SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(RULE 13D-101)
Under the Securities Exchange Act of 1934
(AMENDMENT NO. __)
METRO NETWORKS, INC.
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(Name of Issuer)
COMMON STOCK, PAR VALUE $.001 PER SHARE
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(Title of Class of Securities)
591918 10 7
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(CUSIP Number)
WESTWOOD ONE, INC.
9540 WASHINGTON BLVD.
CULVER CITY, CA 90232
ATTENTION: MR. GARY J. YUSKO
(310) 840-4303
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(Name, address and telephone number of person
authorized to receive notices and communications)
JUNE 1, 1999
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(Date of event which requires filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), (f) or (g), check the following box.
C:\DATA\EDGAR\#569529 v2.rtf
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1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (entities only)
WESTWOOD ONE, INC.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
00
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
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7 SOLE VOTING POWER
NUMBER OF
SHARES 0
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
- --------- ----------------------------------------------------------------------
8 SHARED VOTING POWER
10,166,360**
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9 SOLE DISPOSITIVE POWER
0
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10 SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
10,166,360**
- --------- ----------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11
EXCLUDES CERTAIN SHARES [ ]
- --------- ----------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11
52.7%**
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14 TYPE OF REPORTING PERSON
CO
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** INCLUDES 2,549,750 SHARES OF METRO NETWORK, INC.'S COMMON STOCK
ISSUABLE UPON CONVERSION OF THE 2,549,750 OUTSTANDING SHARES OF METRO
NETWORKS, INC.'S SERIES A CONVERTIBLE PREFERRED STOCK.
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ITEM 1. SECURITY AND ISSUER
This Statement on Schedule 13D relates to the common stock,
par value $.001 per share (the "Common Stock"), of the Metro Networks, Inc., a
Delaware corporation (the "Company"). The address of the principal executive
offices of the Company is 2800 Post Oak Blvd., Suite 4000, Houston, Texas
77056-6199.
ITEM 2. IDENTITY AND BACKGROUND
(a),(b),(c) and (f). This Statement on Schedule 13D is filed
on behalf of Westwood One, Inc., a Delaware corporation ("Westwood"). Westwood
is a leading producer and distributor of nationally sponsored radio programs and
the largest radio network in the United States. Westwood also owns and operates
Westwood One Broadcasting Services, Inc., which provides local traffic, news,
sports and weather programming to radio stations and other media outlets in
sixteen cities, including New York, Los Angeles, Philadelphia and Chicago. The
business address of Westwood, which also serves as its principal office, is 9540
Washington Boulevard, Culver City, California 90232. The name, business address,
present principal occupation or employment and citizenship of each director and
executive office of Westwood is set forth on Appendix I hereto and incorporated
herein by reference.
(d) During the last five years, neither Westwood nor, to
Westwood's knowledge, any of the directors or executive officers identified on
Appendix I hereto has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
(e) During the last five years, neither Westwood nor, to
Westwood's knowledge, any of the directors or executive officers identified on
Appendix I hereto has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgement, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violations with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
In order to induce Westwood to enter into an Agreement and
Plan of Merger (the "Merger Agreement"), dated as of June 1, 1999, among
Westwood, Copter Acquisition Corp., a Delaware corporation and wholly-owned
subsidiary of Westwood ("Merger Sub"), and the Company, David I. Saperstein,
Charles I. Bortnick and Shane E. Coppola (referred to herein collectively as the
"Company Stockholders"), each of whom is a director and an executive officer of
the Company, entered into a Company Stockholder Voting Agreement, dated as of
June 1, 1999 (the "Company Stockholder Voting Agreement"), with Westwood. The
Company Stockholder Voting Agreement relates solely to the vote of the Company
Stockholders' shares of the Company's voting capital stock on the adoption and
approval of the Merger Agreement at the special meeting of the Company's
stockholders to be held for the purpose of considering such adoption and
approval. The Company Stockholders entered into the Company Stockholder Voting
Agreement as a condition to, and in consideration for, Westwood entering into
the Merger Agreement.
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In connection with the execution of the Merger Agreement and
the Company Stockholder Voting Agreement, Westwood also entered into a
Consulting Agreement dated as of June 1, 1999 with Mr. Saperstein (the
"Saperstein Consulting Agreement"), an Employment Agreement dated as of June 1,
1999 with Mr. Bortnick (the "Bortnick Employment Agreement") and an Employment
Agreement dated as of June 1, 1999 with Mr. Coppola (the "Coppola Employment
Agreement"). Each of the Saperstein Consulting Agreement, the Bortnick
Employment Agreement and the Coppola Employment Agreement will, pursuant to its
terms, become effective only upon consummation of the Merger. The foregoing
descriptions of the Saperstein Consulting Agreement, the Bortnick Employment
Agreement and the Coppola Employment Agreement do not purport to be complete and
are qualified in their entirety by reference to such agreements, a copy of each
of which has been filed as an exhibit hereto and is incorporated herein by
reference.
ITEM 4. PURPOSE OF TRANSACTION
Westwood entered into the Company Stockholder Voting Agreement
for the purpose of facilitating the adoption and approval of the Merger
Agreement by the Company's stockholders. Pursuant to the Company Stockholders
Voting Agreement, each Company Stockholder agreed with Westwood that for an
established period of time, such Company Stockholder would, among other things,
vote or cause to be voted all shares of voting capital stock of the Company
beneficially owned by such Company Stockholder or its wholly owned affiliates in
favor of the adoption and approval of the Merger Agreement. In addition, each
Company Stockholder agreed to appoint representatives of Westwood as proxies to
vote all voting capital stock of the Company beneficially owned by such Company
Stockholder or its wholly owned affiliates in favor of the adoption and approval
of the Merger Agreement.
Pursuant to the terms of the Merger Agreement, Merger Sub will
be merged with and into the Company, with the Company continuing as the
surviving corporation and a wholly owned subsidiary of Westwood. Upon
consummation of the Merger, the separate corporate existence of Copter
Acquisition Corp. will cease and the existing stockholders of the Company will
become stockholders of Westwood in accordance with the terms of the Merger
Agreement.
At the effective time of the Merger, each outstanding share of
Common Stock will be converted into the right to receive 1.5 shares of common
stock, par value $.01 per share, of Westwood ("Westwood Common Stock") and each
outstanding share of Series A Convertible Preferred Stock, par value $.001 per
share, of the Company ("Series A Preferred Stock") will be converted into the
right to receive 1.5 shares of a corresponding series of preferred stock of
Westwood.
The consummation of the Merger is subject to the adoption and
approval of the Merger Agreement by the Company's stockholders and the approval
of the issuance of Westwood Common Stock in the Merger by Westwood's
stockholders. The Merger also is subject to, among other conditions, the receipt
of all necessary regulatory approvals, including approvals pursuant to the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.
The foregoing descriptions of the Merger Agreement and the
Company Stockholder Voting Agreement do not purport to be complete and are
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qualified in their entirety by reference to such agreements, a copy of each of
which has been filed as an exhibit hereto and is incorporated herein by
reference.
Except as set forth in this Item 4, Westwood has no present
plans or proposals that relate to or that would result in any of the actions
specified in clauses (a) through (j) of Item 4 of Schedule 13D of the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
ITEM 5. INTEREST IN SECURITIES OF ISSUER
(a) Westwood beneficially owns, within the meaning of Rule
13d-3 under the Exchange Act, 10,166,360 shares of Common Stock. Such amount
includes (1) 7,615,610 shares of Common Stock of which Mr. Saperstein is the
record owner, (2) 2,549,750 shares of Common Stock issuable upon conversion of
2,549,750 shares of the Series A Preferred Stock of which Mr. Saperstein is the
record owner and (3) 1,000 shares of Common Stock of which Mr. Coppola is the
record owner, but of which, in each case, Westwood may be deemed to be the
beneficial owner as a result of the Company Stockholder Voting Agreement. Based
on the Company's representation to Westwood in the Merger Agreement that as of
May 31, 1999 there were 16,730,969 shares of Common Stock outstanding and
2,549,750 shares of Common Stock issuable upon conversion of 2,549,750
outstanding shares of Preferred Stock, Westwood beneficially owns 52.7% of the
outstanding Common Stock.
(b) Pursuant to the Company Stockholder Voting Agreement, each
Company Stockholder agreed with Westwood that for an established period of time,
such Company Stockholder would, among other things, vote or cause to be voted
all shares of voting capital stock of the Company beneficially owned by such
Company Stockholder or its wholly owned affiliates in favor of the adoption and
approval of the Merger Agreement. In addition, each Company Stockholder agreed
to appoint representatives of Westwood as proxies to vote all voting capital
stock of the Company beneficially owned by such Company Stockholder or its
wholly owned affiliates in favor of the adoption and approval of the Merger
Agreement. As a result, Westwood shares the power to vote (1) the 7,615,610
shares of Common Stock owned of record by Mr. Saperstein, (2) the 1,000 shares
of Common Stock owned by Mr. Coppola and (3) the 2,549,750 shares of Preferred
Stock owned of record by Mr. Saperstein (or the shares of Common Stock issuable
upon the conversion of such shares) with Mr. Saperstein or Mr. Coppola, as the
case may be.
(c) Except as set forth or incorporated by reference herein,
neither Westwood nor, to the best of its knowledge, any executive officer or
director of the Westwood identified on Appendix I hereto has effected any
transaction in the Common Stock during the past 60 days.
(d) Pursuant to the terms of the Company Stockholder Voting
Agreement, each of the Company Stockholders has agreed to disgorge to Westwood
certain profits from the sale of such Company Stockholder's shares of voting
capital stock of the Company in the event that (i) the Merger Agreement is
terminated under certain circumstances where Westwood is entitled to receive a
Termination Fee (as defined in the Merger Agreement) or (ii) a Company
Acquisition Proposal (as defined in the Merger Agreement) is made and the Merger
subsequently is consummated for an amount of consideration exceeding that
contemplated by the Merger Agreement.
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The foregoing description of the Company Stockholder Voting
Agreement does not purport to be complete and is qualified in its entirety by
reference to the Company Stockholder Voting Agreement, a copy of which has been
filed as an exhibit hereto and is incorporated herein by reference.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS, OR RELATIONSHIPS
WITH RESPECT TO THE ISSUER.
The matters described in Items 3, 4 and 5 hereof are
incorporated by reference in this Item 6 as if fully set forth herein.
