
Executive, and the Executive agrees to continue to provide services to the
Company from the date of this Agreement until the close of business on the fifth
(5th) anniversary of the Effective Date (the "Expiration Date"), unless the
Executive's employment is earlier terminated pursuant to a Termination of
Employment. The Executive will serve the Company subject to the general
supervision, advice and direction of the Board and the Chief Executive Officer
and upon the terms and conditions set forth in this Agreement.
3. TITLE AND DUTIES
(a) The Executive's job title shall be President of Chancellor
Radio Group, a division of the Company. During the Employment Term, the
Executive shall have primary executive authority over the Company's operations
in radio in all markets and such other authority and duties as are usual and
customary for such position, and shall perform such additional services and
duties as the Board may from time to time designate consistent with such
position. Throughout the Employment Term, the Company shall also nominate the
Executive to serve as a member of the Board and upon such nomination Executive
shall agree to so serve.
(b) The Executive shall report solely to the Chief Executive
Officer of the Company. All other senior radio operating executives of the
Company shall report
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directly to the Executive, and the Executive shall be responsible for reviewing
the performance of such senior radio operating executives of the Company.
(c) The Executive shall devote his full business time and best
efforts to the business affairs of the Company; however, the Executive may
devote reasonable time and attention to:
(i) serving as a director of, or member of a
committee of the directors of, any not-for-profit organization
or engaging in other charitable or community activities; and
(ii) serving as a director of, or member of a
committee of the directors of, the corporations or
organizations for which the Executive presently serves in such
capacity, and such other corporations and organizations that
the Board may from time to time approve in the future.
4. COMPENSATION AND BENEFITS
(a) Base Compensation. During the Employment Term, the Company
shall pay the Executive, in installments according to the Company's regular
payroll practice, Base Salary at the annual rate of Nine Hundred Thousand
Dollars ($900,000) for the first (1st) Contract Year; and subject to increase
for each subsequent Contract Year an amount equal to the product of
(i) the Base Salary for the immediately preceding
Contract Year; and
(ii) the ratio of the Consumer Price Index for the
last complete calendar month in such preceding Contract Year
to the Consumer Price Index for the same month in the year
preceding such preceding Contract Year
; provided, however, that in no event shall the Base Salary for any subsequent
Contract Year be less than the Base Salary in the immediately preceding Contract
Year.
(b) Annual Incentive Bonus. The Executive shall be entitled to
an Annual Bonus for each calendar year during which he is employed hereunder.
Such Annual Bonus for any such calendar year shall be equal to five percent (5%)
of the excess, if any, of Broadcast Cash Flow for the portion of such calendar
year during which the Executive is employed over the Broadcast Cash Flow Target
for such portion of such calendar year, but in no event more than Three Million
Dollars ($3,000,000) in any calendar year or, for the calendar year, if any, in
which this contract terminates, the product of Three Million Dollars
($3,000,000) and the fraction of such calendar year which precedes the date of
such termination. The Executive's Annual Bonus earned with respect to each
calendar year shall be paid at the same time as annual incentive bonuses with
respect to that calendar year are paid to other senior executives of the Company
generally, but in no event later than March 31 of the following calendar year.
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(c) Stock Options.
(i) On the Effective Date and each of the first four
(4) anniversaries thereof on which the Executive remains
employed hereunder, the Executive shall be granted an Option
to purchase One Hundred Sixty Thousand (160,000) shares of
Common Stock. In the event the Executive's employment
hereunder is terminated by the Company without Cause or by the
Executive for Good Reason prior to the Expiration Date, the
Executive shall be granted, as of the date of such Termination
of Employment, a number of Options equal to Eight Hundred
Thousand (800,000) minus the number of Options previously
granted pursuant to the immediately preceding sentence.
(ii) All Options described in paragraph (i) above
shall be granted subject to the following terms and
conditions: (A) the Options shall be granted under and subject
to the Option Plan; (B) the exercise price of the Options
issued on the Effective Date shall be $41.50 and all other
options described in paragraph (i) shall have an exercise
price equal to the last reported sale price of the Common
Stock on the Nasdaq National Market System (or other principal
trading market for the Common Stock) at the close of the
trading day immediately preceding the date as of which the
grant is made; provided, however, that with respect to any
Options the grant of which is accelerated because the
Executive's employment is terminated either by the Company or
the Executive as a result of a Change in Control, the exercise
price of such Options shall be the lower of (x) the exercise
price equal to the average last reported sale price on the
Nasdaq National Market System (or other principal trading
market for the Common Stock) for the 30 trading days prior to
the ten trading days ending at the close of the trading day
immediately preceding the date any announcement of such Change
in Control is made and (y) an exercise price equal to the last
reported sale price of the Common Stock on the Nasdaq National
Market System (or other principal trading market for the
Common Stock) at the close of the trading day immediately
preceding the date as of which the grant is made; (C) each
Option shall be vested on the date of grant; (D) each Option
shall be exercisable for the ten (10) year period following
the date of grant; (E) each Option shall be evidenced by, and
subject to, an Option Agreement; and (F) the number of shares
granted shall be subject to adjustment for any subsequent
stock splits.
