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Cumulus Media Bankruptcy Incentive Program Filed

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Cumulus Media filed with the U.S. Bankruptcy Court a motion authorizing the Debtors to continue certain pre-petition incentive compensation programs.

The motion explains, “Currently, 11 individuals participate in the short-term and/or long-term incentive programs (the ‘Quarterly Incentive Plan’ or ‘QIP,’ and the ‘Supplemental Incentive Plan’ or ‘SIP’, respectively), four of whom are ‘insiders’ pursuant to section 101(31) of the Bankruptcy Code; the remaining employees eligible under the programs are not insiders. Each one of the Incentive Compensation Programs, including the QIP and SIP, is based on achieving financial or operational performance targets. Each of the performance targets supports achievement of Board-approved consolidated Company EBITDA budgets, and many of the programs (including the QIP and the SIP) have as targets Board-approved consolidated Company EBITDA budgets of $210 million in 2017 and $236 million in 2018 (the ‘Board-Approved EBITDA Targets’).”

In addition, “The 2018 Board-Approved EBITDA Target, which represents a 12% increase over the 2017 Board-Approved EBITDA Target, is a challenging target for the Debtors to meet, particularly in light of current industry headwinds….[T]he Board approved an ambitious EBITDA target for the QIP and SIP of $236 million in 2018, a 12% increase over the comparable 2017 EBITDA target, which EBITDA target is also supported by the 2018 performance targets specific to the other Incentive Compensation Programs….To align compensation with performance, as part of their employment agreements, most of the Debtors’ market leadership employees are eligible to participate in a program that has an ‘at risk’ compensation feature (the ‘Market Manager Incentive Compensation Program’) based on the following standard formula:  50% of total bonus opportunity: an amount equal to 4.125% or 5.5% of annual salary is payable quarterly based on the achievement of quarterly market-level EBITDA targets; and – 50% of total bonus opportunity: an amount equal to 16.5% or 22% of annual salary is payable annually based on the achievement of annual market-level EBITDA targets.”

The SIP motion continues, “The six (6) eligible employees under the SIP are: (a) the Debtors’ CEO, CFO and general counsel, (b) the President of Westwood One, and (c) the two executive vice presidents who manage the operations of the Radio Station Group (collectively, the ‘SIP Participants’).” The Court scheduled a February 8, 2018 hearing to consider the motion, with objections due by February 1, 2018.

Read more Cumulus Media bankruptcy news.

The post Cumulus Media Bankruptcy Incentive Program Filed appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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