<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
(Fee Required)
For the fiscal year ended December 31, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
(No Fee Required)
For the transition period from ______________ to _____________
Commission file number: 33-92732
COMMODORE MEDIA, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 13-3034720
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
500 FIFTH AVENUE
SUITE 3000
NEW YORK, NEW YORK 10110
(Address of principal executive offices) (Zip Code)
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See Table of Additional Registrants
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Registrant's telephone number, including area code: (212) 302-2727
Securities registered pursuant to Section 12(b) of the Act:
NONE
(Title of Class)
Securities registered pursuant to Section 12(g) of the Act:
NONE
(Title of Class)
Indicate by check mark whether the registrant : (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
AT MARCH 15, 1997, THERE WERE 249,847,909 SHARES OF COMMON STOCK, PAR
VALUE $.01 PER SHARE ("COMMON STOCK"), OF THE REGISTRANT OUTSTANDING. AS OF
SUCH DATE, THERE WAS NO PUBLIC MARKET FOR THE REGISTRANT'S COMMON STOCK.
DOCUMENTS INCORPORATED BY REFERENCE
NO DOCUMENTS ARE INCORPORATED BY REFERENCE INTO PARTS I, II OR III
<PAGE> 2
TABLE OF ADDITIONAL REGISTRANTS
<TABLE>
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PRIMARY STANDARD
STATE OR OTHER INDUSTRIAL I.R.S. EMPLOYER
JURISDICTION OF CLASSIFICATION IDENTIFICATION
NAME INCORPORATION NUMBER NUMBER
---------------------------------------------- ------------------ ------------------- -----------------
<S> <C> <C> <C>
Commodore Media of Delaware, Inc. Delaware 4832 51-0286804
Commodore Media of Kentucky, Inc. Delaware 4832 61-0997863
Commodore Media of Pennsylvania, Inc. Delaware 4832 23-2207457
Commodore Media of Norwalk, Inc. Delaware 4832 06-1277523
Commodore Media of Florida, Inc. Delaware 4832 59-2813110
Commodore Media of Westchester, Inc. Delaware 4832 13-3356485
Commodore Holdings, Inc. Delaware 4832 13-3858506
Danbury Broadcasting, Inc. Connecticut 4832 13-3653113
Osborn Communications Corporation Delaware 4832 06-1142367
Asheville Broadcasting Corp. Delaware 4832 56-1859801
Atlantic City Broadcasting Corp. Delaware 4832 22-3274908
Beatrice Broadcasting Corp. Delaware 4832 06-1142368
Breadbasket Broadcasting Corporation Delaware 4832 06-1443379
Corkscrew Broadcasting Corporation Delaware 4832 65-0466131
Currey Broadcasting Corporation Delaware 4832 13-3358952
Daytona Beach Broadcasting Corp. Delaware 4832 59-3223390
Great American East, Inc. North Carolina 4832 56-1580032
Houndstooth Broadcasting Corporation Delaware 4832 06-1469230
Jamboree in the Hills, Inc. Delaware 4832 55-0709712
Ladner Communications Holding Corp. Delaware 4832 13-3465060
Mountain Radio Corporation Delaware 4832 13-3401043
Music Hall Club, Inc. West Virginia 4832 55-0699199
Nelson Broadcasting Corporation Delaware 4832 13-3358975
O.C.C., Inc. Delaware 4832 13-3449243
Orange Communications, Inc. Delaware 4832 13-3387461
Osborn Entertainment Enterprises Corporation Delaware 4832 13-3465115
Osborn Sound & Communications Corp. Delaware 4832 34-1501274
RKZ Television, Inc. Delaware 4832 58-1740585
Rainbow Broadcasting Corporation Delaware 4832 63-1110166
Short Broadcasting Corporation Delaware 4832 31-1255866
SNG Holdings, Inc. Delaware 4832 13-3702089
Southeast Radio Holding Corp. Delaware 4832 06-1422492
Waite Broadcasting Corp. Delaware 4832 06-1142386
Yellow Brick Radio Corporation Delaware 4832 13-3401042
Ameron Broadcasting Corporation Delaware 4832 74-2818962
WNOK Acquisition Company, Inc. Delaware 4832 74-2818961
</TABLE>
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TABLE OF CONTENTS
FORM 10-K
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PART I
Item 1. Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Item 2. Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Item 3. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Item 4. Submission of Matters to a Vote of Security-Holders . . . . . . . . . . . . . . . . . . . . . . . . 39
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters . . . . . . . . . . . . . . . 40
Item 6. Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . 41
Item 8. Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure . . . . . . . . 80
PART III
Item 10.Directors and Executive Officers of the Registrant . . . . . . . . . . . . . . . . . . . . . . . . . 80
Item 11.Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
Item 12.Security Ownership of Certain Beneficial Owners and Management . . . . . . . . . . . . . . . . . . 86
Item 13.Certain Relationships and Related Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . 86
PART IV
Item 14.Exhibits, Financial Statement Schedules, and Reports on Form 8-K . . . . . . . . . . . . . . . . . . 86
</TABLE>
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PART I
ITEM 1. BUSINESS
GENERAL
As used in this Annual Report on Form 10-K, unless otherwise specified, the
"Company" means Commodore Media, Inc. and its subsidiaries after consummation
of the Osborn Transactions (as defined) and the Pending Acquisitions (as
defined). The Company is a wholly-owned subsidiary of Capstar Broadcasting
Partners, Inc. ("Capstar") and conducts its business through its subsidiaries,
including Commodore Holdings, Inc. ("CHI") and Osborn Communications
Corporation ("Osborn"). Certain capitalized terms used in this Annual Report
on Form 10-K are defined herein under the caption "Glossary of Certain Terms
and Market and Industry Data."
The Company was formed in 1980 and is a broadcasting company
primarily engaged in the acquisition and operation of radio stations in
mid-sized markets. The Company generally defines mid-sized markets as those
Metropolitan Statistical Areas ("MSAs") ranked between 50 and 200, each of
which has approximately $10.0 million to $35.0 million in radio advertising
revenue. Upon completion of the Pending Acquisitions, the Company will be the
largest radio broadcaster in the United States operating exclusively in
mid-sized markets. Upon completion of the Osborn Transactions, the Company will
own and operate or provide services to 53 radio broadcasting stations in 12
mid-sized markets located primarily in the northeastern and southeastern United
States. The Company or Capstar or one of its direct subsidiaries (other than
the Company) has also entered into agreements to acquire 68 additional stations
(collectively, the "Pending Acquisitions"). Each of the Pending Acquisitions
to which Capstar or one of its direct subsidiaries (other than the Company) is
a party will be assigned or otherwise transferred to the Company prior to
consummation thereof. Upon completion of the Osborn Transactions and the
Pending Acquisitions, the Company will own and operate or provide services to
121 radio broadcasting stations in 31 mid-sized markets located throughout the
country. The Company's stations comprise the leading radio group, in terms of
revenue share and/or audience share, in 23 of these markets.
In February 1996, as a result of the passage of the
Telecommunications Act of 1996 (the "Telecom Act"), radio broadcasting
companies were permitted to increase their ownership of stations within a
single market from a maximum of four to a maximum of between five and eight
stations, depending on market size. More importantly, the Telecom Act also
eliminated the national ownership restriction that generally had limited
companies to the ownership of no more than 40 stations (20 AM and 20 FM)
throughout the United States. In order to capitalize on the opportunities
created by the Telecom Act, R. Steven Hicks, an executive with over 30 years of
experience in the radio broadcasting industry, and Hicks, Muse, Tate & Furst
Incorporated, a private investment firm based in Dallas, New York, St. Louis
and Mexico City that specializes in acquisitions, recapitalizations and other
principal investing activities ("Hicks Muse"), formed Capstar to acquire and
operate radio station clusters in mid-sized markets. In October 1996, Capstar
purchased the Company for approximately $213.6 million, which includes assumed
debt, and the Company became a wholly-owned subsidiary of Capstar.
The Company believes that mid-sized markets represent attractive
operating environments because, as compared to the 50 largest markets in the
United States, they are generally characterized by (i) lower radio station
purchase prices as a multiple of broadcast cash flow, (ii) less sophisticated
and undercapitalized competitors, including both radio and competing
advertising media such as newspaper and television, and (iii) less direct
format competition resulting from fewer stations in any given market. The
Company believes that the attractive operating characteristics of mid-sized
markets coupled with the opportunity created by the Telecom Act to create
in-market radio station cluster groups will create the ability to achieve
substantial revenue growth and cost efficiencies. As a result, management
believes that the Company can generate broadcast cash flow margins that are
comparable to the higher margins that heretofore were generally achievable only
in the top 50 markets.
To effectively and efficiently manage its stations, Capstar and the
Company have developed a flexible management structure designed to manage a
large and growing portfolio of radio stations throughout the United States.
The station portfolio will be organized into three regions, the Northeast, the
Southeast and the West, each of which will be managed by regional executives in
conjunction with general managers in each of the Company's markets.
STATION PORTFOLIO
In February 1997, the Company completed the purchase of Osborn (the
"Osborn Acquisition") for $127.7 million, which included the repayment of
outstanding indebtedness of Osborn. Upon consummation of the Osborn
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Acquisition, Osborn owned and operated or provided services, through its
directly and indirectly wholly-owned subsidiaries, to 18 radio stations (12 FM
and six AM). The Osborn purchase price also includes the purchase of five
stations in Huntsville and Tuscaloosa, Alabama (the "Osborn Add-on
Acquisitions") and the disposition of three stations in Ft. Myers, Florida (the
"Osborn Ft. Myers Disposition" and, together with the Osborn Acquisition and
the Osborn Add- on Acquisitions, the "Osborn Transactions"), each of which is
expected to be completed during the second quarter of 1997. The Osborn
Transactions will provide the Company with 20 stations (12 FM and eight AM)
located in six additional mid-sized markets in the southeastern United States.
In addition to radio broadcasting, Osborn's operations include several
broadcast-related businesses: the ownership of a 2,500-seat music theater and
the staging of an annual four-day country music festival known as Jamboree in
the Hills, both of which are promoted in conjunction with the operation of
Osborn's radio stations in Wheeling, West Virginia; the distribution of
programmed music, primarily Muzak; and, in conjunction with the programmed
music distribution business, the design, sale and installation of sound,
closed-circuit video and security systems. Upon consummation of the Osborn
Transactions, the Company will own and operate or provide services to 53 radio
stations (31 FM and 22 AM) in 12 mid-sized markets. On a pro forma basis after
giving effect to the Osborn Transactions as if they had occurred on January 1,
1996, the Company would have had net revenue and broadcast cash flow of $85.6
million and $25.3 million, respectively, for the year ended December 31, 1996.
In addition to the Osborn Transactions, the Company or Capstar has
agreed, subject to various conditions, to acquire 68 additional radio stations
(46 FM and 22 AM) in 11 separate transactions for an aggregate purchase price
of $290.6 million. Each of the Pending Acquisitions to which Capstar or one of
its direct subsidiaries (other than the Company) is a party will be assigned or
otherwise transferred to the Company prior to consummation thereof. Upon
consummation of the Osborn Transactions and the Pending Acquisitions, the
Company's portfolio will be comprised of three geographical regions -- the
Northeast Region, the Southeast Region and the West Region -- which will
include a total of 121 stations located in 31 mid-sized markets in the United
States.
<TABLE>
<CAPTION>
COMPANY COMPANY
COMPANY REVENUE AUDIENCE
MSA STATIONS SHARE SHARE
---------------
MARKET(1) RANK(2) FM AM RANK(3) RANK(4) SOURCE COMPANY
--------- ------- -- -- ------- ------- --------------
<S> <C> <C> <C> <C> <C>
NORTHEAST REGION
Allentown-Bethlehem, PA(5) . . . . . . . . . 64 2 2 1 1 CHI
Melbourne-Titusville-Cocoa, FL . . . . . . . 96 3 2 1 1 EZY/City/Roper
Fairfield County, CT(6) . . . . . . . . . . . 112 3 3 1 2 CHI
Ft. Pierce-Stuart-Vero Beach, FL(5)(7) . . . 121 6 1 1 1 CHI/Indian River
Huntington, WV-Ashland, KY(5) . . . . . . . . 139 5 5 1 1 CHI
Salisbury-Ocean City, MD . . . . . . . . . . 153 2 -- 3 3 Benchmark
Dover, DE . . . . . . . . . . . . . . . . . . NA 2 1 1 NA Benchmark
Wilmington, DE . . . . . . . . . . . . . . . NA 1 1 2 1 CHI
Westchester-Putnam Counties, NY(8) NA 3 2 NA 1 CHI
-- --
SUBTOTAL . . . . . . . . . . . . . . . 27 17
SOUTHEAST REGION
Greenville, SC . . . . . . . . . . . . . . . 59 3 1 2 2 Benchmark
Columbia, SC . . . . . . . . . . . . . . . . 88 4 2 1 2 Benchmark/Emerald City
Huntsville, AL . . . . . . . . . . . . . . . 114 1 2 1 1 Osborn
Jackson, MS . . . . . . . . . . . . . . . . . 118 2 2 2 2 Benchmark
Shreveport, LA . . . . . . . . . . . . . . . 126 1 1 2 3 Benchmark
Montgomery, AL . . . . . . . . . . . . . . . 142 3 -- 2 1 Benchmark
Asheville, NC . . . . . . . . . . . . . . . . 179 1 1 1 1 Osborn
Tuscaloosa, AL . . . . . . . . . . . . . . . 212 2 1 1 1 Osborn
Wheeling, WV(5) . . . . . . . . . . . . . . . 213 5 2 1 1 Osborn
Winchester, VA . . . . . . . . . . . . . . . 219 2 1 NA 1 Benchmark
Jackson, TN . . . . . . . . . . . . . . . . . 257 2 1 NA 1 Osborn
Roanoke, VA . . . . . . . . . . . . . . . . . NA 3 1 1 1 Benchmark/Cavalier
Lynchburg, VA . . . . . . . . . . . . . . . . NA 3 1 1 1 Benchmark/Cavalier
Statesville, NC . . . . . . . . . . . . . . . NA 1 1 NA NA Benchmark
Gadsden, AL(9) . . . . . . . . . . . . . . . NA 1 1 NA 1 Osborn
-- --
SUBTOTAL . . . . . . . . . . . . . . . 34 18
</TABLE>
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<TABLE>
<CAPTION>
COMPANY COMPANY
COMPANY REVENUE AUDIENCE
MSA STATIONS SHARE SHARE
---------------
MARKET(1) RANK(2) FM AM RANK(3) RANK(4) SOURCE COMPANY
--------- ------- -- -- ------- ------- --------------
<S> <C> <C> <C> <C> <C> <C>
WEST REGION
Stockton, CA(5) . . . . . . . . 85 1 1 3 3 Community Pacific
Des Moines, IA(5) . . . . . . . 89 2 1 3 3 Community Pacific
Madison, WI . . . . . . . . . . 120 4 2 1 1 Madison
Modesto, CA(5) . . . . . . . . 121 1 1 2 2 Community Pacific
Anchorage, AK(5) . . . . . . . 165 4 2 1 1 Community Pacific/COMCO
Fairbanks, AK(6) . . . . . . . NA 2 1 NA 1 COMCO
Yuma, AZ . . . . . . . . . . . NA 2 1 NA 1 Commonwealth
-- --
SUBTOTAL . . . . . . . . 16 9
-- --
TOTAL(10) . . . . . . . 77 44
== ==
</TABLE>
NA Information not available.
(1) Actual city of license may be different from metropolitan market served.
Market may be different from market definition used under FCC multiple
ownership rules.
(2) MSA rank obtained from Arbitron's (as defined) Summer 1996 Radio Market
Survey Schedule. (3) Company revenue share rank compiled from data in BIA
Publications Radio Analyzer-BIA's Master Access, Version 1.7
(copyright 1996) (data current as of September 4, 1996).
(4) Company audience share rank obtained from Arbitron's Radio Market Reports,
based on average quarter hour estimates for the last available reporting
period ending either Spring or Summer 1996 for the demographic of persons
ages 25-54, listening Monday through Sunday, 6 a.m. to midnight, except for
the Yuma, Arizona market which was obtained from AccuRatings(TM) (as
defined). To account for listeners lost to other nearby markets, a radio
station's "local" audience share is derived by comparing the radio
station's average quarter hour share to the total average quarter hour
share for all stations whose signals are heard within the MSA, excluding
audience share for listeners who listen to stations whose signals originate
outside the MSA.
(5) The Company provides certain sales and marketing services to stations
WKAP-AM in Allentown, Pennsylvania, WPAW-FM in Ft. Pierce-Stuart-Vero
Beach, Florida and WEEL-FM in Wheeling, West Virginia, pursuant to a JSA
(as defined). The Company provides certain sales, programming and marketing
services to station WHRD-AM in Huntington, West Virginia, and, pending
consummation of the Community Pacific Acquisition (as defined), to stations
KFIV-AM and KJSN-FM in Modesto, California, KVFX-FM and KJAX-FM in
Stockton, California, KASH-FM, KENI-AM and KBFX in Anchorage, Alaska, and
KDMI-AM, KHKI-FM and KGGO-FM in Des Moines, Iowa, pursuant to an LMA (as
defined). The chart includes these stations.
(6) Fairfield County is a Custom Survey Area ("CSA") as defined by Arbitron.
The CSA includes the Arbitron markets of Bridgeport, Stamford-Norwalk and
Danbury, Connecticut with market rankings of 112, 132 and 191,
respectively. MSA rank is listed for the Bridgeport market only. The
combined rank for the CSA has not been estimated. Fairbanks, Alaska is a
CSA as defined by Arbitron, for which audience share rank was obtained from
Arbitron's Spring 1996 CSA Market Report.
(7) A third party has filed a petition for reconsideration with the FCC
requesting reconsideration of the FCC's grant of the application for
transfer of control of station WOSN-FM to the Company. Indian River (as
defined) has accused the Company of breach of contract and has refused to
close the Indian River Acquisition (as defined). The Company does not
believe that it has breached the acquisition agreement and has filed a
complaint against Indian River in the Circuit Court of the Nineteenth
Judicial Circuit, Indiana River, Florida to enforce its rights under the
acquisition agreement. See "--The Acquisitions--Indian River Acquisition."
(8) Westchester-Putnam Counties, New York are a sub-set of the greater New York
City Metropolitan Area, which is ranked as the largest MSA by Arbitron.
(9) Company audience share rank obtained from Arbitron's June 1996 County
Report (for field work performed in 1995) survey, from the County of
Etowah, Alabama which is Gadsden's home county.
(10)The chart does not include (i) stations to be disposed of in connection
with the Osborn Ft. Myers Disposition, (ii) station WING-FM in Dayton,
Ohio, which is owned by the Company and for which an unrelated third party,
who has an option to purchase such station, currently provides certain
sales, programming and marketing services pursuant to an LMA, (iii) station
WDRR-FM in Ft. Myers, Florida, in which the Company owns a 50% nonvoting
interest and which the Company intends to sell or (iv) station KASH-AM in
Anchorage, Alaska, which the Company will own upon consummation of the
acquisition of Community Pacific (as defined), but expects to sell
subsequent thereto to remain in compliance with the station ownership
limitations under the Communications Act of 1934, as amended (the
"Communications Act"). See "--The Acquisitions."
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STRATEGY
Acquisition Strategy
The Company seeks to become the leading consolidator of radio stations
in mid-sized markets throughout the United States. Management expects to
achieve this objective through the application of an acquisition strategy that
it believes will allow the Company to develop radio station clusters at
attractive prices. First, the Company intends to enter attractive new mid-sized
markets by acquiring a leading station (or a group that owns a leading station)
in such market. The Company then intends to utilize the initial acquisition as
a platform to acquire additional stations which further enhance the Company's
position in a given market. Management believes that once it has established
operations in a market with an initial acquisition, it can acquire additional
stations at reasonable prices and, by leveraging its existing infrastructure,
knowledge of and relationships with advertisers and substantial management
experience, improve the operating performance and financial results of those
stations.
Operating Strategy
The Company's objective is to maximize the broadcast cash flow of each
of its radio station clusters through the application of the following
strategies:
Enhance Revenue Growth through Multiple Station Ownership. Management
believes that the ownership of multiple stations in a market allows the Company
to coordinate its programming to appeal to a broad spectrum of listeners. Once
the station cluster has been created, the Company can provide one-stop shopping
to advertisers attempting to reach a wide range of demographic groups.
Simplifying the buying of advertising time for customers encourages increased
advertiser usage thereby enhancing the Company's revenue generating potential.
Broad demographic coverage also allows the Company to compete more effectively
against alternative media, such as newspaper and television, thus potentially
increasing radio's share of the total advertising dollars spent in a given
market.
Create Low Cost Operating Structure. Management believes that it is
less expensive to operate radio stations in mid-sized markets than in large
markets for several reasons. First, because stations in mid-sized markets
typically have less direct format competition, the Company is less reliant on
expensive on-air talent and costly advertising and promotional campaigns to
capture listeners. Second, the ownership of multiple stations within a market
allows the Company to achieve substantial cost savings through the
consolidation of facilities, management, sales and administrative personnel,
operating resources (such as on-air talent, programming and music research) and
through the reduction of redundant corporate expenses. Furthermore, management
expects that the Company, as a result of the large size of its portfolio,
combined with the consolidated purchasing power of the Hicks Muse portfolio
companies, will be able to realize substantial economies of scale in such areas
as national representation commissions, employee benefits, casualty insurance
premiums, long distance telephone rates and other operating expenses. Finally,
the incorporation of digital automation in certain markets allows the Company
to operate radio stations at off-peak hours with minimal human involvement
while improving the quality of programming.
Utilize Sophisticated Operating Techniques. Following the acquisition
of a station or station group, the Company will seek to capitalize on
management's extensive large market operating experience by implementing
sophisticated techniques such as advertising inventory management systems,
sales training programs and in-depth music research studies which improve both
the efficiency and profitability of its stations. Prior to the passage of the
Telecom Act, management believes that many operators in mid-sized markets did
not generate sufficient revenue to justify the incurrence of expenditures to
develop these techniques.
Provide Superior Customer Service. The Company believes that
advertising customers in mid-sized markets typically do not have extensive
resources to create and implement advertising campaigns. The Company provides
many of its advertising customers with extensive advertising support which may
include (i) assistance in structuring advertising and promotional campaigns,
(ii) creating and producing customer advertisements and (iii) analyzing the
effectiveness of the customer's media programs. Management believes that this
type of superior customer service attracts new customers to the Company and
increases the loyalty of the Company's existing customers, thereby providing
stability to the Company's revenue, often despite fluctuations in station
ratings.
Develop Decentralized Management Structure. The Company will seek to
develop experienced, highly motivated, regional and local management teams,
derived primarily from station groups acquired by the Company, and will
decentralize decision-making so that these regional and local managers will
have the flexibility to develop operating
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cultures that capitalize on the unique qualities of each region and market. The
Company will also rely on local managers to source additional acquisition
opportunities. In addition, in order to incentivize regional management, the
Company intends to implement a program that links compensation to regional
operating performance as well as the combined results of the Company.
MANAGEMENT
The Company has designed an organizational structure to effectively
manage its existing station portfolio as well as to accommodate future
in-market or group acquisitions. Each of the Company's existing and future
operating regions will be headquartered within the region and staffed with a
team of regional executives who will manage the operations of that region's
station portfolio. A chief executive officer and/or a chief operating officer
of each region will oversee the regional and general managers of the stations
within a particular region. In addition, a controller in each region will
directly oversee the business managers of the stations within a region. Each
regional operating executive will report directly to R. Steven Hicks, the Chief
Executive Officer of the Company and the President and Chief Executive Officer
of Capstar, while each regional controller will report to Capstar's chief
financial officer. The Company's regional executive management teams will be
compensated based upon the financial performance of their respective regions
and Capstar and its subsidiaries as a whole with such compensation awarded in
the form of cash bonuses and stock options. Management believes that this
compensation structure will foster teamwork and the sharing of the best
practices across regions to maximize the overall financial performance of the
Company. In assembling each of the existing regional management teams, the
Company has sought to retain the senior management of some of the station
groups that it has acquired so as to (i) retain and capitalize on the local
market experience and knowledge of these experienced executives and (ii) foster
a culture that is consistent with the unique attributes of each of the local
markets acquired. Furthermore, the Company believes that each of its regional
executives possesses considerable knowledge of its region's competitors and is
therefore well situated to identify strategic acquisition candidates. Each of
the Company's regional executives has invested, or intends to invest, in the
capital stock of Capstar.
Each of the Company's regional executives has extensive experience
operating radio stations in mid-sized markets, as described below.
Northeast Region. The chief executive officer of the Northeast Region
is James T. Shea, Jr., the President (and former Chief Operating Officer) of
the Company. Mr. Shea has more than 20 years of experience in the radio
broadcasting industry. Mr. Shea's operating knowledge and strong advertiser
relationships helped the Company, prior to its acquisition by Capstar, become a
leading radio group in each of its markets. Pro forma for the Osborn
Transactions and the Pending Acquisitions, Mr. Shea will manage 44 stations in
nine markets in the Northeast Region.
Southeast Region. Frank D. Osborn, the President and Chief Executive
Officer of Osborn since its inception in 1984, is the chief executive officer
of the Southeast Region. Mr. Osborn brings more than 19 years of radio industry
experience to the Company, including prior positions as Senior Vice President
of Price Communications, Vice President of Finance and Administration at NBC
Radio and General Manager of WYNY-FM in New York City. Mr. Osborn has been
successful in developing leading station clusters in each of Osborn's markets.
The Company intends to hire a chief operating officer for the Southeast Region,
who will assist Mr. Osborn in overseeing the operations of the radio stations
in the region. Pro forma for the Osborn Transactions and the Pending
Acquisitions, the Southeast Region will include 52 stations in 15 markets.
West Region. The West Region will be managed by two radio executives,
David J. Benjamin and Claude C. Turner (also known as Dex Allen), with an
aggregate of 52 years of experience in the radio broadcasting industry. Mr.
Benjamin, the current President and Chief Executive Officer of Community
Pacific Broadcasting Company L.P. ("Community Pacific"), will serve as the
chief executive officer of the West Region upon consummation of the Community
Pacific Acquisition (as defined). Mr. Allen has served as the managing member
of Commonwealth Broadcasting of Arizona, L.L.C. ("Commonwealth") since 1984 and
is expected to continue to serve in such position until the consummation of the
Commonwealth Acquisition (as defined). Mr. Allen became the president and chief
operating officer of the West Region effective January 1, 1997. Pro forma for
the Pending Acquisitions, the West Region will include 25 stations in seven
markets.
THE ACQUISITIONS
The Company acquired Osborn and will complete certain pending
acquisitions of Osborn for a purchase price of $127.7 million, including the
repayment of outstanding indebtedness of Osborn. The purchase price includes
$113.0 million for the 18 stations that are owned and operated or
8
<PAGE> 9
to which services are provided by the Company and $25.7 million for the five
stations in the Huntsville and Tuscaloosa, Alabama markets which will be
acquired as part of the Osborn Add-on Acquisitions and excludes $11.0 million
to be received by the Company upon the disposition of three stations in the Ft.
Myers, Florida market in connection with the Osborn Ft. Myers Disposition. The
Osborn Add-on Acquisitions are expected to close in April and May 1997 and the
Osborn Ft. Myers Disposition is expected to close in April 1997.
In addition to the Osborn Transactions, the Company or Capstar has
agreed, subject to various conditions, to acquire (i) in the Northeast Region,
substantially all of the assets of Indian River Shores Partners, L.C. ("Indian
River"), City Broadcasting Co., Inc. ("City"), EZY Com, Inc. ("EZY") and Roper
Broadcasting, Inc. ("Roper"), (ii) in the Northeast Region and the Southeast
Region, Benchmark Communications Radio Limited Partnership, L.P. and certain of
its subsidiary partnerships (collectively, "Benchmark"), (iii) in the Southeast
Region, substantially all of the assets of Cavalier Communications, L.P.
("Cavalier") and Emerald City Radio Partners, L.P. ("Emerald City"), and (iv)
in the West Region, substantially all of the assets of COMCO Broadcasting, Inc.
("COMCO"), Commonwealth, The Madison Radio Group ("Madison") and Community
Pacific, for an aggregate purchase price of $290.6 million. Each of the
Pending Acquisitions to which Capstar or one of its direct subsidiaries (other
than the Company) is a party will be assigned or otherwise transferred to the
Company prior to consummation thereof. Upon consummation of the Osborn
Transactions and the Pending Acquisitions, the Company will have acquired or
agreed to provide services to a total of 88 radio stations for an aggregate
purchase price of approximately $418.3 million and, as a result, the Company
will own and operate or provide services to 121 radio stations.
PENDING ACQUISITIONS
<TABLE>
<CAPTION>
ESTIMATED
PURCHASE PRICE
OF PENDING COMPANY
ACQUISITION STATIONS EXPECTED
-------------
COMPANY ($ IN MILLIONS) FM AM REGION CLOSING DATE
------- --------------- -- -- -------------- ------------
<S> <C> <C> <C> <C> <C>
Indian River . . . . $ 1.6 1 -- Northeast Not Determinable (1)
City . . . . . . . . 3.0 1 1 Northeast April 1997
EZY . . . . . . . . . 5.0 1 1 Northeast April 1997
Roper . . . . . . . . 4.0 1 -- Northeast April 1997
Benchmark . . . . . . 173.4 21 10 Southeast/Northeast June 1997
Cavalier . . . . . . 8.3 4 1 Southeast October 1997
Emerald City . . . . 9.5 1 -- Southeast July 1997
COMCO . . . . . . . . 6.7 4 2 West October 1997
Commonwealth . . . . 5.3 2 1 West October 1997
Madison . . . . . . . 38.8 4 2 West October 1997
Community Pacific . . 35.0 6 4 West November 1997
----- -- --
Total . . . . . . 290.6 46 22
===== == ==
</TABLE>
(1) See "--The Acquisitions--Indian River Acquisition."
The Company must obtain additional financing to consummate the Osborn
Add-on Acquisitions and the Pending Acquisitions, and there can be no assurance
that such financing will be available to the Company on terms acceptable to its
management or at all. Consummation of each of the Osborn Add-on Acquisitions,
the Osborn Ft. Myers Disposition and the Pending Acquisitions is subject to
numerous conditions, including approval of the Federal Communications
Commission (the "FCC") and, where applicable, satisfaction of any requirements
and any applicable waiting periods under the Hart- Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act"); accordingly, the actual
date of consummation of each of the Osborn Add-on Acquisitions, the Osborn Ft.
Myers Disposition and the Pending Acquisitions may vary from the anticipated
closing dates. Further, no assurances can be given that the Osborn Add-on
Acquisitions and the Pending Acquisitions will be consummated or that, if
completed, they will be successful. For further information concerning the
Acquisitions, see "-- Risks Associated with Business Activities -- Risks of
Acquisition Strategy."
Osborn Acquisition. On February 20, 1997, the Company acquired
Osborn. The purchase price of the Osborn Acquisition was approximately $113.0
million (including the repayment of outstanding indebtedness of Osborn and
approximately $3.2 million payable in cash to Frank D. Osborn, the President
and Chief Executive Officer of Osborn, upon the sale of Osborn under the terms
of a letter agreement between Mr. Osborn and Osborn that entitled him to such
payment upon completion of a sale of Osborn). The purchase price included
approximately $91.8 million paid in cash
9
<PAGE> 10
and $1.8 million paid in shares of Class A common stock, par value $.01 per
share ("Capstar Common Stock"), of Capstar.
Osborn Add-on Acquisitions and Osborn Ft. Myers Disposition. On
December 18, 1996, Osborn agreed to acquire substantially all of the assets of
Taylor Communications Corporation ("Taylor") utilized in the operations of
Taylor's stations in the Tuscaloosa, Alabama market (the "Osborn Tuscaloosa
Acquisition"). The purchase price of the Osborn Tuscaloosa Acquisition will
equal approximately $1.0 million payable in cash. Taylor owns and operates two
stations (WACT-AM and WACT-FM) in the Tuscaloosa, Alabama market. In March
1997, the FCC approved transfer of control of these radio stations to the
Company. No filing under the HSR Act is required. Osborn has placed $50,000 in
cash in escrow as security for its obligations under the asset purchase
agreement.
On November 20, 1996, Osborn agreed to acquire (the "Osborn Huntsville
Acquisition" and collectively with the Osborn Tuscaloosa Acquisition, the
"Osborn Add-on Acquisitions") all of the issued and outstanding capital stock
of Dixie Broadcasting, Inc. ("Dixie") and Radio WBHP, Inc. ("Radio WBHP"). The
purchase price of the Osborn Add-on Acquisitions will equal approximately $25.7
million (including $24.0 million payable in cash at the closings and the
present value (approximately $1.7 million) of payments to be made after
consummation of the Osborn Huntsville Acquisition pursuant to a consulting
agreement). Such acquired companies own and operate three stations (one FM and
two AM) in the Huntsville, Alabama market. In March 1997, the FCC approved
transfer of control of Dixie's and Radio WBHP's respective radio stations to
Osborn, and Osborn and the Company filed an application with the FCC for
approval to transfer control of the stations to the Company. No filing under
the HSR Act is required. Osborn has placed $500,000 in cash in escrow as
security for its obligations under the stock purchase agreement. If the stock
purchase agreement is terminated by Dixie and Radio WBHP due to, among other
things, Osborn's material breach of any of its representations, warranties or
obligations under the stock purchase agreement, then Dixie and WBHP shall be
entitled to the escrowed funds. If the stock purchase is consummated the
escrowed funds will be disbursed to Dixie and WBHP in partial satisfaction of
the purchase price.
On December 24, 1996, Osborn agreed to sell substantially all of the
assets owned by Osborn that are used or held for use in connection with the
business and operations of Osborn's stations WKII-AM and WFSN-FM in Port
Charlotte, Florida and WOLZ-FM in Ft. Myers, Florida (the "Osborn Ft. Myers
Disposition"). The Company will receive approximately $11.0 million payable in
cash upon consummation of the Osborn Ft. Myers Disposition. Osborn has entered
into an LMA with the acquiror pursuant to which the acquiror is providing
certain sales, programming and marketing services for such stations. In March
1997, the FCC approved the assignment of Osborn's radio stations in Port
Charlotte and Ft. Myers, Florida to the purchaser. No filing under the HSR Act
is required.
The Company anticipates that the Osborn Add-On Acquisitions will be
consummated in April and May 1997, respectively, and that the Osborn Ft. Myers
Disposition will be consummated in April 1997.
Indian River Acquisition. On September 26, 1996, the Company agreed
to acquire substantially all of the assets of Indian River used in the
operation of Indian River's station in the Ft. Pierce-Stuart-Vero Beach,
Florida market (the "Indian River Acquisition"). The purchase price of the
Indian River Acquisition will equal approximately $1.6 million payable in cash.
The Company has placed $100,000 in cash in escrow as security for its
obligations under the asset purchase agreement. The FCC granted the application
for assignment of the broadcast license for WOSN-FM to the Company on November
25, 1996. In December 1996, however, a third party filed a petition for
reconsideration with the FCC requesting reconsideration of the FCC's grant. In
addition, Indian River has accused the Company of breach of contract and has
refused to close the Indian River Acquisition. The Company does not believe
that it has breached the acquisition agreement and filed a complaint against
Indian River in the Circuit Court of the Nineteenth Judicial Circuit, Indian
River, Florida to enforce its rights under the acquisition agreement. No
assurances can be given that the FCC matter will be resolved favorably or that
the Indian River Acquisition will be consummated. No filing under the HSR Act
is required.
Space Coast Acquisitions. On October 22, 1996, Capstar
Broadcasting-Florida, Inc., a direct subsidiary of Capstar ("Capstar-Florida"),
agreed to acquire substantially all of the assets of City (the "City
Acquisition"). The purchase price of the acquisition will equal approximately
$3.0 million payable in cash. City owns and operates WGGD-FM and WMMB-AM in the
Melbourne-Titusville-Cocoa, Florida market. The FCC has approved transfer of
control of such radio stations to the Company. No filing under the HSR Act is
required.
On October 22, 1996, Capstar-Florida agreed to acquire substantially
all of the assets of EZY (the "EZY Acquisition"). The purchase price of the
acquisition will equal approximately $5.0 million payable in cash. EZY owns
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<PAGE> 11
and operates stations (WLRQ-FM and WMYM-AM) in the Melbourne-Titusville-Cocoa,
Florida market. The FCC has approved transfer of control of such radio stations
to the Company. No filing under the HSR Act is required.
On October 22, 1996, Capstar-Florida agreed to acquire substantially
all of the assets of Roper (the "Roper Acquisition" and collectively with the
City Acquisition and the EZY Acquisition, the "Space Coast Acquisitions"). The
purchase price of the acquisition will equal approximately $4.0 million payable
in cash. Roper owns and operates station WHKR-FM in the
Melbourne-Titusville-Cocoa, Florida market. The FCC has approved transfer of
control of such radio station to the Company. No filing under the HSR Act is
required.
Under the terms of the acquisition agreement for each of the Space
Coast Acquisitions, all of which agreements were entered into by
Capstar-Florida, the acquisition agreement may be terminated by the seller
prior to consummation of the asset purchase under various circumstances,
including any material breach of a representation or warranty in the case of
Roper and EZY, or a breach of any representation or warranty in the case of
City, or any material breach of any covenant or agreement, by Capstar-Florida.
If the acquisition agreement with City, EZY or Roper, as applicable, is
terminated due to any material breach of any representation or warranty in the
case of Roper and EZY, or a breach of any representation or warranty in the
case of City, or any material breach of any covenant or agreement, by
Capstar-Florida, then City, EZY or Roper, as applicable, will be entitled to
liquidated damages in the amount of $150,000, $250,000 and $200,000,
respectively, as such seller's exclusive remedy. Capstar-Florida has secured
its obligation to consummate each asset purchase by placing into escrow letters
of credit, in the amount of liquidated damages under the respective acquisition
agreements.
The Company anticipates that the Space Coast Acquisitions will be
consummated in April 1997, immediately prior to which the acquisition agreement
for each of the Space Coast Acquisitions will be assigned to the Company.
Benchmark Acquisition. Under the terms of several acquisition
agreements, each dated as of December 9, 1996 (collectively, the "Benchmark
Acquisition Agreements"), entered into by Benchmark, Capstar, certain
wholly-owned subsidiaries (each a "Fund III Acquisition Sub") of Hicks, Muse,
Tate & Furst Equity Fund III, L.P., an affiliate of Hicks Muse, and other
signatories thereto, Benchmark will become an indirect wholly-owned subsidiary
of the Company through a series of mergers and stock purchases (collectively
with the Benchmark Montgomery Acquisition (as defined), the "Benchmark
Acquisition"). The purchase price of the Benchmark Acquisition will equal
approximately $173.4 million. Benchmark owns and operates 27 radio stations
(17 FM and 10 AM), and has agreed to acquire two radio stations in the
Montgomery, Alabama market (the "Benchmark Montgomery Acquisition"). Those
stations are located in 11 markets in the Southeastern United States, including
the Dover, Delaware; Salisbury-Ocean City, Maryland; Montgomery, Alabama;
Shreveport, Louisiana; Jackson, Mississippi; Statesville, North Carolina;
Columbia, South Carolina; Greenville, South Carolina; Roanoke, Lynchburg and
Winchester, Virginia markets. The Company anticipates that the Benchmark
Acquisition will be consummated in June 1997.
In connection with the Benchmark Acquisition, Joseph L. Mathias IV
will be entitled, at his election, to receive a certain number of shares of
Capstar Common Stock, in lieu of cash, in consideration of a portion of his
ownership interest in Benchmark.
The obligations of the Fund III Acquisition Subs and Benchmark to
consummate the Benchmark Acquisition are subject to the satisfaction at or
prior to the effective time of the Benchmark Acquisition of customary terms and
conditions, including (i) obtaining the requisite consent from the FCC to the
transfer of control of Benchmark's radio stations to the Company and (ii) the
termination of the applicable waiting period under the HSR Act. In January
1997, Capstar and Benchmark each filed (i) an application with the FCC for
approval to transfer control of Benchmark's radio stations to the Company and
(ii) a Notification and Report Form with the United States Department of
Justice ("DOJ") and the Federal Trade Commission (the "FTC"). On February 14,
1997, Capstar received a Second Request for information from the DOJ relating
to the Benchmark Acquisition, which focuses particularly on the Benchmark radio
stations in the Dover and Wilmington, Delaware areas. The applicable waiting
period under the HSR Act for the Benchmark Acquisition will expire 20 calendar
days after both Capstar and Benchmark substantially comply with the Second
Request, unless the parties agree to extend the waiting period or the DOJ seeks
to, and is successful in its efforts to, enjoin the Benchmark Acquisition.
Although the Company believes that the Benchmark Acquisition ultimately will be
consummated, there can be no assurance that the DOJ will clear the Benchmark
Acquisition in its current form or that Capstar, and ultimately, the Company,
or Benchmark will not be required to dispose of certain radio stations or take
other measures in order to consummate the Benchmark Acquisition. See "--
Federal Regulation of Radio Broadcasting."
The Benchmark Acquisition Agreements may be terminated by Benchmark
prior to consummation of the Benchmark Acquisition under various circumstances,
including a breach of one or more representations, warranties,
11
<PAGE> 12
covenants or agreements by a Fund III Acquisition Sub, which in the aggregate
has, or would reasonably be expected to have, a material adverse effect on
Benchmark and its subsidiaries, taken as a whole. If the Benchmark Acquisition
is not consummated due to a breach of one or more representations, warranties,
covenants or agreements in the Benchmark Acquisition Agreements by a Fund III
Acquisition Sub, which in the aggregate has, or would reasonably be expected to
have, a material adverse effect on Benchmark and its subsidiaries, taken as a
whole, then Benchmark will be entitled to liquidated damages in the amount of
$8.2 million as Benchmark's exclusive remedy. The Fund III Acquisition Subs
have secured their obligations to consummate the Benchmark Acquisition by
placing into escrow $410,000 in cash and a letter of credit in the amount of
$6.7 million. An additional $1.0 million in letters of credit may also be
placed in escrow by the Fund III Acquisition Subs under the terms of the
Benchmark Acquisition Agreements. See "Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operations -- Liquidity and
Capital Resources."
Benchmark Montgomery Acquisition. On November 4, 1996, Benchmark
agreed to acquire substantially all of the assets of Capital Communications
utilized in the operations of Capital Communications' three FM radio stations
in the Montgomery, Alabama market. The purchase price of the Benchmark
Montgomery Acquisition will equal approximately $19.9 million payable in cash
by Benchmark. A Fund III Acquisition Sub will loan Benchmark sufficient funds
to consummate the Benchmark Montgomery Acquisition. In January 1997, Benchmark
and Capstar filed an application with the FCC for approval of the transfer of
control of two of Capital Communications' stations to the Company. Benchmark
and Capstar intend to file an application for approval to transfer control of
the third station being acquired from Capital Communications. No filing under
the HSR Act is required. The Company anticipates that the Benchmark Montgomery
Acquisition will be consummated in April 1997. Benchmark has placed $1.0
million in cash in escrow as security for its obligations under the asset
purchase agreement.
Community Pacific Acquisition. On December 26, 1996, Pacific Star
Communications, Inc., a direct subsidiary of Capstar ("Pacific Star"), agreed
to acquire substantially all of the assets of Community Pacific (the "Community
Pacific Acquisition"). The purchase price of the Community Pacific Acquisition
will equal approximately $35.0 million payable in cash. Community Pacific owns
and operates 11 radio stations (six FM and five AM) in four markets located in
Anchorage, Alaska, Modesto and Stockton, California and Des Moines, Iowa. In
January 1997, Pacific Star and Community Pacific each filed an (i) application
with the FCC for approval to transfer control of such radio stations to the
Company and (ii) a Notification and Report Form with the DOJ and the FTC. The
applicable waiting period under the HSR Act terminated on February 21, 1997,
after which time, Pacific Star and Community Pacific entered into an LMA in
connection with Community Pacific's radio stations pursuant to which Pacific
Star provides certain sales, programming and marketing services to Community
Pacific's stations. In March 1997, the FCC approved the transfer of control of
such stations. The Company anticipates that the Community Pacific Acquisition
will be consummated in November 1997, prior to which time the acquisition
agreement will be assigned or otherwise transferred to the Company.
Under the terms of the acquisition agreement, which was entered into
by Pacific Star, the acquisition agreement may be terminated by Community
Pacific prior to consummation of the asset purchase under various
circumstances, including, but not limited to, a material breach of any
representation, warranty, covenant or agreement, by Pacific Star. If the
acquisition agreement is terminated due to a material breach of any
representation, warranty, covenant or agreement, by Pacific Star, then
Community Pacific will be entitled to liquidated damages in the amount of $2.6
million as Community Pacific's exclusive remedy. Pacific Star has secured its
obligation to consummate the asset purchase by placing into escrow a letter of
credit in the amount of $2.6 million.
Madison Acquisition. On January 27, 1997, Point Madison Acquisition
Company, Inc., a direct subsidiary of Capstar ("Madison Acquisition Co.")
agreed to acquire substantially all of the assets of Madison (the "Madison
Acquisition"). The purchase price of the Madison Acquisition will equal
approximately $38.8 million payable in cash. Madison owns and operates six
radio stations (four FM and two AM) in Madison, Wisconsin. In February 1997,
Madison Acquisition Co. and Madison filed an application with the FCC for
approval to transfer control of such radio stations to the Company. Madison
Acquisition Co. and Madison filed a Notification and Report Form with the DOJ
and the FTC in February 1997. The applicable waiting period under the HSR Act
terminated on March 11, 1997. The Company anticipates that the Madison
Acquisition will be consummated in October 1997, prior to which time the
acquisition agreement will be assigned or otherwise transferred to the Company.
Under the terms of the acquisition agreement, which was entered into
by Madison Acquisition Co., the acquisition agreement may be terminated by
Madison prior to consummation of the asset purchase under various
circumstances, including a material breach of any representation, warranty,
covenant or agreement by Madison Acquisition Co. If the acquisition agreement
is terminated due to a material breach of any representation, warranty,
covenant or agreement by Madison Acquisition Co., then Madison will be entitled
to liquidated damages in the amount
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<PAGE> 13
of $3.2 million as Madison's exclusive remedy. Madison Acquisition Co. has
secured its obligation to consummate the asset purchase by placing into escrow
a letter of credit in the amount of $3.2 million.
Commonwealth Acquisition. On January 27, 1997, Pacific Star agreed to
acquire substantially all of the assets of Commonwealth (the "Commonwealth
Acquisition"). The purchase price of the Commonwealth Acquisition will equal
approximately $5.3 million payable in cash. Commonwealth owns and operates
three radio stations (two FM and one AM) in Yuma, Arizona. In February 1997,
Pacific Star and Commonwealth filed an application with the FCC for approval to
transfer control of such radio stations to the Company. No filing under the HSR
Act is required. The Company anticipates that the Commonwealth Acquisition will
be consummated in October 1997, prior to which time the acquisition agreement
will be assigned or otherwise transferred to the Company.
Under the terms of the acquisition agreement, which was entered into
by Pacific Star, the acquisition agreement may be terminated by Commonwealth
prior to consummation of the asset purchase under various circumstances,
including a material breach of any representation, warranty, covenant or
agreement, by Pacific Star. If the acquisition agreement is terminated due to a
material breach of any representation, warranty, covenant or agreement by
Pacific Star, then Commonwealth will be entitled to liquidated damages in the
amount of $262,500 as Commonwealth's exclusive remedy. Pacific Star has
secured its obligation to consummate the asset purchase by placing into escrow
a letter of credit in the amount of $262,500.
Cavalier Acquisition. On January 27, 1997, Madison Acquisition Co.
agreed to acquire substantially all of the assets of Cavalier (the "Cavalier
Acquisition"). The purchase price of the Cavalier Acquisition will equal
approximately $8.3 million payable in cash. Cavalier owns and operates five
radio stations (four FM and one AM) in the Roanoke and Lynchburg, Virginia
markets. In February 1997, Madison Acquisition Co. and Cavalier filed an
application with the FCC for approval to transfer control of such radio
stations to the Company. No filing under the HSR Act is required. The Company
anticipates that the Cavalier Acquisition will be consummated in October 1997,
prior to which time the acquisition agreement will be assigned or otherwise
transferred to the Company.
Under the terms of the acquisition agreement, which was entered into
by Madison Acquisition Co., the acquisition agreement may be terminated by
Cavalier prior to consummation of the asset purchase under various
circumstances, including a material breach of any representation, warranty,
covenant or agreement by Madison Acquisition Co. If the acquisition agreement
is terminated due to a material breach of any representation, warranty,
covenant or agreement by Madison Acquisition Co., then Cavalier will be
entitled to liquidated damages in the amount of $900,000 as Cavalier's
exclusive remedy. Madison Acquisition Co. has secured its obligation to
consummate the asset purchase by placing into escrow a letter of credit in the
amount of $900,000.
COMCO Acquisition. On February 3, 1997, Pacific Star agreed to
acquire substantially all of the assets of COMCO (the "COMCO Acquisition"). The
purchase price of the COMCO Acquisition will equal approximately $6.7 million
payable in cash. COMCO owns and operates six radio stations (four FM and two
AM) in the Anchorage and Fairbanks, Alaska markets. Pacific Star and COMCO
filed an application with the FCC for approval to transfer control of such
radio stations to the Company in February 1997. No filing under the HSR Act is
required. The Company anticipates that the COMCO Acquisition will be
consummated in October 1997, prior to which time the acquisition agreement will
be assigned or otherwise transferred to the Company.
Under the terms of the agreement, which was entered into by Pacific
Star, the acquisition agreement may be terminated by COMCO prior to
consummation of the asset purchase under various circumstances, including a
material breach of any representation, warranty, covenant or agreement, by
Pacific Star. If the acquisition agreement is terminated due to a material
breach of any representation, warranty, covenant or agreement, by Pacific Star,
then COMCO will be entitled to liquidated damages in the amount of $335,000 as
COMCO's exclusive remedy. Pacific Star has secured its obligation to
consummate the asset purchase by placing into escrow a letter of credit in the
amount of $335,000.
Upon consummation of the Community Pacific Acquisition and the COMCO
Acquisition, the Company will own and operate seven radio stations (four FM and
three AM) in the Anchorage, Alaska market, which number exceeds the multiple
station ownership limitations under the Communications Act. Accordingly, the
Company has sought permission from the FCC to consummate both the Community
Pacific Acquisition
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<PAGE> 14
and the COMCO Acquisition provided that the Company agrees to sell radio
station KASH-AM in Anchorage, Alaska within 18 months of the date on which the
Community Pacific Acquisition is consummated. The Company would be in
compliance with the ownership limitations of the Communications Act in the
Anchorage, Alaska market once it disposes of KASH-AM. No assurances can be
given that the FCC will grant permission to the Company to consummate both the
Community Pacific Acquisition and the COMCO Acquisition and dispose of KASH-AM,
or if the FCC grants such permission, that the Company will be able to sell
KASH-AM. See "-- The Acquisitions -- Community Pacific Acquisition."
Emerald City Acquisition. On March 10, 1997, WNOK Acquisition
Company, Inc., a subsidiary of the Company ("WNOK Acquisition Co."), agreed to
acquire substantially all of the assets of Emerald City (the "Emerald City
Acquisition") used or useful in the operations of Emerald City's three radio
stations (two FM and one AM) in the Columbia, South Carolina market. Upon
consummation of the Emerald City Acquisition, the Company would own and operate
eight radio stations (five FM and three AM) in the Columbia, South Carolina
market, which number exceeds the multiple station ownership limitations under
the Communications Act. Accordingly, the Company expects to assign WNOK
Acquisition Co.'s right to acquire two of Emerald City's radio stations
(WOIC-AM and WMFX-FM) on or before the date on which the Company acquires
Emerald City's third radio station (WNOK-FM). No assurances can be given that
the Company will be able to find another buyer to acquire stations WOIC-AM and
WMFX-FM, or that if another buyer is found, the right to acquire such stations
will be assigned to the other buyer on terms favorable to the Company. The
purchase price of the Emerald City Acquisition will equal approximately $14.9
million payable in cash, of which approximately $9.5 million is expected to be
allocated to station WNOK-FM.
WNOK Acquisition Co. and Emerald City intend to file an application
with the FCC in April 1997 for approval to transfer control of WNOK-FM to the
Company. No assurances can be given that the FCC will grant permission to the
Company to consummate the Emerald City Acquisition. No filing under the HSR Act
is required. The Company anticipates that the Emerald City Acquisition will be
consummated in July 1997.
Under the terms of the agreement, the acquisition agreement may be
terminated by Emerald City prior to consummation of the asset purchase under
various circumstances, including a material breach of any representation,
warranty, covenant or agreement by WNOK Acquisition Co. If the acquisition
agreement is terminated due to a material breach of any representation,
warranty, covenant or agreement by WNOK Acquisition Co., then Emerald City will
be entitled to liquidated damages in the amount of $500,000 as Emerald City's
exclusive remedy. WNOK Acquisition Co. has secured its obligation to consummate
the asset purchase by placing into escrow cash in the amount of $75,000 and has
agreed that $425,000 of the loan described below will be forgiven if Emerald
City becomes entitled to liquidated damages.
In connection with the Emerald City Acquisition, the Company has
loaned Emerald City approximately $13.5 million, the proceeds of which were
used by Emerald City (i) to pay matured indebtedness of Emerald City to Clear
Channel Radio, Inc.in the amount of approximately $13.3 million, including
principal and interest, and (ii) for other business purposes in the amount of
approximately $200,000. The loan matures on the earlier to occur of (i)
October 31, 1997, (ii) the closing of the Emerald City Acquisition or (iii)
within 75 days after the termination of the acquisition agreement with WNOK
Acquisition Co.
Other Possible Acquisitions. The Company has entered into four
separate letters of intent to acquire substantially all of the assets of the
respective potential sellers used or useful in the operations of each such
seller's radio stations, each of which is subject to the ability of the Company
to enter into a definitive agreement to acquire such assets. No assurances can
be given that definitive agreements will be entered into to acquire such assets
or that, if entered into, the terms thereof will be favorable to the Company.
The Company is also currently evaluating certain other potential acquisition
opportunities. See "--Risks Associated with Business Activities--Risks of
Acquisition Strategy."
REGIONAL OPERATING GROUPS
Northeast Region
Upon consummation of the Pending Acquisitions, the Company's portfolio
of radio stations in the Northeast Region will include 44 radio stations (27 FM
and 17 AM) located in nine markets in Connecticut, Delaware, Florida, Kentucky,
Maryland, New York, Ohio, Pennsylvania and West Virginia. The Company will have
the leading radio station cluster based on revenue share rank in six of its
nine markets.
History. The Company, prior to its acquisition by Capstar, owned and
operated or provided services to 33 stations located in the following six
markets: Allentown-Bethlehem, Pennsylvania (four stations); Fairfield County,
Connecticut (six stations); Ft. Pierce-Stuart-Vero Beach, Florida (six
stations); Huntington, West Virginia-Ashland, Kentucky (10 stations);
Westchester-Putnam Counties, New York (five stations); and Wilmington, Delaware
(two stations). The Company entered each of these six markets with an initial
acquisition of one or two stations during the
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<PAGE> 15
1980's, which stations formed the initial basis for the Northeast Region. The
portfolio of the Company's stations has undergone significant growth during the
past two years, as the management team completed acquisitions of, or entered
into LMAs or JSAs with, 21 stations in the six original markets in 1995 and
1996, especially after the passage of the Telecom Act in February 1996. As a
result of the recent acquisition of many of the Company's stations, management
believes that the station clusters in the six original markets have not yet
realized the full potential of their recent consolidations.
The Pending Acquisitions will enhance the Company's Northeast Region
station portfolio through the addition of 11 stations in three new markets. The
Benchmark Acquisition will provide the Company with three stations in Dover,
Delaware and two stations in Salisbury-Ocean City, Maryland, the Space Coast
Acquisitions will provide the Company with five new stations in the
Melbourne-Titusville-Cocoa, Florida market and the Indian River Acquisition, if
consummated, will provide the Company with an additional station in the Ft.
Pierce-Stuart-Vero Beach, Florida market. See "--The Acquisitions." The
Company expects to realize substantial revenue growth and economies of scale
from these pending acquisitions in the Northeast Region because each of the
three new markets is adjacent to one of the original markets, as both the Dover
and Salisbury-Ocean City markets are near Wilmington, and
Melbourne-Titusville-Cocoa is adjacent to Ft. Pierce-Stuart-Vero Beach.
Management. The chief executive officer of the Northeast Region is
James T. Shea, Jr., the President (and former Chief Operating Officer) of the
Company, who has more than 20 years of experience in the radio broadcasting
industry. Under the guidance of Mr. Shea, the Company grew from 11 stations in
1992 to its current size. In addition, the Company realized compound annual
growth in estimated net revenue and broadcast cash flow of 28.7% and 32.6%,
respectively, for the three years ending December 31, 1996. Reporting to Mr.
Shea will be regional managers, each of whom will oversee the operations of
several markets. In addition, each of the markets in the Northeast Region will
be managed by a general manager who will manage the day-to-day operations of
the radio stations in each market.
Markets. Management believes that the station portfolio in the
Northeast Region has significant growth potential resulting from the recent
formation of station clusters in most of the Company's markets. The Company's
Allentown-Bethlehem, Pennsylvania market is the most developed of the Company's
original radio station clusters and has been operating as a cluster for
approximately two years. In this market, the Company owns or provides services
to four stations, including two of the five viable stations in the market. The
two FM and two AM stations target a broad demographic spectrum with four
different formats: News/Talk; Contemporary Hit Radio; Album Rock; and Middle of
the Road. The potential of radio station clustering is highlighted by this
group's results. The stations comprise the leading radio station group in the
market based on local audience share and maintain the number one revenue rank.
Furthermore, the cluster has increased net revenue from $7.4 million in 1993 to
an estimated $10.2 million in 1996, representing compound annual growth of
11.8%, and has increased its broadcast cash flow margins from 33.8% to 48.1%
during the same period. These financial results exclude station WKAP-AM, with
which the Company entered into a JSA in March 1995.
The Company seeks to replicate the success it has enjoyed in
Allentown-Bethlehem with station clusters in each of the other markets in the
Northeast Region. Management believes that the recently formed clusters in most
of the other markets in the region should be able to generate substantial cash
flow improvements given the Company's strong station positions. For example, in
Huntington, West Virginia-Ashland, Kentucky, the Company owns or provides
services to ten stations, including six of the ten viable stations in the
market. The Company acquired two of the stations in 1982, entered into LMAs
with eight additional stations in April 1996 and subsequently acquired seven of
these stations in October 1996. On a combined basis, this newly formed cluster
has the number one revenue and audience share ranks in the market. In markets
such as Salisbury-Ocean City, Maryland where the Company has only two stations,
the Company will seek to enhance its station cluster through future acquisitions
of additional stations, or, if that proves not to be feasible, consider exiting
the market.
15
<PAGE> 16
The following table summarizes certain information relating to the
Company's radio stations in the Northeast Region, assuming the consummation of
the Pending Acquisitions.
<TABLE>
<CAPTION>
TARGET COMPANY STATION
DEMO- REVENUE AUDIENCE
MARKET AND YEAR SOURCE MSA GRAPHIC SHARE SHARE
STATION CALL LETTERS(1) ACQUIRED COMPANY RANK(2) GROUP RANK(3) RANK(4) FORMAT
- ----------------------- -------- ------- ------- ----- ------- ------- ------
<S> <C> <C> <C> <C> <C> <C>
ALLENTOWN-BETHLEHEM, PA . 64 1
WAEB-AM . . . . . . . . 1982 CHI 35+ 6 News/Talk
WAEB-FM . . . . . . . . 1982 CHI W18-49 2 Contemporary Hits
Radio
WZZO-FM . . . . . . . . 1993 CHI M18-49 3 Album Rock
WKAP-AM(5) . . . . . . 1995 CHI 35+ 10t Middle-of-the-Road
MELBOURNE-TITUSVILLE- COCOA, FL 96 1
WMMB-AM . . . . . . . . 1986 City 50+ 6 Middle-of-the-Road
WGGD-FM . . . . . . . . 1986 City 35-64 4 Oldies
WMYM-AM . . . . . . . . 1982 EZY 35-64 8t Adult Contemporary
WLRQ-FM . . . . . . . . 1982 EZY 25-54 2 Adult Contemporary
WHKR-FM . . . . . . . . 1989 Roper 25-54 3 Classical
FAIRFIELD COUNTY, CT(6) . 112 1
WNLK-AM . . . . . . . . 1989 CHI 35+ 13 Talk
WEFX-FM . . . . . . . . 1989 CHI M18-49 5t Classic Rock
WSTC-AM . . . . . . . . 1996 CHI 25-54 10t News/Talk
WKHL-FM . . . . . . . . 1996 CHI 25-54 7 Oldies
WINE-AM . . . . . . . . 1996 CHI 25-54 12 News
WRKI-FM . . . . . . . . 1996 CHI M18-49 5t Album Rock
FT. PIERCE-STUART-VERO BEACH, FL 121 1
WZZR-FM . . . . . . . . 1987 CHI M18-49 1 Album Rock
WQOL-FM . . . . . . . . 1995 CHI 25-54 2 Oldies
WPAW-FM(5) . . . . . . 1995 CHI 25-54 7 Country
WBBE-FM . . . . . . . . 1996 CHI 25-54 8 Classic Country
WAVW-FM . . . . . . . . 1996 CHI 25-54 5 Country
WAXE-AM . . . . . . . . 1996 CHI 35+ 12 Nostalgia
WOSN-FM(7) . . . . . . Pending Indian River 25-54 NA
HUNTINGTON, WV-ASHLAND, KY 139 1
WTCR-AM . . . . . . . . 1982 CHI 25-54 12t Classic Country
WTCR-FM . . . . . . . . 1982 CHI 25-54 1 Country
WIRO-AM . . . . . . . . 1996 CHI M25-54 NA Sports
WHRD-AM(5) . . . . . . 1996 CHI M25-54 NA Sports
WZZW-AM . . . . . . . . 1996 CHI M25-54 NA Sports
WKEE-AM . . . . . . . . 1996 CHI 35t 12t Middle-of-the-Road
WKEE-FM . . . . . . . . 1996 CHI 25-54 2 Country
WAMX-FM . . . . . . . . 1996 CHI M25-54 5 Classic Rock
WFXN-FM . . . . . . . . 1996 CHI M25-54 9 Classical
WBVB-FM . . . . . . . . 1996 CHI M18-49 6 Adult Contemporary
SALISBURY-OCEAN CITY, MD 153 3
WWFG-FM . . . . . . . . 1993 Benchmark 25-54 1t Country
WOSC-FM . . . . . . . . 1994 Benchmark 18-34 6 Contemporary Hits
Radio
DOVER, DE . . . . . . . . NA 1
WDSD-FM . . . . . . . . 1990 Benchmark 25-54 NA Country
WSRV-FM . . . . . . . . 1994 Benchmark 25-54 NA Adult Contemporary
WDOV-AM . . . . . . . . 1990 Benchmark 25-54 NA News/Talk
WILMINGTON, DE . . . . . NA 2
WJBR-AM . . . . . . . . 1985 CHI W25-54 6 Middle-of-the-Road
WJBR-FM . . . . . . . . 1985 CHI 35+ 1 Adult Contemporary
WESTCHESTER-PUTNAM COUNTIES, NY(6)(8) NA NA
WFAS-AM . . . . . . . . 1986 CHI 35+ 5t Middle-of-the-Road
WPUT-AM . . . . . . . . 1996 CHI 35+ NA Country
WFAS-FM . . . . . . . . 1986 CHI W25-54 1 Adult Contemporary
WZZN-FM . . . . . . . . 1996 CHI W25-54 NA Album Rock
WAXB-FM . . . . . . . . 1996 CHI 25-54 NA Oldies
</TABLE>
- -------------------------
NA Information not available.
t Tied with another radio station.
(1) Actual city of license may be different from metropolitan market
served. Market may be different from market definition used under FCC
multiple ownership rules.
(2) MSA rank obtained from Arbitron's Summer 1996 Radio Market Survey
Schedule. Fairfield County is a CSA as defined by Arbitron. The CSA
includes the Arbitron markets of Bridgeport, Stamford-Norwalk, and
Danbury, Connecticut with market rankings of 112, 132, and 191,
respectively. MSA Rank is listed for the Bridgeport market only. The
combined rank for the CSA has not been estimated.
(3) Company revenue share rank obtained from data in BIA Publications
Radio Analyzer -- BIA's Master Access, Version 1.7 (copyright 1996)
(data current as of September 4, 1996) and based on 1995 gross revenue
for the indicated markets, on a company-by-company basis. Ranking for
the Wilmington, Delaware and Dover, Delaware markets were determined
separately, using the city of license to determine the split of the
market.
(4) Company audience share rank obtained from Arbitron's Radio Market
Reports, based on average quarter hour estimates for the reporting
period ending Summer 1996, except for Wilmington, Delaware,
Melbourne-Titusville- Cocoa Beach, Florida, Ft. Pierce-Stuart-Vero
Beach, Florida, and Huntington, West Virginia-Ashland, Kentucky, which
are reported as of Spring 1996 because the market was not ranked for
the Summer 1996 period, for the demographic of persons ages 25-54,
listening Monday through Sunday, 6 a.m. to midnight. To account for
listeners lost to other nearby markets, a radio station's "local"
audience share is derived by comparing the radio station's average
quarter hour share to the total average quarter hour share for all
stations whose signals are heard within the MSA, excluding audience
share for listeners who listen to stations whose signals originate
outside the MSA.
16
<PAGE> 17
(5) The Company provides certain sales and marketing services to stations
WKAP-AM in Allentown, Pennsylvania and WPAW-FM in Ft.
Pierce-Stuart-Vero Beach, Florida, pursuant to a JSA. The Company
provides certain sales, programming and marketing services to station
WHRD-AM in Huntington, West Virginia pursuant to an LMA.
(6) Fairfield County and Westchester-Putnam Counties CSA audience share
and revenues obtained from Arbitron's Custom Survey Area Report for
the Spring 1996 period.
(7) A third party has filed a petition for reconsideration with the FCC
requesting reconsideration of the FCC's grant of the application or
transfer of control of this station to the Company. Indian River has
accused the Company of breach of contract and has refused to close the
Indian River Acquisition. The Company does not believe that it has
breached the acquisition agreement and filed a complaint in the
Circuit Court of the Nineteenth Judicial Circuit, Indian River,
Florida to enforce its rights under the acquisition agreement. See
"-- The Acquisitions -- Indian River Acquisition."
(8) Westchester-Putnam Counties, New York are sub-sets of the greater New
York City Metropolitan Area, which is ranked as the largest MSA by
Arbitron and is ranked second in Radio Market Revenues by Duncan's.
17
<PAGE> 18
Southeast Region
Upon consummation of the Osborn Transactions and the Pending
Acquisitions, the Company's portfolio of radio stations in the Southeast Region
will include 52 radio stations (34 FM and 18 AM) located in 15 markets in
Alabama, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee,
Virginia and West Virginia. The Company's stations will comprise the leading
radio station group based on revenue share rank in seven of these markets.
History. Osborn is the core of the Southeast Region with 20 stations
located in the following six markets: Huntsville, Alabama (three stations);
Asheville, North Carolina (two stations); Tuscaloosa, Alabama (three stations);
Wheeling, West Virginia (seven stations); Jackson, Tennessee (three stations);
and Gadsden, Alabama (two stations). Osborn's portfolio of stations and
markets has undergone significant growth during the past two years. Osborn has
completed acquisitions of seven stations in five markets and currently has five
pending station acquisitions in the Huntsville and Tuscaloosa markets.
Management believes that the station clusters in the six markets have not yet
reached the full potential of their recent consolidations.
The Pending Acquisitions will enhance the Company's Southeast Region
station portfolio through the acquisition of 31 additional stations in nine new
markets. The Benchmark Acquisition will provide the Company with 26 stations in
the following new markets: Greenville, South Carolina (four stations);
Columbia, South Carolina (five stations); Roanoke, Virginia (two stations);
Lynchburg, Virginia (one station); Jackson, Mississippi (four stations);
Shreveport, Louisiana (two stations); Montgomery, Alabama (three stations);
Winchester, Virginia (three stations); and Statesville, North Carolina (two
stations). The Cavalier Acquisition will contribute five stations in the
Roanoke and Lynchburg, Virginia markets, further enhancing the Company's market
clusters. The Emerald City Acquisition will contribute an additional station in
the Columbia, South Carolina market. The Company's management believes that the
addition of the southeast Benchmark, Cavalier and Emerald City radio stations
will enhance the Southeast Region's operations by creating a greater critical
mass in the region, and by entering new markets which offer additional
consolidation opportunities.
Management. The chief executive officer of the Southeast Region is
Frank D. Osborn, the President and Chief Executive Officer of Osborn, who
brings to the Company over 19 years of experience in the radio industry,
including prior positions as Senior Vice President of Price Communications,
Vice President of Finance and Administration at NBC Radio and General Manager
of WYNY-FM in New York City. The Company believes that Mr. Osborn's significant
contacts and station owner relationships in the radio industry, particularly in
the southeast, will facilitate the Company's efforts to acquire additional
radio stations in the region. The Company intends to hire a chief operating
officer for the Southeast Region, who will assist Mr. Osborn in overseeing the
operations of the radio stations in the Southeast Region. In addition, each of
the markets in the Southeast Region will be run by a general manager who will
manage the day-to-day operations of the radio stations in each market.
Markets. Management believes that the portfolio of markets in the
Southeast Region has significant consolidation and future add-on acquisition
potential. Management hopes to replicate its success in Wheeling, West
Virginia, where the Company has the number one radio franchise. Osborn
purchased four stations and entered into a JSA with a fifth station in the past
year in order to add to its two existing radio stations. The stations target a
broad demographic spectrum with five different formats: Country; Adult
Contemporary; Adult; Classic Rock; and Oldies. Osborn also operates Capitol
Music Hall and Jamboree in the Hills, a country music festival, which
complement the strong radio station cluster in Wheeling. The Company's stations
comprise the leading radio station group in the Wheeling market based on local
audience share and maintain the number one revenue rank. The Company believes
that Osborn has not yet fully realized the benefits of the economies of scale
or revenue enhancements associated with the recent acquisitions in Wheeling.
The Company seeks to duplicate this strategy in each of its other
southeast markets. For example, upon consummation of the Pending Acquisitions,
the Southeast Region will combine Benchmark's three radio stations in the
Roanoke and Lynchburg, Virginia markets with five Cavalier radio stations
located in those markets. Management believes that the Company's strong
position in these markets will enable its radio clusters to generate
substantial revenue and broadcast cash flow growth.
18
<PAGE> 19
The following table summarizes certain information relating to the
Company's radio stations in the Southeast Region, assuming consummation of the
Pending Acquisitions.
<TABLE>
<CAPTION>
TARGET COMPANY STATION
DEMO- REVENUE AUDIENCE
MARKET AND YEAR SOURCE MSA GRAPHIC SHARE SHARE
STATION CALL LETTERS(1) ACQUIRED COMPANY RANK(2) GROUP RANK(3) RANK(4) FORMAT
- ----------------------- -------- ------- ------- ----- ------- ------- ------
<S> <C> <C> <C> <C> <C<C> <C> <C>
GREENVILLE, SC . . . . . 59 2
WJMZ-FM . . . . . . . . 1990 Benchmark 25-54 3 Urban
WESC-FM . . . . . . . . 1995 Benchmark 25-54 4 Country
WESC-AM . . . . . . . . 1995 Benchmark 25-54 20t Sports
WFNQ-FM . . . . . . . . 1995 Benchmark 25-54 16 Country
COLUMBIA, SC . . . . . . 88 1
WCOS-FM . . . . . . . . 1993 Benchmark 25-54 2 Country
WHKZ-FM . . . . . . . . 1993 Benchmark 25-54 10 Country
WVOC-AM . . . . . . . . 1994 Benchmark 25-54 7t News/Talk
WSCQ-FM . . . . . . . . 1997 Benchmark 25-54 11t Adult
WCOS-AM . . . . . . . . 1993 Benchmark 25-54 13t Country
WNOK-FM . . . . . . . . 1994 Emerald City 25-54 4 Contemporary Hits
HUNTSVILLE, AL . . . . . 114 1
WDRM-FM(5) . . . . . . Pending Osborn 25-54 1 Country
WHOS-AM(5) . . . . . . Pending Osborn 25-54 NA Country
WBHP-AM(5) . . . . . . Pending Osborn 25-54 17t Country
JACKSON, MS . . . . . . . 118 2
WJMI-FM . . . . . . . . 1996 Benchmark 25-54 3 Urban
WOAD-AM . . . . . . . . 1996 Benchmark 25-54 7 Gospel
WKXI-AM . . . . . . . . 1996 Benchmark 25-54 2 Urban
WKXI-FM . . . . . . . . 1996 Benchmark 25-54 14t Urban
SHREVEPORT, LA . . . . . 126 2
KRMD-FM . . . . . . . . 1996 Benchmark 25-54 1 Country
KRMD-AM . . . . . . . . 1996 Benchmark 25-54 13 Country
MONTGOMERY, AL . . . . . 142 2
WZHT-FM(6) . . . . . . Pending Benchmark 25-54 1 Urban
WMCZ-FM(6) . . . . . . Pending Benchmark 25-54 4 Urban/AC
WDHT-FM(6) . . . . . . Pending Benchmark 25-54 NA
ASHEVILLE, NC . . . . . . 179 1
WWNC-AM . . . . . . . . 1994 Osborn 25-54 3 Country
WKSF-FM . . . . . . . . 1994 Osborn 25-54 1 Hot Country
TUSCALOOSA, AL . . . . . 212 1
WACT-AM(5) . . . . . . Pending Osborn 25-54 10t Gospel
WACT-FM(5) . . . . . . Pending Osborn 25-54 9 Country
WTXT-FM . . . . . . . . 1997 Osborn 25-54 1 Country
WHEELING, WV . . . . . . 213 1
WWVA-AM . . . . . . . . 1987 Osborn 25-54 8t Country
WOVK-FM . . . . . . . . 1987 Osborn 25-54 1 Hot Country
WKWK-FM . . . . . . . . 1996 Osborn 25-54 2 Adult Contemporary
WBBD-AM . . . . . . . . 1996 Osborn 25-54 8t Adult
WRIR-FM . . . . . . . . 1996 Osborn 25-54 5 Classic Rock
WEGW-FM . . . . . . . . 1996 Osborn 25-54 4 Classic Rock
WEEL-FM(7) . . . . . . 1996 Osborn 25-54 6t Oldies
WINCHESTER, VA . . . . . 219 NA
WUSQ-FM . . . . . . . . 1991 Benchmark 25-54 1 Country
WFQX-FM . . . . . . . . 1994 Benchmark 18-49 4 Contemporary Hits
Radio
WNTW-AM . . . . . . . . 1994 Benchmark 25-54 NA News/Talk
JACKSON, TN . . . . . . . 257 NA
WTJS-AM . . . . . . . . 1986 Osborn 25-54 8t News/Talk
WTNV-FM . . . . . . . . 1986 Osborn 25-54 3 Country
WYNU-FM . . . . . . . . 1997 Osborn 25-54 1 Classic Rock
ROANOKE, VA . . . . . . . NA 1
WROV-AM . . . . . . . . 1996 Benchmark 25-54 11 Oldies
WROV-FM . . . . . . . . 1996 Benchmark 18-49 2t Album Rock
WRDJ-FM . . . . . . . . 1996 Cavalier 35-64 8 Oldies
WJJS-FM . . . . . . . . 1996 Cavalier 18-34 5 Contemporary Hits
</TABLE>
19
<PAGE> 20
<TABLE>
<CAPTION>
TARGET COMPANY STATION
DEMO- REVENUE AUDIENCE
MARKET AND YEAR SOURCE MSA GRAPHIC SHARE SHARE
STATION CALL LETTERS(1) ACQUIRED COMPANY RANK(2) GROUP RANK(3) RANK(4) FORMAT
- ----------------------- -------- ------- ------- ----- ------- ------- ------
<S> <C> <C> <C> <C> <C> <C> <C>
LYNCHBURG, VA . . . . . . NA 1
WLDJ-FM . . . . . . . . 1996 Cavalier 35-64 4 Oldies
WJJX-FM . . . . . . . . 1996 Cavalier 18-34 2 Contemporary Hits
WJJS-AM . . . . . . . . 1996 Cavalier 18-34 NA Contemporary Hits
WYYD-FM . . . . . . . . 1995 Benchmark 25-54 1 Country
STATESVILLE, NC . . . . . NA NA
WFMX-FM . . . . . . . . 1996 Benchmark 25-54 NA Country
WSIC-AM . . . . . . . . 1996 Benchmark 25-54 NA News/Talk
GADSDEN, AL(8) . . . . . NA NA
WAAX-AM . . . . . . . . 1994 Osborn 25-54 5 News/Talk
WQEN-FM . . . . . . . . 1994 Osborn 25-54 2 Adult Contemporary
</TABLE>
- --------------------------
NA Information not available.
t Tied with another radio station.
(1) Actual city of license may be different from metropolitan market
served. Market may be different from market definition used under FCC
multiple ownership rules.
(2) MSA rank obtained from Arbitron's Summer 1996 Radio Market Survey
Schedule. The table does not include (i) stations to be disposed of in
connection with the Osborn Ft. Myers Disposition, (ii) station WING-FM
in Dayton, Ohio, which station is owned by the Company and for which
an unrelated third party, who has an option to purchase such station,
currently provides certain sales, programming and marketing services
pursuant to an LMA or (iii) station WDRR-FM in Ft. Myers, Florida, in
which the Company owns a 50% nonvoting interest and which the Company
intends to sell. See "-- The Acquisitions."
(3) Company revenue share rank obtained from data in BIA Publications
Radio Analyzer -- BIA's Master Access, version 1.7 (copyright 1996)
(data current of September 4, 1996) based upon 1995 gross revenue for
the indicated markets, on a Company basis.
(4) Company audience share rank obtained from Arbitron's Radio Market
Reports, based on average quarter hour estimates for the reporting
period ending Summer 1996, except for Roanoke and Lynchburg, Virginia,
Huntsville, Alabama, Asheville, North Carolina, Tuscaloosa, Alabama,
Wheeling, West Virginia and, Jackson, Tennessee, which are reported as
of Spring 1996 because the market was not ranked for the Summer 1996
period, for the demographic of persons ages 25-54, listening Monday
through Sunday, 6 a.m. to midnight. To account for listeners lost to
other nearby markets, a radio station's "local" audience share is
derived by comparing the radio station's average quarter hour share to
the total average quarter hour share for all stations whose signals
are heard within the MSA, excluding audience share for listeners who
listen to stations whose signals originate outside the MSA.
(5) The Company has agreed to acquire (i) substantially all of the assets
of stations WACT-FM and WACT-AM in Tuscaloosa, Alabama, and (ii) all
of the issued and outstanding capital stock of the companies that own
WDRM- FM, WBHP-AM and WHOS-AM in Huntsville, Alabama. See "-- The
Acquisitions."
(6) Benchmark has agreed to acquire substantially all of the assets of
stations WZHT-FM, WMCZ-FM and WDHT-FM in Montgomery, Alabama. See "--
The Acquisitions -- Benchmark Montgomery Acquisition."
(7) The Company provides certain sales and marketing services to station
WEEL-FM in Wheeling, West Virginia, pursuant to a JSA.
(8) Audience share rank obtained from Arbitron's June 1996 County Report
(for field work performed in 1995) survey, from the County of Etowah,
Alabama which is Gadsden's home county.
20
<PAGE> 21
West Region
Upon consummation of the Pending Acquisitions, the Company will own
and operate or provide services to 25 radio stations (16 FM and nine AM) in the
West Region. These stations are located in seven markets in Alaska, Arizona,
California, Iowa and Wisconsin. The Company's stations will comprise the
leading radio station group based on local audience share in four of these
markets.
History. The West Region will be formed through the completion of
four of the Pending Acquisitions: COMCO (six stations); Commonwealth (three
stations); Community Pacific (10 stations); and Madison (six stations). Each of
these acquisitions provides the Company with a leading station cluster in at
least one of the markets in the West Region. The acquisition of COMCO provides
the Company with three stations in the Fairbanks, Alaska market. All of the
stations acquired as part of the Commonwealth acquisition are located in Yuma,
Arizona. In Madison, Wisconsin, the Company is ranked number one in revenue and
audience share. In Anchorage, Alaska, the Company will create a newly formed
station cluster with the number one revenue and audience share ranks through
the acquisitions of COMCO and Community Pacific.
Management. The West Region will be managed by two radio executives,
David J. Benjamin and Dex Allen, with an aggregate of 52 years of experience in
the radio broadcasting industry. Mr. Benjamin, the current President and Chief
Executive Officer of Community Pacific, will serve as the chief executive
officer of the West Region upon consummation of the Community Pacific
Acquisition. Mr. Allen has served as the managing member of Commonwealth since
1984 and is expected to continue to serve in such position until the
consummation of the Commonwealth Acquisition. Mr. Allen became the president
and chief operating officer of the West Region effective January 1, 1997. Mr.
Allen has extensive experience operating radio stations in large markets,
having served as both general manager and sales manager at various stations in
San Diego prior to his employment by Commonwealth. Most recently, Mr. Allen has
been a successful owner and operator of radio stations located in mid-sized
markets. The Company expects that the significant operating experience of Mr.
Benjamin and Mr. Allen will serve to improve the results of the stations in the
West Region and also benefit the Company in the pursuit of additional
acquisitions throughout the West Region.
Markets. Although the Company's station clusters in the West Region
have leading positions based on audience share in four of the seven markets,
management believes that substantial opportunity exists to improve the
profitability of these clusters by acquiring additional stations in each of
these markets. For example, in the Des Moines market, the Company operates two
FM and one AM stations. Both FM stations serve the Adult 25-54 demographic, one
of which is programmed as an album oriented rock station and the other as a
country station. The Company intends to pursue acquisitions of additional
stations in the Des Moines market in order to capitalize on its existing
infrastructure and market presence and to enhance the financial performance of
the station cluster. Management intends to pursue such add- on acquisitions in
each of the markets in the West Region.
Management expects to divide the current West Region into additional
geographic regions as more stations are acquired in the midwestern,
southwestern and western United States and as more experienced management
personnel are added to the Company.
21
<PAGE> 22
The following table summarizes certain information relating to the
Company's radio stations in the West Region, assuming the consummation of the
Pending Acquisitions.
<TABLE>
<CAPTION>
TARGET COMPANY STATION
DEMO- REVENUE AUDIENCE
MARKET AND YEAR SOURCE MSA GRAPHIC SHARE SHARE
STATION CALL LETTERS(1) ACQUIRED COMPANY RANK(2) GROUP RANK(3) RANK(4) FORMAT
- ----------------------- -------- ------- ------- ----- ------- ------- ------
<S> <C> <C> <C> <C> <C> <C> <C>
STOCKTON, CA . . . . . . 85 3
KVFX-FM . . . . . . . . 1994 Community Pacific 18-49 4 Classic Rock
KJAX-AM . . . . . . . . 1996 Community Pacific 35-64 6 Talk
DES MOINES, IA . . . . . 89 3
KHKI-FM . . . . . . . . 1995 Community Pacific 25-54 11 Country
KGGO-FM . . . . . . . . 1995 Community Pacific 25-54 1 Album Rock
KDMI-AM . . . . . . . . 1995 Community Pacific NA NA Religion
MADISON, WI . . . . . . . 120 1
WIBA-AM . . . . . . . . 1995 Madison 35-64 8t News/Talk
WIBA-FM . . . . . . . . 1995 Madison 25-54 3 Classic Rock
WMAD-FM . . . . . . . . 1995 Madison 18-34 8t Modern Rock
WTSO-AM . . . . . . . . 1997 Madison 35-64 14 News/Talk
WZEE-FM . . . . . . . . 1997 Madison 18-49 4 Hot Adult
Contemporary
WMLI-FM . . . . . . . . 1997 Madison 35-64 12 Soft Hits
MODESTO, CA . . . . . . . 121 2
KJSN-FM . . . . . . . . 1982 Community Pacific 25-54 2 Soft Adult
Contemporary
KFIV-AM . . . . . . . . 1982 Community Pacific 35-64 12 Talk
ANCHORAGE, AK(5) . . . . 165 1
KBFX-FM . . . . . . . . . 1993 Community Pacific 18-49 7t Classic Rock
KASH-FM . . . . . . . . . 1985 Community Pacific 25-54 2 Country
KENI-AM . . . . . . . . . 1995 Community Pacific 25-54 7t News/Talk
KYAK-AM . . . . . . . . . 1993 COMCO 25-54 NA Adult Contemporary
KGOT-FM . . . . . . . . . 1993 COMCO 25-54 1 Contemporary Hits
Radio
KYMG-FM . . . . . . . . . 1984 COMCO 25-54 6 Adult Contemporary
FAIRBANKS, AK(6) . . . . NA NA
KIAK-FM . . . . . . . . . 1993 COMCO 25-54 1 Country
KIAK-AM . . . . . . . . . 1993 COMCO 25-54 5 News/Talk
KAKQ-FM . . . . . . . . . 1994 COMCO 25-54 8 Adult Contemporary
YUMA, AZ . . . . . . . . NA NA
KYJT-FM . . . . . . . . . 1986 Commonwealth 25-49 1 Classic Hits
KTTI-FM . . . . . . . . . 1995 Commonwealth 25-54 2 Country
KBLU-AM . . . . . . . . . 1995 Commonwealth 35-64 8t Oldies
</TABLE>
NA Information not available.
t Tied with another radio station.
(1) Actual city of license may be different from metropolitan market
served. Market may be different from market definition used under FCC
multiple ownership rules.
(2) MSA rank obtained from Arbitron's Summer 1996 Radio Market Survey
Schedule.
(3) Company revenue share rank obtained from data in BIA Publications
Radio Analyzer -- BIA's Master Access, version 1.7, 1996 (data current
as of September 4, 1996) based upon 1995 gross revenue for the
indicated markets on a company basis.
(4) Company audience share rank obtained from Arbitron's Radio Market
Reports, based on average quarter hour estimates for the reporting
period ending Summer 1996, except for Modesto, California, and
Anchorage, Alaska, which are reported as of Spring 1996 because the
market was not ranked for the Summer 1996 period, for the demographic
of persons ages 25-54, listening Monday through Sunday, 6 a.m. to
midnight, except for the Yuma, Arizona market which was obtained from
AccuRatings(TM). To account for listeners lost to other nearby
markets, a radio station's "local" audience share is derived by
comparing the radio station's average quarter hour share to the total
average quarter hour share for all stations whose signals are heard
within the MSA, excluding audience share for listeners who listen to
stations whose signals originate outside the MSA.
(5) The table does not include station KASH-AM in Anchorage, Alaska. The
Company expects to sell station KASH-AM subsequent to consummation of
the Community Pacific Acquisition in order to remain in compliance
with the station ownership limitations under the Communications Act.
See "--The Acquisitions--COMCO Acquisition."
(6) Fairbanks, Alaska is a CSA as defined by Arbitron. Audience share and
audience share rank obtained from Arbitron's Spring 1996 CSA Market
Report.
22
<PAGE> 23
OTHER BUSINESSES
Broadcast-Related Businesses. The Company (as a result of the Osborn
Acquisition) operates several country music-related entertainment businesses in
Wheeling, West Virginia. The Company enhances and capitalizes on its strong
ratings in country music by integrating its radio stations with its Capitol
Music Hall, a 2,500-seat theater that hosts approximately 100 music, comedy and
dramatic performances each year, and Jamboree in the Hills, an annual outdoor
festival featuring 20 or more country music stars held on a 200-acre site owned
by the Company outside of Wheeling. Jamboree in the Hills won the Country
Music Association's 1991 and 1996 awards for Festival of the Year and was
featured in a one-hour special on The Nashville Network in 1992. The Company
also promotes shows in the 7,500-seat Wheeling Civic Center and has begun
promoting shows in markets outside of Wheeling, West Virginia. The Company
expects to utilize these broadcast-related businesses to provide extensive
marketing and promotional opportunities for its stations in the Northeast and
Southeast Regions, thereby enhancing its strong country music position in these
areas.
Programmed Music. The Company (as a result of the Osborn Acquisition)
also distributes programmed music, primarily Muzak, in the Atlanta, Macon and
Albany, Georgia and Ft. Myers, Florida markets. As the exclusive Muzak
franchisee in these markets, the Company provides subscribers with
commercial-free Muzak programming ranging from traditional background music to
newer formats including country and soft rock. The Company also sells, leases
and installs the equipment required to receive the programming via satellite
and other media. The franchisor, Muzak L.P., provides the programming, and the
Company remits to Muzak a fee based upon the gross revenues from Muzak service.
The Company, and not the franchisor, contracts with individual users of Muzak
programming. Such contracts generally have five-year terms with an automatic
renewal provision. In most cases, the Company owns the equipment at the
customers' sites and charges a lease fee for its use.
As part of its programmed music business, the Company also designs,
sells and installs sound, closed-circuit video and security systems and
equipment in locations such as offices, schools, hospitals, shopping malls and
stadiums. Examples of such systems include shopping mall paging, public
address, closed-circuit video, and fire/security systems. In addition, the
Company is an authorized distributor of the Rauland-Borg line of communications
equipment for schools and hospitals in various markets. The Company expects to
continue to operate programmed music and related businesses acquired in the
Osborn Acquisition.
INDUSTRY OVERVIEW
Radio stations generate the majority of their revenue from the sale
of advertising time to local and national spot advertisers and national network
advertisers. Radio serves primarily as a medium for local advertising. During
the past decade, local advertising revenue as a percentage of total radio
advertising revenue in a given market has ranged from approximately 74% to 78%.
The growth in total radio advertising revenue tends to be fairly stable and has
generally grown at a rate faster than the Gross National Product (the "GNP").
With the exception of 1991, when total radio advertising revenue fell by
approximately 3.1% compared to the prior year, advertising revenue has risen in
each of the past 15 years more rapidly than either inflation or the GNP. Total
advertising revenue in 1995 of $11.5 billion, which represents a 7.6% increase
over 1994, as reported by the Radio Advertising Bureau ("RAB"), was its highest
level in the industry's history.
Radio is considered an efficient means of reaching specifically
identified demographic groups. Stations are typically classified by their
on-air format, such as country, adult contemporary, oldies or news/talk. A
station's format and style of presentation enable it to target certain
demographic and psychographic groups. By capturing a specific listening
audience share of a market's radio audience, with particular concentration in a
targeted demographic group, a station is able to market its broadcasting time
to advertisers seeking to reach a specific audience. Advertisers and stations
utilize data published by audience measuring services, such as Arbitron, to
estimate how many people within particular geographical markets and demographic
groups listen to specific stations.
Stations determine the number of advertisements broadcast hourly that
will maximize available revenue dollars without jeopardizing listening levels.
Although the number of advertisements broadcast during a given time period may
vary, the total number of advertisements broadcast on a particular station
generally does not vary significantly from year to year.
A station's local sales staff generates the majority of its local and
regional advertising sales through direct solicitations of local advertising
agencies and businesses. To generate national advertising sales, a station will
engage a firm that specializes in soliciting radio advertising sales on a
national level. National sales representatives obtain advertising principally
from advertising agencies located outside the station's market and receive
commissions based
23
<PAGE> 24
on the revenue from the advertising obtained. The Company has entered into a
national advertising agreement with Katz Communications, Inc., a national
advertising firm.
According to the RAB's Radio Marketing Guide and Fact Book for
Advertisers, 1993-1994, radio reaches approximately 96% of all Americans over
the age of 12 each week. More than one-half of all radio listening is done
outside the home, in contrast to other advertising mediums, and three out of
four adults are reached by car radio each week. The average listener spends
approximately three hours and 20 minutes per day listening to radio. The
highest portion of radio listenership occurs during the morning, particularly
between the time a listener wakes up and the time the listener reaches work.
This "morning drive time" period reaches more than 85% of people over 12 years
of age and, as a result, radio advertising sold during this period achieves
premium advertising rates. Radio listeners have gradually shifted over the
years from AM (amplitude modulation) to FM (frequency modulation) stations. FM
reception, as compared to AM, is generally clearer and provides greater tonal
range and higher fidelity. FM's listener share is now in excess of 75%, despite
the fact that the number of AM and FM commercial stations in the United States
is approximately equal.
