Document:

exv10w1

 

Exhibit 10.1

IRIDEX CORPORATION

1998 STOCK PLAN

(As amended June 19, 2007)

     1. Purposes of the Plan. The purposes of this Stock Plan are:

	 	•	 	to attract and retain the best available personnel for positions of
substantial responsibility,
	 
	 	•	 	to provide additional incentive to Employees, Directors and Consultants, and
	 
	 	•	 	to promote the success of the Company’s business.

     The Plan permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Shares and Performance
Units, as the Administrator may determine.

     2. Definitions. As used herein, the following definitions shall apply:

          
(a) “Administrator” means the Board or any of its Committees as shall be administering
the Plan, in accordance with Section 4 of the Plan.

          
(b) “Affiliate” means any corporation or any other entity (including, but not limited
to, partnerships and joint ventures) controlling, controlled by, or under common control with the
Company.

          
(c) “Applicable Laws” means the requirements relating to the administration of
equity-based awards under U.S. state corporate laws, U.S. federal and state securities laws, the
Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the
applicable laws of any foreign country or jurisdiction where Awards are, or will be, granted under
the Plan.

          
(d) “Award” means, individually or collectively, a grant under the Plan of Options,
Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Units and
Performance Shares as the Administrator may determine.

          
(e) “Award Agreement” means the written or electronic agreement setting forth the
terms and provisions applicable to each Award granted under the Plan, which shall include an Option
Agreement. The Award Agreement is subject to the terms and conditions of the Plan.

          
(f) “Board” means the Board of Directors of the Company.

          
(g) “Cash Position” means as to any Performance Period, the Company’s level of cash,
cash equivalents, available-for-sales securities, and the long term portion of available-for-sales
securities.

 

 

          
(h) “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a
section of the Code herein will be a reference to any successor or amended section of the Code.

          
(i) “Committee” means a committee of Directors or of other individuals satisfying
Applicable Laws appointed by the Board in accordance with Section 4 hereof.

          
(j) “Common Stock” means the common stock of the Company.

          
(k) “Company” means IRIDEX Corporation, a Delaware corporation, or any successor
thereto.

          
(l) “Consultant” means any person, including an advisor, engaged by the Company or its
Affiliate to render services to such entity.

          
(m) “Determination Date” means the latest possible date that will not jeopardize the
qualification of an Award granted under the Plan as “performance-based compensation” under Section
162(m) of the Code.

          
(n) “Director” means a member of the Board.

          
(o) “Disability” means total and permanent disability as defined in Section 22(e)(3)
of the Code, provided that in the case of Awards other than Incentive Stock Options, the
Administrator in its discretion may determine whether a permanent and total disability exists in
accordance with uniform and non-discriminatory standards adopted by the Administrator from time to
time.

          
(p) “Earnings Per Share” means as to any Performance Period, the Company’s or a
business unit’s Net Income, divided by a weighted average number of Common Stock outstanding and
dilutive common equivalent Shares deemed outstanding.

          
(q) “Employee” means any person, including Officers and Directors, employed by the
Company or its Affiliates. Neither service as a Director nor payment of a director’s fee by the
Company will be sufficient to constitute “employment” by the Company.

          
(r) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

          
(s) “Fair Market Value” means, as of any date, the value of Common Stock as the
Administrator may determine in good faith by reference to the price of such stock on any
established stock exchange or a national market system on the day of determination if the Common
Stock is so listed on any established stock exchange or a national market system. If the Common
Stock is not listed on any established stock exchange or a national market system, the value of the
Common Stock as the Administrator may determine in good faith.

          
(t) “Fiscal Year” means the fiscal year of the Company.

          
(u) “Incentive Stock Option” means an Option that by its terms qualifies and is
otherwise intended to qualify as an incentive stock option within the meaning of Section 422 of the
Code and the regulations promulgated thereunder.

2

 

          
(v) “Individual Objectives” means as to a Participant for any Performance Period, the
objective and measurable goals set by a “management by objectives” process and approved by the
Administrator (in its discretion).

          
(w) “Net Income” means as to any Performance Period, the Company’s or a business
unit’s income after taxes.

          
(x) “Nonstatutory Stock Option” means an Option that by its terms does not qualify or
is not intended to qualify as an Incentive Stock Option.

          
(y) “Officer” means a person who is an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

          
(z) “Operating Cash Flow” means as to any Performance Period, the Company’s or a
business unit’s sum of Net Income plus depreciation and amortization plus changes in working
capital comprised of accounts receivable, inventories, other current assets, trade accounts
payable, accrued expenses, product warranty, advance payments from customers and long-term accrued
expenses.

          
(aa) “Operating Income” means as to any Performance Period, the Company’s or a
business unit’s income from operations but excluding any unusual items or non-operating or non-cash
related expenses.

          
(bb) “Option” means a stock option granted pursuant to the Plan.

          
(cc) “Option Agreement” means an agreement between the Company and a Participant
evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject
to the terms and conditions of the Plan.

          
(dd) “Optioned Stock” means the Common Stock subject to an Award

          
(ee) “Parent” means a “parent corporation,” whether now or hereafter existing, as
defined in Section 424(e) of the Code.

          
(ff) “Participant” means the holder of an outstanding Award, which shall include an
Optionee.

          
(gg) “Performance Goals” means the goal(s) (or combined goal(s)) determined by the
Administrator (in its discretion) to be applicable to a Participant with respect to an Award. As
determined by the Administrator, the Performance Goals applicable to an Award may provide for a
targeted level or levels of achievement using one or more of the following measures: (a) Cash
Position, (b) Earnings Per Share, (c) Individual Objectives, (d) Net Income, (e) Operating Cash
Flow, (f) Operating Income, (g) Return on Assets, (h) Return on Equity, (i) Return on Sales, (j)
Revenue, and (k) Total Stockholder Return. The Performance Goals may differ from Participant to
Participant and from Award to Award. Prior to the Determination Date, the Administrator shall
determine whether any significant element(s) shall be included in or excluded from the calculation
of any Performance Goal with respect to any Participant. For example (but not by way of
limitation), the Administrator may determine that the measures for one or more Performance Goals
shall be based upon the Company’s pro-forma results and/or results in accordance with generally
accepted accounting principles.

3

 

          
(hh) “Performance Period” means any Fiscal Year or such other period as determined by
the Administrator in its sole discretion.

          
(ii) “Performance Share” means an Award denominated in Shares which may be earned in
whole or in part upon attainment of Performance Goals or other vesting criteria as the
Administrator may determine pursuant to Section 10.

          
(jj) “Performance Unit” means an Award which may be earned in whole or in part upon
attainment of Performance Goals or other vesting criteria as the Administrator may determine and
which may be settled for cash, Shares or other securities or a combination of the foregoing
pursuant to Section 10.

          
(kk) “Plan” means this 1998 Stock Plan, as amended and restated.

          
(ll) “Restricted Stock” means Shares issued pursuant to a Restricted Stock award under
Section 8 of the Plan, or issued pursuant to the early exercise of an Option.

          
(mm) “Restricted Stock Unit” means a bookkeeping entry representing an amount equal to
the Fair Market Value of one Share, granted pursuant to Section 9. Each Restricted Stock Unit
represents an unfunded and unsecured obligation of the Company.

          
(nn) “Return on Assets” means as to any Performance Period, the percentage equal to
the Company’s or a business unit’s Operating Income, divided by average net Company or business
unit, as applicable, assets.

          
(oo) “Return on Equity” means as to any Performance Period, the percentage equal to
the Company’s Net Income divided by average stockholder’s equity.

          
(pp) “Return on Sales” means as to any Performance Period, the percentage equal to the
Company’s or a business unit’s Operating Income, divided by the Company’s or the business unit’s,
as applicable, revenue.

          
(qq) “Revenue” means as to any Performance Period, the Company’s or business unit’s
net sales.

          
(rr) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3,
as in effect when discretion is being exercised with respect to the Plan.

          
(ss) “Section 16(b)” means Section 16(b) of the Exchange Act.

          
(tt) “Service Provider” means an Employee, Director or Consultant.

          
(uu) “Share” means a share of the Common Stock, as adjusted in accordance with Section
13 of the Plan.

          
(vv) “Stock Appreciation Right” means an Award, granted alone or in connection with an
Option, that pursuant to Section 7 is designated as a Stock Appreciation Right.

          
(ww) “Subsidiary” means a “subsidiary corporation”, whether now
or hereafter existing, as defined in Section 424(f) of the Code.

4

 

          
(xx) “Total Stockholder Return” means as to any Performance Period, the total return
(change in Share price plus reinvestment of any dividends) of a Share.

     3. Stock Subject to the Plan.

          
(a) Stock Subject to the Plan. Subject to the provisions of Section 13 of the Plan,
the maximum aggregate number of Shares which may be optioned and sold under the Plan is two million
one hundred and fifty thousand (2,150,000) Shares. The Shares may be authorized, but unissued, or
reacquired Common Stock.

          
(b) Full Value Awards. Any Shares subject to Options or Stock Appreciation Rights
will be counted against the numerical limits of this Section 3 as one Share for every Share subject
thereto. Any Shares subject to Awards of Restricted Stock, Restricted Stock Units, Performance
Shares or Performance Units with a per share or unit purchase price lower than 100% of Fair Market
Value on the date of grant will be counted against the numerical limits of this Section 3 as two
(2) Shares for every one Share subject thereto. To the extent that a Share that was subject to an
Award that counted as two (2) Shares against the Plan reserve pursuant to the preceding sentence is
recycled back into the Plan under the next paragraph of this Section 3, the Plan will be credited
with two (2) Shares.

          
(c) Lapsed Awards. If an Award expires or becomes unexercisable without having been
exercised in full, or, with respect to Restricted Stock, Restricted Stock Units, Performance Shares
or Performance Units, is forfeited to or repurchased by the Company, the unpurchased Shares (or for
Awards other than Options and Stock Appreciation Rights, the forfeited or repurchased shares) which
were subject thereto will become available for future grant or sale under the Plan (unless the Plan
has terminated). With respect to Stock Appreciation Rights, Shares actually issued pursuant to a
Stock Appreciation Right as well as the Shares that represent payment of the exercise price will
cease to be available under the Plan. Shares that have actually been issued under the Plan under
any Award will not be returned to the Plan and will not become available for future distribution
under the Plan; provided, however, that if Shares subject to Awards of Restricted Stock, Restricted
Stock Units, Performance Shares or Performance Units are repurchased by the Company or are
forfeited to the Company, such Shares will become available for future grant under the Plan.
Shares used to pay the exercise price of an Option will not become available for future grant or
sale under the Plan. Shares used to satisfy tax withholding obligations will not become available
for future grant or sale under the Plan. To the extent an Award under the Plan is paid out in cash
rather than Shares, such cash payment will not reduce the number of Shares available for issuance
under the Plan. Notwithstanding the foregoing and, subject to adjustment provided in Section 13,
the maximum number of Shares that may be issued upon the exercise of Incentive Stock Options will
equal the aggregate Share number stated in Section 3(a), plus, to the extent allowable under
Section 422 of the Code, any Shares that become available for issuance under the Plan under this
Section 3(c).

          
(d) Share Reserve. The Company, during the term of this Plan, will at all times
reserve and keep available such number of Shares as will be sufficient to satisfy the requirements
of the Plan.

     4. Administration of the Plan.

          
(a) Procedure.

5

 

               
(i) Multiple Administrative Bodies. The Plan may be administered by different
Committees with respect to different groups of Service Providers.

               
(ii) Section 162(m). To the extent that the Administrator determines it to be
desirable to qualify Options granted hereunder as “performance-based compensation” within the
meaning of Section 162(m) of the Code, the Plan shall be administered by a Committee of two or more
“outside directors” within the meaning of Section 162(m) of the Code.

               
(iii) Rule 16b-3. To the extent desirable to qualify transactions hereunder as exempt
under Rule 16b-3, the transactions contemplated hereunder shall be structured to satisfy the
requirements for exemption under Rule 16b-3.

               
(iv) Other Administration. Other than as provided above, the Plan shall be
administered by (A) the Board or (B) a Committee, which committee shall be constituted to satisfy
Applicable Laws.

          
(b) Powers of the Administrator. Subject to the provisions of the Plan, and in the
case of a Committee, subject to the specific duties delegated by the Board to such Committee, the
Administrator shall have the authority, in its discretion:

               
(i) to select the Service Providers to whom Awards may be granted hereunder;

               
(ii) to determine the terms and conditions, not inconsistent with the terms of the Plan, of
any Award granted hereunder;

               
(iii) to construe and interpret the terms of the Plan and Awards granted pursuant to the Plan;

               
(iv) to prescribe, amend and rescind rules and regulations relating to the Plan, including
rules and regulations relating to sub-plans established for the purpose of satisfying applicable
foreign laws;

               
(v) to modify or amend each Award (subject to Section 21(c) of the Plan) including, without
limitation, the discretionary authority to extend the post-termination exercisability period of
Awards longer than is otherwise provided for in the Plan. Notwithstanding the previous sentence,
the Administrator may not modify or amend an Option or Stock Appreciation Right to reduce the
exercise price of such Option or Stock Appreciation Right after it has been granted (except for
adjustments made pursuant to Section 16) nor may the Administrator cancel any outstanding Option or
Stock Appreciation Right and replace it with a new Option or Stock Appreciation Right with a lower
exercise price, unless, in either case, such action is approved by the Company’s stockholders;

               
(vi) to authorize any person to execute on behalf of the Company any instrument required to
effect the grant of an Award previously granted by the Administrator;

               
(vii) to allow a Participant to defer the receipt of the payment of cash or the delivery of
Shares that would otherwise be due to such Participant under an Award pursuant to such procedures
as the Administrator may determine; and

6

 

               
(viii) to make all other determinations deemed necessary or advisable for administering the
Plan.

          
(c) Effect of Administrator’s Decision. The Administrator’s decisions, determinations
and interpretations shall be final and binding on all Participants and any other holders of Awards.

     5. Eligibility. Nonstatutory Stock Options, Stock Appreciation Rights, Restricted
Stock, Restricted Stock Units, Performance Shares and Performance Units as the Administrator
determines may be granted to Service Providers. Incentive Stock Options may be granted only to
Employees of the Company or any Parent or Subsidiary of the Company.

     6. Options.

          
(a) Limitations.

               
(i) Each Option shall be designated in the Award Agreement as either an Incentive Stock Option
or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the
aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Participant during any calendar year (under all plans of the
Company and any Parent or Subsidiary) exceeds $100,000, such Options shall be treated as
Nonstatutory Stock Options. For purposes of this Section 6(a), Incentive Stock Options shall be
taken into account in the order in which they were granted. The Fair Market Value of the Shares
shall be determined as of the time the Option with respect to such Shares is granted.

               
(ii) The following limitations shall apply to grants of Options:

                    
(1) No Service Provider shall be granted, in any Fiscal Year, Options to purchase more than
200,000 Shares.

                    
(2) In connection with his or her initial service, a Service Provider may be granted Options
to purchase up to an additional 400,000 Shares which shall not count against the limit set forth in
subsection (1) above.

                    
(3) The foregoing limitations shall be adjusted proportionately in connection with any change
in the Company’s capitalization as described in Section 13.

                    
(4) If an Option is cancelled in the same fiscal year of the Company in which it was granted
(other than in connection with a transaction described in Section 13), the cancelled Option will be
counted against the limits set forth in subsections (1) and (2) above. For this purpose, if the
exercise price of an Option is reduced, the transaction will be treated as a cancellation of the
Option and the grant of a new Option.

          
(b) Term of Option. The term of each Option shall be stated in the Award Agreement and
shall be seven (7) years from the date of grant or such shorter term as may be provided by the
Administrator; provided, however, that in the case of an Incentive Stock Option granted to a
Participant who, at the time the Incentive Stock Option is granted, owns stock representing more
than ten percent (10%) of the total combined voting power of all classes of stock of the Company or
any Parent or Subsidiary, the term of the Incentive Stock Option shall be five (5) years from the
date of grant or such shorter term as may be provided by the Administrator.

7

 

          
(c) Option Exercise Price and Consideration.

               
(i) Exercise Price. The per share exercise price for the Shares to be issued pursuant
to exercise of an Option shall be determined by the Administrator, subject to the following:

                    
(1) In the case of an Incentive Stock Option

                         
a) granted to an Employee who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the voting power of all classes of stock of the Company
or any Parent or Subsidiary, the per Share exercise price shall be no less than 110% of the Fair
Market Value per Share on the date of grant.

                         
b) granted to any Employee other than an Employee described in paragraph (A) immediately
above, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share
on the date of grant.

                    
(2) In the case of a Nonstatutory Stock Option, the per Share exercise price will be
determined by the Administrator, but will be no less than 100% of the Fair Market Value per Share
on the date of grant.

                    
(3) Notwithstanding the foregoing, Options may be granted with a per Share exercise price of
less than 100% of the Fair Market Value per Share on the date of grant pursuant to a transaction
described in, and in a manner consistent with, Section 424(a) of the Code.

               
(ii) Waiting Period and Exercise Dates. At the time an Option is granted, the Administrator
shall fix the period within which the Option may be exercised and shall determine any conditions
which must be satisfied before the Option may be exercised.

               
(iii) Form of Consideration. The Administrator will determine the acceptable form(s) of
consideration for exercising an Option, including the method of payment, to the extent permitted by
Applicable Laws.

          
(d) Exercise of Option.

               
(i) Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder
shall be exercisable according to the terms of the Plan and at such times and under such conditions
as determined by the Administrator and set forth in the Award Agreement. An Option may not be
exercised for a fraction of a Share.

               
An Option shall be deemed exercised when the Company receives: (i) written or electronic
notice of exercise (in accordance with the Award Agreement) from the person entitled to exercise
the Option, and (ii) full payment for the Shares with respect to which the Option is exercised
together with any applicable withholding taxes. Full payment may consist of any consideration and
method of payment authorized by the Administrator and permitted by the Award Agreement and the
Plan. Shares issued upon exercise of an Option shall be issued in the name of the Participant or,
if requested by the Participant, in the name of the Participant and his or her spouse. Until the
Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), no right to vote or receive dividends or any other
rights as a stockholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option. The Company shall issue (or cause to be issued) such Shares promptly after
the Option

8

 

is exercised. No adjustment will be made for a dividend or other right for which the record
date is prior to the date the Shares are issued, except as provided in Section 13 of the Plan.

               
Exercising an Option in any manner shall decrease the number of Shares thereafter available,
both for purposes of the Plan and for sale under the Option, by the number of Shares as to which
the Option is exercised.

               
(ii) Termination of Relationship as a Service Provider. If an Participant ceases to be
a Service Provider, other than upon the Participant’s death or Disability, the Participant may
exercise his or her Option within such period of time as is specified in the Award Agreement to the
extent that the Option is vested on the date of termination (but in no event later than the
expiration of the term of such Option as set forth in the Award Agreement). In the absence of a
specified time in the Award Agreement, the Option shall remain exercisable for three (3) months
following the Participant’s termination. If, on the date of termination, the Participant is not
vested as to his or her entire Option, the Shares covered by the unvested portion of the Option
shall revert to the Plan. If, after termination, the Participant does not exercise his or her
Option within the time specified by the Administrator, the Option shall terminate, and the Shares
covered by such Option shall revert to the Plan.

               
(iii) Disability of Participant. If an Participant ceases to be a Service Provider as
a result of the Participant’s Disability, the Participant may exercise his or her Option within
such period of time as is specified in the Award Agreement to the extent the Option is vested on
the date of termination (but in no event later than the expiration of the term of such Option as
set forth in the Award Agreement). In the absence of a specified time in the Award Agreement, the
Option shall remain exercisable for twelve (12) months following the Participant’s termination. If,
on the date of termination, the Participant is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option shall revert to the Plan. If, after
termination, the Participant does not exercise his or her Option within the time specified herein,
the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

               
(iv) Death of Participant. If an Participant dies while a Service Provider, the Option
may be exercised within such period of time as is specified in the Award Agreement (but in no event
later than the expiration of the term of such Option as set forth in the Award Agreement), by the
Participant’s estate or by a person who acquires the right to exercise the Option by bequest or
inheritance, but only to the extent that the Option is vested on the date of death. In the absence
of a specified time in the Award Agreement, the Option shall remain exercisable for twelve (12)
months following the Participant’s termination. If, at the time of death, the Participant is not
vested as to his or her entire Option, the Shares covered by the unvested portion of the Option
shall immediately revert to the Plan. The Option may be exercised by the executor or administrator
of the Participant’s estate or, if none, by the person(s) entitled to exercise the Option under the
Participant’s will or the laws of descent or distribution. If the Option is not so exercised within
the time specified herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

9

 

     7. Stock Appreciation Rights.

          
(a) Grant of Stock Appreciation Rights. Subject to the terms and conditions of the
Plan, a Stock Appreciation Right may be granted to Service Providers at any time and from time to
time as will be determined by the Administrator, in its sole discretion.

          
(b) Number of Shares. The Administrator will have complete discretion to determine
the number of Stock Appreciation Rights granted to any Participant, provided that during any Fiscal
Year, no Participant will be granted Stock Appreciation Rights covering more than 200,000 Shares.
Notwithstanding the foregoing limitation, in connection with a Participant’s initial service as an
Employee, an Employee may be granted Stock Appreciation Rights covering up to an additional 400,000
Shares.

          
(c) Exercise Price and Other Terms. The Administrator, subject to the provisions of
the Plan, will have complete discretion to determine the terms and conditions of Stock Appreciation
Rights granted under the Plan, provided, however, that the exercise price will be not less than one
hundred percent (100%) of the Fair Market Value of a Share on the date of grant.

          
(d) Stock Appreciation Right Agreement. Each Stock Appreciation Right grant will be
evidenced by an Award Agreement that will specify the exercise price, the term of the Stock
Appreciation Right, the conditions of exercise, and such other terms and conditions as the
Administrator, in its sole discretion, will determine.

          
(e) Expiration of Stock Appreciation Rights. A Stock Appreciation Right granted under
the Plan will expire upon the date determined by the Administrator, in its sole discretion, and set
forth in the Award Agreement. Notwithstanding the foregoing, the rules of Section 6(d) also will
apply to Stock Appreciation Rights.

          
(f) Payment of Stock Appreciation Right Amount. Upon exercise of a Stock Appreciation
Right, a Participant will be entitled to receive payment from the Company in an amount determined
by multiplying:

               
(i) The difference between the Fair Market Value of a Share on the date of exercise over the
exercise price; times

               
(ii) The number of Shares with respect to which the Stock Appreciation Right is exercised.

At the discretion of the Administrator, the payment upon Stock Appreciation Right exercise may be
in cash, in Shares of equivalent value, or in some combination thereof.

     8. Restricted Stock.

          
(a) Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the
Administrator, at any time and from time to time, may grant Shares of Restricted Stock to Service
Providers in such amounts as the Administrator, in its sole discretion, will determine.

          
(b) Restricted Stock Agreement. Each Award of Restricted Stock will be evidenced by
an Award Agreement that will specify the number of Shares granted, and such other

10

 

terms and conditions as the Administrator, in its sole discretion, will determine.
Notwithstanding the foregoing, during any Fiscal Year no Participant will receive more than an
aggregate of 150,000 Shares of Restricted Stock; provided, however, that in connection with a
Participant’s initial service as an Employee, an Employee may be granted an aggregate of up to an
additional 150,000 Shares of Restricted Stock. Unless the Administrator determines otherwise,
Shares of Restricted Stock will be held by the Company as escrow agent until the restrictions on
such Shares have lapsed.

          
(c) Transferability. Except as provided in this Section 8, Shares of Restricted Stock
may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the
Shares have vested and are no longer subject to a substantial risk of forfeiture.

          
(d) Other Restrictions. The Administrator, in its sole discretion, may impose such
other restrictions on Shares of Restricted Stock as it may deem advisable or appropriate.

          
(e) Removal of Restrictions. Except as otherwise provided in this Section 8, Shares
of Restricted Stock covered by each Restricted Stock grant made under the Plan will be released
from escrow as soon as practicable after the last day the Shares have vested and are no longer
subject to a substantial risk of forfeiture. The restrictions will lapse at a rate determined by
the Administrator. The Administrator, in its discretion, may accelerate the time at which any
restrictions will lapse or be removed.

          
(f) Voting Rights. During the period during which Shares of Restricted Stock are
unvested and subject to a substantial risk of forfeiture, Service Providers holding such Shares may
exercise full voting rights with respect to those Shares, unless the Administrator determines
otherwise.

          
(g) Dividends and Other Distributions. During the period during which Shares of
Restricted Stock are unvested and subject to substantial risk of forfeiture, Service Providers
holding such Shares will be entitled to receive all dividends and other distributions paid with
respect to such Shares unless otherwise Administrator provides otherwise. If any such dividends or
distributions are paid in Shares, the Shares will be subject to the same restrictions on
transferability and forfeitability as the Shares of Restricted Stock with respect to which they
were paid.

          
(h) Return of Restricted Stock to Company. On the date set forth in the Award
Agreement, the Restricted Stock for which restrictions have not lapsed will revert to the Company
and again will become available for grant under the Plan.

     9. Restricted Stock Units.

          
(a) Grant. Restricted Stock Units may be granted at any time and from time to time as
determined by the Administrator. Each Restricted Stock Unit grant shall be evidenced by an Award
Agreement that shall specify such other terms and conditions as the Administrator, in its sole
discretion, shall determine, including all terms, conditions, and restrictions related to the
grant, the number of Restricted Stock Units and the form of payout, which, subject to Section 9(d),
may be left to the discretion of the Administrator. Notwithstanding the anything to the contrary
in this subsection (a), during any Fiscal Year, no Participant will receive more than an aggregate
of 150,000 Restricted Stock Units; provided, however, that in connection with a Participant’s
initial service as an Employee, an Employee may be granted an aggregate of up to an additional
150,000 Restricted Stock Units.

