DEF 14A of Lee Enterprises, Inc, Jan 16, 2025

DEF 14A of Lee Enterprises, Inc

Filed Jan 16, 2025 · FY20240001628280-25-001707

Open on EDGAR

  1. PROPOSAL 1 - ELECTION OF DIRECTORS

    PROPOSAL 1 - ELECTION OF DIRECTORS At the Annual Meeting, three directors on our nine-member Board are to be elected for three-year terms expiring at the annual meeting in 2028. Each of the individuals named below is a nominee of the full Board for election as a director at the Annual Meeting. Our Board has examined the relationship between each of our non-employee directors and the Company and has determined that Dr. McAlmont; Mses Junck, Liberman, and McIntosh; and Messrs. Fletcher, Magid, Miller, and Moloney qualify as “independent” directors in accordance with The Nasdaq Stock Market LLC (“Nasdaq”) listing requirements (“Nasdaq rules”) and SEC rules. Each nominee has provided a consent permitting the Company to name such nominee in this Proxy Statement and stating that such nominee consents to serve if elected as a director, and the Board has no reason to believe that any nominee will be unable to serve. However, if, before the election, any nominee is unable to serve or for good cause will not serve (a situation that we do not anticipate), the proxy holders will vote the proxies for the remaining nominees and for substitute nominees chosen by the Board (unless the Board reduces the number of directors to be elected). If any substitute nominees are designated, we will file an amended proxy statement that, as applicable, identifies each substitute nominee, discloses that such nominee have consented to being named in the revised proxy statement and to serve if elected, and includes certain biographical and other information about such nominee required by the rules of the SEC. The Board recommends you vote FOR each of the Board’s nominees for director. The following material contains information concerning the Board’s nominees, including their period of service as a director, their recent employment, other directorships, including those held during the past five years with a public company or registered investment company, and age as of the Annual Meeting.

  2. NOMINEES FOR ELECTION AS DIRECTORS WITH TERMS EXPIRING IN 2028

    NOMINEES FOR ELECTION AS DIRECTORS WITH TERMS EXPIRING IN 2028

  3. Mary E. Junck, 77, Director since 1999

    Mary E. Junck, 77, Director since 1999 Mary E. Junck was elected Executive Chairman of the Company in February 2016 and elected Chairman in February 2019. She joined the Company in 1999 as Executive Vice President and Chief Operating Officer. She became president in 2000, Chief Executive Officer in 2001 and Chairman in January 2002, and served in those positions until her retirement in 2016. She previously held senior executive positions at the former Times Mirror Company, where she was responsible for the operations of Newsday, The Baltimore Sun (publisher and chief executive officer), the Hartford Courant, The Morning Call, Southern Connecticut Newspapers and St. Paul Pioneer Press (publisher and president). She also had responsibility for Times Mirror magazines and StayWell, Times Mirror’s consumer health company. She was a member of the board of directors of The Associated Press from 2004 to 2017 and was chairman from 2012 to 2017. Since October 2016, Ms. Junck has served as a director of Postmedia Network Canada Corp. (TSE: PNC.A), a public company based in Toronto, Canada, that owns numerous newspapers and associated online platforms throughout Canada. Ms. Junck’s in-depth knowledge of the Company and the publishing industry, in which she has worked in executive and senior management positions for more than 34 years, enables her to lead the Board effectively in her capacity as Chairman. Ms. Junck provides a valuable and unique perspective in Board deliberations about the Company’s business, competitive landscape, strategic relationships and opportunities, senior leadership and operational and financial performance. As Chairman, Ms. Junck serves as an advisor to the Chief Executive Officer and provides overall leadership for the Board. Her experience provides her with a thorough understanding of strategic direction and partnerships, financial matters and board management.

  4. Herbert W. Moloney III, 73, Director since 2001

    Herbert W. Moloney III, 73, Director since 2001 From December 2006 until his retirement in July 2011, Mr. Moloney was President and Chief Operating Officer of Western Colorprint, Inc., a privately held company that provided advertising supplements and commercial printing services to the publishing industry. From April 2005 to November 2006, Mr. Moloney was President and Publisher of the Washington Examiner. From 2000 to March 2005, Mr. Moloney was the Chief Operating Officer, North America, and an Executive Vice President of Vertis, Inc., a premium provider of targeted advertising and marketing solutions to leading retail and consumer services companies. Mr. Moloney is Chairman of the Executive Compensation Committee and a member of the Audit and Risk Management Committee and the Nominating and Corporate Governance Committee. Mr. Moloney has been designated as the Company’s Lead Director by the independent directors to preside over executive sessions of non-management directors, among other duties. Mr. Moloney brings to the Board more than 34 years of executive and management experience in the publishing and television industries. His extensive relevant industry and executive leadership experience provides him with substantive knowledge about a variety of issues that are related to the Company’s business, including digital and print advertising and marketing, operations and strategy development.