COMPETITION; CHANGES IN BROADCASTING INDUSTRY
The radio broadcasting industry is highly competitive. The success of
each of the Company's stations depends largely upon its audience ratings and
its share of the overall advertising revenue within its market. The Company's
stations compete for listeners and advertising revenue directly with other
radio stations within their respective markets. Radio stations compete for
listeners primarily on the basis of program content that appeals to a
particular demographic group. By building a strong listener base consisting of
a specific demographic group in each of its markets, the Company is able to
attract advertisers seeking to reach those listeners.
Factors that are material to a radio station's competitive position
include management experience, the station's local audience rank in its market,
transmitter power, assigned frequency, audience characteristics, local program
acceptance and the number and characteristics of other radio stations in the
market area. The Company attempts to improve its competitive position with
promotional campaigns aimed at the demographic groups targeted by its stations
and by sales efforts designed to attract advertisers. Recent changes in the
FCC's policies and rules permit increased ownership and operation of multiple
local radio stations. Management believes that radio stations that elect to
take advantage of joint arrangements such as LMAs or JSAs may in certain
circumstances have lower operating costs and may be able to offer advertisers
more attractive rates and services. Although the Company currently operates
several multiple station groups and intends to pursue the creation of
additional multiple station groups, the Company's competitors in certain
markets include operators of multiple stations or operators who already have
entered into LMAs or JSAs.
The radio broadcasting industry is highly competitive, although some
barriers to entry exist. The operation of a radio broadcast station requires a
license from the FCC and the number of radio stations that can operate in a
given market is limited by the availability of FM and AM radio frequencies
allotted by the FCC to communities in that market, as well as by the FCC's
multiple ownership rules that regulate the number of stations that may be owned
and controlled by a single entity. See "-- Federal Regulation of Radio
Broadcasting."
The Company's stations also compete for advertising revenue with
other media, including broadcast television, cable television, newspapers,
magazines, direct mail, coupons and billboard advertising. In addition, the
radio broadcasting industry is subject to competition from new media
technologies that are being developed or introduced, such as the delivery of
audio programming by cable television systems, by satellite and by DAB. DAB may
deliver by satellite to nationwide and regional audiences, multi-channel,
multi-format, digital radio services with sound quality equivalent to compact
discs. The delivery of information through the presently unregulated Internet
also could create a new form of competition. The radio broadcasting industry
historically has grown despite the introduction of new technologies for the
delivery of entertainment and information, such as television broadcasting,
cable television, audio tapes and compact disks. A growing population and
greater availability of radios, particularly car and portable radios, have
contributed to this growth. There can be no assurance, however, that the
development or introduction in the future of any new media technology will not
have an adverse effect on the radio broadcasting industry.
The FCC has allocated spectrum for a new technology, digital audio
radio services ("DARS"), to deliver audio programming. The FCC has proposed,
but not yet adopted, licensing and operating rules for DARS, so that the
allocated spectrum is not yet available for service. The Company cannot predict
when and in what form such rules will be adopted. The FCC granted a waiver in
September 1995 to permit one potential DARS operator to commence construction
of a DARS satellite system, with the express notice that the FCC might not
license such operator to provide DARS, nor would such waiver prejudge the
ongoing rulemaking proceeding. DARS may provide a medium for the delivery by
satellite or
24
<PAGE> 25
terrestrial means of multiple new audio programming formats to local and/or
national audiences. Digital technology also may be used in the future by
terrestrial radio broadcast stations either on existing or alternate
broadcasting frequencies, and the FCC has stated that it will consider making
changes to its rules to permit AM and FM radio stations to offer digital sound
following industry analysis of technical standards. In addition, the FCC has
authorized an additional 100 kHz of bandwidth for the AM band and will soon
allocate frequencies in this new band to certain existing AM station licensees
that applied for migration to the expanded AM band prior to the FCC's cut-off
date. At the end of a transition period, those licensees will be required to
return to the FCC either the license for their existing AM band station or the
license for the expanded AM band station.
The Company cannot predict what other matters might be considered in
the future by the FCC, nor can it assess in advance what impact, if any, the
implementation of any of these proposals or changes might have on its business.
The Company employs a number of on-air personalities and generally
enters into employment agreements with certain of these personalities to
protect its interests in those relationships that it believes to be valuable.
The loss of certain of these personalities could result in a short-term loss of
audience share, but the Company does not believe that any such loss would have
a material adverse effect on the Company.
FEDERAL REGULATION OF RADIO BROADCASTING
The ownership, operation and sale of radio stations are subject to
the jurisdiction of the FCC, which acts under authority granted by the
Communications Act. Among other things, the FCC assigns frequency bands for
broadcasting; determines the particular frequencies, locations and operating
power of stations; issues, renews, revokes and modifies station licenses;
determines whether to approve changes in ownership or control of station
licenses; regulates equipment used by stations; and adopts and implements
regulations and policies that directly affect the ownership, operation and
employment practices of stations. The FCC has the power to impose penalties for
violation of its rules or the Communications Act.
The following is a brief summary of certain provisions of the
Communications Act and of specific FCC regulations and policies. Reference
should be made to the Communications Act, FCC rules and the public notices and
rulings of the FCC for further information concerning the nature and extent of
federal regulation of radio stations.
FCC Licenses. Radio stations operate pursuant to broadcasting
licenses that are ordinarily granted by the FCC for maximum terms of eight
years and are subject to renewal upon application to the FCC. The FCC licenses
for the Company's stations are held by certain of the Company's subsidiaries.
During certain periods when renewal applications are pending, petitions to deny
license renewals can be filed by interested parties, including members of the
public. Historically, the Company's management has not experienced any
material difficulty in renewing any licenses for stations under its control.
The FCC is required to hold hearings on a station's renewal application if a
substantial or material question of fact exists as to whether (i) the station
has served the public interest, convenience and necessity, (ii) there have been
serious violations by the licensee of the Communications Act or the FCC rules
thereunder or (iii) there have been other violations by the licensee of the
Communications Act or the FCC rules thereunder that, taken together, constitute
a pattern of abuse.
The FCC classifies each AM and FM station. An AM station operates on
either a clear channel, regional channel or local channel. A clear channel is
one on which AM stations are assigned to serve wide areas. Clear channel AM
stations are classified as either: Class A stations, which operate unlimited
time and are designated to render primary and secondary service over an
extended area; Class B stations, which operate unlimited time and are designed
to render service only over a primary service area; and Class D stations, which
operate either daytime, limited time or unlimited time with low nighttime
power. A regional channel is one on which Class B and Class D AM stations may
operate and serve primarily a principal center of population and the rural
areas contiguous to it. A local channel is one on which AM stations operate
unlimited time and serve primarily a community and the suburban and rural areas
immediately contiguous thereto. Class C AM stations operate on a local channel
and are designed to render service only over a primary service area that may be
reduced as a consequence of interference.
The minimum and maximum facilities requirements for an FM station are
determined by its class. FM class designations depend upon the geographic zone
in which the transmitter of the FM station is located. In general, commercial
FM stations are classified as follows, in order of increasing power and antenna
height: Class A, B1, C3, B, C2, C1 or C stations.
25
<PAGE> 26
The following table sets forth the market, FCC license
classification, antenna height above average terrain ("HAAT"), power and
frequency of each of the Company's stations (including those with which the
Company has or will have a JSA or LMA), assuming the consummation of the Osborn
Transactions and the Pending Acquisitions, and the date on which each station's
FCC license expires. Each of the Company's AM stations is a regional channel
station other than WSTC-AM, WFAS-AM, WIRO-AM, WBBD-AM, WBHP-AM, WMMB-AM,
KRMD-AM, WSIC-AM, WCOS-AM and WROV-AM, which are local channel stations, and
WINE-AM, WPUT-AM, WKEE-AM, WWVA-AM, WHOS-AM, WESC-AM, KYAK-AM and WTSO-AM,
which are clear channel stations.
<TABLE>
<CAPTION>
HAAT EXPIRATION
FCC IN POWER IN DATE OF
MARKET(1) STATION(2) CLASS FEET KILOWATTS(3) FREQUENCY LICENSE
- --------- ---------- ----- ---- ------------ --------- -------
<S> <C> <C> <C> <C> <C> <C>
NORTHEAST REGION
Allentown-Bethlehem, PA
WAEB-AM B NA 1.0/3.6 790 kHz 08-01-98
WAEB-FM B 499 50.0 104.1 MHz 08-01-98
WZZO-FM B 631 30.0 95.1 MHz 08-01-98
WKAP-AM(4) B NA 5.0 1470 kHz 08-01-98
Melbourne-Titusville-Cocoa, FL
WMMB-AM C NA 1.0 1240 kHz 02-01-04
WGGD-FM A 210 6.0 95.1 MHz 02-01-04
WMYM-AM B NA 1.0 1350 kHz 02-01-04
WLRQ-FM C2 492 50.0 99.3 MHz 02-01-04
WHKR-FM C2 492 50.0 102.7 MHz 02-01-04
Fairfield County, CT
WNLK-AM B NA 1.0/0.5 1350 kHz 04-01-98
WEFX-FM A 300 3.0 95.9 MHz 04-01-98
WSTC-AM C NA 0.8 1400 kHz 04-01-98
WKHL-FM A 828 8.0 96.7 MHz 04-01-98
WINE-AM D NA 0.68/0.004 940 kHz 04-01-98
WRKI-FM B 637 29.5 95.1 MHz 04-01-98
Ft. Pierce-Stuart-Vero Beach, FL
WZZR-FM C2 482 50.0 92.7 MHz 02-01-04
WQOL-FM C2 476 50.0 103.7 MHz 02-01-04
WPAW-FM(4) C2 430 26.0 99.7 MHz *
WBBE-FM C3 295 25.0 94.7 MHz 02-01-04
WAVW-FM A 466 3.1 101.7 MHz 02-01-04
WAXE-AM D NA 1.0/0.07 1370 kHz 02-01-04
WOSN-FM(5) A 328 6.0 97.1 MHz 02-01-04
Huntington, WV-Ashland, KY
WTCR-AM B NA 5.0/0.5 1420 kHz 10-01-03
WTCR-FM B 492 50.0 103.3 MHz 10-01-03
WIRO-AM C NA 1.0 1230 kHz 10-01-04
WHRD-AM(4) D NA 5.0/0.07 1470 kHz 10-01-03
WZZW-AM D NA 5.0/0.026 1600 kHz 10-01-03
WKEE-AM D NA 5.0/0.18 800 kHz 10-01-03
WKEE-FM A 560 53.0 100.5 MHz 10-01-03
WAMX-FM A 1093 0.53 106.3 MHz 10-01-03
WFXN-FM A 125 3.0 107.1 MHz 10-01-04
WBVB-FM A 472 3.0 97.1 MHz 10-01-04
Salisbury-Ocean City, MD
WWFG-FM B 315 50.0 99.9 MHz 10-01-03
WOSC-FM B1 400 16.5 95.9 MHz 08-01-98
Dover, DE
WDSD-FM B 378 50.0 94.7 MHz 08-01-98
WSRV-FM A 377 1.7 92.9 MHz 08-01-98
WDOV-AM B NA 5.0 1410 kHz 08-01-98
Wilmington, DE
WJBR-AM D NA 2.5 1290 kHz 08-01-98
WJBR-FM B 500 50.0 99.5 MHz 08-01-98
</TABLE>
26
<PAGE> 27
<TABLE>
<CAPTION>
HAAT EXPIRATION
FCC IN POWER IN DATE OF
MARKET(1) STATION(2) CLASS FEET KILOWATTS(3) FREQUENCY LICENSE
- --------- ---------- ----- ---- ------------ --------- -------
Westchester-Putnam Counties, NY
<S> <C> <C> <C> <C> <C> <C>
WFAS-AM C NA 1.0 1230 kHz 06-01-98
WPUT-AM D NA 1.0 1510 kHz 06-01-98
WFAS-FM A 669 0.6 103.9 MHz 06-01-98
WZZN-FM A 440 1.4 106.3 MHz 06-01-98
WAXB-FM A 610 0.9 105.5 MHz 06-01-98
SOUTHEAST REGION
Greenville, SC
WJMZ-FM C 1011 100.0 107.3 MHz 12-01-03
WESC-FM C 2001 95.0 92.5 MHz 12-01-03
WESC-AM D NA 50.0/10.0 660 kHz 12-01-03
WFNQ-FM C 2031 87.0 93.3 MHz 12-01-03
Columbia, SC
WCOS-FM C1 981 100.0 97.5 MHz 12-01-03
WHKZ-FM A 443 3.3 96.7 MHz 12-01-03
WVOC-AM B NA 5.0 560 kHz 12-01-03
WSCQ-FM A 328 5.9 100.1 MHz 12-01-03
WCOS-AM C NA 1.0 1400 kHz 12-01-03
WNOK-FM C 1004 100.0 104.7MHz 12-01-03
Huntsville, AL
WDRM-FM C1 981 100.0 102.1 MHz 04-01-04
WHOS-AM D NA 1.0 800 kHz 04-01-04
WBHP-AM C NA 1.0/0.25 1230 kHz 04-01-04
Jackson, MS
WJMI-FM C 1060 98.0 99.7 MHz 06-01-04
WOAD-AM C NA 5.0/1.0 1300 kHz 06-01-04
WKXI-AM B NA 1.0 1400 kHz 06-01-04
WKXI-FM C1 951 98.0 107.5 MHz 06-01-04
Shreveport, LA
KRMD-FM C 1119 1.0 101.1 MHz 06-01-04
KRMD-AM C NA 98.0 1340 kHz 06-01-04
Montgomery, AL
WZHT-FM C 1801 100.0 105.7 MHz 04-01-04
WMCZ-FM A 328 3.0 97.1 MHz 04-01-04
WDHT-FM A 328 3.0 104.3 MHz *
Asheville, NC
WWNC-AM B NA 5.0 570 kHz 12-01-03
WKSF-FM C 2622 48.0 99.9 MHz 12-01-03
Tuscaloosa, AL
WACT-AM D NA 5.0 1420 kHz 04-01-04
WACT-FM A 299 6.0 105.5 MHz 04-01-04
WTXT-FM C1 906 100.0 98.1 MHz 04-01-04
Wheeling, WV
WWVA-AM A NA 50.0 1170 kHz 10-01-03
WOVK-FM B 889 50.0 98.7 MHz 10-01-03
WKWK-FM B 420 50.0 97.3 MHz 10-01-03
WBBD-AM D NA 1.0 1400 kHz 10-01-03
WRIR-FM B1 312 13.5 105.5 MHz 10-01-03
WEGW-FM B 883 10.5 107.5 MHz 10-01-03
WEEL-FM(4) A 627 1.7 95.7 MHz 10-01-04
Winchester, VA
WUSQ-FM B 630 32.0 102.5 MHz 10-01-03
WFQX-FM A 269 3.0 99.3 MHz 10-01-03
WNTW-AM B NA 0.5 610 kHz 10-01-03
</TABLE>
27
<PAGE> 28
<TABLE>
<CAPTION>
HAAT EXPIRATION
FCC IN POWER IN DATE OF
MARKET(1) STATION(2) CLASS FEET KILOWATTS(3) FREQUENCY LICENSE
- --------- ---------- ----- ---- ------------ --------- -------
<S> <C> <C> <C> <C> <C> <C>
Jackson, TN
WTJS-AM B NA 5.0;1.0 1390 kHz 08-01-04
WTNV-FM C1 679 100.0 104.1 MHz 08-01-04
WYNU-FM C 991 100.0 92.3 MHz 08-01-04
Roanoke, VA
WROV-AM C NA 1.0 1240 kHz 10-01-03
WROV-FM C1 2077 14.8 96.3 MHz 10-01-03
WRDJ-FM C3 925 3.1 104.9 MHz *
WJJS-FM A 92 5.8 106.1 MHz 10-01-03
Lynchburg, VA
WLDJ-FM B 745 22.0 102.7 MHz 10-01-03
WJJX-FM A 288 3.4 101.7 MHz 10-01-03
WJJS-AM B NA 1.0/0.02 1320 kHz 10-01-03
WYYD-FM C1 1768 20.5 107.9 MHz 10-01-03
Statesville, NC
WFMX-FM C 1516 100.0 105.7 MHz 12-01-03
WSIC-AM C NA 1.0 1400 kHz 12-01-03
Gadsden, AL
WAAX-AM B NA 5.0/540 Watts 570 kHz 04-01-04
WQEN-FM C 1079 97.0 103.7 MHz 04-01-04
WEST REGION
Stockton, CA
KVFX-FM (4) A 328 3.0 96.7 MHz 12-01-97
KJAX-AM (4) B NA 1.0 1280 kHz 12-01-97
Des Moines, IA
KHKI-FM (4) C1 449 115.0 97.3 MHz 02-01-05
KGGO-FM (4) C 1066 100.0 94.9 MHz 02-01-05
KDMI-AM (4) B NA 5.0 1460 kHz 02-01-05
Madison, WI
WIBA-AM B NA 5.0 1310 kHz 12-01-04
WIBA-FM B 1013 12.0 101.5 MHz 12-01-04
WMAD-FM A 400 1.75 92.1 MHz 12-01-04
WTSO-AM B NA 10.0;5.0 1070 kHz 12-01-04
WZEE-FM B 1119 9.4 104.1 MHz 12-01-04
WMLI-FM B1 673 5.1 96.3 MHz 12-01-04
Modesto, CA
KJSN-FM (4) A 299 6.0 102.3 MHz 12-01-97
KFIV-AM (4) B NA 4.0/0.95 1360 kHz 12-01-97
Anchorage, AK
KBFX-FM (4) C3 175 25.0 100.5 MHz 02-01-98
KENI-AM (4) B NA 5.0 550 kHz 02-01-98
KYAK-AM A NA 50.0 650 kHz 02-01-98
KGOT-FM C2 (66) 26.0 101.3 MHz 02-01-98
KYMG-FM C1 499 100.0 98.9 MHz 02-01-98
KASH-FM (4) C1 (289) 100.0 107.5 MHz 02-01-98
Fairbanks, AK
KIAK-FM C 1620 55.0 102.5 MHz 02-01-98
KIAK-AM B NA 5.0 970 kHz 02-01-98
KAKQ-FM C2 370 25.0 101.1 MHz 02-01-98
Yuma, AZ
KYJT-FM A 262 3.0 100.9 MHz 10-01-97
KTTI-FM C 175 25.0 95.1 MHz 10-01-97
KBLU-AM B NA 1.0 560 kHz 10-01-97
</TABLE>
- -------------------------
* Not licensed -- Construction Permit only.
(1) Actual city of license may be different from metropolitan market
served. Market may be different from market definition used under FCC
multiple ownership rules.
(2) The table does not include (i) stations to be disposed of in
connection with the Osborn Ft. Myers Disposition, (ii) station WING-FM
in Dayton, Ohio, which is owned by the Company and for which an
unrelated third party, who has an option to purchase such station,
currently
28
<PAGE> 29
provides certain sales, programming and marketing services pursuant to
an LMA, (iii) station WDRR-FM in Ft. Myers, Florida, in which the
Company owns a 50% nonvoting interest and which the Company intends to
sell or (iv) station KASH-AM in Anchorage, Alaska, which the Company
will own upon consummation of the Community Pacific Acquisition, but
expects to sell subsequent thereto to remain in compliance with the
station ownership limitations under the Communications Act. See "--
The Acquisitions."
(3) Pursuant to FCC rules and regulations, many AM radio stations are
licensed to operate at a reduced power during nighttime broadcasting
hours, which generally results in reducing the radio station's
coverage area during those hours of operation. Both power ratings are
shown, where applicable.
(4) The Company provides certain sales and marketing services to stations
WKAP-AM in Allentown, Pennsylvania, WPAW- FM in Ft. Pierce-Stuart-Vero
Beach, Florida and WEEL-FM in Wheeling, West Virginia, pursuant to a
JSA. The Company provides certain sales, programming and marketing
services to station WHRD-AM in Huntington, West Virginia, and pending
consummation of the Community Pacific Acquisition, to stations KFIV-AM
and KJSN-FM in Modesto, California, KVFX-FM and KJAX-FM in Stockton,
California, KASH-FM, KENI-AM and KBFX in Anchorage, Alaska, and
KDMI-AM, KHKI-FM and KGGO-FM in Des Moines, Iowa, pursuant to an LMA.
(5) A third party filed a petition for reconsideration with the FCC
requesting reconsideration of the FCC's grant of the application for
transfer of control of this station to the Company. In addition, the
FCC has granted an application to upgrade this station from a Class A
to a Class C-3 station, and the FCC has written a letter to the
Company requesting it to demonstrate that its acquisition of the
station, when modified, will comply with the FCC's multiple ownership
rules. Indian River had accused the Company of breach of contract and
has refused to close the Indian River Acquisition. The Company does
not believe that it has breached the acquisition agreement and has
filed a complaint against Indian River in the Circuit Court of the
Nineteenth Judicial Circuit, Indian River, Florida to enforce its
rights under the acquisition agreement. See "-- The Acquisitions --
Indian River Acquisition."
Ownership Matters. The Communications Act prohibits the assignment of
a broadcast license or the transfer of control of a broadcast licensee without
the prior approval of the FCC. In determining whether to grant such approval or
to grant or renew a broadcast license, the FCC considers a number of factors
pertaining to the licensee, including compliance with the various rules
limiting common ownership of media properties, the "character" of the licensee
and those persons holding "attributable" interests therein, and compliance with
the Communications Act's limitations on alien ownership as well as compliance
with other FCC policies, including FCC equal employment opportunity
requirements. Historically, FCC licenses have generally been renewed. The
Company has no reason to believe that its licenses will not be renewed in the
ordinary course, although there can be no assurance to that effect. The
non-renewal of one or more of the Company's licenses could have a material
adverse effect on the Company.
To obtain the FCC's prior consent to assign or transfer control of a
broadcast license, appropriate applications must be filed with the FCC. If the
application involves a "substantial change" in ownership or control, the
application must be placed on public notice for a period of approximately 30
days during which petitions to deny the application may be filed by interested
parties, including members of the public. If the application does not involve a
"substantial change" in ownership or control, it is a "pro forma" application.
The "pro forma" application is nevertheless subject to having informal
objections filed against it. If the FCC grants an assignment or transfer
application, interested parties have approximately 30 days from public notice
of the grant to seek reconsideration of that grant. Generally, parties that do
not file initial petitions to deny or informal objections against the
application face a high hurdle in seeking reconsideration of the grant. The FCC
normally has approximately an additional ten days to set aside such grant on
its own motion. When passing on an assignment or transfer application, the FCC
is prohibited from considering whether the public interest might be served by
an assignment or transfer of the broadcast license to any party other than the
assignee or transferee specified in the application.
In response to the Telecom Act, the FCC amended its multiple ownership
rules to eliminate the national limits on ownership of AM and FM stations.
Additionally, it established new local ownership rules that use a sliding scale
of permissible ownership, depending on market size. In radio markets with 45 or
more commercial radio stations, a licensee may own up to eight stations, no
more than five of which can be in a single radio service (i.e., no more than
five AM or five FM). In radio markets with 30 to 44 commercial radio stations,
a licensee may own up to seven stations, no more than four of which can be in a
single radio service. In radio markets having 15 to 29 commercial radio
stations, a licensee may own up to six radio stations, no more than four of
which can be in a single radio service. Finally, with respect to radio markets
having 14 or fewer commercial radio stations, a licensee may own up to five
radio stations, no more than three of which can be in the same service;
provided that the licensee may not own more than one half of the radio stations
in the market. FCC ownership rules continue to permit an entity to own one FM
and one AM station in a local market regardless of market size.
The Communications Act and FCC rules also prohibit the common
ownership, operation or control of a radio broadcast station and a television
broadcast station serving the same geographic market (subject to a waiver of
such prohibition if certain conditions are satisfied) and of a radio broadcast
station and a daily newspaper serving the same geographic market. Under these
rules, absent waivers, the Company would not be permitted to acquire any daily
newspaper or television broadcast station (other than low-power television) in
any geographic market in which it now owns radio broadcast properties. On
October 1, 1996, the FCC commenced a proceeding to explore possible revisions
of its policies concerning waiver of the newspaper/radio cross-ownership
restrictions.
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The FCC generally applies its ownership limits to "attributable"
interests held by an individual, corporation, partnership or other association.
In the case of corporations holding, or through subsidiaries controlling,
broadcast licenses, the interest of officers, directors and those who, directly
or indirectly, have the right to vote 5% or more of the corporation's voting
stock (or 10% or more of such stock in the case of insurance companies,
investment companies and bank trust departments that are passive investors) are
generally attributable.
R. Steven Hicks, the Company's Chief Executive Officer and Chairman of
the Board, is the Chairman, Chief Executive Officer and a director of GulfStar
Communications, Inc. ("GulfStar"), which is the licensee through its
subsidiaries of radio stations in various markets throughout the States of
Texas, Louisiana and Arkansas and is seeking to acquire additional radio
stations in the States of Texas, Arkansas and New Mexico. Thomas O. Hicks, a
director of the Company, is a director of GulfStar and President and a director
of HM2/Chancellor Holdings, Inc., which through its subsidiaries holds
attributable interests in radio stations in various markets in the States of
California, Florida, Minnesota, New York, Ohio, Kentucky, Arizona, Colorado,
Georgia, Maryland, Pennsylvania, New Jersey, and Wisconsin and Washington, D.C.
and is seeking to acquire an interest in stations in Illinois and Michigan.
Thomas O. Hicks is also the President, Chief Executive Officer and Chief
Operating Officer and 100% stockholder of HM3/Sunrise, Inc., which through its
subsidiaries owns television stations in California, New York and Michigan and
is seeking to acquire an attributable interest in a television station in Ohio.
Eric C. Neuman, a Vice President and Assistant Secretary and a director of the
Company, is a Vice President of GulfStar, a Vice President and Secretary of
HM2/Chancellor Holdings, Inc., and a Vice President of HM3/Sunrise, Inc.
In determining whether the Company is in compliance with the local
ownership limits on AM and FM stations, the FCC will consider the Company's AM
and FM holdings in combination with the attributable broadcast interests of the
Company's officers and directors. Accordingly, the attributable broadcast
interests of the Company's officers and directors described in the preceding
paragraph will limit the number of radio stations the Company may acquire or
own in any market in which such officers or directors hold or acquire
attributable broadcast interests. In addition, the Company's officers and
directors may from time to time hold various nonattributable interests in media
properties.
Under its "cross-interest" policy, the FCC considers certain
"meaningful" relationships among competing media outlets in the same market,
even if the ownership rules do not specifically prohibit the relationship.
Under the cross- interest policy, the FCC in certain instances may prohibit one
party from acquiring an attributable interest in one media outlet and a
substantial non-attributable economic interest in another media outlet in the
same market. Under this policy, the FCC may consider significant equity
interests combined with an attributable interest in a media outlet in the same
market, joint ventures, and common key employees among competitors. The
cross-interest policy does not necessarily prohibit all of these interests, but
requires that the FCC consider whether, in a particular market, the
"meaningful" relationships between competitors could have a significant adverse
effect upon economic competition and program diversity. Heretofore, the FCC has
not applied its cross-interest policy to LMAs and JSAs between broadcast
stations. In its ongoing rulemaking proceeding concerning the attribution
rules, the FCC has sought comment on, among other things, (i) whether the
cross-interest policy should be applied only in smaller markets and (ii)
whether non- equity financial relationships such as debt, when combined with
multiple business interrelationships such as LMAs and JSAs, raise concerns
under the cross-interest policy.
The Communications Act prohibits the issuance of broadcast licenses
to, or the holding of broadcast licenses by, any corporation of which more than
20% of the capital stock is owned of record or voted by non-U.S. citizens or
their representatives or by a foreign government or a representative thereof,
or by any corporation organized under the laws of a foreign country
(collectively, "Aliens"). The Communications Act also authorizes the FCC, if
the FCC determines that it would be in the public interest, to prohibit the
issuance of a broadcast license to, or the holding of a broadcast license by,
any corporation directly or indirectly controlled by any other corporation of
which more than 25% of the capital stock is owned of record or voted by Aliens.
The Company has been advised that the FCC staff has interpreted this provision
to require a public interest finding in favor of such a grant or holding before
a broadcast license may be granted to or held by any such corporation and have
made such a finding only in limited circumstances. The FCC has issued
interpretations of existing law under which these restrictions in modified form
apply to other forms of business organizations, including partnerships. As a
result of these provisions, the licenses granted to the radio station
subsidiaries of the Company by the FCC could be revoked if, among other
restrictions imposed by the FCC, more than 25% of the Company's capital stock
were directly or indirectly owned or voted by Aliens.
Local Marketing Agreements. Over the past few years, a number of
radio stations have entered into what have commonly been referred to as local
marketing agreements or LMAs. While these agreements may take varying forms,
under a typical LMA, separately owned and licensed radio stations agree to
enter into cooperative arrangements of varying sorts, subject to compliance
with the requirements of antitrust laws and with the FCC's rules and policies.
Under
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these arrangements, separately-owned stations could agree to function
cooperatively in programming, advertising sales and similar matters, subject to
the requirement that the licensee of each station maintain independent control
over the programming and operations of its own station. One typical type of LMA
is a programming agreement between two separately-owned radio stations serving
a common service area, whereby the licensee of one station programs substantial
portions of the broadcast day on the other licensee's station, subject to
ultimate editorial and other controls being exercised by the latter licensee,
and sells advertising time during those program segments. Such arrangements are
an extension of the concept of "time brokerage" agreements, under which a
licensee of a station sells blocks of time on its station to an entity or
entities that program the blocks of time and sell their own commercial
advertising announcements during the time periods in question.
The FCC has specifically revised its "cross-interest" policy to make
that policy inapplicable to time brokerage arrangements. Furthermore, the staff
of the FCC's Mass Media Bureau has held that LMAs are not contrary to the
Communications Act provided that the licensee of the station that is being
substantially programmed by another entity maintains complete responsibility
for, and control over, programming and operations of its broadcast station and
assures compliance with applicable FCC rules and policies.
The FCC's multiple ownership rules specifically permit radio station
LMAs to continue to be entered into and implemented, but provide that a station
brokering more than 15% of the weekly broadcast time on another station serving
the same market will be considered to have an attributable ownership interest
in the brokered station for purposes of the FCC's multiple ownership rules. As
a result, the Company would not be permitted to enter into an LMA with another
local radio station that it could not own under the revised local ownership
rules, unless the Company's programming constituted 15% or less of the other
local station's programming time on a weekly basis. The FCC rules also prohibit
a broadcast licensee from simulcasting more than 25% of its programming on
another station in the same broadcast service (i.e., AM-AM or FM-FM) through a
time brokerage or LMA arrangement where the brokered and brokering stations
which it owns or programs serve substantially the same area. Such 25%
simulcasting limitation also applies to commonly owned stations in the same
broadcast service that serve substantially the same area.
Joint Sales Agreements. Over the past few years, a number of radio
stations have entered into cooperative arrangements commonly known as joint
sales agreements or JSAs. While these agreements may take varying forms, under
the typical JSA, a station licensee obtains, for a fee, the right to sell
substantially all of the commercial advertising on a separately-owned and
licensed station in the same market. The typical JSA also customarily involves
the provision by the selling licensee of certain sales, accounting and "back
office" services to the station whose advertising is being sold. The typical
JSA is distinct from an LMA in that a JSA normally does not involve
programming.
The FCC has determined that issues of joint advertising sales should
be left to enforcement by antitrust authorities, and therefore does not
generally regulate joint sales practices between stations. Currently, stations
for which a licensee sells time under a JSA are not deemed by the FCC to be
attributable interests of that licensee. However, in connection with its
ongoing rulemaking proceeding concerning the attribution rules, the FCC is
considering whether JSAs should be considered attributable interests or within
the scope of the FCC's cross-interest policy, particularly when JSAs contain
provisions for the supply of programming services and/or other elements
typically associated with LMAs. If JSAs become attributable interests as a
result of changes in the FCC rules, the Company may be required to terminate
any JSA it might have with a radio station which the Company could not own
under the FCC's multiple ownership rules.
Programming and Operation. The Communications Act requires
broadcasters to serve the "public interest." The FCC gradually has relaxed or
eliminated many of the more formalized procedures it had developed in the past
to promote the broadcast of certain types of programming responsive to the
needs of a station's community of license. A licensee continues to be required,
however, to present programming that is responsive to issues of the station's
community and to maintain certain records demonstrating such responsiveness.
Complaints from listeners concerning a station's programming often will be
considered by the FCC when it evaluates renewal applications of a licensee,
although listener complaints may be filed at any time and generally may be
considered by the FCC at any time. Stations also must pay regulatory and
application fees and follow various rules promulgated under the Communications
Act that regulate, among other things, political advertising, sponsorship
identifications, the advertisement of contests and lotteries, obscene and
indecent broadcasts, and technical operations, including limits on radio
frequency radiation. In addition, licensees must develop and implement
affirmative action programs designed to promote equal employment opportunities
and must submit reports to the FCC with respect to these matters on an annual
basis and in connection with a renewal application.
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Failure to observe these or other rules and policies can result in the
imposition of various sanctions, including monetary forfeitures, the grant of
"short term" (less than the full term) license renewal or, for particularly
egregious violations, the denial of a license renewal application or the
revocation of a license.
Proposed and Recent Changes. The FCC has a pending rulemaking
proceeding that seeks, among other things, comment on whether the FCC should
modify its radio and television broadcast ownership "attribution" rules by (i)
raising the basic benchmark for attributing ownership in a corporate licensee
from 5% to 10% of the licensee's outstanding voting power, (ii) increasing from
10% to 20% of the licensee's outstanding voting power the attribution benchmark
for "passive investors" in corporate licensees, (iii) attributing certain
minority stockholdings in corporations with a single majority shareholder and
(iv) attributing certain debt or non-voting stock interests that have
heretofore been non-attributable.
Moreover, Congress and the FCC have under consideration, and in the
future may consider and adopt, new laws, regulations and policies regarding a
wide variety of matters that could affect, directly or indirectly, the
operation, ownership and profitability of the Company's radio stations, result
in the loss of audience share and advertising revenues for the Company's radio
stations, and affect the ability of the Company to acquire additional radio
stations or to finance those acquisitions. Such matters may include spectrum
use or other fees on FCC licenses; revisions to the FCC's equal employment
opportunity rules and rules relating to political broadcasting; technical and
frequency allocation matters; proposals to restrict or prohibit the advertising
of beer, wine and other alcoholic beverages on radio; changes in the FCC's
cross-interest, multiple ownership and cross-ownership policies; new
technologies such as DAB; and proposals to auction the right to use the radio
broadcast spectrum to the highest bidder, instead of granting FCC licenses and
subsequent license renewals.
The Company is also aware that on November 7, 1996, the FCC issued a
Further Notice of Proposed Rulemaking, which, among other things, reviews the
FCC's regulations governing the attribution of broadcast interests, including
LMAs, JSAs and non-voting stock and debt. At this time, no determination can be
made as to what effect, if any, this proposed rulemaking will have on the
Company.
The Company cannot predict what other matters might be considered in
the future by the FCC or Congress, nor can it judge in advance what impact, if
any, the implementation of any of these proposals or changes might have on its
business.
Federal Antitrust Laws. In addition to the risks associated with the
acquisition of radio stations, the Company is also aware of the possibility
that certain acquisitions it proposes to make may be investigated by the FTC or
the DOJ, which are the agencies responsible for enforcing the federal antitrust
laws. The agencies have recently investigated several radio station
acquisitions where an operator proposed to acquire new stations in its existing
markets. Any decision by the FTC or the DOJ to challenge a proposed acquisition
could affect the ability of the Company to consummate the acquisition or to
consummate it on the proposed terms.
For an acquisition meeting certain size thresholds, the HSR Act and
the rules promulgated thereunder require the parties to file Notification and
Report Forms with the FTC and the DOJ and to observe specified waiting period
requirements before consummating the acquisition. During the initial 30 day
period after the filing, the agencies decide which of them will investigate the
transaction. If the investigating agency determines that the transaction does
not raise significant antitrust issues, then it will either terminate the
waiting period or allow it to expire after the initial 30 days. On the other
hand, if the agency determines that the transaction requires a more detailed
investigation, then at the conclusion of the initial 30 day period, it will
issue a formal request for additional information ("Second Request"). The
issuance of a Second Request extends the waiting period until the twentieth
calendar day after the date of substantial compliance by all parties to the
acquisition. Thereafter, such waiting period may only be extended by court
order or with the consent of the parties. In practice, complying with a Second
Request can take a significant amount of time. In addition, if the
investigating agency raises substantive issues in connection with a proposed
transaction, then the parties frequently engage in lengthy discussions or
negotiations with the investigating agency concerning possible means of
addressing those issues, including but not limited to persuading the agency
that the proposed acquisition would not violate the antitrust laws,
restructuring the proposed acquisition, divestiture of other assets of one or
more parties, or abandonment of the transaction. Such discussions and
negotiations can be time- consuming, and the parties may agree to delay
consummation of the acquisition during their pendency.
At any time before or after the consummation of a proposed
acquisition, the FTC or the DOJ could take such action under the antitrust laws
as it deems necessary or desirable in the public interest, including seeking to
enjoin the acquisition or seeking divestiture of the business acquired or other
assets of the Company. Acquisitions that are not
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required to be reported under the HSR Act may be investigated by the FTC or the
DOJ under the antitrust laws before or after consummation. In addition, private
parties may under certain circumstances bring legal action to challenge an
acquisition under the antitrust laws.
Capstar and Benchmark each filed with the DOJ and the FTC a
Notification and Report Form with respect to the Benchmark Acquisition on
January 17, 1997. On February 14, 1997, Capstar received a Second Request for
information from the DOJ relating to the Benchmark Acquisition, which focuses
particularly on the Benchmark radio stations in the Dover and Wilmington,
Delaware areas. The applicable waiting period under the HSR Act for the
Benchmark Acquisition will expire 20 calendar days after both Capstar and
Benchmark substantially comply with the Second Request, unless the parties
agree to extend the waiting period or the DOJ seeks to, and is successful in
its efforts to, enjoin the Benchmark Acquisition. Capstar and Benchmark are in
the process of complying with the Second Request. Although the Company believes
that the Benchmark Acquisition ultimately will be consummated, there can be no
assurance that the DOJ will clear the Benchmark Acquisition in its current form
or that the Company or Benchmark will not be required to dispose of certain
radio stations or take other measures in order to consummate the Benchmark
Acquisition. The Company does not believe that any of the other Pending
Acquisitions will be adversely affected in any material respect by review under
the HSR Act.
Pacific Star and Community Pacific each filed with the DOJ and the FTC
a Notification and Report Form with respect to the Community Pacific
Acquisition on January 28, 1997 and received early termination of the
applicable waiting period under the HSR Act on February 21, 1997. Madison
Acquisition Co. and Madison filed with the DOJ and the FTC a Notification and
Report Form with respect to the Madison Acquisition in February 1997 and
received early termination of the applicable waiting period under the HSR Act
on March 11, 1997. None of the other Pending Acquisitions are subject to the
HSR Act.
As part of its increased scrutiny of radio station acquisitions, the
DOJ has stated publicly that it believes that LMAs, JSAs and other similar
agreements customarily entered into in connection with radio station transfers
prior to the expiration of the waiting period under the HSR Act could violate
the HSR Act. Since then, the DOJ has stated publicly that it will apply its new
policy prohibiting LMAs in connection with purchase agreements until the
expiration or termination of the HSR waiting period prospectively only.
EMPLOYEES
At December 31, 1996, the Company had a staff of 295 full-time
employees and 130 part-time employees. If the Osborn Transactions had been
consummated as of December 31, 1996, the Company would have had a staff of
approximately 626 full-time employees and 265 part-time employees as of such
date. There are no collective bargaining agreements between the Company and its
employees. The Company does have, however, one union employee employed in
connection with its Muzak franchise in Atlanta, Georgia, and is negotiating a
collective bargaining agreement with the American Federation of Television and
Radio Artists of America ("AFTRA") which represents the on-air performance
staff of WFAS- AM/FM in Westchester County, New York for collective bargaining
purposes. WFAS-AM/FM has approximately nine employees that would be represented
by AFTRA. The Company believes that its relations with its employees are good.
SEASONALITY
Seasonal revenue fluctuations are common in the radio broadcasting
industry and are due primarily to fluctuations in advertising expenditures by
retailers. The Company's revenues and broadcast cash flows are typically lowest
in the first quarter and highest in the second and fourth quarters.
RISKS ASSOCIATED WITH BUSINESS ACTIVITIES
The nature of the business activities conducted by the Company
subjects the Company, its sole stockholder and the holders of the Company's
indebtedness to certain risks. The following is a summary of some of the
material risks relating to the Company's business activities.
Substantial Leverage. The Company has, and after giving effect to the
Osborn Transactions, the Pending Acquisitions and the financing thereof and the
application of the net proceeds therefrom, will continue to have, consolidated
indebtedness that is substantial in relation to its stockholders' equity. The
Indenture dated as of April 21, 1995, as amended, among the Company and IBJ
Schroder Bank & Trust Company, governing the Company's 13 1/4% Senior
Subordinated Notes due 2003 (the "Indenture"), Capstar's Indenture dated as of
February 20, 1997, between
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Capstar and U.S. Trust Company of Texas, N.A., governing Capstar's 12 3/4%
Senior Discount Notes due 2009 (the "Capstar Indenture"), and the Credit
Agreement dated as of February 20, 1997, among Capstar, the Company, as
borrower, various banks and Bankers Trust Company (the "New Credit Facility")
limit the incurrence of additional indebtedness by the Company and its
subsidiaries in each case, subject to certain significant exceptions. At
December 31, 1996, on a pro forma basis after giving effect to the Osborn
Transactions, the Company would have had outstanding, on a consolidated basis,
long-term indebtedness (including current portions) of approximately $69.8
million and stockholders' equity of approximately $151.2 million.
The level of the Company's indebtedness could have several important
consequences, including, but not limited to, the following: (i) a substantial
portion of the Company's cash flow from operations will be dedicated to debt
service and will not be available for other purposes; (ii) the Company's
ability to obtain additional financing for working capital, capital
expenditures, acquisitions, and general corporate or other purposes may be
impaired in the future; (iii) certain of the Company's borrowings will be at
variable rates of interest (including any borrowings under the New Credit
Facility), which will expose the Company to the risk of increased interest
rates; (iv) the Company's leveraged position and the covenants contained in the
New Credit Facility, the Capstar Indenture and the Indenture could limit the
Company's ability to compete, expand and make capital improvements; and (v) the
Company's level of indebtedness could make it more vulnerable to economic
downturns, limit its ability to withstand competitive pressures and reduce its
flexibility in responding to changing business and economic conditions.
The Company's ability to satisfy its debt obligations will depend upon
its future financial and operating performance, which, in turn, is subject to
prevailing economic conditions and financial, business and other factors,
certain of which are beyond its control. If the Company's cash flow and capital
resources are insufficient to fund its debt service obligations, the Company
may be forced to reduce or delay planned expansion and capital expenditures,
sell assets, obtain additional equity capital or restructure its debt. There
can be no assurance that the Company's operating results, cash flow and capital
resources will be sufficient for payment of its debt service and other
obligations in the future. In the absence of such operating results and
resources, the Company could face substantial liquidity problems and might be
required to sell material assets or operations to meet its debt service and
other obligations, and there can be no assurance as to the timing of such sales
or the proceeds that the Company could realize therefrom or that such sales can
be effected on terms satisfactory to the Company or at all. See "Item 7.
Management's Discussion and Analysis of Results of Operations and Financial
Condition -- Liquidity and Capital Resources."
Holding Company Structure; Limitations on Access to Cash Flow of the
Company's Subsidiaries. The Company conducts its business through its
subsidiaries and has no operations of its own. The sole operating assets of the
Company are all of the shares of capital stock of CHI and Osborn, which in
turn, directly or indirectly, own the capital stock of the Company's other
subsidiaries. Consequently, the Company's sole source of cash from which to
satisfy its debt service and other obligations are dividends distributed or
other payments made to it by CHI and Osborn, and CHI's and Osborn's sole source
of cash are dividends distributed or payments made to it by such other
subsidiaries. Except as permitted under the Indenture and the New Credit
Facility, the Company's subsidiaries may not incur additional indebtedness.
Furthermore, CHI, Osborn and such other subsidiaries are legally distinct from
the Company and, except for the guarantees by such entities discussed below,
have no obligation, contingent or otherwise, to make any funds available to
satisfy the Company's debt service or other obligations. The ability of the
Company's subsidiaries to make such funds available, whether through dividends
or other distributions, is subject to applicable corporate and other laws and
regulations and to the terms of agreements to which such subsidiaries are or
become subject. All of the Company's subsidiaries are guarantors of the 13
1/4% Senior Subordinated Notes due 2003 (the "Notes") issued under the
Indenture and are guarantors under the New Credit Facility. Such subsidiaries
also granted security interests in substantially all of their assets in which a
security interest may lawfully be granted to secure their indebtedness under
the New Credit Facility. See "Item 7. Management's Discussion and Analysis of
Results of Operations and Financial Condition -- Liquidity and Capital
Resources."
Restrictions Imposed by Terms of Indebtedness. The New Credit
Facility, the Indenture and the Capstar Indenture contain certain covenants
that restrict, among other things, the ability of the Company and its
subsidiaries to incur additional indebtedness, incur liens, pay dividends or
make certain other restricted payments, consummate certain asset sales, enter
into certain transactions with affiliates, merge or consolidate with any other
person or sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of the assets of the Company. The New Credit Facility also
requires Capstar and, as a result, the Company to maintain specified financial
ratios and to satisfy certain financial condition tests. Capstar's ability to
meet those financial ratios and financial condition tests can be affected by
events beyond the Company's and Capstar's control, and there can be no
assurance that Capstar will meet those tests. A breach of any of these
covenants could result in a default under the New Credit Facility or the
Indenture. In the event of an event of default under the New Credit Facility
or the Indenture, the lenders thereunder could elect to declare all
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amounts outstanding thereunder, together with accrued interest, to be
immediately due and payable. In the case of the New Credit Facility, if the
Company were unable to repay those amounts, the lenders thereunder could
proceed against the collateral granted to them to secure that indebtedness. If
the New Credit Facility indebtedness were to be accelerated, there can be no
assurance that the assets of the Company would be sufficient to repay in full
such indebtedness and the other indebtedness of the Company. See "Item 7.
Management's Discussion and Analysis of Results of Operations and Financial
Condition -- Liquidity and Capital Resources."
Management of Growth. The Company, upon completion of the Osborn
Transactions and the Pending Acquisitions, will have grown very rapidly, which
will place significant demands on its administrative, operational and financial
resources. The Company's future performance and profitability will depend in
part on its ability to make additional radio station acquisitions in mid-sized
markets, to integrate successfully the operations and systems of acquired radio
stations and radio groups, to hire additional personnel, and to implement
necessary enhancements to its management systems to respond to changes in its
business. The inability of the Company to make additional acquisitions, to
integrate acquired radio stations and radio groups, to hire additional
personnel, or to enhance its management systems could have a material adverse
effect on the Company.
Risks of Acquisition Strategy. The Company intends to pursue growth
through the acquisition of radio broadcasting companies, radio station groups
and individual radio stations in mid-sized markets. The Company cannot predict
whether it will be successful in pursuing such acquisition opportunities or
what the consequences of any such acquisitions would be. The Company is
currently evaluating certain acquisitions; however, other than as described in
"-- The Acquisitions," the Company currently has no binding commitments to
acquire any specific business or other material assets. The Company must
obtain additional financing to consummate the Osborn Add-on Acquisitions and
the Pending Acquisitions and there can be no assurance that such financing will
be available to the Company on terms acceptable to its management or at all.
The consummation of the Osborn Add-on Acquisitions and the Pending Acquisitions
is subject to various conditions, including FCC and other regulatory approval.
No assurances can be given that such transactions will be consummated or that,
if completed, they will be successful. The Company's acquisition strategy
involves numerous risks, including difficulties in the integration of
operations and systems and the management of a large and geographically diverse
group of stations, the diversion of management's attention from other business
concerns and the potential loss of key employees of acquired stations. There
can be no assurance that the Company's management will be able to manage
effectively the resulting business or that such acquisitions will benefit the
Company. Depending upon the nature, size and timing of future acquisitions, the
Company may be required to raise additional financing in addition to the
financing necessary to consummate the Osborn Transactions and the Pending
Acquisitions. There can be no assurance that the New Credit Facility, the
Capstar Indenture, the Indenture or any other loan agreements to which the
Company or Capstar may become a party will permit such additional financing or
that such additional financing will be available to the Company on terms
acceptable to its management or at all. See "Item 7. Management's Discussion
and Analysis of Financial Condition and Results of Operations -- Liquidity and
Capital Resources."
R. Steven Hicks is a party to a noncompetition agreement with SFX
Broadcasting, Inc. ("SFX"), which, among other things, prohibits Mr. Hicks, the
Company and any affiliate of Hicks Muse in which Mr. Hicks has an ownership
interest or to which Mr. Hicks acts as an advisor, from competing with, owning
any direct or indirect interest in or providing any services to any person
which is in the business of owning or operating one or more radio stations
licensed or having a transmitter site within any county in the MSA of certain
specified SFX markets in various states. Until its termination on October 31,
1997, Mr. Hicks' noncompetition agreement with SFX will limit the Company's
ability to enter the markets identified in the noncompetition agreement.
Benchmark owns and operates eight radio stations in the Greenville, South
Carolina and Jackson, Mississippi markets, which are located in prohibited
markets under the noncompetition agreement. The Company expects, subject to all
necessary FCC approval, to assign its right to acquire such radio stations to
another company in which neither Mr. Hicks nor the Company has an ownership
interest or acts as an advisor. Management expects that such other company will
transfer the radio stations to the Company after the noncompetition agreement
has terminated, although no assurances can be given that the Company will ever
own and operate such radio stations.
Dependence on Key Personnel. The Company's business depends upon the
continued efforts, abilities and expertise of its executive officers and other
key employees, including R. Steven Hicks, the Company's Chairman of the Board
and Chief Executive Officer. Capstar has an employment agreement with R.
Steven Hicks, Paul D. Stone, the Company's Vice President, and William S.
Banowsky, Jr., the Company's Vice President. The Company has employment
agreements with certain of its key employees, including James T. Shea, Jr., the
Company's President. The Company has entered into an employment agreement with
Frank D. Osborn, who is the chief executive officer of the Southeast Region,
and the Company will enter into an employment agreement with David J. Benjamin,
III who will serve as the chief executive officer of the West Region, upon
consummation of the Community Pacific Acquisition. The
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<PAGE> 36
Company has also entered into an employment agreement with Dex Allen, the
president and chief operating officer of the West Region. The Company believes
that the loss of any of these individuals could have a material adverse effect
on the Company. See "Item 10. Directors and Executive Officers of the
Registrant."
Conflict of Interest. Thomas O. Hicks controls the voting power of
100.0% of the outstanding voting capital stock of Capstar. Thomas O. Hicks
also controls the voting power of approximately 90.1% of the outstanding voting
common stock of GulfStar, a radio broadcasting company that owns and operates
stations in mid-sized markets in Texas, Louisiana and Arkansas and is seeking
to acquire additional radio stations in Texas, Louisiana and New Mexico. In
addition, two of the Company's four directors are also two of the four
directors of GulfStar, and R. Steven Hicks, the Company's Chairman of the Board
and Chief Executive Officer, and Eric C. Neuman, a Vice President of the
Company, also serve in the same positions with GulfStar. Accordingly, R. Steven
Hicks and Eric C. Neuman will not expend all of their professional time on
behalf of the Company. See "Item 10. Directors and Executive Officers of the
Registrant."
Directors and executive officers of the Company who are also directors
and executive officers of GulfStar may have conflicts of interest with respect
to matters potentially or actually involving or affecting the Company and
GulfStar, such as acquisitions, operations, financings and other corporate
opportunities that may be suitable for both the Company and GulfStar. To the
extent that such opportunities arise, such directors and executive officers may
consult with their legal advisors and make determinations with respect to such
opportunities after consideration of a number of factors, including whether
such opportunities are presented to any such director or executive officer in
his capacity as a director or executive officer of the Company, whether such
opportunities are consistent with the Company's strategic objectives and
whether the Company will be able to undertake or benefit from such
opportunities. In addition, determinations may be made by the Company's Board
of Directors, when appropriate, by a vote of the disinterested directors only.
No assurances can be given that such disinterested director approval will be
sought or that any such conflicts will be resolved in favor of the Company.
In November 1996, Capstar and GulfStar entered into a letter of intent
to merge the two companies. Subsequent to execution of the letter of intent, the
parties received early termination of the applicable waiting period with respect
to the merger under the HSR Act. Thereafter, the parties terminated the letter
of intent and ceased negotiations to consummate the merger. Capstar is again
considering a business combination with GulfStar, although no letter of intent
or definitive agreement has been entered into. Such a business combination
would be subject to, among other things, Capstar and GulfStar reaching agreement
on material terms and conditions, obtaining the FCC's approval of the transfer
of control of broadcast licenses, and obtaining the approval of the advisory
committee or limited partners of HM Fund III. No assurances can be given that
Capstar and GulfStar will negotiate or enter into such an agreement, that such
an agreement would contain terms and conditions favorable to the Company, that
the advisory committee or limited partners of HM Fund III would approve a
combination of Capstar and GulfStar, or that such a combination would strengthen
the Company's business, operations or financial position.
Competition; Business Risks. Radio broadcasting is a highly
competitive business. The Company's radio stations, now owned or to be acquired
upon completion of the Osborn Add-on Acquisitions and the Pending Acquisitions,
compete for audiences and advertising revenues within their respective markets
directly with other radio stations, as well as with other media, such as
newspapers, magazines, cable television, outdoor advertising and direct mail.
In addition, certain of the Company's stations compete, and in the future other
of the Company's stations may compete, with groups of two or more stations
operated by a single operator. Audience ratings and market shares are subject
to change and any adverse change in a particular market could have a material
adverse effect on the revenue of stations located in that market. While the
Company already competes with other stations with comparable programming
formats in many of its markets, if another radio station in the market were to
convert its programming format to a format similar to one of the Company's
stations, if a new station were to adopt a competitive format, or if an
existing competitor were to strengthen its operations, the Company's stations
could suffer a reduction in ratings and/or advertising revenue and could
require increased promotional and other expenses. The Telecom Act facilitates
the entry of other radio broadcasting companies into the markets in which the
Company operates or may operate in the future. Some of such companies may be
larger and have more financial resources than the Company. Future operations
are further subject to many variables which could have a material adverse
effect upon the Company's financial performance. These variables include
economic conditions, both generally and relative to the radio broadcasting
industry; shifts in population and other demographics; the level of competition
for advertising dollars with other radio stations, television stations and
other entertainment and communications media; fluctuations in operating costs;
technological changes and innovations; changes in labor conditions; and changes
in governmental regulations and policies and actions of federal regulatory
bodies, including the DOJ, the FTC and the FCC. Although the Company believes
that substantially all of its radio stations, now owned or to be acquired upon
completion of the Osborn Add-on Acquisitions and the Pending Acquisitions, are
positioned to compete effectively in their respective markets, there can be no
assurance that any such station will be able to maintain
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or increase its current audience ratings and advertising revenues. See "--
Competition; Changes in the Broadcasting Industry."
Radio broadcasting is also subject to competition from new media
technologies that are being developed or introduced, such as the delivery of
audio programming by cable television systems or the introduction of digital
audio broadcasting ("DAB"). DAB may deliver by satellite to nationwide and
regional audiences multi-channel, multi-format digital radio services with
sound quality equivalent to compact discs. The Company cannot predict the
effect, if any, that any such new technologies may have on the radio
broadcasting industry or the Company. See "-- Competition; Changes in the
Broadcasting Industry."
Governmental Regulation of Broadcasting Industry. The broadcasting
industry is subject to extensive federal regulation that, among other things,
requires approval by the FCC for the issuance, renewal, transfer of control and
assignment of broadcasting station operating licenses and limits the number of
broadcasting properties that the Company may acquire in any market.
Additionally, the Communications Act and FCC rules impose limitations on alien
ownership and voting of the capital stock of the Company. The Telecom Act
creates significant new opportunities for broadcasting companies but also
creates uncertainties as to how the FCC and the courts will enforce and
interpret the Telecom Act.
In addition, the number of radio stations the Company may acquire in
any market is limited by FCC rules and may vary depending upon whether the
interests in other radio stations or certain other media properties of certain
individuals affiliated with the Company are attributable to those individuals
under FCC rules. Moreover, under the FCC's cross-interest policy, the FCC in
certain instances may prohibit one party from acquiring an attributable
interest in one media outlet and a substantial non-attributable economic
interest in another media outlet in the same market, thereby prohibiting a
particular acquisition by the Company.
The FCC generally applies its ownership limits to "attributable"
interests held by an individual, corporation, partnership or other association.
The interests of the Company's officers, directors and majority stockholder are
generally attributable to the Company. Certain of the Company's officers and
directors have attributable broadcast interests, which will limit the number of
radio stations that the Company may acquire or own in any market in which such
officers or directors hold or acquire attributable broadcast interests.
The consummation of radio broadcasting acquisitions requires prior
approval of the FCC with respect to the transfer of control or assignment of
the broadcast licenses of the acquired stations. Certain of the Pending
Acquisitions have not yet received FCC approval. There can be no assurance that
the FCC will approve future acquisitions by the Company (including the Pending
Acquisitions). The consummation of certain acquisitions, including certain of
the Pending Acquisitions, is also subject to applicable waiting periods and
possible review by the DOJ or the FTC under the HSR Act. The Company
understands that since the passage of the Telecom Act several radio
broadcasting acquisitions have been the subject of "second requests" for
additional information by federal authorities under the HSR Act. On February
14, 1997, Capstar received such a second request with respect to the Benchmark
Acquisition. The Company also understands that the DOJ is currently reviewing
its internal guidelines for antitrust review of radio broadcasting
acquisitions. See "-- Federal Regulation of Radio Broadcasting."
The Company's business will be dependent upon maintaining its
broadcasting licenses issued by the FCC, which are ordinarily issued for a
maximum term of eight years. Although it is rare for the FCC to deny a license
renewal application, there can be no assurance that the future renewal
applications of the Company will be approved or that such renewals will not
include conditions or qualifications that could adversely affect the Company.
Moreover, governmental regulations and policies may change over time and there
can be no assurance that such changes would not have a material adverse impact
upon the Company. See "-- Federal Regulation of Radio Broadcasting."
Change of Control. The Indenture provides that, upon a change of
control (as therein defined) of the Company, the Company will be required to
purchase all of the Notes then outstanding at a purchase price equal to 101.0%
of their accreted value (as therein defined), plus accrued interest to the date
of repurchase, in the case of such a purchase prior to May 1, 1998, and
thereafter at a purchase price equal to 101.0% of the principal amount thereof,
plus accrued interest to the date of repurchase. A change of control under the
Indenture will constitute an event of default under the New Credit Facility.
The Company would be required to consummate such a purchase of the Notes and
repay borrowings under the New Credit Facility. As of the date of this Annual
Report on Form 10-K, after giving effect to the consummation of the Osborn
Transactions and the Pending Acquisitions, the Company would not have
sufficient funds available to purchase all of the outstanding Notes pursuant to
a change of control offer. In the event that the Company were required to
purchase the Notes pursuant to a change of control offer, the Company expects
that it would need to seek third-party financing to the extent it does not have
available funds to meet its purchase obligations. However, there
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can be no assurance that the Company would be able to obtain such financing on
favorable terms, if at all. See "-- Risk Associated with Business Activities
- -- Substantial Leverage" and "-- Restrictions Imposed by Terms of
Indebtedness." In such event, the Company may be unable to repurchase Notes
tendered in response to a change of control offer.
FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K contains or may contain certain
forward-looking statements and information that are based on beliefs of, and
information currently available to, the Company's management as well as
estimates and assumptions made by the Company's management. When used in this
Annual Report on Form 10-K, words such as "anticipate," "believe," "estimate,"
"expect," "future," "intend," "project," "will," "could," "may," "plan" and
similar expressions as they relate to the Company or the Company's management,
identify forward-looking statements. Such statements reflect the current views
of the Company with respect to future events and are subject to certain risks,
uncertainties and assumptions relating to the Company's operations and results
of operations, competitive factors and pricing pressures, shifts in market
demand, the performance and needs of the industries served by the Company, the
costs of product development and other risks and uncertainties including, in
addition to any uncertainties specifically identified in the text surrounding
such statements, uncertainties with respect to changes or developments in
social, economic, business, industry, market, legal and regulatory
circumstances and conditions and actions taken or omitted to be taken by third
parties, including the Company's sole stockholder, customers, suppliers,
business partners, competitors, and legislative, regulatory, judicial and other
governmental authorities and officials. Should one or more of these risks or
uncertainties materialize, or should the underlying estimates or assumptions
prove incorrect, actual results or outcomes may vary significantly from those
anticipated, believed, estimated, projected, expected, intended, planned or
otherwise indicated.
GLOSSARY OF CERTAIN TERMS AND MARKET AND INDUSTRY DATA
"Additional Osborn Registrants" collectively refers to Osborn
Communications Corporation, Asheville Broadcasting Corp., Atlantic City
Broadcasting Corp., Beatrice Broadcasting Corp., Breadbasket Broadcasting
Corporation, Corkscrew Broadcasting Corporation, Currey Broadcasting
Corporation, Daytona Beach Broadcasting Corp., Great American East, Inc.,
Houndstooth Broadcasting Corporation, Jamboree in the Hills, Inc., Ladner
Communications Holding Corp., Mountain Radio Corporation, O.C.C., Inc., Orange
Communications, Inc., Osborn Entertainment Enterprises Corporation, Osborn
Sound & Communications Corp., RKZ Television, Inc., Rainbow Broadcasting
Corporation, Short Broadcasting Corporation, SNG Holdings, Inc., Southeast
Radio Holding Corp., Waite Broadcasting Corp., Yellow Brick Radio Corporation,
Ameron Broadcasting Corporation and WNOK Acquisition Company, Inc.
"advertising inventory" refers to the amount of advertising air time a
radio station has available to sell to advertisers.
"broadcast cash flow" consists of operating income before
depreciation, amortization, corporate, other operating expenses and long-term
compensation expenses. Although broadcast cash flow is not a measure of
performance calculated in accordance with generally accepted accounting
principles ("GAAP"), management believes that it is useful to an investor in
evaluating the Company because it is a measure widely used in the broadcast
industry to evaluate a radio company's operating performance. However,
broadcast cash flow should not be considered in isolation or as a substitute
for net income, cash flows from operating activities and other income or cash
flow statement data prepared in accordance with GAAP as a measure of liquidity
or profitability.
"EBITDA" consists of operating income before depreciation,
amortization, other operating expenses and long-term compensation expenses.
Although EBITDA is not a measure of performance calculated in accordance with
GAAP, management believes that it is useful to an investor in evaluating the
Company because it is a measure widely used in the broadcast industry to
evaluate a radio company's operating performance. However, EBITDA should not
be considered in isolation or as a substitute for net income, cash flows from
operating activities and other income or cash flow statement data prepared in
accordance with GAAP as a measure of liquidity or profitability.
"JSA" refers to a joint sales agreement, whereby a station licensee
obtains, for a fee, the right to sell substantially all of the commercial
advertising on a separately-owned and licensed station. JSAs take varying
forms. A JSA, unlike an LMA, normally does not involve programming.
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"LMA" refers to a local marketing agreement, whereby a radio station
outsources the management of certain limited functions of its operations. LMAs
take varying forms; however, the FCC requires that, in all cases, the licensee
maintain independent control over the programming and operations of the
station.
Unless otherwise indicated herein, (i) MSA rankings by population were
obtained from the Summer 1996 Radio Market Survey Schedule (copyright 1996), as
provided by The Arbitron Company ("Arbitron"), (ii) all audience share
rankings, except for the Yuma, Arizona market and where specifically stated to
the contrary, have been derived from surveys of persons, ages 25 to 54,
listening Monday through Sunday, 6 a.m. to 12 midnight, and are based on
either the Spring or Summer 1996 survey period, as reported in Radio Market
Reports, Metro Audience Trends (copyright 1996), a publication of Arbitron,
(iii) audience share rankings in Yuma, Arizona, are based on the Spring 1996
survey period, as reported in AccuRatings(TM) (Copyright 1996), a publication
of Strategic Radio Research, Inc. ("AccuRatings(TM)") and (iv) all revenue
share rankings are based on data compiled as of September 1996, as reported in
BIA Publications Radio Analyzer -- BIA's Master Access, Version 1.7 (copyright
1996), a computer database by BIA Publications Inc. ("BIA").
ITEM 2. PROPERTIES
The types of properties required to support each of the Company's
radio stations include offices, studios and transmitter/antenna sites. A
station's studios are generally housed with its offices in downtown or business
districts. The transmitter/antenna sites generally are located so as to
provide maximum market coverage.
The Company owns transmitter and antenna sites in Norwalk and
Brookfield, Connecticut; Wilmington, Delaware; Port St. Lucie, Vero Beach and
Ft. Pierce, Florida; Catlettsburg, Kentucky; Hartsdale and Brewster, New York;
Whitehall, Pennsylvania; and Huntington, West Virginia. The Company also leases
transmitter and antenna sites in Indian River County and Vero Beach, Florida;
Washington Township and Bethlehem, Pennsylvania; Huntington, Milton and Cabell
County, West Virginia; Pawling and Bedford, New York; and Stamford,
Connecticut. The Company typically leases studio and office space, although it
owns its facilities in Brookfield, Connecticut; Port St. Lucie and Ft. Pierce,
Florida; Catlettsburg, Kentucky; Hartsdale and Patterson, New York; and
Huntington, West Virginia. Upon completion of the Osborn Transactions, the
Company will also (i) own transmitter and antenna sites in Gadsden and
Tuscaloosa, Alabama, Asheville, North Carolina, Dayton, Ohio, Jackson,
Tennessee and Wheeling, West Virginia, (ii) lease transmitter and antenna sites
in Huntsville and Tuscaloosa, Alabama, Asheville, North Carolina, Bridgeport
and Dayton, Ohio and Wheeling, West Virginia and (iii) own studio and office
space in Gadsden and Tuscaloosa, Alabama, Asheville, North Carolina, Jackson,
Tennessee and Wheeling, West Virginia.
The Company generally considers its facilities to be suitable and of
adequate size for its current and intended purposes. The Company generally does
not anticipate any difficulties in renewing any facility leases or in leasing
additional space, if required.
The Company owns substantially all of its other equipment, consisting
principally of transmitting antennae, transmitters, studio equipment and
general office equipment. The towers, antennae and other transmission equipment
used by the Company's stations are generally in good condition, although
opportunities to upgrade facilities are continuously reviewed.
The principal executive offices of the Company are located at 500
Fifth Avenue, Suite 3000, New York, New York 10110. The telephone number of
the Company at that address is (212) 302-2727.
ITEM 3. LEGAL PROCEEDINGS
The Company is involved in litigation from time to time in the
ordinary course of its business. In management's opinion, the litigation in
which the Company is currently involved, individually and in the aggregate, is
not material to the Company's financial condition or results of operations.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
The Company did not submit any matters to a vote of its security
holders during the fourth quarter of the fiscal year ending December 31, 1996.
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PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock has not been registered under the
Securities Act of 1933, as amended, or the Securities Act of 1934, as amended,
and is not listed on any national securities exchange. As of December 31,
1996, there was no established public trading market for the Company's Common
Stock. The Company is a wholly-owned subsidiary of Capstar.
Holders of shares of Common Stock are entitled to receive such
dividends as may be declared by the Company's Board of Directors out of funds
legally available for such purpose. The Company has not paid any dividends on
its Common Stock since its incorporation. The payment of cash dividends is
currently restricted by the Indenture under which the Company generally is not
permitted to pay cash dividends unless (i) no event of default under the
Indenture exists at the time of payment or immediately thereafter, (ii) certain
ratios regarding the incurrence of additional indebtedness are satisfied and
(iii) the aggregate of all dividends or distributions do not exceed certain
limits set forth in the Indenture. In addition, the payment of cash dividends
is restricted by the New Credit Facility, except that the Company may pay cash
dividends to Capstar to enable Capstar to, among other things, (i) pay
Capstar's operating expenses and other corporate overhead costs and expenses,
subject to a maximum amount of $3.0 million per annum, (ii) pay Capstar's
management fees or executive compensation, (iii) repurchase outstanding capital
stock of Capstar, subject to certain limitations, including a $3.0 million
limitation per annum and a $5.0 million limitation in the aggregate, and (iv)
pay any federal, state or local taxes payable by Capstar. The New Credit
Facility permits any subsidiary of the Company to pay dividends to the Company
or any wholly-owned subsidiary of the Company.
The acquisition of the Company by Capstar for approximately $213.6
million, including assumed debt, was effected through the merger of CMI
Acquisition Company, Inc., a wholly-owned subsidiary of Capstar ("CMI"), with
and into the Company, with the Company as the surviving corporation. By
operation of law, the 1,000 shares of common stock of CMI held by Capstar
immediately prior to the merger were converted at the effective time of the
merger into 1,000 shares of Common Stock. Section 4(2) of the Securities Act
of 1933 was relied on in connection with the issuance of such shares of
Common Stock to Capstar.
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ITEM 6. SELECTED FINANCIAL DATA
The operating and other data in the following table have been derived
from audited financial statements of the Company for the years ended December
31, 1994, 1995 and 1996, all of which are included elsewhere in this Annual
Report on Form 10-K, and from audited financial statements for the years ended
December 31, 1992 and 1993. The selected balance sheet data in the following
table have been derived from the audited financial statements of the Company as
of December 31, 1995 and 1996 which are included elsewhere in this Annual
Report on Form 10-K, and from the audited financial statements of the Company
as of December 31, 1992, 1993 and 1994.
<TABLE>
<CAPTION>
The Company
------------------------------------------------------------------------
Year Ended December 31,
------------------------------------------------------------------------
1992 1993 1994 1995 1996
------------ ------------ ------------ ------------ ------------
(dollars in thousands)
<S> <C> <C> <C> <C> <C>
OPERATING DATA:
Net revenue . . . . . . . . . $17,961 $19,798 $26,225 $30,795 $42,260
Station operating expenses . 12,713 13,509 16,483 19,033 27,576
Depreciation and amortization 1,676 1,129 2,145 1,926 3,193
Corporate expenses . . . . . 1,602 2,531 2,110 2,051 2,134
Other expense(1) . . . . . . -- 1,496 2,180 2,007 13,833
Operating income (loss) . . . 1,970 1,133 3,307 5,778 (4,476)
Interest expense . . . . . . 4,614 4,366 3,152 7,806 11,475
Net loss . . . . . . . . . . (2,580) (3,782) (527) (2,240) (17,908)
OTHER DATA:
Broadcast cash flow(2) . . . $ 5,248 $6,289 $ 9,742 $11,762 $14,684
Broadcast cash flow margin(2) 29.2% 31.8% 37.1% 38.2% 34.7%
EBITDA(3) . . . . . . . . . . $ 3,646 $3,758 $ 7,632 $9,711 $12,550
Capital expenditures . . . . 371 333 623 321 933
BALANCE SHEET DATA (END OF
PERIOD):
Cash and cash equivalents . . $ 1,045 $ 887 $ 2,042 $10,891 $ 4,368
Working Capital, excluding
current 1,094 3,393 3,012 13,729 10,066
portion of long-term debt
Intangible and other assets, net 13,819 22,419 21,096 27,422 67,077
Total assets . . . . . . . . 27,508 36,192 36,283 52,811 95,065
Long-term debt, including
current 51,934 41,773 36,962 66,261 94,487
portion . . . . . . . . .
Redeemable preferred stock . 5,800 10 8,414 --
Total stockholders' equity (28,766) (8,097) (18,038) (18,555) (4,830)
(deficit) . . . . . . . . . .
</TABLE>
(1) Other expense consists of separation compensation in 1993 and
long-term incentive compensation under restructured employment
agreements with the Company's former President and Chief Executive
Officer and its Chief Operating Officer in 1994 and 1995. In 1996,
other expense consists of merger-related compensation charges in
connection with Capstar's acquisition of the Company. Such expenses
are not expected to recur.
(2) Broadcast cash flow consists of operating income before depreciation,
amortization, corporate expense and other operating expenses. See
"Item 1. Business -- Glossary of Certain Terms and Market and Industry
Data."
(3) EBITDA consists of operating income before depreciation, amortization
and other operating expenses. See "Item 1. Business -- Glossary of
Certain Terms and Market and Industry Data."
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
GENERAL
The following discussion and analysis of financial condition and
results of operations of the Company should be read in conjunction with the
consolidated financial statements and related notes thereto of the Company
included elsewhere in this Annual Report on Form 10-K. Periodically, the
Company may make statements about trends, future plans and the Company's
prospects. Actual results may differ materially from those described in such
forward looking statements based on the risks and uncertainties facing the
Company, including but not limited to, the following: business conditions and
growth in the radio broadcasting industry and the general economy; competitive
factors; changes in interest rates; the failure or inability to renew one or
more of the Company's broadcasting licenses; and the factors described in "Item
1. Business -- Risks Associated with Business Activities."
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A radio broadcast company's revenues are derived primarily from the
sale of time to local and national advertisers. Those revenues are affected by
the advertising rates that a radio station is able to charge and the number of
advertisements that can be broadcast without jeopardizing listener levels (and
resulting ratings). Advertising rates tend to be based upon demand for a
station's advertising inventory and its ability to attract audiences in
targeted demographic groups, as measured principally by Arbitron. Radio
stations attempt to maximize revenues by adjusting advertising rates based upon
local market conditions, controlling advertising inventory and creating demand
and audience ratings.
Seasonal revenue fluctuations are common in the radio broadcasting
industry and are due primarily to fluctuations in advertising expenditures by
local and national advertisers, with revenues typically being lowest in the
first quarter and highest in the second and fourth quarters of each year.
Accordingly, the Company expects working capital to decrease and net losses to
increase in the first quarter. Accordingly, management expects working capital
to decline in the first quarter of 1997. A radio station's operating results in
any period also may be affected by the occurrence of advertising and
promotional expenditures that do not produce commensurate revenues in the
period in which the expenditures are made. Because Arbitron reports audience
ratings on a quarterly basis, a radio station's ability to realize revenues as
a result of increased advertising and promotional expenses and any resulting
audience ratings improvements may be delayed for several months.
In October 1996, the Company was acquired by Capstar. Upon completion
of the Osborn Transactions and the Pending Acquisitions, the Company will own,
operate or provide services to 121 radio stations serving 31 mid-sized markets.
The Company anticipates that it will consummate the Pending Acquisitions;
however, the closing of each such acquisition is subject to various conditions,
including FCC and other governmental approvals, which are beyond the Company's
control, and the availability of financing to Capstar or the Company on
acceptable terms. No assurances can be given that regulatory approval will be
received, that the New Credit Facility, the Capstar Indenture, the Indenture or
any other loan agreements to which Capstar or the Company will be a party will
permit additional financing for the Pending Acquisitions or that such financing
will be available to Capstar or the Company on acceptable terms. See "Item 1.
Business -- Risks Associated with Business Activities -- Risks of Acquisition
Strategy."
The Company will incur substantial indebtedness to finance the Osborn
Transactions and the Pending Acquisitions for which it has, and will continue
to have, significant debt service requirements. In addition, the Company has,
and will continue to have, significant charges for depreciation and
amortization expense related to the fixed assets and intangibles acquired, or
to be acquired, in its acquisitions. Consequently, the Company expects that it
will report net losses for the foreseeable future.
In the following analysis, management discusses broadcast cash flow
and EBITDA. Broadcast cash flow consists of operating income before
depreciation, amortization, corporate expenses and other operating expenses.
EBITDA consists of operating income before depreciation, amortization and other
operating expenses. Although broadcast cash flow and EBITDA are not measures of
performance calculated in accordance with generally accepted accounting
principles ("GAAP"), management believes that they are useful to an investor in
evaluating the Company because they are measures widely used in the broadcast
industry to evaluate a radio company's operating performance. However,
broadcast cash flow and EBITDA should not be considered in isolation or as
substitutes for net income, cash flows from operating activities and other
income or cash flow statement data prepared in accordance with GAAP or as a
measure of liquidity or profitability.
RESULTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995
Net Revenue. Net revenue increased $11.5 million or 37.3% to $42.3
million in the year ended December 31, 1996 from $30.8 million in the year ended
December 31, 1995. The inclusion of revenue from the acquisitions of radio
stations and revenue generated from JSAs and LMAs entered into during the years
ended December 31, 1996 and 1995 provided $10.8 million of the increase. For
stations owned and operated for a comparable period in 1996 and 1995, net
revenue improved approximately $669,000 or 2.3% to $30.0 million in 1996 from
$29.3 million in 1995 primarily due to increased ratings and improved selling
efforts.
Station Operating Expenses. Station operating expenses increased $8.6
million or 44.9% to $27.6 million in the year ended December 31, 1996 from $19.0
million during the year ended December 31, 1995. The increase was primarily
attributable to the station operating expenses of the radio station acquisitions
and the JSAs and LMAs entered into during the years ended December 31, 1996 and
1995, which contributed $9.0 million to the increase. For stations owned and
operated for a comparable period in 1996 and 1995, station operating expenses
declined
42
<PAGE> 43
approximately $461,000, or 2.6% to $17.6 million in 1996 from $18.0 million in
1995 which reflected more efficient operations.
Broadcast Cash Flow. As a result of the factors described above,
broadcast cash flow increased $2.9 million or 24.8% to $14.7 million in the year
ended December 31, 1996 from $11.8 million in the year ended December 31, 1995.
The inclusion of broadcast cash flow from acquisitions and LMAs accounted for
$1.8 million of the increase. The broadcast cash flow margin was 34.7% for the
period in 1996 as compared to 38.2% during the same period in 1995. Excluding
the effects of the acquisitions and LMAs, broadcast cash flow increased $1.1
million or 10.0% to $12.5 million in 1996 from $11.3 million in 1995 and the
broadcast cash flow margin increased to 41.5% from 38.6%.
Corporate Expenses. Corporate expenses increased approximately
$83,000 or 4.0% during 1996 to $2.0 million as a result of higher salary
expense for additional staffing.
EBITDA. As a result of the factors described above, EBITDA increased
$2.8 million or 29.2% to $12.6 million in the year ended December 31, 1996 from
$9.7 million in the year ended December 31, 1995. The EBITDA margin decreased to
29.7% in 1996 from 31.5% in 1995.
Other Operating Expenses. Depreciation and amortization increased $1.3
million or 65.8% to $3.2 million in 1996 from $1.9 million in 1995 primarily due
to certain radio station acquisitions consummated in 1996 and 1995. In 1996,
the Company recognized $13.8 million in merger related compensation charges in
connection with the Capstar's acquisition of the Company. Long-term incentive
compensation expense incurred by the Company pursuant to the prior employment
agreements of Bruce A. Friedman and James T. Shea, Jr. was $2.0 million in 1995.
Other (Income) Expenses. Interest expense increased $3.7 million or
47.0% to $11.5 million in the year ended December 31, 1996 from $7.8 million
during the same period in 1995 primarily due to the interest expense associated
with the Notes and $24.7 million in acquisition and working capital funding from
CHI's AT&T Credit Facility (as defined). Other expenses, net, increased to $2.0
million for the year ended December 31, 1996 from approximately $49,000 for the
period ended December 31, 1995. The increase was primarily due to approximately
$525,000 in expenses associated with the filing of the Company's Registration
Statement on Form S-1 with the Securities and Exchange Commission on May 17,
1996, which was subsequently withdrawn, and $1.4 million of merger related costs
and expenses in connection with Capstar's acquisition of the Company. The
Company earned approximately $256,000 in interest income on its temporary cash
investments in 1996, a 39.0% decrease over the prior year. Extraordinary loss
on extinguishment of debt of approximately $444,000 was recorded in 1995 in
connection with the Company's debt restructuring on April 21, 1995. The Company
did not recognize any extraordinary income or loss items in 1996.
Net Loss. As a result of the factors described above, net loss
increased approximately $15.7 million to $17.9 million for the year ended
December 31, 1996 from $2.2 million for the year ended December 31, 1995.
YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31, 1994
Net Revenue. Net revenue increased $4.6 million or 17.4% to $30.8
million in 1995 from $26.2 million in 1994. The inclusion of revenue from the
acquisition and revenue generated from JSAs and LMAs entered into during 1995
provided approximately $1.5 million of the increase. For stations owned and
operated for a comparable period in 1995 and 1994, net revenue improved $3.1
million or 11.9% to $29.3 million in 1995 from $26.2 million in 1994, primarily
due to higher ratings and improved selling efforts.
Station Operating Expenses. Station operating expenses increased $2.5
million or 15.5% to $19.0 million in 1995 from $16.5 million in 1994 partially
due to the inclusion of station operating expenses from the newly acquired radio
station and from the JSA and LMA activity in 1995, which contributed $1.0
million to the increase. For stations owned and operated for a comparable period
in 1995 and 1994, station operating expenses increased $1.5 million or 9.3% to
$18.0 million in 1995 from $16.5 million in 1994 due to increased selling
expenses.
Broadcast Cash Flow. As a result of the factors described above,
broadcast cash flow increased $2.0 million or 20.7% to $11.8 million in 1995
from $9.7 million in 1994. The inclusion of broadcast cash flow from
acquisitions, JSAs and LMAs accounted for approximately $437,000 of the
increase. The broadcast cash flow margin was 38.2% in 1995 as compared to 37.1%
in 1994. Excluding the effects of the acquisitions, broadcast cash flow
43
<PAGE> 44
increased $1.6 million or 16.3% to $11.3 million in 1995 from $9.7 million in
1994 and the broadcast cash flow margin increased to 38.6% from 37.1%.
Corporate Operating Expenses. Corporate expenses decreased
approximately $59,000 or 2.8% to $2.0 million in 1995 from $2.1 million in 1994
as a result of reduced travel and entertainment expenses.
EBITDA. As a result of the factors described above, EBITDA increased
$2.1 million or 27.2% to $9.7 million in the year ended December 31, 1995 from
$7.6 million in the year ended December 31, 1994. The EBITDA margin increased to
31.5% in 1995 from 29.1% in 1995.
Other Operating Expenses. Depreciation and amortization decreased
approximately $219,000 or 10.2% to $1.9 million in 1995 from $2.1 million in
1994 primarily as a result of the Company fully amortizing certain costs
associated with the acquisition in December 1993. Long-term incentive
compensation decreased approximately $173,000 or 8.0% to $2.0 million in 1995
from $2.2 million in 1994.
Other (Income) Expenses. Interest expense increased $4.7 million or
147.6% to $7.8 million in 1995 from $3.2 million in 1994. The increase was due
primarily to the cash and noncash interest on the Notes issued in connection
with the Recapitalization Transactions (as defined) as well as an increase in
amortization of the deferred financing charges associated with the
Recapitalization Transactions. "Recapitalization Transactions" means the
completed offering of the Notes, the net proceeds of which were used to repay
indebtedness of the Company and redeem certain outstanding shares of preferred
stock of the Company. The Company reflected an extraordinary loss on
extinguishment of debt of approximately $444,000 in 1995 in connection with the
Recapitalization Transactions. The Company recognized approximately $421,000 of
interest income on its temporary cash investments during 1995. Other expenses,
net, decreased approximately $333,000 to approximately $49,000 in 1995 from
approximately $382,000 in 1994 primarily due to a decrease in the loss on sale
of assets.
Net Loss. As a result of the factors described above, net loss
increased $1.7 million to $2.2 million in 1995 from approximately $527,000 in
1994.
LIQUIDITY AND CAPITAL RESOURCES
The Company funded the $113.0 million purchase price (excluding
transaction costs) for the Osborn Acquisition with an equity investment made by
Capstar.
The Notes require semi-annual cash interest payments on each May 1 and
November 1 of $2.9 million through May 1, 1998 and $5.2 million from November
1, 1998 until maturity. Borrowings under the New Credit Facility bear interest
at floating rates and require interest payments on varying dates depending on
the interest rate option selected by the Company. The New Credit Facility
consists of the $50.0 million revolver. All loans outstanding under the New
Credit Facility will mature in 2002. The Company did not borrow under the New
Credit Facility in connection with the Osborn Acquisition and no balance was
outstanding as of March 15, 1997.
In addition to debt service, the Company's principal liquidity
requirements will be for working capital and general corporate purposes,
including capital expenditures, which are not expected to be material in
amount, and to consummate the Osborn Add-on Acquisitions and the Pending
Acquisitions and, as appropriate opportunities arise, to acquire additional
radio stations. The Company intends to use the $11.0 million in net proceeds of
the Osborn Ft. Myers Disposition to repay in part indebtedness, if any, under
the New Credit Facility. The Company intends to fund the $316.3 million
aggregate purchase price (including $25.7 million for the Osborn Add-on
Acquisitions and transaction costs) for the Osborn Add-on Acquisitions and the
Pending Acquisitions through a combination of borrowings under the New Credit
Facility (as it may be amended to increase the borrowing limit thereunder) and
a combination of indebtedness of the Company and/or Capstar (which proceeds
will be invested in the Company) and/or capital stock of Capstar or its
subsidiaries. The Company has not determined the terms of any such
indebtedness or capital stock. The Company's ability to make such borrowings
and issue such indebtedness and capital stock will depend upon many factors,
including, but not limited to, the Company's success in operating and
integrating its radio stations and the condition of the capital markets at the
times of consummation of the Pending Acquisitions. No assurances can be given
that such financings can be consummated on terms considered to be favorable by
management or at all.
Management believes that cash from operating activities, together with
available revolving credit borrowings under the New Credit Facility and equity
investments by Capstar, should be sufficient to permit the Company to fund
44
<PAGE> 45
its operations and meet its obligations under the agreements governing the
existing indebtedness. The Company may require financing for additional future
acquisitions, if any, and there can be no assurance that it would be able to
obtain such financing on terms considered to be favorable by management.
Management evaluates potential acquisition opportunities on an on-going basis
and has had, and continues to have, preliminary discussions concerning the
purchase of additional stations. The Company expects that in connection with
the financing of future acquisitions, it may consider disposing of stations in
its markets. The Company has no current plans or arrangements to dispose of any
of its stations other than the Osborn Ft. Myers Disposition and the disposition
of station KASH-AM in Anchorage, Alaska after consummation of the Community
Pacific Acquisition.
EXTRAORDINARY ITEM
In connection with the Osborn Acquisition, the Company repaid the AT&T
Credit Facility. The repayment of the AT&T Credit Facility resulted in the
write off of deferred financing costs and prepayment penalties in the amount of
$1.3 million, which will be reported as an extraordinary item. In connection
with the Benchmark Acquisition, Capstar will issue $750,000 of Capstar Common
Stock for the benefit of the Company to an affiliate of Hicks Muse in
consideration for its unconditional guarantee of a Fund III Acquisition Sub's
indebtedness incurred in connection with the Benchmark Acquisition. The
issuance of Capstar Common Stock for the benefit of the Company will be reported
as an extraordinary item in the period in which the Company consummates the
Benchmark Acquisition. Had the Benchmark Acquisition been consummated at
December 31, 1996, the Company would have recorded an extraordinary charge of
approximately $750,000.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
<TABLE>
<CAPTION>
INDEX
-----
Page
----
<S> <C>
Report of Independent Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Consolidated Balance Sheets as of December 31, 1996 and 1995 . . . . . . . . . . . . . . . . . . 47
Consolidated Statements of Operations for the Years Ended December 31, 1996, 1995 and 1994 . . . 48
Consolidated Statements of Stockholders' Deficit for the Years Ended December 31, 1996, 1995
and 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Consolidated Statements of Cash Flows for the Years Ended December 31, 1996, 1995 and 1994 . . . 50
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Schedule II - Valuation and Qualifying Accounts . . . . . . . . . . . . . . . . . . . . . . . . . 79
</TABLE>
45
<PAGE> 46
Report of Independent Auditors
To the Board of Directors
Commodore Media, Inc.
We have audited the accompanying consolidated balance sheets of Commodore
Media, Inc. and Subsidiaries as of December 31, 1996 and 1995 and the related
consolidated statements of operations, stockholders' deficit and cash flows for
each of the three years in the period ended December 31, 1996. Our audits also
included the financial statement schedule listed in the Index at Item 14(a).
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements and
the schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. These standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
Commodore Media, Inc. and Subsidiaries as of December 31, 1996 and 1995, and
the consolidated results of their operations and their cash flows and each of
the three years in the period ended December 31, 1996, in conformity with
generally accepted accounting principles. Also, in our opinion, the related
financial statement schedule, when considered in relation to the basic
financial statements taken as a whole, presents fairly in all material respects
the information set forth therein.
ERNST & YOUNG LLP
New York, New York
January 31, 1997, except for Note 14, as
to which the date is March 20, 1997
46
<PAGE> 47
Commodore Media, Inc. and Subsidiaries
Consolidated Balance Sheets
<TABLE>
<CAPTION>
DECEMBER 31
1996 1995
------------------------------
ASSETS
<S> <C> <C>
Current assets:
Cash and short-term cash investments $ 4,367,847 $ 10,891,489
Accounts receivable, less allowance of $838,081 and $700,336
in 1996 and 1995 8,912,965 6,131,447
Prepaid expenses and other current assets 443,900 285,412
------------------------------
Total current assets 13,724,712 17,308,348
Property, plant and equipment, net 14,263,055 8,080,043
FCC licenses and goodwill, net of accumulated amortization
of $5,080,681 in 1996 and $3,912,167 in 1995 59,172,868 20,767,625
Other intangible assets 2,964,621 1,761,306
Deferred charges, net 4,186,451 3,910,582
Deposits and other assets 753,340 982,876
------------------------------
Total assets $ 95,065,047 $ 52,810,780
==============================
LIABILITIES AND STOCKHOLDERS' DEFICIT Current liabilities:
Accounts payable and accrued expenses $ 2,260,066 $ 1,774,256
Accrued compensation 422,062 815,162
Accrued interest 960,084 960,368
Accrued income taxes -- 16,840
Current maturities of capital lease obligations 16,056 11,977
Current maturities of long-term debt 3,750,000 --
------------------------------
Total current liabilities 7,408,268 3,578,603
Long-term capital lease obligations 49,629 43,130
Long-term debt 90,737,274 66,261,339
Noncurrent compensation -- 1,482,275
Deferred income taxes 1,700,000 --
Stockholders' deficit:
Class A Common Stock, $0.01 par value; 3,000,000 shares
authorized: 1,000 shares issued and outstanding in 1996 and
146,526 shares issued and outstanding in 1995 10 1,465
Class B Common Stock, convertible into Class A Common Stock,
$0.01 par value; 486,373 shares authorized and issued in 1995 -- 4,864
Additional paid-in capital 55,192,892 23,580,184
Accumulated deficit (60,023,026) (42,115,080)
------------------------------
(4,830,124) (18,528,567)
Less treasury stock, at cost, 85,524 shares in 1995 -- 26,000
------------------------------
Total stockholders' deficit (4,830,124) (18,554,567)
------------------------------
Total liabilities and stockholders' deficit $ 95,065,047 $ 52,810,780
==============================
</TABLE>
See accompanying notes.
47
<PAGE> 48
Commodore Media, Inc. and Subsidiaries
Consolidated Statements of Operations
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1996 1995 1994
-------------------------------------------------
<S> <C> <C> <C>
Total revenue $ 45,959,646 $ 33,652,677 $ 28,686,381
Less agency commissions (3,699,285) (2,857,912) (2,461,478)
-------------------------------------------------
Net revenue 42,260,361 30,794,765 26,224,903
-------------------------------------------------
Operating expenses:
Programming, technical and news 7,743,634 5,365,686 4,601,374
Sales and promotion 12,239,804 8,796,481 7,325,549
General and administrative 7,592,405 4,870,463 4,556,515
Corporate expenses 2,134,102 2,051,181 2,109,741
Depreciation and amortization 3,192,803 1,926,250 2,145,201
Long-term incentive compensation 1,102,141 2,006,550 2,180,000
Merger related stock option compensation 12,731,587 -- --
-------------------------------------------------
Operating (loss) income (4,476,115) 5,778,154 3,306,523
Interest expense 11,474,720 7,805,525 3,152,352
Interest income 255,869 420,659 266
Initial public offering and merger expenses 1,909,648 -- --
Other expenses, net 170,856 48,796 381,550
-------------------------------------------------
Loss before provision for income taxes and
extraordinary loss (17,775,470) (1,655,508) (227,113)
Provision for income taxes 132,476 140,634 300,000
-------------------------------------------------
Loss before extraordinary loss (17,907,946) (1,796,142) (527,113)
Extraordinary loss on extinguishment of debt -- (443,521) --
-------------------------------------------------
Net loss $(17,907,946) $ (2,239,663) $ (527,113)
================================================
</TABLE>
See accompanying notes.
