WWON Westwood One, Inc. (MM)

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

þ		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2010

OR

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 001-14691

WESTWOOD ONE, INC.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)		95-3980449 (I.R.S. Employer Identification No.)

1166 Avenue of the Americas
New York, NY 10036
(212)-641-2000
(Address, including zip code, and telephone number,
including area code, of principal executive offices)

Securities Registered Pursuant to Section 12(b) of the Act:

Title of each class		Name of each exchange on which registered
Common stock, par value $0.01 per share		NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o No þ

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 (“Exchange Act”) 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 þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “accelerated filer”, “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o		Accelerated filer o		Non-accelerated filer o		Smaller reporting company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

The aggregate market value of common stock held by non-affiliates of the registrant was approximately $6,532,000 based on the last reported sales price of the registrant’s common stock on June 30, 2010 and assuming solely for the purpose of this calculation that all directors and officers of the registrant are “affiliates.” The determination of affiliate status is not necessarily a conclusive determination for other purposes.

As of March 31, 2011 22,554,991 shares (excluding treasury shares) of common stock, par value $0.01 per share, were outstanding.

 

 

TABLE OF CONTENTS

PART I

Item 1. Business

In this report, “Westwood One,” “Company,” “registrant,” “we,” “us” and “our” refer to Westwood One, Inc. All share and dollar amounts are in thousands, except where noted.

We are one of the nation’s largest radio networks, and one of the largest domestic outsourced providers of traffic reporting services, distributing content to approximately 5,000 radio stations and 182 television stations, which include stations in over 80 of the top 100 Metropolitan Statistical Area (“MSA”) markets in the U.S., and to over 450 digital outlets ( e.g. websites and mobile phones) nationally. We produce and distribute, sports, talk, music, special events, traffic, news, weather and other programming content and reach over 190 million people weekly. We exchange our content with radio and television stations for commercial airtime, which we then sell to local, regional and national advertisers. By aggregating and packaging commercial airtime across radio and television stations nationwide, we offer our advertising customers a cost effective way to reach a broad audience, as well as to target their audience on a demographic and geographic basis.

Our goal is to maximize the yield of our available commercial airtime to optimize revenue and profitability. We derive substantially all of our revenue from the sale of 60 seconds, 30 seconds, 15 seconds and 10 seconds commercial airtime to advertisers. Our advertisers who target national audiences generally find that a cost effective way to reach their target consumers is to purchase longer 30 or 60 second advertisements, which are principally broadcast in our news, talk, sports, music and entertainment related programming and content. Our advertisers who target local/regional audiences generally find that an effective method is to purchase shorter duration advertisements (15 seconds and 10 seconds), which are principally broadcast in our traffic and information related content. A particular advantage for our advertisers who purchase airtime in our traffic content is that their commercials are generally embedded in the actual traffic report. A growing number of advertisers purchase both local/regional and national airtime.

There are a variety of factors that influence our revenue on a periodic basis, including but not limited to: (1) economic conditions and the relative strength or weakness in the United States economy; (2) advertiser spending patterns, the timing of the broadcasting of our programming, principally the seasonal nature of sports programming and the perceived quality and cost-effectiveness of our programming by advertisers and affiliates; (3) advertiser demand on a local/regional or national basis for radio related advertising products; (4) increases or decreases in our portfolio of program offerings and the audiences of our programs, including changes in the demographic composition of our audience base; (5) increases or decreases in the size of our advertising sales force; and (6) competitive and alternative programs and advertising mediums.

Our commercial airtime is perishable and, accordingly, our revenue is significantly impacted by the commercial airtime available at the time we enter into an arrangement with an advertiser. Commercial airtime is sold and managed on an order-by-order basis; therefore, our ability to specifically isolate the relative historical aggregate impact of price and volume is not practical. We closely monitor advertiser commitments for the current calendar year, with particular emphasis placed on the annual upfront process, where advertisers make significant advance commitments to purchase advertising in the following year. We take the following factors, among others, into account when pricing commercial airtime: (1) the dollar value, length and breadth of the order; (2) the desired reach and audience demographic; (3) the quantity of commercial airtime available for the desired demographic requested by the advertiser for sale at the time their order is negotiated; and (4) the proximity of the date of the order placement to the desired broadcast date of the commercial airtime.