Other than the Company Stockholder Voting Agreement, the
Merger Agreement, the Saperstein Consulting Agreement, the Bortnick Employment
Agreement and the Coppola Employment Agreement, there are no contracts,
understandings, or relationships (legal or otherwise) among the persons named in
Item 2 hereof and between such persons or any person with respect to any
securities of the Company, including but not limited to transfer or voting of
any of the Common Stock, finder's fees, joint ventures, loan or option
arrangements, put or calls, guarantees of profits, division of profits or loss,
or the giving or withholding of proxies.
The foregoing descriptions of the Merger Agreement, the
Company Stockholder Voting Agreement, the Saperstein Consulting Agreement, the
Bortnick Employment Agreement and the Coppola Employment Agreement do not
purport to be complete and are qualified in their entirety by reference to such
agreements, a copy of each which has been filed as an exhibit hereto and is
incorporated herein by reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit 1 Agreement and Plan of Merger, dated as of June 1, 1999, by
and among Westwood One, Inc., Copter Acquisition Corp., and
Metro Networks, Inc. (incorporated by reference to Exhibit
2.1 to Westwood's Current Report on Form 8-K filed with the
Securities Exchange Commission on June 4, 1998).
Exhibit 2 Company Stockholders Voting Agreement, dated as of June 1,
1999, by and among Westwood, Inc., David I. Saperstein,
Charles I. Bortnick and Shane E. Coppola
Exhibit 3 Consulting Agreement, dated as of June 1, 1999, between
Westwood One, Inc. and David I. Saperstein
Exhibit 4 Employment Agreement, dated as of June 1, 1999, between
Westwood One, Inc. and Charles I. Bortnick
Exhibit 5 Employment Agreement, dated as of June 1, 1999, between
Westwood One, Inc. and Shane E. Coppola
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
June 11, 1999 By: WESTWOOD ONE, INC.
By: /s/ Gary J. Yusko
-----------------------------------
Gary J. Yusko
Senior Vice President -
Financial Operations
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APPENDIX I
The following table sets forth the name, business address,
position with Westwood and principal occupation or employment and the name and
principal business of any corporation or other organization in which such
employment is conducted by each director and executive officer of Westwood. The
principal business address of Westwood is 9540 Washington Boulevard, Culver
City, California 90232. All of the individuals whose names are listed below are
citizens of the United States.
<TABLE>
<CAPTION>
Name and Business Address Position with Westwood; Principal Occupation or Employment
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<S> <C>
Mel Karmazin Director; Chief Executive Officer, President and Chief Operating Officer
of CBS Corporation; Chief Executive Officer and President of Infinity
Broadcasting Corporation
51 West 52nd Street
New York, NY 10019
Norman J. Pattiz Chairman of the Board
9540 Washington Blvd.
Culver City, California 90232
Joseph B. Smith Director; President of Unison Productions, Inc.
814 Greenway Drive
Beverly Hills, California 90210
Paul G. Krasnow Director; President of Krasnow Insurance Services, Inc.
11111 Santa Monica Blvd., Suite 1050
Los Angeles, California 90025
Farid Suleman Director, Executive Vice President, Chief Financial
Officer and Secretary; Executive Vice President, Chief Financial
Officer and Treasurer of Infinity Broadcasting
Corporation; Senior Vice President, Finance of CBS Corporation
40 West 57th Street,
14th Floor
New York, NY 10019
David L. Dennis Director; Managing Director, Investment Banking of Donaldson, Lufkin &
Jenrette Securities Corporation
2121 Avenue of the Stars, 30th Floor
Los Angeles, California 90067
Steven A. Lerman Director; Member of the law firm of Leventhal, Senter and Lerman PLLC
2000 K Street, N.W., Suite 600
Washington, D.C. 20006
Gerald Greenberg Director; President of MJJ Music
2100 Colorado Avenue
Santa Monica, California 90404
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Joel Hollander President and Chief Executive Officer
1675 Broadway, 17th Floor
New York, New York 10019
</TABLE>
I-II
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EXHIBIT INDEX
Exhibit 1 Agreement and Plan of Merger, dated as of June 1, 1999, by
and among Westwood One, Inc., Copter Acquisition Corp., and
Metro Networks, Inc. (incorporated by reference to Exhibit
2.1 to Westwood's Current Report on Form 8-K filed with the
Securities Exchange Commission on June 4, 1998).
Exhibit 2 Company Stockholders Voting Agreement, dated as of June 1,
1999, by and among Westwood, Inc., David I. Saperstein,
Charles I. Bortnick and Shane E. Coppola*
Exhibit 3 Consulting Agreement, dated as of June 1, 1999, between
Westwood One, Inc. and David I. Saperstein*
Exhibit 4 Employment Agreement, dated as of June 1, 1999, between
Westwood One, Inc. and Charles I. Bortnick*
Exhibit 5 Employment Agreement, dated as of June 1, 1999, between
Westwood One, Inc. and Shane E. Coppola*
- -----------------------------
* Filed herewith
Exhibit 2
COMPANY STOCKHOLDER VOTING AGREEMENT
COMPANY STOCKHOLDER VOTING AGREEMENT, dated as of June 1, 1999 (this
"Agreement"), by and among WESTWOOD ONE, INC., a Delaware corporation
("Parent"), and each of the other signatories hereto (each, a "Stockholder" and,
collectively, the "Stockholders").
WHEREAS, concurrently herewith, Parent, Copter Acquisition Corp., a
Delaware corporation ("Merger Sub"), and Metro Networks, Inc. a Delaware
corporation (the "Company"), are entering into an Agreement and Plan of Merger
(the "Merger Agreement"; capitalized terms used without definition herein having
the meanings ascribed thereto in the Merger Agreement);
WHEREAS, among other things, the Merger Agreement provides for the
merger (the "Merger") of Merger Sub into the Company and the Share Issuance
pursuant thereto;
WHEREAS, each Stockholder is the record and beneficial owner of the
number of shares ("Shares") of each class of capital stock of the Company
entitled to vote ("Voting Stock") set forth opposite such Stockholder's name in
Schedule I hereto;
WHEREAS, approval and adoption of the Merger Agreement by the Company's
stockholders is required in order to consummate the Merger;
WHEREAS, the Board of Directors of the Company has, prior to the
execution of this Agreement, duly and validly approved and adopted the Merger
Agreement and has resolved and agreed to recommend to its stockholders that they
approve and adopt the Merger Agreement, and such approval, adoption, resolution
and agreement has not been withdrawn;
WHEREAS, the Stockholders are executing this Agreement (i) as an
inducement to Parent to enter into and execute the Merger Agreement and (ii) in
reliance upon the representations, warranties, agreements and covenants of
Parent set forth in the Merger Agreement; and
WHEREAS, a certain holder of shares of Parent capital stock is
concurrently executing the Parent Stockholder Voting Agreement pursuant to which
such holder is agreeing to vote for the Share Issuance as an inducement to the
Company to enter into and execute the Merger Agreement.
NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein, the parties hereto agree as follows:
Section 1. Agreement to Vote.
Each Stockholder hereby agrees (for itself and not as to any
other Stockholder) that, during the term of this Agreement, such Stockholder
shall, from time to time, at any meeting (whether annual or special and whether
NY2:\522952\07\B7$G07!.DOC\80764.0005
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or not an adjourned or postponed meeting) of stockholders of the Company,
however called, or in connection with any written consent of the holders of
Voting Stock, in either case, prior to the earlier of the Effective Time and the
termination of this Agreement, appear at such meeting or otherwise cause the
Shares to be counted as present thereat for purposes of establishing a quorum,
and such Stockholder shall vote or consent (or cause to be voted or consented),
in person or by proxy, all Shares, and any other voting securities of the
Company (whether acquired heretofore or hereafter) that are beneficially owned
by such Stockholder or its wholly-owned Affiliates or as to which such
Stockholder has, directly or indirectly, the right to vote or direct the voting,
in favor of the approval and adoption of the Merger Agreement. Each Stockholder
agrees, during the period commencing on the date hereof and ending on the
earlier of the Effective Time and the termination of this Agreement, not to, and
not to permit any of its wholly-owned Affiliates to, vote or execute any written
consent in lieu of a stockholders meeting or vote of the Company, if such
consent or vote by the stockholders of the Company would be inconsistent with or
frustrate the purposes or terms this Agreement or the Merger Agreement.
In furtherance and not in limitation of the foregoing, each
Stockholder hereby grants to, and appoints, Parent and each of Farid Suleman and
Joel Hollander in their respective capacities as officers of Parent, and any
individual who shall hereafter succeed to any such officer of Parent, and any
other designee of Parent, each of them individually, its irrevocable proxy and
attorney-in-fact (with full power of substitution) to vote the Shares as
indicated in this Section 1. Each Stockholder intends this proxy to be
irrevocable and coupled with an interest and will take such further action and
execute such other instruments as may be necessary to effectuate the intent of
this proxy.
Each Stockholder hereby revokes any and all previous proxies
with respect to its Shares or any other voting securities of the Company that
may relate to the approval of the Merger Agreement.
Section 2. Capture. In order to induce Parent and Merger Sub to enter into the
Merger Agreement, each of the Stockholders hereby agrees to the matters set
forth in this Section 2 with respect to the number of shares of Voting Stock set
forth opposite such Stockholder's name on Schedule I hereto, and all other
shares of Voting Stock acquired by such Stockholder after the date of this
Agreement (collectively, the "Subject Shares"):
(a) In the event that the Merger Agreement shall have been
terminated under circumstances where Parent is entitled to receive a Termination
Fee, each Stockholder shall pay to Parent on demand, an amount in cash or Voting
Stock (or securities into which such Voting Stock becomes convertible pursuant
to the consummation of a Company Acquisition Proposal), at such Stockholder's
election, equal to all Profit (as defined below) of such Stockholder from the
consummation of any Company Acquisition Proposal that is consummated within
twelve months or, if entered into within twelve months, consummated within
eighteen months of such termination. The "Profit" of any Stockholder from any
Company Acquisition Proposal shall equal 60% of the sum of (i) the aggregate
consideration received by such Stockholder pursuant to such Company Acquisition
Proposal, valuing any non-cash consideration (including any residual interest in
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the Company) at its fair market value on the date of such consummation plus (ii)
the fair market value, on the date of disposition, of all Subject Shares of such
Stockholder disposed of after the termination of the Merger Agreement and prior
to the date of such consummation less (iii) the fair market value of the
aggregate consideration that would have been paid or payable to such Stockholder
if he had received the Merger Consideration and/or Parent Series A Preferred
Stock (based on the fair market value of Parent Common Stock to which such
Parent Series A Preferred Stock would be convertible into) pursuant to the
Merger Agreement as originally executed, valued as of immediately prior to the
first public announcement by the Company of its intention to terminate the
Merger Agreement to pursue a Superior Proposal or by any party making a Company
Acquisition Proposal (whichever is lower).
