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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 2004 Commission file number 000-22486
AMFM OPERATING INC.
(AN INDIRECT, WHOLLY-OWNED SUBSIDIARY OF
CLEAR CHANNEL COMMUNICATIONS, INC.)
(Exact name of registrant as specified in its charter)
DELAWARE 13-3649750
(State of Incorporation) (I.R.S. Employer Identification No.)
200 EAST BASSE ROAD
SAN ANTONIO, TEXAS 78209
(210) 822-2828
(Address and telephone number
of principal executive offices)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for 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[ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2). Yes [ ] No [X]
Indicate the number of shares outstanding of each class of the issuer's
classes of common stock, as of the latest practicable date: As of May 14, 2004,
1,040 shares of the Registrant's common stock were outstanding.
The registrant meets the conditions set forth in General Instruction
H(1)(a) and (b) of Form 10-Q and is therefore filing this report with the
reduced disclosure format.
TABLE OF CONTENTS
Page No.
--------
Part I -- Financial Information
Item 1. Unaudited Financial Statements
Consolidated Balance Sheets at March 31, 2004 and December 31, 2003 3
Consolidated Statements of Operations for the three months ended March 31, 2004 and 2003 5
Consolidated Statements of Cash Flows for the three months ended March 31, 2004 and 2003 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 11
Item 4. Controls and Procedures 12
Part II -- Other Information
Item 1 Legal Proceedings 13
Item 5. Other Information 13
Item 6. Exhibits and Reports on Form 8-K 13
(a) Exhibits
(b) Reports on Form 8-K
Signatures 13
Index to Exhibits 14
PART I
ITEM 1. UNAUDITED FINANCIAL STATEMENTS
AMFM OPERATING INC. AND SUBSIDIARIES
(an indirect, wholly-owned subsidiary of Clear Channel Communications, Inc.)
CONSOLIDATED BALANCE SHEETS
ASSETS
(In thousands)
March 31, December 31,
2004 2003
(Unaudited) (Audited)
------------ ------------
Current Assets
Accounts receivable, less allowance of $13,561 at
March 31, 2004 and $12,795 at December 31, 2003 $ 360,670 $ 425,479
Other current assets 18,060 21,012
------------ ------------
Total Current Assets 378,730 446,491
Property, Plant and Equipment
Land, buildings and improvements 189,668 189,393
Transmitter and studio equipment 283,528 283,151
Furniture and other equipment 118,389 116,439
Construction in progress 19,001 18,721
------------ ------------
610,586 607,704
Less accumulated depreciation (163,871) (151,821)
------------ ------------
446,715 455,883
Intangible Assets
Definite-lived intangibles, net 179,004 176,309
Indefinite-lived intangibles - licenses 7,335,274 7,332,941
Goodwill 2,797,186 2,794,642
Other Assets
Other assets 42,950 41,935
Other investments 84 84
------------ ------------
Total Assets $ 11,179,943 $ 11,248,285
------------ ------------
See Notes to Consolidated Financial Statements
3
AMFM OPERATING INC. AND SUBSIDIARIES
(an indirect, wholly-owned subsidiary of Clear Channel Communications, Inc.)
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDER'S EQUITY
(In thousands)
March 31, December 31,
2004 2003
(Unaudited) (Audited)
------------ ------------
Current Liabilities
Accounts payable $ 25,853 $ 29,882
Accrued interest 22,228 8,802
Accrued expenses 76,755 76,141
------------ ------------
Total Current Liabilities 124,836 114,825
Long-term debt 687,335 688,064
Clear Channel promissory note 300,000 300,000
Deferred income taxes 1,922,977 1,892,741
Other long-term liabilities 198,131 198,523
Shareholder's Equity
Common stock 1 1
Additional paid-in capital 17,346,238 17,346,238
Retained deficit (9,399,575) (9,292,107)
------------ ------------
Total Shareholder's Equity 7,946,664 8,054,132
------------ ------------
Total Liabilities and Shareholder's Equity $ 11,179,943 $ 11,248,285
------------ ------------
See Notes to Consolidated Financial Statements
4
AMFM OPERATING INC. AND SUBSIDIARIES
(an indirect, wholly-owned subsidiary of Clear Channel Communications, Inc.)
