<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
INFINITY BROADCASTING CORPORATION
_______________________________________________________________________________
(Name of Registrant as Specified In Its Charter)
INFINITY BROADCASTING CORPORATION
_______________________________________________________________________________
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[x] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
___________________________________________________________________
2) Aggregate number of securities to which transaction applies:
___________________________________________________________________
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:(1)
___________________________________________________________________
4) Proposed maximum aggregate value of transaction:
___________________________________________________________________
(1) Set forth the amount on which the filing fee is calculated and state
how it was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
______________________________________________
2) Form, Schedule or Registration Statement No:
______________________________________________
3) Filing Party:
<PAGE>
INFINITY BROADCASTING CORPORATION
600 Madison Avenue
New York, New York 10022
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
__________________
The Annual Meeting of Stockholders of Infinity Broadcasting
Corporation (the "Company") will be held at the St. Moritz Hotel, 50
Central Park South, New York, New York 10019, on June 13, 1994, at 10:00
a.m. Eastern Time, for the following purposes:
1. To elect directors for the ensuing year;
2. To vote upon the ratification of the appointment of independent
auditors for 1994;
3. To vote upon a proposal to amend to the Company's Stock Option
Plan to increase the number of shares of the Company's Common
Stock as to which Options may be granted under the Plan and to
further amend the Plan in certain respects to facilitate the
deductibility by the Company for Federal income tax purposes
of certain compensation payable thereunder;
4. To vote upon a proposal to adopt a Cash Bonus Compensation
Plan permitting certain awards in connection with the achievement of
annual corporate performance goals, which is designated to facilitate
the deductibility by the Company for federal income tax purposes of
performance-based cash bonus incentive compensation;
5. To vote upon a proposal to approve certain provisions of the amended
employment agreement between the Company and its Chief Executive
Officer, which are designed to facilitate the deductibility by the
Company for federal income tax purposes of cash and equity based
incentive compensation payable thereunder; and
6. To transact such other business as may properly come before
the meeting.
Only stockholders of record as of the close of business on
April 25, 1994, will be entitled to notice of and to vote at the meeting
and any adjournments. Whether or not you plan to attend the meeting,
stockholders are requested to date, sign, and return the enclosed proxy
card in the return envelope furnished for your convenience. No postage
is required if mailed within the United States.
A copy of the Company's Annual Report on Form 10-K for the
year ended December 31, 1993, which report contains consolidated finan-
cial statements and other information of interest with respect to the
Company and its stockholders, is enclosed.
By Order of the Board of Directors,
_________________________________________
Michael A. Wiener
May 2, 1994 Chairman of the Board and Secretary
<PAGE>
INFINITY BROADCASTING CORPORATION
600 Madison Avenue
New York, New York 10022
__________________
PROXY STATEMENT
May 2, 1994
__________________
This Proxy Statement is furnished in connection with the
solicitation of proxies on behalf of the Board of Directors of Infinity
Broadcasting Corporation (the "Company") for use at the Annual Meeting
of Stockholders of the Company (the "Annual Meeting") to be held at the
St. Moritz Hotel, 50 Central Park South, New York, New York 10019, on
June 13, 1994, at 10:00 a.m. Eastern Time, and any adjournment thereof.
This Proxy Statement and the enclosed proxy form are scheduled to be
mailed to the stockholders commencing on May 2, 1994.
Holders of record of shares of any class of the Company's
common stock at the close of business on April 25, 1994 are entitled to
notice of and to vote at the Annual Meeting. The presence in person or
by proxy of the holders of a majority of the combined voting power of
the issued and outstanding shares entitled to vote shall constitute a
quorum. Abstentions and broker non-votes (that is, shares held for
customers of a broker but not voted because of a lack of instructions
from the broker's customers) will be counted for purposes of determining
the presence or absence of a quorum for the transaction of business. As
of the close of business on April 25, 1994, 28,485,616 shares of Class A
Common Stock, par value $.002 per share (the "Class A Shares"), 3,990,621
shares of Class B Common Stock, par value $.002 per share (the "Class B
Shares"), and 496,114 shares of Class C Common Stock, par value $.002
per share (the "Class C Shares" and, together with the Class A Shares
and the Class B Shares, the "Common Stock"), were issued and
outstanding.
Effective August 9, 1993, the Company declared a three-for-two
stock split in the form of a stock dividend payable on August 16, 1993
to shareholders of record at the close of business on August 9, 1993.
Effective November 12, 1993, the Company declared another three-for-two
stock split in the form of stock dividend payable on November 19, 1993
to shareholders of record at the close of business on November 12, 1993.
All Common Stock amounts and values have been adjusted to reflect the
effect of the stock dividends.
Under the Company's Restated Certificate of Incorporation, in
the election of directors, the holders of the Class A Shares are
entitled by class vote, exclusive of all other stockholders, to elect
two of the Company's directors, with each Class A Share being entitled
to one vote. In addition, the holders of the Class C Shares are
entitled by class vote, exclusive of all other stockholders, to elect
two of the Company's directors, with each Class C Share being entitled
to one vote. With respect to the election of the other five directors
and other matters submitted to the stockholders for vote, the holders of
all classes of the Common Stock shall vote as a single class,
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<PAGE>
with each Class A Share and each Class C Share being entitled to one
vote and each Class B Share being entitled to ten votes.
Shares represented by a proxy in the enclosed form of proxy,
unless previously revoked, will be voted at the meeting if the proxy is
executed and returned to the Company in sufficient time to permit the
necessary examination and tabulation of the proxy before a vote is
taken. The form of proxy permits a specification as to whether or not
shares represented by the proxy are to be voted for the election of all
nominees for director or are to be withheld from certain nominees for
director. The form of proxy divides the nominees into groups to be
voted upon (1) by the holders of the Class A Shares, (2) by the holders
of the Class C Shares and (3) by the holders of all classes of Common
Stock. A separate specification is provided for each such group of
nominees. Only the Class A Shares are publicly traded. The Class B
Shares are held solely by Mel Karmazin, Michael A. Wiener and Gerald
Carrus and their "affiliates", as defined in the Company's Restated
Certificate of Incorporation. The Class C Shares are held solely by
certain merchant banking partnerships (the "Lehman Investors")
affiliated with Lehman Brothers Inc. ("Lehman Brothers").
The form of proxy also permits the specification of approval,
disapproval or abstention as to the proposal to ratify KPMG Peat Marwick
as the independent certified public accountants to audit the Company's
books and records for the year ending on December 31, 1994. The form of
proxy also permits the specification of approval, disapproval or
abstention as to (i) the proposal to amend the Company's Stock Option
Plan (the "Option Plan") in certain respects, (ii) the proposal to
approve the Infinity Broadcasting Corporation Cash Bonus Compensation
Plan (the "Bonus Plan"), and (iii) the proposal to approve certain
provisions of the amended employment agreement between the Company and
its Chief Executive Officer. The holders of all classes of Common Stock
are entitled to vote upon the proposals to ratify KPMG Peat Marwick's
appointment, to amend the Option Plan, to approve the Bonus Plan, and to
approve the amended provisions of the Chief Executive Officer's
employment agreement.
The shares represented by all valid proxies received will be
voted in the manner specified on the proxies. Where specific choices
are not indicated, the shares represented by all valid proxies received
shall be voted (1) for the nominees for director named in this Proxy
Statement, (2) for ratification of the appointment of KPMG Peat Marwick
as the Company's independent public accountants, (3) for approval of the
amendments to the Option Plan, (4) for approval of the Bonus Plan, and
(5) for approval of the amended provisions of the Chief Executive
Officer's employment agreement. If a completed form of proxy is
returned and specifies a vote for or against nominees to be elected by a
holder of a class of shares not held by the person executing such proxy,
the improper specification will be disregarded. In all other respects,
however, the shares represented by such proxy will be voted as specified
on the form of proxy, or, in the absence of further specification, as
noted in this paragraph.
A stockholder who gives a proxy may revoke it at any time
before it is exercised, by written notice to the Secretary or by voting
in person at the Annual Meeting.
Management knows of no other matter to be presented at the
meeting. If any other matter should be presented at the meeting upon
which a vote properly may be taken other than for the election of
directors, it is intended that shares represented by proxies in the
accompanying form will be voted with respect thereto in accordance with
the judgment of the person or persons voting
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<PAGE>
such shares. Michael A. Wiener and Gerald Carrus, or either of them,
each with full power of substitution, have been designated as proxies to
vote the shares solicited hereby.
ELECTION OF DIRECTORS
The Board of Directors has nominated the nine incumbent
directors named below for election as directors at the Annual Meeting,
each to hold office until the annual meeting of stockholders to be held
in 1995 and until his successor has been elected and has qualified. It
is intended that shares represented by proxies in the accompanying form
will be voted for the election of all of the nominees named in the
following pages, unless a contrary direction is indicated.
If any of the nominees should not be available for election,
shares represented by proxies in the accompanying form will be voted for
such other person as the management of the Company may select. The
Board has no reason to believe that any nominee named below will be
unavailable for election.
Nominees for election to the Board of Directors shall be approved
by the following vote:
* For nominees to be elected by the holders of the Class A
Shares: by a plurality of the votes cast by holders of Class
A Shares present in person or by proxy at the meeting, with
each share being entitled to one vote.
* For nominees to be elected by the holders of the Class C
Shares: by a plurality of the votes cast by holders of Class
C Shares present in person or by proxy at the meeting, with
each share being entitled to one vote.
* For nominees to be elected by the holders of all classes of
Common Stock: by a plurality of the votes cast by holders of
all classes of Common Stock present in person or by proxy at
the meeting, with each Class A Share and each Class C Share
being entitled to one vote and each Class B Share being entitled
to ten votes.
Abstentions from voting on the election of directors, including
broker non-votes, will have no effect on the outcome of the election of
directors.
The Board of Directors recommends a vote "FOR" the election of all of
the nominees named below.
The following biographical and employment information with respect
to the nominees for election as directors has been furnished to the Company
by such nominees. Except as indicated, each of the nominees has had the same
principal occupation for the last five years. Each of the nominees was elected
to his present term of office at the last Annual Meeting of Stockholders.
Nominees to be elected by the holders of all classes of the Common Stock:
_________________________________________________________________________
Michael A. Wiener Age 56 Director since 1972
Mr. Wiener currently is Chairman of the Board of Directors and
Secretary of the Company and has held these offices since 1979.
Mr. Wiener is also a director of
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<PAGE>
Ensemble Music, Inc., The Wiener Foundation, The Day School (as
Trustee) and the Samuel Waxman Cancer Research Foundation.
Gerald Carrus Age 68 Director since 1979
Mr. Carrus is Co-Chairman of the Board of Directors and
Treasurer of the Company and has held these offices since mid-1988.
He was President and Treasurer of the Company from 1979 until
mid-1988. Mr. Carrus is also a director of Cronin Fasteners, Inc.
Mel Karmazin Age 50 Director since 1984
Mr. Karmazin is President and Chief Executive Officer of the
Company and has held these offices since mid-1988. He was Executive
Vice President of the Company from 1981 until mid-1988. Mr. Karmazin
has also been a director of Westwood One Inc. since February 1994.
Farid Suleman Age 42 Director since February 1992
Mr. Suleman is Vice President-Finance and Chief Financial Officer
of the Company and has held these offices since 1986. He also
has been a director of Westwood One, Inc. since February 1994.
Steven A. Lerman Age 47 Director since February 1992
Mr. Lerman has been a partner in the Washington, D.C. law firm
of Leventhal, Senter & Lerman since 1986. He and his firm regularly
serve as outside counsel to the Company with respect to certain
matters, particularly regulatory matters before the Federal
Communications Commission. Mr. Lerman also is a director of
Premiere Radio Networks, Inc.
Nominees to be elected by the holders of the Class A Shares:
____________________________________________________________
Alan R. Batkin Age 49 Director since April 1992
Mr. Batkin is Vice Chairman of Kissinger Associates, Inc., a
privately held firm that provides strategic geopolitical advice
to a broad range of corporate clients. Mr. Batkin has been
with Kissinger Associates since 1990. He served as a Managing
Director of Lehman Brothers from 1976 to 1990. He is also a
director of Hasbro, Inc.
Orenthal J. ("O.J.") Simpson Age 46 Director since April 1992
Mr. Simpson is a nationally known former football star and
Heisman Trophy winner, and a member of the Professional and College
Football Halls of Fame. He has been involved as a network television
sports commentator and media personality for almost 20 years (beginning
before his retirement from pro football in 1978). In addition to his
involvement as a producer of and star in numerous television projects,
he is regularly seen as the co-host of NBC's "NFL LIVE." Mr. Simpson
also is involved in the hotel, restaurant and real estate businesses.
He is a promotional spokesman for many national corporations and is a
director of Kushner-Locke Company, The Forschner Group, Inc., and
Cyrk, Inc.
4
<PAGE>
Nominees to be elected by the holders of the Class C Shares:
____________________________________________________________
James A. Stern Age 43 Director since 1990
Mr. Stern, since 1984, has been a Managing Director
of the Merchant Banking Group of Lehman Brothers, a division
of a subsidiary of Lehman Brothers Holdings Inc., a company
whose common stock is principally owned by American Express
Company. Since 1989, he also has headed the Merchant
Banking Group of Lehman Brothers. Mr. Stern is also a
director of K & F Industries, Inc., R.P. Scherer Corp., Noel
Group Inc. and Lear Seating Corporation.
James L. Singleton Age 38 Director since 1990
Mr. Singleton is a Managing Director of the Merchant Banking
Group of Lehman Brothers. From 1990 to 1992 he was a Senior
Vice President, and from 1987 to 1990 he was a Vice President,
of Lehman Brothers.
Effective April 29, 1994, Messrs. Stern and Singleton will leave
Lehman Brothers to start a new firm, The Cypress Group Inc., where they will
continue their merchant banking activities. Messrs. Stern and Singleton
will continue to serve as directors of Infinity.
Additional information about the current directors and officers
of the Company (which include all of the nominees for election to the
Board), including information with respect to their ownership of Common
Stock and their compensation, appears in the following sections of this
Proxy Statement.
BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors met four times in 1993. In 1993, each
of the current directors who was then in office, other than Messrs.
Simpson and Stern, attended all of the meetings of the Board of Directors
and all committees of the Board of Directors on which such director
served. Messrs. Simpson and Stern attended 75% of all of the meetings
of the Board of Directors.
The Board of Directors presently has standing Compensation and
Audit Committees. The Company has no nominating committee. In 1993,
the Compensation Committee, consisting of Messrs. Carrus and Wiener, was
responsible only for administering the Option Plan and certain awards
under the Company's Deferred Share Plan (the "Deferred Share Plan").
Under the proposed Bonus Plan, the amendments to the Option Plan, and
the amended provisions of the Chief Executive Officer's employment
agreement, as described below, the Compensation Committee will have sole
responsibility for setting corporate performance goals for 1994 and
later years in connection with the award of certain cash and
equity-based incentive compensation for executive officers, and for
determining amounts to be awarded upon the Company's achievement of such
goals. (See "Proposal to Approve Amendments to Option Plan," "Proposal
to Approve Cash Bonus Compensation Plan," and "Proposal to Approve
Certain Provisions of Mr. Karmazin's Amended Employment Agreement,"
below.) The Compensation Committee held one meeting and took four
actions by written consent in 1993.
The Company's Audit Committee consists of Messrs. Simpson and
Batkin. The functions of the Audit Committee are to review and report
to the Board of Directors with respect to the selection and the terms of
engagement of the Company's independent public accountants and to
maintain communications among the Board of Directors, such independent
public accountants and the Company's internal accounting staff with
respect to accounting and audit procedures, the
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<PAGE>
implementation of recommendations by such independent public
accountants, the adequacy of the Company's internal controls and related
matters. The Audit Committee met once in March 1994 to review, among
other things, the terms of the Company's engagement of KPMG Peat Marwick
as the Company's independent public accountants and the procedures,
internal controls and policies followed by the Company and KPMG Peat
Marwick in connection with audits of the Company's financial statements.
Directors of the Company do not receive compensation for their
services as such, except for Messrs. Simpson and Batkin. Each of them
receives an annual fee of $15,000 for serving as a director of the
Company. Each of them also received an award under the Option Plan in
July 1993, consisting of an option for the purchase of 22,500 Class A
Shares at an exercise price of $8.78 (the closing price, as reported on
the NASDAQ National Market System, of a Class A Share on September 15,
1992, the date on which the Chief Executive Officer recommended that the
Compensation Committee grant such awards to Messrs. Batkin and Simpson),
each option becomes exercisable in five cumulative annual installments
during the recipient's service as a Director of the Company and/or any
of its subsidiaries from and after September 15, 1992, and which will
(subject to certain conditions) remain exercisable for ten years from
the date of grant. In addition, each of Messrs. Batkin, Simpson and
Lerman, who are not employees of the Company, is reimbursed for reasonable
expenses associated with their attendance at meetings of the Board
and of all committees of the Board on which they serve.
COMPENSATION OF EXECUTIVE OFFICERS
The following table discloses compensation received by the
Company's Chief Executive Officer and the Company's three other
executive officers (the "named executive officers") for the three fiscal
years ended December 31, 1993.
<TABLE>
SUMMARY COMPENSATION TABLE
__________________________
<CAPTION>
Name and Principal Position Annual Compensation Long-Term Compensation
___________________________ ___________________ ______________________
Restricted
Stock All
Bonus Award(s) Options/ Other
Year Salary ($) ($) ($) SARs (#) Compensation
____ __________ _____ ___________ ________ ____________
<S> <C> <C> <C> <C> <C> <C>
Mel Karmazin, (1)..................... 1993 925,000 1,000,000 (2) 112,500 798 (3)
President, Chief Executive 1992 750,000 247,000 1,380 (3)
Officer and Director 1991 750,000 (4) *
Michael A. Wiener, (1)................ 1993 250,000 2,019 (3)
Chairman of the Board 1992 250,000 2,940 (3)
and Secretary 1991 250,000 *
Gerald Carrus, (1).................... 1993 250,000 3,712 (3)
Co-Chairman of the Board 1992 250,000 3,510 (3)
and Treasurer 1991 250,000 *
Farid Suleman,........................ 1993 298,230 300,000 161,250 0
Vice President of Finance, 1992 275,000 100,000 140,004 (5) 0
Chief Financial Officer 1991 275,000 *
and Director
6
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<FN>
Notes to Summary Compensation Table:
* Under the Securities and Exchange Commission's transition rules, no
disclosure is required.
(1) The annual base salary payable to each of Messrs. Karmazin, Wiener
and Carrus is governed by the terms of their respective employment
agreements with the Company. Mr. Karmazin's employment agreement
also provides for the payment to him of additional incentive compensation
under specified circumstances related to the Company's annual
financial performance. See "Compensation of Executive Officers --
Employment Agreements," and "Compensation of Executive Officers --
Report of the Board of Directors Concerning Executive Compensation,"
below.
(2) Amount shown represents a bonus payment that was made in 1993. Mr.
Karmazin received a bonus of $1 million in December 1993, in recognition
of his services and the Company's superior performance during the
Company's 1993 fiscal year, including services in connection with the
Company's acquisition of an interest in Unistar and Westwood One Inc.
The payment was made in 1993 rather than in 1994 to ensure that the
Company's ability to deduct the bonus for federal income tax purposes
would not be affected adversely by Section 162(m) of the Internal
Revenue Code of 1986, as amended ("Section 162(m)"), which became
effective with respect to the Company on January 1, 1994. See also
"Report on Executive Compensation" elsewhere in this Proxy Statement.
(3) Reported amounts represent premiums paid on whole life insurance
policies, the cash values of which are used by the Company solely to
pay premiums on the policies.
(4) Mr. Karmazin's employment agreement was amended in 1991 to permit
the Company to elect to pay any of his base compensation for 1991 in
Common Stock or warrants to purchase Common Stock. Pursuant to that
amendment, the Company elected to pay all of Mr. Karmazin's base
compensation for 1991 in the form of warrants to purchase Class A
Shares. Mr. Karmazin received warrants to purchase 140,625 Class A
Shares, at an exercise price of $.003 per Class A Share. These
warrants became exercisable in February 1992, upon the consummation
of the Company's 1992 initial public offering (the"IPO"), and Mr.
Karmazin exercised warrants for 108,186 Class A Shares at that time.
(5) The amount represents the fair value of 27,000 Class A Deferred
Shares, all of which were vested as of the date of grant, awarded to
Mr. Suleman in September 1991 under the Company's Deferred Share
Plan, which went into effect on September 10, 1990. The award was
made before the Company's Class A Shares were publicly traded. The
reported fair value was determined based on prices paid in a
contemporaneous transaction by other investors.
No Deferred Share award to any executive officer of the Company was
outstanding on December 31, 1993.
</TABLE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information, as required by
the rules of the Securities and Exchange Commission (the "SEC")
regarding stock options granted to the CEO and the named executive
officers during the Company's 1993 fiscal year. No stock appreciation
rights ("SARs") were granted to any employee of the Company in 1993.
The "Potential Realized Option Values" shown in the table below are the
result of calculations at the 0%, 5% and 10% rates set by the SEC and
therefore are not intended to forecast possible future appreciation of
the Company's stock price. The actual value, if any, that an optionee
will realize upon exercise of an option will depend on the excess of
the market value of the Common Stock on the date the option is exercised
over the exercise price. In all cases, the appreciation is calculated
from the award date to the end of the option term.
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<TABLE>
Option/SAR Grants in Last Fiscal Year
<CAPTION>
Potential Realized Value at Assumed Annual
Moves of Stock Price Appreciation for
Individual Grants Option Term
_________________
__________________________________________________________________________________________________________________
Number of % of Total
Securities Options/
Underlying SARs
Options/ Granted to
SARs Employees Exercise or
Granted in Fiscal Base Price Expiration
Name (#) (1) Year (1) ($/Sh) Date 0% ($) 5% ($) 10% ($)
__________________________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C> <C>
Mel Karmazin 112,500(2) 10.4 $9.26(3) 4/30/03 582,750 1,604,250 3,171,375
Farid Suleman 56,250(4) 5.2 $8.78(5) 6/30/03 524,812 1,165,500 2,148,185
67,500(6) 6.3 $7.78(5) 6/30/03 697,275 1,466,100 2,645,325
37,500(7) 3.5 $26.00 9/21/03 0 613,175 1,553,900
__________________________
<FN>
(1) No SARs have been granted to any employee of the
Company and therefore no information relating to SARs has
been reported on this Table .
