________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-Q
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Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended Commission file number:
March 31, 2004 333-02302
ALLBRITTON COMMUNICATIONS COMPANY
(Exact name of registrant as specified in its charter)
Delaware 74-1803105
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
808 Seventeenth Street, N.W.
Suite 300
Washington, D.C. 20006-3910
(Address of principal executive offices)
Registrant's telephone number, including area code: 202-789-2130
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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 X (1)
------- -------
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes No X
------- -------
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Number of shares of Common Stock outstanding as of May 13, 2004: 20,000
shares.
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(1) Although the Company has not been subject to such filing requirements for
the past 90 days, it has filed all reports required to be filed by Section
15(d) of the Securities Exchange Act of 1934 during the preceding 12
months. Pursuant to Section 15(d) of the Securities Exchange Act of 1934,
the Company's duty to file reports became automatically suspended as of
October 1, 2003 as a result of having fewer than 300 holders of record of
each class of its debt securities outstanding as of that date, but the
Company has agreed under the terms of certain long-term debt to continue
these filings in the future.
________________________________________________________________________________
CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS
THIS QUARTERLY REPORT ON FORM 10-Q, INCLUDING ITEM 2 "MANAGEMENT'S DISCUSSION
AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS," CONTAINS
FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 21E OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED, THAT ARE NOT HISTORICAL FACTS AND INVOLVE A
NUMBER OF RISKS AND UNCERTAINTIES. THERE ARE A NUMBER OF FACTORS THAT COULD
CAUSE OUR ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE PROJECTED IN SUCH
FORWARD-LOOKING STATEMENTS. THESE FACTORS INCLUDE, WITHOUT LIMITATION, OUR
OUTSTANDING INDEBTEDNESS AND OUR HIGH DEGREE OF LEVERAGE; THE RESTRICTIONS
IMPOSED ON US BY THE TERMS OF OUR INDEBTEDNESS; THE HIGH DEGREE OF COMPETITION
FROM BOTH OVER-THE-AIR BROADCAST STATIONS AND PROGRAMMING ALTERNATIVES SUCH AS
CABLE TELEVISION, WIRELESS CABLE, IN-HOME SATELLITE DISTRIBUTION SERVICE,
PAY-PER-VIEW SERVICES AND HOME VIDEO AND ENTERTAINMENT SERVICES; THE IMPACT OF
NEW TECHNOLOGIES; CHANGES IN FEDERAL COMMUNICATIONS COMMISSION REGULATIONS;
DECREASES IN THE DEMAND FOR ADVERTISING DUE TO WEAKNESS IN THE ECONOMY; AND THE
VARIABILITY OF OUR QUARTERLY RESULTS AND OUR SEASONALITY.
ALL WRITTEN OR ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE COMPANY ARE
EXPRESSLY QUALIFIED BY THE FOREGOING CAUTIONARY STATEMENTS. READERS ARE
CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS WHICH
REFLECT MANAGEMENT'S VIEW ONLY AS OF THE DATE HEREOF.
ALLBRITTON COMMUNICATIONS COMPANY
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2004
TABLE OF CONTENTS
PAGE
PART I FINANCIAL INFORMATION
Item 1. Financial Statements:
Consolidated Statements of Operations and Retained Earnings
for the Three and Six Months Ended March 31, 2003 and 2004.... 1
Consolidated Balance Sheets as of September 30, 2003 and March
31, 2004...................................................... 2
Consolidated Statements of Cash Flows for the Six Months Ended
March 31, 2003 and 2004....................................... 3
Notes to Interim Consolidated Financial Statements............ 4
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations..................................... 7
Item 3. Quantitative and Qualitative Disclosures About Market Risk.... 15
Item 4. Controls and Procedures....................................... 16
PART II OTHER INFORMATION
Item 1. Legal Proceedings............................................. 17
Item 6. Exhibits and Reports on Form 8-K.............................. 17
Signatures.............................................................. 18
Exhibit Index........................................................... 19
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
ALLBRITTON COMMUNICATIONS COMPANY
(an indirectly wholly-owned subsidiary of Perpetual Corporation)
CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(Dollars in thousands)
(unaudited)
Three Months Ended Six Months Ended
March 31, March 31,
------------------ ------------------
2003 2004 2003 2004
---- ---- ---- ----
Operating revenues, net..................... $ 44,448 $ 47,491 $ 102,957 $ 102,287
------ ------ ------- -------
Television operating expenses, excluding
depreciation and amortization.......... 30,653 32,146 62,781 65,932
Depreciation and amortization............... 2,658 2,366 5,247 4,698
Corporate expenses.......................... 1,520 1,028 2,978 2,303
------ ------ ------- -------
34,831 35,540 71,006 72,933
------ ------ ------- -------
Operating income............................ 9,617 11,951 31,951 29,354
------ ------ ------- -------
Nonoperating income (expense)
Interest income
Related party...................... 44 74 88 93
Other.............................. 205 5 325 10
Interest expense....................... (11,004) (9,214) (22,102) (18,391)
Loss on early repayment of debt........ (23,194) -- (23,194) --
Other, net............................. (209) (372) (553) (724)
------ ------ ------- -------
(34,158) (9,507) (45,436) (19,012)
------ ------ ------- -------
(Loss) income before income taxes and
cumulative effect of change in
accounting principle................... (24,541) 2,444 (13,485) 10,342
(Benefit from) provision for income taxes... (8,843) 931 (5,010) 3,832
------ ------ ------- -------
(Loss) income before cumulative effect
of change in accounting principle...... (15,698) 1,513 (8,475) 6,510
Cumulative effect of change in accounting
principle, net of income tax benefit
of $2,027 (Note 2)..................... -- -- 2,973 --
------ ------ ------- -------
Net (loss) income........................... (15,698) 1,513 (11,448) 6,510
Retained earnings, beginning of period...... 9,167 33 4,917 (4,964)
------ ------ ------- -------
Retained earnings, end of period............ $ (6,531) $ 1,546 $ (6,531) $ 1,546
====== ====== ======= =======
See accompanying notes to interim consolidated financial statements.