(iii) The Option Agreements shall specify that such
Options shall remain exercisable for the periods described in
paragraph (ii) above notwithstanding any Termination of
Employment.
(d) Vacation. During each complete twelve (12) month period of
the Employment Term, the Executive shall be entitled to no fewer than four (4)
weeks of paid vacation (unless, based on his length of service with the Company
and his position with the Company, the Executive is entitled to a greater number
of weeks of paid
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vacation under the Company's generally applicable vacation policy, as determined
by the Compensation Committee).
(e) Employee Benefit Plans. During the Employment Term, the
Executive shall be entitled to participate in all pension, profit sharing and
other retirement plans, all incentive compensation plans and all group health,
hospitalization and disability insurance plans and other employee welfare
benefit plans in which other senior executives of the Company may participate on
terms and conditions no less favorable than those which apply to such other
senior executives of the Company.
(f) Company Payment of Health Benefit Coverage. During the
Employment Term, the Company shall pay the amount of premiums or other cost
incurred for coverage of the Executive and his eligible spouse and dependent
family members under the applicable Company health benefits arrangement
(consistent with the terms of such arrangement).
(g) Life Insurance Policy. In addition to the insurance
coverage contemplated by Section 4(e), during the Employment Term, the Company
shall maintain in effect term life insurance coverage for the Executive with a
death benefit of at least Five Hundred Thousand Dollars ($500,000), subject to
the Executive's insurability at standard rates and with the beneficiary or
beneficiaries thereof designated by the Executive. Notwithstanding Section 9 of
this Agreement, such life insurance policy or policies may be assigned to a
trust for the benefit of any beneficiary designated by the Executive.
(h) Automobile and Parking Allowance; Other Benefits.
(i) During the Employment Term, the Company shall
either provide the Executive with, or pay or reimburse the
Executive for (A) his purchase or lease of an automobile of
the size and class of the Executive's current Company-provided
automobile; and (B) parking space at the Company's corporate
office maintained in Chicago, Illinois; and
(ii) During the Employment Term, the Company shall
provide the Executive with, or pay or reimburse the Executive
for, the cost incurred for membership of the Executive and his
spouse and dependent family members in the athletic club of
Executive's choosing and in the country club of Executive's
choosing.
(i) Most Favored Benefits. If the Company shall provide
employment related benefits (including, without limitation, benefits of the type
referred to by clauses (a) through (h) of this Section 4) in an aggregate amount
greater than or on more favorable terms and conditions (on an aggregate basis)
as are granted to any other senior executive of the Company (except for
Employment Inducements and benefits provided to the Chief Executive Officer of
the Company), the Executive shall be provided such benefits in substantially
comparable amount and/or under the substantially comparable terms and
conditions, as applicable, on an aggregate basis.
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(j) Execution Bonuses. The Executive shall be paid or granted,
as the case may be, the following Employment Inducements:
(i) Within fifteen (15) days after the execution and
delivery of the Prior Employment Agreement, the Company shall
pay to the Executive a one-time execution bonus in the gross
amount of One Million Dollars ($1,000,000);
(ii) Within thirty (30) days after the execution and
delivery of the Prior Employment Agreement, the Company shall
make a one-time cash payment to the Executive in a gross
amount such that the net payments retained by the Executive
after payment of any Excise Tax with respect to such payment
shall equal Five Million Dollars ($5,000,000); and
(iii) The Executive shall be granted an option to
purchase Eight Hundred Thousand (800,000) shares of Common
Stock (collectively, the "Execution Options"), subject to the
following terms and conditions: (A) the Execution Options
shall be granted under and subject to the Option Plan; (B) the
exercise price of the Execution Options shall be $42.125 per
share (the price per share at the close of trading on April
28, 1998); (C) the Executive Options shall be vested on the
date of grant; (D) each Executive Option shall be exercisable
for the ten (10) year period following the date of grant; and
(E) each Executive Option shall be evidenced by, and subject
to, an Option Agreement.
(iv) The Option Agreements shall specify that such
Options shall remain exercisable for the periods described in
paragraph (iii) above notwithstanding any Termination of
Employment.
