<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
July 1, 1999
FISHER COMPANIES INC.
(Exact name of registrant as specified in its charter)
WASHINGTON
(State or other jurisdiction of incorporation)
000-22439 91-0222175
-------------------------- -------------------------------
(Commission File Number) IRS Employer Identification No.
1525 One Union Square
600 University Street
Seattle, Washington 98101-3185
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (206) 624-2752
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements of Business Acquired. The financial information
required by Item 7(a) is provided below, pursuant to Item 7(a)(4)
(b) Pro Forma Financial Information. The pro forma financial information
required by Item 7(b) is provided below, pursuant to Item 7(b)(2).
(c) Exhibits
2.1 Asset Purchase and Sale Agreement Among Fisher Companies Inc.,
and Fisher Broadcasting Inc., as the Purchaser and Retlaw
Enterprises, Inc., Retlaw Broadcasting, L.L.C., Retlaw
Broadcasting of Boise, L.L.C., Retlaw Broadcasting of Fresno,
L.L.C., Retlaw Broadcasting of Idaho Falls, L.L.C., Retlaw
Broadcasting of Yakima, L.L.C., Retlaw Broadcasting of Eugene,
L.L.C., Retlaw Broadcasting of Columbus, L.L.C., and Retlaw
Broadcasting of Augusta, L.L.C., as the Sellers, dated November
18, 1998, as amended November 30, 1998 and December 7, 1998
(filed as Exhibit 10.8 to the Company's Annual Report on Form 10-
K for the year December 31, 1998 (Commission File No. 000-22439).
2.2 Amendment No. 3 to Asset Purchase and Sale Agreement dated as of
June 30, 1999. (Incorporated by reference to the Form 8-K filed
by Fisher Companies Inc. dated July 15, 1999.)
2.3 Amendment No. 4 to Asset Purchase and Sale Agreement dated as of
July 1, 1999. (Incorporated by reference to the Form 8-K filed
by Fisher Companies Inc. dated July 15, 1999.)
23.1 Consent of PriceWaterhouseCoopers LLP
23.2 Consent of Miller, Kaplan, Arase & Co., LLP
99.1 Press Release issued by the Company on July 2, 1999.
(Incorporated by reference to the Form 8-K filed by Fisher
Companies Inc. dated July 15, 1999.)
2
<PAGE>
Retlaw Broadcasting, LLC
Report and Financial Statements
September 30, 1996, 1997 and 1998
3
<PAGE>
Report of Independent Accountants
To the Board of Directors
of Retlaw Enterprises, Inc.
In our opinion, the accompanying consolidated balance sheet and the related
consolidated statements of operations and changes in membership equity and of
cash flows present fairly, in all material respects, the financial position of
Retlaw Broadcasting, LLC (the "Company," a limited liability company wholly
owned by Retlaw Enterprises, Inc.) and its subsidiaries at September 30, 1998
and 1997, and the results of their operations and their cash flows for the years
then ended, in conformity with generally accepted accounting principles. These
financial statements are the responsibility of the Company's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Century City, California
December 11, 1998, except as to Note 14,
which is as of July 1, 1999
4
<PAGE>
Independent Auditors' Report
Retlaw Enterprises, Inc.
North Hollywood, California
We have audited the accompanying consolidated statements of operations, changes
in group equity and cash flows of Retlaw Broadcasting Group (the "Group," which
represents the broadcasting divisions of Retlaw Enterprises, Inc.) for the year
ended September 30, 1996. These financial statements are the responsibility of
the Group's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the consolidated financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the consolidated financial statements.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the results of the operations and the cash flows of the
Group for the year ended September 30, 1996, in conformity with generally
accepted accounting principles.
Miller, Kaplan, Arase & Co., LLP
North Hollywood, California
March 26, 1998
5
<PAGE>
Retlaw Broadcasting
Consolidated Balance Sheet
________________________________________________________________________________
<TABLE>
<CAPTION>
September 30,
---------------------------- June 30,
1997 1998 1999
(unaudited)
<S> <C> <C> <C>
Assets
Current assets
Cash and cash equivalents $ 995,000 $ 3,137,000 $ 2,235,000
Accounts receivable, less allowance for
doubtful accounts of $208,000, $221,000 and
$282,000 (unaudited) 5,529,000 7,823,000 8,637,000
Broadcast contract rights 5,408,000 9,596,000 7,864,000
Prepaid expenses and inventory 1,082,000 293,000 265,000
------------ ------------ ------------
Total current assets 13,014,000 20,849,000 19,001,000
Broadcast contract rights, less current portion 924,000 1,267,000 1,150,000
Investments and other assets
Investment in Southwest Oregon Television
Broadcasting Corporation 2,344,000 2,245,000 2,027,000
Deferred debt financing costs, net (Note 10) 1,038,000 1,948,000 1,734,000
Other assets 346,000 308,000 502,000
------------ ------------ ------------
Total other assets 3,728,000 4,501,000 4,263,000
Property and equipment, net (Note 4) 11,730,000 14,868,000 13,572,000
Goodwill and other intangibles, net (Note 2) 41,607,000 80,182,000 75,368,000
------------ ------------ ------------
Total assets $ 71,003,000 $121,667,000 $113,354,000
============ ============ ============
Liabilities and Equity
Current liabilities
Accounts payable $ 337,000 $ 844,000 $ 740,000
Accounts payable, affiliate (Note 5) 387,000 410,000 196,000
Accrued interest expense 121,000 1,200,000 547,000
Accrued payroll and related benefits 1,490,000 1,959,000 624,000
Other accrued liabilities 179,000 161,000 13,000
Broadcast contracts payable (Note 7) 6,140,000 9,340,000 8,303,000
Current debt payable (Note 10) 975,000 650,000
------------ ------------ ------------
Total current liabilities 8,654,000 14,889,000 11,073,000
Long-term debt (Note 10) 33,000,000 79,025,000 78,700,000
Broadcast contracts payable, less current portion
(Note 7) 913,000 1,867,000 975,000
Deferred compensation and retirement plan (Note 8) 1,073,000 1,365,000 1,376,000
------------ ------------ ------------
Total liabilities 43,640,000 97,146,000 92,124,000
Commitments and contingencies (Notes 13 and 14)
Group/member's equity 27,363,000 24,521,000 21,230,000
------------ ------------ ------------
Total liabilities and equity $ 71,003,000 $121,667,000 $113,354,000
============ ============ ============
</TABLE>
See accompanying notes.
