1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1999
OR
[ ] 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 0-15392
REGENT COMMUNICATIONS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 31-1492857
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
50 EAST RIVERCENTER BOULEVARD
SUITE 180
COVINGTON, KENTUCKY 41011
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(ZIP CODE)
(606) 292-0030
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
----------------------------------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter periods that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
Indicate the number of shares outstanding of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock - $.01 Par Value - 240,000 shares as of May 14, 1999.
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REGENT COMMUNICATIONS, INC.
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1999
INDEX
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statement of Operations for the three
months ended March 31, 1999 (unaudited) and March 31, 1998
(unaudited)
Condensed Consolidated Balance Sheets as of
March 31, 1999 (unaudited) and December 31, 1998
Condensed Consolidated Statements of Cash Flows for three months
ended March 31, 1999 (unaudited) and March 31, 1998
(unaudited)
Notes to Condensed Consolidated Financial Statements (unaudited)
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
PART II - OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds
Item 6. Exhibits and Reports on Form 8-K
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
REGENT COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended
March 31,
---------------------------------------------------------
1999 1998
---- ----
Gross broadcast revenues $4,825,924 $1,613,205
Less agency commissions (305,934) (148,128)
------------ ----------
Net broadcast revenues 4,519,990 1,465,077
Station operating expenses 3,788,465 1,098,911
Depreciation and amortization 771,709 290,648
Corporate general and
administrative expense 615,021 113,528
------------ ----------
Operating loss (655,205) (38,010)
Interest expense 862,466 503,770
Other income, net 83,136 12,152
------------ ----------
Loss before income taxes ($1,434,535) ($529,628)
Income tax expense 0 12,000
------------ ----------
Net loss ($1,434,535) ($541,628)
------------ ----------
Loss applicable to common shares:
Net loss ($1,434,535) ($541,628)
Preferred stock dividend
requirements (1,000,060) 0
------------ ----------
Loss applicable to common shares ($2,434,595) ($541,628)
------------ ----------
Basic and diluted loss per common share ($10.14) ($2.26)
------------ ----------
Weighted average number of common 240,000 240,000
shares used in basic and diluted
calculations
The accompanying notes are an integral part of the
condensed consolidated financial statements.
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REGENT COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31, 1999 December 31, 1998
-------------- -----------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 2,484,966 $ 478,545
Accounts receivable, less allowance for doubtful accounts of $263,000
in 1999 and $268,000 in 1998 3,041,846 3,439,372
Other current assets 250,998 200,828
Assets held for sale 6,000,000 7,500,000
------------ ------------
Total current assets 11,777,810 11,618,745
Property and equipment, net 9,454,124 9,303,975
Intangibles, net 44,636,830 45,023,940
Other assets, net 1,863,764 1,671,210
------------ ------------
Total assets $ 67,732,528 $ 67,617,870
============ ============
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
Accounts payable $ 1,265,323 $ 1,005,327
Accrued expenses 1,501,537 2,772,612
Interest payable 769,730 769,367
Notes payable 6,000,000 7,500,000
Current portion of long-term debt 65,000 980,000
------------ ------------
Total current liabilities 9,601,590 13,027,306
------------ ------------
Long-term debt, less current portion 34,601,250 34,617,500
Warrants and other long-term liabilities 2,643,579 2,643,579
------------ ------------
Total liabilities 46,846,419 50,288,385
Commitments and contingencies
Redeemable preferred stock:
Series A convertible preferred stock, $5.00 stated value, 620,000 shares authorized;
620,000 shares issued and outstanding-liquidation value: $3,486,616 3,486,616 3,433,109
Series B senior convertible preferred stock, $5.00 stated value, 1,000,000 shares
authorized; 1,000,000 shares issued and outstanding-liquidation value: $5,483,013 5,483,013 5,372,054
Series D convertible preferred stock, $5.00 stated value, 1,000,000 shares authorized;
1,000,000 shares issued and outstanding-liquidation value: $5,317,742 5,317,742 5,231,441
Series F convertible preferred stock, $5.00 stated value, 4,100,000 shares authorized;
3,083,652 shares issued and outstanding-liquidation value: $16,356,451 16,356,451 12,839,454
Series G convertible preferred stock, $5.00 stated value, 4,000,000 shares authorized;
372,406 shares issued and outstanding-liquidation value: $1,902,842 1,902,842 -0-
------------ ------------
Total redeemable preferred stock 32,546,664 26,876,058
Shareholders' deficit:
Preferred stock:
Series C convertible preferred stock, $5.00 stated value, 4,000,000 shares authorized;
3,720,620 shares issued and outstanding-liquidation value: $19,632,386 1,584,820 1,584,820
Series E convertible preferred stock, $5.00 stated value, 5,000,000 shares authorized;
447,842 shares issued and outstanding-liquidation value: $2,363,102 2,239,210 2,239,210
Common stock, $.01 par value, 30,000,000 shares authorized;
240,000 shares issued and outstanding 2,400 2,400
Additional paid-in capital 3,268,937 3,948,384
Retained deficit (18,755,922) (17,321,387)
------------ ------------
Total shareholders' deficit (11,660,555) (9,546,573)
------------ ------------
Total liabilities and shareholders' deficit $ 67,732,528 $ 67,617,870
============ ============
The accompanying notes are an integral part of these financial statements.
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REGENT COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended March 31.
----------------------------
1999 1998
---- ----
Cash flows from operating activities:
Net loss ($1,434,535) ($541,628)
Adjustments to reconcile net income (loss) to net cash provided
by operating activities:
Depreciation and amortization 771,709 290,548
Amortization of deferred rental income (8,502) (8,502)
Provision for doubtful accounts 41,366 -0-
Amortization of deferred financing costs 81,750 -0-
Barter, net (27,017) -0-
Increase(decrease) in cash flows from changes in operating assets
and liabilities:
Accounts receivable 362,489 271,796
Prepaid expenses and other assets (50,170) (31,805)
Accounts payable 266,585 15,106
Accrued expenses (1,262,573) 191,145
Taxes payable -0- 18,473
Interest payable 363 195,413
----------- -----------
Net cash (used in) provided by operating activities (1,258,535) 400,546
Cash flows from investing activities:
Acquisitions of radio stations, net of cash acquired (104,035) (1,385,946)
Capital expenditures (416,613) (46,898)
Escrow deposit for acquisition of radio station -0- 100,000
----------- -----------
Net cash used in investing activities (520,648) (1,332,844)
Cash flows from financing activities:
Proceeds from issuance of Series F and G Convertible
Preferred Stock 5,030,290 -0-
Proceeds from long-term debt -0- 1,100,000
Principal payments on and purchase of long-term debt (931,250) (95,002)
Payments for deferred financing costs (274,304) (83,831)
Payment of issuance costs (39,132) -0-
----------- -----------
Net cash provided by financing activities 3,785,604 921,167
----------- -----------
Net increase (decrease) in cash and cash equivalents 2,006,421 (11,131)
Cash and cash equivalents at beginning of period 478,545 535,312
----------- -----------
Cash and cash equivalents at end of period $ 2,484,966 $ 524,181
=========== ===========
The accompanying notes are an integral part of these financial statements.
