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As filed with the Securities and Exchange Commission on July 12, 2011
Registration No. 333-      
 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
CUMULUS MEDIA INC.
(Exact name of registrant as specified in its charter)
 
         
Delaware
  4832   36-4159663
(State of Incorporation)
  (Primary Standard Industrial
Classification Code Number)
  (I.R.S. Employer
Identification No.)
 
3280 Peachtree Road, N.W.
Suite 2300
Atlanta, Georgia 30305
(404) 949-0700
 
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
 
Lewis W. Dickey, Jr.
Chairman, President and Chief Executive Officer
Cumulus Media Inc.
3280 Peachtree Road, N.W.
Suite 2300
Atlanta, Georgia 30305
(404) 949-0700
 
(Name, address, including zip code, and telephone number, including area code, of agent for service)
 
With copies to:
 
         
Mark L. Hanson, Esq.
Jones Day
1420 Peachtree Street, N.E.
Suite 800
Atlanta, Georgia 30309
(404) 521-3939
  Hilary Glassman, Esq.
Citadel Broadcasting Corporation
261 Madison Avenue
3rd Floor
New York, NY 10016
(212) 297-5860
  Howard Chatzinoff, Esq.
Raymond O. Gietz, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
(212) 310-8000
 
Approximate date of commencement of proposed sale of the securities to the public:  As soon as practicable after this registration statement is declared effective and after all conditions to the merger of an indirect wholly-owned subsidiary of Cumulus Media Inc. (“Cumulus Media”) with and into Citadel Broadcasting Corporation (“Citadel”) (the “merger”) in accordance with the agreement and plan of merger relating thereto and described in more detail elsewhere herein (the “merger agreement”) are satisfied or waived.
 
If the securities being registered on this form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, please check the following box.  o
 
If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o
 
If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
 
Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company þ
(Do not check if a smaller reporting company)
 
If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:
 
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)  o
 
Exchange Act Rule 14d-1(d) (Cross-Border Third Party Tender Offer)  o
 
CALCULATION OF REGISTRATION FEE
                         
            Proposed Maximum
    Proposed Maximum
    Amount of
Title of Class of
    Amount
    Offering
    Aggregate
    Registration
Securities to be Registered     to be Registered†     Price per Unit     Offering Price     Fee
Class A common stock, par value $.01 per share
    180,362,411(1)     N/A     $431,124,121(2)     $50,054(3)
Class B common stock, par value $.01 per share(4)
    180,362,411(5)     N/A     $431,124,121(2)          (6)
Warrants to purchase common stock(7)
    180,362,411(8)     N/A     $431,124,121(2)          (9)
                         
 
Pursuant to Rule 416, this registration statement also covers an indeterminate number of additional securities of Cumulus Media as may be issuable as a result of stock splits, stock dividends or similar transactions.
 
(1) Represents the maximum number of shares of Cumulus Media Class A common stock, par value $0.01 per share, issuable to holders of Citadel Class A common stock, par value $0.001 per share, Citadel Class B common stock, par value $0.001 per share (together, “Citadel common stock”) and warrants to purchase Citadel common stock, in the merger.
 
(2) Estimated solely for the purpose of calculating the registration fee pursuant to Rules 457(c), 457(f)(1) and 457(f)(3) promulgated under the Securities Act of 1933 (the “Securities Act”). The proposed maximum aggregate offering price is calculated based on the market value of 13,346,131 shares of Citadel Class A common stock (which includes an estimated 8,951,373 shares issuable upon the deemed exercise of all potentially outstanding options to purchase shares of Citadel Class A common stock and 652,561 restricted shares of Citadel Class A common stock) and 42,278,864 shares of Citadel Class B common stock (which includes warrants to purchase 23,219,455 shares of Citadel Class B common stock) to be exchanged in the merger, as established by the last sale reported on July 7, 2011 with respect to the Citadel Class A common stock, and July 7, 2011 with respect to the Citadel Class B common stock, in each case on the OTC Link on the OTCQB tier, which sale price was $33.00 per share of Citadel Class A common stock and $33.10 per share of Citadel Class B common stock, less $1,408,728,600, which is the maximum amount of cash payable by Cumulus Media in exchange for such shares of Citadel common stock pursuant to the merger agreement.
 
(3) Determined in accordance with Section 6(b) of the Securities Act at a rate equal to $116.10 per $1,000,000 of the proposed maximum aggregate offering price.
 
(4) The Cumulus Media Class B common stock being registered hereby and issuable in the merger as provided for herein will be created pursuant to an amended and restated certificate of incorporation to be filed with the Secretary of State of the State of Delaware in connection with the completion of the merger and described in more detail herein.
 
(5) Represents the maximum number of shares of Cumulus Media Class B common stock, par value $0.01 per share, issuable to holders of Citadel common stock and warrants to purchase Citadel common stock in the merger.
 
(6) The maximum number of all classes of securities issuable in the merger is 180,362,411. If and to the extent any shares of Cumulus Media Class B common stock are issued in the merger, there would be a one-for-one reduction in the number of shares of Cumulus Media Class A common stock issued in the merger and, consequently, the registration fee payable thereunder should be reduced accordingly. Because the registration fee set out above contemplates the issuance of the maximum number of securities issuable in the merger all in the form of Class A common stock, no additional registration fee is payable in connection with the registration of the Cumulus Media Class B common stock.
 
(7) If Cumulus Media reasonably determines that the issuance of its Class A common stock or Class B common stock to a Citadel stockholder or warrant holder in the merger would result in a violation of the Communications Act or FCC rules and policies, it may issue to such stockholder or warrant holder warrants to purchase shares of its Class A common stock or Class B common stock.
 
(8) Represents the maximum number of warrants to purchase shares of Cumulus Media common stock issuable to holders of Citadel common stock and warrants to purchase common stock in the merger. The number of shares of Class A common stock set out above includes any number of shares which may underlie any warrants issued in the merger.
 
(9) If and to the extent any warrants to purchase shares of Cumulus Media common stock are issued in the merger, there would be a one-for-one reduction in the number of shares of Cumulus Media Class A common stock and/or Class B common stock issued in the merger and, consequently, the registration fee payable thereunder should be reduced accordingly. Because the registration fee set out above contemplates the issuance of the maximum number of securities issuable in the merger, no additional registration fee is payable in connection with the registration of the warrants.
 
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until this registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
 


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The information in this document is not complete and may be changed. Cumulus Media Inc. may not issue these securities until the registration statement filed with the Securities and Exchange Commission is effective. This document is not an offer to sell these securities and Cumulus Media Inc. is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
 
 
SUBJECT TO COMPLETION, DATED JULY 12, 2011
 
INFORMATION STATEMENT/PROXY STATEMENT/PROSPECTUS
 
PROPOSED MERGER — YOUR VOTE IS IMPORTANT
 
          , 2011
 
This document is a prospectus related to a proposed issuance of shares of Class A common stock (or, in certain instances, other securities) of Cumulus Media Inc., or “Cumulus Media,” pursuant to an Agreement and Plan of Merger, referred to as the “merger agreement,” entered into with, among others, Citadel Broadcasting Corporation, or “Citadel,” and pursuant to which, if the requisite stockholder and other approvals are obtained, Citadel will merge with an indirect wholly-owned subsidiary of Cumulus Media, which transaction is referred to as the “merger.” This document is also a proxy statement for Citadel to use in soliciting proxies for its annual meeting of stockholders, at which meeting Citadel’s stockholders will vote on, among other things, adoption of the merger agreement, as well as an information statement for those Cumulus Media stockholders who did not enter into the stockholder approvals of Cumulus Media’s proposed issuances of equity securities in the merger and related transactions, as well as certain related transactions described herein, that have already been obtained.
 
The boards of directors of Cumulus Media and Citadel have each agreed to the merger. This document is being sent to Citadel stockholders to ask them to vote in favor of the adoption of the merger agreement. The approval of Citadel’s stockholders must be obtained before the merger can be completed. Cumulus Media has already obtained the necessary approvals for the issuance of various of its equity securities in the merger and certain related transactions described herein by stockholders holding the majority of its outstanding voting power, pursuant to the rules of the Nasdaq Stock Market and the General Corporation Law of the State of Delaware. As a result, no further vote of Cumulus Media’s stockholders is being sought in connection herewith, although this document is being sent to all of Cumulus Media’s stockholders in order to inform them of such approvals and of the proposed merger.
 
If the merger agreement is adopted by Citadel stockholders and the merger is completed, each share of Citadel Class A common stock and Citadel Class B common stock will be converted (and each warrant to purchase Citadel common stock will be adjusted) into the right to receive (i) $37.00 in cash, (ii) 8.525 shares of Cumulus Media Class A common stock, or (iii) a combination of cash and Cumulus Media Class A common stock, in each case subject to proration, with the actual number of shares to be issued, and amount of cash to be paid, dependent upon elections to be made by Citadel stockholders prior to the completion of the merger. In certain instances, Cumulus Media may issue to Citadel stockholders and warrant holders in the merger shares of a to-be-created class of its non-voting common stock, to be called Class B common stock, in lieu of an equal number of shares of its Class A common stock, or Cumulus Media may issue warrants exercisable for such number of its Class A common stock or Class B common stock. The implied value of the stock portion of the merger consideration will fluctuate as the market price of Cumulus Media Class A common stock fluctuates. You should obtain current stock price quotations for Cumulus Media Class A common stock and Citadel Class A common stock and Class B common stock before deciding how to vote with respect to the adoption of the merger agreement and what type of merger consideration to elect. Cumulus Media Class A common stock is quoted on the Nasdaq Global Select Market under the symbol “CMLS” and Citadel Class A common stock and Class B common stock are quoted by the OTC Link on the OTCQB tier under the symbols “CDELA” and “CDELB,” respectively.
 
The annual meeting of Citadel stockholders will be held on          , 2011 at     , local time, at     . At the annual meeting, Citadel stockholders will be asked to vote on the adoption of the merger agreement, the approval of the adjournment of the annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the annual meeting, the election of two class I directors to Citadel’s board of directors, the approval, on a non-binding advisory basis, of compensation that may be received by Citadel’s named executive officers in connection with the merger, and the ratification of the appointment of Deloitte & Touche LLP to serve as Citadel’s independent registered public accountants for the year ending December 31, 2011, as well as to consider and act upon such other business as may properly come before the Citadel annual meeting or any adjournment or postponement thereof. Citadel’s board of directors unanimously recommends that you vote “FOR” the adoption of the merger agreement; “FOR” the approval of the adjournment of the Citadel annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the annual meeting; “FOR” the election of each of the two class I director nominees to Citadel’s board of directors; “FOR” the approval on a non-binding, advisory basis of compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger; and “FOR” the ratification of the appointment of Deloitte & Touche LLP as Citadel’s independent registered public accountants for the year ending December 31, 2011.
 
This information statement/proxy statement/prospectus is an important document containing answers to frequently asked questions and a summary description of the merger and the merger agreement (beginning on page      ), followed by more detailed information about Cumulus Media, Citadel, the transactions related to the merger which have been approved by Cumulus Media’s stockholders, and the other matters to be voted upon by Citadel stockholders as part of the Citadel annual meeting. We urge you to read this document carefully and in its entirety. In particular, you should consider the matters discussed under “Risk Factors” beginning on page       of this document.
 
We look forward to the successful merger of Cumulus Media and Citadel.
 
     
Lewis W. Dickey, Jr.
Chairman, President and Chief Executive Officer
Cumulus Media Inc. 
  Farid Suleman
President and Chief Executive Officer
Citadel Broadcasting Corporation
 
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this document or determined that this document is accurate or complete. Any representation to the contrary is a criminal offense.
 
This document is dated          , 2011 and is first being mailed to stockholders of Cumulus Media and Citadel on or about          , 2011.


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(CITADEL LOGO)
 
CITADEL BROADCASTING CORPORATION
7690 W. Cheyenne Avenue, Suite 220
Las Vegas, Nevada 89129
(702) 804-5200
 
YOUR VOTE IS VERY IMPORTANT
 
To our Stockholders:
 
It is my pleasure to invite you to attend the 2011 Citadel Broadcasting Corporation (“Citadel”) annual meeting of stockholders to be held on     ,     , 2011, at     , at     .
 
At the meeting, stockholders will vote on the matters set forth in the notice of the meeting that follows on the next page. All stockholders of record at the close of business on          , 2011 are entitled to notice of, and to vote at, the annual meeting on certain matters as set forth in the notice of meeting that follows on the next page. Your vote is very important. We urge you to please vote your shares now whether or not you plan to attend the annual meeting. Accordingly, we encourage you to read the information statement/proxy statement/prospectus and cast your vote promptly via the Internet, by telephone or by mailing in the appropriate completed proxy card.
 
If you decide to attend the annual meeting, you will be able to vote in person, even if you have previously submitted your proxy.
 
We look forward to seeing you at the meeting and appreciate your continued support.
 
Sincerely,
 
Farid Suleman
President and Chief Executive Officer
Citadel Broadcasting Corporation
 
Las Vegas, Nevada
          , 2011


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(CITADEL LOGO)
 
CITADEL BROADCASTING CORPORATION
7690 W. Cheyenne Avenue, Suite 220
Las Vegas, Nevada 89129
(702) 804-5200
 
NOTICE OF 2011 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON          , 2011
 
NOTICE IS HEREBY GIVEN that the 2011 annual meeting of stockholders of Citadel Broadcasting Corporation, which we refer to as Citadel, will be held on     ,     , 2011, at     , at     . Holders of Class A common stock at the close of business on          , 2011 (“the record date”) will be asked to:
 
1. consider and vote upon the adoption of the Agreement and Plan of Merger, dated as of March 9, 2011, as it may be amended from time to time, among Citadel, Cumulus Media Inc., Cumulus Media Holdings Inc. (f/k/a Cadet Holding Corporation) and Cadet Merger Corporation (the “merger agreement”);
 
2. consider and vote upon the approval of the adjournment of the annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the annual meeting;
 
3. consider and vote upon the election of each of the two class I director nominees to Citadel’s board of directors;
 
4. consider and vote on a non-binding, advisory basis to approve compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger;
 
5. consider and vote upon the ratification of the appointment of Deloitte & Touche LLP to serve as Citadel’s independent registered public accountants for the year ending December 31, 2011; and
 
6. consider and act upon such other business as may properly come before the annual meeting or any adjournment or postponement thereof.
 
In addition, at the annual meeting, holders of Class B common stock as of the record date will be asked to consider and vote, together with holders of Class A common stock as of the record date as a single class, upon Proposals 1 and 5 above.
 
Please refer to the attached information statement/proxy statement/prospectus and the merger agreement for further information with respect to the business to be transacted at the 2011 annual meeting of Citadel’s stockholders. Citadel expects to transact no other business at the meeting, except for business properly brought before the meeting and any adjournment or postponement thereof. Holders of record as of the record date of Citadel Class A common stock will be entitled to notice of and to vote at the annual meeting with regard to Proposals 1-5 described above. Holders of Citadel Class B common stock as of the record date will be entitled to notice of and to vote at the annual meeting, together with holders of Citadel Class A common stock as of the record date as a single class, with regard to Proposals 1 and 5 described above.
 
Citadel’s board of directors unanimously recommends that you vote “FOR” the adoption of the merger agreement; “FOR” the approval of the adjournment of the annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of


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the annual meeting; “FOR” the election of each of the two class I director nominees to Citadel’s board of directors; “FOR” the approval on a non-binding, advisory basis of compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger; and “FOR” the ratification of the appointment of Deloitte & Touche LLP as Citadel’s independent registered public accountants for the year ending December 31, 2011.
 
YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES THAT YOU OWN. Whether or not you plan on attending the annual meeting, we urge you to read the information statement/proxy statement/prospectus carefully and to please vote your shares as promptly as possible. You may vote your shares by proxy electronically via the Internet, by telephone, by sending in the appropriate paper proxy card or in person at the annual meeting.
 
All stockholders are cordially invited to attend the 2011 annual meeting. If you have any questions about this information statement/proxy statement/prospectus, you should contact:                         .
 
By Order of the Board of Directors
 
Las Vegas, Nevada
          , 2011


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(CUMULUS LOGO)
 
Cumulus Media Inc.
3280 Peachtree Road, N.W.
Suite 2300
Atlanta, Georgia 30305
 
NOTICE OF APPROVALS GIVEN AND ACTIONS TO BE TAKEN
 
To the Stockholders of Cumulus Media Inc.:
 
WE ARE NOT ASKING YOU FOR YOUR PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY. THE ACTIONS DESCRIBED BELOW HAVE ALREADY BEEN APPROVED BY WRITTEN CONSENT OF HOLDERS OF A MAJORITY OF THE OUTSTANDING VOTING POWER OF CUMULUS MEDIA INC. PURSUANT TO THE RULES OF THE NASDAQ STOCK MARKET AND THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE. A VOTE OF THE REMAINING STOCKHOLDERS IS NOT NECESSARY.
 
This information statement/proxy statement/prospectus is being furnished in connection with the Agreement and Plan of Merger, dated as of March 9, 2011, by and among Cumulus Media Inc., which we refer to as Cumulus Media, Cumulus Media Holdings Inc. (f/k/a Cadet Holding Corporation), which we refer to as Holdco, Cadet Merger Corporation, which we refer to as Merger Sub, and Citadel Broadcasting Corporation, which we refer to as Citadel, as such agreement may be amended from time to time, and certain related transactions. If Citadel stockholders adopt the merger agreement and the merger is subsequently completed, Merger Sub will merge with and into Citadel and, subject to the limitations described below, each share of Citadel Class A common stock and Citadel Class B common stock will be converted (and each warrant to purchase Citadel common stock will be adjusted) into the right to receive (i) $37.00 in cash, (ii) 8.525 shares of Cumulus Media Class A common stock, or (iii) a combination of cash and Cumulus Media Class A common stock, in each case subject to proration. In certain instances, Cumulus Media may issue to Citadel stockholders and warrant holders in the merger shares of a to-be-created class of its non-voting stock, to be called Class B common stock, in lieu of an equal number of shares of its Class A common stock, or Cumulus Media may issue warrants exercisable for such number of shares of its Class A common stock or Class B common stock.
 
In connection with the merger agreement, we entered into, and subsequently amended and restated, an investment agreement, which we refer to as the Investment Agreement, with certain investors, whom we refer to as the Investors, pursuant to which the Investors have committed to purchase with cash up to an aggregate of $500.0 million in shares of our common stock, preferred stock or warrants to purchase common stock, at a purchase price per share (or warrant) of $4.34. Specifically, Crestview Radio Investors, LLC, an affiliate of Crestview Partners II, L.P., has agreed to purchase up to $250.0 million in shares of our Class A common stock and MIHI LLC, an affiliate of Macquarie Capital (USA) Inc., and UBS Securities LLC have each agreed to purchase up to $125.0 million in warrants, which will be immediately exercisable by U.S. persons (as defined herein), subject to the Communications Act of 1934, as amended, and FCC rules and policies, at an exercise price of $0.01 per share, for shares of our Class B common stock. In addition, Macquarie may, at its option, elect to receive the full amount of its investment in shares of a to-be-created class of perpetual, redeemable, non-convertible preferred stock of Cumulus Media.
 
As a part of the transactions contemplated by the Investment Agreement, our board of directors and the holders of a majority of our outstanding voting power approved a new equity incentive plan, pursuant to which we will be able to issue equity awards to our officers, directors, employees and other individuals. Upon the effectiveness of this new equity incentive plan, the remaining authorization for equity awards under our currently existing equity incentive plans will be canceled.


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In furtherance of the merger, equity investment, and the issuance of shares of our stock thereunder, our board of directors also approved and recommended that our stockholders adopt an amended and restated certificate of incorporation of Cumulus Media, which, among other things, creates the various classes of stock of Cumulus Media necessary and desirable to complete each of the foregoing transactions.
 
Pursuant to the rules of the Nasdaq Stock Market and the General Corporation Law of the State of Delaware, as applicable, the proposed issuance of equity securities in each of the merger and pursuant to the Investment Agreement, the adoption of a new equity incentive plan and the adoption of an amended and restated certificate of incorporation each requires the approval of holders of a majority of the outstanding voting power of Cumulus Media common stock. On March 9, 2011, BA Capital Company, L.P., Banc of America Capital Investors SBIC, L.P., DBBC, L.L.C., Lewis W. Dickey, Jr., John W. Dickey, David W. Dickey, Michael W. Dickey and Lewis W. Dickey, Sr., which together, on that date, owned a majority of the outstanding voting power of Cumulus Media (collectively, the “Consenting Stockholders”), executed written consents approving the issuance of the shares pursuant to each of the merger agreement and the Investment Agreement. Furthermore, on July 8, 2011, the Consenting Stockholders approved the adoption of our amended and restated certificate of incorporation and the adoption of our new equity incentive plan.
 
As a result of the foregoing, no further action on the part of Cumulus Media stockholders is required in connection with any of these transactions. However, pursuant to the requirements of Section 14(c) of the Securities Exchange Act of 1934 and Section 228(d) of the General Corporation Law of the State of Delaware, Cumulus Media is required to send to its stockholders a written information statement, which is satisfied by delivery of this document, at least 20 calendar days prior to the date upon which any of these transactions can become effective or occur, as applicable. This document is being mailed to Cumulus Media stockholders on or about          , 2011.
 
By Order of the Board of Directors,
 
Richard S. Denning
Corporate Secretary
 
          , 2011


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REFERENCES TO ADDITIONAL INFORMATION
 
This document incorporates by reference important business and financial information about each of Cumulus Media and Citadel from documents that each company has filed with the Securities and Exchange Commission (the “SEC”) but that are not being included in or delivered with this document. This information is available to you without charge upon your written or oral request. You may read and copy documents incorporated by reference in this information statement/proxy statement/prospectus, other than certain exhibits to those documents, and other information about each of Cumulus Media and Citadel that is filed with the SEC under the Securities and Exchange Act of 1934 (the “Exchange Act”) at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, DC 20549. You can also obtain such documents free of charge through the SEC’s website (www.sec.gov) or by requesting them in writing or by telephone from the appropriate company at the following addresses and telephone numbers:
 
             
For information about Cumulus Media Inc.:   For information about Citadel Broadcasting Corporation:
 
By Mail:
  Cumulus Media Inc.
3280 Peachtree Road, NW Suite 2300
Atlanta, Georgia 30305
Attention: Joseph P. Hannan, SVP, Treasurer and CFO
  By Mail:   Citadel Broadcasting Corporation
7690 W. Cheyenne Avenue, Suite 220
Las Vegas, Nevada 89129
Attention: Randy L. Taylor, CFO
By Telephone:
  (404) 260-6600   By Telephone:   (702) 804-5200
By Internet:
  www.cumulus.com   By Internet:   www.citadelbroadcasting.com
 
IF YOU WOULD LIKE TO REQUEST ANY DOCUMENTS, PLEASE DO SO BY      , 2011 IN ORDER TO RECEIVE THEM BEFORE THE CITADEL ANNUAL MEETING.
 
For additional information on documents incorporated by reference in this document, please see “Where You Can Find More Information” on page      . Please note that information contained on the websites of Cumulus Media or Citadel is not incorporated by reference in, nor considered to be part of, this information statement/proxy statement/prospectus.
 
The firm assisting Citadel with the solicitation of proxies:
 
Georgeson Inc.
 
Stockholders call toll-free: 888-624-7035
Banks and brokers call: 212-440-9800
 
ABOUT THIS DOCUMENT
 
Cumulus Media has supplied all information contained in or incorporated by reference into this information statement/proxy statement/prospectus relating to Cumulus Media. Citadel has supplied all information contained in or incorporated by reference into this information statement/proxy statement/prospectus relating to Citadel. Cumulus Media and Citadel have both contributed to information relating to the merger.
 
You should rely only on the information contained in or incorporated by reference into this document. No one has been authorized to provide you with information that is different from that contained in or incorporated by reference into this document. This document is dated          , 2011. You should not assume that the information contained in this document is accurate as of any date other than the date hereof. You should not assume that the information contained in any document incorporated by reference herein is accurate as of any date other than the date of such other document. Any statement contained in a document incorporated or deemed to be incorporated by reference into this document will be deemed to be modified or superseded to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference into this document modifies or supersedes that statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this document. Neither the mailing of this document to the respective stockholders of Cumulus Media and Citadel, nor the taking of any actions contemplated hereby by Cumulus Media or Citadel at any time will create any implication to the contrary.
 
This document does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction in which or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction.


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 EX-99.1
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 EX-99.7


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QUESTIONS AND ANSWERS
 
The questions and answers below highlight only selected information from this information statement/proxy statement/prospectus. They do not contain all of the information that may be important to you. Cumulus Media’s board of directors is not soliciting votes of its stockholders on any of the matters to be undertaken by Cumulus Media and described herein. Citadel’s board of directors is soliciting proxies from its stockholders to vote at the 2011 annual meeting of Citadel stockholders, to be held on          , 2011 at       , local time, at       , and any adjournment or postponement of that meeting. You should read carefully the entire information statement/proxy statement/prospectus and the additional documents incorporated by reference into this information statement/proxy statement/prospectus to fully understand the matters to be acted upon and the voting procedures for Citadel’s annual meeting.
 
Frequently Used Terms
 
This document generally avoids the use of technical defined terms, but a few frequently used terms may be helpful for you to have in mind at the outset. This document refers to:
 
  •  Cumulus Media Class A common stock and Cumulus Media Class B common stock, together as “Cumulus Media common stock”;
 
  •  Cumulus Media Inc., a Delaware corporation, as “Cumulus Media”;
 
  •  Cumulus Media Holdings Inc. (f/k/a Cadet Holding Corporation), a Delaware corporation and wholly-owned subsidiary of Cumulus Media, as “Holdco”;
 
  •  Cadet Merger Corporation, a Delaware corporation and a wholly-owned subsidiary of Holdco, as “Merger Sub”;
 
  •  Citadel Broadcasting Corporation, a Delaware corporation, and its consolidated subsidiaries, together as “Citadel”;
 
  •  Citadel Class A common stock and Citadel Class B common stock, together as “Citadel common stock”;
 
  •  Cumulus Media Partners, LLC and its consolidated subsidiaries, collectively as “CMP”;
 
  •  the merger of Merger Sub into Citadel and the conversion of shares of, and adjustment of warrants to purchase, Citadel common stock into the right to receive cash and/or shares of Cumulus Media Class A common stock (or in certain instances, shares of Cumulus Media Class B common stock or warrants in lieu thereof), as the “merger”;
 
  •  the Agreement and Plan of Merger, dated March 9, 2011 (as it may be amended from time to time), among Cumulus Media, Holdco, Merger Sub, and Citadel, as the “merger agreement”;
 
  •  the Investment Agreement, dated as of March 9, 2011, and as amended and restated as of April 22, 2011 (as it may be further amended from time to time) pursuant to which (i) Crestview Radio Investors, LLC (“Crestview”), an affiliate of Crestview Partners II, L.P., (ii) an affiliate of Macquarie Capital (USA) Inc. (“Macquarie”) and (iii) UBS Securities LLC (“UBS Securities” and together with Crestview and Macquarie, the “Investors”), have agreed to invest up to an aggregate of $500.0 million in Cumulus Media’s equity securities described below or warrants to purchase the same, the proceeds of which will be used to pay a part of the cash portion of the purchase price for, and which investment is conditioned on, among other things, the closing of the merger, as the “Investment Agreement”;
 
  •  the commitment the Investors have pursuant to the Investment Agreement to purchase for cash up to an aggregate of $500.0 million in shares of Cumulus Media common stock, preferred stock or warrants to purchase common stock, at a purchase price per share (or warrant) of $4.34, as the “Equity Investment”;
 
  •  the Federal Communications Commission, as the “FCC”;


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  •  applications that have been or will be filed with the FCC to obtain FCC Approval (defined below) for the transfers of control or assignment of the FCC Authorizations held by Cumulus Media and Citadel required for the consummation of the merger agreement, as the “FCC Applications”;
 
  •  any action by the FCC (including action duly taken by the FCC’s staff pursuant to delegated authority) granting its consent to the transfer of control or assignment to Merger Sub, Holdco or Cumulus Media (or any affiliate of Merger Sub, Holdco or Cumulus Media) of the FCC Authorizations (as defined below) as proposed in the FCC Applications, as the “FCC Approval”;
 
  •  all licenses, permits, approvals, construction permits, and other authorizations issued or granted by the FCC to Citadel or any Citadel subsidiary or Cumulus Media or any Cumulus Media subsidiary, as applicable, including any and all auxiliary and/or supportive transmitting and/or receiving facilities, boosters, and repeaters, together with any and all renewals, extensions, or modifications thereof and additions thereto between the date of the merger agreement and the effective time of the merger, as the “FCC Authorizations”;
 
  •  the Communications Act of 1934, as amended, as the “Communications Act”;
 
  •  the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, as the “HSR Act” or the “Hart-Scott-Rodino Act”; and
 
  •  the General Corporation Law of the State of Delaware, as the “DGCL.”
 
Questions and Answers for Citadel Stockholders
 
Q: Why have I received this information statement/proxy statement/prospectus?
 
A: This document is being delivered to you as both a proxy statement of Citadel and a prospectus of Cumulus Media. It is a proxy statement because Citadel’s board of directors is soliciting proxies from its stockholders to vote on the adoption of the merger agreement at Citadel’s 2011 annual meeting of stockholders as well as the other matters set forth in the notice of the meeting and described in this information statement/proxy statement/prospectus, and your proxy will be used at the meeting or at any adjournment or postponement of the meeting. It is a prospectus because Cumulus Media will issue Cumulus Media common stock and/or warrants to the Citadel common stockholders and warrant holders in the merger. On or about          , 2011 Citadel intends to mail to its stockholders of record as of the close of business on          , 2011 printed versions of these materials.
 
Your vote is important. Citadel encourages you to vote as soon as possible.
 
Q: What matters are to be voted on at the Citadel annual meeting?
 
A: At the Citadel annual meeting, holders of Citadel Class A common stock as of the close of business on          , 2011 (the “record date”) will be asked to:
 
1. consider and vote upon the adoption of the merger agreement;
 
2. consider and vote upon the approval of the adjournment of the annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the annual meeting;
 
3. consider and vote upon the election of each of the two class I director nominees to Citadel’s board of directors;
 
4. consider and vote on a non-binding, advisory basis to approve compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger;
 
5. consider and vote upon the ratification of the appointment of Deloitte & Touche LLP to serve as Citadel’s independent registered public accountants for the year ending December 31, 2011; and
 
6. consider and act upon such other business as may properly come before the annual meeting or any adjournment or postponement thereof.


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In addition, at the Citadel annual meeting, holders of Citadel Class B common stock as of the record date will be asked to consider and vote, together with holders of Citadel Class A common stock as of the record date as a single class, upon Proposals 1 and 5 described above.
 
Q: What is the recommendation of Citadel’s board of directors with respect to each Proposal?
 
A: Citadel’s board of directors unanimously recommends a vote:
 
1. FOR the adoption of the merger agreement;
 
2. FOR the approval of the adjournment of the annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the annual meeting;
 
3. FOR the election of each of the class I director nominees to Citadel’s board of directors;
 
4. FOR the approval on a non-binding, advisory basis of compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger; and
 
5. FOR the ratification of the appointment of Deloitte & Touche LLP as Citadel’s independent registered public accountants for the year ending December 31, 2011.
 
Q: Will any other matters be presented for a vote at the Citadel annual meeting?
 
A: At this time, Citadel is not aware of any other matters that will be presented for a vote at the Citadel annual meeting. However, if any other matters properly come before the annual meeting, the proxies will have the discretion to vote upon such matters in accordance with their best judgment.
 
Q: When and where is the Citadel annual meeting?
 
A: The Citadel annual meeting will be held at          , local time, on          , 2011, at          .
 
Q: Who can attend the Citadel annual meeting?
 
A: You are entitled to attend the Citadel annual meeting only if you are a Citadel stockholder of record or a beneficial owner as of the record date, or you hold a valid proxy for the annual meeting.
 
If you are a Citadel stockholder of record and wish to attend the annual meeting, please so indicate on the appropriate proxy card or as prompted by the telephone or Internet voting system. Your name will be verified against the list of Citadel stockholders of record prior to your being admitted to the annual meeting.
 
If a bank, broker or other nominee is the record owner of your Citadel shares, you will need to have proof that you are the beneficial owner to be admitted to the annual meeting. A recent statement or letter from your bank or broker confirming your ownership as of the record date, or presentation of a valid proxy from a bank, broker or other nominee that is the record owner of your Citadel shares, would be acceptable proof of your beneficial ownership.
 
