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Exhibit 10.17
FOURTH AMENDMENT TO SECOND AMENDED
AND RESTATED STOCKHOLDERS AGREEMENT
This FOURTH AMENDMENT TO SECOND AMENDED AND RESTATED STOCKHOLDERS
AGREEMENT (this "Fourth Amendment") is made as of October 15, 1997 by and among
CITADEL COMMUNICATIONS CORPORATION, a Nevada corporation (the "Company"); ABRY
BROADCAST PARTNERS II, L.P., a Delaware limited partnership ("ABRY");
ABRY/CITADEL INVESTMENT PARTNERS, L.P., a Delaware limited partnership
("ABRY/CIP"); BAKER, FENTRESS & COMPANY, a Delaware corporation ("BFC");
OPPENHEIMER & CO., INC., a Delaware corporation ("Oppenheimer"); BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as successor by merger to Bank
of America Illinois, which was formerly known as Continental Bank, N.A.
("BofA"); CHRISTOPHER J. PERRY, ROBERT F. PERILLE, M. ANN O'BRIEN, FORD S.
BARTHOLOW, JEFFREY M. MANN, MATTHEW W. CLARY, SHERYL E. BARTOL, and ANDREA P.
JOSELIT (Bartol and Joselit being successors in interest to Thomas E. Van Pelt,
Jr.) (collectively, the "BofA Co- Investors"); FINOVA CAPITAL CORPORATION, a
Delaware corporation ("FINOVA"); THE ENDEAVOUR CAPITAL FUND LIMITED
PARTNERSHIP, an Oregon limited partnership ("Endeavour"); JOSEPH P. TENNANT,
THE SCHAFBUCH FAMILY TRUST u/a/d 2-15-94, BABSON CAPITAL PARTNERS LIMITED
PARTNERSHIP, an Oregon limited partnership; TAL JOHNSON, EDWARD T. HARDY, and
RALPH W. MCKEE (collectively, the "Endeavour Co-Investors"); PHILIP J. URSO
("Urso"); PHILLIP NORTON, RICHARD POHOLEK, KAREN KUTNIEWSKI, PAT BOWEN, TOM
JENKINS, JULIET RICE, JEFF THOMPSON, M. LINDA URSO and MARK URSO (collectively,
the "Urso Co-Investors"); TED L. SNIDER, SR. ("T. Snider"); JANE J. SNIDER
("J. Snider"), TED L. SNIDER, JR. ("D. Snider"), and CALVIN G. ARNOLD
("Arnold", and collectively with T. Snider, J. Snider and D. Snider, the
"Snider Co- Investors"); and LAWRENCE R. WILSON (the "Executive"), and CLAIRE
WILSON ("CW").
RECITALS
A. As of June 28, 1996, the Company and certain other parties entered into
that certain Securities Purchase and Exchange Agreement (the "Securities
Purchase and Exchange Agreement"). In connection with the execution of the
Securities Purchase and Exchange Agreement, that certain Second Amended and
Restated Stockholders Agreement dated as of June 28, 1996 (as later amended by
the First Amendment to Second Amended and Restated Stockholders Agreement dated
as of December 31, 1996, the Second Amendment to the Second Amended and
Restated Stockholders Agreement dated as of March 17, 1997 and the Third
Amendment to the Second Amended and Restated Stockholders Agreement dated as of
September 26, 1997, the "Stockholders Agreement") was executed by the parties
thereto. Capitalized terms that are not otherwise defined herein shall have
the meanings ascribed to those terms in the Stockholders Agreement.
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B. In connection with the execution of the First Amendment to the Second
Amended and Restated Stockholders Agreement dated as of December 31, 1996, the
Company, the Investors, Wilson, Endeavor and the Endeavour Co-Investors
executed the Stockholders Agreement. In connection with the execution of the
Third Amendment to the Second Amended and Restated Stockholders Agreement dated
as of September 26, 1997, Urso and the Urso Co-Investors executed the
Stockholders Agreement.
C. The Snider Co-Investors are the respective sole owners of all of the
outstanding stock of Snider Corporation, an Arkansas corporation (owned by T.