11

 

          
(b) Vesting Criteria and Other Terms. The Administrator shall set vesting criteria in
its discretion, which, depending on the extent to which the criteria are met, will determine the
number of Restricted Stock Units that will be paid out to the Participant. The Administrator may
set vesting criteria based upon the achievement of Company-wide, business unit, or individual goals
(including, but not limited to, continued employment or service), or any other basis determined by
the Administrator in its discretion.

          
(c) Earning Restricted Stock Units. Upon meeting the applicable vesting criteria, the
Participant shall be entitled to receive a payout as specified in the Restricted Stock Unit Award
Agreement. Notwithstanding the foregoing, at any time after the grant of Restricted Stock Units,
the Administrator, in its sole discretion, may reduce or waive any vesting criteria that must be
met to receive a payout.

          
(d) Form and Timing of Payment. Payment of earned Restricted Stock Units shall be
made as soon as practicable after the date(s) set forth in the Award Agreement. The Administrator,
in its sole discretion, may pay earned Restricted Stock Units in cash, Shares, or a combination
thereof. Shares represented by Restricted Stock Units that are fully paid in cash again shall be
available for grant under the Plan.

          
(e) Cancellation. On the date set forth in the Award Agreement, all unearned
Restricted Stock Units shall be forfeited to the Company.

     10. Performance Units and Performance Shares.

          
(a) Grant of Performance Units/Shares. Performance Units and Performance Shares may
be granted to Service Providers at any time and from time to time, as will be determined by the
Administrator, in its sole discretion. The Administrator will have complete discretion in
determining the number of Performance Units/Shares granted to each Participant provided that during
any Fiscal Year, (a) no Participant will receive Performance Units having an initial value greater
than $1,000,000, and (b) no Participant will receive more than 150,000 Performance Shares.
Notwithstanding the foregoing limitation, in connection with a Participant’s initial service as an
Employee, an Employee may be granted up to an additional 150,000 Performance Shares.

          
(b) Value of Performance Units/Shares. Each Performance Unit will have an initial
value that is established by the Administrator on or before the date of grant. Each Performance
Share will have an initial value equal to the Fair Market Value of a Share on the date of grant.

          
(c) Performance Objectives and Other Terms. The Administrator will set performance
objectives or other vesting provisions (including, without limitation, continued status as a
Service Provider) in its discretion which, depending on the extent to which they are met, will
determine the number or value of Performance Units/Shares that will be paid out to the Participant.
Each Award of Performance Units/Shares will be evidenced by an Award Agreement that will specify
the Performance Period, and such other terms and conditions as the Administrator, in its sole
discretion, will determine.

          
(d) Earning of Performance Units/Shares. After the applicable Performance Period has
ended, the holder of Performance Units/Shares will be entitled to receive a payout of the number of
Performance Units/Shares earned by the Participant over the Performance Period, to be

12

 

determined as a function of the extent to which the corresponding performance objectives or
other vesting provisions have been achieved. After the grant of a Performance Unit/Share, the
Administrator, in its sole discretion, may reduce or waive any performance objectives or other
vesting provisions for such Performance Unit/Share.

          
(e) Form and Timing of Payment of Performance Units/Shares. Payment of earned
Performance Units/Shares will be made as soon as practicable after the expiration of the applicable
Performance Period. The Administrator, in its sole discretion, may pay earned Performance
Units/Shares in the form of cash, in Shares (which have an aggregate Fair Market Value equal to the
value of the earned Performance Units/Shares at the close of the applicable Performance Period) or
in a combination thereof.

          
(f) Cancellation of Performance Units/Shares. On the date set forth in the Award
Agreement, all unearned or unvested Performance Units/Shares will be forfeited to the Company, and
again will be available for grant under the Plan.

     11. Leaves of Absence. Unless the Administrator provides otherwise, vesting of Awards
granted hereunder will be suspended during any unpaid leave of absence. A Service Provider will
not cease to be an Employee in the case of (i) any leave of absence approved by the Company or (ii)
transfers between locations of the Company or between the Company, its Parent, or any Subsidiary.
For purposes of Incentive Stock Options, no such leave may exceed ninety (90) days, unless
reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment
upon expiration of a leave of absence approved by the Company is not so guaranteed, then three (3)
months following the 91st day of such leave any Incentive Stock Option held by the Participant will
cease to be treated as an Incentive Stock Option and will be treated for tax purposes as a
Nonstatutory Stock Option.

     12. Transferability of Awards. Unless determined otherwise by the Administrator, an
Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner
other than by will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Participant, only by the Participant. If the Administrator makes an Award
transferable, such Award will contain such additional terms and conditions as the Administrator
deems appropriate.

     13. Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset Sale.

          
(a) Changes in Capitalization. Subject to any required action by the stockholders of
the Company, the number of shares of Common Stock that have been authorized for issuance under the
Plan but as to which no Awards have yet been granted or which have been returned to the Plan upon
cancellation or expiration of an Award, the number of shares of Common Stock as well as the price
per share of Common Stock covered by each such outstanding Award, and the numerical Share limits in
Sections 6, 7, 8, 9 and 10, shall be proportionately adjusted for any change in, or increase or
decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock
split, stock dividend, spin-off, combination or reclassification of the Common Stock, or any other
change in, or increase or decrease in the number of issued shares of Common Stock effected without
receipt of consideration by the Company; provided, however, that conversion of any convertible
securities of the Company shall not be deemed to have been “effected without receipt of
consideration.” Such adjustment shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the
Company of shares of stock of any class, or securities convertible into shares of stock of any

13

 

class, shall affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock subject to an Award.

          
(b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Administrator shall notify each Participant as soon as practicable
prior to the effective date of such proposed transaction. The Administrator in its discretion may
provide for a Participant to have the right to exercise his or her Award until ten (10) days prior
to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which
the Award would not otherwise be exercisable. In addition, the Administrator may provide that any
Company repurchase option or reacquisition right applicable to any Restricted Stock shall lapse as
to all such Shares, provided the proposed dissolution or liquidation takes place at the time and in
the manner contemplated. To the extent it has not been previously exercised, an Award will
terminate immediately prior to the consummation of such proposed action.

          
(c) Merger or Asset Sale. In the event of a merger of the Company with or into another
corporation or the sale of all or substantially all of the Company’s assets, each outstanding Award
will be assumed or an equivalent award substituted by the successor corporation or a Parent or
Subsidiary of the successor corporation. In the event that the successor corporation refuses to
assume or substitute for the Award, the Participant will fully vest in and have the right to
exercise all of his or her outstanding Options and Stock Appreciation Rights, including Shares as
to which such Awards would not otherwise be vested or exercisable, all restrictions on Restricted
Stock and Restricted Stock Units will lapse, and, with respect to Performance Shares and
Performance Units, all Performance Goals or other vesting criteria will be deemed achieved at
target levels and all other terms and conditions met. In addition, if an Option or Stock
Appreciation Right becomes fully vested and exercisable in lieu of assumption or substitution in
the event of a merger or sale of assets, the Administrator will notify the Participant in writing
or electronically that the Option or Stock Appreciation Right will be fully vested and exercisable
for a period of time determined by the Administrator in its sole discretion, and the Option or
Stock Appreciation Right will terminate upon the expiration of such period.

          
For the purposes of this subsection (c), an Award will be considered assumed if, following the
merger or sale of assets, the Award confers the right to purchase or receive, for each Share
subject to the Award immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or property) or, in the case of a Stock Appreciation Right upon
the exercise of which the Administrator determines to pay cash or a Restricted Stock Unit,
Performance Share or Performance Unit which the Administrator can determine to pay in cash, the
fair market value of the consideration received in the merger or merger or sale of assets by
holders of Common Stock for each Share held on the effective date of the transaction (and if
holders were offered a choice of consideration, the type of consideration chosen by the holders of
a majority of the outstanding Shares); provided, however, that if such consideration received in
the merger or sale of assets is not solely common stock of the successor corporation or its Parent,
the Administrator may, with the consent of the successor corporation, provide for the consideration
to be received upon the exercise of an Option or Stock Appreciation Right or upon the payout of a
Restricted Stock Unit, Performance Share or Performance Unit, for each Share subject to such Award
(or in the case of Restricted Stock Units or Performance Units, the number of implied shares
determined by dividing the value of the Restricted Stock Units or Performance Units, as applicable,
by the per share consideration received by holders of Common Stock in the merger or sale of
assets), to be solely common stock of the successor corporation or its Parent equal in fair market
value to the per share consideration received by holders of Common Stock in the merger or sale of
assets.

14

 

          
Notwithstanding anything in this Section 13(c) to the contrary, an Award that vests, is earned
or paid-out upon the satisfaction of one or more Performance Goals will not be considered assumed
if the Company or its successor modifies any of such Performance Goals without the Participant’s
consent; provided, however, a modification to such Performance Goals only to reflect the successor
corporation’s post-transaction corporate structure will not be deemed to invalidate an otherwise
valid Award assumption.

     14. Tax Withholding

          
(a) Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to
an Award (or exercise thereof), the Company will have the power and the right to deduct or
withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy
federal, state, local, foreign or other taxes (including the Participant’s FICA obligation)
required to be withheld with respect to such Award (or exercise thereof).

          
(b) Withholding Arrangements. The Administrator, in its sole discretion and pursuant
to such procedures as it may specify from time to time, may permit a Participant to satisfy such
tax withholding obligation, in whole or in part by (without limitation) (a) paying cash, (b)
electing to have the Company withhold otherwise deliverable cash or Shares having a Fair Market
Value equal to the amount required to be withheld, (c) delivering to the Company already-owned
Shares having a Fair Market Value equal to the amount required to be withheld, or (d) selling a
sufficient number of Shares otherwise deliverable to the Participant through such means as the
Administrator may determine in its sole discretion (whether through a broker or otherwise) equal to
the amount required to be withheld. The amount of the withholding requirement will be deemed to
include any amount which the Administrator agrees may be withheld at the time the election is made,
not to exceed the amount determined by using the maximum federal, state or local marginal income
tax rates applicable to the Participant with respect to the Award on the date that the amount of
tax to be withheld is to be determined. The Fair Market Value of the Shares to be withheld or
delivered will be determined as of the date that the taxes are required to be withheld.

     15. No Effect on Employment or Service. Neither the Plan nor any Award will confer
upon a Participant any right with respect to continuing the Participant’s relationship as a Service
Provider with the Company, nor will they interfere in any way with the Participant’s right or the
Company’s right to terminate such relationship at any time, with or without cause, to the extent
permitted by Applicable Laws.

     16. Date of Grant. The date of grant of an Award will be, for all purposes, the date
on which the Administrator makes the determination granting such Award, or such other later date as
is determined by the Administrator. Notice of the determination will be provided to each
Participant within a reasonable time after the date of such grant.

     17. Term of Plan. Subject to Section 21 of the Plan, the Plan shall become effective
upon its original adoption by the Board. It shall continue in effect for a term of ten (10) years
unless terminated earlier under Section 18 of the Plan.

     18. Amendment and Termination of the Plan.

          
(a) Amendment and Termination. The Administrator may at any time amend, alter,
suspend or terminate the Plan.

15

 

          
(b) Stockholder Approval. The Company will obtain stockholder approval of any Plan
amendment to the extent necessary and desirable to comply with Applicable Laws.

          
(c) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan will impair the rights of any Participant, unless mutually agreed otherwise
between the Participant and the Administrator, which agreement must be in writing and signed by the
Participant and the Company. Termination of the Plan will not affect the Administrator’s ability
to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior
to the date of such termination.

     19. Conditions Upon Issuance of Shares.

          
(a) Legal Compliance. Shares will not be issued pursuant to the exercise of an Award
unless the exercise of such Award and the issuance and delivery of such Shares will comply with
Applicable Laws and will be further subject to the approval of counsel for the Company with respect
to such compliance.

          
(b) Investment Representations. As a condition to the exercise of an Award, the
Company may require the person exercising such Award to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required.

     20. Inability to Obtain Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of
any liability in respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.

     21. Stockholder Approval. The Plan shall be subject to approval by the stockholders of
the Company within twelve (12) months after the date the Plan is adopted. Such stockholder
approval shall be obtained in the manner and to the degree required under Applicable Laws.

16exv10w1

 

Exhibit 10.1

May 17, 2007

Messrs.

L. Lowry Mays

Mark P. Mays, and

Randall T. Mays

200 East Basse Road

San Antonio, Texas 78209

Dear Lowry/Mark/Randall:

Reference is made to (i) the Agreement and Plan of Merger, dated as of November 16, 2006, as
amended through the date hereof (the “Merger Agreement”), by and among BT Triple Crown
Merger Co., Inc., B Triple Crown FinCo., LLC, T Triple Crown FinCo., LLC, and Clear Channel
Communications Inc. (“CCU”) and (ii) the letter agreement dated November 16, 2006 between
each of you and B Triple Crown FinCo., LLC and T Triple Crown FinCo., LLC (together, the
“Parents”) as amended by that certain extension letter dated March 16, 2007 (such letter
agreement, as so amended, the “November Letter Agreement”) relating to the Merger
Agreement. All capitalized terms not defined herein shall have the meaning set forth in the
November Letter Agreement.

In the November Letter Agreement, the parties agreed to commence good faith negotiations with
respect to the definitive Management Agreements and to agree upon the form and terms of such
agreements within one hundred twenty days after the date of execution of the Merger Agreement. The
parties commenced and have continued good faith negotiations, but such negotiations are not yet
complete. By letter agreement dated March 17, 2007, the parties extended the period for
negotiating the Management Agreements.

CCU’s stockholder meeting for approval of the Merger Agreement has been postponed; and it is
anticipated that on or about the date hereof CCU and the other parties to the Merger Agreement will
enter into a second amendment to the Merger Agreement that would, among other things, provide CCU
stockholders a “stock election” mechanic (pursuant to which CCU stockholders would be provided an
opportunity to elect to receive, in exchange for a portion of their CCU shares, shares of a new
holding company, BT Triple Crown Holdings III, Inc., that would join the Merger Agreement and
become the parent corporation of CCU), which in turn will require (i) mailing a new proxy statement
with respect to the proposed transaction, (ii) a further postponement of the CCU stockholder
meeting for consideration of the Merger Agreement and (iii) some changes to the terms of the
Management Agreements to reflect the fact that there will be a new holding company, that stock
options, restricted stock or other management equity incentives will be issued by that new holding
company, and that (because of legal requirements that would apply in light of stock ownership that
would arise from the above-referenced stock election mechanic) the new holding company will have
shares registered under the Securities Exchange Act of 1934, as amended.

The undersigned hereby agree to further amend the November Letter Agreement as follows:

 

 

     (1) the form and terms of the Management Agreements (excluding the Stockholder Agreements (as
defined below)) identified on Annex A to this letter agreement have been fully negotiated among the
parties to this letter agreement in good faith and each are attached hereto in substantially the
form to be executed by the relevant parties (including BT Triple Crown Holdings III, Inc., which
the Parents shall cause to enter into such agreements as applicable), with such other changes, if
any, as the parties may mutually agree; and, subject to the mutual agreement of the terms of the
stockholder’s agreement to be entered into by and between BT Triple Crown Holdings III, Inc., and
each of Messrs. Lowry, Mark and Randall Mays ( the “Stockholder Agreements”) shall be
executed promptly after finalization of the Stockholder Agreements;

     (2) we the Parents and each of you agree to use commercially reasonable best efforts to
negotiate and reach mutual agreement, reasonably and good faith, on the final form and terms of the
Stockholder Agreements as soon as reasonably practicable after the date hereof, but in no event by
no later than thirty days after approval of the Merger by CCU stockholders.

Except as provided herein or as otherwise provided in the Management Agreements (excluding the
Stockholder Agreements), as amended, all other terms of the November Letter Agreement shall remain
in full force and effect as set forth therein.

-2-

 

If you agree to the terms of this letter, please sign where indicated below and return it to
Loretta Richard at Ropes & Gray, LLP, either via facsimile (617-235-0409) or email at
loretta.richard@ropesgray.com.

	 	 	 	 	 	 	 
	 	 	Sincerely,	 	 
	 
	 	 	 	 	 	 
	 	 	B Triple Crown FinCo., LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 	 	Name:	 	 
	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	T Triple Crown FinCo., LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 	 	Name:	 	 
	 	 	Title:	 	 

-3-

 

[May 2007 Supplement to Nov. 2007 Letter Agreement Signature Page]

Accepted
and agreed this ___ day of May, 2007.

                                                            

L. Lowry Mays

-4-

 

[May 2007 Supplement to Nov. 2007 Letter Agreement Signature Page]

Accepted
and agreed this ___ day of May, 2007.

                                                            

Mark P. Mays

-5-

 

[May 2007 Supplement to Nov. 2007 Letter Agreement Signature Page]

Accepted
and agreed this ___ day of May, 2007.

                                                            

Randall T. Mays

-6-

 

Annex A to May 2007 Supplement

To November 2007 Letter Agreement

Clear Channel Communications

Management Term Sheet: Proposed Forms of Agreement 

Employment Agreement – Lowry Mays

Employment Agreement – Randall/Mark Mays

Form of Release of Claims

2007 Equity Incentive Plan

Restricted Stock Agreement – Randall/Mark Mays

Rollover Option Agreement – Randall/May Mays

Senior Executive Stock Option Agreement – Randall/Mark Mays

-7-

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     AGREEMENT, dated effective as of [CLOSING DATE], by and between BT Triple Crown Merger Co.,
Inc (“MergerSub”, together with its successors, the “Company”), BT Triple Crown Capital Holdings
III, Inc. (“Holdings”) and L. Lowry Mays (“Executive”).

     WHEREAS, Clear Channel Communications, Inc., a Texas corporation and the Executive previously
entered into that certain Employment Agreement dated as of March 10, 2005 (the “Existing
Agreement”); and

     WHEREAS, the Clear Channel Communications, Inc. has entered into an Agreement and Plan of
Merger dated as of November 16, 2006, as amended (the “Merger Agreement”) pursuant to which, on the
terms and subject to the conditions set forth therein, MergerSub shall merge within and into Clear
Channel Communications, Inc., with Clear Channel Communications, Inc. surviving such merger at and
after the Effective Time (as defined in the Merger Agreement), and Holdings shall, on the date of
consummation of the transactions contemplated under the Merger Agreement, be the ultimate parent
holding company of the Company; and

     WHEREAS, the Company and the Executive desire to amend and restate the terms of the Existing
Agreement between the Company and the Executive, to be effective as of the Effective Time; and

     NOW THEREFORE, IN CONSIDERATION of the premises and the mutual covenants set forth below, the
parties hereby amend and restate the Existing Agreement effective as of the Effective Time as
follows:

     1. Employment. The Company hereby agrees to continue to employ Executive as the
Chairman Emeritus, and Executive hereby accepts such continued employment, on the terms and
conditions hereinafter set forth.

     2. Term. The period of employment of Executive by the Company under this Agreement
(the “Employment Period”) shall commence on the date upon which the Effective Time occurs (the
“Effective Date”) and shall have an original term of five (5) years (the “Original Term”). The
Employment Period shall automatically be extended thereafter for successive terms of one (1) year
each. The Employment Period may be sooner terminated by either party in accordance with Section 6
of this Agreement.

     3. Position and Duties. During the Employment Period, Executive shall serve as
Chairman Emeritus of the Company and of Holdings, and shall report solely and directly to the Board
of Directors (the “Board”) of Holdings. Executive’s duties shall be limited to assisting the Board
of the Company and the Board of Holdings with the overall strategic direction of the Company, as
and to the extent requested by the Board of Holdings. Executive shall devote as much of his
working time, attention and energies during normal business hours (other than absences due to
illness or vacation) to satisfactorily perform his duties for the Company. Notwithstanding the
above, Executive shall be permitted, to the extent such activities do not substantially interfere
with the performance by Executive of his duties and responsibilities

-1-

 

hereunder or violate Section 10 hereof, to (i) manage Executive’s personal, financial and
legal affairs, (ii) serve on civic or charitable boards or committees or on the Board of Directors
of Live Nations Inc. and its committees (it being expressly understood and agreed that Executive’s
continuing to serve on any such boards and/or committees on which Executive is serving, or with
which Executive is otherwise associated, as of the Effective Date shall be deemed not to interfere
with the performance by Executive of his duties and responsibilities under this Agreement), (iii)
deliver lectures or fulfill speaking engagements; and (iv) engage in any other activity that is not
in violation of Section 10 hereof; provided such activities do not conflict with the interests of
the Company or its Affiliates or otherwise interfere (other than to a de minimis extent),
individually or in the aggregate, with the performance of the Executive’s duties hereunder.

     4. Place of Performance. The principal place of employment of Executive shall be at
the Company’s principal executive offices in San Antonio, Texas.

     5. Compensation and Related Matters.

     (a) Base Salary and Bonus. During the Employment Period, the Company shall pay
Executive a base salary at the rate of Two Hundred Fifty Thousand Dollars ($250,000) per
year (“Base Salary”). Executive’s Base Salary shall be paid in approximately equal
installments in accordance with the Company’s customary payroll practices. In addition to
Base Salary, Executive shall be eligible to receive an annual bonus (the “Performance
Bonus”). The amount of the Performance Bonus shall be determined by the Board of Holdings
(which may act through its Compensation Committee) in its sole discretion, provided,
however, that in any year during the Employment Period in which the Company achieves at
least eighty percent (80%) of the budgeted OIBDAN for the given year (the “Target OIBDAN”)
as set forth in the Management Plan previously presented to the Sponsor Group1
(as defined in the [___]) and consistent with the requirements of Section 162(m) of the
Internal Revenue Code of 1986, as amended (the “Code”), to the extent applicable, such
Performance Bonus shall be no less than One Million Dollars ($1,000,000). The Management
Plan will be subject to equitable adjustment by the Compensation Committee of Holdings to
take into account material acquisitions, dispositions and other material extraordinary
events; provided, that the parties hereto will use their reasonable best efforts to
facilitate the payment of the bonuses hereunder on a basis that is consistent with such
payment qualifying for the performance-based compensation exception under Section 162(m) of
the Code and the regulations thereunder. If the Company does not achieve the Target OIBDAN
in any given year, the amount of the Performance Bonus, if any, shall be determined by the
Board of Holdings in its sole discretion. The Performance Bonus, if any, shall be payable
in one lump sum between January 1 and March 15 of the year following the year for which the
Performance Bonus was earned.

     (b) Expenses. The Company shall promptly reimburse Executive for all
reasonable business expenses upon the presentation of reasonably itemized statements of such
expenses, in accordance with the Company’s policies and procedures now in force or as such
policies and procedures may be modified generally with respect to senior executive officers
of the Company.

 

			
	1	 	Presented on May 17, 2007.

-2-

 

     (c)  Vacation. Executive shall be entitled to the number of weeks of paid
vacation per year that he was eligible for immediately prior to the date of this Agreement,
but in no event less than four (4) weeks annually. Unused vacation may be carried forward
from year to year. Vacation shall otherwise be governed by the policies of the Company, as
in effect from time to time. In addition to vacation, Executive shall be entitled to the
number of sick days and personal days per year that other senior executive officers of the
Company with similar tenure are entitled to under the Company’s policies.

     (d) Services Furnished. During the Employment Period, the Company shall
furnish Executive with office space, stenographic and secretarial assistance and such other
facilities and services no less favorable than what he was receiving immediately prior to
the date of this Agreement (i.e., one full-time assistant and one part-time
bookkeeper and office space for them). The Company shall also furnish office space for up
to two (2) additional people, to be designated by Executive; provided, however, that such
individuals shall not be on the Company’s payroll and shall not perform services of any kind
for the Company or any of its Affiliates and the Company shall have no liability for
federal, state or local taxes related to the performance of such individuals’ services.

     (e) Welfare, Pension and Incentive Benefit Plans. During the Employment
Period, Executive (and his spouse and dependents to the extent provided) shall be entitled
to participate in and be covered under all the welfare benefit plans or programs maintained
by the Company from time to time for the benefit of its senior executive officers,
including, without limitation, all medical, hospitalization, dental, disability, accidental
death and dismemberment and travel accident insurance plans and programs. During the
Employment Period, the Company shall provide to Executive (and his spouse and dependents to
the extent provided under the applicable plans and programs) the same type and substantially
equivalent levels of participation and employee benefits (except severance pay plans and,
except with the express consent of the Board of Holdings, incentive bonus programs other
than as explicitly set forth in Section 5(a) hereof) as are being provided to other senior
executives (and their spouses and dependents to the extent provided under the applicable
plans or programs) on the Effective Date, subject to modifications affecting all senior
executive officers.

     (f) Other Perquisites. During the Employment Period, Executive shall be
entitled to receive, in the same level and amount as received on November 16, 2006:

	 	(i)	 	the use of an automobile appropriate to his
position;
	 
	 	(ii)	 	reimbursement for the full amount of annual
dues for membership in one social dining club; and
	 
	 	(iii)	 	use of a Company-provided aircraft for
personal travel, in accordance with Company policy as in effect on
November 16, 2006; provided, however, Executive shall be entitled to
continued use of such aircraft on that same basis for ten (10) years
following the Effective Date, regardless of whether Executive remains
employed by the Company.