You should be prepared to present photo identification for admittance. If you do not provide photo identification or comply with the other procedures outlined above upon request, you may not be admitted to the annual meeting.
 
Q: Who can vote at the Citadel annual meeting?
 
A: Holders of record at the close of business as of the record date of Citadel Class A common stock will be entitled to notice of and to vote at the Citadel annual meeting with regard to Proposals 1-5 described above. Holders of Citadel Class B common stock as of the record date will be entitled to notice of and to vote at the Citadel annual meeting, together with holders of Citadel Class A common stock as of the record date as a single class, with regard to Proposals 1 and 5 described above. With respect to Proposal 3, each holder of Citadel Class A common stock as of the record date is entitled to one vote per share with respect to each individual director nominee, and need not cast a vote considering both individual director nominees together as a group. Except as described in the previous sentence, each of the           shares of Citadel Class A common stock issued and outstanding on the record date is entitled to one vote at the Citadel annual meeting with regard to each of Proposals 1-5 described above, and each of the           shares of Citadel Class B


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common stock issued and outstanding on the record date is entitled to one vote at the Citadel annual meeting with regard to each of Proposals 1 and 5 described above.
 
Q: What is a quorum?
 
A: In order for business to be conducted at the Citadel annual meeting, a quorum must be present. A majority of the aggregate outstanding shares of Citadel Class A common stock and Class B common stock must be represented, either in person or by proxy, to constitute a quorum at the Citadel annual meeting. Citadel shares represented by valid proxies will be treated as present at the Citadel annual meeting for purposes of determining a quorum, without regard to whether the proxy is noted as casting a vote or abstaining. Citadel shares represented by broker non-votes will be treated as present for purposes of determining a quorum. Citadel shares voted by a broker on any issue other than a procedural motion will be considered present for all quorum purposes, even if the shares are not voted on every matter.
 
Q: How do I vote my shares?
 
A: You may vote your Citadel shares by proxy electronically via the Internet, by telephone, by sending in the appropriate paper proxy card or in person at the Citadel annual meeting. You can specify how you want your Citadel shares voted on each Proposal by marking the appropriate boxes on the appropriate proxy card or indicating your vote on each Proposal via the telephone or Internet. Please review the voting instructions on the proxy card and read the entire text concerning the Proposals in this information statement/proxy statement/prospectus prior to voting.
 
Whether you vote your proxy electronically over the Internet, by telephone or by mail, Citadel will treat your proxy the same way. The individuals appointed as proxy holders will be Farid Suleman, Randy Taylor and Hilary Glassman. The Citadel shares represented by valid proxies that Citadel receives in time for the Citadel annual meeting will be voted as specified in such proxies. Valid proxies include all properly executed, written paper proxy cards received pursuant to this solicitation that are not later revoked. Executed but unvoted proxies will be voted in accordance with the recommendations of Citadel’s board of directors.
 
Q: Why are there two different proxy cards attached to this information statement/proxy statement/prospectus?
 
A: There are two different proxy cards attached to this information statement/proxy statement/prospectus because holders of Citadel Class A common stock and holders of Citadel Class B common stock who wish to complete a proxy card must complete a card which relates to the class of stock that they hold. Thus, one of the attached proxy cards relates to Citadel Class A common stock, and the other to Citadel Class B common stock. It is important that each stockholder use only the correct proxy card(s) to record his or her votes. Use of the wrong proxy card could invalidate your vote, so please be careful to use the right card when you cast your vote. If you have any questions about the voting procedures, please read the information statement/proxy statement/prospectus carefully, as it explains these matters more fully. You may also call Georgeson Inc. (the “Proxy Solicitor”) directly with any particular questions you may have. The telephone number of the Proxy Solicitor is 888-624-7035.
 
Q: How do I vote if I am a beneficial stockholder?
 
A: If you are a beneficial stockholder, meaning you hold your Citadel shares in street name, you have the right to direct your bank or nominee on how to vote the shares. You should complete a voting instruction card provided to you by your bank, broker or nominee or provide your voting instructions by Internet or telephone, if made available by your bank, broker or other nominee. If you wish to vote in person at the meeting, you must first obtain from the holder of record a proxy issued in your name.
 
Q: Can I change my vote after I have delivered my proxy?
 
A: Yes. You can change your vote at any time before your proxy is voted at the Citadel annual meeting. If you are a holder of record you can do so by:
 
  •  filing a written notice of revocation with the Secretary, Citadel Broadcasting Corporation, 7690 W. Cheyenne Avenue, Suite 220, Las Vegas, Nevada 89129;


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  •  submitting a new proxy before the Citadel annual meeting;
 
  •  by voting by telephone or via Internet at a later date (in which case only the last vote is counted); or
 
  •  attending the Citadel annual meeting and voting in person. Attendance at the Citadel annual meeting will not in and of itself constitute a revocation of a proxy.
 
For shares held beneficially by you, you may change your vote only by submitting new voting instructions to your broker or nominee. If the Citadel annual meeting is postponed or adjourned, it will not affect the ability of stockholders of record as of the record date to exercise their voting rights or to revoke any previously granted proxy using the methods described above.
 
Q: What is “householding” and how does it affect me?
 
A: Some banks and brokers may be participating in the practice of “householding” proxy statements and annual reports. This means that only one copy of this information statement/proxy statement/prospectus may have been sent to multiple stockholders in your household. Citadel will promptly deliver a separate copy of either or both documents to you if you write or call Citadel at the following address or phone number: Georgeson Inc., Attention:          , phone: 888-624-7035.
 
Q: What if I receive more than one set of proxy cards or more than one e-mail instructing me to vote?
 
A: If you receive more than one set of proxy cards or more than one e-mail instructing you to vote, your shares are registered in more than one name or are registered in different accounts. Please complete, date, sign and return each appropriate proxy card, and respond to each e-mail, to ensure that all your shares are voted.
 
Q: Who is the inspector of election?
 
A: Citadel’s board of directors has appointed a representative of The Bank of New York Mellon to act as Inspector of Election at the Citadel annual meeting.
 
Q: What are the costs for soliciting proxies for the Citadel annual meeting?
 
A: Cumulus Media and Citadel will each pay one-half of the costs and expenses incurred in connection with the filing, printing and mailing of this document. Citadel will reimburse brokers, banks, institutions and others holding common stock of Citadel as nominees for their expenses in sending proxy solicitation material to the beneficial owners of such common stock of Citadel and obtaining their proxies. Management has retained Georgeson Inc. to assist in soliciting proxies for a fee of up to $7,500, plus reasonable out-of-pocket expenses. Solicitation of proxies by mail may be supplemented by telephone and other electronic means, advertisements and personal solicitation by the directors, officers or employees of Citadel. No additional compensation will be paid to Citadel’s directors, officers or employees for solicitation.
 
Q: As a Citadel stockholder, why am I electing Citadel directors, ratifying the appointment of an independent registered public accounting firm for Citadel and considering other proposals when I am being asked to adopt the merger agreement?
 
A: Delaware law requires Citadel to hold a meeting of its stockholders each year. Citadel is observing this requirement by holding the meeting to elect directors to Citadel’s board of directors, ratify the appointment of Deloitte & Touche LLP as Citadel’s independent registered public accounting firm for 2011 and consider certain other proposals. The Citadel directors elected at the Citadel annual meeting will serve as directors of Citadel following the meeting through the earliest of the effective time of the merger, Citadel’s 2014 annual meeting of stockholders, or his or her death, removal, retirement or resignation. At the effective time of the merger, the individuals serving as Citadel directors immediately prior to the effective time of the merger will no longer be Citadel directors. Deloitte & Touche LLP will not continue to conduct an independent audit of Citadel following the merger. The election of the nominees for director, the ratification of the selection of Deloitte & Touche LLP as Citadel’s independent registered public accounting firm and the other proposals are not conditions to completion of the merger.


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Q: What is the merger transaction upon which I am being asked to vote?
 
A: Holders of Citadel Class A common stock and Citadel Class B common stock as of the record date are being asked to vote, as a single class, to adopt the merger agreement, pursuant to which Citadel will merge with Merger Sub, with Citadel surviving as an indirect wholly-owned subsidiary of Cumulus Media.
 
Q: Why is Citadel proposing the merger?
 
A: In the course of reaching its decision to approve the merger agreement and the transactions contemplated thereby, Citadel’s board of directors considered a number of factors in its deliberations. For detail on these, please see “The Merger — Recommendation of Citadel’s Board of Directors and Citadel’s Reasons for the Merger” on page      .
 
Q: What stockholder approvals are needed for Citadel?
 
A: Proposal 1 requires the affirmative vote of a majority of the outstanding shares of Citadel Class A common stock and Citadel Class B common stock as of the record date, voting together as a single class, to be approved. Proposal 5 requires the affirmative vote of a majority of the votes cast at the Citadel annual meeting by holders of Citadel Class A common stock and Citadel Class B common stock as of the record date, voting together as a single class, to be approved.
 
Proposals 2 and 4 require the affirmative vote of a majority of the votes cast at the annual meeting by holders of Citadel Class A common stock as of the record date to be approved. Proposal 3 requires the affirmative vote of a plurality of the votes at the annual meeting by holders of Citadel Class A common stock as of the record date for each director nominee to be approved.
 
As of          , 2011, the record date for determining stockholders of Citadel entitled to vote at the Citadel annual meeting, there were           outstanding shares of Citadel Class A common stock and           outstanding shares of Citadel Class B common stock. On that date, there were           total shares of Citadel common stock outstanding and entitled to vote at the Citadel annual meeting, held by approximately           holders of record.
 
Q: What will I receive for my Citadel shares in the proposed merger?
 
A: Citadel stockholders may make one of the following elections regarding the type of merger consideration they wish to receive in exchange for their shares of Citadel common stock in the merger:
 
  •  a cash election to receive $37.00 in cash for each share of Citadel common stock, subject to proration; or
 
  •  a share election to receive 8.525 shares of Cumulus Media Class A common stock, subject to proration, and also subject to the right of Cumulus Media, in the exercise of its reasonable determination, to issue shares of Cumulus Media Class B common stock or warrants to acquire Cumulus Media Class A common stock or Cumulus Media Class B common stock if it reasonably determines that the issuance of Cumulus Media Class A common stock or Cumulus Media Class B common stock would cause Cumulus Media to be in violation of the Communications Act or FCC rules and policies.
 
The form of merger consideration that Citadel stockholders actually receive may be adjusted as a result of the proration procedures pursuant to the merger agreement as described in this information statement/proxy statement/prospectus under “The Merger — Citadel Stockholders and Warrant Holders Making Cash and Stock Elections — Proration Procedures” on page   . These proration procedures are designed to ensure that Cumulus Media does not (i) pay cash in excess of (a) $1,408,728,600, plus (b) the product of (1) the number of shares of Citadel Class A common stock issued upon the exercise of Citadel stock options prior to closing and (2) $30.00, minus (c) the cash value of dissenting shares (the “Cash Consideration Cap”), or (ii) issue in excess of 151,485,282 shares of Cumulus Media common stock, plus (b) the product of (1) the number of shares of Citadel Class A common stock issued upon exercise of Citadel stock options prior to closing and (2) 3.226 (the “Stock Consideration Cap”).


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Q: What will I receive for my Citadel warrants in the proposed merger?
 
A: Citadel warrant holders will have the right to elect to have their warrants adjusted to become the right to receive upon exercise:
 
  •  $37.00 in cash for each share of Citadel common stock underlying such warrant, subject to proration; or
 
  •  8.525 shares of Cumulus Media Class A common stock, subject to proration, and also subject to the right of Cumulus Media, in the exercise of its reasonable determination, to issue shares of Cumulus Media Class B common stock or warrants to acquire Cumulus Media Class A common stock or Cumulus Media Class B common stock if it determines that the issuance of its Class A common stock or Cumulus Media Class B common stock would cause Cumulus Media to be in violation of the Communications Act or FCC rules and policies.
 
The form of merger consideration that Citadel warrant holders actually receive may be adjusted as a result of the proration procedures pursuant to the merger agreement as described in this information statement/proxy statement/prospectus under “The Merger — Citadel Stockholders and Warrant Holders Making Cash and Stock Elections — Proration Procedures” on page  . These proration procedures are designed to ensure that Cumulus Media does not pay cash in excess of the Cash Consideration Cap or issue shares of Cumulus Media common stock in excess of the Stock Consideration Cap.
 
Q: How will Cumulus Media determine if a Citadel stockholder or warrant holder will receive Cumulus Media Class A common stock or Cumulus Media Class B common stock (or warrants to purchase shares of Cumulus Media Class A common stock or Cumulus Media Class B common stock) in the merger?
 
A: Shares of Cumulus Media Class B common stock (or warrants to purchase shares of Cumulus Media Class A common stock or Cumulus Media Class B common stock) will be issued by Cumulus Media to a Citadel stockholder or warrant holder if Cumulus Media reasonably determines that the issuance of its Class A common stock to such stockholder would result in the violation of the Communications Act or FCC rules and policies.
 
To assist Cumulus Media in determining whether it can issue shares of Cumulus Media Class A common stock without violating the Communications Act or FCC rules and policies in connection with an election to receive cash or stock consideration in the merger, each Citadel stockholder and warrant holder will be required to complete an ownership certification and a related FCC worksheet.
 
Q: What are the principal differences between Class A common stock and Class B common stock?
 
A: Cumulus Media Class A common stock and Class B common stock are generally equivalent in all respects, except that shares of Cumulus Media Class B common stock generally are not entitled to vote on matters put to a vote of Cumulus Media stockholders.
 
Q: How and when do I make a cash election or a stock election?
 
A: You should carefully review and follow the instructions accompanying the form of election provided together with this information statement/proxy statement/prospectus. To make a cash election or a stock election, Citadel stockholders and warrant holders of record must properly complete, sign and send the form of election and stock certificates (or evidence of shares in book-entry form) representing their Citadel shares to          , the exchange agent, at the following address:
 
             
By mail:
  By overnight courier:   By hand:   By facsimile transmission:
(for eligible institutions only)
             
            (Tel.)
             
            To confirm facsimile only:
(Tel.)


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Questions regarding the cash or share elections should be directed to          , the exchange agent, at          .
 
The exchange agent must receive the form of election and any stock certificates (or evidence of shares in book-entry form) representing Citadel common stock or a guarantee of delivery as described in the instructions accompanying the form of election, by the election deadline. Unless otherwise designated on the election form, the election deadline will be 5:00 p.m., New York City time, (i) ten business days preceding the anticipated merger closing date, or (ii) on such other date as Citadel and Cumulus Media mutually agree. Citadel and Cumulus Media will publicly announce the anticipated election deadline at least five business days prior to the election deadline.
 
If you hold Citadel shares in “street name” through a bank, broker or other nominee and you wish to make an election, you should seek instructions from the financial institution holding your shares concerning how to make your election.
 
Q: If I beneficially own Citadel shares held pursuant to the Citadel Broadcasting Corporation 2010 Equity Incentive Plan as of the record date, will I be able to vote on the adoption of the merger agreement and elect whether to receive cash or stock consideration?
 
A: Yes. Holders who beneficially own Citadel shares held pursuant to the Citadel Broadcasting Corporation 2010 Equity Incentive Plan (as it may be amended, supplemented or modified) (the “Citadel Plan”) as of the record date may vote on the adoption of the merger agreement and may elect whether to receive cash or stock consideration by following the instructions accompanying the form of election provided together with this information statement/proxy statement/prospectus.
 
Q: Can I change my election after the form of election has been submitted?
 
A: Yes, you may revoke your election prior to the election deadline by submitting a written notice of revocation to the exchange agent or by submitting new election materials. Revocations must specify the name in which your shares are registered on the stock transfer books of Citadel and such other information as the exchange agent may request. If you wish to submit a new election, you must do so in accordance with the election procedures described in this information statement/proxy statement/prospectus and the form of election. If you instructed a broker to submit an election for your shares, you must follow your broker’s directions for changing those instructions. Whether you revoke your election by submitting a written notice of revocation or by submitting new election materials, the notice or materials must be received by the exchange agent by the election deadline in order for the revocation to be valid.
 
Q: May I transfer Citadel shares and/or warrants after I make my election?
 
A: No. Citadel stockholders and warrant holders who have made elections will be unable to sell or otherwise transfer their shares after making the election, unless the election is properly revoked before the election deadline or unless the merger agreement is terminated.
 
Q: What if I do not send a form of election or it is not received?
 
A: If the exchange agent does not receive a properly completed form of election from you before the election deadline, together with any stock certificates (or evidence of shares in book-entry form) representing the shares you wish to exchange for cash or shares of Cumulus Media common stock, properly endorsed for transfer, book-entry transfer shares or a guarantee of delivery and any additional documents required by the procedures set forth in the form of election, then you will have no control over the type of merger consideration you receive. Citadel stockholders or warrant holders not making an election will receive the consideration choice selected for the majority of Citadel shares and warrants for which an election was properly made (or deemed made) and, as a result, your Citadel shares may be exchanged for cash consideration or stock consideration consistent with the proration procedures contained in the merger agreement and described under “The Merger — Citadel Stockholders and Warrant Holders Making Cash and Stock Elections — Proration Procedures” on page  . You bear the risk of delivery and should send any form of election by courier or by hand to the appropriate addresses shown in the form of election.


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If you do not make a valid election with respect to the Citadel shares or warrants you own of record, after completion of the merger, you will receive written instructions from the exchange agent on how to exchange your Citadel shares or warrants for the shares of Cumulus Media common stock and/or cash that you are entitled to receive in the merger as a non-electing Citadel stockholder or warrant holder.
 
Q: May I submit a form of election even if I do not vote to adopt the merger agreement?
 
A: Yes. You may submit a form of election even if you vote against the adoption of the merger agreement or abstain with respect to the adoption of the merger agreement.
 
Q: What do I need to do now?
 
A: After carefully reading and considering the information contained in this information statement/proxy statement/prospectus, please respond by completing, signing and dating the appropriate proxy card or voting instruction card and returning in the enclosed postage-paid envelope, or, if available, by submitting your voting instruction by telephone or through the Internet, as soon as possible so that your shares may be represented and voted at the Citadel annual meeting. If you hold shares registered in the name of a broker, bank or other nominee, that broker, bank or other nominee has enclosed, or will provide, a voting instruction for use in directing your broker, bank or other nominee how to vote those shares.
 
Q: Should I send in my stock certificates (or evidence of shares in book-entry form) with my proxy card or my form of election?
 
A: Please do NOT send your Citadel stock certificates (or evidence of shares in book-entry form) with your proxy card. You should send in your Citadel stock certificates (or evidence of shares in book-entry form) to the exchange agent with your form of election.
 
If you wish to make an election with respect to your Citadel shares, prior to the election deadline, you should send your completed, signed form of election together with your Citadel stock certificates (or evidence of shares in book-entry form), if any, properly endorsed for transfer, or a guarantee of delivery to the exchange agent as described in the form of election. If your shares are held in “street name,” you should follow your broker’s instructions for making an election with respect to your shares.
 
Q: Why am I being asked to consider and approve on a non-binding, advisory basis compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger?
 
A: The SEC recently has adopted new rules that require Citadel to seek a non-binding, advisory vote with respect to certain compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger (also known as “golden parachute” compensation).
 
Q: What will happen if Citadel stockholders do not approve the compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger?
 
A: Approval of the compensation that may be paid or become payable to Citadel’s named executive officers in connection with the merger is not a condition to completion of the merger. The vote with respect to the compensation that may be received by the named executive officers that is based on or otherwise relates to the merger is an advisory vote and will not be binding on Citadel. Therefore, if the merger is approved by the stockholders and completed, this “golden parachute” compensation will still be payable, if triggered, to the named executive officers, whether or not this vote on compensation is approved by the stockholders.
 
Q: If my shares are held in “street name” by a broker, bank or other nominee, will my broker, bank or other nominee vote my shares for me?
 
A: If you hold your shares in “street name” and do not provide voting instructions to your broker, your shares will not be voted on Proposals 1-4 (to the extent you would otherwise be entitled to vote on such proposals) because your broker does not have discretionary authority to vote on these Proposals. You should follow the directions your broker, bank or other nominee provides. Citadel shares that are not voted because


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you do not properly instruct your broker, bank or other nominee will have the effect of a vote against Proposal 1. Citadel shares that are not voted because you do not properly instruct your broker, bank or other nominee will have no effect on the outcome of Proposals 2, 3 or 4. Proposal 5, the ratification of the selection of Deloitte & Touche LLP as Citadel’s independent registered public accountants for the year ending December 31, 2011, is a discretionary matter and brokers will be permitted to vote uninstructed shares as to such matter.
 
Q: What if I do not vote?
 
A: If you fail to respond with a vote on Proposal 1, or if you respond and indicate that you are abstaining from voting on such Proposal, it will have the same effect as a vote against Proposal 1. To the extent you are entitled to vote on any of Proposals 2-5, if you fail to respond with a vote on any of such proposals, or if you respond and indicate that you are abstaining from voting on any of such proposals, it will have no effect on the outcome of Proposals 2-5.
 
Q: Am I entitled to appraisal rights under the DGCL instead of receiving cash consideration for my shares of Citadel common stock?
 
A: Yes. As a holder of Citadel common stock, you are entitled to exercise appraisal rights under Section 262 of the DGCL in connection with the merger if you take certain actions and meet certain conditions. See “The Merger — Appraisal Rights” on page   . In addition, a copy of Section 262 of the DGCL is attached to this information statement/proxy statement/prospectus as Annex G.
 
Q: What are the tax consequences to Citadel stockholders of the merger?
 
A: The receipt of the merger consideration in exchange for Citadel common stock in the merger will be a fully taxable transaction. Please review carefully the information under “The Merger — Material U.S. Federal Income Tax Consequences of the Merger” on page   , for a description of the material U.S. federal income tax consequences of the merger. The tax consequences to you will depend on your own situation. Please consult your tax advisors as to the specific tax consequences to you of the merger, including the applicability and effect of U.S. federal, state, local and foreign income and other tax laws in light of your particular circumstances.
 
Q: When is the merger expected to be completed?
 
A: Citadel expects the merger to be completed by the end of 2011. However, Citadel cannot be certain when, or if, the conditions to the merger will be satisfied or waived, or that the merger will be completed.
 
As more fully described in this information statement/proxy statement/prospectus and in the merger agreement, the completion of the merger depends on a number of conditions being satisfied or, where legally permissible, waived. These conditions include, among others, receipt of the requisite approval of Citadel stockholders, the expiration or termination of the waiting period under the HSR Act, the receipt of the FCC Approval, the approval for listing on the Nasdaq Stock Market of the Cumulus Media Class A common stock to be issued as stock consideration in the merger, the absence of any law or order prohibiting the merger or having certain material adverse effects on one or more of the parties to the merger, the correctness of all representations and warranties made by the parties in the merger agreement and performance by the parties of their obligations under the merger agreement (subject in each case to certain materiality standards).
 
Q: Are there risks associated with the merger that I should consider in deciding how to vote?
 
A: Yes. There are a number of risks related to the merger and the other transactions contemplated by the merger agreement that are discussed in this information statement/proxy statement/prospectus and in the documents incorporated by reference or referred to in this information statement/proxy statement/prospectus. Please read with particular care the detailed description of the risks described in “Risk Factors” beginning on page    and in Citadel and Cumulus Media SEC filings referred to in “Where You Can Find More Information” on page   .


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Q: Where can I find the voting results of the Citadel annual meeting?
 
A: The preliminary voting results will be announced at the Citadel annual meeting. In addition, within four business days following the Citadel annual meeting, Citadel intends to file the final voting results with the SEC on Form 8-K. If the final voting results have not been certified within that four-day period, Citadel will report the preliminary voting results on Form 8-K at that time and will file an amendment to the Form 8-K to report the final voting results within four days of the date that the final results are certified.
 
Q: Who can help answer my questions?
 
A: If you have any questions about the Citadel annual meeting, the matters to be voted upon, including the merger, or questions about how to submit your proxy or make an election, or if you need additional copies of this information statement/proxy statement/prospectus, the form of election or the enclosed proxy card or voting instruction card, you should contact          .
 
Questions and Answers for Cumulus Media Stockholders
 
Q: Why have I received this information statement/proxy statement/prospectus?
 
A: You have received this document because Cumulus Media’s board of directors is required to provide you a notice of certain stockholder approvals that have been received, and of certain actions to be taken, by Cumulus Media.
 
Q: What actions are going to be taken by Cumulus Media?
 
A: Assuming the merger agreement is approved and adopted by Citadel’s stockholders, and the merger is thereafter completed, Cumulus Media will pay cash and issue shares of Cumulus Media’s Class A common stock (or in certain instances, shares of Cumulus Media Class B common stock or warrants in lieu of Cumulus Media common stock) in the merger, issue its equity securities pursuant to the Investment Agreement, be able to issue equity awards under a new equity incentive plan and amend and restate its certificate of incorporation.
 
Q: Are Cumulus Media stockholders being asked to vote on any of these matters?
 
A: No. Certain stockholders of Cumulus Media, including Lewis W. Dickey, Jr., Cumulus Media’s Chairman, President and Chief Executive Officer and John W. Dickey, Jr., Cumulus Media’s Executive Vice President and Co-Chief Operating Officer, and the brother of Lewis W. Dickey, Jr., who, at all relevant times, collectively held a majority of the voting power of Cumulus Media’s outstanding common stock, have previously executed written stockholder consents approving each of these actions. Pursuant to the rules of the Nasdaq Stock Market and the DGCL, as applicable, no further action by Cumulus Media stockholders is required to effectuate these transactions.
 
Q: How many shares of Cumulus Media Class A common stock are going to be issued in the merger?
 
A: Pursuant to the merger agreement, Cumulus Media has agreed to issue up to 151,485,282 shares of Cumulus Media Class A common stock (plus an additional number of shares based on the number of shares of Citadel common stock that are issued upon the exercise of stock options to acquire Citadel common stock prior to the closing date of the merger), with the exact number of shares of Cumulus Media Class A common stock to be issued dependent upon elections to be made by the holders of Citadel common stock (and warrants to purchase Citadel common stock).
 
Q: In what instances would Cumulus Media issue shares of its Class B common stock or warrants in lieu of shares of Cumulus Media Class A common stock in the merger?
 
A: If Cumulus Media reasonably determines that the issuance of Cumulus Media Class A common stock to any Citadel stockholders would result or would be likely to result in the violation of the Communications Act or FCC rules and policies, Cumulus Media will issue an equal number of shares of Cumulus Media Class B common stock (or, in its discretion, warrants to purchase shares of Cumulus Media Class A common stock or shares of Cumulus Media Class B common stock) to those stockholders.


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Q: What are the principal differences between Cumulus Media Class A common stock and Cumulus Media Class B common stock?
 
A: Cumulus Media Class A common stock and Class B common stock are generally equivalent in all respects, except that shares of Cumulus Media Class B common stock generally are not entitled to vote on matters put to a vote of Cumulus Media stockholders.
 
Q: Why is Cumulus Media issuing shares of its stock pursuant to the Investment Agreement?
 
A: Cumulus Media is issuing shares of its stock pursuant to the Investment Agreement in order to obtain cash to pay a portion of the cash purchase price to complete the merger.
 
Q: How many shares of Cumulus Media stock are going to be issued under the Investment Agreement?
 
A: Pursuant to the Investment Agreement, the Investors have committed to purchase for cash up to an aggregate of $500.0 million in shares of Cumulus Media common stock, preferred stock, or warrants to purchase common stock, at a purchase price per common share (or warrant) of $4.34. As a result, Cumulus Media may issue up to 115,207,373 shares of Cumulus Media common stock, or warrants to purchase shares of Cumulus Media common stock pursuant to the Investment Agreement. Depending on the amount of cash elected to be received by Citadel stockholders in the merger, the Investors’ commitments may be reduced in accordance with the Investment Agreement, subject to a minimum aggregate investment of $395.0 million. In addition, under certain circumstances where Cumulus Media does not require Macquarie’s full investment to consummate the merger, Macquarie may elect to reduce its investment to the extent not so required.
 
Q: What class of Cumulus Media stock is going to be issued pursuant to the Investment Agreement?
 
A: Crestview has agreed to purchase up to $250.0 million in shares of Cumulus Media Class A common stock, and Macquarie and UBS Securities each have agreed to purchase up to $125.0 million in warrants, which will be immediately exercisable by U.S. persons, subject to the Communications Act and FCC rules and policies, at an exercise price of $0.01 per share, for shares of Cumulus Media Class B common stock. Macquarie may, at its option, elect to receive up to the full amount of its investment in shares of a newly created class of perpetual redeemable, non-convertible preferred stock, and will also be permitted to syndicate up to $45.0 million of its commitment to one or more third parties, subject to certain limitations set forth in the Investment Agreement. UBS Securities may syndicate all or any portion of its commitment to one or more third parties, subject to the same limitations set forth in the Investment Agreement. Third parties who are U.S. persons to whom Macquarie or UBS Securities syndicate a portion of their respective commitments may purchase shares of Cumulus Media Class A common stock instead of warrants.
 
Q: What other rights do the Investors have under the Investment Agreement?
 
A: Cumulus Media has agreed to enter into a registration rights agreement with the Investors pursuant to which Cumulus Media has agreed under certain circumstances and at certain times to file one or more registration statements with the SEC relating to the shares of Cumulus Media Class A common stock and Cumulus Media Class B common stock that the Investors, or third parties to whom Macquarie or UBS Securities may syndicate such shares, may acquire pursuant to the Investment Agreement, or upon the conversion of Cumulus Media Class B common stock or exercise of warrants for shares of Cumulus Media common stock. Cumulus Media has also agreed to enter into a stockholders agreement (the “Stockholders Agreement”) with the Investors and certain other stockholders, which will provide for certain rights and obligations of the parties relating to the nomination and election of directors and limitations on the acquisition and disposition of shares of Cumulus Media common stock, among other things.
 
Q: Why is Cumulus Media adopting a new equity incentive plan?
 
A: Pursuant to the terms and conditions of the Investment Agreement, Cumulus Media was required to approve and adopt a new equity incentive plan, and agreed that, in connection therewith, the remaining authorizations for equity awards under Cumulus Media’s existing equity incentive plans would be cancelled.


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Q: Why is Cumulus Media amending and restating its certificate of incorporation?
 
A: Cumulus Media is amending and restating its certificate of incorporation primarily to, among other things, provide for and set out the rights and limitations of various classes of securities which may be issuable in the merger and pursuant to the Investment Agreement, to increase the number of shares of stock Cumulus Media is authorized to issue in order to maintain flexibility for future business developments, to reclassify the current Cumulus Media Class D common stock as Cumulus Media Class B common stock, and to set out therein certain provisions regarding the governance of Cumulus Media.
 
Q: Are there risks associated with these matters that I should be aware of?
 
A: Yes. You should consider the risk factors set out in the section entitled “Risk Factors” beginning on page   of this document.
 
Q: Does Cumulus Media have any other significant transactions pending of which I should be aware?
 
A: On January 31, 2011, Cumulus Media entered into a share exchange agreement pursuant to which it agreed to acquire the 75% of the equity interests in CMP that it does not currently own. Cumulus Media has managed CMP’s business pursuant to a management agreement since 2006. This transaction is expected to be completed in August 2011.
 
For the three months ended March 31, 2011 and the year ended December 31, 2010, CMP had net revenues of $39.1 million and $188.7 million, respectively.
 
Q: Do I have dissenter’s rights or appraisal rights in connection with any of these transactions?
 
A: Holders of shares of Cumulus Media common stock are not entitled to any dissenter’s rights or appraisal rights under the DGCL in connection with the merger or the related transactions.
 
Q: Who can help answer my questions?
 
A: If you have any questions about any of these matters, including the merger, or if you need additional copies of this document, you should contact:
 
Cumulus Media Investor Relations
3280 Peachtree Road, N.W.
Suite 2300
Atlanta, Georgia 30305
Telephone: (404) 260-6600 or email jp.hannan@cumulus.com


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SUMMARY
 
This summary highlights selected information described in more detail elsewhere in this document and the documents incorporated herein by reference, and may not contain all of the information that is important to you. To understand the merger, the related transactions being undertaken by Cumulus Media and the other matters to be voted on by Citadel stockholders at the Citadel annual meeting more fully, and to obtain a more complete description of the legal terms of the merger agreement, you should carefully read this entire document, including the Annexes, and the documents to which Cumulus Media and Citadel refer you. Please see “Where You Can Find More Information” on page   .
 