48
<PAGE> 49
Commodore Media, Inc. and Subsidiaries
Consolidated Statements of Stockholders' Deficit
<TABLE>
<CAPTION>
COMMON STOCK
PAR VALUE ADDITIONAL TOTAL
------------------ PAID-IN ACCUMULATED TREASURY STOCKHOLDERS'
CLASS A CLASS B CAPITAL DEFICIT STOCK DEFICIT
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at December 31, 1993 $ 1,192 $ 4,864 $ 22,523,192 $(38,348,304) $ (1,000) $(15,820,056)
Cumulative dividends on redeemable preferred stock -- -- (690,660) -- -- (690,660)
Adjustment to carrying value of redeemable warrant -- -- -- (1,000,000) -- (1,000,000)
Loss for the year -- -- -- (527,113) -- (527,113)
---------------------------------------------------------------------------
Balance at December 31, 1994 1,192 4,864 21,832,532 (39,875,417) (1,000) (18,037,829)
Cumulative dividends on redeemable preferred stock -- -- (252,175) -- -- (252,175)
Allocation of net proceeds of debt offering to warrants -- -- 2,000,000 -- -- 2,000,000
Repurchase of common stock -- -- -- -- (25,000) (25,000)
Exercise of warrants 273 -- (173) -- -- 100
Loss for the year -- -- -- (2,239,663) -- (2,239,663)
---------------------------------------------------------------------------
Balance at December 31, 1995 1,465 4,864 23,580,184 (42,115,080) (26,000) (18,554,567)
Warrants issued with preferred stock facility -- -- 981,500 -- -- 981,500
Dividends on senior exchangeable redeemable preferred
stock -- -- (359,957) -- -- (359,957)
Merger related transactions:
Recapitalization and acquisition of common
shares by Capstar (1,455) (4,864) 32,092,400 -- 26,000 32,112,081
Redemption of preferred stock -- -- (1,101,235) -- -- (1,101,235)
Net loss for the period -- -- -- (17,907,946) -- (17,907,946)
---------------------------------------------------------------------------
Balance at December 31, 1996 $ 10 $ -- $ 55,192,892 $(60,023,026) $ -- $ (4,830,124)
===========================================================================
</TABLE>
See accompanying notes.
49
<PAGE> 50
Commodore Media, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1996 1995 1994
-------------------------------------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(17,907,946) $(2,239,663) $ (527,113)
Adjustments to reconcile net loss to net cash (used in)
provided by operating activities:
Merger related stock option compensation 12,731,587 -- --
Loss on extinguishment of debt -- 443,521 --
Depreciation and amortization 3,192,803 1,926,250 2,145,201
Noncash interest 4,231,815 2,673,829 219,910
Change in long-term incentive compensation (1,364,000) 79,000 2,180,000
Provision for uncollectible accounts receivable 593,158 556,137 468,155
Gain on disposition of assets -- 9,819 335,736
Net barter income (268,397) (184,300) (122,163)
Initial public offering and merger expenses 1,909,648 -- --
Changes in assets and liabilities, net of amounts acquired:
Increase in accounts receivable (3,217,224) (1,847,015) (1,509,195)
Increase in prepaid expenses and other current
assets (160,893) (88,787) (267,196)
(Decrease) increase in accounts payable and
accrued expenses (270,648) (158,855) 326,251
(Decrease) increase in accrued compensation (393,100) (230,645) 197,881
(Decrease) increase in accrued interest (284) 582,525 351,639
(Decrease) increase in accrued income taxes (57,506) (277,135) 261,541
-------------------------------------------
Total adjustments 16,926,959 3,484,344 4,587,760
-------------------------------------------
Net cash (used in) provided by operating activities (980,987) 1,244,681 4,060,647
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from redemption of note -- -- 405,000
Proceeds from sale of property, plant
and equipment -- -- 398,018
Repayment of stockholder loans 250,375 182,988 --
Purchase of property, plant and equipment (933,066) (320,980) (623,414)
Payments for acquisitions (41,900,000) (3,100,000) --
Deferred acquisition costs incurred (1,695,131) (417,020) (172,558)
Deposits on pending acquisitions (160,000) (525,000) --
Loans to employees -- (315,863) (57,500)
Other investing activities, net (402,528) 87,528 --
-------------------------------------------
Net cash used in investing activities (46,840,350) (4,408,347) (50,454)
</TABLE>
50
<PAGE> 51
Commodore Media, Inc. and Subsidiaries
Consolidated Statements of Cash Flows (continued)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1996 1995 1994
-------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
<S> <C>
Proceeds from issuance of Senior
Subordinated Notes and warrants $ -- $ 64,956,422 $ --
Proceeds from AT&T loan and security agreement 24,700,000 -- --
Cash capital contributions from Capstar 19,560,216 -- --
Net proceeds from issuance of senior exchangeable
preferred stock 9,822,520 -- --
Retirement of senior exchangeable preferred stock,
including accrued dividends (10,302,222) -- --
Proceeds from issuance of common stock -- 100 --
Payment of initial public offering and merger expenses (1,609,649) -- --
Repayment of amounts borrowed -- (39,014,833) (2,738,166)
Payment of financing related costs (860,748) (4,226,762) (104,245)
Redemption of preferred stock -- (8,665,835) --
Purchase of redeemable warrant -- (1,000,000) --
Repurchase of common stock -- (25,000) --
Principal payments on capital leases (12,422) (11,186) (12,389)
-------------------------------------------------
Net cash provided by (used in) financing activities 41,297,695 12,012,906 (2,854,800)
-------------------------------------------------
Net (decrease) increase in cash and short-term cash
investments (6,523,642) 8,849,240 1,155,393
Cash and short-term cash investments
at beginning of period 10,891,489 2,042,249 886,856
-------------------------------------------------
Cash and short-term cash investments
at end of period $ 4,367,847 $ 10,891,489 $ 2,042,249
=================================================
SUPPLEMENTARY CASH FLOW INFORMATION
Cash paid for interest $ 7,243,189 $ 4,474,789 $ 2,580,522
Cash paid for income taxes 110,945 417,769 38,209
</TABLE>
SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES
Asset acquisitions recorded in connection with barter transactions were
$189,982, $112,636 and $144,500 for the years ended December 31, 1996, 1995
and 1994, respectively.
See accompanying notes.
51
<PAGE> 52
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
December 31, 1996
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND MERGER AGREEMENT
ORGANIZATION AND NATURE OF BUSINESS
Commodore Media, Inc. and Subsidiaries (the "Company") is comprised of radio
stations that derive their revenue from local, regional and national
advertisers. The radio stations are located in the following markets:
Wilmington, Delaware; Westchester and Putnam Counties, New York; Huntington,
West Virginia--Ashland, Kentucky; Allentown--Bethlehem, Pennsylvania; Fort
Pierce--Stuart--Vero Beach, Florida; and Fairfield County, Connecticut. The
Company extends credit to its customers in the normal course of business
without requiring collateral.
MERGER AGREEMENT
On October 16, 1996, the Company was acquired pursuant to a merger agreement
dated June 21, 1996 with Capstar Broadcasting Partners, Inc. ("Capstar"), which
is an indirect subsidiary of Hicks, Muse, Tate & Furst Equity Fund III, L.P.
The holders of Class A Common Stock and Class B Common Stock (collectively, the
"Common Stock"), the holders of employee stock options and the holders of
warrants received $140 per share as consideration for the merger less, in the
case of option and warrant holders, the exercise price per share. In addition,
the Senior Exchangeable Redeemable Preferred Stock, Series A, $.01 par value
per share (the "Series A Preferred Stock") was redeemed, including all accrued
and unpaid dividends.
The Company recognized approximately $12,700,000 in stock option compensation
expense, and approximately $1,400,000 of merger related fees and expenses
during the year ended December 31, 1996. No adjustments to the carrying value
of the Company's assets and liabilities have been made to the financial
statements of the Company as of December 31, 1996 in connection with the
merger.
As a result of the merger and the change of control effected thereby, the
Company was obligated to satisfy the existing deferred compensation and
employment agreements with its former President and Chief Executive Officer and
its deferred compensation agreement with its current President and Chief
Executive Officer resulting in an additional charge to operations of
approximately $1,100,000.
52
<PAGE> 53
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND MERGER AGREEMENT (CONTINUED)
As a result of the merger, the Company did not proceed with its previously
announced intention to undertake an initial public equity offering and
therefore withdrew its registration statement filed on Form S-1 on May 17, 1996
with the Securities and Exchange Commission. Included in other expenses are
approximately $525,000 in various fees and expenses incurred in connection with
this filing.
Certain employees of the Company were granted options in November 1996 to
purchase 3,764,830 shares of common stock of Capstar at an exercise price of $1
per share, which approximates the fair value of the Capstar stock. Of this
amount, through January 31, 1997, options to purchase 795,880 shares had been
forfeited due to resignation. The options vest over a three year period and
expire ten years after grant.
BASIS OF PRESENTATION
The consolidated financial statements include the accounts of Commodore Media,
Inc. and all subsidiaries, after elimination of intercompany accounts and
transactions. Certain prior years' amounts have been reclassified to conform
with the current year's presentation.
SHORT-TERM CASH INVESTMENTS
The Company considers investments which have a remaining maturity of three
months or less at the time of purchase to be short-term cash investments. The
Company invests its excess cash in U.S. Treasury Bills.
INCOME TAXES
The Company accounts for income taxes in accordance with the liability method.
Under this method, deferred income taxes are provided for differences between
the book and tax bases of the Company's assets and liabilities.
53
<PAGE> 54
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND MERGER AGREEMENT (CONTINUED)
RISKS AND UNCERTAINTIES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Financial instruments which potentially subject the Company to concentration
risk consist primarily of trade receivables. The Company's revenue is
principally derived from local broadcast advertisers who are impacted by the
local economy.
The Company routinely assesses the financial strength of its customers and does
not require collateral or other security to support customer receivables.
Credit losses are provided for in the consolidated financial statements in the
form of an allowance for doubtful accounts.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost. Depreciation is provided on
the straight-line method based on the following estimated useful lives:
<TABLE>
<CAPTION>
CLASSIFICATION ESTIMATED LIFE (YEARS)
- --------------------------------------------------------------------------
<S> <C>
Land improvements 20
Buildings 20
Furniture, fixtures and equipment 7-10
Broadcasting and technical equipment 7-10
Towers and antennas 20
Music library 7
Leasehold improvements 10-20
Vehicles 3
</TABLE>
Expenditures for maintenance and repairs are charged to operations as incurred.
Expenditures for betterments and major renewals are capitalized and, therefore,
are included in property, plant and equipment.
54
<PAGE> 55
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND MERGER AGREEMENT (CONTINUED)
PROPERTY HELD UNDER CAPITAL LEASES
The Company is the lessee of office equipment under capital leases expiring in
various years through 2004. The assets and liabilities under capital leases are
recorded at the lower of the present value of the minimum lease payments or the
fair value of the asset. The assets are depreciated over their estimated
productive lives of seven to ten years.
REVENUE RECOGNITION
The Company recognizes revenue upon the airing of advertisements.
INTANGIBLE ASSETS
Intangible assets are being amortized by the straight-line method over the
following estimated useful lives:
<TABLE>
<CAPTION>
CLASSIFICATION ESTIMATED LIFE (YEARS)
- --------------------------------------------------------------------------
<S> <C>
FCC licenses and goodwill 40
Organization expenses 5
Network affiliation agreement 5
Covenant not to compete 5
Tower site lease 3
Contract rights 3
Software 3
Pre-sold advertising contracts 1
</TABLE>
Management reviews the appropriateness of the carrying value of goodwill of its
subsidiaries and the related amortization period quarterly based on their
anticipated undiscounted cash flows.
55
<PAGE> 56
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND MERGER AGREEMENT (CONTINUED)
DEFERRED CHARGES
Legal fees, bank loan closing costs and other expenses associated with debt
financing and the Recapitalization Transaction (see Note 2) are being amortized
using the effective interest rate method. Amortization of debt expense charged
to operations and included in interest expense amounted to $584,880, $384,912
and $219,910 for the years ended December 31, 1996, 1995 and 1994,
respectively.
ADVERTISING COSTS
The Company expenses advertising costs related to its radio station operations
as incurred. Advertising expense amounted to $730,990, $754,489 and $560,818
for the years ended December 31, 1996, 1995 and 1994, respectively.
BARTER TRANSACTIONS
The fair value of barter and trade-out transactions is included in broadcast
revenue and sales and promotion expense. Barter revenue is recorded when
advertisements are broadcast and barter expense is recorded when merchandise or
services are received. Barter transactions charged to operations were as
follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1996 1995 1994
-----------------------------------------------
<S> <C> <C> <C>
Trade revenue $ 4,254,207 $ 3,238,111 $ 2,473,002
Trade expense (3,985,810) (3,053,811) (2,350,839)
-----------------------------------------------
Net barter revenue $ 268,397 $ 184,300 $ 122,163
===============================================
</TABLE>
FINANCIAL STATEMENT PRESENTATION
Certain prior year financial statement items have been reclassified to conform
to the current year presentation.
56
<PAGE> 57
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
2. THE RECAPITALIZATION TRANSACTIONS
On April 21, 1995, the Company completed the offering of its 13-1/4% Senior
Subordinated Notes due 2003 ("Senior Subordinated Notes"). The net proceeds of
approximately $65,000,000 were used to retire existing senior indebtedness of
approximately $36,200,000, fund the Treasure Coast Acquisition for $3,100,000,
and repay the Hanson note and Radio Financial Partners ("RFP") note for an
aggregate amount of $2,400,000. In addition, the Company used $8,700,000 to
redeem its preferred stock, paid $1,900,000 in connection with the long-term
incentive compensation of its President and its Chief Operating Officer (see
Note 10), paid approximately $4,200,000 in related deferred fees of the
offering, and used the balance of $8,500,000 for general corporate purposes.
The Company converted all of its existing common stock for 486,373 shares of
its Class B Common Stock ("Class B") and 119,212 shares (including 85,524
treasury shares) of its Class A Common Stock ("Class A"). At the time of
conversion, the Company's President and its Chief Operating Officer purchased
27,369 shares and 6,319 shares, respectively, of Class A from the Chairman. In
addition, William A.M. Burden and Company, an affiliated entity, exercised its
option to acquire 27,314 shares of Class A from the Company. Each share of
Class B is entitled to eight votes and each share of Class A is entitled to one
vote. The consolidated financial statements have been retroactively adjusted
for this conversion.
57
<PAGE> 58
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
3. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment, at cost, consisted of the following:
<TABLE>
<CAPTION>
DECEMBER 31
1996 1995
-----------------------------
<S> <C> <C>
Land and land improvements $ 3,322,567 $ 2,813,139
Buildings 4,464,605 2,499,399
Furniture, fixtures and equipment 2,740,940 2,188,502
Broadcasting and technical equipment 8,921,484 5,907,905
Towers and antennas 4,519,489 3,401,300
Leasehold improvements 400,245 365,825
Property held under capital leases 104,497 81,497
Other 484,501 398,023
-----------------------------
24,958,328 17,655,590
Less accumulated depreciation and amortization (10,695,273) (9,575,547)
-----------------------------
Property, plant and equipment, net $ 14,263,055 $ 8,080,043
=============================
</TABLE>
Accumulated amortization of property held under capital leases as of December
31, 1996 and 1995 was $21,663 and $12,728, respectively. Depreciation as a
charge to income amounted to $1,133,392 in 1996, $831,656 in 1995 and $768,826
in 1994.
58
<PAGE> 59
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
4. OTHER INTANGIBLE ASSETS
Other intangible assets, at cost, consisted of the following:
<TABLE>
<CAPTION>
DECEMBER 31
1996 1995
-----------------------------
<S> <C> <C>
Covenant not to compete $ 1,481,000 $ 1,325,000
Deferred acquisition expenses 2,595,271 953,441
Pre-sold advertising contracts 103,642 103,642
Network affiliation agreement 303,169 260,000
Other 267,728 14,516
-----------------------------
4,750,810 2,656,599
Less accumulated amortization (1,786,189) (895,293)
-----------------------------
Other intangible assets, net $ 2,964,621 $ 1,761,306
=============================
</TABLE>
Amortization of the aforementioned intangible assets included as a charge to
income amounted to $890,896 for 1996, $506,447 for 1995 and $817,087 for 1994.
Amortization of FCC licenses and goodwill amounted to $1,168,515 for 1996,
$588,149 for 1995 and $559,304 in 1994.
59
<PAGE> 60
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
5. LONG-TERM DEBT
Long-term debt consisted of the following:
<TABLE>
<CAPTION>
DECEMBER 31
1996 1995
------------------------------
<S> <C> <C>
Senior Credit Facility--AT&T Commercial Finance Corporation,
collateralized by assets and capital stock of all subsidiaries,
interest at 3.5% over LIBOR, due December 31, 2002 $ 24,700,000 $ --
Senior Subordinated Notes due 2003, $76,808,000
principal, net of unamortized discount of $7,020,726
at December 31, 1996 and $10,546,661 at December 31,
1995 69,787,274 66,261,339
------------------------------
Total debt 94,487,274 66,261,339
Less current maturities (3,750,000) --
------------------------------
Long-term debt $ 90,737,274 $66,261,339
==============================
</TABLE>
AT&T SENIOR CREDIT FACILITY
On March 13, 1996, the Company entered into a Senior Credit Facility with AT&T
Commercial Finance Corporation ("AT&T") pursuant to which AT&T will make
available to the Company senior secured (i) revolving loans in an amount up to
$30,000,000 and (ii) accounts receivable loans in an amount which shall be the
lesser of (a) $5,000,000 or (b) 85% of the net book value of the accounts
receivable of the Company (the "Senior Credit Facility"). The indebtedness to
AT&T is collateralized by the tangible and intangible assets and the capital
stock of all the Company's subsidiaries. Interest is payable monthly at a rate
of 3.5% over LIBOR (9.09% at December 31, 1996) and principal amortization of
the revolving loans and accounts receivable loans begins June 1, 1998 and
November 30, 1997, respectively. At December 31, 1996, the Company had
additional available borrowings under the revolving and accounts receivable
loans of approximately $9,000,000 and $1,300,000, respectively. The Company
pays a commitment fee of .25% every six months on the unused commitment.
60
<PAGE> 61
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
5. LONG-TERM DEBT (CONTINUED)
SENIOR SUBORDINATED NOTES
The Senior Subordinated Notes bear cash interest at a rate of 7-1/2% per annum
on the principal amount until May 1, 1998 then at a rate of 13-1/4% per annum
until maturity, with interest payment dates on May 1 and November 1. The notes
may be redeemed at the option of the Company at any time on or after May 1,
1999 at redemption prices specified in the indenture. The terms of the Senior
Subordinated Notes contain various covenants for the benefit of the holders
that, among other things, restrict the ability of the Company to incur
additional indebtedness, pay dividends and make certain investments. The notes,
excluding the notes that were held for the benefit of the former President (see
Note 10), were issued with detachable warrants to purchase 75,500 shares of
Class A Common Stock at an exercise price of $.01 per warrant. The warrant
holders at the time of the merger received $140 in cash for each warrant. The
Company estimated the fair market value of the warrants to be $2,000,000 as of
the date of issuance and allocated this amount out of the net proceeds of the
debt offering to paid-in capital.
Aggregate maturities of long-term debt due within the next five years ending
December 31 are as follows:
<TABLE>
<S> <C>
1997 $ 3,750,000
1998 -
1999 -
2000 1,825,000
2001 5,625,000
Thereafter 83,287,274
---------------
$ 94,487,274
===============
</TABLE>
In connection with the Recapitalization Transactions, the Company wrote off the
balance of the unamortized deferred financing costs on its retired debt of
$443,521. Inasmuch as the Company has no current federal taxable income and has
fully reserved for its net deferred tax assets, there was no tax effect
attributable to this extraordinary item.
61
<PAGE> 62
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
6. PREFERRED STOCK
SENIOR EXCHANGEABLE REDEEMABLE PREFERRED STOCK
On May 1, 1996, the Company entered into a Securities Purchase Agreement with
CIBC WG Argosy Merchant Fund 2, LLC ("CIBC Merchant Fund"), pursuant to which
the CIBC Merchant Fund agreed to purchase from the Company, if and when
requested by the Company, up to an aggregate liquidation value of $12,500,000
of Senior Exchangeable Redeemable Preferred Stock, Series A, $.01 par value per
share, of the Company in such amounts as the Company requested (the "Preferred
Stock Facility"). In connection with the Stamford Acquisition on May 30, 1996
and the Florida Acquisition on May 31, 1996 (see Note 7), the Company issued
5,700 shares and 4,300 shares, respectively, of Preferred Stock for an
aggregate purchase price of $10,000,000. The Preferred Stock accrued cash
dividends at the rate of 8% per annum and was redeemed, including accrued
dividends, in connection with the merger on October 16, 1996. In connection
with the Preferred Stock Facility, the Company issued to the CIBC Merchant Fund
a warrant to purchase 7,550 shares of the Company's Class A Common Stock, at an
exercise price of $.01 per warrant, which were valued in the aggregate at the
date of issue at $981,500. This warrant was redeemed in connection with the
merger for $140 per share less the exercise price.
8.87% CUMULATIVE REDEEMABLE PREFERRED STOCK
On December 28, 1993, RFP, a related entity (see Note 11), converted $7,723,000
of outstanding debt and accrued interest into 10,000 shares of the Company's
newly issued 8.87% cumulative redeemable preferred stock ("Redeemable Preferred
Stock"). The Company redeemed all outstanding shares of the preferred stock as
part of the Recapitalization Transactions on April 21, 1995; the total
liquidation value as of the date of redemption was $8,665,835 which included
$942,835 in accumulated dividends.
7. ACQUISITIONS OF BUSINESSES AND JOINT OPERATING AGREEMENTS
PENDING ACQUISITIONS
On September 26, 1996, the Company entered into an Asset Purchase Agreement
with Indian River Shores Partners, L.C. to purchase certain defined assets of
radio station WOSN-FM located in the Fort Pierce-Stuart-Vero Beach, Florida
market for a total purchase price of
62
<PAGE> 63
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
7. ACQUISITIONS OF BUSINESSES AND JOINT OPERATING AGREEMENTS (CONTINUED)
$1,600,000. The Company anticipates that this transaction will close in the
first quarter of 1997 with funding provided by available revolving credit
borrowings under the AT&T Senior Credit Agreement.
CONSUMMATED ACQUISITIONS
On October 16, 1996, the Company purchased certain defined assets of radio
stations WKEE-FM and WKEE-AM in Huntington, West Virginia, WZZW-AM in Milton,
West Virginia, WBVB-FM in Coal Grove, Ohio and WIRO-AM in Ironton, Ohio from
Adventure Communications, Inc. for $7,765,000 and certain defined assets of
WFXN-FM in Milton, West Virginia and WMLV-FM in Ironton, Ohio for $4,235,000
(collectively, the "Huntington Acquisition"). The transactions were funded with
borrowings from the AT&T Senior Credit Facility and with a capital contribution
from Capstar. The Company operated these stations under an LMA agreement
effective April 1996 until the purchase date. In addition, the Company has an
option to purchase WHRD-AM in Huntington, West Virginia and operates the
station under an LMA arrangement.
On May 31, 1996, the Company purchased certain defined assets of radio stations
WBBE-FM (formerly WKQS-FM), WAVW-FM and WAXE-AM in the Fort Pierce-Stuart-Vero
Beach, Florida market from Media VI for $8,000,000 (the "Florida Acquisition").
The transaction was funded with borrowings from the AT&T Senior Credit Facility
and funds from the Preferred Stock Facility. The Company operated these
stations under a Joint Sales Agreement from February 1996 until the purchase
date.
On May 30, 1996, the Company purchased certain defined assets of radio stations
WKHL-FM and WSTC-AM in Stamford, Connecticut from Q Broadcasting, Inc. for
$9,500,000 (the "Stamford Acquisition"). The transaction was financed with
borrowings from the AT&T Senior Credit Facility and funds from the Preferred
Stock Facility.
On March 27, 1996, the Company purchased (i) certain defined assets of radio
stations WZZN-FM in Mount Kisco, New York, WAXB-FM in Patterson, New York and
WPUT-AM in Brewster, New York from Hudson Valley Growth, L.P. for $4,950,000
and (ii) all of the issued and outstanding common stock of Danbury
Broadcasting, Inc., owner of WRKI-FM, and WINE-AM in Brookfield, Connecticut,
plus certain real property for $9,950,000.
63
<PAGE> 64
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
7. ACQUISITIONS OF BUSINESSES AND JOINT OPERATING AGREEMENTS (CONTINUED)
The transaction was financed with the Company's existing cash and borrowings
under its senior credit facility with AT&T. The Company operated these stations
under LMA agreements from October 1995 until the purchase date.
On June 27, 1995, the Company purchased the assets (excluding cash and accounts
receivable) and broadcasting license of radio broadcast station WQOL-FM in Vero
Beach, Florida (Treasure Coast Acquisition) for a total purchase price of
$3,150,000.
On December 28, 1993, the Company purchased the assets (excluding cash and
accounts receivable) and broadcasting license of radio broadcast station
WZZO-FM in Allentown, Pennsylvania, for a total purchase price of $9,375,000.
All of the transactions described above were accounted for under the purchase
method of accounting. The total purchase price of the transactions described
above, of approximately $56.9 million has been allocated as follows: (1)
approximately $7,700,000 to property, plant and equipment, (2) approximately
$50,900,000 to FCC licenses and goodwill and other intangible assets and (3)
approximately $1,700,000 to deferred income taxes. Unaudited pro forma results
of operations for the Company as if the aforementioned acquisitions had been
consummated on January 1, 1995 are as follows (in thousands):
<TABLE>
<CAPTION>
1996 1995
-----------------------
<S> <C> <C>
Net revenue $ 44,474 $ 42,467
Net loss before extraordinary item (18,540) (3,756)
Net loss (18,540) (4,199)
</TABLE>
64
<PAGE> 65
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
7. ACQUISITIONS OF BUSINESSES AND JOINT OPERATING AGREEMENTS (CONTINUED)
LOCAL MARKETING AND JOINT SALES AGREEMENTS
The Company has entered into various Local Marketing Agreements ("LMA") and
Joint Sales Agreements ("JSA"). While each agreement is unique in its terms and
conditions, generally under an LMA and JSA the brokering station purchases
substantially all of the commercial time available on the brokered station and
provides promotional and sales related services. Under an LMA, the brokering
station may also provide the programming; a JSA requires the licensee to
continue all of the programming. The brokering station pays a fee to the
brokered station for the services provided based upon a flat monthly amount,
and/or an amount contingent on the net revenue or profit as calculated in the
agreement. As the brokering station, the Company currently has LMAs or JSAs
with WKAP-AM, Allentown, PA, WPAW-FM, Vero Beach, FL and WHRD-AM in Huntington,
WV. The Company has an option to purchase WPAW-FM for $1,200,000 which it may
exercise during the 29 month period beginning August 1995 and an option to
purchase WHRD-AM for $5,000. The Company has also operated various stations
that were under contract to purchase under LMA or JSA agreements (see Note 7).
8. INCOME TAXES
The Company has recorded a provision for income taxes as follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1996 1995 1994
------------------------------------
<S> <C> <C> <C>
Current:
Federal $ -- $ -- $ 70,400
State and local 132,476 140,634 229,600
Deferred:
Federal -- -- --
State and local -- -- --
------------------------------------
Total $132,476 $140,634 $300,000
====================================
</TABLE>
65
<PAGE> 66
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
8. INCOME TAXES (CONTINUED)
The Company did not record a federal tax benefit on the taxable loss for the
years ended December 31, 1996 and 1995 since it was not assured that it could
realize a benefit for such loss in the future. During 1994, the Company
utilized approximately $2,500,000 of Federal net operating losses to offset
current taxable income. Since the valuation allowance remained at 100% at the
end of the year, there was no deferred tax effect on 1994 earnings. The Company
recorded a provision for federal alternative minimum tax in 1994 because net
operating loss carryforwards may be used to offset only 90% of a corporation's
alternative minimum taxable income.
The Company received Internal Revenue Service approval and changed its tax
method of accounting for FCC licenses for the tax year ended December 31, 1995.
The aggregate amount of cumulative amortization that will be deductible ratably
over six taxable years for tax purposes is approximately $12,130,000.
The reconciliation of income tax computed at the U.S. federal statutory rates
to effective income tax expense is as follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1996 1995 1994
-------------------------------------------
<S> <C> <C> <C>
Provision (benefit) at statutory rate $(6,221,415) $(734,695) $ (79,400)
State and local taxes 132,476 140,634 229,600
Nondeductible expense 42,700 8,286 36,575
Increase in valuation allowance, net of
rate changes 6,178,715 726,409 42,825
Alternative minimum tax -- -- 70,400
-------------------------------------------
Total $ 132,476 $ 140,634 $ 300,000
===========================================
</TABLE>
66
<PAGE> 67
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
8. INCOME TAXES (CONTINUED)
Deferred income taxes reflect the net tax effect of temporary differences
between the carrying amount of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. The approximate effect
of temporary differences were as follows:
<TABLE>
<CAPTION>
DECEMBER 31
1996 1995
--------------------------------
<S> <C> <C>
Deferred tax assets:
Allowance for bad debts $ 370,800 $ 312,100
Deferred compensation 126,400 1,244,100
Unamortized discount on Senior
Subordinated Notes 3,015,500 959,200
Intangibles -- 290,300
Depreciation -- 76,460
Other 78,200 --
Net operating loss carryforwards 21,679,700 12,405,800
--------------------------------
Total deferred tax assets 25,270,600 15,287,960
Deferred tax liabilities:
Intangibles (4,920,900) --
Depreciation (516,500) (537,260)
Other -- (4,800)
--------------------------------
Total deferred tax liabilities (5,437,400) (542,060)
--------------------------------
Net deferred tax asset 19,833,200 14,745,900
Less valuation allowance (21,533,200) (14,745,900)
--------------------------------
Net deferred tax liability, net of allowance $ (1,700,000) $ --
================================
</TABLE>
67
<PAGE> 68
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
8. INCOME TAXES (CONTINUED)
The Company has provided a valuation allowance equivalent to its net deferred
tax asset in 1996, 1995 and 1994 as the past history of the Company makes the
realization of taxable income in the future years uncertain. As of December 31,
1996, the Company had net operating loss carryforwards of approximately
$52,100,000 for federal purposes that expire in the years 1999 through 2011,
and $36,200,000 for state purposes that expire in the years 1997 to 2011. The
Company also has available as of December 31, 1996 $6,065,000 of carryforward
deductions related to the change in accounting for FCC licenses that will be
deductible in the tax years 1997 to 1999. As a result of the merger transaction
described in Note 1, the Company's net operating loss deduction will be subject
to an annual limitation under the Internal Revenue Code Section 382.
9. COMMITMENTS
LEASE COMMITMENTS
The principal types of property leased by the Company and its subsidiaries are
office space, tower, real estate related to tower sites, office equipment and
transmitting equipment.
Total rent expense for the Company was approximately $548,000, $332,000 and
$306,400 for the years ended December 31, 1996, 1995 and 1994, respectively.
The minimum rental commitments of the Company, under all noncancellable
operating leases, are set forth below:
<TABLE>
<CAPTION>
AMOUNT
-------------
<S> <C>
Year:
1997 $ 526,183
1998 499,447
1999 422,837
2000 232,872
2001 233,691
Thereafter 682,209
-------------
Total minimum lease payments $ 2,597,239
=============
</TABLE>
68
<PAGE> 69
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
9. COMMITMENTS (CONTINUED)
OTHER COMMITMENTS
The Company has employment agreements with key executives under which the
executives are paid a base salary and annual incentives based on broadcast cash
flow and EBITDA, as defined in the agreements.
10. LONG-TERM INCENTIVE COMPENSATION AND EMPLOYMENT AGREEMENTS
On January 1, 1994, the Company entered into an agreement with Mr. Bruce A.
Friedman its President and Chief Executive Officer under which he would be
employed in that capacity through 1996 and provided for annual salary
requirements and bonuses, and a Long-Term Incentive Payment ("LTIP"). The LTIP
was based on a formula derived from the Company's net equity value, as defined.
A fair value amount of $1,750,000 was charged to income as long-term incentive
compensation in 1994 relating to the LTIP. On April 21, 1995, Mr. Friedman's
employment agreement was amended and restated. In lieu of the LTIP, the Company
paid Mr. Friedman $1,500,000 in cash, issued $1,308,000 principal ($1,125,000
net of discount) of the Company's Senior Subordinated Notes to a trust for his
benefit and agreed to provide $1,500,000 in deferred compensation which accrued
interest at a rate of 7% and was payable in 2003. The Company recorded the
deferred compensation on April 21, 1995 at its calculated net present value of
$921,000. The aggregate effect of the employment agreement restructuring was to
charge $1,817,750 to long-term incentive compensation expense during 1995. In
addition, Mr. Friedman's amended employment agreement extended his date of
employment through April 30, 1998, granted stock options to him to acquire
28,313 shares of Class A Common Stock at an exercise price of $45 per share and
provided for annual bonuses based upon specific operating results of the
Company.
On April 21, 1995, the Company amended its existing employment agreement with
Mr. James T. Shea, its Chief Operating Officer. The prior employment agreement
provided for a long-term incentive based upon the increase in certain station
values. As of December 31, 1994, $430,000 had been accrued as long-term
incentive compensation. The amended employment agreement provided for a cash
payment of $400,000 on April 21, 1995 and deferred compensation of $346,000
which accrued interest at a rate of 7% and was payable in 2003. The Company
recorded the deferred compensation on April 21, 1995 at its calculated net
present value of $213,000. The aggregate effect of the employment agreement
restructuring was to charge $188,800 to long-term incentive compensation
expense during
69
<PAGE> 70
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
10. LONG-TERM INCENTIVE COMPENSATION AND EMPLOYMENT AGREEMENTS (CONTINUED)
1995. In addition, the amended employment agreement extended the date of
employment through April 30, 1999, granted stock options to acquire 28,313
shares of Class A Common Stock at an exercise price of $45 per share and
provided for annual bonuses based upon specific operating results of the
Company.
As a result of the merger and the change of control effected thereby, the
Company was obligated to satisfy the existing deferred compensation and
employment agreements with its President and Chief Executive Officer and its
deferred compensation agreement with its Chief Operating Officer, resulting in
an additional charge to operations of approximately $1.1 million. Furthermore,
all stock options for the aforementioned officers, as well as for all holders,
were redeemed at $140 per share, less the exercise price of $45 per share at
the time of the merger. The Company's President and Chief Executive Officer
resigned his position effective October 16, 1996 as required by the Merger
Agreement. Mr. James T. Shea was appointed as President on October 16, 1996.
11. RELATED PARTY TRANSACTIONS
During the years ended December 31, 1996 and 1995, the Company paid the former
majority stockholder a salary of approximately $185,500 and $175,000,
respectively. In addition, the former majority stockholder repaid an
outstanding loan of $182,988, of which $65,488 was advanced in the year ended
December 31, 1995; the former majority stockholder owed the Company $117,500 as
of December 31, 1994 which was reflected in other current assets.
During May 1995, the Company loaned approximately $250,000 to certain executive
officers as evidenced by 7% promissory notes that mature in 2001, with all
accrued interest and principal due on the maturity date. The total amount owed
to the Company at December 31, 1995 is $261,329, which is included in
noncurrent assets. These loans plus all accrued interest were repaid in October
1996.
In connection with the debt restructuring described above, on December 28,
1993, the Company granted a warrant to an affiliate to purchase 4.99% of its
common stock at an exercise price of $100, on a fully diluted basis. The
warrant was exercised during 1995.
70
<PAGE> 71
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
12. STOCK OPTION AND 401(k) PLANS
On April 21, 1995, the Company adopted a stock option plan which provides for
the granting of incentive stock options and nonqualified stock options to
executives and key employees (the "Plan"). The options were exercisable at a
price equal to the fair market value on the date of grant. On October 16, 1996,
all outstanding options were redeemed at $140 per share less their exercise
price of $45 per option.
The following table summarizes the Plan's transactions for the years ended
December 31, 1996 and 1995:
<TABLE>
<CAPTION>
1996 1995
-----------------------
<S> <C>
Outstanding options, beginning of year 96,670 --
Granted 35,455 96,670
Cancelled or expired -- --
Exercised (132,125) --
-----------------------
Outstanding options, end of year -- 96,670
=======================
Average price of options exercised $ 45 $ --
Weighted average exercise price, end of year $ -- $ 45
Options exercisable, end of year -- 96,670
Options available for future grant -- 35,455
</TABLE>
The Company applies Accounting Principles Board Opinion No. 25, Accounting for
Stock Issued to Employees, and related interpretations in accounting for its
Plan. Accordingly, no compensation expense has been recognized for its Plan.
Had compensation cost for the Plan been determined based upon the fair value at
the grant date for awards under the Plan consistent with the methodology
prescribed under Statement of Financial Accounting Standards No. 123 ("FASB No.
123"), Accounting for Stock-Based Compensation, the Company's net loss would
have been decreased by $11,520,499 and increased by $176,225 for the years
ended December 31, 1996 and 1995, respectively, using the minimum valuation
method option-pricing model with the following assumptions: dividend yield of
0.00%, risk-free interest rate of 6.64% and an expected life of four years. For
purposes of FASB No. 123
71
<PAGE> 72
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
12. STOCK OPTION AND 401(k) PLANS (CONTINUED)
pro forma disclosures, the estimated fair value of the options is amortized to
expense over the option's vesting period. Therefore, the impact on pro forma
results of operations in 1996 and 1995 may not be representative of the impact
in future periods should additional options be granted.
During 1995, the Company established a 401(K) Plan for the benefit of all
eligible employees. Eligible participants under this plan are defined as all
full-time employees with one year of service. All eligible participants may
elect to contribute a portion of their compensation to the plan subject to
Internal Revenue Service limitations. The Company may make discretionary
matching contributions to the plan, subject to board approval; no contributions
were made during the plan years ended December 31, 1996 and 1995.
13. LEGAL PROCEEDINGS
The Company is involved in various legal proceedings from time to time in the
normal course of business. In management's opinion, the litigation in which the
Company is currently involved, individually and in the aggregate, is not
material to the Company's financial condition or results of operations.
14. SUBSEQUENT EVENTS (UNAUDITED)
CONSUMMATED ACQUISITION
In February 1997, the Company acquired Osborn Communications Corporation
("Osborn") and will complete certain pending acquisitions of Osborn for a
purchase price of $127.7 million, including the repayment of outstanding
indebtedness of Osborn. The purchase price includes $113.0 million for the 18
stations that were owned and operated or to which services were provided by
Osborn and $25.7 million for the purchase of five radio stations in Huntsville
and Tuscaloosa, Alabama (the "Osborn Add-on Acquisitions") and excludes $11.0
million to be received by the Company upon the disposition of three radio
stations in Ft. Myers, Florida (the "Osborn Disposition"). The Osborn
Acquisition was funded from the proceeds of the issuance of the Company's common
stock to Capstar for an aggregate purchase price of $157,400,000. The Osborn
Add-on Acquisitions are expected to close in April and May 1997 and the Osborn
Disposition is expected to close in April 1997.
72
<PAGE> 73
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
14. SUBSEQUENT EVENTS (UNAUDITED) (CONTINUED)
PENDING ACQUISITIONS
In September 1996, the Company agreed to acquire substantially all the assets
of Indian River Shores Partners, L.C. ("Indian River") used in the operation of
Indian River's FM radio station in the Ft. Pierce-Stuart-Vero Beach, Florida
market (the "Indian River Acquisition"). The purchase price of the Indian River
Acquisition will equal approximately $1.6 million payable in cash.
In October 1996, a subsidiary of Capstar ("Capstar-Florida"), agreed to acquire
substantially all of the assets of City Broadcasting Co., Inc. ("City") (the
"City Acquisition"). The purchase price of the acquisition will equal
approximately $3.0 million payable in cash. City owns and operates two radio
stations (one FM and one AM) in the Melbourne-Titusville-Cocoa, Florida market.
In October 1996, Capstar-Florida agreed to acquire substantially all of the
assets of EZY Com, Inc. ("EZY") (the "EZY Acquisition"). The purchase price
of the acquisition will equal approximately $5.0 million payable in cash.
EZY owns and operates two radio stations (one FM and one AM) in the
Melbourne-Titusville-Cocoa, Florida market.
In October 1996, Capstar-Florida agreed to acquire substantially all of the
assets of Roper Broadcasting, Inc. ("Roper") (the "Roper Acquisition" and
collectively with the City Acquisition and the EZY Acquisition, the "Space
Coast Acquisitions"). The purchase price of the acquisition will equal
approximately $4.0 million payable in cash. Roper owns and operates one FM
radio station in the Melbourne-Titusville-Cocoa, Florida market.
The Company anticipates that the Capstar-Florida Acquisitions will be
consummated in April 1997, immediately prior to which the acquisition agreement
for each of the Space Coast Acquisitions will be assigned to the Company.
73
<PAGE> 74
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
14. SUBSEQUENT EVENTS (UNAUDITED) (CONTINUED)
Under the terms of several acquisition agreements, each dated December 1996,
Benchmark Communications Radio Limited Partnership, L.P. ("Benchmark") will
become an indirect wholly-owned subsidiary of the Company through a series of
mergers and stock purchases (the "Benchmark Acquisition"). The purchase price of
the Benchmark Acquisition will equal approximately $173.4 million. Benchmark
owns and operates 27 radio stations (17 FM and 10 AM), has agreed to acquire two
radio stations in the Montgomery, Alabama market (the "Benchmark Montgomery
Acquisition"). Those stations are located in 11 markets in the Southeastern
United States, including Dover, Delaware; Salisbury-Ocean City, Maryland;
Montgomery, Alabama; Shreveport, Louisiana; Jackson, Mississippi; Statesville,
North Carolina; Columbia, South Carolina; Greenville, South Carolina; Roanoke,
Lynchburg and Winchester, Virginia markets. The Company anticipates that the
Benchmark Acquisition will be consummated in June 1997.
The obligation of Benchmark to consummate the Benchmark Acquisition is subject
to Federal Communication Commission (" FCC") approval.
In November 1996, Benchmark agreed to acquire substantially all of the assets
of Capital Communications utilized in the operations of Capital Communications'
three FM radio stations in the Montgomery, Alabama market. The purchase price
of the Benchmark Montgomery Acquisition will equal approximately $19.9 million
payable in cash by Benchmark. An affiliate of Capstar will loan Benchmark
sufficient funds to consummate the Benchmark Montgomery Acquisition.
74
<PAGE> 75
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
14. SUBSEQUENT EVENTS (UNAUDITED) (CONTINUED)
In December 1996, a subsidiary of Capstar ("Pacific Star"), agreed to acquire
substantially all of the assets of Community Pacific (the "Community Pacific
Acquisition"). The purchase price of the Community Pacific Acquisition will
equal approximately $35.0 million payable in cash. Community Pacific owns and
operates 11 radio stations (six FM and five AM) in four markets located in
Anchorage, Alaska, Modesto and Stockton, California and Des Moines, Iowa. The
Company anticipates that the Community Pacific Acquisition will be consummated
in November 1997, prior to which time the acquisition agreement will be assigned
or otherwise transferred to the Company.
In January 1997, a subsidiary of Capstar ("Madison Acquisition Co.") agreed to
acquire substantially all of the assets of The Madison Radio Group ("Madison")
(the "Madison Acquisition"). The purchase price of the Madison Acquisition will
equal approximately $38.8 million payable in cash. Madison owns and operates
six radio stations (four FM and two AM) in Madison, Wisconsin. The acquisition
is pending FCC approval. The Company anticipates that the Madison Acquisition
will be consummated in October 1997, prior to which time the acquisition
agreement will be assigned or otherwise transferred to the Company.
In January 1997, Pacific Star agreed to acquire substantially all of the assets
of Commonwealth (the "Commonwealth Acquisition"). The purchase price of the
Commonwealth Acquisition will equal approximately $5.3 million payable in cash.
Commonwealth owns and operates three radio stations (two FM and one AM) in Yuma,
Arizona. The acquisition is pending FCC approval. The Company anticipates that
the Commonwealth Acquisition will be consummated in October 1997, prior to which
time the acquisition agreement will be assigned or otherwise transferred to the
Company.
In January 1997, Madison Acquisition Co. agreed to acquire substantially all of
the assets of Cavalier Communications, L.P. ("Cavalier") (the "Cavalier
Acquisition"). The purchase price of the Cavalier Acquisition will equal
approximately $8.3 million payable in cash. Cavalier owns and operates five
radio stations (four FM and one AM) in the Roanoke and Lynchburg, Virginia
markets. The acquisition is pending FCC approval. The Company anticipates that
the Cavalier Acquisition will be consummated in October 1997, prior to which
time the acquisition agreement will be assigned or otherwise transferred to the
Company.
75
<PAGE> 76
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
14. SUBSEQUENT EVENTS (UNAUDITED) (CONTINUED)
In February 1997, Pacific Star agreed to acquire substantially all of the assets
of COMCO Broadcasting, Inc. ("COMCO") (the "COMCO Acquisition"). The purchase
price of the COMCO Acquisition will equal approximately $6.7 million payable in
cash. COMCO owns and operates six radio stations (four FM and two AM) in the
Anchorage and Fairbanks, Alaska markets. The acquisition is pending FCC
approval. The Company anticipates that the COMCO Acquisition will be consummated
in October 1997, prior to which time the acquisition agreement will be assigned
or otherwise transferred to the Company.
Upon consummation of the Community Pacific Acquisition and the COMCO
Acquisition, the Company will own and operate seven radio stations (four FM and
three AM) in the Anchorage, Alaska market, which number exceeds the multiple
station ownership limitations under the Communications Act. Accordingly, the
Company has sought permission from the FCC to consummate both the Community
Pacific Acquisition and the COMCO Acquisition provided that the Company agrees
to sell radio station KASH-AM in Anchorage, Alaska within 18 months of the date
on which the Community Pacific Acquisition is consummated. The Company would be
in compliance with the ownership limitations of the Communications Act in the
Anchorage, Alaska market once it disposes of KASH-AM. No assurances can be given
that the FCC will grant permission to the Company to consummate both the
Community Pacific Acquisition and the COMCO Acquisition and dispose of KASH-AM,
or if the FCC grants such permission, that the Company will be able to sell
KASH-AM.
In March 1997, WNOK Acquisition Company, Inc., a subsidiary of the Company,
agreed to acquire substantially all of the assets of Emerald City Radio
Partners, L.P. ("Emerald City") (the "Emerald City Acquisition"). The purchase
price of the Emerald City Acquisition will equal approximately $14.9 million
payable in cash. Emerald City owns and operates three radio stations (two FM
and one AM) in the Columbia, South Carolina market. The acquisition is pending
FCC approval. The Company anticipates that the Emerald City Acquisition will be
consummated in October 1997.
76
<PAGE> 77
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
14. SUBSEQUENT EVENTS (UNAUDITED) (CONTINUED)
Upon consummation of the Emerald City Acquisition, the Company would own and
operate eight radio stations (five FM and three AM) in the Columbia, South
Carolina market, which number exceeds the multiple station ownership
limitations under the Communications Act. Accordingly, the Company expects to
assign WNOK Acquisition Co.'s right to acquire two of Emerald City's radio
stations on or before the date on which the Company acquires Emerald City's
third radio station. No assurances can be given that the Company will be able
to find another buyer to acquire such stations, or that if another buyer is
found, the right to acquire such stations will be assigned to the other buyer
on terms favorable to the Company.
POSSIBLE ACQUISITIONS
The Company has entered into four separate letters of intent to acquire
substantially all of the assets of the respective potential sellers used or
useful in the operations of each such seller's radio stations, each of which is
subject to the ability of the Company to enter into a definitive agreement to
acquire such assets. No assurances can be given that definitive agreements will
be entered into to acquire such assets or that, if entered into, the terms
thereof will be favorable to the Company. The Company is also currently
evaluating certain other potential acquisition opportunities.
77
<PAGE> 78
Commodore Media, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (continued)
14. SUBSEQUENT EVENTS (UNAUDITED) (CONTINUED)
REPAYMENT OF SENIOR CREDIT FACILITY
On February 20, 1997, in connection with Capstar's 12 3/4% Senior Discount Note
Private Placement Offering, the company repaid its existing Senior Credit
Facility with AT&T. This repayment resulted in an extraordinary charge of $1.3
million being recorded in the Company's consolidated statement of operations.
NEW CREDIT FACILITY
On February 20, 1997, the Company entered into a credit facility (the "New
Credit Facility") with various banks and Bankers Trust Company, as
administrative agent, which consists of a $50.0 million revolving loan
facility. The indebtedness under the New Credit Facility is secured by a first
priority perfected pledge of substantially all of Capstar's assets, including,
without limitation, the capital stock of the subsidiaries of Capstar, and is
guaranteed by Capstar and all of the direct and indirect subsidiaries of
Capstar (other than the Company). Borrowings under the New Credit Facility
bear interest at floating rates and require interest payments on varying dates
depending on the interest rate option selected by the Company. All loans
outstanding under the New Credit Facility will mature in 2002. No balance was
outstanding under the New Credit Facility as of March 20, 1997.
CREDIT AGREEMENT
In March 1997, the Company entered into a $13.5 million Credit Agreement with
Emerald City (the "Credit Agreement"). In accordance with the Credit Agreement,
the Company loaned Emerald City $13.5 million (the "Loan") which is to be
repaid in two installments. The first installment is to be a payment of
principal of the Loan equal to the purchase price under the Asset Purchase
Agreement for the radio station WNOK-FM, together with any accrued and unpaid
interest thereon, with the second installment to consist of the remaining
principal balance of the Loan, together with any accrued and unpaid interest
thereon, due and payable on the Maturity Date (as defined in the Credit
Agreement).
78
<PAGE> 79
COMMODORE MEDIA, INC.
SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS
<TABLE>
<CAPTION>
Additions
--------------------------- Deductions
Balance at Charged to Charged to ---------- Balance
Beginning Costs and Other Direct at End
Description of Period Expenses(1) Accounts(2) Write-Offs of Period
----------- ----------- ----------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Allowance for doubtful accounts 453,782 468,155 -- (389,706) 532,231
12/31/94 . . . . . . . . . . . . .
Allowance for doubtful accounts 532,231 556,137 -- (388,032) 700,336
12/31/95 . . . . . . . . . . . . .
Allowance for doubtful accounts 700,336 487,488 -- (325,547) 862,277
10/16/96 . . . . . . . . . . . . .
Allowance for doubtful accounts 862,277 105,670 -- (129,866) 838,081
12/31/96 . . . . . . . . . . . . .
</TABLE>
79
<PAGE> 80
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The following table sets forth the name, age and position with the
Company of each person who is a director and/or executive officer of the
Company as of March 15, 1997:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<S> <C> <C>
R. Steven Hicks 47 Chairman of the Board and Chief Executive Officer
James T. Shea, Jr. 44 President
Eric C. Neuman 52 Vice President and Director
William S. Banowsky, Jr. 35 Vice President and Assistant Secretary
Paul D. Stone 36 Vice President and Assistant Secretary
James J. Sullivan 40 Chief Financial Officer, Treasurer and Secretary
Frank D. Osborn 49 President and Chief Executive Officer of Osborn
Thomas O. Hicks 51 Director
Lawrence D. Stuart, Jr. 52 Director
</TABLE>
R. Steven Hicks has served as the Chairman of the Board, Chief
Executive Officer and as a director of the Company since October 1996. Mr.
Hicks has served as the Chairman of the Board, President, Chief Executive
Officer and as a director of Capstar since its inception in October 1996. Mr.
Hicks has also served as Chairman of the Board and Chief Executive Officer of
GulfStar since January 1987. From November 1993 to May 1996, he was President
and Chief Executive Officer of SFX, a publicly traded radio broadcasting
company. Mr. Hicks is a 30-year veteran of the radio broadcasting industry,
including 18 years as a station owner. Mr. Hicks is the brother of Thomas O.
Hicks.
James T. Shea, Jr. is President of the Company and has served in such
position since October 1996. Mr. Shea joined the Company as the President of
its MidAtlantic Region in March 1992. He joined Wilks-Schwartz as Vice
President, General Manager, and Partner of WKRZ, Wilkes Barre, Pennsylvania in
1980, and became Vice President, General Manager and Partner of WQQQ/WEEX,
Allentown, Pennsylvania in 1984, was promoted to Executive Vice President and
Partner in 1986 and served in such capacity until 1992. Prior to serving as
President of the Company, Mr. Shea served as Chief Operating Officer of the
Company from January 1995 to October 1996.
Eric C. Neuman has served as Vice President and as a director of the
Company since October 1996. Mr. Neuman has served as Executive Vice President
and as a director of Capstar since its inception in October 1996. Mr. Neuman
has also served as an officer of Hicks Muse since 1993 and as a Senior Vice
President thereof since 1996. Before joining Hicks Muse, Mr. Neuman served for
eight years as Managing General Partner of Communications Partners, Ltd., a
Dallas- based private investment firm. Mr. Neuman has served as a director of
Chancellor Broadcasting Company since 1996.
William S. Banowsky, Jr. has served as a Vice President and Assistant
Secretary of the Company since February 10, 1997. Mr. Banowsky has served as
an Executive Vice President and the General Counsel of Capstar since January
1997. Mr. Banowsky was an attorney with Snell, Banowsky & Trent, P.C., Dallas,
Texas, for six years before joining Capstar. Prior to that time, he was an
attorney for Johnson & Gibbs, P.C., Dallas, Texas, for four years.
Paul D. Stone has served as a Vice President and Assistant Secretary
of the Company since February 10, 1997. Mr. Stone has served as an Executive
Vice President and the Chief Financial Officer of Capstar since January 1997.
Mr. Stone was an Executive Vice President and the Chief Financial Officer of
GulfStar from April 1996 until January 1997 at which time Mr. Stone resigned
from such positions. Prior to January 1997, Mr. Stone was Vice President and
80
<PAGE> 81
Controller of Hicks Muse for six years. He holds a Masters Degree in Accounting
from the University of North Texas and is a Certified Public Accountant.
James J. Sullivan is the Chief Financial Officer, Treasurer and
Secretary of the Company. Mr. Sullivan joined the Company in December of 1994.
Prior to joining the Company, Mr. Sullivan was Vice President in charge of
finance and operations for Screen Media Partners from 1990 to 1994. Before
joining Screen Media Partners, Mr. Sullivan was the Senior Manager of
Operations for Grant Tinker/Gannett East, Inc. from 1987 through 1989 and held
various senior management positions in finance and production at NBC News from
1980 through 1987. Mr. Sullivan is a graduate of Fairfield University. Mr.
Sullivan has tendered his resignation effective as of March 31, 1997. The
Company expects to appoint Paul D. Stone as the Chief Financial Officer of the
Company.
Frank D. Osborn has been President and Chief Executive Officer of
Osborn since Osborn's inception in 1984. He is Chairman of the Board of
Fairmont Communications and is a member of the Board of Directors of Northstar
Television Group. From 1983 to 1985, Osborn served as Senior Vice
President/Radio for Price Communications Corporation. From 1981 to 1983, Mr.
Osborn served as Vice President and General Manager of WYNY, NBC's New York FM
radio station, and was Vice President of Finance and Administration of NBC
Radio from 1977 to 1981.
Thomas O. Hicks has been a director of the Company and Capstar since
in October 1996. Thomas O. Hicks has been Chairman and Chief Executive Officer
of Hicks Muse since co-founding the firm in 1989. Prior to forming Hicks Muse,
Thomas O. Hicks co-founded Hicks & Haas Incorporated in 1983 and served as its
Co-Chairman and Co-Chief Executive Officer through 1989. Thomas O. Hicks also
serves as a director of Chancellor Broadcasting Company, Berg Electronics
Corp., Sybron International Corporation and Neodata Corporation. Thomas O.
Hicks is the brother of R. Steven Hicks.
Lawrence D. Stuart, Jr. has served as a director of the Company and
Capstar since January 1997. Mr. Stuart has been a Managing Director and
Principal of Hicks Muse since 1995. Prior to joining Hicks Muse, Mr. Stuart had
served for over 20 years as the principal outside legal counsel for the
investment firms and portfolio companies led by Thomas O. Hicks. From 1989 to
1995, Mr. Stuart was the Managing Partner of the Dallas office of Weil, Gotshal
& Manges (a Limited Liability Partnership including Professional Corporations).
All officers are elected until the next annual meeting of the Board
of Directors or until their respective successors are chosen and qualified.
Directors serve for a one year term or until their successors are elected.
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<PAGE> 82
ITEM 11. EXECUTIVE COMPENSATION
The following table sets forth certain information concerning
compensation paid or accrued in 1996, 1995 and 1994 to the Chief Executive
Officers of the Company and the other most highly compensated executive
officers of the Company for services rendered during the fiscal year ended
December 31, 1996 (the "Named Executive Officers"):
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term Compensation
-------------------------------
Annual Compensation Awards Payouts
------------------------------ -------------------- --------
Other Securities
Annual Restricted Underlying All Other
Name and Compensa- Stock Options/ LTIP Compensa-
Principal Position Year Salary($) Bonus($) tion($) Awards($) SARs(#) Payouts($) tion($)
---------------------- ----- -------- ------ --------- -------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
R. Steven Hicks . . 1996 -- -- -- -- -- -- --
Chief Executive
Officer 1995 -- -- -- -- -- -- --
(since October 16,
1996) 1994 -- -- -- -- -- -- --
Bruce A. Friedman . 1996 207,812 -- 389,178(1) -- -- 739,000 3,412,495(2)
President and Chief 1995 242,361 144,500 4,477 -- -- 1,796,000 --
Executive Officer
(to October 16, 1996) 1994 200,000 300,000 6,428 -- -- 1,750,000 --
James T. Shea, Jr. 1996 262,500 -- 6,000 -- -- 170,000 3,412,495(2)
President 1995 242,361 144,500 22,839 -- -- 183,000 --
1994 200,000 184,000 1,582 -- -- 430,000 --
James J. Sullivan . 1996 163,333 -- 5,006 -- -- -- 1,409,530(2)
Chief Financial
Officer 1995 146,944 91,000 1,935 -- -- -- --
1994 11,667 -- -- -- -- -- --
Frank D. Osborn . . 1996 387,000 300,000 -- -- -- -- 1,778,375(3)
President and Chief 1995 378,490 300,000 -- -- 35,000 -- 16,000(3)
Executive Officer
of Osborn 1994 366,995 100,000 -- -- -- -- 116,000(3)
Scott J. Bacherman(4) 1996 175,300 -- -- -- -- -- 1,075,875(2)
1995 175,885 70,000 -- -- -- -- --
1994 138,000 20,000 -- -- -- -- --
Jay Sterin(4) . . . 1996 170,000 -- -- -- -- -- 850,060(2)
1995 168,000 40,000 -- -- -- -- --
1994 138,000 20,000 -- -- -- -- --
</TABLE>
- ------------------------
(1) Includes approximately $375,000 paid to Bruce A. Friedman in
connection with the acquisition of the Company by Capstar in
settlement of the Company's future obligations to Mr. Friedman under
the terms of his employment agreement.
(2) Represents for each executive officer the amount paid in connection
with Capstar's acquisition of the Company in settlement of such
executive officer's outstanding options to purchase shares of Common
Stock. See "--Stock Option Plan."
(3) Frank D. Osborn became an executive officer of the Company upon
consummation of the Osborn Acquisition in February 1997. Mr. Osborn's
employment agreement with Osborn prior to the Osborn Acquisition
provided that Osborn pay $16,000 annually into a retirement benefit
arrangement for Mr. Osborn. Mr. Osborn elected to have such amount
deposited into Osborn's Non-Qualified Deferred Compensation Plan. In
1996, Mr. Osborn also received $1,746,875 in compensation from the
exercise of non-qualified stock options granted by Osborn and $15,500
from the exercise of incentive stock options granted by Osborn. In
1994, Mr. Osborn also received $100,000 to compensate him for salary
increases that accrued under his previous employment agreement which
would have expired in May 1995.
(4) Scott J. Bacherman and Jay Sterin were executive officers of the
Company until consummation of Capstar's acquisition of the Company on
October 16, 1996. Mr. Bacherman and Mr. Sterin continue to have
duties similar to their duties prior to October 16, 1996.
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<PAGE> 83
STOCK OPTION PLAN
1995 Stock Option Plan. The Company's 1995 Stock Option Plan (the
"1995 Option Plan") became effective on April 21, 1995. The Company does not
expect to grant any options under the 1995 Option Plan to purchase shares of
Common Stock in the future. The Company anticipates that Capstar will grant
options to purchase shares of Capstar Common Stock under Capstar's 1996 Stock
Option Plan ("Capstar Option Plan") to attract and retain qualified personnel
and to provide additional incentives to executive and other key employees of
the Company. In connection with Capstar's acquisition of the Company, all
outstanding options to purchase shares ("Option Shares") of the Company's
Common Stock under the 1995 Option Plan were settled for consideration equal to
$140 per Option Share minus the exercise price per Option Share, less any
applicable withholding taxes.
OPTION GRANTS IN 1996
The following table sets forth certain information concerning stock
option grants during the year ended December 31, 1996 to the Named Executive
Officers pursuant to the 1995 Option Plan.
OPTION GRANTS IN LAST FISCAL YEAR(1)
<TABLE>
<CAPTION>
Individual Grants
--------------------------------------------------
Potential Realizable
Value At Assumed
Percent Annual Rates
Number of of Total of Stock Price
Securities Options Appreciation
Underlying Granted to Exercise for Option Term (1)
Options Employees Price Expiration -----------------------
Name Granted(#) in 1996(%) Per Share Date(1) 5%($) 10%($)
---- ---------- ---------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
R. Steven Hicks . . . . . -- -- -- -- -- --
Bruce A. Friedman . . . . 7,608 21.46% $45.00 -- -- --
James T. Shea, Jr. . . . 7,608 21.46% $45.00 -- -- --
James J. Sullivan . . . . 4,249 11.98% $45.00 -- -- --
Frank D. Osborn . . . . -- -- -- -- -- --
Scott J. Bacherman . . . -- -- -- -- -- --
Jay Sterin . . . . . . . 1,398 3.94% $45.00 -- -- --
</TABLE>
- -------------------------
(1) In connection with Capstar's acquisition of the Company, all
outstanding Option Shares were settled for consideration equal to $140
per Option Share minus the exercise price per Option Share, less any
applicable withholding taxes.
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<PAGE> 84
OPTION EXERCISES IN 1996
The following table sets forth certain information (i) with respect to
the number of shares of Common Stock issued upon exercises of options by the
Named Executive Officers during the fiscal year ended December 31, 1996 and
(ii) with respect to the unexercised options granted under the 1995 Option Plan
held by the Named Executive Officers at December 31, 1996.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised
Shares Options In-the-Money Options at
Acquired at December 31, 1996 December 31, 1996
on Value -------------------------- ------------------------
Name Exercise Realized($) Exercisable Unexercisable Exercisable Unexercisable
----------------------- --------- ---------- ------------ ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
R. Steven Hicks . . . -- -- -- -- -- --
Bruce A. Friedman(1) 35,921 3,412,495 -- -- -- --
James T. Shea, Jr.(1) 35,921 3,412,495 -- -- -- --
James J. Sullivan(1) 15,574 1,479,530 -- -- -- --
Frank D. Osborn(2) . 174,167 1,762,375 9,667 23,333 76,273(2) 184,097(2)
Scott J. Bacherman(1) 11,325 1,075,875 -- -- -- --
Jay Sterin(1) . . . . 8,948 850,060 -- -- -- --
</TABLE>
- ----------------------
(1) In connection with Capstar's acquisition of the Company, all outstanding
Option Shares were settled for consideration equal to $140 per Option Share
minus the exercise price per Option Share, less any applicable withholding
taxes.
(2) Reflects options to acquire shares of common stock of Osborn. The value
realized on shares of common stock acquired on exercise of such options
reflects an exercise price of $14.75 per share. The value of unexercised
in-the-money options reflects gains on outstanding options based on the
December 31, 1996 closing trade price of the common stock of Osborn of
$14.89. In connection with the Osborn Acquisition, all outstanding shares
of common stock of Osborn were canceled in exchange for $15.375 per share
and all outstanding options were settled for consideration equal to $15.375
per option share minus the exercise price per option share, less any
applicable withholding taxes.
DIRECTORS COMPENSATION
Directors of the Company do not presently receive compensation for
their services as directors. Directors of the Company are entitled to
reimbursement of their reasonable out-of-pocket expenses in connection with
their travel to and attendance at meetings of the Board of Directors or
committees thereof.
In 1996, each non-employee director of the Company received $1,000 for
each Board meeting which they attended. In addition, Daniel H. Stern, a
non-employee director, received 1,053 Option Shares during 1996 (with a net
value of $100,035) for his services as a director of the Company until Mr.
Stern's resignation on October 16, 1996 in connection with Capstar's acquisition
of the Company.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company does not currently have a compensation committee. During
1996, the Board of Directors established the compensation of the Company's
executive officers, the members of which, at the time that compensation
decisions were made, were Bruce A. Friedman (the Company's former President
and Chief Executive Officer), Susan L. Burden (the Company's former Secretary
and Treasurer) and Daniel H. Stern.
EMPLOYMENT AGREEMENTS AND ARRANGEMENTS
James T. Shea, Jr. Employment Agreement. The Company and Capstar have
entered into an employment agreement with James T. Shea, Jr. pursuant to which
Mr. Shea serves as the President of the Company. Mr. Shea's employment
agreement terminates on April 30, 1999. Mr. Shea's current base salary is
$275,625, which increases at the beginning of each calendar year by an amount
which shall not be less than five percent of his then current base salary. Mr.
Shea is also entitled to receive annual bonuses as the Board of Directors of
the Company may determine, provided that the bonus shall not be more than
$150,000. In addition, the employment agreement provides for an automobile
allowance, participation in the retirement, savings, and welfare benefit plans
of the Company, a life insurance policy of $650,000 and stock options to
purchase 720,880 shares of Capstar Common Stock at $1.00 per share under the
Capstar Option Plan (which stock options were granted in 1996). If the Company
terminates Mr. Shea's employment for cause, the Company is obligated to pay Mr.
Shea's then accrued base salary, reimbursable expenses, and any other
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<PAGE> 85
compensation then due and owing. In addition, the Company must continue to fund
Mr. Shea's life insurance policy. If the employment agreement is terminated due
to death or disability, without cause or by Mr. Shea for good reason, Mr. Shea
will be entitled to (i) the continuation of his annual base salary, as then in
effect, for a period equal to (A) if the termination date occurs after April
21, 1998 but prior to April 30, 1999, a 12-month period commencing on the
termination date or (B) if the termination date occurs on or prior to April 21,
1998, the lesser of (x) a 24-month period commencing on the termination date
and (y) the period starting on the termination date and ending on April 30,
1999, (ii) a pro rata amount of his annual bonus, (iii) any annual base salary
and annual bonus then accrued but not yet paid, (iv) the continuation of his
welfare benefits for a period equal to (A) if the termination date occurs after
April 21, 1998 but prior to April 30, 1999, a 12-month period commencing on the
termination date or (B) if the termination date occurs on or prior to April 21,
1998, the lesser of (x) a 24-month period commencing on the termination date
and (y) the period starting on the termination date and ending on April 30,
1999, (v) the continuation of his life insurance policy, (vi) any other
compensation and benefits as may be provided in accordance with the terms and
provisions of any applicable plans and programs, (vii) reimbursement for
certain expenses incurred as of the termination date but not yet paid as of the
date of termination and (viii) any other rights afforded to him under other
written agreements between Mr. Shea and Capstar.
Frank D. Osborn Employment Agreement. Upon consummation of the
Osborn Acquisition, Osborn entered into an employment agreement with Frank D.
Osborn pursuant to which Mr. Osborn will continue to serve as the President and
Chief Executive Officer of Osborn. Mr. Osborn's employment agreement will
terminate on February 20, 2002. Mr. Osborn's base salary will be $375,000, and
commencing on January 1, 1998, and on each subsequent January 1, his base
salary will be adjusted to reflect the annual increase in the Consumer Price
Index during the preceding year. In addition, Mr. Osborn will be entitled to
a guaranteed bonus of $25,000 per month for a period of 60 months after the
date of the agreement and an annual bonus as determined by Osborn's Board of
Directors. Further, Mr. Osborn will be granted non- qualified stock options
for 1,500,000 shares of Capstar Common Stock. Except as otherwise provided in
the employment agreement or in the Capstar Option Plan, the stock options will
vest with respect to 20.0% of the shares of Capstar Common Stock subject
thereto on the first anniversary of the date of grant, and 1/60th of such
shares shall vest on the last day of each calendar month thereafter. If Mr.
Osborn's employment is terminated by Osborn for cause or by Mr. Osborn for
other than good reason, Osborn is obligated to pay all accrued obligations and
other benefits to Mr. Osborn. If the employment agreement is terminated by
Osborn other than for cause or disability or by Mr. Osborn for good reason,
Osborn must pay Mr. Osborn (i) all accrued obligations under the agreement,
(ii) in regular installments (A) if the remainder of the employment period is
24 months or less, Mr. Osborn's then current salary for the remainder of the
employment period, (B) if the remainder of the employment period is more than
24 months but less than 36 months, twice the sum of Mr. Osborn's then current
salary, plus Mr. Osborn's then current salary for a period of 12 months after
the 24 months have expired from the termination date, and (iii) the guaranteed
bonus as if Mr. Osborn's employment had not been terminated. Mr. Osborn will
also be entitled to participate in Osborn's employee medical benefit plan for
24 months following termination unless Osborn fails to achieve 60.0% of its
annual budget for operating profit for the last calendar year ended prior to
termination. In that case, Mr. Osborn will be entitled to participate in such
plan for 12 months following termination.
Scott J. Bacherman Employment Agreement. On April 21, 1995, the
Company and Mr. Bacherman entered into an employment agreement that expires on
April 30, 1999. The employment agreement provides for a base salary of
$170,000 with annual increases in the base salary of an amount which shall not
be less than 5% of the annual base salary in effect immediately prior to such
increase. Mr. Bacherman's employment agreement provides for incentive
compensation, as established by the President of the Company, based on the
operating cash flow of certain stations in each calendar year with a potential
target of $100,000.
Jay Sterin Employment Agreement. Mr. Sterin currently has an
employment agreement with the Company that expires on April 30, 1999. The
employment agreement provides for a base salary of $158,000 with annual
increases in the base salary of an amount which shall not be less than 5% of
the annual base salary in effect immediately prior to such increase. Mr.
Sterin's employment agreement provides for incentive compensation based on the
operating cash flow of certain stations, with a maximum payout in each calendar
year as established by the President of the Company, with a potential target of
$60,000.
LIMITATIONS ON DIRECTORS AND OFFICERS LIABILITY
The Company's Amended and Restated Certificate of Incorporation limits
the liability of directors to the maximum extent permitted by Delaware law,
which specifies that a director of a company adopting such a provision will not
be personally liable for monetary damages for breach of fiduciary duty as a
director, except for the liability (i) for any breach of the director's duty of
loyalty to the Company or its stockholders; (ii) for acts of omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law; (iii) for unlawful payments of dividends or
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<PAGE> 86
unlawful stock repurchases or redemptions as provided in Section 174 of the
Delaware General Corporation Law; or (iv) for any transaction from which the
director derived in imposer personal benefit.
The Company's Amended and Restated Certificate of Incorporation
provides for mandatory indemnification of directors and authorize
indemnification for officers (and others) in such manner, under such
circumstances and to the fullest extent permitted by the Delaware General
Corporation Law, which generally authorizes indemnification as to all expenses
incurred or imposed as a result of actions, suits or proceedings if the
indemnified parties act in good faith and in a manner they reasonably believe
to be in or not opposed to the best interests of the Company and the Amended
and Restated Certificate of Incorporation provides the right to such expenses
in advance of the final disposition of any such action, suit or proceeding.
The Company believes that these provisions are necessary or useful to attract
and retain qualified persons or directors.
There is no pending litigation or proceeding involving a director or
officer as to which indemnification is being sought.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The Company is a wholly-owned subsidiary of Capstar. As of March 15,
1997, Capstar owned 249,847,909 shares of Common Stock, which represented all
of the Common Stock issued and outstanding on such date. The principal
executive offices of Capstar are located at 600 Congress Avenue, Suite 1400,
Austin, Texas 78701.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On February 20, 1997, Capstar purchased 143,090,909 shares of Common
Stock for an aggregate purchase price of $157.4 million paid in cash. The
Company used the proceeds of such stock purchase to repay in full the Company's
borrowings under the $35.0 million senior secured credit facility (the "AT&T
Credit Facility") made available by AT&T Commercial Finance Corporation to CHI
and to finance the Osborn Acquisition.
During May 1995, the Company advanced $100,160 as a loan to Bruce A.
Friedman, the former President and Chief Executive Officer of the Company. The
principal and interest on such loan were repaid in full in connection with the
acquisition of the Company by Capstar in October 1996. The Company has no
current intention of making additional loans to employees, executive officers
and/or affiliates. If the Company does make additional loans in the future,
the terms thereof will be determined by the Board of Directors with respect to
executive officers and affiliates, and by the Chief Executive Officer with
respect to employees, each acting in the best interest of the Company. Such
determinations will be made based upon the likelihood of repayment and the
value of such employee, executive officer or affiliate to the Company.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(A)(1) CONSOLIDATED FINANCIAL STATEMENTS
The following consolidated financial statements of the Company are
included in "Item 8. Financial Statements and Supplementary Data":
Report of Independent Auditors
Consolidated Balance Sheets at December 31, 1996 and 1995
Consolidated Statements of Operations for the Years Ended December
31, 1996, 1995 and 1994
Consolidated Statements of Stockholders' Deficit for the Years Ended
December 31, 1996, 1995 and 1994
Consolidated Statements of Cash Flows for the Years Ended December
31, 1996, 1995 and 1994
Notes to Consolidated Financial Statements
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<PAGE> 87
(A)(2) FINANCIAL STATEMENT SCHEDULES
The following financial statement schedule is included in "Item 8.
Financial Statements and Supplementary Data":
Schedule II - Valuation and Qualifying Accounts
All other statements and schedules have been omitted because they are
not required under related instructions, are inapplicable or are immaterial, or
the information is shown in the consolidated financial statements of the
Company or the notes thereto.
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<PAGE> 88
(A)(3) EXHIBITS:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE
- ------ -------------
<S> <C> <C>
2.1.1+ -- Agreement and Plan of Merger dated June 21, 1996 (the "Merger Agreement"), by and among CMI
Acquisition Company, Inc., the Company and the stockholders and other signatories thereto.
Incorporated by reference to the Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 1996, File No. 33-92732.
2.1.2+ -- First Amendment dated as of September 3, 1996 to the Merger Agreement. Incorporated by reference
to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1996, File No.
33-92732.
2.1.3+ -- Second Amendment dated as of October 16, 1996 to the Merger Agreement. Incorporated by reference
to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1996, File No.
33-92732.
2.2.1+ -- Agreement and Plan of Merger dated as of July 23, 1996, among OCC Acquisition Company, Inc. ("OCC")
and OCC Holding Corporation. Incorporated by reference to Osborn's Current Report on Form 8-K
dated July 23, 1996, File No. 0-16841.
2.2.2+ -- First Amendment to Agreement and Plan of Merger dated as of February 20, 1997, by and among OCC,
the Company, OCC Holding Corporation and Osborn. Incorporated by reference to the Company's
Current Report on Form 8-K dated February 20, 1997, File No. 33-92732.
3.1.1 -- Amended and Restated Certificate of Incorporation of the Company. Incorporated by reference to the
Company's Registration Statement on Form S-4 (File No. 33-92732) dated July 26, 1995 (the
"Company's S-4").
3.1.2* -- Certificate of Amendment to Amended and Restated Certificate of Incorporation of the Company.
3.1.3 -- By-laws of the Company. Incorporated by reference to the Company's S-4.
3.1.4* -- Certificate of Amendment to By-laws of the Company, as amended.
3.2.1 -- Certificate of Incorporation of Commodore Media of Delaware, Inc. Incorporated by reference to the
Company's S-4
3.2.2 -- By-laws of Commodore Media of Delaware, Inc. Incorporated by reference to the Company's S-4.
3.2.3* -- Certificate of Amendment to By-laws of Commodore Media of Delaware, Inc.
3.3.1 -- Certificate of Incorporation of Commodore Media of Pennsylvania, Inc. Incorporated by reference to
the Company's S-4.
3.3.2 -- By-laws of Commodore Media of Pennsylvania, Inc. Incorporated by reference to the Company's S-4.
3.3.3* -- Certificate of Amendment to By-laws of Commodore Media of Pennsylvania, Inc.
3.4.1 -- Certificate of Incorporation of Commodore Media of Florida, Inc. Incorporated by reference to the
Company's S-4.
3.4.2 -- By-laws of Commodore Media of Florida, Inc. Incorporated by reference to the Company's S-4.
3.4.3* -- Certificate of Amendment to By-laws of Commodore Media of Florida, Inc.
3.5.1 -- Certificate of Incorporation of Commodore Media of Kentucky, Inc. Incorporated by reference to the
Company's S-4.
3.5.2 -- By-laws of Commodore Media of Kentucky, Inc. Incorporated by reference to the Company's S-4.
3.5.3* -- Certificate of Amendment to By-laws of Commodore Media of Kentucky, Inc.
3.6.1 -- Certificate of Incorporation of Commodore Media of Norwalk, Inc. Incorporated by reference to the
Company's S-4.
3.6.2 -- By-laws of Commodore Media of Norwalk, Inc. Incorporated by reference to the Company's S-4.
3.6.3* -- Certificate of Amendment to By-laws of Commodore Media of Norwalk, Inc.
3.7.1 -- Certificate of Incorporation of Commodore Media of Westchester, Inc. Incorporated by reference to
the Company's S-4.
</TABLE>
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<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE
- ------ -------------
<S> <C> <C>
3.7.2 -- By-laws of Commodore Media of Westchester, Inc. Incorporated by reference to the Company's S-4.
3.7.3* -- Certificate of Amendment to By-laws of Commodore Media of Westchester, Inc.
3.8.1 -- Certificate of Incorporation of Danbury Broadcasting, Inc. Incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31, 1995, File No. 33-92732.
3.8.2 -- By-laws of Danbury Broadcasting, Inc. Incorporated by reference to the Company's Annual Report on
Form 10-K for the year ended December 31, 1995, File No. 33-92732.
3.8.3* -- Certificate of Amendment to By-laws of Danbury Broadcasting, Inc.
3.9* -- Restated Certificate of Incorporation of Osborn.
3.10* -- Certificate of Incorporation of Asheville Broadcasting Corp.
3.11* -- Certificate of Incorporation of Atlantic City Broadcasting Corp.
3.12* -- Certificate of Incorporation of Beatrice Broadcasting Corp.
3.13* -- Certificate of Incorporation of Breadbasket Broadcasting Corporation.
3.14* -- Certificate of Incorporation of Corkscrew Broadcasting Corporation.
3.15* -- Certificate of Incorporation of Currey Broadcasting Corporation.
3.16* -- Certificate of Incorporation of Daytona Beach Broadcasting Corp.
3.17* -- Articles of Incorporation of Great American East, Inc.
3.18* -- Certificate of Incorporation of Houndstooth Broadcasting Corporation.
3.19* -- Certificate of Incorporation of Jamboree in the Hills, Inc.
3.20* -- Certificate of Incorporation of Ladner Communications Holding Corp.
3.21* -- Certificate of Incorporation of Mountain Radio Corporation.
3.22* -- Articles of Incorporation of Music Hall Club, Inc.
3.23* -- Certificate of Incorporation of Nelson Broadcasting Corporation.
3.24* -- Certificate of Incorporation of O.C.C., Inc.
3.25* -- Certificate of Incorporation of Orange Communications, Inc.
3.26* -- Certificate of Incorporation of Osborn Entertainment Enterprises Corporation.
3.27* -- Certificate of Incorporation of Osborn Sound & Communications Corp.
3.28* -- Certificate of Incorporation of RKZ Television, Inc.
3.29* -- Certificate of Incorporation of Rainbow Broadcasting Corporation.
3.30* -- Certificate of Incorporation of Short Broadcasting Corporation.
3.31* -- Certificate of Incorporation of SNG Holdings, Inc.
3.32* -- Certificate of Incorporation of Southeast Radio Holding Corp.
3.33* -- Certificate of Incorporation of Waite Broadcasting Corp.
3.34* -- Certificate of Incorporation of Yellow Brick Radio Corporation.
3.35* -- Certificate of Incorporation of Ameron Broadcasting Corporation.
3.36* -- Certificate of Incorporation of WNOK Acquisition Company, Inc.
3.37* -- Form By-laws adopted by the Additional Osborn Registrants and schedule setting forth material
differences of the By-laws of the Additional Osborn Registrants from the form By-laws.
3.38.1* -- Certificate of Incorporation of Commodore Holdings, Inc.
3.38.2* -- By-laws of Commodore Holdings, Inc.
3.38.3* -- Certificate of Amendment to By-laws of Commodore Holdings, Inc.
4.1.1 -- Indenture dated as of April 21, 1995 among the Company, IBJ Schroder Bank & Trust Company, as
Trustee, and the Guarantors named therein (the "Indenture"). Incorporated by reference to the
Company's S-4.
4.1.2 -- Amendment No. 1 to Indenture. Incorporated by reference to the Company's S-4.
4.1.3 -- Amendment No. 2 to Indenture. Incorporated by reference to the Company's Annual Report on Form 10-
K for the year ended December 31, 1995, File No. 33-92732.
4.1.4 -- Amendment No. 3 to Indenture. Incorporated by reference to the Company's Annual Report on Form 10-
K for the year ended December 31, 1995, File No. 33-92732.
4.1.5 -- Amendment No. 4 to Indenture. Incorporated by reference to the Company's Quarterly Report on Form
10-Q for the quarter ended March 31, 1996, File No. 33-92732.
</TABLE>
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<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE
- ------ -------------
<S> <C> <C>
4.1.6* -- Amendment No. 5 to Indenture.
4.2 -- Form of Original Note No. 1 for $75,500,000, Cusip No. 20266P AA 9, with Guarantee of Guarantors
listed therein. Incorporated by reference to the Company's S-4. . . .
4.3 -- Form of New Note with Form of New Guarantee. Incorporated by reference to the Company's S-4.
4.4 -- Registration Rights Agreement dated as of April 21, 1995, by and among the Company, the Guarantors
named therein and each of the Purchasers referred to therein. Incorporated by reference to the
Company's S-4.
10.1 -- Securities Purchase Agreement dated as of April 13, 1995, by and among the Company, the Guarantors
named therein and each of the Purchasers referred to therein. Incorporated by reference to the
Company's S-4.
10.2 -- Note No. 1 for $1,308,000, Cusip No. 20266 AA 9, with Guarantee of Guarantors listed therein.
Incorporated by reference to the Company's S-4.
10.3++ -- 1995 Stock Option Plan of the Company. Incorporated by reference to the Company's S-4.
10.4 -- Sales and Marketing Agreement between Commodore Media of Pennsylvania, Inc. (formerly known as CRB
Broadcasting of Pennsylvania, Inc.) and East Penn Broadcasting, Inc. with respect to station
WKAP-AM (formerly WXKW-AM). Incorporated by reference to the Company's S-4.
10.5.1++ -- Amended and Restated Employment Agreement dated April 21, 1995, by and between the Company and
Bruce A. Friedman. Incorporated by reference to the Company's S-4.
10.5.2++ -- Amendment No. 1 to Amended and Restated Employment Agreement between the Company and Bruce A.
Friedman. Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended
December 31, 1995, File No. 33-92732.
10.6.1++ -- Amended and Restated Employment Agreement dated April 21, 1995, by and between the Company and
James T. Shea, Jr. Incorporated by reference to the Company's Annual Report on Form 10-K for the
year ended December 31, 1995, File No. 33-92732.
10.6.2++ -- Amended and Restated Employment Agreement dated October 16, 1996, between the Company and James T.
Shea, Jr. Incorporated by reference to the Company's Current Report on Form 8-K, dated October 16,
1996, File No. 33-92732.
10.7++ -- Employment Agreement dated July 1, 1995, by and between the Company and Charlie V. DiToro.
Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
10.8++ -- Employment Agreement dated as of April 21, 1995, by and between the Company and Jay Sterin.
Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
10.9.1++ -- Employment Agreement dated July 1, 1994, between Osborn and Frank D. Osborn. Incorporated by
reference to Osborn's Quarterly Report on Form 10-Q for the quarter ended June 30, 1994, File No.
0-16841.
10.9.2++ -- Amendment No. 1 dated July 1, 1996 to the employment agreement dated July 1, 1994 between Osborn
and Frank D. Osborn. Incorporated by reference to Osborn's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1996, File No. 0-16841.
10.9.3++ -- Amendment No. 2 dated July 23, 1996 to the employment agreement dated July 1, 1994 between Osborn
and Frank D. Osborn. Incorporated by reference to Osborn's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1996, File No. 0-16841.
10.9.4*++ -- Employment Agreement dated February 20, 1997, between Osborn and Frank D. Osborn.
10.10 -- Promissory Note, dated April 21, 1995, in the aggregate principal amount of $900,000, issued by
Bruce A. Friedman to Carter Burden as security for Class A shares held by Mr. Friedman.
Incorporated by reference to the Company's S-4.
10.11 -- Promissory Note, dated April 21, 1995, in the aggregate principal amount $208,000, issued by
James T. Shea, Jr. to Carter Burden as security for Class A shares held by Mr. Shea. Incorporated
by reference to the Company's S-4.
10.12 -- Promissory Note, dated as of May 15, 1995, in the aggregate principal amount $50,215, issued by
Carter burden to the Company. Incorporated by reference to the Company's S-4.
</TABLE>
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<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE
- ------ -------------
<S> <C> <C>
10.13 -- Promissory Note, dated as of May 15, 1995, in the aggregate principal amount $100,160, issued by
Bruce A. Friedman to the Company. Incorporated by reference to the Company's S-4.
10.14 -- Promissory Note, dated as of May 15, 1995, in the aggregate principal amount $50,000, issued by
James T. Shea, Jr. to the Company. Incorporated by reference to the Company's S-4.
10.15 -- Promissory Note, dated as of May 15, 1995, in the aggregate principal amount $50,000, issued by
James J. Sullivan to the Company. Incorporated by reference to the Company's S-4.
10.16 -- Option Purchase Agreement dated as of March 17, 1995, between Treasure Coast Media, Inc. ("Treasure
Coast") and Commodore Media of Florida, Inc. Incorporated by reference to the Company's Annual
Report on Form 10-K for the year ended December 31, 1995, File No. 33-92732.
10.17 -- Sales Local Marketing Agreement dated as of March 17, 1995, between Commodore Media of Florida,
Inc. (formerly known as CRB Broadcasting of Florida, Inc.) and Treasure Coast Media, Inc. with
respect to station WPAW-FM (formerly WZZR-FM). Incorporated by reference to the Company's Annual
Report on Form 10-K for the year ended December 31, 1995, File No. 33-92732.
10.18 -- Loan and Security Agreement dated as of March 13, 1996, among CHI, as Borrower, the Company,
Commodore Media of Delaware, Inc., Commodore Media of Pennsylvania, Inc., Commodore Media of
Florida, Inc., Commodore Media of Kentucky, Inc., Commodore Media of Norwalk, Inc. and Commodore
Media of Westchester, Inc., as Guarantors, and AT&T Commercial Finance Corporation, as Lender.
Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
10.19 -- Supplement No. 1 to the Loan Agreement. Incorporated by reference to the Company's Annual Report
on Form 10-K for the year ended December 31, 1995, File No. 33-92732.
10.20++ -- Employment Agreement dated as of April 21, 1995, by and between the Company and Scott J. Bacherman.
Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
10.21++ -- Employment Agreement dated as of April 21, 1995, by and between the Company and Judy Jennings.
Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
10.22++ -- Employment Agreement dated as of April 21, 1995, by and between the Company and James J. Sullivan.
Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
10.23++ -- Employment Agreement dated as of July 1, 1995, by and between the Company and Rich Lewis.
Incorporated by reference to the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
10.24 -- Local Marketing Agreement dated April 8, 1996, between Commodore Media of Kentucky and Simmons
Broadcasting Company with respect to station WHRD-AM. Incorporated by reference to the Company's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1996, File No. 33-92732.
10.25* -- Form Indemnification Agreement between Osborn and each of its directors and officers.
10.26 -- Credit Agreement dated February 20, 1997, among the Company, as borrower, Capstar, as guarantor,
various banks, and Bankers Trust Company, as administrative agent. Incorporated by reference to
the Company's Current Report on Form 8-K dated February 20, 1997.
10.27 -- Osborn Communications Corporation Deferred Compensation Plan. Incorporated by reference to
Osborn's Annual Report on Form 10-K for the year ended December 31, 1994, File No. 0-16841.
10.28 -- Osborn Communications Corporation Deferred Compensation Plan. Incorporated by reference to
Osborn's Annual Report on Form 10-K for the year ended December 31, 1995, File No. 0-16841.
10.29 -- Loan Agreement by and among Osborn, Society National Bank, and the Financial Institutions Listed
Herein as of August 18,1995. Incorporated by reference to Osborn's Quarterly Report on Form 10-Q
for the quarter ended September 30, 1995, File No. 0-16841.
</TABLE>
91
<PAGE> 92
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE
- ------ -------------
<S> <C> <C>
10.30 -- Option Agreement, dated December 21, 1995, between RKZ Television, Inc. and Allbritton
Communications Corporation. Incorporated by reference to Osborn's Annual Report on Form 10-K for
the year ended December 31, 1995, File No. 0-16841.
10.31* -- Credit Agreement dated as of March 14, 1997, among Emerald City Radio
Partners, L.P., as borrower, and Commodore Media, Inc., as lender.
21.1* -- Subsidiaries of the Company.
27.1* -- Financial Data Schedule.
</TABLE>
_______________
* Filed herewith.
+ The Company will furnish upon request of the Commission any omitted schedule
or exhibit.
++ Executive Compensation plan or arrangement.
(b) REPORTS ON FORM 8-K
The following reports on Form 8-K were filed by the Company during the
last quarter of the period covered by this Annual Report on Form 10-K:
Current Report on Form 8-K dated October 16, 1996, relating to
Capstar's acquisition of the Company. Items 1, 2 and 5 were reported.
Current Report on Form 8-K/A dated December 31, 1996, relating to
Current Report on Form 8-K dated October 16, 1996. Item 7 was
reported.
No other Current Reports on Form 8-K were filed by the Company during
the last quarter of the period covered by this Annual Report on Form 10-K.
92
<PAGE> 93
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, each of Commodore Media, Inc. and Commodore Holdings,
Inc. has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
COMMODORE MEDIA, INC.
COMMODORE HOLDINGS, INC.
By: /s/ R. Steven Hicks
--------------------
R. Steven Hicks
Chairman of the Board, Chief Executive Officer
and Director
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
Commodore Media, Inc. and Commodore Holdings, Inc. and in the capacities and on
the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ R. Steven Hicks Chairman of the Board, March 27, 1997
-------------------
R. Steven Hicks Chief Executive Officer and Director
of each of the above Registrants
(principal executive officer)
/s/ James J. Sullivan Chairman of the Board March 27, 1997
--------------------- Treasurer and Secretary
James J. Sullivan of each of the above Registrants
(principal financial and accounting
officer)
/s/ Eric C. Neuman Director March 27, 1997
------------------ of each of the above Registrants
Eric C. Neuman
/s Thomas O. Hicks Director March 27 1997
------------------ of each of the above Registrants
Thomas O. Hicks
/s/ Lawrence D. Stuart, Jr. Director March 27, 1997
--------------------------- of each of the above Registrants
Lawrence D. Stuart, Jr.
