-----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, K/u0Qwt4XPcmlmriA66Z1l5MRXLxCrz7Uua+ImpqhogvBe8B/CL9JGS84Esb/678 b0CD44C2lCGxgIB17wWbIg== 0000950134-97-004900.txt : 19970626 0000950134-97-004900.hdr.sgml : 19970626 ACCESSION NUMBER: 0000950134-97-004900 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970618 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970625 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHANCELLOR BROADCASTING CO /DE/ CENTRAL INDEX KEY: 0001002909 STANDARD INDUSTRIAL CLASSIFICATION: RADIO BROADCASTING STATIONS [4832] IRS NUMBER: 752538487 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27726 FILM NUMBER: 97629774 BUSINESS ADDRESS: STREET 1: 12655 N CENTRAL EXPRESSWAY STREET 2: SUITE 405 CITY: DALLAS STATE: TX ZIP: 75243 BUSINESS PHONE: 9722396220 MAIL ADDRESS: STREET 1: 12655 N CENTRAL EXPRESSWAY STE 405 CITY: DALLAS STATE: TX ZIP: 75243 FORMER COMPANY: FORMER CONFORMED NAME: CHANCELLOR CORP/DE DATE OF NAME CHANGE: 19951031 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHANCELLOR RADIO BROADCASTING CO CENTRAL INDEX KEY: 0000925744 STANDARD INDUSTRIAL CLASSIFICATION: RADIO BROADCASTING STATIONS [4832] IRS NUMBER: 752544623 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 033-80534 FILM NUMBER: 97629775 BUSINESS ADDRESS: STREET 1: 12655 N CENTRAL EXPRESSWY STREET 2: STE 405 CITY: DALLAS STATE: TX ZIP: 75243 BUSINESS PHONE: 2142396220 MAIL ADDRESS: STREET 2: 12655 N CENTRAL EXPWY SUITE 405 CITY: DALLAS STATE: TX ZIP: 75243 FORMER COMPANY: FORMER CONFORMED NAME: CHANCELLOR BROADCASTING CO DATE OF NAME CHANGE: 19940621 8-K 1 FORM 8-K 1 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): June 18, 1997 CHANCELLOR BROADCASTING COMPANY (Exact name of registrant as specified in its charter) DELAWARE 0-27726 75-2538487 (State or other (Commission (IRS Employer jurisdiction of File Number) Identification incorporation) No.) CHANCELLOR RADIO BROADCASTING COMPANY (Exact name of registrant as specified in its charter) DELAWARE 333-80534 75-2544623 (State or other (Commission (IRS Employer jurisdiction of File Number) Identification incorporation) No.) 12655 NORTH CENTRAL EXPRESSWAY SUITE 405 DALLAS, TEXAS 75243 (Address of Principal Executive Offices) (Zip Code) Registrants' telephone number, including area code: (972) 239-6220 2 ITEM 5. OTHER EVENTS In connection with the offering by Chancellor Radio Broadcasting Company (the "Company") of $200,000,000 aggregate principal amount of its 8-3/4% Senior Subordinated Notes due 2007 referred to in the press release dated June 18, 1997 filed herewith as Exhibit 99.1 and incorporated herein by reference, the Company prepared a final offering memorandum that contained certain pro forma condensed statements of operations for the year ended December 31, 1996 and for the three months ended March 31, 1997, and a pro forma condensed balance sheet as of March 31, 1997. These pro forma condensed financial statements, which were prepared by the Company and therefore do not reflect the convertible preferred stock dividend requirements or other financial information relating to Chancellor Broadcasting Company ("Chancellor"), are set forth below. 3 The following unaudited pro forma condensed financial statements (the "Pro Forma Financial Statements") give effect to the Company's completed and pending acquisitions, dispositions, exchanges and financing transactions not previously reflected in the Company's historical financial statements. The Pro Forma Financial Statements and accompanying notes should be read in conjunction with the Company's historical financial statements. The Pro Forma Financial Statements are not necessarily indicative of either future results of operations or the results that might have occurred if the foregoing transactions had been consummated on the indicated dates. As used herein: (A) "Completed Chancellor Transactions" means (i) the acquisition by the Company on February 14, 1996 of Trefoil Communications, Inc. and its wholly-owned subsidiary, Shamrock Broadcasting, Inc., for approximately $408.0 million, (the "Shamrock Acquisition"), (ii) the sale by the Company on January 31, 1997 of WWWW-FM and WDFN-AM in Detroit to Evergreen Media Corporation ("Evergreen") for $30.0 million in cash (the "WWWW/WDFN Disposition"), (iii) the acquisition of KIMN-FM and KALC-FM in Denver, Colorado (acquired in exchange for KTBZ-FM in Houston, Texas and cash from Secret Communications, L.P.) (the "Houston/Denver Exchange"), (iv) the disposition of KTBZ-FM in Houston, Texas in connection with the Houston/Denver Exchange, (v) the acquisition by the Company on January 23, 1997 of Colfax Communications for approximately $383.7 million (the "Colfax Acquisition"), (vi) Colfax's prior acquisitions of KOOL-FM and the stations owned by Sundance Broadcasting, Inc., (vii) the sale of WMIL-FM and WOKY-AM in Milwaukee (which were acquired as part of the Colfax Acquisition) for $41.3 million in cash (the "Milwaukee Disposition"), (viii) the acquisition by the Company on February 13, 1997 of three FM stations in Orlando, two FM stations and one AM station in West Palm Beach and two FM stations in Jacksonville from OmniAmerica Group for $166.0 million in cash and common stock of Chancellor valued at $15.0 million (the "Omni Acquisition"), (ix) the exchange by the Company on March 28, 1997 of WEAT-FM/AM and WOLL-FM in West Palm Beach for KSTE-FM in Sacramento and $33.0 million in cash (the "West Palm Beach Exchange"), (x) the Company's offer for all outstanding 12 1/2% Notes, which was consummated on June 6, 1997 (the "Debt Tender Offer"), and (xi) the financing of each of the foregoing; (B) "Pending Chancellor Transactions" means (i) the pending exchange by the Company of WAPE-FM and WFYV-FM in Jacksonville and $11.0 million for WBAB-FM, WBLI-FM, WHFM-FM and WGBB-AM in Nassau-Suffolk (Long Island) (the "SFX Exchange"), (ii) the pending acquisition by the Company from Viacom of the subsidiaries of Viacom that own and operate KYSR-FM and KIBB-FM in Los Angeles, WLIT-FM in Chicago and WDRQ-FM in Detroit (the "Chancellor Viacom Acquisition") for approximately $480 million plus working capital, (iii) the pending