Citadel Annual Meeting (See page   )
 
The Citadel annual meeting will be held at     , on          , 2011, starting at          , local time.
 
Holders of record at the close of business on          , 2011 (the “record date”), of Citadel Class A common stock will be entitled to notice of and to vote at the Citadel annual meeting with regard to Proposals 1-5. Holders of Citadel Class B common stock as of the record date will be entitled to notice of and to vote at the Citadel annual meeting, together with holders of Citadel Class A common stock as of the record date as a single class, with regard to Proposals 1 and 5. On the record date there were           total shares of Citadel common stock outstanding and entitled to vote at the Citadel annual meeting, held by approximately           holders of record. Each of the           shares of Citadel Class A common stock issued and outstanding on the record date is entitled to one vote at the Citadel annual meeting with regard to Proposals 1-5, and each of the           shares of Citadel Class B common stock issued and outstanding on the record date is entitled to one vote at the Citadel annual meeting with regard to Proposals 1 and 5.
 
As of the record date, Citadel directors and executive officers, as a group, owned and were entitled to vote           shares of Citadel Class A common stock, or approximately     % of the outstanding Citadel Class A common stock, and           shares of Citadel Class B common stock, or approximately     % of the outstanding Citadel Class B common stock, and together with Citadel Class A common stock, approximately     % of the outstanding shares of Citadel common stock. Citadel currently expects that its directors and executive officers will vote their shares in favor of Proposals 1, 2, 4 and 5, and in favor of each of the director nominees in Proposal 3, but none of Citadel’s directors or executive officers have entered into any agreement obligating them to do so.
 
The Transactions
 
Cumulus Media and Citadel, among others, have entered into the merger agreement. Cumulus Media stockholders are receiving these documents to inform them of the receipt by Cumulus Media of stockholder approval to issue the shares as contemplated by the merger agreement, to issue the shares pursuant to the Investment Agreement, to approve a new equity incentive plan and to amend and restate Cumulus Media’s certificate of incorporation.
 
Citadel stockholders are receiving this document in connection with Citadel’s solicitation of proxies for its annual meeting of stockholders. At Citadel’s annual meeting, its stockholders will be asked to vote to approve, among other things, the merger agreement.
 
Structure of the Merger (See page   )
 
Subject to the terms and conditions of the merger agreement and in accordance with the DGCL, at the effective time of the merger, Merger Sub will be merged with and into Citadel, with Citadel surviving the merger and becoming a wholly-owned indirect subsidiary of Cumulus Media. The effect of the merger will be that Citadel will be acquired by Cumulus Media and shares of Citadel common stock will no longer be publicly traded.


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The Parties
 
Cumulus Media Inc. (See page   )
 
Cumulus Media Inc.
3280 Peachtree Road, N.W.
Suite 2300
Atlanta, Georgia 30305
(404) 949-0700
 
Cumulus Media Inc., headquartered in Atlanta, Georgia, is the second largest radio broadcaster in the United States based on station count, controlling or operating approximately 346 radio stations in 68 U.S. media markets at March 31, 2011. In combination with its affiliate, CMP, Cumulus Media is the fourth largest radio broadcast company in the United States based on net revenues as of March 31, 2011.
 
Cumulus Media Holdings Inc. (f/k/a Cadet Holding Corporation) (See page   )
 
Cumulus Media Holdings Inc.
3280 Peachtree Road, N.W.
Suite 2300
Atlanta, Georgia 30305
(404) 949-0700
 
Cumulus Media Holdings Inc., a Delaware corporation, is a wholly-owned subsidiary of Cumulus Media that, upon consummation of the merger, will become the direct holding company of Citadel. Holdco was formed by Cumulus Media solely in contemplation of the merger, has not commenced any operations, has only nominal assets and has no liabilities or contingent liabilities, nor any outstanding commitments other than as set forth in the merger agreement.
 
Cadet Merger Corporation (See page   )
 
Cadet Merger Corporation
3280 Peachtree Road, N.W.
Suite 2300
Atlanta, Georgia 30305
(404) 949-0700
 
Cadet Merger Corporation, a Delaware corporation, is an indirect wholly-owned subsidiary of Cumulus Media and a direct wholly-owned subsidiary of Holdco. Merger Sub was formed by Cumulus Media to complete the merger. Merger Sub has not commenced any operations, has only nominal assets and has no liabilities or contingent liabilities, nor any outstanding commitments other than as set forth in the merger agreement. In the merger, Merger Sub will merge with and into Citadel and Merger Sub will cease to exist.
 
Citadel Broadcasting Corporation (See page   )
 
Citadel Broadcasting Corporation
7690 W. Cheyenne Avenue
Suite 220
Las Vegas, Nevada 89129
(702) 804-5200
 
Citadel Broadcasting Corporation, headquartered in Las Vegas, Nevada, is the third largest radio broadcasting company in the United States based on net radio revenue as of March 31, 2011, behind Clear Channel Communications, Inc. and CBS Corporation. Citadel operates in two reportable segments. Radio stations serving the same geographic area (i.e., principally a city or combination of cities) that are owned and/or operated by Citadel are referred to as a market, and Citadel aggregates the geographic markets in which it operates into one reportable segment (“Radio Markets”). Citadel’s primary business segment is the Radio


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Markets segment, which, as of March 31, 2011, consisted of 225 owned and operated radio stations located in over 50 markets across the United States. Citadel also owns and operates Citadel Media (“Radio Network”), one of the largest radio networks in the country, which produces and distributes a variety of radio programming and formats that are syndicated across approximately 4,000 station affiliates and 9,000 program affiliations, and is a separate reportable segment.
 
Cumulus Media’s Board of Directors’ Reasons for the Merger (See page   )
 
In the course of reaching its decision to approve the merger agreement and the transactions contemplated thereby, the Cumulus Media board of directors considered a number of factors in its deliberations. Those factors are described in “The Merger — Cumulus Media’s Reasons for the Merger” on page   .
 
Citadel Board of Directors’ Reasons for the Merger (See page   )
 
In the course of reaching its decision to approve the merger agreement and the transactions contemplated thereby, Citadel’s board of directors considered a number of factors in its deliberations. Those factors are described in “The Merger — Recommendation of Citadel’s Board of Directors and Citadel’s Reasons for the Merger” on page   .
 
The Merger Agreement (See page   )
 
A copy of the merger agreement is attached as Annex A to this document. Cumulus Media and Citadel encourage you to read the entire merger agreement carefully because it is the principal document governing the merger.
 
Merger Consideration (See page   )
 
Upon completion of the merger, each share of Citadel common stock outstanding immediately prior to completion of the merger (other than shares held by Citadel stockholders who validly exercise appraisal rights under the DGCL with respect to such shares) will be canceled and automatically converted into the right to receive (i) $37.00 in cash, (ii) 8.525 shares of Cumulus Media Class A common stock, or (iii) a combination of cash and Cumulus Media Class A common stock, in each case subject to proration. The proration procedures are designed to ensure that Cumulus Media does not pay cash in excess of the Cash Consideration Cap or issue shares in excess of the Stock Consideration Cap.
 
Based on the closing price of Cumulus Media Class A common stock on the Nasdaq Global Select Market on March 9, 2011, the last trading day prior to the public announcement of the merger, the exchange ratio represented approximately $37.00 in cash or $43.48 in value of Cumulus Media Class A common stock for each share of Citadel common stock. Based on the closing price of Cumulus Media Class A common stock on the Nasdaq Global Select Market on        , 2011, the latest practicable date before the date of this document, the exchange ratio represented approximately $37.00 in cash or $      in value of Cumulus Media Class A common stock for each share of Citadel common stock. Cumulus Media will not issue any fractional shares of Cumulus Media Class A common stock in the merger. Holders of Citadel common stock who would otherwise be entitled to a fractional share of Cumulus Media Class A common stock will receive a cash payment in lieu of fractional shares. Shares of Cumulus Media Class A common stock outstanding before the merger is completed will remain outstanding and will not be exchanged, converted or otherwise changed in the merger.
 
If Cumulus Media determines that the issuance of Cumulus Media Class A common stock to a holder of Citadel common stock or warrants would, or would be reasonably likely to, cause Cumulus Media to violate the Communications Act or FCC rules and policies, then, in lieu of the issuance of such shares, Cumulus Media may issue to such stockholder or warrant holder an equal number of shares of Cumulus Media Class B common stock or, in its discretion, warrants to acquire an equal number of shares of Cumulus Media Class A common stock or Cumulus Media Class B common stock.
 
Shares of Cumulus Media Class A common stock and Cumulus Media Class B common stock (and warrants therefor) are treated equally for accounting purposes, with the distinctions relating only to certain


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voting restrictions and conversion mechanisms utilized to ensure compliance with the Communications Act and FCC rules and policies.
 
Treatment of Citadel Warrants in the Merger (See page   )
 
In the merger, holders of warrants to purchase Citadel Class B common stock will have the right to choose between having such Citadel warrants adjusted at the effective time of the merger into the right to receive upon exercise of such Citadel warrant either $37.00 in cash or 8.525 shares of Cumulus Media Class A common stock, subject to the same proration as described above. These proration limitations are designed to ensure that Cumulus Media does not pay cash in excess of the Cash Consideration Cap or issue shares of Cumulus Media Class A common stock or Cumulus Media Class B common stock, or warrants therefor, in excess of the Stock Consideration Cap in the merger.
 
Treatment of Citadel Stock Options and Citadel Restricted Stock in the Merger (See page   )
 
Citadel Stock Options.  At least twenty business days prior to the consummation of the merger, each unvested and outstanding option to purchase shares of Citadel Class A common stock under the Citadel Plan will become fully vested and exercisable and shall terminate upon the consummation of the merger. If any option is not exercised on or prior to the date that is ten business days prior to the consummation of the merger, upon the consummation of the merger such outstanding option will be deemed exercised for that number of shares of Citadel Class A common stock equal to (x) the number of shares of Citadel Class A common stock subject to such option minus (y) the number of shares of Citadel Class A common stock subject to such option which, when multiplied by the fair market value (as defined in the Citadel Plan) of a share of Citadel Class A common stock as of the day that is one business day before the date the merger is consummated, is equal to the aggregate exercise price of such option. Pursuant to the merger agreement, each resulting share of Citadel Class A common stock will be converted into the right to receive the type of consideration selected for the majority of Citadel shares and warrants for which an election was properly made (or deemed made), subject to proration as described above; provided, that any resulting fractional shares will be converted into a cash amount equal to the product obtained by multiplying the fractional interest by $4.34.
 
Citadel Restricted Stock.  Upon the consummation of the merger, each restricted stock award outstanding immediately prior to the consummation of the merger will be converted into a right to receive cash or Cumulus Media Class A common stock or Cumulus Media Class B common stock, or warrants therefor, determined in accordance with the terms of the merger agreement and at the election of the holder on the same terms and conditions as were applicable to such award immediately prior to the consummation of the merger and will be payable at the time such restricted stock award vests. In addition, upon consummation of the merger, each restricted stock award will vest in full upon the termination by Citadel of service thereto by the holder without cause (as such term is defined in the Citadel Plan) or by the holder for good reason (as such term is defined in the Citadel Plan assuming no other agreement or arrangement supersedes such definition). Pursuant to the merger agreement, each resulting fractional share of Cumulus Media Class A common stock will be rounded down to the nearest whole share and any fractional share of Cumulus Media Class A common stock not awarded due to such rounding will be converted into a cash amount, payable at the time such restricted stock award vests, equal to the product obtained by multiplying the fractional interest by $4.34.
 
Opinion of Cumulus Media’s Financial Advisor (See page   )
 
On March 9, 2011, at a meeting of the Cumulus Media board of directors held to evaluate the merger agreement and the transactions contemplated thereby, Moelis & Company (“Moelis”) delivered its oral opinion, which was later confirmed in writing, that based upon and subject to the conditions and limitations and qualifications set forth in its written opinion, as of March 9, 2011, the exchange ratio resulting from the merger and the Equity Investment was fair, from a financial point of view, to Cumulus Media.
 
The full text of Moelis’ written opinion, dated March 9, 2011, which sets forth the assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the


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opinion is attached as Annex C to this information statement/proxy statement/prospectus and is incorporated herein by reference. Moelis’ opinion is limited solely to the fairness of the exchange ratio and the Equity Investment from a financial point of view as of the date of the opinion and does not address Cumulus Media’s underlying business decision to effect the transactions contemplated by the merger agreement or the relative merits of the merger as compared to any alternative business strategies or transactions that might be available to Cumulus Media. Moelis’ opinion does not constitute a recommendation to any Cumulus Media stockholder as to how such stockholder should act with respect to the merger or any other matter. Cumulus Media stockholders are encouraged to read Moelis’ opinion, and the description thereof, carefully and in its entirety. You are urged to read the opinion in its entirety. See “The Merger — Opinion of Cumulus Media’s Financial Advisor” on page   .
 
Co-Financial Advisors to the Citadel Board of Directors (See page   )
 
Citadel retained Lazard Frères & Co. LLC (“Lazard”), and J.P. Morgan Securities LLC (“J.P. Morgan” and, together with Lazard, the “Co-Financial Advisors”) as financial advisors in connection with evaluation of a range of possible transactions including the merger and, if requested, to render an opinion to the board of directors of Citadel as to the fairness, from a financial point of view, to holders of Citadel common stock of the consideration to be paid to such holders in any transaction within the scope of their respective engagement letters. As a result of J.P. Morgan providing a commitment with respect to the financing of the merger, only Lazard rendered an opinion to the board of directors of Citadel as to fairness.
 
Opinion of Lazard to the Citadel Board of Directors (See page   )
 
Lazard rendered its oral opinion to the Citadel board of directors, subsequently confirmed in writing, that, as of March 9, 2011, and based upon and subject to the assumptions, procedures, factors, qualifications and other matters and limitations set forth in Lazard’s opinion, the consideration to be paid to holders of Citadel common stock (other than Merger Sub, Citadel (with respect to treasury shares) and such holders who are entitled to and properly demand an appraisal of their shares of Citadel common stock) in the merger was fair from a financial point of view to such holders. For purposes of its opinion, with the consent of Citadel, Lazard assumed that all Citadel warrants had been exercised for shares of Citadel Class B common stock pursuant to the terms of the Citadel warrants. In addition, for purposes of its opinion, with the consent of Citadel, Lazard treated the shares of Citadel Class A common stock as equivalent to the shares of Citadel Class B common stock from a financial point of view.
 
The full text of Lazard’s written opinion, dated March 9, 2011, which sets forth the assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with Lazard’s opinion, is attached to this information statement/proxy statement/prospectus as Annex B. Lazard provided its opinion to the Citadel board of directors in connection with its evaluation of the merger. Lazard’s opinion is not a recommendation as to how any holder of Citadel common stock should vote or act with respect to the merger or any matter relating thereto. Lazard will receive a fee for its services, a portion of which has already been paid, and a significant portion of which will be payable upon consummation of the merger. Cumulus Media and Citadel encourage you to read the opinion, which is attached to this information statement/proxy statement/prospectus as Annex B, and the description thereof in the section titled “The Merger — Co-Financial Advisors to the Citadel Board of Directors — Opinion of Lazard to the Citadel Board of Directors” beginning on page     , carefully and in their entirety.
 
Interests of Certain Citadel Directors and Officers in the Merger (See page   )
 
You should be aware that Citadel’s executive officers and directors have economic interests in the merger that are different from, or in addition to, those of Citadel’s stockholders generally. These interests include, but are not limited to: the treatment of equity awards held by executive officers and directors (including the acceleration of vesting of stock options and the treatment of restricted stock); the payment of pro-rated annual bonuses to executive officers at the target level of achievement for the year in which the merger is consummated; the potential acceleration of supplemental retirement benefits for Mr. Suleman; the potential


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payment of severance and other benefits to executive officers; and the potential payment of tax gross-ups to certain executive officers.
 
Accounting Treatment of the Merger (See page   )
 
The merger of the two companies will be accounted for by Cumulus Media as a business combination under the acquisition method of accounting.
 
Material U.S. Federal Income Tax Consequences of the Merger (See page   )
 
If you are a Citadel stockholder that is a U.S. holder, the merger is generally expected to be treated as a taxable transaction to you, and you are generally expected to recognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference, if any, between (i) the sum of (a) the fair market value, at the time of the merger, of any Cumulus Media Class A common stock, Cumulus Media Class B common stock, or warrants therefor, received in the merger, plus (b) the amount of any cash received in the merger and (ii) your adjusted tax basis in the shares of Citadel common stock you own immediately prior to the merger.
 
Any such gain or loss will generally be long-term capital gain or loss if the U.S. holder’s holding period in the shares of Citadel common stock immediately prior to the merger is more than one year. The amount and character of gain or loss must be calculated separately for each identifiable block of shares of Citadel common stock surrendered. For U.S. holders that are individuals, long-term capital gain is generally taxed at preferential U.S. federal rates (currently 15%). The deductibility of capital losses is subject to certain limitations. Each U.S. holder is urged to consult its tax advisor regarding the manner in which gain or loss should be calculated as a result of the merger.
 
The U.S. holder’s tax basis in any shares of Cumulus Media Class A common stock, Cumulus Media Class B common stock, or warrants therefor, received in the merger will equal the fair market value of such shares or warrants at the time of the merger and the holding period for such shares or warrants will begin on the date immediately following the merger.
 
The U.S. federal income tax consequences described above may not apply to all holders of Citadel common stock. Your tax consequences will depend on your individual situation. Accordingly, Cumulus Media and Citadel strongly urge you to consult your own tax advisor for a full understanding of the particular tax consequences of the merger to you, including the applicability and effect of state, local and non-U.S. tax laws.
 
Board of Directors and Management After the Merger (See page   )
 
At the effective time of the merger, the board of directors of the surviving corporation will consist of the directors of Merger Sub. Also at the effective time, the officers of the surviving corporation will consist of the officers of Merger Sub.
 
Conditions to the Completion of the Merger (See page   )
 
Cumulus Media and Citadel currently expect to complete the merger by the end of 2011, subject to receipt of required stockholder and regulatory approvals and the satisfaction of waiver of the conditions to the merger. As more fully described in this document and in the merger agreement, each party’s obligation to complete the merger depends on a number of conditions being satisfied or, where legally permissible, waived, including the following:
 
  •  the adoption by the Citadel stockholders of the merger agreement;
 
  •  the authorization of the shares of Cumulus Media Class A common stock for listing on the Nasdaq Stock Market;
 
  •  the expiration or termination of any applicable waiting periods under the HSR Act;
 
  •  the granting of FCC Approval without any conditions which would have a material adverse effect on Cumulus Media and Citadel on a combined basis after the merger is completed;


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  •  the effectiveness of the registration statement for the issuance of Cumulus Media’s securities in the merger;
 
  •  the passing of 20 business days from the time this document was mailed to Cumulus Media stockholders; and
 
  •  the absence of any legal injunction, restraint or prohibition on the consummation of the merger.
 
The obligation of Cumulus Media, Holdco and Merger Sub to complete the merger is subject to the following additional conditions:
 
  •  the accuracy of the representations and warranties of Citadel, subject to certain materiality standards as described under “The Merger Agreement,” on page   , and receipt of a certificate signed on behalf of Citadel by its Chief Executive Officer or Chief Financial Officer to that effect;
 
  •  the performance by Citadel in all material respects of its obligations under the merger agreement and receipt of a certificate signed on behalf of Citadel by its Chief Executive Officer or Chief Financial Officer to that effect; and
 
  •  the absence of a material adverse effect on Citadel.
 
The obligation of Citadel to complete the merger is subject to the following additional conditions:
 
  •  the accuracy of the representations and warranties of Cumulus Media, Holdco and Merger Sub, subject to certain materiality standards as described under “The Merger Agreement,” on page   , and receipt of a certificate signed on behalf of Cumulus Media, Holdco and Merger Sub by the Chief Executive Officer or Chief Financial Officer of Cumulus Media to that effect;
 
  •  the performance by Cumulus Media, Holdco and Merger Sub in all material respects of their obligations under the merger agreement and receipt of a certificate signed on behalf of Cumulus Media, Holdco and Merger Sub by the Chief Executive Officer or Chief Financial Officer of Cumulus Media to that effect; and
 
  •  the absence of a material adverse effect on Cumulus Media, Holdco and Merger Sub.
 
Regulatory Approvals Required to Complete the Merger (See page   )
 
Cumulus Media and Citadel have agreed to cooperate and use reasonable best efforts to obtain all regulatory approvals required to complete the transactions contemplated by the merger agreement. For an acquisition meeting certain size thresholds, such as the merger, the HSR Act requires the parties to file notification and report forms with the Federal Trade Commission, referred to in this document as the “FTC,” and the Antitrust Division of the United States Department of Justice, referred to in this document as the “DOJ,” to observe specified waiting period requirements before consummating the acquisition, and to obtain prior approval of the FCC. The FCC could rely on any petitions or other objections that are filed, or its own initiative, to deny an FCC Application, to require changes in the transaction documents relating to those FCC Applications, including divestiture of radio stations and other assets, or impose other conditions to the grant of any of the FCC Applications. For these and other reasons, there can be no assurance that the FCC will grant the FCC Approval. Cumulus Media and Citadel intend to file required notifications with the Antitrust Division of the DOJ and the FTC. The waiting period under the HSR Act is expected to expire on          , unless each party receives notice of termination of the waiting period before that date or unless the reviewing agency extends the period by issuing a request for additional information (a “Second Request”). The termination of the waiting period upon the issuance of a Second Request may be subject to compliance with certain conditions.
 
Under the Communications Act, the FCC must approve the assignments and transfers of control required by the merger of Citadel (which has 228 full-power radio broadcast stations licensed to indirect wholly-owned subsidiaries of Citadel) with a subsidiary of Cumulus Media (which has 305 full-power radio broadcast stations licensed to an indirect wholly-owned subsidiary of Cumulus Media), which may include the 34 radio stations licensed to subsidiaries of CMP (which will become a wholly-owned subsidiary of Cumulus Media pursuant to the CMP Acquisition). Cumulus Media and Citadel filed FCC Applications on behalf of their


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respective subsidiaries with the FCC in March 2011. Those FCC Applications included proposals to assign certain radio stations currently held by each of Cumulus Media, CMP and Citadel to an independently-owned and operated trust in order to assure the FCC that, after the merger, Cumulus Media would be in compliance with provisions of the Communications Act and FCC rules that limit the number of radio stations a party may own in a particular market.
 
Termination of the Merger Agreement (See page   )
 
The merger agreement may be terminated without completing the merger, whether before or after a meeting of Citadel stockholders to vote on the merger, as follows:
 
  •  by the mutual consent of Citadel and Cumulus Media;
 
  •  by either Citadel or Cumulus Media, if:
 
  •  the merger has not been consummated by March 8, 2012 (or June 8, 2012, if all conditions have been satisfied by March 8, 2012 other than those pertaining to the HSR Act or the FCC Approval);
 
  •  a governmental entity has issued a final and non-appealable law or order or taken any other final and non-appealable action enjoining or prohibiting the merger;
 
  •  Citadel’s stockholders do not adopt the merger agreement, which includes the merger, payment of the merger consideration and the other transactions contemplated by the merger agreement; or
 
  •  the FCC issues a decision which denies the FCC Applications for FCC Approval or designates them for an evidentiary hearing.
 
  •  by Citadel:
 
  •  upon a breach of any material covenant or agreement of Cumulus Media, Holdco or Merger Sub, or any failure of any representations or warranties of Cumulus Media, Holdco or Merger Sub to be true and accurate that constitutes, in the aggregate, a material adverse effect on Cumulus Media (ignoring for such purposes any reference to material adverse effect or materiality contained in such representation or warranty), which, in each case, is incapable of being cured or will not have been cured within 30 days of receiving written notice of such breach or failure, to be true and accurate, as applicable;
 
  •  prior to Citadel’s stockholders adopting the merger agreement, in order to concurrently enter into an alternative transaction agreement with respect to a superior proposal; or
 
  •  if the merger has not been consummated by the termination date.
 
  •  by Cumulus Media:
 
  •  upon a breach of any material covenant or agreement of Citadel, or any failure of representations or warranties of Citadel to be true and accurate that constitutes, in the aggregate, a material adverse effect on Citadel (ignoring for such purposes any reference to material adverse effect or materiality contained in such representation or warranty), which, in each case is incapable of being cured or will not have been cured within 30 days of receiving written notice of such breach or failure to be true and accurate, as applicable; or
 
  •  if Citadel withdraws or modifies its recommendation to Citadel stockholders, fails to call and conduct a meeting of Citadel stockholders to vote on the adoption of the merger agreement or materially breaches its obligation under the merger agreement not to solicit alternative transaction proposals.
 
Expenses and Termination Fees Relating to the Merger (See page   )
 
Generally, all fees and expenses incurred in connection with the merger agreement and the transactions contemplated by the merger agreement will be paid by the party incurring those expenses, except that Cumulus Media and Citadel will each pay one-half of the costs and expenses incurred in connection with the filing, printing and mailing of this document and all fees required by the FCC for the filing of the FCC Applications. Cumulus Media will pay the fees, costs and expenses incurred in connection with all filings pursuant to the HSR Act.


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Following termination of the merger agreement under specified circumstances, Cumulus Media, Crestview and Macquarie may each be required to pay Citadel a portion of a termination fee of $60.0 million and, under certain circumstances, Cumulus Media may be required to pay Citadel an additional termination fee of $20.0 million. Following termination of the merger agreement under specified other circumstances, Citadel may be required to pay Cumulus Media a termination fee of up to $80.0 million.
 
Comparison of the Rights of Holders of Cumulus Media Common Stock and Citadel Common Stock (See page   )
 
As a result of the merger, the holders of Citadel common stock who elect to receive stock in the merger, or who receive stock in the merger as a result of proration as provided for in the merger agreement, will generally become holders of Cumulus Media Class A common stock. Each of Cumulus Media and Citadel is a Delaware corporation governed by the DGCL, but the rights of Cumulus Media stockholders from and after the merger will be governed by a third amended and restated certificate of incorporation of Cumulus Media (the “Third Amendment and Restatement”), which will be filed with the Delaware Secretary of State in connection with the completion of the merger and is described in more detail elsewhere herein, and the amended and restated by-laws of Cumulus Media (the “Cumulus Media Bylaws”), while the rights of Citadel stockholders are currently governed by the fourth amended and restated certificate of incorporation of Citadel (the “Citadel Charter”) and amended and restated bylaws of Citadel (the “Citadel Bylaws”). This document includes summaries of the material differences between the rights of Citadel stockholders and Cumulus Media stockholders arising because of difference in the certificates of incorporation and bylaws of the two companies.
 
Appraisal Rights in Connection with the Merger (See page   )
 
Under the DGCL, any Citadel stockholder who does not wish to accept the merger consideration and who does not vote in favor of the adoption of the merger agreement has the right to dissent from the merger and seek an appraisal of, and to be paid the fair value (exclusive of any element of value arising from the accomplishment or expectation of the merger) for his or her share of Citadel common stock, so long as the stockholder complies with the provisions of Section 262 of the DGCL. A person having a beneficial interest in shares of Citadel common stock held of record in the name of another person, such as a broker or nominee, must act promptly to cause the record holder to follow the steps summarized in this document and in a timely manner to perfect appraisal rights.
 
Cumulus Media stockholders are not entitled to any appraisal rights in connection with the merger.
 
The Equity Investment (See page   )
 
Concurrently with the execution of the merger agreement, Cumulus Media entered into the Investment Agreement with Crestview and Macquarie, which agreement has subsequently been amended and restated to add UBS Securities as a party. Pursuant to the Investment Agreement, the Investors have committed to purchase for cash up to an aggregate of $500.0 million in shares of Cumulus Media common stock, preferred stock, or warrants to purchase Cumulus Media common stock, at a purchase price per share (or warrant) of $4.34. Specifically, Crestview has agreed to purchase up to $250.0 million in shares of Cumulus Media’s Class A common stock and Macquarie and UBS Securities have each agreed to purchase up to $125.0 million in warrants, which will be immediately exercisable by U.S. persons, subject to the Communications Act and FCC rules and policies, at an exercise price of $0.01 per share, for shares of Cumulus Media Class B common stock. Macquarie may, at its option, elect to instead receive shares of a newly created class of perpetual redeemable non-convertible preferred stock. Macquarie and UBS Securities will also be permitted to syndicate up to $45.0 million and $125.0 million, respectively, of their respective commitments to one or more third party investors, subject to certain limitations set forth in the Investment Agreement. Third parties who are U.S. persons to whom Macquarie or UBS Securities syndicate a portion of their respective commitments may purchase shares of Cumulus Media Class A common stock instead of warrants. If the merger consideration is not paid at the Cash Consideration Cap, the Investors’ commitments will be reduced in accordance with the Investment Agreement, subject to a minimum aggregate investment of $395.0 million. In addition, under


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certain circumstances where Cumulus Media does not require Macquarie’s full investment to consummate the merger, Macquarie may elect to reduce its investment to the extent not so required.
 
In connection with entering into the Investment Agreement, Cumulus Media has agreed to enter into a registration rights agreement with the Investors pursuant to which Cumulus Media will agree, under certain circumstances and at certain times, to file one or more registration statements with the SEC relating to the shares of Cumulus Media Class A common stock or Cumulus Media Class B common stock that the Investors, or third parties to whom Macquarie or UBS Securities may syndicate such shares, may acquire pursuant to the Investment Agreement, or upon the conversion of Cumulus Media Class B common stock or exercise of warrants for shares of Cumulus Media Class A common stock or Class B common stock. Cumulus Media, the Investors and certain of Cumulus Media’s other stockholders have also agreed to enter into the Stockholders Agreement, which will provide for certain rights and obligations of the parties thereto, including relating to the nomination and election of directors and limitations on the acquisition of additional shares, or disposition of shares, of Cumulus Media stock, among other things. Specifically, the Stockholders Agreement will acknowledge that, as of the closing of the Equity Investment, in accordance with the Cumulus Media Bylaws, Cumulus Media’s board of directors will be set at seven directors. The two vacancies on the Cumulus Media board of directors created thereby will be filled with individuals designated by Crestview, one of whom will be appointed as the lead director of the board. Thereafter, under the Stockholders Agreement, Crestview will be entitled to designate two individuals for nomination to Cumulus Media’s board of directors, one of which will be appointed as the lead director of Cumulus Media’s board of directors, and each of the Dickeys, as a group, the BofA Entities, and Blackstone FC Communications Partners L.P. (“Blackstone”), will be entitled to designate one individual for nomination to Cumulus Media’s board of directors (with the two remaining directors initially to be Cumulus Media’s two current independent directors). Further, the parties to the Stockholders Agreement (other than Cumulus Media) will agree to support such individuals (or others as may be designated by the relevant stockholders) as nominees to be presented to Cumulus Media’s stockholders for approval at subsequent stockholder meetings for the term set out in the Stockholders Agreement. As used herein, the “Dickeys” means, collectively, Lewis W. Dickey, Jr., Cumulus Media’s Chairman, President and Chief Executive Officer, John W. Dickey, Cumulus Media’s Executive Vice President and Co-Chief Operating Officer and the brother of Lewis W. Dickey, Jr., their brothers David W. Dickey and Michael W. Dickey, and their father, Lewis W. Dickey, Sr., and the “BofA Entities” means, together, BA Capital Company, L.P. (“BA Capital”) and Banc of America Capital Investors SBIC, L.P. (“BACI”).
 
Adoption of the 2011 Equity Incentive Plan (See page   )
 
In accordance with the Investment Agreement, Cumulus Media’s board of directors and stockholders have approved a new equity incentive plan pursuant to which Cumulus Media will be able to issue equity awards representing up to 35 million shares of Cumulus Media common stock. Upon the effectiveness of this new equity incentive plan, the remaining authorization for equity awards under Cumulus Media’s currently existing equity incentive plans will be canceled. Upon the closing of the merger, Cumulus Media expects that it will issue to certain of its officers and employees stock options exercisable for up to 23 million shares of Cumulus Media common stock, with each option having an exercise price of $4.34 per share. Specific awards will be issued in amounts authorized by the compensation committee of Cumulus Media’s board of directors and, for the initial issuances under the equity incentive plan, approved by a majority (in commitment amount) of the Investors.
 