Business segments: Network Radio and Metro Traffic

We are organized into two business segments: Network Radio and Metro Traffic. Beginning with the first quarter of 2010, we changed how we evaluate segment performance and now use segment revenue and segment operating (loss) income before depreciation and amortization (“OIBDA”) as the primary measure of profit and loss for our operating segments. We have reflected this change in all periods presented in this report. We believe the presentation of OIBDA is relevant and useful for investors because it allows investors to view segment performance in a manner similar to the primary method used by our management and enhances their ability to understand our operating performance.

In Network Radio, our business strategy is focused on delivering the best sports, talk, music and entertainment programming, as well as key services, to affiliate and advertising customers. The goal of this strategy is to generate revenue by providing our customers with content and solutions that help them reach and attract their desired customers in the marketplace. To that end, the Company recently renewed or launched key programs and partnerships, including our multi-year partnership with the National Football League (NFL) to continue as its Network Radio Primetime partner, including the NFL playoffs and Super Bowl and our long-standing partnership with the NCAA to be the exclusive Network Radio provider for the NCAA Men’s Basketball Championship Tournament. We launched two new Talk radio programs: Robert Wuhl (sports) and Douglas Urbanski (traditional), a new Sports prep service and VH1 Classic Rock Nights in partnership with MTV.

Our Network Radio content covers several categories and formats, including national news, sports, music, entertainment, and talk radio. In national news and sports, we distribute nationally branded programs such as CBS Radio News, CNN Radio News, NBC Radio News, and major high-profile sporting events, including the NFL, NCAA football and basketball games and the Winter Olympic Games in 2010. Our Network business features shows that we produce with popular personalities including Dennis Miller, Dr. Oz, Charles Osgood and Billy Bush. We also broadcast signature Award shows in the music industry including the Grammy Awards and the Academy of Country Music (ACM) Awards, with whom we recently renewed our partnerships. Our music and entertainment programming includes concert broadcasts, and countdown shows, including Country Music Countdown and CMT Radio Live in partnership with MTV. Our Network Radio business nationally syndicates this proprietary and licensed content to radio stations, enabling them to meet their programming needs on a cost-effective basis. We generate revenue from the sale of 30 and 60 second commercial airtime, often embedded in our programming that we bundle and sell to advertisers who want to reach a national audience across numerous radio stations.

Our Metro Traffic business provides our local radio and television station affiliates with a cost-effective alternative to gathering and delivering their own traffic and local information reports in their marketplaces. We produce and distribute traffic and other local information reports, such as news, sports and weather, to approximately 2,250 radio stations and 182 television stations. Our Metro Traffic business generates revenue from the sale of commercial advertising inventory to advertisers with 10 and 15 second radio spots embedded within our information reports, and 30 second spots in television. Through the sale of this inventory, we offer advertisers a more efficient, broad-reaching alternative to purchasing advertising directly from individual radio and television stations.

One of our key strategies for Metro Traffic is to generate new revenue by adding new affiliates to receive our traffic, sports and news products, thereby increasing the available inventory to sell to advertisers. Recently, we added stations from Hearst Broadcasting, ESPN Radio, Salem, Carter Broadcasting, Next Media, Emmis, Univision, Citadel, and Cox. These agreements collectively represent significant inventory and audience in key markets that we believe will produce significant revenue over time. How profitable these agreements are will depend on how much the increased revenue generated by them exceeds the higher affiliate compensation expenses we will incur as a part thereof.

Competition

In the markets in which we operate, we compete for advertising revenue with other radio networks and other forms of communications media, including network and cable television, digital, print, direct response and point-of-sale (i.e., POP Radio).