1
ALLBRITTON COMMUNICATIONS COMPANY
(an indirectly wholly-owned subsidiary of Perpetual Corporation)
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
March 31,
September 30, 2004
2003 (unaudited)
------------- -----------
Assets
Current assets
Cash and cash equivalents........................... $ 3,278 $ 4,553
Accounts receivable, net............................ 38,663 35,712
Program rights...................................... 18,862 8,795
Deferred income taxes............................... 842 842
Other............................................... 2,140 2,079
------- -------
Total current assets........................... 63,785 51,981
Property, plant and equipment, net........................ 53,577 52,160
Intangible assets, net.................................... 122,982 122,899
Deferred financing costs and other........................ 10,004 9,872
Cash surrender value of life insurance.................... 10,848 11,385
Program rights............................................ 814 527
------- -------
$ 262,010 $ 248,824
======= =======
Liabilities and Stockholder's Investment
Current liabilities
Current portion of long-term debt................... $ 237 $ 151
Accounts payable.................................... 2,556 2,434
Accrued interest payable............................ 10,553 10,528
Program rights payable.............................. 22,530 12,848
Accrued employee benefit expenses................... 4,579 3,747
Other accrued expenses.............................. 5,400 5,950
------- -------
Total current liabilities...................... 45,855 35,658
Long-term debt............................................ 467,451 468,486
Program rights payable.................................... 1,443 857
Deferred rent and other................................... 4,148 3,771
Accrued employee benefit expenses......................... 1,970 1,980
Deferred income taxes..................................... 16,943 18,172
------- -------
Total liabilities.............................. 537,810 528,924
------- -------
Stockholder's investment
Preferred stock, $1 par value, 1,000 shares
authorized, none issued.......................... - -
Common stock, $.05 par value, 20,000 shares
authorized, issued and outstanding............... 1 1
Capital in excess of par value...................... 49,631 49,631
Retained earnings................................... (4,964) 1,546
Distributions to owners, net........................ (320,468) (331,278)
------- -------
Total stockholder's investment................... (275,800) (280,100)
------- -------
$ 262,010 $ 248,824
======= =======
See accompanying notes to interim consolidated financial statements.
2
ALLBRITTON COMMUNICATIONS COMPANY
(an indirectly wholly-owned subsidiary of Perpetual Corporation)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(unaudited)
Six Months Ended
March 31,
--------------------
2003 2004
---- ----
Cash flows from operating activities:
Net (loss) income................................................... $ (11,448) $ 6,510
------- -------
Adjustments to reconcile net (loss) income to
net cash provided by operating activities:
Depreciation and amortization.................................... 5,247 4,698
Cumulative effect of change in accounting principle.............. 2,973 --
Other noncash charges............................................ 718 756
Loss on early repayment of debt.................................. 23,194 --
Provision for doubtful accounts.................................. 262 330
(Gain) loss on disposal of assets................................ (9) 16
Changes in assets and liabilities:
(Increase) decrease in assets:
Accounts receivable........................................ 2,040 2,621
Program rights............................................. 10,532 10,353
Other current assets....................................... (919) 62
Other noncurrent assets.................................... (537) (978)
Increase (decrease) in liabilities:
Accounts payable........................................... (480) (122)
Accrued interest payable................................... (3,051) (25)
Program rights payable..................................... (13,496) (10,267)
Accrued employee benefit expenses.......................... (219) (822)
Other accrued expenses..................................... (3,356) 549
Deferred rent and other liabilities........................ 1,428 (377)
Deferred income taxes...................................... 1,445 1,229
------- -------
25,772 8,023
------- -------
Net cash provided by operating activities.................. 14,324 14,533
------- -------
Cash flows from investing activities:
Capital expenditures................................................ (3,440) (3,221)
Proceeds from disposal of assets.................................... 32 7
------- -------
Net cash used in investing activities...................... (3,408) (3,214)
------- -------
Cash flows from financing activities:
Proceeds from issuance of debt...................................... 451,949 --
Principal payments on long-term debt and capital lease obligations.. (425,302) (161)
Draws under line of credit, net..................................... 13,936 1,000
Redemption premiums and related costs of early repayment of debt.... (17,409) --
Deferred financing costs............................................ (9,392) (73)
Distributions to owners, net of certain charges..................... (28,169) (11,175)
Repayments of distributions to owners............................... 3,209 365
------- -------
Net cash used in financing activities...................... (11,178) (10,044)
------- -------
Net (decrease) increase in cash and cash equivalents...................... (262) 1,275
Cash and cash equivalents, beginning of period............................ 6,299 3,278
------- -------
Cash and cash equivalents, end of period.................................. $ 6,037 $ 4,553
======= =======
See accompanying notes to interim consolidated financial statements.
3
ALLBRITTON COMMUNICATIONS COMPANY
(an indirectly wholly-owned subsidiary of Perpetual Corporation)
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands)
(unaudited)
NOTE 1 - The accompanying unaudited interim consolidated financial statements of
Allbritton Communications Company (an indirectly wholly-owned subsidiary of
Perpetual Corporation) and its subsidiaries (collectively, the "Company") have
been prepared pursuant to instructions for Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, certain information and footnote disclosures
normally included in financial statements prepared in conformity with generally
accepted accounting principles have been omitted or condensed where permitted by
regulation. In management's opinion, the accompanying financial statements
reflect all adjustments, which were of a normal recurring nature, and
disclosures necessary for a fair presentation of the consolidated financial
statements for the interim periods presented. The results of operations for the
three and six months ended March 31, 2004 are not necessarily indicative of the
results that can be expected for the entire fiscal year ending September 30,
2004. The interim consolidated financial statements should be read in
conjunction with the audited consolidated financial statements and notes thereto
for the year ended September 30, 2003, which are contained in the Company's Form
10-K.
NOTE 2 - Upon adoption of Statement of Financial Accounting Standards (SFAS) No.
142, "Goodwill and Other Intangible Assets," on October 1, 2002, the Company
performed the first of the required impairment tests on its indefinite lived
intangible assets. As a result of these tests, it was determined that one of the
Company's broadcast licenses was impaired. Accordingly, the Company recorded a
non-cash, after-tax impairment charge of $2,973 related to the carrying value of
its indefinite lived intangible assets. This charge was recorded as a cumulative
effect of a change in accounting principle during the three months ended
December 31, 2002.
The carrying value of the Company's indefinite lived intangible assets,
consisting of broadcast licenses, at September 30, 2003 and March 31, 2004 was
$122,290. The carrying value of the Company's other intangible assets,
consisting of favorable terms on contracts and leases, was as follows:
September 30, March 31,
2003 2004
------------- ---------
Gross carrying amount.................. $ 6,174 $ 6,174
Less accumulated amortization.......... (5,482) (5,565)
----- -----
Net carrying amount.................... $ 692 $ 609
===== =====
Amortization expense was $84 and $83 during the six-month periods ended March
31, 2003 and 2004, respectively.