  5. Kevin D. Mowbray, 63, Director since 2016

    Kevin D. Mowbray, 63, Director since 2016 Mr. Mowbray was elected as the Company’s President and Chief Executive Officer (“CEO”) in February 2016. Prior to his election as CEO, Mr. Mowbray was the Company’s Executive Vice President and Chief Operating Officer from April 2015, and served as Vice President and Chief Operating Officer since 2013. He previously was publisher of the Company’s largest newspaper, the St. Louis Post-Dispatch, from 2006 to 2013, where he drove the Company’s digital efforts and piloted many significant digital products and initiatives. Mr. Mowbray is a member of the News Media Alliance board of directors, where he also serves on its executive committee and is the chair of the board of trustees of the American Press Institute. He is also a member of the board of directors of the Associated Press. As President and CEO, Mr. Mowbray has direct responsibility for all aspects of the Company’s operations, including more than 73 markets in 26 states and the corporate staff, with special focus on digital growth, revenue expansion and business transformation. His familiarity with the Company and his role in spearheading the development of our five-year strategic plan and digital strategies and overseeing our transformation, coupled with his 37 years of executive and management experience in the publishing industry, makes him a valuable addition to our Board.

  6. INCUMBENT DIRECTORS WITH TERMS EXPIRING IN 2026

    INCUMBENT DIRECTORS WITH TERMS EXPIRING IN 2026

  7. Margaret R. Liberman, 55, Director since 2019

    Margaret R. Liberman, 55, Director since 2019 Ms. Liberman was formerly Senior Vice President, News, Talk & Entertainment at SiriusXM (NASDAQ: SIRI), where she served from October 2017 until March 2023 and was responsible for content and strategic direction of the talk portfolio, overseeing 60 original and partner channels and all podcast programming produced under the Stitcher and Earwolf labels. Previously, she was Vice President and Editor in Chief of the Yahoo News Group from September 2013 to June 2017 and spent 13 years at The New York Times (NYSE: NYT), most recently as Deputy News Editor for Digital Development from 2010 to 2013. From 2001 to 2010, Ms. Liberman worked at The New York Times Magazine, first as a Story Editor before becoming Deputy Editor, where she oversaw numerous award-winning video and multimedia projects. Ms. Liberman began her career at a small children’s book publisher before assuming various editorial roles at Us Weekly, Swing Magazine, Martha Stewart Living, and Bridal Guide Magazine. Ms. Liberman earned a Bachelor of Arts degree from Barnard College in 1990 and a Master of Science degree from Columbia Graduate School of Journalism in 1995. Ms. Liberman is a member of the Nominating and Corporate Governance Committee. Ms. Liberman is a lifelong journalist and highly accomplished digital media executive. She brings top-tier experience and tremendous expertise developing and implementing effective digital platform strategies and directing award-winning editorial content. Her extensive experience and industry familiarity enables her to contribute effectively to the Board’s oversight of the Company’s strategy and operations.

  8. Brent M. Magid, 59, Director since 2010

    Brent M. Magid, 59, Director since 2010 Mr. Magid is President and Chief Executive Officer of Frank N. Magid Associates, Inc., a research-based strategy consulting company with expertise in a wide range of media. From 2007 to 2009, Mr. Magid served as a director of Quattro Wireless, a mobile advertising company. From 1989 to 1991, Mr. Magid worked in the entertainment group of JPMorgan Chase & Co. Mr. Magid is Chairman of the Nominating and Corporate Governance Committee and serves as a member of the Executive Compensation Committee. Mr. Magid provides the Board with experience and insight into key marketing and advertising trends and related media industry strategies, especially digital media and digital services. Also, Mr. Magid provides significant financial experience and contributes extensively to the oversight and integrity of the Company’s financial statements, risk management and risk assessment, ethics and compliance functions, and procedures and controls, which qualify him to serve as Chairman of the Company’s Audit and Risk Management Committee and as one of its designated financial experts.

  9. Jonathon F. Miller, 68, Director since 2024

    Jonathon F. Miller, 68, Director since 2024 Mr. Miller is a senior executive and investor at the intersection of technology and media. As chairman and CEO of AOL, Inc., he oversaw the world’s largest digital news site. As chairman and CEO of News Corp Digital Media Group, he was responsible for digital strategy and presence for all television and print publications globally. He has been president and CEO of USA Interactive (now IAC), and a partner in venture capital firm Advancit Capital with the chairman of Paramount Global, Shari Redstone, for the past ten years, where he has invested in more than 100 companies. He is senior media advisor to Global Citizen and its upcoming Global Live series of events. He is also an advisor to the Office of the Vice Provost for Advances in Learning at Harvard University, having previously served in that capacity with Harvard/MIT joint venture EdX. He has been honored as a UJA ‘Media Man of the Year’ and has also been awarded the Inaugural Pioneer Prize, Producers Guild of America, the Inaugural Vanguard Award, International Emmy Association, the Digital Power Player of the Year, Hollywood Reporter, and the Monaco Media Festival, Interactive Pioneer Award. Mr. Miller is a member of the Audit and Risk Management Committee. He has served as a director of public and private companies, including the boards of BBC News Worldwide, RTL Broadcasting, NY Public Radio, Akamai, Nielsen, First Look Media, Expedia, Trip Advisor and the Interpublic Group. He was executive producer of Live 8, the largest charity event ever produced and an advisor on a related follow up initiative, Live Earth.

