8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 17, 2015

ENTERCOM COMMUNICATIONS CORP.

(Exact Name of Registrant as Specified in Charter)

Pennsylvania	001-14461	23-1701044
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

401 E. City Avenue, Suite 809 Bala Cynwyd, Pennsylvania	19004
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (610) 660-5610

(Former Address of Principal Executive Offices)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement

On February 19, 2015, the Board of Directors of Entercom Communications Corp. (the “Company”), upon the recommendation of the Compensation Committee of the Company’s Board of Directors, approved certain changes to the Company’s Non-Employee Director Compensation Policy (“Director Comp Policy”). The following is a summary description of the material changes to the Director Comp Policy. Reference is made to the complete text of the Director Comp Policy, which is filed as an exhibit to this current report on Form 8-K.

The revised Director Comp Policy increases the annual equity compensation from $35,000 in restricted stock to $60,000 in restricted stock. In addition, the revised Director Comp Policy increases the Committee Chair Fees as follows:

Committee Chair Fee:

• Audit Committee Chair - $15,000 per year; and

• Compensation Committee Chair - $12,500 per year.

• Nominating/Corporate Governance Chair - $5,000 per year.

Item 2.02. Results of Operations and Financial Condition

On February 19, 2015, the Company issued a press release (the “Press Release”) announcing fourth quarter and year end 2014 results. Specifically, the Company announced that for the fourth quarter of 2014:

• net revenues of $101.5 million;

• station operating expenses of $63.5 million;

• corporate general and administrative expenses of $6.5 million;

• operating income of $28.5 million; and

• net income of $10.9 million.

In addition, the Company announced that for the year ended December 31, 2014:

• net revenues of $379.8 million;

• station operating expenses of $259.2 million;

• corporate general and administrative expenses of $26.6 million;

• operating income of $85.6 million; and

• net income of $26.8 million.

A copy of the Press Release is attached as Exhibit 99.1 to this Current Report on Form 8-K. The information in Item 2.02 of this Current Report on Form 8-K and Exhibit 99.1 attached hereto, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed to be incorporated by reference in any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 8.01. Other Events

On February 17, 2015, the Company received a request for additional information and documentary material, often referred to as a “second request,” from the Department of Justice (the “DOJ”) in connection with the Company’s previously announced agreement (the “Stock Purchase Agreement”) with The Lincoln National Life Insurance Company (“Lincoln”) to acquire all of the outstanding shares of capital stock of Lincoln Financial Media Company from Lincoln (the “Transaction”). The second request was issued under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”). Consummation of the Transaction is conditioned on expiration of the waiting period applicable under the HSR Act.

Issuance of the second request extends the waiting period under the HSR Act until 30 days after both parties to the Stock Purchase Agreement have substantially complied with the second request, unless the waiting period is terminated earlier by the DOJ or the parties voluntarily extend the time for closing. The second request, however, may delay the consummation of the Transaction beyond the second quarter of 2015, as originally disclosed by the Company.

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Forward-Looking Statements

This Form 8-K and other reports filed by the Company from time to time with the Securities and Exchange Commission (collectively, “Filings”) contain or may contain forward looking statements and information that are based upon beliefs of, and information currently available to, our management as well as estimates and assumptions made by our management. When used in the Filings the words “anticipate”, “believe”, “estimate”, “expect”, “future”, “intend”, “plan” or the negative of these terms and similar expressions identify forward looking statements as they relate to our business or our management. Such statements reflect management’s current view of our business with respect to future events and are subject to risks, uncertainties, assumptions and other factors (including the risks contained in the section of our Annual Report filed on Form 10-K entitled “Risk Factors”) relating to our industry, operations and results of operations, and other relevant aspects of our business. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended or planned.

Although we believe the expectations reflected in the forward looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements contained within this Form 8-K and elsewhere.

Item 9.01. Exhibits

(d) Exhibits

Exhibit No.	Title
10.01	Entercom Non-Employee Director Compensation Policy.
99.1	Entercom Communications Corp.’s Press Release, issued February 19, 2015.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Entercom Communications Corp.
By:	/s/ Stephen F. Fisher
	Stephen F. Fisher
	Executive Vice President and Chief Financial Officer

Dated: February 19, 2015

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EXHIBIT INDEX

Exhibit No.	Title
10.01	Entercom Non-Employee Director Compensation Policy.
99.1	Entercom Communications Corp.’s Press Release, issued February 19, 2015.

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EX-10.01

Exhibit 10.01

Entercom Communications Corp.

