Clear Channel Communications, Inc.
P.O. Box 659512
San Antonio, Texas 78265-9512
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
April 25, 1996
As a shareholder of Clear Channel Communications, Inc. (the
"Company"), you are hereby given notice of and invited to attend,
in person or by proxy, the Annual Meeting of Shareholders of the
Company to be held at 200 Concord Plaza (Conference Room-5th
Floor), San Antonio, Texas on April 25, 1996, at 11:00 a.m., for
the following purposes:
1. To elect directors for the coming year;
2. To select independent auditors for the year ending December
31, 1996;
3. To transact any other business which may properly come before
the meeting.
The Board of Directors (the "Board") has fixed the close of
business on March 1, 1996 as the record date for the
determination of shareholders entitled to notice of and to vote
at the meeting.
Your attention is invited to the accompanying Proxy Statement. In
addition, although mere attendance at the meeting will not revoke
the proxy, a shareholder present at the meeting may revoke his
proxy and vote in person. To assure that your shares are
represented at the meeting, please complete, date, sign and mail
the enclosed Proxy card in the return envelope provided for that
purpose.
By Order of the Board of Directors
Kenneth E. Wyker
Secretary
San Antonio, Texas
March 19, 1996
PROXY STATEMENT
Clear Channel Communications, Inc.
P.O. Box 659512
San Antonio, Texas 78265-9512
ANNUAL MEETING OF SHAREHOLDERS
April 25, 1996
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of Clear Channel
Communications, Inc. (the "Company") of proxies for use at the
Annual Meeting of Shareholders to be held on April 25, 1996, or
at any adjournment thereof, as set forth in the accompanying
notice. A shareholder giving a proxy may revoke it at any time
before it is exercised by so notifying the Secretary of the
Company in writing or in person. Any proxy which is not revoked
will be voted at the meeting. The Proxy Statement is first being
sent to shareholders on or about March 19, 1996.
On March 1, 1996, the record date for determination of
shareholders entitled to notice of and to vote at the meeting,
there were 34,592,012 shares of Common Stock outstanding. On all
matters, each share has one vote.
Votes cast by proxy or in person at the Annual Meeting will be
counted by the persons appointed by the Company to act as
election inspectors at the meeting. The election inspectors will
treat shares represented by proxies that reflect abstentions as
shares that are present and entitled to vote for purposes of
determining the presence of a quorum and for purposes of
determining the outcome of any matter submitted to the
shareholders for a vote. Abstentions, however, do not constitute
a vote "for" or "against" any matter and thus will be disregarded
in the calculation of a plurality or of "votes cast."
The election inspectors will treat shares referred to as "broker
non-votes" (i.e., shares held by brokers or nominees as to which
instructions have not been received from the beneficial owners or
persons entitled to vote that the broker or nominee does not have
discretionary power to vote on a particular matter) as shares
that are present and entitled to vote for purposes of determining
the presence of a quorum. However, for purposes of determining
the outcome of any matter as to which the broker has physically
indicated on the proxy that it does not have discretionary
authority to vote, those shares will be treated as not present
and not entitled to vote with respect to that matter (even though
those shares are considered entitled to vote for quorum purposes
and may be entitled to vote on other matters).
In the election of directors, shares present but not voting will
be disregarded (except for quorum purposes). The election of
directors requires an affirmative vote by a majority of the
outstanding shares present and entitled to vote at the meeting.
SECURITY OWNERSHIP
The table below sets forth certain information about the persons
and entities known to the Company to own beneficially more than
5% of the Company's outstanding stock. Such information is based
upon required notices previously filed with the Company. Such
shares are held in each shareholder's name or in a nominee
account.
Shares of
Common Stock
Beneficially Percent
Owned at of
Name February 15, 1996 Class
L. Lowry Mays 7,618,846(1) 22%
400 Geneseo Road
San Antonio, Texas 78209
B. J. McCombs 5,662,093(2) 16%
825 Contour
San Antonio, Texas 78212
Putnam Investments 2,520,408 7%
One Post Office Square
Boston, Massachusetts 02019
Pilgrim Baxter Associates 2,172,000 6%
1255 Drummers Lane #300
Wayne, Pennsylvania 19807-1590
(1) Includes presently exercisable options to acquire 338,595
shares and 56,660 shares held by trusts of which he is Trustee,
but not beneficiary.
