CUMULUS MEDIA INC.
1998 EMPLOYEE STOCK PURCHASE PLAN
1. Purpose. The purpose of this Plan is to
provide eligible employees of Cumulus Media Inc. (the
"Company") and its Subsidiaries (as defined in
Paragraph 12 hereof) (collectively, the "Employer"),
with an opportunity to purchase $.01 par value Class A
common stock of the Company (the "Class A Common
Stock") through annual offerings to be made commencing
on the 1st day of January, 1999 (the "Effective Date of
the Offering"), and thus develop a stronger incentive
to work for the continued success of the Employer. The
aggregate number of shares of Common Stock authorized
to be sold pursuant to options granted under this Plan
is 1,000,000 shares, subject to adjustment as provided
in Paragraph 17 hereof. In computing the number of
shares available for grant, any shares relating to
options which are granted, but which subsequently
lapse, are canceled, or are otherwise not exercised by
the final date for exercise, shall be deemed available
for future grants of options. The Plan is intended to
qualify as an "employee stock purchase plan" under
Section 423 of the Internal Revenue Code of 1986, as
amended (the" Code") and, therefore, the provisions of
the Plan shall be construed so as to govern
participation in a manner consistent with the
requirements of Section 423(b) of the Code.
2. Administration. The Plan shall be
administered by the Compensation Committee of the Board
of Directors of the Company (the "Committee"). Any
expenses of the Committee shall be paid by the Company.
The Committee may adopt regulations not inconsistent
with the provisions of this Plan for the administration
thereof, and its interpretation and construction of the
Plan and the regulations shall be final, conclusive and
binding on all participants in the Plan.
3. Eligibility.
(a) All employees of the Employer will be
eligible to participate in the Plan, provided they
have a minimum period of continuous service with
the Employer of six (6) months as of the Effective
Date of the Offering, subject to the additional
limitations imposed herein.
(b) Any provision of this Plan to the
contrary notwithstanding, no employee shall be
granted an option:
(i) if, immediately after the grant,
such employee would own, and/or hold
outstanding options to purchase stock
possessing 5% or more of the total combined
voting power or value of all classes of stock
of the Company or of any parent or Subsidiary
of the Company as provided in Section
423(b)(3) of the Code; or
(ii) which permits the employee's
rights to purchase stock under all employee
stock purchase plans, as defined in Section
423 of the Code, of the Company and any
parent or Subsidiaries to accrue at a rate
which exceeds $25,000 of Fair Market Value of
the stock (determined at the time such option
is granted) for each calendar year in which
such stock option is outstanding at any time
as provided in Section 423(b)(8) of the Code.
4. Offerings. The Board of Directors of the
Company may authorize the Committee to make one or more
annual offerings to employees (through the grant of
options) to purchase Common Stock under this Plan. The
term of any offering shall be for a period of twelve
(12) months' duration.
5. Participation. An employee eligible on the
Effective Date of any Offering (as defined in paragraph
1 hereof) may participate in such offering by
completing and forwarding a payroll deduction
authorization form to his appropriate payroll location
before August 1st of the offering period. The form
will authorize a regular payroll deduction from the
employee's pay.
6. Deductions. The Employer will maintain
payroll deduction accounts for all participating
employees. With respect to any offering made under
this Plan, an employee may authorize a payroll
deduction in terms of whole number percentages up to a
maximum of 15% of the compensation an employee received
during the offering period (or during such portion
thereof as an employee may elect to participate).
7. Deduction Changes. An employee may increase
or decrease his payroll deduction by filing a new
payroll deduction authorization form before August 1st
of the offering period except in the case of the first
offering where no increase or decrease in the amount
withheld may be made. The change may not become
effective sooner than the next pay period after receipt
of the form. A payroll deduction may be increased only
once and reduced only once during the term of any
offering period.
8. Withdrawal of Funds. Upon written notice to
the Committee, an employee may at any time and for any
reason permanently draw out the balance accumulated in
his account, and thereby withdraw from participation in
an offering. The only right of an employee withdrawing
from an offering shall be to be paid the entire amount
credited to his account. He may thereafter begin
participating again only once, provided it is before
August 1st, during the remainder of the offering
period. Partial withdrawals will not be permitted.
9. Purchase of Shares.
(a) Each employee participating in an
offering under this Plan will be granted an
option, upon the Effective Date of the Offering,
to purchase as many whole shares of Common Stock
of the Company as can be purchased with the total
payroll deductions credited to his account during
the specified offering period in the manner and on
the terms herein provided.
(b) The purchase price for a share granted
under any offering will be the Offering Price of
85% of the average of the Fair Market Value (as
defined in Section 12 hereof) of a share of Class
A Common Stock on the Effective Date of the
Offering and December 31 of the year which
includes the Effective Date of the Offering,
provided, however, that the purchase price shall
not be less than par value. For example, if the
Fair Market Value of the Class A Common Stock on
January 1, 1999 is $18 per share and the Fair
Market Value on December 31, 1999 is $24 per
share, the Offering Price of the Offering shall be
$17.85 per share (($18 + $24)/2) x 85%.
(c) As of December 31st of each year, the
account of each participating employee shall be
totaled and the Offering Price determined. If a
participating employee shall have sufficient funds
in his account to purchase one or more full shares
at the Offering Price as of that date, the
employee shall be deemed to have exercised his
option to purchase such share or shares at such
price, his account shall be charged for the amount
of the purchase and a stock certificate shall be
issued to him as of such day. The balance of any
payroll deductions credited to his account during
the offering shall be returned to the
participating employee.
