Exhibit 10.3
Execution Copy
July 29, 2008
Messrs.
L. Lowry Mays
Mark P. Mays, and
Randall T. Mays
200 East Basse Road
San Antonio, Texas 78209
          Re: Side Letter Agreement
Dear Lowry/Mark/Randall:
     This letter agreement relates to the Stockholders Agreement of even date
herewith by and among CC Media Holdings, Inc., BT Triple Crown Merger Co., Inc.,
Clear Channel Capital IV, LLC, Clear Channel Capital V, L.P., L. Lowry Mays,
Mark P. Mays, Randall T. Mays and the other parties thereto (the “ Stockholders
Agreement ”).
     The purpose of this letter agreement is to supplement the agreements of the
undersigned parties that are contained in the Stockholders Agreement.
Accordingly, the Company, Capital IV, Capital V, L. Lowry Mays, Mark P. Mays,
Randall T. Mays and the other undersigned Executive Stockholders hereby agree,
on behalf of themselves and their respective Permitted Transferees, heirs,
representatives, successors and permitted assigns, as follows:
     1. Whenever the term “Minimum Executive Holding Period” is used in the
Stockholders Agreement in relation to L. Lowry Mays, Mark P. Mays or Randall T.
Mays or any of their respective Permitted Transferees, that term will be deemed
to mean the period commencing on the Closing Date and ending on the date that is
the earlier of (a) the seventh anniversary of the Closing Date and (b) the third
anniversary of the closing of the Qualified Public Offering.
     2. Each of L. Lowry Mays, Mark P. Mays and Randall T. Mays will be treated
as a “Qualifying Holder” for purposes of the Stockholders Agreement with respect
to any period of time during which such Executive establishes to the reasonable
satisfaction of the Company that such Executive is an “affiliate” of the Company
(as that term is used in Rule 144), even if such Executive does not then hold
Shares that represent at least 1% of the then outstanding shares of Common Stock
and therefore would not otherwise then qualify as a “Qualifying Holder” for
purposes of the Stockholders Agreement.
     3. Section 7 of the Stockholders Agreement will not apply to L. Lowry Mays,
Mark P. Mays or Randall T. Mays or any of their respective Permitted
Transferees, including the respective undersigned Initial Executive Designee
associated with such Executive. Instead, the agreements set forth in Exhibit A
to this letter agreement, together with the capitalized terms used therein that
are defined or referred to in Exhibit B to this letter agreement, will apply to
each such Executive and each of such Executive’s Permitted Transferees as fully
as though such agreements were contained in the Stockholders Agreement as
Section 7 thereof and such capitalized terms were included with the terms
defined or referred to in Section 12.2 thereof. Unless otherwise specified,
references to Sections in this letter agreement or in either of the

 

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Exhibits hereto are references to sections of the Stockholders Agreement (which,
for purposes of this sentence, will be deemed to contain, in Section 7 thereof,
the agreements set forth in Exhibit A to this letter agreement and, in
Section 12.2 thereof, the capitalized terms used in such Exhibit or defined in
Exhibit B to this letter agreement).
     4. This letter agreement applies only to the undersigned parties hereto and
does not apply to, and is not to be construed as applying to, any other current
or any future stockholder of the Company (whether as an amendment or
modification of the Stockholders Agreement under Section 11.2 thereof, or
otherwise), except for the respective Permitted Transferees of the undersigned
Investors and Executive Stockholders that become party to the Stockholders
Agreement in accordance with its terms.
     5. Except to the extent supplemented by this letter agreement or
supplemented or otherwise modified by any subsequent written agreement of the
undersigned parties hereto, the terms of the Stockholders Agreement will apply
to each of the undersigned parties to this letter agreement as set forth
therein. Capitalized terms that are used in this letter agreement and/or in any
Exhibit to this letter agreement, but that are not defined in this letter
agreement or in either of those Exhibits, have the respective meanings given to
those terms in the Stockholders Agreement as in effect on the date hereof.
     6. This letter agreement may not be orally amended, modified, extended or
terminated, nor shall any purported oral waiver of any of its provisions be
effective. This letter agreement may be amended, modified, extended or
terminated, and the provisions hereof may be waived, but only by an agreement in
writing signed by the Company, a Requisite Capital IV Majority and each of the
undersigned Executives who would be affected thereby. No amendment,
modification, extension or termination of Section 7 of the Stockholders
Agreement, or any waiver of any of the provisions thereof, will apply to any of
the undersigned Executives, each of whose rights and obligations with respect to
the subject matters of that Section are contained entirely in this letter
agreement and the Exhibits hereto, each as amended, modified, extended,
terminated or waived from time to time in accordance with this paragraph.
     7. This letter agreement is being entered into concurrently with the
Stockholders Agreement and, like the Stockholders Agreement, will not become
effective until the consummation of the Merger. If the Stockholders Agreement is
terminated in accordance with its terms, this letter agreement will terminate
automatically. If any of the undersigned parties withdraws from the Stockholders
Agreement in accordance with its terms, that party will be deemed to have
simultaneously withdrawn from this letter agreement without the need for any
further action on part of that party or any of the other undersigned parties. No
termination (in whole or in part) of, or withdrawal from, this letter agreement
shall relieve any of the undersigned parties of liability for any breach by that
party prior to such termination or withdrawal.
     8. No provision in this letter agreement will give, or be construed to
give, any legal or equitable rights hereunder to any Person other than the
undersigned parties hereto and their respective heirs, representatives,
successors and permitted assigns.

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     9. Sections 12.1, 13.1, 13.2, 13.4, 13.5, 13.6, 14.1, 14.2 and 14.3 of the
Stockholders Agreement are hereby made part of this letter agreement as if each
of those sections of the Stockholders Agreement were set forth herein, mutatis
mutandis.

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     If you agree with us that this letter agreement correctly reflects the
terms of the agreements that the Company, Capital IV, Capital V, L. Lowry Mays,
Mark P. Mays, Randall T. Mays and the Initial Executive Designees intend to have
supplement their agreements in the Stockholders Agreement, then please kindly
acknowledge the same by signing in the space provided below.

