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EXHIBIT 4.1
CUMULUS MEDIA INC.
1999 STOCK INCENTIVE PLAN
1. OBJECTIVES. The Cumulus Media Inc. 1999 Stock Incentive Plan
is designed to attract and retain certain selected officers, key employees,
non-employee directors and consultants whose skills and talents are important to
the Company's operations, and reward them for making major contributions to the
success of the Company. These objectives are accomplished by making awards under
the Plan, thereby providing Participants with a proprietary interest in the
growth and performance of the Company.
2. DEFINITIONS.
(a) "Award" shall mean the grant of a Stock Option to a
Plan Participant pursuant to such terms, conditions, performance
requirements, and limitations as the Committee may establish in order
to fulfill the objectives of the Plan.
(b) "Award Agreement" shall mean an agreement between
Cumulus Media Inc. and a Participant that sets forth the terms,
conditions, performance requirements, and limitations applicable to an
Award.
(c) "Board" shall mean the Board of Directors of Cumulus
Media Inc.
(d) "Cause" shall mean termination of a Participant's
employment with the Company for (i) any failure of the Participant to
substantially perform his duties with the Company (other than by reason
of illness) which occurs after the Company has delivered to the
Participant a demand for performance which specifically identifies the
manner in which the Company believes the Participant has failed to
perform his duties, and the Participant fails to resume performance of
his duties on a continuous basis within 14 days after receiving such
demand, (ii) the commission by the Participant of any act of dishonesty
or disloyalty involving the Company or its business, or (iii) the
conviction of the Participant of a felony or misdemeanor which, in the
reasonable judgment of the Committee, is substantially related to the
employee's position with the Company or substantially impairs the
Participant's ability to perform his duties with the Company.
(e) "Change in Control" shall mean any of the following
events:
(i) the acquisition by an individual, entity or
group (within the meaning of Section 13(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act") (a "Person"), after the date hereof, of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of 35% or more of either (a) the then
outstanding shares of common stock of Cumulus Media Inc. (the
"Outstanding Company Common Stock") or (b) the combined voting
power of the then outstanding voting securities of Cumulus
Media Inc. entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities");
provided, however, that for purposes of this subsection (i),
the following acquisitions shall not constitute a Change of
Control: (a) any acquisition directly from Cumulus Media Inc.,
(b) any acquisition by the Company, (c) any acquisition by any
employee benefit plan (or related trust) sponsored or
maintained by the Company, or (d) any acquisition by any
corporation pursuant to a transaction which complies with
clauses (a), (b) and (c) of subsection (iii) of this Section
2(e); or
(ii) individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any
reason to constitute at least a majority of the Board;
provided, however, that any individual becoming a director
subsequent to the date hereof whose election, or nomination
for election by Cumulus Media Inc.'s shareholders, was
approved by a vote of at least a majority of the directors
then constituting the Incumbent Board shall be considered as
though such individual were a member of the Incumbent Board,
but excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of an actual
or
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threatened election contest with respect to the election or
removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a
person other than the Board; or
(iii) consummation of a reorganization, merger or
consolidation or sale or other disposition of all or
substantially all of the assets of the Company for which
approval of the shareholders of Cumulus Media Inc. is required
(a "Business Combination"), in each case, unless, immediately
following such Business Combination, (a) all or substantially
all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Common Stock
and Outstanding Company Voting Securities immediately prior to
such Business Combination beneficially own, directly or
indirectly, more than 60% of, respectively, the then
outstanding shares of common stock and the combined voting
power of the then outstanding voting securities entitled to
vote generally in the election of directors, as the case may
be, of the corporation resulting from such Business
Combination (including, without limitation, a corporation
which as a result of such transaction owns Cumulus Media Inc.
