-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JhBUZAGRhdAxC/2HKd0vMIJ1N+l5HLS6SVsaVKfYWoqot8v5rA+D+rBH5/9DeLub RA0T6dKoalrlDbyFhJW7Ng== 0000950134-98-005058.txt : 19980609 0000950134-98-005058.hdr.sgml : 19980609 ACCESSION NUMBER: 0000950134-98-005058 CONFORMED SUBMISSION TYPE: 424B5 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19980608 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: LAMAR ADVERTISING CO CENTRAL INDEX KEY: 0000899045 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-ADVERTISING AGENCIES [7311] IRS NUMBER: 721205791 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 424B5 SEC ACT: SEC FILE NUMBER: 333-52851 FILM NUMBER: 98643633 BUSINESS ADDRESS: STREET 1: 5551 CORPORATE BLVD CITY: BATON ROUGE STATE: LA ZIP: 70808 BUSINESS PHONE: 5049261000 MAIL ADDRESS: STREET 1: 5551 CORPORATE BOULEVARD CITY: BATON ROUGE STATE: LA ZIP: 70808 424B5 1 FINAL PROSPECTUS SUPPLEMENT 1 Filed Pursuant to Rule 424(b)(5) Registration Nos. 333-50559 and 333-52581 PROSPECTUS SUPPLEMENT (TO PROSPECTUS DATED APRIL 28, 1998 AND PROSPECTUS DATED MAY 18, 1998) 6,375,000 SHARES [LAMAR LOGO] CLASS A COMMON STOCK --------------------- All of the 6,375,000 shares of Class A Common Stock, $0.001 par value per share (the "Class A Common Stock"), offered hereby are being issued and sold by Lamar Advertising Company (the "Company"). Certain stockholders of the Company (the "Selling Stockholders") have granted the Underwriters a 30-day option to purchase an additional 956,250 shares of Class A Common Stock, subject to the right of the Company to sell up to 478,125 of such shares; information regarding the Selling Stockholders is included in the Selling Stockholder Prospectus being delivered along with this Prospectus Supplement and the accompanying Base Prospectus. The Class A Common Stock is included for quotation on the Nasdaq National Market under the symbol "LAMR." On June 4, 1998, the last reported sale price for the Class A Common Stock as reported on the Nasdaq National Market was $29.88 per share. The Company's authorized capital stock includes the Class A Common Stock and shares of Class B Common Stock, $0.001 par value per share (the "Class B Common Stock"). The economic rights of the Class A Common Stock and the Class B Common Stock (collectively, the "Common Stock") are identical, except that each share of Class A Common Stock entitles the holder thereof to one vote in respect of matters submitted for the vote of holders of Common Stock, whereas each share of Class B Common Stock entitles the holder thereof to ten votes on such matters. Immediately after this offering (this "Offering"), the Reilly Family Limited Partnership, of which Kevin P. Reilly, Jr., the Company's Chief Executive Officer, is managing general partner, will have the power to vote all of the outstanding shares of Class B Common Stock (representing approximately 84.2% of the aggregate voting power of the Common Stock, assuming no exercise of the Underwriters' over-allotment option). Each share of Class B Common Stock converts automatically into one share of Class A Common Stock upon sale or other transfer to a party other than Permitted Transferees (as defined in the accompanying Prospectus). See "Description of Capital Stock" in the accompanying Base Prospectus. --------------------- SEE "RISK FACTORS" BEGINNING ON PAGE B-5 OF THE ACCOMPANYING BASE PROSPECTUS AND PAGE SS-3 OF THE ACCOMPANYING SELLING STOCKHOLDERS PROSPECTUS FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE SHARES OF CLASS A COMMON STOCK OFFERED HEREBY. --------------------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
================================================================================================================================= PRICE UNDERWRITING PROCEEDS TO DISCOUNTS AND TO PUBLIC COMMISSIONS COMPANY(1) - --------------------------------------------------------------------------------------------------------------------------------- Per Share............................................. $29.00 $1.16 $27.84 - --------------------------------------------------------------------------------------------------------------------------------- Total(2).............................................. $184,875,000 $7,395,000 $177,480,000 =================================================================================================================================
(1) Before deducting expenses of the offering estimated at $200,000, all of which will be paid by the Company. (2) The Selling Stockholders have granted to the Underwriters a 30-day option to purchase up to 956,250 additional shares of Class A Common Stock solely to cover over-allotments, if any. The Company has the right to sell up to 478,125 of such shares. To the extent that the option is exercised, the Underwriters will offer the additional shares at the Price to Public shown above. If the option is exercised in full, the total Price to Public, Underwriting Discounts and Commissions, and, if the Company does not participate, proceeds to the Selling Stockholders will be $212,606,250, $8,504,250 and $26,622,000, respectively. If the Company participates in full, the proceeds to the Company will be $190,791,000 and to the Selling Stockholders will be $13,311,000. See "Underwriting." --------------------- The shares of Class A Common Stock are being offered by the several Underwriters, subject to prior sale, when, as and if delivered and accepted by them, and subject to the right of the Underwriters to reject any order in whole or in part. It is expected that delivery of the shares of Class A Common Stock will be made at the offices of BT Alex. Brown Incorporated, Baltimore, Maryland, on or about June 10, 1998. BT ALEXS BROWN SALOMON SMITH BARNEY NATIONSBANC MONTGOMERY SECURITIES LLC PRUDENTIAL SECURITIES INCORPORATED DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION THE DATE OF THIS PROSPECTUS SUPPLEMENT IS JUNE 5, 1998 2 CERTAIN PERSONS PARTICIPATING IN THE OFFERING MAY ENGAGE IN TRANSACTIONS THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK, INCLUDING OVER-ALLOTMENT, STABILIZING AND SHORT COVERING TRANSACTIONS AND THE IMPOSITION OF A PENALTY BID. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING." IN CONNECTION WITH THIS OFFERING, CERTAIN UNDERWRITERS MAY ENGAGE IN PASSIVE MARKET MAKING TRANSACTIONS IN THE COMMON STOCK ON THE NASDAQ NATIONAL MARKET IN ACCORDANCE WITH RULE 103 OF REGULATION M. SEE "UNDERWRITING." 3 This Prospectus Supplement and the accompanying Base Prospectus and Selling Stockholder Prospectus, including documents incorporated by reference, contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such forward-looking statements involve risks and uncertainties that could cause the actual results, performance or achievements of the Company, or industry results, to differ materially from the results, performance or achievements expressed or implied by such forward-looking statements. Such risks and uncertainties include, among others, the risks and uncertainties described under the caption "Risk Factors" in the accompanying Base Prospectus and Selling Stockholder Prospectus. These forward-looking statements speak only as of the date on which they were made. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Unless otherwise indicated, the information in this Prospectus Supplement assumes that the Underwriters' over-allotment option is not exercised. THE COMPANY Lamar Advertising Company together with its consolidated subsidiaries (collectively, the "Company") is one of the largest and most experienced owners and operators of outdoor advertising structures in the United States. It conducts a business that has operated under the Lamar name since 1902. As of April 30, 1998, the Company operated approximately 52,000 outdoor advertising displays in 34 states. The Company provides a full array of poster and bulletin displays in 62 of its 75 markets. In its remaining 13 markets, the Company operates high-profile bulletin displays along interstate and other major highways. The Company also operates the largest logo sign business in the United States. Logo signs are erected pursuant to state-awarded franchises on public rights-of-way near highway exits and deliver brand name information on available gas, food, lodging and camping services. The Company currently operates logo sign franchises in 18 of the 22 states that have a privatized logo sign program. As of April 30, 1998, the Company maintained over 22,700 logo sign structures containing approximately 68,900 logo advertising displays under these franchises. In addition, the Company operates the tourism signage franchises in four states and the province of Ontario, Canada. The Company has also expanded into the transit advertising business through the operation of displays on bus shelters, bus benches and buses in fourteen of its primary markets and five other markets in the states of South Carolina, Utah and Georgia. For the year ended December 31, 1997, net revenues and EBITDA increased 66.7% and 84.8%, respectively, as compared to the year ended October 31, 1996. For the three months ended March 31, 1998, net revenues and EBITDA increased 54.3% and 61.0%, respectively, as compared to the same period in 1997. The Company's strategy is to be the leading provider of outdoor advertising in the markets it serves, with an historical emphasis on providing a full range of outdoor advertising services in middle markets. Important elements of the Company's strategy are its decentralized management structure and its focus on providing high quality local sales and service. In order to be more responsive to local market demands, the Company offers a full complement of outdoor advertising services coupled with local production facilities, management and account executives through its local offices. Local advertising constituted approximately 80% of the Company's outdoor advertising net revenues in calendar 1997, which management believes is higher than the industry average. While maintaining its local focus, the Company seeks to expand its operations within existing and contiguous markets. The Company also pursues expansion opportunities, including acquisitions, in additional markets. In the logo sign business, the Company's strategy is to maintain its position as the largest operator of logo signs in the United States by expanding through the addition of state logo franchises as they are awarded and through possible acquisitions. The Company may also pursue expansion opportunities in transit and other out-of-home media which the Company believes will enable it to leverage its management skills and market position. The Company believes that the experience of its senior and local managers has contributed greatly to its success. Its regional managers have been with the Company, on average, for 24 years. The Company emphasizes decentralized local management of operations with centralized support and financial and S-3 4 accounting controls. As a result of this local operating focus, the Company maintains an extensive local presence within its markets and employed a total of 256 local account executives at March 31, 1998. Local account executives are typically supported by additional local staff and have the ability to draw upon the resources of the central office and offices in other markets in the event that business opportunities or customers' needs support such allocation of resources. RECENT DEVELOPMENTS COMPLETED ACQUISITIONS Since January 1, 1998, the Company has acquired the assets of several complementary businesses. The Company believes that these acquisitions allow the Company to capitalize on the operating efficiencies and cross-market sales opportunities. The Ragan Acquisition On January 2, 1998, the Company acquired all of the outdoor advertising assets of Ragan Outdoor ("Ragan") for a cash purchase price of $25.0 million. This acquisition consisted of a total of 1,300 posters and 170 bulletins in Rockford, Illinois, Cedar Rapids, Iowa and Davenport, Iowa. The Derby Acquisition On January 8, 1998, the Company acquired all of the assets of Derby Outdoor Advertising ("Derby") for a cash purchase price of approximately $6.0 million. This acquisition consisted of approximately 270 posters and 210 bulletin displays located in Rapid City, South Dakota. The Pioneer Acquisition On January 30, 1998, the Company acquired the outdoor advertising assets of Pioneer Advertising Company ("Pioneer") for a cash purchase price of $19.2 million. This acquisition consisted