            Sincerely,

CC MEDIA HOLDINGS, INC.

      By:   /s/ Scott M. Sperling         Name:   Scott M. Sperling       
Title:   President        CLEAR CHANNEL CAPITAL IV, LLC

      By:   /s/ Edward J. Han         Name:   Edward J. Han        Title:   Vice
President        CLEAR CHANNEL CAPITAL V, L.P.
      By:   CC Capital V Manager, LLC, its general partner
            By:   /s/ Edward J. Han         Name:   Edward J. Han       
Title:   Vice President     

[SIGNATURE PAGE TO LETTER AGREEMENT]

 

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MAYS EXECUTIVES

            L. LOWRY MAYS
      /s/ L. Lowry Mays                     MARK P. MAYS
      /s/ Mark P. Mays                     RANDALL T. MAYS
      /s/ Randall T. Mays                  

[SIGNATURE PAGE TO LETTER AGREEMENT]

 

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            LLM PARTNERS, LTD.
      By:   LL MAYS MANAGEMENT, LLC                     By:   /s/ L. Lowry Mays
        Name:   L. Lowry Mays        Title:   Authorized Person        MPM
PARTNERS, LTD.
      By:   MP MAYS MANAGEMENT, LLC                     By:   /s/ Mark P. Mays  
      Name:   Mark P. Mays        Title:   Authorized Person        RTM
PARTNERS, LTD.
      By:   RT MAYS MANAGEMENT, LLC                     By:   /s/ Randall T.
Mays         Name:   Randall T. Mays        Title:   Authorized Person     

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Exhibit A

7.   COMPANY CALL OPTION AND EXECUTIVE SALE RIGHTS.

     7.1. Call Option Upon Termination. Upon any termination of a Mays
Executive’s employment with the Company or any of its subsidiaries, the Company
will have the right to purchase Executive Shares held by such Mays Executive or
any of his Executive Designees or originally issued to such Mays Executive or
any of his Executive Designees but held by one or more Persons that acquired
such Shares as Permitted Transferees of such Mays Executive or any of such
Executive Designees (as to a given Mays Executive, such Mays Executive and all
such other Persons, collectively, such Mays Executive’s “Call Group”) to the
extent, and on the terms and conditions, specified in this Section 7.1 (each
such right, a “Call Option”).
     7.1.1. Termination Events; Resulting Call Rights.
     (a) Termination due to Death or Disability. If such termination is the
result of the death or Disability of such Mays Executive, then the Company will
have the right to purchase all or any portion of the New Option Shares held by
such Mays Executive’s Call Group at a per Share price equal to the Fair Market
Value thereof.
     (b) Termination by the Company other than for Cause or by a Mays Executive
for Good Reason. If such termination is the result of (i) a termination by the
Company or any of its subsidiaries other than for Cause (or Disability) or
(ii) a termination by such Mays Executive for Good Reason, then, in either such
event, the Company will have the right to purchase all or any portion of the New
Option Shares held by such Mays Executive’s Call Group at a per Share price
equal to the Fair Market Value thereof.
     (c) Termination for Cause. If such termination is the result of a
termination by the Company or any of its subsidiaries for Cause, then the
Company will have the right to purchase all or any portion of (i) the Vested
Restricted Shares, Purchased Shares and Rollover Option Shares held by such Mays
Executive’s Call Group, in each case at a per Share price equal to the
respective Fair Market Value thereof, and (ii) the New Option Shares held by
such Call Group at a per Share price equal to the lesser of the Fair Market
Value thereof and the Cost thereof.
     (d) Termination by a Mays Executive other than for Good Reason. If such
termination is the result of a termination by such Mays Executive other than for
Good Reason, then the Company will have the right to purchase all or any portion
of (i) the Purchased Shares and Rollover Option Shares held by such Mays
Executive’s Call Group, in each case at a per Share price equal to the
respective Fair Market Value thereof, and (ii) the New Option Shares held by
such Call Group at a per Share price equal to the lesser of the Fair Market
Value thereof and the Cost thereof.

 

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     (e) Retirement. If such termination is the result of Retirement by such
Mays Executive, then the Company will have the right to purchase all or any
portion of the New Option Shares held by such Mays Executive’s Call Group at a
per Share price equal to the Fair Market Value thereof.
     7.1.2. Notices. Any Call Option may be exercised by delivery of written
notice thereof (the “Call Notice”) to all members of the applicable Call Group
from whom the Company has elected to purchase Shares by no later than the Call
Notice Due Date. The Call Notice shall identify the Shares with respect to which
the Company has elected to exercise the Call Option and the purchase price
therefor (as calculated above under the applicable provision of Section 7.1.1).
For purposes of this Section 7, the “Call Notice Due Date” shall mean the date
that is six months after the effective date of the applicable termination of
employment; provided that, as to any Option Shares first acquired by the
applicable Mays Executive or any other member of such Mays Executive’s Call
Group on or after such date, the Call Notice Due Date shall be extended until
the date that is one month after the date such Option Shares were first acquired
by such Mays Executive or other member of such Call Group (such date of
acquisition, the “Option Exercise Date”); provided, further, that in the case of
a termination of employment of a type described in Section 7.1.1(b) or 7.1.1(e):
(i) a Call Option may not be exercised as to any Option Shares, until the date
that is six months and one day after the Option Exercise Date with respect to
such Option Shares; and (ii) the “Call Notice Due Date” shall mean the date that
is no later than the later of (x) the date that is six months after the
effective date of such termination of employment and (y) the date that is nine
months after the last Option Exercise Date (in the case of any such Option
Shares).
     7.1.3. Determination Date. The purchase price for any Shares to be
purchased pursuant to a Call Option shall be determined as of the date the
applicable Call Notice is delivered.
     7.1.4. No Modification of Vesting, Etc.. The rights of the Company and the
Investors to purchase Executive Shares under this Section 7.1 are in addition
to, and do not modify, any vesting provisions or other terms of any restricted
stock, stock option, subscription or other agreement or plan applicable to any
Executive Shares.
     7.1.5. Payments. Any payment required to be made by the Company or the
Investors to a Call Group under any provision of this Section 7.1 shall be made
in cash.
     7.1.6. Closing.
     (a) Except as otherwise agreed in writing by the Company and the Mays
Executive whose Call Group’s Executive Shares are the subject of a Call Notice,
the closing of any purchase and sale of Executive Shares pursuant to this
Section 7.1 shall take place at the principal executive office of the Company as
soon as reasonably practicable, and in any event not later than the date that is
the later of (i) 15 business days after the delivery of the applicable Call
Notice and (ii) five business days after all determinations of Fair Market Value
by a nationally-recognized investment bank that are required under clause (b) of
the

