Exhibit 10.4
TAX MATTERS AGREEMENT
BY AND BETWEEN
CLEAR CHANNEL COMMUNICATIONS, INC.
AND
CLEAR CHANNEL OUTDOOR HOLDINGS, INC.
Dated as of November 10, 2005

 

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TABLE OF CONTENTS

                                      Page  
 
                    Section 1.   Definitions     1   Section 2.   Tax Payments  
  4  
 
    (a )   Estimated Income Tax Payments     4  
 
    (b )   Separate Income Tax Liability     5  
 
    (c )   Additional Calculations     6  
 
    (d )   Timing     6  
 
    (e )   Adjustments     7  
 
    (f )   Other Adjustments and Indemnification     7  
 
    (g )   Reimbursements     7   Section 3.   Income Tax Return Preparation    
8   Section 4.   Audits     8   Section 5.   Cooperation     8  
 
    (a )   Tax Information     8  
 
    (b )   Other Cooperation     9  
 
    (c )   Agent     9   Section 6.   Retention of Records     9   Section 7.  
Resolution of Disputes     10   Section 8.   Spin-Off of CCO     10  
 
    (a )   Indemnities for Distribution Taxes     10  
 
    (b )   Covenants of CCO     11  
 
    (c )   Cooperation with Letter Ruling and Tax Opinion     11   Section 9.  
Miscellaneous     12  
 
    (a )   Taxable Periods Prior to IPO     12  
 
    (b )   Term of the Agreement     12  
 
    (c )   Injunctions     12  
 
    (d )   Severability     12  
 
    (e )   Assignment     12  
 
    (f )   Further Assurances     12  
 
    (g )   Parties in Interest     13  
 
    (h )   Waivers, Etc     13  

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TABLE OF CONTENTS
(continued)

                                      Page  
 
                   
 
    (i )   Setoff     13  
 
    (j )   Change of Law     13  
 
    (k )   Confidentiality     13  
 
    (l )   Headings     13  
 
    (m )   Counterparts     13  
 
    (n )   Notices     14  
 
    (o )   Costs and Expenses     14  
 
    (p )   Applicable Law     14  

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TAX MATTERS AGREEMENT
     This Tax Matters Agreement (this “Agreement”), dated as of November 10,
2005, is entered into by and between Clear Channel Communications, Inc., a Texas
corporation (“Parent”), and Clear Channel Outdoor Holdings, Inc., a Delaware
corporation (“CCO”).
RECITALS
     WHEREAS, certain Parent Group Members (as defined below), on the one hand,
and certain CCO Group Members (as defined below), on the other hand, file Income
Tax Returns (as defined below) on a consolidated, combined and/or unitary basis
for certain Domestic Tax (as defined below) purposes;
     WHEREAS, for Domestic Tax purposes, Parent prepares and files, or causes to
be prepared and filed, the Income Tax Returns of each CCO Group Member, whether
or not such CCO Group Member files an Income Tax Return on a consolidated,
combined or unitary basis with any Parent Group Member;
     WHEREAS, CCO intends to undertake an initial public offering (the “IPO”);
     WHEREAS, following the IPO and for Domestic Tax purposes, Parent and CCO
intend (i) for certain CCO Group Members to continue to file Income Tax Returns
on a consolidated, combined and/or unitary basis with certain Parent Group
Members and (ii) for Parent to continue to prepare and file, or to cause to be
prepared and filed, all Income Tax Returns of each CCO Group Member, whether or
not such CCO Group Member files an Income Tax Return on a consolidated, combined
or unitary basis with any Parent Group Member; and
     WHEREAS, in contemplation of the IPO, Parent and CCO desire to agree upon
the method of determining the financial consequences to each party resulting
from the preparation and filing of such Income Tax Returns;
AGREEMENT
     NOW, THEREFORE, in consideration of the premises set forth above and the
terms and conditions set forth below, the parties hereto agree as follows:
     Section 1. Definitions. For purposes of this Agreement, the following
capitalized terms shall have the meanings set forth below:
     “Adjustment” shall mean any proposed or final change in the Tax liability
of any Person.
     “Affiliated Group” shall mean an affiliated group of corporations within
the meaning of section 1504(a) of the Code.

