Exhibit 10.2

CITADEL BROADCASTING CORPORATION

SENIOR EXECUTIVE ANNUAL BONUS PLAN

(As adopted May 22, 2007)

 

1. Purpose

This annual incentive plan (the “Plan”) is applicable to those employees of
Citadel Broadcasting Corporation (the “Company”) and its subsidiaries who are
executive officers of the Company (“Covered Employees”), including members of
the Board of Directors who are such employees.

The Plan is designed to reward, through additional cash compensation, Covered
Employees for their significant contribution toward improved profitability and
growth of the Company.

 

2. Eligibility

All Covered Employees shall be eligible to be selected to participate in this
Plan. The compensation committee or such other committee (“Committee”) as
appointed by the Board of Directors of the Company (the “Board”) shall select
the Covered Employees who shall participate in this Plan (“Participants”) in any
year no later than ninety (90) days after the commencement of the twelve
(12) month performance period selected by the Committee or such earlier or later
date as may be the applicable deadline for the establishment of performance
goals permitting the compensation payable to such Covered Employee for such year
hereunder to qualify as “qualified performance-based compensation” under
Treasury Regulation section 1.162-27(e) as applicable (the “Determination
Date”).

To the extent permitted by section 162(m) of the Internal Revenue Code of 1986,
as amended (the “Code”) a Covered Employee participating in this Plan may be
permitted to participate in any other annual incentive plan established by the
Company.

 

3. Administration

The Plan shall be administered by the Committee. The Committee shall be
comprised exclusively of members of the Board who are “outside directors” within
the meaning of section 162(m)(4)(C) Code of 1986 and Treasury Regulation section
1.162-27(e)(3). The Committee shall have the authority, subject to the
provisions herein: (a) to select Covered Employees to participate in the Plan;
(b) to establish and administer the performance goals and the award
opportunities applicable to each Participant and certify whether the goals have
been attained; (c) to construe and interpret the Plan and any agreement or
instrument entered into under the Plan; (d) to establish, amend, and waive rules
and regulations for the Plan’s administration; and (e) to make all other
determinations which may be necessary or advisable for the administration of the
Plan. Any determination by the Committee pursuant to the Plan shall be final,
binding and conclusive on all Covered Employees, Participants and anyone
claiming under or through any of them.

 

4. Establishment Of Performance Goals And Award Opportunities

No later than the Determination Date for each year, the Committee shall
establish, in writing, the method for computing the amount of compensation which
will be payable under the Plan to each Participant in the Plan for such year if
the performance goals established by the Committee for such year are attained in
whole or in part and if the Participant’s employment by the Company or a
subsidiary continues without interruption during that year as permitted by the
Plan. Such method shall be stated in terms of an objective formula or standard
that precludes discretion to increase the amount of the award that would
otherwise be due upon attainment of the goals and may be different for each
Participant. No provision of this Plan shall preclude the Committee from
exercising negative discretion with respect to any award hereunder, within the
meaning of Treasury Regulation section 1.162-27(e)(2)(iii)(A).

 

B-1

--------------------------------------------------------------------------------

No later than the Determination Date for each year, the Committee shall
establish in writing the performance goals for such year, which shall be based
on any of the following performance criteria, either alone or in any
combination, on a consolidated and/or individual business, operating unit or
divisional level, or any combination thereof, and which shall include or exclude
discontinued operations, acquisition expenses and restructuring expenses, as the
Committee may determine: earnings per share; net income; revenue growth; market
share; ratings; rank; market valuation; broadcast cash flow; free cash flow per
share; adjusted earnings before interest, taxes, and depreciation; completion of
acquisitions and business expansion; or such other criteria as specifically
outlined and detailed by the Committee. The foregoing criteria shall have any
reasonable definitions that the Committee may specify, which may include or
exclude any or all of the following items: extraordinary, unusual or
non-recurring items; effects of accounting changes; effects of currency
fluctuations; effects of financing activities (e.g., effect on earnings per
share of issuing convertible debt securities); expenses for restructuring,
productivity initiatives or new business initiatives; non-operating items;
acquisition and merger expenses; and effects of divestitures and/or mergers. Any
such performance criterion or combination of such criteria may apply to the
Participant’s award opportunity in its entirety or to any designated portion or
portions of the award opportunity, as the Committee may specify.