(2) Represents award of option for the purchase of Class B
Shares, made in recognition of the Company's attainment of
its 1992 earnings target and in accordance with the
incentive compensation provisions of Mr. Karmazin's
employment agreement, which was exercisable immediately upon
grant. (See "Executive Compensation-Employment
Agreements," and "Proposal to Approve Amendments to Mr.
Karmazin's Employment Agreement", below.)
(3) Exercise price, which was set in accordance with the
incentive compensation provisions of Mr. Karmazin's
employment agreement, equals 85% of the closing price of a
Class A Share on December 31, 1992. The market price on the
date of grant was $14.44.
(4) Represents award of option for the purchase of Class A
Shares. The option becomes exercisable in five cumulative
annual installments during Mr. Suleman's continuous
employment with the Company and/or any of its subsidiaries
from and after September 15, 1992.
(5) Exercise price equals closing price, as reported on the
NASDAQ National Market System of a Class A Share on
the date on which the CEO recommended that the Compensation
Committee grant the option to Mr. Suleman. The market
price on the date of grant was $18.11.
(6) Represents award of option for the purchase of Class A
Shares. The option becomes exercisable in four cumulative
annual installments during Mr. Suleman's continuous
employment with the Company and/or its subsidiaries from and
after June 30, 1993.
(7) Represents award of option for the purchase of Class A
Shares. The option becomes exercisable in five cumulative
annual installments during Mr. Suleman's continuous
employment with the Company and/or its subsidiaries from and
after September 21, 1993.
</TABLE>
8
<PAGE>
Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End
Option/SAR Values
The following table provides information on option/SAR
exercises in the year ended December 31, 1993 by the Company's Chief
Executive Officer and the named executive officers, and the value of
each such officer's unexercised options/SARs at December 31, 1993.
<TABLE>
<CAPTION>
Number of Unexercised Value of Unexercised In-the-
Options/SARs at Fiscal Money Options/SARs at Fiscal
Year-End (#) (1) Year-End ($) (1) (2)
______________________ ____________________________
Shares
Acquired on Value
Name Exercise(#) Realized($) Exercisable Unexercisable Exercisable Unexercisable
____ ___________ ____________ ___________ _____________ ___________ _____________
<S> <C> <C> <C> <C> <C> <C>
Mel Karmazin........ 134,941(3) 1,795,622(4) 2,084,246(5) 0 61,954,825 0
Michael A. Wiener... 0 0 0 0 0 0
Gerald Carrus....... 0 0 0 0 0 0
Farid Suleman....... 0 0 86,250 150,000 2,500,290 2,642,250
<FN>
_________________________
Notes to Option/SAR Table:
(1) No SARs have been granted to any employee of the Company
and therefore no SAR exercises are reported in this Table.
(2) On December 31, 1993, the closing per share price of a Class A
Share on the NASDAQ National Market System was $30.25. The Class B
Shares are not publicly listed or traded and may not be held by any
persons other than Messrs. Karmazin, Wiener and Carrus and their
"affiliates," as defined in the Company's Restated Certificate of
Incorporation. Each Class B Share is freely convertible into one
Class A Share at the option of the holder, and a Class B Share
automatically converts into a Class A Share upon transfer to
any person not eligible to hold Class B Shares. For purposes
of this Table, the value of unexercised options to acquire Class B
Shares is reported as if Class A Shares would be received upon the
exercise of such options.
(3) The reported amount represents the exercise of options
to acquire 134,941 Class B Shares which were immediately
converted into shares of Class A Common Stock.
(4) The reported amount excludes the $.03 per share exercise
price of the 134,941 options exercised.
(5) The reported amount includes options to acquire 2,051,807
Class B Shares and warrants to acquire 32,439 Class
A Shares. See "Security Ownership of Certain Beneficial
Owners and Management," below.
</TABLE>
9
<PAGE>
Long-Term Incentive Plans -- Awards In Last Fiscal Year
During the year ended December 31, 1993, no awards were made
under any long-term incentive plan to the Company's Chief Executive
Officer or to any of the named executive officers.
Pension Plan
The Infinity Broadcasting Corporation Pension Plan (the
"Pension Plan") was frozen by the Company effective November 30, 1987.
As a result, after November 30, 1987, Participants (as such term is
defined in the Pension Plan) in the Pension Plan do not accrue
additional benefits under the Pension Plan, persons who were not
Participants prior to November 30, 1987 do not become Participants, and
the accrued benefits of all persons who were Participants as of such
date will be paid as and when they become due under the Pension Plan. A
Participant retiring at normal retirement age is entitled to a monthly
benefit in the straight life annuity form of 50% of his average monthly
compensation over the three years (prior to November 30, 1987) in which
such compensation was the highest, reduced by 74% of the Participant's
Social Security Benefit offset.
Benefits accrued under the Pension Plan as of November 1987
will be preserved for future distribution. The Company will continue to
contribute to the Pension Plan as required to satisfy the funding
requirements imposed by law.
Messrs. Wiener, Carrus and Karmazin are the only directors or
executive officers of the Company eligible to receive a monthly pension
under the terms of the frozen Pension Plan. Assuming retirement at
normal retirement age (age 65) and payment of benefits in the form of a
life annuity, Messrs. Wiener, Carrus and Karmazin would be entitled to
an estimated annual benefit under the frozen Pension Plan of
approximately $32,000, $66,000 and $17,000, respectively. At the time
the Pension Plan was frozen, Messrs. Wiener, Carrus and Karmazin had 9,
9, and 6 years of service credit under the Pension Plan, respectively.
Employment Agreements
Messrs. Wiener and Carrus have identical ten-year employment
agreements with the Company that took effect on December 31, 1985.
Under the terms of these agreements, Messrs. Wiener and Carrus will be
employed as senior executives of the Company until December 31, 1995.
Compensation for each of them under their respective agreements is
determined by the Company's Board of Directors, with a minimum annual
salary of $250,000 being guaranteed to each. The term of employment
under these agreements terminates upon the disability for six
consecutive months, or the death, of the contracting officer (a
"Termination Event"). Upon a Termination Event, the officer or his
estate is entitled to receive, through the year 2000, an annual payment
equal to 50% of the actual compensation earned by such officer in the
fiscal year prior to the year in which the Termination Event occurred.
In September 1990, the Company entered into a new employment
agreement with Mr. Karmazin, replacing an agreement with the Company
that was identical to the agreements with Messrs. Wiener and Carrus. Under
such new agreement, Mr. Karmazin is to be employed for a five-year term,
the expiration date of which is extended automatically by one year on each
anniversary of the original effective date of the agreement (an "Anniversary
Date") through the Anniversary Date following the year in which Mr.
Karmazin reaches age 61 (unless the agreement is terminated as provided
therein), as the Company's President and Chief Executive Officer (or any
10
<PAGE>
higher position to which the Board appoints Mr. Karmazin with his
consent). The agreement requires the Company to use its best efforts to
cause Mr. Karmazin to be a member of the Company's Board of Directors
throughout his employment under the agreement, and to include him in the
management slate for election as a director at every stockholders'
meeting at which his term as a director would otherwise expire.
Mr. Karmazin's minimum base compensation under his agreement
is $750,000 per year; a majority of the Board (including for this
purpose at least two-thirds of the members of the Board) (a "Majority")
may increase, but may not decrease, this amount. In addition, the
agreement provides for certain incentive compensation in the form of
cash, stock options and deferred shares. As set forth in the agreement,
such incentive compensation is payable if the Company's annual earnings
before interest, taxes, depreciation and amortization ("EBITDA") meets
or exceeds annual EBITDA targets set by agreement of the Board and Mr.
Karmazin. On March 30, 1994, the Board and Mr. Karmazin amended the
employment agreement, subject to stockholder approval, to provide that
EBITDA targets for 1994 and later years will be set by the Compensation
Committee. See "Proposal to Approve Certain Provisions of Mr.
Karmazin's Amended Employment Agreement," below.
In September 1991, Mr. Karmazin's employment agreement was
amended to permit the Company to elect to pay any of his base
compensation for 1991 in Common Stock or warrants to purchase Common
Stock. The Company elected to pay Mr. Karmazin's entire 1991 base
compensation in the form of warrants to purchase Class A Shares. See
the "Summary Compensation Table," above. Mr. Karmazin's employment
agreement was amended further in February 1992, in conjunction with
amendments to the Option Plan and the Deferred Share Plan that were
intended to facilitate those plans' ongoing compliance with certain
Exchange Act rules by, among other things, making all awards to
executive officers of the Company subject to the discretion of the
Compensation Committee. The 1992 amendment to Mr. Karmazin's
employment agreement provides for certain increased cash incentive
compensation in the event he is not awarded incentive compensation in
the form of stock options and deferred shares that is earned under the
employment agreement.
The agreement with Mr. Karmazin may be terminated at any time
by a majority of the Board of Directors or by Mr. Karmazin, either
without cause or for cause, upon notice. In the event the Company
terminates Mr. Karmazin's employment without cause (as defined in the
agreement) or in the event Mr. Karmazin terminates his employment for
good reason (as defined in the agreement), Mr. Karmazin is entitled to
receive incentive compensation for the period through the termination
date of the agreement (as extended) based on the greater of actual
EBITDA and EBITDA in the last fiscal year of the Company preceding the
delivery of the notice of termination, and an amount equal to the
present value of the base compensation payable through the expiration
date of the agreement (as extended). In addition, Mr. Karmazin's
agreement terminates upon Mr. Karmazin's disability for six consecutive
months or his death. In the event of a termination due to disability,
Mr. Karmazin is entitled to receive 75% of his base compensation through
the termination date of the agreement (as extended), subject to offset
by the value of certain Company-provided disability benefits; in the
event of a termination due to death, his estate or beneficiary is
entitled to receive the present value of his base compensation for the
period ending on the earlier of the first anniversary of his death or
the expiration date of the agreement (as extended). In the event Mr.
Karmazin's employment is terminated for cause (as defined in the
agreement) or Mr. Karmazin terminates his employment for other than good
reason (as defined in the agreement), Mr. Karmazin is entitled to
receive base compensation through the date of the notice of termination
(if for cause) or actual termination (if voluntary) and any previously
unpaid incentive compensation attributable to prior years. The
agreement also permits Mr. Karmazin to terminate his employment
11
<PAGE>
following a change in control (as defined in the agreement). In the
event of such a termination, Mr. Karmazin is entitled to receive base
compensation and prorated incentive compensation through the effective
date of termination, and any previously unpaid incentive compensation
attributable to prior years.
Under their respective employment agreements, Messrs. Wiener,
Carrus and Karmazin may participate in all employee benefit plans of the
Company for which they are otherwise eligible.
For information regarding the payments that were made to
Messrs. Wiener, Carrus and Karmazin pursuant to the terms of their
respective employment agreements during the past three fiscal years, see
the "Summary Compensation Table," above and "Compensation of Executive
Officers -- Report of the Board of Directors Concerning Executive
Compensation," below.
Additional Matters
Section 16(a) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), requires the Company's directors,
executive officers and holders of more than 10% of the Class A Shares to
file with the Securities and Exchange Commission (the "Commission")
initial reports of ownership and reports of changes in ownership of
Common Stock and other equity securities of the Company. The Company
believes that during the year ended December 31, 1993, its executive
officers, directors and holders of more than 10% of the Class A Shares
complied with all Section 16(a) filing requirements, with the following
exception. On November 29, 1993, Mr. Simpson filed a report on Form 4
relating to the month of April 1993. In making these statements, the
Company has relied on copies of filings submitted to the Company and on
written representations of its directors and executive officers.
The Company has executed indemnity agreements with all of its
executive officers and directors, except Messrs. Singleton and Stern.
These agreements require the Company to indemnify the seven covered
individuals for liabilities incurred by them because of any act or
omission or neglect or breach of duty committed while acting in the
capacity of an officer or director of the Company, to the fullest extent
permitted by the laws of the State of Delaware. Certain actions,
including acts for which indemnification is found by a court to be
illegal and contrary to public policy, are excluded from the coverage of
the agreements. Mr. Karmazin's employment agreement also requires the
Company to indemnify Mr. Karmazin to the fullest extent permitted by
applicable Delaware law.
Compensation Committee Interlocks and Insider Participation
In 1993, the Compensation Committee, consisting of Messrs.
Wiener and Carrus, was responsible only for administering the Option
Plan and for making and administering grants to executive officers of
the Company under the Deferred Share Plan. Neither Mr. Wiener nor Mr.
Carrus has ever received an award under either plan. In 1993, Mr.
Karmazin, the Company's President and Chief Executive Officer (the
"CEO"), was responsible for determining the amounts of salary and bonus
payable to the Company's Vice President-Finance and Chief Financial
Officer (the "CFO").
All other matters relating to executive compensation are
determined by the Company's Board of Directors. Messrs. Wiener, Carrus,
Karmazin and Suleman are executive officers and directors of the Company
and, as such, participate in all deliberations of the Company's Board of
Directors, including those regarding executive compensation decisions.
It is the policy of
12
<PAGE>
the Board of Directors to require any person who is a director of the
Company to recuse himself from any vote by the Board of Directors to
determine the amount of such person's salary or other compensation,
except that the annual EBITDA targets that control whether Mr. Karmazin
will be entitled to receive incentive compensation under his employment
agreement were determined for each year through 1993 by agreement of Mr.
Karmazin and the Board of Directors. See "Compensation of Executive
Officers -- Employment Agreements," above and "Compensation of Executive
Officers -- Report of the Board of Directors Concerning Executive
Compensation," below.
Report of the Board of Directors Concerning Executive Compensation
The Company is the largest radio broadcasting company in the
United States. The Company's strategy is to operate radio stations in
the nation's largest radio revenue markets and to improve its stations'
operating cash flow, and it seeks to sustain progressive growth in
long-term value for its stockholders. Given the growth and diversity of
the Company's operations, strong visionary leadership at the executive
officer level is essential. The compensation policies utilized by the
Board, its Compensation Committee (which in 1993 made and administered
grants of equity-based incentive compensation to executive officers and,
beginning in 1994 will make and administer all grants of incentive
compensation to executive officers if the proposals presented for
stockholder approval are adopted), and the CEO (who determines the
amount of salary payable to the CFO and also determined the amount of
bonus payable to the CFO in 1993) are intended to enable the Company to
attract, retain and motivate this caliber of management to meet Company
goals, using appropriate combinations of base salary and cash and
equity-based incentive compensation.
In 1985, the Company entered into long-term employment
agreements with Messrs. Karmazin, Wiener and Carrus. The Company
entered into a new employment agreement with Mr. Karmazin in 1990. Each
agreement provides for a minimum level of base salary; the Company's
agreement with Mr. Karmazin also provides for certain annual incentive
compensation opportunities (see "Compensation of Executive Officers --
Employment Agreements," above).
The decisions of the Board and the CEO with respect to the
compensation earned by executive officers in 1993 were based on
applicable contractual commitments, corporate performance in relation to
annually-determined earnings targets (in the case of compensation
payable to the CEO), the Company's operating and financial performance
in relation to that of other broadcasting companies, the overall growth
of the Company (including increases in individual executive officers'
responsibilities in connection therewith) and annual growth in the value
of the Common Stock, as well as individual performance (the foregoing
factors are listed in the order of their relative importance in the
decisions of the Board and the CEO).
The Board's Compensation Committee, consisting of Messrs.
Wiener and Carrus, utilized the foregoing factors in the same manner in
determining whether to grant equity-based incentive compensation to
executive officers under the Option Plan and the Deferred Share Plan.
Because, as noted above, it is the policy of the Board of Directors to
require any person who is a director of the Company to recuse himself
from any decision regarding the amount of such person's salary or other
compensation, Messrs. Wiener and Carrus do not receive awards under the
Option Plan or the Deferred Share Plan, and none of the executive
officers participates in Board decisions regarding the amount of his own
compensation (except that earnings targets on which incentive
compensation awards for Mr. Karmazin for the Company's 1992 and 1993
fiscal years were based were set by agreement between Mr. Karmazin and
the Board, as explained below).
In March 1993, the Board increased Mr. Karmazin's base salary
from $750,000 (the minimum base salary level set in his September 10,
1990 employment agreement with the
13
<PAGE>
Company) to $925,000. This increase was made in recognition of the
significant changes in Mr. Karmazin's responsibilities in the years
since 1990, including increases in responsibility arising from the
Company's growth through acquisitions during that period, its 1992
initial public offering (the "IPO"), and its management contract with
Unistar Communications Group, Inc. ("UCG"), under which Mr. Karmazin has
served as UCG's Chief Executive Officer. The Board determined that the
increase in salary was appropriate in light of such added
responsibilities, and recognized the Company's outstanding operating and
financial performance under Mr. Karmazin's leadership. In October 1993,
in recognition of the Company's performance since the IPO, including an
over 200% increase in the Company's stock price, the expansion of the
Company's presence in the radio program distribution business through
its management agreement with UCG, and its then pending management
agreement with Westwood One, Inc. ("Westwood One"), pursuant to which
Mr. Karmazin would also serve as the Chief Executive Officer of Westwood
One, the Compensation Committee recommended, and the Board approved, the
payment of a special $1 million cash bonus to Mr. Karmazin. Mr.
Karmazin had also received a $247,000 cash bonus earlier in 1993,
pursuant to his employment agreement, in recognition of the Company's
achievement of its 1992 EBITDA target.
On April 30, 1993, the Compensation Committee awarded Mr. Karmazin
an option under the Option Plan for the purchase of 112,500 Class B
Shares. This option, which has a per share exercise price, of $9.26
(85% of the closing price of the Class A Shares on December 31, 1992),
was immediately exercisable and will expire ten years from the date of
grant. The option award was made pursuant to Mr. Karmazin's employment
contract, in recognition of the Company's achievement of its 1992 EBITDA
target.
In March 1994, after reviewing the potential effect of Section
162(m) of The Internal Revenue Code of 1986, as amended ("Section
162(m)") which generally sets a limit of $1 million on the amount of
compensation (other than certain types of compensation, including
"performance-related" compensation) that the Company can deduct for
federal income tax purposes with respect to the compensation of each of
the CEO and the named executive officers for taxable years beginning on
or after January 1, 1994, the Compensation Committee and the Board
determined that their general policy will be to structure the
compensation arrangements for the CEO and other senior executive
officers, to the extent feasible and taking into account all relevant
considerations, so as to satisfy Section 162(m)'s conditions for
deductibility. In accordance with this policy, the Compensation
Committee decided, and Mr. Karmazin agreed, that all equity-based
incentive compensation payable to Mr. Karmazin on account of the
Company's achievement of its 1993 EBITDA goals should be paid in the
form of options granted at an exercise price equal to the full fair
market value of the underlying shares of common stock on the date of
grant, rather than in the form of deferred shares and options with an
exercise price discounted from the 1993 year-end closing price, as
called for by Mr. Karmazin's employment agreement. The Compensation
Committee expects that a significant portion of the compensation
provided to the CEO and the CFO will continue to be performance-based.
Certain of the proposals submitted for stockholder approval are
intended to facilitate the Company's ability to gratify such compensa-
tion for the performance-based compensation exemption from the general
limitation imposed by Section 162(m) on the Company's ability to
deduct compensation paid to executive officers. (See "Proposal to
Approve Amendments to Option Plan," "Proposal to Approve Cash Bonus
Compensation Plan," and "Proposal to Approve Certain Provisions of Mr.
Karmazin's Amended Employment Agreement", below.)
Michael Wiener Steven A. Lerman James A. Stern
Gerald Carrus Alan R. Batkin James L. Singleton
Mel Karmazin Orenthal J. Simpson Farid Suleman
14
<PAGE>
Performance Graph
The chart below compares the performance of the Class A Shares
with the performance of the NASDAQ Composite Index and a peer group of
companies, measuring the changes in common stock prices from January 31,
1992 to December 31, 1993. As required by the Commission, the values
shown assume the reinvestment of all dividends and, in the case of the
peer group, are weighted to reflect the market capitalization of the
component companies. The peer group is comprised of Capital Cities/ABC
Inc., CBS, Inc., Viacom, Inc., Gannett Co., Inc., Tribune Co. and Clear
Channel Communications, Inc., all of which, like the Company, are major
advertiser-supported media and entertainment companies. The Company
utilizes companies in this peer group for reference purposes in
connection with executive officer compensation determinations.
<TABLE>
<CAPTION>
Infinity
Measurement Broadcasting NASDAQ Peer
Period Corporation Composite Group
___________ ____________ _________ _____
<S> <C> <C> <C>
01/31/92 100.00% 100.00% 100.00%
12/31/92 140.00% 109.80% 122.23%
12/31/93 288.80% 125.30% 151.30%
</TABLE>
15
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information concerning the
beneficial ownership of the Company's common stock as of April 1,
1994, by (1) each person known to the Company to own beneficially
more than 5% of any class of Common Stock, (2) each director and
nominee to serve as a director of the Company, (3) each executive
officer of the Company named in the Summary Compensation Table and
(4) all directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
Class A Shares Class B Shares Class C Shares
_______________ ______________ ______________
Percent
Percent Percent Percent of Total
of of of Voting
Name Shares(1) Class(1) Shares(1) Class(1) Shares(1) Class(1) Power(1)
________________________________ _________ ________ _________ ________ _________ ________ ________
<S> <C> <C> <C> <C> <C> <C> <C>
Gerald Carrus(2).............. 61,674 * 1,868,138 46.8% ----- ----- 27.2%
Michael A. Wiener(2).......... 234,374 (3) * (3) 1,703,138(4) 42.7%(4) ----- ----- 25.1%(3)(4)
Mel Karmazin(2)............... 245,834 (5) * (5) 2,546,152(6) 41.6%(6) ----- ----- 28.5%(5)(6)
Lehman Investors(7)........... ----- ----- ----- ----- 9,431,640(8) 100.00%(8) 12.1% (8)
Metropolitan Life Insurance
Company(9)................ 1,860,050 6.5% ----- ----- ----- ----- 2.7%
State Street Research &
Management Company(10).... 1,831,100 6.4% ----- ----- ----- ----- 2.7%
Dietche & Field Advisers,
Inc(11)................... 1,525,000 5.4% ----- ----- ----- ----- 2.2%
FMR Corp.(12)................... 1,480,050 5.2% ----- ----- ----- ----- 2.1%
Edward C. Johnson 3d(12)........ 1,480,050 5.2% ----- ----- ----- ----- 2.1%
The Putnam Advisory
Company, Inc(13).......... 420,121 1.5% ----- ----- ----- ----- *
Putnam Investment
Management, Inc.(13)...... 1,937,525 6.8% ----- ----- ----- ----- 2.8%
James A. Stern(7)............... ----- ----- ----- ----- ----- ----- -----
James L. Singleton(7).......... ----- ----- ----- ----- ----- ----- -----
Farid Suleman(2)............... 118,391 (14) * (14) ----- ----- ----- ----- *
Steven A. Lerman(15)........... ----- ----- ----- ----- ----- ----- -----
Alan R. Batkin(16)............. 6,750 (17) * (17) ----- ----- ----- ----- *
Orenthal J. Simpson(18)......... 12,375 (19) * (19) ----- ----- ----- ----- *
All directors and executive
officers as a group
(9 persons)................ 679,398 2.4% 6,117,428 100.0% ----- ----- 68.5%
<FN>
* Less than 1%
16
<PAGE>
(1) The information as to beneficial ownership is based on statements
furnished to the Company by the beneficial owners. As used in this
Table, "beneficial ownership" means the sole or shared power to vote,
or to direct the voting of, a security, or the sole or shared
investment power with respect to a security (i.e., the power to dispose
of, or to direct the disposition of, a security). For purposes of this
Table, a person is deemed as of any date to have "beneficial ownership"
of any security that such person has the right to acquire within 60
days after such date, except that "beneficial ownership" does not
include the number of Class A Shares issuable upon conversion of Class
B Shares and Class C Shares, even though Class B Shares and Class C
Shares are freely convertible into Class A Shares.