of 650 posters and 1,900 bulletin displays located in Springfield and Bonne Terre, Missouri. The Northwest Acquisition On April 30, 1998, the Company acquired the assets of Northwest Outdoor Advertising, L.L.C. ("Northwest") for a cash purchase price of $68.5 million. This acquisition consisted of approximately 2,500 posters and 1,400 bulletin displays, and provided entry into the states of Washington, Montana, Oregon, Idaho, Wyoming, Nebraska, Nevada and Utah. The Company plans to operate the assets out of four primary offices located in Spokane, Washington, Boise, Idaho, Billings, Montana and Casper, Wyoming. The Sun Acquisition On June 1, 1998 the Company purchased all of the assets of Sun Media ("Sun") for a cash purchase price of $26.5 million. The Sun acquisition added the primary market of Tacoma, Washington with 400 posters and 100 bulletins. Other Acquisitions From January 1, 1998 through April 30, 1998, the Company completed 7 other acquisitions of assets located near existing company operations. These acquisitions consisted of a cumulative total of approximately 270 poster and 500 bulletin displays. The cumulative cash purchase price was approximately $11 million. OTHER ACQUISITION ACTIVITY The Company is in discussions regarding the purchase of all the outstanding capital stock of another outdoor advertising company. The Company currently expects that the purchase price for this acquisition S-4 5 would be approximately $205 million payable in cash and shares of the Company's Class A Common Stock. This acquisition would add approximately 4,200 posters and 2,800 bulletin displays in twelve new primary markets. This acquisition is subject to negotiation and execution of a definitive agreement, the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, the satisfaction of other customary closing conditions and the completion by the owners of the sale of their other outdoor advertising assets to a third party. The Company currently anticipates closing in the fourth quarter of 1998 subject to satisfaction of closing conditions. There can be no assurance that this pending acquisition will be completed or as to the timing of its completion. NEW CREDIT FACILITY The Company is currently negotiating to replace its existing credit facility with a syndicate of commercial lenders (the "Senior Credit Facility") with a new credit agreement (the "New Credit Agreement") agented by Chase Manhattan Bank, the agent under the Senior Credit Facility (the "Agent"). The New Credit Agreement would increase the Company's borrowing availability to $400 million, with a $250 million revolving facility and a $150 million term loan facility. Beginning in the year 2000 there will be quarterly commitment reductions of the revolver and amortization of the term loans, with both facilities maturing on December 31, 2005. Interest on borrowings under the facilities will be calculated, at the Company's option, at a spread above either the "Base Rate" announced by the Agent or the London Interbank Offered Rate ("LIBOR"), such spread to be determined by reference to the Company's trailing leverage ratio (total debt to trailing 12 months EBITDA). The Company also expects that the New Credit Agreement will provide for an uncommitted $100 million incremental facility available at the discretion of the lenders. Lamar Advertising Company's obligations under the New Credit Agreement will be guaranteed by substantially all of its subsidiaries and secured by a pledge of the capital stock of such subsidiaries, both in a manner similar to the Senior Credit Facility. The Company expects that the New Credit Agreement will have restrictive covenants and events of default similar to, but in certain cases less restrictive than, those under the Senior Credit Facility. The Company expects the New Credit Agreement will be executed shortly after completion of this Offering. There can be no assurance, however, that the Company will enter into the New Credit Agreement or that its terms will not differ from those described above. S-5 6 THE OFFERING Class A Common Stock offered by the Company............................. 6,375,000 shares Common Stock to be outstanding after the Offering........................ 35,080,565 shares of Class A Common Stock(1) 18,762,912 shares of Class B Common Stock 53,843,477 total shares of Common Stock Use of proceeds..................... For general corporate purposes, including the repayment of a portion of outstanding senior indebtedness and the payment of a portion of the purchase price payable in connection with acquisitions. See "Use of Proceeds." Voting rights....................... The holders of the Class A Common Stock and the holders of the Class B Common Stock vote together as a single class (except as may be otherwise required by Delaware law) on all matters submitted to a vote of stockholders, with each share of Class A Common Stock entitled to one vote and each share of Class B Common Stock entitled to ten votes. Each share of Class B Common Stock converts automatically into one share of Class A Common Stock upon the sale or other transfer of such share of Class B Common Stock to a person or entity other than a Permitted Transferee (as defined under "Description of Capital Stock -- Common Stock" in the accompanying Base Prospectus). Each class of Common Stock otherwise has identical rights. Nasdaq National Market Symbol....... LAMR - --------------- (1) Excludes 1,683,185 shares of Class A Common Stock issuable under outstanding options granted pursuant to the Company's 1996 Equity Incentive Plan. RISK FACTORS Investors should consider the risks involved in an investment in the Class A Common Stock, including potential events which could adversely affect the Company's business. See "Risk Factors" in the accompanying Base Prospectus and Selling Stockholder Prospectus. S-6 7 SELECTED CONSOLIDATED HISTORICAL FINANCIAL AND OPERATING DATA