</TABLE>
<PAGE> 94
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, Osborn Communications Corporation has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
OSBORN COMMUNICATIONS CORPORATION
By: /s/ Frank D. Osborn
---------------------------------
Frank D. Osborn
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of Osborn
Communications Corporation and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Frank D. Osborn President and Chief Executive Officer March 27, 1997
------------------- (principal executive officer)
Frank D. Osborn
/s/ Thomas S. Douglas Vice President, Chief Financial Officer March 27, 1997
--------------------- and Treasurer
Thomas S. Douglas (principal financial and accounting
officer)
/s/ R. Steven Hicks Director March 27, 1997
-------------------
R. Steven Hicks
/s/ Eric C. Neuman Director March 27, 1997
------------------
Eric C. Neuman
/s Thomas O. Hicks Director March 27, 1997
------------------
Thomas O. Hicks
/s/ Lawrence D. Stuart, Jr. Director March 27, 1997
---------------------------
Lawrence D. Stuart, Jr.
</TABLE>
<PAGE> 95
SIGNATURES
Pursuant to the requirements of the Exchange Act of 1934, each of
Commodore Media of Delaware, Inc., Commodore Media of Pennsylvania, Inc.,
Commodore Media of Florida, Inc., Commodore Media of Kentucky, Inc., Commodore
Media of Norwalk, Inc., Commodore Media of Westchester, Inc. and Danbury
Broadcasting, Inc. has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
COMMODORE MEDIA OF DELAWARE, INC.
COMMODORE MEDIA OF PENNSYLVANIA, INC.
COMMODORE MEDIA OF FLORIDA, INC.
COMMODORE MEDIA OF KENTUCKY, INC.
COMMODORE MEDIA OF NORWALK, INC.
COMMODORE MEDIA OF WESTCHESTER, INC.
DANBURY BROADCASTING, INC.
By: /s/ R. Steven Hicks
------------------------
R. Steven Hicks
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons on behalf of each of the
above Registrants and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ R. Steven Hicks Chief Executive Officer March 27, 1997
------------------- of each of the above Registrants
R. Steven Hicks (principal executive officer)
/s/ James J. Sullivan Chief Financial Officer March 27, 1997
--------------------- Treasurer and Secretary
James J. Sullivan of each of the above Registrants
(principal financial and accounting
officer)
/s/ Eric C. Neuman Director March 27, 1997
------------------ of each of the above Registrants
Eric C. Neuman
</TABLE>
<PAGE> 96
SIGNATURES
Pursuant to the requirements of the Exchange Act of 1934, each of
Asheville Broadcasting Corp., Atlantic City Broadcasting Corp., Beatrice
Broadcasting Corp., Breadbasket Broadcasting Corporation, Corkscrew Broadcasting
Corporation, Currey Broadcasting Corporation, Daytona Beach Broadcasting Corp.,
Great American East, Inc., Houndstooth Broadcasting Corporation, Jamboree in the
Hills, Inc., Ladner Communications Holding Corp., Mountain Radio Corporation,
Music Hall Club, Inc., Nelson Broadcasting Corporation, O.C.C., Inc., Orange
Communications, Inc., Osborn Entertainment Enterprises Corporation, Osborn Sound
& Communications Corp., RKZ Television, Inc., Rainbow Broadcasting Corporation,
Short Broadcasting Corporation, SNG Holdings, Inc., Southeast Radio Holding
Corp., Waite Broadcasting Corp., Yellow Brick Radio Corporation, Ameron
Broadcasting Corporation, WNOK Acquisition Company, Inc., has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
ASHEVILLE BROADCASTING CORP.
ATLANTIC CITY BROADCASTING CORP.
BEATRICE BROADCASTING CORP.
BREADBASKET BROADCASTING CORPORATION
CORKSCREW BROADCASTING CORPORATION
CURREY BROADCASTING CORPORATION
DAYTONA BEACH BROADCASTING CORP.
GREAT AMERICAN EAST, INC.
HOUNDSTOOTH BROADCASTING CORPORATION
JAMBOREE IN THE HILLS, INC.
LADNER COMMUNICATIONS HOLDING CORP.
MOUNTAIN RADIO CORPORATION
MUSIC HALL CLUB, INC.
NELSON BROADCASTING CORPORATION
O.C.C., INC.
ORANGE COMMUNICATIONS, INC.
OSBORN ENTERTAINMENT ENTERPRISES CORPORATION
OSBORN SOUND & COMMUNICATIONS CORP.
RKZ TELEVISION, INC.
RAINBOW BROADCASTING CORPORATION
SHORT BROADCASTING CORPORATION
SNG HOLDINGS, INC.
SOUTHEAST RADIO HOLDING CORP.
WAITE BROADCASTING CORP.
YELLOW BRICK RADIO CORPORATION
AMERON BROADCASTING CORPORATION
WNOK ACQUISITION COMPANY, INC.
By: /s/ Frank D. Osborn
------------------------
Frank D. Osborn
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons on behalf of each of the
above Registrants and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Frank D. Osborn President and Chief Executive Officer March 27, 1997
------------------- of each of the above Registrants
Frank D. Osborn (principal executive officer)
/s/ Thomas S. Douglas Vice President, Chief Financial Officer March 27, 1997
--------------------- and Treasurer
Thomas S. Douglas of each of the above Registrants
(principal financial and accounting
officer)
</TABLE>
<PAGE> 97
<TABLE>
<S> <C> <C>
/s/ Eric C. Neuman Director March 27, 1997
------------------ of each of the above Registrants
Eric C. Neuman
</TABLE>
<PAGE> 98
SUPPLEMENTAL INFORMATION
(c) No annual report or proxy material has been sent to the Company's
securityholders.
<PAGE> 99
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE PAGE
------ ------------- ----
<S> <C> <C>
2.1.1+ -- Agreement and Plan of Merger dated June 21, 1996 (the "Merger Agreement"), by and
among CMI Acquisition Company, Inc., the Company and the stockholders and other
signatories thereto. Incorporated by reference to the Company's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1996, File No. 33-92732.
2.1.2+ -- First Amendment dated as of September 3, 1996 to the Merger
Agreement. Incorporated by reference to the Company's Quarterly
Report on Form 10-Q for the quarter ended September 30, 1996, File
No. 33-92732.
2.1.3+ -- Second Amendment dated as of October 16, 1996 to the Merger
Agreement. Incorporated by reference to the Company's Quarterly
Report on Form 10-Q for the quarter ended September 30, 1996, File
No. 33-92732.
2.2.1+ -- Agreement and Plan of Merger dated as of July 23, 1996, among OCC
Acquisition Company, Inc. ("OCC") and OCC Holding Corporation.
Incorporated by reference to Osborn's Current Report on Form 8-K
dated July 23, 1996, File No. 0-16841.
2.2.2+ -- First Amendment to Agreement and Plan of Merger dated as of February 20, 1997, by and
among OCC, the Company, OCC Holding Corporation and Osborn. Incorporated by reference
to the Company's Current Report on Form 8-K dated February 20, 1997, File No. 33-
92732.
3.1.1 -- Amended and Restated Certificate of Incorporation of the Company.
Incorporated by reference to the Company's Registration Statement on
Form S-4 (File No. 33-92732) dated July 26, 1995 (the "Company's S-
4").
3.1.2* -- Certificate of Amendment to Amended and Restated Certificate of
Incorporation of the Company.
3.1.3 -- By-laws of the Company. Incorporated by reference to the Company's
S-4.
3.1.4* -- Certificate of Amendment to By-laws of the Company, as amended.
3.2.1 -- Certificate of Incorporation of Commodore Media of Delaware, Inc.
Incorporated by reference to the Company's S-4
3.2.2 -- By-laws of Commodore Media of Delaware, Inc. Incorporated by
reference to the Company's S-4.
3.2.3* -- Certificate of Amendment to By-laws of Commodore Media of Delaware,
Inc.
3.3.1 -- Certificate of Incorporation of Commodore Media of Pennsylvania, Inc.
Incorporated by reference to the Company's S-4.
3.3.2 -- By-laws of Commodore Media of Pennsylvania, Inc. Incorporated by
reference to the Company's S-4.
3.3.3* -- Certificate of Amendment to By-laws of Commodore Media of
Pennsylvania, Inc.
3.4.1 -- Certificate of Incorporation of Commodore Media of Florida, Inc.
Incorporated by reference to the Company's S-4.
3.4.2 -- By-laws of Commodore Media of Florida, Inc. Incorporated by reference
to the Company's S-4.
3.4.3* -- Certificate of Amendment to By-laws of Commodore Media of Florida,
Inc.
3.5.1 -- Certificate of Incorporation of Commodore Media of Kentucky, Inc.
Incorporated by reference to the Company's S-4.
3.5.2 -- By-laws of Commodore Media of Kentucky, Inc. Incorporated by
reference to the Company's S-4.
3.5.3* -- Certificate of Amendment to By-laws of Commodore Media of Kentucky,
Inc.
3.6.1 -- Certificate of Incorporation of Commodore Media of Norwalk, Inc.
Incorporated by reference to the Company's S-4.
3.6.2 -- By-laws of Commodore Media of Norwalk, Inc. Incorporated by
reference to the Company's S-4.
3.6.3* -- Certificate of Amendment to By-laws of Commodore Media of Norwalk,
Inc.
3.7.1 -- Certificate of Incorporation of Commodore Media of Westchester, Inc.
Incorporated by reference to the Company's S-4.
3.7.2 -- By-laws of Commodore Media of Westchester, Inc. Incorporated by
reference to the Company's S-4.
3.7.3* -- Certificate of Amendment to By-laws of Commodore Media of
Westchester, Inc.
</TABLE>
<PAGE> 100
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE PAGE
------ ------------- ----
<S> <C> <C>
3.8.1 -- Certificate of Incorporation of Danbury Broadcasting, Inc.
Incorporated by reference to the Company's Annual Report on Form 10-K
for the year ended December 31, 1995, File No. 33-92732.
3.8.2 -- By-laws of Danbury Broadcasting, Inc. Incorporated by reference to
the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
3.8.3* -- Certificate of Amendment to By-laws of Danbury Broadcasting, Inc.
3.9* -- Restated Certificate of Incorporation of Osborn.
3.10* -- Certificate of Incorporation of Asheville Broadcasting Corp.
3.11* -- Certificate of Incorporation of Atlantic City Broadcasting Corp.
3.12* -- Certificate of Incorporation of Beatrice Broadcasting Corp.
3.13* -- Certificate of Incorporation of Breadbasket Broadcasting Corporation.
3.14* -- Certificate of Incorporation of Corkscrew Broadcasting Corporation.
3.15* -- Certificate of Incorporation of Currey Broadcasting Corporation.
3.16* -- Certificate of Incorporation of Daytona Beach Broadcasting Corp.
3.17* -- Articles of Incorporation of Great American East, Inc.
3.18* -- Certificate of Incorporation of Houndstooth Broadcasting Corporation.
3.19* -- Certificate of Incorporation of Jamboree in the Hills, Inc.
3.20* -- Certificate of Incorporation of Ladner Communications Holding Corp.
3.21* -- Certificate of Incorporation of Mountain Radio Corporation.
3.22* -- Articles of Incorporation of Music Hall Club, Inc.
3.23* -- Certificate of Incorporation of Nelson Broadcasting Corporation.
3.24* -- Certificate of Incorporation of O.C.C., Inc.
3.25* -- Certificate of Incorporation of Orange Communications, Inc.
3.26* -- Certificate of Incorporation of Osborn Entertainment Enterprises
Corporation.
3.27* -- Certificate of Incorporation of Osborn Sound & Communications Corp.
3.28* -- Certificate of Incorporation of RKZ Television, Inc.
3.29* -- Certificate of Incorporation of Rainbow Broadcasting Corporation.
3.30* -- Certificate of Incorporation of Short Broadcasting Corporation.
3.31* -- Certificate of Incorporation of SNG Holdings, Inc.
3.32* -- Certificate of Incorporation of Southeast Radio Holding Corp.
3.33* -- Certificate of Incorporation of Waite Broadcasting Corp.
3.34* -- Certificate of Incorporation of Yellow Brick Radio Corporation.
3.35* -- Certificate of Incorporation of Ameron Broadcasting Corporation.
3.36* -- Certificate of Incorporation of WNOK Acquisition Company, Inc.
3.37* -- Form By-laws adopted by the Additional Osborn Registrants and
schedule setting forth material differences of the By-laws of the
Additional Osborn Registrants from the form By-laws.
3.38.1* -- Certificate of Incorporation of Commodore Holdings, Inc.
3.38.2* -- By-laws of Commodore Holdings, Inc.
3.38.3* -- Certificate of Amendment to By-laws of Commodore Holdings, Inc.
4.1.1 -- Indenture dated as of April 21, 1995 among the Company, IBJ Schroder
Bank & Trust Company, as Trustee, and the Guarantors named therein
(the "Indenture"). Incorporated by reference to the Company's S-4.
4.1.2 -- Amendment No. 1 to Indenture. Incorporated by reference to the
Company's S-4.
4.1.3 -- Amendment No. 2 to Indenture. Incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1995, File No. 33-92732.
4.1.4 -- Amendment No. 3 to Indenture. Incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1995, File No. 33-92732.
4.1.5 -- Amendment No. 4 to Indenture. Incorporated by reference to the
Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1996, File No. 33-92732.
4.1.6* -- Amendment No. 5 to Indenture.
</TABLE>
<PAGE> 101
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE PAGE
------ ------------- ----
<S> <C>
4.2 -- Form of Original Note No. 1 for $75,500,000, Cusip No. 20266P AA 9,
with Guarantee of Guarantors listed therein. Incorporated by
reference to the Company's S-4.
4.3 -- Form of New Note with Form of New Guarantee. Incorporated by reference to the
Company's S-4.
4.4 -- Registration Rights Agreement dated as of April 21, 1995, by and
among the Company, the Guarantors named therein and each of the
Purchasers referred to therein. Incorporated by reference to the
Company's S-4.
10.1 -- Securities Purchase Agreement dated as of April 13, 1995, by and
among the Company, the Guarantors named therein and each of the
Purchasers referred to therein. Incorporated by reference to the
Company's S-4.
10.2 -- Note No. 1 for $1,308,000, Cusip No. 20266 AA 9, with Guarantee of
Guarantors listed therein. Incorporated by reference to the
Company's S-4.
10.3++ -- 1995 Stock Option Plan of the Company. Incorporated by reference to the Company's
S-4.
10.4 -- Sales and Marketing Agreement between Commodore Media of
Pennsylvania, Inc. (formerly known as CRB Broadcasting of
Pennsylvania, Inc.) and East Penn Broadcasting, Inc. with respect to
station WKAP-AM (formerly WXKW-AM). Incorporated by reference to the
Company's S-4.
10.5.1++-- Amended and Restated Employment Agreement dated April 21, 1995, by
and between the Company and Bruce A. Friedman. Incorporated by
reference to the Company's S-4.
10.5.2++-- Amendment No. 1 to Amended and Restated Employment Agreement between
the Company and Bruce A. Friedman. Incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1995, File No. 33-92732.
10.6.1++-- Amended and Restated Employment Agreement dated April 21, 1995, by
and between the Company and James T. Shea, Jr. Incorporated by
reference to the Company's Annual Report on Form 10-K for the year
ended December 31, 1995, File No. 33-92732.
10.6.2++-- Amended and Restated Employment Agreement dated October 16, 1996,
between the Company and James T. Shea, Jr. Incorporated by reference
to the Company's Current Report on Form 8-K, dated October 16, 1996,
File No. 33-92732.
10.7++ -- Employment Agreement dated July 1, 1995, by and between the Company
and Charlie V. DiToro. Incorporated by reference to the Company's
Annual Report on Form 10-K for the year ended December 31, 1995, File
No. 33-92732.
10.8++ -- Employment Agreement dated as of April 21, 1995, by and between the
Company and Jay Sterin. Incorporated by reference to the Company's
Annual Report on Form 10-K for the year ended December 31, 1995, File
No. 33-92732.
10.9.1++-- Employment Agreement dated July 1, 1994, between Osborn and Frank D.
Osborn. Incorporated by reference to Osborn's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1994, File No. 0-16841.
10.9.2++-- Amendment No. 1 dated July 1, 1996 to the employment agreement dated
July 1, 1994 between Osborn and Frank D. Osborn. Incorporated by
reference to Osborn's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1996, File No. 0-16841.
10.9.3++-- Amendment No. 2 dated July 23, 1996 to the employment agreement dated
July 1, 1994 between Osborn and Frank D. Osborn. Incorporated by
reference to Osborn's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1996, File No. 0-16841.
10.9.4*++-- Employment Agreement dated February 20, 1997, between Osborn and
Frank D. Osborn.
10.10 -- Promissory Note, dated April 21, 1995, in the aggregate principal
amount of $900,000, issued by Bruce A. Friedman to Carter Burden as
security for Class A shares held by Mr. Friedman. Incorporated by
reference to the Company's S-4.
</TABLE>
<PAGE> 102
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE PAGE
------ ------------- ----
<S> <C> <C>
10.11 -- Promissory Note, dated April 21, 1995, in the aggregate principal
amount $208,000, issued by James T. Shea, Jr. to Carter Burden as
security for Class A shares held by Mr. Shea. Incorporated by
reference to the Company's S-4.
10.12 -- Promissory Note, dated as of May 15, 1995, in the aggregate principal
amount $50,215, issued by Carter burden to the Company. Incorporated
by reference to the Company's S-4.
10.13 -- Promissory Note, dated as of May 15, 1995, in the aggregate principal
amount $100,160, issued by Bruce A. Friedman to the Company.
Incorporated by reference to the Company's S-4.
10.14 -- Promissory Note, dated as of May 15, 1995, in the aggregate principal
amount $50,000, issued by James T. Shea, Jr. to the Company.
Incorporated by reference to the Company's S-4.
10.15 -- Promissory Note, dated as of May 15, 1995, in the aggregate principal
amount $50,000, issued by James J. Sullivan to the Company.
Incorporated by reference to the Company's S-4.
10.16 -- Option Purchase Agreement dated as of March 17, 1995, between
Treasure Coast Media, Inc. ("Treasure Coast") and Commodore Media of
Florida, Inc. Incorporated by reference to the Company's Annual
Report on Form 10-K for the year ended December 31, 1995, File No.
33-92732.
10.17 -- Sales Local Marketing Agreement dated as of March 17, 1995, between
Commodore Media of Florida, Inc. (formerly known as CRB Broadcasting
of Florida, Inc.) and Treasure Coast Media, Inc. with respect to
station WPAW-FM (formerly WZZR-FM). Incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1995, File No. 33-92732.
10.18 -- Loan and Security Agreement dated as of March 13, 1996, among CHI, as
Borrower, the Company, Commodore Media of Delaware, Inc., Commodore
Media of Pennsylvania, Inc., Commodore Media of Florida, Inc.,
Commodore Media of Kentucky, Inc., Commodore Media of Norwalk, Inc.
and Commodore Media of Westchester, Inc., as Guarantors, and AT&T
Commercial Finance Corporation, as Lender. Incorporated by reference
to the Company's Annual Report on Form 10-K for the year ended
December 31, 1995, File No. 33-92732.
10.19 -- Supplement No. 1 to the Loan Agreement. Incorporated by reference to
the Company's Annual Report on Form 10-K for the year ended December
31, 1995, File No. 33-92732.
10.20++ -- Employment Agreement dated as of April 21, 1995, by and between the
Company and Scott J. Bacherman. Incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1995, File No. 33-92732.
10.21++ -- Employment Agreement dated as of April 21, 1995, by and between the
Company and Judy Jennings. Incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1995, File No. 33-92732.
10.22++ -- Employment Agreement dated as of April 21, 1995, by and between the
Company and James J. Sullivan. Incorporated by reference to the
Company's Annual Report on Form 10-K for the year ended December 31,
1995, File No. 33-92732.
10.23++ -- Employment Agreement dated as of July 1, 1995, by and between the
Company and Rich Lewis. Incorporated by reference to the Company's
Annual Report on Form 10-K for the year ended December 31, 1995, File
No. 33-92732.
10.24 -- Local Marketing Agreement dated April 8, 1996, between Commodore Media of Kentucky and
Simmons Broadcasting Company with respect to station WHRD-AM. Incorporated by
reference to the Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 1996, File No. 33-92732.
10.25* -- Form Indemnification Agreement between Osborn and each of its directors and officers.
10.26 -- Credit Agreement dated February 20, 1997, among the Company, as borrower, Capstar, as
guarantor, various banks, and Bankers Trust Company, as administrative
</TABLE>
<PAGE> 103
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE PAGE
------ ------------- ----
<S> <C> <C>
agent. Incorporated by reference to the Company's Current Report on Form 8-K dated
February 20, 1997.
10.27 -- Osborn Communications Corporation Deferred Compensation Plan.
Incorporated by reference to Osborn's Annual Report on Form 10-K for
the year ended December 31, 1994, File No. 0-16841.
10.28 -- Osborn Communications Corporation Deferred Compensation Plan.
Incorporated by reference to Osborn's Annual Report on Form 10-K for
the year ended December 31, 1995, File No. 0-16841.
10.29 -- Loan Agreement by and among Osborn, Society National Bank, and the Financial
Institutions Listed Herein as of August 18,1995. Incorporated by reference to
Osborn's Quarterly Report on Form 10-Q for the quarter ended September 30, 1995, File
No. 0-16841.
10.30 -- Option Agreement, dated December 21, 1995, between RKZ Television,
Inc. and Allbritton Communications Corporation. Incorporated by
reference to Osborn's Annual Report on Form 10-K for the year ended
December 31, 1995, File No. 0-16841.
10.31* -- Credit Agreement dated as of March 14, 1997, among Emerald City Radio
Partners, L.P., as borrower, and Commodore Media, Inc., as lender.
21.1* -- Subsidiaries of the Company.
27.1* -- Financial Data Schedule.
</TABLE>
_______________
* Filed herewith.
+ The Company will furnish upon request of the Commission any omitted
schedule or exhibit.
++ Executive Compensation plan or arrangement.
<PAGE> 1
EXHIBIT 3.1.2
CERTIFICATE OF AMENDMENT
TO
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
OF
COMMODORE MEDIA, INC.
(Incorporated on August 5, 1980)
(Pursuant to Section 242 of the General Corporation
Law of the State of Delaware)
- --------------------------------------------------------------------------------
Commodore Media, Inc., a corporation organized and existing under and
by virtue of the General Corporation Law of the State of Delaware (the
"Corporation"), hereby certifies:
FIRST, that the board of directors of the Corporation duly adopted a
resolution proposing and declaring advisable the following amendment to the
Amended and Restated Certificate of Incorporation of the Corporation in
accordance with the provisions of Section 242 of the General Corporation Law of
the State of Delaware:
RESOLVED, that the Board of Directors of the Corporation deems
and declares advisable an amendment to the Amended and Restated
Certificate of Incorporation of the Corporation to amend Article Four
to read in its entirety as follows; and that such amendment be
submitted to the stockholders of the Corporation for their
consideration and approval:
ARTICLE FOUR
AUTHORIZED STOCK
The total number of shares of all classes of stock
which the corporation shall have authority to issue is
350,000,000 shares of Common Stock of the par value of One
Cent ($.01) per share.
Immediately upon the filing of this Certificate of
Amendment with the Secretary of State of Delaware, each share
of previously authorized Class A Common Stock and Class B
Common Stock of the Corporation ("Old Common Stock") issued
and outstanding immediately before the filing hereof shall be
reclassified and immediately represent One Hundred Six
Thousand Seven Hundred and Fifty-Seven (106,757) validly
issued, fully paid and non-assessable shares of Common Stock.
Each certificate which theretofore represented share of Old
<PAGE> 2
Common Stock shall thereafter represent that number of shares
of Common Stock determined in the previous sentence; provided
however, that each person holding of record a stock
certificate or certificates which represented shares of Old
Common Stock shall receive, upon surrender of such certificate
or certificates, together with such additional information as
shall be required by the Corporation, a new certificate or
certificates evidencing and representing the number of shares
of Common Stock to which such person is entitled.
SECOND, that in lieu of a meeting and vote of the sole stockholder of
the Corporation, the stockholder of the Corporation has given written consent
to said amendment in accordance with the provisions of Section 228(a) of the
General Corporation Law of the State of Delaware.
THIRD, that the previously stated amendment to the Amended and
Restated Certificate of Incorporation of the Corporation was duly adopted by
the sole stockholder of the Corporation in accordance with the provisions of
Section 242 and of the General Corporation Law of the State of Delaware.
<PAGE> 3
IN WITNESS WHEREOF, the undersigned has executed this Certificate this
20th day of February, 1997.
COMMODORE MEDIA, INC.
By: /s/ William S. Banowsky, Jr.
------------------------------------
William S. Banowsky, Jr.
Vice President
3
<PAGE> 1
EXHIBIT 3.1.4
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
COMMODORE MEDIA, INC.
The undersigned, being the duly elected and acting Secretary of
Commodore Media, Inc. (the "Corporation"), hereby certifies that Article IV of
the Bylaws of the Corporation has been amended, effective November 4, 1996, by
the Board of Directors by addeing the following Section 9 thereto:
"Section 9. Unless otherwise directed by the Board of
Directors, the chief executive officer shall have power to vote and
otherwise act on behalf of the Corporation, in person or by proxy, at
any meeting of security holders of or with respect to any action of
security holders of any other corporation in which this Corporation
may hold securities and otherwise to exercise any and all rights and
powers which this Corporation may possess by reason of its ownership
of securities in such other corporation."
Dated: November 4, 1996
/s/ James J. Sullivan
-----------------------------
James J. Sullivan, Secretary
<PAGE> 1
EXHIBIT 3.2.3
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
COMMODORE MEDIA OF DELAWARE, INC.
The undersigned, being the duly elected and acting Secretary of
Commodore Media of Delaware, Inc. (the "Corporation"), hereby certifies that
Article IV of the Bylaws of the Corporation has been amended, effective
November 4, 1996, by the Board of Directors to read in its entirety as set
forth in Exhibit I attached hereto.
Dated: November 4, 1996
/s/ James J. Sullivan
----------------------------
James J. Sullivan, Secretary
<PAGE> 2
EXHIBIT I
AMENDMENT TO BYLAWS OF THE CORPORATION
ARTICLE III
OFFICERS
SECTION 1. The officers of the Corporation shall be a President,
one or more Vice Presidents (any one or more of whom may be designated
Executive Vice President or Senior Vice President), a Treasurer, a Secretary
and, if the Board of Directors so elects, a Chairman of the Board and such
other officers as the Board of Directors may from time to time elect or
appoint. Each officer shall hold office until his successor shall be duly
elected and shall qualify or until his death or until he shall resign or shall
have been removed in the manner hereinafter provided. Any number of offices
may be held by the same person, unless the Certificate of Incorporation
provides otherwise. Except for the Chairman of the Board, if any, no officer
need be a director.
SECTION 2. The salaries or other compensation of the officers
and agents of the Corporation shall be fixed from time to time by the Board of
Directors.
SECTION 3. Any officer or agent elected or appointed by the
Board of Directors may be removed, either with or without cause, by the vote of
a majority of the whole Board of Directors at a special meeting called for the
purpose, or at any regular meeting of the Board of Directors, provided the
notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
SECTION 4. Any vacancy occurring in any office of the
Corporation may be filled by the Board of Directors.
SECTION 5. The President shall be the chief executive officer of
the Corporation unless the Board of Directors elects or appoints a chief
executive officer or designates the Chairman of the Board as chief executive
officer. Subject to the control of the Board of Directors and the executive
committee (if any), the chief executive officer shall have general executive
charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
unless the Board of Directors otherwise determines, the chief executive officer
shall, in the absence of the Chairman of the Board or if there be no Chairman
of the Board, preside at all meetings of the stockholders and (should he be a
director) of the Board of Directors; and shall have such other powers and
duties as designated in accordance with these bylaws and as from time to time
may be assigned to him by the Board of Directors.
SECTION 6. If elected, the Chairman of the Board shall preside
at all meetings of the stockholders and of the Board of Directors; and he shall
have such other powers and duties as
<PAGE> 3
designated in these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 7. Unless the Board of Directors otherwise determines,
the President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the
Corporation; and, unless the Board of Directors otherwise determines, he shall,
in the absence of the Chairman of the Board and the chief executive officer or
if there be no Chairman of the Board or chief executive officer, preside at all
meetings of the stockholders and (should he be a director) of the Board of
Directors; and he shall have such other powers and duties as designated in
accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 8. In the absence of the President, or in the event of
his inability or refusal to act, a Vice President designated by the Board of
Directors shall perform the duties of the President, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
President. In the absence of a designation by the Board of Directors of a Vice
President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
SECTION 9. The Treasurer shall have responsibility for the
custody and control of all the funds and securities of the Corporation, and he
shall have such other powers and duties as designated in these bylaws and as
from time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control
of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge
of his duties in such form as the Board of Directors may require.
SECTION 10. Each Assistant Treasurer shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officer's
absence or inability or refusal to act.
SECTION 11. The Secretary shall keep the minutes of all meetings
of the Board of Directors, committees of directors and the stockholders, in
books provided for that purpose; he shall attend to the giving and serving of
all notices; he may in the name of the Corporation affix the seal of the
Corporation to all contracts of the Corporation and attest the affixation of
the seal of the Corporation thereto; he may sign with the other appointed
officers all certificates for shares of capital stock of the Corporation; he
shall have charge of the certificate books, transfer books and stock ledgers,
and such other books and papers as the Board of Directors may direct, all of
which shall at all reasonable times be open to inspection of any director upon
application at the office of the Corporation during business hours; he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors; and he shall in
general perform all acts incident to the office of Secretary, subject to the
control of the chief executive officer and the Board of Directors.
<PAGE> 4
SECTION 12. Each Assistant Secretary shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officer's
absence or inability or refusal to act.
SECTION 13. Unless otherwise directed by the Board of Directors,
the chief executive officer shall have power to vote and otherwise act on
behalf of the Corporation, in person or by proxy, at any meeting of security
holders of or with respect to any action of security holders of any other
corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other corporation.
<PAGE> 1
EXHIBIT 3.3.3
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
COMMODORE MEDIA OF PENNSYLVANIA, INC.
The undersigned, being the duly elected and acting Secretary of
Commodore Media of Pennsylvania, Inc. (the "Corporation"), hereby certifies
that Article IV of the Bylaws of the Corporation has been amended, effective
November 4, 1996, by the Board of Directors to read in its entirety as set
forth in Exhibit I attached hereto.
Dated: November 4, 1996
/s/ James J. Sullivan
----------------------------
James J. Sullivan, Secretary
<PAGE> 2
EXHIBIT I
AMENDMENT TO BYLAWS OF THE CORPORATION
ARTICLE III
OFFICERS
SECTION 1. The officers of the Corporation shall be a President,
one or more Vice Presidents (any one or more of whom may be designated
Executive Vice President or Senior Vice President), a Treasurer, a Secretary
and, if the Board of Directors so elects, a Chairman of the Board and such
other officers as the Board of Directors may from time to time elect or
appoint. Each officer shall hold office until his successor shall be duly
elected and shall qualify or until his death or until he shall resign or shall
have been removed in the manner hereinafter provided. Any number of offices
may be held by the same person, unless the Certificate of Incorporation
provides otherwise. Except for the Chairman of the Board, if any, no officer
need be a director.
SECTION 2. The salaries or other compensation of the officers
and agents of the Corporation shall be fixed from time to time by the Board of
Directors.
SECTION 3. Any officer or agent elected or appointed by the
Board of Directors may be removed, either with or without cause, by the vote of
a majority of the whole Board of Directors at a special meeting called for the
purpose, or at any regular meeting of the Board of Directors, provided the
notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
SECTION 4. Any vacancy occurring in any office of the
Corporation may be filled by the Board of Directors.
SECTION 5. The President shall be the chief executive officer of
the Corporation unless the Board of Directors elects or appoints a chief
executive officer or designates the Chairman of the Board as chief executive
officer. Subject to the control of the Board of Directors and the executive
committee (if any), the chief executive officer shall have general executive
charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
unless the Board of Directors otherwise determines, the chief executive officer
shall, in the absence of the Chairman of the Board or if there be no Chairman
of the Board, preside at all meetings of the stockholders and (should he be a
director) of the Board of Directors; and shall have such other powers and
duties as designated in accordance with these bylaws and as from time to time
may be assigned to him by the Board of Directors.
SECTION 6. If elected, the Chairman of the Board shall preside
at all meetings of the stockholders and of the Board of Directors; and he shall
have such other powers and duties as
<PAGE> 3
designated in these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 7. Unless the Board of Directors otherwise determines,
the President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the
Corporation; and, unless the Board of Directors otherwise determines, he shall,
in the absence of the Chairman of the Board and the chief executive officer or
if there be no Chairman of the Board or chief executive officer, preside at all
meetings of the stockholders and (should he be a director) of the Board of
Directors; and he shall have such other powers and duties as designated in
accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 8. In the absence of the President, or in the event of
his inability or refusal to act, a Vice President designated by the Board of
Directors shall perform the duties of the President, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
President. In the absence of a designation by the Board of Directors of a Vice
President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
SECTION 9. The Treasurer shall have responsibility for the
custody and control of all the funds and securities of the Corporation, and he
shall have such other powers and duties as designated in these bylaws and as
from time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control
of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge
of his duties in such form as the Board of Directors may require.
SECTION 10. Each Assistant Treasurer shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officer's
absence or inability or refusal to act.
SECTION 11. The Secretary shall keep the minutes of all meetings
of the Board of Directors, committees of directors and the stockholders, in
books provided for that purpose; he shall attend to the giving and serving of
all notices; he may in the name of the Corporation affix the seal of the
Corporation to all contracts of the Corporation and attest the affixation of
the seal of the Corporation thereto; he may sign with the other appointed
officers all certificates for shares of capital stock of the Corporation; he
shall have charge of the certificate books, transfer books and stock ledgers,
and such other books and papers as the Board of Directors may direct, all of
which shall at all reasonable times be open to inspection of any director upon
application at the office of the Corporation during business hours; he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors; and he shall in
general perform all acts incident to the office of Secretary, subject to the
control of the chief executive officer and the Board of Directors.
<PAGE> 4
SECTION 12. Each Assistant Secretary shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officer's
absence or inability or refusal to act.
SECTION 13. Unless otherwise directed by the Board of Directors,
the chief executive officer shall have power to vote and otherwise act on
behalf of the Corporation, in person or by proxy, at any meeting of security
holders of or with respect to any action of security holders of any other
corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other corporation.
<PAGE> 1
EXHIBIT 3.4.3
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
COMMODORE MEDIA OF FLORIDA, INC.
The undersigned, being the duly elected and acting Secretary of
Commodore Media of Florida, Inc. (the "Corporation"), hereby certifies that
Article IV of the Bylaws of the Corporation has been amended, effective
November 4, 1996, by the Board of Directors to read in its entirety as set forth
in Exhibit I attached hereto.
Dated: November 4, 1996
/s/ James J. Sullivan
----------------------------
James J. Sullivan, Secretary
<PAGE> 2
EXHIBIT I
AMENDMENT TO BYLAWS OF THE CORPORATION
ARTICLE III
OFFICERS
SECTION 1. The officers of the Corporation shall be a President,
one or more Vice Presidents (any one or more of whom may be designated
Executive Vice President or Senior Vice President), a Treasurer, a Secretary
and, if the Board of Directors so elects, a Chairman of the Board and such
other officers as the Board of Directors may from time to time elect or
appoint. Each officer shall hold office until his successor shall be duly
elected and shall qualify or until his death or until he shall resign or shall
have been removed in the manner hereinafter provided. Any number of offices
may be held by the same person, unless the Certificate of Incorporation
provides otherwise. Except for the Chairman of the Board, if any, no officer
need be a director.
SECTION 2. The salaries or other compensation of the officers
and agents of the Corporation shall be fixed from time to time by the Board of
Directors.
SECTION 3. Any officer or agent elected or appointed by the
Board of Directors may be removed, either with or without cause, by the vote of
a majority of the whole Board of Directors at a special meeting called for the
purpose, or at any regular meeting of the Board of Directors, provided the
notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
SECTION 4. Any vacancy occurring in any office of the
Corporation may be filled by the Board of Directors.
SECTION 5. The President shall be the chief executive officer of
the Corporation unless the Board of Directors elects or appoints a chief
executive officer or designates the Chairman of the Board as chief executive
officer. Subject to the control of the Board of Directors and the executive
committee (if any), the chief executive officer shall have general executive
charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
unless the Board of Directors otherwise determines, the chief executive officer
shall, in the absence of the Chairman of the Board or if there be no Chairman
of the Board, preside at all meetings of the stockholders and (should he be a
director) of the Board of Directors; and shall have such other powers and
duties as designated in accordance with these bylaws and as from time to time
may be assigned to him by the Board of Directors.
SECTION 6. If elected, the Chairman of the Board shall preside
at all meetings of the stockholders and of the Board of Directors; and he shall
have such other powers and duties as
<PAGE> 3
designated in these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 7. Unless the Board of Directors otherwise determines,
the President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the
Corporation; and, unless the Board of Directors otherwise determines, he shall,
in the absence of the Chairman of the Board and the chief executive officer or
if there be no Chairman of the Board or chief executive officer, preside at all
meetings of the stockholders and (should he be a director) of the Board of
Directors; and he shall have such other powers and duties as designated in
accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 8. In the absence of the President, or in the event of
his inability or refusal to act, a Vice President designated by the Board of
Directors shall perform the duties of the President, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
President. In the absence of a designation by the Board of Directors of a Vice
President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
SECTION 9. The Treasurer shall have responsibility for the
custody and control of all the funds and securities of the Corporation, and he
shall have such other powers and duties as designated in these bylaws and as
from time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control
of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge
of his duties in such form as the Board of Directors may require.
SECTION 10. Each Assistant Treasurer shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officer's
absence or inability or refusal to act.
SECTION 11. The Secretary shall keep the minutes of all meetings
of the Board of Directors, committees of directors and the stockholders, in
books provided for that purpose; he shall attend to the giving and serving of
all notices; he may in the name of the Corporation affix the seal of the
Corporation to all contracts of the Corporation and attest the affixation of
the seal of the Corporation thereto; he may sign with the other appointed
officers all certificates for shares of capital stock of the Corporation; he
shall have charge of the certificate books, transfer books and stock ledgers,
and such other books and papers as the Board of Directors may direct, all of
which shall at all reasonable times be open to inspection of any director upon
application at the office of the Corporation during business hours; he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors; and he shall in
general perform all acts incident to the office of Secretary, subject to the
control of the chief executive officer and the Board of Directors.
<PAGE> 4
SECTION 12. Each Assistant Secretary shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officer's
absence or inability or refusal to act.
SECTION 13. Unless otherwise directed by the Board of Directors,
the chief executive officer shall have power to vote and otherwise act on
behalf of the Corporation, in person or by proxy, at any meeting of security
holders of or with respect to any action of security holders of any other
corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other corporation.
<PAGE> 1
EXHIBIT 3.5.3
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
COMMODORE MEDIA OF KENTUCKY, INC.
The undersigned, being the duly elected and acting Secretary of
Commodore Media of Kentucky, Inc. (the "Corporation"), hereby certifies that
Article IV of the Bylaws of the Corporation has been amended, effective
November 4, 1996, by the Board of Directors to read in its entirety as set
forth in Exhibit I attached hereto.
Dated: November 4, 1996
/s/ James J. Sullivan
-----------------------------
James J. Sullivan, Secretary
<PAGE> 2
EXHIBIT I
AMENDMENT TO BYLAWS OF THE CORPORATION
ARTICLE III
OFFICERS
SECTION 1. The officers of the Corporation shall be a President,
one or more Vice Presidents (any one or more of whom may be designated
Executive Vice President or Senior Vice President), a Treasurer, a Secretary
and, if the Board of Directors so elects, a Chairman of the Board and such
other officers as the Board of Directors may from time to time elect or
appoint. Each officer shall hold office until his successor shall be duly
elected and shall qualify or until his death or until he shall resign or shall
have been removed in the manner hereinafter provided. Any number of offices
may be held by the same person, unless the Certificate of Incorporation
provides otherwise. Except for the Chairman of the Board, if any, no officer
need be a director.
SECTION 2. The salaries or other compensation of the officers
and agents of the Corporation shall be fixed from time to time by the Board of
Directors.
SECTION 3. Any officer or agent elected or appointed by the
Board of Directors may be removed, either with or without cause, by the vote of
a majority of the whole Board of Directors at a special meeting called for the
purpose, or at any regular meeting of the Board of Directors, provided the
notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
SECTION 4. Any vacancy occurring in any office of the
Corporation may be filled by the Board of Directors.
SECTION 5. The President shall be the chief executive officer of
the Corporation unless the Board of Directors elects or appoints a chief
executive officer or designates the Chairman of the Board as chief executive
officer. Subject to the control of the Board of Directors and the executive
committee (if any), the chief executive officer shall have general executive
charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
unless the Board of Directors otherwise determines, the chief executive officer
shall, in the absence of the Chairman of the Board or if there be no Chairman
of the Board, preside at all meetings of the stockholders and (should he be a
director) of the Board of Directors; and shall have such other powers and
duties as designated in accordance with these bylaws and as from time to time
may be assigned to him by the Board of Directors.
SECTION 6. If elected, the Chairman of the Board shall preside
at all meetings of the stockholders and of the Board of Directors; and he shall
have such other powers and duties as
<PAGE> 3
designated in these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 7. Unless the Board of Directors otherwise determines,
the President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the
Corporation; and, unless the Board of Directors otherwise determines, he shall,
in the absence of the Chairman of the Board and the chief executive officer or
if there be no Chairman of the Board or chief executive officer, preside at all
meetings of the stockholders and (should he be a director) of the Board of
Directors; and he shall have such other powers and duties as designated in
accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 8. In the absence of the President, or in the event of
his inability or refusal to act, a Vice President designated by the Board of
Directors shall perform the duties of the President, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
President. In the absence of a designation by the Board of Directors of a Vice
President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
SECTION 9. The Treasurer shall have responsibility for the
custody and control of all the funds and securities of the Corporation, and he
shall have such other powers and duties as designated in these bylaws and as
from time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control
of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge
of his duties in such form as the Board of Directors may require.
SECTION 10. Each Assistant Treasurer shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officer's
absence or inability or refusal to act.
SECTION 11. The Secretary shall keep the minutes of all meetings
of the Board of Directors, committees of directors and the stockholders, in
books provided for that purpose; he shall attend to the giving and serving of
all notices; he may in the name of the Corporation affix the seal of the
Corporation to all contracts of the Corporation and attest the affixation of
the seal of the Corporation thereto; he may sign with the other appointed
officers all certificates for shares of capital stock of the Corporation; he
shall have charge of the certificate books, transfer books and stock ledgers,
and such other books and papers as the Board of Directors may direct, all of
which shall at all reasonable times be open to inspection of any director upon
application at the office of the Corporation during business hours; he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors; and he shall in
general perform all acts incident to the office of Secretary, subject to the
control of the chief executive officer and the Board of Directors.
<PAGE> 4
SECTION 12. Each Assistant Secretary shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officer's
absence or inability or refusal to act.
SECTION 13. Unless otherwise directed by the Board of Directors,
the chief executive officer shall have power to vote and otherwise act on
behalf of the Corporation, in person or by proxy, at any meeting of security
holders of or with respect to any action of security holders of any other
corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other corporation.
<PAGE> 1
EXHIBIT 3.6.3
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
COMMODORE MEDIA OF NORWALK INC.
The undersigned, being the duly elected and acting Secretary of
Commodore Media of Norwalk Inc. (the "Corporation"), hereby certifies that
Article III of the Bylaws of the Corporation has been amended, effective
November 4, 1996, by the Board of Directors to read in its entirety as set
forth in Exhibit I attached hereto.
Dated: November 4, 1996
/s/ James J. Sullivan
----------------------------
James J. Sullivan, Secretary
<PAGE> 2
EXHIBIT I
AMENDMENT TO BYLAWS OF THE CORPORATION
ARTICLE III
OFFICERS
SECTION 1. The officers of the Corporation shall be a President,
one or more Vice Presidents (any one or more of whom may be designated
Executive Vice President or Senior Vice President), a Treasurer, a Secretary
and, if the Board of Directors so elects, a Chairman of the Board and such
other officers as the Board of Directors may from time to time elect or
appoint. Each officer shall hold office until his successor shall be duly
elected and shall qualify or until his death or until he shall resign or shall
have been removed in the manner hereinafter provided. Any number of offices
may be held by the same person, unless the Certificate of Incorporation
provides otherwise. Except for the Chairman of the Board, if any, no officer
need be a director.
SECTION 2. The salaries or other compensation of the officers
and agents of the Corporation shall be fixed from time to time by the Board of
Directors.
SECTION 3. Any officer or agent elected or appointed by the
Board of Directors may be removed, either with or without cause, by the vote of
a majority of the whole Board of Directors at a special meeting called for the
purpose, or at any regular meeting of the Board of Directors, provided the
notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
SECTION 4. Any vacancy occurring in any office of the
Corporation may be filled by the Board of Directors.
SECTION 5. The President shall be the chief executive officer of
the Corporation unless the Board of Directors elects or appoints a chief
executive officer or designates the Chairman of the Board as chief executive
officer. Subject to the control of the Board of Directors and the executive
committee (if any), the chief executive officer shall have general executive
charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
unless the Board of Directors otherwise determines, the chief executive officer
shall, in the absence of the Chairman of the Board or if there be no Chairman
of the Board, preside at all meetings of the stockholders and (should he be a
director) of the Board of Directors; and shall have such other powers and
duties as designated in accordance with these bylaws and as from time to time
may be assigned to him by the Board of Directors.
SECTION 6. If elected, the Chairman of the Board shall preside
at all meetings of the stockholders and of the Board of Directors; and he shall
have such other powers and duties as
<PAGE> 3
designated in these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 7. Unless the Board of Directors otherwise determines,
the President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the
Corporation; and, unless the Board of Directors otherwise determines, he shall,
in the absence of the Chairman of the Board and the chief executive officer or
if there be no Chairman of the Board or chief executive officer, preside at all
meetings of the stockholders and (should he be a director) of the Board of
Directors; and he shall have such other powers and duties as designated in
accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 8. In the absence of the President, or in the event of
his inability or refusal to act, a Vice President designated by the Board of
Directors shall perform the duties of the President, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
President. In the absence of a designation by the Board of Directors of a Vice
President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
SECTION 9. The Treasurer shall have responsibility for the
custody and control of all the funds and securities of the Corporation, and he
shall have such other powers and duties as designated in these bylaws and as
from time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control
of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge
of his duties in such form as the Board of Directors may require.
SECTION 10. Each Assistant Treasurer shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officer's
absence or inability or refusal to act.
SECTION 11. The Secretary shall keep the minutes of all meetings
of the Board of Directors, committees of directors and the stockholders, in
books provided for that purpose; he shall attend to the giving and serving of
all notices; he may in the name of the Corporation affix the seal of the
Corporation to all contracts of the Corporation and attest the affixation of
the seal of the Corporation thereto; he may sign with the other appointed
officers all certificates for shares of capital stock of the Corporation; he
shall have charge of the certificate books, transfer books and stock ledgers,
and such other books and papers as the Board of Directors may direct, all of
which shall at all reasonable times be open to inspection of any director upon
application at the office of the Corporation during business hours; he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors; and he shall in
general perform all acts incident to the office of Secretary, subject to the
control of the chief executive officer and the Board of Directors.
<PAGE> 4
SECTION 12. Each Assistant Secretary shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officer's
absence or inability or refusal to act.
SECTION 13. Unless otherwise directed by the Board of Directors,
the chief executive officer shall have power to vote and otherwise act on
behalf of the Corporation, in person or by proxy, at any meeting of security
holders of or with respect to any action of security holders of any other
corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other corporation.
<PAGE> 1
EXHIBIT 3.7.3
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
COMMODORE MEDIA OF WESTCHESTER, INC.
The undersigned, being the duly elected and acting Secretary of
Commodore Media of Westchester, Inc. (the "Corporation"), hereby certifies that
Article IV of the Bylaws of the Corporation has been amended, effective
November 4,1996, by the Board of Directors to read in its entirety as set forth
in Exhibit I attached hereto.
Dated: November 4, 1996
/s/ James J. Sullivan
-----------------------------
James J. Sullivan, Secretary
<PAGE> 2
EXHIBIT I
AMENDMENT TO BYLAWS OF THE CORPORATION
ARTICLE III
OFFICERS
SECTION 1. The officers of the Corporation shall be a President,
one or more Vice Presidents (any one or more of whom may be designated
Executive Vice President or Senior Vice President), a Treasurer, a Secretary
and, if the Board of Directors so elects, a Chairman of the Board and such
other officers as the Board of Directors may from time to time elect or
appoint. Each officer shall hold office until his successor shall be duly
elected and shall qualify or until his death or until he shall resign or shall
have been removed in the manner hereinafter provided. Any number of offices
may be held by the same person, unless the Certificate of Incorporation
provides otherwise. Except for the Chairman of the Board, if any, no officer
need be a director.
SECTION 2. The salaries or other compensation of the officers
and agents of the Corporation shall be fixed from time to time by the Board of
Directors.
SECTION 3. Any officer or agent elected or appointed by the
Board of Directors may be removed, either with or without cause, by the vote of
a majority of the whole Board of Directors at a special meeting called for the
purpose, or at any regular meeting of the Board of Directors, provided the
notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
SECTION 4. Any vacancy occurring in any office of the
Corporation may be filled by the Board of Directors.
SECTION 5. The President shall be the chief executive officer of
the Corporation unless the Board of Directors elects or appoints a chief
executive officer or designates the Chairman of the Board as chief executive
officer. Subject to the control of the Board of Directors and the executive
committee (if any), the chief executive officer shall have general executive
charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
unless the Board of Directors otherwise determines, the chief executive officer
shall, in the absence of the Chairman of the Board or if there be no Chairman
of the Board, preside at all meetings of the stockholders and (should he be a
director) of the Board of Directors; and shall have such other powers and
duties as designated in accordance with these bylaws and as from time to time
may be assigned to him by the Board of Directors.
SECTION 6. If elected, the Chairman of the Board shall preside
at all meetings of the stockholders and of the Board of Directors; and he shall
have such other powers and duties as
<PAGE> 3
designated in these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 7. Unless the Board of Directors otherwise determines,
the President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the
Corporation; and, unless the Board of Directors otherwise determines, he shall,
in the absence of the Chairman of the Board and the chief executive officer or
if there be no Chairman of the Board or chief executive officer, preside at all
meetings of the stockholders and (should he be a director) of the Board of
Directors; and he shall have such other powers and duties as designated in
accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 8. In the absence of the President, or in the event of
his inability or refusal to act, a Vice President designated by the Board of
Directors shall perform the duties of the President, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
President. In the absence of a designation by the Board of Directors of a Vice
President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
SECTION 9. The Treasurer shall have responsibility for the
custody and control of all the funds and securities of the Corporation, and he
shall have such other powers and duties as designated in these bylaws and as
from time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control
of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge
of his duties in such form as the Board of Directors may require.
SECTION 10. Each Assistant Treasurer shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officer's
absence or inability or refusal to act.
SECTION 11. The Secretary shall keep the minutes of all meetings
of the Board of Directors, committees of directors and the stockholders, in
books provided for that purpose; he shall attend to the giving and serving of
all notices; he may in the name of the Corporation affix the seal of the
Corporation to all contracts of the Corporation and attest the affixation of
the seal of the Corporation thereto; he may sign with the other appointed
officers all certificates for shares of capital stock of the Corporation; he
shall have charge of the certificate books, transfer books and stock ledgers,
and such other books and papers as the Board of Directors may direct, all of
which shall at all reasonable times be open to inspection of any director upon
application at the office of the Corporation during business hours; he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors; and he shall in
general perform all acts incident to the office of Secretary, subject to the
control of the chief executive officer and the Board of Directors.
<PAGE> 4
SECTION 12. Each Assistant Secretary shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officer's
absence or inability or refusal to act.
SECTION 13. Unless otherwise directed by the Board of Directors,
the chief executive officer shall have power to vote and otherwise act on
behalf of the Corporation, in person or by proxy, at any meeting of security
holders of or with respect to any action of security holders of any other
corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other corporation.
<PAGE> 1
EXHIBIT 3.8.3
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
DANBURY BROADCASTING, INC.
The undersigned, being the duly elected and acting Secretary of
Danbury Broadcasting, Inc. (the "Corporation"), hereby certifies that Article
IV of the Bylaws of the Corporation has been amended, effective November 4,
1996, by the Board of Directors to read in its entirety as set forth in Exhibit
I attached hereto.
Dated: November 4, 1996
/s/ James J. Sullivan
----------------------------
James J. Sullivan, Secretary
<PAGE> 2
EXHIBIT I
AMENDMENT TO BYLAWS OF THE CORPORATION
ARTICLE III
OFFICERS
SECTION 1. The officers of the Corporation shall be a President,
one or more Vice Presidents (any one or more of whom may be designated
Executive Vice President or Senior Vice President), a Treasurer, a Secretary
and, if the Board of Directors so elects, a Chairman of the Board and such
other officers as the Board of Directors may from time to time elect or
appoint. Each officer shall hold office until his successor shall be duly
elected and shall qualify or until his death or until he shall resign or shall
have been removed in the manner hereinafter provided. Any number of offices
may be held by the same person, unless the Certificate of Incorporation
provides otherwise. Except for the Chairman of the Board, if any, no officer
need be a director.
SECTION 2. The salaries or other compensation of the officers
and agents of the Corporation shall be fixed from time to time by the Board of
Directors.
SECTION 3. Any officer or agent elected or appointed by the
Board of Directors may be removed, either with or without cause, by the vote of
a majority of the whole Board of Directors at a special meeting called for the
purpose, or at any regular meeting of the Board of Directors, provided the
notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
SECTION 4. Any vacancy occurring in any office of the
Corporation may be filled by the Board of Directors.
SECTION 5. The President shall be the chief executive officer of
the Corporation unless the Board of Directors elects or appoints a chief
executive officer or designates the Chairman of the Board as chief executive
officer. Subject to the control of the Board of Directors and the executive
committee (if any), the chief executive officer shall have general executive
charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
unless the Board of Directors otherwise determines, the chief executive officer
shall, in the absence of the Chairman of the Board or if there be no Chairman
of the Board, preside at all meetings of the stockholders and (should he be a
director) of the Board of Directors; and shall have such other powers and
duties as designated in accordance with these bylaws and as from time to time
may be assigned to him by the Board of Directors.
SECTION 6. If elected, the Chairman of the Board shall preside
at all meetings of the stockholders and of the Board of Directors; and he shall
have such other powers and duties as
<PAGE> 3
designated in these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 7. Unless the Board of Directors otherwise determines,
the President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the
Corporation; and, unless the Board of Directors otherwise determines, he shall,
in the absence of the Chairman of the Board and the chief executive officer or
if there be no Chairman of the Board or chief executive officer, preside at all
meetings of the stockholders and (should he be a director) of the Board of
Directors; and he shall have such other powers and duties as designated in
accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 8. In the absence of the President, or in the event of
his inability or refusal to act, a Vice President designated by the Board of
Directors shall perform the duties of the President, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
President. In the absence of a designation by the Board of Directors of a Vice
President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
SECTION 9. The Treasurer shall have responsibility for the
custody and control of all the funds and securities of the Corporation, and he
shall have such other powers and duties as designated in these bylaws and as
from time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control
of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge
of his duties in such form as the Board of Directors may require.
SECTION 10. Each Assistant Treasurer shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officer's
absence or inability or refusal to act.
SECTION 11. The Secretary shall keep the minutes of all meetings
of the Board of Directors, committees of directors and the stockholders, in
books provided for that purpose; he shall attend to the giving and serving of
all notices; he may in the name of the Corporation affix the seal of the
Corporation to all contracts of the Corporation and attest the affixation of
the seal of the Corporation thereto; he may sign with the other appointed
officers all certificates for shares of capital stock of the Corporation; he
shall have charge of the certificate books, transfer books and stock ledgers,
and such other books and papers as the Board of Directors may direct, all of
which shall at all reasonable times be open to inspection of any director upon
application at the office of the Corporation during business hours; he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors; and he shall in
general perform all acts incident to the office of Secretary, subject to the
control of the chief executive officer and the Board of Directors.
<PAGE> 4
SECTION 12. Each Assistant Secretary shall have the usual powers
and duties pertaining to his office, together with such other powers and duties
as designated in these bylaws and as from time to time may be assigned to him
by the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officer's
absence or inability or refusal to act.
SECTION 13. Unless otherwise directed by the Board of Directors,
the chief executive officer shall have power to vote and otherwise act on
behalf of the Corporation, in person or by proxy, at any meeting of security
holders of or with respect to any action of security holders of any other
corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other corporation.
<PAGE> 1
EXHIBIT 3.9
RESTATED CERTIFICATE OF INCORPORATION
OF
OSBORN COMMUNICATIONS CORPORATION
Osborn Communications Corporation, a corporation organized and
existing under the laws of the State of Delaware (the "Corporation"), does
hereby certify as follows:
1. The name of the corporation is Osborn Communications
Corporation, and the name under which the corporation was originally
incorporated is Thames Broadcasting Corp. The date of filing of the
Corporation's original Certificate of Incorporation with the Secretary of State
of Delaware was September 20, 1984.
2. The text of the Restated Certificate of Incorporation as
amended or supplemented heretofore is further amended hereby to read as herein
set forth in full:
FIRST: The name of the corporation is Osborn Communications
Corporation.
SECOND: The address of its registered office in the State of
Delaware is Corporation Trust Center, 1209 Orange Street, Wilmington,
Delaware 19801 in New Castle County, Delaware. The name of its
registered agent at such address is The Corporation Trust Company.
THIRD: The nature of the business or purposes to be conducted
or promoted by the corporation is to engage in any lawful act or
activity for which corporations may be organized under the Delaware
General Corporation Law.
FOURTH: The total number of shares of all classes of stock
which the corporation shall have authority to issue is Ten Thousand
(10,000) shares of Common Stock of the par value of One Cent ($0.01)
per share.
FIFTH: The number of directors of the corporation shall be as
specified in, or determined in the manner provided in, the bylaws.
Election of directors need not be by written ballot.
SIXTH: In furtherance of, and not in limitation of, the
powers conferred by statute, the Board of Directors is expressly
authorized to adopt, amend or repeal the bylaws of the corporation.
SEVENTH: Whenever a compromise or arrangement is proposed
between the corporation and its creditors or any class of them and/or
between the corporation and its stockholders or any class of them, any
court of equitable jurisdiction within the State of Delaware may, on
the application in a summary way of the corporation or of any creditor
or stockholder thereof or on the application of any receiver or
receivers appointed for the
<PAGE> 2
corporation under the provisions of Section 291 of Title 8 of the
Delaware Code or on the application of trustees in dissolution or of
any receiver or receivers appointed for the corporation under the
provisions of Section 279 of Title 8 of the Delaware Code order a
meeting of the creditors or class of creditors, and/or of the
stockholders or class of stockholders of the corporation, as the case
may be, to be summoned in such manner as the said court directs. If a
majority in number representing three-fourths in value of the
creditors or class of creditors, and/or of the stockholders or class
of stockholders of the corporation, as the case may be, agree to any
compromise or arrangement and to any reorganization of the corporation
as a consequence of such compromise or arrangement, the said
compromise or arrangement and the said reorganization shall, if
sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all
the stockholders or class of stockholders, of the corporation, as the
case may be, and also on the corporation.
EIGHTH: No director of the corporation shall be liable to the
corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach
of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii)
under Section 174 of the Delaware General Corporation Law, or (iv) for
any transaction from which the director derived an improper personal
benefit. In addition to the circumstances in which a director of the
corporation is not personally liable as set forth in the preceding
sentence, a director of the corporation shall not be liable to the
fullest extent permitted by any amendment to the Delaware General
Corporation Law hereafter enacted that further limits the liability of
a director.
NINTH: The corporation shall have the right, subject to any
express provisions or restrictions contained in this certificate of
incorporation or bylaws of the corporation, from time to time, to
amend this certificate of incorporation or any provision hereof in any
manner now or hereafter provided by law, and all rights and powers of
any kind conferred upon a director or stockholder of this corporation
by this certificate of incorporation or any amendment hereof are
subject to such right of the corporation.
TENTH: The following provisions are included for the purpose
of ensuring that control and management of the corporation remain with
citizens of the United States and corporations formed under the laws
of the Unites States or any of the states of the United States, as
required by the Communications Act of 1934, as the same may be amended
from time to time:
(a) The corporation shall not issue to (i) a
person who is a citizen of a country other than the United States;
any entity organized under the laws of a government other than the
government of the United States or any state, territory, or possession
of the United States; (ii) a government other than the government of
the United States or of any state, territory, or possession of the
United States; or (iii) a representative of, or an individual or
entity controlled by, any of the foregoing (individually, an "Alien";
collectively, "Aliens") any shares of capital stock of the corporation
if such issuance would result in the total number of shares of such
capital stock held or voted by Aliens (or for or by the account of
Aliens) exceeding 25% of
<PAGE> 3
(x) the total equity of the corporation outstanding at any time and
from time to time or (y) the total voting power of all shares of such
capital stock outstanding and entitled to vote at any time and from
time to time and shall nor permit the transfer on the books of the
corporation of any capital stock to any Alien that would result in the
total number of shares of such capital stock held or voted by Aliens
(or for or by the account of Aliens) exceeding such 25% limits.
(b) No Alien or Aliens, individually or
collectively, directly or indirectly, shall be entitled to vote or
direct or control the vote of more than 25% of (i) the total equity
of the corporation outstanding at any time and from time to time or
(ii) the total voting power of all shares of capital stock of the
corporation outstanding and entitled to vote at any time and from time
to time, and issuances and transfers of capital stock of the
corporation in violation of this subsection (b) shall be prohibited.
(c) The Board of Directors shall have all powers
necessary to implement the provisions of this Article TENTH and to
ensure compliance with the alien ownership restrictions (the "Alien
Ownership Restrictions") of the Communications Act of 1934, as
amended, and the rules and regulations promulgated thereunder, as the
same may be amended from time to time (collectively, the
"Communications Act"), including, without limitation, the power to
prohibit the transfer of any shares of capital stock of the
corporation to any Alien and to take or cause to be taken such action
as it deems appropriate to implement such prohibition, including
placing a legend regarding restrictions on foreign ownership of the
capital stock on certificates representing such stock.
(d) Without limiting the generality of the
foregoing and notwithstanding any other provision of this Certificate
of Incorporation to the contrary, all shares of capital stock of the
corporation determined by the Board of Directors to be owned
beneficially by an Alien or Aliens or an entity directly or indirectly
owned by Aliens in whole or in part shall always be subject to
redemption by the corporation by action of the Board of Directors,
pursuant to Section 151 of the General Corporation Law of the State of
Delaware, or any other applicable provision of law, to the extent
necessary in the judgment of the Board of Directors to comply with the
Alien Ownership Restrictions. The terms and conditions of such
redemption shall be as follows:
(i) the redemption price of the shares
to be redeemed pursuant to this Article TENTH shall be equal
to the lower of (A) the fair market value of the shares to be
redeemed, as determined by the Board of Directors in good
faith, and (B) such Alien's purchase price for such shares;
(ii) the redemption price of such shares
may be paid in cash, securities or any combination thereof;
(iii) if less than all the shares held by
Aliens are to be redeemed, the shares to be redeemed shall be
selected in any manner determined by the Board of Directors to
be fair and equitable;
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<PAGE> 4
(iv) at least 10 days' written notice of
the redemption date shall be given to the holders of record of
the shares selected to be redeemed (unless waived in writing
by any such holder), provided that the redemption date may be
the date on which written notice shall be given to holders if
the cash or securities necessary to effect the redemption
shall have been deposited in trust for the benefit of such
holders and subject to immediate withdrawal by them upon
surrender of the stock certificates for their shares to be
redeemed duly endorsed in blank or accompanied by duly
executed proper instruments of transfer;
(v) from and after the redemption date,
the shares to be redeemed shall cease to be regarded as
outstanding and any and all rights of the holders in respect
of the shares to be redeemed or attaching to such shares of
whatever nature (including without limitation any rights to
vote or participate in dividends declared on stock of the same
class or series as such shares) shall cease and terminate, and
the holders thereof thereafter shall be entitled only to
receive the cash or securities payable upon redemption; and
(vi) such other terms and conditions as
the Board of Directors shall determine.
For purposes of this Article TENTH, the determination of beneficial
ownership of shares of capital stock of the corporation shall be made
pursuant to Rule 13d-3 under the Securities Exchange Act of 1934,
unless otherwise required by the Alien Ownership Restrictions.
3. This Restated Certificate of Incorporation is being filed
pursuant to Sections 242 and 245 of the General Corporation Law of the State of
Delaware. The Restated Certificate of Incorporation has been duly authorized
in accordance with the General Corporation Law of the State of Delaware by the
Board of Directors of the Corporation, by unanimous written consent pursuant to
Section 141(f) of the Delaware General Corporation Law, dated February 20,
1997, and by the sole stockholder of the Corporation, by written consent on
February 20, 1997. The vote required was a majority of the outstanding shares
of Common Stock of the Corporation.
[Remainder of page intentionally left blank]
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<PAGE> 5
IN WITNESS WHEREOF, Osborn Communications Corporation has caused this
Restated Certificate of Incorporation to be signed by Frank D. Osborn, its
President, this 20th day of February, 1997.
OSBORN COMMUNICATIONS CORPORATION
By: /s/ Frank D. Osborn
-------------------------------
Frank D. Osborn, President
<PAGE> 1
EXHIBIT 3.10
CERTIFICATE OF INCORPORATION
of
ASHVILLE BROADCASTING CORP.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is Ashville Broadcasting
Corp. (the "Corporation").
2. Address; Registered Office and Agent. The address of the
Corporation's registered office is 32 Loockerman Square, Suite L-100, City of
Dover, County of Kent, State of Delaware; and its registered agent at such
address is The Prentice-Hall Corporation System, Inc.
3. Purposes. The purpose of the Corporation is to engage in,
carry on and conduct any lawful act or activity for which corporations may be
organized under the Delaware General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are: Heather S. McDonnell, Osborn Communications
Corporation, 405 Lexington Avenue, 54th Floor, New York, NY 10174.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Limitation of Liability. No Director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a Director,
<PAGE> 2
except for liability (a) for any breach of the Director's duty of loyalty to
the Corporation or its stockholders, (b) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(c) under Section 174 of the Delaware General Corporation Law or (d) for any
transaction from which the Director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a Director of the Corporation existing at the time of such repeal
or modification.
8. Indemnification.
8.1 To the extent not prohibited by law, the Corporation
shall indemnify any person who is or was made, or threatened to be made, a
party to any threatened, pending or completed action, suit or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative,
including, without limitation, an action by or in the right of the Corporation
to procure a judgment in its favor, by reason of the fact that such person, or
a person of whom such person is the legal representative, is or was a Director
or officer of the Corporation, or is or was serving in any capacity at the
request of the Corporation for any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise (an "Other Entity"),
against judgments, fines, penalties, excise taxes, amounts paid in settlement
and costs, charges and expenses (including attorneys' fees and disbursements).
Persons who are not Directors or officers of the Corporation may be similarly
indemnified in respect of service to the Corporation or to an Other Entity at
the request of the Corporation to the extent the Board at any time specifies
that such persons are entitled to the benefits of this Section 8.
8.2 The Corporation shall, from time to time, reimburse or advance
to any Director or officer or other person entitled to indemnification
hereunder the funds necessary for payment of
-2-
<PAGE> 3
expenses, including attorneys' fees and disbursements, incurred in connection
with any Proceeding, in advance of the final disposition of such Proceeding;
provided, however, that, if required by the Delaware General Corporation Law,
such expenses incurred by or on behalf of any Director or officer or other
person may be paid in advance of the final disposition of a Proceeding only
upon receipt by the Corporation of an undertaking, by or on behalf of such
Director of officer (or other person indemnified hereunder), to repay any such
amount so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right of appeal that such Director,
officer or other person is not entitled to be indemnified for such expenses.
8.3 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or reimbursement or advancement of expenses may have or hereafter be entitled
under any statute, this Certificate of Incorporation, the By-laws of the
Corporation (the "By-laws"), any agreement, any vote of stockholders or
disinterested Director or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
8.4 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall continue
as to a person who has ceased to be a Director or officer (or other person
indemnified hereunder) and shall inure to the benefit of the executors,
administrators, legatees and distributees of such person.
8.5 The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a Director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of an Other Entity,
against any liability asserted against such person and incurred by such person
in any such capacity,
-3-
<PAGE> 4
or arising out of such person's status as such, whether or not the Corporation
would have the power to indemnify such person against such liability under the
provisions of this Section 8, the By-laws or under Section 145 of the Delaware
General Corporation Law or any other provision of law.
8.6 The provisions of this Section 8 shall be a contract between
the Corporation, on the one hand, and each Director and officer who serves in
such capacity at any time while this Section 8 is in effect and any other
person indemnified hereunder, on the other hand, pursuant to which the
Corporation and each such Director, officer, or other person intend to be
legally bound. No repeal or modification of this Section 8 shall affect any
rights or obligations with respect to any state of facts then or theretofore
existing or thereafter arising or any proceeding theretofore or thereafter
brought or threatened based in whole or in part upon any such state of facts.
8.7 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall be
enforceable by any person entitled to such indemnification or reimbursement or
advancement of expenses in any court of competent jurisdiction. The burden of
proving that such indemnification or reimbursement or advancement of expenses
is not appropriate shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) to have made a determination prior to the commencement of
such action that such indemnification or reimbursement or advancement of
expenses is proper in the circumstances nor an actual determination by the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) that such person is not entitled to such indemnification
or reimbursement or advancement of expenses shall constitute a defense to the
action or create a presumption that such person is not so entitled. Such a
person shall also be indemnified for any expenses incurred in
-4-
<PAGE> 5
connection with successfully establishing his or her right to such
indemnification or reimbursement or advancement of expenses, in whole or in
part, in any such proceeding.
8.8 Any Director or officer of the Corporation serving in any
capacity (a) another corporation of which a majority of the shares entitled to
vote in the election of its directors is held, directly or indirectly, by the
Corporation or (b) any employee benefit plan of the Corporation or any
corporation referred to in clause (a) shall be deemed to be doing so at the
request of the Corporation.
8.9 Any person entitled to be indemnified or to reimbursement or
advancement of expenses as a matter of right pursuant to this Section 8 may
elect to have the right to indemnification or reimbursement or advancement of
expenses interpreted on the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advance of
expenses is sought. Such election shall be made, by a notice in writing to the
Corporation, at the time indemnification or reimbursement or advancement of
expenses is sought; provided, however, that if no such notice is given, the
right to indemnification or reimbursement or advancement of expenses shall be
determined by the law in effect at the time indemnification or reimbursement of
advancement of expenses is sought.
9. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original By-laws) make, alter or repeal the By-laws by a vote of two-thirds of
the entire Board of Directors that would be in office if no vacancy existed,
whether or not present at a meeting; provided, however, that any By-laws made,
amended or repealed by the Board of Directors may be amended or repealed, and
any By-laws may be made, by the stockholders of the Corporation by a vote of a
majority of the holders of shares of stock of the Corporation entitled to vote
in the election of Directors of the Corporation.
-5-
<PAGE> 6
WITNESS the signature of this Certificate this 22nd of October, 1993.
/s/ Heather S. McDonnell
-----------------------------
Heather S. McDonnell
Incorporator
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<PAGE> 7
CERTIFICATE OF CORRECTION OF
CERTIFICATE OF INCORPORATION
of
ASHVILLE BROADCASTING CORP.
It is hereby certified:
1. The name of the corporation (hereinafter called the
"corporation") is ASHVILLE BROADCASTING CORPORATION.
2. The Certificate of Incorporation of the corporation, which was
filed by the Secretary of the State of Delaware of October 22, 1993, is hereby
corrected.
3. The inaccuracy to be corrected in said instrument is as follows:
The spelling of the corporation in Article One of the
Certificate of Incorporation is incorrect.
4. The portion of the instrument in corrected form is as follows:
The name of the corporation is:
ASHEVILLE BROADCASTING CORP.
SIGNED AND ATTESTED to on October 29, 1993.
/s/ Frank D. Osborn
------------------------------
Frank D. Osborn, President
Attest:
/s/ Heather S. McDonnell
- ----------------------------------
Heather S. McDonnell, Secretary
<PAGE> 1
EXHIBIT 3.11
CERTIFICATE OF INCORPORATION
of
ATLANTIC CITY BROADCASTING CORP.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is Atlantic City
Broadcasting Corp. (the "Corporation").
2. Address; Registered Agent. The address of the Corporation's
registered office is 32 Loockerman Square, Suite L-100, City of Dover 19901,
County of Kent, State of Delaware; and its registered agent at such address is
The Prentice-Hall Corporation System, Inc.
3. Purposes. The purpose of the Corporation is to engage in,
carry on and conduct any lawful act or activity for which corporations may be
organized under the Delaware General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are: Heather S. McDonnell, Osborn Communications
Corporation, 405 Lexington Avenue, 54th Floor, New York, NY 10174.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Limitation of Liability. No Director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a Director
<PAGE> 2
except for liability (a) for any breach of the Director's duty of loyalty to
the Corporation or its stockholders, (b) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(c) under Section 174 of the Delaware General Corporation Law or (d) for any
transaction from which the Director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a Director of the Corporation existing at the time of such repeal
or modification.
8. Indemnification.
8.1 To the extent not prohibited by law, the Corporation
shall indemnify any person who is or was made, or threatened to be made, a
party to any threatened, pending or completed action, suit or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative,
including, without limitation, an action by or in the right of the Corporation
to procure a judgment in its favor, by reason of the fact that such person, or
a person of whom such person is the legal representative, is or was a Director
or officer of the Corporation, or is or was serving in any capacity at the
request of the Corporation for any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise (an "Other Entity"),
against judgments, fines, penalties, excise taxes, amounts paid in settlement
and costs, charges and expenses (including attorneys' fees and disbursements).
Persons who are not Directors or officers of the Corporation may be similarly
indemnified in respect of service to the Corporation or to an Other Entity at
the request of the Corporation to the extent the Board at any time specifies
that such persons are entitled to the benefits of this Section 8.
8.2 The Corporation shall, from time to time, reimburse or advance
to any Director or officer or other person entitled to indemnification
hereunder the funds necessary for payment of
-2-
<PAGE> 3
expenses, including attorneys' fees and disbursements, incurred in connection
with any Proceeding, in advance of the final disposition of such Proceeding;
provided, however, that, if required by the Delaware General Corporation Law,
such expenses incurred by or on behalf of any Director or officer or other
person may be paid in advance of the final disposition of a Proceeding only
upon receipt by the Corporation of an undertaking, by or on behalf of such
Director of officer (or other person indemnified hereunder), to repay any such
amount so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right of appeal that such Director,
officer or other person is not entitled to be indemnified for such expenses.
8.3 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or reimbursement or advancement of expenses may have or hereafter be entitled
under any statute, this Certificate of Incorporation, the By-laws of the
Corporation (the "By-laws"), any agreement, any vote of stockholders or
disinterested Director or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
8.4 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall continue
as to a person who has ceased to be a Director or officer (or other person
indemnified hereunder) and shall inure to the benefit of the executors,
administrators, legatees and distributees of such person.
8.5 The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a Director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of an Other Entity,
against any liability asserted against such person and incurred by such person
in any such capacity,
-3-
<PAGE> 4
or arising out of such person's status as such, whether or not the Corporation
would have the power to indemnify such person against such liability under the
provisions of this Section 8, the By-laws or under Section 145 of the Delaware
General Corporation Law or any other provision of law.
8.6 The provisions of this Section 8 shall be a contract between
the Corporation, on the one hand, and each Director and officer who serves in
such capacity at any time while this Section 8 is in effect and any other
person indemnified hereunder, on the other hand, pursuant to which the
Corporation and each such Director, officer, or other person intend to be
legally bound. No repeal or modification of this Section 8 shall affect any
rights or obligations with respect to any state of facts then or theretofore
existing or thereafter arising or any proceeding theretofore or thereafter
brought or threatened based in whole or in part upon any such state of facts.
8.7 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall be
enforceable by any person entitled to such indemnification or reimbursement or
advancement of expenses in any court of competent jurisdiction. The burden of
proving that such indemnification or reimbursement or advancement of expenses
is not appropriate shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) to have made a determination prior to the commencement of
such action that such indemnification or reimbursement or advancement of
expenses is proper in the circumstances nor an actual determination by the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) that such person is not entitled to such indemnification
or reimbursement or advancement of expenses shall constitute a defense to the
action or create a presumption that such person is not so entitled. Such a
person shall also be indemnified for any expenses incurred in
-4-
<PAGE> 5
connection with successfully establishing his or her right to such
indemnification or reimbursement or advancement of expenses, in whole or in
part, in any such proceeding.
8.8 Any Director or officer of the Corporation serving in any
capacity (a) another corporation of which a majority of the shares entitled to
vote in the election of its directors is held, directly or indirectly, by the
Corporation or (b) any employee benefit plan of the Corporation or any
corporation referred to in clause (a) shall be deemed to be doing so at the
request of the Corporation.
8.9 Any person entitled to be indemnified or to reimbursement or
advancement of expenses as a matter of right pursuant to this Section 8 may
elect to have the right to indemnification or reimbursement or advancement of
expenses interpreted on the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advance of
expenses is sought. Such election shall be made, by a notice in writing to the
Corporation, at the time indemnification or reimbursement or advancement of
expenses is sought; provided, however, that if no such notice is given, the
right to indemnification or reimbursement or advancement of expenses shall be
determined by the law in effect at the time indemnification or reimbursement of
advancement of expenses is sought.
9. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original By-laws) make, alter or repeal the By-laws by a vote of two-thirds of
the entire Board of Directors that would be in office if no vacancy existed,
whether or not present at a meeting; provided, however, that any By-laws made,
amended or repealed by the Board of Directors may be amended or repealed, and
any By-laws may be made, by the stockholders of the Corporation by a vote of a
majority of the holders of shares of stock of the Corporation entitled to vote
in the election of Directors of the Corporation.
-5-
<PAGE> 6
WITNESS the signature of this Certificate this 30th day of November.
/s/ Heather S. McDonnell
------------------------------------
Heather S. McDonnell
Incorporator
-6-
<PAGE> 1
EXHIBIT 3.12
CERTIFICATE OF INCORPORATION
OF
BEATRICE BROADCASTING CORP.
1. The name of the corporation is Beatrice Broadcasting Corp.
2. The address of its registered office in the State of Delaware
is 1209 Orange Street in the City of Wilmington, County of New Castle. The
name of its registered agent at such address is The Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is:
To engage in any lawful act or activity for which
corporations may be organized under the General
Corporation Law of Delaware.
4. The total number of shares of stock which the corporation
shall have authority to issue is One Hundred Ten Thousand (110,000) of which
Ten Thousand shares of the par value of One Dollar ($1.00) each, amounting in
the aggregate to Ten Thousand Dollars ($10,000) shall be preferred stock and of
which One Hundred Thousand (100,000) shares of the par value of one cent ($.01)
each accounting is the aggregate to One Thousand Dollars ($1,000) shall be
common stock.
5. The Board of Directors of the corporation is authorized to
issue the Preferred Stock of the corporation from time to time in one or more
series with distinctive serial designations;
(a) with voting powers, full or limited, or no voting
powers, and such designations, preferences and
relative, participating, option or other special
rights, and qualifications, limitations, or
restrictions;
(b) subject, or not subject too, redemption at such time
or times and at such price or prices;
(c) with the right to receive dividends at such rates, on
such conditions and at such times, and payable in
preference to, or in such relations to, the dividends
payable on any other class or classes or any other
series of stock and cumulative or noncumulative as;
(d) with the rights, upon the dissolution of, or upon
distribution of the assets of the corporation; and
(e) convertible into, or exchangeable for any other class
or classes of stock or any series thereof, of the
corporation at such price or prices or at such rates
of exchange with such adjustments;
<PAGE> 2
as shall be stated in the resolution or resolutions provided for the issue of
such stock adopted by the Board of Directors. Preferred Stock shall not have
any vote except as required by law or as provided in the resolution or
resolutions of the Board of Directors of the corporation delineating the rights
and liabilities of the class or series.
6. The name and mailing address of the incorporator is as
follows:
NAME MAILING ADDRESS
Martin Mushkin Blodnick, Schultz &
Abramowitz, P.C. 3111 New
Hyde Park Road Lake Success,
New York 11042
7. The corporation is to have perpetual existence.
8. In furtherance and not in limitation of the powers conferred
by statute, the board of directors is expressly authorized to make, alter or
repeal the by-laws of the corporation.
9. The corporation reserves the right to amend, alter, change or
repeat any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
10. Any and all right, title, interest and claim in or to any
dividends declared by the corporation, whether in cash, stock, or otherwise,
which are unclaimed by the stockholder entitled thereto for a period of six
years after the close of business on the payment date, shall he deemed to be
extinguished and abandoned; any such unclaimed dividends in the possession of
the corporation, its transfer agents, or other agents or depositories, shall at
such time become the absolute property of the corporation, free and clear of
any and all claims of any persons whatsoever.
11. The corporations shall, to the fullest extent permitted by
Section 145 of the General Corporation Law of the State of Delaware, as the
same may be amended and supplemented, indemnify any and all persons whom it
shall have power to indemnify under said section from and against any and all
of the expenses, liabilities or other matters referred to in or covered by said
section, and the indemnification provided for herein shall not be deemed
exclusive of any other rights to which those indemnified may be entitled under
any By-Law, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in any
other capacity while holding such office, and shall continue as to a person who
has ceased to be director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.
-2-
<PAGE> 3
I, THE UNDERSIGNED, being the sole incorporator hereinbefore
named, for the purpose of forming a corporation pursuant to the
General Corporation Law of the State of Delaware, do make this
Certificate hereby declaring and certifying that this is my act and
deed and the facts herein stated are true, and accordingly, have
hereunto set my hand this 2nd day of August, 1985.
/s/ Martin Mushkin
--------------------------------------
MARTIN MUSHKIN
-3-
<PAGE> 4
CERTIFICATE OF CHANGE OF LOCATION OF REGISTERED OFFICE
AND OF REGISTERED AGENT
It is hereby certified that:
1. The name of the corporation (hereinafter called the "corporation") is
BEATRICE BROADCASTING CORP.
2. The registered office of the corporation within the State of Delaware
is hereby changed to 32 Loockerman Square, Suite L-100, City of Dover 19901,
County of Kent.
3. The registered agent of the corporation within the State of Delaware
is hereby changed to The Prentice-Hall Corporation System, Inc., the business
office of which is identical with the registered office of the corporation as
hereby changed.
4. The corporation has authorized the changes hereinbefore set forth by
resolution of its Board of Directors.
Signed on 7-1, 1993
/s/ Frank D. Osborn
----------------------------------------
Frank D. Osborn - President
Attest:
/s/ Josephine Osborn
- ------------------------------------------------------------
Secretary
<PAGE> 1
EXHIBIT 3.13
CERTIFICATE OF INCORPORATION
of
WHALE WATCH BROADCASTING, INC.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware (the "General Corporation
Law"), certifies as follow:
1. Name. The name of the corporation is Whale Watch Gadsden
Broadcasting, Inc. (the "Corporation").
2. Address; Registered Office and Agent. The address of the
Corporation's registered office is 1013 Centre Road, City of Wilmington, County
of New Castle, 19805, State of Delaware; and its registered agent at such
address is The Prentice-Hall Corporation System, Inc.
3. Purposes. The purpose of the Corporation is to engage in any
lawful act or activity for which corporations may be organized under the
General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
<PAGE> 2
5. Name and Mailing Address of Incorporator. The name and
mailing address of the incorporator are: Linda J. Dunn, Paul, Weiss, Rifkind,
Wharton & Garrison, 1285 Avenue of the Americas, New York, New York
10019-6064.
6. Election of Directors. Members of the Board of Directors of
the Corporation (the "Board") may be elected either by written ballot or by
voice vote.
7. Limitation of Liability. No Director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, provided that this
provision shall not eliminate or limit the liability of a director (a) for any
breach of the director's duty of loyalty to the Corporation or its
stockholders, (b) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (c) under Section 174 of
the General Corporation Law or (d) for any transaction from which the director
derived any improper personal benefits.
Any repeal or modification of the foregoing provision shall not
adversely affect any right or protection of a director of the Corporation
existing at the time of such repeal or modification.
8. Indemnification.
8.1 To the extent not prohibited by law, the Corporation
shall indemnify any person who is or was made, or threatened to be made, a
party to any threatened, pending or completed action, suit or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative,
including, without limitation, an action by or in the right of the Corporation
to procure a judgment in its favor, by reason of the fact that such person, or
a person of whom such person is
-2-
<PAGE> 3
the legal representative, is or was a director or officer of the Corporation,
or, at the request of the Corporation, is or was serving as a director or
officer of any other corporation or in a capacity with comparable authority or
responsibilities for any partnership, joint venture, trust, employee benefit
plan or other enterprise (an "Other Entity"), against judgments, fines,
penalties, excise taxes, amounts paid in settlement and costs, charges and
expenses (including attorneys' fees, disbursements and other charges). Persons
who are not directors or officers of the Corporation(or otherwise entitled to
indemnification pursuant to the preceding sentence) may be similarly
indemnified in respect of service to the Corporation or to an Other Entity at
the request of the Corporation to the extent the Board at any time specifies
that such persons are entitled to the benefits of this Section 8.
8.2 The Corporation shall, from time to time, reimburse or advance
to any director or officer or other person entitled to indemnification
hereunder the funds necessary for payment of expenses, including attorneys'
fees and disbursements, incurred in connection with any Proceeding, in advance
of the final disposition of such Proceeding; provided, however, that, if
required by the General Corporation Law, such expenses incurred by or on behalf
of any director or officer or other person may be paid in advance of the final
disposition of a Proceeding only upon receipt by the Corporation of an
undertaking, by or on behalf of such Director of officer (or other person
indemnified hereunder), to repay any such amount so advanced if it shall
ultimately be determined by final judicial decision from which there is no
further right of appeal that such director, officer or other person is not
entitled to be indemnified for such expenses.
8.3 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or reimbursement or advancement of expenses may have or hereafter be entitled
under any statute, this Certificate of Incorporation, the By-laws of the
-3-
<PAGE> 4
Corporation (the "By-laws"), any agreement, any vote of stockholders or
disinterested director, or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
8.4 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall continue
as to a person who has ceased to be a director or officer (or other person
indemnified hereunder) and shall inure to the benefit of the executors,
administrators, legatees and distributees of such person.
8.5 The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of an Other Entity,
against any liability asserted against such person and incurred by such person
in any such capacity, or arising out of such person's status as such, whether
or not the Corporation would have the power to indemnify such person against
such liability under the provisions of this Section 8, the By-laws or under
Section 145 of the General Corporation Law or any other provision of law.
8.6 The provisions of this Section 8 shall be a contract between
the Corporation, on the one hand, and each Director and officer who serves in
such capacity at any time while this Section 8 is in effect and any other
person entitled to indemnification hereunder, on the other hand, pursuant to
which the Corporation and each such director, officer, or other person intend
to be, and shall be, legally bound. No repeal or modification of this Section
8 shall affect any rights or obligations with respect to any state of facts
then or theretofore existing or thereafter arising or any proceeding
theretofore or thereafter brought or threatened based in whole or in part upon
any such state of facts.
8.7 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall be
enforceable by any person entitled to such
-4-
<PAGE> 5
indemnification or reimbursement or advancement of expenses in any court of
competent jurisdiction. The burden of proving that such indemnification or
reimbursement or advancement of expenses is not appropriate shall be on the
Corporation. Neither the failure of the Corporation (including its Board, its
independent legal counsel and its stockholders) to have made a determination
prior to the commencement of such action that such indemnification or
reimbursement or advancement of expenses is proper in the circumstances nor an
actual determination by the Corporation (including its Board, its independent
legal counsel and its stockholders) that such person is not entitled to such
indemnification or reimbursement or advancement of expenses shall constitute a
defense to the action or create a presumption that such person is not so
entitled. Such a person shall also be indemnified for any expenses incurred in
connection with successfully establishing his or her right to such
indemnification or reimbursement or advancement of expenses, in whole or in
part, in any such proceeding.
8.8 Any Director or officer of the Corporation serving in any
capacity (a) another corporation of which a majority of the shares entitled to
vote in the election of its directors is held, directly or indirectly, by the
Corporation or (b) any employee benefit plan of the Corporation or any
corporation referred to in clause (a) shall be deemed to be doing so at the
request of the Corporation.
8.9 Any person entitled to be indemnified or to reimbursement or
advancement of expenses as a matter of right pursuant to this Section 8 may
elect to have the right to indemnification or reimbursement or advancement of
expenses interpreted on the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advance of
expenses is sought. Such election shall be made, by a notice in writing to the
Corporation, at the time indemnification or reimbursement or
-5-
<PAGE> 6
advancement of expenses is sought; provided, however, that if no such notice is
given, the right to indemnification or reimbursement or advancement of expenses
shall be determined by the law in effect at the time indemnification or
reimbursement of advancement of expenses is sought.
9. Adoption, Amendment and/or Repeal of By-Laws. The Board may
from time to time adopt, amend or repeal the By-laws of the Corporation;
provided, however, that any By-laws adopted or amended by the Board may be
amended or repealed, and any By-laws may be adopted by the stockholders of the
Corporation by a vote of a majority of the holders of shares of stock of the
Corporation entitled to vote in the election of directors of the Corporation.
10. Action by Stockholders Notwithstanding the provisions of
section 228 of the General Corporation Law (or any successor statue), any
action required or permitted by the General Corporation Law to be taken at any
annual or special meeting of stockholders of the Corporation may be taken only
at such an annual or special meeting of stockholders and cannot be taken by
written consent without a meeting.
WITNESS the signature of this Certificate this 22nd day of November,
1995.
/s/ Linda J. Dunn
---------------------------------------
Linda J. Dunn
Incorporator
-6-
<PAGE> 7
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
WHALE WATCH BROADCASTING, INC.
(Pursuant to Section 241 of the General
Corporation Law of the State of Delaware)
Whale Watch Broadcasting, Inc., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), hereby certifies
as follows:
1. The name of the Corporation is Whale Watch Broadcasting, Inc.
2. The Corporation has not received any payment for any of its
stock.
3. This Certificate of Amendment amends the Certificate of
Incorporation now in effect to change the name of the Corporation to
Breadbasket Broadcasting Corporation.
4. This Certificate of Amendment was duly adopted by written
consent, dated as of December 22, 1995, of the sole director of the Corporation
in accordance with Section 141(f) of the General Corporation Law.
5. Section 1 of the Certificate of Incorporation is hereby
amended to read in its entirety as follows:
"1. Name. The name of the Corporation is Breadbasket
Broadcasting Corporation (the "Corporation")."
6. The aforesaid amendment was duly adopted in accordance with
the applicable provision of Section 241 of the General Corporation Law.
<PAGE> 8
IN WITNESS WHEREOF, the Corporation has authorized the undersigned to
execute this Certificate of Amendment this 22nd day of December, 1995.
WHALE WATCH BROADCASTING, INC.
By: /s/ Frank D. Osborn
----------------------------------
Frank D. Osborn
President
ATTEST:
By: /s/ Michael F. Mangan
----------------------------------
Michael F. Mangan
Secretary
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<PAGE> 1
EXHIBIT 3.14
CERTIFICATE OF INCORPORATION
of
FORT MYERS BROADCASTING CORP.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is Fort Myers Broadcasting
Corp. (the "Corporation").
2. Address; Registered Office and Agent. The address of the
Corporation's registered office is 32 Loockerman Square, Suite L-100, City of
Dover, County of Kent, State of Delaware; and its registered agent at such
address is The Prentice-Hall Corporation System, Inc.