  10. THE BOARD RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES RECOMMENDED BY OUR BOARD

    THE BOARD RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES RECOMMENDED BY OUR BOARD

  11. COMPENSATION OF NON-EMPLOYEE DIRECTORS

    COMPENSATION OF NON-EMPLOYEE DIRECTORS We desire to compensate our directors in a manner that is comparable to compensation levels at companies of similar size and in our industry The Executive Compensation Committee reviews proxy statements and other information from such companies and makes a recommendation for compensation of non-employee directors to the full Board for its approval. In 2019, the Executive Compensation Committee also requested a comprehensive report on director compensation from Korn Ferry, its independent consultant (the “Korn Ferry report”). In December 2019, upon the recommendation of the Executive Compensation Committee after review and analysis of industry peers’ board compensation practices and the Korn Ferry report, as part of the Board's ongoing review of the Company's governance practices, the Board approved the following Board compensation program: •Annual cash retainer to $100,000 in lieu of such fees; •Implementation of an annual cash retainer for the following committee chairs and Lead Director: •Lead Director $20,000 •Audit and ECC $15,000 •NCGC $10,000 •Implementation of non-employee director stock ownership guidelines, as reflected in the Company Corporate Governance Guidelines; and •Annual restricted stock awards under the LTIP to non-employee directors, with the 2020 stock award to be shares of our Common Stock with a fair market value of $50,000 on June 1, 2020, subject to shareholder approval of the 2020 Plan. At the 2020 Annual Meeting, the shareholders approved the LTIP, and the LTIP was implemented in March 2020 and remains in effect in 2024. In 2022, the annual restricted stock award to non-employee directors was increased to $60,000. Directors engaged to provide consultative services are normally compensated at the rate of $1,500 per day. None of our non-employee directors received compensation for consultative services in 2024. The following table summarizes non-employee director compensation for calendar year 2024:

  12. COMPENSATION OF NON-EMPLOYEE DIRECTORS

    | (Dollars) | Fees Earned or Paid in Cash(1) | Value of Stock Awards(2) | Total | | Steven C. Fletcher | 112,500 | 60,000 | 172,500 | | Margaret R. Liberman | 100,000 | 60,000 | 160,000 | | Brent M. Magid | 112,500 | 60,000 | 172,500 | | Shaun E. McAlmont | 100,000 | 60,000 | 160,000 | | Madeline E. McIntosh | 20,897 | — | 20,897 | | Jonathon F. Miller | 20,897 | — | 20,897 | | Greg P. Schermer | 41,667 | — | 41,667 | | Herbert W. Moloney lll | 135,000 | 60,000 | 195,000 | | David T. Pearson | 100,000 | 60,000 | 160,000 | | Mary E. Junck | 250,000 | 180,000 | 430,000 |

  13. COMPENSATION OF NON-EMPLOYEE DIRECTORS

    (1) Cash compensation in excess of the 2024 annual retainer represents payment for directors as a committee chair or, in the case of Mr. Moloney, for his service as Lead Director. (2) All restricted stock awards are fully vested on the first anniversary of the grant date. Restricted Stock awards are granted at a price equal to the fair market value of the date of the grant. The Board has authorized non-employee directors, prior to the beginning of any calendar year, to elect to defer receipt of all or any part of the cash compensation a director might earn during such year under our Outside Directors Deferral Plan (Amended and Restated as of January 1, 2008). Amounts so deferred will be paid to the director upon his or her separation from service, death, or disability, adjusted for any investment gains (or losses) thereon. Alternatively, directors may elect to have deferred compensation credited to a “rabbi trust” established by us with an independent trustee, which administers the investment of amounts so credited for the benefit and at the direction of the trust beneficiaries until their accounts are distributed under the deferred compensation plan. Amounts so credited for the benefit of non-employee directors are invested in investment alternatives selected by the director. None of our employees receives any compensation for serving as a director.