6
<PAGE>
Retlaw Broadcasting, LLC
Consolidated Statement of Operations
________________________________________________________________________________
<TABLE>
<CAPTION>
For the year ended For the nine-months ended
September 30, June 30,
--------------------------------------------- -----------------------------
1996 1997 1998 1998 1999
(unaudited)
<S> <C> <C> <C> <C> <C>
Net revenues $ 25,066,000 $ 34,765,000 $ 41,740,000 $ 29,898,000 $ 37,334,000
Operating expenses
Programming, production and
other operating expenses 13,091,000 17,571,000 19,776,000 13,779,000 17,376,000
Promotion and selling expenses 3,073,000 4,012,000 4,754,000 3,203,000 4,828,000
General and administrative expenses 4,825,000 6,540,000 7,226,000 5,087,000 5,728,000
Depreciation and amortization 3,714,000 6,687,000 8,006,000 4,854,000 7,648,000
------------- ------------- ------------- ------------- -------------
Operating income (loss) 363,000 (45,000) 1,978,000 2,975,000 1,754,000
Interest expense 710,000 2,900,000 4,730,000 2,788,000 5,252,000
Other income 85,000 142,000 343,000 267,000 207,000
------------- ------------- ------------- ------------- -------------
Loss before extraordinary item (262,000) (2,803,000) (2,409,000) 454,000 (3,291,000)
Extraordinary item
Loss on early extinguishment
of debt (Note 10) (1,038,000) (1,038,000)
------------- ------------- ------------- ------------- -------------
Net loss $ (262,000) $ (2,803,000) $ (3,447,000) $ (584,000) $ (3,291,000)
============= ============= ============= ============= =============
</TABLE>
See accompanying notes.
7
<PAGE>
Retlaw Broadcasting, LLC
Consolidated Statement of Cash Flows
________________________________________________________________________________
<TABLE>
<CAPTION>
For the year ended For the nine-months ended
September 30, June 30,
--------------------------------------------- ----------------------------
1996 1997 1998 1998 1999
(unaudited)
<S> <C> <C> <C> <C> <C>
Cash flows from operating activities
Net loss $ (262,000) $ (2,803,000) $ (3,447,000) $ (584,000) $ (3,291,000)
Adjustments to reconcile net income
to net cash provided from
operating activities
Broadcasting contract payments (1,487,000) (2,226,000) (3,451,000) (2,589,000) (2,249,000)
Broadcasting contract amortization 1,711,000 2,415,000 3,074,000 2,300,000 2,169,000
Depreciation and amortization 3,714,000 6,687,000 8,006,000 4,854,000 7,648,000
Earnings from investment accounted
for under the equity method (35,000) (161,000) (169,000) (142,000) (142,000)
Loss on early extinguishment of debt 1,038,000 1,038,000
Net gain on sale of property
and equipment (3,000)
Changes in assets and liabilities
Accounts receivable (1,852,000) (598,000) (2,294,000) (2,640,000) (814,000)
Prepaid expenses and inventory (744,000) (45,000) 789,000 627,000 28,000
Other assets 70,000 38,000 438,000 (194,000)
Accounts payable and accrued
expenses 2,305,000 (723,000) 2,060,000 3,497,000 (2,840,000)
Deferred compensation 93,000 192,000 292,000 42,000 11,000
------------ ------------ ------------ ----------- ------------
Net cash provided by operating
activities 3,440,000 2,808,000 5,936,000 6,841,000 326,000
============ ============ ============ =========== ============
Cash flows from investing activities
Capital expenditures (1,514,000) (1,698,000) (1,409,000) (1,189,000) (938,000)
Purchase of television stations and
other investments (53,764,000) (104,000) (48,048,000) (48,048,000)
Dividends received from investment 75,000 125,000 89,000 360,000
Proceeds from the sale of property
and equipment 5,000
------------ ------------ ------------ ----------- ------------
Net cash used in investing
activities (55,273,000) (1,727,000) (49,332,000) (49,148,000) (578,000)
============ ============ ============ =========== ============
Cash flows from financing activities
Repayment of credit facilities (1,000,000) (34,000,000) (33,000,000) (650,000)
Borrowings under credit facilities 34,000,000 81,000,000 81,000,000
Debt issuance cost (2,067,000) (2,067,000)
Net transaction with Retlaw
Enterprises, Inc. (Note 6) 18,406,000 (200,000) 605,000 539,000
------------ ------------ ------------ ----------- ------------
New cash provided by (used in)
financing activities 52,406,000 (1,200,000) 45,538,000 46,472,000 (650,000)
------------ ------------ ------------ ----------- ------------
Net increase (decrease) in cash and
cash equivalents 573,000 (119,000) 2,142,000 4,165,000 (902,000)
Cash and cash equivalents at beginning
of period 541,000 1,114,000 995,000 995,000 3,137,000
------------ ------------ ------------ ----------- ------------
Cash and cash equivalents at end
of period $ 1,114,000 $ 995,000 $ 3,137,000 $ 5,160,000 $ 2,235,000
============ ============ ============ =========== ============
Supplemental cash flow information
Interest paid $ 710,000 $ 2,823,000 $ 3,661,000 $ 2,146,000 $ 4,065,000
============ ============ ============ =========== ============
</TABLE>
See accompanying notes.