(b) In the event that (i) prior to the Effective Time, a
Company Acquisition Proposal shall have been made and (ii) the Effective Time of
the Merger shall have occurred and Parent for any reason shall have increased
the amount of Merger Consideration payable, or the value of the Parent Series A
Preferred Stock exchangeable, over that set forth in the Merger Agreement in
effect on the date hereof (the "Original Merger Consideration"), each
Stockholder shall pay to Parent on demand an amount in cash equal to the product
of (A) the number of Subject Shares of such Stockholder and (B) 60% of the
excess, if any, of (1) the per share cash consideration or the per share fair
market value of any non-cash consideration, determined as of the Effective Time
of the Merger as the case may be, actually received by the Stockholder as a
result of the Merger, over (2) the fair market value of the Original Merger
Consideration determined as of the time of the first increase in the amount of
the Original Merger Consideration.
(c) For purposes of this Section 2, the fair market value of
any non-cash consideration consisting of:
(i) securities listed on a national securities exchange
or traded on the Nasdaq National Market shall be
equal to the average closing price per share of such
security as reported on such exchange or Nasdaq
National Market for the five trading days before and
after the date of determination; and
(ii) consideration which is other than cash or securities
of the form specified in clause (i) of this Section
2(c) shall be determined by a nationally recognized
independent investment banking firm mutually agreed
upon by the parties within ten (10) business days of
the event requiring selection of such banking firm;
provided, however, that if the parties are unable to
agree within two (2) business days after the date of
such event as to the investment banking firm, then
the parties shall each select one firm, and those
firms shall select a third investment banking firm,
which third firm shall make such determination;
provided further, that the fees and expenses of such
investment banking firm shall be borne equally by
Parent, on the one hand, and the Stockholders, on the
other hand. The determination of the investment
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banking firm shall be binding upon the parties.
(d) Any payment under this Section 2 shall (i) if paid in
cash, be paid by wire transfer of same day funds to an account designated by
Parent and (ii) if paid through a transfer of securities, be paid through
delivery of such securities, suitably endorsed for transfer.
Section 3. Restriction on Transfer, Proxies and
Non-Interference. Except as contemplated by this Agreement, each Stockholder
agrees not to, directly or indirectly, (i) offer for sale, sell, transfer,
tender, pledge, encumber, assign or otherwise dispose of, or enter into any
contract, option or other arrangement or understanding with respect to, or
consent to the offer for sale, transfer, tender, pledge, encumbrance, assignment
or other disposition (each, a "Disposition") of, any or all of the Shares or any
interest therein; (ii) grant any proxies or powers of attorney, deposit any
Shares into a voting trust or enter into a voting agreement with respect to any
Shares; or (iii) take any action that would make any representation or warranty
of such Stockholder contained herein untrue or incorrect, or have the effect of
preventing or disabling the Stockholder from performing the Stockholder's
obligations under this Agreement or the Company from performing the Company's
obligations under the Merger Agreement.
Section 4. Restriction on Transfer of Shares of Parent Common
Stock. Each Stockholder agrees not to effect any Disposition during any of the
first three 12-month periods (i.e., 3 years) following the Effective Time of an
aggregate number of shares of Parent Common Stock in excess of 33 1/3% of the
number of shares of Parent Common Stock received by such Stockholder in the
Merger. Notwithstanding anything to the contrary in this Agreement, a
Disposition shall not include the exercise of options, and the sale of shares
issuable upon the exercise of such options, by a Stockholder or the repayment of
shares subject to a stock loan and pledge agreement.
Section 5. Non-Solicitation. Each Stockholder shall comply in
all respects with the non-solicitation and other provisions of Section 5.5 of
the Merger Agreement and the other provisions of the Merger Agreement related
thereto, and shall not take any of the actions or do any of the things
restricted or otherwise prohibited thereby.
Section 6. Further Assurances. Each party shall execute and
deliver such additional instruments and other documents and shall take such
further actions as may be necessary or appropriate to effectuate, carry out and
comply with all of its obligations under this Agreement.
Section 7. Representations and Warranties of Parent. Parent
represents and warrants to each Stockholder as follows:
(a) This Agreement has been approved by the Board of Directors
of Parent, representing all necessary corporate action on the part of Parent for
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the execution and performance hereof and thereof by Parent (no action by the
stockholders of Parent being required).
(b) This Agreement has been duly executed and delivered by a
duly authorized officer of Parent.
(c) This Agreement constitutes the valid and binding agreement
of Parent, enforceable against Parent in accordance with its terms.
(d) The execution and delivery of this Agreement by Parent
does not violate or breach, and will not give rise to any violation or breach,
of Parent's charter or bylaws, or, except as will not materially impair its
ability to effectuate, carry out or comply with all of the terms of this
Agreement or the Merger Agreement, any Law, Governmental Entity approval or
contract by which Parent or its subsidiaries or their respective assets or
properties may be bound.
Section 8. Representations and Warranties of the Stockholders.
Each Stockholder, as to such Stockholder only, represents and warrants to Parent
as follows:
(a) Schedule I sets forth, opposite each Stockholder's name,
the number and type of Shares of which such Stockholder is the record or
beneficial owner and the number of votes per share to which the Stockholder is
entitled with respect to the Merger Agreement. Such Stockholder is the lawful
owner of such Shares, free and clear of all liens, charges, options, rights,
encumbrances, stockholders agreements, voting agreements, agreements to transfer
or otherwise dispose of such Shares and commitments of every kind, other than
this Agreement and as disclosed in Schedule II and has the sole power to vote
(or cause to be voted) the Shares as set forth in this Agreement. Except as set
forth on such Schedule I, neither such Stockholder nor any of its Affiliates
owns or holds any rights to acquire any additional shares of any class of Voting
Stock or other securities of the Company or any interest therein or any voting
rights with respect to any additional shares of any class of Voting Stock or any
other securities of the Company.
(b) This Agreement has been duly executed and delivered by a
duly authorized officer of such Stockholder or, if the Stockholder is a natural
person, the Stockholder has the legal capacity to execute this Agreement.
(c) This Agreement constitutes the valid and binding agreement
of such Stockholder, enforceable against such Stockholder in accordance with its
terms.
(d) The execution and delivery of this Agreement by such
Stockholder do not violate or breach, and will not give rise to any violation or
breach, of such Stockholder's charter, by-laws, trust instrument or partnership
agreement, to the extent applicable, or, except as will not materially impair
the ability of such Stockholder to effectuate, carry out or comply with all of
the terms of this Agreement, any Law, third party consent, approval, filing,
registration or similar requirement of any Governmental Entity or any agreement
or contract by which such Stockholder or its assets or properties are bound.
5
<PAGE>
Section 9. Effectiveness and Termination. In the event the
Merger Agreement is terminated in accordance with its terms or immediately upon
the Effective Time, this Agreement shall automatically terminate and be of no
further force or effect, except that the provisions of Section 2 hereof shall
survive any such termination. Upon such termination, except for any rights any
party may have in respect of any breach by any other party of its obligations
hereunder, none of the parties hereto shall have any further obligation or
liability hereunder other than pursuant to Section 2 hereof. This Agreement
shall continue in full force and effect despite any amendment or other
modification of, or any consent or waiver under, the Merger Agreement; provided,
however, (A) that any amendment by the parties to the Merger Agreement to (x)
the Exchange Ratio or the Merger Consideration (each as defined in Section
2.1(b) of the Merger Agreement), (y) Section 5.5(a) of the Merger Agreement
(including the definition of "Company Acquisition Proposal" set forth in Section
5.5(c) thereof) or (z) Article 7 of the Merger Agreement entitled "Termination;
Amendment; Waiver" or (B) the waiver on or prior to the Closing Date by the
Company of any material condition precedent set forth in Article 6 of the Merger
Agreement, shall require the written consent of the Stockholders, failing which
this Agreement may be terminated in writing by any Stockholder who has not
consented to such amendment or such waiver. In any event, if the Effective Time
shall not have occurred on or before the Termination Date, this Agreement may be
terminated in writing by any Stockholder and it shall be of no further force or
effect as to such Stockholder.
Section 10. Voting Agreement.
David Saperstein agrees that he shall enter into a voting
agreement with Infinity Broadcasting Corporation at the Effective Time pursuant
to which David Saperstein shall agree, subject to any applicable laws or
regulations of the exchange where the Parent's securities are listed, to vote
all shares of capital stock of Parent for the election of Infinity Broadcasting
Corporation's designees to the Parent's Board of Directors, to the extent such
designees have been nominated by Parent's Board of Directors or a committee
thereof, for election at such meeting.
Section 11. Miscellaneous.
(a) 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 cable,
telegram, confirmed facsimile or telex, or by first class mail (postage prepaid,
return receipt requested), to the other party as follows:
if to Parent, to Westwood One, Inc.
9540 Washington Boulevard
Culver City, California 90232
Attention: Joel Hollander
Facsimile: (310) 840-4059
6
<PAGE>
with a copy to: Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153-0119
Attention: Howard Chatzinoff, Esq.
Facsimile: (212) 310-8007
if to any Stockholder, to
c/o Metro Networks, Inc.
2800 Oak Post Boulevard
Suite 4000
Houston, Texas 77056
Attention: David I. Saperstein
Facsimile: (713) 407-6049
with a copy to Paul, Hastings, Janofsky &
Walker, LLP
399 Park Avenue
New York, New York 10022
Attention: Neil A. Torpey, Esq.
Facsimile: (212) 319-4090
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.
(b) 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.
(c) Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which shall constitute one and the same agreement.
(d) Entire Agreement; No Third Party Beneficiaries. This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter hereof. This Agreement shall be binding upon and inure solely to
the benefit of each party hereto, and nothing in this Agreement, express or
implied, is intended to or shall confer upon any other Person any right, benefit
or remedy of any nature whatsoever under or by reason of this Agreement.
(e) Waiver of Jury Trial. Each party hereto waives, to the
fullest extent permitted by applicable law, any right it may have to a trial by
jury in respect of any litigation directly or indirectly arising out of, under
or in connection with this Agreement.
(f) Governing Law. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware applicable to
contracts made, executed, delivered and performed wholly within such state and,
in any case, without regard to the principles or policies of conflicts of laws
of such state.