 

5. Maximum Award

The maximum amount of compensation that may be paid under the Plan to any
Participant for any year is $5,000,000.

 

6. Attainment Of Performance Goals Required

Awards shall be paid under this Plan for any year solely on account of the
attainment of the performance goals established by the Committee with respect to
such year. Awards may be, but are not required to be, contingent upon the
Participant remaining employed by the Company or a subsidiary of the Company
during such Plan year. In the event of termination of employment by reason of
death, disability or retirement (each as determined by the Committee) or
pursuant to a written agreement with the Company during the Plan year, an award
shall be payable under this Plan to the Participant or the Participant’s estate
for such year, which shall be paid at the same time as the award the Participant
would have received for such year had no termination of employment occurred or
in accordance with the terms of the written agreement with the Company and which
shall be equal to the amount of such award multiplied by a fraction the
numerator of which is the number of full or partial calendar months elapsed in
such year prior to termination of employment and the denominator of which is the
number twelve. Unless otherwise specified by the Committee, a Participant whose
employment terminates prior to the end of a Plan year for any reason not
excepted above shall not be entitled to any award under the Plan for that year.

 

7. Shareholder Approval And Committee Certification Contingencies: Payment Of
Awards

Payment of any awards under this Plan shall be contingent upon the affirmative
vote of the stockholders of at least a majority of the votes cast (including
abstentions) approving the Plan. Unless and until such shareholder approval is
obtained, no award shall be paid pursuant to this Plan. Subject to the
provisions of Paragraph 6 above relating to death, disability and retirement,
payment of any award under this Plan shall also be contingent upon the
compensation committee’s certifying in writing that the performance goals and
any other material terms applicable to such award were in fact satisfied, in
accordance with applicable treasury regulations under Code section 162(m).
Unless and until the Committee so certifies, such award shall not be paid.
Unless the Committee provides otherwise, (a) earned awards shall be paid
promptly following such certification, and (b) such payment shall be made in
cash (subject to any payroll tax withholding or other applicable taxes as the
Company may determine applies) or in stock compensation, as determined in the
discretion of the Company. Payment of any awards under this Plan shall be paid
within two-and-one-half (2 1/2) months of the end of the year in which the
Covered Employee vests in his or her right to receive the award.

 

B-2

--------------------------------------------------------------------------------

To the extent necessary for purposes of Code section 162(m), this Plan shall be
resubmitted to stockholders for their reapproval with respect to awards payable
for the taxable years of the Company commencing on and after the five (5) year
anniversary of initial shareholder approval.

 

8. Amendment. Termination And Term Of Plan

The Board of Directors may amend, modify or terminate this Plan at any time. The
Plan will remain in effect until terminated by the Board.

 

9. Interpretation And Construction

Any provision of this Plan to the contrary notwithstanding, (a) awards under
this Plan are intended to qualify as “qualified performance-based compensation”
under Treasury Regulation 1.162-27(e) and (b) any provision of the Plan that
would prevent an award under the Plan from so qualifying shall be administered,
interpreted and construed to carry out such intention and any provision that
cannot be so administered, interpreted and construed shall to that extent be
disregarded. No provision of the Plan, nor the selection of any eligible
employee to participate in the Plan, shall constitute an employment agreement or
affect the duration of any Participant’s employment, which shall remain
“employment at will” unless an employment agreement between the Company and the
Participant provides otherwise. Both the Participant and the Company shall
remain free to terminate employment at any time to the same extent as if the
Plan had not been adopted.

 

10. Governing Law

The terms of this Plan shall be governed by the laws of the State of Delaware,
without reference to the conflicts of laws principles thereof.

 

B-3