4
NOTE 3 - On December 20, 2002, the Company issued $275,000 principal amount of
7 3/4% Senior Subordinated Notes due 2012 (the "7 3/4% Notes") at par. The net
proceeds, together with borrowings under the Company's senior credit facility,
were used to purchase and redeem the Company's $275,000 9 3/4% Senior
Subordinated Debentures due 2007 (the "9 3/4% Debentures") as well as to pay the
fees and expenses associated with the offering of the 7 3/4% Notes. As of
January 21, 2003, all of the 9 3/4% Debentures had been purchased or redeemed.
On February 6, 2003, the Company issued an additional $180,000 principal amount
of its 7 3/4% Notes at a price of 98.305%. The net proceeds were used to redeem
the Company's $150,000 8 7/8% Senior Subordinated Notes due 2008 (the "8 7/8%
Notes"), fund the redemption premium for the 8 7/8% Notes, pay the fees and
expenses associated with the offering of the additional 7 3/4% Notes and repay
borrowings outstanding under the Company's senior credit facility. On March 10,
2003, all of the 8 7/8% Notes were redeemed.
As a result of the purchase and redemption of its 9 3/4% Debentures as well as
the redemption of its 8 7/8% Notes, the Company recorded a pre-tax charge of
$23,194 during the quarter ended March 31, 2003. Such charge was reflected as a
nonoperating expense.
NOTE 4 - For the six months ended March 31, 2003 and 2004, distributions to
owners and related activity consisted of the following:
Federal and
Distributions Virginia state Net
to Owners Income Tax Distributions
and Dividends Receivable to Owners
------------- -------------- -------------
Balance as of September 30, 2002................ $ 301,622 $ -- $ 301,622
Cash advances to Perpetual...................... 19,730 19,730
Repayment of cash advances to Perpetual......... (3,209) (3,209)
Benefit from federal and state income taxes..... 6,017 6,017
Payment of income taxes......................... 2,422 2,422
------- ----- -------
Balance as of March 31, 2003.................... $ 318,143 $ 8,439 $ 326,582
======= ===== =======
Balance as of September 30, 2003................ $ 320,468 $ -- $ 320,468
Cash advances to Perpetual...................... 9,580 9,580
Repayment of cash advances to Perpetual......... (365) (365)
Charge for federal and state income taxes....... (2,419) (2,419)
Payment of income taxes......................... 4,014 4,014
------- ----- -------
Balance as of March 31, 2004.................... $ 329,683 $ 1,595 $ 331,278
======= ===== =======
The operations of the Company are included in a consolidated federal income tax
return and a combined Virginia state income tax return filed by Perpetual in
accordance with the terms of a tax sharing agreement between the Company and
Perpetual. For the six months ended March 31, 2003, the Company recorded a
benefit for federal and Virginia state income taxes. The actual net
5
benefit for federal and Virginia state income taxes of $3,957 that existed for
the year ended September 30, 2003 was effectively distributed to Perpetual as of
September 30, 2003 as such benefit would not have been recognized in future
years pursuant to the tax sharing agreement between the Company and Perpetual.
The average amount of non-interest bearing advances outstanding was $309,662 and
$318,418 during the six months ended March 31, 2003 and 2004, respectively.
6
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
(dollars in thousands)
Overview
As used herein, the terms the "Company," "our," "us," or "we" refer to
Allbritton Communications Company and its subsidiaries and "ACC" refers solely
to Allbritton Communications Company.
We own ABC network-affiliated television stations serving seven geographic
markets: WJLA-TV in Washington, D.C.; WCFT-TV in Tuscaloosa, Alabama, WJSU-TV in
Anniston, Alabama and WBMA-LP, a low power television station licensed to
Birmingham, Alabama (we operate WCFT-TV and WJSU-TV in tandem with WBMA-LP
serving the viewers of the Birmingham, Tuscaloosa and Anniston market as a
single programming source); WHTM-TV in Harrisburg, Pennsylvania; KATV in Little
Rock, Arkansas; KTUL in Tulsa, Oklahoma; WSET-TV in Lynchburg, Virginia; and
WCIV in Charleston, South Carolina. We also provide 24-hour per day basic cable
television programming to the Washington, D.C. market, through NewsChannel 8,
primarily focused on regional and local news for the Washington, D.C.
metropolitan area. The operations of NewsChannel 8 are integrated with WJLA.
Our advertising revenues are generally highest in the first and third quarters
of each fiscal year, due in part to increases in retail advertising in the
period leading up to and including the holiday season and active advertising in
the spring. The fluctuation in our operating results is generally related to
fluctuations in the revenue cycle. In addition, advertising revenues are
generally higher during election years due to spending by political candidates,
which is typically heaviest during our first and fourth fiscal quarters.
Fiscal 2003 Financing Transactions
The three and six-month comparative results are impacted by the effect of our
two financing transactions completed during the first half of Fiscal 2003. On
December 20, 2002, we issued $275,000 principal amount of 7 3/4% senior
subordinated notes at par. As of January 21, 2003, we had used the net proceeds
from the offering, together with borrowings under our senior credit facility, to
purchase and redeem all of our outstanding 9 3/4% senior subordinated debentures
as well as to pay the fees and expenses associated with the offering of the
7 3/4% notes.
On February 6, 2003, we issued an additional $180,000 principal amount of our
7 3/4% notes at a price of 98.305%. We used the net proceeds to redeem our
existing 8 7/8% senior subordinated notes, fund the redemption premium for the
8 7/8% notes, pay the fees and expenses associated with the offering of the
additional 7 3/4% notes and repay borrowings outstanding under our senior credit
facility. On March 10, 2003, all of the 8 7/8% notes were redeemed.
The issuance of the 7 3/4% notes and the related purchase and redemption of the
9 3/4% debentures and the redemption of the 8 7/8% notes will reduce our annual
payments of interest on our debt by approximately $5,000. As a result of the
purchase and redemption of our 9 3/4% debentures and the redemption of our
8 7/8% notes, we recorded a pre-tax charge of $23,194 during the quarter ended
March 31, 2003. Such charge was reflected as a nonoperating expense.