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     “Affiliate” shall mean any Person that directly or indirectly is
“controlled” by the other Person in question. “Control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of an Entity, whether through ownership of voting
securities, by contract or otherwise. Except as otherwise provided herein, the
term Affiliate for purposes of Section 8 shall refer to Affiliates of a Person
as determined immediately after the Distribution.
     “CCO Group” shall mean CCO and its Subsidiaries.
     “CCO Group Member” shall mean each member of the CCO Group.
     “Code” shall mean the Internal Revenue Code of 1986, as amended.
     “Deconsolidation Event” shall mean, with respect to each CCO Group Member,
any event or transaction, including the Distribution, that causes such CCO Group
Member to no longer be eligible to join any Parent Group Member in filing an
applicable Income Tax Return on a consolidated, combined or unitary basis.
     “Distribution” shall mean the distribution to Parent stockholders of all of
the outstanding stock of CCO owned by Parent pursuant to transactions intended
to qualify as a tax-free distribution under section 355 of the Code.
     “Distribution Date” shall mean the date the Distribution becomes effective.
     “Distribution Taxes” shall mean any Taxes imposed on any Parent Group
Member resulting from, or arising in connection with the failure of the
Distribution to be tax-free to such Parent Group Member under the Code,
including any Tax resulting from the failure of the Distribution to qualify
under section 355 and section 368(a)(1)(D) of the Code or the application of
section 355(d) or section 355(e) of the Code to the Distribution or
corresponding provisions of other Tax laws.
     “Domestic Tax” means any Tax imposed under the Code or by any state or
other political subdivision of the United States.
     “Entity” shall mean a partnership (whether general or limited), a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization or any other entity,
without regard to whether it is treated as a disregarded entity for U.S. federal
tax purposes.
     “Final Determination” shall mean the final resolution of any Tax matter,
including, but not limited to, a closing agreement with the IRS or other
relevant Taxing Authority, a claim for refund which has been allowed, a
deficiency notice with respect to which the period for filing a petition with
the Tax Court or the relevant foreign, state or local tribunal has expired, or a
decision of any court of competent jurisdiction that is not subject to appeal or
as to which the time for appeal has expired.
     “Income Tax Return” shall mean any Tax Return filed or required to be filed
with any Taxing Authority with respect to Income Taxes.

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     “Income Taxes” shall mean all Taxes imposed on or measured in whole or in
part by income, capital or net worth or a taxable base in the nature of income,
capital or net worth, including franchise Taxes based on such factors, and shall
include any addition to Tax, additional amount, interest and penalty imposed
with respect to such Taxes.
     “Indemnified Party” shall mean any party that is entitled to receive
payment from an Indemnifying Party pursuant to the terms and conditions of this
Agreement.
     “Indemnifying Party” shall mean any party that is required to pay any other
party pursuant to the terms and conditions of this Agreement.
     “IRS” shall mean the United States Internal Revenue Service or any
successor thereto, including but not limited to its agents, representatives and
attorneys.
     “Letter Ruling” shall mean any private letter ruling issued by the IRS and
delivered to Parent in connection with the Distribution.
     “Losses” shall mean any loss, cost, fine, penalty, fee, damage, obligation,
liability, payment in settlement, Tax or other expense of any kind, including
reasonable attorneys’ fees and costs, but excluding any consequential, special,
punitive or exemplary damages.
     “Officer’s Certificate” shall mean any letter executed by officers of
Parent and CCO provided to tax counsel in connection with its rendering the Tax
Opinion.
     “Parent Group” shall mean Parent and its Subsidiaries, excluding, however,
any CCO Group Member.
     “Parent Group Member” shall mean each member of the Parent Group.
     “Person” shall mean an individual or any Entity.
     “Ruling Request” shall mean any letter filed by Parent with the IRS
requesting a ruling from the IRS regarding certain U.S. federal income tax
consequences of the Distribution (including all attachments, exhibits and other
materials submitted with such ruling request letter) and any amendment or
supplement to such ruling request letter.
     “Subsidiary” shall mean, with respect to any Person, any other Person of
which (i) such Person or any Subsidiary of such Person is a general partner or
(ii) at least 50% of the securities or other interests having by their terms
ordinary voting power to elect a majority of the Board of Directors or others
performing similar functions with respect to the other Person or at least 50% of
the value of the outstanding equity is directly or indirectly owned or
controlled by such Person or by any one or more of its Subsidiaries, or by such
Person and one or more of its Subsidiaries.
     “Tax Benefit” shall mean a reduction in the Income Tax liability of any
Person (or of the Affiliated Group of which it is a member) for any Taxable
Period. Except as otherwise provided in this Agreement, a Tax Benefit shall be
deemed to have been realized or received from a Tax Item in a Taxable Period
only if, and to the extent that, the Income Tax liability of the Person (or of
the Affiliated Group of which it is a member) for such Tax Period is less than
it would have been if such Income Tax liability were determined without regard
to such Tax Item.

