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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2020

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                 to                

Commission file number 001-38108

Cumulus Media Inc.

(Exact name of registrant as specified in its charter)

Delaware				82-5134717
(State or Other Jurisdiction of Incorporation or Organization)				(I.R.S. Employer Identification No.)
3280 Peachtree Road, NW,	Suite 2200	Atlanta,	GA	30305
(Address of Principal Executive Offices)				(ZIP Code)

(404) 949-0700

Securities Registered Pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0000001 per share	CMLS	Nasdaq Global Market
Class A common stock purchase rights	N/A	Nasdaq Global Market

Securities Registered Pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ¨    No  þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ¨    No  þ

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  þ    No  ¨

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  þ    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large accelerated filer	¨	Accelerated filer	þ
Non-accelerated filer	¨	Smaller reporting company	☑
		Emerging growth company	☐

If an emerging company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☑

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  þ

The aggregate market value of the registrant's outstanding voting and non-voting common stock held by non-affiliates of the registrant (assuming, solely for the purposes hereof, that all officers and directors (and their respective affiliates), and 10% or greater stockholders of the registrant are affiliates of the registrant, some of whom may not be deemed to be affiliates upon judicial determination) as of June 30, 2020, the last business day of the registrant's most recently completed second fiscal quarter, was approximately $60.1 million.

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes þ    No  ¨

As of February 16, 2021, the registrant had outstanding 20,410,776 shares of common stock consisting of (i) 18,041,897 shares of Class A common stock; and (ii) 2,368,879 shares of Class B common stock. No warrants are issued and outstanding. In addition, the registrant had 22,154 series 1 warrants authorized to be issued.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registration's definitive proxy statement for the 2021 Annual Meeting of Stockholders, which is expected to be filed no later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K, have been incorporated by reference into Part III, Items 10, 11, 12, 13 and 14 of this Annual Report on Form 10-K.

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CUMULUS MEDIA INC.

ANNUAL REPORT ON FORM 10-K

For the Fiscal Year Ended December 31, 2020

Item Number		Page Number
PART I
1	Business	3
1A.	Risk Factors	15
1B.	Unresolved Staff Comments	23
2	Properties	23
3	Legal Proceedings	23
4	Mine Safety Disclosures	24
PART II
5	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	24
6	Selected Financial Data	25
7	Management's Discussion and Analysis of Financial Condition and Results of Operations	25
7A.	Quantitative and Qualitative Disclosures about Market Risk	37
8	Financial Statements and Supplementary Data	37
9	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	37
9A.	Controls and Procedures	37
9B.	Other Information	38
PART III
10	Directors, Executive Officers and Corporate Governance	39
11	Executive Compensation	39
12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	39
13	Certain Relationships and Related Transactions, and Director Independence	39
14	Principal Accountant Fees and Services	39
PART IV
15	Exhibits, Financial Statement Schedules	40
16	Form 10-K Summary	42
	Signatures	43

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PART I

Item 1. Business

Description of Certain Definitions and Data

In this Annual Report on Form 10-K (this "Form 10-K" or this "Report") the terms "Company," "Cumulus," "CUMULUS MEDIA," "we," "us," and "our" refer to Cumulus Media Inc. and its consolidated subsidiaries.

We use the term "local marketing agreement" ("LMA") in this Report. In a typical LMA, the licensee of a radio station makes available, for a fee and reimbursement of its expenses, airtime on its station to a party which supplies programming to be broadcast during that airtime, and collects revenues from advertising aired during such programming.

Unless otherwise indicated, as disclosed herein we:

•obtained total radio industry listener and revenue levels from the Radio Advertising Bureau;

•derived historical market revenue statistics and market revenue share percentages from data published by Miller Kaplan, Arase LLP, a public accounting firm that specializes in serving the broadcasting industry and BIA/Kelsey, a media and telecommunications advisory services firm; and

•derived all audience share data and audience rankings, including ranking by population, from surveys of people ages 12 and over, listening Monday through Sunday, 6 a.m. to 12 midnight, as reported in the Nielsen Audio ("Nielsen") Market Report.    

Company Overview

CUMULUS MEDIA is a leading audio-first media and entertainment company delivering premium content to over a quarter billion people every month — wherever and whenever they want it. CUMULUS MEDIA engages listeners with high-quality local programming through 415 owned and operated stations across 86 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, CNN, the AP, the Academy of Country Music Awards, and many other world-class partners across nearly 7,300 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. CUMULUS MEDIA provides advertisers with personal connections, local impact and national reach through broadcast and on-demand digital, mobile, social, and voice-activated platforms, as well as integrated digital marketing services, powerful influencers, full-service audio solutions, industry-leading research and insights, and live event experiences. CUMULUS MEDIA is the only audio media company to provide marketers with local and national advertising performance guarantees. For more information visit www.cumulusmedia.com.

We are a Delaware corporation, organized in 2018, and the successor to a Delaware corporation with the same name that was organized in 2002. Our predecessor, CM Wind Down Topco Inc. (formerly known as Cumulus Media, Inc., "Old Cumulus"), and certain of its direct and indirect subsidiaries filed voluntary petitions for bankruptcy relief in November 2017. Old Cumulus and its debtor subsidiaries emerged from Chapter 11 bankruptcy on June 4, 2018 and, prior to winding down its business, it transferred substantially all of its remaining assets to an indirect wholly owned subsidiary of reorganized Cumulus Media Inc. (formerly known as CM Emergence Newco Inc. and now known as "CUMULUS MEDIA" or the "Company").

Strategic Overview

We are focused on building our competitive position in the expanding audio landscape by achieving leadership positions in the markets in which we operate and leveraging those positions in conjunction with our network platform, national scale, and local advertiser relationships to build value for all of our stakeholders. The Company seeks to achieve our objective through the execution of three specific strategies:

•enhancing operating performance to drive cash flow generation through the execution of a range of initiatives across both our radio station and network platforms to maintain or grow market share, reduce costs and improve efficiency;

•expanding high growth digital businesses in local marketing services and new audio formats such as podcasting and streaming; and

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•optimizing our asset portfolio by taking advantage of opportunities to strengthen our position in markets where we are, or can become, leaders and to exit markets or dispose of assets that are not supportive of our objectives if we can do so accretively.

Competitive Strengths

We believe our success is, and future performance will be, directly related to the following combination of characteristics that will facilitate the implementation of our strategies:

Leadership in the radio broadcasting industry and new audio formats

Currently, we offer advertisers access to a broad portfolio of 415 owned and operated stations, operating in 86 markets and nearly 7,300 network affiliates with an aggregate monthly reach of over a quarter billion listeners. Our stations and affiliates cover a wide variety of programming formats, geographic regions and audience demographics, and we engage with audiences through over-the-air, digital (including streaming and podcasting) and live interactions. This scale and diversity allow us to offer advertisers the ability to customize advertising campaigns on a national, regional and local basis through broadcast, digital and mobile mediums, as well as through live events, enabling us to compete effectively with other media and engage listeners whenever they want and wherever they are.

Leading Digital Platform

Our streaming audio platform generates on average at least 30 million listener hours per month and is available on multiple platforms for consumption. The Westwood One Podcast Network represents more than 50 podcasts featuring nationally recognized personalities, such as Ben Shapiro and Rich Eisen, generating collectively 94 million downloads, streams and listens per month on average. The podcasting platform drives revenue through podcast advertisements including prerecorded spots and on-air reads by talent who provide personal endorsements of advertisers' products. To the extent our talent has won the trust of their audiences, such endorsements can be well-received by listeners and therefore valuable to advertisers who are eager to capture the favorable attention of new and existing customers for their products. In addition, we sell an array of local digital marketing services such as, email marketing, geo-targeted display and video solutions, website building and hosting, social media management, reputation management and search engine marketing and optimization within our Cumulus C-Suite digital marketing solutions portfolio to existing and new advertisers.

National reach

As one of the largest radio advertising and content providers in the United States (the "U.S."), we provide a national platform which allows us to more effectively and efficiently compete for national and network advertising dollars. Our exclusive radio broadcast partnerships with the NFL and NCAA allow us to provide advertisers with national reach and the ability to create compelling campaigns from a local to a national level across broadcast, digital and live event offerings.

In addition, our national network platform provides targeted access to diverse demographics and age groups to better meet our customers' needs. Our sales team has the ability to aggregate advertising inventory time across our owned and operated and/or affiliate networks, and divide it into packages focused on specific demographics that can be sold to national advertisers looking to reach specific national or regional audiences.

Diversified customer base and geographic mix

We generate substantially all of our revenue from the sale of advertising time to a broad and diverse customer base, including local advertisers based in our 86 cities or "markets" in which we own radio stations as well as advertisers based outside those markets through our national network and spot ad sales. We sell our advertising time both nationally and locally through an integrated sales approach, including online couponing and various on-air and digital integrated marketing programs.

Our advertising exposure is highly diversified across a broad range of industries, which lessens the impact of the economic conditions applicable to any one specific industry or customer group. Our top industry segments by advertising volume include professional services, financial, automotive, home products and retail. We derive additional revenue from political candidates, political parties, and special interest groups particularly in even-numbered years in advance of various elections.

Focus on corporate culture

We believe maintaining a corporate culture that supports employee engagement has been, and will continue to be, important to our continued success. We believe our rigorous and systematic cultural values framework, FORCE (Focused,

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Responsible, Collaborative, and Empowered), has created motivated employees who are invested in both their jobs and the Company's progress as well as a culture that serves as a critical catalyst to driving higher performance and attracting new talent to the Company.

Ability to leverage content and advertiser relationships across platforms

Our various content platforms, including local stations, the Westwood One Network and our growing podcast and streaming businesses, provide diversified content to build relationships with listeners as well as access to a broader base of talent across those platforms. We have had recent success in extending content from one platform to another (such as from local radio to network syndication and from podcasting to broadcast radio) to build audiences and monetization opportunities and expect to continue to do so increasingly in the future. Additionally, the multiple contacts our local sales people have with their clients over the course of a year often give them a degree of familiarity with their clients' needs and the ability to tailor campaigns to help them achieve success. Over the last several years, those interactions allowed us to expand our support of new and existing clients' business objectives by offering additional products, including, most importantly, digital marketing services, which generally supplement radio buys.

Industry Overview

The primary source of revenues for radio broadcasting companies is the sale of advertising time to local, regional and national spot advertisers and network advertisers.

Generally, radio is considered an efficient, cost-effective means of reaching specifically identified demographic groups with advertising. Stations are typically classified by their on-air format, such as country, rock, adult contemporary, oldies and news/talk. A station's format and style of presentation enables it to target specific segments of listeners sharing certain demographic qualities. Advertisers and stations use data published by audience measurement services, such as Nielsen, to estimate how many people within particular geographical markets and demographics listen to specific stations. By capturing a specific share of a market's radio listening audience with particular concentration in a targeted demographic, a station is able to market its broadcasting time to advertisers seeking to reach a specific audience.

The number of advertisements that can be broadcast by a station without jeopardizing listening levels and the resulting ratings is generally dictated in part by the format of a particular station and the local competitive environment. Although the number of advertisements broadcast during a given time period may vary, the total number of advertisements broadcast on a particular station generally does not vary significantly from year to year.

A station's local sales staff generates the majority of its local and regional advertising sales through direct solicitations of local advertising agencies and businesses. To generate national advertising sales, a station usually will engage a firm that specializes in soliciting radio-advertising sales on a national level. Stations also may engage directly with an internal national sales team that supports the efforts of third-party representatives. National sales representatives obtain advertising principally from advertising agencies located outside the station's market and receive commissions based on the revenue from the advertising they obtain.

Radio stations compete for advertising revenue with other broadcast radio stations in their particular market as well as other media, including newspapers, broadcast television, cable television, magazines, direct mail, and outdoor advertising as well as search engine, e-commerce and other websites and satellite-based digital radio and music services.

Advertising Sales

The majority of our revenue is generated from the sale of local, regional, and national advertising which is broadcast on our radio stations. In addition, we generate revenue from the sale of commercial airtime our network receives from its radio station affiliates (and aggregates for sale to national advertisers) in exchange for programming and services. To a lesser extent, we also purchase commercial inventory to sell through our network and in some instances also receive cash from affiliates for network programming and services.

Our major advertiser categories are:

Automotive	General services	Professional services
Entertainment	Home products	Retail
Financial	Political	Telecommunications/Media

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In addition, in advance of various elections, we derive revenue from political candidates, political parties, and special interest groups, particularly in even-numbered years.

Each station's local sales staff solicits advertising either directly from a local advertiser or indirectly through an advertising agency. We use a tiered commission structure to focus our sales staff on new business development. We believe that we can outperform our competitors by (1) expanding our base of advertisers, (2) properly training sales people and (3) providing a higher level of service to our existing customer base.

Advertising sales to national spot advertisers for our radio stations are made by a firm specializing in radio advertising sales on the national level, in exchange for a commission that is based on the gross revenue from the advertising generated. Regional sales, which we define as sales in regions surrounding our markets to buyers that advertise in our markets, are generally made by our local sales staff and market managers. While we seek to grow our local sales through more customer-focused sales staff, we seek to grow our national and regional sales by offering key national and regional advertisers access to groups of stations within specific markets and regions that make us a more attractive platform.

Each of our stations has a certain amount of on-air inventory, or advertising slots, in which to place advertising spots. This level of advertising inventory may vary at different times of the day but tends to remain stable over time. Our stations strive to maximize revenue by managing their on-air advertising inventory and adjusting prices up or down based on supply and demand. We seek to broaden our advertiser base in each market by providing a wide array of audience demographic groups across each cluster of stations, thereby providing potential advertisers with an effective means to reach a targeted demographic group. Our sales volume and pricing is based on demand for our radio stations' on-air inventory. Most changes in revenue are explained by a combination of demand-driven pricing changes and changes in inventory utilization rather than by changes in available inventory. Advertising rates charged by radio stations, which are generally highest during morning and afternoon commuting hours, are based primarily on:

•a station's share of audiences and the demographic groups targeted by advertisers (as measured by ratings surveys);

•the supply and demand for radio advertising time and for time targeted at particular demographic groups in a given market; and

•certain additional qualitative factors, such as the brand loyalty of listeners to a specific station.

A station's listenership is reflected in ratings surveys, where available, that estimate the number of listeners tuned in to the station, and the time they spend listening. Each station's ratings are used by its advertisers and advertising representatives to consider advertising with the station and are used by Cumulus to chart changes in audience, set advertising rates and adjust programming.

Competition

The radio broadcasting industry is very competitive. Our stations compete for listeners and advertising revenues directly with other radio stations within their respective markets, as well as with other news, information and entertainment media. Additionally, we compete with various digital platforms and services, including streaming music and other entertainment services for both listeners and advertisers. We cannot predict how existing or new sources of competition will affect our performance and results of operations.

Factors that affect a radio station's competitive position include station brand identity and loyalty, the attractiveness of the station's programming content to audiences, the station's local audience rating and share in its market, transmitter power and location, assigned frequency, audience characteristics, local program acceptance and the number and characteristics of other radio stations and other advertising media in the market area. We attempt to improve our competitive position in each market through research, seeking to improve our stations' programming, implementing targeted advertising campaigns aimed at the demographic groups for which our stations program and managing our sales efforts to attract a larger share of advertising dollars for each station individually. We also seek to improve our competitive position by focusing on building a strong brand identity with a targeted listener base consisting of specific demographic groups in each of our markets, which we believe will allow us to better attract advertisers seeking to reach those listeners.

The success of each of our stations depends largely upon rates it can charge for its advertising, which in turn is affected by the number of local advertising competitors, the overall demand for advertising within individual markets and the station's listener base. These conditions may fluctuate and are highly susceptible to changes in both local markets and general macroeconomic conditions. Specifically, a radio station's competitive position can be enhanced or negatively impacted by a variety of factors, including the changing of, or another station changing, its format to compete directly for a certain demographic of listeners and advertisers or an upgrade of the station's authorized power through the relocation or upgrade of transmission equipment. Another station's decision to convert to a similar format to that of one of our radio stations in the same

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geographic area, to improve its signal reach through equipment changes or upgrades, or to launch an aggressive promotional campaign may result in lower ratings and advertising revenue for our station. Any adverse change affecting advertising expenditures in a particular market or in the relative market share of our stations located in a particular market could have a material adverse effect on the results of our radio stations located in that market or, possibly, the Company as a whole. There can be no assurance that any one or all of our stations will be able to maintain or increase advertising revenue market share.

Under federal laws and Federal Communications Commission (the "FCC") rules, a single party can own and operate multiple stations in a local market, subject to certain limitations described below. We believe that companies that form groups of commonly owned stations or joint arrangements, such as LMAs, in a particular market may, in certain circumstances, have lower operating costs and may be able to offer advertisers in those markets more attractive rates and services. Although we currently operate multiple stations in most of our markets and may pursue the creation of additional multiple station groups in particular markets, our competitors in certain markets include other parties that own and operate as many or more stations as we do.

Some of these regulations, however, can serve to protect the competitive position of existing radio stations to some extent by creating certain regulatory barriers to new entrants. The ownership of a radio broadcast station requires an FCC license, and the number of radio stations that an entity can own in a given market is limited under certain FCC rules. These FCC ownership rules may, in some instances, limit the number of stations we or our competitors can own or operate, or may limit potential new market entrants. However, FCC ownership rules may change in the future to reduce any protections they currently provide. We also cannot predict what other matters might be considered in the future by the FCC or Congress, nor can we assess in advance what impact, if any, the implementation of any of these proposals or changes might have on our business. For a discussion of FCC regulation (including recent changes), see "Federal Regulation of Radio Broadcasting" within Item 1, "Business."

Human Capital

We believe that our rigorous focus on our culture strategy has motivated our employees who are invested in both their jobs and the Company's progress. Their engagement serves not only to drive higher performance, but also helps to attract new talent to the Company. It also enables us to retain valuable members of our team. We consistently monitor our cultural progress through frequent survey and feedback mechanisms. This allows us to build on proven practices, while adjusting as necessary in order to achieve the highest possible levels of employee engagement.

The high engagement of our workforce underpins the Company’s ability to swiftly react to challenges as they arise. In the face of the novel coronavirus disease ("COVID-19") pandemic, our employees navigated through the unprecedented circumstances with professionalism, creativity, and resiliency.

As of December 31, 2020, our workforce comprised 3,787 people, 2,743 of whom were employed full-time. Of these employees, approximately 126 employees were covered by collective bargaining agreements. We have not experienced any material work stoppages by our employees covered by collective bargaining agreements, and overall, we consider our relations with our employees to be positive.

On occasion, we enter into contracts with various on-air personalities who have large, loyal audiences in their respective markets. We do that in order to protect our interests in those relationships that we believe to be valuable. The loss of one of these personalities could result in a short-term loss of audience share, but we do not believe that any such loss would have a material adverse effect on our financial condition or results of operations.

Seasonality and Cyclicality

Our advertising revenues vary by quarter throughout the year. As is typical with advertising revenue supported businesses, our first calendar quarter typically produces the lowest revenues of any quarter during the year, as advertising generally declines following the winter holidays. The second and fourth calendar quarters typically produce the highest revenues for the year. In addition, our revenues tend to fluctuate between years, consistent with, among other things, increased advertising expenditures in even-numbered years by political candidates, political parties and special interest groups. Typically, this political spending is heaviest during the fourth quarter.

Inflation

To date, inflation has not had a material effect on our revenues, expenses, or results of operations, although no assurances can be provided that inflation in the future would not materially adversely affect us.

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Federal Regulation of Radio Broadcasting

The ownership, operation and sale of radio broadcast stations, including those licensed to us, are subject to the jurisdiction of the FCC, which acts under authority of the Communications Act of 1934, as amended (the "Communications Act"). Among its other regulatory responsibilities, the FCC issues permits and licenses to construct and operate radio stations; assigns broadcast frequencies; determines whether to approve changes in ownership or control of station licenses; regulates transmission equipment, operating power, and other technical parameters of stations; adopts and implements regulations and policies that directly or indirectly affect the ownership, operation and employment practices of stations; regulates the content of some forms of radio broadcast programming; and has the authority under the Communications Act to impose penalties for violations of its rules.

The following is a brief summary of certain provisions of the Communications Act, and related FCC rules and policies (collectively, the "Communications Laws"). This description does not purport to be comprehensive, and reference should be made to the Communications Laws, public notices, and decisions issued by the FCC for further information concerning the nature and extent of federal regulation of radio broadcast stations. Failure to observe the provisions of the Communications Laws can result in the imposition of various sanctions, including monetary forfeitures and the grant of a "short-term" (less than the maximum term) license renewal. For particularly egregious violations, the FCC may deny a station's license renewal application, revoke a station's license, or deny applications in which an applicant seeks to acquire additional broadcast properties.

License Grant and Renewal

Radio broadcast licenses are generally granted and renewed for terms of up to eight years at a time. Licenses are renewed by filing an application with the FCC, which is subject to review and approval. The Communications Act expressly provides that a radio station is authorized to continue to operate after the expiration date of its existing license until the FCC acts on a pending renewal application. Petitions to deny license renewal applications may be filed by interested parties, including members of the public. The most recent renewal cycle for radio licenses began in June 2019 and will conclude in April 2022. There can be no assurance that all of our licenses will be renewed in the future for a full term, or at all. Our inability to renew a significant portion of our radio broadcast licenses could result in a material adverse effect on our results of operations and financial condition.

Service Areas

The area served by an AM station is determined by a combination of frequency, transmitter power, antenna orientation, and soil conductivity. To determine the effective service area of an AM station, the station's power, operating frequency, antenna patterns and its day/night operating modes are evaluated. The area served by an FM station is determined by a combination of effective radiated power ("ERP"), antenna height and terrain, with stations divided into eight classes according to these technical parameters.

Each class of FM radio station has the right to broadcast with a certain amount of ERP from an antenna located at a certain height above average terrain. The most powerful FM radio stations, which are generally those with the largest geographic reach, are Class C FM stations, which operate with up to the equivalent of 100 kilowatts ("kW") of ERP at an antenna height of 1,968 feet above average terrain. These stations typically provide service to a large area that covers one or more counties (which may or may not be in the same state). There are also Class C0, C1, C2 and C3 FM radio stations which operate with progressively less power and/or antenna height above average terrain and, thus, less geographic reach. In addition, Class B FM stations operate with the equivalent of up to 50 kW ERP at an antenna height of 492 feet above average terrain. Class B stations can serve large metropolitan areas and their outer suburban areas. Class B1 stations can operate with up to the equivalent of 25 kW ERP at an antenna height of 328 feet above average terrain. Class A FM stations operate with up to the equivalent of 6 kW ERP at an antenna height of 328 feet above average terrain, and often serve smaller cities or suburbs of larger cities.

The following table sets forth, as of February 16, 2021, the number of stations by market of all our owned and operated stations, including stations operated under an LMA, whether or not pending acquisition, and all other announced pending station acquisitions, if any.

Market	Stations
Albilene, TX	4
Albuquerque, NM	8

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Market	Stations
Allentown, PA	6
Amarillo, TX	5
Ann Arbor, MI	4
Appleton, WI / Green Bay, MI	10
Atlanta, GA	3
Baton Rouge, LA	4
Beaumont, TX	5
Birmingham, AL	6
Bloomington, IL	5
Boise, ID	6
Buffalo, NY	5
Charleston, SC	5
Chattanooga, TN	4
Chicago, IL	3
Cincinnati, OH	5
Colorado Springs, CO	6
Columbia, MO	7
Columbia, SC	5
Columbus-Starkville, MS	5
Dallas, TX	7
Des Moines, IA	5
Detroit, MI	3
Erie, PA	4
Eugene, OR	6
Fayetteville, AR	7
Fayetteville, NC	4
Flint, MI	5
Florence, SC	8
Fort Smith, AR	3
Fresno, CA	5
Ft. Walton Beach, FL	5
Grand Rapids, MI	5
Harrisburg, PA	5
Houston, TX	1
Huntsville, AL	6
Indianapolis, IN	6
Johnson City, TN	5
Kansas City, MO-KS	6
Knoxville, TN	4
Kokomo, IN	1
Lafayette, LA	5
Lake Charles, LA	6

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Market	Stations
Lancaster, PA	2
Lexington, KY	6
Little Rock, AR	7
Los Angeles, CA	1
Macon, GA	6
Melbourne, FL	4
Memphis, TN	4
Minneapolis, MN	5
Mobile, AL	5
Modesto, CA / Stockton, CA	8
Montgomery, AL	6
Muncie, IN	2
Muskegon, MI	5
Myrtle Beach, SC	4
Nashville, TN	5
New London, CT	3
New Orleans, LA	4
New York, NY	1
Oklahoma City, OK	7
Oxnard-Ventura, CA / Santa Barbara, CA	5
Pensacola, FL	5
Peoria, IL	5
Providence, RI	6
Reno, NV	4
Saginaw, MI	4
Salt Lake City, UT	6
San Francisco, CA	6
Savannah, GA	4
Shreveport, LA	5
Syracuse, NY	3
Tallahasee, FL	4
Toledo, OH	5
Topeka, KS	7
Tucson, AZ	5
Washington, DC	2
Westchester, NY	1
Wichita Falls, TX	4
Wilkes-Barre, PA	6
Wilmington, NC	5
Worcester, MA	3
York, PA	4
Youngstown, OH	8

Regulatory Approvals

The Communications Laws prohibit the assignment or transfer of control of a broadcast license without the prior approval of the FCC. In determining whether to grant an application for assignment or transfer of control of a broadcast license, the Communications Act requires the FCC to find that the assignment or transfer would serve the public interest. The FCC considers a number of factors in making this determination, including (1) compliance with various rules limiting common ownership or control of media properties, (2) the financial and "character" qualifications of the assignee or transferee (including those parties holding an "attributable" interest in the assignee or transferee), (3) compliance with the Communications Act's foreign ownership restrictions, and (4) compliance with other Communications Laws, including those related to programming and filing requirements. As discussed in greater detail below, the FCC may also review the effect of proposed assignments and transfers of broadcast licenses on economic competition and diversity. See "Antitrust and Market Concentration Considerations" within Item 1, "Business."

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In connection with our 2011 acquisition of Citadel Broadcasting Corporation and our emergence from Chapter 11 in June 2018, we were required to place certain stations into two divestiture trusts in compliance with the FCC rules. The trust agreements stipulated that we must fund any operating shortfalls from the activities of the stations in the trusts, and any excess cash flow generated by such stations will be distributed to us until the stations are sold. As of February 16, 2021, there are three stations remaining in those trusts.

Ownership Matters

The Communications Act restricts us from having more than 25% of our capital stock owned or voted by non-U.S. persons, foreign governments or non-U.S. corporations. We are required to take steps to monitor the citizenship of our stockholders based principally on our review of ownership information that is known or reasonably should be known to us to establish a reasonable basis for certifying compliance with the foreign ownership restrictions of the Communications Act. In November 2013, the FCC issued a declaratory ruling in which it stated that it would review requests for companies to exceed the 25% alien ownership threshold in the Communications Act on a case-by-case basis. Since that time, the FCC acted on a number of petitions for declaratory ruling which requested that various entities be permitted to exceed the 25% foreign equity and voting limitations. In those cases, the FCC permitted foreign ownership of as much as 100% by both specifically-identified foreign persons and generally, subject to various conditions. We filed a petition for declaratory ruling with the FCC in July 2018 requesting that we be permitted to have 100% foreign ownership generally. In May 2020, the Commission granted that petition allowing us to have 100% foreign voting and/or equity ownership, subject to certain conditions.

The Communications Laws also generally restrict the number of radio stations one person or entity may own, operate or control in a local market. The Communications Laws also (1) restrict the common ownership, operation or control of radio broadcast stations and television broadcast stations serving the same local market, and (2) prohibit the common ownership, operation or control of a radio broadcast station and a daily newspaper serving the same local market. Although those "cross-ownership" rules were lifted by the FCC in February 2018, the U.S. Court of Appeals for the Third Circuit vacated the FCC's action in September 2019 and issued a mandate reinstating the newspaper-broadcast and radio-television cross-ownership rules in November 2019. In October 2020, the U.S. Supreme Court agreed to hear an appeal of the Court of Appeals decision. In December 2018, the FCC released a Notice of Proposed Rulemaking to launch its 2018 quadrennial review of multiple ownership rules. The Notice of Proposed Rulemaking does not make any specific proposals but seeks comment regarding whether its local radio ownership rule limits should be modified. We cannot predict whether the FCC will adopt changes to the local radio ownership rule or what impact any such changes would have on our holdings.

To our knowledge, these multiple and cross-ownership rules do not require any change in our current ownership of radio broadcast stations. The Communications Laws limit the number of additional stations that we may acquire in the future in our existing markets as well as any new markets.

