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STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT, dated as of February 12, 1996, is
among JACOR COMMUNICATIONS, INC., an Ohio corporation ("Parent"), JCAC, INC., a
Florida corporation and a wholly owned subsidiary of Parent ("Acquisition"),
GREAT AMERICAN INSURANCE COMPANY, an Ohio corporation ("Seller A"), AMERICAN
FINANCIAL CORPORATION, an Ohio corporation ("Seller B"), AMERICAN FINANCIAL
ENTERPRISES, INC., a Connecticut corporation ("Seller C"), XXXX X. XXXXXXX
("Seller D"), THE XXXX X. XXXXXXX FOUNDATION, a charitable foundation ("Seller
E") and S. XXXXX XXXXXXX ("Seller F"). Seller A, Seller B, Seller C, Seller
D, Seller E and Seller F are sometimes individually referred to herein as a
"Seller" and are sometimes collectively referred to herein as the "Sellers".
WHEREAS, Parent, Acquisition, and Citicasters Inc., a Florida
corporation (the "Company"), are, concurrently with the execution of this
Agreement, entering into an Agreement and Plan of Merger (the "Merger
Agreement"), which provides, among other things, upon the terms and subject to
the conditions thereof, that Acquisition will be merged with and into the
Company in accordance with the Florida Business Corporation Act (the "Merger")
such that each share of Class A Common Stock, par value $.01 per share, of the
Company (the "Shares") issued and outstanding immediately prior to the
effective time of the Merger (other than Shares owned by the Company, Parent,
Acquisition or any direct or indirect subsidiary of the Company, Parent or
Acquisition, and any Shares held in the treasury of the Company) will be
converted into the right to receive the Merger Consideration (as defined in the
Merger Agreement);
WHEREAS, each Seller owns the number of Shares (the "Seller's
Shares") set forth on Schedule A hereto opposite the name of such Seller; and
WHEREAS, in order to induce Parent and Acquisition to enter
into the Merger Agreement, each Seller has agreed to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements herein contained, and intending to be legally
bound hereby, Parent, Acquisition and the Sellers hereby agree as follows.
Section 1. REPRESENTATIONS AND WARRANTIES OF SELLERS.
Each Seller represents and warrants to Parent and Acquisition as follows:
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(a) Each of Seller A, Seller B and Seller C is a
corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation.
(b) Each of Seller A, Seller B, Seller C and Seller E has
all necessary power and authority to execute and deliver this Agreement, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby.
(c) The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby have
been duly and validly authorized by the board of directors of each of Seller A,
Seller B, Seller C and Seller E and no other proceedings on the part of any of
Seller A, Seller B, Seller C or Seller E are necessary to authorize this
Agreement or to consummate the transactions so contemplated.
(d) This Agreement has been duly and validly executed and
delivered by each Seller and constitutes a legal, valid and binding agreement
of each Seller enforceable against each Seller in accordance with its terms,
except that the enforceability hereof may be subject to applicable bankruptcy,
insolvency or other similar laws now or hereinafter in effect affecting
creditors' rights generally.
(e) The execution, delivery and performance by the
Sellers of this Agreement and the consummation of the transactions contemplated
hereby do not and will not (i) contravene or conflict with the Certificate of
Incorporation or By-Laws of any of Seller A, Seller B or Seller C or any
organizational or governing documents of Seller E; (ii) contravene or conflict
with or constitute a violation of any provision of any law, regulation,
judgment, injunction, order or decree binding upon or applicable to any Seller,
any of their respective subsidiaries or any of their respective properties;
(iii) conflict with, or result in the breach or termination of any provision of
or constitute a default (with or without the giving of notice or the lapse of
time or both) under, or give rise to any right of termination, cancellation, or
loss of any benefit to which any Seller or any of its subsidiaries is entitled
under any provision of any agreement, contract, license or other instrument
binding upon such Seller, any of its subsidiaries or any of their respective
properties, or allow the acceleration of the performance of, any obligation of
any Seller or any of its subsidiaries under any indenture, mortgage, deed of
trust, lease, license, contract, instrument or other agreement to which such
Seller or any of its subsidiaries is a party or by which any Seller or any of
its subsidiaries or any of their respective assets or properties is subject or
bound; or (iv) result in the creation or imposition of any security interests,
liens, claims, pledges, charges, voting agreements or other encumbrances of any
nature whatsoever (collectively, "Liens") on any asset of any Seller or any of
its subsidiaries, except in the case of clauses (ii), (iii)
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and (iv) for any such contraventions, conflicts, violations, breaches,
terminations, defaults, cancellations, losses, accelerations and Liens which
would not individually or in the aggregate materially interfere with the
consummation of the transactions contemplated by this Agreement.