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     “Tax Controversy” shall mean any examination, audit, claim, dispute,
litigation, proposed settlement, proposed Adjustment or related matter with
respect to Income Taxes.
     “Tax Detriment” shall mean an increase in the Income Tax liability of any
Person (or of the Affiliated Group of which it is a member) for any Taxable
Period. Except as otherwise provided in this Agreement, a Tax Detriment shall be
deemed to have been realized or suffered from a Tax Item in a Taxable Period
only if, and to the extent that, the Income Tax liability of the Person (or the
Affiliated Group of which it is a member) for such period is greater than it
would have been if such Income Tax liability were determined without regard to
such Tax Item.
     “Tax Item” shall mean any item of income, gain, loss, deduction, credit,
recapture of credit, foreign tax credit, alternative minimum tax credit, net
operating loss, net capital loss or any other item which may have the effect of
increasing or decreasing Income Taxes paid or payable by any Person (or the
Affiliated Group of which it is a member).
     “Tax Opinion” shall mean any opinion rendered by tax counsel addressing
certain U.S. federal income tax consequences of the Distribution under section
355 of the Code.
     “Tax Return” shall mean any return, report, form or other information filed
or required to be filed with any Taxing Authority with respect to Taxes.
     “Taxable Period” shall mean any taxable year or portion thereof, including
any Post-Closing IPO Straddle Period and any Pre-Closing Deconsolidation
Straddle Period.
     “Taxes” shall mean all federal, state, local, foreign or other governmental
taxes, assessments, duties, fees, levies or similar charges of any kind,
including all income, profits, franchise, excise, property, use, intangibles,
sales, value-added, ad valorem, payroll, employment, withholding, estimated and
other taxes of any kind whatsoever, whether disputed or not, and including all
additions to tax, additional amounts, interest and penalties imposed with
respect to such taxes.
     “Taxing Authority” shall mean, with respect to any Tax, the government or
governmental or regulatory body thereof, or political subdivision thereof,
whether federal, state, local or foreign, or any agency, instrumentality or
authority thereof, that imposes such Tax, and the agency (if any) charged with
the collection of such Tax, including the IRS.
     Other capitalized terms defined elsewhere in this Agreement shall have the
meaning given them.
     Section 2. Tax Payments.
     (a) Estimated Income Tax Payments. For each Taxable Period beginning after
the date of the IPO, CCO shall pay, or cause to be paid, to Parent the amount of
any estimated Income Taxes owed by any CCO Group Member and paid by Parent on
such CCO Group Member’s behalf, whether or not such estimated Income Tax is
attributable

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to an Income Tax Return filed on a consolidated, combined or unitary basis with
any Parent Group Member (“Estimated Income Tax Payments”). In the case of any
Estimated Income Tax Payments with respect to which any CCO Group Member joins
any Parent Group Member in filing an Income Tax Return on a consolidated,
combined or unitary basis, the amount of such Estimated Income Tax Payments that
are owed to Parent by such CCO Group Member shall be determined as if such CCO
Group Member filed a separate Income Tax Return based solely on the income,
apportionment factors and other Tax Items of such CCO Group Member. For any
Taxable Period that begins prior to and ends after the date of the IPO (an “IPO
Straddle Period”), the Estimated Income Tax Payments of such CCO Group Member
shall be determined based on the Tax Items of such CCO Group Member that accrue
after the date of the IPO (a “Post-Closing IPO Straddle Period”), calculated as
if there were an interim closing of the books of such CCO Group Member as of the
close of business on the date of the IPO. For any Taxable Period that begins
prior to and ends after the date of a Deconsolidation Event (a “Deconsolidation
Straddle Period”), the Estimated Income Tax Payments of such CCO Group Member
shall be determined based on the Tax Items of such CCO Group Member that accrue
before or on the date of the Deconsolidation Date (a “Pre-Closing
Deconsolidation Straddle Period”), calculated as if there were an interim
closing of the books of such CCO Group Member as of the close of business on the
date of the Deconsolidation Event. For purposes of determining the amount of
Estimated Income Tax Payments of each CCO Group Member, to the extent that such
CCO Group Member would be entitled to file an Income Tax Return with respect to
the applicable Income Tax on a consolidated, combined or unitary basis with any
other CCO Group Member, the Estimated Income Tax Payments of such CCO Group
Members shall be determined as though such CCO Group Members filed an Income Tax
Return with respect to such Income Tax on a consolidated, combined or unitary
basis based solely on the income, apportionment factors and other Tax Items of
such CCO Group Members.
     (b) Separate Income Tax Liability. For each Taxable Period beginning after
the IPO, CCO shall pay, or cause to be paid, to Parent an amount equal to the
excess, if any, of (i) the Income Taxes incurred by any CCO Group Member under
applicable Tax law and paid by Parent on such CCO Group Member’s behalf or, in
the case of any Income Tax with respect to which any CCO Group Member joins any
Parent Group Member in filing an Income Tax Return on a consolidated, combined
or unitary basis, the amount of Income Taxes that would be incurred by the CCO
Group Member had such CCO Group Member filed a separate Income Tax Return based
solely on the income, apportionment factors and other Tax Items of such CCO
Group Member (“Separate Income Tax Liability”), over (ii) the aggregate amount
of Estimated Income Tax Payments actually made to Parent with respect to the
Separate Income Tax Liability for such Taxable Period. If the aggregate amount
of Estimated Income Tax Payments actually made to Parent with respect to the
Separate Income Tax Liability for such Taxable Period exceeds such Separate
Income Tax Liability, Parent shall pay to CCO an amount equal to such excess. In
addition, to the extent that any Parent Group Member utilizes for any Taxable
Period beginning after the date of the IPO, any Tax Items, which are
attributable to any CCO Group Member, and such utilization results in a Tax
Benefit being realized by such Parent Group Member (treating any Tax Items
attributable to the Parent Group as utilized prior to the utilization of any Tax
Items attributable to the CCO