THREE MONTHS ENDED YEAR ENDED OCTOBER 31, YEAR ENDED --------------------- --------------------------------------- DECEMBER 31, MARCH 31, MARCH 31, 1993 1994 1995 1996 1997(1) 1997 1998 ------- ------- -------- -------- ------------ --------- --------- Net revenues...................... $66,524 $84,473 $102,408 $120,602 $201,062 $37,847 $58,397 Operating Expenses Direct advertising expenses..... 23,830 28,959 34,386 41,184 63,390 13,467 20,830 General and administrative expenses...................... 19,504 24,239 27,057 29,466 45,368 9,253 13,216 Depreciation and amortization... 8,924 11,352 14,090 15,549 48,037 6,750 17,605 ------- ------- -------- -------- -------- ------- ------- Total operating expenses............... 52,258 64,550 75,533 86,199 156,795 29,470 51,651 ------- ------- -------- -------- -------- ------- ------- Operating income.................. 14,266 19,923 26,875 34,403 44,267 8,377 6,746 ------- ------- -------- -------- -------- ------- ------- Interest expense.................. 11,502 13,599 15,783 15,441 38,230 6,944 13,326 Earnings (loss) before income taxes and extraordinary items... 1,677 5,227 8,308 17,948 7,495 2,094 (6,156) Income tax expense (benefit)(2)... 476 (2,072) (2,390) 7,099 4,654 798 (1,565) Net earnings (loss)(3)............ (653) 7,299 10,698 10,849 2,841 1,296 (4,591) OTHER DATA: EBITDA(4)......................... 23,190 31,275 40,965 49,952 92,304 15,127 24,351 EBITDA margin..................... 35% 37% 40% 41% 46% 40% 42% Capital expenditures: Outdoor advertising............. 2,374 4,997 6,643 12,530 23,445 4,578 7,691 Logos........................... 2,009 2,761 1,567 13,268 10,354 141 1,306 Number of outdoor advertising displays(5)..................... 17,659 22,369 22,547 24,792 43,343 29,753 47,475 Number of logo advertising displays(5)..................... 13,820 18,266 24,219 52,414 68,600 64,658 68,935 Cumulative logo sign franchises(5)................... 7 7 11 15 18 18 18
MARCH 31, 1998 -------------------------- ACTUAL AS ADJUSTED(6) -------- -------------- BALANCE SHEET DATA: Cash and cash equivalents................................... $ 4,041 $ 72,321 Working capital............................................. 16,432 84,712 Total assets................................................ 699,542 767,822 Total debt (including current maturities)................... 588,207 479,207 Total long-term obligations................................. 600,470 491,470 Stockholders' equity........................................ 68,337 245,617
- --------------- (1) In December 1996, the Company changed its fiscal year from October 31 to December 31. (2) The benefit of the Company's net operating loss carryforward was fully recognized as of October 31, 1995, resulting in the income tax expense shown for the year ended October 31, 1996 and the year ended December 31, 1997. (3) Includes, in 1993, an extraordinary loss on debt extinguishment, net of an income tax benefit, of $1.9 million. (4) "EBITDA" is defined as operating income before depreciation and amortization. EBITDA represents a measure which management believes is customarily used to evaluate the financial performance of companies in the media industry. However, EBITDA is not a measure of financial performance under generally accepted accounting principles and should not be considered an alternative to operating income or net earnings as an indicator of the Company's operating performance or to net cash provided by operating activities as a measure of its liquidity. (5) As of the end of the period. (6) Adjusted to give effect to the offering hereby of 6,375,000 shares of Class A Common Stock. S-7 8 USE OF PROCEEDS The Company intends to use the net proceeds from this Offering, estimated to be approximately $177 million (or approximately $191 million if the Underwriters' over-allotment option is exercised in full and the Company elects to participate for its full portion) after deducting underwriting discounts and commissions and estimated fees and expenses, to repay amounts currently outstanding under the Senior Credit Facility. This will increase the amount available for borrowing under the Senior Credit Facility. Borrowings under the Senior Credit Facility bear interest computed as a margin over either The Chase Manhattan Bank's "Base Rate" or LIBOR. The margins range from 0 to 100 basis points and from 100 to 225 basis points over the Base Rate and LIBOR, respectively, depending on the Company's current leverage ratio. The Company plans to finance the cash portion of the purchase price for acquisitions by utilizing the borrowing availability under the Senior Credit Facility. See "Recent Developments -- Pending Acquisitions." Pending such uses, the net proceeds may be invested by the Company in short-term money market instruments. The Company will not receive any proceeds from the sale of any shares sold by the Selling Stockholders in connection with the exercise of the over-allotment option. S-8 9 BUSINESS Lamar Advertising Company is one of the largest and most experienced owners and operators of outdoor advertising structures in the United States. It conducts a business that has operated under the Lamar name since 1902. As of April 30, 1998, the Company operated approximately 52,000 outdoor advertising displays in 34 states. The Company provides a full array of poster and bulletin displays in 62 of its 75 markets. In its remaining 13 markets, the Company operates high-profile bulletin displays along interstate and other major highways. The Company also operates the largest logo sign business in the United States. Logo signs are erected pursuant to state-awarded franchises on public rights-of-way near highway exits and deliver brand name information on available gas, food, lodging and camping services. The Company currently operates logo sign franchises in 18 of the 22 states that have a privatized logo sign program. As of April 30, 1998, the Company maintained over 22,700 logo sign structures containing approximately 68,900 logo advertising displays under these franchises. In addition, the Company operates the tourism signage franchises in four states and the province of Ontario, Canada. The Company has also expanded into the transit advertising business through the operation of displays on bus shelters, bus benches and buses in fourteen of its primary markets and five other markets in the states of South Carolina, Utah and Georgia. OUTDOOR ADVERTISING MARKETS The following table sets forth certain information regarding the Company's existing primary outdoor advertising markets listed in order of net revenue by state and primary market.