7
Results of Operations
Set forth below are selected consolidated financial data for the three and six
months ended March 31, 2003 and 2004 and the percentage change between the
periods:
Three Months Ended March 31, Six Months Ended March 31,
---------------------------- ------------------------------
Percent Percent
2003 2004 Change 2003 2004 Change
---- ---- ------- ---- ---- -------
Operating revenues, net ............ $ 44,448 $ 47,491 6.8% $ 102,957 $ 102,287 -0.7%
Total operating expenses............ 34,831 35,540 2.0% 71,006 72,933 2.7%
------ ------ ------- -------
Operating income.................... 9,617 11,951 24.3% 31,951 29,354 -8.1%
Nonoperating expenses, net.......... 34,158 9,507 -72.2% 45,436 19,012 -58.2%
Income tax (benefit) provision...... (8,843) 931 -- (5,010) 3,832 --
------ ------ ------- -------
(Loss) income before cumulative
effect of change in accounting
principle........................... (15,698) 1,513 -- (8,475) 6,510 --
Cumulative effect of change in
accounting principle, net of
income tax benefit.................. -- -- -- 2,973 -- --
------ ------ -------- -------
Net (loss) income................... $(15,698) $ 1,513 -- $ (11,448) $ 6,510 --
====== ====== ======= =======
Operating cash flow<F1>............. $ 12,275 $ 14,317 16.6% $ 37,198 $ 34,052 -8.5
====== ====== ======= ========
- -------
<FN>
<F1> Operating cash flow is not a measure of performance calculated in
accordance with GAAP. For a definition of operating cash flow and a
reconciliation of operating cash flow to operating income, please refer to
"Operating Cash Flow".
</FN>
Net Operating Revenues
The following table depicts the principal types of operating revenues, net of
agency commissions, earned by us for each of the three and six months ended
March 31, 2003 and 2004, and the percentage contribution of each to our total
broadcast revenues, before fees:
Three Months Ended March 31, Six Months Ended March 31,
---------------------------- --------------------------
2003 2004 2003 2004
---- ---- ---- ----
Dollars Percent Dollars Percent Dollars Percent Dollars Percent
------- ------- ------- ------- ------- ------- ------- -------
Local and national <F1>....... $40,018 87.8 $41,538 85.4 $ 85,456 81.0 $ 90,609 86.6
Political <F2>................ 20 0.1 999 2.0 7,928 7.5 1,491 1.4
Network compensation <F3>..... 1,474 3.2 1,465 3.0 2,870 2.7 2,783 2.7
Trade and barter <F4>......... 1,678 3.7 1,685 3.5 3,483 3.3 3,351 3.2
Other revenue <F5>............ 2,367 5.2 2,948 6.1 5,836 5.5 6,442 6.1
------ ----- ------ ----- ------- ----- ------- -----
Broadcast revenues............ 45,557 100.0 48,635 100.0 105,573 100.0 104,676 100.0
===== ===== ===== =====
Fees <F6>..................... (1,109) (1,144) (2,616) (2,389)
------ ------ ------- -------
Operating revenues, net ...... $44,448 $47,491 $102,957 $102,287
====== ====== ======= =======
<FN>
- ----------
<F1> Represents sale of advertising time to local and national advertisers,
either directly or through agencies representing such advertisers, net of
agency commission.
<F2> Represents sale of advertising time to political advertisers.
<F3> Represents payment by networks for broadcasting or promoting network
programming.
<F4> Represents value of commercial time exchanged for goods and services
(trade) or syndicated programs (barter).
8
<F5> Represents other revenue, principally from cable and direct broadcast
satellite subscriber fees, the sales of University of Arkansas sports
programming to advertisers and radio stations as well as receipts from
tower rental and production of commercials.
<F6> Represents fees paid to national sales representatives and fees paid for
music licenses.
</FN>
Net operating revenues for the three months ended March 31, 2004 totaled
$47,491, an increase of $3,043, or 6.8%, when compared to net operating revenues
of $44,448 for the three months ended March 31, 2003. Net operating revenues
decreased $670, or 0.7%, to $102,287 for the six months ended March 31, 2004 as
compared to $102,957 for the same period in the prior year.
Local and national advertising revenues increased $1,520, or 3.8%, and $5,153,
or 6.0%, during the three and six months ended March 31, 2004, respectively,
versus the comparable periods in Fiscal 2003. Local and national advertising
revenue increased in a majority of our markets during the three and six months
ended March 31, 2004. The increase during the three months ended March 31, 2004
reflected increased demand among local and national advertisers as well as the
effect on the prior year of preemptions of regular programming and advertiser
cancellations related to the beginning of the war in Iraq during March 2003,
partially offset by prior year revenue related to the broadcast of the Super
Bowl by the ABC network in January 2003 (broadcast by the CBS network in 2004).
The increase for the six months ended March 31, 2004 was largely due to the
prior year displacement of local and national advertisers during the peak
political advertising month of October 2002 and the factors discussed above
related to the second fiscal quarter.
Political advertising revenues increased by $979 to $999 for the three months
ended March 31, 2004 as compared to the three months ended March 31, 2003.
Political advertising revenue increased in all of our markets principally due to
advertising related to presidential and local primaries as well as advertising
leading up to the November 2004 Presidential election during the three months
ended March 31, 2004 with no comparable advertising in the second quarter of
Fiscal 2003. Political revenues accelerated in our two Presidential battleground
states (Pennsylvania and Arkansas) once the Democratic nominee became apparent.
Political advertising revenues decreased $6,437, or 81.2%, during the six months
ended March 31, 2004 as compared to the same period in Fiscal 2003. Political
advertising revenue decreased in all but one of our markets due to several
high-profile local political races affecting our markets for the November 2002
elections, which generated substantial revenue in the first quarter of Fiscal
2003 with no comparable races or elections taking place during the first quarter
of Fiscal 2004.
No individual advertiser accounted for more than 5% of our broadcast revenues
during the three or six months ended March 31, 2003 or 2004.
Total Operating Expenses
Total operating expenses for the three months ended March 31, 2004 totaled
$35,540, an increase of $709, or 2.0%, compared to total operating expenses of
$34,831 for the three-month period ended March 31, 2003. This net increase
consisted of an increase in television operating expenses, excluding
depreciation and amortization, of $1,493, a decrease in depreciation and
amortization of $292 and a decrease in corporate expenses of $492.
