UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September 30, 2017~~March 31, 2019

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number:001-14461

Entercom Communications Corp.

(Exact name of registrant as specified in its charter)

Pennsylvania

23-1701044

(State or other jurisdiction of

incorporation or organization)

(I.R.S. employer

identification no.)

401 E. City Avenue, Suite 809

Bala Cynwyd, Pennsylvania 19004

(Address of principal executive offices and zip code)

(610)660-5610

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of RegulationS-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act and Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule12b-2 of the Exchange Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange

on which registered

Class A Common Stock,

par value $.01 per share

ETM

New York Stock Exchange

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class A common stock, $0.01 par value – ~~33,532,404~~138,563,358 Shares Outstanding as of ~~October 27, 2017~~April 30, 2019

(Class A Shares Outstanding include ~~1,773,121~~4,144,421 unvested and vested but deferred restricted stock units)

Class B common stock, $0.01 par value – ~~7,197,532~~4,045,199 Shares Outstanding as of ~~October 27, 2017.~~April 30, 2019.

ENTERCOM COMMUNICATIONS CORP.

INDEX


Part I Financial Information

	Item 1.		Financial Statements		12
	Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		3336
	Item 3.		Quantitative and Qualitative Disclosures About Market Risk		44
	Item 4.		Controls and Procedures		44

Part II Other Information

	Item 1.		Legal Proceedings		4546
	Item 1A.		Risk Factors		4546
	Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds		45
~~Item 3. Defaults Upon Senior Securities~~		45
~~Item 4. Mine Safety Disclosures~~		45
~~Item 5. Other Information~~		45
~~Item 6. Exhibits~~		46

Item 3.	~~Signatures~~Defaults Upon Senior Securities			4846
	Item 4.		Mine Safety Disclosures		46
	Item 5.		Other Information		46
	Item 6.		Exhibits		47

~~Exhibit Index~~Signatures					49

Private Securities Litigation Reform Act Safe Harbor Statement

In addition to historical information, this report contains statements by us with regard to our expectations as to financial results and other aspects of our business that involve risks and uncertainties and may constitute forward- looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.

Forward-looking statements are presented for illustrative purposes only and reflect our current expectations concerning future results and events. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, without limitation, any projections of earnings, revenues or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing.

You can identify forward-looking statements by our use of words such as “anticipates,” “believes,” “continues,” “expects,” “intends,” “likely,” “may,” “opportunity,” “plans,” “potential,” “project,” “will,” “could,” “would,” “should,” “seeks,” “estimates,” “predicts” and similar expressions which identify forward-looking statements, whether in the negative or the affirmative. We cannot guarantee that we actually will achieve these plans, intentions or expectations. These forward-looking statements are subject to risks, uncertainties and other factors, some of which are beyond our control, which could cause actual results to differ materially from those forecasted or anticipated in such forward-looking statements. You should not place undue reliance on these forward-looking statements, which reflect our view only as of the date of this report. We undertake no obligation to update these statements or publicly release the result of any revision(s) to these statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events.

Key risks to our company are described in our Annual Report on Form10-K filed with the Securities and Exchange Commission (the “SEC”) on February ~~28, 2017,~~27, 2019, and as may be supplemented by the risks described under Part II, Item 1A, of our quarterly reports on Form10-Q and in our Current Reports on Form 8-K, on Form S-4 filed with the SEC on April 12, 2017, and on Forms S-4/A filed with the SEC on May 30, 2017, July 10, 2017, August 24, 2017, October 10, 2017, October 16, 2017, and October 19, 2017.8-K.

PART I

FINANCIAL INFORMATION

ITEM 1. Financial Statements

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

(unaudited)


	SEPTEMBER 30,			DECEMBER 31,
	2017			2016			MARCH 31, 2019			DECEMBER 31, 2018
ASSETS:
Cash	$	5,386		$	46,843		$	68,266		$	122,893
Restricted cash								—			69,365
Accounts receivable, net of allowance for doubtful accounts		92,343			92,172			269,945			342,766
Prepaid expenses, deposits and other		9,504			7,670			33,840			25,205

Total current assets		107,233			146,685			372,051			560,229
Investments								11,205			11,205
Net property and equipment		67,432			63,375			327,901			317,030
Operating leaseright-of-use assets								293,638			—
Radio broadcasting licenses		756,613			823,195			2,499,490			2,516,625
Goodwill		32,054			32,718			534,607			539,469
Assets held for sale		57,999			—			22,795			19,603
Deferred charges and other assets, net of accumulated amortization		20,145			10,260
Other assets, net of accumulated amortization								38,517			56,197

TOTAL ASSETS	$	1,041,476		$	1,076,233		$	4,100,204		$	4,020,358

LIABILITIES:
Accounts payable	$	491		$	481		$	2,826		$	1,858
Accrued expenses		23,161			18,857			46,890			58,449
Other current liabilities		21,223			19,603			114,491			118,438
Non-controlling interest - variable interest entity		—			23,959
Long-term debt, current portion		3,618			4,817
Operating lease liabilities								37,434			—

Total current liabilities		48,493			67,717			201,641			178,745

Long-term debt, net of current portion		470,923			467,651			1,692,258			1,872,203
Operating lease liabilities, net of current portion								275,739			—
Deferred tax liabilities		82,652			92,898			546,971			545,982
Other long-term liabilities		28,506			26,861			52,097			89,168

Total long-term liabilities		582,081			587,410			2,567,065			2,507,353

Total liabilities		630,574			655,127			2,768,706			2,686,098

CONTINGENCIES AND COMMITMENTS
PERPETUAL CUMULATIVE CONVERTIBLE PREFERRED STOCK		27,845			27,732

SHAREHOLDERS’ EQUITY:
Class A, B and C common stock		407			407			1,427			1,412
Additional paid-in capital		589,524			605,603			1,682,891			1,693,512
Accumulated deficit		(206,874	)		(212,636	)		(352,820	)		(360,664	)

Total shareholders’ equity		383,057			393,374			1,331,498			1,334,260

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,041,476		$	1,076,233		$	4,100,204		$	4,020,358

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(amounts in thousands, except share and per share data)

(unaudited)


	THREE MONTHS ENDED						NINE MONTHS ENDED						THREE MONTHS ENDED
	SEPTEMBER 30,												MARCH 31,
	2017			2016			2017			2016			2019			2018
NET REVENUES	$	122,299		$	121,641		$	346,270		$	340,221		$	309,005		$	300,560

OPERATING EXPENSE:
Station operating expenses, including non-cash compensation expense		87,853			84,089			256,022			240,442
Station operating expenses														248,985			255,725
Depreciation and amortization expense		2,904			2,488			8,068			7,452			11,104			8,471
Corporate general and administrative expenses, including non-cash compensation expense		9,335			8,797			28,776			24,888
Impairment loss		—			—			441			62
Corporate general and administrative expenses														20,935			18,669
Integration costs														1,135			9,729
Restructuring charges														1,014			1,481
Merger and acquisition costs		8,825			670			24,925			670			9			1,383
Net time brokerage agreement (income) fees		—			—			34			—			40			(426	)
Net (gain) loss on sale or disposal of assets		(103	)		(91	)		13,155			(1,310	)		(4,600	)		(161	)

Total operating expense		108,814			95,953			331,421			272,204			278,622			294,871

OPERATING INCOME (LOSS)		13,485			25,688			14,849			68,017			30,383			5,689

NET INTEREST EXPENSE		6,476			9,014			18,586			27,553			25,220			23,404
OTHER (INCOME) EXPENSE		—			(2,299	)		—			(2,299	)

INCOME (LOSS) BEFORE INCOME TAXES (BENEFIT)		7,009			18,973			(3,737	)		42,763			5,163			(17,715	)
INCOME TAXES (BENEFIT)		2,909			7,553			(4,921	)		16,097			2,038			(3,509	)

NET INCOME (LOSS) AVAILABLE TO THE COMPANY		4,100			11,420			1,184			26,666
Preferred stock dividend		(663	)		(526	)		(1,763	)		(1,351	)
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS - CONTINUING OPERATIONS														3,125			(14,206	)
Income from discontinued operations, net of income taxes (benefit)														—			328

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	3,437		$	10,894		$	(579	)	$	25,315		$	3,125		$	(13,878	)

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS PER SHARE - BASIC	$	0.09		$	0.28		$	(0.01	)	$	0.66
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS PER SHARE - BASIC AND DILUTED
Net income (loss) from continuing operations per share available to common shareholders - Basic and Diluted													$	0.02		$	(0.10	)

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS PER SHARE - DILUTED	$	0.09		$	0.28		$	(0.01	)	$	0.64
Net income (loss) from discontinued operations per share available to common shareholders - Basic and Diluted													$	—		$	—

DIVIDENDS DECLARED AND PAID PER COMMON SHARE	$	0.275		$	0.075		$	0.425		$	0.150
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS PER SHARE - BASIC AND DILUTED													$	0.02		$	(0.10	)

WEIGHTED AVERAGE SHARES:
Basic		38,954,788			38,484,578			38,947,533			38,457,061			138,099,180			138,939,309

Diluted		39,727,976			41,433,200			38,947,533			39,373,988			138,523,371			138,939,309

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

~~NINE~~THREE MONTHS ENDED ~~SEPTEMBER 30, 2017~~MARCH 31, 2019 AND YEAR ENDED DECEMBER 31, ~~2016~~2018

(amounts in thousands, except share data)

(unaudited)


	Common Stock										Additional Paid-in Capital			Retained Earnings (Accumulated Deficit)				Total																							Retained
	Class A						Class B														Common Stock															Additional				Earnings
	Shares			Amount			Shares		Amount												Class A								Class B							Paid-in				(Accumulated
Balance, December 31, 2015		32,480,551		$	325			7,197,532	$	72	$	611,754			$	(250,701	)		$	361,450
																						Shares				Amount				Shares			Amount				Capital				Deficit)			Total
Balance, December 31, 2017																							139,675,781			$	1,397				4,045,199		$	40			$	1,737,132			$	25,791		$	1,764,360
Net income (loss) available to the Company		—			—			—		—		—			38,065				38,065				—				—				—			—				—				(13,878	)		(13,878	)
Compensation expense related to granting of stock awards		1,095,759			11			—		—		6,528				—				6,539				(157,680	)			(2	)			—			—				3,915				—			3,913
Issuance of common stock related to the Employee Stock Purchase Plan (“ESPP”)		31,933			—			—		—		379			—				379				39,196				—				—			—				321				—			321
Exercise of stock options		134,238			1			—		—		264			—				265				10,000				—				—			—				13				—			13
Common stock repurchase																							(1,833,200	)			(18	)			—			—				(19,361	)			—			(19,379	)
Purchase of vested employee restricted stock units		(232,297	)		(2	)		—		—		(2,266	)		—				(2,268	)			(328,196	)			(3	)			—			—				(3,460	)			—			(3,463	)
Payment of dividends on common stock		—			—			—		—		(8,666	)		—				(8,666	)			—				—				—			—				(13,036	)			—			(13,036	)
Payment of dividends on preferred stock		—			—			—		—		(1,788	)		—				(1,788	)
Dividend equivalents, net of forfeitures		—			—			—		—		(602	)		—				(602	)			—				—				—			—				342				—			342

Balance, December 31, 2016		33,510,184			335			7,197,532		72		605,603			(212,636	)			393,374
Balance, March 31, 2018																							137,405,901			$	1,374				4,045,199		$	40			$	1,705,866			$	11,913		$	1,719,193
Net income (loss) available to the Company																							—				—				—			—				—				(347,557	)		(347,557	)
Compensation expense related to granting of stock awards																							1,053,514				11				—			—				11,225				—			11,236
Issuance of common stock related to the Employee Stock Purchase Plan (“ESPP”)																							189,031				2				—			—				1,105				—			1,107
Exercise of stock options																							103,137				1				—			—				139				—			140
Common stock repurchase																							(1,393,100	)			(14	)			—			—				(10,014	)			—			(10,028	)
Purchase of vested employee restricted stock units																							(178,270	)			(2	)			—			—				(1,721	)			—			(1,723	)
Payment of dividends on common stock																							—				—				—			—				(12,746	)			(24,861	)		(37,607	)
Dividend equivalents, net of forfeitures																							—				—				—			—				(342	)			(159	)		(501	)

Balance, December 31, 2018																							137,180,213			$	1,372				4,045,199		$	40			$	1,693,512			$	(360,664	)	$	1,334,260
Net income (loss) available to the Company		—			—			—		—		—			1,184				1,184				—				—				—			—				—				3,125			3,125
Compensation expense related to granting of stock awards		183,980			2			—		—		4,627			—				4,629				1,406,722				14				—			—				3,559				—			3,573
Issuance of common stock related to the Employee Stock Purchase Plan (“ESPP”)		14,833			—			—		—		182			—				182				84,958				1				—			—				378				—			379
Exercise of stock options		6,500			—			—		—		22			—				22				180,300				2				—			—				242				—			244
Purchase of vested employee restricted stock units		(167,620	)		(2	)		—		—		(2,544	)		—				(2,546	)			(204,499	)			(2	)			—			—				(1,424	)			—			(1,426	)
Payment of dividends on common stock		—			—			—		—		(16,659	)		—				(16,659	)			—				—				—			—				(12,913	)			—			(12,913	)
Dividend equivalents, net of forfeitures		—			—			—		—		(591	)		—				(591	)			—				—				—			—				(463	)			—			(463	)
Payment of dividends on preferred stock		—			—			—		—		(1,650	)		—				(1,650	)
Modified retrospective application of stock-based compensation guidance		—			—			—		—		534			4,578				5,112
Application of amended leasing guidance																							—				—				—			—				—				4,719			4,719

Balance, September 30, 2017		33,547,877		$	335			7,197,532	$	72	$	589,524		$	(206,874	)		$	383,057
Balance, March 31, 2019																							138,647,694			$	1,387				4,045,199		$	40			$	1,682,891			$	(352,820	)	$	1,331,498

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(amounts in thousands)

(unaudited)


	NINE MONTHS ENDED SEPTEMBER 30,						THREE MONTHS ENDED MARCH 31,
	2017			2016			2019			2018
OPERATING ACTIVITIES:
Net income (loss) available to the Company	$	1,184		$	26,666		$	3,125		$	(13,878	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization		8,068			7,452			11,104			8,471
Amortization of deferred financing costs (including original issue discount)		1,752			2,209
Net amortization of deferred financing costs (net of original issue discount and debt premium)								86			79
Net deferred taxes (benefit) and other		(4,921	)		16,097			(2,669	)		(5,252	)
Provision for bad debts		1,742			1,129			326			2,982
Net (gain) loss on sale or disposal of assets		13,155			(1,310	)		(4,600	)		(161	)
Non-cash stock-based compensation expense		4,629			4,660			3,573			3,913
Deferred rent		(109	)		208
Deferred compensation		2,242			1,471			2,802			126
Impairment loss		441			62
Accretion expense (income), net of asset retirement obligation adjustments		(341	)		23			17			15
Changes in assets and liabilities (net of effects of acquisitions, dispositions, consolidation, and deconsolidation of Variable Interest Entities (VIEs)):
Accounts receivable		(4,057	)		(5,390	)		72,495			66,692
Prepaid expenses and deposits		(2,079	)		(2,044	)		(8,808	)		(3,968	)
Accounts payable and accrued liabilities		6,983			(192	)		(12,789	)		206
Accrued interest expense		(1,759	)		4,749			6,698			7,155
Accrued liabilities - long-term		(1,438	)		(1,639	)		(5,629	)		(455	)
Prepaid expenses - long-term		(83	)		(3,166	)		—			(40	)

Net cash provided by (used in) operating activities		25,409			50,985			65,731			65,885

INVESTING ACTIVITIES:
Additions to property and equipment		(12,056	)		(4,316	)		(18,622	)		(5,413	)
Proceeds from sale of property, equipment, intangibles and other assets		18			7,118
Purchases of radio stations		(24,000	)		(92	)
Proceeds from sale of radio stations and other assets								24,503			461
Additions to amortizable intangible assets		(663	)		(188	)		(1,888	)		(1,578	)
Purchases of investments		(9,700	)		—			—			(1,250	)
(Deconsolidation) consolidation of a VIE		(302	)		—
Additions to non-amortizable intangible assets		—			(35	)

Net cash provided by (used in) investing activities		(46,703	)		2,487			3,993			(7,780	)

ENTERCOM COMMUNICATIONS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(amounts in thousands)

(unaudited)


	NINE MONTHS ENDED SEPTEMBER 30,						THREE MONTHS ENDED MARCH 31,
	2017			2016			2019			2018
FINANCING ACTIVITIES:
Borrowing under the revolving senior debt		57,500			21,500
Proceeds from the capital lease obligations and other		—			102
Payments of long-term debt		(57,012	)		(65,262	)	$	(180,000	)	$	(21,325	)
Proceeds from issuance of employee stock plan		182			194			379			321
Proceeds from the exercise of stock options		22			39			244			13
Purchase of vested employee restricted stock units		(2,546	)		(2,205	)		(1,426	)		(3,463	)
Payment of dividends on common stock		(16,550	)		(5,772	)		(12,430	)		(12,441	)
Payment of dividend equivalents on vested restricted stock units		(109	)		(91	)		(483	)		(595	)
Payment of dividends on preferred stock		(1,650	)		(1,238	)
Repurchase of common stock								—			(20,012	)

Net cash provided by (used in) financing activities		(20,163	)		(52,733	)		(193,716	)		(57,502	)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(41,457	)		739
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR		46,843			9,169
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH								(123,992	)		603
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF YEAR								192,258			34,167

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	5,386		$	9,908
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD							$	68,266		$	34,770

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	19,474		$	21,046		$	18,446		$	16,497

Income taxes	$	352		$	339		$	1,790		$	45

Dividends on common stock	$	16,550		$	5,772		$	12,430		$	12,441

Dividends on preferred stock	$	1,650		$	1,238

See notes to condensed consolidated financial statements.

ENTERCOM COMMUNICATIONS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~NINE~~THREE MONTHS ENDED ~~SEPTEMBER 30, 2017~~MARCH 31, 2019 AND ~~2016~~2018

1.	BASIS OF PRESENTATION AND SIGNIFICANT POLICIES

The condensed consolidated interim unaudited financial statements included herein have been prepared by Entercom Communications Corp. and its subsidiaries (collectively, the “Company”) in accordance with: (i) generally accepted accounting principles (“U.S. GAAP”) for interim financial information; and (ii) the instructions of the Securities and Exchange Commission (the “SEC”) for Form10-Q and Article 10 of RegulationS-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, the financial statements reflect all adjustments considered necessary for a fair statement of the results of operations and financial position for the interim periods presented. All such adjustments are of a normal and recurring nature. The Company’s results are subject to seasonal fluctuations and, therefore, the results shown on an interim basis are not necessarily indicative of results for a full year.

This Form10-Q should be read in conjunction with the financial statements and related notes included in the Company’s audited financial statements as of and for the year ended December 31, ~~2016,~~2018, and filed with the SEC on February ~~28, 2017,~~27, 2019, as part of the Company’s Annual Report on Form10-K. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations.

~~On February 2, 2017,~~The Company considers the applicability of any variable interest entities (“VIEs”) that are required to be consolidated by the primary beneficiary. As of March 31, 2019, there were no VIEs requiring consolidation in these financial statements. As of December 31, 2018, there was one VIE that required consolidation in these financial statements. During 2018, the Company ~~and its newly formed wholly owned subsidiary (“Merger Sub”)~~ entered into an ~~Agreement~~agreement with a third party qualified intermediary (“QI”), under which the Company was primarily responsible for the oversight and ~~Plan~~completion of ~~Merger (the “CBS Radio Merger Agreement”) with CBS Corporation (“CBS”) and its wholly owned subsidiary CBS Radio Inc. (“CBS Radio”). Pursuant~~certain construction projects. This agreement related to the ~~CBS Radio Merger Agreement, Merger Sub will merge with and into CBS Radio with CBS Radio surviving~~creation of leasehold improvement assets on property that had already been made available for tenant use. The Company believed it was the primary beneficiary of the VIE as the ~~Company’s wholly owned subsidiary~~Company had the power to direct the activities that were most significant to the VIE and the Company had the obligation to absorb losses or the right to receive returns that would be significant to the VIE during the period of the agreement.

The use of a QI in a like-kind exchange enabled the Company to reduce its current tax liability in connection with certain asset dispositions. Under Section 1031 of the Internal Revenue Code (the ~~“Merger”~~“Code”)~~. The Merger is expected~~, the property to be ~~tax free~~exchanged in the like-kind exchange was required to ~~CBS and its shareholders, and will~~ be ~~effected through a stock for stock Reverse Morris Trust transaction. The Merger will make~~received by the Company ~~a leading local media and entertainment company with a nationwide footprint~~within 180 days. This period of ~~stations including positions in all~~time lapsed during the first quarter of 2019, at which point, the Company acquired the interests of the ~~top 10 markets and 22~~QI. This arrangement effectively transformed the QI from a consolidated VIE to a consolidated subsidiary of the ~~top 25 markets.~~Company.

Total results of operations of the VIE for the three months ended March 31, 2019 and the year ended December 31, 2018 were not significant. The ~~transactions contemplated~~VIE had no impact on the Company’s results of operations for the three months ended March 31, 2018. The consolidated VIE had a material amount of cash as of December 31, 2018, which was reflected as restricted cash on the consolidated balance sheet. Restrictions on these deposits lapsed during the first quarter of 2019. As a result, the Company does not present restricted cash at March 31, 2019. The VIE had no other assets or liabilities as of December 31, 2018. The assets of the Company’s consolidated VIE could only be used to settle the obligations of the VIE. There was a lack of recourse by the ~~CBS Radio Merger Agreement are subject to approval by~~creditors of the VIE against the Company’s ~~shareholders and customary regulatory approvals. Such approvals will require the divestiture of stations in certain markets due~~general creditors. Refer to ~~regulatory requirements.~~Note 14, Contingencies And Commitments, for additional information.

There have been no material changes from Note 2, Significant Accounting Policies, as described in the notes to the Company’s financial statements contained in its Form10-K for the year ended December 31, ~~2016,~~2018, that was filed with the SEC on February ~~28, 2017.~~27, 2019, other than as described below.

~~Revision of Prior Period Financial Statements for Digital Revenue Contracts~~Changes in Accounting Policies – Leases

In ~~connection~~February 2016, the accounting guidance was modified to increase transparency and comparability among organizations by requiring the recognition ofright-of-use (“ROU”) assets and lease liabilities on the balance sheet.

The guidance was effective for the Company as of January 1, 2019, and was implemented using a modified retrospective approach at the beginning of the period of adoption, rather than at the beginning of the earliest comparative period presented in these financial statements.

As a result, the Company has changed its accounting policy for leases as described below. Except for the changes below, the Company has consistently applied its accounting policies to all periods presented in these consolidated financial statements. Refer to Note 4, Leases, for additional information.

Under certain practical expedients elected, the Company did not reassess whether any expired or existing contracts are or contain leases. The Company did not reassess lease classification between operating and finance leases for any expired or existing leases. The Company did not reassess initial direct costs for any existing leases.

Results for reporting periods beginning after January 1, 2019 are presented under the amended accounting guidance, while prior period amounts are not adjusted and continue to be reported in accordance with the ~~preparation~~Company’s historic accounting guidance. Based upon the Company’s assessment, the impact of this guidance had a material impact on the Company’s financial position and the impact to the Company’s results of operations and cash flows through March 31, 2019 was not material. As of January 1, 2019, the Company recorded a cumulative-effect adjustment to its accumulated deficit of $4.7 million, net of taxes of $1.7 million. This adjustment was attributable to the recognition of deferred gains from sale and leaseback transactions under the previous accounting guidance for leases.

The Company recognizes the assets and liabilities that arise from leases on the commencement date of the ~~Company’s consolidated financial statements,~~lease. The Company recognizes the ~~Company identified immaterial errors in prior periods relating~~liability to ~~the netting of certain digital expenses against certain digital revenues. Since the Company acts~~make lease payments as a ~~principal in certain digital revenue contracts,~~lease liability as well as a ROU asset representing its right to use the ~~expenses should not have been netted against gross revenues. The impact of these errors was not material to any prior period. Consequently,~~underlying asset for the Company corrected the errors in the second quarter of 2017 by increasing net revenues and station operating expenses on the consolidated statements of operations by the amounts below. As the two line items are adjusted by offsetting amounts, the corrections had no impact on income before taxes, income taxes (benefit), net income, earnings per share or diluted earnings per share, shareholders’ equity, cash flows from operations, or working capital. The corrections had no impactlease term, on the consolidated balance ~~sheets or statements of cash flows.~~sheet.

~~The following tables include the revisions to the consolidated statements of operations for the interim and annual periods during 2017, 2016, and 2015:~~

Description
Three Months Ended
March 31, 2017
(amounts in
thousands)
Net Revenues:

Prior to revision
$ 97,452
Revision
1,549

As revised
$ 99,001

Station operating expenses, including non-cash compensation expense:

Prior to revision
$ 75,617
Revision
1,549

As revised
$ 77,166

Three Months Ended Year Ended
March 31, June 30, September 30, December 31, December 31,
Description
2016
(amounts in thousands)
Net Revenues:

Prior to revision
$ 96,103 $ 120,478 $ 120,457 $ 123,207 $ 460,245
Revision
906 1,093 1,184 1,343 4,526

As revised
$ 97,009 $ 121,571 $ 121,641 $ 124,550 $ 464,771

Station operating expenses, including non-cash compensation expense:

Prior to revision
$ 71,715 $ 82,639 $ 82,905 $ 81,485 $ 318,744
Revision
906 1,093 1,184 1,343 4,526

As revised
$ 72,621 $ 83,732 $ 84,089 $ 82,828 $ 323,270

Three Months Ended Year Ended
March 31, June 30, September 30, December 31, December 31,
Description
2015
(amounts in thousands)
Net Revenues:

Prior to revision
$ 78,420 $ 100,592 $ 114,662 $ 117,704 $ 411,378
Revision
589 730 874 910 3,103

As revised
$ 79,009 $ 101,322 $ 115,536 $ 118,614 $ 414,481

Station operating expenses, including non-cash compensation expense:

Prior to revision
$ 59,367 $ 70,000 $ 81,241 $ 77,103 $ 287,711
Revision
589 730 874 910 3,103

As revised
$ 59,956 $ 70,730 $ 82,115 $ 78,013 $ 290,814

Recent Accounting Pronouncements

All new accounting pronouncements that are in effect that may impact the Company’s financial statements have been implemented. The Company does not believe that there are any other new accounting pronouncements that have been issued ~~other~~(other than as noted below or those included in the notes to the Company’s financial statements contained in its Form10-K for the year ended December 31, ~~2016,~~2018, that was filed with the SEC on February ~~28, 2017,~~27, 2019) that might have a material impact on the Company’s financial position, results of operations or cash flows.