(2) Includes presently exercisable nonqualified options to
acquire 14,375 shares.
ELECTION OF DIRECTORS AND DIRECTOR COMPENSATION
One of the purposes of the meeting is the election of directors.
The number of directors expected to constitute the entire board
following the election is five. Unless you indicate to the
contrary, the persons named in the accompanying proxy will vote
your shares for the election of the nominees named below as
directors. Although it is not envisioned that any nominee will
decline or be unable to serve, the proxies will be voted by the
proxy holders at their discretion for another person, or for a
lesser number of persons, if such a contingency should arise. The
term of each person elected as a director will continue until the
next annual meeting and until his successor is elected and
qualified. Outside directors are paid $5,000 for each meeting of
the Board they attend, plus members of the compensation committee
are paid $500 for each meeting of the compensation committee they
attend. In addition, in February 1993, each outside director was
granted options to purchase 15,624 shares of Common Stock of the
Company, 9,375 of which are exercisable as of the date of this
Proxy Statement. In February 1994, each outside director was
granted options to purchase 12,500 shares of Common Stock of the
Company, 5,000 of which are exercisable as of the date of this
Proxy Statement. The election of directors requires an
affirmative vote by a majority of the outstanding shares present
and entitled to vote at the meeting.
The table on the following page reflects the number of shares of
Common Stock beneficially owned by the directors of the Company
as of February 15, 1996, and the number of shares beneficially
owned by each of the named executive officers and the number of
shares beneficially owned by all directors and officers of the
Company as a group.
<TABLE>
<CAPTION>
Shares of
Principal Year First Common Stock
Occupation Became Beneficially Owned Percent
Name Age or Employment a Director at February 15, 1996 of Class
<S> <C> <C> <C> <C> <C>
L. Lowry Mays (a) (1) (4) (6) 60 President & Chief 1972 7,618,846 22%
400 Geneseo Road Executive Officer
San Antonio, Texas 78209 of the Company
Alan D. Feld (a) (2) (3) (4) 59 Partner of the law 1984 34,615 *
4235 Bordeaux firm Akin, Gump, Strauss,
Dallas, Texas 76205 Hauer & Feld, L.L.P.
B. J. McCombs (a) (3) (4) 68 Private Investor 1972 5,662,093 16%
825 Contour
San Antonio, Texas 78212
Theodore H. Strauss(b)(3)(4) 71 Sr. Managing Dir. 1984 59,139 *
5100 Park Lane Bear, Stearns & Co., Inc.
Dallas, Texas 75220
John H. Williams (a)(b)(3)(4) 62 Senior Vice Pres. 1984 20,511 *
7810 Glen Albens Circle Everen Securities, Inc.
Dallas, Texas 75225
Dave Ross 45 Vice President n/a 13,344 *
1975 E. Sunrise Blvd. Clear Channel Metroplex
Ft. Lauderdale, Florida 33304
W. Ripperton Riordan 39 Executive V.P./COO n/a 6,066 *
1701 Broadway Street NE Clear Channel Television
Minneapolis, Minnesota 55413
Jack Peck 39 Vice President n/a 3,816 *
2701 Union Ave. Clear Channel Television
Memphis, Tennessee 38104
Josh McGraw 45 Vice President n/a --- *
8675 Hogan Road Clear Channel Television
Jacksonville, Florida 32216
All officers and directors as a group (39 persons)(5) 14,005,568 40%
(a) Member of Compensation Committee
(b) Member of Audit Committee
* Percentage of shares beneficially owned by such persons does
not exceed one percent of the class so owned.
(1) Includes presently exercisable options to acquire 338,595
shares and 56,660 shares held by trusts of which he is Trustee,
but not beneficiary.
