<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------------
FORM 8
AMENDMENT TO APPLICATION OR REPORT
Pursuant to Section 12, 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 3, 1994
WESTWOOD ONE, INC.
(Exact name of registrant as specified in its charter)
AMENDMENT NO. 1
The undersigned registrant hereby amends the following items of its
Current Report on Form 8-K dated February 3, 1994 as set forth in the attached
pages hereto:
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro Forma Financial Information
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned thereunto duly authorized.
WESTWOOD ONE, INC.
(Registrant)
By: FARID SULEMAN
------------------------------
Farid Suleman
Executive Vice President-Chief
Financial Officer
February 15, 1994
<PAGE> 2
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro Forma Financial Information.
The following Unaudited Pro Forma Combined financial data presents the
Pro Forma Combined Condensed Balance Sheet at November 30, 1993, giving effect
to the Acquisition and the execution of the New Senior Loan, as if the
Acquisition had taken place on that date. Also presented is the Unaudited Pro
Forma Combined Condensed Statement of Operations for the year ended November
30, 1993, giving effect to the Acquisition and the execution of the New Senior
Loan, as if the Acquisition had taken place as of the beginning of the period
presented.
These pro forma statements and accompanying notes are based upon and
should be read in conjunction with the historical Financial Statements and
related notes thereto of each of the Company and Unistar, giving effect to the
Acquisition under the assumptions and adjustments in the accompanying Notes To
Unaudited Pro Forma Combined Condensed Financial Statements. The pro forma
information presented does not purport to represent the actual results which
would have occurred if the Acquisition had been consummated on the dates or for
the periods indicated, nor is it indicative of the operating results in any
future period.
<PAGE> 3
WESTWOOD ONE, INC.
UNAUDITED PRO FORMA COMBINED CONDENSED BALANCE SHEET
AT NOVEMBER 30, 1993
(In thousands)
ASSETS
------
<TABLE>
<CAPTION>
Historical Pro Forma
---------------------- -------------------------
Westwood One Unistar Adjustments Combined
------------ ------- ----------- --------
(NOTE C)
<S> <C> <C> <C> <C>
CURRENT ASSETS . . . . . . . . . . . . . . . . . . . . . . $32,987 $19,027 ($18,310)(1) $52,756
(20,089)(2)
125,000 (3)
15,000 (4)
(100,859)(5)
PROPERTY AND EQUIPMENT . . . . . . . . . . . . . . . . . . 15,984 3,397 - 19,381
DEFERRED PRODUCTION COSTS . . . . . . . . . . . . . . . . 6,185 - - 6,185
INTANGIBLE ASSETS, NET OF
ACCUMULATED AMORTIZATION . . . . . . . . . . . . . . . . 90,745 - (20,812)(1) 191,431
15,000 (2)
5,089 (2)
101,409 (8)
OTHER ASSETS . . . . . . . . . . . . . . . . . . . . . . . 6,166 101,409 2,500 (5) 9,666
1,000 (7)
(101,409)(8)
-------- -------- ------- --------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . $152,067 $123,833 $3,519 $279,419
======== ======== ======= ========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES . . . . . . . . . . . . . . . . . . . $34,490 $20,951 ($20,951)(1) $26,284
(8,206)(5)
LONG-TERM DEBT . . . . . . . . . . . . . . . . . . . . . . 51,943 103,169 (18,458)(1) 140,443(5)
125,000 (3)
(90,153)(5)
(31,058)(6)
OTHER LIABILITIES . . . . . . . . . . . . . . . . . . . . 10,483 - - 10,483
-------- -------- ------- -------
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . 96,916 124,120 (43,826) 177,210
SHAREHOLDERS' EQUITY . . . . . . . . . . . . . . . . . . . 55,151 (287) 287 (1) 102,209
15,000 (4)
31,058 (6)
1,000 (7)
-------- -------- ------ --------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY . . . . . . . . . . . . . . . . . . $152,067 $123,833 $3,519 $279,419
======== ======== ====== ========
See Accompanying Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
</TABLE>
<PAGE> 4
WESTWOOD ONE, INC.
UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED NOVEMBER 30, 1993
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Historical Pro Forma
---------------------- -------------------------
Westwood One Unistar Adjustments Combined
------------ ------- ----------- --------
(NOTE D)
<S> <C> <C> <C> <C>
REVENUE . . . . . . . . . . . . . . . . . . . . . . . . . $ 99,579 $68,190 - $167,769
OPERATING COSTS AND EXPENSES . . . . . . . . . . . . . . 101,770 61,961 (947)(1) 163,014
230 (2)
- (5)
-------- ------- ------- --------
OPERATING INCOME (LOSS) . . . . . . . . . . . . . . . . . (2,191) 6,229 717 4,755
-------- ------- ------- --------
Interest Expense . . . . . . . . . . . . . . . . . . . . 6,551 6,318 (2,139)(3) 10,730
Other Expense (Income) . . . . . . . . . . . . . . . . . (60) 193 - 133
-------- ------- ------- --------
6,491 6,511 (2,139) 10,863
-------- ------- ------- --------
LOSS BEFORE TAXES AND
DISCONTINUED OPERATIONS . . . . . . . . . . . . . . . . (8,682) (282) 2,856 (6,108)
PROVISION FOR INCOME TAXES . . . . . . . . . . . . . . . - 5 - 5
-------- ------- ------- --------
(LOSS) FROM CONTINUING
OPERATIONS . . . . . . . . . . . . . . . . . . . . . . (8,682) (287) 2,856 (6,113)
======== ======= ======= ========
(LOSS) PER SHARE FROM
CONTINUING OPERATIONS . . . . . . . . . . . . . . . . . ($0.57) ($0.21)
======== ========
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING . . . . . . . . . . . . . . . . . . 15,153 13,874 (4) 29,027
======== ======= ========
See Accompanying Notes to Unaudited Pro Forma Combined Condensed Financial Statements.
</TABLE>
<PAGE> 5
NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
NOTE A - DESCRIPTION OF ACQUISITION:
Westwood One entered into the Acquisition to purchase the Unistar
Shares for $16.6 million. In addition, the Company assumed and repaid the
Retained Debt of $84.7 million. Westwood One purchased the Unistar Shares less
the Assigned Assets and the Assumed Liabilities. In addition, INI, a
subsidiary of Infinity, purchased 5,000,000 shares of Common Stock for an
aggregate purchase price of $15 million and received a ten-year warrant to
purchase 3,000,000 shares of Common Stock, which will vest over three years, at
$3.00 per share.
NOTE B - BASIS OF PRESENTATION:
The unaudited pro forma combined condensed balance sheet at November 30,
1993 includes the balance sheet of Westwood One at November 30, 1993 and
Unistar at December 31, 1993.
The pro forma combined condensed statement of operations for the year
ended November 30, 1993 includes the results of operations of Westwood One for
the year ended November 30, 1993 and the results of operations of Unistar for
the year ended December 31, 1993.
NOTE C - PRO FORMA ADJUSTMENTS FOR UNAUDITED PRO FORMA COMBINED
CONDENSED BALANCE SHEET (in 000's except share amounts):
Amounts in parentheses represent adjustments decreasing historical
balances.
The summary recap below reconciles Unistar's historical December 31, 1993
balance sheet to the preliminary fair values reflected for Unistar assets and
liabilities acquired, after the allocation of the $16,589 Acquisition of the
Unistar Shares plus $3,500 estimated costs of the Acquisition, aggregating
$20,089. During fiscal 1994, WWO will make its final allocation of the
aggregate consideration paid in connection with the Acquistion. Therefore, the
preliminary allocation reflected below (and the related amortization expense in
the Unaudited Pro Forma Combined Condensed Statement of Operations) may differ
from the amounts and asset categories ultimately determined.
<TABLE>
<CAPTION>
Historical Preliminary
Basis of Fair Value of
Assets and Assets and
Historical Liabilities Liabilities
Unistar Pro Forma Acquired Pro Forma Acquired
Balance Adjustment #1 from Adjustment #2 from
Sheet Below Unistar Below Unistar
--------- --------- -------- ----------- ---------
<S> <C> <C> <C> <C> <C>
Current assets . . . . . . . . . . . . . . $ 19,027 ($18,310) $ 717 - $ 717
Property and equipment . . . . . . . . . . 3,397 - 3,397 - 3,397
Intangible assets (station
affiliation agreements
acquired) . . . . . . . . . . . . . . . - - - $15,000 15,000
Intangible assets (goodwill) . . . . . . . 101,409 (20,812) 80,597 5,089 85,686
-------- -------- ------- ------- --------
Total assets . . . . . . . . . . . . . $123,833 ($39,122) $84,711 $20,089 $104,800
======== ======== ======= ======= ========
Current liabilities . . . . . . . . . . . $ 20,951 ($20,951) - - -
Long-term debt . . . . . . . . . . . . . . 103,169 (18,458) $84,711 - $ 84,711
Shareholders' equity . . . . . . . . . . . (287) 287 - - -
-------- -------- ------- ------- --------
Total liabilities and shareholders' equity $123,833 ($39,122) $84,711 - $ 84,711
======== ======== ======= ======= ========
</TABLE>
<PAGE> 6
1. To record, prior to Closing, Unistar's distribution to UCGI of the
historical Unistar Assigned Assets and Assumed Liabilities. To eliminate
historical Unistar stockholder's deficiency.
<TABLE>
<S> <C>
Current assets (excluding prepaid expenses) . . . . . . . . . . . . . . . . . . . . . . . . . . ($18,310)
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (20,951)
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (18,458)
Shareholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 287
--------
Intangible assets (adjustment of goodwill) . . . . . . . . . . . . . . . . . . . . . . . . . . . ($20,812)
========
</TABLE>
2. To reflect and allocate the cash purchase price of the acquired assets
and liabilities based upon preliminary estimated fair values of the acquired
pool of station affiliation agreements based upon management's experience in
valuing a similar asset pool acquired as part of prior purchases of radio
networks.