  14. Elements of Compensation

    | Element | Description | | Base Salary | •Determined based on numerous factors such as: | | | ◦Competitive conditions for the Names Executive Officer’s position within the peer group and in the broader employment market, | | | ◦as well as the Named Executive Officer’s level of responsibility, experience, and individual performance | | Annual Incentives | •Tied to annual business performance as measured against annual goals established by the ECC | | | •Varies depending on a wide range of factors, including: | | | ◦Competitive conditions for the executive officer’s position within the peer group and in the broader employment market, | | | ◦as well as the executive officer’s level of responsibility, experience, and individual performance | | Long-Term Incentives | The revised Long-Term Incentive Plan includes a mix of awards aligned to achieve the best practice of 50% time based and 50% performance based. The revised plan includes the following types of stock awards: | | | •Stock options — Offer the opportunity for executives to purchased shares at the grant date’s fair market value, with vesting over three years to encourage long-term commitment. | | | •Restricted stock awards — Each restricted stock unit represents the right to receive one ordinary share upon vesting. The restricted stock awards generally vest one-third on each of the first, second, and third anniversary of the grant date. | | | •Performance share units — reward executives based on the Company’s performance against pre-determined targets, reinforcing accountability to shareholders. Performance share unit represents the right to receive on ordinary share after the end of a three-year performance period if specified performance goals are achieved. |

  15. Objectives Of Our Compensation Program

    Objectives Of Our Compensation Program We intend for the Company to be an employer of choice, both in our industry and in the communities it serves. In order to achieve this status, our strategies are to have compensation programs in place that will: •Reward our executives for their contributions to the Company’s success; •Create an ownership mentality in our executives; •Focus our executives on building long-term value; •Permit us to recruit the talent we need; •Pay our executives are comparable levels with organizations with which the Company competes for talent; and •Encourage our top performers to remain with the Company. Our core compensation philosophy is to pay executive officers competitive levels of compensation that best reflect their individual responsibilities and contributions to the Company, while providing incentives to achieve its business and financial objectives. While comparisons to compensation levels at companies in the peer group (discussed below) are helpful in assessing the overall competitiveness of our compensation program, we believe that our executive compensation program also must be internally consistent and equitable in order for the Company to achieve the compensation objectives outlined above. In implementing this philosophy, we have analyzed the relationship between the CEO's total compensation and the total compensation of the other executive officers of the Company. For this purpose, total compensation includes not only base salary and bonus, but also the grant date fair value of equity awards (as well as accumulated realized and unrealized equity gains), all perquisites and payment amounts upon a change of control. The Company's Human Resources Department accumulates the internal pay equity information under our direction. When making compensation decisions, we also benchmark the compensation of the CEO and other NEOs relative to the compensation paid to similarly-situated executives at companies that we consider to be industry peers. We believe, however, that a benchmark should be one point of reference for measurement, but not the sole determinative factor for executive compensation. The purpose of the comparison is not to supplant the analysis of internal pay equity, wealth accumulation and the individual performance of the executive officers that we consider when making compensation decisions. Further, given the limitations associated with comparative pay information for setting individual executive compensation, including the difficulty of assessing and comparing wealth accumulation through equity gains and post-employment amounts, we may elect to not use the comparative compensation information at all in the course of making compensation decisions.

  16. Peer Group Information

    Peer Group Information We use market data for context and a frame of reference for decision-making, but it is not the sole source of information from which compensation is determined. We target the median of the market to establish the total compensation opportunity. We determine the market for the NEO positions to be comparable publicly traded publishing companies. We review the composition of the peer group annually to ensure that companies are relevant for comparative purposes. We factor in the relative size of these companies since size of the company generally correlates with compensation paid. We believe that the current group of companies noted below is representative of the sector in which the Company operates, and the group was chosen because of each company's relative position in the media sector, its relative size as measured by market capitalization and the relative complexity of the business and the CEO's role and responsibilities. These companies currently are: •Gannett Company, Incorporated; •TownSquare Media, Incorporated; •E. W. Scripps Company; •Tegna Incorporated; •The New York Times Company; and •Sinclair Broadcast Group Incorporated. The Company's Human Resources Department provides us with compensation data obtained from the proxy statements of each of these companies. We also utilize compensation data compiled by Equilar, Inc. We use outside compensation consultants from time to time to advise us on specific issues.

  17. How We Determine The Amount Of Compensation

    How We Determine The Amount Of Compensation The Company's By-Laws provide that the Board has the sole authority to determine the compensation of all officers of the Company who are elected or appointed by the Board. The Board has, by adoption of our charter, delegated that authority to us. In addition, the LTIP approved by the stockholders gives us the sole authority to establish equity awards for executive officers. The Executive Chairman, working primarily with the Company's Vice President - Human Resources, recommends all elements of compensation for all executive officers other than the Executive Chairman and CEO and we determine it. We determine Executive Chairman and CEO compensation without management input, other than the analysis of Executive Chairman and CEO compensation obtained from the peer publishing companies' proxy statements and other information obtained by the Human Resources Department at our request from independent sources. When making compensation decisions, we analyze compensation summaries prepared for each of the NEOs. These summaries are prepared by the Human Resources Department. Each summary presents the dollar amount of each component of the NEO's compensation, including current cash compensation (base salary and incentives), equity awards, retirement benefits and any other compensation. These summaries reflect the annual compensation for the NEOs (both target and actual). Potential payments upon termination of employment involving a change of control and long-term incentives accumulated by the NEOs are also reviewed.