8
<PAGE>
Retlaw Broadcasting, LLC
Consolidated Statement of Changes in Member's Equity
________________________________________________________________________________
<TABLE>
<CAPTION>
Group/
member's
equity
<S> <C>
Balance at September 30, 1995 $ 12,113,000
Net transactions with Retlaw Enterprises, Inc. (Note 6) 18,515,000
Net loss (262,000)
------------
Balance at September 30, 1996 30,366,000
Net transactions with Retlaw Enterprises, Inc. (Note 6) (200,000)
Net loss (2,803,000)
------------
Balance at September 30, 1997 27,363,000
Net transactions with Retlaw Enterprises, Inc. (Note 6) 605,000
Net loss (3,447,000)
------------
Balance at September 30, 1998 24,521,000
Net loss (unaudited) (3,291,000)
------------
Balance at June 30, 1999 (unaudited) $ 21,230,000
============
</TABLE>
See accompanying notes.
9
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
1. Business organization and basis of presentation
Retlaw Broadcasting, LLC ("the Company"), formerly known as Retlaw
Broadcasting Group (the "Group"), was a business entity "carved out" from
Retlaw Enterprises Inc. (the "Parent"). On April 30, 1998, these assets of
the Parent were transferred in a tax-free exchange to a wholly owned
Limited Liability Company (LLC) of the Parent under the laws of Delaware.
The respective group equity amounts as of April 30, 1998 were transferred
to membership interest to reflect this tax-free exchange. The LLC has
elected to be treated as a partnership for federal and state income tax
purposes; therefore, the ultimate tax liability is borne by the Parent
(Note 2). The Company's operations include television stations located in
California, Washington, Oregon, Idaho, Georgia and a 50% interest in the
issued and outstanding shares of the capital stock of the South West Oregon
Television Broadcasting Corporation ("South West").
The accompanying financial statements reflect the assets, liabilities,
revenues, expenses and cash flows of the Group through April 30, 1998 and
of the LLC thereafter. The transfer of Group assets to the LLC was
recorded at historical cost as the Group and LLC are under the common
control of the Parent. Certain corporate, general and administrative
expenses of Retlaw Enterprises, Inc. were allocated to the Company which,
in the opinion of management, are reasonable. However, such expenses are
not necessarily indicative of, and it is not practicable for management to
estimate the level of, expenses which might have been incurred had the
Company been operating as a separate business.
2. Summary of significant accounting policies
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of
the Company and its wholly owned subsidiaries. The interest in South West
is accounted for under the equity method. All significant intercompany
transactions are eliminated in consolidation.
Revenue Recognition
The Company's primary source of revenue is the sale of television time to
advertisers. Revenue is recorded when the advertisements are broadcast.
Broadcast Contract Rights and Broadcast Contracts Payable
Licensed broadcast rights represent amounts payable to program suppliers
for the limited right to broadcast the suppliers' programming. Broadcast
rights are recorded as assets when available for use at cost. The cost of
broadcasting rights is amortized on a straight line basis over the term of
the contract and is reported at the lower of unamortized cost or net
realizable value. The portion of broadcast rights that are expected to be
amortized and paid within one year are classified as
10
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
current assets and current liabilities respectively. Actual payments are
made in installments over a period generally the same as the license
period.
Barter Arrangements
The Company, in the ordinary course of business, provides commercial air
time to certain customers in exchange for syndicated film programming,
goods and services. Barter transactions are recorded on the basis of the
estimated fair market value of the commercial airtime given up. Revenue is
recognized as the related advertising is broadcast and expenses are
recognized when the related programming is aired or the goods or services
are received. Trade and barter revenue was $2,168,000, $4,022,000 and
$4,778,000 for the years ended September 30, 1996, 1997 and 1998,
respectively. Trade and barter expense was $2,096,000, $4,055,000 and
$4,778,000 for the years ended September 30, 1996, 1997 and 1998,
respectively.
Property and Equipment
Property and equipment is stated at cost less accumulated depreciation.
Depreciation on buildings and improvements is computed principally using
straight line and accelerated methods over their estimated useful lives of
4 to 40 years. Depreciation on machinery, equipment, automobiles,
furniture and fixtures is computed principally using accelerated methods
over their estimated useful lives of 3 to 15 years. Amortization of
leasehold improvements is computed using the straight-line method over the
shorter of the terms of the leases or their estimated useful lives.
Expenditures for improvements that add to the productive capacity or extend
the useful life of an asset are capitalized while expenditures for normal
repair and maintenance are expensed as incurred.
Goodwill and Other Intangibles
The purchase price of the net assets of broadcasting stations acquired in
excess of their fair market values and other intangibles are amortized
using the straight-line method over 15 years. Amortization expense was
$1,744,000, $3,826,000 and $4,977,000 for the years ended September 30,
1996, 1997 and 1998, respectively. Goodwill and other intangibles are
stated net of accumulated amortization of $16,835,000 and $22,850,000 at
September 30, 1997 and 1998, respectively.
Impairment of Long-Lived Assets
Periodically, the Company evaluates whether there has been an impairment in
the carrying value of the long-lived assets, such as intangibles and
property and equipment, in accordance with generally accepted accounting
principles. Management believes that the long-lived assets in the
accompanying balance sheet are appropriately valued.
11
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
Interest Rate Swap Agreements
The Company utilizes interest rate swap agreements to manage its exposure
to interest rate risk on its long term debt. The differential paid or
received on interest rate swap agreements is recorded as an adjustment to
interest expense over the term of the agreement.
Income Taxes
The Company is a Limited Liability Company that has elected to be treated
as a Partnership and is not subject to federal or state income taxes.
Accordingly, no recognition has been given to income taxes as the income or
loss is included on the tax returns of the Parent. When the company was
formed, all the tax responsibilities that arose during Company's existence
as part of an S Corporation remained with the Parent. Additionally,
certain assets contributed by the Parent and held by the Company are
subject to the built in gain provisions applicable to S Corporations. Any
tax liability resulting from the disposition of these assets will also be
borne by the Parent.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Recent Accounting Pronouncements
In June 1997, the Financial Accounting Standards Board (FASB) issued FAS
No. 131, "Disclosures about Segments of an Enterprise and Related
Information" (FAS 131). FAS 131 supersedes FAS No. 14, "Financial
Reporting for Segments of a Business Enterprise," replacing the "industry
segment" approach with the "management approach." The management approach
designates the internal organization that is used by management for making
operating decisions and assessing performance as the source of the
Company's reportable segments. FAS 131 also requires disclosures about
products and services, geographic areas and major customers. FAS 131 is
required to be adopted by the Company during the year end September 30,
1999. The Company does not believe the adoption of FAS 131 will have a
significant impact on its financial statements.