3. Purposes. The purpose of the Corporation is to engage in,
carry on and conduct any lawful act or activity for which corporations may be
organized under the Delaware General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and address of Incorporator. The name and mailing
address of the incorporator are: Heather S. McDonnell, Osborn Communications
Corporation, 405 Lexington Avenue, 54th Floor, New York, NY 10174.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Limitation of Liability. No Director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a Director,
<PAGE> 2
except for liability (a) for any breach of the Director's duty of loyalty to
the Corporation or its stockholders, (b) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(c) under Section 174 of the Delaware General Corporation Law or (d) for any
transaction from which the Director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a Director of the Corporation existing at the time of such repeal
or modification.
8. Indemnification.
8.1 To the extent not prohibited by law, the Corporation
shall indemnify any person who is or was made, or threatened to be made, a
party to any threatened, pending or completed action, suit or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative,
including, without limitation, an action by or in the right of the Corporation
to procure a judgment in its favor, by reason of the fact that such person, or
a person of whom such person is the legal representative, is or was a Director
or officer of the Corporation, or is or was serving in any capacity at the
request of the Corporation for any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise (an "Other Entity"),
against judgments, fines, penalties, excise taxes, amounts paid in settlement
and costs, charges and expenses (including attorneys' fees and disbursements).
Persons who are not Directors or officers of the Corporation may be similarly
indemnified in respect of service to the Corporation or to an Other Entity at
the request of the Corporation to the extent the Board at any time specifies
that such persons are entitled to the benefits of this Section 8.
8.2 The Corporation shall, from time to time, reimburse or advance
to any Director or officer or other person entitled to indemnification
hereunder the funds necessary for payment of
-2-
<PAGE> 3
expenses, including attorneys' fees and disbursements, incurred in connection
with any Proceeding, in advance of the final disposition of such Proceeding;
provided, however, that, if required by the Delaware General Corporation Law,
such expenses incurred by or on behalf of any Director or officer or other
person may be paid in advance of the final disposition of a Proceeding only
upon receipt by the Corporation of an undertaking, by or on behalf of such
Director of officer (or other person indemnified hereunder), to repay any such
amount so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right of appeal that such Director,
officer or other person is not entitled to be indemnified for such expenses.
8.3 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or reimbursement or advancement of expenses may have or hereafter be entitled
under any statute, this Certificate of Incorporation, the By-laws of the
Corporation (the "By-laws"), any agreement, any vote of stockholders or
disinterested Director or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
8.4 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall continue
as to a person who has ceased to be a Director or officer (or other person
indemnified hereunder) and shall inure to the benefit of the executors,
administrators, legatees and distributees of such person.
8.5 The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a Director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of an Other Entity,
against any liability asserted against such person and incurred by such person
in any such capacity,
-3-
<PAGE> 4
or arising out of such person's status as such, whether or not the Corporation
would have the power to indemnify such person against such liability under the
provisions of this Section 8, the By-laws or under Section 145 of the Delaware
General Corporation Law or any other provision of law.
8.6 The provisions of this Section 8 shall be a contract between
the Corporation, on the one hand, and each Director and officer who serves in
such capacity at any time while this Section 8 is in effect and any other
person indemnified hereunder, on the other hand, pursuant to which the
Corporation and each such Director, officer, or other person intend to be
legally bound. No repeal or modification of this Section 8 shall affect any
rights or obligations with respect to any state of facts then or theretofore
existing or thereafter arising or any proceeding theretofore or thereafter
brought or threatened based in whole or in part upon any such state of facts.
8.7 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall be
enforceable by any person entitled to such indemnification or reimbursement or
advancement of expenses in any court of competent jurisdiction. The burden of
proving that such indemnification or reimbursement or advancement of expenses
is not appropriate shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) to have made a determination prior to the commencement of
such action that such indemnification or reimbursement or advancement of
expenses is proper in the circumstances nor an actual determination by the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) that such person is not entitled to such indemnification
or reimbursement or advancement of expenses shall constitute a defense to the
action or create a presumption that such person is not so entitled. Such a
person shall also be indemnified for any expenses incurred in
-4-
<PAGE> 5
connection with successfully establishing his or her right to such
indemnification or reimbursement or advancement of expenses, in whole or in
part, in any such proceeding.
8.8 Any Director or officer of the Corporation serving in any
capacity (a) another corporation of which a majority of the shares entitled to
vote in the election of its directors is held, directly or indirectly, by the
Corporation or (b) any employee benefit plan of the Corporation or any
corporation referred to in clause (a) shall be deemed to be doing so at the
request of the Corporation.
8.9 Any person entitled to be indemnified or to reimbursement or
advancement of expenses as a matter of right pursuant to this Section 8 may
elect to have the right to indemnification or reimbursement or advancement of
expenses interpreted on the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advance of
expenses is sought. Such election shall be made, by a notice in writing to the
Corporation, at the time indemnification or reimbursement or advancement of
expenses is sought; provided, however, that if no such notice is given, the
right to indemnification or reimbursement or advancement of expenses shall be
determined by the law in effect at the time indemnification or reimbursement of
advancement of expenses is sought.
9. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original By-laws) make, alter or repeal the By-laws by a vote of two-thirds of
the entire Board of Directors that would be in office if no vacancy existed,
whether or not present at a meeting; provided, however, that any By-laws made,
amended or repealed by the Board of Directors may be amended or repealed, and
any By- laws may be made, by the stockholders of the Corporation by a vote of a
majority of the holders of shares of stock of the Corporation entitled to vote
in the election of Directors of the Corporation.
-5-
<PAGE> 6
WITNESS the signature of this Certificate this 22nd of October, 1993.
/s/ Heather S. McDonnell
-----------------------------------
Heather S. McDonnell
Incorporator
-6-
<PAGE> 7
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
FORT MYERS BROADCASTING CORP.
ADOPTED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 242 OF THE
GENERAL CORPORATION LAW OF THE STATE OF DELAWARE
FORT MYERS BROADCASTING CORP. (the "Corporation"), a corporation
organized and existing under and by virtue of the General Corporation Law of
the State of Delaware (the "GCL") does hereby certify as follows:
1. The name of the Corporation is Fort Myers Broadcasting Corp.
and the original Certificate of Incorporation was filed with
the Secretary of State of the State of Delaware on October 22,
1993.
2. The Certificate of Incorporation is hereby amended by striking
out the First Article thereof and by substituting in lieu of
said First Article the following new First Article:
"1. NAME. The name of the corporation is Corkscrew
Broadcasting Corporation (the "Corporation")."
3. The foregoing amendment was duly adopted in accordance with
Section 242 of the GCL and the sole stockholder of the
outstanding capital stock of the Corporation has consented to
said amendment pursuant to a written consent in accordance
with Section 228 of the GCL.
<PAGE> 8
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be
duly executed this 25th day of July, 1994.
FORT MYERS BROADCASTING CORP.
By: /s/ Michael F. Mangan
-----------------------------------
Name: Michael F. Mangan
Title: Vice President/Controller and
Secretary
Attest:
By: /s/ Lynda Natt
----------------------------
Name: Lynda Natt
Title: Assistant Controller
<PAGE> 1
EXHIBIT 3.15
CERTIFICATE OF INCORPORATION
OF
CURREY BROADCASTING CORPORATION
* * * * *
1. The name of the corporation is
CURREY BROADCASTING CORPORATION
2. The address of its registered office in the State of Delaware
is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington,
County of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is: To engage in the business of owing and operating a radio
station and any and all related activities.
To engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware.
4. The total number of shares of stock which the corporation
shall have authority to issue is One Thousand (1,000) and the par value of each
of such shares is One Dollar ($1.00) amounting in the aggregate to One Thousand
Dollars ($1,000.00).
<PAGE> 2
5. The name and mailing address of each incorporator is as
follows:
NAME MAILING ADDRESS
D. A. Hampton Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
J. A. Grodzicki Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
S. J. Queppet Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
6. The corporation is to have perpetual existence.
7. In furtherance and not in limitation of the powers conferred
by statute, the board of directors is expressly authorized to make, alter or
repeal the by-laws of the corporation.
8. Elections of directors need not be by written ballot unless
the by-laws of the corporation shall so provide.
Meetings of stockholders may be held within or without the State of
Delaware, as the by-laws may provide. The books of the corporation may be kept
(subject to any provision contained in the statutes) outside the State of
Delaware at such place or places as may be designated from time to time by the
board of directors or in the by-laws of the corporation.
-2-
<PAGE> 3
9. The corporation reserves the right to amend, alter, change or
repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
WE, THE UNDERSIGNED, being each of the incorporators hereinbefore
named, for the purpose of forming a corporation pursuant to the General
Corporation Law of the State of Delaware, do make this certificate, hereby
declaring and certifying that this is our act and deed and the facts herein
stated are true, and accordingly have hereunto set our hands this 7th day of
August, 1986.
/s/ D. A. Hampton
---------------------------------------
D. A. Hampton
/s/ J. A. Grodzicki
---------------------------------------
J. A. Grodzicki
/s/ S. J. Queppet
---------------------------------------
S. J. Queppet
-3-
<PAGE> 4
CERTIFICATE OF CHANGE OF LOCATION OF REGISTERED OFFICE
AND OF REGISTERED AGENT
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"corporation") is
CURREY BROADCASTING CORPORATION
2. The registered office of the corporation within the State of
Delaware is hereby changed to 32 Loockerman Square, Suite L-100, City of Dover
19901, County of Kent.
3. The registered agent of the corporation within the State of
Delaware is hereby changed to The Prentice-Hall Corporation System, Inc., the
business office of which is identical with the registered office of the
corporation as hereby changed.
4. The corporation has authorized the changes hereinbefore set
forth by resolution of its Board of Directors.
SIGNED on July 1, 1993.
/s/ Frank D. Osborn
---------------------------------------
Frank D. Osborn, President
Attest:
/s/ Heather S. McDonnell
- ------------------------------------
Heather S. McDonnell, Secretary
<PAGE> 1
EXHIBIT 3.16
CERTIFICATE OF INCORPORATION
of
DAYTONA BEACH BROADCASTING CORP.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is Daytona Beach
Broadcasting Corp. (the "Corporation").
2. Address; Registered Office and Agent. The address of the
Corporation's registered office is 32 Loockerman Square, Suite L-100, City of
Dover, County of Kent, State of Delaware; and its registered agent at such
address is The Prentice-Hall Corporation System, Inc.
3. Purposes. The purpose of the Corporation is to engage in,
carry on and conduct any lawful act or activity for which corporations may be
organized under the Delaware General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and address of Incorporator. The name and mailing
address of the incorporator are: Heather S. McDonnell, Osborn Communications
Corporation, 405 Lexington Avenue, 54th Floor, New York, NY 10174.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Limitation of Liability. No Director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a Director,
<PAGE> 2
except for liability (a) for any breach of the Director's duty of loyalty to
the Corporation or its stockholders, (b) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(c) under Section 174 of the Delaware General Corporation Law or (d) for any
transaction from which the Director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a Director of the Corporation existing at the time of such repeal
or modification.
8. Indemnification.
8.1 To the extent not prohibited by law, the Corporation
shall indemnify any person who is or was made, or threatened to be made, a
party to any threatened, pending or completed action, suit or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative,
including, without limitation, an action by or in the right of the Corporation
to procure a judgment in its favor, by reason of the fact that such person, or
a person of whom such person is the legal representative, is or was a Director
or officer of the Corporation, or is or was serving in any capacity at the
request of the Corporation for any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise (an "Other Entity"),
against judgments, fines, penalties, excise taxes, amounts paid in settlement
and costs, charges and expenses (including attorneys' fees and disbursements).
Persons who are not Directors or officers of the Corporation may be similarly
indemnified in respect of service to the Corporation or to an Other Entity at
the request of the Corporation to the extent the Board at any time specifies
that such persons are entitled to the benefits of this Section 8.
8.2 The Corporation shall, from time to time, reimburse or advance
to any Director or officer or other person entitled to indemnification
hereunder the funds necessary for payment of
-2-
<PAGE> 3
expenses, including attorneys' fees and disbursements, incurred in connection
with any Proceeding, in advance of the final disposition of such Proceeding;
provided, however, that, if required by the Delaware General Corporation Law,
such expenses incurred by or on behalf of any Director or officer or other
person may be paid in advance of the final disposition of a Proceeding only
upon receipt by the Corporation of an undertaking, by or on behalf of such
Director of officer (or other person indemnified hereunder), to repay any such
amount so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right of appeal that such Director,
officer or other person is not entitled to be indemnified for such expenses.
8.3 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or reimbursement or advancement of expenses may have or hereafter be entitled
under any statute, this Certificate of Incorporation, the By-laws of the
Corporation (the "By-laws"), any agreement, any vote of stockholders or
disinterested Director or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
8.4 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall continue
as to a person who has ceased to be a Director or officer (or other person
indemnified hereunder) and shall inure to the benefit of the executors,
administrators, legatees and distributees of such person.
8.5 The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a Director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of an Other Entity,
against any liability asserted against such person and incurred by such person
in any such capacity,
-3-
<PAGE> 4
or arising out of such person's status as such, whether or not the Corporation
would have the power to indemnify such person against such liability under the
provisions of this Section 8, the By-laws or under Section 145 of the Delaware
General Corporation Law or any other provision of law.
8.6 The provisions of this Section 8 shall be a contract between
the Corporation, on the one hand, and each Director and officer who serves in
such capacity at any time while this Section 8 is in effect and any other
person indemnified hereunder, on the other hand, pursuant to which the
Corporation and each such Director, officer, or other person intend to be
legally bound. No repeal or modification of this Section 8 shall affect any
rights or obligations with respect to any state of facts then or theretofore
existing or thereafter arising or any proceeding theretofore or thereafter
brought or threatened based in whole or in part upon any such state of facts.
8.7 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall be
enforceable by any person entitled to such indemnification or reimbursement or
advancement of expenses in any court of competent jurisdiction. The burden of
proving that such indemnification or reimbursement or advancement of expenses
is not appropriate shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) to have made a determination prior to the commencement of
such action that such indemnification or reimbursement or advancement of
expenses is proper in the circumstances nor an actual determination by the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) that such person is not entitled to such indemnification
or reimbursement or advancement of expenses shall constitute a defense to the
action or create a presumption that such person is not so entitled. Such a
person shall also be indemnified for any expenses incurred in
-4-
<PAGE> 5
connection with successfully establishing his or her right to such
indemnification or reimbursement or advancement of expenses, in whole or in
part, in any such proceeding.
8.8 Any Director or officer of the Corporation serving in any
capacity (a) another corporation of which a majority of the shares entitled to
vote in the election of its directors is held, directly or indirectly, by the
Corporation or (b) any employee benefit plan of the Corporation or any
corporation referred to in clause (a) shall be deemed to be doing so at the
request of the Corporation.
8.9 Any person entitled to be indemnified or to reimbursement or
advancement of expenses as a matter of right pursuant to this Section 8 may
elect to have the right to indemnification or reimbursement or advancement of
expenses interpreted on the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advance of
expenses is sought. Such election shall be made, by a notice in writing to the
Corporation, at the time indemnification or reimbursement or advancement of
expenses is sought; provided, however, that if no such notice is given, the
right to indemnification or reimbursement or advancement of expenses shall be
determined by the law in effect at the time indemnification or reimbursement of
advancement of expenses is sought.
9. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original By-laws) make, alter or repeal the By-laws by a vote of two-thirds of
the entire Board of Directors that would be in office if no vacancy existed,
whether or not present at a meeting; provided, however, that any By-laws made,
amended or repealed by the Board of Directors may be amended or repealed, and
any By-laws may be made, by the stockholders of the Corporation by a vote of a
majority of the holders of shares of stock of the Corporation entitled to vote
in the election of Directors of the Corporation.
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<PAGE> 6
WITNESS the signature of this Certificate this 22nd of October, 1993.
/s/ Heather S. McDonnell
---------------------------------------
Heather S. McDonnell
Incorporator
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<PAGE> 1
EXHIBIT 3.17
ARTICLES OF INCORPORATION
OF
GREAT AMERICAN EAST, INC.
I, the undersigned natural person of the age of eighteen years or
more, do hereby associate myself into a business corporation under the laws of
the State of North Carolina as contained in Chapter 55 of the General Statutes
of North Carolina, entitled "Business Corporation Act", and the several
amendments thereto and hereby make, sign and acknowledge these Articles of
Incorporation setting forth the following:
1. The name of the corporation is Great American East, Inc.
2. The period of duration of the corporation shall be perpetual.
3. The purpose or purposes for which the corporation is organized
are:
(a) To construct, acquire, own, operate, maintain and
sell radio broadcasting stations, television broadcasting stations,
CATV systems, background music services, telephone answering services,
common carrier radio stations, advertising agencies, and to sell
advertising, perform all acts, directly or indirectly, and conduct all
business in connection with, relating to or arising from the ownership
or operation of the aforesaid business or businesses; and
(b) To engage in any lawful act or activity for which
corporations may be organized under Chapter 55 of the General Statutes
of North Carolina; and
(c) To conduct its business and exercise all of its
purposes in the State of North Carolina, in other states of the United
States of America, in the District of Columbia and the territories,
colonies and possessions of the United States of America and in
foreign countries,
<PAGE> 2
as principal, agent, contractor or otherwise, either alone or in
conjunction with any entity or entities; and either directly or
indirectly through one or more subsidiaries or controlled entities
organized or utilized for these purposes; and
(d) To carry out all or any part of the foregoing
objects, purposes or powers and participate or deal with or in any
lawful enterprise in connection therewith or incidental thereto, to
the fullest extent lawfully permitted of any corporation organized
under the laws of the State of North Carolina, and to a like extent,
in connection therewith, to make, enter into and perform such
contracts or deeds, to do such acts and things and to exercise such
powers as a natural person could lawfully make, enter into, do or
exercise; and
(e) To do all and everything necessary, suitable, proper
or convenient for the accomplishment of any of the purposes or the
attainment of any of the objects or the furtherance of any of the
powers or purposes herein enumerated or otherwise granted or permitted
by law and by North Carolina General Statutes Section 55-17, either
alone or in association with other corporations, firms, associations
or individuals, and to do every other act or acts, thing or things
incidental or appurtenant to or growing out of or connected with the
aforesaid objects, purposes or powers, or any part or parts thereof,
provided the same be not inconsistent with the laws under which this
corporation is organized; and
(f) Each and every clause, phrase or term of the
foregoing provisions shall be considered as expressing both an
independent purpose and power of the corporation and shall not (except
as otherwise specifically stated) be limited or restricted by
reference to or inference from the clauses, phrases or terms of any
other provision herein contained, and the specification of particular
purposes and powers herein is not intended to be and shall not be
held to be in limitation of the general purposes and powers herein set
forth, or in limitation
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<PAGE> 3
of the powers granted to corporations under
the laws of the State of North Carolina, but is intended to be and
shall be held to be in furtherance thereof.
4. The aggregate number of shares of common capital stock which
the corporation shall have authority to issue is 100,000 shares with a par
value of one dollar ($1.00) per share.
5. The minimum amount of consideration for its shares to be
received by the corporation before it shall commence business is $100.00 in
cash or in property or consideration of equivalent value.
6. The address of the initial registered office of the
corporation in the State of North Carolina is in Wake County, 209 Fayetteville
Street Mall, Raleigh, North Carolina 27601, and the name of the initial
registered agent at such address is Mark J. Prak.
7. The number of directors of the corporation may be fixed by the
By-Laws but shall not be less than one.
The number of directors constituting the initial Board of Directors
shall be one (1) and the name and address of the person who is to serve as the
director until the first meeting of the shareholders or until her successor is
elected and qualify, is:
Kathy Shearer
Route 2, 421 NRF Road
Youngsville, North Carolina 27596
8. The name and address of the incorporator is:
Mark J. Prak
6201 Coldwater Court
Raleigh, N.C. 27612
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<PAGE> 4
IN TESTIMONY WHEREOF, I hereunto set my hand this 28th day of
September, 1987.
/s/ Mark J. Prak
---------------------------------------
Mark J. Prak
NORTH CAROLINA
WAKE COUNTY
I, /s/ Jenny D. Lockamy, a Notary Public in and for said County and
State, do hereby certify that Mark J. Prak personally appeared before me this
day and acknowledged the due execution of the foregoing instrument.
Witness my hand and official seal this 28th day of September, 1987.
/s/ Jenny D. Lockamy
---------------------------------------
Notary Public
My Commission expires:
12-1-91 .
- ----------------------------------
(SEAL)
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<PAGE> 1
EXHIBIT 3.18
CERTIFICATE OF INCORPORATION
of
HOUNDSTOOTH BROADCASTING CORPORATION
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware (the "General Corporation
Law"), certifies as follows:
1. Name. The name of the corporation is Houndstooth Broadcasting
Corporation (the "Corporation").
2. Address; Registered Office and Agent. The address of the
corporation's registered office is 1013 Centre Road, City of Wilmington, County
of New Castle, State of Delaware 19805; and its registered agent at such
address is The Prentice-Hall Corporation System, Inc.
3. Purposes. The purpose of the Corporation is to engage in any
lawful act or activity for which corporations may be organized under the
General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($0.01)
each.
5. Name and Mailing Address of Incorporator. The name and
mailing address of the incorporator are: Scott Grader, 1285 Avenue of the
Americas, New York, Now York 10019-6064.
<PAGE> 2
6. Election of Directors. Members of the Board of Directors of
the Corporation (the "Board") may be elected either by written ballot or by
voice vote.
7. Limitation of Liability. No director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, provided that this
provision shall not eliminate or limit the liability of a director (a) for any
breach of the director's duty of loyalty to the Corporation or its
stockholders, (b) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (c) under section 174 of
the General Corporation Law or (d) for any transaction from which the director
derived any improper personal benefits.
Any repeal or modification of the foregoing provision shall not
adversely affect any right or protection of a director of the Corporation
existing at the time of such repeal or modification.
8. Indemnification.
8.1 To the extent not prohibited by law, the Corporation
shall indemnify any person who is or was made, or threatened to be made, a
party to any threatened, pending or completed action, suit or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative,
including, without limitation, an action by or in the right of the Corporation
to procure a judgment in its favor, by reason of the fact that such person, or
a person of whom such person is the legal representative, is or was a director
or officer of the Corporation, or, at the request of the Corporation, is or was
serving as a director or officer of any other corporation or in a capacity with
comparable authority or responsibilities for any partnership, joint venture,
trust, employee benefit plan or other enterprise (an "Other Entity"), against
judgments, fines, penalties, excise taxes,
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<PAGE> 3
amounts paid in settlement and costs, charges and expenses (including
attorneys' fees, disbursements and other charges). Persons who are not
directors or officers of the Corporation (or otherwise entitled to
indemnification pursuant to the preceding sentence) may be similarly
indemnified in respect of service to the Corporation or to an Other Entity at
the request of the Corporation to the extent the Board at any time specifies
that such persons are entitled to the benefits of this Section 8.
8.2 The Corporation shall, from time to time, reimburse or advance
to any director or officer or other person entitled to indemnification
hereunder the funds necessary for payment of expenses, including attorneys fees
and disbursements, incurred in connection with any Proceeding, in advance of
the final disposition of such Proceeding; provided, however, that, if required
by the General Corporation Law, such expenses incurred by or on behalf of any
director or officer or other person may be paid in advance of the final
disposition of a Proceeding only upon receipt by the Corporation of an
undertaking, by or on behalf of such director or officer (or other person
indemnified hereunder), to repay any such amount so advanced if it shall
ultimately be determined by final judicial decision from which there is no
further right of appeal that such director, officer or other person is not
entitled to be indemnified for such expenses.
8.3 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or reimbursement or advancement of expenses may have or hereafter be entitled
under any statute, this Certificate of Incorporation, the By-laws of the
Corporation (the "By-laws"), any agreement, any vote of stockholders or
disinterested directors or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
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<PAGE> 4
8.4 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall continue
as to a person who has ceased to be a director or officer (or other person
indemnified hereunder) and shall inure to the benefit of the executors,
administrators, legatees and distributors of such person.
8.5 The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of an Other Entity,
against any liability asserted against such person and incurred by such person
in any such capacity, or arising out of such person's status as such, whether
or not the Corporation would have the power to indemnify such person against
such liability under the provisions of this Section 8, the By-laws or under
section 145 of the General Corporation Law or any other provision of law.
8.6 The provisions of this Section 8 shall be a contract between
the Corporation, on the one hand, and each director and officer who serves in
such capacity at any time while this Section 8 is in effect and any other
person entitled to indemnification hereunder, on the other hand, pursuant to
which the Corporation and each such director, officer, or other person intend
to be, and shall be, legally bound. No repeal or modification of this Section
8 shall affect any rights or obligations with respect to any state of facts
then or theretofore existing or thereafter arising or any proceeding
theretofore or thereafter brought or threatened based in whole or in part upon
any such state of facts.
8.7 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall be
enforceable by any person entitled to such indemnification or reimbursement or
advancement of expenses in any court of competent jurisdiction. The burden of
proving that such indemnification or reimbursement or advancement of expenses
is not appropriate shall be on the Corporation. Neither the failure of the
Corporation (including its Board, its independent legal counsel and its
stockholders) to have made a determination prior to the commencement of such
action that such indemnification or reimbursement or advancement of expenses is
proper in the circumstances nor an actual determination by the Corporation
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<PAGE> 5
(including its Board, its independent legal counsel and its stockholders) that
such person is not entitled to such indemnification or reimbursement or
advancement of expenses shall constitute a defense to the action or create a
presumption that such person is not so entitled. Such a person shall also be
indemnified for any expenses incurred in connection with successfully
establishing his or her right to such indemnification or reimbursement or
advancement of expenses, in whole or in part, in any such proceeding.
8.8 Any director or officer of the Corporation serving in any
capacity (a) another corporation of which a majority of the shares entitled to
vote in the election of its directors is held, directly or indirectly, by the
Corporation or (b) any employee benefit plan of the Corporation or any
corporation referred to in clause (a) shall be deemed to be doing so at the
request of the Corporation.
8.9 Any person entitled to be indemnified or to reimbursement or
advancement of expenses as a matter of right pursuant to this Section 8 may
elect to have the right to indemnification or reimbursement or advancement of
expenses interpreted an the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advancement
of expenses is sought. Such election shall be made, by a notice in writing to
the Corporation, at the time indemnification or reimbursement or advancement of
expenses is sought; provided, however, that if no such notice is given, the
right to indemnification or reimbursement or advancement of expenses shall be
determined by the law in effect at the time indemnification or reimbursement
or advancement of expenses is sought.
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<PAGE> 6
9. Adoption, Amendment and/or Repeal of By-Laws. The Board may
from time to time adopt, amend or repeal the By-laws of the Corporation;
provided, however, that any By-laws adopted or amended by the Board may be
amended or repealed, and any By-laws may be adopted, by the stockholders of the
Corporation by vote of a majority of the holders of shares of stock of the
Corporation entitled to vote in the election of directors of the Corporation.
10. Action by Stockholders. Notwithstanding the provisions of
section 228 of the General Corporation Law (or any successor statute), any
action required or permitted by the General Corporation Law to be taken at any
annual or special meeting of stockholders of the Corporation may be taken only
at such an annual or special meeting of stockholders and cannot be taken by
written consent without a meeting.
WITNESS the signature of this Certificate this of November 5, 1996.
/s/ Scott Grader
---------------------------------------
Scott Grader, Incorporator
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<PAGE> 1
EXHIBIT 3.19
CERTIFICATE OF INCORPORATION
of
JAMBOREE IN THE HILLS, INC.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follows:
1. Name. The name of the corporation is Jamboree In The Hills,
Inc.
2. Address; Registered Agent. The address of the Corporation's
registered office is 32 Loockerman Square, Suite L-100, City of Dover 19901,
County of Kent, State of Delaware; and its registered agent at such address is
The Prentice-Hall Corporation System, Inc.
3. Purposes. The nature of the business and purposes to be
conducted or promoted by the Corporation are to engage in, carry on and conduct
any lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
4. Number of Shares. The total number of shares of stock which
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are: Heather L. Short, Osborn Communications
Corporation, 405 Lexington Avenue 54th Floor, New York, N.Y. 10174.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original by-laws of the Corporation) make,
<PAGE> 2
alter or repeal the by-laws of the Corporation; provided, that any by-laws
made, amended or repealed by the Board of Directors may be amended or repealed,
and any by-laws may be made, by the stockholders of the Corporation.
IN WITNESS WHEREOF, this Certificate has been signed on this 11th day
of March, 1991.
/s/ Heather L. Short
---------------------------------------
Heather L. Short, Incorporator
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<PAGE> 1
EXHIBIT 3.20
CERTIFICATE OF INCORPORATION
OF
LADNER COMMUNICATIONS HOLDING CORP.
The undersigned Delaware corporation, for the purpose of organizing a
corporation under and pursuant to the provisions of the General Corporation Law
of the State of Delaware, hereby certifies as follows:
ARTICLE 1
NAME
The name of the Company is Ladner Communications Holding Corp.
ARTICLE 2
REGISTERED OFFICE
The address of the registered office of the Company shall be 229 South
State Street, Dover, Kent County, Delaware. The name of the registered agent
is United States Corporation Company.
ARTICLE 3
PURPOSES
The purpose of Company is to engage in any lawful act or activity for
which a corporation may be organized under the General Corporation Law of
Delaware.
Without limiting in any manner the scope and generality of the
foregoing, it is hereby provided that the Company shall have the following
purposes, objects and powers:
To develop, acquire, own and operate radio, television or other
broadcast properties and to engage in all activities deemed by the Company to
be necessary, advisable and attendant thereto.
ARTICLE 4
STOCK
The total number of shares of all classes of stock which the Company
shall have authority to issue is 100,000 shares, all of which shares shall be
Common Stock (the "Common Stock"), par value $.01 per share.
Except as otherwise stated in this Certificate of Incorporation, or as
otherwise required by law, (i) each share of Common Stock of the Company shall
be equal in all respects to each other share of Common Stock and (ii) the
holders of shares of Common Stock shall be entitled to one vote for each share
of Common Stock held with respect to all matters as to which the Common Stock
is entitled to be voted.
<PAGE> 2
The holders of the Common Stock shall be entitled to receive such
dividends (payable in cash, stock, or otherwise) as may be declared on the
Common Stock by the Board of Directors at any time or from time to time out of
any funds legally available therefor.
No shareholder shall be entitled to pre-emptive rights with respect to
any shares of capital stock issued by the Company.
Undesignated Common Stock
The Company shall have 90,000 shares of undesignated Common Stock.
Non-voting Common Stock
The remaining 10,000 shares of authorized Common Stock shall be
designated Non-voting Common Stock and shall not be entitled to vote upon any
matter.
1. Dividends and Distributions. The shares of Non-voting Common
Stock shall be entitled to receive dividends on a parity with the Company's
undesignated Common Stock, if and when dividends are declared and paid with
respect to the Common Stock. Upon any liquidation, dissolution, or winding up
of the Company, whether voluntary or involuntary, the holders of Non-voting
Common Stock shall be entitled to share in distributions on a pro rata basis
with the holders of the undesignated Common Stock.
2. Optional Conversion. Each share of Non-voting Common Stock
may be converted into one share of undesignated Common Stock at any time, so
long as it does not result in BancBoston Capital Inc., a Massachusetts
corporation, together with its affiliates, being deemed the beneficial owner of
greater than 4.9% of the outstanding shares of all classes or series of Common
Stock entitled to vote. The holder of Non-voting Common Stock shall notify the
Company of its intention to convert such stock in writing, mailed or delivered
to the principal office of the Company, setting forth the number of shares to
be converted and such shares shall be deemed converted upon receipt by the
Company of such notice.
3. Automatic Conversion. Each share of Non-voting Common Stock,
automatically and without further action by the holder or the Company will be
converted into one share of undesignated Common Stock, upon its transfer to a
beneficial owner other than BancBoston Capital Inc. or an affiliate of
BancBoston Capital Inc.
4. Anti-dilution Adjustments.
(A) Effect of "Split-ups" and "Split-downs" and Certain
Dividends. In case at any time or from time to time the Company shall subdivide
as a whole, by reclassification, by the issuance of a stock dividend on the
undesignated Common Stock payable in Common Stock, or otherwise, the number of
shares of undesignated Common Stock then outstanding into a greater number of
shares of undesignated Common Stock, with or without par value, the number of
shares of undesignated Common Stock into which the Non-voting Common Stock may
be converted,
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<PAGE> 3
together with any outstanding shares of Non-voting Common Stock, shall be
increased proportionately. In case at any time or from time to time the
Company shall consolidate as a whole, by reclassification or otherwise, the
number of shares of undesignated Common Stock then outstanding into a lesser
number of shares of undesignated Common Stock, with or without par value, the
number of shares of undesignated Common Stock into which the Non-voting Common
Stock may be converted hereunder, together with any outstanding shares of
Non-voting Common Stock, shall be reduced proportionately.
(B) Effect of Merger or Consolidation. In case the
Company shall, while any Non-voting Common Stock remains outstanding, enter
into any consolidation with or merge into any other corporation wherein the
Company is not the surviving corporation, or sell or convey its property as an
entirety or substantially as an entirety, and in connection with such
consolidation, merger, sale or conveyance, shares of stock or other securities
shall be issuable or deliverable in exchange for the Common Stock of the
Company, the Non-voting Common Stock shall thereafter be entitled to receive
the number of the shares of stock, other securities or other consideration to
which the number of shares of undesignated Common Stock obtainable upon
conversion of his Non-voting Common Stock would have been entitled at the time
of such consolidation, merger, sale or conveyance (in lieu of the number of
shares of undesignated Common Stock into which such holder would have been
entitled to convert his shares of Non-voting Common Stock immediately prior to
such consolidation, merger, sale or conveyance). In case of any such
consolidation, merger, sale or conveyance, appropriate provision (as determined
by a resolution of the Board of Directors of the Company) shall be made with
respect to the rights and interests thereafter of the holders of the Non-Voting
Common Stock, to the end that all the provisions of this Restated Certificate
of Incorporation (including adjustment provisions) shall thereafter be
applicable, as nearly as reasonably practicable, in relation to such stock or
other securities.
(C) Reorganization and Reclassification. In case of any
capital reorganization or any reclassification of the capital stock of the
Company (except as provided above in Paragraphs 4(A) and (B)), while Non-
voting Common Stock remains outstanding, a holder of Non-voting Common Stock
shall thereafter be entitled to receive the number of shares of stock of any
class or classes or other securities property to which the number of
undesignated Common Stock obtainable upon conversion of his Non-voting Common
Stock would have been entitled at the time of such reorganization or
reclassification (in lieu of the number of shares of Common Stock into which
such holder would have been entitled to convert his shares of Non-voting Common
Stock immediately prior to such reorganization or reclassification). In case
of any such capital reorganization or reclassification, appropriate provision
(as determined by resolution of the Board of Directors of the Company) shall be
made with respect to the rights and interests thereafter of the holders of the
Non-voting Common Stock, to the end that all the provisions of this Restated
Certificate of Incorporation (including adjustment provisions) shall thereafter
be applicable, as nearly as reasonably practicable, in relation to such stock
or other securities or property.
(D) Determination by the Board of Directors. All
determinations by the Board of Directors of the Company under the provisions of
this Section 4 shall be made in good faith with due regard to the interests of
the holders of the Non-voting Common Stock and in accordance with good
financial practice, and all valuations made by the Board of Directors of the
Company under the
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<PAGE> 4
terms of this Section 4 must be made with due regard to any market quotations
of securities involved in, or related to, the subject of such valuation.
(E) Reservation of Common Stock. The Company will at all
times reserve and keep available out of its authorized Common Stock or its
treasury shares, solely for the purpose of issuance upon the conversion of
Non-voting Common Stock as herein provided, such number of shares of
undesignated Common Stock as shall then be issuable upon the conversion of all
authorized shares of Non-voting Common Stock. The Company will not take any
action which would require an adjustment under this Section 4, if after such
action, the total number of shares of undesignated Common Stock issued and
issuable upon conversion of the Non-voting Common Stock would exceed the total
number of shares of undesignated Common Stock then authorized by this Restated
Certificate of Incorporation.
ARTICLE 5
INCORPORATOR
The name and mailing address of the incorporator are as follows:
Name Mailing Address
Osborn Communications Corporation 757 Third Avenue, Suite 1806
New York, New York 10017
ARTICLE 6
MANAGEMENT
The following provisions are inserted for the management of the
business and for the conduct of the affairs of the Company, and for further
definition, limitation and regulation of the powers of the Company and of its
directors and shareholders:
(1) The number of directors of the Company shall be such
as from time to time shall be fixed by, or in the manner provided in, the
By-Laws. Election of directors need not be by ballot unless the By-Laws so
provide.
(2) The Board of Directors shall have power to make,
alter, amend, change, add to or repeal the By-Laws of the Company; to fix and
vary the amount of Common Stock to be reserved for any proper purpose; to
authorize and cause to be executed mortgages and liens upon all or any part of
the property of the Company; to determine the use and disposition of any
surplus or net profits; and to fix the times for the declaration and payment of
dividends.
(3) The directors in their discretion may submit any
contract or act for approval or ratification at any annual meeting of the
shareholders or at any meeting of the shareholders called for the purpose of
considering any such act or contract, and any contract or act that shall be
approved or be ratified by the vote of the holders of a majority of the stock
of the Company which is represented in person or by proxy at such meeting and
entitled to vote thereat (provided that a lawful
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<PAGE> 5
quorum of shareholders be there represented in person or by proxy) shall be as
valid and as binding upon the Company and upon all the shareholders as though
it had been approved or ratified by every shareholder of the Company, whether
or not the contract or act would otherwise be open to legal attack because of
directors' interest, or for any other reason.
(4) In addition to the powers and authorities
hereinbefore or by statute expressly conferred upon them, the directors are
hereby empowered to exercise all such powers and do all such acts and things as
may be exercised or done by the Company, subject, nevertheless, to the
provisions of the statutes of Delaware, of this Certificate, and to any By-Laws
from time to time; provided, however, that no By-Laws so made shall invalidate
any prior act of the directors which would have been valid if such By-Law had
not been made.
ARTICLE 7
INDEMNIFICATION
The Company shall indemnify, and upon request shall advance expenses
to, in the manner and to the full extent permitted by law, any person (or the
estate of any person) who was or is a party to, or is threatened to be made a
party to, any threatened, pending or complete action, suit or proceeding,
whether or not by or in the right of the Company, and whether civil, criminal,
administrative, investigative or otherwise, by reason of the fact that such
person is or was a director, officer, or employee of the Company, or is or was
serving at the request of the Company as a director, officer, partner, trustee
or employee of another corporation, partnership, joint venture, trust or other
enterprise. The Company may, to the full extent permitted by law, purchase and
maintain insurance on behalf of any such person against any liability which may
be asserted against him or her. To the full extent permitted by law, the
indemnification and advances provided for herein shall include expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement.
The indemnification provided herein shall not be deemed to limit the right of
the Company to indemnify any other person for any such expenses to the full
extent permitted by law, nor shall it be deemed exclusive of any other rights
to which any person seeking indemnification from the Company may be entitled
under any agreement, vote of shareholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office.
A director shall not be personally liable to the Company or its
shareholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to
the Company or its shareholders, (ii) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law, (iii)
under Section 174 of the Delaware General Corporation Act, or (iv) for any
transaction from which the Director derived an improper personal benefit. If
the Delaware General Corporation Act is amended after approval by the
shareholders of this Section to authorize corporate action further eliminating
or limiting the personal liability of directors, then the liability of a
director of the Company shall be eliminated or limited to the fullest extent
permitted by the Delaware General Corporation Act, as so amended. Any repeal or
modification of the foregoing portion of this Section by the shareholders shall
not adversely affect any right or protection of a director of the Company
existing at the time of such repeal or modification.
-5-
<PAGE> 6
ARTICLE 8
COMMUNICATIONS ACT REQUIREMENTS
In accordance with the Federal Communications Act of 1934, as amended
(the "Communications Act"), and regulations of the Federal Communications
Commission (the "FCC Regulations"), the Board of Directors of the Company may:
(a) prohibit the ownership or voting of more than 20% of the Company's
outstanding capital stock by or for the account of aliens or their
representatives or by a foreign government or representative thereof or by any
corporation organized under the laws of a foreign country (collectively
"Aliens"), or by or for corporations of which any officer is an Alien, more
than one-fourth of its directors are Aliens, or of which more than one-fourth
of its capital stock is owned of record or voted by Aliens; (b) prohibit any
transfer of the Company's capital stock which would cause more than 20% of the
Company's outstanding capital stock to be owned or voted by or for any person
or entity designated in foregoing clause (a); and (c) prohibit the ownership,
voting or transfer of any portion of its outstanding capital stock to the
extent the ownership, voting or transfer of such portion would cause the
Company to violate or otherwise result in violation of any provision of the
Communications Act or the FCC Regulations.
ARTICLE 9
COMPROMISE OR ARRANGEMENT
OR REORGANIZATION
Whenever a compromise or arrangement is proposed between this Company
and its creditors or any class of them and/or between this Company and its
shareholders or any clan of them, any court of equitable jurisdiction within
the State of Delaware may, on the application in a summary way of this Company
or of any creditor or shareholder thereof or on the application of any receiver
or receivers appointed for this Company under the provisions of Section 291 of
Title 8 of the Delaware Code or on the application of trustees in dissolution
or of any receiver or receivers appointed for this Company under the provisions
of Section 279 of Title 8 of the Delaware Code, order a meeting of the
creditors or class of creditors, and/or of the shareholders or class of
shareholders of this Company, as the case may be, to be summoned in such manner
as the said court directs. If a majority in number representing three-fourths
in value of the creditors or class of creditors, and/or of the shareholders or
class of shareholders of this Company, as the case may be, agree to any
compromise or arrangement and to any reorganization of this Company as a
consequence of such compromise or arrangement, the said compromise or
arrangement and the said reorganization shall, if sanctioned by the court to
which the said application has been made, be binding on all the creditors or
class of creditors, and/or on all the shareholders or class of shareholders, of
this Company, as the case may be, and also on this Company.
ARTICLE 10
UNCLAIMED DIVIDENDS
Any and all right, title, interest and claim in or to any dividends
declared by the Company, whether in cash, stock, or otherwise, which are
unclaimed by the shareholder entitled thereto for a period of six years after
the close of business on the payment date, shall be deemed to be extinguished
and abandoned; any such unclaimed dividends in the possession of the Company,
its
-6-
<PAGE> 7
transfer agents, or other agents or depositories, shall at such time become the
absolute property of the Company, free and clear of any and all claims of any
persons whatsoever.
ARTICLE 11
AMENDMENT
The Company reserves the right to amend, alter, change or repeal any
provision contained in this Certificate of Incorporation in the manner now or
hereafter prescribed by law, and all rights and powers conferred herein on
shareholders, directors and officers are subject to this reserved power.
IN WITNESS WHEREOF, the undersigned corporation, acting as
Incorporator, has caused this Certificate of Incorporation to be signed this
4th day of May, 1987.
OSBORN COMMUNICATIONS CORPORATION
Incorporator
Attest:
/s/ Josephine N. Osborn By:/s/ Frank D. Osborn
- ---------------------------------- ---------------------------------------
Secretary Frank D. Osborn
President
-7-
<PAGE> 1
EXHIBIT 3.21
CERTIFICATE OF INCORPORATION
OF
MOUNTAIN BROADCASTING CORPORATION
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follows:
1. Name. The name of the corporation is MOUNTAIN BROADCASTING
CORPORATION (hereinafter called the "Corporation").
2. Address; Registered Agent. The address of the Corporation's
registered office is 229 South State Street, City of Dover, County of Kent,
State of Delaware; and its registered agent at such address is United States
Corporation Company.
3. Purposes. The nature of the business and purposes to be
conducted or promoted by the Corporation are to engage in, carry on and conduct
any lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
4. Number of Shares. The total number of shares of stock which
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($0.01)
each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are:
Laurence W. Bates c/o Paul,
Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, New York 10019
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
<PAGE> 2
7. Limitation of Liability. No director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, except for liability (i)
for any breach of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the Delaware General Corporation Law, or (iv) for any transaction from which
the director derived any improper personal benefit.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a director of the Corporation existing at the time of such repeal
or modification.
8. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original by-laws of the Corporation) make, alter or repeal the by-laws of the
Corporation; provided, that any by-laws made, amended or repealed by the Board
of Directors may be amended or repealed, and any by-laws may be made, by the
stockholders of the Corporation.
IN WITNESS WHEREOF, this Certificate has been signed on this 8th day
of April, 1987.
/s/ Laurence W. Bates
---------------------------------------
Laurence W. Bates, Incorporator
-2-
<PAGE> 3
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
MOUNTAIN BROADCASTING CORPORATION
Pursuant to Section 242 of the General
Corporation Law of the State of Delaware
I, the undersigned, being the President and Treasurer of
MOUNTAIN BROADCASTING CORPORATION, a Delaware corporation, do hereby certify:
FIRST: That Article One of the Certificate of Incorporation
is amended to read as follows:
1. Name. The name of the corporation is MOUNTAIN RADIO
CORPORATION (hereinafter called the "Corporation").
SECOND: That such amendment has been duly adopted in
accordance with the provisions of Section 242 of the General Corporation Law of
the State of Delaware, and has been duly approved by the sole shareholder of
the Corporation.
IN WITNESS WHEREOF, I have hereunto set my hand the day of
May, 1987.
/s/ Frank D. Osborn
---------------------------------------
Frank D. Osborn
President and Treasurer
<PAGE> 4
I, Josephine N. Osborn, do hereby certify that I am the Secretary of
the Corporation and as such am authorized to execute and deliver this
certificate on behalf of the Corporation, and do further certify that the above
signature of Frank D. Osborn is his genuine signature and that he is on the
date of this certificate, and has been since April 24, 1987, the duly elected,
qualified and acting President and Treasurer of the Corporation.
IN WITNESS WHEREOF, I have executed this certificate this 26th day of
May, 1987.
/s/ Josephine N. Osborn
---------------------------------------
Josephine N. Osborn
Secretary
-2-
<PAGE> 1
EXHIBIT 3.22
WEST VIRGINIA
ARTICLES OF INCORPORATION
OF
MUSIC HALL CLUB, INC.
The undersigned, acting as incorporator(s) of a corporation under
Chapter 32, Article I, Section 2.7 of the West Virginia Code, adopt(s) the
following Articles of Incorporation for such corporation:
1. The undersigned agree to become a West Virginia corporation by
the name of MUSIC HALL CLUB, INC.
2. A. The address at the physical location of the principal
office of the corporation will be 1015 main Street, in the city, town or
village of Wheeling, county of Ohio, State of West Virginia, 26003.
3. This corporation is organized as:
Stock, for profit, and the aggregate value of the authorized
capital stock of said profit corporation will be five thousand dollars, which
shall be divided into fifty shares of the par value of one hundred dollars
each. (If the shares are to be divided into more than one class or if the
corporation is to issue shares in any preferred or special class in series,
additional statements are required within the articles of incorporation.)
4. The period of duration of the corporation, which may be
perpetual is perpetual.
<PAGE> 2
5. The purpose(s) for which this corporation is formed, which may
be stated to be or to include, the transaction of any or all lawful business
for which corporations may be incorporated in West Virginia, is (are) as
follows:
The transaction of any and all lawful business for which a
corporation may be incorporated in West Virginia.
6. The provisions for the regulation of the internal affairs of
the corporation, which the incorporators elect to set forth in the articles of
incorporation, are as follows:
None.
7. The provisions granting, limiting or denying preemptive rights
to shareholders, if any, are as follows:
None.
8. The full name(s) and address(es) of the incorporator(s),
including street and street numbers, if any, and the city, town or village,
including the zip code, and the number of shares subscribed for by each is(are)
as follows:
Number of Shares
Name Address Options
Larry Anderson 176 Oakmont Road, Whg, WV 26003
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
9. The number of directors constituting the initial board of
directors of the corporation is 3 and the names and addresses of the persons
who are to serve as directors until the first annual meeting of
shareholders/members, or until their successors are elected and shall qualify,
are as follows:
Name Address
Larry Anderson 176 Oakmont Road, Whg., WV 26003
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<PAGE> 3
Nancy Anderson 176 Oakmont Road, Whg., WV 26003
James R. Taylor R.D. #2, Demont Rd., Triadolphia, WV 26059
10. The name and address of the appointed person to whom notice or
process may be sent is Larry Anderson, 1015 Main Street, Wheeling, WV 26003
ACKNOWLEDGMENT
I(We), the undersigned, for the purpose of forming a corporation under the laws
of the State of West Virginia, do make and file this "Articles of
Incorporation".
In witness whereof, I(we) have accordingly hereunto set my(our)
respective hands this 29th day of March, 1990. (All incorporators must sign
below. Names and signatures must appear the same throughout the Articles of
Incorporation.) PHOTOCOPIES OF THE SIGNATURES OF THE INCORPORATOR AND THE
NOTARY PUBLIC CANNOT BE ACCEPTED
/s/ Larry Anderson
- ----------------------------------
Larry Anderson
- ---------------------------------- --------------------------------
STATE OF WEST VIRGINIA )
)
COUNTY OF OHIO )
I, Harry L. Buch, a Notary Public, in and for the county and state
aforesaid, hereby certify that (names of all incorporators as shown in item 8
must be inserted in this space by official taking acknowledgment)
LARRY ANDERSON
- ----------------------------------
- ---------------------------------- --------------------------------
whose name(s) is(are) signed to the foregoing Articles of Incorporation, this
day personally appeared before me in said county and acknowledged
his(her)(their) signature(s).
My commission expires September 20, 1997
(SEAL) /s/ Harry L. Buch
---------------------------------------
(Notary Public)
ARTICLES OF INCORPORATION PREPARED BY GOMPERS, BUSH, MCCARTHY & MCCLURE whose
mailing address is 302 BOARD OF TRADE BUILDING, WHEELING, WV 26003
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<PAGE> 1
EXHIBIT 3.23
CERTIFICATE OF INCORPORATION
OF
NELSON BROADCASTING CORPORATION
* * * * *
1. The name of the corporation is
NELSON BROADCASTING CORPORATION
2. The address of its registered office in the State of Delaware
is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington,
County of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is:
To engage in the business of owning and operating a radio station
and any and all related activities.
To engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware.
4. The total number of shares of stock which the corporation
shall have authority to issue is One Thousand (1,000) and the par value of each
of such shares is One Dollar ($1.00) amounting in the aggregate to One Thousand
Dollars ($1,000.00).
<PAGE> 2
5. The name and mailing address of each incorporator is as
follows:
NAME MAILING ADDRESS
---- ---------------
D. A. Hampton Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
J. A. Grodzicki Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
S. J. Queppet Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
6. The corporation is to have perpetual existence,
7. In furtherance and not in limitation of the powers conferred
by statute, the board of directors is expressly authorized to make, alter or
repeal the by-laws of the corporation.
8. Elections of directors need not be by written ballot unless
the by-laws of the corporation shall so provide.
Meetings of stockholders may be held within or without the State of
Delaware, as the by-laws may provide. The books of the corporation may be kept
(subject to any provision contained in the statutes) outside the State of
Delaware at such place or places as may be designated from time to time by the
board of directors or in the by-laws of the corporation.
-2-
<PAGE> 3
9. The corporation reserves the right to amend, alter, change or
repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
WE, THE UNDERSIGNED, being each of the incorporators hereinbefore
named, for the purpose of forming a corporation pursuant to the General
Corporation Law of the State of Delaware, do make this certificate, hereby
declaring and certifying that this is our act and deed and the facts herein
stated are true, and accordingly have hereunto set our hands this 7th day of
August, 1986.
/s/ D. A. Hampton
---------------------------------------
D. A. Hampton
/s/ J.A. Grodzicki
---------------------------------------
J. A. Grodzicki
/s/ S. J. Queppet
---------------------------------------
S. J. Queppet
-3-
<PAGE> 4
CERTIFICATE OF CHANGE OF LOCATION OF REGISTERED OFFICE
AND OF REGISTERED AGENT
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"corporation") is
NELSON BROADCASTING CORPORATION
2. The registered office of the corporation within the State of
Delaware is hereby changed to 32 Loockerman Square, Suite L-100, City of Dover
19901, County of Kent.
3. The registered agent of the corporation within the State of
Delaware is hereby changed to The Prentice-Hall Corporation System, Inc., the
business office of which is identical with the registered office of the
corporation as hereby changed.
4. The corporation has authorized the changes hereinbefore set
forth by resolution of its Board of Directors.
SIGNED on July 1, 1993.
/s/ Frank D. Osborn
---------------------------------------
Frank D. Osborn, President
Attest:
/s/ Heather S. McDonnell
- ------------------------------------
Heather S. McDonnell, Secretary
<PAGE> 1
EXHIBIT 3.24
CERTIFICATE OF INCORPORATION
OF
O.C.C., INC.
Pursuant to the provisions of Section 102 of the Delaware General
Corporation Act, the undersigned incorporator of O.C.C., Inc. (the "Company")
does hereby certify as follows:
ARTICLE 1
NAME
The name of the Company is O.C.C., Inc.
ARTICLE 2
REGISTERED OFFICE
The address of the registered office of the Company shall be 229 South
State Street, Dover, Kent County, Delaware. The name of the registered agent
is United States Corporation Company.
ARTICLE 3
PURPOSES
The purpose of the Company is to engage in any lawful act or activity
for which a corporation may be organized under the General Corporation Law of
Delaware.
Without limiting in any manner the scope and generality of the
foregoing, it is hereby provided that the Company shall have the following
purposes, objects and powers:
To develop, acquire, own and operate radio, television or other
broadcast properties and to engage in all activities deemed by the Company to
be necessary, advisable and attendant thereto.
ARTICLE 4
STOCK
The total number of shares of all classes of stock which the Company
shall have authority to issue is 150,000 shares of which 100,000 shares shall
be Common Stock (the "Common Stock"), par value $.01 per share, and 50,000
shares shall be Preferred Stock (the "Preferred Stock"), par value $.01 per
share.
Any notice required to be given in connection with a vote solely by a
class or series of Common or Preferred Stock shall be required to be given only
to holders of shares of such class or series of Common or Preferred Stock,
respectively, and not to the holders of shares of any other class or series of
authorized capital stock.
<PAGE> 2
Except as otherwise stated in this Certificate of Incorporation, or as
otherwise required by law, (i) each share of Common Stock of the Company shall
be equal in all respects to each other share of Common Stock and (ii) the
holders of shares of Common Stock shall be entitled to one vote for each share
of Common Stock held with respect to all matters as to which the Common Stock
is entitled to be voted.
The holders of the Common Stock shall be entitled to receive such
dividends (payable in cash, stock, or otherwise) as may be declared on the
Common Stock by the Board of Directors at any time or from time to time out of
any funds legally available therefor.
The Board of Directors, and to the extent permitted by law the
Executive Committee, if appointed, are authorized, subject to any limitations
prescribed by law and the provisions of this Article 4, to provide for the
issuance of the Common Stock and Preferred Stock in series, and by filing a
certificate pursuant to the applicable law of the State of Delaware, to
establish from time to time the number of shares to be included in each such
series and to fix the designation, powers, preferences and rights of the shares
of each such series and the qualifications, limitations or restrictions
thereof.
The authority of the Board of Directors, and to the extent permitted
by law the Executive Committee, if appointed, with respect to each series of
Common Stock or Preferred Stock shall include, but not be limited to,
determination of the following:
(1) The number of shares constituting that series and the
distinctive designation of that series;
(2) The dividend rate on the shares of that series,
whether dividends shall be cumulative, and, if so, from which date or dates,
and the relative rights of priority, if any, of payment of dividends on shares
of that series;
(3) Whether that series shall have voting rights, in
addition to any voting rights required by law, and, if so, the terms of such
voting rights, including but not limited to the right to cumulative votes for
the election of directors, the right to vote as separate class either alone or
with another class or series of stock, and the right to have more (or less)
than one vote per share;
(4) Whether or not the shares of such series shall be
convertible into or exchangeable for, at the option of either the Company or
the holder or upon the happening of a specified event, stock of any other class
or series, and, if such shares shall be so convertible, or exchangeable, the
terms and conditions of conversion or exchange, including but not limited to,
any provision for the adjustment of the conversion or exchange rate or the
conversion or exchange price.
(5) Whether or not the shares of that series shall be
redeemable, and, if so, the terms and conditions of such redemption, including
the date or dates upon or after which they shall be redeemable, and the amount
per share payable in case of redemption, which amount may vary under different
conditions and at different redemption dates;
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<PAGE> 3
(6) The rights of the holders of shares of such series in
the event of the voluntary or involuntary liquidation, dissolution or winding
up of the Company (which rights may vary depending upon the circumstances or
nature of such liquidation, dissolution or winding up); and the relationship or
preference, if any, of such rights to rights of holders of capital stock of any
other class or series; and whether or not a liquidation, dissolution or winding
up of the Company, as such terms are used in this clause (6), shall be deemed
to be occasioned by or to include any consolidation or merger of the Company
with or into any other corporation or corporations or a sale, lease or
conveyance of all or a part of the assets of the Company or any liquidation.
dissolution and/or winding up of the Company in connection therewith.
(7) Whether that series shall have a sinking fund for the
redemption or purchase of shares of that series, and, if so, the terms and
amount of such sinking fund.
(8) Any other powers, preferences and relative,
participating, optional or other specific rights or qualifications, limitations
or restrictions thereof, as shall not be inconsistent with the limitations
provided by law.
ARTICLE 5
INCORPORATOR
The name and address of the sole incorporator are as follows:
William Waller, Jr.
Waller Lansden Dortch & Davis
2100 One Commerce Place
Nashville, Tennessee 37239
ARTICLE 6
MANAGEMENT
The following provisions are inserted for the management of the
business and for the conduct of the affairs of the Company, and for further
definition, limitation and regulation of the powers of the Company and of its
directors and shareholders.
(1) The number of directors of the Company shall be such
as from time to time shall be fixed by, or in the manner provided in, the
By-Laws. Election of directors need not be by ballot unless the By-Laws so
provide.
(2) The Board of Directors shall have power to make,
alter, amend, change, add to or repeal the By-Laws of the Company; to fix and
vary the amount of Common or Preferred Stock to be reserved for any proper
purpose; to authorize and cause to be executed mortgages and liens upon all or
any part of the property of the Company; to determine the use and disposition
of any surplus or net profits; and to fix the times for the declaration and
payment of dividends.
-3-
<PAGE> 4
(3) The directors in their discretion may submit any
contract or act for approval or ratification at any annual meeting of the
shareholders or at any meeting of the shareholders called for the purpose of
considering any such act or contract, and any contract or act that shall be
approved or be ratified by the vote of the holders of a majority of the stock
of the Company which is represented in person or by proxy at such meeting and
entitled to vote thereat (provided that a lawful quorum of shareholders be
there represented in person or by proxy) shall be as valid and as binding upon
the Company and upon all the shareholders as though it had been approved or
ratified by every shareholder of the Company, whether or not the contract or
act would otherwise be open to legal attack because of directors' interest, or
for any other reason.
(4) In addition to the powers and authorities
hereinbefore or by statute expressly conferred upon them, the directors are
hereby empowered to exercise all such powers and do all such acts and things as
may be exercised or done by the Company, subject, nevertheless, to the
provisions of the statutes of Delaware, of this Certificate, and to any By-Laws
from time to time; provided, however, that no By-Laws so made shall invalidate
any prior act of the directors which would have been valid if such By-Law had
not been made.
ARTICLE 7
INDEMNIFICATION
The Company shall indemnify, and upon request shall advance expenses
to, in the manner and to the full extent permitted by law, any person (or the
estate of any person) who was or is a party to, or is threatened to be made a
party to, any threatened, pending or complete action, suit or proceeding,
whether or not by or in the right of the Company, and whether civil, criminal,
administrative, investigative or otherwise, by reason of the fact that such
person is or was a director, officer, or employee of the Company, or is or was
serving at the request of the Company as a director, officer, partner, trustee
or employee of another corporation, partnership, joint venture, trust or other
enterprise. The Company may, to the full extent permitted by law, purchase and
maintain insurance on behalf of any such person against any liability which may
be asserted against him or her. To the full extent permitted by law, the
indemnification and advances provided for herein shall include expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement.
The indemnification provided herein shall not be deemed to limit the right of
the Company to indemnify any other person for any such expenses to the full
extent permitted by law, nor shall it be deemed exclusive of any other rights
to which any person seeking indemnification from the Company may be entitled
under any agreement, vote of shareholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office.
A director shall not be personally liable to the Company or its
shareholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to
the Company or its shareholders, (ii) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law, (iii)
under Section 174 of the Delaware General Corporation Act, or (iv) for any
transaction from which the Director derived an improper personal benefit. If
the Delaware General Corporation Act is amended after approval by the
shareholders of this Section to authorize corporate action further eliminating
or limiting the personal liability of directors, then the liability of a
director of the Company shall be eliminated or
-4-
<PAGE> 5
limited to the fullest extent permitted by the Delaware General Corporation
Act, as so amended. Any repeal or modification of the foregoing portion of
this Section by the shareholders shall not adversely affect any right or
protection of a director of the Company existing at the time of such repeal or
modification.
ARTICLE 8
COMMUNICATIONS ACT REQUIREMENTS
In accordance with the Federal Communications Act of 1934, as amended
(the "Communications Act"), and regulations of the Federal Communications
Commission (the "FCC Regulations"), the Board of Directors of the Company may:
(a) prohibit the ownership or voting of more than 20% of the Company's
outstanding capital stock by or for the account of aliens or their
representatives or by a foreign government or representative thereof or by any
corporation organized under the laws of a foreign country (collectively
"Aliens"), or by or for corporations of which any officer is an Alien, more
than one-fourth of its directors are Aliens, or of which more than one-fourth
of its capital stock is owned of record or voted by Aliens; (b) prohibit any
transfer of the Company's capital stock which would cause more than 20% of the
Company's outstanding capital stock to be owned or voted by or for any person
or entity designated in foregoing clause (a); and (c) prohibit the ownership,
voting or transfer of any portion of its outstanding capital stock to the
extent the ownership, voting or transfer of such portion would cause the
Company to violate or otherwise result in violation of any provision of the
Communications Act or the FCC Regulations.
ARTICLE 9
COMPROMISE OR ARRANGEMENT
OR REORGANIZATION
Whenever a compromise or arrangement is proposed between this Company
and its creditors or any class of them and/or between this Company and its
shareholders or any class of them, any court of equitable Jurisdiction within
the State of Delaware may, on the application in a summary way of this Company
or of any creditor or shareholder thereof or on the application of any receiver
or receivers appointed for this Company under the provisions of Section 291 of
Title 8 of the Delaware Code or on the application of trustees in dissolution
or of any receiver or receivers appointed for this Company under the provisions
of Section 279 of Title 8 of the Delaware Code, order a meeting of the
creditors or class of creditors, and/or of the shareholders or class of
shareholders of this Company, as the case may be, to be summoned in such manner
as the said court directs. If a majority in number representing three-fourths
in value of the creditors or class of creditors and/or of the shareholders or
class of shareholders of this Company, as the case may be, agree to any
compromise or arrangement and to any reorganization of this Company as a
consequence of such compromise or arrangement, the said compromise or
arrangement and the said reorganization shall, if sanctioned by the court to
which the said application has been made, be binding on all the creditors or
class of creditors, and/or on all the shareholders or class of shareholders, of
this Company, as the case may be, and also on this Company.
-5-
<PAGE> 6
ARTICLE 10
UNCLAIMED DIVIDENDS
Any and all right, title, interest and claim in or to any dividends
declared by the Company, whether in cash, stock, or otherwise, which are
unclaimed by the shareholder entitled thereto for a period of six years after
the close of business on the payment date, shall be deemed to be extinguished
and abandoned; any such unclaimed dividends in the possession of the Company,
its transfer agents, or other agents or depositories, shall at such time become
the absolute property of the Company, free and clear of an and all claims of
any persons whatsoever.
ARTICLE 11
AMENDMENT
The Company reserves the right to amend, alter, change or repeal any
provision contained in this Certificate of Incorporation in the manner now or
hereafter prescribed by law, and all rights and powers conferred herein on
stockholders, directors and officers are subject to this reserved power.
IN WITNESS WHEREOF, I have hereunto set my hand and seal, the 25th day
of September, 1987.
O.C.C., INC.
/s/ William Waller, Jr.
---------------------------------------
William Waller, Jr.
-6-
<PAGE> 7
Certificate of Restoration and Revival of
Certificate of Incorporation
of
O.C.C., INC.
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"corporation") is O.C.C., INC.
2. The corporation was organized under the provisions of the
General Corporation Law of the State of Delaware. The date of filing of its
original certificate of incorporation with the Secretary of State of the State
of Delaware is September 28, 1987.
3. The address, including the street, city, and county, of the
registered office of the corporation in the State of Delaware and the name of
the registered agent at such address are as follows: The Prentice-Hall
Corporation System, Inc., 229 South State Street, Dover, Delaware 19901, County
of Kent.
4. The corporation hereby procures a restoration and revival of
its certificate of incorporation, which became inoperative by law on March 1,
1989 for failure to file annual reports and non-payment of taxes payable to the
State of Delaware.
5. The certificate of incorporation of the corporation, which
provides for and will continue to provide for, perpetual duration, shall, upon
the filing of this Certificate of Restoration and Revival of the Certificate of
Incorporation in the Department of State of the State of Delaware, be restored
and revived and shall become fully operative on February 28, 1989.
6. This Certificate of Restoration and Revival of the Certificate
of Incorporation is filed by authority of the duly elected directors as
prescribed by Section 312 of the General Corporation Law of the State of
Delaware.
Signed and attested to on August 1, 1989.
/s/ Frank D. Osborn
---------------------------------------
Frank D. Osborn
President
Attest:
/s/ Barry M. Wolper
- -----------------------------------
Barry M. Wolper
Secretary
<PAGE> 8
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
BE IT REMEMBERED that, on August 1, 1989, before me, a Notary Public
duly authorized by law to take acknowledgment of deeds, personally came Frank
D. Osborn, President of O. C. C., Inc., who duly signed the foregoing
instrument before me and acknowledged that such signing is his act and deed,
that such instrument as executed is the act and deed of said corporation, and
that the facts stated therein are true.
GIVEN under my hand on August 1, 1989.
/s/ Merrill Weber
---------------------------------------
Notary Public
-2-
<PAGE> 9
Certificate of Restoration and Revival
of
Certificate of Incorporation
of
O.C.C., Inc.
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"Corporation") is O.C.C., Inc.
2. The Corporation was organized under the provisions of the
General Corporation Law of the State of Delaware. The date of filing of its
original certificate of incorporation with the Secretary of State of the State
of Delaware is September 28, 1987.
3. The address, including the street, city, and country, of the
registered office of the Corporation in the State of Delaware and the name of
the registered agent at such address are as follows: The Prentice-Hall
Corporation System, Inc., 32 Loockerman Square, Suite L-100, Dover, Delaware
19901, County of Kent.
4. The Corporation hereby procures a restoration and revival of
this certificate of incorporation, which became inoperative by law on February
28, 1991 for failure to file annual reports and non-payment of taxes payable to
the State of Delaware.
5. The certificate of incorporation of the Corporation, which
provides for and will continue to provide for perpetual duration shall, upon
the filing of this Certificate of Restoration and Revival of the Certificate of
Incorporation in the Department of State of the State of Delaware, be restored
and revived and shall become fully operative on March 1, 1991.
6. This Certificate of Restoration and Revival of the Certificate
of Incorporation is filed by authority of the duly elected directors as
prescribed by Section 312 of the General Corporation Law of the State of
Delaware.
Signed and attested to on October 29, 1991.
/s/ Frank D. Osborn
---------------------------------------
Frank D. Osborn, President
Attest:
/s/ Heather L. Short
- -------------------------------------------
Secretary
<PAGE> 1
EXHIBIT 3.25
CERTIFICATE OF INCORPORATION
OF
ORANGE COMMUNICATIONS, INC.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follows:
1. Name. The name of the corporation is Orange Communications,
Inc. (hereinafter called the "Corporation").
2. Address; Registered Agent. The address of the Corporation's
registered office is 229 South State Street, City of Dover, County of Kent,
State of Delaware; and its registered agent at such address is United States
Corporation Company.
3. Purposes. The nature of the business and purposes to be
conducted or promoted by the Corporation are to engage in, carry on and conduct
any lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
4. Number of Shares. The total number of shares of stock which
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($0.01)
each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are:
Laurence W. Bates
c/o Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, New York 10019
<PAGE> 2
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Limitation of Liability. No director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, except for liability (i)
for any breach of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the Delaware General Corporation Law, or (iv) for any transaction from which
the director derived any improper personal benefit.
Any repeal or modification or the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a director of the Corporation existing at the time of such repeal
or modification.
8. Addition, Amendment and/or Repeal or By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original by-laws of the Corporation) make, alter or repeal the by-laws of its
Corporation; provided, that any by-laws made, amended or repealed by the Board
of Directors may be amended or repealed, and any by-laws may be made by the
stockholders of the Corporation.
IN WITNESS WHEREOF, this Certificate has been signed on this 22nd day
of October, 1986.
/s/ Laurence W. Bates
---------------------------------------
Laurence W. Bates, Incorporator
-2-
<PAGE> 3
CERTIFICATE
FOR RENEWAL AND REVIVAL OF CHARTER
ORANGE COMMUNICATIONS, INC., a corporation organized under the laws of
Delaware, the charter of which was voided for non-payment of taxes, now desires
to procure a restoration, renewal and revival of its charter, and hereby
certifies as follows:
1. The name of this corporation is Orange Communications, Inc.
2. Its registered office in the State of Delaware is located at
32 Loockerman Square, Suite L-100 Street, City of Dover Zip Code 19901, County
of Kent the name and address of its registered agent is The Prentice-Hall
Corporation System, Inc., 32 Loockerman Square, Suite L-100, Dover, Delaware
19901.
3. The date of filing of the original Certificate of
Incorporation in Delaware was October 27, 1986.
4. The date when restoration, renewal, and revival of the charter
of this company is to commence is the 28th day of February, 1990, same being
prior to the date of the expiration of the charter. This renewal and revival
of the charter of this corporation is to be perpetual.
5. This corporation was duly organized and carried on the
business authorized by its charter until the First day of March, A.D. 1990 at
which time its charter became inoperative and void for non-payment of taxes and
this certificate for renewal and revival is filed by authority of the duly
elected directors of the corporation in accordance with the laws of the State
of Delaware.
IN TESTIMONY WHEREOF, and in compliance with the provisions of Section
312 of the General Corporation Law of the State of Delaware, as amended,
providing for the renewal, extension and restoration of charters, Frank D.
Osborn the last and acting President, and Barry M. Wolper, the last and acting
Secretary of Orange Communications, Inc., have hereunto set their hands to this
certificate this 23rd day of August, 1991.
/s/ Frank D. Osborn
---------------------------------------
Last and Acting President
/s/ Barry M. Wolper
---------------------------------------
Last and Acting Secretary
<PAGE> 1
EXHIBIT 3.26
CERTIFICATE OF INCORPORATION
OF
OSBORN ENTERTAINMENT CORPORATION
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follows:
1. Name. The name of the corporation is Osborn Entertainment
Corporation.
2. Address; Registered Agent. The address of the Corporation's
registered office is 229 South State Street, City of Dover, County of Kent,
State of Delaware; and its registered agent at such address is The
Prentice-Hall Corporation System, Inc.
3. Purposes. The nature of the business and purposes to be
conducted or promoted by the Corporation are to engage in, carry on and conduct
any lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
4. Number of Shares. The total number of shares of stock which
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are: Jay Itzkowitz 1285 Avenue of the Americas,
New York, New York 10019.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original by-laws of the Corporation) make, alter or repeal the by-laws of the
Corporation; provided, that any by-laws made, amended or repealed
<PAGE> 2
by the Board of Directors may be amended or repealed, and any by-laws may be
made, by the stockholders of the Corporation.
IN WITNESS WHEREOF, this Certificate has been signed on this 13th day
of May, 1988.
/s/ Jay Itzkowitz
---------------------------------------
Jay Itzkowitz, Incorporator
-2-
<PAGE> 3
CERTIFICATION OF AMENDMENT OF
CERTIFICATE OF INCORPORATION
OF
OSBORN ENTERTAINMENT CORPORATION
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"Corporation") is Osborn Entertainment Corporation.
2. The Amendment to the Certificate of Incorporation of the
Corporation set forth in the following numbered paragraph was duly adopted in
accordance with Section 242 of the General Corporation Law of the State of
Delaware.
3. RESOLVED, that the Certificate of Incorporation of the
Corporation be, and it hereby is, amended by striking out Article 4 thereof and
by substituting in lieu of said Article the following new Article 4:
"4. Number of Shares.
A. Total Capitalization. The total number of
shares of stock which the Corporation shall have authority to issue
is: one thousand five hundred (1,500), of which one thousand (1000)
shall be shares of Common Stock, par value of one cent ($.01) each
("Common Stock"), and of which five hundred (500) shall be shares of
Preferred Stock, par value of one cent ($.01) each ("Preferred
Stock"). Of the Preferred Stock, 400 shares shall be designated Voting
Preferred Stock and 100 shares shall be designated Non-Voting
Preferred Stock.
B. The Preferred Stock.
(1) Dividends and Distributions. No
dividend or distributions shall be declared or paid or set apart for
payment, or other distribution declared or made upon the Preferred
Stock, except to the extent identical dividends or distribution shall
be declared or paid or set apart for payment, or other distribution
declared or made, as the case may be, upon the Common Stock. The
foregoing restrictions shall be inapplicable to (a) any payments in
lieu of issuance of fractional shares thereof, whether upon any
merger, conversion or otherwise; (b) the acquisition of any shares of
Common Stock or Preferred Stock of the Corporation in connection with
the settlement of disputes arising out of acquisitions by the
Corporation pursuant to which such stock were issued; or (c) the
rescission of any acquisition or disposition by the Corporation
pursuant to which such stock was issued.
<PAGE> 4
(2) Voting. The borders of Voting
Preferred Stock shall vote on all matters, except as may be required by law,
together with the holders of the Common Stock, with each share, irrespective of
its class, entitling the holder thereof to one vote. Except to the extent
required by applicable law, the holders of Non-Voting Preferred Stock shall
have no right to vote on any matter presented for a vote of the Stockholders of
the Corporation (including without limitation the election or removal of
directors), and Non-Voting Preferred Stock shall not be included in determining
the number of shares voting or entitled to vote on such matters.
(3) Dissolution and Liquidation. In the
case of the dissolution or liquidation of the Corporation, the holders of
Preferred Stock shall be entitled to receive and to be paid out of the assets
of the Corporation available for distribution to its stockholders, before any
payment or distribution shall be made on the Common Stock, all amounts paid or
distributed by the Corporation up to $1,000 per share of Preferred Stock; no
further distribution shall be made to holders of Preferred Stock thereafter,
until the total amount so paid or distributed to holders of the Common Stock
shall equal $1,000 per share of Common Stock; and thereafter all distributions
shall be made pro rata to the holders of Preferred Stock and the holders of
Common Stock without regard to the class of capital stock so held by any
holder; provided, that none of the sale, transfer or lease of all or
substantially all of the property or business of the Corporation, the merger or
consolidation of the Corporation into or with any other corporation or the
merger or consolidation of any other corporation into or with the Corporation
or any dissolution, liquidation, winding up or reorganization of the
Corporation followed, in each case, by the recapitalization of another
corporation succeeding to the business and obligations of the Corporation,
shall be deemed to be a dissolution, liquidation or winding up, voluntary or
involuntary, for the purposes hereof, provided that in each case effective
provision is made in the certification of incorporation of the resulting
corporation or otherwise for the protection of the rights of the holders of
Preferred Stock. After the payment of the holders of the shares of Preferred
Stock of the full preferential amounts provided for above, the holders of
Preferred Stock as such shall have no right or claim to any of the remaining
assets of the Corporation.
(4) Conversion. The holders of Voting
Preferred Stock may exchange their shares of Voting Preferred Stock, upon
demand and for no additional consideration, for shares of Common Stock at a
ratio of one share of Common Stock for each share of Voting Preferred Stock;
and the holders of Non-Voting Preferred Stock may exchange their shares of
Non-Voting Preferred Stock, upon demand and for no additional consideration,
for shares of Common Stock, at a ratio of one share of Common Stock for each
share of Non-Voting Preferred Stock (subject in each case to any stock splits,
recapitalizations, redemptions, liquidations, mergers, consolidations,
split-ups, spin-offs, or exchanges or conversions of shares or the like). The
Corporation shall at all times reserve and keep available out of its authorized
but unissued shares of Common Stock or its treasury shares, Common Stock in a
quantity sufficient to provide for the conversion of all outstanding shares of
Preferred Stock into Common Stock.
-2-
<PAGE> 5
C. Common Stock Dividends and Distributions. So
long as any shares of Preferred Stock are outstanding, no dividends or
distribution shall be declared or paid or set apart for payment, or
other distribution declared or made upon the Common Stock, except to the
extent identical dividends or distributions may be declared or paid or
set apart for payment, or other distribution declared or made, as the
case may be, upon the Preferred Stock. The foregoing restrictions shall
be inapplicable to (a) any payments in lieu of issuance of fractional
shares thereof, whether upon any merger, conversion or otherwise; (b)
the acquisition of any shares of Common Stock of the Corporation in
connection with the settlement of disputes arising out of acquisitions
by the Corporation pursuant to which such stock was issued; or (c) the
rescission of any acquisition or disposition by the Corporation pursuant
to which such stock was issued."
4. The amendment of the Certificate of Incorporation of
the Corporation herein certificated was duly adopted, pursuant to the
provisions of Section 242 of the General Corporation Law of the State of
Delaware, by the sole stockholder and sole director of the Corporation.
Signed on August 22, 1988.
/s/ Frank D. Osborn
---------------------------------------
Frank D. Osborn
Sole Stockholder and Sole Director
STATE OF YORK )
) ss
COUNTY OF NEW YORK )
BE IT REMEMBERED that, on August 22, 1988, before me, a Notary Public
duly authorized by law to take acknowledgment of deeds, personally came Frank
D. Osborn, the President of Osborn Communications Corporation, who duly signed
the foregoing instrument before me and acknowledged that much signing in his
act and deed, that such instrument as executed is the act and deed of said
corporation, and that the facts stated therein are true.
GIVEN under my hand on August 22, 1988.
/s/ Heather L. Short
---------------------------------------
Notary Publics
-3-
<PAGE> 6
CERTIFICATION OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
OSBORN ENTERTAINMENT CORPORATION
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"Corporation") is Osborn Entertainment Corporation.
2. The Amendment to the Certificate of Incorporation of the
Corporation set forth in the following numbered paragraph was duly adopted in
accordance with Section 242 of the General Corporation Law of the State of
Delaware.
3. RESOLVED, that the Certificate of Incorporation of the
Corporation be, and it hereby is, amended by striking out paragraph A of
Article 4 thereof and by substituting in lieu of said paragraph the following
new Paragraph 4A:
"A. Total Capitalization. The total number of shares
of stock which the Corporation shall have authority to issue is ten thousand
five hundred (10,500), of which ten thousand (10,000) shall be shares of common
stock, par value of one cent ($.01) each ("Common Stock"), and of which five
hundred (500) shall be shares of Preferred Stock, par value of one cent ($.01)
each ("Preferred Stock"). Of the Preferred Stock, 400 shares shall be
designated Voting Preferred Stock and 100 shares shall be designated Non-Voting
Preferred Stock."
4. The amendment of the Certificate of Incorporation of the
Corporation herein certified was duly adopted, pursuant to the provisions of
Section 242 of the General Corporation Law of the State of Delaware, by the
stockholders and sole director of the Corporation.
Signed on July 29, 1991
/s/ Frank D. Osborn
---------------------------------------
Frank D. Osborn
President
<PAGE> 7
I, Heather L. Short, Secretary of the Corporation, do hereby certify
that Frank D. Osborn is the duly elected and qualified President of the
Corporation and that he occupies such office on the date hereof and that the
signature of Frank D. Osborn above is his true and correct signature.
IN WITNESS WHEREOF, I have hereunto set my hand this 29th of July, 1991.
/s/ Heather L. Short
---------------------------------------
Heather L. Short
Secretary
-2-
<PAGE> 8
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
OSBORN ENTERTAINMENT CORPORATION
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"Corporation") is Osborn Entertainment Corporation.
2. The Amendment to the Certificate of Incorporation of the
Corporation set forth in the following numbered paragraph was duly adopted in
accordance with Section 242 of the General Corporation Law of the State of
Delaware.
3. RESOLVED, that the Certificate of Incorporation of the
Corporation be, and it hereby is, amended by changing the FIRST Article thereof
so that, as amended, said Article shall be read as follows:
"The name of this Corporation (hereinafter called the corporation) is Osborn
Healthcare Communications, Inc."
4. The amendment of the Certificate of Incorporation of the
Corporation herein certified was duly adopted, pursuant to the provisions of
Section 242 of the General Corporation Law of the State of Delaware, by the
stockholders and sole director of the Corporation.
Signed on August 26, 1991
/s/ Frank D. Osborn
--------------------------------------
Frank D. Osborn
Chairman of the Board
<PAGE> 9
I, Heather L. Short, Secretary of the Corporation, do hereby certify
that Frank D. Osborn is the duly elected and qualified Chairman of the Board of
the Corporation and that he occupied such office on the date hereof and that
the signature of Frank D. Osborn above is a true and correct signature.
IN WITNESS WHEREOF, I have hereunto set my hand this 26th day of
August, 1991.
/s/ Heather L. Short
---------------------------------------
Heather L. Short
Secretary
-2-
<PAGE> 1
EXHIBIT 3.27
CERTIFICATE OF INCORPORATION
OF
OSBORN SOUND & COMMUNICATIONS CORP.
1. The name of the corporation is Osborn Sound & Communications
Corp.
2. The address of its registered office in the State of Delaware
is 1209 Orange Street, in the City of Wilmington, County of New Castle. The
name of its registered agent at such address is The Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is:
To engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of
Delaware,
4. The total number of shares of stock which the corporation
shall have authority to issue is One Hundred Ten Thousand (110,000) of which
Ten Thousand shares of the par value of One Dollar ($1.00) each, amounting in
the aggregate to Ten Thousand Dollars ($10,000) shall be preferred stock, and
of which One Hundred Thousand (100,000) shares of the par value of one cent
($.01) each, amounting in the aggregate to One Thousand Dollars ($1,000) shall
be common stock.
5. The Board of Directors of the corporation is authorized to
issue the Preferred Stock of the corporation from time to time in one or more
series with distinctive serial designations:
(a) with voting powers, full or limited, or no voting
powers, and such designations, preferences and
relative, participating, option or other special
rights, and qualifications, limitations, or
restrictions;
(b) subject, or not subject to, redemption at such time
or times and at such price or prices;
(c) with the right to receive dividends at such rates, on
such conditions and at such times, and payable in
preference to, or in such relations to, the dividends
payable on any other class or classes or any other
series of stock and cumulative or noncumulative;
(d) with rights, upon the dissolution of, or upon
distribution of the assets of the corporation; and
(e) convertible into, or exchangeable for any other class
or classes of stock or any series thereof, of the
corporation at such price or prices or at such rates
of exchange with such adjustments;
<PAGE> 2
as shall be stated in the resolution or resolutions provided for the issue of
such stock adopted by the Board of Directors. Preferred Stock shall not have
any vote except as required by law or as provided in the resolution or
resolutions of the Board of Directors of the corporation delineating the rights
and liabilities of the class or series.
6. The name and mailing address of the incorporator is as
follows:
NAME MAILING ADDRESS
---- ---------------
Martin Mushkin Blodnick, Schultz & Abramowitz, P.C.
3111 New Hyde Park Road
Lake Success, New York 11042-1273
7. The corporation is to have perpetual existence.
8. In furtherance and not in limitation of the powers conferred
by statute, the board of directors is expressly authorized to make, alter or
repeal the by-laws of the corporation.
9. The corporation reserves the right to amend, alter, change or
repeat any provision contained in this certificate of incorporation in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
10. Any and all right, title, interest and claim in or to any
dividends declared by the corporation, whether in cash, stock, or otherwise,
which are unclaimed by the stockholder entitled thereto for a period of six
years after the close of business on the payments date, shall be deemed to be
extinguished and abandoned; any such unclaimed dividends in the possession of
the corporation, its transfer agents, or other agents or depositories, shall at
such time become the absolute property of the corporation, free and clear of
any and all claims of any persons whatsoever.
11. The corporations shall, to the fullest extent permitted by
Section 145 of the General Corporation Law of the State of Delaware, as the
same may be amended and supplemented, indemnify any and all persons whom it
shall have power to indemnify under said section from and against any and all
of the expenses, liabilities or other matters referred to in or covered by said
section, and the indemnification provided for herein shall not be deemed
exclusive of any other rights to which those indemnified may be entitled under
any agreement, vote of stockholders or disinterested directors or otherwise,
both as to action in his official capacity and as to action in any other
capacity while holding such office, and shall continue as to a person who has
ceased to be director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.
-2-
<PAGE> 3
I, THE UNDERSIGNED, being the sole incorporator hereinbefore named,
for the purpose of forming a corporation pursuant to the General Corporation
Law of the State of Delaware, do make this certificate hereby declaring and
certifying that this is my act and deed and the facts herein stated are true,
and accordingly, have hereunto set my hand this 15th day of November, 1985.
/s/ Martin Mushkin
---------------------------------------
MARTIN MUSHKIN
-3-
<PAGE> 4
CERTIFICATE OF MERGER
OF
OSBORN SOUND & COMMUNICATIONS OF FLORIDA, INC.,
OSBORN SOUND & COMMUNICATIONS OF GEORGIA, INC.
AND
WHEELING ENTERTAINMENT CORPORATION
INTO
OSBORN HEALTHCARE COMMUNICATIONS, INC.
The undersigned corporation organized and existing under and by virtue
of the General Corporation Law of Delaware,
DOES HEREBY CERTIFY:
FIRST: That the name and state of incorporation of each of the
constituent corporations of the merger is as follows:
NAME STATE OF INCORPORATION
Osborn Sound & Communications of Florida, Inc. Delaware
Osborn Sound & Communications of Georgia, Inc. Delaware
Wheeling Entertainment Corporation Delaware
Osborn Healthcare Communications, Inc. Delaware
SECOND: That a Plan and Agreement of Merger between the parties to
the merger has been approved, adopted, certified, executed and acknowledged by
each of the constituent corporations in accordance with the requirements of
section 251 of the General Corporation Law of Delaware.
<PAGE> 5
THIRD: That the name of the surviving corporation of the merger is
Osborn Healthcare Communications, Inc., which shall herewith be changed to
Osborn Entertainment Enterprises Corporation.
FOURTH: That the amendments or changes in the Certificate of
Incorporation of Osborn Healthcare Communications, Inc., the surviving
corporation, are to be effected by the merger as follows:
Article 1 of the Certificate of Incorporation of the surviving
corporation shall be amended to read: "1. The name of the corporation (the
"Corporation") is Osborn Entertainment Enterprises Corporation."
FIFTH: That the executed Plan and Agreement of Merger is on file at
the principal place of business of the surviving corporation, the address of
which is: 130 Mason Street, Greenwich, Connecticut 06830.
SIXTH: That a copy of the Plan and Agreement of Merger will be
furnished by the surviving corporation, on request and without cost, to any
stockholder of any constituent corporation.
SEVENTH: That this Certificate of Merger shall be effective on
December 22, 1995.
Dated: December 22, 1995
OSBORN HEALTHCARE COMMUNICATIONS, INC.
By: /s/ Frank D. Osborn
--------------------
Frank D. Osborn
Chairman
Attest:
By: /s/ Michael F. Mangan
----------------------
Michael F. Mangan
Secretary
2
<PAGE> 6
CERTIFICATE OF CHANGE OF LOCATION OF REGISTERED OFFICE
AND OF REGISTERED AGENT
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"corporation") is
OSBORN SOUND & COMMUNICATIONS CORP.
2. The registered office of the corporation within the State of
Delaware is hereby changed to 32 Loockerman Square, Suite L-100, City of Dover
19901, County of Kent.
3. The registered agent of the corporation within the State of
Delaware is hereby changed to The Prentice-Hall Corporation System, Inc., the
business office of which is identical with the registered office of the
corporation as hereby changed.
4. The corporation has authorized the changes hereinbefore set
forth by resolution of its Board of Directors.
SIGNED on November 2, 1992.
/s/ Frank D. Osborn
----------------------------------------
Frank D. Osborn, President
Attest:
/s/ Josephine Osborn
- -----------------------------------
Josephine Osborn, Secretary
<PAGE> 1
EXHIBIT 3.28
CERTIFICATE OF INCORPORATION
of
RKZ TELEVISION, INC.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is RKZ Television, Inc.
(hereinafter called the "Corporation").
2. Address; Registered Agent. The address of the Corporation's
registered office is 229 South State Street, City of Dover, County of Kent,
State of Delaware; and its registered agent at such address is United States
Corporation Company.
3. Purposes. The nature of the business and purposes to be
conducted or promoted by the Corporation are to engage in, carry on and conduct
any lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are:
Laurence W. Bates
c/o Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, New York 10019
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
<PAGE> 2
7. Limitation of Liability. No director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, except for liability (i)
for any breach of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the Delaware General Corporation Law or (iv) for any transaction from which
the director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a director of the Corporation existing at the time of such repeal
or modification.
8. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original by-laws of the Corporation) make, alter or repeal the by-laws of the
Corporation; provided, that any by-laws made, amended or repealed by the Board
of Directors may be amended or repealed, and any by-laws may be made, by the
stockholders of the Corporation.
IN WITNESS WHEREOF, this Certificate has been signed on this 26th day
of March, 1987.
/s/ Lawrence W. Bates
---------------------------------------
Lawrence W. Bates, Incorporator
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<PAGE> 1
EXHIBIT 3.29
CERTIFICATE OF INCORPORATION
of
GADSDEN BROADCASTING CORP.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is Gadsden Broadcasting
Corp. (the "Corporation").
2. Address; Registered Office and Agent. The address of the
Corporation's registered office is 32 Loockerman Square, Suite L-100, City of
Dover, County of Kent, State of Delaware; and its registered agent at such
address is The Prentice-Hall Corporation System, Inc.
3. Purposes. The purpose of the Corporation is to engage in,
carry on and conduct any lawful act or activity for which corporations may be
organized under the Delaware General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and address of Incorporator. The name and mailing
address of the incorporator are: Heather S. McDonnell, Osborn Communications
Corporation, 405 Lexington Avenue, 54th Floor, New York, NY 10174.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Limitation of Liability. No Director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a Director,
<PAGE> 2
except for liability (a) for any breach of the Director's duty of loyalty to
the Corporation or its stockholders, (b) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(c) under Section 174 of the Delaware General Corporation Law or (d) for any
transaction from which the Director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a Director of the Corporation existing at the time of such repeal
or modification.
8. Indemnification.
8.1 To the extent not prohibited by law, the Corporation
shall indemnify any person who is or was made, or threatened to be made, a
party to any threatened, pending or completed action, suit or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative,
including, without limitation, an action by or in the right of the Corporation
to procure a judgment in its favor, by reason of the fact that such person, or
a person of whom such person is the legal representative, is or was a Director
or officer of the Corporation, or is or was serving in any capacity at the
request of the Corporation for any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise (an "Other Entity"),
against judgments, fines, penalties, excise taxes, amounts paid in settlement
and costs, charges and expenses (including attorneys' fees and disbursements).
Persons who are not Directors or officers of the Corporation may be similarly
indemnified in respect of service to the Corporation or to an Other Entity at
the request of the Corporation to the extent the Board at any time specifies
that such persons are entitled to the benefits of this Section 8.
8.2 The Corporation shall, from time to time, reimburse or advance
to any Director or officer or other person entitled to indemnification
hereunder the funds necessary for payment of
-2-
<PAGE> 3
expenses, including attorneys' fees and disbursements, incurred in connection
with any Proceeding, in advance of the final disposition of such Proceeding;
provided, however, that, if required by the Delaware General Corporation Law,
such expenses incurred by or on behalf of any Director or officer or other
person may be paid in advance of the final disposition of a Proceeding only
upon receipt by the Corporation of an undertaking, by or on behalf of such
Director of officer (or other person indemnified hereunder), to repay any such
amount so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right of appeal that such Director,
officer or other person is not entitled to be indemnified for such expenses.