  18. Changes to Executive Compensation

    Changes to Executive Compensation The main points of feedback from the investors’ with whom we engaged was the need for increased transparency, including more detailed disclosures about our executive compensation, Long-Term Incentive Plan restructuring, including the realignment of stock awards from 100% time-based awards to 50% time-based and 50% performance-based, and more detailed information on the company’s efforts to refresh the Board, including the addition of two new Board members in 2024. The ECC and Board carefully considered shareholder feedback and has implemented or proposed changes to our executive compensation, as summarized below. The below table details those efforts and other portions of this proxy statement, including the addition of a Compensation Discussion and Analysis within this proxy statement and the proposal of an amendment to our 2020 Long-Term Incentive Plan reflects the Board’s ongoing commitment to shareholder engagement and responsiveness.

  19. Changes to Executive Compensation

    | WHAT WE HEARD FROM SHAREHOLDERS | HOW WE RESPONDED | | Increased Transparency Investors expressed the need for more detailed disclosures about executive compensation | We added a Compensation Discussion & Analysis section within this Proxy Statement despite the fact that such disclosures are not required as a Smaller Reporting Company | | Long-Term Incentive Plan Restructuring Investors recommended aligning stock awards with best practices of mixing time-based awards with performance-based awards. | Base Salary We now use competitive benchmarking data from industry peers and broader market analysis along with internal equity, role responsibility, and individual performance to determine base salary Short-Term Incentive Bonuses We now determine executives’ annual bonuses by mixing Company-wide performance objectives, such as Adjusted EBIDTA (34%) and Digital Revenue (33%) with individual performance goals (33%) Long-Term Incentive Awards We now provides executives with a mix of time-based awards (50%) and performance-based awards (50%), including stock options, restricted stock awards, and performance share units. | | Board Refreshment Investors sought more information about the Board’s ongoing refreshment process. | We added two new Directors to the Board in 2024, and five new Board members since 2019, focusing on new board members having an expertise in digital transformation. |

  20. Annual Cash Incentive Plan For Named Executive Officers Other Than The CEO

    Annual Cash Incentive Plan For Named Executive Officers Other Than The CEO Annual cash incentives are designed to support our objective of delivering positive annual operating results. In order to achieve competitive annual incentive targets, our goal is to set bonus targets at levels where we can expect the executive to receive a competitive incentive payment six out of ten years - in two out of ten years payments received would exceed competitive levels, and in two out of ten years, payments would be lower than competitive levels. The 2024 incentive plan for NEOs other than the CEO was based primarily upon achievement of Adjusted EBITDA (as defined below, “Adjusted EBITDA") and revenue tied to the Company’s Three Pillar Strategy, both relative to the current year operating plan ("Budget"). The Budget is approved annually by the Board. We have limited the NEOs' performance measures to Adjusted EBITDA and revenue tied to the Company’s Three Pillar Strategy in order to focus on cash flow and the related debt reduction to enhance stockholder value. Based on the Company's performance, in 2024, a participant was eligible to earn as a cash incentive bonus from 0% up to 200% of the financial target, which equates to 0% to 50% of the base salary for Mr. Millage and Mr. Bekke and 0% to 40% of the base salary of the other NEOs. A decline in Adjusted EBITDA from the Budget of more than 10% would result in no payment of an annual cash incentive. Achievement of the Adjusted EBITDA and revenue tied to the Company’s Three Pillar Strategy targets in the Budget would result in payment of up to 200% of the financial target. A tiered grid was used to determine results between the minimum and maximum, interpolating within each tier.

  21. Annual Cash Incentive Plan For The CEO

    Annual Cash Incentive Plan For The CEO Based on the Company's performance, in 2024 Mr. Mowbray was eligible to earn from 0% up to 100% of the financial bonus target, which equates to 0% to 200% of their respective base salaries, as a cash incentive bonus. A decline in Adjusted EBITDA and revenue tied to the Company’s Three Pillar Strategy from the Budget of more than 10% would result in no payment of an annual cash incentive. Achievement of the Adjusted EBITDA and revenue tied to the Company’s Three Pillar Strategy targets in the Budget would result in payment of 50% of the financial target each. A tiered grid was used to determine results between the minimum and maximum, interpolating within each tier. Based on the Company’s performance, no bonus was achieved in 2024.