Because of these multiple and cross-ownership rules, a purchaser of our voting stock who acquires an "attributable" interest in Cumulus (as discussed below) may violate the Communications Laws if such purchaser also has an attributable interest in other broadcast stations or daily newspapers, depending on the number and location of those stations and newspapers. Such purchaser may also be restricted in the companies in which it may invest to the extent that those investments give rise to an attributable interest. If one of our stockholders with an attributable interest violates any of these ownership rules, we may be unable to obtain one or more authorizations from the FCC needed to conduct our radio station business and may be unable to obtain FCC consents for certain future acquisitions.

The FCC generally applies its multiple and cross-ownership rules by considering the "attributable" interests held by a person or entity. With some exceptions, a person or entity will be deemed to hold an attributable interest in a broadcast station or newspaper if the person or entity serves as an officer, director, partner, stockholder, member, or, in certain cases, a debt holder of a company that owns that station or newspaper. If an interest is attributable, the FCC treats the person or entity that holds that interest as the "owner" of the station or newspaper in question, and, thus, that interest is attributed to the person in determining compliance with the FCC's ownership rules.

With respect to a corporation, officers, directors and persons or entities that directly or indirectly hold 5% or more of the corporation's voting stock (20% or more of such stock in the case of insurance companies, investment companies, bank trust departments and certain other "passive investors" that hold such stock for investment purposes only) generally are attributed with ownership of the media outlets owned by the corporation. As discussed below, participation in an LMA or a Joint Sales Agreement ("JSA") also may result in an attributable interest. See "Local Marketing Agreements" and "Joint Sales Agreements" within Item 1, "Business."

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With respect to a partnership (or limited liability company), the interest of a general partner (or managing member) is attributable. The following interests generally are not attributable: (1) debt instruments, non-voting stock, options and warrants for voting stock, partnership interests, or membership interests that have not yet been exercised; (2) limited partnership or limited liability company membership interests where (a) the limited partner or member is not "materially involved" in the media-related activities of the partnership or limited liability company, and (b) the limited partnership agreement or limited liability company agreement expressly "insulates" the limited partner or member from such material involvement by inclusion of specific provisions; and (3) holdings of less than 5% of an entity's voting stock (unless stock or other equity holdings, whether voting or non-voting and whether insulated or not, and/or debt interests collectively constitute more than 33% of a broadcast station's "enterprise value," which consists of the total equity and debt capitalization, and the non-voting stockholder or equity-holder/debt holder has an attributable interest in another station in the same market or supplies more than 15% of the programming of the station owned by the entity in which such holder holds such stock, equity or debt interests).

Programming and Operation

The Communications Act requires broadcasters to serve the "public interest." To satisfy that obligation broadcasters are required by FCC rules and policies to present programming that is responsive to community problems, needs and interests and to maintain certain records demonstrating such responsiveness. FCC rules require that each radio broadcaster place a list in its public inspection file at the end of each quarter that identifies important community issues and the programs the radio broadcaster used in the prior quarter to address those issues. Radio station public inspection files are maintained on the FCC's publicly-accessible online database, and station licensees are required to upload required information to their respective files.

Complaints from listeners concerning a station's programming may be filed at any time and will be considered by the FCC both at the time they are filed and in connection with a licensee's renewal application. FCC rules also require broadcasters to provide equal employment opportunities ("EEO") in the hiring of personnel, to abide by certain procedures in advertising employment opportunities, to make information available on employment opportunities on their website (if they have one), and maintain certain records concerning their compliance with EEO rules. The FCC will entertain individual complaints concerning a broadcast licensee's failure to abide by the EEO rules and also conducts random audits on broadcast licensees' compliance with EEO rules. We have been subject to numerous EEO audits. To date, none of those audits has disclosed any major violation that would have a material adverse effect on our cash flows, financial condition or operations. Stations also must follow provisions in the Communications Laws that regulate a variety of other activities, including political advertising, the broadcast of obscene or indecent programming, sponsorship identification, the broadcast of contests and lotteries, and technical operations (including limits on radio frequency radiation).

In October 2015, the FCC made changes to certain technical rules regarding the AM radio service, and also adopted procedures designed to make it easier for owners of AM stations to use FM translators to rebroadcast their AM stations' signals. In August 2019, new FCC rules regarding procedures to resolve interference disputes between full power FM radio stations and FM translators, including limiting full power stations to bringing complaints only in cases where interference occurs within the station's 45 dBu contour, became effective. In October 2020, the FCC amended its rules to allow AM stations to voluntarily convert to all-digital operations. We cannot predict the extent, if any, to which any of those rules changes and procedures will affect our operations.

We are and have been subject to listener complaints and FCC enforcement actions from time to time on a variety of matters. While none of them have had a material adverse effect on our cash flows, financial condition or operations as a whole to date, we cannot predict whether any future complaint or action might have a material adverse effect on our cash flows, financial condition or operations.

Local Marketing Agreements

A number of radio stations, including certain of our stations, have entered into LMAs. In a typical LMA, the licensee of a station makes available, for a fee and reimbursement of its expenses, airtime on its station to a party which supplies programming to be broadcast during that airtime, and collects revenues from advertising aired during such programming. LMAs are subject to compliance with the antitrust laws and the Communications Laws, including the requirement that the licensee must maintain independent control over the station and, in particular, its personnel, programming, and finances.

A station that brokers more than 15% of the weekly programming hours on another station in its market will be considered to have an attributable ownership interest in the brokered station for purposes of the FCC's ownership rules. As a result, a radio station may not enter into an LMA that allows it to program more than 15% of the weekly programming hours of another station in the same market that it could not own under the FCC's multiple ownership rules.

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Joint Sales Agreements

From time to time, radio stations enter into JSAs. A typical JSA authorizes one party or station to sell another station's advertising time and retain the revenue from the sale of that airtime in exchange for a periodic payment to the station whose airtime is being sold (which may include a share of the revenue collected from the sale of airtime). Like LMAs, JSAs are subject to compliance with antitrust laws and the Communications Laws, including the requirement that the licensee must maintain independent control over the station and, in particular, its personnel, programming, and finances.

Under the FCC's ownership rules, a radio station that sells more than 15% of the weekly advertising time of another radio station in the same market will be attributed with the ownership of that other station. For that reason, a radio station cannot have a JSA with another radio station in the same market if the FCC's ownership rules would otherwise prohibit that common ownership.

Content, Licenses and Royalties

We must pay royalties to song composers and publishers whenever we broadcast musical compositions. Such copyright owners of musical compositions most often rely on intermediaries known as performing rights organizations ("PROs") to negotiate licenses with copyright users for the public performance of their compositions, collect royalties under such licenses and distribute them to copyright owners. We have obtained public performance licenses from, and pay license fees to, the three major PROs in the U.S., which are the American Society of Composers, Authors and Publishers ("ASCAP"), Broadcast Music, Inc. ("BMI") and SESAC, Inc. ("SESAC"). There is no guarantee that a given songwriter or publisher will remain associated with ASCAP, BMI or SESAC or that additional PROs will not emerge. In 2013, a new PRO was formed named Global Music Rights ("GMR"). GMR has secured the rights to certain copyrights and is seeking to negotiate individual licensing agreements with radio stations for songs in its repertoire. GMR and the Radio Music License Committee, Inc. ("RMLC"), which negotiates music licensing fees with PROs on behalf of many U.S. radio stations, have instituted antitrust litigation against one another. The litigation is ongoing. The withdrawal of a significant number of musical composition copyright owners from the three established PROs, the emergence of one or more additional PROs, and the outcome of the GMR/RMLC litigation could impact, and in some circumstances increase, our royalty rates and negotiation costs.

Antitrust and Market Concentration Considerations

From time to time, Congress and the FCC have considered, and may in the future consider and adopt, new laws, regulations and policies regarding a wide variety of matters that could, directly or indirectly, affect the operation, ownership or profitability of our radio stations, result in the loss of audience share and advertising revenues for our radio stations, or affect our ability to acquire additional radio stations or finance such acquisitions.

Pending and potential future acquisitions, to the extent they meet specified size thresholds, will be subject to applicable waiting periods and possible review under the Hart-Scott-Rodino Act (the "HSR Act"), by the Department of Justice (the "DOJ") or the Federal Trade Commission (the "FTC"), either of which can be required to, or can otherwise decide to, evaluate a transaction to determine whether that transaction should be challenged under the federal antitrust laws. Transactions generally are subject to the HSR Act if the acquisition price or fair market value of the stations to be acquired is $94 million or more (that threshold will be adjusted downward to $92 million effective March 4, 2021.) Acquisitions that are not required to be reported under the HSR Act may still be investigated by the DOJ or the FTC under the antitrust laws before or after consummation. At any time before or after the consummation of a proposed acquisition, the DOJ or the FTC could take such action under the antitrust laws as it deems necessary, including seeking to enjoin the acquisition or seeking divestiture of the business acquired or certain of our other assets. The DOJ has reviewed numerous potential radio station acquisitions where an operator proposed to acquire additional stations in its existing markets or multiple stations in new markets, and has challenged a number of such transactions. Some of these challenges have resulted in consent decrees requiring the sale of certain stations, the termination of LMAs or other relief. In general, the DOJ has more closely scrutinized radio mergers and acquisitions resulting in local market shares in excess of 35% of local radio advertising revenues, depending on format, signal strength and other factors. There is no precise numerical rule, however, and certain transactions resulting in more than 35% revenue shares have not been challenged, while certain other transactions may be challenged based on other criteria such as audience shares in one or more demographic groups as well as the percentage of revenue share. We estimate that we have more than a 35% share of radio advertising revenues in many of our markets.

We are aware that the DOJ commenced, and subsequently discontinued, investigations of several of our prior transactions. The DOJ can be expected to continue to enforce the antitrust laws in this manner, and there can be no assurance that future mergers, acquisitions and divestitures will not be the subject of an investigation or enforcement action by the DOJ or the FTC. Similarly, there can be no assurance that the DOJ, FTC or FCC will not prohibit such mergers, acquisitions and

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divestitures, require that they be restructured, or in appropriate cases, require that we divest stations we already own in a particular market or divest specific lines of business. In addition, private parties may under certain circumstances bring legal action to challenge a merger, acquisition or divestiture under the antitrust laws.

As part of its review of certain radio station acquisitions, the DOJ has stated publicly that it believes that commencement of operations under LMAs, JSAs and other similar agreements customarily entered into in connection with radio station ownership assignments and transfers prior to the expiration of the waiting period under the HSR Act could violate the HSR Act. In connection with acquisitions subject to the waiting period under the HSR Act, we will not commence operation of any affected station to be acquired under a LMA, a JSA, or similar agreement until the waiting period has expired or been terminated.

No assurances can be provided that actual, threatened or possible future DOJ or FTC action in connection with potential transactions would not have a material adverse effect on our ability to enter into or consummate various transactions, or operate any acquired stations at any time in the future.

Information about our Executive Officers

The following table sets forth certain information with respect to our executive officers as of February 16, 2021:

Name	Age	Position(s)
Mary G. Berner	61	President and Chief Executive Officer
Francisco J. Lopez-Balboa	60	Executive Vice President, Chief Financial Officer
Richard S. Denning	54	Executive Vice President, General Counsel and Secretary
Suzanne M. Grimes	62	Executive Vice President of Corporate Marketing and President of Westwood One
Dave Milner	52	Executive Vice President of Operations
Bob Walker	60	Executive Vice President of Operations

Mary G. Berner is our President and Chief Executive Officer ("CEO"). Ms. Berner was initially elected to the Board of Directors at our 2015 annual meeting of stockholders. Prior to being appointed as CEO in October 2015, Ms. Berner served as President and CEO of MPA - The Association of Magazine Media, a nonprofit trade association for the magazine media industry, since September 2012. From 2007 to 2011, she served as CEO of Reader's Digest Association. Before that, from November 1999 until January 2006, she led Fairchild Publications, Inc., first as President and CEO and then as President of Fairchild and as an officer of Condé Nast. She has also held leadership roles at Glamour and TV Guide. Ms. Berner serves and has served on a variety of industry and not-for-profit boards. Ms. Berner received her Bachelor of Arts from the College of the Holy Cross.

Francisco J. Lopez-Balboa is our Executive Vice President, Chief Financial Officer ("CFO"). Mr. Lopez-Balboa joined the Company in March 2020. Prior to joining the Company, Mr. Lopez-Balboa served as Executive Vice President and CFO of Univision Communications Inc., ("Univision"), the leading media company serving Hispanic America, from 2015 to 2018. He has deep experience in the media sector; prior to joining Univision, Mr. Lopez-Balboa was an investment banker working with Telecom, Media and Technology ("TMT") companies. Mr. Lopez-Balboa was a Managing Director at Goldman, Sachs & Co. for more than 20 years where he last led the firm’s TMT Investment Grade Debt Financing business. Mr. Lopez-Balboa began his career in the Investment Banking Capital Markets Group at Merrill, Lynch & Co. Mr. Lopez-Balboa is an Emeritus Trustee of the Board of Visitors for the undergraduate college at Columbia University and is a Trustee, Treasurer and member of the Investment Committee for St. Mark’s School in Southborough, Massachusetts. He has served on the board of several not-for-profit organizations. Mr. Lopez-Balboa holds an MBA from Harvard University and Bachelor of Arts in Economics from Columbia University.

Richard S. Denning is our Executive Vice President, General Counsel and Secretary. Prior to joining the Company in February 2002, Mr. Denning was an attorney with Dow, Lohnes & Albertson, PLLC ("DL&A") within DL&A's corporate practice group in Atlanta, advising a number of media and communications companies on a variety of corporate and transactional matters. Mr. Denning also spent four years in DL&A's Washington, D.C. office and has extensive experience in regulatory proceedings before the FCC. Mr. Denning has been a member of the Pennsylvania Bar since 1991, the District of Columbia Bar since 1993, and the Georgia Bar since 2000. He is a graduate of The National Law Center, George Washington University.

Suzanne M. Grimes is our Executive Vice President of Corporate Marketing and President of Westwood One. Prior to joining our Company in January 2016, Ms. Grimes served as Founder and Chief Executive Officer of Jott LLC, a

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consultancy for media and technology start-ups, since January 2015. From December 2012 to September 2014, Ms. Grimes served as President and Chief Operating Officer of Clear Channel Outdoor North America. Prior to that, Ms. Grimes held leadership roles at News Corp, Condé Nast and Reader's Digest and previously served on the Board of the Outdoor Advertising Association of America and MPA - The Association of Magazine Media. She currently serves on the board of the Radio Advertising Bureau. Ms. Grimes earned a Bachelor of Science degree in Business Administration from Georgetown University.

Dave Milner is our Executive Vice President of Operations. In this role, he leads operations for our large market portfolio. Mr. Milner joined Cumulus Media in December 2014 as SVP, Operation of the Western Region. Prior to joining Cumulus Media, he was President/Market Manager of iHeart's Sacramento Market. Other key roles in his 29-year broadcasting career include Vice President of Sales for Entercom San Francisco, as well as Clear Channel Portland. He received a bachelor's degree from the University of Oregon.

Bob Walker is our Executive Vice President of Operations. In this role, Bob's responsibility is for the vast majority of the markets where audiences are measured by Nielsen using the Diary methodology or smaller markets with no audience measurement by Nielsen. He is also the co-Head of the Office of Programming for the Company. Mr. Walker joined Cumulus in January of 2013 as the Senior Vice President of Brand Solutions. Prior to joining Cumulus, Mr. Walker was the Executive Vice President-General Manager at The Weather Channel responsible for the cable network. Mr. Walker began his career with Gannett (now Tegna) at WXIA-TV in Atlanta in 1988 and remained with Gannett for nearly 22 years where he ultimately became President-General Manager. Mr. Walker began his professional career at Arthur Andersen with the Denver office in 1982. He received his Bachelor of Science degree in Business Administration and Management from the University of Colorado-Boulder.

Available Information

The Company files annual, quarterly and current reports, proxy statements and other information with the Securities Exchange Commission (the "SEC"). The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. Our Internet site address is www.cumulusmedia.com. The information on our website is not incorporated by reference or part of this or any report we file with or furnish to the SEC. On our site, we make available, free of charge, our most recent Annual Report on Form 10-K, subsequent quarterly reports, our proxy statements and other information we file with the SEC, as soon as reasonably practicable after such documents are filed. You can access our SEC filings through our website by clicking the "SEC Filings" section under the "INVESTORS" tab.

Item 1A. Risk Factors

Many statements contained or incorporated by reference in this Report are forward-looking in nature. These statements are based on our current plans, intentions or expectations, and actual results could differ materially as we cannot guarantee that we will achieve these plans, intentions or expectations. See "Cautionary Statement Regarding Forward-Looking Statements" within Item 1A, "Risk Factors." Forward-looking statements are subject to numerous risks and uncertainties, including those specifically identified below. The Company cautions you not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Additional factors not presently known to the Company, or that the Company does not currently believe to be material, may also cause actual results to differ materially from expectations. Except as may be required by law, the Company undertakes no obligation to update or alter these forward-looking statements, whether as a result of new information, future events, or otherwise.

Operating Risks

Our business and operations could be adversely affected by health epidemics, such as the COVID-19 pandemic, impacting the markets and communities in which we and our partners, advertisers, and users operate.

We face various risks related to health epidemics, pandemics and similar outbreaks, such as the global outbreak of COVID-19. The COVID-19 global pandemic has negatively impacted the economy, disrupted consumer spending and created significant volatility and disruption of financial markets. As a result, we experienced a decline in revenue during the fiscal year 2020. We expect the COVID-19 global pandemic to continue to have a negative impact on our business including our results of operations, financial condition and liquidity. The extent of the impact of the COVID-19 global pandemic on our business, including our ability to execute our near-term and long-term business strategies and initiatives in the expected time frame, will depend on numerous evolving factors that we may not be able to accurately predict or assess, including the duration and scope of the pandemic; the negative impact it has on the economy and economic activity, changes in advertising customers and consumer behavior, impact of governmental regulations that might be imposed in response to the pandemic, its short and

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longer-term impact on the levels of consumer confidence; actions governments, businesses and individuals take in response to the pandemic; and how quickly economies recover after the COVID-19 pandemic subsides.

The COVID-19 pandemic has had, and will continue to have, a widespread and broad reaching effect on the economy and could have adverse impacts on national and local businesses that we currently rely on with respect to our operations, which has resulted and could continue to result in a decrease in advertising spend and/or heighten the risk with respect to the collectability of our accounts receivable. Additionally, as a result of the COVID-19 pandemic, we have experienced a disruption in events we produce, including the cancellation or postponement of certain sporting events. The ultimate impact of these disruptions, including the extent of their adverse impact on our financial and operational results, will be impacted by the length of time that such disruptions continue, which will, in turn, depend on the currently unknown duration of the COVID-19 pandemic and the impact of governmental regulations and other restrictions that might be imposed in response to the pandemic.

We continue to work with our stakeholders (including customers, employees, consumers, suppliers, business partners and local communities) to responsibly address this global pandemic. We will continue to monitor the situation and assess possible implications to our business and our stakeholders and will take appropriate actions in an effort to mitigate adverse consequences. We cannot assure you that we will be successful in any such mitigation efforts. The extent of the impact of the COVID-19 global pandemic on our business is highly uncertain and difficult to predict, as information is rapidly evolving with respect to the duration and severity of the pandemic. At this point, we cannot reasonably estimate the duration and severity of the COVID-19 global pandemic, or its overall impact on our business. Even after the COVID-19 global pandemic has subsided, we may continue to experience adverse impacts to our business as a result of any economic recession or depression that has occurred or may occur in the future.

The effects of COVID-19 may also impact financial markets and corporate credit markets which could adversely impact our access to financing or the terms of any such financing. To the extent the COVID-19 pandemic adversely affects our business and financial results, it may also have the effect of heightening many of the other risks described herein.

The success of our business is dependent upon advertising revenues, which are seasonal and cyclical, and also fluctuate as a result of a number of factors, some of which are beyond our control.

Our main source of revenue is the sale of advertising. Our ability to sell advertising depends on, among other things:

•economic conditions in the areas where our stations are located and in the nation as a whole;

•national and local demand for radio advertising;

•the popularity of the programming offered by our stations;

•changes in the population demographics in the areas where our stations are located;

•local and national advertising price fluctuations, which can be affected by the availability of programming, the popularity of programming, and the relative supply of and demand for commercial advertising;

•the capability and effectiveness of our sales organization;

•our competitors' activities, including increased competition from other advertising-based mediums;

•decisions by advertisers to withdraw or delay planned advertising expenditures for any reason; and

•other factors beyond our control.

Our operations and revenues also tend to be seasonal in nature, with generally lower revenue generated in the first quarter of the year and generally higher revenue generated in the second and fourth quarters of the year. This seasonality causes and will likely continue to cause a variation in our quarterly operating results. Such variations could have a material effect on the timing of our cash flows. In addition, our revenues tend to fluctuate between years, consistent with, among other things, increased advertising expenditures in even-numbered years by political candidates, political parties and special interest groups.

The loss of affiliation agreements by our radio networks could materially adversely affect our financial condition and results of operations.

We have approximately 7,300 broadcast radio stations affiliated with our Westwood One network. Westwood One receives advertising inventory from its affiliated stations, either in the form of stand-alone advertising time within a specified time period or commercials inserted by its radio networks into their programming. In addition, primarily with respect to satellite radio providers, we receive a fee for providing such programming. The loss of network affiliation agreements by Westwood One could adversely affect our results of operations by reducing the advertising inventory available to us to sell and the audience available for our network programming and, therefore, its attractiveness to advertisers. Renewals of such agreements on less favorable terms may also adversely affect our results of operations through reductions of advertising revenue or increases in expenses.

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Disruptions or security breaches of our information technology infrastructure could interfere with our operations, compromise client information and expose us to liability, possibly causing our business and reputation to suffer.

Any internal technology error or failure impacting systems hosted internally or externally, or any large-scale external interruption in technology infrastructure we depend on, such as power, telecommunications or the Internet, may disrupt our business operations. Any individual, sustained or repeated failure of technology could negatively impact our operations and result in increased costs or reduced revenues. Our technology systems and related data also may be vulnerable to a variety of sources of interruption as a result of events beyond our control, including natural disasters, terrorist attacks, telecommunications failures, computer viruses, hackers and other security issues. While we have in place, and continue to invest in, technology security initiatives and disaster recovery plans, these measures may not be adequate or implemented properly to prevent a business disruption and its adverse financial impact and consequences to our business's reputation.

In addition, as a part of our ordinary business operations, we may collect and store sensitive data about advertisers, vendors or other business partners and personal information of our employees. The secure operation of the networks and systems on which this type of information is stored, processed and maintained is critical to our business operations and strategy. Any compromise of our technology systems resulting from attacks by hackers or breaches as a result of employee error or malfeasance could result in the loss, disclosure, misappropriation of or access to advertisers', vendors', employees' or business partners' information. Any such loss, disclosure, misappropriation or access could result in legal claims or proceedings, significant liability or regulatory penalties under laws protecting the privacy of personal information, disrupt operations and damage our reputation, any or all of which could have a material adverse effect on our business.

We are dependent on key personnel.

Our business is and is expected to continue to be managed by a small number of key management and operating personnel, and the loss of one or more of these individuals could have a material adverse effect on our business. We believe that our future success will depend in large part on our ability to attract and retain highly skilled and qualified personnel and to effectively train and manage our employee base. Although we have entered into employment and other retention agreements with some of our key management personnel that include provisions restricting their ability to compete with us under specified circumstances, we cannot be assured that all of those restrictions would be enforced if challenged in court.

We also from time to time enter into agreements with on-air personalities with large loyal audiences in their individual markets to protect our interests in those relationships that we believe to be valuable. The loss of one or more of these personalities could result in losses of audience share in that particular market which, in turn, could adversely affect revenues in that particular market.

Industry Risks

We operate in a very competitive business environment and a decrease in our ratings or market share would adversely affect our revenues.

The radio broadcasting industry is very competitive. The success of each of our stations depends largely upon rates it can charge for its advertising which, in turn, depends on, among other things, the audience ratings of the stations, the number of local advertising competitors and the overall demand for advertising within individual markets. These conditions are subject to change and highly susceptible to both micro- and macro-economic conditions.

Audience ratings and market shares fluctuate, and any adverse change in a particular market could have a material adverse effect on ratings and, consequently, the revenue of stations located in that market. While we already compete with other stations with comparable programming formats in many of our markets, any one of our stations could suffer a reduction in ratings or revenue and could require increased promotion and other expenses, and, consequently, could experience reduced operating results, if:

•another radio station in the market were to convert its programming format to a format similar to our station or launch aggressive promotional campaigns;

•a new station were to adopt a competitive format;

•we experience increased competition for advertising revenues from non-radio sources, including large scale online advertising platforms, such as Amazon, Facebook and Google;

•there is a shift in population, demographics, audience tastes and listening preferences or other factors beyond our control;

•an existing competitor were to strengthen its operations; or

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•any one or all of our stations were unable to maintain or increase advertising revenue or market share for any other reasons.

The Telecommunications Act of 1996 ("Telecom Act") opened up markets to competition by removing regulatory barriers to entry. The Telecom Act may allow for the further consolidation of ownership of radio broadcasting stations in markets in which we operate or may operate in the future, which could further increase competition in these markets. In addition, some competing owners may be larger and have substantially more financial and other resources than we do, which could provide them with certain advantages in competing against us. Any future relaxation of ownership rules by the FCC could further remove barriers to competition from local media companies who might purchase radio stations in our markets. As a result of all the foregoing, there can be no assurance that the competitive environment will not affect us, and that any one or all of our stations will be able to maintain or increase advertising revenue market share.

We must continue to respond to the rapid changes in technology, services and standards that characterize our industry in order to remain competitive. Our failure to timely or appropriately respond to any such changes could materially adversely affect our business and results of operations.

The radio broadcasting industry is subject to technological change, evolving industry standards and the emergence of other media technologies and services with which we compete for listeners and advertising dollars. We may not have the resources to acquire and deploy other technologies or to create or introduce new services that could effectively compete with these other technologies. Competition arising from other technologies or regulatory change may have a material adverse effect on us, and on the radio broadcasting industry as a whole. Various other audio technologies and services have been developed which compete for listeners and advertising dollars traditionally spent on radio advertising including:

◦personal digital audio and video devices (e.g. smart phones, tablets);

◦satellite delivered digital radio services that offer numerous programming channels such as Sirius Satellite Radio;

◦audio programming by internet content providers, internet radio stations such as Spotify and Pandora, cable systems, direct broadcast satellite systems and other digital audio broadcast formats;

◦low power FM radio stations, which are non-commercial FM radio broadcast outlets that serve small, localized areas;

◦applications that permit users to listen to programming on a time-delayed basis and to fast-forward through programming and/or advertisements (e.g. podcasts); and

◦search engine and e-commerce websites where a significant portion of their revenues are derived from advertising dollars such as Google, Facebook and Yelp.

These or other new technologies have the potential to change the means by which advertisers can reach target audiences most effectively. We cannot predict the effect, if any, that competition arising from these or other technologies or regulatory change may have on the radio broadcasting industry as a whole.

Financial Risks

The level and certain terms of our indebtedness could adversely affect our financial condition and impair our ability to operate our business.

Our debt agreements contain a number of significant covenants that could adversely affect Cumulus's ability to operate its businesses, as well as significantly affect its liquidity, and therefore could adversely affect Cumulus's results of operations. These covenants restrict (subject to certain exceptions) Cumulus's ability to: incur additional indebtedness; grant liens; consummate mergers, acquisitions, consolidations, liquidations and dissolutions; sell assets; make investments, loans and advances; make payments and modifications to subordinated and other material debt instruments; enter into transactions with affiliates; consummate sale-leaseback transactions; enter into hedging arrangements; allow third parties to manage its stations, and sell substantially all of the stations' programming or advertising; transfer or assign FCC licenses to third parties; and change its lines of business.

The breach of any covenants or obligations in our debt agreements, not otherwise waived or amended, could result in a default under the agreements and could trigger acceleration of those obligations. Any default under our debt could adversely affect Cumulus's financial condition, results of operations and ability to make payments on debt.

Certain of our variable debt uses the London Interbank Offered Rate ("LIBOR") as a benchmark for establishing the interest rate. The U.K. Financial Conduct Authority announced in 2017 that it intends to phase out LIBOR by the end of 2021. In addition, other regulators have suggested reforming or replacing other benchmark rates. The Alternative Reference Rates Committee, a group of market participants convened by the Federal Reserve Board and the Federal Reserve Bank of New York, has identified the Secured Overnight Financing Rate ("SOFR") as the recommend alternative to LIBOR. The selection of SOFR

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as the alternative reference rate, however, currently presents certain market concerns because a term structure for SOFR has not yet developed, and there is not yet a generally accepted methodology for adjusting SOFR.

The discontinuation, reform or replacement of LIBOR or any other benchmark rates may have an unpredictable impact on contractual mechanics in the credit markets or cause disruption to the broader financial markets. Uncertainty as to the nature of such potential discontinuation, reform or replacement may negatively impact the cost of our variable rate debt.

