Exhibit 10.3
EMPLOYEE MATTERS AGREEMENT
     This Employee Matters Agreement, dated as of December 21, 2005, is between
Clear Channel Communications, Inc. (“Clear Channel”), a Texas corporation, and
CCE Spinco, Inc. (“Entertainment”), a Delaware corporation.
RECITALS
     WHEREAS, Clear Channel and Entertainment have entered into a Master
Separation and Distribution Agreement dated as of December 20, 2005 (the “Master
Agreement”) pursuant to which all of the outstanding shares of Entertainment’s
common stock will be distributed on a pro rata basis to the holders of Clear
Channel’s common stock (the “Distribution”); and
     WHEREAS, in connection with the Distribution and pursuant to the Master
Agreement, Clear Channel and Entertainment desire to enter into this Employee
Matters Agreement;
     NOW, THEREFORE, in consideration of the mutual agreements contained herein
and in the Master Agreement, the parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
     As used in this Agreement, the following terms shall have the meanings set
forth below.
     1.1 “Clear Channel Entity” means Clear Channel and any subsidiary of Clear
Channel which, before the Distribution shall include the Entertainment Entities
and, from and after the Distribution, will include no Entertainment Entities.
     1.2 “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of
1985, as codified at Part 6 of Subtitle B of Title I of ERISA and at section
4980B of the Code.
     1.3 “Code” means the Internal Revenue Code of 1986, as amended.
     1.4 “Entertainment Employee” means an employee and, as the context
requires, former employee of Entertainment or an Entertainment Entity, as
determined by Clear Channel based upon applicable payroll records.
     1.5 “Entertainment Entity” means Entertainment, any subsidiary of
Entertainment, and any predecessor entity of such subsidiary.
     1.6 “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.
     1.7 “IRS” means the Internal Revenue Service.
     1.8 “Plan,” when immediately preceded by “Clear Channel,” means any
“employee benefit plan” within the meaning of Section 3(3) of ERISA and any
other plan, policy, program, payroll practice, on-going arrangement, contract,
trust, insurance policy or other agreement or

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funding vehicle, as amended from time to time, for which the eligible class(es)
of participants include employees or former employees of Clear Channel or a
Clear Channel Entity, and, when immediately preceded by “Entertainment,” means
any “employee benefit plan” within the meaning of Section 3(3) of ERISA and any
other plan, policy, program, payroll practice, on-going arrangement, contract,
trust, insurance policy or other agreement or funding vehicle, to the extent
amended from time to time, for which the eligible class(es) of participants are
limited to employees or former employees of Entertainment or an Entertainment
Entity, but no other Clear Channel Entity.
     1.9 “Transferred Employee” means an Entertainment Employee described as
such in Section 2.2(a).
     1.10 “Welfare Plan” means any “employee welfare benefit plan” as defined in
section 3(1) of ERISA, without regard to sections 4(b)(4) or 4(b)(5) of ERISA.
ARTICLE 2
GENERAL
     2.1 Assumption/Retention of Liabilities. Except as otherwise explicitly and
specifically provided in this Agreement, effective as of the Distribution date,
Entertainment shall assume or retain, as the case may be, and pay, perform,
fulfill and discharge any and all liabilities or obligations relating to the
employment or termination of employment of any current or former Entertainment
Employee (including any individual who is or was an independent contractor,
temporary employee, temporary service worker, consultant, freelance worker,
agency employee, leased employee, on-call worker, or who performs or performed
services in any other form of non-employee classification), and their dependents
and beneficiaries, regardless of when incurred. No provision in this Agreement
relating to Entertainment’s responsibility with respect to any specific
liabilities or obligations described in the preceding sentence will limit the
generality of the preceding sentence with respect to, or otherwise be construed
to relieve Entertainment from, the assumption or retention of any other
liabilities or obligations described in the preceding sentence.
     2.2 Employment Status of Entertainment Employees.
          (a) Transferred Employees. Except as otherwise provided in this
Agreement, any individual who, immediately prior to the Distribution, is listed
on the applicable payroll records of Clear Channel or Entertainment as an
employee of an Entertainment Entity, whether such individual is actively at work
or absent from work due to vacation, illness, or any other authorized paid or
unpaid leave, will continue to be an employee of such Entertainment Entity
immediately after the Distribution on the same terms and conditions as in effect
immediately before the Distribution, subject in the case of an individual whose
employment is covered by a collective bargaining agreement, to the terms and
provisions of such agreement. Any individual described in the preceding sentence
is considered a “Transferred Employee” for purposes of this Agreement, effective
at the time of the Distribution
          (b) No Clear Channel Severance Event. No Transferred Employee will be
entitled to receive termination or severance payments or benefits from Clear
Channel or any