  22. Discretionary Bonuses

    Discretionary Bonuses From time to time, we also develop special incentive programs and approve the Executive Chairman's recommendation of discretionary bonuses to the NEOs (excluding the CEO), and approve discretionary bonus awards to the CEO, based on exceptional performance. 2024 annual cash incentive plan and other bonus payments are summarized as follows:

  23. Discretionary Bonuses

    | (Dollars) | Annual Incentive Plan | Annual Discretionary Awards | Total | | Kevin D. Mowbray | | | | | Award | — | — | — | | Target | 900,000 | | | | Timothy R. Millage | | | | | Award | — | — | — | | Target | 262,500 | | | | Nathan E. Bekke | | | | | Award | — | — | — | | Target | 300,000 | | |

  24. 2020 Long-Term Incentive Plan Awards

    2020 Long-Term Incentive Plan Awards The LTIP authorizes us to grant a mixture of restricted Common Stock ("Stock Awards"), non-qualified stock options and incentive stock options. Annual grant targets as a percentage of base salary for the NEOs other than CEO, historically range from 10% to 50%. The LTIP is designed to promote long-term ownership of the Company's Common Stock as a component of our overall compensation program, as noted above. Stock Awards for NEOs other than the CEO are recommended based on performance as evaluated by the Chairman and CEO and approved by the ECC. The Chairman's recommendation for each NEO is based on her assessment of the NEO's contribution to the financial performance of the Company in future years. Chairman and CEO grants are determined as described below. Stock Awards generally vest 100% after a three-year period. There is no partial vesting. The executive must remain an employee for three years after the grant date for the Stock Award to vest, unless otherwise approved by the ECC. Options, when granted, have a term of ten years and vest over a three-year period. After both the first and second years, 30% is vested. After the third year, the remaining 40% is vested. Ten years from the grant date, the ability to exercise any unexercised options expires. In 2024, no Stock Awards were made to NEOs under the LTIP. See “Grants of Plan-Based Awards” below.

  25. 2020 Long-Term Incentive Plan Awards For The Chairman and CEO

    2020 Long-Term Incentive Plan Awards For The Chairman and CEO Stock Awards to the Chairman and CEO have historically been made under the Company's Incentive Compensation Program. Under the Program, we establish a target Stock Award at the beginning of each year, the receipt of which is subject to adjustment based on the Chairman's and CEO's achievement of the performance measures we determine at the time of the grant. The performance measure we have used is Adjusted EBITDA in relation to Budget. We then determine the dollar value of the target Stock Award by considering the Chairman's and CEO's total compensation in relation to their peers, after taking into account their base salaries and incentive bonus opportunity, together with our assessment of the Company's operating performance in relation to peer companies, and our Company's priority objectives. In 2024, Stock Awards were made to the Executive Chairman and CEO under the Incentive Compensation Program. See "Grants of Plan-Based Awards” below. A decline in Adjusted EBITDA and revenue tied to the Company’s Three Pillar Strategy from the Budget of more than 10% would have resulted in no Stock Award being granted for the CEO. For 2024, the target Stock Award was not achieved. We have reserved the right to modify the amount of grants from year to year based on our evaluation of the Executive Chairman's and CEO's performance; to modify the performance measures from year to year; and to make discretionary equity awards in addition to, or in lieu of, awards under our Incentive Compensation Program and the LTIP.

  26. Valuation of Equity Awards

    Valuation of Equity Awards The accounting value of equity awards is charged to expense over the vesting period of the equity award. The accounting value of equity awards to NEOs is summarized below:

  27. Valuation of Equity Awards

    | (Dollars) | Total Accounting Value of 2024 Grants | Accounting Charge Recorded in 2024 for 2024 Grants | Accounting Charge Recorded in 2024 for 2023, 2022 and 2021 Grants | Accounting Charge to be Recorded in 2025-2027 for 2024 Grants | | Kevin D. Mowbray | 184,590 | 48,711 | 234,351 | 135,879 | | Timothy R. Millage | 87,900 | 23,196 | 130,561 | 64,704 | | Nathan E. Bekke | 73,783 | 19,471 | 127,770 | 54,312 |

  28. Summary Compensation Table

    Summary Compensation Table The following table summarizes the 2024 and 2023 compensation of the NEOs:

  29. Summary Compensation Table

    | (Dollars) | Year | Salary | Stock Awards (1) | Option Awards (1) | Non-Equity Incentive Plan Compensation (2) | All Other Compensation (3) (4) | Total | | Kevin D. Mowbray | 2024 | 900,000 | 184,590 | — | — | 21,671 | 1,106,261 | | President and Chief Executive Officer | 2023 | 813,462 | 268,050 | — | 213,570 | 30,369 | 1,325,451 | | Timothy R. Millage | 2024 | 525,000 | 87,900 | — | — | 12,446 | 625,346 | | Vice President, Chief Financial Officer, and Treasurer | 2023 | 474,519 | 130,000 | — | 62,291 | 15,161 | 681,971 | | Nathan E. Bekke | 2024 | 577,500 | 73,783 | — | — | 5,931 | 657,214 | | Senior Vice President - Operations and Audience Strategy | 2023 | 460,962 | 125,000 | — | 60,512 | 16,329 | 662,803 |

