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A LETTER FROM OUR CEO AND INDEPENDENT CHAIR OF
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Dear Fellow Stockholders:
On behalf of the Board of Directors of Clear Channel Outdoor Holdings, Inc.’s Board of Directors, (“Clear Channel Outdoor”), it is our pleasure to invite you to our annual meeting of stockholders.stockholders (the “Annual Meeting”).
The past2022 was our first year together as a leadership team, and we continued to build on our strong foundation as a business. While 2022 brought unprecedentedits own share of challenges, including significant impacts from movements in foreign exchange rates, it was also a year of strong performance and progress on our strategic plan. Healthy demand from advertisers helped us continue to allrebound from the COVID-19 pandemic, with strong results led by our digital assets in the Americas and Europe. As we look to the future, we are focused on executing our digital transformation and our efforts to innovate and modernize how we do business. We are working to expand our digital footprint and give our customers the kind of experience they expect from digital media, which we believe will help us grow now and in the future.
Even as we adjustedlook ahead, we will keep a close eye on business and macroeconomic trends to ensure we are appropriately positioning our business today. Our response to the many impacts of the COVID-19 pandemic. In response,pandemic demonstrated our ability to manage costs and ensure we took a range of steps to protect and enhancehave ample liquidity on our operations with the aim of maximizing our performance near-term, while continuing to position our organization for success well into the future. We strengthened our liquidity, addressed our cost base and adjusted our sales approaches, while continuing to invest in our digital platform and data analytics products.
As a result, we believe we are well-positioned to return to growth as the worldwide recovery takes holdbalance sheet, and we emerge from the pandemic.will continue to leverage these skills as economic conditions require. With the support of our boardBoard of directorsDirectors and talented and committed team of employees, we remain focused on pursuing our ongoing priorities of revenue expansion, debt reduction,strengthening our balance sheet, free cash flow generation and investments in profitable growth.
Thank you for your continued support and confidence in Clear Channel Outdoor. We hope you will join us for our Annual Meeting webcast on May 5, 2021.3, 2023.
Sincerely,
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W. Benjamin Moreland | ||
Chief Executive Officer and Director | Chair of the Board of Directors |
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NOTICE OF
20212023
ANNUAL
MEETING OF
STOCKHOLDERS
AND
PROXY
STATEMENT
Wednesday, May 5, 20213, 2023
9:009 a.m., Eastern Time
CLEAR CHANNEL OUTDOOR HOLDINGS, INC.
4830 North Loop 1604W, Suite 111
San Antonio, Texas 78249
As a stockholder of Clear Channel Outdoor Holdings, Inc. (“Clear Channel Outdoor” or the “Company”), you are hereby given notice that the annual meetingAnnual Meeting of stockholders of Clear Channel Outdoor will be held by means of a live webcast, at www.meetingcenter.io/241105734meetnow.global/MTUQGHX, on May 5, 2021,3, 2023 at 9:009 a.m. Eastern Time for the following purposes:
1. | to elect |
2. | to approve an advisory resolution on executive compensation; |
3. | to approve an advisory vote on the |
4. | to ratify the selection of Ernst & Young LLP as the independent registered public accounting firm of Clear Channel Outdoor for the year ending December 31, |
5. | to transact any other business |
Only stockholders of record at the close of business on March 9, 20217, 2023 are entitled to notice of, and to vote at, the annual meeting.Annual Meeting.
If you plan to attend the annual meeting,Annual Meeting, please follow the voting and registration instructions set forth in thisthe accompanying proxy statement.statement (the “Proxy Statement”).
Your attention is directed to the accompanying proxy statement.Proxy Statement. In addition, although mere participation in the annual meetingAnnual Meeting will not revoke your proxy, if you participate in the annual meetingAnnual Meeting webcast, you may revoke your proxy and vote during the meeting. To ensure that your shares are represented at the annual meeting,Annual Meeting, please submit your vote by Internet, telephone or mail, whether or not you plan to attend the annual meeting.Annual Meeting.
By Order of the Board of DirectorsDirectors:
Lynn A. Feldman
Executive Vice President, General Counsel andChief Legal Officer & Corporate Secretary
San Antonio, Texas
March 17, 202116, 2023
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF
The Proxy Statement and Annual Report are available at:
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Table of ContentsTABLE OF CONTENTS
Notice and Proxy Statement
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This summary highlights information you will find in this Proxy Statement. As it is only a summary, please review the complete Proxy Statement before you vote.
20212023 Annual Meeting Information
Date and Time: Wednesday, May
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| Record Date: March | Proxy Mail Date: On or about March |
HOW TO VOTE
By Internet: Visit the website listed on your proxy card |
By Phone: Call the telephone number on your proxy card |
By Mail: Sign, date and return your proxy card in the enclosed envelope
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During the Annual Meeting: Participate in the Annual Meeting webcast
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Voting: | Each share of Clear Channel Outdoor common stock is entitled to one vote for each director nominee and one vote for each of the other proposals to be voted on. | |
Admission: | Admission to the Annual Meeting is limited to stockholders as of |
ANNUAL MEETING AGENDA AND VOTE RECOMMENDATIONS
Matter
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Proposal 1 | Election of Directors |
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Advisory Resolution on Executive Compensation |
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Proposal 3 |
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Proposal 4 |
Ratification of the selection of Ernst & Young LLP as the independent registered public accounting firm for the year ending December 31, |
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In this Proxy Statement, “we,” “our,” “us,”“we”, “our”, “us”, “CCOH”, “Clear Channel Outdoor” and the “Company” refer to Clear Channel Outdoor Holdings, Inc., and the “Annual Meeting” refers to the 20212023 Annual Meeting of Stockholders. We first madewill begin mailing this Proxy Statement and form of proxy card available to stockholders on or about March 24, 2021.22, 2023.
2020 BUSINESS HIGHLIGHTS
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ii Notice and Proxy Statement
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DIRECTOR NOMINEES
Below is information about each of our Director nominees:director nominees, as of March 7, 2023:
Name | Age | Experience(s) | |||||||||||||
Director | Committee Memberships | ||||||||||||||
John Dionne | 59 | Senior Advisor at Blackstone Group, L.P. | ✓ | AC, NCGC | |||||||||||
Lisa Hammitt | 60 | Former Executive Vice President, Artificial Intelligence and Chief Technology Officer at Davidson Technologies | ✓ | CC, NCGC | |||||||||||
Andrew Hobson | 61 | Partner and Chief Financial Officer at Innovatus Capital Partners, LLC | ✓ | AC | |||||||||||
Thomas C. King | 62 | Operating Partner at Atlas Merchant Capital | ✓ | CC | |||||||||||
Joe Marchese | 41 | Co-Founder and Executive Chairman of Human Ventures | ✓ | CC, NCGC | |||||||||||
W. Benjamin Moreland « | 59 | Private investor and retired Chief Executive Officer at Crown Castel International Corp. | ✓ | None | |||||||||||
Mary Teresa Rainey | 67 | Founder of Rainey, Kelly Campbell Roalfe/48R | ✓ | AC, NCGC | |||||||||||
Scott R. Wells | 54 | Chief Executive Officer at Clear Channel Outdoor | None | ||||||||||||
Jinhy Yoon | 50 | Executive Vice President, Credit Research at PIMCO | None |
« = Chair of the Board
AC = Audit Committee
CC = Compensation Committee
NCGC = Nominating and Corporate Governance Committee
CORPORATE GOVERNANCE HIGHLIGHTS
The Board of Directors (the “Board”) of Clear Channel Outdoor believes that good governance is key to achieving long-term stockholder value and that the Company’s long-term success requires the Company’s commitment to a robust framework of guidelines and practices that servesserve the best interestinterests of the Company and all of our stockholders. Below are some key highlights of our corporate governance framework:
Board Practices
✓ 7 out of 9 of our directors are independent.
✓ The Board is led by an independent, non-executive Chair.
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✓ All members of our Audit, Compensation and Nominating and Corporate Governance Committees are independent as defined by the NYSE listing standards and applicable SEC rules.
✓ Each Board committee operates under a written charter that has been approved by the Board and is reviewed and, if necessary, amended annually.
✓ The Board conducts periodic executive sessions, where non-executive and independent directors meet without management.
✓ The Nominating and Corporate Governance Committee oversees an annual self-evaluation process for the Board and each standing committee of the Board and is responsible for proposing any modification or alterations | Compensation Practices
✓ Robust annual risk assessment of executive compensation programs, policies and practices.
✓ Comprehensive cash and equity claw-back policy for senior executives.
✓ Significant stock ownership requirements for senior executives and directors.
Stockholder Matters
✓ Robust stockholder engagement.
✓ Annual Say-on-Pay voting.
Other Governance Practices
✓ Our Code of Business Conduct and Ethics, which applies to all Clear Channel Outdoor employees, as well as our executive officers and
✓ |
Notice and Proxy Statement
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CORPORATE SOCIAL RESPONSIBILITY AND ENVIRONMENTAL, SOCIAL AND GOVERNANCE INITIATIVES
Clear Channel Outdoor’sOur Board and management team are committed to the Company’s guiding principle of making a difference in the communities we serve. We are united across our business units by the common purpose of “creating a better world through our people-powered platform”. Together, we strive to improve the communities in which we operate through innovation, dedication and good governance.
ESG is integrated across CCOH’s strategic and operational endeavors. The ultimate responsibility and oversight for the Company’s ESG initiatives lies with the Board’s Nominating and Corporate Governance Committee. In addition, the Board’s Audit Committee oversees risk, including climate-related, HR, compliance, privacy and information security risks, and the Board’s Compensation Committee oversees our human capital management initiatives. On an operational level, CCOH’s legal and compliance business functions report directly to the Board and its standing committees on ESG matters and compliance initiatives. Further, the Global Compliance Office coordinates regional ESG Programs with executive oversight, and senior leaders in divisional governance committees oversee local ESG programs across the Company.
In December 2022, Clear Channel Outdoor strivespublished its most recent ESG Report (the “2022 ESG Report”), which details how we strive to behave ethically and responsibly as a company, an employer and a business partner and how we endeavor to use our resources and products to drive meaningful change. We believe addressingchange in the challenges that affect people’s daily livescommunities in which we operate. For more information on our ESG policies, practices, initiatives and accomplishments, please see our 2022 ESG Report, which is critical for influencing greater societal change. In furtheranceavailable at www.investor.clearchannel.com. None of our goal2022 ESG Report, our websites or the information included therein is a part of, or incorporated by reference into, this Proxy Statement.
Some of our ESG highlights to drive change, we donate public service advertising (PSA) on an annual basis to nonprofit and governmental organizations for their use in communicating information that positively affects the lives of those within our communities. In addition, our support extends to both local and national organizations as they:date include:
improve health and public safety;
ensure a sustainable environment;
promote arts, education and cultural diversity; as well as
support market-by-market advertising standards.
This collaboration works to inspire citizens to make a difference within their own communities, and helps us to meet our commitment to being a responsible business, which creates value for our clients, our communities, our people and, ultimately, our stockholders.
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• | • Continuing our efforts on diversity and inclusion (“D&I”) with regular D&I training and by establishing D&I committees across all of
• (i) the Executive Diversity Advisory Council in the U.S., which is sponsored by executive management and works to advance CCOA’s D&I efforts with |
(iii) Implementing employee surveys across multiple regions and business units to gather insights on diversity and inclusion | |
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iv Notice and Proxy Statement
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Commitment to Environmental Sustainability
We are focused on operating our business in ways that minimize the potential for causing harm to the environment, and as part of our Global Environmental Program, we are committed to Carbon Net Zero by 2050 (with many of our business units on target to reach this goal by 2030) and are committed to employing ecologically friendly materials and operational procedures.
We strive for 100% of our posters and bulletins to be converted to recyclable Polyethylene (PE) Substrates and recycled annually in the U.S.
We measure our recycling and waste diversion from landfill rates across our business.
Up to 98% of our digital billboard components are recyclable.
We converted over 98% of our illuminated display panels and over 75% of our illuminated transit shelter displays in the U.S. to LED lighting, decreasing energy consumption by more than 60% across a three year period, and are working toward full conversion in 2021.
35% of our business by revenue is certified or benchmarked against ISO 14001 standards, and continued adoption of this standard is a goal of our Global Environmental Program.
Starting in 2021 in our European and Latin American businesses, we are committed to purchasing 100% renewable electricity with intention to reduce our Scope 1 and 2 emissions.
Ethics and Compliance
Clear Channel Outdoor is committed to maintaining the highest standards of compliance, ethics, honesty, openness and accountability in our business operations. We maintain a Code of Business Conduct & Ethics (the “Code”) that sets forth standards for our officers, directors, employees, interns, contractors and agents throughout our corporate structure. Training on the Code is mandatory upon employment, and we require completion of additional trainings covering certain topics contained in the Code on a periodic basis. Highlights from our Code, and its underlying policies and procedures,
and targets, as well as environmental initiatives tailored to specific regions by specific business units. Select examples include:
• Up to 98% of Clear Channel Outdoor Americas’ (“CCOA”) digital billboards components are estimated as recyclable. CCOA has converted 99% of all metal halide and fluorescent fixtures in its billboards to more energy-efficient LED lighting. • In 2022, Clear Channel United Kingdom purchased all electricity for use in its premises and street furniture from 100% renewable sources. • Clear Channel Europe has agreed to contract with renewable energy providers in all new energy contracts (from 2021 onward). • Clear Channel Europe has introduced hybrid and electric vehicles in key fleets. • Clear Channel Europe has developed auto-dimming backlights to dim and turn off the backlights on displays to reduce power consumption in digital assets during quiet periods. | preferences and to help guide and prioritize our efforts; • Seeking to support efforts to increase social and racial justice and equality by providing free media space and charitable contributions and engaging in collaborations with charity partners; • Helping local and national governments and nongovernmental organizations to make public safety announcements, including in response to COVID-19 and the war in Ukraine; • Adopting our Supplier Code of Conduct and implementing contractual clauses used across our business, requiring key suppliers to operate at a high ethical standard; • Establishing policies on nondiscriminatory compensation and hiring practices that prohibit discriminatory employee reward decisions based on an employee’s intersectionality (e.g., gender, race, class, caste, sexuality, religion, disability or physical appearance); • Adopting a Global Human Rights Policy that details our position on human rights, with annual trainings required for all employees; • Working to promote the health and safety of our employees, including our field workers, by developing safety programs and systems that are regularly inspected and independently audited; and • Seeking to improve the mental health of our employees with mental health programs across our regions, including our Mental Health Allies program. | approximately 11% of CCOH’s directors are racially diverse; • Annual Say-On-Pay voting; • Focusing on data privacy and cybersecurity through impact assessments and cybersecurity programs and policies, auditing and annual cyber security awareness training, all overseen by our dedicated Privacy Office (including a European/UK Chief Data Protection Officer) and cybersecurity teams; and • Robust internal governance program for employees, executives and directors, underpinning our Code of Business Conduct and Ethics with mandatory regular training, due diligence and risk management programs tailored to each division and a global anti-corruption and sanctions program, all supported by an independent whistleblowing hotline. |
Notice and Proxy Statement
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OUR PEOPLE
Advancing Diversity and Inclusion
Clear Channel Outdoor is an equal opportunity employer and is committed to providing a work environment that is free of discrimination and harassment. We respect and embrace diversity of thought and experience and believe that a diverse workforce produces more innovative insights and solutions, resulting in better products and services for our customers. As we bring brands face-to-face with people, we believe our teams need to be as diverse in their composition and outlook as the audiences we reach every day, and we work together to create an inclusive environment where everyone can bring their true selves to work.
We have an ongoing priority to enhance diversity of our workforce and have implemented diversity and inclusion strategies across our global business. Amidst calls for sociopolitical change we have seen play out in all corners of the world, we have reinforced our commitment to our people and to promoting diversity and inclusion, as well as the need to do more to continue improving and evolving as an organization. In an effort to further promote a diverse and inclusive environment, we have launched the Executive Diversity Advisory Council in the U.S., implemented the International Fairness program in Europe and Latin America, and surveyed employees globally to gather insights on diversity and inclusion preferences to help guide and prioritize our efforts.
Commitment to Safety and Wellness
Safety is one of our core values, and we are committed to providing our employees with a safe workplace and prioritizing the physical and mental health and well-being of our employees. One of the ways in which we do this is by offering an Employee Assistance Program (“EAP”), which gives employees access to licensed professional counselors and other specialists at no cost for help with balancing work and life issues. We have also implemented an Employee Relief Fund to help employees facing financial hardship immediately after a disaster or during unanticipated and unavoidable personal emergencies.
In response to the COVID-19 pandemic, we implemented significant changes that we determined were in the best interest of our employees and the communities in which we operate and which comply with government regulations. This included transitioning the vast majority of our employees to work-from-home for a large portion of 2020, while implementing additional safety measures for employees continuing critical on-site work. In recent months, we have started to execute on our phased Return-to-Office plan on an office-by-office basis, ensuring compliance with applicable regulations as well as local health authority guidance and implementing robust safety procedures and protocols to protect our employees. Given the evolving-nature of COVID-19 developments, our Return-to-Office plan is nimble, allowing each office the flexibility to return to work-from-home directives as necessary based on local conditions.
In line with our priority of protecting the safety, health and well-being of our employees, we surveyed our employees in May 2020 to determine how we could more effectively provide support. This survey, administered by a third party, focused on the following areas: concern and connection; virtual work effectiveness; senior leadership response and communication; and employee wellness, health and safety. Utilizing the results of this survey, we developed an action plan to help our employees face the challenges of COVID-19 and remain engaged and productive, including communicating the availability of counseling under the EAP through company-wide notifications and HR portal updates, providing COVID-19 related resources on locating vaccines, work from home health tips and COVID-19 trainings, among other things, and regular communication of our progress through all-hands meetings, regional and departmental meetings and other forms of communication.
Compensation and Benefits Programs
Our compensation and benefits programs are designed to attract and reward talented individuals who possess the skills necessary to support our business objectives, assist in the achievement of our strategic goals and create long-term value for our stockholders. We provide employees with compensation packages that include base salary and annual incentive bonuses tied to Company and division performance, in line with our pay-for-performance philosophy. Our sales employees are incentivized through sales commission programs, with our highest performing individuals further awarded through formal recognition programs. Our executives and certain other employees receive long-term equity awards that vest based on our relative total shareholder return or over a defined period. We believe
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that a compensation program with both short-term and long-term awards provides fair and competitive compensation and aligns employee and stockholder interests.
We also provide our employees and their families with access to a variety of healthcare and insurance benefits, qualified spending accounts, retirement savings plans and various other benefits.
EXECUTIVE COMPENSATION HIGHLIGHTS
Our Compensation Committee, with support from our independent compensation consultant, periodically evaluates our compensation practices to ensure that they support the objectives of our business, align with market practicepractices and provide incentive to deliver key financial metrics that are explicitly linked with stockholder value creation. Certain highlights for 20202022 include:
• | We continued our practice of annual incentive plan awards tied to Company, |
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Clear Channel Outdoor Holdings, Inc.
20212023 Proxy Statement
This proxy statementProxy Statement contains information related to the annual meeting of stockholdersAnnual Meeting of Clear Channel Outdoor Holdings, Inc. (referred to herein as “Clear Channel Outdoor,” “CCOH,” “Company,” “we,” “our” or “us”) to be held on Wednesday, May 5, 2021,3, 2023, beginning at 9:009 a.m. Eastern Time, at www.meetingcenter.io/241105734, meetnow.global/MTUQGHX, and at any postponements or adjournments thereof. On or about March 24, 2021,22, 2023, we will begin to mail to our stockholders either a notice containing instructions on how to access this proxy statementProxy Statement and our annual report online or a printed copy of these proxy materials. The Company will bear the costs of preparing and mailing the proxy materials and other costs of the proxy solicitation made by the Board of Directors of Clear Channel Outdoor (the “Board”).Board.
QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING
Q: | WHY AM I RECEIVING THESE MATERIALS? |
A: | Clear Channel Outdoor is making these proxy materials available to you via the Internet or, upon your request, has delivered printed versions of these proxy materials to you by mail in connection with Clear Channel Outdoor’s |
Q: | WHY DID I RECEIVE A NOTICE IN THE MAIL REGARDING THE INTERNET AVAILABILITY OF PROXY MATERIALS INSTEAD OF A FULL SET OF PHYSICAL PROXY MATERIALS? |
A: | As permitted by U.S. Securities and Exchange Commission (“SEC”) rules, we are making this |
Q: | WHAT PROPOSALS WILL BE VOTED ON AT THE ANNUAL MEETING? |
A: | There are four proposals scheduled to be voted on at the |
the election of the nominees for director named in this proxy statement;Proxy Statement;
the approval of an advisory resolution on executive compensation;
the approval of an advisory vote on the adoptionfrequency of the Clear Channel Outdoor Holdings, Inc. 2012 Second Amended and Restated Equity Incentive Plan;future advisory votes on executive compensation; and
the ratification of the selection of Ernst & Young LLP as Clear Channel Outdoor’s independent registered public accounting firm for the year ending December 31, 2021.2023.
Q: | WHICH OF MY SHARES MAY I VOTE? |
A: | All shares of common stock owned by you as of the close of business on |
Q: | WHAT IS THE DIFFERENCE BETWEEN HOLDING SHARES AS A STOCKHOLDER OF RECORD AND AS A BENEFICIAL OWNER? |
A: | Most stockholders of Clear Channel Outdoor hold their shares through a broker, bank or other nominee rather than directly in their own name. As summarized below, there are some distinctions between shares held of record and those owned beneficially. |
Notice and Proxy Statement
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Stockholder of Record: If your shares are registered directly in your name with Clear Channel Outdoor’s transfer agent, Computershare Trust Company, N.A. (“Computershare”), you are considered, with respect to those shares, the stockholder of record, and these proxy materials are being sent directly to you by Computershare on behalf of Clear Channel Outdoor. As the stockholder of record, you have the right to grant your voting proxy directly to Clear Channel Outdoor or to vote during the annual meeting.Annual Meeting.
Beneficial Owner: If your shares are held in a stock brokerage account or by a broker or other nominee, you are considered the beneficial owner of shares held in “street name,”name”, and these proxy materials are being forwarded to you by your broker or nominee who is considered, with respect to those shares, the stockholder of record. As the beneficial owner, you have the right to direct your broker on how to vote and are also are invited to attend the annual meeting webcast.Annual Meeting. However, since you are not the stockholder of record, you may not vote these shares during the annual meeting,Annual Meeting, unless you obtain a legal proxy from your broker, bank or other nominee giving you the right to vote the shares and register for the meeting in accordance with the instructions set forth below.
Q: | WHAT CONSTITUTES A QUORUM? |
A: | The holders of a majority of the total voting power of Clear Channel Outdoor’s common stock entitled to vote and represented in person (virtually) or by proxy will constitute a quorum at the |
Q: | IF MY SHARES ARE HELD IN “STREET NAME” BY MY BROKER, WILL MY BROKER VOTE MY SHARES FOR ME? |
A: | Under New York Stock Exchange (“NYSE”) rules, brokers have discretion to vote the shares of customers who fail to provide voting instructions on “routine |
As described above, if you do not provide your broker with voting instructions and the broker is not permitted to vote your shares on a proposal, a “broker non-vote” occurs. Broker non-votes will be counted for purposes of establishing a quorum at the annual meeting and will have no effect on the vote on any of the proposals at the annual meeting.
Q: | HOW CAN I ATTEND THE ANNUAL MEETING? |
A: | We are hosting the |
Stockholder of Record: You will be able to listen to the annual meeting,Annual Meeting, submit questions and vote by going to www.meetingcenter.io/241105734meetnow.global/MTUQGHX and clickinglogging in using your control number found on “I have a Control Number.” The password for the meeting is CCO2021.your Notice of Internet Availability of Proxy Materials or proxy card.
Beneficial Owner: If you wish to attend the annual meeting,Annual Meeting, you must register in advance. See “HOW DO I REGISTER TO ATTEND THE ANNUAL MEETING?” below.
We encourage you to access the meeting website prior to the start time to allow ample time for check in. The virtual annual meetingAnnual Meeting will begin promptly at 9:009 a.m., Eastern Time.
Q: | HOW DO I REGISTER TO ATTEND THE ANNUAL MEETING? |
A: | Stockholder of Record: You do not need to register. Follow the instructions on your Notice of Internet Availability of Proxy Materials or proxy card. See “HOW CAN I ATTEND THE ANNUAL MEETING?” above. |
2 Notice and Proxy Statement
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Beneficial Owner: If you wishhold your shares through an intermediary, such as a bank or broker, you must register in advance to attend the Annual Meeting virtually on the Internet.
To register to attend the annual meeting,Annual Meeting online by webcast you must provide our transfer agent, Computershare Trust Company, N.A. (“Computershare”)submit proof of your proxy power (legal proxy) reflecting your Clear Channel Outdoor holdings along with your name and email address and a copy of a legal proxy from your broker, bank or other nominee reflecting your beneficial stock ownership in Clear Channel Outdoor. Registration requests must be in writing and be mailed to:
By Regular Mail
PO BOX 505000
Louisville, KY 40233-5000
UNITED STATES
By Overnight Delivery
462 South 4th Street
Suite 1600
Louisville, KY 40233-5000
UNITED STATES
to Computershare. Requests for registration must be labeled as “Legal Proxy” and be received no later than 5:00 p.m., Eastern Time on April 30, 2021.28, 2023. You will receive ana confirmation of your registration by email after we receive your registration materials.
Requests for registration should be directed to us at the following:
By email: Forward the email from Computershare acknowledging your registration along with a Control Number.broker, or attach an image of your legal proxy, to legalproxy@computershare.com
By mail:
Computershare
COMPANY Legal Proxy
P.O. Box 43001
Providence, RI 02940-3001
Q: | HOW CAN I PARTICIPATE IN THE VIRTUAL ANNUAL MEETING? |
A: | If you are a stockholder as of the Record Date and have logged in using your control number, you may submit a question at any point during the meeting (until the floor is closed to questions) by typing your question on the Q&A tab and clicking “Send”. Shareholder questions or comments are welcome, but we will only answer questions pertinent to Annual Meeting matters, subject to time constraints. Questions regarding personal matters and statements of advocacy are not pertinent to Annual Meeting matters and therefore will not be addressed. Questions or comments that are substantially similar may be grouped and answered together to avoid repetition. Rules of Conduct applicable to the Annual Meeting will be accessible on the virtual meeting website during the Annual Meeting. The audio broadcast of the Annual Meeting will be archived at https://edge.media-server.com/mmc/p/sgou94gj for at least one year. |
Q: | WHAT IF I RUN INTO TECHNICAL ISSUES WHILE TRYING TO ACCESS THE ANNUAL MEETING? |
A: | The virtual meeting platform is supported across browsers and devices running the most updated version of applicable software and plug-ins. Participants should give themselves plenty of time to log in and ensure that they have a strong internet connection and that they can hear streaming audio prior to the start of the Annual Meeting. |
If you encounter technical difficulties with the virtual meeting platform on the Annual Meeting day, please call the technical support number that will be posted on the Annual Meeting website. Technical support will be available starting at 8:45 a.m. Eastern Time and until the end of the Annual Meeting.
Q: | HOW CAN I VOTE MY SHARES WITHOUT ATTENDING THE ANNUAL MEETING? |
A: | If you are a stockholder of record, you may authorize a proxy to vote your shares. Specifically, you may authorize a proxy to vote: |
• | By |
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Notice and Proxy Statement 2023 3 |
returning the proxy card in the envelope that will be provided to |
If you hold your shares in street name, you may submit voting instructions to your broker, bank or other nominee. In most instances, you will be able to do this over the Internet, by telephone or by mail. Please refer to information from your broker, bank or other nominee on how to submit voting instructions.
Q: | WHAT IF I RETURN MY PROXY CARD WITHOUT SPECIFYING MY VOTING CHOICES? |
A: | If your proxy card is signed and returned without specifying choices, the shares will be voted as recommended by the Board. |
Q: | WHAT IF I WITHHOLD MY VOTE, ABSTAIN FROM VOTING OR |
A: | If you withhold your vote on the election of directors, it will have no effect on the outcome of the vote on the election of directors. |
If you abstain from voting on the advisory vote on the frequency of future advisory votes on executive compensation, it will have no effect on the outcome of the vote on that proposal.
If you abstain from voting on (i) the approval of an advisory resolution on executive compensation (ii) the approval of the adoption of the Clear Channel Outdoor Holdings, Inc. 2012 Second Amended and Restated Equity Incentive Plan, or (iii)(ii) the ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm for the year ending December 31, 2021,2023, it will have the same effect as a vote “against” this proposal.these proposals.
Broker non-votes will have no effect on the vote on any of the proposals at the Annual Meeting.
Abstentions and broker non-votes are counted as present for purposes of determining a quorum.
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WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIALS, PROXY CARD OR VOTING INSTRUCTION CARD? |
A: | It means that your shares are registered differently or are in more than one account. Please provide voting instructions for all notices, proxy cards and voting instruction cards you receive. |
Q: | WHAT ARE THE VOTING RECOMMENDATIONS OF THE BOARD OF CLEAR CHANNEL |
A: | The Board recommends that you vote your shares “FOR”: |
the nominees for director named in this proxy statement;Proxy Statement;
the approval of anthe advisory resolution on executive compensation;
approval of the adoption of the Clear Channel Outdoor Holdings, Inc. 2012 Second Amended and Restated Equity Incentive Plan; and
the ratification of the selection of Ernst & Young LLP as Clear Channel Outdoor’s independent registered public accounting firm for the year ending December 31, 2021.2023.
The Board also recommends that you vote “ONE YEAR” with respect to the advisory vote on the frequency of future advisory votes on executive compensation.
Q: | WHAT VOTE IS REQUIRED TO ELECT THE DIRECTORS AND APPROVE EACH PROPOSAL? |
A: | The directors will be elected by a plurality of the votes properly cast. This means that the director nominees receiving the highest number of “FOR” votes will be elected as directors. The approval of an advisory resolution on executive compensation and the ratification of the selection of Ernst & Young LLP as Clear Channel Outdoor’s independent registered public accounting firm for the year ending December 31, |
4 Notice and Proxy Statement 2023 |
Q: | WHAT HAPPENS IF A NOMINEE FOR DIRECTOR IS UNABLE TO STAND FOR ELECTION DUE TO UNFORESEEN CIRCUMSTANCES? |
A: | If you vote by proxy and unforeseen circumstances make it necessary for the Board to substitute another person for a nominee, the designated proxy will vote your shares for that other person. |
Q: | WHERE CAN I FIND A LIST OF STOCKHOLDERS OF RECORD ENTITLED TO VOTE AT THE ANNUAL MEETING? |
A: | A list of stockholders of record entitled to vote at the Annual Meeting will be accessible on the virtual meeting website during the |
Q: | MAY I CHANGE MY VOTE OR REVOKE MY PROXY? |
A: | If you are a stockholder of record, you may change your vote or revoke your proxy at any time before your shares are voted at the |
Q: | WHERE CAN I FIND THE VOTING RESULTS OF THE ANNUAL MEETING? |
A: | Clear Channel Outdoor will announce preliminary voting results at the |
Q: | MAY I ACCESS CLEAR CHANNEL OUTDOOR’S PROXY MATERIALS FROM THE INTERNET? |
A: | Yes. These materials are available at www.envisionreports.com/cco. |
Q: | WILL THE ANNUAL MEETING BE RECORDED? |
A: | A replay of the meeting will be made available at www.envisionreports.com/cco. |
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The Board of Directors and Corporate Governance
Our Board is responsible for overseeing the direction of Clear Channel Outdoor and for establishing broad corporate policies. However, inIn accordance with corporate legal principles, itour Board is not involved in day-to-day operating details.activities of the Company. Members of the Board are kept informed of Clear Channel Outdoor’s business through discussions with the Company’s Chief Executive Officer, the Chief Financial Officer and other executive officers, by reviewing analyses and reports sent to them, by receiving updates from Board committees and by otherwise participating in Board and committee meetings.
COMPOSITION OF THE BOARD OF DIRECTORS
Our Board is currently comprised of nine directors, including C. William Eccleshare, ourdirectors: W. Benjamin Moreland (our Chair), Scott R. Wells (our Chief Executive Officer,Officer), John Dionne, Lisa Hammitt, Andrew Hobson, Thomas C. King, Joe Marchese, W. Benjamin Moreland, Mary Teresa Rainey and Jinhy Yoon.
COMPOSITION OF THE BOARD OF DIRECTORS
Our Board is currently divided into three classes serving staggered three year terms. Our amended certificate of incorporation provides for a phase out of the classification of the Board. Directors elected at this annual meetingAnnual Meeting will be elected for a two-yearone-year term expiring at our 2023 annual meeting of stockholders. Directors elected at our 2022 annual meeting of stockholders will be elected for a one-year term expiring at our 20232024 annual meeting of stockholders.
From and after our 2023 annual meeting of the stockholders, the Board will no longer be classified and each director will be elected for a one-year term. In case of any increase or decrease, from time to time, in the number of directors prior to our 2023 annual meeting of stockholders, other than those who may be elected by the holders of any series of preferred stock under specified circumstances, the number of directors added to or eliminated from each class will be apportioned so that the number of directors in each class thereafter shall be as nearly equal as possible, but in no case will a decrease in the number of directors constituting the Board shorten the term of any incumbent director.
In 2020,2022, the Board held 15eight meetings and also acted by written consent. All of our incumbent directors attended at least 75%more than 93% of the aggregate of all meetings of the Board held duringand the periods in which they served during 2020. All of our incumbent directors also attended at least 75%committees of the aggregate of all meetings of the Board committees on which they served during 2020.2022.
STOCKHOLDER MEETING ATTENDANCE
Clear Channel Outdoor encourages, but does not require, its directors to attend the annual meetingAnnual Meeting of stockholders. All of our directors attended the annual meeting of stockholders in 2020. In 2021, Board committee meetings will be held immediately following the annual meeting.2022.
Our Board currently consists of nine directors, one of whom currently serves as our Chief Executive Officer. For a director to be independent, the Board must determine that such director does not have any direct or indirect material relationship with Clear Channel Outdoor. Pursuant to our governance guidelines (the “Governance Guidelines”), the Board has undertaken its annual review of director independence.
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The Board has adopted the following standards for determining the independence of its members:
1. A director must not be, or have been within the last three years, an employee of Clear Channel Outdoor. In addition, a director’s immediate family member (“immediate family member” is defined to include a person’s spouse, parents, children, siblings,
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2. A director or immediate family member must not have received, during any
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3. A director must not be a current partner or employee of a firm that is Clear Channel Outdoor’s internal or external auditor. In addition, a director must not have an immediate family member who is (a) a current partner of such firm or (b) a current employee of such a firm and personally works on Clear Channel Outdoor’s audit. Finally, neither the director nor an immediate family member of the director may have been, within the last three years, a partner or employee of such a firm and personally worked on Clear Channel Outdoor’s audit within that time.
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4. A director or an immediate family member must not be, or have been within the last three years, employed as an executive officer of another company where any of Clear Channel Outdoor’s present executive officers at the same time serve or served on that company’s compensation committee.
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5. A director must not be a current employee, and no director’s immediate family member may be a current executive officer, of a material relationship party (“material relationship party” is defined as any company that has made payments to, or received payments from, Clear Channel Outdoor for property or services in an amount
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6. A director must not own, together with ownership interests of his or her family, ten percent (10%) or more of a material relationship party.
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7. A director or immediate family member must not be, or have been during the last three years, an executive officer of a charitable organization (or hold a similar position), to which Clear Channel Outdoor makes contributions in an amount
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8. A director must be “independent” as that term is defined from time to time by the rules and regulations promulgated by the SEC, by the listing standards of the NYSE and, with respect to at least two members of the compensation committee, by the applicable provisions of, and rules promulgated under, the Internal Revenue Code of 1986, as amended (collectively, the “Applicable Rules”). For purposes of determining independence, the Board will consider relationships with Clear Channel Outdoor and any parent or subsidiary in a consolidated group with Clear Channel Outdoor or any other company relevant to an independence determination under the Applicable Rules.
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The above independence standards conform to, or are more exacting than, the director independence requirements of the NYSE applicable to Clear Channel Outdoor. The above independence standards are set forth on Appendix A of the Governance Guidelines.
The Board has affirmatively determined that all current directors (other than Mr. EccleshareWells and Ms. Yoon) are independent under the listing standards of the NYSE, as well as Clear Channel Outdoor’s independence standards set forth above. In addition, the Board has determined that each member currently serving on the Compensation Committee and on the Audit Committee is independent under the heightened independence standards for compensation or audit committee members under the listing standards of the NYSE and the rules and regulations of the SEC, and that each member currently serving on the Audit Committee is independent under the heightened independence standards required for audit committee members by the listing standards of the NYSE and the rules and regulations of the SEC.as applicable. In making these determinations, the Board reviewed information provided by the directors and by Clear Channel Outdoor with regard to the directors’ business and personal activities as they relate to Clear Channel Outdoor and its affiliates.
In the ordinary course of business during 2020,2022, Clear Channel Outdoor entered into purchase and sale transactions for
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products and services and other ordinary course transactions with certain entities affiliated with members of the Board as described below, and the following transactions were considered by the Board in making their independence determinations with respect to Mr. Dionne, Mr.Mses. Hammitt and Yoon and Messrs. Hobson, King, Marchese Mr. Hobson and Mr. Moreland:
a subsidiary of a company for which Mr. Dionne servedMses. Hammitt and Yoon serve as achairwoman and director, respectively, paid us approximately $1,504,313$48,206 during 20202022 for outdoor advertising services;
a family member of Ms. Hammitt is employed by a company, which paid us approximately $47,482 during 2022 for outdoor advertising services;
a company for which Mr. MarcheseHobson serves as a partner/co-founderchairman of the board of directors paid us approximately $46,454$12,845 during 20202022 for outdoor advertising services;
a client of a consulting company for which Mr. MarcheseKing serves as chief executive officera director paid us approximately $79,250$188,489 during 20202022 for outdoor advertising services;
a company for which Mr. Marchese serves as a director paid us approximately $771,297$1,102,691 during 20202022 for outdoor advertising services,services;
a client of a company for which Mr. Marchese serves as the chief executive officer paid us approximately $3,960 during 2022 for outdoor advertising services;
two charitable organizations with which Mr. Marchese is affiliated paid us approximately $3,221 and we made a refund to the same company in the amount of approximately $62,917;$90,000, respectively, during 2022 for outdoor advertising services;
a company for which Mr. Moreland serves as a director paid us approximately $79,048$97,099 during 20202022 for rental fees,ordinary course easements, and we paid that company $2,200approximately $2,400 for rental fees;ordinary course site leases; and
a hospital system for which Mr. Moreland serves as a director paid us approximately $1.3 million$1,352,797 during 2020 for outdoor advertising services; and
a company for which Mr. Hobson serves as a director paid us $112,905 during 20202022 for outdoor advertising services.
Notice and Proxy Statement 2023 7 |
All of the payments described above arewere for arms-length, ordinary course of business transactions, and we generally expect transactions of a similar nature to occur during 2021.2023. The Board has concluded that such transactions or relationships do not impair the independence of the directors.Mses. Hammitt and Yoon and Messrs. Hobson, King, Marchese and Moreland.
The rules of the NYSE require that non-management or independent directors of a listed company meet periodically in executive sessions. In addition, the rules of the NYSE require listed companies to schedule an executive session including only independent directors at least once a year. Clear Channel Outdoor’s independent directors met separately in executive session at least one time during 2020.2022. Mr. Moreland, the independent Chair of the Board, presides over all such executive sessions.
The Board has three standing committees: (i) the Audit Committee, (ii) the Compensation Committee and (iii) the Nominating and Corporate Governance Committee. Each committee consists solely of independent directors and is governed by a written charter. The committee charters are available on our website at www.investor.clearchannel.com.www.investor.clearchannel.com.