(2) Includes 16,240 shares of Common Stock owned by Mr. Feld's
wife, as to which he disclaims beneficial ownership.
(3) Includes presently exercisable nonqualified options to
acquire 14,375 shares.
(4) Nominee for Director
(5) Includes presently exercisable options to acquire 539,950
shares.
(6) Mark P. Mays, Senior Vice President-Operations, and Randall
T. Mays, Vice President-Treasurer, executive officers of the
Company, are the sons of L. Lowry Mays.
</TABLE>
Each of the nominees has held the position listed above, or a
similar position with the same organization, for at least five
years.
The nominees for directors of the Company serve as directors for
the following corporations, some of which have a class of
securities registered pursuant to Section 12 or Section 15 of the
Securities Exchange Act of 1934: Mr. Feld is a director of
Centerpoint Properties, Inc.; Mr. Strauss is a director of Sport
Supply Group, Inc., Sizeler Property, Inc. and Hollywood Casino;
Mr. Williams is a director of GAINSCO, Inc.
The Company's executive compensation program is administered by
the Compensation Committee of the Board which is composed of
three independent, non-employee directors and L. Lowry Mays, the
Chief Executive Officer ("CEO") of the Company. The Compensation
Committee (the "Committee"), which met once in 1995, recommends
to the Board compensation arrangements for all officers and
directors of the Company other than the CEO and for other key
personnel of its subsidiaries. Two of the independent, non-
employee directors --- John H. Williams and Alan D. Feld ---
serve as a separate subcommittee of the Committee which
determines the salary and incentive bonuses to be paid to the
CEO. Mr. Mays does not participate in this subcommittee's
evaluation and recommendation of the CEO's compensation. The
Committee annually evaluates the Company's corporate performance,
actual compensation and share ownership of the executive
officers, compared with both the Company's own industry and a
broader group of companies such as the S&P 500. Please see the
attached Board Compensation Committee Report which details the
basis on which the Committee determines executive compensation.
The Audit Committee of the Board, which met once in 1995, reviews
the independent auditors' examination report. There is no
Nominating Committee of the Board of Directors.
During 1995, the Board held five meetings. Each of the nominees
named above attended at least 75 % of the aggregate of the total
number of meetings of the Board and the total number of meetings
held by committees of the Board on which that director served.
Compensation Committee Interlocks and Insider Participation
During 1995, the members of the Committee, which included John H.
Williams, Alan D. Feld and B. J. McCombs, were primarily
responsible for determining executive compensation, including
decisions related to stock option grants to executive officers.
L. Lowry Mays, the Company's Chief Executive Officer, is also a
member of the Compensation Committee and participated in
deliberations concerning executive officer compensation other
than his own.
The Company paid fees in 1995 to the law firm of Akin, Gump,
Strauss, Hauer & Feld, L.L.P. Alan Feld, a director of the
Company, is the sole shareholder of a professional corporation
which is a partner of such firm. The Company purchased in 1995
various forms of insurance from Primera Insurance Company
("Primera"). B. J. McCombs, a director of the Company, owns 75%
of Primera. As part of its operations, the Company leases certain
office space in San Antonio, Texas from the trusts of the
children of L. Lowry Mays and B. J. McCombs. This lease expires
on December 31, 1997 with current monthly rentals of $16,486. The
Company believes all of the transactions described above are no
less favorable to the Company than could be obtained with
nonaffiliated parties.
EXECUTIVE COMPENSATION
The Company believes that compensation of its executive officers
and others should be directly and materially linked to operating
performance. For Fiscal Year 1995, the executive compensation
program consisted of the base salary, a bonus plan based on
Company profitability and individual performance and stock
options that generally become exercisable over a five year
period. Mr. Mays, the Company's CEO, has an employment contract
with the Company expiring February 1, 1999, providing for a base
salary of $600,000 per year and a bonus as may be determined by
the Compensation Committee and approved by the Board of
Directors. Mr. Mays was awarded a bonus for services rendered in
1995 of $1,500,000, which was paid in 1996. The compensation
levels of the remaining four executives were based primarily on
the achievement of specific quantitative and qualitative goals
set at the beginning of the period.
