SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 2, 1996
Osborn Communications Corporation
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
0-16841 06-1142367
(Commission File Number) (IRS Employer Identification No.)
130 Mason Street, Greenwich, Connecticut 06830
(Address of principal executive office) (Zip Code)
Registrant's telephone number including area code: (203) 629-0905
(Former name or former address, if changed since last report)
<PAGE>
Item 2. Acquisition or Disposition of Assets.
On February 2, 1996, the Registrant sold substantially all the assets of
radio stations WNTQ-FM/WNDR-AM, Syracuse, New York to Pilot Communications
L.L.C. for $12.5 million. The net proceeds were used to repay a portion of
the Registrant's long-term debt.
Item 5. Other Events.
On December 21, 1995, the Registrant entered into an option agreement with
Allbritton Communications Company ("Allbritton") for the sale of television
station WJSU-TV, Anniston, Alabama. Under the terms of the option agreement,
the Registrant received $10 million for an option which gives Allbritton the
right to purchase substantially all the assets relating to the operations of
the station for $2 million. In addition, the Registrant will receive up to
$7 million upon receipt of the necessary approvals to relocate the station's
broadcast transmitter to maximize broadcast coverage of the facility.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired.
Not applicable
(b) Pro forma financial information.
(1) Pro Forma Condensed Consolidated Balance Sheet (Unaudited) as of
September 30, 1995
(2) Pro Forma Condensed Consolidated Statement of Operations (Unaudited)
for the year ended December 31, 1994
(3) Pro Forma Condensed Consolidated Statement of Operations (Unaudited)
for the nine months ended September 30, 1995
(4) Notes to Unaudited Pro Forma Financial Statements
(c) Exhibits.
The Asset Purchase Agreement between Pilot Communications of Syracuse, Inc.
and Orange Communications, Inc. dated as of September 18, 1995, previously
filed as Exhibit (a) to the Registrant's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1995 is incorporated herein by reference.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
OSBORN COMMUNICATIONS CORPORATION
(Registrant)
Date: February 16, 1996 /s/ Thomas S. Douglas
(Signature)
Thomas S. Douglas
Senior Vice President and Treasurer
<PAGE>
PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
On February 2, 1996, the Registrant sold substantially all the assets of
radio stations WNTQ-FM/WNDR-AM, Syracuse, New York to Pilot Communications
L.L.C. for $12.5 million (the "Syracuse Disposition"). The net proceeds
were used to repay a portion of the Registrant's long-term debt.
On December 21, 1995, the Registrant entered into an option agreement with
Allbritton Communications Company ("Allbritton") for the sale of television
station WJSU-TV, Anniston, Alabama (the "Anniston Option"). Under the terms
of the option agreement, the Registrant received $10 million for an option
which gives Allbritton the right to purchase substantially all the assets
relating to the operations of the station for $2 million. In addition, the
Registrant will receive up to $7 million upon receipt of the the necessary
approvals to relocate the station's broadcast transmitter to maximize
broadcast coverage of the facility. The net proceeds were used to repay a
portion of the Registrant's long-term debt.
The Heritage Acquisition consists of the purchase from Heritage Broadcast
Group, Inc. ("Heritage") in June 1994 of substantially all the assets of
radio stations WWNC-AM/WKSF-FM, Asheville, North Carolina; WOLZ-FM, Ft.
Myers, Florida; and WFKS-FM, Daytona Beach/Palatka, Florida for $20.0 million
plus transaction costs and the purchase from Heritage in August 1994 of
substantially all the assets of radio stations WAAX-AM/WQEN-FM, Gadsden,
Alabama for $1.75 million plus transaction costs.
The Atlantic City Acquisition consists of the purchase from Radio WAYV, Inc.
in March 1994 of substantially all the assets of radio station WAYV-FM,
Atlantic City, New Jersey for consideration of approximately $2.5 million.
The CMIF Refinancing consists of the issuance of notes payable totalling
$50.0 million to World Subordinated Debt Partners, L.P., an affiliate of
Citicorp Mezzanine Investment Fund ("CMIF"). The proceeds were used to fund
the Heritage Acquisition, repay the Registrant's existing long-term debt and
for general corporate purposes.
The accompanying pro forma condensed consolidated balance sheet at September
30, 1995 assumes that the Syracuse Disposition and Anniston Option were made
as of September 30, 1995. The accompanying pro forma condensed consolidated
statements of operations for the year ended December 31, 1994 assumes that
the Syracuse Disposition, Anniston Option, Atlantic City Acquisition,
Heritage Acquisition and CMIF Refinancing occurred as of January 1, 1994.
The accompanying pro forma condensed consolidated statements of operations for
the nine months ended September 30, 1995 assumes that the Syracuse Disposition
and Anniston Option were made as of January 1, 1995. The pretax gains
resulting from the Syracuse Disposition and Anniston Option are not reflected
in the accompanying pro forma condensed consolidated statements of operations.
