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) April 11, 2005

INTEREP NATIONAL RADIO SALES, INC.

(Exact Name of Registrant as Specified in Charter)

New York	000-28395	13-1865151
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

100 Park Avenue, New York, New York	10017
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (212) 916-0700

(Former name or former address, if changed since last report.)

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:

¨ 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 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review

(a) On April 11, 2005, after discussions among the Audit Committee of the Board of Directors of Interep National Radio Sales, Inc. (the “Company”), management, BDO Seidman LLP, the Company’s current independent auditors, and Ernst & Young LLP, the Company’s former independent auditors, the Company determined that certain of its financial statements should no longer be relied on for the reasons described below:

(1) The Company has determined that it should apply the principles of Emerging Issues Task Force (“EITF”) No. 03-16, Accounting for Investments in Limited Liability Companies, to its investment in a limited liability company. Because of this change in accounting principle regarding limited liability company investments, the Company is accounting for its investment in such limited liability company on the equity method of accounting rather than the cost method of accounting, with a resulting $561,000 net reduction in the carrying amount of the Company’s investment in such limited liability company. Since EITF No. 03-16 became effective for fiscal quarters beginning after June 15, 2004, this change in accounting principle should have been reflected in the Company’s financial statements for the quarter ended September 30, 2004. Accordingly, the Company is restating such financial statements, which restatements are set forth in Exhibit 99.1 to this current report.

(2) In accordance with EITF No. 00-27, Application of Issue No. 98-5 to Certain Convertible Instruments, the Company has determined that the beneficial conversion feature of the Company’s Series A Preferred Stock should have been recorded in the year of issuance of such preferred stock as a deemed dividend to its preferred shareholders. Accordingly, the Company’s net loss applicable to common shareholders, as well as the loss per share, for the year ended December 31, 2002, is being restated to record a $2.1 million deemed dividend in the statement of operations, with a resulting increase in the loss applicable to common shareholders and loss per share.

The Company is filing today its Annual Report on Form 10-K for the year ended December 31, 2004, which will reflect the restated loss per share for the year ended December 31, 2002. Note 2 to the Company’s Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K filed today, sets forth additional information on the change in accounting principle.

Item 9.01 Financial Statements and Exhibits

Exhibit No.	Description
99.1	Restated Financial Statements for the quarter ended September 30, 2004

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.

	INTEREP NATIONAL RADIO SALES, INC. (Registrant)
Date: April 15, 2005	By:	/s/ WILLIAM J. MCENTEE, JR.
		William J. McEntee, Jr.
		Senior Vice President and
		Chief Financial Officer

Exhibit Index

Exhibit No.	Description
99.1	Restated Financial Statements for the quarter ended September 30, 2004

EX-99.1

Exhibit 99.1

INTEREP NATIONAL RADIO SALES, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share information)

	September 30, 2004
	As Reported			Adjustment			Restated
	(unaudited)						(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	15,023		$	—		$	15,023
Receivables, less allowance for doubtful accounts of $754 and $808, respectively		21,685			—			21,685
Representation contract buyouts receivable		400			—			400
Current portion of deferred representation contract costs		13,866			—			13,866
Prepaid expenses and other current assets		1,205			—			1,205
Total current assets		52,179			—			52,179
Fixed assets, net		3,705			—			3,705
Deferred representation contract costs		35,865			—			35,865
Representation contract buyouts receivable		646			—			646
Investments and other assets		5,504			(561	)		4,943
Total assets	$	97,899		$	(561	)	$	97,338
LIABILITIES AND SHAREHOLDERS’ DEFICIT
Current liabilities:
Accounts payable and accrued expenses	$	25,836		$	—		$	25,836
Accrued interest		2,475			—			2,475
Representation contract buyouts payable		5,245			—			5,245
Accrued employee-related liabilities		2,643			—			2,643
Total current liabilities		36,199			—			36,199
Long-term debt		99,000			—			99,000
Representation contract buyouts payable		3,627			—			3,627
Other noncurrent liabilities		2,393			—			2,393
Shareholders’ deficit:
4% Series A cumulative convertible preferred stock, $0.01 par value – 400,000 shares authorized, 118,598 and 114,037 shares issued and outstanding at September 30, 2004 and December 31, 2003, respectively (aggregate liquidation preference – $11,859)		1			—			1
Class A common stock, $0.01 par value – 20,000,000 shares authorized, 6,626,270 and 6,189,460 shares issued and outstanding at September 30, 2004 and December 31, 2003, respectively		66			—			66
Class B common stock, $0.01 par value – 10,000,000 shares authorized, 4,225,871 and 4,058,699 shares issued and outstanding at September 30, 2004 and December 31, 2003, respectively		42			—			42
Additional paid-in-capital		52,330			—			52,330
Accumulated deficit		(95,759	)		(561	)		(96,320	)
Total shareholders’ deficit		(43,320	)		(561	)		(43,881	)
Total liabilities and shareholders’ deficit	$	97,899		$	(561	)	$	97,338

