U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended August 31, 1997
--------------------------------------------------
[ ] TRANSITION REPORT UNDER SECTION 13 OF 15(d) OF THE EXCHANGE ACT
For the transition period from to
-------------------- ----------------------------
Commission File Number 000-21623
OBIE MEDIA CORPORATION
-----------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
OREGON 93-0966515
- ------------------------------- -------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
4211 West 11th Ave., Eugene, Oregon 97402
-----------------------------------------
(Address of principal executive offices)
541-686-8400 FAX 541-345-4339
- --------------------------------------------------------------------------------
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or 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 [x]. No [ ].
As of September 30, 1997, 3,505,000 shares of the issuer's common stock
were outstanding.
This report contains 8 pages. There are three exhibits.
<PAGE>
OBIE MEDIA CORPORATION
Consolidated Balance Sheets
ASSETS
August 31, November 30,
1997 1996
Current assets: (Unaudited)
Cash $ 44,882 $ 474,940
Accounts receivable, net 2,371,037 1,550,193
Deferred tax assets 313,438 709,000
Other current assets 772,122 812,450
------------- -------------
Total current assets 3,501,479 3,546,583
Property and equipment, net 9,134,574 8,458,014
Deferred tax assets 380,000 380,000
Other assets 219,477 147,987
------------- -------------
Total assets $ 13,235,530 $ 12,532,584
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Line of credit $ 885,457 $ -
Current portion of long-term debt 842,210 743,973
Accounts payable 350,711 757,020
Accrued expenses 1,064,680 1,070,440
Deferred revenue 692,660 595,302
------------- -------------
Total current liabilities 3,835,718 3,166,735
Long-term debt, less current portion 5,920,926 6,554,587
------------- -------------
Total liabilities 9,756,644 9,721,322
------------- -------------
Minority interest in subsidiary 39,203 27,407
------------- -------------
Shareholders' equity:
Preferred stock, without par value,
10,000,000 shares, authorized,
no shares issued and outstanding - -
Common stock, without par value;
20,000,000 shares authorized,
3,505,000 shares issued and
outstanding 6,176,575 6,161,992
Accumulated deficit (2,736,892) (3,378,137)
------------- -------------
Total shareholders' equity 3,469,683 2,783,855
------------- -------------
Total liabilities and
shareholders' equity $ 13,235,530 $ 12,532,584
============= =============
See accompanying notes
<PAGE>
<TABLE>
<CAPTION>
OBIE MEDIA CORPORATION
Consolidated Statements of Income
Three Months Ended Nine Months Ended
August 31, August 31, August 31, August 31,
1997 1996 1997 1996
-------------- --------------- -------------- --------------
Revenues: (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Outdoor advertising $ 1,378,664 $ 1,162,096 $ 3,928,437 $ 3,455,515
Transit advertising 2,663,737 1,597,800 5,896,053 4,104,060
Less agency commissions (365,983) (216,187) (840,489) (580,736)
-------------- --------------- -------------- --------------
Net revenues 3,676,418 2,543,709 8,984,001 6,978,839
Operating expenses:
Direct advertising expenses 2,265,809 1,501,604 5,333,420 4,144,062
General and administrative 563,330 305,434 1,512,282 957,245
Start up costs 76,390 -- 230,067 --
Depreciation and amortization 159,497 141,602 477,961 423,570
-------------- --------------- -------------- --------------
Operating income 611,392 595,069 1,430,271 1,453,962
Other income (11,000) 6,283 (51,492) (193,294)
Interest expense 134,370 399,480 424,970 1,109,942
Minority interest in subsidiary (725) (1,925) 11,949 20,591
-------------- --------------- -------------- --------------
Income before income taxes 488,747 191,231 1,044,844 516,723
Provision for income taxes (187,923) (13,297) (403,599) (23,897)
-------------- --------------- -------------- --------------
Net income $ 300,824 $ 177,934 $ 641,245 $ 492,826
============== =============== ============== ==============
Net earnings per share $ 0 .09 $ 0.07 $ 0.18 $ 0.20
Weighted average number of common
shares outstanding 3,502,880 2,500,000 3,503,698 2,500,000
============== =============== ============== ==============
</TABLE>
See accompanying notes
<PAGE>
<TABLE>
<CAPTION>
OBIE MEDIA CORPORATION
Consolidated Statements of Cash Flows
Three Months Ended Nine Months Ended
August 31, August 31, August 31, August 31,
1997 1996 1997 1996
------------- ------------ ------------ ------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Cash flows from operating activities:
Net income $ 300,824 $ 177,934 $ 641,245 $ 492,826
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization 159,497 141,602 477,961 423,570
Changes in operating assets
and liabilities (491,083) (165,811) (808,276) (427,872)