(2) The address of each person is Infinity Broadcasting Corporation,
600 Madison Avenue, New York, New York 10022.
(3) Includes 234,374 of Class A Shares owned by trusts for the benefit
of Mr. Wiener's children, as to which Mr. Wiener disclaims beneficial
ownership.
(4) Includes 80,000 Class B Shares owned by The Michael Wiener 1993
Trust and 80,000 Class B Shares owned by The Zena Wiener 1994 Trust.
Also includes 30,000 Class B Shares owned by The Zena and Michael A.
Wiener Foundation, as to which Mr. Wiener disclaims beneficial
ownership.
(5) Includes warrants exercisable for 32,439 of Class A Shares, at a
price of $.00267 per share. Also includes options exercisable for
56,142 Class A Shares, at a price of $25.50 per share, granted on March
30, 1994 under the Option Plan in accordance with Mr. Karmazin's
employment agreement with the Company.
(6) Includes options exercisable for 1,939,307 of Class B Shares, at a
price of $.0267 per share, granted to Mr. Karmazin pursuant to an option
agreement dated as of June 27, 1988, and amended as of August 2, 1988
and October 14, 1988. Also includes an option exercisable for 112,500
Class B Shares, at a price of $9.26 per share, granted to Mr.
Karmazin on April 30, 1993 under the Option Plan, in accordance with
Mr. Karmazin's employment agreement with the Company and options
exercisable for 75,000 Class B Shares, at a price of $25.50 per share,
granted to Mr. Karmazin on March 30, 1994 under the Option Plan in
satisfaction of the Company's equity incentive compensation
obligations with respect to the Company's 1993 fiscal year under Mr.
Karmazin's employment agreement with the Company. Without giving effect
to the exercise of the options described above, Mr. Karmazin owns
approximately 10.5% of the outstanding Class B Shares.
(7) The general partners of the limited partnerships included in the
Lehman Investors are subsidiaries of Lehman Brothers Holdings Inc., a
company whose common stock is principally owned by American Express
Company. The address for American Express Company, each of the Lehman
Investors, and Messrs. Stern and Singleton is Three World Financial
Center, New York, New York 10285.
(8) Includes Lehman Warrants exercisable for 8,935,526 Class C Shares.
(9) Of the 1,860,050 Class A Shares beneficially owned by Metropolitan Life
Insurance Company, 1,801,350 shares are owned with sole voting power as
of February 9, 1994.
(10) Of the 1,831,100 Class A Shares beneficially owned by State Street
Research & Management Company, 1,772,400 shares are owned with sole
voting power as of February 10, 1994.
(11) Of the 1,525,000 Class A Shares beneficially owned by Dietche &
Field Advisers, Inc., all are owned with sole voting power as of March
11, 1994.
17
<PAGE>
(12) Includes Class A Shares beneficially owned by FMR Corp. ("FMR") and
Edward C. Johnson 3d ("Johnson") as of February 14, 1993. Fidelity
Management & Research Company ("Fidelity") and Fidelity Management Trust
Company ("Fidelity Management"), both wholly-owned subsidiaries of FMR,
are the beneficial owners of 265,950 Class A Shares and 1,214,100
Class A Shares, respectively. Johnson (the Chairman of FMR) and FMR,
through its control of Fidelity, have sole dispositive power with
respect to the Class A Shares beneficially owned by Fidelity. FMR,
through its control of Fidelity Management, has sole voting power with
respect to the Class A Shares beneficially owned by Fidelity
Management, and FMR and Johnson have sole dispositive power with
respect to such shares. The address of Fidelity, Fidelity Management,
FMR, and Johnson is 82 Devonshire Street, Boston, Massachusetts 02109.
(13) Includes Class A Shares beneficially owned by The Putnam Advisory
Company, Inc. ("PAC") and Putnam Investment Management, Inc. ("PIM") as
of January 18, 1994. PAC and PIM are both wholly-owned subsidiaries of
Putnam Investments, Inc. ("PI"), a wholly-owned subsidiary of Marsh &
McLennan Companies, Inc. ("M&MC"). Of the 420,121 Class A Shares
beneficially owned by PAC, 324,463 shares are owned with shared
voting power and all are owned with shared dispositive power. Of the
1,937,525 Class A Shares beneficially owned by PIM, all are owned with
shared dispositive power. PI and M&MC disclaim beneficial ownership of
the 2,357,646 Class A Shares beneficially owned by PAC and PIM. The
address of PAC, PIM, PI and M&MC is One Post Office Square, Boston,
Massachusetts 02109.
(14) Includes options exercisable for 75,000 and 11,250 Class A Shares,
at a price of $.13 and $8.78 per share, respectively. Does not include
112,500 Class A Shares as to which options (exercisable at a price of
$7.78 per share with respect to 67,500 of such shares and $8.78 per
share with respect to the remainder of such shares) were granted in June
1993 pursuant to the Option Plan, or 37,500 Class A Shares as to which
an option (exercisable at a price of $26.00 per share) was granted in
September 1993 pursuant to the Option Plan, because Mr. Suleman does not
have the right to receive such shares within 60 days after April 1, 1994.
(15) Mr. Lerman's address is Leventhal, Senter & Lerman, 2000 K Street,
N.W., Washington, D.C. 20006.
(16) Mr. Batkin's address is Kissinger Associates, Inc., 350 Park
Avenue, New York, New York 10022.
(17) Includes 1,125 Class A Shares held by Mr. Batkin's wife. Also
includes options exercisable for 4,500 Class A Shares, at a price of
$8.78 per share. Does not include 18,000 Class A Shares as to which an
option, exercisable at a price of $8.78 per share, was granted in July
1993 pursuant to the Option Plan, because Mr. Batkin does not have the
right to receive such shares within 60 days after April 1, 1994.
(18) Mr. Simpson's address is O.J. Simpson Enterprises, 11661 San
Vicente Blvd., Suite 632, Los Angeles, California 90049.
(19) Includes options exercisable for 4,500 Class A Shares, at a price
of $8.78 per share. Does not include 18,000 Class A Shares as to which
an option, exercisable at a price of $8.78 per share, was granted in
July 1993 pursuant to the Option Plan, because Mr. Simpson does not have
the right to receive such shares within 60 days after April 1, 1994.
</TABLE>
CERTAIN RELATIONSHIPS AND TRANSACTIONS
Since February 1980, the Company has leased approximately 7,500
square feet of office space in Boston, Massachusetts from 1265 Realty Company.
Gerald Carrus and Michael A. Wiener each owns 35% of 1265 Realty Company. The
Company's Boston radio station, WBCN-FM, uses this space for
18
<PAGE>
its studios and offices. The lease, as amended in 1983, expires on
December 31, 1998 and provides for an annual rent of $145,380, subject
to certain annual adjustments to account for inflation. The Company
believes that the terms of this lease are comparable to those that would
be contained in a lease entered into with an unrelated third party.
In 1981, the Company made unsecured, non-interest-bearing
loans due in June 1994 of $600,000 to each of Michael A. Wiener and
Gerald Carrus for their personal use. Each of them executed a
promissory note for the full amount of his loan.
Lehman Brothers acted as one of the representatives of the
underwriters for the IPO, the public offering by the Company in March
1992 of $200 million principal amount of its 10-3/8% Senior Subordinated
Notes Due 2002 and the public offering in May 1993 of 8,148,814
Class A Shares by the Company and certain holders, including Lehman
Brothers, of warrants exercisable for Class A Shares (the "1993 Equity
Offering"). Lehman Brothers also acted as one of the representatives
of the underwriters for the secondary offering in December 1993 of
5,550,000 Class A Shares by certain stockholders. The Lehman Investors
sold 4,800,000 of such Class A Shares. The Company believes that each
of these transactions with Lehman Brothers was for fair value and on
terms and conditions no less favorable to the Company than would have
been available to it in a comparable transaction with an unrelated
person.
Mr. Lerman is a partner in the law firm of Leventhal, Senter
& Lerman, which represents the Company in certain matters. During
1993, the Company paid Leventhal, Senter & Lerman approximately
$934,000 in respect of services rendered to the Company in 1993.
Transactions between the Company and its officers, directors
and affiliates, and loans made by the Company to such persons, are
approved by a majority of the directors who are not party to such
transactions. The Company intends to continue this policy in the
future.
APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
KPMG Peat Marwick has been recommended by the Board of
Directors for reappointment as the independent public accountants for
the Company. KPMG Peat Marwick were the auditors for the Company for
the year ended December 31, 1993, and the firm is a member of the SEC
Practice Section of the American Institute of Certified Public
Accountants. Subject to stockholder ratification, the Board of
Directors has appointed this firm as the Company's independent public
accountants for 1994.
Representatives of the firm will attend the Annual Meeting
and will have an opportunity to make a statement if they so desire and
to respond to appropriate questions from stockholders.
The Company will present to the Annual Meeting the following
resolution:
RESOLVED: That the selection, by the Board of Directors, of
KPMG Peat Marwick as independent public accountants to audit
the books of account and other corporate records of the Company
for 1994 be, and hereby is, ratified.
Adoption of this proposal requires approval by a majority
of the votes that could be cast by the holders of the shares of all
classes of the Common Stock who are present in person or by proxy at
the Annual Meeting. Spaces are provided in the accompanying form
of proxy for specifying approval, disapproval or abstention as to
this proposal. Abstentions from voting on this proposal
(including broker non-votes) will have the effect of votes against
this proposal.
The Board of Directors recommends a vote "FOR" this proposal.
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PROPOSAL TO APPROVE AMENDMENTS TO THE OPTION PLAN
The Board of Directors has adopted, subject to stockholder
approval, an amendment to the Option Plan increasing by 2,000,000
the number of Class A Shares, and by 600,000 the number of Class B
Shares, as to which options may be granted under the Option Plan.
The Board of Directors recommends approval of amendments to the
Option Plan (i) to increase by 2,000,000 the number of Class A Shares
(subject to adjustments for stock dividends and splits and other
capital adjustments) and to increase by 600,000 the number of Class B
Shares (also subject to adjustment) that may be issued under the
Option Plan, (ii) to set the maximum number of such shares as to which
options may be awarded to any plan participant in any calendar year, and
(iii) to provide for option awards to the CEO and other senior
executive officers whom the Board may designate in the future as
eligible for such award(s) upon the Company's achievement of EBITDA
targets established in advance by the Compensation Committee.
Increase in Authorized Shares
_____________________________
The increase of the number of Class A Shares and Class B
Shares that are available for options will enable the Compensation
Committee to continue to grant performance-based incentive compensation
in the form of stock options. Such options are an important component
of the Company's compensation incentives that are designed to attract,
retain and motivate the best qualified executives, other key
employees and non-employee directors and to create and reinforce
long-term mutuality of interest between the Company's key
employees and directors, on the one hand, and the Company's
stockholders, on the other, by encouraging ownership of Company
stock and providing opportunities for participation in the Company's
long-term performance. Options have been granted with respect to
substantially all of the 2,664,350 Class A Shares and all of the
187,500 Class B Shares previously authorized for issuance under the
Option Plan, which was established in 1988. A substantial portion of
the options with respect to Class A Shares were granted prior to the
Company's 1992 IPO; options with respect to all of the previously
authorized Class B Shares have been granted upon the attainment of
Company EBITDA targets, in connection with contractual incentive
compensation arrangements.
The exercise prices of all options granted under the Option
Plan with respect to Class A Shares since the IPO have been equal to
the fair market value of such Class A Shares on the date of grant (or,
in certain cases, the date on which the option grant was recommended,
if the grant was made subsequent to the recommendation date).
Options granted under the Option Plan with respect to Class B Shares
have exercise prices equal to the fair market value of Class A
Shares as of the date of grant or, in the case of options granted in
recognition of the Company's achievement of its 1992 EBITDA target, 85%
of the fair market value of Class A Shares on December 31, 1992.
Amendments Relating to Section 162(m)
_____________________________________
The Board has adopted, subject to stockholder approval,
additional amendments to the Option Plan which are designed to preserve
the Company's ability to deduct, for Federal income tax purposes,
compensation paid pursuant to the exercise of stock options. These
amendments establish a limit on the number of shares as to which
options may be granted to any individual in any year, and provide for
certain option awards upon the attainment of pre-established EBITDA
goals.
Annual Award Limit
Section 162(m) requires, as a condition to the
deductibility of compensation realized upon the exercise of options
with an exercise price equal to the fair market value of the
underlying shares on the date of grant, that a plan specify the
maximum number of shares as to which options may be awarded to any
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particular individual in any year beginning on or after January 1,
1994. To satisfy this requirement, the amendment to the Option Plan
generally imposes a limit of 200,000 on the number of Shares of Common
Stock as to which options may be granted to any individual in any
fiscal year of the Company (currently, the calendar year). The
Compensation Committee has discretion to award options with respect
to less than the maximum number of shares in any given year and, to
the extent it does so, the amended Option Plan permits the carryover
of the unused portion of the maximum to subsequent years, up to
300,000 shares. The carryover provision gives the Compensation
Committee flexibility to reward outstanding performance and to provide
additional incentives, to the extent the Compensation Committee deems
such measures appropriate. Options cannot be awarded to any
individual with respect to more than 500,000 shares in any year, and
the carryover amount does not increase in years for which the
individual did not receive any option awards. For example, if the
Compensation Committee awards a key employee options for the purchase
of 50,000 shares of Common Stock in 1994, the maximum number of shares
as to which a 1995 award could be made to such key employee will be
350,000. If the key employee does not receive any option awards in
1995, the key employee's 1996 maximum will remain 350,000 shares.
If the Compensation Committee awards the key employee an option with
respect to 25,000 shares in 1996, the key employee's maximum
permissible number of shares for 1997 will be 500,000. (Because no
more than 300,000 shares can be carried forward, no participant can be
awarded options with respect to more than 500,000 shares in any one
year.)
EBITDA Target Awards
Section 162(m) permits the deduction of compensation realized
upon the exercise of options granted upon the achievement of
pre-established Company performance goals. To preserve the
deductibility of compensation attributable to the types of
performance-based stock option awards that have been provided for under
Mr. Karmazin's employment agreement since 1990, and to qualify such
awards to other senior executive officers for Section 162(m) purposes in
the event the Compensation Committee and the Board deem it appropriate
to make such compensation opportunities available to other senior
executive officers in the future, the Option Plan amendments recently
adopted by the Board include the following provisions.
The amendments permit the Compensation Committee to award
options for the purchase of up to 112,500 shares of common stock to the
CEO (and to any other senior executive officer designated by the Board
in advance of the applicable period) upon the Company's attainment
of a target with respect to the Company's earnings before interest,
taxes, depreciation and amortization ("EBITDA") established in
advance for a particular period by the Compensation Committee (such
awards are referred to in this description as "EBITDA Target
Awards"). The exercise price of each option granted in an EBITDA
Target Award will be 85% of the fair market value of the underlying
share of Common Stock as of the last day of the period for which the
award is made (for purposes of the Option Plan, the fair market value of
a share of Common Stock is deemed to be the closing price of a Class A
Share as reported on the NASDAQ Market System for the applicable
date). If an award is made with respect to less than an entire calendar
year, both the EBITDA target and the maximum award will be prorated. Any
option granted under an EBITDA Target Award will be immediately exercisable
and will expire ten years after the date of grant. Such options will
be counted against the annual maximum share award limits described
above and, to the extent an EBITDA Target Award is called for under
an executive's employment agreement, the award will be deemed to have
been made pursuant to the employment agreement (see "Proposal to
Approve Certain Provisions of Mr. Karmazin's Amended Employment
Agreement," below).
The Option Plan amendments submitted for stockholder approval
are set forth in Exhibit A to this Proxy Statement. The other
provisions of the Option Plan, and the federal income tax consequences
of the grant and exercise of options thereunder, are described below.
See also "New Plan Benefits," below. If the proposal to approve the
amendment is not adopted, the Compensation Committee will continue to
have authority to make discretionary awards under the Option Plan, up to
the number of shares as to which Option Plan awards are currently authorized.
The affirmative vote of a majority of the holders of all shares
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of all classes of the Company's Common Stock present in person or
represented by proxy and entitled to vote at the Annual Meeting is
required to adopt the foregoing proposal. Spaces are provided on the
accompanying form of proxy for specifying approval, disapproval or
abstention as to this proposal. Abstentions from voting on this proposal
will have the effect of votes against this proposal. Broker non-votes
will have no effect on the outcome.
The Board of Directors recommends a vote "FOR" this proposal.
The Option Plan
As originally approved by the Company's stockholders in
October 1988, the Option Plan provided for the grant of options to
purchase up to 1,500,000 Class A Shares. The Option Plan was
amended with the approval of the Company's stockholders in September
1990 and August 1992 and currently provides for the grant of options to
purchase up to 2,664,350 Class A Shares and up to 187,500 Class B
Shares. Upon approval of the proposal described above, the Option
Plan will provide for the grant of options to purchase up to
4,664,350 Class A Shares and 787,500 Class B Shares (including all
shares previously authorized).
Under the Option Plan, the maximum term of each option is
ten years from the date of grant. Option Plan grants are required
to be made and administered by a committee of two or more
directors who are disinterested persons (within the meaning of Rule
16b-3 under the Exchange Act ("Rule 16b-3")). The Compensation
Committee, consisting of Messrs. Carrus and Wiener, currently
serves this function.
The Compensation Committee selects the recipients and
determines the number and the terms of options granted under the
Option Plan, including the option price. The Compensation Committee
may award options to key employees of the Company (including such
employees who are members of the Board of Directors) and non-employee
members of the Board of Directors. In selecting recipients and in
determining the number of options to be granted, the Compensation
Committee may consider the following factors regarding a prospective
recipient: the office or position held, the degree of
responsibility for and contribution to the Company's growth and
success, the recipient's potential, other performance factors deemed
relevant by the Compensation Committee and, in the case of
recipients other than the CEO, the recommendations of the CEO.
Options become exercisable at such time or times as the
Compensation Committee may determine when it grants options. Options
granted under the Option Plan are not transferable by the holder other
than by will or the laws of descent and distribution. If an
applicable option agreement so provides, the Compensation Committee,
in its sole discretion, may elect to pay the holder of an option
an amount in cash or shares or a combination of cash and shares
equal to the amount by which the fair market value of the shares on the
date of exercise of the option exceeds the purchase price that
would otherwise be payable by the holder of such option.
Upon approval of the proposal described above, the Option Plan
will limit the number of shares of Common Stock as to which the
Compensation Committee may award options to any individual in any year
to 200,000 (any unused portion of this limit for a year in which an
award is granted to an individual may be carried forward to
subsequent years for such individual, but no individual may be
awarded options for more than 500,000 shares in any single year).
The Option Plan will also permit the Compensation Committee to make
special EBITDA Target Awards of options for up to 112,500 shares of
Common Stock per year to each of the CEO and any other senior
executive officers designated in advance by the Board, if the
Company attains the EBITDA Targets established in advance by the Compensation
Committee. EBITDA Target Awards are counted against the annual award
limits described above, and are granted at an exercise price equal to
85% of the fair market value of the underlying shares as of the last day
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of the period for which the award is made. (See "Proposal to Approve
Amendments to the Option Plan--Amendments Relating to Section 162(m),"
above).
Federal Income Tax Consequences -- Option Plan
Set forth below is a summary of the federal income tax
consequences under the Internal Revenue Code of 1986, as amended (the
"Code"), of the grant and exercise of options awarded under the Option
Plan (which is not qualified under Section 401(a) of the Code). The
following summary does not include any discussion of state, local or
foreign income tax consequences or the effect of gift, estate or
inheritance taxes, any of which may be significant to a particular
employee or director eligible to receive an award. In addition,
this summary is based in part upon proposed regulations
concerning incentive stock options. The interpretations provided by
such proposed regulations are subject to change. Moreover, this summary
does not apply to every specific transaction that may occur. Each
employee or director who receives an award should consult his or her tax
advisor for advice concerning his or her particular circumstances.
Non-Qualified Stock Options. There will be no federal
income tax consequences to either the employee or the Company on the
grant of a non-qualified option. On the exercise of a non-qualified
option (except as described below), the employee has taxable ordinary
income equal to the excess of the fair market value on the exercise
date of the shares of Common Stock received over the option price of the
shares. The Company will be entitled to a federal income tax
deduction in an amount equal to such excess, provided the Company
complies with applicable tax withholding rules. In the case of an
employee subject to Section 16 of the Exchange Act (an
"Insider"), the employee's recognition of income (and the
Company's deduction) may be deferred beyond the date of exercise.
Under Section 16, the grant of an option, not its exercise, is treated
as an acquisition of a security to which the statute applies. If
such grant is made pursuant to a plan meeting the requirements of a
special exemption applicable to certain employee benefit plans and at
least six months elapse between the grant and the sale of the shares
received upon exercise, such grant will be treated as an exempt
acquisition under Section 16(b). With respect to the recognition
of income in connection with the exercise of a non-qualified option,
unless an Insider has had a non-exempt acquisition within the
six-month period prior to the exercise date, the Insider will
recognize ordinary income on the later of (i) six months after the date
of grant and (ii) the date of exercise (such later date being referred
to as the "Delayed Date"). The timing of income recognition with
respect to an Insider who exercises a non-qualified option within six
months of a prior non-exempt acquisition of stock is uncertain. It is
possible that the Internal Revenue Service will take the position
that, despite the prior non-exempt acquisition, the Insider recognizes
income on the Delayed Date rather than the date which is six
months following the date of such prior non-exempt acquisition (such
date being referred to as the "Deferred Date"). An Insider can be
certain of recognizing income on the exercise date by making an income
recognition election under Section 83(b) of the Code (an "83(b)
Election") within 30 days of the date of exercise.