5. REIMBURSEMENT OF EXPENSES
In addition to the compensation provided for under Section 4
hereof, upon submission of proper vouchers, the Company will pay or reimburse
the Executive for all normal and reasonable travel and entertainment expenses
incurred by the Executive during the Employment Term in connection with the
Executive's responsibilities to the Company.
6. TERMINATION BENEFITS
(a) Upon the termination of the Executive's employment with
the Company for any reason, the Company shall provide the Executive (or, in the
case of his death, his estate or other legal representative), (i) any Annual
Bonus earned but not yet paid with respect to the preceding calendar year, (ii)
all benefits due him under the Company's benefits plans and policies for his
services rendered to the Company prior to the date of such termination
(according to the terms of such plans and policies), (iii) not later than ninety
(90) days after such termination, in a lump sum, all Base Salary earned through
the date of such termination, and (iv) not later than ninety (90) days after
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termination, in a lump sum, any Annual Bonus earned with respect to that portion
of the calendar year prior to such termination.
(b) In the event that the Executive's employment hereunder is
terminated by the Company without Cause or by the Executive for Good Reason (but
not by reason of expiration or non-renewal of this Agreement), and subject to
the last sentence of this subsection (b), the Company shall make a one-time cash
payment to the Executive in a gross amount such that the net payments retained
by the Executive after payment of any applicable Excise Tax with respect to such
payment, and the payment of any income taxes on the amount over Five Million
Dollars ($5,000,000) that is so grossed-up and paid to the Executive on account
of any applicable Excise Tax, shall equal Five Million Dollars ($5,000,000).
Such payment shall be made at the time of any such termination without Cause or
within thirty (30) days of any such resignation for Good Reason. Such payment
shall be in full satisfaction of all obligations of the Company to Executive
hereunder (other than those obligations set forth in Sections 4(c), 4(j)(iii)
and 6(a)) and shall be conditioned on Executive giving a general release of the
Company and affiliates in the form used generally by the Company in the case of
the termination of employment of senior executives.
(c) (i) In the event that the Executive elects to
terminate his employment hereunder other than for Good
Reason, the Company, in consideration for the Executive's
agreement in Section 7(b), shall continue to pay him his Base
Salary as set forth in Section 4(a) through the fifth (5th)
anniversary of the Effective Date.
(ii) In addition, in such event, the Company may, by
written notice to the Executive given no later than fifteen
(15) days following his termination of employment, elect to
require the Executive to observe the provisions of Section
7(c) hereof. In such event, the Company shall, on the last day
of each calendar year through December 31, 2002 make a payment
to him equal to his Average Bonus, and on the last day of the
calendar year ending December 31, 2003 make a payment to him
equal to the product of his Average Bonus and the fraction of
such calendar year which precedes the Expiration Date.
(d) In the event that the Executive's employment is terminated
by reason of expiration or non-renewal of this Agreement the Company shall make
a (1) one time cash payment to the Executive equal to two (2) times the amount
of his annual Base Salary payable for the Contract Year ending on (or in which
falls) the date of Termination of Employment. Such payment shall be made at the
time of such Termination of Employment. Such payment shall be in full
satisfaction of all obligations of the Company to the Executive hereunder (other
than those obligations set forth in subsection (a)) and shall be conditioned on
the Executive giving a general release of the Company and affiliates in the form
used generally by the Company in the case of the termination of employment of
senior executives.
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(e) In the event of any Termination of Employment, the
Executive shall not be required to seek other employment to mitigate damages,
and any income earned by the Executive from other employment or self-employment
shall not be offset against any obligations of the Company to the Executive
under this Agreement.
7. PROTECTED INFORMATION; PROHIBITED SOLICITATION
(a) The Executive hereby recognizes and acknowledges that
during the course of his employment by the Company, the Company will furnish,
disclose or make available to the Executive confidential or proprietary
information related to the Company's business, including, without limitation,
customer lists, ideas and formatting and programming concepts and plans, that
such confidential or proprietary information has been developed and will be
developed through the Company's expenditure of substantial time and money, and
that all such confidential information could be used by the Executive and others
to compete with the Company. The Executive hereby agrees that all such
confidential or proprietary information shall constitute trade secrets, and
further agrees to use such confidential or proprietary information only for the
purpose of carrying out his duties with the Company and not to disclose such
information unless required to do so by subpoena or other legal process. No
information otherwise in the public domain (other than by an act of the
Executive in violation hereof) shall be considered confidential.