In June 1998, FAS No. 133, "Accounting for Derivative Instruments and
Hedging Activities" (FAS 133), was issued. This pronouncement standardizes
the accounting for derivative instruments by requiring that an entity
recognize those items as assets or liabilities in the financial statements,
and measure them at fair value. FAS 133 is required to be adopted by the
Company for the year end September 30, 2001. Early adoption is permitted.
The Company is currently
12
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
reviewing the requirements of FAS 133 and assessing its impact on the
Company's financial statements.
Unaudited Interim Financial Statements
The interim financial data as of June 30, 1999 and for the nine months
ended June 30, 1998 and 1999 is unaudited; however, in the opinion of
management, the interim data includes all adjustments, consisting only of
normal recurring adjustments necessary to present fairly the Company's
financial position as of June 30, 1999 and the results of its operations
and cash flows for the nine months ended June 30, 1998 and 1999.
Reclassifications
Certain amounts in the 1996 financial statements have been reclassified to
conform with current year presentation.
3. Concentration of credit risk
The Company maintains its cash in bank deposit accounts that, at any time,
may exceed federally insured limits. The Company has not experienced any
losses in such accounts. The Company believes it is not exposed to any
significant credit risk on cash and cash equivalents. Financial
instruments, which potentially subject the Company to concentrations of
credit risk, consist of trade accounts receivable. The Company's sales and
trade accounts receivable are generated principally from advertising from a
large number of national, regional and local customers from many different
industries located in its operating locations. Credit is extended based on
evaluation of the customer's financial condition. Credit losses are
provided for in the financial statements and have consistently been within
management's expectations. No single customer represented more than 10% of
sales in fiscal 1996, 1997 or 1998.
13
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
4. Property and equipment
Net property and equipment consist of the following:
<TABLE>
<CAPTION>
September 30,
1997 1998
<S> <C> <C>
Machinery and equipment $ 20,096,000 $ 22,201,000
Buildings and leasehold improvements 5,339,000 6,362,000
Land 2,048,000 2,777,000
Automobiles 848,000 983,000
Furniture and fixtures 446,000 694,000
------------ ------------
28,777,000 33,017,000
Less: Accumulated depreciation and amortization (17,047,000) (18,149,000)
------------ ------------
Net property and equipment $ 11,730,000 $ 14,868,000
------------ ------------
</TABLE>
Depreciation expense was $1,971,000, $2,861,000 and $3,029,000 for the
years ended September 30, 1996, 1997 and 1998, respectively.
5. Accounts payable, affiliate
The Company is a 50% investor in South West and manages the operations of
the satellite station owned by South West. As a result of the
relationship, certain revenues and expenses are allocated to the satellite
station from the Company. As of September 30, 1997 and 1998, the accounts
payable due to the affiliate was $387,000 and $410,000, respectively.
Additionally, the Company's equity share of net income of $35,000, $161,000
and $169,000 for the years ended September 30, 1996, 1997 and 1998,
respectively, have been included in other income.
14
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
6. Transactions with Retlaw Enterprises, Inc.
Intercompany transactions between the Parent and the Company are summarized
as follows:
<TABLE>
<CAPTION>
For the year ended
September 30,
-------------------------------------------------------------
1996 1997 1998
<S> <C> <C> <C>
Net cash transfers $ 51,434,000 $ (6,521,000) $ (4,009,000)
Net operating expense allocation 371,000 2,421,000 1,925,000
Interest expense allocations 710,000 2,900,000 1,689,000
Net principal payments on debt (34,000,000) 1,000,000 1,000,000
------------- -------------- --------------
Total $ 18,515,000 $ (200,000) $ 605,000
============= ============== ==============
</TABLE>
The Parent allocated costs to the Company relating to corporate services
such as salaries and human resources, insurance premium maintenance, and
external accounting. Such costs were allocated based on the relative
percentage of time and resources spent by the Parent on behalf of the
Company. Interest expense incurred and principal payments paid by the
Parent relating to the long-term debt were also allocated to the Company.
Management believes that the allocation methods were reasonable in the
circumstances.
7. Broadcast contracts payable
At September 30, 1998, the Company had broadcast contracts payable of
$4,865,000 due in cash and $6,342,000 of bartered commercial air time.
Aggregate maturities or payments required on these contracts are as follows
for the year ending September 30:
Year ending,
1999 $ 2,999,000
2000 1,305,000
2001 545,000
2002 16,000
------------
Total $ 4,865,000
============
The approximate fair value of broadcast contracts payable classified as
non-current as of September 30, 1998 was $1,590,000. The fair value was
estimated using a discount rate of 9%.
15
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
8. Deferred compensation and retirement plans
The Company has a qualified profit-sharing plan that covers eligible
employees. On January 1, 1993 the company established a 401(k) Plan for
its employees. Eligible employees may contribute a percentage of their
pre-tax income to the plan up to certain limitations prescribed by the
Internal Revenue Code. The Company matches employee contributions up to a
maximum of 4% of participating employees' gross wages. The Company
contributed $365,000 and $394,000 for the years ended September 30, 1997
and 1998, respectively.
The Company has an unfunded key employee deferred compensation and
retirement plan providing for Company contributions and employee deferrals.
The accrued liabilities related to this plan are as follows:
September 30,
1997 1998
Company accruals $ 720,000 $ 935,000
Employee contributions 190,000 190,000
Accrued interest 163,000 230,000
----------- -----------
$ 1,073,000 $ 1,355,000
=========== ===========
Total expense under this Plan was $225,000, $191,000, $282,000 for the
years ended September 30, 1996, 1997 and 1998, respectively.
9. Leasing operations
The Company leases to various third parties real property, transmitter
sites and facilities and office space with initial terms ranging from one
to twenty years. A number of the leases include renewal options and call
for annual rental increases as provided in the lease agreement or based on
changes in the Consumer Price Index. Total rental income included in the
financial statements was $45,000, $265,000 and $304,000 for the years ended
September 30, 1996, 1997 and 1998, respectively.
