With shareholders set to vote September 15th on selling the company to Cumulus Media, Citadel Broadcasting has updated its tabulation of the severance packages that top executives are due to receive when the deal closes. The new tally is not only way bigger than the company’s previous estimate, which was based on December 31, 2010 values, but even bigger than the calculation made by RBR-TVBR in July.
Citadel’s updated proxy material filed with the SEC says it intends to pay pro-rated annual bonuses to its top execs when they are terminated, with the pro-ration to be based on the number of days they were employed this year before the merger into Cumulus is completed. The amounts of the annual pro-rated bonuses are: $910,000 for CEO Farid Suleman; $91,000 each for COO Judy Ellis, CFO Randy Taylor and SVP/General Counsel Hilary Glassman; and $57,000 for SVP/Finance & Administration Patricia Stratford.
The new calculation by the company uses the stated value of $37 per share for the cash/stock acquisition by Cumulus, although that will vary somewhat based on the actual stock price for Cumulus Media on the closing date.
Suleman is now in line to receive $10,751,000 in cash compensation from Citadel, $13,491,154 in cash and stock for his stock and options, $12,954,947 in “pension and non-qualified deferred compensation,” and $39,043 in perquisites and benefits (P&B) for a total of $37,236,144.
Ellis is set to receive $1,525,000 in cash, $1,560,668 for her stock and options, and $27,211 in P&B for a total of $3,112,879.
Taylor is due $1,315,000 in cash, $1,085,735 for his stock and options, and $39,043 in P&B for a total of $2,971,361.
Glassman, who was only hired in February 2011, is in line to receive $705,000 in cash, $307,000 for her stock and options, and $12,974 in P&B for a total of $1,087,974.
Stratford is to receive severance payments of $720,000 in cash, $880,186 for her stock and options, and $37,091 in P&B for a total of $1,637,277.
In total the five Citadel execs are estimated to receive slightly over $46 million in golden parachute payments when the sale to Cumulus Media closes.
RBR-TVBR observation: In addition to voting on approval of the deal with Cumulus Media, one of the items Citadel shareholders will vote on September 15th is whether to approve the golden parachute packages for four of the five execs (Glassman is not a “named executive officer” of the company). However, that vote is only advisory and not binding on the Citadel board of directors, which is also about to exit with the closing.
Suleman: Not a bad pay out for a guy who did not want to sell.
The radio business only hopes that Dickey and Cumulus will be the leader the radio medium has been looking for to get the business of radio back on the upward track. Analog is fine but Digital is the future and the future is now. Technology waits for No One.