~~Definition of a Business~~Leasing Transactions

In January 2017, the accounting guidance was amended to modify the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The guidance is effective forAs discussed above, the Company ~~as of January 1, 2018, under a prospective application method. As described in Note 10, Assets Held for Sale, and Note 13, Subsequent Events,~~implemented the Company entered into several binding and non-binding transactions with third parties in order to dispose of or exchange multiple radio stations in several markets. These divestitures and exchanges were entered into in order to comply with certain regulatory requirements, in order to facilitate the Merger. Based upon the Company’s preliminary assessment, which is subject to change, the impact of this guidance should not be material to the Company’s financial position, results of operations or cash flows. The guidance could have an impact in a future period if the Company acquires or disposes of assets that meet the definition of a business under the amended guidance.

~~Goodwill Impairment~~

In January 2017, the accounting guidance was amended to modify the accounting for goodwill impairment by removing the second step of the goodwill impairment test. The guidance is effective for the Company as of January 1, 2020, on a prospective basis, although early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company elected to early adopt this amended accounting guidance for its annual impairment test during the second quarter of 2017. The results of the Company’s annual goodwill impairment test indicated that the carrying value of the Company’s goodwill in one particular market exceeded its appraised enterprise value. As a result, the Company wrote off approximately $0.4 million of goodwill during the second quarter of 2017. Refer to Note 2, Intangible Assets and Goodwill, for additional information.

~~Cash Flow Classification~~

~~In August 2016, the accounting guidance for classifying elements of cash flow was modified. The guidance is effective for the Company as of~~leasing transactions on January 1, ~~2018, under a retrospective application method. Management does not believe the~~2019. There was no impact ~~of this guidance will be material~~ to ~~the Company’s financial position,~~previously reported results of operations ~~or cash flows.~~

~~Stock-Based Compensation~~

~~In May 2017,~~for any interim period. The most significant impact of the ~~accounting guidance was amended to clarify modification accounting for stock-based compensation. The guidance is effective for the Company as~~adoption of January 1, 2018, on a prospective basis, although early adoption is permitted for interim periods. Under the amended guidance, the Company will only apply modification accounting for stock-based compensation if there are: (1) changes in the fair value or intrinsic value of share-based compensation; (2) changes in the vesting conditions of awards; and (3) changes in the classification of awards as equity instruments or liability instruments. The Company is currently in the process of reviewing the new guidance, but based upon its preliminary assessment, which is subject to change, the impact of this guidance should not be material to the Company’s financial position, results of operations or cash flows.

In March 2016, the accounting guidance for stock-based compensation was modified primarily to: (1) record excess tax benefits or deficiencies on stock-based compensation in the statement of operations, regardless of whether the tax benefits reduce taxes payable in the period; (2) allow an employee’s use of shares to satisfy the employer’s statutory income tax withholding obligation up to the maximum statutory tax rates in the applicable jurisdictions; and (3) allow entities to make an accounting policy election to either estimate the number of award forfeitures or to account for forfeitures when they occur. Theleasing guidance was ~~effective for the Company on January 1, 2017.~~

As of January 1, 2017, the Company recorded a cumulative-effect adjustment to its accumulated deficit of $4.6 million on a modified retrospective transition basis. This adjustment was comprised of previously unrecognized excess tax benefits of $4.9 million as adjusted for the Company’s effective income tax rate, offset by a change to recognize stock-based compensation forfeitures when they occur of $0.3 million, net of tax.

~~Leasing Transactions~~

In February 2016, the accounting guidance was modified to increase transparency and comparability among organizations by requiring the recognition of right-of-use (“ROU”) assets and lease liabilities on the balance sheet. The most notable change in the standard is the recognition of ROU assets and lease liabilities ~~by lessees~~ for ~~those leases classified as~~ operating leases ~~with a term~~on the balance sheet of ~~more than one year. This change will apply to the Company’s leased assets such as real estate, broadcasting towers~~$288.7 million and equipment. Additionally, the Company will be required to provide additional disclosures to meet the objective of enabling users of the financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases.$306.2 million, respectively, on January 1, 2019. The ~~Company anticipates its accounting for existing capital leases to remain substantially unchanged.~~

~~While the Company is currently reviewing the effects of this guidance, the Company believes that this modification to operating leases would result in: (1) an increase in~~difference between the ROU assets and lease liabilities ~~reflected on the Company’s consolidated balance sheets~~recorded upon implementation is primarily attributable to ~~reflect the rights~~deferred rent balances and ~~obligations created by operating leases with a term of greater than one year;~~unfavorable lease liabilities which were combined and ~~(2) no material change to the expense associated with~~presented net within the ROU assets.

~~This guidance is effective for the Company as of January 1, 2019, and must be implemented using a modified retrospective approach, with certain practical expedients available.~~

~~Financial Instruments~~

In January 2016, the accounting guidance was modified with respect to recognition, measurement, presentation and disclosure of financial instruments. The most notable impact of the amended accounting guidance for the Company is that this modification effectively supersedes and eliminates current accounting guidance for cost-method investments. Refer to Note ~~8, Fair Value of Financial Instruments,~~4, Leases, for additional ~~information on the Company’s cost-method investments.~~information.

The guidance is effective for the Company as of January 1, 2018, and early adoption is not permitted. The Company will adopt the new guidance using a modified retrospective approach through a cumulative-effect adjustment to retained earnings, if applicable, as of the effective date.Reclassifications

~~The Company’s investments continue to be carried at their original cost and there~~Certain reclassifications have been ~~no impairments~~made to the prior year’s notes to the consolidated financial statements to conform to the presentation in the ~~cost-method investments or returns of capital. While the Company is currently reviewing the effects of this guidance, the Company believes that adoption of this modified accounting guidance would~~current year, which did not have a material impact on the Company’s previously reported financial ~~position, results of operations, or cash flows.~~

~~Revenue Recognition~~

In May 2014, the accounting guidance for revenue recognition was modified and subsequently updated with several amendments. Along with these modifications, most industry-specific revenue guidance was eliminated, including a current broadcasting exemption for reporting revenue from network barter programming. The new guidance provides companies with a revenue recognition model for recognizing revenue from contracts with customers. The core principle of the new standard is to recognize revenue when promised goods or services are transferred to customers, in an amount that reflects the consideration that the Company expects to be entitled to in exchange for such goods or services. The new guidance also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The new guidance may be implemented using a modified retrospective approach or by using a full retrospective approach. The new guidance was originally effective for annual reporting periods beginning after December 15, 2016. In July 2015, the effective date was deferred by one year. As a result, the new guidance is effective for the Company as of January 1, 2018.

The Company has completed the first two phases of the implementation process. In connection with the first phase, the Company performed the following activities during the second quarter of 2017: (1) completed an internal assessment of the Company’s operations and identified its significant revenue streams; (2) held revenue recognition conversations with certain of its sales managers and business managers across its markets for each of the identified

revenue streams; and (3) reviewed a representative sample of contracts and documented the key economics of the contracts to identify applicable qualitative revenue recognition changes related to the amended accounting guidance. In connection with the second phase, the Company performed the following activities during the third quarter of 2017: (1) established and documented key accounting policies; (2) assessed the disclosure requirements of the new standard; and (3) determined the impact on business processes and internal controls. The Company’s final phase will be to effectively implement the amended accounting guidance and embed the new accounting treatment into the Company’s business processes and internal controls to support the financial reporting requirements. The Company expects to complete this final phase of the implementation process in the fourth quarter of 2017. The Company plans to adopt the amended accounting guidance as of January 1, 2018, using the modified retrospective method.

The Company is still evaluating the impact that the amended accounting guidance will have on the Company’s consolidated financial statements and will be unable to quantify its impact until it completes the final phase of its implementation process. Based upon its preliminary assessment, which is subject to change, the impact of this guidance should not be material to the Company’s financial position, results of operations or cash flows. Upon adoption of this guidance, the Company will enhance its current disclosures to allow users of the financial statements to comprehend information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from the Company’s contracts with its customers.

~~2. INTANGIBLE ASSETS AND GOODWILL~~

Goodwill and certain intangible assets are not amortized for book purposes. They may be, however, amortized for tax purposes. The Company accounts for its acquired broadcasting licenses as indefinite-lived intangible assets and, similar to goodwill, these assets are reviewed at least annually for impairment. At the time of each review, if the fair value is less than the carrying value of goodwill and certain intangibles (such as broadcasting licenses), then a charge is recorded to the results of operations.

~~There was no material change in the carrying value of broadcasting licenses or goodwill since the year ended December 31, 2016, other than as described below.~~

The Company recorded a $13.5 million loss in the first quarter of 2017 in net gain/loss on sale or disposal of assets as a result of the Company permanently discontinuing the operation of one of its stations and returning the station’s broadcasting license to the FCC for cancellation, in order to facilitate the Merger.

Additionally, the carrying value of the broadcasting licenses at December 31, 2016, included the broadcasting licenses of a consolidated Variable Interest Entity (“VIE”) of approximately $15.7 million. These consolidated assets and liabilities of the VIE related to a pending acquisition of four radio stations in Charlotte, North Carolina. On October 17, 2016, the Company entered into an asset purchase agreement and a time brokerage agreement (“TBA”) to operate three of the four radio stations that were held in a trust (“Charlotte Trust”). As such, the amounts of the consolidated VIE at December 31, 2016, represented only the assets and liabilities of the three stations held in the Charlotte Trust.

Upon the completion of this transaction on January 6, 2017, the Company deconsolidated broadcasting licenses attributable to the VIE and recorded broadcasting licenses of all four radio stations based upon the preliminary purchase price allocation. Refer to Note 9, Business Combinations, for additional information.

On September 26, 2017, the Company entered into an agreement to divest three stations to Educational Media Foundation (“EMF”). This transaction is the first divestiture in a series of required divestitures related to the Company’s pending Merger with CBS Radio. The Company conducted an analysis and determined the assets of these three stations met the criteria to be classified as held for sale at September 30, 2017. Accordingly, the Company reclassified the amount of radio broadcasting licenses and goodwill allocable to these three stations to the assets held for sale financial statement line item at September 30, 2017. Refer to Note 10, Assets Held for Sale, for additional information.

During the second quarter of 2017, the Company performed its annual impairment test of its goodwill and determined that the carrying amount of goodwill exceeded its fair value for the Boston, Massachusetts market and recorded an impairment loss of $0.4 million. A contributing factor to the impairment was a decline in the advertising dollars in the Boston, Massachusetts market and its effect on the Company’s operations, coupled with an increase in the carrying value of its assets.

~~The following table presents the changes in broadcasting licenses as described above:~~

Broadcasting Licenses
Carrying Amount
September 30,
2017 December 31,
2016
(amounts in thousands)
Beginning of period balance as of January 1,
$ 823,195 $ 807,381
Disposition of FCC broadcasting license
(13,500 ) —
Consolidation (deconsolidation) of a VIE
(15,738 ) 15,738
Acquisition of radio stations
17,174 —
Acquisitions—other
—   112
Assets held for sale
(54,518 ) —
Disposition of radio stations previously reflected as held for sale
—   (36 )

Ending period balance
$ 756,613 $ 823,195

~~The following table presents the changes in goodwill primarily as a result of acquisitions of radio stations, the pending divestiture of three stations, and the Company’s annual impairment test.~~

Goodwill Carrying Amount
September 30,
2017 December 31,
2016
(amounts in thousands)
Goodwill balance before cumulative loss on impairment as of January 1,
$ 158,333 $ 158,244
Accumulated loss on impairment as of January 1,
(125,615 ) (125,615 )

Goodwill beginning balance after cumulative loss on impairment as of January 1,
32,718 32,629
Loss on impairment during year
(441 ) —
Acquisition of radio stations
43 —
Assets held for sale
(266 ) —
Adjustment to acquired goodwill associated with an assumed fair value liability
—   92
Disposition of radio stations previously reflected as assets held for sale
—   (3 )

Ending period balance
$ 32,054 $ 32,718

~~Broadcasting Licenses Impairment Test~~

The Company performs its annual broadcasting license impairment test during the second quarter of each year by evaluating its broadcasting licenses for impairment at the market level using the direct method.

During the second quarter of the current year and each of the past several years, the Company completed its annual impairment test for broadcasting licenses and determined that the fair value of its broadcasting licenses was greater than the amount reflected in the balance sheet for each of the Company’s markets and, accordingly, no impairment was recorded. The annual impairment test in 2017 did not include the new market acquired during the first quarter of 2017. For the new market acquired during the first quarter of 2017, similar valuation techniques that are used in the testing process were applied to the valuation of the broadcasting licenses under purchase price accounting.

Each market’s broadcasting licenses are combined into a single unit of accounting for purposes of testing impairment, as the broadcasting licenses in each market are operated as a single asset. The Company determines the fair value of the broadcasting licenses in each of its markets by relying on a discounted cash flow approach (a 10-year income model) assuming a start-up scenario in which the only assets held by an investor are broadcasting licenses. The Company’s fair value analysis contains assumptions based upon past experience, reflects expectations

of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. These assumptions include, but are not limited to: (1) the discount rate; (2) the market share and profit margin of an average station within a market, based upon market size and station type; (3) the forecast growth rate of each radio market; (4) the estimated capital start-up costs and losses incurred during the early years; (5) the likely media competition within the market area; (6) the tax rate; and (7) future terminal values.

The methodology used by the Company in determining its key estimates and assumptions was applied consistently to each market. Of the seven variables identified above, the Company believes that the assumptions in items (1) through (3) above are the most important and sensitive in the determination of fair value.

If actual market conditions are less favorable than those projected by the industry or the Company, or if events occur or circumstances change that would reduce the fair value of the Company’s broadcasting licenses below the amount reflected in the balance sheet, the Company may be required to conduct an interim test and possibly recognize impairment charges, which may be material, in future periods.

There were no events or circumstances since the Company’s second quarter annual license impairment test that indicated an interim review of broadcasting licenses was required, other than as described below.

~~Goodwill Impairment Test~~

~~The Company performs its annual goodwill impairment test during the second quarter of each year by evaluating its goodwill for each reporting unit.~~

As described above, the Company elected to early adopt the amended accounting guidance which simplifies the test for goodwill impairment. The amended guidance eliminates the second step of the goodwill impairment test, which reduces the cost and complexity of evaluating goodwill for impairment. Under the former accounting guidance, the second step of the impairment test required the Company to compute the implied fair value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination. Under the amended guidance, if the carrying amount of goodwill of a reporting unit exceeds its fair value, the Company will consider the goodwill to be impaired.

The Company has determined that a radio market is a reporting unit and the Company assesses goodwill in each of the Company’s markets. Under the amended guidance, if the fair value of any reporting unit is less than the amount reflected on the balance sheet, the Company will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The loss recognized will not exceed the total amount of goodwill allocated to the reporting unit.

Under the amended guidance, the Company first assesses qualitative factors to determine whether it is necessary to perform a quantitative assessment for each reporting unit. These qualitative factors include, but are not limited to: (1) macroeconomic conditions; (2) radio broadcasting industry considerations; (3) financial performance of reporting units; (4) Company-specific events; and (5) a sustained decrease in the Company’s share price. If the quantitative assessment is necessary, the Company determines the fair value of the goodwill allocated to each reporting unit.

To determine the fair value, the Company uses a market approach and, when appropriate, an income approach in computing the fair value of each reporting unit. The market approach calculates the fair value of each market’s radio stations by analyzing recent sales and offering prices of similar properties expressed as a multiple of cash flow. The income approach utilizes a discounted cash flow method by projecting the subject property’s income over a specified time and capitalizing at an appropriate market rate to arrive at an indication of the most probable selling price. Management believes that these approaches are commonly used and appropriate methodologies for valuing broadcast radio stations. Factors contributing to the determination of the reporting unit’s operating performance were historical performance and/or management’s estimates of future performance.

During the second quarter of the current year, the Company’s quantitative assessment indicated that the goodwill allocated to its Boston, Massachusetts market was impaired. The annual impairment test in 2017 did not include the new market acquired during the first quarter of 2017. For the new market acquired during the first quarter of 2017, similar valuation techniques that are used in the testing process were applied to the valuation of the goodwill under purchase price accounting.

If actual market conditions are less favorable than those projected by the industry or the Company, or if events occur or circumstances change that would reduce the fair value of the Company’s goodwill below the amount reflected in the balance sheet, the Company may be required to conduct an interim test and possibly recognize impairment charges, which could be material, in future periods.

~~There were no events or circumstances since the Company’s second quarter annual goodwill test that indicated an interim review of goodwill was required, other than as described below.~~

~~Annual Broadcasting Licenses and Goodwill Impairment Test for Newly Acquired Market~~

As discussed above, the annual impairment test for broadcasting licenses and goodwill, which was performed in the second quarter of 2017, did not include the broadcasting licenses and goodwill of the new market acquired by the Company during the first quarter of 2017. As the new market’s broadcasting licenses and goodwill are required to be tested at least annually for impairment, the Company elected to conduct an annual impairment test during the third quarter of 2017 of the broadcasting licenses and goodwill of the newly acquired market only.

Conducting this interim impairment test on the broadcasting licenses and goodwill of the newly acquired market will allow the Company to align the testing periods of all markets in the annual impairment test performed in the second quarter of 2018 and each annual impairment test thereafter.

The annual impairment test of the newly acquired market’s broadcasting licenses and goodwill applied similar valuation techniques, valuation approaches and assumptions to those used in the annual impairment test conducted in the second quarter of 2017. The Company made reasonable estimates and assumptions to calculate the fair value of the newly acquired market’s broadcasting licenses and goodwill. These estimates and assumptions could be materially different from actual results. As a result of the annual impairment test of the newly acquired market, the Company determined that the fair value of its broadcasting licenses and goodwill was greater than the amount reflected in the balance sheet for the newly acquired market and, accordingly, no impairment was recorded.

~~3. OTHER CURRENT LIABILITIES~~

~~Other current liabilities consist of the following as of the periods indicated:~~

   Other Current Liabilities
   September 30,
2017    December 31,
2016
   (amounts in thousands)
Accrued compensation
   $ 9,628    $ 8,059
Accounts receivable credits
   2,590    3,571
Advertiser obligations
   2,540    1,102
Accrued interest payable
   1,828    3,587
Other
   4,637    3,284




Total other current liabilities
   $ 21,223    $ 19,603

~~4. LONG-TERM DEBT~~

~~(A) Senior Debt~~

~~The Credit Facility~~

On November 1, 2016, the Company and its wholly owned subsidiary, Entercom Radio, LLC, (“Radio”) entered into a $540 million credit agreement (the “Credit Facility”) with a syndicate of lenders that was initially comprised of: (a) a $60 million revolving credit facility (the “Revolver”) that matures on November 1, 2021; and (b) a $480 million term B loan (the “Term B Loan”) that matures on November 1, 2023.

As of September 30, 2017, the amount outstanding under the Term B Loan was $458.0 million and the amount outstanding under the Revolver was $22.5 million. The amount undrawn under the Revolver, which includes the impact of the outstanding letters of credit, was $36.8 million as of September 30, 2017. The Company’s ability to draw additional amounts under the Revolver may be limited due to its Consolidated Leverage Ratio.

~~Long-term debt was comprised of the following as of September 30, 2017:~~

   Long-Term Debt
   September 30,    December 31,
   2017    2016
   (amounts in thousands)
Credit Facility

Revolver, due November 1, 2021
   $ 22,500    $ —
Term B Loan, due November 1, 2023
   458,000    480,000




   480,500    480,000
Other Debt

Capital lease and other
   74    87




Total debt before deferred financing costs
   480,574    480,087
Current amount of long-term debt
   (3,618 )    (4,817 )
Deferred financing costs (excludes the revolving credit)
   (6,033 )    (7,619 )




Total long-term debt, net of current debt
   $ 470,923    $ 467,651




Outstanding standby letters of credit
   $ 700    $ 670

The Term B Loan requires mandatory prepayments equal to a percentage of Excess Cash Flow, which is defined within the agreement, subject to incremental step-downs, depending on the Consolidated Leverage Ratio. Beginning in 2018, the Excess Cash Flow payment will be due in the first quarter of each year, and is based on the Excess Cash Flow and Leverage Ratio for the prior year.

As of September 30, 2017, the Company’s Consolidated Leverage Ratio was 4.9 times versus a covenant limit of 5.0 times and the Consolidated Interest Coverage Ratio was 3.8 times versus a covenant minimum of 2.0 times.

As of September 30, 2017, the Company was in compliance with all financial covenants and all other terms of the Credit Facility in all material respects. The Company’s ability to maintain compliance with its covenants under the Credit Facility is highly dependent on its results of operations. Management believes that over the next 12 months the Company can continue to maintain compliance.

Management believes that cash on hand, cash from the Revolver and cash from operating activities, together with the proceeds of the committed financing described below, will be sufficient to permit the Company to meet its liquidity requirements over the next 12 months, including its debt repayments. The cash available from the Revolver is dependent on the Company’s Consolidated Leverage Ratio at the time of such borrowing.

Failure to comply with the Company’s financial covenants or other terms of its Credit Facility and any subsequent failure to negotiate and obtain any required relief from its lenders could result in a default under the Credit Facility. Any event of default could have a material adverse effect on the Company’s business and financial condition. The acceleration of the Company’s debt could have a material adverse effect on its business. The Company may seek from time to time to amend its Credit Facility or obtain other funding or additional funding, which may result in higher interest rates on its debt.

In connection with the CBS Radio Merger Agreement, CBS Radio entered into a commitment letter with a syndicate of lenders (the “Commitment Parties”), pursuant to which the Commitment Parties committed to provide up to $500 million of senior secured term loans (the “CBS Radio Financing”) as an additional tranche under a credit

agreement (the “CBS Radio Credit Agreement”) among CBS Radio, the guarantors named therein, the lenders named therein, and JPMorgan Chase Bank, N.A., as administrative agent. The proceeds of this additional tranche will be used to: (1) refinance the Company’s Credit Facility; (2) redeem the Company’s Perpetual Cumulative Convertible Preferred Stock (“Preferred”); and (3) pay fees and expenses in connection with the refinancing. On March 3, 2017, CBS Radio entered into an amendment to the CBS Radio Credit Agreement, to, among other things, create a tranche of Term B-1 Loans in an aggregate principal amount not to exceed $500 million. The Term B-1 Loans, which replace the commitment, are expected to be funded by the Commitment Parties on the closing date of the Merger, subject to customary conditions. The Term B-1 Loans will be governed by the CBS Radio Credit Agreement and will mature on the date that is seven years after the closing date of the Merger. The Term B-1 Loans will require quarterly principal payments at an annual rate of 1% of the initial principal amount of the Term B-1 Loans, beginning with the first full fiscal quarter ending after the closing of the Merger. The Term B-1 Loans are expected to bear interest at a per annum rate equal to LIBOR plus 2.75%. Interest on the Term B-1 Loans will be payable at the end of each interest period, but in no event less frequently than quarterly.

~~(B) Senior Unsecured Debt~~

~~The Senior Notes~~

In 2016, the Company issued a call notice to redeem its $220.0 million 10.5% unsecured Senior Notes due December 1, 2019 (the “Senior Notes”) in full with an effective date of December 1, 2016, that was funded by the proceeds of the Credit Facility. As a result of the full redemption of the Senior Notes with replacement debt at a lower interest rate, the net interest expense for the first three quarters of 2017 was reduced and does not include amortization of original issue discount of Senior Notes.

~~(C) Net Interest Expense~~

~~The components of net interest expense are as follows:~~

   Net Interest Expense
   Nine Months Ended
September 30,
   2017    2016
   (amounts in thousands)
Interest expense
   $ 16,913    $ 25,382
Amortization of deferred financing costs
   1,752    1,929
Amortization of original issue discount of senior notes
   —      280
Interest income and other investment income
   (79 )    (38 )




Total net interest expense
   $ 18,586    $ 27,553




   Net Interest Expense
   Three Months Ended
September 30,
   2017    2016
   (amounts in thousands)
Interest expense
   $ 5,920    $ 8,324
Amortization of deferred financing costs
   586    611
Amortization of original issue discount of senior notes
   —      96
Interest income and other investment income
   (30 )    (17 )




Total net interest expense
   $ 6,476    $ 9,014

~~5. NET INCOME (LOSS) PER COMMON SHARE~~

~~The following tables present the computations of basic and diluted net income (loss) per share:~~

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
(amounts in thousands except per
share data)
Basic Income (Loss) Per Share

Numerator

Net income (loss) available to the Company
$ 4,100 $ 11,420 $ 1,184 $ 26,666
Preferred stock dividends
663 526 1,763 1,351

Net income (loss) available to common shareholders
$ 3,437 $ 10,894 $ (579 ) $ 25,315

Denominator

Basic weighted average shares outstanding
38,955 38,485 38,948 38,457

Basic net income (loss) per share available to common shareholders
$ 0.09 $ 0.28 $ (0.01 ) $ 0.66

Diluted Income (Loss) Per Share

Numerator

Net income (loss) available to the Company
$ 4,100 $ 11,420 $ 1,184 $ 26,666
Preferred stock dividends
663 —   1,763 1,351

Net income (loss) available to common shareholders
$ 3,437 $ 11,420 $ (579 ) $ 25,315

Denominator

Basic weighted average shares outstanding
38,955 38,485 38,948 38,457
Effect of RSUs and options under the treasury stock method
773 1,014 —   917
Preferred stock under the as if converted method
—   1,934 —   —

Diluted weighted average shares outstanding
39,728 41,433 38,948 39,374

Diluted net income (loss) per share available to common shareholders
$ 0.09 $ 0.28 $ (0.01 ) $ 0.64

~~Disclosure Of Anti-Dilutive Shares~~

~~The following table presents those shares excluded as they were anti-dilutive:~~

Three Months Ended Nine Months Ended
September 30, September 30,
Impact Of Equity Issuances
2017 2016 2017 2016
(amounts in thousands, except per share data)
Shares excluded as anti-dilutive under the treasury stock method:

Options
14 —   —   —

Price range of options: from
$ 11.69 $ —   $ —   $ —

Price range of options: to
$ 11.78 $ —   $ —   $ —

RSUs with service conditions
157 —   101 —

RSUs excluded with service and market conditions as market conditions not met
267 478 267 478

RSUs excluded with service and performance conditions as performance conditions not met
—   21 —   21

Perpetual cumulative convertible preferred stock treated as anti-dilutive under the as if method
2,017 —   2,017 1,934

Excluded shares as anti-dilutive when reporting a net loss
—   —   974 —

~~6. SHARE-BASED COMPENSATION~~

~~Under the Entercom Equity Compensation Plan (the “Plan”), the Company is authorized to issue share-based compensation awards to key employees, directors and consultants.~~

~~Restricted Stock Units (“RSUs”) Activity~~

~~The following is a summary of the changes in RSUs under the Plan during the current period:~~

Period Ended Number Of
Restricted
Stock Units Weighted
Average
Purchase
Price Weighted
Average
Remaining
Contractual
Term
(Years) Aggregate
Intrinsic
Value As Of
September 30,
2017
RSUs outstanding as of:
December 31, 2016 2,074,794
RSUs awarded
206,603
RSUs released
(468,153 )
RSUs forfeited
(22,623 )

RSUs outstanding as of:
September 30, 2017 1,790,621 $ —   1.2 $ 20,413,079

RSUs vested and expected to vest as of:
September 30, 2017 1,790,621 $ —   1.2 $ 20,413,079

RSUs exercisable (vested and deferred) as of:
September 30, 2017 48,880 $ —   —   $ 557,232

Weighted average remaining recognition period in years
1.9

Unamortized compensation expense
$ 8,259,906

~~RSUs With Service And Market Conditions~~

The Company issued RSUs with service and market conditions that are included in the table above. These shares vest if: (1) the Company’s stock achieves certain shareholder performance targets over a defined measurement period; and (2) the employee fulfills a minimum service period. The compensation expense is recognized even if the market conditions are not satisfied and are only reversed in the event the service period is not met, as all of the conditions need to be satisfied. These RSUs are amortized over the longest of the explicit, implicit or derived service periods, which range from approximately one to three years.