  30. Summary Compensation Table

    (1) Stock and option awards are granted at a price equal to the fair market value on the date of grant. Information with respect to stock awards granted to the NEOs is reflected in “Outstanding Equity Awards at September 29, 2024” below. (2) Includes discretionary amounts paid under the annual cash incentive plan. (3) Includes matching contributions made to the Company's Retirement Account Plan and Non-Qualified Plan during the year. To the extent qualifying compensation was not received during the year, such as certain non-equity incentive plan compensation, the related matching contribution may be reported in a subsequent year. (4) The Lee Foundation, an affiliate of the Company, matches on a dollar-for-dollar basis up to $5,000 annually, charitable contributions made by NEOs to qualifying organizations. Such matching contributions are not considered compensation of the NEO. The Compensation Disclosure and Analysis above more fully describes our executive compensation program and the decisions made by the ECC.

  31. Grants of Plan-Based Awards

    Grants of Plan-Based Awards The following table summarizes information related to 2024 grants of equity compensation under the LTIP and the Incentive Compensation Program for the CEO, and under the LTIP for the other NEOs.

  32. Grants of Plan-Based Awards

    | (Dollars) | 2024 Grant Date | All Other Stock Awards: Number of Shares of Stock | 2024 Grant Date Fair Value of Stock Awards | | Kevin D. Mowbray | 12/12/2023 | 21,000 | 184,590 | | Timothy R. Millage | 12/12/2023 | 10,000 | 87,900 | | Nathan E. Bekke | 12/12/2023 | 8,394 | 73,783 |

  33. Outstanding Equity Awards at September 29, 2024

    Outstanding Equity Awards at September 29, 2024 The following table summarizes outstanding equity awards to the NEOs as of September 29, 2024:

  34. Outstanding Equity Awards at September 29, 2024

    | (Dollars, Except Share Data) | Restricted Common Stock Awards | | | | Number of Shares of Stock That Have Not Vested | Market Value of Shares of Stock That Have Not Vested (1) | | Kevin D. Mowbray | | | | 2024 Stock Award | 21,000 | 184,590 | | 2023 Stock Award | 15,000 | 131,850 | | 2022 Stock Award | 13,329 | 117,162 | | Timothy R. Millage | | | | 2024 Stock Award | 10,000 | 87,900 | | 2023 Stock Award | 7,275 | 63,947 | | 2022 Stock Award | 8,331 | 73,229 | | Nathan E. Bekke | | | | 2024 Stock Award | 8,394 | 73,783 | | 2023 Stock Award | 6,995 | 61,486 | | 2022 Stock Award | 8,331 | 73,229 |

  35. Outstanding Equity Awards at September 29, 2024

    (1) Based on closing market price of $8.79 on September 27, 2024.

  36. Option Exercises and Stock Vested

    Option Exercises and Stock Vested The following table summarizes information related to vesting of restricted Common Stock of the NEOs in 2024:

  37. Option Exercises and Stock Vested

    | Restricted Common Stock | | | | (Dollars, Except Share Date) | Number of Shares Acquired on Vesting | Value Realized on Vesting | | Kevin D. Mowbray | 15,000 | 140,100 | | Timothy R. Millage | 5,000 | 46,700 | | Nathan E. Bekke | 3,556 | 33,213 |

  38. Non-Qualified Deferred Compensation

    Non-Qualified Deferred Compensation The following table summarizes information related to 2024 activity in the Non-Qualified Plan for the NEOs.

  39. Non-Qualified Deferred Compensation

    | (Dollars) | NEO Contributions | Company Contributions | Aggregate Earnings | Distributions | Aggregate Balance at September 24, 2024 | | | (1) | (2) | (3) | | (4) | | Kevin D. Mowbray | 38,615 | 15,446 | 38,240 | — | 769,057 | | Timothy R. Millage | 14,715 | 5,886 | 28,796 | — | 151,688 | | Nathan E. Bekke | — | — | 15,028 | — | 133,105 |

  40. Non-Qualified Deferred Compensation

    (1) Amounts included in total compensation in the Summary Compensation Table under “Salary.” (2) Amounts included in total compensation in the Summary Compensation Table under “All Other Compensation”. (3) Earnings are based on the performance of investments selected by the NEO. (4) Amounts include compensation to the NEO in the form of Company contributions prior to 2022. For those NEOs continuing to participate in the Non-Qualified Plan in 2020 and thereafter, withdrawals are permitted following termination of employment. Employee contributions are limited to 45% of salary and bonus compensation. See “Primary Benefits” above for additional information with regard to the Non-Qualified Plan.

  41. Potential Payments Upon Termination or Change of Control

    Potential Payments Upon Termination or Change of Control The following summarizes information as of September 29, 2024, related to estimated potential cash payments upon a change of control to the NEOs. Amounts in the table do not reflect income tax benefits that may be realized by the Company. The estimated payments also make assumptions as to whether certain discretionary bonus payments made to NEOs are qualifying annual incentive plan payments under the agreements.