We have written off, and could in the future be required to write off a significant portion of the fair value of our FCC licenses, which may adversely affect our financial condition and results of operations.

As of December 31, 2020, our FCC licenses comprised 44.4% of our assets. Each year, and more frequently on an interim basis if appropriate, we are required by Accounting Standards Codification ("ASC") Topic 350, Intangibles — Goodwill and Other ("ASC 350"), to assess the fair value of our FCC broadcast licenses to determine whether the carrying amount of those assets is impaired. Significant judgments are required to estimate the fair value of these assets including estimating future cash flows, near-term and long-term revenue growth, and determining appropriate discount rates, among other assumptions. During the year ended December 31, 2020, we recorded a total impairment charge on our FCC licenses of $4.5 million which is recorded within Impairment of Intangible Assets within our Consolidated Statements of Operations. During the year ended December 31, 2019, we recorded a total impairment charge on our FCC licenses of $16.7 million of which approximately $15.6 million is recorded within Impairment of Intangible Assets and the remainder, which relates to an FCC license held for sale, is recorded within Impairment of Assets Held for Sale within our Consolidated Statements of Operations. Future impairment reviews could result in additional impairment charges. Any such impairment charges could materially adversely affect our financial results for the periods in which they are recorded.

We are exposed to credit risk on our accounts receivable. This risk is heightened during periods of uncertain economic conditions.

Our outstanding accounts receivable are not covered by collateral or credit insurance. While we have procedures to monitor and limit exposure to credit risk on our receivables, which risk is heightened during periods of uncertain economic conditions, there can be no assurance such procedures will effectively limit our credit risk and enable us to avoid losses, which could have a material adverse effect on our financial condition and operating results. We also maintain reserves to cover the uncollectibilty of a portion of our accounts receivable. There can be no assurance that such bad debt reserves will be sufficient.

We are a holding company with no material independent assets or operations and we depend on our subsidiaries for cash.

We are a holding company with no material independent assets or operations, other than our investments in our subsidiaries. Because we are a holding company, we are dependent upon the payment of dividends, distributions, loans or advances to us by our subsidiaries to fund our obligations. These payments could be or become subject to restrictions under applicable laws in the jurisdictions in which our subsidiaries operate. Payments by our subsidiaries are also contingent upon the subsidiaries' earnings. If we are unable to obtain sufficient funds from our subsidiaries to fund our obligations, our financial condition and ability to meet our obligations may be adversely affected.

Legal and Regulatory Risks

The broadcasting industry is subject to extensive and changing federal regulation.

The radio broadcasting industry is subject to extensive regulation by the FCC under the Communications Act. We are required to obtain licenses from the FCC to operate our stations. Licenses are normally granted for a term of eight years and are renewable. Although the vast majority of FCC radio station licenses are routinely renewed, we cannot assure you that the FCC will grant our existing or future renewal applications or that the renewals will not include conditions out of the ordinary course. The non-renewal, or renewal with conditions, of one or more of our licenses could have a material adverse effect on us.

We must also comply with the extensive FCC regulations and policies on the ownership and operation of our radio stations. FCC regulations limit the number of radio stations that a licensee can own in a market, which could restrict our ability to acquire radio stations that could be material to our overall financial performance or our financial performance in a particular market.

The FCC also requires radio stations to comply with certain technical requirements to limit interference between two or more radio stations. Despite those limitations, a dispute could arise whether another station is improperly interfering with the operation of one of our stations or another radio licensee could complain to the FCC that one our stations is improperly

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interfering with that licensee's station. There can be no assurance as to how the FCC might resolve such a dispute. These FCC regulations and others may change over time, and we cannot assure you that those changes would not have a material adverse effect on our business and results of operations.

Legislation and regulation of digital media businesses, including privacy and data protection regimes, could create unexpected costs, subject us to enforcement actions for compliance failures, or cause us to change our digital media technology platform or business model.

U.S. and foreign governments have enacted, considered or are currently considering legislation or regulations that relate to digital advertising, including, for example, regulations related to the online collection and use of anonymous user data and unique device identifiers, such as Internet Protocol addresses ("IP address"), unique mobile device identifiers or geo-location data and other privacy and data protection regulation. Such legislation or regulations could affect the costs of doing business online, and could reduce the demand for our digital solutions or otherwise harm our digital operations. For example, a wide variety of state, national and international laws and regulations apply to the collection, use, retention, protection, disclosure, transfer and other processing of personal data. While we take measures to protect the security of information that we collect, use and disclose in the operation of our business, such measures may not always be effective. Data protection and privacy-related laws and regulations are evolving and could result in ever-increasing regulatory and public scrutiny and escalating levels of enforcement and sanctions. In addition, it is possible that these laws and regulations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules or our business practices. Any failure, or perceived failure, by us to comply with U.S. federal, state, or international laws, including laws and regulations governing privacy, data security or consumer protection, could result in proceedings against us by governmental entities, consumers or others. Any such proceedings could force us to spend significant amounts in defense of these proceedings, distract our management, result in fines or require us to pay significant monetary damages, damage our reputation, adversely affect the demand for our services, increase our costs of doing business or otherwise cause us to change our business practices or limit or inhibit our ability to operate or expand our digital operations.

The FCC has been vigorous in its enforcement of its rules and regulations, including its indecency, sponsorship identification and EAS rules, violations of which could have a material adverse effect on our business.

The Company is subject to many rules and regulations that govern the operations of its radio stations, and these rules may change from time to time. The FCC has previously imposed, or sought to impose, fines on the Company, such as a $540,000 penalty imposed on us in early 2016 for sponsorship identification violations occurring in 2011, nearly all of which occurred prior to the Company's ownership of the station and continued for approximately one month thereafter. In 2018, we informed the FCC of potential sponsorship identification violations regarding certain of our stations, and in August 2019, the FCC imposed a fine of $233,000 with respect to those violations. The FCC also has shortened the license renewal terms for certain of our radio stations in response to rule violations. It also is not uncommon for a radio station and the FCC to seek to settle alleged rule violations prior to the issuance of an order that would impose fines and other penalties, but such settlements or consent decrees usually result in the station owner paying money to the FCC. Notwithstanding the efforts by the Company to prevent violations of FCC rules and regulations, however, it is likely that the Company will continue to be subject to such penalties (whether through the issuance of orders by the FCC or the execution of settlement agreements) given the number of radio stations owned and operated by the Company, and those penalties could be substantial.

FCC regulations prohibit the broadcast of "obscene" material at any time, and "indecent" material between the hours of 6:00 a.m. and 10:00 p.m. The FCC has historically enforced licensee compliance in this area through the assessment of monetary forfeitures. Such forfeitures may include: (i) imposition of the maximum authorized fine for egregious cases ($419,353 for a single violation, up to a maximum of $3,870,946 for a continuing violation); and (ii) imposition of fines on a per utterance basis instead of a single fine for an entire program. While we have no knowledge of any pending complaints before the FCC alleging that obscene or indecent material has been broadcast on any of our stations, such complaints may have been, or in the future may be, filed against our stations.

The FCC increased its enforcement of regulations requiring a radio station to include an on-air announcement which identifies the sponsor of all advertisements and other matter broadcast by any radio station for which any money, service or other valuable consideration is received. Fines for such violations can be substantial as they are dependent on the number of times a particular advertisement is broadcast. In addition, the FCC has recently increased its enforcement with respect to failure to comply with requirements regarding the maintenance of public inspection files for each radio station, which are maintained on an FCC database and therefore are easily accessible by members of the public and the FCC. Similarly, the FCC has recently sought to impose substantial fines on broadcasters who transmit Emergency Alert System ("EAS") codes, or simulations thereof, in the absence of an actual emergency or authorized test of the EAS. In 2014, for instance, the FCC imposed a fine of

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$1.9 million on three media companies, in 2015, it imposed a fine of $1 million on a radio broadcaster, and in 2019, it imposed a fine of $395,000 on a television network, in each case based on a determined misuse of EAS tones.

The Company is currently subject to, and may become subject to new, FCC inquiries or proceedings related to our stations' broadcasts or operations. We cannot predict the outcome of such inquiries and proceedings, but to the extent that such inquiries or proceedings result in the imposition of fines (alone or in the aggregate), a settlement with the FCC, revocation of any of our station licenses or denials of license renewal applications, our results of operations and business could be materially adversely affected.

Legislation could require radio broadcasters to pay additional royalties, including to additional parties such as record labels or recording artists.

We currently pay royalties to song composers and publishers through BMI, ASCAP, SESAC and GMR but not to record labels or recording artists for exhibition or use of over the air broadcasts of music. From time to time, Congress considers legislation which could change the copyright fees and the procedures by which the fees are determined and the entities to whom fees must be paid. Such legislation historically has been the subject of considerable debate and activity by the broadcast industry and other parties affected by the proposed legislation. It cannot be predicted whether any proposed future legislation will become law or what impact it would have on our results from operations, cash flows or financial position.

Risks Related to Ownership of Our Class A Common Stock

The public market for our Class A Common Stock may be volatile.

The market price for our Class A common stock could be subject to wide fluctuations as a result of such factors as:

•the total number of shares of Class A common stock available to trade and the low trading volume of the stock;

•the total amount of our indebtedness and our ability to service that debt;

•conditions and trends in the radio broadcasting industry;

•actual or anticipated variations in our operating results, including audience share ratings and financial results;

•estimates of our future performance and/or operations;

•changes in financial estimates by securities analysts;

•technological innovations;

•competitive developments;

•adoption of new accounting standards affecting companies in general or affecting companies in the radio broadcasting industry in particular; and

•general market conditions and other factors.

Further, the stock markets, and in particular the NASDAQ Global Market, the market on which our Class A common stock is listed, from time to time have experienced extreme price and volume fluctuations that were not necessarily related or proportionate to the operating performance of the affected companies. In addition, general economic, political and market conditions such as recessions, interest rate movements or international currency fluctuations, may adversely affect the market price of our Class A common stock.

The rights plan adopted by our Board may impair a takeover attempt.

On May 20, 2020, our Board adopted a rights plan and declared a dividend of (a) one Class A right (a "Class A Right") in respect of each share of the Company's Class A common stock, par value $0.0000001 per share (the "Class A Common Shares"), (b) one Class B right (a "Class B Right") in respect of each share of the Company's Class B common stock, par value $0.0000001 per share (the "Class B Common Shares" and together with the Class A Common Shares, the "Common Shares"), (c) one Series 1 warrant right (a "Series 1 Warrant Right") in respect of each of the Company's Series 1 warrants (the "Series 1 Warrants"), and (d) one Series 2 warrant right (a "Series 2 Warrant Right," and together with the Class A Rights, the Class B Rights and the Series 1 Warrant Rights, the "Rights") in respect of each of the Company's Series 2 warrants (the "Series 2 Warrants," and together with the Series 1 Warrants, the "Warrants"). The dividend distribution was made on June 1, 2020 to the Company's stockholders and Warrant holders of record on that date. In the event that a person or group that is or becomes the beneficial owner of 10% or more of the Company's outstanding Class A Common Shares (20% or more in the case of a passive institutional investor), subject to certain exceptions, (a) each Class A Right would allow its holder to purchase from the Company one one-hundredth of a Class A Common Share for a purchase price of $25.00, (b) each Class B Right would allow its holder to purchase from the Company one one-hundredth of a Class B Common Share for a purchase price of $25.00, (c)

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each Series 1 Warrant Right would allow its holder to purchase from the Company one one-hundredth of a Series 1 Warrant for a purchase price of $25.00, and (d) each Series 2 Warrant would allow its holder to purchase from the Company one one-hundredth of a Series 2 Warrant for a purchase price of $25.00.

In addition, after a person or group has become a beneficial owner of 10% or more of the Company's outstanding Class A Common Shares (20% or more in the case of a passive institutional investor), but before any person beneficially owns 50% or more of the Company’s outstanding Class A Common Shares, the Board may exchange each Right (other than Rights that have become null and void) at an exchange ratio of (a) one Class A Common Share per Class A Right, (b) one Class B Common Share per Class B Right, (c) one Series 1 Warrant per Series 1 Warrant Right, and (d) one Series 2 Warrant per Series 2 Warrant Right. The shareholder rights plan could make it more difficult for a third party to acquire the Company or a large block of our Common Shares without the approval of our Board. Unless earlier redeemed or exchanged, the Rights will expire on April 30, 2021.

Cautionary Statement Regarding Forward-Looking Statements

This Form 10-K contains and incorporates by reference "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (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," "contemplates," "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 Cumulus and its directors and officers with respect to, among other things, future events, financial results and financial trends expected to impact Cumulus.

Such forward-looking statements are and will be, as the case may be, subject to change and subject to many risks, uncertainties and other factors relating to our operations and business environment, which may cause our actual results 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 impact of the COVID-19 global pandemic and related measures taken by governmental or regulatory authorities to

combat the global pandemic, including the impact of the global pandemic on our results of operations, financial

condition and liquidity;

•our achievement of certain expected revenue results, including as a result of factors or events that are unexpected or otherwise outside of our control;

•our ability to generate sufficient cash flows to service our debt and other obligations and our ability to access capital, including debt or equity;

•general economic or business conditions affecting the radio broadcasting industry which may be less favorable than expected, decreasing spending by advertisers;

•changes in market conditions which could impair our intangible assets and the effects of any material impairment of our intangible assets;

•our ability to execute our business plan and strategy;

•our ability to attract, motivate and/or retain key executives and associates;

•increased competition in the radio broadcasting industry and our ability to respond to changes in technology in order to remain competitive;

•shift in population, demographics, audience tastes and listening preferences;

•disruptions or security breaches of our information technology infrastructure;

•the impact of current, pending or future legislation and regulations, antitrust considerations, and pending or future litigation or claims;

•changes in regulatory or legislative 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 interest rates;

•the possibility that we may be unable to achieve any expected cost-saving or operational synergies in connection with any acquisitions or business improvement initiatives, or achieve them within the expected time periods; and

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•other risks and uncertainties referenced from time to time in this Form 10-K and other filings of ours with the SEC or not currently known to us or that we do not currently deem to be material.

Many of these factors are beyond our control or are difficult to predict, and their ultimate impact could be material. We caution you not to place undue reliance on any forward-looking statements, which speak only as of the date of this Form 10-K. Except as may be required by law, we do not undertake any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

The types of properties required to support each of our radio stations include studios, sales offices, and tower sites. A station's studios are generally housed with its offices in a business district within the station's community of license or largest nearby community. The tower sites are generally located in an area to provide maximum market coverage.

We own properties throughout our markets and also lease additional studio, office facilities, and tower sites in support of our business operations. We also lease corporate office space in Atlanta, Georgia, and office space in New York, New York; Dallas, Texas; Denver, Colorado and Los Angeles, California for the production and distribution of our radio network. We own substantially all of our equipment used in operating our stations and network, consisting principally of transmitting antennae, transmitters, studio equipment, and general office equipment.

We believe that our properties are generally in good condition and suitable for our operations; however, our studios, office space and transmission facilities require periodic maintenance and refurbishment.

Item 3. Legal Proceedings

In August 2015, the Company was named as a defendant in two separate putative class action lawsuits relating to its use and public performance of certain sound recordings fixed prior to February 15, 1972 (the "Pre-1972 Recordings"). The first suit, ABS Entertainment, Inc., et. al. v, Cumulus Media Inc., was filed in the U.S. District Court for the Central District of California and alleged, among other things, copyright infringement under California state law, common law conversion, misappropriation and unfair business practices. On December 11, 2015, this suit was dismissed without prejudice. The second suit, ABS Entertainment, Inc., v. Cumulus Media Inc., was filed in the U.S. District Court for the Southern District of New York and claimed, among other things, common law copyright infringement and unfair competition. The New York lawsuit was stayed pending an appeal before the Second Circuit involving unrelated third parties over whether the owner of a Pre-1972 Recording holds an exclusive right to publicly perform that recording under New York common law. On December 20, 2016, the New York Court of Appeals held that New York common law does not recognize a right of public performance for owners of pre-1972 Recordings. As a result of that case (to which Cumulus Media Inc. was not a party) the New York case against Cumulus Media Inc., was voluntarily dismissed by the plaintiffs on April 3, 2017. On October 11, 2018, President Trump signed the Orrin G. Hatch-Bob Goodlatte Music Modernization Act (the "Music Modernization Act") into law, which, among other things, provides new federal rights going forward for owners of pre-1972 Recordings. The question of whether public performance rights existed for Pre-1972 recordings under state law prior to the enactment of the new Music Modernization Act is still being litigated in the Ninth Circuit as a result of a case filed in California. The Company is not a party to that case, and is not yet able to determine what effect that proceeding will have, if any, on its financial position, results of operations or cash flows.

On February 24, 2020, two individual plaintiffs filed a putative class action lawsuit against the Company in the U.S. District Court for the Northern District of Georgia alleging claims regarding the Cumulus Media Inc. 401(k) Plan (the "Plan").  The case alleges that the Company breached its fiduciary duties under the Employee Retirement Income Security Act of 1974 (ERISA) in the oversight of the Plan, principally by selecting and retaining certain investment options despite their higher fees and costs than other available investment options, causing participants in the Plan to pay excessive recordkeeping fees, and by failing to monitor other fiduciaries. The plaintiffs seek unspecified damages on behalf of a class of Plan participants from February 24, 2014 through the date of any judgment. On May 28, 2020, the Company filed a motion to dismiss the complaint. On December 17, 2020 the Court entered an order dismissing one of the individual plaintiffs and all claims against the Company except those that arose on or after February 24, 2019 (i.e., one year prior to the filing of the Complaint). The Company intends to continue to defend the case vigorously. The Company is currently unable to reasonably estimate what effect the ultimate outcome might have, if any, on its financial position, results of operations or cash flows. 

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On September 28, 2020, Westwood One and the National Collegiate Athletic Association and NIT, LLC (collectively "the NCAA"), filed competing lawsuits in the Indiana Commercial Court in Indianapolis, Indiana (the "Court"), with regard to the terms of that certain Radio Agreement between the parties dated January 13, 2011 (the "Radio Agreement"), that granted Westwood One exclusive rights to produce and distribute audio broadcasts for all NCAA and NIT championship events during the term of that agreement. Both lawsuits relate to annual rights fees applicable to championship events under the Rights Agreement that were cancelled in 2020 due to the COVID-19 pandemic and the subsequent termination of the Rights Agreement by the NCAA. The complaint filed by the NCAA alleges a breach of the Radio Agreement by Westwood One for non-payment of certain fees related to the events that were canceled and requests, among other things, a declaratory ruling that the termination of the Radio Agreement by the NCAA was permissible and that the NCAA is entitled to full payment of the annual rights fees under the Radio Agreement for the 2019-2020 contract year despite the cancellation of certain events. Westwood One filed its complaint seeking, among other things, a declaratory ruling that Westwood One was not obligated to pay the disputed annual rights fees due to the cancellation of the relevant events and that the NCAA was prohibited from terminating the Radio Agreement for such non-payment, and also requested a preliminary injunction seeking to enjoin the NCAA from terminating the Radio Agreement until the Court could make a determination on the issues raised by the lawsuits. By order dated October 23, 2020, the Court denied Westwood One's motion for preliminary injunction, but did not reach a conclusion on the merits of Westwood One's request for a declaratory ruling. On October 23, 2020, Westwood One filed an appeal of the Court's denial of its motion for preliminary injunction and intends to litigate both the NCAA lawsuit and the Westwood One lawsuit to conclusion. Notwithstanding the foregoing, Westwood One and the NCAA have entered into an agreement granting Westwood One exclusive rights to produce and distribute audio broadcasts of the 2020-21 college basketball season, including the NCAA championship event currently scheduled for April 2021. The Company is currently unable to reasonably estimate what effect the ultimate outcome of this litigation might have, if any, on its financial position, results of operations or cash flows.

The Company currently is, and expects that from time to time in the future it will be, party to, or a defendant in, various other claims or lawsuits (the "Other Claims") that are generally incidental to its business. The Company expects that it will vigorously contest any Other Claims and, although we are unable to reasonably estimate what effect the ultimate resolution of any known Other Claims might have, the Company does not believe that the ultimate resolution of any known Other Claims would have a material adverse effect on the Company's financial position, results of operations or cash flows.

Item 4. Mine Safety Disclosures

Not applicable.

PART II

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information for Common Stock

Our Class A common stock is listed on the NASDAQ Global Market under the symbol "CMLS." Shares of our Class B common stock are not publicly traded, but they are convertible on a share-for-share basis into Class A common stock. As of February 16, 2021, there were approximately 232 holders of record of our Class A common stock and 96 holders of record of our Class B common stock. The number of holders of our Class A common stock does not include any estimate of the number of beneficial holders whose shares may be held of record by brokerage firms or clearing agencies.

Dividends

We have not declared or paid any cash dividends on our common stock since our inception and do not currently have any plans to pay any cash dividends on our common stock. Also, we are currently subject to certain restrictions under the terms of our credit agreements with respect to the payment of dividends. For a more detailed discussion of the restrictions in our credit agreements, see Note 7, "Long-Term Debt" in the accompanying audited consolidated financial statements included elsewhere in this Form 10-K.

Securities Authorized for Issuance Under Equity Compensation Plans

The information required by Item 201(d) of Regulation S-K is set forth under "Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters" of this Form 10-K which information is incorporated herein by reference.

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Item 6. Selected Financial Data

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

General Overview

The following discussion of our financial condition and results of operations should be read in conjunction with the other information contained in this Form 10-K, including our consolidated financial statements and notes thereto beginning on page F-2 in this Form 10-K, as well as the information set forth in Item 1A, "Risk Factors." This discussion, as well as various other sections of this Annual Report, contains and refers to statements that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Such statements are any statements other than those of historical fact and relate to our intent, belief or current expectations primarily with respect to our future operating, financial and strategic performance. Any such forward-looking statements are not guarantees of future performance and may involve risks and uncertainties. Actual results may differ from those contained in or implied by the forward-looking statements as a result of various factors. For more information, see "Cautionary Statement Regarding Forward-Looking Statements" within Item 1A, "Risk Factors."

For additional information about certain of the matters discussed and described in the following Management's Discussion and Analysis of Financial Condition and Results of Operations, including certain defined terms used herein, see the notes to the accompanying audited consolidated financial statements included elsewhere in this Form 10-K.

Our Business and Operating Overview

CUMULUS MEDIA is a leading audio-first media and entertainment company delivering premium content to over a quarter billion people every month - wherever and whenever they want it. CUMULUS MEDIA engages listeners with high-quality local programming through 415 owned and operated stations across 86 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, CNN, the AP, the Academy of Country Music Awards, and many other world-class partners across nearly 7,300 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. CUMULUS MEDIA provides advertisers with personal connections, local impact and national reach through broadcast and on-demand digital, mobile, social, and voice-activated platforms, as well as integrated digital marketing services, powerful influencers, full-service audio solutions, industry-leading research and insights, and live event experiences. CUMULUS MEDIA is the only audio media company to provide marketers with local and national advertising performance guarantees.

Our primary source of revenue is the sale of advertising time. Our sales of advertising time are primarily affected by the demand from local, regional and national advertisers, which also impacts the advertising rates we charge. Advertising demand and rates are based primarily on the ability to attract audiences in the demographic groups targeted by such advertisers, as measured principally by various ratings agencies on a periodic basis. We endeavor to provide compelling programming and form connections between our on-air talent and listeners in order to develop strong listener loyalty, and we believe that the diversification of our formats and programs, including non-music formats and proprietary content, helps to insulate us from the effects of changes in the musical tastes of the public with respect to any particular format.

We strive to maximize revenue by managing our on-air inventory of advertising time and adjusting prices based on supply and demand. The optimal number of advertisements available for sale depends on the programming format of a particular radio program. Each program has a general target level of on-air inventory available for advertising. This target level of advertising inventory may vary at different times of the day but tends to remain stable over time. We seek to broaden our base of advertisers in each of our markets by providing a wide array of audience demographic segments across each cluster of stations, thereby providing potential advertisers with an effective means to reach a targeted demographic group. Our advertising contracts are generally short-term.

We generate revenue across the following three major revenue streams:

Broadcast radio revenue. Most of our revenue is generated through the sale of terrestrial, broadcast radio advertising time to local, regional, and national clients. Local spot and regional spot advertising is sold by Cumulus employed sales personnel. National spot advertising for our owned and operated stations is marketed and sold by Katz Media Group, Inc. in an outsourced arrangement as well as our own internal national sales team.

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In addition to local, regional and national spot advertising revenues, we monetize our available inventory in the network sales marketplace. To effectively deliver network advertising for our customers, we distribute content and programming through third party affiliates in order to reach a broader national audience. Typically, in exchange for the right to broadcast radio network programming, third party affiliates remit a portion of their advertising time to us, which is then aggregated into packages focused on specific demographic groups and sold by us to our advertiser clients that want to reach those demographic groups on a national basis. Network advertising airing across our owned, operated and affiliated stations is sold by our internal sales team located across the U.S. to predominantly national and regional advertisers.

Digital revenue. We generate digital advertising revenue from the sale of advertising and promotional opportunities across our streaming audio network, podcasting network, websites, mobile applications and digital marketing services. We operate one of the largest streaming audio advertising networks in the U.S., including owned and operated internet radio simulcasted stations with either digital ad-inserted or simulcasted ads. We sell display ads across more than 400 local radio station websites, mobile applications, and ancillary custom client microsites. We also sell premium advertising adjacent to, or embedded in, podcasts through our network of owned and distributed podcasts. In addition, we sell an array of digital marketing services such as, email marketing, geo-targeted display and video solutions, website and microsite building and hosting, social media management, reputation management and search engine marketing and optimization within our Cumulus C-Suite digital marketing solutions portfolio to existing and new advertisers.

Other. All non-advertising based revenue types in which the Company participates are aggregated in our Other revenue category. This includes fees we receive for content licensing, revenues from our digital commerce platform, subleases and rents, proprietary software licensing, and all other revenue.

We continually evaluate opportunities to increase revenues through new platforms, including technology-based initiatives. As a result of those revenue increasing opportunities, our operating results in any period may be affected by the incurrence of advertising and promotion expenses that typically do not have an effect on revenue generation until future periods, if at all. In addition, as part of this evaluation we also from time to time reorganize and discontinue certain redundant and/or unprofitable content vehicles across our platform which we expect will impact our broadcast revenues in the future.

Seasonality and Cyclicality

Our advertising revenues vary by quarter throughout the year. As is typical with advertising revenue supported businesses, our first calendar quarter typically produces the lowest revenues of any quarter during the year, as advertising generally declines following the winter holidays. The second and fourth calendar quarters typically produce the highest revenues for the year. In addition, our revenues tend to fluctuate between years, consistent with, among other things, increased advertising expenditures in even-numbered years by political candidates, political parties and special interest groups. This political spending typically is heaviest during the fourth quarter.

Non-GAAP Financial Measure

From time to time we utilize certain financial measures that are not prepared or calculated in accordance with generally accepted accounting principles in the U.S. ("GAAP") to assess our financial performance and profitability. Consolidated adjusted earnings before interest, taxes, depreciation, and amortization ("Adjusted EBITDA") is the financial metric by which management and the chief operating decision maker allocate resources of the Company and analyze the performance of the Company as a whole. Management also uses this measure to determine the contribution of our core operations to the funding of our corporate resources utilized to manage our operations and our non-operating expenses including debt service and acquisitions. In addition, consolidated Adjusted EBITDA is a key metric for purposes of calculating and determining our compliance with certain covenants contained in our Refinanced Credit Agreement.

In determining Adjusted EBITDA, we exclude the following from net income: interest, taxes, depreciation, amortization, stock-based compensation expense, gain or loss on the exchange, sale, or disposal of any assets or stations or on the early extinguishment of debt, local marketing agreement fees, expenses relating to acquisitions, divestitures, restructuring costs, reorganization items and non-cash impairments of assets, if any.

Management believes that Adjusted EBITDA, although not a measure that is calculated in accordance with GAAP, is commonly employed by the investment community as a measure for determining the market value of a media company and comparing the operational and financial performance among media companies. Management has also observed that Adjusted EBITDA is routinely utilized to evaluate and negotiate the potential purchase price for media companies. Given the relevance to our overall value, management believes that investors consider the metric to be extremely useful.

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Adjusted EBITDA should not be considered in isolation or as a substitute for net income, operating income, cash flows from operating activities or any other measure for determining our operating performance or liquidity that is calculated in accordance with GAAP. In addition, Adjusted EBITDA may be defined or calculated differently by other companies, and comparability may be limited.

Consolidated Results of Operations

Analysis of Consolidated Statements of Operations

The following selected data from our audited Consolidated Statements of Operations and other supplementary data provides information that our management believes is relevant to an assessment and understanding of our results of operations and financial condition. This discussion should be read in conjunction with our audited Consolidated Statements of Operations and notes thereto appearing elsewhere herein (dollars in thousands).