sale by the Company of WDRQ-FM in Detroit to ABC for $37.0 million in cash (the "ABC/Detroit Disposition"), and (iv) the financing of each of the foregoing; (C) "Credit Agreement" means the Company's credit agreement entered into in connection with the Colfax Acquisition on January 23, 1997; and (D) "Restated Credit Agreement" means the Company's credit agreement, which is currently subject to negotiation with various lenders, proceeds of which will be used to refinance the Credit Agreement and in part, to complete the Chancellor Viacom Acquisition. The pro forma condensed statement of operations for the year ended December 31, 1996 and the three month period ended March 31, 1997 give effect to the consummation of the Completed Chancellor Transactions and the Pending Chancellor Transactions as if each such transaction had occurred on January 1, 1996. The pro forma condensed balance sheet at March 31, 1997 has been prepared as if any such transaction not yet consummated on that date had occurred on that date. The acquisitions referred to above were or will be accounted for using the purchase method of accounting with the total cost of the acquisitions and exchanges allocated to the tangible and intangible assets and liabilities acquired based upon their respective fair values. The allocation of the aggregate purchase prices reflected in the Pro Forma Financial Statements is preliminary. The final allocation of the purchase prices is contingent upon the receipt of final appraisals of the acquired assets and analysis of liabilities assumed; however, such allocations are not expected to differ materially from the preliminary amounts. THE PRO FORMA FINANCIAL STATEMENTS DO NOT GIVE EFFECT TO THE PENDING MERGER OF THE COMPANY WITH EVERGREEN AND ITS SUBSIDIARIES, CERTAIN ACQUISITIONS AND DISPOSITIONS BY EVERGREEN OR THE FINANCING THEREOF. EVERGREEN IS SUBJECT TO THE REPORTING REQUIREMENTS OF THE EXCHANGE ACT, AND ACCORDINGLY IS REQUIRED TO FILE PERIODIC AND OTHER REPORTS WITH THE SECURITIES AND EXCHANGE COMMISSION. 4 CHANCELLOR RADIO BROADCASTING COMPANY UNAUDITED PRO FORMA CONDENSED BALANCE SHEET AS OF MARCH 31, 1997 (DOLLARS IN THOUSANDS)
PRO FORMA PRO FORMA AS ADJUSTMENTS FOR AS ADJUSTED ADJUSTED FOR THE THE DEBT FOR THE PRO FORMA DEBT TENDER THE TENDER OFFER DEBT TENDER ADJUSTMENTS FOR OFFER, THE PENDING COMPANY AND THE OFFER THE PENDING TRANSACTIONS AND HISTORICAL OFFERING(1) AND THE OFFERING TRANSACTIONS(2) THE OFFERING ---------- ---------------- ---------------- --------------- ------------------ ASSETS: Current assets........................ $ 61,279 -- $ 61,279 $ 11,412(a) $ 72,691 Property and equipment, net........... 68,180 -- 68,180 6,030(a) 74,210 Intangible assets, net................ 978,094 -- 978,094 461,290(a) 1,439,384 Other assets.......................... 68,170 (1,550)(a) 72,620 (53,750)(a) 19,643 6,000(b) 773(b) ---------- -------- ---------- --------- ---------- Total assets.......................... $1,175,723 $ 4,450 $1,180,173 $ 425,755 $1,605,928 ========== ======== ========== ========= ========== LIABILITIES AND STOCKHOLDER'S EQUITY: Current portion of long-term debt..... $ 12,500 -- $ 12,500 $ (12,500)(c) $ -- Other current liabilities............. 23,693 -- 23,693 4,185(a) 27,878 ---------- -------- ---------- --------- ---------- Total current liabilities.... 36,193 -- 36,193 (8,315) 27,878 Long-term debt, excluding current portion............................. 524,121 200,000(b) 540,254 252,497(a) 808,751 (194,000)(b) 3,500(b) (60,000)(c) 12,500(c) 70,133(c) Deferred tax liabilities.............. 373 (620)(a) (4,300) (1,091)(b) (5,391) (4,053)(c) Other liabilities..................... 786 -- 786 -- 786 ---------- -------- ---------- --------- ---------- Total liabilities............ 561,473 11,460 572,933 259,091 832,024 Redeemable preferred stock............ 307,174 -- 307,174 -- 307,174 Stockholder's equity: Common Stock.......................... 1 -- 1 -- 1 Additional paid-in capital............ 332,901 -- 332,901 168,300(a) 501,201 Accumulated deficit................... (25,826) (930)(a) (32,836) (1,636)(b) (34,472) (6,080)(c) ---------- -------- ---------- --------- ---------- Total stockholder's equity... 307,076 (7,010) 300,066 166,664 466,730 ---------- -------- ---------- --------- ---------- Total liabilities and stockholder's equity.............................. $1,175,723 $ 4,450 $1,180,173 $ 425,755 $1,605,928 ========== ======== ========== ========= ==========
See accompanying Notes to Pro Forma Financial Statements 5 CHANCELLOR RADIO BROADCASTING COMPANY UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1996 (DOLLARS IN THOUSANDS)
AS ADJUSTED NET PRO FORMA FOR THE ADJUSTMENTS AS ADJUSTED COMPLETED FOR THE FOR THE TRANSACTIONS, COMPLETED COMPLETED PENDING PRO FORMA THE OFFERING THE TRANSACTIONS TRANSACTIONS CHANCELLOR ADJUSTMENTS FOR AND THE COMPANY AND THE AND THE TRANSACTIONS THE PENDING PENDING HISTORICAL OFFERING(3) OFFERING HISTORICAL(4) TRANSACTIONS TRANSACTIONS ---------- --------------- ------------ ------------- --------------- ------------- CONSOLIDATED STATEMENT OF OPERATIONS DATA: Gross Revenues................. $203,188 $ 73,271 $276,459 $57,789 $ (1,963)(5) $332,285 Less: Agency Commissions....... (24,787) (10,233) (35,020) (9,152) -- (44,172) -------- -------- -------- ------- -------- -------- Net Revenues................... 178,401 63,038 241,439 48,637 (1,963) 288,113 Station operating expenses excluding depreciation and amortization................. 111,210 40,633 151,843 24,562 (4,000)(5) 172,405 Depreciation and amortization................. 20,877 14,555 35,432 6,427 5,803(6) 47,662 Corporate general and administrative expenses...... 4,845 509 5,354 2,347 (1,807)(7) 5,894 Merger expense................. Stock option compensation...... 3,800 -- 3,800 -- -- 3,800 -------- -------- -------- ------- -------- -------- Operating income (loss)........ 37,669 7,341 45,010 15,301 (1,959) 58,352 Interest expense............... 35,704 12,165 47,869 6,374 16,857(8) 71,100 Other (income) expense......... 68 (216) (148) -- -- (148) -------- -------- -------- ------- -------- -------- Income (loss) before income taxes........................ 1,897 (4,608) (2,711) 8,927 (18,816) (12,600) Income tax expense (benefit)... 4,612 (1,696) 2,916 4,422 (8,378)(9) (1,040) -------- -------- -------- ------- -------- -------- Net income (loss) before extraordinary loss........... (2,715) (2,912) (5,627) 4,505 (10,438) (11,560) Preferred stock dividends and accretion.................... 11,557 26,843 38,400 -- -- 38,400 -------- -------- -------- ------- -------- -------- Net income (loss) attributable to common stock.............. $(14,272) $(29,755) $(44,027) $ 4,505 $(10,438) $(49,960) ======== ======== ======== ======= ======== ======== OTHER FINANCIAL DATA: Broadcast Cash Flow............ $ 67,191 $ 22,405 $ 89,596 $24,075 $ 2,037 $115,708 ======== ======== ======== ======= ======== ========
