Document:

FIRST AMENDMENT

  Exhibit 10.2
  
 FIRST AMENDMENT
TO AMENDED AND RESTATED AGREEMENT AND CERTIFICATE OF LIMITED
PARTNERSHIP
OF
CHERRYWOOD ASSOCIATES
 This First Amendment to Amended and Restated Agreement and Certificate of Limited Partnership of Cherrywood Associates (this "Amendment"), is dated for reference purposes only August 10, 2011, by and between James R. Tomlinson, an individual, Thomas E. Dillon, an individual, Gerald C. Bauman, an individual (collectively, the "Operating General Partner"); Real Estate Associates Limited II, a California limited partnership (the "Withdrawing Limited Partner" and together with the Operating General Partner, each a "Party" and any two or more, as the context requires, collectively, the "Parties"), with reference to the following:
 A.                                   Cherrywood Associates (the "Partnership") was formed as a limited partnership under the laws of the State of Idaho and is being governed pursuant to an Amended and Restated Agreement and Certificate of Limited Partnership, dated as of April 21, 1980 (the "Partnership Agreement").
 B.                                     The Parties desire to enter into this Amendment to provide for, among other things (i) the withdrawal of the Withdrawing Limited Partner from the Partnership as the Limited Partner of the Partnership, (ii) the transfer of the entire limited partnership interest of the Withdrawing Limited Partner in the Partnership to Gerald C. Bauman, an individual (the "Incoming Limited Partner") and (iii) other amendments to the Partnership Agreement.
 NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth, and for such other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties agree that the Partnership Agreement is amended as follows:
 1.                  Capitalized terms not defined in this Amendment shall have the meanings set forth in the Partnership Agreement.
 2.                  Effective as of the date that the Withdrawing Limited Partner has received the sum of $650,000.00 from the Incoming Limited Partner (the "Effective Date"), which payment the Withdrawing Limited Partner acknowledges shall be treated as a direct acquisition of the "Interest" (as that term is defined below) and in full satisfaction of all obligations and liabilities due the Withdrawing Limited Partner in connection with or in any manner arising out of the Partnership, the Project or any other assets owned by the Partnership on the Effective Date:
 (a)            The Withdrawing Limited Partner withdraws from the Partnership, it acknowledges that it has no further interest therein and its entire interest in the Partnership, including; but not limited to, its right to and/or interests in all Cash From Operations, Net Refinancing Cash, Cash from Disposition or Partial Disposition and other Partnership distributions, other Partnership funds and assets, and any reimbursements of expenses, repayments of any loans made by the Withdrawing Limited Partner or any Affiliate to the Partnership (collectively, the "Interest"), is transferred to the Incoming Limited Partner; and
 (b)            The Incoming Limited Partner assumes and agrees to perform all of the obligations of the Limited Partner under the Partnership Agreement.
  
 Notwithstanding the foregoing to the contrary, if the Effective Date has not occurred or before August 17, 2011, then notwithstanding anything herein contained to the contrary, this Amendment shall be of no force or effect.
 3.                                           Notwithstanding the withdrawal of the Withdrawing Limited Partner, each of the other Partners elects to continue the business of the Partnership.
 4.                     The defined term "Limited Partner" is deleted in its entirety and replaced with the following:
 "Limited Partner" means Gerald C. Bauman, or his successors and assigns.
 5.                     The address for the Limited Partner in Section 13.2.2 of the Partnership Agreement is deleted in its entirety and replaced with the following:
 Gerald C. Bauman
 c/o Tomlinson & Associates, Inc.
 P.O. Box 108
 Boise, ID 83701
 6.                     As a material inducement to the Withdrawing Limited Partner entering into this Amendment, the Operating General Partner represents and warrants to the Withdrawing Limited Partner that the following are true and correct:
 (a)              The Partnership at all times has been and continues to be a limited partnership duly organized, validly existing and in good standing under the laws governing limited partnerships, as adopted in the state of its formation. The Partnership has taken all requisite action in order to conduct lawfully its business in the state in which the Project is situated, and is not qualified or licensed to do business and is not required to be so qualified or licensed in any other jurisdiction. The Partnership has the full power and authority to carry on its business, including without limitation, to own, lease and operate the Project.
 (b)              (i) The execution and delivery of this Amendment by the Operating General Partner and the performance of the transactions contemplated herein have been duly authorized by all requisite corporate and partnership proceedings, and (ii) assuming the due and proper execution and delivery by the Withdrawing Limited Partner, this Amendment is binding upon and enforceable against the Operating General Partner in accordance with its terms.
 (c)              The Partnership has obtained all necessary consents and approvals for the transactions contemplated by this Agreement, including, but not limited to, the consent of the holders of all Mortgages and all Governmental Agencies, including, but not limited to, HUD.
 7                      .                       As a material inducement to the Withdrawing Limited Partner entering into this Amendment, the Incoming Limited Partner hereby represents and warrants to the Withdrawing Limited Partner that the following are true and correct :
 (a)             The execution and delivery of this Amendment by the Incoming Limited Partner and the performance of the transactions contemplated herein have been duly authorized by all requisite corporate and partnership proceedings.
  