  42. Potential Payments Upon Termination or Change of Control

    | (Dollars) | Estimated Net Present Value of Change of Control Severance and Benefits | | Kevin D. Mowbray | 7,624,145 | | Timothy R. Millage | 1,383,295 | | Nathan E. Bekke | 1,474,519 |

  43. CEO Pay Ratio

    CEO Pay Ratio In August 2015, pursuant to a mandate of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the SEC adopted a rule requiring annual disclosure of the ratio of the median employee’s annual total compensation to the total annual compensation of the CEO. The Company’s CEO is Mr. Mowbray. For fiscal year ended September 29, 2024, the annual total compensation for the median employee of the Company, other than our CEO, was $51,913 and the annual total compensation of our CEO was $1,106,261. Based on this information, for fiscal year 2024 the ratio of the annual total compensation of our CEO to the annual total compensation of the median employee was 21 to 1. Due to the flexibility afforded by the rules of the SEC in calculating the pay ratio amount, the ratio we calculated may not be comparable to the CEO pay ratio presented by other companies. We identified our median employee from among our employees as of September 29, 2024, the last day of our fiscal year. To identify our median employee in 2024, we used a “total cash compensation” measure consisting of: (i) fiscal year 2024 annual base pay (salary or gross wages for hourly employees including paid time off), (ii) bonuses and cash incentives paid during the year, and (iii) employer matching contributions to employee retirement plans. Certain annualizing adjustments were made for permanent full-time employees that were employed for less than one-year, such as newly hired employees and those on unpaid leave of absence during the period, pursuant to applicable SEC rules. No employees were excluded from the list, other than Mr. Mowbray. Certain components of pay, such as stock awards and other cash and non-cash fringe benefits, were excluded as they were not meaningful in determining the median employee. Compensation amounts were determined from our human resources and payroll systems of record.

  44. Pay Versus Performance

    Pay Versus Performance Under newly-adopted rules of the Securities and Exchange Commission, the following tabular disclosure is required to disclose the relationship between executive compensation registrants actually paid and the financial performance of the Company. The following tables and graphs show the relationship between the compensation actually paid to our NEOs and our financial performance.

  45. Pay Versus Performance

    | Year | Summary Compensation Table Total For CEO (1) | Compensation Actually Paid to CEO (1)(2) | Average Summary Compensation Table Total for Non-CEO NEOs(3) | Average Compensation Actually Paid to Non-CEO NEOs(2)(3) | Value of Initial Fixed $100 Investment Based on Total Shareholder Return (“TSR”) | Net Loss (Income) (4) | | 2024 | 1,106,261 | 834,597 | 641,280 | 519,354 | 37.00 | (23,573,000) | | 2023 | 1,325,451 | 778,260 | 672,387 | 401,532 | 46.30 | (2,733,000) | | 2022 | 2,331,835 | 1,547,983 | 1,084,477 | 644,257 | 71.70 | 97,000 |

  46. Pay Versus Performance

    (1) The CEO in 2024, 2023 and 2022 was Mr. Mowbray. (2) See the table immediately following these footnotes for a reconciliation of the Summary Compensation Table compensation and the Compensation Actually Paid to the CEO and Non-CEO NEO’s. (3) Non-CEO NEOs in 2024, 2023, and 2022 were Messrs. Millage and Bekke. (4) The amounts reported in this column represent net (loss) income reflected in the Company’s audited financial statements for the applicable year. The following table reconciles the Summary Compensation Table compensation to the Compensation Actually Paid in the above table.

  47. Pay Versus Performance

    | | | CEO | | | Non-CEO NEOs | | | | 2024 | 2023 | 2022 | 2024 | 2023 | 2022 | | Total Compensation as reported in the Summary Compensation Table (“SCT”) | 1,106,261 | 1,325,451 | 2,331,835 | 641,280 | 672,387 | 1,084,477 | | Deduction for Amounts Reported under the “Stock Awards” Column in the SCT | (184,590) | (268,050) | (400,000) | (80,842) | (127,500) | (250,000) | | Increase (decrease) for Fair Value of Awards Granted during year that Remain Unvested as of Year End | — | (103,200) | (173,277) | — | (49,089) | (108,303) | | Increase (decrease) for Change in Fair Value from Prior Year-end to current Year-end of Awards Granted Prior to year that were Outstanding and Unvested as of Year-end | (62,324) | (170,541) | (235,550) | (34,025) | (93,105) | (84,859) | | Increase (decrease) for Change in Fair Value from Prior-year to Vesting Date of Awards Granted Prior to year that Vested during year | (24,750) | (5,400) | 24,975 | (7,059) | (1,161) | 2,942 | | Compensation Actually Paid (“CAP”) | 834,597 | 778,260 | 1,547,983 | 519,354 | 401,532 | 644,257 |