See accompanying Notes to the Pro Forma Financial Statements 6 CHANCELLOR RADIO BROADCASTING COMPANY UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 1997 (DOLLARS IN THOUSANDS)
AS ADJUSTED NET PRO FORMA FOR THE ADJUSTMENTS AS ADJUSTED COMPLETED FOR THE FOR THE TRANSACTIONS, COMPLETED COMPLETED PENDING PRO FORMA THE OFFERING THE TRANSACTIONS TRANSACTIONS CHANCELLOR ADJUSTMENTS FOR AND THE COMPANY AND THE AND THE TRANSACTIONS THE PENDING PENDING HISTORICAL OFFERING(3) OFFERING HISTORICAL(4) TRANSACTIONS TRANSACTIONS ---------- ------------- ------------ ------------- --------------- ------------- CONSOLIDATED STATEMENT OF OPERATIONS DATA: Gross Revenues................. $ 63,477 $2,355 $ 65,832 $11,867 $(1,070)(5) $ 76,629 Less: Agency Commissions....... (7,623) (384) (8,007) (1,960) -- (9,967) -------- ------ -------- ------- ------- -------- Net Revenues................... 55,854 1,971 57,825 9,907 (1,070) 66,662 Station operating expenses excluding depreciation and amortization................. 38,187 641 38,828 5,111 (1,541)(5) 42,398 Depreciation and amortization................. 8,109 753 8,862 1,078 1,526(6) 11,466 Corporate general and administrative expenses...... 1,712 -- 1,712 239 (176)(7) 1,775 Merger expense................. 2,056 -- 2,056 -- -- 2,056 Stock option compensation...... 950 -- 950 -- -- 950 -------- ------ -------- ------- ------- -------- Operating income (loss)........ 4,840 577 5,417 3,479 (879) 8,017 Interest (income) expense...... 11,420 497 11,917 1,594 4,214(8) 17,725 Other (income) expense......... (1,632) -- (1,632) -- -- (1,632) -------- ------ -------- ------- ------- -------- Income (loss) before income taxes........................ (4,948) 80 (4,868) 1,885 (5,093) (8,076) Income tax expense (benefit)... (400) (547) (947) 788 (2,071)(9) (2,230) -------- ------ -------- ------- ------- -------- Net income (loss) before extraordinary loss........... (4,548) 627 (3,921) 1,097 (3,022) (5,846) Preferred stock dividends and accretion.................... 8,135 1,504 9,639 -- -- 9,639 -------- ------ -------- ------- ------- -------- Net income (loss) attributable to common stock.............. $(12,683) $ (877) $(13,560) $ 1,097 $(3,022) $(15,485) ======== ====== ======== ======= ======= ======== OTHER FINANCIAL DATA: Broadcast Cash Flow............ $ 17,667 $1,330 $ 18,997 $ 4,796 $ 471 $ 24,264 ======== ====== ======== ======= ======= ========
See accompanying Notes to the Pro Forma Financial Statements 7 NOTES TO PRO FORMA FINANCIAL STATEMENTS (DOLLARS IN THOUSANDS) (1) PRO FORMA BALANCE SHEET -- COMPLETED TRANSACTIONS (a) Reflects an extraordinary charge of $930 (net of a tax benefit of $620) to write off the unamortized balance of deferred loan fees of $1,550 related to the Company's 12 1/2% Senior Subordinated Notes, which were redeemed in connection with the Debt Tender Offer. (b) Reflects the estimated proceeds of $194,000 from the issuance of $200,000 of 8 3/4% Senior Subordinated Notes (the "Offering") net of deferred loan fees of $6,000. The net proceeds will be used to reduce bank borrowings under the Credit Agreement. (c) Reflects an extraordinary charge of $6,080 for early call premiums and fees of $10,133 (less a tax benefit of $4,053) incurred in connection with the redemption of the Company's 12 1/2% Senior Subordinated Notes ($60,000 principal amount). The redemption was financed through additional borrowings of $70,133 under the Company's Credit Agreement. (2) PRO FORMA BALANCE SHEET -- PENDING TRANSACTIONS (a) Reflects the Pending Transactions as follows:
PURCHASE/ PROPERTY AND ASSETS DECREASE PENDING (SALES) CURRENT EQUIPMENT, HELD FOR INTANGIBLE CURRENT IN OTHER TRANSACTIONS PRICE ASSETS NET SALE ASSETS, NET LIABILITIES ASSETS ------------ --------- ------- ------------ -------- -------------- ----------- -------- WBAB-FM, WBLI-FM, WBGG-AM, WHFM-FM(i)... $ 11,000 $ -- $1,494 $ -- $ 9,506 $ -- $ -- Chancellor Viacom Acquisition(ii)....... 500,547 11,412 4,536 37,000 451,784 (4,185) 53,750 WDRQ-FM(iii)............................ (37,000) -- -- (37,000) -- -- -- -------- ------- ------ -------- -------- ------- ------- Total........................... $474,547 $11,412 $6,030 $ -- $461,290 $(4,185) $53,750 ======== ======= ====== ======== ======== ======= ======= INCREASE INCREASE IN (DECREASE) IN ADDITIONAL PENDING LONG-TERM PAID-IN TRANSACTIONS DEBT CAPITAL ------------ ------------- ----------- WBAB-FM, WBLI-FM, WBGG-AM, WHFM-FM(i)... $ 11,000 $ -- Chancellor Viacom Acquisition(ii)....... 278,497 168,300 WDRQ-FM(iii)............................ (37,000) -- -------- -------- Total........................... $252,497 $168,300 ======== ========
