Exhibit 10.1
EXECUTION COPY
SUPPORT AGREEMENT
SUPPORT AGREEMENT, dated as of February 6, 2006 (this
"Agreement"), by and among The Xxxx Disney Company, a Delaware corporation
("TWDC"), ABC Chicago FM Radio, Inc., a Delaware corporation and a direct,
wholly-owned subsidiary of TWDC ("Spinco"), Citadel Broadcasting Corporation, a
Delaware corporation ("Company"), with respect to Sections 5, 7, 8 and 10 herein
only, and Forstmann Little & Co. Equity Partnership-VI, L.P. ("Equity VI"),
Forstmann Little & Co. Equity Partnership-VII, L.P. ("Equity VII"), Forstmann
Little & Co. Subordinated Debt and Equity Management Buyout Partnership-VII,
L.P. ("Buyout VII") and Forstmann Little & Co. Subordinated Debt and Equity
Management Buyout Partnership-VIII, L.P. ("Buyout VIII" and, together, with
Equity VI, Equity VII and Buyout VII, the "Principal Stockholders"). Capitalized
terms used but not otherwise defined herein shall have the meanings ascribed to
them in the Merger Agreement (as defined below).
W I T N E S S E T H
WHEREAS, TWDC, Spinco, Company and Alphabet Acquisition Corp.,
a Delaware corporation and a direct, wholly-owned subsidiary of Company ("Merger
Sub") have entered into an Agreement and Plan of Merger, dated as of the date
hereof (as the same may be amended or supplemented, the "Merger Agreement"),
providing for, among other things, the merger of Merger Sub with and into Spinco
(the "Merger"), upon the terms and subject to the conditions set forth in the
Merger Agreement;
WHEREAS, as of the date hereof, Equity VI beneficially owns
34,484,608 shares of Company Common Stock, Equity VII beneficially owns
11,064,880 shares of Company Common Stock, Buyout VII beneficially owns
21,662,812 shares of Company Common Stock and Buyout VIII beneficially owns
9,065,403 (together, the "Company Shares") (such Company Shares, together with
any other shares of capital stock of Company acquired by the Principal
Stockholders after the date hereof and during the term of this Agreement
(including through the exercise of any stock options, warrants or similar
instruments), being collectively referred to herein as the "Subject Shares");
WHEREAS, simultaneously with the execution hereof each
Principal Stockholder shall cause each record holder of such Principal
Stockholder's Subject Shares to consent in writing, pursuant to Section 228 of
the DGCL, to the issuance of shares of Company Common Stock pursuant to the
Merger, the approval of the Merger and the other Transactions to which the
Company is a party, without a meeting, without prior notice and without a vote
by executing a Principal Stockholder Consent in the form of Exhibit A hereto
covering all such record holders' Subject Shares and deliver such Principal
Stockholder Consents to the secretary of Company; and
WHEREAS, as a condition and inducement to their willingness to
enter into the Merger Agreement, TWDC and Spinco have requested that each
Principal Stockholder enter into this Agreement and take certain actions set
forth herein.
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements contained in this
Agreement, the parties hereto agree as follows:
Section 1. Representations and Warranties of Each Principal
Stockholder. Each Principal Stockholder hereby represents and warrants to TWDC
and Spinco as follows:
(a) Ownership. Each Principal Stockholder is the record and
beneficial owner of, and has good and valid title to, the Company Shares set
forth opposite such Principal Stockholder's name on Schedule A attached hereto,
free and clear of any Encumbrances whatsoever. Each Principal Stockholder does
not own, of record or beneficially, any shares of capital stock of Company other
than the Subject Shares. Each Principal Stockholder has the sole right to vote
such Company Shares, and none of such Company Shares is subject to any voting
trust or other agreement, arrangement or restriction with respect to the voting
of such Company Shares, except as contemplated by this Agreement.
(b) Authority; No Conflict. Each Principal Stockholder is a
limited partnership duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization and has all requisite power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly executed and delivered by the
Principal Stockholders and constitutes a valid and binding obligation of the
Principal Stockholders enforceable against the Principal Stockholders in
accordance with its terms, subject to (i) bankruptcy, insolvency, moratorium and
other similar laws now or hereafter in effect relating to or affecting
creditors' rights generally, and (ii) general principles of equity (regardless
of whether considered in a proceeding at law or in equity). The execution and
delivery of this Agreement does not, and the consummation of the transactions
contemplated hereby and compliance with the terms hereof will not, conflict
with, result in any violation of, or constitute (with or without notice or lapse
of time or both) a default under, any provision of any trust agreement, loan or
credit agreement, bond, note, mortgage, indenture, lease, partnership agreement
or other contract, agreement, obligation, commitment, arrangement,
understanding, instrument, permit, concession, franchise or license or any
statute, law, ordinance, rule, regulation, judgment, order, notice or decree
applicable to any Principal Stockholder or to any of such Principal
Stockholder's property or assets, except for any of the foregoing as would not
reasonably be expected to prevent such Stockholder from performing its
obligations under this Agreement.