SUMMARY COMPENSATION TABLE
The following table sets forth the compensation earned or paid by
the Company to the CEO and each of its other four highest
compensated executive officers whose total cash compensation
exceeded $100,000 for services rendered in all capacities for the
years ended December 31, 1995, 1994 and 1993.
<TABLE>
<CAPTION>
Annual Compensation Long-term Compensation
Other All
Annual Restricted Other
Compen- Stock Options/ LTIP Compen-
Salary Bonus sation Awards SARs Payout sation
Name/Title Year ($) ($) ($) ($) (#) ($) ($)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
L. Lowry Mays 1995 598,217 1,500,000 --- --- --- --- 154,890(1)
President 1994 577,396 1,000,000 --- --- 125,000 --- 202,282(1)
and CEO 1993 351,153 650,000 --- --- 125,000 --- 146,573(1)
Rip Riordan 1995 171,541 123,523 --- --- 5,000 --- 2,844(2)
Exec. VP/COO 1994 157,845 45,000 --- --- 2,500 --- 2,762(2)
Clear Channel 1993 128,615 27,500 --- --- --- --- 2,251(2)
Television
Dave Ross 1995 159,558 100,000 --- --- --- --- 2,771(2)
Vice President 1994 33,130 --- --- --- 3,000 --- ---
Clear Channel 1993 --- --- --- --- --- --- ---
Metroplex
Jack Peck 1995 132,149 98,283 --- --- --- --- 2,308(2)
Vice President 1994 132,174 50,000 --- --- 2,500 --- 2,308(2)
Clear Channel 1993 117,295 35,000 --- --- --- --- 2,053(2)
Josh McGraw 1995 122,149 68,951 --- --- --- --- ---
Vice President 1994 121,767 45,000 --- --- 2,500 --- ---
Clear Channel 1993 117,184 30,000 --- --- --- --- ---
Television
(1) Represents $151,656, $199,048, and $143,425 paid by the
Company in 1995, 1994, and 1993, respectively, on a split-dollar
life insurance policy for Mr. Mays. Such amounts include the
entire dollar amount of the term life portion and the present
value to Mr. Mays of the interest-free use of the non-term
portion of each premium payment. The remainder represents the
amount of matching contributions paid by the Company under the
401(k) plan.
(2) Represents the amount of 401(k) matching contributions paid
by the Company.
</TABLE>
OPTIONS GRANTED DURING THE 1995 FISCAL YEAR
The following table discloses, for the CEO and other named
executives, information on options on the Company's Common Stock
("Options") granted to these executives during the 1995 Fiscal
Year.
<TABLE>
<CAPTION>
Option/SAR Grants Table
Individual Grants Option Value
% of Potential Realizable Value at
Total Assumed Annual Rates of Stock
Options/ Price Appreciation for
Options SARs Option Term
SARs Granted to Exercise or
Granted Employees in Base Price Expiration 5% 10%
Name/Title (#) Fiscal Year ($/share) Date ($) ($)
<S> <C> <C> <C> <C> <C> <C>
L. Lowry Mays --- --- --- n/a --- ---
President
and CEO
W. Ripperton
Riordan 5,000 6% 39.63 20-Nov-02 80,667 187,988
Exec. VP/COO
Clear Channel
Television
Dave Ross --- --- --- n/a --- ---
Vice President
Clear Channel
Metroplex
Jack Peck --- --- --- n/a --- ---
Vice President
Clear Channel
Television
Josh McGraw --- --- --- n/a --- ---
Vice President
Clear Channel
Television
</TABLE>
OPTIONS EXERCISED DURING THE 1995 FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES
The following table discloses, for the CEO and other named
executives, individual exercises of Options in the last fiscal
year and the number and value of Options held by such named
executive at December 31, 1995.