~~The following table presents the changes in outstanding RSUs with market conditions:~~

   Nine Months Ended
September 30,    Year Ended
December 31,
   2017    2016

(amounts in thousands, except per
share data)

Reconciliation Of RSUs With Market Conditions

Beginning of period balance
   630    390
Number of RSUs granted
   —      470
Number of RSUs forfeited
   —      —
Number of RSUs vested
   (50 )    (230 )




End of period balance
   580    630




Weighted average fair value of RSUs granted with market conditions
   $ —      $ 7.34

The fair value of RSUs with service conditions is estimated using the Company’s closing stock price on the date of the grant. To determine the fair value of RSUs with service and market conditions, the Company used the Monte Carlo simulation lattice model. The Company’s determination of the fair value was based on the number of shares granted, the Company’s stock price on the date of grant and certain assumptions regarding a number of highly complex and subjective variables. If other reasonable assumptions were used, the results could differ.

~~The specific assumptions used for these valuations are as follows:~~statements.

2.
	~~Nine Months Ended~~ ~~September 30, 2017~~		~~Year Ended~~ ~~December 31,~~ ~~2016~~
~~Expected Volatility Term Structure~~⁽¹⁾BUSINESS COMBINATIONS		—	~~35% to 45%~~
~~Risk-Free Interest Rate~~⁽²⁾		—	~~0.4% to 1.1%~~
~~Annual Dividend Payment Per Share (Constant)~~⁽³⁾	$	—	~~$0.30~~

⁽¹⁾	Expected Volatility Term Structure—The Company estimated the volatility term structure using: (1) the historical volatility of its stock; and (2) the implied volatility provided by its traded options from a trailing month’s average of the closing bid-ask price quotes.

⁽²⁾	~~Risk-Free Interest Rate—The Company estimated the risk-free interest rate based upon the implied yield available on U.S. Treasury issues using the Treasury bond rate as of the date of grant.~~

⁽³⁾	~~Annual Dividend Payment Per Share (Constant) – The Company assumed a constant annual dividend of $0.30 per share.~~

~~RSUs With Service And Performance Conditions~~

In addition to the RSUs included in the table above summarizing the activity in RSUs under the Plan, the Company issued RSUs with both service and performance conditions. Vesting of performance-based awards, if any, is dependent upon the achievement of certain performance targets. If the performance standards are not achieved, all unvested shares will expire and any accrued expense will be reversed. The Company determines the requisite service period on a case-by-case basis to determine the expense recognition period for non-vested performance based RSUs. The fair value is determined based upon the closing price of the Company’s common stock on the date of grant. The Company applies a quarterly probability assessment in computing its non-cash compensation expense and any change in the estimate is reflected as a cumulative adjustment to expense in the quarter of the change.

~~The following table reflects the activity of RSUs with service and performance conditions:~~

Nine Months Ended
September 30, Year Ended
December 31,
2017 2016
(amounts in thousands, except
per share data)
Reconciliation Of RSUs With Service And Performance

Conditions

Beginning of period balance
—   29
Number of RSUs granted
—   —
Number of RSUs that did not meet criteria
—   (29 )
Number of RSUs vested
—   —

Average fair value of RSUs granted with performance conditions
$ —   $ —

~~As of September 30, 2017, no non-cash compensation expense was recognized for RSUs with performance conditions.~~

~~Option Activity~~

~~The following table provides summary information related to the exercise of stock options:~~

   Nine Months Ended September 30,
Option Exercise Data
   2017    2016
   (amounts in thousands)
Intrinsic value of options exercised
   $ 58    $ 325




Tax benefit from options exercised⁽¹⁾
   $ 23    $ 125




Cash received from exercise price of options exercised
   $ 22    $ 39

⁽¹⁾	~~Amount for prior year excludes impact from suspended income tax benefits and/or valuation allowances.~~

~~The following table presents the option activity during the current period under the Plan:~~

Period Ended Number Of
Options Weighted
Average
Exercise
Price Weighted
Average
Remaining
Contractual
Term (Years) Intrinsic
Value
As Of
September 30,
2017
Options outstanding as of:
December 31, 2016 329,562 $ 1.91
Options granted
—   —
Options exercised
(6,500 ) 3.37
Options forfeited
—   —
Options expired
(500 ) 9.10

Options outstanding as of:
September 30, 2017 322,562 $ 1.87 1.3 $ 3,077,559

Options vested and expected to vest as of:
September 30, 2017 322,562 $ 1.87 1.3 $ 3,077,559

Options vested and exercisable as of:
September 30, 2017 322,562 $ 1.87 1.3 $ 3,077,559

Weighted average remaining recognition period in years
—

Unamortized compensation expense
$ —

~~The following table summarizes significant ranges of outstanding and exercisable options as of the current period:~~

      Options Outstanding    Options Exercisable
      Number Of    Weighted       Number Of
      Options    Average    Weighted    Options    Weighted
Range Of    Outstanding    Remaining    Average    Exercisable    Average
Exercise Prices    September 30,    Contractual    Exercise    September 30,    Exercise
From    To    2017    Life    Price    2017    Price
$ 1.34    $ 1.34    300,437    1.4    $ 1.34    300,437    $ 1.34
$ 2.02    $ 11.78    22,125    1.0    $ 9.08    22,125    $ 9.08





$     1.34    $     11.78    322,562    1.3    $ 1.87    322,562    $ 1.87

~~Recognized Non-Cash Stock-Based Compensation Expense~~

~~The following non-cash stock-based compensation expense, which is related primarily to RSUs, is included in each of the respective line items in our statement of operations:~~

   Nine Months Ended
   September 30,
   2017    2016
   (amounts in thousands)
Station operating expenses
   $ 937    $ 962
Corporate general and administrative expenses
   3,692    3,698




Stock-based compensation expense included in operating expenses
   4,629    4,660
Income tax benefit⁽¹⁾
   1,528    1,637




After-tax stock-based compensation expense
   $ 3,101    $ 3,023

   Three Months Ended
September 30,
   2017    2016
   (amounts in thousands)
Station operating expenses
   $ 360    $ 372
Corporate general and administrative expenses
   1,197    1,270




Stock-based compensation expense included in operating expenses
   1,557    1,642
Income tax benefit⁽¹⁾
   525    888




After-tax stock-based compensation expense
   $ 1,032    $ 754

⁽¹⁾	~~Amount for prior year excludes impact from suspended income tax benefits and/or valuation allowances.~~

~~7. INCOME TAXES~~

~~Tax Rates For The Nine Months And Three Months Ended September 30, 2017~~

The effective income tax rates were 131.7% and 41.5% for the nine months and three months ended September 30, 2017, respectively. These rates were impacted by: (1) merger and acquisition costs that result in an increase in the annual estimated effective tax rate; and (2) a discrete windfall income tax benefit, described below. The annual estimated effective tax rate is estimated to be higher than in previous years primarily due to the amount of merger and acquisition costs forecasted for 2017 as a result of the Merger, as a significant portion of these costs are not deductible for federal and state income tax purposes.

As a result of adopting the amended accounting guidance for stock-based compensation on January 1, 2017, the Company recorded, for the nine months ended September 30, 2017, a discrete windfall income tax benefit of $0.8 million from the vesting of stock-based awards with tax deductions in excess of the compensation expense recorded. Refer to Note 1, Basis of Presentation and Significant Policies, for additional information.

~~Tax Rates For The Nine Months And Three Months Ended September 30, 2016~~

The effective income tax rates were 37.6% and 39.8% for the nine months and three months ended September 30, 2016, respectively. These rates were impacted by discrete income tax benefits from recent legislation in certain single member states that allowed for: (1) the reversal of partial valuation allowances; and (2) a retroactive decrease in deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill. The income tax rate was also impacted by income tax expense from: (i) an increase in deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill; (ii) an adjustment for expenses that are not deductible for tax purposes; and (iii) a tax benefit shortfall associated with share-based awards.

~~Net Deferred Tax Assets And Liabilities~~

As of September 30, 2017, and December 31, 2016, net deferred tax liabilities were $82.7 million and $92.9 million, respectively. The income tax accounting process to determine the deferred tax liabilities involves estimating all temporary differences between the tax and financial reporting bases of the Company’s assets and liabilities, based on enacted tax laws and statutory tax rates applicable to the period in which the differences are expected to affect taxable income. The Company estimated the current exposure by assessing the temporary differences and computing the provision for income taxes by applying the estimated effective tax rate to income.

~~8. FAIR VALUE OF FINANCIAL INSTRUMENTS~~

~~Fair Value Of Financial Instruments Subject To Fair Value Measurements~~

~~Recurring Fair Value Measurements~~

The following table sets forth the Company’s financial assets and/or liabilities that were accounted for at fair value on a recurring basis and are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of fair value and its placement within the fair value hierarchy levels.

   Fair Value Measurements At
Reporting Date
   September 30,    December 31,
Description
   2017    2016
   (amounts in thousands)
Liabilities

Deferred compensation—Level 1⁽¹⁾
   $ 12,097    $ 10,875

⁽¹⁾

The Company’s deferred compensation liability, which is included in other long-term liabilities, is recorded at fair value on a recurring basis. The unfunded plan allows participants to hypothetically invest in various specified investment options. The deferred compensation plan liability is valued at Level 1 as it is based on quoted market prices of the underlying investments.

~~Non-Recurring Fair Value Measurements~~

The Company has certain assets that are measured at fair value on a non-recurring basis and are adjusted to fair value only when the carrying values are more than the fair values. The categorization of the framework used to price the assets is considered Level 3, due to the subjective nature of the unobservable inputs used to determine the fair value.

During the quarters ended June 30, 2017 and 2016, the Company reviewed the fair value of its broadcasting licenses and goodwill, and concluded that its broadcasting licenses were not impaired as the fair value of these assets equaled or exceeded their carrying value. The Company concluded that the carrying value of goodwill allocated to its Boston, Massachusetts market exceeded its fair value. Accordingly, the Company wrote off approximately $0.4 million of goodwill during the second quarter of 2017. Refer to Note 2, Intangible Assets and Goodwill, for additional information. There were no events or changes in circumstances which indicated the Company’s cost-method investments, property and equipment, or other intangible assets may not be recoverable. Accordingly, the Company did not estimate the fair value of these assets.

~~Fair Value Of Financial Instruments Subject To Disclosures~~

The carrying amount of the following assets and liabilities approximates fair value due to the short maturity of these instruments: (1) cash and cash equivalents; (2) accounts receivable; and (3) accounts payable, including accrued liabilities.

~~The following table presents the carrying value of financial instruments and, where practicable, the fair value as of the periods indicated:~~

   September 30,
2017    December 31,
2016
   Carrying
Value    Fair
Value    Carrying
Value    Fair
Value
   (amounts in thousands)
Term B Loan⁽¹⁾
   $ 458,000    $ 459,718    $ 480,000    $ 487,200








Revolver⁽²⁾
   $ 22,500    $ 22,500    $ —      $ —








Other debt⁽³⁾
   $ 74       $ 87

~~The following methods and assumptions were used to estimate the fair value of financial instruments:~~

⁽¹⁾	The Company’s determination of the fair value of the Term B Loan was based on quoted prices for this instrument and is considered a Level 2 measurement as the pricing inputs are other than quoted prices in active markets.

⁽²⁾	The fair value of the Revolver was considered to approximate the carrying value as the interest payments are based on LIBOR rates that reset periodically. The Revolver is considered a Level 2 measurement as the pricing inputs are other than quoted prices in active markets.

⁽³⁾	~~The Company does not believe it is practicable to estimate the fair value of the other debt.~~

~~Cost-Method Investments~~

The Company holds investments in equity securities that are accounted for as cost-method investments. These investments represent its holdings in privately held companies that are not exchange-traded and therefore not supported with observable market prices. The cost-method investments are recognized on the consolidated balance sheet at their cost basis, which represents the amount the Company paid to acquire the investments. The cost-method of accounting is utilized as the Company does not have significant influence over the investees and the fair value of the investees is not readily determinable.

The Company periodically evaluates the carrying value of its cost-method investments, when events and circumstances indicate that the carrying amount of the assets may not be recoverable. The Company considers investee financial performance and other information received from the investee companies, as well as any other available estimates of the fair value of the investee companies in its evaluation.

If certain impairment indicators exist, the Company determines the fair value of its cost-method investments. If the Company determines the carrying value of a cost-method investment exceeds its fair value, and that difference is other than temporary, the Company writes down the value of the cost-method investment to its fair value. The fair value of the cost-method investments are not adjusted if there are no identified adverse events or changes in circumstances that may have a material effect on the fair value of the cost-method investment.

Since its initial date of investment, the Company has not identified any events or changes in circumstances which would require the Company to estimate the fair value of its cost-method investments. Additionally, there have been no returns of capital. As a result, the cost-method investments continue to be presented at their original cost basis within the deferred charges and other assets, net of accumulated amortization line item.

~~There was no material change in the carrying value of the Company’s cost-method investments since the year ended December 31, 2016, other than as described below.~~

On July 26, 2017, the Company purchased a minority ownership interest in DGital Media Inc. (“DGital”), a leading creator of premium, personality-based podcasts and other on-demand audio content for $9.7 million. Subsequent to the Company’s initial investment, DGital rebranded as Cadence13. Under the terms of the purchase agreement, the Company also obtained an option to acquire the remaining ownership interest in Cadence13 in 2021. The Company and Cadence13 entered into a multi-year services agreement under which Cadence13 will dedicate

significant resources to create world-class, original on-demand audio content leveraging the Company’s deep roster of local talent and relationships in the world of sports, news, politics, music, comedy, and technology. Cadence13 will also serve as the Company’s exclusive third party advertisement sales representative for all of its podcasts and other on-demand audio.

~~The following table presents the changes in the Company’s cost-method investments as described above:~~

Cost-Method Investments
Carrying Amount
September 30, December 31,
2017 2016
(amounts in thousands)
Investment balance before cumulative other than temporary impairment as of January 1,
$ 255 $ 255
Accumulated other than temporary impairment as of January 1,
— —

Investment beginning balance after cumulative other than temporary impairment as of January 1,
255 255
Acquisition of interest in a privately held company
9,700 —

Ending period balance
$ 9,955 $ 255

~~9. BUSINESS COMBINATIONS~~

~~The Company consummated~~records acquisitions under the acquisition method of accounting, and allocates the purchase price ~~was allocated~~ to the assets and liabilities based upon their respective fair values as determined as of the acquisition date. Merger and acquisition costs are excluded from the purchase price as these costs are expensed for book purposes and amortized for tax purposes.

2018 WXTU Transaction

On ~~January 6, 2017,~~July 18, 2018, the Company entered into an agreement with Beasley Broadcast Group, Inc. (“Beasley”) to sell certain assets ofWXTU-FM, serving the Philadelphia, Pennsylvania radio market for $38.0 million in cash (the “WXTU Transaction”). The Company also simultaneously entered into a time brokerage agreement (“TBA”) with Beasley where Beasley commenced operations ofWXTU-FM on July 23, 2018. During the period of the TBA, the Company excluded net revenues and station operating expenses associated with operatingWXTU-FM in the Company’s consolidated financial statements. The Company completed this disposition, which was subject to customary regulatory approvals, during the third quarter of 2018 and recognized a gain of approximately $4.4 million.

Based on this timing, the Company’s consolidated financial statements for the three months ended March 31, 2019 do not reflect the results of this divested station, whereas the Company’s consolidated financial statements for the three months ended March 31, 2018 do reflect the results of this divested station.

2018 Jerry Lee Transaction

On September 27, 2018, the Company completed a transaction to acquire ~~four~~the assets ofWBEB-FM, serving the Philadelphia, Pennsylvania radio ~~stations in Charlotte, North Carolina~~market from ~~Beasley Broadcast Group, Inc.~~Jerry Lee Radio, LLC (“~~Beasley”~~Jerry Lee”) for a purchase price of ~~$24~~$57.5 million in ~~cash.~~cash, less certain working capital and other credits (the “Jerry Lee Transaction”). The Company used proceeds from the WXTU Transaction and cash on hand to fund this acquisition. Upon the ~~acquisition.~~ completion of the WTXU Transaction and the Jerry Lee Transaction, the Company will continue to operate six radio stations in the Philadelphia, Pennsylvania market.

On ~~October 17, 2016,~~August 7, 2018, the Company entered into ~~an asset purchase agreement and~~ a TBA with Beasley to operate three of the four radio stations that were held in the Charlotte Trust. On November 1, 2016, the Company commenced operations of the radio stations held in the Charlotte Trust and began operating the fourth station upon closing on the acquisition with Beasley in January 2017.

Jerry Lee. During the period of the TBA, the Company included net revenues, station operating expenses and monthly TBA fees associated with operating ~~these stations~~WBEB-FM in the Company’s consolidated financial statements.

Based on this timing, the Company’s consolidated financial statements for the three months ended March 31, 2019 reflect the results of this acquired station, whereas the Company’s consolidated financial statements for the three months ended March 31, 2018 do not reflect the results of this acquired station.

The allocations presented in the table below are based upon management’s estimate of the fair values using valuation techniques including income, cost and market approaches. In estimating the fair value of the acquired FCC broadcasting licenses, the fair value estimates are based on, but not limited to, expected future revenue and cash flows that assume an expected future growth rate of 1.0% and an estimated discount rate of 9.0%. The gross profit margins utilized were considered appropriate based on management’s expectations and experience in equivalent sized markets. The Company determines the fair value of the broadcasting licenses by relying on a discounted cash flow approach assuming astart-up scenario in which the only assets held by an investor are broadcasting licenses. The Company’s fair value analysis contains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. Any excess of the purchase price over the ~~net~~ assets acquired was reported as goodwill. The Company recorded goodwill on its books, which is fully deductible for income tax purposes. Management believes that this acquisition provides the Company with an opportunity to benefit from operational efficiencies from combining operations of the acquired station with the Company’s existing stations within the Philadelphia market.

The following preliminary purchase price allocations are based upon the valuation of assets ~~and liabilities~~ and these estimates and assumptions are subject to change as the Company obtains additional information during the measurement period, which may be up to one year from the acquisition date. These assets ~~and liabilities~~ pending finalization include intangible ~~assets and liabilities.~~assets. Differences between the preliminary and final valuation could be substantially different from the initial estimates.


			Useful Lives in Years
	Preliminary Value		From		To
	(amounts in thousands)
Assets
Equipment	$	981		3		7

Total tangible property		981

Advertising contracts		477		1		1
Radio broadcasting licenses		27,346		non-amortizing
Goodwill		24,396		non-amortizing
Net working capital		3,234		not applicable

Total intangible and other assets		55,453

Total assets	$	56,434

Preliminary fair value of net assets acquired	$	56,434

~~2016 Disposition~~2018 Emmis Acquisition

~~In March 2016,~~On April 30, 2018, the Company ~~sold certain assets~~completed a transaction to acquire two radio stations in St. Louis, Missouri from Emmis Communications Corporation (“Emmis”) for a purchase price of ~~KRWZ AM in Denver, Colorado, for $3.8~~$15.0 million in ~~cash.~~cash (the “Emmis Acquisition”). The Company ~~believes that~~borrowed under its revolving credit facility (the “Revolver”) to fund the ~~sale~~acquisition. With this acquisition, the Company increased its presence in St. Louis, Missouri, to five radio stations.

On March 1, 2018, the Company entered into an asset purchase agreement and a TBA with Emmis to operate two radio stations. During the period of ~~this~~the TBA, the Company included in net revenues, station operating expenses and monthly TBA fees associated with ~~a marginal market share, did not alter~~operating these stations in the Company’s ~~competitive position~~consolidated financial statements.

Based on this timing, the Company’s consolidated financial statements for the three months ended March 31, 2019 reflect the results of these acquired stations, whereas the Company’s consolidated financial statements for the three months ended March 31, 2018 reflect the results of these acquired stations only for the portion of the period in which the TBA was in effect.

The allocations presented in the ~~market.~~table below are based upon management’s estimate of the fair values using valuation techniques including income, cost and market approaches. In estimating the fair value of the acquired FCC broadcasting licenses, the fair value estimates are based on, but not limited to, expected future revenue and cash flows that assume an expected future growth rate of 1.0% and an estimated discount rate of 9.0%. The gross profit margins utilized were considered appropriate based on management’s expectations and experience in equivalent sized markets. The Company determines the fair value of the broadcasting licenses by relying on a discounted cash flow approach assuming astart-up scenario in which the only assets held by an investor are broadcasting licenses. The Company’s fair value analysis contains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. Any excess of the purchase price over the assets acquired was reported ~~a gain, net~~as goodwill.

The following table reflects the final allocation of ~~expenses, of $0.3 million on~~ the ~~disposition of these assets.~~purchase price to the assets acquired and liabilities assumed.

~~Pending Acquisition of~~


	Final Value
	(amounts in thousands)
Assets
Equipment	$	1,558

Total tangible property		1,558

Advertiser relationships		207
Advertising contracts		114
Radio broadcasting licenses		12,785
Goodwill		332
Other noncurrent assets		4

Total intangible and other assets		13,442

Total assets	$	15,000

Fair value of assets acquired	$	15,000

2017 CBS Radio Business Acquisition

On February 2, 2017, the Company and its wholly-owned subsidiary (“Merger ~~Sub entered into a material definitive agreement with CBS and CBS Radio, and CBS and CBS Radio also~~Sub”), entered into an ~~agreement that provides for the separation~~Agreement and Plan of Merger (the “CBS Radio Merger Agreement”) with CBS Corporation (“CBS”) and its wholly-owned subsidiary CBS Radio ~~from~~ Inc. (“CBS ~~(the “Separation Agreement”~~Radio”)~~, which together provide for the combination of the Company’s business and CBS’s radio business. Prior~~. Pursuant to ~~February 2, 2017, CBS transferred substantially all of the assets and liabilities of CBS’s radio business to CBS Radio.~~

~~At the time of the signing of~~ the CBS Radio Merger Agreement, on February 2, 2017, CBS Radio had two classes of common stock, the Radio Series 1 Common Stock, par value $0.01 per share (the “Radio Series 1 Common Stock”) and the Radio Series 2 Common Stock, par value $0.01 per share (the “Radio Series 2 Common Stock”), collectively, (the “Radio Existing Common Stock”).

Prior to the Merger, CBS and CBS Radio will first complete a series of internal distributions and transactions (collectively, the “Radio Reorganization”). Following the consummation of the Radio Reorganization, CBS will consummate an offer to exchange all of the outstanding shares of Radio Existing Common Stock for outstanding shares of CBS Class B Common Stock (the “Final Distribution”). CBS Broadcasting, Inc. will first distribute (the “First Distribution”) all of the outstanding equity of CBS Radio to Westinghouse CBS Holding Company, Inc. (“Westinghouse”). Westinghouse will then distribute all of the outstanding equity of CBS Radio to CBS (the “Second Distribution”). Following the Second Distribution, CBS Radio will then: (a) combine Radio Series 1 Common Stock and Radio Series 2 Common stock into a single class of common stock, par value $0.01 per share (the “Radio New Common Stock”), (b) authorize the issuance of at least 101,407,494 shares of Radio New Common Stock and (c) effect a stock split of the outstanding shares of Radio New Common Stock, as a result of which, as of immediately prior to the effective time of the Final Distribution, 101,407,494 shares of Radio New Common Stock will be issued and outstanding, all of which will be owned directly by CBS (collectively, (a) through (c), the “Stock Split”).

Subject to the terms and conditions of the CBS Radio Merger Agreement and the Separation Agreement, in the event that holders of CBS Class B Common Stock subscribe for less than all of the outstanding shares of Radio Common Stock held by CBS in the exchange offer, CBS will distribute the remaining outstanding shares of Radio Common Stock held by CBS on a pro rata basis to holders of CBS Common Stock whose shares of CBS Common Stock remain outstanding after consummation of the exchange offer (the “Spin-Off”). The Spin-Off will only occur if the exchange offer is consummated but not fully subscribed, meaning that not all of the outstanding shares of Radio Common Stock held by CBS would be distributed in the exchange offer, in that scenario.

~~Immediately after the consummation of the Final Distribution,~~ Merger Sub ~~will merge~~merged with and into CBS Radio with CBS Radio surviving as the Company’s wholly-owned subsidiary (the “Merger”). On November 13, 2018, the Company changed the name of CBS Radio Inc. to Entercom Media Corp. The parties to the Merger believe that the Merger wastax-free to CBS and its shareholders. The Merger was effected through a ~~wholly owned~~stock for stock Reverse Morris Trust transaction.

