Cumulus Media - Chapter 11 Case Summary

Business Description

Headquartered in Atlanta, GA, Cumulus Media Inc. ("Cumulus Media"), along with its Debtor and non-Debtor affiliates (collectively, "Cumulus" or the "Company"), is a leading audio-first media company delivering premium content to approximately a quarter of a billion people every month through 394 owned-and-operated radio stations across 84 markets, national audio platforms, and an expansive suite of digital media offerings.

• The Company's national audio platforms include Westwood One, a leading national audio network in America, which distributes nationally syndicated sports, news, talk, and entertainment programming from iconic brands — including the NFL, the NCAA, the Masters, US Soccer, AP News, and the Academy of Country Music Awards — across more than 7,800 affiliated stations.
• Cumulus also operates the Cumulus Podcast Network, an established platform for original podcasts, as well as one of the largest streaming audio advertising networks in the United States.
• In addition, the Company offers an array of local digital marketing services to new and existing advertisers.

Cumulus generates revenue primarily from the sale of broadcast radio advertising time to local, regional, and national clients, supplemented by digital advertising and other ancillary revenue streams. The Company 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, full-service audio solutions, and live event experiences.

• Major advertiser categories include automotive, entertainment, financial, general services, home products, professional services, restaurants, retail, and telecommunications/media.

Cumulus Media has one operating and reportable segment, with centralized management of its executive, administrative, and support functions, including finance, accounting, legal, human resources, revenue management, marketing, and information technology.

As of the Petition Date, the Company employed approximately 3,000 people, including approximately 2,000 full-time employees. Of these, approximately 100 employees were covered by eight collective bargaining agreements. The Company also enters into contracts with many of its on-air personalities and podcast hosts, including, in certain instances, exclusive or semi-exclusive content syndication agreements.

Cumulus Media Inc. is a Delaware corporation, organized in 2018. Certain direct and indirect subsidiaries did not file for Chapter 11 relief, including eight companies that hold FCC licenses (the "Non-Debtor FCC License Holders") and two companies designated as "Non-Significant Subsidiaries" under the Debtors' prepetition debt documents. None of these non-debtor entities conduct material business operations, have employees, are obligors on prepetition funded debt, or have pledged assets in favor of prepetition secured lenders.

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Corporate History

Cumulus Media Inc. is the successor to CM Wind Down Topco Inc. (formerly known as Cumulus Media, Inc., "Old Cumulus"), a Delaware corporation originally organized in 2002. Old Cumulus and certain of its direct and indirect subsidiaries filed voluntary petitions for bankruptcy relief in November 2017 in the U.S. Bankruptcy Court for the Southern District of New York.

• Old Cumulus and its debtor subsidiaries emerged from Chapter 11 on June 4, 2018. Prior to winding down its business, Old Cumulus transferred substantially all of its remaining assets to an indirect wholly owned subsidiary of the reorganized Cumulus Media Inc., which was organized in 2018 as the successor entity.

Corporate Structure and Equity

Pursuant to its Charter, Cumulus Media Inc. is authorized to issue an aggregate of 300,000,000 shares of stock divided into three classes: 100,000,000 shares of Class A common stock, 100,000,000 shares of Class B common stock, and 100,000,000 shares of preferred stock.

• As of the Petition Date, the Company had 17,128,043 shares of Class A common stock and 312,041 shares of Class B common stock outstanding, with 5,815,111 shares held as treasury stock. No shares of preferred stock were outstanding.
• Shares of Class A common stock historically traded on the Nasdaq Global Market under the symbol "CMLS." However, trading was suspended on May 2, 2025, as part of Nasdaq's delisting procedures, at which point the Company's Class A common stock began trading on the OTC Markets' OTCQB market tier. There is no established public trading market for Class B common stock.

Subsidiaries, Joint Ventures, and Trusts

The Debtors own interests in various joint ventures and partnerships, none of which are Debtors. Most of these entities were created for the purpose of owning and operating physical radio assets, such as towers, antenna systems, or combiner systems.