Amendment and Restatement of Cumulus Media’s Certificate of Incorporation (See page   )
 
In connection with the completion of the merger, Cumulus Media will amend and restate its certificate of incorporation. The amendment and restatement will be undertaken primarily to increase the authorized number of shares to provide sufficient authorized shares to complete the merger and to provide greater flexibility in Cumulus Media’s capital structure following the merger, to eliminate certain rights of the holder of Cumulus Media Class C common stock, to modify the current Cumulus Media Class B common stock and its related consent rights and to reclassify the current Cumulus Media Class D common stock as Cumulus Media Class B common stock. Cumulus Media has obtained the approval of the holders of a majority of its outstanding voting power to such amendment and restatement.


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RISK FACTORS
 
In addition to the other information included in and incorporated by reference into this information statement/proxy statement/prospectus, including the matters addressed under the caption “Cautionary Statement Regarding Forward-Looking Statements” on page   , you should carefully read and consider the following risk factors in evaluating the proposals to be voted on at the Citadel annual meeting and in determining whether to vote for adoption of the merger agreement. Please also refer to the additional risk factors of each of Cumulus Media and Citadel identified in the periodic reports and other documents incorporated by reference into this information statement/proxy statement/prospectus. See “Where You Can Find More Information” beginning on page   .
 
Risks Relating to the Merger
 
Cumulus Media may not realize the expected benefits of the merger because of integration difficulties and other challenges.
 
The success of the merger will depend, in part, on Cumulus Media’s ability to realize the anticipated synergies and cost savings from integrating Citadel’s business with its existing business. The integration process may be complex, costly and time-consuming. The difficulties of integrating the operation of Citadel’s business include, among others:
 
  •  failure to implement Cumulus Media’s business plan for the combined business;
 
  •  unanticipated issues in integrating logistics, information, communications and other systems;
 
  •  unanticipated changes in applicable laws and regulations;
 
  •  the impact on Cumulus Media’s internal controls and compliance with the regulatory requirements under the Sarbanes-Oxley Act of 2002; and
 
  •  unanticipated issues, expenses and liabilities.
 
Cumulus Media may not accomplish the integration of Citadel’s business smoothly, successfully or within the anticipated costs or time frame. The diversion of the attention of management from Cumulus Media’s current operations to the integration effort and any difficulties encountered in combining operations could prevent Cumulus Media from realizing the full benefits anticipated to result from the merger and could adversely affect its business. In addition, the integration efforts could divert the focus and resources of the management of Cumulus Media and Citadel from other strategic opportunities and operational matters during the integration process.
 
If Cumulus Media is unable to finance the merger, the merger will not be completed and Cumulus Media, Crestview and Macquarie will each be obligated to pay Citadel a portion of a termination fee of $60.0 million and, under certain circumstances, Cumulus Media may be required to pay Citadel an additional termination fee of $20.0 million (which portion, in Cumulus Media’s case, in the aggregate, could be up to $47.2 million) under the merger agreement.
 
Cumulus Media currently has obtained commitments for up to $500.0 million in equity financing and up to $2.415 billion in senior secured credit facilities, the proceeds of which Cumulus Media intends to use, in part, to pay the cash portion of the consideration payable in connection with the merger. Cumulus Media has not, however, entered into the definitive agreements for this financing. In the event Cumulus Media is unable to enter into such definitive agreements on the proposed terms, alternative financing may not be available on acceptable terms in a timely manner, or at all. If alternative financing becomes necessary and Cumulus Media is unable to secure such alternative financing, the merger will not be completed.
 
In the event of a termination of the merger agreement due to Cumulus Media’s inability to obtain the necessary financing to complete the merger, Cumulus Media, Crestview and Macquarie will each be obligated to pay Citadel a portion of a termination fee of $60.0 million and, under certain circumstances, Cumulus Media may be required to pay Citadel an additional termination fee of $20.0 million (which, in Cumulus


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Media’s case, in the aggregate, could be up to $47.2 million) under the merger agreement, which could have a material adverse effect on Cumulus Media’s operating results and financial condition.
 
Cumulus Media will take on substantial additional long-term indebtedness in connection with the merger and other pending transactions, which will increase the risks Cumulus Media now faces with its current indebtedness.
 
Cumulus Media intends to finance the merger, and refinance CMP’s and Citadel’s existing indebtedness, with up to $2.415 billion in senior secured debt financing. As a result, Cumulus Media will have long-term indebtedness that will be substantially greater than its long-term indebtedness prior to the merger and refinancing. This new indebtedness will increase the related risks Cumulus Media now faces with its current indebtedness.
 
Citadel is subject to business uncertainties and contractual restrictions while the merger is pending.
 
Uncertainty about the effect of the pending merger on Citadel employees and customers may have an adverse effect on Citadel. These uncertainties may impair Citadel’s ability to attract, retain and motivate key personnel until the merger is completed, and could cause customers and others that deal with Citadel to defer decisions concerning Citadel, or to seek to change existing business relationships with Citadel. If key employees depart because of uncertainty about their future roles and the potential complexities of integration, Citadel’s business, or the combined company’s business following the merger, could be harmed. In addition, the merger agreement restricts Citadel from making acquisitions or dispositions and taking other specified actions without the consent of Cumulus Media until the merger occurs. These restrictions may prevent Citadel from pursuing attractive business opportunities or addressing other developments that may arise prior to the completion of the merger.
 
Failure to complete the merger could negatively affect the stock price and the future business and financial results of Citadel.
 
Consummation of the merger is conditioned, among other things, on the receipt of the requisite approval of Citadel stockholders, the expiration or termination of the waiting period under the HSR Act, the receipt of the FCC Approval, the approval for listing on the Nasdaq Stock Market of the Cumulus Media common stock to be issued in the merger, the absence of any law or order prohibiting the merger or having certain material adverse effects on one or more of the parties to the merger, the correctness of all representations and warranties made by the parties in the merger agreement and performance by the parties of their obligations under the merger agreement (subject in each case to certain materiality standards).
 
There is no assurance that Citadel and Cumulus Media will receive the necessary stockholder or regulatory approvals or satisfy the other conditions to the completion of the merger. If the merger is not completed for any reason, Citadel will be subject to several risks, including the following:
 
  •  Citadel may be required to pay significant transaction costs related to the merger, including under certain circumstances, a termination fee of up to $80.0 million payable to Cumulus Media, and many of Citadel’s costs relating to the merger (such as legal, accounting, and a portion of Citadel’s financial advisory fees) are payable by Citadel whether or not the merger is completed;
 
  •  The current market price of Citadel’s common stock and warrants may reflect a market assumption that the merger will occur, and a failure to complete the merger could result in a negative perception by the market of Citadel generally and a resulting decline in the market price of Citadel common stock and warrants;
 
  •  There may be substantial disruption to Citadel’s business and a distraction of its management and employees from day-to-day operations, because matters related to the merger (including integration planning) may require substantial commitments of time and resources, which could otherwise have been devoted to other opportunities that could have been beneficial; and
 
  •  Citadel would continue to face the risks that it currently faces as an independent company, as further described herein.


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If the merger is not completed, the risks described above may materialize and materially adversely affect Citadel’s business, financial results, financial condition, and stock price.
 
The merger agreement limits Citadel’s ability to pursue alternatives to the merger and contains provisions that could affect the decisions of a third party considering making an alternative acquisition proposal to the merger.
 
The merger agreement prohibits Citadel from soliciting, initiating or encouraging alternative merger or acquisition proposals with any third party. These provisions may limit Citadel’s ability to pursue a proposal from a third party. Under the terms of the merger agreement, Citadel will be required to pay to Cumulus Media a termination fee of up to $80.0 million if the merger agreement is terminated under certain circumstances. This termination fee of $80.0 million would be payable in certain circumstances involving a material breach of certain material covenants or agreements that is a consequence of a knowing or intentional act or failure to act by Citadel or one of its executive officers with actual knowledge that such action or inaction would cause certain conditions necessary for consummation of the merger under the merger agreement to not be satisfied. In addition, the merger agreement limits the ability of Citadel to initiate, solicit, encourage or facilitate certain acquisition or merger proposals from a third party. These provisions could affect the decision by a third party to make a competing acquisition proposal, including the structure, pricing and terms proposed by a third party seeking to acquire or merge with Citadel. Please see “The Merger Agreement — No-Solicitation of Alternative Proposals” on page   .
 
There may be a long delay between the receipt of Citadel stockholder approval for the merger and the closing of the transaction, during which time Citadel will lose the ability to consider and pursue alternative acquisition proposals, which might otherwise be superior to the merger.
 
Following Citadel’s stockholders’ approval, the merger agreement prohibits Citadel from taking any actions to review, consider or recommend any alternative acquisition proposals, including those that could be superior to Citadel stockholders, when compared to the merger. Given the potentially long delay between stockholder approval and antitrust clearance and FCC Approval, the time during which Citadel could be prevented from reviewing, considering or recommending such proposals could be significant.
 
Citadel stockholders may not receive the form of merger consideration that they elect for all their shares and may receive in part a form of consideration that has lower value.
 
The merger agreement contains proration provisions that are designed to ensure that Cumulus Media does not (i) pay cash in excess of the Cash Consideration Cap or (ii) issue a number of shares in excess of the Stock Consideration Cap. The value of the stock consideration at the time of the merger may be higher than the value of the cash consideration at such time, or vice versa. If elections are made by Citadel stockholders to receive more cash or more shares of Cumulus Media common stock than these maximum numbers, either those electing to receive cash or those electing to receive shares of Cumulus Media common stock, respectively, will have the consideration of the type they selected reduced by a pro rata amount, and will receive a portion of their consideration in the form that they did not elect to receive. Accordingly, it is likely that a substantial number of Citadel stockholders will not receive a portion of the merger consideration in the form that they elect and that the consideration they do receive will have a lower value than what they elected to receive.
 
Because the exchange ratio is fixed, the market value of Cumulus Media common stock issued to you may be less than the value of your shares of Citadel common stock.
 
Citadel stockholders who receive shares in the merger will receive a fixed number of shares of Cumulus Media common stock rather than a number of shares with a particular fixed market value. The market values of Cumulus Media common stock and Citadel common stock at the time of the merger may vary significantly from their respective values on the date the merger agreement was executed, the date of this information statement/proxy statement/prospectus or the date on which Citadel stockholders vote on the merger agreement. Because the exchange ratio will not be adjusted to reflect any changes in the market value of Cumulus Media


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or Citadel common stock, the market value of Cumulus Media common stock issued in the merger and Citadel common stock surrendered in the merger may be higher or lower than the values of such shares on such earlier dates, and may be higher or lower than the $37.00 to be paid to Citadel stockholders in the cash portion of the merger. Stock price changes may result from a variety of factors, including changes in businesses and operations, and other factors that are beyond the control of Cumulus Media and Citadel, including changes in business prospects, regulatory considerations and general and industry specific market and economic conditions. Neither Cumulus Media nor Citadel is permitted to terminate the merger agreement solely because of changes in the market price of either party’s common stock.
 
Officers and directors of Citadel have certain interests in the merger that are different from, or in addition to, interests of Citadel stockholders. These interests may be perceived to have affected their decision to support or approve the merger.
 
Citadel’s executive officers and directors have economic interests in the merger that are different from, or in addition to, those of Citadel’s stockholders generally. These interests include, but are not limited to: the treatment of equity awards held by executive officers and directors (including the acceleration of vesting of stock options and the treatment of restricted stock); the payment of pro-rated annual bonuses to executive officers at the target level of achievement for the year in which the merger is consummated; the potential acceleration of supplemental retirement benefits for Mr. Suleman; the potential payment of severance and other benefits to executive officers; and the potential payment of tax gross-ups to certain executive officers. Citadel’s board of directors was aware of and considered those interests, among other matters, in reaching its decisions to adopt and approve the merger agreement, the merger and the transactions contemplated by the merger agreement. Please see “The Merger — Interests of Certain Persons in the Merger” on page      .
 
Cumulus Media is required to obtain various Federal regulatory approvals for the merger, including approval of the FCC, the DOJ and the FTC, which approval and termination or expiration of waiting periods may be subject to Cumulus Media’s compliance with certain conditions.
 
Completion of the merger requires prior approval of the FCC, the DOJ and the FTC and may require approvals by other governmental agencies as well. As part of the FCC approval process, Cumulus Media and Citadel have filed the FCC Applications. The Communications Act and FCC rules allow members of the public and other interested parties to file petitions to deny or other objections with the FCC with respect to the grant of the FCC Applications. As of the deadline for filing petitions to deny the FCC Applications, two minor comments were filed by third parties. The FCC could rely on any petitions or other objections that have been filed, or its own initiative, to deny an FCC Application, to require changes in the transaction documents relating to those FCC Applications, including divestiture of radio stations and other assets, or impose other conditions to the grant of any of the FCC Applications. For these and other reasons, there can be no assurance that the FCC will grant the FCC Approval. Any changes necessary to obtain the FCC Approval may have a material adverse effect on Cumulus Media’s business, financial condition and results of operations before or after the merger. In addition, completion of the merger requires that the parties file a notification and report form with the FTC and DOJ, and observe specified waiting period requirements before consummating the acquisition. Cumulus Media and Citadel intend to file such required notifications with the Antitrust Division of the DOJ and the FTC. The waiting period under the HSR Act is expected to expire on          , unless each party receives notice of termination of the waiting period before that date or unless the reviewing agency extends the period by issuing a Second Request. The termination of the waiting period upon the issuance of a Second Request may be subject to compliance with certain conditions.
 
The merger may be completed on different terms from those contained in the merger agreement.
 
Prior to the completion of the merger, the parties may amend or alter the terms of the merger agreement, including with respect to, among other things, the merger consideration to be received by Citadel stockholders; assets to be acquired; or any covenants or agreements with respect to the parties’ respective operations during the pendency thereof (certain of these changes, including those with respect to the merger consideration to be received by Citadel stockholders, can only be made prior to the requisite stockholder approval). Any such amendments or alterations may have negative consequences to stockholders of Cumulus Media and/or Citadel including, among other things, reducing the cash available for operations or to meet respective obligations or


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restricting or limiting assets or operations of either of Cumulus Media or Citadel, any of which could also have a material adverse effect on such company’s business, financial condition and results of operations.
 
Cumulus Media may be required to issue preferred stock in connection with the Equity Investment with terms that could negatively impact its liquidity.
 
Pursuant to the terms of the Investment Agreement, Macquarie may, at its option, subscribe to purchase up to $125.0 million in initial liquidation value of shares of a newly created series of perpetual redeemable non-convertible preferred stock instead of shares of Cumulus Media common stock. The preferred stock would be transferable, other than to specified competitors of Cumulus Media. Third parties to whom Macquarie syndicates its commitment may not purchase any such preferred stock. Dividends on this preferred stock would accrue at a rate of 10% per annum for the first six months after the closing of the Equity Investment, 14% per annum thereafter until the second anniversary of the closing of the Equity Investment, 17% per annum plus the positive change in LIBOR from the closing of the Equity Investment to each even-numbered anniversary thereof (the “LIBOR Increase Amount”) per annum thereafter until the fourth anniversary of the closing of the Equity Investment, and 20% plus the LIBOR Increase Amount per annum thereafter. If Macquarie elects to purchase Cumulus Media preferred stock instead of Cumulus Media common stock, the requirement that Cumulus Media pay dividends, either in cash or through the issuance of additional shares of preferred stock, could materially impact Cumulus Media’s liquidity position and may require Cumulus Media to dedicate a significant portion of its cash flows to servicing dividend requirements. This would reduce the amount of cash flow available for working capital, capital expenditures and servicing Cumulus Media’s indebtedness.
 
The unaudited pro forma financial information in this information statement/proxy statement/prospectus may not be reflective of Cumulus Media’s operating results and financial condition following the merger.
 
The unaudited pro forma financial information included in this information statement/proxy statement/prospectus is derived from Cumulus Media’s, CMP’s and Citadel’s separate historical consolidated financial statements. The preparation of this pro forma information is based upon available information and certain assumptions and estimates that Cumulus Media currently believes are reasonable, including certain assumptions with respect to Cumulus Media’s stock price and interest rates at the closing of the merger, the amount of cash and Cumulus Media common stock Citadel stockholders will elect to receive in the merger, whether and to what extent Macquarie elects to invest in warrants exercisable for Class B common stock, or a newly created class of perpetual redeemable non-convertible preferred stock, the number of warrants to purchase Class B common stock issued to UBS Securities and the assumption that the radio stations Cumulus Media expects to be required to divest in order to obtain FCC Approval and the remedies, if any, that may be required by the HSR Act will not be material to Cumulus Media’s financial position or results of operations. These assumptions and estimates may not prove to be accurate, and this pro forma financial information may not necessarily reflect what Cumulus Media’s results of operations and financial position would have been had the merger and related transactions been completed if these assumptions were accurate, or occurred during the periods presented, or what Cumulus Media’s results of operations and financial position will be in the future.
 
If the merger is completed, the loss of affiliation agreements by Citadel’s Radio Network could materially adversely affect Cumulus Media’s actual results of operations as presented on a Citadel Pro Forma Basis or an Overall Pro Forma Basis.
 
Upon consummation of the merger, Cumulus Media will own Citadel’s Radio Network, which has approximately 4,000 station affiliates and 9,000 program affiliations. The Radio Network receives advertising inventory from its affiliated stations, either in the form of standalone advertising time within a specified time period or commercials inserted by the Radio Network into its programming. In addition, primarily with respect to satellite radio providers, Citadel receives a fee for providing such programming. The loss of network affiliation agreements of the Radio Network could adversely affect Cumulus Media’s actual financial condition and results of operations as compared to those presented on a Citadel Pro Forma basis and an Overall Pro Forma Basis by reducing the reach of Citadel’s network programming and, therefore, its attractiveness to advertisers. Renewal on less favorable terms may also adversely affect Cumulus Media’s actual results of operations as compared to those presented on a Citadel Pro Forma Basis and an Overall Pro Forma Basis (each as defined herein) through reduction of advertising revenue.


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Closing of the merger may trigger change in control provisions in certain agreements to which Cumulus Media or Citadel are parties.
 
The closing of the merger may trigger change in control provisions in certain agreements to which Cumulus Media or Citadel are parties. If Cumulus Media or Citadel are unable to negotiate waivers of those provisions, the counterparties may exercise their rights and remedies under the agreements (including terminating the agreements or seeking monetary damages). Even if Cumulus Media or Citadel were able to negotiate waivers, the counterparties may require a fee for such waiver or seek to renegotiate the agreements on materially less favorable terms prior to such change in control.
 
Former Citadel stockholders who become stockholders of Cumulus Media will be governed by the Third Amendment and Restatement and Cumulus Media Bylaws.
 
Citadel stockholders who receive Cumulus Media common stock in the merger will become Cumulus Media stockholders and their rights as stockholders will be governed by the Third Amendment and Restatement, Cumulus Media Bylaws and the DGCL. As a result, there will be material differences between the current rights of Citadel stockholders and the rights they can expect to have as Cumulus Media stockholders. Please see “Comparison of Rights of Holders of Cumulus Media Common Stock and Citadel Common Stock” on page   .
 
Purported stockholder class action complaints have been filed against Citadel, Cumulus Media and the members of Citadel’s board of directors, as well as against Merger Sub and Holdco, challenging the merger, and an unfavorable judgment or ruling in these lawsuits could prevent or delay the consummation of the merger and result in substantial costs.
 
On March 14, 2011, Citadel, its board of directors and Cumulus Media were named in a putative stockholder class action complaint filed in the District Court of Clark County, Nevada, by a purported Citadel stockholder. On March 23, 2011, these same defendants, as well as Holdco and Merger Sub, were named in a second putative stockholder class action complaint filed in the same court by another purported Citadel stockholder. The complaints allege that Citadel’s directors breached their fiduciary duties by approving the merger for allegedly inadequate consideration and following an allegedly unfair sale process. The complaint in the first action also alleges that Citadel’s directors breached their fiduciary duties by allegedly withholding material information relating to the merger. The two complaints further allege that Citadel and Cumulus Media aided and abetted the Citadel directors’ alleged breaches of fiduciary duties, and the complaint filed in the second action alleges, additionally, that Holdco and Merger Sub aided and abetted these alleged breaches of fiduciary duties. The complaints seek, among other things, a declaration that the action can proceed as a class action, an order enjoining the completion of the merger, rescission of the merger, attorneys’ fees, and such other relief as the court deems just and proper. The complaint filed in the second action also seeks rescissory damages. On June 23, 2011, the court consolidated the two Nevada actions and appointed lead counsel. On May 6, 2011, two purported common stockholders of Citadel filed a putative class action complaint against Citadel, its board of directors, Cumulus Media, Holdco, and Merger Sub in the Court of Chancery of the State of Delaware. The complaint alleges that Citadel’s directors breached their fiduciary duties to Citadel’s stockholders by approving the merger for allegedly inadequate consideration and following an allegedly unfair sale process and that the remaining defendants aided and abetted these alleged breaches. The complaint seeks, among other things, an order enjoining the merger, a declaration that the action is properly maintainable as a class action, and rescission of the merger agreement, as well as attorneys’ fees and costs. Citadel and Cumulus Media intend to vigorously defend against these actions.
 
Each of Cumulus Media and Citadel is obliged under certain circumstances to indemnify and hold harmless each of its respective directors and officers from and against any and all claims and liabilities to which such director or officer shall have become subject by reason of being a director or officer of such company, to the full extent permitted under Delaware law. An adverse outcome in any lawsuit could prevent or delay the consummation of the merger and result in substantial costs to Citadel and/or Cumulus Media. It is also possible that other similar lawsuits may be filed in the future. Neither Cumulus Media nor Citadel can reasonably estimate any possible loss from current or future litigation.


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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
 
This information statement/proxy statement/prospectus contains and incorporates by reference “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. For purposes of federal and state securities laws, forward-looking statements are all statements other than those of historical fact and are typically identified by the words “believes,” “expects,” “anticipates,” “continues,” “intends,” “likely,” “may,” “plans,” “potential,” “should,” “will,” and similar expressions, whether in the negative or the affirmative. These statements include statements regarding the intent, belief or current expectations of each of Cumulus Media and Citadel and their respective subsidiaries, their directors and their officers with respect to, among other things, future events, including the merger and the transactions contemplated by the merger agreement, their respective financial results and financial trends expected to impact each of Cumulus Media and Citadel.
 
Forward-looking statements may be subject to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements reflect the views of each of Cumulus Media and Citadel with respect to current events and financial performance as of the date they were made. Such forward-looking statements are and will be, as the case may be, subject to change and subject to many risks, uncertainties and factors relating to Cumulus Media’s and Citadel’s respective operations and business environment, which may cause the actual results of Cumulus Media and/or Citadel to be materially different from any future results, expressed or implied, by such forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following:
 
  •  the financial performance of Cumulus Media and Citadel through the date of the completion of the merger;
 
  •  the inability to satisfy any of the closing conditions set forth in the merger agreement, including the possibility that Cumulus Media and/or Citadel may be unable to obtain stockholder or regulatory approvals required for the merger, or that any regulatory approval is conditioned on factors that could materially adversely affect the expected benefits to be derived from the merger;
 
  •  the occurrence of an event, change or other circumstance that could give rise to termination of the merger agreement, including a termination under circumstances that could require payment of a termination fee;
 
  •  the failure to obtain the necessary debt financing set forth in the commitment letters received in connection with the merger;
 
  •  the failure to obtain the necessary equity financing set forth in the Investment Agreement entered into in connection with the merger;
 
  •  the failure of the merger to close for any reason;
 
  •  the amount of the actual costs, fees, expenses and charges related to the merger and the final terms of the financings that will be obtained for the merger;
 
  •  the possibility that the merger may involve unexpected costs;
 
  •  diversion of the attention of management of each of Cumulus Media and Citadel from their respective ongoing business concerns;
 
  •  the effect of the announcement of the merger on customer relationships, operating results and the businesses of the companies generally;
 
  •  any significant delay in the expected completion of the merger;
 
  •  the possibility that problems may arise in successfully integrating the businesses of Cumulus Media and Citadel;
 
  •  the possibility that the combined company may be unable to achieve cost-cutting synergies or achieve them within the expected time period;


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  •  the possibility that the combined company may be unable to achieve certain expected revenue results, including as a result of unexpected factors or events;
 
  •  the possibility that the respective businesses of Cumulus Media and/or Citadel may suffer as a result of uncertainty surrounding the merger;
 
  •  the possibility that the industry may be subject to future regulatory or legislative actions;
 
  •  the ability to maintain contracts and leases that are critical to Cumulus Media’s and/or Citadel’s operations;
 
  •  the ability to attract, motivate and/or retain key executives and associates;
 
  •  the ability to execute Cumulus Media’s and/or Citadel’s business plans and strategy;
 
  •  general economic or business conditions affecting the radio broadcasting industry being less favorable than expected, including the impact of decreased spending by advertisers;
 
  •  increased competition in the radio broadcasting industry;
 
  •  the ability to renew FCC Authorizations and comply with the Communications Act and FCC rules and policies;
 
  •  the impact of current or pending legislation and regulations, antitrust considerations, and pending or future litigation or claims;
 
  •  the outcome of any legal proceedings that have been or may be instituted against Cumulus Media and/or Citadel relating to the merger agreement;
 
  •  general economic and business conditions that may affect Cumulus Media and/or Citadel before or the combined company following the merger;
 
  •  the impact of Citadel’s chapter 11 proceedings that may affect Citadel before, or the combined company following, the merger;
 
  •  changes in government regulations;
 
  •  changes in policies or actions or in regulatory bodies;
 
  •  changes in uncertain tax positions and tax rates;
 
  •  changes in the financial markets;
 
  •  changes in capital expenditure requirements;
 
  •  changes in market conditions that could impair Cumulus Media’s or Citadel’s goodwill or intangible assets;
 
  •  changes in interest rates; and
 
  •  other risks and uncertainties.
 
Cumulus Media and Citadel caution you not to place undue reliance on the forward-looking statements, which speak only as of the date of this information statement/proxy statement/prospectus in the case of forward-looking statements contained in this information statement/proxy statement/prospectus, or the dates of the documents incorporated by reference in this information statement/proxy statement/prospectus in the case of forward-looking statements made in those incorporated documents. Except as may be required by law, neither Cumulus Media nor Citadel has any obligation to update or alter these forward-looking statements, whether as a result of new information, future events or otherwise.
 
Cumulus Media and Citadel expressly qualify in their entirety all forward-looking statements attributable to Cumulus Media or Citadel or any person acting on either of their respective behalf by the cautionary statements contained or referred to in this section.


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INFORMATION ABOUT CUMULUS MEDIA
 
Cumulus Media Inc.
 
Cumulus Media owns and manages FM and AM radio station clusters serving mid-sized markets throughout the United States. Through its investment in CMP, Cumulus Media also manages radio station clusters serving large-sized markets throughout the United States. Cumulus Media is currently the second largest radio broadcasting company in the United States based on the number of stations owned or managed. As of March 31, 2011, Cumulus Media owned or managed 312 radio stations (including under local marketing agreements (“LMAs”)) in 60 United States media markets and operated the 34 radio stations in eight markets, including San Francisco, Dallas, Houston and Atlanta, that are owned by CMP. Under LMAs, Cumulus Media currently provides sales and marketing services for 12 radio stations in the United States in exchange for a management or consulting fee. In addition to entering into LMAs, Cumulus Media has in the past, and expects that it will from time to time in the future enter into management or consulting agreements that provide it with the ability, as contractually specified, to assist current owners in the management of radio station assets that Cumulus Media has contracted to purchase, subject to FCC approval. In such arrangements, Cumulus Media generally receives a contractually specified management fee or consulting fee in exchange for the services provided. In summary, Cumulus Media owns and manages directly or through its investment in CMP, a total of 346 stations in 68 United States markets as of March 31, 2011.
 
For the three months ended March 31, 2011 and the year ended December 31, 2010, Cumulus Media had net revenues of $57.9 million and $263.3 million, Station Operating Income of $20.3 million and $103.5 million, and Adjusted EBITDA of $12.8 million and $87.5 million, respectively.
 
Cumulus Media is a Delaware corporation, organized in 2002, and successor by merger to an Illinois corporation with the same name that had been organized in 1997.
 
Pending Transactions
 
Cumulus Media’s recently announced pending transactions in connection with the proposed expansion of its broadcasting operations include:
 
  •  the merger and the related assumption of outstanding debt, which will be refinanced as part of the Global Refinancing (defined herein);
 
  •  the CMP Acquisition (defined herein), pursuant to which Cumulus Media agreed to acquire the remaining 75% of the equity interests of CMP that it does not currently own in exchange for the issuance of shares of Cumulus Media common stock;
 
  •  the Equity Investment; and
 
  •  the financing transaction necessary to complete the merger, which is referred to herein as the “Global Refinancing,” pursuant to which Cumulus Media intends to refinance an aggregate of $1.4 billion (as of March 31, 2011) in outstanding senior and subordinated indebtedness of each of (i) Cumulus Media (other than Cumulus Media’s recently issued $610.0 million of 7.75% senior notes due 2019 (the “2019 Notes”)), (ii) CMP Susquehanna Corporation, an indirectly wholly-owned subsidiary of CMP (“CMPSC”), and (iii) Citadel, as well as preferred stock of Radio Holdings (defined herein), all pursuant to a debt commitment letter (the “Debt Commitment”) that provides for up to $2.415 billion in senior secured financing pursuant to the Acquisition Credit Facility (defined herein).
 
CMP Acquisition
 
On January 31, 2011, Cumulus Media entered into an Exchange Agreement (the “Exchange Agreement”) with affiliates of Bain Capital Partners LLC (“Bain”), Blackstone and Thomas H. Lee Partners (“THL” and, together with Bain and Blackstone, the “CMP Sellers”). Pursuant to the Exchange Agreement, Cumulus Media agreed to (i) acquire all of the outstanding equity interests of CMP that it currently does not own in exchange for 3,315,238 shares of Cumulus Media Class A common stock and 6,630,476 shares of Cumulus Media


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Class D common stock (the “CMP Acquisition”) and (ii) enter into an agreement with holders of currently outstanding warrants (the “Radio Holdings Warrants”) to purchase 3,740,893 shares of common stock of CMP Susquehanna Radio Holdings Corp., an indirect wholly-owned subsidiary of CMP (“Radio Holdings”), which agreement would amend the Radio Holdings Warrants to provide that, upon the closing of the CMP Acquisition, in lieu of being exercisable for shares of common stock of Radio Holdings, the Radio Holdings Warrants would instead be exercisable for an aggregate of 8,267,968 shares of Cumulus Media Class D common stock. As a result of the transactions contemplated by the Exchange Agreement, CMP will become Cumulus Media’s wholly-owned subsidiary, and holders of the Radio Holdings Warrants will be entitled to acquire shares of Cumulus Media common stock rather than shares of stock of Cumulus Media’s subsidiary.
 
For the three months ended March 31, 2011 and the year ended December 31, 2010, CMP had net revenues of $39.1 million and $188.7 million, respectively.
 
The Global Refinancing
 
In connection with the merger agreement and the Investment Agreement, Cumulus Media obtained the Debt Commitment from a group of banks affiliated with certain of the initial purchasers of the 2019 Notes (the “2019 Notes Offering”), pursuant to which they have committed to provide financing for Cumulus Media to complete the merger and the Global Refinancing. In accordance with the Debt Commitment, Cumulus Media expects to enter into a credit facility with a syndicate of lenders, agents and arrangers, including JPMorgan Chase Bank, N.A., UBS Loan Finance LLC, MIHI LLC (an affiliate of Macquarie), Royal Bank of Canada and ING Capital LLC (“ING Capital”) as lenders and agents, and J.P. Morgan, UBS Securities, Macquarie, RBC Capital Markets, LLC and ING Capital as joint lead arrangers and joint book-runners, and ING Capital as co-syndication agent (the “Acquisition Credit Facility”).
 
Cumulus Media currently expects that the Acquisition Credit Facility will provide senior secured financing of $2.415 billion, consisting of:
 
  •  a $2.040 billion term loan facility, with a maturity date that is seven years from the closing of the merger; and
 
  •  a $375.0 million revolving credit facility, with a maturity date that is five years from the closing of the merger.
 
Cumulus Media’s expected borrowings under each of the term loan facility and the revolving credit facility at the closing of the merger will depend upon the aggregate amount of cash the Citadel stockholders elect to receive pursuant to the merger agreement, whether the CMP Acquisition is closed prior to the closing of the merger, the amount of cash on hand at Cumulus Media, CMP and Citadel at the closing of the merger, and any debt reduction occurring prior thereto from cash from operations, all of which will depend on the timing of such closing.
 