The table below provides membership information for each committee of the Board as of December 31, 2020:March 7, 2023:
Board Committee Membership
Director Name | Audit Committee | Compensation Committee | Nominating and Corporate Governance Committee | Audit Committee | Compensation Committee | Nominating and Corporate Governance Committee | ||||||||||||||||||||||||
C. William Eccleshare
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Scott R. Wells
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John Dionne
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Lisa Hammitt
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Andrew Hobson
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Thomas C. King
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Joe Marchese
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W. Benjamin Moreland
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W. Benjamin Moreland «
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Mary Teresa Rainey
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Jinhy Yoon
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2020 Meetings Held
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8
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7
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4
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Meetings Held in 2022
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5
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7
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4
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« = Chair of the Board = Committee Chair = Committee member
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The Audit Committee
The Audit Committee consists of Andrew Hobson, Mary Teresa Rainey and John Dionne, each of whom is independent as defined under the rules of the NYSE and Rule 10A-3 of the Securities Exchange Act. AndrewAct of 1934, as amended (the “Exchange Act”). Mr. Hobson has been designated as an “audit committee financial expert,”expert”, as such term is defined in Item 407(d)(5) of Regulation S-K. The Audit Committee assists the Board in its oversight of the quality and integrity of the accounting, auditing and financial reporting practices of Clear Channel Outdoor. The Audit Committee’s primary responsibilities, which are discussed in detail within its charter, include the following:
be responsible for the appointment, compensation, retention and oversight of the work of the independent registered public accounting firm and any other registered public accounting firm engaged for the purpose of preparing an audit report or to perform other audit, review or attest services and all fees and other terms of their engagement;
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review and discuss reports regarding the independent registered public accounting firm’s independence;
review with the independent registered public accounting firm the annual audit scope and plan;
review with management, the director of internal audit and the independent registered public accounting firm the budget and staffing of the internal audit department;
review and discuss with management and the independent registered public accounting firm the annual and quarterly financial statements and the specific disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” prior to the filing of the Annual Report on Form 10-K and Quarterly Reports on Form 10-Q;
• | review and discuss with management and the independent registered public accounting firm the annual and quarterly financial statements and the specific disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” prior to the filing of the Annual Report on Form 10-K and Quarterly Reports on Form 10-Q; |
review with the independent registered public accounting firm the critical accounting policies and practices used;
review with management, the independent registered public accounting firm and the director of internal audit Clear Channel Outdoor’s internal accounting controls and any significant findings and recommendations;
discuss guidelines and policies with respect to risk assessment and risk management;
oversee Clear Channel Outdoor’s policies with respect to related party transactions;
prepare the Audit Committee report for inclusion in Clear Channel Outdoor’s annual proxy statement;
review information technology procedures and controls, including as they relate to data privacy and cyber-security; and
review with management and the General CounselChief Legal Officer the status of legal and regulatory matters that may have a material impact on Clear Channel Outdoor’s financial statements and compliance policies.
The full text of the Audit Committee’s charter can be found on our website at www.investor.clearchannel.com.www.investor.clearchannel.com.
The Compensation Committee
The Compensation Committee consists of Thomas C. King, Lisa Hammitt and Joe Marchese, each of whom is independent under the rules of the NYSE and further qualifies as a non-employee director for purposes of Rule 16b-3 under the Exchange Act. The members of the Compensation Committee are not current or former employees of Clear Channel Outdoor, are not eligible to participate in any of Clear Channel Outdoor’s executive compensation programs, do not receive compensation that would impair their ability to make independent judgments about executive compensation and are not “affiliates” of the Company, as defined under Rule 10c-110C-1 under the Exchange Act. The Compensation Committee administers Clear Channel Outdoor’s incentive-compensation plans and equity-based plans, determines compensation arrangements for all executive officers and makes recommendations to the Board concerning compensation for our directors. The Compensation Discussion and Analysis section of this proxy statementProxy Statement provides additional details regarding the basis on which the Compensation Committee determines executive compensation.
The Compensation Committee’s primary purposes,responsibilities, which are discussed in detail within its charter, are to:include the following:
assist the Board in ensuring that a proper system of long-term and short-term compensation is in place to provide performance-oriented incentives to management and that compensation plans are appropriate and competitive and properly reflect the objectives and performance of management and Clear Channel Outdoor;
review and approve corporate goals and objectives relevant to the compensation of Clear Channel Outdoor’s executive officers, evaluate the performance of the executive officers in light of those goals and objectives and, either as a committee or together with the other independent directors (as directed by the Board), determine and approve the compensation level of the executive officers based on this evaluation;
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review and adopt, and/or make recommendations to the Board with respect to, incentive-compensation plans for executive officers and equity-based plans;
Notice and Proxy Statement 2023 9 |
review and discuss with management the Compensation Discussion and Analysis to be included in Clear Channel Outdoor’s annual proxy statement and determine whether to recommend to the Board the inclusion of the Compensation Discussion and Analysis in the proxy statement;annual Proxy Statement;
prepare the Compensation Committee report for inclusion in Clear Channel Outdoor’s annual proxy statement;
review and make recommendations about the Company’s strategies, policies and procedures with respect to human capital management; and
recommend to the Board the appropriate compensation for the non-employee members of the Board.
• | recommend to the Board the appropriate compensation for the non-employee members of the Board. |
The Compensation Committee has the ability, under its charter, to select and retain, in its sole discretion, at the expense of Clear Channel Outdoor, independent legal and financial counsel and other consultants necessary to assist the Compensation Committee as the Compensation Committee may deem appropriate, in its sole discretion.Committee. The Compensation Committee also has the authority to select and retain any compensation consultant to be used to survey the compensation practices in Clear Channel Outdoor’s industry and to provide advice so that Clear Channel Outdoor can maintain its competitive ability to recruit and retain highly qualified personnel. The Compensation Committee has the sole authority to approve related fees and retention terms for any of its counsel and consultants.
During 2020,2022, the Compensation Committee engaged an independent compensation consultant, Willis Towers Watson (“Willis”WTW”), to provide executive compensation benchmarking data and incentive and retention compensation plan design advice. The Compensation Committee requested and evaluated responses from WillisWTW addressing its independence in accordance with applicable NYSE rules and concluded that Willis’WTW’s work does not raise any conflict of interest or independence concerns.
The full text of the Compensation Committee’s charter can be found on our website at www.investor.clearchannel.com.www.investor.clearchannel.com.
The Nominating and Corporate Governance Committee
The Nominating and Corporate Governance Committee consists of Mary Teresa Rainey, Joe Marchese, Lisa Hammitt and John Dionne, each of whom is independent under the rules of the NYSE. The Nominating and Corporate Governance Committee’s primary responsibilities, which are discussed in detail within its charter, include the following:
identify individuals qualified to become members of the Board, consistent with criteria approved by the Board;
recommend director nominees to the Board for the next annual meeting of stockholders;
oversee the organization of the Board to discharge the Board’s duties and responsibilities properly and efficiently;
develop and recommend corporate governance guidelines;
oversee the evaluation of the Board and management; and
oversee, review with management and report to the Board on the Company’s environmental, social and governance (“ESG”) strategy,ESG policies and practices in order to manage risk, lay a foundation for sustainable growth and effectively communicate ESG initiatives to stakeholders.
The full text of the Nominating and Corporate Governance Committee’s charter can be found on our website at www.investor.clearchannel.com.www.investor.clearchannel.com.
DIRECTOR NOMINATING PROCEDURES
The Nominating and Corporate Governance Committee is responsible for identifying individuals qualified to become Board members, developing qualification standards and other criteria for selecting Board member nominees and reviewing background information for candidates for the Board, including those recommended by stockholders. The Nominating and Corporate Governance Committee believes that all directorsBoard members must, at a minimum, meet the criteria set forth in the Corporate Governance Guidelines, which specify, among other things, that the Board of the Company seeks members from
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diverse professional backgrounds who combine a broad spectrum of experience and expertise with a reputation for integrity. While we do not have a formal policy on diversity, when considering the selection of director nominees, the Nominating and Corporate Governance Committee considers individuals with diverse viewpoints, accomplishments, cultural backgrounds, professional expertise and diversity in gender, ethnicity, race, skills and geographic representation that, when considered as a group, provide a sufficient mix of perspectives to allow the Board to best fulfill its responsibilities to and, advocate for the long-term interests of, our shareholders. Furthermore, our Board is committed to include qualified women and individuals from underrepresented minority groups in any pool for selection of new candidates for the Board in case the size of the Board were increased or as a result of a vacancy. The Board strives to nominate directors with a variety of complementary skills sosuch that, as a group, the Board will possess the appropriate mix of experience, skills and expertise to oversee the Company’s businesses. Directors should:must: (i) have experience in positions with a high degree of responsibility; (ii) be leaders in the organizations with whichwhom they are affiliated; (iii) have the time, energy, interest and willingness to serve as a member of the Board; and (iv) be selected based upon contributions they can make to the Board and management. Our directorsMembers of our Board play a critical role in guiding our strategic direction and overseeing our management. The Nominating and Corporate Governance Committee evaluates each individual in the context of the Board as a whole, with the objective of recommending a group that can best perpetuate the success of our business and represent stockholder interests through the exercise of sound judgment and using its
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diversity of experience. The Nominating and Corporate Governance Committee evaluates each incumbent director to determine whether heshe or shehe should be nominated to stand for re-election,reelection based on the types of criteria outlined above as well as the director’s contributions to the Board during their current term.
The Nominating and Corporate Governance Committee will consider as potential nominees individuals properly recommended by stockholders. Recommendations concerning individuals proposed for consideration should be addressed to the Board, c/o Corporate Secretary, Clear Channel Outdoor Holdings, Inc., 4830 North Loop 1604W, Suite 111, San Antonio, Texas 78249. Each recommendation should include a personal biography of the suggested nominee, an indication of the background or experience that qualifies the person for consideration and a statement that the person has agreed to serve if nominated and elected. The Board evaluates candidates recommended by stockholders in the same manner in which it evaluates other nominees. Stockholders who themselves wish to effectively nominate a person for election to the Board, as contrasted with recommending a potential nominee to the Board for its consideration, are required to comply with the advance notice and other requirements set forth in our bylaws.By-laws.
The Board exercises its discretion in combining or separating the position of chairChair of the Board and CEOChief Executive Officer as it deems appropriate in light of prevailing circumstances. Mr. EccleshareWells currently serves as our CEOChief Executive Officer, and Mr. Moreland currently serves as our independent Chair of the Board. The CEOChief Executive Officer is responsible for the strategic direction, day-to-day leadership and performance of the Company, while the Chair of the Board provides overall leadership to our Board. TheThis leadership structure allows the CEOChief Executive Officer to focus on his operational responsibilities, while keeping a measure of independence between the oversight function of our Board and those operating decisions. Our Board believes that this leadership structure provideshas historically provided an appropriate allocation of roles and responsibilities and ishas been in the best interests of stockholders and believes that it continues to be appropriate and in the best interests of stockholders at this time.time given Mr. Wells’ recent transition to the Chief Executive Officer role, effective as of January 1, 2022.
Notice and Proxy Statement 2023 11 |
W. Benjamin Moreland | Mr. Moreland has been our independent Chair since May 2019. The Board views the independent Chair as a liaison between the Board and the Company’s Chief Executive Officer and other members of management and believes the powers and authority of the Chair strengthen the Board’s role in risk oversight. Mr. Moreland exercises effective leadership and sets the tone at the top. He leverages, from multiple leadership positions on boards of large public companies, his breadth of experience in oversight areas, including in financial and transactional matters, as well as his strategic insight to strengthen independent oversight of management. Our independent Chair has power and authority to do the following: • preside at all meetings of non-management directors when they meet in executive session without management participation; • set agendas, priorities and procedures for meetings of non-management directors meeting in executive session without management participation; • add agenda items to the established agenda for meetings of the Board and its committees; • request access to the Company’s management, employees and its independent advisers for purposes of discharging his duties and responsibilities as a director; and • retain independent outside financial, legal or other advisors at any time, at the expense of the Company, on behalf of the Board or any committee or subcommittee of the Board. |
In addition, at any time when the Chair might not be an independent director, the Board has created the office of the Presiding Director to serve as the lead non-management director of the Board. If required, the Presiding Director would be an “independent” director, as that term is defined from time to time by the listing standards of the NYSE and as determined by the Board in accordance with the Governance Guidelines. If the Chair of the Board is an independent director, then the Chair of the Board assumes the responsibilities of the Presiding Director that are set forth above. Throughout the year, we engage with our stockholders to discuss and receive feedback on various matters, including our governance structure.
SELF-EVALUATION
Our Board conducts an annual self-evaluation process to determine whether the Board, its committees and the directors are functioning effectively. This includes survey materials as well as individual, private conversations between directors and the Chair of the Board, as needed, and a report to, and discussion of survey results with, the Nominating and Corporate Governance Committee and the full Board. The survey materials solicit feedback on organizational issues,matters, business strategy, and financial matters, board structure and meeting administration. The directors use the survey materials, discussions with the Chair of the Board, as needed, and discussions with the full Board to provide feedback, identify themes for the Board to consider, suggest specific action steps and review Board agendas. In addition, focus areas identified through the evaluation are incorporated into the Board’s agendaand, as applicable, its committees’ agendas for the following year to monitor progress. The annual Board performance evaluation is also a primary determinant for Board tenure. Annually, the Nominating and Corporate Governance Committee reviews progress against focus areas identified in the self-evaluation. Each committee also conducts its own annual self-evaluation to assess the functioning of the committee and the effectiveness of the committee members, including the committee chair.
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Our Board has overall responsibility for the oversight of our enterprise risk management process, which is guided by the COSO Enterprise Risk Management Framework three lines of defense model, including operational managementOperational Management as the First Line of Defense, Compliance and Information Security as the Second Line of Defense and Internal and External Audit as the Third Line of Defense. The Board sets the tone at the top as it relates to enterprise risk management and encourages management to promote a corporate culture that incorporates risk management into our corporate strategy and day-to-day operations.
Our risk management philosophy strives to:
timely identify the material risks that we face;
communicate necessary information with respect to material risks to senior management and, as appropriate, to the Board or relevant Board committee;
implement appropriate and responsive risk management strategies consistent with our risk profile; and
integrate risk management into our decision-making.
Our management conducts a formal risk assessment of the Company’s business, including probability and potential economic and reputational impact assessments, and develops mitigation actions and monitoring plans.
The Board has designated the Audit Committee to broadly oversee enterprise risk management in accordance with our Audit Committee Charter.its charter. Under the oversight of the Audit Committee, and with the support of the Company’s compliance function and the Company’s internal and external audit functions, we operate an enterprise-wide risk management governance framework that sets standards and provides guidance for the identification, assessment, monitoring and control of the most significant risks facing the Company and that have the potential to affect stockholder value, our customers and colleagues, the communities in which we operate and the safety and soundness of the Company. The Audit Committee then reports to the Board quarterly regarding briefings provided by management and advisors, as well as the Audit Committee’s own analysis and conclusions regarding the adequacy of our risk management processes.
Notice and Proxy Statement 2023 13
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The Board also exercises its oversight of our enterprise risk management process with support from the Compensation Committee and the Nominating and Corporate Governance Committee, each of which has oversight responsibilities for risks that may fall within their areaareas of responsibility and expertise. For example, the Compensation Committee reviews human capital related risks, and the Nominating and Corporate Governance Committee regularly reviews ESG risks. The Board receives independent reports from each committee at its quarterly meetings.
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SUCCESSION PLANNING
At least annually, the Compensation Committee reviews the Company’s talent management and succession plan, including with respect to the Chief Executive Officer and other executive positions. This includes the review and evaluation of development plans for potential successors to the Chief Executive Officer role and other keyexecutive positions. As part of the Board’s ongoing succession planning processes, the Board, after recommendation from the Compensation Committee, identified Mr. Wells, our current Chief Executive Officer, as successor to Mr. Eccleshare. On July 27, 2021, the Board unanimously appointed Mr. Wells as our successor Chief Executive Officer and a director, effective January 1, 2022. Among the qualifications, skills and attributes that the Compensation Committee and Board considered to appoint Mr. Wells as our Chief Executive Officer were his proven and successful leadership of the Company’s Americas business and his deep knowledge of our business, strategic vision, leadership and moral integrity. Following Mr. Wells appointment and first year as the Company’s Chief Executive Officer, the Compensation Committee has continued its routine talent management and succession planning with Mr. Wells’ input.
Developing talent at all levels of the Company is a priority for the Company.us. We are focused on providing the Board with additional opportunities to interact with senior management, including providing informal feedback sessions where directors meet with groups of senior management below the executive level, which gives management unique access to the Board and also facilitates a deeper understanding of the organization byamong the Board. The Company also offers various talent development programs throughout the organization focused on building leadership and management skills, career development and other areas.
Our corporate governance practices are established and monitored by the Board. The Board, with assistance from itsthe Nominating and Corporate Governance Committee, periodically assesses our governance practices in light of legal requirements and governance best practices.
Our primary governing documents include:
Governance Guidelines
Board Committee Charters
○ | Audit Committee Charter |
○ | Compensation Committee Charter |
○ | Nominating and Corporate Governance Committee Charter |
Code of Business Conduct and Ethics
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These documents are available on our website at www.investor.clearchannel.com.www.investor.clearchannel.com. We encourage our stockholders to read these documents, as we believe they illustrate our commitment to good governance practices. Certain key provisions of these documents are summarized below.
Notice and Proxy Statement 2023 15 |
GOVERNANCE GUIDELINES
We operate under Governance Guidelines that set forth our corporate governance principles and practices on a variety of topics, including director qualifications, the responsibilities of the Board, independence requirements and the composition and functioning of the Board. Our Governance Guidelines are designed to maximize long-term stockholder value, align the interests of the Board and management with those of our stockholders and promote high ethical conduct among our directors. The Governance Guidelines include, but are not limited to, the following key practices to assist the Board in carrying out its responsibility forresponsibilities in connection with the business and affairs of Clear Channel Outdoor:
1. | Director Responsibilities
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The basic responsibility of a director is to exercise his or her business judgment and act in what | ||
2. | Self-Evaluation Process
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The Board and each standing committee of the Board will conduct an annual self-evaluation to determine whether it and its committees are functioning effectively. The Nominating and Corporate Governance Committee is responsible for overseeing the self-evaluation process and for proposing any modification or alterations in Board or committee practices or procedures. | ||
3. | Executive Sessions of Non-Management Directors
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The non-management directors and/or the independent directors meet periodically in executive session without management participation. | ||
4. | Board Access to Senior Management
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Directors have complete access to Clear Channel Outdoor’s management, employees and its independent advisors for purposes of discharging their duties and responsibilities as directors and can initiate contact or meetings through the | ||
5. | Board Access to Independent Advisors
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The Board and each Board committee have the power to retain independent legal, financial or other advisors as they may deem necessary, at our expense. | ||
6. | Board Tenure
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The Board believes that term limits on director service and a predetermined retirement age impose arbitrary restrictions on Board membership. Instead, the Board believes directors who, over a period of time, develop an insight into Clear Channel Outdoor and its operations provide an increasing contribution to Clear Channel Outdoor as a whole. The annual board performance evaluation is a primary determinant for Board tenure. | ||
7. | Directors Who Change Their Current Job Responsibilities
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A director who changes the nature of the job | ||
8. | Service on Multiple Boards
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To enable the Board to assess a director’s effectiveness and any potential conflicts of interest, any director who serves on more than three other public company boards must advise the Chair in advance of accepting an invitation to serve as a member of another public company board. | ||
9. | Management Development and Succession Planning
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The Board or a committee of the Board will periodically consider management development and succession planning, including short-term succession planning for certain of Clear Channel Outdoor’s most senior management positions. |
16 Notice and Proxy Statement
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Each standing committee of the Board operates under a written charter that has been adopted by the Board. We have three standing committees: the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee. TheEach committee charters setcharter sets forth the purpose, responsibilities of the respective committee and discussdiscusses matters such as committee membership requirements, number of meetings and the setting of meeting agendas. The charters are assessed at least every other year, or more frequently as the applicable committee may determine, and are updated as needed. More information on the Board’s standing committees, their respective roles and responsibilities and their charters can be found under “The Board of Directors and Corporate Governance—Committees of the Board.”Board” above.
CODE OF BUSINESS CONDUCT AND ETHICS
Our Code of Business Conduct and Ethics (the “Code of Conduct”“Code”) applies to all of our officers, directors, and employees including(including our principal executive officer, principal financial officer and principal accounting officer.officer), interns, contractors and agents throughout our corporate structure. Our Code of Conduct constitutes a “code of ethics”, as defined by Item 406(b) of Regulation S-K. Our Code of Conduct is publicly available on our website at www.investor.clearchannel.com.www.investor.clearchannel.com. We intend to satisfy the disclosure requirements of Item 5.05 of Form 8-K regarding any amendment to, or waiver from, a provision of the Code of Conduct that applies to our principal executive officer, principal financial officer or principal accounting officer and relates to any element of the definition of code of ethics set forth in Item 406(b) of Regulation S-K by posting such information on our website www.investor.clearchannel.com.at www.investor.clearchannel.com.
STOCKHOLDER AND INTERESTED PARTY COMMUNICATION WITH THE BOARD
Stockholders and other interested parties may contact an individual director, the Chair of the Board, the Board as a group or a specified Board committee or group, including the non-management directors as a group, by sending regular mail to the following address:
Board of Directors
c/o Corporate Secretary
Clear Channel Outdoor Holdings, Inc.
4830 North Loop 1604W, Suite 111
San Antonio, Texas 78249
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Security Ownership of Certain Beneficial Owners and Management
Except as otherwise stated, the table below sets forth information concerning the beneficial ownership of Clear Channel Outdoor’s common stock as of March 9, 20217, 2023 for: (1) each director currently serving on our Board, and eachall of thewhom are nominees for director; (2) each of our named executive officers; (3) our directors and executive officers as a group; and (4) each person known to Clear Channel Outdoor to beneficially own more than 5% of any class of Clear Channel Outdoor’s outstanding shares of common stock. At the close of business on March 9, 2021,7, 2023, there were 467,859,064477,438,803 shares of Clear Channel Outdoor’s common stock outstanding. Except as otherwise noted, each stockholder has sole voting and investment power with respect to the shares beneficially owned.
Each share of Clear Channel Outdoor common stock is entitled to one vote on matters submitted to a vote of the stockholders. Each share of our common stock is entitled to share equally on a per shareper-share basis in any dividends and distributions by us.
Name and Address of Beneficial Owner(a) | Number of Shares of Common Stock | Percent of Common Stock(b) | ||||||
Holders of More than 5%: | ||||||||
PIMCO(c) | 104,258,819 | 22.4 | % | |||||
Ares Management(d) | 36,999,772 | 7.9 | % | |||||
The Vanguard Group(e) | 30,977,587 | 6.6 | % | |||||
Mason Capital Management LLC(f) | 30,364,927 | 6.5 | % | |||||
Named Executive Officers, Executive Officers and Directors: |
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C. William Eccleshare(g) | 2,418,253 | * | ||||||
Brian D. Coleman(h) | 425,342 | * | ||||||
Scott R. Wells(i) | 1,295,564 | * | ||||||
Lynn A. Feldman(j) | 357,344 | * | ||||||
Jason A. Dilger(k) | 136,532 | * | ||||||
John Dionne(l) | 163,163 | * | ||||||
Lisa Hammitt(m) | 115,369 | * | ||||||
Andrew Hobson(n) | 315,369 | * | ||||||
Thomas King(o) | 173,992 | * | ||||||
Joe Marchese(p) | 186,963 | * | ||||||
W. Benjamin Moreland(q) | 1,012,117 | * | ||||||
Mary Teresa Rainey(r) | 115,369 | * | ||||||
Jinhy Yoon | — | — | ||||||
All directors and executive officers as a group (13 individuals)(s) | 6,715,377 | * |
Name and Address of Beneficial Owner(a) | Number of Shares of Common Stock | Percent of Common Stock(b) | ||||||
Holders of More than 5%: | ||||||||
PIMCO(c) | 104,872,541 | 22.0 | % | |||||
Ares Management(d) | 55,829,046 | 11.7 | % | |||||
The Vanguard Group(e) | 43,314,179 | 9.1 | % | |||||
BlackRock, Inc.(f) | 29,320,720 | 6.1 | % | |||||
Named Executive Officers, Executive Officers and Directors: |
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Scott R. Wells(g) | 1,900,832 | * | ||||||
Brian D. Coleman(h) | 969,566 | * | ||||||
Lynn A. Feldman(i) | 674,551 | * | ||||||
Jason A. Dilger(j) | 243,391 | * | ||||||
John Dionne(k) | 283,552 | * | ||||||
Lisa Hammitt(l) | 167,551 | * | ||||||
Andrew Hobson(m) | 435,758 | * | ||||||
Thomas King(n) | 372,143 | * | ||||||
Joe Marchese(o) | 383,068 | * | ||||||
W. Benjamin Moreland(p) | 1,234,825 | * | ||||||
Mary Teresa Rainey(q) | 235,758 | * | ||||||
Jinhy Yoon | — | — | ||||||
All directors and executive officers as a group (13 individuals)(r) | 7,307,598 | 1.53 | % |
* | Means less than 1%. |
(a) | Unless otherwise indicated, the address for all beneficial owners is c/o Clear Channel Outdoor Holdings, Inc., 4830 North Loop 1604W, Suite 111, San Antonio, Texas 78249. |
(b) | Percentage of ownership calculated in accordance with Rule 13d-3(d)(1) under the |
(c) | As reported on a Form 4 filed on June 2, 2022. According to the reporting person’s Schedule 13D/A filed on August 2, |
(d) | As reported on a Form 4 filed on February 2, 2023. According to the reporting person’s Schedule 13D/A filed on January |
18 Notice and Proxy Statement 2023 |
LLC, Ares Management Holdings L.P., Ares Holdco LLC, |
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Holdco LLC. The business address of each reporting person is c/o Ares Management LLC, 2000 Avenue of the Stars, 12th Floor, Los Angeles, California 90067. |
(e) | As reported on a Schedule 13G/A filed with respect to Clear Channel Outdoor’s common stock on February |
(f) | As reported on a Schedule 13G/A filed with respect to Clear Channel Outdoor’s common stock on February 9, |
(g) | Represents |
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Represents |
(i) | Represents 416,119 shares of common stock, 20,921 shares of restricted stock, vested stock options representing 11,043 shares of common stock and |
Represents |
Represents |
Represents |
Represents |
Represents |
Represents |
Represents |
Represents |
As of March |
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PROPOSAL 1: ELECTION OF DIRECTORS
The Board has nominated the persons listed below as nominees below for election as directors at the annual meeting of stockholders. Mr. Eccleshare and Mses. Hammitt and RaineyAnnual Meeting. All nominees are currently directors and are standing for re-election. The Pursuant to our Certificate of Incorporation, each director will be elected for a one-year term annually. Accordingly, the directors elected at the annual meetingAnnual Meeting will serve a two-yearone-year term until the annual meeting of stockholders in 2024 or until hisher or herhis successor shall have been elected and qualified, subject to earlier death, resignation or removal. The directors are to be elected by a plurality of the votes cast at the annual meeting.Annual Meeting. Each nominee has indicated a willingness to serve as directorsdirector if elected. Should any nominee become unavailable for election, discretionary authority is conferred on the proxies to vote for a substitute. Management has no reason to believe that any nominee will be unable or unwilling to serve if elected.
Our directors, including our director nominees, are from diverse professional backgrounds and possess the relevant combination of experience, skills and qualifications that contribute to a well-functioning board that is equipped to oversee the Company’s business and represent stockholder interests through sound judgment and utilizing the group’s varied experience. The diversity of characteristics, and expertise, skill and experience that the Nominating and Corporate Governance Committee and the Board seek in the composition of the Board, as well as the individual experiences, skills and characteristics of our Board members, are highlighted in the following charts and director qualifications matrix.
DIRECTOR EXPERIENCE AND CORE COMPENTENCIES
20 Notice and Proxy Statement 2023 | ||||||||||||||||||||||
Notice and Proxy Statement
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The following information, which is as of March 17, 2021,7, 2023, is furnished with respect to each of the nominees for election at our annual meeting and each of the other continuing members of our Board. Annual Meeting.
The Board recommends that you vote “FOR” the Class IIall director nominees named below.nominees. Properly submitted proxies will be so voted unless stockholders specify otherwise.
NOMINEES FOR DIRECTORS FOR TERMS EXPIRING IN 2023 (CLASS II)
Age:
Board Committees: • • Nominating and |
Mr.
• Previously was • Significant experience as a director Education • B.S. Magna Cum Laude in • M.B.A., academic honors, Harvard Business School | |
22 Notice and Proxy Statement 2023 |
Age:
Board Committees: • Compensation • Nominating and |
Lisa Hammitt
Ms. Hammitt has served as Chairwoman of the board of directors of Intelsat, S.A., a multinational satellite services provider headquartered in Luxembourg, since March 2022. Previously, Ms. Hammitt served as the Executive Vice President, Artificial Intelligence and Chief Technology Officer at Davidson Technologies
• Track record of developing $100 million+ businesses. • Broad executive experience in various roles at multinational companies. Education • B.A. in French and B.A. in Economics, University of California, Berkely • Graduate Coursework in Artificial Intelligence, Stanford University • Executive Education, Harvard Business School |
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Age:
Board Committees: • Audit
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• Deep experience in • Strong experience and service as a public company board member, including as chairman. • 30-year career building and leading teams of finance executives and raising billions in debt and equity financing. Education • B.S.E in Finance and B.S.E in Accounting, magna cum laude, University of Pennsylvania, The Wharton School | |
DIRECTORS WHOSE TERMS WILL EXPIRE IN 2022 (CLASS III)
24 Notice and Proxy Statement 2023
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Age:
Board Committees: • Compensation
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Thomas C. King
Mr. King has served as an Operating Partner at Atlas Merchant Capital, a global private equity fund, since November 2018. From December 2009 through March 2016, Mr. King held several senior roles at Barclays PLC (NYSE: BCS), an international investment banking firm, including serving as Chief Executive Officer of Investment Banking and Chairman of the Investment Banking Executive Committee. Mr. King was also a member of the Barclays Group Executive Committee which oversees all of the Barclays
• Maintains strong knowledge of the financial markets. • Extensive experience and service as a public company board member. Education • B.A. in Economics, Bowdoin College • M.B.A in Finance, University of Pennsylvania, The Wharton School |
Notice and Proxy Statement
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Director Age: 41 Board Committees: • Compensation • Nominating and | Joe Marchese Mr. Marchese served as the Chief Executive Officer of Attention Capital, a media and technology holding company, since August 2019. Mr. Marchese is also the Co-Founder and Executive Chairman of Human Ventures, a leading start-up studio and venture fund, since February 2015 and has served as Partner/Co-Founder of Casa Komos Brands Group, a portfolio of elevated hospitality brands, since 2019. From 2015 to 2019, he served as President of Advertising Revenue for Fox Networks Group, a television broadcasting company, a role in which he oversaw multi-billion dollar advertising sales, research and innovation for FOX Broadcast, FOX Sports, FS1, FX, FXX and National Geographic. Previously, Mr. Marchese co-founded and served as Chief Executive Officer of true[X], an advertising technology company, from May 2013 until its acquisition by 21st Century Fox in February 2015. Prior to co-founding true[X], Mr. Marchese held various roles as a media executive, management consultant and multiple time entrepreneur. He serves as a board member of Cox Media Group, a large media, news and entertainment company, since February 2020, Groundswell, a philanthropy technology company, since June 2021, and Adelaide, a leading technology company specializing in real-time attention measurement, since June 2022. Mr. Marchese previously served as a member of the board of trustees of the Paley Center for Media, and currently serves as a board member for non-profits, Tribeca Film Institute and Team Rubicon. In 2016, Mr. Marchese was inducted into the American Advertising Federation’s Advertising Hall of Achievement. Qualifications and Expertise Provided to Our Board • Extensive experience and deep knowledge in the advertising industry. • Extensive experience in investment strategy. • Strong executive and leadership experience. • Significant experience as a board member. Education • B.A. in Economics and Finance, Bentley University |
26 Notice and Proxy Statement 2023 |
Age:
Board Committees: • None
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W. Benjamin Moreland
Mr. Moreland is a private investor and retired
• Effective leader, setting tone at the top. • Extensive breadth of experience in oversight areas. • Extensive experience and service as a public company board member. His experiences add deep knowledge and leadership depth to the Board. Education • B.B.A., The University of Texas at Austin • M.B.A, The University of Houston | |
Notice and Proxy Statement 2023 27 |
Age: Board Committees: • Audit • Nominating and | Mary Teresa Rainey Ms. Rainey OBE was founder of Rainey, Kelly Campbell Roalfe/Y&R, a major U.K. advertising agency, which is now part of the WPP group, and served as Chief Executive Officer of Rainey, Kelly Campbell Roalfe/Y&R from 1993 to 2003 and Chair from 2003 to 2006. She was also an early investor in, and Executive Chair of, Th_nk Ltd, a digital strategy agency, from 2006 until 2016. Prior to that, she spent 8 years in the U.S. with Chiat/Day Advertising as SVP Director of Planning. Ms. Rainey has served as a non-executive board director and member of the audit, compensation and governance committees of Hays plc, an international recruitment company publicly traded in the U.K., since 2015. She is also an investor in Charlotte Street Partners, a U.K.-based public affairs consulting company, and has served as a board member since 2017 and has served as Chair since 2023. She also served as a board member and member of the compensation committee of Pinewood Studios, a U.K. publicly-traded international film studio, from 2015 to 2016. Ms. Rainey also served as Vice Chair of Channel 4 Television, a major U.K. broadcaster, from 2018 to 2021, and previously served on both the audit and ethics committees from 2012 to 2018. Qualifications and Expertise Provided to Our Board • Deep executive and entrepreneurial experiences. • Widespread reputation as an internationally respected advertising leader. • Significant international business experience that is valuable to the Board’s strategic and operational understanding of global business opportunities. • Extensive experience in the advertising industry. • Board level experience in various listed companies. • Obtained certification related to role of public company boards in ESG. Education • M.A. Hons Graduate Degree, Glasgow University |
28 Notice and Proxy Statement 2023 |
Chief Executive Officer Age: 54
Board Committees: • None
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Qualifications and Expertise Provided to Our Board • Extensive knowledge of the Company and important perspectives on the complex financial and operational issues facing the Company. • Strategic vision and extensive experience in technology and advertising. • Experience highlighting the innovation and embracing technology throughout his career. • Extensive business and leadership experience. Education • B.S./B.A., Virginia Polytechnic Institute and State University • M.B.A, University of Pennsylvania, The Wharton School | |
Director Age: 50 Board Committees: • None | Jinhy Yoon
Ms. Yoon
• Broad accounting and legal | |
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DIRECTORS WHOSE TERMS WILL EXPIRE IN 2023 (CLASS I)
•
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Notice and Proxy Statement
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A Message from our Compensation Committee
The Compensation Committee of the Board of Directors oversees Clear Channel Outdoor Holdings, Inc.’s executive compensation philosophy and reviews and approves compensation for our named executive officers (NEOs). While Clear Channel Outdoor management and our independent compensation consultant provide input, it is the sole responsibility of the Compensation Committee to approve our executive compensation philosophy, plans, policies and programs.
In addition, 2022 was our first year under new leadership. Effective January 1, 2022, the Board appointed Mr. Scott R. Wells to serve as
The compensation determinations for our NEOs reflect our 2022 performance as well as the many contributions of our leaders to driving the year’s successes. As a result of strong business and individual performance in
We also continued to evaluate |
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More details are provided on the following pages, and we look forward to getting stockholder feedback in the near future. Thank you for your continued engagement.
Thomas C. King
Compensation Committee
Thomas C. King (Chair) Lisa Hammitt Joe Marchese
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Compensation Discussion and Analysis
Clear Channel Outdoor Holdings, Inc. (“Clear Channel Outdoor,” the “Company,” “we” or “us”), a Delaware corporation, is one of the world’s largest outdoor advertising companies, providing clients with advertising opportunities through billboards, street furniture displays, transit displays and other out-of-home advertising displays. Through our extensive display inventory and technology-based enhancements, we have the ability to deliver innovative, effective marketing campaigns for advertising partners globally.
We are focused on building the leadership position of our diverse global assets and maximizing our financial performance while serving our local communities. We intend to continue to execute upon our long-standing outdoor advertising strategies, while closely managing expenses and focusing on achieving operating efficiencies throughout our businesses.
Our Named Executive Officers (NEOs)OUR NEOS
For 2020,2022, our named executive officers (“NEOs”)NEOs were:
Named Executive Officer | Title | |
| President and Chief Executive Officer of Clear Channel Outdoor | |
Brian D. Coleman | Executive Vice President and Chief Financial Officer of Clear Channel Outdoor | |
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Lynn A. Feldman | Executive Vice President, | |
Jason A. Dilger | Senior Vice President and Chief Accounting Officer of Clear Channel Outdoor |
Impact of COVID-19
2020 was a year largely defined by the COVID-19 pandemic, which had significant impacts on our employees, customers and the broader global economy. COVID-19 resulted in volatile economic conditions, business disruptions across the globe and reductions in consumer spending. COVID-19’s extensive impact on the overall economy and on the global advertising market in particular had a significant adverse impact on our business in 2020. Starting in March 2020, we observed lock-downs limiting the behavior and movement of consumers and target audiences, which caused a significant decrease in out-of-home audience metrics indicating a reduction in consumer advertising display engagement; a sharp decline in customer bookings as customers deferred advertising buying decisions and reduced marketing spend; an unprecedented level of requests to defer, revise or cancel sales contracts as customers sought to conserve cash; and customers forced to close their businesses temporarily or permanently.
In response to COVID-19, we implemented significant changes that we determined were in the best interest of our employees and the communities in which we operate and which comply with government regulations. This included transitioning the vast majority of employees to work-from-home for a large portion of 2020, while implementing additional safety measures for employees continuing critical on-site work. In recent months, we have started to execute on our phased Return-to-Office plan on an office-by-office basis, ensuring compliance with applicable regulations as well as guidance issued by the CDC.
Since the onset of the pandemic, we took certain cost savings measures, including temporary reductions in salary. As a cost saving measure, for the period of April 1 – June 30, 2020, all Clear Channel Outdoor NEOs agreed to take a temporary reduction in base salary as further described below.
Our results of operations for 2020 were negatively impacted by COVID-19 largely due to customers deferring buying decisions and reducing marketing spend, and the Adjusted EBITDA thresholds under our Annual Incentive Plan were not met. As a result, no portion of the seventy percent (70%) of the annual incentive payout attributable to meeting the Adjusted EBITDA thresholds was paid for 2020. We did recognize the extraordinary effort and achievements of the NEOs throughout the year in maintaining and driving the business through the pandemic as part of considering each NEO’s performance against the portion of the annual incentive payout attributable to their individual goals. For 2020, we set individual performance goals for each NEO in early 2020 and supplemented those goals mid-year with additional individual goals intended to address the unique challenges presented to us by the pandemic. After consideration of each NEO’s performance against both their original and supplemental individual goals, we recognized over-achievement against their individual performance objectives with above-target payouts of the portion of their annual incentive payouts that are based on individual target opportunities. The 0% payout for the
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financial portion of the annual incentive payout combined with the above-target payout for the individual performance portion resulted in a total payout of less than 50% of total target annual incentive payment for all NEOs.
Our Executive Compensation PhilosophyOUR EXECUTIVE COMPENSATION PHILOSOPHY
To ensure our leaders are driven to deliver sustained business results and achieve our financial, operational and strategic objectives, our executive compensation program is designed to link business priorities with performance. We also believe it is important to strongly align our executives’ interests with those of our stockholders by emphasizing variable pay, with a specific focus on achieving Company results that drive shareholder returns.
Our executive compensation programs are based on a pay-for-performance philosophy and are designed to:
• Attract, motivate and retain talented executives who have the skills to drive our continued profitability, growth and success; • Align the interests of our executives with those of our stockholders; • Reward executives for sustained business results that drive stockholder value (pay-for-performance); and • Balance “best practices” in executive compensation design, local market practice and Company strategy.
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SUMMARY OF OUR 20202022 DECISIONS
The Compensation Committee makes decisions regarding our NEOs’ total compensation (base salary, annual bonus objectives, opportunities and payments and annual equity grants) in connection with our annual performance review process. The information below summarizes these decisions for 2020.2022. Based on market data provided by our independent compensation consultant, after making certain adjustments and compensation related decisions as described below, in aggregate, for 2022, our NEOsNEOs’ total compensation, ison average, was positioned approximately atslightly below the market median.