Any ordinary income realized by an employee upon exercise of
a non-qualified option will increase his tax basis in the Common
Stock thereby acquired. Upon the sale of Common Stock acquired by
exercise of a non-qualified option, an employee will realize
long-term or short-term capital gain or loss depending upon his
holding period for such stock. The holding period for capital gains
purposes begins on the date of the exercise pursuant to which such
shares were acquired, or whichever of the Delayed Date or the
Deferred Date applies in the case of an insider who has not made an
83(b) Election.
If the Company delivers cash or shares of Common Stock to an
employee in lieu of accepting payment upon the exercise of a non-qualified
option, the employee will recognize ordinary income in an amount equal
to the cash paid and the fair market value as of the date of exercise
(or whichever of the Delayed or Deferred Date applies in the case of an
Insider who has not made an 83(b) Election) of any
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shares delivered to him. An amount equal to the ordinary
income recognized by the employee will be deductible by the
Company, provided the Company complies with applicable tax
withholding requirements. As used in the foregoing discussion, the
term "employee" includes non-employee directors.
Incentive Stock Options. Under the Code, an employee
will not realize taxable income by reason of the grant or the
exercise of an incentive stock option. If an employee exercises an
incentive stock option and does not dispose of the shares transferred
until the later of two years from the date the option was granted and
one year from the date the shares were transferred to the employee,
the entire gain, if any, realized upon disposition of such shares
will be taxable to the employee as long-term capital gain, and the
Company will not be entitled to any deduction. Any loss will be a
long-term capital loss. If an employee disposes of the shares within
such one-year or two-year period in a manner so as to violate the
holding period requirements (a "disqualifying disposition"), the
employee generally will realize ordinary income in the year of
disposition, and the Company will receive a corresponding deduction,
in an amount equal to the excess of (1) the lesser of (a) the
amount, if any, realized on the disposi tion and (b) the fair market
value of the shares on the date the option was exercised (or whichever
of the Delayed or Deferred Date applies to an employee who is an
Insider and who has not made an 83(b) Election) over (2) the
option price. Any additional gain realized on the sale or exchange will
be long-term or short-term capital gain and any loss will be
long-term or short-term capital loss. The employee will be considered
to have disposed of a share if he sells, exchanges, makes a gift of or
transfers legal title to the share (except by pledge or by transfer on
death). If the disposition is by gift and violates the holding
period requirements, the amount of the employee's ordinary income (and
the Company's deduction) is equal to the fair market value of the
shares on the date of exercise (or whichever of the Delayed or Deferred
Date applies to an employee who is an Insider and who has not made an
83(b) Election) less the option price. If the disposition is a sale or
exchange, the employee's tax basis will equal the amount paid for
the share plus any ordinary income realized as a result of the
disqualifying disposition. The exercise of any incentive stock option
may subject the employee to the alternative minimum tax.
If the Company delivers cash or shares of Common Stock to an
employee in lieu of accepting payment from him upon his exercise of an
incentive stock option, the employee will recognize ordinary income in
an amount equal to the cash paid and the fair market value as of
the date of exercise (or whichever of the Delayed or Deferred
Date applies in the case of an Insider who has not made an 83(b)
Election) of any shares delivered to him. An amount equal to any
such ordinary income will be deductible by the Company.
An incentive stock option that is exercised by a former
employee or his representative more than three months after the
termination of his employment (including retirement) will be
treated as a non-qualified option for federal income tax purposes.
(This three-month period is extended to one year if employment ceased
due to permanent and total disability.)
PROPOSAL TO APPROVE
CASH BONUS COMPENSATION PLAN
The Board of Directors recommends approval of a new
Infinity Broadcasting Corporation Cash Bonus Compensation Plan (the
"Bonus Plan"), which was adopted by the Board of Directors on March 30,
1994 and will become effective upon approval of this proposal.
The Board and the Compensation Committee believe that cash
incentives to senior executives, payable upon the Company's attainment
of specific performance goals, help to reinforce the mutuality of
interests between the Company's executive officers and its
shareholders and improve the value of the Company. Approval of
the Bonus Plan will enable the Company to continue to provide such
short-term cash bonus incentive compensation to its senior executive
officers and to qualify such compensation for the
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performance-based compensation exception to the limitation on the
Company's ability to deduct compensation in excess of $1 million paid
to certain executive officers in taxable years beginning on or
after January 1, 1994. If the Company's stockholders do not
approve the Bonus Plan, the Board will continue to have discretion
to award cash incentive compensation to executive officers, but
such awards will be subject to the Section 162(m) limitation on
deductibility.
The material features of the Bonus Plan are described
below (see also "New Plan Benefits," below).
The affirmative vote of a majority of the holders of all
shares of all classes of the Company's Common Stock present in person
or represented by proxy and entitled to vote at the Annual Meeting is
required to adopt the fore-going proposal. Spaces are provided on
the accompanying form of proxy for specifying approval,
disapproval or abstention as to this proposal. Abstentions from
voting on this proposal will have the effect of votes against this
proposal. Broker non-votes will have no effect on the outcome.
The Board of Directors recommends a vote "FOR" this proposal.
The Bonus Plan
The Bonus Plan authorizes the Compensation Committee to
establish annual targets with respect to the Company's earnings
before interest, taxes, depreciation and amortization ("EBITDA") for
fiscal years of the Company beginning on or after January 1, 1994,
and to award cash bonus compensation to the Company's Chief Executive
Officer, the Company's Chief Financial Officer, and any other senior
executive officers of the Company who are designated by the Board of
Directors in advance of the applicable period (each, an "Eligible
Participant"). The EBITDA target must be established in writing by
the Compensation Committee prior to the commencement of the
applicable fiscal year (or by such later date as may be permitted under
Section 162(m) for the establishment of goals pursuant to which
performance-based compensation is to be payable for a particular
period).
If the Company attains the EBITDA target set by the
Compensation Committee for a fiscal year, the Compensation Committee
may make cash bonus awards to Eligible Participants. The maximum cash
bonus award that may be made to any Eligible Participant under the Bonus
Plan for a fiscal year is generally $1,500,000, and the Compensation
Committee has full discretion to award less than the maximum amount to
any Eligible Participant (including the discretion to decline to make
any award to an Eligible Participant notwithstanding the Company's
attainment of its EBITDA target). In deciding whether to award less than
the maximum amount, the Compensation Committee may consider factors
such as the Eligible Participant's office or position, levels of
compensation paid by the Company's industry peers and competitors, the
Eligible Participant's degree of responsibility for and contributions
to the Company's growth and success, the Eligible Participant's
potential, the Eligible Participant's conduct, or any other
performance factors the Compensation Committee may consider relevant.
If the Compensation Committee awards an Eligible Participant
less than the maximum permitted bonus amount for a fiscal year, the
difference between such maximum bonus amount and the award actually
made can be carried forward to subsequent years to increase the maximum
bonus amount that can be awarded to such Eligible Participant if the
Company attains its EBITDA targets in later years. In no event,
however, can more than $1,500,000 be carried forward. For example,
if the Company attains its EBITDA target for 1994 and the Compensation
Committee awards an executive officer a bonus of $300,000 for 1994, the
maximum bonus that may be awarded to that executive officer if the
Company attains its 1995 EBITDA target will be $2,700,000. If the
Compensation Committee awards the executive officer a bonus of
$350,000 for 1995, the maximum bonus that may be awarded to that
executive officer if the Company
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attains its 1996 EBITDA target will be $3,000,000. (Because no more
than $1,500,000 can be carried forward, $3,000,000 is the highest bonus
that could be awarded to any individual for any year under the Bonus
Plan if the Compensation Committee determined that a bonus of such
magnitude were warranted.)
If an award is made for less than a full fiscal year, both
the applicable EBITDA target and the maximum award amount must be
prorated.
Awards payable under the Bonus Plan must be made no later
than the thirtieth day after the Company files its report on Form 10-K
for the fiscal year in question with the SEC or, if the award is made
for less than a full fiscal year, no later than the sixtieth day
following the end of the last month taken into account in determining
whether the EBITDA target has been met. If, notwithstanding the
Company's attainment of its applicable EBITDA target, the
Compensation Committee does not make an award to an Eligible Participant
within the foregoing time periods, the Compensation Committee will be
deemed to have declined to make an award to the Eligible Participant.
If an Eligible Participant's employment agreement with the
Company provides for cash bonus compensation, amounts paid to the
Eligible Participant pursuant to the Bonus Plan are deemed to have
been paid under that agreement, so that cash bonus awards will not be
duplicated.
PROPOSAL TO APPROVE CERTAIN PROVISIONS OF
MR. KARMAZIN'S AMENDED EMPLOYMENT AGREEMENT
The Board of Directors recommends approval of the material
terms of certain amendments to Mr. Karmazin's employment agreement
with the Company, as follows. The amendments, which were adopted by
the Board of Directors and executed by the Company and Mr. Karmazin
as of March 30, 1994, subject to stockholder approval of the material
terms thereof, are designed to preserve the Company's ability to
provide and to deduct for Federal income tax purposes the types of cash
and equity-based performance incentive compensation opportunities that
Mr. Karmazin has enjoyed since his employment agreement was entered
into in 1990. Mr. Karmazin, who prior to March 30, 1994 had the
right under his employment agreement to receive specified levels of cash
and equity-based incentive compensation upon the Company's attainment
of targeted levels of earnings before interest, taxes, depreciation and
amortization ("EBITDA") set by agreement of Mr. Karmazin and the
Board. Under the amended agreement, the EBITDA target levels will
instead be established by the Compensation Committee, and the
Company will not be obligated to pay Mr. Karmazin the incentive
compensation specified in the agreement unless the Company's stock-
holders approve the amended arrangements by adopting this proposal.
Mr. Karmazin voluntarily relinquished his pre-existing rights under
the agreement, agreeing with the Board that the interests of the
Company and its stockholders would best be served by preserving the
Company's ability to deduct the incentive compensation payable
pursuant to his employment agreement.
The amended cash and equity-based incentive provisions of Mr.
Karmazin's employment agreement are described below. Approval by
stockholders of the terms described below is one of several
requirements that must be met under Section 162(m) if incentive
compensation payable pursuant to the amended provisions is to qualify
for the performance-based compensation exception to the limitation
on the Company's ability to deduct compensation in excess of $1
million paid to Mr. Karmazin in taxable years beginning on or after
January 1, 1994. If the foregoing proposal is not approved, Mr.
Karmazin will have no right to receive the incentive compensation
provided for by the amended employment agreement and the incentive
compensation provisions of Mr. Karmazin's contract would be
renegotiated.
The incentive compensation provisions of Mr. Karmazin's
amended employment agreement are described below (see also "New Plan
Benefits," below). Other provisions of Mr. Karmazin's employment
agreement are described above (see "Executive Compensation -- Employment
Agreements").
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The affirmative vote of a majority of the holders of all
shares of all classes of the Company's Common Stock present in person
or represented by proxy and entitled to vote at the Annual Meeting
is required to adopt the foregoing proposal. Spaces are provided on
the accompanying form of proxy for specifying approval,
disapproval or abstention as to this proposal. Abstentions from
voting on this proposal will have the effect of votes against this
proposal. Broker non-votes will have no effect on the outcome.
The Board of Directors recommends a vote "FOR" this proposal.
Incentive Compensation Provisions of
Amended Employment Agreement
___________________________________
Mr. Karmazin's employment agreement, as amended, requires
the payment of cash and equity-based incentive compensation upon
the Company's attainment of annual EBITDA targets set in advance by the
Compensation Committee.
Cash Incentive Compensation
If the Company achieves its EBITDA target, as set by the
Compensation Committee, for 1994 or any subsequent fiscal year of the
Company, Mr. Karmazin will be entitled to receive cash incentive
compensation in the form of a $500,000 bonus, which will be
payable no later than the thirtieth day following the Company's filing
of its report on Form 10-K with the SEC for the applicable year. If
Mr. Karmazin's employment terminates prior to the end of a fiscal
year, a prorated portion of such incentive compensation will be payable
if the EBITDA target, as prorated to reflect the shorter period, was
met. The prorated award would be payable no later than the sixtieth
day following the end of the last month taken into account in
determining whether the prorated EBITDA target was met.
Any cash bonus paid to Mr. Karmazin pursuant to the Bonus
Plan for the applicable fiscal year will be deemed to have been paid
pursuant to his employment agreement, and such bonus will also be
taken into account in determining Mr. Karmazin's award limit under the
Bonus Plan.
The amended employment agreement, like Mr. Karmazin's
employment agreement as in effect prior to March 30, 1994, includes a
provision for special cash incentive compensation awards in the event
the Compensation Committee fails for any reason to award the
equity-based incentive compensation described below. In such event, if
the Company has attained the EBITDA target established by the
Compensation Committee for the applicable period, Mr. Karmazin will be
entitled to receive a cash award equal to the sum of (a) 25% of the
fair market value of the number of Class B Shares as to which Mr.
Karmazin was entitled to receive an award of options and (b) 125% of
the fair market value of the number of Class B Shares as to
which Mr. Karmazin was entitled to receive an award of deferred
shares. The fair market value of a share of Common Stock will, for
such purpose, be the closing price (as reported on the NASDAQ National
Market System) of a Class A Share on the date as of which the relevant
determination is made or, if no price is so reported, the value of a
Class A Share on such date as determined in good faith by the
Compensation Committee ("Fair Market Value").
Equity-Based Incentive Compensation
The amended employment agreement provides that, if the Company
attains the EBITDA target set by the Compensation Committee for a fiscal
year, Mr. Karmazin will be entitled to receive an option to acquire 112,500
Class B Shares (the option may be for Class A Shares to the extent options
for Class B Shares are not available for issuance under the Company's
stock option plan at the time of the award). The per-share exercise
price of such option will be 85% of the Fair Market Value of a Class B
27
<PAGE>
Share as of the last day of the period for which the award is made, and
the option will be immediately exercisable and will expire ten years
after the date of grant. The number of options, fair market value
percentage and exercisability provisions of the amended employment
agreement are identical to those of the agreement as in effect prior to
March 30, 1994. If Mr. Karmazin's employment terminates prior to the
end of a fiscal year, he will be entitled to a prorated award if the
EBITDA target, as prorated, was met.
EBITDA Target Awards granted to Mr. Karmazin under the Option
Plan (See "Proposal to Approve Amendments to Option Plan --
Amendments Relating to Section 162(m)", above) will be deemed to
have been awarded to him pursuant to the amended employment agreement
and will also count toward Mr. Karmazin's Option Plan award limits.
If the applicable EBITDA Target is exceeded, Mr.
Karmazin will be entitled to receive a number of Class B Deferred Shares
(as defined below) (Class A Deferred Shares may be awarded to the extent
Class B Deferred Shares are not available for award under the Company's
Deferred Share Plan) determined by (a) multiplying each Increment, as
defined below, by the applicable Applied Percentage, and (b) dividing
the sum of the resulting products by an amount equal to 85% of the
Fair Market Value of a Class B Share as of the last day of the
period for which the award is made. "Deferred Shares" are Class A
Shares or Class B Shares that are issuable upon the occurrence of a
"Trigger Event" specified in the Company's Deferred Share Plan
and the recipient's payment of the par value of each Deferred Share.
Upon delivery, a recipient of Deferred Shares is also entitled to
receive with respect to each Deferred Share an amount equal to all
dividends or other distributions made in respect of a share of Common
Stock since the date on which the Deferred Shares were granted.
<TABLE>
<CAPTION>
Maximum Maximum
Amount by Which Actual Applied Increment Aggregate
EBITDA Exceeds the Percentage Cash Cash
EBITDA Target ("Increment") Value Value
___________________________ ___________ __________ __________
<C> <C> <C> <C>
0 - $1,000,000 3% $30,000 $ 30,000
$1,000,001 - 2,000,000 4% 40,000 70,000
2,000,001 - 3,000,000 5% 50,000 120,000
3,000,001 - 4,000,000 5% 50,000 170,000
4,000,001 - 5,000,000 5% 50,000 220,000
5,000,000 - or more 5%
</TABLE>
The increment and cash value amounts specified in the
employment agreement, as amended, are identical to those specified in
the agreement as in effect prior to March 30, 1994. Deferred Shares
and options awarded pursuant to the employment agreement for a fiscal
year of the Employer will be awarded no later than the thirtieth day
following the Company's filing of its report on Form 10-K with the SEC
for such year. All Deferred Shares awarded to Mr. Karmazin pursuant
to the amended employment agreement will be fully vested at the date
of grant.
NEW PLAN BENEFITS
Awards under the Option Plan and Bonus Plan are made at
the discretion of the Compensation Committee, which has discretion to
award less than the maximum amount permitted under the plans.
Accordingly, the benefits and amounts that will be received by or
allocated to each of the following under the Option Plan, as amended,
and the Bonus Plan are not determinable. All awards under the Option
plan and the Bonus Plan are granted in consideration of services
performed for the Company. Awards granted to Mr. Karmazin pursuant
to the amended provisions of his employment agreement will be counted
against his applicable award limits under the Option Plan and Bonus
Plan.
28
<PAGE>
The following table, which is required to be presented under rules of
the Securities and Exchange Commission, identifies, for illustrative
purposes, the cash bonus and option awards received by each of the
following pursuant to the Option Plan or the cash bonus incentive
compensation provisions of an applicable employment agreement in 1993.
<TABLE>
<CAPTION>
Option Plan Bonus Plan
Name and Position Number of Units Dollar Value ($)
_______________________________ __________________ _________________
<S> <C> <C>
Mel Karmazin, President, Chief 112,500 (1), (2) 269,000 (3)
Executive Officer, and Director
Michael A. Wiener, Chairman of 0 0
the Board and Secretary
Gerald Carrus, Co-Chairman of 0 0
the Board and Treasurer
Farid Suleman, Vice President- 161,250 (4) 0
Finance, Chief Financial Officer
and Director
Executive Group 273,750 269,000
Non-Executive Director Group 45,000 (5) 0
Non-Executive Officer Employee 757,500 0
Group
<FN>
Notes to New Plan Benefits Table
________________________________
(1) Represents option awarded on April 30, 1993, in accordance with
Mr. Karmazin's employment agreement upon the Company's attainment of
its 1992 EBITDA target. Such option, for the purchase of 112,500 Class
B Shares at a per share exercise price of $9.26 (85% of the closing
price of a Class A Share on December 31, 1992), was exercisable
immediately upon grant and will remain exercisable for ten years
from the date of grant.
(2) The closing market price of a Class A Share on April 30,
1993, as reported on the NASDAQ National Market System, was $14.44.
(3) Represents cash bonus incentive compensation award paid in 1993
pursuant to Mr. Karmazin's employment agreement (as in effect on
such date) upon the Company's attainment of its 1993 EBITDA
performance goal. This amount was included in the special bonus paid
to Mr. Karmazin in December 1993 in recognition of the Company's
performance in 1993 (see "Executive Compensation -- Summary
Compensation Table" and "Executive Compensation -- Report of the
Board of Directors on Executive Compensation," above).
(4) Represents aggregate number of options for the purchase of Class A
Shares, exercisable at a price of $7.78 per share with respect to
67,500 of such shares and $8.78 per share with respect to 56,250 of
such shares, and $26.00 per share with respect to 37,500 of such
shares, granted in 1993. Each exercise price is equal to the closing
price of a Class A Share on the date of grant or on the date on which
such grant was recommended to the Compensation Committee, as the case
may be. Such options become exercisable over a four-year period of
service beginning on June 30, 1993 with respect to 67,500 of such
shares, a five-year period of service beginning on September 15, 1992
with respect to 56,250 of such shares, and a five-year period of
service beginning on September 21, 1993 with respect to 37,500 of such
shares.
(5) Represents aggregate number of options for the purchase of Class A
Shares awarded to Messrs. Batkin and Simpson in 1993, with a per share
exercise price of $8.78 (the closing price of a Class A Share on
September 15, 1992, the date on which such grants were recommended to the
29
<PAGE>
Compensation Committee). Such options become exercisable over a
five-year period of service beginning on September 15, 1992.
</TABLE>
The Board may amend, terminate, alter, suspend or modify the
Option Plan, except that the approval of the holders of the
outstanding shares of Common Stock, in the manner required by Rule
16b-3, is necessary to materially increase the total number of shares
that may be issued or transferred under the Option Plan, to reduce
the minimum purchase price for the shares subject to options, to
extend the maximum period during which options may be exercised, to
materially increase the benefits accruing to the
participants under the Option Plan, to modify materially the
requirements as to eligibility for participation in the Option Plan
or to extend the period during which options may be granted under the
Option Plan. The Board may terminate, alter, suspend, modify or amend
the Bonus Plan. Mr. Karmazin's employment agreement may be
changed, modified or amended with the affirmative vote of a majority
of the Board (including for this purpose at least two-thirds of
the members of the Board) and the written consent of Mr.
Karmazin and the Company.
STOCKHOLDER PROPOSALS FOR 1995
Under the rules of the Commission, any stockholder proposal
intended for inclusion in the proxy material for the annual meeting of
stockholders to be held in 1995 must be received by the Company by
January 3, 1995 to be eligible for inclusion in such proxy material.
Proposals should be addressed to Michael A. Wiener, Secretary,
Infinity Broadcasting Corporation, 600 Madison Avenue, New York, N.Y.
10022. Proposals must comply with the proxy rules of the Commission
relating to stockholder proposals in order to be included in the proxy
materials.
GENERAL
The Company's Annual Report on Form 10-K for the year ended
December 31, 1993, including consolidated financial statements and
other information (the "1993 Annual Report"), accompanies this Proxy
Statement but does not form a part of the proxy soliciting material. A
complete list of the stockholders of record entitled to vote at the
Annual Meeting will be open and available for examination by any
stockholder, for any purpose germane to the meeting, between 9:00 A.M.
and 5:00 P.M. at the Company's offices at 600 Madison Avenue, New
York, New York from May 27, 1994 to the date of the meeting.