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(In thousands)
Three Months Ended
March 31,
------------------------
2004 2003
---- ----
Revenue $ 462,733 $ 438,458
Operating expenses:
Divisional operating expenses (excludes non-cash compensation expenses of
$261 and $516 for the three months ended March 31,
2004 and 2003, respectively) 266,494 253,346
Non-cash compensation expense 261 516
Depreciation and amortization 20,331 17,236
Corporate expenses 16,770 14,236
--------- ---------
Operating income 158,877 153,124
Interest expense 16,003 25,985
Other income (expense) - net 797 2,518
--------- ---------
Income before income taxes 143,671 129,657
Income tax (expense) benefit (58,187) (52,511)
--------- ---------
Net income 85,484 77,146
Other comprehensive income (loss), net of tax -- --
--------- ---------
Comprehensive income $ 85,484 $ 77,146
--------- ---------
See Notes to Consolidated Financial Statements
5
AMFM OPERATING INC. AND SUBSIDIARIES
(an indirect, wholly-owned subsidiary of Clear Channel Communications, Inc.)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)
Three Months Ended March 31,
----------------------------
2004 2003
---- ----
NET CASH PROVIDED BY OPERATING ACTIVITIES $ 213,565 $ 191,776
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment (6,775) (7,127)
Proceeds from disposal of assets 1,673 179
Acquisitions of operating assets (15,511) (3,291)
--------- ---------
Net cash (used in) investing activities (20,613) (10,239)
CASH FLOWS FROM FINANCING ACTIVITIES:
(Payments on) proceeds from Clear Channel promissory
note, net -- 390,997
Payments on long-term debt -- (572,534)
Dividends paid to Clear Channel (192,952) --
--------- ---------
Net cash (used in) financing activities (192,952) (181,537)
Increase (decrease) in cash and cash equivalents -- --
Cash and cash equivalents at beginning of period -- --
--------- ---------
Cash and cash equivalents at end of period $ -- $ --
--------- ---------
See Notes to Consolidated Financial Statements
6
AMFM OPERATING INC. AND SUBSIDIARIES
(an indirect, wholly-owned subsidiary of Clear Channel Communications, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Preparation of Interim Financial Statements
AMFM Operating Inc. (the "Company"), together with its subsidiaries, is an
indirect, wholly-owned subsidiary of Clear Channel Communications, Inc. ("Clear
Channel"), a diversified media company with operations in radio broadcasting,
outdoor advertising and live entertainment.
The consolidated financial statements have been prepared by the Company pursuant
to the rules and regulations of the Securities and Exchange Commission ("SEC")
and, in the opinion of management, include all adjustments (consisting of normal
recurring accruals and adjustments necessary for adoption of new accounting
standards) necessary to present fairly the results of the interim periods shown.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such SEC rules and regulations.
Management believes that the disclosures made are adequate to make the
information presented not misleading. Due to seasonality and other factors, the
results for the interim periods are not necessarily indicative of results for
the full year. The financial statements contained herein should be read in
conjunction with the consolidated financial statements and notes thereto
included in the Company's 2003 Annual Report on Form 10-K.
The consolidated financial statements include the accounts of the Company and
its subsidiaries, the majority of which are wholly-owned. All significant
intercompany transactions are eliminated in the consolidation process. Certain
reclassifications have been made to the 2003 consolidated financial statements
to conform to the 2004 presentation.
Stock-Based Compensation
The Company's employees are periodically awarded stock options to acquire stock
of Clear Channel. The Company accounts for these stock-based awards in
accordance with Accounting Principles Board ("APB") Opinion No. 25, "Accounting
for Stock Issued to Employees", and related interpretations, under which
compensation expense is recorded to the extent that the market price on the
grant date of the underlying stock exceeds the exercise price. The required pro
forma net income as if the stock-based awards had been accounted for using the
provisions of Statement of Financial Accounting Standards No. 123, "Accounting
for Stock-Based Compensation", are as follows:
Three Months Ended
March 31,
------------------
(In thousands) 2004 2003
- -------------- ---- ----
Net Income
Reported $ 85,484 $ 77,146
Pro forma stock compensation expense, net of tax 1,230 836
-------- --------
Pro Forma $ 84,254 $ 76,310
-------- --------
The fair value for these options was estimated at the date of grant using a
Black-Scholes option-pricing model with the following assumptions for 2004 and
2003:
2004 2003
---- ----
Risk-free interest rate 2.21% 2.91% - 3.76%
Dividend yield .90% 0%
Volatility factors 50% 43% - 47%
Expected life in years 3.0 5.0 - 7.5
7
Recent Accounting Pronouncements
On January 1, 2004, the Company adopted Financial Accounting Standards Board
Interpretation No. 46, "Consolidation of Variable Interest Entities" ("FIN 46").