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definition of “Fair Market Value” (any such determination, an “Appraisal”) in
connection with such purchase and sale have become final; provided that such
closing may be extended at the election of a Requisite Capital IV Majority and
the Company solely to the extent necessary to obtain any applicable governmental
or regulatory approval. If the closing of any purchase and sale of Executive
Shares is extended by a Requisite Capital IV Majority pursuant to Section 7.1.7
or the preceding proviso clause, in either case for more than 30 days after the
delivery of the Call Notice for such Executive Shares, then the aggregate
purchase price therefor shall accrue interest from and after such 30th day at a
per annum interest rate equal to the prime rate as reported by JPMorgan Chase at
such time through the date payment is finally made, such rate of interest to
increase by 100 basis points on each three-month anniversary of such 30th day;
provided, however, that in no event will the per annum rate of interest in
effect under this Section 7.1.6(a) exceed 12%. In a case where an Appraisal is
conducted in connection with a purchase and sale of Executive Shares under this
Section 7.1, (A) interest shall begin to accrue under the preceding sentence
only if the closing of such purchase and sale has not occurred within 45 days
after the engagement of the investment bank conducting such Appraisal (in which
case all references in the preceding sentence to such “30th day” will be deemed
to be replaced with a reference to the 45th day after such engagement); and
(B) no interest shall be due if the Fair Market Value of such Executive Shares,
as determined by the investment bank conducting such Appraisal, is not more than
110% of the determination of the Fair Market Value of such Executive Shares by
the Board set forth in the Call Notice for such Executive Shares. In any event,
except as otherwise agreed in writing by the Company and the Mays Executive
whose Call Group’s Executive Shares are the subject thereof, the closing of any
purchase and sale of Executive Shares under this Section 7.1 that has been
extended or has otherwise been delayed for more than 30 days after the delivery
of the Call Notice for such Executive Shares shall take place as soon as
practicable (and in any event within five business days) after the circumstances
giving rise to such extension or delay no longer exist.
     (b) At the closing of any purchase and sale of Executive Shares pursuant to
this Section 7.1, the holders of Shares to be sold shall deliver to the Company
and/or the Investors and any applicable Investor Designees a certificate or
certificates representing the Shares to be purchased by the Company and/or the
Investors and any applicable Investor Designees duly endorsed, or with stock (or
equivalent) powers duly endorsed, for transfer with signature guaranteed, free
and clear of any Adverse Claim, with all necessary stock (or equivalent)
transfer tax stamps affixed, and the Company and/or the Investors and Investor
Designees shall pay to such holder by certified or bank check or wire transfer
of immediately available funds the purchase price of the Shares being purchased
by the Company and/or the Investors, less any taxes required to be withheld in
respect of such purchase and sale under applicable law. The receipt of
consideration by any Person selling Shares pursuant to this Section 7.1 shall be
deemed a representation and warranty by such Person that (a) such Person has
full right, title and interest in and to such Shares, (b) such Person has all
necessary power and authority and has taken all necessary action to sell such
Shares as

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contemplated and (c) such Shares are free and clear of any and all Adverse
Claims.
     7.1.7. Investor Call Option. If the Company elects not to purchase pursuant
to 7.1 all Executive Shares that are held by a Call Group, then the Company
shall notify each Investor and each Investor may purchase, or elect to have one
or more Investor Designees purchase, such Investor’s Ratable Share of the
remaining Shares for the same purchase price(s) and on the same terms and
conditions as the Company would be entitled to purchase such Shares under this
Section 7.1; provided, however, that, notwithstanding the provisions of
Section 7.1.6(a), if Investors or Investor Designees elect to take part in the
purchase of such remaining Shares, then a Requisite Capital IV Majority may
extend the closing date for up to 15 business days solely to the extent
necessary to obtain equity financing for such purchase. Without limiting the
generality of the foregoing sentence, any exercise of such right by one or more
Investors (or their Investor Designees) shall be made by notice to the
applicable Call Group within the applicable time period set forth in
Section 7.1.2. In addition, if the closing of any purchase and sale of Executive
Shares by the Company pursuant to Section 7.1 is extended in accordance with
Section 7.1.6(a) to obtain any applicable governmental or regulatory approval,
then the Company may assign to the Investors the right to purchase (which the
Investors may assign to their respective Investor Designees) their respective
Ratable Shares of the Executive Shares that are the subject of such purchase and
sale for the same purchase price (including interest, if applicable) and on the
same terms and conditions as the Company would be entitled to purchase such
Shares under this Section 7.1. If any Investor agrees to forego its full Ratable
Share of any Shares that it is entitled to purchase under this Section 7.1.7,
the remainder shall be made available to the other Investors in proportion to
their respective Ratable Shares (unless the Investors otherwise agree). The
Company or any Investor or Investor Designee purchasing Executive Shares
pursuant to this Section 7.1.7 may, at any time following the purchase and sale
thereof, require that the Executive Shares being purchased by such Investor or
Investor Designee be converted by the Company into shares of Class C Stock in
accordance with the Company’s certificate of incorporation.
     7.2. Certain Public Sale Rights. Upon any termination of a Mays Executive’s
employment with the Company or any its subsidiaries, such Mays Executive, each
of his Executive Designees and each Person holding Executive Shares who acquired
them as a Permitted Transferee of such Mays Executive or any of such Executive
Designees (as to a given Mays Executive, such Mays Executive and all such other
Persons, collectively, such Mays Executive’s “Sale Group”) will have the right,
subject to Section 7.2.2 and Sections 3.3, 3.5, 3.6 and 3.7, to sell shares of
Common Stock to the public pursuant to Rule 144, to the extent, and on the terms
and conditions, specified in this Section 7.2 (any such sale, a “Permitted
Public Transfer”), notwithstanding that such a Transfer might not otherwise then
be permitted by Section 3.1.4. Executive Shares sold in Permitted Public
Transfers pursuant to this Section 7.2 shall conclusively be deemed thereafter
not to be Shares under this Agreement.
     7.2.1. Termination Events; Resulting Public Sale Rights.

