TRIPLE CROWN MEDIA, INC.
546 EAST MAIN STREET
LEXINGTON, KENTUCKY 40508
November 10, 2005
VIA ELECTRONIC TRANSMISSION
AND OVERNIGHT COURIER
Larry Spirgel, Esq.
Assistant Director
United States Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0406
Re: Triple Crown Media, Inc.
Registration Statement on Form S-4, File No. 333-128720
Dear Mr. Spirgel:
Reference is made to the comments of the staff (the "Staff") of the Securities
and Exchange Commission (the "Commission") with respect to the above referenced
Registration Statement on Form S-4 (the "Registration Statement") of Triple
Crown Media, Inc., a Delaware corporation (the "Company" or "TCM"), in your
letter dated November 1, 2005 (the "Comment Letter").
We have filed Amendment No. 2 to the Registration Statement today with the
Commission. I am writing to respond to the comments of the Staff and to indicate
the changes that have been made in the Registration Statement. Eight clean
copies of the Registration Statement, without exhibits and eight marked courtesy
copies are enclosed for your reference. The marked copies show the changes since
the filing of Amendment No. 1 to the Registration Statement on October 21,
2005.
For your convenience, your comments are set forth in this letter, followed by
our responses.
Risk Factors, page 30
1. Please refer to prior comment 13 and revise the following risk factor
headings so that the specific risk that results from the uncertainty is
clear:
TCM's advertising revenue is subject to seasonal fluctuations . . .,
page 34
TCM operates in the newspaper and wireless industries . . ., page 34;
TCM may be required to take an impairment charge . . ., page 37; and
After the separation, certain members of management . . ., page 41
Larry Spirgel, Esq.
Securities and Exchange Commission
November 10, 2005
Page 2
WE HAVE REVISED THE REGISTRATION STATEMENT IN RESPONSE TO THE STAFF'S
COMMENT. IN ADDITION, UPON FURTHER REFLECTION, TCM HAS DETERMINED THAT
THE RISK FACTOR REGARDING SEASONAL FLUCTUATIONS IN TCM'S ADVERTISING
REVENUE IS NOT APPLICABLE. IN 2004, APPROXIMATELY 27% OF TCM'S
ADVERTISING REVENUE WAS DERIVED IN THE FOURTH QUARTER AND 23% OF TCM'S
ADVERTISING REVENUE WAS DERIVED IN THE FIRST QUARTER. THE SECOND AND
THIRD QUARTER OF 2004 EACH ACCOUNTED FOR 25% OF TCM'S ADVERTISING
REVENUE. THE PERCENTAGE OF REVENUE EARNED IN THE FOURTH AND FIRST
QUARTER OF 2003 AND 2002 IS CONSISTENT WITH THE PERCENTAGES EARNED IN
THE FOURTH AND FIRST QUARTER OF 2004. BASED UPON THE FOREGOING, TCM
DOES NOT BELIEVE THAT SEASONAL FLUCTUATIONS ARE A MATERIAL RISK TO TCM.
2. You provide generic conclusions in both the heading and text of several
of the risk factors you have revised, stating that, if those risks
materialize, they may have an adverse effect on your "financial
condition and results of operations." See, for example, "TCM's
inability to obtain an adequate supply of newsprint . . ." on page 35,
"TCM may incur significant capital and operating expenditures . . ." on
page 37 and "Bull Run may incur significant capital and operating
expenditures . . ." on page 40. This often does not represent
meaningful disclosure. Instead, we encourage you to replace this
language in both the headings and text of your risk factors with
specific disclosure of the possible affect upon your operating results,
business, profits, share price, sales, etc. See Item 503(c) of
Regulation S-K.
WE HAVE REVISED THE REGISTRATION STATEMENT IN RESPONSE TO THE STAFF'S
COMMENT.