Factors that Guided Total Compensation Decisions | • Our executive compensation philosophy, taking into consideration our total shareholder return
• Degree of achievement of key strategic financial and operational goals for
• Recommendations of our CEO (other than with respect to his own compensation)
• Advice of an independent compensation consultant
• Market pay practices and levels
• Historical Clear Channel Outdoor compensation
•
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Key
See page | Base Salary Decisions On July 28, 2021, in connection with his transition from Executive Vice President, Chief Executive Officer Clear Channel Outdoor Americas to Chief Executive Officer (as more fully described below), we entered into an amended and restated employment agreement with Mr. Wells, pursuant to which his base salary was increased from $900,000 to $1,100,000 per annum, effective January 1, 2022.
Effective On October 31, 2022, in connection with entering into her amended and restated employment agreement, Ms. Feldman received a base salary increase
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2015 Executive Incentive Plan (Annual Incentive Plan) Decisions
Equity Grant Decisions
On On May 4, 2022, Messrs.
Beginning with the 2022 Annual Grants, we increased the intended ratio of performance-based versus time-based awards, resulting in a greater percentage of performance-based awards awarded to each of our NEOs. The In addition, beginning with the
greater than 100% if the Company’s TSR is less than zero over the performance period. |
32 Notice and Proxy Statement
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SUPPORTING OUR PAY-FOR-PERFORMANCE PHILOSOPHY
In support of our pay-for-performance philosophy and achievement of strong Company results, the majority of the total compensation opportunity that our
Consistent with Clear Channel Outdoor’s overall executive compensation philosophy, NEOs are rewarded for their strong leadership and individual performance, while providing them with equity incentives to ensure alignment of their interests with those of our stockholders. For Mr. | The majority of annualized total direct compensation for our NEOs — approximately
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CEO | Other NEOs (average) | |
1 | Long-term incentives are presented on an “annualized” basis, which better reflects our intended targeted |
ALIGNING PAY WITH PERFORMANCE
We emphasize variable pay rather than fixed pay, with target opportunities based on market practices and payments based on performance. The structure of our executive compensation program ensures that as an executive’s scope of responsibility increases, a greater portion of his or her compensation comes from performance-based pay. For 2020,2022, the at-risk components of our ongoing executive compensation program were designed as follows:
Element | Objective | Time Horizon | Metrics | Cash or Equity | ||||
Annual Incentive Plan (Short-term) | Reward achievement of annual Company, business unit and/or individual performance goals | 1 year | 70% based on achievement of Plan Adjusted EBITDA 30% based on other qualitative individual performance objectives | Cash | ||||
Restricted Stock Units (RSUs) (Long-term) | Promote executive retention Reinforce ownership in the Company | 3 years | Stock price appreciation and continued employment | Equity | ||||
Performance Stock Units (PSUs) (Long-term) | Reward long-term shareholder value creation Emphasizes long-term view | 3 years | Relative Total Shareholder Return (TSR) performance | Equity |
1 |
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Plan Adjusted EBITDA is defined as revenue less direct operating expenses and selling, general and administrative expenses, excluding restructuring and other costs, which are defined as costs associated with cost-saving initiatives such as severance, consulting and termination costs and other special costs; excluding bonus expenses. |
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COMPENSATION FACTORS AND GOVERNANCE
The Compensation Committee applies a number of governance features related to executive compensation, which are summarized below. We believe that these mechanisms help to assure the alignment of executive and stockholder interests.
What We Do | What We Don’t Do | |
ü Deliver a significant portion of executive compensation through performance-based at-risk pay
ü Maintain a peer group for benchmarking pay
ü Set challenging short- and long-term incentive objectives
ü Provide strong oversight to monitor our equity share usage and avoid excessive levels of dilution
ü Require stock ownership by executives, with minimum ownership levels defined by role
ü Have double-trigger change-in-control arrangements
ü Conduct an annual risk assessment to mitigate any compensation program-related risk having a material adverse effect on the Company
ü Offer market-competitive benefits for executives that are generally consistent with the benefits provided to the rest of our employees
ü Consult with an independent consultant on compensation levels and practices
ü Require reimbursement or forfeiture of any excess incentive compensation in the case of an accounting restatement resulting from fraud or misconduct
| × No across-the-board base salary increases
× No guaranteed bonus payments
× No hedging or pledging of equity
× No re-pricing of stock options
× No tax gross ups upon a change of control
× No excessive perquisites
× No supplemental executive retirement plans |
STOCKHOLDER INPUT ON EXECUTIVE COMPENSATION
We value the opinions of our stockholders, and we welcome input on our executive compensation program. In evaluating the design of our executive compensation and the compensation decisions for each of our NEOs, the Compensation Committee considers stockholder input, including investor feedback asking about thequestions relating to alignment between executive compensation and stockholder returns. Based onreturns and the fact thatselection of performance metrics in both our short-term and long-term incentive plans. Because over half of the annual equity grantgrants awarded to our NEOs is tied to relative TSR, we believe that we had addressed that feedback priorthere is alignment between executive compensation and stockholder returns. We reached out to its receipt.our stockholders regarding our compensation program in 2022 and generally received positive feedback.
We also consider the advisory “say-on-pay”“say-on-pay” vote in evaluating the design of our executive compensation and the compensation decisions for each of the NEOs. In May 2020,2022, Clear Channel Outdoor held a stockholder advisory vote on the compensation of Clear Channel Outdoor’s NEOs. More than 82%Approximately 81% of the votes cast approved the compensation of Clear Channel Outdoor’s NEOs. At our annual meeting of stockholders held on May 26, 2017, our stockholders recommended, and the Board determined, that the stockholderAn advisory “say-on-pay” vote on the compensation of our NEOs would occur every three years. Our Board has determined, however, to change the frequency of the “say-on-pay” votes to occur every year, in order to allow us to obtain stockholder input on our executive compensation program on a more regular basis. Accordingly, a say-on-pay advisory vote will also be held at the annual meetingour Annual Meeting this year, and we intend to hold a say-on-pay advisory vote at our annual meeting of stockholders in 2022 and 2023. We expect our next vote on the frequency of say-on-pay votes to occur at our annual meeting of stockholders in 2023.year.
34 Notice and Proxy Statement 2023 |
ROLE OF THE COMPENSATION COMMITTEE
The Compensation Committee of the Board of Directors administers the executive compensation program for all NEOs, as well as other executives within the Company. While Clear Channel Outdoor management provides input,
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it is the responsibility of the Compensation Committee to evaluate and approve our executive compensation philosophy, plans, policies and programs.
The following table outlines the process the Compensation Committee follows to ensure the total compensation for our NEOs is competitive, appropriately tied to performance and does not promote undue risk taking.
STEP 1: Input on Compensation | STEP 2:
| STEP 3: Compensation Committee Oversight | ||||||
These recommendations take into consideration the competitive market pay data provided by the Board’s independent consultant, as well as an evaluation of the NEO’s role, contributions and performance in achieving Company performance and long-term potential.
(See more below on the Board’s independent compensation consultant.)
| » | The Compensation Committee considers these recommendations together with the input of our independent compensation consultant. Subsequently, the Compensation Committee determines the NEOs’ compensation, ensuring that it is aligned with our compensation philosophy.
All aspects of the Chief Executive Officer’s compensation are determined solely by the Compensation Committee, with input from the independent compensation consultant.
| » | For the coming year, the Compensation Committee will review and approve:
• Objectives for each
• Variable pay target opportunities for annual incentive awards
• Performance metrics for the annual incentive award
Subsequently, each year in the spring, the Compensation Committee will review and approve long-term equity incentive grants and related performance metrics.
The Compensation Committee ensures that performance metrics are consistent with the financial, operational and strategic goals set by the Board, the performance goals are sufficiently ambitious and that amounts paid (when target performance levels are achieved) are consistent with our executive compensation philosophy.
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ROLE OF THE INDEPENDENT COMPENSATION CONSULTANT
Though the Compensation Committee has ultimate responsibility for compensation-related decisions, we retain WillisWTW as an independent consultant on executive compensation matters. WillisWTW provides market analyses and recommendations that inform the Compensation Committee’s decisions, shares updates on market trends and the regulatory environment as it relates to executive compensation, reviews various executive compensation proposals presented by management to the Compensation Committee and works with the Compensation Committee to validate and strengthen the pay-for-performance relationship and alignment with stockholders.
Pursuant to the rules of the SEC, the Compensation Committee has reviewed the SEC’s independence factors for compensation advisers and concluded that no conflict of interest exists that would prevent WillisWTW from independently representing the Compensation Committee.
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ROLE OF THE EXECUTIVE COMPENSATION PEER GROUP
To help ensure we provide our NEOs with fair and market-competitive compensation and to support retention of our key leaders, we annually review the compensation we offer our executives against executives within our peer group of companies. In |
Clear Channel Outdoor’s revenues
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Similar in size (primarily revenue - generally 0.5x - 2.5x that of Clear Channel, as well as market capitalization) and complexity to Clear Channel Outdoor
In the media or similar industry, including broadcasting, outdoor advertising, marketing/advertising and publishing
In competition with Clear Channel Outdoor for executive talent
In 2020, two peers (Tribune Media and New Media Investment) were removed due to merger/acquisition.
Our peer group will be regularly reviewed by the Compensation Committee with consideration given to our strategy and the advice of our independent compensation consultant. The Compensation Committee approved the following peer group for 2020:2022:
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AMC Networks, Inc.
Gannett Co., Inc.
Gray Television, Inc.
Lamar Advertising Company
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Meredith Corporation
Nexstar Media Group, Inc.
Nielsen Holdings plc
Outfront Media, Inc.
| Quad/Graphics, Inc.
Sinclair Broadcast Group, Inc.
Sirius XM Holdings, Inc.
TEGNA, Inc.
The New York Times Company
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RELATIONSHIP OF COMPENSATION POLICIES AND PROGRAMS TO RISK MANAGEMENT
In consultation with the Compensation Committee, management conducted an assessment of whether our compensation policies and practices encourage excessive or inappropriate risk taking by employees, including employees other than our NEOs. The assessment analyzed the risk characteristics of our business and the design and structure of our incentive plans and policies. | Although a significant portion of our executive compensation program is performance-based, the Compensation Committee has focused on aligning our compensation policies with the long-term interests of Clear Channel Outdoorand avoiding rewards or incentive structures that could create unnecessary risks.
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Management reported its findings to the Compensation Committee, which agreed with management’s assessment that our plans and policies do not encourage excessive or inappropriate risk taking and determined such policies or practices are not reasonably likely to have a material adverse effect on our business.
36 Notice and Proxy Statement
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ELEMENTS OF THE EXECUTIVE COMPENSATION PROGRAM
CCOH’s executive compensation consists of fixed pay and variable pay, including cash and non-cash components. The chart below summarizes the various elements of CCOH’s executive compensation and their purpose:
Element | Objective | Type of Compensation | Key Features | |||
Base Salary | Provide competitive fixed pay that is tied to the market and allows us to attract, retain and motivate executives within the media industry and broader market | Cash | • Reflects individual skills, experience, responsibilities and performance over time • Provides a stable and reliable source of income | |||
Short-Term Incentive — Annual Incentive Plan | Encourage focus on performance that achieves specific short-term goals | Cash | • Performance-based reward tied to achievement of short-term (annual) corporate, business unit • Pays only if threshold performance levels or above are met | |||
Long-Term Incentive — Restricted Stock Units (RSUs) | Promote executive retention over the long-term and align compensation over a multi-year period directly with the interests of stockholders | Equity | • Aligns executive and stockholder interests • Promotes retention and enhances executive stock ownership • Links value to stock price | |||
Long-Term Incentive — Performance Stock Units (PSUs) | Reward long-term stockholder value creation and emphasize a long-term view | Equity | • Performance-based rewards tied to achievement of long-term Total Shareholder Return (TSR) goals • Vests only if threshold performance levels or above are met • Aligns executive and stockholder interests • Links value to stock price and emphasizes relative outperformance of shareholder returns | |||
Other Benefits | Provide programs for employees to pursue physical and financial wellbeing through retirement and health and welfare benefits | Benefit | • 401(k) retirement plan available to all employees • Broad-based benefits available to all employees •
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Severance Agreements | Protects the Company and NEOs from certain termination events | Benefit | • Facilitates an orderly transition in the event of management changes • Helps ensure NEOs remain focused on creating sustainable performance in case of personal uncertainties or risk of job loss • Provides confidentiality, non-compete and non-solicit protections |
Notice and Proxy Statement 2023 37 |
ANALYSIS OF 20202022 COMPENSATION DECISIONS
All compensation decisions for 20202022 for Clear Channel Outdoor’s NEOs were made by the Compensation Committee. Prior to 2019, compensation decisions for many of our NEOs, including our former CEO, were determined
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by the Compensation Committee of our former parent company, iHeartMedia. None of our former CEO’s regular compensation was allocated to Clear Channel and was therefore not disclosed in our Proxy statements. The only amounts which were included in the Summary Compensation Table for our former CEO were amounts paid as accrued dividends on CCO stock. Therefore, any analyses related to our CEO compensation which includes data prior to 2019 is not indicative of our actual CEO compensation practices.
Base Salary
We establish base salaries for NEOs that reflect each executive’s experience, expertise and the complexity of their role, as well as current competitive compensation data. The Compensation Committee reviews base salaries of our NEOs annually and approves increases considering factors such as performance and market competitiveness.
20202022 Base Salary Decisions
Effective February 4, 2020,In 2022, Mr. Wells and Ms. Feldman received a base salary increase of 20%, which was applied retroactively to January 1, 2020, to move her salary toward the 50th percentile of our peer group and to reflect her strong performance in her role. Ms. Feldman’s increase was contingent upon her agreeing to extend the term of her employment contract.
For the period of April 1 – June 30, all NEOs agreed to forego a portion of their base salaryincreases, as a cost saving measure due to the pandemic. Messrs. Eccleshare and Wells agreed to forego 30% of their base salaries and each of the other NEOs agreed to forego 20% of their base salaries during this time period. As a result, each NEO’s salary for 2020 in the Summary Compensation Table is lower than the annual base salaries for 2020 set forth in the tabledescribed below.
2019 Salary | Contractural Salary | Percent Change | ||||||||||
C. William Eccleshare | $ | 1,250,000 | $ | 1,250,000 | 0.0 | % | ||||||
Brian D. Coleman | $ | 650,000 | $ | 650,000 | 0.0 | % | ||||||
Scott R. Wells | $ | 900,000 | $ | 900,000 | 0.0 | % | ||||||
Lynn A. Feldman | $ | 500,000 | $ | 600,000 | 1 | 20.0 | % | |||||
Jason A. Dilger | $ | 370,000 | $ | 370,000 | 0.0 | % |
12/31/2021 Salary |
Salary | Percent Change | ||||||||||
Scott R. Wells(1) | $ | 900,000 | $ | 1,100,000 | 22 | % | ||||||
Brian D. Coleman | $ | 650,000 | $ | 650,000 | 0.0 | % | ||||||
Lynn A. Feldman(2) | $ | 600,000 | $ | 650,000 | 7.7 | % | ||||||
Jason A. Dilger(3) | $ | 400,000 | $ | 400,000 | 0.0 | % |
On July 28, 2021, in connection with his transition from Executive Vice President, Chief Executive Officer Clear Channel Outdoor Americas to Chief Executive Officer (as more fully described below), we entered into an amended and restated employment agreement with Mr. Wells, pursuant to which his base salary was increased from $900,000 to $1,100,000 per annum, effective January 1, 2022. In setting Mr. Wells’ compensation following his transition to Chief Executive Officer, the Compensation Committee considered the compensation practices of our peer group and the positive impact retention of a skilled leader for our executive team would have on the Company and our ability to maximize value for our stockholders. |
(2) | On October 31, 2022, we entered into an amended and restated employment agreement with Ms. Feldman, pursuant to which her base salary was increased from $600,000 to $650,000 per annum, effective November 1, 2022. |
(3) | Effective January 1, 2022, in connection with entering into an amended and restated employment agreement, Mr. Dilger received a base salary increase |
Annual Incentive Plan
The 2015 Executive Incentive Plan (the “annual incentive plan”“Annual Incentive Plan”) provides NEOs with the opportunity to earn rewards based on the achievement of annual corporate and individual performance goals set by the Compensation Committee. Each named executive officerNEO has a target award opportunity, with no minimum (that is, the actual payment could be 0%) and a maximum as follows:
Chief Executive Officer: 145% of his target opportunity
All other NEOs: 200% of their target opportunityopportunity.
Actual target awards are based on:
38 Notice and Proxy Statement
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After the end of the fiscal year, the Compensation Committee determines the earned amounts by measuring the level of achievement of the Adjusted EBITDA-based performance goals and the individual performance goals. No award is earned under the Adjusted EBITDA performance goal if a minimum threshold of performance (90%(80% of the applicable target Adjusted EBITDA for each individual) is not achieved, and the maximum amount is earned only if the performance is at or above a maximum level (115%(125% of the applicable target Adjusted EBITDA for each individual). The Compensation Committee may, at its discretion, modify the awards earned for the Adjusted EBITDA objective and/or individual performance goals, as applicable.
Annual Incentive Plan Financial Measure
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We define Adjusted EBITDA as revenue less direct operating expenses and selling, general and administrative expenses, excluding restructuring and other costs, which are defined as costs associated with cost-saving initiatives such as severance, consulting and termination costs and other special costs. For purposes of the annual incentive plan, Plan Adjusted EBITDA excludes bonus expenses.
Annual Incentive Plan Objectives and Results
For 2020,2022, annual incentive plan objectives were established by the Compensation Committee at the beginning of the fiscal year for both CCOA and CCOH.
The financial objectives for our NEOs reflect their roles as follows:
The financial objectives for Messers. EccleshareMr. Wells and Mr. Coleman were based on Clear Channel Outdoor (CCOH) Adjusted EBITDA
Mr. Wells’ financial objective was based on CCOA Adjusted EBITDAEBITDA; and
The financial objectives for Ms. Feldman and Mr. Dilger were based on achievement of Clear Channel Outdoor (CCOH)CCOH and CCOA Adjusted EBITDA (with the weighting split 35% on each).
The COVID-19 pandemic had a significant unforeseen negative impact on our 2020 financial performance, which impacted our ability to achieve our annual incentive financial goals (which were established in early 2020), and rendered many of our NEO’s individual performance objectives obsolete or unachievable. In response to the effects of the COVID-19 pandemic, the Company and Compensation Committee considered several approaches to modifying the 2020 annual incentive plan with the intention of ultimately aligning payouts with performance controllable by management. Potential alternatives that were evaluated (and ultimately rejected) include “re-setting” financial goals based on updated financial projections, adjusting actual performance at the end of the year to eliminate the impact of COVID-19, transitioning to a new plan for the second-half of 2020, or providing a payout minimum or guarantee.Mr. Wells
Instead, the Compensation Committee, in conjunction with our independent compensation consultant, determined that the most appropriate approach would be to not adjust the financial goals under the annual incentive plan (which constitutes 70% of the total award opportunity), but rather, establish additional second half individual performance goals that would align 2020 performance with the interests of our employees and customers, and drive
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shareholder value creation over the long-term. Within this construct, NEO performance would be assessed holistically by the Committee at year-end. The Committee determined that this approach was modest relative to the range of potential alternatives, and would best balance the controllable performance of the management team during the calendar year with COVID-19’s impact on our Company, employees, and the broader economy.
The NEOs’ individual performance goals and achievements for 2020 included, but are not limited to, the following, which represent categories of objectives established at the beginning of 2020 as well as supplemental objectives relating to second-half 2020 performance that were established following the escalation of the COVID-19 pandemic. The discussion below highlights the key factors used in determining the awards for individual performance.
Mr. Eccleshare
Initial 20202022 Individual Performance Objectives:Objectives:
Lead the Company’s international divisions through reorganizationDeliver portfolio strategy and changebalance sheet enhancements;
LeadContinue to drive CCOH’s technology transformation and collaborate to advanceCCOA’s digital transformation, including through delivery of division strategies for screen conversions and development, programmatic growth, and development of our RADAR toolkit;
Improve CCOH and CCOA strategy,monetization;
Enhance CCOH and CCOA culture, including through improving employee engagement;
Enhance investor relations, including through conducting an Investors Date; and
Drive outstanding execution through growth of CCOA EBITDA ahead of revenue, support of key investments within the divisionincreasing CCOA’s digital footprint, and advancement of key cultural and talent initiatives across the Company
Continue to implement the investor relations strategy in alignment with corporate transactions with a view of reinforcing the positive messages to investors and markets on the impact of corporate transactions on the remaining organization and share price; and
Continue to set the tone from the top on compliance and support all related initiatives throughout the organization
Additional Objectives:
Achieve aggregated divisional financial goals for the second half of 2020 of $147.2 million
Manage costs effectively and continue to support efforts to address our capital structure
Develop and implement operating plan for all divisions in response to the COVID-19 impact aligned to the CCOH strategy; and
Focus on CCOH leadership and stability during the COVID-19 crisis
Key Achievements: Mr. Eccleshare led the Clear Channel organization and our senior leadership team throughout 2020 in managing the Company in the face of the pandemic, including key achievements relating to the implementation of agile working policies, enhanced communications across our global leadership team, the sale of our business in China (Clear Media), and an increased focus on our succession planning and diversity and inclusion initiatives. In addition, Mr. Eccleshare developed and implemented strategic operating plans across various international locations, achieved second-half cost management and EBITDA objectives and led the evaluation and/or execution of several potential corporate transactions. Mr. Eccleshare also continued his focus on outreach, communication and relationship building with our key shareholders and stakeholders.
Mr. Coleman
Initial 2020 Individual Performance Objectives:
Complete IT-focused separation and migration activities
Lead/support various processes to optimize desired outcome of strategic initiatives
Manage capital structure and ensure adequate corporate liquidity; and
Maintain operational excellence by ensuring that the Company’s financial units are strategically aligned and performing effectively
Additional Objectives:
Manage relationships with external financial and shareholder advisory firmsdriving collaboration among CCOA teams;
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ExpandKey Achievements: Mr. Wells led the Clear Channel organization and our senior leadership team throughout 2022 with an increased focus on enhanced investor relations and technology transformation. Under Mr. Wells’ leadership, Clear Channel hosted its inaugural Investors Day. In addition, Mr. Wells continued to source tuck-in asset acquisitions in the United States, improved CCOH and CCOA monetization, increased our digital footprint by approximately 100 units, continued to improve employee engagement across the business and worked to ensure the company continued to have an ample level of liquidity reporting during COVID-19 pandemicwhile continuing to consider strategies to reduce the company’s leverage ratio.
Mr. Coleman
2022 Individual Performance Objectives:
Enhance corporate access and investor relations, including through actively participating in investor conferences, leading enhanced disclosure initiatives, and improving analyst coverage;
Enhance communication with corporate CCOH staff in work-from-home environment;identity and culture, including through optimizing staffing plans and employee engagement and promoting a culture of compliance;
Maintain operational excellence across our corporate finance function by overseeing cross-functional alignment of corporate finance units and implementing an effective capital allocation process;
Manage capital structure and ensure adequate liquidity; and
Expand direct communicationManage and support strategic initiatives, including through optimizing our tax strategy with CCOH internal auditorsrespect to initiatives to minimize cash impact.
Key Achievements: Mr. Coleman played a key role in the support and management of multiple critical strategic initiatives during the course of 2020,2022, including leading our liquidity and de-risking initiatives and providing ongoing support for our M&A-related activities. activities and investor and analyst relationships. Mr. Coleman provided instrumental support and leadership with respect to the Company’s inaugural Investor Day. Mr. Coleman continued to lead CCOH’s highly functional corporate finance structure and executed on various initiatives relatingglobal M&A initiatives. He worked to changes in our financial reporting and disclosures, and oversaw our migrationensure the company continued to a new financial ERP system (Workday financials). Additionally,have an ample level of liquidity while continuing to consider strategies to reduce the company’s leverage ratio. Mr. Coleman effectively managedcontinued to successfully manage functional challenges including work from home/partial return to office dynamics to ensure effective performance of corporate teams and delivery of financial support and services. Additionally, he assisted with successfully managing our liquidity position during the COVID-19 pandemic, oversaw our capital allocation process, managed our financial and shareholder advisory relationships, and expanded communications with our internal auditors and internal finance teams.CEO transition in early 2022.
Mr. WellsMs. Feldman
Initial 20202022 Individual Performance Objectives:
Drive cultural changeContinue to embrace a growth-centric approach, including through growthenhance legal operations;
Provide effective board management and enhance corporate secretarial and public company functional improvements;
Further development of CCOA EBITDA ahead of revenueexecutive compensation function;
Continue momentum of largest clients through the execution of growth plans
Enhance digital tool set, communicate capabilitiesto enhance CCOH’s employee talent pool and use innovation to grow customer base
Drive local sales growth
Shepherd major investment opportunities to successful outcomes; and
Promote winning culture and continue to drive high talent standards
Additional Objectives:
Exceed second half EBITDA commitments
Close at least one direct-to-client big idea or political campaign
Lead a return-to-office effort that maximizes the agility of the business while respecting employees’ health needs
Stand up a strong diversity and inclusion advisory board and complete initial project prioritization of same; and
Accelerate orders development work
Key Achievements:Mr. Wells led the Clear Channel America’s business unit, notably including the achievement of second-half EBITDA performance commitments. Mr. Wells was responsible for several sales and operational accomplishments, including leading and closing various pitches to new clients, executing growth plans for current clients, and leading the evolution of our inventory and sales systems and our digital tools and capabilities. Additionally, Mr. Wells led the Return to Office and safety initiatives in the Americas, increased the focus on diversity and inclusion initiatives within the business and deployed a new “Vision/Mission/Values” approach to build momentum around excellence, recognition and fairness and led the renegotiation of site lease contracts resulting in significant rent abatements in the America during 2020.
Ms. Feldman
Initial 2020 Individual Performance Objectives:
Deliver on corporate transactions
Manage board management and corporate secretarial functional improvements
Drive continued improvements around CCOH public company disclosuresculture;
Continued development of compliance program; and
Continued development of legal support for programmatic/RADAR initiatives and digital conversionDeliver on corporate transactions.
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Additional Objectives:
Adapt remote/digital approach to shareholder and quarterly/periodic Board meetings;
Support renegotiations work during the course of 2020;
Implement seamless work-from-home and return-to-office protocols throughout US;
Work with CCOA/H to implement diversity & inclusion initiatives, including stand-up of diversity & inclusion council; and
Devise and implement revised LTI strategy
Key Achievements: Ms. Feldman led the Clear Channel legal and compliance functions throughout 2020,2022 and played a key role in supporting and negotiating various corporate transactions both pre and post-COVID-19.developing our executive compensation function, including by implementing an expanded equity program. In addition, to these significant transaction responsibilities, Ms. Feldman led several operational achievements within the legal function, including improvements relating toimplementing the management of Boardlegal operations function and shareholder meetings, enhancements to proxy and 10-K disclosuresupdated deal processes and further development ofdeveloping the compliance and internal training programs. Additionally,programs, as well as increasing employee engagement by 20 points. Ms. Feldman helped implement protocols relatingcontinued to our “Work From Home” and “Return to Work” initiatives, and rolledsupport the roll out newof diversity and inclusion and ESG initiatives within the organization. Additionally, she assisted with successfully managing our CEO transition in early 2022.
40 Notice and Proxy Statement 2023 |
Mr. Dilger
Initial 20202022 Individual Performance Objectives:
Drive operational excellence within the global accounting function;
LeadProvide accounting and business services teams through final phases of separation activities;transaction support for treasury initiatives;
Manage Workday financial system implementation;
EnhanceSupport strategic initiatives, including the European strategic alternatives, M&A and broaden business services functions;the continued digitization of our operations; and
Support capital markets transactionsContinue to optimize staffing plan and other strategic initiativesemployee engagement.
Additional Objectives:
Provide capital market, liquidity and strategic transaction support brought by COVID-19
Complete Workday financial and reporting structure enhancements while supporting work from home necessities due to COVID-19; and
Lead timely return-to-office initiative in alignment with COVID-19 evolution enabling staff to remain nimble, productive and safe
Key Achievements:Achievements: Mr. Dilger led the Clear Channel accounting and business services functions throughout 2020,2022 and played a key role in supporting several strategic initiatives throughout the year, including capital market transactionsstrategic alternatives for our European businesses, M&A and restructuring programs; creating, improvementsdivestiture transactions. He created enhancements to our financial reporting and earnings releases;releases and providingprovided invaluable support relating to divestiture, Treasury and other initiatives.our inaugural Investors Day including a number of enhanced disclosures. Mr. Dilger contributedcontinued to a timelyprovide direct responsibility for the Europe corporate accounting functions, which supported cost savings initiatives pursuant to restructuring programs, and effective migration to Workday and enabled staff to successfully provide uninterruptedhe drove executional excellence across all his global accounting andfunction teams. He improved business services support while mitigatingby enhancing both the changing COVID-19 impactsrobotic process automation and customer service support platforms and supporting the digitization of financial operations. In addition, he optimized staffing plans and implemented employee engagement initiatives that led to our work environment.positive employee engagement survey scores.
20202022 Annual Incentive Award (paid(to be paid in February 2021)March 2023)
In assessing whether or not it was appropriate to deliverAs a payment underresult of strong business performance across all our business units, along with the portionachievement of the annual incentive plan allocated to our NEO’stheir individual performance objectives, (which constitutes 30% of the total award opportunity), the Committee holistically considered various factors following the conclusion of 2020, including the aforementioned key achievements of the individual NEOs, the retentive impact of our broader compensation and benefits programs, and the following decisive actions taken to strengthen our current and future market position, including:
Executed targeted cost reduction and rightsizing efforts to align operations with market conditions;
Strengthened relationships with customers through elevated collaborations demonstrating our ability to capture audiences on the move;
Invested in the right technologies to strengthen our competitive offering and the power of our assets;
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Continued to win significant new contracts such as the largest US concession in NY/NJ and major wins in Europe including Madrid, Rome and Hammerson Malls and Leicester in the UK;
Expanded our data analytics, digital platform capabilities and strategic RADAR partnerships;
Divested China operations and further enhanced liquidity and capital structure flexibility;
Completed the Separation from and terminating the Transition Services Agreement with iHeartMedia; and
Positioned to emerge from the pandemic a stronger and more flexible company
After careful consideration of all of these factors, the Committee deemed that on balance, each of the NEOs achieved above “target” levels onof their performance objectives and that it was appropriate to approve a consistent payoutpayouts between 115% and 118% of 150% ofeach NEO’s individual target (i.e., halfway between “target” and “maximum” outcomes) for our executive officers reflecting their collaborative work and achievements in 2020. This determination resulted in an aggregate annual incentive plan payout of 45% of target, which appropriately balances the decreased financial performance with the achievements and decisive actions taken to strengthen our current and future market position.
opportunities. The following table provides a summary of the earned annual incentive payouts for each Named Executive OfficerNEO in 2020.2022, to be paid in March 2023.
Total Base Salary | Total Opportunity | Financial Portion Weight | Financial Portion Actual % of Target | MBO Portion Weight | MBO Portion Actual % of Target | Total Actual as a % of Target | Total Actual Amount Awarded | Total Base Salary | Total Opportunity | Financial Portion Weight | Financial Portion Actual % of Target | MBO Portion Weight | MBO Portion Actual % of Target | Total Actual as a % of Target | Total Actual Amount Awarded | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
C. William Eccleshare | 110 | % | $ | 1,375,000 | 70 | % | 0 | % | 30 | % | 150 | % | 45 | % | $ | 618,750 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Scott R. Wells | 110 | % | $ | 1,210,000 | 70 | % | 125.1 | % | 30 | % | 100 | % | 118 | % | $ | 1,422,842 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Brian D. Coleman | 100 | % | $ | 650,000 | 70 | % | 0 | % | 30 | % | 150 | % | 45 | % | $ | 292,500 | 100 | % | $ | 650,000 | 70 | % | 125.1 | % | 30 | % | 100 | % | 118 | % | $ | 764,336 | ||||||||||||||||||||||||||||||||||||||||
Scott R. Wells | 100 | % | $ | 900,000 | 70 | % | 0 | % | 30 | % | 150 | % | 45 | % | $ | 405,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lynn A. Feldman | 100 | % | $ | 600,000 | 70 | % | 0 | % | 30 | % | 150 | % | 45 | % | $ | 270,000 | 100 | % | $ | 608,356 | 70 | % | 121.8 | % | 30 | % | 110 | % | 118 | % | $ | 719,649 | ||||||||||||||||||||||||||||||||||||||||
Jason A. Dilger | 60 | % | $ | 222,000 | 70 | % | 0 | % | 30 | % | 150 | % | 45 | % | $ | 99,900 | 60 | % | $ | 240,000 | 70 | % | 121.8 | % | 30 | % | 100 | % | 115 | % | $ | 276,706 |
Retention and Signing Bonuses
As a part of his March 2019 employment agreement, Mr. Eccleshare received a cash retention bonus on January 1, 2020, subject to his continued employment through June 30, 2020, in the amount of $875,000. In the event Mr. Eccleshare’s employment ended on or before June 30, 2020, he agreed to repay the full after-tax value of the retention bonus within 10 days. This payment was intended to support his retention during the Company’s separation from iHeartMedia, which represented a time of significant uncertainty.
As part of a retention agreement, which was signed in 2018 in anticipation of the Company’s potential separation from iHeartMedia, Ms. Feldman received a retention bonus of $93,375 in August 2020 upon completion of the Transition Services Agreement with iHeartMedia.
Clear Channel Outdoor Holdings Supplemental Incentive Plan
The Clear Channel Outdoor Holdings (CCOH) supplemental incentive plan (SIP) was intended to provide additional bonus opportunities as an incentive to the NEOs to contribute to the growth, profitability and increased stockholder value of CCOH and for the retention of such executives. In 2018, Mr. Eccleshare participated in the SIP with an incentive opportunity of $300,000, based on achieving certain additional performance objectives established by Clear Channel Outdoor’s pre-Separation Compensation Committee for Mr. Eccleshare with respect to Clear Channel Outdoor’s business.
Of the $300,000 SIP bonus earned with respect to 2018 performance, $100,000 was paid at the end of February 2019, $100,000 was paid at the end of February 2020, and the remaining $100,000 was paid at the end of February 2021.
Equity Grants
Equity grants help to align executive interests with those of our stockholders. We have designed our annual equity program to support the objectives of our business, align with market practice, and provide incentive to deliver key financial metrics that are explicitly linked with stockholder value creation.
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Due to uncertainties caused by COVID-19, the 2020The annual equity grant was delayed until October 20, 2020 in orderawarded to better evaluate the ongoing impact of the pandemicour NEOs on our company. In future years, we intend to follow a standard practice of making annual equity grants in the first half of the year.May 4, 2022. Our long-term incentive program varies by role and is made up of 50%35%-45% restricted stock units (RSUs) and 50%55%-65% performance stock units (PSUs). The following criteria are evaluated for each of our NEOs when determining the value of their annual equity award:
Performance over the long term;
Performance during the prior year;
Long-term potential;
Economics of certain equity grants made in prior years;
Retention considerations; and
Market practices for comparable positions.
Notice and Proxy Statement 2023 41
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CEO Annual Equity Grant Mix | Other NEO Avg Annual Equity Grant Mix | |
Restricted Stock Units (RSUs) | Performance Stock Units (PSUs) | |||
Definition | Clear Channel Outdoor shares that vest upon meeting time-based vesting conditions | Clear Channel Outdoor shares that are earned by the executive upon achieving Relative Total Shareholder Return (TSR) performance goals and time-based vesting conditions | ||
Value | Clear Channel Outdoor stock price at vesting | Clear Channel Outdoor stock price at vesting | ||
% of Equity Grant | 35% - 45% | 55% - 65% | ||
Performance Metric | Time | Relative Total Shareholder Return (TSR) relative to the S&P 600 | ||
Vesting | One-third annually (on the anniversary of the grant) over three years | 0% to 150% after three-year performance period based on achievement of performance goal |
Adoption of the 2012 Second Amended and Restated Stock Incentive Plan
On May 5, 2021, the Company’s stockholders approved the adoption of the 2012 Second Amended and Restated Equity Incentive Plan (the “2021 Plan”), which amends and restates the 2012 Amended and Restated Stock Incentive Plan. The 2021 Plan is a broad-based incentive plan that provides for granting stock options, stock appreciation rights, restricted stock, restricted stock units, and performance-based cash and stock awards to any of the Company’s or its subsidiaries’ present or future directors, officers, employees, consultants, or advisers. The Company had 30,877,482 shares available for issuance under the 2021 Plan as of December 31, 2022, assuming a 100% payout of the Company’s outstanding performance stock units.
2022 Equity Compensation Decisions
On May 4, 2022, Messrs. Wells, Coleman and Dilger, and Ms. Feldman received the Annual Grants. The grant date fair value of each award was based on each NEO’s performance over the long term and during the prior year, their long-term potential and retention considerations, and market practices for comparable positions. On average, the equity grants consisted of 38% RSUs and 62% PSUs. The RSUs vest in three equal installments on April 1 of 2023, 2024 and 2025 for each NEO. The PSUs are earned based on the Company’s Relative Total Shareholder Return (TSR) achievement against the S&P 600 Index, and the entire earned amount will be paid out within 60 days following the end of the performance period on March 31, 2025.
Annual RSUs | Annual PSUs | Total 2022 Grant Value(1) | ||||||||||
Scott R. Wells | $ | 763,045 | $ | 1,624,998 | $ | 2,388,043 | ||||||
Brian D. Coleman | $ | 436,027 | $ | 749,998 | $ | 1,186,024 | ||||||
Lynn A. Feldman | $ | 279,057 | $ | 479,998 | $ | 759,055 | ||||||
Jason A. Dilger | $ | 127,537 | $ | 178,748 | $ | 306,285 |
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Using Relative Total Shareholder Return (“TSR”) as the PSU Performance Metric
2020 Equity Compensation DecisionsRelative TSR compared to the S&P 600 Index was selected as the performance metric for PSU awards because it rewards long-term stockholder value creation, aligning the interests of our executives and stockholders. The TSR of Clear Channel Outdoor will be measured at the end of the performance period relative to the S&P 600.
On OctoberThe TSR calculation for Clear Channel Outdoor and each of the companies in the S&P 600 will be based on the average stock price of each company over the 20 2020, our NEOs receivedtrading days following the following annual equity grant date fair values which are intendedbeginning of the performance period, and the average stock price of each company over the 20 trading days prior to move our officers closerthe end of the performance period (defined at grant). Based on the payout scale of the plan, the percentile rank translates into a payout percentage. If the TSR over the performance period for Clear Channel Outdoor is less than zero, the payout percentage is capped at 100%. The target number of shares is then multiplied times the payout percent to market median grant values fordetermine the earned number of shares that will be distributed to the participant once the award is vested.
PSUs Granted in 2022
Pursuant to the PSUs granted on May 4, 2022, each individual’s positionNEO is eligible to receive shares of Clear Channel Outdoor common stock ranging from 0% to 150% of target based on an annualized basis:Clear Channel Outdoor’s achievement of a Relative TSR goal over the performance period from April 1, 2022 to March 31, 2025:
RSUs | PSUs | Total | |||||||||||||
C. William Eccleshare | $ | 699,029 | $ | 750,000 | $ | 1,449,029 | |||||||||
Brian D. Coleman | $ | 466,019 | $ | 500,000 | $ | 966,019 | |||||||||
Scott R. Wells | $ | 559,223 | $ | 600,000 | $ | 1,159,223 | |||||||||
Lynn A. Feldman | $ | 326,213 | $ | 350,000 | $ | 676,213 | |||||||||
Jason A. Dilger | $ | 93,204 | $ | 100,000 | $ | 193,204 |
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Total Shareholder Return Relative to S&P 600
Performance Goal | Performance Vesting Percentage | |||
Below Threshold Level | <30th Percentile relative to S&P 600 | 0% | ||
Threshold Level | 30th Percentile relative to S&P 600 | 50% | ||
Target Level | 60th Percentile relative to S&P 600 | 100% | ||
Maximum Level | 90th Percentile relative to S&P 600 | 150% |
Note: straightStraight line interpolation is used to determine the performance vesting percentage between threshold and maximum.