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Group), then Parent shall pay to CCO the amount of such Tax Benefit at the time
of the filing of the Income Tax Return reflecting the realization of the Tax
Benefit and such Tax Items for which Parent has paid CCO shall not be utilizable
by any CCO Group Member for purposes of computing such CCO Group Member’s
Estimated Income Tax Payments or Separate Income Tax Liability. For purposes of
determining the amount of a CCO Group Member’s Separate Income Tax Liability, to
the extent that such CCO Group Member would be entitled to file an Income Tax
Return on a consolidated, combined or unitary basis with any other CCO Group
Member, the Separate Income Tax Liability of such CCO Group Members shall be
determined as though such CCO Group Members had filed a consolidated, combined
or unitary Income Tax Return based solely on the income, apportionment factors
and other Tax Items of such CCO Group Members.
     (c) Additional Calculations. For purposes of determining the amount of a
CCO Group Member’s Estimated Income Tax Payments and Separate Income Tax
Liability, Parent shall be entitled to claim all deductions arising by reason of
the exercise of any stock options to purchase shares of Parent stock, or arising
by reason of the payment of deferred or other compensation by Parent to the
extent such payment is not reimbursed by CCO. In addition, for purposes of any
Income Tax Return filed by, with respect to or on behalf of, any CCO Group
Member (whether or not such CCO Group Member files an Income Tax Return on a
consolidated, combined or unitary basis with any Parent Group Member), Parent
shall be, to the extent permitted by applicable Tax law, entitled to claim all
deductions arising by reason of the exercise of any stock options to purchase
Parent stock or arising by reason of the payment of deferred or other
compensation by Parent to the extent such payment is not reimbursed by CCO. If,
pursuant to a Final Determination, all or any part of such deduction is
disallowed or is proposed to be disallowed to Parent then, to the extent
permitted by applicable Tax law, the appropriate CCO Group Member shall report
such deduction on its Income Tax Return (including an amended Income Tax
Return). If a CCO Group Member realizes a Tax Benefit in any Taxable Period
beginning after the date of the IPO, as a result of a deduction arising by
reason of the exercise of any stock option to purchase shares of Parent stock or
arising by reason of the payment of deferred or other compensation by Parent to
the extent such payment is not reimbursed by CCO, CCO shall pay the amount of
such Tax Benefit to Parent.
     (d) Timing. For each Taxable Period beginning after the date of the IPO,
Parent shall prepare and deliver to CCO a schedule (the “Schedule”) showing in
reasonable detail Parent’s calculation of any Estimated Income Tax Payments or
Separate Income Tax Liability, as the case may be, of each CCO Group Member and,
subject to Section 7, (i) CCO shall pay to Parent the amount of any Estimated
Income Tax Payments or Separate Income Tax Liability shown on the Schedule no
later than the later of (A) fifteen days before the date that such payment is
due and payable to the applicable Taxing Authority and (B) ten days after CCO’s
receipt of the Schedule, and (ii) any payments by Parent to CCO required
pursuant to Section 2(b) hereof shall be made, based on the Schedule, no later
than the date such consolidated, combined or unitary Income Tax Return is filed
with the applicable Taxing Authority. Except as otherwise provided herein, all
indemnification or other payments to be made pursuant to this Agreement shall be
made within fifteen days of written notice of a request for