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REGENT COMMUNICATIONS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
Regent Communications, Inc. (including its wholly-owned
subsidiaries, the "Company") was formed to acquire, own and operate radio
stations in small and medium-sized markets in the United States. The Company
acquired on June 15, 1998, pursuant to an agreement of merger, all of the
outstanding common stock of Faircom Inc. ("Faircom") for 3,720,620 shares of the
Company's Series C Convertible Preferred Stock. The acquisition has been treated
for accounting purposes as the acquisition of the Company by Faircom under the
purchase method of accounting, with Faircom as the accounting acquirer.
Consequently, the historical financial statements prior to June 15, 1998 are
those of Faircom. Faircom operated radio stations through its wholly-owned
subsidiaries in Flint, Michigan and, in Mansfield, Ohio. As a result of the
Faircom merger, Faircom's historical shareholder deficit and earnings per share
information have been retroactively restated to reflect the number of common
shares outstanding subsequent to the merger, with the difference between the par
value of the Company's and Faircom's common stock recorded as an offset to
additional paid-in capital.
The condensed consolidated financial statements of the Company
have been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission (SEC) and, in the opinion of management, include all
adjustments necessary for a fair presentation of the results of operations,
financial position and cash flows for each period shown. All adjustments are of
a normal and recurring nature except for those outlined in Notes 2 and 3.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to SEC rules and regulations. Results
for interim periods may not be indicative of results for the full year. The
December 31, 1998 condensed consolidated balance sheet was derived from
audited financial statements but does not include all disclosures required by
generally accepted accounting principles. It is suggested that these financial
statements be read in conjunction with the financial statements and notes
thereto included in the Company's Form 10-K filed March 31, 1999.
2. CONSUMMATED AND PENDING ACQUISITIONS AND DIVESTITURES
On June 15, 1998, concurrent with the Faircom merger, the
following acquisitions (the "June 15 Acquisitions") were consummated:
The Company acquired all of the outstanding capital stock of The
Park Lane Group ("Park Lane") for approximately $24,038,000 in cash and
assumed liabilities. Park Lane owned 16 radio stations in California and
Arizona. At the time of the acquisition, the Company entered into a
one-year consulting and non-competition agreement with the President of
Park Lane, providing for the payment of a fee of $200,000.
The Company acquired the licenses issued by the Federal
Communications Commission ("FCC") and related assets used in the
operation of radio stations KIXW (AM) and KZWY (FM) in Apple Valley,
California from Ruby Broadcasting, Inc. ("Ruby") for $5,985,000 in cash.
The Company acquired the FCC licenses and related assets used in
the operation of radio stations KFLG (AM) and KFLG (FM) in Bullhead
City, Arizona from Continental Radio Broadcasting, L.L.C. for
approximately $3,747,000 in cash. The Company separately acquired the
accounts receivables of these stations for an additional purchase price
of approximately $130,000.
The Company acquired all of the outstanding capital stock of Alta
California Broadcasting, Inc. ("Alta") for $2,635,000 in cash and
assumed liabilities and 205,250 shares of the Company's Series E
Convertible Preferred Stock. Alta owned four radio stations in
California.
The Company acquired all of the outstanding capital stock of
Topaz Broadcasting, Inc. ("Topaz"), an affiliate of Ruby, for 242,592
shares of the Company's Series E Convertible Preferred Stock.
Immediately following the acquisition of Topaz, the Company acquired the
FCC licenses and operating assets of radio station KIXA (FM) in Lucerne
Valley, California for $215,000 in cash and assumed liabilities,
pursuant to an Asset Purchase Agreement between Topaz and RASA
Communications Corp.
The June 15 Acquisitions were accounted for under the purchase
method of accounting and the fair value of the acquired assets were determined
by independent valuations.
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The Company allocated the aggregate purchase price for the June
15 Acquisitions as follows:
Accounts receivable $ 143,000
Broadcasting equipment and furniture and fixtures 6,503,000
FCC licenses 30,328,000
Goodwill 1,853,000
Other 360,000
------------
$ 39,187,000
============
Goodwill and FCC licenses related to the June 15 Acquisitions are being
amortized over a 40-year period.
The sources for the cash portion of the consideration paid by
the Company for the June 15 Acquisitions and the Faircom merger, aggregating
approximately $52,900,000 (including approximately $21,100,000 of assumed debt
refinanced with borrowings under the Company's senior reducing revolving credit
facility and $3,700,000 of transaction costs), were $34,400,000 borrowed under
the Company's senior reducing revolving credit facility, $18,150,000 in
additional equity from the sale of the Company's convertible preferred stock and
approximately $350,000 of the Company's funds.
On November 30, 1998, the Company purchased substantially all of
the assets of radio station KOSS (FM) (formerly KAVC (FM)) located in Lancaster,
California from Oasis Radio, Inc. for $1,600,000 in cash. The acquisition was
financed through the issuance of additional shares of Series F convertible
preferred stock. The acquisition was accounted for under the purchase method of
accounting. The excess cost over the fair market value of net assets acquired
and FCC licenses related to this acquisition are being amortized over a 40-year
period.
On March 1, 1999, the Company sold the FCC licenses and related
assets used in the operations of WSSP (FM) in Charleston, South Carolina for
approximately $1,600,000 in cash. The Company had previously issued a note for
$1,500,000 to a third party which was collateralized by the assets of the
station. Upon consummation of the sale, the note was repaid. The sale resulted
in a $100,000 gain to the Company.
On March 5, 1999, the Company entered into an agreement to sell
the FCC licenses and related assets used in the operations of radio stations
KAAA (AM) and KZZZ (FM) in Kingman, Arizona and KFLG (AM) and KFLG (FM) in
Bullhead City, Arizona for approximately $5,400,000 in cash to an unrelated
third party. The transaction is subject to FCC consent.
On March 30, 1999, the Company entered into an agreement to
sell the FCC licenses and related assets used in the operation of radio
stations KZGL (FM), KVNA (AM) and KVNA (FM) in Flagstaff, Arizona for
approximately $2,425,000 in cash to an unrelated third party. The transaction is
subject to FCC consent.
The results of operations of the acquired businesses are
included in the Company's financial statements since the respective dates of
acquisition.