Non-employee Director Compensation Policy

Cash Compensation:

Annual Board Retainer: $40,000 per year.

Committee Membership Fee:

• Audit Committee - $7,500 per year

• Compensation Committee - $2,500 per year; and

• Nominating/Corporate Governance Committee - $2,500 per year.

Committee Chair Fee:

• Audit Committee Chair - $15,000 per year; and

• Compensation Committee Chair - $12,500 per year.

• Nominating/Corporate Governance Chair - $5,000 per year.

Payment: The Board Retainer, Committee Membership Fees and Committee Chair Fees shall be paid in equal quarterly installments on May 31, August 31, November 30 and February 28 following election to the board, committee or chair position, as applicable; provided that each non-employee director shall have the option, on or before their date of election, to choose to receive restricted stock of the Company in lieu of such cash payments. Any such choice to receive restricted stock in lieu of cash will be granted on the date of election to the board, committee or chair position and the number of shares will be computed based on the closing price of the Company’s stock at the end of the last trading day immediately preceding such election. Such shares will vest on the day prior to next the annual meeting of shareholders. For partial year service the applicable fee(s) will be prorated based upon the days of service.

Equity Compensation: An annual grant of $60,000 in shares of restricted stock shall be granted at the time of annual grants to employees of the Company in the form previously approved by the Compensation Committee and shall vest over four years. The number of shares will be computed based on the closing price of the Company’s stock at the end of the last trading day immediately preceding the grant date.

EX-99.1

Exhibit 99.1

Entercom Communications Corp.

Reports Fourth Quarter and Full Year Results

Fourth Quarter Revenue Increased 2%

(Bala Cynwyd, Pa. February 19, 2015) Entercom Communications Corp. (NYSE: ETM) today reported financial results for the quarter ended December 31, 2014.

Fourth Quarter Highlights

• Net revenues for the quarter increased 2% to $101.5 million

• Station expenses increased 3% to $63.3 million

• Station operating income was flat at $38.2 million

• Adjusted EBITDA increased 1% to $33.0 million

• Adjusted net income per share increased 3% to $0.32

• Free cash flow increased 4% to $23.4 million

Full Year Highlights

• Net revenues for the year increased 1% to $379.8 million

• Station expenses increased 3% to $258.3 million

• Station operating income decreased 3% to $121.5 million

• Adjusted EBITDA decreased 5% to $99.3 million

• Adjusted net income per share was flat at $0.79

• Free cash flow decreased 7% to $56.1 million

David J. Field, President and Chief Executive Officer, stated: “After finishing 2014 with modest gains in net revenues, adjusted net income and free cash flow, Entercom is looking forward to a promising year of opportunity in 2015. Our recently announced Lincoln Financial Media acquisition will add a number of terrific new markets and brands to our lineup and should be accretive to shareholders with no material impact on our solid balance sheet. And we are well-positioned to capitalize on a number of other significant growth opportunities throughout the organization.”

Additional Information

In December the Company announced the acquisition of Lincoln Financial Media from Lincoln Financial Group for $105 million plus working capital. The transaction adds 15 stations in four markets: Atlanta, Denver, Miami and San Diego. The $105 million purchase price will be paid in the form of $77.5 million in cash and $27.5 million in new perpetual cumulative convertible

Exhibit 99.1 - Page 1

preferred stock that will be issued to Lincoln. In order to comply with the FCC’s station ownership limitations, the Company plans to divest one FM station in the Denver market.

The Company reduced its outstanding debt by $17.4 million (net of cash) during the quarter. As of December 31, 2014 the Company had $479.9 million of senior debt and senior notes and $31.5 million in cash.

Earnings Conference Call and Company Information

Entercom will hold a conference call regarding the quarterly earnings release on Thursday, February 19, 2015 at 4:30 PM Eastern Time. Investors will have the opportunity to submit questions to the Company regarding the fourth quarter earnings release by emailing their inquiries to questions@entercom.com. Questions should be sent at least 10 minutes prior to the call. The Company will only discuss inquiries made by email prior to the conference call. The public may access the conference call by dialing 888-889-0278 (passcode: Entercom). A replay of the conference call will be available and can be accessed either by dialing 866-491-2943 or by visiting the Company’s website: www.entercom.com. Additional information and reconciliation of same station results are available on the Company’s website at www.entercom.com.

About Entercom

Entercom Communications Corp. (NYSE: ETM) is the fourth-largest radio broadcasting company in the United States with a portfolio that, including the announced acquisition of Lincoln Financial Media, boasts over 125 highly-rated radio stations in 26 top markets across the country. Known for developing unique and highly successful locally programmed stations, Entercom’s brands reach and engage close to 40 million people each week, delivering a curated mix of outstanding local personalities and a broad range of compelling music, news, talk and sports content.