The Interpretation addresses consolidation of business enterprises of variable
interest. The adoption of FIN 46 did not have a material impact on the Company's
financial position or results of operations.
Note 2: INTANGIBLE ASSETS AND GOODWILL
Definite-lived Intangibles
The Company's definite-lived intangibles consist of representation contracts for
non-affiliated television and radio stations. These agreements are amortized
over their respective lives.
Total amortization expense from representation contracts for the three months
ended March 31, 2004 and for the year ended December 31, 2003 was $6.2 million
and $25.0 million, respectively. The gross carrying value of the contracts at
March 31, 2004 was $248.7 million and accumulated amortization was $69.7
million. The gross carrying value of the contracts at December 31, 2003 was
$239.8 million and accumulated amortization was $63.5 million. The following
table presents the Company's estimate of amortization expense for each of the
five succeeding fiscal years for definite-lived intangible assets:
(In thousands)
--------------
2005 $ 26,796
2006 21,794
2007 15,019
2008 13,640
2009 12,178
Indefinite-lived Intangibles
The Company's indefinite-lived intangible assets consist of FCC broadcast
licenses. FCC broadcast licenses are granted to radio stations for up to eight
years under the Telecommunications Act of 1996. The Act requires the FCC to
renew a broadcast license if: it finds that the station has served the public
interest, convenience and necessity; there have been no serious violations of
either the Communications Act of 1934 or the FCC's rules and regulations by the
licensee; and there have been no other serious violations which taken together
constitute a pattern of abuse. The licenses may be renewed indefinitely at
little or no cost. The Company does not believe that the technology of wireless
broadcasting will be replaced in the foreseeable future.
In accordance with Statement of Financial Accounting Standards No. 142,
"Goodwill and Other Intangible Assets" ("Statement 142"), the Company does not
amortize its FCC licenses. The Company tests its FCC licenses for impairment at
least annually. The Company generally uses an income approach to value FCC
licenses, which involves estimating expected future cash flows from the
licenses, discounted to their present value using a risk-adjusted discount rate.
Terminal values were also estimated and discounted to their present value. The
Company performed impairment tests at October 1, 2003 and 2002, which resulted
in no impairment charge.
Goodwill
Statement 142 requires the Company to test goodwill for impairment using a
two-step process. The first step, used to screen for potential impairment,
compares the fair value of the reporting unit with its carrying amount,
including goodwill. The second step, used to measure the amount of the
impairment loss, compares the implied fair value of the reporting unit goodwill
with the carrying amount of that goodwill. The Company completed the two-step
impairment test at October 1, 2003 and 2002, which resulted in no impairment
charge. Consistent with the Company' approach to fair valuing FCC licenses, an
income approach was used to determine the fair value of each of the Company's
reporting units. The following table presents the changes in the carrying amount
of goodwill for the three months ended March 31, 2004:
(In thousands)
--------------
Balance at January 1, 2004 $ 2,794,642
Acquisitions 2,544
-----------
Balance at March 31, 2004 $ 2,797,186
-----------
8
Note 3: RESTRUCTURING
The Company has recorded a liability in purchase accounting from its merger with
Clear Channel in 2000 ("AMFM Merger"), that relates to severance for terminated
employees and lease terminations as follows:
Three Months Ended Year Ended
(In thousands) March 31, 2004 December 31, 2003
- -------------- -------------- -----------------
Severance and lease termination costs:
Accrual at January 1 $ 26,516 $ 29,450
Payments charged against restructuring accrual (143) (2,934)
-------- --------
Remaining severance and lease termination accrual $ 26,373 $ 26,516
-------- --------
The remaining severance and lease accrual at March 31, 2004 is comprised of
$19.9 million of severance and $6.5 million of lease termination obligations.