9
Total operating expenses for the six months ended March 31, 2004 totaled
$72,933, an increase of $1,927, or 2.7%, compared to total operating expenses of
$71,006 for the six-month period ended March 31, 2003. This net increase
consisted of an increase in television operating expenses, excluding
depreciation and amortization, of $3,151, a decrease in depreciation and
amortization of $549 and a decrease in corporate expenses of $675.
Television operating expenses, excluding depreciation and amortization,
increased $1,493 and $3,151, or 4.9% and 5.0%, for the three and six months
ended March 31, 2004, respectively, as compared to the comparable periods in
Fiscal 2003. These increases were due primarily to an overall increase in our
employee compensation and benefits of 5.1% and 5.3% during the three and six
months ended March 31, 2004 as well as an incremental $329 and $618 of
news-related promotional expenses specifically at our Washington, D.C. station.
The overall increases in employee compensation and benefits during the three and
six months ended March 31, 2004 resulted principally from increased news costs
in Washington, D.C. as well as increased sales commissions and health insurance
costs across all of our stations.
Depreciation and amortization expense decreased $292 and $549, or 11.0% and
10.5%, respectively, for the three and six months ended March 31, 2004 versus
the comparable periods in Fiscal 2003. These decreases were principally the
result of decreased depreciation associated with the new WJLA/NewsChannel 8
facility during its second full year of depreciation in Fiscal 2004.
Corporate expenses decreased $492 and $675, or 32.4% and 22.7%, respectively,
for the three and six months ended March 31, 2004 versus the comparable periods
in Fiscal 2003. These decreases were due primarily to decreased key man life
insurance expense.
Operating Income
For the three months ended March 31, 2004, operating income of $11,951 increased
$2,334, or 24.3%, when compared to operating income of $9,617 for the three
months ended March 31, 2003. For the three months ended March 31, 2004, the
operating margin increased to 25.2% from 21.6% for the comparable period in
Fiscal 2003. The increases in operating income and margin during the three
months ended March 31, 2004 were primarily the result of increased net operating
revenues, partially offset by increased television operating expenses, excluding
depreciation and amortization, as discussed above.
Operating income of $29,354 for the six months ended March 31, 2004 decreased
$2,597, or 8.1%, when compared to operating income of $31,951 for the same
period in the prior fiscal year. For the six months ended March 31, 2004, the
operating margin decreased to 28.7% from 31.0% for the comparable period in the
prior fiscal year. The decreases in operating income and margin during the six
months ended March 31, 2004 were primarily the result of increased television
operating expenses, excluding depreciation and amortization, as discussed above.
Operating Cash Flow
Operating cash flow of $14,317 for the three months ended March 31, 2004
increased $2,042, or 16.6%, as compared to $12,275 for the three-month period
ended March 31, 2003. This increase was due primarily to increased net operating
revenues, partially offset by increased television operating expenses, excluding
depreciation and amortization, as discussed above.
10
Operating cash flow of $34,052 for the six months ended March 31, 2004 decreased
$3,146, or 8.5%, as compared to $37,198 for the same period in the prior fiscal
year. The decrease during the six months ended March 31, 2004 was primarily the
result of increased television operating expenses, excluding depreciation and
amortization, as discussed above.
We define operating cash flow as operating income plus depreciation and
amortization. Although operating cash flow is not a measure of performance
calculated in accordance with generally accepted accounting principles ("GAAP"),
we believe it is useful for investors in our debt securities and users of our
financial statements in understanding our results of operations. Management
believes that operating cash flow is useful because it is widely used in the
broadcasting industry as a measure of operating performance and is used by
investors and by analysts who report on the performance of broadcast companies.
Operating cash flow also is generally recognized as a tool in applying valuation
methodologies for companies in the media industry. In addition, management
closely monitors operating cash flow in determining our ability to maintain
compliance with certain financial covenants of our indebtedness. Nevertheless,
you should not consider operating cash flow in isolation from or as a substitute
for operating income, net income, cash flow from operating activities and other
operations or cash flow statement data prepared in accordance with GAAP, or as a
measure of performance or liquidity prepared in accordance with GAAP. Moreover,
because operating cash flow is not a measure calculated in accordance with GAAP,
this performance measure is not necessarily comparable to similarly titled
measures employed by other companies.
The following table provides a reconciliation of operating cash flow (a non-GAAP
financial measure) to operating income (as presented in our statements of
operations):
Three Months Ended March 31, Six Months Ended March 31,
---------------------------- --------------------------
2003 2004 2003 2004
---- ---- ---- ----
Operating income.................. $ 9,617 $11,951 $31,951 $29,354
Add:
Depreciation and amortization..... 2,658 2,366 5,247 4,698
------ ------ ------ ------
Operating cash flow............... $12,275 $14,317 $37,198 $34,052
====== ====== ====== ======
Nonoperating Expenses, Net
Interest Expense. Interest expense of $9,214 for the three months ended March
31, 2004 decreased $1,790, or 16.3%, as compared to $11,004 for the three-month
period ended March 31, 2003. The average balance of debt outstanding, including
capital lease obligations, for the three months ended March 31, 2003 and 2004
was $553,964 and $476,350, respectively, and the weighted average interest rate
on debt was 7.9% and 7.6%, for the three months ended March 31, 2003 and 2004,
respectively.
Interest expense of $18,391 for the six months ended March 31, 2004 decreased
$3,711, or 16.8%, as compared to $22,102 for the comparable period of Fiscal
2003. The average balance of debt outstanding, including capital lease
obligations, for the six months ended March 31, 2003 and 2004 was $516,218 and
$473,303, respectively, and the weighted average interest rate on debt was 8.5%
and 7.6%, for the six months ended March 31, 2003 and 2004, respectively.
11
The decreases in interest expense were primarily due to the reduced weighted
average interest rate on debt in the current year resulting from the two
financing transactions completed during the first half of Fiscal 2003 as well as
the effect on the prior year of incremental interest expense incurred during the
first half of Fiscal 2003 associated with the financing transactions.