<TABLE>
<CAPTION>
Option/SAR Exercises
and year-end Value Table
Value of
Number of Unexercised
Unexercised In-The-Money
Option/SARs Option/SARs
Shares at FY-End (#) at FY-End ($)
Acquired Value
on Exercise Realized Non Non
Name/Title (#) ($) Vested Vested Vested Vested
<S> <C> <C> <C> <C> <C> <C>
L. Lowry Mays ------ ------ 297,837 10,758 9,908,344 374,690
President
and CEO
W. Ripperton Riordan ------ ------ ------ 7,500 --- 92,413
Exec. VP/COO
Clear Channel Television
Dave Ross ------ ------ ------ 3,000 --- 60,375
Vice President
Clear Channel Metroplex
Jack Peck ------ ------ ------ 2,500 --- 69,938
Vice President
Clear Channel Television
Josh McGraw ------ ------ ------ 2,500 --- 69,938
Vice President
Clear Channel Television
</TABLE>
STOCK PERFORMANCE CHART
The following chart demonstrates a five year comparison of the
cumulative total returns, adjusted for stock splits and
dividends, for the Company, the Paul Kagan Associates, Inc.
Broadcasting Average, and the S&P 500 Composite Index.
Clear Channel Communications Stock Performance Chart
Indexed Yearly Stock Price Close
(Prices Adjusted for Stock Splits and Dividends)
S&P 500 Paul Kagan Clear Channel
1990 1.0 1.0 1.0
1991 1.3 .9 1.3
1992 1.3 1.2 2.4
1993 1.4 1.6 6.8
1994 1.4 1.7 9.3
1995 1.9 2.4 16.2
RETIREMENT PLAN
On March 1, 1987, the Company adopted the Clear Channel
Communications, Inc. 401(k) Savings Plan for the purpose of
providing retirement benefits for substantially all employees.
Employees eligible for this plan may defer as much as 10% of
their compensation per year, up to $9,240, for which the Company
contributes 35% of the first 5% of the employee's deferred
compensation. Company matched contributions vest to the employees
based on their number of years of service to the Company.
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Company's officers
and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file
reports of ownership and changes in ownership with the SEC and
the New York Stock Exchange. Officers, directors and greater than
ten percent stockholders are required by SEC regulation to
furnish the Company with copies of all Section 16(a) forms they
file.
Based solely on its review of the copies of such forms received
by it, or written representations from certain reporting persons
that no Form 5 disclosing delinquently reported transactions were
required for those persons, the Company believes that, during the
year ended December 31, 1995, all filing requirements applicable
to its officers and directors were complied with, except for the
filing of the Initial Statements of Beneficial Ownership for Dave
Ross, Josh McGraw and Jack Peck, which were filed late.
SELECTION OF INDEPENDENT AUDITORS
Independent auditors are to be selected at the meeting, and
unless indicated to the contrary on the proxy, the persons named
in the accompanying proxy will vote for Ernst & Young LLP,
Certified Public Accountants, who have served as auditors of the
Company for the most recent fiscal year. Representatives of Ernst
& Young LLP are expected to be present at the meeting to respond
to appropriate questions and will have an opportunity to make a
statement if they so desire. The Annual Report to Shareholders of
the Company, including financial statements for fiscal year ended
December 31, 1995, has preceded or accompanies this proxy
statement. The Annual Report to Shareholders is not to be deemed
part of this proxy statement.
CERTAIN TRANSACTIONS
The Company paid fees in 1995 to the law firm of Akin, Gump,
Strauss, Hauer & Feld, L.L.P. Alan Feld, a director of the
Company, is the sole shareholder of a professional corporation
which is a partner of such firm. The Company purchased in 1995
various forms of insurance from Primera. B. J. McCombs, a
director of the Company, owns 75% of Primera. As part of its
operations, the Company leases certain office space in San
Antonio, Texas from the trusts of the children of L. Lowry Mays
and B. J. McCombs. This lease expires on December 31, 1997 with
current monthly rentals of $16,486. The Company believes all of
the transactions described above are no less favorable to the
Company than could be obtained with nonaffiliated parties.