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other entity which, immediately following the Distribution, is a Clear Channel
Entity as a result of the Distribution or any related circumstance.
Entertainment shall be responsible for the satisfaction of any termination or
severance obligations owed with respect to Transferred Employees and any other
former Entertainment Employees, whether arising before, on or after the
Distribution date.
     2.3 Termination of Participation in Clear Channel Plans. Except as
otherwise specified in this Agreement, each Entertainment Entity which is a
participating employer in a Clear Channel Plan shall cease to be a participating
employer in such Clear Channel Plan at the time of the Distribution or at such
earlier time as Clear Channel, in its discretion, may direct.
     2.4 Recognition of Service. Except as otherwise provided in this Agreement,
Entertainment will cause each Entertainment Plan to grant full credit to each
eligible Transferred Employee for the period of such Transferred Employee’s
service with the Clear Channel Entities (including, where applicable, service
with a predecessor employer credited by a corresponding Clear Channel Plan).
Clear Channel service may be disregarded (a) under a new Entertainment Plan
adopted after the Distribution date if such Plan is not a successor or
replacement plan, and (b) under any Entertainment Plan if and to the extent
credit for such service would result in the duplication of benefits.
ARTICLE 3
WELFARE PLANS
     3.1 Welfare Plan Participation and Liabilities.
          (a) Termination of Group Welfare Plan Participation. Effective at the
time of the Distribution, each of the Entertainment Entities shall cease to be a
participating employer and all Entertainment Employees will cease to be active
participants in any Clear Channel Welfare Plan. Notwithstanding the preceding
sentence, Transferred Employees who, immediately before the Distribution,
participate in Clear Channel’s group medical plan, group dental plan and/or
group life insurance plans will be entitled to continue such participation
through the last day of the calendar month in which the Distribution occurs.
Entertainment will pay Clear Channel the month’s FTE or other charges for such
participation, and will pay or reimburse Clear Channel for any employee
contributions toward that coverage which are due after the Distribution date.
          (b) Allocation of Liabilities. Except as otherwise provided in this
Agreement, (1) Clear Channel shall be responsible for the payment of benefits
with respect to covered liabilities and expenses incurred prior to the
Distribution or, if and to the extent applicable under subsection (a) above,
prior to the end of the month in which the Distribution occurs; and (2) no Clear
Channel Entity shall have any responsibility for the payment of benefits with
respect to liabilities and expenses incurred by any such persons after the
Distribution or the end of the month in which the Distribution occurs, as the
case may be, even though such liabilities or expenses would have been covered by
a Clear Channel Welfare Plan if they were incurred before such time. Nothing
contained in this subsection is intended to affect the rights of any current or
former Entertainment Employee or any of their covered dependents and
beneficiaries to receive insurance benefits payable under and in accordance with
the provisions of an insurance policy maintained as part of a Clear Channel
Welfare Plan.