7
<PAGE>
(g) Severability. If any term or other provision of this
Agreement is invalid, illegal or unenforceable, all other provisions of this
Agreement shall remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.
(h) Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto, in whole or in part (whether by operation of law or otherwise), without
the prior written consent of the other parties hereto and the written
undertaking of the assignee to be bound by the terms of this Agreement, and any
attempt to make any such assignment without such consent shall be null and void.
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 permitted assigns.
(i) Submission to Jurisdiction; Waivers. Each of Parent and
each Stockholder irrevocably agrees that any legal action or proceeding with
respect to this Agreement or for recognition and enforcement of any judgment in
respect hereof brought by the other party hereto or its successors or assigns
may be brought and determined in the Chancery or other Courts of the State of
Delaware, and each of Parent and each Stockholder hereby irrevocably submits
with regard to any such action or proceeding for itself and in respect to its
property, generally and unconditionally, to the exclusive jurisdiction of the
aforesaid courts. Each of Parent and each Stockholder hereby irrevocably waives,
and agrees not to assert, by way of motion, as a defense, counterclaim or
otherwise, in any action or proceeding with respect to this Agreement, (a) any
claim that it is not personally subject to the jurisdiction of the above-named
courts for any reason other than the failure to serve process in accordance with
this Section 11(i), (b) that it or its property is exempt or immune from
jurisdiction of any such court or from any legal process commenced in such
courts (whether through service of notice, attachment prior to judgment,
attachment in aid of execution of judgment, execution of judgment or otherwise),
and (c) to the fullest extent permitted by applicable law, that (i) the suit,
action or proceeding in any such court is brought in an inconvenient forum, (ii)
the venue of such suit, action or proceeding is improper or (iii) this
Agreement, or the subject matter hereof, may not be enforced in or by such
courts.
(j) Specific Performance. The parties hereto acknowledge that
irreparable damage would result if this Agreement were not specifically
enforced, and they therefore consent that the rights and obligations of the
parties under this Agreement may be enforced by a decree of specific performance
issued by a court of competent jurisdiction. Such remedy shall, however, not be
exclusive and, shall be in addition to any other remedies which any party may
have under this Agreement or otherwise.
(k) Expenses. Each of Parent and each Stockholder shall bear
its own expenses incurred in connection with this Agreement and the transactions
contemplated hereby.
(l) Action in Stockholder Capacity Only. No Stockholder makes
any agreement or understanding herein as a director or officer of the Company or
in any capacity other than as a stockholder of the Company. Each Stockholder
8
<PAGE>
signs solely in its capacity as a record holder and beneficial owner of Shares
and nothing herein shall limit or affect any actions taken by a representative
of such Stockholder in such representative's capacity as an officer or director
of the Company.
(m) Obligations Several. The obligations of each Stockholder
under this Agreement shall be several and not joint. No Stockholder shall have
any liability, duty or obligation arising out of or resulting from any failure
by any other Stockholder (or any Affiliate thereof) to comply with the terms and
conditions of this Agreement.
[SIGNATURES BEGIN ON NEXT PAGE]
9
<PAGE>
SIGNATURE PAGE TO COMPANY STOCKHOLDER VOTING AGREEMENT
IN WITNESS WHEREOF, the parties have duly executed this Company
Stockholder Voting Agreement as of the date first above written.
WESTWOOD ONE, INC.
By: /s/ Farid Suleman
---------------------------------
Name: Farid Suleman
Title: Executive Vice President,
Chief Financial Officer
and Secretary
/s/ David I. Saperstein
-------------------------------------
DAVID I. SAPERSTEIN
/s/ Charles I. Bortnick
-------------------------------------
CHARLES I. BORTNICK
/s/ Shane E. Coppola
-------------------------------------
SHANE E. COPPOLA
<PAGE>
Schedule I
Ownership of Voting Stock
<TABLE>
<CAPTION>
Name and Address Class and Series Number of Shares Number of
of Stockholder of Voting Stock Owned Votes per Share
- -------------- --------------- ----- ---------------
<S> <C> <C> <C>
David I. Saperstein Common Stock 7,615,610 1
Series A
Convertible
Preferred Stock 2,549,750 1
Charles I. Bortnick Common Stock 0 1
Shane E. Coppola Common Stock 1,000 1
</TABLE>
<PAGE>
Schedule II
Liens on Shares
1. Share certificates nos. 1 (1,387,064 shares of Series A Convertible Preferred
Stock), 2 (1,122,686 shares of Series A Convertible Preferred Stock) and 11
(1,050,750 shares of common stock) are pledged under the stock loan agreements
between David Saperstein and the Company or David Saperstein and certain trusts
for the benefit of his children.
2. 350,000 shares of common stock held by Goldman Sachs & Co. are pledged to
secure a loan of $5,000,000 made by Goldman Sachs & Co. to an entity controlled
by Mr. Saperstein.
Exhibit 3
CONSULTING AGREEMENT
CONSULTING AGREEMENT, dated as of June 1, 1999, by and between Westwood
One, Inc. a Delaware corporation (the "Company"), and David I. Saperstein (the
"Executive").
WHEREAS, Executive is currently employed by Metro Networks, Inc., a
Delaware corporation ("Metro"), as Chairman of the Board and Chief Executive
Officer;
WHEREAS, the Company, Copter Acquisition Corp., a Delaware corporation
("Merger Sub"), and Metro entered into the Agreement and Plan of Merger, dated
as of June 1, 1999 (the "Merger Agreement") pursuant to which Merger Sub is
being merged (the "Merger") into Metro, and (b) simultaneously herewith,
Executive is entering into a Non-Compete Agreement (the "Non-Compete
Agreement"), pursuant to which Executive has agreed to refrain from taking
certain actions in competition with the Company and its affiliates following the
Effective Time (as defined in the Merger Agreement ); and
WHEREAS, the Company desires to induce Executive after the Effective
Time (the "Effective Date") to act as a consultant to the Company and to refrain
from competing with the Company pursuant to the terms of the Non-Compete
Agreement, and Executive desires to commit himself to act as a consultant to the
Company and to refrain from competing with the Company pursuant to the terms of
the Non-Compete Agreement;
NOW THEREFORE, in order to effect the foregoing, the Company and
Executive wish to enter into this Agreement upon the terms and subject to the
conditions set forth below. Accordingly, in consideration of the premises and
the respective covenants and agreements of the parties herein contained, and
intending to be legally bound hereby, the parties hereto agree as follows:
1. Term and Services to be Provided. Commencing on the
Effective Date and continuing until two and one-half years after the Effective
Date (the "Term"), Executive agrees to provide consulting services to the
Company from time to time at the reasonable request of the Company up to a
maximum of ten (10) hours per month. Such consulting services shall consist of
advising the Company with respect to general business matters, issues and
strategies relating to the Company's business. In the event that the Merger
Agreement is terminated, this Consulting Agreement shall be cancelled and shall
be of no force or effect.
2. Compensation.
(a) During the Term, the Company shall pay Executive
consulting fees at the rate of $100,000 per annum, payable in arrears in equal
monthly installments.
(b) Upon submission of all necessary properly completed
expense reports requested by the Company, the Company shall reimburse Executive,
or cause
NY2:\526658\06\B@D#06!.DOC\80764.0005
<PAGE>
Executive to be reimbursed, in cash for all reasonable, receipt-supported,
business expenses incurred by Executive in accordance with the Company's
policies in effect from time to time.
3. Title. The Company shall cause Executive to be appointed to
the position of Vice-Chairman of Metro Networks, Inc., a wholly-owned subsidiary
of the Company, during the Term.
4. Options. The Company and Executive agree that all Company
Stock Options (as defined in the Merger Agreement) held by Executive and issued
pursuant to any Company Option Plans (as defined in the Merger Agreement) and
converted into the right to purchase Parent Common Stock (as defined in the
Merger Agreement) in accordance with Section 2.3 of the Merger Agreement shall
remain outstanding and shall continue to vest in accordance with the applicable
terms of each of such Company Stock Options, and shall be exercisable for a
period ending ninety (90) days after the end of the Term; provided, however,
that any Company Stock Options which have not become exercisable to purchase
shares of Parent Common Stock as of the termination of this Agreement shall be
terminated, and Executive shall thereafter have no rights pursuant to such
terminated Company Stock Options.
5. Termination of Stock Loan. The Company hereby agrees that
it shall not, as successor of Metro to the Stock Loan and Pledge Agreement,
dated as of October 16, 1996, by and between Metro and Executive, exercise its
right to terminate such agreement pursuant to Section 4.1(a) thereof prior to
the fifth anniversary of the Effective Date.
6. Termination.
(a) Death. Executive's consulting relationship with the
Company hereunder shall terminate upon his death.
(b) Disability. If, as a result of Executive's incapacity due
to physical or mental illness, Executive shall be unable to perform the
consulting services described herein for a continuous period of six months, the
Company may terminate Executive's consulting relationship with the Company. In
such event, Executive shall receive the compensation provided in Section 2(a)
hereof in monthly installments of substantially equal amounts.
(c) Termination by the Company for Cause. The Company may
terminate Executive's engagement for Cause after ten (10) days prior written
notice from the Chief Executive Officer of the existence of any facts or
circumstances constituting Cause if such facts or circumstances remain
unremedied following such ten (10) day period. For purposes of this Agreement,
The Company shall have "Cause" to terminate Executive's engagement hereunder
upon Executive's:
i) conviction (including a plea of nolo contendere) for the
commission of a felony; or
2
<PAGE>
ii) willful misconduct that is demonstrably and materially
injurious to the Company, whether monetarily or otherwise; or
iii) breach of any of the provisions of the Non-Compete
Agreement.
If the Company terminates Executive's engagement hereunder for
Cause, the Company shall have no further obligations to Executive under this
Agreement, except for the payment of any accrued and unpaid expenses.
7. Notice. 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 cable,
telegram, confirmed facsimile or telex, or by first class mail (postage prepaid,
return receipt requested), to the other party as follows:
If to the Company: Westwood One, Inc.
9540 Washington Boulevard
Culver City, California 90232
Attention: Joel Hollander
Facsimile: (310) 840-4059
If to Executive: David I. Saperstein
c/o Metro Networks, Inc.
2800 Oak Post Boulevard
Suite 4000
Houston, Texas 77056
Facsimile: (713) 407-6049
Copy to: Paul Hastings, Janofsky & Walker LLP
399 Park Avenue
New York, NY 10022
Attn: Neil Torpey
Facsimile: (212) 319-4090
or to such other address as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
8. Executive's Independence and Discretion.
(a) Nothing herein contained shall be construed to constitute
the parties hereto as partners or as joint venturers, or either as agent of the
other, or as employer and employee. By virtue of the relationship described
herein, Executive's relationship to the Company during the Term shall only be
3
<PAGE>
that of an independent contractor and Executive shall perform all services
pursuant to this Agreement as an independent contractor.