or all or substantially all of the Company's assets either
directly or through one or more subsidiaries) in substantially
the same proportions as their ownership, immediately prior to
such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case
may be, (b) no Person (excluding any employee benefit plan (or
related trust) of the Company or such corporation resulting
from such Business Combination) beneficially owns, directly or
indirectly, 35% or more of, respectively, the then outstanding
common stock of the corporation resulting from such Business
Combination or the combined voting power of the then
outstanding voting securities of such corporation except to
the extent that such ownership existed prior to the Business
Combination and (c) at least a majority of the members of the
Board of Directors of the corporation resulting from such
Business Combination were members of the Incumbent Board at
the time of the execution of he initial agreement, or of the
action of the Board, providing for such Business Combination;
or
(iv) approval by the shareholders of Cumulus
Media Inc. of a complete liquidation or dissolution of Cumulus
Media Inc.
(f) "Class A Common Stock" shall mean the authorized and
issued or unissued $.01 par value Class A common stock of Cumulus Media
Inc.
(g) "Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time.
(h) "Committee" shall mean the Compensation Committee of
the Board of Directors of Cumulus Media Inc. which shall be comprised
of at least two non-employee directors.
(i) "Company" shall mean Cumulus Media Inc. and its
subsidiaries including subsidiaries of subsidiaries and partnerships
and other business ventures in which Cumulus Media Inc. has a
significant equity interest, as determined in the sole discretion of
the Committee.
(j) "Fair Market Value" shall mean the closing sale price
of the Class A Common Stock on the Nasdaq National Market as reported
in the Midwest Edition of the Wall Street Journal for the date in
question, provided that, if no sales of Class A Common Stock were made
on said exchange on that date, "Fair Market Value" shall mean the
closing sale price of Class A Common Stock as reported for the most
recent preceding day on which sales of Class A Common Stock were made
on such exchange, or, failing any such sales, such other price as the
Committee may determine in conformity with pertinent law and
regulations of the Treasury Department. Notwithstanding the foregoing,
in the case of Awards which are effective on the date the Company sells
shares of Class A Common Stock in an underwritten public offering, Fair
Market Value shall mean the price per share at which the Class A Common
Stock is initially sold to the public pursuant to the offering.
(k) "Participant" shall mean a current or prospective
employee, non-employee director, consultant or other person who
provides services to the Company to whom an Award has been made under
the Plan. Notwithstanding the foregoing, if a director is serving on
the Board to represent the interests of a corporate
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shareholder of the Company, the option which otherwise would be awarded
to the director may be awarded to the director's employer.
(l) "Plan" shall mean the Cumulus Media Inc. 1999 Stock
Incentive Plan.
(m) "Retirement" shall mean termination of employment
with the Company or service as a member of the Board on or after the
attainment of age 65.
(n) "Stock Option" shall mean a grant of a right to
purchase a specified number of shares of Class A Common Stock, the
purchase price of which shall be not less than 100% of Fair Market
Value on the date of grant. A stock option may be in the form of a
nonqualified stock option or an incentive stock option ("ISO"). A
nonqualified stock option is an option that does not meet the criteria
of an ISO. An ISO, in addition to being subject to applicable terms,
conditions and limitations established by the Committee, complies with
Section 422 of the Code which, among other limitations, provides that
the aggregate Fair Market Value (determined at the time the option is
granted) of Class A Common Stock for which ISOs are exercisable for the
first time by a Participant during any calendar year shall not exceed
$100,000; that ISOs shall be priced at not less than 100% of the Fair
Market Value on the date of the grant (110% in the case of a
Participant who is a 10% shareholder of the Company within the meaning
of Section 422 of the Code); and that ISOs shall be exercisable for a
period of not more than ten years (five years in the case of a
Participant who is a 10% shareholder of the Company).
3. ELIGIBILITY. Current and prospective employees, non-employee
directors, consultants or other persons who provide services to the Company
eligible for an Award under the Plan are those who hold, or will hold, positions
of responsibility and whose performance, in the judgment of the Committee or the
management of the Company (if such responsibility is delegated pursuant to
Section 6 hereof), can have a significant effect on the success of the Company.