The following unaudited pro forma data summarizes the combined
results of operations of the Company, Faircom, the June 15 Acquisitions and KOSS
(FM) as though the acquisitions had occurred at the beginning of the three month
period ended March 31, 1998. The Company's 1999 disposition of WSSP (FM) is
not material to the results of the Company for the three months ended March
31, 1998.
1998
----
Net broadcast revenues 4,110,333
Net loss (1,665,382)
Net loss per common share:
Basic and diluted (11.06)
These unaudited pro forma amounts do not purport to be
indicative of the results that might have occurred if the foregoing transactions
had been consummated on the indicated dates.
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On May 6, 1999, the Company purchased FCC licenses and related
assets used in the operations of radio stations WJON (AM), WWJO (FM) and KMXK
(FM) (the "St. Cloud Stations") in the St. Cloud, Minnesota market from WJON
Broadcasting Company for approximately $12,700,000 in cash. The purchase was
financed by approximately $5,082,000 in proceeds from the issuance of Series F
Convertible Preferred Stock (See Note 3) and borrowings under the Company's
senior reducing credit facility.
On May 11, 1999 the Company entered into an agreement to sell
the FCC licenses and related assets of KCBQ (AM) in San Diego, California for
approximately $6,000,000 in cash to an unrelated third party. The transaction
is subject to FCC consent.
3. CAPITAL STOCK
In January 1999, the Company issued 372,406 shares of Series G
Convertible Preferred Stock for $5.00 per share to certain executive officers of
the Company and Blue Chip Capital Fund II Limited Partnership, an existing
holder of Series C Convertible Preferred Stock. The proceeds were used to pay
down existing debt under the Credit Agreement and fund working capital needs of
the Company.
In February 1999, the Company issued 633,652 shares of Series F
Convertible Preferred Stock for $5.00 per share to existing Series F holders.
The proceeds were used to finance certain capital improvements, fund deferred
transaction costs related to the June 15 Acquisitions and the Faircom merger and
fund working capital needs of the Company.
In April 1999, the Company issued 1,016,348 shares of Series F
Convertible Preferred Stock at $5.00 per share to fund the purchase by the
Company of FCC licenses and other assets from WJON Broadcasting Company (See
Note 2).
In April 1999, the Company shareholders voted to increase the
number of authorized shares of common stock from 30,000,000 to 60,000,000 and
increase the number of authorized shares of preferred stock from 20,000,000 to
40,000,000.
4. EARNINGS PER SHARE
SFAS 128 calls for the dual presentation of basic and diluted
earnings per share ("EPS"). Basic EPS is based upon the weighted average common
shares outstanding during the period. Diluted EPS reflects the potential
dilution that would occur if common stock equivalents were exercised. The
effects of the assumed conversion of the Company's convertible preferred stock
and the assumed exercise of outstanding options and warrants would not be
dilutive for all periods presented. Therefore, basic EPS and diluted EPS are the
same for all periods presented.
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the
Condensed Consolidated Financial Statements. Results for the interim periods may
not be indicative of the results for the full years.
On June 15, 1998, Regent consummated a number of mergers, acquisitions,
borrowings and issuances of additional equity (the "June 1998 Transactions").
See Notes 1 and 2 to the Company's Condensed Consolidated Financial Statements
included as part of this Form 10-Q. The historical financial statements of
Faircom Inc. ("Faircom"), which was deemed the "accounting acquirer" in the
merger between Faircom and Regent completed June 15, 1998, became the historical
financial statements of the Company, and accordingly, the results of operations
of Regent and of the other entities which merged with or were acquired by Regent
as part of the June 1998 Transactions have been included in the Company's
Condensed Consolidated Financial Statements only from June 15, 1998.
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On the closing date of the June 1998 Transactions, the Company expanded
from being a small broadcaster (represented, from an accounting standpoint, by
Faircom's six stations in two markets) to a group broadcaster operating 33
stations in ten different markets. This significant change in size of the
Company's operations led directly to substantial increases in revenue, operating
expenses, depreciation and amortization, corporate general and administrative
expenses, and interest expense in 1999 as compared to 1998. Because of the June
1998 Transactions, the results of the Company's operations in 1999 are not
comparable to those of 1998, nor are they necessarily indicative of results in
the future.
The key focus from the consummation of the June 1998 Transactions into
the first quarter of 1999 was developing the platform from which the Company
could carry out its operating strategies as a much larger radio company.
Development of the platform required significant expenditures. These costs are
viewed by the Company as investment costs which will provide returns to the
Company in future years. Operationally, the Company replaced general managers in
eight of its markets and added or replaced general sales managers in six markets
in order to implement aggressive sales programs. The Company invested
significantly in the hiring and training of sales personnel and in increased
promotional spending in all markets. While many of these changes took place
prior to the first quarter of 1999, the operational improvements take some
time to manifest even though the cost increases were immediate. In addition,
the Company developed a corporate staff which it believes is capable of
supporting a much larger operation and now maintains primary executive and
administrative offices located in Covington, Kentucky, as well as the New York
corporate office utilized by Faircom at the time of its merger with the Company.
The cost of executive personnel and administrative expense amounted to
approximately $615,000 in the three months ended March 31, 1999, versus
approximately $114,000 in the comparable period in 1998. Consequently,
operating loss of $655,000 in the three months ended March 31, 1999
compared unfavorably with operating loss of $38,000 in the comparable
period for 1998.
Interest expense was $862,000 in the three months ended March 31, 1999
as compared with $504,000 in the comparable period for 1998 principally due to
debt incurred in connection with the June 1998 Transactions.
In addition to developing the infrastructure to support a large radio
group, the Company has decided to concentrate on markets which have a minimum of
approximately $8,000,000 in market advertising revenue and where the Regent
stations have the potential to generate at least $1,000,000 in annual broadcast
cash flow. The Company has entered into agreements to sell its Flagstaff and
Kingman/Bullhead City, Arizona radio stations (the "Arizona Stations"), which
do not meet this strategic objective. Applications for FCC approval of these
sales are pending.
LIQUIDITY AND CAPITAL RESOURCES
In three months ended March 31, 1999, net cash used in operating
activities was $1,259,000 compared with net cash provided by operating
activities of $401,000 for 1998. Approximately $1,200,000 of the cash used in
operating activities during the 1999 period was used to pay deferred
professional fees which were mostly incurred in connection with the June 1998
Transactions. In the three months ended March 31, 1999, proceeds from the
issuance of preferred stock provided substantially all of the funds used in
operating activities, as well as funds used for capital expenditures, principal
payments on long-term debt and other investing and financing activity cash
requirements. As a result, there was a net increase in cash of $2,006,000 in the
three months ended March 31, 1999 compared with a net decrease of $11,000 in the
same period in 1998.