The Executive further agrees that all memoranda, notices,
files, records and other documents concerning the business of the Company, made
or compiled by the Executive during the period of his employment or made
available to him, shall be the Company's property and shall be delivered to the
Company upon its request therefor and in any event upon the termination of the
Executive's employment with the Company, provided, however, that the Executive
shall be permitted to retain copies of personal correspondence generated or
received by him during the Employment Term, subject to the use restrictions of
this Section 7(a).
(b) The Executive hereby agrees, in consideration of his
employment hereunder and in view of the confidential position to be held by the
Executive hereunder, that after any Termination of Employment, and through the
Expiration Date the Executive will not directly or indirectly induce any
employee of any of the Protected Companies (as defined below) to terminate such
employment or to become employed by any other radio broadcasting station.
(c) Should the Company make the election set forth in Section
6(c)(ii), the Executive further agrees that, from and after the Termination of
Employment and through the Expiration Date, he shall not be employed by or
perform activities on behalf of, or have an ownership interest in, (i) any radio
or television broadcasting station serving the same "Area of Dominant Influence"
(as reported by Arbitron) as any of the radio or television broadcasting
stations owned by the Company or its subsidiaries or affiliates, or the
subsidiaries or affiliates of any of the Company's direct or indirect
stockholders owning more than twenty percent (20%) of the Company (collectively
the "Protected Companies"), or (ii) any person, firm, corporation or other
entity, or in
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connection with any business enterprise, that is directly or indirectly engaged
in any of the radio, television, outdoor advertising or related business
activities in which the Company and its subsidiaries or the Protected Companies
have significant involvement (collectively, the "Competing Business Areas"), in
each case at the effective time of such Termination of Employment (other than
beneficial ownership of up to five percent (5%) of the outstanding voting stock
of a publicly traded company that owns such a competitor).
(d) The restrictions in this Section 7, to the extent
applicable, shall survive the termination of this Agreement and shall be in
addition to any restrictions imposed upon the Executive by statute or at common
law.
(e) The parties hereby acknowledge that the restrictions in
this Section 7 have been specifically negotiated and agreed to by the parties
hereto and are limited only to those restrictions necessary to protect the
Protected Companies from unfair competition. The parties hereby agree that if
the scope or enforceability of any provision, paragraph or subparagraph of this
Section 7 is in any way disputed at any time, and should a court find that such
restrictions are overly broad, the court may modify and enforce the covenant to
the extent that it believes to be reasonable under the circumstances. Each
provision, paragraph and subparagraph of this Section 7 is separable from every
other provision, paragraph, and subparagraph and constitutes a separate and
distinct covenant. The Executive acknowledges that the Protected Companies
operate in major and medium sized markets throughout the United States and that
the effect of Section 7(c) may be to prevent him from working in the Competing
Business Areas after his termination of employment hereunder.
8. INJUNCTIVE RELIEF
The Executive hereby expressly acknowledges that any breach or
threatened breach by the Executive of any of the terms set forth in Section 7 of
this Agreement may result in significant and continuing injury to the Company,
the monetary value of which would be impossible to establish. Therefore, the
Executive agrees that the Company shall be entitled to apply for injunctive
relief in a court of appropriate jurisdiction.
The provisions of this Section 8 shall survive the Employment Term.
9. PARTIES BENEFITED; ASSIGNMENTS
This Agreement shall be binding upon the Executive, his heirs
and his personal representative or representatives, and upon the Company and Los
Angeles and their respective successors and assigns. Neither this Agreement nor
any rights or obligations hereunder may be assigned by the Executive, other than
by will or by the laws of descent and distribution. From and after the
consummation of the Capstar Merger, all rights and obligations of the Company
under this Agreement shall be assigned to and assumed by the New Chancellor and
the term Company shall mean New Chancellor. The consummation of the Capstar
Merger shall not constitute a Change in Control.
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10. NOTICES
Any notice required or permitted by this Agreement shall be in
writing, sent by registered or certified mail, return receipt requested,
addressed to the Board and the Company at its then principal office, or to the
Executive at the address set forth in the preamble, as the case may be, or to
such other address or addresses as any party hereto may from time to time
specify in writing for the purpose in a notice given to the other parties in
compliance with this Section 10. Notices shall be deemed given when received.
11. GOVERNING LAW
This Agreement shall be governed by and construed and enforced
in accordance with the laws of the State of Texas, without regard to conflict of
law principles.