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indemnification or payment by the Indemnified Party, which notice shall be
accompanied by a computation of the amount due. If any payments required to be
made pursuant to this Agreement (including Estimated Income Tax Payments) are
not made when due, such payments shall bear interest at the prevailing large
corporate underpayment rate as determined under section 6621(c) of the Code.
     (e) Adjustments. If, as a result of a Final Determination, there is an
Adjustment that would have the effect of increasing or decreasing a CCO Group
Member’s Separate Income Tax Liability for Taxable Periods beginning after the
date of the IPO, then CCO shall pay to Parent the amount of any increased
Separate Income Tax Liability, and Parent shall pay to CCO the amount of any
decreased Separate Income Tax Liability; provided, however, that Parent’s
payment to CCO shall not exceed the net amount of payments received by Parent
from CCO with respect to the Separate Income Tax Liability for such Taxable
Periods. If, as a result of a Final Determination, there is an Adjustment to any
of the Tax Items attributable to any CCO Group Member which resulted in a
payment by Parent to CCO pursuant to Section 2(b) of this Agreement that would
have the effect of increasing or decreasing the Tax Benefit to the Parent Group
Member utilizing such Tax Item, then CCO shall pay to Parent the amount of any
decreased Tax Benefit and Parent shall pay to CCO the amount of any increased
Tax Benefit.
     (f) Other Adjustments and Indemnification. If, as a result of a Final
Determination, there is an Adjustment with respect to any Tax Item of any CCO
Group Member for any Taxable Period ending on or before the date of the IPO,
including any portion of a IPO Straddle Period ending on the date of the IPO,
that results in a Tax Detriment being realized by any Parent Group Member, or by
any CCO Group Member for which the Parent Group is otherwise liable, then CCO
shall indemnify Parent against such Tax Detriment. In addition, if there is an
Adjustment pursuant to section 482 of the Code or similar authority under
applicable Tax law which results in a Tax Detriment being realized by any Parent
Group Member or any CCO Group Member, on the one hand, and a corresponding Tax
Benefit being realized by any CCO Group Member or any Parent Group Member, on
the other, which is not otherwise taken into account through payments or
indemnification under this Agreement, then CCO shall pay to Parent or Parent
shall pay to CCO, as the case may be, the amount of such Tax Benefit. Parent
shall indemnify CCO to the extent that any CCO Group Member becomes liable for
the Income Tax liability of any Parent Group Member, as a result of being a
member of the Affiliated Group of which Parent is the common parent corporation,
for federal tax purposes, or a member of the combined, consolidated or unitary
group, for foreign, state or local tax purposes, which includes any Parent Group
Member, in excess of the Separate Income Tax Liability of such CCO Group Member,
and, except as otherwise provided herein, Parent shall indemnify CCO against any
Income Tax liability for which CCO has paid to Parent pursuant to this
Agreement.
     (g) Reimbursements. Notwithstanding the foregoing, each CCO Group Member
shall be jointly and severally liable to Parent for, and CCO, on behalf of each
CCO Group Member, shall pay, or caused to be paid, any payment made by Parent on
behalf of any CCO Group Member for Taxes owed by such CCO Group Member other
than pursuant to this Agreement within five days of receipt of written
notification from Parent that such payment has been made.

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     Section 3. Income Tax Return Preparation. For Domestic Tax purposes, Parent
shall prepare and file, or cause to be prepared and filed, all Income Tax
Returns that are required under applicable law to be filed by, with respect to
or on behalf of, any CCO Group Member (whether or not such CCO Group Member
files an Income Tax Return on a consolidated, combined or unitary basis with any
Parent Group Member for such Domestic Tax purposes), including, without
limitation, all Income Tax Returns which Parent determines shall be filed on a
consolidated, combined or unitary basis with any Parent Group Member, for any
IPO Straddle Period and any Taxable Period beginning before a Deconsolidation
Event. CCO shall reimburse Parent for an allocable portion of its expenses
incurred in preparing and filing such Income Tax Returns on behalf of any CCO
Group Member, as such allocation is reasonably determined by Parent.
     Section 4. Audits. Parent shall have sole responsibility for and control
over any Tax Controversy with respect to Domestic Taxes of each CCO Group
Member. CCO shall reimburse Parent for an allocable portion of its expenses
incurred in conducting such Tax Controversies on behalf of any CCO Group Member,
as such allocation is reasonably determined by Parent.
     Section 5. Cooperation.
     (a) Tax Information.
     (i) CCO shall, and shall cause each CCO Group Member, to cooperate with
Parent in the preparation and filing of Income Tax Returns, as described in
Section 3, or in the conduct of Tax Controversies, as described in Section 4, by
maintaining such books and records and providing on a timely basis such
information as may be necessary or useful in the filing of such Income Tax
Returns or the conduct of such Tax Controversies and executing any documents,
providing any further information and taking any actions which Parent may
reasonably request in connection therewith.
     (ii) If any CCO Group Member fails to provide any information requested
pursuant to this Section 5 on a timely basis, then Parent shall have the right
to engage an independent certified public accountant of its choice to gather
such information. CCO agrees to permit any such independent certified public
accountant full access to all Income Tax Returns and other relevant information
in the possession of any CCO Group Member during reasonable business hours, and
to reimburse or pay directly all costs and expenses incurred in connection with
the engagement of such independent certified public accountant.
     (iii) If any CCO Group Member supplies information to a Parent Group Member
in connection with the preparation and filing of any Income Tax Return or in
connection with the conduct of any Tax Controversy and an officer of the
requesting party signs a statement or other document under penalties of perjury
in reliance upon the accuracy of such information, then a duly authorized
officer of