The Company's borrowings are made under an agreement with a group of
lenders (as amended through the latest amendment dated February 24, 1999, the
"Credit Agreement") which provides for a senior reducing revolving credit
facility with a commitment of up to $55,000,000 expiring March 31, 2005 (the
"Revolver"). The Credit Agreement permits the borrowing of available credit for
working capital and acquisitions, including related acquisition expenses. In
addition, the Company may request from time to time that the lenders issue
letters of credit in accordance with the same provisions as the Revolver. At
March 31, 1999, the Company had borrowed $33,985,000 under the Credit Agreement
and had approximately $2,485,000 in cash balances. The remaining unused portion
of the Revolver of $21,015,000 was available to finance other acquisitions,
subject to restrictions contained in the Credit Agreement.
Beginning January 1, 1999, the Company is required to maintain an
interest rate coverage ratio (EBITDA, defined as earnings before interest,
taxes, depreciation and amortization, to annual interest rate cost); a fixed
charge coverage ratio (EBITDA to annual fixed charges); and a financial leverage
ratio (total debt to Adjusted EBITDA, as defined in the Credit Agreement). To
maintain compliance with these covenants, the Company must reduce its
outstanding borrowings during the second and third quarters of 1999.
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It intends to do this through proceeds from the sales of the Arizona
Stations as well as the sale of the Company's operations in another non-
strategic market. The sale of four of the seven Arizona Stations is expected to
close during the second quarter of 1999, pending receipt of FCC consent. Sale of
the other three could be delayed into the third quarter, depending on the timing
of FCC consent. The Company is currently seeking a buyer for its other
non-strategic market and expects to be able to consummate that sale during the
third quarter of 1999. If these sales were to be delayed, the Company will
request waivers from its lenders to allow more time for the sales to close or to
raise additional equity to reduce its debt.
Interest under the Credit Agreement is payable, at the option of the
Company, at alternative rates equal to the LIBOR rate (established March 3, 1999
at 5.06% and effective at that same rate at March 31, 1999) plus 1.50% to 3.50%,
or the base rate announced by the Bank of Montreal (7.75% at March 31, 1999)
plus .25% to 2.25%. The spreads over the LIBOR rate and such base rate vary from
time to time, depending upon the Company's financial leverage. The Company will
pay quarterly commitment fees equal to 3/8% to 1/2% per annum, depending upon
the Company's financial leverage, on the unused portion of the commitment under
the Credit Agreement. The Company also is required to pay certain other fees to
the agent and the lenders for the administration and use of the credit facility.
In the first quarter of 1999, the Company received approximately
$5,030,000 in gross proceeds from the issuance of shares of its Series F and G
Convertible Preferred Stock at $5.00 per share. In the second quarter of 1999,
the holders of the Series F Convertible Preferred Stock purchased an additional
1,016,348 shares of the Company's Series F Convertible Preferred Stock at $5.00
per share, to finance the acquisition of the St. Cloud Stations. In May 1999,
the Company borrowed $8,500,000 in funds under the Credit Agreement to finance
the balance of the purchase price of the St. Cloud Stations and related
transaction fees. In addition, in May of 1999 three existing shareholders have
expressed a willingness to purchase an additional $10,000,000 of a new series of
convertible preferred stock ("Series H Convertible Preferred Stock"), with terms
substantially the same as the Company's outstanding Series G Convertible
Preferred Stock, at $5.50 per share. It is anticipated that approximately
$2,500,000 of that amount will be funded in the second quarter of 1999 and will
be used to reduce bank debt and fund working capital requirements. The remaining
amount would be generally available to finance future acquisitions.
Based on current interest rates and accrued interest expense as of
March 31, 1999, the Company believes its interest payments for the remainder of
1999 will be approximately $2,400,000. Scheduled debt principal payments are
expected to be $49,000 for the remainder of 1999. Corporate general and
administrative expense and capital expenditures for the remainder of 1999 are
estimated to be approximately $1,500,000 and $1,200,000, respectively. Most of
the planned capital expenditures are required to be made in 1999 under the terms
of the Credit Agreement. During the first quarter of 1999, the Company paid
approximately $1,200,000 of deferred professional fees which were mostly
incurred in connection with the June 1998 Transactions. The Company has paid an
additional $171,000 in the second quarter of 1999 and intends to pay the
remaining balance of approximately $115,000 in 1999. For these payments to be
made over the balance of 1999, aggregating $5,435,000, the Company has used or
will utilize net cash provided by operations, current cash balances, proceeds
from the issuance of Series F and G Convertible Preferred Stock received in the
first quarter of 1999 and the $2,500,000 of proceeds from the Series H
Convertible Preferred Stock expected in the second quarter of 1999.
The Company believes net cash from operations; cash balances; the
proceeds from the sales of the Arizona Stations and the Company's other
non-strategic property; and $2,500,000 of the proceeds from the contemplated
issuance of the Series H Convertible Preferred Stock will be sufficient to
reduce borrowings under the Credit Agreement to allow the Company to maintain
compliance with all covenants and to meet the Company's interest expense and
any required principal payments, corporate expenses and capital expenditures
in the foreseeable future, based on its projected operations and indebtedness.
The Company is actively pursuing a number of acquisitions of radio
stations in a number of markets. Any such acquisitions would be financed from
borrowings against the unused portion of the Credit Agreement (less any
utilization of such portion for working capital needs), proceeds from the
issuance of Series H Convertible Preferred Stock, and through additional equity
or high yield debt offerings. There can be no assurance, however, that any of
such acquisitions will be consummated or that all or any portion of such
financing will be available.
MARKET RISK
The Company is exposed to the impact of interest rate changes because
of borrowings under its Credit Agreement. It is the Company's policy to enter
into interest rate transactions only to the extent considered necessary to meet
its objectives and to comply with the requirements of its Credit Agreement. The
Company has not entered into interest rate transactions for trading purposes.
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To satisfy the requirements of its Credit Agreement, the Company
entered into a two-year collar agreement with the Bank of Montreal effective
August 17, 1998 for a notional amount of $34,400,000 to mitigate the risk of
increasing interest rates created by the borrowing under its Credit Agreement.
This agreement is based on the three-month LIBOR rate, has a Cap Rate, as
defined, of 6.50% and a Floor Rate, as defined, of 5.28%. These rates are
exclusive of additional spreads over the LIBOR rate depending upon the Company's
financial leverage. Based on the $33,985,000 principal amount outstanding under
the Company's credit facility at March 31, 1999, the annual interest expense
would fluctuate by a maximum of $415,000.
YEAR 2000 COMPUTER SYSTEM COMPLIANCE
The "Year 2000" ("Y2K") issue results from the fact that many computer
programs were written with date-sensitive codes that utilize only the last two
digits (rather than all four digits) to refer to a particular year. As the year
2000 approaches, these computer programs may be unable to process accurately
certain date-based information, as the program may interpret the year 2000 as
1900.