The Debtors are also beneficiaries of a trust that holds for divestiture certain radio assets with de minimis value, in accordance with a Memorandum Opinion and Order released by the FCC.

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Operations Overview

Cumulus operates across three major revenue streams — broadcast radio, digital, and other revenue — supported by a broad portfolio of content platforms spanning local stations, the Westwood One network, the Cumulus Podcast Network, a leading streaming audio advertising network, and local digital marketing services.

Broadcast Radio Revenue

The majority of the Company's revenue is generated through the sale of terrestrial broadcast radio spot advertising time. Local and regional spot advertising is sold by Cumulus-employed sales personnel, while national spot advertising is marketed and sold by both the Company's internal national sales team and Katz Media Group, Inc. ("Katz") under an outsourced arrangement.

• The Company also monetizes available inventory in the network sales marketplace. To deliver network advertising effectively, Cumulus distributes content and programming through third-party affiliates to reach a broader national audience. In exchange for the right to broadcast radio network programming, affiliates typically remit a portion of their advertising time to the Company, which is then aggregated into demographic-focused packages and sold to national advertisers.
• The Company manages its on-air inventory of advertising time and adjusts pricing based on supply and demand. Each program has a general target level of on-air inventory available for advertising, which may vary at different times of the day but tends to remain stable over time.
• Advertising contracts are generally short-term in nature.

Digital Revenue

Cumulus generates digital advertising revenue through digital marketing services and the sale of advertising and promotional opportunities across its podcasting network, streaming audio network, websites, and mobile applications.

• The Company sells premium advertising adjacent to, or embedded in, podcasts through its network of owned and distributed podcasts.
• It operates one of the largest streaming audio advertising networks in the United States, including owned-and-operated internet radio simulcasted stations with either digitally inserted or simulcasted ads.
• The Company sells display ads across 394 local radio station websites, mobile applications, and ancillary custom client microsites.
• Additionally, Cumulus offers an array of campaign-based local digital marketing services, such as email marketing, geo-targeted display, video solutions, and search engine marketing, as well as subscription-based services including website building and hosting, social media management, reputation management, listing management, and search engine optimization.

Other Revenue

Other revenue includes trade and barter transactions, remote and event revenues, and non-advertising revenue. Non-advertising revenue represents fees received for licensing network content, imputed tower rental income, satellite rental income, and proprietary software licensing.

Advertising Sales Strategy

Each station's local sales staff solicits both broadcast and digital advertising, either directly from local advertisers or indirectly through advertising agencies. The Company uses a tiered commission structure to focus its sales staff on new business development.

• National spot advertising for the Company's radio stations is sold by Katz in exchange for a revenue-based commission. The national advertising agency contract with Katz contains termination provisions that, if exercised during the term, would obligate the Company to pay a termination fee based on a contractual formula.
• Regional sales are generally made by the Company's local sales staff and market managers to buyers that advertise in regions surrounding its markets.
• The Company's network sales team leverages scale, efficiency, and marquee brand content to sell inventory directly to national advertisers and their agencies across a wide spectrum of delivery platforms, with compensation tied to sales volume, new business development, and inventory mix.

Regulatory Environment

The ownership, operation, and sale of radio broadcast stations are subject to the jurisdiction of the Federal Communications Commission ("FCC"), which acts under authority of the Communications Act of 1934, as amended. The FCC issues permits and licenses to construct and operate radio stations, assigns broadcast frequencies, approves changes in ownership or control of station licenses, regulates transmission equipment and technical parameters, and has the authority to impose penalties for violations of its rules.

• The radio broadcast industry's principal ratings service is Nielsen, which publishes surveys for domestic radio markets. Certain of the Company's subsidiaries have previously entered into agreements with Nielsen to receive programming ratings information, though the renewal of such agreements is subject to pending litigation.