16
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
Aggregate future minimum rental payments due to the Company under rental
agreements that have initial or remaining non-cancelable terms for the next
five years and thereafter as of September 30, 1998 are as follows:
Year ending,
1999 $ 244,000
2000 238,000
2001 231,000
2002 124,000
2003 54,000
Thereafter 141,000
------------
$ 1,032,000
============
10. Long-term debt
In fiscal year 1996, the Parent, on behalf of the Company, entered into a
Credit Agreement with First Union National Bank of North Carolina ("First
Union") and CIBC, Inc. The credit facility consisted of revolving and term
loans. The maximum borrowings under the facility were $36,000,000 for the
revolving loan, subject to certain reductions, and $8,000,000 for the term
loan. However, as of April 30, 1998 the term loan and revolving balances
were paid in their entirety as a part of a refinancing for the acquisition
of the Georgia Stations in Columbus and Augusta (Note 12). Deferred
financing costs of $1,038,000, net of accumulated amortization, related to
the old agreement were charged to current year operations. The new Credit
Agreement with First Union for $85,000,000 includes a $20,000,000 Senior
Secured Revolving Credit Facility and $65,000,000 Senior Secured Term Loan
Facility. At April 30, 1998, $81,000,000 was provided for payment in full
of the former term loan and revolving credit line which totaled $32,028,000
as well as $46,000,000 for the acquisition of the Georgia Stations and
$2,067,000 for agent and administrative fees which were capitalized as
deferred loan cost and will be amortized over the respective loan period.
The remainder of the proceeds was used for working capital.
Long -Term Debt consists of the following:
September 30,
1997 1998
Aggregate revolving loans $ 25,000,000 $ 15,000,000
Term loan 8,000,000 65,000,000
------------ ------------
33,000,000 80,000,000
Less: Current portion -- 975,000
------------ ------------
$ 33,000,000 $ 79,025,000
============ ============
17
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
The Company can choose to have the interest computed under a "Alternate
Base Rate" or a "LIBOR Rate" as defined in the Credit Agreement.
The Alternate Base Rate is a variable rate of interest based on First
Union's prime rate of interest, the Federal Funds Effective Rate and the
ratio of funded debt. The Company as of September 30, 1998 had no
outstanding debt subject to the Alternate Base Rate.
The LIBOR Rate is a variable rate of interest based on the London Interbank
Offered Rate, the Eurodollar Reserve Percentage, and the ratio of funded
debt. The interest rates in effect at September 30, 1998 for the Revolving
Loans were 5.69% plus 3%, or 8.69%. and 5.53% plus 3% or 8.53%. The
outstanding Revolving Loans subject to the LIBOR Rate interest computation
of 8.69% and 8.53% at September 30, 1998 were $12,000,000 and $3,000,000,
respectively.
The unused portion of the Revolving Loan subject to the terms of the
related Credit Agreement at September 30, 1998 was $5,000,000. The Company
is obligated to pay a commitment fee computed at the rate of 0.50% per
annum on the average daily unused revolving committed amount. There was no
amount outstanding under the commitment fee obligation at September 30,
1998. The Revolving Loan Facility is required to be paid in its entirety
on March 31, 2003.
Aggregate amounts of reductions and resulting maximum commitments under the
Credit Agreement for the Revolving Loan Facility are as follows for the
year ending September 30:
Maximum
revolving
Amount of committed
Year ending, reduction amount
1999 $ 4,000,000 $ 16,000,000
2000 4,000,000 12,000,000
2001 4,500,000 7,500,000
2002 5,000,000 2,500,000
2003 2,500,000 --
------------
$ 20,000,000
18
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
Aggregate amounts of Principal payments to be made on the Term Loan
Facility for the next five years and thereafter are as follows for year
ending September 30:
Amount of
Year ending, payment
1999 $ 975,000
2000 650,000
2001 650,000
2002 650,000
2003 650,000
Thereafter 61,425,000
------------
Total $ 65,000,000
============
The Term Loan Facility consists of an aggregate principal amount of
$65,000,000 payable in consecutive quarterly installments beginning
December 31, 1998. The interest rate in effect at September 30, 1998 was
the LIBOR Rate plus 3.5%, or 9.19%.
Obligations under the Credit Agreement are secured by substantially all
assets of the Company as defined in the Security and Pledge Agreement dated
April 30, 1998. The Company is obligated by various loan covenants that
include debt service, funded debt and capital expenditure limitations and
interest and fixed charge covenant requirements.
On April 30, 1998, the Company entered into an additional interest rate
swap agreement with First Union to reduce its exposure to interest rate
changes on its floating rate debt. The swap agreements effectively change
its floating interest rate exposure to a 6.30% and 5.50% LIBOR fixed rate
based upon notional amounts of $18,000,000 and $30,000,000, respectively.
The swap agreements mature on November 1, 1999 and may be extended to May
1, 2001 at the option of First Union. For the year ended September 30,
1998, the Company paid $92,000 in additional interest expense, representing
the differential of the fixed rate and the counterparty's floating rate.
The Company is exposed to credit loss in the event of non-performance by
the counterparty to the swap agreement, although the Company does not
anticipate non-performance by the counterparty. As of September 30, 1998,
the estimated fair market value of the swap agreements are $710,000 and
$605,000, respectively in a payable position.
19
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
11. Fair value of financial instruments
The following methods and assumptions were used to estimate the fair value
of each class of financial instruments for which it is practical to
estimate that value.
Cash and Cash Equivalents
Cash and cash equivalents have maturities of three months or less. The
carrying amounts approximate fair value.
Accounts and Notes Receivable
The carrying value of accounts receivable approximates the fair value due
to the short-term nature of these instruments.
Accounts Payable and Accrued Liabilities
The carrying value of accounts payable and accrued expenses approximates
the fair value due to the short-term nature of these instruments.
Borrowings
The carrying amount is a reasonable estimate of fair value as short-term
borrowings are advanced at current interest rates and interest rates on
long-term borrowings are based on floating interest rates. (See Note 10
regarding interest rate swap agreements.)