 (b)                                Assuming the due and proper execution and delivery by the Withdrawing Limited Partner, this Amendment is binding upon and enforceable against the Incoming Limited Partner in accordance with its terms.
 (c)                                No proceeding before any federal, state, municipal or other governmental department, commission, board or agency is pending against the Incoming Limited Partner or, to the knowledge of the Incoming Limited Partner, threatened against the Incoming Limited Partner pursuant to which an unfavorable judgment would restrain, prohibit, invalidate, set aside, rescind, prevent or make unlawful this Amendment or the transactions contemplated hereunder, nor does the Incoming Limited Partner know of any reason to believe any such proceeding will be instituted.
 (d)                                The Incoming Limited Partner has incurred no obligation or liability, contingent or otherwise, for brokerage or finders' fees or agents' commissions or other similar payment in connection with this Amendment.
 (e)                                The Incoming Limited Partner is aware of the restrictions on transfer or encumbrance of the Interest under the Partnership Agreement, as well as the transfer restrictions imposed by the Securities Act of 1933, as amended, and applicable state securities laws (the "Securities Laws"). The Incoming Limited Partner is able to bear the economic risk of its investment in the Interest, is aware that it must hold the Interest for an indefinite period and that the Interest has not been registered under the applicable Securities Laws and may not be sold or otherwise transferred unless permitted by the terms of the Partnership Agreement and the Interest is registered, or an exemption from the registration requirements is available with respect thereto, under the Securities Laws. The Incoming Limited Partner is acquiring the Interest for its own account and not with a view to resell, transfer or otherwise dispose thereof.
 (f)                       The Incoming Limited Partner is an Affiliate of the Operating General Partner and, knows, therefore, at least as much about the Partnership as the Withdrawing Limited Partner. The Incoming Limited Partner is experienced in financial transactions such as ownership of the Interest and understands the business and operations of the Partnership and its ownership and operation of the Project. The Incoming Limited Partner has had an opportunity to ask questions about and seek information about the Interest, the Partnership and the Project, and has not relied upon any express or implied representations or warranties from the Withdrawing Limited Partner with regard to the Interest, the Partnership or the Project, except as expressly provided herein.
 8.                                           As a material inducement to the Operating General Partner and the Incoming Limited Partner entering into this Amendment, the Withdrawing Limited Partner represents and warrants that the following are true and correct:
 (a)              The Withdrawing Limited Partner has at all times been and continues to be duly organized, validly existing and in good standing under the laws governing limited partnerships, as adopted in the state of its formation.
 (b)              The Withdrawing Limited Partner is the owner of the Interest, the Interest is not subject to any lien, pledge or encumbrance of any nature whatsoever and the Incoming Limited Partner shall acquire the same free of any rights or claims thereto by any other party claiming by, through or under the Withdrawing Limited Partner, and prior to the Effective Date the Withdrawing Limited Partner has not sold, assigned, conveyed or otherwise transferred any interest in the Partnership which was granted to the Withdrawing Limited Partner as the "Limited Partner."
 (c)            The execution and delivery of this Amendment by the Withdrawing Limited Partner and the performance of the transactions contemplated herein have been duly authorized by all requisite corporate and partnership proceedings and, assuming the due and proper execution and delivery by the Operating General Partner and the Incoming Limited Partner, this Amendment is binding upon and enforceable against the Withdrawing Limited Partner in accordance with its terms.
 (d)            To the Withdrawing Limited Partner's knowledge, there is no litigation, action, proceeding, investigation or claim pending or threatened against or involving the Interest, or which questions the validity of this Amendment, and, to the Withdrawing Limited Partner's knowledge, there is no fact or circumstance which could give rise to any such litigation, action, proceeding, investigation or claim.
 9.                                The representations and warranties set forth above in paragraphs 6, 7, and 8 are true and correct as of the Effective Date and shall survive the withdrawal of the Withdrawing Limited Partner from and the admission of the Incoming Limited Partner into the Partnership as herein contemplated.
