| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On November 13, 2018, the Compensation Committee (the “iHeartMedia Compensation Committee”) of the Board of Directors of iHeartMedia, Inc. (“iHeartMedia”), the indirect parent of Clear Channel Outdoor Holdings, Inc. (the “Company”), approved the terms and conditions governing the iHeartMedia 2019 Key Incentive Bonus Plan (the “2019 KEIP”) and quarterly bonus opportunities for the first, second, third and fourth quarters of 2019 for certain key employees of iHeartMedia, who are also executive officers of the Company. The 2019 KEIP and the quarterly bonus opportunities described below are subject to approval by the United States Bankruptcy Court for the Southern District of Texas.
Under the 2019 KEIP, each participant is eligible to earn a performance bonus in cash at the end of each of the first, second, third and fourth quarters of 2019 (the “Quarterly Bonuses”), depending upon the extent to which iHeartMedia’s OIBDAN goal has been achieved for each such quarter. In addition to being measured on a quarterly basis, iHeartMedia’s OIBDAN goal will be measured cumulatively through the end of each of the second, third and fourth quarters of 2019 and a participant will be eligible to earn, in addition to the Quarterly Bonuses for the second, third and fourth quarters, an amount equal to the Quarterly Bonuses based on achievement of the cumulative iHeartMedia OIBDAN goal minus the Quarterly Bonuses actually paid for each such quarter. In order to earn a Quarterly Bonus for any quarter, a participant must generally remain employed by iHeartMedia through the end of the applicable quarter. A participant whose employment with iHeartMedia terminates due to death or disability or by iHeartMedia without “cause” or by the participant for “good reason” prior to the end of the applicable quarter will receive apro-rated portion of the bonus that would otherwise have been earned for that quarter. iHeartMedia, in its sole discretion, has the right to amend or terminate this Plan at any time; provided that in no event shall any amendment or termination adversely affect the rights of the participants regarding any Quarterly Bonus for a quarter that has commenced as of the date of such action without the prior written consent of the affected participants.
The iHeartMedia Compensation Committee approved the following Quarterly Bonus opportunities under the 2019 KEIP for the following named executive officers:
Robert W. Pittman, Chief Executive Officer, will be eligible to earn a target Quarterly Bonus for each of the first, second, third and fourth quarters of 2019 of $2,325,000.
Richard J. Bressler, President, Chief Operating Officer and Chief Financial Officer, will be eligible to earn a target Quarterly Bonus for each of the first, second, third and fourth quarters of 2019 of $1,325,000.
Steven J. Macri, Senior Vice President, Corporate Finance, will be eligible to earn a target Quarterly Bonus for each of the first, second, third and fourth quarters of 2019 of $275,000.
Pursuant to the Corporate Services Agreement between the Company and iHeartCommunications, Inc., a subsidiary of iHeartMedia, a portion of the Quarterly Bonuses payable to Messrs. Bressler and Macri will be allocated to the Company based on the Company’s OIBDAN (as defined below) as a percentage of iHeartMedia’s OIBDAN for the prior year, each as reported in connection withyear-end financial results. For purposes of these allocations, OIBDAN is defined as: consolidated net income (loss) adjusted toexclude non-cash compensation expenses and amortization of deferred system implementation costs as well as the following line items presented in the Statement of Operations: income tax benefit (expense); other income (expense), net; equity in earnings (loss) of nonconsolidated affiliates; interest expense; interest income on the Due from iHeartCommunications Note; other operating income, net; depreciation and amortization; and impairment charges. Mr. Pittman’s compensation is paid by iHeartMedia and is not allocated to the Company.