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the party supplying such information shall certify, under penalties of perjury,
the accuracy and completeness of the information so supplied. CCO shall
indemnify and hold harmless each Parent Group Member and its respective officers
and employees, against any cost, fine, penalty or other expenses of any kind
attributable to an CCO Group Member supplying a Parent Group Member with
inaccurate or incomplete information, in connection with the preparation and
filing of any Income Tax Return or in connection with the conduct of any Tax
Controversy.
     (b) Other Cooperation.
     (i) Whenever any CCO Group Member learns of a breach or a violation of any
obligation or provision contained in this Agreement, or receives in writing from
any Taxing Authority notice of an Adjustment which may give rise to a payment
under this Agreement, CCO shall give notice to Parent within ten days of such
CCO Group Member becoming aware of such breach, violation or receipt, but if a
Parent Group Member is required to respond to the IRS or any other Taxing
Authority, such notice shall be given no less than ten days before such response
is required.
     (ii) Parent may consult with CCO, and CCO agrees to fully cooperate with
Parent in the negotiation, settlement or litigation of any liability for Income
Taxes of any Parent Group Member, regardless of the effect of any such
negotiation, settlement or litigation on the Separate Income Tax Liability of
any CCO Group Member.
     (c) Agent. CCO, on behalf of itself and each other CCO Group Member, hereby
appoints Parent as its agent (i) for the purpose of preparing and filing any
Income Tax Return of such CCO Group Member as set forth in Section 3 (whether or
not such Income Tax Return is filed on a consolidated, combined or unitary basis
with any Parent Group Member), (ii) for the purpose of representing such CCO
Group Member in the course of any Tax Controversy as set forth in Section 4, and
(iii) for the purpose of making any election or taking any action in connection
with any of the foregoing on behalf of each CCO Group Member. CCO, on behalf of
itself and each other CCO Group Member, hereby consents to the preparation and
filing of each such Income Tax Return and to the making of any elections and the
taking of any action as set forth above.
     Section 6. Retention of Records. CCO agrees to retain, and cause each CCO
Group Member to retain, the appropriate records which may affect the
determination of the Separate Income Tax Liability of any CCO Group Member or
the Income Tax liability of any Parent Group Member which files an Income Tax
Return on a consolidated, combined or unitary basis with any CCO Group Member
until such time as there has been a Final Determination with respect thereto.
Any CCO Group Member intending to destroy any materials, records, or documents
relating to Income Taxes shall provide Parent with 90 days advance notice and
the opportunity to copy or take possession of such materials, records and
documents.

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     Section 7. Resolution of Disputes. Any dispute concerning the calculation
or basis of determination of any payment provided for hereunder shall be
resolved by the independent certified public accountants for Parent, whose
judgment shall be conclusive and binding upon the parties.
     Section 8. Spin-Off of CCO.
     (a) Indemnities for Distribution Taxes.
     (i) CCO’s Indemnity of Parent. Notwithstanding any provision of this
Agreement to the contrary, including Section 8(a)(iii), CCO shall indemnify
Parent, each other Parent Group Member and their respective directors, officers
and employees, and hold them harmless from and against any and all Distribution
Taxes and Losses, on an after-Tax basis, resulting from the Distribution not
qualifying as a tax-free distribution under section 355 of the Code to the
extent such Distribution Taxes and Losses arise from or are attributable to:
     (1) any act, failure to act or omission of or by any CCO Group Member that
is inconsistent with any material, information, covenant or representation in
the Officer’s Certificate or the Ruling Request;
     (2) any act, failure to act or omission of or by any CCO Group Member after
the Distribution Date, including a cessation, transfer to Affiliates or
disposition of its active trades or businesses, or an issuance of stock, stock
buyback or payment of an extraordinary dividend by any CCO Group Member
following the Distribution Date;
     (3) any acquisition of any stock or assets of any CCO Group Member by one
or more Persons prior to or following the Distribution Date;
     (4) any issuance by any CCO Group Member, or change in ownership of stock
of any CCO Group Member, that causes section 355(d) or section 355(e) of the
Code to apply to the Distribution; or
     (5) a breach of any covenant set forth in Section 8(b)(i).
     (ii) Parent’s Indemnity of CCO. Notwithstanding any provision of this
Agreement to the contrary, including Section 8(a)(iii), Parent shall indemnify
CCO, each other CCO Group Member and their respective directors, officers and
employees, and hold them harmless from and against any and all Distribution
Taxes and Losses, on an after-Tax basis, resulting from the Distribution not
qualifying as a tax-free distribution under section 355 of the Code to the
extent such Distribution Taxes and Losses arise from or are attributable to:
     (1) any act, failure to act or omission of or by any Parent Group Member
that is inconsistent with any material, information, covenant or representation
in the Officer’s Certificate or the Ruling Request;