NUMBER OF DISPLAYS(3) -------------------- STATE/PRIMARY MARKET(1) MARKET RANK(2) BULLETINS POSTERS ----------------------- -------------- --------- ------- PENNSYLVANIA York..................................................... 103 264 1,113 Allentown................................................ 65 266 0 Reading.................................................. 130 192 551 Williamsport............................................. 240 202 715 Erie..................................................... 152 161 510 Altoona.................................................. 234 57 430 ------ ------ Total............................................ 1,142 3,319 LOUISIANA Baton Rouge.............................................. 81 395 553 Shreveport............................................... 127 330 714 Lafayette................................................ 98 290 348 Lake Charles............................................. 203 251 282 Monroe................................................... 226 194 440 New Orleans.............................................. 39 65 0 Houma.................................................... -- 60 298 Alexandria............................................... 199 142 330 Hammond.................................................. -- 197 131 Slidell.................................................. -- 46 0 ------ ------ Total............................................ 1,970 3,096 TENNESSEE Nashville................................................ 44 677 1,109 Knoxville................................................ 68 652 924 Clarksville.............................................. -- 153 412 ------ ------ Total............................................ 1,482 2,445
S-9 10
NUMBER OF DISPLAYS(3) -------------------- STATE/PRIMARY MARKET(1) MARKET RANK(2) BULLETINS POSTERS ----------------------- -------------- --------- ------- FLORIDA Pensacola................................................ 125 303 678 Lakeland................................................. 104 501 392 Fort Myers............................................... 76 141 294 Panama City.............................................. 225 295 431 Tallahassee.............................................. 167 177 262 Fort Walton.............................................. 205 187 222 Daytona Beach............................................ 93 57 309 ------ ------ Total............................................ 1,661 2,588 GEORGIA Atlanta.................................................. 12 305 0 Savannah................................................. 154 226 436 Augusta.................................................. 107 267 487 Valdosta................................................. -- 314 266 Albany................................................... 243 154 292 Brunswick................................................ -- 144 158 ------ ------ Total............................................ 1,410 1,639 NEW YORK Buffalo.................................................. 40 136 1,221 Rochester................................................ 46 79 593 Syracuse................................................. 70 74 699 ------ ------ Total............................................ 289 2,513 MISSISSIPPI Jackson.................................................. 118 714 646 Gulfport................................................. 134 330 391 Hattiesburg.............................................. -- 282 169 ------ ------ Total............................................ 1,326 1,206 VIRGINIA Richmond................................................. 56 372 1,021 Roanoke.................................................. 102 258 751 ------ ------ Total............................................ 630 1,772 TEXAS Brownsville.............................................. 63 203 854 Houston.................................................. 9 257 0 Beaumont................................................. 128 188 319 Corpus Christi........................................... 126 193 532 Wichita Falls............................................ 235 166 151 Laredo................................................... 210 80 360 ------ ------ Total............................................ 1,087 2,216 ALABAMA Mobile................................................... 84 804 639 Montgomery............................................... 140 457 523 ------ ------ Total............................................ 1,261 1,162 MICHIGAN Detroit.................................................. 6 502 0 WEST VIRGINIA Wheeling................................................. 215 170 552 Huntington............................................... 139 92 494 Bridgeport............................................... -- 121 300 Bluefield................................................ -- 301 295 ------ ------ Total............................................ 684 1,641
S-10 11
NUMBER OF DISPLAYS(3) -------------------- STATE/PRIMARY MARKET(1) MARKET RANK(2) BULLETINS POSTERS ----------------------- -------------- --------- ------- OHIO Youngstown............................................... 92 292 586 Dayton................................................... 54 2 515 ------ ------ Total............................................ 294 1,101 COLORADO Colorado Springs......................................... 95 163 349 Denver................................................... 23 170 0 ------ ------ Total............................................ 333 349 SOUTH CAROLINA Columbia................................................. 88 355 597 MISSOURI Statewide Highways....................................... N/A 880 0 Springfield.............................................. N/A 1,290 603 East Missouri............................................ 618 175 ------ ------ Total............................................ 2,788 778 KENTUCKY Lexington................................................ 105 112 521 Louisville............................................... 50 33 0 ------ ------ Total............................................ 145 521 NORTH CAROLINA Statewide Highways....................................... N/A 883 131 KANSAS Kansas City.............................................. 27 221 0 ARIZONA Phoenix.................................................. 18 134 0 CALIFORNIA Sacramento............................................... 28 59 0 MONTANA Billings................................................. 238 493 527 WASHINGTON Spokane.................................................. 87 107 660 IDAHO Boise.................................................... 129 841 256 WYOMING Casper................................................... 263 536 442 SOUTH DAKOTA Rapid City............................................... 248 625 272 IOWA Davenport/Quad Cities.................................... 132 60 761 Cedar Rapids............................................. 197 31 175 ------ ------ Total............................................ 91 936 ILLINOIS Rockford................................................. 149 81 390 TOTAL............................................ 21,430 30,557 ====== ======
S-11 12 LOGO SIGN FRANCHISES The following table sets forth certain information regarding the Company's logo business operations. As of March 31, 1998, the Company operated approximately 68,900 logo advertising displays.