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Prepetition Obligations

As of the Petition Date, the Debtors report approximately $697.1 million in aggregate principal amount of funded debt obligations outstanding. The Company's prepetition capital structure comprises secured and unsecured funded debt as summarized below:

ABL Facility

• Approximately $55 million in principal and roughly $5 million in undrawn letters of credit are outstanding under a senior secured asset-based revolving credit facility with Fifth Third Bank, National Association, as administrative and collateral agent.
  • The ABL Facility provides for aggregate commitments of up to $125 million, with availability governed by a borrowing base equal to 85% of eligible accounts receivable, subject to customary reserves. Up to $15 million may be drawn as letters of credit and up to $10 million as swing line loans.
  • Borrowings bear interest, at the Company's election, at SOFR plus a 0.10% credit adjustment spread and a 1.00% applicable margin, or the Alternative Base Rate. A 0.25% commitment fee applies to the unused portion of the facility.
  • The ABL Facility matures on March 1, 2029, and is secured by a first-priority lien on ABL Priority Collateral (generally consisting of cash, accounts receivable, chattel paper, and related proceeds) and a third-priority lien on Term Loan Priority Collateral.

2029 Term Loans

• Approximately $311.8 million is outstanding under the 2029 Term Loan Credit Agreement with Bank of America, N.A., as administrative agent, entered into on May 2, 2024, as part of the 2024 Exchange Transactions.
  • The 2029 Term Loans bear interest at SOFR (subject to a 1.00% floor) plus a 5.00% margin, or the Alternative Base Rate plus a 4.00% margin. As of the Petition Date, the applicable interest rate was 8.901% per annum.
  • The facility matures in May 2029 and is secured by a first-priority lien on Term Loan Priority Collateral and a second-priority lien on ABL Priority Collateral.

2029 Secured Notes

• Approximately $306.4 million in aggregate principal amount of 8.00% senior secured first-lien notes due 2029 are outstanding under an indenture with U.S. Bank Trust Company, National Association, as trustee, also issued in connection with the 2024 Exchange Transactions.
  • The 2029 Notes mature on July 1, 2029, and are secured on a first-priority basis pari passu with the 2029 Term Loans on Term Loan Priority Collateral and on a second-priority basis on ABL Priority Collateral.
  • The notes are fully and unconditionally guaranteed by Intermediate Holdings and the present and future wholly-owned restricted subsidiaries of Holdings.

2026 Term Loans (Subordinated)

• A residual $1.2 million in principal remains outstanding under the 2026 Term Loan Credit Agreement, originally a $525 million senior secured term loan facility dated September 26, 2019, with Bank of America, N.A., as administrative agent.
  • The balance was substantially reduced through the 2024 Exchange Transactions and direct repayments. The 2026 Term Loans bear interest at SOFR plus a SOFR Adjustment (subject to a 1.00% floor) and a 3.75% margin; as of the Petition Date, the applicable rate was 7.687% per annum.
  • The facility matures on March 31, 2026. In connection with the 2024 Exchange Transactions, the liens securing the 2026 Term Loans were subordinated to those securing the 2029 Term Loans and the 2029 Notes pursuant to a Junior Lien Intercreditor Agreement.

2026 Senior Notes (Unsecured)

• Approximately $22.7 million in aggregate principal amount of 6.75% senior notes due 2026 remains outstanding under an indenture with U.S. Bank National Association, as trustee.
  • Originally issued at $500 million, the outstanding balance was significantly reduced through the 2024 Exchange Transactions and repayments. The 2026 Notes mature on July 1, 2026.
  • In connection with the 2024 Exchange Transactions, all collateral previously securing the 2026 Notes was released, rendering them fully unsecured.

Intercreditor Agreements

• The respective rights and priorities among the prepetition lenders and noteholders are governed by three intercreditor agreements, each dated May 2, 2024:
  • An ABL/Term Loan Intercreditor Agreement governing the relative lien priorities between the ABL Facility and the term loan and notes obligations;
  • A Pari Passu Intercreditor Agreement establishing the first-lien pari passu treatment between the 2029 Term Loans and the 2029 Notes; and
  • A Junior Lien Intercreditor Agreement subordinating the liens securing the 2026 Term Loans to those securing the 2029 Term Loans and the 2029 Notes.
• Under the intercreditor framework, the lien priority waterfall is as follows: the ABL Facility holds first priority on ABL Priority Collateral (cash, receivables, chattel paper, and related proceeds); the 2029 Term Loans and 2029 Notes share a first-priority pari passu lien on Term Loan Priority Collateral and a second-priority lien on ABL Priority Collateral; the ABL Facility holds a third-priority lien on Term Loan Priority Collateral; and the 2026 Term Loans are junior to all of the foregoing.