(f) As of the date hereof, none of the Sellers and none
of their respective properties is subject to any order, writ, judgment,
injunction, decree, determination or award which would prevent or delay the
consummation of the transactions contemplated hereby.
(g) Each Seller has, and at all times between the date of
this Agreement and the consummation of the Merger such Seller will have, (i)
good and valid title to such Seller's Shares, free and clear of any Liens and
(ii) the right to vote such Seller's Shares.
(h) There are no options or rights to acquire, or any
agreements to which any Seller is a party relating to, any Seller's Shares,
other than this Agreement.
(i) The Seller's Shares described in Schedule A represent
all of the Shares beneficially owned (within the meaning of Rule 13d-3 under
the Exchange Act) by any of the Sellers.
Section 2. REPRESENTATIONS AND WARRANTIES OF PARENT AND
ACQUISITION. Each of Parent and Acquisition represents and warrants to the
Sellers as follows:
(a) Each of Parent and Acquisition is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation.
(b) Each of Parent and Acquisition has all necessary
corporate power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions contemplated
hereby.
(c) The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby have
been duly and validly authorized by the board of directors of each of Parent
and Acquisition and no other corporate proceedings on the part of Parent or
Acquisition are necessary to authorize this Agreement or to consummate the
transactions so contemplated.
(d) This Agreement has been duly and validly executed and
delivered by each of Parent and Acquisition and constitutes a legal, valid and
binding agreement of each of Parent and Acquisition enforceable against each of
Parent and Acquisition in accordance with its terms, except that the
enforceability hereof
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may be subject to applicable bankruptcy, insolvency, or other similar laws, now
or hereinafter in effect affecting creditors' rights generally.
Section 3. NEGATIVE COVENANTS OF SELLERS. Except as
provided for herein or in the Merger Agreement, each Seller agrees not to
(either directly or indirectly):
(a) sell, transfer, pledge, assign, hypothecate or
otherwise dispose of, or enter into any contract, option or other arrangement
or understanding with respect to the sale, transfer, pledge, assignment,
hypothecation or other disposition of such Seller's Shares (including, without
limitation, through the disposition or transfer of control of another person)
other than to an affiliate of Seller D that agrees to be bound by this
Agreement;
(b) grant any proxies with respect to such Seller's
Shares, deposit such Seller's Shares into a voting trust or enter into a voting
agreement with respect to any of such Seller's Shares; or
(c) take any action which would make any representation
or warranty of any Seller herein untrue or incorrect in any material respect.
Section 4. NO SOLICITATION. (a) From and after the
date of this Agreement and except as set forth in subsection 4.(b), the Sellers
shall not, and the Sellers shall use their reasonable best efforts to cause the
Company not to, directly or indirectly, (i) solicit, initiate, knowingly
encourage, or participate in discussions or negotiations regarding, any
proposals or offers from any individual, corporation, partnership, limited
liability corporation, joint venture, trust, association, unincorporated
organization, other entity, group or governmental authority ("Person") relating
to any Competing Transaction (as defined in subsection 4.(c)) or (ii) furnish
to any other Person any nonpublic information or access to such information
with respect to, or otherwise concerning, any Competing Transaction. The
Sellers shall immediately cease and cause to be terminated any existing
discussions or negotiations with any third parties conducted heretofore with
respect to any proposed Competing Transaction. The Sellers shall promptly
disclose to Parent the identity of any Person who attempts to initiate any
discussions contemplating a Competing Transaction.