Network Radio

As the radio industry has consolidated, companies owning large groups of stations have begun to create competing radio networks, which have resulted in increased competition for local, regional, national and network radio advertising expenditures. In our Network business, we compete with Clear Channel’s Premiere Radio Networks division, Citadel Media (formerly ABC Radio Networks), which recently announced it will be purchased by Cumulus Media, and Dial Global (a subsidiary of Triton Media), each of whom are examples of “radio networks”. Unlike our primary competitors, we are an independent radio network and are not affiliated with or controlled by a major media company. We market our programs to radio stations (referred to as affiliates), including to affiliates of other radio networks, that we believe will have the largest and most desirable listening audience for each of our programs. Given the breadth of our programming, we routinely have different programs airing in the same time frame on multiple stations in the same geographic market. This facilitates our having a diversified group of radio stations that carry our programming (news, sports, music, entertainment and talk) from which national advertisers and radio stations may choose. Since we produce and distribute many of the programs that we syndicate, we are able to respond more effectively to the preferences and needs of our advertisers and radio stations.

At the local radio station level, higher production and operating costs have led to increased demand for quality programming from outside sources. In addition, as the number and type of radio program formats has grown, local stations are competing for more ways to differentiate themselves and attract local audiences. In this competitive environment, we are able to provide our affiliates with quality programming that is cost effective. We do not compete with local stations directly for revenue as our advertising inventory is sold on a network basis and is usually connected to other programming.

In addition, we compete for advertising revenue with other forms of communications media, including network and cable television, digital, print and point-of-sale (i.e., POP Radio). We believe that the quality and breadth of our programming, and the strength of our affiliate relations and advertising sales forces, enable us to compete effectively with other forms of media.

Metro Traffic

There are several multi-market operations providing local radio and television programming services in various markets. We believe we are larger than the next largest provider of traffic and local information services (Clear Channel Communications). Our traffic data and information is generally considered to provide high quality, accurate information to our approximately 2,250 radio and 182 television affiliates, and our over 450 digital affiliates. We derive the substantial majority of our Metro Traffic revenue from the sale of commercial advertising inventory embedded within the traffic reports we deliver to radio and television stations (referred to as affiliates). Our advertising network of affiliates enables advertisers to purchase advertising on a local, multi-market or regional basis. Recently, there has been an increase in the volume of shorter-duration commercial inventory available to advertisers as well as an increase in the supply of local traffic information available in some markets. This is partially the result of the consolidation of the radio industry, which has created opportunities for large radio groups, such as Clear Channel Communications, CBS Radio, and some other station owners, to gather traffic information on their own. Also, the US Department of Transportation and other regional and local departments of transportation have increased their direct provision of real-time traffic and traveler information to the public free of charge. As a result, certain radio and television affiliates have elected to produce their own traffic reports using free, publicly available traffic information, and sell the advertising inventory embedded in these traffic reports on their own to local businesses.

Significant Events

More information on the matters described below can be found in Item 7 —Management’s Discussion and Analysis of Financial Condition and Results of Operations of this report.

Credit Agreement Amendments

On April 12, 2011, we entered into an amendment to our debt agreements with our lenders because our projections indicated that we would likely not attain sufficient Adjusted EBITDA (as defined in our lender agreements and also set forth below) to comply with our then existing debt leverage covenants in certain fiscal quarters of 2011. As a result of negotiations with our lenders, we entered into a waiver and fourth amendment to the Securities Purchase Agreement which resulted in our previously existing maximum senior leverage ratios (expressed as the principal amount of Senior Notes over our Adjusted EBITDA (as defined in our lender agreements and also set forth below) measured on a trailing, four-quarter basis) of 11.25, 11.0 and 10.0 times for the first three quarters of 2011 being replaced by a covenant waiver for the first quarter and minimum last twelve months (“LTM”) EBITDA thresholds of $4,000 and $7,000, respectively, for the second and third quarters of 2011. Debt leverage covenants for the last quarter of 2011 and the first two quarters in 2012 (the Senior Notes mature on July 15, 2012) remain unchanged. The quarterly debt leverage covenants that appear in the Credit Agreement (governing the Senior Credit Facility) were also amended to reflect a change to minimum LTM EBITDA thresholds and maintain the additional 15% cushion that exists between the debt leverage covenants applicable to the Senior Credit