------------- ------------ ------------ ------------
Net cash provided by
operating activities (30,762) 153,725 310,930 488,524
------------- ------------ ------------ ------------
Cash flows from investing activities:
Capital expenditures (313,121) (198,621) (1,117,401) (785,684)
Proceeds from asset
dispositions -0- -0- -0- 235,700
------------- ------------ ------------ ------------
Net cash used in
investing activities (313,121) (198,621) (1,117,401) (549,984)
------------- ------------ ------------ ------------
Cash flows from financing activities:
Payments on long-term debt (198,544) (208,333) (535,423) (572,558)
Credit line borrowing 822,721 -0- 885,456 -0-
Other financing activities (235,412) 216,329 26,380 597,118
------------- ------------ ------------ ------------
Net cash provided by
financing activities 388,765 7,996 376,413 24,560
------------- ------------ ------------ ------------
Net increase (decrease) in cash 44,882 (36,900) (430,058) (36,900)
Cash , beginning of period -0- -0- 474,940 54,568
------------- ------------ ------------ ------------
Cash, end of period $ 44,882 $ (36,900) $ 44,882 $ 17,668
============= ============ ============ ============
</TABLE>
See accompanying notes
<PAGE>
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The interim financial statements have been prepared by Obie Media Corporation
(the "Company") without audit. In the opinion of management, the accompanying
unaudited financial statements contain all adjustments necessary to present
fairly the financial position of the Company as of August 31, 1997, and the
results of operations and cash flows of the Company for the three months and
nine months ended August 31, 1997 and August 31, 1996. The condensed
consolidated financial statements include the accounts of the Company and its
subsidiary, and all significant intercompany accounts and transactions have been
eliminated in consolidation.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted as permitted by rules and regulations of the
Securities and Exchange Commission. The organization and business of the
Company, accounting policies followed by the Company and other information are
contained in the notes to the Company's financial statements filed as part of
the Company's November 30, 1996 Form 10-KSB. This quarterly report should be
read in conjunction with such annual report.
2. Long-Term Borrowings
The Company's Term Loan Agreement contains certain covenants including
maintenance of cash flow coverage. The Company was in compliance with these
covenants as of August 31, 1997.
3. Income Per Share
Income per common share is computed on the weighted average number of common
shares outstanding during the period after consideration of the dilutive effect
of stock options.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
August 31, 1997 August 31, 1996 August 31, 1997 August 31, 1996
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Issued and outstanding shares 3,502,880 2,500,000 3,500,967 2,500,000
(weighted average)
Stock Options - - 2,731 -
--------------- --------------- --------------- ---------------
3,502,880 2,500,000 3,503,698 2,500,000
=============== =============== =============== ===============
</TABLE>
4. Newly Issued Financial Accounting Pronouncements
In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") NO. 128, "Earnings Per Share." This
standard revises the disclosure requirements of earnings per share, simplifies
the computation of earnings per share and increases the comparability of
earnings per share on an international basis. SFAS No. 128 will be effective for
the Company for the year ending November 30, 1998. The earnings per share under
the new standard do not differ from those calculated under the existing
standard.
<PAGE>
MANAGEMENT'S DISCUSSION & ANALYSIS
The following discussion of the financial condition and results of operations of
the Company should be read in conjunction with the consolidated financial
statements included elsewhere in this Form 10-QSB. The following discussion
contains certain forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ materially from the
forward-looking statements. Factors that could cause or contribute to such
differences include the following: a decline in the demand for advertising in
the areas where the Company conducts its business; a deterioration of business
conditions generally in such areas; slower than expected acceptance of the
Company's unique display products; competitive factors, including increased
competition and price pressures; changes in regulatory or other external
factors; and other factors listed from time to time in the Company's SEC
reports, including but not limited to, its "Risk Factors" discussion in the
Registration Statement it filed in connection with its initial public offering
(the "IPO").