Snider and J. Snider), and of Snider Broadcasting Corporation, an Arkansas
corporation (owned by D. Snider and Arnold) (such corporations, collectively,
the "Snider Entities"). As of June 2, 1997, the Company and Citadel entered
into Merger Agreements with the respective Snider Entities and their respective
shareholders (the "Merger Agreements"). Pursuant to the Merger Agreements, each
of the Snider Entities will merge with Citadel, with Citadel to be the
surviving corporation. In consideration of such mergers, the Snider
Co-Investors will receive Series G Preferred Stock.
D. In order to induce the Snider Co-Investors to consummate the
transactions contemplated by the Merger Agreements, the parties to this Fourth
Amendment wish to amend the Stockholders Agreement to grant the Snider
Co-Investors all of the rights (and make the Snider Co-Investors subject to all
of the obligations) as Investors under the Stockholders Agreement by amending
the Stockholders Agreement to make the Snider Co- Investors parties to the
Stockholders Agreement.
E. In connection with the transactions contemplated by the Merger
Agreements, the Company, the Snider Co-Investors, and certain other parties
have also agreed to enter into the following agreements, each of even date
herewith: that certain Third Amendment to Third Amended and Restated
Registration Rights Agreement; that certain Fourth Amendment to Securities
Purchase and Exchange Agreement; and that certain Fourth Amended and Restated
Voting Agreement (together with this Fourth Amendment, the Merger Agreements,
and the transactions contemplated thereby, the "Contemplated Transactions").
F. The parties to the Stockholders Agreement have also agreed to permit
Urso and the Urso Co-Investors to make certain transfers of Series F Preferred
Stock, and to make certain other changes to the Stockholders Agreement, and, in
this light, desire to amend this Agreement.
ACCORDINGLY, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties to this Third Amendment agree as follows:
1. Consents and Waivers. Each of the parties hereto hereby consents to
this Fourth Amendment and the inclusion of the Snider Co-Investors as
"Investors" under the
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Stockholders Agreement pursuant to the terms and conditions of this Fourth
Amendment. Further, each of the parties hereto waives in connection with the
Contemplated Transactions any preemptive rights he/she/it may possess pursuant
to Section 2 of the Stockholders Agreement.
2. Amendments.
2.1. Section 1 of the Stockholders Agreement is amended by adding the
following definitions in appropriate alphabetical order:
"Fourth Amendment" shall mean that Fourth Amendment to this Agreement
dated as of October 15, 1997 among Endeavour, the Endeavour
Co-Investors, Urso, the Urso Co-Investors, the Snider Co-Investors and
certain original parties to this Agreement.
"Majority Snider Holders" means, at any time, holders of a majority of
the Snider Underlying Common Stock.
"Series G Preferred Stock" shall mean the Series G Convertible
Preferred Stock of the Company, par value $.001 per share.
"Snider Co-Investors" shall mean and refer, individually and
collectively, to those individuals who are designated on the Signature
Pages to the Fourth Amendment as the "Snider Co-Investors."
"Snider Stock" means (i) Series G Preferred Stock held by the Snider
Co-Investors on the date of the Fourth Amendment, (ii) Class A Common
Stock issued or issuable upon conversion of any Series G Preferred
Stock described in clause (i) above, and (iii) Equity Securities of
the Company issued or issuable with respect to any Equity Securities
referred to in any of clauses (i) through (ii) above or this clause
(iii) by way of any stock dividend or stock split, or in connection
with a combination or exchange of shares, recapitalization, merger,
consolidation, reorganization or otherwise.
"Snider Underlying Common Stock" means all Snider Stock which is Class
A Common Stock. For purposes of this Agreement, any Person who holds
any Snider Stock which is not Class A Common Stock will be deemed to
be the Holder of the Class A Common Stock obtainable upon the
conversion, exercise or exchange to the fullest extent possible of
such Snider Stock (including the conversion, exercise or exchange of
all other Snider Stock directly or indirectly obtainable upon any such
conversion, exercise or exchange), without regard to any restriction
or limitation on any such conversion, exercise or exchange.
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2.2. Section 1 of the Stockholders Agreement is further amended by
modifying and/or adding the following language to the following
definitions:
2.2.1. Additional Preferred Stock. The current definition is deleted
and replaced with:
"Additional Preferred Stock" shall mean any additional shares of
preferred stock issued by the Company other than the Series A
Preferred Stock, Series B Preferred Stock, Series C Preferred Stock,
Series D Preferred Stock, Series E Preferred Stock, Series F
Preferred Stock or Series G. Preferred Stock.