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          (c) Entertainment Group Health Plan; COBRA. Prior to the end of the
month in which the Distribution occurs and effective as of the first day of the
following month, Entertainment will adopt and cause to have in place a group
health plan (including medical and dental) for the benefit of Transferred
Employees and their eligible dependents. Entertainment shall assume sole
responsibility for providing COBRA group health plan continuation coverage to
any Entertainment Employees (and their covered dependents) who, at the time of
the Distribution, are receiving or entitled to receive COBRA continuation
coverage by reason of a qualifying event occurring at or before such time, and
to any Transferred Employees (and their covered dependents) who suffer a
qualifying event after the Distribution. Clear Channel shall have no
responsibility for, and shall be entitled to indemnification by Entertainment
with respect to, any COBRA obligations to current or former Entertainment
Employees (and their covered dependents) for which Entertainment is responsible,
whether by operation of law or in accordance with the terms of this Agreement
(including, without limitation, this Section 3.1(c).
     3.2 Disability Plans.
          (a) Short-Term Disability Benefits. Entertainment shall be responsible
for all claims for short-term disability benefits for Entertainment Employees
regardless of when made or incurred, except to the extent, if at all, that such
claim is covered by insurance under an insured Clear Channel short-term
disability plan or arrangement and arises prior to termination of coverage
resulting from the Distribution.
          (b) Long-Term Disability Benefits. Clear Channel shall continue to be
responsible after the Distribution for long-term disability benefits payable
with respect to an Entertainment Employee who, at the time of the Distribution,
is absent from active employment due to a total disability as defined in the
Clear Channel long term disability plan, or who is absent from work due to short
term disability which becomes a long term disability, but if (and only if) and
to the extent such long-term disability benefits are covered by insurance
payable by an insurance company under an insured Clear Channel Welfare Plan.
     3.3 Flexible Spending Accounts. Prior to and effective as of the
Distribution date, Entertainment shall adopt and have in place a flexible
spending account plan in which Transferred Employees shall maintain the account
balances and the salary reduction, eligibility, participation and benefit
entitlement status they have immediately prior to the Distribution date under
Clear Channel’s flexible spending account plan. Clear Channel shall pay to
Entertainment the net positive balance, if any, of the Transferred Employees’
flexible spending accounts at the time of the Distribution, and Entertainment
shall pay to Clear Channel the net negative balance, if any, of said accounts.
The determination of the net positive or negative balance of the flexible
spending accounts will be made and communicated by Clear Channel as soon as
practicable after the Distribution date, and payment of the net balance or
deficit will be made promptly after the Distribution. Entertainment shall be
solely responsible for (a) the payment of all Transferred Employees’ claims that
are submitted but unpaid under the Clear Channel flexible spending account plan
at the time of the Distribution, and (b) the processing and payment of all
flexible spending account plan claims submitted by Transferred Employees after
the Distribution. Subject to applicable law, Clear Channel shall provide or make
available to Entertainment copies of records or statements in support of the
claims described in clause (a) of the preceding sentence,

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and, if Clear Channel pays any such claims, it shall be entitled to prompt
reimbursement of such payment(s) by Entertainment.
     3.4 Clear Channel Assets. Except as otherwise provided in the preceding
section (relating to the payment of a net positive flexible spending account
balance), Clear Channel shall retain all claim reserves, bank accounts, trust
funds or other balances maintained as part of or in connection with Clear
Channel’s Welfare Plans.
     3.5 Credit for Amounts Paid. In administering its Welfare Plans for the
calendar year in which the Distribution date occurs, Entertainment shall credit
participating Transferred Employees with any amounts paid by them under the
corresponding Clear Channel Welfare Plans toward satisfaction of applicable
deductibles, co-payments, coinsurance and out-of-pocket maximums.
ARTICLE 4
COMPENSATION MATTERS
AND NON-ERISA BENEFIT ARRANGEMENTS
     4.1 Assumption of Individual Agreements. Effective on the Distribution
date, Entertainment will assume and/or be responsible for satisfying any and all
obligations and liabilities (fixed or contingent) of Clear Channel or any Clear
Channel Entity incurred or arising under or in connection with any individual
employment, retention, separation, consulting, representation or other personal
services-related agreements (together with any ancillary trust or other
agreements) made directly or indirectly with or for the benefit of (a) any
Transferred Employees, or (b) other individuals or personal service entities in
connection with the business of any Entertainment Entity; provided, however,
that, following the Distribution date, Clear Channel and the other Clear Channel
Entities shall retain any rights which it or any of them would have had
following the termination of any such agreement, determined as if the agreement
terminated immediately prior to the Distribution, except to the extent that the
exercise of such rights by Clear Channel and the other Clear Channel Entities
following the Distribution date would adversely affect the rights of any
Entertainment Entity under such agreement. Entertainment shall indemnify Clear
Channel and its subsidiaries and affiliates and hold them and each of them
harmless from, against and with respect to any claim, liability or expense
asserted or imposed by it or any of them under or in connection with any of the
agreements described in the first sentence of this Section 4.1.
     4.2 Stock Incentive Plans.
          (a) Stockholder Approval of Incentive Plan. Prior to the Distribution
date, Clear Channel shall cause Entertainment to adopt and, as Entertainment’s
sole stockholder, to approve the adoption of a 2005 Stock Incentive Plan for
eligible Entertainment employees, directors and other personnel, with terms and
conditions substantially similar to the terms and conditions of the Clear
Channel Communications, Inc. 2001 Stock Incentive Plan.
          (b) Outstanding Clear Channel Stock Options. As authorized by the
Compensation Committee of the Board of Directors of Clear Channel pursuant to
its authority under the Clear Channel stock incentive plans, the number of Clear
Channel shares and the