-3-

 

     6. Termination. Executive’s employment hereunder may be terminated under the
following circumstances:

     (a) Death. During the Employment Period, Executive’s employment hereunder
shall terminate upon his death.

     (b) Disability. Following the Original Term, if, as a result of Executive’s
incapacity due to physical or mental illness, Executive shall have been substantially unable
to perform his duties hereunder notwithstanding the provision of reasonable accommodation
for a period of six (6) consecutive months, and within thirty (30) days after written Notice
of Termination is given after such six (6) month period Executive shall not have returned to
the substantial performance of his duties on a full-time basis, the Company shall have the
right to terminate Executive’s employment hereunder for “Disability”, and such termination
in and of itself shall not be, nor shall it be deemed to be, a breach of this Agreement.

     (c) By Executive. During the Employment Period, Executive shall have the right
to terminate his employment by providing the Company with a Notice of Termination at least
thirty (30) days prior to such termination, and such termination shall not in and of itself
be, nor shall it be deemed to be, a breach of this Agreement. In the event of termination
pursuant to this Section 6(c), the Board of the Company may elect to waive the period of
notice, or any portion thereof, and, if the Board so elects, the Company will pay Executive
his Base Salary for the initial thirty (30) days of the notice period or for any lesser
remaining portion of such period, payable in accordance with the regular payroll practices
of the Company.

     (d) By the Company For Extraordinary Cause. During the Original Term, in
addition to termination in accordance with Section 6(a) hereof, the Company shall have the
right to terminate Executive’s employment only for Extraordinary Cause, by providing
Executive with a Notice of Termination, and such termination in and of itself shall not be,
nor shall it be deemed to be, a breach of this Agreement. For purposes of this Agreement,
the Company shall have “Extraordinary Cause” to terminate Executive’s employment upon
Executive’s:

	 	(i)	 	conviction of a felony or other crime involving
moral turpitude; or
	 
	 	(ii)	 	willful misconduct that is materially and
demonstrably injurious to the Company.

     For purposes of this Section 6(d), no act, or failure to act, by Executive shall be considered
“willful” unless committed in bad faith and without a reasonable belief that the act or omission
was in the best interests of the Company or any entity in control of, controlled by or under common
control with the Company (“Affiliates”) thereof. For the avoidance of doubt, “Affiliates” shall
include Holdings. Extraordinary Cause shall not exist under paragraph (ii) unless and until the
Company has delivered to Executive a copy of a resolution duly adopted by a majority of the members
of the Board of the Company at a meeting of the Board called and held for such purpose (after
reasonable (but in no event less than thirty (30) days) notice to Executive and an opportunity for
Executive, together with his counsel, to be heard before the

-4-

 

Board), finding that in the good faith opinion of the Board, Executive was guilty of the conduct
set forth in paragraph (ii) and specifying the particulars thereof in detail; provided that at
least a majority of the members of the Board of Holdings has determined prior to such meeting that
Cause exists. This Section 6(d) shall not prevent Executive from challenging in any arbitration or
court of competent jurisdiction the Board’s determination that Extraordinary Cause exists or that
Executive has failed to cure any act (or failure to act) that purportedly formed the basis for the
Board’s determination.

     (e) By the Company Following the Original Term. Following the Original Term,
the Company shall have the right to terminate Executive’s employment with or without
Extraordinary Cause by providing Executive with a Notice of Termination, and such
termination shall not in and of itself be, nor shall it be deemed to be, a breach of this
Agreement.

     7. Termination Procedure.

     (a) Notice of Termination. Any termination of Executive’s employment during
the Employment Period (other than termination pursuant to Section 6(a)) shall be
communicated by written Notice of Termination to the other party hereto in accordance with
Section 14. For purposes of this Agreement, a “Notice of Termination” shall mean a notice
which indicates the specific termination provision in this Agreement relied upon and sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of Executive’s employment under the provision so indicated.

     (b) Date of Termination. “Date of Termination” shall mean (i) if Executive’s
employment is terminated by his death, the date of his death, (ii) if Executive’s employment
is terminated pursuant to Section 6(b), thirty (30) days after Notice of Termination
(provided that Executive shall not have returned to the substantial performance of his
duties on a full-time basis during such thirty (30) day period), and (iii) if Executive’s
employment is terminated for any other reason, the date on which a Notice of Termination is
given or any later date set forth in such Notice of Termination.

     8. Compensation Upon Termination. In the event Executive’s employment terminates
during the Employment Period, the Company shall provide Executive with the payments and benefits
set forth below:

     (a) Extraordinary Cause or By Executive. If Executive’s employment is
terminated by the Company for Extraordinary Cause or by Executive, the Company shall pay
Executive his Base Salary, Bonus and unused vacation pay accrued or prorated through the
Date of Termination, and shall reimburse Executive pursuant to Section 5(b) for reasonable
business expenses incurred but not paid prior to such termination of employment (together,
“Final Compensation”). The Base Salary and vacation pay components of Final Compensation
shall be paid in a lump sum as soon as practicable following the Date of Termination, but in
no event later than two and a half months following the end of the taxable year including
the Date of Termination. The Bonus component of Final Compensation shall be calculated by
multiplying the amount of the Performance Bonus Executive would have earned had he remained
employed for the full year (if any) by a fraction, the numerator of which is the number of
days during such year

-5-

 

that Executive was employed and the denominator of which is 365, and shall be paid at
the time bonuses for the year in which the Date of Termination occurs are paid to executives
of the Company generally, but in no event later than two and a half months following the end
of the taxable year in which the Date of Termination occurs. The Company shall have no
further obligation to Executive upon such termination under this Agreement.

     (b) Death. If Executive’s employment is terminated by his death, the Company
shall pay Final Compensation to Executive’s beneficiary, legal representatives or estate, as
the case may be, at the time and in the manner set forth in Section 8(a) hereof. The Company
shall have no further obligation to Executive upon such termination under this Agreement.

     (c) Termination By the Company Without Extraordinary Cause Following the Original
Term. If, following the Original Term, the Company terminates Executive’s employment
without Extraordinary Cause:

	 	(i)	 	the Company shall pay Executive the Final
Compensation at the time and in the manner set forth in Section 8(a)
hereof, except that Executive shall not receive the Bonus component of
Final Compensation;
	 
	 	(ii)	 	provided that Executive signs and returns to
the Company a timely and effective release of claims substantially in
the form attached hereto as Exhibit A (the “Executive Release
of Claims”), the Company shall pay Executive a lump-sum cash payment
equivalent to any Base Salary and Performance Bonus to which he would
otherwise have been entitled had he remained employed for the remainder
of the then-current term. Following the Company’s receipt of a timely
and effective Release of Claims, the Company and Holdings shall execute
a release of claims in favor of Executive substantially in the form
attached hereto as Exhibit B (the “Company Release of Claims”).
Any Base Salary to which Executive is entitled to hereunder shall be
paid within ninety (90) days following the Date of Termination, and any
Performance Bonus to which Executive is entitled hereunder shall be
paid at the time bonuses for the year in which termination occurs are
paid to executives of the Company generally, but in no event later than
two and a half months following the end of the taxable year including
the Date of Termination. The Executive Release of Claims required for
this benefit creates legally binding obligations on Executive and the
Company and its Affiliates therefore advise Executive to seek the
advice of an attorney before signing it; and
	 
	 	(iii)	 	the Company shall maintain in full force and
effect, for the continued benefit of the Executive and his eligible
dependents, for a period of five (5) years following the Date of
Termination the medical and hospitalization insurance programs in which
the

-6-

 

	 	 	 	Executive and his dependents were participating immediately prior to
the Date of Termination, at the level in effect and upon
substantially the same terms and conditions (including without
limitation contributions required by Executive for such benefits) as
existed immediately prior to the Date of Termination; provided, that
if Executive or his dependents cannot continue to participate in the
Company plans and programs providing these benefits, the Company
shall arrange to provide Executive and his dependents with the
economic equivalent of such benefits which they otherwise would have
been entitled to receive under such plans and programs (the
“Continued Benefits”), provided, that such Continued Benefits shall
terminate on the date or dates Executive receives equivalent coverage
and benefits, without waiting period or pre-existing condition
limitations, under the plans and programs of a subsequent employer.
The Company shall also provide the Executive with an additional cash
payment in an amount equal to the federal, state and local taxes due
in connection with the Continued Benefits, which shall be payable to
Executive within five (5) business days following the Effective Time
(the “Gross-Up Payment”). Notwithstanding anything to the contrary
in this Section 8(c)(iii), the aggregate value of the Continued
Benefits and the Gross-Up Payment shall in no event exceed Three
Million Dollars ($3,000,000) (the “Aggregate Cap”); accordingly, the
Company’s obligation to provide the Continued Benefits shall cease
once the value of the Gross-Up Payment and the Continued Benefits
that have been provided to the Executive and/or his dependents
reaches the Aggregate Cap, even if such date occurs prior to the five
(5)-year anniversary of the Date of Termination.

-7-

 

     (d) Disability Following the Original Term. If Executive’s employment is
terminated by reason of his Disability following the Original Term, the Company shall pay
Executive the Final Compensation at the time and in the manner set forth in Section 8(a)
hereof. The Company shall have no further obligation to Executive upon such termination
under this Agreement.

     (e) Timing of Payments. If at the time of Executive’s separation from service,
Executive is a “specified employee,” as hereinafter defined, any and all amounts payable
under this Section 8 in connection with such separation from service that constitute
deferred compensation subject to Section 409A of Code (“Section 409A”), as determined by the
Company in its sole discretion, and that would (but for this sentence) be payable within six
months following such separation from service, shall instead be paid on the date that
follows the date of such separation from service by six (6) months. For purposes of the
preceding sentence, “separation from service” shall be determined in a manner consistent
with subsection (a)(2)(A)(i) of Section 409A and the term “specified employee” shall mean an
individual determined by the Company to be a specified employee as defined in subsection
(a)(2)(B)(i) of Section 409A.

     9. Mitigation. Executive shall not be required to mitigate amounts payable under this
Agreement by seeking other employment or otherwise, and there shall be no offset against amounts
due Executive under this Agreement on account of subsequent employment except as specifically
provided herein. Additionally, amounts owed to Executive under this Agreement shall not be offset
by any claims the Company may have against Executive, and the Company’s obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations hereunder shall
not be affected by any other circumstances, including, without limitation, any counterclaim,
recoupment, defense or other right which the Company may have against Executive or others.

     10. Restrictive Covenants.

     (a) Confidential Information.

	 	(i)	 	Executive acknowledges that the Company and its
Affiliates continually develop Confidential Information, that Executive
has developed and will develop Confidential Information for the Company
or its Affiliates, and that Executive has learned and will learn of
Confidential Information during the course of his employment.
Executive will comply with the policies and procedures of the Company
and its Affiliates for protecting Confidential Information. Executive
shall hold in a fiduciary capacity for the benefit of the Company all
trade secrets and Confidential Information, knowledge or data relating
to the Company, its Affiliates and their businesses and investments,
which shall have been obtained by Executive during Executive’s
employment by the Company and which is not generally available public
knowledge (other than by acts of Executive in violation of this
Agreement or by any other person having an obligation of
confidentiality to the Company or any of its Affiliates). Except as

-8-

 

	 	 	 	may be required or appropriate in connection with carrying out his
duties under this Agreement, Executive shall not, without the prior
written consent of the Company or as may otherwise be required by law
or any legal process, or as is necessary in connection with any
adversarial proceeding against the Company (in which case Executive
shall use his reasonable best efforts in cooperating with the Company
in obtaining a protective order against disclosure by a court of
competent jurisdiction), use, communicate or divulge any such trade
secrets, Confidential Information, knowledge or data to anyone other
than the Company and those designated by the Company or on behalf of
the Company in the furtherance of its business. Executive
understands that this restriction shall continue to apply after his
employment terminates, regardless of the reason for such termination.
	 
	 	 	 	For purposes of this Agreement, “Confidential Information” shall mean
any and all information of the Company and its Affiliates that is
not generally known by those with whom the Company or any of its
Affiliates competes or does business, or with whom the Company or any
of its Affiliates plans to compete or do business, and any and all
information, publicly known in whole or in part or not, which, if
disclosed by the Company or any of its Affiliates, would assist in
competition against them. Confidential Information includes without
limitation such information relating to (i) the development,
research, testing, manufacturing, marketing and financial activities
of the Company and its Affiliates, (ii) the costs, sources of supply,
financial performance and strategic plans of the Company and its
Affiliates, (iii) the identity and special needs of the customers of
the Company and its Affiliates and (iv) the people and
organizations with whom the Company and its Affiliates have business
relationships and the nature and substance of those relationships.
Confidential Information also includes any information that the
Company or any of its Affiliates has received, or may receive
hereafter, belonging to customers or others with any understanding,
express or implied, that the information would not be disclosed to
others.
	 
	 	 	 	For purposes of this Agreement, “Affiliates” shall mean all persons
and entities directly or indirectly controlling, controlled by or
under common control with the Company, where control may be by
management authority, contract or equity interest. For the avoidance
of doubt, “Affiliates” shall include Holdings.
	 
	 	(ii)	 	All documents, records, tapes and other media
of every kind and description relating to the business, present or
otherwise, of the Company or its Affiliates, and any copies, in whole
or in part, thereof (the “Documents”), whether or not prepared by
Executive,

-9-

 

	 	 	 	shall be the sole and exclusive property of the Company and its
Affiliates. Executive shall safeguard all Documents and shall
surrender to the Company at the time his employment terminates, or at
such earlier time or times as the Board of the Company or Holdings or
its designee may specify, all Documents then in Executive’s
possession or control.

     (b) Restricted Activities. Executive hereby agrees that some restrictions on
his activities during and after his employment are necessary to protect the goodwill, trade
secrets, Confidential Information and other legitimate interests of the Company and its
Affiliates. In consideration of Executive’s employment hereunder, and the Company’s
agreement to grant Executive access to trade secrets and other Confidential Information of
the Company and its Affiliates and to their customers, and in view of the confidential
position to be held by Executive hereunder, Executive agrees as follows:

	 	(i)	 	Non-Solicitation. During the
Employment Period and during the two year period immediately following
termination of the Employment Period (the “Restricted Period”),
Executive shall not, directly or indirectly: (A) hire, solicit for
hiring or assist in any way in the hiring of any employee or
independent contractor of the Company or any of its Affiliates, or
induce or otherwise attempt to influence any employee or independent
contractor to terminate or diminish such employment or contractor
relationship or to become employed by any other radio broadcasting
station or any other entity engaged in the radio business, the
television business or in any other business in which the Company or
any of its Affiliates is engaged (which, for the avoidance of doubt,
includes without limitation the business of providing clients with
advertising opportunities through billboards, street furniture
displays, transit displays and other out-of-home advertising displays,
such as wallscapes, spectaculars and mall displays (the “Outdoor
Business”)), or (B) solicit or encourage any customer of the Company or
any of its Affiliates to terminate or diminish its relationship with
them, or seek to persuade any such customer or prospective customer to
conduct with anyone else any business or activity which such customer
or prospective customer conducts or could conduct with the Company or
any of its Affiliates. For purposes of this Agreement, an “employee”
of the Company or any of its Affiliates is any person who was such at
any time within the preceding two years; a “customer” of the Company or
any of its Affiliates is any person or entity who is or has been a
customer at any time within the preceding two years; and a “prospective
customer” is any person or entity whose business has been solicited on
behalf of the Company or any of its Affiliates at any time within the
preceding two years, other than by form letter, blanket mailing or
published advertisement.

-10-

 

	 	(ii)	 	Non-Competition. During the Restricted
Period, Executive shall not, directly or indirectly, whether as owner,
partner, investor, consultant, agent, employee, co-venturer or
otherwise, compete with the Company or any of its Affiliates within the
United States or anywhere else in the world where the Company or any of
its Affiliates does business, or undertake any planning for any
business competitive with the Company or any of its Affiliates.
Specifically, but without limiting the foregoing, Executive agrees not
to engage in any manner in any activity that is directly or indirectly
competitive or potentially competitive with the business of the Company
or any of its Affiliates as conducted or under consideration at any
time during Executive’s employment, and Executive further agrees not to
work for or provide services to, in any capacity, whether as an
employee, independent contractor or otherwise, whether with or without
compensation, any person or entity that is engaged in any business that
is competitive with the business of the Company or any of its
Affiliates for which the Executive has provided services, as conducted
or in planning during his employment. For the purposes of this Section
10, the business of the Company and its Affiliates shall include the
radio and television businesses, the Outdoor Business and any other
business that was conducted or in planning during the Executive’s
employment. The foregoing, however, shall not prevent Executive’s
direct or beneficial ownership of up to five percent (5%) of the equity
securities of any entity, whether or not in the same or competing
business.

     (c) Assignment of Rights to Intellectual Property.

	 	(i)	 	Executive shall promptly and fully disclose all
Intellectual Property to the Company. Executive hereby assigns and
agrees to assign to the Company (or as otherwise directed by the
Company) Executive’s full right, title and interest in and to all
Intellectual Property. Executive agrees to execute any and all
applications for domestic and foreign patents, copyrights or other
proprietary rights and to do such other acts (including without
limitation the execution and delivery of instruments of further
assurance or confirmation) requested by the Company to assign the
Intellectual Property to the Company and to permit the Company to
enforce any patents, copyrights or other proprietary rights to the
Intellectual Property. Executive will not charge the Company for time
spent in complying with these obligations. All copyrightable works
that Executive creates shall be considered “work made for hire” and
shall, upon creation, be owned exclusively by the Company.
	 
	 	(ii)	 	For purposes of this Agreement, “Intellectual
Property” means:

-11-

 

	 	 	 	inventions, discoveries, developments, methods, processes,
compositions, works, concepts and ideas (whether or not patentable or
copyrightable or constituting trade secrets) conceived, made,
created, developed or reduced to practice by Executive (whether alone
or with others, whether or not during normal business hours or on or
off Company premises) during Executive’s employment that relate to
either the Products or any prospective activity of the Company or any
of its Affiliates or that make use of Confidential Information or
any of the equipment or facilities of the Company or any of its
Affiliates; and “Products” means all products planned, researched,
developed, tested, manufactured, sold, licensed, leased or otherwise
distributed or put into use by the Company or any of its Affiliates,
together with all services provided or planned by the Company or any
of its Affiliates, during Executive’s employment.

     (d) Conflict of Interest. Executive agrees that, during his employment with
the Company, he will not undertake any outside activity, whether or not competitive with the
business of the Company or its Affiliates, that could reasonably give rise to a conflict of
interest or otherwise interfere with his duties and obligations to the Company or any of its
Affiliates.

     (e) Modification of Covenants. The parties hereby acknowledge that the
restrictions in this Section 10 have been specifically negotiated and agreed to by the
parties hereto, and are limited only to those restrictions necessary to protect the Company
and its Affiliates from unfair competition. Executive acknowledges that he has carefully
read and considered all the terms and conditions of this Agreement, including the
restrictions in Section 10 hereof, and agrees without reservation that each of the
restraints contained herein is necessary for the reasonable and proper protection of the
goodwill, trade secrets, Confidential Information and other legitimate interests of the
Company and its Affiliates; and that each and every one of those restraints is reasonable in
respect to subject matter, length of time and geographic area. Executive acknowledges that
the Company operates in major, medium and small-sized markets throughout the United States
and many foreign countries, that the effect of Section 10(b) may be to prevent him from
working in a competitive business after his termination of employment hereunder, and that
these restraints, individually or in the aggregate, will not prevent him from obtaining
other suitable employment during the period in which he is bound by such restraints. The
parties hereby agree that if the scope or enforceability of any provision, paragraph or
subparagraph of this Section 10 is in any way disputed at any time, and should a court find
that such restrictions are overly broad, the court shall modify and enforce the covenant to
permit its enforcement to the maximum extent permitted by law. Each provision, paragraph
and subparagraph of this Section 10 is separable from every other provision, paragraph, and
subparagraph, and constitutes a separate and distinct covenant.

     (f) Remedies. Executive hereby expressly acknowledges that any breach or
threatened breach by Executive of any of the terms set forth in Section 10 of this

-12-

 

Agreement would result in significant, irreparable and continuing injury to the
Company, the monetary value of which would be difficult to establish or measure. Therefore,
Executive agrees that, in addition to any other remedies available to it, the Company shall
be entitled to preliminary and permanent injunctive relief in a court of appropriate
jurisdiction against any breach or threatened breach, without having to post bond, as well
as the recovery of all reasonable attorney’s fees expended in enforcing its rights
hereunder.

     11. Indemnification.

     (a) General. The Company agrees that if Executive is made a party or is
threatened to be made a party to any action, suit or proceeding, whether civil, criminal,
administrative or investigative (a “Proceeding”), by reason of the fact that Executive is or
was a trustee, director or officer of the Company, Holdings, or any subsidiary thereof, or
is or was serving at the request of the Company or any subsidiary as a trustee, director,
officer, member, employee or agent of another corporation or a partnership, joint venture,
trust or other enterprise, including, without limitation, service with respect to employee
benefit plans, whether or not the basis of such Proceeding is alleged action in an official
capacity as a trustee, director, officer, member, employee or agent while serving as a
trustee, director, officer, member, employee or agent, Executive shall be indemnified and
held harmless by the Company to the fullest extent authorized by Texas law, as the same
exists or may hereafter be amended, against all Expenses incurred or suffered by Executive
in connection therewith, and such indemnification shall continue as to Executive even if
Executive has ceased to be an officer, director, trustee or agent, or is no longer employed
by the Company, and shall inure to the benefit of his heirs, executors and administrators.

     (b) Expenses. As used in this Agreement, the term “Expenses” shall include,
without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes,
settlements, costs, attorneys’ fees, accountants’ fees, and disbursements and costs of
attachment or similar bonds, investigations, and any expenses of establishing a right to
indemnification under this Agreement.

     (c) Enforcement. If a valid claim or request under this Agreement is not paid
by the Company or on its behalf within thirty (30) days after a written claim or request has
been received by the Company, Executive may at any time thereafter bring suit against the
Company to recover the unpaid amount of the claim or request and, if successful in whole or
in part, Executive shall be further entitled to be paid the expenses of prosecuting such
suit. All obligations for indemnification hereunder shall be subject to, and paid in
accordance with, applicable Texas law.

     (d) Partial Indemnification. If Executive is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of any Expenses, but
not, however, for the total amount thereof, the Company shall nevertheless indemnify
Executive for the portion of such Expenses to which Executive is entitled.

     (e) Advances of Expenses. Expenses incurred by Executive in connection with
any Proceeding shall be paid by the Company in advance upon request of Executive

-13-

 

that the Company pay such Expenses; but, only in the event that Executive shall have
delivered in writing to the Company (i) an undertaking to reimburse the Company for Expenses
with respect to which Executive is not entitled to indemnification and (ii) an affirmation
of his good faith belief that the standard of conduct necessary for indemnification by the
Company has been met.

     (f) Notice of Claim. Executive shall give to the Company notice of any claim
made against him for which indemnification will or could be sought under this Agreement. In
addition, Executive shall give the Company such information and cooperation as it may
reasonably require and as shall be within Executive’s power and at such times and places as
are mutually convenient for Executive and the Company.

     (g) Defense of Claim. With respect to any Proceeding as to which Executive
notifies the Company of the commencement thereof:

	 	(i)	 	The Company will be entitled to participate
therein at its own expense; and
	 
	 	(ii)	 	Except as otherwise provided below, to the
extent that it may wish, the Company will be entitled to assume the
defense thereof, with counsel reasonably satisfactory to Executive,
which in the Company’s sole discretion may be regular counsel to the
Company and may be counsel to other officers and directors of the
Company or any subsidiary. Executive shall also have the right to
employ his own counsel in such action, suit or proceeding if he
reasonably concludes that failure to do so would involve a conflict of
interest between the Company and Executive, and, under such
circumstances, the fees and expenses of such counsel shall be at the
expense of the Company.
	 
	 	(iii)	 	The Company shall not be liable to indemnify
Executive under this Agreement for any amounts paid in settlement of
any action or claim effected without its written consent. The Company
shall not settle any action or claim in any manner which would impose
any penalty or limitation on Executive without Executive’s written
consent. Neither the Company nor Executive will unreasonably withhold
or delay their consent to any proposed settlement.

     (h) Non-exclusivity. The right to indemnification and the payment of expenses
incurred in defending a Proceeding in advance of its final disposition conferred in this
Section 11 shall not be exclusive of any other right which Executive may have or hereafter
may acquire under any statute, provision of the declaration of trust or certificate of
incorporation or by-laws of the Company, Holdings, or any subsidiary, agreement, vote of
shareholders or disinterested directors or trustees, or otherwise.

     12. Arbitration. Except as provided for in Section 10 of this Agreement, if any
contest or dispute arises between the parties with respect to this Agreement, such contest or
dispute shall be submitted to binding arbitration for resolution in San Antonio, Texas in

-14-

 

accordance with the rules and procedures of the Employment Dispute Resolution Rules of the
American Arbitration Association then in effect. The decision of the appointed arbitrator shall be
final and binding on both parties, and any court of competent jurisdiction may enter judgment upon
the award. The losing party shall pay all expenses relating to such arbitration, including, but
not limited to, the prevailing party’s legal fees and expenses.

     13. Successors; Binding Agreement.

     (a) Company’s Successors. No rights or obligations of the Company under this
Agreement may be assigned or transferred, except that the Company will require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly assume and agree
to perform this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no such succession had taken place. As used in this Agreement,
“Company” shall mean the Company as hereinabove defined and any successor to its business
and/or assets (by merger, purchase or otherwise) which executes and delivers the agreement
provided for in this Section 13 or which otherwise becomes bound by all the terms and
provisions of this Agreement by operation of law.