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     (2) any act, failure to act or omission of or by any Parent Group Member
after the Distribution Date, including a cessation, transfer to Affiliates or
disposition of its active trades or businesses, or an issuance of stock, stock
buyback or payment of an extraordinary dividend by any Parent Group Member
following the Distribution Date;
     (3) any acquisition of any stock or assets of any Parent Group Member by
one or more Persons prior to or following the Distribution Date; or
     (4) any issuance by any Parent Group Member, or change in ownership of
stock of any Parent Group Member, that causes section 355(d) or section 355(e)
of the Code to apply to the Distribution.
     (iii) Joint Responsibility for Distribution Taxes. Except as provided in
Sections 8(a)(i) and (ii), Parent and CCO shall each indemnify the other, and
its Affiliates, and their respective directors, officers and employees and hold
them harmless from and against fifty percent (50%) of any and all Distribution
Taxes and Losses, on an after-Tax basis, that result from the Distribution not
qualifying as a tax-free distribution under section 355 of the Code.
     (b) Covenants of CCO. During the 2 year period following the Distribution
Date, CCO shall not, and shall not permit any other CCO Group Member to, without
the prior written consent of Parent, which may be granted or withheld in its
sole discretion: (1) sell or transfer all or substantially all of the assets
comprising the active trade or business relied upon in connection with the
Letter Ruling or any interest in any Entity that conducts such active trade or
business; (2) merge with another Entity, without regard to which party is the
surviving Entity; and (3) issue or cause to be issued stock of any CCO Group
Member (or any instrument that is convertible or exchangeable into any such
stock) in an acquisition or public or private offering, and shall not issue
stock of CCO (or any instrument that is convertible or exchangeable into any
such stock) in an acquisition or public or private offering.
     (c) Cooperation with Letter Ruling and Tax Opinion. In its sole discretion
and control, Parent shall have the right to seek and obtain the Letter Ruling
and the Tax Opinion. CCO shall, and shall cause each other CCO Group Member to,
assist and cooperate with Parent and take all actions requested by Parent in
connection with (i) any Ruling Request submitted by Parent to the IRS to obtain
the Letter Ruling and (ii) obtaining the Tax Opinion. Such assistance and
cooperation shall include making any representation or covenant or providing any
material or information requested by Parent, the IRS or tax counsel rendering
the Tax Opinion; provided, no CCO Group Member shall be required to make any
representation or covenant that is inconsistent with historical facts or as to
future matters or event over which it has no control.

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     Section 9. Miscellaneous.
     (a) Taxable Periods Prior to IPO. With respect to Tax matters that relate
or are attributable to Taxable Periods (or portions thereof) that end on or
before the date of the IPO, which Tax matters, include, without limitation, the
preparation and filing of Income Tax Returns and the allocation of Tax Items and
the responsibility for Taxes among the Parent Group Members and the CCO Group
Members, such Tax matters shall continue to be administered in a manner and on a
basis consistent with Parent’s past practice as in effect immediately prior to
the IPO as may be determined by Parent.
     (b) Term of the Agreement. This Agreement shall become effective as of the
date of its execution and, except as otherwise expressly provided herein, shall
continue in full force and effect indefinitely.
     (c) Injunctions. The parties acknowledge that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with its specific terms or were otherwise breached. The
parties hereto shall be entitled to an injunction or injunctions to prevent
breaches of the provisions of this Agreement and to enforce specifically the
terms and provisions hereof in any court having jurisdiction, such remedy being
in addition to any other remedy to which they may be entitled at law or in
equity.
     (d) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect, and shall
in no way be affected, impaired or invalidated. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such which may be hereafter declared invalid, void or unenforceable. In the
event that any such term, provision, covenant or restriction is held to be
invalid, void or unforeseeable, the parties hereto shall use their best efforts
to find and employ an alternate means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction.
     (e) Assignment. Except by operation of law or in connection with the sale
of all or substantially all the assets of a party hereto, this Agreement shall
not be assignable, in whole or in part, directly or indirectly, by any party
hereto without the advance written consent of the other party, and any attempt
to assign any rights or obligations arising under this Agreement without such
consent shall be void; provided, however, that the provisions of this Agreement
shall be binding upon, inure to the benefit of and be enforceable by, the
parties hereto and their respective successors and permitted assigns.
     (f) Further Assurances. Subject to the provisions hereof, the parties
hereto shall make, execute, acknowledge and deliver such other instruments and
documents, and take all such other actions, as may be reasonably required in
order to effectuate the purposes of this Agreement and to consummate the
transactions contemplated hereby. Subject to the provisions hereof, each of the
parties shall, in connection with entering into