(i) On July 1, 1996, the Company entered into an agreement to exchange WAPE-FM and WFYV-FM in Jacksonville, Florida (which were acquired as part of the Omni Acquisition on February 13, 1997, see 3(d) below), and $11,000 in cash for WBAB-FM, WBLI-FM, WGBB-AM, and WHFM-FM in Long Island. The amounts allocated to net property and equipment and net intangible assets are based upon preliminary appraisals of the assets to be acquired. (ii) On February 19, 1997, the Company and Evergreen entered into the Viacom Joint Purchase Agreement whereby in the event the Viacom Acquisition occurs prior to the consummation of the Merger, the Company will be required to purchase 4 of the 10 Viacom stations in the Chancellor Viacom Acquisition for $480,000 plus working capital ($7,547 at March 31, 1997) and estimated acquisition costs of $13,000 for an aggregate purchase price of $500,547. The stations to be acquired by the Company include KYSR-FM and KIBB-FM in Los Angeles, WLIT-FM in Chicago and WDRQ-FM in Detroit. The assets of WDRQ-FM are classified as assets held for sale in connection with the purchase price allocation of the Chancellor Viacom Acquisition (see (iii) below). The Chancellor Viacom Acquisition will be financed through (i) additional bank borrowings of $278,497 under the Restated Credit Agreement (see (b) below); (ii) escrow funds of $53,750 paid by the Company on February 19, 1997 and classified as other assets at March 31, 1997, and (iii) the net proceeds of $168,300 from the Chancellor Interim Financing which will be contributed to the Company by Chancellor. Chancellor will ultimately be dependent upon dividends or other funds from the Company to meet this obligation including the payment of interest. The Company has assumed that historical balances of net property and equipment approximate fair value for the preliminary allocation of the purchase price and are based primarily on information provided by management of Viacom. 8 NOTES TO PRO FORMA FINANCIAL STATEMENTS -- (CONTINUED) (iii) On April 11, 1997, the Company entered into an agreement to sell WDRQ-FM in Detroit (to be acquired as part of the Chancellor Viacom Acquisition) for $37,000 in cash. The assets of WDRQ-FM are classified as assets held for sale in connection with the purchase price allocation of the Chancellor Viacom Acquisition and no gain or loss will be recognized in connection with the sale. (b) Reflects (i) the adjustment to write off the unamortized balance of deferred loan fees of $1,636 (net of a tax benefit of $1,091) at March 31, 1997 related to the Credit Agreement as an extraordinary item and (ii) the adjustment to record estimated new loan fees of $3,500 to be incurred in connection with the Company's Restated Credit Agreement and financed through additional bank borrowings under such agreement. The refinancing of the Credit Agreement was financed through borrowings under the Restated Credit Agreement. (c) In connection with the Chancellor Viacom Acquisition, the Company will refinance the Credit Agreement with the Restated Credit Agreement. The Restated Credit Agreement is expected to provide for a $400,000 term loan facility and a $350,000 revolving loan facility. Reflects the $12,500 adjustment to decrease current maturities of long-term debt under the Restated Credit Agreement to $0. 9 ADJUSTMENTS TO HISTORICAL CONDENSED STATEMENT OF OPERATIONS RELATED TO THE COMPLETED CHANCELLOR TRANSACTIONS (3) The Completed Chancellor Transactions historical condensed statement of operations for the year ended December 31, 1996 and the three month period ended March 31, 1997 and pro forma adjustments related to the Completed Chancellor Transactions are summarized below:
ACQUISITIONS ----------------------------------------------------------------------------------------------- KIMN-FM/ KOOL-FM KSTE-FM SHAMROCK KALC-FM COLFAX HISTORICAL SUNDANCE OMNI HISTORICAL COMPLETED CHANCELLOR TRANSACTIONS HISTORICAL HISTORICAL HISTORICAL 1/1- HISTORICAL HISTORICAL 1/1- YEAR ENDED DECEMBER 31, 1996(a) 1/1-2/14(b) 1/1-12/31(c) 1/1-12/31(d) 3/31(d) 1/1-9/12(d) 1/1-6/30(e) 7/31(f) - --------------------------------- ----------- ------------ ------------ ---------- ----------- ----------- ---------- Gross revenues..................... $ 9,698 $2,010 $51,745 $1,665 $13,844 $8,710 $1,411 Less: agency commissions........... (1,234) (259) (6,626) (234) (1,740) (1,211) (149) ------- ------ ------- ------- ------- ------ ------ Net revenues....................... 8,464 1,751 45,119 1,431 12,104 7,499 1,262 Station operating expenses excluding depreciation and amortization..................... 7,762 1,523 28,584 852 7,678 4,985 1,244 Depreciation and amortization...... 595 511 4,494 229 1,242 1,458 375 Corporate general and administrative expenses.......... 2,215 -- -- -- -- -- -- ------- ------ ------- ------- ------- ------ ------ Operating income (loss)............ (2,108) (283) 12,041 350 3,184 1,056 (357) Interest expense................... 1,380 -- 4,369 299 -- -- -- Other (income) expense............. 49 312 (179) -- 25 (404) -- ------- ------ ------- ------- ------- ------ ------ Income (loss) before income taxes............................ (3,537) (595) 7,851 51 3,159 1,460 (357) Income tax expense (benefit)....... -- -- -- -- -- -- -- ------- ------ ------- ------- ------- ------ ------ Net income (loss) before extraordinary loss............... (3,537) (595) 7,851 51 3,159 1,460 (357) Preferred stock dividends and accretion........................ -- -- -- -- -- -- -- ------- ------ ------- ------- ------- ------ ------ Net income (loss) attributable to common stock..................... $(3,537) $ (595) $ 7,851 $ 51 $ 3,159 $1,460 $ (357) ======= ====== ======= ======= ======= ====== ====== OTHER FINANCIAL DATA: Broadcast Cash Flow................ $ 702 $ 228 $16,535 $ 579 $ 4,426 $2,514 $ 18 DISPOSITIONS ---------------------------------------- NET WMIL-FM/ PRO FORMA PRO FORMA WWWW-FM/ KTBZ-FM WOKY-AM ADJUSTMENTS ADJUSTMENTS WDFN-AM HISTORICAL HISTORICAL FOR THE FOR THE COMPLETED CHANCELLOR TRANSACTIONS HISTORICAL 1/1- 1/1- COMPLETED COMPLETED YEAR ENDED DECEMBER 31, 1996(a) 1/1-2/14(g) 2/14(c) 12/31(h) TRANSACTIONS TRANSACTIONS - --------------------------------- ----------- ----------- ------------ ------------ ------------- Gross revenues..................... $(839) $ (399) $(9,552) $ (5,022)(i) $ 73,271 Less: agency commissions........... 102 48 1,070 -- (10,233) ----- ------- ------- -------- -------- Net revenues....................... (737) (351) (8,482) (5,022) 63,038 Station operating expenses excluding depreciation and amortization..................... (815) (521) (4,896) (5,763)(i) 40,633 Depreciation and amortization...... (45) (42) (539) 7,831(j) 14,555 (1,554)(k) Corporate general and administrative expenses.......... -- -- -- (1,706)(l) 509 ----- ------- ------- -------- -------- Operating income (loss)............ 123 212 (3,047) (3,830) 7,341 Interest expense................... -- -- -- 6,117(m) 12,165 Other (income) expense............. -- -- (19) -- (216) ----- ------- ------- -------- -------- Income (loss) before income taxes............................ 123 212 (3,028) (9,947) (4,608) Income tax expense (benefit)....... -- -- -- (1,696)(n) (1,696) ----- ------- ------- -------- -------- Net income (loss) before extraordinary loss............... 123 212 (3,028) (8,251) (2,912) Preferred stock dividends and accretion........................ -- -- -- 26,843(o) 26,843 ----- ------- ------- -------- -------- Net income (loss) attributable to common stock..................... $ 123 $ 212 $(3,028) $(35,094) $(29,755) ===== ======= ======= ======== ======== OTHER FINANCIAL DATA: Broadcast Cash Flow................ $ 78 $ 170 $(3,586) $ 741 $ 22,405