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     (a) Termination due to Death or Disability. If such termination is the
result of the death or Disability of such Mays Executive, then, subject to
Section 7.2.2, at any time during the respective Permitted Sale Period
applicable to such Executive Shares, each member of such Mays Executive’s Sale
Group will have the right to sell in one or more Permitted Public Transfers all
or any portion of the Vested Restricted Shares, Purchased Shares, Rollover
Option Shares and New Option Shares held by such member (other than any New
Option Shares that are then subject to a valid Call Notice under Section 7.1.2).
     (b) Termination by Company other than for Cause or Termination by Mays
Executive for Good Reason. If such termination is the result of (i) a
termination by the Company or any of its subsidiaries other than for Cause or
(ii) a termination by such Mays Executive for Good Reason, then, in either such
event, subject to Section 7.2.2, at any time during the respective Permitted
Sale Period applicable to such Executive Shares, each member of such Mays
Executive’s Sale Group will have the right to sell in one or more Permitted
Public Transfers all or any portion of the Vested Restricted Shares, Purchased
Shares and Rollover Option Shares held by such member.
     (c) Retirement. If such termination is the result of the Retirement of such
Mays Executive, then, subject to Section 7.2.2, at any time during the Permitted
Sale Period applicable to such Executive Shares, each member of such Mays
Executive’s Sale Group will have the right to sell in one or more Permitted
Public Transfers all or any portion of the Vested Restricted Shares held by such
member.
     7.2.2. Rights of First Offer. If a member of a Sale Group proposes to make
a Permitted Public Transfer of any shares of Common Stock in accordance with
Section 7.2.1, then, prior to making such Permitted Public Transfer, such member
(the “Transferring Executive Stockholder”) must comply with this Section 7.2.2.
     (a) Notice. The Transferring Executive Stockholder shall notify the Company
and each of the Investors of such Transferring Executive Stockholder’s intention
to make a Permitted Public Transfer (the “ROFO Notice”). The ROFO Notice shall
identify the number of Shares that are the subject of the proposed Permitted
Public Transfer (the “ROFO Shares”) and shall constitute an irrevocable offer to
Transfer the ROFO Shares to the Company and the Investors and their respective
Investor Designees, on the basis described in this Section 7.2.2, for the per
Share purchase price set forth in the ROFO Notice (the “ROFO Price”).
     (b) Company Option. The Company will have the right to purchase all or any
portion of the ROFO Shares by giving written notice (the “Company Acceptance
Notice”) to the Transferring Executive Stockholder and the Investors as to the
number of ROFO Shares that the Company is willing to purchase by no later than
the date that is five business days after the date the ROFO Notice is effective
(the “Company ROFO Period”).

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     (c) Investor Option. If the Company does not elect to purchase all of the
ROFO Shares by the end of the Company ROFO Period, the Transferring Executive
Stockholder shall provide the Investors with an additional notice (the “Second
ROFO Notice”) on the last day of the Company ROFO Period that identifies the
ROFO Shares that the Company has declined to purchase (the “Remaining ROFO
Shares”). Each Investor will have the right to purchase, or to cause one or more
of its Investor Designees to purchase, up to such Investor’s Ratable Share of
the Remaining Shares by giving written notice (an “Investor Acceptance Notice”)
to the Transferring Executive Stockholder and the other Investors as to the
number of Remaining ROFO Shares that such Investor and/or its Investor Designees
are willing to purchase by no later than the date that is two business days
after the date the Second ROFO Notice is effective (the “Extended ROFO Period”);
provided that if any Investor declines to purchase (and does not designate any
Persons to purchase as such Investor’s Investor Designees) such Investor’s
Ratable Share of the Remaining ROFO Shares, the Remaining ROFO Shares that such
Investor has declined to purchase shall be made available to the each of the
other Investors and their respective Investor Designees that have delivered an
Investor Acceptance Notice pro rata to such Investors’ respective Ratable Shares
unless any such other Investor has specified in its Investor Acceptance Notice
an unwillingness to participate in such a reallocation. The Company or any
Investor or Investor Designee purchasing Remaining ROFO Shares pursuant to this
Section 7.2.2 may, at any time following the purchase and sale thereof, require
that such Remaining ROFO Shares be converted by the Company into shares of
Class C Stock in accordance with the Company’s certificate of incorporation.
     (d) Closing.
     (i) Except as otherwise agreed in writing by the Transferring Executive
Stockholder, the Company and a Requisite Capital IV Majority, the closing of any
purchase and sale of ROFO Shares by the Company and/or the Investors or their
Investor Designees pursuant to this Section 7.2 shall take place at the
principal office of the Company as soon as reasonably practicable and in no
event later than 15 business days after the delivery of the applicable ROFO
Notice; provided that if any Investors or their Investor Designees are
participating in such purchase and sale, such closing may be extended solely to
the extent necessary to obtain equity financing for such purchase for an
additional 15 business days by a Requisite Capital IV Majority; provided,
further, that, in any case, such closing may be extended at the election of a
Requisite Capital IV Majority and the Company solely to the extent necessary to
obtain any applicable governmental or regulatory approval. If the closing of any
purchase and sale of ROFO Shares is extended by a Requisite Capital IV Majority
pursuant to either or both of the two preceding proviso clauses for more than
30 days after the delivery of the applicable ROFO Notice, then the aggregate
purchase price therefor shall accrue interest from and after such 30th day at a
per annum interest rate equal to the prime rate as reported by