8.3 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or reimbursement or advancement of expenses may have or hereafter be entitled
under any statute, this Certificate of Incorporation, the By-laws of the
Corporation (the "By-laws"), any agreement, any vote of stockholders or
disinterested Director or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
8.4 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall continue
as to a person who has ceased to be a Director or officer (or other person
indemnified hereunder) and shall inure to the benefit of the executors,
administrators, legatees and distributees of such person.
8.5 The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a Director, officer, employee
or agent of the Corporation, or is or was serving at the request of the
Corporation as a director, officer, employee or agent of an Other Entity,
against any liability asserted against such person and incurred by such person
in any such capacity,
-3-
<PAGE> 4
or arising out of such person's status as such, whether or not the Corporation
would have the power to indemnify such person against such liability under the
provisions of this Section 8, the By-laws or under Section 145 of the Delaware
General Corporation Law or any other provision of law.
8.6 The provisions of this Section 8 shall be a contract between
the Corporation, on the one hand, and each Director and officer who serves in
such capacity at any time while this Section 8 is in effect and any other
person indemnified hereunder, on the other hand, pursuant to which the
Corporation and each such Director, officer, or other person intend to be
legally bound. No repeal or modification of this Section 8 shall affect any
rights or obligations with respect to any state of facts then or theretofore
existing or thereafter arising or any proceeding theretofore or thereafter
brought or threatened based in whole or in part upon any such state of facts.
8.7 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall be
enforceable by any person entitled to such indemnification or reimbursement or
advancement of expenses in any court of competent jurisdiction. The burden of
proving that such indemnification or reimbursement or advancement of expenses
is not appropriate shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) to have made a determination prior to the commencement of
such action that such indemnification or reimbursement or advancement of
expenses is proper in the circumstances nor an actual determination by the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) that such person is not entitled to such indemnification
or reimbursement or advancement of expenses shall constitute a defense to the
action or create a presumption that such person is not so entitled. Such a
person shall also be indemnified for any expenses incurred in
-4-
<PAGE> 5
connection with successfully establishing his or her right to such
indemnification or reimbursement or advancement of expenses, in whole or in
part, in any such proceeding.
8.8 Any Director or officer of the Corporation serving in any
capacity (a) another corporation of which a majority of the shares entitled to
vote in the election of its directors is held, directly or indirectly, by the
Corporation or (b) any employee benefit plan of the Corporation or any
corporation referred to in clause (a) shall be deemed to be doing so at the
request of the Corporation.
8.9 Any person entitled to be indemnified or to reimbursement or
advancement of expenses as a matter of right pursuant to this Section 8 may
elect to have the right to indemnification or reimbursement or advancement of
expenses interpreted on the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advance of
expenses is sought. Such election shall be made, by a notice in writing to the
Corporation, at the time indemnification or reimbursement or advancement of
expenses is sought; provided, however, that if no such notice is given, the
right to indemnification or reimbursement or advancement of expenses shall be
determined by the law in effect at the time indemnification or reimbursement of
advancement of expenses is sought.
9. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original By-laws) make, alter or repeal the By-laws by a vote of two-thirds of
the entire Board of Directors that would be in office if no vacancy existed,
whether or not present at a meeting; provided, however, that any By-laws made,
amended or repealed by the Board of Directors may be amended or repealed, and
any By- laws may be made, by the stockholders of the Corporation by a vote of a
majority of the holders of shares of stock of the Corporation entitled to vote
in the election of Directors of the Corporation.
-5-
<PAGE> 6
WITNESS the signature of this Certificate this 22 of October, 1993.
/s/ Heather S. McDonnell
---------------------------------
Heather S. McDonnell
Incorporator
-6-
<PAGE> 7
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
GADSDEN BROADCASTING CORP.
(PURSUANT TO SECTION 242 OF THE
GENERAL CORPORATION LAW OF THE STATE OF DELAWARE)
Gadsden Broadcasting Corp., a corporation organized and existing under
the laws of the State of Delaware (the "Corporation"), hereby certifies as
follows:
1. The name of the Corporation is Gadsden Broadcasting Corp.
2. This Certificate of Amendment amends the Certificate of
Incorporation now in effect to change the name of the Corporation to Rainbow
Broadcasting Corporation.
3. This Certificate of Amendment was duly adopted by written
consent, dated as of March 19, 1996, of the sole director of the Corporation in
accordance with Section 141(f) of the General Corporation Law.
4. Section 1 of the Certificate of Incorporation is hereby
amended to read in its entirety as follows:
"1. NAME. The name of the Corporation is Rainbow
Broadcasting Corporation (the "Corporation")."
5. The aforesaid amendment was duly adopted in accordance with
the applicable provision of Section 242 of the General Corporation Law.
<PAGE> 8
IN WITNESS WHEREOF, the Corporation has authorized the undersigned to
execute this Certificate of Amendment this 19th day of March, 1996.
GADSDEN BROADCASTING CORP.
By: /s/ Frank D. Osborn
---------------------------
Frank D. Osborn
President
ATTEST:
By: /s/ Michael F. Mangan
----------------------------
Michael F. Mangan
Secretary
<PAGE> 1
EXHIBIT 3.30
CERTIFICATE OF INCORPORATION
of
OSBORN OF OHIO, INC.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is OSBORN OF OHIO, INC.
2. Address; Registered Agent. The address of the Corporation's
registered office is 229 South State Street, City of Dover, County of Kent,
State of Delaware; and its registered agent at such address is The
Prentice-Hall Corporation System, Inc.
3. Purposes. The nature of the business and purposes to be
conducted or promoted by the Corporation are to engage in, carry on and conduct
any lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are: Merrill Weber, Esq., 1285 Avenue of the
Americas, New York, New York 10019.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Limitation of Liability. No director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, except for liability (i)
for any breach of the director's duty of loyalty to the Corporation or its
<PAGE> 2
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the Delaware General Corporation Law, or (iv) for any transaction from which
the director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a director of the Corporation existing at the time of such repeal
or modification.
8. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original by-laws of the Corporation) make, alter or repeal the by-laws of the
Corporation; provided, that any by-laws made, amended or repealed by the Board
of Directors may be amended or repealed, and any by-laws may be made, by the
stockholders of the Corporation.
IN WITNESS WHEREOF, this Certificate has been signed on this 15th day
of September, 1988.
/s/ Merrill Weber
-----------------------------
Merrill Weber, Incorporator
-2-
<PAGE> 3
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OSBORN OF OHIO, INC., a corporation organized and existing under and
by virtue of the General Corporation Law of the State of Delaware (the
"Corporation") DOES HEREBY CERTIFY:
FIRST: The sole Director of the Corporation, by written consent,
filed with the minutes of the board a resolution proposing and declaring
advisable the following amendment to the Certificate of Incorporation of the
Corporation:
RESOLVED, that the Certificate of Incorporation of Osborn of
Ohio, Inc. be amended by changing the FIRST Article thereof so that,
as amended, said Article shall be and read as follows:
"The name of this Corporation (hereinafter called the
'corporation') is Short Broadcasting Corporation."
SECOND: That in lieu of a meeting and vote of stockholders,
the sole Stockholder has given written consent to said amendment in accordance
with the provisions of Section 228(a) of the General Corporation Law of the
State of Delaware.
<PAGE> 4
IN WITNESS WHEREOF, the Corporation has caused this certificate to be
signed by its President, and attested by its Secretary this 8th day of
February, 1989.
OSBORN OF OHIO, INC.
/s/ Frank D. Osborn
----------------------------
Frank D. Osborn, President
ATTEST:
By: /s/ Josephine N. Osborn
--------------------------------------
Josephine N. Osborn, Secretary
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<PAGE> 1
EXHIBIT 3.31
CERTIFICATE OF INCORPORATION
of
SNG HOLDINGS, INC.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is SNG HOLDINGS, INC.
2. Address; Registered Agent. The address of the
Corporation's registered office is 32 Loockerman Square, Suite L-100, City of
Dover 19901, County of Kent, State of Delaware; and its registered agent at
such address is The Prentice-Hall Corporation System, Inc.
3. Purposes. The nature of the business and purposes to be
conducted or promoted by the Corporation are to engage in, carry on and conduct
any lawful act or activity for which corporations may be organized under the
Delaware General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock, par value one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are: Heather L. Short, Osborn Communications
Corporation, 405 Lexington Avenue 54th Floor, New York, NY 10174.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
7. Personal Liability. The personal liability of the directors
of the Corporation is hereby eliminated to the fullest extent permitted by the
provisions of paragraph (7) of subsection (b) of
<PAGE> 2
subsection 102 of the General Corporation Law of the State of Delaware, as the
same may be amended and supplemented.
8. Indemnification. The Corporation shall, to the fullest extent
permitted by the provisions of subsection 145 of the General Corporation Law of
the State of Delaware, as the same may be amended and supplemented, indemnify
any and all persons whom it shall have power to indemnify under said section
from and against any and all of the expenses, liabilities, or other matters
referred to in or covered by said section, and the indemnification provided for
herein shall not be deemed exclusive of any other rights to which those
indemnified may be entitled under any bylaw, agreement, vote of stockholders or
disinterest directors of or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office, and
shall continue as to a person who has cased to be a director, officer,
employee, or agent and shall inure to the benefit of the heirs, executors, and
administrators of such a person.
9. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original by-laws of the Corporation) make, alter or repeal the by-laws of the
Corporation; provided, that any by-laws made, amended or repealed by the Board
of Directors may be amended or repealed, and any by-laws may be made, by the
stockholders of the Corporation.
IN WITNESS WHEREOF, this Certificate has been signed on this 1st day
of November, 1991.
/s/ Heather L. Short
-----------------------------
Heather L. Short
Incorporator
-2-
<PAGE> 1
EXHIBIT 3.32
CERTIFICATE OF INCORPORATION
of
SOUTHEAST RADIO HOLDING CORP.
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is Southeast Radio Holding
Corp. (the "Corporation").
2. Address; Registered Office and Agent. The address of the
Corporation's registered office is 32 Loockerman Square, Suite L-100, City of
Dover, County of Kent, State of Delaware; and its registered agent at such
address is The Prentice-Hall Corporation System, Inc.
3. Purposes. The purpose of the Corporation is to engage in,
carry on and conduct any lawful act or activity for which corporations may be
organized under the Delaware General Corporation Law.
4. Number of Shares. The total number of shares of stock that
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are: Heather S. McDonnell, Osborn Communications
Corporation, 405 Lexington Avenue, 54th Floor, New York, NY 10174.
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
<PAGE> 2
7. Limitation of Liability. No Director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a Director, except for liability (a)
for any breach of the Director's duty of loyalty to the Corporation or its
stockholders, (b) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (c) under Section 174 of
the Delaware General Corporation Law or (d) for any transaction from which the
Director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a Director of the Corporation existing at the time of such repeal
or modification.
8. Indemnification.
8.1 To the extent not prohibited by law, the Corporation
shall indemnify any person who is or was made, or threatened to be made, a
party to any threatened, pending or completed action, suit or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative,
including, without limitation, an action by or in the right of the Corporation
to procure a judgment in its favor, by reason of the fact that such person, or
a person of whom such person is the legal representative, is or was a Director
or officer of the Corporation, or is or was serving in any capacity at the
request of the Corporation for any other corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise (an "Other Entity"),
against judgments, fines, penalties, excise taxes, amounts paid in settlement
and costs, charges and expenses (including attorneys' fees and disbursements).
Persons who are not Directors or officers of the Corporation may be similarly
indemnified in respect of service to the Corporation or to an Other Entity at
the request of the Corporation to the extent the Board at any time specifies
that such persons are entitled to the benefits of this Section 8.
-2-
<PAGE> 3
8.2 The Corporation shall, from time to time, reimburse or advance
to any Director or officer or other person entitled to indemnification
hereunder the funds necessary for payment of expenses, including attorneys'
fees and disbursements, incurred in connection with any Proceeding, in advance
of the final disposition of such Proceeding; provided, however, that, if
required by the Delaware General Corporation Law, such expenses incurred by or
on behalf of any Director or officer or other person may be paid in advance of
the final disposition of a Proceeding only upon receipt by the Corporation of
an undertaking, by or on behalf of such Director or officer (or other person
indemnified hereunder), to repay any such amount so advanced if it shall
ultimately be determined by final judicial decision from which there is no
further right of appeal that such Director, officer or other person is not
entitled to be indemnified for such expenses.
8.3 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
or reimbursement or advancement of expenses may have or hereafter be entitled
under any statute, this Certificate of Incorporation, the By-laws of the
Corporation (the "By-laws"), any agreement, any vote of stockholders or
disinterested Director or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.
8.4 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall continue
as to a person who has ceased to be a Director or officer (or other person
indemnified hereunder) and shall inure to the benefit of the executors,
administrators, legatees and distributees of such person.
8.5 The Corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a Director, officer, employee
or agent of the Corporation, or is or was
-3-
<PAGE> 4
serving at the request of the Corporation as a director, officer, employee or
agent of an Other Entity, againstany liability asserted against such person and
incurred by such person in any such capacity, or arising out of such person's
status as such, whether or not the Corporation would have the power to
indemnify such person against such liability under the provisions of this
Section 8, the By-laws or under Section 145 of the Delaware General Corporation
Law or any other provision of law.
8.6 The provisions of this Section 8 shall be a contract between
the Corporation, on the one hand, and each Director and officer who serves in
such capacity at any time while this Section 8 is in effect and any other
person indemnified hereunder, on the other hand, pursuant to which the
Corporation and each such Director, officer, or other person intend to be
legally bound. No repeal or modification of this Section 8 shall affect any
rights or obligations with respect to any state of facts then or theretofore
existing or thereafter arising or any proceeding theretofore or thereafter
brought or threatened based in whole or in part upon any such state of facts.
8.7 The rights to indemnification and reimbursement or advancement
of expenses provided by, or granted pursuant to, this Section 8 shall be
enforceable by any person entitled to such indemnification or reimbursement or
advancement of expenses in any court of competent jurisdiction. The burden of
proving that such indemnification or reimbursement or advancement of expenses
is not appropriate shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) to have made a determination prior to the commencement of
such action that such indemnification or reimbursement or advancement of
expenses is proper in the circumstances nor an actual determination by the
Corporation (including its Board of Directors, its independent legal counsel
and its stockholders) that such
-4-
<PAGE> 5
person is not entitled to such indemnification or reimbursement or advancement
of expenses shall constitute a defense to the action or create a presumption
that such person is not so entitled. Such a person shall also be indemnified
for any expenses incurred in connection with successfully establishing his or
her right to such indemnification or reimbursement or advancement of expenses,
in whole or in part, in any such proceeding.
8.8 Any Director or officer of the Corporation serving in any
capacity (a) another corporation of which a majority of the shares entitled to
vote in the election of its directors is held, directly or indirectly, by the
Corporation or (b) any employee benefit plan of the Corporation or any
corporation referred to in clause (a) shall be deemed to be doing so at the
request of the Corporation.
8.9 Any person entitled to be indemnified or to reimbursement or
advancement of expenses as a matter of right pursuant to this Section 8 may
elect to have the right to indemnification or reimbursement or advancement of
expenses interpreted on the basis of the applicable law in effect at the time
of the occurrence of the event or events giving rise to the applicable
Proceeding, to the extent permitted by law, or on the basis of the applicable
law in effect at the time such indemnification or reimbursement or advance of
expenses is sought. Such election shall be made, by a notice in writing to the
Corporation, at the time indemnification or reimbursement or advancement of
expenses is sought; provided, however, that if no such notice is given, the
right to indemnification or reimbursement or advancement of expenses shall be
determined by the law in effect at the time indemnification or reimbursement of
advancement of expenses is sought.
9. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original By-laws) make, alter or repeal the By-laws by a vote of two-thirds of
the entire Board of Directors that would be in office if no vacancy existed,
whether or not present at a meeting; provided, however, that any By-laws made,
amended or repealed by the Board of Directors may be amended or repealed, and
any By- laws may be made,
-5-
<PAGE> 6
by the stockholders of the Corporation by a vote of a majority of the holders
of shares of stock of the Corporation entitled to vote in the election of
Directors of the Corporation.
WITNESS the signature of this Certificate this 22nd of October, 1993.
/s/ Heather S. McDonnell
--------------------------------
Heather S. McDonnell
Incorporator
-6-
<PAGE> 1
EXHIBIT 3.33
CERTIFICATE OF INCORPORATION
OF
WAITE BROADCASTING CORP.
1. The name of the corporation is Waite Broadcasting Corp.
2. The address of its registered office is the State of Delaware
is 1209 Orange Street in the City of Wilmington, County of New Castle. The
name of its registered agent at such address is The Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is:
To engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of
Delaware,
4. The total number of shares of stock which the corporation
shall have authority to issue is One Hundred Ten Thousand (110,000) of which
Ten Thousand shares of the par value of One Dollar ($1.00) each, amounting in
the aggregate to Ten Thousand Dollars ($10,000) shall be preferred stock and of
which One Hundred Thousand (100,000) shares of the par value of one cent ($.01)
each accounting is the aggregate to One Thousand Dollars ($1,000) shall be
common stock.
5. The Board of Directors of the corporation is authorized to
issue the Preferred Stock of the corporation from time to time in one or more
series with distinctive serial designations:
(a) with voting powers, full or limited, or no voting
powers, and such designations, preferences and
relative, participating, option or other special
rights, and qualifications, limitations, or
restrictions;
(b) subject, or not subject to, redemption at such time
or times and at such price or prices;
(c) with the right to receive dividends at such rates, on
such conditions and at such times, and payable in
preference to, or in such relations to, the dividends
payable on any other class or classes or any other
series of stock and cumulative or noncumulative as;
(d) with the rights, upon the dissolution of, or upon
distribution of the assets of the corporation; and
<PAGE> 2
(e) convertible into, or exchangeable for any other class
or classes of stock or any series thereof, of the
corporation at such price or prices or at such rates
of exchange with such adjustments;
as shall be stated in the resolution or resolutions provided for the issue of
such stock adopted by the Board of Directors. Preferred Stock shall not have
any vote except as required by law or as provided in the resolution or
resolutions of the Board of Directors of the corporation delineating the rights
and liabilities of the class or series.
6. The name and mailing address of the incorporator is as
follows:
NAME MAILING ADDRESS
---- ---------------
Martin Mushkin Blodnick, Schultz & Abramowitz, P.C.
3111 New Hyde Park Road
Lake Success, New York 11042
7. The corporation is to have perpetual existence.
8. In furtherance and not in limitation of the powers conferred
by statute, the board of directors is expressly authorized to make, alter or
repeal the by-laws of the corporation.
9. The corporation reserves the right to amend, alter, change or
repeat any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
10. Any and all right, title, interest and claim in or to any
dividends declared by the corporation, whether in cash, stock, or otherwise,
which are unclaimed by the stockholder entitled thereto for a period of six
years after the close of business on the payments date, shall be deemed to be
extinguished and abandoned; any such unclaimed dividends in the possession of
the corporation, its transfer agents, or other agents or depositories, shall at
such time become the absolute property of the corporation, free and clear of
any and all claims of any persons whatsoever.
11. The corporations shall, to the fullest extent permitted by
Section 145 of the General Corporation Law of the State of Delaware, as the
same may be amended and supplemented, indemnify any and all persons whom it
shall have power to indemnify under said section from and against any and all
of the expenses, liabilities or other matters referred to in or covered by said
section, and the indemnification provided for herein shall not be deemed
exclusive of any other rights to which those indemnified may be entitled under
any By-Law, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in any
other capacity while holding such office, and shall continue as to a person who
has ceased to be director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.
-2-
<PAGE> 3
I, THE UNDERSIGNED being the sole incorporator hereinbefore named, for
the purpose of forming a corporation pursuant to the General Corporation Law of
the State of Delaware, do make this Certificate hereby declaring and certifying
that this is my act and deed and the facts herein stated are true, and
accordingly, have hereunto set my hand this 2nd day of August, 1985.
/s/ Martin Mushkin
-----------------------------
MUSHKIN
-3-
<PAGE> 4
CERTIFICATE OF CHANGE OF LOCATION OF REGISTERED OFFICE
AND OF REGISTERED AGENT
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"corporation") is
WAITE BROADCASTING CORP.
2. The registered office of the corporation within the State of
Delaware is hereby changed to 32 Loockerman Square, Suite L-100, City of Dover
19901, County of Kent.
3. The registered agent of the corporation within the State of
Delaware is hereby changed to The Prentice- Hall Corporation System, Inc., the
business office of which is identical with the registered office of the
corporation as hereby changed.
4. The corporation has authorized the changes hereinbefore set
forth by resolution of its Board of Directors.
SIGNED on November 2, 1992.
/s/ Frank D. Osborn
-------------------------------------
Frank D. Osborn, President
Attest:
/s/ Josephine Osborn
- -------------------------------
Josephine Osborn, Secretary
<PAGE> 1
EXHIBIT 3.34
CERTIFICATE OF INCORPORATION
of
YELLOW BRICK RADIO CORPORATION
The undersigned incorporator, in order to form a corporation under the
General Corporation Law of the State of Delaware, certifies as follow:
1. Name. The name of the corporation is Yellow Brick Radio
Corporation (hereinafter called the "Corporation").
2. Address; Registered Agent. The address of the Corporation's
registered office is 229 South State Street, City of Dover, County of Kent,
State of Delaware; and its registered agent at such address is United States
Corporation Company.
3. Purposes. The nature of the business and purposes to be
conducted or promoted by the Corporation are to engage in, carry on and conduct
any lawful act or activity for which corporations may be organized under the
General Corporation Law of Delaware.
4. Number of Shares. The total number of shares of stock which
the Corporation shall have authority to issue is: one thousand (1,000), all of
which shall be shares of Common Stock of the par value of one cent ($.01) each.
5. Name and Address of Incorporator. The name and mailing
address of the incorporator are:
Laurence W. Bates
c/o Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, New York 10019
6. Election of Directors. Members of the Board of Directors may
be elected either by written ballot or by voice vote.
<PAGE> 2
7. Limitation of Liability. No director of the Corporation shall
be personally liable to the Corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, except for liability (i)
for any breach of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the Delaware General Corporation Law, or (iv) for any transaction from which
the director derived any improper personal benefits.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a director of the Corporation existing at the time of such repeal
or modification.
8. Adoption, Amendment and/or Repeal of By-Laws. The Board of
Directors may from time to time (after adoption by the undersigned of the
original by-laws of the Corporation) make, alter or repeal the by-laws of the
Corporation; provided, that any by-laws made, amended or repealed by the Board
of Directors may be amended or repealed, and any by-laws may be made, by the
stockholders of the Corporation.
IN WITNESS WHEREOF, this Certificate has been signed on this 26th day
of March, 1987.
/s/ Lawrence W. Bates
--------------------------------
Lawrence W. Bates, Incorporator
-2-
<PAGE> 1
EXHIBIT 3.35
CERTIFICATE OF INCORPORATION
OF
AMERON BROADCASTING CORPORATION
FIRST: The name of the corporation is Ameron Broadcasting
Corporation.
SECOND: The address of its registered office in the State of Delaware
is Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801 in
New Castle County, Delaware. The name of its registered agent at such address
is The Corporation Trust Company.
THIRD: The nature of the business or purposes to be conducted or
promoted by the corporation is to engage in any lawful act or activity for
which corporations may be organized under the Delaware General Corporation Law.
FOURTH: The total number of shares of all classes of stock which the
corporation shall have authority to issue is Three Thousand (3,000) shares of
Common Stock of the par value of One Cent ($0.01) per share.
FIFTH: The name of the incorporator is P. Gregory Hidalgo and his
mailing address is c/o Vinson & Elkins L.L.P., 3700 Trammell Crow Center, 2001
Ross Avenue, Dallas, Texas 75201.
SIXTH: The name and mailing address of the sole director, who shall
serve until the first annual meeting of stockholders or until his successor is
elected and qualified, is as follows:
Name Address
Eric C. Neuman 200 Crescent Court, Suite 1600
Dallas, Texas 75201
The number of directors of the corporation shall be as specified in, or
determined in the manner provided in, the bylaws. Election of directors need
not be by written ballot.
<PAGE> 2
SEVENTH: In furtherance of, and not in limitation of, the powers
conferred by statute, the Board of Directors is expressly authorized to adopt,
amend or repeal the bylaws of the corporation.
EIGHTH: Whenever a compromise or arrangement is proposed between the
corporation and its creditors or any class of them and/or between the
corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of the corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for the corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers
appointed for the corporation under the provisions of Section 279 of Title 8 of
the Delaware Code order a meeting of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of the corporation, as the
case may be, to be summoned in such manner as the said court directs. If a
majority in number representing three-fourths in value of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of the
corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of the corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of the corporation, as the case may be,
and also on the corporation.
NINTH: No director of the corporation shall be liable to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware General
Corporation Law, or (iv) for any transaction from which the director derived an
improper personal benefit. In addition to the circumstances in which a
director of
2
<PAGE> 3
the corporation is not personally liable as set forth in the preceding
sentence, a director of the corporation shall not be liable to the fullest
extent permitted by any amendment to the Delaware General Corporation Law
hereafter enacted that further limits the liability of a director.
TENTH: The corporation shall have the right, subject to any express
provisions or restrictions contained in this certificate of incorporation or
bylaws of the corporation, from time to time, to amend this certificate of
incorporation or any provision hereof in any manner now or hereafter provided
by law, and all rights and powers of any kind conferred upon a director or
stockholder of this corporation by this certificate of incorporation or any
amendment hereof are subject to such right of the corporation.
I, the undersigned, being the incorporator hereinbefore named, for the
purpose of forming a corporation pursuant to the Delaware General Corporation
Law, do make this certificate, hereby declaring that this is my act and deed
and that the facts herein stated are true, and accordingly have hereunto set my
hand this 27th day of February, 1997.
/s/ P. Gregory Hidalgo
------------------------------
P. Gregory Hidalgo
Incorporator
3
<PAGE> 1
EXHIBIT 3.36
CERTIFICATE OF INCORPORATION
OF
EMERALD CITY BROADCASTING CORPORATION
FIRST: The name of the corporation is Emerald City Broadcasting
Corporation.
SECOND: The address of its registered office in the State of Delaware
is Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801 in
New Castle County, Delaware. The name of its registered agent at such address
is The Corporation Trust Company.
THIRD: The nature of the business or purposes to be conducted or
promoted by the corporation is to engage in any lawful act or activity for
which corporations may be organized under the Delaware General Corporation Law.
FOURTH: The total number of shares of all classes of stock which the
corporation shall have authority to issue is Three Thousand (3,000) shares of
Common Stock of the par value of One Cent ($0.01) per share.
FIFTH: The name of the incorporator is P. Gregory Hidalgo and his
mailing address is c/o Vinson & Elkins L.L.P., 3700 Trammell Crow Center, 2001
Ross Avenue, Dallas, Texas 75201.
SIXTH: The name and mailing address of the sole director, who shall
serve until the first annual meeting of stockholders or until his successor is
elected and qualified, is as follows:
Name Address
Eric C. Neuman 200 Crescent Court, Suite 1600
Dallas, Texas 75201
The number of directors of the corporation shall be as specified in, or
determined in the manner provided in, the bylaws. Election of directors need
not be by written ballot.
1
<PAGE> 2
SEVENTH: In furtherance of, and not in limitation of, the powers
conferred by statute, the Board of Directors is expressly authorized to adopt,
amend or repeal the bylaws of the corporation.
EIGHTH: Whenever a compromise or arrangement is proposed between the
corporation and its creditors or any class of them and/or between the
corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of the corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for the corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers
appointed for the corporation under the provisions of Section 279 of Title 8 of
the Delaware Code order a meeting of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of the corporation, as the
case may be, to be summoned in such manner as the said court directs. If a
majority in number representing three-fourths in value of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of the
corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of the corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of the corporation, as the case may be,
and also on the corporation.
NINTH: No director of the corporation shall be liable to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware General
Corporation Law, or (iv) for any transaction from which the director derived an
improper personal benefit. In addition to the circumstances in which a
director of
2
<PAGE> 3
the corporation is not personally liable as set forth in the preceding
sentence, a director of the corporation shall not be liable to the fullest
extent permitted by any amendment to the Delaware General Corporation Law
hereafter enacted that further limits the liability of a director.
TENTH: The corporation shall have the right, subject to any express
provisions or restrictions contained in this certificate of incorporation or
bylaws of the corporation, from time to time, to amend this certificate of
incorporation or any provision hereof in any manner now or hereafter provided
by law, and all rights and powers of any kind conferred upon a director or
stockholder of this corporation by this certificate of incorporation or any
amendment hereof are subject to such right of the corporation.
I, the undersigned, being the incorporator hereinbefore named, for the
purpose of forming a corporation pursuant to the Delaware General Corporation
Law, do make this certificate, hereby declaring that this is my act and deed
and that the facts herein stated are true, and accordingly have hereunto set my
hand this 27th day of February, 1997.
--------------------------------------
P. Gregory Hidalgo
Incorporator
3
<PAGE> 4
CERTIFICATE OF AMENDMENT
TO
CERTIFICATE OF INCORPORATION
OF
EMERALD CITY BROADCASTING CORPORATION
(Incorporated on February 27, 1997)
(Pursuant to Section 242 of the General Corporation
Law of the State of Delaware)
- --------------------------------------------------------------------------------
Emerald City Broadcasting Corporation, a corporation organized and
existing under and by virtue of the General Corporation Law of the State of
Delaware (the "Corporation"), hereby certifies:
FIRST, that the sole director of the Corporation duly adopted a
resolution proposing and declaring advisable the following amendment to the
Certificate of Incorporation of the Corporation in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware:
RESOLVED, that the sole Director of the Corporation deems and
declares advisable an amendment to the Certificate of Incorporation of
the Corporation to amend Article One to read in its entirety as
follows; and that such amendment be submitted to the sole stockholder
of the Corporation for its consideration and approval:
FIRST: The name of the corporation is WNOK Acquisition Company, Inc.
SECOND, that in lieu of a meeting and vote of the sole stockholder,
the sole stockholder of the Corporation has given written consent to said
amendment in accordance with the provisions of Section 228(a) of the General
Corporation Law of the State of Delaware.
THIRD, that the previously stated amendment to the Certificate of
Incorporation of the Corporation was duly adopted by the sole stockholder of
the Corporation in accordance with the provisions of Section 242 and of the
General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, the undersigned has executed this Certificate this
14th day of March, 1997.
EMERALD CITY BROADCASTING CORPORATION
By: /s/ Eric C. Neuman
-----------------------------------
Eric C. Neuman, President
<PAGE> 1
EXHIBIT 3.37
BYLAWS
OF
[ADDITIONAL OSBORN REGISTRANTS]
ARTICLE I
OFFICES
Section 1. Registered Office. The registered office of the
Corporation required by the General Corporation Law of the State of Delaware to
be maintained in the State of Delaware, shall be the registered office named in
the original Certificate of Incorporation of the Corporation (as the same may
be amended and restated from time to time, the "Certificate of Incorporation"),
or such other office as may be designated from time to time by the Board of
Directors in the manner provided by law. Should the Corporation maintain a
principal office within the State of Delaware such registered office need not
be identical to such principal office of the Corporation.
Section 2. Other Offices. The Corporation may also have offices
at such other places both within and without the State of Delaware as the Board
of Directors may from time to time determine or the business of the Corporation
may require.
ARTICLE II
STOCKHOLDERS
Section 1. Place of Meetings. All meetings of the stockholders
shall be held at the principal office of the Corporation, or at such other
place within or without the State of Delaware as shall be specified or fixed in
the notices or waivers of notice thereof.
Section 2. Quorum; Adjournment of Meetings. Unless otherwise
required by law or provided in the Certificate of Incorporation or these
bylaws, the holders of a majority of the stock issued and outstanding and
entitled to vote thereat, present in person or represented by proxy, shall
constitute a quorum at any meeting of stockholders for the transaction of
business and the act of a majority of such stock so represented at any meeting
of stockholders at which a quorum is present shall constitute the act of the
meeting of stockholders. The stockholders present at a duly organized meeting
may continue to transact business until adjournment, notwithstanding the
withdrawal of enough stockholders to leave less than a quorum.
Notwithstanding the other provisions of the Certificate of
Incorporation or these bylaws, the chairman of the meeting or the holders of a
majority of the issued and outstanding stock, present in person or represented
by proxy, at any meeting of stockholders, whether or not a quorum is present,
shall have the power to adjourn such meeting from time to time, without any
notice other than announcement at the meeting of the time and place of the
holding of the adjourned meeting; provided, however, if the adjournment is for
more than 30 days, or if after the adjournment a new record date
<PAGE> 2
is fixed for the adjourned meeting, a notice of the adjourned meeting shall be
given to each stockholder of record entitled to vote at such meeting. At any
such adjourned meeting at which a quorum shall be present or represented any
business may be transacted which might have been transacted at the meeting as
originally called.
Section 3. Annual Meetings. An annual meeting of the
stockholders, for the election of directors to succeed those whose terms expire
and for the transaction of such other business as may properly come before the
meeting, shall be held at such place, within or without the State of Delaware,
on such date, and at such time as the Board of Directors shall fix and set
forth in the notice of the meeting, which date shall be within 13 months
subsequent to the later of the date of incorporation or the last annual meeting
of stockholders.
Section 4. Special Meetings. Unless otherwise provided in the
Certificate of Incorporation, special meetings of the stockholders for any
purpose or purposes may be called at any time by the Chairman of the Board (if
any), by the President or by a majority of the Board of Directors, or by a
majority of the executive committee (if any), and shall be called by the
Chairman of the Board (if any), by the President or the Secretary upon the
written request therefor, stating the purpose or purposes of the meeting,
delivered to such officer, signed by the holder(s) of at least l0% of the
issued and outstanding stock entitled to vote at such meeting.
Section 5. Record Date. For the purpose of determining
stockholders entitled to notice of or to vote at any meeting of stockholders,
or any adjournment thereof, or entitled to express consent to corporate action
in writing without a meeting, or entitled to receive payment of any dividend or
other distribution or allotment of any rights, or entitled to exercise any
rights in respect of any change, conversion or exchange of stock or for the
purpose of any other lawful action, the Board of Directors of the Corporation
may fix, in advance, a date as the record date for any such determination of
stockholders, which date shall not be more than 60 days nor less than l0 days
before the date of such meeting, nor more than 60 days prior to any other
action.
If the Board of Directors does not fix a record date for any meeting
of the stockholders, the record date for determining stockholders entitled to
notice of or to vote at such meeting shall be at the close of business on the
day next preceding the day on which notice is given, or, if in accordance with
Article VIII, Section 3 of these bylaws notice is waived, at the close of
business on the day next preceding the day on which the meeting is held. If,
in accordance with Section 12 of this Article II, corporate action without a
meeting of stockholders is to be taken, the record date for determining
stockholders entitled to express consent to such corporate action in writing,
when no prior action by the Board of Directors is necessary, shall be the day
on which the first written consent is expressed. The record date for
determining stockholders for any other purpose shall be at the close of
business on the day on which the Board of Directors adopts the resolution
relating thereto.
A determination of stockholders of record entitled to notice of or to
vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.
Section 6. Notice of Meetings. Written notice of the place,
date and hour of all meetings, and, in case of a special meeting, the purpose
or purposes for which the meeting is called, shall be given by or at the
direction of the Chairman of the Board (if any) or the President, the Secretary
or the
<PAGE> 3
other person(s) calling the meeting to each stockholder entitled to vote
thereat not less than 10 nor more than 60 days before the date of the meeting.
Such notice may be delivered either personally or by mail. If mailed, notice
is given when deposited in the United States mail, postage prepaid, directed to
the stockholder at his address as it appears on the records of the Corporation.
Section 7. Stock List. A complete list of stockholders entitled
to vote at any meeting of stockholders, arranged in alphabetical order for each
class of stock and showing the address of each such stockholder and the number
of shares registered in the name of such stockholder, shall be open to the
examination of any stockholder, for any purpose germane to the meeting, during
ordinary business hours, for a period of at least 10 days prior to the meeting,
either at a place within the city where the meeting is to be held, which place
shall be specified in the notice of the meeting, or if not so specified, at the
place where the meeting is to be held. The stock list shall also be produced
and kept at the time and place of the meeting during the whole time thereof,
and may be inspected by any stockholder who is present.
Section 8. Proxies. Each stockholder entitled to vote at a
meeting of stockholders or to express consent or dissent to a corporate action
in writing without a meeting may authorize another person or persons to act for
him by proxy. Proxies for use at any meeting of stockholders shall be filed
with the Secretary, or such other officer as the Board of Directors may from
time to time determine by resolution, before or at the time of the meeting.
All proxies shall be received and taken charge of and all ballots shall be
received and canvassed by the secretary of the meeting who shall decide all
questions touching upon the qualification of voters, the validity of the
proxies, and the acceptance or rejection of votes, unless an inspector or
inspectors shall have been appointed by the chairman of the meeting, in which
event such inspector or inspectors shall decide all such questions.
No proxy shall be valid after three years from its date, unless the
proxy provides for a longer period. Each proxy shall be revocable unless
expressly provided therein to be irrevocable and coupled with an interest
sufficient in law to support an irrevocable power.
Should a proxy designate two or more persons to act as proxies, unless
such instrument shall provide the contrary, a majority of such persons present
at any meeting at which their powers thereunder are to be exercised shall have
and may exercise all the powers of voting or giving consents thereby conferred,
or if only one be present, then such powers may be exercised by that one; or,
if an even number attend and a majority do not agree on any particular issue,
each proxy so attending shall be entitled to exercise such powers in respect of
the same portion of the shares as he is of the proxies representing such
shares.
Section 9. Voting; Elections; Inspectors. Unless otherwise
required by law or provided in the Certificate of Incorporation, each
stockholder shall have one vote for each share of stock entitled to vote which
is registered in his name on the record date for the meeting. Shares
registered in the name of another corporation, domestic or foreign, may be
voted by such officer, agent or proxy as the bylaws (or comparable instrument)
of such corporation may prescribe, or in the absence of such provision, as the
Board of Directors (or comparable body) of such corporation may determine.
Shares registered in the name of a deceased person may be voted by his executor
or administrator, either in person or by proxy.
All voting, except as required by the Certificate of Incorporation or
where otherwise required by law, may be by a voice vote; provided, however,
that upon demand therefor by stockholders
<PAGE> 4
holding a majority of the issued and outstanding stock present in person or by
proxy at any meeting a stock vote shall be taken. Every stock vote shall be
taken by written ballots, each of which shall state the name of the stockholder
or proxy voting and such other information as may be required under the
procedure established for the meeting. All elections of directors shall be by
ballot, unless otherwise provided in the Certificate of Incorporation.
At any meeting at which a vote is taken by ballots, the chairman of
the meeting may appoint one or more inspectors, each of whom shall subscribe an
oath or affirmation to execute faithfully the duties of inspector at such
meeting with strict impartiality and according to the best of his ability.
Such inspector shall receive the ballots, count the votes and make and sign a
certificate of the result thereof. The chairman of the meeting may appoint any
person to serve as inspector, except no candidate for the office of director
shall be appointed as an inspector.
Unless otherwise provided in the Certificate of Incorporation,
cumulative voting for the election of directors shall be prohibited.
Section 10. Conduct of Meetings. The meetings of the
stockholders shall be presided over by the Chairman of the Board (if any), or
if he is not present, by the President, or if neither the Chairman of the Board
(if any), nor President is present, by a chairman elected at the meeting. The
Secretary of the Corporation, if present, shall act as secretary of such
meetings, or if he is not present, an Assistant Secretary shall so act; if
neither the Secretary nor an Assistant Secretary is present, then a secretary
shall be appointed by the chairman of the meeting. The chairman of any meeting
of stockholders shall determine the order of business and the procedure at the
meeting, including such regulation of the manner of voting and the conduct of
discussion as seem to him in order. Unless the chairman of the meeting of
stockholders shall otherwise determine, the order of business shall be as
follows:
(a) calling of meeting to order;
(b) election of a chairman and the appointment of a secretary if
necessary;
(c) presentation of proof of the due calling of the meeting;
(d) presentation and examination of proxies and determination of a
quorum;
(e) reading and settlement of the minutes of the previous meeting;
(f) reports of officers and committees;
(g) the election of directors if an annual meeting, or a meeting
called for that purpose;
(h) unfinished business;
(i) new business; and
(j) adjournment.
Section 11. Treasury Stock. The Corporation shall not vote,
directly or indirectly, shares of its own stock owned by it and such shares
shall not be counted for quorum purposes.
Section 12. Action Without Meeting. Unless otherwise provided in
the Certificate of Incorporation, any action permitted or required by law, the
Certificate of Incorporation or these bylaws to be taken at a meeting of
stockholders, may be taken without a meeting, without prior notice and without
a vote, if a consent in writing, setting forth the action so taken, shall be
signed by the holders of outstanding stock having not less than the minimum
number of votes that would be necessary to authorize or take such action at a
meeting at which all shares entitled to vote thereon were present and
<PAGE> 5
voted. Prompt notice of the taking of the corporate action without a meeting
by less than a unanimous written consent shall be given by the Secretary to
those stockholders who have not consented in writing.
ARTICLE III
BOARD OF DIRECTORS
Section 1. Power; Number; Term of Office. The business and
affairs of the Corporation shall be managed by or under the direction of the
Board of Directors, and subject to the restrictions imposed by law or the
Certificate of Incorporation, they may exercise all the powers of the
Corporation.
Unless otherwise provided in the Certificate of Incorporation, the
number of directors that shall constitute the entire Board of Directors shall
be determined from time to time by resolution of the Board of Directors
(provided that no decrease in the number of directors that would have the
effect of shortening the term of an incumbent director may be made by the Board
of Directors). If the Board of Directors makes no such determination, the
number of directors shall be the number set forth in the Certificate of
Incorporation as the number of directors constituting the initial Board of
Directors. Each director shall hold office for the term for which he is
elected and thereafter until his successor shall have been elected and
qualified, or until his earlier death, resignation or removal.
Unless otherwise provided in the Certificate of Incorporation,
directors need not be stockholders nor residents of the State of Delaware.
Section 2. Quorum. Unless otherwise provided in the Certificate
of Incorporation, a majority of the total number of directors shall constitute
a quorum for the transaction of business of the Board of Directors and the vote
of a majority of the directors present at a meeting at which a quorum is
present shall be the act of the Board of Directors.
Section 3. Place of Meetings; Order of Business. The directors
may hold their meetings and may have an office and keep the books of the
Corporation, except as otherwise provided by law, in such place or places,
within or without the State of Delaware, as the Board of Directors may from
time to time determine by resolution. At all meetings of the Board of
Directors business shall be transacted in such order as shall from time to time
be determined by the Chairman of the Board (if any), or in his absence by the
President, or by resolution of the Board of Directors.
Section 4. First Meeting. Each newly elected Board of Directors
may hold its first meeting for the purpose of organization and the transaction
of business, if a quorum is present, immediately after and at the same place as
the annual meeting of the stockholders. Notice of such meeting shall not be
required. At the first meeting of the Board of Directors in each year at which
a quorum shall be present, held next after the annual meeting of stockholders,
the Board of Directors shall proceed to the election of the officers of the
Corporation.
<PAGE> 6
Section 5. Regular Meetings. Regular meetings of the Board of
Directors shall be held at such times and places as shall be designated from
time to time by resolution of the Board of Directors. Notice of such regular
meetings shall not be required.
Section 6. Special Meetings. Special meetings of the Board of
Directors may be called by the Chairman of the Board (if any), the President
or, on the written request of any two directors, by the Secretary, in each case
on at least 24-hours personal, written, telegraphic, cable or wireless notice
to each director. Such notice, or any waiver thereof pursuant to Article
VIII, Section 3 hereof, need not state the purpose or purposes of such meeting,
except as may otherwise be required by law or provided for in the Certificate
of Incorporation or these bylaws.
Section 7. Removal. Any director or the entire Board of
Directors may be removed, with or without cause, by the holders of a majority
of the shares then entitled to vote at an election of directors; provided that,
unless the Certificate of Incorporation otherwise provides, if the Board of
Directors is classified, then the stockholders may effect such removal only for
cause; and provided further that, if the Certificate of Incorporation expressly
grants to stockholders the right to cumulate votes for the election of
directors and if less than the entire board is to be removed, no director may
be removed without cause if the votes cast against his removal would be
sufficient to elect him if then cumulatively voted at an election of the entire
Board of Directors, or, if there be classes of directors, at an election of the
class of directors of which such director is a part.
Section 8. Vacancies; Increases in the Number of Directors.
Unless otherwise provided in the Certificate of Incorporation, vacancies and
newly created directorships resulting from any increase in the authorized
number of directors may be filled by a majority of the directors then in
office, although less than a quorum, or a sole remaining director; and any
director so chosen shall hold office until the next annual election and until
his successor shall be duly elected and shall qualify, unless sooner displaced.
If the directors of the Corporation are divided into classes, any
directors elected to fill vacancies or newly created directorships shall hold
office until the next election of the class for which such directors shall have
been chosen, and until their successors shall be duly elected and shall
qualify.
Section 9. Compensation. Unless otherwise restricted by the
Certificate of Incorporation, the Board of Directors shall have the authority
to fix the compensation of directors.
Section 10. Action Without a Meeting; Telephone Conference
Meeting. Unless otherwise restricted by the Certificate of Incorporation, any
action required or permitted to be taken at any meeting of the Board of
Directors, or any committee designated by the Board of Directors, may be taken
without a meeting if all members of the Board of Directors or committee, as the
case may be consent thereto in writing, and the writing or writings are filed
with the minutes of proceedings of the Board of Directors or committee. Such
consent shall have the same force and effect as a unanimous vote at a meeting,
and may be stated as such in any document or instrument filed with the
Secretary of State of Delaware.
Unless otherwise restricted by the Certificate of Incorporation,
subject to the requirement for notice of meetings, members of the Board of
Directors, or members of any committee designated by the Board of Directors,
may participate in a meeting of such Board of Directors or committee, as the
<PAGE> 7
case may be, by means of a conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and participation in such a meeting shall constitute presence in
person at such meeting, except where a person participates in the meeting for
the express purpose of objecting to the transaction of any business on the
ground that the meeting is not lawfully called or convened.
Section 11. Approval or Ratification of Acts or Contracts by
Stockholders. The Board of Directors in its discretion may submit any act or
contract for approval or ratification at any annual meeting of the
stockholders, or at any special meeting of the stockholders called for the
purpose of considering any such act or contract, and any act or contract that
shall be approved or be ratified by the vote of the stockholders holding a
majority of the issued and outstanding shares of stock of the Corporation
entitled to vote and present in person or by proxy at such meeting (provided
that a quorum is present), shall be as valid and as binding upon the
Corporation and upon all the stockholders as if it has been approved or
ratified by every stockholder of the Corporation. In addition, any such act or
contract may be approved or ratified by the written consent of stockholders
holding a majority of the issued and outstanding shares of capital stock of the
Corporation entitled to vote and such consent shall be as valid and as binding
upon the Corporation and upon all the stockholders as if it had been approved
or ratified by every stockholder of the Corporation.
ARTICLE IV
COMMITTEES
Section 1. Designation; Powers. The Board of Directors may, by
resolution passed by a majority of the whole board, designate one or more
committees, including, if they shall so determine, an executive committee, each
such committee to consist of one or more of the directors of the Corporation.
Any such designated committee shall have and may exercise such of the powers
and authority of the Board of Directors in the management of the business and
affairs of the Corporation as may be provided in such resolution, except that
no such committee shall have the power or authority of the Board of Directors
in reference to amending the Certificate of Incorporation, adopting an
agreement of merger or consolidation, recommending to the stockholders the
sale, lease or exchange of all or substantially all of the Corporation's
property and assets, recommending to the stockholders a dissolution of the
Corporation or a revocation of a dissolution of the Corporation, or amending,
altering or repealing the bylaws or adopting new bylaws for the Corporation
and, unless such resolution or the Certificate of Incorporation expressly so
provides, no such committee shall have the power or authority to declare a
dividend or to authorize the issuance of stock. Any such designated committee
may authorize the seal of the Corporation to be affixed to all papers which may
require it. In addition to the above such committee or committees shall have
such other powers and limitations of authority as may be determined from time
to time by resolution adopted by the Board of Directors.
Section 2. Procedure; Meetings; Quorum. Any committee
designated pursuant to Section 1 of this Article shall choose its own chairman,
shall keep regular minutes of its proceedings and report the same to the Board
of Directors when requested, shall fix its own rules or procedures, and shall
meet at such times and at such place or places as may be provided by such
rules, or by resolution of such committee or resolution of the Board of
Directors. At every meeting of any such committee, the presence of a majority
of all the members thereof shall constitute a quorum and the
<PAGE> 8
affirmative vote of a majority of the members present shall be necessary for
the adoption by it of any resolution.
Section 3. Substitution of Members. The Board of Directors may
designate one or more directors as alternate members of any committee, who may
replace any absent or disqualified member at any meeting of such committee. In
the absence or disqualification of a member of a committee, the member or
members present at any meeting and not disqualified from voting, whether or not
constituting a quorum, may unanimously appoint another member of the Board of
Directors to act at the meeting in the place of the absent or disqualified
member.
ARTICLE V
OFFICERS
Section 1. Number, Titles and Term of Office. The officers of
the Corporation shall be a President, one or more Vice Presidents (any one or
more of whom may be designated Executive Vice President or Senior Vice
President), a Treasurer, a Secretary and, if the Board of Directors so elects,
a Chairman of the Board and such other officers as the Board of Directors may
from time to time elect or appoint. Each officer shall hold office until his
successor shall be duly elected and shall qualify or until his death or until
he shall resign or shall have been removed in the manner hereinafter provided.
Any number of offices may be held by the same person, unless the Certificate of
Incorporation provides otherwise. Except for the Chairman of the Board, if
any, no officer need be a director.
Section 2. Salaries. The salaries or other compensation of the
officers and agents of the Corporation shall be fixed from time to time by the
Board of Directors.
Section 3. Removal. Any officer or agent elected or appointed
by the Board of Directors may be removed, either with or without cause, by the
vote of a majority of the whole Board of Directors at a special meeting called
for the purpose, or at any regular meeting of the Board of Directors, provided
the notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
Section 4. Vacancies. Any vacancy occurring in any office of
the Corporation may be filled by the Board of Directors.
Section 5. Powers and Duties of the Chief Executive Officer.
The President shall be the chief executive officer of the Corporation unless
the Board of Directors designates the Chairman of the Board as chief executive
officer. Subject to the control of the Board of Directors and the executive
committee (if any), the chief executive officer shall have general executive
charge, management and control of the properties, business and operations of
the Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
and shall have such other powers and duties
<PAGE> 9
as designated in accordance with these bylaws and as from time to time may be
assigned to him by the Board of Directors.
Section 6. Powers and Duties of the Chairman of the Board. If
elected, the Chairman of the Board shall preside at all meetings of the
stockholders and of the Board of Directors; and he shall have such other powers
and duties as designated in these bylaws and as from time to time may be
assigned to him by the Board of Directors.
Section 7. Powers and Duties of the President. Unless the Board
of Directors otherwise determines, the President shall have the authority to
agree upon and execute all leases, contracts, evidences of indebtedness and
other obligations in the name of the Corporation; and, unless the Board of
Directors otherwise determines, he shall, in the absence of the Chairman of the
Board or if there be no Chairman of the Board, preside at all meetings of the
stockholders and (should he be a director) of the Board of Directors; and he
shall have such other powers and duties as designated in accordance with these
bylaws and as from time to time may be assigned to him by the Board of
Directors.
Section 8. Vice Presidents. In the absence of the President, or
in the event of his inability or refusal to act, a Vice President designated by
the Board of Directors shall perform the duties of the President, and when so
acting shall have all the powers of and be subject to all the restrictions upon
the President. In the absence of a designation by the Board of Directors of a
Vice President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
Section 9. Treasurer. The Treasurer shall have responsibility
for the custody and control of all the funds and securities of the Corporation,
and he shall have such other powers and duties as designated in these bylaws
and as from time to time may be assigned to him by the Board of Directors. He
shall perform all acts incident to the position of Treasurer, subject to the
control of the chief executive officer and the Board of Directors; and he
shall, if required by the Board of Directors, give such bond for the faithful
discharge of his duties in such form as the Board of Directors may require.
Section 10. Assistant Treasurers. Each Assistant Treasurer shall
have the usual powers and duties pertaining to his office, together with such
other powers and duties as designated in these bylaws and as from time to time
may be assigned to him by the chief executive officer or the Board of
Directors. The Assistant Treasurers shall exercise the powers of the Treasurer
during that officer's absence or inability or refusal to act.
Section 11. Secretary. The Secretary shall keep the minutes of
all meetings of the Board of Directors, committees of directors and the
stockholders, in books provided for that purpose; he shall attend to the giving
and serving of all notices; he may in the name of the Corporation affix the
seal of the Corporation to all contracts of the Corporation and attest the
affixation of the seal of the Corporation thereto; he may sign with the other
appointed officers all certificates for shares of capital stock of the
Corporation; he shall have charge of the certificate books, transfer books and
stock ledgers, and such other books and papers as the Board of Directors may
direct, all of which shall at all reasonable times be open to inspection of any
director upon application at the office of the Corporation
<PAGE> 10
during business hours; he shall have such other powers and duties as designated
in these bylaws and as from time to time may be assigned to him by the Board of
Directors; and he shall in general perform all acts incident to the office of
Secretary, subject to the control of the chief executive officer and the Board
of Directors.
Section 12. Assistant Secretaries. Each Assistant Secretary
shall have the usual powers and duties pertaining to his office, together with
such other powers and duties as designated in these bylaws and as from time to
time may be assigned to him by the chief executive officer or the Board of
Directors. The Assistant Secretaries shall exercise the powers of the
Secretary during that officer's absence or inability or refusal to act.
Section 13. Action with Respect to Securities of Other
Corporations. Unless otherwise directed by the Board of Directors, the chief
executive officer shall have power to vote and otherwise act on behalf of the
Corporation, in person or by proxy, at any meeting of security holders of or
with respect to any action of security holders of any other corporation in
which this Corporation may hold securities and otherwise to exercise any and
all rights and powers which this Corporation may possess by reason of its
ownership of securities in such other corporation.
ARTICLE VI
INDEMNIFICATION OF DIRECTORS,
OFFICERS, EMPLOYEES AND AGENTS
Section 1. Right to Indemnification. Each person who was or is
made a party or is threatened to be made a party to or is involved in any
action, suit or proceeding, whether civil, criminal, administrative or
investigative (hereinafter a "proceeding"), by reason of the fact that he or
she or a person of whom he or she is the legal representative, is or was or has
agreed to become a director or officer of the Corporation or is or was serving
or has agreed to serve at the request of the Corporation as a director,
officer, employee or agent of another corporation or of a partnership, joint
venture, trust or other enterprise, including service with respect to employee
benefit plans, whether the basis of such proceeding is alleged action in an
official capacity as a director or officer or in any other capacity while
serving or having agreed to serve as a director or officer, shall be
indemnified and held harmless by the Corporation to the fullest extent
authorized by the Delaware General Corporation Law, as the same exists or may
hereafter be amended, (but, in the case of any such amendment, only to the
extent that such amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation to provide prior
to such amendment) against all expense, liability and loss (including without
limitation, attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid or to be paid in settlement) reasonably incurred or suffered
by such person in connection therewith and such indemnification shall continue
as to a person who has ceased to serve in the capacity which initially entitled
such person to indemnity hereunder and shall inure to the benefit of his or her
heirs, executors and administrators; provided, however, that the Corporation
shall indemnify any such person seeking indemnification in connection with a
proceeding (or part thereof), other than a proceeding (or part thereof) brought
under Section 3 of this Article VI, initiated by such person or his or her
heirs, executors and administrators only if such proceeding (or part thereof)
was authorized by the board of directors of the Corporation. The right to
indemnification conferred in this Article VI shall be a contract right and
shall include the right to be paid by the Corporation the
<PAGE> 11
expenses incurred in defending any such proceeding in advance of its final
disposition; provided, however, that, if the Delaware General Corporation Law
requires, the payment of such expenses incurred by a current, former or
proposed director or officer in his or her capacity as a director or officer or
proposed director or officer (and not in any other capacity in which service
was or is or has been agreed to be rendered by such person while a director or
officer, including, without limitation, service to an employee benefit plan) in
advance of the final disposition of a proceeding, shall be made only upon
delivery to the Corporation of an undertaking, by or on behalf of such
indemnified person, to repay all amounts so advanced if it shall ultimately be
determined that such indemnified person is not entitled to be indemnified under
this Section or otherwise.
Section 2. Indemnification of Employees and Agents. The
Corporation may, by action of its Board of Directors, provide indemnification
to employees and agents of the Corporation, individually or as a group, with
the same scope and effect as the indemnification of directors and officers
provided for in this Article.
Section 3. Right of Claimant to Bring Suit. If a written claim
received by the Corporation from or on behalf of an indemnified party under
this Article VI is not paid in full by the Corporation within ninety days after
such receipt, the claimant may at any time thereafter bring suit against the
Corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the claimant shall be entitled to be paid also the expense of
prosecuting such claim. It shall be a defense to any such action (other than
an action brought to enforce a claim for expenses incurred in defending any
proceeding in advance of its final disposition where the required undertaking,
if any is required, has been tendered to the Corporation) that the claimant has
not met the standards of conduct which make it permissible under the Delaware
General Corporation Law for the Corporation to indemnify the claimant for the
amount claimed, but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware General Corporation
Law, nor an actual determination by the Corporation (including its Board of
Directors, independent legal counsel, or its stockholders) that the claimant
has not met such applicable standard of conduct, shall be a defense to the
action or create a presumption that the claimant has not met the applicable
standard of conduct.
Section 4. Nonexclusivity of Rights. The right to
indemnification and the advancement and payment of expenses conferred in this
Article VI shall not be exclusive of any other right which any person may have
or hereafter acquire under any law (common or statutory), provision of the
Certificate of Incorporation of the Corporation, bylaw, agreement, vote of
stockholders or disinterested directors or otherwise.
Section 5. Insurance. The Corporation may maintain insurance,
at its expense, to protect itself and any person who is or was serving as a
director, officer, employee or agent of the Corporation or is or was serving at
the request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against any expense, liability or loss, whether or not the Corporation would
have the power to indemnify such person against such expense, liability or loss
under the Delaware General Corporation Law.
<PAGE> 12
Section 6. Savings Clause. If this Article VI or any portion
hereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Corporation shall nevertheless indemnify and hold
harmless each director and officer of the Corporation, as to costs, charges and
expenses (including attorneys' fees), judgments, fines, and amounts paid in
settlement with respect to any action, suit or proceeding, whether civil,
criminal, administrative or investigative to the full extent permitted by any
applicable portion of this Article VI that shall not have been invalidated and
to the fullest extent permitted by applicable law.
Section 7. Definitions. For purposes of this Article, reference
to the "Corporation" shall include, in addition to the Corporation, any
constituent corporation (including any constituent of a constituent) absorbed
in a consolidation or merger prior to (or, in the case of an entity
specifically designated in a resolution of the Board of Directors, after) the
adoption hereof and which, if its separate existence had continued, would have
had the power and authority to indemnify its directors, officers and employees
or agents, so that any person who is or was a director, officer, employee or
agent of such constituent corporation, or is or was serving at the request of
such constituent corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
shall stand in the same position under the provisions of this Article with
respect to the resulting or surviving corporation as he would have with respect
to such constituent corporation if its separate existence had continued.
ARTICLE VII
CAPITAL STOCK
Section 1. Certificates of Stock. The certificates for shares
of the capital stock of the Corporation shall be in such form, not inconsistent
with that required by law and the Certificate of Incorporation, as shall be
approved by the Board of Directors. The Chairman of the Board (if any),
President or a Vice President shall cause to be issued to each stockholder one
or more certificates, under the seal of the Corporation or a facsimile thereof
if the Board of Directors shall have provided for such seal, and signed by the
Chairman of the Board (if any), President or a Vice President and the Secretary
or an Assistant Secretary or the Treasurer or an Assistant Treasurer certifying
the number of shares (and, if the stock of the Corporation shall be divided
into classes or series, the class and series of such shares) owned by such
stockholder in the Corporation; provided, however, that any of or all the
signatures on the certificate may be facsimile. The stock record books and the
blank stock certificate books shall be kept by the Secretary, or at the office
of such transfer agent or transfer agents as the Board of Directors may from
time to time by resolution determine. In case any officer, transfer agent or
registrar who shall have signed or whose facsimile signature or signatures
shall have been placed upon any such certificate or certificates shall have
ceased to be such officer, transfer agent or registrar before such certificate
is issued by the Corporation, such certificate may nevertheless be issued by
the Corporation with the same effect as if such person were such officer,
transfer agent or registrar at the date of issue. The stock certificates shall
be consecutively numbered and shall be entered in the books of the Corporation
as they are issued and shall exhibit the holder's name and number of shares.
Section 2. Transfer of Shares. The shares of stock of the
Corporation shall be transferable only on the books of the Corporation by the
holders thereof in person or by their duly authorized
<PAGE> 13
attorneys or legal representatives upon surrender and cancellation of
certificates for a like number of shares. Upon surrender to the Corporation or
a transfer agent of the Corporation of a certificate for shares duly endorsed
or accompanied by proper evidence of succession, assignment or authority to
transfer, it shall be the duty of the Corporation to issue a new certificate to
the person entitled thereto, cancel the old certificate and record the
transaction upon its books.
Section 3. Ownership of Shares. The Corporation shall be
entitled to treat the holder of record of any share or shares of capital stock
of the Corporation as the holder in fact thereof and, accordingly, shall not be
bound to recognize any equitable or other claim to or interest in such share or
shares on the part of any other person, whether or not it shall have express or
other notice thereof, except as otherwise provided by the laws of the State of
Delaware.
Section 4. Regulations Regarding Certificates. The Board of
Directors shall have the power and authority to make all such rules and
regulations as they may deem expedient concerning the issue, transfer and
registration or the replacement of certificates for shares of capital stock of
the Corporation.
Section 5. Lost or Destroyed Certificates. The Board of
Directors may determine the conditions upon which a new certificate of stock
may be issued in place of a certificate which is alleged to have been lost,
stolen or destroyed; and may, in their discretion, require the owner of such
certificate or his legal representative to give bond, with sufficient surety,
to indemnify the Corporation and each transfer agent and registrar against any
and all losses or claims which may arise by reason of the issue of a new
certificate in the place of the one so lost, stolen or destroyed.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 1. Fiscal Year. The fiscal year of the Corporation
shall be such as established from time to time by the Board of Directors.
Section 2. Corporate Seal. The Board of Directors may provide a
suitable seal, containing the name of the Corporation. The Secretary shall
have charge of the seal (if any). If and when so directed by the Board of
Directors or a committee thereof, duplicates of the seal may be kept and used
by the Treasurer or by the Assistant Secretary or Assistant Treasurer.
Section 3. Notice and Waiver of Notice. Whenever any notice is
required to be given by law, the Certificate of Incorporation or under the
provisions of these bylaws, said notice shall be deemed to be sufficient if
given (i) by telegraphic, cable or wireless transmission or (ii) by deposit of
the same in a post office box in a sealed prepaid wrapper addressed to the
person entitled thereto at his post office address, as it appears on the
records of the Corporation, and such notice shall be deemed to have been given
on the day of such transmission or mailing, as the case may be.
Whenever notice is required to be given by law, the Certificate of
Incorporation or under any of the provisions of these bylaws, a written waiver
thereof, signed by the person entitled to notice, whether before or after the
time stated therein, shall be deemed equivalent to notice. Attendance of
<PAGE> 14
a person at a meeting shall constitute a waiver of notice of such meeting,
except when the person attends a meeting for the express purpose of objecting,
at the beginning of the meeting, to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the
stockholders, directors, or members of a committee of directors need be
specified in any written waiver of notice unless so required by the Certificate
of Incorporation or the bylaws.
Section 4. Resignations. Any director, member of a committee or
officer may resign at any time. Such resignation shall be made in writing and
shall take effect at the time specified therein, or if no time be specified, at
the time of its receipt by the chief executive officer or Secretary. The
acceptance of a resignation shall not be necessary to make it effective, unless
expressly so provided in the resignation.
Section 5. Facsimile Signatures. In addition to the provisions
for the use of facsimile signatures elsewhere specifically authorized in these
bylaws, facsimile signatures of any officer or officers of the Corporation may
be used whenever and as authorized by the Board of Directors.
Section 6. Reliance upon Books, Reports and Records. Each
director and each member of any committee designated by the Board of Directors
shall, in the performance of his duties, be fully protected in relying in good
faith upon the books of account or reports made to the Corporation by any of
its officers, or by an independent certified public accountant, or by an
appraiser selected with reasonable care by the Board of Directors or by any
such committee, or in relying in good faith upon other records of the
Corporation.
ARTICLE IX
AMENDMENTS
If provided in the Certificate of Incorporation of the Corporation,
the Board of Directors shall have the power to adopt, amend and repeal from
time to time bylaws of the Corporation, subject to the right of the
stockholders entitled to vote with respect thereto to amend or repeal such
bylaws as adopted or amended by the Board of Directors.
The undersigned, the Secretary of the Corporation, hereby certifies
that the foregoing bylaws were adopted by the Board of Directors of the
Corporation as of March ____, 1997.
<PAGE> 15
SCHEDULE OF MATERIAL DIFFERENCES
FROM BY-LAWS OF
ADDITIONAL OSBORN REGISTRANTS
1. The By-laws of Asheville Broadcasting Corp., Atlantic City
Broadcasting Corp., Breadbasket Broadcasting Corporation, Corkscrew
Broadcasting Corporation, Daytona Beach Broadcasting Corp.,
Houndstooth Broadcasting Corporation, Ladner Communications Holding
Corp., O.C.C., Inc., Osborn Entertainment Enterprises Corporation,
Osborn Sound & Communications Corp., Rainbow Broadcasting Corporation
and Southeast Radio Holding Corp. do not include the indemnification
provisions found in Article VI of the form By-laws.
2. Article VI of the By-laws of Great American East, Inc. ("Great
American") generally provides that Great American shall, to the
fullest extent permitted by the Business Corporation Act of the State
of North Carolina, indemnify any and all persons whom Great American
has the power to indemnify under the Business Corporation Act of the
State of North Carolina.
3. Article VI of the By-laws of Music Hall Club, Inc. ("Music Hall")
generally provides that Music Hall shall indemnify any and all persons
who may serve or who have served at any time as directors or officers,
or who at the request of the Board of Directors of Music Hall may
serve or who have served as directors or officers of another
corporation in which Music Hall at such time owned or may own shares
of stock or of which it may be a creditor.
<PAGE> 1
EXHIBIT 3.38.1
CERTIFICATE OF INCORPORATION
OF
COMMODORE HOLDINGS, INC.
ARTICLE ONE
The name of the corporation is Commodore Holdings, Inc. (hereinafter
called the "Corporation").
ARTICLE TWO
The address of the corporation's registered office in the State of
Delaware is 32 Loockerman Square, Suite L- 100, in the City of Dover, County of
Kent 19901. The name of its registered agent at such address is The
Prentice-Hall Corporation System, Inc.
ARTICLE THREE
The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of Delaware.
ARTICLE FOUR
The total number of shares which the Corporation shall have the
authority to issue is One Hundred Shares (100), all of which shall be shares of
Common Stock, with a par value of One Cent ($0.01) per share.
ARTICLE FIVE
The name and mailing address of the incorporator is as follows:
Name Address
---- -------
David N. Britsch c/o Kirkland & Ellis
153 E. 53rd Street
Suite 3900
New York, NY 10022
ARTICLE SIX
The directors shall have the power to adopt, amend or repeal By-Laws,
except as may be otherwise be provided in the By-Laws.
<PAGE> 2
ARTICLE SEVEN
The Corporation expressly elects not to be governed by Section 203 of
the General Corporation Law of the State of Delaware.
ARTICLE EIGHT
Section 1. Nature of Indemnity. Each person who was or is made
a party or is threatened to be made a party to or is involved in any action,
suit or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that he (or a person of
whom he is the legal representative), is or was a director or officer of the
Corporation or is or was serving at the request of the Corporation as a
director, officer, employee, fiduciary, or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether the basis of such proceeding is
alleged action in an official capacity as a director, officer, employee,
fiduciary or agent or in any other capacity while serving as a director,
officer, employee, fiduciary or agent, shall be indemnified and held harmless
by the Corporation to the fullest extent which it is empowered to do so by the
General Corporation Law of the State of Delaware, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the Corporation to provide broader
indemnification rights than said law permitted the Corporation to provide prior
to such amendment) against all expense, liability and loss (including
attorneys' fees actually and reasonably incurred by such person in connection
with such proceeding and such indemnification shall inure to the benefit of his
or her heirs, executors and administrators; provided, however, that, except as
provided in Section 2 of this Article Eight, the Corporation shall indemnify
any such person seeking indemnification in connection with a proceeding
initiated by such person only if such proceeding was authorized by the Board of
Directors of the Corporation. The right to indemnification conferred in this
Article Eight shall be a contract right and, subject to Sections 2 and 5 of
this Article Eight, shall include the right to payment by the Corporation of
the expenses incurred in defending any such proceeding in advance of its final
disposition. The Corporation may, by action of the Board of Directors, provide
indemnification to employees and agents of the Corporation with the same scope
and effect as the foregoing indemnification of directors and officers.
Section 2. Procedure for Indemnification of Directors an
Officers. Any indemnification of a director or officer of the Corporation
under Section 1 of this Article Eight or advance of expenses under Section 5 of
this Article Eight shall be made promptly, and in any event within 30 days,
upon the written request of the director or officer. If a determination by the
Corporation that the director or officer is entitled to indemnification
pursuant to this Article Eight is required, and the Corporation fails to
respond within sixty days to a written request for indemnity, the Corporation
shall be deemed to have approved the request. If the Corporation denies a
written request for indemnification or advancing of expenses, in whole or in
part, or if payment in full pursuant to such request is not made within 30
days, the right to indemnification or advances as granted by this Article Eight
shall be enforceable by the director or officer in any court of competent
jurisdiction. Such
<PAGE> 3
person's costs and expenses incurred in connection with successfully
establishing his right to indemnification, in whole or in part, in any such
action shall also be indemnified by the Corporation. It shall be a defense to
any such action (other than an action brought to enforce a claim for expenses
incurred in defending any proceeding in advance of its final disposition where
the required undertaking, if any, has been tendered to the Corporation) that
the claimant has not met the standards of conduct which make it permissible
under the General Corporation Law of the State of Delaware for the Corporation
to indemnify the claimant for the amount claimed, but the burden of such
defense shall be on the Corporation. Neither the failure of the Corporation
(including the Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the commencement of such
action that indemnification of the claimant is proper in the circumstances
because he or she has met the applicable standard of conduct set forth in the
General Corporation Law of the State of Delaware, nor an actual determination
by the Corporation (including its Board of Directors, independent legal
counsel, or its stockholders) that the claimant has not met such applicable
standard of conduct, shall be a defense to the action or create a presumption
that the claimant has not met the applicable standard of conduct.
Section 3. Nonexclusivity of Article Eight. The rights to
indemnification and the payment of expenses incurred in defending a proceeding
in advance of its final disposition conferred in this Article Eight shall not
be exclusive of any other right which any person may have or hereafter acquire
under any statute, provision of the certificate of incorporation, by-law,
agreement, vote of stockholders or disinterested directors or otherwise.
Section 4. Insurance. The Corporation may purchase and maintain
insurance on its own behalf and on behalf of any person who is or was a
director, officer, employee, fiduciary, or agent of the Corporation or was
serving at the request of the Corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise against any liability asserted against him or her and incurred by
him or her in any such capacity, whether or not the Corporation would have the
power to indemnify such person against such liability under this Article Eight.
Section 5. Expenses. Expenses incurred by any person described
in Section 1 of this Article Eight in defending a proceeding shall be paid by
the Corporation in advance of such proceeding's final disposition unless
otherwise determined by the Board of Directors in the specific case upon
receipt of an undertaking by or on behalf of the director or officer to repay
such amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Corporation. Such expenses incurred by other employees and
agents may be so paid upon such terms and conditions, if any, as the Board of
Directors deems appropriate.
Section 6. Employees and Agents. Persons who are not covered by
the foregoing provisions of this Article Eight and who are or were employees or
agents of the Corporation, or who are or were serving at the request of the
Corporation as employees or agents of another corporation, partnership, joint
venture, trust or other enterprise, may
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<PAGE> 4
be indemnified to the extent authorized at any time or from time to time by the
Board of Directors.
Section 7. Contract Rights. The provisions of this Article
Eight shall be deemed to be a contract right between the Corporation and each
director or officer who serves in any such capacity at any time while this
Article Eight and the relevant provisions of the General Corporation Law of the
State of Delaware or other applicable law are in effect, and any repeal or
modification of this Article Eight or any such law shall not affect any rights
or obligations then existing with respect to any state of facts or proceeding
then existing.
Section 8. Merger or Consolidation. For purposes of this
Article Eight, references to "the Corporation" shall include, in addition to
the resulting corporation, any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or merger which, if
its separate existence had continued, would have had power and authority to
indemnify its directors, officers, and employees or agents, so that any person
who is or was a director, officer, employee or agent of such constituent
corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in the same
position under this Article Eight with respect to the resulting or surviving
corporation as he or she would have with respect to such constituent
corporation if its separate existence had continued.
ARTICLE NINE
The Corporation reserves the right to amend or repeal any provisions
contained in this Certificate of Incorporation from time to time and at any
time in the manner now or hereafter prescribed by the laws of the State of
Delaware, and all rights conferred upon stockholders and directors are granted
subject to such reservation.
I, the undersigned, being the sole incorporator hereinbefore named,
for the purpose of forming a corporation in pursuance of the General
Corporation Law of the State of Delaware, do make and file this Certificate,
hereby declaring and certifying that the facts herein stated are true, and
accordingly have hereunto set my hand this 5th day of April, 1995.
/s/ David N. Britsch
-------------------------------------------
David N. Britsch, Sole Incorporator
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<PAGE> 1
EXHIBIT 3.38.2
BY-LAWS
OF
COMMODORE HOLDINGS, INC.
A DELAWARE CORPORATION
ARTICLE I
OFFICES
Section 1. Registered Office. The registered office of the
corporation in the State of Delaware shall be located at 32 Loockerman Square,
Suite L-100, Dover, Delaware 19901, in the County of Kent. The name of the
corporation's registered agent at such address shall be The Prentice-Hall
Corporation System, Inc. The registered office and/or registered agent of the
corporation may be changed from time to time by action of the board of
directors.
Section 2. Other Offices. The corporation may also have offices
at such other places, both within and without the State of Delaware, as the
board of directors may from time to time determine or the business of the
corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. Place and Time of Meetings. An annual meeting of the
stockholders shall be held each year for the purpose of electing directors and
conducting such other proper business as may come before the meeting. The
date, time and place of the annual meeting may be determined by resolution of
the board of directors or as set by the president of the corporation.
Section 2. Special Meetings. Special meetings of stockholders
may be called for any purpose (including, without limitation, the filling of
board vacancies and newly created directorships), and may be held at such time
and place, within or without the State of Delaware, as shall be stated in a
notice of meeting or in a duly executed waiver of notice thereof. Such
meetings may be called at any time by two or more members of the board of
directors or the president and shall be called by the president upon the
written request of holders of shares entitled to cast not less than thirty
percent (30%) of the outstanding shares of any series or class of the
corporation's Capital Stock.
Section 3. Place of Meetings. The board of directors may
designate any place, either within or without the State of Delaware, as the
place of meeting for any annual meeting or for any special meeting called by
the board of directors. If no designation is made, or if a special meeting be
otherwise called, the place of meeting shall be the principal executive office
of the corporation.
Section 4. Notice. Whenever stockholders are required or
permitted to take action at a meeting, written or printed notice stating the
place, date, time, and, in the case of special meetings, the purpose or
purposes, of such meeting, shall be given to each stockholder entitled to vote
at such meeting not less than 10 nor more than 60 days before the date of the
meeting. All such notices shall be delivered, either personally or by mail, by
or at the direction of the board of directors, the president or the secretary,
and if mailed, such
<PAGE> 2
notice shall be deemed to be delivered when deposited in the United States
mail, postage prepaid, addressed to the stockholder at his, her or its address
as the same appears on the records of the corporation. Attendance of a person
at a meeting shall constitute a waiver of notice of such meeting, except when
the person attends for the express purpose of objecting at the beginning of the
meeting to the transaction of any business because the meeting is not lawfully
called or convened.
Section 5. Stockholders List. The officer having charge of the
stock ledger of the corporation shall make, at least 10 days before every
meeting of the stockholders, a complete list of the stockholders entitled to
vote at such meeting arranged in alphabetical order, showing the address of
each stockholder and the number of shares registered in the name of each
stockholder. Such list shall be open to the examination of any stockholder,
for any purpose germane to the meeting, during ordinary business hours, for a
period of at least 10 days prior to the meeting, either at a place within the
city where the meeting is to be held, which place shall be specified in the
notice of the meeting or, if not so specified, at the place where the meeting
is to be held. The list shall also be produced and kept at the time and place
of the meeting during the whole time thereof, and may be inspected by any
stockholder who is present.
Section 6. Quorum. Except as otherwise provided by applicable
law or by the Certificate of Incorporation, a majority of the outstanding
shares of the corporation entitled to vote, represented in person or by proxy,
shall constitute a quorum at a meeting of stockholders. If less than a
majority of the outstanding shares are represented at a meeting, a majority of
the shares so represented may adjourn the meeting from time to time in
accordance with Section 7 of this Article, until a quorum shall be present or
represented.
Section 7. Adjourned Meetings. When a meeting is adjourned to
another time and place, notice need not be given of the adjourned meeting if
the time and place thereof are announced at the meeting at which the
adjournment is taken. At the adjourned meeting the corporation may transact
any business which might have been transacted at the original meeting. If the
adjournment is for more than thirty days, or if after the adjournment a new
record date is fixed for the adjourned meeting, a notice of the adjourned
meeting shall be given to each stockholder of record entitled to vote at the
meeting.
Section 8. Vote Required. When a quorum is present, the
affirmative vote of the majority of shares present in person or represented by
proxy at the meeting and entitled to vote on the subject matter shall be the
act of the stockholders, unless the question is one upon which by express
provisions of an applicable law or of the certificate of incorporation a
different vote is required, in which case such express provision shall govern
and control the decision of such question. Where a separate vote by class is
required, the affirmative vote of the majority of shares of such class present
in person or represented by proxy at the meeting shall be the act of such
class.
Section 9. Voting Rights. Except as otherwise provided by the
General Corporation Law of the State of Delaware or by the certificate of
incorporation of the corporation or any amendments thereto and subject to
Section 3 of Article VI hereof, every stockholder shall at every meeting of the
stockholders be entitled to one vote in person or by proxy for each share of
common stock held by such stockholder.
Section 10. Proxies. Each stockholder entitled to vote at a
meeting of stockholders or to express consent or dissent to corporate action in
writing without a meeting may authorize another person or persons to act for
him, her or it by proxy. Every proxy must be signed by the stockholder
granting the proxy or by his, her or its attorney-in- fact. No proxy shall be
voted or acted upon after three years from its date, unless the proxy provides
for a longer period. A duly executed proxy shall be irrevocable if it states
that it is irrevocable and if, and only as long as, it is coupled with an
interest sufficient in law to support an irrevocable power. A proxy may be
made irrevocable regardless of whether the interest with which it is coupled is
an interest in the stock itself or an interest in the Corporation generally.
<PAGE> 3
Section 11. Action by Written Consent. Unless otherwise provided
in the certificate of incorporation, any action required to be taken at any
annual or special meeting of stockholders of the corporation, or any action
which may be taken at any annual or special meeting of such stockholders, may
be taken without a meeting, without prior notice and without a vote, if a
consent or consents in writing, setting forth the action so taken and bearing
the dates of signature of the stockholders who signed the consent or consents,
shall be signed by the holders of outstanding stock having not less than a
majority of the shares entitled to vote, or, if greater, not less than the
minimum number of votes that would be necessary to authorize or take such
action at a meeting at which all shares entitled to vote thereon were present
and voted and shall be delivered to the corporation by delivery to its
registered office in the state of Delaware, or the corporation's principal
place of business, or an officer or agent of the corporation having custody of
the book or books in which proceedings of meetings of the stockholders are
recorded. Delivery made to the corporation's registered office shall be by
hand or by certified or registered mail, return receipt requested provided,
however, that no consent or consents delivered by certified or registered mail
shall be deemed delivered until such consent or consents are actually received
at the registered office. All consents properly delivered in accordance with
this section shall be deemed to be recorded when so delivered. No written
consent shall be effective to take the corporate action referred to therein
unless, within sixty days of the earliest dated consent delivered to the
corporation as required by this section, written consents signed by the holders
of a sufficient number of shares to take such corporate action are so recorded.
Prompt notice of the taking of the corporate action without a meeting by less
than unanimous written consent shall be given to those stockholders who have
not consented in writing. Any action taken pursuant to such written consent or
consents of the stockholders shall have the same force and effect as if taken
by the stockholders at a meeting thereof.
ARTICLE III
DIRECTORS
Section 1. General Powers. The business and affairs of the
corporation shall be managed by or under the direction of the board of
directors.
Section 2. Number, Election and Term of Office. The number of
directors which shall constitute the first board shall be one (1). Thereafter,
the number of directors shall be established from time to time by resolution of
the board. The directors shall be elected by a plurality of the votes of the
shares present in person or represented by proxy at the meeting and entitled to
vote in the election of directors. The directors shall be elected in this
manner at the annual meeting of the stockholders, except as provided in Section
4 of this Article III. Each director elected shall hold office until a
successor is duly elected and qualified or until his or her earlier death,
resignation or removal as hereinafter provided.
Section 3. Removal and Resignation. Any director or the entire
board of directors may be removed at any time, with or without cause, by the
holders of a majority of the shares then entitled to vote at an election of
directors. Whenever the holders of any class or series are entitled to elect
one or more directors by the provisions of the corporation's certificate of
incorporation, the provisions of this section shall apply, in respect to the
removal without cause or a director or directors so elected, to the vote of the
holders of the outstanding shares of that class or series and not to the vote
of the outstanding shares as a whole. Any director may resign at any time upon
written notice to the corporation.
Section 4. Vacancies. Except as otherwise provided by the
Certificate of Incorporation of the corporation or any amendments thereto,
vacancies and newly created directorships resulting from any increase in the
authorized number of directors may be filled by a majority vote of the holders
of the corporation's outstanding stock entitled to vote thereon. Each director
so chosen shall hold office until a successor is duly elected and qualified or
until his or her earlier death, resignation or removal as herein provided.
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<PAGE> 4
Section 5. Annual Meetings The annual meeting of each newly
elected board of directors shall be held without other notice than this by-law
immediately after, and at the same place as, the annual meeting of
stockholders.
Section 6. Other Meetings and Notice. Regular meetings, other
than the annual meeting, of the board of directors may be held without notice
at such time and at such place as shall from time to time be determined by
resolution of the board. Special meetings of the board of directors may be
called by or at the request of the president or vice president on at least 24
hours notice to each director, either personally, by telephone, by mail, or by
telegraph; in like manner and on like notice the president must call a special
meeting on the written request of at least a majority of the directors.
Section 7. Quorum. Required Vote and Adjournment. A majority
of the total number of directors shall constitute a quorum for the transaction
of business. The vote of a majority of directors present at a meeting at which
a quorum is present shall be the act of the board of directors. If a quorum
shall not be present at any meeting of the board of directors, the directors
present thereat may adjourn the meeting from time to time, without notice other
than announcement at the meeting, until a quorum shall be present.
Section 8. Committees. The board of directors may, by
resolution passed by a majority of the whole board, designate one or more
committees, each committee to consist of one or more of the directors of the
corporation, which to the extent provided in such resolution or these by-laws
shall have and may exercise the powers of the board of directors in the
management and affairs of the corporation except as otherwise limited by law.
The board of directors may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. Such committee or committees shall have such name or
names as may be determined from time to time by resolution adopted by the board
of directors. Each committee shall keep regular minutes of its meetings and
report the same to the board of directors when required.
Section 9. Committee Rules. Each committee of the board of
directors may fix its own rules of procedure and shall hold its meetings as
provided by such rules, except as may otherwise be provided by a resolution of
the board of directors designating such committee. Unless otherwise provided
in such a resolution, the presence of at least a majority of the members of the
committee shall be necessary to constitute a quorum. In the event that a
member and that member's alternate, if alternates are designated by the board
of directors as provided in Section 8 of this Article III, of such committee is
or are absent or disqualified, the member or members thereof present at any
meeting and not disqualified from voting, whether or not such member or members
constitute a quorum, may unanimously appoint another member of the board of
directors to act at the meeting in place of any such absent or disqualified
member.
Section 10. Communications Equipment. Members of the board of
directors or any committee thereof may participate in and act at any meeting of
such board or committee through the use of a conference telephone or other
communications equipment by means of which all persons participating in the
meeting can hear each other, and participation in the meeting pursuant to this
section shall constitute presence in person at the meeting.
Section 11. Waiver of Notice and Presumption of Assent. Any
member of the board of directors or any committee thereof who is present at a
meeting shall be conclusively presumed to have waived notice of such meeting
except when such member attends for the express purpose of objecting at the
beginning of the meeting to the transaction of any business because the meeting
is not lawfully called or convened. Such member shall be conclusively presumed
to have assented to any action taken unless his or her dissent shall be entered
in the minutes of the meeting or unless his or her written dissent to such
action shall be filed with the person acting as the secretary of the meeting
before the adjournment thereof or shall be forwarded by registered
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<PAGE> 5
mail to the secretary of the corporation immediately after the adjournment of
the meeting. Such right to dissent shall not apply to any member who voted in
favor of such action.
Section 12. Action by Written Consent. Unless otherwise
restricted by the certificate of incorporation, any action required or
permitted to be taken at any meeting of the board of directors, or of any
committee thereof, may be taken without a meeting if all members of the board
or committee, as the case may be, consent thereto in writing, and the writing
or writings are filed with the minutes of proceedings of the board or
committee.
ARTICLE IV
OFFICERS
Section 1. Number. The officers of the corporation shall be
elected by the board of directors and shall consist of a chairman, if any is
elected, a president, one or more vice presidents, a secretary, a treasurer,
and such other officers and assistant officers as may be deemed necessary or
desirable by the board of directors. Any number of offices may be held by the
same person, except that no person may simultaneously hold the office of
president and secretary. In its discretion, the board of directors may choose
not to fill any office for any period as it may deem advisable.
Section 2. Election and Term of Office. The officers of the
corporation shall be elected annually by the board of directors at its first
meeting held after each annual meeting of stockholders or as soon thereafter as
conveniently may be. The president shall appoint other officers to serve for
such terms as he or she deems desirable. Vacancies may be filled or new
offices created and filled at any meeting of the board of directors. Each
officer shall hold office until a successor is duly elected and qualified or
until his or her earlier death, resignation or removal as hereinafter provided.
Section 3. Removal. Any officer or agent elected by the board
of directors may be removed by the board of directors whenever in its judgment
the best interests of the corporation would be served thereby, but such removal
shall be without prejudice to the contract rights, if any, of the person so
removed.
Section 4. Vacancies. Any vacancy occurring in any office
because of death, resignation, removal, disqualification or otherwise, may be
filled by the board of directors for the unexpired portion of the term by the
board of directors then in office.
Section 5. Compensation. Compensation of all officers shall be
fixed by the board of directors, and no officer shall be prevented from
receiving such compensation by virtue of his or her also being a director of
the corporation.
Section 6. The Chairman of the Board. The Chairman of the
Board, if one shall have been elected, shall be a member of the board, an
officer of the Corporation, and, if present, shall preside at each meeting of
the board of directors or shareholders. The Chairman of the Board shall, in
the absence or disability of the president, act with all of the powers and be
subject to all the restrictions of the president. He shall advise the
president, and in the president's absence, other officers of the Corporation,
and shall perform such other duties as may from time to time be assigned to him
by the board of directors.
Section 7. The President. The president shall be the chief
executive officer of the corporation. In the absence of the Chairman of the
Board or if a Chairman of the Board shall have not been elected, the president
shall preside at all meetings of the stockholders and board of directors at
which he or she is present; subject to the powers of the board of directors,
shall have general charge of the business, affairs and property
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<PAGE> 6
of the corporation, and control over its officers, agents and employees; and
shall see that all orders and resolutions of the board of directors are carried
into effect. The president shall have such other powers and perform such other
duties as may be prescribed by the board of directors or as may be provided in
these by-laws
Section 8. Vice-Presidents. The vice-president, if any, or if
there shall be more than one, the vice- presidents in the order determined by
the board of directors shall, in the absence or disability of the president,
act with all of the powers and be subject to all the restrictions of the
president. The vice-presidents shall also perform such other duties and have
such other powers as the board of directors, the president or these by-laws
may, from time to time, prescribe.
Section 9. The Secretary and Assistant Secretaries. The
secretary shall attend all meetings of the board of directors, all meetings of
the committees thereof and all meetings of the stockholders and record all the
proceedings of the meetings in a book or books to be kept for that purpose.
Under the president's supervision, the secretary shall give, or cause to be
given, all notices required to be given by these by-laws or by law; shall have
such powers and perform such duties as the board of directors, the president or
these by-laws may, from time to time, prescribe; and shall have custody of the
corporate seal of the corporation. The secretary, or an assistant secretary,
shall have authority to affix the corporate seal to any instrument requiring it
and when so affixed, it may be attested by his or her signature or by the
signature of such assistant secretary. The board of directors may give general
authority to any other officer to affix the seal of the corporation and to
attest the affixing by his or her signature. The assistant secretary, or if
there be more than one, the assistant secretaries in the order determined by
the board of directors, shall, in the absence or disability of the secretary,
perform the duties and exercise the powers of the secretary and shall perform
such other duties and have such other powers as the board of directors, the
president, or secretary may, from time to time, prescribe.
Section 10. The Treasurer and Assistant Treasurer. The treasurer
shall have the custody of the corporate funds and securities; shall keep full
and accurate accounts of receipts and disbursements in books belonging to the
corporation; shall deposit all monies and other valuable effects in the name
and to the credit of the corporation as may be ordered by the board of
directors; shall cause the funds of the corporation to be disbursed when such
disbursements have been duly authorized, taking proper vouchers for such
disbursements; and shall render to the president and the board of directors, at
its regular meeting or when the board of directors so requires, an account of
the corporation; shall have such powers and perform such duties as the board of
directors, the president or these by-laws may, from time to time, prescribe.
If required by the board of directors, the treasurer shall give the corporation
a bond (which shall be rendered every six years) in such sums and with such
surety or sureties as shall be satisfactory to the board of directors for the
faithful performance of the duties of the office of treasurer and for the
restoration to the corporation, in case of death, resignation, retirement, or
removal from office, of all books, papers, vouchers, money, and other property
of whatever kind in the possession or under the control of the treasurer
belonging to the corporation. The assistant treasurer, or if there shall be
more than one, the assistant treasurers in the order determined by the board of
directors, shall in the absence or disability of the treasurer, perform the
duties and exercise the powers of the treasurer. The assistant treasurers
shall perform such other duties and have such other powers as the board of
directors, the president or treasurer may, from time to time, prescribe.
Section 11. Other Officers, Assistant Officers and Agents.
Officers, assistant officers and agents, if any, other than those whose duties
are provided for in these by-laws, shall have such authority and perform such
duties as may from time to time be prescribed by resolution of the board of
directors.
Section 12. Absence or Disability of Officers. In the case of
the absence or disability of any officer of the corporation and of any person
hereby authorized to act in such officer's place during such
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<PAGE> 7
officer's absence or disability, the board of directors may by resolution
delegate the powers and duties of such officer to any other officer or to any
director, or to any other person whom it may select.