12. Acquisitions
On June 27, 1996, the Parent, on behalf of the Company, purchased the
assets of television stations KVAL-TV, Eugene, Oregon; KCBY-TV, Coos Bay,
Oregon; KBCI-TV, Boise, Idaho; and a 50% interest in the stock of South
West, which operates television station KPIC-TV, located in Roseburg,
Oregon from Northwest Television, Inc. ("Northwest"). The acquisition was
accounted for under the purchase method. The interest in South West has
been recorded using the equity method. Also included in the purchase were
three sign producing companies, which are located on each of the properties
of the stations acquired. The total purchase price was $53,764,000. The
goodwill associated with the acquisitions is amortized over 15 years in
accordance with the Company's policies.
On May 1, 1998, the Company purchased the assets of Augusta Family
Broadcasting, Inc., and Columbus Family Broadcasting, Inc., which included
stations in Augusta and Columbus, Georgia ("Georgia Stations"). The total
cost of acquisition was approximately $48,000,000. The acquisition, which
was financed through Senior Secured Notes and Revolving Credit Facilities
with First Union, has been accounted for as a purchase under the provisions
of Accounting
20
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
Principles Board Opinion No. 16, "Business Combinations". The goodwill and
other intangibles associated with the acquisition will be amortized over 15
years on a straight-line basis.
The results of operations of the acquired stations are included in the
consolidated financial statements from the dates of acquisition. Unaudited
pro forma results as if the acquired stations had been included in the
financial results since the beginning of the year prior to their
acquisition are as follows:
For the year ended
September 30,
-------------------------------------------------
1996 1997 1998
(unaudited)
Net revenues $ 36,549,000 $ 45,739,000 $ 45,031,000
Net loss $ (2,408,000) $ (7,912,000) (7,486,000)
13. Commitments and contingencies
Broadcast Rights
The aggregate amount payable by the Company under contracts for programming
not currently available for telecasting, and accordingly, not included in
the broadcast contracts payable and the related broadcast contract rights
in the accompanying consolidated balance sheet, totaled $2,673,000 at
September 30, 1998.
Leases
At September 30, 1998, the Company was obligated under several non-
cancelable leases on property and equipment. Aggregate future minimum
rental payments under such leases at September 30, 1998 are as follows:
Year ending,
1999 $ 84,000
2000 52,000
2001 41,000
2002 32,000
2003 27,000
Thereafter 133,000
----------
$ 369,000
==========
Total rental expense was $46,000, $131,000 and $111,000 for the years ended
September 30, 1996, 1997 and 1998, respectively.
21
<PAGE>
Retlaw Broadcasting, LLC
Notes to Consolidated Financial Statements
September 30, 1996, 1997 and 1998
________________________________________________________________________________
Legal
The Company is subject to various lawsuits, claims and assessments that are
routine to the nature of the business. While the ultimate outcome of these
matters is difficult to predict, management estimates that the ultimate
resolution of these matters will not have a material adverse effect on the
Company's financial position, results of operations or cash flows.
14. Subsequent events
In November of 1998, the Parent entered into an agreement to sell the
assets of Retlaw Broadcasting, LLC for a sum of $216,700,000, which
includes $7,600,000 of working capital, to the Fisher Companies Inc. The
acquisition was completed on July 1, 1999.
22
<PAGE>
UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
On July 1, 1999, Fisher Companies Inc., a Washington corporation ("FSCI"), and
its subsidiary Fisher Broadcasting Inc. completed the acquisition of the
broadcasting assets of Retlaw Enterprises, Inc., a California corporation, and
eight wholly-owned limited liability companies ("Retlaw"). The broadcast assets
acquired consist of eleven network-affiliated television stations in seven
markets located in California, the Pacific Northwest, and Georgia.
The acquired television stations will be owned and operated by Fisher
Broadcasting Inc.
Total consideration for the assets acquired was $216.7 million, which included
$7.6 million of working capital. The amount of such purchase price was
negotiated between the parties.
The acquisition was financed from proceeds of Senior Credit Facilities with Bank
of America National Trust and Savings Association as Administrative Agent,
Credit Suisse First Boston as Syndication Agent, and other financial
institutions party thereto.
The unaudited pro forma combined statements of operations set forth below gives
effect to the acquisition of Retlaw by FSCI as if it had occurred on January 1,
1998. The unaudited pro forma combined balance sheet set forth below gives
effect to the acquisition of Retlaw by FSCI as if it had occurred on June 30,
1999. The historical financial information set forth below has been derived
from the financial statements of FSCI and Retlaw, and should be read in
conjunction with those financial statements and the notes to such financial
statements. The financial statements and notes to the financial statements of
Retlaw are included elsewhere herein. The financial statements and notes to the
financial statements of FSCI are included in FSCI's Annual Report on Form 10-K
filed on March 25, 1999.
The acquisition has been accounted for using the purchase method of accounting.
These pro forma financial statements have been prepared on the basis of
assumptions described herein.
The unaudited pro forma combined financial information set forth below combines
FSCI's balance sheet as of June 30, 1999, and statements of operations for the
year ended December 31, 1998 and for the six months ended June 30, 1999 with the
balance sheet and statements of operations of Retlaw as of June 30, 1999 and for
the fiscal year ended September 30, 1998 and the six months ended June 30, 1999.
The unaudited pro forma combined statements of operations do not include Retlaw
financial information for the period from October 1, 1998 through December 31,
1998. Retlaw's net revenues and net income for this period were $14.3 million
and $669,000, respectively. These pro forma financial statements reflect
certain adjustments, including adjustments to reflect the amortization of
goodwill acquired, interest expense related to the acquisition indebtedness and
the tax effect of including Retlaw's net loss in FSCI's results of operations.
The pro forma adjustments are based on consideration exchanged and the estimated
fair value of assets acquired and liabilities assumed. The actual adjustments
may differ from the estimates made herein.
The unaudited pro forma combined financial information set forth below does not
purport to represent what the consolidated results of operations or financial
condition of FSCI would actually have been if the Retlaw acquisition and related
transactions had in fact occurred on such date or to project the future
consolidated results of operations or financial condition of FSCI.