4. COMMON STOCK AVAILABLE FOR AWARDS. Subject to adjustment as
provided in Section 14 hereof, the number of shares that may be issued under the
Plan for Awards during the term of the Plan is 900,000 shares of Class A Common
Stock, all of which may be in the form of incentive stock options. Any shares
subject to an Award which are used in settlement of tax withholding obligations
shall be deemed not to have been issued for purposes of determining the maximum
number of shares available for issuance under the Plan. Likewise, if any Stock
Option is exercised by tendering shares, either actually or by attestation, to
the Company as full or partial payment for such exercise under this Plan, only
the number of shares issued net of the shares tendered shall be deemed issued
for purposes of determining the maximum number of shares available for issuance
under the Plan. No individual shall be eligible to receive Awards aggregating
more than 300,000 shares of Class A Common Stock reserved under the Plan in any
one calendar year, subject to adjustment as provided in Section 14 hereof.
Cumulus Media Inc. shall take whatever actions are necessary to file required
documents with the U.S. Securities and Exchange Commission and any other
appropriate governmental authorities and stock exchanges to make shares of Class
A Common Stock available for issuance pursuant to Awards.
5. ADMINISTRATION. The Plan shall be administered by the
Committee, which shall have full and exclusive power to interpret the Plan, to
determine which current and prospective employees, non-employee directors and
consultants are Plan Participants, to grant waivers of Award restrictions, to
determine the provisions of Award Agreements and to adopt such rules,
regulations and guidelines for carrying out the Plan as it may deem necessary or
proper, all of which powers shall be executed in the best interests of the
Company and in keeping with the objectives of the Plan.
6. DELEGATION OF AUTHORITY. Except to the extent prohibited by
applicable law or the applicable rules of a stock exchange, the Committee may
delegate to the chief executive officer and to other senior officers of the
Company its duties under the Plan pursuant to such conditions or limitations as
the Committee may establish. Any such delegation may be revoked by the Committee
at any time.
7. AWARDS. The Committee shall set forth in the related Award
Agreement the terms, conditions, performance requirements, and limitations
applicable to each Award including, but not limited to, continuous service with
the
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Company, conditions under which acceleration of vesting will occur and
achievement of specific business objectives.
8. DEFERRED PAYMENT OF AWARDS. The Committee may permit selected
Participants to elect to defer payment of Awards in accordance with procedures
established by the Committee which are intended to permit such deferrals to
comply with applicable requirements of the Code including, at the choice of
Participants, the capability to make further deferrals for payment after
retirement. Dividends or dividend equivalent rights may be extended to and made
part of any Award denominated in stock, subject to such terms, conditions and
restrictions as the Committee may establish. The Committee may also establish
rules and procedures for the crediting of dividend equivalents for deferred
payments denominated in stock.
9. STOCK OPTION EXERCISE. The price at which shares of Class A
Common Stock may be purchased under a Stock Option shall be paid in full at the
time of the exercise in cash or, if permitted by the Committee, by means of
tendering shares of Class A Common Stock, which have been held by the
Participant for more than six months and have not been used within the prior
six-month period to exercise an option, either directly or by attestation,
valued at Fair Market Value on the date of exercise, or any combination thereof.
10. TAX WITHHOLDING. The Company shall have the right to deduct
applicable taxes from any Award payment and withhold, at the time of delivery or
vesting of shares under the Plan, an appropriate number of shares for payment of
taxes required by law or to take such other action as may be necessary in the
opinion of the Company to satisfy all obligations for withholding of such taxes.
The Company may defer making delivery with respect to Class A Common Stock
obtained pursuant to an Award hereunder until arrangements satisfactory to it
have been made with respect to any such withholding obligation. If Class A
Common Stock is used to satisfy tax withholding, such stock shall be valued
based on the Fair Market Value when the tax withholding is required to be made.
