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Filed by SFX Entertainment, Inc.
Pursuant to Rule 425 under the Securities Act of 1933 and deemed filed
pursuant to Rule 14a-12 of the Securities Exchange Act of 1934
Subject Company: SFX Entertainment, Inc.
Commission File No. 1-9645
On May 16, 2000, SFX Entertainment, Inc. issued the following press release
related to the merger between SFX Entertainment, Inc. and Clear Channel
Communications, Inc.:
SFX FILES PROXY STATEMENT FOR MERGER WITH CLEAR CHANNEL COMMUNICATIONS;
ANNOUNCES SETTLEMENT OF SHAREHOLDER LAWSUITS
SFX Entertainment, Inc. (NYSE:SFX) announced that on May 12, 2000 it had filed a
preliminary proxy statement with the Securities and Exchange Commission relating
to its proposed merger with a subsidiary of Clear Channel Communications, Inc.
(NYSE: CCU). In the filing, SFX disclosed that it had entered into a memorandum
of understanding with counsel for the plaintiffs in the lawsuits filed in the
Chancery Court of Delaware against SFX, its directors and Clear Channel
Communications by holders of SFX's Class A common stock. With the filing of the
preliminary proxy statement, the settlement of the shareholder litigation, and
the previously announced early termination of the statutory waiting period under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, all major
obstacles to the pending merger have been cleared. Assuming approval of the
transaction by SFX's stockholders, the merger is expected to be consummated
early in the third quarter of 2000.
The Delaware Chancery Court had previously consolidated the shareholder lawsuits
and appointed joint counsel to represent all plaintiffs. The memorandum of
understanding was agreed to following extensive discussion and negotiation with
joint counsel for the plaintiffs, as well as detailed disclosure by SFX and
Clear Channel as to the background and terms of the proposed merger, which are
described in the preliminary proxy statement. The settlement agreement, which is
subject to customary conditions, including court approval, will provide for a
complete release of all claims under state and federal law against the
defendants which have been or could have been asserted relating to the
transaction.
Under the terms of the merger agreement, entered into on February 28, 2000, SFX
Class A shareholders will receive 0.6 shares of Clear Channel common stock for
each SFX share, and SFX Class B shareholders will receive one share of Clear
Channel common stock for each SFX share, on a fixed exchange basis. Under the
settlement, there will be paid to the holders of the SFX Class A common stock an
additional $34.5 million, less the amount of fees and expenses awarded to the
plaintiffs' counsel by the court. Amounts payable pursuant to the proposed
settlement may be paid either in cash or Clear Channel common stock.
Clear Channel Communications, Inc. is a global leader in the out-of-home
advertising industry with radio and television stations and outdoor displays in
32 countries around the world. Including announced transactions, Clear Channel
operates 867 radio and 19 television stations in the United States reaching over
120 million people weekly. Through its wholly owned subsidiary Premiere Radio
Networks, Clear Channel reaches 40 million people weekly on 7,800 affiliates.
Additionally, Clear Channel has equity interests in over 240 radio stations
internationally. Clear Channel also operates more than 550,000 outdoor
advertising displays.
SFX Entertainment is the world's largest diversified promoter, producer and
presenter of live entertainment events. SFX currently owns and/or operates 120
live entertainment venues in 31 of the top 50 US markets, including 16
amphitheaters in the top 10 markets. In 1999, more than 60 million people
attended approximately 26,000 events promoted and/or produced by SFX, including
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more than 7,000 music concerts, 13,300 theatrical shows, 1,400 family
entertainment shows and 520 specialized sports shows.
SFX produces and promotes live music events, as well as develops and manages
touring Broadway shows in 55 markets. SFX is also a leading fully integrated
sports marketing and management company specializing in the representation of
athletes and broadcasters, integrated event management, television
programming/production and marketing consulting services in sports, news and
other entertainment industries. Additionally, SFX Sports produces and promotes
specialized motor sports events.
Forward-Looking Information
This news release contains certain "forward-looking statements," within the
meaning of the Private Securities Litigation Reform Act of 1995. The
forward-looking statements herein include statements about the merger agreement
between SFX Entertainment, Inc. and Clear Channel Communications, Inc. These
statements are based on management's current expectations and are subject to
uncertainty and changes in circumstances. Actual results may vary materially
from the expectations contained herein. Forward-looking statements can be
identified by the fact that they do not relate strictly to historical or current
facts. They often include words like "believe," "expect," "anticipate,"
"estimated," "pro forma," and "intend" or future or conditional verbs such as
"will," "would," or "may." The following factors, among others, could cause
SFX's actual results to differ materially from expected results: cost related to
or delays in completing the proposed transaction; failure of the stockholders of
SFX Entertainment, Inc. to approve the proposed transaction; the inability to
obtain, or meet conditions imposed for, governmental or other approvals for the
proposed transaction; difficulties in integrating the operations of SFX
Entertainment, Inc. with those of Clear Channel Communications, Inc.; and
changes in general, business, competitive and/or regulatory economic conditions
that may adversely affect the businesses in which SFX Entertainment, Inc. and
Clear Channel Communications, Inc. are engaged and changes in the securities
markets. More detailed information about those factors are set forth in filings
by SFX Entertainment, Inc. and Clear Channel Communications, Inc. with the
Securities and Exchange Commission, including the most recent quarterly report
on Form 10-Q and current reports on Form 8-K. SFX Entertainment, Inc. is not
under any obligation to (and expressly disclaims any such obligation to) update
or alter its forward- looking statements whether as a result of new information,
future events or otherwise.
Additional Information
SFX Entertainment, Inc. has filed a preliminary proxy statement, and SFX and
Clear Channel Communications, Inc. plan to file a definitive prospectus/proxy
statement and other relevant documents concerning the proposed transaction with
the Securities and Exchange Commission. We urge investors to carefully read the
definitive prospectus/proxy statement, and any other relevant documents filed
with the SEC, because they will contain important information. The
prospectus/proxy statement will be sent to stockholders of SFX Entertainment,
Inc. seeking their approval of the proposed transaction. Investors may obtain
free of charge a copy of the definitive prospectus/proxy statement (when it is
available) and other documents filed by SFX Entertainment, Inc. or Clear Channel
Communications, Inc. with the SEC at the SEC's website, www.sec.gov. In
addition, documents filed with the SEC by Clear Channel Communications, Inc.
will be available
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free of charge upon written request to Clear Channel Communications, P.O. Box
659512, San Antonio, Texas 78265-9512. Documents filed with the SEC by SFX
Entertainment, Inc. will be available free of charge from SFX Entertainment,
Inc. 650 Madison Avenue, 16th Floor New York, New York 10022, Attn: Thomas P.
Benson or call us at (212) 838-3100.
SFX Entertainment, Inc. and its directors, executive officers and certain other
members of SFX Entertainment, Inc. management and employees may be soliciting
proxies from stockholders of SFX Entertainment, Inc. in favor of the proposed
transaction. Information concerning the participants in the proxy solicitation
will be set forth in the definitive prospectus/proxy statement when it is filed
with the SEC.