Founded in 1968, Philadelphia-based Entercom also operates hundreds of events each year, attracting millions of attendees, and runs a full-service digital marketing division, SmartReach Digital, providing customers with a broad range of digital marketing solutions.

More information is available at www.Entercom.com, Facebook, and Twitter (@entercom).

Certain Definitions

All references to per share data, unless stated otherwise, are presented as per diluted share. All references to shares outstanding, unless stated otherwise, are presented to exclude unvested restricted stock units. All references to net debt are outstanding debt net of cash on hand.

Station expenses consist of station operating expenses excluding non-cash compensation expense.

Corporate expenses consist of corporate general and administrative expenses excluding non-cash compensation expense.

Exhibit 99.1 - Page 2

Station operating income consists of operating income (loss) before: depreciation and amortization; time brokerage agreement fees (income); corporate general and administrative expenses; non-cash compensation expense (which is otherwise included in station operating expenses); impairment loss; merger and acquisition costs; and gain or loss on sale or disposition of assets.

Adjusted EBITDA consists of net income (loss), adjusted to exclude: income taxes (benefit); total other expense; depreciation and amortization; time brokerage agreement fees (income); non-cash compensation expense (which is otherwise included in station operating expenses and corporate G&A expenses); impairment loss; merger and acquisition costs; and gain or loss on sale or disposition of assets.

Free cash flow consists of operating income (loss): (i) plus depreciation and amortization, net (gain) loss on sale or disposal of assets; non-cash compensation expense (which is otherwise included in station operating expenses and corporate general and administrative expenses), impairment loss; merger and acquisition costs; and (ii) less net interest expense (excluding amortization of deferred financing costs), taxes paid and capital expenditures.

Adjusted net income consists of net income (loss) adjusted to exclude: (i) income taxes (benefit) as reported; (ii) gain/loss on sale of assets, derivative instruments and investments; (iii) non-cash compensation expense; (iv) other income; (v) impairment loss; (vi) merger and acquisition costs; and (vii) gain/loss on early extinguishment of debt. For purposes of comparability, income taxes are reflected at the expected statutory federal and state income tax rate of 42% without discrete items of tax.

Adjusted net income per share includes any dilutive equivalent shares when not anti-dilutive.

Same station is computed by comparing the performance of stations operated by the Company throughout the relevant period to the comparable performance in the prior year’s corresponding period (excluding non-cash compensation expense). Any acquisition or disposition of radio stations not deemed to be material by management are ignored for the purpose of computing this data. There were no material acquisitions during the periods presented in the tables below.

Non-GAAP Financial Measures

It is important to note that station operating income, station expense, corporate expense, same station net revenues, same station expenses, same station operating income, adjusted EBITDA, adjusted net income, adjusted net income per share and free cash flow are not measures of performance or liquidity calculated in accordance with generally accepted accounting principles (“GAAP”). Management believes that these measures are useful as a way to evaluate the Company and the means for management to evaluate our radio stations’ performance and operations. Management believes that these measures are useful to an investor in evaluating our performance because they are widely used in the broadcast industry as a measure of a radio company’s operating performance.

Exhibit 99.1 - Page 3

Certain adjusted non-GAAP financial measures are presented in this release (e.g., adjusted net income and adjusted net income per share). The adjustments exclude gain/loss on sale of assets, derivative instruments, and investments; non-cash compensation expense, other income, impairment loss and gain/loss on early extinguishment of debt. Management believes these adjusted non-GAAP measures provide useful information to Management and investors by excluding certain income, expenses and gains and losses that may not be indicative of the Company’s core operating and financial results. Similarly, Management believes these adjusted measures are a useful performance measure because certain items included in the calculation of net income (loss) may either mask or exaggerate trends in the Company’s ongoing operating performance. Further, the reconciliations corresponding to these adjusted measures, by identifying the individual adjustments, provide a useful mechanism for investors to consider these adjusted measures with some or all of the identified adjustments.

Management uses these non-GAAP financial measures on an ongoing basis to help track and assess the Company’s financial performance. You, however, should not consider non-GAAP measures in isolation or as substitutes for net income (loss), operating income, or any other measure for determining our operating performance that is calculated in accordance with generally accepted accounting principles. These non-GAAP measures are not necessarily comparable to similarly titled measures employed by other companies. The accompanying financial tables provide reconciliations to the nearest GAAP measure of all non-GAAP measures provided in this release.