PSUs Granted in 20192021 and 2020
We granted PSUs on October 15, 2019July 27, 2021 (the “2019“2021 PSUs”). The performance period for the 20192021 PSUs is in progress, and the payout of the 20192021 PSUs will not be determinable until after the performance period is completed on March 31, 2022.2024. Pursuant to the 20192021 PSUs, each NEO is eligible to receive shares of Clear Channel Outdoor common stock ranging from 0% to 150% of target based on Clear Channel Outdoor’s achievement of a Relative TSR goal over the 2.5-year2.75 year performance period from OctoberJuly 1, 20202021 to March 31, 2022,2024, based on the same performance goals as described for our 20202022 PSUs.
Vesting of Performance-Based Options
On March 3, 2015, Mr. Wells wasWe granted an option to purchase 338,600 sharesPSUs on October 20, 2020 (the “2020 PSUs”). The performance period for the 2020 PSUs is in progress, and the payout of the common stock under2020 PSUs will not be determinable until after the performance period is completed on March 31, 2023. Pursuant to the 2020 PSUs, each NEO is eligible to receive shares of Clear Channel Outdoor 2012 Stock Incentive Plan. Fifty percentcommon stock ranging from 0% to 150% of target based on Clear Channel Outdoor’s achievement of a Relative TSR goal over the award vested over time, and fifty percent of2.5-year performance period from October 1, 2020 to March 31, 2023, based on the award has performance-based vesting (the “Performance Options”). On February 3, 2020, thesame performance criteriagoals as described for half of the Performance Options was met because CCOA met an OIBDAN target of $471 million, resulting in the vesting of 84,650 Performance Options.our 2022 PSUs.
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EXECUTIVE BENEFITS AND PERQUISITES
In 2020,2022, we provided retirement benefits to our NEOs except Mr. Eccleshare, through Company matching contributions to the 401(k) retirement savings plan as well as access to health, disability and life insurance programs, which are the same plans available to all U.S. employees.
Mr. Eccleshare, who is a citizen of the United Kingdom, participates in a private pension plan (not sponsored by Clear Channel Outdoor) and, pursuant to his employment agreement, is entitled to have the Company contribute a portion of his salary to the private pension plan. The pension plan provides pension income at retirement based upon contributions made during the employee’s years of participation. Mr. Eccleshare is required to make contributions to this scheme in order for the Company to make contributions (or provide cash benefits to him as salary in lieu of such contributions). Pursuant to his employment agreement, he also receives a car allowance in the United Kingdom, and tax services and gross-up. In addition, because he is a citizen of the United Kingdom, Clear Channel Outdoor provides private medical insurance benefits and supplemental life insurance to Mr. Eccleshare.
The Company has a furnished apartment in New York City that Mr. Wells uses when he is working in our corporate office in New York. We also pay for Mr. Wells’ travel expenses between his home in Massachusetts and New York City, and certain other expenses, including transportation and non-working meals, while he is working in New York City. These amounts are included under “Other Compensation” in the Summary Compensation Table based on SEC guidance.
Notice and Proxy Statement 2023 43 |
OTHER KEY FEATURES OF OUR EXECUTIVE COMPENSATION PROGRAM
Stock Ownership Guidelines
Our new stock ownership guidelines, effective January 1, 2020, require all NEOs and other members of the Executive Team with a base salary of at least $500,000 to hold a minimum number of shares of Clear Channel Outdoor stock while serving in their leadership position. The guidelines are intended to further align the interests of executives with those of our stockholders by requiring executives to be subject to the same long-term stock price volatility our stockholders experience.
Shares counted toward meeting the requirement include direct owned shares (including after-tax vested RSUs) and unvested RSUs. Unvested stock options and unearned PSUs do not count toward meeting the requirement. The ownership value for each participant will be measured annually based on the closing stock price as of December 31.
Current executives havehad five years from January 1, 2020 to meet the ownership guideline requirements for their position. New hires and newly promoted executives will have five years from their hire/promotion date to meet their requirement. Executives who have not yet met their requirement will be evaluated on a case-by-case basis.
Named Executive Officer | Stock Ownership Guideline | |
| 5 times base salary | |
Brian D. Coleman | ||
| 3 times base salary | |
Lynn A. Feldman | 3 times base salary | |
Jason A. Dilger | 1 times base salary |
Anti-Hedging and Anti-Pledging Policies
Our Insider Trading Policy prohibits hedging and pledging of our securities by any employee, including our NEOs without the prior approval of our General Counsel’sChief Legal Officer’s office.
Clawback Policy
The Compensation Committee has adopted a Clawback Policy that is applicable to our current and former NEOs and such other senior executives and employees as the Compensation Committee may designate from time to time. The policy provides that if the Compensation Committee determines one or more such individuals committed fraud or willful misconduct that caused or contributed to Clear Channel Outdoor restating its financial statements due to material noncompliance with financial reporting requirements under the securities laws, then the Compensation Committee will require reimbursement or forfeiture of any excess cash or equity incentive compensation, as defined in
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the policy, received by such individuals during the three completed fiscal years immediately preceding the date on which the Company is required to prepare an accounting restatement. We are reviewing the final rule issued by the SEC implementing the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act relating to recoupment of incentive-based compensation and will amend our clawback policy when the NYSE adopts final listing standards in accordance with the final rules.
SEVERANCE AGREEMENTS
Each named executive officerNEO is entitled to certain payments and benefits in certain termination situations or upon a change in control. Severance agreements are provided based on competitive market practice and the Company’s desire to ensure some level of income continuity should an executive’s employment be terminated without cause. Clear Channel Outdoor believes that its severance arrangements facilitate an orderly transition in the event of changes in management. For further information on severance payments and benefits, see “Executive Compensation—Potential Post-Employment Payments”.
44 Notice and Proxy Statement 2023 |
TAX AND ACCOUNTING TREATMENT
Deductibility of Executive Compensation
Section 162(m) of the Code placesplaced a limit of $1,000,000 on the amount of compensation Clear Channel Outdoor maycould deduct for Federal income tax purposes in any one year with respect to certain senior executives of Clear Channel Outdoor, which we referred to herein as the “Covered Employees.” The exemption from Section 162(m)’s deduction limit for performance-based compensation has been repealed, effective for taxable years beginning after December 31, 2018, such that compensation paid to Clear Channel Outdoor’s covered executive officers in excess of $1 million will not be deductible unless it qualifies for transition relief applicable to certain arrangements in place as of November 2, 2017.
In reviewing the effectiveness of the executive compensation program, the Compensation Committee considers the anticipated tax treatment to Clear Channel Outdoor and to the Covered Employees of various payments and benefits. To maintain flexibility in compensating the NEOs in a manner designed to promote varying corporate goals, the Compensation Committee will not necessarily limit executive compensation to that which is deductible under Section 162(m) of the Code and has not adopted a policy requiring all compensation to be deductible. The Compensation Committee will consider various alternatives to preserving the deductibility of compensation payments and may award compensation that is not deductible to the extent consistent with its other compensation objectives.
Accounting for Stock-Based Compensation
Clear Channel Outdoor accounts for stock-based payments, including awards under the 2012 Amended and Restated Stock Incentive2021 Plan, in accordance with the requirements of FASB ASC Topic 718.
Notice and Proxy Statement 2023 45 |
REPORT OF THE COMPENSATION COMMITTEE
We have reviewed and discussed with management the Compensation Discussion and Analysis prepared by management. Based on this review and discussion, we have recommended to the Board of Directors that the Compensation Discussion and Analysis prepared by management be included in this Proxy Statement and incorporated into our 20202022 Annual Report on Form 10-K.
Respectfully submitted,
The Compensation Committee of the Board of Directors
Thomas C. King (Chair)
Lisa Hammitt
Joe Marchese
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The Summary Compensation Table below provides compensation information for the years ended December 31, 2022, 2021 and 2020 2019 and 2018 for our NEOs, which consist of the principal executive officer, the principal financial officer and theour next threetwo most highly compensated executive officers serving during 2020 (collectively, the “named executive officers”). As described below under “Certain Relationships and Related Party Transactions—Certain Relationships and Related Party Transactions Prior to the Separation—Corporate Services Agreement,” a portion of the compensation for 2019 and 2018 for Brian D. Coleman paid by iHeartMedia was allocated to us in recognition of the services provided to us. Those allocated amounts are reflected in the Summary Compensation Table below, along with any compensation that we or our subsidiaries provided to him directly.2022.
Name and Principal Position | Year | Salary ($) | Bonus(a) ($) | Stock Awards(b) ($) | Option Awards(b) ($) | Non-Equity Incentive Plan Compensation(c) ($) | All Other Compensation(d) ($) | Total ($) | ||||||||||||||||||||||||||||||||
C. William Eccleshare Chief Executive Officer(e) | 2020 | 1,174,054 | 871,521 | 1,449,029 | — | 715,892 | 327,463 | 4,537,958 | ||||||||||||||||||||||||||||||||
2019 | 1,295,950 | (f) | — | 2,929,549 | 4,500,000 | 1,512,071 | 339,608 | 10,577,178 | ||||||||||||||||||||||||||||||||
2018 | 1,060,827 | (f) | 905,894 | 1,186,250 | — | 1,375,478 | 239,337 | 4,767,787 | ||||||||||||||||||||||||||||||||
Brian D. Coleman Executive Vice President, Chief Financial Officer | 2020 | 617,500 | — | 966,019 | — | 292,500 | 5,000 | 1,881,019 | ||||||||||||||||||||||||||||||||
2019 | 519,393 | (g) | 12,500 | (g) | 1,356,022 | — | 595,294 | (g) | 2,152 | (g) | 2,485,362 | |||||||||||||||||||||||||||||
2018 | 252,000 | (g) | 80,063 | (g) | — | — | 402,292 | (g) | 2,248 | (g) | 736,602 | |||||||||||||||||||||||||||||
Scott R. Wells Chief Executive Officer – Americas division | 2020 | 832,500 | — | 1,159,223 | — | 405,000 | 137,683 | 2,534,406 | ||||||||||||||||||||||||||||||||
2019 | 850,000 | — | 1,199,998 | — | 1,114,721 | 221,614 | 3,386,333 | |||||||||||||||||||||||||||||||||
2018 | 750,000 | — | 1,186,250 | — | 883,823 | 157,488 | 2,977,561 | |||||||||||||||||||||||||||||||||
Lynn A. Feldman | 2020 | 570,000 | 93,375 | 676,213 | — | 270,000 | 26,293 | 1,635,881 | ||||||||||||||||||||||||||||||||
Executive Vice President, General Counsel and Secretary
| 2019 | 476,667 | 110,875 | 848,408 | — | 502,392 | 29,471 | 1,967,813 | ||||||||||||||||||||||||||||||||
2018 | 415,000 | — | 237,251 | — | 288,947 | 5,000 | 946,198 | |||||||||||||||||||||||||||||||||
Jason A. Dilger | 2020 | 351,500 | — | 193,204 | — | 99,900 | 11,933 | 656,537 | ||||||||||||||||||||||||||||||||
Chief Accounting Officer | 2019 | 351,167 | 75,000 | 134,999 | — | 240,232 | 17,027 | 818,425 |
Name and Principal Position | Year | Salary ($) | Bonus ($)(a) | Stock Awards ($)(b) | Non-Equity Incentive Plan Compensation ($)(c) | All Other Compensation ($)(d) | Total ($) | |||||||||||||||||||||
Scott R. Wells President and Chief Executive Officer | 2022 | 1,100,000 | — | 3,350,658 | 1,422,842 | 89,121 | 5,962,621 | |||||||||||||||||||||
2021 | 900,000 | — | 1,825,856 | 1,557,000 | 108,978 | 4,391,834 | ||||||||||||||||||||||
2020 | 832,500 | — | 1,159,223 | 405,000 | 137,683 | 2,534,406 | ||||||||||||||||||||||
Brian D. Coleman Executive Vice President, Chief Financial Officer | 2022 | 650,000 | — | 1,186,024 | 764,336 | 5,000 | 2,605,360 | |||||||||||||||||||||
2021 | 650,000 | — | 1,448,511 | 1,105,000 | 5,000 | 3,208,511 | ||||||||||||||||||||||
2020 | 617,500 | — | 966,019 | 292,500 | 5,000 | 1,881,019 | ||||||||||||||||||||||
Lynn A. Feldman Executive Vice President, Chief Legal Officer and Corporate Secretary | 2022 | 608,356 | — | 759,055 | 719,649 | 5,000 | 2,092,060 | |||||||||||||||||||||
2021 | 600,000 | — | 1,119,856 | 1,038,000 | 9,579 | 2,767,436 | ||||||||||||||||||||||
2020 | 570,000 | 93,375 | 676,213 | 270,000 | 26,293 | 1,635,881 | ||||||||||||||||||||||
Jason A. Dilger Chief Accounting Officer | 2022 | 400,000 | — | 306,285 | 276,706 | 5,000 | 987,991 | |||||||||||||||||||||
2021 | 378,769 | — | 374,907 | 391,909 | 7,002 | 1,152,586 | ||||||||||||||||||||||
2020 | 351,500 | — | 193,204 | 99,900 | 11,933 | 656,537 |
(a) | The |
For Mr. Eccleshare, (1) for 2020, a cash payment of $871,521 as a 2020 retention award; and (2) for 2018, a cash payment of $905,894 as a 2018 retention award.
For Mr. Coleman, (1) for 2019, a cash payment pursuant to his new employment contract with Clear Channel Outdoor, and (2) for 2018, the portion allocated to CCOH of the accelerated payment of the first quarterly bonus of $190,625 under the iHeartMedia, Inc. 2018 Key Employee Incentive Plan (the “iHeartMedia 2018 KEIP”).
For Ms. Feldman, (1) for 2020, a cash payment of $93,375 as a retention award; (2) for 2019, a cash payment of $17,500 pursuant to the first amendment to her employment contract and (3) for 2019, a cash payment of $93,375 as a retention award.
For Mr. Dilger, a cash payment in 2019 of $75,000 as a retention award.
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(b) | The amounts shown in the Stock Awards column include the full grant date fair value of options, restricted stock, restricted stock units (“RSUs”) and performance stock units (“PSUs”) awarded to Messrs. |
Name | Grant Date Fair Value Assuming Target Performance ($) | Grant Date Fair Value Assuming Maximum Performance ($) | ||||||||
Mr. Eccleshare | $ | 750,000 | $ | 1,125,000 | ||||||
Mr. Coleman | 500,000 | 750,000 | ||||||||
Mr. Wells | 600,000 | 900,000 | ||||||||
Ms. Feldman | 350,000 | 525,000 | ||||||||
Mr. Dilger | 100,000 | 150,000 |
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Name | Grant Date Fair Value Assuming Target Performance ($) | Grant Date Fair Value Assuming Maximum Performance ($) | ||||||||
Mr. Wells | 1,624,998 | 2,437,497 | ||||||||
Mr. Coleman | 749,998 | 1,124,997 | ||||||||
Ms. Feldman | 479,998 | 719,997 | ||||||||
Mr. Dilger | 178,748 | 268,122 |
For further discussion of the assumptions made in valuation, see also Note 13-Stockholders’ Deficit beginning on page |
(c) | The amounts |
For Mr. Eccleshare, (1) cash payments of $616,290 for 2020, $1,313,908 for 2019, and $1,075,239 for 2018 from Clear Channel Outdoor as annual incentive plan awards under the 2015 Executive Incentive Plan pursuant to pre-established performance goals; (2) for 2020, a cash payment in 2021 of the final one-third ($100,000) of the $300,000 earned pursuant to the 2018 SIP bonus; (3) for 2019, a cash payment in 2020 of (a) the final one-third ($100,000) of the $300,000 earned pursuant to the 2017 SIP bonus and (b) the second one-third ($100,000) of the $300,000 earned pursuant to the 2018 SIP bonus; and (4) for 2018, a cash payment in 2019 of (a) the final one-third ($90,000) of the $270,000 earned pursuant to the 2016 SIP bonus, (b) the second one-third ($100,000) of the $300,000 earned pursuant to the 2017 SIP bonus and (c) one-third ($100,000) of the $300,000 earned pursuant to the 2018 SIP bonus
For Mr. Coleman, cash payments of $292,500 for 2020 and $486,227 for the period from May 2019 through December 2019 from Clear Channel Outdoor as annual incentive plan awards under the 2015 Executive Incentive Plan pursuant to pre-established performance goals, and the portion allocated to Clear Channel Outdoor of: (1) for 2019, a cash payment of $253,468 from iHeartMedia as annual incentive plan award for the period from January through April 2019 under the iHeartMedia, Inc. 2019 Key Employee Incentive Plan (the “iHeartMedia 2019 KEIP”); and (2) for 2018, (a) a cash payment of $632,837 from iHeartMedia as annual incentive plan awards for the second, third and fourth quarters of 2018 under the iHeartMedia 2018 KEIP and (b) an accelerated cash payment of $325,000 earned pursuant to an iHeartMedia SIP bonus based on pre-established performance goals with respect to 2018 and 2017.
For Mr. Wells, cash payments of $405,000 for 2020, $1,114,721 for 2019, and $883,823 for 2018 from Clear Channel Outdoor as annual incentive plan awards under the 2015 Executive Incentive Plan pursuant to pre-established performance goals.
For Ms. Feldman, cash payments of $270,000 for 2020, $502,392 for 2019, and $288,947 for 2018 from Clear Channel Outdoor as annual incentive plan awards under the 2015 Executive Incentive Plan pursuant to pre-established performance goals.
For Mr. Dilger, (1) a cash payment of $99,900 for 2020 from Clear Channel Outdoor as an annual incentive plan award under the 2015 Executive Incentive Plan pursuant to pre-established performance goals, and (2) an aggregate of $240,232 for 2019 from Clear Channel Outdoor as an annual incentive plan award under the 2015 Executive Incentive Plan and the Management Incentive Plan pursuant to pre-established performance goals.
(d) | As described below, for |
amounts we contributed under our 401(k) plan as a matching contribution for the benefit of Messrs. Wells, Coleman, Wells and Dilger and Ms. Feldman in the United States or payments in lieu of pension contributions for the benefit of Mr. Eccleshare in the United Kingdom;
personal tax services paid by us for Mr. Eccleshare;
tax gross-ups on tax services for Mr. Eccleshare;
legal expenses for Mr. Eccleshare;
the cost of private medical insurance for the benefit of Mr. Eccleshare;
the cost of premiums for a supplemental life insurance benefit for Mr. Eccleshare;
automobile allowances and transportation expenses for the benefit of Mr. Eccleshare in the United Kingdom;Feldman;
the cost of housing and related expenses in New York City for the benefit of Mr. Wells; and
the cost of transportation related to commuting for the benefit of Mr. Wells; andWells.
accrued dividends paid on Clear Channel Outdoor restricted shares that vested during 2020 for Messrs. Wells and Dilger and Ms. Feldman.
Wells | Coleman | Feldman | Dilger | |||||||||||||
401(k) contributions | $ | 5,000 | $ | 5,000 | $ | 5,000 | $ | 5,000 | ||||||||
Housing & related expenses | $ | 54,960 | — | — | — | |||||||||||
Commuting expenses | $ | 29,161 | — | — | — | |||||||||||
Total | $ | 89,121 | $ | 5,000 | $ | 5,000 | $ | 5,000 |
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Eccleshare | Coleman | Wells | Feldman | Dilger | ||||||||||||||||
Plan contributions (or payments in lieu thereof) | $ | 186,754 | $ | 5,000 | $ | 5,000 | $ | 5,000 | $ | 5,000 | ||||||||||
Tax services | $ | 21,530 | ||||||||||||||||||
Tax services tax gross-up | $ | 19,093 | ||||||||||||||||||
Legal fees | $ | 19,241 | ||||||||||||||||||
Private medical insurance | $ | 31,680 | ||||||||||||||||||
Supplemental life insurance benefit | $ | 26,076 | ||||||||||||||||||
Automobile allowance/ transportation | $ | 23,089 | ||||||||||||||||||
Car service expense | ||||||||||||||||||||
Housing & related expenses | $ | 57,860 | ||||||||||||||||||
Commuting expenses | $ | 10,830 | ||||||||||||||||||
Accrued Dividends | $ | 63,993 | $ | 21,293 | $ | 6,933 | ||||||||||||||
Total | $ | 327,463 | $ | 5,000 | $ | 137,683 | $ | 26,293 | $ | 11,933 |
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The value of all benefits included in the All Other Compensation column is based on actual costs. For a description of the items reflected in the table above, see “—Employment Agreements with the Named Executive Officers” below. |
The value of the apartment made available to Mr. Wells is based on annual rent and related expenses paid by Clear Channel Outdoor, and the value of his travel and other expenses for |
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2020 | 2019 | 2018 | ||||||||||
C. William Eccleshare | $ | 22,402 | $ | 57,434 | $ | 25,520 |
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The Salary, Bonus, Non-Equity Incentive Plan Compensation and All Other Compensation columns presented above reflect the portion of the Salary, Bonus, Non-Equity Incentive Plan Compensation and All Other Compensation amounts allocated to us pursuant to the Corporate Services Agreement for Mr. Coleman for the period from January 2019 through April 2019, and 2018.
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iHeartMedia Salary | ||||||||||
January 1, 2019— April 30, 2019 | 2018 | |||||||||
Brian D. Coleman | $ | 200,000 | $ | 600,000 | ||||||
iHeartMedia Bonus and Non-Equity Incentive Plan Compensation | ||||||||||
January 1, 2019— April 30, 2019 | 2018 | |||||||||
Brian D. Coleman | $ | 253,468 | $ | 1,148,462 | ||||||
iHeartMedia All Other Compensation | ||||||||||
January 1, 2019— April 30, 2019 | 2018 | |||||||||
Brian D. Coleman | $ | 5,000 | $ | 5,000 |
EMPLOYMENT AGREEMENTS WITH THE NAMED EXECUTIVE OFFICERS
Messrs. Eccleshare,Wells, Coleman Wells and Dilger, and Ms. Feldman have employment agreements with us. Certain elements of their compensation are determined based on their respective employment agreements. The descriptions of the employment agreements effective as of December 31, 2022 set forth below do not purport to be complete and are qualified in their entirety by the employment agreements. For further discussion of the amounts of salary and bonus and other forms of compensation, see “Compensation Discussion and Analysis” above.
Each of the employment agreements discussed below provides for severance payments as described under “—Potential Post-Employment Payments” in this proxy statement,Proxy Statement, which descriptions are incorporated herein by reference.
C. William EccleshareScott R. Wells
On MarchMr. Wells assumed the role of President and Chief Executive Officer of the Company on January 1, 2019, Clear Channel Outdoor2022 and C. William Ecclesharewas appointed as a member of the Board.
In connection with the appointment of Mr. Wells as Chief Executive Officer, the Company and Mr. Wells entered into a new employment agreement. Thean amended and restated employment agreement, became effective upondated as of July 28, 2021 (the “Wells Amended and Restated Employment Agreement”).
Under the effective date of the Separation (the “Effective Date”), at which time the employment agreement supersededWells Amended and replacedRestated Employment Agreement, Mr. Eccleshare’s existing employment agreement. On the Effective Date, Mr. Eccleshare began to serve as the Company’s Chief Executive Officer.
The term of the employment agreement will end on December 31, 2021, and thereafter will extend for an additional one-year period if Clear Channel Outdoor provides at least ninety (90) days prior written notice to Mr. Eccleshare that the employment agreement shall be extended. Mr. EccleshareWells receives an annual base salary of $1,250,000 U.S. dollars (“Base Salary”). Clear Channel Outdoor (i) made a lump sum payment of $83,333, less applicable payroll taxes and other deductions, in respect of the period between January 1, 2019 and May 1, 2019 (such lump sum payment, the “Catch-Up Payment”), and (ii) contributed to Mr. Eccleshare’s pension plan (or pay as otherwise directed by Mr. Eccleshare, so long as such direction is consistent with past practice) an additional amount equal to the product of 0.15 multiplied by the amount of the Catch-Up Payment.
During the term of the employment agreement, Mr. Eccleshare$1,100,000 and is eligible to receiveearn an annual performance bonus with abased on the achievement of financial and performance criteria established by Clear Channel Outdoor and approved in the annual budget. The target ofperformance bonus that may be earned will be not less than 110% of Base Salary andMr. Wells’ base salary amount. In addition to the annual bonus, Mr. Wells is also eligible for an additional long-term incentive opportunity to earn up to 160% of Base Salary based on performance goals to be set by Clear Channel Outdoor. Mr. Eccleshare received a retention bonus payment (the “Second Retention Bonus Payment”“Long-Term Incentive Amount”) of $875,000 U.S. dollars in January 2020. If Mr. Eccleshare’s employment terminated byfrom Clear Channel Outdoor for Cause (as defined in the employment agreement) or bywith an approximate value of not less than $2,000,000. Mr. Eccleshare without Good Cause (as defined in the employment agreement) on or before June 30, 2020, then Mr. Eccleshare repay to Clear Channel Outdoor within ten days of his termination 100% of the After Tax Value of the Second Retention Bonus Payment. For the purposes of the employment Agreement, “After-Tax Value” means the applicable portion of the retention bonus payment net of any and all taxes and social security contributions, determined taking into account any tax benefit available in respect of such repayment.
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In 2019, Mr. EccleshareWells also received a one-time equity grant with an aggregate value of $6,000,000 U.S. dollars (the “2019 Equity Award Grant”). Seventy-five percent (75%) of the 2019 Equity Award Grant consists of stock options with a grant date fair value of $4,500,000 U.S. dollars and an exercise price based on the Volume Weighted Average Price of Clear Channel Outdoor stock for the fifteen trading days preceding the fifteen trading days following the Effective Date (the “Effective Date VWAP”). The remaining 25% of the 2019 Equity Award Grant consists of restricted stock units with the number of shares ofa grant value equal to $962,615. Mr. Wells is also eligible to participate in various benefit programs provided by Clear Channel Outdoor stock subjecton the same terms and conditions as they are made available to the restricted stock unit grant determined by dividing $1,500,000 U.S. dollars by the Effective Date VWAP and rounding down to the nearest whole number. One-third of the 2019 Equity Award Grant vested on December 31, 2019 and the remaining two-thirds will vest in equal annual installments on each of December 31, 2020 and December 31, 2021, if Mr. Eccleshare remains employed on each such annual vesting date. The strike price of the stock options is $5.11 and therefore, as of December 31, 2020, the value of the options is $0.
Clear Channel Outdoor will continue to contribute to Mr. Eccleshare’s personal pension plan registered under Chapter 2, Part 4 of the Finance Act of 2004 in the United Kingdom, as provided in his previous employment agreement. The Company also agreed to reimburse Mr. Eccleshare for the reasonable costs and expenses (not to exceed $25,000 annually, fully grossed-up for applicable taxes) associated with filing his U.S. and U.K. personal income tax returns, as applicable. Mr. Eccleshare is eligible to receive health and life insurance benefits and paid vacation on a basis no less favorable than provided to our similarly-situated senior executives; provided, however, that his life insurance benefit shall be for an amount equal to four times his annual base salary. The Company also agreed to provide a £1500 monthly car allowance, reimburse Mr. Eccleshare for travel and entertainment related expenses, consistent with past practices pursuant to Company policy, and reimburse Mr. Eccleshare for up to four long-haul flights per calendar year for his wife when she accompanies him on Company business.other similarly situated employees.
During Mr. Eccleshare’sWells’ employment with Clear Channel Outdoor and for 12 months thereafter, Mr. EccleshareWells is subject to non-competition, non-interference and non-solicitation covenants substantially consistent with our other senior executives. Mr. EccleshareWells is also is subject to customary confidentiality, work product and trade secret provisions. During the term of the employment agreement, Mr. Eccleshare may continue as a trustee of Donmar Warehouse and as a non-executive director of Centaur Media Plc and Britvic Plc.
Brian D. Coleman
On theEmployment Agreement Effective Date, in 2022
Clear Channel Outdoor and Brian D. Coleman entered into an employment agreement, dated May 1, 2019 (the “2022 Coleman Employment Agreement”), which superseded and replaced Mr. Coleman’s existingprior employment agreement.
The initial term of the employment agreement will2022 Coleman Employment Agreement would end on April 30, 2023, and thereafter willwould extend for additional three year periods unless Clear Channel Outdoor or Mr. Coleman providesprovided written notice of non-renewal of the employment agreement between October 1st1 and November 1st1 (the “Notice of Non-Renewal Period”) prior to the end of the then applicable employment period. Under the employment agreement,2022 Coleman Employment Agreement, Mr. Coleman receives an annual base salary of $650,000, which is subject to increase at Clear Channel Outdoor’s discretion, and received a one-time signing bonus of $12,500 in 2019.discretion.
During the term of the employment agreement,2022 Coleman Employment Agreement, Mr. Coleman is eligible to receive (i) an annual performance bonus with a target of not less than 100% of his base salary based on applicable performance goals to be set by Clear Channel Outdoor, (ii) a one-time long-term incentive opportunity with an approximate value of $500,000, to be allocated between stock options and restricted stock at the discretion of the Compensation Committee and (iii) additional long-term incentive opportunities, with an approximate value of $300,000 per award, to be allocated between stock options and restricted stock at the discretion of the Compensation Committee. Mr. Coleman is also eligible to participate in various benefit programs provided by Clear Channel Outdoor on the same terms and conditions as they are made available to other similarly situated employees.
48 Notice and Proxy Statement 2023 |
Clear Channel Outdoor may elect at any time prior to the Notice of Non-Renewal Period to place Mr. Coleman in a consulting status for 12 months (a “Consulting Period”). During a Consulting Period, Clear Channel Outdoor will limit its requests for services to allow Mr. Coleman to accept and perform non-competitive services, but his eligibility to participate in certain benefit plans may change or be terminated in accordance with such benefit plans, and any vacation benefits, long-term incentive awards or options shall not continue to vest or accrue. A Consulting Period under the employment agreement will be coextensive with and may extend the term of Mr. Coleman’s employment under the employment agreement, after which such employment period shall end.
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During Mr. Coleman’s employment with Clear Channel Outdoor and for 12 months thereafter, Mr. Coleman is subject to non-competition, non-interference and non-solicitation covenants substantially consistent with our other senior executives. Mr. Coleman is also is subject to customary confidentiality, work product and trade secret provisions.
Scott R. Wells
Employment Agreement Effective March 3, 2015, Clear Channel Outdoor entered into an employment agreement with Mr. Wells. The employment agreement had an initial term (the “Initial Term”) that ended on March 2, 2019, and thereafter provides for automatic four-year extensions, unless either Clear Channel Outdoor or Mr. Wells gives prior notice electing not to extend the agreement.as of April 1, 2023
On March 26, 2019,7, 2023, Clear Channel Outdoor and Mr. WellsColeman entered into a First Amendment to Employment Agreement (the “Amendment”). The Amendment became effective upon the Separation of Clear Channel Outdoor from iHeartMedia. Asan amended theand restated employment agreement provides that (i) Mr. Wells’ base salary increased to $900,000(the “Coleman Amended and (ii) upon a termination of Mr. Wells’ employment by Clear Channel Outdoor without Cause, non-renewal of the employment agreement by Clear Channel Outdoor or termination of employment by Mr. Wells for Good Reason, all of Mr. Wells’ unvested time vesting equity awards that are scheduled to vest within twelve months following the date of termination will vest in full on the date of termination (previously, only time-vesting options were eligible for such accelerated vesting)Restated Employment Agreement”), and any unvested performance vesting options will remain eligible to vest for three months following the date of termination.
Mr. Wells has the opportunity to earn an annual performance bonus for the achievement of financial and performance criteria established by Clear Channel Outdoor and approved in the annual budget. The target performance bonus that may be earned will be not less than 100% of Mr. Wells’ base salary amount (the “Target Bonus”). In addition to the annual bonus, Mr. Wells is also eligible for an additional long-term incentive opportunity (the “Long-Term Incentive Amount”) from Clear Channel Outdoor with an approximate value of $1,000,000 for each award, consistent with other comparable positions pursuant to the terms of the award agreement(s), taking into consideration demonstrated performance and potential, and subject to approval by the board of directors or the compensation committee of Clear Channel Outdoor, as applicable. The employment agreement also entitles Mr. Wells to participate in all employee welfare benefit plans in which other similarly situated employees of Clear Channel Outdoor may participate. Clear Channel Outdoor will reimburse Mr. Wells for the attorneys’ fees incurred by Mr. Wells in connection with the negotiation of the employment agreement and ancillary documents, up to a maximum reimbursement of $25,000 in the aggregate. The employment agreement also contains a customary confidentiality provision that survives Mr. Wells’ termination of employment, as well as customary non-competition and non-solicitation provisions that apply during employment and for the 12-month period thereafter.
As provided in the employment agreement, the compensation committee of the Clear Channel Outdoor Board approved an award by Clear Channel Outdoor, effective as of March 3, 2015, of options to purchase common stock having a value equal to $1,500,000 asApril 1, 2023. The Coleman Amended and Restated Employment Agreement supersedes the 2022 Coleman Employment Agreement.
The initial term of the award date (based on the Black-Scholes valuation method). Fifty percent of the award has performance-based vesting (the “Performance Vesting Options”)Coleman Amended and fifty percent of the award vests over time (the “Time Vesting Options”). The Time Vesting Options vested in equal amounts on the first, second, third and fourth anniversaries of the Effective Date. Fifty percent of the Performance Vesting Options vested on February 3, 2020 based on the achievement of $472 million of OIBDAN for Clear Channel Outdoor Americas (“CCOA”) for 2019, which exceeded the performance hurdle of $471 million. The remaining fifty percent of the Performance Vesting Options will vest on the date that CCOA achieves certain financial and performance criteria, so long as Mr. Wells remains employed on the vesting date (except as set forth below in the event of a termination by Clear Channel Outdoor without Cause, if Mr. Wells terminates his employment for Good Reason or if Mr. Wells’ employment is terminated following Clear Channel Outdoor’s notice of non-renewal).
Lynn A. Feldman
On February 4, 2020, Lynn A. Feldman and the Company entered into a Second Amendment toRestated Employment Agreement (the “Second Amendment”) to Ms. Feldman’s employment agreement dated June 27, 2016. Pursuant to the Second Amendment, the employment agreement was amended to, among other things: (i) extend the term of Ms. Feldman’s employment agreement to Decemberends on March 31, 2022, after which time such employment period2026 and will be automatically extended for additional two yeartwo-year periods, unless either partythe Company or Mr. Coleman gives prior written notice of non-renewal; (ii) increase Ms. Feldman’s annual base salary to $600,000; (iii) increase Ms. Feldman’s target bonus to 100% of her base salary;non-renewal between September 1 and (iv) increase the value of Ms. Feldman’s annual long term incentive grants to $300,000 for each award. The
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Second Amendment is effective as of JanuaryOctober 1 2020. Ms. Feldman is eligible for salary increases at the discretion of Clear Channel Outdoor based on Company performance and/or individual performance.
In 2016, Ms. Feldman received a one-time long term incentive grant with a value of no less than $400,000 under the CCOH 2012 Stock Incentive Plan, with 50% of the award in the form of stock options and 50% in the form of restricted stock of Clear Channel Outdoor. Pursuant to the employment agreement, Ms. Feldman is eligible to receive annual long term incentive grants with a value of no less than $300,000 for each award consistent with other comparable positions pursuant to the terms of the award agreement(s), taking into consideration demonstrated performance and potential, and the allocation of each award between stock options and restricted stock, subject to approval by the board of directors or the compensation committee of Clear Channel Outdoor, as applicable. Ms. Feldman is entitled to participate in all employee benefit plans and perquisites in which other similarly situated employees may participate.
In August 2018, Ms. Feldman was awarded a retention bonus of $186,750. The retention bonus vests and is payable as follows: (i) 50% of the retention bonus was paid in 2019 and (ii) 50% was paid in August 2020, upon the termination of the Transition Services Agreement, in each case subject to Ms. Feldman’s continued employment on such date.
Under the employment agreement, Ms. Feldman is required to protect the secrecy of confidential information of Clear Channel Outdoor and to assign certain intellectual property rights. She also is prohibited by the agreement from engaging in certain activities that compete with Clear Channel Outdoor Americas during employment and for twelve (12) months after her employment terminates, and she is prohibited from soliciting employees of Clear Channel Outdoor Americas for employment during employment and for twelve (12) months after termination of employment.
Jason A. Dilger
On May 1, 2019, Clear Channel Outdoor and Jason A. Dilger entered into an employment agreement.
The initial term of the employment agreement will end on April 30, 2022, and thereafter will automatically extend for additional three year periods unless Clear Channel Outdoor or Mr. Dilger provides written notice of non-renewal of the employment agreement between October 1st and November 1st (the “Notice of Non-Renewal Period”) prior to the end of the then applicablethen-applicable employment period.
Under the employment agreement,Coleman Amended and Restated Employment Agreement, Mr. DilgerColeman receives an annual base salary of $370,000. Mr. Dilger$700,000, which is eligible for salary increasessubject to increase at the discretion of Clear Channel Outdoor based on Company performance and/or individual performance.
Outdoor’s discretion. During the term of the employment agreement,Coleman Amended and Restated Employment Agreement, Mr. DilgerColeman is eligible to receive (i) an annual performance bonus with a target of not less than 60%100% of his base salary (and prorated for changes in base salary or bonus target that occur during the applicable plan year) based on applicable performance goals to be set by Clear Channel Outdoorthe Compensation Committee, and (ii) long termbeginning in 2023, an annual long-term incentive opportunitiesopportunity, with an approximatea target value of $125,000 per award, toequal $1,350,000; provided, that, in no event will the grant date fair value be allocated between stock options and restricted stock at the discretion of the Compensation Committee.less than $300,000. Mr. DilgerColeman is also eligible to participate in various benefit programs provided by Clear Channel Outdoor on the same terms and conditions as they are made available to other similarly situated employees.
Other than the removal of the Consulting Period, the other terms of the Coleman Amended and Restated Employment Agreement are substantially similar to those of the 2022 Coleman Employment Agreement.
Lynn A. Feldman
Effective November 1, 2022, Clear Channel Outdoor may elect at any timeand Ms. Feldman entered into an amended and restated employment agreement (the “Feldman Employment Agreement”). The Feldman Employment Agreement supersedes the prior employment agreement between Ms. Feldman and Clear Channel Outdoor effective June 27, 2016, as amended on May 1, 2019 and January 1, 2020.
The initial term of the Feldman Employment Agreement ends on October 31, 2025 and will be automatically extended for additional two year periods, unless the Company or Ms. Feldman gives prior written notice of non-renewal of the Feldman Employment Agreement between March 1 and March 31 prior to the Noticeend of Non-Renewal Periodthe then-applicable employment term.
Pursuant to place Mr. Dilgerthe Feldman Employment Agreement, Ms. Feldman will (i) receive an annual base salary of $650,000, (ii) be eligible to receive an annual performance bonus with a target of 100% of her annual base salary, and (iii) beginning in a consulting status2023, an annual long-term incentive opportunity with an annual target value equal to $825,000; provided, that, in no event will the grant date fair value be less than $300,000. Ms. Feldman is also eligible to participate in various benefit programs provided by Clear Channel Outdoor on the same terms and conditions as they are made available to other similarly situated employees.
During Ms. Feldman’s employment with Clear Channel Outdoor and for 12 months (a “Consulting Period”). During a Consulting Period,thereafter, Ms. Feldman is subject to non-competition, non-interference and non-solicitation covenants substantially consistent with our other senior executives. Ms. Feldman is also subject to customary confidentiality, work product and trade secret provisions.
Notice and Proxy Statement 2023 49 |
Jason A. Dilger
On January 20, 2022, Clear Channel Outdoor will limit its requests for services to allowand Mr. Dilger to acceptentered into an amended and perform non-competitive services, but his eligibility to participate in certain benefit plans may change or be terminated in accordance with such benefit plans, and any vacation benefits, long-term incentive awards or options shall not continue to vest or accrue. A Consulting Period under therestated employment agreement (the “Dilger Amended and Restated Employment Agreement”), effective as of January 1, 2022.
The initial term of the Dilger Amended and Restated Employment Agreement ends on January 1, 2025 and will be coextensiveautomatically extended for additional three-year periods, unless the Company or Mr. Dilger gives prior written notice of non-renewal of the Dilger Amended and Restated Employment Agreement between June 1 and July 1 prior to the end of the then-applicable employment term.