INTEREP NATIONAL RADIO SALES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

	Three months ended September 30, 2004
	As reported		Adjustment			Restated
Commission revenues	$	18,556	$	—		$	18,556
Contract termination revenue		18,844		—			18,844
Total revenues		37,400		—			37,400
Operating expenses:
Selling expenses		15,964		—			15,964
General and administrative expenses		3,576		—			3,576
Depreciation and amortization expense		4,829		—			4,829
Total operating expenses		24,369		—			24,369
Operating income		13,031		—			13,031
Interest expense, net		2,634		—			2,634
Income on investment		—		37			37
Income before income taxes and cumulative change in accounting principle		10,397		37			10,434
Income taxes		35					35
Income before cumulative change in accounting principle		10,362		37			10,399
Cumulative change in accounting principle		—		(598	)		(598	)
Net loss		10,362		(561	)		9,801
Preferred stock dividend		119		—			119
Net income (loss) applicable to common shareholders	$	10,243	$	(561	)	$	9,682
Basic and fully diluted income (loss) per share applicable to common shareholders	$	0.94	$	(0.05	)	$	0.89

INTEREP NATIONAL RADIO SALES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

	Nine month ended September 30, 2004
	As reported			Adjustment			Restated
Commission revenues	$	56,077		$	—		$	56,077
Contract termination revenue		20,008			—			20,008
Total revenues		76,085			—			76,085
Operating expenses:
Selling expenses		46,614			—			46,614
General and administrative expenses		10,972			—			10,972
Depreciation and amortization expense		15,045			—			15,045
Total operating expenses		72,631			—			72,631
Operating income		3,454			—			3,454
Interest expense, net		7,952			—			7,952
Income on investment		—			37			37
(Loss) income before income taxes and cumulative change in accounting principle		(4,498	)		37			(4,461	)
Income taxes		227						227
(Loss) income before cumulative change in accounting principle		(4,725	)		37			(4,688	)
Cumulative change in accounting principle		—			(598	)		(598	)
Net loss		(4,725	)		(561	)		(5,286	)
Preferred stock dividend		350			—			350
Net loss applicable to common shareholders	$	(5,075	)	$	(561	)	$	(5,636	)
Basic and fully diluted loss per share applicable to common shareholders	$	(0.48	)	$	(0.05	)	$	(0.53	)

INTEREP NATIONAL RADIO SALES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Nine months ended September 30, 2004
	As reported			Adjustment			Restated
Cash flows from operating activities:
Net loss	$	(4,725	)	$	(561	)	$	(5,286	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		15,045			—			15,045
Income on investment		—			(37	)		(37	)
Cumulative change in accounting principle		—			598			598
Changes in assets and liabilities:
Receivables		5,900			—			5,900
Representation contract buyouts receivable		(578	)		—			(578	)
Prepaid expenses and other current assets		(93	)		—			(93	)
Other noncurrent assets		(202	)		—			(202	)
Accounts payable and accrued expenses		5,678			—			5,678
Accrued interest		(2,475	)		—			(2,475	)
Accrued employee-related liabilities		(670	)		—			(670	)
Other noncurrent liabilities		(1,487	)		—			(1,487	)
Net cash provided by operating activities		16,393			—			16,393
Cash flows from investing activities:
Additions to fixed assets		(817	)		—			(817	)
Increase in other investments		(5	)		—			(5	)
Net cash used in investing activities		(822	)		—			(822	)
Cash flows from financing activities:
Station representation contract payments		(5,289	)		—			(5,289	)
Gross borrowings on credit facility		21,650			—			21,650
Gross repayments on credit facility		(25,650	)		—			(25,650	)
Repayment of prior credit facility		—			—			—
Issuance of Class B common stock		1,080			—			1,080
Net borrowings on new credit facility, net of financing costs		—			—			—
Net cash used in financing activities		(8,209	)		—			(8,209	)
Net increase (decrease) in cash and cash equivalents		7,362			—			7,362
Cash and cash equivalents, beginning of period		7,661			—			7,661
Cash and cash equivalents, end of period	$	15,023		$	—		$	15,023
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	10,146			—		$	10,146
Income taxes		227			—			227
Non-cash investing and financing activities:
Station representation contracts acquired	$	2,106			—		$	2,106
Preferred stock dividend		350			—			350