(b) Notwithstanding anything to the contrary contained in
this Section 4 or in any other provision of this Agreement, until the consents
required by Section 5 have been duly executed and delivered, the Sellers shall
not be required to cause the Company to refrain from (i) participating in
discussions or negotiations with, and, during such period, furnishing
information to, a Person that seeks to engage in discussions or negotiations,
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requests information or makes a proposal to acquire the Company pursuant to a
Competing Transaction, if the Company's directors have determined in good faith
that such action is required for the discharge of their fiduciary obligations,
based upon the written advice of independent legal counsel, who may be the
Company's regularly engaged legal counsel (a "Director Duty"); or (ii)
terminating this Agreement and entering into an agreement providing for a
Competing Transaction in accordance with a Director Duty. In the event that
the Sellers participate (directly or indirectly) in discussions or negotiations
with, or furnish information to, a Person that seeks to engage in such
discussions or negotiations, requests information or makes a proposal to
acquire the Company pursuant to a Competing Transaction pursuant to this
subsection 4.(b), then: (i) the Sellers shall immediately disclose to Parent
the decision of the Company's directors; (ii) the identity of the Person; and
(iii) copies of all information or material not previously furnished to Parent
or Acquisition which the Sellers, the Company, or their respective agents
provides or causes to be provided to such Person or any of its officers,
directors, employees, agents, advisors or representatives.
(c) For the purposes of this Agreement, "Competing
Transaction" shall mean any of the following involving the Company: (i) any
merger, consolidation, share exchange, business combination or other similar
transaction; (ii) any sale, lease, exchange, transfer or other disposition of
all or substantially all of the assets of the Company and its subsidiaries,
taken as a whole, in a single transaction or series of related transactions; or
(iii) any tender offer or exchange offer for Shares.
Section 5. WRITTEN CONSENT.
(a) Prior to the close of business on the thirtieth day
following the date of this Agreement (the "Delivery Date"), unless the Merger
Agreement has been terminated on or prior to the Delivery Date, each Seller
will execute and deliver to the corporate secretary of the Company a written
consent with respect to such Seller's Shares in the form attached hereto as
Exhibit A, which written consent will not be withdrawn or revoked. Such
written consents of the Sellers will constitute the irrevocable written consent
of each of the Sellers with respect to his or its Seller's Shares to the
approval and adoption of the Merger Agreement.
(b) For so long as this Agreement is in effect, in any
meeting of the stockholders of the Company, however called, and in any action
by consent of the stockholders of the Company, each Seller shall vote or cause
to be voted all of such Seller's Shares: (i) against any action or agreement
that would result in a breach in any material respect of any covenant,
representation or warranty or other obligation of any Seller under this
Agreement or of the Company, Parent or Acquisition under the Merger Agreement;
(ii)
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against any action or agreement that would impede, interfere with or discourage
the transactions contemplated by this Agreement or the Merger Agreement,
including, without limitation: (1) any extraordinary corporate transaction,
such as a merger, reorganization or liquidation involving the Company or any of
its subsidiaries, (2) a sale or transfer of a material amount of assets of the
Company, or any of its subsidiaries or the issuance of securities by the
Company or any of its subsidiaries, (3) any change in the board of directors of
the Company, (4) any change in the present capitalization or dividend policy of
the Company (other than as contemplated by the Merger Agreement) or (5) any
other material change in the Company's corporate structure or business; and
(iii) in favor of any action or agreement that would further the consummation
of the transactions contemplated by this Agreement or the Merger Agreement.
Section 6. REGISTRATION AGREEMENT. Prior to the closing
of the Merger, the parties will enter into an agreement providing for shelf
registration of resale of the Warrants and the Warrant Shares (each as defined
in the Merger Agreement) with terms and conditions customary for transactions
that are similar to the Merger.
Section 7. SPECIFIC PERFORMANCE. The parties hereto
agree that irreparable damage would occur in the event any provision of this
Agreement was not performed in accordance with the terms hereof and that the
parties shall be entitled to specific performance of the terms hereof, in
addition to any other remedy at law or in equity.
Section 8. EXPENSES. Each party shall bear its own
expenses and costs in connection with this Agreement and the transactions
contemplated hereby.
Section 9. AMENDMENT; ASSIGNMENT. This Agreement may
not be modified, amended, altered or supplemented except upon the execution and
delivery of a written agreement executed by the parties hereto. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns and shall be assignable by the parties
hereto; PROVIDED, HOWEVER, that this Agreement shall not be assignable by any
Seller without the prior written consent of Parent other than to an affiliate
of Seller D that agrees to be bound by this Agreement. No assignment hereunder
will relieve any party to this Agreement of its obligations hereunder.
Section 10. PARTIES IN INTEREST. This Agreement shall be
binding upon and inure solely to the benefit of each party hereto and its
successors and permitted assigns, and nothing in this Agreement, express or
implied, is intended to or shall confer upon any other person any rights,
benefits or remedies of any nature whatsoever under or by reason of this
Agreement.