Expansion Activities
- --------------------
The Company has signed four additional transit district contracts since April 1,
1997: Dallas, Texas (DART), and three contracts in and around Sacramento,
California, including Sacramento Rapid Transit (RT), Paratransit (PARA), and
Yolo County Transit Authority (YOLO). The DART system has approximately 800
vehicles, while the three districts in Sacramento have a combined total of 330
vehicles. The Company has, for the last two years, provided advertising services
in Sacramento for the 32 RT light rail vehicles only.
The Company's contract with RT started April 1, 1997. The contract is for three
years with two additional years at the unilateral discretion of RT. The contract
provides for RT to receive 51% of revenue from the sale of advertising on RT
vehicles subject to a guaranteed minimum. Under the contract, RT will receive a
minimum of $1.7 million over the five years. The PARA contract began April 1,
1997 and is for three years with two additional years at the unilateral
discretion of PARA. The contract provides for PARA to receive approximately 51%
of advertising revenues in each year with no guaranteed minimum payment. The
YOLO contract began June 1, 1997 and is for three years with two additional
years at the unilateral discretion of YOLO. The contract provides for YOLO to
receive 51% of advertising revenues in excess of $100,000 in each year with a
guaranteed minimum of $110,000 over the five years.
The Company's contract with DART began July 1, 1997. The contract is for four
years and nine months. The Company will pay DART approximately $13 million over
the term of the contract. After the Company was announced as the apparent high
bidder for the DART contract, the incumbent provider protested the anticipated
award to the Company. The incumbent's protests and appeals were denied. The
Company incurred start up costs as discussed below, both to participate in the
appeal process and to be ready to commence operations in Dallas once the appeal
process was complete.
Results of operations for the three months ended August 31, 1997
- ----------------------------------------------------------------
(all dollars in $000 except per share amounts)
Net revenues increased 44.5% from $2,544, for the three-month period ended
August 31, 1996, to $3,676 for the three-month period ended August 31, 1997
primarily due to the addition of the Dallas and Sacramento markets and higher
advertising rates and increased occupancy in existing operations. Gross transit
revenues increased approximately 66.2% from $1,598 in 1996, to $2,664 in 1997,
while gross outdoor advertising revenues increased 18.6% from $1,162 in 1996 to
$1,379 in 1997. Agency discounts increased 69.3% from $216 to $366 in the second
quarter of 1996 and 1997, respectively, reflecting an increase in advertising
agency business primarily in transit. Agency discounts as a percentage of gross
sales rose from 7.8% in the third quarter of 1996 to 9.0% in the same period in
1997 reflecting the more rapid growth of transit sales and the addition of the
Dallas and Sacramento markets.
<PAGE>
Direct advertising expenses increased 50.9% to $2,266 for the third quarter of
1997, from $1,502 in the comparable period in 1996, primarily due to increased
revenues.
General and administrative costs increased 84.4% to $563 in the third quarter of
1997 from $305 in the comparable period in 1996. Increased general and
administrative costs are primarily due to increased payroll and other costs of
the Company's growth and the costs of being a public company. In addition, in
the third quarter of 1996, the Company was part of a larger consolidated group
of companies, and, accordingly, a portion of the general and administrative
costs of the companies were paid by affiliates in the third quarter of 1996.
The direct costs of developing new markets was $76 in the three months ended
August 31, 1997. There were no comparable costs in the same period of 1996.
These costs primarily were incurred in obtaining the DART contract discussed
above. The Company's takeover in Dallas was expected to occur on April 1, 1997.
Administrative protests by the incumbent provider delayed the effective date of
the takeover until July 1, 1997 and caused the Company to incur significant
additional costs during the quarter to participate in the appeals process, and
to enable the Company to take over immediately once the appeal was resolved. The
Company will continue to incur costs to obtain and prepare to operate new
transit district contracts. However, the amount of these costs is expected to
decline in absolute terms and as a percentage of sales.
Interest expense decreased 66.4%, from $399 for the three months ended August
31, 1996, to $134 for the comparable period in 1997, primarily due to the
reduction in debt resulting from the IPO and from lower interest rates due to
refinancing the Company's primary long-term debt in the fourth quarter of 1996.
The Company's effective income tax rate for the third quarter of 1996 was lower
than in 1997 due to the utilization of net operating loss carryforwards in 1996.