Although the 1993 Annual Report is being provided to
stockholders, in accordance with applicable rules of the Commission, the
Company notes the following:
The Company will provide each of its stockholders, without
charge, upon the written request of any such person, a copy of the
1993 Annual Report, required to be filed with the Commission pursuant
to Rule 13a-1 under the Exchange Act for the Company's most
recent fiscal year. Exhibits to the 1993 Annual Report will not be
supplied unless specifically requested, for which there may be a
reasonable charge. Those stockholders wishing to obtain a copy of
the 1993 Annual Report should submit a written request to:
Michael A. Wiener, Secretary, Infinity Broadcasting Corporation,
600 Madison Avenue, New York, New York 10022.
30
<PAGE>
In addition to solicitation by mail, proxies may be
solicited in person, or by telephone or telegraph, by directors and
by officers and other regular employees of the Company. All expenses in
connection with the preparation of proxy material and the solicitation
of proxies will be borne by the Company.
By Order of the Board of Directors
__________________________________________
May 2, 1994 Michael A. Wiener
Chairman of the Board and Secretary
31
<PAGE>
Exhibit A
AMENDMENTS TO THE
INFINITY BROADCASTING CORPORATION
STOCK OPTION PLAN
_________________________________
The following amendments to the Infinity Broadcasting
Corporation Stock Option Plan (the "Plan"), as amended and restated as
of August 16, 1993, and amended as of November 19, 1993, will become
effective upon approval by the stockholders of the Company:
1. Subsection 2(a) of the Plan ("Shares") is amended so
that the first clause of the first sentence thereof reads as
follows:
"Subject to adjustment as provided in Section 9
and to the last sentence of this subsection,";
and is further amended by adding a new final sentence thereto,
reading as follows:
"Subject to adjustment as provided in Section 9,
the aggregate number of Class A shares set forth
in the first sentence of this subsection is hereby
increased by 2,000,000, and the aggregate number of
Class B Shares set forth in such sentence is hereby
increased by 600,000."
2. Section 5 of the Plan ("Granting of Options") is amended
to read in its entirety as follows:
"(a) Eligibility, Grant of Options and Selection of Optionees.
______________________________________________________________
The Administrator shall have authority, within ten
years after September 10, 1990, to grant to such key
employees (including officers and directors who are
employees) and non-employee directors of the Company and
its present and future subsidiaries as may be selected by
it ("Optionees"), options to purchase Shares. All
options granted hereunder shall be granted on the terms and
conditions hereinafter set forth. In selecting Optionees,
and in determining the number of Shares to be covered by
each option, the Administrator may consider the office or
position held by the Optionee, the Optionee's degree of
responsibility for and contributions to the growth and
success of the Company, the Optionee's potential or any
other performance factors which it may consider relevant.
Appropriate officers of the Company are hereby authorized
to execute and deliver option agreements in the name of
the Company, in the form and as directed from time to
time by the Administrator.
"(b) Annual Maximum Number of Shares Subject to Award.
______________________________________________________
The following provisions shall apply to option awards
made in fiscal years of the Company beginning on or after
January 1, 1994 (each, a "Plan Year"). In the first Plan
Year in which an award is made to an Optionee, the
Administrator may grant such Optionee Options for the
purchase of up to 200,000 Shares. The maximum number of
Shares as to which Options may be awarded to such Optionee
in each succeeding Plan Year shall be (x) 200,000 plus (y)
the excess, if any, of (1) the maximum award that could
have been made to such Optionee in the most recent Plan
Year in which such Optionee received an award hereunder
over (2) the total number of Shares as to which options
were awarded to such Optionee in such most recent Plan Year
(including awards, if any, made under subsection 5(c))
(such excess being referred to as the "Additional
A-1
<PAGE>
Amount"). In no event shall any Optionee's Additional
Amount exceed 300,000 Shares for any Plan Year.
"(c) Certain Awards. The Administrator shall
___________________
have the authority, prior to the beginning of each Plan Year
(or at such later time as may be permitted under
Section 162(m) of the Code (as defined below)), to
establish in writing an EBITDA target (the "EBITDA Target")
for such Plan Year and to make an award of options for
the purchase of up to 112,500 Shares to any Eligible
Optionee upon the Company's attainment of such EBITDA
Target (or the attainment of a prorated portion of such
target, as determined by the Administrator in the case of an
award in respect of a period shorter than a Plan Year).
The maximum number of Shares as to which options may be
awarded pursuant to this subsection 5(c) shall be prorated
in the event of an award in respect of a period shorter
than a Plan Year. The per Share exercise price of any
option awarded pursuant to this subsection 5(c) shall be
85% of the Fair Market Value of a Share as of the last
day of the period for which the award is made. Any option
granted pursuant to this Section 5(c) shall be immediately
exercisable and shall expire ten years after the date
of grant. For the purposes of the Plan: the term
"EBITDA" means earnings of the Company and its
consolidated subsidiaries before interest, taxes,
depreciation and amortization, as reported in the Company's
report on Form 10-K for the Plan Year or, if for a portion
of a Plan Year, as approved by the Board based on the
Company's books and records; the term "Eligible Optionee"
means the Company's Chief Executive Officer and any other
senior executive officer of the Company designated as an
Eligible Optionee by the Board prior to the commencement of
the applicable Plan Year (or, if later, prior to the
commencement of such individual's service as a senior
executive officer or such other time as may be specified
under Section 162(m) of the Code (as defined below)); and
the term "Fair Market Value" means, with respect to any
Share, the closing price of a Class A Share (as reported
on the NASDAQ National Market System) on the date as of
which the determination is made, in the event no price is
so reported, the fair market value of a Class A Share on
such date, as determined in good faith by the Administrator.
"(d) Time of Granting Option. Nothing contained in
______________________________
the Plan or any resolutions adopted or to be adopted by
the Board or the stockholders of the Company shall
constitute the granting of any option hereunder. Options
shall be granted only by action of or pursuant to the
authority of the Administrator; provided, however, that no
participant shall have any rights with respect to such
grant unless and until he or she shall have executed
and delivered an option agreement in form and substance
satisfactory to the Administrator."
3. Subsection 10(b) of the Plan ("No Right to
Employment") is amended by the addition of the following clause at
the end of the final sentence thereof:
"; provided that awards made pursuant to subsection 5(c)
________
hereof shall be deemed for purposes of an applicable
employment agreement to have been made pursuant thereto to
the extent such agreement provides for such awards."
A-2
<PAGE>
INFINITY BROADCASTING CORPORATION
STOCK OPTION PLAN
(formerly the Infinity Broadcasting Corporation
Key Employee Stock Option Plan)
_______________________________________________
1. Purpose.
_______
This plan, which was formerly known as the Infinity
Broadcasting Corporation Key Employee Stock Option Plan and shall be
known as the Infinity Broadcasting Corporation Stock Option Plan (the
"Plan"), is intended to promote the interests of Infinity Broadcasting
Corporation (the "Company") and its stockholders by encouraging long-
term growth of the Company's earnings by offering to those key employees
and non-employee directors of the Company and its subsidiaries who have
been or will be largely responsible for such growth the opportunity to
acquire equity interests or increase their equity interests in the
Company, thereby aligning their interests more closely with the
interests of stockholders, and by encouraging key employees and
non-employee directors to remain in the service of the Company and its
subsidiaries and providing a basis for attracting able employees and
non-employee directors in the future.
2. Shares Subject to the Plan.
__________________________
(a) Shares. Subject to adjustment as provided in
______
Section 9, the aggregate number of shares of the Class A Common Stock of
the Company ("Class A Shares") to be delivered upon exercise of all
options granted under the Plan shall be 1,776,233, and the aggregate
number of shares of the Class B Common Stock of the Company ("Class B
Shares" and, together with Class A Shares, "Shares") to be delivered
upon exercise of all options granted under the Plan shall be 125,000.
Such Shares may be authorized but unissued Shares or treasury Shares.
In the event the number of Shares to be delivered upon the exercise in
full of any option granted under the Plan is reduced for any reason
whatsoever, or in the event any option granted under the Plan can no
longer under any circumstances be exercised, the number of Shares no
longer subject to such option shall thereupon be released from such
option and shall thereafter be available to be re-optioned under the
Plan. All Shares issued pursuant to the exercise of options granted
under the Plan shall be fully paid and non-assessable.
1
<PAGE>
(b) Right of First Refusal. All Shares issued
______________________
pursuant to the exercise of options granted under the Plan shall be
subject to a right of first refusal by the Company at a value determined
in good faith by the Board of Directors of the Company (the "Board") in
its sole discretion, which value shall in no case be less than the par
value of such Shares, unless at such time the Company shall be sub- ject
to the informational requirements of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and in accordance therewith files
reports and other information with the Securities and Exchange
Commission. A holder of Shares who receives a bona fide offer shall,
within 30 days thereof, notify the Company of such offer and the
proposed date of sale. The Company shall exercise its right of first
refusal by (i) notifying the holder of such Shares, within 30 days of its
_
receipt of such notice, of its intention to purchase all, but not less
than all, of the Shares subject to the bona fide offer and (ii) tendering
__
full payment for such Shares. Once the Company has tendered payment
with respect to any such Shares, the Optionee's sole right with respect
to such Shares shall be the right to the payment so tendered. The
Board's determination of the amount to be paid to the Optionee shall be
binding.
(c) Right to Repurchase Shares. All Shares
__________________________
issued pursuant to this Plan shall be subject to the right of the
Company to repurchase such Shares at a value determined in good faith
by the Board in its sole discretion, upon the termination of employment
(including the termination of all service as a director of the
Company, its parents and subsidiaries, in the case of an Optionee who
is a director of any such entity but is not an employee of any such
entity) of the Optionee with respect to whom such Shares were issued
unless, at the time of such termination of employment, the Company shall
be subject to the informational requirements of the Act, and in
accordance therewith files reports and other information with the
Securities and Exchange Commission. The Company shall exercise such
right by (i) notifying the Optionee within thirty days of the date of
_
his termination of its intention to repurchase all, but not less than
all, of its Shares issued to such Optionee pursuant to the Plan and (ii)
__
tendering full payment for the Shares. Once the Company has tendered
payment with respect to any such Shares, an Optionee's sole right with
respect to such Shares shall be the right to the payment so tendered.
The Board's determination of the amount to be paid to the Optionee shall
be binding. The Company is not, however, obligated to purchase any
Shares under the Plan.
2
<PAGE>
3. Effective Date, Amendments.
__________________________
(a) The Plan was adopted on October 27, 1988 and became
effective ("Effective Date") on October 27, 1988, upon approval by the
holders of a majority of all the outstanding Shares of voting stock of
the Company entitled to vote thereon.
(b) Amendment Date. The Plan was amended on September 10, 1990,
______________
effective as of the same date (the "Amendment Date"), upon approval of
the holders of a majority of all of the outstanding Shares of voting
stock of the Company entitled to vote thereon. The Plan was amended and
restated effective February 4, 1992, upon the approval of the holders of
a majority of all outstanding shares of voting stock of the Company
entitled to vote thereon, and was further amended effective as of August
18, 1992, upon the approval of the Company's stockholders in accordance
with Rule 16b-3 under the Exchange Act.
(c) The Plan was amended, restated and renamed, effective as
of July 26, 1993, the date on which the Company's stockholders approved
the amendments to Sections 1, 5 and 7 reflected herein in accordance
with Rule 16b-3 under the Exchange Act, except that the amendments
reflected here-in to Section 4 of the Plan became effective as of
February 4, 1992. (d) The Plan was further amended, effective as of
August 16, 1993, to reflect the Company's three-for-two stock split in
the form of a 50% stock dividend.
4. Administration.
______________
(a) The Administrator. The term "Administrator" as used herein
_________________
shall mean a committee appointed by the Board and consisting of two or
more members of the Board, each of whom is a "disinterested person"
within the meaning of Rule 16b-3 under the Exchange Act.
(b) Authority. Subject to the provisions of the Plan, the
_________
Administrator shall interpret the Plan and the options granted under the
Plan, shall make all other determinations necessary or advisable for the
administration of the Plan and shall correct any defect or supply any
omission or reconcile any inconsistency in the Plan or in any option, in
the manner and to the extent the Administrator deems desirable to carry
the Plan or option into effect. The
3
<PAGE>
Administrator may, with the consent of the person or persons entitled to
exercise any outstanding option, amend such option consistent with the
provisions of the Plan. In granting options pursuant to Section 5
hereof to persons other than the Chief Executive Officer of the Company
(the "CEO"), the Administrator may consider recommendations by the CEO
in addition to the other factors set forth in Section 5.
(c) Procedure. All determinations of the Administrator shall
_________
be made by not less than a majority of its members at a meeting at which
a quorum is present. A majority of the entire Administrator shall
constitute a quorum for the transaction of business. Any action
required or permitted to be taken at a meeting of the Administrator may
be taken without a meeting, if a unanimous written consent which sets
forth the action is signed by each member of the Administrator and filed
with the minutes of proceedings of the Administrator. No member of the
Administrator shall be liable, in the absence of bad faith, for any act
or omission with respect to his services. Without limiting the
generality of the foregoing, no member of the Administrator shall be
liable for any action or determination made in good faith with respect
to the Plan or to any option granted thereunder.
5. Granting of Options.
___________________
(a) Eligibility, Grant of Options and Selection of Optionees.
________________________________________________________
The Administrator shall have authority within ten years of the
Effective Date of the Plan, to grant to such key employees (including
officers and directors who are employees) and non-employee directors of
the Company and its present and future subsidiaries as may be selected
by it ("Optionees"), options to purchase Shares. The Administrator
shall have the further authority within ten years after the Amendment
Date to grant to Optionees options to purchase Shares. All options
granted hereunder shall be granted on the terms and conditions
hereinafter set forth. In selecting Optionees, and in determining the
number of Shares to be covered by each option, the Administrator may
consider the office or position held by the Optionee, the Optionee's
degree of responsibility for and contributions to the growth and success
of the Company, the Optionee's potential or any other performance
factors which it may consider relevant. Appropriate officers of the
Company are hereby authorized to execute and deliver option agreements
in the name of the Company, in the form and as directed from time to
time by the Administrator.
4
<PAGE>
(b) Time of Granting Option. Nothing contained in the Plan or
_______________________
any resolutions adopted or to be adopted by the Board or the stockholders
of the Company shall constitute the granting of any option hereunder.
Options shall be granted only by action of or pursuant to the authority
of the Administrator; provided, however, that no participant shall have
any rights with respect to such grant unless and until he or she shall
have executed and delivered an option agreement in form and substance
satisfactory to the Administrator.
6. Option Price.
____________
Minimum Option Price. The option price per Share of the Common
____________________
Stock underlying each option shall be fixed by the Administrator.
7. Terms and Conditions of Options.
_______________________________
Options granted under the Plan shall be in such form as the
Administrator may from time to time approve, subject to the following
terms and conditions, and may contain such additional terms and
conditions (which terms and conditions need not be the same in each
case), including restrictions against competition by the Optionee, not
inconsistent with the Plan, as the Administrator shall deem desirable:
(a) Option Period and Conditions and Limitations on Exercise.
________________________________________________________
The options shall be exercisable in full or in installments at such
time or times as the Administrator, in its sole discretion, may
determine. The right to purchase shall be cumulative so that if the
full number of the Shares purchasable in any period shall not be
purchased, the balance may be purchased at any time from time to time
thereafter prior to the expiration of the option term as established by
the Administrator. No stock option shall be exercisable with respect to
any of the Shares subject to the option later than ten years from the
date of grant. The date on which an option ultimately becomes
unexercisable is hereinafter referred to as the Option Expiration Date.
To the extent not prohibited by other provisions of the Plan, each
option shall be exercisable at such time or times and subject to such
conditions as are set forth in the option.
(b) Termination of Employment, Disability and Death.
________________________________________________
For purposes of the Plan and each option granted under the Plan, an
Optionee's employment shall be deemed to
5
<PAGE>
have terminated at the close of business on the day preceding the first
date on which he is no longer for any reason whatsoever employed by the
Company or any parent or subsidiary of the Company (or, in the case of a
non-employee director, at the close of business on the day preceding the
first date on which he no longer serves as a director of the Company or
of any of its parents or subsidiaries). Unless otherwise provided in an
applicable option agreement, if an Optionee's employment is terminated
for any reason whatsoever the right to exercise said option shall
terminate:
(1) At the expiration of thirty days after the Optionee's
employment is terminated;
(2) At the expiration of three months after the Optionee
ceases to receive wages through the Company's or a subsidiary's payroll
because of disability, within the meaning of Section 22(e)(3) of the
Internal Revenue Code of 1986, as amended (the "Code"). The determina-
tion of the Administrator on any question involving disability shall be
conclusive and binding; or
(3) At the expiration of three months after the Optionee's
death if the Optionee's employment is terminated by reason of death or
if the Optionee had a right to exercise an option on the date of death
pursuant to Section 7(b)(1) or (2); and prior to such date such option
may be exercised by the estate or by the person or persons who acquire
the right to exercise such option by bequest or inheritance with respect
to any or all of the Shares remaining subject to such option at the time
of the Optionee's death.
An option exercised after cessation of employment by an
Optionee for any reason may, subject to adjustment as provided in
Section 9, be exercised only with respect to the number of Shares which
the Optionee could have acquired by an exercise of the option
immediately prior to the cessation of such employment. In no event may
an option be exercised after its Option Expiration Date. The
Administrator may adopt, amend or rescind from time to time such
provisions as it deems appropriate with respect to the effect of leaves
of absence approved by any duly authorized officer of the Company or
any subsidiary with respect to any Optionee.
(c) Options Not Transferable. An option shall not be transferable
________________________
otherwise than by will or by the laws of descent and distribution or
pursuant to a qualified domestic
6
<PAGE>
relations order as defined by the Code or Title I of the Employee
Retirement Income Security Act of 1974, as amended (or the rules
thereunder), and during the lifetime of the Optionee shall be
exercisable only by the Optionee. Any attempt to transfer, assign,
pledge, hypothecate or otherwise dispose of, or to subject to execution,
attachment or similar process, any option other than as permitted in the
preceding sentence, shall give no right to the purported transferee.
(d) Legal Limitations. Notwithstanding any provision of
_________________
the Plan or the terms of any option issued pursuant to the Plan, the
Company shall not be required to issue any Shares hereunder if such
issuance would, in the judgment of the Administrator, constitute a
violation of any state or federal law, or of the rules or regulations of
any governmental regulatory body, or any securities exchange.
8. Exercise and Payment.
____________________
(a) Exercise. In order to exercise an option under the Plan,
________
the person or persons entitled to exercise it shall deliver to the
Company written notice of the number of full Shares with respect to
which such option is to be exercised accompanied by payment in full for
the Shares being purchased plus, in the case of a nonqualified option,
any required withholding tax. No fractional Shares will be issued. The
payment of the option exercise price shall be in cash. The withholding
tax shall be paid in cash or through a payroll deduction no later than
the next payroll cycle.
(b) Award of Cash or Shares in Lieu of Exercise.
___________________________________________
An Option Agreement may provide that, in lieu of accepting payment of
the option price and delivering any or all Shares as to which an option
has been exercised, the Administrator, in its sole discretion, may elect
to pay the holder of such option an amount in cash or Shares, or a
combination of cash and Shares, equal to the amount by which the fair
market value on the date of exercise of the Shares as to which such
option has been exercised exceeds the purchase price that would
otherwise be payable by the holder of such option to acquire such
Shares.
(c) Rights as a Stockholder. The person or persons entitled
_______________________
to exercise, or who have exercised, an option shall not be entitled to
any rights as a stockholder of the
7
<PAGE>
Company with respect to any Shares subject to the option until such
person or persons shall have become the holder of record of such Shares.
9. Adjustment of Shares.
____________________
(a) In the event that any time after the Effective Date of
the Plan the outstanding Shares are changed into or exchanged for a
different number or kind of Shares of the Company or other securities of
the Company by reason of merger, consolidation, recapitalization,
reclassification, stock split, stock dividend or combination of Shares,
the Administrator shall make an appropriate and equitable adjustment in
the number and kind of Shares subject to outstanding options, or
portions thereof then unexercised, and the number of Shares subject to
the Plan, to the end that after such event the Shares subject to the
Plan and the Optionee's right to a proportionate interest in the Company
shall be maintained as before the occurrence of such event. Such
adjustment in an outstanding option shall be made without change in the
total price applicable to the option or the unexercised portion of the
option (except for any change in the total price resulting from
rounding-off Share quantities or prices) and with any necessary
corresponding adjustment in option price per Share. Any such adjustment
made by the Administrator shall be final and binding upon all Optionees,
the Company and all other interested persons. Any adjustment of an
incentive stock option under this paragraph shall be made in such manner
so as not to constitute a "modification" within the meaning of Section
424(h)(3) of the Code. The Administrator, in its sole discretion, may
at any time make or provide for such adjustments to the Plan or any
option granted thereunder as it shall deem appropriate to prevent the
reduction or enlargement of rights, including adjustments in the event
of changes in the outstanding Class A Common Stock or Class B Common
Stock by reason of mergers, consolidations, combinations or exchanges of
shares, separations, reorganizations, liquidations and the like in which
the Company is not the sole surviving successor to the assets or
business of the Company immediately prior thereto. In the event of any
offer to holders of Class A Common Stock or Class B Common Stock
generally relating to the acquisition of their shares, the Administrator
may make such adjustments as it deems equitable in respect of
outstanding options. Any such determination of the Administrator
pursuant to this Section shall be conclusive.
8
<PAGE>
(b) In the event of a merger or consolidation of the Company
or the acquisition of all or substantially all of the outstanding common
stock of the Company resulting in the exchange or payment of other
consideration for Shares, each option authorized or awarded under this
Plan shall be deemed to represent the right to receive, upon fulfillment
of the terms and conditions of this Plan and an applicable award
agreement, the consideration the holder or recipient of such option
would have received had the option been an outstanding Share immediately
prior to the consummation of such transaction.
10. Limitations.
___________
(a) Authority Limited to Administrator. No person shall at
__________________________________
any time have any right to receive an option hereunder and no person
shall have authority to enter into an agreement for the granting of an
option or to make any representation or warranty with respect thereto,
except as granted by the Administrator, as provided in the Plan.
Optionees shall have no rights in respect to their options except as set
forth in the Plan.
(b) No Right to Employment. Neither the action of the
______________________
Company in establishing the Plan, nor the action taken by it or by the
Administrator under the Plan, nor any provision of the Plan, shall be
construed as giving to any person the right to be retained in the employ
of the Company or any subsidiary or as giving to any person the right to
be retained as a director of the Company or any subsidiary. No
provision of the Plan will supersede any terms of any employment
agreements that an Optionee may have with the Company.