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Events Leading to Bankruptcy

Declining Broadcast Radio Industry and Macroeconomic Headwinds

• Following its emergence from prior chapter 11 cases in 2018, Cumulus Media pursued a repositioning strategy aimed at long-term viability. Despite meaningful progress, accelerating structural declines in the broadcast radio industry ultimately overwhelmed those efforts.
  • Intensifying competition from digital audio and streaming platforms, a shift toward programmatic and performance-based ad buying, and secular changes in listener behavior—including growing consumer preference for on-demand digital audio and widespread smartphone-to-car integration that facilitates streaming over AM/FM—placed sustained, industry-wide pressure on advertising demand and core broadcast revenues.
  • The COVID-19 pandemic sharply reduced commuting activity and primetime listening audiences. Although some recovery occurred as return-to-office trends emerged, hybrid work patterns have continued to depress drivetime listenership relative to historical norms—particularly in the large markets where the Company operates—and radio audiences remain well below pre-pandemic levels.
  • In parallel, billions of dollars in advertising budgets migrated from traditional radio into digital platforms, driving down revenues and profitability across the industry. Persistent inflation increased wages, content and production costs, and third-party service expenses, while elevated benchmark interest rates raised cash interest burdens and tightened credit availability.

Refinancing and Strategic Balance Sheet Initiatives

• To address these challenges and preserve liquidity, the Company undertook a multi-year sequence of strategic, operational, and balance sheet initiatives:
  • Management implemented recurring cost reductions, maintained strict working-capital discipline, and refocused investment on digital growth opportunities—including the Cumulus Podcast Network and local digital marketing services—to diversify revenue sources.
  • The Company reduced gross debt by approximately $630 million (~50% from 2018 levels), supported by an asset monetization program totaling approximately $510 million. That program included sales of ~$120 million of surplus land, ~$180 million of non-strategic stations, and ~$210 million of tower assets through selective divestitures structured to maintain market coverage and service continuity.
  • These efforts were complemented by approximately $120 million of cash generated from operations and opportunistic refinancings that lowered interest expense and extended maturities.
• In May 2024, to address near-term maturities, the Company consummated a series of exchange transactions (the "2024 Exchange Transactions") pursuant to a transaction support agreement with an ad hoc group representing approximately 80% of the then-outstanding 2026 Notes and approximately 97% of the then-outstanding 2026 Term Loans:
  • Approximately $328.3 million of the 2026 Term Loan was exchanged for approximately $311.8 million of new 2029 Term Loans, and approximately $323.0 million of the 2026 Notes was exchanged for approximately $306.4 million of new 2029 Notes.
  • In connection with the exchanges, the Company obtained consents to strip substantially all restrictive covenants and certain events of default from the 2026 Credit Agreement and the 2026 Notes Indenture, release all collateral securing the 2026 Notes, and subordinate liens securing the 2026 Term Loan. The Company also amended its ABL Facility to extend its maturity to March 1, 2029 and increase aggregate commitments from $100 million to $125 million.
  • While approximately 97% of 2026 Term Loan holders and 94% of 2026 Note holders participated, certain holders declined, leaving small "stub" amounts ($1.2 million of the 2026 Term Loan and $23.2 million of the 2026 Notes) outstanding and unaddressed.