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exercise price per share covered by outstanding vested Clear Channel stock
options held by Entertainment Employees (or their beneficiaries) at the time of
the Distribution will be adjusted after the Distribution such that the ratio of
the exercise price per share to the per share value of the stock covered by the
option and the aggregate intrinsic value of the option are the same after the
adjustment as before the adjustment. The terms and conditions of the vested
Clear Channel stock options, as adjusted, will otherwise remain the same. Unless
sooner terminated in accordance with their terms, the vested Clear Channel stock
options, as adjusted, held by a Transferred Employee will expire if and to the
extent they are not exercised within the applicable post-employment exercise
period following the Distribution. Non-vested Clear Channel stock options held
by Entertainment Employees will terminate in accordance with their terms at the
time of the Distribution by reason of the cessation of their employment with a
Clear Channel Entity.
          (c) Restricted Stock.
               (i) Distribution of Entertainment Shares. As authorized by the
Compensation Committee of the Board of Directors of Clear Channel pursuant to
its authority under the Clear Channel Communications 2001 Stock Incentive Plan,
Transferred Employees who, immediately before the Distribution, hold restricted
shares of Clear Channel stock, will be entitled to receive a number of fully
vested shares of Entertainment stock equal to the number of shares that would be
distributable with respect to the same number of outstanding non-restricted
shares of Clear Channel stock, subject to such rounding convention as said
Compensation Committee may establish.
               (ii) Clear Channel Restricted Shares. Restricted Clear Channel
shares held by Transferred Employees will be forfeited immediately following the
Distribution.
     4.3 Clear Channel Employee Stock Purchase Plan. Transferred Employees’
payroll deduction contributions under the Clear Channel Communications, Inc.
2000 Employee Stock Purchase Plan (“ESPP”) will terminate on the last pay date
preceding the Distribution date. On the stock purchase date next following the
Distribution date, the amount then credited to each Transferred Employee’s ESPP
payroll deduction account will be applied toward the purchase of Clear Channel
stock. During the 90-day period following the Distribution date, Transferred
Employees will be permitted to direct the sale of the shares of Clear Channel
and Entertainment stock credited to their accounts and the distribution of the
proceeds from such sales. At the end of such 90-day period, each Transferred
Employee will be entitled to receive stock certificates for the number of whole
shares of Clear Channel and Entertainment stock (if any) that remain credited to
such Transferred Employee’s ESPP account, together with cash in lieu of any
fractional shares, all in full and final satisfaction of the Transferred
Employee’s interest in the ESPP. Clear Channel will provide or cause to be
provided to affected Transferred Employees reasonable notice of the effect of
the Distribution on their rights and entitlements under the ESPP.
     4.4 Clear Channel Nonqualified Deferred Compensation Plan. In connection
with the Distribution, Entertainment shall assume the obligations of Clear
Channel and protect and satisfy the rights and entitlements of participating
Entertainment Employees under the Clear Channel Communications, Inc.
Nonqualified Deferred Compensation Plan. Toward that end, effective as