(c) No Filings; Consents. Other than as required under the
applicable requirements of the Securities Exchange Act of 1934, as amended and
including any regulations promulgated thereunder, no consents or approvals of or
filings or registrations with any Governmental Authority are necessary in
connection with (i) the execution and delivery by the Principal Stockholders of
this Agreement and (ii) the performance by the Principal Stockholders of their
respective obligations under this Agreement, including the delivery of the
Principal Stockholder Consent by each Principal Stockholder pursuant to Section
3(a) hereof.
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(d) Litigation. There is no action, suit, investigation,
complaint or other proceeding pending against any Principal Stockholder or, to
the knowledge of the Principal Stockholders, threatened against any Principal
Stockholder or any other Person that restricts in any material respect or
prohibits (or, if successful, would restrict or prohibit) the exercise by any
party or beneficiary of its rights under this Agreement or the performance by
any party of its obligations under this Agreement.
Section 2. Representations and Warranties of TWDC and Spinco.
TWDC and Spinco hereby represent and warrant to the Principal Stockholders that
TWDC and Spinco have all requisite corporate power and authority to enter into
this Agreement and to consummate the transactions contemplated hereby. This
Agreement has been duly authorized, executed and delivered by each of TWDC and
Spinco and constitutes a valid and binding obligation of TWDC and Spinco,
enforceable against TWDC and Spinco in accordance with its terms, subject to (i)
bankruptcy, insolvency, moratorium and other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally, and (ii) general
principles of equity (regardless of whether considered in a proceeding at law or
in equity). The execution and delivery of this Agreement does not, and the
consummation of the transactions contemplated hereby and compliance with the
terms hereof will not, conflict with, result in any violation of, or constitute
(with or without notice or lapse of time or both) default under, any provisions
of the certificate of incorporation or bylaws of TWDC or Spinco or any trust
agreement, loan or credit agreement, bond, note, mortgage, indenture, lease or
other contract, agreement, obligation, commitment, arrangement, understanding,
instrument, permit, concession, franchise or license or any statute, law,
ordinance, rule, regulation, judgment, order, notice or decree applicable to
TWDC, Spinco or any of their respective property or assets, except for any of
the foregoing as would not reasonably be expected to prevent such Stockholder
from performing its obligations under this Agreement.
Section 3. Covenants of Each Principal Stockholder. Each
Principal Stockholder agrees with TWDC and Spinco as follows:
(a) If, for any reason, there is a meeting of the Company
Stockholders or at any adjournment thereof or in any other circumstances upon
which a vote, consent or other approval of stockholders is sought, such
Principal Stockholder shall direct the voting of (or cause to be voted) its
Subject Shares against (i) any Company Acquisition Proposal, reorganization,
joint venture, recapitalization, dissolution, liquidation or winding up of or by
Company or any of its Subsidiaries and (ii) any amendment of the certificate of
incorporation or bylaws of Company or other proposal or transaction involving
Company or any of its Subsidiaries which amendment or other proposal or
transaction would or could reasonably be expected to impede, frustrate, prevent,
nullify or result in a material breach of any representation, warranty or
covenant or any other obligation or agreement of Company under or with respect
to, the Merger, the Merger Agreement or any of the Transactions to which the
Company is a party or transactions contemplated by this Agreement. Each
Principal Stockholder shall not, and shall not permit the record holder of any
of its Subject Shares to, commit or agree to take any action inconsistent with
the foregoing.
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(b) Each Principal Stockholder agrees not to, directly or
indirectly, transfer, sell, assign, exchange, pledge or otherwise dispose of
(including by gift) or encumber (collectively, "Transfer") any of the Subject
Shares, or to make any offer or agreement relating thereto, at any time prior to
the termination of this Agreement, except to any affiliate of such Principal
Stockholder who agrees in writing to be bound by the terms of this Agreement as
though such affiliate were a party hereto. Furthermore, the Principal
Stockholders shall not, except as contemplated by this Agreement, directly or
indirectly, grant any proxies or powers of attorney with respect to the Subject
Shares, deposit the Subject Shares into a voting trust or enter into a voting
agreement or any other arrangement with respect to the Subject Shares and shall
not commit or agree to take any of the foregoing actions. In furtherance of the
foregoing, each Principal Stockholder agrees that any Transfer in violation of
this Agreement shall be null and void and of no force or effect.