The Debt Commitment also included commitments from the lenders for $500.0 million in senior unsecured bridge financing (the “Acquisition Bridge Facility”). As a result of the 2019 Notes Offering, Cumulus Media has eliminated the need to borrow under the Acquisition Bridge Facility, and the lenders’ commitments thereunder have been accordingly reduced to zero. The Debt Commitment continues to provide the lenders with the right, under certain circumstances, to reallocate a portion of the amount expected to be borrowed as part of the term loan under the Acquisition Credit Facility to the Acquisition Bridge Facility.
 
Cumulus Media currently anticipates that, in connection with the consummation of the merger and the Global Refinancing, and as a result of its use of the proceeds of the 2019 Notes Offering to repay the $575.8 million outstanding as of March 31, 2011, under the term loan facility of Cumulus Media’s existing credit agreement (the “Existing Credit Agreement”) and, assuming that Cumulus Media completes the CMP Acquisition as planned prior to completing the merger, Cumulus Media will utilize proceeds from the Equity Investment and the Global Refinancing as follows:
 
  •  between approximately $1.153 billion and $1.504 billion to fund the cash portion of the purchase price in the merger (depending on exercise of cash or stock elections under the merger agreement);


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  •  approximately $659.9 million (based on amounts outstanding at March 31, 2011) to repay all amounts outstanding under the credit facilities of CMPSC (the “CMPSC Credit Agreement”), the 9.875% Senior Subordinated Notes due 2014 of CMPSC (the “CMP 9.875% Notes”) and the Variable Rate Senior Secured Notes due 2014 of CMPSC (the “CMP 2014 Notes”), and to redeem in accordance with their terms all outstanding shares of preferred stock of Radio Holdings, with an aggregate redemption value of approximately $38.9 million (collectively, the “CMP Refinancing”);
 
  •  approximately $787.2 million (based on amounts outstanding at March 31, 2011) to repay all amounts outstanding, including any accrued interest and the premiums thereon, under Citadel’s existing credit agreement (the “Citadel Credit Facilities”) and its senior notes due 2018 (the “Citadel Senior Notes”); and
 
  •  approximately $146.7 million to pay estimated fees and expenses related to the merger, the Equity Investment and the Acquisition Credit Facility.
 
The actual timing of each of these proposed and pending transactions will depend upon a number of factors, including the various conditions set forth in the respective transaction agreements. There can be no assurance that any of such pending or proposed transactions will be consummated or that, if any of such transactions is consummated, the timing or terms thereof will be as described herein and as presently contemplated.


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INFORMATION ABOUT CITADEL
 
Citadel Broadcasting Corporation, headquartered in Las Vegas, Nevada, is the third largest radio broadcasting company in the United States based on net radio revenue as of March 31, 2011, behind Clear Channel Communications, Inc. and CBS Corporation. Citadel operates in two reportable segments. Radio stations serving the same geographic area (i.e., principally a city or combination of cities) that are owned and/or operated by Citadel are referred to as a market, and Citadel aggregates the geographic markets in which it operates into one reportable segment. Citadel’s primary business segment is the Radio Markets segment, which, as of March 31, 2011, consisted of 225 owned and operated radio stations located in over 50 markets across the United States. Citadel also owns and operates Radio Network, one of the largest radio networks in the country, which produces and distributes a variety of radio programming and formats that are syndicated across approximately 4,000 station affiliates and 9,000 program affiliations, and is a separate reportable segment.


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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA
 
The following tables present selected historical consolidated financial data for Cumulus Media as of and for the three months ended March 31, 2011 and 2010 and the fiscal years ended December 31, 2010, 2009, 2008, 2007 and 2006. The information should be read in conjunction with Cumulus Media’s consolidated financial statements and the related notes thereto and the information under the heading “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” set forth in its quarterly report on Form 10-Q for the quarterly period ended March 31, 2011 and its annual report on Form 10-K for the fiscal year ended December 31, 2010, each of which is incorporated by reference into this document. The information as of and for the fiscal years ended December 31, 2007 and 2006 should be read in conjunction with Cumulus Media’s consolidated financial statements and related notes thereto, each of which is not incorporated by reference into this document.
 
The following tables also present selected historical consolidated financial data for Citadel as of and for the three months ended March 31, 2011 and 2010, as of and for the fiscal years ended December 31, 2009, 2008, 2007 and 2006, as of December 31, 2010, and for the periods from January 1, 2010 through May 31, 2010 and from June 1, 2010 through December 31, 2010. This information should be read in conjunction with Citadel’s consolidated financial statements and the related notes thereto and the information under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” set forth in Citadel’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2011 and Citadel’s annual report on Form 10-K for the fiscal year ended December 31, 2010, each of which is incorporated by reference in this document. The information as of and for the fiscal years ended December 31, 2007 and 2006 should be read in conjunction with Citadel’s consolidated financial statements and related notes thereto, each of which is not incorporated by reference into this document.
 
As a result of Citadel’s emergence from Chapter 11 proceedings and its adoption of fresh-start accounting, Citadel’s selected historical consolidated financial information for periods prior to May 31, 2010 (the “Fresh-Start Date”) and shown in the “Predecessor” columns below, will not be comparable to financial information for periods following Citadel’s emergence from Chapter 11 proceedings shown in the “Successor” columns below. In addition, Citadel’s results of operations for the period from January 1, 2010 through May 31, 2010 and the period from June 1, 2010 through December 31, 2010 are not necessarily indicative of its operating results to be expected for a full fiscal year.


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Cumulus Media:
 
                                                         
    Three Months Ended
       
    March 31,     Year Ended December 31,  
    2011     2010     2010     2009     2008     2007     2006(4)  
    (Unaudited)                                
    (Dollars in thousands, except per share data)  
 
Statement of Operations Data:
                                                       
Net revenues
  $ 57,858     $ 56,358     $ 263,333     $ 256,048     $ 311,538     $ 328,327     $ 334,321  
Station operating expenses (excluding depreciation, amortization and LMA fees)
    37,555       39,926       159,807       165,676       203,222       210,640       214,089  
Depreciation and amortization
    2,123       2,517       9,098       11,136       12,512       14,567       17,420  
LMA fees
    581       529       2,054       2,332       631       755       963  
Corporate general and administrative (including non-cash stock compensation expense)
    8,129       4,066       18,519       20,699       19,325       26,057       41,012  
Gain on exchange of assets or stations
    (15,158 )                 (7,204 )           (5,862 )     (2,548 )
Realized loss on derivative instrument
    40       584       1,957       3,640                    
Impairment of intangible assets and goodwill(1)
                671       174,950       498,897       230,609       63,424  
Other operating expense
                            2,041       2,639        
                                                         
Operating income (loss)
    24,588       8,736       71,227       (115,181 )     (425,090 )     (151,078 )     (39 )
Interest expense, net
    (6,318 )     (8,829 )     (30,307 )     (33,989 )     (47,262 )     (60,425 )     (42,360 )
Terminated transaction (expense) income
                (7,847 )           15,000              
Losses on early extinguishment of debt
                                  (986 )     (2,284 )
Other (expense) income, net
    (2 )     (53 )     108       (136 )     (10 )     117       (98 )
Income tax (expense) benefit
    (2,149 )     2       (3,779 )     22,604       117,945       38,000       5,800  
Equity losses in affiliate
                            (22,252 )     (49,432 )     (5,200 )
                                                         
Net income (loss)
  $ 16,119     $ (144 )   $ 29,402     $ (126,702 )   $ (361,669 )   $ (223,804 )   $ (44,181 )
                                                         
Basic income (loss) per common share
  $ 0.38     $ (0.01 )   $ 0.70     $ (3.13 )   $ (8.55 )   $ (5.18 )   $ (0.87 )
Diluted income (loss) per common share
  $ 0.37     $ (0.01 )   $ 0.69     $ (3.13 )   $ (8.55 )   $ (5.18 )   $ (0.87 )
Other Data:
                                                       
Station Operating Income(2)
  $ 20,303     $ 16,432     $ 103,526     $ 90,372     $ 108,316     $ 117,687     $ 120,232  
Station Operating Income margin(3)
    35.1 %     29.2 %     39.3 %     35.3 %     34.8 %     35.8 %     36.0 %
Cash flows related to:
                                                       
Operating activities
  $ 10,026     $ 12,095     $ 42,738     $ 28,691     $ 76,654     $ 46,057     $ 65,322  
Investing activities
    (1,786 )     (451 )     (2,425 )     (3,060 )     (6,754 )     (29 )     (19,217 )
Financing activities
    (18,619 )     (12,918 )     (43,723 )     (62,410 )     (49,183 )     (16,134 )     (48,834 )
Capital expenditures
    (502 )     (431 )     (2,353 )     (3,110 )     (6,069 )     (4,789 )     (9,211 )
 
                                                 
    March 31,     December 31,  
    2011     2010     2009     2008     2007     2006(4)  
    (Unaudited)                                
    (Dollars in thousands, except per share data)  
 
Balance Sheet Data:
                                               
Total assets
  $ 318,876     $ 319,636     $ 334,064     $ 543,519     $ 1,060,542     $ 1,333,147  
Long-term debt (including current portion)
    573,269       591,008       633,508       696,000       736,300       731,250  
Total stockholders’ (deficit) equity
  $ (324,403 )   $ (341,309 )   $ (372,512 )   $ (248,147 )   $ 119,278     $ 337,007  


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(1) Impairment charge recorded in connection with Cumulus Media’s interim and annual impairment testing under Accounting Standards Codification (“ASC”) 350. See Note 4, “Intangible Assets and Goodwill,” in the notes to Cumulus Media’s audited consolidated financial statements incorporated by reference in this information statement/proxy statement/prospectus for further discussion.
 
(2) Station Operating Income consists of operating income before depreciation and amortization, LMA fees, non-cash stock compensation, other corporate general and administrative expenses excluding non-cash stock compensation expense, any gain on exchange of assets or stations, any realized loss on derivative instrument, impairment of intangible assets and goodwill, costs associated with Cumulus Media’s terminated attempt to purchase radio station WTKE-FM in Holt, Florida (in 2008 and 2007). Station Operating Income should not be considered in isolation or as a substitute for net (loss) income, operating (loss) income, cash flows from operating activities or any other measure for determining Cumulus Media’s operating performance or liquidity that is calculated in accordance with accounting principles generally accepted in the United States (“GAAP”). Cumulus Media excludes depreciation and amortization due to the insignificant investment in tangible assets required to operate its stations and the relatively insignificant amount of intangible assets subject to amortization. Cumulus Media excludes LMA fees from this measure, even though they require a cash commitment, due to the insignificance and temporary nature of such fees. Corporate expenses, despite representing an additional significant cash commitment, are excluded in an effort to present the operating performance of Cumulus Media’s stations exclusive of the corporate resources employed. Cumulus Media excludes terminated transaction costs due to the temporary nature of such costs. Finally, Cumulus Media excludes non-cash stock compensation, any gain or loss on exchange of assets or stations, any realized gain or loss on derivative instrument, and impairment of intangible assets and goodwill from the measure as they do not represent cash payments for activities related to the operation of the stations. Cumulus Media believes that this is important to investors because it highlights the gross margin generated by Cumulus Media’s station portfolio.
 
Cumulus Media believes that Station Operating Income is the most frequently used financial measure in determining the market value of a radio station or group of stations and to compare the performance of radio station operators. Cumulus Media has observed that Station Operating Income is commonly employed by firms that provide appraisal services to the broadcasting industry in valuing radio stations. Further, in connection with Cumulus Media’s historical acquisitions, it has used Station Operating Income as its primary metric to evaluate and negotiate the purchase price to be paid. Given its relevance to the estimated value of a radio station, Cumulus Media believes, and its experience indicates, that investors consider the measure to be extremely useful in order to determine the value of Cumulus Media’s portfolio of stations. Additionally, Station Operating Income is one of the measures that Cumulus Media’s management uses to evaluate the performance and results of its stations. Cumulus Media’s management uses the measure to assess the performance of its station managers and Cumulus Media’s board of directors uses it to determine the relative performance of Cumulus Media’s executive management. As a result, in disclosing Station Operating Income, Cumulus Media is providing investors with an analysis of its performance that is consistent with that which is utilized by Cumulus Media’s management and Cumulus Media’s board of directors.
 
Station Operating Income is not a recognized term under GAAP and does not purport to be an alternative to operating income from continuing operations as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Additionally, Station Operating Income is not intended to be a measure of free cash flow available for dividends, reinvestment in Cumulus Media’s business or other Cumulus Media discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements. Station Operating Income should be viewed as a supplement to, and not a substitute for, results of operations presented on the basis of GAAP. Cumulus Media compensates for the limitations of using Station Operating Income by using it only to supplement its GAAP results to provide a more complete understanding of the factors and trends affecting Cumulus Media’s business than GAAP results alone. Station Operating Income has its limitations as an analytical tool, and investors should not consider it in isolation or as a substitute for analysis of Cumulus Media’s results as reported under GAAP. Moreover, because not all companies use identical calculations, these


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presentations of Station Operating Income may not be comparable to other similarly titled measures of other companies.
 
A reconciliation of Station Operating Income to operating income (loss), net (the most closely comparable measure prepared in accordance with GAAP) is presented below.
 
                                                         
    Three Months Ended
       
    March 31,     Year Ended December 31,  
    2011     2010     2010     2009     2008     2007     2006(4)  
    (Unaudited)                                
    (Dollars in thousands)  
 
Operating income (loss)
  $ 24,588     $ 8,736     $ 71,227     $ (115,181 )   $ (425,090 )   $ (151,078 )   $ (39 )
Depreciation and amortization
    2,123       2,517       9,098       11,136       12,512       14,567       17,420  
LMA fees
    581       529       2,054       2,332       631       755       963  
Non-cash stock compensation
    589       (101 )     2,451       2,879       4,663       9,212       24,447  
Corporate general and administrative
    7,540       4,167       16,068       17,820       14,662       16,845       16,565  
Gain on exchange of assets or stations
    (15,158 )                 (7,204 )           (5,862 )     (2,548 )
Realized loss on derivative instrument
    40       584       1,957       3,640                    
Impairment of intangible assets and goodwill
                671       174,950       498,897       230,609       63,424  
Other operating expense
                            2,041       2,639        
                                                         
Station Operating Income
  $ 20,303     $ 16,432     $ 103,526     $ 90,372     $ 108,316     $ 117,687     $ 120,232  
                                                         
 
(3) Station Operating Income margin is defined as Station Operating Income as a percentage of net revenues.
 
(4) Cumulus Media recorded certain immaterial adjustments to the 2006 consolidated financial data.
 
Citadel:
 
                                                                 
    Successor     Predecessor     Successor     Predecessor  
                Period
    Period
                         
                from
    from
                         
    Three
    Three
    June 1,
    January 1,
                         
    Months
    Months
    2010
    2010
                         
    Ended
    Ended
    through
    through
                         
    March 31,
    March 31,
    December 31,
    May 31,
    Years Ended December 31,  
    2011     2010     2010     2010     2009     2008     2007     2006  
    (Unaudited)                                      
    (Dollars in thousands, except per share amounts)  
 
Operating data:(1)
                                                               
Net revenue
  $ 160,022     $ 165,028     $ 444,142     $ 295,424     $ 723,620     $ 863,121     $ 719,757     $ 432,930  
Operating expenses:
                                                               
Cost of revenue, exclusive of depreciation and amortization shown separately below
    68,522       68,978       164,594       116,103       306,648       353,014       254,727       120,270  
Selling, general and administrative
    46,192       46,631       113,637       78,582       203,871       227,517       195,611       126,558  
Corporate general and administrative expenses
    14,452       5,160       26,394       8,929       26,320       32,049       44,642       30,287  
Local marketing agreement fees
    99       269       379       455       1,027       1,334       1,326       1,268  
Asset impairment and disposal charges(2)
                            985,653       1,208,208       1,612,443       174,049  
Depreciation and amortization
    23,043       6,855       58,564       11,365       35,599       45,264       30,678       16,740  
Non-cash amounts related to contractual obligations(3)
                                  21,440              


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    Successor     Predecessor     Successor     Predecessor  
                Period
    Period
                         
                from
    from
                         
    Three
    Three
    June 1,
    January 1,
                         
    Months
    Months
    2010
    2010
                         
    Ended
    Ended
    through
    through
                         
    March 31,
    March 31,
    December 31,
    May 31,
    Years Ended December 31,  
    2011     2010     2010     2010     2009     2008     2007     2006  
    (Unaudited)                                      
    (Dollars in thousands, except per share amounts)  
 
Other, net(4)
    7,284       (2 )     7,486       854       6,841       (1,688 )     (3,900 )     (1,026 )
                                                                 
Total operating expenses:
    159,592       127,891       371,054       216,288       1,565,959       1,887,138       2,135,527       468,146  
                                                                 
Operating income (loss)
    430       37,137       73,088       79,136       (842,339 )     (1,024,017 )     (1,415,770 )     (35,216 )
                                                                 
Reorganization items, net(5)
          13,480             (1,014,077 )     4,556                    
Interest expense, net
    12,411       10,521       45,365       17,771       190,175       211,818       100,741       32,911  
Extinguishment of debt(6)
                20,969             (428 )     (114,736 )            
Write-off of deferred financing costs and debt discount upon extinguishment of debt and other debt related fees(6)
                984             814       11,399       555        
                                                                 
(Loss) income before income taxes
    (11,981 )     13,136       5,770       1,075,442       (1,037,456 )     (1,132,498 )     (1,517,066 )     (68,127 )
Income tax (benefit) expense
    (5,343 )     1,656       7,553       5,737       (254,097 )     (162,679 )     (231,830 )     (20,113 )
                                                                 
Net (loss) income applicable to common shares
  $ (6,638 )   $ 11,480     $ (1,783 )   $ 1,069,705     $ (783,359 )   $ (969,819 )   $ (1,285,236 )   $ (48,014 )
                                                                 
Net (loss) income per share:
                                                               
Basic
  $ (0.15 )   $ 0.04     $ (0.04 )   $ 4.02     $ (2.97 )   $ (3.69 )   $ (6.61 )   $ (0.43 )
                                                                 
Diluted
  $ (0.15 )   $ 0.04     $ (0.04 )   $ 3.99     $ (2.97 )   $ (3.69 )   $ (6.61 )   $ (0.43 )
                                                                 
Dividends declared per share
  $     $     $     $     $     $     $ 0.18     $ 0.54  
                                                                 
Special distribution declared per share
  $     $     $     $     $     $     $ 2.4631     $  
                                                                 
Weighted average common shares outstanding:
                                                               
Basic
    45,625       266,085       45,625       266,041       263,989       262,812       194,374       111,453  
                                                                 
Diluted
    45,625       268,005       45,625       267,961       263,989       262,812       194,374       111,453  
                                                                 
Other data:
                                                               
Cash flow provided by (used in):
                                                               
Operating activities
  $ 36,872     $ 48,489     $ 93,636     $ 44,587     $ 65,653     $ 130,852     $ 171,923     $ 136,277  
Investing activities
    441       (5,830 )     (278 )     (11,152 )     (10,148 )     (9,838 )     (1,588 )     (41,516 )
Financing activities
    (3,680 )     (41 )     (72,480 )     (130 )     (16,698 )     (302,701 )     26,239       (95,234 )
Capital expenditures
    1,558       2,164       6,671       3,409       7,761       8,920       12,345       11,790  
Current tax expense (benefit)
    272       280       1,496       587       (8,580 )     13,489       3,512       2,491  
Deferred tax (benefit) expense
    (5,615 )     1,376       6,057       5,150       (245,517 )     (176,168 )     (235,342 )     (22,604 )
 

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    Successor     Predecessor  
    March 31,
    December 31,
    December 31,  
    2011     2010     2009     2008     2007     2006  
    (Unaudited)                          
    (Dollars in thousands)  
 
Balance sheet data:
                                               
Cash and cash equivalents
  $ 145,257     $ 111,624     $ 57,441     $ 18,634     $ 200,321     $ 3,747  
Intangible assets, net(2)
    1,858,682       1,883,389       960,058       1,963,973       3,211,303       1,967,204  
Total assets
    2,407,445       2,408,114       1,417,989       2,432,970       3,843,435       2,173,696  
Long-term debt and other liabilities (including current portion)
    803,065       808,428       2,243,025       2,206,918       2,532,527       751,021  
Liabilities subject to compromise(7)
                2,270,418                    
Stockholders’ equity (deficit)
    1,280,050       1,274,657       (1,071,858 )     (298,948 )     627,239       1,124,308  
Working capital(8)
    249,166       227,632       201,443       106,141       324,497       50,438  
Working capital with liabilities subject to compromise(8)
                (2,068,975 )                  
 
 
(1) Citadel’s selected consolidated historical financial data includes the operating results, acquired assets and assumed liabilities of Citadel’s consummation of the separation of the ABC Radio Network business and 22 ABC radio stations (collectively, the “ABC Radio Business”) from The Walt Disney Company and its subsidiaries subsequent to June 12, 2007, the closing date of its acquisition by Citadel.
 
(2) Citadel performed its 2010 annual evaluation of FCC licenses and goodwill as of October 1, the annual testing date. Based on the results of Citadel’s 2010 annual impairment evaluation, the fair values of its FCC Authorizations more likely than not exceeded their carrying values and, therefore, no impairment of these assets had occurred as of the date of the annual test. Citadel conducted impairment tests during the years ended December 31, 2009, 2008, 2007 and 2006, which resulted in non-cash impairment charges of $933.1 million, $1,197.4 million, $1,591.5 million and $174.0 million, respectively, on a pre-tax basis, to reduce the carrying amounts of its FCC Authorizations and goodwill. Asset impairment charges of $42.6 million, on a pre-tax basis, were recognized by Citadel during the year ended December 31, 2009 to reduce the carrying amounts of its customer and affiliate relationships to their estimated fair values. Additionally, Citadel recognized non-cash impairment and disposal charges of $10.0 million, $10.8 million and $20.9 million during the years ended December 31, 2009, 2008 and 2007, respectively, to write down the carrying amounts of certain stations to be divested by it to their estimated fair market values.
 
(3) Operating income for 2008 reflects a non-cash charge of approximately $21.4 million primarily due to Citadel’s settlement with its previous national representation firm. Under the terms of the settlement, Citadel’s new representation firm settled Citadel’s obligations under the settlement agreement with its previous representation firm and entered into a new long-term contract with Citadel.
 
(4) Other, net of approximately $7.3 million for the three months ended March 31, 2011 includes approximately $6.5 million in costs related to the merger. For the period from June 1, 2010 through December 31, 2010, other, net of $7.5 million includes approximately $6.0 million of bankruptcy-related expenses incurred by the Successor. Other, net of approximately $6.8 million for 2009 includes $9.0 million of bankruptcy-related costs for financial advisory services and legal expenditures, offset by income due to a contract adjustment related to the ABC Radio Business of approximately $2.4 million.
 
(5) Reorganization costs associated with the Predecessor’s bankruptcy filing in December 2009 were $13.5 million for the three months ended March 31, 2010. This amount represented $11.4 million in professional fees paid for legal, consulting, and other related services and $2.1 million to adjust the liability related to rejected executory contracts to their estimated allowed claim amounts. Included in

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reorganization items during the period from January 1, 2010 through May 31, 2010 were (a) adjustments resulting from the application of fresh-start accounting to reflect the revaluation of assets and liabilities upon Citadel’s emergence from bankruptcy, resulting in a net gain of $921.8 million, (b) the restructuring of Citadel’s capital structure and resulting discharge of pre-petition debt in accordance with Citadel’s second modified joint plan of reorganization (the “Emergence Plan”), resulting in a gain of $139.8 million and (c) expenses incurred related to certain emergence-related items, legal, consulting and other professional services, and amounts resulting from the rejection of certain executory contracts of $47.5 million. The reorganization items incurred during the year ended December 31, 2009 represent primarily $4.1 million for the write-off of deferred financing costs and $0.5 million in professional fees incurred by the Predecessor. Beginning on the Fresh-Start Date, continuing expenses related to the remaining bankruptcy matters are recorded in other, net in the Successor’s statement of operations.
 
(6) During the period from June 1, 2010 through December 31, 2010, Citadel repaid the principal balance outstanding under a term loan, dated as of June 3, 2010, among Citadel, the several lenders party thereto and JPMorgan Chase Bank, N.A. (the “Emergence Term Loan Facility”) with the proceeds from the issuance of the Citadel Senior Notes and borrowings under a separate term loan agreement, along with cash on hand. Pursuant to the terms of the Emergence Term Loan Facility, a prepayment penalty of $38.0 million was incurred; this was netted against the write off of the unamortized balance of the valuation adjustment of $17.1 million, which resulted in loss on extinguishment of debt of $21.0 million. In connection with this repayment, Citadel also wrote off the unamortized balance of deferred financing costs of $1.0 million. On June 12, 2007, the Predecessor entered into a senior credit and term facility (the “Predecessor Senior Credit and Term Facility”) and used the proceeds to repay the outstanding balance of Citadel’s then-existing senior credit facility. As a result, Citadel wrote off $0.6 million of deferred financing costs. The Predecessor Senior Credit and Term Facility was amended in 2008 and 2009, which, among other things, permitted Citadel to make voluntary prepayments of the Predecessor Senior Credit and Term Facility, subject to certain conditions. In connection with these modifications and the related prepayments, during the years ended December 31, 2009 and 2008, Citadel wrote off $0.2 million and $3.5 million of debt issuance costs, respectively. Additionally, in connection with the fourth amendment to the Predecessor Senior Credit and Term Facility in March 2009, Citadel recognized expense of $0.6 million related to costs paid to third parties, and Citadel wrote off $0.6 million in debt issuance costs related to the third amendment to the Predecessor Senior Credit and Term Facility in November 2008, which permanently reduced the aggregate revolving credit commitments available. In connection with the repurchase of a portion of Citadel’s convertible subordinated notes, Citadel also wrote off approximately $2.3 million of debt issuance costs and $5.0 million of debt discount during the year ended December 31, 2008. Also in 2008, Citadel recognized gains of approximately $58.4 million and $56.3 million, both net of transaction fees, related to the early extinguishment of a portion of its Predecessor Senior Credit and Term Facility and the repurchase of a portion of its convertible subordinated notes, respectively. The repurchase of a portion of the convertible subordinated notes during the year ended December 31, 2009 resulted in a gain of $0.4 million.
 
(7) Liabilities subject to compromise consist of pre-petition claims that were expected to be restructured or impaired pursuant to the Emergence Plan and include primarily the balance of Citadel’s senior debt as of December 31, 2009.
 
(8) Working capital is calculated using current assets less current liabilities not subject to compromise. Working capital with liabilities subject to compromise is calculated using current assets less current liabilities and liabilities subject to compromise.


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UNAUDITED SELECTED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION
 
The following unaudited selected pro forma condensed consolidated financial information is based on the historical consolidated financial statements of each of Cumulus Media and Citadel, each of which are incorporated by reference in this information statement/proxy statement/prospectus.
 
The following unaudited selected pro forma condensed consolidated financial information is intended to provide you with information about how each of the CMP Acquisition and the merger, and the related refinancing transactions, might have affected Cumulus Media’s historical consolidated financial statements if such transactions had closed as of January 1, 2010, in the case of the statements of operations information and as of March 31, 2011, in the case of the balance sheet information.
 
The unaudited selected pro forma condensed consolidated financial information is presented on:
 
  •  a “CMP Pro Forma Basis,” giving effect to the 2019 Notes Offering and the CMP Acquisition (including certain developments in CMP’s business);
 
  •  a “Citadel Pro Forma Basis,” giving effect to the 2019 Notes Offering, the merger and the Global Refinancing (excluding any portion thereof related to the refinancing of CMP Debt); and
 
  •  an “Overall Pro Forma Basis,” giving effect to the 2019 Notes Offering, the CMP Acquisition (including certain developments in CMP’s business), the merger and the Global Refinancing.
 
Pursuant to the merger agreement, Cumulus Media has agreed to issue to holders of Citadel common stock (including holders of warrants to acquire Citadel common stock) up to 151,485,282 shares of Cumulus Media common stock (plus an additional number of shares based upon the number of shares of common stock that are issued upon the exercise of stock options to purchase shares of Citadel common stock prior to the closing date of the merger and have agreed to pay to holders of Citadel common stock (including holders of warrants to acquire Citadel common stock) up to $1,408.7 million in cash (plus an additional amount based upon the number of Citadel shares of common stock that are issued upon the exercise of stock options to purchase shares of Citadel common stock prior to the closing of the merger, less the cash value of any dissenting shares), with the actual number of shares to be issued, and amount of cash to be paid, dependent upon elections to be made by Citadel stockholders prior to the completion of the merger. For purposes of this unaudited selected pro forma condensed consolidated financial information, Cumulus Media has assumed that the merger consideration will consist of $1,258.2 million in cash and the issuance of 114,872,375 shares of Cumulus Media Class A common stock (which represents the arithmetic mean, or “midpoint,” of the amount of cash which would be payable, and the number of shares of Cumulus Media Class A common stock which would be issuable to holders of Citadel common stock based on the Cash Consideration Cap and the Stock Consideration Cap), which shares have an assumed aggregate value of $390.6 million (based on an assumed price per share of Cumulus Media Class A common stock of $3.40, the closing price of such common stock on the Nasdaq Global Select Market on June 20, 2011, the most recent practicable date). If Citadel stockholders and warrant holders make elections such that the merger consideration is payable at the Cash Consideration Cap, Cumulus Media would potentially draw an additional $70.0 million under the revolving credit facility from that shown as borrowed under the mid-point model presented in the following unaudited selected pro forma condensed consolidated financial information, which would have resulted in additional interest expense of $0.6 million for the three months ended March 31, 2011 and $2.6 million for the twelve months ended December 31, 2010.
 
Each of the CMP Acquisition and the merger will be accounted for as a business combination using the acquisition method of accounting and, accordingly, is expected to result in the recognition of assets acquired and liabilities assumed at fair value. However, as of the date of this information statement/proxy statement/prospectus, Cumulus Media has not performed the valuation studies necessary to estimate the fair values of the assets Cumulus Media expects to acquire and the liabilities Cumulus Media expects to assume to reflect the allocation of purchase price to the fair values of such amounts.
 
For purposes of preparing the pro forma adjustments to reflect the CMP Acquisition, Cumulus Media has estimated the fair values of the indefinite-lived intangible assets based on information available as of December 31, 2010. For purposes of preparing the pro forma adjustments to reflect the merger, Cumulus Media has carried forward the net book value of the tangible assets and indefinite-lived and definite-lived intangible assets from those appearing in Citadel’s consolidated financial statements as of December 31, 2010, which are incorporated by reference into this information statement/proxy statement/prospectus, as Cumulus Media does not have any


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independent third-party valuations or other valuation studies estimating the value of these intangible assets. However, due to Citadel’s application of fresh-start accounting upon its emergence from bankruptcy on June 3, 2010, Citadel’s tangible and intangible assets were adjusted to fair value during 2010. For each of the CMP Acquisition and the merger, the excess of the consideration expected to be transferred over the fair value of the net assets expected to be acquired has been presented as an adjustment to goodwill. Cumulus Media has not estimated the fair value of other assets expected to be acquired or liabilities expected to be assumed, including, but not limited to, current assets, property and equipment, current liabilities, other miscellaneous liabilities and other finite-lived intangible assets and related deferred tax liabilities. A final determination of these fair values will be based upon appraisals prepared by independent third parties and on the actual tangible and identifiable intangible assets and liabilities that exist as of the closing date of each respective acquisition. The actual allocations of the consideration transferred may differ materially from the allocation assumed in this unaudited selected pro forma condensed consolidated financial information.
 
The presentation of financial information on an Overall Pro Forma Basis for the year ended December 31, 2010 includes the combined results of operations of Citadel for its predecessor and successor periods. In connection with its emergence from bankruptcy on June 3, 2010 and in accordance with accounting guidance on reorganizations, Citadel adopted fresh-start accounting as of May 31, 2010. See the footnotes to Citadel’s audited historical financial statements incorporated by reference into this information statement/proxy statement/prospectus, for more information. Historical financial results of Citadel are presented for the “Predecessor” entity for periods prior to Citadel’s emergence from bankruptcy and for the “Successor” entity for periods after Citadel’s emergence from bankruptcy. As a result, financial results of periods prior to Citadel’s adoption of fresh-start accounting are not comparable to financial results of periods after that date. The combined operating results of Citadel including the Successor and Predecessor periods in 2010 are not necessarily indicative of the results that may be expected for a full fiscal year. Presentation of the combined financial information of the Predecessor and Successor for the twelve months ended December 31, 2010 is not in accordance with GAAP. However, Citadel believes that the combined financial information is useful for management and investors to assess Citadel’s ongoing financial and operational performance and trends.
 