 10.                         Notwithstanding the withdrawal of the Withdrawing Limited Partner, the Operating General Partner acknowledges that from and after the Effective Date matters may arise that relate back to events that occurred prior to the Effective Date (for purposes of illustration and not limitation, audits by the IRS). The General Partner agrees that as to such matters (i) the Operating General Partner shall conduct itself in a manner which is consistent with the obligations it had as the Operating General Partner immediately prior to the Effective Date and, accordingly, recognize all of the corresponding rights of the Withdrawing Limited Partner as if the Withdrawing Limited Partner had not withdrawn from the Partnership as provided in this Amendment and (ii) that nothing herein shall relieve the Operating General Partner from such pre-existing obligations. Without limiting the generality of the foregoing, the Operating General Partner shall:
 (a)            file on behalf of the Partnership for the current Fiscal Year a United States Partnership Return of Income and such other tax returns and other documents from time to time as may be required by the federal government or by any state or any subdivision thereof within the time(s) prescribed by law for such filings;
 (b)            deliver to the Withdrawing Limited Partner within sixty (60) days after the end of the current Fiscal Year such tax information, including, without limitation, a copy of Schedule K-1, as shall be reasonably necessary for inclusion by the Withdrawing Limited Partner in its federal income tax returns and required state income tax and other tax returns; and
 (c)            deliver to the Withdrawing Limited Partner the current Fiscal Year certified financial statement of the Partnership as required pursuant to the terms of Section 11.7 of the Partnership Agreement.
 If the Operating General Partner shall fail, for any reason, to prepare and/or deliver to the Withdrawing Limited Partner any of the returns or other information required by this paragraph
 10. the Withdrawing Limited Partner shall have the right to cause such returns and other information prepared at the sole cost and expense of the Operating General Partner, plus an administrative fee payable to the Withdrawing Limited Partner in an amount equal to fifteen percent (15%) of the actual out-of-pocket costs incurred by the Withdrawing Limited Partner to have such returns and information prepared. In furtherance of the foregoing, the Withdrawing Limited Partner and its duly authorized representatives shall have the right to inspect and copy such portions of the Partnership's books of account which are necessary or appropriate for the preparation of such returns and information; provided, however, it is expressly understood and agreed by the Withdrawing Limited Partner that such access is solely for the purpose of preparing such returns or other information that the Operating General Partner failed to prepare and/or deliver as herein provided, and shall not be deemed to grant the Withdrawing Limited Partner any other rights with respect to the Partnership and/or the operation of its business.
 11.                                       Without limiting the generality of the provisions of paragraph 10,
 (a)            Within five (5) calendar days after the sending or the receipt of any correspondence or communication relating to the Partnership to or from the IRS which could affect the Withdrawing Limited Partner, the Operating General Partner, as the "tax matters partner" (as that term is defined in the Code) of the Partnership (the "Tax Matters Partner"), shall promptly forward to the Withdrawing Limited Partner a photocopy of all such correspondence or communication(s).
 (b)            The Tax Matters Partner, shall not, with respect to any matter which could affect the Withdrawing Limited Partner, take any of the following actions without the prior written consent or approval of the Withdrawing Limited Partner:
 (i)               Extend the statute of limitations for assessing or computing any tax liability against the Partnership (or the amount or character of any Partnership tax items);
 (ii)             Settle any audit with the IRS concerning the adjustment or readjustment of any partnership item(s) (within the meaning of Section 6231(a)(3) of the Code);
 (iii)            File a request for an administrative adjustment with the IRS at any time or file a petition for judicial review with respect to any such request;
 (iv)           Initiate or settle any judicial review or action concerning the amount or character of any partnership tax item(s) (within the meaning of Section 6231(a)(3) of the Code); or
 (v)            Intervene in any action brought by any other Partner for judicial review of a final adjustment.
 12.     In the event of any Partnership level proceeding instituted by the IRS pursuant to Sections 6221 through 6233 of the Code which could affect the Withdrawing Limited Partner, the Tax Matters Partner shall consult with the Withdrawing Limited Partner regarding the nature and content of all action and defense to be taken by the Partnership in response to such proceeding. The Tax Matters Partner also shall consult with the Withdrawing Limited Partner regarding the nature and content of any proceeding pursuant to Sections 6221 through 6233 of the Code instituted by or on behalf of the Partnership (including the decision to institute proceedings, whether administrative or judicial, and whether in response to a previous IRS proceeding against the Partnership or otherwise).
  