The Company's wholly-owned subsidiary, Clear Channel Television,
Inc. ("CCTV"), adopted its 1991 Non-Qualified Stock Option Plan
(the "CCTV Non-Qualified Stock Option Plan"), providing for the
grant to eligible CCTV employees of options to purchase up to
50,000 shares of CCTV Common Stock. The CCTV Non-Qualified Stock
Option Plan is currently administered by the Stock Option
Committee of the Board of Directors of CCTV. In February 1993,
CCTV elected to discontinue the granting of options pursuant to
this plan. Under the terms of the CCTV Non-Qualified Stock Option
Plan, the CCTV Stock Option Committee is authorized to determine
the date upon which options granted thereunder become
exercisable, the exercise price of such options and other terms
and conditions thereof. At December 31, 1995, options to purchase
9,500 shares of CCTV Common Stock had been granted and were
outstanding under the CCTV Non-Qualified Stock Option Plan. The
exercise price of such options is $1.00 per share. Pursuant to
the CCTV Non-Qualified Stock Option Plan, each participant
therein will be required to enter into a Buy-Sell Agreement with
CCTV with respect to the shares of CCTV Common Stock acquired by
such participant upon the exercise of any options granted
thereunder. Executive officers hold all such options; however,
none are vested.
In May 1977, the Company and its shareholders, including L. Lowry
Mays and B.J. McCombs, entered into a Buy-Sell Agreement (the
"Repurchase Agreement") restricting the disposition of the
outstanding shares of Common Stock owned by L. Lowry Mays and
B.J. McCombs and their heirs, legal representatives, successors
and assigns (collectively, the "Restricted Parties"). The
Repurchase Agreement provides that in the event that a Restricted
Party desires to dispose of his shares, other than by disposition
by will or intestacy or through gifts to such Restricted Party's
spouse or children, such shares must by offered for a period of
30 days to the Company. Any shares not purchased by the Company
must then be offered for a period of 30 days to the other
Restricted Parties. If all of the offered shares are not
purchased by the Company or the other Restricted Parties, the
Restricted Party offering his shares may sell them to a third
party during a period of 90 days thereafter at a price and on
terms not more favorable than those offered to the Company and
the other Restricted Parties. In addition, a Restricted Party may
not individually, or in concert with others, sell any shares so
as to deliver voting control to a third party without providing
in any such sale that all Restricted Parties will be offered the
same price and terms for their shares.
SHAREHOLDER PROPOSALS
A proper proposal submitted by a Company shareholder for
consideration at the Company's 1997 Annual Meeting of
Shareholders and received at the Company's executive offices no
later than November 30, 1996 will be included in the Company's
Proxy Statement and form of Proxy relating to such Annual
Meeting. If the proposal is adopted, it will be included in the
information statements distributed to shareholders.
GENERAL
Neither management nor the Board of Directors knows of any matter
to be acted upon at the meeting other than the matters described
above. If any other matter properly comes before the meeting,
however, the proxy holders will vote thereon in accordance with
their best judgment.
The cost of soliciting proxies will be borne by the Company.
Following the original mailing of the proxy soliciting material,
regular employees of the Company may solicit proxies by mail,
telephone, telegraph and personal interview. Proxy cards and
materials will also be distributed to beneficial owners of stock,
through brokers, custodians, nominees and other like parties, and
the Company expects to reimburse such parties for their charges
and expenses connected therewith.
A copy of the Company's Annual Report on Form 10-K filed with the
Securities and Exchange Commission will be available when filed
without charge to shareholders upon written request to Clear
Channel Communications, P.O. Box 659512, San Antonio, Texas 78265-
9512.
Kenneth E. Wyker
Secretary
BOARD COMPENSATION COMMITTEE REPORT
The Compensation Committee consists of three outside Board
members and the Chief Executive Officer ("CEO").