	Year ended December 31, 2020		Year Ended December 31, 2019		2020 vs 2019 Change
					$		%
STATEMENT OF OPERATIONS DATA:
Net revenue	$	816,218	$	1,113,445	$	(297,227)	-26.7	%
Content costs	337,078		405,653		(68,575)		-16.9	%
Selling, general & administrative expenses	367,695		461,218		(93,523)		-20.3	%
Depreciation and amortization	52,290		52,554		(264)		-0.5	%
Local marketing agreement fees	3,149		3,500		(351)		-10.0	%
Corporate expenses	49,199		57,988		(8,789)		-15.2	%
Loss (gain) on sale of assets or stations	8,761		(55,403)		64,164		N/A
Impairment of assets held for sale	—		6,165		(6,165)		-100.0	%
Impairment of capitalized software development costs	4,139		—		4,139		100.0	%
Impairment of intangible assets	4,509		15,563		(11,054)		-71.0	%
Operating (loss) income	(10,602)		166,207		(176,809)		N/A
Interest expense	(68,099)		(82,916)		14,817		-17.9	%
Interest income	6		25		(19)		-76.0	%
Gain on early extinguishment of debt	—		381		(381)		-100.0	%
Other expense, net	(273)		(177)		(96)		54.2	%
Loss (income) before income taxes	(78,968)		83,520		(162,488)		N/A
Income tax benefit (expense)	19,249		(22,263)		41,512		N/A
Net (loss) income	$	(59,719)	$	61,257	$	(120,976)	N/A
OTHER DATA:
Adjusted EBITDA	$	81,257	$	212,988	$	(131,731)	-61.8	%

Year Ended December 31, 2020 compared to the Year Ended December 31, 2019

Net Revenue

Net revenue for the year ended December 31, 2020 compared to Net revenue for the year ended December 31, 2019 decreased primarily as broadcast advertising revenue and trade and barter revenue were negatively impacted by COVID-19. These reductions were slightly offset by increases in political revenue resulting from the election cycle and digital revenue growth.

Content Costs

Content costs consist of all costs related to the licensing, acquisition and development of our programming. Content costs for the year ended December 31, 2020 compared to Content costs for the year ended December 31, 2019 decreased primarily as a result of the reduction in personnel costs, both internally and externally, related to cost-saving actions and station

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dispositions, the cancellation or postponement of sporting events resulting from COVID-19 and a reduction in our music licensing fees attributed to lower revenue.

Selling, General & Administrative Expenses

Selling, general and administrative expenses consist of expenses related to our sales efforts and distribution of our content across our platform and overhead in our markets. Selling, general and administrative expenses for the year ended December 31, 2020 compared to Selling, general and administrative expenses for the year ended December 31, 2019 decreased primarily as a result of the reduction in personnel costs, both internally and externally, related to cost mitigation efforts and station dispositions, declines in local and national commissions as a result of lower local and national broadcast revenue, lower trade and event-related expenses as a result of the cancellation or postponement of sporting, music, and various promotional events resulting from COVID-19, lower incentive accruals based on Company performance, and lower rent expense as a result of exiting certain facilities. These declines were slightly offset by an increase in bad debt expense.

Depreciation and Amortization

Depreciation and amortization for the year ended December 31, 2020 compared to Depreciation and amortization for the year ended December 31, 2019 decreased because certain definite-lived intangibles were fully amortized by the first quarter of 2020, which was mostly offset by an increase in depreciation expense as a result of additional fixed assets being placed into service during 2020.

Local Marketing Agreement Fees

Local marketing agreements are those agreements under which one party programs a radio station on behalf of another party. LMA fees for the year ended December 31, 2020 compared to LMA fees for the year ended December 31, 2019 decreased as the Company ceased programming for KESN-FM under the LMA agreement which ended in October 2020 and the contractual rates for the other LMA agreement decreased year over year. Additionally, during 2019, the Company received fees from a LMA with Meruelo Media to program KLOS-FM which ended in July 2019.

Corporate Expenses

Corporate expenses consist primarily of compensation and related costs for our executive, accounting, finance, human resources, information technology and legal personnel, and fees for professional services. Professional services are principally comprised of audit, consulting and outside legal services. Corporate expenses also include restructuring expenses and stock-based compensation expense. Corporate expenses for the year ended December 31, 2020 compared to Corporate expenses for the year ended December 31, 2019 decreased primarily as a result of lower incentive and stock-based compensation driven by Company performance and lower restructuring expense which were slightly offset by an increase in professional fees.

Loss (Gain) on Sale or Disposal of Assets or Stations

The Loss on sale or disposal of assets or stations for the year ended December 31, 2020 of $8.8 million was primarily a result of the sale of certain land located in Bethesda, MD used in conjunction with the Company's Washington, D.C. operations to Toll Brothers (the "DC Land"), fixed asset dispositions related to the exit of certain facilities and the sale of WABC-AM in New York, NY to Red Apple Media, Inc. (the "WABC Sale"). See Note 2, "Acquisitions and Dispositions," in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for further discussion of the WABC Sale and the sale of the DC Land.

The Gain on sale or disposal of assets or stations for the year ended December 31, 2019 of $55.4 million included a $47.6 million gain on the sale of six radio stations, WYAY-FM (Atlanta, GA), WPLJ-FM (New York, NY), KFFG-FM (San Francisco, CA), WZAT-FM (Savannah, GA), WXTL-FM (Syracuse, NY), and WRQX-FM (Washington, DC), to Educational Media Foundation (the "EMF Sale") and a $10.5 million gain on the sale of KLOS-FM in Los Angeles, CA to Meruelo Media (the "KLOS-FM Sale") partially offset by a $2.2 million loss related to the swap agreement with Entercom ("Entercom Swap"). See Note 2, "Acquisitions and Dispositions" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for further discussion of the EMF Sale, KLOS-FM Sale and Entercom Swap.

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Impairment of Assets Held for Sale

The impairment of assets held for sale for the year ended December 31, 2019 resulted primarily from a $5.0 million adjustment of the purchase price for the DC Land. In addition, as a result of the annual impairment test of our FCC licenses, we recorded a $1.2 million impairment of the WABC FCC license. See Note 4, "Property and Equipment" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for further discussion of the DC Land and WABC FCC license impairments, respectively.

Impairment of Capitalized Software Development Costs

The Company's strategic reassessment of a customized technology project resulted in a $4.1 million impairment of capitalized internally developed software costs for the year ended December 31, 2020. See Note 4, "Property and Equipment" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for further discussion.

Impairment of Intangible Assets

The impairment of intangible assets for the year ended December 31, 2020 of $4.5 million resulted from the interim impairment test of our FCC licenses. The impairment of intangible assets for the year ended December 31, 2019 of $15.6 million resulted from the annual impairment test of our FCC licenses. See Note 5, "Intangible Assets" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for further discussion.

Interest Expense

Total interest expense for the year ended December 31, 2020 decreased as compared to total interest expense for the year ended December 31, 2019. The below table details the components of our interest expense by debt instrument (dollars in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019		$ Change
Term Loan due 2022	$	—	$	51,332	$	(51,332)
Term Loan due 2026	25,682		7,925		17,757
6.75% Senior Notes	33,237		17,344		15,893
2020 Revolving Credit Facility	812		—		812
Other, including debt issue cost amortization and write-off	8,368		6,315		2,053
Interest expense	$	68,099	$	82,916	$	(14,817)

Income Tax Benefit (Expense)

For the year ended December 31, 2020, we recorded an income tax benefit of $19.2 million on pre-tax book loss of $79.0 million. The income tax benefit recorded for the year ended December 31, 2020 was primarily the result of federal, state and local income taxes.

For the year ended December 31, 2019, we recorded income tax expense of $22.3 million on pre-tax book income of $83.5 million. The income tax expense recorded for the year ended December 31, 2019 was primarily the result of federal, state and local income taxes.

Adjusted EBITDA

As a result of the factors described above, Adjusted EBITDA for the year ended December 31, 2020 compared to Adjusted EBITDA for the year ended December 31, 2019 decreased.

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Reconciliation of Non-GAAP Financial Measure

The following table reconciles Adjusted EBITDA to net (loss) income (the most directly comparable financial measure calculated and presented in accordance with GAAP) as presented in the accompanying consolidated statements of operations (dollars in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
GAAP net (loss) income	$	(59,719)	$	61,257
Income tax (benefit) expense	(19,249)		22,263
Non-operating expenses, including net interest expense	68,366		83,068
Local marketing agreement fees	3,149		3,500
Depreciation and amortization	52,290		52,554
Stock-based compensation expense	3,337		5,301
Loss (gain) on sale of assets or stations	8,761		(55,403)
Impairment of assets held for sale	—		6,165
Impairment of capitalized software development costs	4,139		—
Impairment of intangibles	4,509		15,563
Restructuring costs	14,859		18,315
Franchise taxes	815		786
Gain on early extinguishment of debt	—		(381)
Adjusted EBITDA	$	81,257	$	212,988

Segment Results of Operations

The Company has one reportable segment and presents the comparative periods on a consolidated basis to reflect the one reportable segment.

Liquidity and Capital Resources

As of December 31, 2020 and 2019, we had $271.8 million and $17.0 million, respectively, of cash and cash equivalents, including restricted cash. We generated cash from operating activities of $33.2 million and $104.3 million, respectively, for the years ended December 31, 2020 and 2019.

    Historically, our principal sources of funds have been cash flow from operations and borrowings under credit facilities in existence from time to time. Our cash flow from operations remains subject to factors such as fluctuations in advertising media preferences and changes in demand caused by shifts in population, station listenership, demographics and audience tastes, some of which may be exacerbated by the COVID-19 pandemic. In addition, our cash flows may be affected if customers are not able to pay, or delay payment of, accounts receivable that are owed to us, which risks may also be exacerbated in challenging or otherwise uncertain economic periods. In certain periods, the Company has experienced reductions in revenue and profitability from prior historical periods because of market revenue pressures and cost escalations built into certain contracts. Notwithstanding this, we believe that our national platform and extensive station portfolio representing a broad diversity in format, listener base, geography, and advertiser base help us maintain a more stable revenue stream by reducing our dependence on any single demographic, region or industry. However, future reductions in revenue or profitability are possible and could have a material adverse effect on the Company’s business, results of operations, financial condition or liquidity.

Although there is uncertainty related to the anticipated impact of the COVID-19 pandemic on the Company's future results, we believe our business model, our current cash reserves and the recent steps we have taken to strengthen our balance sheet, such as the Tower Sale (as defined below), sale of the DC Land and $60 million draw under our 2020 Revolving Credit Facility (as defined below), will help us manage our business and anticipated liquidity needs. See Note 2, "Acquisitions and Dispositions," in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for further discussion of the Tower Sale and the sale of the DC Land.

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We continually monitor our capital structure, and from time to time, we have evaluated, and expect that we will continue to evaluate, opportunities to obtain additional capital from the divestiture of radio stations or other assets, when we determine that it would further our strategic and financial objectives, as well as from the issuance of equity and/or debt securities, in each case, subject to market and other conditions in existence at that time. There can be no assurance that any such financing would be available on commercially acceptable terms, or at all. Future volatility in the capital and credit markets, caused by COVID-19 or otherwise, may increase costs associated with issuing debt instruments or affect our ability to access those markets. In addition, it is possible that our ability to access the capital and credit markets could be limited at a time when we would like, or need, to do so, which could have an adverse impact on our ability to refinance maturing debt on terms or at times acceptable to us, or at all, and/or react to changing economic and business conditions.

Refinanced Credit Agreement (Term Loan due 2026)

On September 26, 2019, the Company entered into a new credit agreement by and among Cumulus New Holdings Inc., a Delaware corporation and an indirectly wholly-owned subsidiary of the Company ("Holdings"), certain other subsidiaries of the Company, Bank of America, N.A., as Administrative Agent, and the other banks and financial institutions party thereto as Lenders (the "Refinanced Credit Agreement"). Pursuant to the Refinanced Credit Agreement, the lenders party thereto provided Holdings and its subsidiaries that are party thereto as co-borrowers with a $525.0 million senior secured Term Loan (the "Term Loan due 2026"), which was used to refinance the remaining balance of the then outstanding term loan (the "Term Loan due 2022").

Amounts outstanding under the Refinanced Credit Agreement bear interest at a per annum rate equal to (i) LIBOR plus an applicable margin of 3.75%, subject to a LIBOR floor of 1.00%, or (ii) the Alternative Base Rate (as defined below) plus an applicable margin of 2.75%, subject to an Alternative Base Rate floor of 2.00%. The Alternative Base Rate is defined, for any day, as the per annum rate equal to the highest of (i) the Federal Funds Rate, as published by the Federal Reserve Bank of New York, plus 1/2 of 1.0%, (ii) the rate identified by Bank of America, N.A. as its "Prime Rate" and (iii) one-month LIBOR plus 1.0%. As of December 31, 2020, the Term Loan due 2026 bore interest at a rate of 4.75% per annum.

Amounts outstanding under the Term Loan due 2026 amortize in equal quarterly installments of 0.25% of the original principal amount of the Term Loan due 2026 with the balance payable on the maturity date. The maturity date of the Term Loan due 2026 is March 26, 2026.

The Refinanced Credit Agreement contains representations, covenants and events of default that are customary for financing transactions of this nature. Events of default in the Refinanced Credit Agreement include, among others: (a) the failure to pay when due the obligations owing thereunder; (b) the failure to comply with (and not timely remedy, if applicable) certain covenants; (c) certain defaults and accelerations under other indebtedness; (d) the occurrence of bankruptcy or insolvency events; (e) certain judgments against Holdings or any of its subsidiaries; (f) the loss, revocation or suspension of, or any material impairment in the ability to use, any one or more of, any material FCC licenses; (g) any representation or warranty made, or report, certificate or financial statement delivered, to the lenders subsequently proven to have been incorrect in any material respect; and (h) the occurrence of a Change in Control (as defined in the Refinanced Credit Agreement). Upon the occurrence of an event of default, the Administrative Agent (as defined in the Refinanced Credit Agreement) may, with the consent of, or upon the request of, the required lenders, accelerate the Term Loan due 2026 and exercise any of its rights as a secured party under the Refinanced Credit Agreement and the ancillary loan documents provided, that in the case of certain bankruptcy or insolvency events with respect to a borrower, the Term Loan due 2026 will automatically accelerate.

The Refinanced Credit Agreement does not contain any financial maintenance covenants. The Refinanced Credit Agreement provides that Holdings will be permitted to enter into either a revolving credit facility or receivables facility, subject to certain conditions (see below).

The Company may elect, at their option, to prepay amounts outstanding under the Refinanced Credit Agreement without premium or penalty, except in a refinancing or repricing transaction prior to March 26, 2020, where the borrower would be required to pay a 1% premium. The borrowers may be required to make mandatory prepayments of the Term Loan due 2026 upon the occurrence of specified events as set forth in the Refinanced Credit Agreement, including upon the sale of certain assets and from Excess Cash Flow (as defined in the Refinanced Credit Agreement).

Amounts outstanding under the Refinanced Credit Agreement are guaranteed by Cumulus Media Intermediate Holdings, Inc., a Delaware corporation and a direct wholly-owned subsidiary of the Company ("Intermediate Holdings"), and the present and future wholly-owned subsidiaries of Holdings that are not borrowers thereunder, subject to certain exceptions as set forth in the Refinanced Credit Agreement (the "Guarantors") and secured by a security interest in substantially all of the assets of Holdings, the subsidiaries of Holdings party to the Refinanced Credit Agreement as borrowers, and the Guarantors.

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The issuance of the Term Loan due 2026 and repayment of the Term Loan due 2022 were evaluated in accordance with ASC 470-50-40 - Debt-Modifications and Extinguishments-Derecognition ("ASC 470-50-40"), to determine whether the refinancing transaction should be accounted for as a debt modification or extinguishment of the Term Loan due 2022. Each lender involved in the refinancing transaction was analyzed to determine if its participation was a debt modification or an extinguishment. Debt issuance costs for exiting lenders who chose not to participate in the Term Loan due 2026 were accounted for as extinguishments. Debt discounts and costs incurred with third parties for the issuance of the Term Loan due 2026 totaling $3.6 million for new lenders were capitalized and amortized over the term of the Term Loan due 2026. An additional $1.5 million of debt discount for the issuance of the Term Loan due 2026 was capitalized for continuing lenders deemed to be modified. These capitalized fees associated with new and continuing lenders are presented as cash flows from financing activities on the Consolidated Statements of Cash Flows. Costs incurred with third-parties for the issuance of the Term Loan due 2026 of $3.5 million related to modification for continuing lenders were expensed and included in Interest Expense in the Consolidated Statements of Operations.

Debt discounts and issuance costs of $5.1 million were capitalized and amortized over the term of the Term Loan due 2026. As of December 31, 2020, we were in compliance with all required covenants under the Refinanced Credit Agreement.

On September 30, 2020, pursuant to the Term Loan due 2026, the Company was required to pay down at closing of the Tower Sale $49.0 million. As a result of the pay down, the Company wrote-off approximately $0.4 million of debt issuance costs related to the Term Loan due 2026.

2020 Revolving Credit Agreement

On March 6, 2020, Holdings and certain of the Company’s other subsidiaries, as borrowers (the “Borrowers”), and Intermediate Holdings entered into a $100.0 million revolving credit facility (the “2020 Revolving Credit Facility") pursuant to a Credit Agreement (the "2020 Revolving Credit Agreement"), dated as of March 6, 2020, with Fifth Third Bank, as a lender and Administrative Agent and certain other lenders from time to time party thereto. The 2020 Revolving Credit Facility refinances and replaces the Company’s 2018 Revolving Credit Agreement (as defined below) entered into pursuant to that certain Credit Agreement dated as of August 17, 2018, by and among Holdings, the Borrowers, Intermediate Holdings and certain lenders and Deutsche Bank AG New York Branch, as a lender and Administrative Agent.

The 2020 Revolving Credit Facility has a maturity date of March 6, 2025. Availability under the 2020 Revolving Credit Facility is tied to a borrowing base equal to 85% of the accounts receivable of the Borrowers, subject to customary reserves and eligibility criteria and reduced by outstanding letters of credit. Under the 2020 Revolving Credit Facility, up to $10.0 million of availability may be drawn in the form of letters of credit and up to $10.0 million of availability may be drawn in the form of swing line loans.

Borrowings under the 2020 Revolving Credit Facility bear interest, at the option of Holdings, based on LIBOR plus a percentage spread of 1.00% or the Alternative Base Rate. The Alternative Base Rate is defined, for any day, as the per annum rate equal to the rate identified as the “Prime Rate” by Fifth Third Bank. In addition, the unused portion of the 2020 Revolving Credit Facility will be subject to a commitment fee of 0.25%. The 2020 Revolving Credit Facility contains customary LIBOR successor provisions.

The 2020 Revolving Credit Agreement contains representations, covenants and events of default that are customary for financing transactions of this nature. Events of default in the 2020 Revolving Credit Agreement include, among others: (a) the failure to pay when due the obligations owing thereunder; (b) the failure to perform (and not timely remedy, if applicable) certain covenants; (c) certain defaults and accelerations under other indebtedness; (d) the occurrence of bankruptcy or insolvency events; (e) certain judgments against Intermediate Holdings or any of its subsidiaries; (f) the loss, revocation or suspension of, or any material impairment in the ability to use, any one or more of, any material FCC licenses; (g) any representation or warranty made, or report, certificate or financial statement delivered, to the lenders subsequently proven to have been incorrect in any material respect; and (h) the occurrence of a Change in Control (as defined in the 2020 Revolving Credit Agreement). Upon the occurrence of an event of default, the lenders may terminate the loan commitments, accelerate all loans and exercise any of their rights under the 2020 Revolving Credit Agreement and the ancillary loan documents as a secured party.

The 2020 Revolving Credit Agreement does not contain any financial maintenance covenants with which the Company must comply. However, if average excess availability under the 2020 Revolving Credit Facility is less than the greater of (a) 12.5% of the total commitments thereunder or (b) $10.0 million, the Company must comply with a fixed charge coverage ratio of not less than 1.0:1.0.

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Amounts outstanding under the 2020 Revolving Credit Agreement are guaranteed by Intermediate Holdings and the present and future wholly-owned subsidiaries of Intermediate Holdings that are not borrowers thereunder, subject to certain exceptions as set forth in the 2020 Revolving Credit Agreement (the “2020 Revolver Guarantors”) and secured by a security interest in substantially all of the assets of Holdings, the subsidiaries of Holdings party to the 2020 Revolving Credit Agreement as borrowers, and the 2020 Revolver Guarantors.

The issuance of the 2020 Revolving Credit Agreement was determined to be a modification of the 2018 Revolving Credit Agreement (as defined below) in accordance with ASC 470-50-40. The Company expensed approximately $0.6 million of unamortized debt issuance costs related to the exiting lender. Costs incurred with third parties for issuance of the 2020 Revolving Credit Agreement totaled approximately $0.4 million and were capitalized and will be amortized over the term of the 2020 Revolving Credit Agreement.

As of December 31, 2020, $65.1 million was outstanding under the 2020 Revolving Credit Facility, including letters of credit. As of December 31, 2020, the Company was in compliance with all required covenants under the 2020 Revolving Credit Agreement.

2018 Revolving Credit Agreement

On August 17, 2018, Holdings entered into a $50.0 million revolving credit facility (the "2018 Revolving Credit Facility") pursuant to a credit agreement (the "2018 Revolving Credit Agreement"), dated as of August 17, 2018, with certain subsidiaries of Holdings as borrowers, Intermediate Holdings as a guarantor, certain lenders, and Deutsche Bank AG New York Branch as a lender and Administrative Agent. The 2018 Revolving Credit Facility was scheduled to mature on August 17, 2023.

As of December 31, 2019, $2.9 million was outstanding in the form of letters of credit under the 2018 Revolving Credit Facility. The 2018 Revolving Credit Facility was terminated and replaced by the 2020 Revolving Credit Facility on March 6, 2020 (see above).

6.75% Senior Notes

On June 26, 2019, Holdings (the "Issuer"), and certain of the Company's other subsidiaries, entered into an indenture, dated as of June 26, 2019 (the "Indenture") with U.S. Bank National Association, as trustee, governing the terms of the Issuer's $500,000,000 aggregate principal amount of 6.75% Senior Secured First-Lien Notes due 2026 (the "6.75% Senior Notes"). The 6.75% Senior Notes were issued on June 26, 2019. The net proceeds from the issuance of the 6.75% Senior Notes were applied to partially repay existing indebtedness under the Term Loan due 2022 (see above). In conjunction with the issuance of the 6.75% Senior Notes, debt issuance costs of $7.3 million were capitalized and are being amortized over the term of the 6.75% Senior Notes.

Interest on the 6.75% Senior Notes is payable on January 1 and July 1 of each year, commencing on January 1, 2020. The 6.75% Senior Notes mature on July 1, 2026.

The Issuer may redeem some or all of the 6.75% Senior Notes at any time, or from time to time, on or after July 1, 2022, at the following prices:

Year	Price
2022	103.7500	%
2023	101.6875	%
2024 and thereafter	100.0000	%

Prior to July 1, 2022, the Issuer may redeem all or part of the 6.75% Senior Notes upon not less than 30 nor more than 60 days prior notice, at 100% of the principal amount of the 6.75% Senior Notes redeemed plus a "make whole" premium.

The 6.75% Senior Notes are fully and unconditionally guaranteed by Intermediate Holdings and the present and future wholly-owned subsidiaries of Holdings (the "Senior Notes Guarantors"), subject to the terms of the Indenture. Other than certain assets secured on a first priority basis under the 2020 Revolving Credit Facility (as to which the 6.75% Senior Notes are secured on a second-priority basis), the 6.75% Senior Notes and related guarantees are secured on a first-priority basis pari passu with the Term Loan due 2026 (subject to certain exceptions) by liens on substantially all of the assets of the Issuer and the Senior Notes Guarantors.

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The Indenture contains representations, covenants and events of default customary for financing transactions of this nature. As of December 31, 2020, the Issuer was in compliance with all required covenants under the Indenture. A default under the 6.75% Senior Notes could cause a default under the Refinanced Credit Agreement.

The 6.75% Senior Notes have not been and will not be registered under the federal securities laws or the securities laws of any state or any other jurisdiction. The Company is not required to register the 6.75% Senior Notes for resale under the Securities Act, or the securities laws of any other jurisdiction and is not required to exchange the 6.75% Senior Notes for notes registered under the Securities Act or the securities laws of any other jurisdiction and has no present intention to do so. As a result, Rule 3-10 of Regulation S-X promulgated by the SEC is not applicable and no separate financial statements are required for the guarantor subsidiaries.

On November 3, 2020, the Company completed a tender offer ("Tender Offer") pursuant to which it accepted and cancelled $47.2 million in aggregate principal amount of the 6.75% Notes as a result of the Tower Sale. See Note 2, "Acquisitions and Dispositions" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for additional discussion related to the Tender Offer. As a result of the Tender Offer, the Company wrote-off approximately $0.6 million of debt issuance costs related to the 6.75% Notes.

Significant Cash Payments

The following table summarizes our significant non-operating cash payments made for the years ended December 31, 2020 and 2019, respectively (dollars in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Repayments of borrowings under the Term Loan due 2022	$	—	$	1,242,918
Repayments of borrowings under Term Loan due 2026	$	54,277	$	1,313
Repayments of borrowings under 6.75% Senior Notes	$	47,164	$	—
Interest payments	$	62,513	$	76,846
Capital expenditures	$	14,868	$	29,469

Net Cash Provided by Operating Activities

(Dollars in thousands)	Year Ended December 31, 2020		Year Ended December 31, 2019
Net cash provided by operating activities	$	33,210	104,270

Net cash provided by operating activities for the year ended December 31, 2020 compared to the year ended December 31, 2019 decreased primarily as a result of lower income partially offset by improved collections.

Net Cash Provided by Investing Activities

(Dollars in thousands)	Year Ended December 31, 2020		Year Ended December 31, 2019
Net cash provided by investing activities	$	64,359	117,589

For the year ended December 31, 2020, net cash provided by investing activities primarily includes the proceeds received from the sales of the DC Land and WABC partially offset by capital expenditures. For additional detail about the sale of the DC Land and the WABC Sale, see Note 2, "Acquisitions and Dispositions" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K.

For the year ended December 31, 2019, net cash provided by investing activities primarily consists of proceeds received from the EMF and KLOS-FM sales in 2019 partially offset by capital expenditures. For additional detail about the EMF and KLOS-FM sales in 2019, see Note 2, "Acquisitions and Dispositions" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K.

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Net Cash Provided by (Used in) Financing Activities

(Dollars in thousands)	Year Ended December 31, 2020		Year Ended December 31, 2019
Net cash provided by (used in) financing activities	$	157,185	(234,890)

For the year ended December 31, 2020, net cash used in financing activities primarily reflects $202.3 million of cash received from the sale of substantially all of the Company's broadcast communications tower sites and certain other related assets (the "Tower Sale"), after transaction costs and closing adjustments, and $60.0 million of proceeds received from borrowings under the 2020 Revolving Credit Agreement partially offset by the $49 million pay down of the Term Loan due 2026 and the $47.2 million pay down of the 6.75% Senior Notes as a result of the Tender Offer, each as required at closing of the Tower Sale. See Note 2, "Acquisitions and Dispositions," in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K.

For the year ended December 31, 2019, net cash used in financing activities reflects our repayment of the outstanding balance on the Term Loan due 2022 from proceeds received from new debt issuances (Term Loan due 2026 of $525.0 million and 6.75% Senior Notes of $500.0 million) and the EMF and KLOS-FM sales as well as cash generated from operations. See Note 7, "Long-Term Debt" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for further discussion of the new debt issuances. We also paid $12.9 million in deferred financing costs.

Critical Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including significant estimates related to bad debts, intangible assets, income taxes, stock-based compensation, contingencies, litigation, valuation assumptions for impairment analysis, certain expense accruals and, if applicable, purchase price allocations. The Company bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, and which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual amounts and results may differ materially from these estimates.

Revenue Recognition

Revenue is derived primarily from the sale of commercial airtime to local and national advertisers. Revenues are recognized when control of the promised goods or services are transferred to the customer, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those good or services.

Broadcasting advertising revenue is recognized as commercials are broadcast. In those instances in which the Company functions as the principal in the transaction, the revenue and associated operating costs are presented on a gross basis. In those instances where the Company functions as an agent or sales representative, the effective commission is presented as revenue on a net basis with no corresponding operating expenses.

Accounts Receivable, Allowance for Doubtful Accounts and Concentration of Credit Risk

Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in the Company's existing accounts receivable. The Company determined the allowance based on several factors, including the length of time receivables are past due, trends and current economic factors. All balances are reviewed and evaluated quarterly on a consolidated basis. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet credit exposure related to its customers. The Company performs credit evaluations of its customers as needed and believes that adequate allowances for any uncollectible accounts receivable are maintained.