 13.                         The General Partner approves the withdrawal of the Withdrawing Limited Partner and confirms that there are no unsatisfied conditions or obligations of the Withdrawing Limited Partner under the Partnership Agreement with respect thereto.
 14.                         All of the provisions of this Amendment shall survive the withdrawal of the Withdrawing Limited Partner from the Partnership.
 15.                         Except as amended by this Amendment, the Partnership Agreement remains in full force and effect without change.
 16.                         This Amendment may be executed in counterparts and may be executed by facsimile, each of which shall be deemed to be effective and all of which when taken together, shall constitute one instrument.
 17.                         Each provision of this Amendment shall be considered separate and if for any reason any provision or provisions herein are determined to be invalid or contrary to any existing or future law, such invalidity shall not impair the operation of or affect those portions of this Amendment which are valid, such provision or provisions shall be deemed void and of no effect.
 18.                         The Parties shall execute and deliver such further instruments and do such further acts and things as may be reasonably required to carry out the intent and purposes of this Amendment.
 [Signatures on following page(s)]

  EXECUTED to be effective as of the Effective Date.
  
 OPERATING GENERAL PARTNER:                           /s/James R. Tomlinson
                                                                         JAMES R. TOMLINSON
  
                                                                         /s/Thomas E. Dillon
                                                                         THOMAS E. DILLON
  
                                                           /s/Gerald C. Bauman
                                                           GERALD C. BAUMAN  
  
 LIMITED PARTNER:                                             /s/Gerald C. Bauman
                                                                         GERALD C. BAUMAN
  
 WITHDRAWING LIMITED PARTNER:                      REAL ESTATE ASSOCIATES LIMITED II,
                                                                         a California limited partnership
  
                                                                         By National Partnership Investments Corp.,
                                                                                     a California corporation,
                                                                                     General Partner
  
                                                                                     By  /s/Derek J. Hart
                                                                                           Name:  Derek J. Hart
                                                                                           Title:  Senior Vice Presidentex_10-1.htm

Exhibit 10.1

 

 

                                                                                            

 

	 	 	 Optionee:    William Eccleshare
	 	 	 Date of Agreement:     September 17, 2009
	 	 	 as amended and restated on
	 	 	 August 11, 2011

 

CLEAR CHANNEL OUTDOOR HOLDINGS, INC.

 

2005 STOCK INCENTIVE PLAN, AS AMENDED AND RESTATED

 

AMENDED AND RESTATED STOCK OPTION AGREEMENT

 

THIS AMENDED AND RESTATED STOCK OPTION AGREEMENT (the “Agreement”), made as of this 11th day of August, 2011 by and between Clear Channel Outdoor Holdings, Inc., a Delaware corporation (the “Company”), and William Eccleshare (the “Optionee”), evidences the grant by the Company of Options to purchase a certain number of shares of the Company’s Class A common stock, $.01 par value (the “Common Stock”) to the Optionee on such dates set out below and the Optionee’s acceptance of these Options (as defined below) in accordance with the provisions of the Clear Channel Outdoor Holdings, Inc. 2005 Stock Incentive Plan, as amended and restated (the “Plan”).  This Agreement amends and restates that certain Stock Option Agreement made as of the 17th day of September, 2009 by and between the Company and the Optionee (the “Original Agreement”), and the Optionee hereby acknowledges that the Optionee shall have no further rights to any Options under the Original Agreement which have not been granted as of the date hereof.  All capitalized terms not defined herein shall have the meaning ascribed to them as set forth in the Plan.  The Company and the Optionee agree as follows:

 

1.    Grant of Options.

     

(a)   Subject to the terms and conditions set forth herein and in the Plan, the Company granted to the Optionee the following three options (together with the options to be granted pursuant to Section 1(c) below, the “Options”) to purchase, at the dates set forth below:

            

(i) 40,000 shares of Common Stock (“Option A”), which were granted on September 10, 2009;

 

(ii) 92,163 shares of Common Stock (“Option B”), which were granted on September 10, 2009, and 15,360 shares of which were forfeited on September 10, 2010; and

                                                  

(iii) 63,583 shares of Common Stock (“Option C”), which were granted on September 10, 2010.

                               

The date each Option was granted, or is granted in the future, is referred to as the “Grant Date”.

 

 

  

  

  

 

(b)               The amount payable for each share of the Common Stock in the event of the Options being exercised (the “Option Price”) shall be as follows:

 

                                                    (i) in respect of Option A, USD $7.02;

 

                                                    (ii) in respect of Option B, USD $7.02; and

 

                                                 (iii) in respect of Option C, USD $10.40.

 

(c)           Subject to the terms and conditions set forth herein and in the Plan, the Company will grant to the Optionee, no later than March 31, 2012, an Option to purchase 90,000 shares of Common Stock (“Option D”), with an Option Price equal to the closing price for the Common Stock on the Grant Date, or if there is no closing price for the Common Stock on the Grant Date, on the first preceding date on which shares of Common Stock are traded.

 

2.   Limitations on Exercise of Options.

 

                        (a)            Option A shall become exercisable as follows:

 

(i) half of the shares of Common Stock under Option A shall vest and become exercisable on the first anniversary of the date of signing the employment agreement; and

 

(ii) half of the shares of Common Stock under Option A shall vest and become exercisable on the second anniversary of the date of signing the employment agreement.

 

                        (b)   The remaining 76,803 shares subject to Option B shall become exercisable as follows:

 

(i) with respect to 30,721 of the shares of Common Stock under Option B, one-quarter of such shares shall vest and become exercisable on each of the first, second, third and fourth anniversaries of its Grant Date; and

 

(ii) with respect to 46,082 of the shares of Common Stock under Option B, one-third of such shares shall vest and become exercisable on each of the second, third and fourth anniversaries of its Grant Date.

                

                                (c)   Options C and D shall be exercisable as follows:

 

(i) one-quarter of the shares of Common Stock under each Option shall vest and become exercisable on each of the first, second, third and fourth anniversaries of its Grant Date.