<TABLE>
<S> <C>
Intangible assets (preliminary value of station affiliation agreements acquired) . . . . . . . . $15,000
Intangible assets (goodwill) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,089
--------
Current assets (cash purchase price for Unistar Shares plus estimated costs of Acquisition) . . $20,089
=======
</TABLE>
3. To record maximum borrowings on the New Senior Loan:
<TABLE>
<S> <C>
Current assets (cash) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $125,000
========
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $125,000
========
</TABLE>
4. To reflect the sale of the 5,000,000 Westwood One Shares to INI.
<TABLE>
<S> <C>
Current assets (cash) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $15,000
=======
Shareholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $15,000
=======
</TABLE>
5. To reflect the payment of costs related to obtaining the New Senior
Loan and repayment of the Retained Debt and certain Westwood One debt.
<TABLE>
<S> <C>
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ($90,153)
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8,206)
Other assets (estimated costs of obtaining New Senior Loan) . . . . . . . . . . . . . . . . . . 2,500
---------
Current assets (cash) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ($100,859)
=========
</TABLE>
Pro Forma Combined Long-term debt includes the New Senior Loan of $125,000 and
the 6 3/4% Debentures of $15,443 (a total of $140,443).
6. To reflect, as of November 30, 1993, the assumed conversion of the 9%
Debentures to Common Stock (the anticipated issuance of additional shares upon
conversion will occur subsequent to the Acquisition in connection with WWO's
redemption of the 9% Debentures).
<TABLE>
<S> <C>
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ($31,058)
========
Shareholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $31,058
========
</TABLE>
7. To record the estimated fair market value of 1,500,000 Incentive
Warrants issued to INI in connection with the Management Agreement.
<TABLE>
<S> <C>
Other assets (deferred compensation) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,000
======
Shareholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,000
======
</TABLE>
8. To conform Unistar's classification of intangible assets with WWO
presentation.
<TABLE>
<S> <C>
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $101,409
=========
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ($101,409)
=========
</TABLE>
<PAGE> 7
NOTE D -- PRO FORMA ADJUSTMENTS FOR UNAUDITED PRO FORMA COMBINED
CONDENSED STATEMENTS OF OPERATIONS (IN 000'S, EXCEPT SHARE AMOUNTS):
1. To adjust amortization (i) to conform Unistar's amortization period for
goodwill to the 40 year period used by Westwood One and (ii) to amortize the
value assigned to Unistar station affiliation agreements acquired in the
preliminary purchase price allocation. The Unistar station affiliation
agreements acquired are amortized over their useful life (approximately forty
years) on an accelerated method which approximates the rate at which stations
are projected to terminate their affiliation to the network.
2. To record and adjust for the Management Agreement:
<TABLE>
<S> <C>
Base management fee due Infinity in connection with the Management
Agreement........................................................ $ 2,000
Elimination of fees associated with Unistar management agreement
and compensation and related benefits for certain management of
Unistar and Westwood One (Chief Financial Officer) which would
not have been incurred had the Management Agreement been in
effect........................................................... (2,070)
Compensation expense related to the 1,500,000 Incentive Warrants
issued in connection with the Management Agreement at various
prices........................................................... 200
Estimated reimbursable out-of-pocket expenses expected to be
incurred by Infinity in connection with the Management
Agreement........................................................ 100
--------
Total adjustment to operating costs and expenses......... $ 230
========
</TABLE>
3. To adjust historical interest expense for outstanding debt consisting of
the $125 million New Senior Loan (7 1/2% interest rate) and the 6 3/4%
Debentures. Interest expense will increase or decrease by $156 for every 1/8%
change in the assumed interest rate. The adjustment also includes straight-line
amortization, over an assumed eight year period, of deferred costs of obtaining
the New Senior Loan. The components of the adjustment are set forth below:
<TABLE>
<S> <C>
Interest and deferred debt cost amortization relating to the New
Senior Loan...................................................... $ 9,688
Elimination of interest and deferred debt cost amortization
relating to Unistar's Retained Debt and Westwood One's 9%
Debentures and certain other debt................................ (11,827)
--------
Total adjustment to interest expense..................... $ (2,139)
========
</TABLE>
4. To adjust weighted average number of shares outstanding to reflect the
sale of the 5,000,000 Westwood One Shares to INI and the conversion to Common
Stock of the 9% Debentures (the assumed conversion will occur subsequent to the
Closing in connection with Westwood One's redemption of its 9% Debentures).
5. No adjustment reflecting potential cost reductions which may occur as a
result of the Proposed Transaction has been made. Preliminary estimates indicate
a potential annual savings of $3,000 to $5,000 (including the eventual
elimination of any duplicate facilities, although none have yet been
specifically identified). However, no assurance can be given that such savings
will be realized.