2.2.2. Affiliate. Add the following sentence at the end of the
definition:
For purposes hereof, each of the Snider Co-Investors shall be deemed
"Affiliates" of one another.
2.2.3. Investor and Investors. The current definition is deleted and
replaced with:
"Investor" and "Investors" shall mean BFC, BofA, ABRY, ABRY/CIP,
Oppenheimer, Endeavour, the Endeavour Co-Investors, Urso, the Urso
Co-Investors, and the Snider Co-Investors.
2.2.4. Investor Stock. The current definition is deleted and replaced
with:
"Investor Stock" means (i) the BofA Warrants, (ii) Class B Common
Stock held by the BofA Co-Investors on the date hereof after giving
effect to the "Redemptions" and the "Reclassification" (as those
terms are defined in the Securities Purchase and Exchange Agreement),
(iii) Class B Common Stock issued or issuable upon the exercise of
the BofA Warrants, (iv) Class A Common Stock issued or issuable upon
the conversion of Class B Common Stock described in clause (ii) or
clause (iii) above, (v) Series A Preferred Stock held by BFC on the
date hereof after giving effect to such Redemptions and such
Reclassification, (vi) Class A Common Stock issued or issuable upon
the conversion of any Series A Preferred Stock described in clause
(v) above, (vii) Series B Preferred Stock held by Oppenheimer on the
date of this Agreement after giving effect to such Redemptions and
such Reclassification, (viii) Class A Common Stock issued or issuable
upon the conversion of any Series B Preferred Stock described in
clause (vii) above, (ix) the Shares (as that term is defined in the
Securities
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Purchase and Exchange Agreement), (x) Preferred Stock or Common Stock
issued or issuable upon the conversion of any Share, (xi) Common
Stock issued or issuable upon the conversion or exchange of any
Preferred Stock or Common Stock described in clause (x) above or this
clause (xi), (xii) Series E Preferred Stock held by Endeavour or by
the Endeavour Co-Investors on the date of the First Amendment, (xiii)
Class A Common Stock issued or issuable upon conversion of any Series
E Preferred Stock described in clause (xii) above, (xiv) Series F
Preferred Stock held by Urso or by the Urso Co-Investors on the date
of the Third Amendment, (xv) Class A Common Stock issued or issuable
upon conversion of any Series F Preferred Stock described in clause
(xiv) above, (xvi) Series G Preferred Stock held by the Snider
Co-Investors on the date of the Fourth Amendment, (xvii) Class A
Common Stock issued or issuable upon conversion of any Series G
Preferred Stock described in clause (xvi) above, (xviii) Equity
Securities issued or issuable with respect to any Equity Securities
referred to in any of clauses (i) through (xvii) above or this clause
(xviii) by way of any stock dividend or stock split, or in connection
with a combination or exchange of shares, recapitalization, merger,
consolidation, reorganization or otherwise, and (xix) for purposes of
Section 4 only, (A) Class C Common Stock held by FINOVA on the date
of this Agreement after giving effect to such Redemptions and such
Reclassification, (B) Common Stock issued upon the conversion of
Common Stock described in clause (A) above, and (C) Equity Securities
issued or issuable with respect to any Equity Securities referred to
in clause (A) or clause (B) above or in this clause (C) by way of any
stock dividend or stock split, or in connection with a combination or
exchange of shares, recapitalization, merger, consolidation,
reorganization or otherwise. As to any particular securities
constituting Investor Stock, such securities shall continue to
constitute Investor Stock in the hands of any permitted transferee
thereof, but will cease to constitute Investor Stock when they have
been disposed of in a Public Sale.
2.2.5. Qualified Public Offering. The current definition is deleted
and replaced with:
"Qualified Public Offering" means the closing of the issuance and
sale of Common Stock in an underwritten public offering which is
registered pursuant to the Securities Act and which results in the
receipt by the Company of cash proceeds of at least $25,000,000 (net
of applicable commissions, discounts and expenses) and in which the
offering price per share to the public (without reduction for
discounts, commissions or other charges or expenses) is consistent
with a fully-
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distributed equity valuation of the Company which is not less than
the result obtained by multiplying 10.5 by the Company's consolidated
pro forma cash flow for the four quarters following such closing (as
determined in good faith by the Board).