10. Interest. Interest will not accrue on any
employee payroll deduction accounts.
11. Registration of Certificates. Certificates
will be registered only in the name of the employee.
If an employee makes a written request to the
Committee, the Committee may cause the certificates to
be issued in his name jointly with a member of his
family with right of survivorship.
12. Definitions
(a) "Fair Market Value" shall be the closing
sale price of the Common Stock of the Company on
the NASDAQ National Market System (the
"NASDAQ/NMS") as reported in the Midwest Edition
of The Wall Street Journal on the date in
question, provided that, if no sales of Common
Stock of the Company were made on the NASDAQ/NMS
on any such date, Fair Market Value shall mean the
closing sale price of the Common Stock of the
Company as reported for the most recent preceding
day on which sales of Common Stock were made on
the NASDAQ, or, failing any such sales, such other
price as the Committee may determine in conformity
with pertinent law and regulations of the Treasury
Department.
(b) "Subsidiary" means any corporation of
which the Company or a Subsidiary owns 50% or more
of the combined voting power of all classes of
stock unless the Board determines that such
corporation shall not be a "Subsidiary" for
purposes hereof. Only subsidiaries that satisfy
the requirements of Section 424(f) of the Code
shall be entitled to participate in the Plan.
13. Rights as a Shareholder. None of the rights
or privileges of a shareholder of the Company shall
exist with respect to shares purchased under this Plan
unless and until such full shares shall have been duly
issued.
14. Rights on Retirement, Death, or Termination
of Employment. In the event of a participating
employee's retirement, death, or termination of
employment, no payroll deduction shall be taken from
any pay due and owing to him at such time and the
balance in his account shall be paid to him or, in the
event of his death, to his estate. Transfer of a
participating employee from the Company to a parent or
Subsidiary thereof or vice versa shall not constitute
termination of employment.
15. Rights Not Transferable. Rights under this
Plan are not transferable by a participating employee,
otherwise than by will or the laws of descent and
distribution, and are exercisable, during his lifetime,
only by him. In addition, rights under the Plan may
not be subject to any attachment, garnishment or
encumbrance of any kind by creditors of the
participating employee.
16. Application of Funds. All funds received or
held by the Company under this Plan may be used for any
corporate purpose and need not be segregated.
17. Adjustment in Case of Changes Affecting the
Common Stock of the Company. In the event of any stock
dividend, split-up, recapitalization, merger,
consolidation, combination or exchange of shares, or
the like, as a result of which shares of any class
shall be issued in respect of the outstanding Common
Stock, or the Common Stock shall be changed into the
same or different number of the same or another class
of stock, or into securities of another person, cash or
other property (not including a regular cash dividend),
the total number of shares authorized to be offered in
accordance with Paragraph 1, the number of shares
subject to each outstanding option, the option price
applicable to each such option, and/or the
consideration to be received upon exercise of each such
option shall be adjusted in a fair and reasonable
manner by the Committee. In addition, the Committee
shall, in its sole discretion, have authority to
provide, in appropriate cases, for (i) acceleration of
the exercise date of outstanding options, or (ii) the
conversion of outstanding options into cash or other
property to be received in certain of the transactions
specified in the preceding sentence upon effectiveness
of such transactions.
18. Amendment of the Plan.
(a) The Board of Directors of the Company
may at any time, or from time to time, amend this
Plan in any respect; provided, however, that no
amendment shall be made without the approval of
the shareholders of the Company to increase the
aggregate number of shares which may be issued
under this Plan (other than as provided in
Paragraph 17 hereof) or for which shareholder
approval is required under applicable tax,
securities or other laws.
(b) In the event that the Board of Directors
determines that the ongoing operation of the Plan
may result in unfavorable financial accounting
consequences, the Board of Directors may, in its
discretion and, to the extent necessary or
desirable, amend the Plan to reduce or eliminate
such accounting consequence including, but not
limited to:
(i) altering the purchase price for any
offering period including an offering period
underway at the time of the change in
purchase price;
(ii) shortening any offering period
such that the offering period ends on a new
exercise date, including an offering period
underway at the time of the action of the
Board of Directors; and
(iii) allocating shares.
Such amendments shall be made without the approval of
the shareholders of the Company or the consent of any
participating employees.
19. Termination of the Plan.
(a) This Plan and all rights of employees
under any offering hereunder shall terminate:
(i) on the day that participating
employees become entitled to purchase a
number of shares equal to or greater than the
number of shares remaining available for
purchase. If the number of shares so
purchasable is greater than the shares
remaining available, the available shares
shall be allocated by the Committee among
such participating employees in such manner
as it deems fair and consistent with Section
423 of the Code; or
(ii) at any time, at the discretion of
the Board of Directors of the Company.
(b) Upon termination of this Plan, all
amounts in the accounts of participating employees
shall be either (i) promptly refunded in total or
(ii) refunded to the extent not used to purchase
shares of Class A Common Stock, in the sole
discretion of the Board of Directors of the
Company.
20. Governmental Regulations. The obligation to
sell and deliver shares of the Class A Common Stock
under this Plan is subject to the approval of any
governmental authority required in connection with the
authorization, issuance, or sale of such stock.