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of the Distribution date, or such earlier or later date as may be determined by
Clear Channel and Entertainment, Clear Channel will cause the Clear Channel
Communications, Inc. Nonqualified Deferred Compensation Plan and the related
trust arrangement, but only as and to the extent they pertain to participating
Entertainment Employees, to become a separate plan and trust arrangement
maintained for the exclusive benefit of Entertainment Employees, which separate
plan will be retained by Entertainment immediately following the Distribution.
The account balances and related elections and entitlements of Entertainment
Employees under the Entertainment plan immediately after the plan spin-off will
be the same as and subject to the same terms and conditions as the corresponding
account balances and related elections and entitlements of the Entertainment
Employees under the Clear Channel plan immediately prior to the plan spin-off.
Clear Channel will cause any assets held in the trust maintained under the Clear
Channel plan to be transferred to the trustee of the trust under the
Entertainment plan. Following the Distribution, neither Clear Channel nor any
Clear Channel Entity nor any of their affiliates will have any liability or
obligation in connection with the prior participation of any Transferred
Employees and other Entertainment Employees in the Clear Channel Communications,
Inc. Nonqualified Deferred Compensation Plan, and Entertainment and its
subsidiaries will be solely responsible for all such liabilities and
obligations.
     4.5 Annual Incentive Compensation.
          (a) Clear Channel Plan for 2005. The Compensation Committee of the
Board of Directors of Entertainment shall be responsible for making any
determinations otherwise required to be made by the committee under the Clear
Channel Communications Annual Incentive Plan for the calendar year in which the
Distribution date occurs with respect to Transferred Employees, if any, who are
“covered employees” within the meaning of Section 162(m) of the Code, including
a determination of (a) the extent to which established performance criteria
(after taking into account the effects of the Distribution and related capital
transactions) have been met, and (b) the payment level for each such Transferred
Employee. Entertainment shall assume all liabilities with respect to the payment
of annual incentive awards to Entertainment Employees for the calendar year of
the Distribution, subject to any deferral elections as are in effect and to the
terms and provisions of the applicable incentive plan.
     4.6 New Entertainment Plan. Prior to the Distribution date, Clear Channel
shall cause Entertainment to adopt and, as Entertainment’s sole stockholder, to
approve the adoption of, and to have in place an annual performance-based
incentive plan for the benefit of designated executive officers and other key
employees, on terms and conditions substantially similar to the terms and
conditions of the Clear Channel Communications, Inc. 2005 Annual Incentive Plan.
     4.7 Workers’ Compensation. Except as otherwise specifically provided
herein, Entertainment shall be solely responsible for all claims for workers’
compensation reported by a Transferred Employee on or after the policy renewal
date of November 1, 2005. Unless Clear Channel determines otherwise, Clear
Channel shall continue to be responsible after the Distribution date for
administering all claims for workers’ compensation for injuries to any
Entertainment Employee occurring prior to November 1, 2005 and reported timely
under the terms of any Clear Channel workers’ compensation policy or plan;
provided, however, that Entertainment shall reimburse, and shall indemnify Clear
Channel for any amounts payable