# OF LOGO YEAR ADVERTISING AWARDED FRANCHISE DISPLAYS - ------- --------- ----------- 1989 Nebraska(4).............. 853 1989 Oklahoma................. 1,495 1990 Utah..................... 1,756 1991 Missouri(5).............. 8,400 1992 Ohio(4).................. 5,953 1993 Texas.................... 3,937 1993 Mississippi.............. 3,171 1995 Georgia.................. 10,581 1995 Minnesota................ 2,838 1995 South Carolina........... 2,242
# OF LOGO YEAR ADVERTISING AWARDED FRANCHISE DISPLAYS - ------- --------- ----------- 1996 Virginia................. 7,544 1996 Michigan(4).............. 1,480 1996 Tennessee................ 4,574 1996 Kansas................... 2,307 1996 New Jersey............... 1,221 1996 Florida.................. 4,873 1996 Kentucky(4).............. 5,049 1996 Nevada................... 661 Total.................... 68,935 ======
- --------------- (1) Includes additional or outlying markets served by the office in the applicable market. (2) Indicates the Winter 1997 Arbitron Radio Metro Market ranking for the market within which the office is located. The Company believes that Metro Market ranking, which ranks, according to population of persons 12 years or older, the largest 263 markets in the U.S., is a standard measure of market size used by the media industry. Where no market ranking is shown, such market is not ranked by Arbitron. (3) The display count is as of March 31, 1998, pro forma for all acquisitions completed as of April 30, 1998. (4) Excludes tourist oriented directional logo signs operated by the Company pursuant to its franchise with the state. (5) Franchise operated by a 66.7% owned partnership. S-12 13 MANAGEMENT The executive officers and directors of the Company as of April 30, 1998 were as follows:
YEARS WITH NAME AGE TITLE THE COMPANY - ---- --- ----- ----------- Kevin P. Reilly, Jr.................. 43 Chairman, President, Chief Executive Officer and Director 20 Keith A. Istre....................... 45 Chief Financial Officer, Treasurer and Director 20 Charles W. Lamar, III................ 49 General Counsel, Secretary and Director 16 Gerald H. Marchand................... 67 Vice President, Regional Manager of Baton Rouge Region, and Director 39 T. Everett Stewart, Jr............... 44 President of Interstate Logos, Inc., a subsidiary of the Company, and Director 18 Jack S. Rome, Jr..................... 49 Director -- William R. Schmidt................... 46 Director --
Kevin P. Reilly, Jr. has served as the Company's President and Chief Executive Officer since February 1989 and as a director of the Company since February 1984. Mr. Reilly served as President of the Company's Outdoor Division from 1984 to 1989. Mr. Reilly, an employee of the Company since 1978, has also served as Assistant and General Manager of the Company's Baton Rouge Region and Vice President and General Manager of the Louisiana Region. Mr. Reilly received a B.A. from Harvard University in 1977. Keith A. Istre has been Chief Financial Officer of the Company since February 1989 and a director of the Company since February 1991. Mr. Istre joined the Company as Controller in 1978 and became Treasurer in 1985. Prior to joining the Company, Mr. Istre was employed by a public accounting firm in Baton Rouge from 1975 to 1978. Mr. Istre graduated from the University of Southwestern Louisiana in 1974 with a degree in accounting. Charles W. Lamar, III joined the Company in 1982 as General Counsel and has been a director of the Company since June 1973. Prior to joining the Company, Mr. Lamar maintained his own law practice and was employed by a law firm in Baton Rouge. Mr. Lamar received a B.A. in Philosophy from Harvard University in 1971, a M.A. in Economics from Tufts University in 1972 and a J.D. from Boston University in 1975. Gerald H. Marchand has been Regional Manager of the Baton Rouge Region, which encompasses operations in Louisiana, Mississippi and Texas, since 1988 and a director of the Company since 1978. He began his career with the Company in leasing and went on to become President of the Outdoor Division. He has served as General Manager of the Lake Charles and Mobile operations. Mr. Marchand received a Masters in Education from Louisiana State University in 1955. T. Everett Stewart, Jr. has been President of Interstate Logos, Inc. since 1988, and has recently been named a director. He served as Regional Manager of the Company's Baton Rouge Region from 1984 to 1988. Previously, he served the Company as Sales Manager in Montgomery and General Manager of the Monroe and Alexandria operations. Before joining the Company in 1979, Mr. Stewart was employed by the Lieutenant Governor of the State of Alabama and by a United States Senator from the State of Alabama. Mr. Stewart received a B.S. in Finance from Auburn University in 1976. Jack S. Rome, Jr. has been a director of the Company since 1974. Since 1988, Mr. Rome has been President of No Fault Industries, Inc., a construction company specializing in outdoor recreational facilities. Mr. Rome has also served as President of Jack Rome, Jr. & Associates, Inc., a management consulting company, since October 1987. Mr. Rome served the Company in various capacities from 1975 to 1986. Mr. Rome received his B.S. in accounting from Southeastern Louisiana University in 1971. William R. Schmidt became a director of the Company in 1994. He is an officer of Pacific Mutual Life Insurance Company in its Securities Department, where he has been employed since 1990. He has a B.S. in Finance from Pennsylvania State University and an MBA from the Amos Tuck School of Business at Dartmouth College. Kevin P. Reilly, Jr. and Charles W. Lamar, III are cousins. S-13 14 UNDERWRITING Subject to the terms and conditions of the Underwriting Agreement, the Underwriters named below (the "Underwriters") have severally agreed to purchase from the Company the following respective number of shares of Class A Common Stock at the initial public offering price less the underwriting discounts and commissions set forth on the cover page of this Prospectus Supplement.