10
NET PRO FORMA ADJUSTMENTS ADJUSTMENTS COLFAX FOR THE FOR THE COMPLETED CHANCELLOR TRANSACTIONS HISTORICAL COMPLETED COMPLETED THREE MONTHS ENDED MARCH 31, 1997(a) 1/1 - 1/23(d) TRANSACTIONS TRANSACTIONS ------------------------------------ --------------- ------------ ------------ Gross revenues.......................... $3,183 $ (828)(i) $2,355 Less: agency commissions................ (384) -- (384) ------ ------- ------ Net revenues............................ 2,799 (828) 1,971 Station operating expenses excluding depreciation and amortization......... 1,872 (1,231)(i) 641 Depreciation and amortization........... -- 835(j) 753 (82)(k) ------ ------- ------ Operating income (loss)................. 927 (350) 577 Interest (income) expense............... -- 497(m) 497 ------ ------- ------ Income (loss) before income taxes....... 927 (847) 80 Income tax expense (benefit)............ -- (547)(n) (547) ------ ------- ------ Net income (loss) before extraordinary loss.................................. 927 (300) 627 Preferred stock dividends and accretion............................. -- 1,504(o) 1,504 ------ ------- ------ Net income (loss) attributable to common stock................................. $ 927 $(1,804) $ (877) ====== ======= ====== OTHER FINANCIAL DATA: Broadcast Cash Flow..................... $ 927 $ 403 $1,330 ====== ======= ======
- --------------- (a) On November 22, 1996, the Company acquired WKYN-AM in Cincinnati for $1,400 in cash. The Company had been previously operating WKYN-AM under a time brokerage agreement since January 1, 1996. Therefore, the Company's historical results of operations for the year ended December 31, 1996 and the three months ended March 31, 1997 include the results of operations of WKYN-AM. (b) On February 14, 1996, the Company acquired Shamrock Broadcasting, Inc., a radio broadcasting company with 19 radio stations (11 FM and 8 AM) located in 10 markets (Los Angeles, New York, San Francisco, Houston, Atlanta, Detroit, Denver, Minneapolis-St. Paul, Phoenix and Pittsburgh). The total purchase price, including acquisition costs, allocated to net assets acquired was approximately $408,000. (c) On July 31, 1996, the Company exchanged KTBZ-FM in Houston (which was acquired on February 14, 1996 as part of the Shamrock Acquisition) and $5,600 in cash for KIMN-FM and KALC-FM in Denver. The Company had previously entered into a time brokerage agreement to sell substantially all of the broadcast time of KTBZ-FM effective February 14, 1996. In addition, the Company had been previously operating KIMN-FM and KALC-FM under a time brokerage agreement since April 1, 1996. (d) On January 23, 1997, the Company acquired Colfax Communications, a radio broadcasting company, with 12 radio stations (8 FM and 4 AM) located in 4 markets (Minneapolis-St. Paul, Phoenix, Washington, D.C. and Milwaukee markets). The total purchase price, including acquisition costs, allocated to net assets acquired was approximately $383,700. The Colfax Acquisition was financed through (i) a private placement by the Company of $200,000 of 12% Preferred Stock for net proceeds of $191,817; (ii) a private placement by Chancellor of $110,000 of 7% Convertible Preferred Stock for net proceeds of $105,546; (iii) additional bank borrowings under the Company's Credit Agreement of $65,937 and (iv) $20,400 in escrow funds. The historical financial data of Colfax for the year ended December 31, 1996 excludes the combined net income of approximately $224 for KLTB-FM, KARO-FM and KIDO-AM in Boise, Idaho which the Company did not acquire as part of the Colfax Acquisition. The Colfax historical condensed statement of operations for the year ended December 31, 1996, does not include the results of operations of the following: (i) KOOL-FM for the period January 1, 1996 to March 31, 1996 and (ii) WMIL-FM and WOKY-AM in Milwaukee and KZON-FM, KISO-AM, KYOT-FM and KOY-AM in Phoenix which were owned and operated by Sundance Broadcasting, Inc. ("Sundance") for the period January 1, 1996 to September 12, 1996. On March 31, 1997, the Company sold WMIL-FM and WOKY-AM in Milwaukee for $41,253 in cash. The assets of WMIL-FM and WOKY-AM are classified as assets held for sale in connection with the purchase price allocation of the Colfax Acquisition. Accordingly, WMIL-FM and WOKY-AM net income 11 of approximately $41 for the period January 23, 1997 through March 31, 1997 has been excluded from the Colfax historical condensed statement of operations for the three months ended March 31, 1997. (e) On February 13, 1997, the Company acquired substantially all of the assets and assumed certain liabilities of the OmniAmerica Group including 8 radio stations (7 FM and 1 AM) located in 3 markets (Orlando, West Palm Beach and Jacksonville). The total purchase price, including acquisition costs, allocated to net assets acquired was approximately $181,046. The Omni Acquisition was financed through (i) additional bank borrowings under the Credit Agreement of $166,046 and (ii) the issuance of 555,556 shares of the Chancellor Class A Common Stock valued at $15,000 or $27.00 per share which was contributed to the Company by Chancellor. Prior to the consummation of the Omni Acquisition, the Company had entered into an agreement to operate the stations under a time brokerage agreement effective July 1, 1996. Additionally, prior