GUARANTOR ARRANGEMENTS (Block)

12 Months Ended

Dec. 31, 2016

Disclosure Text Block Supplement Abstract

Commitments Contingencies And Guarantees Text Block

21. GUARANTOR ARRANGEMENTS

Guarantor Arrangements

The Company recognizes, at the inception of a guarantee, a liability for the fair value of the obligation undertaken by issuing the guarantee. The following is a summary of agreements that the Company has determined are within the scope of guarantor arrangements:

The Company enters into indemnification agreements in the ordinary course of business. Under these agreements, the Company typically indemnifies, holds harmless, and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. The Company believes that the estimated fair value of these agreements is minimal. Accordingly, the Company has not recorded liabilities for these agreements as of December 31, 2016.
Under the Company’s Credit Facility, the Company is required to reimburse lenders for any increased costs that they may incur in the event of a change in law, rule or regulation resulting in their reduced returns from any change in capital requirements. The Company cannot estimate the potential amount of any future payment under this provision, nor can the Company predict if such an event will ever occur.
In connection with many of the Company’s acquisitions, the Company enters into a TBA or local marketing agreements for specified periods of time, usually six months or less, whereby the Company typically indemnifies the owner and operator of the radio station, their employees, agents and contractors from liability, claims and damages arising from the activities of operating the radio station under such agreements. The maximum potential amount of any future payments the Company could be required to make for any such previous indemnification obligations is indeterminable at this time. The Company has not, however, previously incurred any significant costs to defend lawsuits or settle claims relating to any such indemnification obligation.

Financial Statements Of Parent

The condensed financial data of the Parent Company has been prepared in accordance with Rule 12-04 of Regulation S-X. The Parent Company’s financial data includes the financial data of Entercom Communications Corp., excluding all subsidiaries.

The most significant restrictions on the payment of dividends by Radio (as contemplated by Rule 4-08(e) of Regulation S-X) are set forth in the Credit Facility.

Under the Credit Facility, Radio is permitted to make distributions to the Parent Company in amounts, as defined, as follows: (a) amounts which are required to pay the Parent Company’s reasonable overhead costs, including income taxes and other costs associated with conducting the operations of Radio and its subsidiaries; and (b) certain amounts which qualify as “Restricted Payments.” With respect to the Credit Facility, the permitted Restricted Payment is generally $60 million plus Cumulative Retained Excess Cash Flow. The Company’s ability to make a Restricted Payment in these amounts under the Credit Facility is a function of its leverage ratio.

Effectively all of Radio’s assets are subject to these distribution limitations to the Parent Company.

The following tables set forth the condensed financial data (other than the statements of shareholders’ equity as this statement is not condensed) of the Parent Company:

the balance sheets as of December 31, 2016 and 2015;
the statements of operations for the years ended December 31, 2016, 2015 and 2014;
the statements of shareholders’ equity for the years ended December 31, 2016, 2015 and 2014; and
the statements of cash flows for the years ended December 31, 2016, 2015 and 2014.

ENTERCOM COMMUNICATIONS CORP.
CONDENSED PARENT COMPANY BALANCE SHEETS
(amounts in thousands)

	2016		2015
ASSETS

Current Assets	$	7,228	$	7,289
Property And Equipment - Net		2,866		472
Deferred Charges And
Other Assets - Net		1,813		3,807
Investment In Subsidiaries / Intercompany		456,161		424,493
TOTAL ASSETS	$	468,068	$	436,061

LIABILITIES AND
SHAREHOLDERS' EQUITY
Current Liabilities	$	20,042	$	19,631
Long Term Liabilities		26,920		27,361
Total Liabilities		46,962		46,992
Perpetual Cumulative Convertible Preferred Stock		27,732		27,619
Shareholders' Equity:
Class A, B and C Common Stock		407		397
Additional Paid-In Capital		605,603		611,754
Accumulated Deficit		(212,636)		(250,701)
Total shareholders' equity		393,374		361,450
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY	$	468,068	$	436,061

See notes to condensed Parent Company financial statements.

ENTERCOM COMMUNICATIONS CORP.
CONDENSED PARENT COMPANY INCOME STATEMENTS
(amounts in thousands)

	YEARS ENDED DECEMBER 31,
	2016		2015		2014

NET REVENUES	$	2,131	$	1,536	$	1,309

OPERATING (INCOME) EXPENSE:
Depreciation and amortization expense		1,235		1,123		1,217
Corporate general and administrative expenses		33,218		26,395		26,463
Merger and acquisition costs and restructuring charges		708		6,836		1,042
Other expenses related to financing		565		-		-
Net (gain) loss on sale or disposal of assets		(601)		(601)		(601)
Total operating expense		35,125		33,753		28,121
OPERATING INCOME (LOSS)		(32,994)		(32,217)		(26,812)

Net interest expense, including amortization
of deferred financing expense		24		-		15
Net recovery of a claim		100		-		-
Income from equity investment in subsidiaries		(85,977)		(79,838)		(73,561)
TOTAL OTHER (INCOME) EXPENSE		(85,853)		(79,838)		(73,546)

INCOME (LOSS) BEFORE INCOME TAXES (BENEFIT)		52,859		47,621		46,734

INCOME TAXES (BENEFIT)		14,794		18,437		19,911
NET INCOME (LOSS) AVAILABLE TO THE COMPANY		38,065		29,184		26,823
Preferred stock dividend		(1,901)		(752)		-
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	36,164	$	28,432	$	26,823

See notes to condensed Parent Company financial statements.