The Company utilizes various information technology (IT) systems in the
operation of its business, including accounting and financial reporting systems
and local and wide area networking infrastructure. In addition to IT systems,
the Company is also reliant on several non-information technology (non-IT)
systems, which could potentially pose Y2K issues, including traffic scheduling
and billing systems and digital audio systems providing automated broadcasting.
Finally, in addition to the risks posed by Y2K issues involving its own IT and
non-IT systems, the Company could also be affected by any Y2K problems
experienced by its key business partners, which include local and national
advertisers, suppliers of communications services, financial institutions and
suppliers of utilities. The Company's plans to address the Y2K issue involve
four phases: (a) assessment of the existence, nature and risk of Y2K problems
affecting the Company's systems; (b) remediation of the Company's systems,
whether through repair, replacement or upgrade, based on the findings of the
assessment phase; (c) testing of the enhanced or upgraded systems; and (d)
contingency planning.
In the fourth quarter of 1998, the Company engaged the services of an
independent Y2K consultant in order to analyze the scope of the Company's Y2K
compliance issues and to initiate formal communications with its advertisers,
suppliers, lenders and other key business partners to determine their exposure
to the Y2K issue.
During the first quarter of 1999, the assessment phase was completed
with respect to the IT-systems and non-IT systems. Based on the findings of the
assessment phase, a detailed plan was developed for the remaining phases
(remediation, testing and contingency planning).
A summary of the status of the Company's Y2K plans in the IT and non-IT
areas follows.
IT Systems
During the assessment phase, the Company evaluated the level of Y2K
compliance of IT systems and hardware in its executive offices and all
markets. All financial and networking systems which have been
determined to be non-compliant will be upgraded in the second quarter
of 1999 and tested by the end of the third quarter of 1999. Costs
associated with the upgrades are expected to be immaterial. The Company
has assessed several of its personal computers ("PCs") to be
non-compliant. Several of the non-compliant PCs are either upgradable
at a minimal cost or are used for tasks where non-compliance will not
impact their functionality. There are PCs which will need to be
replaced in 1999 and the cost of replacement is included in the
Company's capital plan. All necessary upgrades will occur by the end of
the third quarter of 1999. Most of the replacements will take place by
the end of the third quarter; however, a portion will occur in the
fourth quarter.
Non-IT Systems
The Company acquired all but one of its radio stations on or after June
15, 1998 from several independent operators. As part of the Company's
ongoing plan to provide its stations with a standardized digital audio
broadcast system and, thus, to realize certain of the efficiencies of
operating as a larger broadcast group, the Company has been
systematically upgrading the broadcast systems and other technical
equipment at its stations. Although this upgrading plan has had a
business purpose independent of the Y2K compliance issue, the Company
has required, as a matter of course, written assurance from its
suppliers that the new broadcast systems are Y2K compliant. With
respect to those properties which the Company expects to own on January
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1, 2000, the upgrading project is 70% complete, with the installation
of new Y2K compliant broadcast systems having been completed for the
Company's stations in all of its markets except the Chico, California,
Mansfield, Ohio and Redding, California markets. The costs of the
upgrade project have been included in capital expenditures. Upgrades in
the Chico, California and the Mansfield, Ohio markets commenced during
the first quarter of 1999 and are expected to be completed by the end
of the second quarter of 1999. The upgrade in Redding will occur in the
third quarter in conjunction with an expansion of the Company's
facility in the market. The Company plans to conduct and complete its
own testing of the broadcast systems at all of its stations by the end
of the third quarter of 1999. The cost associated with this testing is
expected to be immaterial.
The traffic scheduling and billing systems currently utilized at the
Company's stations are provided by two suppliers on a Y2K compliant
basis, with the exception of the Company's stations located in the
Victorville, California market. To confirm Y2K compliance of its
traffic and billing systems, the Company intends to conduct and
complete tests of these systems during the second quarter of 1999. By
the third quarter of 1999, the Company intends to have replaced its
traffic and billing systems at the Victorville stations with a system
provided by suppliers utilized by the Company's other stations.
During the first quarter of 1999, the Company compiled a detailed
inventory of key business partners and prioritized the list based on potential
impact to the Company in the event that the business partners experienced severe
operational or financial hardship as a result of Y2K non-compliance. Each
business partner was contacted and asked to fill out a detailed questionnaire
regarding its own Y2K assessment. Follow-up on responses will occur in the
second quarter of 1999 and action steps will be developed based on the
responses.
The Company has budgeted $100,000 in 1999 for capital expenditures and
$50,000 for expenses involved in Y2K remediation. The Company does not expect
total expenditures to exceed the total budgeted amount.
Although the Company has not received any information to date that
would lead it to believe its internal Y2K compliance issues will not be able to
be resolved on a timely basis or that the related costs will have a material
adverse effect on the Company's operations, cash flows or financial condition,
the assessment phase of the Company's plans relative to its business partner
interfaces will continue through the second quarter of 1999. The remediation
phase is also not complete with respect to the broadcast systems at the
Company's Chico, Redding and Mansfield stations, and no actual testing of the
Company's enhanced or upgraded systems has been conducted. Accordingly,
unexpected costs associated with the remediation of the Company's systems or
with interruption of operation of the Company's stations could occur and, if
significant, could have a material adverse effect on the Company's operations,
cash flows and financial condition. The most reasonably likely worst-case
scenarios include loss of power and communications links. The impact of these
uncertainties on the Company's results of operations, liquidity and financial
condition, is not determinable. Based on the assessment of external and non-IT
system risks and the testing to be undertaken by the Company, contingency plans
will be developed for all critical systems by the end of the third quarter of
1999. Testing of contingency plans will occur in the third and fourth quarters
of 1999.
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
This Form 10-Q includes certain forward-looking statements with respect
to the Company that involve risks and uncertainties. Such statements are
influenced by the Company's financial position, business strategy, budgets,
projected costs, and plans and objectives of management for future operations,
and are expressed with words such as "anticipate," "believe," "plan,"
"estimate," "expect," "intend," "project" and other similar expressions.
Although the Company believes its expectations reflected in such forward-looking
statements are based on reasonable assumptions, readers are cautioned that no
assurance can be given that such expectations will prove correct and that actual
results and developments may differ materially from those conveyed in such
forward-looking statements. For these statements, the Company claims the
protections of the safe harbor for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995.
Important factors that could cause actual results to differ materially
from the expectations reflected in the forward-looking statements herein include
changes in general economic, business and market conditions, as well as changes
in such conditions that may affect the radio broadcast industry or the markets
in which the Company operates, including, in particular, increased competition
for attractive radio properties and advertising dollars, fluctuations in the
cost of operating radio properties, and changes in the regulatory climate
affecting radio broadcast companies.