(c) Each Principal Stockholder shall be deemed to be a
representative at all times for purposes of Section 6.4 of the Merger Agreement
(regardless of whether such Principal Stockholder is in fact a representative at
the relevant time) and shall comply with the terms of Section 6.4(a) of the
Merger Agreement.
(d) Each Principal Stockholder shall use reasonable efforts to
promptly cause the following legend to be conspicuously noted on each
certificate representing the Subject Shares:
"The shares represented by this certificate are subject to a
Support Agreement dated as of February 6, 2006. The Support
Agreement restricts the transferability of the shares
represented by this certificate."
(e) Each Principal Stockholder shall not issue any press
release or make any other public statement with respect to the Merger Agreement,
the Merger, any other transactions contemplated hereby or the Transactions
without the written consent of TWDC (which consent shall not be unreasonably
withheld or delayed), except as may be required by applicable Law or Order
entered against such Principal Stockholder or by obligations pursuant to any
listing agreement with any national securities exchange, in which case the
Principal Stockholder proposing to issue such press release or order such public
announcement shall use its reasonable efforts to consult in good faith with TWDC
before making any such public announcements.
(f) Each Principal Stockholder hereby consents to and adopts
and approves the actions taken by the Company Board of Directors in adopting,
approving and declaring advisable this Agreement, the Merger Agreement, the
Merger, the issuance of shares of Company Common Stock pursuant to the Merger
and the other Transactions contemplated hereby or thereby.
Section 4. Principal Stockholder Capacity. Each Principal
Stockholder enters into this Agreement solely in such Principal Stockholder's
capacity as the record and/or beneficial owner of the Subject Shares. Nothing in
this Agreement shall limit or
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affect any actions taken by partners of any Principal Stockholder in such
individual's capacity as an officer or director of Company.
Section 5. Stop Transfer. Company agrees with, and covenants
to, TWDC and Spinco that Company shall instruct its transfer agent not to
register the transfer of any certificate representing any Principal
Stockholder's Subject Shares in violation of this Agreement.
Section 6. No Ownership Interest. Except as expressly set
forth in this Agreement, nothing contained in this Agreement shall be deemed to
vest in either TWDC or Spinco any direct or indirect ownership or incidence of
ownership of or with respect to any Subject Shares. All rights, ownership and
economic benefits of and relating to any Subject Shares shall remain and belong
to the Principal Stockholders, and neither TWDC nor Spinco shall have any
authority to exercise any power or authority to manage, direct, superintend,
restrict, regulate, govern or administer any of the policies or operations of
Company or exercise any power or authority to direct any Principal Stockholders
in the voting of any of the Subject Shares, except as otherwise expressly
provided in this Agreement.
Section 7. Assignment. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned, in whole or in
part (whether by operation of law or otherwise), by any Principal Stockholder or
Company, on the one hand, without the prior written consent of TWDC nor by TWDC
or Spinco, on the other hand, without the prior written consent of each
Principal Stockholder, and any attempt to make any such assignment without such
consent shall be null and void, except that TWDC or Spinco may assign, in its
sole discretion, any or all of its rights, interests and obligations hereunder
to any of its respective direct or indirect wholly owned Subsidiaries. Subject
to the preceding sentence, this Agreement will be binding upon, inure to the
benefit of and be enforceable by the parties and their respective successors and
assigns.
Section 8. Termination. This Agreement shall terminate upon
the earliest of (i) the Effective Time and (ii) the termination of the Merger
Agreement in accordance with its terms; provided, however, that any such
termination shall not relieve any party of any liability of such party arising
as a result of the intentional breach of this Agreement prior to such
termination.
Section 9. Additional Matters. Each Principal Stockholder
shall use reasonable efforts to take, or cause to be taken, all actions, and to
do, or cause to be done, and to assist and cooperate with the other parties in
doing, all things reasonably requested by TWDC from such Principal Stockholder
to consummate and make effective, in the most expeditious manner practicable,
the Merger, the other transactions contemplated hereby and the Transactions.
Each Principal Stockholder shall, and shall cause the record holder of its
Subject Shares to, from time to time, execute and deliver, or cause to be
executed and delivered, such additional or further consents, documents and other
instruments as TWDC or Spinco may reasonably request for the purpose of
effectively carrying out the transactions contemplated by this Agreement and the
Merger Agreement.
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Section 10. General Provisions.
(a) Modification. No supplement, modification or amendment of
this Agreement will be binding unless made in a written instrument that is
signed by all of the parties hereto and that specifically refers to this
Agreement.
(b) Costs and Expenses. All costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such expenses.
(c) Notice. All notices and other communications hereunder
shall be in writing and shall be deemed given upon receipt by the parties. All
notices hereunder shall be delivered to TWDC in accordance with Section 9.2 of
the Merger Agreement and to the Principal Stockholders at their respective
addresses set forth on Schedule A hereto.