to consummation of the West Palm Beach Exchange (see (f) below) on March 28, 1997 and the SFX Exchange (see note 4(a)), the Company entered into time brokerage agreements to sell substantially all of the broadcast time of WEAT-FM/AM and WOLL-FM in West Palm Beach and WAPE-FM and WFYV-FM in Jacksonville effective July 1, 1996. The historical financial data of Omni for the period January 1, 1996 to June 30, 1996 represents the results of operations for the Orlando stations (WOMX-FM, WXXL-FM and WJHM-FM). The results of operations for WEAT-FM/AM and WOLL-FM in West Palm Beach and WAPE-FM and WFYV-FM in Jacksonville are not included as the acquisition and disposition of these stations is deemed to have occurred on January 1, 1996. (f) On March 28, 1997, the Company exchanged, in the West Palm Beach Exchange, WEAT-FM/AM and WOLL-FM in West Palm Beach, Florida, which were acquired as part of the Omni Acquisition, for KSTE-FM in Sacramento and $33,000 in cash. The Company had previously been operating KSTE-FM under a time brokerage agreement since August 1, 1996. (g) On January 31, 1997, the Company sold, in the WWWW/WDFN Disposition, WWWW-FM and WDFN-AM in Detroit, which were acquired on February 14, 1996 as part of the Shamrock Acquisition, to Evergreen for $30,000 in cash. Prior to the completion of the sale, the Company had entered into a joint sales agreement effective February 14, 1996 and a time brokerage agreement effective April 1, 1996 to sell substantially all of the broadcast time of WWWW-FM and WDFN-AM to Evergreen pending the completion of the sale. (h) On March 31, 1997, the Company sold, in the Milwaukee Disposition, WMIL-FM and WOKY-AM in Milwaukee, which were acquired as part of the Colfax Acquisition on January 23, 1997, for $41,253 in cash. (i) Reflects the elimination of time brokerage agreement fees received and paid by the Company as follows:
COMPLETED CHANCELLOR TRANSACTIONS YEAR ENDED DECEMBER 31, 1996 MARKET PERIOD REVENUE EXPENSE --------------------------------- --------------- ---------- ------- ------- WWWW-FM/WDFN-AM........................... Detroit 2/14-12/31 $(2,937) $ (598) KTBZ-FM................................... Houston 2/14-7/31 (1,113) (265) WOMX-FM, WXXL-FM, WJHM-FM................. Orlando 7/1-12/31 -- (3,900) WEAT-FM/AM, WOLL-FM....................... West Palm Beach 7/1-12/31 (972) (1,000) ------- ------- Total adjustment for decrease in gross revenues and expenses........... $(5,022) $(5,763) ======= =======
COMPLETED CHANCELLOR TRANSACTIONS THREE MONTHS ENDED MARCH 31, 1997 MARKET PERIOD REVENUE EXPENSE --------------------------------- --------------- -------- ------- ------- WWWW-FM/WDFN-AM.............................. Detroit 1/1-1/31 $(235) $ (16) WOMX-FM, WXXL-FM, WJHM-FM.................... Orlando 1/1-2/13 -- (911) WEAT-FM/AM, WOLL-FM.......................... West Palm Beach 1/1-3/28 (593) (304) ----- ------- Total adjustment for decrease in gross revenues and expenses............ $(828) $(1,231) ===== =======
Gross revenues of the Completed Chancellor Transactions exclude any time brokerage agreement payments received from the Company. 12 (j) Reflects incremental amortization related to the Completed Chancellor Transactions and is based on the following allocation to intangible assets:
INCREMENTAL HISTORICAL ADJUSTMENT COMPLETED CHANCELLOR TRANSACTIONS AMORTIZATION INTANGIBLE AMORTIZATION AMORTIZATION FOR NET YEAR ENDED DECEMBER 31, 1996 PERIOD ASSETS, NET EXPENSE(i) EXPENSE INCREASE --------------------------------- ------------ ----------- ------------ ------------ ---------- Shamrock............................ 1/1-2/14 $361,425 $ 1,104 $ 393 $ 711 KIMN-FM/KALC-FM..................... 1/1-3/31 8,285 52 341 (289) Omni................................ 1/1-12/31 171,837 4,296 161 4,135 Colfax.............................. 1/1-12/31 317,894 7,947 3,861 4,086 KSTE-FM............................. 1/1-12/31 (32,475) (812) -- (812) -------- ------- ------ ------ Total............................................. $826,966 $12,587 $4,756 $7,831 ======== ======= ====== ======
INCREMENTAL HISTORICAL ADJUSTMENT COMPLETED CHANCELLOR TRANSACTIONS AMORTIZATION INTANGIBLE AMORTIZATION AMORTIZATION FOR NET THREE MONTHS ENDED MARCH 31, 1997 PERIOD ASSETS, NET EXPENSE(i) EXPENSE INCREASE --------------------------------- ------------ ----------- ------------ ------------ ---------- Omni................................ 1/1-2/13 $171,837 $ 525 $ -- $ 525 Colfax.............................. 1/1-1/23 317,894 508 -- 508 KSTE-FM............................. 1/1-3/28 (32,475) (198) -- (198) -------- ----- ------ ----- Total............................... $457,256 $ 835 $ -- $ 835 ======== ===== ====== =====
- --------------- (i) Intangible assets are amortized on a straight-line basis over an estimated average 40 year life by the Company. Historical depreciation expense of the Completed Chancellor Transactions is assumed to approximate depreciation expense on a pro forma basis. Actual depreciation and amortization may differ based upon final purchase price allocations. (k) Reflects the elimination of disposed stations' historical depreciation and amortization expense of $1,554 for the year ended December 31, 1996 (KTBZ-FM of $642 and WWWW-FM/WDFN-AM of $912 for the period of February 14, 1996 to December 31, 1996) and $82 for the three months ended March 31, 1997 (WWWW-FM/WDFN-AM for the period of January 1, 1997 to January 31, 1997) recognized by the Company during the time brokerage agreement holding period. (l) Reflects the elimination of estimated duplicate corporate expenses of $1,706 for the year ended December 31, 1996 related to the Completed Chancellor Transactions. (m) Reflects the adjustment to interest expense in connection with the consummation of the Completed Chancellor Transactions, the February 1996 and August 1996 equity offerings of Chancellor, the issuance of 13 the Company's 12 1/4% Preferred Stock, the refinancing of the Company's former credit agreement on January 23, 1997 and the Offering:
THREE MONTHS YEAR ENDED ENDED DECEMBER 31, 1996 MARCH 31, 1997 ----------------- -------------- Additional bank borrowings related to: Completed Acquisitions.............................. $ 667,383 $ 231,983 Completed Dispositions.............................. (104,253) (104,253) New Loan Fees....................................... 2,874 2,874 --------- --------- Total additional bank borrowings...................... $ 566,004 $ 130,604 ========= ========= Interest expense at 7.5%.............................. $ 14,834 $ 320 Less: historical interest expense of the stations acquired in the Completed Transactions.............. (6,048) -- --------- --------- Net increase in interest expense...................... 8,786 320 Reduction in interest expense resulting from the redemption of the Company's 12 1/2% Senior Subordinated Notes of $60,000....................... (7,500) (1,875) Interest expense on $70,133 additional bank borrowings at 7.5% related to the redemption of the Company's 12 1/2% Senior Subordinated Notes................... 5,260 1,315 Reduction in interest expense on bank debt related to the application of net proceeds of the following: February 1996 Offering proceeds of $155,475 for the period January 1, 1996 to February 14, 1996 at 7.5%............................................. (1,425) -- August 1996 Offering proceeds of $23,050 for the period January 1, 1996 to August 9, 1996 at 7.5%............................................. (1,052) -- 12 1/4% Preferred Stock proceeds of $96,171 for the period January 1, 1996 to February 14, 1996 at 7.5%............................................. (902) -- Interest expense on $200,000 8 3/4% Senior Subordinated Notes related to the Offering.......... 17,500 4,375 Reduction in interest expense resulting from the $194,000 decrease in bank borrowings at 7.5%related to the Offering..................................... (14,550) (3,638) --------- --------- Total adjustment for net increase in interest expense............................................. $ 6,117 $ 497 ========= =========
(n) Reflects the income tax benefit related to pro forma adjustments. The adjustment to income taxes reflects the application of the estimated effective tax rate on a pro forma basis to income (loss) before income taxes for historical and pro forma adjustment amounts. (o) Reflects incremental dividends and accretion on preferred stock of subsidiaries as follows:
THREE MONTHS DATE OF YEAR ENDED ENDED ISSUANCE DECEMBER 31, 1996 MARCH 31, 1997 ----------------- ----------------- -------------- 12 1/4% Preferred Stock................. February 26, 1996 $ 1,441 $ -- 12% Preferred Stock..................... January 23, 1997 25,402 1,504 ------- ------ Total dividends and accretion........... $26,843 $1,504 ======= ======
14 ADJUSTMENTS TO UNAUDITED PRO FORMA CONDENSED STATEMENTS OF OPERATIONS RELATED TO THE PENDING CHANCELLOR TRANSACTIONS (4) The detail of the historical financial data of the stations to be acquired in the Pending Chancellor Transactions for the year ended December 31, 1996 the three month period ended March 31, 1997 has been obtained from the historical financial statements of the respective companies and is summarized below:
YEAR ENDED DECEMBER 31, 1996 THREE MONTHS ENDED ----------------------------------------- MARCH 31, 1997 WBAB-FM ------------------ WBLI-FM CHANCELLOR CHANCELLOR WGBB-AM VIACOM PENDING VIACOM WHFM-FM ACQUISITION CHANCELLOR ACQUISITION HISTORICAL HISTORICAL TRANSACTIONS HISTORICAL PENDING CHANCELLOR TRANSACTIONS 1/1-6/30(a) 1/1-12/31(b) HISTORICAL 1/1-3/31(b) - --------------------------------------- ----------- ------------ ------------ ------------------ Gross revenues......................... $5,726 $52,063 $57,789 $11,867 Less: agency commissions............... (619) (8,533) (9,152) (1,960) ------- ------- ------- ------- Net revenues........................... 5,107 43,530 48,637 9,907 Station operating expenses excluding depreciation and amortization........ 3,676 20,886 24,562 5,111 Depreciation and amortization.......... 2,141 4,286 6,427 1,078 Corporate general and administrative expenses............................. 1,024 1,323 2,347 239 ------- ------- ------- ------- Operating income (loss)................ (1,734) 17,035 15,301 3,479 Interest expense....................... -- 6,374 6,374 1,594 ------- ------- ------- ------- Income (loss) before income taxes...... (1,734) 10,661 8,927 1,885 Income tax expense..................... -- 4,422 4,422 788 ------- ------- ------- ------- Net income (loss)...................... $(1,734) $ 6,239 $ 4,505 $ 1,097 ======= ======= ======= ======= OTHER FINANCIAL DATA:.................. Broadcast Cash Flow.................... $1,431 $22,644 $24,075 $ 4,796
- --------------- (a) On July 1, 1996, the Company entered into an agreement to exchange, in the SFX Exchange, WAPE-FM and WFYV-FM in Jacksonville, Florida (which were acquired as part of the Omni Acquisition) (see note 3(e)), and $11,000 in cash for WBAB-FM, WBLI-FM, WGBB-AM, and WHFM-FM in Long Island. (b) On February 19, 1997, the Company and Evergreen entered into the Viacom Joint Purchase Agreement whereby in the event the Viacom Acquisition occurs prior to the consummation of the Chancellor Merger, the Company will be required to purchase 4 of the 10 Viacom stations in the Chancellor Viacom Acquisition for $480,000 plus working capital ($7,547 at March 31, 1997) and estimated acquisition costs of $13,000 for an aggregate purchase price of $500,547. The stations to be acquired by the Company in the Chancellor Viacom Acquisition include KYSR-FM and KIBB-FM in Los Angeles, WLIT-FM in Chicago and WDRQ-FM in Detroit. On April 14, 1997, the Company entered into an agreement to sell WDRQ-FM in Detroit (to be acquired as part of the Chancellor Viacom Acquisition) for $37,000 in cash; consequently, only the results of operations of the Viacom Stations in Los Angeles and Chicago have been given effect in the Pro Forma Financial Statements. (5) Reflects the elimination of time brokerage agreement fees received and paid by the Company as follows:
PENDING CHANCELLOR TRANSACTIONS YEAR ENDED DECEMBER 31, 1996 MARKET PERIOD REVENUE EXPENSE ------------------------------- ----------- --------- ------- ------- WAPE-FM, WFYV-FM............................................ Jacksonville 7/1-12/31 $(1,963) $(2,000) WBAB-FM, WBLI-FM, WGBB-AM, WHFM-FM.......................... Long Island 7/1-12/31 -- (2,000) ------- ------- Total adjustment for decrease in gross revenues and expenses........................ $(1,963) $(4,000) ======= =======
15
PENDING CHANCELLOR TRANSACTIONS THREE MONTHS ENDED MARCH 31, 1997 MARKET PERIOD REVENUE EXPENSE --------------------------------- ----------- --------- ------- ------- WAPE-FM, WFYV-FM............................................ Jacksonville 1/1-3/31 $(1,070) $ (541) WBAB-FM, WBLI-FM, WGBB-AM, WHFM-FM.......................... Long Island 1/1-3/31 -- (1,000) ------- ------- Total adjustment for decrease in gross revenues and expenses........................ $(1,070) $(1,541) ======= =======
(6) Reflects incremental amortization related to the Pending Chancellor Transactions and is based on the allocation of the total consideration as follows:
YEAR ENDED THREE MONTHS ENDED DECEMBER 31, 1996 MARCH 31, 1997 ----------------- ------------------ Amortization expense on $461,290 additional intangible assets amortized on a straight-line basis over a period of 40 years............... $11,533 $ 2,883 Less: Historical amortization expense........... (5,730) (1,357) ------- ------- Adjustment for net increase in amortization expense....................................... $ 5,803 $ 1,526 ======= =======
Historical depreciation expense, of the Pending Chancellor Transactions, is assumed to approximate depreciation expense on a pro forma basis. Actual depreciation and amortization may differ based upon final purchase price allocations. (7) Reflects the elimination of estimated duplicate corporate expenses of $1,807 for the year ended December 31, 1996 and $176 for the three months ended March 31, 1997 related to the Pending Chancellor Transactions. (8) Reflects the adjustment to interest expense in connection with the consummation of the Pending Chancellor Transactions and the refinancing of the Company's bank borrowings under the Restated Credit Agreement:
YEAR ENDED THREE MONTHS ENDED DECEMBER 31, 1996 MARCH 31, 1997 ----------------- ------------------ Additional bank borrowings related to: Pending Acquisitions.......................... $343,247 $343,247 Pending Dispositions.......................... (37,000) (37,000) Loan Fees..................................... 3,500 3,500 -------- -------- Total additional bank borrowings................ $309,747 $309,747 ======== ======== Interest expense on additional bank borrowings at 7.5%....................................... $ 23,231 $ 5,808 Less: historical interest expense of the stations being acquired in the Pending Chancellor Transactions....................... (6,374) (1,594) -------- -------- Net increase in interest expense................ $ 16,857 $ 4,214 ======== ========
(9) Reflects the income tax benefit related to pro forma adjustments. The adjustment to income taxes reflects the application of the estimated effective tax rate on a pro forma basis to income (loss) before income taxes for historical and pro forma adjustment amounts. 16 ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (c) Exhibits 99.1 Press release dated June 18, 1997. 17 Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. CHANCELLOR BROADCASTING COMPANY Date: June 25, 1997 By: /s/ JACQUES D. KERREST ------------------------------------- Jacques D. Kerrest Senior Vice President and Chief Financial Officer CHANCELLOR RADIO BROADCASTING COMPANY Date: June 25, 1997 By: /s/ JACQUES D. KERREST ------------------------------------- Jacques D. Kerrest Senior Vice President and Chief Financial Officer 18 INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 99.1 Press release dated June 18, 1997.
EX-99.1 2 PRESS RELEASE 1 EXHIBIT 99.1 ================================================================================ CHANCELLOR BROADCASTING COMPANY ================================================================================ 12655 N. CENTRAL EXPRESSWAY, SUITE 105 DALLAS, TEXAS 79243-6354 (214) 239-6220 FAX (214) 239-0220 FOR IMMEDIATE RELEASE - --------------------- CHANCELLOR BROADCASTING COMPANY ANNOUNCES DEBT PLACEMENT BY SUBSIDIARY DALLAS, TX, June 18, 1997 -- Chancellor Broadcasting Company (Nasdaq: CBCA) announced today that its subsidiary, Chancellor Radio Broadcasting Company, has agreed to sell $200,000,000 of 8-3/4% Senior Subordinated Notes due 2007 in a private placement transaction. The Notes will be sold at a discount and will have a yield to maturity of 8.92% per annum. Chancellor said that the net proceeds of the offering will be used to repay term debt outstanding under Chancellor Radio Broadcasting's bank credit facility. The offering is expected to close on June 24, 1997. The Notes will not be and have not been registered under the Securities Act of 1933, as amended, or any state securities or blue sky laws and may not be offered or sold in the United States absent registration or an exemption from the registration requirements of such laws. Chancellor Broadcasting was formed in 1993 by Steven Dinetz and Hicks, Muse, Tate & Furst to pursue acquisitions in the radio broadcast industry. Chancellor Broadcasting is one of the leading pure-play radio broadcasting companies in the United States. Upon consummation of all pending acquisitions, excluding the previously announced merger with Evergreen Media and acquisition of four radio properties from Viacom International, Chancellor will own and operate 51 stations in 14 markets. Chancellor Media Corporation, the nation's largest pure-play radio broadcasting company, is being formed by the merger of Chancellor Broadcasting Company with Evergreen Media Corporation (Nasdaq:EVGM) and the acquisition of ten radio properties owned by Viacom International (AMEX: VIA, VIAB). Upon consummation of all announced transactions, Chancellor Media will own and operate 96 radio stations in 21 of the nations 40 largest markets. For more information, please contact: Chancellor Broadcasting: Steve Dinetz 972-239-6220 Jacques Kerrest Brainerd Communicators: Chris Plunkett 212-986-6667 John Buckley
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