Incremental interest expense was incurred related to carrying both the then
newly issued 7 3/4% notes and the 9 3/4% debentures from December 20, 2002
through January 21, 2003 during the redemption notice period. Also, incremental
interest expense was incurred related to carrying both the then newly issued
additional 7 3/4% notes and the 8 7/8% notes from February 6, 2003 through March
10, 2003 during the redemption notice period. Had we purchased or redeemed the
9 3/4% debentures on December 20, 2002 and redeemed the 8 7/8% notes on February
6, 2003, interest expense for the three and six months ended March 31, 2003
would have been $9,189 and $19,542, respectively, resulting in an increase of
$25, or 0.3%, during the three months ended March 31, 2004 and a decrease of
$1,151, or 5.9%, during the six months ended March 31, 2004. The six-month
comparison reflects the lower weighted average interest rate on debt, partially
offset by higher average balances of debt outstanding. The average balance of
debt outstanding, including capital lease obligations, for the three and six
months ended March 31, 2003 would have been $476,554 and $459,942, respectively,
and the weighted average interest rate on debt during the three and six months
ended March 31, 2003 would have been 7.7% and 8.4%, respectively.
Loss on Early Repayment of Debt. As a result of the purchase and redemption of
our 9 3/4% debentures and the redemption of our 8 7/8% notes during the quarter
ended March 31, 2003, we recorded a pre-tax charge of $23,194. Such charge was
reflected as a nonoperating expense.
Income Taxes
The provision for income taxes for the three months ended March 31, 2004 totaled
$931 as compared to the benefit from income taxes of $8,843 for the three months
ended March 31, 2003. The provision for income taxes for the six months ended
March 31, 2004 totaled $3,832, an increase of $8,842 when compared to the
benefit from income taxes of $5,010 for the six months ended March 31, 2003. The
increase in the provision for income taxes during the three and six months ended
March 31, 2004 was primarily due to the effect of the $23,194 loss on early
repayment of debt on the results of operations for the three and six months
ended March 31, 2003.
Cumulative Effect of Change in Accounting Principle
Effective October 1, 2002, we adopted SFAS No. 142, "Goodwill and Other
Intangible Assets." SFAS No. 142 addresses the financial accounting and
reporting for acquired goodwill and other intangible assets. Under the new
rules, goodwill and intangible assets deemed to have indefinite lives are no
longer amortized but are subject to periodic impairment tests. Our indefinite
lived intangible assets consist of broadcast licenses. Other intangible assets
continue to be amortized over their useful lives of 11 to 25 years.
Upon adoption, we performed the first of the required impairment tests on our
indefinite lived intangible assets. The fair value of our broadcast licenses was
determined by applying an estimated market multiple to the broadcast cash flow
generated by the respective market. Market multiples were determined based on
recent transactions within the industry, information available regarding
publicly traded peer companies and the respective station's competitive position
within its market. Appropriate allocation was made to each of the station's
tangible and intangible assets in determining the fair value of the station's
broadcast licenses. As a
12
result of these tests, we determined that one of our broadcast licenses was
impaired. Accordingly, we recorded a non-cash, after-tax impairment charge of
$2,973 related to the carrying value of our indefinite lived intangible assets.
This charge was recorded as a cumulative effect of a change in accounting
principle during the three months ended December 31, 2002.
Net Income
For the three and six months ended March 31, 2004, the Company recorded net
income of $1,513 and $6,510, respectively, as compared to a net loss of $15,698
and $11,448 for the three and six months ended March 31, 2003, respectively. The
increases of $17,211 and $17,958 during the three and six months ended March 31,
2004 were due to the factors discussed above.
Balance Sheet
Significant balance sheet fluctuations from September 30, 2003 to March 31, 2004
consisted of decreases in program rights and program rights payable, reflecting
the annual cycle of the underlying program contracts, which generally begins in
September of each year.
Liquidity and Capital Resources
As of March 31, 2004, our cash and cash equivalents aggregated $4,553, and we
had an excess of current assets over current liabilities of $16,323.
Cash Provided by Operations. Our principal sources of working capital are cash
flow from operations and borrowings under our senior credit facility. As
discussed above, our operating results are cyclical in nature primarily as a
result of seasonal fluctuations in advertising revenues, which are generally
highest in the first and third quarters of each fiscal year. Our cash flow from
operations is also impacted on a quarterly basis by the timing of cash
collections and interest payments on debt. Cash receipts are usually greater
during the second and fourth fiscal quarters as the collection of advertising
revenue typically lags the period in which such revenue is recorded. Scheduled
semi-annual interest payments on our long-term fixed interest rate debt have
been higher during the first and third fiscal quarters, and as a result of the
redemption of our 8 7/8% notes, will now occur only in such quarters. As a
result, our cash flows from operating activities as reflected in our
consolidated financial statements are generally significantly higher during our
second and fourth fiscal quarters, and such quarters comprise a substantial
majority of our cash flows from operating activities for the full fiscal year.
As reported in the consolidated statements of cash flows, our net cash provided
by operating activities was $14,324 and $14,533 for the six months ended March
31, 2003 and 2004, respectively.
Transactions with Owners. We have periodically made advances in the form of
distributions to Perpetual Corporation ("Perpetual"). During the six months
ended March 31, 2003 and 2004, we made cash advances, net of repayments, to
Perpetual of $16,521 and $9,215, respectively. The advances to Perpetual are
non-interest bearing and, as such, do not reflect market rates of
interest-bearing loans to unaffiliated third parties.
13
At present, the primary source of repayment of the net advances is through our
ability to pay dividends or make other distributions, and there is no immediate
intent for the amounts to be repaid. Accordingly, these advances have been
treated as a reduction of stockholder's investment and are described as
"distributions" in our consolidated financial statements.
Under the terms of the agreements relating to our indebtedness, future advances,
distributions and dividends to related parties are subject to certain
restrictions. We anticipate that, subject to such restrictions, applicable law
and payment obligations with respect to our indebtedness, we will make advances,
distributions or dividends to related parties in the future.
During the six months ended March 31, 2003 and 2004, we made interest-bearing
advances of tax payments to Perpetual in accordance with the terms of the tax
sharing agreement between Perpetual and us of $2,422 and $4,014, respectively.
We were charged by Perpetual for federal and state income taxes totaling $2,419
during the six months ended March 31, 2004. During the six months ended March
31, 2003, we were not charged for federal and state income taxes, but rather, we
recorded a benefit for federal and Virginia state taxes of $6,017. Such benefit
was reflected as receivable from Perpetual at March 31, 2003; however, the
actual net benefit of $3,957 that existed for the year ended September 30, 2003
was effectively distributed to Perpetual as we would not have received any
future benefit for federal or Virginia state taxes in accordance with the terms
of our tax sharing agreement.