 

3.            Term of the Options.Unless sooner terminated in accordance herewith or in the Plan, the Options shall expire on the tenth anniversary of the Grant Date.

 

 

  

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4.             Method of Exercise.

 

(a)   The Optionee may exercise the Options, from time to time, to the extent then exercisable, by contacting the Company’s outside Plan administrator (the “Administrator”) and following the procedures established by the Administrator. The Option Price of the Options may be paid in cash or by certified or bank check or in any other manner the Compensation Committee of the Company’s Board of Directors (“the Committee”), in its discretion, may permit, including, without limitation, (i) the delivery of previously-owned shares, (ii) by a combination of a cash payment and delivery of previously-owned shares, or (iii) pursuant to a cashless exercise program established and made available through a registered broker-dealer in accordance with applicable law.

 

    (b)   At the time of exercise, the Optionee shall pay to Clear Channel Outdoor Limited (or such third party as it directs) such amount as it deems necessary to meet any liability to tax (including but without limitation income tax under PAYE and employee’s national insurance contributions) which it is obliged to pay or account for to any tax authority in respect of any issue or transfer of any Common Stock on the exercise of the Options (the “Tax Liability”).  The Optionee may elect to pay to Clear Channel Outdoor Limited (or such third party as it directs) an amount equal to the Tax Liability by delivering to Clear Channel Outdoor Limited (or such third party as it directs), cash, a check or at the sole discretion of the Company, shares of Common Stock having a Fair Market Value equal to the amount of the Tax Liability.

 

5.             Issuance of Shares.   Except as otherwise provided in the Plan, as promptly as practical after receipt of notification of exercise and full payment of the Option Price and any Tax Liability, the Company shall issue (if necessary) and transfer to the Optionee the number of Option Shares with respect to which this Option has been so exercised, and shall deliver to the Optionee or have deposited in the Optionee’s brokerage account with the Administrator such Option Shares, at the Optionee’s election either electronically or represented by a certificate or certificates therefor, registered in the Optionee’s name.

 

6.             Termination of Employment.

    

        (a)    Except as otherwise provided in this Agreement, no Option may be granted or exercised unless the Optionee shall have remained in employment or service with the Company 

since the date of this Agreement.

 

                (b)   If the Optionee’s termination of employment or service is due to death, the Options then held by the Optionee shall automatically vest and become immediately exercisable in full and shall be exercisable by the Optionee’s designated beneficiary, or, if none, the person(s) to whom the Optionee’s rights under these Options are transferred by will or the laws of descent and distribution for one year following such termination of employment or service (but in no event beyond the term of the Options), and shall thereafter terminate.

 

    (c)            If the Optionee’s termination of employment or service is due to Disability (as defined herein), with respect to Options then held by the Optionee, the Optionee shall be treated as if his employment or service continued with the Company for the lesser of (i) five years or (ii) the remaining term of the Options solely for purposes of continued vesting and exercisability during such period (the “Disability Vesting Period”).  Upon expiration of the Disability Vesting Period, the Options shall automatically terminate; provided, that, if the Optionee should die during such period, the Options shall automatically vest and become immediately exercisable in full and shall be exercisable by the Optionee’s designated beneficiary, or, if none, the person(s) to whom the Optionee’s rights under the Options are transferred by will or the laws of descent and distribution for one year following such death (but in no event beyond the term of the Options), and shall thereafter terminate.  For purposes of this section, “Disability” shall mean (i) if the Optionee’s employment or service with the Company is subject to the terms of an employment or other service agreement between such Optionee and the Company, which agreement includes a definition of “Disability”, the term “Disability” shall have the meaning set forth in such agreement during the period that such agreement remains in effect; and (ii) in all other cases, the term “Disability” shall mean a physical or mental infirmity which impairs the Optionee’s ability to perform substantially his or her duties for a period of one hundred eighty (180) consecutive days.

 

 

  

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                (d)          If the Optionee’s termination of employment or service is due to Retirement (as defined herein), with respect to Options then held by the Optionee, the Optionee shall be treated as if his/her employment or service continued with the Company for the lesser of (i) five years or (ii) the remaining term of the Options solely for purposes of continued vesting and exercisability during such period (the “Retirement Vesting Period”).  Upon expiration of the Retirement Vesting Period, these Options shall automatically terminate; provided, that, if the Optionee should die during such period, these Options shall automatically vest and become immediately exercisable in full and shall be exercisable by the Optionee’s designated beneficiary, or, if none, the person(s) to whom such Optionee’s rights under the Options are transferred by will or the laws of descent and distribution for one year following such death (but in no event beyond the term of the Options), and shall thereafter terminate.  For purposes of this section, “Retirement” shall mean the Optionee’s resignation from the Company on or after the date on which the sum of his/her (i) full years of age (measured as of his/her last birthday preceding the date of termination of employment or service) and (ii) full years of service with the Company measured from his/her date of hire (or re-hire, if later), is equal at least seventy (70); provided, that, the Optionee must have attained at least the age of sixty (60) and completed at least five (5) full years of service with the Company prior to the date of his/her resignation.  Any disputes relating to whether the Optionee is eligible for Retirement under this Agreement, including, without limitation, his/her years’ of service, shall be settled by the Committee in its sole discretion.