NUMBER OF UNDERWRITER SHARES ----------- --------- BT Alex. Brown Incorporated................................. 1,275,000 Smith Barney Inc............................................ 1,275,000 NationsBanc Montgomery Securities LLC....................... 1,275,000 Prudential Securities Incorporated.......................... 1,275,000 Donaldson, Lufkin & Jenrette Securities Corporation......... 1,275,000 --------- Total............................................. 6,375,000 =========
The Underwriting Agreement provides that the obligations of the Underwriters are subject to certain conditions precedent and that the Underwriters will purchase all shares of Class A Common Stock offered hereby if any such shares are taken. The Company has been advised by the Underwriters that the Underwriters propose to offer the shares of Class A Common Stock to the public at the initial public offering price set forth on the cover page of this Prospectus Supplement and to certain dealers at such price less a concession not in excess of $0.68 per share. The Underwriters may allow, and such dealers may reallow, a concession not in excess of $0.10 per share to certain other dealers. After the initial public offering, the offering price and other selling terms may be changed by the Underwriters. The Selling Stockholders have granted to the Underwriters an option, exercisable not later than 30 days after the date of this Prospectus Supplement, to purchase up to 956,250 additional shares of Class A Common Stock at the public offering price less the underwriting discounts and commissions set forth on the cover page of this Prospectus Supplement. The Company has been granted the right, at its option, to sell up to 478,125 of such shares. Assuming that the Underwriters exercise such option in full and the Company does not elect to participate, the following persons will sell the following respective amounts: Reilly Family Limited Partnership, 645,469 shares; Charles W. Lamar, III, 119,531 shares; Mary Lee Lamar Dixon, 71,719 shares; Allison J. Lamar, 23,906 shares; Courtney J. Lamar, 47,812 shares; and Madison C. Lamar, 47,813 shares. In the event that the Underwriters exercise such option in part, the number of shares to be sold by each such person will be reduced pro rata. If the Company elects to participate in the sale, the number of shares to be sold by each such person will be reduced pro rata except to the extent the Selling Stockholders otherwise agree. To the extent that the Underwriters exercise such option, each of the Underwriters will have a firm commitment to purchase approximately the same percentage thereof that the number of shares of Class A Common Stock to be purchased by it shown in the above table bears to 6,375,000, and the Selling Stockholders will be obligated, pursuant to the option, subject to the right of the Company to participate, to sell such shares to the Underwriters. The Underwriters may exercise such option only to cover over-allotments made in connection with the sale of Class A Common Stock offered hereby. If purchased, the Underwriters will offer such additional shares on the same terms as those on which the 6,375,000 shares are being offered. Information regarding the Selling Stockholders is contained in the Selling Stockholder Prospectus delivered together with this Prospectus Supplement and the accompanying Base Prospectus. Stockholders of the Company holding in the aggregate approximately 24,199,489 shares of Common Stock have agreed not to offer, sell, contract to sell, or otherwise dispose of any shares of Common Stock for a period of 90 days from the date of this Prospectus Supplement without the prior consent of BT Alex. Brown Incorporated. In connection with this Offering, certain Underwriters and their respective affiliates may engage in passive market making transactions on the Nasdaq National Market immediately prior to the Offering in S-14 15 accordance with Rule 103 of Regulation M. Passive market making consists of displaying bids on the Nasdaq National Market limited by the bid prices of independent market makers and making purchases limited by such prices and effected in response to order flow. Net purchases by a passive market maker on each day are limited to a specified percentage of the passive market maker's average daily trading volume in the Class A Common Stock during a specified period and must be discontinued when such limit is reached. Passive market making may stabilize the market price of the Class A Common Stock at a level above that which might otherwise prevail and, if commenced, may be discontinued at any time. To facilitate the offering of the Class A Common Stock, the Underwriters may engage in transactions that stabilize, maintain or otherwise affect the market price of the Class A Common Stock. Specifically, the Underwriters may over-allot shares of the Class A Common Stock in connection with this Offering, thereby creating a short position in the Underwriters' syndicate account. Additionally to cover such over-allotments or to stabilize the market price of the Class A Common Stock, the Underwriters may bid for, and purchase, shares of the Class A Common Stock in the open market. Any of these activities may maintain the market price of the Class A Common Stock at a level above that which might otherwise prevail in the open market. The Underwriters are not required to engage in these activities, and, if commenced, any such activities may be discontinued at any time. The Company, the Selling Stockholders and the Underwriters have agreed to indemnify each other against certain liabilities, including liabilities under the Securities Act. LEGAL MATTERS The validity of the Class A Common Stock offered hereby will be passed upon for the Company by Palmer & Dodge LLP, Boston, Massachusetts. Certain matters will be passed upon for the Underwriters by Piper and Marbury L.L.P. AVAILABLE INFORMATION The Company has filed with the Securities and Exchange Commission (the "Commission") Registration Statements on Form S-3 (the "Registration Statements") under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the Class A Common Stock offered hereby. As permitted by the rules and regulations of the Commission, the Base Prospectus, the Selling Stockholder Prospectus and this Prospectus Supplement omit certain information, exhibits and undertakings contained in the Registration Statements. For further information with respect to the Company and the Class A Common Stock offered hereby, reference is made to the Registration Statements, including the exhibits thereto and the financial statements, notes and schedules filed as a part thereof. Any statements contained herein concerning provisions of any document filed as an exhibit to a Registration Statement