(b) Subject only to such specific limitations as are contained
in this Agreement, the manner, means, details or methods by which Executive
performs his obligations under this Agreement shall be solely within his
discretion.
9. Modifications. This Agreement may be amended, modified and
supplemented only by written agreement of the parties hereto.
10. No Waiver. No failure or delay on the part of any party in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy hereunder.
11. Validity. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in
full force and effect.
12. Entire Agreement. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter hereof.
13. Successors and Assigns. This Agreement shall inure to the
benefit of and the successors and assigns of the Company. The Company may assign
its rights under this Agreement in connection with any sale, transfer of other
disposition of all or a substantial portion of the stock or assets of the
Company. Executive may not assign his duties or obligations hereunder.
14. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same agreement.
15. 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.
16. Governing Law. This Agreement shall be instituted and
enforced in accordance with, and governed by, the laws of the State of New York
applicable to contracts to be made, executed, delivered and performed wholly
within such state and, in any case, without regard to the conflicts of law
principles and policies of such state.
[SIGNATURES BEGIN ON NEXT PAGE]
4
<PAGE>
SIGNATURE PAGE TO CONSULTING AGREEMENT
IN WITNESS WHEREOF, the parties have executed this Consulting
Agreement on the date and year first above written.
WESTWOOD ONE, INC.
By: /s/ Farid Suleman
---------------------------------
Name: Farid Suleman
Title: Executive Vice President,
Chief Financial Officer
and Secretary
/s/ David I. Saperstein
-------------------------------------
DAVID I. SAPERSTEIN
Exhibit 4
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of June 1, 1999 (this
"Agreement"), is entered into by and between CHARLES I. BORTNICK ("Employee")
and WESTWOOD ONE, INC., a Delaware corporation (the "Company").
RECITALS:
WHEREAS, the Company is in the business of managing a sales
force, selling broadcast and other advertising, and developing, producing and
broadcasting traffic, news, sports, weather and other information reports
throughout the United States; and
WHEREAS, Employee has extensive management, marketing and
operations experience; and
WHEREAS, the Company desires to engage the services of
Employee to serve as President and Chief Operating Officer of the Company's
Metro/Shadow operations ("Metro/Shadow") on the terms and conditions herein
contained; and
NOW, THEREFORE, for and in consideration of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:
1. Employment. The Company hereby engages and employs
Employee, and Employee accepts such employment, to render such services to the
Company as President and Chief Operating Officer of Metro/Shadow as are
customarily rendered by and required by such a position, and Employee agrees to
devote Employee's full time and efforts to the interests of the Company upon the
terms and conditions hereinafter set forth.
2. Term of Employment. Subject to the provisions for
termination hereinafter provided, Employee's term of employment by the Company
shall commence at the Effective Time (as defined in the Agreement and Plan of
Merger, dated as of June 1, 1999, by and among the Company, Metro Networks, Inc.
and Copter Acquisition Corp. (the "Effective Date"), and shall continue in
effect until the later of (i) twenty-four (24) months from the Effective Date
and (ii) December 31, 2001 (the "Term"). Unless otherwise terminated pursuant
hereto, if Employee continues to be employed by the Company after the Term, then
Employee's employment shall be deemed to continue on a month-to-month basis
until such time as either party shall deliver written notice to the other party
and this Agreement shall terminate ninety (90) days after the giving of such
notice. Except as otherwise set forth herein, if either party hereto desires to
terminate this Agreement at the end of the Term or thereafter, the same ninety
(90) days prior written notice shall apply. The period from the Effective Date
through the date ninety (90) days from the date any notice of termination
referred to above is delivered is hereinafter referred to as the "Employment
Period". Unless otherwise
NY2:\526856\06\B@$W06!.DOC\80764.0005
<PAGE>
terminated pursuant to Section 7, if the Company terminates Employee's
employment at the end of the Term or anytime thereafter, or the parties are
unable to agree on the terms of a new agreement at the end of the Term and
Employee terminates his employment, the Company shall pay Employee the
equivalent of his monthly Base Salary (as defined herein) for ninety (90) days
following the end of Employee's employment.
3. Services to be Rendered by Employee.
(a) During the Employment Period, Employee shall serve as
President and COO of Metro/Shadow. Employee shall perform such executive duties
as from time to time may be delegated to Employee by such parties. Employee
shall devote all of Employee's professional time, energy and ability to the
proper and efficient conduct of the Company's business. Employee shall observe
and comply with all reasonable lawful directions and instructions by and on the
part of the Chief Executive Officer or the Board of Directors of the Company
(the "Board of Directors") or their designees, and endeavor to promote the
interests of the Company and not at any time do anything which may cause or tend
to be likely to cause any loss or damage to the Company in business, reputation
or otherwise.
(b) The Company may from time to time call on Employee to
perform services related to the business of developing and broadcasting traffic,
news, sports and weather reports, which may include (in the Company's sole
discretion) contributing to the day-to-day management and operation of such
business, soliciting Sponsors, Corporate Affiliates (as such terms are defined
in Section 14 hereof) or customers or dealing with their accounts, or the
television or radio broadcast of traffic, news, sports and weather reports, or
other activities related to the Company's business, as reasonably specified from
time to time by the Chief Executive Officer, the Board of Directors or their
designees. The Company shall not relocate Employee to another city without
Employee's prior consent.
(c) Employee acknowledges that the Company does not allow
personal trade.
4. Compensation.
(a) Base Salary. For the services to be rendered by Employee
during Employee's employment by the Company, the Company shall pay Employee, and
Employee agrees to accept, a base salary (the "Base Salary") of $325,000 for
year one and $350,000 for year two, in each case payable in accordance with the
Company's standard payroll procedures.
(b) Bonus. Employee shall be eligible for a potential cash
bonus of $125,000 for year one and $150,000 for year two, in each case based on
achieving cash flow objectives established by the Chief Executive Officer, which
objectives may be modified by the Chief Executive Officer based on changes in
facts or circumstances in his/her reasonable discretion.
2
<PAGE>
(c) Options. Employee will be granted options, at the then
current market price on the date of grant, under the Company's 1999 Stock Option
Plan to purchase seventy-five thousand (75,000) shares, of the Company's common
stock, par value $.01 per share, on each of the Effective Date and the first
anniversary of the Effective Date. The option agreement relating to such options
shall provide that such options shall vest ratably over 5 years, provided,
however, that vesting will be accelerated if employee is terminated without
cause (for purposes of this Agreement, termination for cause shall be limited to
termination pursuant to Sections 7(a)(i), (ii), (iv) and (v) hereof), or if this
Agreement is not renewed on terms substantially similar to this Agreement,
excluding the annual grant of stock options.
5. Expenses. Upon submission of all necessary properly
completed expense reports requested by the Company, the Company shall reimburse
Employee, or cause Employee to be reimbursed, in cash for all reasonable,
receipt-supported, business expenses incurred by Employee in accordance with the
Company's policies in effect from time to time.
6. Benefits.
(a) Company Plans; Insurance. During the Term, Employee shall
receive all the benefits currently available to comparable level employees of
the Company. Employee recognizes the right of the Company to change, amend or
terminate any of the afore-mentioned employee benefit programs at any time.
(b) Vacation. Employee shall be entitled to vacation time in
accordance with the Company's employee handbook. Such vacation time may only be
used subject to reasonable approval by the Chief Executive Officer of the
Company.
(c) Years of Service. For purposes of determining years of
service, Employee shall be given credit for years of service at Metro/Shadow and
its subsidiaries.
7. Termination of Employment; Suspension.
(a) During the Employment Period, the Company shall have the
right, to terminate the employment of Employee hereunder immediately with or
without notice thereof to Employee in the event of any of the following:
(i) if Employee has (A) willfully failed, refused or
habitually has neglected to carry out or to perform the reasonable duties
required of Employee hereunder or otherwise breached any material provision of
this Agreement (other than Sections 8 and 13 hereof, which are governed by
Section 7(a)(iv) hereof) after ten (10) days prior written notice from the Chief
Executive Officer or the Board of Directors of such failure or neglect and the
failure or neglect remains unremedied following such ten (10) days period, or
(B) willfully breached any statutory or common law duty.
3
<PAGE>
(ii) if Employee is convicted of a felony or a crime involving
moral turpitude or if the Company, acting in good faith and upon reasonable
grounds, determines that Employee has willfully engaged in conduct which would
injure the reputation of the Company or otherwise adversely affect its interest
if Employee were retained as an employee of the Company;
(iii) if Employee becomes unable by reason of physical
disability or other incapacity (as may be defined in applicable disability
insurance policies) to carry out or to perform the duties required of Employee
hereunder for a continuous period of ninety (90) days; provided, however, that
Employee's compensation during any period in which Employee is unable to perform
the duties required of Employee hereunder shall be reduced in accordance with
the Company's policies and by any disability payments (excluding any
reimbursements for medical expenses and the like) which Employee is entitled to
receive under group or other disability insurance policies of the Company during
such period;
(iv) if Employee breaches any of the provisions of Section 8
or 13 hereof or breaches any of the terms or obligations of any other
noncompetition and/or confidentiality agreements entered into between Employee
and the Company, or the Company Group (as hereinafter defined), if any; or
(v) if employee steals or embezzles assets of the Company.
(b) Employee's employment with the Company shall automatically
terminate (without notice to Employee's estate) upon the death or loss of legal
capacity of Employee.
(c) If Employee willfully fails to perform in any material
respect any of the obligations set forth in this Agreement, or in the event of
any willful breach by Employee of any representation, warranty, term, obligation
or condition of this Agreement, the Company shall have the right, at its sole
option, in addition to the rights set forth in this Agreement or any other
rights at law or in equity, to discipline Employee, by suspension from work,
and/or suspension of or reduction in pay.
(d) In the event of any termination of employment pursuant to
this Section 7, Employee (or Employee's estate, as the case may be) shall be
entitled to receive (i) the Base Salary herein provided prorated to the date of
such termination, (ii) Employee's present entitlement, if any, under the
Company's employee benefit plans and programs and (iii) no other compensation.