For the above reasons, third quarter income before income tax increased from
$191 in 1996 to $489 in 1997. After tax income increased from $178 in 1996 to
$301 in 1997. Earnings per share for the quarter increased to 9(cent) in 1997
from 7(cent) in 1996. An increased number of shares was outstanding in 1997.
Results of operations for the nine months ended August 31, 1997
- ----------------------------------------------------------------
(all dollars in $000 except per share amounts)
Net revenues increased 28.7%, from $6,979 for the nine-month period ended August
31, 1996, to $8,984 for the nine-month period ended August 31, 1997 primarily
due to the addition of the Dallas and Sacramento markets and higher advertising
rates and increased occupancy in existing markets. Gross transit revenues
increased approximately 43.7%, from $4,104 in 1996 to $5,896 in 1997, while
gross outdoor advertising revenues increased 13.7%, from $3,456 in 1996 to
$3,928 in 1997. Agency discounts increased 44.7%, from $581 to $840 in the third
quarter of 1996 and 1997, respectively, reflecting an increase in advertising
agency business primarily in transit.
Agency discounts as a percentage of sales increased from 7.7% in the first nine
months of 1996 to 8.6% in 1997 due primarily to increased transit sales as a
percentage of total sales.
Direct advertising expenses increased 28.7% to $5,333 for the first nine months
of 1997, from $4,144 in the comparable period in 1996, primarily due to
increased revenues.
<PAGE>
General and administrative costs increased 58.0% to $1,512 in the first three
quarters of 1997 from $957 in the comparable period in 1996. Increased general
and administrative costs are primarily due to increased payroll and other costs
of the Company's growth , including the addition of the Dallas and Sacramento
markets, and the costs of being a public company. In addition, in the first
three quarters of 1996, the Company was part of a larger consolidated group of
companies, and, accordingly, a portion of the Company's general and
administrative costs of the companies were paid by affiliates in 1996.
The direct costs of developing new markets was $230 in the nine months ended
August 31, 1997. There were no comparable costs in the same period of 1996.
These costs primarily were incurred in obtaining the DART contract discussed
above. The Company will continue to incur costs to obtain and prepare to operate
new transit district contracts. However, the amount of these costs should
decline in absolute terms and as a percentage of sales.
Interest expense decreased 61.7%, from $1,110 for the nine months ended August
31, 1996, to $425 for the comparable period in 1997, primarily due to the
reduction in debt resulting from the IPO and from lower interest rates due to
refinancing the Company's primary long-term debt in the fourth quarter of 1996.
The Company's effective income tax rate for 1996 was lower than in 1997 due to
the utilization of net operating loss carryforwards in 1996.
For the above reasons, pretax income for the first three quarters of the year
increased to $1,045 in 1997 from $517 in 1996. After tax income increased from
$493 in 1996 to $641 in 1997. Earnings per share for the nine-month period
declined to 18(cent) in 1997 from 20(cent) in 1996, primarily due to the
increase in the number of shares outstanding.
Liquidity and Capital Resources
- -------------------------------
( All dollars in $000 except per share amounts)
The Company's working capital deficit was $334 at August 31, 1997. The decrease
in working capital resulted primarily from borrowings on the line of credit to
fund investing activities.
Net cash provided by (used in) operating activities was $311 for the first three
quarters of 1997 and $(31) for the third quarter of 1997 respectively.
The net cash used in investing activities was $1,117 for the first nine months
of 1997, and was $313 for the third quarter. Expenditures were primarily for the
construction of outdoor advertising displays but also included costs of
furniture and tenant improvements for the new office and production facility in
Eugene, Oregon.
The Company's net cash provided by financing activities was $376 for the nine
months ended August 31, 1997 and $389 for the third quarter, primarily due to
borrowings on the credit line.
At August 31, 1997, the Company had outstanding borrowings of approximately
$7,649 of which $6,763 were pursuant to long-term credit agreements. The Company
maintains a $2,000 operating line of credit. The line carries interest at the
Prime rate of the lender. As of August 31, 1997, there were $885 in borrowings
on this line of credit, and the Company's available borrowing capacity, based on
collateralized accounts, was an additional $847.
The Company believes that cash generated from operations and available
borrowings under its credit agreements will be sufficient to finance the
Company's operations, including anticipated capital expenditures, through fiscal
1997.