or otherwise filed with the Commission are not necessarily complete, and in each instance reference is made to the copy of such document so filed. Each such statement is qualified in its entirety by such reference. The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith, files reports, proxy materials and other information with the Commission. The reports, proxy materials and other information filed by the Company with the Commission can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Regional Offices of the Commission at Seven World Trade Center, New York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such materials also can be obtained from the Public Reference Section of the Commission, Washington, D.C. 20549 at prescribed rates. The Commission maintains a site on the World Wide Web that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission. The address of such site is http://www.sec.gov. The Company's Class A Stock is listed on The Nasdaq National Market. Reports, proxy materials and other information concerning the Company can also be inspected and copied at the office of The Nasdaq Stock Market, 1735 K Street, N.W., Washington, D.C. 20006-1500. S-15 16 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents previously by the Company filed with the Commission pursuant to the Exchange Act are hereby incorporated by reference in this Prospectus Supplement: - The Company's Annual Report on Form 10-K for the year ended December 31, 1997; - The Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998; - The Company's Current Report on Form 8-K filed with the Commission on April 17, 1998; - The consolidated financial statements of Penn Advertising, Inc. and Subsidiary contained in the Company's Current Report on Form 8-K/A filed with the Commission on June 13, 1997; - The statement of assets acquired and liabilities assumed of National Advertising Company - Lamar Acquisition as of August 14, 1997, and the related statement of revenues and expenses for the years ended December 31, 1996 and 1995, contained in the Company's Current Report on Form 8-K/A filed with the Commission on October 27, 1997; and - The description of the Class A Stock contained in the Company's Registration Statement on Form 8-A, filed with the Commission on June 7, 1996, as amended by Form 8-A/A, filed with the Commission on July 31, 1996. All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus Supplement and prior to the termination of the offering made hereby shall be deemed to be incorporated by reference in this Prospectus Supplement and made a part hereof from the date of filing of such documents. Any statement contained in this Prospectus Supplement or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus Supplement to the extent that a statement contained herein or in any other document subsequently filed with the Commission which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus Supplement. The Company will provide without charge to each person to whom this Prospectus Supplement is delivered, upon request, a copy of any documents incorporated into this Prospectus Supplement by reference (other than exhibits incorporated by reference into such document). Requests for documents should be submitted to the executive offices of the Company, 5551 Corporate Boulevard, Baton Rouge, Louisiana 70808, Attention: Investor Relations, telephone (504) 926-1000. S-16 17 ========================================================= NO PERSON HAS BEEN AUTHORIZED IN CONNECTION WITH THE OFFERING MADE HEREBY TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR EITHER PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. NEITHER THIS PROSPECTUS SUPPLEMENT NOR EITHER PROSPECTUS CONSTITUTES AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY TO ANY PERSON OR BY ANYONE IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR EITHER PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF. --------------------- TABLE OF CONTENTS
PAGE ---- PROSPECTUS SUPPLEMENT The Company......................................... S-3 Recent Developments................................. S-4 The Offering........................................ S-6 Risk Factors........................................ S-6 Selected Consolidated Historical Financial and Operating Data.................................... S-7 Use of Proceeds..................................... S-8 Business............................................ S-9 Management.......................................... S-13 Underwriting........................................ S-14 Legal Matters....................................... S-15 Available Information............................... S-15 Incorporation of Certain Documents by Reference..... S-16 BASE PROSPECTUS Available Information............................... B-3 Incorporation of Certain Documents by Reference..... B-3 Note Regarding Forward-Looking Statements........... B-4 Risk Factors........................................ B-5 The Company......................................... B-9 Use of Proceeds..................................... B-10 Ratio of Earnings to Fixed Charges and Preferred Stock Dividends................................... B-10 General Description of Offered Securities........... B-10 Description of Debt Securities...................... B-10 Description of Preferred Stock...................... B-18 Description of Class A Stock........................ B-19 Description of Warrants............................. B-20 Plan of Distribution................................ B-22 Legal Matters....................................... B-23 Experts............................................. B-23 SELLING STOCKHOLDER PROSPECTUS The Company......................................... SS-2 Available Information............................... SS-2 Incorporation of Certain Documents by Reference..... SS-2 Risk Factors........................................ SS-3 Use of Proceeds..................................... SS-8 Selling Stockholders................................ SS-8 Plan of Distribution................................ SS-9 Legal Matters....................................... SS-9 Experts............................................. SS-9
========================================================= ========================================================= 6,375,000 SHARES LAMAR ADVERTISING COMPANY CLASS A COMMON STOCK [LAMAR LOGO] ------------------------------------------ PROSPECTUS SUPPLEMENT ------------------------------------------ BT ALEXS BROWN SALOMON SMITH BARNEY NATIONSBANC MONTGOMERY SECURITIES LLC PRUDENTIAL SECURITIES INCORPORATED DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION JUNE 5, 1998 ========================================================= -----END PRIVACY-ENHANCED MESSAGE-----