The unaudited pro forma condensed consolidated financial information below is based upon currently available information and estimates and assumptions that Cumulus Media believes are reasonable as of the date hereof. These estimates and assumptions relate to matters including, but not limited to, Cumulus Media’s stock price at the date of closing of each of the CMP Acquisition and the merger (assumed to be $3.40 per share, the closing price of Cumulus Media’s common stock on the Nasdaq Global Select Market on June 20, 2011, the most recent practicable date), which will be used to determine a portion of the final purchase price consideration, the LIBOR rate in effect for borrowings at the date of closing of the Global Refinancing, which will be used to determine the interest rate on borrowings under the Acquisition Credit Facility, and the form of the investment in Cumulus Media equity securities made by MIHI LLC pursuant to the Investment Agreement, which is assumed to be common stock, all of which will impact, among other things, Cumulus Media’s available cash, interest expense and stockholders’ equity. Cumulus Media has also assumed that, in connection with obtaining FCC or other federal regulatory approvals required to complete the merger, any radio stations that Cumulus Media may be required to divest would not be material to its consolidated financial position or results of operations and, as a result, it has not made a provision in this unaudited pro forma condensed consolidated financial information for any such divestitures.
 
Any of the factors underlying these estimates and assumptions may change or prove to be materially different, and the estimates and assumptions may not be representative of facts existing at the closing date of either the CMP Acquisition or the merger. The unaudited pro forma condensed consolidated financial information is presented for illustrative and informational purposes only and is not intended to represent or be indicative of what Cumulus Media’s financial condition or results of operations would have been had the transactions described above occurred on or as of the dates indicated. The unaudited pro forma condensed consolidated financial information also should not be considered representative of Cumulus Media’s future financial condition or results of operations. In addition to the pro forma adjustments to Cumulus Media’s historical consolidated financial statements, various other factors are expected to have an effect on Cumulus Media’s financial condition and results of operations, both before and after the closing of each of the CMP Acquisition or the merger and related financing transactions.


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You should read the unaudited selected pro forma condensed consolidated financial information in conjunction with the information under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in each of Cumulus Media’s and Citadel’s respective Annual Reports on Form 10-K for the fiscal year ended December 31, 2010 and Quarterly Reports on Form 10-Q for the three months ended March 31, 2011, each of which is incorporated by reference in this information statement/proxy statement/prospectus, and the information under the heading “Index to Unaudited Pro Forma Condensed Consolidated Financial Information,” which is included elsewhere in this information statement/proxy statement/prospectus. You should also read this information in conjunction with each of Cumulus Media’s and Citadel’s consolidated financial statements and the related notes, which are incorporated by reference in this information statement/proxy statement/prospectus, and the consolidated financial statements and the related notes of CMP, which are included elsewhere in this information statement/proxy statement/prospectus.
 
                                                 
    Three Months Ended
    Year Ended
 
    March 31, 2011     December 31, 2010  
    CMP Pro
    Citadel Pro
    Overall Pro
    CMP Pro
    Citadel Pro
    Overall Pro
 
    Forma Basis     Forma Basis     Forma Basis     Forma Basis     Forma Basis     Forma Basis  
    (Dollars in thousands)  
 
Statement of Operations Data:
                                               
Net revenues
  $ 94,222     $ 217,880     $ 254,244     $ 441,008     $ 1,002,899     $ 1,180,574  
Station operating expenses (excluding depreciation, amortization and LMA fees)
    59,748       152,269       174,462       256,824       632,723       729,740  
Depreciation and amortization
    3,796       25,166       26,839       15,894       99,231       106,027  
LMA fees
    581       680       680       2,054       2,888       2,888  
Corporate general and administrative (including non-cash stock compensation expense)
    9,150       22,581       23,602       21,778       60,342       63,601  
Gain (loss) on exchange of assets or stations
    (15,158 )     (14,992 )     (14,992 )     29       1,130       1,159  
Realized loss on derivative instrument
    40       40       40       1,957       1,957       1,957  
Impairment of intangible assets and goodwill(1)
                      671       671       671  
Other operating (expense) income
    (6 )     7,118       7,112             7,210       7,210  
                                                 
Operating income
    36,071       25,018       36,501       141,801       196,747       267,321  
Interest expense, net
    (16,839 )     (31,484 )     (38,754 )     (70,835 )     (124,940 )     (154,947 )
Terminated transaction expense
                      (7,847 )     (7,847 )     (7,847 )
Other income (expense), net
                      107       108       107  
Income tax (expense) benefit
    (2,384 )     8,041       6,570       (14,153 )     (3,295 )     (17,668 )
                                                 
Net income (loss)
  $ 16,848     $ 1,575     $ 4,317     $ 49,073     $ 60,773     $ 86,966  
                                                 
 
                         
    As of March 31, 2011
    CMP
  Citadel
  Overall
    Pro Forma
  Pro Forma
  Pro Forma
    Basis   Basis   Basis
    (Dollars in thousands)
 
Balance Sheet Data:
                       
Total assets
  $ 1,196,614     $ 3,122,457     $ 3,938,343  
Long-term debt (including current portion)
    1,230,984       2,287,161       2,908,145  
Total stockholders’ (deficit) equity
    (213,896 )     391,096       477,943  
 
(1) Impairment charge recorded in connection with Cumulus Media’s interim and annual impairment testing under ASC 350. See Note 4, “Intangible Assets and Goodwill,” in the notes to Cumulus Media’s audited consolidated financial statements incorporated by reference in this information statement/proxy statement/prospectus for further discussion.


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COMPARATIVE PER SHARE DATA
 
The following table shows, for the three months ended March 31, 2011 and the year ended December 31, 2010, historical and pro forma equivalent per share data for Citadel common stock and historical and pro forma combined per share data for Cumulus Media Class A common stock. The information in the table is derived from each of Cumulus Media’s and Citadel’s respective historical consolidated financial statements incorporated by reference herein, as well as the unaudited pro forma condensed consolidated financial information included elsewhere herein.
 
The Citadel pro forma equivalent information shows the effect of the merger from the perspective of an owner of Citadel common stock. The information was computed by multiplying the Citadel Pro Forma Basis combined (loss) income from continuing operations per share and Citadel Pro Forma Basis book value as of and for the respective period by the exchange ratio of 8.525 shares of Cumulus Media Class A common stock for each share of Citadel common stock in the merger, so that the per share amounts equate to the respective values for one share of Citadel common stock. For all periods presented, dividends are not included in the calculations as none were declared or paid. In the following tables, for all periods subsequent to Citadel’s adoption of fresh-start accounting, the Citadel common stock columns include the outstanding number of shares of both Citadel’s Class A common stock and Class B common stock and include warrants to purchase Citadel common stock, as all such components of Citadel’s equity are treated equally for accounting purposes, and the distinctions relate solely to certain voting restrictions and conversion mechanisms in order to allow Citadel to comply with applicable FCC rules and policies. Furthermore, the pro forma equivalent and pro forma combined computations in the table below assume that Cumulus Media issues only shares of its Class A common stock to Citadel stockholders in the merger, which will be treated equally with Cumulus Media’s Class B common stock (and warrants) for accounting purposes, with the distinctions relating only to certain voting restrictions and conversion mechanisms in order to allow Cumulus Media to comply with applicable FCC rules and policies. These computations exclude any potential impact, on a pro forma basis, of the completion of the CMP Acquisition, and also do not include any potential benefit to Citadel stockholders from receiving any amount of cash as a component of the merger consideration.
 
The Citadel Pro Forma Basis combined data below is presented for illustrative purposes only. The Citadel Pro Forma Basis adjustments to the statements of operations data are based on the assumption that the merger was consummated on January 1, 2010 in the case of the data for the three months ended March 31, 2011 and for the year ended December 31, 2010. The Citadel Pro Forma Basis adjustments to the balance sheet are based on the assumption that the merger was consummated on each of the respective dates presented below.
 
Actual financial condition and results of operations may have been different had the companies always been combined. You should not rely on this information as being indicative of the historical financial condition and results of operations that would have actually been achieved or of the future results of the combined company.
 
You should read the information below together with the historical financial statements and related notes of each of Cumulus Media and Citadel, which are incorporated by reference in this information statement/proxy statement/prospectus, as well as with the information under the heading “Index to Unaudited Pro Forma


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Condensed Consolidated Financial Information,” included elsewhere herein. See “Where You Can Find More Information” beginning on page        .
 
                                 
    Citadel Common Stock     Cumulus Media Class A Common Stock  
          Citadel
          Citadel
 
          Pro Forma
          Pro Forma
 
    Historical     Basis Equivalent     Historical     Basis Combined  
 
(Loss) Income from Continuing Operations Per Share
                               
Basic
                               
Three Months Ended March 31, 2011
  $ (0.15 )   $ 0.09     $ 0.38     $ 0.01  
Year Ended December 31, 2010
    (a )   $ 3.34     $ 0.70     $ 0.39  
Diluted
                               
Three Months Ended March 31, 2011
  $ (0.15 )   $ 0.09     $ 0.37     $ 0.01  
Year Ended December 31, 2010
    (a )   $ 3.32     $ 0.69     $ 0.39  
Cash Dividends Declared Per Share
                               
Three Months Ended March 31, 2011
                       
Year Ended December 31, 2010
    (a )                  
Book Value Per Share
                               
March 31, 2011
  $ 56.22     $ 21.34     $ (8.99 )   $ 2.50  
December 31, 2010
  $ 56.22       N/A     $ (9.60 )     N/A  
 
 
(a) As a result of Citadel’s emergence from Chapter 11 proceedings and its adoption of fresh-start accounting, historical information relating to Citadel common stock during the year ended December 31, 2010 is shown for the Predecessor for the period from January 1, 2010 through May 31, 2010, and for the Successor for the period from June 1, 2010 through December 31, 2010.
 
         
    Citadel Common Stock  
    Historical  
 
Loss (Income) from Continuing Operations Per Share
       
Basic
       
Successor-Period from June 1, 2010 through December 31, 2010
  $ (0.04 )
Predecessor-Period from January 1, 2010 through May 31, 2010
  $ 4.02  
Diluted
       
Successor-Period from June 1, 2010 through December 31, 2010
  $ (0.04 )
Predecessor-Period from January 1, 2010 through May 31, 2010
  $ 3.99  
Cash Dividends Declared Per Share
       
Successor-Period from June 1, 2010 through December 31, 2010
  $  
Predecessor-Period from January 1, 2010 through May 31, 2010
  $  


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COMPARATIVE MARKET VALUE OF SECURITIES
 
Cumulus Media Class A common stock is quoted on the Nasdaq Global Select Market under the symbol “CMLS.” Citadel Class A common stock and Citadel Class B common stock are each quoted by the OTC Link on the OTCQB tier under the symbols “CDELA” and “CDELB,” respectively. The following table shows the closing prices of each of Cumulus Media Class A common stock, Citadel Class A common stock and Citadel Class B common stock as reported on March 9, 2011, the last trading day prior to the public announcement of the merger, and on       , 2011, the latest practicable date prior to the date of this information statement/proxy statement/prospectus. This table also shows the implied value of the merger consideration for each share of Citadel Class A common stock and Class B common stock, which was calculated by multiplying the closing price of Cumulus Media Class A common stock on the relevant date by the exchange ratio of 8.525 shares of Cumulus Media Class A common stock for each share of Citadel common stock. For purposes of this table, Cumulus Media assumed the issuance only of shares of Cumulus Media Class A common stock to Citadel stockholders in the merger, which shares have a publicly quoted market price, and which will be treated equally with Cumulus Media’s Class B common stock (and warrants) for accounting purposes, with the distinctions relating only to certain voting restrictions and conversion mechanisms in order to allow Cumulus Media to comply with applicable FCC rules and policies. These computations also do not include any potential benefit to Citadel stockholders from receiving any amount of cash as a component of merger consideration.
 
                                 
    Closing Price of
           
    Cumulus
  Closing Price of
  Closing Price of
  Implied Value of
    Media Class A
  Citadel Class A
  Citadel Class B
  Merger
    Common Stock   Common Stock   Common Stock   Consideration
 
As of March 9, 2011
  $ 5.10     $ 34.00     $ 34.37     $ 43.48  
As of          , 2011
  $                $                $                $             
 
The market price of Cumulus Media Class A common stock and Citadel Class A common stock and Citadel Class B common stock will fluctuate prior to Citadel’s annual meeting and before the merger is completed, which will affect the implied value of the merger consideration to Citadel stockholders. You should obtain current market quotations for the shares before making any decisions with respect to the merger.


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CITADEL ANNUAL MEETING
 
Information Statement/Proxy Statement/Prospectus
 
This information statement/proxy statement/prospectus is being furnished to Citadel stockholders in connection with the solicitation of proxies by Citadel’s board of directors in connection with the annual meeting of Citadel stockholders.
 
This information statement/proxy statement/prospectus and the enclosed proxy card(s) are first being sent to Citadel stockholders on or about       , 2011.
 
Date, Time and Place of the Citadel Annual Meeting
 
The Citadel annual meeting is to be held on       , 2011, at       , at       .
 
Purpose of the Citadel Annual Meeting
 
At the Citadel annual meeting, holders of Citadel Class A common stock as of the record date will be asked to:
 
1. consider and vote upon the adoption of the merger agreement;
 
2. consider and vote upon the approval of the adjournment of the annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the annual meeting;
 
3. consider and vote upon the election of two class I director nominees to Citadel’s board of directors;
 
4. consider and vote on a non-binding, advisory basis to approve compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger;
 
5. consider and vote upon the ratification of the appointment of Deloitte & Touche LLP to serve as Citadel’s independent registered public accountants for the year ending December 31, 2011; and
 
6. consider and act upon such other business as may properly come before the annual meeting or any adjournment or postponement thereof.
 
In addition, at the Citadel annual meeting, holders of Citadel Class B common stock as of the record date will be asked to consider and vote, together with holders of Citadel Class A common stock as of the record date as a single class, upon Proposals 1 and 5 described above.
 
At this time, Citadel is not aware of any other matters that will be presented for a vote at the annual meeting. However, if any other matters properly come before the annual meeting, the proxies will have the discretion to vote upon such matters in accordance with their best judgment.
 
Voting Electronically or by Telephone
 
If your shares of common stock of Citadel are registered directly in your name on the records of The Bank of New York Mellon, you are considered a stockholder of record and will receive proxy materials from Citadel. If your shares are held through a broker, bank or other financial institution, you are considered the beneficial owner of shares held in street name and will receive proxy materials from your broker, bank or other institution.
 
Whether or not you plan to attend the Citadel annual meeting, your vote is important, and Citadel encourages you to vote promptly. You can ensure your shares are represented at the annual meeting by promptly submitting your proxy by Internet or by voting by telephone or marking, signing, dating and returning the appropriate proxy card in the envelope provided. Each valid proxy received in time will be voted at the annual meeting according to the choice specified, if any. A proxy may be revoked at any time before the proxy is voted, as outlined below.


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Record Date and Voting
 
Holders of record, at the close of business on       , 2011, of Citadel Class A common stock will be entitled to notice of and to vote at the Citadel annual meeting with regard to Proposals 1-5 described above. Holders of Citadel Class B common stock as of the record date will be entitled to notice of and to vote at the annual meeting, together with holders of Citadel Class A common stock as of the record date as a single class, with regard to Proposals 1 and 5 described above. On the record date there were        total shares of Citadel common stock outstanding and entitled to vote at the annual meeting, held by approximately        holders of record. Each of the        shares of Citadel Class A common stock issued and outstanding on the record date is entitled to one vote at the annual meeting with regard to Proposals 1-5, and each of the        shares of Citadel Class B common stock issued and outstanding on the record date is entitled to one vote at the annual meeting with regard to Proposals 1 and 5.
 
In order for business to be conducted at the Citadel annual meeting, a quorum must be present. For all matters, a majority of the shares of Citadel Class A common stock and Citadel Class B common stock, voting together as a single class, issued and outstanding as of the close of business on the record date and entitled to vote at the annual meeting, present in person or represented by proxy, constitutes a quorum. If a broker or other record holder of shares returns a proxy card indicating that it does not have discretionary authority to vote as to a particular matter, those shares will be treated as not entitled to vote on that matter. Abstentions and broker non-votes will be counted as shares present for purposes of determining whether a quorum is present.
 
If your proxy card is properly executed and received by Citadel in time to be voted at the Citadel annual meeting, the shares represented by your proxy (including those given through the Internet or by telephone) will be voted in accordance with the instructions that you mark on your proxy card. Executed but unvoted proxies will be voted in accordance with the recommendations of Citadel’s board of directors.
 
Vote by Citadel’s Directors and Executive Officers
 
As of the record date, Citadel directors and executive officers, and their affiliates, as a group, owned and were entitled to vote        shares of Citadel Class A common stock, or approximately       % of the outstanding Citadel Class A common stock, and        shares of Citadel Class B common stock, or approximately       % of the outstanding Citadel Class B common stock, and together with Citadel Class A common stock, approximately       % of the outstanding shares of Citadel common stock. Citadel currently expects that its directors and executive officers will vote their shares in favor of Proposals 1, 2, 4 and 5, and in favor of each of the director nominees in Proposal 3, but none of Citadel’s directors or executive officers have entered into any agreement obligating them to do so.
 
Vote Required
 
Proposal 1 requires the affirmative vote of a majority of the outstanding shares of Citadel Class A common stock and Class B common stock as of the record date, voting together as a single class, to be approved. Proposal 5 requires the affirmative vote of a majority of the votes cast at the annual meeting by holders of Citadel Class A common stock and Class B common stock as of the record date, voting together as a single class, to be approved.
 
Proposals 2 and 4 require the affirmative vote of a majority of the votes cast at the annual meeting by holders of Citadel Class A common stock as of the record date to be approved. Proposal 3 requires the affirmative vote of a plurality of the votes at the annual meeting by holders of Citadel Class A common stock as of the record date to be approved. With respect to each director nominee, Proposal 3 requires the affirmative vote of a plurality of the votes cast in person or by proxy at the Citadel annual meeting by holders of Citadel Class A common stock as the record date to be approved.
 
Adoption of merger agreement.  The affirmative vote of the holders of a majority of the outstanding shares of Citadel Class A common stock and Class B common stock outstanding as of the record date, voting together as a single class, is required to adopt the merger agreement. The required vote of Citadel stockholders


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on the merger agreement is based upon the number of outstanding shares of Citadel common stock, and not the number of shares that are actually voted. Brokers do not have discretionary authority to vote on this Proposal. The failure to submit a proxy card or to vote by Internet, telephone or in person at the annual meeting of Citadel stockholders or the abstention from voting by Citadel stockholders, or the failure of any Citadel stockholder who holds shares in “street name” through a bank or broker to give voting instructions to such bank or broker (a “broker non-vote”), will have the same effect as a vote against the adoption of the merger agreement.
 
Approval of the adjournment of Citadel’s annual meeting.  The affirmative vote of a majority of the votes cast by holders of Citadel Class A common stock outstanding as of the record date at the annual meeting is required to approve the Proposal to adjourn the annual meeting, if necessary or appropriate, to solicit additional proxies if there are insufficient votes at the time of the annual meeting to adopt the merger agreement. The required vote of holders of Citadel Class A common stock to approve the Proposal to adjourn the annual meeting of Citadel stockholders, if necessary, to solicit additional proxies is based on the number of shares that are actually voted, not on the number of outstanding shares of Citadel Class A common stock. Brokers do not have discretionary authority to vote on this Proposal. The failure to submit a proxy card or to vote by Internet, telephone or in person at the annual meeting of Citadel’s stockholders or the abstention from voting by holders of Citadel Class A common stock, or a broker non-vote, will have no effect on the Proposal to adjourn the annual meeting of Citadel’s stockholders, if necessary, to solicit additional proxies.
 
Election of directors.  The affirmative vote of a plurality of the shares of Citadel Class A common stock represented in person or by proxy at the Citadel annual meeting is required to elect each of the two class I director nominees to Citadel’s board of directors. Brokers do not have the discretionary authority to vote on the election of directors. Abstentions and broker non-votes will not be counted as votes cast and, therefore, will have no effect in determining whether a director has received a plurality for his or her election.
 
Advisory vote on golden parachute compensation.  The affirmative vote of a majority of the votes cast by the holders of Citadel Class A common stock outstanding as of the record date at the Citadel annual meeting is required to approve on a non-binding, advisory basis compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger. While Citadel’s board of directors intends to carefully consider the vote resulting from this Proposal, the vote is advisory, and therefore not binding on Citadel, its compensation committee or its board of directors. Brokers do not have discretionary authority to vote on this Proposal. Abstentions and broker non-votes will not be counted as votes cast and, therefore, will have no effect on this Proposal.
 
Ratification of appointment of Deloitte & Touche LLP as Citadel’s independent registered public accountants.  The affirmative vote of a majority of the votes cast by holders of Citadel Class A common stock and Citadel Class B common stock outstanding as of the record date, voting together as a single class, at the Citadel annual meeting is required to ratify the appointment of Deloitte & Touche LLP as Citadel’s independent registered public accountants for the year ending December 31, 2011. The ratification of the selection of Deloitte & Touche LLP as Citadel’s independent registered public accounting firm for 2011 is deemed to be a discretionary matter and brokers will be permitted to vote uninstructed shares as to such matter. Abstentions will not be counted as votes cast and, therefore, will have no effect on this Proposal.
 
Other matters.  As of the date of this information statement/proxy statement/prospectus, Citadel’s board of directors knows of no matters that will be presented for consideration at the Citadel annual meeting other than as described in this information statement/proxy statement/prospectus. If any other matters properly come before the Citadel annual meeting or any adjournments or postponements of the meeting and are voted upon, the enclosed proxies will confer discretionary authority on the individuals named as proxies to vote the shares represented by such proxy as to any other matters. The individuals named as proxies intend to vote in accordance with their best judgment as to any other matters. The affirmative vote of a majority of the votes cast by Citadel Class A common stock outstanding as of the record date at the Citadel annual meeting is required for the approval of any other matters.


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Recommendation of Citadel’s Board of Directors
 
Citadel’s board of directors recommends votes:
 
1. FOR the adoption of the merger agreement;
 
2. FOR the approval of the adjournment of the annual meeting, if necessary, to solicit additional proxies if there are not sufficient votes to adopt the merger agreement at the time of the annual meeting;
 
3. FOR the election of each of the class I director nominees to Citadel’s board of directors;
 
4. FOR the approval on a non-binding, advisory basis of compensation that may be paid or become payable to Citadel’s named executive officers that is based on or otherwise relates to the merger; and
 
5. FOR the ratification of the appointment of Deloitte & Touche LLP as Citadel’s independent registered public accountants for the year ending December 31, 2011.
 
Citadel’s board of directors did not, and does not, make any recommendation as to whether or to what extent any Citadel stockholder or warrant holder should elect cash or stock consideration in the merger. Citadel stockholders and warrant holders should carefully read this information statement/proxy statement/prospectus in its entirety for more detailed information concerning the merger agreement and the merger. In particular, Citadel stockholders and warrant holders are directed to the merger agreement, which is attached as Annex A hereto.
 
Revocability of Proxies
 
You may change or revoke your proxy at any time before the Citadel annual meeting by:
 
  •  delivering written notice of revocation to the Secretary, Citadel Broadcasting Corporation, 7690 W. Cheyenne Avenue, Suite 220, Las Vegas, Nevada 89129, in time for the Secretary to receive it before the annual meeting;
 
  •  voting again by Internet, telephone or mail (provided that such new vote is received in a timely manner pursuant to the instructions above); or
 
  •  voting in person at the annual meeting.
 
The last vote that Citadel receives from you will be the vote that is counted.
 
Inspector of Election
 
Citadel’s board of directors has appointed a representative of The Bank of New York Mellon to act as Inspector of Election at the Citadel annual meeting.
 
Attending the Citadel Annual Meeting
 
You are entitled to attend the Citadel annual meeting only if you are a stockholder of record of Citadel or you hold your shares of Citadel beneficially in the name of a bank, broker, or other nominee as of the record date, or you hold a valid proxy for the annual meeting.
 
If you are a stockholder of record of Citadel and wish to attend the Citadel annual meeting, please so indicate on the appropriate proxy card or as prompted by the telephone or Internet voting system. Your name will be verified against the list of stockholders of record prior to your being admitted to the annual meeting.
 
If a bank, broker or other nominee is the record owner of your shares of Citadel, you will need to have proof that you are the beneficial owner to be admitted to the Citadel annual meeting. A recent statement or letter from your bank or broker confirming your ownership as of the record date, or presentation of a valid proxy from a bank, broker or other nominee that is the record owner of your shares, would be acceptable proof of your beneficial ownership.


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You should be prepared to present photo identification for admittance. If you do not provide photo identification or comply with the other procedures outlined above upon request, you may not be admitted to the annual meeting.
 
Voting Procedures
 
You may vote your shares by proxy electronically via the Internet, by telephone, by sending in the appropriate paper proxy card or in person at the Citadel annual meeting.
 
Whether you vote your proxy electronically over the Internet, by telephone or by mail, Citadel will treat your proxy the same way. The individuals appointed as proxyholders will be Farid Suleman, Randy Taylor and Hilary Glassman. The shares of common stock of Citadel represented by valid proxies that are received in time for the Citadel annual meeting will be voted as specified in such proxies. Valid proxies include all properly executed, written paper proxy cards received pursuant to this solicitation that are not later revoked. Executed but unvoted proxies will be voted in accordance with the recommendations of Citadel’s board of directors.
 
Proxy Solicitations
 
Citadel is soliciting proxies for the Citadel annual meeting from Citadel stockholders. Citadel will reimburse brokers, banks, institutions and others holding common stock of Citadel as nominees for their expenses in sending proxy solicitation material to the beneficial owners of such common stock of Citadel and obtaining their proxies.
 
Stockholder Proposals
 
Any stockholders who intend to present proposals at Citadel’s 2012 annual meeting of stockholders, and who wish to have such proposals included in Citadel’s proxy statement for the 2012 annual meeting, must ensure that such proposals are received by the Secretary of Citadel not later than a reasonable time before          , 2012. Such proposals must meet the requirements set forth in the rules and regulations of the SEC in order to be eligible for inclusion in Citadel’s 2012 proxy solicitation material. Any proposals should be sent to the Secretary, Citadel Broadcasting Corporation, 7690 W. Cheyenne Avenue, Suite 220, Las Vegas, Nevada 89129. In the event the merger is completed before that date, it is not expected that Citadel would hold a 2012 annual meeting of stockholders.
 
Results of the Citadel Annual Meeting
 
The preliminary voting results will be announced at the Citadel annual meeting. In addition, within four business days following the Citadel annual meeting, Citadel intends to file the final voting results with the SEC on Form 8-K. If the final voting results have not been certified within that four business day period, Citadel will report the preliminary voting results on Form 8-K at that time and will file an amendment to the Form 8-K to report the final voting results within four days of the date that the final results are certified.


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CITADEL DIRECTORS AND EXECUTIVE OFFICERS
 
On December 20, 2009, Citadel and certain of its subsidiaries filed voluntary petitions in the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) seeking relief under the provisions of chapter 11 of title 11 of the United States Code (collectively, the “Chapter 11 Proceedings”). Upon emergence from the Chapter 11 Proceedings on June 3, 2010, a new board of directors was appointed, except for Mr. Suleman, Citadel’s chief executive officer, who continued to serve as Citadel’s chief executive officer and a member of Citadel’s board of directors. The following table sets forth the names and ages of Citadel’s executive officers and directors.
 
             
Name
 
Age
 
Position
 
Farid Suleman
    59     President, Chief Executive Officer and Director
Judith A. Ellis
    62     Chief Operating Officer
Randy L. Taylor
    48     Senior Vice President and Chief Financial Officer
Patricia Stratford
    48     Senior Vice President — Finance and Administration and Assistant Secretary
Hilary E. Glassman
    49     Senior Vice President, General Counsel and Corporate Secretary
John L. Sander
    69     Chairman of the Board of Directors
William M. Campbell, III
    51     Director
Jonathan Mandel
    59     Director
Gregory Mrva
    41     Director
Doreen A. Wright
    54     Director
 
Directors
 
Biographical information for each of Citadel’s directors is discussed in connection with Citadel’s discussion of Proposal 3, on page       .
 
Executive Officers
 
Listed below is biographical information for each person who is currently an executive officer of Citadel.
 
Farid Suleman has been Citadel’s President and Chief Executive Officer and a member of its board of directors since March 2002. Mr. Suleman was also the Chairman of the board from March 2002 through June 2010. From February 2001 to February 2002, Mr. Suleman was President and Chief Executive Officer of Infinity Broadcasting Corp., a radio and outdoor advertising company. He was Executive Vice President, Chief Financial Officer, Treasurer and a director of Infinity Broadcasting from September 1998 to February 2001 when Infinity Broadcasting was acquired by Viacom Inc. From February 1994 until February 2007, Mr. Suleman was a director of Westwood One, Inc. Mr. Suleman was a special limited partner of Forstmann Little & Co., a private equity firm, from March 2002 until June 2007.
 
Judith A. Ellis has been Citadel’s Chief Operating Officer since February 2003. From 1997 until joining Citadel, Ms. Ellis served as Senior Vice President/Market Manager for Emmis Communications Corporation, which owns and operates radio and magazine entities.
 
Randy L. Taylor has been Citadel’s Senior Vice President and Chief Financial Officer, and principal financial and accounting officer, since February 29, 2008. From February 1, 2008 until February 29, 2008, Mr. Taylor served as Citadel’s Acting Chief Financial Officer and acting principal financial and accounting officer. From November 2006 until February 2008, Mr. Taylor served as Citadel’s Vice President, Finance — Principal Accounting Officer. From January 2001 until September 2005, Mr. Taylor served as Citadel’s Vice President — Finance and Corporate Secretary. From September 2005 until September 2006, Mr. Taylor served as Vice President — Corporate Controller for Bally Technologies, Inc., a diversified, worldwide gaming device company.
 
Patricia Stratford has been Citadel’s Senior Vice President — Finance and Administration and Assistant Secretary since May 2006. From September 2005 until May 2006, Ms. Stratford served as Citadel’s Acting


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Chief Financial Officer, and was Citadel’s Vice President, Finance — Administration from August 2003 until October 1, 2005. Prior to joining Citadel, Ms. Stratford served as Director — Finance Administration and Benefits for Infinity Broadcasting Corporation from January 1999 until July 2003.
 
Hilary E. Glassman has been Citadel’s Senior Vice President, General Counsel and Corporate Secretary since February 2011. From July 2005 until July 2010, Ms. Glassman served as Senior Vice President, General Counsel and Secretary for Frontier Communications Corporation, a communications services provider. From February 2003 until July 2005, Ms. Glassman was associated with Sandler O’Neill & Partners, L.P., an investment bank with a specialized financial institutions practice, first as Managing Director, Associate General Counsel and then as Managing Director, Deputy General Counsel. From February 2000 until February 2003, Ms. Glassman was Vice President and General Counsel of Newview Technologies, Inc. (formerly e-Steel Corporation), a privately-held software company.
 
Other Matters Concerning Directors and Executive Officers
 
SEC regulations require Citadel to describe certain legal proceedings, including bankruptcy and insolvency filings involving its directors or executive officers or companies of which a director or executive officer was an executive officer at the time of filing. Each of the executive officers listed above, other than Ms. Glassman, served as an officer of Citadel at the time Citadel filed for protection under Chapter 11 of the Bankruptcy Code in December of 2009. Further, Mr. Suleman, Citadel’s chief executive officer, served as Chairman of the board at the time Citadel filed for protection under Chapter 11 of the Bankruptcy Code in December of 2009.
 
Effective December 31, 2009, Citadel’s radio music license agreements with the two largest performance rights organizations, American Society of Composers, Authors and Publishers (“ASCAP”) and Broadcast Music, Inc. (“BMI”) expired. The Radio Music License Committee (“RMLC”), which negotiates music licensing fees for most of the radio industry with ASCAP and BMI, had reached an agreement with these organizations on a temporary fee schedule that reflects a provisional discount of 7.0% against 2009 fee levels. The temporary fee reductions became effective in January 2010. Absent an agreement on longer-term fees between the RMLC and ASCAP and BMI, the U.S. District Court in New York has the authority to make an interim and permanent fee ruling for the new contract period. In May 2010 and June 2010 the U.S. District Court’s judges charged with determining the licenses fees ruled to further reduce interim fees paid to ASCAP and BMI, respectively, down approximately another 11.0% from the previous temporary fees negotiated with the RMLC. When the license fee negotiations are finalized, the rate will be retroactive to January 1, 2010, and the amounts could be greater or less than the temporary fees and could be material to Citadel’s financial results and cash flows. John Sander is currently the Chairman of the board of directors of both Citadel and BMI.
 