11. AMENDMENT OR TERMINATION OF THE PLAN. The Board may, at any
time, but only with unanimous consent or approval, amend or terminate the Plan;
provided, however, that
(a) subject to Section 14 hereof, no amendment or
termination may, in the absence of written consent to the change by the
affected Participant (or, if the Participant is not then living, the
affected beneficiary), adversely affect the rights of any Participant
or beneficiary under any Award granted under the Plan prior to the date
such amendment is adopted by the Board; and
(b) without further approval of the shareholders of the
Company, no amendment shall increase the number of shares of Class A
Common Stock which may be delivered pursuant to Awards hereunder,
except for increases resulting from Section 14 hereof.
12. TERMINATION OF EMPLOYMENT. If the employment of a Participant
terminates, or a non-employee director no longer serves on the Board, other than
pursuant to paragraphs (a) through (c) of this Section 12, all unvested Awards
shall immediately terminate and all vested but unexercised, deferred or unpaid
Awards shall terminate 90 days after such termination of employment or service,
unless the Award Agreement provides otherwise, and during such 90-day period
shall be exercisable only to the extent provided in the Award Agreement.
Notwithstanding the foregoing, if a Participant's employment is terminated for
Cause, to the extent the Award is not effectively exercised or has not vested
prior to such termination, it shall lapse or be forfeited to the Company
immediately upon termination. In all events, an Award will not be exercisable
after the end of its term as set forth in the Award Agreement.
(a) Retirement. When a Participant's employment or
service terminates as a result of Retirement, or early retirement with
the consent of the Committee, the Committee (in the form of an Award
Agreement or otherwise) may permit Awards to continue in effect beyond
the date of Retirement, or early retirement, and/or the exercisability
and vesting of any Award may be accelerated.
(b) Resignation in the Best Interests of the Company.
When a Participant resigns from the Company or the Board and, in the
judgment of the Committee, the acceleration and/or continuation of
outstanding Awards would be in the best interests of the Company, the
Committee may (i) authorize, where appropriate, the acceleration
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and/or continuation of all or any part of Awards granted prior to such
termination and (ii) permit the exercise, vesting and payment of such
Awards for such period as may be set forth in the applicable Award
Agreement.
(c) Death or Disability of a Participant.
(i) In the event of a Participant's death, the
Participant's estate or beneficiaries shall have a period
specified in the Award Agreement within which to receive or
exercise any outstanding Award held by the Participant under
such terms, and to the extent, as may be specified in the
applicable Award Agreement. Rights to any such outstanding
Awards shall pass by will or the laws of descent and
distribution in the following order: (a) to beneficiaries so
designated by the Participant; if none, then (b) to a legal
representative of the Participant; if none, then (c) to the
persons entitled thereto as determined by a court of competent
jurisdiction. Subject to subparagraph (iii) below, Awards so
passing shall be exercised or paid out at such times and in
such manner as if the Participant were living.
(ii) In the event a Participant is deemed by the
Company to be disabled within the meaning of Cumulus Media
Inc.'s group long-term disability plan, or if Cumulus Media
Inc. does not have such a plan, Section 22(e)(3) of the Code,
the Award shall be exercisable for the period, and to the
extent, specified in the Award Agreement. Awards and rights to
any such Awards may be paid to or exercised by the
Participant, if legally competent, or a legally designated
guardian or representative if the Participant is legally
incompetent by virtue of such disability.
(iii) After the death or disability of a
Participant, the Committee may in its sole discretion at any
time (1) terminate restrictions in Award Agreements and (2)
accelerate any or all installments and rights.
(iv) In the event of uncertainty as to
interpretation of or controversies concerning this paragraph
(c) of Section 12, the Committee's determinations shall be
binding and conclusive.
(d) No Employment Rights. The Plan shall not confer upon
any Participant any right with respect to continuation of employment by
the Company or service on the Board, nor shall it interfere in any way
with the right of the Company to terminate any Participant's employment
or service on the Board at any time.