12. INDEMNIFICATION AND INSURANCE; LEGAL EXPENSES
The Company shall indemnify the Executive to the fullest
extent permitted by the laws of the State of Delaware, as in effect at the time
of the subject act or omission, and shall advance to the Executive reasonable
attorneys' fees and expenses as such fees and expenses are incurred (subject to
an undertaking from the Executive to repay such advances if it shall be finally
determined by a judicial decision which is not subject to further appeal that
the Executive was not entitled to the reimbursement of such fees and expenses)
and he will be entitled to the protection of any insurance policies the Company
may elect to maintain generally for the benefit of its directors and officers
("Directors and Officers Insurance") against all costs, charges and expenses
incurred or sustained by him in connection with any action, suit or proceeding
to which he may be made a party by reason of his being or having been a
director, officer or employee of the Company or any of its subsidiaries or his
serving or having served any other enterprise as a director, officer or employee
at the request of the Company (other than any dispute, claim or controversy
arising under or relating to this Agreement). The Company covenants to maintain
during the Employment Term for the benefit of the Executive (in his capacity as
an officer and director of the Company) Directors and Officers Insurance
providing benefits to the Executive no less favorable, taken as a whole, than
the benefits provided to the Executive by the Directors and Officers Insurance
maintained by the Company on the date hereof; provided, however, that the Board
may elect to terminate Directors and Officers Insurance for all officers and
directors, including the Executive, if the Board determines in good faith that
such insurance is not available or is available only at unreasonable expense.
13. REPRESENTATIONS AND WARRANTIES OF THE EXECUTIVE
The Executive represents and warrants to the Company that (a)
the Executive is under no contractual or other restriction which is inconsistent
with the execution of this Agreement, the performance of his duties hereunder or
the other rights of Company hereunder, and (b) the Executive is under no
physical or mental disability that would hinder the performance of his duties
under this Agreement.
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14. DISPUTES
Any dispute or controversy arising under, out of, in
connection with or in relation to this Agreement shall, at the election and upon
written demand of either the Executive or the Company, be finally determined and
settled by arbitration in the city of the Company's headquarters in accordance
with the rules and procedures of the American Arbitration Association, and
judgment upon the award may be entered in any court having jurisdiction thereof.
The Company shall pay the costs and expenses of such arbitration and the fees of
the Executive's counsel and experts unless the finder of fact determines that
the Company is the prevailing party in such arbitration.
15. FACILITY OF PAYMENT
All cash payments to be made by the Company to or on behalf of
the Executive hereunder shall be an obligation of and made by Los Angeles.
16. PRIOR EMPLOYMENT AGREEMENT
This Agreement shall supersede and replace in its entirety the
Prior Employment Agreement and, except as specifically described herein, all of
the Executive's and the Company's rights and obligations under the Prior
Employment Agreement are extinguished upon the effectiveness of this Agreement,
and the Executive acknowledges and agrees that he shall have no rights under the
Prior Employment Agreement, including, without limitation, any rights under
Section 6 of the Prior Employment Agreement. The Executive hereby withdraws any
and all termination notices previously delivered in connection with the Prior
Employment Agreement.
17. MISCELLANEOUS
The provisions of this Agreement shall survive the termination
of the Executive's employment with the Company. This Agreement contains the
entire agreement of the parties relating to the subject matter hereof. This
Agreement supersedes any prior written or oral agreements or understandings
between the parties relating to the subject matter hereof. No modification or
amendment of this Agreement shall be valid unless in writing and signed by or on
behalf of the parties hereto. A waiver of the breach of any term or condition of
this Agreement shall not be deemed to constitute a waiver of any subsequent
breach of the same or any other term or condition. This Agreement is intended to
be performed in accordance with, and only to the extent permitted by, all
applicable laws, ordinances, rules and regulations. If any provision of this
Agreement, or the application thereof to any person or circumstance, shall, for
any reason and to any extent, be held invalid or unenforceable, such invalidity
and unenforceability shall not affect the remaining provisions hereof and the
application of such provisions to other persons or circumstances, all of which
shall be enforced to the greatest extent permitted by law. The compensation
provided to the Executive pursuant to this Agreement shall be subject to any
withholdings and deductions required by any applicable tax laws. Any amounts
payable under this Agreement to the Executive after the death of the Executive
shall be paid to the Executive's estate or legal representative. The headings in
this
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Agreement are inserted for convenience of reference only and shall not be a
part of or control or affect the meaning of any provision hereof.
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IN WITNESS WHEREOF, the parties have duly executed and
delivered this Agreement as of the date first written above.
CHANCELLOR MEDIA CORPORATION
CHANCELLOR MEDIA CORPORATION OF LOS ANGELES
By: /s/ XXXXXXX X. XXXXXX
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Xxxxxxx X. Xxxxxx
President and Chief Executive Officer
/s/ XXXXX X. XX XXXXXX
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Xxxxx X. xx Xxxxxx