Stockholder's deficit amounted to $280,100 at March 31, 2004, an increase of
$4,300, or 1.6%, from the September 30, 2003 deficit of $275,800. The increase
was due to a net increase in distributions to owners of $10,810, partially
offset by net income for the period of $6,510.
Indebtedness. Our total debt, including the current portion of long-term debt,
increased from $467,688 at September 30, 2003 to $468,637 at March 31, 2004.
This debt, net of applicable discounts, consisted of $452,196 of 7 3/4% senior
subordinated notes due December 15, 2012, $16,000 of draws under our senior
credit facility and $441 of capital lease obligations at March 31, 2004. The
increase of $949 in total debt from September 30, 2003 to March 31, 2004 was
primarily due to a net increase in draws under our senior credit facility of
$1,000.
Our $70,000 senior credit facility is secured by the pledge of stock of ACC and
its subsidiaries and matures March 27, 2006. Interest is payable quarterly at
various rates from prime plus 0.25% or LIBOR plus 1.50% depending on certain
financial operating tests.
Under the existing borrowing agreements, we are subject to restrictive covenants
that place limitations upon payments of cash dividends, issuance of capital
stock, investment transactions, incurrence of additional obligations and
transactions with affiliates. In addition, under the senior credit facility, we
must maintain compliance with certain financial covenants. The senior credit
facility was amended as of December 10, 2003 to adjust a financial covenant
through March 31, 2004. Compliance with the financial covenants is measured at
the end of each quarter, and as of March 31, 2004, we were in compliance with
those financial covenants. We are also required to pay a commitment fee ranging
from 0.5% to 0.75% per annum based on the amount of any unused portion of the
senior credit facility.
14
The indenture for our long-term debt provides that, whether or not required by
the rules and regulations of the SEC, so long as any senior notes are
outstanding, we, at our expense, will furnish to each holder (i) all quarterly
and annual financial information that would be required to be contained in a
filing with the SEC on Forms 10-Q and 10-K, if we were required to file such
forms, including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and, with respect to the annual financial information
only, a report thereon by our certified independent accountants and (ii) all
current reports that would be required to be filed with the SEC on Form 8-K if
we were required to file such reports. In addition, the indenture also provides
that, whether or not required by the rules and regulations of the SEC, we will
file a copy of all such information and reports with the SEC for public
availability (unless the SEC will not accept such a filing) and make such
information available to securities analysts and prospective investors upon
request. Although our duty to file such reports with the SEC was automatically
suspended pursuant to Section 15(d) of the Securities Exchange Act of 1934,
effective October 1, 2003, we will continue to file such reports in accordance
with the indenture.
Other Uses of Cash. We anticipate that capital expenditures for Fiscal 2004 will
approximate $7,000 and will be primarily for the implementation of DTV service
in our two remaining markets (Birmingham and Harrisburg) and the acquisition of
technical equipment and vehicles to support ongoing operations across our
stations. We expect that the source of funds for these anticipated capital
expenditures will be cash provided by operations and borrowings under the senior
credit facility. Capital expenditures during the six months ended March 31, 2004
totaled $3,221.
Based upon our current level of operations, we believe that available cash,
together with cash flows generated by operating activities and amounts available
under the senior credit facility, will be adequate to meet our anticipated
future requirements for working capital, capital expenditures and scheduled
payments of interest on our debt.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
At March 31, 2004, we had other financial instruments consisting primarily of
long-term fixed interest rate debt. Such debt, with future principal payments of
$455,000, matures December 15, 2012. At March 31, 2004, the carrying value of
such debt was $452,196, the fair value was approximately $472,000 and the
interest rate was 7 3/4%. The fair market value of long-term fixed interest rate
debt is subject to interest rate risk. Generally, the fair market value of fixed
interest rate debt will increase as interest rates fall and decrease as interest
rates rise. We estimate the fair value of our long-term debt by using quoted
market prices, as available, or by discounting the required future cash flows
under our debt using borrowing rates currently available to us. We actively
monitor the capital markets in analyzing our capital raising decisions.
15
Item 4. Controls and Procedures
The Company has performed an evaluation of its disclosure controls and
procedures (as defined by Exchange Act rule 15d-15(e)) as of March 31, 2004.
Based on this evaluation, the Company's Chief Executive Officer and Chief
Financial Officer have concluded that the disclosure controls and procedures are
effective in providing reasonable assurances that material information required
to be in this Form 10-Q is made known to them by others on a timely basis.
There were no changes in the Company's internal control over financial reporting
during the quarter ended March 31, 2004 that have materially affected, or are
reasonably likely to materially affect, the Company's internal control over
financial reporting.
16
Part II - OTHER INFORMATION
Item 1. Legal Proceedings
We currently and from time to time are involved in litigation incidental to the
conduct of our business, including suits based on defamation and employment
activity. We are not currently a party to any lawsuit or proceeding which, in
our opinion, if decided adverse to us, would be likely to have a material
adverse effect on our consolidated financial condition, results of operations or
cash flows.
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
See Exhibit Index on pages 19-21.
b. Reports on Form 8-K
No reports on Form 8-K were filed during the quarter.
17
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.
ALLBRITTON COMMUNICATIONS COMPANY
(Registrant)
May 13, 2004 /s/ Robert L. Allbritton
- ------------------------------ --------------------------------------
Date Name: Robert L. Allbritton
Title: Chairman and Chief
Executive Officer
May 13, 2004 /s/ Stephen P. Gibson
- ------------------------------ --------------------------------------
Date Name: Stephen P. Gibson
Title: Senior Vice President
and Chief Financial Officer
18
EXHIBIT INDEX
Exhibit No. Description of Exhibit Page No.
----------- ---------------------- --------
1.1 Purchase Agreement dated December 6, 2002 by and among *
ACC, Deutsche Bank Securities Inc. and Fleet Securities,
Inc. (Incorporated by reference to Exhibit 1 of the
Company's Form 10-K, No. 333-02302, dated December 17,
2002)
1.2 Purchase Agreement dated January 28, 2003 by and among *
ACC, Deutsche Bank Securities Inc. and Fleet Securities,
Inc. (Incorporated by reference to Exhibit 1.2 of the
Company's Quarterly Report on Form 10-Q, No. 333-02302,
dated February 3, 2003)
3.1 Certificate of Incorporation of ACC. (Incorporated by *
reference to Exhibit 3.1 of Company's Registration
Statement on Form S-4, No. 333-02302, dated March 12,
1996)
3.2 Bylaws of ACC. (Incorporated by reference to Exhibit 3.2 *
of Registrant's Registration Statement on Form S-4, No.