8. Confidentiality; Non-Competition; Non-Solicitation.
(a) Employee recognizes and acknowledges that he has had
access to certain information of members of the Company Group (as hereinafter
defined) and that such information is confidential and constitutes valuable,
special and unique property of such members of the Company Group. Employee shall
not, directly or indirectly, at any time after the Effective Date, disclose,
4
<PAGE>
divulge, publish or otherwise communicate to anyone, nor retain, copy or permit
to be copied, or make use of for personal purposes or for the benefit of any
person, firm, corporation or other entity (other than the Company Group) any
Confidential Information (as defined below) of any member of the Company Group
(regardless of whether developed by such party) without the prior written
consent of the Company.
As used herein, "Company Group" means the Company and its
subsidiaries, and any entity that directly or indirectly controls, is controlled
by, or is under common control with, the Company and its subsidiaries. For
purposes of this definition, "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such entity, whether through the ownership of voting securities, by
contract or otherwise.
(b) The term "Confidential Information" with respect to any
person means any trade secrets and any other secret or confidential information
or knowledge and shall include, but shall not be limited to, (i) the plans,
methods, costs, prices, uses and applications of products and services relating
to the Business (as hereinafter defined), (ii) results of investigations,
studies or research relating to the Business, (iii) information relating to
employees, agents, broadcasters, customers, suppliers and advertisers of the
Business, (iv) all products, processes, compositions, samples, formulae,
computer programs and information systems relating to the Business, (v) all
servicing, marketing, programming or business methods and techniques relating to
the Business and (vi) all business plans, financial matters and all information
relating to mergers and acquisitions relating to the Business, in all such cases
before or during the term of this Agreement, that are not available to the
public or that are maintained as confidential by any member of the Company
Group.
(c) During the Term of this Agreement and for a period of one
year thereafter, without the prior written consent of the Company, Employee
shall not, and shall not permit any person or entity who or which Employee
controls (as defined above) to, within the United States (the "Territory"),
engage directly or indirectly in the Business (other than engaging in such
businesses pursuant to Employee's employment or consultation with, participation
in the management of, or ownership of securities in, the Company Group). For
purposes of this Agreement, "Business" shall mean the businesses of the Company
(as now conducted or contemplated to be conducted) including without limitation,
the businesses of (i) providing traffic reporting services, however distributed,
including, without limitation, to television and radio stations, Internet
service providers and any other person or entity who or which may distribute
such services or information through any media, now existing or hereafter
available or (ii) providing local news, sports or weather reporting to radio
stations. Employee shall be deemed to engage in the Business if Employee,
directly or indirectly (including, without limitation, through any person or
entity who or which Employee controls), engages or invests in, owns, manages,
operates, controls or participates in the ownership, management, operation or
control of, is employed by, provides financial support, or renders services or
advice to, any business engaged in the Business; provided, however, that (x)
Employee or any such person or entity may invest in the securities of any
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enterprise (but without otherwise participating in the activities of such
enterprise) if (1) such securities are listed on any national or regional
securities exchange or have been registered under Section 12(g) of the
Securities Exchange Act of 1934, as amended, and (2) Employee does not
beneficially own (as defined Rule 13d-3 promulgated under the Securities
Exchange Act of 1934, as amended) 5% or more of the outstanding equity of such
enterprise and (y) Employee shall not be deemed to engage in the Business as a
result of his employment with a business so engaged so long as the
responsibilities and activities with respect to his employment are not related,
directly or indirectly, in any material respect to the conduct by such business
of its Business.
(d) During the Term of this Agreement and for a period of one
year thereafter, Employee shall not, directly or indirectly, request, induce,
attempt to influence or have any other business contact with any employee,
officer, agent or consultant of any member of the Company Group or any talent
providing services to the Company Group, to terminate his or her relationship
with such member of the Company Group.
9. Enforceability. Employee agrees that if a court of
competent jurisdiction determines that the length of time or any other
restriction, or portion thereof, set forth in this Agreement is overly
restrictive and unenforceable, the court may reduce or modify such restrictions
to those which it deems reasonable and enforceable under the circumstances, and
as so reduced or modified, the parties hereto agree that the restrictions of
this Agreement shall remain in full force and effect. Employee further agrees
that if a court of competent jurisdiction determines that any provision of this
Agreement is invalid or against public policy, the remaining provisions of this
Agreement and the remainder of this Agreement shall not be affected thereby, and
shall remain in full force and effect. Employee acknowledges that the
restrictions imposed by the Agreement are legitimate, reasonable and necessary
to protect the Company Group's investment in its businesses and the goodwill
thereof. Employee acknowledges that the scope and duration of the restrictions
contained herein are reasonable in light of the time that Employee has been
engaged in the Business, Employee's reputation in the markets for the Business
and Employee's relationship with the suppliers, customers, advertisers and
clients of the Company Group. Employee further acknowledges that the
restrictions contained herein are not burdensome to Employee in light of the
consideration paid therefor and the other opportunities that remain open to
Employee.
10. Remedies. Employee acknowledges that money damages or
other remedy at law would not be a sufficient or adequate remedy for any breach
or violation of, or default under, this Agreement, but Employee agrees that in
addition to all other remedies available to the other parties hereto, such other
parties shall be entitled to the fullest extent permitted by law to an
injunction restraining such breach, violation or default or threatened breach,
violation or default and to any other equitable relief, including, without
limitation, restraining orders, injunctive relief and specific performance,
without the posting of a bond or other security interest being required.
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11. Advertising and Publicity. Employee hereby grants the
Company the royalty-free right to use and license others to use Employee's name,
nickname, recorded voice, biographical material, portraits, pictures, and
likenesses for advertising purposes and purposes of trade, promotion and
publicity in connection with the institutions, services and products for the
Company Group, Sponsors and Corporate Affiliates, such uses to be at such times,
in such manner and through such media as the Company may in its sole discretion
determine. Such right shall last for so long as Employee is employed by the
Company and, in connection with the use or exploitation of any material in which
Employee has been involved during Employee's employment, perpetually thereafter.
Employee shall not authorize or release any advertising or promotional matter or
publicity in any form with reference to Employee's services hereunder, or to the
Company Group's programs, Sponsors or Corporate Affiliates, without the
Company's prior written consent.
12. Work for Hire. Employee agrees that any ideas, concepts,
techniques, or computer programs relating to the business or operations of the
Company Group which are developed by Employee during Employee's employment
hereunder, including each program and announcement prepared for broadcast, and
the titles, content, format, idea, theme, script, characteristics, and other
attributes thereof, shall be deemed to have been made within the scope of
Employee's employment and therefore constitute works for hire and shall
automatically upon their creation become the exclusive property of the Company.
To the extent such items are not works for hire under applicable law, Employee
assigns them and any and all intangible proprietary rights relating thereto to
the Company in their entirety and agrees to execute any and all documents
necessary or desired by the Company to reflect the Company's ownership thereof.
13. Communications Act of 1934. Employee represents and
warrants that neither Employee nor, to the best of Employee's knowledge,
information and belief, any other person, has accepted or agreed to accept, or
has paid or provided or agreed to pay or provide, any money, service or any
other valuable consideration, as defined in Section 507 of the Communications
Act of 1934, as amended, for the broadcast of any matter contained in programs.
Employee further represents and warrants that, during Employee's employment,
Employee shall comply with all legal requirements.
14. Certain Definitions. As used in this Agreement, the
following capitalized terms shall have the meanings indicated:
(a) Corporate Affiliates. Any organization, entity or person
with whom the Company has or had a contract or other arrangement to provide
traffic, news, weather, sports or other information, whether by broadcast,
computer or any other means.
(b) Sponsor(s). Any and all client advertisers of the Company
(including their subsidiaries and affiliates), including, without limitation,
advertisers whose commercial material is to be, is or was incorporated in any
one or more of the Company's programs or announcements, live or recorded,
broadcast over the facilities of the Company, by the Company, or pursuant to an
arrangement with a Corporate Affiliate.
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15. No Waiver. No failure or delay on the part of any party in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy hereunder.
16. Successors and Assigns. This Agreement shall inure to the
benefit of and the successors and assigns of the Company. The Company may assign
its rights under this Agreement in connection with any sale, transfer of other
disposition of all or a substantial portion of the stock or assets of the
Company. Employee may not assign his duties or obligations hereunder, but this
Agreement shall be enforceable against Employee's successors and legal
representatives to the extent of any violation hereof by Employee.
17. 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 cable,
telegram, confirmed facsimile or telex, or by first class mail (postage prepaid,
return receipt requested), to the other party as follows:
if to the Company to: Westwood One, Inc.
9540 Washington Boulevard
Culver City, California 90232
Attention: Joel Hollander
Facsimile: (310) 840-4059
with a copy to: Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Attention: Howard Chatzinoff, Esq.
Facsimile: (212) 310-8007
if to Employee to: Charles Bortnick
c/o Metro Networks, Inc.
2800 Post Oak Blvd.
Suite 4000
Houston, Texas 77056
Facsimile: (713) 407-6049
with a copy to: Neil A. Torpey, Esq.
Paul, Hastings, Janofsky & Walker LLP
399 Park Avenue
New York, New York 10022
Facsimile: (212) 319-4090
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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.
18. Severability. If any term or other provision of this
Agreement is invalid, illegal or unenforceable, all other provisions of this
Agreement shall remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.
19. 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.
20. Governing Law. This Agreement shall be instituted and
enforced in accordance with, and governed by, the laws of the State of New York
applicable to contracts to be made, executed, delivered and performed wholly
within such state and, in any case, without regard to the conflicts of law
principles and policies of such state.
21. Waiver of Rights and Consent to Arbitration. Employee
shall and does hereby irrevocably waive the right to file any complaints against
the Company with any federal, state or local agencies, including but not limited
to, the Equal Employment Opportunity Commission, and any state Commission on
Human Rights or to file any claim, institute litigation or other legal action
based on the employment relationship or any activity covered by the terms of
this agreement. Employee agrees and acknowledges that in exchange for the
relinquishment of those rights that any dispute, controversy or claim arising
out of this Agreement, or the employment relationship between Employee and the
Company, except for equitable relief sought by the Company in aid of
arbitration, shall be finally settled by arbitration in the State of New York in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association in effect on the date of this Agreement and judgment upon the award
may be entered in any court having jurisdiction thereof.
22. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be original but all of which
shall constitute one and the same agreement.
23. Entire Agreement. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter hereof.
24. Execution by Company. Submission of this Agreement to
Employee, or Employee's agents or attorneys, for examination or signature does
not constitute or imply an offer of employment, and this Agreement shall have no
binding effect until execution hereof by both the Company and Employee.