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Such forward-looking statements speak only as of the date on which they are
made, and the Company undertakes no obligation to update any forward-looking
statement to reflect events or circumstances after the date of this Form 10-Q.
If the Company does update or correct one or more forward-looking statements,
readers should not conclude that the Company will make additional updates or
corrections with respect thereto or with respect to other forward-looking
statements.
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
The information required by this Item 3 is presented above under Item
2. Management's Discussion and Analysis of Financial Condition and Results of
Operations, and is incorporated herein by this reference.
PART II - OTHER INFORMATION
ITEM 2. Changes in Securities and Use of Proceeds
(c) During the first quarter of 1999, the Company issued additional
shares of its preferred stock as follows:
On January 5, 1999, the Company issued 372,406 shares of its Series G
Convertible Preferred Stock for a cash purchase price of $5.00 per share to
certain executive officers of the Company and Blue Chip Capital Fund II Limited
Partnership, an existing holder of the Company's Series C Convertible Preferred
Stock. The proceeds were used to pay down existing debt under the Credit
Agreement and to fund working capital needs of the Company.
On February 23, 1999, the Company issued 633,652 shares of its Series F
Convertible Preferred Stock for a cash purchase price of $5.00 per share to
existing Series F holders. The proceeds were used to finance certain capital
improvements, fund deferred transaction costs related to the June 1998
Transactions and to fund working capital needs of the Company.
These issuances of securities were privately-negotiated transactions
based upon exemptions from registration under the Securities Act of 1933, as
amended (the "1933 Act"), claimed pursuant to Section 4(2) of the 1933 Act and
the rules and regulations promulgated thereunder.
Both the Series G Convertible Preferred Stock and the Series F
Convertible Preferred Stock are convertible into shares of the Company's common
stock on a one-for-one basis at any time at the option of the holder and under
certain circumstances at the option of the Company.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
The following is filed herewith as an exhibit to Part I of
this Form 10-Q:
Exhibit No. 27 Financial Data Schedule
The exhibits identified as Part II Exhibits in the following
Exhibit Index, which is incorporated herein by this reference, are filed or
incorporated by reference as exhibits to Part II of this Form 10-Q.
(b) Reports of Form 8-K
On March 30, 1999, the Company filed an Amendment No. 2 to its
Form 8-K initially filed June 30, 1998 and amended on September 30, 1998. The
Amendment No. 2 reported under Item 4 a change in the accounting firm for
Faircom's financial statements effective June 15, 1998, the date of the merger
between Faircom and the Company.
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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 hereunto duly authorized.
REGENT COMMUNICATIONS, INC.
Date: May 17, 1999 By: /s/ TERRY S. JACOBS
---------------------------------------
Terry S. Jacobs, Chairman of the Board
and Chief Executive Officer
Date: May 17, 1999 By: /s/ ANTHONY A. VASCONCELLOS
---------------------------------------
Anthony A. Vasconcellos,
Chief Financial Officer and
Vice President
(Chief Accounting Officer)
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15
EXHIBIT INDEX
The following exhibits are filed, or incorporated by reference where
indicated, as part of Part II of this Quarterly Report on Form 10-Q:
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
2(a)* Asset Purchase Agreement dated January 5, 1999 by and among
WJON Broadcasting Company, Regent Broadcasting of St. Cloud,
Inc., Regent Licensee of St. Cloud, Inc. and Regent
Communications, Inc. (previously filed as Exhibit 2(a) to the
Registrant's Form 10-K for the year ended December 31, 1998
and incorporated herein by this reference)
The following exhibits and schedules to the foregoing Asset
Purchase Agreement are omitted as not material; however,
copies will be provided to the Securities and Exchange
Commission upon request:
Schedules:
1.2 Miscellaneous Excluded Assets
3.4 Allocation of Purchase Price
6.4 Third Party Consents
7.4 Stations Licenses, Etc.
7.7 Tangible Personal Property
7.8 Real Property
7.9 Contracts (including identification of Material
Contracts)
7.11 Environmental Matters
7.12 Intellectual Property
7.13 Financial Statements
7.14 Personnel Information
7.15 Litigation
7.16 Compliance With Laws
7.17 Employee Benefit Plans
Exhibits:
A Form of Indemnification Escrow Agreement
B Form of Deposit Escrow Agreement
C Form of Assignment and Assumption Agreement
D Form of Non-Competition Agreement
E Form of Lease Agreement
F Form of FCC Counsel Opinion
G Form of Buyers' Counsel Opinion
H Form of Seller's Counsel Opinion
2(b)* Asset Purchase Agreement dated March 4, 1999 by and among Mag
Mile Media, L.L.C., Regent Broadcasting of Kingman, Inc. and
Regent Licensee of Kingman, Inc. (previously filed as Exhibit
2(b) to the Registrant's Form 10-K for the year ended
December 31, 1998 and incorporated herein by this reference)
The following exhibits and schedules to the foregoing Asset
Purchase Agreement are omitted as not material; however,
copies will be provided to the Securities and Exchange
Commission upon request:
Schedules:
A Licenses
B Contracts
C Tangible Property
C-1 Leased Personal Property
D Copyrights, Logos, Jingles, Service Marks,
Trademarks and Other Intangible Rights
E Real Property
F Allocation of Purchase Price
G Evidence of Sources of Funds
H Excluded Employees
Exhibits:
A Form of Deposit Escrow Agreement
B Form of Time Brokerage Agreement
C Form of Assignment and Assumption Agreement
D Form of Opinion - Sellers' Counsel
E Form of Opinion - Sellers' Commission Counsel
F Form of Opinion - Buyer's Counsel
2(c)* Asset Purchase Agreement dated March 30, 1999 by and among The
Guyann Corporation, Regent Broadcasting of Flagstaff, Inc. and
Regent Licensee of Flagstaff, Inc. (previously filed as
Exhibit 2(c) to the Registrant's Form 10-K for the year ended
December 31, 1998 and incorporated herein by this reference)
The following exhibits and schedules to the foregoing Asset
Purchase Agreement are omitted as not material; however,
copies will be provided to the Securities and Exchange
Commission upon request:
Schedules:
1.2.9 Miscellaneous Excluded Assets
6.3 Buyer Qualifications
7.4 Stations Licenses, Etc.
7.7 Tangible Personal Property
7.8 Leased Real Estate
7.9 Contracts (including identification of
Material Contracts)
7.11 Environmental Matters
7.12 Intellectual Property
7.13 Financial Statements
7.14 Employees
7.17 Employee Benefit Plans
Exhibits:
A Form of Indemnity Escrow Agreement
B Form of Deposit Escrow Agreement
C Form of Allocation of Purchase Price
D Form of Agreement Not to Compete
E Form of General Conveyance, Bill of Sale,
Assignment and Assumption Agreement
F Form of Seller's Counsel Opinion
G Form of Seller's FCC Counsel Opinion
H Form of Buyer's Counsel Opinion
2(d) Agreement of Purchase and Sale of Assets dated as of January
15, 1999 among Concord Media Group, Inc., Regent Broadcasting
of South Carolina, Inc. and Regent Licensee of South Carolina,
Inc.
