Kevin Mowbray

About Kevin Mowbray

Kevin D. Mowbray, age 63, has served as President & Chief Executive Officer of Lee Enterprises since February 2016 and as a director since 2016; he joined Lee in 1986 and previously held senior operating roles, including Publisher of the St. Louis Post-Dispatch and Chief Operating Officer . Under his leadership in fiscal 2024, Lee grew total Digital Revenue 9.4% to $299.1M (48.9% of total), while company-wide revenue was $611.4M, Adjusted EBITDA was $65.3M, and net loss was $23.6M . Pay-versus-performance disclosures show a three-year decline in total shareholder return (TSR) from 71.7 to 37.0 on a $100 basis from 2022 to 2024, alongside net losses in 2023–2024 .

Past Roles

External Roles

Fixed Compensation

Notes:

• 2024 annual incentive target amount shown in plan table was $900,000; no award was paid for 2024 .

Performance Compensation

Annual Cash Incentive (Short-Term Incentive, STI)

Additional details:

• For 2024, CEO eligible “from 0% up to 100% of the financial bonus target,” with payouts tied to Adjusted EBITDA and revenue tied to the Company’s Three Pillar Strategy; 2024 paid 0% .
• CEO’s 2024 annual incentive plan shows a $900,000 target; award was not earned .

Long-Term Incentive (Equity)

• Program redesign in 2025 proxy: mix of 50% performance-based PSUs, 25% time-based RS, and up to 25% options; PSUs have a 3-year performance period; options vest over three years; RS generally vest 1/3 annually .
• Clawback policy applies to awards under the LTIP .
• No repricing; no evergreen; no option cash buyouts; no excise tax gross-ups in the LTIP .

Key CEO grants and vesting

Outstanding unvested restricted stock (as of 9/29/2024): 49,329 shares (21,000 2024 + 15,000 2023 + 13,329 2022) .

Accounting charges and forward expense recognition (awareness)

Equity Ownership & Alignment

Additional alignment details:

• Unvested restricted shares: 49,329 as of 9/29/2024 (see table above) .
• No stock options reported outstanding for CEO in 2023–2024 disclosures .
• Company prohibits directors and officers from hedging, holding in margin accounts, or pledging Company securities (mitigates alignment risk) .
• Director stock ownership guidelines exist; employee directors receive no additional director compensation; executive ownership guidelines not explicitly disclosed in 2025 proxy .

Employment Terms

• Change-of-control (CIC) agreements (auto-renewed annually; 2-year protection period post-CIC): CEO severance equals 3x annual base salary plus highest recent annual bonus; VPs: 1x (salary + highest recent bonus) .
• Equity uses “double trigger” — accelerated vesting or payout upon CIC only if awards aren’t assumed or if assumed and the executive is terminated without cause or resigns for good reason within the protection period .
• Excise tax “cutback” to avoid 280G penalties if it results in higher after-tax proceeds (no gross-up) .
• One-year post-CIC restrictions on competition, customer solicitation, and employee solicitation; confidentiality obligations also apply .
• Estimated net present value of CEO CIC severance and benefits (as of 9/29/2024): $7,624,145 .

Board Governance (Director role, committees, independence)

• Board service: Director since 2016; not independent (as an employee) .
• Committee membership: None (all three standing committees—Audit & Risk, Executive Compensation, Nominating & Corporate Governance—are fully independent) .
• Governance structure separates Chairman (Mary E. Junck) and CEO; independent Lead Director (Herbert W. Moloney III) presides over executive sessions and independent director activities .
• Board met 9 times in 2024; no incumbent director attended fewer than 75% of meetings .
• Employees receive no additional compensation for serving as directors .

Director Compensation (for completeness re: dual role)

• Employee directors (e.g., CEO) do not receive director fees or equity under the non-employee director program .
• Non-employee director program includes cash retainers and annual restricted stock; independent director stock ownership guidelines are in place .

Compensation Structure Analysis (alignment and trend signals)

• 2024: No annual bonus paid to CEO; emphasis shifts toward equity with multi-year vesting, improving alignment with long-term outcomes .
• Response to investor feedback (65.8% say-on-pay approval in 2024): Introduced performance-based equity (PSUs 50%) and clearer disclosure; amended LTIP to add capacity and align with best practices .
• Risk controls: Clawback policy; prohibition on hedging/pledging; no repricing; double-trigger CIC equity; excise tax cutback (no gross-up) .

Compensation Peer Group and Targeting

• Peer group used for benchmarking: Gannett, TownSquare Media, E.W. Scripps, Tegna, The New York Times, Sinclair Broadcast Group .
• Target pay positioning: median of market to establish total compensation opportunity, with internal equity considered .

Performance & Track Record

Operational highlights for 2024:

• Total operating revenue $611.4M (-11.5% y/y); Digital Revenue $299.1M (+9.4% y/y); digital-only subscription revenue +38.9% y/y .
• Adjusted EBITDA $65.3M; Cash Costs down 10.1%; Amplified Digital revenue $99M (+8.5% y/y); BLOX Digital revenue $38.6M (+10.4% y/y, standalone) .

Say-on-Pay & Shareholder Feedback

• 2024 say-on-pay support: 65.8% approval; company engaged investors (~30% of shares) and restructured LTIP to 50% PSUs / 25% RS / up to 25% options; enhanced CD&A disclosures; ongoing board refresh .

Equity Supply and Overhang (2025 LTIP amendment context)

• Shareholders asked to approve +500,000 LTIP shares (to 865,946 total); would raise overhang to ~14% from 5.9% as of 12/31/2024; expected burn rate ~1.36% in 2025 (3-year avg 2022–2024) .

Employment & Contracts Summary

• CEO since Feb 2016; at Lee since 1986 .
• CIC agreement: double-trigger equity; 3x salary+highest recent bonus; 2-year protected period; one-year non-compete/non-solicit .
• Estimated CIC package NPV: $7.6M (as of 9/29/2024) .

External Roles (potential information flow)

• Director at News Media Alliance (Exec Committee); Chair of API; Director at Associated Press—broad industry exposure and information flow .

Investment Implications

• Alignment improving: Shift to 50% PSUs and clawback policy, plus prohibitions on hedging/pledging, should enhance pay-for-performance alignment; three-year cliff or 1/3 vesting schedules create defined vesting dates that can drive periodic insider selling for tax/net settlement (monitor Form 4s near vesting anniversaries) .
• Retention risk appears contained: Multi-year unvested equity (49,329 shares as of 9/29/2024), sizeable CIC protections (3x salary+bonus), and long tenure reduce near-term flight risk, though say-on-pay softness (65.8%) suggests investors will scrutinize goal rigor and PSU calibration .
• Ownership alignment is meaningful for a micro-cap: CEO beneficial ownership of 2.3% (Oct-2025) suggests skin-in-the-game; no pledging mitigates governance red flags .
• Performance overhang: TSR has trended down over 2022–2024; 2024 net loss and no annual bonus to CEO reflect underperformance vs budget—investors should focus on execution of digital growth pillars and PSU target calibration for value creation .

Note: Recent Form 4 transaction patterns for Kevin Mowbray were not retrieved in this review; consider monitoring insider filings around December–January (grant and vest dates) to assess net share settlements/selling pressure.