     (b) Executive’s Successors. No rights or obligations of Executive under this
Agreement may be assigned or transferred by Executive other than his right to payments or
benefits hereunder, which may be transferred only by will or the laws of descent and
distribution. Upon Executive’s death, this Agreement and all rights of Executive hereunder
shall inure to the benefit of and be enforceable by Executive’s beneficiary or
beneficiaries, personal or legal representatives, or estate, to the extent any such person
succeeds to Executive’s interests under this Agreement. Executive shall be entitled to
select and change a beneficiary or beneficiaries to receive any benefit or compensation
payable hereunder following Executive’s death by giving the Company written notice thereof.
In the event of Executive’s death or a judicial determination of his incompetence, reference
in this Agreement to Executive shall be deemed, where appropriate, to refer to his
beneficiary(ies), estate or other legal representative(s). If Executive should die following
his Date of Termination while any amounts would still be payable to him hereunder if he had
continued to live, all such amounts unless otherwise provided herein shall be paid in
accordance with the terms of this Agreement to such person or persons so designated in
writing by Executive, or otherwise to his legal representatives or estate.

     14. Notice. For the purposes of this Agreement, notices, demands and all other
communications provided for in this Agreement shall be in writing and shall be deemed to have been
duly given when delivered either personally or by United States certified or registered mail,
return receipt requested, postage prepaid, addressed as follows:

     If to Executive:

L. Lowry Mays

200 East Basse Road

San Antonio, Texas 78209

     with a copy to:

-15-

 

Simpson, Thacher & Bartlett LLP

425 Lexington Avenue

New York, New York 10017

Attn: Andrea K. Wahlquist

     If to the Company:

BT Triple Crown Capital Holdings III, Inc.

200 East Basse Road

San Antonio, Texas 78209

Attention: Chief Executive Officer

and

Clear Channel Communications, Inc.

200 East Basse Road

San Antonio, Texas 78209

Attention: General Counsel

     with a copy to:

Ropes & Gray LLP

One International Place

Boston, MA 02110

Attention: Loretta Richard

or to such other address as any party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon receipt.

     15. Miscellaneous. No provisions of this Agreement may be amended, modified, or
waived unless such amendment or modification is agreed to in writing signed by Executive and by a
duly authorized officer of the Company, and such waiver is set forth in writing and signed by the
party to be charged. No waiver by either party hereto at any time of any breach by the other party
hereto of any condition or provision of this Agreement to be performed by such other party shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are not set forth
expressly in this Agreement. The respective rights and obligations of the parties hereunder shall
survive Executive’s termination of employment and the termination of this Agreement to the extent
necessary for the intended preservation of such rights and obligations. The validity,
interpretation, construction and performance of this Agreement shall be governed by the laws of the
State of Texas without regard to its conflicts of law principles.

     16. Validity. The invalidity or unenforceability of any provision or provisions of
this Agreement shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.

-16-

 

     17. Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original but all of which together will constitute one and the same
instrument.

     18. Entire Agreement. This Agreement sets forth the entire agreement of the parties
hereto in respect of the subject matter contained herein, and supersedes all prior agreements,
promises, covenants, arrangements, communications, representations or warranties, whether oral or
written, by any officer, employee or representative of any party hereto in respect of such subject
matter, including but not limited to the Existing Agreement, and excluding only any existing
obligations on the part of Executive with respect to Confidential Information, assignment of
intellectual property, non-competition and the like. Any prior agreement of the parties hereto in
respect of the subject matter contained herein is hereby terminated and cancelled.

     19. Withholding. All payments hereunder shall be subject to any required withholding
of federal, state and local taxes pursuant to any applicable law or regulation.

     20. Noncontravention. The Company represents that the Company is not prevented from
entering into or performing this Agreement by the terms of any law, order, rule or regulation, its
by-laws or declaration of trust, or any agreement to which it is a party, other than which would
not have a material adverse effect on the Company’s ability to enter into or perform this
Agreement.

     21. Section Headings. The section headings in this Agreement are for convenience of
reference only, and they form no part of this Agreement and shall not affect its interpretation.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above
written.

	 	 	 
	BT Triple Crown Merger Co., Inc.

By:
	 	 
	 
	 	 
	 

Name:

	 	 
	Title:
	 	 
	 
	 	 
	BT Triple Crown Capital Holdings III, Inc.
	 	 
	By:
	 	 
	 
	 	 
	 

Name:

	 	 
	Title:
	 	 
	 
	 	 
	 

L. Lowry Mays

	 	 

-17-

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     AGREEMENT, dated effective as of [CLOSING DATE], by and between BT Triple Crown Merger Co.,
Inc. (“MergerSub”, together with its successors, the “Company”), BT Triple Crown Capital Holdings
III, Inc. (“Holdings”) and [Mark/Randall] Mays (“Executive”).

     WHEREAS, Clear Channel Communications, Inc., a Texas corporation and Executive previously
entered into that certain Employment Agreement dated as of March 10, 2005 (the “Existing
Agreement”); and

     WHEREAS, Clear Channel Communications, Inc. has entered into an Agreement and Plan of Merger
dated as of November 16, 2006, as amended (the “Merger Agreement”) pursuant to which, on the terms
and subject to the conditions set forth therein, MergerSub shall merge within and into Clear
Channel Communications, Inc., with Clear Channel Communications, Inc. surviving such merger at and
after the Effective Time (as defined in the Merger Agreement), and Holdings shall, on the date of
consummation of the transactions contemplated under the Merger Agreement, be the ultimate parent
holding company of the Company; and

     WHEREAS, the Company and Executive desire to amend and restate the terms of the Existing
Agreement between the Company and Executive, to be effective as of the Effective Time.

     NOW, THEREFORE, in consideration of the premises and the mutual covenants set forth below, the
parties hereby amend and restate the Existing Agreement effective as of the Effective Time as
follows:

     1. Employment. The Company hereby agrees to continue to employ Executive as the
[Mark: Chief Executive Officer; Randall: President], and Executive hereby accepts such continued
employment, on the terms and conditions hereinafter set forth.

     2. Term. The period of employment of Executive by the Company under this Agreement
(the “Employment Period”) shall commence on the date upon which the Effective Time occurs (the
“Effective Date”) and shall have an original term of five (5) years, and shall be automatically
extended thereafter for successive terms of one year each, unless either party provides notice to
the other at least twelve months prior to the expiration of the original or any extension term that
the Agreement is not to be extended. The Employment Period may be sooner terminated by either
party in accordance with Section 6 of this Agreement.

     3. Position and Duties. During the Employment Period, Executive shall serve as [Mark:
Chief Executive Officer; Randall: President] of the Company, and shall report solely and directly
to the Board of Directors (the “Board”) of Holdings. Executive shall have those powers and duties
normally associated with the position of [Mark: Chief Executive Officer; Randall: President] of
entities comparable to the Company and such other powers and duties as may be prescribed by the
Board; provided, that such other powers and duties are consistent with Executive’s position as
[Mark: Chief Executive Officer; Randall: President.] Executive shall devote as much of his working
time, attention and energies during normal business hours (other

-1-

 

than absences due to illness or vacation) to satisfactorily perform his duties for the
Company. Notwithstanding the above, Executive shall be permitted, to the extent such activities do
not substantially interfere with the performance by Executive of his duties and responsibilities
hereunder or violate Section 11 hereof, to (i) manage Executive’s personal, financial and legal
affairs, (ii) serve on civic or charitable boards or committees or on the Board of Directors of
Live Nation Inc. and its committees (it being expressly understood and agreed that Executive’s
continuing to serve on any such boards and/or committees on which Executive is serving, or with
which Executive is otherwise associated, as of the Effective Date shall be deemed not to interfere
with the performance by Executive of his duties and responsibilities under this Agreement), and
(iii) deliver lectures or fulfill speaking engagements. During the Employment Period, for so long
as Executive remains an officer of the Company, (i) Executive shall also serve as a member of the
Board of the Company, and (ii) Executive shall also serve as [Mark: Chief Executive Officer;
Randall: President] of Holdings and as a member of the Board of Holdings.

     4. Place of Performance. The principal place of employment of Executive shall be at
the Company’s principal executive offices in San Antonio, Texas.

     5. Compensation and Related Matters.

     (a) Base Salary and Bonus. During the Employment Period, the Company shall pay
Executive a base salary at the rate of not less than [Mark: $[2006 Base salary] Randall:
$[2006 Base Salary] per year (“Base Salary”). Executive’s Base Salary shall be paid in
approximately equal installments in accordance with the Company’s customary payroll
practices. The Compensation Committee of the Board of Holdings (the “Committee”) shall
review Executive’s Base Salary for increase (but not decrease) no less frequently than
annually and consistent with the executive compensation practices and guidelines of the
Company and Holdings. If Executive’s Base Salary is increased by the Company, such
increased Base Salary shall then constitute the Base Salary for all purposes of this
Agreement. In addition to Base Salary, Executive shall be eligible to receive an annual
bonus (the “Performance Bonus”). Unless the Board of Holdings and Executive mutually agree
otherwise, the amount of the Performance Bonus shall be determined by the Board of Directors
of Holdings (which may act through its Compensation Committee) in its sole discretion,
provided, however, that in any year during the Employment Period in which the Company
achieves at least eighty percent (80%) of the budgeted OIBDAN for the given year (the
“Target OIBDAN”), as set forth in the Management Plan previously presented to the Sponsor
Group1 (as defined in the [___]) and consistent with the requirements of Section
162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), to the extent
applicable, such Performance Bonus shall be no less than [$___].2 The
Management Plan will be subject to equitable adjustment by the Compensation Committee of
Holdings to take into account material acquisitions, dispositions and other material
extraordinary events; provided, that the parties hereto will use their reasonable best
efforts to facilitate the payment of the bonuses hereunder on a basis that is consistent
with such payments qualifying for the performance-based compensation exception under Section
162(m) of the Code and the regulations thereunder. If the Company does not achieve the
Target OIBDAN in any given year, the amount of the Performance Bonus, if any, shall be
determined by the

 

			
	1	 	Presented on May 17, 2007.
	 
	2	 	Insert dollar amount of the bonus paid to the
Executive in respect of 2006.

-2-

 

Board of Holdings in its sole discretion. The Performance Bonus, if any, shall be
payable in one lump sum between January 1 and March 15 of the year following the year for
which the Performance Bonus was earned.

     (b) Expenses and Perquisites. The Company shall promptly reimburse Executive
for all reasonable business expenses upon the presentation of reasonably itemized statements
of such expenses, in accordance with the Company’s policies and procedures now in force or
as such policies and procedures may be modified generally with respect to senior executive
officers of the Company. In addition, during the Employment Period, Executive shall be
entitled to, at the sole expense of the Company:

	 	(i)	 	the use of an automobile appropriate to his
position and no less qualitative than the automobile provided to him
immediately prior to the date of this Agreement; and
	 
	 	(ii)	 	use of a Company-provided aircraft for personal
travel, in accordance with Company policy as in effect on November 16,
2006 (the “Aircraft Benefit”).

     (c) Vacation. Executive shall be entitled to the number of weeks of paid
vacation per year that he was eligible for immediately prior to the date of this Agreement,
but in no event less than four (4) weeks annually. Unused vacation may be carried forward
from year to year. Vacation shall otherwise be governed by the policies of the Company, as
in effect from time to time. In addition to vacation, Executive shall be entitled to the
number of sick days and personal days per year that other senior executive officers of the
Company with similar tenure are entitled to under the Company’s policies.

     (d) Services Furnished. During the Employment Period, the Company shall
furnish Executive with office space, stenographic and secretarial assistance and such other
facilities and services no less favorable than what he was receiving immediately prior to
the date of this Agreement or, if better, as provided to other senior executive officers of
the Company (other than the Chairman Emeritus).

     (e) Welfare, Pension and Incentive Benefit Plans. During the Employment
Period, subject to the terms of the applicable plan documents and generally applicable
Company policies, Executive (and his spouse and dependents to the extent provided therein)
shall be entitled to participate in and be covered under all the welfare benefit plans or
programs maintained by the Company from time to time for the benefit of its senior
executives (other than benefits maintained exclusively for the Chairman Emeritus),
including, without limitation, all medical, hospitalization, dental, disability, accidental
death and dismemberment and travel accident insurance plans and programs. During the
Employment Period, the Company shall provide to Executive (and his spouse and dependents to
the extent provided under the applicable plans or programs) the same type and substantially
equivalent levels of participation and employee benefits (other than severance pay plans
and, except with the express consent of the Board of Holdings, incentive bonus programs
other than as explicitly set forth in Section 5(a) hereof) as are being provided to other
senior executives (and their spouses and dependents to the extent provided under the
applicable plans or programs) on the Effective Date, subject to modifications affecting all
senior executive officers.

-3-

 

     (f) Equity Incentive Award. At or promptly following the Effective Time, the
Company will grant Executive an equity incentive award pursuant to a new equity incentive
plan substantially in the form of the draft Clear Channel Capital III, Inc. 2007 Equity
Incentive Plan attached hereto as Exhibit A and related restricted stock and stock
option award agreements in substantially the forms attached hereto as Exhibits B
and C, respectively. Executive shall not be eligible to receive any stock
options, restricted stock or other equity of the Company or Holdings, whether under an
equity incentive plan or otherwise, except as expressly provided for in this Agreement or as
expressly authorized for him individually by the Board of Holdings.

     (g) Equity Rollover and Purchased Equity.

	 	(i)	 	Effective as of the Effective Date, Executive
will exchange [___] shares of Company common stock previously issued
to him and the currently held options to acquire shares of Company
common stock (“Old Options”) that are identified on Exhibit D,
all on the terms and subject to the conditions of a Rollover Option
Agreement substantially in the form attached hereto as Exhibit
E-1 and the Restricted Stock Agreement substantially in the form
attached hereto as Exhibit E-2. The total value (based on,
with respect to shares of Company common stock, the Cash Consideration
(as defined under the Merger Agreement), and with respect to the Old
Options, the excess of the Cash Consideration over the per share
exercise price) by of all of the foregoing will not exceed $10 million.
	 
	 	(ii)	 	Executive may subscribe for a purchase of
$[___] in additional equity securities of the Company or of a holding
company Affiliate on the terms and subject to the conditions set forth
in Exhibit F.

     6. Termination. Executive’s employment hereunder may be terminated during the
Employment Period under the following circumstances:

     (a) Death. Executive’s employment hereunder shall terminate upon his death.

     (b) Disability. If, as a result of Executive’s incapacity due to physical or
mental illness, Executive shall have been substantially unable to perform his duties
hereunder notwithstanding the provision of reasonable accommodation for a period of six (6)
consecutive months, and within thirty (30) days after written Notice of Termination is given
after such six (6) month period Executive shall not have returned to the substantial
performance of his duties on a full-time basis, the Company shall have the right to
terminate Executive’s employment hereunder for “Disability”, and such termination in and of
itself shall not be, nor shall it be deemed to be, a breach of this Agreement.

     (c) Cause. The Company shall have the right to terminate Executive’s
employment for Cause by providing Executive with a written Notice of Termination, and such
termination in and of itself shall not be, nor shall it be deemed to be, a breach of this
Agreement. For purposes of this Agreement, “Cause” shall mean:

-4-

 

	 	(i)	 	Executive’s willful and continued failure to
perform his material duties with respect to the Company or its
Affiliates which, if curable, continues beyond ten business days after
a written demand for substantial performance is delivered to Executive
by the Company; or
	 
	 	(ii)	 	Willful or intentional engaging by Executive in
material misconduct that causes material and demonstrable injury,
monetarily or otherwise, to the Company, the Sponsor Group (as defined
in the [___]) or any of their respective Affiliates; or
	 
	 	(iii)	 	Executive’s conviction of, or a plea of nolo
contendre to, a crime constituting (A) a felony under the laws of the
United States or any state thereof; or (B) a misdemeanor involving
moral turpitude that causes material and demonstrable injury,
monetarily or otherwise, to the Company, the Sponsor Group or any of
their respective Affiliates; or
	 
	 	(iv)	 	Executive’s committing or engaging in any act
of fraud, embezzlement, theft or other act of dishonesty against the
Company or its Affiliates that causes material and demonstrable injury,
monetarily or otherwise, to the Company, the Sponsor Group or any of
their respective Affiliates; or
	 
	 	(v)	 	Executive’s breach of any provision of Section
11 hereof that causes material and demonstrable injury, monetarily or
otherwise, to the Company, the Sponsor Group or any of their respective
Affiliates.

Whether “Cause” exists shall be determined by at least a majority of the members of the Board of
the Company at a meeting of the Board called and held for such purpose, provided that at least a
majority of the members of the Board of Holdings has determined prior to such meeting that Cause
exists.

     (d) Good Reason. Executive may terminate his employment for “Good Reason” by
providing the Company with a written Notice of Termination. The following events, without
the written consent of Executive, shall constitute “Good Reason”:

	 	(i)	 	Reduction in Executive’s Base Salary or annual
incentive compensation opportunity, other than any isolated,
insubstantial and inadvertent failure by the Company that is not in bad
faith and is cured within ten (10) business days after Executive gives
the Company notice of such event; or
	 
	 	(ii)	 	Substantial diminution in Executive’s title,
duties and responsibilities, other than any isolated, insubstantial and
inadvertent failure by the Company that is not in bad faith and is
cured within ten (10) business days after Executive gives the Company
notice of such event; or

-5-

 

	 	(iii)	 	Failure by the Company to provide the Aircraft
Benefit or any material breach of its obligations to provide such
Benefit, which is other than insubstantial, inadvertent, not in bad
faith and is not repeated; or
	 
	 	(iv)	 	Transfer of Executive’s primary workplace
outside the city limits of San Antonio, Texas;

Executive expressly acknowledges and agrees that the Company’s provision of notice of
non-renewal of the Agreement pursuant to Section 2 hereof, alone or in combination with the
transition of Executive’s duties to another employee during the notice period, shall not
constitute Good Reason.

Executive expressly waives any rights he might otherwise have, under the Existing Agreement
or otherwise, to resign for Good Reason or otherwise receive any compensation in the nature
of severance or separation pay or benefits as a result of the transaction contemplated by
the Agreement and Plan of Merger by and among BT Triple Crown Merger Co., Inc., B Triple
Crown Finco, LLC, T Triple Crown Finco, LLC and Clear Channel Communications, Inc. dated as
of November 16, 2006, as amended on April 18, 2007 and May 17, 2007 (the “Transaction”).

     (e) Without Cause. The Company shall have the right to terminate Executive’s
employment hereunder without Cause by providing Executive with a Notice of Termination at
least thirty (30) days prior to such termination, and such termination shall not in and of
itself be, nor shall it be deemed to be, a breach of this Agreement. In the event of
termination pursuant to this Section 6(e), the Board of the Company may elect to waive the
period of notice, or any portion thereof, and, if the Board so elects, the Company will pay
Executive his Base Salary for the initial thirty (30) days of the notice period or for any
lesser remaining portion of such period, payable in accordance with the regular payroll
practices of the Company.

     (f) Without Good Reason. Executive shall have the right to terminate his
employment hereunder without Good Reason by providing the Company with a Notice of
Termination at least thirty (30) days prior to such termination, and such termination shall
not in and of itself be, nor shall it be deemed to be, a breach of this Agreement. In the
event of termination pursuant to this Section 6(f), the Board of the Company may elect to
waive the period of notice, or any portion thereof, and, if the Board so elects, the Company
will pay Executive his Base Salary for the initial thirty (30) days of the notice period or
for any lesser remaining portion of such period, payable in accordance with the regular
payroll practices of the Company.

     7. Termination Procedure.

     (a) Notice of Termination. Any termination of Executive’s employment by the
Company or by Executive during the Employment Period (other than termination pursuant to
Section 6(a)) shall be communicated by written Notice of Termination to the other party
hereto in accordance with Section 15. For purposes of this Agreement, a “Notice of
Termination” shall mean a notice which indicates the specific termination provision in this
Agreement relied upon, and sets forth in reasonable detail the facts and

-6-

 

circumstances claimed to provide a basis for termination of Executive’s employment
under the provision so indicated.

     (b) Date of Termination. “Date of Termination” shall mean (i) if Executive’s
employment is terminated by his death, the date of death, (ii) if Executive’s employment is
terminated pursuant to Section 6(b), thirty (30) days after Notice of Termination (provided
that Executive shall not have returned to the substantial performance of his duties on a
full-time basis during such thirty (30) day period), and (iii) if Executive’s employment is
terminated for any other reason, the date on which a Notice of Termination is given or any
later date set forth in such Notice of Termination.

     8. Compensation Upon Termination or During Disability. In the event Executive is
disabled or his employment terminates during the Employment Period, the Company shall provide
Executive with the payments and benefits set forth below; provided, however, that any obligation of
the Company to Executive under Section 8(a), other than for Final Compensation, is expressly
conditioned upon Executive signing and returning to the Company a timely and effective release of
claims substantially in the form attached hereto as Exhibit G (the “Executive Release of
Claims”). Following the Company’s receipt of a timely and effective Release of Claims, the Company
and Holdings shall execute a release of claims in favor of Executive substantially in the form
attached hereto as Exhibit H (the “Company Release of Claims”). The Executive Release of
Claims required for separation benefits in accordance with Section 8(a) creates legally binding
obligations on the part of Executive, and the Company and its Affiliates therefore advise Executive
and his beneficiary or legal representative, as applicable, to seek the advice of an attorney
before signing it.

     (a) Termination By the Company Without Cause or By Executive for Good Reason.
If Executive’s employment is terminated by the Company without Cause or by Executive for
Good Reason:

	 	(i)	 	the Company shall pay to Executive his Base
Salary, Bonus and unused vacation pay accrued or prorated through the
Date of Termination, and shall reimburse Executive pursuant to Section
5(b) for reasonable business expenses incurred but not paid prior to
such termination of employment (together, “Final Compensation”). The
Base Salary and vacation components of Final Compensation shall be paid
in a lump sum as soon as practicable following the Date of Termination,
but in no event later than two and a half months following the end of
the taxable year including the Date of Termination. The Bonus
component of Final Compensation shall be calculated by multiplying the
amount of the Performance Bonus (if any) Executive would have earned
had he remained employed for the full year in which the Date of
Termination occurs by a fraction, the numerator of which is the number
of days during such year that Executive was employed and the
denominator of which is 365, and shall be paid at the times bonuses for
the year in which the Date of Termination occurs are paid to executives
of the Company generally, but in no event later than two and a half
months following the end of the taxable year in which the Date of
Termination occurs;

-7-

 

	 	(ii)	 	provided Executive signs and returns a timely
and effective Release of Claims, the Company shall pay to Executive a
lump-sum cash payment equal to three (3) times the sum of (A)
Executive’s Base Salary and (B) the Bonus paid to Executive for the
year prior to the year in which termination occurs; and
	 
	 	(iii)	 	provided Executive signs and returns a timely
and effective Release of Claims, the Company shall maintain in full
force and effect, for the continued benefit of the Executive and his
eligible dependents, for a period of three (3) years following the Date
of Termination the medical and hospitalization insurance programs in
which the Executive and his dependents were participating immediately
prior to the Date of Termination, at the level in effect and upon
substantially the same terms and conditions (including without
limitation contributions required by Executive for such benefits) as
existed immediately prior to the Date of Termination; provided, that if
Executive or his dependents cannot continue to participate in the
Company plans and programs providing these benefits, the Company shall
arrange to provide Executive and his dependents with the economic
equivalent of such benefits which they otherwise would have been
entitled to receive under such plans and programs (the “Continued
Benefits”), provided, that such Continued Benefits shall terminate on
the date or dates Executive receives equivalent coverage and benefits,
without waiting period or pre-existing condition limitations, under the
plans and programs of a subsequent employer. Notwithstanding anything
to the contrary in this Section 8(a)(iii), the aggregate value (as the
same would be determined under Section 280G of the Code) of the
Continued Benefits shall in no event exceed Fifty Thousand Dollars
($50,000) (the “Aggregate Cap”); accordingly, the Company’s obligation
to provide the Continued Benefits shall cease once such value of the
Continued Benefits that have been provided to the Executive and/or his
dependents reaches the Aggregate Cap, even if such date occurs prior to
the three (3)-year anniversary of the Date of Termination.

     (b) Termination By the Company for Cause or By Executive Without Good Reason.
If Executive’s employment is terminated by the Company for Cause or by Executive other than
for Good Reason, the Company shall pay Executive the Final Compensation at the time and in
the manner set forth in Section 8(a)(i) hereof. The Company shall have no further
obligation to Executive upon such termination under this Agreement.

     (c) Disability. During any period that Executive fails to perform his duties
hereunder as a result of incapacity due to physical or mental illness (“Disability Period”),
Executive shall continue to receive his full Base Salary set forth in Section 5(a) until his
employment is terminated pursuant to Section 6(b), and the Company may, in its discretion,
designate another individual to act in Executive’s place, and such designation shall not
constitute Good Reason. In the event Executive’s employment is terminated for

-8-

 

Disability pursuant to Section 6(b), the Company shall pay to Executive the Final
Compensation at the time and in the manner set forth in Section 8(a)(i) hereof. The Company
shall have no further obligation to Executive upon such termination under this Agreement.

     (d) Death. If Executive’s employment is terminated by his death, the Company
shall pay the Final Compensation to Executive’s beneficiary, legal representatives or
estate, as the case may be, at the time and in the manner set forth in Section 8(a)(i)
hereof. The Company shall have no further obligation to Executive upon such termination
under the Agreement.