Ongoing Operational Challenges and Liquidity Pressures

• Despite the breathing room afforded by the 2024 Exchange Transactions, the Company's operating results and liquidity continued to deteriorate. Demand in both national and local advertising markets remained weak, amplifying the Company's sensitivity to macroeconomic conditions. Higher interest expense, inflationary cost pressures, and restrictive debt covenants further constrained free cash flow and operational flexibility.
  • Throughout the second half of 2024 and into 2025, the Company undertook additional stabilization measures—including incremental fixed-cost reductions, streamlining of legacy operations, renegotiation of vendor arrangements, curtailment of non-essential capital expenditures, and selective draws under the ABL Facility to bridge periods of revenue volatility.
  • The Company also accelerated high-ROI digital initiatives and pursued incremental monetization of non-core assets. However, continued industry-wide declines in radio advertising revenue, elevated interest burdens, high fixed-cost contracts, and the cumulative impact of long-term listenership erosion outpaced the benefits of these measures, leading to mounting liquidity constraints.

Nielsen Litigation

• The Company's financial outlook was further exacerbated by a new network tying policy implemented by Nielsen Audio, the radio broadcast industry's principal ratings service, in late 2024. Nielsen is the exclusive provider of national radio ratings data—which network broadcasters rely on to sell advertising inventory—and the dominant provider of local radio ratings data.
  • Nielsen's new policy forced any customer owning both a national network and local radio stations to purchase local ratings data in all markets in which it operates as a prerequisite to accessing the complete national ratings product. This placed the Company in an untenable position: either assume substantially higher audience measurement costs by purchasing unwanted and uneconomic local ratings data, or lose access to the vital national ratings data that underpins Westwood One's ability to compete for national advertising.
  • After consensual negotiations with Nielsen failed, the Company filed a complaint in October 2025 in the U.S. District Court for the Southern District of New York. On December 30, 2025, the Company successfully obtained a preliminary injunction against the tying policy.
  • However, Nielsen appealed and on February 3, 2026, the Second Circuit granted a stay of the preliminary injunction pending appeal—restoring uncertainty and exposing the Company to coercive pricing at a critical juncture when 2026 advertising contracts were being negotiated, increasing the risk of lost customers and market share. On February 2, 2026, Nielsen also filed an answer and counterclaims in the underlying litigation, which remains pending.

Retention of Professionals and Governance Enhancements

• As the Company's challenges mounted, it engaged a roster of restructuring advisors to evaluate strategic alternatives:
  • In September 2025, the Company re-engaged Moelis & Company LLC as investment banker. In November and December 2025, respectively, Paul, Weiss, Rifkind, Wharton & Garrison LLP was retained as restructuring counsel and Alvarez & Marsal North America, LLC as financial advisor.
  • Together with management, these advisors analyzed the Company's capital structure, potential sources of liquidity, and available financial runway to address the Company's ability to service its debt obligations as they came due.
• On January 28, 2026, the Board appointed Ms. Carol Flaton as an independent director and formed two committees:
  • A special restructuring committee to assist with the evaluation of restructuring alternatives.
  • An investigation committee—with Ms. Flaton as its sole member—delegated sole and exclusive authority to conduct an independent review of potential claims against the Debtors' insiders and equity holders and to determine whether such claims should be pursued.

Stakeholder Engagement and RSA Negotiations

• In the last quarter of 2025, the Company and its advisors entered into discussions with an ad hoc group of secured lenders (the "Ad Hoc Group"), represented by Gibson, Dunn & Crutcher LLP and Guggenheim Securities, LLC, to explore a comprehensive restructuring of the Company's indebtedness. In early 2026, the Company also commenced discussions with the ABL Agent.
  • While the Company initially aimed to complete a recapitalization on an out-of-court basis, ongoing industry pressures caused it to pivot toward a prepackaged chapter 11 filing in early 2026. The Debtors determined that a prepackaged filing anchored by key stakeholder support would avoid a value-destructive freefall, minimize execution risk, reduce cost and disruption, and serve the best interests of all stakeholders.
• On March 4, 2026, after extensive arm's-length negotiations, the Debtors entered into a Restructuring Support Agreement (the "RSA") with Consenting 2029 Holders representing approximately 72.05% of the 2029 Debt Claims. The RSA contemplates an in-court restructuring through prepackaged chapter 11 cases and provides for:
  • A substantial deleveraging of the balance sheet by approximately $592 million.
  • A reduction in annual cash interest expense of approximately $49 million.
  • A streamlined capital structure designed to position the reorganized Company to compete effectively and pursue future strategic opportunities in the consolidating radio broadcast industry.
• On March 4, 2026, the Board established a Transaction Committee—comprising Elizabeth Abrams, David Tolley, and Steven M. Galbraith—with authority to oversee M&A transactions, asset sales, professional fee budgets, material contracts, additional financing, and material litigation settlements. Pursuant to the RSA, the Transaction Committee includes two new independent directors chosen by the Company from a slate of four nominees proffered by the Required Consenting 2029 Holders. The Transaction Committee's consent is required in connection with all Transaction Committee matters, though it cannot bind the Company to definitive agreements without full Board authorization.