 

                (e)           If the termination of the Optionee’s employment or service is for Cause (as defined herein), the Options shall terminate upon such termination of employment or service, regardless of whether the Options were then exercisable.  For purposes of this section, “Cause” shall mean the Optionee’s (i) intentional failure to perform reasonably assigned duties, (ii) dishonesty or willful misconduct in the performance of duties, (iii) involvement in a transaction in connection with the performance of duties to the Company which transaction is adverse to the interests of the Company and which is engaged in for personal profit or (iv) willful violation of any law, rule or regulation in connection with the performance of duties (other than traffic violations or similar offenses).

 

 

  

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(f)            If the termination of the Optionee’s employment or service is for any reason other than Cause (as defined herein), Option A shall automatically vest and become immediately exercisable in full.

 

                (g)   If the termination of the Optionee’s employment or service is for any other reason not covered by (b) to (e) above, the unvested portion of Options B, C and D, if any, shall terminate on the date of termination and the vested portion of those Options shall be exercisable for a period of three-months following such termination of employment or service (but in no event beyond the term of those Options), and shall thereafter terminate.  The Optionee’s status as an employee shall not be considered terminated in the case of a leave of absence agreed to in writing by the Company (including, but not limited to, military and sick leave); provided, that, such leave is for a period of not more than three-months or re-employment upon expiration of such leave is guaranteed by contract or statute.

 

(h)    Notwithstanding any other provision of this Agreement or the Plan to the contrary, including, without limitation, Sections 2 and 6 of this Agreement:

 

                (i)       If it is determined by the Committee that the Optionee engaged in (or is engaging in) any “Prohibited Act” (as defined below) where such Prohibited Act occurred or is occurring within the one (1) year period immediately following the exercise of any Option granted under this Agreement, the Optionee agrees that he/she will repay to the Company (or such third party as it directs) any net gain (after deduction of the Tax Liability) realized on the exercise of such Option (such gain to be valued as of the relevant exercise date(s)).  Such repayment obligation will be effective as of the date specified by the Committee.  Any repayment obligation must be satisfied in cash or, if permitted in the sole discretion of the Committee, in shares of Common Stock having a Fair Market Value equal to the gain realized upon exercise of the Option(s).  The Company is specifically authorized to off-set and deduct from any other payments, if any, including, without limitation, wages, salary or bonus, that it may owe the Optionee to secure the repayment obligations herein contained.  The determination of whether the Optionee has engaged in a Prohibited Act shall be determined by the Committee in good faith and in its sole discretion.  For the purposes of this Agreement, the term “Prohibited Activity” shall mean any activity that is harmful to the business or reputation of the Company (or any parent or subsidiary), including, without limitation, any “Competitive Activity” (as defined below in (h)(ii)) or conduct prejudicial to or in conflict with the Company (or any parent or subsidiary).

 

                (ii)  If it is determined by the Committee that the Optionee engaged (or is engaging in) any “Competitive Activity” (as defined below), then, upon such determination by the Committee, the Options shall be cancelled and cease to be exercisable (whether or not then vested).  The determination of whether the Optionee is engaging or has engaged in a Competitive Activity shall be determined by the Committee in good faith and in its sole discretion.  The provisions of Section 6(h)) shall have no effect following a Change of Control (as defined herein).  For purposes of this Agreement, the term “Competitive Activity” shall mean the Optionee directly or indirectly and whether alone or in conjunction with or on behalf of any other person and whether as a principal, shareholder, director, employee, agent, consultant, partner or otherwise:

 

 

  

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     (1)   at any time during the period of 9 months from the Effective Date within the Restricted Territory, take any steps preparatory to or be engaged, employed, interested or concerned in (A) any business that provides any Competing Business and/or (B) any Target Business Entity and/or (C) any firm, company or other entity directly or indirectly owning or controlling either a business that provides any Competing Business or a Target Business Entity;

 

                     (2)   at any time during the period of 9 months from the Effective Date within the Restricted Territory, acquire a substantial or controlling interest directly or by or through any nominee or nominees in any business providing any Competing Business, a Target Business Entity or in any firm, company or other entity owning or controlling a business that provides any Competing Business or a Target Business Entity;

 

                     (3)   at any time during the period of 9 months from the Effective Date solicit or induce or endeavour to solicit or induce any Key Person to leave the employ of the Company or any Relevant Group Company, whether or not such person would commit any breach of his or her own contract of employment or engagement by leaving the service of the Company or any Relevant Group Company; or