     (e) Timing of Payments. If at the time of Executive’s separation from service,
Executive is a “specified employee,” as hereinafter defined, any and all amounts payable
under this Section 8 in connection with such separation from service that constitute
deferred compensation subject to Section 409A of Code (“Section 409A”), as determined by the
Company in its sole discretion, and that would (but for this sentence) be payable within six
months following such separation from service, shall instead be paid on the date that
follows the date of such separation from service by six (6) months. For purposes of the
preceding sentence, “separation from service” shall be determined in a manner consistent
with subsection (a)(2)(A)(i) of Section 409A and the term “specified employee” shall mean an
individual determined by the Company to be a specified employee as defined in subsection
(a)(2)(B)(i) of Section 409A.

     9. Gross-Up Payment.

	 	(i)	 	Anything in this Agreement to the contrary
notwithstanding, in the event it shall be determined that any payment,
award, benefit or distribution (or any acceleration of any payment,
award, benefit or distribution) to or for the benefit of Executive as a
result of the Transaction (the “Payments”) would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code (the
“Code”), or any interest or penalties are incurred by Executive with
respect to such excise tax (such excise tax, together with any such
interest and penalties, are hereinafter collectively referred to as the
“Excise Tax”), then the Company shall pay to Executive an additional
payment (a “Gross-Up Payment”) in an amount such that after payment by
Executive of all taxes (including any Excise Tax) imposed upon the
Gross-Up Payment, Executive retains an amount of the Gross-Up Payment
equal to the sum of (x) the Excise Tax imposed upon the Payments and
(y) the product of any deductions disallowed because of the inclusion
of the Gross-Up Payment in Executive’s adjusted gross income and the
highest applicable marginal rate of federal income taxation for the
calendar year in which the Gross-Up Payment is to be made. For purposes
of determining the amount of the Gross-Up Payment, Executive shall be
deemed to (A) pay federal income taxes at the highest marginal rates of
federal income taxes at the highest marginal rate of taxation for the
calendar year in which the Gross-Up Payment is to be made, (B) pay
applicable state and local income taxes at the

-9-

 

	 	 	 	highest marginal rate of taxation for the calendar year in which the
Gross-Up Payment is to be made, net of the maximum reduction in
federal income taxes which could be obtained from deduction of such
state and local taxes and (C) have otherwise allowable deductions for
federal income tax purposes at least equal to those which could be
disallowed because of the inclusion of the Gross-Up Payment in
Executive’s adjusted gross income.
	 
	 	(ii)	 	Subject to the provisions of Section 9(e)(i),
all determinations required to be made under this Section 9(e),
including whether and when a Gross-Up Payment is required, the amount
of such Gross-Up Payment and the assumptions to be utilized in arriving
at such determinations, shall be made by a nationally recognized public
accounting firm that is selected by the Company (the “Accounting Firm”)
which shall provide detailed supporting calculations both to the
Company and Executive within fifteen (15) business days of the receipt
of notice from the Company or Executive that there has been a Payment,
or such earlier time as is requested by the Company or Executive
(collectively, the “Determination”). All fees and expenses of the
Accounting Firm shall be borne solely by the Company, and the Company
shall enter into any reasonable agreement requested by the Accounting
Firm in connection with the performance of the services hereunder. The
Gross-Up Payment under this Section 9(e) with respect to any Payments
made to Executive shall be made to the relevant tax authorities no
later than the date on which the Excise Tax on such Payments is due to
the relevant tax authorities. If the Accounting Firm determines that
no Excise Tax is payable by Executive, it shall furnish Executive with
a written opinion to such effect, and to the effect that failure to
report the Excise Tax, if any, on Executive’s applicable federal income
tax return should not result in the imposition of a negligence or
similar penalty.
	 
	 	(iii)	 	As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the
Determination, it is possible that Gross-Up Payments which will not
have been made by the Company should have been made (“Underpayment”) or
Gross-Up Payments are made by the Company which should not have been
made (“Overpayment”), consistent with the calculations required to be
made hereunder. In the event that Executive thereafter is required to
make payment of any Excise Tax or additional Excise Tax, the Accounting
Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment (together with interest at the rate provided
in Section 1274(b)(2)(B) of the Code) shall be promptly paid by the
Company to or for the benefit of Executive. In the event the amount of
the Gross-Up Payment exceeds the amount necessary to reimburse
Executive for his Excise Tax, the Accounting Firm shall determine the
amount of the Overpayment that has been made and any such Overpayment

-10-

 

	 	 	 	(together with interest at the rate provided in Section 1274(b)(2) of
the Code) shall be promptly paid by Executive (to the extent he has
received a refund if the applicable Excise Tax has been paid to the
Internal Revenue Service) to or for the benefit of the Company.
Executive shall cooperate, to the extent his expenses are reimbursed
by the Company, with any reasonable requests by the Company in
connection with any contest or disputes with the Internal Revenue
Service in connection with the Excise Tax.
	 
	 	(iv)	 	Executive expressly acknowledges and agrees
that the Gross-Up Payment is limited exclusively to Excise Tax that may
come due in connection with Payments to or for the benefit of Executive
as a result of the Transaction, and that Executive will not be entitled
to any Gross-Up Payments as a result of any change of control that may
occur following the Effective Date.

     10. Mitigation. Executive shall not be required to mitigate amounts payable under
this Agreement by seeking other employment or otherwise, and there shall be no offset against
amounts due Executive under this Agreement on account of subsequent employment except as
specifically provided herein. Additionally, amounts owed to Executive under this Agreement shall
not be offset by any claims the Company may have against Executive, and the Company’s obligation to
make the payments provided for in this Agreement and otherwise to perform its obligations hereunder
shall not be affected by any other circumstances, including, without limitation, any counterclaim,
recoupment, defense or other right which the Company may have against Executive or others.

     11. Restrictive Covenants.

     (a) Confidential Information.

	 	(i)	 	Executive acknowledges that the Company and its
Affiliates continually develop Confidential Information, that Executive
has developed and will develop Confidential Information for the Company
or its Affiliates, and that Executive has learned and will learn of
Confidential Information during the course of his employment.
Executive will comply with the policies and procedures of the Company
and its Affiliates for protecting Confidential Information. Executive
shall hold in a fiduciary capacity for the benefit of the Company all
trade secrets and Confidential Information, knowledge or data relating
to the Company, its Affiliates and their businesses and investments,
which shall have been obtained by Executive during Executive’s
employment by the Company and which is not generally available public
knowledge (other than by acts of Executive in violation of this
Agreement or by any other person having an obligation of
confidentiality to the Company or any of its Affiliates). Except as may
be required or appropriate in connection with carrying out his duties
under this Agreement, Executive shall not, without the prior written
consent of the Company or as may otherwise be required

-11-

 

	 	 	 	by law or any legal process, or as is necessary in connection with
any adversarial proceeding against the Company (in which case
Executive shall use his reasonable best efforts in cooperating with
the Company in obtaining a protective order against disclosure by a
court of competent jurisdiction), use, communicate or divulge any
such trade secrets, Confidential Information, knowledge or data to
anyone other than the Company and those designated by the Company or
on behalf of the Company in the furtherance of its business.
Executive understands that this restriction shall continue to apply
after his employment terminates, regardless of the reason for such
termination.
	 
	 	 	 	For purposes of this Agreement, “Confidential Information” shall mean
any and all information of the Company and its Affiliates that is
not generally known by those with whom the Company or any of its
Affiliates competes or does business, or with whom the Company or any
of its Affiliates plans to compete or do business, and any and all
information, publicly known in whole or in part or not, which, if
disclosed by the Company or any of its Affiliates, would assist in
competition against them. Confidential Information includes without
limitation such information relating to (i) the development,
research, testing, manufacturing, marketing and financial activities
of the Company and its Affiliates, (ii) the costs, sources of supply,
financial performance and strategic plans of the Company and its
Affiliates, (iii) the identity and special needs of the customers of
the Company and its Affiliates and (iv) the people and
organizations with whom the Company and its Affiliates have business
relationships and the nature and substance of those relationships.
Confidential Information also includes any information that the
Company or any of its Affiliates has received, or may receive
hereafter, belonging to customers or others with any understanding,
express or implied, that the information would not be disclosed to
others.
	 
	 	 	 	For purposes of this Agreement, “Affiliates” shall mean all persons
and entities directly or indirectly controlling, controlled by or
under common control with the Company, where control may be by
management authority, contract or equity interest. For the avoidance
of doubt, Affiliates includes Holdings.
	 
	 	(ii)	 	All documents, records, tapes and other media
of every kind and description relating to the business, present or
otherwise, of the Company or its Affiliates, and any copies, in whole
or in part, thereof (the “Documents”), whether or not prepared by
Executive, shall be the sole and exclusive property of the Company and
its Affiliates. Executive shall safeguard all Documents and shall
surrender to the Company at the time his employment terminates, or at
such earlier time or times as the Board of the Company or

-12-

 

	 	 	 	Holdings or its designee may specify, all Documents then in
Executive’s possession or control.

     (b) Restricted Activities. Executive hereby agrees that some restrictions on
his activities during and after his employment are necessary to protect the goodwill, trade
secrets, Confidential Information and other legitimate interests of the Company and its
Affiliates. In consideration of Executive’s employment hereunder, and the Company’s
agreement to grant Executive access to trade secrets and other Confidential Information of
the Company and its Affiliates and to their customers, and in view of the confidential
position to be held by Executive hereunder, Executive agrees as follows:

	 	(i)	 	Non-Solicitation. During the
Employment Period and during the two year period immediately following
termination of the Employment Period (the “Restricted Period”),
Executive shall not, directly or indirectly: (A) hire, solicit for
hiring or assist in any way in the hiring of any employee or
independent contractor of the Company or any of its Affiliates, or
induce or otherwise attempt to influence any employee or independent
contractor to terminate or diminish such employment or contractor
relationship or to become employed by any other radio broadcasting
station or any other entity engaged in the radio business, the
television business or in any other business in which the Company or
any of its Affiliates is engaged (which, for the avoidance of doubt,
includes without limitation the business of providing clients with
advertising opportunities through billboards, street furniture
displays, transit displays and other out-of-home advertising displays,
such as wallscapes, spectaculars and mall displays (the “Outdoor
Business”)), or (B) solicit or encourage any customer of the Company or
any of its Affiliates to terminate or diminish its relationship with
them, or seek to persuade any such customer or prospective customer to
conduct with anyone else any business or activity which such customer
or prospective customer conducts or could conduct with the Company or
any of its Affiliates. For purposes of this Agreement, an “employee”
of the Company or any of its Affiliates is any person who was such at
any time within the preceding two years; a “customer” of the Company or
any of its Affiliates is any person or entity who is or has been a
customer at any time within the preceding two years; and a “prospective
customer” is any person or entity whose business has been solicited on
behalf of the Company or any of its Affiliates at any time within the
preceding two years, other than by form letter, blanket mailing or
published advertisement.
	 
	 	(ii)	 	Non-Competition. During the Restricted
Period, Executive shall not, directly or indirectly, whether as owner,
partner, investor, consultant, agent, employee, co-venturer or
otherwise, compete with the Company or any of its Affiliates within the
United States or anywhere else in the world where the Company or any of
its Affiliates does business, or undertake any planning for any

-13-

 

	 	 	 	business competitive with the Company or any of its Affiliates.
Specifically, but without limiting the foregoing, Executive agrees
not to engage in any manner in any activity that is directly or
indirectly competitive or potentially competitive with the business
of the Company or any of its Affiliates as conducted or under
consideration at any time during Executive’s employment, and
Executive further agrees not to work for or provide services to, in
any capacity, whether as an employee, independent contractor or
otherwise, whether with or without compensation, any person or entity
that is engaged in any business that is competitive with the business
of the Company or any of its Affiliates for which the Executive has
provided services, as conducted or in planning during his employment.
For the purposes of this Section 11, the business of the Company and
its Affiliates shall include the radio and television businesses, the
Outdoor Business and any other business that was conducted or in
planning during the Executive’s employment. The foregoing, however,
shall not prevent Executive’s direct or beneficial ownership of up to
five percent (5%) of the equity securities of any entity, whether or
not in the same or competing business.

     (c) Assignment of Rights to Intellectual Property.

	 	(i)	 	Executive shall promptly and fully disclose all
Intellectual Property to the Company. Executive hereby assigns and
agrees to assign to the Company (or as otherwise directed by the
Company) Executive’s full right, title and interest in and to all
Intellectual Property. Executive agrees to execute any and all
applications for domestic and foreign patents, copyrights or other
proprietary rights and to do such other acts (including without
limitation the execution and delivery of instruments of further
assurance or confirmation) requested by the Company to assign the
Intellectual Property to the Company and to permit the Company to
enforce any patents, copyrights or other proprietary rights to the
Intellectual Property. Executive will not charge the Company for time
spent in complying with these obligations. All copyrightable works
that Executive creates shall be considered “work made for hire” and
shall, upon creation, be owned exclusively by the Company.
	 
	 	(ii)	 	For purposes of this Agreement, “Intellectual
Property” means inventions, discoveries, developments, methods,
processes, compositions, works, concepts and ideas (whether or not
patentable or copyrightable or constituting trade secrets) conceived,
made, created, developed or reduced to practice by Executive (whether
alone or with others, whether or not during normal business hours or on
or off Company premises) during Executive’s employment that relate to
either the Products or any prospective activity of the Company or any
of its Affiliates or that

-14-

 

	 	 	 	make use of Confidential Information or any of the equipment or
facilities of the Company or any of its Affiliates; and “Products”
means all products planned, researched, developed, tested,
manufactured, sold, licensed, leased or otherwise distributed or put
into use by the Company or any of its Affiliates, together with all
services provided or planned by the Company or any of its Affiliates,
during Executive’s employment.

     (d) Conflict of Interest. Executive agrees that, during his employment with
the Company, he will not undertake any outside activity, whether or not competitive with the
business of the Company or its Affiliates, that could reasonably give rise to a conflict of
interest or otherwise interfere with his duties and obligations to the Company or any of its
Affiliates.

     (e) Modification of Covenants. The parties hereby acknowledge that the
restrictions in this Section 11 have been specifically negotiated and agreed to by the
parties hereto, and are limited only to those restrictions necessary to protect the Company
and its Affiliates from unfair competition. Executive acknowledges that he has carefully
read and considered all the terms and conditions of this Agreement, including the
restrictions in Section 11 hereof, and agrees without reservation that each of the
restraints contained herein is necessary for the reasonable and proper protection of the
goodwill, trade secrets, Confidential Information and other legitimate interests of the
Company and its Affiliates; and that each and every one of those restraints is reasonable in
respect to subject matter, length of time and geographic area. Executive acknowledges that
the Company operates in major, medium and small-sized markets throughout the United States
and many foreign countries, that the effect of Section 11(b) may be to prevent him from
working in a competitive business after his termination of employment hereunder, and that
these restraints, individually or in the aggregate, will not prevent him from obtaining
other suitable employment during the period in which he is bound by such restraints. The
parties hereby agree that if the scope or enforceability of any provision, paragraph or
subparagraph of this Section 11 is in any way disputed at any time, and should a court find
that such restrictions are overly broad, the court shall modify and enforce the covenant to
permit its enforcement to the maximum extent permitted by law. Each provision, paragraph
and subparagraph of this Section 11 is separable from every other provision, paragraph, and
subparagraph, and constitutes a separate and distinct covenant.

     (f) Remedies. Executive hereby expressly acknowledges that any breach or
threatened breach by Executive of any of the terms set forth in Section 11 of this Agreement
would result in significant, irreparable and continuing injury to the Company, the monetary
value of which would be difficult to establish or measure. Therefore, Executive agrees that,
in addition to any other remedies available to it, the Company shall be entitled to
preliminary and permanent injunctive relief in a court of appropriate jurisdiction against
any breach or threatened breach, without having to post bond, as well as the recovery of all
reasonable attorney’s fees expended in enforcing its rights hereunder.

-15-

 

     12. Indemnification.

     (a) General. The Company agrees that if Executive is made a party or is
threatened to be made a party to any action, suit or proceeding, whether civil, criminal,
administrative or investigative (a “Proceeding”), by reason of the fact that Executive is or
was a trustee, director or officer of the Company, Holdings, or any subsidiary thereof, or
is or was serving at the request of the Company or any subsidiary as a trustee, director,
officer, member, employee or agent of another corporation or a partnership, joint venture,
trust or other enterprise, including, without limitation, service with respect to employee
benefit plans, whether or not the basis of such Proceeding is alleged action in an official
capacity as a trustee, director, officer, member, employee or agent while serving as a
trustee, director, officer, member, employee or agent, Executive shall be indemnified and
held harmless by the Company to the fullest extent authorized by Texas law, as the same
exists or may hereafter be amended, against all Expenses incurred or suffered by Executive
in connection therewith, and such indemnification shall continue as to Executive even if
Executive has ceased to be an officer, director, trustee or agent, or is no longer employed
by the Company, and shall inure to the benefit of his heirs, executors and administrators.

     (b) Expenses. As used in this Agreement, the term “Expenses” shall include,
without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes,
settlements, costs, attorneys’ fees, accountants’ fees, and disbursements and costs of
attachment or similar bonds, investigations, and any expenses of establishing a right to
indemnification under this Agreement.

     (c) Enforcement. If a valid claim or request under this Agreement is not paid
by the Company or on its behalf within thirty (30) days after a written claim or request has
been received by the Company, Executive may at any time thereafter bring suit against the
Company to recover the unpaid amount of the claim or request and, if successful in whole or
in part, Executive shall be further entitled to be paid the expenses of prosecuting such
suit. All obligations for indemnification hereunder shall be subject to, and paid in
accordance with, applicable Texas law.

     (d) Partial Indemnification. If Executive is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of any Expenses, but
not, however, for the total amount thereof, the Company shall nevertheless indemnify
Executive for the portion of such Expenses to which Executive is entitled.

     (e) Advances of Expenses. Expenses incurred by Executive in connection with
any Proceeding shall be paid by the Company in advance upon request of Executive that the
Company pay such Expenses; but, only in the event that Executive shall have delivered in
writing to the Company (i) an undertaking to reimburse the Company for Expenses with respect
to which Executive is not entitled to indemnification and (ii) an affirmation of his good
faith belief that the standard of conduct necessary for indemnification by the Company has
been met.

     (f) Notice of Claim. Executive shall give to the Company notice of any claim
made against him for which indemnification will or could be sought under this Agreement. In
addition, Executive shall give the Company such information and

-16-

 

cooperation as it may reasonably require and as shall be within Executive’s power and
at such times and places as are mutually convenient for Executive and the Company.

     (g) Defense of Claim. With respect to any Proceeding as to which Executive
notifies the Company of the commencement thereof:

	 	(i)	 	The Company will be entitled to participate
therein at its own expense; and
	 
	 	(ii)	 	Except as otherwise provided below, to the
extent that it may wish, the Company will be entitled to assume the
defense thereof, with counsel reasonably satisfactory to Executive,
which in the Company’s sole discretion may be regular counsel to the
Company and may be counsel to other officers and directors of the
Company or any subsidiary. Executive shall also have the right to
employ his own counsel in such action, suit or proceeding if he
reasonably concludes that failure to do so would involve a conflict of
interest between the Company and Executive, and, under such
circumstances, the fees and expenses of such counsel shall be at the
expense of the Company.
	 
	 	(iii)	 	The Company shall not be liable to indemnify
Executive under this Agreement for any amounts paid in settlement of
any action or claim effected without its written consent. The Company
shall not settle any action or claim in any manner which would impose
any penalty or limitation on Executive without Executive’s written
consent. Neither the Company nor Executive will unreasonably withhold
or delay their consent to any proposed settlement.

     (h) Non-exclusivity. The right to indemnification and the payment of expenses
incurred in defending a Proceeding in advance of its final disposition conferred in this
Section 12 shall not be exclusive of any other right which Executive may have or hereafter
may acquire under any statute, provision of the declaration of trust or certificate of
incorporation or by-laws of the Company, Holdings or any subsidiary, agreement, vote of
shareholders or disinterested directors or trustees or otherwise.

     13. Arbitration. Except as provided for in Section 11 of this Agreement, if any
contest or dispute arises between the parties with respect to this Agreement, such contest or
dispute shall be submitted to binding arbitration for resolution in San Antonio, Texas in
accordance with the rules and procedures of the Employment Dispute Resolution Rules of the American
Arbitration Association then in effect. The decision of the appointed arbitrator shall be final and
binding on both parties, and any court of competent jurisdiction may enter judgment upon the award.
The losing party shall pay all expenses relating to such arbitration, including, but not limited
to, the prevailing party’s legal fees and expenses.

     14. Successors; Binding Agreement.

     (a) Company’s Successors. No rights or obligations of the Company under this
Agreement may be assigned or transferred, except that the Company will require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to

-17-

 

all or substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same extent that
the Company would be required to perform it if no such succession had taken place. As used
in this Agreement, “Company” shall mean the Company as hereinabove defined and any successor
to its business and/or assets (by merger, purchase or otherwise) which executes and delivers
the agreement provided for in this Section 14 or which otherwise becomes bound by all the
terms and provisions of this Agreement by operation of law.

     (b) Executive’s Successors. No rights or obligations of Executive under this
Agreement may be assigned or transferred by Executive other than his right to payments or
benefits hereunder, which may be transferred only by will or the laws of descent and
distribution. Upon Executive’s death, this Agreement and all rights of Executive hereunder
shall inure to the benefit of and be enforceable by Executive’s beneficiary or
beneficiaries, personal or legal representatives, or estate, to the extent any such person
succeeds to Executive’s interests under this Agreement. Executive shall be entitled to
select and change a beneficiary or beneficiaries to receive any benefit or compensation
payable hereunder following Executive’s death by giving the Company written notice thereof.
In the event of Executive’s death or a judicial determination of his incompetence, reference
in this Agreement to Executive shall be deemed, where appropriate, to refer to his
beneficiary(ies), estate or other legal representative(s). If Executive should die following
his Date of Termination while any amounts would still be payable to him hereunder if he had
continued to live, all such amounts unless otherwise provided herein shall be paid in
accordance with the terms of this Agreement to such person or persons so designated in
writing by Executive, or otherwise to his legal representatives or estate.

     15. Notice. For the purposes of this Agreement, notices, demands and all other
communications provided for in this Agreement shall be in writing and shall be deemed to have been
duly given when delivered either personally or by United States certified or registered mail,
return receipt requested, postage prepaid, addressed as follows:

     If to Executive:

[Mark/Randall] Mays

200 East Basse Road

San Antonio, Texas 78209

     with a copy to:

Simpson, Thacher & Bartlett LLP

425 Lexington Avenue

New York, New York 10017

Attn: Andrea K. Wahlquist

     If to the Company:

BT Triple Crown Capital Holdings III, Inc.

200 East Basse Road

San Antonio, Texas 78209

-18-

 

Attention: Secretary

     and

Clear Channel Communications, Inc.

200 East Basse Road

San Antonio, Texas 78209

Attention: General Counsel

     with a copy to:

Ropes & Gray LLP

One International Place

Boston, MA 02110

Attention: Loretta Richard

or to such other address as any party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon receipt.

     16. Miscellaneous. No provisions of this Agreement may be amended, modified, or
waived unless such amendment or modification is agreed to in writing signed by Executive and by a
duly authorized officer of the Company, and such waiver is set forth in writing and signed by the
party to be charged. No waiver by either party hereto at any time of any breach by the other party
hereto of any condition or provision of this Agreement to be performed by such other party shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are not set forth
expressly in this Agreement. The respective rights and obligations of the parties hereunder shall
survive Executive’s termination of employment and the termination of this Agreement to the extent
necessary for the intended preservation of such rights and obligations. The validity,
interpretation, construction and performance of this Agreement shall be governed by the laws of the
State of Texas without regard to its conflicts of law principles.

     17. Validity. The invalidity or unenforceability of any provision or provisions of
this Agreement shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.

     18. Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original but all of which together will constitute one and the same
instrument.

     19. Entire Agreement. This Agreement sets forth the entire agreement of the parties
hereto in respect of the subject matter contained herein, and supersedes all prior agreements,
promises, covenants, arrangements, communications, representations or warranties, whether oral or
written, by any officer, employee or representative of any party hereto in respect of such subject
matter, including but not limited to the Existing Agreement, and excluding only any existing
obligations on the part of Executive with respect to Confidential Information, assignment of
intellectual property, non-competition and the like. Any prior agreement of the

-19-

 

parties hereto in respect of the subject matter contained herein is hereby terminated and
cancelled.

     20. Taxes. All payments hereunder shall be subject to any required withholding of
federal, state and local taxes pursuant to any applicable law or regulation. The Company,
Holdings, Sponsor Group and Executive shall each use reasonable best efforts to minimize all taxes
that may be due in connection with any award or payment made pursuant to this Agreement, including
in connection with the Restricted Stock Award; provided, that Executive shall only be required to
use such reasonable best efforts to the extent that Executive will not be economically
disadvantaged as a result of such efforts.

     21. Noncontravention. The Company represents that the Company is not prevented from
entering into or performing this Agreement by the terms of any law, order, rule or regulation, its
by-laws or declaration of trust, or any agreement to which it is a party, other than which would
not have a material adverse effect on the Company’s ability to enter into or perform this
Agreement.

     22. Section Headings. The section headings in this Agreement are for convenience of
reference only, and they form no part of this Agreement and shall not affect its interpretation.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above
written.

	 	 	 
	BT Triple Crown Merger Co., Inc.

