Emmis Communications Corp. said it will make good on a previously announced employee-retention plan that will shower 598 employees with $3.24 million in company stock.
The benefit is capped at those making $50,000 a year, so those in the executive suite don’t qualify. About 75 percent of the company’s full-time employees do qualify, however.
Emplyees will receive shares based on their income. For example, an Emmis employee earning $40,000 a year would get 1,480 shares, which are worth about $5,002 based on Tuesday morning's share price of $3.38.
The incentive plan was in some doubt after preferred shareholders sued the Indianapolis-based radio and city magazine publisher in 2012, alleging they were owed $34 million in unpaid dividends.
Last month U.S. District Court Judge Sarah Evans Barker denied a motion for partial summary judgment in a lawsuit brought two years ago by Corre Opportunities Fund and other preferred shareholders.
They’ve been fighting a move by Emmis that eliminated obligations to pay preferred stock dividends that had accumulated since 2008 as part of a plan to stabilize the company’s financial condition and pare debt.
“It is no secret that the plan helped Emmis to address issues with the preferred stock,” states a note to employees from Emmis CEO Jeff Smulyan and Chief Financial Officer Patrick Walsh. “However, our board also created the plan to recognize your contributions and sacrifices since the recession, and to reward those of you who continued to stay with the company as the economy got better.”
Emmis shares are up more than 90 percent over the last year.
Among Emmis’ holdings are Indianapolis stations WIBC-FM 93.1, WLHK-FM 93.1 “Hank FM’’ and WYXB-FM 105.7.