 

                     (4)   at any time during the period of 9 months from the Effective Date solicit or induce or endeavour to solicit or induce any person who is a Restricted Client or Prospective Client away from the Company or any Group Company or interfere with or endeavour to interfere with the Company’s or any Group Company’s relationship with any person who is a Restricted Client or Prospective Client provided always that nothing contained in this clause shall be deemed to prohibit the seeking or doing of business not in direct or indirect competition with the Restricted Business; or

 

             (5)   at any time during the period of 9 months from the Effective Date have business dealings directly or indirectly with any person who is a Restricted Client or Prospective Client provided always that nothing contained in this clause shall be deemed to prohibit the seeking or doing of business not in direct or indirect competition with the Restricted Business; or

 

 

  

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(6)   encourage, assist or procure any third party to do anything which, if done by him would be in breach of sub-paragraphs ‎i. to v. above,

 

but for the avoidance of doubt nothing in this section 6(h) will result in your forfeiting any Options as a result of working in the Restricted Period for a company or business which is not (i) a Competing Business; (ii) a Target Business Entity; or (iii) a firm, company or other entity which owns or controls a business that provides any Competing Business or a Target Business Entity and in which business you have a material involvement.

             

a.   For the purposes of this section 6, the following expressions shall have the following meanings:

 

i.   “Competing Business” shall mean any products or services which are the same as or materially similar to and competitive with any Restricted Business to include without limitation the businesses of Stroer, JCD, News Outdoor, Titan and CBS;

 

ii.   “Effective Date” means the date on which the Optionee’s employment terminates (the “Termination Date”) provided always that if no duties have been assigned to him or he has carried out duties other than his normal duties or has been excluded from the Company’s or any Group Company’s premises immediately preceding the Termination Date, it means the last date on which he carried out his normal duties;

 

iii.    “Key Person” shall mean any person who on the Effective Date is a director or officer or manager or executive or of the same grade to the Optionee employed or engaged by the Company or any Relevant Group Company or any consultant working for the Company or any Relevant Group Company as a director or officer or manager or executive or in a similar capacity (or any person who would have been so employed by or working for the Company or any Relevant Group Company on the Effective Date but for the Optionee’s breach of his obligations under this Agreement or any employment agreement and/or implied by law) with whom he worked or had material dealings or for whose work he was responsible or managed in the course of his employment at any time during the Relevant Period;

 

iv.   “Prospective Client” shall mean any person who at any time during the Relevant Period was a prospective client or prospective customer of the Company or any Group Company and with whom the Optionee had a material involvement during the course of his employment at any time during the Relevant Period;

 

 

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v.    “Relevant Group Company” shall mean any Group Company (other than the Company) for which the Optionee has performed services or for which the Optionee has had operational or management responsibility or has provided services at any time during the Relevant Period;

 

vi.    “Relevant Period” shall mean the period of 12 months immediately before the Effective Date;

 

vii. “Restricted Business” shall mean the business of owning, operating and developing advertising structures both static and moveable, indoor and outdoor including advertising panels designed to display advertisements and any other products or services provided by the Company or any Relevant Group Company at any time during the Relevant Period with which the Optionee had a material involvement during the course of his employment at any time during the Relevant Period;

 

viii. “Restricted Client” shall mean any person who at any time during the Relevant Period was a client or customer of the Company or any Group Company and with whom the Optionee had a material involvement during the course of his employment at any time during the Relevant Period;

 

ix. “Restricted Territory” shall mean within the United Kingdom and any other country in the world where on the Effective Date the Company or any Relevant Group Company was engaged in the research into, development, manufacture, distribution, sale or supply or otherwise dealt in any Restricted Business;

 

x. “Target Business Entity” means any business howsoever constituted (whether or not providing Competing Business) which was at the Effective Date or at any time during the Relevant Period a business which the Company or any Relevant Group Company had entered into negotiations with, had approached or had identified as (i) a potential target with a view to its acquisition by the Company or any Relevant Group Company and/or (ii) a potential party to any joint venture with the Company or any Relevant Group Company, in either case where such approach or negotiations or identification were known to a material degree by the Optionee during the Relevant Period.

 

  

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Each of the forfeiture provisions in this section 6(h) is intended to be separate and severable and in the event that any of such restrictions shall be adjudged to be void or ineffective for whatever reason but would be adjudged to be valid and effective if part of the wording or range of services or products were reduced in scope or deleted, the said restrictions shall apply with such modifications as may be necessary to make them valid and effective.

 

              (i) The term “Company” as used in this Agreement with reference to the employment or service of the Optionee shall include the Company and its parent and subsidiaries, as 

appropriate.