The following schedules and exhibits to the foregoing
Agreement of Purchase and Sale of Assets are omitted as not
material; however, copies will be provided to the Securities
and Exchange Commission upon request:
Schedule 1.2 Excluded Property
Schedule 1.4 Permitted Liens
Schedule 4.2(b) Leases, Contracts
Schedule 5.3(b) Capital Stock of Seller
Schedule 5.4 Conflicts or Consents
Schedule 5.6 Exceptions to Title or Condition
Schedule 5.7 Litigation
Schedule 5.8(a) Compliance with Laws
Schedule 5.8(b) Commission Authorizations
Schedule 5.9 Property, Contracts and Leases
Schedule 5.10 Certain Changes and Events
Schedule 5.11 Environmental Matters
Schedule 5.12 Undisclosed Liabilities
Schedule A Form of Deposit Escrow Agreement
Exhibit 2.5 Form of Liabilities Undertaking
Exhibit 4.5(e)(i) Form of Opinion of Seller's Counsel
Exhibit 4.5(e)(ii) Form of Opinion of Seller's
Communications Counsel
3(a)* Amended and Restated Certificate of Incorporation of Regent
Communications, Inc., as amended by a Certificate of
Designation, Number, Powers, Preferences and Relative,
Participating, Optional and Other Special Rights and the
Qualifications, Limitations, Restrictions, and Other
Distinguishing Characteristics of Series G Preferred Stock of
Regent Communications, Inc., filed January 21, 1999.
(previously filed as Exhibit 3(a) to the Registrant's Form
10-K for the year ended December 31, 1998 and incorporated
herein by this reference)
3(b)* Amended and Restated By-Laws of Regent Communications, Inc.
(previously filed as Exhibit 3(b) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998 and
incorporated herein by this reference).
4(a)* Second Amended and Restated Stockholders' Agreement dated as
of June 15, 1998 among Regent Communications, Inc., Terry S.
Jacobs, William L. Stakelin, Waller-Sutton Media Partners,
L.P., William H. Ingram, WGP Corporate Development Associates
V, L.L.C., WGP Corporate Development Associates (Overseas) V,
L.P., River Cities Capital Fund Limited Partnership, BMO
Financial, Inc., General Electric Capital Corporation, Joel M.
Fairman, Miami Valley Venture Fund II Limited Partnership, and
Blue Chip Capital Fund II Limited Partnership (excluding
exhibits not deemed material or filed separately in executed
form) (previously filed as Exhibit 4(c) to the Registrant's
Form 8-K filed June 30, 1998 and incorporated herein by this
reference).
4(b)* Stock Purchase Agreement dated June 15, 1998 among Regent
Communications, Inc., Waller-Sutton Media Partners, L.P., WPG
Corporate Development Associates V, L.C.C., WPG Corporate
Development Associates (Overseas) V, L.P., General Electric
Capital Corporation, River Cites Capital Fund Limited
Partnership and William H. Ingram (excluding exhibits not
deemed material or filed separately in executed form)
(previously filed as Exhibit 4(d) to the Registrant's Form 8-K
filed June 30, 1998 and incorporated herein by this
reference).
4(c)* Registration Rights Agreement dated June 15, 1998 among Regent
Communications, Inc., PNC Bank, N.A., Trustee, Waller-Sutton
Media Partners, L.P., WPG Corporate Development Associates V,
L.C.C., WPG Corporate Development Associates (Overseas) V,
L.P., BMO Financial, Inc., General Electric Capital
Corporation, River Cites Capital Fund Limited Partnership,
Terry S. Jacobs, William L. Stakelin, William H. Ingram, Blue
Chip Capital Fund II Limited Partnership, Miami Valley Venture
Fund L.P. and Thomas Gammon (excluding exhibits not deemed
material or filed separately in executed form) (previously
filed as Exhibit 4(e) to the Registrant's Form 8-K filed June
30, 1998 and incorporated herein by this reference).
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4(d)* Warrant for the Purchase of 650,000 Shares of Common Stock
issued by Regent Communications, Inc. to Waller-Sutton Media
Partners, L.P. dated June 15, 1998 (See Note 1 below)
(previously filed as Exhibit 4(f) to the Registrant's Form 8-K
filed June 30, 1998 and incorporated herein by this
reference).
4(e)* Warrant for the Purchase of 50,000 Shares of Common Stock
issued by Regent Communications, Inc. to General Electric
Capital Corporation dated June 15, 1998 (previously filed as
Exhibit 4(g) to the Registrant's Form 8-K filed June 30, 1998
and incorporated herein by this reference).
4(f)* Agreement to Issue Warrant dated as of June 15, 1998 between
Regent Communications, Inc. and General Electric Capital
Corporation (excluding exhibits not deemed material or filed
separately in executed form) (previously filed as Exhibit 4(h)
to the Registrant's Form 8-K filed June 30, 1998 and
incorporated herein by this reference).
4(g)* Warrant for the Purchase of 80,000 Shares of Common Stock
issued by Regent Communications, Inc. to River Cities Capital
Fund Limited Partnership dated June 15, 1998 (previously filed
as Exhibit 4(k) to the Form 10-Q for the Quarter Ended June
30, 1998, as amended, and incorporated herein by this
reference).
4(h)* Stock Purchase Agreement dated as of May 20, 1997 between
Terry S. Jacobs and Regent Communications, Inc. (previously
filed as Exhibit 4(b) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998 and
incorporated herein by this reference).
4(i)* Stock Purchase Agreement dated as of May 20, 1997 between
River Cities Capital Fund Limited Partnership and Regent
Communications, Inc. (previously filed as Exhibit 4(c) to the
Registrant's Form S-4 Registration Statement No. 333-46435
effective May 7, 1998 and incorporated herein by this
reference).
4(j)* Stock Purchase Agreement dated as of November 26, 1997 and
Terry S. Jacobs and Regent Communications, Inc. (previously
filed as Exhibit 4(d) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998 and
incorporated herein by this reference).
4(k)* Stock Purchase Agreement dated as of December 1, 1997 between
William L. Stakelin and Regent Communications, Inc.
(previously filed as Exhibit 4(e) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998 and
incorporated herein by this reference).
4(l)* Stock Purchase Agreement dated as of December 8, 1997 between
Regent Communications, Inc. and General Electric Capital
Corporation (previously filed
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17
as Exhibit 4(f) to the Registrant's Form S-4 Registration
Statement No. 333-46435 effective May 7, 1998 and incorporated
herein by this reference).