ARTICLE V
INDEMNIFICATION OF OFFICERS, DIRECTORS AND OTHERS
Section 1. Nature of Indemnity. Each person who was or is made
a party or is threatened to be made a party to or is involved in any action,
suit or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that he or a person of whom
he is the legal representative, is or was a director or officer, of the
corporation or is or was serving at the request of the corporation as a
director, officer, employee, fiduciary, or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether the basis of such proceeding is
alleged action in an official capacity as a director, officer, employee,
fiduciary or agent or in any other capacity while serving as a director,
officer, employee, fiduciary or agent, shall be indemnified and held harmless
by the corporation to the fullest extent which it is empowered to do so by the
General Corporation Law of the State of Delaware, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the
extent that such amendment permits the corporation to provide broader
indemnification rights than said law permitted the corporation to provide prior
to such amendment) against all expense, liability and loss (including
attorneys' fees actually and reasonably incurred by such person in connection
with such proceeding and such indemnification shall inure to the benefit of his
or her heirs, executors and administrators; provided, however, that, except as
provided in Section 2 hereof, the corporation shall indemnify any such person
seeking indemnification in connection with a proceeding initiated by such
person only if such proceeding was authorized by the board of directors of the
corporation. The right to indemnification conferred in this Article V shall be
a contract right and, subject to Sections 2 and 5 hereof, shall include the
right to be paid by the corporation the expenses incurred in defending any such
proceeding in advance of its final disposition. The corporation may, by action
of its board of directors, provide indemnification to employees and agents of
the corporation with the same scope and effect as the foregoing indemnification
of directors and officers.
Section 2. Procedure for Indemnification of Directors and
Officers. Any indemnification of a director or officer of the corporation
under Section 1 of this Article V or advance of expenses under Section 5 of
this Article V shall be made promptly, and in any event within 30 days, upon
the written request of the director or officer. If a determination by the
corporation that the director or officer is entitled to indemnification
pursuant to this Article V is required, and the corporation fails to respond
within sixty days to a written request for indemnity, the corporation shall be
deemed to have approved the request. If the corporation denies a written
request for indemnification or advancing of expenses, in whole or in part, or
if payment in full pursuant to such request is not made within 30 days, the
right to indemnification or advances as granted by this Article V shall be
enforceable by the director or officer in any court of competent jurisdiction.
Such person's costs and expenses incurred in connection with successfully
establishing his or her right to indemnification, in whole or in part, in any
such action shall also be indemnified by the corporation. It shall be a
defense to any such action (other than an action brought to enforce a claim for
expenses incurred in defending any proceeding in advance of its final
disposition where the required undertaking, if any, has been tendered to the
corporation) that the claimant has not met the standards of conduct which make
it permissible under the General Corporation Law of the State of Delaware for
the corporation to indemnify the claimant for the amount claimed, but the
burden of such defense shall be on the corporation. Neither the failure of the
corporation (including its board of directors, independent legal counsel, or
its stockholders) to have made a determination prior to the commencement of
such action that indemnification of the claimant is proper in the circumstances
because he or she has met the applicable standard of conduct set forth in the
General Corporation Law of the State of Delaware, nor an actual determination
by the corporation (including its board
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<PAGE> 8
of directors, independent legal counsel, or its stockholders) that the claimant
has not met such applicable standard of conduct, shall be a defense to the
action or create a presumption that the claimant has not met the applicable
standard of conduct.
Section 3. Nonexclusivity of Article V. The rights to
indemnification and the payment of expenses incurred in defending a proceeding
in advance of its final disposition conferred in this Article V shall not be
exclusive of any other right which any person may have or hereafter acquire
under any statute, provision of the certificate of incorporation, by-law,
agreement, vote of stockholders or disinterested directors or otherwise.
Section 4. Insurance. The corporation may purchase and maintain
insurance on its own behalf and on behalf of any person who is or was a
director, officer, employee, fiduciary, or agent of the corporation or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise against any liability asserted against him or her and incurred by
him or her in any such capacity, whether or not the corporation would have the
power to indemnify such person against such liability under this Article V.
Section 5. Expenses. Expenses incurred by any person described
in Section 1 of this Article V in defending a proceeding shall be paid by the
corporation in advance of such proceeding's final disposition unless otherwise
determined by the board of directors in the specific case upon receipt of an
undertaking by or on behalf of the director or officer to repay such amount if
it shall ultimately be determined that he or she is not entitled to be
indemnified by the corporation. Such expenses incurred by other employees and
agents may be so paid upon such terms and conditions, if any, as the board of
directors deems appropriate.
Section 6. Employees and Agents. Persons who are not covered by
the foregoing provisions of this Article V and who are or were employees or
agents of the corporation, or who are or were serving at the request of the
corporation as employees or agents of another corporation, partnership, joint
venture, trust or other enterprise, may be indemnified to the extent authorized
at any time or from time to time by the board of directors.
Section 7. Contract Rights. The provisions of this Article V
shall be deemed to be a contract right between the corporation and each
director or officer who serves in any such capacity at any time while this
Article V and the relevant provisions of the General Corporation Law of the
State of Delaware or other applicable law are in effect, and any repeal or
modification of this Article V or any such law shall not affect any rights or
obligations then existing with respect to any state of facts or proceeding then
existing,
Section 8. Merger or Consolidation. For purposes of this
Article V, references to "the corporation" shall include, in addition to the
resulting corporation, any constituent corporation (including any constituent
of a constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, and employees or agents, so that any person who is or was
a director, officer, employee or agent of such constituent corporation, or is
or was serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under this Article
V with respect to the resulting or surviving corporation as he or she would
have with respect to such constituent corporation if its separate existence had
continued.
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<PAGE> 9
ARTICLE VI
CERTIFICATES OF STOCK
Section 1. Form. Every holder of stock in the corporation shall
be entitled to have a certificate, signed by, or in the name of the corporation
by the chairman of the board, the president or a vice-president and the
secretary or an assistant secretary of the corporation, certifying the number
of shares owned by such holder in the corporation. If such a certificate is
countersigned (1) by a transfer agent or an assistant transfer agent other than
the corporation or its employee or (2) by a registrar, other than the
corporation or its employee, the signature of any such chairman of the board,
president, vice-president, secretary, or assistant secretary may be facsimiles.
In case any officer or officers who have signed, or whose facsimile signature
or signatures have been used on, any such certificate or certificates shall
cease to be such officer or officers of the corporation whether because of
death, resignation or otherwise before such certificate or certificates have
been delivered by the corporation, such certificate or certificates may
nevertheless be issued and delivered as though the person or persons who signed
such certificate or certificates or whose facsimile signature or signatures
have been used thereon had not ceased to be such officer or officers of the
corporation. All certificates for shares shall be consecutively numbered or
otherwise identified. The name of the person to whom the shares represented
thereby are issued, with the number of shares and date of issue, shall be
entered on the books of the corporation. Shares of stock of the corporation
shall only be transferred on the books of the corporation by the holder of
record thereof or by such holder's attorney duly authorized in writing, upon
surrender to the corporation of the certificate or certificates for such shares
endorsed by the appropriate person or persons, with such evidence of the
authenticity of such endorsement, transfer, authorization, and other matters as
the corporation may reasonably require, and accompanied by all necessary stock
transfer stamps. In that event, it shall be the duty of the corporation to
issue a new certificate to the person entitled thereto, cancel the old
certificate or certificates, and record the transaction on its books. The
board of directors may appoint a bank or trust company organized under the laws
of the United States or any state thereof to act as its transfer agent or
registrar, or both in connection with the transfer of any class or series of
securities of the corporation.
Section 2. Lost Certificates. The board of directors may direct
a new certificate or certificates to be issued in place of any certificate or
certificates previously issued by the corporation alleged to have been lost,
stolen, or destroyed, upon the making of an affidavit of that fact by the
person claiming the certificate of stock to be lost, stolen, or destroyed.
When authorizing such issue of a new certificate or certificates, the board of
directors may, in its discretion and as a condition precedent to the issuance
thereof, require the owner of such lost, stolen, or destroyed certificate or
certificates, or his or her legal representative, to give the corporation a
bond sufficient to indemnify the corporation against any claim that may be made
against the corporation on account of the loss, theft or destruction of any
such certificate or the issuance of such new certificate.
Section 3. Fixing a Record Date for Stockholder Meeting. In
order that the corporation may determine the stockholders entitled to notice of
or to vote at any meeting of stockholders or any adjournment thereof, the board
of directors may fix a record date, which record date shall not precede the
date upon which the resolution fixing the record date is adopted by the board
of directors, and which record date shall not be more than sixty nor less than
ten days before the date of such meeting. If no record date is fixed by the
board of directors, the record date for determining stockholders entitled to
notice of or to vote at a meeting of stockholders shall be the close of
business on the next day preceding the day on which notice is given, or if
notice is waived, at the close of business on the day next preceding the day on
which the meeting is held. A determination of stockholders of record entitled
to notice of or to vote at a meeting of stockholders shall apply to any
adjournment of the meeting; provided, however, that the board of directors may
fix a new record date for the adjourned meeting.
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<PAGE> 10
Section 4. Fixing a Record Date for Action by Written Consent.
In order that the corporation may determine the stockholders entitled to
consent to corporate action in writing without a meeting, the board of
directors may fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted by the board of
directors, and which date shall not be more than ten days after the date upon
which the resolution fixing the record date is adopted by the board of
directors. If no record date has been fixed by the board of directors, the
record date for determining stockholders entitled to consent to corporate
action in writing without a meeting, when no prior action by the board of
directors is required by statute, shall be the first date on which a signed
written consent setting forth the action taken or proposed to be taken is
delivered to the corporation by delivery to its registered office in the State
of Delaware, its principal place of business, or an officer or agent of the
corporation having custody of the book in which proceedings of meetings of
stockholders are recorded. Delivery made to the corporation's registered
office shall be by hand or by certified or registered mail, return receipt
requested. If no record date has been fixed by the board of directors and
prior action by the board of directors is required by statute, the record date
for determining stockholders entitled to consent to corporate action in writing
without a meeting shall be at the close of business on the day on which the
board of directors adopts the resolution taking such prior action.
Section 5. Fixing a Record Date for Other Purposes. In order
that the corporation may determine the stockholders entitled to receive payment
of any dividend or other distribution or allotment or any rights or the
stockholders entitled to exercise any rights in respect of any change,
conversion or exchange of stock, or for the purposes of any other lawful
action, the board of directors may fix a record date, which record date shall
not precede the date upon which the resolution fixing the record date is
adopted, and which record date shall be not more than sixty days prior to such
action. If no record date is fixed, the record date for determining
stockholders for any such purpose shall be at the close of business on the day
on which the board of directors adopts the resolution relating thereto.
Section 6. Subscriptions for Stock. Unless otherwise provided
for in the subscription agreement, subscriptions for shares shall be paid in
full at such time, or in such installments and at such times, as shall be
determined by the board of directors. Any call made by the board of directors
for payment on subscriptions shall be uniform as to all shares of the same
class or as to all shares of the same series. In case of default in the
payment of any installment or call when such payment is due, the corporation
may proceed to collect the amount due in the same manner as any debt due the
corporation.
ARTICLE VII
GENERAL PROVISIONS
Section 1. Dividends. Dividends upon the capital stock of the
corporation, subject to the provisions of the certificate of incorporation, if
any, may be declared by the board of directors at any regular or special
meeting, pursuant to law. Dividends may be paid in cash, in property, or in
shares of the capital stock, subject to the provisions of the certificate of
incorporation. Before payment of any dividend, there may be set aside out of
any funds of the corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or any other purpose
and the directors may modify or abolish any such reserve in the manner in which
it was created.
Section 2. Checks, Drafts or Orders. All checks, drafts, or
other orders for the payment of money by or to the corporation and all notes
and other evidences of indebtedness issued in the name of the corporation shall
be signed by such officer or officers, agent or agents of the corporation, and
in such manner, as shall be determined by resolution of the board of directors
or a duly authorized committee thereof
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<PAGE> 11
Section 3. Contracts. The board of directors may authorize any
officer or officers, or any agent or agents, of the corporation to enter into
any contract or to execute and deliver any instrument in the name of and on
behalf of the corporation, and such authority may be general or confined to
specific instances.
Section 4. Loans. The corporation may lend money to, or
guarantee any obligation of, or otherwise assist any officer or other employee
of the corporation or of its subsidiary, including any officer or employee who
is a director of the corporation or its subsidiary, whenever, in the judgment
of the directors, such loan, guaranty or assistance may reasonably be expected
to benefit the corporation. The loan, guaranty or other assistance may be with
or without interest, and may be unsecured, or secured in such manner as the
board of directors shall approve, including, without limitation a pledge of
shares of stock of the corporation. Nothing in this section contained shall be
deemed to deny, limit or restrict the powers of guaranty or warranty of the
corporation at common law or under any statute.
Section 5. Fiscal Year. The fiscal year of the corporation
shall be fixed by resolution of the board of directors.
Section 6. Corporate Seal. The board of directors may provide a
corporate seal which shall be in the form of a circle and shall have inscribed
thereon the name of the corporation and the words "Corporate Seal, Delaware".
The seal may be used by causing it or a facsimile thereof to be impressed or
affixed or reproduced or otherwise.
Section 7. Voting Securities Owned By Corporation. Voting
securities in any other corporation held by the corporation shall be voted by
the president, unless the board of directors specifically confers authority to
vote with respect thereto, which authority may be general or confined to
specific instances, upon some other person or officer. Any person authorized
to vote securities shall have the power to appoint proxies, with general power
of substitution.
Section 8. Inspection of Books and Records. Any stockholder of
record, in person or by attorney or other agent, shall, upon written demand
under oath stating the purpose thereof, have the right during the usual hours
for business to inspect for any proper purpose the corporation's stock ledger,
a list of its stockholders, and its other books and records, and to make copies
or extracts therefrom. A proper purpose shall mean any purpose reasonably
related to such person's interest as a stockholder. In every instance where an
attorney or other agent shall be the person who seeks the right to inspection,
the demand under oath shall be accompanied by a power of attorney or such other
writing which authorizes the attorney or other agent to so act on behalf of the
stockholder. The demand under oath shall be directed to the corporation at its
registered office in the State of Delaware or at its principal place of
business.
Section 9. Section Headings. Section headings in these by-laws
are for convenience of reference only and shall not be given any substantive
effect in limiting or otherwise construing any provision herein.
Section 10. Inconsistent Provisions. In the event that any
provision of these by-laws is or becomes inconsistent with any provision of the
certificate of incorporation, the General Corporation Law of the State of
Delaware or any other applicable law, the provision of these by-laws shall not
be given any effect to the extent of such inconsistency but shall otherwise be
given full force and effect.
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<PAGE> 12
ARTICLE VIII
AMENDMENTS
These by-laws may be amended, altered, or repealed and new by-laws
adopted at any meeting of the board of directors by a majority vote. The fact
that the power to adopt, amend, alter, or repeal the by-laws has been conferred
upon the board of directors shall not divest the stockholders of the same
powers.
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<PAGE> 1
EXHIBIT 3.38.3
CERTIFICATE OF AMENDMENT
OF BYLAWS OF
COMMODORE HOLDINGS, INC.
The undersigned, being the duly elected and acting Secretary of
Commodore Holdings, Inc. (the "Corporation"), hereby certifies that Article IV
of the Bylaws of the Corporation has been amended, effective November 4, 1996,
by the Board of Directors to read in its entirety as set forth in Exhibit I
attached hereto.
Dated: November 4, 1996
/s/ James J. Sullivan
----------------------------------------
James J. Sullivan, Secretary
<PAGE> 2
EXHIBIT I
AMENDMENT TO BYLAWS OF THE CORPORATION
ARTICLE III
OFFICERS
SECTION 1. The officers of the Corporation shall be a President, one
or more Vice Presidents (any one or more of whom may be designated Executive
Vice President or Senior Vice President), a Treasurer, a Secretary and, if the
Board of Directors so elects, a Chairman of the Board and such other officers
as the Board of Directors may from time to time elect or appoint. Each officer
shall hold office until his successor shall be duly elected and shall qualify
or until his death or until he shall resign or shall have been removed in the
manner hereinafter provided. Any number of offices may be held by the same
person, unless the Certificate of Incorporation provides otherwise. Except for
the Chairman of the Board, if any, no officer need be a director.
SECTION 2. The salaries or other compensation of the officers and
agents of the Corporation shall be fixed from time to time by the Board of
Directors.
SECTION 3. Any officer or agent elected or appointed by the Board of
Directors may be removed, either with or without cause, by the vote of a
majority of the whole Board of Directors at a special meeting called for the
purpose, or at any regular meeting of the Board of Directors, provided the
notice for such meeting shall specify that the matter of any such proposed
removal will be considered at the meeting but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent shall not of itself create contract
rights.
SECTION 4. Any vacancy occurring in any office of the Corporation
may be filled by the Board of Directors.
SECTION 5. The President shall be the chief executive officer of the
Corporation unless the Board of Directors elects or appoints a chief executive
officer or designates the Chairman of the Board as chief executive officer.
Subject to the control of the Board of Directors and the executive committee
(if any), the chief executive officer shall have general executive charge,
management and control of the properties, business and operations of the
Corporation with all such powers as may be reasonably incident to such
responsibilities; he may agree upon and execute all leases, contracts,
evidences of indebtedness and other obligations in the name of the Corporation
and may sign all certificates for shares of capital stock of the Corporation;
unless the Board of Directors otherwise determines, the chief executive officer
shall, in the absence of the Chairman of the Board or if there be no Chairman
of the Board, preside at all meetings of the stockholders and (should he be a
director) of the Board of Directors; and shall have such other powers and
duties as designated in accordance with these bylaws and as from time to time
may be assigned to him by the Board of Directors.
SECTION 6. If elected, the Chairman of the Board shall preside at
all meetings of the stockholders and of the Board of Directors; and he shall
have such other powers and duties as
<PAGE> 3
designated in these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 7. Unless the Board of Directors otherwise determines, the
President shall have the authority to agree upon and execute all leases,
contracts, evidences of indebtedness and other obligations in the name of the
Corporation; and, unless the Board of Directors otherwise determines, he shall,
in the absence of the Chairman of the Board and the chief executive officer or
if there be no Chairman of the Board or chief executive officer, preside at all
meetings of the stockholders and (should he be a director) of the Board of
Directors; and he shall have such other powers and duties as designated in
accordance with these bylaws and as from time to time may be assigned to him by
the Board of Directors.
SECTION 8. In the absence of the President, or in the event of his
inability or refusal to act, a Vice President designated by the Board of
Directors shall perform the duties of the President, and when so acting shall
have all the powers of and be subject to all the restrictions upon the
President. In the absence of a designation by the Board of Directors of a Vice
President to perform the duties of the President, or in the event of his
absence or inability or refusal to act, the Vice President who is present and
who is senior in terms of time as a Vice President of the Corporation shall so
act. The Vice Presidents shall perform such other duties and have such other
powers as the Board of Directors may from time to time prescribe.
SECTION 9. The Treasurer shall have responsibility for the custody
and control of all the funds and securities of the Corporation, and he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors. He shall
perform all acts incident to the position of Treasurer, subject to the control
of the chief executive officer and the Board of Directors; and he shall, if
required by the Board of Directors, give such bond for the faithful discharge
of his duties in such form as the Board of Directors may require.
SECTION 10. Each Assistant Treasurer shall have the usual powers and
duties pertaining to his office, together with such other powers and duties as
designated in these bylaws and as from time to time may be assigned to him by
the chief executive officer or the Board of Directors. The Assistant
Treasurers shall exercise the powers of the Treasurer during that officer's
absence or inability or refusal to act.
SECTION 11. The Secretary shall keep the minutes of all meetings of
the Board of Directors, committees of directors and the stockholders, in books
provided for that purpose; he shall attend to the giving and serving of all
notices; he may in the name of the Corporation affix the seal of the
Corporation to all contracts of the Corporation and attest the affixation of
the seal of the Corporation thereto; he may sign with the other appointed
officers all certificates for shares of capital stock of the Corporation; he
shall have charge of the certificate books, transfer books and stock ledgers,
and such other books and papers as the Board of Directors may direct, all of
which shall at all reasonable times be open to inspection of any director upon
application at the office of the Corporation during business hours; he shall
have such other powers and duties as designated in these bylaws and as from
time to time may be assigned to him by the Board of Directors; and he shall in
general perform all acts incident to the office of Secretary, subject to the
control of the chief executive officer and the Board of Directors.
<PAGE> 4
SECTION 12. Each Assistant Secretary shall have the usual powers and
duties pertaining to his office, together with such other powers and duties as
designated in these bylaws and as from time to time may be assigned to him by
the chief executive officer or the Board of Directors. The Assistant
Secretaries shall exercise the powers of the Secretary during that officer's
absence or inability or refusal to act.
SECTION 13. Unless otherwise directed by the Board of Directors, the
chief executive officer shall have power to vote and otherwise act on behalf of
the Corporation, in person or by proxy, at any meeting of security holders of
or with respect to any action of security holders of any other corporation in
which this Corporation may hold securities and otherwise to exercise any and
all rights and powers which this Corporation may possess by reason of its
ownership of securities in such other corporation.
<PAGE> 1
EXHIBIT 4.1.6
================================================================================
COMMODORE MEDIA, INC., AS ISSUER,
THE PARTIES LISTED
ON THE SIGNATURE PAGES
HERETO AS GUARANTORS,
AS GUARANTORS,
AND
IBJ SCHRODER BANK & TRUST COMPANY, AS TRUSTEE
---------------------------------
AMENDMENT NO. 5
DATED AS OF FEBRUARY 28, 1997
TO THE
INDENTURE
DATED AS OF APRIL 21, 1995
----------------------
$76,808,000
13 1/4% SENIOR SUBORDINATED NOTES DUE 2003
================================================================================
<PAGE> 2
AMENDMENT NO. 5, dated as of February 28, 1997 ("Amendment No. 5"), to
the INDENTURE, dated as of April 21, 1995, as amended (the "Indenture"), among
COMMODORE MEDIA, INC., a Delaware corporation, as Issuer (the "Company"), the
parties listed on the signature pages hereto as Guarantors (each individually,
a "Guarantor" and collectively, the "Guarantors"), and IBJ SCHRODER BANK &
TRUST COMPANY, a New York banking corporation, as Trustee (the "Trustee").
Each party agrees for the benefit of the other parties and for the
equal and ratable benefit of the Holders of the Company's 13 1/4% Senior
Subordinated Notes due 2003 (the "Notes") to amend, pursuant to Section 8.01(4)
of the Indenture, the Indenture as follows:
1. Osborn Communications Corporation, a Delaware corporation and
a wholly owned subsidiary of the Company ("Osborn"), is a Restricted Subsidiary
acquired pursuant to Section 4.14(ii) of the Indenture. Osborn delivers
herewith the Guarantee attached as Exhibit A to this Amendment No. 5 pursuant
to the provisions set forth in Sections 4.14 and 10.04 of the Indenture
guaranteeing the obligations of the Company under the Indenture. For all
purposes of the Indenture, Osborn shall be deemed a party to the Indenture by
virtue of its execution of this Amendment No. 5 and the defined term the
"Guarantor" contained in Article 1.01 of the Indenture shall be deemed to
include Osborn.
2. Each of Atlantic City Broadcasting Corp., a Delaware
corporation, O.C.C., Inc., a Delaware corporation ("O.C.C."), Breadbasket
Broadcasting Corporation, a Delaware corporation, Southeast Radio Holding
Corp., a Delaware corporation ("Southeast"), Houndstooth Broadcasting
Corporation, a Delaware corporation, SNG Holdings, Inc., a Delaware corporation
("SNG"), Osborn Entertainment Enterprises Corporation, a Delaware corporation
("Osborn Entertainment"), Ameron Broadcasting Corporation, a Delaware
corporation, and Emerald City Broadcasting Corporation, a Delaware corporation,
is a wholly-owned subsidiary of Osborn and a Restricted Subsidiary acquired or
created pursuant to Section 4.14(ii) of the Indenture (collectively, the
"Osborn Subsidiaries"). Each of the Osborn Subsidiaries delivers herewith the
Guarantee attached as Exhibit A to this Amendment No. 5 pursuant to the
provisions set forth in Sections 4.14 and 10.04 of the Indenture guaranteeing
the obligations of the Company under the Indenture. For all purposes of the
Indenture, each of the Osborn Subsidiaries shall be deemed a party to the
Indenture by virtue of its execution of this Amendment No. 5 and the defined
term the "Guarantor" contained in Article 1.01 of the Indenture shall be deemed
to include each of the Osborn Subsidiaries.
3. Each of Orange Communications, Inc., a Delaware corporation,
Mountain Radio Corporation, a Delaware corporation, Ladner Communications
Holding Corp., a Delaware corporation ("Ladner"), RKZ Television, Inc., a
Delaware corporation, and Yellow Brick Radio Corporation, a Delaware
corporation, is a wholly-owned subsidiary of O.C.C. and a Restricted Subsidiary
acquired pursuant to Section 4.14(ii) of the Indenture (collectively, the
"O.C.C. Subsidiaries"). Each of the O.C.C. Subsidiaries delivers herewith the
Guarantee attached as Exhibit A to this Amendment No. 5 pursuant to the
provisions set forth in Sections 4.14 and 10.04 of the Indenture guaranteeing
the obligations of the Company under the Indenture. For all purposes of the
Indenture, each of the O.C.C. Subsidiaries shall be deemed a party to the
Indenture by virtue of its execution of this Amendment No. 5 and the defined
term the "Guarantor" contained in Article 1.01 of the Indenture shall be deemed
to include each of the O.C.C. Subsidiaries.
4. Each of Asheville Broadcasting Corp., a Delaware corporation,
Corkscrew Broadcasting Corporation, a Delaware corporation, Daytona Beach
Broadcasting Corp., a Delaware corporation, and Rainbow Broadcasting
Corporation, a Delaware corporation, is a wholly-owned subsidiary of Southeast
and a Restricted Subsidiary acquired pursuant to Section 4.14(ii) of the
Indenture (collectively, the "Southeast Subsidiaries"). Each of the Southeast
Subsidiaries delivers herewith the Guarantee attached as Exhibit A to this
Amendment No. 5 pursuant to the provisions set forth in Sections 4.14 and 10.04
of the Indenture guaranteeing the obligations of the Company under the
Indenture. For all purposes of the Indenture, each of
<PAGE> 3
the Southeast Subsidiaries shall be deemed a party to the Indenture by virtue
of its execution of this Amendment No. 5 and the defined term the "Guarantor"
contained in Article 1.01 of the Indenture shall be deemed to include each of
the Southeast Subsidiaries.
5. Each of Great American East, Inc., a North Carolina
corporation, Nelson Broadcasting Corporation, a Delaware corporation, and Short
Broadcasting Corporation, a Delaware corporation, is a wholly-owned subsidiary
of SNG and a Restricted Subsidiary acquired pursuant to Section 4.14(ii) of the
Indenture (collectively, the "SNG Subsidiaries"). Each of the SNG Subsidiaries
delivers herewith the Guarantee attached as Exhibit A to this Amendment No. 5
pursuant to the provisions set forth in Sections 4.14 and 10.04 of the
Indenture guaranteeing the obligations of the Company under the Indenture. For
all purposes of the Indenture, each of the SNG Subsidiaries shall be deemed a
party to the Indenture by virtue of its execution of this Amendment No. 5 and
the defined term the "Guarantor" contained in Article 1.01 of the Indenture
shall be deemed to include each of the SNG Subsidiaries.
6. Each of Music Hall Club, Inc., a West Virginia corporation,
and Jamboree in the Hills, Inc., a Delaware corporation, is a wholly-owned
subsidiary of Osborn Entertainment and a Restricted Subsidiary acquired
pursuant to Section 4.14(ii) of the Indenture (collectively, the "Osborn
Entertainment Subsidiaries"). Each of the Osborn Entertainment Subsidiaries
delivers herewith the Guarantee attached as Exhibit A to this Amendment No. 5
pursuant to the provisions set forth in Sections 4.14 and 10.04 of the
Indenture guaranteeing the obligations of the Company under the Indenture. For
all purposes of the Indenture, each of the Osborn Entertainment Subsidiaries
shall be deemed a party to the Indenture by virtue of its execution of this
Amendment No. 5 and the defined term the "Guarantor" contained in Article 1.01
of the Indenture shall be deemed to include each of the Osborn Entertainment
Subsidiaries.
7. Each of Beatrice Broadcasting Corp., a Delaware corporation,
Currey Broadcasting Corporation, a Delaware corporation, Osborn Sound and
Communications Corp., a Delaware corporation, and Waite Broadcasting Corp., a
Delaware corporation, is a wholly-owned subsidiary of Ladner and a Restricted
Subsidiary acquired pursuant to Section 4.14(ii) of the Indenture
(collectively, the "Ladner Subsidiaries"). Each of the Ladner Subsidiaries
delivers herewith the Guarantee attached as Exhibit A to this Amendment No. 5
pursuant to the provisions set forth in Sections 4.14 and 10.04 of the
Indenture guaranteeing the obligations of the Company under the Indenture. For
all purposes of the Indenture, each of the Ladner Subsidiaries shall be deemed
a party to the Indenture by virtue of its execution of this Amendment No. 5 and
the defined term the "Guarantor" contained in Article 1.01 of the Indenture
shall be deemed to include each of the Ladner Subsidiaries.
8. This Amendment No. 5 supplements the Indenture and shall be a
part and subject to all the terms thereof. Except as supplemented hereby, the
Indenture and the Securities issued thereunder shall continue in full force and
effect.
9. This Amendment No. 5 may be executed in counterparts, each of
which shall be deemed an original, but all of which shall together constitute
one and the same instrument.
10. THIS AMENDMENT NO. 5 SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO
THE CONFLICT OF LAWS PRINCIPLES THEREOF).
11. The Trustee shall not be responsible for any recital herein as
such recitals shall be taken as statements of the Company, or the validity of
the execution by the Guarantors of this Amendment No. 5. The Trustee makes no
representation as to the validity or sufficiency of this Amendment No. 5.
-3-
<PAGE> 4
IN WITNESS WHEREOF, the parties have caused this Amendment No. 5 to
the Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the date and year first written above.
COMMODORE MEDIA, INC.
By:
------------------------------
James T. Shea, Jr.
President
ATTEST:
- -----------------------------
James J. Sullivan
Chief Financial Officer
GUARANTORS:
COMMODORE HOLDINGS, INC.
COMMODORE MEDIA OF DELAWARE, INC
COMMODORE MEDIA OF PENNSYLVANIA, INC.
COMMODORE MEDIA FLORIDA, INC.
COMMODORE MEDIA OF KENTUCKY, INC.
COMMODORE MEDIA OF NORWALK, INC.
COMMODORE MEDIA OF WESTCHESTER, INC.
DANBURY BROADCASTING, INC.
By:
----------------------------------
James T. Shea, Jr.
President
ATTEST:
- ----------------------------
James J. Sullivan
Chief Financial Officer
and Secretary
<PAGE> 5
OSBORN COMMUNICATIONS CORPORATION
ATLANTIC CITY BROADCASTING CORP.
O.C.C., INC.
BREADBASKET BROADCASTING CORPORATION
SOUTHEAST RADIO HOLDING CORP.
HOUNDSTOOTH BROADCASTING CORPORATION
SNG HOLDINGS, INC.
OSBORN ENTERTAINMENT ENTERPRISES
CORPORATION
ORANGE COMMUNICATIONS, INC.
MOUNTAIN RADIO CORPORATION
LADNER COMMUNICATIONS HOLDING CORP.
RKZ TELEVISION, INC.
YELLOW BRICK RADIO CORPORATION
ASHEVILLE BROADCASTING CORP.
CORKSCREW BROADCASTING CORPORATION
DAYTONA BEACH BROADCASTING CORP.
RAINBOW BROADCASTING CORPORATION
GREAT AMERICAN EAST, INC.
NELSON BROADCASTING CORPORATION
SHORT BROADCASTING CORPORATION
JAMBOREE IN THE HILLS, INC.
MUSIC HALL CLUB, INC.
BEATRICE BROADCASTING CORP.
CURREY BROADCASTING CORPORATION
OSBORN SOUND AND COMMUNICATIONS CORP.
WAITE BROADCASTING CORP.
AMERON BROADCASTING CORPORATION
EMERALD CITY BROADCASTING CORPORATION
By:
---------------------------------
Thomas S. Douglas
Vice President, Chief Financial Officer and Treasurer
ATTEST:
- -------------------------
Michael F. Mangan
Vice President, Controller and Secretary
IBJ SCHRODER BANK & TRUST COMPANY,
as Trustee
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
ATTEST:
- ----------------------------------
Name:
-----------------------------
Title:
----------------------------
<PAGE> 6
GUARANTEE
Each Guarantor (the "Guarantor," which term includes any successor
Person under the Indenture, dated April 21, 1995, as amended, among Commodore
Media, Inc. and its subsidiaries and IBJ Schroder Bank & Trust Company (the
"Indenture")) has unconditionally guaranteed, on a senior subordinated basis,
jointly and severally, to the extent set forth in the Indenture and subject to
the provisions of the Indenture, (a) the due and punctual payment of the
principal of and interest on the Notes, whether at maturity, by acceleration or
otherwise, the due and punctual payment of interest on overdue principal, and,
to the extent permitted by law, interest, and the due and punctual performance
of all other obligations of the Company to the Noteholders or the Trustee all
in accordance with the terms set forth in Article 10 of the Indenture, and (b)
in case of any extension of time of payment or renewal of any Notes or any of
such other obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise.
The obligations of each Guarantor to the Noteholders and to the
Trustee pursuant to this Guarantee and the Indenture are expressly set forth in
Article 10 of the Indenture and reference is hereby made to the Indenture for
the precise terms of this Guarantee. Terms used and not defined herein shall
have the meaning set forth in the Indenture.
GUARANTORS:
----------
OSBORN COMMUNICATIONS CORPORATION
ATLANTIC CITY BROADCASTING CORPORATION
O.C.C., INC.
BREADBASKET BROADCASTING CORPORATION
SOUTHEAST RADIO HOLDING CORPORATION
HOUNDSTOOTH BROADCASTING CORPORATION
SNG HOLDINGS, INC.
OSBORN ENTERTAINMENT ENTERPRISES
CORPORATION
ORANGE COMMUNICATIONS, INC.
MOUNTAIN RADIO CORPORATION
LADNER COMMUNICATIONS, HOLDING
CORPORATION
RKZ TELEVISION, INC.
YELLOW BRICK RADIO CORPORATION
ASHEVILLE BROADCASTING CORPORATION
CORKSCREW BROADCASTING CORPORATION
DAYTONA BEACH BROADCASTING CORPORATION
RAINBOW BROADCASTING CORPORATION
GREAT AMERICAN EAST, INC.
NELSON BROADCASTING CORPORATION
SHORT BROADCASTING CORPORATION
JAMBOREE IN THE HILLS, INC.
MUSIC HALL CLUB, INC.
BEATRICE BROADCASTING CORPORATION
CURREY BROADCASTING CORPORATION
OSBORN SOUND AND COMMUNICATIONS
CORPORATION
WAITE BROADCASTING CORPORATION
By:
-----------------------------------------
Name: Frank D. Osborn
Title: President and Chief Executive Officer
<PAGE> 1
EXHIBIT 10.9.4
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into
as of the 20th day of February, 1997 by and between Osborn Communications
Corporation, a Delaware corporation (together with its successors and assigns
permitted hereunder, the "Company"), and Frank D. Osborn (the "Executive").
WHEREAS, OCC Acquisition Company, Inc., a Delaware corporation,
("Mergeco"), that is a wholly-owned subsidiary of Commodore Media, Inc., a
Delaware corporation ("Holding Corp"), will merge with and into the Company,
whereby the Company will become a wholly-owned subsidiary of Holding Corp (the
"Merger");
WHEREAS, it is a condition to Mergeco's obligation to consummate the
Merger that the Company enter into this Agreement with the Executive; and
WHEREAS, the Board of Directors of the Company (the "Board") has
determined that it is in the best interests of the Company and its stockholders
to employ the Executive on the terms and conditions set forth herein.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. Subject to Section 3, the Company hereby
agrees to employ the Executive, and the Executive hereby agrees to be employed
by the Company, in accordance with the terms and provisions of this Agreement,
for the period commencing on the effective date of the Merger (the "Effective
Date") and ending on the fifth anniversary of such date (the "Employment
Period"); provided, however, that commencing on such fifth anniversary and on
each anniversary thereafter, the Employment Period shall automatically be
extended for one additional year unless at least six months prior to such
anniversary (but no more than 12 months prior to such anniversary), the Company
or the Executive shall have given written notice that it or he, as applicable,
does not wish to extend this Agreement (a "Non-Renewal Notice"). The term
"Employment Period" as utilized in this Agreement shall refer to the Employment
Period as so automatically extended.
2. Terms of Employment.
(a) Position and Duties.
(i) During the term of the Executive's
employment, the Executive shall serve as President and Chief Executive Officer
of the Company and, in so doing, shall report to the Board. The Executive
shall have supervision and control over, and responsibility for, such
management and operational functions of the Company currently assigned to such
position, and shall
<PAGE> 2
have such other powers and duties (including holding officer positions with one
or more subsidiaries of the Company) as may from time to time be prescribed by
the Board, so long as such powers and duties are reasonable and customary for
the President and Chief Executive Officer of an enterprise comparable to the
Company.
(ii) During the term of the Executive's
employment, and excluding any periods of vacation and sick leave to which the
Executive is entitled, the Executive agrees to devote full business time to the
business and affairs of the Company and, to the extent necessary to discharge
the responsibilities assigned to the Executive hereunder, to use the
Executive's reasonable best efforts to perform faithfully, effectively and
efficiently such responsibilities. During the term of Executive's employment
it shall not be a violation of this Agreement for the Executive to (A) serve on
corporate, civic or charitable boards or committees, (B) deliver lectures or
fulfill speaking engagements and (C) manage personal investments, so long as
such activities do not significantly interfere with the performance of the
Executive's responsibilities as an employee of the Company in accordance with
this Agreement.
(b) Compensation.
(i) Base Salary. During the term of the
Executive's employment, the Executive shall receive an annual base salary
("Annual Base Salary"), which shall be paid in accordance with the customary
payroll practices of the Company, at least equal to $375,000. Commencing on
January 1, 1998, and on each subsequent January 1 as long as the Executive
remains an employee of the Company (each such January 1 being herein referred
to as an "Adjustment Date"), the Annual Base Salary of the Executive shall be
adjusted to reflect increases in the Consumer Price Index for Urban Wage
Earners and Clerical Workers for the New York metropolitan area (1967 = 100),
published by the Bureau of Labor Statistics, United States Department of Labor
(the "Index"). On each Adjustment Date, the Executive's Annual Base Salary
shall be increased by a percentage of the Annual Base Salary for the prior
calendar year equal to the percentage increase in the Index for the prior
calendar year. The result of such calculation shall constitute the Executive's
Annual Base Salary, as adjusted, commencing on the Adjustment Date then at hand
and continuing until the next Adjustment Date. If (A) the Index ceases using
the 1967 average of 100 as the basis of calculation, (B) a significant change
is made in the number or nature (or both) of items used in determining the
Index, or (C) the Index is discontinued for any reason, then the Company and
the Executive shall, in good faith, agree upon a substitute Index or procedure
which reasonably reflects and monitors the salaries of urban wage earners and
clerical workers in the New York metropolitan area. Any increase in Annual
Base Salary shall not serve to limit or reduce any other obligation to the
Executive under this Agreement. The term Annual Base Salary as utilized in
this Agreement shall refer to Annual Base Salary as so increased.
(ii) Bonuses. In addition to Annual Base Salary,
the Executive shall be awarded during the term of the Executive's employment
such bonuses (each a "Bonus"), if any, as shall be determined by the Board
consistent with its practices for executive officers of the Company. In
addition to any Bonus, the Executive shall receive on the first day of the
first calendar month after
<PAGE> 3
the date of this Agreement and on the first day of each calendar month
thereafter for a period of 60 months (including the first payment date) a
guaranteed bonus (each a "Guaranteed Bonus") equal to $25,000.
(iii) Incentive, Savings and Retirement Plans.
During the term of the Executive's employment, the Executive shall be entitled
to participate in all incentive, savings and retirement plans, practices,
policies and programs applicable generally to other executives of the Company
("Investment Plans").
(iv) Welfare Benefit Plans. During the term of
the Executive's employment, the Executive and/or the Executive's family, as the
case may be, shall be eligible for participation in and shall receive all
benefits under welfare benefit plans, practices, policies and programs
("Welfare Plans") provided by the Company (including, without limitation,
medical, prescription, dental, disability, salary continuance, employee life,
group life, accidental death and travel accident insurance plans and programs)
to the extent applicable generally to other executives of the Company.
(v) Non-qualified Stock Options. In addition to
any benefits the Executive may receive pursuant to paragraph 2(b)(iii), Capstar
Broadcasting Partners, Inc., a Delaware corporation ("Capstar"), will grant
Executive non-qualified stock options (the "Executive Options") exercisable for
1,500,000 shares of common stock, par value $0.01 per share ("Common Stock"),
of Capstar. The Executive Options shall be granted under Capstar's 1996 Stock
Option Plan, as amended (the "Stock Option Plan"). The exercise price per
share for the Executive Options and, except as otherwise provided in Section 4
and subject to any further limitations set forth in the Stock Option Plan, the
vesting period shall be as set forth in the option agreement by and between the
Executive and Capstar entered into as of even date herewith. Except as
otherwise provided in Section 4, the Executive Options shall be exercisable
until 5:00 p.m., Dallas, Texas time, on the sixth anniversary of the Effective
Date at which time they shall expire.
(vi) Perquisites. During the term of the
Executive's employment, the Executive shall be entitled to receive (in addition
to the benefits described above) such perquisites and fringe benefits
appertaining to his position in accordance with any practice established by the
Board.
(vii) Expenses. During the term of the Executive's
employment, the Executive shall be entitled to receive prompt reimbursement for
all reasonable employment expenses incurred by the Executive in accordance with
the policies, practices and procedures of the Company.
(viii) Vacation and Holidays. During the term of
the Executive's employment, the Executive shall be entitled to paid vacation
and paid holidays in accordance with the plans, policies, programs and
practices of the Company for its executive officers.
3
<PAGE> 4
(ix) Signing Bonus. On the date hereof, the
Company shall pay the Executive a signing bonus equal to $300,000.
3. Termination of Employment.
(a) Death or Disability. The Executive's employment
shall terminate automatically upon the Executive's death during the Employment
Period. If the Disability of the Executive has occurred during the Employment
Period (pursuant to the definition of Disability set forth below), the Company
may give to the Executive written notice in accordance with Section 11(b) of
its intention to terminate the Executive's employment. In such event, the
Executive's employment with the Company shall terminate effective on the 30th
day after receipt of such notice by the Executive (the "Disability Effective
Date"), provided that, within the 30 days after such receipt, the Executive
shall not have returned to full-time performance of the Executive's duties.
For purposes of this Agreement, "Disability" shall mean the Executive's
inability to perform his duties and obligations hereunder for a period of 180
consecutive days due to mental or physical incapacity as determined by a
physician selected by the Company or its insurers and acceptable to the
Executive or the Executive's legal representative (such agreement as to
acceptability not to be withheld unreasonably).
(b) Cause or Board Termination. The Company may
terminate the Executive's employment during the Employment Period for Cause or
without Cause. For purposes of this Agreement, "Cause" shall mean (i) a breach
by the Executive of the Executive's obligations under Section 2(a) (other than
as a result of physical or mental incapacity) which constitutes a continued
material nonperformance by the Executive of his obligations and duties
thereunder, as determined by the Board, and which is not remedied within 30
days after receipt of written notice from the Company specifying such breach,
(ii) commission by the Executive of an act of fraud upon, or willful misconduct
toward, the Company, as reasonably determined by a majority of the
disinterested members of the Board (neither the Executive nor members of his
family being deemed disinterested for this purpose) after a hearing by the
Board following ten days' notice to the Executive of such hearing, (iii) a
material breach by the Executive of Section 6 or Section 9, (iv) the conviction
of the Executive of any felony (or a plea of nolo contendere thereto); or (v)
the failure of the Executive to carry out, or comply with, in any material
respect any directive of the Board consistent with the terms of this Agreement,
which is not remedied within 30 days after receipt of written notice from the
Company specifying such failure. For purposes of this Agreement, a "Board
Determination" shall mean a determination by the Board (which is evidenced by
one or more written resolutions to such effect) (i) to terminate the
Executive's employment during the Employment Period based upon the Board's
dissatisfaction with the manner in which the Executive has performed his
obligations and duties under Section 2(a) and (ii) that Cause does not exist as
a basis for such termination. For purposes of this Agreement, "without Cause"
shall mean a termination by the Company of the Executive's employment during
the Employment Period pursuant to a Board Determination or for any other reason
other than a termination based upon Cause, death or Disability.
4
<PAGE> 5
(c) Good Reason. The Executive's employment may be
terminated during the Employment Period by the Executive for Good Reason or
without Good Reason; provided, however, that the Executive agrees not to
terminate his employment for Good Reason unless (i) the Executive has given the
Company at least 30 days' prior written notice of his intent to terminate his
employment for Good Reason, which notice shall specify the facts and
circumstances constituting Good Reason, and (ii) the Company has not remedied
such facts and circumstances constituting Good Reason within such 30- day
period. For purposes of this Agreement, "Good Reason" shall mean:
(i) the assignment to the Executive of any duties
inconsistent in any respect with the Executive's position (including status,
offices, titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section 2(a) or any other action by the
Company which results in a material diminution in such position, authority,
duties or responsibilities, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith and which is
remedied by the Company promptly after receipt of notice thereof given by the
Executive (without limiting the foregoing, the Company and the Executive agree
that the delegation of the authority, duties or responsibilities of the
Executive to another person or persons, including any committee, shall be
deemed to be an action by the Company which results in a material diminution in
the Executive's position, authority, duties, or responsibilities as
contemplated by Section 2(a)), provided, however, that Good Reason may not be
asserted by the Executive under this clause (i) of Section 3(c) after a
Non-Renewal Notice has been given by either the Company or the Executive;
(ii) any termination or material reduction of a
material benefit under any Investment Plan or Welfare Plan in which the
Executive participates unless (A) there is substituted a comparable benefit
that is economically substantially equivalent to the terminated or reduced
benefit prior to such termination or reduction or (B) benefits under such
Investment Plan or Welfare Plan are terminated or reduced with respect to all
employees previously granted benefits thereunder;
(iii) any failure by the Company to comply with any
of the provisions of Section 2(b), other than an isolated, insubstantial and
inadvertent failure not occurring in bad faith and which is remedied by the
Company promptly after receipt of notice thereof given by the Executive;
(iv) any failure by the Company to comply with and
satisfy Section 8(c), provided that such successor has received at least ten
days prior written notice from the Company or the Executive of the requirements
of Section 8(c);
(v) prior to the termination of the Executive for
Cause, the Executive's ceasing to be a director of the Company for any reason
other than his death, Disability or voluntary resignation;
5
<PAGE> 6
(vi) the relocation or transfer of the Executive's
principal office to a location more than 75 miles from the Company's current
executive offices set forth in Section 11(b) hereof; or
(vii) without limiting the generality of the
foregoing, any material breach by the Company or any of its subsidiaries or
other affiliates (as defined below) of (A) this Agreement or (B) any other
agreement between the Executive and the Company or any such subsidiary or other
affiliate.
As used in this Agreement, "affiliate" means, with respect to a
person, any other person controlling, controlled by or under common control
with the first person; the term "control," and correlative terms, means the
power, whether by contract, equity ownership or otherwise, to direct the
policies or management of a person; and "person" means an individual,
partnership, corporation, limited liability company, trust or unincorporated
organization, or a government or agency or political subdivision thereof.
(d) Notice of Termination. Any termination by the
Company for Cause or without Cause, or by the Executive for Good Reason or
without Good Reason, shall be communicated by Notice of Termination to the
other party hereto given in accordance with Section 11(b). For purposes of
this Agreement, a "Notice of Termination" means a written notice which (i)
indicates the specific termination provision in this Agreement relied upon,
(ii) to the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) if the Date of
Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall not be more than 15
days after the giving of such notice). The failure by the Executive or the
Company to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason, Cause or a termination made
pursuant to a Board Determination shall not waive any right of the Executive or
the Company hereunder or preclude the Executive or the Company from asserting
such fact or circumstance in enforcing the Executive's or the Company's rights
hereunder.
(e) Date of Termination. "Date of Termination" means (i)
if the Executive's employment is terminated by the Company for Cause or
pursuant to a Board Determination, or by the Executive for Good Reason or
without Good Reason, the date of receipt of the Notice of Termination or any
later date specified therein pursuant to Section 3(d), as the case may be, (ii)
if the Executive's employment is terminated by the Company other than for Cause
or pursuant to a Board Determination, the date on which the Company notifies
the Executive of such termination and (iii) if the Executive's employment is
terminated by reason of death or Disability, the date of death of the Executive
or the Disability Effective Date, as the case may be.
6
<PAGE> 7
4. Obligations of the Company upon Termination.
(a) Good Reason; Other Than for Cause, Death or
Disability. If, during the Employment Period, the Company shall terminate the
Executive's employment other than for either Cause or Disability or the
Executive shall terminate his employment for Good Reason, and the termination
of the Executive's employment in any case is not due to his death or
Disability:
(i) The Company shall pay to the Executive (A) in
a lump sum in cash within ten days after the Date of Termination the aggregate
of the following amounts: (1) the sum of the Executive's Annual Base Salary
through the Date of Termination to the extent not theretofore paid and any
compensation previously deferred by the Executive (together with any accrued
interest or earnings thereon) and any accrued vacation pay ("Accrued
Obligations"); and (2) any amount arising from Executive's participation in, or
benefits under, any Investment Plans ("Accrued Investments"), which amounts
shall be payable in accordance with the terms and conditions of such Investment
Plans; (B) in regular installments in accordance with the customary payroll
practices of the Company (x) if the remainder of the Employment Period is 24
months or less, the Executive's then current Annual Base Salary for the
remainder of the Employment Period, (y) if the remainder of the Employment
Period is more than 24 months but less than 36 months, the sum of two times the
Executive's then current Annual Base Salary plus, in recognition of the
Executive's longer term of Non- Competition (as defined in Section 9), the
Executive's then current Annual Base Salary for the remainder of the Employment
Period after 24 months have expired from the Date of Termination, or (z) if the
remainder of the Employment Period is more than 36 months, the sum of two times
the Executive's then current Annual Base Salary plus, in recognition of the
Executive's longer term of Non-Competition, the Executive's then current Annual
Base Salary for a period of 12 months after 24 months have expired from the
Date of Termination; and (C) his Guaranteed Bonus as provided in Section
2(b)(ii) hereof as though the Executive had not been terminated.
Notwithstanding paragraph (B) of the immediately preceding sentence, if the
Company failed to achieve at least 60% of the Company's annual budget for
operating profit for the last calendar year ended prior to the termination of
the Executive (whether by the Company other than for either Cause or Disability
or by the Executive for Good Reason), then the Company shall only be obligated
to pay to the Executive, in regular installments in accordance with the
customary payroll practices of the Company, the Executive's then current Annual
Base Salary for a period of 12 months, and shall not be obligated to pay the
Executive any additional compensation in consideration of the term of
Non-Competition.
(ii) Notwithstanding the terms or conditions of
any stock option, stock appreciation right or similar agreements between the
Company and the Executive, the Executive shall vest, as of the Date of
Termination, in all rights under such agreements (i.e., stock options that
would otherwise vest after the Date of Termination) and thereafter shall be
permitted to exercise any and all such rights until the earlier to occur of (x)
the expiration of such stock option, stock appreciation right or similar
agreement pursuant to its terms or (y) 5:00 p.m., Dallas, Texas time, on the
90th day after the Date of Termination; provided, however, the provisions of
this clause (ii) of
7
<PAGE> 8
this Section 4(a) shall not apply to a termination of the Executive's
employment during the Employment Period that is made by the Company pursuant to
a Board Determination.
(iii) Except as otherwise provided in Section 4(e), the
Executive (and members of his family) shall be entitled to continue their
participation in the Company's Welfare Plans for a period of 24 months from the
Date of Termination; provided, however, that if the Company failed to achieve
at least 60% of the Company's annual budget for operating profit for the last
calendar year ended prior to the termination of the Executive (whether by the
Company other than for either Cause or Disability or by the Executive for Good
Reason), then the Executive (and members of his family) shall only be entitled
to participate in the Company's Welfare Plans for a period of 12 months from
the Date of Termination.
(b) Death. If the Executive's employment is terminated
by reason of the Executive's death during the Employment Period, the Company
shall pay to his legal representatives (i) in a lump sum in cash within ten
days after the Date of Termination the Accrued Obligations and (ii) the
Accrued Investments (which shall be payable in accordance with the terms and
conditions of the Investment Plans). In addition, except as otherwise provided
in Section 4(e), the members of the Executive's family shall be entitled to
continue their participation in the Company's Welfare Plans for a period of 12
months after the Date of Termination. Further, the Company also shall pay to
the Executive's legal representatives the Executive's Guaranteed Bonus as
provided in Section 2(b)(ii) hereof. Further, notwithstanding the terms or
conditions of any stock option, stock appreciation right or similar agreements
between the Company and the Executive, the Executive shall vest, as of the Date
of Termination, in all rights under such agreements (i.e., stock options that
would otherwise vest after the Date of Termination) and thereafter his legal
representatives shall be permitted to exercise any and all such rights until
the earlier to occur of (x) the expiration of such stock option, stock
appreciation right or similar agreement pursuant to its terms or (y) the first
anniversary of the Date of Termination. The Company shall have no further
payment obligations to the Executive or his legal representatives under this
Agreement.
(c) Disability. If the Executive's employment is
terminated by reason of the Executive's Disability during the Employment
Period, the Company shall have no further payment obligations to the Executive
or his legal representatives under this Agreement, other than for payment of
Accrued Obligations, Accrued Investments (which shall be payable in accordance
with the terms and conditions of the Investment Plans) and Guaranteed Bonus.
In addition, except as otherwise provided in Section 4(e), the Executive (and
members of his family) shall be entitled to continue their participation in the
Company's Welfare Plans for a period of 12 months after the Date of
Termination. Further, notwithstanding the terms or conditions of any stock
option, stock appreciation right or similar agreements between the Company and
the Executive, the Executive shall vest, as of the Date of Termination, in all
rights under such agreements (i.e., stock options that would otherwise vest
after the Date of Termination) and thereafter shall be permitted to exercise
any and all such rights until the earlier to occur of (x) the expiration of
such stock option, stock appreciation right or similar agreement pursuant to
its terms or (y) the first anniversary of the Date of Termination.
8
<PAGE> 9
(d) Cause; Other than for Good Reason. If the
Executive's employment shall be terminated by the Company for Cause or by the
Executive without Good Reason during the Employment Period, the Company shall
have no further payment obligations to the Executive other than for payment of
Accrued Obligations, Accrued Investments (which shall be payable in accordance
with the terms and conditions of the Investment Plans), and the continuance of
benefits under the Welfare Plans to the Date of Termination.
(e) If pursuant to the terms and provisions of the
Company's Welfare Plans the Executive (or members of his family) are not
eligible to participate in the Company's Welfare Plans because the Executive is
no longer an employee of the Company, then the Company may fulfill its
obligations under clause (iii) of Section 4(a), Section 4(b), or Section 4(c),
as applicable, by either providing to the Executive (or his legal
representatives), or reimbursing the Executive (or his legal representatives)
for the costs of, benefits substantially similar to the benefits provided by
the Company to its senior management under its Welfare Plans as such may from
time to time exist after the Date of Termination.
5. Full Settlement, Mitigation. In no event shall the Executive
be obligated to seek other employment or take any other action by way of
mitigation of the amounts payable to the Executive under any of the provisions
of this Agreement and such amounts shall not be reduced whether or not the
Executive obtains other employment. Neither the Executive nor the Company
shall be liable to the other party for any damages in addition to the amounts
payable under Section 4 arising out of the termination of the Executive's
employment prior to the end of the Employment Period; provided, however, that
the Company shall be entitled to seek damages for any breach of Sections 6, 7
or 9 or criminal misconduct.
6. Confidential Information.
(a) The Executive acknowledges that the Company and its
affiliates have trade, business and financial secrets and other confidential
and proprietary information (collectively, the "Confidential Information"). As
defined herein, Confidential Information shall not include (i) information that
is generally known to other persons or entities who can obtain economic value
from its disclosure or use and (ii) information required to be disclosed by the
Executive pursuant to a subpoena or court order, or pursuant to a requirement
of a governmental agency or law of the United States of America or a state
thereof or any governmental or political subdivision thereof; provided,
however, that the Executive shall take all reasonable steps to prohibit
disclosure pursuant to subsection (ii) above.
(b) The Executive agrees (i) to hold such Confidential
Information in confidence and (ii) not to release such information to any
person (other than Company employees and other persons to whom the Company has
authorized the Executive to disclose such information and then only to the
extent that such Company employees and other persons authorized by the Company
have a need for such knowledge).
9
<PAGE> 10
(c) The Executive further agrees not to use any
Confidential Information for the benefit of any person or entity other than the
Company.
7. Surrender of Materials Upon Termination. Upon any termination
of the Executive's employment, the Executive shall immediately return to the
Company all copies, in whatever form, of any and all Confidential Information
and other properties of the Company and its affiliates which are in the
Executive's possession, custody or control.
8. Successors.
(a) This Agreement is personal to the Executive and
without the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.
(b) This Agreement shall inure to the benefit of and be
binding upon the Company and, for the limited purposes set forth on the
signature page hereto, Capstar, and their respective successors and assigns.
(c) The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such
succession had taken place. As used in this Agreement, "Company" shall mean
the Company as hereinbefore defined and any successor to its business and/or
assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
(d) Capstar will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of Capstar to assume expressly
and agree to perform this Agreement in the same manner and to the same extent
that Capstar would be required to perform it if no such succession had taken
place. As used in this Agreement, "Capstar" shall mean Capstar as hereinbefore
defined and any successor to its business and/or assets as aforesaid which
assumes and agrees to perform this Agreement by operation of law, or otherwise.
9. Non-Competition.
(a) The term of Non-Competition (herein so called) shall
be for a term beginning on the date hereof and continuing until the first
anniversary of (i) the Date of Termination if the Executive's employment is
terminated by the Company for Cause or due to Disability or by the Executive
without Good Reason or (ii) the date of the last scheduled installment payment
to be made by the Company to the Executive pursuant to clause (B) of paragraph
4(a)(i) if the Executive's
10
<PAGE> 11
employment is terminated by the Company without Cause (and not due to
Disability) or by the Executive for Good Reason.
(b) During the term of Non-Competition, the Executive
will not (other than for the benefit of the Company pursuant to this Agreement)
directly or indirectly, individually or as an officer, director, employee,
shareholder, consultant, contractor, partner, joint venturer, agent, equity
owner or in any capacity whatsoever, (i) engage in any radio broadcasting
business that transmits a primary or city-grade signal within a Metro Survey
Area (as currently defined by The Arbitron Company in its Radio Markets
Reports) in which a station directly operated by the Company transmits a
primary or city-grade signal (A), with respect to the term of Non-Competition
that is during the Executive's employment, during such term of employment, and
(B), with respect to the term of Non-Competition that is after the term of the
Executive's employment, on the Date of Termination (all such areas being
collectively called the "Geographic Area") (a "Competing Business"), (ii) hire,
attempt to hire, or contact or solicit with respect to hiring any employee of
the Company, or (iii) divert or take away any customers or suppliers of the
Company in the Geographic Area. Notwithstanding the foregoing, the Company
agrees that the Executive may own less than five percent of the outstanding
voting securities of any publicly traded company that is a Competing Business
so long as the Executive does not otherwise participate in such competing
business in any way prohibited by the preceding clause. As used in this
Section 9(b) (and in Section 6), "Company" shall include the Company and any of
its subsidiaries.
(c) During the term of Non-Competition, the Executive
will not use the Executive's access to, knowledge of, or application of
Confidential Information to perform any duty for any Competing Business; it
being understood and agreed to that this Section 9(c) shall be in addition to
and not be construed as a limitation upon the covenants in Section 9(b) hereof.
(d) The Executive acknowledges that the geographic
boundaries, scope of prohibited activities, and time duration of the preceding
paragraphs are reasonable in nature and are no broader than are necessary to
maintain the confidentiality and the goodwill of the Company's proprietary
information, plans and services and to protect the other legitimate business
interests of the Company.
10. Effect of Agreement on Other Benefits. The existence of this
Agreement shall not prohibit or restrict the Executive's entitlement to full
participation in the executive compensation, employee benefit and other plans
or programs in which executives of the Company are eligible to participate.
11. Miscellaneous.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without reference to
principles of conflict of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect. Whenever the terms
"hereof", "hereby", "herein", or words of similar import are used in this
Agreement they shall
11
<PAGE> 12
be construed as referring to this Agreement in its entirety rather than to a
particular section or provision, unless the context specifically indicates to
the contrary. Any reference to a particular "Section" or "paragraph" shall be
construed as referring to the indicated section or paragraph of this Agreement
unless the context indicates to the contrary. The use of the term "including"
herein shall be construed as meaning "including without limitation." This
Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.
(b) All notices and other communications hereunder shall
be in writing and shall be given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to the Executive: Frank D. Osborn
174 Hemlock Hill Road
New Canaan, Connecticut 06840
If to the Company: c/o Capstar Broadcasting Partners, Inc.
600 Congress Avenue, Suite 1400
Austin, Texas 78701
Attention: General Counsel
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws effective during
the term of this Agreement, such provision shall be fully severable; this
Agreement shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a portion of this Agreement; and
the remaining provisions of this Agreement shall remain in full force and
effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance from this Agreement. Furthermore, in lieu of
such illegal, invalid or unenforceable provision there shall be added
automatically as part of this Agreement a provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible and be legal,
valid and enforceable.
(d) The Company agrees to attempt to obtain and maintain
a director's and officer's liability insurance policy during the term of the
Executive's employment covering the Executive on commercially reasonable terms,
and the amount of coverage shall be reasonable in relation to the Executive's
position and responsibilities hereunder; provided, however, that such coverage
may be reduced or eliminated to the extent that the Company reduces or
eliminates coverage for its directors and executives generally.
12
<PAGE> 13
(e) The Company may withhold from any amounts payable
under this Agreement such Federal, state or local taxes as shall be required to
be withheld pursuant to any applicable law or regulation.
(f) The Executive's or the Company's failure to insist
upon strict compliance with any provision of this Agreement or the failure to
assert any right the Executive or the Company may have hereunder, including,
without limitation, the right of the Executive to terminate employment for Good
Reason, shall not be deemed to be a waiver of such provision or right or any
other provision or right of this Agreement.
(g) The Executive acknowledges that money damages would
be both incalculable and an insufficient remedy for a breach of Section 6 or 9
by the Executive and that any such breach would cause the Company irreparable
harm. Accordingly, the Company, in addition to any other remedies at law or in
equity it may have, shall be entitled, without the requirement of posting of
bond or other security, to equitable relief, including injunctive relief and
specific performance, in connection with a breach of Section 6 or 9 by the
Executive.
(h) The provisions of this Agreement constitute the
complete understanding and agreement between the parties with respect to the
subject matter hereof.
(i) This Agreement may be executed in two or more counterparts.
(j) In the event any dispute or controversy arises under
this Agreement and is not resolved by mutual written agreement between the
Executive and the Company within 30 days after notice of the dispute is first
given, then, upon the written request of the Executive or the Company, such
dispute or controversy shall be submitted to arbitration to be conducted in
accordance with the rules of the American Arbitration Association. Judgment
may be entered thereon and the results of the arbitration will be binding and
conclusive on the parties hereto. Any arbitrator's award or finding or any
judgment or verdict thereon will be final and unappealable. All parties agree
that venue for arbitration will be in New York, New York, and that any
arbitration commenced in any other venue will be transferred to New York, New
York, upon the written request of any party to this Agreement. All
arbitrations will have three individuals acting as arbitrators: one arbitrator
will be selected by the Executive, one arbitrator will be selected by the
Company, and the two arbitrators so selected will select a third arbitrator.
Any arbitrator selected by a party will not be affiliated, associated or
related to the party selecting that arbitrator in any matter whatsoever. The
decision of the majority of the arbitrators will be binding on all parties.
The Company shall be responsible for paying its own and the Executive's
attorneys fees, costs and other expenses pertaining to any such arbitration and
enforcement regardless of whether an arbitrator's award or finding or any
judgment or verdict thereon is entered against the Executive. The Company
shall promptly (and in no event after ten days following its receipt from the
Executive of each written request therefor) reimburse the Executive for his
reasonable attorneys fees, costs and other expenses pertaining to any such
arbitration and the enforcement thereof.
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<PAGE> 14
(k) Section 6 and 9 of this Agreement shall survive the
termination of this Agreement.
[Remainder of page intentionally left blank]
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<PAGE> 15
IN WITNESS WHEREOF, the Executive has hereunto set the Executive's
hand and, pursuant to the authorization from the Board, the Company has caused
this Agreement to be executed in its name on its behalf, all as of the day and
year first above written.
EXECUTIVE
-----------------------------
Frank D. Osborn
OSBORN COMMUNICATIONS CORPORATION
-----------------------------
By:
--------------------------
Title:
-----------------------
Capstar Broadcasting Partners, Inc. hereby
joins in the execution and delivery of this
Agreement solely for the purposes of clause
(v) of Section 2(b), clause (ii) of Section
4(a) and Sections 4(b), 4(c) and 8(c).
CAPSTAR BROADCASTING PARTNERS, INC.
By:
--------------------------
Title:
----------------------
<PAGE> 1
EXHIBIT 10.25
INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT (the "Agreement") is made and entered
into as of this _____ day of _________, _______, by and between Osborn
Communications Corporation, a Delaware corporation (including any successors
thereto, the "Company"), and __________________ ("Indemnitee").
RECITALS:
A. Competent and experienced persons are reluctant to serve or to
continue to serve corporations as directors, officers, or in other capacities
unless they are provided with adequate protection through insurance or
indemnification (or both) against claims and actions against them arising out
of their service to and activities on behalf of those corporations.
B. The current uncertainties relating to the availability of
adequate insurance for directors and officers have increased the difficulty for
corporations to attract and retain competent and experienced persons.
C. The Board of Directors of the Company (the "Board") has
determined that the continuation of present trends in litigation will make it
more difficult to attract and retain competent and experienced persons, that
this situation is detrimental to the best interests of the Company's
stockholders, and that the Company should act to assure its directors and
officers that there will be increased certainty of adequate protection in the
future.
D. It is reasonable, prudent, and necessary for the Company to
obligate itself contractually to indemnify its directors and officers to the
fullest extent permitted by applicable law in order to induce them to serve or
continue to serve the Company.
E. Indemnitee is willing to serve and continue to serve the
Company on the condition that he be indemnified to the fullest extent permitted
by law.
F. Concurrently with the execution of this Agreement, Indemnitee
is agreeing to serve or to continue to serve as a director or officer of the
Company.
AGREEMENTS:
NOW, THEREFORE, in consideration of the foregoing premises,
Indemnitee's agreement to serve or continue to serve as a director or officer
of the Company, and the covenants contained in this Agreement, the Company and
Indemnitee hereby covenant and agree as follows:
<PAGE> 2
1. Certain Definitions:
For purposes of this Agreement:
(a) Affiliate: shall mean any Person that directly, or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with the Person specified.
(b) Change of Control: shall mean the occurrence of any
of the following events:
(i) The acquisition after the date of this
Agreement by any individual, entity, or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) (a "Person") of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 50% or more of either (A) the
then outstanding shares of common stock of the Company (the "Outstanding
Company Common Stock") or (B) the combined voting power of the then outstanding
voting securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); provided, however,
that for purposes of this paragraph (i), the following acquisitions shall not
constitute a Change of Control: (1) any acquisition directly from the Company
or any Subsidiary thereof, (2) any acquisition by the Company or any Subsidiary
thereof, (3) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any Subsidiary of the Company, or (4)
any acquisition by any one or more members of the HMC Group;
(ii) Individuals who, as of the date of this
Agreement, constitute the Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the date of this Agreement (A) who
is a member of the HMC Group or (B) whose election, or nomination for election
by the Company's stockholders, was approved by a vote of at least a majority of
the directors then comprising the Incumbent Board, shall in either case be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or
(iii) Consummation of a sale, lease, exchange, or
other disposition of all or substantially all of the assets of the Company
(including the capital stock or assets of its subsidiaries) to any Person,
other than one or more members of the HMC Group.
(c) Claim: shall mean any threatened, pending, or
completed action, suit, or proceeding (including, without limitation,
securities laws actions, suits, and proceedings and also any cross claim or
counterclaim in any action, suit, or proceeding), whether civil, criminal,
arbitral, administrative, or investigative in nature, or any inquiry or
investigation (including discovery),
<PAGE> 3
whether conducted by the Company or any other Person, that Indemnitee in good
faith believes might lead to the institution of any action, suit, or
proceeding.
(d) Expenses: shall mean all costs, expenses (including
attorneys' and expert witnesses' fees), and obligations paid or incurred in
connection with investigating, defending (including affirmative defenses and
counterclaims), being a witness in, or participating in (including on appeal),
or preparing to defend, be a witness in, or participate in, any Claim relating
to any Indemnifiable Event.
(e) HMC Group: shall mean Hicks, Muse, Tate & Furst
Incorporated, its Affiliates and their respective employees, officers, and
directors (and members of their respective families and trusts for the primary
benefit of such family members).
(f) Indemnifiable Event: shall mean any actual or
alleged act, omission, statement, misstatement, event, or occurrence related to
the fact that Indemnitee is or was a director, officer, agent, or fiduciary of
the Company, or is or was serving at the request of the Company as a director,
officer, trustee, agent, or fiduciary of another corporation, partnership,
joint venture, employee benefit plan, trust, or other enterprise, or by reason
of any actual or alleged thing done or not done by Indemnitee in any such
capacity. For purposes of this Agreement, the Company agrees that Indemnitee's
service on behalf of or with respect to any Subsidiary or employee benefits
plan of the Company or any Subsidiary of the Company shall be deemed to be at
the request of the Company.
(g) Indemnifiable Liabilities: shall mean all Expenses
and all other liabilities, damages (including, without limitation, punitive,
exemplary, and the multiplied portion of any damages), judgments, payments,
fines, penalties, amounts paid in settlement, and awards paid or incurred that
arise out of, or in any way relate to, any Indemnifiable Event.
(h) Potential Change of Control: shall be deemed to have
occurred if (i) the Company enters into an agreement, the consummation of which
would result in the occurrence of a Change of Control; (ii) any Person
(including the Company) publicly announces an intention to take or to consider
taking actions that, if consummated, would constitute a Change of Control; or
(iii) the Board adopts a resolution to the effect that, for purposes of this
Agreement, a Potential Change of Control has occurred.
(i) Reviewing Party: shall mean (i) a member or members
of the Board who are not parties to the particular Claim for which Indemnitee
is seeking indemnification or (ii) if a Change of Control has occurred and
Indemnitee so requests, or if the members of the Board so elect, or if all of
the members of the Board are parties to such Claim, Special Counsel.
(j) Special Counsel: shall mean special, independent
legal counsel selected by Indemnitee and approved by the Company (which
approval shall not be unreasonably withheld), and
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<PAGE> 4
who has not otherwise performed material services for the Company or for
Indemnitee within the last three years (other than as Special Counsel under
this Agreement or similar agreements).
(k) Subsidiary: shall mean, with respect to any Person,
any corporation or other entity of which a majority of the voting power of the
voting equity securities or equity interest is owned, directly or indirectly,
by that Person.
2. Indemnification and Expense Advancement.
(a) The Company shall indemnify Indemnitee and hold
Indemnitee harmless to the fullest extent permitted by law, as soon as
practicable but in any event no later than 30 days after written demand is
presented to the Company, from and against any and all Indemnifiable
Liabilities. Notwithstanding the foregoing, the obligations of the Company
under Section 2(a) shall be subject to the condition that the Reviewing Party
shall not have determined (in a written opinion, in any case in which Special
Counsel is involved) that Indemnitee is not permitted to be indemnified under
applicable law. Nothing contained in this Agreement shall require any
determination under this Section 2(a) to be made by the Reviewing Party prior
to the disposition or conclusion of the Claim against the Indemnitee.
(b) If so requested by Indemnitee, the Company shall
advance to Indemnitee all reasonable Expenses incurred by Indemnitee to the
fullest extent permitted by law (or, if applicable, reimburse Indemnitee for
any and all reasonable Expenses incurred by Indemnitee and previously paid by
Indemnitee) within ten business days after such request (an "Expense Advance").
The Company shall be obligated from time to time at the request of Indemnitee
to make or pay an Expense Advance in advance of the final disposition or
conclusion of any Claim. In connection with any request for an Expense Advance,
if requested by the Company, Indemnitee or Indemnitee's counsel shall submit an
affidavit stating that the Expenses to which the Expense Advances relate are
reasonable. Any dispute as to the reasonableness of any Expense shall not delay
an Expense Advance by the Company. If, when, and to the extent that the
Reviewing Party determines that (i) Indemnitee would not be permitted to be
indemnified with respect to a Claim under applicable law or (ii) the amount of
the Expense Advance was not reasonable, the Company shall be entitled to be
reimbursed by Indemnitee and Indemnitee hereby agrees to reimburse the Company
without interest (which agreement shall be an unsecured obligation of
Indemnitee) for (A) all related Expense Advances theretofore made or paid by
the Company in the event that it is determined that indemnification would not
be permitted or (B) the excessive portion of any Expense Advances in the event
that it is determined that such Expenses Advances were unreasonable, in either
case, if and to the extent such reimbursement is required by applicable law;
provided, however, that if Indemnitee has commenced legal proceedings in a
court of competent jurisdiction to secure a determination that Indemnitee could
be indemnified under applicable law, or that the Expense Advances were
reasonable, any determination made by the Reviewing Party that Indemnitee would
not be permitted to be indemnified under applicable law or that the Expense
Advances were unreasonable shall not be binding, and the Company shall be
obligated to continue to make Expense Advances, until a final
-4-
<PAGE> 5
judicial determination is made with respect thereto (as to which all rights of
appeal therefrom have been exhausted or lapsed), which determination shall be
conclusive and binding. If there has been a Change of Control, the Reviewing
Party shall be Special Counsel, if Indemnitee so requests. If there has been no
determination by the Reviewing Party or if the Reviewing Party determines that
Indemnitee substantively is not permitted to be indemnified in whole or part
under applicable law or that any Expense Advances were unreasonable, Indemnitee
shall have the right to commence litigation in any court in the states of Texas
or Delaware having subject matter jurisdiction thereof and in which venue is
proper seeking an initial determination by the court or challenging any such
determination by the Reviewing Party or any aspect thereof, and the Company
hereby consents to service of process and to appear in any such proceeding. Any
determination by the Reviewing Party otherwise shall be conclusive and binding
on the Company and Indemnitee.
(c) Nothing in this Agreement, however, shall require the
Company to indemnify Indemnitee with respect to any Claim initiated by
Indemnitee, other than a Claim solely seeking enforcement of the Company's
indemnification obligations to Indemnitee or a Claim authorized by the Board.
3. Change of Control. The Company agrees that, if there is a
Potential Change in Control or a Change of Control and if Indemnitee requests
in writing that Special Counsel be the Reviewing Party, then Special Counsel
shall be the Reviewing Party. In such a case, the Company agrees not to
request or seek reimbursement from Indemnitee of any indemnification payment or
Expense Advances unless Special Counsel has rendered its written opinion to the
Company and Indemnitee that the Company was not or is not permitted under
applicable law to indemnify Indemnitee or that such Expense Advances were
unreasonable. However, if Indemnitee has commenced legal proceedings in a
court of competent jurisdiction to secure a determination that Indemnitee could
be indemnified under applicable law or that the Expense Advances were
reasonable, any determination made by Special Counsel that Indemnitee would not
be permitted to be indemnified under applicable law or that the Expense
Advances were unreasonable shall not be binding, and the Company shall be
obligated to continue to make Expense Advances, until a final judicial
determination is made with respect thereto (as to which all rights of appeal
therefore have been exhausted or lapsed), which determination shall be
conclusive and binding. The Company agrees to pay the reasonable fees of
Special Counsel and to indemnify Special Counsel against any and all expenses
(including attorneys' fees), claims, liabilities, and damages arising out of or
relating to this Agreement or Special Counsel's engagement pursuant hereto.
4. Establishment of Trust. In the event of a Potential Change of
Control or a Change of Control, the Company shall, upon written request by
Indemnitee, create a trust for the benefit of Indemnitee (the "Trust") and from
time to time upon written request of Indemnitee shall fund the Trust in an
amount equal to all Indemnifiable Liabilities reasonably anticipated at the
time to be incurred in connection with any Claim. The amount to be deposited in
the Trust pursuant to the foregoing funding obligation shall be determined by
the Reviewing Party. The terms of the Trust shall provide that, upon a Change
of Control, (a) the Trust shall not be revoked or the principal
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<PAGE> 6
thereof invaded, without the written consent of Indemnitee; (b) the trustee of
the Trust shall advance, within ten business days of a request by Indemnitee,
any and all reasonable Expenses to Indemnitee (and Indemnitee hereby agrees to
reimburse the Trust under the circumstances in which Indemnitee would be
required to reimburse the Company for Expense Advances under this Agreement),
any required determination concerning the reasonableness of the Expenses to be
made by the Reviewing Party, (c) the Trust shall continue to be funded by the
Company in accordance with the funding obligation set forth above; (d) the
trustee of the Trust shall promptly pay to Indemnitee all amounts for which
Indemnitee shall be entitled to indemnification pursuant to this Agreement; and
(e) all unexpended funds in the Trust shall revert to the Company upon a final
determination by the Reviewing Party or a court of competent jurisdiction, as
the case may be, that Indemnitee has been fully indemnified under the terms of
this Agreement. The trustee of the Trust shall be chosen by Indemnitee, and
shall be an institution that is not affiliated with Indemnitee. Nothing in
this Section 4 shall relieve the Company of any of its obligations under this
Agreement.
5. Indemnification for Additional Expenses. The Company shall
indemnify Indemnitee against any and all costs and expenses (including
attorneys' and expert witnesses' fees) and, if requested by Indemnitee, shall
(within two business days of that request) advance those costs and expenses to
Indemnitee, that are incurred by Indemnitee if Indemnitee, whether by formal
proceedings or through demand and negotiation without formal proceedings: (a)
seeks to enforce Indemnitee's rights under this Agreement, (b) seeks to enforce
Indemnitee's rights to expense advancement or indemnification under any other
agreement or provision of the Company's Certificate of Incorporation (the
"Certificate of Incorporation") or Bylaws (the "Bylaws") now or hereafter in
effect relating to Claims for Indemnifiable Events, or (c) seeks recovery under
any directors' and officers' liability insurance policies maintained by the
Company, in each case regardless of whether Indemnitee ultimately prevails;
provided that a court of competent jurisdiction has not found Indemnitee's
claim for indemnification or expense advancements under the foregoing clauses
(a), (b) or (c) to be frivolous, presented for an improper purpose, without
evidentiary support, or otherwise sanctionable under Federal Rule of Civil
Procedure No. 11 or an analogous rule or law, and provided further, that if a
court makes such a finding, Indemnitee shall reimburse the Company for all
amounts previously advanced to Indemnitee pursuant to this Section 5. Subject
to the provisos contained in the preceding sentence, to the fullest extent
permitted by law, the Company waives any and all rights that it may have to
recover its costs and expenses from Indemnitee.
6. Partial Indemnity. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some, but not
all, of Indemnitee's Indemnifiable Liabilities, the Company shall indemnify
Indemnitee for the portion thereof to which Indemnitee is entitled.
7. Contribution.
(a) Contribution Payment. To the extent the
indemnification provided for under any provision of this Agreement is
determined (in the manner hereinabove provided) not to be permitted under
applicable law, the Company, in lieu of indemnifying Indemnitee, shall, to the
extent
-6-
<PAGE> 7
permitted by law, contribute to the amount of any and all Indemnifiable
Liabilities incurred or paid by Indemnitee for which such indemnification is
not permitted. The amount the Company contributes shall be in such proportion
as is appropriate to reflect the relative fault of Indemnitee, on the one hand,
and of the Company and any and all other parties (including officers and
directors of the Company other than Indemnitee) who may be at fault
(collectively, including the Company, the "Third Parties"), on the other hand.
(b) Relative Fault. The relative fault of the Third
Parties and the Indemnitee shall be determined (i) by reference to the relative
fault of Indemnitee as determined by the court or other governmental agency or
(ii) to the extent such court or other governmental agency does not apportion
relative fault, by the Reviewing Party after giving effect to, among other
things, the relative intent, knowledge, access to information, and opportunity
to prevent or correct the relevant events, of each party, and other relevant
equitable considerations. The Company and Indemnitee agree that it would not be
just and equitable if contribution were determined by pro rata allocation or by
any other method of allocation that does take account of the equitable
considerations referred to in this Section 7(b).
8. Burden of Proof. In connection with any determination by the
Reviewing Party or otherwise as to whether Indemnitee is entitled to be
indemnified under any provision of this Agreement or to receive contribution
pursuant to Section 7 of this Agreement, to the extent permitted by law the
burden of proof shall be on the Company to establish that Indemnitee is not so
entitled.
9. No Presumption. For purposes of this Agreement, the
termination of any Claim by judgment, order, settlement (whether with or
without court approval), or conviction, or upon a plea of nolo contendere, or
its equivalent, or an entry of an order of probation prior to judgment shall
not create a presumption (other than any presumption arising as a matter of law
that the parties may not contractually agree to disregard) that Indemnitee did
not meet any particular standard of conduct or have any particular belief or
that a court has determined that indemnification is not permitted by applicable
law.
10. Non-exclusivity. The rights of Indemnitee hereunder shall be
in addition to any other rights Indemnitee may have under the Bylaws or
Certificate of Incorporation or the Delaware General Corporation Law or
otherwise. To the extent that a change in the Delaware General Corporation Law
(whether by statute or judicial decision) permits greater indemnification by
agreement than would be afforded currently under this Agreement, it is the
intent of the parties hereto that Indemnitee shall enjoy by this Agreement the
greater benefits so afforded by that change. Indemnitee's rights under this
Agreement shall not be diminished by any amendment to the Certificate of
Incorporation or Bylaws, or of any other agreement or instrument to which
Indemnitee is not a party, and shall not diminish any other rights that
Indemnitee now or in the future has against the Company.
-7-
<PAGE> 8
11. Liability Insurance. Except as otherwise agreed to by the
Company and Indemnitee in a written agreement, to the extent the Company
maintains an insurance policy or policies providing directors' and officers'
liability insurance, Indemnitee shall be covered by that policy or those
policies, in accordance with its or their terms, to the maximum extent of the
coverage available for any Company director or officer.
12. Period of Limitations. No action, lawsuit, or proceeding may
be brought against Indemnitee or Indemnitee's spouse, heirs, executors, or
personal or legal representatives, nor may any cause of action be asserted in
any such action, lawsuit, or proceeding, by or on behalf of the Company, after
the expiration of two years after the statute of limitations commences with
respect to Indemnitee's act or omission that gave rise to the action, lawsuit,
proceeding, or cause of action; provided, however, that, if any shorter period
of limitations is otherwise applicable to any such action, lawsuit, proceeding,
or cause of action, the shorter period shall govern.
13. Amendments. No supplement, modification, or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of any provision of this Agreement shall be effective unless
in a writing signed by the party granting the waiver. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provisions hereof (whether or not similar) nor shall that waiver
constitute a continuing waiver.
14. Other Sources. Indemnitee shall not be required to exercise
any rights that Indemnitee may have against any other Person (for example,
under an insurance policy) before Indemnitee enforces his rights under this
Agreement. However, to the extent the Company actually indemnifies Indemnitee
or advances him Expenses, the Company shall be subrogated to the rights of
Indemnitee and shall be entitled to enforce any such rights which Indemnitee
may have against third parties. Indemnitee shall assist the Company in
enforcing those rights if it pays his costs and expenses of doing so. If
Indemnitee is actually indemnified or advanced Expenses by any third party,
then, for so long as Indemnitee is not required to disgorge the amounts so
received, to that extent the Company shall be relieved of its obligation to
indemnify Indemnitee or advance Indemnitee Expenses.
15. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors, assigns (including any direct or indirect successor by
merger or consolidation), spouses, heirs, and personal and legal
representatives. This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as an officer or director of the Company or
another enterprise at the Company's request.
16. Severability. If any provision of this Agreement is held to
be illegal, invalid, or unenforceable under present or future laws effective
during the term hereof, that provision shall be fully severable; this Agreement
shall be construed and enforced as if that illegal, invalid, or unenforceable
provision had never comprised a part hereof; and the remaining provisions shall
remain in full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance from this Agreement.
Furthermore, in lieu of that illegal, invalid, or unenforceable
-8-
<PAGE> 9
provision, there shall be added automatically as a part of this Agreement a
provision as similar in terms to the illegal, invalid, or unenforceable
provision as may be possible and be legal, valid, and enforceable.
17. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Delaware
applicable to contracts made and to be performed in that state without giving
effect to the principles of conflicts of laws.
18. Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
19. Notices. Whenever this Agreement requires or permits notice
to be given by one party to the other, such notice must be in writing to be
effective and shall be deemed delivered and received by the party to whom it is
sent upon actual receipt (by any means) of such notice. Receipt of a notice by
the Secretary of the Company shall be deemed receipt of such notice by the
Company.
20. Complete Agreement. This Agreement constitutes the complete
understanding and agreement among the parties with respect to the subject
matter hereof and supersedes all prior agreements and understandings between
the parties with respect to the subject matter hereof, other than any
indemnification rights that Indemnitee may enjoy under the Certificate of
Incorporation, the Bylaws, or the Delaware General Corporation Law.
21. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but in making proof
hereof it shall not be necessary to produce or account for more than one such
counterpart.
-9-
<PAGE> 10
EXECUTED as of the date first written above.
OSBORN COMMUNICATIONS
CORPORATION
By:
----------------------
Name:
--------------------
Title:
-------------------
INDEMNITEE
-------------------------
-------------------------
<PAGE> 1
EXHIBIT 10.31
$13,475,000
CREDIT AGREEMENT
AMONG
EMERALD CITY RADIO PARTNERS, L.P.,
AS BORROWER,
AND
COMMODORE MEDIA, INC.,
AS LENDER
DATED AS OF MARCH 14, 1997
<PAGE> 2
TABLE OF CONTENTS
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SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Other Definitional Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.1 Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.2 Procedure for Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.3 Repayment of the Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.4 Termination of the Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.5 Optional Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.6 Extension of Stated Maturity Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.7 Interest Rates and Payment Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.8 Computation of Interest and Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.9 Requirements of Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.10 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.11 Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.12 Interest Accrual for Income Tax Purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 3. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.1 Financial Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.2 No Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.3 Corporate Existence; Compliance with Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.4 Corporate Power; Authorization; Enforceable Obligations . . . . . . . . . . . . . . . . . . . . . . . . 14
3.5 No Legal Bar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.6 No Material Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.7 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.8 Ownership of Property; Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.9 Intellectual Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.10 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.11 Federal Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.12 Labor Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.13 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.14 Investment Company Act; Other Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.15 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.16 Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.17 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3.18 Accuracy of Information, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.19 Security Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.20 Solvency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
3.21 Regulation H . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
</TABLE>
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3.22 Compliance with Applicable Laws; FCC Matters; Station Licenses . . . . . . . . . . . . . . . . . . . . 19
SECTION 4. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.1 Conditions to the Extension of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 5. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.1 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.2 Certificates; Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.3 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.4 Conduct of Business and Maintenance of Existence, etc. . . . . . . . . . . . . . . . . . . . . . . . . 25
5.5 Maintenance of Property; Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.6 Inspection of Property; Books and Records; Discussions . . . . . . . . . . . . . . . . . . . . . . . . 25
5.7 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.8 Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
5.9 Additional Collateral, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 6. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.1 Limitation on Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.2 Limitation on Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.3 Limitation on Fundamental Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.4 Limitation on Sale of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.5 Limitation on Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.6 Limitation on Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.7 Limitation on Investments, Loans and Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.8 Limitation on Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.9 Limitation on Sales and Leasebacks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.10 Limitation on Changes in Fiscal Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.11 Limitation on Negative Pledge Clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.12 Limitation on Lines of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.13 Limitation on Amendments to Acquisition Documents . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 7. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 8. THE LENDER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
8.1 Delegation of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
8.2 Reliance by Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 9. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
9.1 Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
9.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
9.3 No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
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9.4 Survival of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
9.5 Payment of Expenses and Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
9.6 Successors and Assigns; Participations and Assignments . . . . . . . . . . . . . . . . . . . . . . . . 36
9.7 Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
9.8 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
9.9 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
9.10 Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
9.11 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
9.12 Submission To Jurisdiction; Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
9.13 Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
9.14 WAIVERS OF JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
9.15 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
9.16 FCC Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
9.17 INDEMNIFICATION AND WAIVER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
9.18 ENTIRE AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
9.19 Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
</TABLE>
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<PAGE> 5
SCHEDULES:
1.1A Mortgaged Property
3.4 Consents, Authorizations, Filings and Notices
3.6 Litigation
3.19(a) UCC Filing Jurisdictions
3.19(b) Mortgage Filing Jurisdictions
3.22 FCC Licenses and Matters
6.1(c) Existing Indebtedness
6.2(f) Existing Liens
EXHIBITS:
A Form of Guarantee and Collateral Agreement
B Form of Compliance Certificate
C Form of Closing Certificate
D Form of Mortgage
E Form of Legal Opinion of Hale and Dorr LLP
F Form of Note
- iv -
CREDIT AGREEMENT
CREDIT AGREEMENT, dated as of March 14, 1997, by and between EMERALD
CITY RADIO PARTNERS, L.P., a Delaware limited partnership ("Borrower") and
COMMODORE MEDIA, INC., a Delaware corporation (the "Lender").
The parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the following terms
shall have the following meanings:
"Asset Purchase Agreement" means that certain Asset Purchase Agreement
dated March 10, 1997, by and among the Borrower, as seller and WNOK Acquisition
Company, Inc., as purchaser, relating to the sale of all the assets and
licenses of the Stations.
"Affiliate": as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control
with, such Person. For purposes of this definition, "control" of a Person
means the power, directly or indirectly, either to (a) vote 51% or more of the
securities having ordinary voting power for the election of directors of such
Person or (b) direct or cause the direction of the management and policies of
such Person, whether by contract or otherwise.
"Agreement": this Credit Agreement, as amended, supplemented or
otherwise modified from time to time.
"Assignee": as defined in Section 9.6(c).
"Board": the Board of Governors of the Federal Reserve System of the
United States (or any successor).
"Business": as defined in Section 3.17.
"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
close.
"Capital Expenditures": for any period, with respect to any Person,
the aggregate of all expenditures by such Person and its Subsidiaries for the
acquisition or leasing (pursuant to a capital lease) of fixed or capital assets
or additions to equipment (including replacements, capitalized repairs and
improvements during such period) which should be capitalized under GAAP on a
consolidated balance sheet of such Person and its Subsidiaries.
"Capital Lease Obligations": as to any Person, the obligations of
such Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
1
<PAGE> 6
accounted for as capital leases on a balance sheet of such Person under GAAP
and, for the purposes of this Agreement, the amount of such obligations at any
time shall be the capitalized amount thereof at such time determined in
accordance with GAAP.
"Capital Stock": any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.
"Cash Equivalents": (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurodollar time deposits or overnight
bank deposits having maturities of six months or less from the date of
acquisition issued by any commercial bank organized under the laws of the
United States of America or any state thereof having combined capital and
surplus of not less than $500,000,000; and (c) commercial paper of an issuer
rated at least A-2 by Standard & Poor's Ratings Services or P-2 by Moody's
Investors Service, Inc., or carrying an equivalent rating by a nationally
recognized rating agency, if both of the two named rating agencies cease
publishing ratings of commercial paper issuers generally, and maturing within
six months from the date of acquisition.
"Closing Date": March 14, 1997.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral": all Property of the Loan Parties, now owned or
hereafter acquired, upon which a Lien is purported to be created by any
Security Document.
"Commitment": the obligation of the Lender to make the Loan to the
Borrower hereunder in a principal amount not to exceed $13,475,000.