Pursuant to the Dilger Amended and Restated Employment Agreement, Mr. Dilger will (i) receive a base salary at an annualized rate of $400,000 retroactive to October 1, 2021, (ii) be eligible to receive an annual performance bonus with a target of 60% of his annual base salary and may extend the term(iii) be eligible for an annual equity incentive grant with an approximate value of Mr. Dilger’s employment under the employment agreement.not less than $325,000 per award.
During the term of Mr. Dilger’s employment and for 12 months thereafter, Mr. Dilger is subject to non-competition, non-interference and non-solicitation covenants substantially consistent with Clear Channel Outdoor’s other senior executives. Mr. Dilger also is subject to customary confidentiality, work product and trade secret provisions.
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GRANTS OF PLAN-BASEDPLAN BASED AWARDS
Stock Incentive Plans
Clear Channel Outdoor grants equity incentive awards to named executive officersNEOs and other eligible participants under its 2012 Amended and Restated Stock Incentivethe 2021 Plan. The 2012 Amended and Restated Stock Incentive2021 Plan is intended to facilitate the ability of Clear Channel Outdoor to attract, motivate and retain employees, directors and other personnel through the use of equity-based and other incentive compensation opportunities.
The 2012 Amended and Restated Stock Incentive2021 Plan allows for the issuance of restricted stock, incentive and non-statutory stock options, stock appreciation rights, director shares, deferredrestricted stock rightsunits and other types of stock-based and/or performance-based awards to any present or future director, officer, employee, consultant or advisor of or to Clear Channel Outdoor or its subsidiaries.
The 2012 Amended and Restated Stock Incentive2021 Plan is administered by the Compensation Committee, except that the entire Board has sole authority for granting and administering awards to non-employee directors. The Compensation Committee determines which eligible persons receive an award and the types of awards to be granted as well as the amounts, terms and conditions of each award including, if relevant, the exercise price, the form of payment of the exercise price, the number of shares, cash or other consideration subject to the award and the vesting schedule. These terms and conditions will be set forth in the award agreement furnished to each participant at the time an award is granted to him or her under the 2012 Amended and Restated Stock Incentive2021 Plan. The Compensation Committee also makes other determinations and interpretations necessary to carry out the purposes of the 2012 Amended and Restated Stock Incentive2021 Plan. For a description of the treatment of awards upon a participant’s termination of employment or change in control, see “—Potential Post-Employment Payments.”
Cash Incentive Plan
As discussed above, named executive officersNEOs also are eligible to receive awards under the Annual Incentive Plan. See “Compensation Discussion and Analysis—Analysis of 20202022 Executive Compensation Decisions—Annual Incentive Plan” for a more detailed description of the Annual Incentive Plan and the grant of awards to the named executive officersNEOs thereunder.
The following table sets forth certain information concerning plan-based awards granted to the named executive officersNEOs during the year ended December 31, 2020.
Grants of Plan-Based Awards During 2020
Name | Grant Date | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards | Estimated Future Payouts Under Equity Incentive Plan Awards | All Other Stock Awards: Number of shares of Stock | All Other Option Awards: Number of Securities Underlying | Exercise of Base Price of Option | Grant Date Fair Value of Stock and Option | |||||||||||||||||||||||||||||||||||
Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | or Units (#) | Options (#) | Awards ($/Sh) | Awards(a) ($) | |||||||||||||||||||||||||||||||||
C. William Eccleshare | N/A(b) | 1,375,000 | 2,000,000 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
10/20/20(c) | — | — | — | — | — | 728,155 | — | — | 699,029 | |||||||||||||||||||||||||||||||||
10/20/20(c) | — | — | 375,000 | 750,000 | 1,125,000 | — | — | — | 750,000 | |||||||||||||||||||||||||||||||||
Brian D. Coleman | N/A(b) | 650,000 | 1,300,000 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
10/20/20(d) | — | — | — | — | — | 485,436 | — | — | 466,019 | |||||||||||||||||||||||||||||||||
10/20/20(d) | — | — | 250,000 | 500,000 | 750,000 | — | — | — | 500,000 | |||||||||||||||||||||||||||||||||
Scott R. Wells | N/A(b) | 900,000 | 1,800,000 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
10/20/20(e) | — | — | — | — | — | 582,524 | — | — | 559,223 | |||||||||||||||||||||||||||||||||
10/20/20(e) | — | — | 300,000 | 600,000 | 900,000 | — | — | — | 600,000 | |||||||||||||||||||||||||||||||||
Lynn Feldman | N/A(b) | 600,000 | 1,200,000 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
10/20/20(f) | — | — | — | — | — | 339,805 | — | — | 326,213 | |||||||||||||||||||||||||||||||||
10/20/20(f) | — | — | 175,000 | 350,000 | 525,000 | — | — | — | 350,000 | |||||||||||||||||||||||||||||||||
Jason Dilger | N/A(b) | 222,000 | 444,000 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||
10/20/20(g) | — | — | — | — | — | 97,087 | — | — | 93,204 | |||||||||||||||||||||||||||||||||
10/20/20(g) | — | — | 50,000 | 100,000 | 150,000 | — | — | — | 100,000 |
2022.
50 Notice and Proxy Statement
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Grants of Plan-Based Awards During 2022
Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | Estimated Future Payouts Under Equity Incentive Plan Awards | All Other Stock Awards: Number of Shares of Stock | All Other Option Awards: Number of Securities Underlying | Exercise or Base Price of Option | Grant Date Fair Value of Stock and Option | |||||||||||||||||||||||||||||||||||
Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | or Units (#) | Options (#) | Awards ($/Sh) | Awards(a) ($) | |||||||||||||||||||||||||||||||||
Scott R. Wells | N/A(b) | — | 1,210,000 | 2,420,000 | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||
1/20/22(c) | — | — | — | — | — | — | 311,526 | — | — | 962,615 | ||||||||||||||||||||||||||||||||
5/4/22(d) | — | — | — | — | — | — | 294,612 | — | — | 763,045 | ||||||||||||||||||||||||||||||||
5/4/22(d) | — | — | — | 300,926 | 601,851 | 902,777 | — | — | — | 1,624,998 | ||||||||||||||||||||||||||||||||
Brian D. Coleman | N/A(b) | — | 650,000 | 1,300,000 | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||
5/4/22(e) | — | — | — | — | — | — | 168,350 | — | — | 436,026 | ||||||||||||||||||||||||||||||||
5/4/22(e) | — | — | — | 138,889 | 277,777 | 416,666 | — | — | — | 749,998 | ||||||||||||||||||||||||||||||||
Lynn Feldman | N/A(b) | — | 608,356 | 1,216,712 | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||
5/4/22(f) | — | — | — | — | — | — | 107,744 | — | — | 279,057 | ||||||||||||||||||||||||||||||||
5/4/22(f) | — | — | — | 88,889 | 177,777 | 266,666 | — | — | — | 479,998 | ||||||||||||||||||||||||||||||||
Jason Dilger | N/A(b) | — | 240,000 | 480,000 | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||
5/4/22(g) | — | — | — | — | — | — | 49,242 | — | — | 127,537 | ||||||||||||||||||||||||||||||||
5/4/22(g) | — | — | — | 33,102 | 66,203 | 99,305 | — | — | — | 178,748 |
(a) | The amounts in the table reflect the full grant date fair value of options, RSUs and PSUs computed in accordance with the requirements of ASC Topic 718, but excluding any impact of estimated forfeiture rates as required by SEC regulations. The grant date fair value of time-vesting RSUs is based on the closing price of our common stock on the date of grant. The grant date fair value of PSUs is based on a Monte Carlo valuation as of the grant date assuming achievement at the target payout level, or 100%. For assumptions made in the valuation, see footnote (b) to the Summary Compensation Table above and Note 13-Stockholders’ Deficit beginning on page |
(b) | Messrs. |
(c) | On |
(d) | On May 4, 2022, Mr. Wells received a grant of 896,463 shares of Clear Channel Outdoor’s common stock. The RSUs will vest as follows: (1) |
On |
On |
On |
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Notice and Proxy Statement
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OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
The following table sets forth certain information concerning outstanding equity awards of the named executive officersNEOs at December 31, 2020.2022.
Outstanding Equity Awards at December 31, 20202022
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||
Number of Securities Underlying Unexercised Options | Option | Option | Number of Shares or Units of Stock That | Market Value of Shares or Units of Stock That | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That | ||||||||||||||||||||||||||
Name | (#) Exercisable | (#) Unexercisable | Exercise Price ($) | Expiration Date | Have Not Vested (#) | Have Not Vested(a) ($) | Not Vested (#) | Have Not Vested(a) ($) | ||||||||||||||||||||||||
C. William Eccleshare | 90,000 | — | $ | 6.09 | 2/21/2021 | — | — | — | — | |||||||||||||||||||||||
90,000 | — | $ | 5.02 | 3/26/2022 | — | — | — | — | ||||||||||||||||||||||||
1,459,854 | (b) | 729,927 | (b) | $ | 5.11 | 6/3/2029 | — | — | — | — | ||||||||||||||||||||||
— | — | — | — | 221,729 | (c) | $ | 365,853 | — | — | |||||||||||||||||||||||
— | — | — | — | 97,847 | (d) | $ | 161,448 | — | — | |||||||||||||||||||||||
— | — | — | — | 208,334 | (e) | $ | 343,751 | — | ||||||||||||||||||||||||
157,563 | (f) | $ | 259,979 | |||||||||||||||||||||||||||||
— | — | — | — | 728,155 | (g) | $ | 1,201,456 | — | — | |||||||||||||||||||||||
— | — | — | — | — | — | |||||||||||||||||||||||||||
— | — | — | — | — | — | 1,125,000 | (h) | $ | 1,856,250 | |||||||||||||||||||||||
Brian D. Coleman | — | — | — | — | 104,602 | (i) | 172,593 | — | — | |||||||||||||||||||||||
— | — | — | — | 112,500 | (j) | 185,625 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 85,084 | (f) | $ | 140,389 | |||||||||||||||||||||||
— | — | — | — | 485,436 | (k) | $ | 800,969 | |||||||||||||||||||||||||
— | — | — | — | 750,000 | (h) | $ | 1,237,500 | |||||||||||||||||||||||||
Scott R. Wells | 253,950 | (l) | 84,650 | (l) | $ | 6.85 | 3/3/2025 | — | — | — | — | |||||||||||||||||||||
37,764 | — | $ | 7.71 | 6/15/2025 | — | — | — | — | ||||||||||||||||||||||||
25,654 | $ | 5.69 | 6/3/2026 | — | — | — | — | |||||||||||||||||||||||||
— | — | — | — | 104,167 | (m) | $ | 117,876 | — | — | |||||||||||||||||||||||
— | — | — | — | 221,729 | (n) | $ | 365,853 | — | — | |||||||||||||||||||||||
— | — | — | — | 166,667 | (o) | $ | 275,001 | — | — | |||||||||||||||||||||||
— | — | — | — | — | — | 126,050 | (f) | $ | 207,983 | |||||||||||||||||||||||
582,524 | (p) | $ | 961,165 | |||||||||||||||||||||||||||||
900,000 | (h) | $ | 1,485,000 | |||||||||||||||||||||||||||||
Lynn A. Feldman | 11,043 | — | $ | 5.54 | 7/7/2026 | — | — | — | — | |||||||||||||||||||||||
— | — | — | — | 20,834 | (q) | $ | 34,376 | — | — | |||||||||||||||||||||||
— | — | — | — | 44,346 | (r) | $ | 73,171 | — | — | |||||||||||||||||||||||
— | — | — | — | 41,841 | (s) | $ | 69,038 | — | — | |||||||||||||||||||||||
— | — | — | — | 87,500 | (t) | $ | 144,375 | — | — | |||||||||||||||||||||||
— | — | — | — | — | — | 66,176 | (f) | $ | 109,190 | |||||||||||||||||||||||
— | — | — | — | 339,805 | (u) | $ | 560,678 | — | ||||||||||||||||||||||||
525,000 | (h) | $ | 866,250 | |||||||||||||||||||||||||||||
Jason A. Dilger | 23,006 | — | $ | 1.51 | 8/5/2021 | — | — | — | — | |||||||||||||||||||||||
2,778 | — | $ | 4.65 | 4/10/2023 | — | — | — | — | ||||||||||||||||||||||||
2,778 | — | $ | 5.85 | 4/4/2024 | — | — | — | — | ||||||||||||||||||||||||
3,776 | — | $ | 7.71 | 6/15/2025 | — | — | — | — | ||||||||||||||||||||||||
3,078 | $ | 5.69 | 6/3/2026 | — | — | — | — | |||||||||||||||||||||||||
— | — | — | — | 9,107 | (v) | $ | 15,027 | — | — | |||||||||||||||||||||||
— | — | — | — | 18,500 | (w) | $ | 30,525 | — | — | |||||||||||||||||||||||
— | — | — | — | 18,750 | (x) | $ | 30,938 | — | — | |||||||||||||||||||||||
— | — | — | — | — | — | 14,181 | (f) | $ | 23,398 | |||||||||||||||||||||||
— | — | — | — | 97,087 | (y) | $ | 160,194 | — | — | |||||||||||||||||||||||
— | — | — | — | — | — | 150,000 | (h) | $ | 247,500 |
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Option Awards | Stock Awards | |||||||||||||||||||||||||||||||
Number of Securities Underlying Unexercised Options | Option | Option | Number of Shares or Units of Stock That | Market of Value of Shares or Unites of Stock That | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That | ||||||||||||||||||||||||||
Name | (#) Exercisable | (#) Unexercisable | Exercise Price ($) | Expiration Date | Have Not Vested (#) | Have Not Vested(a) ($) | Not Vested (#) | Have Not Vested(a) ($) | ||||||||||||||||||||||||
Scott R. Wells | 253,950 | (b) | 84,650 | (b) | 6.85 | 3/3/2025 | — | — | — | — | ||||||||||||||||||||||
37,764 | — | 7.71 | 6/15/2025 | — | — | — | — | |||||||||||||||||||||||||
25,654 | — | 5.69 | 6/3/2026 | — | — | — | — | |||||||||||||||||||||||||
— | — | — | — | 194,175 | (c) | 203,884 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 600,000 | (d) | 630,000 | ||||||||||||||||||||||||
— | — | — | — | 252,016 | (e) | 264,617 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 183,824 | (f) | 193,015 | ||||||||||||||||||||||||
— | — | — | — | 311,526 | (g) | 327,102 | — | — | ||||||||||||||||||||||||
— | — | — | — | 294,612 | (h) | 309,343 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 300,926 | (i) | 315,972 | ||||||||||||||||||||||||
Brian D. Coleman | — | — | — | — | 52,301 | (j) | 54,916 | — | — | |||||||||||||||||||||||
— | — | — | — | 161,812 | (c) | 169,903 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 500,000 | (d) | 525,000 | ||||||||||||||||||||||||
— | — | — | — | 199,933 | (e) | 209,930 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 145,833 | (f) | 153,125 | ||||||||||||||||||||||||
— | — | — | — | 168,350 | (h) | 176,768 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 138,889 | (i) | 145,833 | ||||||||||||||||||||||||
Lynn A. Feldman | 11,043 | — | 5.54 | 7/7/2026 | — | — | — | — | ||||||||||||||||||||||||
— | — | — | — | 20,921 | (j) | 21,967 | — | — | ||||||||||||||||||||||||
— | — | — | — | 113,269 | (c) | 118,932 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 350,000 | (d) | 367,500 | ||||||||||||||||||||||||
— | — | — | — | 154,570 | (e) | 162,299 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 112,745 | (f) | 118,382 | ||||||||||||||||||||||||
— | — | — | — | 107,744 | (h) | 113,131 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 88,889 | (i) | 93,333 | ||||||||||||||||||||||||
Jason A. Dilger | 2,778 | — | 4.65 | 4/10/2023 | — | — | — | — | ||||||||||||||||||||||||
2,778 | — | 5.85 | 4/4/2024 | — | — | — | — | |||||||||||||||||||||||||
3,776 | — | 7.71 | 6/15/2025 | — | — | — | — | |||||||||||||||||||||||||
3,078 | — | 5.69 | 6/3/2026 | — | — | — | — | |||||||||||||||||||||||||
— | — | — | — | 32,363 | (c) | 33,981 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 100,000 | (d) | 105,000 | ||||||||||||||||||||||||
— | — | — | — | 51,747 | (e) | 54,334 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 37,745 | (f) | 39,632 | ||||||||||||||||||||||||
— | — | — | — | 49,242 | (h) | 51,704 | — | — | ||||||||||||||||||||||||
— | — | — | — | — | — | 33,102 | (i) | 34,757 |
(a) | Market value is based upon the closing sale price of Clear Channel Outdoor common stock on December 31, |
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52 Notice and Proxy Statement 2023 |
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(h) | The outstanding RSUs, which were granted on May 4, 2022, will vest in three equal installments on April 1, 2023, April 1, 2024, and April 1, 2025. |
(i) | The PSUs granted on |
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OPTION EXERCISES AND STOCK VESTED
The following table sets forth certain information concerning option exercises by and stock vesting for the named executive officersNEOs during the year ended December 31, 2020.2022.
Option Exercises and Stock Vested During 20202022
Option Awards | Stock Awards | Option Awards | Stock Awards | |||||||||||||||||||||||||||||
Name | Number of Shares Acquired on Exercise(a) (#) | Value Realized on Exercise(b) ($) | Number of Shares Acquired on Vesting(c) (#) | Value Realized on Vesting(d) ($) | Number of Shares Acquired on Exercise(a) (#) | Value Realized on Exercise(b) ($) | Number of Shares Acquired on Vesting(c) (#) | Value Realized on Vesting(d) ($) | ||||||||||||||||||||||||
C. William Eccleshare | 22,500 | 33,019 | 216,609 | 240,889 | ||||||||||||||||||||||||||||
Scott R. Wells | — | — | 776,061 | $ | 2,281,765 | |||||||||||||||||||||||||||
Brian D. Coleman | 56,250 | 33,913 | — | — | 546,963 | 1,644,300 | ||||||||||||||||||||||||||
Scott R. Wells | 228,617 | 219,072 | ||||||||||||||||||||||||||||||
Lynn A. Feldman | 81,305 | 67,553 | — | — | 414,776 | 1,242,455 | ||||||||||||||||||||||||||
Jason A. Dilger | 23,415 | 21,737 | — | — | 106,298 | 327,815 |
(a) | Represents the gross number of shares acquired upon exercise of vested options, without taking into account any shares withheld to cover the option exercise price or applicable tax obligations. |
(b) | Represents the value of the exercised options, calculated by multiplying (1) the number of shares to which the option exercise related by (2) the difference between the actual market price of our common stock at the time of exercise and the option exercise price. |
(c) | Represents the gross number of shares acquired on vesting of restricted shares or RSUs, without taking into account any shares withheld to satisfy applicable tax obligations. |
(d) | Represents the value of the vested restricted shares or RSUs calculated by multiplying (1) the number of vested restricted shares or restricted stock units by (2) the closing price on the vesting date. |
Clear Channel Outdoor does not sponsor any pension plans in which the named executive officersNEOs participate.
NONQUALIFIED DEFERRED COMPENSATION PLANS
Clear Channel Outdoor does not sponsor any non-qualified deferred compensation plans in which the named executive officersNEOs participate.
POTENTIAL POST-EMPLOYMENT PAYMENTS
The following narrative and table describe the potential payments or benefits upon termination, change in control or other post-employment scenarios for Messrs. Eccleshare,Wells, Coleman Wells and Dilger, and Ms. Feldman using an assumed December 31, 20202022 trigger event for each scenario.
C. William EccleshareScott R. Wells
Termination due to Death. If Mr. Eccleshare’s employment is terminated by his death, Clear Channel Outdoor will pay/provide to his designee or, if no person is designated, to Mr. Eccleshare’s estate: (i) his unpaid base salary, if any, that was earned through the termination date but not otherwise previously paid (“Accrued Base Salary”), (ii) the annual bonus and bonus under the SIP, if any (the “Additional Bonus”), that Mr. Eccleshare earned with respect to the calendar year prior to the calendar year that includes the termination date (to the extent not paid as of the date of termination), which shall be paid at the time such annual bonus or Additional Bonus is payable in accordance with the employment agreement (the “Unpaid Prior Year Bonus”), (iii) a pro-rata portion, if any, of the annual bonus for the calendar year that includes the termination date (calculated based upon performance as of the termination date as related to overall performance at the end of the calendar year and payable only if an annual bonus would have otherwise been earned for such calendar year had Mr. Eccleshare remained employed until the end of such calendar year), to be paid at the time such annual bonus would otherwise be required to be paid in accordance with the employment agreement (the ”Pro-Rata Bonus”), (iv) any unreimbursed business expenses and any payments or benefits required to be paid or provided under applicable employee benefit plans or equity plans, which shall be paid or provided in accordance with the terms of such plans and/or policies (the “Accrued Obligations”) and (v) accelerated vesting with respect to any portion of his 2019 equity award that is not vested as of the termination date, which accelerated vesting shall occur on the termination date (the “2019 Equity Award Acceleration”).
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Termination due to Disability. If Mr. Eccleshare is unable to perform the essential functions of his full-time position for more than 180 consecutive days in any 12-month period, Clear Channel Outdoor may terminate his employment. If Mr. Eccleshare’s employment is terminated due to disability, Clear Channel Outdoor will pay to Mr. Eccleshare, or, in the event of Mr. Eccleshare’s legal incapacity, to the individual who holds a power of attorney on behalf of Mr. Eccleshare, any Accrued Base Salary and Accrued Obligations. In addition, if Mr. Eccleshare or his attorney in fact signs a settlement and release agreement (a “Release”), which will include terms reasonably acceptable to Clear Channel Outdoor and Mr. Eccleshare (provided that, for the avoidance of doubt, such Release will include a release by Mr. Eccleshare of claims against Clear Channel Outdoor), then Clear Channel Outdoor will pay/provide to Mr. Eccleshare or the attorney in fact any Unpaid Prior Year Bonus, any Pro-Rata Bonus and the 2019 Equity Award Acceleration, such payments or benefits to be made in accordance with the terms of the Release.
Termination by Clear Channel Outdoor for Cause. If Clear Channel Outdoor terminates Mr. Eccleshare’s employment for Cause, Clear Channel Outdoor will pay to Mr. Eccleshare any Accrued Base Salary and any Accrued Obligations.
Termination by Clear Channel Outdoor without Cause / Termination by Mr. Eccleshare for Good Cause / Failure of Clear Channel Outdoor to offer to extend the employment period. Mr. Eccleshare’s employment may be terminated at any time by Clear Channel Outdoor without Cause by giving Mr. Eccleshare not less than six (6) months prior written notice. If Clear Channel Outdoor terminates Mr. Eccleshare’s employment without Cause, if Mr. Eccleshare terminates employment for Good Cause or if Clear Channel Outdoor fails to offer to extend the employment period, Clear Channel Outdoor will pay/provide to Mr. Eccleshare: (i) any Accrued Base Salary, (ii) any Accrued Obligations and (iii) any amount due during any notice period, garden leave or suspension period. In addition, if Mr. Eccleshare signs the Release, and subject to Mr. Eccleshare’s compliance with his non-competition and non-solicitation agreements, Clear Channel Outdoor will also pay/provide to Mr. Eccleshare: (A) any Unpaid Prior Year Bonus, (B) any Pro-Rata Bonus, (C) the 2019 Equity Award Acceleration and (D) payment of an aggregate amount equal to Mr. Eccleshare’s Base Salary, multiplied by 2.3, and reduced by the total amount of remuneration previously paid to Mr. Eccleshare during any notice period, garden leave or suspension period, which aggregate amount shall be paid in equal installments in accordance with Clear Channel Outdoor’s normal payroll practices for a period of twelve (12) months following the date of such termination (the amounts in (D), the “Continued Salary Payments”), such payments to be made in accordance with the terms of such Release.
Termination by Mr. Eccleshare Without Good Cause / Failure of Mr. Eccleshare to Accept Extension of the Employment Period. Mr. Eccleshare’s employment may be terminated at any time by Mr. Eccleshare without Good Cause by giving the Board not less than ninety (90) days prior written notice. In the event that Mr. Eccleshare terminates employment without Good Cause or Mr. Eccleshare fails to affirmatively accept in writing Clear Channel Outdoor’s extension of the employment period within thirty (30) days after when such extension is offered by Clear Channel Outdoor to him, Clear Channel Outdoor shall pay Mr. Eccleshare any Accrued Base Salary, any Accrued Obligations and, only if Clear Channel Outdoor provides notice of a garden leave or payment in lieu of notice after Mr. Eccleshare has provided notice of termination without Good Cause, any amount due during any garden leave or notice period. Mr. Eccleshare may be required to repay to Clear Channel Outdoor the Second Retention Bonus Payment, and any portion of the 2019 Equity Award Grant that is not vested as of the termination date shall be forfeited on the date of termination.
If Mr. Eccleshare is in breach of his post-employment obligations or covenants, then Mr. Eccleshare will forfeit any right to the pro-rata portion of his continued salary payments described above.
Under the agreement, “Cause” means one or more of the following reasons, as determined by the Board reasonably and in good faith: (i) conduct by Mr. Eccleshare constituting a material act of willful misconduct in connection with the performance of his duties; (ii) continued, willful and deliberate non-performance by Mr. Eccleshare of his duties hereunder (other than by reason of Mr. Eccleshare’s physical or mental illness, incapacity or disability) where such non-performance has continued for more than fifteen (15) business days following written notice of such non-performance; (iii) Mr. Eccleshare’s refusal or failure to follow lawful and reasonable directives consistent with Mr. Eccleshare’s job responsibilities where such refusal or failure has continued for more than fifteen (15) business days following written notice of such refusal or failure; (iv) a criminal conviction of, or a plea of nolo contendere by, Mr. Eccleshare for a felony or material violation of any securities law, including, without limitation, conviction of fraud, theft, or embezzlement or a crime involving moral turpitude; (v) a material breach by Mr. Eccleshare of any of the provisions of the agreement or (vi) a material violation by Mr. Eccleshare of Clear Channel Outdoor’s employment policies regarding harassment.
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Under the agreement, “Good Cause” means (i) a change in Mr. Eccleshare’s reporting line; (ii) a material change in Mr. Eccleshare’s titles, duties or authorities; (iii) a reduction in Mr. Eccleshare’s Base Salary or target annual bonus, other than an across-the-board reduction applicable to all senior executive officers of Clear Channel Outdoor; (iv) a required relocation of more than fifty (50) miles of Mr. Eccleshare’s primary place of employment as of the effective date of the agreement; it being understood, however, that Mr. Eccleshare may be required to travel on business to other locations as may be required or desirable in connection with the performance of his duties specified in the agreement; or (v) a material breach by Clear Channel Outdoor of the terms of the agreement.
Brian D. Coleman
Termination due to Death. If Mr. Coleman’s employment is terminated by his death, Clear Channel Outdoor will pay to his designee or, if no designee, to his estate his accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, and any payments required under applicable employee benefit plans.
Termination due to Disability. If Mr. Coleman is unable to perform the essential functions of his full-time position for more than 180 days in any 12 month period, Clear Channel Outdoor may terminate his employment. If Mr. Coleman’s employment is terminated due to disability, he will receive all accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, and any payments required under applicable employee benefit plans.
Termination by Clear Channel Outdoor for Cause. If Clear Channel Outdoor terminates Mr. Coleman’s employment for Cause, Clear Channel Outdoor will pay to Mr. Coleman his accrued and unpaid base salary through the termination date and any payments required under applicable employee benefit plans.
Termination by Clear Channel Outdoor without Cause / Non-renewal by Clear Channel Outdoor / Termination by Mr. Coleman for Good Cause. If Clear Channel Outdoor terminates Mr. Coleman’s employment without Cause or does not renew the agreement, or if Mr. Coleman terminates for Good Cause, Clear Channel Outdoor will pay his accrued and unpaid base salary through the termination date, unpaid prior year bonus, if any, and any payments required under applicable employee benefit plans. In addition, if Mr. Coleman signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor, Clear Channel Outdoor will pay Mr. Coleman, in periodic payments in accordance with ordinary payroll practices and deductions, Mr. Coleman’s current base salary for twelve (12) months. Further, Mr. Coleman will be eligible for a pro-rata portion of the annual bonus, calculated based upon performance as of the termination date as related to overall performance at the end of the calendar year. Mr. Coleman is eligible only if a bonus would have been earned by the end of the calendar year. Calculation and payment of the bonus, if any, will be pursuant to the plan in effect during the termination year. Notwithstanding anything to the contrary set forth in any equity award agreements, any unvested Clear Channel Outdoor equity awards will vest in full on the date of termination.
Non-Renewal by Mr. Coleman. If Mr. Coleman gives notice of non-renewal of the agreement, Clear Channel Outdoor will pay his accrued and unpaid base salary through the termination date, and any payments required under applicable employee benefit plans. If the termination date is before the end of the then current employment period, and if Mr. Coleman signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor, then Clear Channel Outdoor will, in periodic payments in accordance with ordinary payroll practices and deductions, pay Mr. Coleman an amount equal to his pro-rata base salary through the end of the then current employment period.
If Mr. Coleman is in breach of any post-employment obligations or covenants, or if Mr. Coleman is hired or engaged in any capacity by any competitor of Clear Channel Outdoor, in Clear Channel Outdoor’s sole discretion, in any location during any severance pay period, the severance payments described above shall cease.
Under the agreement, “Cause” is defined as Mr. Coleman’s: (1) willful misconduct; (2) willful and repeated failure to perform his duties (other than due to disability); (3) willful and repeated failure to follow lawful directives; (4) felony conviction, a plea of nolo contendere to a felony by Mr. Coleman, or other conduct that has or would result in material injury to Clear Channel Outdoor; (5) a material breach of his employment agreement; or (6) a significant violation of Clear Channel Outdoor’s written employment and management policies made known to Mr. Coleman.
The term “Good Cause” includes: (1) a change in reporting lines such that Mr. Coleman no longer reports directly to our Chief Executive Officer; (2) a required relocation of Mr. Coleman’s offices to a location more than 50 miles from the San Antonio metropolitan area; (3) Clear Channel Outdoor’s continued breach of the terms of the
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agreement after being provided written notice of such breach by Mr. Coleman; (4) a substantial and unusual increase in responsibilities and authority without an offer of additional reasonable compensation as determined by Clear Channel Outdoor in light of compensation for similarly situated employees; (5) a substantial and unusual reduction in responsibilities or authority; or (6) a reduction in Mr. Coleman’s base salary or annual bonus target.
Scott R. Wells
Termination due to Death. If Mr. Wells’ employment is terminated by his death, Clear Channel Outdoor will pay to his designee or, if no designee, to his estate his accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, any business expenses incurred by Mr. Wells but not yet reimbursed and any other payments required under applicable employee benefit plans, equity plans or equity award agreements (collectively, the “Accrued Obligations”).
Notice and Proxy Statement 2023 53 |
Termination due to Disability. If Mr. Wells is unable to perform the essential functions of his full-time position for more than 180 days in any 12-month period, Clear Channel Outdoor may terminate his employment. If Mr. Wells’ employment is terminated due to disability, Clear Channel Outdoor will pay all Accrued Obligations to him.
Termination by Clear Channel Outdoor for Cause.Cause. If Mr. Wells’ employment is terminated by Clear Channel Outdoor for Cause, Clear Channel Outdoor will pay all Accrued Obligations to him.
Termination by Clear Channel Outdoor without Cause, Non-renewal by Clear Channel Outdoor or Termination by Mr. Wells for Good Reason. If Clear Channel Outdoor terminates Mr. Wells’ employment without Cause or does not renew the employment agreement, or if Mr. Wells terminates employment for Good Reason, then Clear Channel Outdoor will pay all Accrued Obligations to Mr. Wells. In addition, if Mr. Wells signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor: (i) Clear Channel Outdoor will pay Mr. Wells, in periodic payments in accordance with ordinary payroll practices and deductions, his current base salary for eighteen (18)18 months (the “Severance Payments” or “Severance Pay Period”); (ii) Mr. Wells will be eligible for a pro-rata bonus (“Pro-Rata Bonus”), calculated based upon performance as of the termination date as related to overall performance at the end of the calendar year. Mr. Wells will receive such Pro-Rata Bonus only if Mr. Wells would have earned the bonus had Mr. Wells remained employed through the end of the applicable calendar year. Calculation and payment of the bonus, if any, shall be pursuant to the plan in effect during the termination year; (iii) Clear Channel Outdoor will pay Mr. Wells a separation bonus in an amount equal to the target bonus to which Mr. Wells would be entitled for the year in which his employment terminates, payable in a lump sum; (iv) Clear Channel Outdoor will pay Mr. Wells in a lump sum an amount equal to the product of (A) twelve (12)18 and (B) the COBRA premiums Mr. Wells would be required to pay if he elected pursuant to COBRA to continue the health benefits coverage he had prior to the termination date (less the amount that Mr. Wells would have to pay for such coverage as an active employee) (the “COBRA Payment”), less applicable federal and state withholdings and all other applicable deductions; and (v) any unvested time vesting equity awards scheduled to vest within the twelve (12)12 month period following the date of termination shall vest in full on the date of termination. Any unvested performance vesting options shall remain eligible to vest for the three (3) monththree-month period following the date of termination. Any unvested time-vesting equity awards scheduled to vest within 12 months following the termination date, will vest in full on the date of termination. Any outstanding and unvested RSUs that are subject to performance-based vesting will vest (i) 1/3 of the target shares are eligible to vest if the date of termination is before the date of which is two years prior to the vesting date, (ii) 2/3 of the target shares are eligible to vest if the date of termination is on or after the date which is two years prior to the vesting date but before the date which is one year prior to the vesting date and (iii) 100% of the target shares are eligible to vest if the date of termination is on or after the date which is the one year prior to the vesting date (or other applicable performance metric). The portion of the RSUs that are subject to performance-based vesting that remain outstanding and eligible to be earned at the end of the applicable performance period based on the Relative TSR Performance (or other applicable performance metric) as outlined in the applicable award agreement and, if earned, will then be distributed to Mr. Wells within 60 days.
Non-Renewal By by Mr. Wells. If Mr. Wells gives notice of non-renewal of the agreement, Clear Channel Outdoor will pay all Accrued Obligations to Mr. Wells. If the termination date is before the end of the then current employment period, then Clear Channel Outdoor will, in periodic payments in accordance with ordinary payroll practices and deductions, pay Mr. Wells an amount equal to Mr. Wells’ pro-rata base salary through the end of the then current employment period.
If Mr. Wells is in breach of any post-employment obligations or covenants, or if Mr. Wells is hired or engaged in any capacity by any competitor of Clear Channel Outdoor, in Clear Channel Outdoor’s sole discretion, in any location during any severance pay period, severance payments shall cease.
If Mr. Wells is rehired by Clear Channel Outdoor during any severance pay period, severance payments shall cease. However, if Mr. Wells’ new base salary is less than his previous base salary, Clear Channel Outdoor shall pay Mr. Wells the difference between his previous and new base salary for the remainder of the severance pay period.
Under the agreement, “Cause” is defined as Mr. Wells’: (1) willful misconduct; (2) willful refusal or repeated failure to perform his duties (other than due to disability); (3) willful refusal or repeated failure to follow lawful directives; (4) felony conviction, a plea of nolo contendere, or other criminal conduct that has or would result in material injury to Clear Channel Outdoor’s reputation; (5) a material breach of his employment agreement; or (6) a material violation of Clear Channel Outdoor’s written employment and management policies that has or would result in material injury to Clear Channel Outdoor.
54 Notice and Proxy Statement 2023 |
The term “Good Reason” includes: (1) a material reduction in Mr. Wells’ base compensation; (2) a required relocation of Mr. Wells’ residence to a location more than 35 miles from its current location; (3) a material reduction in
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duties, authority or responsibilities; (4) a requirement that Mr. Wells report to any person of lesser authority than the Chief Executive Officer of Clear Channel Outdoor;Board; or (5) a material breach by Clear Channel Outdoor of the terms of the employment agreement.
Lynn A. FeldmanBrian D. Coleman
2022 Coleman Employment Agreement
Termination due to Death. If Mr. Coleman’s employment is terminated by his death, Clear Channel Outdoor will pay to his designee or, if no designee, to his estate his accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, and any payments required under applicable employee benefit plans.
Termination due to Disability. If Mr. Coleman’s employment is terminated due to disability, he will receive all accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, and any payments required under applicable employee benefit plans.
Termination by Clear Channel Outdoor for Cause. If Clear Channel Outdoor terminates Mr. Coleman’s employment for Cause, Clear Channel Outdoor will pay to Mr. Coleman his accrued and unpaid base salary through the termination date and any payments required under applicable employee benefit plans.
Termination by Clear Channel Outdoor without Cause / Non-renewal by Clear Channel Outdoor / Termination by Mr. Coleman for Good Cause. If Clear Channel Outdoor terminates Mr. Coleman’s employment without Cause or does not renew the agreement, or if Mr. Coleman terminates for Good Cause, Clear Channel Outdoor will pay his accrued and unpaid base salary through the termination date, unpaid prior year bonus, if any, and any payments required under applicable employee benefit plans. In addition, if Mr. Coleman signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor, Clear Channel Outdoor will pay Mr. Coleman, in periodic payments in accordance with ordinary payroll practices and deductions, Mr. Coleman’s current base salary for 12 months. Further, Mr. Coleman will be eligible for a pro-rata portion of the annual bonus, calculated based upon performance as of the termination date as related to overall performance at the end of the calendar year. Mr. Coleman is eligible only if a bonus would have been earned by the end of the calendar year. Calculation and payment of the bonus, if any, will be pursuant to the plan in effect during the termination year. Notwithstanding anything to the contrary set forth in any equity award agreements, any unvested Clear Channel Outdoor equity awards will vest in full on the date of termination.
Non-Renewal by Mr. Coleman. If Mr. Coleman gives notice of non-renewal of the agreement, Clear Channel Outdoor will pay his accrued and unpaid base salary through the termination date, and any payments required under applicable employee benefit plans. If the termination date is before the end of the then current employment period, and if Mr. Coleman signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor, then Clear Channel Outdoor will, in periodic payments in accordance with ordinary payroll practices and deductions, pay Mr. Coleman an amount equal to his pro-rata base salary through the end of the then current employment period.
If Mr. Coleman is in breach of any post-employment obligations or covenants, or if Mr. Coleman is hired or engaged in any capacity by any competitor of Clear Channel Outdoor, in Clear Channel Outdoor’s sole discretion, in any location during any severance pay period, the severance payments described above shall cease.
If Mr. Coleman is rehired by Clear Channel Outdoor during any severance pay period, severance payments shall cease. However, if Mr. Coleman’s new base salary is less than his previous base salary, Clear Channel Outdoor shall pay Mr. Coleman the difference between his previous and new base salary for the remainder of the severance pay period.
Under the agreement, “Cause” is defined as Mr. Coleman’s: (1) willful misconduct; (2) willful and repeated failure to perform his duties (other than due to disability); (3) willful and repeated failure to follow lawful directives; (4) felony conviction, a plea of nolo contendere to a felony by Mr. Coleman, or other conduct that has or would result in material injury to Clear Channel Outdoor; (5) a material breach of his employment agreement; or (6) a significant violation of Clear Channel Outdoor’s written employment and management policies made known to Mr. Coleman.
Notice and Proxy Statement 2023 55 |
The term “Good Cause” includes: (1) a change in reporting lines such that Mr. Coleman no longer reports directly to our Chief Executive Officer; (2) a required relocation of Mr. Coleman’s offices to a location more than 50 miles from the San Antonio metropolitan area; (3) Clear Channel Outdoor’s continued breach of the terms of the agreement after being provided written notice of such breach by Mr. Coleman; (4) a substantial and unusual increase in responsibilities and authority without an offer of additional reasonable compensation as determined by Clear Channel Outdoor in light of compensation for similarly situated employees; (5) a substantial and unusual reduction in responsibilities or authority; or (6) a reduction in Mr. Coleman’s base salary or annual bonus target.