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS OF CITADEL
 
Ownership of Citadel Class A common stock
 
The following table sets forth information regarding the beneficial ownership of Citadel Class A common stock. The table includes:
 
  •  each person or group who is known by Citadel to own beneficially more than 5% of Citadel’s Class A common stock;
 
  •  each of Citadel’s current directors and nominees for election as a director;
 
  •  each current executive officer of Citadel named in the summary compensation table in this information statement/proxy statement/prospectus and each other person who served as an executive officer in 2010; and
 
  •  all such directors and all executive officers as a group.


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Beneficial ownership of shares is determined under rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power. Except as noted by footnote, and subject to community property laws where applicable, Citadel believes, based on the information provided to it, that the persons and entities named in the table below have sole voting and investment power with respect to all shares of Citadel’s Class A common stock shown as beneficially owned by them. The number of shares and the percentages of beneficial ownership of Citadel Class A common stock assume the conversion of all shares of Citadel Class B common stock (including shares underlying Citadel special warrants) into Citadel Class A common stock, and the exercise of all options, warrants and other securities convertible into Citadel Class A common stock currently exercisable or exercisable within 60 days of June 29, 2011. The percentages of beneficial ownership of Citadel Class A common stock and Class B common stock, voting together as a single class, assume for each person the exercise of all options, warrants and other securities convertible into Citadel Class A common stock or Class B common stock currently exercisable or exercisable within 60 days of June 29, 2011 by such person.
 
Percentage of beneficial ownership is based on 4,394,758 shares of Citadel Class A common stock and 19,059,409 shares of Citadel Class B common stock outstanding as of June 29, 2011, as well as 23,219,455 warrants to purchase Citadel common stock (including 285,932 reserved warrants). Unless otherwise indicated, the address for each holder listed below is c/o Citadel Broadcasting Corporation, 7690 W. Cheyenne Avenue, Suite 220, Las Vegas, Nevada 89129.
 
                         
        Class A and
        Class B
        Common Stock
        Beneficially
            Owned
            Percentage of
            Class A and B
    Class A Common Stock Beneficially Owned   Common Stock,
    Number of
  Percentage of
  Voting Together
Name and Address
  Class A Shares   Class A Shares   as a Single Class
 
Pentwater Capital Management LP(1)
    2,055,319       33.29 %     4.40 %
Third Point LLC(2)
    312,165       7.10 %     0.67 %
Farid Suleman(3)
    843,197       16.10 %     1.77 %
John L. Sander(3)
    21,082       0.48 %     0.05 %
William M. Campbell, III(3)
    21,082       0.48 %     0.05 %
Jonathan Mandel(3)
    21,082       0.48 %     0.05 %
Gregory Mrva(3)
    21,082       0.48 %     0.05 %
Doreen A. Wright(3)
    21,082       0.48 %     0.05 %
Judith A. Ellis(3)(4)
    67,355       1.52 %     0.14 %
Jacquelyn J. Orr(3)
    0       0.00 %     0.00 %
Randy L. Taylor(3)(4)
    49,484       1.12 %     0.11 %
Patricia Stratford(3)(4)
    37,950       0.86 %     0.08 %
Hilary E. Glassman(4)
    10,000       0.23 %     0.02 %
All board members and executive officers as a group (11 persons)
    1,113,396       20.44 %     2.33 %
 
 
(1) Information obtained solely by reference to the Schedule 13G filings made with the SEC on March 4, 2011 and April 1, 2011 by Pentwater Capital Management LP. The address of Pentwater Capital Management LP is 227 West Monroe Suite 4000, Chicago, IL 60606. The number of shares and the percentages of beneficial ownership of Citadel Class A common stock assume the conversion of all shares of Citadel Class B common stock (including shares underlying Citadel special warrants) into Citadel Class A common stock, and the exercise of all options, warrants and other securities convertible into Citadel Class A common stock currently exercisable or exercisable within 60 days of June 29, 2011.
 
(2) Information obtained solely by reference to the Schedule 13G filed with the SEC on February 11, 2011 by Third Point LLC, which serves as investment manager or adviser to a variety of hedge funds and managed accounts. Third Point LLC reported that such shares are indirectly beneficially owned by Mr. Daniel S. Loeb, the Chief Executive Officer of Third Point LLC, by virtue of such position. Third Point LLC and


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Mr. Loeb each disclaims beneficial ownership of such shares. The address of Third Point LLC is 390 Park Avenue, New York, NY 10022.
 
(3) In August 2010, Citadel issued nonvested shares of Class A common stock to certain members of its senior management and its board of directors pursuant to the Emergence Plan. In early November 2010, these members of Citadel’s senior management and its board of directors elected to voluntarily forfeit the shares of restricted stock granted by Citadel. On November 19, 2010, Citadel issued stock options, which are governed by the Citadel Plan, to certain members of its senior management and its board of directors as noted above. Each option is exercisable into one share of Class A common stock, and each holder’s options vest in three equal portions annually. The first tranche vested on June 3, 2011, and the remaining two tranches are scheduled to vest equally on each of June 3, 2012 and June 3, 2013. 75% of the options have a strike price of $28.00, 25% of the options have a strike price of $32.00 and all of the options expire on November 19, 2020.
 
(4) In May 2011, Citadel issued nonvested restricted shares of Class A common stock to certain members of its senior management. The nonvested restricted shares granted to Ms. Glassman vest in three equal installments on each of February 15, 2012, February 15, 2013 and February 15, 2014; provided, that, if the merger is consummated before February 15, 2014, half of the unvested restricted shares of common stock will vest upon the consummation of the merger and the remaining half of the unvested restricted shares of common stock will vest on the date that is six months following the date of the merger, in each case subject to Ms. Glassman’s continued employment on the applicable vesting date. The nonvested restricted shares granted to each of Ms. Ellis, Ms. Stratford and Mr. Taylor vest in full on May 26, 2013; provided, that, if the merger is consummated before May 26, 2013, half of the unvested restricted shares of common stock will vest upon the consummation of the merger and the remaining half of the unvested restricted shares of common stock will vest on the date that is six months following the date of the merger, in each case subject to such individual’s continued employment on the applicable vesting date.
 
Ownership of Citadel Class B common stock
 
The following table sets forth information regarding the beneficial ownership of Citadel Class B common stock. The table includes:
 
  •  each person or group who is known by Citadel to own beneficially more than 5% of Citadel’s Class B common stock;
 
  •  each of Citadel’s current directors and nominees for election as a director;
 
  •  each current executive officer of Citadel named in the summary compensation table in this information statement/proxy statement/prospectus and each other person who served as an executive officer in 2010; and
 
  •  all such Citadel directors and all executive officers as a group.
 
Beneficial ownership of shares is determined under rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power. Except as noted by footnote, and subject to community property laws where applicable, Citadel believes based on the information provided to it that the persons and entities named in the table below have sole voting and investment power with respect to all shares of Citadel’s Class B common stock shown as beneficially owned by them. The number of shares and the percentages of beneficial ownership of Citadel Class B common stock assume the exercise of all options, warrants (including Citadel special warrants) and other securities exchangeable or convertible for or exercisable into Citadel Class B common stock currently exercisable or exercisable within 60 days of June 29, 2011. The percentage of beneficial ownership of Citadel Class B common stock is based on 19,059,409 shares of Citadel Class B common stock outstanding as of June 29, 2011. Unless otherwise indicated, the address for


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each holder listed below is c/o Citadel Broadcasting Corporation, 7690 W. Cheyenne Avenue, Suite 220, Las Vegas, Nevada 89129.
 
                 
    Class B Common Stock Beneficially Owned  
    Number of
    Percentage of Class B
 
Name and Address:
  Class B Shares     Shares  
 
Pentwater Capital Management LP(1)
    1,780,000       9.34 %
Farid Suleman
    0       0 %
John L. Sander
    0       0 %
William M. Campbell, III
    0       0 %
Jonathan Mandel
    0       0 %
Gregory Mrva
    0       0 %
Doreen A. Wright
    0       0 %
Judith A. Ellis
    0       0 %
Jacquelyn J. Orr
    0       0 %
Randy L. Taylor
    0       0 %
Patricia Stratford
    0       0 %
Hilary E. Glassman
    0       0 %
All board members and executive officers as a group (11 persons)
    0       0 %
 
 
(1) Information obtained solely by reference to the Schedule 13G filed with the SEC on March 4, 2011 by Pentwater Capital Management LP. The address of Pentwater Capital Management LP is 227 West Monroe Suite 4000, Chicago, IL 60606. The number of shares and the percentages of beneficial ownership of Citadel Class B common stock assume the exercise of all options, warrants and other securities convertible into Citadel Class B common stock currently exercisable or exercisable within 60 days of June 29, 2011.
 
CITADEL SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
 
Section 16(a) of the Exchange Act requires Citadel’s executive officers and directors and persons who own more than 10% of the common stock of Citadel to file reports of ownership and changes in ownership of common stock of Citadel with the SEC. Based solely on a review of copies of such reports and written representations from the reporting persons, Citadel believes that during the year ended December 31, 2010, its executive officers, directors, and greater than 10% stockholders filed on a timely basis all reports due under Section 16(a) of the Exchange Act, except for the reports on Form 3 filed by Paul N. Saleh, William M. Campbell, III, John L. Sander, Jonathan Mandel, Gregory Mrva and Doreen A. Wright in connection with their appointment to Citadel’s board of directors.
 
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
AND DIRECTOR INDEPENDENCE OF CITADEL
 
Policies and Procedures for Review, Approval or Ratification of Related Transactions
 
Citadel’s directors, officers, employees, agents and representatives are expected to adhere to Citadel’s Code of Business Conduct and Ethics. In addition, Citadel’s Chief Executive Officer, President, Chief Operating Officer, Chief Financial Officer, Chief Accounting Officer, Senior Vice President of Finance & Administration, General Counsel and any other senior officers in such similar capacities are also expected to adhere to Citadel’s Supplemental Code of Ethics for Principal Executives and Senior Financial Officers. The Code of Business Conduct and Ethics and the Supplemental Code of Ethics for Principal Executives and Senior Financial Officers are available free of charge on Citadel’s website at http://www.citadelbroadcasting.com under “Investor Relations” where stockholders can click on the link to “Corporate Governance” and the “Code of Business Conduct and Ethics” and “Senior Officer Code of Ethics.”


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Any waiver of Citadel’s Code of Business Conduct and Ethics for executive officers or directors may be made only by Citadel’s board of directors and must be promptly disclosed to stockholders and others, as required by applicable law. Any transaction which involves an amount exceeding $120,000 and Citadel or its affiliates and one of Citadel’s executive officers or directors must be pre-approved by the audit committee. All related party transactions will be reviewed by the audit committee after the close of the fiscal quarter during which the transactions commenced.
 
Certain Relationships and Related Transactions
 
In June 2001, Citadel was capitalized by four partnerships affiliated with Forstmann Little & Co. (“FL&Co.”) and members of Citadel’s management to acquire Citadel Communications Corporation, which was then a publicly owned company. Citadel financed the acquisition by issuing its common stock to the Forstmann Little partnerships and members of management, by incurring indebtedness under a new credit facility and by issuing an aggregate of $500.0 million of subordinated debentures to two of the Forstmann Little partnerships. These partnerships immediately distributed the subordinated debentures to their respective limited partners. On February 18, 2004, Citadel prepaid all of the outstanding subordinated debentures with the net proceeds from the offering of 9,630,000 shares of common stock and the issuance of $330.0 million of convertible subordinated notes.
 
Since the merger involving Citadel, Alphabet Acquisition Corp. (a wholly-owned subsidiary of Citadel), The Walt Disney Company, and ABC Radio Holdings, Inc. (formerly known as ABC Chicago FM Radio, Inc.), a wholly-owned subsidiary of The Walt Disney Company, which became effective on June 12, 2007, neither FL&Co. nor any of its affiliated partnerships has any contractual right to designate a nominee for election to Citadel’s board of directors. In addition, Citadel is no longer obligated to solicit proxies in favor of any nominees recommended by FL&Co., nor must it take any action to cause any nominees recommended by FL&Co. to be elected.
 
Prior to Citadel’s emergence from the Chapter 11 Proceedings, Citadel was obligated to reimburse FL&Co. for expenses paid on Citadel’s behalf and receive reimbursements from FL&Co. for expenses paid by Citadel on FL&Co.’s behalf, including travel and related expenses, and office and other miscellaneous expenses. Since 2008, Citadel reimbursed FL&Co. and/or FL&Co. reimbursed Citadel less than $0.1 million annually.
 
Certain of Citadel’s former directors and current and former officers have or have had relationships with FL&Co. Theodore J. Forstmann, a former member of Citadel’s board of directors, is the senior partner of FL&Co. Two of Citadel’s other former directors, Mr. Forstmann’s brother, J. Anthony Forstmann, and Michael A. Miles are special limited partners of FL&Co. Mr. Miles also serves on the Forstmann Little advisory board and is an investor in certain portfolio companies of Forstmann Little. Another of Citadel’s former directors, Wayne T. Smith, is a limited partner of two of the funds that own shares of Citadel’s common stock. Mr. Smith also is a director of 24 Hour Fitness Worldwide, Inc., a majority of the stock of which is controlled by certain affiliated partnerships of FL&Co. As a result of their relationships with FL&Co., Messrs. Theodore J. Forstmann, J. Anthony Forstmann, Miles and Smith have an economic interest in certain of the Forstmann Little partnerships and their portfolio investments, including Citadel. However, only Mr. Theodore J. Forstmann has any voting or investment power over the shares of Citadel’s common stock, arising from his position as senior partner of FL&Co. Another former director, Herbert J. Siegel, serves as a director of IMG Worldwide, Inc., a majority of the stock of which is controlled by certain affiliated partnerships of FL&Co. As a result of these relationships, when conflicts between the interests of the Forstmann Little partnerships and the interests of Citadel’s other stockholders arise, these directors and officers may not be disinterested. Under Delaware law, although Citadel’s directors and officers have a duty of loyalty to Citadel, transactions that Citadel enters into in which a director or officer has a conflict of interest are generally permissible so long as the material facts as to the director’s or officer’s relationship or interest as to the transaction are disclosed to Citadel’s board of directors and a majority of Citadel’s disinterested directors approves the transaction, or the transaction is otherwise fair to Citadel.


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Employment Agreements
 
As required by the Emergence Plan on June 3, 2010, Citadel entered into employment agreements with each of Mr. Suleman, Mr. Taylor, Ms. Orr, Ms. Ellis and Ms. Stratford. On December 16, 2010, Citadel entered into a separation agreement with Ms. Orr pursuant to which she resigned from all positions with Citadel and its affiliates, effective as of January 31, 2011. The payments and other benefits provided for in the separation agreement are in full discharge of any and all liabilities and obligations of Citadel to Ms. Orr. For more information regarding these agreements, see “Citadel’s Compensation Discussion and Analysis — Summary of Citadel Employment Arrangements, Equity Arrangements and Potential Payments Upon Termination or Change in Control” on page        .
 
Director Independence
 
Prior to June 3, 2010, Citadel’s board of directors (the “Pre-Emergence Board of Directors”) consisted of J. Anthony Forstmann, Theodore J. Forstmann, Michael A. Miles, Michael J. Regan, Thomas V. Reifenheiser, Herbert J. Siegel, Wayne T. Smith and Farid Suleman. In assessing the independence of the directors in office prior to June 3, 2010, the board of directors affirmatively determined that both members of the nominating/corporate governance committee: Michael A. Miles and Herbert J. Siegel (who served through May 22, 2009); all members of the Audit Committee: Michael J. Regan, Thomas V. Reifenheiser, and Wayne T. Smith; and all three individuals who served on the compensation committee: Michael A. Miles, Herbert J. Siegel (who served through May 22, 2009) and Wayne T. Smith, each qualified as “independent” under the New York Stock Exchange (“NYSE”) and the SEC’s corporate governance rules, and that Citadel’s then-Chairman and Chief Executive Officer, Farid Suleman, did not qualify as “independent” under either set of rules.
 
In making its determination regarding the independence of each of those directors, Citadel’s Pre-Emergence Board of Directors considered each of the relationships identified under “— Certain Relationships and Related Transactions” on page        . With respect to each person identified as independent, the Pre-Emergence Board of Directors determined that those relationships did not affect the individual’s independence because, as applicable, he or she had not made any commitment to the affiliated partnerships of FL&Co. and none of the rights of an advisory board member or of a special limited partner or of service on the board of directors of a FL&Co. affiliate were contingent in any way on or affected by his or her service as a director or member of Citadel’s board of directors.
 
On June 3, 2010, the board of directors was reconstituted to consist of (i) Citadel’s Chief Executive Officer, Farid Suleman; (ii) William M. Campbell, III; (iii) Gregory Mrva; (iv) Paul N. Saleh; (v) Jonathan Mandel; (vi) John L. Sander; and (vii) Doreen A. Wright. Mr. Saleh subsequently resigned from the board of directors.
 
As part of the Emergence Plan, each of Citadel’s directors, other than its chief executive officer, was nominated by lenders representing 75% in amount of the senior claims bound under a plan support agreement, effective as of December 20, 2009. Each such nominee met with Citadel’s chief executive officer prior to his or her appointment to Citadel’s board of directors. Pursuant to the requirements of the Emergence Plan, each of Citadel’s directors, other than its chief executive officer, meets the independence standards set forth in the listing requirements of NYSE and the SEC’s corporate governance rules. Citadel’s Chief Executive Officer, Farid Suleman, does not qualify as “independent” under either set of requirements.
 
CITADEL CORPORATE GOVERNANCE
 
Citadel has taken the following measures to comply with the rules and regulations of the SEC regarding corporate governance practices:
 
  •  adopted governance guidelines for the board of directors;
 
  •  adopted procedures for Citadel’s non-management directors to meet in executive sessions;
 
  •  adopted a Code of Business Conduct and Ethics that is applicable to all of Citadel’s directors, officers, employees, agents and representatives;


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  •  adopted a Supplemental Code of Ethics for Principal Executives and Senior Financial Officers that is applicable to Citadel’s Chief Executive Officer, President, Chief Operating Officer, Chief Financial Officer, Chief Accounting Officer, Senior Vice President of Finance & Administration, General Counsel and any other senior officers in such similar capacities;
 
  •  adopted a policy on reporting of improper financial practices to address accounting or auditing concerns;
 
  •  adopted an audit committee charter, incorporating the applicable requirements of the Sarbanes-Oxley Act of 2002, as amended (“Sarbanes-Oxley”), SEC, and the related regulations;
 
  •  adopted a compensation committee charter, incorporating the applicable requirements of Sarbanes-Oxley, regulations of any applicable stock exchange, and related regulations;
 
  •  adopted a nominating/corporate governance committee charter, incorporating the applicable regulations of any applicable stock exchange, and related regulations; and
 
  •  adopted a Securities Trading Policy to ensure that persons subject to the reporting requirements of Section 16 of the Exchange Act will be able to comply with all applicable filing requirements in a timely manner.
 
Citadel’s Corporate Governance Guidelines, Code of Business Conduct and Ethics, Supplemental Code of Ethics for Principal Executive and Senior Financial Officers, nominating/corporate governance committee charter, audit committee charter and compensation committee charter are available on Citadel’s website at www.citadelbroadcasting.com under “Investor Relations” where stockholders can click on “Corporate Governance,” or upon the request of the stockholder by writing to Citadel’s Secretary at 7960 W. Cheyenne Avenue, Suite 220, Las Vegas, Nevada 89129. The information that appears on Citadel’s website is not part of, and is not incorporated into, this information statement/proxy statement/prospectus.
 
Any interested party that wishes to communicate directly with Citadel’s non-management directors may do so by writing to the following address:
 
Citadel Broadcasting Corporation
Attn: Non-Management Directors
7960 W. Cheyenne Avenue, Suite 220
Las Vegas, Nevada 89129
 
or by utilizing Citadel’s on-line service, Report-it, at http://www.reportit.net. Use “Citadel” as the user name and “Radio” as the password, and follow the instructions provided to create a report. Once submitted to the Report-it service, a copy of your report will be sent to a non-management member of the board of directors for review. All such communications are anonymous, unless you otherwise choose to use your name. The independent members of Citadel’s board of directors have instructed that communications will be distributed as appropriate to Citadel’s board of directors depending upon the facts and circumstances outlined in the communication.
 
Board Leadership Structure
 
Prior to June 3, 2010, Citadel’s Chief Executive Officer, Farid Suleman, also served as the Chairman of Citadel’s board of directors. Upon emergence from the Chapter 11 Proceedings, Citadel’s board of directors was reconstituted and John L. Sander was appointed as Chairman. Citadel’s Chief Executive Officer, Farid Suleman, continues to serve as a director.
 
Citadel’s board of directors believes that the combination of Mr. Suleman as Chief Executive Officer, together with Mr. Sander as Chairman, is currently the appropriate leadership structure for Citadel. The chief executive officer and the chairman provide leadership to the board of directors as a whole in setting its strategic priorities. In his position as chief executive officer, Mr. Suleman has primary responsibility for the day-to-day operations of Citadel and, accordingly, is able to effectively communicate the board of directors’ strategic findings and guidance to management. In his position as Chairman, Mr. Sander presides at all meetings of independent directors and acts as a liaison between the chief executive officer and the independent


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directors regarding the operations of Citadel and stockholder inquiries relating to the board of directors and management. At this time, Mr. Suleman is the sole member of the board of directors that is not independent.
 
While the initial decision to separate the chairmanship and chief executive officer positions was made in connection with the Emergence Plan, Citadel’s board of directors is comfortable with its existing leadership structure, given the supermajority of independent directors, a strong committee structure and the fact that Citadel’s chief executive officer does not serve on any board committees. Citadel’s board of directors reviews its leadership structure from time to time as appropriate.
 
Role of Board of Directors in the Oversight of Risk
 
Citadel’s board of directors believes an important part of its responsibilities is to oversee Citadel’s overall risk assessment processes and management thereof. Management periodically reports to the board of directors regarding various categories of business risks. Citadel’s board of directors also utilizes its committees to oversee specific risks and receives regular reports from the committees on the areas of risk for which they have oversight.
 
MEETINGS AND COMMITTEES OF CITADEL’S BOARD OF DIRECTORS
 
During the year ended December 31, 2010, there were a total of 16 meetings of Citadel’s board of directors, of which 12 were held after Citadel’s emergence from the Chapter 11 Proceedings with the newly appointed board of directors. Each member of Citadel’s board of directors attended at least 75% of all meetings of Citadel’s board of directors, and all committees of the board of directors on which he or she served during 2010.
 
During the year ended December 31, 2010, Citadel’s board of directors had three standing committees: the nominating/corporate governance committee, the audit committee and the compensation committee, and it did not have any other standing committees. During the year ended December 31, 2010, the nominating/corporate governance committee held 2 meetings, both of which were held after Citadel’s emergence from the Chapter 11 Proceedings, the audit committee held 4 meetings, of which 2 were held after Citadel’s emergence from the Chapter 11 Proceedings, and the compensation committee held 11 meetings, of which 10 were held after Citadel’s emergence from the Chapter 11 Proceedings.
 
Citadel does not have a policy regarding board members’ attendance at the Citadel annual meeting of stockholders but encourages attendance. Due to the Chapter 11 Proceedings, there was not an annual meeting of Citadel stockholders held in 2010.
 
Citadel’s Nominating/Corporate Governance Committee
 
The purpose and general duties of Citadel’s nominating/corporate governance committee are to assist Citadel’s board of directors in discharging its responsibilities to:
 
  •  identify criteria for selection of Citadel board members;
 
  •  find qualified individuals for membership on Citadel’s board of directors;
 
  •  recommend to Citadel’s board of directors nominees for the next annual meeting of Citadel stockholders;
 
  •  select and recommend candidates to fill any vacancies on Citadel’s board of directors;
 
  •  develop and recommend to the board of directors the Corporate Governance Guidelines for Citadel’s board of directors;
 
  •  provide oversight of Citadel’s and Citadel’s board of directors’ corporate governance affairs; and
 
  •  provide oversight of the evaluation of Citadel’s board of directors and management.


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Citadel’s nominating/corporate governance committee will identify candidates who are eligible under the qualification standards set forth in the Corporate Governance Guidelines to serve as members of Citadel’s board of directors and, after consultation with the Chairman of the board of directors, recommend candidates to be nominated by the board of directors for election by Citadel stockholders or to be appointed by the board of directors to fill vacancies. In evaluating a director in anticipation of nomination for reelection to Citadel’s board of directors, the committee’s reviews the qualifications and independence of the director. In recommending candidates for election to Citadel’s board of directors, the committee may consider the following criteria:
 
  •  experience in corporate or business management, such as serving as an officer or former officer of a publicly-held company;
 
  •  experience in the media, communication and/or radio broadcasting industries;
 
  •  experience as a board member of another publicly-held company;
 
  •  academic expertise in the media, communication and/or radio broadcasting industries or in specific areas of Citadel’s operations; and
 
  •  financial experience necessary to assist Citadel in meeting its corporate governance requirements.
 
As of December 31, 2010, the nominating/corporate governance committee consisted of William M. Campbell, III (Chairman), Gregory Mrva and Jonathan Mandel, each of whom is independent under NYSE rules and applicable SEC rules and regulations.
 
Stockholders may propose nominees for consideration by Citadel’s board of directors by submitting names and supporting information to the nominating/corporate governance committee. Citadel’s nominating/corporate governance committee will evaluate such nominees in the same manner it evaluates all nominees. In recommending candidates for election to the board of directors, Citadel’s nominating/corporate governance committee may consider the criteria outlined above as well as the diverse backgrounds of each of the candidates.
 
Citadel’s Audit Committee
 
Citadel’s audit committee is primarily responsible for oversight of the integrity of the financial reporting process and Citadel’s financial statements, including oversight of the financial statements and disclosure matters, Citadel’s relationship with its independent registered public accountants, Citadel’s internal audit function and compliance responsibilities. As part of these responsibilities, Citadel’s audit committee, among other things:
 
  •  appoints, retains and replaces Citadel’s independent registered public accountants;
 
  •  reviews the compensation of and services performed by Citadel’s independent registered public accountants, including non-audit services (if any);
 
  •  reviews and discusses the preparation of quarterly and annual financial reports with Citadel’s management and independent registered public accountants;
 
  •  discusses codification requirements with Citadel’s independent registered public accountants and the evaluation of their independence;
 
  •  reviews and discusses major issues regarding Citadel’s accounting principles, financial statement presentations, and the adequacy of Citadel’s internal controls with management and the independent registered public accountants;
 
  •  reviews and discusses the initial adoption of, and all significant changes to, critical accounting policies and practices used by Citadel with the independent registered public accountants;
 
  •  evaluates the qualifications, performance and independence of Citadel’s independent registered public accountants;


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  •  reviews the significant reports to management prepared by the internal auditing department and any management responses; and
 
  •  reviews reports and disclosures of insider and affiliated party transactions.
 
The members of Citadel’s audit committee as of December 31, 2010 were Gregory Mrva and William M. Campbell, III, each of whom is independent under NYSE rules and applicable SEC rules and regulations. Citadel’s board of directors has determined that Gregory Mrva is an “audit committee financial expert,” as defined by the SEC rules. Doreen Wright was appointed as a member of Citadel’s audit committee in March 2011. Prior to his resignation as of November 16, 2010, Paul N. Saleh served as Chairman of Citadel’s audit committee. Following Mr. Saleh’s resignation, Mr. Mrva served as interim Chairman and was then appointed Chairman in 2011.
 
Report of Citadel’s Audit Committee
 
Citadel’s audit committee reviewed and discussed with both management and its independent registered public accountants all financial statements, including any significant transactions or issues, prior to their filing with the SEC. In connection with Citadel’s December 31, 2010 financial statements, Citadel’s audit committee (i) reviewed and discussed the audited financial statements with management, including any significant transactions or issues; and (ii) discussed with the independent registered public accountants the matters required by SAS 61, as amended by the Public Company Accounting Oversight Board in Rule 3200T. Citadel’s audit committee also discussed with Deloitte & Touche LLP Deloitte & Touche LLP’s independence, including a consideration of the compatibility of non-audit services with such independence, and the letter from Deloitte & Touche LLP required by Public Company Accounting Oversight Board Rule 3526, Communication with Audit Committees Concerning Independence. Based upon these reviews and discussions, Citadel’s audit committee recommended that Citadel’s board of directors include the audited financial statements in Citadel’s Annual Report filed with the SEC on Form 10-K for the fiscal year ended December 31, 2010.
 
     
Submitted by:
  Gregory Mrva (Chairperson)
William M. Campbell, III
Doreen Wright
 
Citadel’s Compensation Committee
 
Citadel’s compensation committee is responsible for discharging the board of directors’ duties and responsibilities relating to the compensation of Citadel’s directors and executive officers and overseeing Citadel’s various employee welfare and benefits plans. These duties include:
 
  •  discussing, reviewing and determining the compensation of Citadel’s chief executive officer and other senior executives;
 
  •  reviewing and recommending Citadel’s compensation plans;
 
  •  modifying Citadel’s existing compensation plans;
 
  •  making awards under Citadel’s compensation plans; and
 
  •  performing such other functions as are designated in Citadel’s compensation committee charter or commonly performed by compensation committees.
 
The compensation arrangements for 2010 for Citadel’s named executive officers, the process for structuring and paying compensation to Citadel’s named executive officers for 2010 and the goals, purposes and intentions of the 2010 compensation arrangements for Citadel’s named executives were largely administered in accordance with the Emergence Plan. The role of the compensation committee and Citadel’s processes and procedures relative to the determination of executive compensation is discussed further under “Citadel’s Compensation Discussion and Analysis” on page   .


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The members of Citadel’s compensation committee as of December 31, 2010 were Doreen A. Wright (Chairperson), Jonathan Mandel and John L. Sander each of whom is independent under NYSE rules and applicable SEC rules and regulations.
 
Citadel’s compensation committee has retained a third party firm, Towers Watson, as its compensation consultant to provide advice that will assist in the continual development and evaluation of compensation policies and the compensation committee’s determinations of compensation awards. The role of the outside consultant is to provide independent, third-party advice and expertise in executive compensation issues. The outside consultant, however, is not consulted by the compensation committee on all executive compensation issues, but is consulted as the compensation committee deems appropriate in its business judgment. In addition, Towers Watson provided some additional valuation related services to Citadel during the year ended December 31, 2010.
 
In addition, Citadel’s compensation committee has appointed Loeb & Loeb LLP to act as its legal advisor. The role of the outside legal advisor is to provide legal advice and expertise on various legal issues. The outside legal advisor, however, is not consulted by the compensation committee on all legal issues, but is consulted as the compensation committee deems appropriate in its business judgment. Loeb & Loeb did not provide any additional services to Citadel or its affiliates during the year ended December 31, 2010 other than serving as legal advisor to the independent members of the board of directors.
 
Compensation Committee Interlocks and Insider Participation
 
None of the members of Citadel’s compensation committee in place prior to Citadel’s emergence from the Chapter 11 Proceedings or its compensation committee in place as of December 31, 2010 is or has been an officer or employee of Citadel, and none of Citadel’s executive officers has served on the compensation committee or board of any entity that employed any member of Citadel’s pre-emergence or post-emergence compensation committees or the board of directors.
 
Compensation Committee Report
 
Citadel’s compensation committee has reviewed and discussed Citadel’s Compensation Discussion and Analysis contained in this information statement/proxy statement/prospectus with Citadel’s management. Based on its review and discussion with management, the compensation committee has recommended to the board of directors that Citadel’s Compensation Discussion and Analysis be included in Citadel’s Annual Report on Form 10-K for the year ended December 31, 2010 and this information statement/proxy statement/prospectus.
 