Intangible Assets

As of December 31, 2020, we had approximately $970.0 million of indefinite-lived and definite-lived intangible assets, which represented approximately 52.2% of our total assets. The Company's indefinite-lived intangible assets are comprised primarily of FCC licenses. We perform annual impairment tests of our indefinite-lived intangible assets as of December 31 of

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each year and on an interim basis if events or circumstances indicated that indefinite-lived intangible assets may be impaired. Impairment exists when the asset carrying amounts exceed their respective fair values and the excess is then recorded as an impairment charge to operations. See Note 5, "Intangible Assets" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K for further discussion of the annual and interim impairment tests performed of our indefinite-lived intangible assets.

The Company's definite-lived intangible assets consist primarily of affiliate and producer relationships, which are amortized over the period of time the intangible assets are expected to contribute directly or indirectly to the Company's future cash flows.

Stock-based Compensation Expense

Stock-based compensation expense recognized for the years ended December 31, 2020 and 2019, was $3.3 million and $5.3 million, respectively. For awards with service conditions, stock-based compensation expense is recognized on a straight-line basis over the requisite service period for the entire award. In addition, the Company made an accounting policy election to recognize forfeitures of share-based awards as they occur in the period of forfeiture rather than estimating the number of awards expected to be forfeited at the grant date and subsequently adjusting the estimate when awards are actually forfeited. For stock options with service conditions only, we utilize the Black-Scholes option pricing model to estimate the fair value of options issued. The fair value of stock options is determined by the Company's stock price, historical stock price volatility, the expected term of the awards, risk-free interest rates and expected dividends. The fair value of time-based and performance-based restricted stock awards is the quoted market value of our stock on the grant date. For performance-based restricted stock awards, the Company evaluates the probability of vesting of the awards in each reporting period. In the event the Company determines it is no longer probable that the minimum performance criteria specified in the award will be achieved, all previously recognized compensation expense will be reversed in the period such a determination is made.

Income Taxes

The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates the Company expects will be applicable when those tax assets and liabilities are realized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

A valuation allowance is provided for deferred tax assets when it is more likely than not that the asset will not be realized. We continually review the adequacy of our valuation allowance, if any, on our deferred tax assets and recognize the benefits of deferred tax assets only as the reassessment indicates that it is more likely than not that the deferred tax assets will be recognized in accordance with ASC Topic 740, Income Taxes ("ASC 740"). In assessing the need for a valuation allowance, the Company considers both positive and negative evidence related to the likelihood of realization of the deferred tax assets. If the Company were to determine that it would be able to realize deferred tax assets in the future in excess of the Company's net recorded amount, an adjustment to the net deferred tax asset would increase income in the period that such determination was made. Likewise, should the Company determine that it would not be able to realize all or part of its net deferred tax assets in the future, an adjustment to the net deferred tax asset would decrease income in the period such determination was made.

The Company recognizes a tax position as a benefit only if it is more-likely-than-not that the position would be sustained in an examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that has a greater than 50% likelihood of being realized on examination. For tax positions not meeting the more-likely-than-not test, no tax benefit is recorded.

Legal Proceedings

The Company currently is, and expects that from time to time in the future it will be, party to, or a defendant in, various other claims or lawsuits (the "Other Claims") that are generally incidental to its business. The Company expects that it will vigorously contest any Other Claims and, although we are unable to reasonably estimate what effect the ultimate resolution of any known Other Claims might have, the Company does not believe that the ultimate resolution of any known Other Claims would have a material adverse effect on the Company's financial position, results of operations or cash flows. For more information, see Note 14, "Commitments and Contingencies" in the accompanying audited consolidated financial statements included elsewhere in this Form 10-K.

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Trade and Barter Transactions

The Company provides commercial advertising inventory in exchange for goods and services used principally for promotional, sales, programming and other business activities. Programming barter revenue is derived from an exchange of programming content, to be broadcast on the Company's airwaves, for commercial advertising inventory, usually in the form of commercial placements inside the show exchanged. Trade and barter value is based upon management's estimate of the fair value of the products, supplies and services received. Trade and barter revenue is recorded when commercial spots are aired, in the same pattern as the Company's normal cash spot revenue is recognized. Trade and barter expense is recorded when goods or services are consumed. For the years ended December 31, 2020 and 2019, amounts reflected under trade and barter transactions were: (1) trade and barter revenues of $34.2 million and $45.3 million, respectively; and (2) trade and barter expenses of $33.6 million and $44.4 million, respectively.

Off-Balance Sheet Arrangements

We did not have any off-balance sheet arrangements as of December 31, 2020.

New Accounting Standards

Refer to Note 1, "Nature of Business, Basis of Presentation and Summary of Significant Accounting Policies" in the notes to the accompanying audited consolidated financial statements included elsewhere in the Form 10-K.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Item 8. Financial Statements and Supplementary Data

The information in response to this item is included in our consolidated financial statements, together with the report thereon of PricewaterhouseCoopers LLP, beginning on page F-2 of this Form 10-K, which follows the signature page hereto.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

We maintain a set of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) designed to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms. Such disclosure controls and procedures are designed to ensure that information required to be disclosed in reports we file or submit under the Exchange Act is accumulated and communicated to our management, including, our President and CEO and CFO, the principal executive and principal financial officers, respectively, as appropriate, to allow timely decisions regarding required disclosure. At the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of our management, including our CEO and CFO, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, the CEO and CFO have concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of December 31, 2020.

Management necessarily applies its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management's control objectives. The Company's management, including the CEO and the CFO, does not expect that our disclosure controls and procedures can prevent all possible errors or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that misstatements as a result of error or fraud will not occur or that all control issues and instances of fraud, if any, within the company have been detected. Judgments in decision-making can be faulty and breakdowns can occur because of simple errors or mistakes. Additionally, controls can be circumvented by the individual acts of one or more persons. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and while our

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disclosure controls and procedures are designed to be effective under circumstances where they should reasonably be expected to operate effectively, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Because of the inherent limitations in any control system, misstatements because of possible errors or fraud may occur and not be detected.

(b) Management's Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act). The Company's management assessed the effectiveness of its internal control over financial reporting as of December 31, 2020. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013). Based on this assessment, management has concluded that, as of December 31, 2020, the Company's internal control over financial reporting was effective.

The effectiveness of our internal control over financial reporting as of December 31, 2020 has been audited by PricewaterhouseCoopers LLP, an Independent Registered Public Accounting Firm, as stated in their report which appears herein.

/s/ Mary G. Berner	/s/ Francisco J. Lopez-Balboa
President, Chief Executive Officer and Director	Executive Vice President, Chief Financial Officer

(c) Changes in Internal Control over Financial Reporting

There were no changes to our internal control over financial reporting during the fourth quarter of 2020 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information

None.

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PART III

Item 10. Directors and Executive Officers and Corporate Governance

In accordance with General Instruction G.(3) to Form 10-K, the information required by this item with respect to our directors, is incorporated by reference to the information to be set forth in our definitive proxy statement for the 2021 Annual Meeting of Stockholders expected to be filed no later than 120 days after the end of the fiscal year covered by this Form 10-K ("2021 Proxy Statement").

Item 11. Executive Compensation

In accordance with General Instruction G.(3) to Form 10-K, the information required by this item is incorporated by reference to the information to be set forth under the caption "Executive Compensation" in our 2021 Proxy Statement.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

In accordance with General Instruction G.(3) to Form 10-K, the information required by this item with respect to the security ownership of our management and certain beneficial owners is incorporated by reference to the information set forth under the caption "Security Ownership of Certain Beneficial Owners and Management" in our 2021 Proxy Statement.

Securities Authorized for Issuance Under Equity Incentive Plans

The following table sets forth, as of December 31, 2020, the number of securities outstanding under our equity compensation plans, the weighted average exercise price of such securities, if applicable, and the number of securities available for grant under these plans:

Plan Category	To be Issued Upon Exercise of Outstanding Options Warrants and Rights (a)	Weighted-Average Exercise Price of Outstanding Options Warrants and Rights		Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans (excluding securities reflected in column (a))
Equity Compensation Plans Approved by Stockholders	771,114	$	20.00	2,504,315
Equity Compensation Plans Not Approved by Stockholders	—	—		—
Total	771,114	$	20.00	2,504,315

Item 13. Certain Relationships and Related Transactions, and Director Independence

In accordance with General Instruction G.(3) to Form 10-K, the information required by this item with respect to our directors, is incorporated by reference to the information to be set forth under the captions "Certain Relationships and Related Transactions" and "Information about the Board of Directors" in our 2021 Proxy Statement.

Item 14. Principal Accountant Fees and Services

In accordance with General Instruction G.(3) to Form 10-K, the information required by this item, is incorporated by reference to the information to be set forth under the caption "Proposal No. 3: Ratification of the Appointment of PricewaterhouseCoopers LLP as Independent Registered Public Accounting Firm" in our 2021 Proxy Statement.

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PART IV

Item 15. Exhibits, Financial Statement Schedules

(a) (1)-(2) Financial Statements. The financial statements and financial statement schedule listed in the Index to Consolidated Financial Statements appearing on page F-1 of this Form 10-K are filed as a part of this report. All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission have been omitted either because they are not required under the related instructions or because they are not applicable.

(3) Exhibits

EXHIBIT INDEX

2.1	First Amended Joint Plan of Reorganization of Cumulus Media Inc. and its Debtor Affiliates Pursuant to Chapter 11 of the Bankruptcy Code (incorporated by reference to Exhibit 2.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
3.1	Amended and Restated Certificate of Incorporation of Cumulus Media Inc. (incorporated by reference to Exhibit 3.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
3.2	Amended and Restated Bylaws of Cumulus Media Inc. (incorporated by reference to Exhibit 3.2 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
4.1	Form of Global Warrant Certificate (incorporated by reference to Exhibit 4.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
4.2	Form of Class A common stock certificate (incorporated by reference to Exhibit 4.3 to Cumulus Media Inc.'s Registration Statement on Form S-8 filed with the SEC on June 4, 2018)
4.3	Indenture, dated as of June 26, 2019, by and among Cumulus Media New Holdings Inc., the guarantors party thereto, and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 26, 2019)
4.4	Form of 6.75% Senior Secured First Lien Note due 2026 (included in Exhibit 4.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 26, 2019)
4.5	Description of Registrant's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (incorporated by reference to Exhibit 4.5 to Cumulus Media Inc.'s Annual Report on Form 10-K filed with the SEC on February 21, 2020)
4.6	Rights Agreement, dated as of May 21, 2020, by and between Cumulus Media Inc. and Computershare Trust Company, N.A. (incorporated by reference to Exhibit 4.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on May 21, 2020)
10.1	Warrant Agreement, dated as of June 4, 2018, among the Company, Computershare Inc. and Computershare Trust Company, N.A. (incorporated by reference to Exhibit 10.2 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
10.2 *	Form of Indemnification Agreement (incorporated by reference to Exhibit 10.3 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
10.3 *	Cumulus Media Inc. Long-Term Incentive Plan (incorporated by reference to Exhibit 10.4 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
10.4 *	Form of Restricted Stock Unit Agreement (Non-Senior Executive) (incorporated by reference to Exhibit 10.5 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)

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10.5 *	Form of Restricted Stock Unit Agreement (Senior Executive) (incorporated by reference to Exhibit 10.6 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
10.6 *	Form of Restricted Stock Unit Agreement (Director) (incorporated by reference to Exhibit 10.7 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
10.7 *	Form of Stock Option Agreement (Non-Senior Executive) (incorporated by reference to Exhibit 10.8 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
10.8 *	Form of Stock Option Agreement (Senior Executive) (incorporated by reference to Exhibit 10.9 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
10.9 *	Form of Stock Option Agreement (Director) (incorporated by reference to Exhibit 10.10 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on June 4, 2018)
10.10*	First Amendment to Employment Agreement, dated March 30, 2016, by and between Cumulus Media Inc. and Richard S. Denning (incorporated by reference to Exhibit 10.2 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on March 31, 2016)
10.11*	Second Amendment to Employment Agreement, dated August 26, 2016, by and between Cumulus Media Inc. and Richard S. Denning (incorporated by reference to Exhibit 10.1 to Cumulus Media Inc.'s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2016)
10.12*	Third Amendment to Employment Agreement, dated October 25, 2017, by and between Cumulus Media Inc. and Richard S. Denning (incorporated by reference to Exhibit 10.18 to Cumulus Media Inc.'s Annual Report on Form 10-K filed with the SEC on March 29, 2018)
10.13	Credit Agreement, dated as of September  26, 2019, among Cumulus Media New Holdings Inc., certain of Cumulus Media New Holding, Inc.'s other subsidiaries, certain lenders, Bank of America, N.A as administrative agent, and Bank of America, N.A., Credit Suisse Loan Funding LLC, Deutsche Bank Securities Inc., Morgan Stanley Senior Funding, Inc., JPMorgan Chase Bank, N.A. and Fifth Third Bank as joint lead arrangers and bookrunners (incorporated by reference to Exhibit 10.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on October 1, 2019)
10.14	ABL Credit Agreement, dated as of March 6, 2020, among Cumulus Media Intermediate, Inc., Cumulus Media New Holdings Inc., certain of Cumulus Media New Holding, Inc.’s other subsidiaries, Fifth Third Bank National Association as a lender and Administrative Agent and certain other lenders from time to time party thereto (incorporated by reference to Exhibit 10.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on March 12, 2020)
10.15 *	Form of Executive Vice President and Chief Financial Officer Employment Agreement (incorporated by reference to Exhibit 10.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on March 19, 2020)
10.16 *	Form of President and Chief Executive Officer Employment Agreement (incorporated by reference to Exhibit 10.2 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on March 19, 2020)
10.17 *	Employment Agreement, dated as of August 1, 2020, by and between Cumulus Media Inc. and Suzanne Grimes (incorporated by reference to Exhibit 10.1 to Cumulus Media Inc.'s Current Report on Form 8-K filed with the SEC on August 6, 2020)
10.18 *	2020 Equity and Incentive Compensation Plan (incorporated by reference to Exhibit 10.1 to Cumulus Media Inc.'s Quarterly Report on Form 10-Q filed with the SEC on August 10, 2020)
10.19	Master Agreement, dated August 7, 2020, between Vertical Bridge REIT, LLC, VB NIMBUS, LLC, and Cumulus Media New Holdings Inc. (incorporated by reference to Exhibit 10.2 to Cumulus Media Inc.'s Quarterly Report on Form 10-Q filed with the SEC on November 5, 2020)

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10.20	Description of 2021 Quarterly Incentive Plan
21.1 **	Subsidiaries.
23.1 **	Consent of PricewaterhouseCoopers LLP.
31.1 **	Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 **	Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 **	Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document.
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	Inline XBRL Taxonomy Extension Labels Linkbase Document.
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Data File - (formatted as Inline XBRL and contained in Exhibit 101)
*	Management contract or compensatory plan or arrangement.
**	Filed or furnished herewith.

(b) Exhibits. See Exhibits above.

(c) Financial Statement Schedules. Schedule II – Valuation and Qualifying Accounts.

Item 16. Form 10-K Summary

None.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized, on the 23rd day of February 2021.

CUMULUS MEDIA INC.
By	/s/    Francisco J. Lopez-Balboa
	Francisco J. Lopez-Balboa Executive Vice President, Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

Signature	Title	Date
/s/    Mary G. Berner	President, Chief Executive Officer and Director	February 23, 2021
Mary G. Berner
/s/    Francisco J. Lopez-Balboa	Executive Vice President, Chief Financial Officer	February 23, 2021
Francisco J. Lopez-Balboa
/s/    Andrew W. Hobson	Director	February 23, 2021
Andy W. Hobson
/s/    David M. Baum	Director	February 23, 2021
David M. Baum
/s/    Matthew C. Blank	Director	February 23, 2021
Matthew C. Blank
/s/    Thomas H. Castro	Director	February 23, 2021
Thomas H. Castro
/s/    Joan Hogan Gillman	Director	February 23, 2021
Joan Hogan Gillman
/s/    Brian G. Kushner	Director	February 23, 2021
Brian G. Kushner

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

The following Consolidated Financial Statements of Cumulus Media Inc. are included in Item 8:

		Page
(1)	Financial Statements
	Reports of Independent Registered Public Accounting Firm	F-2
	Consolidated Balance Sheets as of December 31, 2020 and 2019	F-4
	Consolidated Statements of Operations for the years ended December 31, 2020 and 2019	F-5
	Consolidated Statements of Stockholders' Equity for the years ended December 31, 2020 and 2019	F-6
	Consolidated Statements of Cash Flows for the years ended December 31, 2020 and 2019	F-7
	Notes to Consolidated Financial Statements	F-8
(2)	Financial Statement Schedule
	Schedule II: Valuation and Qualifying Accounts	S-1

F-1

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Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Cumulus Media Inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Cumulus Media Inc. and its subsidiaries (the “Company”) as of December 31, 2020 and 2019, and the related consolidated statements of operations, of stockholders’ equity and of cash flows for the years then ended, including the related notes and schedule of valuation and qualifying accounts for the years ended December 31, 2020 and 2019 listed in the accompanying index (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

F-2

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Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

FCC Broadcast Licenses Impairment Assessments

As described in Notes 1 and 5 to the consolidated financial statements, the Company’s indefinite-lived intangible assets include Federal Communications Commission (“FCC”) broadcast licenses of $825.6 million as of December 31, 2020. Management performs annual impairment testing as of December 31 of each year and on an interim basis if events or circumstances indicate that the indefinite-lived intangible assets may be impaired. Management determined that the geographic markets are the appropriate unit of accounting for FCC license impairment testing and therefore management has combined the FCC licenses within each geographic market cluster into a single unit of accounting for impairment testing purposes. In order to determine the fair value of the FCC licenses, management utilized the income approach, specifically the Greenfield Method. This method values a license by calculating the value of a hypothetical start-up company that initially has no assets except the asset to be valued (the license). Management’s projections used in the Greenfield Method for its FCC broadcast licenses included significant judgments and assumptions relating to the mature operating profit margin for average stations in the markets where the Company operates, long-term revenue growth rate, and the discount rate.

The principal considerations for our determination that performing procedures relating to FCC broadcast licenses impairment assessments is a critical audit matter are the significant judgment by management when developing the fair value measurement of the FCC broadcast licenses. This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to the mature operating profit margin for average stations in the markets where the Company operates, the long-term revenue growth rate, and the discount rate. In addition, the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s indefinite-lived intangible asset impairment assessment, including controls over the valuation of the Company’s FCC broadcast licenses. These procedures also included, among others, (i) testing management’s process for developing the fair value estimates; (ii) evaluating the appropriateness of the projections used in the Greenfield Method; (iii) testing the completeness, accuracy, and relevance of underlying data used in the method; and (iv) evaluating the significant assumptions used by management related to the mature operating profit margin for average stations in the markets where the Company operates, the long-term revenue growth rate, and the discount rate. Evaluating management’s assumptions relating to the mature operating profit margin for average stations in the markets where the Company operates and long-term revenue growth rate involved evaluating whether the assumptions used by management were reasonable considering (i) the consistency with external market and industry data, and (ii) whether these assumptions were consistent with evidence obtained in other areas of the audit. Professionals with specialized skill and knowledge were used to assist in the evaluation of the discount rate assumption.

/s/ PricewaterhouseCoopers LLP

Atlanta, Georgia

February 23, 2021

We have served as the Company’s auditor since 2008.

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CUMULUS MEDIA INC.

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except for share data)

	December 31, 2020		December 31, 2019
Assets
Current assets:
Cash and cash equivalents	$	271,761	$	15,142
Restricted cash	—		1,865
Accounts receivable, less allowance for doubtful accounts of $6,745 and $5,197 at December 31, 2020 and 2019, respectively	201,275		242,599
Trade receivable	1,986		2,790
Assets held for sale	—		87,000
Prepaid expenses and other current assets	27,942		31,285
Total current assets	502,964		380,681
Property and equipment, net	208,692		232,934
Operating lease right-of-use assets	157,568		143,436
Broadcast licenses	825,590		830,490
Other intangible assets, net	144,387		164,383
Deferred income tax assets	7,779		—
Other assets	12,758		9,408
Total assets	$	1,859,738	$	1,761,332
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses	$	94,128	$	97,527
Current portion of operating lease liabilities	28,121		34,462
Trade payable	1,537		2,323
Current portion of term loan due 2026	5,250		5,250
Total current liabilities	129,036		139,562
2020 revolving credit facility	60,000		—
Term loan due 2026, net of debt issuance costs of $3,850 and $5,007 at December 31, 2020 and 2019, respectively	460,311		513,431
6.75% senior notes, net of debt issuance costs of $5,486 and $6,938 at December 31, 2020 and 2019, respectively	447,350		493,062
Operating lease liabilities	129,273		111,184
Financing liabilities, net	222,802		17,221
Other liabilities	13,375		10,618
Deferred income tax liabilities	—		21,038
Total liabilities	1,462,147		1,306,116
Commitments and contingencies (Note 14)
Stockholders' equity:
Class A common stock, par value $0.0000001 per share; 100,000,000 shares authorized; 18,135,956 and 15,750,097 shares issued; 17,961,734 and 15,681,439 shares outstanding at December 31, 2020 and 2019, respectively	—		—
Convertible Class B common stock, par value $0.0000001 per share; 100,000,000 shares authorized; 2,416,253 and 1,926,848 shares issued and outstanding at December 31, 2020 and 2019, respectively	—		—
Treasury stock, at cost, 174,222 and 68,658 shares at December 31, 2020 and 2019, respectively	(2,414)		(1,171)
Additional paid-in-capital	337,042		333,705
Retained earnings	62,963		122,682
Total stockholders' equity	397,591		455,216
Total liabilities and stockholders' equity	$	1,859,738	$	1,761,332

See accompanying notes to the consolidated financial statements.

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CUMULUS MEDIA INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, except for share and per share data)

	December 31, 2020		December 31, 2019
Net revenue	$	816,218	$	1,113,445
Operating expenses:
Content costs	337,078		405,653
Selling, general & administrative expenses	367,695		461,218
Depreciation and amortization	52,290		52,554
Local marketing agreement fees	3,149		3,500
Corporate expenses	49,199		57,988
Loss (gain) on sale or disposal of assets or stations	8,761		(55,403)
Impairment of assets held for sale	—		6,165
Impairment of capitalized software development costs	4,139		—
Impairment of intangible assets	4,509		15,563
Total operating expenses	826,820		947,238
Operating (loss) income	(10,602)		166,207
Non-operating expense:
Interest expense	(68,099)		(82,916)
Interest income	6		25
Gain on early extinguishment of debt	—		381
Other expense, net	(273)		(177)
Total non-operating expense, net	(68,366)		(82,687)
(Loss) income before income taxes	(78,968)		83,520
Income tax benefit (expense)	19,249		(22,263)
Net (loss) income	$	(59,719)	$	61,257
Basic and diluted (loss) earnings per common share (see Note 12, "(Loss) Earnings Per Share"):
Basic:     (Loss) Earnings per share	$	(2.94)	$	3.04
Diluted:  (Loss) Earnings per share	$	(2.94)	$	3.02
Weighted average basic common shares outstanding	20,317,064		20,130,835
Weighted average diluted common shares outstanding	20,317,064		20,284,137

See accompanying notes to the consolidated financial statements.

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CUMULUS MEDIA INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

For the years ended December 31, 2020 and December 31, 2019

(Dollars in thousands)

	Class A Common Stock			Class B Common Stock			Treasury Stock
	Number of Shares	Par Value		Number of Shares	Par Value		Number of Shares	Value		Additional Paid-In Capital		Retained Earnings		Total
Balance at December 31, 2018	12,995,080	$	—	3,560,604	$	—	—	$	—	$	328,404	$	61,425	$	389,829
Net income	—	—		—	—		—	—		—		61,257		61,257
Shares returned in lieu of tax payments	—	—		—	—		68,658	(1,171)		—		—		(1,171)
Conversion of Class B common stock	1,636,791	—		(1,636,791)	—		—	—		—		—		—
Exercise of warrants	900,729	—		—	—		—	—		—		—		—
Issuance of common stock	148,839	—		3,035	—		—	—		—		—		—
Stock-based compensation expense	—	—		—	—		—	—		5,301		—		5,301
Balance at December 31, 2019	15,681,439	$	—	1,926,848	$	—	68,658	$	(1,171)	$	333,705	$	122,682	$	455,216
Net loss	—	—		—	—		—	—		—		(59,719)		(59,719)
Shares returned in lieu of tax payments	—	—		—	—		105,564	(1,243)		—		—		(1,243)
Conversion of Class B common stock	196,910	—		(196,910)	—		—	—		—		—		—
Exercise of warrants	1,844,367	—		686,315	—		—	—		—		—		—
Issuance of common stock	239,018	—		—	—		—	—		—		—		—
Stock-based compensation expense	—	—		—	—		—	—		3,337		—		3,337
Balance at December 31, 2020	17,961,734	$	—	2,416,253	$	—	174,222	$	(2,414)	$	337,042	$	62,963	$	397,591

See accompanying notes to the consolidated financial statements.

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CUMULUS MEDIA INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)

	Year Ended December 31, 2020		Year Ended December 31, 2019
Cash flows from operating activities:
Net (loss) income	$	(59,719)	$	61,257
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	52,290		52,554
Amortization of right of use assets	10,888		24,053
Amortization and write-off of debt issuance costs	3,507		894
Provision for doubtful accounts	7,776		4,077
Loss (gain) on sale of assets or stations	8,761		(55,403)
Impairment of assets held for sale	—		6,165
Impairment of intangible assets	4,509		15,563
Impairment of capitalized software development costs	4,139		—
Deferred income taxes	(28,816)		8,654
Stock-based compensation expense	3,337		5,301
Gain on early extinguishment of debt	—		(381)
Non-cash interest expense on financing liabilities	1,624		776
Non-cash imputed rental income	(1,117)		—
Other	—		9
Changes in assets and liabilities (excluding acquisitions and dispositions):
Accounts receivable	33,898		3,433
Trade receivable	525		53
Prepaid expenses and other current assets	3,102		(176)
Operating leases	18,459		4,592
Assets held for sale	(4)		29
Other assets	(4,428)		5,345
Accounts payable and accrued expenses	(28,145)		(32,843)
Trade payable	(786)		(177)
Other liabilities	3,410		495
Net cash provided by operating activities	33,210		104,270
Cash flows from investing activities:
Proceeds from sale of assets or stations	78,700		147,058
Proceeds from insurance reimbursement	527		—
Capital expenditures	(14,868)		(29,469)
Net cash provided by investing activities	64,359		117,589
Cash flows from financing activities:
Repayment of borrowings under term loan due 2022	—		(1,242,918)
Repayment of borrowings under term loan due 2026	(54,277)		(1,313)
Borrowings under term loan due 2026	—		525,000
Repayment of borrowings under 6.75% senior notes	(47,164)		—
Borrowings under the 2020 revolving credit facility	60,000		—
Proceeds from issuance of 6.75% senior notes	—		500,000
Financing costs	(493)		(12,883)
Shares returned in lieu of tax payments	(1,243)		(1,171)
Transaction costs for financing liability	(3,152)		—
Proceeds from financing liability	205,442		—
Repayments of financing liabilities	(1,590)		(1,191)
Repayments of finance lease obligations	(338)		(414)
Net cash provided by (used in) financing activities	157,185		(234,890)
Increase (decrease) in cash and cash equivalents	254,754		(13,031)
Cash, cash equivalents and restricted cash at beginning of period	17,007		30,038
Cash, cash equivalents and restricted cash at end of period	$	271,761	$	17,007

See accompanying notes to the consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Nature of Business, Basis of Presentation and Summary of Significant Accounting Policies

Cumulus Media Inc. (and its consolidated subsidiaries, except as the context may otherwise require, "CUMULUS MEDIA," "we," "us," "our," or the "Company") is a Delaware corporation, organized in 2018, and successor to a Delaware corporation with the same name that was organized in 2002.

Nature of Business

CUMULUS MEDIA is a leading audio-first media and entertainment company delivering premium content to over a quarter billion people every month - wherever and whenever they want it. CUMULUS MEDIA engages listeners with high-quality local programming through 415 owned and operated stations across 86 markets; delivers nationally-syndicated sports, news, talk, and entertainment programming from iconic brands including the NFL, the NCAA, the Masters, CNN, the AP, the Academy of Country Music Awards, and many other world-class partners across nearly 7,300 affiliated stations through Westwood One, the largest audio network in America; and inspires listeners through its rapidly growing network of original podcasts that are smart, entertaining and thought-provoking. CUMULUS MEDIA provides advertisers with personal connections, local impact and national reach through broadcast and on-demand digital, mobile, social, and voice-activated platforms, as well as integrated digital marketing services, powerful influencers, full-service audio solutions, industry-leading research and insights, and live event experiences. CUMULUS MEDIA is the only audio media company to provide marketers with local and national advertising performance guarantees.