Coleman Amended and Restated Employment Agreement
Pursuant to the Coleman Amended and Restated Employment Agreement, if Clear Channel Outdoor terminates Mr. Coleman’s employment without Cause or does not renew the agreement, or if Mr. Coleman terminates for Good Cause (each as defined therein), Clear Channel Outdoor will pay his accrued and unpaid base salary through the termination date, unpaid prior year bonus, if any, and any payments required under applicable employee benefit plans. In addition, if Mr. Coleman signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor, Clear Channel Outdoor will pay Mr. Coleman, in periodic payments in accordance with ordinary payroll practices and deductions, Mr. Coleman’s current base salary for 12 months. Further, Mr. Coleman will be eligible for a pro-rata portion of the annual bonus, calculated based upon actual performance and pro-rated to reflect Mr. Coleman’s period of employment during the performance period through the date of termination. Calculation and payment of the bonus, if any, will be pursuant to the plan in effect during the termination year. Notwithstanding anything to the contrary set forth in any equity award agreements between the Company and Mr. Coleman (except in circumstances where treatment more favorable to Mr. Coleman is provided in any such equity award agreement), (x) any unvested Clear Channel Outdoor equity awards granted prior to the effective date of the Coleman Amended and Restated Employment Agreement (the “Effective Date”) will vest in full on the date of termination; (y) any unvested time-vesting equity awards granted after the Effective Date which are scheduled to vest within the 12 month period following the date of termination will vest in full on the date of termination; and (z) any outstanding and unvested performance stock units granted after the Effective Date will vest as follows: (i) one-third of the target number of shares underlying the performance stock units are eligible to vest if the date of termination is before the date which is two years prior to the vesting date (as defined in the applicable award agreement), (ii) two-thirds of the target number of shares underlying the performance stock units are eligible to vest if the date of termination is on or after the date which is two years prior to the vesting date but before the date which is one year prior to the vesting date, and (iii) one hundred percent of the target number of shares underlying the performance stock units are eligible to vest if the date of termination is on or after the date which is one year prior to the vesting date. The portion of the performance stock units eligible to vest will remain outstanding and eligible to be earned at the end of the applicable performance period based on the relative total shareholder return performance (or other applicable performance metric) as outlined in the applicable award agreement and, if earned, will then be distributed to Mr. Coleman within 60 days.
The other terms of the Coleman Amended and Restated Employment Agreement are substantially similar to those of the 2022 Coleman Employment Agreement.
Lynn A. Feldman
Termination due to Death. If Ms. Feldman’s employment is terminated by herdue to death, Clear Channel Outdoor will pay to her designee or, if no designee, to her estate her accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, any business expenses incurred by Ms. Feldman but not yet reimbursed and any other payments required under applicable employee benefit plans.plans, equity plans or equity award agreements (collectively, the “Accrued Obligations”).
Termination due to Disability. If Ms. Feldman is unable to perform the essential functions of her full-time position for more than 180 days in any 12 month period, Clear Channel Outdoor may terminate her employment. If Ms. Feldman’s employment is terminated due to disability, sheClear Channel Outdoor will receivepay all accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, and any payments required under applicable employee benefit plans.Accrued Obligations to her.
Termination by Clear Channel Outdoor for Cause. If Clear Channel Outdoor terminates Ms. Feldman’s employment for Cause, Clear Channel Outdoor will pay to Ms. Feldman her accrued and unpaid base salary through the termination date and any payments required under applicable employee benefit plans.
56 Notice and Proxy Statement 2023 |
Termination by Clear Channel Outdoor without Cause / Non-renewal by Clear Channel Outdoor / Termination by Ms. Feldman for Good Cause. If Clear Channel Outdoor terminates Ms. Feldman’s employment without Cause or does not renew the agreement, or if Ms. Feldman terminates for Good Cause, Clear Channel Outdoor will pay her accrued and unpaid base salary through the termination date, unpaid prior year bonus, if any, and any payments required under applicable employee benefit plans. If Clear Channel Outdoor does not renew the agreement, Clear Channel Outdoor will pay her accrued and unpaid base salary through the end of the employment period, unpaid prior year bonus, if any, and any payments required under applicable employee benefit plans.Accrued Obligations. In addition, if Ms. Feldman signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor, Clear Channel Outdoor will pay Ms. Feldman, in periodic payments in accordance with ordinary payroll practices and deductions, Ms. Feldman’s current base salary for twelve (12)12 months. Further, Ms. Feldman will be eligible for a pro-rata portion of the annual bonus, calculated based upon performance as of the termination date as related to overall performance at the end of the calendar year. Ms. Feldman is eligible only if a bonus would have been earned by the end of the calendar year. Calculation and payment of the bonus, if any, will be pursuant to the plan in effect during the termination year. Any unvested time-vesting equity awards scheduled to vest within 12 months following the termination date will vest in full on the date of termination. Any outstanding and unvested RSUs that are subject to performance-based vesting will vest (i) 1/3 of the target shares are eligible to vest if the date of termination is before the date of which is two years prior to the vesting date, (ii) 2/3 of the target shares are eligible to vest if the date of termination is on or after the date which is two years prior to the vesting date but before the date which is one year prior to the vesting date and (iii) 100% of the target shares are eligible to vest if the date of termination is on or after the date which is the one year prior to the vesting date (or other applicable performance metric). The portion of the RSUs that are subject to performance-based vesting that remain outstanding and eligible to be earned at the end of the applicable performance period based on the Relative TSR Performance (or other applicable performance metric) as outlined in the applicable award agreement and, if earned, will then be distributed to Ms. Feldman within 60 days.
Non-Renewal by Ms. Feldman. If Ms. Feldman gives notice of non-renewal of the agreement in accordance with the terms of the agreement, Clear Channel Outdoor will pay her accrued and unpaid base salary through the end of the then current employment period, unpaid prior year bonus, if any, and any payments required under applicable employee benefit plans.Accrued Obligations.
If Ms. Feldman is in breach of any post-employment obligations or covenants, or if Ms. Feldman is hired or engaged in any capacity by any competitor of Clear Channel Outdoor, in Clear Channel Outdoor’s sole discretion, in any location during any severance pay period, the severance payments described above shall cease.
If Ms. Feldman is rehired by Clear Channel Outdoor during any severance pay period, severance payments shall cease. However, if Ms. Feldman’s new base salary is less than her previous base salary, Clear Channel Outdoor shall pay Ms. Feldman the difference between her previous and new base salary for the remainder of the severance pay period.
Under the agreement, “Cause” is defined as Ms. Feldman’s: (1) willful misconduct; (2) material non-performance of her duties (other than due to disability); (3) repeated failure to follow lawful directives; (4) felony conviction, a plea of nolo contendere to a felony by Ms. Feldman, or other conduct that has or would result in material injury to Clear Channel Outdoor’s reputation; (5) a material breach of her employment agreement; or (6) a significantmaterial violation of Clear Channel Outdoor’s written employment and management policies.
The term “Good Cause” includes: (1) a material and substantial diminution of duties or responsibilities or Ms. Feldman’s removal as Executive Vice President and/or General Counsel;general counsel; (2) a required relocation of Ms. Feldman’s principal place of work to a location more than 30 miles from Ms. Feldman’sthe current location in New York, NY;New York; or (3) a significant reduction in Ms. Feldman’s base salary or annual bonus target.
Jason A. Dilger
Termination due to Death. If Mr. Dilger’s employment is terminated by his death, Clear Channel Outdoor will pay to his designee or, if no designee, to his estate his accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, and any payments required under applicable employee benefit plans.
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Termination due to Disability. If Mr. Dilger is unable to perform the essential functions of his full-time position for more than 180 days in any 12 month period, Clear Channel Outdoor may terminate his employment. If Mr. Dilger’s employment is terminated due to disability, he will receive all accrued and unpaid base salary and any unpaid prior year bonus, if any, through the date of termination, and any payments required under applicable employee benefit plans.
Termination by Clear Channel Outdoor for Cause. If Clear Channel Outdoor terminates Mr. Dilger’s employment for Cause, Clear Channel Outdoor will pay to Mr. Dilger his accrued and unpaid base salary through the termination date and any payments required under applicable employee benefit plans.
Notice and Proxy Statement 2023 57 |
Termination by Clear Channel Outdoor without Cause / Non-renewal by Clear Channel Outdoor. If Clear Channel Outdoor terminates Mr. Dilger’s employment without Cause or does not renew the agreement, Clear Channel Outdoor will pay his accrued and unpaid base salary through the termination date, unpaid prior year bonus, if any, and any payments required under applicable employee benefit plans. In addition, if Mr. Dilger signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor, Clear Channel Outdoor will pay Mr. Dilger, in periodic payments in accordance with ordinary payroll practices and deductions, Mr. Dilger’s current base salary for twelve (12)12 months. Further, Mr. Dilger will be eligible for a pro-rata portion of the annual bonus, calculated based upon actual performance as of the termination date as related to overall performanceand paid at the end of the calendar year. Mr. Dilger is eligible only if a bonus would have been earned by the end of the calendar year.time annual bonuses are paid to other Clear Channel Outdoor employees. Calculation and payment of the bonus, if any, will be pursuant to the plan in effect during the termination year.
Non-Renewal by Mr. Dilger. If Mr. Dilger gives notice of non-renewal of the agreement, Clear Channel Outdoor will pay his accrued and unpaid base salary through the termination date, and any payments required under applicable employee benefit plans. If the termination date is before the end of the then current employment period, and if Mr. Dilger signs a severance agreement and general release of claims in a form satisfactory to Clear Channel Outdoor, then Clear Channel Outdoor will, in periodic payments in accordance with ordinary payroll practices and deductions, pay Mr. Dilger an amount equal to his pro-rata base salary through the end of the then currentthen-current employment period.
If Mr. Dilger is in breach of any post-employment obligations or covenants, or if Mr. Dilger is hired or engaged in any capacity by any competitor of Clear Channel Outdoor, in Clear Channel Outdoor’s sole discretion, in any location during any severance pay period, the severance payments described above shall cease.
If Mr. Dilger is rehired by Clear Channel Outdoor during any severance pay period, severance payments shall cease; however, if Mr. Dilger’s base salary following such rehiring is less than his base salary in effect immediately prior to his termination, Clear Channel Outdoor shall pay Mr. Dilger, for the remainder of the severance pay period, the pro-rata difference between his base salary as in effect immediately prior to the termination and his salary following such rehiring.
Under the agreement, “Cause” is defined as Mr. Dilger’s: (1) willful misconduct; (2) non-performance of duties (other than due to disability); (3) failure to follow lawful directives; (4) felony conviction, a plea of nolo contendere to a felony by Mr. Dilger, or other conduct that has or would result in material injury to Clear Channel Outdoor’s reputation; (5) a material breach of his employment agreement; or (6) a significant violation of Clear Channel Outdoor’s written employment and management policies.
Equity Award Treatment
Pursuant to the terms of the 2021 Plan and applicable award agreements, if an NEO’s employment terminates due to death or disability, then unvested RSUs and PSUs will vest in full (with such vesting to be at the target level with respect to PSUs), and unvested restricted stock awards will be forfeited for no consideration. If an NEO’s employment terminates due to Retirement (as defined in the applicable award agreement), with respect to then unvested RSUs and PSUs, the NEO will vest in the portion of the award that would have vested in the ordinary course during the 12-month period following such Retirement (with such pro rata portion to be at the target level with respect to PSUs), and then unvested restricted stock awards will be forfeited for no consideration.
Upon a Change in Control (as defined in the applicable award agreement), the Compensation Committee may elect to (i) accelerate the vesting of all or a portion of the award, (ii) cancel the award and pay the NEO an amount of cash, shares of stock or combination thereof equal to the Change in Control Price (as defined in the applicable award agreement) for a number of shares equal to the vested RSUs or target number of PSUs, (iii) provide for the assumption, substitution or continuation of RSUs or PSUs by the successor company or a parent or subsidiary of the successor company, (v) with respect to PSUs, certify the extent to which the performance conditions have been achieved prior to the conclusion of the performance period, with such PSUs to remain subject to time-based vesting conditions through the conclusion of the performance period, or (v) make such adjustments to the RSUs or PSUs then outstanding as the Compensation Committee deems appropriate to reflect such Change in Control; provided, however, the Compensation Committee may determine that no adjustment is necessary.
In the event that an NEO is terminated by the Company without Cause (as defined in the applicable award agreement) within 12 months following a Change in Control, then 100% of then unvested RSUs and restricted stock awards will vest and then unvested PSUs will vest at target level.
58 Notice and Proxy Statement 2023 |
Post-Employment Table
The following table describes the potential payments or benefits upon termination, other post-employment scenarios or change in control for each of those named executive officers.NEOs. The amounts in the table below show only the value of amounts payable or benefits due to enhancements in connection with each scenario, and do not reflect amounts otherwise payable or benefits otherwise due as a result of employment. In addition, the table does not include amounts payable pursuant to plans that are available generally to all salaried employees. The actual amounts to be paid out can only be determined at the time of such change in control or such executive officer’s termination of service.
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Potential Payments Upon Termination or Change in Control(a)
Name | Benefit | Termination with “Cause” | Termination without “Cause” or Resignation for “Good Cause” or “Good Reason” | Termination due to “Disability” | Termination due to Death | Retirement or Resignation without “Good Cause” or “Good Reason” | “Change in Control” without Termination(b) | “Change in Control” with Termination | Benefit | Termination without “Cause” or Resignation for “Good Reason” | Termination due to “Disability” | Termination due to Death | Retirement or Resignation without “Good Reason” | “Change in Control” without Termination(b) | “Change in Control” with Termination | |||||||||||||||||||||||||||||||||||||||||
C. William | Cash payment | $ | — | $ | 3,493,750 | (c) | $ | 618,750 | (d) | $ | 618,750 | (d) | $ | 308,219 | (e) | $ | — | $ | 3,493,750 | (c) | ||||||||||||||||||||||||||||||||||||
Scott R. Wells | Cash payment | $ | 4,282,842 | (c) | $ | — | $ | — | $ | — | $ | — | $ | 4,282,842 | (c) | |||||||||||||||||||||||||||||||||||||||||
Cash Value of Benefits(d) | $ | 15,142 | $ | — | $ | — | $ | — | $ | — | $ | 15,142 | ||||||||||||||||||||||||||||||||||||||||||||
Vesting of equity awards(f) | — | 161,448 | 3,464,112 | 3,829,965 | 572,360 | 3,829,965 | Vesting of equity awards(e) | $ | 1,646,342 | $ | 2,752,919 | $ | 2,752,919 | $ | — | $ | — | 2,752,919 | ||||||||||||||||||||||||||||||||||||||
TOTAL | $ | — | $ | 3,655,198 | $ | 4,082,862 | $ | 4,448,715 | $ | 880,579 | $ | $ | 7,323,715 | TOTAL | $ | 5,944,326 | $ | 2,752,919 | $ | 2,752,919 | $ | — | $ | — | 7,050,903 | |||||||||||||||||||||||||||||||
Brian D. | Cash payment | $ | — | $ | 942,500 | (g) | $ | — | $ | — | $ | — | $ | — | $ | 942,500 | (g) | Cash payment | $ | 1,414,336 | (f) | $ | — | $ | — | $ | — | $ | — | 1,414,336 | (f) | |||||||||||||||||||||||||
Vesting of equity awards(f) | — | $ | 2,264,965 | 2,092,372 | 2,092,372 | — | — | 2,264,965 | ||||||||||||||||||||||||||||||||||||||||||||||||
TOTAL | $ | — | $ | 3,947,465 | $ | 2,092,372 | $ | 2,092,372 | $ | — | $ | — | $ | 3,207,465 | ||||||||||||||||||||||||||||||||||||||||||
Scott R. Wells | Cash payment | $ | — | $ | 2,655,000 | (h) | $ | — | $ | — | $ | — | $ | — | $ | 2,655,000 | (h) | |||||||||||||||||||||||||||||||||||||||
Cash value of benefits(i) | — | 10,210 | — | — | — | — | 10,210 | |||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of equity awards(f) | — | 812,688 | 2,642,130 | 2,642,130 | — | — | 3,179,859 | Vesting of equity awards(e) | $ | 1,734,431 | $ | 1,679,515 | $ | 1,679,515 | $ | — | $ | — | 1,734,431 | |||||||||||||||||||||||||||||||||||||
TOTAL | $ | — | $ | 3,477,898 | $ | 2,642,130 | $ | 2,642,130 | $ | — | $ | — | $ | 5,845,069 | TOTAL | $ | 3,148,767 | $ | 1,679,515 | $ | 1,679,515 | $ | — | $ | — | 3,148,767 | ||||||||||||||||||||||||||||||
Lynn A. Feldman | Cash payment | $ | — | $ | 870,000 | (g) | $ | — | $ | — | $ | — | $ | — | $ | 870,000 | (g) | Cash payment | $ | 1,369,649 | (f) | $ | — | $ | — | $ | — | $ | — | 1,369,649 | (f) | |||||||||||||||||||||||||
Vesting of equity awards(f) | — | — | 1,500,934 | 1,500,934 | — | — | 1,677,519 | Vesting of equity awards(e) | $ | 847,324 | $ | 1,185,293 | $ | 1,185,293 | $ | — | $ | — | 1,207,260 | |||||||||||||||||||||||||||||||||||||
TOTAL | $ | — | $ | 870,000 | $ | 1,500,934 | $ | 1,500,934 | $ | — | $ | 2,547,519 | TOTAL | $ | 2,216,973 | $ | 1,185,293 | $ | 1,185,293 | $ | — | $ | — | 2,576,909 | ||||||||||||||||||||||||||||||||
Jason A. Dilger | Cash payment | $ | — | $ | 469,900 | (g) | $ | — | $ | — | $ | — | $ | — | $ | 469,900 | (g) | Cash payment | $ | 676,706 | (f) | $ | — | $ | — | $ | — | $ | — | 676,706 | (f) | |||||||||||||||||||||||||
Vesting of equity awards(f) | — | — | 402,927 | 402,927 | — | — | 448,478 | Vesting of equity awards(e) | $ | — | $ | 393,797 | $ | 393,797 | $ | — | $ | — | 393,797 | |||||||||||||||||||||||||||||||||||||
TOTAL | $ | — | $ | 469,900 | $ | 402,927 | $ | 402,927 | $ | — | $ | — | $ | 918,378 | TOTAL | $ | 676,706 | $ | 393,797 | $ | 393,797 | $ | — | $ | — | 1,070,503 | ||||||||||||||||||||||||||||||
(a) | Amounts reflected in the table were calculated assuming the triggering event occurred on December 31, |
(b) | Amounts reflected in the “Change in Control without Termination” column were calculated assuming that no termination occurred after the change in control. The values of any additional benefits to the |
(c) | Represents the sum of (1) |
(d) |
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(e) |
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Amounts reflect the value of unvested Clear Channel Outdoor equity awards held by the respective |
Represents the sum of (1) 1.0 times the |
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Notice and Proxy Statement 2023 59 |
Year | Summary Compensation Table Total for PEO (a) | Compensation Actually Paid to PEO (a)(b) | Average Summary Compensation Table Total for Non-PEO Named Executive Officers (c) | Average Compensation Actually Paid to Non-PEO Named Executive Officers (b)(c) | Value of Initial Fixed $100 Investment Based On: | Net Income (e) | CCOH Plan Adjusted EBITDA (f) | |||||||||||||||||||||||
Total Shareholder Return (d) | Peer Group Total Shareholder Return (d) | |||||||||||||||||||||||||||||
2022 | $5,962,621 | ($ | 1,048,564 | ) (g) | $ | 1,895,137 | ($ | 1,099,639 | ) (g) | $ | 37 | $ | 93 | ($ | 94,388,000 | ) | $ | 632,587,236 | ||||||||||||
2021 | $6,234,771 | $ | 11,854,376 | (h) | $ | 2,880,092 | $ | 5,492,876 | (h) | $ | 116 | $ | 107 | ($ | 433,120,000 | ) | $ | 496,603,373 | ||||||||||||
2020 | $4,537,958 | $ | 4,047,663 | (i) | $ | 1,676,961 | $ | 1,528,992 | (i) | $ | 58 | $ | 95 | ($ | 600,226,000 | ) | $ | 162,508,046 |
(a) | The names of the PEO of the Company reflected in these columns for each applicable fiscal year are as follows: (i) for fiscal year 2022, Mr. Wells, and (ii) for fiscal years 2021 and 2020, Mr. Eccleshare. |
(b) | In calculating the ‘compensation actually paid’ amounts reflected in these columns, the fair value or change in fair value, as applicable, of the equity award adjustments included in such calculations was computed in accordance with FASB ASC Topic 718. The following valuation assumptions used to calculate such fair values did, in some cases, materially differ from those disclosed at the time of grant : |
Measurement Year | 2022 | 2021 | 2020 | |||
Risk Free Rate (1) | 4.37% - 4.64% | 0.06% - 0.79% | 0.11% - 0.13% | |||
Dividend Yield (2) | 0% | 0% | 0% | |||
Volatility (3) | 77.3% | 67.5% | 62.3% | |||
Correlation (4) | 34.3% - 35.2% | 33.3% - 34.0% | 32.8% - 33.4% | |||
TSR performance to date (5) | -66.2% - 2.3% | 34.0% - 222.4% | -32.5% - 60.7% | |||
Stock Price (6) | $1.05 | $3.31 | $1.65 |
1. | Risk-free interest rate assumptions are based on U.S. Treasury constant maturities yields as of each measurement date with a term corresponding to the remaining length of the performance period, as reported in the H.15 Federal Reserve Statistical Release. |
2. | We do not currently pay dividends. |
3. | The volatility assumptions for the Company as of December 31, 2020, December 31, 2021 and December 31, 2022 were determined based on an average of the blended five-year daily historical volatility for a set of peer companies selected by Clear Channel Outdoor. Volatility for each peer group company was calculated by blending Clear Channel Outdoor’s stock price change history since September 1, 2019 with the peer company’s stock price change history prior to September 1, 2019 for the period comprising the five-year lookback period. |
4. | Historical correlation coefficients were calculated based on share price changes over a period consistent with the volatility lookback period between each of the constituents in the peer group as of each measurement date. |
5. | Since the measurement date occurs after the beginning of the performance period, actual TSR performance between the beginning of the performance period and the measurement date (“Starting TSR”) must be reflected in the valuation for the Company and each of the constituents in the peer group as of each measurement date. |
6. | Represents the stock price as of December 31 of each applicable fiscal year. |
Grant & Measurement Date | 7/7/16 grant as of 12/31/19 | 7/7/16 grant as of 7/7/20 | 6/3/16 grant as of 12/31/19 | 6/3/16 grant as of 6/3/20 | 6/3/19 grant as of 12/31/19 | 6/3/19 grant as of 12/31/20 | 6/3/19 grant as of 12/31/21 | 3/3/15 grant (vested) as of 12/31/19 | 3/3/15 grant (vested) as of 2/3/20 | 3/3/15 grant (outstanding) as of 12/31/19 & 12/31/20 | 3/3/15 grant (outstanding) as of 12/31/21 | 3/3/15 grant (outstanding) as of 12/31/22 | ||||||||||||||||||||||||||||||||||||
Risk Free Rate (1) | 1.660 | % | 0.270 | % | 1.657 | % | 0.354 | % | 1.803 | % | 0.557 | % | 1.163 | % | N/A | 1.343 | % | N/A | 0.995 | % | 4.378 | % | ||||||||||||||||||||||||||
Dividend Yield (2) | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Volatility (3) | 32.20 | % | 40.90 | % | 32.20 | % | 39.90 | % | 32.20 | % | 58.90 | % | 63.60 | % | N/A | 32.20 | % | N/A | 63.60 | % | 72.50 | % | ||||||||||||||||||||||||||
Expected Life (4) | 4.13 | 4.59 | 4.07 | 4.57 | 6.61 | 6.36 | 4.33 | N/A | 3.67 | N/A | 3.17 | 2.17 | ||||||||||||||||||||||||||||||||||||
Strike Price (5) | $ | 5.54 | $ | 5.54 | $ | 5.69 | $ | 5.69 | $ | 5.11 | $ | 5.11 | $ | 5.11 | N/A | $ | 6.854 | N/A | $ | 6.854 | $ | 6.854 | ||||||||||||||||||||||||||
Measurement Date Stock Price (6) | $ | 2.86 | $ | 0.93 | $ | 2.86 | $ | 0.99 | $ | 2.86 | $ | 1.65 | $ | 3.31 | N/A | $ | 2.78 | N/A | $ | 3.31 | $ | 1.05 |
60 Notice and Proxy Statement |
1. | Risk-free interest rate assumptions are based on U.S. Treasury constant maturities yields as of the grant date with a term corresponding to the option’s expected term. |
2. | We do not currently pay dividends. |
3. | The volatility assumption was determined as follows: |
4. | The expected life assumption is based on the Expected Life assumption used in the grant date valuation that precedes the respective Measurement Date (baseline assumption) with the following adjustments: |
5. | The price at which shares of stock may be purchased by the employee upon exercise of the options. |
6. | Closing stock price on the Measurement Date. |
(c) | The names of each non-PEO NEO reflected in these columns for each applicable fiscal year are as follows: (i) for fiscal year 2022, Messrs. Coleman and Dilger and Ms. Feldman; and (ii) for fiscal years 2021 and 2020, Messrs. Wells, Coleman and Dilger and Ms. Feldman. |
(d) | The Company’s TSR and the Company’s peer group TSR reflected in these columns for each applicable fiscal year is calculated based on a fixed investment of $100 at the applicable measurement point on the same cumulative basis as is used in Item 201(e) of Regulation S-K. The peer group used to determine the Company’s peer group TSR for each applicable fiscal year is the same peer group that was used for purposes of disclosing our executive compensation benchmarking practices, as described in the section titled “Role of the Executive Compensation Peer Group.” |
(e) | Represents the amount of net income (loss) reflected in the Company’s audited financial statements for each applicable fiscal year. |
(f) | We have selected CCOH Plan Adjusted EBITDA as our most important financial measure (that is not otherwise required to be disclosed in the table) used to link ‘compensation actually paid’ to our NEOs to company performance for fiscal year 2022. CCOH Plan Adjusted EBITDA is the adjusted EBITDA amount used for executive bonus calculations, which excludes bonus expense. Below is a reconciliation of CCOH Plan Adjusted EBITDA for fiscal years 2020, 2021 and 2022 to net loss. |
(in thousands) | 2022 | 2021 | 2020 | |||||||||
Consolidated net loss | $ | (94,388 | ) | $ | (433,120 | ) | $ | (600,226 | ) | |||
Income tax expense (benefit) | $ | (71,832 | ) | $ | (34,528 | ) | $ | (58,006 | ) | |||
Other expense (income), net | $ | 35,079 | $ | (1,762 | ) | $ | 170 | |||||
Loss on extinguishment of debt | $ | — | $ | 102,757 | $ | 5,389 | ||||||
Interest expense, net | $ | 362,680 | $ | 350,457 | $ | 360,259 | ||||||
Other operating expense (income), net | $ | 2,386 | $ | (627) | $ | (53,614 | ) | |||||
Impairment charges | $ | 39,546 | $ | 118,950 | $ | 150,400 | ||||||
Depreciation & amortization | $ | 253,809 | $ | 253,155 | $ | 269,421 | ||||||
Share-based compensation | $ | 21,148 | $ | 19,398 | $ | 13,235 | ||||||
Restructuring and other costs | $ | 16,244 | $ | 47,840 | $ | 32,942 | ||||||
Adjusted EBITDA | $ | 564,672 | $ | 422,520 | $ | 119,970 | ||||||
Bonus Expense | $ | 53,035 | $ | 65,605 | $ | 16,281 | ||||||
FX Impact / Other | $ | 14,881 | $ | 8,478 | $ | (358 | ) | |||||
Divested Businesses (add back loss) | — | — | $ | 26,615 | ||||||||
CCOH Plan Adjusted EBITDA | $ | 632,587 | $ | 496,603 | $ | 162,508 |
Notice and Proxy Statement 2023 61 |
(g) | For fiscal year 2022, the ‘compensation actually paid’ to the PEO and the average ‘compensation actually paid’ to the non-PEO NEOs reflect the following adjustments made to the total compensation amounts reported in the Summary Compensation Table for fiscal year 2022, computed in accordance with Item 402(v) of RegulationS-K: |
PEO | Average Non-PEO NEOs | |||||||
Total Compensation Reported in 2022 Summary Compensation Table | $ | 5,962,621 | $ | 1,895,137 | ||||
Less, Grant Date Fair Value of Stock & Option Awards Reported in the 2022 Summary Compensation Table | ($ | 3,350,658 | ) | ($ | 750,455 | ) | ||
Plus, Year-End Fair Value of Awards Granted in 2022 that are Outstanding and Unvested | $ | 997,556 | $ | 218,237 | ||||
Plus, Change in Fair Value of Awards Granted in Prior Years that are Outstanding and Unvested (From Prior Year-End toYear-End) | ($ | 4,762,215 | ) | ($ | 2,552,496 | ) | ||
Plus, Vesting Date Fair Value of Awards Granted in 2022 that Vested in 2022 | — | — | ||||||
Plus, Change in Fair Value of Awards Granted in Prior Years that Vested in 2022 (From Prior Year-End to Vesting Date) | $ | 104,132 | $ | 89,938 | ||||
Less, Prior Year-End Fair Value of Awards Granted in Prior Years that Failed to Vest in 2022 | — | — | ||||||
Plus, Dollar Value of Dividends or other Earnings Paid on Stock & Option Awards in 2022 prior to Vesting (if not reflected in the fair value of such award or included in Total Compensation for 2022) | — | — | ||||||
Total Adjustments | ($ | 7,011,185 | ) | ($ | 2,994,776 | ) | ||
Compensation Actually Paid for Fiscal Year 2022 | ($ | 1,048,564 | ) | ($ | 1,099,639 | ) |
(h) | For fiscal year 2021, the ‘compensation actually paid’ to the PEO and the average ‘compensation actually paid’ to the non-PEO NEOs reflect the following adjustments made to the total compensation amounts reported in the Summary Compensation Table for fiscal year 2021, computed in accordance with Item 402(v) of RegulationS-K: |
PEO | Average Non-PEO NEOs | |||||||
Total Compensation Reported in 2021 Summary Compensation Table | $ | 6,234,771 | $ | 2,880,092 | ||||
Less, Grant Date Fair Value of Stock & Option Awards Reported in the 2021 Summary Compensation Table | ($ | 1,947,577 | ) | ($ | 1,192,283 | ) | ||
Plus, Year-End Fair Value of Awards Granted in 2021 that are Outstanding and Unvested | $ | 2,899,377 | $ | 1,774,963 | ||||
Plus, Change in Fair Value of Awards Granted in Prior Years that are Outstanding and Unvested (From Prior Year-End toYear-End) | $ | 3,745,426 | $ | 1,934,018 | ||||
Plus, Vesting Date Fair Value of Awards Granted in 2021 that Vested in 2021 | — | — | ||||||
Plus, Change in Fair Value of Awards Granted in Prior Years that Vested in 2021 (From Prior Year-End to Vesting Date) | $ | 922,379 | $ | 96,086 | ||||
Less, Prior Year-End Fair Value of Awards Granted in Prior Years that Failed to Vest in 2021 | — | — | ||||||
Plus, Dollar Value of Dividends or other Earnings Paid on Stock & Option Awards in 2021 prior to Vesting (if not reflected in the fair value of such award or included in Total Compensation for 2021) | — | — | ||||||
Total Adjustments | $ | 5,619,605 | $ | 2,612,784 | ||||
Compensation Actually Paid for Fiscal Year 2021 | $ | 11,854,376 | $ | 5,492,876 |
62 Notice and Proxy Statement 2023 |
(i) | For fiscal year 2020, the ‘compensation actually paid’ to the PEO and the average ‘compensation actually paid’ to the non-PEO NEOs reflect the following adjustments made to the total compensation amounts reported in the Summary Compensation Table for fiscal year 2020, computed in accordance with Item 402(v) of RegulationS-K: |
PEO | Average Non-PEO NEOs | |||||||
Total Compensation Reported in 2020 Summary Compensation Table | $ | 4,537,958 | $ | 1,676,961 | ||||
Less, Grant Date Fair Value of Stock & Option Awards Reported in the 2020 Summary Compensation Table | ($ | 1,449,030 | ) | ($ | 748,665 | ) | ||
Plus, Year-End Fair Value of Awards Granted in 2020 that are Outstanding and Unvested | $ | 2,701,456 | $ | 1,395,640 | ||||
Plus, Change in Fair Value of Awards Granted in Prior Years that are Outstanding and Unvested (From Prior Year-End toYear-End) | ($ | 1,343,351 | ) | ($ | 603,806 | ) | ||
Plus, Vesting Date Fair Value of Awards Granted in 2020 that Vested in 2020 | — | — | ||||||
Plus, Change in Fair Value of Awards Granted in Prior Years that Vested in 2020 (From Prior Year-End to Vesting Date) | ($ | 399,370 | ) | ($ | 191,138 | ) | ||
Less, Prior Year-End Fair Value of Awards Granted in Prior Years that Failed to Vest in 2020 | — | — | ||||||
Plus, Dollar Value of Dividends or other Earnings Paid on Stock & Option Awards in 2020 prior to Vesting (if not reflected in the fair value of such award or included in Total Compensation for 2020) | — | — | ||||||
Total Adjustments | ($ | 490,295 | ) | ($ | 147,969 | ) | ||
Compensation Actually Paid for Fiscal Year 2020 | $ | 4,047,663 | $ | 1,528,992 |
Notice and Proxy Statement 2023 63 |
64 Notice and Proxy Statement 2023 |
Tabular List |
Overall CCOH Plan Adjusted EBITDA |
Segment CCOA Plan Adjusted EBITDA |
Company TSR Relative to S&P 600 |
Company Stock Price |
Notice and Proxy Statement 2023 65 |
As required by Item 402(u) of Regulation S-K, we are providing pay ratio information about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. C. William Eccleshare,Scott R. Wells, our President and Chief Executive Officer. The rules adopted by the SEC require a registrant to identify its median employee only once every three years if there has been no change to the registrant’s employee population or employee compensation arrangements that would result in a significant change to the pay ratio disclosure. Because we have had no changes to our employee population orMr. Wells became the CEO in 2022 and has been provided new compensation arrangements that would significantly impact our pay ratio disclosure, the employee representing the median-paidin connection with this appointment. As such, we selected a new median employee for 2020 is2022 from a group of employees as of December 31, 2022 whose compensation was approximately equal to the same employee selected for 2019.median employee. For 2020,2022, our last completed fiscal year:
the median of the annual total compensation of all employees of our company (other than our CEO), was $48,789;$51,937; and
the annual total compensation of our CEO, as reported in the Summary Compensation Table presented elsewhere in this Proxy Statement, was $4,537,958.$5,962,621.
Based on this information, for 20202022 the ratio of the annual total compensation of our CEO to the median of the annual total compensation of all employees was 93115 to 1.
Methodology, Assumptions and Estimates Used in Determining our Pay Ratio Disclosure
In determining the pay ratio calculation, we used the methodology, assumptions and estimates set forth below. We believe the pay ratio included in this information is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K.
1. |
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2. | We determined that, as of December 31, |
3. | Of our employee population as of December 31, |
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In total, the excluded employees represented 1.3% of our combined U.S. and non-U.S. workforce as of December 31, 2019.
4. | For purposes of measuring the compensation of our employee population, we selected total cash compensation. Total cash compensation includes base salary, hourly pay, overtime, bonuses and commissions, as reported on our payroll records. We measured total cash compensation of the employees included in the calculation over the |
5. | We gathered our total cash compensation information for the |
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did not make any cost-of-living adjustments in identifying the median employee. Amounts in foreign currency were converted from local currency to U.S. dollars using the average daily exchange rate of each country’s respective currency to U.S. dollars for the |
6. | Once we identified the median employee, we identified and calculated the elements of such employee’s compensation for |
66 Notice and Proxy Statement 2023 |
RELATIONSHIP OF COMPENSATION POLICIES AND PROGRAMS TO RISK MANAGEMENT
In consultation with the Compensation Committee, management conducted an assessment of whether Clear Channel Outdoor’s compensation policies and practices encourage excessive or inappropriate risk taking by our employees, including employees other than our named executive officers.NEOs. The assessment analyzed the risk characteristics of our business and the design and structure of our incentive plans and policies. Although a significant portion of our executive compensation program is performance-based, the Compensation Committee has focused on aligning Clear Channel Outdoor’s compensation policies with the long-term interests of Clear Channel Outdoor and avoiding rewards or incentive structures that could create unnecessary risks to Clear Channel Outdoor.
Management reported its findings to the Compensation Committee, which agreed with management’s assessment that our plans and policies do not encourage excessive or inappropriate risk taking and determined such policies or practices are not reasonably likely to have a material adverse effect on Clear Channel Outdoor.
The individuals who served as members of our Board during 20202022 are set forth in the table below. Only our independent directors are compensated for serving as directors of Clear Channel Outdoor.
On April 30, 2019, our board of directors approved a director compensation program for independent directors providing for an annual retainer of $75,000 in cash and $150,000 in equity (provided that the first of such annual equity grants will be $100,000 in equity and $150,000 in equity thereafter).equity. The equity will beis in the form of RSUs and will beis granted annually beginning(beginning in 2019,2020), with vesting prior to the subsequent year’s annual meeting of stockholders. Directors have the option to choose to receive up to 100% of their retainer in RSUs.
Non-independent directors do not receive additional fees for meeting attendance. The Chair of our board of directors (as long as the Chair is not an employee) receives an annual fee of $50,000, the Chair of the Audit Committee receives an annual fee of $25,000, the Chair of the Compensation Committee receives an annual fee of $20,000, and on October 21, 2021, our board of directors approved an increase to the annual fee payable to the Chair of the Nominating and Corporate Governance Committee, will receive anresulting in a total annual fee of $10,000.$15,000. Members of the Audit Committee (other than the Chair) receive an annual fee of $15,000, members of the Compensation Committee (other than the Chair) receive an annual fee of $10,000, and members of the Nominating and Corporate Governance Committee (other than the Chair) receive an annual fee of $7,500.
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Director Compensation Table
Name | Fees Earned or Paid in Cash ($) | Stock Awards(a) ($) | Option Awards(a) ($) | Total ($) | Fees Earned or Paid in Cash ($) | Stock Awards(a) ($) | Option Awards (a)($) | All Other Compensation ($) | Total ($) | |||||||||||||||||||||||||||
John Dionne | — | $ | 247,499 | — | $ | 247,499 | $ | 97,500 | $ | 149,997 | — | — | $ | 247,497 | ||||||||||||||||||||||
C. William Eccleshare | $ | 1,371,271 | (b) | — | 235,996 | (c) | $ | 1,607,267 | ||||||||||||||||||||||||||||
Lisa Hammitt | $ | 92,500 | $ | 149,999 | — | $ | 242,499 | $ | 92,500 | $ | 149,997 | — | — | $ | 242,497 | |||||||||||||||||||||
Andrew Hobson | $ | 100,000 | $ | 149,999 | — | $ | 249,999 | $ | 100,000 | $ | 149,997 | — | — | $ | 249,997 | |||||||||||||||||||||
Thomas King | — | $ | 244,998 | — | $ | 244,998 | — | $ | 244,995 | — | — | $ | 244,995 | |||||||||||||||||||||||
Joe Marchese | — | $ | 242,499 | — | $ | 242,499 | — | $ | 242,497 | — | — | $ | 242,497 | |||||||||||||||||||||||
W. Benjamin Moreland | — | $ | 274,998 | — | $ | 274,998 | — | $ | 274,997 | — | — | $ | 274,997 | |||||||||||||||||||||||
Mary Teresa Rainey(b) | $ | 102,474 | $ | 149,999 | — | $ | 252,473 | |||||||||||||||||||||||||||||
Mary Teresa Rainey(d) | $ | 105,491 | $ | 149,997 | — | — | $ | 255,488 | ||||||||||||||||||||||||||||
Jinhy Yoon | — | — | — | — | — | — | — | — | — |
(a) | Amounts in the Stock Awards and Option Awards columns reflect the full grant date fair value of stock and options awarded under our 2012 Amended and Restated Stock Incentive Plan during |
Notice and Proxy Statement 2023 67 |
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In addition, Messrs. |
For the restricted stock unit awards, the grant date fair value is based on the closing price of our common stock on the date of grant. |
For further discussion of the assumptions made in valuation, see also Note 13-Stockholders’ Deficit beginning on page |
(b) | The cash fees paid to Mr. Eccleshare reflect (1) a base salary of $625,000, and (2) a cash payment of $808,433 related to 2022 performance as an annual incentive plan award under the 2015 Executive Incentive Plan pursuant to pre-established performance goals. Certain amounts shown have been converted to GBP based on Mr. Eccleshare’s contractual exchange rate of $1=£0.7765 and then converted back to USD based on the average 2022 exchange rate of $1=£0.8117. |
(c) | The amount shown reflects: (1) payments in lieu of pension contributions of $89,684, (2) personal tax services paid by us of $49,780, (3) tax gross-ups on tax services of $40,729, (4) legal expenses related to his release agreement of $1,163, (5) the cost of private medical insurance of $23,192, (6) the cost of premiums for a supplemental life insurance benefit of $9,272, and (7) an automobile allowance of $22,176. |
(d) | The cash fees paid to Ms. Rainey were converted to GBP based on the exchange rate at the time of payment. Amounts shown here have been converted back to USD based on the average |
68 Notice and Proxy Statement
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EQUITY COMPENSATION PLAN INFORMATION
The following table summarizes information as of December 31, 20202022 relating to our equity compensation plans pursuant to which grants of options, restricted stock or other rights to acquire shares may be granted from time to time.