     
Submitted by:
  Doreen A. Wright (Chairperson)
Jonathan Mandel
John L. Sander
 
The Code of Business Conduct and Ethics and the Supplemental Code of Ethics for Principal Executives and Senior Financial Officers
 
On May 3, 2011, Citadel adopted and implemented the Citadel Broadcasting Corporation Code of Business Conduct and Ethics, which replaces its prior code of business conduct and ethics. The Code of Business Conduct and Ethics applies to all directors, officers, employees, agents and representatives of Citadel. It establishes the principles and policies for professional behavior in the workplace. On May 3, 2011, Citadel also adopted the Supplemental Code of Ethics for Principal Executives and Senior Financial Officers, which replaced its prior supplemental code of ethics for principal executives and senior financial officers. The Supplemental Code applies to the Chief Executive Officer, President, Chief Operating Officer, Chief Financial Officer, Chief Accounting Officer, Senior Vice President of Finance & Administration, General Counsel and any other senior officers in such similar capacities. The Supplemental Code of Ethics for Principal Executives and Senior Financial Officers is intended to supplement Citadel’s Code of Business Conduct and Ethics,


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establishing additional requirements and standards applicable to principal executives and senior financial officers.
 
A summary of the revisions reflected in the May 3, 2011 Code of Business Conduct and Ethics and Supplemental Code of Ethics for Principal Executives and Senior Financial Officers can be found on Citadel’s website at http://www.citadelbroadcasting.com under “Investor Relations” where stockholders can click on the link to “Corporate Governance” and the “Updates to Code of Business Conduct and Ethics and Senior Officer Code of Ethics.”
 
Citadel will disclose any future amendments to, or waivers from, provisions of the codes, its committee charters and its policies and standards on its website as promptly as practicable, as may be required under applicable SEC rules.
 
CITADEL’S COMPENSATION DISCUSSION AND ANALYSIS
 
For 2010, Citadel’s named executive officers were:
 
  •  Farid Suleman, Chief Executive Officer
 
  •  Judith A. Ellis, Chief Operating Officer
 
  •  Randy L. Taylor, Senior Vice President and Chief Financial Officer
 
  •  Patricia Stratford, Senior Vice President — Finance and Administration and Assistant Secretary; and
 
  •  Jacquelyn J. Orr, Vice President, General Counsel and Secretary
 
On December 16, 2010, Citadel entered into a separation agreement with Ms. Orr pursuant to which she resigned from all positions with Citadel and its affiliates, effective as of January 31, 2011. For a description of the separation, see “— Summary of Citadel Employment Arrangements, Equity Arrangements and Potential Payments Upon Termination or Change in Control — Other Named Executive Officers’ Employment Arrangements” on page   .
 
2010 Background
 
As part of the Chapter 11 Proceedings, Citadel entered into new employment and incentive arrangements with its named executive officers. The agreements implementing these arrangements were filed with the Bankruptcy Court and became part of Citadel’s Emergence Plan. Neither Citadel’s pre-emergence compensation committee nor the Pre-Emergence Board of Directors participated in any material manner in these negotiations because the representatives of Citadel’s future equity holders wished to negotiate these arrangements directly with Citadel’s named executive officers. While the pre-emergence compensation committee and Pre-Emergence Board of Directors formally approved these arrangements in connection with their overall approval of the Emergence Plan, such approvals were procedural in nature.
 
All of the 2010 compensation arrangements for Citadel’s named executive officers were structured and implemented pursuant to the agreements that were part of the Emergence Plan (the “2010 Employment Agreements”). The process for structuring and paying compensation to Citadel’s named executive officers for 2010 and the goals, purposes and intentions of the 2010 compensation arrangements for Citadel’s named executives were also largely administered in accordance with the Emergence Plan. In addition, the Citadel Broadcasting Corporation Supplemental Executive Retirement Plan (the “SERP”) for Mr. Suleman was implemented pursuant to his 2010 Employment Agreement. See “— Summary of Citadel Employment Arrangements, Equity Arrangements and Potential Payments Upon Termination or Change in Control” on page    and “— Equity Compensation Plans In Effect Following the Emergence Date — 2010 Equity Incentive Plan” on page    for a description of the material terms of the 2010 Employment Agreements and the Citadel Plan as approved by the Bankruptcy Court. As a result, the ability of the compensation committee to independently review and/or establish compensation arrangements for Citadel’s named executive officers in 2010 was sharply reduced or eliminated.


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Accordingly, this Compensation, Discussion and Analysis describes the 2010 compensation arrangements for Citadel’s named executive officers, but is necessarily limited by the fact that virtually all of the arrangements were structured and implemented in connection with the Emergence Plan. The 2010 Employment Agreements also contain provisions relating to the compensation of Citadel’s named executive officers through the year ending December 31, 2012, including minimum base salary and performance objectives that will limit, to a certain extent, the role of Citadel’s compensation committee during the next several years.
 
Executive Compensation Program’s Philosophy and Objectives for 2010
 
After June 3, 2010, the philosophy and objectives of Citadel’s executive compensation program were to execute and implement the 2010 Employment Agreements. As noted in more detail below, these contractual arrangements specify virtually all aspects of the 2010 compensation for Citadel’s named executive officers and left little discretion to the compensation committee to implement a program that achieves a compensation philosophy or objectives independently established by the compensation committee.
 
Once Citadel’s compensation committee determines it has discretion to implement an executive compensation program, it expects to formulate a program that would seek to closely align compensation paid to Citadel’s named executive officers with Citadel’s performance on both a short-term and long-term basis and to use compensation to assist Citadel in attracting, motivating and retaining key executives critical to its long-term success, and which is performance-based and competitive with the various labor markets and industries in which Citadel competes for talent.
 
What the Executive Compensation Program Was Designed to Reward
 
As noted above, Citadel’s 2010 compensation program was designed to reward Citadel’s named executive officers for achieving the goals and metrics determined in connection with the Emergence Plan. In subsequent years, Citadel’s compensation program will seek to align Citadel’s named executive officers’ incentives with stockholder value creation by rewarding the achievement of measurable corporate and individual performance objectives through annual and long-term cash and equity incentives.
 
How Citadel Structures a Named Executive Officer’s Total Compensation
 
Role of the Compensation Committee, Named Executive Officers and Outside Advisors
 
As a general matter, Citadel’s compensation committee is appointed by Citadel’s board of directors to discharge the board’s duties and responsibilities relating to the compensation of Citadel’s directors and executive officers and oversee Citadel’s various employee welfare and benefits plans, including to discuss, review and determine the compensation of Citadel’s chief executive officer and other senior executives; to review and recommend Citadel’s compensation plans; to modify existing compensation plans; to make awards under such plans and to perform such other functions as are designated in the compensation committee charter or commonly performed by compensation committees. Under its charter, the compensation committee meets at such times as it deems necessary to fulfill its responsibilities, has the resources and authority necessary and appropriate to discharge its responsibilities, including the authority to retain compensation consultants and other experts, and has the sole authority to approve the fees and other terms of retention of such consultants or other experts. Additionally, the compensation committee may delegate authority to act upon specific matters within determined parameters to one or more members of the board of directors and/or officers of Citadel, consistent with the Citadel Bylaws, the Citadel Charter and the Citadel Plan and applicable law, and any such person or group must report any action to the full compensation committee at its next meeting.
 
Citadel’s compensation committee typically approves all compensation and awards to Citadel’s named executive officers. Generally, on its own initiative, the compensation committee reviews the performance and compensation of the chief executive officer, chief operating officer and chief financial officer and, following discussions of those individuals and on the recommendation of Mr. Suleman (except in the case of his own compensation), and, where it deems appropriate, with an outside advisor, establishes their compensation levels. For the remaining named executive officers, Citadel’s chief executive officer makes recommendations to the


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compensation committee that the compensation committee will generally approve, with minor adjustments, after it conducts its own independent review.
 
Citadel’s compensation committee has retained a third party firm, Towers Watson, as its compensation consultant to provide advice that will assist in the continual development and evaluation of compensation plans, policies and the compensation committee’s determinations of compensation awards. The role of the outside consultant is to provide independent, third-party advice and expertise in executive compensation issues. The outside consultant, however, is not consulted by the compensation committee on all executive compensation issues, but is consulted as the compensation committee deems appropriate in its business judgment.
 
In addition, Citadel’s compensation committee has appointed Loeb & Loeb LLP to act as its legal advisor. The role of the outside legal advisor is to provide legal advice and expertise on various legal issues. The outside legal advisor, however, is not consulted by the compensation committee on all legal issues, but is consulted as the compensation committee deems appropriate in its business judgment. Loeb & Loeb LLP also acts as counsel to the independent members of the board of directors.
 
With respect to compensation decisions made in 2010, however, Citadel’s compensation committee believed that it was required to implement the 2010 Employment Agreements and related compensation matters that were approved by the Bankruptcy Court in connection with Citadel’s emergence from the Chapter 11 Proceedings. Accordingly, for 2010, the compensation committee believed its role was to review and understand these arrangements and implement them in accordance with their terms.
 
Elements of Compensation, Why Citadel Chooses to Pay Each Element and Its 2010 Practices
 
The compensation for Citadel’s named executive officers for 2010 consisted of a base salary, an annual cash bonus, long-term equity awards in the form of stock options, miscellaneous welfare and other employee benefits and, in the case of Citadel’s chief executive officer, a supplemental retirement benefit. As noted above, the specific terms of each named executive officer’s compensation in 2010 were governed by the applicable 2010 Employment Agreement. The 2010 compensation arrangements for Citadel’s named executive officers were structured and implemented pursuant to the agreements negotiated in connection with the Emergence Plan.
 
Base Salary for Citadel’s Named Executive Officers
 
Purpose.  In general, the level of base salary is intended to provide appropriate base pay to Citadel’s named executive officers, taking into account the competitive employment market for comparable positions, as well as each individual’s job responsibilities, experience, historical contribution to Citadel’s success and unique value and, when appropriate, the recommendations of Citadel’s chief executive officer (except in the case of his own compensation).
 
Calendar Year 2010 Decisions.  For 2010, the base salaries for Citadel’s named executive officers were paid in two distinct time periods. Prior to Citadel’s emergence from the Chapter 11 Proceedings, Citadel’s named executive officers were paid a base salary established by the pre-emergence compensation committee. The pre-emergence level of base salary for each of Citadel’s named executive officers reflected a previously agreed upon voluntary 10% salary reduction for its chief executive officer and 5% salary reduction for each other named executive officer. In light of the Chapter 11 Proceedings, the pre-emergence compensation committee did not deem it necessary or appropriate to increase or decrease base salary levels during the Chapter 11 Proceedings.


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After June 3, 2010, each of Citadel’s named executive officers was paid the base salary set forth in his or her 2010 Employment Agreement. Set forth below is a chart showing the pre- and post-emergence annualized base salary levels of each of Citadel’s named executive officers.
 
                 
    Pre-Emergence Annualized Base
  Post-Emergence
    Salary Level (Reflects Voluntary
  Annualized Base Salary
    Reduction by Executive)   Level
 
F. Suleman — Chief Executive Officer
  $ 1,125,000     $ 1,250,000  
R. Taylor — Chief Financial Officer
  $ 380,000     $ 400,000  
J. Ellis — Chief Operating Officer
  $ 475,000     $ 500,000  
P. Stratford — SVP — Finance and Administration
  $ 190,000     $ 200,000  
J. Orr — General Counsel, VP and Secretary
  $ 332,500     $ 350,000  
 
Considerations.  Prior to Citadel’s emergence from the Chapter 11 Proceedings, the salaries for Citadel’s named executive officers, where not specified by contract, were determined by the pre-emergence compensation committee based on a variety of factors, including: the competitive employment market for comparable positions, as well as each individual’s job responsibilities, experience, historical contribution to Citadel’s success and unique value and the recommendations of its chief executive officer (except in the case of his own compensation). After June 3, 2010, each of Citadel’s named executive officers was paid the base salary set forth in his or her 2010 Employment Agreement. The 2010 compensation arrangements for Citadel’s named executive officers were structured and implemented pursuant to the agreements negotiated in connection with the Bankruptcy Court-approved Emergence Plan and specified the base salaries of Citadel’s named executive officers during the term of the 2010 Employment Agreements. As long as the compensation arrangements for Citadel’s named executive officers are governed by the 2010 Employment Agreements, the base salaries for its named executive officers cannot be lower than the amounts summarized in the table above. Beginning in 2011, Citadel will review the base salaries of its named executive officers and, consistent with the terms of the 2010 Employment Agreements, will be entitled to increase such salaries in its discretion, after considering the factors noted above, among others it deems appropriate. In February 2011, the compensation committee determined not to increase the base salary of any named executive officer at that time, but to consider base salary increases at a later meeting if deemed appropriate.
 
Annual Bonus Incentives for Citadel’s Named Executive Officers
 
Purpose.  Citadel’s compensation program for its named executive officers generally provides for an annual bonus that is linked to achievement of Citadel’s established performance goals and is also designed to reward performance of objectives and accomplishments of its named executive officers beyond purely financial measures. The objective of the program is to create incentives for Citadel’s named executive officers to excel in the performance of their functional responsibilities and to contribute generally to Citadel’s overall success.
 
Calendar Year 2010 Decisions.  The target bonus levels for each of Citadel’s named executive officers and the performance criteria required to be achieved to earn an annual bonus for 2010 are set forth in each named executive officer’s 2010 Employment Agreement. Set forth below is a chart showing the applicable target bonus and 2010 performance criteria for each of Citadel’s named executive officers.
 
             
    Target Bonus  
Performance Criteria
 
F. Suleman — Chief Executive Officer
  $ 2,000,000     $232.4 million of consolidated EBITDA
R. Taylor — Chief Financial Officer
  $ 200,000 (1)   $232.4 million of consolidated EBITDA
J. Ellis — Chief Operating Officer
  $ 200,000     $232.4 million of consolidated EBITDA
P. Stratford — SVP — Finance and Administration
  $ 125,000     $232.4 million of consolidated EBITDA
J. Orr — General Counsel, VP and Secretary
  $ 200,000 (1)   $232.4 million of consolidated EBITDA
 
 
(1) In addition, the pre-emergence compensation committee agreed to an additional bankruptcy emergence bonus of $150,000 for both Mr. Taylor and Ms. Orr, paid upon Citadel’s emergence from the Chapter 11 Proceedings.


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For purposes of determining satisfaction of the above performance criteria, EBITDA is calculated on a consolidated basis in a manner consistent with Citadel’s internal accounting procedures and adjusted to exclude the effects of acquisitions and dispositions and restructuring or reorganization costs related to any bankruptcy proceedings. Pursuant to the terms of each 2010 Employment Agreement, actual bonus awards for the year ended December 31, 2010 were determined and paid. At a meeting in February 2011, the compensation committee determined to approve additional cash incentive compensation of $50,000 for both Ms. Ellis and Mr. Taylor and $25,000 for Ms. Stratford. At his own suggestion, Mr. Suleman was not considered for an increased bonus opportunity. Pursuant to the separation agreement, Ms. Orr received a lump sum payment equal to $200,000 on January 31, 2011, representing a payment with respect to Ms. Orr’s bonus for 2010.
 
Considerations.  The 2010 compensation arrangements for Citadel’s named executive officers were structured and implemented pursuant to the 2010 Employment Agreements negotiated in connection with the Emergence Plan. The 2010 Employment Agreements specify the method for determining the bonuses for Citadel’s named executive officers through 2012. During this period, the compensation committee retains discretion to increase target bonus levels for each named executive officer, but may not lower target bonus levels below the 2010 levels.
 
Long-Term Incentive Compensation
 
For a description of the Citadel Plan, please see “— Equity Compensation Plans In Effect Following the Emergence Date — 2010 Equity Incentive Plan” on page   .
 
Purpose.  Citadel’s compensation program for its named executive officers generally provides for the grant of incentive awards designed to compensate and reward executives over a multi-year period. These incentive awards typically take the form of equity-related awards with specified, multi-year vesting conditions. To realize any value, these awards require Citadel’s named executive officers to satisfy the specified vesting conditions. In addition, since these awards are typically tied to the value of Citadel’s common stock, the economic interests of Citadel’s named executive officers are subject to the same fluctuations as are stockholders, thus aligning the interests of Citadel’s named executive officers and stockholders.
 
Calendar Year 2010 Decisions.  The 2010 Employment Agreements required Citadel to grant its named executive officers “stock appreciation rights,” pursuant to a form of award agreement that had been negotiated in connection with the Bankruptcy Court-approved Emergence Plan, which generally provide for ratable vesting over a three year period if the named executive officer remains employed by Citadel. After June 3, 2010, Citadel’s compensation committee reviewed these long-term incentive arrangements and determined that Citadel’s interests would be better served by granting its named executive officers “restricted shares” of its common stock under the terms of the Citadel Plan (i.e., shares of common stock subject to forfeiture if specified vesting conditions were not achieved) in lieu of stock appreciation rights. In response to a lawsuit filed by one of Citadel’s stockholders claiming that Citadel’s compensation committee lacked the authority to alter the long-term compensation arrangements previously negotiated in connection with the Bankruptcy Court-approved Emergence Plan, these restricted stock grants were voluntarily forfeited by the officers and directors and were rescinded by Citadel. Thereafter, in November 2010, Citadel instead granted its officers and directors options to purchase stock, the terms of which were governed by the parameters previously negotiated in connection with the Bankruptcy Court-approved Emergence Plan. On November 19, 2010, Citadel, upon the recommendation of the compensation committee with the approval of the board of directors (other than Mr. Suleman), issued a total of 3,266,629 options to purchase common stock to its directors and named executive officers, 75% of which had an exercise price equal to $28.00 per share and the remaining 25% of which had an exercise price equal to $32.00 per share. The fair value of Citadel’s Class A common stock on the grant date was $25.00 per share. The options issued to Citadel’s named executive officers and directors vest in three equal portions annually. The first tranche vested on June 3, 2011, and the remaining two tranches are scheduled to vest equally on each of June 3, 2012 and June 3, 2013. Upon certain events related to the termination of employment of Citadel’s named executive officers, termination of service of Citadel’s directors or the change in control of Citadel, the options vest in full as more fully described in “— Summary of Citadel


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Employment Arrangements, Equity Arrangements and Potential Payments Upon Termination or Change in Control — Equity Arrangements” on page    and “— Compensation of Post-Emergence Board of Directors.”
 
Calendar Year 2011 Awards.  On May 26, 2011, each of the named executive officers (other than Mr. Suleman and Ms. Orr) along with Hilary Glassman (Citadel’s new General Counsel, Senior Vice President) received grants of restricted stock under the Citadel Plan in the following amounts in accordance with the terms of the merger agreement, (i) Mr. Taylor received a grant of 14,000 shares of restricted stock, (ii) Ms. Ellis received a grant of 23,000 shares of restricted stock, (iii) Ms. Stratford received a grant of 13,000 shares of restricted stock and (iv) Ms. Glassman received a grant of 10,000 shares of restricted stock. Each restricted stock award, other than the award granted to Ms. Glassman, vests in full on May 26, 2013, provided that if the merger is consummated, half of the unvested portion of the award will vest upon the consummation of the merger and the remainder will vest on the date that is six months following the date the merger is consummated. The restricted stock award granted to Ms. Glassman vests in three equal annual installments beginning on February 15, 2012, provided that if the merger is consummated, half of the unvested portion of the award will vest upon the consummation of the merger and the remainder will vest on the date that is six months following the date the merger is consummated. In addition, pursuant to the terms of the awards, the Citadel Plan and the merger agreement, if applicable, each restricted stock award will vest in full upon specified terminations of employment of such executive officer. The restricted stock awards entered into with Ms. Ellis and Ms. Stratford contain provisions providing that if any payment, distribution or benefit to Ms. Ellis or Ms. Stratford, whether pursuant to the restricted stock award or otherwise would result in excise taxes imposed on the executive officer under Section 4999 of the Code, then any payment, distribution or benefit provided pursuant to the restricted stock agreement will be reduced in order to avoid the imposition of such excise taxes solely to the extent such a reduction puts the executive officer in a more favorable after-tax position than if no such reduction had occurred.
 
Considerations.  In the future, the compensation committee expects to determine the number of incentive awards granted to Citadel’s named executive officers on an individual, discretionary basis. The compensation committee believes the level of long-term incentive compensation generally should be determined based on any contractual requirements (such as pursuant to an existing employment agreement); total compensation provided to named executive officers; the goals of the compensation program described above; discussions with outside advisors; market data on total compensation packages; the value of long-term incentive grants at targeted external companies; total stockholder return; share usage and stockholder dilution; and, except in the case of the awards to Mr. Suleman, the recommendations of Mr. Suleman. The compensation committee has discretion to reduce the amount of any future incentive compensation on the basis of individual or companywide performance, and to claw back any incentive compensation paid if it is determined that such payments were based on materially inaccurate financial statements or any other materially inaccurate performance metric criteria.
 
Benefits and Perquisites
 
Citadel provides named executive officers with perquisites and other benefits that Citadel’s board of directors and compensation committee believe are reasonable and consistent with the overall executive compensation program to better enable Citadel to attract and retain superior employees for key positions. The compensation committee periodically reviews the level of perquisites and other personal benefits provided to named executive officers. With limited exceptions, named executive officers receive perquisites and benefits that are substantially the same as those offered to Citadel’s other officers. Citadel may also make available to Mr. Suleman use of a private aircraft for business purposes. Mr. Suleman and Ms. Ellis are provided with use of company vehicles and/or parking for business use, Mr. Taylor is provided with parking for business purposes, and Mr. Suleman is also provided with use of a driver for business purposes.
 
Named executive officers also participate in Citadel’s other benefit plans on the same terms as Citadel’s other employees. These plans include medical, vision and dental insurance, life and disability insurance, and flexible spending accounts relating to health care and dependents. Named executive officers participate in Citadel’s 401(k) retirement savings plan and on a case-by-case basis are reimbursed for work-related


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transportation costs. For additional information on the benefits and/or perquisites available to named executive officers, see the text following the 2010 Summary Compensation Table below.
 
Severance, Retirement and Change in Control Benefits
 
Each of the 2010 Employment Agreements specifies severance and/or change in control benefits. In addition, the 2010 Employment Agreement for Citadel’s chief executive officer provides for a supplemental retirement benefit. Citadel adopted the SERP that satisfies its obligations under its chief executive officer’s 2010 Employment Agreement. For a description of Mr. Suleman’s SERP, see “— Summary of Citadel Employment Arrangements, Equity Arrangements and Potential Payments Upon Termination or Change in Control — Mr. Suleman’s Employment Arrangements” on page   .
 
On December 16, 2010, Citadel entered into a separation agreement with Jacquelyn J. Orr, Citadel’s General Counsel, Vice President and Secretary, pursuant to which she agreed to resign from all positions with Citadel and its affiliates, effective as of January 31, 2011. In consideration for a release of claims from Ms. Orr and Ms. Orr’s continued agreement to confidentiality, non-disclosure and non-solicitation covenants, Citadel has paid Ms. Orr (i) a lump sum payment equal to $550,000 on December 31, 2010 and (ii) a lump sum payment equal to $200,000 on January 31, 2011, representing a payment with respect to Ms. Orr’s bonus for 2010. In addition, Ms. Orr and her dependents are eligible to continue to participate in Citadel’s medical, dental and vision plans through January 31, 2012 at Citadel’s expense. The payments and other benefits provided for in the separation agreement are in full discharge of any and all liabilities and obligations of Citadel to Ms. Orr. Pursuant to the separation agreement, Ms. Orr was entitled to continue to receive her base salary at the then current rate (i.e., $350,000) as well as the employee benefits provided by her employment agreement, until January 31, 2011.
 
Policy Regarding Citadel’s Tax Deduction
 
Citadel typically seeks to structure its compensation programs such that compensation paid thereunder will be tax deductible by Citadel to the maximum extent possible. Section 162(m) of the Code limits Citadel’s ability to deduct for tax purposes compensation in excess of $1.0 million that is paid to its principal executive officer or any one of its three highest paid executive officers, other than its principal executive officer or principal financial officer, who are employed by Citadel on the last day of its taxable year. However, the statute exempts qualifying performance-based compensation from the deduction limit if certain requirements are met and also provides “grandfathering rules” for compensation paid pursuant to certain plans. Citadel’s compensation committee believes, however, that stockholder interests are best served by not restricting the compensation committee’s discretion and flexibility in crafting compensation programs and in making certain compensation awards, even though such programs or awards may result in certain non-deductible compensation expenses.


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2010 Summary Compensation Table
 
The total compensation earned by each of Citadel’s named executive officers for the fiscal year ended December 31, 2010, is presented below on a combined basis, by adding the total compensation of such named executive officer for the period from January 1, 2010 through May 31, 2010, which is referred to as the Predecessor period, and the period from June 1, 2010 through December 31, 2010, which is referred to as the Successor period.
 
                                                         
                Stock
  Option
  All Other
   
            Bonus
  Awards
  Awards
  Compensation
   
Name and Principal Position
  Year   Salary ($)   ($)   ($)(1)   ($)(1)   ($)   Total ($)
 
Farid Suleman,
    2010       1,186,955       2,000,000       (2)     27,446,064 (3)     2,554 (4)     30,635,573 (5)
chief executive officer
    2009       1,135,417       2,000,000 (6)                 90 (7)     3,135,507  
(principal executive officer)
    2008       1,250,000             4,819,642 (8)           12,248 (9)     6,081,890  
Judith A. Ellis,
    2010       489,391       250,000 (10)     (2)     1,443,734 (11)     2,554 (4)     2,185,679 (5)
chief operating officer
    2009       477,084       200,000 (6)                 90 (7)     677,174  
      2008       500,000       100,000       152,500 (12)           2,340 (13)     754,840  
Jacquelyn J. Orr,(14)
    2010       342,574       350,000 (22)     (2)     1,154,993 (15)     550,104 (16)(14)     2,397,671 (5)
vice president, general
    2009       324,948       200,000 (6)                 90 (7)     525,038  
counsel and secretary
    2008       315,625       56,250 (17)     42,700 (18)           2,340 (13)     416,915  
Patricia Stratford,
    2010       195,756       150,000 (10)     (2)     812,102 (19)     2,554 (4)     1,160,412 (5)
senior vice president —
    2009       190,833       125,000 (6)                 90 (7)     315,923  
finance and administration
    2008       193,750             42,700 (18)           2,340 (13)     238,790  
Randy L. Taylor,(20)
    2010       385,179       400,000 (10)(22)     (2)     1,154,993 (15)     2,554 (4)     1,942,726 (5)
senior vice president —
    2009       337,000       200,000 (6)                 90 (7)     537,090  
finance and chief financial officer
    2008       306,667             73,200 (21)           2,340 (13)     382,207  
 
 
(1) The amounts reported in these columns for each named executive officer reflect the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. See option grants detailed in the Grants of Plan-Based Awards Table.
 
(2) In August 2010, in connection with Citadel’s emergence from the Chapter 11 Proceedings, each named executive officer was awarded shares of unvested restricted stock as summarized in the table below. These awards were subsequently forfeited and such awards were rescinded by Citadel in November 2010 and accordingly are not included in the total compensation for 2010.
 
                         
        Grant Date
    Shares   Stock Price   Fair Value
 
Farid Suleman
    1,901,042     $ 23.00     $ 43,723,966  
Judith A. Ellis
    100,000       23.00       2,300,000  
Jacquelyn J. Orr
    80,000       23.00       1,840,000  
Patricia Stratford
    56,250       23.00       1,293,750  
Randy L. Taylor
    80,000       23.00       1,840,000  
 
(3) Option award compensation is based on 2,529,591 options granted on November 19, 2010, of which 75% have an exercise price of $28.00 and a grant date fair value of $11.08 per option and 25% have an exercise price of $32.00 and a grant date fair value of $10.16 per option.
 
(4) Included in other compensation is $2,450 for matching contributions to the Citadel Broadcasting Company 401(k) Retirement Savings Plan and $104 in premiums for term life insurance.
 
(5) Does not reflect the grant date fair value of the unvested restricted stock voluntarily forfeited by each named executive officer, as disclosed in footnote (2) above.
 
(6) The Bankruptcy Court approved the payment of the following 2009 bonuses in 2010: $2.0 million to Mr. Suleman; $200,000 to Ms. Ellis; $200,000 to Mr. Taylor; $200,000 to Ms. Orr; and $125,000 to Ms. Stratford.
 
(7) Included in all other compensation is $90 premium for term life insurance.
 
(8) Stock award compensation of $4,819,642 is comprised of $3,440,000 related to 2,000,000 shares of restricted stock with solely time-based vesting conditions and $1,379,642 related to 2,000,000 shares of


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restricted stock with both performance-based and time-based vesting conditions. Effective April 1, 2009, Mr. Suleman voluntarily cancelled both (i) the 2,000,000 shares of restricted stock with time-based vesting conditions and (ii) the 2,000,000 shares of restricted stock with performance-based and time-based vesting conditions. Therefore, the equity compensation of $4,819,642 reflected above under “stock award” was not received by Mr. Suleman. Thus, excluding these equity grants, the actual compensation received by Mr. Suleman for 2008 was $1,262,248.
 
(9) Included in all other compensation is $9,908 representing the value of personal benefit of use of the corporate aircraft, $2,250 for matching contributions to the Citadel Broadcasting Company 401(k) Retirement Savings Plan and $90 premium for term life insurance.
 
(10) Includes an additional $50,000, $50,000 and $25,000 bonus above the contractual minimums for Mr. Taylor, Ms. Ellis and Ms. Stratford, respectively, in recognition of their efforts both pre- and post-bankruptcy during 2010.
 
(11) Option award compensation is based on 133,063 options granted on November 19, 2010 at a closing stock price of $25.00, of which 75% have an exercise price of $28.00 and a grant date fair value of $11.08 per option and 25% have an exercise price of $32.00 and a grant date fair value of $10.16 per option.
 
(12) Stock award compensation is related to 125,000 shares of restricted stock granted on June 27, 2008 at a closing stock price of $1.22 with performance-based vesting conditions. However, in November 2009, Ms. Ellis voluntarily cancelled 41,667 shares that were scheduled to vest during 2009. Therefore, $50,834 of equity compensation related to the cancelled shares that is reflected in the $152,500 above under “stock award” was not received by Ms. Ellis. Excluding the compensation related to the cancelled shares, her actual compensation related to stock awards for 2008 was $101,666.
 
(13) Included in other compensation is $2,250 for matching contributions to the Citadel Broadcasting Company 401(k) Retirement Savings Plan and $90 in premiums for term life insurance.
 
(14) On December 16, 2010, Citadel entered into a separation agreement with Ms. Orr pursuant to which she agreed to resign from all positions with Citadel and its affiliates, effective as of January 31, 2011. Citadel paid Ms. Orr a lump sum payment equal to $550,000 on December 31, 2010.
 
(15) Option award compensation is based on 106,451 options granted on November 19, 2010, of which 75% have an exercise price of $28.00 and a grant date fair value of $11.08 per option and 25% have an exercise price of $32.00 and a grant date fair value of $10.16 per option. All of Ms. Orr’s outstanding option awards were unvested and forfeited as of January 31, 2011.
 
(16) Included in all other compensation is $104 premium for term life insurance.
 
(17) As Ms. Orr’s bonus was paid on a cycle running from May 2007 to May 2008, she was paid a bonus of $56,250 in 2008 from the prior year’s award.
 
(18) Stock award compensation is related to 35,000 shares of restricted stock granted on June 27, 2008 at a closing price of $1.22.
 
(19) Option award compensation is based on 74,848 options granted on November 19, 2010, of which 75% have an exercise price of $28.00 and a grant date fair value of $11.08 per option and 25% have an exercise price of $32.00 and a grant date fair value of $10.16 per option.
 
(20) Mr. Taylor was appointed chief financial officer effective February 29, 2008.
 
(21) Stock award compensation was related to 60,000 shares of restricted stock granted on June 27, 2008 at a closing price of $1.22.
 
(22) Includes an additional bankruptcy emergence bonus of $150,000 for both Mr. Taylor and Ms. Orr agreed by the pre-emergence compensation committee, paid upon Citadel’s emergence from the Chapter 11 Proceedings.


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Grants of Plan-Based Awards Table
 
The table below summarizes the plan-based awards that were made in 2010:
 
                                         
            Option Awards:
      Grant Date Fair
            Number of
  Exercise or
  Value of Stock
            Securities
  Base Price of
  and Option
            Underlying
  Option Awards
  Awards
Name
  Grant Date   Approval Date   Options (#)   ($/Share)   ($)
 
Farid Suleman
    11/19/2010       11/19/2010       1,897,194 (2)(3)     28.00       21,020,910  
      11/19/2010       11/19/2010       632,397 (2)     32.00       6,425,154  
Judith A. Ellis
    11/19/2010       11/19/2010       99,798 (2)     28.00       1,105,762  
      11/19/2010       11/19/2010       33,265 (2)     32.00       337,972  
Jacquelyn J. Orr
    11/19/2010       11/19/2010       79,838 (2)     28.00       884,605