<PAGE>
Seasonality
- -----------
The Company's transit advertising revenues have exhibited some degree of
seasonality. Typically, the Company experiences its lowest revenues during the
first quarter of each year. The Company expects this trend to continue. A
reduction in revenues in any quarter is likely to result in a period-to-period
decline in operating performance and net income.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(1) Modification of U.S. Bank Loan Agreement
(2) Amendment of Lease Agreement with Obie Industries Incorporated
(27) Financial Data Schedule
(b) A report on Form 8-K was filed by the Company on September 24, 1997
reporting the change in the Company's auditors.
Signature
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Obie Media Corporation
Date October 10, 1997 By: /s/ James W. Callahan
------------------- ---------------------
James W. Callahan
Chief Financial Officer
Signing on behalf of the registrant and
as principal financial and accounting officer
THIRD AMENDMENT OF LOAN AGREEMENT
PARTIES:
OBIE MEDIA CORPORATION, an Oregon corporation (Borrower)
UNITED STATES NATIONAL BANK OF OREGON (Bank)
RECITALS:
On October 31, 1996, Borrower, Bank and certain Guarantors entered into
a Loan Agreement (the Original Loan Agreement). The Original Loan Agreement was
subsequently modified by First Amendment of Loan Agreement and a Second
Amendment of Loan Agreement (the Second Amendment). The Original Loan Agreement,
as modified, is referred to in this amendment as the Loan Agreement. Except as
specifically set forth in this amendment, all capitalized terms have the
meanings assigned in the Loan Agreement.
AGREEMENTS:
1. THE REVOLVING LOAN.
a. MAXIMUM AMOUNT. Subparagraph 3.a. of the Loan Agreement
is modified to read as follows:
"a. MAXIMUM AMOUNT. Subject to the terms and conditions
of this Agreement, Bank, at its option, may make Advances to
Borrower from time to time on a revolving credit basis in an
aggregate principal amount not to exceed at any one time
outstanding an amount equal to the lesser of (i) Two Million
Dollars ($2,000,000); and (ii) the Borrowing Base then in
effect."
b. THE REVOLVING NOTE. The first sentence of Paragraph 3.d. of
the Loan Agreement is modified to read as follows:
"d. ADVANCES. Advances under the Revolving Loan shall
be evidenced by a Revolving Note executed by Borrower in the
principal amount of Two Million Dollars ($2,000,000)."
<PAGE>
c. FEE. Contemporaneously with the execution of this
amendment, Borrower shall pay to Bank a fee of Two Thousand Five Hundred Dollars
($2,500).
2. CURRENT RATIO COVENANT. Borrower's covenant to maintain a ratio of
Current Assets to Current Liabilities of not less 1:1 as of the end of each
calendar quarter of Borrower is terminated, effective May 1, 1997.
3. ADDITIONAL DOCUMENTS. Contemporaneously with the execution of this
amendment, Borrower shall deliver to Bank, in form and substance satisfactory to
Bank, the following:
a. A Revolving Note.
b. A written opinion of Gleaves, Swearingen, Larsen, Potter,
Scott & Smith and/or Tonkon, Torp, Galen, Marmaduke & Booth, the counsel for
Borrower, dated as of the date of this amendment and addressed to Bank, in form
and substance satisfactory to Bank.
c. Any other documents that Bank may reasonably request.
4. REPRESENTATIONS AND WARRANTIES. To induce Bank to enter into this
amendment, Borrower represents and warrants to Bank that, except as previously
disclosed to Bank:
a. All representations and warranties of Borrower contained in
the Loan Agreement continue to be true and complete as of the date of this
amendment.
b. No Event of Default has occurred or is continuing, and no
event has occurred and is continuing that, with the giving of notice or the
passage of time, or both, would be an Event of Default under the Loan Agreement.
c. No material adverse change has occurred in the financial
condition of Borrower since the date of the Second Amendment.
d. Borrower's execution, delivery and performance of this
amendment and all documents executed pursuant to this amendment have been duly
authorized by all necessary action, do not contravene any Law binding on it or
its organizational documents, and do not contravene the provisions of or
constitute a default under any agreement or instrument to which it is a party or
by which it may be bound or affected.
e. This amendment and all documents executed pursuant to this
amendment are, and when delivered will be, valid, binding and enforceable in
accordance with their respective terms.