On November 17, 2017, the Company acquired the CBS Radio business from CBS to further strengthen its scale and capabilities to compete more effectively with other media for a larger share of advertising dollars. The purchase price was $2.56 billion and consisted of $1.17 billion of total equity consideration and $1.39 billion of assumed debt.

The CBS Radio business acquisition was completed pursuant to the CBS Radio Merger Agreement, dated February 2, 2017, by and among the Company, CBS, CBS Radio, and Merger Sub. On November 17, 2017, (i) Merger Sub was merged with and into CBS Radio, with CBS Radio continuing as the surviving corporation and a direct, wholly-owned subsidiary of the ~~Company. In the Merger, all outstanding shares~~Company and (ii) each share of CBS Radio ~~Common Stock will be~~common stock was converted into ~~the right to receive an equal number of shares~~one share of the Company’s ~~Class A~~ common ~~Stock.~~

It is estimated that the existing Company shareholders will own approximately 28% and CBS Radio shareholders will own approximately 72% of the combined company’s outstanding shares immediately after consummation of the Merger.stock.

The Company ~~will issue~~issued 101,407,494 shares of its Class A common Stock into the ~~Merger.~~former holders of CBS Radio common stock. At the time of the Merger, each outstanding ~~RSU~~restricted stock unit (“RSU”) and stock option with respect to CBS Class B ~~Common Stock~~common stock held by employees of CBS Radio ~~will be~~was canceled and converted into equity awards for the Company’s Class A ~~Common Stock.~~common stock. The conversion ~~will be~~was based on the ratio of the volume-weighted average per share closing prices of CBS stock on the five trading days prior to the ~~effective~~ date of ~~the Merger~~acquisition and the Company’s stock on the five trading days following the ~~effective~~ date of acquisition. Entercom Communications Corp. is considered to be the ~~Merger.~~acquiring company for accounting purposes.

~~In connection~~To complete the Merger, certain divestitures were required by the FCC in order to comply with the ~~Merger,~~FCC’s ownership rules and policies. These divestitures consisted of: (i) the exchange transaction with iHeartMedia, Inc. (“iHeart”); (ii) a station exchange with Beasley; (iii) a cash sale to Bonneville International Corporation (“Bonneville”); and (iv) a cash sale to Educational Media Foundation (“EMF”).

Due to the structure of the transaction, there was nostep-up in tax basis for the assets acquired as the Company assumed the existing tax basis in the assets of CBS ~~Radio received committed financing~~Radio. The absence of ~~up to $500 million of senior secured term loan from the Commitment Parties as an additional tranche under the CBS Radio Credit Agreement. The proceeds of this loan~~astep-up in tax basis will ~~be used to: (1) refinance~~limit the Company’s ~~Credit Facility; (2) redeem~~tax deductions in future years and impacts the ~~Company’s Preferred; and (3) pay fees and expenses~~amount of deferred tax liabilities recorded as part of purchase price accounting. If any of the Internal Distributions or the Final Distribution, each as defined in connection with the refinancing. The committed financing will be an additional tranche under the CBS Radio Credit Agreement. See Note 4, Long-Term Debt, for additional information with respect to this financing.

The total consideration for the Merger is approximately $1.16 billion, based on the Company’s Class A common stock market price per share of $11.45 on September 30, 2017 and the shares to be issued in connection with the Merger. Transaction costs relating to the Merger, including legal and professional fees, of $8.8 million and $24.9 million for the three and nine months ended September 30, 2017, respectively, were expensed as incurred.

If the CBS Radio Merger Agreement, does not qualify as a transaction that is ~~terminated in certain circumstances prior to the consummation~~tax-free for U.S. federal income tax purposes under Section 355 of the ~~transactions contemplated thereby,~~Code or the ~~Company will~~Merger does not qualify as atax-free “reorganization” under Section 368(a) of the Code, including as a result of actions taken in connection with the distributions made by CBS to facilitate the

Merger or as a result of subsequent acquisitions of shares of CBS, Entercom, or CBS Radio, then CBS and/or holders of CBS Common Stock that received Radio Common Stock in the Final Distribution may be required to pay ~~CBS a termination fee of $30 million. Either party may terminate the~~substantial U.S. federal income taxes, and, in certain circumstances, CBS Radio ~~Merger Agreement if~~and Entercom may be required to indemnify CBS for any such tax liability.

2017 Local Marketing Agreement: The Bonneville Transaction

On November 1, 2017, the ~~Merger is not consummated on or before January 31, 2018, subject~~Company assigned assets to ~~extension to May 2, 2018, if~~a trust and the ~~approval of~~trust subsequently entered into two local marketing agreements (“LMAs”) with Bonneville. The LMAs, which were effective upon the ~~FCC has not been obtained or if the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvement Act of 1976 has not occurred by November 2, 2017.~~

~~Upon completion~~closing of the Merger, ~~certain required divestitures~~allowed Bonneville to operate eight radio stations in the San Francisco, California and Sacramento, California markets. Of the eight radio stations operated by Bonneville, three were originally owned by the Company and the ~~debt refinancing described above,~~remaining five were originally owned by CBS Radio. The Company conducted an analysis and determined the assets of the eight stations satisfied the criteria to be presented as assets held for sale. The stations which were acquired from CBS Radio and were never operated by the Company are ~~all expected~~included within discontinued operations. On August 2, 2018, the Company entered into an asset purchase agreement with Bonneville to ~~occur~~dispose of the eight radio stations in the San Francisco, California and Sacramento, California markets for $141.0 million in cash. During the year ended December 31, 2018, the Company closed on this sale, which resulted in a loss of approximately $0.4 million to the Company. Refer to Note 12, Assets Held for Sale and Discontinued Operations, for additional information.

Restructuring Charges

Restructuring charges were expensed as a separate line item in the consolidated statements of operations.

The components of restructuring charges are as follows:


	Three Months Ended March 31,
	2019		2018
	(amounts in thousands)
Costs to exit duplicative contracts	$	—	$	143
Workforce reduction		693		590
Lease abandonment costs		—		257
Other restructuring costs		321		491

Total restructuring charges	$	1,014	$	1,481

Restructuring Plan

During the fourth quarter of 2017, the ~~combined company will be named Entercom Communications Corp. and will be listed on~~Company initiated a restructuring plan as a result of the ~~NYSE under~~integration of the ~~current trading symbol for the Company’s Class A Common Stock, “ETM”.~~

~~Merger And Acquisition Costs~~

~~The Company records merger and acquisition costs whether or not an acquisition occurs. These costs consist primarily of legal, professional and advisory services and could include restructuring costs.~~

~~There were merger and acquisition costs incurred during the first three quarters of 2017 primarily~~CBS Radio stations acquired in ~~connection with the announced CBS Merger.~~

   Nine Months Ended
September 30,
   2017    2016
   (amounts in thousands)
Merger and acquisition costs
   $ 24,925    $ 670




   Three Months Ended
September 30,
   2017    2016
   (amounts in thousands)
Merger and acquisition costs
   $ 8,825    $ 670

~~Restructuring Costs~~

November 2017. The restructuring plan ~~related to the Company’s acquisitions in 2015~~ included: ~~(1) costs associated with exiting contractual vendor obligations as these obligations were duplicative; (2)~~(i) a workforce reduction and realignment charges that includedone-time termination benefits and related costs; ~~and (3)~~(ii) lease abandonment ~~costs. The lease abandonment~~costs; and (iii) costs associated with realigning radio stations within the overlap markets between CBS Radio and the Company. A portion of unpaid restructuring charges as of March 31, 2019 were including in accrued expenses as these expenses are ~~longer-term as the lease expires~~expected to be paid in ~~June 2026.~~ less than one year.

The estimated amount of unpaid restructuring charges as of ~~September 30, 2017, after excluding the lease abandonment liability as of September 30, 2017, was included~~March 31, 2019 includes amounts in accrued expenses ~~as most expenses~~that are expected to be paid ~~within~~in less than one ~~year.~~year and long-term restructuring costs for lease abandonment costs covering the remainingnon-cancellable lease term.


	Three Months Ended March 31, 2019			Twelve Months Ended December 31, 2018
	(amounts in thousands)
Restructuring charges and lease abandonment costs, beginning balance	$	7,077		$	16,086
Additions resulting from the integration of CBS Radio		1,014			5,830
Payments		(2,659	)		(14,839	)

Restructuring charges and lease abandonment costs unpaid and outstanding		5,432			7,077
Restructuring charges and lease abandonment costs—noncurrent portion		(650	)		(988	)

Restructuring charges and lease abandonment costs—current portion	$	4,782		$	6,089

Integration Costs

Nine Months Ended Year Ended
September 30, December 31,
2017 2016
(amounts in thousands)
Restructuring charges and lease abandonment costs, beginning balance
$ 650 $ 1,686
Additions through accruals
— —
Deductions through payments
(56 ) (1,036 )

Lease abandonment costs unpaid and outstanding
594 650
Less lease abandonment costs over a long-term period
(521 ) (576 )

Lease abandonment costs over a short-term period
$ 73 $ 74

The Company incurred integration costs of $1.1 million and $9.7 million during the three months ended March 31, 2019 and March 31, 2018, respectively. Integration costs were expensed as a separate line item in the consolidated statements of operations. These costs primarily relate to change management consultants and technology-related costs incurred subsequent to the Merger.

Unaudited Pro Forma Summary Of Financial Information

The following unaudited pro forma information ~~presents~~for the ~~consolidated results of operations as if~~three months ended March 31, 2019 and 2018 assumes that the ~~2017 acquisition~~acquisitions in ~~Charlotte, North Carolina,~~2018 had occurred as of January 1, ~~2016, after giving~~2017. Refer to information within this Note 2, Business Combinations, and to the financial statements and related notes included in the Company’s audited financial statements as of and for the year ended December 31, 2018, and filed with the SEC on February 27, 2019, for a description of the Company’s acquisition and disposition activities. The unaudited pro forma information presented gives effect to certain adjustments, including: ~~(1)~~(i) depreciation and amortization of assets; ~~(2)~~(ii) change in the effective tax rate; ~~and (3)~~(iii) merger and acquisition ~~costs. The~~costs; and (iv) interest expense on any debt incurred to fund the acquisitions which would have been incurred had such acquisitions had been consummated at an earlier time.

For purposes of this presentation, the pro forma data: (i) includes revenue and earnings of stations divested to Bonneville during 2018; and (ii) includes revenue and earnings of the station divested to Beasley during 2018.

This unaudited pro forma information ~~does not exclude the pro forma impact of any dispositions.~~has been prepared based on estimates and assumptions, which management believes are reasonable. These unaudited pro forma results have been prepared for comparative purposes only and do not purport to be indicative of what would have occurred had the acquisitions been made as of that date or results which may occur in the future.


	Three Months Ended March 31,
	2019		2018
	(amounts in thousands, except per share data)
	Actual		Pro Forma
Net revenues	$	309,005	$	305,425

Income (loss) from continuing operations	$	3,125	$	(13,681	)

Income (loss) from discontinued operations	$	—	$	328

Net income (loss) available to the Company	$	3,125	$	(13,353	)

Net income (loss) available to common shareholders	$	3,125	$	(13,353	)

Income (loss) from continuing operations per common share—basic	$	0.02	$	(0.10	)

Income (loss) from discontinued operations per common share - basic	$	—	$	—

Net income (loss) available to common shareholders per common share - basic	$	0.02	$	(0.10	)

Income (loss) from continuing operations per common share - diluted	$	0.02	$	(0.10	)

Income (loss) from discontinued operations per common share - diluted	$	—	$	—

Net income (loss) available to common shareholders per common share - diluted	$	0.02	$	(0.10	)

Weighted shares outstanding basic		138,099,180		138,939,309

Weighted shares outstanding diluted		138,523,371		138,939,309

~~10.~~

REVENUE

Nature Of Goods And Services

The following is a description of principal activities from which the Company generates its revenue.

The Company generates revenue from the sale to advertisers of various services and products, including but not limited to: (i) commercial broadcast time; (ii) digital advertising; (iii) promotional and sponsorship event revenue;(iv) e-commerce revenue; and (v) trade and barter revenue. Services and products may be sold separately or in bundled packages. The typical length of a contract for service is less than 12 months.

Revenue is recognized when or as performance obligations under the terms of a contract with customers are satisfied. This typically occurs at the point in time that advertisements are broadcast, marketing services are provided, or as an event occurs. For commercial broadcast time and digital advertising, the Company recognizes revenue at the point in time when the advertisement is broadcast. Fore-commerce revenue transactions, revenue is recognized as each third party sale is made and the advertisers’ good or service is transferred to the end customer. For trade and barter transactions, revenue is recognized at the point in time when the promotional advertising is aired.

For bundled packages, the Company accounts for each product or performance obligation separately if they are distinct. A product or service is distinct if it is separately identifiable from other items in the bundled package and if a customer can benefit from it on its own or with other resources that are readily available to the customer. The consideration is allocated between separate products and services in a bundle based on their stand-alone selling prices. The stand-alone selling prices are determined based on the prices at which the Company separately sells the commercial broadcast time, digital advertising, or digital product and marketing solutions.

Broadcast Revenues

Commercial broadcast time - The Company sellsair-time to advertisers and broadcasts commercials at agreed upon dates and times. The Company’s performance obligations are broadcasting advertisements for advertisers at specifically identifiable days and dayparts. The amount of consideration the Company receives and revenue it recognizes is fixed based upon contractually agreed upon rates. The Company recognizes revenue at a point in time when the advertisements are broadcast and the performance obligations are satisfied. Revenues are recorded on a net basis, after the deduction of advertising agency fees by the advertising agencies.

Digital advertising - The Company sells digital marketing services to advertisers. The Company’s performance obligations are providing broadcasting advertisements and integrated marketing services for advertisers. The Company recognizes revenue at a point in time when the advertisements are broadcast, the marketing services are provided and the performance obligations are satisfied. Revenues are recorded on a gross basis as the Company acts as a principal in these transactions.

Event And Other Revenues

Promotional and Sponsorship Event revenue - The Company provides promotional advertising to advertisers in exchange for cash proceeds from ticket sales. Performance obligations are broadcasting advertisements for advertisers’ events at specifically identifiable days and dayparts. The Company also sells sponsorships to advertisers at various local events. Performance obligations include providing advertising space at the Company’s event. The Company recognizes revenue at a point in time, as the event occurs. Revenues are recorded on a net basis when the Company is not the primary party hosting the event and acts as an agent in these transactions.

E-Commerce revenue - The Company sells discount certificates to listeners on its websites. Listeners purchase goods and services from the advertiser at a discount to the fair value of the merchandise or service. Performance obligations include the promotion of advertisers’ discount offers on the Company’s website as well as revenue share payments to the advertiser. The Company records revenue on a net basis as it acts as an agent in these transactions.

Trade And Barter Revenues

Trade and barter – The Company provides advertising broadcast time in exchange for certain products, supplies, and services. The term of the exchanges generally permit the Company to preempt such broadcast time in favor of advertisers who purchase time on regular terms. Other than network barter programming, which is reflected on a net basis, the Company includes the value of such exchanges in both broadcasting net revenues and station operating expenses. Trade and barter value is based upon management’s estimate of the fair value of the products, supplies and services received.

Contract Balances

Refer to the table below for information about receivables, contract assets and contract liabilities from contracts with customers. Accounts receivable balances in the table below exclude other receivables that are not generated from contracts with customers. These amounts are $9.1 million and $11.8 million as of March 31, 2019 and December 31, 2018, respectively.


Description	March 31, 2019		December 31, 2018
	(amounts in thousands)
Receivables, included in “Accounts receivable net of allowance for doubtful accounts”	$	260,857	$	330,983
Unearned revenue - current		21,208		22,692
Unearned revenue - noncurrent		700		1,138

Changes in Contract Balances

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables, and customer advances and deposits (unearned revenue) on the Company’s consolidated balance sheet. At times, however, the Company receives advance payments or deposits from its customers before revenue is recognized, resulting in contract liabilities. The contract liabilities primarily relate to the advance consideration received from customers on certain contracts. For these contracts, revenue is recognized in a manner that is consistent with the satisfaction of the underlying performance obligations. The contract liabilities are reported on the consolidated balance sheet on acontract-by-contract basis at the end of each respective reporting period within the other current liabilities and other long-term liabilities line items.

Significant changes in the contract liabilities balances during the period are as follows:


	Three Months Ended March 31, 2019
Description	Unearned Revenue
	(amounts in thousands)
Beginning balance on January 1, 2019	$	23,830
Revenue recognized during the period that was included in the beginning balance of contract liabilities		(7,438	)
Additional amounts recognized during period		5,516

Ending balance	$	21,908

Disaggregation of revenue

The following table presents the Company’s revenues disaggregated by revenue source:


	Three Months Ended
	March 31,
	2019		2018
Revenue by Source	(amounts in thousands)
Broadcast revenues	$	284,465	$	274,453
Event and other revenues		19,526		22,609
Trade and barter revenues		5,014		3,498

Net revenues	$	309,005	$	300,560

Performance obligations

A performance obligation is a promise in a contract with a customer to transfer a good or service to the customer, and is the unit of account under this guidance. A contract’s transaction price is allocated to each distinct performance obligation and is recognized as revenue when the performance obligation is satisfied. Some of the Company’s contracts have one performance obligation which requires no allocation. For other contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation using its best estimate of the standalone selling price of each distinct good or service in the contract.

The Company’s performance obligations are either satisfied at a point in time or are satisfied over a period of time. As the Company’s inputs are expended evenly throughout the performance period, the Company recognizes revenue on a straight-line basis over the life of a contract. For performance obligations that are satisfied at a point in time, the Company recognizes revenue when an advertisement is aired and the customer has received the benefits of advertising.

Performance obligations for all products and services, with the exception of event revenues, are satisfied over the term of the contracts, which are typically less than 12 months.

Practical expedients

As a practical expedient, when the period of time between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less, the Company will not adjust the promised amount of consideration for the effects of a significant financing component.

The Company elected to apply the practical expedient which allows it to not disclose information about remaining performance obligations that have original expected durations of one year or less. The Company has contracts with customers which will result in the recognition of revenue beyond one year. From these contracts, the Company expects to recognize $0.7 million of revenue in excess of one year.

The Company also elected to apply the practical expedient which allows it to not disclose the amount of the transaction price allocated to the remaining performance obligations and an explanation of when the Company expects to recognize that amount as revenue for all reporting periods presented before January 1, 2018.

The Company elected to apply the practical expedient which allows the Company to recognize the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs are included in station operating expenses on the consolidated statements of operations.

Significant judgments

For performance obligations satisfied at a point in time, the Company does not estimate when a customer obtains control of the promised goods or services. Rather, the Company recognizes revenues at the point in time in which performance obligations are satisfied.

The Company records a provision against revenues for estimated sales adjustments when information indicates allowances are required.

For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation using its best estimate of the standalone selling price of each distinct good or service in the contract.

For all revenue streams with the exception of barter revenues, the transaction price is contractually determined. Accordingly, no estimates are required and there is no variable consideration. For trade and barter revenues, the Company estimates the consideration by estimating the fair value of the goods and services received.

Net revenues from network barter programming have historically been recorded on a net basis. This treatment will continue to be the Company’s policy under the amended accounting guidance for revenue recognition.

4. LEASES

Leasing Transactions

The Company’s leased assets primarily include real estate, broadcasting towers and equipment. The Company’s leases have remaining lease terms of less than 1 year up to 30 years, some of which include one or more options to extend the leases, with renewal terms up to fifteen years and some of which include options to terminate the leases within the next year. Many of the Company’s leases include options to extend the terms of the agreements. Generally, renewal options are excluded when calculating the lease liabilities, as the Company does not consider the exercise of such options to be reasonably certain. Unless a renewal options is considered reasonably assured, the optional terms and related payments are not included within the lease liability. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company’s operating leases are reflected on the Company’s balance sheet within the Operating leaseright-of-use assets line item and the related current andnon-current liabilities are included within the Operating lease liabilities and Operating lease liabilities, net of current portion line items, respectively. ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from leases. Operating lease ROU assets and liabilities are recognized at commencement date based upon the present value of lease payments over the respective lease term. Lease expense is recognized on a straight-line basis over the lease term.

As the rate implicit in the lease is not readily determinable for the Company’s operating leases, the Company generally uses an incremental borrowing rate based upon information available at the commencement date to determine the present value of future lease payments. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments in similar economic environment. In order to measure the operating lease liability and determine the present value of lease payments, the Company estimated what the incremental borrowing rate was for each lease using an applicable treasury rate compatible to the remaining life of the lease and the applicable margin for the Company’s Revolver.

In determining whether a contract is or contains a lease at inception of a contract, the Company considers all relevant facts and circumstances, including whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. This consideration involves judgment with respect to whether the Company has the right to obtain substantially all of the economic benefits from the use of the identified asset and whether the Company has the right to direct the use of the identified asset.

On January 1, 2019, the Company implemented the new leasing guidance using a modified retrospective approach with a cumulative-effect adjustment to its accumulated deficit of $4.7 million, net of taxes of $1.7 million.

Practical Expedients

The Company elected the practical expedient which allows it to: (i) apply the new lease requirements at the effective date and recognize a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption; (ii) continue to report comparative periods presented in the financial statements in the period of adoption under the former U.S. GAAP; and (iii) provide the required disclosures under former U.S. GAAP for all periods presented under former U.S. GAAP.

The Company elected the package of practical expedients, which were applied consistently to all of its leases, and enable it to not reassess: (i) whether any expired or existing contracts contain leases; (ii) the lease classification for any expired or existing leases; and (iii) initial direct costs for any existing leases.

As a practical expedient, the Company may choose not to separate nonlease components from lease components as an accounting policy election by class of underlying asset. The Company elected this practical expedient by all classes of underlying assets in instances where leases contain common area maintenance. In certain leases, the right to control the use of an asset that meets the lease criteria is combined with the related common area maintenance services provided under the contract into a single lease component.

As an accounting policy election, the Company elected not to apply the recognition requirements to short-term leases for all underlying classes of assets. For these leases which have a term of twelve months or less at lease inception, the Company will recognize the lease payments in profit or loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for these payments is incurred.

Lease Expense

The components of lease expense were as follows:


Lease Cost	Three Months Ended March 31, 2019
	(amounts in thousands)
Operating lease cost	$	12,468
Variable lease cost		2,052
Short-term lease cost		98

Total lease cost	$	14,618

Supplemental Cash Flow

Supplemental cash flow information related to leases was as follows:


Description	Three Months Ended March 31, 2019
	(amounts in thousands)
Cash paid for amounts included in measurement of lease liabilities
Operating cash flows from operating leases	$	13,109
Right-of-use assets obtained in exchange for lease obligations
Operating leases⁽¹⁾	$	307,618

(1)	ROU assets obtained in exchange for lease obligations include transition liabilities upon implementation of the amended leasing guidance, as well as new leases entered into during the three months ended March 31, 2019.

Balance Sheet

Supplemental balance sheet information related to leases was as follows:


Description	March 31, 2019
	(amounts in thousands)
Operating Leases
Operating Leasesright-of-use assets	$	293,638
Operating lease liabilities (current)	$	37,434
Operating lease liabilities (noncurrent)		275,739

Total operating lease liabilities	$	313,173


Weighted Average Remaining Lease Term
Operating leases			9 years
Weighted Average Discount Rate
Operating leases			4.9%

Maturities

The aggregate maturities of the Company’s lease liabilities are as follows:


	Lease Maturities
	Operating Leases
	(amounts in thousands)
Years ending December 31:
Remainder of 2019	$	38,695
2020		51,819
2021		48,116
2022		42,763
2023		39,563
Thereafter		168,387

Total lease payments	$	389,343

Less: imputed interest		(76,170	)

Total	$	313,173

As of March 31, 2019, the Company has not entered into any leases that have not yet commenced.

The aggregate maturities of the Company’s lease liabilities as of December 31, 2018, which were based on the former accounting guidance for leases, were as follows:


	Lease Maturities
	Operating Leases
	(amounts in thousands)
Years ending December 31:
2019	$	51,375
2020		50,504
2021		46,847
2022		41,457
2023		38,230
Thereafter		165,905

Total lease payments	$	394,318

5. INTANGIBLE ASSETS AND GOODWILL

Goodwill and certain intangible assets are not amortized for book purposes. They may be, however, amortized for tax purposes. The Company accounts for its acquired broadcasting licenses as indefinite-lived intangible assets and, similar to goodwill, these assets are reviewed at least annually for impairment. At the time of each review, if the fair value is less than the carrying value of the reporting unit, then a charge is recorded to the results of operations.

The following table presents the changes in the carrying value of broadcasting licenses. Refer to Note 12, Assets Held For Sale And Discontinued Operations, for additional information.


	Broadcasting Licenses Carrying Amount
	March 31, 2019			December 31, 2018
	(amounts in thousands)
Broadcasting licenses balance as of January 1,	$	2,516,625		$	2,649,959
Acquisition of radio stations - Emmis Acquisition		—			12,785
Acquisition of a radio station - Jerry Lee Transaction		—			27,346
Loss on impairment		—			(148,564	)
Disposition of a radio station - WXTU Transaction		—			(24,901	)
Assets held for sale - (See Note 12)		(17,135	)		—

Ending period balance	$	2,499,490		$	2,516,625

The following table presents the changes in goodwill. Refer to Note 12, Assets Held For Sale And Discontinued Operations, for additional information.


	Goodwill Carrying Amount
	March 31, 2019			December 31, 2018
	(amounts in thousands)
Goodwill balance before cumulative loss on impairment as of January 1,	$	982,663		$	988,056
Accumulated loss on impairment as of January 1,		(443,194	)		(126,056	)

Goodwill beginning balance after cumulative loss on impairment as of January 1,		539,469			862,000
Loss on impairment during year		—			(317,138	)
Disposition of a radio station - WXTU Transaction		—			(8,623	)
Measurement period adjustments to acquired goodwill		—			(21,498	)
Acquisition of radio stations - Emmis Acquisition		—			332
Acquisition of a radio station - Jerry Lee Transaction		—			24,396
Assets held for sale - (See Note 12)		(4,862	)		—

Ending period balance	$	534,607		$	539,469

Broadcasting Licenses Impairment Test

There were no events or circumstances since the Company’s prior year fourth quarter interim broadcasting licenses impairment test that indicated an interim review of broadcasting licenses was required.