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under such prior programs or for any claims not reported timely and where Clear
Channel has been prejudiced by such late reporting.
     4.8 Accrued Vacation and other Paid Time Off. Entertainment shall recognize
and assume or retain, as the case may be, all liability for all vacation,
holiday, flex days and sick days, including banked sick days accrued by
Transferred Employees as of the date of the Distribution, on terms and
conditions similar to those in effect immediately before such time.
     4.9 Leaves of Absence. Entertainment shall honor the terms and conditions
of any approved leave of absence of an Entertainment Employee that begins before
and continues immediately after the Distribution.
ARTICLE 5
PENSION PLANS
5.1 Entertainment 401(k) Plan.
          (a) Continuation of Entertainment 401(k) Plan. Effective as of the
Distribution date, Entertainment or another Entertainment Entity designated by
Entertainment shall continue sponsorship of the Clear Channel Entertainment,
Inc. 401(k) Savings Plan, its stand-alone profit sharing/401(k) plan qualified
under Section 401(a) of the Code (the “Entertainment 401(k) Plan”). In addition,
Entertainment or another Entertainment Entity designated by Entertainment shall
establish its own trust intended to be exempt from tax under section 501(a) of
the Code (the “Entertainment 401(k) Trust”) effective as of the Distribution
date, or such earlier or later date as may be determined by Clear Channel and
Entertainment. Effective as of the establishment of the Entertainment 401(k)
Trust, Clear Channel and Entertainment shall take such actions as may be
necessary to accommodate the transfer of assets relating to the Entertainment
401(k) Plan from the existing Clear Channel Master 401(k) Trust to the
Entertainment 401(k) Trust. Entertainment shall assume and thereafter be solely
responsible for all then existing or future employer liabilities related to
Transferred Employees and other Entertainment Employees under the Entertainment
401(k) Plan and the administration thereof. In addition, Entertainment shall
assume and thereafter be solely responsible for all then existing or future
employer liabilities related to Transferred Employees and other Entertainment
Employees under all other existing or previously sponsored plans of
Entertainment as listed on Schedule 5.1(a), Historical Plans Checklist. Included
within these assumed Employer liabilities retained by Entertainment shall
include all Form 5500 reporting, distributions of summary annual reports,
required disclosures to affected employees, participants and beneficiaries,
nondiscrimination and coverage testing, annual audit requirements, IRS/DOL
audits, 11k filing with the SEC and legislative compliance for Plan years ending
on or after the Distribution date.
          (b) Employer Stock Funds. A Clear Channel stock fund will be
established under the Entertainment 401(k) Plan with respect to the shares of
Clear Channel stock held under the Entertainment 401(k) Plan subject to the
following conditions: (1) participants may direct the sale of Clear Channel
stock credited to their accounts but not the purchase of such stock; and
(2) after such time as may be determined by a named fiduciary of the
Entertainment 401(k) Plan, any remaining shares of Clear Channel stock shall be
sold and the cash proceeds re-invested in accordance with procedures established
under the plan. Effective as of the Distribution date, the

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Clear Channel Communications, Inc. 401(k) Savings Plan will be amended to
include a similar wasting investment fund for shares of Entertainment stock
acquired in connection with the Distribution.
ARTICLE 6
GENERAL PROVISIONS
     6.1 No Third Party Beneficiaries; Preservation of Rights to Amend. This
Agreement shall be binding upon and inure to the benefit only of the parties
hereto and their respective successors. Notwithstanding any other provisions to
the contrary, except with respect to such successors, this Agreement is not
intended and shall not be construed for the benefit of any third party or any
person not a signatory hereto. Without limiting the generality of the foregoing:
(a) no Transferred Employee or other current or former employee of Clear Channel
or Entertainment or any subsidiary or affiliate of either (or his/her spouse,
dependent or beneficiary), or any other person not a party to this Agreement,
shall be entitled to assert any claim hereunder; (b) except as expressly
provided in this Agreement, nothing in this Agreement shall preclude
Entertainment or any Entertainment Entity, at any time after the Distribution
date, from amending or terminating any Entertainment Plan; and (c) except as
expressly provided in this Agreement, nothing in this Agreement shall preclude
Clear Channel or any Clear Channel Entity, at any time after the Distribution
date, from amending or terminating any Clear Channel Plan.
     6.2 Employment Solicitation. For a period of one year following the
Distribution date, neither Clear Channel nor Entertainment may, nor will they
permit any of their respective subsidiaries, affiliates or agents to, solicit or
recruit for employment any employees with a position of vice president or higher
currently and then in the employ of the other company or its subsidiaries or
affiliates, without the prior written consent of the other company.
     6.3 Personnel Records. Subject to applicable law, each party shall furnish
or make available to the other copies of such personnel and other documents and
records relating to Entertainment Employees as may be reasonably requested by
the other in connection with the proper administration of its payroll and
Employee Plans or the proper operation of its business or the execution of its
rights and obligations under this Agreement.
     6.4 Applicability to Subsidiaries. Each of Clear Channel and Entertainment
shall cause to be performed, and hereby guarantees the performance of, all
actions, agreements and obligations set forth in this Agreement to be performed
by a Clear Channel Entity or an Entertainment Entity, respectively.
     6.5 Collective Bargaining Agreements. To the extent any provision of this
Agreement is contrary to the provisions of any collective bargaining agreement
to which Clear Channel or any Clear Channel Entity is a party, the terms of such
collective bargaining agreement shall prevail. Entertainment will indemnify
Clear Channel from and against any expenses or claims incurred after the
Distribution in connection with any such collective bargaining agreement insofar
as it relates to Entertainment Employees.
     6.6 Fiduciary Matters. The parties acknowledge that actions required to be
taken pursuant to this Agreement may be subject to fiduciary duties or standards
of conduct under