By:
	 	 
	 
	 	 
	 

Name:

	 	 
	Title:
	 	 
	 
	 	 
	BT Triple Crown Capital Holdings III, Inc.

By:
	 	 
	 
	 	 
	 

Name:

	 	 
	Title:
	 	 
	 
	 	 
	 

[Mark/Randall] Mays

	 	 

-20-

 

EXHIBIT G TO MARK/RANDALL MAYS AGREEMENT

EXHIBIT A TO LOWRY MAYS AGREEMENT

RELEASE OF CLAIMS

     FOR AND IN CONSIDERATION OF the benefits to be provided me in connection with the termination
of my employment, as set forth in the employment agreement between me, BT Triple Crown Merger Co.,
Inc., and BT Triple Crown Capital Holdings III, Inc. effective as of [CLOSING DATE] (the
“Agreement”), which are conditioned on my signing this Release of Claims and to which I am not
otherwise entitled, and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, I, on my own behalf and on behalf of my heirs, executors,
administrators, beneficiaries, representatives and assigns, and all others connected with or
claiming through me, hereby release and forever discharge BT Triple Crown Merger Co., Inc., its
successor Clear Channel Communications, Inc., BT Triple Crown Capital Holdings III, Inc., and all
of their respective subsidiaries and other affiliates, past, present and future officers,
directors, trustees, shareholders, employees, agents, general and limited partners, members,
managers, joint venturers, representatives, successors and assigns, and all others connected with
any of them, all of the foregoing both individually and in their official capacities, from any and
all causes of action, rights or claims of any type or description, known or unknown, which I have
had in the past, now have, or might now have, through the date of my signing of this Release of
Claims, in any way resulting from, arising out of or connected with my employment by the Company or
any of its subsidiaries or other affiliates or the termination of that employment or pursuant to
any federal, state or local law, regulation or other requirement (including without limitation
Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans
with Disabilities Act, and the fair employment practices laws of the state or states in which I
have been employed by the Company or any of its subsidiaries or other affiliates, each as amended
from time to time).

Excluded from the scope of this Release of Claims is (i) any claim arising under the terms of the
Agreement after the effective date of this Release of Claims, (ii) any right of indemnification or
contribution that I have pursuant to the Articles of Incorporation or By-Laws of the Company or any
of its subsidiaries or other affiliates, and (iii) any claims under any of the equity incentive
plan and equity-based award agreements referenced in the Agreement with respect to any securities
(including shares, options, and any other equity-based rights) that I continue to hold after I sign
this Release of Claims.

     In signing this Release of Claims, I acknowledge my understanding that I may not sign it prior to
the termination of my employment, but that I may consider the terms of this Release of Claims for
up to twenty-one (21) days (or such longer period as the Company

1

 

may specify) from the later of the
date my employment with the Company terminates or the date I receive this Release of Claims. I
also acknowledge that I am advised by the
Company and its subsidiaries and other affiliates to seek the advice of an attorney prior to
signing this Release of Claims; that I have had sufficient time to consider this Release of Claims
and to consult with an attorney, if I wished to do so, or to consult with any other person of my
choosing before signing; and that I am signing this Release of Claims voluntarily and with a full
understanding of its terms.

I further acknowledge that, in signing this Release of Claims, I have not relied on any promises or
representations, express or implied, that are not set forth expressly in the Agreement. I
understand that I may revoke this Release of Claims at any time within seven (7) days of the date
of my signing by written notice to the Chairman of the Board of Directors of the Company and that
this Release of Claims will take effect only upon the expiration of such seven-day revocation
period and only if I have not timely revoked it.

Intending to be legally bound, I have signed this Release of Claims under seal as of the date
written below.

	 	 	 	 	 
	Signature:
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 
	Name (please print):
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 
	Date Signed:
	 	 	 	 
	 

	 	 

	 	 

2

 

EXHIBIT H TO MARK/RANDALL MAYS AGREEMENT

EXHIBIT B TO LOWRY MAYS AGREEMENT

RELEASE OF CLAIMS

     FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which is hereby
acknowledged, and as required by the agreement between BT Triple Crown Merger Co., Inc., BT Triple
Crown Capital Holdings III, Inc. and [EXECUTIVE] effective as of [CLOSING DATE] (the “Agreement”),
BT Triple Crown Merger Co., Inc., its successor Clear Channel Communications, Inc. (the “Company”),
and BT Triple Crown Capital Holdings III, Inc., on their own behalf and on behalf of their
predecessors, affiliates and successors, and each of their past, present, and future officers,
directors, employees, representatives, attorneys, insurers, agents and assigns, individually and in
their official capacities, hereby release and forever discharge [EXECUTIVE] from any and all causes
of action, rights or claims of any type or description, known or unknown, which they have had in
the past, now have, or might now have, through the date of signing of this Release of Claims, in
any way resulting from, arising out of or connected with Executive’s employment by the Company or
any of its subsidiaries or other affiliates or the termination of that employment or pursuant to
any federal, state or local law, regulation or other requirements, including without limitation
those arising under common law.

Excluded from the scope of this Release of Claims is (i) any claim arising after the effective date
of this Release of Claims; and (ii) any claims relating to Executive’s commission of fraud,
criminal acts, or other substantial, willful and intentional misconduct related to the Executive’s
employment with the Company or any of its affiliates.

Intending to be legally bound, the parties below have signed this Release of Claims under seal as
of the date written below.

	 	 	 
	[BT Triple Crown Merger Co., Inc./Clear Channel Communications, Inc.]
	By:
	 	 
	 
	 	 
	 

Name:

	 	 
	Title:
	 	 
	 
	 	 
	BT Triple Crown Capital Holdings III, Inc.
	By:
	 	 
	 
	 	 
	 

Name:

	 	 
	Title:
	 	 

1

 

CLEAR CHANNEL

2007 EXECUTIVE INCENTIVE PLAN

1. DEFINED TERM

     Exhibit A, which is incorporated by reference, defines the terms used in the Plan and sets
forth certain operational rules related to those terms.

2. PURPOSE

     The Plan has been established to advance the interests of the Company and its Affiliates by
providing for the grant to Participants of Stock-based and other incentive Awards. Awards under
the Plan are intended to align the incentives of the Company’s executives and investors and to
improve the performance of the Company. Unless the Administrator determines otherwise, Awards to
be granted under this Plan are expected to be substantially in the form attached hereto as Exhibit
B-1 or B-2; provided, that all Rollover Option Agreements shall be substantially in the form
attached hereto as Exhibit C and all Restricted Stock Agreements shall be substantially in the form
attached hereto as Exhibit D, in each case unless the Administrator determines otherwise.

3. ADMINISTRATION

     The Administrator has discretionary authority, subject only to the express provisions of the
Plan and the Award Agreements, to interpret the Plan; determine eligibility for and grant Awards;
determine, modify or waive the terms and conditions of any Award; prescribe forms, rules and
procedures; and otherwise do all things necessary to carry out the purposes of the Plan. In the
case of any Award intended to be eligible for the performance-based compensation exception under
Section 162(m) of the Code, the Administrator will exercise its discretion consistent with
qualifying the Award for that exception. Except as otherwise provided by the express terms of an
Award Agreement, all determinations of the Administrator made under the Plan will be conclusive and
will bind all parties.

4. LIMITS ON AWARDS UNDER THE PLAN

     (a) Number
of Shares. A maximum of ___ Shares may be delivered in satisfaction of
Awards under the Plan. The number of Shares delivered in satisfaction of Awards shall, for
purposes of the preceding sentence, be determined net of Shares (i) withheld by the Company in
payment of the exercise price of the Award or in satisfaction of tax withholding requirements with
respect to the Award, (ii) awarded under the Plan as Restricted Stock, but thereafter forfeited,
and (iii) made subject to an award that is exercised or satisfied, or that terminates or expires,
without the delivery of such shares. The limits set forth in this Section 4(a) shall be construed
to comply with Section 422 of the Code and the regulations thereunder. To the extent consistent
with the requirements of Section 422 of the Code and regulations thereunder and with other
applicable legal requirements (including applicable stock exchange requirements), Stock issued
under awards of an acquired company that are converted, replaced or adjusted in connection with the
acquisition shall not reduce the number of Shares available for Awards under the Plan.

-1-

 

     (b) Type of Shares. Stock delivered under the Plan may be authorized but unissued
Stock or previously issued Stock acquired by the Company or any of its subsidiaries. No fractional
Shares will be delivered under the Plan.

     (c) Section 162(m) Limits. The maximum number of Shares for which Stock Options may
be granted to any person in any calendar year and the maximum number of Shares subject to SARs
granted to any person in any calendar year will each be                     . The maximum number of Shares
subject to other Awards granted to any person in any calendar year will be                      Shares.
The foregoing provisions will be construed in a manner consistent with Section 162(m) of the Code.

5. ELIGIBILITY AND PARTICIPATION

     The Administrator will select Participants from among those key Employees and directors of,
and consultants and advisors to, the Company or its Affiliates who, in the opinion of the
Administrator, are in a position to make a significant contribution to the success of the Company
and its Affiliates; provided, that, subject to such express exceptions, if any, as the
Administrator may establish, eligibility shall be further limited to those persons as to whom the
use of a Form S-8 registration statement is permissible. Within 10 business days following the
Closing Date (as defined in the Merger Agreement dated as of November 16, 2006, as amended, among
Clear Channel Communications, Inc. and the other parties thereto), the Company shall file a Form
S-8 registration statement with respect to all Shares available for issuance under this Plan. The
Company shall use commercially reasonable efforts to maintain such Form S-8 while Awards granted
hereunder remain outstanding; provided however that nothing herein shall prevent the Company from
de-registering the Shares under the Plan if and to the extent they are no longer subject to the
reporting requirements of the Securities Exchange Act of 1934, as amended. Eligibility for ISOs is
limited to employees of the Company or of a “parent corporation” or “subsidiary corporation” of the
Company as those terms are defined in Section 424 of the Code.

6. RULES APPLICABLE TO AWARDS

     (a) All Awards

          (1) Award Provisions. The Administrator will determine the terms of all Awards,
subject to the limitations provided herein, and shall furnish to each Participant an Award
Agreement setting forth the terms applicable to the Participant’s Award. By entering into an Award
Agreement, the Participant agrees to the terms of the Award and of the Plan, to the extent not
inconsistent with the express terms of the Award Agreement. Notwithstanding any provision of this
Plan to the contrary, awards of an acquired company that are converted, replaced or adjusted in
connection with the acquisition may contain terms and conditions that are inconsistent with the
terms and conditions specified herein, as determined by the Administrator.

          (2) Transferability. Neither ISOs, nor, except as the Administrator otherwise
expressly provides, other Awards may be transferred other than by will or by the laws of descent
and distribution, and during a Participant’s lifetime ISOs (and, except as the Administrator
otherwise expressly provides, other non-transferable Awards requiring exercise) may be
exercised only by the Participant.

-2-

 

          (3) Vesting, Etc. The Administrator may determine the time or times at which an Award
will vest or become exercisable and the terms on which an Award requiring exercise will remain
exercisable. Without limiting the foregoing, the Administrator may at any time accelerate the
vesting or exercisability of an Award, regardless of any adverse or potentially adverse tax
consequences resulting from such acceleration. Unless expressly provided otherwise by the
Administrator or an Award Agreement, automatically and immediately upon the cessation of
Employment, all outstanding Restricted Stock will be forfeited and all Awards requiring exercise
will cease to be exercisable and will terminate, except that:

     (A) subject to (B) and (C) below, all Stock Options and other Awards requiring exercise
held by the Participant or the Participant’s permitted transferees, if any, immediately
prior to the cessation of the Participant’s Employment, to the extent then exercisable, will
remain exercisable for the lesser of (i) a period of 90 days or (ii) the period ending on
the latest date on which such Stock Option or SAR could have been exercised without regard
to this Section 6(a)(4), and will thereupon terminate;

     (B) all Stock Options and other Awards requiring exercise held by a Participant or the
Participant’s permitted transferees, if any, immediately prior to the termination of the
Participant’s Employment by reason of death or disability, to the extent then exercisable,
will remain exercisable for the lesser of (i) the one year period ending with the first
anniversary of the Participant’s death or disability, as the case may be, or (ii) the period
ending on the latest date on which such Stock Option or SAR could have been exercised
without regard to this Section 6(a)(3), and will thereupon terminate; and

     (C) all Stock Options and other Awards requiring exercise held by a Participant or the
Participant’s permitted transferees, if any, immediately prior to the cessation of the
Participant’s Employment will immediately terminate upon such cessation if such cessation of
Employment has resulted in connection with an act or failure to act constituting Cause.

          (4) Taxes. The Administrator will make such provision for the withholding of taxes as
it deems necessary. Except as otherwise provided in an Award Agreement, the Administrator may, but
need not, hold back Shares from an Award or permit a Participant to tender previously owned Shares
in satisfaction of tax withholding requirements (but not in excess of the applicable minimum
statutory withholding rate), using the Fair Market Value of Stock on the date of exercise to
determine the number of shares so withheld or tendered. 

          (5) Dividend Equivalents, Etc. Except as otherwise provided in an Award Agreement,
the Administrator may provide for the payment of amounts in lieu of cash dividends or other cash
distributions with respect to Stock subject to an Award.

          (6) Rights Limited. Nothing in the Plan will be construed as giving any person the
right to continued Employment with the Company or its Affiliates, or any rights as a stockholder
except as to shares of Stock actually issued under the Plan. The loss of potential appreciation in
Awards will not constitute an element of damages in the event of termination of

-3-

 

Employment for any reason, even if the termination is in violation of an obligation of the
Company or its Affiliate to the Participant.

          (7) Section 162(m). This Section 6(a)(7) applies to any Performance Award intended to
qualify as performance-based for the purposes of Section 162(m) of the Code other than a Stock
Option or SAR. In the case of any Performance Award to which this Section 6(a)(7) applies, the
Plan and such Award will be construed to the maximum extent permitted by law in a manner consistent
with qualifying the Award for such exception. With respect to such Performance Awards, the
Administrator will pre-establish, in writing, one or more specific Performance Criteria no later
than 90 days after the commencement of the period of service to which the performance relates (or
at such earlier time as is required to qualify the Award as performance-based under Section 162(m)
of the Code). Prior to grant, vesting or payment of the Performance Award, as the case may be, the
Administrator will certify whether the applicable Performance Criteria have been attained and such
determination will be final and conclusive. No Performance Award to which this Section 6(a)(7)
applies may be granted after the first meeting of the stockholders of the Company held in [2012]
until the listed performance measures set forth in the definition of “Performance Criteria” (as
originally approved or as subsequently amended) have been resubmitted to and reapproved by the
stockholders of the Company in accordance with the requirements of Section 162(m) of the Code,
unless such grant is made contingent upon such approval.

          (8) Stockholders Agreement. Unless otherwise specifically provided, all Awards issued
under the Plan and all Stock issued thereunder will be subject to the Stockholders Agreement.
Except to the extent permitted by the Stockholders Agreement, no Stock issued under the Plan may be
sold or exchanged or otherwise transferred (by gift or otherwise) until the date that is three
years following an QPO.

          (9) Section 409A. Awards under the Plan are intended either to be exempt from the
rules of Section 409A of the Code or to satisfy those rules, and the Plan and such Awards shall be
construed accordingly. Granted Awards may be modified at any time, in the Administrator’s
discretion, so as to increase the likelihood of exemption from or compliance with the rules of
Section 409A of the Code, so long as such modification does not result in a reduction in value to
the applicable Participant (unless the Participant consents in writing to such modification);
provided that, to the extent the applicable Participant declines to provide such consent and the
Administrator is otherwise unable to modify an award because of such a reduction in value, the
Participant shall be solely responsible for any resulting tax liability and the Company shall
withhold as required by law.

          (10) Certain Requirements of Corporate Law. Awards shall be granted and administered
consistent with the requirements of applicable Delaware law relating to the issuance of Stock and
the consideration to be received therefor, and with the applicable requirements of Delaware, in
each case as determined by the Administrator.

     (b) Awards Requiring Exercise

          (1) Time And Manner Of Exercise. Unless the Administrator expressly provides
otherwise, an Award requiring exercise by the holder will not be deemed to have been

-4-

 

exercised until the Administrator receives a notice of exercise (in form reasonably acceptable
to the Administrator) signed by the appropriate person and accompanied by any payment required
under the Award. If the Award is exercised by any person other than the Participant, the
Administrator may require satisfactory evidence that the person exercising the Award has the right
to do so.

          (2) Exercise Price. The Administrator will determine the exercise price, if any, of
each Award to be granted that requires exercise. Unless the Administrator determines otherwise,
and in all events in the case of a Stock Option or a SAR (except as otherwise permitted pursuant to
Section 7(b)(1) hereof), the exercise price of an Award requiring exercise will not be less than
the Fair Market Value of the Stock subject to the Award, determined as of the date of grant, and in
the case of an ISO granted to a ten-percent shareholder within the meaning of Section 422(b)(6) of
the Code, the exercise price will not be less than 110% of the Fair Market Value of the Stock
subject to the Award, determined as of the date of grant.  Except as otherwise permitted
under Section 7, no such Award, once granted, may be repriced other than in accordance with the
applicable stockholder approval requirements of the stock exchanges or other trading systems on
which the Stock is listed or entered for trading. Fair Market Value shall be determined by the
Administrator consistent with the applicable requirements of Section 422 of the Code and Section
409A of the Code.

          (3) Payment Of Exercise Price. Except as otherwise provided in an Award Agreement,
where the exercise of an Award is to be accompanied by payment, the Administrator may determine the
required or permitted forms of payment, subject to the following: (a) all payments will be by cash
or check acceptable to the Administrator, or (b) if so permitted by the Administrator, (i) through
the delivery of shares of Stock that have a fair market value equal to the exercise price, except
where payment by delivery of shares would adversely affect the Company’s results of operations
under Generally Accepted Accounting Principles or where payment by delivery of shares outstanding
for less than six months would require application of securities laws relating to profit realized
on such shares, (ii) at such time, if any, as the Stock is publicly traded, through a
broker-assisted exercise program acceptable to the Administrator, (iii) by other means acceptable
to the Administrator, or (iv) by any combination of the foregoing permissible forms of payment.
The delivery of shares in payment of the exercise price under clause (b)(i) above may be
accomplished either by actual delivery or by constructive delivery through attestation of
ownership, subject to such rules as the Administrator may prescribe.

          (4) ISOs. No ISO may be granted under the Plan after [                    , 2017], but ISOs
previously granted may extend beyond that date.

     (c) Awards Not Requiring Exercise.

     Awards of Restricted Stock and Unrestricted Stock, whether delivered outright or under Awards
of Stock Units or other Awards that do not require exercise, may be made in exchange for such
lawful consideration, including services, as the Administrator determines.

7. EFFECT OF CERTAIN TRANSACTIONS

     (a) Except as otherwise provided in an Award Agreement:

-5-

 

          (1) Assumption or Substitution. In the event of a Corporate Transaction in which
there is an acquiring or surviving entity, the Administrator may provide for the continuation or
assumption of some or all outstanding Awards, or for the grant of new awards in substitution
therefor, by the acquiror or survivor or any entity controlling, controlled by or under common
control with the acquiror or survivor, in each case on such terms and subject to such conditions
(including vesting or other restrictions) as the Administrator determines are appropriate. The
continuation or assumption of such Awards, to the extent applicable, shall be done on terms and
conditions consistent with Section 409A of the Code.

          (2) Acceleration or Cash-Out of Certain Awards. In the event of a Corporate
Transaction (whether or not there is an acquiring or surviving entity) in which there is no
continuation, assumption or substitution as to some or all outstanding Awards, the Administrator
may provide (unless the Administrator determines otherwise, on terms and conditions consistent with
Section 409A of the Code) for (i) treating as satisfied any vesting condition on any such Award,
(ii) the accelerated delivery of shares of Stock issuable under each such Award consisting of
Restricted Stock Units, in each case on a basis that gives the holder of the Award a reasonable
opportunity, as determined by the Administrator, following exercise of the Award or the issuance of
the shares, as the case may be, to participate as a stockholder in the Corporate Transaction or
(iii) if the Corporate Transaction is one in which holders of Stock will receive upon consummation
a payment (whether cash, non-cash or a combination of the foregoing), the Administrator may provide
for payment (a “cash-out”), with respect to some or all Awards, equal in the case of each affected
Award to the excess, if any, of (A) the fair market value of one Share (as determined by the
Administrator in its reasonable discretion) times the number of Shares subject to the Award, over
(B) the aggregate exercise price, if any, under the Award, in each case on such payment terms
(which need not be the same as the terms of payment to holders of Stock) and other terms, and
subject to such conditions, as the Administrator determines.

          (3) Termination of Awards. Except as otherwise provided in an Award Agreement, each
Award (unless continued, substituted, or assumed pursuant to the Section 7(a)(1)), will terminate
upon consummation of the Corporate Transaction, provided that Restricted Stock Units accelerated
pursuant to clause (ii) of Section 7(a)(2) shall be treated in the same manner as other shares of
Stock (subject to Section 7(a)(4)).

          (4) Additional Limitations. Any Share delivered pursuant to Section 7(a)(2) above
with respect to an Award may, in the discretion of the Administrator, be subject to such
restrictions, if any, as the Administrator deems appropriate to reflect any performance or other
vesting conditions to which the Award was subject prior to the Corporation Transaction and that did
not lapse in connection with the Corporate Transaction. In the case of Restricted Stock, the
Administrator may require that any amounts delivered, exchanged or otherwise paid in respect of
Stock in connection with the Corporate Transaction be placed in escrow or otherwise made subject to
such restrictions as the Administrator deems appropriate to carry out the intent of the Plan.

     (b) Changes In, Distributions With Respect To And Redemptions Of The Stock

          (1) Basic Adjustment Provisions. In the event of any stock dividend or other similar
distribution of stock or other securities of the Company, stock split or combination of

-6-

 

shares (including a reverse stock split), recapitalization, conversion, reorganization,
consolidation, split-up, spin-off, combination, merger, exchange of stock, redemption or repurchase
of all or part of the shares of any class of stock or any change in the capital structure of the
Company or an Affiliate or other transaction or event, the Administrator shall, as appropriate in
order to prevent enlargement or dilution of benefits intended to be made available under the Plan,
make proportionate adjustments to the maximum number of Shares that may be delivered under the Plan
under Section 4(a) and to the maximum share limits described in Section 4(c) and shall also make
appropriate, proportionate adjustments to the number and kind of shares of stock or securities
subject to Awards then outstanding or subsequently granted, any exercise prices relating to Awards
and any other provision of Awards affected by such change. Unless the Administrator determines
otherwise, any adjustments hereunder shall be done on terms and conditions consistent with Section
409A of the Code.

          (2) Certain Other Adjustments. The Administrator may also make adjustments of the
type described in paragraph (b)(1) above to take into account distributions to stockholders or any
other event, if the Administrator determines that adjustments are appropriate to avoid distortion
in the operation of the Plan and to preserve the value of Awards made hereunder, having due regard
for the qualification of ISOs under Section 422 of the Code, the requirements of Section 409A of
the Code, and for the performance-based compensation rules of Section 162(m) of the Code, where
applicable.

          (3) Continuing Application of Plan Terms. References in the Plan to Shares will be
construed to include any stock or securities resulting from an adjustment pursuant to this Section
7.

8. LEGAL CONDITIONS ON DELIVERY OF STOCK

     The Company shall use best efforts to ensure, prior to delivering Shares pursuant to the Plan
or removing any restriction from Shares previously delivered under the Plan, that (a) all legal
matters in connection with the issuance and delivery of such shares have been addressed and
resolved, and (b) if the outstanding Stock is at the time of delivery listed on any stock exchange
or national market system, the shares to be delivered have been listed or authorized to be listed
on such exchange or system upon official notice of issuance. Neither the Company nor any Affiliate
will be obligated to deliver any Shares pursuant to the Plan or to remove any restriction from
Shares previously delivered under the Plan until the conditions set forth in the preceding sentence
have been satisfied and all other conditions of the Award have been satisfied or waived. If the
sale of Stock has not been registered under the Securities Act of 1933, as amended, the Company may
require, as a condition to exercise of the Award, such representations or agreements as counsel for
the Company may consider reasonably appropriate to avoid violation of such Act. The Company may
require that certificates evidencing Stock issued under the Plan bear an appropriate legend
reflecting any restriction on transfer applicable to such Stock, and the Company may hold the
certificates pending lapse of the applicable restrictions.

9. AMENDMENT AND TERMINATION

     The Administrator may at any time or times amend the Plan or any outstanding Award

-7-

 

for any purpose which may at the time be permitted by law, and may at any time terminate the
Plan as to any future grants of Awards; provided, that except as otherwise expressly provided in
the Plan, the Administrator may not, without the Participant’s consent, alter the terms of an Award
so as to affect adversely the Participant’s rights under the Award, unless the Administrator
expressly reserved the right to do so at the time of the Award. Unless otherwise provided in the
Award, the Administrator expressly reserves the right to amend or alter the terms of any Award if
such Award or a portion thereof would be reasonably likely to be treated as a “liability award”
under guidance issued or provided by the Financial Accounting Standards Board (FASB). Any
amendments to the Plan shall be conditioned upon stockholder approval only to the extent, if any,
such approval is required by applicable law (including the Code and applicable stock exchange
requirements), as determined by the Administrator.

10. OTHER COMPENSATION ARRANGEMENTS

     The existence of the Plan or the grant of any Award will not in any way affect the right of
the Company or an Affiliate to Award a person bonuses or other compensation in addition to Awards
under the Plan.