333-02302, dated March 12, 1996)
4.1 Indenture dated as of December 20, 2002 between ACC and *
State Street Bank and Trust Company, as Trustee, relating
to the 7 3/4% Senior Subordinated Notes due 2012.
(Incorporated by reference to Exhibit 4.1 of the Company's
Report on Form 8-K, No. 333-02302, dated December 23,
2002)
4.2 Supplemental Indenture dated as of February 6, 2003 *
between ACC and U.S. Bank National Association
(successor-in-interest to State Street Bank and Trust
Company), as Trustee, to the Indenture dated as of
December 20, 2002 between ACC and State Street Bank and
Trust Company, as Trustee, relating to the 7 3/4% Senior
Subordinated Notes due 2012. (Incorporated by reference to
Exhibit 4.1 of the Company's Report on Form 8-K, No.
333-02302, dated February 6, 2003)
4.3 Form of 7 3/4% Series B Senior Subordinated Notes due *
2012. (Incorporated by reference to Exhibit 4.7 of the
Company's Quarterly Report on Form 10-Q, No. 333-02302,
dated February 3, 2003)
4.4 Amended and Restated Revolving Credit Agreement dated as *
of March 27, 2001 by and among Allbritton Communications
Company, certain financial institutions, and Fleet
National Bank, as Agent, and Deutsche Banc Alex. Brown
Inc., as Documentation Agent. (Incorporated by reference
to Exhibit 4.4 of the Company's Quarterly Report on Form
10-Q, No. 333-02302, dated May 10, 2001)
19
Exhibit No. Description of Exhibit Page No.
----------- ---------------------- --------
4.5 First Amendment dated as of December 19, 2001 to the *
Amended and Restated Revolving Credit Agreement.
(Incorporated by reference to Exhibit 4.5 of the Company's
Form 10-K, No. 333-02302, dated December 27, 2001)
4.6 Second Amendment dated as of May 15, 2002 to the Amended *
and Restated Revolving Credit Agreement. (Incorporated by
reference to Exhibit 4.6 of the Company's Quarterly Report
on Form 10-Q, No. 333-02302, dated August 14, 2002)
4.7 Third Amendment dated as of December 6, 2002 to the *
Amended and Restated Revolving Credit Agreement.
(Incorporated by reference to Exhibit 4.6 of the Company's
Form 10-K, No. 333-02302, dated December 17, 2002)
4.8 Fourth Amendment dated as of December 10, 2003 to the *
Amended and Restated Revolving Credit Agreement.
(Incorporated by reference to Exhibit 4.8 of the Company's
Form 10-K, No. 333-02302, dated December 12, 2003)
10.1 Registration Rights Agreement by and among ACC, Deutsche *
Bank Securities Inc. and Fleet Securities Inc. dated
December 20, 2002. (Incorporated by reference to Exhibit
10.1 of the Company's Quarterly Report on Form 10-Q, No.
333-02302, dated February 3, 2003)
10.2 Registration Rights Agreement by and among ACC, Deutsche *
Bank Securities Inc. and Fleet Securities Inc. dated
February 6, 2003. (Incorporated by reference to Exhibit
10.2 of the Company's Registration Statement on Form S-4,
No. 333-02302, dated April 11, 2003)
10.3 Primary Television Affiliation Agreement (WSET,
Incorporated). (with a schedule attached for other
stations' substantially identical affiliation agreements)**
10.4 Tax Sharing Agreement effective as of September 30, 1991 *
by and among Perpetual Corporation, ACC and ALLNEWSCO,
Inc., amended as of October 29, 1993. (Incorporated by
reference to Exhibit 10.11 of Company's Registration
Statement on Form S-4, No. 333-02302, dated March 12,
1996)
10.5 Second Amendment to Tax Sharing Agreement effective as of *
October 1, 1995 by and among Perpetual Corporation, ACC
and ALLNEWSCO, Inc. (Incorporated by reference to Exhibit
10.9 of the Company's Form 10-K, No. 333-02302, dated
December 22, 1998)
20
Exhibit No. Description of Exhibit Page No.
----------- ---------------------- --------
10.6 Master Equipment Lease Agreement dated as of November 22, *
2000 between Fleet Capital Corporation and ACC.
(Incorporated by reference to Exhibit 10.19 of the
Company's Form 10-K, No. 333-02302, dated December 28,
2000)
10.7 Amended and Restated Pledge Agreement dated as of March *
27, 2001 by and among ACC, Allbritton Group, Inc.,
Allfinco, Inc., and Fleet National Bank, as Agent.
(Incorporated by reference to Exhibit 10.20 of the
Company's Quarterly Report on Form 10-Q, No. 333-02302,
dated May 10, 2001)
10.8 Supplement No. 1 dated as of December 13, 2002 to the *
Amended and Restated Pledge Agreement dated as of March
27, 2001 by and among ACC, Allbritton Group, Inc.,
Allfinco, Inc. and Fleet National Bank, as Agent.
(Incorporated by reference to Exhibit 10.15 of the
Company's Quarterly Report on Form 10-Q, No. 333-02302,
dated February 3, 2003)
10.9 Joinder Agreement dated as of December 13, 2002 by ACC *
Licensee, Inc. to the Amended and Restated Pledge
Agreement dated as of March 27, 2001 by and among ACC,
Allbritton Group, Inc., Allfinco, Inc. and Fleet National
Bank, as Agent. (Incorporated by reference to Exhibit
10.16 of the Company's Quarterly Report on Form 10-Q, No.
333-02302, dated February 3, 2003)
14. Code of Ethics for Senior Financial Officers. *
(Incorporated by reference to Exhibit 14 of the Company's
Form 10-K, No. 333-02302, dated December 12, 2003)
31.1 Certification of Chairman and Chief Executive Officer
pursuant to Rule 15d-14(a) of the Securities Exchange Act
of 1934, as amended.
31.2 Certification of Senior Vice President and Chief Financial
Officer pursuant to Rule 15d-14(a) of the Securities
Exchange Act of 1934, as amended.
- -----------------
*Previously filed
**Portions have been omitted pursuant to a request for confidential treatment