Basis of Presentation

Our consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States ("GAAP") and include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The Company has one reportable segment and presents the comparative periods on a consolidated basis to reflect the one reportable segment.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including significant estimates related to bad debts, intangible assets, income taxes, stock-based compensation, contingencies, litigation, valuation assumptions for impairment analysis, certain expense accruals and, if applicable, purchase price allocations. The Company bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances. We assessed these aforementioned estimates and judgments utilizing information reasonably available to us and considering the unknown future impacts of the novel coronavirus disease ("COVID-19") pandemic. The business and economic uncertainty resulting from the COVID-19 pandemic has made such estimates and assumptions more difficult to calculate. While there was not a material impact to our key estimates as of and for the year ended December 31, 2020, our estimates may change based on the magnitude and duration of COVID-19, as well as other factors. Actual amounts and results may differ materially from these estimates.

Comprehensive (Loss) Income

Comprehensive (loss) income includes net income and certain items that are excluded from net (loss) income and recorded as a separate component of stockholders' equity. During the years ended December 31, 2020 and 2019, the Company had no items of other comprehensive (loss) income and, therefore, comprehensive (loss) income does not differ from reported net (loss) income.

Cash and Cash Equivalents

The Company considered all highly liquid investments with original maturities of three months or less to be cash equivalents.

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Accounts Receivable, Allowance for Doubtful Accounts and Concentration of Credit Risk

Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in the Company's existing accounts receivable. The Company determined the allowance based on several factors, including the length of time receivables are past due, trends and current economic factors. All balances are reviewed and evaluated quarterly on a consolidated basis. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet credit exposure related to its customers. The Company performs credit evaluations of its customers as needed and believes that adequate allowances for any uncollectible accounts receivable are maintained.

Property and Equipment

Property and equipment are stated at cost. Major additions or improvements are capitalized, including interest expense when material, while repairs and maintenance are charged to expense when incurred. Property and equipment acquired in business combinations accounted for under the acquisition method of accounting are recorded at their estimated fair values on the date of acquisition. Equipment held under financing leases is stated at the present value of minimum future lease payments. Upon sale or retirement, the related cost and accumulated depreciation are removed from the accounts, and any gain or loss is recognized in the statement of operations. 

Depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the assets. Equipment held under financing leases and leasehold improvements are depreciated using the straight-line method over the shorter of the estimated useful life of the asset or the remaining term of the lease. Depreciation of construction in progress is not recorded until the assets are placed into service.

Impairment of Long-Lived Assets

Long-lived assets, such as property and equipment and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair value of the asset.

Intangible Assets

As of December 31, 2020, the Company's intangible assets were comprised of Federal Communications Commission ("FCC") licenses and certain other intangible assets. Intangible assets acquired in a business combination which are determined to have an indefinite useful life, including the Company's FCC licenses, are not amortized, but instead tested for impairment at least annually, or if a triggering event occurs. Intangible assets with definite useful lives are amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable.

In determining that the Company's FCC licenses qualified as indefinite lived intangibles, management considered a variety of factors including the FCC's historical record of renewing broadcasting licenses, the cost to the Company of renewing such licenses, the relative stability and predictability of the radio industry and the relatively low level of capital investment required to maintain the physical plant of a radio station. The Company's evaluation of the recoverability of its indefinite-lived assets, which include FCC licenses, is based on certain judgments and estimates. Future events may impact these judgments and estimates. If events or changes in circumstances were to indicate that an asset's carrying amount is not recoverable, a write-down of the asset would be recorded through a charge to operations.

Revenue Recognition

Revenue is derived primarily from the sale of commercial airtime to local and national advertisers. Revenues are recognized when control of the promised goods or services are transferred to the customer, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those good or services.

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Broadcast advertising revenue is recognized as commercials are broadcast. In those instances in which the Company functions as the principal in the transaction, the revenue and associated operating costs are presented on a gross basis. In those instances where the Company functions as an agent or sales representative, the effective commission is presented as revenue on a net basis with no corresponding operating expenses.

Advertising Costs

Advertising costs are expensed as incurred. For the years ended December 31, 2020 and 2019, the advertising costs incurred were $4.0 million and $6.0 million, respectively.

Local Marketing Agreements

A number of radio stations, including certain of our stations, have entered into Local Marketing Agreements ("LMAs"). In a typical LMA, the licensee of a station makes available, for a fee and reimbursement of its expenses, airtime on its station to a party which supplies programming to be broadcast during that airtime, and collects revenues from advertising aired during such programming. LMAs are subject to compliance with the antitrust laws and the Communications Laws, including the requirement that the licensee must maintain independent control over the station and, in particular, its personnel, programming, and finances.

As of December 31, 2020 and 2019, the Company operated one and two radio stations under LMAs, respectively. For the years ended December 31, 2020 and 2019, the stations operated under LMAs contributed $2.5 million and $3.5 million, respectively, to the consolidated net revenue of the Company.

Stock-based Compensation Expense

Stock-based compensation expense recognized for the years ended December 31, 2020 and 2019, was $3.3 million and $5.3 million, respectively. For awards with service conditions, stock-based compensation expense is recognized on a straight-line basis over the requisite service period for the entire award. In addition, the Company made an accounting policy election to recognize forfeitures of share-based awards as they occur in the period of forfeiture rather than estimating the number of awards expected to be forfeited at the grant date and subsequently adjusting the estimate when awards are actually forfeited. For stock options with service conditions only, the Company utilizes the Black-Scholes option pricing model to estimate the fair value of options issued. The fair value of stock options is determined by the Company's stock price, historical stock price volatility, the expected term of the award, risk-free interest rates and expected dividends. The fair value of time-based and performance-based restricted stock awards is the quoted market value of our stock on the grant date. For performance-based restricted stock awards, the Company evaluates the probability of vesting of the awards in each reporting period. In the event the Company determines it is no longer probable that the minimum performance criteria specified in the award will be achieved, all previously recognized compensation expense will be reversed in the period such a determination is made.

Trade and Barter Transactions

The Company provides commercial advertising inventory in exchange for goods and services used principally for promotional, sales, programming and other business activities. Programming barter revenue is derived from an exchange of programming content, to be broadcast on the Company's airwaves, for commercial advertising inventory, usually in the form of commercial placements inside the show exchanged. Trade and barter value is based upon management's estimate of the fair value of the products, supplies and services received. Trade and barter revenue is recorded when commercial spots are aired, in the same pattern as the Company's normal cash spot revenue is recognized. Trade and barter expense is recorded when goods or services are consumed. For the years ended December 31, 2020 and 2019, amounts reflected under trade and barter transactions were: (1) trade and barter revenues of $34.2 million and $45.3 million, respectively; and (2) trade and barter expenses of $33.6 million and $44.4 million, respectively.

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Income Taxes

The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates the Company expects will be applicable when those tax assets and liabilities are realized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recorded against a deferred tax asset to measure its net realizable value when it is not more-likely than-not that the benefits of its recovery will be recognized. The Company continually reviews the adequacy of our valuation allowance, if any, on our deferred tax assets and recognizes the benefits of deferred tax assets only as the reassessment indicates that it is more likely than not that the deferred tax assets will be recognized in accordance with ASC Topic 740, Income Taxes ("ASC 740").

The Company recognizes a tax position as a benefit only if it is more-likely-than-not that the position would be sustained in an examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that has a greater than 50% likelihood of being realized on examination. For tax positions not meeting the more-likely-than-not test, no tax benefit is recorded.

(Loss) Earnings Per Share

Basic (loss) earnings per share is computed on the basis of the weighted average number of common shares outstanding. The Company allocates undistributed net (loss) income from continuing operations between each class of common stock on an equal basis after any allocations for preferred stock dividends in accordance with the terms of the Company's third amended and restated certificate of incorporation, as amended (the "Charter").

Non-vested restricted shares of Class A common stock and outstanding warrants are considered participating securities for purposes of calculating basic weighted average common shares outstanding in periods in which the Company recorded net income. Diluted earnings per share is computed in the same manner as basic (loss) earnings per share after assuming the issuance of common stock for all potentially dilutive equivalent shares, which includes stock options and outstanding warrants to purchase common stock. Potentially dilutive shares are excluded from the computations of diluted earnings per share if their effect would be anti-dilutive. Under the two-class method, net (loss) income is allocated to common stock and participating securities to the extent that each security may share in earnings, as if all of the (loss) earnings for the period had been distributed. Earnings are allocated to each participating security and common share equally, after deducting dividends declared or accreted on preferred stock.

Fair Values of Financial Instruments

The carrying amounts of cash equivalents, restricted cash, accounts receivables, accounts payable, trade payables and receivables and accrued expenses approximate fair value because of the short term to maturity of these instruments.

Accounting for National Advertising Agency Contract

The Company has engaged Katz Media Group, Inc. ("Katz") as its national advertising sales agent. The Company's contract with Katz has several economic elements that principally reduce the overall expected commission rate below the stated base rate. The Company estimates the overall expected commission rate over the entire contract period and applies that rate to commissionable revenue throughout the contract period with the goal of estimating and recording a stable commission rate over the life of the contract.

The Company's accounting for and calculation of commission expense to be recognized over the life of the Katz contract requires management to make estimates and judgments that affect reported amounts of commission expense in each period. Actual results may differ from management's estimates.

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Supplemental Cash Flow Information

The following summarizes supplemental cash flow information to be read in conjunction with the Consolidated Statements of Cash Flows for the years ended December 31, 2020 and 2019 (dollars in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Supplemental disclosures of cash flow information:
Interest paid	$	62,513	$	76,846
Income taxes paid	5,775		18,590
Supplemental disclosures of non-cash flow information:
Trade revenue	34,203		$	45,308
Trade expense	33,604		44,378
Non-cash principal increase in financing liabilities	638		776
Reconciliation of cash and cash equivalents and restricted cash to the Consolidated Balance Sheet:
Cash and cash equivalents	$	271,761	$	15,142
Restricted cash	—		1,865
Total cash and cash equivalents and restricted cash	$	271,761	$	17,007

Restricted cash is used primarily to collateralize standby letters of credit for certain leases and insurance policies.

Adoption of New Accounting Standards

ASU 2018-13 - Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). In August 2018, the FASB issued ASU 2018-13, which eliminates, adds, and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. ASU 2018-13 is effective for all entities for fiscal years beginning after December 15, 2019, and interim periods therein, but entities are permitted to early adopt either the entire standard or only the provisions that eliminate or modify the requirements. The Company adopted ASU 2018-13 as of January 1, 2020 and there was no material impact to the Company's Consolidated Financial Statements.

Recent Accounting Standards Updates

ASU 2016-13 - Financial Instruments - Credit Losses (Topic 326) ("ASU 2016-13"). In June 2016, the FASB issued ASU 2016-13 which requires entities to estimate loss of financial assets measured at amortized cost, including trade receivables, debt securities and loans, using an expected credit loss model. The expected credit loss differs from the previous incurred losses model primarily in that the loss recognition threshold of "probable" has been eliminated and that expected loss should consider reasonable and supportable forecasts in addition to the previously considered past events and current conditions. Additionally, the guidance requires additional disclosures related to the further disaggregation of information related to the credit quality of financial assets by year of the asset's origination for as many as five years. Entities must apply the standard provision as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The standard was effective for public business entities, excluding Smaller Reporting Companies ("SRC"), for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The standard is effective for SRCs for fiscal years beginning after December 15, 2022. Early adoption is permitted for annual periods beginning after December 15, 2018, and interim periods within those fiscal years. The Company is currently evaluating the impact of adopting ASU 2016-13 on its Consolidated Financial Statements.

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2. Acquisitions and Dispositions

Tower Sale

On August 7, 2020, the Company entered into an agreement with Vertical Bridge REIT, LLC, for the sale of substantially all of the Company's broadcast communications tower sites and certain other related assets (the "Tower Sale"). On September 30, 2020, the Company completed the initial closing of the Tower Sale for $202.3 million in cash proceeds after transaction costs and closing adjustments. Pursuant to the Company's Term Loan Credit Facility due 2026 (as defined below), the Company was required to pay down at closing $49.0 million. As a result thereof, pursuant to the terms of the 6.75% Senior Secured First-Lien Notes due 2026 (as defined below), the Company made a tender offer (the "Tender Offer") with respect to the prorated portion of these proceeds of $47.2 million of the 6.75% Notes. On November 3, 2020, the Company accepted and paid for $47.2 million in aggregate principal amount of the 6.75% Notes that were validly tendered and not withdrawn in the Tender Offer.

In connection with the Tower Sale, the Company entered into individual site leases for the continued use of substantially all of the tower sites that were included in the Tower Sale, the general terms and conditions of which are contained in a master lease agreement that provides a framework for the individual leases with respect to each tower site. The initial term of each lease is 10 years, followed by five option periods of five years each. As the terms of the Tower Sale arrangement contains a repurchase option, the leaseback was not accounted for as a sale. Accordingly, the carrying amount of the leased back assets remains on the Company's books and continues to be depreciated over the remaining useful lives. The proceeds received for the leased back assets was recorded as a financing liability along with the remaining obligations for ground leases on these sites. Lease payments are recorded as a reduction of the financing liability and as interest expense. The Company records non-cash imputed rental income for tower sites where it continues to use a portion of the site along with other existing and future tenants. Transaction costs of $4.1 million were capitalized in Financing liabilities, net and are being amortized over the term of the lease.

The Company anticipates that one or more subsequent closings will be held for the assets comprising the remainder of the previously announced $213 million purchase price, subject to adjustment based upon due diligence and the curing of outstanding site defects. The Company anticipates that substantially all, if not all, of the subsequent closings will occur by the end of the second quarter of 2021.

See Note 13, "Leases" for further discussion related to the Company's failed sale-leasebacks as of December 31, 2020.

DC Land Sale

On June 24, 2020, the Company completed the previously announced sale of its DC Land (as defined below) to Toll Brothers. The sale generated net proceeds of $71.3 million, $5.0 million of which was received in 2019. The Company recorded a loss on the sale of the DC Land of $3.7 million which is included in the Loss (Gain) on Sale or Disposal of Assets or Stations financial statement line item of the Company's Consolidated Statements of Operations for the year ended December 31, 2020.

WABC Sale

On March 1, 2020, the Company completed the previously announced WABC Sale (as defined below) for $12.0 million in cash. The Company recorded a loss on the WABC Sale of $0.9 million which is included in the Loss (Gain) on Sale or Disposal of Assets or Stations financial statement line item of the Company's Consolidated Statements of Operations for the year ended December 31, 2020.

Entercom Asset Exchange

On May 9, 2019, the Company completed its previously announced swap agreement with Entercom ("Entercom Swap"). In connection with the agreement, the Company received WNTR-FM, WXNT- AM, and WZPL-FM in Indianapolis, IN and Entercom received WNSH-FM (New York, NY) and WMAS-FM and WHLL-AM (both in Springfield, MA). During the third quarter of 2019, the Company completed the accounting for the Entercom Swap.

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The table below summarizes the purchase price allocation for the Entercom Swap (dollars in thousands):

Assets Acquired
Broadcast licenses	$	20,790
Property and equipment, net	1,711
Total assets acquired	$	22,501
Assets Disposed
Broadcast licenses	$	(23,565)
Property and equipment, net	(703)
Other intangibles	(395)
Total assets disposed	$	(24,663)

The Company recognized a loss on the exchange in the amount of $2.2 million, which is included in the Loss (Gain) on Sale or Disposal of Assets or Stations financial statement line item of the Company's Consolidated Statement of Operations for the year ended December 31, 2019.

Connoisseur Media Asset Exchange

On June 26, 2019, the Company completed its previously announced swap agreement with Connoisseur Media (the "Connoisseur Swap"). In connection with the agreement, the Company received WODE-FM, WWYY-FM, WEEX-AM and WTKZ-AM in and around Allentown, PA and Connoisseur Media received WEBE-FM in Westport, CT, and WICC-AM in Bridgeport, CT.

The carrying amount of the assets transferred to Connoisseur Media as part of the Connoisseur Swap was approximately $3.7 million. During the third quarter of 2019, the Company completed the accounting for the Connoisseur Swap. No gain or loss was recognized on the Connoisseur Swap for the year ended December 31, 2019, because the fair value of assets acquired in the Connoisseur Swap was approximately equal to the carrying amount of the assets transferred.

Educational Media Foundation Sale

On May 31, 2019, the Company completed its previously announced sale of six radio stations, WYAY-FM (Atlanta, GA), WPLJ-FM (New York, NY), KFFG-FM (San Francisco, CA), WZAT-FM (Savannah, GA), WXTL-FM (Syracuse, NY), and WRQX-FM (Washington, DC) to Educational Media Foundation for $103.5 million in cash (the "EMF Sale"). The Company recorded a gain of $47.6 million on the sale which is included in the Loss (Gain) on Sale or Disposal of Assets or Stations financial statement line item of the Company's Consolidated Statements of Operations for the year ended December 31, 2019.

Meruelo Media Sale

On July 15, 2019, the Company completed its previously announced sale of KLOS-FM in Los Angeles, CA to Meruelo Media for $43.0 million in cash (the "KLOS Sale"). Prior to the completion of the sale, Meruelo Media began programming KLOS-FM under a Local Marketing Agreement on April 16, 2019. The Company recorded a gain of $10.5 million on the sale which is included in the Loss (Gain) on Sale or Disposal of Assets or Stations financial statement line item of the Company's Consolidated Statements of Operations for the year ended December 31, 2019.

3. Revenues

Revenue Recognition

Revenues are recognized when control of the promised goods or services are transferred to the customer, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.

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The following table presents revenues disaggregated by revenue source (dollars in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Advertising revenues	$	801,394	$	1,096,705
Non-advertising revenues	14,824		16,740
Total Revenue	$	816,218	$	1,113,445

Advertising Revenues

Substantially all of the Company's revenues are from advertising, primarily generated through (i) the sale of broadcast radio advertising time and advertising and promotional opportunities across digital audio networks to local, regional, national and network advertisers and (ii) remote/event revenue. The Company considers each advertising element a separate contract, and thus a separate performance obligation, as a result of both the customer's and the Company's respective ability to stop transferring promised goods or services during the contract term without notice or penalty. Thus, revenue associated with these contracts is recognized at the time advertising or other services, for example hosting an event, is delivered.

The Company's payment terms vary by the type and location of customer and the products or services offered. The term between invoicing and when payment is due is generally not significant. There are no further obligations for returns, refunds or similar obligations related to the contracts. The Company records deferred revenues when cash payments including amounts which are refundable are received in advance of performance.

Non-Advertising Revenues

Non-advertising revenue does not constitute a material portion of the Company's revenue and primarily consists of licensing content, and to a lesser degree, tower rental agreements, satellite rental income and sublease income. Tower rental agreements typically range from one to five years with renewal clauses. Such agreements generally contain a stated recurring monthly amount due, which is recognized upon delivery of services or passage of time. These agreements generally contain a single performance obligation.

Variable Consideration

Certain customers may receive cash-based incentives or credits, which are accounted for as variable consideration. The Company estimates these amounts based on the expected amount to be provided to customers and reduces revenue recognized accordingly. The Company has not had, nor does it believe that there will be, significant changes to its estimates of variable consideration. In addition, variable consideration has not historically been material to the Company's financial statements.

Customer Options that Provide a Material Right

ASC 606 requires the allocation of a portion of a transaction price of a contract to additional goods or services transferred to a customer that are considered to be a separate performance obligation and provide a material right to the customer.

To satisfy the requirement of accounting for the material right, the Company considers both the transaction price associated with each advertising spot as well as the timing of revenue recognition for the spots. Customers are often provided bonus spots, which are radio advertising spots, free of charge, explicitly within the contract terms or implicitly agreed upon with the customer consistent with industry standard practices. The Company typically runs these bonus spots concurrent with paid spots. As the delivery and revenue recognition for both paid and bonus spots generally occur within the same period, the difference between the time of delivery and recognition of revenue is insignificant.

Principal versus Agent Considerations

In those instances in which the Company functions as the principal in a transaction, the revenue and associated operating costs are presented on a gross basis. In those instances where the Company functions solely as an agent or sales representative, the Company's effective commission is presented as revenue on a net basis with no corresponding operating expenses.

The Company maintains revenue sharing agreements and inventory representation agreements with various radio companies. For all revenue sharing and inventory representation agreements, the Company performs an analysis in accordance with ASC 606 to determine if the amounts should be recorded on a gross or net basis. The Company continues to record all

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revenue sharing agreements on a gross basis with the shared revenue amount recorded within Content costs in the Consolidated Statements of Operations and all inventory representation agreements in which the Company is acting solely as an agent on a net basis.

Capitalized Costs of Obtaining a Contract

The Company capitalizes certain incremental costs of obtaining contracts with customers which it expects to recover. For contracts with a customer life of one year or less, commissions are expensed as they are incurred. For new local direct contracts where the new and renewal commission rates are not commensurate, management capitalizes commissions and amortizes the capitalized commissions over the average customer life. These costs are recorded within Selling, general and administrative expenses in our Consolidated Statements of Operations. As of December 31, 2020 and 2019, the Company recorded an asset of approximately $5.8 million and $7.9 million, respectively, related to the unamortized portion of commission expense on new local direct revenue.

Amortization for the years ended December 31, 2020 and 2019, was $7.2 million and $6.1 million, respectively. No impairment losses have been recognized in the fiscal years ended December 31, 2020 and 2019.

4. Property and Equipment

Property and equipment consisted of the following as of December 31, 2020 and 2019 (dollars in thousands):

	Estimated Useful Life	December 31, 2020		December 31, 2019
Land	N/A	$	73,251	$	73,261
Broadcasting and other equipment	5 to 7 years	101,204		92,083
Computer and capitalized software costs	1 to 3 years	29,216		22,859
Furniture and fixtures	5 years	6,733		5,977
Leasehold improvements	5 years	28,630		27,118
Buildings	5 to 20 years	30,052		29,935
Construction in progress	N/A	10,789		23,353
Property and equipment, gross		279,875		274,586
Less: accumulated depreciation		(71,183)		(41,652)
Property and equipment, net		$	208,692	$	232,934

Depreciation expense for the years ended December 31, 2020 and 2019, was $31.8 million and $27.1 million, respectively.

The Company capitalizes certain costs related to software developed or obtained for internal use in accordance with ASC 350-40, Intangibles-Goodwill and Other-Internal Use Software. The Company evaluates these long-lived assets for impairment whenever circumstances arise that indicate the carrying amount of an asset may not be recoverable. The Company's strategic reassessment of a customized technology project resulted in a $4.1 million impairment of capitalized internally developed software costs which is recorded in the Impairment of Capitalized Software Development Costs financial statement line item of the Company's Consolidated Statements of Operations for the year ended December 31, 2020.

The table presented above does not reflect certain assets in the Company's Washington, DC and New York, NY markets, which have been classified as held for sale in the accompanying Consolidated Balance Sheet as of December 31, 2019. See below for further discussion regarding assets held for sale.

Assets Held for Sale

Long-lived assets to be sold are classified as held for sale in the period in which they meet all the criteria for the disposal of long-lived assets. The Company measures assets held for sale at the lower of their carrying amount or fair value less cost to sell.

 During the year ended December 31, 2015, the Company entered into an agreement for the sale of certain land located in Bethesda, MD used in conjunction with the Company's Washington, DC operations to Toll Brothers (the "DC Land"). The asset was classified as held for sale in the Consolidated Balance Sheet as of December 31, 2019.

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On September 18, 2019, the agreement was amended to, among other changes, adjust the purchase price to a total of $75.0 million. The Company recorded a $5.0 million impairment on the DC Land in the third quarter of 2019 to adjust the carrying amount of this asset to fair value. The impairment is included in the Impairment of Assets Held for Sale financial statement line item of the Company's Consolidated Statements of Operations for the year ended December 31, 2019. The sale was subject to various conditions and approvals, including, without limitation, the receipt by the buyer of certain required permits and approvals for its expected use of the land. On June 24, 2020, the Company completed the sale of DC Land to Toll Brothers. See Note 2, "Acquisitions and Dispositions" for additional discussion related to the sale.

On June 27, 2019, the Company announced that it had entered into an agreement to sell WABC-AM in New York, NY to Red Apple Media, Inc. (the "WABC Sale"). The closing of the WABC Sale was subject to various conditions. In conjunction with the 2019 annual impairment test of the FCC licenses, the Company recorded a $1.2 million impairment charge to adjust the carrying amount of the WABC FCC license to fair value during the fiscal year ended December 31, 2019. The impairment is included in the Impairment of Assets Held for Sale financial statement line item of the Company's Consolidated Statements of Operations. On March 1, 2020, the Company completed the WABC Sale. See Note 2, "Acquisitions and Dispositions" for additional discussion related to the WABC Sale.

As of December 31, 2020, the Company had no assets held for sale.

The major categories of these assets held for sale are as follows (dollars in thousands):

	December 31, 2019
	WABC Sale		DC Land		Total
Property and equipment, net	$	7,054	$	75,000	$	82,054
FCC license	4,573		—		4,573
Other intangibles, net	373		—		373
Total	$	12,000	$	75,000	$	87,000

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5. Intangible Assets

The Company's intangible assets are as follows (dollars in thousands):

	Indefinite-Lived				Definite-Lived								Total
Gross Carrying Amount	FCC licenses		Trademarks		Affiliate and producer relationships		Broadcast advertising		Tower income contracts		Other
Balance as of December 31, 2018	$	935,652	$	21,184	$	130,000	$	32,000	$	14,983	$	14,253	$	1,148,072
Acquisitions (See Note 2)	24,111		—		—		—		—		—		24,111
Dispositions	(107,973)		(1,065)		—		—		(1,065)		(710)		(110,813)
Assets held for sale (See Note 4)	(5,737)		(198)		—		—		(197)		(132)		(6,264)
Impairment charges	(15,563)		—		—		—		—		—		(15,563)
Other (a)	—		—		—		—		—		(2,220)		(2,220)
Balance as of December 31, 2019	$	830,490	$	19,921	$	130,000	$	32,000	$	13,721	$	11,191	$	1,037,323
Accumulated Amortization
Balance as of December 31, 2018	$	—	$	—	$	(6,894)	$	(3,733)	$	(971)	$	(7,287)	$	(18,885)
Amortization Expense	—		—		(11,818)		(6,400)		(1,558)		(4,881)		(24,657)
Dispositions	—		—		—		—		115		691		806
Other (a)	—		—		—		—		—		286		286
Balance as of December 31, 2019	$	—	$	—	$	(18,712)	$	(10,133)	$	(2,414)	$	(11,191)	$	(42,450)
Net Book Value as of December 31, 2019	$	830,490	$	19,921	$	111,288	$	21,867	$	11,307	$	—	$	994,873
	Indefinite-Lived				Definite-Lived								Total
Gross Carrying Amount	FCC licenses		Trademarks		Affiliate and producer relationships		Broadcast advertising		Tower income contracts		Other
Balance as of December 31, 2019	$	830,490	$	19,921	$	130,000	$	32,000	$	13,721	$	11,191	$	1,037,323
Impairment charges	(4,509)		—		—		—		—		—		(4,509)
Dispositions	(391)		(161)		—		—		(129)		(131)		(812)
Balance as of December 31, 2020	$	825,590	$	19,760	$	130,000	$	32,000	$	13,592	$	11,060	$	1,032,002
Accumulated Amortization
Balance as of December 31, 2019	$	—	$	—	$	(18,712)	$	(10,133)	$	(2,414)	$	(11,191)	$	(42,450)
Amortization Expense	—		—		(11,818)		(6,400)		(1,520)		—		(19,738)
Dispositions	—		—		—		—		32		131		163
Balance as of December 31, 2020	$	—	$	—	$	(30,530)	$	(16,533)	$	(3,902)	$	(11,060)	$	(62,025)
Net Book Value as of December 31, 2020	$	825,590	$	19,760	$	99,470	$	15,467	$	9,690	$	—	$	969,977

(a) Reclassification of leasehold intangibles to right of use assets related to the adoption of ASC 842.

Total amortization expense related to the Company's definite-lived intangible assets was $19.7 million and $24.7 million, for the years ended December 31, 2020 and 2019, respectively.

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As of December 31, 2020, future amortization expense related to the Company's definite-lived intangible assets was estimated as follows (dollars in thousands):

2021	$	19,728
2022	19,728
2023	15,995
2024	13,328
2025	13,328
Thereafter	42,520
Total definite-lived intangibles, net	$	124,627

Impairment Testing

The Company performs annual impairment testing of its indefinite-lived intangible assets as of December 31 of each year and on an interim basis if events or circumstances indicate that its indefinite-lived intangible assets may be impaired. At the time of each impairment test, if the fair value of the indefinite-lived intangible is less than its carrying amount, an impairment charge is recorded. As a result of the annual trademark impairment tests, there was no impairment in 2020 or 2019. The FCC license impairment test results are discussed below.