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Section 11. 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 given upon receipt) by delivery in
person, by facsimile or by registered or certified mail (postage prepaid,
return receipt requested), to the other party as follows:
(a) If to Parent or Acquisition, to:
Xxxxx Xxxxxxxx
Jacor Communications, Inc.
1300 PNC Center
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxx, Esq.
Xxxxxxx, Head & Xxxxxxx
1900 Fifth Third Center
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Facsimile: (000) 000-0000
and
---
Xxxxx X. Xxxxx, Esq.
Xxxxx, Xxxxx & Xxxxx
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
(b) If to the Sellers, to:
Xxxxx X. Xxxxxxx, Esq.
American Financial Group, Inc.
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxx 00000
Facsimile: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the other in writing in the manner set forth above.
Section 12. REASONABLE BEST EFFORTS. Subject to the
terms and conditions herein provided, each of the parties hereto agrees to use
its reasonable best efforts to take, or cause to be taken, all actions, and to
do, or cause to be done, all things reasonably necessary, proper or advisable
under applicable laws and
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regulations to consummate and make effective the transactions contemplated by
this Agreement.
Section 13. GOVERNING LAW. This Agreement shall be
governed by and construed in accordance with the law of the State of Florida,
without regard to the principles of conflicts of law thereof.
Section 14. TERMINATION.
(a) This Agreement shall terminate upon termination of
the Merger Agreement without the consummation of the Merger. No such
termination shall relieve any party from liability for any breach of this
Agreement.
(b) If (i) the Merger Agreement is terminated pursuant to
Sections 8.1(f), 8.1(g) or 8.1(h) of that Agreement and (ii) a transaction is
consummated within eighteen months after the termination of the Merger
Agreement that results (1) in the sale, exchange, conversion or other
disposition (by merger or otherwise) of some or all of the Shares owned by
Seller D or Seller F (2) a payment (by dividend or otherwise) to Seller D or
Seller F following a sale of all or substantially all of the assets of the
Company, a recapitalization, a restructuring or other similar event (in the
case of (1) or (2), an "Other Transaction"), Seller D and Seller F shall,
immediately after the consummation of the Other Transaction, pay to Parent a
sum (the "Compensating Payment") equal to the number of Shares sold, exchanged,
converted, or otherwise disposed or with respect to which Seller D or Seller F
received a payment, in the Other Transaction multiplied by one half of the Per
Share Difference. The Per Share Difference shall equal (x) the fair market
value, valued as of the time the Other Transaction is consummated, of the
consideration per Share received by Seller D or Seller F in the Other
Transaction less (y) the expected fair market value per Share, valued as of
December 1, 1996, that Seller D or Seller F would have received in the Merger.
If Seller D, Seller F and Parent cannot agree on the amount of the Compensating
Payment, Seller D and Seller F shall pay Parent immediately a sum equal to what
Seller D and Seller F believe the Compensating Payment to be (the "Immediate
Payment") plus interest at 9% per year on the Immediate Payment for the period
between the time the Other Transaction is consummated and the time the
Immediate Payment is made, and the final amount of the Compensating Payment
shall be determined in accordance with the commercial arbitration rules of the
American Arbitration Association by an arbitrator or arbitrators appointed in
accordance with such rules. Such arbitration shall take place in Cincinnati,
Ohio, and judgment upon any award rendered in such arbitration may be entered
in any court of appropriate jurisdiction; the parties hereto consent to the
entry of such judgment and agree that no appeal shall be taken therefrom.
Parent shall be entitled to receive immediately the difference between the
final amount of the Compensating Payment
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determined by the arbitrators and the Immediate Payment (the "Difference") and
interest at 9% per year on the Difference for the period between the date the
Competing Transaction is consummated and the date the Difference is paid to
Parent. In no event shall Parent be required to make any payment under this
Agreement.
(c) This Section 14 shall survive the termination of this
Agreement.
Section 15. SEVERABILITY. The provisions of this
Agreement shall be deemed severable and the invalidity or unenforceability of
any provision shall not affect the validity and enforceability of the other
provisions hereof. If any provision of this Agreement, or the application
thereof to any person or entity or any circumstance, is invalid or
unenforceable, (a) a suitable and equitable provision shall be substituted
therefor in order to carry out, so far as may be valid and enforceable, the
intent and purpose of such invalid and unenforceable provision and (b) the
remainder of this Agreement and the application of such provision to other
persons, entities or circumstances shall not be affected by such invalidity or
unenforceability, nor shall such invalidity or unenforceability affect the
validity or enforceability of such provision, or the application thereof, in
any other jurisdiction.