11. Amendments and Termination.
__________________________
The Board may terminate, alter, suspend, modify or amend the
Plan in such respects as it shall deem advisable. Except as otherwise
provided in Section 9, no action of the Board may, without the approval
of security holders in the manner required by subsection (b) of Rule
16b-3, (i) increase materially the aggregate number of Shares as
_
to which options may be granted or which may be issued under the Plan,
(ii) reduce the minimum option price, (iii) extend the period within
__ ___
which options may be exercised, (iv) extend the period during which
__
options may be granted, (v) increase materially the benefits accruing to
_
participants under the Plan, or (vi) modify materially the requirements as to
__
9
<PAGE>
eligibility for participation in the Plan. No termination, alteration,
suspension, modification or amendment of the Plan may, without the
consent of the Optionee to whom any option shall theretofore have been
granted, adversely affect the rights of such Optionee under any such
option then outstanding.
12. Use of Certain Terms.
____________________
The terms "parent" and "subsidiary" shall have the meanings
ascribed to them in Section 424 of the Code and unless the context
otherwise requires, the other terms used in the Plan which correspond to
like terms defined in Sections 421 through 424, inclusive, of the Code
and regulations and revenue rulings applicable thereto, shall have the
meanings attributed to them therein.
IN WITNESS WHEREOF, the Company has caused its duly authorized
officer to execute this restated plan document as of the 16th day of
August, 1993.
INFINITY BROADCASTING CORPORATION
By: /s/ Farid Suleman
______________________________
10
<PAGE>
CONFORMED COPY
AMENDMENT TO THE
INFINITY BROADCASTING CORPORATION
STOCK OPTION PLAN
_________________________________
The Infinity Broadcasting Corporation Stock Option Plan (the
"Plan"), as amended and restated as of August 16, 1993, is hereby
further amended as follows to reflect the Company's three-for-two stock
split in the form of a stock dividend, effective as of November 19,
1993:
Section 2(a) of the Plan ("Shares") is amended so that the
first sentence thereof reads in its entirety as follows:
"Subject to adjustment as provided in Section 9, the aggregate
number of shares of the Class A Common Stock of the Company
("Class A Shares") to be delivered upon exercise of all
options granted under the Plan shall be 2,664,350 and the
aggregate number of shares of the Class B Common Stock of the
Company ("Class B Shares" and, together with Class A Shares,
"Shares") to be delivered upon exercise of all options granted
under the Plan shall be 187,500."
IN WITNESS WHEREOF, the Company has caused its duly authorized
officer to execute this amendment instrument as of the 19th day of
November, 1993.
INFINITY BROADCASTING CORPORATION
By /s/ Farid Suleman
_______________________________
Title Vice President-Finance and
Chief Financial Officer
1
<PAGE>
CONFORMED COPY
AMENDMENT TO THE
INFINITY BROADCASTING CORPORATION
STOCK OPTION PLAN
_________________________________
The Infinity Broadcasting Corporation Stock Option Plan (the
"Plan"), as amended and restated as of August 16, 1993, and amended as
of November 19, 1993, is further amended as follows, effective as of the
date on which the following amendment to Section 2 of the Plan, and the
material terms of the following amendment to Section 5 of the Plan, are
approved by the Company's stockholders in accordance with the
requirements of Rule 16b-3 under the Securities Exchange Act of 1934, as
amended, and Section 162(m) of the Internal Revenue Code of 1986, as
amended, respectively:
1. Subsection 2(a) of the Plan ("Shares") is amended so that
the first clause of the first sentence thereof reads as follows:
"Subject to adjustment as provided in Section 9 and to the
last sentence of this subsection,";
and is further amended by adding a new final sentence thereto, reading
as follows:
"Subject to adjustment as provided in Section 9, the aggregate
number of Class A shares set forth in the first sentence of
this subsection is hereby increased by 2,000,000, and the
aggregate number of Class B Shares set forth in such sentence
is hereby increased by 600,000."
1
<PAGE>
2. Section 3 of the Plan ("Effective Date; Amendments") is
awarded to read in its entirety as follows:
"The Plan was adopted in October 27, 1988 and became effective
on that date upon approval by the holders of a majority of all
outstanding Shares of voting stock of the Company entitled to
vote thereon. The Plan was thereafter amended effective as of
September 10, 1990, February 4, 1992, August 18, 1992, July
26, 1993, August 15, 1993 and November 19, 1993. The Plan is
hereby amended, effective as of [June 13, 1994]."
3. Section 4 of the Plan ("Administration") is amended, for
purposes of clarity, so that the final sentence of subsection "(c)"
thereof reads as follows:
"Without limiting the generality of the foregoing or the scope
of any applicable provision of the Company's Charter or By-
Laws or any indemnification agreement, no member of the
Administrator shall be liable for any action or determination
made in good faith with respect to the Plan or any option
granted thereunder."
4. Section 5 of the Plan ("Granting of Options") is amended
to read in its entirety as follows:
"(a) Eligibility, Grant of Options and Selection of
______________________________________________
Optionees. The Administrator shall have authority, within ten
_________
years after September 10, 1990, to grant to such key employees
(including officers and directors who are employees) and non-
employee directors of the Company and its present and future
subsidiaries as may be selected by it ("Optionees"), options
to purchase Shares. All options granted hereunder shall be
granted on the terms and conditions hereinafter set forth. In
selecting Optionees, and in determining the number of Shares
to be covered by each option, the Administrator may consider
the office or position held by the Optionee, the Optionee's
degree of responsibility for and contributions to the growth
and success of the Company, the Optionee's potential or any
other performance factors which it may consider relevant.
Appropriate officers of the Company are hereby authorized to
execute and de-
2
<PAGE>
liver option agreements in the name of the
Company, in the form and as directed from time to time by the
Administrator.
"(b) Annual Maximum Number of Shares Subject to Award.
________________________________________________
The following provisions shall apply to option awards made in
fiscal years of the Company beginning on or after January 1,
1994 (each, a "Plan Year"). In the first Plan Year in which
an award is made to an Optionee, the Administrator may grant
such Optionee Options for the purchase of up to 200,000
Shares. The maximum number of Shares as to which Options may
be awarded to such Optionee in each succeeding Plan Year shall
be (x) 200,000 plus (y) the excess, if any, of (1) the maximum
_ _ _
award that could have been made to such Optionee in the most
recent Plan Year in which such Optionee received an award
hereunder over (2) the total number of Shares as to which
_
options were awarded to such Optionee in such most recent Plan
Year (including awards, if any, made under subsection 5(c))
(such excess being referred to as the "Additional Amount").
In no event shall any Optionee's Additional Amount exceed
300,000 Shares for any Plan Year.
"(c) Certain Awards. The Administrator shall have the
______________
authority, prior to the beginning of each Plan Year (or at
such later time as may be permitted under Section 162(m)), to
establish in writing an EBITDA target (the "EBITDA Target")
for such Plan Year and to make an award of options for the
purchase of up to 112,500 Shares to any Eligible Optionee upon
the Company's attainment of such EBITDA Target (or the
attainment of a prorated portion of such target, as determined
by the Administrator in the case of an award in respect of a
period shorter than a Plan Year). The maximum number of
Shares as to which options may be awarded pursuant to this
subsection 5(c) shall be prorated in the event of an award in
respect of a period shorter than a Plan Year. The per Share
exercise price of any option awarded pursuant to this
subsection 5(c) shall be 85% of the Fair Market Value of a
Share as of the last day of the period for which the award is
made. Any option granted pursuant to this Section 5(c) shall
be immediately exercisable and shall expire
3
<PAGE>
ten years after the date of grant. For the purposes of the Plan:
the term "EBITDA" means earnings of the Company and its
consolidated subsidiaries before interest, taxes, depreciation and
amortization, as reported in the Company's report on Form 10-K
for the Plan Year or, if for a portion of a Plan Year, as
approved by the Board based on the Company's books and
records; the term "Eligible Optionee" means the Company's
Chief Executive Officer and any other senior executive officer
of the Company designated as an Eligible Optionee by the Board
prior to the commencement of the applicable Plan Year (or, if
later, prior to the commencement of such individual's service
as a senior executive officer or such other time as may be
specified under Section 162(m) of the Code (as defined
below)); and the term "Fair Market Value" means, with respect
to any Share, the closing price of a Class A Share (as
reported on the NASDAQ National Market System) on the date as
of which the determination is made, in the event no price is
so reported, the fair market value of a Class A Share on such
date, as determined in good faith by the Administrator.
"(d) Time of Granting Option. Nothing contained in the
_______________________
Plan or any resolutions adopted or to be adopted by the Board
or the stockholders of the Company shall constitute the
granting of any option hereunder. Options shall be granted
only by action of or pursuant to the authority of the
Administrator; provided, however, that no participant shall
have any rights with respect to such grant unless and until he
or she shall have executed and delivered an option agreement
in form and substance satisfactory to the Administrator."
5. Subsection 10(b) of the Plan ("No Right to Employment") is
amended by the addition of the following clause at the end of the final
sentence thereof:
"; provided that awards made pursuant to subsection 5(c)
________
hereof shall be deemed for purposes of an applicable
employment agreement to have been made pursuant thereto to the
extent such agreement provides for such awards."
4
<PAGE>
6. The Plan is amended, for purposes of clarity, by the
addition of a new section 13 thereto, reading in its entirety as
follows:
"13. Governing Law.
_____________
The Plan shall be governed by and construed and enforced in
accordance with the laws of the State of New York, without
regard to principles of conflicts of law."
IN WITNESS WHEREOF, the Company has caused its duly authorized
officer to execute this amendment instrument as of the 30th day of
March, 1994.
INFINITY BROADCASTING CORPORATION
By /s/ Farid Suleman
________________________________
Title: Vice President-Finance and
Chief Financial Officer
5
<PAGE>
CONFORMED COPY
CASH BONUS COMPENSATION
PLAN OF
INFINITY BROADCASTING CORPORATION
_________________________________
1. Purpose.
_______
This plan, which shall be known as the Infinity Broadcasting
Corporation Cash Bonus Compensation Plan (the "Plan") is intended to
promote the interests of Infinity Broadcasting Corporation (the
"Company") and its stockholders by providing incentives for senior
executive officers of the Company to promote the growth of the Company's
earnings. Such incentives are intended to further align the interests
of such senior executive officers with the interests of the Company's
shareholders. The Company intends that bonus compensation payable
pursuant to this Plan shall constitute "performance-based compensation"
within the meaning of Section 162(m) of the Internal Revenue Code of
1986, as amended (the "Code"), and the regulations from time to time
promulgated thereunder ("Section 162(m)").
2. Eligible Employees.
__________________
The Company's Chief Executive Officer (the "CEO"), the
Company's Chief Financial Officer (the "CFO"), and such other senior
executive officers of the Company or its affiliates as may from time to
time be designated as Plan participants by the Company's Board of
Directors (the "Board") shall be eligible to receive cash bonus awards
under this Plan. The CEO, the CFO, and each other senior executive
officer designated prior to the commencement of a Plan Year (or, if
later, prior to the commencement of such individual's service as a
senior executive officer or such other time as shall be specified under
Section 162(m)) as a Plan participant for such Plan Year shall be an
"Eligible Participant" for such Plan Year.
3. Plan Year.
_________
The Plan Year shall be the fiscal year of the Company,
currently the calendar year. The 1994 calendar year shall be the first
Plan Year.
4. Effective Date.
______________
The Plan was adopted on March 30, 1994 and shall become
effective upon approval of the material terms hereof
1
<PAGE>
by the Company's stockholders in accordance with the requirements of
Section 162(m).
5. Administration.
______________
(a) The Administrator. The term "Administrator" as used
_________________
herein shall mean a committee appointed by the Board and consisting of
two or more members of the Board.
(b) Authority. Subject to the provisions of the Plan, the
_________
Administrator shall interpret the Plan and the awards granted under the
Plan, shall make all other determinations necessary or advisable for the
administration of the Plan and shall correct any defect or supply any
omission or reconcile any inconsistency in the Plan or in any award, in
the manner and to the extent the Administrator deems desirable to carry
the Plan or award into effect.
(c) Procedure. All determinations of the Administrator shall
_________
be made by not less than a majority of its members at a meeting at which
a quorum is present. A majority of the entire Administrator shall
constitute a quorum for the transaction of business. Any action
required or permitted to be taken at a meeting of the Administrator may
be taken without a meeting, if a unanimous written consent which sets
forth the action is signed by each member of the Administrator and filed
with the minutes of the proceedings of the Administrator. No member of
the Administrator shall be liable, in the absence of bad faith, for any
act or omission with respect to his services. Without limiting the
generality of the foregoing or the scope of any applicable provision of
the Company's Charter or By-Laws or any indemnification agreement, no
member of the Administrator shall be liable for any action or
determination made in good faith with respect to the Plan or any award
granted thereunder.
6. Awards.
______
(a) Establishment of EBITDA Target
______________________________
(i) General Rule. Prior to the beginning of each Plan Year
____________
(or at such other time as may be permitted under Section 162(m)), the
Administrator shall establish in writing an EBITDA target (the "EBITDA
Target") for such Plan Year.
2
<PAGE>
(ii) 1994 Plan Year. On or before March 31, 1994, the
______________
Administrator shall establish the EBITDA Target for the Plan Year
commencing January 1, 1994.
(b) Definition of EBITDA. As used in the Plan, the term
____________________
EBITDA means earnings of the Company and its consolidated subsidiaries
before interest, taxes, depreciation and amortization, as reported in
the Company's report on Form 10-K for the fiscal year or, if for a
portion of a Plan Year, as approved by the Company's Board of Directors
based on the Company's books and records.
(c) Awards. (i) If the EBITDA Target for the Plan Year has
______
been attained as of the last day of the applicable Plan Year, the
Administrator shall certify the attainment of such target and, following
such certification, may award any Eligible Participant who was employed
by the Company on the last day of the Plan Year a cash bonus. The
maximum cash bonus that may be awarded to any such Eligible Participant
with respect to the first Plan Year in which such participant is
eligible to receive an award hereunder shall be $1,500,000. The maximum
cash bonus that can be awarded to an Eligible Participant for each
succeeding Plan Year shall be the sum of (x) $1,500,000 and (y) the
_ _
excess, if any, of (A) the maximum cash bonus that could have been
_
awarded to such Eligible Participant for the most recent Plan Year with
respect to which such Eligible Participant could have received an award
hereunder over (B) the cash bonus amount actually awarded to such
_
Eligible Participant with respect to such most recent Plan Year (such
excess being referred to herein as the Eligible Participant's "Ad-
ditional Amount"). In no event shall any Eligible Participant's
Additional Amount exceed $1,500,000 for any Plan Year.
(ii) In the event an Eligible Participant's employment
terminates prior to the last day of a Plan Year, the Administrator shall
determine whether the EBITDA Target, prorated through the end of the
month in which such termination takes place, has been met. If such
prorated target has been met, the Administrator may, in its sole
discretion, award the Eligible Participant a cash bonus with respect to
such prorated portion of the Plan Year, provided that the amount of such
bonus shall in no event exceed a portion, prorated through the end of
the month in which such termination takes place, of the maximum bonus
amount applicable to the participant for the Plan Year, determined in
accordance with this subsection 6(c).
3
<PAGE>
(iii) Notwithstanding the Company's attainment of the EBITDA
Target for a Plan Year, the Administrator may, in its sole discretion,
award an Eligible Participant less than the maximum cash bonus and may
decline to award a bonus to an Eligible Participant. In determining
whether to award less than the maximum permissible bonus to an Eligible
Participant, the Administrator may take into account factors such as the
individual's office or position, levels of compensation paid by the Com-
pany's industry peers and competitors, the individual's degree of
responsibility for and contributions to the growth and success of the
Company, the individual's potential, the individual's conduct, or any
other performance factors it may consider relevant.
(d) Time of Granting Award. Nothing contained in the Plan or
______________________
any resolutions adopted or to be adopted by the Board or the
stockholders of the Company shall constitute the granting of any award
hereunder. Awards shall be granted only by action of or pursuant to the
authority of the Administrator.
(e) Payment of Awards. If an award is to be granted
_________________
hereunder, such award shall be declared and paid not later than the
thirtieth day following the filing by the Company of its Form 10-K with
the Securities and Exchange Commission for the applicable Plan Year or,
if the award is for part of the year, not later than the sixtieth day
following the end of the last month taken into account in determining
whether the EBITDA Target has been met. In the event the Administrator
does not declare an award permitted hereunder for an Eligible
Participant within such period, the Administrator shall be deemed to
have declined to make an award to such Eligible Participant with respect
to such Plan Year.
7. Limitations.
___________
(a) Authority Limited to Administrator. No person shall at
__________________________________
any time have any right to receive an award hereunder and no person
shall have authority to enter into an agreement for the granting of an
award or to make any representation or warranty with respect thereto,
except as granted by the Administrator, as provided in the Plan.
Eligible Participants shall have no rights in respect of their awards
except as set forth in the Plan.
(b) No Right to Employment. Neither the action of the
______________________
Company in establishing the Plan, nor the actions
4
<PAGE>
taken by it or by the Administrator under the Plan, nor any provision of
the Plan, shall be construed as giving to any person the right to be
retained in the employ of the Company or any affiliate or as giving to
any person the right to be retained as a director of the Company or any
affiliate. No provision of the Plan will supersede any terms of any
employment agreement that an Eligible Participant may have with the
Company; provided that bonuses payable pursuant hereto shall be
________
deemed for purposes of an applicable employment agreement to have been
paid pursuant thereto, to the extent such agreement provides for the
payment of cash bonus compensation.
(c) Awards Not Transferable. An award shall not be
_______________________
transferable otherwise than by will or by the laws of descent and
distribution. Any attempt to transfer, assign, pledge, hypothecate or
otherwise dispose of, or to subject to execution, attachment or similar
process any award, other than as permitted in the preceding sentence,
shall give no right to the purported transferee.
8. Amendments and Termination.
__________________________
The Board may terminate, alter, suspend, modify or amend the
Plan in such respects as it shall deem advisable. No termination,
alteration, suspension, modification or amendment of the Plan may,
without the consent of the Eligible Participant to whom any award shall
theretofore have been granted, adversely affect the rights of such
Eligible Participant under any such award then outstanding.
9. Governing Law.
_____________
The Plan shall be governed by and construed and enforced in
accordance with the laws of the State of New York, without regard to
principles of conflicts of law.
IN WITNESS WHEREOF, the Company has caused its duly authorized
officer to execute this plan document as of the 30th day of March, 1994.
INFINITY BROADCASTING CORPORATION
By: /s/ Farid Suleman
______________________________
Title: Vice President-Finance
and Chief Financial Officer
5
CONFORMED COPY
EMPLOYMENT AGREEMENT
____________________
AGREEMENT made as of September 10, 1990, between Infinity
Broadcasting Corporation, a Delaware corporation (the "Employer"), and
Mel Karmazin (the "Executive").
The Executive and the Employer are parties to an Employment
Agreement, made as of December 30, 1985 (the "Prior Agreement"), which
governs the terms and conditions of the Executive's employment as a
senior executive officer of the Employer through December 31, 1995.
The parties therefore agree, effective at and only upon the
Closing (as defined in the Stock Purchase Agreement, dated as of August
3, 1990, among the Employer, Michael A. Wiener ("Wiener"), Gerald Carrus
("Carrus"), the trusts listed on Schedule 3 thereto (the "Trusts"),
Shearson Lehman Hutton Capital Partners II L.P., Shearson Lehman Hutton
Merchant Banking Portfolio Partnership L.P., Shearson Lehman Hutton
Offshore Investment Partnership Japan L.P. and Shearson Lehman Hutton
Offshore Investment Partnership L.P. (the "Purchasers") and, as so
defined, used herein and also referred to as the "Effective Date"), as
follows:
I. Employment. Upon the terms and subject to the conditions
__________
of this Agreement, Employer hereby employs
<PAGE>
the Executive and the Executive hereby accepts employment by Employer
on the terms hereinafter set forth.
II. Term.
____
A. The term of the Executive's employment hereunder (the
"Term") shall commence on the Effective Date and continue until the
fifth anniversary thereof, subject to the extension provisions of
Section 2.2 (the "Termination Date") unless terminated earlier in
accordance with the provisions of Section 13.1, Section 13.2 or Section 14.1.
B. The Termination Date shall automatically be extended for
one year as of each anniversary of the Effective Date (an "Anniversary
Date") up to and including the Anniversary Date next following the
Executive's attainment of age 61, provided that the Termination Date
________
shall not be further extended if (a) within 30 days prior to an
_
Anniversary Date, the Employer, with the approval of a Majority (as defined
in Section 3.2) of the Board (as defined in Section 3.1) delivers to the
Executive, or the Executive delivers to the Employer, notice that the
extension provision of this Section 2.2 shall be inoperative, (b) a
_
notice of termination is delivered (or was previously delivered and has
not been withdrawn) pursuant to Section 13 or Section 14, (c) the
_
Executive dies, or (d) a Disability Date (as hereafter defined) occurs
_
or is continuing.
2
<PAGE>
III. Executive's Position, Duties, and Authority.
___________________________________________
A. The Employer shall employ the Executive, and the Executive
shall serve, as President and Chief Executive Officer of the Employer and
of any successor by merger, acquisition of substantially all of the assets of
the Employer or otherwise, or in such higher position or positions to
which a majority of the Board of Directors of the Employer (the
"Board"), shall with the Executive's consent (which consent will not be
unreasonably withheld and shall not be required with respect to the
positions described in Section 3.4) appoint the Executive.
B. The Executive shall have executive duties, functions,
authority and responsibilities commensurate with the office or offices
he from time to time holds with the Employer. The Executive's duties,
functions, authority and responsibilities hereunder shall be substantially
the same as or greater than the duties, functions, authority and
responsibilities held by the Executive immediately prior to the
Effective Date and shall not be substantially diminished at any time
except by action of a majority of the Board, which majority, as long as
the Stockholders' Agreement (the "Stockholders' Agreement") among the
Employer, the Executive, Wiener, Carrus, the Trusts, the Purchasers and
certain other stockholders dated as of September 10, 1990
3
<PAGE>
remains in effect, shall include at least one director designated by the
Purchasers and which majority, thereafter, shall include two-thirds of the
members of the Board (a "Majority"), in the event of which diminution the
provisions of Section 14.2 shall apply unless the Executive has consented
in writing to the diminution.