Goodwill Impairment Test

The Company performs its annual goodwill impairment test during the second quarter of each year by assessing goodwill for its single reporting unit on a consolidated basis.

There were no events or circumstances since the Company’s prior year fourth quarter interim goodwill impairment test that indicated an interim review of goodwill was required.

6.	OTHER CURRENT LIABILITIES

Other current liabilities consist of the following as of the periods indicated:


	Other Current Liabilities
	March 31, 2019		December 31, 2018
	(amounts in thousands)
Accrued compensation	$	32,618	$	31,192
Accounts receivable credits		5,101		5,743
Advertiser obligations		7,046		4,190
Accrued interest payable		12,705		6,007
Unearned revenue		21,208		22,692
Unfavorable lease liabilities		—		2,852
Unfavorable sports liabilities		4,634		4,634
Accrued benefits		8,183		8,646
Non-income tax liabilities		6,662		6,748
Income taxes payable		11,357		10,558
Other		4,977		15,176

Total other current liabilities	$	114,491	$	118,438

During the third quarter of 2018, the Company disposed of certain property that the Company considered as surplus to its operations and that resulted in significant gains reportable for tax purposes. Upon the successful completion of a like-kind exchange under Section 1031 of the Code, a portion of the income taxes payable generated from these gains were reclassified to a deferred tax liability. Refer to Note 14, Contingencies And Commitments, for additional information.

7.	LONG-TERM DEBT

(A) Senior Debt

The Credit Facility

On November 17, 2017, in connection with the Merger, the Company refinanced its previously outstanding indebtedness and also assumed CBS Radio’s outstanding indebtedness. As a result of the refinancing activity and the Merger, the Company’s outstanding Credit Facility is comprised of the Revolver and a term loan component (the “TermB-1 Loan”).

The $250.0 million Revolver has a maturity date of November 17, 2022. The amount available under the Revolver, which includes the impact of outstanding letters of credit, was $244.1 million as of March 31, 2019.

The TermB-1 Loan has a maturity date of November 17, 2024. The TermB-1 Loan amortizes: (i) with equal quarterly installments of principal in annual amounts equal to 1.0% of the original principal amount of the TermB-1 Loan; and (ii) mandatory yearly prepayments based upon a percentage of Excess Cash Flow as defined in the agreement.

The TermB-1 Loan requires mandatory prepayments equal to a percentage of Excess Cash Flow, as defined within the agreement, subject to incremental step-downs, depending on the Consolidated Net Secured Leverage Ratio as defined in the agreement. The Excess Cash Flow payment, if any, is due in the first quarter of each year, and is based on the Excess Cash Flow and Consolidated Net Secured Leverage Ratio for the prior year. Because the Company made voluntary prepayments against the TermB-1 Loan in 2018, which may be applied toward the Excess Cash Flow payment, no Excess Cash Flow payment was due in the first quarter of 2019.

The Company expects to use the Revolver to: (i) provide for working capital; and (ii) provide for general corporate purposes, including capital expenditures and any or all of the following (subject to certain restrictions): repurchase of Class A common stock, dividends, investments and acquisitions. In addition, the Credit Facility is secured by a lien on substantially all of the assets (including material real property) of Entercom Media Corp. and its subsidiaries with limited exclusions. All of the Company’s subsidiaries, jointly and severally guaranteed the Credit Facility. The assets securing the Credit Facility are subject to customary release provisions which would enable the Company to sell such assets free and clear of encumbrance, subject to certain conditions and exceptions.

The Credit Facility has usual and customary covenants including, but not limited to, a net secured leverage ratio, restricted payments and the incurrence of additional debt. Specifically, the Credit Facility requires the Company to comply with a certain financial covenant which is a defined term within the agreement, including a maximum Consolidated Net Secured Leverage Ratio that cannot exceed 4.0 times at March 31, 2019. In certain circumstances, if the Company consummates additional acquisition activity permitted under the terms of the Credit Facility, the Consolidated Net Secured Leverage Ratio will be increased to 4.5 times for a one year period following the consummation of such permitted acquisition. As of March 31, 2019, the Company’s Consolidated Net Secured Leverage Ratio was 3.3 times.

Failure to comply with the Company’s financial covenant or other terms of its Credit Facility and any subsequent failure to negotiate and obtain any required relief from its lenders could result in a default under the Company’s Credit Facility. Any event of default could have a material adverse effect on the Company’s business and financial condition. The acceleration of the Company’s debt repayment could have a material adverse effect on its business. The Company may seek from time to time to amend its Credit Facility or obtain other funding or additional funding, which may result in higher interest rates.

Management believes that over the next 12 months, the Company can continue to maintain compliance with its financial covenant. The Company’s operating cash flow is positive, and management believes that it is adequate to fund the Company’s operating needs and mandatory debt repayments under the Company’s Credit Facility. As of March 31, 2019, the Company is in compliance with the financial covenant and all other terms of the Credit Facility in all material respects. The Company’s ability to maintain compliance with its covenant is highly dependent on its results of operations.

Management believes that cash on hand, borrowing capacity from the Revolver and cash from operating activities will be sufficient to permit the Company to meet its liquidity requirements over the next 12 months, including its debt repayments. The cash available from the Revolver is dependent on the Company’s Consolidated Net Secured Leverage Ratio at the time of such borrowing.

Long-term debt was comprised of the following as of March 31, 2019:


	Long-Term Debt
	March 31, 2019			December 31, 2018
	(amounts in thousands)
Credit Facility
Revolver, due November 17, 2022	$	—		$	180,000
TermB-1 Loan, due November 17, 2024		1,291,700			1,291,700
Plus unamortized premium		2,362			2,470

	1,294,062			1,474,170

Senior Notes
7.250% senior unsecured notes, due October 17, 2024		400,000			400,000
Plus unamortized premium		13,551			14,158

		413,551			414,158

Other Debt
Other		889			912

Total debt before deferred financing costs		1,708,502			1,889,240
Current amount of long-term debt		—			—
Deferred financing costs (excludes the revolving credit)		(16,244	)		(17,037	)

Total long-term debt, net of current debt	$	1,692,258		$	1,872,203

Outstanding standby letters of credit	$	5,862		$	5,862

(B) Senior Unsecured Debt

The Senior Notes

Simultaneously with entering into the Merger and assuming the Credit Facility on November 17, 2017, the Company also assumed the 7.250% unsecured senior notes (the “Senior Notes”) that were subsequently modified and mature on October 17, 2024 in the amount of $400.0 million. The Senior Notes were originally issued by CBS Radio (now Entercom Media Corp) on October 17, 2016. The deferred financing costs and debt premium on the Senior Notes will be amortized over the term under the effective interest rate method. As of any reporting period, the amount of any unamortized debt finance costs and debt premium costs are reflected on the balance sheet as a subtraction and an addition to the $400.0 million liability, respectively.

Interest on the Senior Notes accrues at the rate of 7.250% per annum and is payable semi-annually in arrears on May 1 and November 1 of each year.

The components of net interest expense are as follows:


	Net Interest Expense
	Three Months Ended March 31,
	2019			2018
	(amounts in thousands)
Interest expense	$	25,734		$	23,334
Amortization of deferred financing costs		801			795
Amortization of original issue discount (premium) of senior notes		(715	)		(716	)
Interest income and other investment income		(600	)		(9	)

Total net interest expense	$	25,220		$	23,404

8.	NET INCOME (LOSS) PER COMMON SHARE

The following table presents the computations of basic and diluted net income (loss) per share:


	Three Months Ended March 31,
	2019		2018
	(amounts in thousands except per share data)
Basic Income (Loss) Per Share
Numerator
Net income available to common shareholders from continuing operations	$	3,125	$	(14,206	)
Income (loss) from discontinued operations, net of tax		—		328

Net income (loss) available to common shareholders	$	3,125	$	(13,878	)

Denominator
Basic weighted average shares outstanding		138,099		138,939

Net Income (Loss) Per Common Share - Basic:
Net income (loss) from continuing operations per share available to common shareholders - Basic	$	0.02	$	(0.10	)

Net income (loss) from discontinued operations per share available to common shareholders - Basic		—		—

Net income (loss) per share available to common shareholders - Basic	$	0.02	$	(0.10	)

Diluted Income (Loss) Per Share
Numerator
Net income available to common shareholders from continuing operations	$	3,125	$	(14,206	)
Income (loss) from discontinued operations, net of tax		—		328

Net income (loss) available to common shareholders	$	3,125	$	(13,878	)

Denominator
Basic weighted average shares outstanding		138,099		138,939
Effect of RSUs and options under the treasury stock method		424		—

Diluted weighted average shares outstanding		138,523		138,939

Net Income (Loss) Per Common Share - Diluted:
Net income (loss) from continuing operations per share available to common shareholders - Diluted	$	0.02	$	(0.10	)

Net income (loss) from discontinued operations per share available to common shareholders - Diluted		—		—

Net income (loss) per share available to common shareholders - Diluted	$	0.02	$	(0.10	)

Disclosure of Anti-Dilutive Shares

The following table presents those shares excluded as they were anti-dilutive:


	Three Months Ended
	March 31,
Impact Of Equity Issuances	2019		2018
	(amounts in thousands, except per share data)
Shares excluded as anti-dilutive under the treasury stock method:
Options		553		367

Price range of options: from	$	6.43	$	9.66

Price range of options: to	$	13.98	$	13.98

RSUs with service conditions		1,666		—

RSUs excluded with service and market conditions as market conditions not met		220		226

Excluded shares as anti-dilutive when reporting a net loss		—		1,313

9.	SHARE-BASED COMPENSATION

Under the Entercom Equity Compensation Plan (the “Plan”), the Company is authorized to issue share-based compensation awards to key employees, directors and consultants.

Restricted Stock Units (“RSUs”) Activity

The following is a summary of the changes in RSUs under the Plan during the current period:


	Period Ended		Number of Restricted Stock Units			Weighted Average Purchase Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value as of March 31, 2019
	(amounts in thousands)
RSUs outstanding as of:		December 31, 2018		3,685
RSUs awarded				1,489
RSUs released				(636	)
RSUs forfeited				(83	)

RSUs outstanding as of:		March 31, 2019		4,455		$	—		1.6	$	23,350

RSUs vested and expected to vest as of:		March 31, 2019		4,455		$	—		1.6	$	23,347

RSUs exercisable (vested and deferred) as of:		March 31, 2019		41		$	—		—	$	217

Weighted average remaining recognition period in years				2.5

Unamortized compensation expense			$	27,619

RSUs With Service and Market Conditions

The Company issued RSUs with service and market conditions that are included in the table above. These shares vest if: (i) the Company’s stock achieves certain shareholder performance targets over a defined measurement period; and (ii) the employee fulfills a minimum service period. The compensation expense is recognized even if the market conditions are not satisfied and are only reversed in the event the service period is not met, as all of the conditions need to be satisfied. These RSUs are amortized over the longest of the explicit, implicit or derived service periods, which range from approximately one to three years.


	Three Months Ended March 31, 2019			Year Ended December 31, 2018
	(amounts in thousands, except per share data)
Reconciliation of RSUs with Service And Market Conditions
Beginning of period balance		226			650
Number of RSUs granted		—			—
Number of RSUs forfeited		(6	)		(110	)
Number of RSUs vested		—			(314	)

End of period balance		220			226

Weighted average fair value of RSUs granted with market conditions	$	—		$	—

Option Activity

The following table provides summary information related to the exercise of stock options:


	Three Months Ended March 31,
Option Exercise Data	2019		2018
	(amounts in thousands)
Intrinsic value of options exercised	$	1,272	$	101

Tax benefit from options exercised⁽¹⁾	$	73	$	27

Cash received from exercise price of options exercised	$	242	$	13

⁽¹⁾	Amounts exclude any impact from any compensation expense subject to Section 162(m) of the Code, which is nondeductible for income tax purposes.

The following table presents the option activity during the current period under the Plan:


	Period Ended		Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Intrinsic Value as of March 31, 2019
Options outstanding as of:		December 31, 2018		755,210		$	9.42
Options granted				—			—
Options exercised				(180,300	)		1.34
Options forfeited				—			—
Options expired				(24,828	)		11.69

Options outstanding as of:		March 31, 2019		550,082		$	11.97		1.6	$	2,450

Options vested and expected to vest as of:		March 31, 2019		550,082		$	11.97		1.6	$	2,450

Options vested and exercisable as of:		March 31, 2019		550,082		$	11.97		1.6	$	2,450

Weighted average remaining recognition period in years				—

Unamortized compensation expense			$	—

The following table summarizes significant ranges of outstanding and exercisable options as of the current period:


				Options Outstanding						Options Exercisable
Range of Exercise Prices				Number of Options Outstanding March 31, 2019		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number of Options Exercisable March 31, 2019		Weighted Average Exercise Price
From		To		Number of Options Outstanding March 31, 2019		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number of Options Exercisable March 31, 2019		Weighted Average Exercise Price
$	4.76	$	9.66		209,375		1.6	$	9.50		209,375	$	9.50
$	13.11	$	13.98		340,707		1.6	$	13.48		340,707	$	13.48

$	4.76	$	13.98		550,082		1.6	$	11.97		550,082	$	11.97

RecognizedNon-Cash Stock-Based Compensation Expense

The followingnon-cash stock-based compensation expense, which is related primarily to RSUs, is included in each of the respective line items in the Company’s statement of operations:


	Three Months Ended March 31,
	2019		2018
	(amounts in thousands)
Station operating expenses	$	1,416	$	1,958
Corporate general and administrative expenses		2,157		1,955

Stock-based compensation expense included in operating expenses		3,573		3,913
Income tax benefit⁽¹⁾		748		816

After-tax stock-based compensation expense	$	2,825	$	3,097

⁽¹⁾	Amounts exclude impact from any compensation expense subject to Section 162(m) of the Code, which is nondeductible for income tax purposes.

10.	INCOME TAXES

Tax Rate For The Three Months Ended March 31, 2019

The effective income tax rate was 39.5% which was determined using a forecasted rate based upon taxable income for the year. The effective income tax rate is typically higher in the first quarter of the year primarily due to: (i) the seasonality of the business which results in a lower reported figure for income before income taxes; and (ii) the disproportionate impact that discrete items may have on such lower reported income before income taxes figures.

Tax Rate For The Three Months Ended March 31, 2018

The effective income tax rate was 19.8%, which was determined using a forecasted rate based upon taxable income for the year. The income tax rate was estimated to be lower than in previous years primarily due to: (i) an income tax benefit resulting from the Tax Cuts and Jobs Act that was enacted on December 22, 2017 which reduced the U.S. federal corporate tax rate; and (ii) a reduction innon-deductible transaction costs in 2018 due to the closing of the Merger on November 17, 2017.

Net Deferred Tax Assets And Liabilities

As of March 31, 2019, and December 31, 2018, net deferred tax liabilities were $547.0 million and $546.0 million, respectively. The income tax accounting process to determine the deferred tax liabilities involves estimating all temporary differences between the tax and financial reporting bases of the Company’s assets and liabilities, based on enacted tax laws and statutory tax rates applicable to the period in which the differences are expected to affect taxable income. The Company estimated the current exposure by assessing the temporary differences and computing the provision for income taxes by applying the estimated effective tax rate to income.

11.	FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair Value of Financial Instruments Subject to Fair Value Measurements

Recurring Fair Value Measurements

Fair Value Measurements At Reporting Date

Quoted prices

Significant

Measured at

Balance at

in active

other observable

unobservable

Net Asset Value

March 31,

markets

inputs

as a Practical

Description

2019

Level 1

Level 2

Level 3

Expedient ⁽²⁾

(amounts in thousands)

Liabilities

Deferred compensation plan liabilities⁽¹⁾

30,626

23,506

—

7,120

Quoted prices

Significant

Measured at

Balance at

in active

other observable

unobservable

Net Asset Value

December 31,

markets

inputs

as a Practical

Description

2018

Level 1

Level 2

Level 3

Expedient ⁽²⁾

(amounts in thousands)

Liabilities

Deferred compensation plan liabilities⁽¹⁾

30,928

23,476

—

7,452

(1)	The Company’s deferred compensation liability, which is included in other long-term liabilities, is recorded at fair value on a recurring basis. The unfunded plan allows participants to hypothetically invest in various specified investment options.

(2)

The fair value of underlying investments in collective trust funds is determined using the net asset value (“NAV”) provided by the administrator of the fund as a practical expedient. The NAV is determined by each fund’s trustee based upon the fair value of the underlying assets owned by the fund, less liabilities, divided by outstanding units. In accordance with appropriate accounting guidance, these investments have not been classified in the fair value hierarchy.

Fair Value of Financial Instruments Subject to Disclosures

The carrying amount of the following assets and liabilities approximates fair value due to the short maturity of these instruments: (i) cash and cash equivalents; (ii) accounts receivable; and (iii) accounts payable, including accrued liabilities.

The following table presents the carrying value of financial instruments and, where practicable, the fair value as of the periods indicated:


	March 31, 2019				December 31, 2018
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(amounts in thousands)
Term B Loans⁽¹⁾	$	1,291,700	$	1,259,408	$	1,291,700	$	1,243,261

Revolver⁽²⁾	$	—	$	—	$	180,000	$	180,000

Senior Notes⁽³⁾	$	400,000	$	399,500	$	400,000	$	378,000

Other debt⁽⁴⁾	$	889			$	912

Letters of credit⁽⁴⁾	$	5,862			$	5,862

The following methods and assumptions were used to estimate the fair value of financial instruments:

⁽¹⁾	The Company’s determination of the fair value of the TermB-1 Loans was based on quoted prices for these instruments and is considered a Level 2 measurement as the pricing inputs are other than quoted prices in active markets.

⁽²⁾	The fair value of the Revolver was considered to approximate the carrying value as the interest payments are based on LIBOR rates that reset periodically. The Revolver is considered a Level 2 measurement as the pricing inputs are other than quoted prices in active markets.

⁽³⁾

The Company utilizes a Level 2 valuation input based upon the market trading prices of the Senior Notes to compute the fair value as these Senior Notes are traded in the debt securities market. The Senior Notes are considered a Level 2 measurement as the pricing inputs are other than quoted prices in active markets.

⁽⁴⁾	The Company does not believe it is practicable to estimate the fair value of the other debt or the outstanding standby letters of credit.

Investments Valued Under the Measurement Alternative

The Company holds investments in privately held companies that are not exchange-traded and therefore not supported with observable market prices. The Company does not have significant influence over the investees. The amended accounting guidance for financial instruments provides an alternative to measure equity securities without readily determinable fair values at cost less impairment (if any), plus or minus observable price changes from an identical or similar investment of the same issuer (the “measurement alternative”). The Company elected the measurement alternative for its qualifying equity securities.

The Company’s investments are recognized on the consolidated balance sheet at their cost basis, which represents the amount the Company paid to acquire the investments.

The Company periodically evaluates the carrying value of its investments, when events and circumstances indicate that the carrying amount of the assets may not be recoverable. The Company considers investee financial performance and other information received from the investee companies, as well as any other available estimates of the fair value of the investee companies in its evaluation.

If certain impairment indicators exist, the Company determines the fair value of its investments. If the Company determines the carrying value of an investment exceeds its fair value, the Company writes down the value of the investment to its fair value. The fair value of the investments are not adjusted if there are no identified adverse events or changes in circumstances that may have a material effect on the fair value of the investment.

Since its initial date of investment, the Company has not identified any events or changes in circumstances which would require the Company to estimate the fair value of its investments. Accordingly, there has been no impairment in the Company’s investments measured under the measurement alternative. Additionally, there have been no returns of capital or changes resulting from observable price changes in orderly transactions. As a result, the investments measured under the measurement alternative continue to be presented at their original cost basis on the consolidated balance sheets.

There was no material change in the carrying value of the Company’s cost-method investments since the year ended December 31, 2018.

The following table presents the Company’s investments valued under the measurement alternative:


	Investments Valued Under the Measurement Alternative
	March 31,		December 31,
	2019		2018
	(amounts in thousands)
Investment balance before cumulative impairment as of January 1,	$	11,205	$	9,955
Accumulated impairment as of January 1,		—		—

Investment beginning balance after cumulative impairment as of January 1,		11,205		9,955
Acquisition of interest in a privately held company		—		1,250

Ending period balance	$	11,205	$	11,205

12.	ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

Assets Held for Sale

Long-lived assets to be sold are classified as held for sale in the period in which they meet all the criteria for the disposal of long-lived assets. The Company measures assets held for sale at the lower of their carrying amount or fair value less cost to sell. Additionally, the Company determined that these assets comprise operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the Company.

As of ~~September 30, 2017,~~December 31, 2018, the Company entered into an agreement with a third party to ~~sell a parcel~~dispose of land ~~along with the~~and land improvements, ~~broadcasting tower~~buildings and ~~building located on~~equipment. The Company conducted an analysis and determined the ~~property, in one of its markets for $3.3 million and~~assets met the criteria to be classified ~~these assets~~ as ~~assets~~ held for sale. ~~This transaction, which is expected to be completed in~~In aggregate, these assets had a carrying value of approximately $19.6 million. In the ~~fourth~~first quarter of ~~2017, is expected to result~~2019, the Company completed this sale for $24.5 million in cash. The Company recognized a gain ~~of $0.3 million,~~on the sale, net of sales commissions and other expenses, of ~~$0.2~~approximately $4.5 million.

~~As of September 30, 2017,~~On February 13, 2019, the Company entered into an agreement ~~to divest three radio stations to EMF in order to facilitate~~with Cumulus Media Inc. (“Cumulus”) under which the ~~Merger. The~~ Company ~~is disposing of equipment, radio broadcasting licenses, goodwill, and other assets across~~will exchange three of its ~~markets~~stations in Indianapolis, Indiana for ~~$57.8 million~~two Cumulus stations in Springfield, Massachusetts, and one Cumulus station in New York City, New York. The Company and Cumulus began programming the respective stations under an LMA on March 1, 2019. The Company conducted an analysis and determined the assets to be exchanged to Cumulus met the criteria to be classified ~~these assets~~ as ~~assets~~ held for ~~sale. This~~sale at March 31, 2019. The exchange transaction ~~which~~(the “Cumulus Exchange”) is expected to close onin the ~~date following the closing~~second quarter of ~~the Company’s Merger with CBS Radio, is expected to result in a gain of $2.6 million.~~2019.

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. ~~The Company determined that the carrying value of these assets was less than the fair value by utilizing offers from third parties for a bundle of assets.~~ This is considered a Level 3 measurement.

The major categories of these assets held for sale are as follows:


	Assets Held For Sale			Assets Held for Sale
	September 30,			March 31, 2019						December 31, 2018
	2017			Total		Cumulus Exchange		Other Assets Held for Sale		Total		Cumulus Exchange		Other Assets Held for Sale
	(amounts in thousands)			(amounts in thousands)
Land and land improvements	$	2,820		$	401	$	401	$	—	$	2,645	$	—	$	2,645
Building		8			8		8		—		1,053		—		1,053
Equipment		1,206			389		389		—		15,905		—		15,905

Gross property and equipment		4,034
Accumulated Depreciation		(822	)

Net property and equipment		3,212			798		798		—		19,603		—		19,603

Radio broadcasting licenses		54,551
Accumulated Amortization		(33	)

Net radio broadcasting licenses		54,518			17,135		17,135		—		—		—		—

Other intangibles		3
Goodwill		266			4,862		4,862		—		—		—		—

Total intangibles		54,787			21,997		21,997		—		—		—		—

Assets held for sale		57,999

Net assets held for sale	$	57,999		$	22,795	$	22,795	$	—	$	19,603	$	—	$	19,603

~~11.~~ Discontinued Operations

The results of operations for several radio stations acquired from CBS, which were never a part of the Company’s continuing operations as these radio stations have been disposed, were classified as discontinued operations for the period commencing after the Merger.

Refer to Note 2, Business Combinations, for additional information on the Bonneville Transaction.

The following table presents the results of operations of the discontinued operations:


	Three Months Ended March 31,
	2019		2018
	(amounts in thousands)
Net time brokerage agreement (income) fees		—		415

Income before income taxes		—		415
Income taxes		—		87

Income from discontinued operations, net of income taxes	$	—	$	328

13.	SHAREHOLDERS’ EQUITY

Dividends

~~During the second quarter of 2016,~~On November 2, 2017, the Company’s Board of Directors ~~commenced~~approved an increase to the annual ~~$0.30 per share~~ common stock dividend program to $0.36 per share, beginning with the dividend paid in the fourth quarter of 2017. Management estimates quarterly dividend payments ~~that~~to approximate ~~$2.9~~$12.4 million per ~~quarter.~~quarter (without considering any further reduction in shares from the Company’s stock buyback program). Any future dividends will be at the discretion of the Board ~~of Directors~~ based upon the relevant factors at the time of such consideration, including, without limitation, compliance with the restrictions set forth in the Company’s Credit Facility and the ~~CBS Radio Merger Agreement.~~Senior Notes.

~~In addition to~~During the ~~quarterly dividend,~~second quarter of 2016, the ~~Company paid a special one-time cash dividend~~Company’s Board of ~~$0.20~~Directors commenced an annual $0.30 per share of common stock on September 15, 2017. Pursuant to the Merger Agreement, the Company agreed not to declare or pay any dividends or make other distributions in respect of any shares of the Company’s capital stock, except for the Company’s regular quarterly cash dividend. This special one-time cash dividend ~~which~~program, with payments that approximated ~~$7.8~~$2.9 million ~~is an exception under the Merger Agreement to the restriction on payment of dividends.~~per quarter.

Dividend Equivalents

The Company’s grants of RSUs include the right, upon vesting, to receive a cash payment equal to the aggregate amount of dividends, if any, that holders would have received on the shares of common stock underlying their RSUs if such RSUs had been vested during the period.