The severance accrual will be paid over the next several years. The lease
termination accrual will be paid over the next four years. As the Company made
adjustments to finalize the purchase price allocation related to the AMFM Merger
during 2001, any potential excess reserves will be recorded as an adjustment to
the purchase price.
Note 4: CLEAR CHANNEL PROMISSORY NOTE AND LONG-TERM DEBT
Clear Channel Promissory Note
The promissory note bears interest at 7% per annum. Accrued interest plus the
note balance is payable on August 30, 2010 or upon demand. The Company is
entitled to borrow additional funds and to repay outstanding borrowings, subject
to the terms of the promissory note. Clear Channel currently has no intention of
demanding payment on this note prior to its maturity.
8% Senior Notes
On November 17, 1998, the Company issued $750.0 million aggregate principal
amount of 8% senior notes due 2008 (the "8% senior notes"). Interest on the 8%
senior notes is payable semiannually, commencing on May 1, 1999. The 8% senior
notes mature on November 1, 2008 and are redeemable, in whole or in part, at the
option of the Company at a redemption price equal to 100% plus the applicable
premium (as defined in the indenture governing the 8% senior notes) plus accrued
and unpaid interest. Upon the occurrence of a change in control (as defined in
the indenture governing the 8% senior notes), the holders of the notes have the
right to require the Company to repurchase all or any part of the notes at a
purchase price equal to 101% plus accrued and unpaid interest.
The 8% senior notes are senior unsecured obligations of the Company and rank
equal in right of payment to the obligations of the Company and all other
indebtedness of the Company not expressly subordinated to the 8% senior notes.
The 8% senior notes are fully and unconditionally guaranteed, on a joint and
several basis, by all of the Company's direct and indirect subsidiaries.
The 8% senior notes contain customary restrictive covenants, which, among other
things and with certain exceptions, limit the ability of the Company to incur
additional indebtedness and liens in connection therewith, enter into certain
transactions with affiliates, pay dividends, consolidate, merge or effect
certain asset sales, issue additional stock, effect an asset swap and make
acquisitions. Under the 8% senior notes, the Clear Channel dividend is
considered a restricted payment. At March 31, 2004, the Company had paid Clear
Channel a $193.0 million dividend and had approximately $7.7 billion available
for restricted payments.
The balance of the 8% senior notes include $16.0 million and $16.8 million as of
March 31, 2004 and December 31, 2003, respectively, in unamortized fair value
purchase accounting adjustments related to the merger with Clear Channel. The
fair value of the 8% senior notes was $791.4 million and $780.9 million at March
31, 2004 and December 31, 2003, respectively.
Other
At March 31, 2004, the Company was in compliance with all debt covenants. The
Company expects to be in compliance throughout 2004.
9
Note 5: COMMITMENTS, CONTINGENCIES AND GUARANTEES
The Company has guaranteed a portion of Clear Channel's bank credit facilities
including a reducing revolving line of credit facility and a $1.5 billion
five-year multi-currency revolving credit facility with outstanding balances at
March 31, 2004 of $417.0 million and $-0-, respectively. At March 31, 2004 the
contingent liability under these guarantees was $1.0 billion.
From time to time, claims are made and lawsuits are filed against the Company,
arising out of the ordinary business of the Company. In the opinion of the
Company's management, liabilities, if any, arising from these actions are either
covered by insurance or accrued reserves, or would not have a material adverse
effect on the financial condition of the Company.
Note 6: SEGMENT DATA
The Company has one reportable operating segment - radio broadcasting. The
Company's media representation firm is reported in "other". Revenue and expenses
earned and charged between segments are recorded at fair value and eliminated in
consolidation.