The Company reviews the carrying amount of its definite-lived intangible assets, primarily affiliate and producer relationships, for recoverability prior to its annual impairment test of its indefinite-lived intangible assets and whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. The Company considered the current and expected future economic and market conditions surrounding COVID-19, and other potential indicators of impairment.

Impairment Testing of FCC Licenses

Annual Impairment Test

A valuation analysis is conducted each year as of December 31 to test the Company's FCC licenses for impairment. The Company determined that its geographic markets are the appropriate unit of accounting for FCC license impairment testing and therefore the Company has combined its FCC licenses within each geographic market cluster into a single unit of accounting for impairment testing purposes. In order to determine the fair value of the FCC licenses, the Company utilized the income approach, specifically the Greenfield Method. This method values a license by calculating the value of a hypothetical start-up company that initially has no assets except the asset to be valued (the license). The estimated fair values of the FCC licenses represent the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between the Company and willing market participants at the measurement date. The estimated fair value also assumes the highest and best use of the asset by a market participant, and that the use of the asset is physically possible, legally permissible and financially feasible.

Projections used in the Greenfield Method for FCC broadcast licenses include significant judgments and assumptions relating to the mature operating profit margin for average stations in the markets where the Company operates, long-term revenue growth rate, and the discount rate. In estimating the value of the licenses, market revenue projections based on third-party radio industry data are obtained. Next, the percentage of the market's total revenue, or market share, that market participants could reasonably expect an average start-up station to attain, as well as the duration (in years) required to reach the average market share are estimated. The estimated average market share was computed based on market share data, by station type (i.e., AM and FM) and signal strength.

Below are the key assumptions used in our annual impairment assessments:

	December 31, 2020		December 31, 2019
Discount rate	7.3	%	8.0	%
Long-term revenue growth rate	(0.75)	%	(0.75)	%
Mature operating profit margin for average stations in the markets where the Company operates	20% – 30%		20% – 30%

As a result of the annual impairment test as of December 31, 2020, there was no impairment of broadcast licenses. As a result of the annual impairment test as of December 31, 2019, there was a $16.7 million impairment charge primarily related

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to a decrease in revenue projections for one market. Of the total impairment charge, $15.6 million is recorded within Impairment of Intangible Assets and the remainder is recorded within Impairment of Assets Held for Sale within the Consolidated Statements of Operations.

As of December 31, 2020, the carrying amount of the FCC licenses was $825.6 million and the FCC license fair value of four of the Company's 86 geographical markets exceeded the respective carrying amount by less than 10%. The aggregate carrying amount of the licenses relating to these markets was $43.7 million.

If the macroeconomic conditions of the radio industry or the underlying material assumptions are less favorable than those projected by the Company or if a triggering event occurs or circumstances change that would more likely than not reduce the fair value of FCC licenses below the amounts reflected in the Consolidated Balance Sheets, the Company may be required to recognize additional impairment charges in future periods.

The Company will continue to monitor changes in economic and market conditions related to COVID-19 and, if any events or circumstances indicate a triggering event has occurred, the Company will perform an interim impairment test of intangible assets at the appropriate time.

Interim Impairment Test

During the second quarter of 2020, management considered the current and expected future economic and market conditions surrounding COVID-19, the adverse impact on the trading value of the Company's publicly-traded equity and on the Company's second quarter 2020 results, the continuing uncertainty surrounding the duration and magnitude of the economic impact of the pandemic and other potential indicators of impairment and determined a triggering event occurred which necessitated an interim impairment test as of June 30, 2020.

The interim impairment test was conducted using market revenue projections based on third-party radio industry data and the methodology described above. Below are the key assumptions used in the interim impairment assessment:

	June 30, 2020
Discount rate	8.0	%
Long-term revenue growth rate	(0.75)	%
Mature operating profit margin for average stations in the markets where the Company operates	20% – 30%

As a result of the interim impairment test as of June 30, 2020, the Company recorded a non-cash impairment charge of $4.5 million. The impairment charge is included in the Impairment of Intangible Assets financial statement line item within the Consolidated Statements of Operations.

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6. Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses consisted of the following (dollars in thousands):

	December 31, 2020		December 31, 2019
Accrued employee costs	$	20,638	$	26,417
Accrued third party content costs	23,470		31,006
Accounts payable	5,250		861
Accrued other	44,770		39,243
Total accounts payable and accrued expenses	$	94,128	$	97,527

7. Long-Term Debt

The Company's long-term debt consisted of the following (dollars in thousands):

	December 31, 2020		December 31, 2019
Term Loan due 2026	$	469,411	$	523,688
Less: current portion of Term Loan due 2026	(5,250)		(5,250)
6.75% Senior Notes	452,836		500,000
2020 Revolving Credit Facility	60,000		—
Less: Total unamortized debt issuance costs	(9,336)		(11,945)
Total long-term debt, net, excluding current maturities	$	967,661	$	1,006,493

Future maturities of the Term Loan due 2026, 6.75% Senior Notes and 2020 Revolving Credit Facility are as follows (dollars in thousands):

2021	$	5,250
2022	5,250
2023	5,250
2024	5,250
2025	65,250
Thereafter	895,997
Total	$	982,247

Refinanced Credit Agreement (Term Loan due 2026)

On September 26, 2019, the Company entered into a new credit agreement by and among Cumulus Media New Holdings Inc., a Delaware corporation and an indirect wholly-owned subsidiary of the Company ("Holdings"), certain other subsidiaries of the Company, Bank of America, N.A., as Administrative Agent, and the other banks and financial institutions party thereto as Lenders (the "Refinanced Credit Agreement"). Pursuant to the Refinanced Credit Agreement, the lenders party thereto provided Holdings and its subsidiaries that are party thereto as co-borrowers with a $525.0 million senior secured Term Loan (the "Term Loan due 2026"), which was used to refinance the remaining balance of the then outstanding term loan (the "Term Loan due 2022").

Amounts outstanding under the Refinanced Credit Agreement bear interest at a per annum rate equal to (i) the London Inter-bank Offered Rate ("LIBOR") plus an applicable margin of 3.75%, subject to a LIBOR floor of 1.00%, or (ii) the Alternative Base Rate (as defined below) plus an applicable margin of 2.75%, subject to an Alternative Base Rate floor of 2.00%. The Alternative Base Rate is defined, for any day, as the per annum rate equal to the highest of (i) the Federal Funds Rate, as published by the Federal Reserve Bank of New York, plus 1/2 of 1.0%, (ii) the rate identified by Bank of America, N.A. as its "Prime Rate" and (iii) one-month LIBOR plus 1.0%. As of December 31, 2020, the Term Loan due 2026 bore interest at a rate of 4.75% per annum.

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Amounts outstanding under the Term Loan due 2026 amortize in equal quarterly installments of 0.25% of the original principal amount of the Term Loan due 2026 with the balance payable on the maturity date. The maturity date of the Term Loan due 2026 is March 26, 2026.

The Refinanced Credit Agreement contains representations, covenants and events of default that are customary for financing transactions of this nature. Events of default in the Refinanced Credit Agreement include, among others: (a) the failure to pay when due the obligations owing thereunder; (b) the failure to comply with (and not timely remedy, if applicable) certain covenants; (c) certain defaults and accelerations under other indebtedness; (d) the occurrence of bankruptcy or insolvency events; (e) certain judgments against Holdings or any of its subsidiaries; (f) the loss, revocation or suspension of, or any material impairment in the ability to use, any one or more of, any material FCC licenses; (g) any representation or warranty made, or report, certificate or financial statement delivered, to the lenders subsequently proven to have been incorrect in any material respect; and (h) the occurrence of a Change in Control (as defined in the Refinanced Credit Agreement). Upon the occurrence of an event of default, the Administrative Agent (as defined in the Refinanced Credit Agreement) may, with the consent of, or upon the request of the required lenders, accelerate the Term Loan due 2026 and exercise any of its rights as a secured party under the Refinanced Credit Agreement and the ancillary loan documents provided, that in the case of certain bankruptcy or insolvency events with respect to a borrower, the Term Loan due 2026 will automatically accelerate.

The Refinanced Credit Agreement does not contain any financial maintenance covenants. The Refinanced Credit Agreement provides that Holdings will be permitted to enter into either a revolving credit facility or receivables facility, subject to certain conditions (see below).

The Borrowers (as defined below) may elect, at their option, to prepay amounts outstanding under the Refinanced Credit Agreement without premium or penalty, except in a refinancing or repricing transaction prior to March 26, 2020, where the Borrowers would be required to pay a 1% premium. The Borrowers may be required to make mandatory prepayments of the Term Loan due 2026 upon the occurrence of specified events as set forth in the Refinanced Credit Agreement, including upon the sale of certain assets and from Excess Cash Flow (as defined in the Refinanced Credit Agreement).

Amounts outstanding under the Refinanced Credit Agreement are guaranteed by Cumulus Media Intermediate Holdings, Inc., a Delaware corporation and a direct wholly-owned subsidiary of the Company ("Intermediate Holdings"), and the present and future wholly-owned subsidiaries of Holdings that are not borrowers thereunder, subject to certain exceptions as set forth in the Refinanced Credit Agreement (the "Guarantors") and secured by a security interest in substantially all of the assets of Holdings, the subsidiaries of Holdings party to the Refinanced Credit Agreement as borrowers, and the Guarantors.

The issuance of the Term Loan due 2026 and repayment of the Term Loan due 2022 were evaluated in accordance with ASC 470-50-40 - Debt-Modifications and Extinguishments-Derecognition ("ASC 470-50-40"), to determine whether the refinancing transaction should be accounted for as a debt modification or extinguishment of the Term Loan due 2022. Each lender involved in the refinancing transaction was analyzed to determine if its participation was a debt modification or an extinguishment. Debt issuance costs for exiting lenders who chose not to participate in the Term Loan due 2026 were accounted for as extinguishments. Debt discounts and costs incurred with third parties for the issuance of the Term Loan due 2026 totaling $3.6 million for new lenders were capitalized and amortized over the term of the Term Loan due 2026. An additional $1.5 million of debt discount for the issuance of the Term Loan due 2026 was capitalized for continuing lenders deemed to be modified. These capitalized fees associated with new and continuing lenders are presented as cash flows from financing activities on the Consolidated Statements of Cash Flows. Costs incurred with third-parties for the issuance of the Term Loan due 2026 of $3.5 million related to modification for continuing lenders were expensed and included in Interest Expense in the Consolidated Statements of Operations.

On September 30, 2020, pursuant to the Term Loan due 2026, the Company was required to pay down at closing of the Tower Sale $49.0 million. As a result of the pay down, the Company wrote-off approximately $0.4 million of debt issuance costs related to the Term Loan due 2026. As of December 31, 2020, we were in compliance with all required covenants under the Refinanced Credit Agreement

2020 Revolving Credit Agreement

On March 6, 2020, Holdings and certain of the Company's other subsidiaries, as borrowers (the "Borrowers"), and Intermediate Holdings entered into a $100.0 million revolving credit facility (the "2020 Revolving Credit Facility") pursuant to a Credit Agreement (the "2020 Revolving Credit Agreement"), dated as of March 6, 2020, with Fifth Third Bank, as a lender and Administrative Agent and certain other lenders from time to time party thereto. The 2020 Revolving Credit Facility refinances and replaces the Company’s 2018 Revolving Credit Agreement (as defined below) entered into pursuant to that

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certain Credit Agreement dated as of August 17, 2018, by and among Holdings, the Borrowers, Intermediate Holdings and certain lenders and Deutsche Bank AG New York Branch, as a lender and Administrative Agent.

The 2020 Revolving Credit Facility has a maturity date of March 6, 2025. Availability under the 2020 Revolving Credit Facility is tied to a borrowing base equal to 85% of the accounts receivable of the Borrowers, subject to customary reserves and eligibility criteria and reduced by outstanding letters of credit. Under the 2020 Revolving Credit Facility, up to $10.0 million of availability may be drawn in the form of letters of credit and up to $10.0 million of availability may be drawn in the form of swing line loans.

Borrowings under the 2020 Revolving Credit Facility bear interest, at the option of Holdings, based on LIBOR plus a percentage spread of 1.00% or the Alternative Base Rate. The Alternative Base Rate is defined, for any day, as the per annum rate equal to the rate identified as the "Prime Rate" by Fifth Third Bank. In addition, the unused portion of the 2020 Revolving Credit Facility will be subject to a commitment fee of 0.25%. The 2020 Revolving Credit Facility contains customary LIBOR successor provisions.

The 2020 Revolving Credit Agreement contains representations, covenants and events of default that are customary for financing transactions of this nature. Events of default in the 2020 Revolving Credit Agreement include, among others: (a) the failure to pay when due the obligations owing thereunder; (b) the failure to perform (and not timely remedy, if applicable) certain covenants; (c) certain defaults and accelerations under other indebtedness; (d) the occurrence of bankruptcy or insolvency events; (e) certain judgments against Intermediate Holdings or any of its subsidiaries; (f) the loss, revocation or suspension of, or any material impairment in the ability to use, any one or more of, any material FCC licenses; (g) any representation or warranty made, or report, certificate or financial statement delivered, to the lenders subsequently proven to have been incorrect in any material respect; and (h) the occurrence of a Change in Control (as defined in the 2020 Revolving Credit Agreement). Upon the occurrence of an event of default, the lenders may terminate the loan commitments, accelerate all loans and exercise any of their rights under the 2020 Revolving Credit Agreement and the ancillary loan documents as a secured party.

The 2020 Revolving Credit Agreement does not contain any financial maintenance covenants with which the Company must comply. However, if average excess availability under the 2020 Revolving Credit Facility is less than the greater of (a) 12.5% of the total commitments thereunder or (b) $10.0 million, the Company must comply with a fixed charge coverage ratio of not less than 1.0:1.0.

Amounts outstanding under the 2020 Revolving Credit Agreement are guaranteed by Intermediate Holdings and the present and future wholly-owned subsidiaries of Intermediate Holdings that are not borrowers thereunder, subject to certain exceptions as set forth in the 2020 Revolving Credit Agreement (the "2020 Revolver Guarantors") and secured by a security interest in substantially all of the assets of Holdings, the subsidiaries of Holdings party to the 2020 Revolving Credit Agreement as borrowers, and the 2020 Revolver Guarantors.

The issuance of the 2020 Revolving Credit Agreement was determined to be a modification of the 2018 Revolving Credit Agreement (as defined below) in accordance with ASC 470-50-40. The Company expensed approximately $0.6 million of unamortized debt issuance costs related to the exiting lender. Costs incurred with third parties for issuance of the 2020 Revolving Credit Agreement totaled approximately $0.4 million and were capitalized and will be amortized over the term of the 2020 Revolving Credit Agreement.

As of December 31, 2020, $65.1 million was outstanding under the 2020 Revolving Credit Facility, including letters of credit. As of December 31, 2020, the Company was in compliance with all required covenants under the 2020 Revolving Credit Agreement.

2018 Revolving Credit Agreement

On August 17, 2018, Holdings entered into a $50.0 million revolving credit facility (the "2018 Revolving Credit Facility") pursuant to a credit agreement (the "2018 Revolving Credit Agreement"), dated as of August 17, 2018, with certain subsidiaries of Holdings as borrowers, Intermediate Holdings as a guarantor, certain lenders, and Deutsche Bank AG New York Branch as a lender and Administrative Agent. The 2018 Revolving Credit Facility was scheduled to mature on August 17, 2023.

As of December 31, 2019, $2.9 million was outstanding in the form of letters of credit under the Revolving Credit Facility. The 2018 Revolving Credit Facility was terminated and replaced by the 2020 Revolving Credit Facility on March 6, 2020 (see above).

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6.75% Senior Notes

On June 26, 2019, Holdings (the "Issuer"), and certain of the Company's other subsidiaries, entered into an indenture, dated as of June 26, 2019 (the "Indenture") with U.S. Bank National Association, as trustee, governing the terms of the Issuer's $500,000,000 aggregate principal amount of 6.75% Senior Secured First-Lien Notes due 2026 (the "6.75% Senior Notes"). The 6.75% Senior Notes were issued on June 26, 2019. The net proceeds from the issuance of the 6.75% Senior Notes were applied to partially repay existing indebtedness under the Term Loan due 2022 (see above). In conjunction with the issuance of the 6.75% Senior Notes, debt issuance costs of $7.3 million were capitalized and are being amortized over the term of the 6.75% Senior Notes.

Interest on the 6.75% Senior Notes is payable on January 1 and July 1 of each year, commencing on January 1, 2020. The 6.75% Senior Notes mature on July 1, 2026.

The Issuer may redeem some or all of the 6.75% Senior Notes at any time, or from time to time, on or after July 1, 2022, at the following prices:

Year	Price
2022	103.7500	%
2023	101.6875	%
2024 and thereafter	100.0000	%

Prior to July 1, 2022, the Issuer may redeem all or part of the 6.75% Senior Notes upon not less than 30 nor more than 60 days prior notice, at 100% of the principal amount of the 6.75% Senior Notes redeemed plus a "make whole" premium.

The 6.75% Senior Notes are fully and unconditionally guaranteed by Intermediate Holdings and the present and future wholly-owned subsidiaries of Holdings (the "Senior Notes Guarantors"), subject to the terms of the Indenture. Other than certain assets secured on a first priority basis under the 2020 Revolving Credit Facility (as to which the 6.75% Senior Notes are secured on a second-priority basis), the 6.75% Senior Notes and related guarantees are secured on a first-priority basis pari passu with the Term Loan due 2026 (subject to certain exceptions) by liens on substantially all of the assets of the Issuer and the Senior Notes Guarantors.

The Indenture contains representations, covenants and events of default customary for financing transactions of this nature. As of December 31, 2020, the Issuer was in compliance with all required covenants under the Indenture. A default under the 6.75% Senior Notes could cause a default under the Refinanced Credit Agreement.

The 6.75% Senior Notes have not been and will not be registered under the federal securities laws or the securities laws of any state or any other jurisdiction. The Company is not required to register the 6.75% Senior Notes for resale under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or the securities laws of any other jurisdiction and is not required to exchange the 6.75% Senior Notes for notes registered under the Securities Act or the securities laws of any other jurisdiction and has no present intention to do so. As a result, Rule 3-10 of Regulation S-X promulgated by the SEC is not applicable and no separate financial statements are required for the guarantor subsidiaries.

On November 3, 2020, the Company completed the Tender Offer pursuant to which it accepted and cancelled $47.2 million in aggregate principal amount of the 6.75% Notes as a result of the Tower Sale. See Note 2, "Acquisitions and Dispositions" for additional discussion related to the Tender Offer. As a result of the Tender Offer, the Company wrote-off approximately $0.6 million of debt issuance costs related to the 6.75% Notes.

8. Fair Value Measurements

The three levels of the fair value hierarchy to be applied when determining fair value of financial instruments are described below:

Level 1 — Valuations based on quoted prices in active markets for identical assets or liabilities that the entity has the ability to access;

Level 2 — Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities; and

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Level 3 — Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The following table shows the gross amount and fair value of the Term Loan due 2026 and the 6.75% Senior Notes (dollars in thousands):

	December 31, 2020		December 31, 2019
Term Loan due 2026:
Gross value	$	469,411	$	523,688
Fair value - Level 2	460,023		528,684
6.75% Senior Notes:
Gross value	$	452,836	$	500,000
Fair value - Level 2	464,157		533,250

As of December 31, 2020, the Company used trading prices from a third party of 98.00% and 102.50% to calculate the fair value of the Term Loan 2026 and the 6.75% Senior Notes, respectively.

As of December 31, 2019, the Company used trading prices from a third party of 100.95% and 106.65% to calculate the fair value of the Term Loan 2026 and the 6.75% Senior Notes, respectively.

The fair value of the Company's 2020 Revolving Credit Facility as of December 31, 2020 approximates its carrying amount as a result of the market interest rates of this item and is classified as Level 3 within the fair value hierarchy.

Certain nonfinancial assets and liabilities are measured at fair value on a nonrecurring basis in accordance with applicable authoritative guidance. This includes items such as nonfinancial assets and liabilities initially measured at fair value in a business combination (but not measured at fair value in subsequent periods) and nonfinancial long-lived asset groups measured at fair value for an impairment assessment. In general, nonfinancial assets including intangible assets and property and equipment are measured at fair value when there is an indication of impairment and are recorded at fair value only when any impairment is recognized. See Note 4, "Property and Equipment" for further discussion.

9. Stockholders' Equity

Common Stock

Pursuant to the Company’s Charter, the Company is authorized to issue an aggregate of 300,000,000 shares of stock divided into three classes consisting of: (i) 100,000,000 shares of new Class A common stock; (ii) 100,000,000 shares of new Class B common stock; and (iii) 100,000,000 shares of preferred stock.

Each share of new Class A common stock is entitled to one vote per share on each matter submitted to a vote of the Company's stockholders. Except as provided below and as otherwise required by the Charter, the Company's bylaws or by applicable law, the holders of new Class A common stock shall vote together as one class on all matters submitted to a vote of stockholders generally (or if any holders of shares of preferred stock are entitled to vote together with the holders of common stock, as a single class with such holders of shares of preferred stock).

Holders of new Class B common stock are generally not entitled to vote such shares on matters submitted to a vote of the Company's stockholders. Notwithstanding the foregoing, holders of new Class B common stock are entitled to one vote per share of new Class B common stock, voting as a separate class, on any proposed amendment or modification of any specific rights or obligations that affect holders of new Class B common stock and that do not similarly affect the rights or obligations of the holders of new Class A common stock. In addition, holders of new Class B common stock are entitled to one vote per share of new Class B common stock, voting together with the holders of new Class A common stock, on each of the following matters, if and only if any such matter is submitted to a vote of the stockholders (provided that the Company may take action on any of the following without a vote of the stockholders to the extent permitted by law):

a.the retention or dismissal of outside auditors by the Company;

b.any dividends or distributions to the stockholders of the Company;

c.any material sale of assets, recapitalization, merger, business combination, consolidation, exchange of stock or other similar reorganization involving the Company or any of its subsidiaries;

d.the adoption of any new or amended charter;

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e.other than in connection with any management equity or similar plan adopted by the Board, any authorization or issuance of equity interests, or any security or instrument convertible into or exchangeable for equity interests, in the Company or any of its subsidiaries; and

f.the liquidation of the Company or any of its subsidiaries.

The Charter and bylaws do not provide for cumulative voting. The holders of a plurality of the shares of new common stock entitled to vote and present in person or represented by proxy at any meeting at which a quorum is present and which is called for the purpose of electing directors will be entitled to elect the directors of the Company. The holders of a majority of the shares of new common stock issued and outstanding and entitled to vote, and present in person or represented by proxy, will constitute a quorum for the transaction of business at all meetings of the stockholders.

Subject to the preferences applicable to any preferred stock outstanding at any time, if any, the holders of shares of new common stock shall be entitled to receive such dividends and other distributions in cash, property or shares of stock as may be declared thereon by the Board from time to time out of the assets or funds legally available; except that in the case of dividends or other distributions payable on the new Class A common stock or new Class B common stock in shares of such stock, including distributions pursuant to stock splits or dividends, only new Class A common stock will be distributed with respect to new Class A common stock and only new Class B common stock will be distributed with respect to new Class B common stock. In no event will any of the new Class A common stock or new Class B common stock be split, divided or combined unless each other class is proportionately split, divided or combined.

As of the date hereof, no shares of preferred stock are outstanding. The Charter provides that the Board may, by resolution, establish one or more classes or series of preferred stock having the number of shares and relative voting rights, designations and other rights, preferences, and limitations as may be fixed by them without further stockholder approval. The holders of any such preferred stock may be entitled to preferences over holders of common stock with respect to dividends, or upon a liquidation, dissolution, or the Company's winding up, in such amounts as are established by the resolutions of the Board approving the issuance of such shares.

The new Class B common stock is convertible at any time, or from time to time, at the option of the holders (provided that the prior consent of any governmental authority required to make such conversion lawful shall have been obtained and a determination by the Company has been made that the applicable holder does not have an attributable interest in another entity that would cause the Company to violate applicable law) into new Class A common stock on a share-for-share basis.

No holder of new common stock has any preemptive right to subscribe for any shares of the Company's capital stock issuable in the future.

If the Company is liquidated (either partially or completely), dissolved or wound up, whether voluntarily or involuntarily, the holders of new common stock shall be entitled to share ratably in the Company's net assets remaining after payment of all liquidation preferences, if any, applicable to any outstanding preferred stock.

As of December 31, 2020, the Company had 20,552,209 aggregate issued shares of common stock, and 20,377,987 outstanding shares consisting of: (i) 18,135,956 issued shares and 17,961,734 outstanding shares designated as Class A common stock; and (ii) 2,416,253 issued and outstanding shares designated as Class B common stock.

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Stock Purchase Warrants

On June 4, 2018 (the "Effective Date"), the Company entered into a warrant agreement (the "Warrant Agreement") with Computershare Inc., a Delaware corporation, and its wholly-owned subsidiary, Computershare Trust Company, N.A., a federally chartered trust company, as warrant agent. In accordance with the Plan and pursuant to the Warrant Agreement, on the Effective Date, the Company (i) issued 3,016,853 Series 1 warrants to purchase shares of new Class A common stock or new Class B common stock, on a one-for-one basis with an exercise price of $0.0000001 per share, to certain claimants with claims against our predecessor Company, CM Wind Down Topco, Inc. (formerly known as Cumulus Media, Inc.), and (ii) issued or will issue 712,736 Series 2 warrants to purchase shares of new Class A common stock or new Class B common stock on a one-for-one basis with an exercise price of $0.0000001 per share, to other claimants. Pursuant to an exchange process under the Warrant Agreement, on June 22, 2020, all outstanding warrants were converted into shares of Class A or Class B common stock, and 22,154 remaining Series 2 warrants authorized for issuance were converted into Series 1 warrants and remain outstanding.

Shareholder Rights Plan

On May 20, 2020, our Board adopted a rights plan and declared a dividend of (a) one Class A right (a "Class A Right") in respect of each share of the Company's Class A common stock, par value $0.0000001 per share (the "Class A Common Shares"), (b) one Class B right (a "Class B Right") in respect of each share of the Company's Class B common stock, par value $0.0000001 per share (the "Class B Common Shares" and together with the Class A Common Shares, the "Common Shares"), (c) one Series 1 warrant right (a "Series 1 Warrant Right") in respect of each of the Company's Series 1 warrants (the "Series 1 Warrants"), and (d) one Series 2 warrant right (a "Series 2 Warrant Right," and together with the Class A Rights, the Class B Rights and the Series 1 Warrant Rights, the "Rights") in respect of each of the Company's Series 2 warrants (the "Series 2 Warrants," and together with the Series 1 Warrants, the "Warrants"). The dividend distribution was made on June 1, 2020 to the Company's stockholders and Warrant holders of record on that date. The terms of the Rights and the rights plan are set forth in a Rights Agreement, dated as of May 21, 2020 (the "Rights Agreement"), by and between the Company and Computershare Trust Company, N.A., as rights agent (or any successor rights agent), as it may be amended from time to time.

In the event that a person or group that is or becomes the beneficial owner of 10% or more of the Company's outstanding Class A Common Shares (20% or more in the case of a passive institutional investor), subject to certain exceptions, (a) each Class A Right would allow its holder to purchase from the Company one one-hundredth of a Class A Common Share for a purchase price of $25.00, (b) each Class B Right would allow its holder to purchase from the Company one one-hundredth of a Class B Common Share for a purchase price of $25.00, (c) each Series 1 Warrant Right would allow its holder to purchase from the Company one one-hundredth of a Series 1 Warrant for a purchase price of $25.00, and (d) each Series 2 Warrant would allow its holder to purchase from the Company one one-hundredth of a Series 2 Warrant for a purchase price of $25.00.

After the date that the Rights become exercisable, a person or group that is or becomes the beneficial owner of 10% or more of the Company's outstanding Class A Common Shares (20% or more in the case of a passive institutional investor), all holders of Rights, except such beneficial owner, may exercise their (a) Class A Rights, upon payment of the applicable purchase price, to purchase Class A Common Shares (or other securities or assets as determined by the Board) with a market value of two times the applicable purchase price, (b) Class B Rights, upon payment of the applicable purchase price, to purchase Class B Common Shares (or other securities or assets as determined by the Board) with a market value of two times the applicable purchase price, (c) Series 1 Warrant Rights, upon payment of the applicable purchase price, to purchase Series 1 Warrants (or other securities or assets as determined by the Board) with a market value of two times the applicable purchase price, and (d) Series 2 Warrant Rights, upon payment of the applicable purchase price, to purchase Series 2 Warrants (or other securities or assets as determined by the Board) with a market value of two times the applicable purchase price. After the date that the Rights become exercisable, if a flip-in event has already occurred and the Company is acquired in a merger or similar transaction, all holders of Rights, except such beneficial owner, may exercise their Rights, upon payment of the purchase price, to purchase shares of the acquiring corporation with a market value of two times the applicable purchase price of the Rights.