<PAGE>
5. NOTICES. In modification of Paragraph 16.h. of the Loan Agreement,
and in modification of any notice provisions in the other Loan Documents,
Borrower designates the following address for notices:
Borrower: 4211 W. 11th Avenue
Eugene, OR 97405
Attention: Mr. Brian Obie
6. COUNTERPARTS; EXECUTION BY FACSIMILE. This amendment may be executed
in several counterparts, each of which will be deemed to be an original and all
of which together constitute one and the same instrument. Delivery of an
executed copy of this amendment by telecopy, telex or other means of electronic
communication producing a printed copy will be deemed to be an execution and
delivery of this amendment on the date of such communication by the parties so
delivering such a copy. The party so delivering such a copy via electronic
communication shall deliver an executed original of this amendment to the other
party within one (1) week of the date of delivery of the copy sent via
electronic communication.
7. EFFECT. Except as specifically modified by this amendment, or any
document executed pursuant to this amendment, the Loan Documents remain in full
force and effect.
8. DISCLOSURE. UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND
COMMITMENTS MADE BY A BANK AFTER OCTOBER 3, 1989, CONCERNING LOANS AND OTHER
CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR
SECURED SOLELY BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS
CONSIDERATION AND BE SIGNED BY THE BANK TO BE ENFORCEABLE.
Dated as of June 20, 1997.
OBIE MEDIA CORPORATION UNITED STATES NATIONAL BANK
OF OREGON
By: /s/ Brian Obie By: /s/ Larry Johnson
------------------------------ ------------------------------
Brian Obie, President Larry Johnson, Vice President
AMENDMENT NO. 1
TO
LEASE
BY AND BETWEEN
OBIE INDUSTRIES INCORPORATED
AND
OBIE MEDIA CORPORATION
This Amendment No. 1 to Lease (this "Amendment No. 1") is made
and entered into as of July 15, 1997 by and between Obie Industries
Incorporated, an Oregon corporation ("Landlord"), and Obie Media Corporation, an
Oregon corporation ("Tenant"), for the purpose of amending and modifying that
certain Lease dated November 12, 1996 by and between Landlord and Tenant (The
"Lease").
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant
agree as follows:
1. The first sentence of Section 4.1 of the Lease is hereby
amended to read as follows:
"Tenant shall pay to Landlord as rent for the Premises equal
monthly installments of $14,258."
2. Section 4.4 of the Lease is hereby amended in its
entirety to read as follows:
"4.4 TENANT IMPROVEMENTS. Tenant shall be responsible for a
total of $290,041 of tenant improvements in connection with
the renovation of the Premises."
3. As amended hereby, the Lease remains in full force and
effect.
IN WITNESS WHEREOF, Landlord and Tenant have executed this
Amendment No. 1 as of the date first written above.
"LANDLORD" "TENANT"
OBIE INDUSTRIES INCORPORATED OBIE MEDIA CORPORATION
By /s/ Brian B. Obie By /s/ Brian B. Obie
------------------------- -------------------------
Brian B. Obie, President Brian B. Obie, President
and Chief Executive Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial
information extracted from the financial
statements of Obie Media Corporation which
are included in its quarterly report, Form
10-QSB, for the quarter ended August 31,
1997 and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> Nov-30-1996
<PERIOD-END> Aug-31-1997
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 2,542,818
<ALLOWANCES> 171,781
<INVENTORY> 0<F1>
<CURRENT-ASSETS> 3,501,479
<PP&E> 12,409,808
<DEPRECIATION> 3,275,235
<TOTAL-ASSETS> 13,235,530
<CURRENT-LIABILITIES> 3,835,718
<BONDS> 6,763,136
0
0
<COMMON> 6,176,575
<OTHER-SE> (2,736,892)
<TOTAL-LIABILITY-AND-EQUITY> 13,235,530
<SALES> 0
<TOTAL-REVENUES> 9,824,490
<CGS> 0
<TOTAL-COSTS> 5,333,420
<OTHER-EXPENSES> 230,067
<LOSS-PROVISION> 0<F1>
<INTEREST-EXPENSE> 424,970
<INCOME-PRETAX> 1,044,844
<INCOME-TAX> 403,599
<INCOME-CONTINUING> 641,245
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 641,245
<EPS-PRIMARY> .18
<EPS-DILUTED> .18
<FN>
<F1> Information not included in Financial Statements
</FN>
</TABLE>