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ERISA or other applicable law. Neither party shall be deemed to be in violation
of this Agreement if it fails to comply with any provision of this Agreement
based upon its good faith determination that to do so would violate such a
fiduciary duty or standard. Each party shall be responsible for taking such
actions as are deemed necessary and appropriate to comply with its own fiduciary
responsibilities and shall fully release and indemnify the other party for any
liabilities caused by the failure to satisfy any such responsibility.
     6.7 Administrative Complaints/Litigation. As of and after the Distribution
date, Entertainment shall assume, and be solely liable for, the handling,
administration, investigation, and defense of actions, including, without
limitation, ERISA, and any regulations or guidance issued thereunder, the Code
and any regulations or guidance issued thereunder to the extent such Code
provisions relate to or affect employee benefit matters, occupational safety and
health, employment standards, union grievances, wrongful dismissal,
discrimination or human rights and unemployment compensation claims, asserted at
any time against Clear Channel or Entertainment by any Entertainment Employee or
any other person arising out of or relating to employment with Entertainment.
Any obligations, losses, expenses and claims arising from such actions shall be
deemed to be Entertainment Liabilities and shall be retained or assumed, as the
case may be, by Entertainment under and in accordance with the Master Agreement.
Clear Channel reserves the right to participate in the investigation, defense or
settlement of any matter to the extent it deems reasonably necessary.
     6.8 Reimbursement and Indemnification. Each of the parties shall reimburse
the other, within 30 days of receipt from the other party of appropriate
verification, for all costs and expenses which the other may incur in
satisfaction of a liability or obligation which, under this Agreement, is the
liability or obligation of such party. All liabilities retained, assumed or
indemnified against by Entertainment pursuant to this Agreement shall be deemed
Entertainment Liabilities, and all liabilities specifically retained, assumed or
indemnified against by Clear Channel pursuant to this Agreement shall be deemed
Excluded Liabilities for purposes of the Master Agreement.
     6.9 Master Agreement Provisions. The following provisions of the Master
Agreement are hereby incorporated herein by reference and, unless otherwise
expressly specified herein, shall apply as if fully set forth herein: Article VI
(relating to releases and indemnification); the provisions of Articles V and VII
relating to exchange of information and confidentiality; Article VIII (relating
to resolution of disputes); and Article IX (relating to Miscellaneous).
     6.10 Applicable Law. To the extent not preempted by applicable federal law,
this Agreement shall be governed by, construed and interpreted in accordance
with the laws of the State of Texas, without regard to its choice of laws
principles, as to all matters, including matters of validity, construction,
effect, performance and remedies.
[Signature Page Follows]

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     IN WITNESS WHEREOF, the parties have caused this Employee Matters Agreement
to be executed to be effective on the date first written above by their
respective duly authorized officers.

            CLEAR CHANNEL COMMUNICATIONS, INC.
      By:   /s/  Randall T. Mays       Randall T. Mays        Executive Vice
President &
Chief Financial Officer        CCE SPINCO, INC.
      By:   /s/  Michael Rapino       Michael Rapino        Chief Executive
Officer     

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     The undersigned subsidiaries of CCE Spinco, Inc. have caused this Employee
Matters Agreement to be executed to be effective on the date first written above
by their respective duly authorized officers for the purpose of agreeing to be
bound to this Employee Matters Agreement and to be liable, jointly and
severally, with CCE Spinco, Inc. to Clear Channel Communications, Inc. for all
covenants, agreements, liabilities and obligations provided herein or arising
hereunder.

            CCE HOLDCO #1, INC.
      By:   /s/  Michael Rapino       Michael Rapino        Chief Executive
Officer        CCE HOLDCO #2, INC.
      By:   /s/  Michael Rapino       Michael Rapino        Chief Executive
Officer        SFX ENTERTAINMENT, INC.
      By:   /s/  Michael Rapino       Michael Rapino        Chief Executive
Officer     

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