ENTERCOM COMMUNICATIONS CORP.
PARENT COMPANY STATEMENTS OF SHAREHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 2016, 2015 AND 2014
(amounts in thousands, except share data)

									Retained
	Common Stock						Additional		Earnings
	Class A			Class B			Paid-in		(Accumulated
	Shares	Amount		Shares	Amount		Capital		Deficit)		Total
Balance, December 31, 2013	31,308,194	$	313	7,197,532	$	72	$	604,721	$	(306,713)	$	298,393
Net income (loss) available to the Company	-		-	-		-		-		26,823		26,823
Compensation expense related to granting
of stock awards	638,102		7	-		-		5,225		-		5,232
Exercise of stock options	57,500		-	-		-		82		-		82
Purchase of vested employee restricted
stock units	(141,502)		(1)	-		-		(1,513)		-		(1,514)
Forfeitures of dividend equivalents	-		-	-		-		-		5		5
Balance, December 31, 2014	31,862,294		319	7,197,532		72		608,515		(279,885)		329,021
Net income (loss) available to the Company	-		-	-		-		-		29,184		29,184
Compensation expense related to granting
of stock awards	738,195		7	-		-		5,517		-		5,524
Exercise of stock options	11,750		-	-		-		35		-		35
Purchase of vested employee restricted
stock units	(131,688)		(1)	-		-		(1,561)		-		(1,562)
Preferred stock dividend	-		-	-		-		(752)		-		(752)
Balance, December 31, 2015	32,480,551		325	7,197,532		72		611,754		(250,701)		361,450
Net income (loss) available to the Company	-		-	-		-		-		38,065		38,065
Compensation expense related to granting
of stock awards	1,095,759		11	-		-		6,528		-		6,539
Issuance of common stock related to the Employee
Share Purchase Plan ("ESPP")	31,933		-	-		-		379		-		379
Exercise of stock options	134,238		1	-		-		264		-		265
Purchase of vested employee restricted
stock units	(232,297)		(2)	-		-		(2,266)		-		(2,268)
Payment of dividends on common stock	-		-	-		-		(8,666)		-		(8,666)
Dividend equivalents, net of forfeitures	-		-	-		-		(602)		-		(602)
Payment of dividends on preferred stock	-		-	-		-		(1,788)		-		(1,788)
Balance, December 31, 2016	33,510,184	$	335	7,197,532	$	72	$	605,603	$	(212,636)	$	393,374

See notes to Parent Company financial statements.

ENTERCOM COMMUNICATIONS CORP.
CONDENSED PARENT COMPANY STATEMENTS OF CASH FLOWS
(amounts in thousands)

	YEARS ENDED DECEMBER 31,
	2016		2015		2014

OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	(24,344)	$	(25,355)	$	(21,652)

INVESTING ACTIVITIES:
Additions to property and equipment		(1,849)		(304)		(213)
Additions to intangible assets		(182)		(1,142)		(481)
Proceeds (distributions) from investments in subsidiaries		44,527		29,030		23,610
Net cash provided by (used in) investing activities		42,496		27,584		22,916

FINANCING ACTIVITIES:
Proceeds from issuance of employee stock plan		379		-		-
Payment of fees associated with the issuance of preferred stock		-		(220)		-
Payment of call premium and other fees		(5,977)		-		-
Proceeds from the exercise of stock options		265		35		82
Purchase of vested employee restricted stock units		(2,268)		(1,562)		(1,514)
Payment of dividends on common stock		(8,666)		-		-
Payment of dividend equivalents on vested restricted stock units		(94)		(7)		-
Net cash provided by (used in) financing activities		(18,149)		(2,167)		(1,432)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		3		62		(168)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR		195		133		301
CASH AND CASH EQUIVALENTS, END OF YEAR	$	198	$	195	$	133

See notes to condensed Parent Company financial statements.

Accounting Policies

The Parent Company follows the accounting policies as described in Note 2 except that the Parent Company accounts for its investment in its subsidiaries using the equity method.

Debt – For a discussion of debt obligations of the Company, refer to Note 8.

Other - For further information, reference should be made to the notes to the consolidated financial statements of the Company.