The following table presents the amounts accrued and unpaid on unvested RSUs:

      Dividend Equivalent Liabilities

Balance Sheet Location
   September 30,
2017    December 31,
2016
      (amounts in thousands)
Short-term
   Other current liabilities    $ 446    $ 260
Long-term
   Other long-term liabilities    637    348




Total
      $ 1,083    $ 608

      Dividend Equivalent Liabilities

Balance Sheet
Location
   March 31,
2019    December 31,
2018
      (amounts in thousands)
Short-term
   Other current liabilities    $ 1,878    $ 1,279
Long-term
   Other long-term liabilities    888    1,041




Total
      $ 2,766    $ 2,320

Employee Stock Purchase Plan

The ~~Company adopted the~~Company’s Entercom ~~2016~~ Employee Stock Purchase Plan (the “ESPP”) ~~during the second quarter of 2016 that commenced with the third quarter of 2016. The ESPP~~ allows participants to purchase the Company’s stock at a price equal to 85% of the market value of such shares on the purchase date. The maximum number of shares authorized to be issued under the ESPP is 1.0 million. Pursuant to ~~this plan,~~the ESPP, the Company does not record compensation expense to the employee as income subject to tax on the difference between the market value and the purchase price, as ~~this plan~~the ESPP was designed to meet the requirements of Section 423(b) of the ~~Internal Revenue~~ Code. The Company recognizes the 15% discount in the Company’s consolidated statements of operations asnon-cash compensation expense.

Pursuant to the CBS Radio Merger Agreement, the Company agreed not to issue or authorize any shares of its capital stock until the earlier of the termination of the CBS Radio Merger Agreement or the consummation of the ~~Merger, the Company has agreed not to issue or authorize any shares of its capital stock.~~Merger. As a result, the Company effectively suspended the ESPP during the second quarter of 2017. There were no shares purchased and the Company did not recognize anynon-cash compensation expense in connection with the ESPP during the second, third or fourth quarters of 2017. The Company resumed the ESPP in the first quarter of 2018.


	Three Months Ended March 31,
	2019		2018
	(amounts in thousands)
Number of shares purchased		85		39

Non-cash compensation expense recognized	$	67	$	57

Share Repurchase Program

On November 2, 2017, the Company’s Board of Directors announced a share repurchase program (the “2017 Share Repurchase Program”) to permit the Company to purchase up to $100.0 million of the Company’s issued and outstanding shares of Class A common stock through open market purchases. Shares repurchased by the Company under the 2017 Share Repurchase Program will be at the discretion of the Company based upon the relevant factors at the time of such consideration, including, without limitation, compliance with the restrictions set forth in the Company’s Credit Facility and the Senior Notes.

During the three months ended ~~September 30, 2017. The Company plans to resume the ESPP after the consummation of the Merger.~~

   Nine Months Ended
September 30,
   2017    2016
   (amounts in thousands)
Number of shares purchased
   15    18




Non-cash compensation expense recognized
   $ 32    $ 34

~~12. CONTINGENCIES AND COMMITMENTS~~

~~Contingencies~~

~~If the CBS Radio Merger Agreement is terminated under certain circumstances,~~March 31, 2019, the Company ~~will be required to pay CBS a termination fee of $30 million and~~did not repurchase any shares under the ~~costs for the committed financing.~~2017 Share Repurchase Program.

14.	CONTINGENCIES AND COMMITMENTS

Contingencies

The Company is subject to various outstanding claims which arise in the ordinary course of business and to other legal proceedings. Management anticipates that any potential liability of the Company, which may arise out of or with respect to these matters, will not materially affect the Company’s financial position, results of operations or cash flows. There were no material changes from the contingencies listed in the Company’s Form10-K, filed with the SEC on February ~~28, 2017.~~27, 2019, except as described below.

~~Other Matters~~Like-Kind Exchange Proceeds

During the third quarter of ~~2016,~~2018, the Company ~~settled~~disposed of certain property that the Company considered as surplus to its operations and that resulted in significant gains reportable for tax purposes. In order to minimize the tax impact on a ~~legal claim with British Petroleum~~certain portion of these taxable gains, the Company created an entity that serves as a ~~result~~QI for tax purposes and that held the net sales proceeds of ~~their Deepwater Horizon Oil Spill~~$70.2 million. The net sales proceeds were deposited into the account of the QI to comply with requirements under Section 1031 of the Code to execute a like-kind exchange and were reflected as restricted cash on the Company consolidated balance sheet at December 31, 2018.

The Company used a portion of these funds in atax-free exchange by using the net sales proceeds from relinquished property for the purchase of replacement property. This QI was treated as a VIE and was included in the ~~Gulf~~Company’s prior year consolidated financial statements as the Company was considered the primary beneficiary.

Under Section 1031 of ~~Mexico that occurred~~the Code, the property to be exchanged in ~~2010 and recovered $2.3 million~~the like-kind exchange was required to be received by the Company within 180 days. This period of time lapsed during the first quarter of 2019, at which point, the restrictions on ~~a net basis after deducting certain related expenses. The claim was~~the cash balances were released. As a result, the Company does not present restricted cash on its balance sheet at March 31, 2019.

The following table provides a reconciliation of ~~lost business due~~cash and cash equivalents and restricted cash reported within the consolidated balance sheet that aggregate to the ~~oil spill.~~total of the same such amounts shown in the consolidated statement of cash flows:

~~13.~~


	Cash, Cash Equivalents and Restricted Cash
	March 31,		December 31,
	2019		2018
	(amounts in thousands)
Cash and cash equivalents	$	68,266	$	122,893
Restricted cash		—		69,365

Total cash, cash equivalents and restricted cash shown in the statement of cash flows	$	68,266	$	192,258

15.	SUBSEQUENT EVENTS

Events occurring after ~~September 30, 2017,~~March 31, 2019, and through the date that these consolidated financial statements were issued, were evaluated to ensure that any subsequent events that met the criteria for recognition have been included and are as follows:

On ~~October 10, 2017,~~April 30, 2019, the ~~Company filed an amendment to a Registration Statement with the SEC on Form S-4/A relating to the Merger. The amendment provides that, among other things, the Company will dispose of an appropriate~~Company’s finance subsidiary, Entercom Media Corp., issued $325.0 million in aggregate principal amount of ~~stations in order to maintain compliance with~~senior secured second-lien notes due 2027 (the “Notes”). Interest on the ~~FCC’s local radio ownership rule. Refer to a description~~Notes accrues at the rate of 6.5% per annum. The Company used net proceeds of the ~~proposed divestitures below.~~

~~On October 13, 2017, the Company closed on the sale of a parcel of land~~offering, along with cash on hand and $89.0 million under its Revolver, to repay $425.0 million of existing indebtedness under its TermB-1 Loan. The Notes are fully and unconditionally guaranteed on a senior secured second-lien basis by each direct and indirect subsidiary of Entercom Media Corp. The Notes and the ~~land improvements, broadcasting tower and building located~~related guarantees are secured on ~~the property. The sale of these assets, which were classified as assets held for sale at September 30, 2017, resulted in~~ a ~~gain of $0.3 million, net of commissions of $0.2 million.~~

~~On October 16, 2017, the Company filed an amendment to a Registration Statement with the SEC~~second-priority basis by liens on Form S-4/A relating to the Merger. The amendment is an exhibits only filing to file various exhibits without making any changes to the prospectus. The Company filed a definitive proxy statement that relates to the special meeting of shareholderssubstantially all of the ~~Company to approve~~assets of Entercom Media Corp. and the ~~issuance of shares of Class A Common Stock in connection with the Merger.~~

~~On October 19, 2017, the Company filed~~guarantors. The Notes will not be a final amendment to a Registration Statement with the SEC on Form S-4/A relating to the Merger. This amendment, among other things, calls a meeting (the “Special Meeting”) of the Company’s shareholders. The Special Meeting will be held on November 15, 2017 for shareholders of record on October 12, 2017, to approve the issuance of shares of the Company’s Class A Common Stock in the Mergerregistered security and ~~to approve the classification of the Company’s board of directors. In addition, CBS Radio filed a registration statement on Form S-4 and Form S-1~~there are no plans to register the shares of Radio Common Stock that will be distributed to holders of CBS Class B Common Stock. Holders of CBS Class B common stock will have the opportunity to exchange some or all of their shares for CBS Radio Common Stock. This exchange offer is scheduled to expire on November 16, 2017. Holders of CBS Radio Common Stock will then receive shares of the Company’s Class A Common StockNotes as a security in the ~~Merger. Based~~future.

In addition, on ~~this timing,~~April 30, 2019, Entercom Media Corp amended the ~~Company anticipates~~financial covenant in its Senior Secured Credit Agreement such that the ~~Merger will close as early as November 17, 2017.~~calculation of Consolidated Secured Net Leverage Ratio only includes first lien secured debt.

ITEM 2.

~~ITEM 2.~~ Management’s Discussion And Analysis Of Financial Condition And Results Of Operations

In preparing the discussion and analysis contained in this Item 2, we presume that readers have read or have access to the discussion and analysis contained in our Annual Report on Form10-K filed with the Securities and Exchange Commission (the “SEC”) on February ~~28, 2017.~~27, 2019. In addition, you should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and related notes included elsewhere in this report. ~~The following results of operations include a discussion of the nine and three months ended September 30, 2017 as compared to the comparable periods in the prior year.~~ Our results of operations during the relevant periods represent the operations of the radio stations owned or operated by us.

Results Of Operations For TheYear-To-Date

The following significant factors affected our results of operations for the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2019, as compared to the ~~nine~~three months ended ~~September 30, 2016:~~March 31, 2018:

~~Merger~~WXTU Transaction

On July 18, 2018, we entered into an agreement with Beasley Broadcast Group, Inc. (“Beasley”) to sell certain assets ofWXTU-FM, serving the Philadelphia, Pennsylvania radio market for $38.0 million in cash (the “WXTU Transaction”). In connection with this disposition, which closed during the third quarter of 2018, we recognized a gain of approximately $4.4 million.

Based on the timing of this transaction, our consolidated financial statements for the three months ended March 31, 2019 do not reflect the net revenues, station operating expenses, depreciation and amortization expenses of this divested station, whereas our consolidated financial statements for the three months ended March 31, 2018 do reflect the net revenues, station operating expenses, depreciation and amortization expenses of this divested station.

Jerry Lee Transaction

On September 27, 2018, we completed a transaction to acquire the assets ofWBEB-FM, serving the Philadelphia, Pennsylvania radio market from Jerry Lee Radio, LLC (“Jerry Lee”) for a purchase price of $57.5 million in cash, less certain working capital and other credits (the “Jerry Lee Transaction”). We used proceeds from the WXTU Transaction and cash on hand to fund this acquisition.

Based on the timing of this transaction, our consolidated financial statements for the three months ended March 31, 2019 reflect the net revenues, station operating expenses, depreciation and amortization expenses of this acquired station, whereas our consolidated financial statements for the three months ended March 31, 2018 do not reflect the net revenues, station operating expenses, depreciation and amortization expenses of this acquired station.

Integration Costs And ~~Acquisition Costs Incurred Under The CBS Radio Merger Agreement~~Restructuring Charges

On February 2, 2017, we and our ~~newly formed wholly owned~~wholly-owned subsidiary (“Merger Sub”) entered into an Agreement and Plan of Merger (the “CBS Radio Merger Agreement”) with CBS Corporation (“CBS”) and its ~~wholly owned~~wholly-owned subsidiary CBS Radio Inc. (“CBS Radio”). Pursuant to the CBS Radio Merger Agreement, Merger Sub ~~will merge~~merged with and into CBS Radio with CBS Radio surviving as our ~~wholly owned~~wholly-owned subsidiary (the “Merger”). The Merger is expected to be tax free to CBS and its shareholders, and will be effected through a stock for stock Reverse Morris Trust transaction. The Merger will make us a leading local media and entertainment companyclosed on November 17, 2017.

In connection with a nationwide footprint of stations including positions in all of the top 10 markets and 22 of the top 25 markets. The transactions contemplated by the CBS Radio Merger Agreement are subject to approval by our shareholders and customary regulatory approvals. Such approvals will require the divestiture of stations in certain markets due to regulatory requirements.

~~Transaction costs relating to~~ the Merger, we incurred integration costs, including ~~legal, advisory~~transition services, consulting services and professional fees of ~~$24.9~~$1.1 million and $9.7 million during the three months ended March 31, 2019 and March 31, 2018, respectively. Amounts were expensed as incurred ~~during the first three quarters of 2017~~ and are included in ~~merger~~integration costs.

In connection with the Merger, we incurred restructuring charges, including costs to exit duplicative contracts, lease abandonment costs, workforce reductions and ~~acquisition costs.~~other restructuring costs of $1.0 million and $1.5 million during the three months ended March 31, 2019 and March 31, 2018, respectively. Amounts were expensed as incurred and are included in restructuring charges.

~~Disposal Of FCC Broadcasting License Related To The~~ Merger And Acquisition Costs

~~We recorded a $13.5 million loss in~~During the first quarter of 2017 in net gain/loss on sale or disposal of assets as a result of permanently discontinuing the operation of one of our stations and returning the station’s license to the FCC for cancellation, in order to facilitate the Merger.

~~Debt Refinancing Lowered Our Interest Expense~~

On November 1, 2016, we entered into a $540 million credit facility (the “Credit Facility”) and used the proceeds to: (1) refinance our outstanding senior credit facility (the “Former Credit Facility”) that was comprised of: (a) a term loan component (“Former Term B Loan”) with $223.0 million outstanding at the date of the refinancing; and (b) a revolving credit facility (the “Former Revolver”) with $3.0 million outstanding at the date of the refinancing; (2) fund the redemption of the $220.0 million 10.5% Senior Notes due December 1, 2019 (the “Senior Notes”) and discharge the Indenture governing the Senior Notes; (3) fund $11.6 million of accrued interest and a call premium of $5.8 million on the Senior Notes; and (4) paythree months ended March 31, 2018, transaction costs ~~associated with the refinancing. This refinancing lowered our interest expense in the first three quarters of 2017.~~were $1.4 million, and were expensed as incurred.

~~Charlotte Acquisition~~

On January 6, 2017, we completed a transaction with Beasley Broadcast Group, Inc. (“Beasley”) to acquire four radio stations in Charlotte, North Carolina, for a purchase price of $24 million in cash (the “Beasley Acquisition”). We used cash on hand to fund the acquisition. We commenced operations under a time brokerage agreement (“TBA”) for three of the stations on November 1, 2016 and the fourth station upon acquisition on January 6, 2017, that increased in 2017 our net revenues, station operating expenses and depreciation and amortization expenses.

~~Goodwill Impairment~~

Our annual goodwill impairment test indicated that the goodwill allocated to our Boston, Massachusetts market was impaired. As a result, we wrote off approximately $0.4 million of goodwill during the second quarter of 2017.

~~Nine~~Three Months Ended ~~September 30, 2017~~March 31, 2019 As Compared To The ~~Nine~~Three Months Ended ~~September 30, 2016~~March 31, 2018


	NINE MONTHS ENDED SEPTEMBER 30,									THREE MONTHS ENDED MARCH 31,
	2017			2016			% Change			2019			2018			% Change
	(dollars in millions)									(dollars in millions)
NET REVENUES	$	346.3		$	340.2			2	%	$	309.0		$	300.6			3	%

OPERATING EXPENSE:
Station operating expenses		256.0			240.4			6	%		249.0			255.7			(3	%)
Depreciation and amortization expense		8.1			7.5			8	%		11.1			8.5			31	%
Corporate general and administrative expenses		28.8			24.9			16	%		20.9			18.7			12	%
Impairment loss		0.4			0.1			300	%
Integration costs											1.1			9.7			(89	%)
Restructuring charges											1.0			1.5			(33	%)
Merger and acquisition costs		24.9			0.7			nmf			—			1.4			(100	%)
Other operating (income) expenses		13.2			(1.4	)		nmf			(4.5	)		(0.6	)		nmf

Total operating expense		331.4			272.2			22	%		278.6			294.9			(6	%)

OPERATING INCOME (LOSS)		14.9			68.0			(78	%)		30.4			5.7

NET INTEREST EXPENSE		18.6			27.6			(33	%)		25.2			23.4			8	%
OTHER (INCOME) EXPENSE		—			(2.3	)		100	%

INCOME (LOSS) BEFORE INCOME TAXES (BENEFIT)		(3.7	)		42.7			(109	%)		5.2			(17.7	)		129	%
INCOME TAXES (BENEFIT)		(4.9	)		16.1			(130	%)		2.1			(3.5	)		160	%

NET INCOME (LOSS) AVAILABLE TO THE COMPANY		1.2			26.6			(95	%)
Preferred stock dividend		(1.8	)		(1.3	)		38	%
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS - CONTINUING OPERATIONS											3.1			(14.2	)		122	%
Income from discontinued operations, net of income taxes (benefit)											—			0.3			(100	%)

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS	$	(0.6	)	$	25.3			(102	%)	$	3.1		$	(13.9	)		122	%

Net Revenues

Contributing to the increase in net revenues was the operation of ~~four stations~~the station acquired in the ~~Charlotte~~Philadelphia market ~~during~~in connection with the ~~current period which were not operated by us during the prior period.~~Jerry Lee Transaction. Offsetting this increase, net revenues were negatively impacted by ~~several factors including~~ the ~~reduction in political advertising and the return~~disposal of a ~~broadcasting license to the FCC~~radio station in the ~~first quarter of 2017 to facilitate~~Philadelphia market in connection with the ~~Merger.~~WXTU Transaction.

Net revenues increased the most for our stations located in the ~~Atlanta~~New York City and ~~Miami~~Washington, D.C. markets.

Net revenues decreased the most for our stations located in the ~~Denver market~~Chicago and ~~several of our other larger~~Minneapolis markets.

Station Operating Expenses

Station operating expenses ~~increased~~decreased in themid-single digits for the current period primarily due to ~~an increase~~a reduction in ~~costs~~variable expenses associated with operating ~~additional~~our stations ~~acquired in Charlotte, North Carolina, and fees associated with new broadcast rights for a major league baseball team in one of our markets.~~more efficiently due to synergies recognized.

Station operating expenses includenon-cash compensation expense of ~~$0.9~~$1.4 million and ~~$1.0~~$2.0 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2019 and ~~September 30, 2016,~~March 31, 2018, respectively.

Depreciation And Amortization Expense

Depreciation and amortization expense increased primarily ~~as a result of the depreciation and amortization associated with the stations acquired in Charlotte, North Carolina, and~~due to an increase in capital expenditures. The increase in capital expenditures was primarily due to the consolidation and relocation of several studio facilities in larger markets, an increase in our size and capital needs associated with the ~~relocation, consolidation and improvement~~integration of ~~studio facilities~~common systems across the new markets acquired in ~~several of our larger markets.~~the Merger.

Corporate General And Administrative Expenses

Corporate general and administrative expenses increased primarily due to ~~the increase in costs associated with: (1) certain contractual obligations of $1.3 million to a senior executive as a result of the non-renewal of his employment agreement; (2)~~ an increase in ~~payroll expense of $1.2 million as a result of hiring additional employees~~software expenses and ~~expanding the work-force in advance of the Merger; (3)~~ an increase in expense related to the Company’s deferred compensation ~~expense of $0.7 million as our deferred compensation liability generally tracks the movements in the stock market; and (4) an increase in corporate marketing capabilities and staff.~~plan.

Corporate general and administrative expenses includenon-cash compensation expense of ~~$3.7~~$2.2 million and $2.0 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2019 and ~~September 30, 2016.~~March 31, 2018, respectively.

~~Merger and acquisition~~Integration Costs

Integration costs

~~Merger and acquisition costs increased due to transaction costs relating to~~ were incurred in 2018 as a result of the Merger. These costs primarily ~~consist~~consisted of ongoing costs related to effectively combining and incorporating CBS Radio into our operations. Based on the timing of the Merger, integration activities primarily occurred in 2018 and were reduced significantly in 2019.

Restructuring Charges

We incurred restructuring charges in 2019 and 2018 primarily as a result of the restructuring of operations for the Merger. These costs primarily included workforce reduction charges, the abandonment of excess studio space in certain markets, costs to exit duplicative contracts and other charges.

We expect to incur restructuring costs in the range of $9.0 to $12.0 million in 2019.

Merger And Acquisition Costs

There was a significant reduction in the amount of legal, professional, and other advisory ~~services.~~services incurred as the Merger closed in the fourth quarter of 2017.

Other ~~operating (income) expenses~~Operating (Income) Expenses

~~Other operating expenses increased primarily as~~During the three months ended March 31, 2019, we completed a ~~result~~sale of ~~incurring~~land and land improvements, buildings and equipment and recognized a ~~$13.5 million loss from permanently discontinuing~~gain of $4.5 million. During the ~~operation of one of our stations and returning the station’s license to the FCC for cancellation, in order to facilitate the Merger.~~three months ended March 31, 2018, we had no such sales activities.

Operating Income (Loss)

Operating income in the current period ~~decreased~~increased primarily due to: ~~(1)~~(i) an increase in net revenues, net of station operating expenses of $15.2 million; (ii) a decrease in integration costs of $8.6 million; (iii) a net increase in other operating (income) expenses of $4.0 million; (iv) a decrease in merger and acquisition costs of ~~$24.9 million~~$1.4 million; and (v) a decrease in ~~connection with the Merger; (2) the recognition~~restructuring charges of ~~a $13.5 million loss from permanently discontinuing the operation of one of our stations and returning the station’s license to the FCC for cancellation, in order to facilitate the Merger; (3)~~$0.5 million.

These increases were partially offset by: (i) an increase in ~~station operating expenses for the reasons described above;~~depreciation and ~~(4)~~amortization expense of $2.6 million; and (ii) an increase in corporate, general and administrative expenses ~~for the reasons described above.~~of $2.3 million.

Interest Expense

~~Interest~~During the three months ended March 31, 2019, we incurred an additional $1.8 million of interest expense ~~declined~~ primarily ~~as a result of~~due to the ~~refinancing on November 1, 2016, that included the retirement of~~increase in LIBOR rates associated with our ~~Senior Notes using lower cost bank~~variable rate debt. This increase was partially offset by an overall reduction in our indebtedness.

Income (Loss) Before Income Taxes (Benefit)

The generation of ~~a loss~~income before income taxes was ~~largely~~primarily attributable ~~to the transaction costs incurred~~to: (i) an increase in ~~connection with the Merger~~net revenues, net of station operating expenses; (ii) a decrease in integration costs; (iii) a net increase in other operating (income) expenses; (iv) a decrease in merger and ~~the loss generated~~acquisition costs; and (v) a decrease in restructuring charges. The increases in income before income taxes as a result of ~~incurring a $13.5 million loss from permanently discontinuing the operation of one of our stations~~these activities were partially offset by increases in: (i) depreciation and ~~returning the station’s license to the FCC for cancellation, in order to facilitate the Merger.~~amortization expenses; (ii) corporate, general and administrative expenses; and (iii) net interest expense.

Income Taxes (Benefit)

Tax Rate For The ~~Nine~~Three Months Ended ~~September 30, 2017~~March 31, 2019

The ~~estimated annual~~ effective income tax rate was ~~131.7%~~39.5% which was determined using a forecasted rate based upon taxable income for the year. The ~~estimated annual~~ effective income tax rate ~~as compared to~~is typically higher in the ~~expected tax rate~~first quarter of ~~40% was primarily impacted by significant, non-deductible merger and acquisition costs related to~~ the ~~Merger. The estimated annual effective tax rate is estimated to be higher than in previous years~~year primarily due toto: (i) the

~~amount of merger and acquisition costs forecasted for 2017 as a result~~ seasonality of the ~~Merger, as~~business which results in a ~~significant amount of these costs are not deductible~~lower reported figure for ~~federal~~income before income taxes; and ~~state~~(ii) the disproportionate impact that discrete items may have on such lower reported income ~~tax purposes.~~ before income taxes figures.

We estimate that our ~~2017 estimated~~2019 annual ~~effective~~ tax rate before discrete items, which may fluctuate from quarter to quarter, will be ~~96.5%~~approximately 30%.

As a result of adopting the amended accounting guidance for stock-based compensation on January 1, 2017, we recorded a discrete windfall income tax benefit of a $0.8 million for the nine months ended September 30, 2017, from the vesting of stock-based awards with tax deductions in excess of the compensation expense recorded.

Tax Rate For The ~~Nine~~Three Months Ended ~~September 30, 2016~~March 31, 2018

The estimated annual effective income tax rate was ~~37.6%~~19.8%, which was ~~impacted by discrete~~determined using a forecasted rate based upon taxable income for the year. The annual effective tax rate was estimated to be lower than in previous years primarily due to: (i) an income tax ~~benefits~~benefit resulting from ~~recent legislation~~the Tax Cuts and Jobs Act that was enacted on December 22, 2017 which reduced the U.S. federal corporate tax rate; and (ii) a reduction in ~~certain single member states that allowed for: (1) the reversal of partial valuation allowances; and (2) a retroactive decrease~~non-deductible transaction costs in ~~deferred tax liabilities associated with our non-amortizable broadcast licenses and goodwill assets. The impact of discrete items~~2018 due to the ~~income tax rate is typically substantially greater in the first quarter~~closing of the ~~year as income before income taxes is the lowest as compared to subsequent quarters.~~Merger on November 17, 2017.

Net Deferred Tax Liabilities

As of ~~September 30, 2017,~~March 31, 2019, and December 31, ~~2016,~~2018, our net deferred tax liabilities were ~~$82.7~~$547.0 million and ~~$92.9~~$546.0 million, respectively. The deferred tax liabilities primarily relate to differences between the book and tax bases of certain of our ~~broadcasting~~indefinite-lived intangible assets (broadcasting licenses and ~~goodwill. As a result of adopting the amended~~goodwill). Under accounting guidance, we do not amortize our indefinite-lived intangibles for ~~stock-based compensation further described in Note 1, Basis~~financial statement purposes, but instead test them annually for impairment. The amortization of ~~Presentation and Significant Policies, we recorded a $4.6 million adjustment to equity on January 1, 2017. The corresponding debit was to~~our indefinite-lived assets for tax purposes but not for book purposes creates deferred tax ~~assets, effectively reducing the net~~liabilities. A reversal of deferred tax liabilities bymay occur when indefinite-lived intangibles: (i) become impaired; or (ii) are sold, which would typically only occur in connection with the ~~same amount.~~sale of the assets of a station or groups of stations or the entire company in a taxable transaction. Due to the amortization for tax purposes and not book purposes of our indefinite-lived intangible assets, we expect to continue to generate deferred tax liabilities in future periods (without consideration of any impairment loss in future periods).