Overall Policy
The financial success of the Company is linked to the ability of
its executive officers and managers to direct the Company's
current operations and to assess the advantages of potential
acquisitions and realign the operations of the acquired entities
with the operating policies of the Company. A major objective of
the Company's compensation strategy is to attract and retain top
quality executives and operating managers. Another objective of
the Company's compensation strategy is to reward managers based
on the financial performance of operations under their control.
Financial incentives are used to motivate those responsible to
achieve the Company's financial goals and to align the interests
of the Company's managers with the interests of the Company's
shareholders.
In order to achieve the foregoing objectives, the Company's
compensation includes both a base salary component and incentive
compensation. Incentive compensation includes both annual bonuses
and stock options.
Compensation
Base salaries of executive officers are set with respect to
comparable salaries paid by the radio and television broadcast
industry in those markets in which the Company operates. The
salaries of all executive officers except the CEO are determined
through mutual negotiations between the executive and the CEO and
are based on both past performance and expected future
performance. The performance bonuses for 1995 for the executive
officers of Clear Channel Television, Inc. ("CCTV") were based
solely upon the executives achieving an increase in cash flow
over the prior year. The performance bonuses of all other
executive officers were based on a subjective evaluation of
whether the executive achieved budgeted goals. Budgeted goals are
set for each such executive officer pursuant to an extensive
annual operating plan established by the Company and the CEO.
Past and expected future performance was considered on a
subjective basis in determining these budgeted goals, based on
the varied circumstances impacting each operating division.
Similarly, in determining option grants (including option grants
to executive officers of CCTV), the sole factor weighed was
success in achieving budgeted goals as determined on a subjective
basis after consideration of the varied circumstances impacting
each operating division. The CEO reports to the Compensation
Committee as to the compensation levels and performance goals
which he sets for the Company's executive officers.
CEO Compensation
Two members of the Compensation Committee, John H. Williams and
Alan D. Feld, serve on the Performance-Based Compensation
Committee, a subcommittee of the Compensation Committee (the
"Subcommittee"). John H. Williams and Alan D. Feld are both
"outside directors" within the meaning of Section 162(m) of the
Internal Revenue Code. The Subcommittee establishes the CEO's
performance goals and determines the amount of incentive bonus.
In 1995, the CEO's annual salary was $600,000 pursuant to his
employment contract with the Company. He was paid a cash bonus of
$1,500,000 in February of 1996 that, while paid in 1996, rewarded
the CEO for performance in 1995. No options were granted to the
CEO in 1995 for the purchase of shares of the Company's Common
Stock.
The Subcommittee utilized information gathered from its review of
compensation packages of ten comparable companies in the radio
and television broadcasting industry in determining the CEO's
base salary and overall compensation package. The amount of
salary paid and bonus awarded was judged to be deserving and
balanced for the value received by the shareholders from the
CEO's efforts, based on the overall increase in the Company's
after-tax cash flow and the increase in market value of the
Company's Common Stock from year to year.
In evaluating the incentive bonus compensation to be awarded to
the Company's CEO, the Subcommittee reviewed the financial
performance of the Company over the 1995 fiscal year. Based on
the performance goals established by the Subcommittee under the
Performance-Based Compensation Plan adopted by the shareholders
at the 1995 Annual Meeting, the CEO was entitled to an incentive
bonus of up to 20% of the increase in the after-tax cash flow
from the 1994 fiscal year to the 1995 fiscal year. In 1995, after
tax cash flow increased from $47 million to $71 million, or 52%.
The Subcommittee determined that it was in the best interest of
the Company to award the CEO an incentive bonus of $1,500,000 for
1995 under the Performance-Based Compensation Plan.
The Subcommittee also noted the market value of the Company's
outstanding Common Stock at December 31, 1995 was $1.5 billion, a
74% increase over the market value at December 31, 1994, while
the number of shares outstanding increased by less than one
percent. Total assets grew by 37% to $563 million in 1995 mainly
through acquisitions, while total shareholders equity at December
31, 1995 to support that asset base grew to $164 million, a 25%
increase. Many factors contributed to this exceptional
performance, but paramount was the financial and management
skills employed by the CEO and the management group he put in
place.