C. Following any expiration or termination of the
Stockholders' Agreement, the Employer shall use its best efforts to
cause the Executive to be a member of the Board throughout the term of
the Executive's employment hereunder, and shall include him in the
management slate for election as a director at every stockholders'
meeting at which his term as a director would otherwise expire.
D. The Executive shall serve without additional remuneration
as a director and/or officer of one or more of the Employer's
subsidiaries if appointed to such position by the Employer.
IV. Full-time Services. The Executive's services
__________________
hereunder shall be performed on a substantially full-time basis in a
diligent and competent fashion to the best of his abilities. The
Executive shall not undertake outside employment, business or charitable
activities that require the devotion of substantial amounts of the
Executive's time without the consent of a Majority of the Board. Except as
4
<PAGE>
provided in Section 17, the Executive may serve on boards of
directors of other organizations and companies; provided that the
________
service on such other boards of directors does not interfere with the
performance of the Executive's services hereunder.
V. Location of Employment. Unless the Executive
______________________
consents otherwise in writing, the headquarters for performance of his
services hereunder shall be the principal offices of the Employer in New
York, New York, and the Executive shall not be required to relocate his
office more than 25 miles from the City of New York, subject to such
reasonable travel as the performance of the Executive's duties in the
business of the Employer may require.
VI. Base Salary. During the Term, the Employer
___________
shall pay or cause to be paid to the Executive an initial base salary
per annum of $750,000 (the "Base Salary"), payable in monthly
installments. The Employer shall review the Executive's Base Salary at
least annually and may by action of a Majority of the Board increase,
but shall not decrease, such Base Salary, as such salary may have been
increased, at any time and from time to time during the Term.
5
<PAGE>
VII. Incentive Compensation.
______________________
A. Cash Incentive Compensation.
___________________________
The Executive shall be entitled to
receive cash incentive compensation determined and payable as set forth
in Exhibit A hereto.
B. Equity-Based Incentive Compensation.
___________________________________
The Executive shall be entitled to
receive incentive compensation in the form of stock options and deferred
stock, determined and payable as set forth in Exhibit B hereto.
VIII. Expenses. The Employer shall pay or reim-
________
burse the Executive for all reasonable expenses actually incurred or
paid by the Executive during the term of employment in the performance
of the Executive's services hereunder upon presentation of expense
statements or vouchers or such other supporting information as the
Employer may reasonably require of the Executive.
IX. Vacation and Other Benefits. The Executive
___________________________
shall be entitled to 25 business days of paid vacation per year
(accruing at the rate of 2-1/12 days per month for purposes of calculating
payments on termination of employment). During the Term, the Executive shall
be eligible to participate in any pension or profit-sharing plan or
program of the Employer now existing or established hereafter, in
6
<PAGE>
accordance with and to the extent that he is eligible
under the general provisions thereof. The Executive shall also be
eligible to participate in any group life insurance, hospitalization,
medical, health and accident, disability or similar plan or program of
the Employer, now existing or established hereafter, in accordance with
and to the extent that he is eligible under the general provisions
thereof.
X. Existing Life Insurance. The Employer has
_______________________
obtained $1,000,000 of life insurance on the life of the Executive. The
Employer shall continue to pay all premiums on such policies and shall
maintain them (without modification of any of the terms thereof and
without reduction of the amount of the full coverage available to the
Executive), subject to the insurability of the Executive, if required to
keep such policies in effect during the Term.
XI. Indemnification. The Executive shall be
_______________
entitled in connection with his employment hereunder to the benefit of
the indemnification provisions contained on the date hereof in the
bylaws and certificate of incorporation of the Employer, and the
provisions of the Indemnity Agreement, dated as of February 27, 1986,
between the Employer and the Executive, in either case as the same may
hereafter be amended (not including any amendments or
7
<PAGE>
additions that limit or narrow, but including any that add to or broaden, the
protection afforded to the Executive), to the fullest extent permitted
by applicable law. The Employer shall in addition cause the Executive
to be indemnified in accordance with Section 145 of the Delaware General
Corporation Law to the fullest extent permitted by such section, to the
extent required to make the Executive whole in connection with any loss,
cost or expense indemnifiable thereunder.
XII. Confidential Information.
________________________
A. The Executive acknowledges that his employment
by the Employer has brought and will bring him into close contact with
confidential proprietary information of the Employer, including information
regarding costs, profits, markets, sales, products, key personnel,
pricing policies, operational methods, technical processes,
other business affairs and methods, plans for future developments, and
other information not readily available to the public, the disclosure of
which to third parties would in each case have a material adverse effect
on the Employer's business operations (the "Confidential Information").
In recognition of the foregoing, the Executive covenants and agrees:
B. That he will keep secret all Confidential
Information and will not intentionally disclose Confidential
8
<PAGE>
Information to anyone outside of the Employer other than in the course of
performance of his duties hereunder, either during or after the Term
except with the Employer's written consent, provided that (i) the Executive
________ _
shall have no such obligation to the extent Confidential Information is
or becomes publicly known other than as a result of theExecutive's
breach of his obligations hereunder and (ii) the Executive
__
may, after giving prior notice to the Employer to the extent practicable
under the circumstances, disclose such matters to the extent required by
applicable laws or governmental regulations or judicial or regulatory
process; and
C. That he will deliver promptly to the Employer on
termination of his employment by the Employer or at any other time the
Employer may so request, and at the Employer's expense, all memoranda,
notes, records, reports and other documents (and all copies thereof)
relating to the Employer's business, which he obtained while employed
by, or otherwise serving or acting on behalf of, the Employer and which
he may then possess or have under his control (the "Records"). In the
event the Executive fails to promptly deliver all Records following a
termination of the Executive's employment or at such other time as the
Employer may request, the Employer shall be entitled to injunctive
9
<PAGE>
relief enforcing this Section 12.3 to the extent reasonably necessary to
protect the Employer's legitimate interests.
XIII. Termination of Agreement by the Employer.
________________________________________
A. Without Cause. The Employer may, by action of a
_____________
Majority of the Board, terminate without Cause the Executive's
employment under this Agreement at any time. Such termination shall be
effective immediately upon delivery of notice of such termination to
Executive. In the event of termination by the Employer without Cause,
the following provisions shall apply:
13.1.1 Effective as of the date a notice is
delivered pursuant to Section 13.1, the Executive shall have no further
obligations or liability hereunder (except the Executive's obligations
under Section 12 and Section 17, which shall survive);
13.1.2 Effective as of the date a notice is
delivered pursuant to Section 13.1, the Employer shall have no further
obligations or liability hereunder except that the Employer's obligations
to make the payments as provided in Sections 13.1.3 and 13.1.4,
which shall survive;
13.1.3. The incentive compensation payable
hereunder in respect of the period from the date on which the Employer's
notice is delivered through the Termination Date shall be calculated
based on the greater of (a) actual
-
10
<PAGE>
earnings before interest, taxes, amortization and depreciation as
such term is used in Exhibit A hereto ("EBITAD") and (b) EBITAD in
-
the last fiscal year of the Employer preceding the date on which
notice of such termination was delivered. The Employer shall pay to
the Executive an amount equal to the present value of all the remaining
Base Salary payable hereunder. The present value calculation made
pursuant to the foregoing sentence shall assume annual compound interest
at the prime rate (as published in the Wall Street Journal) for the first
___________________
business day of the month in which the notice of termination is
delivered pursuant to Section 13.1; and
13.1.4 In the event of the Executive's death
following the delivery of a notice of termination pursuant to Section
13.1, any and all amounts remaining payable hereunder shall be paid to
the Executive's estate or designated beneficiary, and, with respect to
remaining Base Salary, shall be paid in a single sum in the manner set
forth in Section 13.1.3.
B. For Cause. The Employer may terminate the
_________
Executive's employment hereunder for Cause. Termination for Cause by
the Employer shall mean termination by action of a Majority of the
Board, following a minimum of ten business days' prior notice (the
"Preliminary Notice") to the
11
<PAGE>
Executive specifying the proposed grounds therefor and an opportunity for the
Executive or the Executive's designated representative to present to the Board
arguments and evidence in opposition thereto, because of (a) action by the
-
Executive involving willful malfeasance or gross misconduct in connection with
his employment hereunder having a material adverse effect on the business of
the Employer, (b) substantial and continuing refusal by Executive in
_
breach of this Agreement to perform the duties ordinarily performed by a
chief executive officer or other duties assigned to the Executive
pursuant to the terms hereof, or (c) the Executive's conviction of a
_
felony under (i) the laws of the United States or any state thereof or
_
(ii) the laws of any other country or political subdivision thereof
__
involving in either case moral turpitude (as the concept is understood
under United States law). Following action by a Majority of the Board,
such termination shall be effected by notice thereof (the "Final
Notice") delivered by the Employer to the Executive and shall be
effective as of the date of delivery of such Final Notice.
Notwithstanding any provisions of Section 14, any termination by the
Executive on or after the date of the Preliminary Notice which would
otherwise have been subject to the provisions of Section 14 shall be
deemed a termination for Cause subject to the
12
<PAGE>
provisions of this Section 13 if a Final Notice is thereafter delivered
in connection with such Preliminary Notice.
In the event of termination by the Employer for
Cause in accordance with the foregoing procedures, the following
provisions shall apply:
13.2.1 The Employer shall have no further
obligation to pay Base Salary to the Executive except for Base Salary
accrued through the date of the Preliminary Notice;
13.2.2 The Company shall have no further
obligation to pay incentive compensation to the Executive except for
incentive compensation in respect of periods preceding the year in which
such termination is effective (to the extent not previously paid);
13.2.3 The Executive shall have no further
obligations or liability to the Employer (except his obligations under
Section 12 and Section 17, which shall survive).
XIV. Termination by the Executive.
____________________________
A. Voluntarily.
___________
14.1.1 The Executive may terminate his employment
hereunder voluntarily upon 30 business days' prior notice to the Board.
Such termination shall be
13
<PAGE>
effective as of the date specified in such notice (which shall be 30 business
days after the delivery of such notice).
14.1.2 In the event of the termination of the
Executive's employment pursuant to this Section 14.1, the Employer shall
pay to the Executive any unpaid Base Salary in respect of the period
through the effective date of the termination and any unpaid incentive
compensation in respect of years preceding the year in which such
termination becomes effective, but shall have no further obligation or
liability to pay salary or incentive compensation to the Executive
hereunder. The Executive's obligations and liabilities to the Employer
hereunder shall cease as of the effective date of termination (except
his obligations under Section 12 and Section 17, which shall survive).
B. For Good Reason. The Executive shall have the
_______________
right, exercisable by written notice to the Employer, to terminate his
employment hereunder effective upon 30 business days' prior notice to
the Board for Good Reason. For purposes of this Agreement, Good Reason
shall mean (a) the Employer's material breach of its obligations
_
hereunder, or (b) the assignment to the Executive by a Majority of the Board
_
of duties, functions, responsibilities or authority substantially
inferior to the duties, functions,
14
<PAGE>
responsibilities and authority contemplated by Section 3. A termination for
Good Reason shall not be effective if within the thirty-business-day period
after the Executive's delivery of a notice pursuant to this Section 14.2 based
on a reason described in clause (a) or clause (b) of this Section 14.2 the
_ _
Employer shall have cured such material breach or diminution of duties,
functions, responsibility or authority, and Good Reason shall not be deemed
to exist in respect of such conditions and the Executive's notice
hereunder shall be void.
In the event of termination by the Executive for
Good Reason in accordance with the foregoing procedures, the following
provisions shall apply:
14.2.1 Effective as of the thirtieth business
day following delivery of the Executive's notice pursuant to Section
14.2, the Executive shall have no further obligations or liabilities to
the Company hereunder (except for his obligations under Section 12 and
Section 17, which shall survive);
14.2.2 Effective as of the date a notice is
delivered pursuant to Section 13.1, the Employer shall have no further
obligations or liability hereunder except that the Employer's
obligations to make payments as provided in Sections 14.2.3 and 14.2.4,
which shall survive;
15
<PAGE>
14.2.3 The incentive compensation payable
hereunder in respect of the period from the date on which the
Executive's notice under Section 14.2 is delivered through the
Termination Date shall be calculated based on the greater of (a) actual
_
EBITAD and (b) the EBITAD of the Employer for the year immediately
_
preceding the year in which the Executive's notice is delivered. The
Employer shall pay to the Executive an amount equal to the present value
of all of the remaining Base Salary payable hereunder. The present
value calculation made pursuant to the foregoing sentence shall assume
interest at the prime rate (as published in the Wall Street Journal) for
___________________
the first business day of the month in which the Executive's notice is
delivered pursuant to Section 14.2; and
14.2.4 In the event the Executive dies
following the delivery of a notice of termination pursuant to Section
14.2, any and all amounts remaining payable hereunder shall be paid to
the Executive's estate or designated beneficiary, and, with respect to
Base Salary, shall be paid in a single sum in the manner set forth in
Section 14.2.3.
XV. Disability.
__________
A. If during his active employment hereunder the
Executive shall become physically or mentally disabled,
16
<PAGE>
whether totally or partially, so that he is prevented from performing his
usual duties for a period of six consecutive months, the Employer shall,
nevertheless, pay the Executive his full Base Salary and prorated incentive
compensation in respect of the period ending on the last day of the
sixth consecutive month of disability (such last day being referred to
herein as the "Disability Date") and the following additional provisions
shall apply:
B. If the Executive has not resumed his usual
duties on or prior to the Disability Date, the Executive's employment
shall terminate and the Employer shall pay, unless prior to the date the
Executive became physically or mentally disabled a notice of termination
was delivered pursuant either to Section 13 or Section 14, to the
Executive 75% of his Base Salary from the Disability Date through the
Termination Date and, except as provided in Section 15.4, the Employer
shall have no obligation to pay incentive compensation to the Executive
in respect of periods after the Disability Date. Any Base Salary
payable pursuant to this Section 15.2 shall be reduced by the amount of
any benefits payable to the Executive under any group or individual
disability insurance plan or policy, the premiums for which are paid
primarily by the Employer;
17
<PAGE>
C. Unless the Employer exercises its option under
Section 15.4 to restore the Executive to his full compensation, duties,
functions, authority and responsibilities hereunder, the Employee shall
have no obligations or liabilities hereunder from and after the
Disability Date (except for his obligations under Sections 12, which
shall survive); and
D. If during the Term and subsequent to a
Disability Date, the Executive shall recover fully from a disability,
the Employer, by action of a Majority of the Board, shall have the right
(exercisable within sixty days after notice from the Executive of such
recovery), but not the obligation, to restore the Executive to
employment and to full compensation and his full level of duties,
functions, authority and responsibilities hereunder.
XVI. Death of Executive.
__________________
A. Upon the Executive's death whether prior to or
subsequent to his Disability Date and prior to the delivery of a notice
of termination pursuant to Section 13 or Section 14, this agreement and
all of the Employer's obligations to pay salary and incentive
compensation hereunder shall terminate, except as provided in Sections
16.2 through 16.4.
B. The Executive's estate or designated beneficiary
shall be entitled to receive (a) any unpaid portions of the
_
18
<PAGE>
Executive's Base Salary in respect of the period ending on the Executive's
date of death, (b) unpaid incentive compensation in respect of years prior to
_
the year of death and incentive compensation for the year of death
prorated through the Executive's date of death and, (c) Base Salary for
_
the period from the Executive's date of death through the earlier of the
one-year anniversary of such date of death and the Termination Date.
The Employer shall pay to such estate or beneficiary an amount equal to
the present value of all the remaining Base Salary payable under this
Section 16.2, calculated assuming annual compound interest at the prime
rate (as published in the Wall Street Journal) for the first business
___________________
day of the month in which the Executive's death occurs.
C. The Base Salary and incentive compensation
payable pursuant to this Section 16 shall be reduced by the value of any
benefits payable to the Executive's estate or designated beneficiary
under any life insurance plan or policy the premiums for which are paid
primarily by the Employer, other than such insurance identified in
Section 10.
XVII. Non-competition.
_______________
A. During the Executive's active employment
hereunder and for a period of twenty-four months following
19
<PAGE>
the delivery of a notice of termination pursuant to Section 13.1, Section 14.1
or Section 14.2 hereof, the Executive will not, without the prior written
approval of a Majority of the Board, engage directly or indirectly in,
or become employed by, serve as an agent or consultant to or become an
officer, director, partner, principal or stockholder of any partnership,
corporation or other entity which is engaged in a business which is
directly competitive in any city with any business in which the Employer
is engaged at the time such relationship is entered into (a
"Competitor"). As long as the Executive does not engage in any other
activity prohibited by the immediately preceding sentence, the
Executive's ownership of less than 2% of the issued and outstanding
stock of any corporation whose stock is traded on an established securities
market shall not constitute competition with the Employer for the
purpose of this section 17.
B. If the Executive competes with the Employer in
violation of Section 17.1 following the delivery of a notice of
termination pursuant to Section 13.1 or Section 14.2, (a) first, to the
_ _____
extent that Base Salary and incentive compensation remains to be paid to
the Executive, the total Base Salary and incentive compensation payable
to the Executive pursuant to such sections shall be reduced by the
20
<PAGE>
total amount of compensation received by the Executive by reason of such
competitive activity with respect to the twenty-four month period
following the delivery of the applicable notice of termination, (b)
_
second, to the extent that the reductions in clause (a) were less than
______ _
the amount of compensation received by the Executive by reason of such
competitive activity with respect to the twenty-four month period
following the delivery of the applicable notice of termination and to
the extent compensation has been paid to the Executive pursuant to
Section 13.1 or Section 14.2 without reduction pursuant to this Section
17.2, the Executive shall repay to the Employer an amount equal to the
lesser of (i) the total amount of compensation received by the Executive
_
by reason of such competitive activity with respect to such twenty-four
month period less the amount of reductions pursuant to clause (a), and
_
(ii) the total amount of compensation received by the Executive
__
hereunder with respect to such twenty-four month period. In no event
shall the Employer be entitled to any relief in respect of the
Executive's violation of Section 17.1 following the delivery of a notice
of termination pursuant to Section 13.1 or 14.2 other than as set forth
in this Section 17.2.
C. In the event the Executive competes with the
Employer in violation of Section 17.1 following a
21
<PAGE>
termination of the Executive's employment pursuant to Section 14.1, the
Employer shall be entitled to injunctive relief enforcing Section 17.1 to the
extent reasonably necessary to protect the Employer's legitimate interests.
XVIII. Change in Control. The Executive may ter-
_________________
minate his employment hereunder upon ten days' written notice following
the occurrence of a Change in Control, if the Stockholders' Agreement
shall have terminated on or before the date on which such Change in
Control occurs. Upon such termination of employment, the Employer shall
pay to the Executive Base Salary accrued, and incentive compensation
prorated, through the effective date of such termination, and any unpaid
Base Salary and incentive compensation in respect of prior periods, and
neither the Employer nor the Executive shall have any obligation or
liability hereunder to the other (except for the Executive's obligations
under Section 12, which shall survive). For purposes of this Section
18, "Change in Control" shall mean the acquisition by any person or
group of affiliated persons (other than the Purchasers and their
Permitted Transferees (as defined in the Stockholders' Agreement)) of
the ability, by contract or otherwise, to elect a majority of the
members of the Board or the power, by contract or otherwise, to vote 50%
or more of the stock of the Employer.
22
<PAGE>
XIX. Prior Employment Agreement. The prior
__________________________
employment agreement between the Company and the Executive, dated as of
December 30, 1985, shall terminate on the Effective Date, except with
respect to the Company's obligation to pay the Executive his salary and
reimburse Executive for expenses for the period ending on the Effective
Date of this Agreement.
XX. No Mitigation Required. The Executive shall
______________________
not be required to mitigate any damages suffered by him by reason of a
breach hereof and, except as provided in Section 17, no amounts payable
to the Executive by reason of the termination of his employment
hereunder shall be subject to reduction or offset, or otherwise
diminished, by reason of any other compensation received by the
Executive.
XXI. Notices. All notices, requests, consents and
_______
other communications, required or permitted to be given hereunder, shall
be in writing and shall be deemed to have been duly given if delivered
personally or sent by prepaid telegram, or mailed first-class, postage
prepaid, by registered or certified mail, as follows (or to such other
or additional address as either party shall designate by notice in
writing to the other in accordance herewith):
23
<PAGE>
A. If to the Employer:
Infinity Broadcasting Corporation
600 Madison Avenue
New York, New York 10022
Attention: Board of Directors
B. If to the Executive, to him at his address on
the personnel records of the Company.
C. Copies of all communications given hereunder
shall also be delivered or sent, in like fashion, to Debevoise & Plimpton
(attention: Bruce D. Haims, Esq.) at 875 Third Avenue, New York,
New York 10022 and to Simpson Thacher & Bartlett (attention: David B.
Chapnick, Esq.) at 425 Lexington Avenue, New York, New York 10017-3909.
XXII. General.
_______
A. Governing Law. This agreement shall be
_____________
governed by and construed and enforced in accordance with the internal
laws of the State of New York.
B. Captions. The section headings contained herein
________
are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.
C. Entire Agreement. Except to the extent
________________
otherwise provided in the Stock Purchase Agreement and the Stockholders'
Agreement, this agreement including the Exhibits attached hereto sets
forth the entire agreement and understanding of the parties relating to
the subject matter hereof, and supersedes all prior agreements, arrangements
24
<PAGE>
and understandings, written or oral, between the parties,
including, without limitation, the Prior Agreement, except as
specifically provided herein.
D. Successors and Assigns. This agreement, and the
______________________
Executive's rights and obligations hereunder, may not be assigned by the
Executive, except that the Executive may designate pursuant to Section
22.6 one or more beneficiaries to receive any amounts that would
otherwise be payable hereunder to the Executive's estate. This
agreement shall be binding on any successor to the Employer, whether by
merger, acquisition of substantially all of the Employer's assets or
otherwise, as fully as if such successor were a signatory hereto and the
Employer shall cause such successor to, and such successor shall, expressly
assume the Employer's obligations hereunder. The term
"Employer," as used in this agreement, shall include all such
successors.
E. Amendments; Waivers. This agreement cannot be
___________________
changed, modified or amended, and no provision or requirement hereof may
be waived, without an affirmative vote of not less than a Majority of
the Board and the consent in writing of the Executive and the Employer.
The failure of a party at any time or times to require performance of
any provision hereof shall in no manner affect the right of such party
at a later time to enforce the same. No
25
<PAGE>
waiver by a party of the breach of any term or covenant contained in this
Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any
such breach, or a waiver of the breach of any other term or covenant
contained in this Agreement.