(d) Interpretation. Words herein in the singular shall be held
to include the plural and vice versa and words of one gender shall be held to
include the other genders as the context requires. The terms "hereof," "herein,"
and "herewith" and words of similar import herein (or in the Merger Agreement or
any Ancillary Agreement) shall, unless otherwise stated, be construed to refer
to this Agreement (or the Merger Agreement or applicable Ancillary Agreement)
taken as a whole (including all of the schedules and exhibits thereto) and not
to any particular provision of this Agreement (or the Merger Agreement or such
Ancillary Agreement). Section references are to the Sections of this Agreement
unless otherwise specified. The word "including" and words of similar import
when used in this Agreement (or the Merger Agreement or the applicable Ancillary
Agreement) means "including, without limitation," unless the context otherwise
requires or unless otherwise specified. Unless expressly stated to the contrary
in this Agreement, the Merger Agreement or in any Ancillary Agreement, all
references to "the date hereof," "the date of this Agreement," "hereby" and
"hereupon" and words of similar import shall all be references to February 6,
2006 (or the date of which the Merger Agreement or relevant Ancillary Agreement
is first entered into, as the case may be) regardless of any amendment or
restatement hereof (or thereof). The parties have participated jointly in the
negotiation and drafting of this Agreement, and in the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties, and no presumption or burden of proof
shall arise favoring or disfavoring any party hereto by virtue of the authorship
of any provisions of this Agreement.
(e) Counterparts. This Agreement may be executed in one or
more counterparts, all of which will be considered one and the same agreement
and will become effective when one or more counterparts have been signed by each
party and delivered to the other parties, it being understood that all the
parties need not sign the same counterpart.
(f) Entire Agreement; No Third Party Beneficiaries. This
Agreement (including the documents and the instruments referred to herein) (i)
constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral,
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among the parties with respect to the subject matter hereof and (ii) is not
intended to confer upon any person other than the parties hereto any rights or
remedies hereunder.
(g) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(h) Enforcement. The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement, in addition to any other remedy to
which they are entitled at law or in equity. The parties hereby (i) submit to
the jurisdiction of any federal or state court sitting in the State of Delaware,
(ii) agree not to object to venue in such courts or to claim that such forum is
inconvenient and (iii) agree that notice or the service of process in any
proceeding shall be properly served or delivered if delivered in the manner
contemplated by Section 10(c) hereof. IN ADDITION, EACH OF THE PARTIES HERETO
WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY CLAIM OR PROCEEDING
RELATED TO OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY. Without limiting the generality of the foregoing, the
parties hereto expressly agree that the obligations of Stockholder set forth in
Section 3 hereof shall be subject to the foregoing provisions of this Section
10(h).
(i) Severability. This Agreement shall be deemed severable;
the invalidity or unenforceability of any term or provision of this Agreement
shall not affect the validity or enforceability of the balance of this Agreement
or of any other term hereof, which shall remain in full force and effect. If of
any of the provisions hereof are determined to be invalid or unenforceable, the
parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible.
[SIGNATURE PAGE FOLLOWS]
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SCHEDULE A
IN WITNESS WHEREOF, TWDC, Spinco, Company and the Principal
Stockholders have caused this Agreement to be signed by their respective
officers thereunto duly authorized, all as of the date first written above.
THE XXXX DISNEY COMPANY
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Executive Vice President,
Chief Financial Officer
ABC CHICAGO FM RADIO, INC.
By: /s/ Xxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
CITADEL BROADCASTING CORPORATION
By: /s/ Xxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxx Xxxxxxx
Title: Chief Executive Officer
FORSTMANN LITTLE & CO.
EQUITY PARTNERSHIP-VI, L.P.
By: /s/ T. Xxxxxxxx XxXxx
-----------------------------------------
Name: T. Xxxxxxxx XxXxx
Title: General Partner
FORSTMANN LITTLE & CO.
EQUITY PARTNERSHIP-VII, L.P.
By: /s/ T. Xxxxxxxx XxXxx
-----------------------------------------
Name: T. Xxxxxxxx XxXxx
Title: General Partner
FORSTMANN LITTLE & CO.
SUBORDINATED DEBT AND
EQUITY MANAGEMENT BUYOUT
PARTNERSHIP-VII, L.P.
By: /s/ T. Xxxxxxxx XxXxx
-----------------------------------------
Name: T. Xxxxxxxx XxXxx
Title: General Partner
FORSTMANN LITTLE & CO.
SUBORDINATED DEBT AND
EQUITY MANAGEMENT BUYOUT
PARTNERSHIP-VIII, L.P.
By: /s/ T. Xxxxxxxx XxXxx
-----------------------------------------
Name: T. Xxxxxxxx XxXxx
Title: General Partner
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