Radio
(In thousands) Broadcasting Other Corporate Eliminations Consolidated
- -------------- ------------ ----- --------- ------------ ------------
Three months ended March 31, 2004
Revenue $ 426,082 $ 43,508 $ -- $ (6,857) $ 462,733
Divisional operating expenses 231,528 41,823 -- (6,857) 266,494
Non-cash compensation 261 -- -- -- 261
Depreciation and amortization 12,301 7,627 403 -- 20,331
Corporate expenses -- -- 16,770 -- 16,770
------------ --------- --------- -------- ------------
Operating income (loss) $ 181,992 $ (5,942) $ (17,173) $ -- $ 158,877
------------ --------- --------- -------- ------------
Intersegment revenues $ -- $ 6,857 $ -- $ -- $ 6,857
Identifiable assets $ 10,868,016 $ 241,931 $ 69,996 $ -- $ 11,179,943
Three months ended March 31, 2003
Revenue $ 401,458 $ 42,891 $ -- $ (5,891) $ 438,458
Divisional operating expenses 220,952 38,285 -- (5,891) 253,346
Non-cash compensation 516 -- -- -- 516
Depreciation and amortization 9,395 7,164 677 -- 17,236
Corporate expenses -- -- 14,236 -- 14,236
------------ --------- --------- -------- ------------
Operating income (loss) $ 170,595 $ (2,558) $ (14,913) $ -- $ 153,124
------------ --------- --------- -------- ------------
Intersegment revenues $ -- $ 5,891 $ -- $ -- $ 5,891
Identifiable assets $ 10,891,897 $ 232,862 $ 79,331 $ -- $ 11,204,090
10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
(Abbreviated pursuant to General Instruction H(2)(a) of Form 10-Q)
RESULTS OF OPERATIONS
Comparison of Three Months Ended March 31, 2004 to Three Months Ended March 31,
2003 is as follows:
CONSOLIDATED
Three Months Ended
(In thousands) March 31, %
----------------------
2004 2003 Change
---- ---- ------
Revenue $ 462,733 $ 438,458 6%
Divisional operating expenses 266,494 253,346 5%
Revenue grew 6% for the three months ended March 31, 2004 as compared
to 2003. Revenue growth was lead primarily by resurgent local advertising with
growth in network revenue primarily from the Company's syndicated radio programs
and growth in traffic revenue contributing to a lesser extent. Strong local and
national advertising categories during the first quarter included services,
automotive, entertainment and consumer products.
Divisional operating expenses increased 5% for the three months ended
March 31, 2004 as compared to 2003. The increase is primarily from an increase
in programming and promotion costs.
Other Income and Expense Information
Corporate expense increased $2.5 million for the three months ended
March 31, 2004 as compared to 2003. The increase is primarily the result of a
higher bonus accrual in the current period related to our improved operating
performance.
Depreciation and amortization expense increased $3.1 million for the
three months ended March 31, 2004 as compared to 2003. The increase is the
result of fixed asset additions subsequent to the first quarter of 2003.
Interest expense decreased $10.0 million during the three months ended
March 31, 2004 as compared to 2003 due to the decrease in our total debt
outstanding. In February 2003, we redeemed all of the 8.125% notes and 8.75%
notes through borrowings on the Clear Channel Promissory note, which accrues
interest at 7% per annum.
Other income (expense) - net was income of $.8 million and $2.5 million
for the three months ended March 31, 2004 and 2003, respectively, a decrease of
$1.7 million. The income recognized in 2004 primarily relates to a gain on the
sale of representation contracts. The income recognized during 2003 related to a
$1.6 million gain on the early extinguishment of debt and a $.9 million gain on
the sale of representation contracts.
Caution Concerning Forward Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a safe
harbor for forward-looking statements made by us or on our behalf. Except for
the historical information, this report contains various forward-looking
statements which represent our expectations or beliefs concerning future events,
including the future levels of cash flow from operations. Management believes
that all statements that express expectations and projections with respect to
future matters, including the strategic fit of radio assets, expansion of market
share, and the availability of capital resources are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act. We caution
that these forward-looking statements involve a number of risks and
uncertainties and are subject to many variables which could impact our financial
performance. These statements are made on the basis of management's views and
assumptions, as of the time the statements are made, regarding future events and
business performance. There can be no assurance, however, that management's
expectations will necessarily come to pass.