23
<PAGE>
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
Fisher Retlaw Pro forma
(Historical) (Historical) adjustments Total
------------ ------------ ----------- --------
(in thousands, except share and per share amounts)
<S> <C> <C> <C> <C>
Sales and other revenue:
Broadcasting $127,637 $ 41,740 $ 3,291 (8) $172,668
Milling 108,056 108,056
Real estate 12,265 12,265
Corporate and other, primarily dividends
and other interest income 4,224 343 (7) 4,567
-------- -------- --------- --------
252,182 41,740 3,634 297,556
-------- -------- --------- --------
Costs and expenses:
Cost of products and services sold 157,526 19,776 1,290 (4) 179,840
1,248 (8)
Selling expenses 20,203 4,754 632 (8) 25,589
General, administrative and other expenses 37,898 7,226 4,895 (3) 50,317
298 (8)
Depreciation and amortization 8,006 (5,930)(3) -
(3,560)(4)
1,484 (8)
-------- -------- --------- --------
215,627 39,762 357 255,746
-------- -------- --------- --------
Income from operations
Broadcasting 33,937 1,978 2,934 38,849
Milling (1,440) (1,440)
Real estate 4,117 4,117
Corporate and other (59) 343 284
-------- -------- --------- --------
36,555 1,978 3,277 41,810
Interest expense 4,451 4,730 (6,187)(5) 21,635
17,184 (6)
1,457 (8)
Other income 343 (343)(7) -
-------- -------- --------- --------
Income (loss) before provision for income taxes
and extraordinary item 32,104 (2,409) (9,520) 20,175
Provision for federal and state income taxes 11,047 (2,427)(9) 8,620
-------- -------- --------- --------
Income (loss) before extraordinary item $ 21,057 $ (2,409) $ (7,093) $ 11,555
======== ======== ========= ========
Income before extraordinary item per share $ 2.47 $ 1.35
Income before extraordinary item per share
assuming dilution $ 2.46 $ 1.35
Weighted average number of shares outstanding 8,541 8,541
Weighted average number of shares outstanding
assuming dilution 8,575 8,575
</TABLE>
24
<PAGE>
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999
<TABLE>
<CAPTION>
Fisher Retlaw Pro forma
(Historical) (Historical) adjustments Total
------------ ------------ ----------- --------
(in thousands, except share and per share amounts)
<S> <C> <C> <C> <C>
Sales and other revenue:
Broadcasting $ 61,027 $ 23,058 $ 84,085
Milling 53,546 53,546
Real estate 16,221 16,221
Corporate and other, primarily dividends
and other interest income 2,285 $ 117 (7) 2,402
-------- -------- --------- --------
133,079 23,058 117 156,254
-------- -------- --------- --------
Costs and expenses:
Cost of products and services sold 78,724 11,412 645 (4) 90,781
Selling expenses 10,502 3,210 13,712
General, administrative and other expenses 22,270 3,848 2,448 (3) 28,566
Depreciation and amortization 5,236 (3,726)(3) -
(1,510)(4)
-------- -------- --------- --------
111,496 23,706 (2,143) 133,059
-------- -------- --------- --------
Income from operations
Broadcasting 12,671 (648) 2,143 14,166
Milling (1,576) (1,576)
Real estate 11,698 11,698
Corporate and other (1,210) 117 (1,093)
-------- -------- --------- --------
21,583 (648) 2,260 23,195
Interest expense 2,256 3,430 (3,430)(5) 10,848
8,592 (6)
Other income 117 (117)(7) -
-------- -------- --------- --------
Income before provision for income taxes 19,327 (3,961) (3,019) 12,347
Provision for federal and state income taxes 6,497 (2,208)(9) 4,289
-------- -------- --------- --------
Net income (loss) $ 12,830 $ (3,961) $ (811) $ 8,058
======== ======== ========= ========
Net income per share $ 1.50 $ 0.94
Net income per share assuming dilution $ 1.50 $ 0.94
Weighted average number of shares outstanding 8,546 8,546
Weighted average number of shares outstanding
assuming dilution 8,574 8,574
</TABLE>
25
<PAGE>
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
AS OF JUNE 30, 1999
<TABLE>
<CAPTION>
Fisher Retlaw Pro forma
(Historical) (Historical) Adjustments Total
------------ ------------ ----------- --------
(in thousands)
<S> <C> <C> <C> <C>
Assets
Current assets:
Cash and short-term cash investments $ 224,208 $ 2,235 $ (2,235) (2) $ 7,532
(216,676) (1)
Receivables 42,767 8,637 51,404
Inventories 14,444 14,444
Prepaid expenses 6,169 265 (664)(10) 5,770
Television and radio broadcast rights 3,489 7,864 (5,962) (2) 5,391
-------- -------- --------- --------
Total current assets 291,077 19,001 (225,537) 84,541
-------- -------- --------- --------
Marketable securities, at market value 137,034 137,034
-------- -------- --------- --------
Other assets
Cash value of life insurance and retirement deposits 11,186 11,186
Television and radio broadcast rights 49 1,150 (6) (2) 1,193
Intangible assets, net of amortization 47,992 75,368 (75,368) (2) 243,789
195,797 (1)
Investments in equity investees 15,500 2,027 703 (11) 18,230
Other 12,378 2,236 (2,236) (2) 8,557
(3,821)(10)
-------- -------- --------- --------
87,105 80,781 115,069 282,955
-------- -------- --------- --------
Property, plant and equipment, net 164,922 13,572 2,324 (11) 180,818
-------- -------- --------- --------
Total assets $ 680,138 $ 113,354 $(108,144) $685,348
-------- -------- --------- --------
Liabilities and Stockholders' Equity
Current liabilities
Notes payable $ 20,046 $ 650 $ (650) (2) $ 20,046
Trade accounts payable 13,960 740 14,700
Accrued payroll and related benefits 3,913 624 (283) (2) 4,254
Television and radio broadcast rights payable 1,856 8,303 (6,033) (2) 4,126
Income taxes payable 262 262
Dividends payable 2,223 2,223
Other current liabilities 2,822 756 (172) (2) 3,706
300 (12)
-------- -------- --------- --------
Total current liabilities 45,082 11,073 (6,838) 49,317
-------- -------- --------- --------
Long-term debt, net of current maturities 281,719 78,700 (78,700) (2) 281,719
-------- -------- --------- --------
Television and radio broadcast rights payable, net of
current portion 975 975
Other liabilities
Accrued retirement benefits 13,020 1,376 (1,376) (2) 13,020
Deferred income taxes 60,534 60,534
Deposits and retainage payable 1,148 1,148
-------- -------- --------- --------
74,702 1,376 (1,376) 74,702
-------- -------- --------- --------
Minority interests 33 33
-------- -------- --------- --------
Stockholders' equity
Common stock 10,688 10,688
Capital in excess of par 2,439 2,439
Deferred compensation (753) (753)
Accumulated other comprehensive income 88,326 88,326
Retained earnings 177,902 177,902
Group/member's equity 21,230 (21,230) (2) -
-------- -------- --------- --------
Total stockholders' equity 278,602 21,230 (21,230) 278,602
-------- -------- --------- --------
Total liabilities and stockholders' equity $680,138 $113,354 $(108,144) $685,348
======== ======== ========= ========
</TABLE>
26
<PAGE>
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
Pro forma adjustments for the unaudited pro forma combined balance sheet as of
June 30, 1999 and statements of operations for the year ended December 31, 1998
and the six months ended June 30, 1999 are as follows:
1. Reflects the payment of $216.7 million in consideration by FSCI at closing
of the acquisition and other acquisition costs incurred in connection with
the acquisition and the allocation of these amounts to tangible and
intangible assets acquired and liabilities assumed.