The Merger, page 52
Background of the Merger, page 53
3. We note your disclosure that the July 15 term sheet proposed the
exchange of cash advances by Mr. Robinson for shares of TCM common
stock and that the revised term sheet dated July 22nd contained a
proposal for the conversion of Mr. Robinson's cash advances into the
new class of TCM convertible preferred stock. Please clarify how the
July 22nd term sheet addressed the differences remaining that you
reference between Bull Run's July 15 term sheet and TCM's July 14 term
sheet.
WE HAVE REVISED THE REGISTRATION STATEMENT IN RESPONSE TO THE STAFF'S
COMMENT.
Larry Spirgel, Esq.
Securities and Exchange Commission
November 10, 2005
Page 3
Bull Run's Reasons for the Merger . . ., page 64
4. We note your added disclosure in response to our prior comment 32. In
this regard, you disclose that the special committee, at a particular
meeting, "discussed the risks associated with a merger with TCM, as
well as the recommendations it might make if TCM proposed highly
disadvantageous merger terms" and you also state that special committee
reviewed potential alternatives that "in the opinion of the Bull Run
Special Committee, realistic and not realistic." Please revise to
disclose the specific negative factors that the Bull Run board and
special committee considered. Your disclosure of what consideration the
Bull Run special committee and Bull Run's board gave to potentially
adverse factors should not merely summarize a discussion of a
particular meeting and should be presented in the same bullet point
format as the presentation of the reasons that weighed in favor of the
merger.
WE HAVE REVISED THE REGISTRATION STATEMENT IN RESPONSE TO THE STAFF'S
COMMENT.
Opinion of the Financial Advisor of the Bull Run Special Committee, page 65
5. We note your response to our prior comment 34. If projections were
exchanged among the parties and were deemed material by the SunTrust
Robinson Humphrey, investors are entitled to consider them. Please
revise your disclosure to include this information as previously
requested.
WE HAVE REVISED THE REGISTRATION STATEMENT TO DISCLOSE THE PROJECTIONS
OF EACH OF BULL RUN AND TCM THAT WERE EXCHANGED AMONG THE PARTIES AND
PROVIDED TO THEIR FINANCIAL ADVISORS, AND WHICH THE BULL RUN SPECIAL
COMMITTEE AND TCM SPECIAL COMMITTEE DEEMED TO BE MATERIAL.
Representations and Warranties, page 99
6. We note your response to prior comment 44. Please revise the last
sentence of this section, and elsewhere as appropriate, to clarify that
the reason you are cautioning investors is that the agreement is
modified by the disclosure schedules.
WE HAVE REVISED THE REGISTRATION STATEMENT TO CLARIFY THAT THE REASON
WE ARE CAUTIONING INVESTORS IS THAT THE REPRESENTATIONS AND WARRANTIES
IN THE MERGER AGREEMENT ARE MODIFIED BY THE DISCLOSURE SCHEDULES.
Larry Spirgel, Esq.
Securities and Exchange Commission
November 10, 2005
Page 4
Management's Discussion and Analysis of Financial Condition and Results of
Operations, page 133
Liquidity and Capital Resources, page 138.
7. We note your response to prior comment 46, however, please see prior
comment 48 and quantify your long-term cash requirements. Also,
quantify the expected amount of cash required to service the debt.
Disclosure regarding the proposed funding may be made without violating
the federal securities laws (See e.g. Rule 135c).
WE HAVE REVISED THE REGISTRATION STATEMENT TO QUANTIFY OUR LONG-TERM
CASH REQUIREMENTS AND THE EXPECTED AMOUNT OF CASH REQUIRED TO SERVICE
THE DEBT. IN ADDITION, WE HAVE REVISED THE REGISTRATION STATEMENT TO
DISCLOSE THAT THE OTHER FINANCING ALTERNATIVE THAT TCM IS CURRENTLY
CONSIDERING IS A PRIVATE PLACEMENT OF NOTES TO QUALIFIED INSTITUTIONAL
BUYERS PURSUANT TO RULE 144A OF THE SECURITIES ACT.