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25. No Inference Against Author. No provision of this Agreement shall be
interpreted against any party because such party or its legal representative
drafted such provision.
[SIGNATURES BEGIN ON NEXT PAGE]
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SIGNATURE PAGE TO EMPLOYMENT AGREEMENT
IN WITNESS WHEREOF, the parties hereto have executed this
Employment Agreement as of the day and year first written above.
WESTWOOD ONE, INC.
By: /s/ Farid Suleman
---------------------------------
Name: Farid Suleman
Title: Executive Vice President,
Chief Financial Officer
and Secretary
/s/ Charles I. Bortnick
-------------------------------------
CHARLES I. BORTNICK
Exhibit 5
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of June 1, 1999 (this
"Agreement"), is entered into by and between SHANE COPPOLA ("Employee") and
WESTWOOD ONE, INC., a Delaware corporation (the "Company").
RECITALS:
WHEREAS, the Company is in the business of managing a sales
force, selling broadcast and other advertising, and developing, producing and
broadcasting traffic, news, sports, weather and other information reports
throughout the United States; and
WHEREAS, Employee has extensive management, marketing and
operations experience; and
WHEREAS, the Company desires to engage the services of
Employee to serve as an Executive Vice President of the Company's Metro/Shadow
operations ("Metro/Shadow") on the terms and conditions herein contained; and
NOW, THEREFORE, for and in consideration of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:
1. Employment. The Company hereby engages and employs
Employee, and Employee accepts such employment, to render such services to the
Company as Executive Vice President of Metro/Shadow as are customarily rendered
by and required by such a position, and Employee agrees to devote Employee's
full time and efforts to the interests of the Company upon the terms and
conditions hereinafter set forth.
2. Term of Employment. Subject to the provisions for
termination hereinafter provided, Employee's term of employment by the Company
shall commence at the Effective Time (as defined in the Agreement and Plan of
Merger, dated as of June 1, 1999, by and among the Company, Metro Networks, Inc.
and Copter Acquisition Corp. (the "Effective Date"), and shall continue in
effect until the later of (i) twenty-four (24) months from the Effective Date
and (ii) December 31, 2001 (the "Term"). Unless otherwise terminated pursuant
hereto, if Employee continues to be employed by the Company after the Term, then
Employee's employment shall be deemed to continue on a month-to-month basis
until such time as either party shall deliver written notice to the other party
and this Agreement shall terminate ninety (90) days after the giving of such
notice. Except as otherwise set forth herein, if either party hereto desires to
terminate this Agreement at the end of the Term or thereafter, the same ninety
(90) days prior written notice shall apply. The period from the Effective Date
through the date ninety (90) days from the date any notice of termination
referred to above is delivered is hereinafter referred to as the "Employment
Period". Unless otherwise terminated pursuant to Section 7, if the Company
terminates Employee's
NY2:\522779\07\B7DN07!.DOC\80764.0005
<PAGE>
employment at the end of the Term or anytime thereafter, or the parties are
unable to agree on the terms of a new agreement at the end of the Term and
Employee terminates his employment, the Company shall pay Employee the
equivalent of his monthly Base Salary (as defined herein) for ninety (90) days
following the end of Employee's employment.
3. Services to be Rendered by Employee.
(a) During the Employment Period, Employee shall serve as an
Executive Vice President of Metro/Shadow. Employee shall perform such executive
duties as from time to time may be delegated to Employee by such parties.
Employee shall devote all of Employee's professional time, energy and ability to
the proper and efficient conduct of the Company's business. Employee shall
observe and comply with all reasonable lawful directions and instructions by and
on the part of the Chief Executive Officer or President, the Board of Directors
of the Company (the "Board of Directors") or their designees, and endeavor to
promote the interests of the Company and not at any time do anything which may
cause or tend to be likely to cause any loss or damage to the Company in
business, reputation or otherwise.
(b) The Company may from time to time call on Employee to
perform services related to the business of developing and broadcasting traffic,
news, sports and weather reports, which may include (in the Company's sole
discretion) contributing to the day-to-day management and operation of such
business, soliciting Sponsors, Corporate Affiliates (as such terms are defined
in Section 14 hereof) or customers or dealing with their accounts, or the
television or radio broadcast of traffic, news, sports and weather reports, or
other activities related to the Company's business, as reasonably specified from
time to time by the Chief Executive Officer, the President, the Board of
Directors or their designees. The Company shall not relocate Employee to another
city without Employee's prior consent.
(c) Employee acknowledges that the Company does not allow
personal trade.
4. Compensation.
(a) Base Salary. For the services to be rendered by Employee
during Employee's employment by the Company, the Company shall pay Employee, and
Employee agrees to accept, a base salary (the "Base Salary") of $250,000 for
year one and $275,000 for year two, in each case payable in accordance with the
Company's standard payroll procedures.
(b) Bonus. Employee shall be eligible for a potential cash
bonus of $125,000 for year one and $150,000 for year two, in each case based on
achieving cash flow objectives established by the Chief Executive Officer, which
objectives may be modified by the Chief Executive Officer based on changes in
facts or circumstances in his/her reasonable discretion.
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(c) Options. Employee will be granted options, at the then
current market price on the date of grant, under the Company's 1999 Stock Option
Plan to purchase seventy-five thousand (75,000) shares, of the Company's common
stock, par value $.01 per share, on each of the Effective Date and the first
anniversary of the Effective Date. The option agreement relating to such options
shall provide that such options shall vest ratably over 5 years, provided,
however, that vesting will be accelerated if employee is terminated without
cause (for purposes of this Agreement, termination for cause shall be limited to
termination pursuant to Sections 7(a)(i), (ii), (iv), and (v) hereof), or if
this Agreement is not renewed on terms substantially similar to this Agreement,
excluding the annual grant of stock options.
5. Expenses. Upon submission of all necessary properly
completed expense reports requested by the Company, the Company shall reimburse
Employee, or cause Employee to be reimbursed, in cash for all reasonable,
receipt-supported, business expenses incurred by Employee in accordance with the
Company's policies in effect from time to time.
6. Benefits.
(a) Company Plans; Insurance. During the Term, Employee shall
receive all the benefits currently available to comparable level employees of
the Company. Employee recognizes the right of the Company to change, amend or
terminate any of the afore-mentioned employee benefit programs at any time.
(b) Vacation. Employee shall be entitled to vacation time in
accordance with the Company's employee handbook. Such vacation time may only be
used subject to reasonable approval by the Chief Executive Officer of the
Company.
(c) Years of Service. For purposes of determining years of
service, Employee shall be given credit for years of service at Metro/Shadow and
its subsidiaries.
7. Termination of Employment; Suspension.
(a) During the Employment Period, the Company shall have the
right, to terminate the employment of Employee hereunder immediately with or
without notice thereof to Employee in the event of any of the following:
(i) if Employee has (A) willfully failed, refused or
habitually has neglected to carry out or to perform the reasonable duties
required of Employee hereunder or otherwise breached any material provision of
this Agreement (other than Sections 8 and 13 hereof, which are governed by
Section 7(a)(iv) hereof), after ten (10) days prior written notice from the
Chief Executive Officer, the President or the Board of Directors of such failure
or neglect and the failure or neglect remains unremedied following such ten (10)
days period, or (B) willfully breached any statutory or common law duty;
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<PAGE>
(ii) if Employee is convicted of a felony or a crime involving
moral turpitude or if the Company, acting in good faith and upon reasonable
grounds, determines that Employee has willfully engaged in conduct which would
injure the reputation of the Company or otherwise adversely affect its interest
if Employee were retained as an employee of the Company;
(iii) if Employee becomes unable by reason of physical
disability or other incapacity (as may be defined in applicable disability
insurance policies) to carry out or to perform the duties required of Employee
hereunder for a continuous period of ninety (90) days; provided, however, that
Employee's compensation during any period in which Employee is unable to perform
the duties required of Employee hereunder shall be reduced in accordance with
the Company's policies and by any disability payments (excluding any
reimbursements for medical expenses and the like) which Employee is entitled to
receive under group or other disability insurance policies of the Company during
such period;
(iv) if Employee breaches any of the provisions of Section 8
or 13 hereof or breaches any of the terms or obligations of any other
noncompetition and/or confidentiality agreements entered into between Employee
and the Company, or the Company Group (as hereinafter defined), if any; or
(v) if employee steals or embezzles assets of the Company.
(b) Employee's employment with the Company shall automatically
terminate (without notice to Employee's estate) upon the death or loss of legal
capacity of Employee.
(c) If Employee willfully fails to perform in any material
respect any of the obligations set forth in this Agreement, or in the event of
any willful breach by Employee of any representation, warranty, term, obligation
or condition of this Agreement, the Company shall have the right, at its sole
option, in addition to the rights set forth in this Agreement or any other
rights at law or in equity, to discipline Employee, by suspension from work,
and/or suspension of or reduction in pay.
(d) In the event of any termination of employment pursuant to
this Section 7, Employee (or Employee's estate, as the case may be) shall be
entitled to receive (i) the Base Salary herein provided prorated to the date of
such termination, (ii) Employee's present entitlement, if any, under the
Company's employee benefit plans and programs and (iii) no other compensation.
8. Confidentiality; Non-Competition; Non-Solicitation.
(a) Employee recognizes and acknowledges that he has had
access to certain information of members of the Company Group (as hereinafter
defined) and that such information is confidential and constitutes valuable,
special and unique property of such members of the Company Group. Employee shall
not, directly or indirectly, at any time after the Effective Date, disclose,
4
<PAGE>
divulge, publish or otherwise communicate to anyone, nor retain, copy or permit
to be copied, or make use of for personal purposes or for the benefit of any
person, firm, corporation or other entity (other than the Company Group) any
Confidential Information (as defined below) of any member of the Company Group
(regardless of whether developed by such party) without the prior written
consent of the Company.
As used herein, "Company Group" means the Company and its
subsidiaries, and any entity that directly or indirectly controls, is controlled
by, or is under common control with, the Company and its subsidiaries. For
purposes of this definition, "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such entity, whether through the ownership of voting securities, by
contract or otherwise.
(b) The term "Confidential Information" with respect to any
person means any trade secrets and any other secret or confidential information
or knowledge and shall include, but shall not be limited to, (i) the plans,
methods, costs, prices, uses and applications of products and services relating
to the Business (as hereinafter defined), (ii) results of investigations,
studies or research relating to the Business, (iii) information relating to
employees, agents, broadcasters, customers, suppliers and advertisers of the
Business, (iv) all products, processes, compositions, samples, formulae,
computer programs and information systems relating to the Business, (v) all
servicing, marketing, programming or business methods and techniques relating to
the Business and (vi) all business plans, financial matters and all information
relating to mergers and acquisitions relating to the Business, in all such cases
before or during the term of this Agreement, that are not available to the
public or that are maintained as confidential by any member of the Company
Group.