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JPMorgan Chase at such time through the date payment is finally made, such rate
of interest to increase by 100 basis points on each three-month anniversary of
such 30th day; provided, however, that in no event will the per annum rate of
interest in effect under this Section 7.2.2(d) exceed 12%. In any event, except
as otherwise agreed in writing by the Transferring Executive Stockholder, the
Company and a Requisite Capital IV Majority, the closing of any purchase and
sale of ROFO Shares under this Section 7.2.2 that has been extended or has
otherwise been delayed for more than 30 days after the delivery of the ROFO
Notice under this Section 7.2.2 for such purchase and sale shall take place as
soon as practicable (and in any event within five business days) after the
circumstances giving rise to such extension or delay no longer exist.
     (ii) At such closing, the Transferring Executive Stockholder shall deliver
to the Company and/or the Investors and any applicable Investor Designees a
certificate or certificates representing the ROFO Shares to be purchased by the
Company and/or the Investors and any applicable Investor Designees duly
endorsed, or with stock powers duly endorsed, for transfer with signature
guaranteed, free and clear of any Adverse Claim, with any necessary stock
transfer tax stamps affixed, and the Company and/or the Investors and any
Investor Designees shall pay to the Transferring Executive Stockholder the
purchase price for the respective ROFO Shares that the Company and/or the
Investors and any Investor Designees are purchasing by certified or bank check
or wire transfer of immediately available funds, less any taxes required to be
withheld in respect of the purchase and sale of any of such ROFO Shares under
applicable law. The receipt of consideration for any ROFO Shares being sold
pursuant to this Section 7.2 shall be deemed a representation and warranty by
the Transferring Executive Stockholder that (a) the Transferring Executive
Stockholder has full right, title and interest in and to such ROFO Shares,
(b) the Transferring Executive Stockholder has all necessary power and authority
and has taken all necessary action to sell such ROFO Shares as contemplated and
(c) such ROFO Shares are free and clear of any and all Adverse Claims.
     (e) Permitted Public Sale. If the Company, the Investors and the Investor
Designees do not purchase all of the ROFO Shares in accordance with this
Section 7.2.2, then the Transferring Executive Stockholder may proceed with a
Permitted Public Transfer with respect to the remaining balance of the ROFO
Shares until the end of the respective Permitted Sale Period, but shall not
Transfer any other shares of Common Stock in a Permitted Public Transfer without
first complying with this Section 7.2.2. In addition, except as otherwise agreed
by the Transferring Executive Stockholder, the Company and a Requisite Capital
IV Majority, if, at any time during such Permitted Sale Period, the Transferring
Executive Stockholder desires to make a Permitted Public Transfer of any such
ROFO Shares for a per Share price that is less than 95% of the ROFO Price, then
such Transferring Executive Stockholder must once again comply with the

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provisions of this Section 7.2.2 before doing so; provided, however, that each
applicable period for giving notice to which reference is made in
Section 7.2.2(b) and 7.2.2(c) will be one business day or such longer period as
the Transferring Executive Stockholder, the Company and a Requisite Capital IV
Majority may agree.
7.3. Put Option.
     7.3.1. Restricted Shares. Until the end of a Permitted Sale Period
following the termination of the employment of any Mays Executive with the
Company or any of its subsidiaries during which such Mays Executive and the
other members of his Sale Group are permitted to sell Vested Restricted Shares
in Permitted Public Transfers in accordance with Section 7.2 such Mays Executive
will have the right to require the Company to purchase all or any portion of
such Vested Restricted Shares at a per Share price equal to the Fair Market
Value thereof (such right, the “Restricted Stock Put Option”), determined as of
the Closing (in the case of a termination of employment of a type described in
Section 7.2.1(a) or 7.2.1(b)) or as of the date the Put Notice related thereto
is delivered (in the case of a termination of employment of a type described in
Section 7.2.1(c)).
     7.3.2. Other Shares. If, following any termination of the employment of any
Mays Executive with the Company or any of its subsidiaries that is of a type
described in Section 7.2.1(a) or 7.2.1(b), such Mays Executive and the other
members of such Mays Executive’s Sale Group comply with the requirements of
Section 7.2 and use commercially reasonable good faith efforts to sell in
Permitted Public Transfers the Purchased Shares, Rollover Option Shares and, in
the case of a termination of employment of a type described in Section 7.2.1(a),
New Option Shares they are permitted to sell under Section 7.2, but are unable
to sell all such Executive Shares by the end of the Permitted Sale Period
applicable thereto, then, subject to the terms and conditions of this
Section 7.3, such Mays Executive will have the right to require the Company to
purchase under this Section 7.3.2 all or any portion of such Executive Shares
that have not been sold (any such Executive Shares, “Other Put Eligible
Shares”), in each case at a per Share price equal to the respective Fair Market
Value thereof (such right, the “Other Stock Put Option”; the Restricted Stock
Put Option and the Other Stock Put Option, each a “Put Option”), determined as
of the date on which the Put Notice applicable thereto is delivered.
     7.3.3. Exercise; Notice. Subject to the terms and conditions of this
Section 7.3, (a) a Mays Executive may exercise the Restricted Stock Put Option
with respect to all or any portion of the Vested Restricted Shares held by such
Mays Executive and the other members of his Sale Group on a single occasion by
delivery of written notice (a “Put Notice”) on any date during the respective
Permitted Sale Period applicable such Vested Restricted Shares; and (b) a Mays
Executive may exercise the Other Stock Put Option with respect to all or any
portion of the Other Put Eligible Shares held by such Mays Executive and the
other members of his Sale Group by delivery of written notice (a “Put Notice”)
on the first business day after the last day of the respective Permitted Sale
Period applicable to such Other Put Eligible Shares.