Bull Run's Business, page 169
8. We note your response to prior comment 54. Quantify the guaranteed
rights fees that you pay so that investors can better assess the
economics of these agreements.
WE HAVE REVISED THE REGISTRATION STATEMENT TO QUANTIFY THE GUARANTEED
RIGHTS FEES THAT BULL RUN CORPORATION PAID DURING THE YEAR ENDED AUGUST
31, 2005.
Annexes
9. We note your response to prior comment 58. We also note that the merger
agreement refers to various schedules. Accordingly, it appears that you
must comply with the requirements of Item 601(b)(2). Alternatively,
please furnish to us the schedules for our review.
COUNSEL FOR TCM WILL SUPPLEMENTALLY PROVIDE (ON BEHALF OF TCM AND BULL
RUN CORPORATION) ON A CONFIDENTIAL BASIS FOR THE SUPPLEMENTAL
INFORMATION OF THE STAFF, A COPY OF (i) THE TCM DISCLOSURE LETTER DATED
AS OF AUGUST 2, 2005 AND (ii) THE BULL RUN CORPORATION DISCLOSURE
LETTER DATED AS OF AUGUST 2, 2005. THESE MATERIALS WILL BE PROVIDED IN
ACCORDANCE WITH RULE 12B-4 UNDER THE SECURITIES EXCHANGE ACT, AND RULE
418(b) UNDER THE SECURITIES ACT, AND SHALL NOT BE DEEMED FILED WITH OR
PART OF THE PROXY STATEMENT/PROSPECTUS/INFORMATION STATEMENT OR THE
REGISTRATION
Larry Spirgel, Esq.
Securities and Exchange Commission
November 10, 2005
Page 5
STATEMENT OF WHICH THE PROXY STATEMENT/PROSPECTUS/INFORMATION STATEMENT
FORMS A PART. IN THIS SUBMISSION, COUNSEL FOR TCM WILL REQUEST (ON
BEHALF OF TCM AND BULL RUN CORPORATION) PURSUANT TO RULE 12B-4 AND RULE
418(b), THAT THE MATERIALS FURNISHED BE RETURNED TO COUNSEL FOR TCM
UPON COMPLETION OF THE STAFF'S REVIEW.
Exhibits
10. We disagree with the analysis you have provided in response to prior
comment 60. Like with a fairness opinion, you are receiving an opinion
of an expert that is a material condition to the merger. Accordingly,
like a fairness opinion, you must file this opinion as an exhibit to
the registration statement. Please confirm in your response letter that
the solvency opinion will be filed as an exhibit to the registration
statement in a post-effective amendment.
WE HAVE ATTACHED A COPY OF THE LETTER DATED NOVEMBER 4, 2005 THAT
COUNSEL FOR HOULIHAN LOKEY HOWARD & ZUKIN SUPPLEMENTALLY PROVIDED TO
THE STAFF IN RESPONSE TO THE STAFF'S COMMENT.
Consents of Independent Registered Public Accounting Firm
11. We remind you to file the updated consents in your next amendment to
the registration statement.
THE UPDATED CONSENTS OF PRICEWATERHOUSECOOPERS LLP HAVE BEEN INCLUDED
IN AMENDMENT NO. 2 TO THE REGISTRATION STATEMENT.
* * * * * *
We would appreciate your prompt review of these materials and your prompt
notification to us if you have further comments or questions. Please contact
Arnold S. Jacobs of Proskauer Rose LLP at (212) 969-3210 should you have any
questions or additional comments.
Very truly yours,
TRIPLE CROWN MEDIA, INC.
By: /s/ James C. Ryan
--------------------------
James C. Ryan
Chief Financial Officer
cc: Dean Suehiro, Senior Staff Accountant
Kyle Moffatt, Accountant Branch Chief
Albert Pappas, Senior Staff Attorney
Robert S. Prather, Jr.
Marlon F. Starr, Esq.