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this Agreement, performing its obligations hereunder and taking any and all
actions relating hereto, comply with all applicable laws, regulations, orders
and decrees, obtain all required consents and approvals and make all required
filings with any Taxing Authority, governmental agency, other regulatory or
administrative agency, commission or similar authority, and promptly provide the
other parties with all such information as they may reasonably request in order
to be able to comply with the provisions of this sentence.
     (g) Parties in Interest. Except as herein otherwise specifically provided,
nothing in this Agreement expressed or implied is intended to confer any right
or benefit upon any Person other than the parties hereto, their respective
successors and permitted assigns, and any Subsidiary that subsequently becomes a
Parent Group Member or a CCO Group Member.
     (h) Waivers, Etc. No failure or delay on the part of the parties in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such right or power, preclude
any other or further exercise thereof or the exercise of any other right or
power. No modification or waiver of any provision of this Agreement, nor the
consent to any departure by the parties therefrom, shall in any event be
effective unless the same shall be in writing, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given.
     (i) Setoff. All payments to be made by any party under this Agreement shall
be made without setoff, counterclaim or withholding, all of which are expressly
waived.
     (j) Change of Law. If, due to any change in applicable law or regulations
or their interpretation by any court of law or other governing body having
jurisdiction subsequent to the date of this Agreement, the performance of any
provision of this Agreement or any transaction contemplated hereby shall become
impracticable or impossible, the parties hereto shall use their best efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such provision.
     (k) Confidentiality. Subject to any contrary requirement of law and the
right of each party to enforce its rights hereunder in any arbitration or legal
action, each party agrees that it shall keep strictly confidential, and shall
cause its employees and agents to keep strictly confidential, any information
which it or any of its employees or agents may acquire pursuant to, or in the
course of performing its obligations under, any provision of this Agreement.
     (l) Headings. Descriptive headings are for convenience only and shall not
control or affect the meaning or construction of any provision of this
Agreement.
     (m) Counterparts. For the convenience of the parties, any number of
counterparts of this Agreement may be executed by the parties hereto, and each
such executed counterpart shall be, and shall be deemed to be, an original
instrument.

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     (n) Notices. All notices, consents, requests, instructions, approvals and
other communications provided for herein shall be validly given, made or served,
if in writing and delivered personally, by telegram or sent by registered mail,
postage prepaid, or by facsimile transmission to:
     Parent at:
Clear Channel Communications, Inc.
200 E. Basse Road
San Antonio, Texas 78209
Attn: Chief Executive Officer
Fax: (210) 822-2299
     CCO at:
Clear Channel Outdoor Holdings, Inc.
2850 E. Camelback Road
Phoenix, Arizona 85016
Attention: President
Fax: (602) 957-8602
or to such other address as any party may, from time to time, designate in a
written notice given in a like manner. Notice delivered personally or given by
telegram shall be deemed delivered when received by the recipient. Notice given
by mail as set out above shall be deemed delivered five calendar days after the
date the same is mailed. Notice given by facsimile transmission shall be deemed
delivered on the day of transmission provided telephone confirmation of receipt
is obtained promptly after completion of transmission.
     (o) Costs and Expenses. Unless otherwise specifically provided herein, each
party agrees to pay its own costs and expenses resulting from the exercise of
its respective rights or the fulfillment of its respective obligations
hereunder.
     (p) Applicable Law. This Agreement shall be governed by and construed and
enforced in accordance with the domestic substantive laws of the State of Texas
without regard to any choice or conflict of laws, rules or provisions that would
cause the application of the domestic substantive laws of any other
jurisdiction.
[Signature Page Follows]

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     IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly
executed by their respective officers, each of whom is duly authorized, all as
of the day and year first above written.

            CLEAR CHANNEL COMMUNICATIONS, INC.
      By:   /s/ Mark P. Mays         Name:   Mark P. Mays        Title:  
President and Chief Executive Officer        CLEAR CHANNEL OUTDOOR HOLDINGS,
INC.
      By:   /s/ Paul J. Meyer         Name:   Paul J. Meyer        Title:  
President and Chief Operating Officer     

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