A-8

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     7.3.4. Determination Date; Payment. The purchase price for any Executive
Shares that are the subject of a valid Put Notice (any such Executive Shares,
“Put Shares”) shall be determined as of the applicable date specified in
Section 7.3.1 (in the case of the Restricted Stock Put Option) or in
Section 7.3.2 (in the case of the Other Stock Put Option). The Company shall
deliver the applicable Mays Executive a written notice setting forth such
purchase price within five business days following the receipt of any applicable
Put Notice. Any payment required to be made by the Company or the Investors or
any Investor Designees to the applicable Call Group under any provision of this
Section 7.3 shall be made in cash.
     7.3.5. Restricted Payments.
     (a) If (i) any payment of cash by the Company otherwise required by this
Section 7.3 or any distribution to the Company from any of its subsidiaries of
cash in the amount of any payment otherwise required to be made by the Company
under this Section 7.3 would result in, or give rise to, a breach or violation
of, or any default or right or cause of action under, any agreement of the
Company or any of its subsidiaries that relates to indebtedness, or (ii) the
Board determines in good faith that the authorization or making of any such
payment or distribution (A) would be detrimental to the Company and its
subsidiaries given their financial condition and liquidity requirements at such
time or (B) would constitute a violation of law or of the Board’s fiduciary
duties, then, in either case (i) or (ii), the Company will have the right to
postpone the making of such payment until such time as it may do so, or may
cause a distribution from any of its subsidiaries to do so, without giving rise
to any of the circumstances described in clause (i) or (ii). Without duplication
of any interest chargeable under Section 7.3.6, any payments that are required
to be postponed under this Section 7.3.5, if postponed for more than a 30-day
period, shall accrue interest from and after the end of such 30-day period at a
per annum rate equal to the prime rate as reported by JPMorgan Chase at such
time through the date payment is finally made, such rate of interest to increase
by 100 basis points on each three-month anniversary of the end of such 30-day
period; provided, however, that in no event will the per annum rate of interest
in effect under this Section 7.3.5 exceed 12%. The Company shall pay any amount
required under Section 7.3 (together with interest accrued thereon, as
calculated in accordance with this Section 7.3.5) that is postponed in
accordance with this Section 7.3.5 as soon as practicable (and in any event
within five business days) after the Company can do so without giving rise to
any of the circumstances described in clause (i) or (ii) of this Section 7.3.5.
     (b) The Company agrees to use good faith efforts to resist any amendment
proposed by its current or future lenders to the terms of the senior credit
facility of the Company and its subsidiaries that by its express terms would
prevent the Company from satisfying its obligations under any valid Put Option
without availing itself of the provisions of Section 7.3.5(a); provided,
however, that nothing in this Section 7.3.5(b) will prevent the Company from
agreeing to such an amendment if it believes that doing so is in the best
interests of the Company.

A-9

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     7.3.6. Closing.
     (a) Except as otherwise agreed in writing by the Company, a Requisite
Capital IV Majority and the Mays Executive exercising the applicable Put Option,
the closing of any purchase and sale of Put Shares pursuant to the exercise of
any Put Option pursuant to this Section 7.3 shall take place at the principal
office of the Company as soon as reasonably practicable and in no event later
than the date that is the later of (i) 15 business days after the delivery of
the Put Notice applicable to such Put Option and (ii) five business days after
all Appraisals, if any, conducted in connection with such Put Option have become
final; provided that such closing may be extended at the election of a Requisite
Capital IV Majority and the Company solely to the extent necessary to obtain any
applicable governmental or regulatory approval. If the closing of any purchase
and sale of Put Shares is extended by a Requisite Capital IV Majority pursuant
to Section 7.3.7 or the preceding proviso clause, in either case for more than
30 days after the delivery of the applicable Put Notice, then the purchase price
therefor shall accrue from and after the 30th day at a per annum interest rate
equal to the prime rate as reported by JPMorgan Chase at such time through the
date payment is finally made, such rate of interest to increase by 100 basis
points on each three-month anniversary of such 30th day; provided, however, that
in no event will the per annum rate of interest in effect under this
Section 7.3.6 exceed 12%. In a case where an Appraisal is conducted in
connection with a purchase and sale of Put Shares under this Section 7.3,
(A) interest shall begin to accrue under the preceding sentence only if the
closing of such purchase and sale has not occurred within 45 days after the
engagement of the investment bank conducting such Appraisal (in which case all
references in the preceding sentence to such “30th day” will be deemed to be
replaced with a reference to the 45th day after such engagement); and (B) no
interest shall be due if the Fair Market Value of such Put Shares, as determined
by the investment bank conducting such Appraisal, is not more than 110% of the
determination of the Fair Market Value of such Put Shares by the Board set forth
in the Put Notice applicable to such Put Shares. In any event, except as
otherwise agreed in writing by the Company, a Requisite Capital IV Majority and
the Mays Executive exercising the applicable Put Option, the closing of any
purchase and sale of Put Shares under this Section 7.3 that has been extended or
has otherwise been delayed for more than 30 days under this Section 7.3 after
the delivery of the Put Notice for such Put Shares shall take place as soon as
practicable (and in any event within five business days) after the circumstances
giving rise to such extension or delay no longer exist.
     (b) At the closing of any purchase and sale of Put Shares following the
exercise of any Put Option, each member of the Sale Group selling Put Shares
shall deliver to the Company and/or the Investors and any applicable Investor
Designees a certificate or certificates representing the Shares to be purchased
by the Company and/or the Investors or any applicable Investor Designees duly
endorsed, or with stock powers duly endorsed, for transfer with signature
guaranteed, free and clear of any Adverse Claim, with any necessary stock
transfer tax stamps affixed, and the Company and/or the Investors and Investor