2.2.6. Preferred Stock. The current definition is deleted and
replaced with:
"Preferred Stock" means, collectively, the Company's Series A
Preferred Stock, Series B Preferred Stock, Series C Preferred Stock,
Series D Preferred Stock, Series E Preferred Stock, Series F
Preferred Stock, Series G Preferred Stock and Additional Preferred
Stock, and is sometimes used to refer to any of such Preferred Stock.
2.2.7. Repurchase Majority Holders. The current definition is deleted
and replaced with:
"Repurchase Majority Holders" means, at any time, any of the (a)
holders of a majority of the BFC Underlying Common Stock, (b) holders
of a majority of the ABRY Underlying Common Stock then in existence,
(c) the Majority Bank Holders, (d) the Majority Endeavour Holders,
(e) the Majority Urso Holders, and (f) the Majority Snider Holders.
2.3. Schedule A of the Stockholders Agreement is amended to include
the Snider Co-Investors as set forth in the Second Addendum to Schedule A
of the Second Amended and Restated Stockholders Agreement, a copy of which
is attached to this Fourth Amendment as Exhibit A.
2.4. The parties listed on Exhibit A attached hereto shall be deemed
parties to the Stockholders Agreement, as amended, and are deemed added to
Schedule A of the Stockholders Agreement, as amended.
2.5. The following additional Section 7.18 is added to Section 7 of
the Stockholders Agreement:
7.18 Incorporation of Recitals. The Recitals set forth in the
Fourth Amendment are incorporated herein.
3. Permitted Transferees. Notwithstanding the provisions of Section 3.4 of
the Stockholders Agreement, the parties to the Stockholders Agreement consent
to the transfers of Series F Preferred Stock to the transferees listed on Annex
1 to this Agreement conditioned upon each of the following:
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3.1. Each transfer of Series F Preferred Stock shall be completed on
November 18, 1997 or on such other date as Citadel closes its acquisition
of assets from Bear Broadcasting Company pursuant to an Asset Purchase
Agreement dated June 6, 1997; and
3.2. Each transferee executes and delivers to the Company a Joinder
Agreement, substantially in the form attached to this Fourth Amendment as
Annex 2.
4. Notices. All notices and other communications provided for or permitted
under the Stockholders Agreement shall be made pursuant to Section 12(d)
thereof to the Snider Co-Investors at the following initial addresses:
Ted L. Snider, Sr.
571 Valley Club Circle
Little Rock, Arkansas 72212
Facsimile: (501) 225-8021
With copy to: Price C. Gardner, Esq.
Friday, Eldredge & Clark
2000 First Commercial Building
400 West Capitol Avenue
Little Rock, AR 72201-3493
Facsimile: (501) 376-2147
5. Choice of Law. The General Corporation Law of the State of Nevada will
govern all issues concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and
interpretation of this Fourth Amendment and the schedules hereto will be
governed by the internal law, and not the law of conflicts, of the State of
Illinois.
6. Counterparts. This Fourth Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, with the
same effect as if all parties had signed the same document. All such
counterparts shall be deemed an original, shall be construed together and shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be duly
executed and delivered by their respective duly authorized officers on the day
and year first above written.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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[SIGNATURE PAGE FOR FOURTH AMENDMENT TO SECOND AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT]
CITADEL COMMUNICATIONS CORPORATION
By /s/ Lawrence R. Wilson
-----------------------------
Its President
---------------------------
/s/ Lawrence R. Wilson
---------------------------------
Lawrence R. Wilson
/s/ Clair Wilson
---------------------------------
Claire Wilson
ABRY BROADCAST PARTNERS II, L.P.
By ABRY CAPITAL, L.P.
Its General partner
By ABRY HOLDINGS, INC.
Its General Partner
By Andrew Banks
--------------------------
Its Attorney-in-Fact
--------------------------
ABRY/CITADEL INVESTMENT PARTNERS,
L.P.
By ABRY CAPITAL, L.P.
Its General partner
By ABRY HOLDINGS, INC.