In addition, after a person or group has become a beneficial owner of 10% or more of the Company's outstanding Class A Common Shares (20% or more in the case of a passive institutional investor), but before any person beneficially owns 50% or more of the Company's outstanding Class A Common Shares, the Board may exchange each Right (other than Rights that have become null and void) at an exchange ratio of (a) one Class A Common Share per Class A Right, (b) one Class B Common Share per Class B Right, (c) one Series 1 Warrant per Series 1 Warrant Right, and (d) one Series 2 Warrant per Series 2 Warrant Right. The Board may redeem all (but not less than all) of the Rights for a redemption price of $0.001 per Right at any time before the later of the date that the Rights become exercisable and the date of the Company's first public announcement or disclosure that a person or group has become a beneficial owner of 10% or more of the Company's

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outstanding Class A Common Shares (20% or more in the case of a passive institutional investor). Unless earlier redeemed or exchanged, the Rights will expire on April 30, 2021.

10. Stock-Based Compensation Expense

Share-Based Compensation

On April 30, 2020, our shareholders approved the Cumulus Media Inc. 2020 Equity and Incentive Plan ("2020 Plan"). The 2020 Plan is substantially similar in both form and substance of the Long-term Incentive Plan ("Incentive Plan") approved by the Board, which became effective as of the Effective Date. The purpose of the 2020 Plan is intended to, among other things, help attract, motivate and retain key employees and directors and to reward them for making major contributions to the success of the Company. The 2020 Plan permits awards to be made to employees, directors, or consultants of the Company or an affiliate of the Company.

Unless otherwise determined by the Board, the Board's compensation committee will administer the 2020 Plan. The 2020 Plan generally provides for the following types of awards:

•stock options (including incentive options and nonstatutory options);

•restricted stock;

•stock appreciation rights;

•dividend equivalents;

•other stock-based awards;

•performance awards; and

•cash awards.

The aggregate number of shares of Class A common stock that may be delivered under the 2020 Plan is 2,100,000 plus one Common Share that remains available for awards pursuant to the Incentive Plan. Such shares may be shares of original issuance or treasury shares or a combination of the foregoing. The aggregate number of shares of new Class A common stock that were reserved for issuance pursuant to the Incentive Plan was 2,222,223 on a fully diluted basis. Awards could be made under the Incentive Plan for a period of ten years from June 4, 2018, subject to the right of the stockholders and the Board to terminate the Incentive Plan at any time.

If an employee's employment is terminated by the Company or its subsidiaries without cause, by the employee for good reason (each, as defined in the award agreement) or by reason of death or disability (as defined in the award agreement), such employee will become vested in an additional tranche of the unvested awards as if the employee's employment continued for one additional year following the qualifying termination date; provided, that with respect to the Chief Executive Officer and Chief Financial Officer, (i) an amount equal to 50% of the unvested components of the awards will accelerate and vest and (ii) vested Options will remain outstanding until the expiration date of such Option. If an employee's employment is terminated by the Company or its subsidiaries without cause or by the employee for good reason, in either instance at any time within the three month period immediately preceding, or the twelve month period immediately following, a change in control (as defined in the award agreement), such employee will become vested in all unvested awards. We expect to issue common shares held as either treasury stock or issue new shares upon the exercise of stock options or once shares vest pursuant to restricted stock units.

Stock Options

The Options granted to Management during fiscal year 2020 have a five year contractual term and will vest ratably over four years on the anniversary of the date of grant. The Options granted to Management on or about the Effective Date will vest 30% on or about each of the first two anniversaries of the issuance date, and 20% will vest on or about each of the third and fourth anniversaries of the issuance date. The vesting of each of the awards to Management is also subject to, among other things, each employee's continued employment with the Company.

The Options granted to each non-employee director, which have a five year contractual term, vest in four equal installments on the last day of each calendar quarter, commencing in the quarter in which the award is granted. The vesting of each of the non-employee director awards are also subject to, among other things, each non-employee director's continued role as a director with the Company. Upon a change in control, all unvested non-employee director awards will fully vest.

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The following table summarizes changes in outstanding stock options during the twelve months ended December 31, 2020 and 2019, as well as stock options that are vested and expected to vest and stock options exercisable as of December 31, 2020 and 2019: 

	Options Outstanding
	Outstanding Stock Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands) (2)
Outstanding as of December 31, 2018	581,124	$	25.47	4.4	$	—
Granted	—	—			—
Exercised	—	—			—
Forfeited and canceled	(23,826)	25.70			—
Outstanding as of December 31, 2019	557,298	$	25.46	3.4	$	—
Exercisable as of December 31, 2019	180,424	$	24.97
Outstanding as of December 31, 2019	557,298	$	25.46	3.4	$	—
Granted	347,800	$	12.89		—
Exercised	—	—			—
Forfeited and canceled	(133,984)	$	24.52		—
Outstanding as of December 31, 2020	771,114	$	20.00	3.4	$	253
Exercisable as of December 31, 2020	271,103	$	25.22
(2) Amounts represent the difference between the exercise price and the fair value of common stock at each year end for all the "in-the-money" options outstanding based on the fair value per share of common stock as of each respective fiscal year end.

The per-share fair value of each stock option with service conditions only granted in 2020 was determined on the grant date using the Black-Scholes option pricing model with the following assumptions:

	Grant date
	2/13/2020		3/23/2020
Expected term (in years)	3.75		3.75
Risk-free interest rate	1.5	%	1.3	%
Expected volatility	46.9	%	68.2	%
Expected dividend yield	0	%	0	%

The expected term of stock options granted represents the weighted average period that the stock options are expected to remain outstanding and is based on the simplified method. Under the simplified method, the expected life of an option is presumed to be the midpoint between the vesting date and the end of the contractual term. We used the simplified method due to the lack of sufficient historical exercise data. The Company determined the expected term assumption based on estimates of the expected post-vesting holding period by employees. Expected volatility is based on the historical volatility of the Company's stock. The risk-free interest rate is based on the implied yield currently available on U.S. Treasury issues with terms approximately equal to the expected life of the option. The Company currently has no history or expectation of paying cash dividends on common stock.

There was $2.2 million of unrecognized compensation cost related to unvested stock options as of both December 31, 2020 and 2019. The weighted-average recognition period is 2.4 years for both periods.

RSUs

The fair value of time-based and performance-based restricted stock awards is the quoted market value of our stock on the grant date. For performance-based restricted stock awards, the Company evaluates the probability of vesting of the awards in each reporting period. In the event the Company determines it is no longer probable that the minimum performance criteria specified in the award will be achieved, all previously recognized compensation expense will be reversed in the period such a determination is made.

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The following table summarizes the activities for our RSUs for the years ended December 31, 2020 and 2019 and the related weighted-average grant date fair value:

	Number of RSUs	Weighted-Average Grant Date Fair Value
Nonvested as of December 31, 2018	477,968	$	15.00
Granted	248,155	14.16
Vested	(239,053)	15.22
Forfeited	(12,352)	14.84
Nonvested as of December 31, 2019	474,718	$	14.46
Granted	341,327	10.20
Vested	(212,193)	10.67
Forfeited	(230,721)	14.24
Nonvested as of December 31, 2020	373,131	$	12.65

As of December 31, 2020 and 2019, there was $3.5 million and $5.5 million, respectively, of unrecognized compensation cost related to unvested RSUs with a weighted-average recognition period of 1.9 years for both periods.

Stock-based compensation expense

The total stock-based compensation expense included in "Corporate expenses" in the accompanying Consolidated Statements of Operations was as follows (dollars in thousands):

    

	Year Ended December 31, 2020		Year Ended December 31, 2019
Stock option grants	$	1,044	$	1,326
Restricted stock unit grants	2,293		3,975
Total expense	$	3,337	$	5,301

The associated tax benefits related to these stock-based compensation awards for the years ended December 31, 2020 and 2019, was $0.9 million and $1.4 million, respectively.

The Company made an accounting policy election to recognize forfeitures of share-based awards as they occur in the period of forfeiture rather than estimating the number of awards expected to be forfeited at the grant date and subsequently adjusting the estimate when awards are actually forfeited.

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11. Income Taxes

Income tax (benefit) expense for the Company years ended December 31, 2020 and 2019, consisted of the following (dollars in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Current income tax expense
Federal	$	7,441	$	10,952
State and local	2,126		2,656
Total current income tax expense	$	9,567	$	13,608
Deferred income tax (benefit) expense
Federal	$	(21,799)	$	6,999
State and local	(7,017)		1,656
Total deferred tax (benefit) expense	(28,816)		8,655
Total income tax (benefit) expense	$	(19,249)	$	22,263

Total income tax (benefit) expense differed from the amount computed by applying the federal statutory tax rate of 21.0% for the years ended December 31, 2020 and 2019, as a result of the following (dollars in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Computed income tax expense at federal statutory rate on pre-tax (loss) income	$	(16,583)	$	17,539
State income tax expense, net of federal tax benefit	(3,753)		4,415
Bankruptcy costs	150		446
Section 162 disallowance	375		936
Provision to return	(152)		(1,564)
Other adjustments	714		491
Net income tax (benefit) expense	$	(19,249)	$	22,263

    

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The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below (dollars in thousands):

	December 31, 2020		December 31, 2019
Deferred income tax assets:
Accounts receivable	$	1,753	$	1,332
Leases	45,977		42,374
Other liabilities	4,777		4,980
Debt costs	1,132		841
Interest limitation	451		3,966
Financing liabilities	54,708		—
Net operating loss	39		—
Total deferred income tax assets before valuation allowance	108,837		53,493
Less: valuation allowance	—		—
Total deferred tax assets	$	108,837	$	53,493
Deferred income tax liabilities:
Intangible assets	$	27,586	$	12,992
Property and equipment	30,417		22,465
Leases	40,962		36,666
Other	2,093		2,408
Total deferred income tax liabilities	$	101,058	$	74,531
Total net deferred income tax assets (liabilities)	$	7,779	$	(21,038)

Deferred tax assets and liabilities are computed by applying the federal and state income tax rates in effect to the gross amounts of temporary differences between the tax and financial reporting bases of our assets and liabilities and other tax attributes. In assessing if the deferred tax assets will be realized, the Company considers whether it is more likely than not that some or all of these deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which these deductible temporary differences reverse.

As of December 31, 2020 and 2019, the Company did not record a valuation allowance because of the reversal of deferred tax liabilities of the Company and expected future taxable income.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (the "CARES Act") was signed into law. Among other provisions, the law provides relief to U.S. federal corporate taxpayers through temporary adjustments to net operating loss rules, changes to limitations on interest expense deductibility, and technical corrections to qualified improvement property. The Company recognized the effect of the changes in tax law on existing deferred tax assets and liabilities in income from continuing operations in the period ended December 31, 2020. The new legislation is retroactive. As a result, the effective tax rate for the current period and income taxes payable or receivable for the prior annual period was adjusted for the period ended December 31, 2020 resulting in a federal cash tax benefit of approximately $3.5 million and an immaterial state cash tax benefit.

As of December 31, 2020, the Company did not have federal interest expense disallowance carryforwards as a result of the change in the adjusted taxable income limitation pursuant to the CARES Act. The Company had state interest expense disallowance carryforwards in certain jurisdictions of $550.8 million, which are available to offset future taxable income and have an indefinite carryforward period.

The Company records interest and penalties related to uncertain tax positions in income tax expense. For interest and penalties, the Company recorded income tax expense of $0.2 million in each of the years ended December 31, 2020 and 2019. As of December 31, 2020 and 2019, the total interest and penalties accrued was $0.5 million and $0.3 million, respectively.

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The total uncertain tax positions and accrued interest and penalties as of December 31, 2020 and 2019 were $6.1 million and $5.9 million, respectively. The uncertain tax positions and accrued interest and penalties are presented as non-current liabilities, as payments are not anticipated within one year of the balance sheet date. These non-current income tax liabilities are recorded in other long-term liabilities in the Consolidated Balance Sheets. The $6.1 million as of December 31, 2020 represents the uncertain tax positions and accrued interest and penalties that, if recognized, would favorably affect the effective income tax rate in future periods. As of December 31, 2020, the Company does not believe that the uncertain tax positions will significantly change within the next 12 months as a result of the settlement of tax audits. Interest and penalties accrued on uncertain tax positions are released upon the expiration of statutes of limitations.

All federal income tax returns are closed for tax years through 2016. For the majority of state and local tax jurisdictions in which the Company is subject to income tax audits, tax years through 2016 have been closed.

The following table reconciles uncertain tax positions (dollars in thousands):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Balance at beginning of period	$	5,651	$	5,787
Decreases for prior year tax positions	—		(120)
Decreases relating to settlements with taxing authorities and other	(81)		(16)
Balance at end of period	$	5,570	$	5,651

12. (Loss) Earnings Per Share

The Company calculates basic (loss) earnings per share by dividing net (loss) income by the weighted average number of common shares outstanding, excluding unvested restricted shares. The Company calculates diluted (loss) earnings per share by dividing net (loss) income by the weighted average number of common shares outstanding plus the dilutive effect of all outstanding share-based awards, including stock options and restricted stock awards. Warrants generally are included in basic and diluted shares outstanding because there is little or no consideration paid upon exercise of the Warrants. For the twelve months ended December 31, 2020, due to the net loss attributable to the Company common stockholders, potential common shares that would cause dilution, such as employee stock options, restricted shares and other stock awards, have been excluded from the diluted share count because their effect would have been anti-dilutive. The Company applies the two-class method to calculate (loss) earnings per share. Because both classes share the same rights in dividends and earnings, (loss) earnings per share (basic and diluted) are the same for both classes.

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The following table presents the reconciliation of basic to diluted weighted average common shares (dollars in thousands, except per share data):

	Year Ended December 31, 2020		Year Ended December 31, 2019
Basic (Loss) Earnings Per Share
Numerator:
Undistributed net (loss) income from operations	$	(59,719)	$	61,257
Basic net (loss) income attributable to common shares	$	(59,719)	$	61,257
Denominator:
Basic weighted average shares outstanding	20,317		20,131
Basic undistributed net (loss) income per share attributable to common shares	$	(2.94)	$	3.04
Diluted (Loss) Earnings Per Share
Numerator:
Undistributed net (loss) income from operations	$	(59,719)	$	61,257
Diluted net (loss) income attributable to common shares	$	(59,719)	$	61,257
Denominator:
Basic weighted average shares outstanding	20,317		20,131
Effect of dilutive options and restricted stock units	—		153
Diluted weighted average shares outstanding	20,317		20,284
Diluted undistributed net (loss) income per share attributable to common shares	$	(2.94)	$	3.02

13. Leases

The Company has entered into various lease agreements both as the lessor and lessee. We determine if an arrangement is or contains a lease at contract inception and determine its classification as an operating or finance lease at lease commencement. The leases have been classified as either operating or finance leases in accordance with ASU 2016-02, Leases (Topic 842) and its related amendments (collectively, known as "ASC 842") and primarily consist of leases for land, tower space, office space, certain office equipment and vehicles. The Company also has sublease arrangements that provide a nominal amount of income. A right-of-use asset and lease liability have been recorded on the balance sheet for all leases except those with an original lease term of twelve months or less. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. As a lessor, we reserve the rights to the underlying assets in our agreements and do not expect to derive any amounts at the end of the lease terms. We have elected the practical expedient under ASC 842 to not separate lease and nonlease components for all classes of underlying assets.

The Company's leases typically have lease terms between five to ten years. Most of these leases include one or more renewal options for periods ranging from one to ten years. At lease commencement, the Company assesses whether it is reasonably certain to exercise a renewal option. Options that are reasonably certain of being exercised are factored into the determination of the lease term, and related payments are included in the calculation of the right-of-use asset and lease liability. The Company assumes that certain tower and land leases will be renewed for one additional term.

The Company uses its incremental borrowing rate to calculate the present value of lease payments. The incremental borrowing rate is based on a 1-year LIBOR rate plus an estimated credit spread consistent with our Refinanced Credit Agreement.

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The following table presents the Company's total right-of-use assets and lease liabilities as of December 31, 2020 and 2019 (dollars in thousands):

	Balance Sheet Location	December 31, 2020		December 31, 2019
Right-of-Use Assets
Operating	Operating lease right-of-use assets	$	157,568	$	143,436
Finance, net of accumulated amortization of $498 and $352 at December 31, 2020 and 2019, respectively	Other assets	496		380
Total Assets		$	158,064	$	143,816
Lease Liabilities
Current
Operating	Current portion of operating lease liabilities	$	28,121	$	34,462
Finance	Accounts payable and accrued liabilities	250		234
Noncurrent
Operating	Operating lease liabilities	129,273		111,184
Finance	Other liabilities	256		146
Total Liabilities		$	157,900	$	146,026

The following table presents the total lease cost for the years ended December 31, 2020 and 2019 (dollars in thousands):

	Statement of Operations Location	December 31, 2020		December 31, 2019
Operating Lease Cost	Selling, general and administrative expenses; Corporate expenses	$	33,439	$	37,750
Finance Lease Cost
Amortization of right-of-use assets	Depreciation and amortization	348		414
Interest on lease liabilities	Interest expense	40		42
Total Lease Cost		$	33,827	$	38,206

Total lease income related to our lessor arrangements was $2.1 million and $3.0 million for the years ended December 31, 2020 and 2019, respectively.

Other Supplementary Data

The following tables present other supplementary information for the years ended December 31, 2020 and 2019, respectively (dollars in thousands):

	December 31, 2020		December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	34,051	$	22,370
Operating cash flows from finance leases	40		42
Financing cash flows from finance leases	339		414
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	40,506	$	22,922

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	December 31, 2020		December 31, 2019
Weighted Average Remaining Lease Term (in years)
Operating leases	8.85		7.99
Finance leases	2.69		2.22
Weighted Average Discount Rate
Operating leases	6.68	%	7.45	%
Finance leases	6.22	%	7.44	%

As of December 31, 2020, future minimum lease payments, as defined under ASC 842, for the following five fiscal years and thereafter were as follows (dollars in thousands):

	Operating Leases		Finance Leases		Total
2021	$	28,106	$	253	$	28,359
2022	27,577		173		27,750
2023	26,045		61		26,106
2024	22,133		44		22,177
2025	18,972		15		18,987
Thereafter	85,883		—		85,883
Total lease payments	$	208,716	$	546	$	209,262
Less: imputed interest	(51,322)		(40)		(51,362)
Total	$	157,394	$	506	$	157,900

Future minimum payments related to the Company's failed sale-leasebacks as of December 31, 2020 were as follows (dollars in thousands):

	Tower Sale		Other		Total
2021	$	13,266	$	1,603	$	14,869
2022	13,664		1,650		15,314
2023	14,074		1,701		15,775
2024	14,496		1,751		16,247
2025	14,931		301		15,232
Thereafter	171,175		—		171,175
	$	241,606	$	7,006	$	248,612

Future minimum payments to be received under the Company's lessor arrangements as of December 31, 2020 were as follows (dollars in thousands):

	Operating Leases
2021	$	271
2022	245
2023	242
2024	160
2025	82
Thereafter	119
Total lease receivables	$	1,119

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14. Commitments and Contingencies

Future Commitments

The radio broadcast industry's principal ratings service is Nielsen Audio ("Nielsen"), which publishes surveys for domestic radio markets. Certain of the Company's subsidiaries have agreements with Nielsen under which they receive programming ratings information. The remaining aggregate obligation under the agreements with Nielsen is approximately $94.6 million as of December 31, 2020 and is expected to be paid in accordance with the agreements through December 2022.

The Company engages Katz as its national advertising sales agent. The national advertising agency contract with Katz contains termination provisions that, if exercised by the Company during the term of the contract, would obligate the Company to pay a termination fee to Katz, based upon a formula set forth in the contract.

The Company is committed under various contractual agreements to pay for broadcast rights that include sports and news services and to pay for talent, executives, research, weather information and other services.

The Company from time to time enters into radio network contractual obligations to guarantee a minimum amount of revenue share to contractual counterparties on certain programming in future years. As of December 31, 2020, the Company believes that it will meet all such material minimum obligations.

Legal Proceedings

We have been, and expect in the future to be, a party to various legal proceedings, investigations or claims. In accordance with applicable accounting guidance, we record accruals for certain of our outstanding legal proceedings when it is probable that a liability will be incurred and the amount of loss can be reasonably estimated. We evaluate, at least on a quarterly basis, developments in our legal proceedings or other claims that could affect the amount of any accrual, as well as any developments that would result in a loss contingency to become both probable and reasonably estimable. When a loss contingency is not both probable and reasonably estimable, we do not record a loss accrual.

If the loss (or an additional loss in excess of any prior accrual) is reasonably possible and material, we disclose an estimate of the possible loss or range of loss, if such estimate can be made. The assessment of whether a loss is probable or reasonably possible and whether the loss or a range of loss is estimable, involves a series of judgments about future events, which are often complex. Even if a loss is reasonably possible, we may not be able to estimate a range of possible loss, particularly where (i) the damages sought are substantial or indeterminate, (ii) the proceedings are in the early stages, (iii) the matters involve novel or unsettled legal theories or a large number of parties, or (iv) various factors outside of our control could lead to vastly different outcomes. In such cases, there is considerable uncertainty regarding the ultimate resolution of such matters, including the amount of any possible loss.

In August 2015, the Company was named as a defendant in two separate putative class action lawsuits relating to its use and public performance of certain sound recordings fixed prior to February 15, 1972 (the "Pre-1972 Recordings"). The first suit, ABS Entertainment, Inc., et. al. v, Cumulus Media Inc., was filed in the U.S. District Court for the Central District of California and alleged, among other things, copyright infringement under California state law, common law conversion, misappropriation and unfair business practices. On December 11, 2015, this suit was dismissed without prejudice. The second suit, ABS Entertainment, Inc., v. Cumulus Media Inc., was filed in the U.S. District Court for the Southern District of New York and claimed, among other things, common law copyright infringement and unfair competition. The New York lawsuit was stayed pending an appeal before the Second Circuit involving unrelated third parties over whether the owner of a Pre-1972 Recording holds an exclusive right to publicly perform that recording under New York common law. On December 20, 2016, the New York Court of Appeals held that New York common law does not recognize a right of public performance for owners of pre-1972 Recordings. As a result of that case (to which Cumulus Media Inc. was not a party) the New York case against Cumulus Media Inc., was voluntarily dismissed by the plaintiffs on April 3, 2017. On October 11, 2018, President Trump signed the Orrin G. Hatch-Bob Goodlatte Music Modernization Act (the "Music Modernization Act") into law, which, among other things, provides new federal rights going forward for owners of pre-1972 Recordings. The question of whether public performance rights existed for Pre-1972 recordings under state law prior to the enactment of the new Music Modernization Act is still being litigated in the Ninth Circuit as a result of a case filed in California. The Company is not a party to that case, and is not yet able to determine what effect that proceeding will have, if any, on its financial position, results of operations or cash flows. 

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In calendar year 2020, the FCC staff advised companies in the radio broadcast industry, including the Company, that it had been conducting an investigation into the timeliness of compliance with political file record keeping obligations by radio stations throughout the industry. The Company engaged in discussions with the FCC staff with respect to this investigation and on July 22, 2020, the FCC adopted a Consent Decree entered into by the Company with respect to such investigation. Under the Consent Decree, the Company agreed to implement a comprehensive compliance plan to ensure future compliance with the FCC's political file rules and to submit periodic compliance reports to the FCC. No fines were imposed on the Company as a result of the investigation, but there is no guarantee that fines will not be imposed in the future with regard to violations occurring during the period that the Consent Decree is in effect.

On May 17, 2018, after unsuccessful license fee negotiations between the Radio Music License Committee, Inc. ("RMLC") and Broadcast Music, Inc. ("BMI"), RMLC, on behalf of the FCC-licensed broadcast radio stations operating in the U.S. that it represents (the "Stations"), filed a petition for the determination of reasonable final license fees, case No. 18-cv-044420-LLS, in the U.S. District Court for the Southern District of New York. In the petition, RMLC requested that the court determine reasonable final fees and terms for a blanket license, an adjustable-fee blanket license, and a per-program license for the Stations on a retroactive basis for the period January 1, 2017 through December 31, 2021, and for such other and further relief as the court deems just and proper. RMLC negotiates music licensing fees with performing rights organizations on behalf of many U.S. radio stations, including Cumulus. On January 24, 2020, RMLC and BMI agreed to basic terms in a provisional settlement. The final agreement was reached on March 20, 2020. As a result of the final settlement, the Company accrued $1.7 million in the first quarter of 2020.

On February 24, 2020, two individual plaintiffs filed a putative class action lawsuit against the Company in the U.S. District Court for the Northern District of Georgia alleging claims regarding the Cumulus Media Inc. 401(k) Plan (the "Plan").  The case alleges that the Company breached its fiduciary duties under the Employee Retirement Income Security Act of 1974 (ERISA) in the oversight of the Plan, principally by selecting and retaining certain investment options despite their higher fees and costs than other available investment options, causing participants in the Plan to pay excessive recordkeeping fees, and by failing to monitor other fiduciaries. The plaintiffs seek unspecified damages on behalf of a class of Plan participants from February 24, 2014 through the date of any judgment. On May 28, 2020, the Company filed a motion to dismiss the complaint. On December 17, 2020 the Court entered an order dismissing one of the individual plaintiffs and all claims against the Company except those that arose on or after February 24, 2019 (i.e., one year prior to the filing of the Complaint). The Company intends to continue to defend the case vigorously. The Company is currently unable to reasonably estimate what effect the ultimate outcome might have, if any, on its financial position, results of operations or cash flows. 

On September 28, 2020, Westwood One and the National Collegiate Athletic Association and NIT, LLC (collectively "the NCAA"), filed competing lawsuits in the Indiana Commercial Court in Indianapolis, Indiana (the "Court"), with regard to the terms of that certain Radio Agreement between the parties dated January 13, 2011 (the "Radio Agreement"), that granted Westwood One exclusive rights to produce and distribute audio broadcasts for all NCAA and NIT championship events during the term of that agreement. Both lawsuits relate to annual rights fees applicable to championship events under the Rights Agreement that were cancelled in 2020 due to the COVID-19 pandemic and the subsequent termination of the Rights Agreement by the NCAA. The complaint filed by the NCAA alleges a breach of the Radio Agreement by Westwood One for non-payment of certain fees related to the events that were canceled and requests, among other things, a declaratory ruling that the termination of the Radio Agreement by the NCAA was permissible and that the NCAA is entitled to full payment of the annual rights fees under the Radio Agreement for the 2019-2020 contract year despite the cancellation of certain events. Westwood One filed its complaint seeking, among other things, a declaratory ruling that Westwood One was not obligated to pay the disputed annual rights fees due to the cancellation of the relevant events and that the NCAA was prohibited from terminating the Radio Agreement for such non-payment, and also requested a preliminary injunction seeking to enjoin the NCAA from terminating the Radio Agreement until the Court could make a determination on the issues raised by the lawsuits. By order dated October 23, 2020, the Court denied Westwood One's motion for preliminary injunction, but did not reach a conclusion on the merits of Westwood One's request for a declaratory ruling. On October 23, 2020, Westwood One filed an appeal of the Court's denial of its motion for preliminary injunction and intends to litigate both the NCAA lawsuit and the Westwood One lawsuit to conclusion. Notwithstanding the foregoing, Westwood One and the NCAA have entered into an agreement granting Westwood One exclusive rights to produce and distribute audio broadcasts of the 2020-21 college basketball season, including the NCAA championship event currently scheduled for April 2021. The Company is currently unable to reasonably estimate what effect the ultimate outcome of this litigation might have, if any, on its financial position, results of operations or cash flows.

The Company currently is, and expects that from time to time in the future it will be, party to, or a defendant in, various other claims or lawsuits (the "Other Claims") that are generally incidental to its business. The Company expects that it will vigorously contest any Other Claims and, although we are unable to reasonably estimate what effect the ultimate resolution of any known Other Claims might have, the Company does not believe that the ultimate resolution of any known Other Claims would have a material adverse effect on the Company's financial position, results of operations or cash flows.

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SCHEDULE II

CUMULUS MEDIA INC.

FINANCIAL STATEMENT SCHEDULE

VALUATION AND QUALIFYING ACCOUNTS

Fiscal Year (Dollars in thousands)	Balance at Beginning of Period		Charged to Costs and Expenses		Additions/(Deductions)		Balance at End of Period
Allowance for doubtful accounts
December 31, 2020	$	5,197	$	7,776	$	(6,228)	$	6,745
December 31, 2019	$	5,313	$	4,077	$	(4,193)	$	5,197

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