"Commonly Controlled Entity": an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of Section
4001 of ERISA or is part of a group which includes the Borrower and which is
treated as a single employer under Section 414 of the Code.
"Communications Act" means the Communications Act of 1934, as amended,
and all material rules, regulations and written policies of the FCC thereunder.
"Compliance Certificate": a certificate duly executed by a
Responsible Officer substantially in the form of Exhibit B.
"Contractual Obligation": as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Default": any of the events specified in Section 8, whether or not
any requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
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"Discount Rate" means (i) on and before October 31, 1997, an interest
rate per annum equal to 6.00% and (ii) on and after November 1, 1997, an
interest rate per annum equal to 8.00%.
"Dollars" and "$": dollars in lawful currency of the United States of
America.
"Domestic Subsidiary": any Subsidiary of the Borrower organized under
the laws of any jurisdiction within the United States of America.
"Environmental Laws": any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of
Law (including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.
"Environmental Reports" means, collectively, the Preliminary
Environmental Evaluation WOIC-AM and WNOK-FM Radio Transmitter Sites, Columbia,
South Carolina dated December 18, 1989, prepared by Westinghouse Environmental
and Geotechnical Services, Inc and the Phase I (Modified) Environmental Site
Assessment Emerald City Radio Partners WOIC, WNOK and WMFX Radio Stations,
Columbia, South Carolina dated March 1997, prepared by International Technology
Corporation.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Event of Default": any of the events specified in Section 7,
provided that any requirement for the giving of notice, the lapse of time, or
both, has been satisfied.
"Excluded Foreign Subsidiaries": any Foreign Subsidiary the pledge of
all of whose Capital Stock as Collateral would, in the good faith judgment of
the Borrower, result in adverse tax consequences to the Borrower.
"FCC" means the Federal Communications Commission of the United States
of America.
"Foreign Subsidiary": any Subsidiary of the Borrower that is not a
Domestic Subsidiary.
"GAAP": generally accepted accounting principles in the United States
of America as in effect from time to time set forth in the opinions and
pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and the statements and pronouncements of the
Financial Accounting Standards Board and the rules and regulations of the
Securities and Exchange Commission, or in such other statements by such other
entity as may be in general use by significant segments of the accounting
profession, which are applicable to the circumstances of the Borrower as of the
date of determination, except that for purposes of Section 6.1, GAAP shall be
determined on the basis of such principles in effect on the date hereof and
consistent with those used in the preparation of the audited financial
statements of the Borrower in respect of the fiscal year ended December 31,
1995, delivered pursuant to
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Section 3.1(b). In the event that any "Accounting Change" (as defined below)
shall occur and such change results in a change in the method of calculation of
financial covenants, standards or terms in this Agreement, then the Borrower
and the Lender agree to enter into negotiations in order to amend such
provisions of this Agreement so as to equitably reflect such Accounting Changes
with the desired result that the criteria for evaluating the Borrower's
financial condition shall be the same after such Accounting Changes as if such
Accounting Changes had not been made. Until such time as such an amendment
shall have been executed and delivered by the Borrower and the Lender, all
financial covenants, standards and terms in this Agreement shall continue to be
calculated or construed as if such Accounting Changes had not occurred.
"Accounting Changes" refers to changes in accounting principles required by the
promulgation of any rule, regulation, pronouncement or opinion by the Financial
Accounting Standards Board of the American Institute of Certified Public
Accountants or, if applicable, the Securities and Exchange Commission (or
successors thereto or agencies with similar functions).
"Governmental Authority": any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guarantee and Collateral Agreement": the Guarantee and Collateral
Agreement to be executed and delivered by the Borrower and each Guarantor,
substantially in the form of Exhibit A, as the same may be amended,
supplemented or otherwise modified from time to time.
"Guarantee Obligation": as to any Person (the "guaranteeing person"),
any obligation of (a) the guaranteeing person or (b) another Person (including,
without limitation, any bank under any letter of credit) to induce the creation
of which the guaranteeing person has issued a reimbursement, counterindemnity
or similar obligation, in either case guaranteeing or in effect guaranteeing
any Indebtedness, leases, dividends or other obligations (the "primary
obligations") of any other third Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation, any obligation
of the guaranteeing person, whether or not contingent, (i) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or payment of
any such primary obligation or (2) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (iii) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation or (iv) otherwise to assure or hold harmless the owner of
any such primary obligation against loss in respect thereof; provided, however,
that the term Guarantee Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business. The
amount of any Guarantee Obligation of any guaranteeing person shall be deemed
to be the lower of (a) an amount equal to the stated or determinable amount of
the primary obligation in respect of which such Guarantee Obligation is made
and (b) the maximum amount for which such guaranteeing person may be liable
pursuant to the terms of the instrument embodying such Guarantee Obligation,
unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such guaranteeing person's
maximum reasonably anticipated liability in respect thereof as determined by
the Borrower in good faith.
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<PAGE> 9
"Guarantors": the collective reference to Cyclone Communications
Corporation, a Delaware corporation, Cyclone Radio LLC, a Delaware limited
liability company, and Paul W.Robinson, Jr., in his individual capacity, Lana
A. Robinson, in her individual capacity, and each Subsidiary Guarantor.
"Incur": as defined in Section 6.1.
"Indebtedness": of any Person at any date, without duplication, (a)
all indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than
current trade payables incurred in the ordinary course of such Person's
business), (c) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in the event of default
are limited to repossession or sale of such property), (e) all Capital Lease
Obligations of such Person, (f) all obligations of such Person, contingent or
otherwise, as an account party under acceptance, letter of credit or similar
facilities, (g) all obligations of such Person, contingent or otherwise, to
purchase, redeem, retire or otherwise acquire for value any Capital Stock of
such Person, (h) all Guarantee Obligations of such Person in respect of
obligations of the kind referred to in clauses (a) through (g) above and (i)
all obligations of the kind referred to in clauses (a) through (h) above
secured by (or for which the holder of such obligation has an existing right,
contingent or otherwise, to be secured by) any Lien on property (including,
without limitation, accounts and contract rights) owned by such Person, whether
or not such Person has assumed or become liable for the payment of such
obligation.
"Insolvency": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Interest Payment Date": means (i) the first day of each calendar
month to occur while the Loan is outstanding and (ii) the Maturity Date.
"Lien": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement and any
capital lease having substantially the same economic effect as any of the
foregoing).
"Loan": means the loan made by the Lender pursuant to Section 2.1 of
this Agreement.
"Loan Documents": this Agreement, the Security Documents and the
Note.
"Loan Parties": the Borrower and each Guarantor which is a party to a
Loan Document.
"Material Adverse Effect": a material adverse effect on (a) the
business, assets, property, condition (financial or otherwise) or prospects of
the Borrower and its Subsidiaries taken as a
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<PAGE> 10
whole or (b) the validity or enforceability of this Agreement or any of the
other Loan Documents or the rights or remedies of the Lender hereunder or
thereunder.
"Material Environmental Amount": an amount payable by the Borrower
and/or its Subsidiaries in excess of $50,000 for remedial costs, compliance
costs, compensatory damages, punitive damages, fines, penalties or any
combination thereof.
"Materials of Environmental Concern": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as
such in or under any Environmental Law, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.
"Maturity Date" means the earliest to occur of (i) the Stated Maturity
Date, (ii) the closing of the acquisition of the Stations pursuant to the Asset
Purchase Agreement, and (iii) the 75th day following the termination of the
Asset Purchase Agreement.
"Mortgaged Properties": the real properties listed on Schedule 1.1A,
as to which the Lender shall be granted a Lien pursuant to the Mortgages.
"Mortgages": each of the mortgages and deeds of trust made by any
Loan Party in favor of, or for the benefit of the Lender, substantially in the
form of Exhibit D (with such changes thereto as shall be advisable under the
law of the jurisdiction in which such mortgage or deed of trust is to be
recorded), as the same may be amended, supplemented or otherwise modified from
time to time.
"Multiemployer Plan": a Plan which is a multiemployer plan as defined
in Section 4001(a)(3) of ERISA.
"Non-Excluded Taxes": as defined in Section 2.10(a).
"Note": means any promissory note of the Borrower evidencing the
Loan.
"Obligations": the unpaid principal of and interest on (including,
without limitation, interest accruing after the maturity of the Loan and
interest accruing after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) the Loan and all other obligations and
liabilities of the Borrower to the Lender, whether direct or indirect, absolute
or contingent, due or to become due, or now existing or hereafter incurred,
which may arise under, out of, or in connection with, this Agreement, any other
Loan Document, or any other document made, delivered or given in connection
herewith or therewith, whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses (including, without limitation,
all fees, charges and disbursements of counsel to the Lender that are required
to be paid by the Borrower pursuant hereto) or otherwise.
"Participant": as defined in Section 9.6(b).
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"PBGC": the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA (or any successor).
"Person": an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of whatever
nature.
"Plan": at a particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly Controlled
Entity is (or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5) of
ERISA.
"Pro Forma Balance Sheet": as defined in Section 3.1(a).
"Properties": as defined in Section 3.17.
"Property": any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible,
including, without limitation, Capital Stock.
"Regulation U": Regulation U of the Board as in effect from time to
time.
"Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section
4241 of ERISA.
"Reportable Event": any of the events set forth in Section 4043(b) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsection .13, .14, .16, .18, .19 or .20 of PBGC Reg. Section
2615.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person
or any of its property is subject.
"Responsible Officer": the chief executive officer, president or
chief financial officer of the general partner of the Borrower, but in any
event, with respect to financial matters, the chief financial officer of the
Borrower.
"Security Documents": the collective reference to the Guarantee and
Collateral Agreement, the Mortgages and all other security documents hereafter
delivered to the Lender granting a Lien on any Property of any Person to secure
the obligations and liabilities of any Loan Party under any Loan Document.
"Single Employer Plan": any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.
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<PAGE> 12
"Solvent": when used with respect to any Person, means that, as of
any date of determination, (a) the amount of the "present fair saleable value"
of the assets of such Person will, as of such date, exceed the amount of all
"liabilities of such Person, contingent or otherwise", as of such date, as such
quoted terms are determined in accordance with applicable federal and state
laws governing determinations of the insolvency of debtors, (b) the present
fair saleable value of the assets of such Person will, as of such date, be
greater than the amount that will be required to pay the liability of such
Person on its debts as such debts become absolute and matured, (c) such Person
will not have, as of such date, an unreasonably small amount of capital with
which to conduct its business, and (d) such Person will be able to pay its
debts as they mature. For purposes of this definition, (i) "debt" means
liability on a "claim", and (ii) "claim" means any (x) right to payment,
whether or not such a right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured or unsecured or (y) right to an equitable remedy for breach of
performance if such breach gives rise to a right to payment, whether or not
such right to an equitable remedy is reduced to judgment, fixed, contingent,
matured or unmatured, disputed, undisputed, secured or unsecured.
"Stated Maturity Date" means, initially, October 31, 1997, and
thereafter as extended pursuant to Section 2.6.
"Station Licenses" has the meaning defined in Section 3.22 of this
Agreement.
"Stations" means, collectively, radio station WNOK-FM, radio station
WOIC-AM, both serving the Columbia, South Carolina market and radio station
WMFX-FM serving the St. Andrews, South Carolina market.
"Subsidiary": as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
such corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified,
all references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall
refer to a Subsidiary or Subsidiaries of the Borrower.
"Subsidiary Guarantor": each Subsidiary of the Borrower other than
any Excluded Foreign Subsidiary.
"Transferee": as defined in Section 9.6(g).
"U.S. Taxes": as defined in Section 9.6(d).
"Wholly Owned Subsidiary": as to any Person, any other Person all of
the Capital Stock of which (other than directors' qualifying shares required by
law) is owned by such Person directly and/or through other Wholly Owned
Subsidiaries.
"Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor that is
a Wholly Owned Subsidiary of the Borrower.
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1.2. Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined
in this Agreement shall have the defined meanings when used in the
other Loan Documents or any certificate or other document made or
delivered pursuant hereto or thereto.
(b) As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or
thereto, accounting terms relating to the Borrower and its
Subsidiaries not defined in Section 1.1 and accounting terms partly
defined in Section 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP; provided that, if the
Borrower notifies the Lender that the Borrower requests an amendment
to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof
on the operation of such provision (or if the Lender notifies the
Borrower that it requests an amendment to any provision hereof for
such purpose), regardless of whether any such notice is given before
or after such change in GAAP or in the application thereof, then such
provision shall be interpreted on the basis of GAAP as in effect and
applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended
in accordance herewith.
(c) The words "hereof", "herein" and "hereunder" and words
of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement, and Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(d) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such
terms.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Commitment. Subject to the terms and conditions hereof, the
Lender agrees to make a term loan (the "Loan") to the Borrower on the Closing
Date in an amount not to exceed the amount of the Commitment.
2.2 Procedure for Borrowing. The Borrower shall give the Lender
irrevocable notice (which notice must be received by the Lender prior to 10:00
A.M., New York City time, one Business Day prior to the anticipated Closing
Date) requesting that the Lender make the Loan on the Closing Date and
specifying the amount to be borrowed. The Loan made on the Closing Date shall
bear interest as set forth in Section 2.7. The Lender shall credit the account
of the Borrower on the books of the office of the Lender with the aggregate of
the amount requested in immediately available funds.
2.3 Repayment of the Loan. The Loan shall mature in two
installments, the first such installment to be a payment of principal of the
Loan equal to the purchase price under the Asset Purchase Agreement for the
radio station WNOK-FM, together with any accrued and unpaid interest thereon,
with the second installment to consist of the remaining principal balance of
the
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<PAGE> 14
Loan, together with any accrued and unpaid interest thereon, due and payable on
the Maturity Date.
2.4 Termination of the Commitment. The Commitment shall terminate
upon the making of the Loan under Section 2.1.
2.5 Optional Prepayments. The Borrower may at any time and from time
to time prepay the Loan, in whole or in part, without premium or penalty, upon
irrevocable notice delivered to the Lender at least two Business Days prior
thereto, which notice shall specify the date and amount of prepayment. If any
such notice is given, the amount specified in such notice shall be due and
payable on the date specified therein, together with accrued interest to such
date on the amount prepaid. Amounts prepaid on the Loan may not be reborrowed.
Partial prepayments of the Loan shall be in an aggregate principal amount of
$1,000,000 or a whole multiple thereof.
2.6 Extension of Stated Maturity Date. The Stated Maturity Date may
be extended by the Borrower upon written notice to the Lender and provided that
(i) the conditions precedent under the Asset Purchase Agreement that are the
obligation of the Borrower shall have all been fulfilled, (ii) there shall not
exist any event which with the giving of notice or the passage of time, or
both, would constitute a default or an Event of Default under the Asset
Purchase Agreement or under any Loan Document, and (iii) the new requested date
shall not be more than 30 days after the date of the latest scheduled closing
date provided in the Asset Purchase Agreement.
2.7 Interest Rates and Payment Dates.
(a) Subject to Section 2.7(b), the Loan shall bear interest
in respect of the unpaid and outstanding principal amount thereof from
the date thereof until payment in full thereof at a per annum rate
equal to 30%.
(b) (i) If the Asset Purchase Agreement is terminated as a
result of a default by WNOK Acquisition, Inc. ("WNOK Acquisition") of
any of its material obligations under the Asset Purchase Agreement and
the Borrower is entitled pursuant to the terms of the Asset Purchase
Agreement to receive all of the earnest money or draw upon any deposit
letters of credit (and any deposit escrow agreement relating thereto,
if any) relating to the Asset Purchase Agreement, and to the extent
that the Obligations are paid or repaid on or before the Maturity
Date, then the rate of interest described in Section 2.7(a) shall
automatically adjust retroactively to the Discount Rate for the period
beginning on the date the Loan was made and ending on the Maturity
Date;
(ii)If the Asset Purchase Agreement is terminated by WNOK
Acquisition and the Borrower, pursuant to the terms of such
agreements, is entitled to receive all earnest money or deposit
letters of credit (and any deposit escrow agreement relating thereto,
if any), and to the extent that the Obligations are paid on or before
the Maturity Date, then the rate of interest described in Section
2.7(a) shall automatically adjust retroactively to the Discount Rate
for the period beginning on the date the Loan was made and ending on
the Maturity Date;
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(iii)If the Asset Purchase Agreement is terminated as a
result of a default by the Borrower and WNOK Acquisition has fully
performed its obligations thereunder to the date thereof, then no
adjustment shall be made and interest shall be payable as provided in
Section 2.7 (a);
(iv) If the Asset Purchase Agreement is terminated by WNOK
Acquisition due to an unsatisfied condition precedent contained
therein relating to any matter that is beyond the control of the
Borrower, then so long as the Borrower has, in good faith, diligently
pursued all commercially reasonable efforts to fulfill all of its
obligations under the Asset Purchase Agreement, and to the extent that
the Obligations are paid on or before the Maturity Date, then the rate
of interest described in Section 2.7(a) shall automatically adjust
retroactively to the Discount Rate for the period beginning on the
date the Loan was made and ending on the Maturity Date;
(v) If the Asset Purchase Agreement is terminated by the
Borrower due to an unsatisfied condition precedent contained therein
relating to any matter that is beyond the control of WNOK Acquisition,
so long as the Borrower has, in good faith, diligently pursued all
commercially reasonable efforts to fulfill all of its obligations
under the Asset Purchase Agreement, and to the extent that the
Obligations are paid on or before the Maturity Date, then the rate of
interest described in Section 2.7 (a) shall automatically adjust
retroactively to the Discount Rate for the period beginning on the
date the Loan was made and ending on the Maturity Date.
(c) In computing interest on the Loan, the date of funding
of the Loan shall be included and the date of payment shall be
excluded so long as such payment is received at or before 12:00 p.m.
(New York time) on the date when due. Subject to Section 2.7(f),
interest on the outstanding principal amount of the Loan shall be
payable each Interest Payment Date, provided that interest accruing
pursuant to Section 2.7(e) shall be payable from time to time on
demand.
(d) Subject to Section 2.7(f), interest paid on the Loan on
any Interest Payment Date other than the Maturity Date shall be paid
as if calculated at the Discount Rate for the applicable time period,
without regard to any permitted adjustments to the interest rate as
set forth in this Section 2.7; provided, however, that if it is
determined that the Discount Rate does not apply and the interest rate
is not thereafter subject to adjustment, then it shall be deemed that
the amount of interest in excess of what was actually paid shall be
added to the then outstanding principal amount of the Loan and such
amount shall be paid at the Maturity Date.
(e) (i) If all or a portion of the principal amount of the
Loan shall not be paid when due (whether at the stated maturity, by
acceleration or otherwise), all outstanding portions of the Loan
(whether or not overdue) shall bear interest at a rate per annum which
is equal to the rate set forth in Section 2.7(a) and (ii) if all or a
portion of any interest payable on the Loan or any commitment fee or
other amount payable hereunder shall not be paid when due (whether at
on an Interest Payment Date, by acceleration or otherwise), such
overdue amount shall bear interest at a rate per annum equal to the
rate set forth in Section 2.7(a), in each case, with respect to
clauses (i) and (ii) above, from the date of such non-payment until
such amount is paid in full (as well after as before
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<PAGE> 16
judgment). Any amounts subject to the provisions of this Section
2.7(e) shall not have the benefit of any of the retroactive
adjustments otherwise provided for in this Section 2.7 even though any
such amounts may have otherwise been subject to such retroactive
adjustments.
(f) An amount equal to $300,000 of the interest to first
accrue on the Loan shall be added to the then outstanding principal
balance of the Loan as such interest accrues and would be payable and
shall bear interest at the rate set forth in Section 2.7(a) subject to
such adjustment as permitted by other provisions of this Section 2.7
and shall be paid on the Maturity Date. While interest on the Loan in
such an amount is accruing, interest payments on the Loan shall be
deferred until the first Interest Payment Date immediately following
the date on which the first such $300,000 in interest accrues.
2.8 Computation of Interest and Fees. Interest, fees and commissions
payable pursuant hereto shall be calculated on the basis of a 360-day year for
the actual days elapsed.
2.9 Requirements of Law.
(a) If the adoption of or any change in any Requirement of
Law or in the interpretation or application thereof or compliance by
the Lender with any request or directive (whether or not having the
force of law) from any Governmental Authority made subsequent to the
date hereof:
(i) shall subject the Lender to any tax of any kind
whatsoever with respect to this Agreement, or change the
basis of taxation of payments to the Lender in respect
thereof (except for Non-Excluded Taxes covered by Section
2.19 and changes in the rate of tax on the overall net
income of the Lender); or
(ii) shall impose on the Lender any other condition;
and the result of any of the foregoing is to increase the cost to the
Lender, by an amount which the Lender deems to be material, or to
reduce any amount receivable hereunder in respect thereof, then, in
any such case, the Borrower shall promptly pay the Lender, upon its
demand, any additional amounts necessary to compensate the Lender for
such increased cost or reduced amount receivable. If the Lender
becomes entitled to claim any additional amounts pursuant to this
Section 2.9, it shall promptly notify the Borrower of the event by
reason of which it has become so entitled.
(b) A certificate as to any additional amounts payable
pursuant to this Section 2.9 submitted by the Lender to the Borrower
shall be conclusive in the absence of manifest error. The obligations
of the Borrower pursuant to this Section 2.9 shall survive the
termination of this Agreement and the payment of the Loan and all
other amounts payable hereunder.
2.10 Taxes. All payments made by the Borrower under this Agreement
shall be made free and clear of, and without deduction or withholding for or on
account of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any
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<PAGE> 17
Governmental Authority, excluding net income taxes and franchise taxes (imposed
in lieu of net income taxes) imposed on the Lender as a result of a present or
former connection between the Lender and the jurisdiction of the Governmental
Authority imposing such tax or any political subdivision or taxing authority
thereof or therein (other than any such connection arising solely from the
Lender having executed, delivered or performed its obligations or received a
payment under, or enforced, this Agreement or any other Loan Document). If any
such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("Non-Excluded Taxes") are required to be withheld from any
amounts payable to the Lender hereunder, the amounts so payable to the Lender
shall be increased to the extent necessary to yield to the Lender (after
payment of all Non-Excluded Taxes) interest or any such other amounts payable
hereunder at the rates or in the amounts specified in this Agreement. Whenever
any Non-Excluded Taxes are payable by the Borrower, as promptly as possible
thereafter the Borrower shall send to the Lender for its own account, a
certified copy of an original official receipt received by the Borrower showing
payment thereof. If the Borrower fails to pay any Non-Excluded Taxes when due
to the appropriate taxing authority or fails to remit to the Lender the
required receipts or other required documentary evidence, the Borrower shall
indemnify the Lender for any incremental taxes, interest or penalties that may
become payable by the Lender as a result of any such failure. The agreements
in this Section 2.10 shall survive the termination of this Agreement and the
payment of the Loans and all other amounts payable hereunder.
2.11 Indemnity. The Borrower agrees to indemnify the Lender and to
hold the Lender harmless from any loss or expense which the Lender may sustain
or incur as a consequence of default by the Borrower in making any prepayment
after the Borrower has given a notice thereof in accordance with the provisions
of this Agreement. A certificate as to any amounts payable pursuant to this
Section 2.11 submitted to the Borrower by the Lender shall be conclusive in the
absence of manifest error. This covenant shall survive the termination of this
Agreement and the payment of the Loan and all other amounts payable hereunder.
2.12 Interest Accrual for Income Tax Purposes. For federal income
tax purposes only, the accrual of interest shall be taken into account by the
Borrower and the Lender in accordance with section 1.1275-4(b) of the Treasury
regulations. The Borrower and the Lender agree that (i) the "comparable yield"
for the Loan (within the meaning of section 1.1275-4(b)(4)(i) of the Treasury
regulations) shall equal the Discount Rate, and (ii) the "projected payment
schedule" for the Loan (within the meaning of section 1.1275-4(b)(4)(ii) of the
Treasury regulations) shall include a projected payment from the Borrower to
the Lender on each Interest Payment Date during the term of the Loan in an
amount that is equal to the amount of interest that would accrue on the Loan on
each such Interest Payment Date at the Discount Rate. The provisions of this
Section 2.12 are not intended to, and do not, modify any other provision of
this Agreement or the other Loan Documents.
2.13 Loan Amount Reduction. If the Asset Purchase Agreement is
terminated as a result of a default by WNOK Acquisition of any of its material
obligations under the Asset Purchase Agreement and the Borrower is entitled
pursuant to the terms of the Asset Purchase Agreement to receive all of the
earnest money or draw upon any deposit letters of credit (and any deposit
escrow agreement relating thereto, if any) relating to the Asset Purchase
Agreement then the Lender shall reduce the outstanding principal amount of the
Loan by an amount equal to $425,000 and the Borrower shall no further
obligation to repay such $425,000.
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SECTION 3. REPRESENTATIONS AND WARRANTIES
To induce the Lender to enter into this Agreement and to make the
Loans and issue or participate in the Letters of Credit, the Borrower hereby
represents and warrants to the Lender that:
3.1 Financial Condition.
(a) The unaudited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at December 31, 1996
(including the notes thereto) (the "Pro Forma Balance Sheet"), has
heretofore been furnished to the Lender, has been prepared based on
the best information available to the Borrower as of the date of
delivery thereof, and presents fairly on a the consolidated financial
position of Borrower and its consolidated Subsidiaries as at December
31, 1996, and the consolidated results of its operations and its
consolidated cash flows for such fiscal year then ended
(b) The audited consolidated balance sheets of the Borrower
and its consolidated Subsidiaries as at December 31, 1994, and
December 31, 1995, and the related consolidated statements of income
and of cash flows for the fiscal years ended on such dates, reported
on by and accompanied by an unqualified report from BDO Seidman,
L.L.P., independent public accountants, present fairly the
consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of its
operations and its consolidated cash flows for the respective fiscal
years then ended.
3.2 No Change. Since December 31, 1996 there has been no development
or event which has had or could reasonably be expected to have a Material
Adverse Effect.
3.3 Corporate Existence; Compliance with Law. The Borrower (a) is
duly formed, validly existing and in good standing under the laws of the
jurisdiction of its formation, (b) has the partnership power and authority, and
legal right, to own and operate its property, to lease the property it operates
as lessee and to conduct the business in which it is currently engaged, (c) is
duly qualified as a foreign limited partnership and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of property
or the conduct of its business requires such qualification, and (d) is in
compliance with all Requirements of Law except to the extent that the failure
to comply therewith could not, in the aggregate, reasonably be expected to have
a Material Adverse Effect, and each of its Subsidiaries (w) is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (x) has the corporate power and authority, and the legal right,
to own and operate its property, to lease the property it operates as lessee
and to conduct the business in which it is currently engaged, (y) is duly
qualified as a foreign corporation and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property or the conduct
of its business requires such qualification and (z) is in compliance with all
Requirements of Law except to the extent that the failure to comply therewith
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.
3.4 Corporate Power; Authorization; Enforceable Obligations. Each
Loan Party has the corporate or partnership power and authority, and the legal
right, to make, deliver and perform
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the Loan Documents to which it is a party and, in the case of the Borrower, to
borrow hereunder. Each Loan Party has taken all necessary corporate or
partnership action to authorize the execution, delivery and performance of the
Loan Documents to which it is a party and, in the case of the Borrower, to
authorize the borrowings on the terms and conditions of this Agreement. No
consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required in
connection with the borrowings hereunder or with the execution, delivery,
performance, validity or enforceability of this Agreement or any of the Loan
Documents, except (i) consents, authorizations, filings and notices described
in Schedule 3.4, which consents, authorizations, filings and notices have been
obtained or made and are in full force and effect, (ii) the filings referred to
in Section 3.19(b) and (iii) the consents of the FCC to the transfers of
control of the Station Licenses described in Section 9.16. Each Loan Document
has been duly executed and delivered on behalf of each Loan Party which is a
party thereto. This Agreement constitutes, and each other Loan Document upon
execution will constitute, a legal, valid and binding obligation of each Loan
Party which is a party thereto, enforceable against each such Loan Party in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law).
3.5 No Legal Bar. The execution, delivery and performance of this
Agreement and the other Loan Documents, the borrowings hereunder and the use of
the proceeds thereof will not violate any Requirement of Law or any Contractual
Obligation of the Borrower or any of its Subsidiaries and will not result in,
or require, the creation or imposition of any Lien on any of their respective
properties or revenues pursuant to any Requirement of Law or any such
Contractual Obligation (other than the Liens created by the Security
Documents). No Requirement of Law or Contractual Obligation applicable to the
Borrower or any of its Subsidiaries could reasonably be expected to have a
Material Adverse Effect.
3.6 No Material Litigation. Except as set forth on Schedule 3.6
attached hereto, no litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of the
Borrower, threatened by or against the Borrower or any of its Subsidiaries or
against any of their respective properties or revenues (a) with respect to any
of the Loan Documents or any of the transactions contemplated hereby or
thereby, or (b) which could reasonably be expected to have a Material Adverse
Effect.
3.7 No Default. Neither the Borrower nor any of its Subsidiaries is
in default under or with respect to any of its Contractual Obligations in any
respect which could reasonably be expected to have a Material Adverse Effect.
No Default or Event of Default has occurred and is continuing.
3.8 Ownership of Property; Liens. Each of the Borrower and its
Subsidiaries has title in fee simple to, or a valid leasehold interest in, all
its real property, and good title to, or a valid leasehold interest in, all its
other property, and none of such property is subject to any Lien except as
permitted by Section 6.3.
3.9 Intellectual Property. The Borrower and each of its Subsidiaries
owns, or is licensed to use, all trademarks, tradenames, copyrights,
technology, know-how and processes ("Intellectual Property") necessary for the
conduct of its business as currently conducted. No
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material claim has been asserted and is pending by any Person challenging or
questioning the use of any Intellectual Property or the validity or
effectiveness of any Intellectual Property, nor does the Borrower know of any
valid basis for any such claim. The use of Intellectual Property by the
Borrower and its Subsidiaries does not infringe on the rights of any Person in
any material respect.
3.10 Taxes. Each of the Borrower and its Subsidiaries has filed or
caused to be filed all Federal, state and other material tax returns which are
required to be filed and has paid all taxes shown to be due and payable on said
returns or on any assessments made against it or any of its property and all
other taxes, fees or other charges imposed on it or any of its property by any
Governmental Authority (other than any the amount or validity of which are
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of the Borrower or its Subsidiaries, as the case may be); no tax Lien has
been filed, and, to the knowledge of the Borrower, no claim is being asserted,
with respect to any such tax, fee or other charge.
3.11 Federal Regulations. No part of the proceeds of the Loan will
be used for "purchasing" or "carrying" any "margin stock" within the respective
meanings of each of the quoted terms under Regulation G or Regulation U of the
Board as now and from time to time hereafter in effect or for any purpose which
violates the provisions of the Regulations of the Board. If requested by the
Lender, the Borrower will furnish to the Lender a statement to the foregoing
effect in conformity with the requirements of FR Form G-3 or FR Form U-1
referred to in said Regulation G or Regulation U, as the case may be.
3.12 Labor Matters. There are no strikes or other labor disputes
against the Borrower or any of its Subsidiaries pending or, to the knowledge of
the Borrower, threatened that (individually or in the aggregate) could
reasonably be expected to have a Material Adverse Effect. Hours worked by and
payment made to employees of the Borrower and its Subsidiaries have not been in
violation of the Fair Labor Standards Act or any other applicable Requirement
of Law dealing with such matters that (individually or in the aggregate) could
reasonably be expected to have a Material Adverse Effect. All payments due
from the Borrower or any of its Subsidiaries on account of employee health and
welfare insurance that (individually or in the aggregate) could reasonably be
expected to have a Material Adverse Effect if not paid have been paid or
accrued as a liability on the books of the Borrower or the relevant Subsidiary.
3.13 ERISA. Neither a Reportable Event nor an "accumulated funding
deficiency" (within the meaning of Section 412 of the Code or Section 302 of
ERISA) has occurred during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan, and each Plan
has complied in all material respects with the applicable provisions of ERISA
and the Code. No termination of a Single Employer Plan has occurred, and no
Lien in favor of the PBGC or a Plan has arisen, during such five-year period.
The present value of all accrued benefits under each Single Employer Plan
(based on those assumptions used to fund such Plans) did not, as of the last
annual valuation date prior to the date on which this representation is made or
deemed made, exceed the value of the assets of such Plan allocable to such
accrued benefits by a material amount. Neither the Borrower nor any Commonly
Controlled Entity has had a complete or partial withdrawal from any
Multiemployer Plan which has resulted or could reasonably be expected to result
in a material liability under ERISA, and neither the Borrower nor any Commonly
Controlled Entity would become subject to any material
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liability under ERISA if the Borrower or any such Commonly Controlled Entity
were to withdraw completely from all Multiemployer Plans as of the valuation
date most closely preceding the date on which this representation is made or
deemed made. No such Multiemployer Plan is in Reorganization or Insolvent.
3.14 Investment Company Act; Other Regulations. No Loan Party is an
"investment company", or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended. No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) which limits its ability to incur Indebtedness.
3.15 Subsidiaries. The Borrower has no Subsidiaries.
3.16 Use of Proceeds. The proceeds of the Loan shall be used (i) to
refinance the loan between the Borrower and Clear Channel Radio, Inc. in an
amount to include outstanding principal amount thereof together with accrued
and unpaid interest thereon as of the Closing Date (but excluding any
prepayment penalty, additional interest, and additional fees) and in any event
not to exceed $12,870,800 (ii) to provide working capital for the Borrower in
an amount not to exceed $177,200 to be used for other general lawful purposes
of the Borrower and (iii) to provide funds for a settlement payment by the
Borrower to Clear Channel Radio, Inc. in an amount not to exceed $425,000.
3.17 Environmental Matters. Except as set forth in the Environment
Reports:
(a) The facilities and properties owned, leased or operated
by the Borrower or any of its Subsidiaries (the "Properties") do not
contain, and have not previously contained, any Materials of
Environmental Concern in amounts or concentrations or under
circumstances which (i) constitute or constituted a violation of, or
(ii) could give rise to liability under, any Environmental Law, except
in either case insofar as such violation or liability, or any
aggregation thereof, could not reasonably be expected to result in the
payment of a Material Environmental Amount.
(b) The Properties and all operations at the Properties are
in material compliance, and have in the last five years been in
material compliance, with all applicable Environmental Laws, and there
is no contamination at, under or about the Properties or violation of
any Environmental Law with respect to the Properties or the business
operated by the Borrower or any of its Subsidiaries (the "Business")
which could materially interfere with the continued operation of the
Properties or materially impair the fair saleable value thereof.
Neither the Borrower nor any of its Subsidiaries has assumed any
liability of any other Person under Environmental Laws.
(c) Neither the Borrower nor any of its Subsidiaries has
received or is aware of any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with
regard to any of the Properties or the Business, nor does the Borrower
have knowledge or reason to believe that any such notice will be
received or is being threatened, except insofar as such notice or
threatened notice, or any aggregation thereof, does not involve a
matter or matters that could reasonably be expected to result in the
payment of a Material Environmental Amount.
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(d) Materials of Environmental Concern have not been
transported or disposed of from the Properties in violation of, or in
a manner or to a location which could give rise to liability under,
any Environmental Law, nor have any Materials of Environmental Concern
been generated, treated, stored or disposed of at, on or under any of
the Properties in violation of, or in a manner that could give rise to
liability under, any applicable Environmental Law, except insofar as
any such violation or liability referred to in thisparagraph, or any
aggregation thereof, could not reasonably be expected to result in the
payment of a Material Environmental Amount.
(e) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of the Borrower,
threatened, under any Environmental Law to which the Borrower or any
Subsidiary is or will be named as a party with respect to the
Properties or the Business, nor are there any consent decrees or other
decrees, consent orders, administrative orders or other orders, or
other administrative or judicial requirements outstanding under any
Environmental Law with respect to the Properties or the Business,
except insofar as such proceeding, action, decree, order or other
requirement, or any aggregation thereof, could not reasonably be
expected to result in the payment of a Material Adverse Amount.
(f) There has been no release or threat of release of
Materials of Environmental Concern at or from the Properties, or
arising from or related to the operations of, the Borrower or any
Subsidiary in connection with the Properties or otherwise in
connection with the Business, in violation of or in amounts or in a
manner that could give rise to liability under Environmental Laws,
except insofar as any such violation or liability referred to in this
paragraph, or any aggregation thereof, could not reasonably be
expected to result in the payment of a Material Environmental Amount.
3.18 Accuracy of Information, etc. No statement or information
contained in this Agreement, any other Loan Document, or any other document,
certificate or statement furnished to the Lender, by or on behalf of any Loan
Party for use in connection with the transactions contemplated by this
Agreement or the other Loan Documents, contained as of the date such statement,
information, document or certificate was so furnished, any untrue statement of
a material fact or omitted to state a material fact necessary in order to make
the statements contained herein or therein not misleading. The projections and
pro forma financial information contained in the materials referenced above are
based upon good faith estimates and assumptions believed by management of the
Borrower to be reasonable at the time made, it being recognized by the Lender
that such financial information as it relates to future events is not to be
viewed as fact and that actual results during the period or periods covered by
such financial information may differ from the projected results set forth
therein by a material amount. As of the date hereof, the representations and
warranties of the Borrower in the Asset Purchase Agreement are true and correct
in all material respects. There is no fact known to any Loan Party that could
reasonably be expected to have a Material Adverse Effect that has not been
expressly disclosed herein, in the other Loan Documents, or in any other
documents, certificates and statements furnished to the Lender for use in
connection with the transactions contemplated hereby and by the other Loan
Documents.
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3.19 Security Documents.
(a) The Guarantee and Collateral Agreement is effective to
create in favor of the Lender, a legal, valid and enforceable security
interest in the Collateral described therein and proceeds thereof. In
the case of the Pledged Stock described in the Guarantee and
Collateral Agreement, when stock certificates representing such
Pledged Stock are delivered to the Lender, and in the case of the
other Collateral described in the Guarantee and Collateral Agreement,
when financing statements in appropriate form are filed in theoffices
specified on Schedule 3.19(a), the Guarantee and Collateral Agreement
shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the Loan Parties in such Collateral
and the proceeds thereof, as security for the Obligations (as defined
in the Guarantee and Collateral Agreement), in each case prior and
superior in right to any other Person.
(b) Each of the Mortgages is effective to create in favor
of the Lender, a legal, valid and enforceable Lien on the Mortgaged
Properties described therein and proceeds thereof, and when the
Mortgages are filed in the offices specified on Schedule 3.19(b), each
such Mortgage shall constitute a fully perfected Lien on, and security
interest in, all right, title and interest of the Loan Parties in the
Mortgaged Properties and the proceeds thereof, as security for the
Obligations (as defined in the relevant Mortgage), in each case prior
and superior in right to any other Person.
3.20 Solvency. Each Loan Party is, and after giving effect to the
incurrence of all Indebtedness and obligations being incurred in connection
herewith and therewith will be and will continue to be, Solvent.
3.21 Regulation H. No Mortgage encumbers improved real property
which is located in an area that has been identified by the Secretary of
Housing and Urban Development as an area having special flood hazards and in
which flood insurance has been made available under the National Flood
Insurance Act of 1968.
3.22 Compliance with Applicable Laws; FCC Matters; Station Licenses.
(a) Except as permitted or contemplated hereby, the
businesses of the Borrower and its Subsidiaries have been conducted in
compliance with each applicable law, ordinance, regulation, judgment,
decree, injunction, rule or order of the FCC or any other Governmental
Authority binding on the Borrower or any of its Subsidiaries or their
respective properties or assets, except for such instances of
noncompliance that do not and would not reasonably be expected to have
a Material Adverse Effect. Except as set forth on Schedule 3.22 as
attached hereto, no investigation or review by any Governmental
Authority with respect to the Borrower or any of its Subsidiaries is
pending or, to the Borrower's knowledge, threatened, except for such
investigations or reviews as do not and would not reasonably be
expected to have a Material Adverse Effect. Without limiting the
generality of the foregoing, the Borrower and its Subsidiaries have
complied with the Communications Act, all rules, regulations and
written policies of the FCC thereunder, all obligations with respect
to equal opportunity under applicable law, and all rules and
regulations of the Federal Aviation Administration applicable to the
towers used by the Stations, except, in each case, where the failure
to so
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comply does not and would not reasonably be expected to result in a
Material Adverse Effect. In addition, the Borrower and its
Subsidiaries have duly and timely filed, or caused to be so filed,
with the FCC all material reports, statements, documents,
registrations, filings or submissions with respect to the operation of
the Stations and the ownership thereof, including, without limitation,
applications for renewal of authority required by applicable law to be
filed (except where the failure to make such filings on a timely basis
does not have or would not reasonably be expected to have a Material
Adverse Effect). All such FCC filings complied with all material
applicable laws when made and no material deficiencies have been
asserted with respect to any such filings. The material required by
47 C.F.R. Section 73.3526 to be kept in the public inspection files
of the Stations is materially complete.
(b) Schedule 3.22 attached hereto lists (i) all licenses,
permits and other authorizations, including the expiration dates
thereof, issued to the Borrower or any of its Subsidiaries by the FCC
relating to the Stations and held by them as of the date of this
Agreement and (ii) all licenses, permits or authorizations issued to
the Borrower or any of its Subsidiaries by any other Governmental
Authority which are material to the operations of the Stations and
held by it as of the date of this Agreement, the loss of which have or
would reasonably be expected to have a Material Adverse Effect. Such
licenses, permits and authorizations, and all pending applications for
modification, extension or renewal thereof or for new licenses,
permits, permissions or authorizations, are collectively referred to
herein as the "Station Licenses". The Stations have been operated in
all material respects in accordance with the terms of the Station
Licenses held by the Borrower or its Subsidiaries. There are no
material proceedings pending or, to the Borrower's knowledge,
threatened with respect to the Borrower's or any of its Subsidiaries'
ownership or operation of the Stations which reasonably may be
expected to result in the revocation, material adverse modification,
non-renewal or suspension of any of the Station Licenses, the issuance
against the Borrower or any of its Subsidiaries of any cease and
desist order, or the imposition of any administrative actions by the
FCC or any other Governmental Authority with respect to the Station
Licenses, or which reasonably may be expected to adversely affect the
Stations' ability to operate as currently operated. Except as set
forth on Schedule 3.22 attached hereto, to the Borrower's knowledge,
no other broadcast station or radio communications facility is causing
interference to the Stations' transmissions beyond that which is
allowed by FCC rules and regulations. The Borrower has no reason to
believe that the FCC will not renew the Station Licenses issued by the
FCC in the ordinary course of business.
SECTION 4. CONDITIONS PRECEDENT
4.1 Conditions to the Extension of Credit. The agreement of the
Lender to make the extension of credit requested to be made by it is subject to
the satisfaction, prior to or concurrently with the making of such extension of
credit on the Closing Date, of the following conditions precedent, provided
that the Lender may waive any of the following conditions precedent as it may
determine in its sole discretion:
(a) Loan Documents. The Lender shall have received (i)
this Agreement, executed and delivered by a duly authorized officer of
the Borrower, (ii) the Guarantee and Collateral Agreement, executed
and delivered by a duly authorized officer of the
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Borrower and each Guarantor, (iii) each of the Mortgages, executed and
delivered by a duly authorized officer of each party thereto, and (iv)
the Note conforming to the requirements hereof and executed and
delivered by a duly authorized officer of the Borrower.
(b) Approvals. All governmental and third party approvals
(including, subject to Section 5.10, landlords' consents) necessary in
connection with this Agreement, the continuing operations of the
Borrower and its Subsidiaries and the transactions contemplated hereby
shall have been obtained and be in full force and effect, and all
applicable waiting periods shall have expired without any action being
taken or threatened by any competent authority which would restrain,
prevent or otherwise impose adverse conditions on the financing
contemplated hereby.
(c) Asset Purchase Agreement. The Lender shall have
received the Asset Purchase Agreement, executed and delivered by an
authorized officer of each party thereto.
(d) Certificates of Partnership and Incorporation. Copies
of the Certificate of Limited Partnership of the Borrower and
appropriate corporate document for each of its Subsidiaries and the
other Loan Parties, together with all amendments thereto, certified by
the appropriate governmental officer in its jurisdiction of
organization or formation and copies of the Agreement of Limited
Partnership of the Borrower, together with all amendments thereto,
certified by a Responsible Officer as being in full force and effect.
(e) Good Standing Certificates. Certificates of good
standing for each of the Borrower, its Subsidiaries, its general
partner, and its limited partner certified by the appropriate
governmental officer in its respective jurisdiction of formation or
organization.
(f) Existing Indebtedness; Release of Liens. All existing
Indebtedness for borrowed money of the Borrower and its Subsidiaries
shall have been repaid (or shall be repaid promptly from the proceeds
of the Loan) and all terminations and releases of Liens securing such
Indebtedness shall have been executed and delivered to the Lender
together with a written release by the lender thereof of all claims
and causes of action against the Borrower or any of its property.
(g) Lien Searches. The Lender shall have received the
results of a recent lien search in each of the jurisdictions where
assets of the Loan Parties are located, and such search shall reveal
no liens on any of the assets of the Borrower or its Subsidiaries
except for liens permitted by Section 6.2.
(h) Environmental Audit. The Lender shall have received an
environmental audit with respect to the real properties of the
Borrower and its Subsidiaries specified by the Lender.
(i) Closing Certificate. The Lender shall have received, a
certificate of each Loan Party, dated the Closing Date, substantially
in the form of Exhibit C, with appropriate insertions and attachments.
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(j) Legal Opinions. The Lender shall have received the
following executed legal opinions:
(i) the legal opinion of Hale and Dorr LLP, counsel to
the Borrower and its Subsidiaries, substantially in the form
of Exhibit E; and
(ii) the legal opinion of local counsel in South Carolina
and of such other special and local counsel as may be
required by the Lender.
Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Lender may
reasonably require.
(k) Pledged Stock; Stock Powers. The Lender shall have
received the certificates representing the shares of Capital Stock
pledged pursuant to the Guarantee and Collateral Agreement, together
with an undated stock power for each such certificate executed in
blank by a duly authorized officer of the pledgor thereof.
(l) Filings, Registrations and Recordings. Each document
(including, without limitation, any Uniform Commercial Code financing
statement) required by the Security Documents or under law or
reasonably requested by the Lender to be filed, registered or recorded
in order to create in favor of the Lender, a perfected Lien on the
Collateral described therein, prior and superior in right to any other
Person (other than with respect to Liens expressly permitted by
Section 6.2), shall be in proper form for filing, registration or
recordation.
(m) Mortgages, etc.
(i) The Lender shall have received a Mortgage with
respect to each Mortgaged Property, executed and delivered
by a duly authorized officer of each party thereto.
(ii) If requested by the Lender, the Lender shall have
received, and the title insurance company issuing the policy
referred to in Section 5.1(m)(iii) (the "Title Insurance
Company") shall have received, maps or plats of an as-built
survey of the sites of the Mortgaged Properties certified to
the Lender and the Title Insurance Company in a manner
satisfactory to them, dated a date satisfactory to the
Lender and the Title Insurance Company by an independent
professional licensed land surveyor satisfactory to the
Lender and the Title Insurance Company, which maps or plats
and the surveys on which they are based shall be made in
accordance with the Minimum Standard Detail Requirements for
Land Title Surveys jointly established and adopted by the
American Land Title Association and the American Congress on
Surveying and Mapping in 1992, and, without limiting the
generality of the foregoing, there shall be surveyed and
shown on such maps, plats or surveys the following: (A) the
locations on such sites of all the buildings, structures and
other improvements and the established building setback
lines; (B) the lines of streets abutting the sites and width
thereof; (C) all access and other easements appurtenant to
the sites; (D) all roadways, paths, driveways, easements,
encroachments and overhanging projections and
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similar encumbrances affecting the site, whether recorded,
apparent from a physical inspection of the sites or
otherwise known to the surveyor; (E) any encroachments on
any adjoining property by the building structures and
improvements on the sites; (F) if the site is described as
being on a filed map, a legend relating the survey to said
map; and (G) the flood zone designations, if any, in which
the Mortgaged Properties are located.
(iii) The Lender shall have received in respect of
each Mortgaged Property a mortgagee's title insurance policy
(or policies) or marked up unconditional binder for such
insurance. Each such policy shall (A) be in an amount
satisfactory to the Lender; (B) be issued at ordinary rates;
(C) insure that the Mortgage insured thereby creates a valid
first Lien on such Mortgaged Property free and clear of all
defects and encumbrances, except as disclosed therein; (D)
name the Lender as the insured thereunder; (E) be in the
form of ALTA Loan Policy - 1970 (Amended 10/17/70 and
10/17/84) (or equivalent policies); (F) contain such
endorsements and affirmative coverage as the Lender may
reasonably request and (G) be issued by title companies
satisfactory to the Lender (including any such title
companies acting as co-insurers or reinsurers, at the option
of the Lender). The Lender shall have received evidence
satisfactory to it that all premiums in respect of each such
policy, all charges for mortgage recording tax, and all
related expenses, if any, have been paid.
(iv) If requested by the Lender, the Lender shall have
received (A) a policy of flood insurance which (1) covers
any parcel of improved real property which is encumbered by
any Mortgage (2) is written in an amount not less than the
outstanding principal amount of the indebtedness secured by
such Mortgage which is reasonably allocable to such real
property or the maximum limit of coverage made available
with respect to the particular type of property under the
National Flood Insurance Act of 1968, whichever is less, and
(3) has a term ending not later than the maturity of the
Indebtedness secured by such Mortgage and (B) confirmation
that the Borrower has received the notice required pursuant
to Section 208.8(e)(3) of Regulation H of the Board.
(v) The Lender shall have received a copy of all
recorded documents referred to, or listed as exceptions to
title in, the title policy or policies referred to in
Section 5.1(m)(iii) and a copy of all other material
documents affecting the Mortgaged Properties.
(n) Insurance. The Lender shall have received insurance
certificates satisfying the requirements of Section 5.3 of the
Guarantee and Collateral Agreement.
(o) Representations and Warranties. Each of the
representations and warranties made by any Loan Party in or pursuant
to the Loan Documents shall be true and correct in all material
respects on and as of such date as if made on and as of such date.
(p) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the
extensions of credit requested to be made on such date.
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(q) Documentation. The Lender shall have received such
other documents as the Lender may reasonably request, all in form and
substance reasonably satisfactory to the Lender.
SECTION 5. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the Loan or other amount
is owing to the Lender hereunder, the Borrower shall and shall cause each of
its Subsidiaries to:
5.1 Financial Statements. Furnish to the Lender:
(a) as soon as available, but in any event within 90 days
after the end of each fiscal year of the Borrower, a copy of the
audited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such year and the related
audited consolidated statements of income and of cash flows for such
year, setting forth in each case in comparative form the figures for
the previous year, reported on without a "going concern" or like
qualification or exception, or qualification arising out of the scope
of the audit, by BDO Seidman, L.L.P. or other independent certified
public accountants of nationally recognized standing;
(b) as soon as available, but in any event not later than
30 days after the end of each of the first three quarterly periods of
each fiscal year of the Borrower, the unaudited consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at the end
of such quarter and the related unaudited consolidated statements of
income and of cash flows for such quarter and the portion of the
fiscal year through the end of such quarter, setting forth in each
case in comparative form the figures for the previous year, certified
by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments); and
(c) as soon as available, but in any event not later than
20 days after the end of each month occurring during each fiscal year
of the Borrower (other than the third, sixth, ninth and twelfth such
month), the unaudited consolidated balance sheets of the Borrower and
its Subsidiaries as at the end of such month and the related unaudited
consolidated statements of income and of cash flows for such month and
the portion of the fiscal year through the end of such month, setting
forth in each case in comparative form the figures for the previous
year, certified by a Responsible Officer as being fairly stated in all
material respects (subject to normal year-end audit adjustments);
all such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).
5.2 Certificates; Other Information. Furnish to the Lender:
(a) concurrently with the delivery of the financial
statements referred to in Section 5.1(a), a certificate of the
independent certified public accountants reporting on such financial
statements stating that in making the examination necessary therefor
no
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knowledge was obtained of any Default or Event of Default, except as
specified in such certificate;
(b) concurrently with the delivery of any financial
statements pursuant to Section 5.1, (i) a certificate of a Responsible
Officer stating that, to the best of each such Responsible Officer's
knowledge, each Loan Party during such period has observed or
performed all of its covenants and other agreements, and satisfied
every condition, contained in this Agreement and the other Loan
Documents to which it is a party to be observed, performed or
satisfied by it, and that such Responsible Officer has obtained
noknowledge of any Default or Event of Default except as specified in
such certificate and (ii) in the case of quarterly or annual financial
statements, a Compliance Certificate containing all information
necessary for determining compliance by the Borrower and its
Subsidiaries with the provisions of this Agreement referred to therein
as of the last day of the fiscal quarter or fiscal year of the
Borrower, as the case may be;
(c) within 45 days after the end of each fiscal quarter of
the Borrower, a narrative discussion and analysis of the financial
condition and results of operations of the Borrower and its
Subsidiaries for such fiscal quarter and for the period from the
beginning of the then current fiscal year to the end of such fiscal
quarter, covering such periods and to the comparable periods of the
previous year;
(d) promptly, such additional financial and other
information as the Lender may from time to time reasonably request.
5.3 Payment of Obligations. Pay, discharge or otherwise satisfy at
or before maturity or before they become delinquent, as the case may be, all
its material obligations of whatever nature, except where the amount or
validity thereof is currently being contested in good faith by appropriate
proceedings and reserves in conformity with GAAP with respect thereto have been
provided on the books of the Borrower or its Subsidiaries, as the case may be.
5.4 Conduct of Business and Maintenance of Existence, etc. (a) (i)
Continue to engage in business of the same general type as now conducted by it,
(ii) preserve, renew and keep in full force and effect its corporate existence
and (iii) take all reasonable action to maintain all rights, privileges and
franchises necessary or desirable in the normal conduct of its business,
except, in each case, as otherwise permitted by Section 6.4 and except, in the
case of clause (iii) above, to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect; and (b) comply with
all Contractual Obligations and Requirements of Law except to the extent that
failure to comply therewith could not, in the aggregate, reasonably be expected
to have a Material Adverse Effect.
5.5 Maintenance of Property; Insurance. (a) Keep all property
useful and necessary in its business in good working order and condition,
ordinary wear and tear excepted, and in compliance with all material FCC rules
and regulations and (b) maintain with financially sound and reputable insurance
companies insurance on all its property in at least such amounts and against at
least such risks (but including in any event public liability, product
liability and business interruption) as are usually insured against in the same
general area by companies engaged in the same or a similar business.
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5.6 Inspection of Property; Books and Records; Discussions. (a)
Keep proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of
all dealings and transactions in relation to its business and activities and
(b) subject only to applicable rules and regulations of the FCC, permit
representatives of the Lender to visit and inspect any of its properties and
examine and make abstracts from any of its books and records at any reasonable
time and as often as may reasonably be desired and to discuss the business,
operations, properties and financial and other condition of the Borrower and
its Subsidiaries with officers and employees of the Borrower and its
Subsidiaries and with its independent certified public accountants.
5.7 Notices. Promptly give notice to the Lender of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any
Contractual Obligation of the Borrower or any of its Subsidiaries or
(ii) litigation, investigation or proceeding which may exist at any
time between the Borrower or any of its Subsidiaries and any
Governmental Authority and which has a reasonable likelihood of being
adversely determined, which in either case, if not cured or if
adversely determined, as the case may be, could reasonably be expected
to have a Material Adverse Effect;
(c) any litigation or proceeding affecting the Borrower or
any of its Subsidiaries in which the amount involved is $50,000 or
more and not covered by insurance or in which injunctive or similar
relief is sought;
(d) the following events, as soon as possible and in any
event within 30 days after the Borrower knows or has reason to know
thereof: (i) the occurrence of any Reportable Event with respect to
any Plan, a failure to make any required contribution to a Plan, the
creation of any Lien in favor of the PBGC or a Plan or any withdrawal
from, or the termination, Reorganization or Insolvency of, any
Multiemployer Plan or (ii) the institution of proceedings or the
taking of any other action by the PBGC or the Borrower or any Commonly
Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or Insolvency of,
any Plan; and
(e) any development or event which has had or could
reasonably be expected to have a Material Adverse Effect.
Each notice pursuant to this Section 5.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the Borrower or the relevant Subsidiary
proposes to take with respect thereto.
5.8 Environmental Laws.
(a) Comply in all material respects with, and ensure
compliance in all material respects by all tenants and subtenants, if
any, with, all applicable Environmental Laws, and obtain and comply in
all material respects with and maintain, and ensure that all tenants
and subtenants obtain and comply in all material respects with and
maintain, any
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and all licenses, approvals, notifications, registrations or permits
required by applicable Environmental Laws.
(b) Conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all material
respects with all lawful orders and directives of all Governmental
Authorities regarding Environmental Laws.
5.9 Additional Collateral, etc.
(a) With respect to any Property acquired after the Closing
Date by the Borrower or any of its Subsidiaries (other than any
Property described in paragraph (b), (c) or (d) below) as to which the
Lender does not have a perfected Lien, promptly (i) execute and
deliver to the Lender such amendments to the Guarantee and Collateral
Agreement or such other documents as the Lender deems necessary or
advisable in order to grant to the Lender, a security interest in such
Property and (ii) take all actions necessary or advisable to grant to
the Lender a perfected first priority security interest in such
Property, including without limitation, the filing of Uniform
Commercial Code financing statements in such jurisdictions as may be
required by the Guarantee and Collateral Agreement or by law or as may
be requested by the Lender.
(b) With respect to any fee interest in any real estate
acquired after the Closing Date by the Borrower or any of its
Subsidiaries, promptly (i) execute and deliver a first priority
mortgage or deed of trust, as the case may be, in favor of the Lender
covering such real estate, in form and substance reasonably
satisfactory to the Lender, (ii) if requested by the Lender, provide
the Lender with (x) title and extended coverage insurance covering
such real estate in an amount at least equal to the purchase price of
such real estate (or such other amount as shall be reasonably
specified by the Lender) as well as a current ALTA survey thereof,
together with a surveyor's certificate and (y) any consents or
estoppels reasonably deemed necessary or advisable by the Lender in
connection with such mortgage or deed of trust, each of the foregoing
in form and substance reasonably satisfactory to the Lender and (iii)
if requested by the Lender, deliver to the Lender legal opinions
relating to the matters described above, which opinions shall be in
form and substance, and from counsel, reasonably satisfactory to the
Lender.
(c) With respect to any new Subsidiary (other than an
Excluded Foreign Subsidiary) created or acquired after the Closing
Date by the Borrower or any of its Subsidiaries, promptly (i) execute
and deliver to the Lender such amendments to the Guarantee and
Collateral Agreement as the Lender deems necessary or advisable in
order to grant to the Lender, a perfected first priority security
interest in the Capital Stock of such new Subsidiary which is owned by
the Borrower or any of its Subsidiaries, (ii) deliver to the Lender
the certificates representing such Capital Stock, together with
undated stock powers, in blank, executed and delivered by a duly
authorized officer of the Borrower or such Subsidiary, as the case may
be, (iii) cause such new Subsidiary (A) to become a party to the
Guarantee and Collateral Agreement and (B) to take such actions
necessary or advisable to grant to the Lender a perfected first
priority security interest in the Collateral described in the
Guarantee and Collateral Agreement with respect to such
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new Subsidiary, including, without limitation, the filing of Uniform
Commercial Code financing statements in such jurisdictions as may be
required by the Guarantee and Collateral Agreement or by law or as may
be requested by the Lender, and (iv) if requested by the Lender,
deliver to the Lender legal opinions relating to the matters described
above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to the Lender.
(d) With respect to any new Excluded Foreign Subsidiary
created or acquired after the Closing Date by the Borrower or any of
its Subsidiaries, promptly (i) execute and deliver to the Lender such
amendments to the Guarantee and Collateral Agreement as the Lender
deems necessary or advisable in order to grant to the Lender, a
perfected first priority security interest in the Capital Stock of
such new Subsidiary which is owned by the Borrower or any of its
Subsidiaries (provided that in no event shall more than 65% of the
total outstanding Capital Stock of any such new Subsidiary be required
to be so pledged), (ii) deliver to the Lender the certificates
representing such Capital Stock, together with undated stock powers,
in blank, executed and delivered by a duly authorized officer of the
Borrower or such Subsidiary, as the case may be and (iii) if requested
by the, deliver to the Lender legal opinions relating to the matters
described above, which opinions shall be in form and substance, and
from counsel, reasonably satisfactory to the Lender.
5.10 Landlord's Consents. The Borrower shall use commercial best
efforts to provide to the Lender a landlord's consent for each leased property
occupied, operated or otherwise leased by the Borrower in form and substance
satisfactory to the Lender on or before the 45th day following the Closing
Date.
SECTION 6. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Loan or other amount
is owing to the Lender hereunder, the Borrower shall not, and shall not permit
any of its Subsidiaries to, directly or indirectly:
6.1 Limitation on Indebtedness. Create, incur, assume or suffer to
exist (in each case, to "Incur") any Indebtedness, except:
(a) Indebtedness of any Loan Party pursuant to any Loan
Document;
(b) Capital Lease Obligations in an aggregate principal
amount not to exceed $100,000 at any one time outstanding;
(c) Indebtedness outstanding on the date hereof and listed
on Schedule 6.1(c); and
(d) guarantees made in the ordinary course of business by
the Borrower or any of its Subsidiaries of obligations of any
Wholly Owned Subsidiary Guarantor.
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6.2 Limitation on Liens. Create, incur, assume or suffer to exist
any Lien upon any of its Property or revenues, whether now owned or hereafter
acquired, except for:
(a) Liens for taxes not yet due or which are being
contested in good faith by appropriate proceedings, provided that
adequate reserves with respect thereto are maintained on the books of
the Borrower or its Subsidiaries, as the case may be, in conformity
with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business which are not overdue for a period of more than 30 days or
which are being contested in good faith by appropriate proceedings;
(c) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security
legislation;
(d) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory
obligations, surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business;
(e) easements, rights-of-way, restrictions and other
similar encumbrances incurred in the ordinary course of business
which, in the aggregate, are not substantial in amount and which do
not in any case materially detract from the value of the property
subject thereto or materially interfere with the ordinary conduct of
the business of the Borrower or any of its Subsidiaries;
(f) Liens in existence on the date hereof listed on
Schedule 6.2(f);
(g) Liens created pursuant to the Security Documents; and
(h) any interest or title of a lessor under any lease
entered into by the Borrower or any other Subsidiary in the ordinary
course of its business and covering only the assets so leased.
6.3 Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, lease, assign,
transfer or otherwise dispose of, all or substantially all of its property,
business or assets, or make any material change in its present method of
conducting business.
6.4 Limitation on Sale of Assets. Convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary's Capital Stock to any Person, except:
(a) the sale or other disposition of obsolete or worn out
property in the ordinary course of business;
(b) the sale of inventory in the ordinary course of
business; and
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(c) the sale or issuance of any Subsidiary's Capital Stock to the
Borrower or any Wholly Owned Subsidiary Guarantor.
6.5 Limitation on Dividends. Declare or pay any dividend (other than
dividends payable solely in common stock of the Person making such dividend)
on, or make any payment on account of, or set apart assets for a sinking or
other analogous fund for, the purchase, redemption, defeasance, retirement or
other acquisition of, any shares of any class of Capital Stock of the Borrower
or any Subsidiary or any warrants or options to purchase any such Capital
Stock, whether now or hereafter outstanding, or make any other distribution in
respect thereof, either directly or indirectly, whether in cash or property or
in obligations of the Borrower or any Subsidiary (collectively, "Restricted
Payments"), except that any Subsidiary may make Restricted Payments to the
Borrower or any Wholly Owned Subsidiary Guarantor. Notwithstanding any other
provision of this Agreement, upon the complete and final payment of the
Obligations hereunder and the consummation of the acquisition under the Asset
Purchase Agreement, then the Borrower may declare or pay a dividend solely from
cash that constitutes "Excluded Assets" as defined in the Asset Purchase
Agreement.
6.6 Limitation on Capital Expenditures. Make or commit to make (by
way of the acquisition of securities of a Person or otherwise) any Capital
Expenditure, except (a) Capital Expenditures of the Borrower and its
Subsidiaries in the ordinary course of business not exceeding $300,000.
6.7 Limitation on Investments, Loans and Advances. Make any advance,
loan, extension of credit (by way of guaranty or otherwise) or capital
contribution to, or purchase any stock, bonds, notes, debentures or other
securities of or any assets constituting a business unit of, or make any other
investment in, any Person, except:
(a) extensions of trade credit in the ordinary course of
business;
(b) investments in Cash Equivalents;
(c) Guarantee Obligations permitted by Section 6.1; and
(d) investments by the Borrower or any of its Subsidiaries
in the Borrower or any Wholly Owned Subsidiary Guarantor.
6.8 Limitation on Transactions with Affiliates. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of Property or the rendering of any service, with any Affiliate (other
than the Borrower or any Wholly Owned Subsidiary Guarantor) unless such
transaction is (a) otherwise permitted under this Agreement, (b) in the
ordinary course of business of the Borrower or such Subsidiary, as the case may
be, and (c) upon fair and reasonable terms no less favorable to the Borrower or
such Subsidiary, as the case may be, than it would obtain in a comparable arm's
length transaction with a Person which is not an Affiliate.
6.9 Limitation on Sales and Leasebacks. Enter into any arrangement
with any Person providing for the leasing by the Borrower or any Subsidiary of
real or personal property which has been or is to be sold or transferred by the
Borrower or such Subsidiary to such Person or to
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any other Person to whom funds have been or are to be advanced by such Person
on the security of such property or rental obligations of the Borrower or such
Subsidiary.
6.10 Limitation on Changes in Fiscal Periods. Permit the fiscal year
of the Borrower to end on a day other than December 31 or change the Borrower's
method of determining fiscal quarters.
6.11 Limitation on Negative Pledge Clauses. Enter into with any
Person, or suffer to exist, any agreement, other than (a) this Agreement and
the other Loan Documents and (b) in the case of clause (i) below only, any
agreements governing any purchase money Liens or Capital Lease Obligations
otherwise permitted hereby (in which case, any prohibition or limitation shall
only be effective against the assets financed thereby), which prohibits or
limits the ability of the Borrower or any of its Subsidiaries to (i) create,
incur, assume or suffer to exist any Lien upon any of its Property or revenues,
whether now owned or hereafter acquired, or (ii) pay dividends or make other
distributions, or pay any Indebtedness owed, to the Borrower or any of its
Subsidiaries.
6.12 Limitation on Lines of Business. Enter into any business,
either directly or through any Subsidiary, except for those businesses in which
the Borrower and its Subsidiaries are engaged on the date of this Agreement.
6.13 Limitation on Amendments to Acquisition Documents. (a) Amend,
supplement or otherwise modify (pursuant to a waiver or otherwise) the terms
and conditions of the Asset Purchase Agreement.
SECTION 7. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of the
Loan when due in accordance with the terms hereof; or
(b) The Borrower shall fail to pay any interest on the
Loan, or any other amount payable hereunder or under any other Loan
Document, when due in accordance with the terms hereof, and such
failure to pay shall continue unremedied for a period of five days; or
(c) Any representation or warranty made or deemed made by
any Loan Party herein or in any other Loan Document or which is
contained in any certificate, document or financial or other statement
furnished by it at any time under or in connection with this Agreement
or any such other Loan Document shall prove to have been inaccurate in
any material respect on or as of the date made or deemed made; or
(d) Any Loan Party shall default in the observance or
performance of any agreement contained in clause (i) or (ii) of
Section 5.4(a) (with respect to the Borrower only), Section 5.7(a),
Section 6, Section 5 of the Guarantee and Collateral Agreement or
Section 3 of any Mortgage; or
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(e) Any Loan Party shall default in the observance or
performance of any other agreement contained in this Agreement or any
other Loan Document (other than as provided in paragraphs (a) through
(c) of this Section), and such default shall continue unremedied for a
period of 30 days after notice from the Lender; or
(f) The Borrower or any of its Subsidiaries shall (i)
default in making any payment of any principal of any Indebtedness
(including, without limitation, any Guarantee Obligation, but
excluding the Loans) on the scheduled or original due date with
respect thereto; or (ii) default in making any payment of any interest
on any such Indebtedness beyond the period of grace, if any, provided
in the instrument or agreement under which such Indebtedness was
created; or (iii) default in the observance or performance of any
other agreement or condition relating to any such Indebtedness or
contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause,
or to permit the holder or beneficiary of such Indebtedness (or a
trustee or agent on behalf of such holder or beneficiary) to cause,
with the giving of notice if required, such Indebtedness to become due
prior to its stated maturity or (in the case of any such Indebtedness
constituting a Guarantee Obligation) to become payable; provided, that
a default, event or condition described in clause (i), (ii) or (iii)
of this paragraph (e) shall not at any time constitute an Event of
Default under this Agreement unless, at such time, one or more
defaults, events or conditions of the type described in clauses (i),
(ii) and (iii) of this paragraph (e) shall have occurred and be
continuing with respect to Indebtedness the outstanding principal
amount of which exceeds in the aggregate $50,000; or
(g) (i) The Borrower or any of its Subsidiaries shall
commence any case, proceeding or other action (A) under any existing
or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking
to have an order for relief entered with respect to it, or seeking to
adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution,
composition or other relief with respect to it or its debts, or (B)
seeking appointment of a receiver, trustee, custodian, conservator or
other similar official for it or for all or any substantial part of
its assets, or the Borrower or any of its Subsidiaries shall make a
general assignment for the benefit of its creditors; or (ii) there
shall be commenced against the Borrower or any of its Subsidiaries any
case, proceeding or other action of a nature referred to in clause (i)
above which (A) results in the entry of an order for relief or any
such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall
be commenced against the Borrower or any of its Subsidiaries any case,
proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets which results in the entry of an order
for any such relief which shall not have been vacated, discharged, or
stayed or bonded pending appeal within 60 days from the entry thereof;
or (iv) the Borrower or any of its Subsidiaries shall take any action
in furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii), or
(iii) above; or (v) the Borrower or any of its Subsidiaries shall
generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due; or
32
<PAGE> 37
(h) (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of
the Code) involving any Plan, (ii) any "accumulated funding
deficiency" (as defined in Section 302 of ERISA), whether or not
waived, shall exist with respect to any Plan or any Lien in favor of
the PBGC or a Plan shall arise on the assets of the Borrower or any
Commonly Controlled Entity, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee appointed,
or a trustee shall be appointed, to administer or to terminate, any
Single Employer Plan, which Reportable Event or commencement of
proceedings or appointment of a trustee is, in the reasonable opinion
of the Lender, likely to result in the termination of such Plan for
purposes of Title IV of ERISA, (iv) any Single Employer Plan shall
terminate for purposes of Title IV of ERISA, (v) the Borrower or any
Commonly Controlled Entity shall, or in the reasonable opinion of the
Lender is likely to, incur any liability in connection with a
withdrawal from, or the Insolvency or Reorganization of, a
Multiemployer Plan or (vi) any other event or condition shall occur or
exist with respect to a Plan; and in each case in clauses (i) through
(vi) above, such event or condition, together with all other such
events or conditions, if any, could, in the sole judgment of the
Lender, reasonably be expected to have a Material Adverse Effect; or
(i) One or more judgments or decrees shall be entered
against the Borrower or any of its Subsidiaries involving in the
aggregate a liability (not paid or fully covered by insurance as to
which the relevant insurance company has acknowledged coverage) of
$50,000 or more, and all such judgments or decrees shall not have been
vacated, discharged, stayed or bonded pending appeal within 30 days
from the entry thereof; or
(j) Any of the Security Documents shall cease, for any
reason, to be in full force and effect, or any Loan Party or any
Affiliate of any Loan Party shall so assert, or any Lien created by
any of the Security Documents shall cease to be enforceable and of the
same effect and priority purported to be created thereby; or
(k) The guarantee contained in Section 2 of the Guarantee
and Collateral Agreement shall cease, for any reason, to be in full
force and effect or any Loan Party or any Affiliate of any Loan Party
shall so assert; or
(l) The loss, suspension, revocation or material adverse
modification of any FCC main station license of any of the Stations;
or
(m) Paul W. Robinson, Jr. shall cease to have the power,
directly or indirectly, to vote or direct the voting of securities
having a majority of the ordinary voting power for the election of
directors of the general partner of the Borrower; or
(n) An "Event of Default" as defined under the Asset
Purchase Agreement shall occur and be continuing;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Commitment shall immediately terminate and the Loan (with
accrued interest thereon) and all other amounts owing under this Agreement and
the other Loan Documents shall immediately become due and payable,
33
<PAGE> 38
and (B) if such event is any other Event of Default, the Lender may, by notice
to the Borrower, declare the Loan (with accrued interest thereon) and all other
amounts owing under this Agreement and the other Loan Documents to be due and
payable forthwith, whereupon the same shall immediately become due and payable.
SECTION 8. THE LENDER
8.1 Delegation of Duties. The Lender may execute any of its duties
under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Lender shall not be responsible for the
negligence or misconduct of any agents or attorneys in-fact selected by it with
reasonable care.
8.2 Reliance by Lender. The Lender shall be entitled to rely, and
shall be fully protected in relying, upon any instrument, writing, resolution,
notice, consent, certificate, affidavit, letter,telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to
be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Borrower), independent accountants and other
experts selected by the Lender.
SECTION 9. MISCELLANEOUS
9.1 Amendments and Waivers. Neither this Agreement, any other Loan
Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 9.1. The
Lender and each Loan Party to the relevant Loan Documents may, from time to
time, (a) enter into written amendments, supplements or modifications hereto
and to the other Loan Documents for the purpose of adding any provisions to
this Agreement or the other Loan Documents or changing in any manner the rights
of the Lender or of the Loan Parties hereunder or thereunder or (b) waive, on
such terms and conditions as the Lender may specify in such instrument, any of
the requirements of this Agreement or the other Loan Documents or any Default
or Event of Default and its consequences. Any such waiver and any such
amendment, supplement or modification shall be binding upon the Loan Parties,
the Lender and all future holders of the Loan. In the case of any waiver, the
Loan Parties and the Lender shall be restored to their former position and
rights hereunder and under the other Loan Documents, and any Default or Event
of Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
9.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice,
when received, addressed as follows in the case of the Borrower and the Lender,
and as set forth in an administrative questionnaire delivered to the Lender, or
to such other address as may be hereafter notified by the respective parties
hereto:
The Borrower: EMERALD CITY RADIO PARTNERS, L.P.
1090 Vermont Avenue N.W.
34
<PAGE> 39
Suite 800
Washington, D.C. 20005
Attention: Mr. Paul W. Robinson, Jr.
Telecopy: (202) 408-1590
The Lender: COMMODORE MEDIA, INC.
500 Fifth Avenue
Suite 3000
New York, New York 10110
Attention: Mr. James T. Shea, Jr.
Telecopy:
with a copy to:
Capstar Broadcasting Partners, Inc.
600 Congress Avenue
Suite 1400
Austin, Texas 78701
Attention: Mr. Paul D. Stone
Telecopy: (512) 404-6850
provided that any notice, request or demand to or upon the Lender shall not be
effective until received.
9.3 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
9.4 Survival of Representations and Warranties. All representations
and warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of
the Loans hereunder.
9.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Lender for all its costs and expenses incurred in connection with
the enforcement or preservation of any rights under this Agreement, the other
Loan Documents and any such other documents, including, without limitation, the
fees and disbursements of counsel (including the allocated fees and expenses of
in-house counsel) to the Lender, (b) to pay, indemnify, and hold the Lender
harmless from, any and all recording and filing fees and any and all
liabilities with respect to, or resulting from any delay in paying, stamp,
excise and other taxes, if any, which may be payable or determined to be
payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, the other Loan Documents and any such other documents, and (c)
to pay, indemnify, and hold the Lender's respective officers, directors,
employees, affiliates, agents and controlling persons (each, an "indemnitee")
harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect
35
<PAGE> 40
to the execution, delivery, enforcement, performance and administration of this
Agreement, the other Loan Documents and any such other documents, including,
without limitation, any of the foregoing relating to the use of proceeds of the
Loans or the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of the Borrower any of its
Subsidiaries or any of the Properties (all the foregoing in this clause (c),
collectively, the "indemnified liabilities"), provided, that the Borrower shall
have no obligation hereunder to any indemnitee with respect to indemnified
liabilities to the extent such indemnified liabilities are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from the gross negligence or willful misconduct of such indemnitee. The
agreements in this Section 9.5 shall survive repayment of the Loans and all
other amounts payable hereunder.
9.6 Successors and Assigns; Participations and Assignments.
(a) This Agreement shall be binding upon and inure to the
benefit of the Borrower, the Lender, all future holders of the Loan
and their respective successors and assigns, except that the Borrower
may not assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of the Lender.
(b) The Lender may, without the consent of the Borrower, in
accordance with applicable law, at any time sell to one or more banks,
financial institutions or other entities (each, a "Participant")
participating interests in the Loan or any other interest of the
Lender hereunder and under the other Loan Documents. In the event of
any such sale by the Lender of a participating interest to a
Participant, the Lender's obligations under this Agreement to the
other parties to this Agreement shall remain unchanged, the Lender
shall remain solely responsible for the performance thereof, the
Lender shall remain the holder of the Loan for all purposes under this
Agreement and the other Loan Documents, and the Borrower shall
continue to deal solely and directly with the Lender in connection
with the Lender's rights and obligations under this Agreement and the
other Loan Documents. In no event shall any Participant under any
such participation have any right to approve any amendment or waiver
of any provision of any Loan Document, or any consent to any departure
by any Loan Party therefrom, except to the extent that such amendment,
waiver or consent would reduce the principal of, or interest on, the
Loan or any fees payable hereunder, or postpone the date of the final
maturity of the Loan, in each case to the extent subject to such
participation. The Borrower agrees that if amounts outstanding under
this Agreement and the Loan are due or unpaid, or shall have been
declared or shall have become due and payable upon the occurrence of
an Event of Default, each Participant shall, to the maximum extent
permitted by applicable law, be deemed to have the right of setoff in
respect of its participating interest in amounts owing under this
Agreement to the same extent as if the amount of its participating
interest were owing directly to it as the Lender under this Agreement,
provided that, in purchasing such participating interest, such
Participant shall be deemed to have agreed to share with the Lender
the proceeds thereof as provided in Section 9.7(a) as fully as if it
were the Lender hereunder. The Borrower also agrees that each
Participant shall be entitled to the benefits of Sections 2.9, 2.10
and 2.11 with respect to its participation in the Loan outstanding
from time to time as if it was the Lender; provided that, in the case
of Section 2.10, such Participant shall have complied with the
requirements of said Section and provided,
36
<PAGE> 41
further, that no Participant shall be entitled to receive any greater
amount pursuant to any such Section than the transferor Lender would
have been entitled to receive in respect of the amount of the
participation transferred by such transferor Lender to such
Participant had no such transfer occurred.
(c) The Lender may, in accordance with applicable law, at
any time and from time to time assign to any affiliate of the Lender
or, with the consent of the Borrower (which, in each case, shall not
be unreasonably withheld or delayed), to an additional bank, financial
institution or other entity (an "Assignee") all or any part of its
rights and obligations under this Agreement. Notwithstanding any
provision of this Section 9.6, the consent of the Borrower shall not
be required, and, unless requested by the Assignee or the Lender, a
new Note(s) shall not be required to be executed and delivered by the
Borrower, for any assignment which occurs at any time when any of the
events described in Section 7(f) shall have occurred and be
continuing.
(d) (i) The Loan shall be evidenced by a Note issued by
the Borrower, substantially in the form of Exhibit F, payable to the
order of the Lender and its registered assigns. The Lender is hereby
authorized to record, on the schedule annexed to and constituting a
part of the Note, information regarding the Loan, and any such
recordation shall constitute prima facie evidence of the accuracy of
the information so recorded, provided that the failure to make any
such recordation or any error in such recordation shall not affect the
Borrower's obligations hereunder or under the Note. On or prior to
the effective date of any assignment by the Lender hereunder, the
Borrower, at its own expense, shall execute and deliver to the Lender,
in exchange for the relevant Note, new Notes to the order of the
Assignee and, if applicable, the Lender. Such new Notes shall be
dated the Closing Date and shall otherwise be in the form of the Note
replaced thereby.
(e) The Borrower authorizes the Lender to disclose to any
Participant or Assignee (each, a "Transferee") and any prospective
Transferee any and all financial information concerning the Loan
Parties and their respective affiliates which has been delivered to
the Lender by or on behalf of any Loan Party pursuant to this
Agreement or any other Loan Document or which has been delivered to
the Lender by or on behalf any Loan Party in connection with the
Lender's credit evaluation of the Loan Parties and their respective
affiliates.
9.7 Setoff. In addition to any rights and remedies of the Lender
provided by law, the Lender shall have the right, without prior notice to the
Borrower, any such notice being expressly waived by the Borrower to the extent
permitted by applicable law, upon any amount becoming due and payable by the
Borrower hereunder (whether at the stated maturity, by acceleration or
otherwise) to set off and appropriate and apply against such amount any and all
deposits (general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by the Lender or any affiliate thereof to
or for the credit or the account of the Borrower. The Lender agrees promptly
to notify the Borrower after any such setoff and application made, provided
that the failure to give such notice shall not affect the validity of such
setoff and application.
37
<PAGE> 42
9.8 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by telecopy), and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
9.9 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
9.10 Integration. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Lender with respect to the subject
matter hereof, and there are no promises, undertakings, representations or
warranties by the Lender relative to subject matter hereof not expressly set
forth or referred to herein or in the other Loan Documents.
9.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
9.12 Submission To Jurisdiction; Waivers. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action
or proceeding relating to this Agreement and the other Loan Documents
to which it is a party, or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general jurisdiction
of the Courts of the State of New York, the courts of the United
States of America for the Southern District of New York, and appellate
courts from any thereof;
(b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding was brought in an
inconvenient court and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage
prepaid, to the Borrower, as the case may be at its address set forth
in Section 11.2 or at such other address of which the Lender shall
have been notified pursuant thereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or
shall limit the right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law,
any right it may have to claim or recover in any legal action or
proceeding referred to in this Section 9.12 any special, exemplary,
punitive or consequential damages.
38
<PAGE> 43
9.13 Acknowledgments. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents;
(b) the Lender has no fiduciary relationship with or duty
to the Borrower arising out of or in connection with this Agreement or
any of the other Loan Documents, and the relationship between the
Lender and the Borrower, in connection herewith or therewith is solely
that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions
contemplated hereby among the Borrower and the Lender.
9.14 WAIVERS OF JURY TRIAL. THE BORROWER AND THE LENDER HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
9.15 Confidentiality. The Lender agrees to keep confidential all
non-public information provided to it by any Loan Party pursuant to this
Agreement that is designated by such Loan Party as confidential; provided that
nothing herein shall prevent the Lender from disclosing any such information
(a) to any Transferee or prospective Transferee which agrees to comply with the
provisions of this Section 9.15, (b) to the employees, directors, agents,
attorneys, accountants and other professional advisors of the Lender or its
affiliates, (c) upon the request or demand of any Governmental Authority having
jurisdiction over the Lender, (d) in response to any order of any court or
other Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (e) if requested or required to do so in connection with
any litigation or similar proceeding, (f) which has been publicly disclosed
other than in breach of this Section 9.15, or (g) in connection with the
exercise of any remedy hereunder or under any other Loan Document.
9.16 FCC Approvals.
(a) The Borrower agrees to take any action which the Lender
may reasonably request in order to obtain and enjoy the full rights
and benefits granted to the Lender hereby, including specifically, at
the Borrower's own cost and expense, the use of reasonable efforts to
assist in obtaining approval of the FCC which is then required by law
for any action or transaction contemplated hereby. Specifically, and
without limiting the generality of the foregoing, the Borrower agrees,
upon written request of the Lender following and during the
continuance of an Event of Default and termination of the Asset
Purchase Agreement, to prepare, sign and file with the FCC the
assignor's or transferor's portion of any application or applications
for consent to the assignment of license necessary or appropriate
under the Communications Act, for approval of any sale, assignment or
transfer to the Lender or any other Person of any or all Collateral
(including without limitation any Station Licenses of the Borrower, to
the extent such licenses may constitute Collateral under applicable
law). The Borrower agrees that if it fails or refuses promptly to
prepare, sign or file any such documents following such
39
<PAGE> 44
request rightfully made, such documents may be prepared, signed and
filed on behalf of the Borrower pursuant to one or more court orders.
The Borrower agrees and acknowledges that, following and during the
continuance of an Event of Default and termination of the Asset
Purchase Agreement, any such assignment of the Station Licenses may be
made, among other things, to a receiver, trustee, or similar official
or to any purchaser of all or part of the other Collateral pursuant to
any court order, public or private sale, judicial sale, foreclosure or
the exercise of any other remedies available to the Lender hereunder
or under applicable law.
(b) The Borrower acknowledges that FCC authorization of the
actions contemplated by this Section 9.16 is integral to the Lender's
realization of the value of the Collateral, that is Station Licenses
are unique assets, that there is no adequate remedy at law for failure
by the Borrower to comply with the provisions of this Section 9.16 and
that such failure would not be adequately compensable in monetary
damages; therefore, the Borrower agrees that, in addition to all other
remedies available at law or in equity, the Lender shall be entitled
to obtain decree(s) of the specific performance entitling it to
temporary restraining order(s), preliminary injunction(s), or
permanent injunction(s) to specifically enforce and require specific
performance of the provisions of this Section 9.16. The Borrower
agrees that notice shall be adequate for the entry of a decree of
specific performance in respect of any such matter (i) in the case of
a temporary restraining order, upon twenty-four (24) hours' prior
notice of the hearing thereof and (ii) in the case of any other
proceeding, upon five (5) days' prior notice of the hearing thereof,
and hereby waives all requirements and demands that the Lender give
any greater notice of such hearings and further waives all
requirements and demands that the Lender post a bond or other surety
arrangement in connection with the issuance of such decree.
(c) The parties acknowledge their intent that, upon
acceleration or maturity of the obligations secured hereby, the Lender
shall receive, to the fullest extent permitted by applicable law and
governmental policy (including, without limitation, the Communications
Act), all rights necessary or desirable to obtain, use, sell or assign
the Station Licenses of the Borrower, the Stations and the other
Collateral, and to exercise all remedies available to them hereunder
and under applicable law. The parties further acknowledge and agree
that if changes in law or governmental policy occur subsequent to the
date hereof that affect in any manner the Lender's rights to access,
use, assign or sell such Station License, Stations or other
Collateral, or the procedures necessary to enable such access, use,
assignment or sale, the Lender and the Borrower shall amend this
Agreement in such manner as the Lender shall reasonably request based
upon advice of the Lender's counsel (such request to be accompanied by
reasonable evidence of such change in law or governmental policy which
need not be in writing), in order to provide the Lender such rights to
the greatest extent possible consistent with then applicable law and
governmental policy.
9.17 ENTIRE AGREEMENT. THE NOTE, THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS EMBODY THE ENTIRE AGREEMENT AND UNDERSTANDING BETWEEN THE LENDER AND
THE OTHER RESPECTIVE PARTIES HERETO AND THERETO AND SUPERSEDE ALL PRIOR
AGREEMENTS AND UNDERSTANDINGS BETWEEN SUCH PARTIES RELATING TO THE SUBJECT
MATTER HEREOF AND THEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
40
<PAGE> 45
CONTEMPORANEOUS AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
9.18 Effectiveness. This Agreement shall not be effective until
delivered to the Lender in the State of New York and accepted by the Lender in
such State, and executed by the Lender in such State.
41
<PAGE> 46
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.
EMERALD CITY RADIO PARTNERS, L.P.
By: Cyclone Communications Corporation, its
General Partner
By: /s/ PAUL W. ROBINSON, JR.
----------------------------------------------
Name: Paul W. Robinson, Jr.
Title: President
COMMODORE MEDIA, INC.,
as Lender
By: /s/ JAMES T. SHEA, JR.
----------------------------------------------
Name: James T. Shea, Jr.
Title: President
<PAGE> 1
EXHIBIT 21.1
LIST OF SUBSIDIARIES OF THE COMPANY
1. Commodore Holdings, Inc., a Delaware corporation, is a wholly-owned
subsidiary of the Company.
2. The following entities are wholly-owned subsidiaries of Commodore
Holdings, Inc.:
a. Commodore Media of Delaware, Inc., a Delaware corporation.
b. Commodore Media of Pennsylvania, Inc., a Delaware corporation.
c. Commodore Media of Florida, Inc., a Delaware corporation.
d. Commodore Media of Kentucky, Inc., a Delaware corporation.
e. Commodore Media of Norwalk, Inc., a Delaware corporation.
f. Commodore Media of Westchester, Inc., a Delaware corporation.
3. Danbury Broadcasting, Inc., a Connecticut corporation, is a
wholly-owned subsidiary of Commodore Media of Norwalk, Inc.
4. Osborn Communications Corporation, a Delaware corporation, is a
wholly-owned subsidiary of the Company.
5. The following entities are wholly-owned subsidiaries of Osborn
Communications Corporation:
a. Atlantic City Broadcasting Corp., a Delaware corporation.
b. Breadbasket Broadcasting Corporation, a Delaware corporation.
c. Houndstooth Broadcasting Corporation, a Delaware corporation.
d. O.C.C., Inc., a Delaware corporation.
e. Osborn Entertainment Enterprises Corporation, a Delaware corporation.
f. SNG Holdings, Inc., a Delaware corporation.
g. Southeast Radio Holding Corp., a Delaware corporation.
h. Ameron Broadcasting Corporation, a Delaware corporation.
i. WNOK Acquisition Company, Inc., a Delaware corporation.
6. The following entities are wholly-owned subsidiaries of O.C.C., Inc.:
a. Ladner Communications Holding Corp., a Delaware corporation.
b. Mountain Radio Corporation, a Delaware corporation.
c. Orange Communications, Inc., a Delaware corporation.
d. RKZ Television, Inc., a Delaware corporation.
e. Yellow Brick Radio Corporation, a Delaware corporation.
<PAGE> 2
7. The following entities are wholly-owned subsidiaries of Osborn
Entertainment Enterprises Corporation:
a. Jamboree in the Hills, Inc., a Delaware corporation.
b. Music Hall Club, Inc., a West Virginia corporation.
8. The following entities are wholly-owned subsidiaries of SNG Holdings,
Inc.:
a. Great American East, Inc., a North Carolina corporation.
b. Nelson Broadcasting Corporation, a Delaware corporation.
c. Short Broadcasting Corporation, a Delaware corporation.
9. The following entities are wholly-owned subsidiaries of Southeast
Radio Holding Corp.:
a. Asheville Broadcasting Corp., a Delaware corporation.
b. Corkscrew Broadcasting Corporation, a Delaware corporation.
c. Daytona Beach Broadcasting Corp., a Delaware corporation.
d. Rainbow Broadcasting Corporation, a Delaware corporation.
10. The following entities are wholly-owned subsidiaries of Ladner
Communications Holding Corp.:
a. Beatrice Broadcasting Corporation, a Delaware corporation.
b. Currey Broadcasting Corporation, a Delaware corporation.
c. Osborn Sound & Communications Corp., a Delaware corporation.
d. Waite Broadcasting Corp., a Delaware corporation.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 4,367,847
<SECURITIES> 0
<RECEIVABLES> 9,751,046
<ALLOWANCES> 838,081
<INVENTORY> 0
<CURRENT-ASSETS> 13,724,712
<PP&E> 24,958,328
<DEPRECIATION> 10,695,273
<TOTAL-ASSETS> 95,065,047
<CURRENT-LIABILITIES> 7,408,268
<BONDS> 90,737,274
0
0
<COMMON> 10
<OTHER-SE> (4,830,134)
<TOTAL-LIABILITY-AND-EQUITY> 95,065,047
<SALES> 0
<TOTAL-REVENUES> 45,959,646
<CGS> 0
<TOTAL-COSTS> 3,699,285
<OTHER-EXPENSES> 47,967,953
<LOSS-PROVISION> 593,158
<INTEREST-EXPENSE> 11,474,720
<INCOME-PRETAX> (17,775,470)
<INCOME-TAX> 132,476
<INCOME-CONTINUING> (17,907,946)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (17,907,946)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