4(m)* Stock Purchase Agreement dated as of December 8, 1997 between
Regent Communications, Inc. and BMO Financial, Inc.
(previously filed as Exhibit 4(g) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998 and
incorporated herein by this reference).
4(n)* Credit Agreement dated as of November 14, 1997 among Regent
Communications, Inc., the lenders listed therein, as Lenders,
General Electric Capital Corporation, as Documentation Agent
and Bank of Montreal, Chicago Branch, as Agent (excluding
exhibits not deemed material or filed separately in executed
form) (previously filed as Exhibit 4(j) to the Registrant's
Form S-4 Registration Statement No. 333-46435 effective May 7,
1998 and incorporated herein by this reference).
4(o)* Revolving Note issued by Regent Communications, Inc. to Bank
of Montreal, Chicago Branch dated November 14, 1997 in the
principal amount of $20,000,000 (See Note 2 below) (previously
filed as Exhibit 4(k) to the Registrant's Form S-4
Registration Statement No. 333-46435 effective May 7, 1998 and
incorporated herein by this reference).
4(p)* Agreement to Issue Warrant dated as of March 25, 1998 between
Regent Communications, Inc. and River Cities Capital Fund
Limited Partnership (previously filed as Exhibit 4(1) to the
Registrant's Form S-4 Registration Statement No. 333-46435
effective May 7, 1998 and incorporated herein by this
reference).
4(q)* First Amendment to Credit Agreement dated as of February 16,
1998 among Regent Communications, Inc., the financial
institutions listed therein, as lenders, General Electric
Capital Corporation, as Documentation Agent, and Bank of
Montreal, Chicago Branch as Agent (previously filed as Exhibit
4(w) to the Registrant's Form 8-K/A (date of report June 15,
1998) filed September 3, 1998 and incorporated herein by
reference).
4(r)* Second Amendment and Limited Waiver to Credit Agreement dated
as of June 10, 1998 among Regent Communications, Inc., the
financial institutions listed therein, as lenders, General
Electric Capital corporation, as Documentation Agent, and Bank
of Montreal, Chicago Branch, as Agent (previously filed as
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18
Exhibit 4(x) to the Registrant's Form 8-K/A (date of report
June 15, 1998) filed September 3, 1998 and incorporated herein
by reference).
4(s)* Third Amendment to Credit Agreement dated as of August 14,
1998 among Regent Communications, Inc., the financial
institutions listed therein, as lenders, General Electric
Capital Corporation, as Documentation Agent, and Bank of
Montreal, Chicago Branch, as Agent (previously filed as
Exhibit 4(y) to the Registrant's Form 10-Q for the Quarter
Ended September 30, 1998, as amended, and incorporated herein
by this reference).
4(t)* Amendment to Second Amended and Restated Stockholders'
Agreement, dated as of January 11, 1999, among Regent
Communications, Inc., Terry S. Jacobs, William L. Stakelin,
Waller-Sutton Media Partners, L.P., William H. Ingram, WGP
Corporate Development Associates V, L.L.C., WGP Corporate
Development Associates (Overseas) V, L.P., River Cities
Capital Fund Limited Partnership, BMO Financial, Inc., General
Electric Capital Corporation, Joel M. Fairman, Miami Valley
Venture Fund II Limited Partnership, and Blue Chip Capital
Fund II Limited Partnership (excluding exhibits not deemed
material or filed separately in executed form) (previously
filed as Exhibit 4(t) to the Registrant's Form 10-K for the
year ended December 31, 1998 and incorporated herein by
this reference)
4(u)* Stock Purchase Agreement dated January 11, 1999 between Regent
Communications, Inc. and Blue Chip Capital II Limited
Partnership relating to the purchase of 315,887 shares of
Regent Communications, Inc. Series G Convertible Preferred
Stock (excluding exhibits not deemed material or filed
separately in executed form) (previously filed as Exhibit
4(u) to the Registrant's Form 10-K for the year ended
December 31, 1998 and incorporated herein by this reference)
4(v)* Stock Purchase Agreement dated January 11, 1999 between
Regent Communications, Inc. and Terry S. Jacobs relating to
the purchase of 50,000 shares of Regent Communications, Inc.
Series G Convertible Preferred Stock (See Note 3) (excluding
exhibits not deemed material or filed separately in executed
form) (previously filed as Exhibit 4(v) to the Registrant's
Form 10-K for the year ended December 31, 1998 and
incorporated herein by this reference)
4(w)* Fourth Amendment, Limited Consent and Limited Waiver to Credit
Agreement, First Amendment to Subsidiary Guaranty and First
Amendment to Pledge and Security Agreement, dated as of
October 16, 1998 among Regent Communications, Inc., the
financial institutions listed therein, as lenders, General
Electric Capital Corporation, as Documentation Agent, and Bank
of Montreal, Chicago Branch, as Agent. (previously filed as
Exhibit 4(w) to the Registrant's Form 10-K for the year
ended December 31, 1998 and incorporated herein by this
reference)
4(x)* Fifth Amendment to Credit Agreement, dated as of November 23,
1998, among Regent Communications, Inc., the financial
institutions listed therein, as lenders, General Electric
Capital Corporation, as Documentation Agent, and Bank of
Montreal, Chicago Branch, as Agent. (previously filed as
Exhibit 4(x) to the Registrant's Form 10-K for the year
ended December 31, 1998 and incorporated herein by this
reference)
4(y)* Sixth Amendment and Limited Consent to Credit Agreement, dated
as of February 24, 1999, among Regent Communications, Inc.,
the financial institutions listed therein, as lenders, General
Electric Capital Corporation, as Documentation Agent, and Bank
of Montreal, Chicago Branch, as Agent. (previously filed as
Exhibit 4(y) to the Registrant's Form 10-K for the year
ended December 31, 1998 and incorporated herein by this
reference)
The following exhibit is filed as part of Part I of this Quarterly Report on
Form 10-Q:
27 Financial Data Schedule
- --------------------------------------------------------------------------------
* Incorporated by reference.
1. Six substantially identical Warrants for the purchase of shares of
Registrant's common stock were issued as follows:
Waller-Sutton Media Partners, L.P. 650,000
WPG Corporate Development Associates V, L.P. 112,580
WPG Corporate Development Associates (Overseas) V, L.P. 17,420
General Electric Capital Corporation 50,000
River Cities Capital Fund Limited Partnership 20,000
William H. Ingram 10,000
2. Two substantially identical notes were issued to Bank of Montreal, Chicago
Branch, in the principal amounts of $15,000,000 and $20,000,000.
3. Two substantially identical Stock Purchase Agreements were entered into for
the purchase of Series G Convertible Preferred Stock as follows:
Joel M. Fairman 3,319 shares
William L. Stakelin 3,200 shares
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