Net Income (Loss) Available To The Company - Continuing Operations

The ~~decrease~~change in net income available to the Company from continuing operations was primarily attributable to the reasons described above under Income (Loss) Before Income Taxes (Benefit)~~, net of income tax expense.~~

~~Results Of Operations For The Quarter~~

~~The following significant factors affected our results of operations for the three months ended September 30, 2017 as compared to the same period in the prior year:~~

~~Merger And Acquisition Costs Incurred Under The CBS Radio Merger Agreement~~

~~Transaction costs relating to the Merger, including legal, advisory services~~ and professional fees of $8.8 million, were expensed as incurred during the three months ended September 30, 2017 and are included in merger and acquisition costs. During the third quarter of 2016, we recorded merger and acquisition costs of $0.7 million.

~~Debt Refinancing Lowered Our Interest Expense~~

~~As a result of our debt refinancing completed in the fourth quarter of 2016, we lowered our interest expense for the third quarter of 2017.~~

~~Charlotte Acquisition~~

On January 6, 2017, we completed the Beasley Acquisition to acquire four radio stations in Charlotte, North Carolina. We commenced operation of three stations under a TBA on November 1, 2016 and a fourth station upon acquisition on January 6, 2017, which in 2017 increased our net revenues, station operating expenses, and depreciation and amortization expense.

~~Three Months Ended September 30, 2017 As Compared To The Three Months Ended September 30, 2016~~

THREE MONTHS ENDED
SEPTEMBER 30,
2017 2016 %
Change
(dollars in millions)
NET REVENUES
$ 122.3 $ 121.7 0 %

OPERATING EXPENSE:

Station operating expenses
87.9 84.1 5 %
Depreciation and amortization expense
2.9 2.5 16 %
Corporate general and administrative expenses
9.3 8.8 6 %
Merger and acquisition costs and restructuring charges
8.8 0.7 nmf
Other operating (income) expenses
(0.1 ) (0.1 ) 0 %

Total operating expense
108.8 96.0 13 %

OPERATING INCOME (LOSS)
13.5 25.7 (47 %)

NET INTEREST EXPENSE
6.5 9.0 (28 %)
OTHER (INCOME) EXPENSE
— (2.3 ) 100 %

INCOME (LOSS) BEFORE INCOME TAXES (BENEFIT)
7.0 19.0 (63 %)
INCOME TAXES (BENEFIT)
2.9 7.6 (62 %)

NET INCOME (LOSS) AVAILABLE TO THE COMPANY
4.1 11.4 (64 %)
Preferred stock dividend
(0.7 ) (0.5 ) 40 %

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS
$ 3.4 $ 10.9 (69 %)

~~Net Revenues~~

Contributing to the increase in net revenues was the operation of four stations in the Charlotte market during the quarter which were not operated by us during the same period in the prior year. Offsetting this increase, net revenues was negatively impacted by several factors including the reduction in political advertising and the return of a broadcasting license to the FCC in the first quarter of 2017 to facilitate the Merger.

~~Net revenues increased the most for our stations located in the Atlanta and Greensboro markets.~~

~~Net revenues decreased the most for our stations located in the Denver market and several of our other larger markets.~~

~~Station Operating Expenses~~

~~Station operating expenses increased in the mid-single digits primarily due to an increase in costs associated with operating additional stations acquired in Charlotte, North Carolina.~~

~~Station operating expenses include non-cash compensation expense of $0.4 million for the three months ended September 30, 2017 and September 30, 2016.~~

~~Depreciation And Amortization Expense~~

~~Depreciation and amortization expense increased primarily as a result of the depreciation and amortization associated with the stations acquired in Charlotte, North Carolina.~~

~~Corporate General And Administrative Expenses~~

Corporate general and administrative expenses increased primarily due to the increase in costs associated with: (1) an increase in corporate marketing capabilities and staff; and (2) an increase in payroll expense of $0.5 million as a result of hiring additional employees and expanding the work-force in advance of the Merger.

Corporate general and administrative expenses include non-cash compensation expense of $1.2 million and $1.3 million for the three months ended September 30, 2017 and September 30, 2016, respectively.

~~Operating Income (Loss)~~

Operating income decreased primarily due to: (1) an increase in merger and acquisition costs of $8.8 million in connection with the Merger; (2) an increase in station operating expenses for the reasons described above; and (3) an increase in corporate, general, and administrative expenses for the reasons described above.

~~Interest Expense~~

~~Interest expense declined primarily as a result of the refinancing on November 1, 2016, that included the retirement of our Senior Notes using lower cost bank debt.~~

~~Income (Loss) Before~~ Income Taxes (Benefit)

The decrease in the income before income taxes was primarily attributable to the transaction costs incurred in connection with the Merger and the increase in station operating expenses described above.

~~Income Taxes (Benefit)~~

For the three months ended September 30, 2017, the effective income tax rate was 41.5%, which was determined using a forecasted rate based upon taxable income for the year along with the impact of discrete items for the quarter.

The effective tax rate for the quarter, as compared to the estimated annual effective tax rate of 96.5% was primarily impacted by significant, non-deductible merger and acquisition costs related to the Merger.

For the three months ended September 30, 2016, the effective income tax rate was 39.8%, which primarily reflects adjustments for expenses that are not deductible for tax purposes and an increase in net deferred tax liabilities associated with non-amortizable assets such as broadcasting licenses and goodwill.

~~Net Income (Loss) Available To The Company~~

~~The decrease was primarily attributable to the reasons described above under Income (Loss) Before Income Taxes (Benefit), net of income tax expense.~~.

Liquidity And Capital Resources

~~Liquidity~~Amendment and Repricing – CBS Radio (Now Entercom Media Corp.) Indebtedness

~~As of September 30,~~In connection with the Merger, we assumed CBS Radio’s (now Entercom Media Corp.’s) indebtedness outstanding under: (i) a credit agreement (the “Credit Facility”) among CBS Radio (now Entercom Media Corp.), the guarantors named therein, the lenders named therein, and JPMorgan Chase Bank, N.A., as administrative agent; and (ii) the Senior Notes (described below).

On March 3, 2017, ~~we had $480.5 million outstanding under our~~CBS Radio entered into an amendment to the Credit Facility, ~~which includes~~to, among other things, create a tranche of TermB-1 Loans (the “TermB-1 Tranche”) in an aggregate principal amount not to exceed $500.0 million. The TermB-1 Tranche is governed by the Credit Facility and will mature on November 17, 2024.

Immediately prior to the Merger, the Credit Facility was comprised of a revolving credit facility and a term B loan. On the closing date of the Merger and the refinancing, the term B loan was converted into the TermB-1 Tranche and both were simultaneously refinanced (the TermB-1 Loan”).

Liquidity

Immediately following the refinancing activities described above, the Credit Facility as amended, is comprised of ~~$458.0~~a $250.0 million ~~(the “Term B Loan”) and $22.5 million outstanding under a~~ revolving credit facility (the “Revolver”). and a $1,330.0 million TermB-1 Loan.

As of March 31, 2019, we had $1,291.7 million outstanding under the TermB-1 Loan and no amount outstanding under the Revolver. In addition, we had ~~$0.7~~$5.9 million in outstanding letters of credit and ~~$36.8~~$244.1 million undrawn under the Revolver. Our ability to draw additional amounts under the Revolver may be limited due to our Consolidated Net Secured Leverage ~~Ratio.~~Ratio, as defined in the agreement. As of ~~September 30, 2017,~~March 31, 2019, we had ~~$5.4~~$68.3 million in cash and cash equivalents. For the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2019, we ~~increased~~decreased our outstanding debt by ~~$0.5~~$180.0 million.

~~The Refinancing~~ As of March 31, 2019, our consolidated Net Secured Leverage Ratio was 3.3 times as calculated in accordance with the terms of our Credit Facility, which place restrictions on the amount of cash, cash equivalents and restricted cash that can be subtracted in determining consolidated total net debt.

The Credit Facility

On November 1, 2016, we and our wholly owned subsidiary Entercom Radio, LLC, entered into a $540 million Credit Facility with a syndicate of lenders and used the proceeds to: (1) refinance our Former Credit Facility that was comprised of: (a) a Former Term B Loan with $223.0 million outstanding at the date of the refinancing; and

(b) a Former Revolver with $3.0 million outstanding at the date of the refinancing; (2) fund the redemption, effective December 1, 2016, of $220.0 million Senior Notes and discharge the indenture (the “Indenture”) governing the Senior Notes; (3) fund $11.6 million of accrued interest and a call premium of $5.8 million on the Senior Notes; and (4) pay transaction costs associated with the refinancing.

The Credit Facility is comprised of the Revolver and the Term BB-1 Loan.

The ~~$60~~$250.0 million Revolver has a maturity date of November ~~1, 2021.~~17, 2022 and provides for interest based upon the prime rate or LIBOR plus a margin. The ~~undrawn amount of~~margin may increase or decrease based upon our Consolidated Net Secured Leverage Ratio as defined in the ~~Revolver was $36.8 million as of September 30, 2017. The amount of the Revolver available to us is a function of covenant compliance at the time of borrowing.~~agreement.

The ~~$480~~$1,330.0 million Term BB-1 Loan has a maturity date of November ~~1, 2023.~~

17, 2024 and provides for interest based upon the Base Rate or LIBOR, plus a margin. The Term BB-1 Loan requires mandatory prepayments equal to a percentage of Excess Cash Flow, ~~as defined within the agreement,~~ subject to incremental step-downs, depending on ~~the~~our Consolidated Net Secured Leverage Ratio. ~~Beginning in 2018, the~~The first Excess Cash Flow payment, ~~will be~~if any, is due in the first quarter of each year, and is based on the Excess Cash Flow and Consolidated Net Secured Leverage Ratio for the prior year. Because we made voluntary prepayments against the TermB-1 Loan in 2018, which may be applied toward the Excess Cash Flow payment, no Excess Cash Flow payment was due in the first quarter of 2019.

As of ~~September 30, 2017,~~March 31, 2019, we were in compliance with ~~all~~the financial ~~covenants~~covenant then applicable and all other terms of the Credit Facility in all material respects. Our ability to maintain compliance with our covenants under the Credit Facility is highly dependent on our results of operations.

~~As of September 30, 2017, our Consolidated Leverage Ratio was 4.9 times versus a covenant of 5.0 times and our Consolidated Interest Coverage Ratio was 3.8 times versus a covenant of 2.0 times.~~

The increase in the Consolidated Leverage Ratio from 3.7 times as of December 31, 2016 to 4.9 times as of September 30, 2017 was primarily attributable to the following: (1) merger and acquisition costs of $24.9 million, of which approximately $10.0 million was not permitted to be added back under the Credit Facility; and (2) a marginal increase in outstanding debt primarily due to cash required for: (a) the merger and acquisition costs of $24.9 million; (b) the purchase of radio stations in Charlotte, North Carolina for $24 million in cash, which limited our ability to pay down debt; (c) an investment of $9.7 million in a synergistic podcast partnership; (d) a significant increase of $7.7 million in property and equipment primarily associated with the consolidation and relocation of several large-market studio facilities; and (e) a $3.9 million increase in corporate general and administrative expenses connected to an expansion of our work-force and marketing capabilities in anticipation of the Merger and $1.3 million in contractual obligations related to the non-renewal of a senior executive’s employment agreement.

Management believes that over the next 12 months we can continue to maintain compliance. Our operating cash flow remains positive, and we believe that it is adequate to fund our operating needs. We believe that cash on hand, cash from the Revolver, ~~cash from the expected sale of three radio stations that is expected to close in the fourth quarter of 2017~~ and cash from operating activities, ~~together with the proceeds of the committed financing related to the Merger,~~ will be sufficient to permit us to meet our liquidity requirements over the next 12 months, including our debt repayments.

Failure to comply with our financial ~~covenants~~covenant or other terms of our Credit Facility and any subsequent failure to negotiate and obtain any required relief from our lenders could result in a default under the Credit Facility. Any event of default could have a material adverse effect on our business and financial condition. The acceleration of our debt could have a material adverse effect on our business. We may seek from time to time to amend our Credit Facility or obtain other funding or additional funding, which may result in higher interest rates on our debt.

In connection with the CBS Radio Merger Agreement as described in Note 1, Basis of Presentation and Significant Policies, CBS Radio entered into a commitment letter with a syndicate of lenders (the “Commitment Parties”), pursuant to which the Commitment Parties committed to provide up to $500 million of senior secured term loans (the “CBS Radio Financing”) as an additional tranche under a credit agreement (the “CBS Radio Credit Agreement”) among CBS Radio, the guarantors named therein, the lenders named therein, and JPMorgan Chase Bank, N.A., as administrative agent. The proceeds of this additional tranche will be used to: (1) refinance our Credit Facility as described in Note 4, Long-Term Debt; (2) redeem our Perpetual Cumulative Convertible Preferred Stock; and (3) pay fees and expenses in connection with the refinancing. On March 3, 2017, CBS Radio entered into an amendment to the CBS Radio Credit Agreement, to, among other things, create a tranche of Term B-1 Loans in an aggregate principal amount not to exceed $500 million. The Term B-1 Loans, which replace the commitment, are expected to be funded by the Commitment Parties on the closing date of the Merger, subject to customary

conditions. The Term B-1 Loans will be governed by the CBS Radio Credit Agreement and will mature on the date that is seven years after the closing date of the Merger. The Term B-1 Loans will require quarterly principal payments at an annual rate of 1% of the initial principal amount of the Term B-1 Loans, beginning with the first full fiscal quarter ending after the closing of the Merger. The Term B-1 Loans are expected to bear interest at a per annum rate equal to LIBOR plus 2.75%. Interest on the Term B-1 Loans will be payable at the end of each interest period, but in no event less frequently than quarterly.

The Former Credit Facility

On November ~~23, 2011,~~1, 2016, we and our wholly owned subsidiary Entercom Radio, LLC (“Radio”), entered into our ~~prior~~previous credit agreement (the “Former Credit Facility”) with a syndicate of lenders for a ~~$425~~$540 million Former Credit Facility, which was initially comprised of: ~~(a) a $50~~(i) the $60 million ~~Revolver (reduced to $40 million in December 2015)~~revolving credit facility (the “Former Revolver”) that was set to mature on November ~~23, 2016;~~1, 2021; and ~~(b) a $375~~(ii) the $480 million term loan (the “Former Term B ~~Loan~~Loan”) that was set to mature on November ~~23, 2018.~~1, 2023.

~~In connection~~The Senior Notes

Simultaneously with entering into the ~~refinancing described above,~~Merger and assuming the Credit Facility on ~~December 1,~~November 17, 2017, we also assumed the Senior Notes that mature on October 17, 2024 in the amount of $400.0 million (the “Senior Notes”). The Senior Notes, which were originally issued by CBS Radio (now Entercom Media Corp.) on October 17, 2016, ~~amounts outstanding~~were valued at a premium as part of the fair value measurement on the date of the Merger. The premium on the Senior Notes will be amortized over the term under the ~~Former Credit Facility were repaid~~effective interest rate method. As of any reporting period, the unamortized premium on the Senior Notes is reflected on the balance sheet as an addition to the $400.0 million liability.

Interest on the Senior Notes accrues at the rate of 7.250% per annum and is payable semi-annually in ~~full.~~

arrears on May 1 and November 1 of each year. The Senior Notes may be redeemed at any time on or after November 1, 2019 at a redemption price of 105.438% of their principal amount plus accrued interest. The redemption price decreases over time to 100% of their principal amount plus accrued interest.

All of our subsidiaries, other than Entercom Media Corp., jointly and severally guaranteed the Senior Notes.

A default under our Senior Notes could cause a default under our Credit Facility. Any event of default, therefore, could have a material adverse effect on our business and financial condition.

We may from time to time seek to repurchase or retire our outstanding indebtedness through open market purchases, privately negotiated transactions or otherwise. Such repurchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

The Senior Notes are not a registered security and there are no plans to register our Senior Notes as a security in the future. As a result, Rule3-10 of RegulationS-X promulgated by the SEC is not applicable and no separate financial statements are required for the guarantor subsidiaries.

The Former Senior Notes

In ~~connection with the refinancing described above, on November 1,~~ 2016, we issued a call notice to redeem our $220.0 million 10.5% unsecured Senior Notes due December 1, 2019 (the “Former Senior Notes”) in full with an effective date of December 1, ~~2016. On November 1,~~ 2016, ~~we deposited~~that was funded by the following funds in escrow to satisfy our obligation under the Senior Notes and discharge the Indenture governing the Senior Notes: (1) $220.0 million to redeem the Senior Notes in full; (2) $11.6 million for accrued and unpaid interest through December 1, 2016; and (3) $5.8 million for a call premium for the early retirementproceeds of the ~~Senior notes.~~Former Credit Facility.

Perpetual Cumulative Convertible Preferred Stock

~~On July 16, 2015,~~A portion of the ~~Company acquired under a Stock Purchase Agreement with The Lincoln National Life Insurance Company~~proceeds from the stock of one of its subsidiaries, Lincoln Financial Media Company (“Lincoln”) which held through subsidiaries the assets and liabilities of radio stations serving the Atlanta, Denver, Miami, and San Diego markets (the “Lincoln Acquisition”).

~~Upon closing~~debt refinancing that occurred on ~~the Lincoln Acquisition in 2015, we issued $27.5 million in~~November 17, 2017 was used to fully redeem our outstanding perpetual cumulative convertible preferred stock (“Preferred”) ~~that, in~~. As a result of this redemption, we removed the ~~event~~net carrying value of a liquidation, ranks senior to common stock in our capital structure. The Preferred is convertible by Lincoln into a fixed number of shares after a three-year waiting period, subject to customary anti-dilution provisions. At certain times (including the first three years after issuance), we can redeem the Preferred ~~in cash at a price of 100%. The dividend rate~~from our books and, therefore, did not pay dividends on our Preferred during the ~~Preferred increases over time from 6% to 12%. We declared and paid dividends in each quarter since the Preferred was issued.~~three months ended March 31, 2019 or March 31, 2018.

~~As described above, the Preferred is expected to be redeemed in full in connection with the CBS Radio Merger Agreement.~~

Operating Activities

Net cash flows provided by operating activities were ~~$25.4~~$65.7 million and ~~$51.0~~$65.9 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2019 and ~~2016,~~March 31, 2018, respectively.

The cash flows from operating activities decreased ~~primarily~~slightly due ~~to: (1) the increase in merger and acquisition costs of $24.9 million associated with the Merger; and (2) a $9.5 million increase in station operating expenses, net of~~to an increase in net ~~revenues. Offsetting this decrease to cash flows from operating activities was the use of $5.2 million from a reduction to~~investment in working capital of $17.6 million, which was partially offset by an increase in net income available to the Company of $17.0 million. The increase in net investment in working capital was primarily due toto: (i) the timing of ~~our interest expense payments~~settlements of accounts payable and accrued liabilities; and (ii) the timing of settlements of other ~~accrued expenses.~~long term liabilities.

Investing Activities

Net cash flows provided by investing activities were $4.0 million for the three months ended March 31, 2019, which primarily reflect proceeds received from dispositions of assets in the amount of $24.5 million, less additions to property and equipment and intangible assets of $20.5 million.

Net cash flows used in ~~investing~~investment activities were ~~$46.7~~$7.8 million for the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2018, which primarily ~~reflected~~reflect: (i) the ~~cash paid to complete the Beasley Acquisition~~purchase of ~~$24.0 million, additions to~~ property and equipment of ~~$12.1~~$5.4 million; (ii) cash paid to acquire amortizable intangible assets of $1.6 million; and (iii) $1.3 million ~~and the~~of cash paid to acquire an interest in a privately held ~~company of $9.7 million.~~company.

Net cash flows provided by investing activities were $2.5 million for the nine months ended 2016, which primarily reflected the proceeds of $7.1 million from the sale of several properties that were reflected under assets held for sale as of December 31, 2015, offset by additions to property and equipment of $4.3 million.

Financing Activities

Net cash flows used in financing activities were ~~$20.2~~$193.7 million and ~~$52.7~~$57.5 million for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2019 and ~~2016,~~March 31, 2018, respectively.

For the ~~nine~~three months ended ~~September 30, 2017,~~March 31, 2019, the cash flows used in financing activities primarily ~~reflect~~reflect: (i) the payments of long term debt of $180.0 million; and (ii) the payment of dividends on common stock ~~dividends~~ of ~~$16.6~~$12.4 million.

For the ~~nine~~three months ended ~~September 30, 2016,~~March 31, 2018, the cash flows used in financing activities primarily ~~reflect~~reflect: (i) the ~~reduction~~payments of ~~our net borrowings by $43.8 million~~long term debt of $21.3 million; (ii) the payment for repurchases of common stock of $20.0 million; and (iii) the payment of dividends on common stock ~~dividends~~ of ~~$5.8~~$12.4 million.

Dividends

~~During~~On November 2, 2017, our Board approved an increase to the ~~second quarter of 2016, we commenced an~~ annual ~~$0.30 per share~~ common stock dividend program to $0.36 per share, beginning with the dividend paid in the fourth quarter of 2017. We estimate quarterly dividend payments ~~that~~to approximate ~~$2.9~~$12.4 million per ~~quarter.~~quarter (without considering any further reduction in shares from our stock buyback program). Any future dividends will be at the discretion of the Board ~~of Directors~~ based upon the relevant factors at the time of such consideration, including, without limitation, compliance with the restrictions set forth in our Credit Facility and the ~~CBS Radio Merger Agreement.~~Senior Notes.

During the second quarter of 2016, we commenced an annual $0.30 per share common stock dividend program, with payments that approximated $2.9 million per quarter.

In addition to the quarterly dividend, ~~the Company~~we paid a specialone-time cash dividend of $0.20 per share of common stock on ~~September 15,~~August 30, 2017. ~~Pursuant~~This specialone-time cash dividend approximated $7.8 million.

As discussed above, we retired our Preferred in full on November 17, 2017 and no further dividends were paid.

Share Repurchase Program

On November 2, 2017, our Board announced a share repurchase program (the “2017 Share Repurchase Program”) to ~~the Merger Agreement, we agreed not~~permit us to ~~declare or pay any dividends or make other distributions in respect~~purchase up to $100.0 million of ~~any~~our issued and outstanding shares of ~~our capital~~Class A common stock ~~except for our regular quarterly cash dividend. This special one-time cash dividend, which approximated $7.8 million, is an exception~~through open market purchases. Shares repurchased by us under the ~~Merger Agreement to~~2017 Share Repurchase Program will be at our discretion based upon the ~~restriction on payment~~relevant factors at the time of ~~dividends.~~

~~Dividends on~~such consideration, including, without limitation, compliance with the restrictions set forth in our ~~Preferred were paid in each quarter commencing in October 2015.~~

~~Income Taxes~~Credit Facility and the Senior Notes.

During the ~~nine~~three months ended ~~September 30,~~March 31, 2019, we did not repurchase any shares under the 2017 Share Repurchase Program. As of March 31, 2019, $59.9 million is available for future share repurchases under the 2017 Share Repurchase Program.

Income Taxes

During the three months ended March 31, 2019, we paid ~~$0.4~~$1.8 million in federal and state income taxes. As a result of the CBS Radio acquisition, the utilization of our net operating loss carryforwards (“NOLs”) will be limited under Internal Revenue Code (“Code”) Section 382. We ~~expect that our quarterly~~may need to make additional federal and state ~~corporate net income~~estimated tax ~~obligations will be minimal for~~payments during the ~~balance~~remainder of the year as we have significant net operating loss carryovers available to offset future income. We do expect to make federal alternative minimum tax (“AMT”) payments during subsequent quarters. The AMT payments are available as a credit to offset income tax liabilities in future years.year.

Capital Expenditures

Capital expenditures, including amortizable intangibles, for the ~~nine~~three months ended ~~September 30, 2017~~March 31, 2019 were ~~$12.1~~$20.5 million. We anticipate that total capital expenditures in ~~2017~~2019 will be ~~between $15.0~~approximately $70 million. This figure includes approximately $10 million ~~and $16.0 million. Capital expenditures this year are estimated to be higher primarily due to the relocation of studio facilities in several markets.~~

~~Contractual Obligations~~

~~If the CBS Radio Merger Agreement is terminated under certain circumstances, we~~which will be ~~required to pay CBS a termination fee~~reimbursed by landlords for tenant improvement allowances.

Contractual Obligations

As of ~~$30 million and the costs for the committed financing.~~

~~Excluding any contractual obligations associated with the Merger that was entered into on February 2, 2017, as of September 30, 2017,~~March 31, 2019, there have been no net material changes in the total amount from the contractual obligations listed in our Form10-K for the year ended December 31, ~~2016,~~2018, as filed with the SEC on February ~~28, 2017.~~27, 2019, other than as described below.

As discussed above, during the three months ended March 31, 2019, we decreased our long-term debt obligations outstanding by $180.0 million. As a result of these debt payments made, we have no amount outstanding under our Revolver at March 31, 2019.

Off-Balance Sheet Arrangements

As of ~~September 30, 2017,~~March 31, 2019, we did not have any materialoff-balance sheet transactions, arrangements or obligations, including contingent obligations.

AsDuring the third quarter of 2018, we disposed of certain property that we considered as surplus to our operations and that resulted in significant gains reportable for tax purposes. In order to minimize the tax impact on a certain portion of these taxable gains, we created an entity that served as a qualified intermediary (“QI”) for tax purposes and that held the net sales proceeds of $70.2 million. The net sales proceeds were deposited into the account of the QI to comply with requirements under Section 1031 of the Code to execute a like-kind exchange and were reflected as restricted cash on our consolidated balance sheet at December 31, ~~2016, we had~~2018.

We used a ~~Variable Interest Entity~~portion of these funds in atax-free exchange by using the net sale proceeds from relinquished property for the purchase of replacement property. This QI was treated as a variable interest entity (“VIE”) ~~that required consolidation. As of December 31, 2016, we consolidated the assets~~ and ~~liabilities of the VIE within~~was included in our prior year consolidated financial statements ~~using fair values for~~as we were considered the ~~assets and liabilities as if we had closed~~primary beneficiary.

Under Section 1031 of the Code, the property to be exchanged in the like-kind exchange was required to be received by us within 180 days. This period of time lapsed during the first quarter of 2019, at which point, the restrictions on the ~~Beasley Acquisition as of December~~cash balances were released. As a result, we do not present restricted cash on our balance sheet at March 31, 2016. The consolidated assets and liabilities of the consolidated VIE at December 31, 2016, represented only the assets and liabilities of the three stations held in a trust (“Charlotte Trust”). Upon the completion of the acquisition from Beasley on January 6, 2017, we reversed the VIE amounts and recorded the assets and liabilities of all four radio stations based upon the preliminary purchase price allocation. Refer to Note 9, Business Combinations, for additional information.2019.