11. WAIVER OF JURY TRIAL

     (a) Waiver of Jury Trial. By accepting an Award under the Plan, each Participant
waives any right to a trial by jury in any action, proceeding or counterclaim concerning any rights
under the Plan and any Award, or under any amendment, waiver, consent, instrument, document or
other agreement delivered or which in the future may be delivered in connection therewith, and
agrees that any such action, proceedings or counterclaim shall be tried before a court and not
before a jury. By accepting an Award under the Plan, each Participant certifies that no officer,
representative or attorney of the Company or any Affiliate has represented, expressly or otherwise,
that the Company would not, in the event of any action, proceeding or counterclaim, seek to enforce
the foregoing waivers.

     (b) Arbitration. In the event the waiver in Section 11(a) is held to be invalid or
unenforceable, if requested by the Company, the parties shall attempt in good faith to resolve any
controversy or claim arising out of or relating to this Plan or any Award hereunder promptly by
negotiations between themselves or their representatives who have authority to settle the
controversy. If the matter has not been resolved within sixty (60) days of the initiation of such
procedure, the Company may require that the parties submit the controversy to arbitration by one
arbitrator mutually agreed upon by the Parties, and if no agreement can be reached within 30 days
after names of potential arbitrators have been proposed by the American Arbitration Association
(the “AAA”), then by one arbitrator having reasonable experience in corporate incentive
plans of the type provided for in this Plan and who is chosen by the AAA. The arbitration shall be
governed by the Federal Arbitration Act, 9 U.S.C. Section 1, et seq., and judgment upon the award
rendered by the arbitrator may be entered in any court having jurisdiction thereof. The place of
arbitration shall be Cupertino, California, or any other location mutually agreed to between the
parties. The arbitrator shall apply the law as established by decisions of the Delaware federal
and/or state courts in deciding the merits of claims and defenses under federal law or any state or
federal anti-discrimination law. The arbitrator is required to state, in writing, the reasoning on
which the award rests. Notwithstanding the

-8-

 

foregoing, this paragraph shall not preclude either party from pursuing a court action for the
sole purpose of obtaining a temporary restraining order or a preliminary injunction in
circumstances in which such relief is appropriate.

12. ESTABLISHMENT OF SUB-PLANS

     The Board may from time to time establish one or more sub-plans under the Plan for purposes of
satisfying applicable blue sky, securities or tax laws of various jurisdictions. The Board shall
establish such sub-plans by adopting supplements to the Plan setting forth (i) such limitations on
the Administrator’s discretion under the Plan as the Board deems necessary or desirable and (ii)
such additional terms and conditions not otherwise inconsistent with the Plan as the Board shall
deem necessary or desirable. All supplements adopted by the Board shall be deemed to be part of
the Plan, but each supplement shall apply only to Participants within the affected jurisdiction and
the Company shall not be required to provide copies of any supplement to Participants in any
jurisdiction that is not affected.

13. GOVERNING LAW

     Except as otherwise provided by the express terms of an Award Agreement, the provisions of the
Plan and of Awards under the Plan shall be governed by and interpreted in accordance with the laws
of the State of Delaware.

-9-

 

EXHIBIT A

Definitions of Terms

     The following terms, when used in the Plan, will have the meanings and be subject to the
provisions set forth below:

     “Administrator”: The Board or, if one or more has been appointed, the Committee. The
Administrator may delegate ministerial tasks to such persons as it deems appropriate.

     “Affiliate”: Any corporation or other entity in a chain of corporations or other entities in
which each corporation or other entity has a controlling interest in another corporation or other
entity in the chain, beginning with the Company and ending with such corporation or other entity.
For purposes of the preceding sentence, except as the Administrator may otherwise determine subject
to the requirements of Treas. Reg. §1.409A-1(b)(5)(iii)(E)(1), the term “controlling interest” has
the same meaning as provided in Treas. Reg. §1.414(c)-2(b)(2)(i), provided that the words “at least
50 percent” are used instead of the words “at least 80 percent” each place such words appear in
Treas. Reg. §1.414(c)-2(b)(2)(i). The Company may at any time by amendment provide that different
ownership thresholds (consistent with Section 409A of the Code) apply but any such change shall not
be effective for twelve (12) months. In addition, any Affiliate must also meet the requirements of
subsection (c) under Rule 701.

     “Award”: Any or a combination of the following:

	 	(i)	 	SARs;
	 
	 	(ii)	 	Stock Options;
	 
	 	(iii)	 	Restricted Stock;
	 
	 	(iv)	 	Unrestricted Stock;
	 
	 	(v)	 	Stock Units, including Restricted Stock Units;
	 
	 	(vi)	 	Awards (other than Awards described in (i) through (iv) above)
that are convertible into or exchangeable for Stock on such terms and
conditions as the Administrator determines;
	 
	 	(vii)	 	Performance Awards; and/or
	 
	 	(viii)	 	Current or deferred grants of cash (which the Company may make payable by any
of its direct or indirect subsidiaries) or loans, made in connection with other
Awards.

     “Award Agreement”: A written agreement between the Company and the Participant evidencing the
Award.

     “Board”: The Board of Directors of BT Triple Crown Capital Holdings III, Inc.

-10-

 

     “Cause”: In the case of any Participant, unless otherwise set forth in a Participant’s Award
Agreement or employment agreement, a termination by the Company or an Affiliate of the
Participant’s Employment or a termination by the Participant of the Participant’s Employment, in
either case following the occurrence of any of the following events: (i) the Participant’s willful
and continued failure to perform his or her material duties with respect to the Company or an
Affiliate which, if curable, continues beyond ten business days after a written demand for
substantial performance is delivered to the Participant by the Company; or (ii) the willful or
intentional engaging by the Participant in material misconduct that causes material and
demonstrable injury, monetarily or otherwise, to the Company or an Affiliate or the Investors and
any of their respective affiliates; or (iii) Participant’s conviction of, or a plea of nolo
contendere to, a crime constituting (A) a felony under the laws of the United States or any state
thereof; or (B) a misdemeanor involving moral turpitude that causes material and demonstrable
injury, monetarily or otherwise to the Company or an Affiliate or the Investors and any of their
respective affiliates; (iv) the Participant’s committing or engaging in any act of fraud,
embezzlement, theft or other act of dishonesty against the Company or its subsidiaries that causes
material and demonstrable injury, monetarily or otherwise, to the Company or an Affiliate or the
Investors and any of their respective affiliates; or (v) the Participant’s breach of his or her
noncompetition or nonsolicitation obligations that causes material and demonstrable injury,
monetarily or otherwise, to the Company or an Affiliate or the Investors and any of their
respective affiliates.

     “Code”: The U.S. Internal Revenue Code of 1986 as from time to time amended and in effect, or
any successor statute as from time to time in effect. For the avoidance of doubt, any reference to
any section of the Code includes reference to any regulations (including proposed or temporary
regulations) promulgated under that section and any IRS guidance thereunder.

     “Committee”: One or more committees of the Board, which, for purposes of meeting certain
requirements of Section 162(m) of Code and any regulations promulgated thereunder (including Treas.
Regs. Section 1.162-27(e)(3)), may be deemed to be any subcommittee of the Committee to which the
Committee has delegated its duties and authority under this Plan consisting solely of at least two
“outside directors,” as defined under Section 162(m) of the Code and the regulations promulgated
thereunder.

     “Company”: BT Triple Crown Capital Holdings III, Inc., a Delaware corporation.

     “Corporate Transaction”: Any of the following: (i) Change of Control (as defined in any Award
Agreement); (ii) a consolidation, merger, or similar transaction or series of transactions with or
into a person (or group of persons acting in concert) that is not an affiliate of any member of the
Investors, or the sale of all or substantially all of the assets of the Company to such a person
(or such a group of persons acting in concert); or (iii) a sale by the Company or an Affiliate or
the Investors and any of their respective affiliates of Stock that results in more than 50% of the
Stock of the Company (or any resulting company after a merger) being held by a person (or group of
persons acting in concert) that does not include any member of the Investors or any of their
respective affiliates, provided, that, in each case, to the extent any amount constituting
“nonqualified deferred compensation” subject to Section 409A of the Code would become payable under
an Award by reason of a Corporate Transaction, it shall become payable only if the event or
circumstances constituting the Corporate Transaction would also constitute a

-11-

 

change in the ownership or effective control of the Company, or a change in the ownership of a
substantial portion of the Company’s assets, within the meaning of subsection (a)(2)(A)(v) of
Section 409A of the Code.

     “Employee”: Any person who is employed by the Company or an Affiliate.

     “Employment”: A Participant’s employment or other service relationship with the Company and
its Affiliates. Unless the Administrator provides otherwise: A change in the capacity in which a
Participant is employed by or renders services to the Company and/or its Affiliates, whether as an
Employee, director, consultant or advisor, or a change in the entity by which the Participant is
employed or to which the Participant rendered services, will not be deemed a termination of
Employment so long as the Participant continues providing services in a capacity and to an entity
described in Section 5. If a Participant’s relationship is with an Affiliate and that entity
ceases to be an Affiliate, the Participant will be deemed to cease Employment when the entity
ceases to be an Affiliate unless the Participant transfers Employment to the Company or its
remaining Affiliates.

     “Fair Market Value”: means the fair market value of the Stock on any given date, as
determined in good faith by the Board which, (a) if the Stock is readily tradable on an established
securities market within the meaning of Section 409A of the Code, shall be determined as provided
thereunder and, (b) in the event that the Stock is not readily tradable on an established
securities market within the meaning of Section 409A of the Code, shall be based on a third party
appraisal that has been completed within at least twelve months prior to such determination date;
provided, that (i) if, for any Participant, since such determination, events have occurred that
would reasonably be expected to cause the fair market value determination to fail to satisfy the
safe harbor methodology for determining such value under Section 409A of the Code, or (ii) in the
event of a valuation performed upon the termination of a Participant, if the Chief Executive
Officer or President of the Company is the terminated Participant and the Participant objects to
the determination of such fair market value by the Board of Directors, then in any such event the
determination of what constitutes “fair market value” with respect to the Stock for which the
Board’s determination is being disputed will be determined by a mutually acceptable expert, whose
determination will be binding on the parties, the costs of which shall be borne by the Company.

     “Investors”: shall have the meaning set forth in the Stockholders Agreement.

     “ISO”: A Stock Option intended to be an “incentive stock option” within the meaning of
Section 422 of the Code. Each option granted pursuant to the Plan will be treated as providing by
its terms that it is to be a non-incentive stock option unless, as of the date of grant, it is
expressly designated as an ISO.

     “Participant”: A person who is granted an Award under the Plan.

     “Performance Award": An Award subject to Performance Criteria. The Committee in its
discretion may grant Performance Awards that are intended to qualify for the performance-based
compensation exception under Section 162(m) of the Code and Performance Awards that are not
intended so to qualify.

-12-

 

     “Performance Criteria": Specified criteria, other than the mere continuation of Employment or
the mere passage of time, the satisfaction of which is a condition for the grant, exercisability,
vesting or full enjoyment of an Award. For purposes of Awards that are intended to qualify for the
performance-based compensation exception under Section 162(m) of the Code, a Performance Criterion
will mean an objectively determinable measure of performance relating to any or any combination of
the following (measured either absolutely or by reference to an index or indices and determined
either on a consolidated basis or, as the context permits, on a divisional, subsidiary, line of
business, project or geographical basis or in combinations thereof): sales; revenues; assets;
expenses; earnings before or after deduction for all or any portion of interest, taxes,
depreciation, or amortization, whether or not on a continuing operations or an aggregate or per
share basis; return on equity, investment, capital or assets; one or more operating ratios;
borrowing levels, leverage ratios or credit rating; market share; capital expenditures; cash flow;
stock price; stockholder return; sales of particular products or services; customer acquisition or
retention; acquisitions and divestitures (in whole or in part); joint ventures and strategic
alliances; spin-offs, split-ups and the like; reorganizations; or recapitalizations,
restructurings, financings (issuance of debt or equity) or refinancings. A Performance Criterion
and any targets with respect thereto determined by the Administrator need not be based upon an
increase, a positive or improved result or avoidance of loss. To the extent consistent with the
requirements for satisfying the performance-based compensation exception under Section 162(m), the
Administrator may provide in the case of any Award intended to qualify for such exception that one
or more of the Performance Criteria applicable to such Award will be adjusted in an objectively
determinable manner to reflect events (for example, but without limitation, acquisitions or
dispositions) occurring during the performance period that affect the applicable Performance
Criterion or Criteria.

     “Plan”: Clear Channel 2007 Executive Incentive Plan as from time to time amended and in
effect.

     “QPO”: An underwritten public offering and sale of common stock of the Company for cash
pursuant to an effective registration statement by the Company or any member of the Sponsor Group
(as such term is defined in the Stockholders Agreement).

     “Restricted Stock”: An Award of Stock for so long as the Stock remains subject to
restrictions under this Plan or such Award requiring that it be redelivered or offered for sale to
the Company if specified conditions are not satisfied.

     “Restricted Stock Unit”: A Stock Unit that is, or as to which the delivery of Stock or cash
in lieu of Stock is, subject to the satisfaction of specified performance or other vesting
conditions.

     “SAR”: A right entitling the holder upon exercise to receive an amount (payable in cash or
shares of Stock of equivalent value, as specified in the Award except as otherwise determined by
the Administrator) equal to the excess of the fair market value of the Shares subject to the right
over a specified amount that is not less than the fair market value of such Shares at the date of
grant.

     “Share”: a share of Stock.

-13-

 

     “Stock”: Class A Common Stock of the Company, par value $.001 per share (which shall be the
same class of common stock to be held by public shareholders of the Company).

     “Stockholders Agreement”: Stockholders Agreement, dated as of [___, 2007,] among the
Company and certain Affiliates, stockholders and Participants.

     “Stock Option”: An option entitling the recipient to acquire Shares upon payment of the
applicable exercise price.

     “Stock
Unit”: An unfunded and unsecured promise, denominated in Shares, to deliver Stock or
cash measured by the value of the Stock in the future.

     “Unrestricted Stock”: An Award of Stock not subject to any restrictions under the Plan.

-14-

 

EXHIBIT B

Form of Option Agreement

-15-

 

EXHIBIT C

Form of Rollover Option Agreement

-16-

 

EXHIBIT D

Form of Restricted Stock Agreement

-17-

 

	 	 	 
	 

	 	Name of Grantee:

This Award and any securities delivered hereunder are subject to restrictions on voting and
transfer and requirements of sale and other provisions as set forth in the Equityholders Agreement
[Subject to Review] among BT Triple Crown Capital Holdings III, Inc. and certain investors, dated
as of [___, 2007], as amended from time to time, (the “Equityholders Agreement”). This
Award and any securities delivered hereunder constitute [Management Shares] as defined therein.

BT TRIPLE CROWN CAPITAL HOLDINGS III, INC.

Senior Executive Restricted Stock Award 

BT Triple Crown Capital Holdings III, Inc.

200 East Basse Road

San Antonio, TX 78209

Attention: [___]

Ladies and Gentlemen:

The undersigned Grantee (i) acknowledges receipt of an award (the “Award”) of restricted
stock from BT Triple Crown Capital Holdings III, Inc., a Delaware corporation (the
“Company”), under the Company’s 2007 Executive Incentive Plan (the “Plan”), subject
to the terms set forth below and in the Plan, a copy of which Plan, as in effect on the date
hereof, is attached hereto as Exhibit A; and (ii) agrees with the Company as follows:

     1. Effective Date. This Agreement shall take effect as of [___, 2007], which
is the date of grant of the Award (the “Grant Date”). The Grantee shall be the record owner
of the Shares.

     2. Shares
Subject to Award. The Award consists of a total of
___ [shares of Class
A Common Stock of the Company, par value $.001 per share] (the “Shares”) with a Fair Market Value
on the Grant Date of $[___] per Share and $20,000,000.00 (TWENTY MILLION DOLLARS) in the aggregate.

     The Grantee’s rights to the Shares are subject to the restrictions described in this Agreement
and the Plan (which is incorporated herein by reference with the same effect as if set forth herein
in full) in addition to such other restrictions, if any, as may be imposed by law.

     3. Nontransferability of Shares. The Shares acquired by the Grantee pursuant to this
Agreement shall not be sold, transferred, pledged, assigned or otherwise encumbered or disposed of
except as provided in the Equityholders Agreement dated as of [___, 2007] among the Grantee,
the Company, certain of the Company’s subsidiaries and certain of the Company’s Equityholders (the
“Equityholders Agreement”).

     4. Forfeiture Risk. If the Grantee’s Employment with the Company and its

 

 

subsidiaries ceases for any reason, other than death, Disability, termination of employment by
the Company without Cause, or resignation by Grantee for Good Reason, then any and all outstanding
and unvested Shares acquired by the Grantee hereunder shall be automatically and immediately
forfeited.

The Grantee hereby (i) appoints the Company as the attorney-in-fact of the Grantee to take such
actions as may be necessary or appropriate to effectuate a transfer of the record ownership of any
such shares that are unvested and forfeited hereunder, (ii) agrees to deliver to the Company, as a
precondition to the issuance of any certificate or certificates with respect to unvested Shares
hereunder, one or more stock powers, endorsed in blank, with respect to such Shares, and (iii)
agrees to sign such other powers and take such other actions as the Company may reasonably request
to accomplish the transfer or forfeiture of any unvested Shares that are forfeited hereunder.

     5. Certificates. The Company will issue the Grantee a certificate representing the
Shares. If unvested Shares are held in book entry form at any time thereafter, the Grantee agrees
that the Company may give stop transfer instructions to the depositary, stock transfer agent or
other keeper of the Company’s stock records to ensure compliance with the provisions hereof.

     6. Vesting of Shares. Unless earlier vested pursuant to the Plan, the Shares acquired
hereunder shall vest during the Grantee’s Employment by the Company or a subsidiary thereof in
accordance with the provisions of this Section 6 and applicable provisions of the Plan, as follows:

          20% on and after [the first anniversary of the Grant Date];

          20% on and after [the second anniversary of the Grant Date];

          20% on and after [the third anniversary of the Grant Date];

          20% on and after [the fourth anniversary of the Grant Date]; and

          20% on and after [the fifth anniversary of the Grant Date].

Notwithstanding the above, 100% of the Grantee’s outstanding and unvested Shares shall vest
immediately upon the earlier to occur of (i) a Change of Control (so long as the Grantee is
employed with the Company or any subsidiary thereof) or (ii) the termination of the Grantee’s
Employment with the Company and its subsidiaries due to death, Disability, termination of
employment by the Company without Cause, or resignation by Grantee for Good Reason.

     7. Legend. Any certificates representing Shares shall contain a legend substantially
in the following form:

THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE
SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING FORFEITURE) OF THE CLEAR CHANNEL 2007
EXECUTIVE INCENTIVE PLAN AND A RESTRICTED STOCK AWARD AGREEMENT ENTERED INTO BETWEEN THE
REGISTERED OWNER AND BT TRIPLE

-2-

 

CROWN CAPITAL HOLDINGS III, INC. AND THE EQUITYHOLDERS AGREEMENT AMONG BT TRIPLE CROWN
CAPITAL HOLDINGS III, INC. AND CERTAIN INVESTORS DATED AS OF
    , 200     . COPIES OF
SUCH PLAN, AWARD AGREEMENT AND EQUITYHOLDERS AGREEMENT ARE ON FILE IN THE OFFICES OF CLEAR
BT TRIPLE CROWN CAPITAL HOLDINGS III, INC.

Upon the request of the Grantee, as soon as practicable following the vesting of any such Shares
the Company shall cause a certificate or certificates covering such Shares, without the aforesaid
legend, to be issued and delivered to the Grantee. If any Shares are held in book-entry form, the
Company may take such steps as it deems necessary or appropriate to record and manifest the
restrictions applicable to such Shares.

     8. Dividends, etc. The Grantee shall be entitled to (i) receive any and all dividends
or other distributions paid with respect to those vested and unvested Shares of which the Grantee
is the record owner on the record date for such dividend or other distribution, whether or not
vested at such time, in the same form and amount as any holder of Stock receives, and (ii)
[subject to the terms of the Equityholders Agreement, vote any Shares of which the Grantee is the
record owner on the record date for such vote] [subject to review of such Agreement]; provided,
however, that any property (other than cash) distributed with respect to a share of Stock (the
“Associated Share”) acquired hereunder, by reason of a stock dividend, stock split or other
similar adjustment to the Stock pursuant to Section 7(b) of the Plan, shall be subject to the
restrictions of this Agreement in the same manner and for so long as the Associated Share remains
subject to such restrictions, and shall be promptly forfeited if and when the Associated Share is
so forfeited.

     9. Sale of Vested Shares. The Grantee understands that the sale of any Share, once it
has vested, will remain subject to (i) satisfaction of applicable tax withholding requirements, if
any, with respect to the vesting or transfer of such Share; (ii) the completion of any
administrative steps (for example, but without limitation, the transfer of certificates) that the
Company may reasonably impose; (iii) applicable requirements of federal and state securities laws;
and (iv) the terms and conditions of the Equityholders Agreement to the extent that they
are then in effect.

     10. Provisions of the Plan. This Grant is subject in its entirety to the provisions
of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the
date of the grant of this Award has been furnished to the Grantee and the Grantee agrees to be
bound by the terms of the Plan and this Award. In the event of any conflict between the terms of
this Award and the Plan, the terms of this Award shall control. Notwithstanding Section 9 of the
Plan, the Administrator shall not, in order to avoid liability accounting as provided therein,
revoke or reduce the amount of any Award, but may impose reasonable terms and conditions on the
exercise of put rights, call rights and other transactions as may be reasonably necessary to avoid
the treatment of the grant as a liability award under FASB. Notwithstanding Section 9 of the Plan,
the Administrator shall not, without the Participant’s consent, alter the terms of the Plan or this
Agreement so as to adversely affect the Participant’s rights under this Agreement.

-3-

 

     11. Other Agreements. [Grantee acknowledges and agrees that the shares delivered
under this Award Agreement shall be subject to the Equityholders Agreement dated as of [___,
2007 among the Grantee, the Company, certain of the Company’s subsidiaries and certain of the
Company’s Equityholders (as amended, restated or otherwise modified, the “Equityholders
Agreement”) and the transfer and other restrictions, rights, and obligations set forth therein.
By executing this Agreement, Grantee hereby becomes a party to and bound by the Equityholders
Agreement as a [Manager] (as such term is defined in the Equityholders Agreement), without any
further action on the part of Grantee, the Company or any other person. Except to the extent
permitted by the Equityholders Agreement, no shares delivered under the Plan may be sold or
exchanged or otherwise transferred (by gift or otherwise) until the date that is three years
following an QPO.]

     12. Certain Tax Matters. The Grantee expressly acknowledges the following:

A. The Grantee has been advised to confer promptly with a professional tax advisor to
consider whether the Grantee should make a so-called “83(b) election” with respect to the
Shares. Any such election, to be effective, must be made in accordance with applicable
regulations and within thirty (30) days following the date this Award is granted and the
Grantee must provide the Company with a copy of the 83(b) election prior to filing. The
Company has made no recommendation to the Grantee with respect to the advisability of making
such an election.

B. The award or vesting of the Shares acquired hereunder, and the payment of dividends with
respect to such Shares, may give rise to “wages” subject to withholding. The Grantee
expressly acknowledges and agrees that his or her rights hereunder are subject to his or her
promptly paying to the Company in cash (or by such other means as may be acceptable to the
Company in its discretion), all taxes required to be withheld in connection with such award,
vesting or payment. Notwithstanding the foregoing, the Administrator shall, at the election
of the Participant, hold back a share of Stock from an Award or permit a Participant to
tender previously owned shares of Stock in satisfaction of tax withholding requirements (but
not in excess of the applicable minimum statutory withholding rate).

     13. Definitions. The initially capitalized term Grantee shall have the meaning set
forth on the first page of this Agreement; initially capitalized terms not otherwise defined herein
shall have the meaning provided in the Plan and the Equityholders Agreement, and, as used herein,
the following terms shall have the meanings set forth below:

     “Cause” has the meaning set forth in the Employment Agreement.

     “Change of Control” means any of the following: (i) the sale of all or substantially all of
the assets of the Company, to a person (or group of persons acting in concert) that is not an
Affiliate of an Investor; (ii) a sale by the Company, any Investor or any Affiliate of an Investor
of Stock that results in more than 50% of the Stock of the Company (or any resulting company after
a merger) being held by a person (or group of persons acting in concert) that does not include any
Investor or any of their respective Affiliates; or (iii) a sale, or series of sales (or other
transactions), by the Company, any Investor or any Affiliate of an Investor, after which the

-4-

 

Investors owns less than 25% of the Stock of, and has the ability to appoint only five or
fewer directors to the Board of, the Company (or any resulting company after a merger).

     “Disability” has the meaning set forth in the Employment Agreement.

     “Employment Agreement” shall mean the employment agreement entered into between the Company
and the Grantee dated ___, 200___.

     “Good Reason” has the meaning set forth in the Employment Agreement.

     “Investors” has the meaning set forth in the Equityholders Agreement.

     “Person” shall mean any individual, partnership, corporation, association, trust, joint
venture, unincorporated organization or other entity.

     “Vest” as used herein with respect to any Share means the lapsing of the restrictions
described herein with respect to such Share.

     14. General. For purposes of this Agreement and any determinations to be made by the
Administrator or Compensation Committee, as the case may be, hereunder, the determinations by the
Administrator or Compensation Committee, as the case may be, shall be binding upon the Grantee and
any transferee.