Note Regarding Forward-Looking Statements

The information in this news release is being widely disseminated in accordance with the Securities and Exchange Commission’s Regulation FD.

This news announcement contains certain forward-looking statements that are based upon current expectations and certain unaudited pro forma information that is presented for illustrative purposes only and involves certain risks and uncertainties within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Additional information and key risks are described in the Company’s filings on Forms 8-K, 10-Q and 10-K with the Securities and Exchange Commission. Readers should note that these statements might be impacted by several factors including changes in the economic and regulatory climate and the business of radio broadcasting, in general. The unaudited pro forma information and same station operating data reflect adjustments and are presented for comparative purposes only and do not purport to be indicative of what has occurred or indicative of future operating results or financial position. Accordingly, the Company’s actual performance may differ materially from those stated or implied herein. The Company assumes no obligation to publicly update or revise any unaudited pro forma or forward-looking statements.

Contact:

Steve Fisher

Executive Vice President and Chief Financial Officer

610-660-5647

Exhibit 99.1 - Page 4

Fourth Quarter 2014

Earnings Release

ENTERCOM COMMUNICATIONS CORP.

FINANCIAL DATA

(amounts in thousands, except per share data)

(unaudited)

	Three Months Ended December 31,						Year Ended December 31,
	2014			2013			2014			2013
STATEMENTS OF OPERATIONS
Net Revenues	$	101,513		$	99,583		$	379,789		$	377,618
Station Expenses		63,265			61,312			258,265			251,830
Station Expense - Non-Cash Compensation		247			244			919			766
Corporate Expenses		5,244			5,448			22,259			20,877
Corporate Expenses - Non-Cash Compensation		1,234			1,046			4,313			3,504
Depreciation And Amortization		1,997			1,988			7,794			8,545
Impairment Loss		—			—			—			850
Merger and acquisition costs		1,042			—			1,042			—
Net (Gain) Loss On Sale Or Disposition of Assets		(47	)		304			(379	)		(1,321	)
Total Operating Expenses		72,982			70,342			294,213			285,051
Operating Income		28,531			29,241			85,576			92,567
Other Expense (Income) Items:
Net Interest Expense		9,354			10,410			38,821			44,232
Net Loss On Investments		21			—			21			—
Other Income		—			(72	)		—			(165	)
Total Other Expense		9,375			10,338			38,842			44,067
Income Before Income Taxes		19,156			18,903			46,734			48,500
Income Taxes		8,306			9,396			19,911			22,476
Net Income	$	10,850		$	9,507		$	26,823		$	26,024
Net Income Per Share - Basic	$	0.29		$	0.25		$	0.71		$	0.70
Net Income Per Share - Diluted	$	0.28		$	0.25		$	0.69		$	0.68
Weighted Common Shares Outstanding - Basic		37,779			37,471			37,763			37,418
Weighted Common Shares Outstanding - Diluted		38,730			38,336			38,664			38,301
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Capital Expenditures	$	1,018		$	823		$	8,408		$	4,325
Income Taxes Paid	$	—		$	—		$	79		$	69
Cash Interest	$	14,595		$	14,632		$	35,593		$	41,010
	December 31,
	2014			2013
SELECTED BALANCE SHEET DATA
Cash	$	31,540		$	12,231
Total Assets	$	926,615		$	912,688
Current Portion Of Senior Debt	$	3,000		$	3,000
Senior Debt (including Current Debt)	$	262,000		$	299,500
Senior Notes	$	217,929		$	217,624
Total Shareholders’ Equity	$	329,021		$	298,393