Number of Securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-Average exercise price of outstanding options, warrants and rights(1) | Number of Securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (A)) | Number of Securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-Average exercise price of outstanding options, warrants and rights(1) | Number of Securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (A)) | |||||||||||||||||||
Plan Category | (A) | (B) | (C) | (A) | (B) | (C) | ||||||||||||||||||
Equity Compensation Plans approved by security holders(2) | 26,363,321 | (3) | $ | 5.50 | 2,636,952 | 27,933,495 | (3) | $ | 5.56 | 27,095,736 | ||||||||||||||
Equity Compensation Plans not approved by security holders | — | — | — | — | — | — | ||||||||||||||||||
Total | 26,363,321 | $ | 5.50 | 2,636,952 | $ | 27,933,495 | $ | 5.56 | 27,095,736 |
(1) | The weighted-average exercise price is calculated based solely on the exercise prices of the outstanding options and does not reflect the shares that will be issued upon the vesting of outstanding awards of RSUs or PSUs, which have no exercise price. |
(2) | Represents the |
(3) | This number includes shares subject to outstanding awards granted, of which |
DELINQUENT SECTION 16(A) REPORTS
Section 16(a) of the Securities Exchange Act requires Clear Channel Outdoor’s directors, executive officers and beneficial owners of more than 10% of any class of equity securities of Clear Channel Outdoor to file reports of ownership and changes in ownership with the SEC.
To our knowledge, based solely on review of the reports filed electronically with the SEC and written representations that no other reports were required, during the fiscal year ended December 31, 2020, our officers, directors and greater than 10% beneficial owners timely filed all required Section 16(a) reports.
INTERLOCKS AND INSIDER PARTICIPATION
During 2020,2022, Messrs. King and Marchese and Ms. Hammitt served as the members of our Compensation Committee. There were no “interlocks” among any of the directors who served as members of our Compensation Committee and any of our executive officers during 20202022 and as of the date of this proxy statement.Proxy Statement. During 2020,2022, no member of our Compensation Committee simultaneously served as an executive officer of Clear Channel Outdoor. No member of our Compensation Committee had a relationship with us that requires disclosure under Item 404 of Regulation S-K.
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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
POLICY ON REVIEW AND APPROVAL OR RATIFICATION OF TRANSACTIONS WITH RELATED PERSONS
We have adopted formal written policies and procedures for the review and approval or ratification of certain related party transactions involving us and one of our executive officers, directors or nominees for director, or ownerowners of more than 5% of any class of our voting securities, and which may be required to be reported under the SECSEC’s disclosure rules. Such transactions must be pre-approved by the Audit Committee of our Board (other than the directors involved, if any) or by a majority of disinterested directors. In addition, if our management, in consultation with our Chief Executive Officer or Chief Financial Officer, determines that it is not practicable to wait untilconvene the next Audit Committee meeting to approve or ratify a particular transaction, then the Board has delegated authority to the Chair of the Audit Committee to approve or ratifypre-approve such transactions. The Chair of the Audit Committee reports to the Audit Committee any transactions reviewed by him or her pursuant to this delegated authority at the next Audit Committee meeting. The primary considerationconsiderations with respect to the approval of related party transactions isare the overall fairness of the terms of the transaction to us. The related party transactions described below in this proxy statement were ratified or approved by the Audit Committee or a special committee of the disinterested directors pursuant to these policiesus and procedures.that they are not inconsistent with our and our stockholder interests.
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS IN CONNECTION WITH THE SEPARATION
Following the separationMr. Cochrane, our Chief Executive Officer of Clear Channel Outdoor from iHeartMedia, Inc. (iHeartMedia”) on May 1, 2019 (the “Separation”), Clear Channel Outdoor and iHeartMedia operate separately, eachUK & Europe, who was appointed as an independent public company. Prior to“executive officer” as defined in Rule 3b-7 and an “officer” for purposes of Section 16 of the Separation, Clear Channel Outdoor and iHeartMediaExchange Act, effective January 1, 2023, entered into a Settlement and Separation Agreement (the “Separation Agreement”) and several other agreementsloan agreement with the Company in July of 2022 for principal of £1,000,000 with no annual interest rate. The purpose of the loan was to effect the merger of Clear Channel Outdoor and the old Clear Channel Outdoor Holdings, Inc., with Clear Channel Outdoor surviving, and the Separation and provide a framework for Clear Channel Outdoor’s relationship with iHeartMedia after the Separation. These agreements govern the relationships between Clear Channel Outdoor and iHeartMedia subsequentallow Mr. Cochrane to pay certain taxes owed to the completionIrish tax authorities that were erroneously withheld by the Company from Mr. Cochrane’s salary and paid to the United Kingdom tax authorities. Mr. Cochrane repaid the loan in full to the Company in December 2022 prior to his appointment as an executive officer of the Separation. In addition to the Separation Agreement, these agreements include: the Merger Agreement; the Transition Services Agreement; the New Tax Matters Agreement; the New EBIT Agreement; and the iHeartCommunications Line of Credit.
Pursuant to the Transition Services Agreement, iHM Management Services provided us with certain administrative and support services and other assistance which we will utilize in the conduct of our business as such business was conducted prior to the Separation, for one year from the effective date of the Separation (subject to certain rights we hold to extend up to one additional year, as described below). The transition services include, among other things, (a) treasury, payroll and other financial related services, (b) certain executive officer services, (c) human resources and employee benefits, (d) legal and related services, (e) information systems, network and related services, (f) investment services and (g) procurement and sourcing support. The Transition Services Agreement was terminated in August 2020.
The New EBIT Agreement terminated concurrently with the Transition Services Agreement.
The New Tax Matters Agreement allocates the responsibility of the iHeart Group, on the one hand, and the Outdoor Group, on the other, for the payment of taxes arising prior and subsequent to, and in connection with, the Separation. The New Tax Matters Agreement continues and remains in full force and effect.Company.
70 Notice and Proxy Statement
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The following Report of the Audit Committee concerns the Audit Committee’s activities regarding oversight of Clear Channel Outdoor’s financial reporting and auditing process, and it does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other filing under the Securities Act of 1933, as amended, or the Securities Exchange Act, except to the extent Clear Channel Outdoor specifically incorporates this Report by reference therein.
The Audit Committee is comprised solely of independent directors, and it operates under a written charter adopted by the Board. The charter reflects standards set forth in SEC regulations and NYSE rules. In addition, the composition of the Audit Committee, the attributes of its members and the responsibilities of the Audit Committee, as reflected in its charter, are intended to be in accordance with applicable requirements for corporate audit committees. The Audit Committee reviews and assesses the adequacy of its charter on an annual basis. The full text of the Audit Committee’s charter can be found on Clear Channel Outdoor’s website at www.investor.clearchanneloutdoor.comwww.investor.clearchannel.com.
As set forth in more detail in theits charter, the Audit Committee assists the Board in its general oversight of Clear Channel Outdoor’s financial reporting, internal control and audit functions. Management is responsible for the preparation, presentation and integrity of Clear Channel Outdoor’s financial statements, accounting and financial reporting principles and internal controls and procedures designed to ensure compliance with accounting standards, applicable laws and regulations. Ernst & Young LLP, the independent registered public accounting firm that serves as Clear Channel Outdoor’s independent auditor, is responsible for performing an independent audit of the consolidated financial statements and expressing an opinion on the conformity of those financial statements with United States generally accepted accounting principles, as well as expressing an opinion on the effectiveness of internal control over financial reporting.
The Audit Committee members are not professional accountants or auditors, and their functions are not intended to duplicate or to certify the activities of management and the independent auditor, nor can the Audit Committee certify that the independent auditor is “independent” under applicable rules. The Audit Committee serves a Board-level oversight role, in which it provides advice, counsel and direction to management and the auditors on the basis of the information it receives, discussions with management and the auditors and the experience of the Audit Committee’s members in business, financial and accounting matters.
Among other matters, the Audit Committee monitors the activities and performance of Clear Channel Outdoor’s internal and external auditors, including the audit scope and staffing, external audit fees, auditor independence matters and the extent to which the independent auditor may be retained to perform non-audit services. Subject to the consent of our corporate parent, theThe Audit Committee has ultimate authority and responsibility to select, evaluate and, when appropriate, replace Clear Channel Outdoor’s independent auditor. The Audit Committee also reviews the risk management and compliance processes and internal controls over financial reporting and the results of the internal and external audit work with regard to the adequacy and appropriateness of Clear Channel Outdoor’s financial, accounting and internal controls. Management and independent auditor presentations to, and discussions with, the Audit Committee also cover various topics and events that may have significant financial impact or are the subject of discussions betweenamong management and the independent auditor. In addition, the Audit Committee generally oversees Clear Channel Outdoor’s internal compliance programs.
The Audit Committee has implemented procedures to ensure that during the course of each fiscal year it devotes the attention that it deems necessary or appropriate to each of the matters assigned to it under the Audit Committee’s charter.
In overseeing the preparation of Clear Channel Outdoor’s financial statements, the Audit Committee met with both management and Clear Channel Outdoor’s independent auditors to review and discuss all financial statements prior to their issuance and to discuss significant accounting issues. Management advised the Audit Committee that the financial statements were prepared in accordance with generally accepted accounting principles. The Audit Committee’s review included discussion with the independent auditors of matters required to be discussed pursuant to the applicable requirements of the Public Company Accounting Oversight Board and the Securities and Exchange Commission.
With respect to Clear Channel Outdoor’s independent auditors, the Audit Committee, among other things, discussed with Ernst & Young LLP matters relating to its independence and received from the independent auditors
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their letter and the written disclosures required by applicable requirements of the Public Company Accounting Oversight Board regarding Ernst & Young LLP’s communications with the Audit Committee concerning independence.
On the basis of these reviews and discussions, the Audit Committee recommended to the Board of Directors that Clear Channel Outdoor’s audited financial statements be included in Clear Channel Outdoor’s Annual Report on Form 10-K for the year ended December 31, 2020,2022 for filing with the Securities and Exchange Commission.
Respectfully submitted, | ||
THE AUDIT COMMITTEE | ||
Andrew Hobson, Chair | ||
John Dionne | ||
Mary Teresa Rainey |
72 Notice and Proxy Statement
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The following fees for services provided by Ernst & Young LLP were incurred by Clear Channel Outdoor with respect to the years ended December 31, 20202022 and 2019:2021:
Years Ended December 31, | Years Ended December 31, | |||||||||||||||
(In thousands) | 2020 | 2019 | 2022 | 2021 | ||||||||||||
Audit Fees(a) | $ | 5,371 | $ | 5,662 | $ | 4,881 | $ | 5,826 | ||||||||
Audit-Related Fees(b) | 77 | 62 | 99 | 202 | ||||||||||||
Tax Fees(c) | 2,501 | 1,376 | 2,955 | 2,154 | ||||||||||||
All Other Fees(d) | 17 | 60 | 14 | 8 | ||||||||||||
Total Fees for Services | $ | 7,966 | $ | 7,160 | $ | 7,949 | $ | 8,190 |
(a) | Audit Fees include professional services rendered for the audit of annual financial statements and reviews of quarterly financial statements. This category also includes fees for statutory audits required internationally, services associated with documents filed with the SEC and in connection with securities offerings and private placements, work performed by tax professionals in connection with the audit or quarterly reviews and accounting consultation and research work necessary to comply with financial reporting and accounting standards. |
(b) | Audit-Related Fees include assurance and related services not reported under annual Audit Fees that reasonably relate to the performance of the audit or review of our financial statements and are not reported under Audit Fees, including attest and agreed-upon procedures services not required by statute or regulations, information systems reviews, due diligence related to mergers and acquisitions and employee benefit plan audits required internationally. |
(c) | Tax Fees include professional services rendered for tax compliance and tax planning advice provided domestically and internationally, except those provided in connection with the audit or quarterly reviews. |
(d) | All Other Fees include fees for products and services other than those in the above three categories. This category includes permitted corporate finance services and certain advisory services. |
Clear Channel Outdoor’s Audit Committee has considered whether Ernst & Young LLP’s provision of non-audit services to Clear Channel Outdoor is compatible with maintaining Ernst & Young LLP’s independence.
The Audit Committee pre-approves all audit and permitted non-audit services (including the fees and terms thereof) to be performed for Clear Channel Outdoor by its independent auditor. The Chair of the Audit Committee may represent the entire committee for the purposes of pre-approving permissible non-audit services, provided that the decision to pre-approve any service is disclosed to the Audit Committee no later than its next scheduled meeting.
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PROPOSAL 2: ADVISORY RESOLUTION ON EXECUTIVE COMPENSATION
We are asking our stockholders to approve an advisory resolution on our executive compensation as reported in this proxy statement.Proxy Statement. As described above in the Compensation Discussion and Analysis section of this proxy statement,Proxy Statement, we believe that compensation of our named executive officers should be directly and materially linked to operating performance. The fundamental objective of our compensation program is to attract, retain and motivate top quality executives through compensation and incentives whichthat are competitive with the various labor markets and industries in which we compete for talent and whichthat align the interests of our executives with the interests of our stockholders.
Overall, we have designed our compensation program to:
support our business strategy and business plan by clearly communicating what is expected of executives with respect to goals and results and by rewarding achievement;
recruit, motivate and retain executive talent; and
align executive performance with stockholder interests.
We urge stockholders to read the Compensation Discussion and Analysis section of this proxy statement,Proxy Statement, which describes in more detail how our executive compensation policies and procedures operate and are designed to achieve our compensation objectives, as well as the Summary Compensation Table and other related compensation tables and narrative appearing in this proxy statement,Proxy Statement, which provide detailed information on the compensation of our named executive officers.
In accordance with Section 14A of the Securities Exchange Act, and as a matter of good corporate governance, we are asking stockholders to approve the following advisory resolution at our annual meeting:the Annual Meeting:
RESOLVED, that the stockholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the proxy statementProxy Statement for the 2021 annual meeting2023 Annual Meeting of stockholders pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, the Summary Compensation Table and the related compensation tables, notes and narrative.
This resolution, commonly referred to as a “say-on-pay”“say-on-pay” resolution, is advisory, which means that the vote is not binding on Clear Channel Outdoor, our Board or our Compensation Committee. The vote on this resolution is not intended to address any specific element of compensation, but rather is related to the overall compensation of our named executive officers, as described in this proxy statementProxy Statement pursuant to the rules of the SEC. Although non-binding, the Board and the Compensation Committee will review and consider the voting results when making future decisions regarding our executive compensation program.
The Board recommends that you vote “FOR” approval of the advisory resolution on executive compensation above. Properly submitted proxies will be so voted unless stockholders specify otherwise.
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PROPOSAL 3: APPROVAL OF THE ADOPTION OF THE CLEAR CHANNEL OUTDOOR HOLDINGS, INC. 2012 SECOND AMENDED AND RESTATED EQUITY INCENTIVE PLAN
Our Board approved and adopted the Clear Channel Outdoor Holdings, Inc. 2012 Second Amended and Restated Stock Incentive Plan (as amended and restated, the “2021 Plan”) on February 23, 2021, subject to the approval our stockholders. If we do not obtain stockholder approval of the 2021 Plan, the current 2012 Amended and Restated Stock Incentive Plan (the “Prior Incentive Plan”) will remain in effect, without giving effect to the proposed amendment and restatement described herein, and will expire in accordance with its terms on March 23, 2027.
The Board adopted the 2021 Plan as a broad-based incentive compensation plan that provides for granting stock options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”), and performance-based cash and stock awards. The Board believes that our success and long-term progress are dependent upon attracting and retaining our directors, officers, employees, consultants, and advisers, and aligning the interests of such individuals with those of our stockholders. The 2021 Plan gives the Compensation Committee the maximum flexibility to use various forms of incentive awards as part of our overall compensation program.
The following information regarding the 2021 Plan is being provided to you in connection with the solicitation of proxies for the approval of the 2021 Plan.
BACKGROUND
The 2021 Plan is necessary for us to continue to attract, retain and motivate our executives, employees and directors through the grant of stock options, stock appreciation rights, restricted stock, restricted stock units and performance-based cash and stock awards. One of the principal objectives of our compensation program is to align the interests of our executives, employees and directors with those of our stockholders. In order to do so, we rely on our ability to grant equity awards that directly link compensation to our stock price performance over time.
We believe that our success depends, in large part, on our ability to attract, retain and motivate employees with experience and ability. Our equity-based compensation plays a critical role in attracting, retaining and motivating those employees and in aligning their compensation with stockholder interests. Equity awards are a key competitive element of our total compensation package, without which we would be challenged to recruit top talent from a competitive marketplace for human capital. We use equity awards with multi-year vesting and/or performance metrics as a retentive tool in order to strengthen our ability to retain top talent and encourage long-term service. We also use equity awards to recognize individual contributions, to reward achievement of Clear Channel Outdoor goals and to promote the creation of long-term stockholder value by closely aligning the interests of executives, employees and directors with those of our stockholders.
As of February 28, 2021, there were 1,302,510 shares of our common stock available for future grants under the Prior Incentive Plan, assuming outstanding performance-based awards are counted at “maximum”. We estimate that that the shares available for future awards, including the 35,000,000 additional shares if the 2021 Plan is approved, will be sufficient for equity awards for four to six years. However, the proposed share reserve could last for a shorter or longer period of time, such as might be the case if we experience unexpected opportunities to grow the business beyond our current annual operating plan, if we modify our long-term incentive mix and design, or if our stock price changes materially.
If our stockholders do not approve the 2021 Plan, we expect the share reserve under the Prior Incentive Plan to be exhausted within one year and thereafter we would no longer be able to grant equity awards as part of our total compensation package. In that event, we may need to consider other compensation alternatives, such as increasing cash compensation, which would have a negative impact on our reported results of operations, and we would be at a severe competitive disadvantage if we could not use equity awards to recruit and retain top talent. The Board believes
that approval of the 2021 Plan will enable us to continue to grant equity awards in a manner that is consistent with market practices, which is important to allow us to competitively attract, retain, reward and motivate our executives, employees, and directors, who are critical to achieving our business goals.
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Each year, the Compensation Committee and our management review our overall compensation strategy and determine the allocations of cash and equity compensation in light of our pay for performance philosophy. In determining the proposed share reserve under the 2021 Plan, and analyzing the impact of using equity awards as a means of compensation on our stockholders, the Compensation Committee considered: current market practices in the use of equity compensation; that we have not requested additional shares from stockholders since 2012; that the shares currently available under the Prior Incentive Plan may not be sufficient for awards to be granted in 2021; our historical and expected future burn rate; the potential dilution of the 2021 Plan (as described below); our current stock price; recent experiences with respect to the value of equity awards expected by employees; and advice of the Compensation Committee’s compensation consultant.
Our Board believes that the proposed share reserve under the 2021 Plan represents a reasonable amount of potential dilution in light of the foregoing factors, is aligned with the practices of our compensation peer group, and will allow us to continue awarding equity awards, a critical component of our overall compensation program. Although the use of equity is an important part of our compensation program, we are mindful of our responsibility to our stockholders in granting equity awards. We remain committed to effectively managing our share reserves for equity compensation while minimizing stockholder dilution.
HISTORICAL SHARE USAGE AND DILUTION
The following table sets forth information regarding awards granted and the burn rate for each of the last three fiscal years and the average burn rate over such period. For each fiscal year, the burn rate has been calculated as the quotient of (1) awards granted in such year divided by (2) the weighted average number of shares of our common stock outstanding at the end of such year.
Fiscal Year Ended December 31 | Three-Year Average | |||||||||||||||
2020 | 2019 | 2018 | ||||||||||||||
Equity Awards Granted | 14,546,331 | 8,650,624 | 2,050,406 | 8,409,749 | ||||||||||||
Weighted Average Shares Outstanding | 464,521,686 | 413,086,954 | 361,739,717 | 413,116,119 | ||||||||||||
Burn Rate | 3.1% | 2.1% | 0.6% | 2.0% |
The Prior Plan is our only active employee equity plan with shares available for future issuance. The table below outlines key information regarding all of Clear Channel’s outstanding equity awards as of February 28, 2021 and the impact on potential dilution (or overhang) levels based on our shares of common stock outstanding and our request of 35,000,000 additional shares of common stock to be available for awards pursuant to the 2021 Plan.
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AMENDMENTS
The 2021 Plan is consistent in substance with the Prior Incentive Plan, but with several updates, including that the 2021 Plan:
imposes a $500,000 limit on the fair value of awards that may be granted and all cash retainers that may be paid to any non-employee director during any calendar year;
eliminates the prescriptive performance vesting criteria in light of the recent changes to Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”) (as described below);
provides that any dividends and other distributions payable with respect to an award shall be distributed to the award holder only if, when and to the extent such award vests. The value of dividends and other distributions payable with respect to award that do not vest shall be forfeited;
provides that without shareholder approval, the terms of outstanding awards may not be amended to reduce the exercise price of outstanding options or SARs or cancel outstanding options or SARs in exchange for cash, other awards or options or SARs with an exercise price that is less than the exercise price of the original options or SARs without stockholder approval; and
provides that upon a change in control, unvested awards will not automatically be accelerated and outstanding awards may be, at the Compensation Committee’s discretion, continued, assumed, substituted, settled in cash, cancelled after allowing a period for the participant to exercise (only for awards subject to exercise), or accelerated, in each case subject to specific requirements described more fully below.
HIGHLIGHTS OF THE 2021 PLAN’S BEST PRACTICES
The 2021 Plan combines compensation and governance best practices, including the following features:
performance-based awards as a core component;
express prohibition of repricing of stock options and stock appreciation rights (“SARs”);
awards are subject to clawback under the Company’s policy as well as legal requirements;
the exercise price of a stock option or SAR award may not be less than the fair market value of the stock on the date of grant;
annual compensation cap of $500,000 for non-employee directors;
no evergreen provision;
no tax gross-ups or reload grants; and
no dividends or other distributions payable with respect to plan awards unless and until the underlying award vests.
PLAN SUMMARY
The principal features of the 2021 Plan are summarized below. This summary does not purport to be complete, and is qualified in its entirety by reference to the full text of the 2021 Plan attached as Appendix A to this Proxy Statement.
Administration
The 2021 Plan will be administered by the Compensation Committee; however, the full Board of Directors will have sole responsibility and authority for making and administering awards to any of our non-employee directors. Subject to the terms of the 2021 Plan, the Compensation Committee has authority to (1) select the individuals that may participate in the plan, (2) prescribe the terms and conditions of each participant’s award and make amendments thereto, (3) construe, interpret, and apply the provisions of the 2021 Plan and of any award made under the plan, and (4) take all other actions necessary to administer the 2021 Plan. The Compensation Committee may delegate any of its responsibilities and authority to other persons, subject to applicable law.
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Shares Covered by the 2021 Plan
Subject to adjustments as required or permitted by the 2021 Plan’s terms, under the 2021 Plan, we may issue a total of (1) 35,000,000 shares of our common stock, $0.01 par value per share, plus (2) 29,142,027, which represents the number of shares of our common stock reserved under the plan on February 16, 2012 and of which 1,302,510 shares of our common stock remain available for issuance under the plan as of February 28, 2021, plus (3) the number of shares of common stock granted under the Company’s 2005 Stock Incentive Plan, as amended and restated, that would be considered “Lapsed Awards” under Section 3.2 of the 2021 Plan (as more fully described below) had they been granted under the 2021 Plan. The closing sale price of our common stock as of February 28, 2021 was $1.72.
The following shares are not taken into account in applying these limitations: (1) shares covered by awards that expire or are canceled, forfeited, settled in cash, or otherwise terminated; (2) shares delivered to us or withheld by us for the payment or satisfaction of purchase price or tax withholding obligations associated with the exercise or settlement of an award; and (3) shares covered by stock-based awards assumed by us in connection with the acquisition of another company or business (collectively, “Lapsed Awards”).
Individual Award Limitations
In any calendar year, the maximum aggregate grant date fair value of all awards granted to an individual non-employee director and cash fees paid by the Company to such non-employee director outside of the 2021 Plan shall not exceed $500,000.
Dividends
Any dividends, dividend equivalents, or other distributions payable with respect to any award under the 2021 Plan will be distributed to the award holder only if, when and to the extent the underlying award vests. The value of dividends dividend equivalents and other distributions payable with respect to awards that do not vest are forfeited.
Eligibility
Awards may be made under the 2021 Plan to any of our or our subsidiaries’ present or future directors, officers, employees, consultants, or advisers. As of February 28, 2021, there were approximately 4,932 employees and 7 non-employee directors who were eligible to receive awards under the 2021 Plan, and, as of February 28, 2021, 167 employees and 7 non-employee directors participated in the 2021 Plan.
Forms of Award
Stock Options and Stock Appreciation Rights. We may grant stock options that qualify as “incentive stock options” under Section 422 of the Code (“ISOs”), as well as stock options that do not qualify as ISOs. However, no ISOs may be granted subsequent to the tenth anniversary of the date that the 2021 Plan is adopted. We also may grant SARs. In general, a SAR gives the holder the right to receive the appreciation in value of the shares of our common stock covered by the SAR from the date the SAR is granted to the date the SAR is exercised. The per share exercise price of a stock option and the per share base value of a SAR may not be less than the fair market value per share of common stock on the date the stock option or SAR is granted. We may not amend the terms of outstanding awards to reduce the exercise price of outstanding stock options or SARs or to cancel outstanding options or SARs in exchange for cash, other awards or options or SARs with an exercise price that is less than the exercise price of the original options or SARs without stockholder approval. Generally, the term of a stock option is ten years; provided, however, the term of an ISO granted to a 10% stockholder may not be greater than five years and the exercise price may not be less than 110% of the fair market value per share of our common stock on the date the option is granted.
The Compensation Committee may impose such exercise, forfeiture, and other terms and conditions as it deems appropriate with respect to stock options and SARs. The exercise price under a stock option may be paid in cash or in any other form or manner permitted by the Compensation Committee, including without limitation, payment of previously-owned shares of our common stock or payment pursuant to broker-assisted cashless exercise procedures. Methods of exercise and settlement and other terms of SARs will be determined by the Compensation Committee.
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The Compensation Committee may establish such exercise and other conditions applicable to an option following the termination of the optionee’s employment or other service with us and our subsidiaries as the Compensation Committee deems appropriate on a grant-by-grant basis.
Restricted Stock and RSUs. The 2021 Plan authorizes the Compensation Committee to make restricted stock awards, pursuant to which shares of the common stock are issued to designated participants subject to transfer restrictions and vesting conditions. Subject to such conditions as the Compensation Committee may impose, the recipient of a restricted stock award may be given the rights to vote and receive dividends on shares covered by the award pending the vesting or forfeiture of the shares.
RSUs generally consist of the right to receive shares of common stock in the future, subject to such conditions as the Compensation Committee may impose including, for example, continuing employment or service for a specified period of time or satisfaction of specified performance criteria. Prior to settlement, RSUs do not carry voting, dividend, or other rights associated with stock ownership; however, dividend equivalents may accrue if the Compensation Committee so determines, but such dividend equivalents will not be payable unless and until such RSUs vest.
Unless the Compensation Committee determines otherwise, shares of restricted stock and non-vested RSUs will be forfeited upon the recipient’s termination of employment or other service with the Company and its subsidiaries.
Other Stock-Based Awards. The 2021 Plan gives the Compensation Committee broad discretion to grant other types of equity-based awards, including, for example, dividend equivalent payment rights, phantom shares, bonus shares, and PSUs and to provide for settlement in cash and/or shares. The 2021 Plan also allows non-employee directors to elect to receive all or part of their annual retainers in the form of shares of the common stock in lieu of cash.
Performance-Based Awards. The Compensation Committee may also grant performance-based awards under the 2021 Plan. In general, performance awards provide for the payment of cash and/or shares of common stock upon the achievement of objective, predetermined performance objectives established by the Compensation Committee.
Adjustments of Awards
Generally, in the event of a split-up, spin-off, recapitalization, or consolidation of shares or any similar capital adjustment, or a change in the character or class of shares covered by the 2021 Plan or any award made pursuant to the plan, we will adjust (1) the maximum number of shares of common stock which may be issued under the 2021 Plan, (2) the maximum number of shares of common stock which may be covered by awards made to an individual in any calendar year, (3) the number of shares of common stock subject to outstanding awards, and (4) where applicable, the exercise price, base price, target market price, or purchase price under outstanding awards, as required to equitably reflect the effect on the common stock of such transactions or changes.
Change in Control
In connection with a change in control (as defined in the 2021 Plan), except as otherwise provided by the Compensation Committee in an award agreement, unvested awards will not vest automatically and each outstanding award will be treated, at the discretion of the committee, in accordance with one or more of the following: (1) awards, whether or not vested, may be continued or substituted in accordance with applicable law and any restrictions to which award granted prior to the change in control are subject will not lapse and the award holder will, receive the same distribution as holders of other shares of common stock or additional awards in lieu of a cash distribution; (2) awards may be purchased by the Company for an amount equal to the excess (if any) of the price paid or value of a share of the Company’s common stock over the exercise price of the award or be cancelled if the price of a share of our common stock paid in a change in control is less than the exercise price of the award; (3) awards may be terminated, in the event that the award is a stock option, stock appreciation right or other stock-based award that provides for a participant elected exercise, provided that the Company must give each participant the opportunity to exercise in full all outstanding Awards (without regard to any limitations on exercisability) for at least 20 days prior to the consummation of the change in control, with any such exercise being contingent on the occurrence of such change in control, and (4) the Compensation Committee may provide for accelerated vesting or the lapse of any remaining restriction of an award at any time.
74 Notice and Proxy Statement
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PROPOSAL 3: ADVISORY VOTE ON THE FREQUENCY OF FUTURE SAY-ON-PAY VOTES
Amendment and TerminationPursuant to Section 14A of the Plan; Term
ExceptExchange Act, we are asking our stockholders to vote on whether future advisory votes on executive compensation of the nature reflected above in Proposal 2 should occur every year, every two years or every three years. Stockholders also may abstain from voting. This non-binding advisory vote is commonly referred to as may otherwise be required by law or“say-on-pay frequency” vote. Stockholders last voted on the requirementsadvisory vote on executive compensation at our annual meeting of any stock exchange or market upon whichstockholders held in 2017. At such meeting, our common stock may then be listed,stockholders recommended, and the Board acting in its sole discretion and without further actiondetermined, that the stockholder vote on the partcompensation of our stockholders, may amendnamed executive officers would occur every three years. In 2021, however, our Board determined to change the 2021 Plan at any time and from time to time and may terminate the 2021 Plan at any time. No such amendment or termination may impair or adversely alter any awards previously granted under the plan (without the consentfrequency of the recipient or holder) or deprive any person“say-on-pay” votes to occur every year, in order to allow us to obtain stockholder input on our executive compensation program on a more regular basis.
After careful consideration and receiving feedback from stockholders during our ongoing outreach efforts, the Board considers that future advisory votes on executive compensation should continue to occur every year (annually). We believe that an annual advisory vote furthers our objective of shares previously acquired underengaging in regular and timely communication with our stockholders regarding our executive compensation policies.
The vote is advisory, which means that the plan. Unless sooner terminated, the plan shall terminatevote is not binding on the tenth anniversary of the date of its adoption byClear Channel Outdoor, our Board or February 23, 2031.
Withholding
In respectour Compensation Committee. The Board will consider the frequency that receives the highest number of votes to be the frequency selected by our stockholders, regardless of whether that frequency receives a majority of the exercise or settlement ofvotes cast. However, because this vote is advisory and not binding in any award underway, the 2021 Plan, the Company has the authority to (1) deduct or withhold (or cause to be deducted or withheld) from any payment or distribution otherwise payable to the participant, whether or not such payment or distributionBoard may decide that it is covered by the plan, or (2) require the recipient to remit cash (through payroll deduction or otherwise) or make other arrangements permitted by the Company, in each case in an amount or of a nature sufficient in the opinionbest interests of the Companystockholders and Clear Channel Outdoor to satisfyhold an advisory vote on executive compensation more or provideless frequently than the option selected by our stockholders.
The proxy card provides stockholders with the opportunity to choose from among four options (holding the vote every one, two or three years, or abstaining from voting), and therefore, stockholders will not be voting to approve or disapprove the recommendation of our Board.
The Board recommends that you vote for the satisfactionoption of such withholding obligation. If“ONE YEAR” as the event giving rise to the withholding obligation involves a transfer of shares of our common stock, then, at the sole discretion of the Compensation Committee, the participant may satisfy the withholding obligations associated with such transfer by electing to have the Company withhold shares of common stock or by tendering previously-owned shares of common stock, in each case having a fair market value equal to the amount of tax to be withheld.
Section 409A
Section 409A of the Code imposes restrictionspreferred frequency for advisory votes on non-qualified deferredexecutive compensation. Failure to satisfy these rules results in accelerated taxation, an additional tax to the holder of an amount equal to 20% of the deferred amount and a possible interest charge. Stock options and stock appreciation rights granted on shares with an exercise price that is not less than the fair market value of the underlying shares on the date of grant will not give rise to “deferred compensation” for this purpose unless they involve additional deferral features. Stock options and stock appreciation rights that would be awarded under the 2021 Plan are intended to be eligible for this exception.
U.S. FEDERAL INCOME TAX CONSEQUENCES
The grant of a stock option or SAR under the 2021 Plan is not a taxable event to the participant for federal income tax purposes. In general, ordinary income is realized upon the exercise of a stock option (other than an ISO) in an amount equal to the excess of the fair market value on the exercise date of the shares acquired pursuant to the exercise over the option exercise price paid for the shares. The amount of ordinary income realized upon the exercise of an SAR is equal to the excess of the fair market value of the shares covered by the exercise over the SAR base price. The Company generallyProperly submitted proxies will be entitled to a deduction equal to the amount of ordinary income realized by a participant upon the exercise of an option or SAR. The tax basis of shares acquired upon the exercise of a stock option (other than an ISO) or SAR is equal to the value of the shares on the date of exercise. Upon a subsequent sale of the shares, capital gain or loss (long-term or short-term, depending on the holding period of the shares sold) will be realized in an amount equal to the difference between the selling price and the basis of the shares. Certain additional rules apply if the exercise price of an option is paid in shares previously owned by participant.
No income is realized upon the exercise of an ISO other than for purposes of the alternative minimum tax. Income or loss is realized upon a disposition of shares acquired pursuant to the exercise of an ISO. If the disposition occurs more than one year after the ISO exercise date and more than two years after the ISO grant date, then gain or loss on the disposition, measured by the difference between the selling price and the option exercise price for the shares, will be long-term capital gain or loss. If the disposition occurs within one year of the exercise date or within two years of the grant date, then the gain realized on the disposition will be taxable as ordinary income to the extent such gain is not more than the difference between the value of the shares on the date of exercise and the exercise price, and the balance of the gain, if any, will be capital gain. The Company is not entitled to a deduction with respect to the exercise of an ISO; however, it is entitled to a deduction corresponding to the ordinary income realized by a participant upon a disposition of shares acquired pursuant to the exercise of an ISO before the satisfaction of the applicable one- and two-year holding period requirements described above.so voted unless stockholders specify otherwise.
Notice and Proxy Statement
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In general, a participant will realize ordinary income with respect to common stock received pursuant to a restricted stock award at the time the shares become vested in accordance with the terms of the award in an amount equal to the fair market value of the shares at the time they become vested, and except as discussed below, the Company is generally entitled to a corresponding deduction. The participant’s tax basis in the shares will be equal to the ordinary income so recognized. Upon subsequent disposition of the shares, the participant will realize long-term or short-term capital gain or loss, depending on the holding period of the shares sold.
A participant may, however, make an election under Section 83(b) of the Code to have the grant taxed as compensation income at the date of receipt, with the result that any future appreciation or depreciation in the value of the shares of stock granted may be taxed as capital gain or loss on a subsequent sale of the shares. If the participant does not make a Section 83(b) election, the grant will be taxed as compensation income at the full fair market value on the date the restrictions imposed on the shares expire. Unless a participant makes a Section 83(b) election, any dividends paid to the participant on the shares of restricted stock will generally be compensation income to the participant and deductible by us as compensation expense.
A participant who receives RSUs will be taxed at ordinary income tax rates based on the fair market value of the shares of common stock distributed at the time of settlement of the RSUs and, except as discussed below, the Company will generally be entitled to a tax deduction at that time. The participant’s tax basis in the shares will equal the amount taxed as ordinary income, and on subsequent disposition the participant will realize long-term or short-term capital gain or loss.
Other awards, including RSUs and PSUs, will generally result in ordinary income to the participant at the later of the time of delivery of cash, shares, or other awards, or the time that either the risk of forfeiture or restriction on transferability lapses on previously delivered cash, shares, or other awards. Except as discussed below, the Company generally will be entitled to a tax deduction equal to the amount recognized as ordinary income by the participant in connection with an award, but will be entitled to no tax deduction relating to amounts that represent a capital gain to a participant.
Under Section 162(m) of the Code, no deduction is allowed in any taxable year of the Company for compensation in excess of $1,000,000 paid to the Company’s “covered employees.” A “covered employee” is any individual who has served at any time after December 31, 2016 as the Company’s chief executive officer, chief financial officer, or other executive officer whose compensation has been reported in a Company proxy statement, regardless of whether any such individual is still employed by the Company. The Company may be prohibited under Section 162(m) of the Code from deducting compensation paid pursuant to the 2021 Plan to our “covered employees.”
THE ABOVE SUMMARY PERTAINS SOLELY TO CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES ASSOCIATED WITH AWARDS GRANTED UNDER THE 2021 PLAN AND DOES NOT PURPORT TO BE COMPLETE. THE SUMMARY DOES NOT ADDRESS ALL FEDERAL INCOME TAX CONSEQUENCES AND IT DOES NOT ADDRESS STATE, LOCAL, AND NON-U.S. TAX CONSIDERATIONS.
NEW PLAN BENEFITS
A new plan benefits table for the 2021 Plan and the benefits or amounts that would have been received by or allocated to certain participants for the last completed fiscal year under the 2021 Plan if the 2021 Plan was then in effect, as described in the federal proxy rules, is not provided because all awards made under the 2021 Plan will be made at the Board’s or Compensation Committee’s discretion. Therefore, the benefits and amounts that would be received or allocated under the 2021 Plan are not determinable at this time.
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EQUITY COMPENSATION PLAN INFORMATION
The following table summarizes information as of December 31, 2020 relating to our equity compensation plans pursuant to which grants of options, restricted stock or other rights to acquire shares may be granted from time to time.
Number of Securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-Average exercise price of outstanding options, warrants and rights(1) | Number of Securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column(2)) | ||||||||||
Plan Category | (A) | (B) | (C) | |||||||||
Equity Compensation Plans approved by security holders | 26,363,321 | (3) | $ | 5.50 | 2,636,952 | |||||||
Equity Compensation Plans not approved by security holders | — | — | — |
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The Board recommends that you vote “For” approval of the adoption of the 2021 Plan. Properly submitted proxies will be so voted unless stockholders specify otherwise.
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PROPOSAL 4: RATIFICATION OF SELECTION OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee has reappointed Ernst & Young LLP as the independent registered public accounting firm to audit the consolidated financial statements of Clear Channel Outdoor for the year ending December 31, 2021.2023.