As mentioned above, the Subcommittee gathered competitive
compensation data on ten radio and television broadcasting
companies. The companies were selected by the Subcommittee as the
most comparable to the Company in terms of the properties
operated and the markets served. The Subcommittee determined that
these ten companies provided more accurate compensation
information relative to the radio and television broadcasting
industry than the entire range of companies covered in the Paul
Kagan Associates, Inc. Broadcast Index used in the Stock
Performance Chart on page 9. Although the companies covered in
this index own radio and/or television properties, many of these
companies also own and/or operate businesses in such industries
as radio and television networks, newspaper and magazine
publishing, film production, financial services and
manufacturing. In the Subcommittee's opinion, the CEO's 1995
compensation corresponded to the median to high end of the range
paid by the ten companies surveyed.
Policy on Deductibility of Compensation
Section 162(m) of the Internal Revenue Code limits the tax
deduction for compensation paid to the named executive officers
to $1 million. However, performance-based compensation that has
been approved by shareholders is excluded from the $1 million
limit if, among other requirements, the compensation is payable
only upon attainment of pre-established, objective performance
goals and the board committee that establishes such goals
consists only of "outside directors" (as defined for purposes of
Section 162 (m)).
At the 1995 Annual Meeting, the shareholders approved the
Performance-Based Compensation Plan, which meets the requirements
of Section 162(m) with respect to the performance-based
compensation paid to the CEO, as discussed above. The Committee's
present intention is to continue to comply with the requirements
of Section 162(m).
COMPENSATION COMMITTEE
John Williams
Alan D. Feld
B. J. McCombs
L. Lowry Mays
CLEAR CHANNEL COMMUNICATIONS, INC.
Proxy Solicited on Behalf of the Board of Directors for the Annual Meeting
of Shareholders to be held April 25, 1996
The undersigned hereby appoints L. Lowry Mays and Alan D. Feld and each of
them, proxies of the undersigned with full power of substitution for and in
the name, place and stead of the undersigned to appear and act for and to vote
all shares of CLEAR CHANNEL COMMUNICATIONS, INC. standing in the name of
the undersigned or with respect to which the undersigned is entitled to vote
and act at the Annual Meeting of Shareholders of said Company to be held in
San Antonio, Texas on April 25, 1996 at 11:00 A.M., CST, or at any adjournments
or postponements thereof, with all powers the undersigned would possess of then
personally present, as indicated on the reverse side.
The undersigned acknowledges receipt of notice of said meeting and accompanying
Proxy Statement and of the 1995 Annual Report and ratifies and confirms all acts
that any of the said proxy holders or their substitutes may lawfully do or
cause to be done by virtue hereof.
(Continued and to be dated and signed on the reverse side.)
1. Election of Directors FOR all five nominees listed below [ ]
WITHHOLD AUTHORITY to vote for all five nominees below [ ] EXCEPTIONS* [ ]
INSTRUCTIONS: To withhold authority to vote for any individual nominee(s) mark
the "EXCEPTIONS" box and strike a line through the name(s) of such nominee(s)
listed below:
L. Lowry Mays Alan D. Feld B.J. McCombs Theodore H. Strauss
John H. Williams
2. Selection of Ernst & Young LLP as independent auditors for the year ended
December 31, 1996.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment(s)
thereof.
Change of Address and/or Comments: [ ]
Please sign your name exactly as it appears hereon. Joint owners should sign
personally. Attorney, Executor, Administrator, Trustee or Guardian should
indicate full title.
CLEAR CHANNEL COMMUNICATIONS, INC.
P.O. BOX 11181
NEW YORK, N.Y. 10203-0181
Dated:____________________________________, 1996
___________________________
Shareholder's signature
_____________________________________________
Shareholder's signature if stock held jointly
Sign, Date, and Return the Proxy Card Promptly Using the Enclosed Envelope.
Votes MUST be indicated (X) in Black or Blue Ink. [X]