13. NONASSIGNABILITY. Except as provided in subsection (c) of
Section 12 and this Section 13, no Award under the Plan shall be assignable or
transferable, or payable to or exercisable by anyone other than the Participant
to whom it was granted. Notwithstanding the foregoing, the Committee (in the
form of an Award Agreement or otherwise) may permit Awards, other than incentive
stock options within the meaning of Section 422 of the Code, to be transferred
to members of the Participant's immediate family, to trusts for the benefit of
the Participant and/or such immediate family members, and to partnerships or
other entities in which the Participant and/or such immediate family members own
all the equity interests. For purposes of the preceding sentence, "immediate
family" shall mean a Participant's spouse, issue, and spouses of his issue.
14. ADJUSTMENTS. In the event of any change in the outstanding
Class A Common Stock of the Company by reason of a stock split, stock dividend,
combination or reclassification of shares, recapitalization, merger, or similar
event, the Committee may adjust proportionally (a) the number of shares of Class
A Common Stock (i) reserved under the Plan, (ii) available for ISOs, (iii) for
which Awards may be granted to an individual Participant, and (iv) covered by
outstanding Awards denominated in stock; (b) the stock prices related to
outstanding Awards; and (c) the appropriate Fair Market Value and other price
determinations for such Awards. In the event of any other change affecting the
Class A Common Stock or any distribution (other than normal cash dividends) to
holders of Class A Common Stock, such adjustments as may be deemed equitable by
the Committee, including adjustments to avoid fractional shares, shall be made
to give proper effect to such event. In the event of a corporate merger,
consolidation, acquisition of property or stock, separation, reorganization or
liquidation, the Committee shall be authorized to issue or assume Stock Options,
whether or not in a transaction to which Section 424(a) of the Code applies, by
means of substitution of new Stock Options for previously issued Stock Options
or an assumption of previously issued Stock Options.
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15. NOTICE. Any notice to the Company required by any of the
provisions of the Plan shall be addressed to the director of finance of the
Company in writing, and shall become effective when it is received by his
office.
16. UNFUNDED PLAN. The Plan shall be unfunded. Although
bookkeeping accounts may be established with respect to Participants who are
entitled to cash, Class A Common Stock or rights thereto under the Plan, any
such accounts shall be used merely as a bookkeeping convenience. The Company
shall not be required to segregate any assets that may at any time be
represented by cash, Class A Common Stock or rights thereto, nor shall the Plan
be construed as providing for such segregation, nor shall the Company nor the
Board nor the Committee be deemed to be a trustee of any cash, Class A Common
Stock or rights thereto to be granted under the Plan. Any liability of the
Company to any Participant with respect to a grant of cash, Class A Common Stock
or rights thereto under the Plan shall be based solely upon any contractual
obligations that may be created by the Plan and any Award Agreement; no such
obligation of the Company shall be deemed to be secured by any pledge or other
encumbrance on any property of the Company. Neither the Company nor the Board
nor the Committee shall be required to give any security or bond for the
performance of any obligation that may be created by the Plan.
17. GOVERNING LAW. The Plan and all determinations made and
actions taken pursuant hereto, to the extent not otherwise governed by the laws
of the United States, shall be governed by the laws of the State of Wisconsin,
without giving effect to principles of conflicts of laws, and construed
accordingly.
18. EFFECTIVE AND TERMINATION DATES. The effective date of the
Plan is August 30, 1999. The Plan shall terminate on August 30, 2009 subject to
earlier termination by the Board pursuant to Section 11, after which no Awards
may be made under the Plan, but any such termination shall not affect Awards
then outstanding or the authority of the Committee to continue to administer the
Plan.
19. OTHER BENEFIT AND COMPENSATION PROGRAMS. Payments and other
benefits received by a Participant pursuant to an Award shall not be deemed a
part of such Participant's regular, recurring compensation for purposes of the
termination, indemnity or severance pay law of any country and shall not be
included in, nor have any effect on, the determination of benefits under any
other employee benefit plan, contract or similar arrangement, unless the
Committee expressly determines otherwise.
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