Cash Collateral and ABL Commitment

• In parallel with the RSA negotiations, the Company engaged in discussions with the ABL Agent and the Ad Hoc Group regarding consensual use of cash collateral during the chapter 11 cases. Lenders constituting the requisite majority of ABL Loans, 2029 Term Loans, and 2029 Notes agreed to the Company's use of cash collateral in compliance with an approved budget, subject to certain permitted variances and milestones.
  • As of the Petition Date, the Debtors collectively hold approximately $46 million of cash on hand. The consensual cash collateral arrangement is expected to provide sufficient liquidity to fund ongoing operations and the administrative costs of the chapter 11 cases without the need for debtor-in-possession financing.
• On March 4, 2026, the Debtors and the ABL Parties entered into an Exit ABL Commitment Letter providing for up to $100 million in aggregate commitments under an amended and restated ABL Facility on terms substantially similar to the existing facility. Each holder of a claim under the existing ABL Facility has agreed to roll its claim under the restated agreement, ensuring the Company will have the financing needed to continue operations and execute on its business plan post-emergence.

Plan Treatment Summary (per RSA Term Sheet)

• The Restructuring Transactions contemplate the following treatment of claims and interests under the Plan:
  • ABL Facility Claims: Each holder receives its pro rata share of new loans under the Restated ABL Credit Facility in an amount equal to its allowed ABL Facility Claim. Impaired; entitled to vote.
  • 2029 Secured Claims: Allowed in the aggregate amount of $168,579,947. Each holder receives its pro rata share of (a) $50 million in Exit Convertible Notes and (b) New Common Stock and/or Special Warrants constituting 95% of the New Common Stock issued on the Effective Date, subject to dilution from the MIP. Impaired; entitled to vote.
  • Other Funded Debt Claims (comprising the 2026 Debt Claims, allowed at $24,192,471, and 2029 Deficiency Claims, allowed at $470,321,003): Each holder receives its pro rata share of New Common Stock and/or Special Warrants constituting 5% of the New Common Stock issued on the Effective Date, subject to dilution from the MIP; provided that distributions owing to 2026 Term Loan Lenders are turned over to 2029 Holders under the Junior Lien Intercreditor Agreement. Impaired; entitled to vote.
  • General Unsecured Claims: Paid in the ordinary course of business. Unimpaired; deemed to accept the Plan.
  • Existing Equity Interests: Cancelled on the Effective Date with no distribution, property, or other value to holders. Impaired; deemed to reject the Plan.
  • Intercompany Claims and Interests: Adjusted, continued, discharged, reinstated, or cancelled as determined by the Debtors in consultation with the Required Consenting 2029 Holders.
• The Reorganized Company will issue $50 million in secured Exit Convertible Notes bearing interest at either 10.00% PIK or 8.00% cash (at the Company's election), maturing five years after the Effective Date, and mandatorily convertible into New Common Stock upon any M&A Transaction at the midpoint equity value from the Plan's valuation analysis. The Exit Notes will be secured by a first-priority lien on certain shared collateral (including equity of the ultimate parent of the Reorganized Company) pari passu with the Restated ABL Facility, and are callable at par plus accrued interest.
• A management incentive plan ("MIP") will reserve 10% of the New Common Stock on a fully diluted basis, with terms to be determined by the New Board. The MIP must be allocated within 90 days of the Effective Date, failing which existing employee participants in the LTI Plan will have "Good Reason" to resign and receive contractual severance.