Section 16. ENTIRE AGREEMENT. This Agreement constitutes
the entire agreement among the parties hereto with respect to the subject
matter hereof and supersedes all other prior agreements and understandings,
both written and oral, among the parties with respect to the subject matter
hereof.
Section 17. DESCRIPTIVE HEADINGS. The descriptive
headings 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.
Section 18. CERTAIN DEFINITIONS. For purposes of this
Agreement, the term:
(a) "affiliate" of a person means a person that directly
or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with, the first mentioned person;
(b) "control" (including the terms "controlled by" and
"under common control with") means the possession, directly or indirectly or as
trustee or executor, of the power to direct or cause the direction of the
management policies of a person, whether through the ownership of stock, as
trustee or executor, by contract or credit arrangement or otherwise;
(c) "knowledge" means knowledge after reasonable inquiry;
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(d) "person" means an individual, corporation,
partnership, association, trust, unincorporated organization, other entity or
group (as defined in Section 13(d)(3) of the Exchange Act); and
(e) "subsidiary" or "subsidiaries" of any person means
any corporation, partnership, joint venture or other legal entity of which such
person (either alone or through or together with any other subsidiary), owns,
directly or indirectly, 50% or more of the stock or other equity interests the
holder of which is generally entitled to vote for the election of the board of
directors or other governing body of such corporation, partnership, joint
venture or other legal entity.
Section 19. COUNTERPARTS. This Agreement may be executed
in two or more counterparts, each of which shall be deemed to be an original,
but all of which shall constitute one and the same agreement.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to
be executed on its behalf by its representatives thereunto duly authorized, all
as of the day and year first above written.
GREAT AMERICAN INSURANCE COMPANY
By: __________________________
Name:
Title:
AMERICAN FINANCIAL CORPORATION
By: __________________________
Name:
Title:
AMERICAN FINANCIAL ENTERPRISES, INC.
By: __________________________
Name:
Title:
XXXX X. XXXXXXX
_________________________
Xxxx X. Xxxxxxx
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THE XXXX X. XXXXXXX FOUNDATION
By: __________________________
Name:
Title:
S. XXXXX XXXXXXX
__________________________
S. Xxxxx Xxxxxxx
JACOR COMMUNICATIONS, INC.
By: __________________________
Name:
Title:
JCAC, INC.
By: __________________________
Name:
Title:
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SCHEDULE A
TO THE
STOCKHOLDERS AGREEMENT
Capitalized terms used in this Schedule A and not otherwise defined in
this Schedule A have the respective meanings assigned to such terms in the
attached Stock Purchase Agreement.
NAME OF EACH SELLER NUMBER OF SHARES
------------------- ----------------
GREAT AMERICAN INSURANCE COMPANY 3,455,698 Shares
AMERICAN FINANCIAL CORPORATION 1,500,000 Shares
AMERICAN FINANCIAL ENTERPRISES, INC. 2,611,191 Shares
XXXX X. XXXXXXX 3,257,913 Shares
THE XXXX X. XXXXXXX FOUNDATION 170,253 Shares
S. XXXXX XXXXXXX 85,500 Shares
======================== =================
Total 11,080,555 Shares
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EXHIBIT A
WRITTEN CONSENT
OF A SHAREHOLDER OF
CITICASTERS, INC.
PURSUANT TO SECTION 607.0704
OF THE FLORIDA BUSINESS CORPORATION ACT
The undersigned, being the holder of ________ shares of Class A Common
Stock, par value $.01 per share, of Citicasters, Inc., a Florida corporation
(the "Company"), by executing this written consent, hereby approves the
Agreement and Plan of Merger (the "Merger Agreement") dated as of February 12,
1996 among the Company, Jacor Communications, Inc., an Ohio corporation
("Acquiror") and JCAC, Inc., a Florida corporation and wholly owned subsidiary
of Acquiror ("Acquisition") and thereby approves the adoption by the surviving
corporation in the merger contemplated by the Merger Agreement of the Articles
of Incorporation and By-Laws of Acquisition.
IN WITNESS WHEREOF, the undersigned has executed this written consent
as of the date written below.
Date:
______________
[Shareholder]
_______________________
[Shareholder]
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