In management's opinion, the accompanying pro forma financial information is
not necessarily indicative of either future results of operations or the
results that might have occurred if the foregoing transactions had been
consummated on the indicated dates.
<PAGE>
<TABLE>
OSBORN COMMUNICATIONS CORPORATION
UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
September 30, 1995
<S> <C> <C> <C> <C>
Syracuse Pro Forma
Historical Disposition Adjustments Pro Forma
ASSETS
Cash and cash equivalents $2,181,164 $2,181,164
Other current assets 8,041,672 (856,267) 7,185,405
Total current assets 10,222,836 (856,267) 9,366,569
Investment in affiliated
companies 530,640 530,640
Property, plant and
equipment, net 15,487,820 (911,104) 14,576,716
Intangible assets, net 41,423,105 (4,327,568) 37,095,537
Other noncurrent assets 124,561 124,561
Total assets $67,788,962 ($6,094,939) $61,694,023
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $7,015,072 $7,015,072
Long-term debt 44,500,000 (21,000,000)(a) 23,500,000
Deferred income taxes 2,185,047 2,185,047
Other noncurrent
liabilities 280,927 280,927
Total liabilities 53,981,046 - 32,981,046
Common stock 52,764 52,764
Additional paid-in
capital 39,694,601 39,694,601
Accumulated deficit (25,939,449) (6,094,939) 21,000,000(a) (11,034,388)
Total stockholders'
equity 13,807,916 (6,094,939) 28,712,977
Total liabilities
and stockholders'
equity $67,788,962 ($6,094,939) $61,694,023
</TABLE>
See accompanying Notes to Unaudited Pro Forma Financial Statements
<PAGE>
OSBORN COMMUNICATIONS CORPORATION
UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
for the year ended December 31, 1994
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Atlantic City
Syracuse Anniston and Heritage Pro Forma
Historical Disposition Option Acquisitions Adjustments Pro Forma
Net revenues $34,581,651 ($3,418,107) (3,863,331) $3,576,832 $30,877,045
Operating
expenses
excluding
depreciation,
amortization
and
corporate
expenses 25,505,886 (2,284,078) (2,550,281) 2,708,898 23,380,425
Depreciation
and amortization 5,285,280 (321,713) (454,552) 428,000 4,937,015
Corporate
expenses 2,475,675 (22,227) - - 2,453,448
Operating income 1,314,810 (790,089) (858,498) 439,934 106,157
Other income 2,246,450 3,707 (4,585) 2,747 2,248,319
Interest expense 4,385,827 - - - (555,007)(b) 3,830,820
Income (loss)
before income
taxes (824,567) (786,382) (863,083) 442,681 (1,476,344)
Provision for
income taxes 289,220 - - - (25,000)(c) 264,220
Net income (loss)
before
extraordinary
items ($1,113,787) ($786,382) ($863,083) $442,681 ($1,740,564)
</TABLE>
See accompanying Notes to Unaudited Pro Forma Financial Statements
<PAGE>
OSBORN COMMUNICATIONS CORPORATION
UNAUDITED PRO FORMA CONDENSED STATEMENT OF OPERATIONS
for the nine months ended September 30, 1995
<TABLE>
<S> <C> <C> <C> <C> <C>
Syracuse Anniston Pro Forma
Historical Disposition Option Adjustments Pro Forma
Net revenues $28,802,257 ($2,341,721) (2,626,295) $23,834,241
Operating
expenses
excluding
depreciation,
amortization and
corporate
expenses 21,810,210 (1,673,855) (1,890,298) 18,246,057
Depreciation and
amortization 4,315,622 (218,000) (243,000) 3,854,622
Corporate expenses 1,276,051 (587) - 1,275,464
Operating income 1,400,374 (449,279) (492,997) 458,098
Other income
(expense) 1,975,009 (100) (5,184) 1,969,725
Interest expense 4,137,330 - - (1,660,913)(d) 2,476,417
Equity in loss of
affiliated company (5,273) - - (5,273)
Income (loss) before
income taxes (767,220) (449,379) (498,181) (53,867)
Provision for
income taxes 298,154 - - (25,000)(c) 273,154
Net income (loss)
before
extraordinary
items ($1,065,374) ($449,379) ($498,181) ($327,021)
</TABLE>
See accompanying Notes to Unaudited Pro Forma Financial Statements
<PAGE>
Notes to Unaudited Pro Forma Financial Data
(a) Represents repayment of long-term debt with the net proceeds of the
Syracuse Disposition and Anniston Option.
(b) Represents the reduction of interest expense resulting from the CMIF
Refinancing, Heritage Acquisition and Atlantic City Acquisition, net of
the repayment of long-term debt with the proceeds from the Syracuse
Disposition and Anniston Option.
(c) Represents reduction of state and local income taxes resulting from the
Syracuse Disposition.
(d) Represents reduction of interest expense resulting from the repayment of
long-term debt with the net proceeds from the Syracuse Disposition and
Anniston Option.