11
A wide range of factors could materially affect future developments and
performance, including:
- - the impact of general economic and political conditions in the U.S.
including those resulting from recessions, political events and acts or
threats of terrorism or military conflicts;
- - the impact of the geopolitical environment;
- - our ability to integrate the operations of recently acquired companies;
- - shifts in population and other demographics;
- - industry conditions, including competition;
- - fluctuations in operating costs;
- - technological changes and innovations;
- - changes in labor conditions;
- - capital expenditure requirements;
- - the outcome of pending or future litigation;
- - legislative or regulatory requirements;
- - interest rates;
- - the effect of leverage on our financial position and earnings;
- - taxes;
- - access to capital markets; and
- - certain other factors set forth in our filings with the Securities and
Exchange Commission.
This list of factors that may affect future performance and the
accuracy of forward-looking statements are illustrative, but by no means
exhaustive. Accordingly, all forward-looking statements should be evaluated with
the understanding of their inherent uncertainty.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Omitted pursuant to General Instruction H(2)(c) of Form 10-Q.
ITEM 4. CONTROLS AND PROCEDURES
Our principal executive and financial officers have concluded, based on
their evaluation as of the end of the period covered by this Form 10-Q, that our
disclosure controls and procedures, as defined under Rule 13a-15(e) and
15d-15(e) of the Securities Exchange Act of 1934, are effective to ensure that
information we are required to disclose in the reports we file or submit under
the Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms, and include controls and
procedures designed to ensure that information we are required to disclose in
such reports is accumulated and communicated to management, including our
principal executive and financial officers, as appropriate to allow timely
decisions regarding required disclosure.
Subsequent to our evaluation, there were no significant changes in
internal controls or other factors that could significantly affect these
internal controls.
12
PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Clear Channel is among the defendants in a lawsuit filed on June 12,
2002 in the United States District Court for the Southern District of Florida by
Spanish Broadcasting System. The plaintiffs allege that Clear Channel is in
violation of Section One and Section Two of the Sherman Antitrust Act as well as
various other claims, such as unfair trade practices and defamation, among other
counts. This case was dismissed with prejudice on January 31, 2003. The
plaintiffs filed an appeal with the 11th Circuit Court of Appeals and oral
argument was held in the case in February 2004. A decision has not yet been
issued.
We are currently involved in certain legal proceedings and, as
required, have accrued our estimate of the probable costs for the resolution of
these claims. These estimates have been developed in consultation with counsel
and are based upon an analysis of potential results, assuming a combination of
litigation and settlement strategies. We believe any ultimate liability
resulting from these proceedings will not have a material adverse effect on our
results of operations, financial position or liquidity. It is possible, however,
that future results of operations for any particular period could be materially
affected by changes in our assumptions or the effectiveness of our strategies
related to these proceedings.
ITEM 5. OTHER INFORMATION
On April 30, 2004, Lowry Mays, our Chairman and Chief Executive
Officer, awoke with numbness on his left side and was admitted to the hospital
for testing. Doctors found that he had suffered a subdural hematoma. Surgery was
performed to alleviate the pressure caused by the hematoma. The surgery was
successful. His doctors expect a complete recovery.
On May 7, 2004, our Board of Directors appointed Mark P. Mays as
interim CEO, effective immediately.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits. See Exhibit Index on Page 14
(b) Reports on Form 8-K
NONE
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 thereunto duly authorized.
AMFM OPERATING INC.
May 14, 2004 /s/ RANDALL T. MAYS
----------------------------
Randall T. Mays
Executive Vice President and
Chief Financial Officer
May 14, 2004 /s/ HERBERT W. HILL, JR.
----------------------------
Herbert W. Hill, Jr.
Senior Vice President and
Chief Accounting Officer
13
INDEX TO EXHIBITS
EXHIBIT
NO. DESCRIPTION OF EXHIBIT
--- ----------------------
3.1(1) -- Amended and Restated Certificate of Incorporation of AMFM Operating Inc.
3.2(2) -- Bylaws of AMFM Operating Inc.
4.1(3) -- Certificate of Designation for 12 5/8% Series E Cumulative Exchangeable Preferred Stock of
AMFM Operating Inc.
4.2(4) -- Certificate of Amendment to Certificate of Designation for 12 5/8% Series E Cumulative
Exchangeable Preferred Stock of AMFM Operating Inc.
4.3(5) -- Indenture, dated as of June 24, 1997, governing the 8 3/4% Senior Subordinated Notes due
2007 of AMFM Operating Inc. (the "8 3/4% Notes Indenture").