2. Reflects elimination of assets not acquired, liabilities not assumed and
Retlaw's group/member's equity.
3. Reflects the amortization of the goodwill resulting from the acquisition on
a straight-line basis over 40 years, net of elimination of the historical
amortization of goodwill acquired by Retlaw in prior acquisitions, and the
reclassification of amortization to conform to FSCI's presentation of
expenses.
4. Reflects the change in depreciation expense for the increase in the value of
the property and equipment acquired, and the reclassification of
depreciation to conform to FSCI's presentation of expenses.
5. Reflects the elimination of interest expense on Retlaw debt not assumed by
FSCI.
6. Reflects the interest expense resulting from borrowings incurred to finance
the acquisition. The interest rate on borrowings is assumed to be 7.32%,
which is the rate in effect on the date of closing of the acquisition. The
Company had entered into an interest rate swap agreement which fixes the
interest rate on $90 million notional amount at 8.52%. Including the effect
of the swap, the effective interest rate is 7.81%. If interest rates change
by a magnitude of 1/8 of 1%, the annual effect on pro forma interest expense
would be $163,000.
7. Reflects the reclassification of other income to conform to Fisher's
presentation of revenues and other income.
8. Reflects the pro forma effect of Retlaw's acquisition of the assets of
Augusta Family Broadcasting, Inc. on May 1, 1998 for $48,000,000 as if the
acquisition had been made as of January 1, 1998. The pro forma statement of
operations data for Augusta Family Broadcasting from January 1, 1998 through
April 30, 1998 are derived as follows (in thousands):
<TABLE>
<CAPTION>
Pro Forma
Historical Adjustments Pro Forma
---------- ------------ ----------
<S> <C> <C> <C>
Net revenues 3,291 3,291
Costs and expenses
Cost of products and services sold 1,248 1,248
Selling expenses 632 632
General and administrative expenses 298 298
Depreciation and amortization 146 (146)(a) 1,484
953 (b)
531 (C)
----- ------ ------
Income (loss) from operations 967 (1,338) (371)
</TABLE>
27
<PAGE>
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
<TABLE>
<S> <C> <C> <C>
Interest expense 25 (25)(d) 1,457
1,457 (e)
Net income (loss) 942 (2,770) (1,828)
----- ------ ------
</TABLE>
(a) Reflects elimination of historical depreciation and amortization of
Augusta Family Broadcasting.
(b) Reflects the amortization of goodwill resulting from the acquistion of
Augusta Family Broadcasting on a straight-line basis over 15 years.
(c) Reflects depreciation of the new basis of property and equipment
acquired from August Family Broadcasting.
(d) Reflects elimination of interest expense on Augusta Family
Broadcasting debt not assumed by Retlaw.
(e) Reflects the interest expense resulting from borrowings incurred to
finance the acquisition of Augusta Family Broadcasting, at an assumed
weighted average interest rate of 9.08%.
9. Reflects the tax effect of including Retlaw's net loss in FSCI's results of
operations after taking into account the above pro forma adjustments.
10. Reflects acquisition costs incurred by FSCI as of June 30, 1999. These
costs are reclassified from prepaid expenses and other assets to intangible
assets.
11. Reflects step-up in basis to fair value.
12. Reflects $300,000 of estimated additional direct acquisition costs to be
incurred.
28
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amended report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: September 14, 1999
FISHER COMPANIES INC.
By: /s/ David D. Hillard
-------------------------------------
David D. Hillard
Senior Vice President, Chief Financial Officer
and Secretary
29
<PAGE>
EXHIBIT 23.1
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-32103) of Fisher Companies Inc. of our report
dated December 11, 1998, except as to Note 14, which is as of July 1, 1999,
relating to the financial statements of Retlaw Broadcasting, LLC, which appears
in the Current Report on Form 8-K of Fisher Companies Inc. dated September 14,
1999.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Century City, California
September 13, 1999
<PAGE>
EXHIBIT 23.2
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-32103) of Fisher Companies Inc. of our report
dated March 26, 1998, relating to the financial statements of Retlaw
Broadcasting, LLC, which appears in the Current Report on Form 8-K of Fisher
Companies Inc. dated September 14, 1999.
/s/ Miller, Kaplan, Arase & Co., LLP
Miller, Kaplan, Arase & Co., LLP
North Hollywood, California
September 13, 1999