Exhibit 99.1 - Page 5

OTHER FINANCIAL DATA

	Three Months Ended December 31,						Year Ended December 31,
	2014			2013			2014			2013
Reconciliation Of GAAP Station Operating Expenses To Station Expenses
Station Operating Expenses	$	63,512		$	61,556		$	259,184		$	252,596
Station Expenses - Non-Cash Compensation		(247	)		(244	)		(919	)		(766	)
Station Expenses	$	63,265		$	61,312		$	258,265		$	251,830
Reconciliation Of GAAP Corporate General & Administrative Expenses To Corporate Expenses
Corporate General & Administrative Expenses	$	6,478		$	6,494		$	26,572		$	24,381
Corporate Expenses - Non-Cash Compensation		(1,234	)		(1,046	)		(4,313	)		(3,504	)
Corporate Expenses	$	5,244		$	5,448		$	22,259		$	20,877
Reconciliation Of GAAP Operating Income To Station Operating Income
Operating Income	$	28,531		$	29,241		$	85,576		$	92,567
Corporate Expenses		5,244			5,448			22,259			20,877
Corporate Expenses - Non-Cash Compensation		1,234			1,046			4,313			3,504
Station Expenses - Non-Cash Compensation		247			244			919			766
Depreciation And Amortization		1,997			1,988			7,794			8,545
Impairment Loss		—			—			—			850
Merger and acquisition costs		1,042			—			1,042			—
Net (Gain) Loss On Sale Or Disposition of Assets		(47	)		304			(379	)		(1,321	)
Station Operating Income	$	38,248		$	38,271		$	121,524		$	125,788
Reconciliation Of GAAP Net Income To Adjusted EBITDA
Net Income	$	10,850		$	9,507		$	26,823		$	26,024
Income Taxes		8,306			9,396			19,911			22,476
Total Other Expense		9,375			10,338			38,842			44,067
Corporate Expenses - Non-Cash Compensation		1,234			1,046			4,313			3,504
Station Expenses - Non-Cash Compensation		247			244			919			766
Depreciation And Amortization		1,997			1,988			7,794			8,545
Impairment Loss		—			—			—			850
Merger and acquisition costs		1,042			—			1,042			—
Net (Gain) Loss On Sale Or Disposition of Assets		(47	)		304			(379	)		(1,321	)
Adjusted EBITDA	$	33,004		$	32,823		$	99,265		$	104,911
Reconciliation Of GAAP Net Income To Free Cash Flow
Net Income	$	10,850		$	9,507		$	26,823		$	26,024
Depreciation And Amortization		1,997			1,988			7,794			8,545
Impairment Loss		—			—			—			850
Merger and acquisition costs		1,042			—			1,042			—
Deferred Financing Costs Included In Interest Expense		695			812			3,860			3,870
Amortization Of Original Issue Discount Included In Interest Expense		79			71			305			274
Non-Cash Compensation Expense		1,481			1,290			5,232			4,270
Net (Gain) Loss On Sale Or Disposition of Assets		(47	)		304			(379	)		(1,321	)
Net Loss On Investments		21			—			21			—
Other Income		—			(72	)		—			(165	)
Income Taxes		8,306			9,396			19,911			22,476
Capital Expenditures		(1,018	)		(823	)		(8,408	)		(4,325	)
Income Taxes Paid		—			—			(79	)		(69	)
Free Cash Flow	$	23,406		$	22,473		$	56,122		$	60,429

Exhibit 99.1 - Page 6

	Three Months Ended December 31,						Year Ended December 31,
	2014			2013			2014			2013
Reconciliation Of GAAP Operating Income To Free Cash Flow:
Operating Income	$	28,531		$	29,241		$	85,576		$	92,567
Depreciation and Amortization		1,997			1,988			7,794			8,545
Non-Cash Compensation Expense		1,481			1,290			5,232			4,270
Impairment Loss		—			—			—			850
Interest Expense, Net of Interest Income, Deferred Financing Costs & OID		(8,580	)		(9,527	)		(34,656	)		(40,088	)
Capital Expenditures		(1,018	)		(823	)		(8,408	)		(4,325	)
Merger and acquisition costs		1,042			—			1,042			—
Net (Gain) Loss On Sale Or Disposition of Assets		(47	)		304			(379	)		(1,321	)
Income Taxes Paid		—			—			(79	)		(69	)
Free Cash Flow	$	23,406		$	22,473		$	56,122		$	60,429
Reconciliation Of GAAP Net Income To Adjusted Net Income
Net Income	$	10,850		$	9,507		$	26,823		$	26,024
Income Taxes		8,306			9,396			19,911			22,476
Net (Gain) Loss On Sale Or Disposition of Assets		(47	)		304			(379	)		(1,321	)
Impairment Loss		—			—			—			850
Net Loss On Investments		21			—			21			—
Other Income		—			(72	)		—			(165	)
Merger and acquisition costs		1,042			—			1,042			—
Non-Cash Compensation Expense		1,481			1,290			5,232			4,270
Adjusted Income Before Income Taxes		21,653			20,425			52,650			52,134
Income Taxes		9,094			8,579			22,113			21,896
Adjusted Net Income	$	12,559		$	11,847		$	30,537		$	30,238
Weighted Average Diluted Shares Outstanding		38,730			38,336			38,664			38,301
Adjusted Net Income Per Share - Diluted	$	0.32		$	0.31		$	0.79		$	0.79

Exhibit 99.1 - Page 7