[Remainder of the page intentionally left blank]

-5-

 

	 	 	 	 	 
	 

	 	Very truly yours,	 	 
	 
	 	 	 	 
	 

	 	  

«First_Name»
«Last_Name»
	 	 
	 
	 	 	 	 
	 

	 	Address:	 	 
	 
	 	 	 	 
	 

	 	«Street»	 	 
	 

	 	«City», «State» «Zip»	 	 

Dated:

The foregoing Restricted Stock

Award is hereby accepted:

BT TRIPLE CROWN CAPITAL HOLDINGS III, INC.

	 	 	 
	 
	 	 
	 

Name:

	 	 
	Title:
	 	 

-0-

 

Section 83(b) Election

[DATE]

Department of the Treasury

Internal Revenue Service Center

Andover, MA 05501-0002

Ladies and Gentlemen:

     I hereby make an election pursuant to Section 83(b) of the Internal Revenue Code of 1986, as
amended. The following information is submitted as required by Treas. Reg. §1.83-2(e):

	 	 	 	 	 
	1.

	 	Name of Taxpayer:
	 	«First_Name» «Last_Name»
	 

	 	 	 	 
	 

	 	Home Address:
	 	«Street»

«City», «State» «Zip»
	 

	 	 	 	 
	 

	 	Social Security No.:
	 	                                        
	 

	 	 	 	 
	2.

	 	Property for which election is made:
	 	«Total_Shares» Shares [of Class A Common
Stock] of BT Triple Crown Capital Holdings III, Inc.
	 

	 	 	 	 
	3.

	 	Date of Transfer:	 	 
	 

	 	 	 	 
	4.

	 	Taxable year for which election is made:
	 	Calendar year 200[7]
	 

	 	 	 	 
	5.

	 	Restrictions to which property is subject:
	 	The shares are subject to time-based
vesting restrictions and other forfeiture provisions as specified in a restricted stock
award agreement and are restricted as to transfer in accordance with a Equityholders
agreement. The shares will generally be forfeited if employment ceases prior to
vesting.
	 

	 	 	 	 
	6.

	 	The fair market value of the property at
the time of its transfer to me (without
regard to restrictions) was:
	 	«Total_Value»
	 

	 	 	 	 
	7.

	 	Amount paid for the property:
	 	$0.00

     A copy of this election has been furnished to the Company and to each other person, if any,
required to receive the election pursuant to Treas. Reg. § 1.83-2(d).

-1-

 

     Please acknowledge receipt of this Section 83(b) Election by signing or stamping the enclosed
copy of this letter and return it in the enclosed, self-addressed, stamped envelope.

	 	 	 	 	 
	 

	 	Very truly yours,	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 

«First_Name» «Last_Name»
	 	 

cc: BT Triple Crown Capital Holdings III, Inc.

-2-

 

ROLLOVER OPTION AGREEMENT

                                                Optionee:

     This Option and any securities issued upon exercise of this Option are subject to restrictions
on voting and transfer and requirements of sale and other provisions as set forth in the
Equityholders Agreement among BT Triple Crown Capital Holdings III, Inc. and certain investors,
dated as of [ ], as amended from time to time (the “Equityholders Agreement”) and the
Registration Rights and Coordination Agreement referred to therein (the “Registration Rights and
Coordination Agreement”). This Option and any securities issued upon exercise of this Option
constitute an Option and Shares, respectively, as defined in the Equityholders Agreement.

BT TRIPLE CROWN CAPITAL HOLDINGS III, INC.

NONQUALIFIED STOCK OPTION AGREEMENT

     This stock option agreement (the “Agreement”) is hereby entered into between BT Triple Crown
Capital Holdings III, Inc., a Delaware corporation (the “Company”), and the Optionee pursuant to
the Company’s 2007 Executive Incentive Plan, as amended from time to time (the “Plan”). For the
purpose of this Agreement, the “Grant Date” shall mean ___, 2007.

	1.	 	Grant of Option. This certificate evidences the grant by the Company on the Grant Date to
the Optionee of an option to purchase (the “Option”), in whole or in part, on the terms
provided herein and in the Plan, [shares of Class A Common Stock of the Company, par value
$.001 per share] (the “Shares”) at $[___] per Share. 1 The Option evidenced by
this certificate is not intended to qualify as an incentive stock option under Section 422 of
the Internal Revenue Code (the “Code”). This Option is granted in substitution of an option
(which option is hereby deemed cancelled) held by the Optionee under equity incentive plans
maintained by Clear Channel Communications, Inc. (“Rollover Option”). Except as permitted in
Section 409A Rollover Law and expressly provided in this Agreement, the terms of the Rollover
Option are deemed incorporated into this Option; it being understood, that the exercise price
and the number of shares may be adjusted as permitted under Section 409A Rollover Law. The
Option shall be subject to the terms of the plan that previously governed the Rollover Option
immediately prior to the date hereof, and to the terms of any other agreement previously
governing the Rollover Option for which this Option is substituted to the extent required by
Section 409A Rollover Law, and will also be governed by the Plan, as applicable, and the
Equityholders Agreement and Registration Rights and Coordination Agreement, in each case to
the extent consistent with Section 409A Rollover Law.

 

			
	1	 	Exercise price of the option to be reduced to
the extent permitted by law, provided that the aggregate spread on the rolled
options shall be maintained.

 

 

	2.	 	Vesting. The Option is fully vested.
	 
	3.	 	Exercise of Option. Each election to exercise this Option shall be subject to the terms and
conditions of the Plan and shall be in writing, signed by the Optionee or by his or her
executor or administrator or by the Person or Persons to whom this Option is transferred by
will or the applicable laws of descent and distribution (the “Legal Representative”), and made
pursuant to and in accordance with the terms and conditions set forth in the Plan. In
addition to the methods of payment otherwise permitted by the Plan, the Administrator shall,
at the election of the Optionee, hold back Shares from an Award having a Fair Market Value
equal to the exercise price in payment of the Option exercise price. The latest date on which
this Option may be exercised (the “Final Exercise Date”) is the latest date upon which the
Rollover Option was exercisable, subject to earlier termination in accordance with the terms
and provisions of the Plan and this Agreement.
	 
	4.	 	Other Agreements. Optionee acknowledges and agrees that the shares received upon exercise of
this Option shall be subject to the Equityholders Agreement, the Registration Rights and
Coordination Agreement and the transfer and other restrictions, rights, and obligations set
forth in those agreements. By executing this Agreement, Optionee hereby becomes a party to
and bound by the Equityholders Agreement and by the Registration Rights and Coordination
Agreement as a Manager (as such term is defined in those agreements), without any further
action on the part of Optionee, the Company or any other person.
	 
	5.	 	Extraordinary Dividends. Notwithstanding anything set forth in the Plan to the contrary,
however, in the event of the payment of any extraordinary cash dividend on Shares (a “Special
Dividend Payment”), the Optionee shall be entitled to receive a payment in an amount equal to
the cash dividends the Optionee would have received (a “Dividend Equivalent Payment”), if the
Optionee held as a Stock holder the same number of Shares subject to the Option, which payment
shall be made at the same time as such Special Dividend Payments are made. Notwithstanding
Section 9 of the Plan, the Administrator shall not, without the Participant’s consent, alter
the terms of the Plan or the Award Agreement so as to adversely affect the Participant’s
rights under this Agreement.
	 
	6.	 	Corporate Transaction. In the event of a Corporate Transaction in which holders of Stock
will receive upon consummation a payment (whether cash, non-cash or a combination of the
foregoing), the Optionee shall be entitled to receive, in consideration for any portion of the
Award then outstanding such payment (a “cash-out”), equal to the excess, if any, of (A) the
price paid in such Corporate Transaction for one Share times the number of Shares subject to
the Award, over (B) the aggregate exercise price, if any, under the Award, in each case on
such payment terms (which shall be the same as the terms of payment to holders of Stock) and
other terms, and subject to such conditions, as are consistent with those applied to the
consideration received by holders of Stock in the transaction, as the Administrator reasonably
and in good faith determines.
	 
	7.	 	Withholding. No shares will be transferred pursuant to the exercise of this Option unless
and until the person exercising this Option shall have remitted to the Company an amount

 

 

	 	 	sufficient to satisfy any federal, state, or local withholding tax requirements, or shall
have made other arrangements satisfactory to the Company with respect to such taxes. The
Administrator will make such provision for the withholding of taxes as it deems necessary.
The Administrator shall, at the election of the Optionee, hold back shares of Stock from an
Award or permit a Optionee to tender previously owned shares of Stock in satisfaction of tax
withholding requirements (but not in excess of the applicable minimum statutory withholding
rate).
	8.	 	Nontransferability of Option. This Option is not transferable by the Optionee other than by
will or the applicable laws of descent and distribution, and, subject to the foregoing
provision, is exercisable during the Optionee’s lifetime only by the Optionee.
	 
	9.	 	Status Change. Upon the termination of the Optionee’s Employment, this Option shall continue
or terminate, as and to the extent provided in the Plan, except to the extent required under
Section 409A Rollover Law.
	 
	10.	 	Effect on Employment. Neither the grant of this Option, nor the issuance of shares upon
exercise of this Option, shall give the Optionee any right to be retained in the employ of the
Company or its Affiliates, affect the right of the Company or its Affiliates to discharge or
discipline such Optionee at any time, or affect any right of such Optionee to terminate his or
her Employment at any time.
	 
	11.	 	Provisions of the Plan. This Option is subject to the terms of the plan that previously
governed the Rollover Option immediately prior to the date hereof and to the terms of any
other agreement previously governing the Rollover Option for which this Option is substituted,
which are incorporated herein by reference, to the extent required by Section 409A Rollover
Law. The Option is also subject to the provisions of the Plan, as applicable, which are also
incorporated herein by reference. A copy of the Plan as in effect on the date of the grant of
this Option has been furnished to the Optionee. By exercising all or any part of this Option,
the Optionee agrees to be bound by the terms of the Plan and this Option. In the event of any
conflict between the terms of this Option and the Plan, between this Option and plan that
previously governed the Rollover Option immediately prior to the date hereof, or between this
Option and any other agreement previously governing the Rollover Option for which this Option
is substituted, the terms of this Option shall control, except to the extent required under
Section 409A Rollover Law. Notwithstanding Section 9 of the Plan, the Administrator shall
not, without the Participant’s consent, alter the terms of the Plan or this Agreement so as to
adversely affect the Participant’s rights under this Agreement.
	 
	12.	 	Definitions. The initially capitalized terms Optionee and Grant Date shall have the meanings
set forth on the first page of this Agreement; initially capitalized terms not otherwise
defined herein shall have the meaning provided in the Plan and the Equityholders Agreement,
and, as used herein, the following terms shall have the meanings set forth below:

     “Person” shall mean any individual, partnership, corporation, association, trust, joint
venture, unincorporated organization or other entity.

 

 

     “Section 409A Rollover Law” shall mean Section 409A of the Code and guidance issued
thereunder (or applicable thereto) including Treasury Regulations in respect of Section 409A
of the Code, Treasury Regulation Section 1.424-1 and any subsequent guidance under Section
409A of the Code.

	13.	 	General. For purposes of this Option and any determinations to be made by the Administrator
or Compensation Committee, as the case may be, hereunder, the determinations by the
Administrator or Compensation Committee, as the case may be, shall be binding upon the
Optionee and any transferee.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

 

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

	 	 	 	 	 	 	 
	 	 	BT TRIPLE CROWN CAPITAL HOLDINGS III, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 
 

Name:
	 	 
	 

	 	 	 	Title:	 	 

Dated:

Acknowledged and Agreed

	 	 	 
	 
 

Name:

	 	 
	 
	 	 
	Address of Principal Residence:
	 
	 	 
	 
 

	 	 
	 
 

	 	 
	 
 

	 	 

 

 

SENIOR EXECUTIVE OPTION AGREEMENT

                                                Optionee:

     This Option and any securities issued upon exercise of this Option are subject to restrictions
on voting and transfer and requirements of sale and other provisions as set forth in [the
Equityholders Agreement among BT Triple Crown Capital Holdings III, Inc. and certain investors,
dated as of [___, 2007], as amended from time to time, (the “Equityholders Agreement”). ]
[subject to review] This Option and any securities issued upon exercise of this Option constitute
[an Option and Management Shares] as defined therein.

BT TRIPLE CROWN CAPITAL HOLDINGS III, INC.

NON-QUALIFIED STOCK OPTION AGREEMENT

     This stock option (the “Agreement”) is granted by BT Triple Crown Capital Holdings III, Inc.,
a Delaware corporation (the “Company”), to the Optionee, pursuant to the Company’s 2007 Equity
Incentive Plan (as amended from time to time, the “Plan”). For the purpose of this Agreement, the
“Grant Date” shall mean [___, 2007].

     1. Grant of Option. The Agreement evidences the grant by the Company on the Grant
Date to the Optionee of an option to purchase, in whole or in part, on the terms provided herein
and in the Plan, [shares of Class A Common Stock of the Company, par value $.001 per share] (the
“Shares”), as set forth below:

     (a)
___ Shares at [$ ] per Share (the “Tranche 1 Options”)1;

     (b)
___ Shares at [$ ] per Share (the “Tranche 2 Options”); and

     (c)
___ Shares at [$ ] per Share (the “Tranche 3 Options”).”

     The Option evidenced by this Agreement is not intended to qualify as an incentive stock option
under Section 422 of the Internal Revenue Code (the “Code”).

     2. Vesting.

     (a) During Employment. During the Optionee’s Employment, this Option shall
vest as follows:

     (i) Tranche 1: The Tranche 1 Options will vest and become exercisable
(A) with respect to 25% of the Shares subject to the Tranche 1 Options on and after
the third anniversary of the Grant Date; (B) with respect to an additional 25% of
the Shares subject to the Tranche 1 Options on and after the fourth anniversary of
the Grant Date; and (C) with respect to the remaining 50%

 

			
	1	 	50% of the grant shall be Tranche 1 Options; 25%
shall be Tranche 2 Options, and 25% shall be Tranche 3 Options.

1

 

of the Shares subject to the Tranche 1 Options on and after the fifth
anniversary of the Grant Date.

     (ii) Tranche 2: The Tranche 2 Options shall only vest and become
exercisable upon a 2.0x Return to Investor.

     (iii) Tranche 3: The Tranche 3 Options shall only vest and become
exercisable upon a 2.5x Return to Investor.

     (b) Termination of Employment Upon Death or Disability or Termination Without Cause
or for Good Reason. Notwithstanding any other provision of this Section 2,
automatically and immediately upon the cessation of Employment, all outstanding and unvested
Tranche 1, 2 and 3 Options shall cease to be exercisable and will terminate, except that:

     (i) upon a termination due to the death or Disability of the Optionee, any
unvested Tranche 1 Options that would have vested as of the next succeeding
anniversary of the Closing Date following such death or Disability, termination
without Cause or resignation for Good Reason will vest as if the Optionee’s
Employment had continued through such date;

     (ii) upon a termination due to the death or Disability of the Optionee, any
unvested Tranche 2 and Tranche 3 Options that would have vested as of the next
succeeding anniversary of the Closing Date following such death or Disability will
vest as if the Optionee’s Employment had continued through such date; and

     (iii) upon a termination by the company without Cause or resignation by the
Optionee for Good Reason, all unvested Tranche 1 Options, Tranche 2 Options and
Tranche 3 Options will vest.

     (c) Change of Control. Notwithstanding any other provision of this Section 2,
in the event of a Change of Control, 100% of the Shares subject to any then outstanding and
unvested Tranche 1 Options shall become fully vested.

Notwithstanding the foregoing (but subject to any contrary provision of this Agreement or any other
written agreement between the Company and the Optionee with respect to vesting and termination of
Shares granted under the Plan), no Options shall vest or shall become eligible to vest on any date
specified above unless the Optionee is then, and since the Grant Date has continuously been,
Employed by the Company or its subsidiaries.

     3. Exercise of Option. Each election to exercise this Option shall be subject to the
terms and conditions of the Plan and shall be in writing, signed by the Optionee or by his or her
executor or administrator or by the person or persons to whom this Option is transferred by will or
the applicable laws of descent and distribution (the “Legal Representative”), and made pursuant to
and in accordance with the terms and conditions set forth in the Plan. In addition to the methods
of payment otherwise permitted by the Plan, the Administrator shall, at the election of the
Optionee, hold back Shares from an Award having a Fair Market Value equal to the

2

 

exercise price in payment of the Option exercise price. The latest date on which this Option
may be exercised (the “Final Exercise Date”) is the date which is the tenth anniversary of the
Grant Date, subject to earlier termination in accordance with the terms and provisions of the Plan
and this Agreement. Notwithstanding the foregoing, and subject to the provisions of Section 2(b)
above, the following rules will apply if a Optionee’s Employment ceases: automatically and
immediately upon the cessation of Employment, this Option will cease to be exercisable and will
terminate, except that:

     (a) any portion of this Option held by the Optionee or the Optionee’s permitted
transferees, if any, immediately prior to the termination of the Optionee’s Employment by
reason of a termination by the Company without Cause, the Optionee’s Retirement, or a quit
by the Optionee for Good Reason, to the extent then vested and exercisable, will remain
exercisable for the shorter of (i) a period of 180 days or (ii) the period ending on the
Final Exercise Date, and will thereupon terminate;

     (b) any portion of this Option held by the Optionee or the Optionee’s permitted
transferees, if any, immediately prior to a termination of the Optionee’s Employment by
reason of a quit without Good Reason, to the extent then vested and exercisable, will remain
exercisable for the shorter of (i) a period of 90 days or (ii) the period ending on the
Final Exercise Date, and will thereupon terminate;

     (c) any portion of this Option held by the Optionee or the Optionee’s permitted
transferees, if any, immediately prior to the termination of the Optionee’s Employment by
reason of death or Disability, to the extent then vested and exercisable, will remain
exercisable for the shorter of (i) the one year period ending with the first anniversary of
the Optionee’s death or Disability, as the case may be, or (ii) the period ending on the
Final Exercise Date, and will thereupon terminate; and

     (d) any portion of this Option held by the Optionee or the Optionee’s permitted
transferees, if any, immediately prior to the cessation of the Optionee’s Employment will
immediately terminate upon such cessation if such cessation of Employment has resulted in
connection with an act or failure to act constituting Cause.

     4. Corporate Transaction. In the event of a Corporate Transaction in which holders of
Stock will receive upon consummation a payment (whether cash, non-cash or a combination of the
foregoing), the Optionee shall be entitled to receive, in consideration for any portion of the
Award then outstanding, such payment (a “cash-out”), equal to the excess, if any, of (A) the price
paid in such Corporate Transaction for one Share times the number of Shares subject to the Award,
over (B) the aggregate exercise price, if any, under the Award, in each case on such payment terms
(which shall be the same as the terms of payment to holders of Stock) and other terms, and subject
to such conditions, as are consistent with those applied to the consideration received by holders
of Stock in the transaction, as the Administrator reasonably and in good faith determines.

3

 

     5. Other Agreements. Optionee acknowledges and agrees that the shares received upon
exercise of this Option shall be subject to the Equityholders Agreement dated as of [___,
2007] among the Optionee, the Company, certain of the Company’s subsidiaries and certain of the
Company’s stockholders (as amended, restated or otherwise modified, the “Equityholders
Agreement”) and the transfer and other restrictions, rights, and obligations set forth therein.
By executing this Agreement, Optionee hereby becomes a party to and bound by the Equityholders
Agreement as a [Manager] (as such term is defined in the Equityholders Agreement), without any
further action on the part of Optionee, the Company or any other person.

     6. Withholding. No Shares will be transferred pursuant to the exercise of this Option
unless and until the person exercising this Option shall have remitted to the Company an amount
sufficient to satisfy any federal, state, or local withholding tax requirements, or shall have made
other arrangements satisfactory to the Company with respect to such taxes. The Administrator
shall, at the election of the Optionee, hold back Shares from an Award or permit an Optionee to
tender previously owned shares of Stock in satisfaction of tax withholding requirements (but not in
excess of the applicable minimum statutory withholding rate).

     7. Nontransferability of Option. This Option is not transferable by the Optionee
other than by will or the applicable laws of descent and distribution, and is exercisable during
the Optionee’s lifetime only by the Optionee.

     8. Status Change. Upon the termination of the Optionee’s Employment, this Option
shall continue or terminate, as and to the extent provided in the Plan.

     9. Effect on Employment. Neither the grant of this Option, nor the issuance of Shares
upon exercise of this Option, shall give the Optionee any right to be retained in the employ of the
Company or its Affiliates, affect the right of the Company or its Affiliates to discharge or
discipline such Optionee at any time, or affect any right of such Optionee to terminate his or her
Employment at any time.

     10. Provisions of the Plan. This Option is subject in its entirety to the provisions
of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the
date of the grant of this Option has been furnished to the Optionee. By exercising all or any part
of this Option, the Optionee agrees to be bound by the terms of the Plan and this Option. In the
event of any conflict between the terms of this Option and the Plan, the terms of this Option shall
control. Notwithstanding anything set forth in the Plan to the contrary, however, in the event of
the payment of any extraordinary cash dividend on Shares (a “Special Dividend Payment”), the
Optionee shall be entitled to receive (i) a payment in an amount equal to the cash dividends the
Optionee would have received (a “Dividend Equivalent Payment”), if the Optionee held as a Stock
holder the same number of Shares, as are, as of the date of such Special Dividend Payment, subject
to any vested Options hereunder, which payment shall be made at the same time as such Special
Dividend Payments are made; (ii) with respect to any Shares subject to any unvested Options on the
date of such Special Dividend Payment, a Dividend Equivalent Payment on such Shares, to be paid at
such time(s) as such Optionee becomes vested in such Options. Notwithstanding Section 9 of the
Plan, the Administrator shall not, in order to avoid liability accounting as provided therein,
revoke or reduce the amount of any Award, but may impose reasonable terms and conditions on the
exercise of put rights, call rights and other transactions as

4

 

may be reasonably necessary to avoid the treatment of the grant as a liability award under
FASB. Notwithstanding Section 9 of the Plan, the Administrator shall not, without the
Participant’s consent, alter the terms of the Plan or this Agreement so as to adversely affect the
Participant’s rights under this Agreement.

     11. Definitions. The initially capitalized terms Optionee and Grant Date shall have
the meanings set forth on the first page of this Agreement; initially capitalized terms not
otherwise defined herein shall have the meaning provided in the Plan and the Equityholders
Agreement, and, as used herein, the following terms shall have the meanings set forth below:

     “Change of Control” means any of the following: (i) the sale of all or substantially
all of the assets of the Company, to a person (or group of persons acting in concert) that is not
an affiliate of an Investor; (ii) a sale by the Company, any Investor or any affiliate of an
Investor of Stock that results in more than 50% of the Stock of the Company (or any resulting
company after a merger) being held by a person (or group of persons acting in concert) that does
not include any Investor or any of their respective affiliates; or (iii) a private sale, or series
of private sales (or other transactions), by the Company, any Investor or any affiliate of an
Investor, after which the Investors owns less than 25% of the Stock of, and has the ability to
appoint only five or fewer directors to the Board of, the Company (or any resulting company after a
merger).

     “Cause” has the meaning set forth in the Employment Agreement.

     “Disability” has the meaning set forth in the Employment Agreement.

     “Employment” for purposes of this Agreement only, means employment on a continuous and
substantially full-time basis (exclusive only of vacation and other approved absences) and excludes
any period of employment during which services are performed on an intermittent or mutually agreed
basis in a consulting capacity.

     “Employment Agreement” shall mean the employment agreement entered into between the
Company and the Optionee dated ___, 200___.

     “Good Reason” has the meaning set forth in the Employment Agreement.

     “Investor Shares” has the meaning set forth in the Equityholders Agreement and shall
include any stock, securities or other property or interests received by the Investors in respect
of Investor Shares in connection with any stock dividend or other similar distribution, stock split
or combination of shares, recapitalization, conversion, reorganization, consolidation, split-up,
spin-off, combination, repurchase, merger, exchange of stock or other transaction or event that
affects the Company’s capital stock occurring after the date of issuance.

     “Investors” has the meaning set forth in the Equityholders Agreement.

     “Retirement” means an Optionee’s retirement from service with the Company (i) after
attaining 62 years of age or (ii) after attaining 60 years of age and completing thirty-six (36)

5

 

months of service following [    ]2.

     “Return to Investor” means the return to the Sponsors, measured in the aggregate, on
their cash investment to purchase Investor Shares, taking into account the amount of all cash
dividends and cash distributions to such Sponsors in respect of their Investor Shares and all cash
proceeds to such Sponsors from the sale or other disposition of such Investor Shares.

     “Sponsors” shall mean Bain Capital (CC) IX L.P. and its Affiliates and THL Equity Fund
VI, L.P. and its Affiliates.

     “Stock” means [Class A Common Stock of BT Triple Crown Capital Holdings III, Inc, par
value $.001 per share.]

     12. General. For purposes of this Option and any determinations to be made by the
Administrator or Compensation Committee, as the case may be, hereunder, the determinations by the
Administrator or Compensation Committee, as the case may be, shall be binding upon the Optionee and
any transferee.

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

	 	 	 	 	 	 	 
	 	 	BT TRIPLE CROWN CAPITAL HOLDINGS III, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	 
 

Name:
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Acknowledged and Agreed
	 	 	 	 	 	 
	 
 

Name:

	 	 	 	 	 	 
	 
	Address of Principal Residence:
	 	 	 	 	 	 
	 
 

	 	 	 	 	 	 
	 
 

	 	 	 	 	 	 
	 
 

	 	 	 	 	 	 

 

			
	2	 	Closing Date.

6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}]]