A-10

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Designees shall pay to such member the purchase price for such Put Shares by
certified or bank check or wire transfer of immediately available funds, less
any taxes or other amounts required to be withheld under applicable law. The
receipt of consideration for any Shares being sold pursuant to any Put Option
shall be deemed a representation and warranty by the Person receiving such
consideration that (a) such Person has full right, title and interest in and to
such Shares, (b) such Person has all necessary power and authority and has taken
all necessary action to sell such Shares as contemplated and (c) such Shares are
free and clear of any and all Adverse Claims.
     7.3.7. Assignment. The Company may at any time assign its obligation, in
whole or in part, to purchase any Put Shares that are subject to a valid Put
Option to any Investors that agree in writing to accept the same. If one or more
Investors agree in writing to accept such obligation, in whole or in part, then
each of those Investors may elect to purchase (or elect to have an Investor
Designee purchase) up to such Investor’s Ratable Share of the Put Shares in
question for the same purchase price(s) (including any interest thereon, if
applicable) and on the same terms and conditions as the Company would be
required to purchase such Put Shares under this Section 7.3; provided, however,
that, notwithstanding the provisions of Section 7.3.6(a), if Investors or
Investor Designees take part in a purchase and sale of Put Shares, then a
Requisite Capital IV Majority may extend the closing date for up to 15 business
days solely to the extent necessary to obtain equity financing for such
purchase; provided, further, however, that Investors and Investor Designees
taking part in any such purchase and sale of Put Shares may not avail themselves
of the provisions of Section 7.3.5 to postpone the payment of such purchase
price(s) (or interest thereon, if applicable), it being understood that if any
such Investor or Investor Designee assigns the obligation to purchase any such
Put Shares back to the Company (which the Company will be obligated to accept
without condition), the provisions of Section 7.3.5 will be available to the
Company and applicable to the purchase and sale of such Put Shares. The Company
or any Investor or Investor Designee purchasing Put Shares pursuant to this
Section 7.3.7 may require, at any time following the purchase and sale thereof,
that such Put Shares be converted by the Company into shares of Class C Stock in
accordance with the Company’s certificate of incorporation.
     7.4. Acknowledgment. Each Mays Executive and each of his Executive
Designees acknowledges and agrees that none of the Company, any Investor, any
Investor Designee or any Person that is directly or indirectly affiliated with
the Company, any Investor, any Investor Designee and exercises any rights, or
performs any obligations, under any of Sections 7.1, 7.2 or 7.3 (in each case
including as a director, officer, manager, employee, agent or otherwise) has any
duty or obligation to disclose to any of such Executive’s Call Group or Sale
Group, and no member of any such Call Group or Sale Group shall have any right
to be advised of, any material information regarding the Company or any of its
subsidiaries or otherwise at any time prior to, upon, or in connection with any
termination of an Mays Executive’s employment with the Company or any of its
subsidiaries or upon the exercise of any Call Option, Put Option or other right
to purchase Shares under this Section 7 or otherwise in connection with any
purchase of Shares in accordance with the terms of any of Sections 7.1, 7.2 or
7.3.

A-11

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     7.5. Period. The provisions of Sections 7.1, 7.2 and 7.3 shall terminate
upon the earlier of (a) the occurrence of a Change of Control and (b) the
closing of the Qualified Public Offering.

A-12

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Exhibit B
Definitions
     “Appraisal” has the meaning set forth in Section 7.16.
     “Call Group” has the meaning set forth in Section 7.1.
     “Call Notice” has the meaning set forth in Section 7.1.2.
     “Call Notice Due Date” has the meaning set forth in Section 7.1.2.
     “Call Option” has the meaning set forth in Section 7.1.
     “Cause” when used in relation to a Mays Executive, has the meaning given to
such term in the respective Employment Agreement to which such Mays Executive is
a party.
     “Company Acceptance Notice” has the meaning set forth in Section 7.2.2.
     “Company ROFO Period” has the meaning set forth in Section 7.2.2.
     “Comparable Company” means, in relation to the Company during any given
period of time following the termination of employment of a Mays Executive, any
corporation that during such time has Publicly-Traded Shares and an amount of
Publicly-Held Shares that have an aggregate value that is not less than 90%, or
greater than 110%, of the aggregate value of the Company’s Publicly-Held Shares
during such time and that the Board and such Mays Executive mutually agree is
otherwise comparable to the Company.
     “Cost” means, with respect to any Executive Share, the purchase price paid
for such Executive Share by the original holder thereof, less any distributions
received with respect to such Executive Share.
     “Extended ROFO Period” has the meaning set forth in Section 7.2.2.
     “Fair Market Value” will be determined with respect to any Share as of any
given date under clause (a) or (b) below, whichever is applicable to such Share
under the circumstances, except that in all cases for purposes of this Agreement
the “Fair Market Value” of a Restricted Share as of the Closing Date will be
deemed to equal $36.00 (subject to appropriate adjustment as determined by the
Company for any stock split, reverse stock split or similar transaction
affecting the Class A Stock that occurs after the Closing Date):
     (a) if, on such date, the Company has Publicly-Traded Shares and the
average weekly reported volume of trading in the Company’s Publicly-Traded
Shares during the calendar weeks falling in the 30 calendar days preceding such
date is at least equal to 50% of the median of the average weekly reported
volumes of trading in the Publicly-Traded Shares of Comparable Companies during
those same calendar weeks, then the “Fair Market Value” of such Share will be
the average closing trading-price of the Company’s Publicly-Traded Shares during
all of the trading days in that 30 calendar-day period; or

 