Its General Partner
By Andrew Banks
--------------------------
Its Attorney-in-Fact
--------------------------
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[SIGNATURE PAGE FOR FOURTH AMENDMENT TO SECOND AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT]
BAKER, FENTRESS & COMPANY
By /s/ Scott E. Smith
---------------------------
Its Executive Vice President
-------------------------
OPPENHEIMER & CO., INC.
By /s/ Matthew J. Maryles
---------------------------
Its Managing Director
-------------------------
BANK OF AMERICA, NT&SA, a National
Trust and Savings Association
By /s/ Robert F. Perille
---------------------------
Its___________________________
FINOVA CAPITAL CORPORATION
By /s/ Andrew J. Pluta
---------------------------
Its Assistant Vice President
-------------------------
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[SIGNATURE PAGE FOR FOURTH AMENDMENT TO SECOND AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT]
BOFA CO-INVESTORS:
*
--------------------------
Christopher J. Perry
*
--------------------------
Robert F. Perille
*
--------------------------
M. Ann O'Brien
*
--------------------------
Ford S. Bartholow
*
--------------------------
Jeffrey M. Mann
*
--------------------------
Matthew W. Clary
*
--------------------------
Sheryl E. Bartol
*
--------------------------
Andrea P. Joselit
* By: /s/ Robert F. Perille
---------------------
Name: Robert F. Perille
Attorney-In-Fact
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[SIGNATURE PAGE FOR FOURTH AMENDMENT TO SECOND AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT]
ENDEAVOUR:
THE ENDEAVOUR CAPITAL FUND LIMITED
PARTNERSHIP
By DVS Management, Inc., Its General Partner
By /s/ John von Schlegell
--------------------------------
Its President
----------------------------
ENDEAVOUR CO-INVESTORS:
*
-----------------------------------
Joseph P. Tennant
THE SCHAFBUCH FAMILY TRUST u/a/d 2-15-
94
By: *
---------------------------
Richard M. Schafbuch, Trustee
By: *
---------------------------
Susan P. Schafbuch, Trustee
BABSON CAPITAL PARTNERS LIMITED PARTNERSHIP
By *
----------------------------
Its____________________________
*
-----------------------------------
Tal Johnson
*
-----------------------------------
Edward T. Hardy
*
-----------------------------------
Ralph W. McKee
* By: /s/ John von Schlegell
-----------------------------
Name: John von Schlegell
Attorney-In-Fact
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[SIGNATURE PAGE FOR FOURTH AMENDMENT TO SECOND AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT]
URSO:
/s/ Philip J. Urso
-----------------------------
Philip J. Urso
URSO CO-INVESTORS:
*
-----------------------------
Phillip Norton
*
-----------------------------
Richard Poholek
*
-----------------------------
Karen Kutniewski
*
-----------------------------
Pat Bowen
*
-----------------------------
Tom Jenkins
*
-----------------------------
Juliet Rice
*
-----------------------------
Jeff Thompson
*
-----------------------------
M. Linda Urso
*
-----------------------------
Mark Urso
*By: /s/ Philip J. Urso
------------------------
Name: Philip J. Urso
-----------------------
Attorney in Fact
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[SIGNATURE PAGE FOR FOURTH AMENDMENT TO SECOND AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT]
SNIDER CO-INVESTORS:
/s/ Ted L. Snider, Sr.
------------------------------
Ted L. Snider, Sr.
/s/ Jane J. Snider
------------------------------
Jane J. Snider
/s/ Ted L. Snider, Jr.
------------------------------
Ted L. Snider, Jr.
/s/ Calvin G. Arnold
------------------------------
Calvin G. Arnold
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EXHIBIT A
THIRD ADDENDUM TO SCHEDULE A OF THE SECOND
AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
SHARES OF CLASS A
COMMON STOCK ON
A
FULLY DILUTED
NAME SHARES BASIS
---- ------ -----
Ted L. Snider, Sr. 121,715 121,715
Jane J. Snider 40,571 40,571
Ted L. Snider, Jr. 109,093 109,093
Calvin G. Arnold 89,257 89,257
TOTAL (this Addendum only): 360,636
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ANNEX 1 TO
FOURTH AMENDMENT TO SECOND AMENDED
AND RESTATED STOCKHOLDERS AGREEMENT
Name: Number of Shares:
- ---- ----------------
Natale L. Urso
M. Linda Urso
Juliet Rice
Mark Urso
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