We do not have any other relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitatingoff-balance sheet financial arrangements or other contractually narrow or limited purposes as of ~~September 30, 2017.~~March 31, 2019. Accordingly, we are not materially exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in such relationships.

Future Impairments

We may find it necessary to take impairment charges in future periods based on conditions at that time. Any such impairment could be material.

Critical Accounting Policies

The SEC defines critical accounting policies as those that are most important to the portrayal of a company’s financial condition and results and that require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

There have been no material changes to our critical accounting policies from the information provided in Part II, Item 7, ~~Management’s~~“Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations—Critical~~Operations,” under the heading “Critical Accounting ~~Policies,~~Policies” in our Annual Report on Form10-K for the year ended December 31, ~~2016. We have, however, provided additional disclosures related to one of our critical accounting policies for impairment testing of radio broadcasting licenses~~2018, and ~~goodwill, as we conducted our annual impairment test of broadcasting licenses and goodwill during~~filed with the ~~second quarter of 2017 and conducted an annual impairment test of broadcasting licenses and goodwill during the third quarter of 2017 for a newly acquired market.~~

~~Radio Broadcasting Licenses And Goodwill~~

We have made acquisitions in the past for which a significant amount of the purchase price was allocated to broadcasting licenses and goodwill assets. As of September 30, 2017, we have recorded approximately $789 million in radio broadcasting licenses and goodwill, which represents 76% of our total assets at that date. We must conduct impairment testing at least annually, or more frequently if events or changes in circumstances indicate that the assets might be impaired, and charge to operations an impairment expense in the periods in which the recorded value of these assets is more than their fair value. Any such impairment could be material. After an impairment expense is recognized, the recorded value of these assets will be reduced by the amount of the impairment expense and that result will be the assets’ new accounting basis. Our most recent impairment loss to our broadcasting licenses was in 2012. As a result of our annual impairment testing during the second quarter of 2017, we recognized an impairment lossSEC on ~~our goodwill of $0.4 million.~~

We believe our estimate of the value of our radio broadcasting licenses and goodwill assets is a critical accounting estimate as the value is significant in relation to our total assets, and our estimate of the value uses assumptions that incorporate variables based on past experiences and judgments about future performance of our stations.

~~Broadcasting Licenses Impairment Test~~

~~There were no events or circumstances since the Company’s second quarter annual license impairment test that indicated an interim review of broadcasting licenses was required,~~February 27, 2019, other than as described below.

~~We completed our annual impairment test~~Changes in Accounting Policies – Leases

The guidance was effective for ~~broadcasting licenses during~~us as of January 1, 2019, and was implemented using a modified retrospective approach at the ~~second quarter of 2017 and determined that the fair value~~beginning of the ~~broadcasting licenses was more~~period of adoption, rather than ~~the carrying value in each of our markets and, as a result, we did not record an impairment loss.~~

~~We perform our broadcasting license impairment test by using the direct method~~ at the market level. Each market’s broadcasting licenses are combined into a single unit of accounting for the purpose of testing impairment, as the broadcasting licenses in each market are operated as a single asset. We determine the fair value of broadcasting licenses in each of our markets by relying on a discounted cash flow approach (a 10-year income model) assuming a start-up scenario in which the only assets held by an investor are broadcasting licenses. Our fair value analysis contains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. These assumptions include, but are not limited to: (1) the discount rate; (2) the market share and profit margin of an average station within a market, based upon market size and station type; (3) the forecast growth rate of each radio market; (4) the estimated capital start-up costs and losses incurred during the early years; (5) the likely media competition within the market area; (6) a tax rate; and (7) future terminal values. Changes in our estimatesbeginning of the ~~fair value of~~earliest comparative period presented in these ~~assets could result in material future period write-downs in the carrying value of our broadcasting licenses and goodwill assets.~~financial statements.

The methodology used by us in determining our key estimates and assumptions was applied consistently to each market. Of the seven variables identified above, we believe that the first three (in items (1) through (3) above) are the most important and sensitive in the determination of fair value.

If actual market conditions are less favorable than those projected by the industry or by us, or if events occur or circumstances change that would reduce the fair value of our broadcasting licenses below the carrying value, we may be required to recognize impairment charges, which could be material, in future periods.

~~Goodwill Impairment Test~~

~~There were no events or circumstances since our second quarter of 2017 annual goodwill test that required us to test the carrying value of our goodwill, other than as described below.~~

We completed our annual goodwill impairment test during the second quarter of 2017 and the results indicated that the fair value was greater than the carrying value for all but one of our markets. The results indicated that the carrying value of goodwill for our Boston, Massachusetts market exceeded its fair value by a material amount. The amount by which the carrying value exceeded the fair value was larger than the amount of goodwill allocated to this specific reporting unit. As a result, we ~~determined that the entire carrying amount of goodwill~~changed our accounting policy for leases. Refer to Note 4, Leases, included elsewhere in this report for additional information. Except for this ~~specific reporting unit was impaired and recorded an impairment loss during~~change, the ~~second quarter of 2017~~Company has consistently applied its accounting policies to all periods presented in ~~the amount of $0.4 million.~~these consolidated financial statements.

ITEM 3.

~~ITEM 3.~~ Quantitative And Qualitative Disclosures About Market Risk

We are exposed to market risk from changes in interest rates on our variable rate senior debt (the Term BB-1 Loan and Revolver).

As of ~~September 30, 2017,~~March 31, 2019, if the borrowing rates under LIBOR were to increase 1% above the current rates, our interest expense on: ~~(1)~~(i) our Term B Loan would increase ~~$4.6~~$12.9 million on an annual basis as our Term BB-1 Loan provides for a minimum LIBOR floor; and ~~(2)~~(ii) our Revolver would increase by ~~$0.6~~$2.5 million, assuming our entire Revolver was outstanding as of ~~September 30, 2017.~~March 31, 2019.

Assuming LIBOR remains flat, interest expense in 2019 versus 2018 is expected to be lower as we anticipate reducing our outstanding debt upon which interest is computed. We may seek from time to time to amend our Credit Facility or obtain additional funding, which may result in higher interest rates on our indebtedness and could increase our exposure to variable rate indebtedness.

From time to time, we may seek to limit our exposure to interest rate volatility through the use of interest rate hedging instruments.

~~Assuming LIBOR remains flat, interest expense is expected to be lower due to the decrease in our outstanding debt upon which interest is computed.~~

As of ~~September 30, 2017,~~March 31, 2019, there were no interest rate hedging transactions outstanding.

From time to time, we invest all or a portion of our cash in cash equivalents, ~~that~~which are money market instruments consisting of short-term government securities and repurchase agreements that are fully collateralized by government securities. When such investments are made, we do not believe that we have any material credit exposure with respect to these assets. As of ~~September 30, 2017,~~March 31, 2019, we did not have any investments in money market instruments.

Our credit exposure related to our accounts receivable does not represent a significant concentration of credit risk due to the quantity of advertisers, the minimal reliance on any one advertiser, the multiple markets in which we operate and the wide variety of ~~industries in which our advertisers compete.~~advertising business sectors.

See also additional disclosures regarding liquidity and capital resources made under Liquidity and Capital Resources in Part 1, Item 2, above.

ITEM 4.

~~ITEM 4.~~ Controls And Procedures

Evaluation Of Controls And Procedures

We maintain “disclosure controls and procedures” (as defined in Rules13a-15(e) and15d-15(e) of the Securities Exchange Act of 1934, as amended) that are designed to ensure that: (i) information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms; and (ii) such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our President/Chief Executive Officer and Executive Vice President/Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level.

Changes In Internal Control Over Financial Reporting

~~There has been~~On January 1, 2019, we implemented the amended accounting guidance for leases as described elsewhere in this report. The impact of this guidance had a material impact on our financial position as of March 31, 2019. The impact on our results of operations and cash flows for the three months ended March 31, 2019 was not material.

During our most recent fiscal quarter ended March 31, 2019, we implemented changes to our internal controls related to the implementation of the amended accounting guidance for leases. These changes included: (i) monitoring the adoption process and developing new disclosures required under the standard; (ii) performing an analysis of our leases; and (iii) implementing an updated information technology application for the calculation of ROU assets and lease liabilities.

As the implementation process continues, there may be additional changes in internal control over financial reporting. We will continue to evaluate the impact of any related changes to our internal control over financial reporting. Other than any changes in our internal control over financial reporting related to the implementation of the amended accounting guidance for leases, there were no ~~change~~changes in our internal control over financial reporting during ~~our most recent fiscal quarter~~the three months ended March 31, 2019 that ~~has~~have materially affected, or isare reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

ITEM 1.

~~ITEM 1.~~ Legal Proceedings

There were no material developments relating to the legal proceedings described in our Annual Report on Form10-K for the year ended December 31, ~~2016,~~2018, filed with the Securities and Exchange Commission on February ~~28, 2017.~~27, 2019.

ITEM 1A.

~~ITEM 1A.~~ Risk Factors

There have been no material changes to the Risk Factors described in our Annual Report on Form10-K for the year ended December 31, ~~2016,~~2018, filed with the Securities and Exchange Commission on February ~~28, 2017.~~27, 2019.

ITEM 2.

~~ITEM 2.~~ Unregistered Sales Of Equity Securities And Use Of Proceeds

The following table provides information on our repurchases during the quarter ended ~~September 30, 2017:~~March 31, 2019:

(a)
Total
Number
Of Shares

(b)
Average
Price
Paid

(c)
Total
Number
Of Shares
Purchased
As Part Of
Publicly
Announced
Plans Or

(d)
Maximum
Approximate
Dollar Value
Of Shares
That May
Yet Be
Purchased
Under The
Plans

Period⁽¹⁾
   Purchased    Per Share    Programs    Or Programs
July 1, 2017 - July 31, 2017
   3,905    $ 9.98    —      $ —
August 1, 2017 - August 31, 2017
   410    $ 9.85    —      $ —
September 1, 2017 - September 30, 2017
   —      $ —      —      $ —





Total
   4,315       —


Period⁽¹⁾⁽²⁾	(a) Total Number Of Shares Purchased		(b) Average Price Paid Per Share		(c) Total Number Of Shares Purchased As Part Of Publicly Announced Plans Or Programs		(d) Maximum Approximate Dollar Value Of Shares That May Yet Be Purchased Under The Plans Or Programs
January 1, 2019 - January 31, 2019		2,224	$	5.95		—	$	59,918,176
February 1, 2019 - February 28, 2019		142,478	$	7.33		—	$	59,918,176
March 1, 2019 - March 31, 2019		59,797	$	6.16		—	$	59,918,176

Total		204,499				—

⁽¹⁾

~~As a result of our withholding~~

We withheld shares ~~to satisfy employee tax obligations related to~~upon the vesting of ~~restricted stock units during the three months ended September 30, 2017,~~RSUs in order to satisfy employees’ tax obligations. As a result, we are deemed to have ~~repurchased the following shares withheld to satisfy employees’ tax obligations: (1) 3,905~~purchased: (i) 2,224 shares at an average price of ~~$9.98 per share~~$5.95 in ~~July 2017; and (2) 410~~January 2019; (ii) 142,478 shares at an average price of ~~$9.85 per share~~$7.33 in ~~August 2017.~~February 2019; and (iii) 59,797 shares at an average price of $6.16 in March 2019. These shares are included in the table above.

⁽²⁾

On November 2, 2017, our Board announced a share repurchase program (the “2017 Share Repurchase Program”) to permit us to purchase up to $100.0 million of our issued and outstanding shares of Class A common stock through open market purchases. In connection with the 2017 Share Repurchase Program, we did not repurchase any shares during the three months ended March 31, 2019.

ITEM 3.

~~ITEM 3.~~ Defaults Upon Senior Securities

None.

ITEM 4.

Mine Safety Disclosures

~~ITEM 4. Mine Safety Disclosures~~Not applicable.

~~N/A~~

ITEM 5.

~~ITEM 5.~~ Other Information

None.



101.LAB		XBRL Taxonomy Extension ~~Labels~~Label Linkbase ~~Document (*)~~

101.PRE		XBRL Taxonomy Extension Presentation Linkbase ~~Document (*)~~

~~101.DEF~~*		~~XBRL Taxonomy Extension Definition Linkbase Document (*)~~Filed Herewith

~~(#)~~	~~These exhibits are submitted herewith as~~
#		Incorporated by reference.

^		Furnished herewith. Exhibit is “accompanying” this ~~Quarterly Report on Form 10-Q~~report and shall not be deemed to be “filed” ~~as part of such Quarterly Report on Form 10-Q.~~

~~(*)~~

~~Filed~~ herewith.

SIGNATURES

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


						ENTERCOM COMMUNICATIONS CORP.
						(Registrant)

Date: ~~November 6, 2017~~May 3, 2019						/S/ David J. Field
						Name: David J. Field
						Title: ~~President and~~Chairman, Chief Executive Officer
						and President (principal executive officer)

Date: ~~November 6, 2017~~May 3, 2019						/S/ Richard J. Schmaeling
						Name: Richard J. Schmaeling
						Title: Executive Vice President ~~and~~- Chief Financial Officer ~~(principal~~ (principal financial officer)

4849


Description	Three Months Ended March 31, 2017
	(amounts in thousands)
Net Revenues:
Prior to revision	$	97,452
Revision		1,549

As revised	$	99,001

Station operating expenses, including non-cash compensation expense:
Prior to revision	$	75,617
Revision		1,549

As revised	$	77,166


	Three Months Ended								Year Ended
	March 31,		June 30,		September 30,		December 31,		December 31,
Description	2016
	(amounts in thousands)
Net Revenues:
Prior to revision	$	96,103	$	120,478	$	120,457	$	123,207	$	460,245
Revision		906		1,093		1,184		1,343		4,526

As revised	$	97,009	$	121,571	$	121,641	$	124,550	$	464,771

Station operating expenses, including non-cash compensation expense:
Prior to revision	$	71,715	$	82,639	$	82,905	$	81,485	$	318,744
Revision		906		1,093		1,184		1,343		4,526

As revised	$	72,621	$	83,732	$	84,089	$	82,828	$	323,270


	Three Months Ended								Year Ended
	March 31,		June 30,		September 30,		December 31,		December 31,
Description	2015
	(amounts in thousands)
Net Revenues:
Prior to revision	$	78,420	$	100,592	$	114,662	$	117,704	$	411,378
Revision		589		730		874		910		3,103

As revised	$	79,009	$	101,322	$	115,536	$	118,614	$	414,481

Station operating expenses, including non-cash compensation expense:
Prior to revision	$	59,367	$	70,000	$	81,241	$	77,103	$	287,711
Revision		589		730		874		910		3,103

As revised	$	59,956	$	70,730	$	82,115	$	78,013	$	290,814


	Broadcasting Licenses Carrying Amount
	September 30, 2017			December 31, 2016
	(amounts in thousands)
Beginning of period balance as of January 1,	$	823,195		$	807,381
Disposition of FCC broadcasting license		(13,500	)		—
Consolidation (deconsolidation) of a VIE		(15,738	)		15,738
Acquisition of radio stations		17,174			—
Acquisitions—other		—			112
Assets held for sale		(54,518	)		—
Disposition of radio stations previously reflected as held for sale		—			(36	)

Ending period balance	$	756,613		$	823,195


	Net Interest Expense
	Nine Months Ended September 30,
	2017			2016
	(amounts in thousands)
Interest expense	$	16,913		$	25,382
Amortization of deferred financing costs		1,752			1,929
Amortization of original issue discount of senior notes		—			280
Interest income and other investment income		(79	)		(38	)

Total net interest expense	$	18,586		$	27,553


	Net Interest Expense
	Three Months Ended September 30,
	2017			2016
	(amounts in thousands)
Interest expense	$	5,920		$	8,324
Amortization of deferred financing costs		586			611
Amortization of original issue discount of senior notes		—			96
Interest income and other investment income		(30	)		(17	)

Total net interest expense	$	6,476		$	9,014


	Period Ended		Number Of Restricted Stock Units			Weighted Average Purchase Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value As Of September 30, 2017
RSUs outstanding as of:		December 31, 2016		2,074,794
RSUs awarded				206,603
RSUs released				(468,153	)
RSUs forfeited				(22,623	)

RSUs outstanding as of:		September 30, 2017		1,790,621		$	—		1.2	$	20,413,079

RSUs vested and expected to vest as of:		September 30, 2017		1,790,621		$	—		1.2	$	20,413,079

RSUs exercisable (vested and deferred) as of:		September 30, 2017		48,880		$	—		—	$	557,232

Weighted average remaining recognition period in years				1.9

Unamortized compensation expense			$	8,259,906


	Nine Months Ended September 30,			Year Ended December 31,
	2017			2016
	(amounts in thousands, except per share data)
Reconciliation Of RSUs With Market Conditions
Beginning of period balance		630			390
Number of RSUs granted		—			470
Number of RSUs forfeited		—			—
Number of RSUs vested		(50	)		(230	)

End of period balance		580			630

Weighted average fair value of RSUs granted with market conditions	$	—		$	7.34


	Nine Months Ended September 30,		Year Ended December 31,
	2017		2016
	(amounts in thousands, except per share data)
Reconciliation Of RSUs With Service And Performance
Conditions
Beginning of period balance		—		29
Number of RSUs granted		—		—
Number of RSUs that did not meet criteria		—		(29	)
Number of RSUs vested		—		—

Average fair value of RSUs granted with performance conditions	$	—	$	—


	Nine Months Ended September 30,
Option Exercise Data	2017		2016
	(amounts in thousands)
Intrinsic value of options exercised	$	58	$	325

Tax benefit from options exercised⁽¹⁾	$	23	$	125

Cash received from exercise price of options exercised	$	22	$	39


				Options Outstanding						Options Exercisable
				Number Of		Weighted				Number Of
				Options		Average		Weighted		Options		Weighted
Range Of				Outstanding		Remaining		Average		Exercisable		Average
Exercise Prices				September 30,		Contractual		Exercise		September 30,		Exercise
From		To		2017		Life		Price		2017		Price
$	1.34	$	1.34		300,437		1.4	$	1.34		300,437	$	1.34
$	2.02	$	11.78		22,125		1.0	$	9.08		22,125	$	9.08

$	1.34	$	11.78		322,562		1.3	$	1.87		322,562	$	1.87


	September 30, 2017				December 31, 2016
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(amounts in thousands)
Term B Loan⁽¹⁾	$	458,000	$	459,718	$	480,000	$	487,200

Revolver⁽²⁾	$	22,500	$	22,500	$	—	$	—

Other debt⁽³⁾	$	74			$	87


	January 6,		Useful Lives In Years
Description	2017		From		To
	(amounts in thousands)
Assets
Land	$	2,539		non-depreciating
Buildings		217		15		25
Equipment		4,569		3		40

Total property plant and equipment		7,325
Deferred tax asset		287		life of underlying asset
Radio broadcasting licenses and goodwill		17,384		non-amortizing

Total assets		24,996

Liabilities
Unfavorable lease liabilities		735		over remaining lease life
Deferred tax liability		261		life of underlying liability

Total liabilities		996

Net assets	$	24,000


		Dividend Equivalent Liabilities
	Balance Sheet Location	September 30, 2017		December 31, 2016
		(amounts in thousands)
Short-term	Other current liabilities	$	446	$	260
Long-term	Other long-term liabilities		637		348

Total		$	1,083	$	608


		Dividend Equivalent Liabilities
	Balance Sheet Location	March 31, 2019		December 31, 2018
		(amounts in thousands)
Short-term	Other current liabilities	$	1,878	$	1,279
Long-term	Other long-term liabilities		888		1,041

Total		$	2,766	$	2,320


	(a) Total Number Of Shares		(b) Average Price Paid		(c) Total Number Of Shares Purchased As Part Of Publicly Announced Plans Or		(d) Maximum Approximate Dollar Value Of Shares That May Yet Be Purchased Under The Plans
Period⁽¹⁾	Purchased		Per Share		Programs		Or Programs
July 1, 2017 - July 31, 2017		3,905	$	9.98		—	$	—
August 1, 2017 - August 31, 2017		410	$	9.85		—	$	—
September 1, 2017 - September 30, 2017		—	$	—		—	$	—

Total		4,315				—


Exhibit Number		Description
~~2.1~~		Agreement and Plan of Merger, dated as of February 2, 2017, by and among CBS Corporation, CBS Radio Inc., Entercom Communications Corp. and Constitution Merger Sub Corp. (Incorporated by reference to Exhibit 2.1 of Entercom’s Current Report on Form 8-K filed on February 3, 2017)

~~2.2~~		Master Separation Agreement, dated as of February 2, 2017, by and between CBS Corporation and CBS Radio Inc. (Incorporated by reference to Exhibit A to Exhibit 2.1 to Entercom’s Current Report on Form 8-K filed on February 3, 2017)

~~2.3~~		Amendment No. 1, dated as of July 10, 2017, to the Agreement and Plan of Merger, dated as of February 2, 2017, by and among CBS Corporation, CBS Radio Inc., Entercom Communications Corp. and Constitution Merger Sub Corp. (incorporated by reference to Exhibit 2.1 of Entercom’s Current Report on Form 8-K filed on July 10, 2017)

~~2.4~~		Amendment No. 2, dated as of September 13, 2017, to the Agreement and Plan of Merger, dated as of February 2, 2017, by and among CBS Corporation, CBS Radio Inc., Entercom Communications corp. and Constitution Merger Sub Corp. (incorporated by reference to Exhibit 2.1 of Entercom’s Current Report on Form 8-K filed on September 13, 2017)

3.1 #		Amended and Restated Articles of Incorporation of Entercom Communications Corp. (Incorporated by reference to Exhibit 3.01 to Entercom’s Amendment to Registration Statementon Form S-1, as filed on January 27, 1999 (FileNo. 333-61381),)

3.2 #		Articles of Amendment to the Articles of Incorporation of Entercom Communications Corp. (Incorporated by reference to Exhibit 3.1 of Entercom’s Current Report on Form8-K as filed on December 21, ~~2007~~2007) ~~and~~

3.3 #		Articles of Amendment to the Articles of Incorporation of Entercom Communications Corp. (Incorporated by reference to Exhibit 3.02 to Entercom’s Quarterly Report on Form10-Q for the quarter ended June 30, 2009, as filed on August 5, 2009).

~~3.2~~3.4 #		Articles of Amendment to the Articles of Incorporation of Entercom Communications Corp. dated November 17, 2017. (Incorporated by reference to Exhibit 3.1 to our Current Report on Form8-K filed on November 17, 2017)

3.5 #		Statement with Respect to Shares, filed with the Pennsylvania Department of State on July 16, 2015. (Incorporated by reference to an Exhibit 3.1 to our Current Report on Form8-K filed on July 17, 2015)

3.6 #		Amended and Restated Bylaws of Entercom Communications Corp. (Incorporated by reference to Exhibit 3.1 to Entercom’s Current Reporton Form 8-K filed on February 21, 2008)

~~3.3~~3.7 #		Amendment No 1 to Amended and Restated Bylaws of Entercom Communications Corp. ~~(incorporated~~(Incorporated by reference to Exhibit 3.1 to our Current Reporton Form 8-K filed on February 3, 2017)

~~3.4~~3.8 #		~~Statement with Respect~~Amendment No 2 to ~~Shares, filed with the Pennsylvania Department~~Amended and Restated Bylaws of ~~State on July 16, 2015.~~Entercom Communications Corp. (Incorporated by reference to an Exhibit ~~3.1~~3.2 to our Current Report on Form8-K filed on ~~July~~November 17, ~~2015)~~2017)

4.1 #		~~Credit Agreement,~~Indenture for Senior Notes, dated as of October 17, 2016, by and among CBS Radio, Inc., the guarantors named therein, and Deutsche Bank Trust Company Americas, as trustee. (Incorporated by reference to Exhibit 4.2 of Entercom’s Registration Statement onForm S-4 (File No. 333-217273))

4.2 #		Supplemental Indenture, dated as of November ~~1, 2016,~~ 17, 2017, by and among Entercom Radio, LLC, the other guarantor parties named therein, and Deutsche Bank Trust Company Americas, as ~~the Borrower, Entercom Communications Corp.,~~trustee. (Incorporated by reference to Exhibit 4.2 to Entercom’s Current Report onForm 8-K filed on November 17, 2017)

4.3 #		Supplemental Indenture, dated December 8, 2017, by and between CBS Radio Inc. and Deutsche Bank Trust Company Americas, as ~~the Parent, Bank of America, N.A. as Administrative Agent and the lenders party thereto.~~trustee (Incorporated by reference to Exhibit 4.1 to our Current Report on Form8-K filed on ~~November 2, 2016)~~December 11, 2017)

~~4.2~~4.4 #		~~Registration Rights Agreement, dated July 16, 2015,~~Indenture for Senior Secured Second-Lien Notes due May 1, 2027, by and ~~between~~among Entercom ~~Communications~~Media Corp., the guarantors named therein, and ~~The Lincoln National Life Insurance Company. ((Incorporated~~Deutsche Bank Trust Company Americas, as trustee. (Incorporated by reference to an Exhibit 4.1 to ~~our~~Entercom’s Current Report on Form8-K filed on ~~July 17, 2015)~~May 1, 2019)

~~10.1~~4.5 #		~~Employment Agreement, dated July 18, 2017, between Entercom Communications Corp. and Louise C. “Weezie” Kramer (*)~~Form of 6.500% Senior Secured Second-Lien Note due 2027 (included in Exhibit 4.1). (Incorporated by reference to Exhibit 4.2 to Entercom’s Current Report on Form8-K filed on May 1, 2019)

31.1 *		Certification of President and Chief Executive Officer required by Rule13a-14(a) or Rule15d-14(a), as created by Section 302 of the Sarbanes-Oxley Act of 2002. ~~(5)~~Filed herewith.

31.2 *		Certification of Executive Vice President and Chief Financial Officer required by Rule13a-14(a) or Rule15d-14(a), as created by Section 302 of the Sarbanes-Oxley Act of 2002. ~~(5)~~Filed herewith.

32.1 ^		Certification of President and Chief Executive Officer pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002. ~~(#)~~

32.2 ^		Certification of Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002. ~~(#)~~


~~Exhibit Number~~		~~Description~~
101.INS		XBRL Instance Document ~~(*)~~

101.SCH		XBRL Taxonomy Extension Schema ~~Document (*)~~

101.CAL		XBRL Taxonomy Extension Calculation Linkbase ~~Document (*)~~

101.DEF		XBRL Taxonomy Extension Definition Linkbase

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company