(c) During the Term of this Agreement and for a period of one
year thereafter, without the prior written consent of the Company, Employee
shall not, and shall not permit any person or entity who or which Employee
controls (as defined above) to, within the United States (the "Territory"),
engage directly or indirectly in the Business (other than engaging in such
businesses pursuant to Employee's employment or consultation with, participation
in the management of, or ownership of securities in, the Company Group). For
purposes of this Agreement, "Business" shall mean the businesses of the Company
(as now conducted or contemplated to be conducted) including without limitation,
the businesses of (i) providing traffic reporting services, however distributed,
including, without limitation, to television and radio stations, Internet
service providers and any other person or entity who or which may distribute
such services or information through any media, now existing or hereafter
available or (ii) providing local news, sports or weather reporting to radio
stations. Employee shall be deemed to engage in the Business if Employee,
directly or indirectly (including, without limitation, through any person or
entity who or which Employee controls), engages or invests in, owns, manages,
operates, controls or participates in the ownership, management, operation or
control of, is employed by, provides financial support, or renders services or
advice to, any business engaged in the Business; provided, however, that (x)
Employee or such person or entity may invest in the securities of any enterprise
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<PAGE>
(but without otherwise participating in the activities of such enterprise) if
(1) such securities are listed on any national or regional securities exchange
or have been registered under Section 12(g) of the Securities Exchange Act of
1934, as amended and (2) Employee does not beneficially own (as defined Rule
13d-3 promulgated under the Securities Exchange Act of 1934, as amended) 5% or
more of the outstanding equity of such enterprise and (y) Employee shall not be
deemed to engage in the Business as a result of his employment with a business
so engaged so long as the responsibilities and activities with respect to his
employment are not related, directly or indirectly, in any material respect to
the conduct by such business of its Business.
(d) During the Term of this Agreement and for a period of one
year thereafter, Employee shall not, directly or indirectly, request, induce,
attempt to influence or have any other business contact with any employee,
officer, agent or consultant of any member of the Company Group or any talent
providing services to the Company Group, to terminate his or her relationship
with such member of the Company Group. Notwithstanding the foregoing, Employee
shall not be prohibited from hiring (for purposes unrelated to the Business)
Gary L. Worobow; provided, however, that (i) Mr. Worobow's employment agreement
with the applicable member of the Company Group shall have expired (and not been
renewed or extended), (ii) Mr. Worobow shall have been terminated without cause
by the applicable member of the Company Group or (iii) Mr. Worobow shall have
voluntarily left the employment of the applicable member of the Company Group at
the conclusion of the Term (as defined in Mr. Worobow's employment agreement
with such member of the Company Group).
9. Enforceabilitv. Employee agrees that if a court of
competent jurisdiction determines that the length of time or any other
restriction, or portion thereof, set forth in this Agreement is overly
restrictive and unenforceable, the court may reduce or modify such restrictions
to those which it deems reasonable and enforceable under the circumstances, and
as so reduced or modified, the parties hereto agree that the restrictions of
this Agreement shall remain in full force and effect. Employee further agrees
that if a court of competent jurisdiction determines that any provision of this
Agreement is invalid or against public policy, the remaining provisions of this
Agreement and the remainder of this Agreement shall not be affected thereby, and
shall remain in full force and effect. Employee acknowledges that the
restrictions imposed by the Agreement are legitimate, reasonable and necessary
to protect the Company Group's investment in its businesses and the goodwill
thereof. Employee acknowledges that the scope and duration of the restrictions
contained herein are reasonable in light of the time that Employee has been
engaged in the Business, Employee's reputation in the markets for the Business
and Employee's relationship with the suppliers, customers, advertisers and
clients of the Company Group. Employee further acknowledges that the
restrictions contained herein are not burdensome to Employee in light of the
consideration paid therefor and the other opportunities that remain open to
Employee.
10. Remedies. Employee acknowledges that money damages or
other remedy at law would not be a sufficient or adequate remedy for any breach
or violation of, or default under, this Agreement, but Employee agrees that in
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<PAGE>
addition to all other remedies available to the other parties hereto, such other
parties shall be entitled to the fullest extent permitted by law to an
injunction restraining such breach, violation or default or threatened breach,
violation or default and to any other equitable relief, including, without
limitation, restraining orders, injunctive relief and specific performance,
without the posting of a bond or other security interest being required.
11. Advertising and Publicity. Employee hereby grants the
Company the royalty-free right to use and license others to use Employee's name,
nickname, recorded voice, biographical material, portraits, pictures, and
likenesses for advertising purposes and purposes of trade, promotion and
publicity in connection with the institutions, services and products for the
Company Group, Sponsors and Corporate Affiliates, such uses to be at such times,
in such manner and through such media as the Company may in its sole discretion
determine. Such right shall last for so long as Employee is employed by the
Company and, in connection with the use or exploitation of any material in which
Employee has been involved during Employee's employment, perpetually thereafter.
Employee shall not authorize or release any advertising or promotional matter or
publicity in any form with reference to Employee's services hereunder, or to the
Company Group's programs, Sponsors or Corporate Affiliates, without the
Company's prior written consent.
12. Work for Hire. Employee agrees that any ideas, concepts,
techniques, or computer programs relating to the business or operations of the
Company Group which are developed by Employee during Employee's employment
hereunder, including each program and announcement prepared for broadcast, and
the titles, content, format, idea, theme, script, characteristics, and other
attributes thereof, shall be deemed to have been made within the scope of
Employee's employment and therefore constitute works for hire and shall
automatically upon their creation become the exclusive property of the Company.
To the extent such items are not works for hire under applicable law, Employee
assigns them and any and all intangible proprietary rights relating thereto to
the Company in their entirety and agrees to execute any and all documents
necessary or desired by the Company to reflect the Company's ownership thereof.
13. Communications Act of 1934. Employee represents and
warrants that neither Employee nor, to the best of Employee's knowledge,
information and belief, any other person, has accepted or agreed to accept, or
has paid or provided or agreed to pay or provide, any money, service or any
other valuable consideration, as defined in Section 507 of the Communications
Act of 1934, as amended, for the broadcast of any matter contained in programs.
Employee further represents and warrants that, during Employee's employment,
Employee shall comply with all legal requirements.
14. Certain Definitions. As used in this Agreement, the
following capitalized terms shall have the meanings indicated:
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(a) Corporate Affiliates. Any organization, entity or person
with whom the Company has or had a contract or other arrangement to provide
traffic, news, weather, sports or other information, whether by broadcast,
computer or any other means.
(b) Sponsor(s). Any and all client advertisers of the Company
(including their subsidiaries and affiliates), including, without limitation,
advertisers whose commercial material is to be, is or was incorporated in any
one or more of the Company's programs or announcements, live or recorded,
broadcast over the facilities of the Company, by the Company, or pursuant to an
arrangement with a Corporate Affiliate.
15. No Waiver. No failure or delay on the part of any party in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy hereunder.
16. Successors and Assigns. This Agreement shall inure to the
benefit of and the successors and assigns of the Company. The Company may assign
its rights under this Agreement in connection with any sale, transfer of other
disposition of all or a substantial portion of the stock or assets of the
Company. Employee may not assign his duties or obligations hereunder, but this
Agreement shall be enforceable against Employee's successors and legal
representatives to the extent of any violation hereof by Employee.
17. 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 cable,
telegram, confirmed facsimile or telex, or by first class mail (postage prepaid,
return receipt requested), to the other party as follows:
if to the Company to: Westwood One, Inc.
9540 Washington Boulevard
Culver City, California 90232
Attention: Joel Hollander
Facsimile: (310) 840-4059
with a copy to: Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Attention: Howard Chatzinoff, Esq.
Facsimile: (212) 310-8007
if to Employee to: Shane Coppola
c/o Metro Networks, Inc.
681 Fifth Avenue, 10th Floor
New York, New York 10022
Facsimile: (212) 750-5393
with a copy to: Neil A. Torpey, Esq.
Paul, Hastings, Janofsky & Walker LLP
399 Park Avenue
New York, New York 10022
Facsimile: (212) 319-4090
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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.
18. Severability. If any term or other provision of this
Agreement is invalid, illegal or unenforceable, all other provisions of this
Agreement shall remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.
19. 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.
20. Governing Law. This Agreement shall be instituted and
enforced in accordance with, and governed by, the laws of the State of New York
applicable to contracts to be made, executed, delivered and performed wholly
within such state and, in any case, without regard to the conflicts of law
principles and policies of such state.
21. Waiver of Rights and Consent to Arbitration. Employee
shall and does hereby irrevocably waive the right to file any complaints against
the Company with any federal, state or local agencies, including but not limited
to, the Equal Employment Opportunity Commission, and any state Commission on
Human Rights or to file any claim, institute litigation or other legal action
based on the employment relationship or any activity covered by the terms of
this agreement. Employee agrees and acknowledges that in exchange for the
relinquishment of those rights that any dispute, controversy or claim arising
out of this Agreement, or the employment relationship between Employee and the
Company, except for equitable relief sought by the Company in aid of
arbitration, shall be finally settled by arbitration in the State of New York in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association in effect on the date of this Agreement and judgment upon the award
may be entered in any court having jurisdiction thereof.
22. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be original but all of which
shall constitute one and the same agreement.
23. Entire Agreement. This Agreement constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter hereof.
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24. Execution by Company. Submission of this Agreement to
Employee, or Employee's agents or attorneys, for examination or signature does
not constitute or imply an offer of employment, and this Agreement shall have no
binding effect until execution hereof by both the Company and Employee.
25. No Inference Against Author. No provision of this
Agreement shall be interpreted against any party because such party or its legal
representative drafted such provision.
[SIGNATURES BEGIN ON NEXT PAGE]
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SIGNATURE PAGE TO EMPLOYMENT AGREEMENT
IN WITNESS WHEREOF, the parties hereto have executed this
Employment Agreement as of the day and year first written above.
WESTWOOD ONE, INC.
By: /s/ Farid Suleman
---------------------------------
Name: Farid Suleman
Title: Executive Vice President,
Chief Financial Officer
and Secretary
/s/ Shane Coppola
-------------------------------------
SHANE COPPOLA