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     (b) if the foregoing clause (a) is not applicable, then the “Fair Market
Value” of such Share as of such date will be as determined by the Board in good
faith; provided that if, not later than ten business days after being delivered
notice of any such determination pursuant to Section 7.1 or 7.3, as applicable,
the Mays Executive whose Call Group or Sale Group, as the case may be, has
Executive Shares subject to such determination delivers written notice to the
Board of his objection to such determination, then the “Fair Market Value” of
such Share will be as determined by a nationally-recognized investment bank that
is mutually acceptable to the Board and the applicable Mays Executive (which
bank shall be selected by no later than ten business days after the applicable
Mays Executive delivers such objection to the Board), whose determination will
be binding on the Company and such Mays Executive and all members of his Call
Group or Sale Group, as applicable, and whose fees and expenses shall be paid
for by the Company.
     “Good Reason” when used in relation to a Mays Executive, has the meaning
given to such term in the respective Employment Agreement to which such Mays
Executive is a party.
     “Investor Acceptance Notice” has the meaning set forth in Section 7.2.2.
     “Investor Designee” means, in relation to any Investor, any Person
designated by such Investor to purchase Executive Shares under Section 7.1, 7.2
or 7.3.
     “Mays Executive” means each of L. Lowry Mays, Mark P. Mays and Randall T.
Mays.
     “New Options” means, as to any Mays Executive or his Permitted Transferees,
Options that are Shares but are not Rollover Options.
     “New Option Shares” means Shares acquired upon exercise of a New Option.
     “Option Exercise Date” has the meaning set forth in Section 7.1.2.
     “Option Shares” means Shares acquired upon exercise of an Option that is a
Share.
     “Other Put Eligible Shares” has the meaning set forth in Section 7.3.2.
     “Other Stock Put Option” has the meaning set forth in Section 7.3.2.
     “Permitted Public Transfer” has the meaning set forth in Section 7.2.
     “Permitted Sale Period” means (a) with respect to any Restricted Shares
held by a member of a Mays Executive’s Sale Group, the period commencing on the
effective date of the Mays Executive’s termination of employment with the
Company or any of its subsidiaries and ending on the earlier of (i) the 90th day
thereafter or (ii) March 1st of the year following the calendar year in which
the Mays Executive’s termination of employment occurs; or (b) with respect to
any other Executive Shares held by a member of a Mays Executive’s Sale Group,
the period commencing on the effective date of the Mays Executive’s termination
of employment with the Company or any of its subsidiaries and ending on the
six-month anniversary thereof.

B-2

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     “Publicly-Held Shares” means, as of any given time, with respect to any
class of common stock of a corporation that is registered under Section 12 of
the Exchange Act, the total number of issued and outstanding shares of such
class, as set forth in the most recent report filed by such corporation under
the Securities Act or the Exchange Act (excluding, for purposes of this
definition, all of the issued and outstanding shares of such class, if any, that
are beneficially owned by any Person (or group of Persons reporting as a group
under the Exchange Act) that beneficially owns 25% or more of such total number
of reported issued and outstanding shares).
     “Publicly-Traded Shares” means, in relation to any corporation as of any
given time, shares of such corporation’s common stock that are then issued and
outstanding and belong to a class of common stock that is (a) registered under
Section 12 of the Exchange Act and (b) listed on a national securities exchange,
authorized for quotation in the automated quotations system of national
securities association or traded over-the-counter.
     “Purchased Shares” means, as to any Mays Executive or Executive Designee or
any of their respective Permitted Transferees: (a) all Shares originally
purchased by or issued to such Mays Executive or Executive Designee (i) pursuant
to the Subscription Agreement to which such Mays Executive or Executive Designee
is party, (ii) in connection with the Closing in substitution of shares of
restricted stock of Clear Channel granted to such Mays Executive on or about
May 22, 2007 or (iii) pursuant to Section 5; and (b) all other Executive Shares
designated as “Purchased Shares” by a Requisite Capital IV Majority.
     “Put Notice” has the meaning set forth in Section 7.3.3.
     “Put Option” has the meaning set forth in Section 7.3.
     “Put Shares” has the meaning set forth in Section 7.3.4.
     “Ratable Share” means:
     (a) as to any Investor, with respect to any Executive Shares that the
Investors have a right to purchase under Section 7.1.7, a number of such
Executive Shares equal to the product of (i) the aggregate number of such
Executive Shares multiplied by (ii) a fraction, the numerator of which is the
number of Shares held by that Investor as of the date the Investors are notified
of or otherwise acquire their right to purchase such Executive Shares, and the
denominator of which is the aggregate number of Shares held by all Investors as
of that date;
     (b) as to any Investor, with respect to any Remaining ROFO Shares that the
Investors have a right to purchase under Section 7.2.2, a number of such
Remaining ROFO Shares equal to the product of (i) the aggregate number of such
Remaining ROFO Shares multiplied by (ii) a fraction, the numerator of which is
the number of Shares held by that Investor as of the date of the applicable
Second ROFO Notice, and the denominator of which is the aggregate number of
Shares held by all Investors as of that date; or
     (c) as to any Investor, with respect to any Put Shares that the Investors
are notified of their opportunity to purchase under Section 7.3.7, a number of
such Put

B-3

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Shares equal to the product of (i) the aggregate number of such Put Shares
multiplied by (ii) a fraction, the numerator of which is the number of Shares
held by that Investor as of the date the Investors are notified of their
opportunity to purchase such Put Shares, and the denominator of which is the
aggregate number of Shares held by all Investors as of that date.
     “Remaining ROFO Shares” has the meaning set forth in Section 7.2.2.
     “Restricted Shares” means, as to Mark P. Mays or any of his Permitted
Transferees or Randall T. Mays or any of his Permitted Transferees, as the case
may be, the respective Shares originally granted to such Mays Executive pursuant
to the terms of the respective Restricted Stock Agreement dated as of the
Closing Date between the Company and such Mays Executive.
     “Restricted Stock Put Option” has the meaning set forth in Section 7.3.1.
     “Retirement” means, with respect to any Mays Executive, such Mays
Executive’s retirement from service with the Company and its subsidiaries
(a) after attaining 62 years of age or (b) after attaining 60 years of age and
completing 36 months of service after the Closing.
     “ROFO Notice” has the meaning set forth in Section 7.2.2.
     “ROFO Price” has the meaning set forth in Section 7.2.2.
     “ROFO Shares” has the meaning set forth in Section 7.2.2.
     “Rollover Options” means, as to any Mays Executive or any Permitted
Transferee of any such Mays Executive, Options governed by the terms of the
respective Rollover Option Agreement dated as of the Closing Date between the
Company and such Mays Executive.
     “Rollover Option Shares” means Shares acquired upon exercise of a Rollover
Option.
     “Sale Group” has the meaning set forth in Section 7.2.
     “Second ROFO Period” has the meaning set forth in Section 7.2.2.
     “Transferring Executive Stockholder” has the meaning set forth in
Section 7.2.2.
     “Unvested Restricted Shares” means, as of any given time, Restricted Shares
that are not then Vested Executive Shares.
     “Vested Restricted Shares” means, as of any given time, Restricted Shares
that are then Vested Executive Shares.

B-4