 

7.   Change in Control.

 

      (a)   Upon the occurrence of a Change in Control (as defined herein), the Options already granted in accordance with Section 1 herein shall become immediately vested and exercisable in full.  For the purposes hereof, the term “Change in Control” shall mean a transaction or series of transactions which constitutes an “Exchange Transaction” within the meaning of the Plan or such other event involving a change in ownership or control of the business or assets of the Company as the Board, acting in its discretion, may determine.  For the avoidance of doubt, the determination of whether a transaction or series of transactions constitutes an Exchange Transaction within the meaning of the Plan shall be determined by the Board, acting in its sole discretion.

 

      (b)   In the event that the Company decides to divest Clear Channel Outdoor International prior to 31 August 2012 the Options shall become immediately vested and the Optionee will have the option to exercise the Options immediately, hold the Options for future exercise or exchange such Options for a guaranteed minimum value of US$1.2 million (to be converted from US dollars using an exchange rate of US$1.49:£1).

 

8.   Rights as a Stockholder.  No shares of Common Stock shall be issued in respect of the exercise of the Options until payment of the exercise price and the applicable Tax Liability have been satisfied or provided for to the satisfaction of the Company, and the Optionee shall have no rights as a stockholder with respect to any shares covered by the Options until such shares are duly and validly issued by the Company to or on behalf of the Optionee.

 

9.   Non-Transferability.   The Options are not assignable or transferable except upon the Optionee’s death to a beneficiary designated by the Optionee in a manner prescribed or approved for this purpose by the Committee or, if no designated beneficiary shall survive the Optionee, pursuant to the Optionee’s will or by the laws of descent and distribution.  During an Optionee’s lifetime, the Options may be exercised only by the Optionee or the Optionee’s guardian or legal representative.  Any purported assignment, charge, pledge, disposal of or dealing with an Option shall cause the Option to lapse forthwith.

 

 

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10.   Limitation of Rights.   Nothing contained in this Agreement shall confer upon the Optionee any right with respect to the continuation of his employment or service with the Company, or interfere in any way with the right of the Company at any time to terminate such employment or other service (including dismissal by his employer in breach of the terms of his employment contract) or to increase or decrease, or otherwise adjust, the compensation and/or other terms and conditions of the Optionee’s employment or other service.

 

11.   Restrictions on Transfer.    The Optionee agrees, by acceptance of the Options, that, upon issuance of any shares hereunder, that, unless such shares are then registered under applicable federal and state securities laws, (i) acquisition of such shares will be for investment and not with a view to the distribution thereof, and (ii) the Company may require an investment letter from the Optionee in such form as may be recommended by Company counsel. The Company shall in no event be obliged to register any securities pursuant to the Securities Act of 1933 (as now in effect or as hereafter amended) or to take any other affirmative action in order to cause the exercise of the Options or the issuance or transfer of shares pursuant thereto to comply with any law or regulation of any governmental authority.

 

12.   Notice.   Any notice to the Company provided for in this Agreement shall be addressed to it in care of its Secretary at its executive offices at Clear Channel Outdoor Holdings, Inc., 200 East Basse Road, San Antonio, Texas 78209-8328, and any notice to the Optionee shall be addressed to the Optionee at the current address shown on the payroll records of the Company. Any notice shall be deemed to be duly given if and when properly addressed and posted by registered or certified mail, postage prepaid.

 

13.   Incorporation of Plan by Reference.   This Option is granted pursuant to the terms of the Plan, the terms of which are incorporated herein by reference, and this Option shall in all respects be interpreted in accordance with the Plan.  The Committee shall interpret and construe the Plan and this Agreement and its interpretations and determinations shall be conclusive and binding on the parties hereto and any other person claiming an interest hereunder, with respect to any issue arising hereunder or thereunder. In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Agreement, the Plan shall govern and control.

 

14.   Governing Law.   This Agreement and the rights of all persons claiming under this Agreement shall be governed by the laws of State of Delaware, without giving effect to conflicts of laws principles thereof.

 

15.   Tax Status of Option.   This Option is not intended to be an incentive stock option within the meaning of Section 422 of the Code.

 

16.   Exchange rate.   Where any amount is to be converted into or from US dollars for the purposes of the Plan (including any “Tax Liability” but excluding, for the avoidance of doubt, any calculation under section 7(b)), it shall be converted using the applicable spot rate quoted in The Wall Street Journal for that day (or such other source as the Committee deems reliable).

 

 

  

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17.   Miscellaneous.   This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and may not be modified other than by written instrument executed by the parties.

 

  

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IN WITNESS WHEREOF, the Company has caused this Amended and Restated Option Agreement to be executed under its corporate seal by its duly authorized officer.  This Amended and Restated Option Agreement shall take effect as a sealed instrument.

 

 

 

	 	Clear Channel Outdoor Holdings, Inc.	 
	 	 	 	 
	
 

	
By: 

	 	 
	 	 	Name:	 
	 	 	Title:	 
	 	 	 	 

 

 

 

 

Dated:

Acknowledged and Agreed

__________________________

Name:  William Eccleshare

Address of Principal Residence:

__________________________

__________________________

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