4.4(6) -- First Supplemental Indenture, dated as of September 5, 1997, to the 8 3/4% Notes Indenture.
4.5(7) -- Second Supplemental Indenture, dated as of October 28, 1997, to the 8 3/4% Notes Indenture.
4.6(7) -- Third Supplemental Indenture, dated as of August 23, 1999, to the 8 3/4% Notes Indenture.
4.7(7) -- Fourth Supplemental Indenture, dated as of November 19, 1999, to the 8 3/4% Notes
Indenture.
4.8(7) -- Fifth Supplemental Indenture, dated as of January 18, 2000, to the 8 3/4% Notes Indenture.
4.9(8) -- Indenture, dated as of December 22, 1997, governing the 8 1/8% Senior Subordinated Notes
due 2007 of AMFM Operating Inc. (the "8 1/8% Notes Indenture").
4.10(7) -- First Supplemental Indenture, dated as of August 23, 1999, to the 8 1/8% Notes Indenture.
4.11(7) -- Second Supplemental Indenture, dated as of November 19, 1999, to the 8 1/8% Notes
Indenture.
4.12(7) -- Third Supplemental Indenture, dated as of January 18, 2000, to the 8 1/8% Notes Indenture.
4.13(9) -- Indenture, dated as of November 17, 1998, governing the 8% Senior Notes due 2008 of AMFM
Operating Inc. (the "8% Notes Indenture").
4.14(7) -- First Supplemental Indenture, dated as of August 23, 1999, to the 8% Notes Indenture.
4.15(7) -- Second Supplemental Indenture, dated as of November 19, 1999, to the 8% Notes Indenture.
4.16(7) -- Third Supplemental Indenture, dated as of January 18, 2000, to the 8% Notes Indenture.
4.17(10) -- Intercompany Promissory Note between AMFM Operating Inc. and Clear Channel Communications,
Inc. dated August 30, 2000.
10.1(11) -- Stock Option Grant Agreement, dated July 13, 1999, by and between AMFM Inc. and HMCo for
335,099 shares.
10.2(11) -- Stock Option Grant Agreement, dated July 13, 1999, by and between AMFM Inc. and HMCo for
634,517 shares.
14
31.1 -- Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a)
under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
31.2 -- Certification of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under
the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
32.1 -- Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2 -- Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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(1) Incorporated by reference to Exhibit 3.1 to the Quarterly Report on Form
10-Q of Capstar Communications, Inc. for the quarterly period ending June
30, 1999.
(2) Incorporated by reference to Exhibits to SFX Broadcasting, Inc.'s
Registration Statement on Form S-3, initially filed November 4, 1996, as
amended (Registration Number 333-15469).
(3) Incorporated by reference to Exhibits to the Current Report on Form 8-K of
SFX Broadcasting, Inc., filed on January 27, 1997.
(4) Incorporated by reference to Exhibits to SFX Broadcasting, Inc.'s Annual
Report on Form 10-K for the year ended December 31, 1997.
(5) Incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K
of Chancellor Broadcasting Company and Chancellor Radio Broadcasting
Company filed on July 17, 1997.
(6) Incorporated by reference to Exhibits to Chancellor Media Corporation of
Los Angeles's Registration Statement on Form S-4, initially filed on
September 26, 1997, as amended (Registration Number 333-36451).
(7) Incorporated by reference to Exhibits to the Annual Report on Form 10-K of
AMFM Inc. for the year ended December 31, 1999.
(8) Incorporated by reference to Exhibits to Chancellor Media Corporation of
Los Angeles's Registration Statement on Form S-4, initially filed on April
22, 1998, as amended (Registration Number 333-50739).
(9) Incorporated by reference to Exhibits to Chancellor Media Corporation of
Los Angeles's Registration Statement on Form S-4, initially filed on
November 9, 1998, as amended (Registration Number 333-66971).
(10) The Company has not filed long-term debt instruments where the total
amount under such instruments is less than ten percent of the total assets
of the Company and its subsidiaries on a consolidated basis. However, the
Company will furnish a copy of such instruments to the Commission upon
request.
(11) Incorporated by reference to Exhibits to Amendment No. 6 to Schedule 13D
of Thomas O. Hicks, et. al., filed on October 14, 1999.
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