Stockholder ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm is not required by our bylawsBy-laws or any other applicable legal requirement. However, the Board is submitting the selection of Ernst & Young LLP to the stockholders for ratification as a matter of good corporate practice.governance. If the appointment of Ernst & Young LLP is not ratified, the Audit Committee will evaluate the basis for the stockholders’ vote when determining whether to continue the firm’s engagement, but ultimately may determine to continue the engagement of the firm or another audit firm without re-submitting the matter to stockholders. Even if the appointment of Ernst & Young LLP is ratified, the Audit Committee may terminate the appointment of Ernst & Young LLP as the independent registered public accounting firm without stockholder approval whenever the Audit Committee deems termination necessary or appropriate.
Representatives of Ernst & Young LLP are expected to be present at the annual meeting of stockholders,Annual Meeting, will have an opportunity to make a statement if they so desire and will be available to respond to appropriate questions.
The Board recommends that you vote “FOR” the ratification of the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2021.2023. Properly submitted proxies will be so voted unless stockholders specify otherwise.
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STOCKHOLDER PROPOSALS FOR 20222024 ANNUAL MEETING
AND ADVANCE NOTICE PROCEDURES
Stockholders interested in submitting a proposal for inclusion in our proxy materials for the annual meeting of stockholders in 20222024 may do so by following the procedures prescribed in SEC Rule 14a-8. To In general ,to be eligible for inclusion, stockholder proposals must be received by the Corporate Secretary of Clear Channel Outdoor no later than November 24, 2021,23, 2023 and must otherwise comply with the SEC’s rules. Proposals should be sent to: Corporate Secretary, Clear Channel Outdoor Holdings, Inc., 4830 North Loop 1604W, Suite 111, San Antonio, Texas 78249.
If you intend to present a proposal at the annual meeting of stockholders in 2022,2024 (other than pursuant to Rule 14a-8), or if you want to nominate one or more directors at the annual meeting of stockholders in 2022,2024, you must comply with the advance notice provisions of Clear Channel Outdoor’s bylaws. IfBy-laws, which require, among other things, that you intend to present a proposal at the annual meeting, or if you want to nominate one or more directors, you must give timely notice thereof in writing to the Corporate Secretary at the address set forth above. Our Secretary must receive the notice not less than 90 days and not more than 120 days before the anniversary date of the immediately preceding annual meeting of stockholders. This means that, for our 2022 annual meeting, ourCorporate Secretary must receive the notice no earlier than the close of business on January 5, 20224, 2024 and no later than the close of business on February 4, 2022.3, 2024. However, if the date of our 2024 Annual Meeting is more than 30 days before or after the first anniversary of the date of the Annual Meeting, then our Corporate Secretary must receive the notice no earlier than the close of business on the 120th calendar day prior to the date of the 2024 Annual Meeting and not later than the close of business on the later of the 90th calendar day prior to the date of the 2024 Annual Meeting and the 10th calendar day following the day on which public announcement of the date of 2024 Annual Meeting is first made by us. You may contact our Corporate Secretary at the address set forth above for a copy of the relevant bylawBy-law provisions regarding the requirements for making stockholder proposals and nominating director candidates.
In addition to satisfying the requirements of the By-laws, to comply with the requirements set forth in Rule 14a-19 of the Exchange Act (the universal proxy rules), stockholders who intend to solicit proxies in support of director nominees other than the Board’s nominees must also provide written notice to the Corporate Secretary that sets forth all the information required by Rule 14a-19(b) of the Exchange Act. Such notice must be postmarked or transmitted electronically to the Company at the Company’s principal executive offices no later than March 4, 2024.
OTHER MATTERS
Neither Clear Channel Outdoor’s management nor the Board knows of any other business to be brought before the annual meetingAnnual Meeting other than the matters described above. If any other matters properly come before the annual meeting,Annual Meeting, the proxies will be voted on such matters in accordance with the judgment of the persons named as proxies therein, or their substitutes, present and acting at the meeting.
The cost of soliciting proxies will be borne by Clear Channel Outdoor. Following the original mailing of the proxy soliciting material, for a fee of approximately $18,500, plus certain costs and expenses, Innisfree M&A Incorporated may assist Clear Channel Outdoor in soliciting proxies. In addition, regular employees of Clear Channel Outdoor may solicit proxies by mail, telephone, facsimile, e-mail and personal interview. Proxy cards and materials will also be distributed to beneficial owners of stock, through brokers, custodians, nominees and other like parties. Clear Channel Outdoor expects to reimburse such parties for their charges and expenses connected therewith.
The SEC has adopted rules that permit companies and intermediaries such as brokers to satisfy delivery requirements for proxy statements with respect to two or more stockholders sharing the same address by delivering a single proxy statement addressed to those stockholders. This process, which is commonly referred to as “householding,”“householding”, potentially provides extra convenience for stockholders and cost savings for companies. Clear Channel Outdoor and some brokers household proxy materials, delivering a single proxy statementProxy Statement to multiple stockholders sharing an address unless contrary instructions have been received from the affected stockholders. Once you have received notice from your broker or us that they or we will be householding materials to your address,
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householding will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate proxy statement,Proxy Statement, please notify your broker if your shares are held in a brokerage account or us if your shares are registered in your name. You can notify us by sending a written request to Clear Channel Outdoor Holdings, Inc., Investor Relations, 4830 North Loop 1604W, Suite 111, San Antonio, Texas 78249 or by calling (210) 832-3700. Upon written or oral request, we will promptly deliver a separate copy of this proxy statementProxy Statement to a beneficial owner at a shared address to which a single copy of the proxy statementProxy Statement was delivered.
An electronic copy of Clear Channel Outdoor’s Annual Report on Form 10-K filed with the SEC on February 25, 202128, 2023 is available free of charge at Clear Channel Outdoor’s website at www.investor.clearchanneloutdoor.comwww.investor.clearchannel.com. A paper copy of the Form 10-K is also are available without charge to stockholders upon written request to: Investor Relations, Clear Channel Outdoor Holdings, Inc., 4830 North Loop 1604W, Suite 111, San Antonio, Texas 78249.
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CLEAR CHANNEL OUTDOOR HOLDINGS, INC.
2012 SECOND AMENDED AND RESTATED STOCK INCENTIVE PLAN
(February 23, 2021 Amendment and Restatement)
1. Purpose. The purpose of the plan is to facilitate the ability of Clear Channel Outdoor Holdings, Inc. (the “Company”) and its subsidiaries to attract, motivate and retain eligible employees, directors and other personnel through the use of equity-based and other incentive compensation opportunities. For purposes herein, references to the plan shall be deemed references to the plan as amended and restated. Awards made under the plan may take the form of options to purchase shares of the Company’s common stock, $.01 par value (the “Common Stock”) granted pursuant to Section 5, director shares issued pursuant to Section 6, stock appreciation rights granted pursuant to Section 7, restricted stock and restricted stock units issued or granted pursuant to Section 8, other types of stock-based awards made pursuant to Section 9, and/or performance-based awards made pursuant to Section 10 (collectively, the “Awards”).
2. Administration.
2.1 The Committee. The plan will be administered by the compensation committee of the Company’s board of directors, except the entire board will have sole authority for granting and administering Awards to non-employee directors.
2.2 Responsibility and Authority of the Committee. Subject to the provisions of the plan, the committee, acting in its discretion, will have responsibility and the power and authority to (a) select the persons to whom Awards will be made, (b) prescribe the terms and conditions of each Award and make amendments thereto, (c) construe, interpret and apply the provisions of the plan and of any agreement or other document evidencing an Award made under the plan, and (d) make any and all determinations and take any and all other actions as it deems necessary or desirable in order to carry out the terms of the plan. The committee may obtain at the Company’s expense such advice, guidance and other assistance from outside compensation consultants and other professional advisers as the committee deems appropriate in connection with the proper administration of the plan.
2.3 Delegation of Authority by Committee. Subject to the requirements of applicable law, the committee may delegate to any person or group or subcommittee of persons (who may, but need not be members of the committee) such plan-related functions within the scope of its responsibility, power and authority as it deems appropriate. If the committee wishes to delegate a particular function to a subcommittee consisting solely of its own members, it may choose to do so on a de facto basis by limiting the members entitled to vote on matters relating to that function. Reference herein to the committee with respect to functions delegated to another person, group or subcommittee will be deemed to refer to such person, group or subcommittee.
2.4 Committee Actions. A majority of the members of the committee shall constitute a quorum. The committee may act by the vote of a majority of its members present at a meeting at which there is a quorum or by unanimous written consent. The decision of the committee as to any disputed question arising under the plan or an agreement or other document governing an individual Award, including questions of construction, interpretation and administration, shall be final and conclusive on all persons. The committee shall keep a record of its proceedings and acts and shall keep or cause to be kept such books and records as may be necessary in connection with the proper administration of the plan.
2.5 Indemnification. The Company shall indemnify and hold harmless each member of the board of directors of the committee or of any subcommittee appointed by the board of directors or the committee and any employee of the Company or any of its subsidiaries and affiliates who provides assistance with the administration of the plan or to whom a plan-related responsibility is delegated, from and against any loss, cost, liability (including any sum paid in settlement of a claim with the approval of the board of directors), damage and expense (including reasonable legal fees and other expenses incident thereto and, to the extent permitted by applicable law, advancement of such fees and expenses) arising out of or incurred in connection with the plan, unless and except to the extent attributable to such person’s fraud or willful misconduct.
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3. Limitations on Company Stock Awards Under the Plan.
3.1 Share Limitation. Subject to adjustments required or permitted by the plan, the number of shares of Common Stock available for grant under the plan shall be the sum of (a) 35,000,000 plus (b) 29,142,027, which represents the number of shares originally reserved under the plan on February 16, 2012 and of which 1,302,510 shares of Common Stock remain available for issuance under the plan as of February 28, 2021 plus (c) the number of shares of Common Stock available for awards granted under the 2005 Stock Incentive Plan, as amended and restated, that thereafter would meet the requirements of Section 3.2 herein if such awards had been granted under this plan.
3.2 Lapsed Awards. For these purposes, the following shares of Common Stock will not be taken into account and will remain available for issuance under the plan: (a) shares covered by Awards that expire or are canceled, forfeited, settled in cash or otherwise terminated, (b) shares delivered to the Company and shares withheld by the Company for the payment or satisfaction of purchase price or tax withholding obligations associated with the exercise or settlement of an Award, and (c) shares covered by stock-based awards assumed by the Company in connection with the acquisition of another company or business.
3.3 Individual Limitations.During any calendar year, the maximum aggregate grant date fair value of all Awards granted to an individual non-employee director and cash fees paid by the Company to such non-employee director outside of the plan shall not exceed $500,000.
3.4 Dividends. Any dividends, dividend equivalents or other distributions payable with respect to any Award under the plan shall be distributed to the Award holder only if, when and to the extent such underlying Award vests. The value of dividends, dividend equivalents and other distributions payable with respect to Awards that do not vest shall be forfeited.
4. Eligibility to Receive Awards. Awards may be granted under the plan to any present or future director, officer, employee, consultant or adviser of or to the Company or any of its subsidiaries. For purposes of the plan, a subsidiary is any entity in which the Company has a direct or indirect ownership interest of at least 50%. For purposes of the plan, consultant or adviser shall only include natural persons.
5. Stock Option Awards.
5.1 General. Stock options granted under the plan will have such vesting and other terms and conditions as the committee, acting in its discretion in accordance with the plan, may determine, either at the time the option is granted or, if the holder’s rights are not adversely affected, at any subsequent time. Notwithstanding the foregoing, only employees of the Company, its subsidiaries are eligible to be granted “incentive stock options” (within the meaning of Section 422 of the Internal Revenue Code of 1986 (the “Code”)) under the plan.
5.2 Minimum Exercise Price. The exercise price per share of Common Stock covered by an option granted under the plan may not be less than 100% of the fair market value per share on the date the option is granted (110% in the case of “incentive stock options” (within the meaning of Section 422 of the Code) granted to an employee who is a 10% stockholder within the meaning of Section 422(b)(6) of the Code). For purposes of the plan, unless determined otherwise by the committee, the fair market value of a share of Common Stock on any date is the closing sale price per share in consolidated trading of securities listed on the principal national securities exchange or market on which shares of Common Stock are then traded, as reported by a recognized reporting service or, if there is no sale on such date, on the first preceding date on which such shares are traded.
5.3 Limitation on Repricing of Options and SARs. Terms of outstanding Awards may not be amended to reduce the exercise price of outstanding options or SARs (as defined below) or cancel outstanding options or SARs in exchange for cash, other Awards or options or SARs with an exercise price that is less than the exercise price of the original options or SARs without stockholder approval.
5.4 Maximum Duration. Unless sooner terminated in accordance with its terms, an option granted under the plan will automatically expire on the tenth anniversary of the date it is granted or, in the case of an “incentive stock option” granted to an employee who is a 10% stockholder, the fifth anniversary of the date it is granted.
5.5 Effect of Termination of Employment or Service. The committee may establish such exercise and other conditions applicable to an option following the termination of the optionee’s employment or other service with the Company and its subsidiaries as the committee deems appropriate on a grant-by-grant basis. For purposes of the plan, an individual’s employment or service with the Company and its subsidiaries will be deemed to have terminated if such individual is no longer receiving or entitled to receive compensation for providing services to the Company and its subsidiaries.
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5.6 Method of Exercise. An outstanding and exercisable option may be exercised by transmitting to the Secretary of the Company (or other person designated for this purpose by the committee) a written notice identifying the option that is being exercised and specifying the number of whole shares to be purchased pursuant to that option, together with payment in full of the exercise price and the withholding taxes due in connection with the exercise, unless and except to the extent that other arrangements satisfactory to the Company have been made for such payment(s). The exercise price may be paid in cash or in any other manner the committee, in its discretion, may permit, including, without limitation, (a) by the delivery of previously-owned shares, (b) by a combination of a cash payment and delivery of previously-owned shares, or (c) pursuant to a cashless exercise program established and made available through a registered broker-dealer in accordance with applicable law. Any shares transferred to the Company (or withheld upon exercise) in connection with the exercise of an option shall be valued at fair market value for purposes of determining the extent to which the exercise price and/or tax withholding obligation is satisfied by such transfer (or withholding) of shares.
5.7 Non-Transferability. No option shall be assignable or transferable except upon the optionee’s death to a beneficiary designated by the optionee in a manner prescribed or approved for this purpose by the committee or, if no designated beneficiary shall survive the optionee, pursuant to the optionee’s will or by the laws of descent and distribution. During an optionee’s lifetime, options may be exercised only by the optionee or the optionee’s guardian or legal representative. Notwithstanding the foregoing, the committee may permit the inter vivos transfer of an option (other than an “incentive stock option”) pursuant to a domestic relations order (within the meaning of Rule 16a-12 promulgated under the Securities Exchange Act of 1934 (as amended)) in settlement of marital property rights, or by gift to any “family member” (within the meaning of Item A.1.(a)(5) of the General Instructions to Form S-8 or any successor provision), on such terms and conditions as the committee deems appropriate.
5.8 Rights as a Stockholder. No shares of Common Stock shall be issued in respect of the exercise of an option until payment of the exercise price and the applicable tax withholding obligations have been satisfied or provided for to the satisfaction of the Company, and the holder of an option shall have no rights as a stockholder with respect to any shares covered by the option until such shares are duly and validly issued by the Company to or on behalf of such holder.
6. Director Shares. The committee may permit non-employee directors to elect to receive all or part of their annual retainers in the form of shares (“Director Shares”). Unless the committee determines otherwise, any such elections may be made during the month a director first becomes a director and during the last month of each calendar quarter thereafter, and shall remain in effect unless and until the end of the calendar quarter in which a new election is made (or, if later, the calendar quarter next following the calendar quarter in which the director first becomes a director). Any such election shall also indicate the percentage of the retainer to be paid in shares and shall contain such other information as the committee or the board may require.
7. Stock Appreciation Rights.
7.1 General. The committee may grant stock appreciation rights (“SARs”), either alone or in connection with the grant of an option, upon such vesting and other terms and conditions as the committee, acting in its discretion in accordance with the plan, including, as applicable, Section 5 (relating to options), may determine, either at the time the SARs are granted or, if the holder’s rights are not adversely affected, at any subsequent time. Upon exercise, the holder of an SAR shall be entitled to receive a number of whole shares of Common Stock having a fair market value equal to the product of X and Y, where—
X = the number of whole shares of Common Stock as to which the SAR is being exercised, and
Y = the excess of the fair market value per share of Common Stock on the date of exercise over the fair market value per share of Common Stock on the date the SAR is granted (or such greater base value as the committee may prescribe at the time the SAR is granted).
7.2 Tandem SARs. An SAR granted in tandem with an option shall cover the same shares covered by the option (or such lesser number of shares as the committee may determine) and, unless the committee determines otherwise, shall be subject to the same terms and conditions as the related option. Upon the exercise of an SAR granted in tandem with an option, the option shall be canceled to the extent of the number of shares as to which the SAR is exercised, and, upon the exercise of an option granted in tandem with an SAR, the SAR shall be canceled to the extent of the number of shares as to which the option is exercised.
7.3 Method of Exercise. An outstanding and exercisable SAR may be exercised by transmitting to the Secretary of the Company (or other person designated for this purpose by the committee) a written notice identifying
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the SAR that is being exercised and specifying the number of shares as to which the SAR is being exercised, together with payment in full of the withholding taxes due in connection with the exercise, unless and except to the extent that other arrangements satisfactory to the Company have been made for such payment. The withholding taxes may be paid in cash or in any other manner the committee, in its discretion, may permit, including, without limitation, (a) by the delivery of previously-owned shares of Common Stock, or (b) by a combination of a cash payment and the delivery of previously-owned shares. The committee may impose such additional or different conditions for exercise of an SAR as it deems appropriate. No fractional shares will be issued in connection with the exercise of an SAR.
7.4 Rights as a Stockholder. No shares of Common Stock shall be issued in respect of the exercise of an SAR until payment of the applicable tax withholding obligations have been satisfied or provided for to the satisfaction of the Company, and the holder of an SAR shall have no rights as a stockholder with respect to any shares issuable upon such exercise until such shares are duly and validly issued by the Company to or on behalf of such holder.
8. Restricted Stock and Restricted Stock Unit.
8.1 General. Under a restricted stock award, shares of Common Stock will be issued by the Company to the recipient at the time of the Award. Under a restricted stock unit, the recipient will be entitled to receive shares of Common Stock in the future. The shares covered by a restricted stock award and the right to receive shares under a restricted stock unit will be subject to such vesting and other conditions and restrictions as the committee, acting in its discretion in accordance with the plan, may determine.
8.2 Minimum Purchase Price. Unless the committee, acting in accordance with applicable law, determines otherwise, the purchase price payable for shares of Common Stock transferred pursuant to a restricted or restricted stock unit must be at least equal to the par value of the shares.
8.3 Issuance of Restricted Stock. Shares of Common Stock issued pursuant to a restricted stock award may be evidenced by book entries on the Company’s stock transfer records pending satisfaction of the applicable vesting conditions. If a stock certificate for restricted shares is issued, the certificate will bear an appropriate legend to reflect the nature of the conditions and restrictions applicable to the shares. The Company may require that any or all such stock certificates be held in custody by the Company until the applicable conditions are satisfied and other restrictions lapse. The committee may establish such other conditions as it deems appropriate in connection with the issuance of certificates for restricted shares, including, without limitation, a requirement that the recipient deliver a duly signed stock power, endorsed in blank, for the shares covered by the Award.
8.4 Stock Certificates for Vested Stock. The recipient of a restricted stock award or a restricted stock unit will be entitled to receive a certificate, free and clear of conditions and restrictions (except as may be imposed in order to comply with applicable law), for shares that vest in accordance with the Award, subject, however, to the payment or satisfaction of applicable withholding taxes. The delivery of vested shares covered by a restricted stock unit may be deferred if and to the extent provided by the terms of the Award, subject, however, to the applicable deferral requirements of Section 409A of the Code.
8.5 Rights as a Stockholder. Subject to and except as otherwise provided by the terms of a restricted stock award, the holder of restricted shares of Common Stock will be entitled to receive dividends paid on, and exercise voting rights associated with, such shares as if the shares were fully vested; provided, however, that such dividends shall not be paid to the holder of restricted shares of Common Stock unless and until the underlying shares vest. The holder of a restricted stock unit shall have no rights as a stockholder with respect to shares covered by a restricted stock unit unless and until the Award vests and the shares are issued; provided, however, that the committee, in its discretion, may provide for the payment of dividend equivalents on shares covered by a restricted stock unit, but provided further that such dividend equivalents shall not be paid to the holder unless and until the underlying shares of Common Stock vest and are issued.
8.6 Nontransferability. Neither a restricted stock unit nor restricted shares of Common Stock issued pursuant to any such Award may be sold, assigned, transferred, disposed of, pledged or otherwise hypothecated other than to the Company or its designee in accordance with the terms of the Award or of the plan, and any attempt to do so shall be null and void and, unless the committee determines otherwise, shall result in the immediate forfeiture of the Award or the restricted shares, as the case may be.
8.7 Termination of Service Before Vesting; Forfeiture. Unless the committee determines otherwise, shares of restricted stock and non-vested restricted stock units will be forfeited upon the recipient’s termination of employment or other service with the Company and its subsidiaries. If shares of restricted stock are forfeited, any
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certificate representing such shares will be canceled on the books of the Company and the recipient will be entitled to receive from the Company an amount equal to any cash purchase price previously paid for such shares. If a non-vested restricted stock unit is forfeited, the recipient will have no further right to receive the shares of Common Stock covered by the non-vested Award.
9. Other Equity-Based Awards. The committee may grant dividend equivalent payment rights, phantom shares, bonus shares and other forms of equity-based awards to eligible persons, subject to such terms and conditions as it may establish. Awards made pursuant to this Section may entail the transfer of shares of Common Stock to the recipient or the payment in cash or otherwise of amounts based on the value of shares of Common Stock and may include, without limitation, Awards designed to comply with or take advantage of applicable tax and/or other laws, provided, that the terms and conditions of any Award that is treated as non-qualified deferred compensation must satisfy the applicable deferral requirements of Section 409A of the Code.
10. Performance Awards.
10.1 General. The committee may condition the grant, exercise, vesting or settlement of equity-based awards under the plan (whether settled in shares of Common Stock or cash or other property) on the achievement of specified performance goals as determined by the committee.
10.2 Determination of Amount Payable. Following the expiration of the performance period applicable to an Award made under this Section, the committee shall determine whether and the extent to which the performance goals have been attained and the amount of compensation, if any, that is payable as a result.
11. Capital Changes, Reorganization or Sale of the Company.
11.1 Adjustments Upon Changes in Capitalization. The aggregate number and class of shares issuable under the plan, the total number and class of shares with respect to which Awards may be granted to any individual in any calendar year, the number and class of shares and the exercise price per share covered by each outstanding option, the number and class of shares and the base price per share covered by each outstanding SAR, and the number and class of shares covered by each outstanding restricted stock unit or other-equity-based award, and any per-share base or purchase price or target market price included in the terms of any such Award, and related terms shall be subject to adjustment in order to equitably reflect the effect on issued shares of Common Stock resulting from a split-up, spin-off, recapitalization, consolidation of shares or any similar capital adjustment, and/or to reflect a change in the character or class of shares covered by the plan and an Award.
11.2 Change in Control. In the event of a Change in Control (as defined below), and except as otherwise provided by the committee in an award agreement, unvested Awards shall not vest automatically and each outstanding Award shall be treated in accordance with one or more of the following methods as determined by the committee:
(a) Awards, whether or not then vested, shall be continued, be assumed, or have new rights substituted therefor, as determined by the committee in a manner consistent with the requirements of Section 409A of the Code, and restrictions to which shares of restricted stock or any other Award granted prior to the Change in Control are subject shall not lapse upon a Change in Control and the restricted stock or other Award shall, where appropriate in the sole discretion of the committee, receive the same distribution as other shares of Common Stock on such terms as determined by the committee; provided that the committee may decide to award additional shares of restricted stock or other Awards in lieu of any cash distribution. Notwithstanding anything to the contrary herein, for purposes of incentive stock options, any assumed or substituted stock option shall comply with the requirements of Treasury Regulation Section 1.424-1 (and any amendment thereto).
(b) The committee, in its sole discretion, may provide for the purchase of any Awards by the Company for an amount of cash equal to the excess (if any) of the Change in Control Price of the shares of Common Stock covered by such Awards, over the aggregate exercise price of such Awards; provided, however, that if the exercise price of a stock option or SAR exceeds the Change in Control Price, such Award may be cancelled for no consideration.
(c) The committee may, in its sole discretion, terminate all outstanding and unexercised stock options, SARs, or any other stock-based award that provides for a holder-elected exercise, effective as of the date of the Change in Control, by delivering notice of termination to each holder at least twenty (20) days prior to the date of consummation of the Change in Control, in which case during the period from the date on which such notice of termination is delivered to the consummation of the Change in Control, each such holder shall have the right to
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exercise in full all of such holder’s Awards that are then outstanding (without regard to any limitations on exercisability otherwise contained in the award agreements), but any such exercise shall be contingent on the occurrence of the Change in Control, and, provided that, if the Change in Control does not take place within a specified period after giving such notice for any reason whatsoever, the notice and exercise pursuant thereto shall be null and void.
(d) Notwithstanding any other provision herein to the contrary, the committee may, in its sole discretion, provide for accelerated vesting
Go to www.envisionreports.com/cco or lapse of restrictions of an Award at any time.
11.3 Definition of Change in Control. For the purposes hereof, the term “Change in Control” of the Company shall be deemed to occur if (i) any “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (other than the Company, any trustee or other fiduciary holding securities under any employee benefit plan of the Company or its affiliates, or any company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of Common Stock of the Company), becoming the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of the combined voting power of the Company’s then outstanding securities, (ii) during any period of two consecutive years, individuals who at the beginning of such period constitute the Company’s board of directors, and any new director whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the Board (excluding any person whose election or nomination for election was a result of either an actual or threatened election contest as such term is used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act), (iii) a merger or consolidation of the Company or a subsidiary of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the Company or the ultimate parent company of the Company outstanding immediately after such merger or consolidation; provided, however, that a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no person (other than those covered by the exceptions in clause (i) acquires more than 50% of the combined voting power of the Company’s then outstanding securities), and (iv) a complete liquidation or dissolution of the Company or the consummation of a sale or disposition by the Company of all or substantially all of the Company’s assets other than the sale or disposition of all or substantially all of the assets of the Company to a person or persons who beneficially own, directly or indirectly, 50% or more of the combined voting power of the outstanding voting securities of the Company at the time of the sale. Notwithstanding the foregoing, with respect to any Award that is characterized as “nonqualified deferred compensation” within the meaning of Section 409A of the Code, an event shall not be considered to be a Change in Control under the Plan for purposes of payment of such Award unless such event is also a “change in ownership,” a “change in effective control” or a “change in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A of the Code.
11.5 Definition of Change in Control Price. For purposes hereof, “Change in Control Price” shall mean the amount determined in the following clause (i), (ii), (iii), (iv) or (v), whichever is applicable, as follows: (i) the price per share offered to holders of the Common Stock of the Company in any merger or consolidation, (ii) the per share fair market value of the Common Stock immediately before the Change in Control without regard to assets sold in the Change in Control and assuming the Company has received the consideration paid for the assets in the case of a sale of the assets, (iii) the amount distributed per share of Common Stock in a dissolution transaction, (iv) the price per share offered to holders of Common Stock in any tender offer or exchange offer whereby a Change in Control takes place, or (v) if such Change in Control occurs other than pursuant to a transaction described in clauses (i), (ii), (iii), or (iv) of this Section 11.5, the fair market value per share of Common Stock that may otherwise be obtained with respect to such Awards or to which such Awards track, as determined by the committee as of the date determined by the committee to be the date of cancellation and surrender of such Awards. In the event that the consideration offered to stockholders of the Company in any Change in Control consists of anything other than cash, the committee shall determine the fair cash equivalent of the portion of the consideration offered which is other than cash and such determination shall be binding on the holders of Awards to the extent applicable to Awards held by such holder.
11.6 Fractional Shares. In the event of any adjustment in the number of shares covered by any Award pursuant to the provisions hereof, any fractional shares resulting from such adjustment shall be disregarded, and each such Award shall cover only the number of full shares resulting from the adjustment.
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11.7 Determination of Board to be Final. All adjustments under this Section shall be made by the Company’s board of directors, and its determination as to what adjustments shall be made, and the extent thereof, shall be final, binding and conclusive. In addition, without limiting the foregoing, the Company’s board of directors may, in its sole discretion, make any other determination as to the treatment of Awards in connection with a Change in Control as it deems necessary, including (without limitation) that any escrow, holdback, earnout or similar provisions in the definitive documents relating to such Change in Control may apply to any payment to the holders of Awards to the same extent and in the same manner as such provisions apply to the holders of shares of Common Stock.
12. Termination and Amendment of the Plan. The board of directors of the Company may terminate the plan at any time or amend the plan at any time and from time to time; provided, however, that:
(a) no such action shall impair or adversely alter any Awards theretofore granted under the plan, except with the consent of the recipient or holder, nor shall any such action deprive any such person of any shares which he or she may have acquired through or as a result of the plan; and
(b) to the extent necessary under applicable law or the requirements of any stock exchange or market upon which the shares of Common Stock may then be listed, no amendment shall be effective unless approved by the stockholders of the Company in accordance with applicable law.
13. Miscellaneous.
13.1 Governing Law. The plan and the rights of all persons claiming under the plan shall be governed by the laws of the State of Delaware, without giving effect to conflicts of laws principles thereof.
13.2 Shares Issued Under Plan. Shares of Common Stock available for issuance under the plan may be authorized and unissued, held by the Company in its treasury or otherwise acquired for purposes of the plan. No fractional shares of Common Stock will be issued under the plan.
13.3 Compliance with Law. The Company will not be obligated to issue or deliver shares of Common Stock pursuant to the plan unless the issuance and delivery of such shares complies with applicable law, including, without limitation, the Securities Act of 1933 (as amended), the Exchange Act, and the requirements of any stock exchange or market upon which the Common Stock may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance.
13.4 Limitation of Rights. Nothing contained in the plan or in any award agreement shall confer upon any recipient of an Award any right with respect to the continuation of his or her employment or other service with the Company or a subsidiary or other affiliate, or interfere in any way with the right of the Company and its subsidiaries and other affiliates at any time to terminate such employment or other service or to increase or decrease, or otherwise adjust, the compensation and/or other terms and conditions of the recipient’s employment or other service.
13.5 Transfer Orders; Placement of Legends. All certificates for shares of Common Stock delivered under the plan shall be subject to such stock-transfer orders and other restrictions as the Company may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange or market upon which the Common Stock may then be listed, and any applicable federal or state securities law. The Company may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions.
13.6 Decisions and Determinations Final. All decisions and determinations made by the Company’s board of directors pursuant to the provisions hereof and, except to the extent rights or powers under the plan are reserved specifically to the discretion of the board of directors, all decisions and determinations of the committee, shall be final, binding and conclusive on all persons.
13.7 Withholding of Taxes. As a condition to the exercise and/or settlement of any Award or the lapse of restrictions on any Award or shares, or in connection with any other event that gives rise to a federal or other governmental tax withholding obligation on the part of the Company or a subsidiary with respect to an Award, the Company and/or the subsidiary may (a) deduct or withhold (or cause to be deducted or withheld) from any payment or distribution otherwise payable to the award recipient, whether or not such payment or distribution is covered by the plan, or (b) require the recipient to remit cash (through payroll deduction or otherwise) or make other arrangements permitted by the Company, in each case in an amount or of a nature sufficient in the opinion of the Company to satisfy or provide for the satisfaction of such withholding obligation. If the event giving rise to the withholding obligation involves a transfer of shares of Common Stock, then, at the sole discretion of the committee, the recipient may satisfy
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the withholding obligations associated with such transfer by electing to have the Company withhold shares of Common Stock or by tendering previously-owned shares of Common Stock, in each case having a fair market value equal to the amount of tax to be withheld.
13.8 Disqualifying Disposition. If a person acquires shares of Common Stock pursuant to the exercise of an incentive stock option and the shares so acquired are sold or otherwise transferred in a “disqualifying disposition” (within the meaning of Section 424(c) of the Code) within two-years from the date the option was granted or one year after the option is exercised, such person shall, within ten days of such disposition, notify the Company thereof, by delivery of written notice to the Company at its principal executive office.
13.9 Company Recoupment of Awards. An individual’s rights with respect to any Award hereunder shall in all events be subject to (i) any right that the Company may have under any Company recoupment policy or other agreement or arrangement with an individual, or (ii) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission.
13.10 Effective Date. The plan originally was effective as of February 16, 2012 and was thereafter amended effective as of March 23, 2017. This amended and restated plan is effective as of February 23, 2021 (the “Effective Date”), subject to the approval of a majority of the stockholders that are present in person or by proxy at the 2021 Annual Meeting of Stockholders. This amended and restated plan shall apply to all Awards that are granted on or after the Effective Date. The prior version of the plan shall continue to apply to any Award granted prior to the Effective Date.
14. Term of the Plan. Unless sooner terminated, the plan shall terminate on the tenth anniversary of the Effective Date. The rights of any person with respect to Awards granted under the plan that are outstanding at the time of the termination of the plan shall not be affected solely by reason of the termination of the plan and shall continue in accordance with the terms of the Awards (as then in effect or thereafter amended) and the plan.
15. Section 409A of the Code. This plan is intended to be exempt from or comply with the applicable requirements of Section 409A of the Code (“Section 409A”) and shall be limited, construed and interpreted in accordance with such intent. To the extent that any Award is subject to Section 409A, it shall be paid in a manner that will comply with Section 409A, including proposed, temporary or final regulations or any other guidance issued by the Secretary of the Treasury and the Internal Revenue Service with respect thereto. Notwithstanding anything herein to the contrary, any provision in the plan that is inconsistent with Section 409A shall be deemed to be amended to comply with Section 409A and to the extent such provision cannot be amended to comply therewith, such provision shall be null and void. For purposes of Section 409A, an individual’s right to receive any installment payments under the plan shall be treated as separate and distinct payments. Notwithstanding any contrary provision in the plan or an award agreement, any payment(s) of “nonqualified deferred compensation” (within the meaning of Section 409A ) that are otherwise required to be made under the plan to a “specified employee” (as defined under Section 409A) as a result of such employee’s separation from service (other than a payment that is not subject to Section 409A) shall be delayed for the first six (6) months following such separation from service (or, if earlier, the date of death of the specified employee) and shall instead be paid (in a manner set forth in the award agreement) upon expiration of such delay period. The Company shall have no liability to any holder or recipient of an Award or any other person if an Award that is intended to be exempt from, or compliant with, Section 409A is not so exempt or compliant or for any action taken by the committee or the Company that is inconsistent with Section 409A. In the event that any amount or benefit under this plan becomes subject to penalties under Section 409A, responsibility for payment of such penalties shall rest solely with the affected holder or recipient of the Award and not with the Company.
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Clear Channel Outdoor Holdings, Inc. 000004 ENDORSEMENT_LINE______________ SACKPACK_____________ MR A SAMPLE DESIGNATION (IF ANY) ADD 1 ADD 2 ADD 3 ADD 4 ADD 5 ADD 6 C123456789 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext Your vote matters – here’s how to vote! You may vote online or by phone instead of mailing this card. Online Go to www.envisionreports.com/cco or scan the QR code — login details are located in the shaded bar below. Phone Call toll free 1-800-652-VOTE (8683) within the USA, US territories and Canada Save paper, time and money! Sign up for electronic delivery at www.envisionreports.com/cco Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas. Annual Meeting Proxy Card 1234 5678 9012 345q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. A Proposals — The Board of Directors recommend a vote FOR all the nominees listed in Proposal 1 and FOR Proposals 2, 3, and 4. 1. Election of Directors 01 - C. William Eccleshare 02 - Lisa Hammitt 03 - Mary Teresa Rainey Mark here to vote FOR all nominees Mark here to WITHHOLD vote from all nominees For All EXCEPT - To withhold authority to vote for any nominee(s), write the name(s) of such nominee(s) below. For Against Abstain For Against Abstain 2. Approval of the advisory (non-binding) resolution on executive compensation 3. Approval of the adoption of the 2012 second amended and restated equity incentive plan Ratification of Ernst & Young LLP as the independent accounting firm for the year ending December 31, 2021 For Against Abstain q
A | Proposals – The Board of Directors recommends a vote FOR all the nominees listed in Proposal 1 and FOR Proposals 2 and 4 and EVERY ONE YEAR for Proposal 3. |
1. Election of the following director nominees: John Dionne, Lisa Hammitt, Andrew Hobson, Thomas C. King, Joe Marchese, W. Benjamin Moreland, Mary Teresa Rainey, Scott R. Wells, and Jinhy Yoon | ||||||||||||||||||||||||||||||||||||||
01 - John Dionne 04 - Thomas C. King 07 - Mary Teresa Rainey | 02 - Lisa Hammitt 05 - Joe Marchese 08 - Scott R. Wells | 03 - Andrew Hobson 06 - W. Benjamin Moreland 09 - Jinhy Yoon | ||||||||||||||||||||||||||||||||||||
☐ | Mark here to vote FOR all nominees | ☐ | Mark here to WITHHOLD vote from all nominees | ☐ | For All EXCEPT - To withhold authority to vote for any nominee(s), write the name(s) of such nominee(s) below. | |||||||||||||||||||||||||||||||||
For | Against | Abstain | 3. | Approval of the advisory (non-binding) vote on the | 1 Year | 2 Years | 3 Years | Abstain | ||||||||||||||
2. | Approval of the advisory (non-binding) resolution on executive compensation | ☐ | ☐ | ☐ | frequency of future say-on-pay votes | ☐ | ☐ | ☐ | ☐ | |||||||||||||
For | Against | Abstain | ||||||||||||||||||||
4. | Ratification of Ernst & Young LLP as the independent accounting firm for the year ending December 31, 2023 | ☐ | ☐ | ☐ |
In their discretion, the proxies are authorized to vote upon such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof.
If any other matters properly come before the meeting, the proxies will vote as recommended by our Board or, if there is no recommendation, in their discretion. B Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below
B | Authorized Signatures – This section must be completed for your vote to be counted. – Date and Sign Below |
NOTE: Please sign as name appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. C 1234567890 J N T MR A SAMPLE (THIS AREA IS SET UP TO ACCOMMODATE 140 CHARACTERS) MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND 1PCF 4 9 2 4 3 5 MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND
Date (mm/dd/yyyy) – Please print date below. | Signature 1 – Please keep signature within the box. | Signature 2 – Please keep signature within the box. | ||||||
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03RSZB |
The 20212023 Annual Meeting of Stockholders of Clear Channel Outdoor Holdings, Inc.
will be held on Wednesday May 5, 2021,3, 2023, 9:00 amA.M. Eastern Time, virtually via the internetInternet at www.meetingcenter.io/241105734. meetnow.global/MTUQGHX.
To access the virtual meeting, you must have the information that is printed in the shaded bar located on the reverse side of this form. The password for this meeting is CCO2021.
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to be held on May 5, 2021. 3, 2023.
The Proxy Statement and the Annual Report are available at: www.envisionreports.com/cco Small steps make an impact. Help the environment by consenting to receive electronic
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q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. Proxy — Clear Channel Outdoor Holdings, Inc. 2021q
2023 Meeting of Stockholders – May 5, 2021 3, 2023
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints C. William Eccleshare,Scott R. Wells, Brian D. Coleman and Lynn A. Feldman, and each of them, proxies of the undersigned with full power of substitution for and in the name, place and stead of the undersigned to appear and act for and to vote all shares of Clear Channel Outdoor Holdings, Inc. standing in the name of the undersigned or with respect to which the undersigned is entitled to vote and act at the Annual Meeting of Stockholders of said company to be held virtually at 9:00 A.M. Eastern Time on May 5, 2021,3, 2023, or at any adjournments or postponements thereof, with all powers the undersigned would possess if then personally present, as indicated on the reverse side.
THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED “FOR” THE ELECTION OF ALL THE THREE NOMINEES NAMED ON THE REVERSE SIDE AND “FOR” PROPOSALS 2 3, AND 4. (Continued4 AND “EVERY ONE YEAR” FOR PROPOSAL 3.
(Continued and to be marked, dated and signed, on the other side)
C | Non-Voting Items |
Change of Address — Please print new address below. | Comments — Please print your comments below. | |||||