F. Beneficiaries. Whenever this Agreement provides
_____________
for any payment to the Executive's estate, such payment may be made
instead to such beneficiary or beneficiaries as the Executive may have
designated in a writing filed with the Employer. The Executive shall
have the right to revoke any such designation and to redesignate a
beneficiary or beneficiaries by written notice to the Employer (and to
any applicable insurance company) to such effect.
XXIII. Effectiveness of Agreement. If for any
__________________________
reason the Transaction shall not occur, the provisions of this agreement
shall become null and void and be of no
26
<PAGE>
further force or effect and the Prior Agreement shall continue unaffected.
IN WITNESS WHEREOF, the parties have duly executed
this Agreement as of the date first above written.
INFINITY BROADCASTING CORPORATION
By /s/ Michael A. Wiener
______________________________
/s/ Mel Karmazin
______________________________
MEL KARMAZIN
27
<PAGE>
EXHIBIT A
_________
Cash Incentive Compensation
___________________________
For each fiscal year of the Company, commencing with
the fiscal year ending December 30, 1990, that the Company meets its
EBITAD target as mutually established by the Board and the Executive,
the Executive will be entitled to receive cash incentive compensation (a
"Bonus") as follows:
Fiscal Year Bonus
___________ _____
1990 $217,000
1991 245,000
1992 247,000
1993 269,000
1994 294,000
Thereafter As agreed between
the Executive and
the Board
If the Termination Date is other than the last day
of a fiscal year, Executive will be entitled to a pro rated Bonus for
the portion of the year preceding the Termination Date if the EBITAD
target is met through the end of the month ending on or next preceding
the Termination Date.
EBITAD means earnings before interest, taxes,
amortization and depreciation as reported in the Company's Form 10-K for
the fiscal year, or, if for a portion of the year, as approved by the
Board based on the Company's books and records.
The Bonus for any year shall be paid not later than
30 days after the filing by the Company of its Form 10-K with the
Securities and Exchange Commission ("SEC") for such year, or if the
Bonus is for a part of the year, not later than 60 days after the end of
the last month taken into account in determining whether the EBITAD
target is met.
<PAGE>
EXHIBIT B
_________
Stock Options and Deferred Stock
________________________________
Stock Options
_____________
For each year that the EBITAD target is met,
commencing with the fiscal year ending December 30, 1990, Executive
shall be granted on the thirtieth day following the filing by the
Company of its Form 10-K with the SEC for such year, an option to
acquire 50,000 shares of Class B common stock of the Company. The
exercise price for the option shall be 85% of the fair market value of a
share of Common Stock (assuming that the value of each Class A and Class
B share is the same) determined by the Board as of the last day of the
period for which the award is made. The option shall be immediately
exercisable and shall expire ten years after the date of grant.
If the Termination Date is other than the last day
of a fiscal year, the Executive shall be granted an option to acquire a
pro rated number of shares for such year if the EBITAD target for the
portion of the year through the end of the month ending on or
immediately prior to the Termination Date is met.
Deferred Share Plan
___________________
If the EBITAD Target for a fiscal year is exceeded,
the Executive shall receive a number of Class B Deferred Shares, as
defined in and pursuant to the Deferred Share Plan of the Company,
determined by (a) multiplying each Increment, as defined below, by the
applicable Applied Percentage, and (b) dividing the sum of the resulting
products by an amount equal to 85% of the fair market value of a share
of common stock (assuming that the value of each Class A and Class B
share is the same) determined by the Board as of the last day of the
period for which the award is made.
Amount by Which Actual Maximum Maximum
EBITAD Exceeds the Applied Increment Aggregate
EBITAD Target ("Increment") Percentage Cash Value Cash Value
___________________________ __________ __________ __________
0 - $1,000,000 3% $30,000 $ 30,000
$1,000,001 - 2,000,000 4% 40,000 70,000
2,000,001 - 3,000,000 5% 50,000 120,000
3,000,001 - 4,000,000 5% 50,000 170,000
4,000,001 - 5,000,000 5% 50,000 220,000
5,000,001 - or more 5%
<PAGE>
Deferred Shares for a year shall be awarded on
the thirtieth day following the filing by the Company of
its Form 10-K with the SEC for such year. All Deferred
Shares shall be fully vested at the date of grant, and shares
of Class B Common Stock shall be deliverable to
Executive as provided in the Deferred Share Plan.
2
<PAGE>
CONFORMED COPY
FIRST AMENDMENT TO
EMPLOYMENT AGREEMENT
____________________
The Employment Agreement, made as of September
10, 1990, between Infinity Broadcasting Corporation, a Delaware
corporation, and Mel Karmazin (the "Employment Agreement")
is hereby amended as follows, effective as of January 1,
1991. All capitalized terms shall have the meanings set
forth in the Employment Agreement.
1. Section 6 of the Employment Agreement is
amended by the addition of the following sentence at the end
thereof:
Notwithstanding the foregoing provisions of this
Section 6, the Employer at its sole option may pay
any Base Salary in respect of calendar year 1991
in the form of common stock of the Employer or
warrants to purchase common stock of the Employer,
such stock or warrants to have an equivalent value
to such Base Salary. The Employer may exercise
its option to make payment in the form of stock or
warrants only by action of a Majority of the Board
(excluding the Executive for purposes of calculat-
ing such Majority).
IN WITNESS WHEREOF, the parties hereto have caused
this First Amendment to be duly executed this 30th day of
September 1991.
INFINITY BROADCASTING CORPORATION
By /s/ Gerald Carrus
________________________________
Co-Chairman and Treasurer
/s/ Mel Karmazin
________________________________
MEL KARMAZIN
1
<PAGE>
CONFORMED COPY
SECOND AMENDMENT TO
EMPLOYMENT AGREEMENT
____________________
The Employment Agreement between Infinity Broad-
casting Corporation, a Delaware corporation (the "Company"),
and Mel Karmazin, made as of September 10, 1990 and amended
as of September 30, 1991 (the "Employment Agreement") is
hereby further amended as follows, effective as of February
4, 1992. All capitalized terms shall have the meanings set
forth in the Employment Agreement.
2. Sections 3.2 and 3.3 of the Employment Agree-
ment are amended to read in their entirety as follows:
"3.2 The Executive shall have executive
duties, functions, authority and responsibilities
commensurate with the office or offices he from
time to time holds with the Employer. The
Executive's duties, functions, authority and
responsibilities hereunder shall be substantially
the same as or greater than the duties, functions,
authority and responsibilities held by the
Executive immediately prior to the Effective Date
and shall not be substantially diminished at any
time except by action of a majority of the Board,
which majority shall include two-thirds of the
members of the Board (a "Majority"). In the event
of such a diminution, the provisions of
Section 14.2 shall apply unless the Executive has
consented in writing to the diminution.
"3.3 The Employer shall use its best efforts to
cause the Executive to be a member of the Board throughout the
term of the Executive's employment hereunder, and shall
include him in the management slate for election as a director
at every stockholders' meeting at which his term as a director
would otherwise expire."
1
<PAGE>
3. Section 7 of the Employment Agreement is amended by adding
thereto a new Section 7.3, reading as follows:
"7.3 Failure to Make Award. If the Employer's stock
_____________________
option plan and deferred share plan are, at the time an award of
equity-based incentive compensation is payable under Exhibit B,
administered by a committee of "disinterested" directors (within
the meaning of Rule 16b-3 under the Securities Exchange Act of
1934, as amended) with respect to awards to the Executive, the
Employer shall recommend that such committee grant such award to
the Executive. If the committee fails to grant the award on or
before the thirtieth day following the filing by the Employer of
its Form 10-K with the Securities and Exchange Commission for the
applicable year, the Employer shall pay to the Executive in cash an
amount equal to the sum of (a) 25% of the fair market value of the
_
number of shares of Class B common stock as to which Exhibit B
requires the award of options and (b) 125% of the fair market value
_
of the number of shares of Class B common stock as to which Exhibit
B requires the award of deferred shares for the applicable fiscal
year of the Employer.
"For purposes of this Section 7.3, fair market value
shall be determined as of the last day of the period for which the
equity-based incentive compensation award is payable, by an
independent appraiser selected by the Executive and reasonably
acceptable to the Employer. The expenses of the appraisal shall be
paid by the Employer, and any cash amount payable under required
this Section 7.3 shall be paid to the Executive within ten days
after the appraiser renders its fair market value determination."
4. Section 18 of the Employment Agreement is amended so that
the final sentence thereof reads as follows:
"For purposes of this Section 18, `Change in Control' shall
mean the acquisition by any person or group of affiliated
persons (other than the Purchasers and their Permitted
Transferees (as defined in the Stockholders' Agreement among the
2
<PAGE>
Executive, Wiener, Carrus, the Trusts, the Purchasers and
certain other stockholders, as in effect on September 10,
1990)) of the ability, by contract or otherwise, to elect a
majority of the members of the Board or the power, by contract
or otherwise, to vote 50% or more of the stock of the
Employer."
IN WITNESS WHEREOF, the parties hereto have caused this Second
Amendment to be duly executed this 4th day of February, 1992.
INFINITY BROADCASTING CORPORATION
By: /s/ Michael A. Wiener
______________________________
Michael A. Wiener
Chairman of the Board
and Secretary
/s/ Mel Karmazin
______________________________
MEL KARMAZIN
3
<PAGE>
CONFORMED COPY
THIRD AMENDMENT TO
EMPLOYMENT AGREEMENT
____________________
The Employment Agreement between Infinity Broadcasting
Corporation, a Delaware corporation (the "Company"), and Mel Karmazin,
made as of September 10, 1990 and amended as of September 30, 1991 and
February 4, 1992 (the "Employment Agreement") is hereby further amended
as follows, effective as of June 14, 1993. All capitalized terms shall
have the meanings set forth in the Employment Agreement.
1. The first paragraph of Exhibit B to the Employment
Agreement is amended to read in its entirety as follows:
For each year that the EBITAD target is met, commencing
with the fiscal year ending December 30, 1990, Executive shall
be granted, on the thirtieth day following the filing by the
Company of its Form 10-K with the SEC for such year, an option
to acquire 50,000 shares of the Class B common stock of the
Company. Notwithstanding the foregoing sentence, such option
may permit the acquisition of shares of Class A common stock
of the Company to the extent options for the purchase of Class
B shares are not available for issuance under the Company's
Key Employee Stock Option Plan (or a successor plan thereto)
at the time the option is awarded. The per share exercise
price of the option shall be 85% of the fair market value of a
share of Common Stock (assuming that the value of each Class A
and Class B share is the same) determined by the Board as of
the last day of the period for which the award is made. The
option shall be immediately exercisable and shall expire ten
years after the date of grant.
1
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Third
Amendment to be duly executed this 30th day of June, 1993.
INFINITY BROADCASTING CORPORATION
By: /s/ Farid Suleman
_______________________________
Vice President-Finance
and Chief Financial Officer
/s/ Mel Karmazin
_______________________________
MEL KARMAZIN
2
<PAGE>
CONFORMED COPY
FOURTH AMENDMENT TO
EMPLOYMENT AGREEMENT
____________________
The Employment Agreement between Infinity Broadcasting
Corporation, a Delaware corporation (the "Company"), and Mel Karmazin,
made as of September 10, 1990 and amended as of September 30, 1991,
February 4, 1992 and June 30, 1993 (the "Employment Agreement"), is
hereby further amended as follows, effective as of the payment date for
the Company's three-for-two split of its common stock in the form of a
50% stock dividend.
1. The first paragraph of Exhibit B to the Employment
Agreement is amended by changing the term "50,000" therein to the term
"75,000."
IN WITNESS WHEREOF, the parties hereto have caused this Fourth
Amendment to be duly executed this 3rd day of August, 1993.
INFINITY BROADCASTING CORPORATION
By: /s/ Michael A. Wiener
_______________________________
Chairman of the Board
and Secretary
/s/ Mel Karmazin
________________________________
MEL KARMAZIN
1
<PAGE>
CONFORMED COPY
FIFTH AMENDMENT TO
EMPLOYMENT AGREEMENT
____________________
The Employment Agreement between Infinity Broadcasting
Corporation, a Delaware corporation (the "Company"), and Mel Karmazin,
made as of September 10, 1990 and amended as of September 30, 1991,
February 4, 1992, June 30, 1993 and August 16, 1993 (the date on which
the three-for-two stock split in the form of a 50% stock dividend
declared by the Board of Directors of the Company on July 26, 1993 was
distributed to stockholders) (the "Employment Agreement"), is hereby
further amended as follows, effective as of November 19, 1993 or such
other date on which the three-for-two stock split in the form of a 50%
stock dividend declared by the Board of Directors of the Company on
October 27, 1993 is distributed to stockholders (the "Effective Date").
1. The first paragraph of Exhibit B to the Employment
Agreement is amended by changing the term "75,000" therein to the term
"112,500".
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Fifth
Amendment to be duly executed as of the Effective Date.
INFINITY BROADCASTING CORPORATION
By: /s/ Michael A. Wiener
_______________________________
Chairman of the Board
and Secretary
/s/ Mel Karmazin
________________________________
MEL KARMAZIN
2
<PAGE>
CONFORMED COPY
SIXTH AMENDMENT TO
EMPLOYMENT AGREEMENT
____________________
The Employment Agreement between Infinity Broadcasting
Corporation, a Delaware corporation, and Mel Karmazin, made as of
September 10, 1990 and amended as of September 30, 1991, February 4,
1992, June 30, 1993, August 16, 1993 and November 19, 1993 (the
"Employment Agreement"), is hereby further amended as follows effective,
unless otherwise indicated, as of the date on which the material terms
(as defined in Section 162(m) of the Internal Revenue Code of 1986, as
amended, and regulations promulgated thereunder ("Section 162(m)")) of
the incentive compensation provisions herein set forth are approved by
the Company's stockholders in accordance with Section 162(m):
1. Section 7.3 of the Employment Agreement is amended to read
as set forth below:
"7.3 Failure to Make Award. If the Employer's stock
_____________________
option plan and deferred share plan are, at the time an award of
equity-based incentive compensation is payable under Exhibit B,
administered by a committee of "disinterested" directors (within
the meaning of Rule 16b-3 under the Securities Exchange Act of
1934, as amended) with respect to awards to the Executive, the
Employer shall recommend that such committee grant such award to
the Executive. If the committee fails to grant the award on or
before the thirtieth day following the filing by the Employer of
its Form 10-K with the Securities and Exchange Commission for the
applicable year, the Employer shall pay to the Executive in cash an
amount equal to the sum of (a) 25% of the fair market value of the
_
number of shares of
1
<PAGE>
Class B common stock as to which Exhibit B requires the
award of options and (b) 125% of the fair market value
_
of the number of shares of Class B common stock as to which Exhibit
B requires the award of deferred shares for the applicable fiscal
year of the Employer.
"For purposes of this agreement, the fair market value of
a share of the Company's Class A or Class B common stock shall be
the closing price (as reported on the NASDAQ National Market
System) of a share of the Company's Class A Common Stock on the
date as of which the relevant determination is made or, if no price
is so reported, the value of a share of the Company's Class A
common stock on such date as determined in good faith by the
Compensation Committee of the Board."
2. The Employment Agreement is amended, effective March 30,
1994, by the addition thereto of a new Section 7.4, reading in its
entirety as follows:
"7.4 Stockholder Approval. If stockholder approval
____________________
required by Section 162(m) of the Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder (`Section
162(m)') to qualify any portion of the compensation provided for by
Section 7.3 or Exhibit A or Exhibit B hereto for a fiscal year of
the Employer beginning on or after January 1, 1994 as `performance-
related' within the meaning of Section 162(m) is not obtained, the
Executive shall have no right hereunder to receive such portion of
such compensation. In such event the parties shall use their best
efforts to formulate, and shall seek stockholder approval of,
appropriate incentive compensation arrangements that are
`performance-related' within the meaning of Section 162(m)."
3. Section 13.1.3 of the Employment Agreement is amended so
that the term "EBITAD" appearing therein reads "EBITDA."
4. Exhibits A and B to the Employment Agreement are amended
to read in their entirety as set forth in Schedule I hereto.
2
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Sixth
Amendment to be duly executed as of the 30th day of March, 1994.
INFINITY BROADCASTING CORPORATION
By: /s/ Farid Suleman
_________________________________
Vice President-Finance
and Chief Financial Officer
/s/ Mel Karmazin
__________________________________
MEL KARMAZIN
3
SCHEDULE I
to Sixth
Amendment
__________
EXHIBIT A
_________
Cash Incentive Compensation
___________________________
For each fiscal year of the Employer, commencing with the
fiscal year ending December 31, 1994, for which the Employer meets its
EBITDA Target as established by the Compensation Committee of the Board
(the "Compensation Committee"), the Executive shall be entitled to
receive cash incentive compensation (a "Bonus") of $500,000.
If the Termination Date is other than the last day of a fiscal
year, the Executive will be entitled to a prorated Bonus for the portion
of the year preceding the Termination Date if the EBITDA Target is met
through the end of the month ending on or next preceding the Termination
Date.
EBITDA means earnings before interest, taxes, depreciation and
amortization as reported in the Employer's Form 10-K for the fiscal
year, or, if for a portion of the year, as approved by the Board based
on the Employer's books and records.
The Bonus for any year shall be paid not later than the
thirtieth day following the filing by the Employer of its Form 10-K with
the Securities and Exchange Commission ("SEC") for such year, or if the
Bonus is for a part of the year, not later than the sixtieth day
following the end of the last month taken into account in determining
whether the EBITDA Target is met.
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<PAGE>
EXHIBIT B
_________
Stock Options and Deferred Shares
_________________________________
Stock Options
_____________
For each year that the EBITDA target is met, commencing with
the fiscal year ending December 31, 1994, the Executive shall be
granted, no later than the thirtieth day following the filing by the
Employer of its Form 10-K with the SEC for such year, an option to
acquire 112,500 shares of the Class B common stock of the Employer.
Notwithstanding the foregoing sentence, such option may permit the
acquisition of shares of Class A Common Stock of the Employer to the
extent options for the purchase of Class B shares are not available for
issuance under the Employer's Stock Option Plan (or a successor plan
thereto) at the time the option is awarded. The per share exercise
price of the option shall be 85% of the fair market value of a share of
Common Stock (determined in accordance with Section 7.3 of this Agreement)
as of the last day of the period for which the award is made. The
option shall be immediately exercisable and shall expire ten years after
the date of grant.
If the Termination Date is other than the last day of a fiscal
year, the Executive shall be granted an option to acquire a prorated
number of shares for such year if the EBITDA target for the portion of
the year through the end of the month ending on or immediately prior to
the Termination Date is met.
Deferred Shares
_______________
If the EBITDA Target for a fiscal year is exceeded, the
Executive shall receive a number of Class B Deferred Shares, as defined
in and pursuant to the Deferred Share Plan of the Employer, determined
by (a) multiplying each Increment, as defined below, by the applicable
Applied Percentage, and (b) dividing the sum of the resulting products
by an amount equal to 85% of the fair market value of a share of common
stock (determined in accordance with Section 7.3 of this Agreement) as
of the last day of the period for which the award is made.
1
<PAGE>
Amount by Which Actual Maximum Maximum
EBITDA Exceeds the Applied Increment Aggregate
EBITDA Target ("Increment") Percentage Cash Value Cash Value
___________________________ __________ __________ __________
0 - $1,000,000 3% $30,000 $ 30,000
$1,000,001 - 2,000,000 4% 40,000 70,000
2,000,001 - 3,000,000 5% 50,000 120,000
3,000,001 - 4,000,000 5% 50,000 170,000
4,000,001 - 5,000,000 5% 50,000 220,000
5,000,001 - or more 5%
Deferred Shares for a fiscal year of the
Employer shall be awarded no later than the thirtieth day
following the filing by the Employer of its Form 10-K with
the SEC for such year. All Deferred Shares awarded to the
Executive pursuant hereto shall be fully vested at the
date of grant, and shares of Class B Common Stock shall be
deliverable to Executive as provided in the Deferred Share
Plan, provided that Class A Deferred Shares may be awarded
________
and delivered to the Executive in accordance with the
Deferred Share Plan (or a successor plan thereto) to the
extent Class B Deferred Shares are not available for award
under such plan at the time the Deferred Share award is
made.
2
<PAGE>
Infinity Broadcasting Corporation Proxy Form
Proxy Solicited on Behalf of the Board of Directors for the
Annual Meeting of Stockholders
June 13, 1994
The undersigned hereby appoint(s) Michael A. Wiener and Gerald Carrus,
or either of them, each with full power of substitution, as proxies to
vote all stock in Infinity Broadcasting Corporation that the
undersigned would be entitled to vote on all matters that may come
before the 1994 Annual Meeting of Stockholders and any adjournments
thereof.
Returned proxy forms will be voted: (1) as specified on the matters
listed on the reverse side of this form; (2) in accordance with the
Directors'recommendations where a choice is not specified; and (3) in
accordance with the judgment of the proxies on any other matters that
properly come before the meeting.
Your shares will not be voted unless your signed Proxy Form is returned
or you otherwise vote at the meeting.
SIGNATURE(S) _______________________________ Dated: ____________, 1994.
Please sign as registered and return promptly in the enclosed envelope.
Executors, trustees and others signing in a representative capacity
should include their names and the capacity in which they sign.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. / /
The Board of Directors recommends a vote FOR the proposals relating to:
A. Election of Directors (to withhold vote for any nominee, write
his name on the line provided) VOTE
FOR WITHHELD
Nominees for election by holders of all classes of stock
(Michael A. Wiener, Gerald Carrus, Mel Karmazin, / / / /
Farid Suleman and Steven A. Lerman)
_________________________________________________
Nominees for election by holders of Class A Shares only
(Alan R. Batkin and O.J. Simpson) / / / /
_________________________________________________
Nominees for election by holders of Class C Shares only
(James A. Stern and James L. Singleton) / / / /
_________________________________________________
FOR AGAINST ABSTAIN
B. KPMG Peat Marwick as Independent Auditors / / / / / /
C. Approval of the amendments to the Infinity / / / / / /
Broadcasting Corporation Stock Option Plan
D. Approval of the Infinity Broadcasting / / / / / /
Corporation Cash Bonus Compensation Plan
E. Approval of the incentive compensation / / / / / /
provisions of the amended employment
agreement between the Company and Mel Karmazin
Please complete, sign and date the other side and return promptly.
</page>