Facility and the corresponding covenants applicable to the Senior Notes. By way of example, the minimum LTM EBITDA thresholds of $4,000 and $7,000 for the second and third quarters of 2011 in the Securities Purchase Agreement (applicable to the Senior Notes) are $3,400 and $5,950, respectively, in the Credit Agreement (governing the Senior Credit Facility). In connection with this amendment, Gores agreed to fully subordinate the Senior Notes it holds (approximately $10,222 which is listed under “due to Gores”) to the Senior Notes held by the non-Gores holders, including in connection with any future pay down of Senior Notes from the proceeds of any asset sale, a 5% leverage fee will be imposed effective October 1, 2011 and we agreed to report the status of any mergers and acquisition discussions/activity on a bi-weekly basis. Notwithstanding the foregoing, if at any time, we provide satisfactory documentation to our lenders that our debt leverage ratio for any LTM period complies with the following debt covenant levels for the five quarters beginning on June 30, 2011: 5.00, 5.00, 4.50, 3.50 and 3.50, and provided more than 50% of the outstanding amount of non-Gores Senior Notes (i.e., Senior Notes held by the non-Gores holders) shall have been repaid as of such date, then the 5% leverage fee would be eliminated on a prospective basis. The foregoing levels represent the same covenant levels set forth in the Second Amendment to the Securities Purchase Agreement entered into on March 30, 2010, except that the debt covenant level for June 30, 2011 was 5.50 in the Second Amendment. As part of the waiver and fourth amendment, we agreed we would need to comply with a 5.00 covenant level on June 30, 2011, on an LTM basis, for the 5% leverage fee to be eliminated. The 5% leverage fee will be equal to 5% of the Senior Notes outstanding for the period beginning October 1, 2011, and shall accrue on a daily basis from such date until the fee amount is paid in full. The fee shall be payable on the earlier of maturity (July 15, 2012) or the date on which the Senior Notes are paid. Accrued and unpaid leverage fee amounts shall be added to the principal amount of the Senior Notes at the end of each calendar quarter (as is the case with PIK interest on the Senior Notes which accretes to the principal amount on a quarterly basis).

Prior to the aforementioned amendment, in 2010, we entered into two amendments to our debt agreements with our lenders (on March 30, 2010 and August 17, 2010, respectively). In both instances, our underperformance against our financial projections caused us to reduce our forecasted results. While our projections indicated that we would attain sufficient Adjusted EBITDA to comply with the debt leverage covenants then in place, management did not believe there was sufficient cushion in our projections of Adjusted EBITDA to predict with any certainty that we would satisfy such covenants given the unpredictability in the economy and our business. Additionally, given our constrained liquidity on June 30, 2010 and our revised projections in place at such time, management believed it was prudent to renegotiate amendments to our debt agreements to enhance our available liquidity in addition to modifying our debt leverage covenants. These negotiations resulted in the August 17, 2010 amendment in which Gores agreed to purchase an additional $15,000 of common stock. As a result thereof, 769,231 shares were issued to Gores on September 7, 2010 for approximately $5,000 and Gores satisfied a $10,000 Gores equity commitment by purchasing 1,186,240 shares of common stock at a per share price of $8.43, calculated in accordance with the trailing 30-day weighted average of our common stock’s closing price as set forth in our purchase agreement with Gores. As a result of the third amendment to the Securities Purchase Agreement entered into on August 17, 2010, our debt leverage covenants were modified to 11.25 times for the three quarters beginning on September 30, 2010, then stepping down to 11.0, 10.0, and 9.0 times in the last three quarters of 2011 and 8.0 and 7.5 times in the first two quarters of 2012. The quarterly debt leverage covenants that appear in the Credit Agreement (governing the Senior Credit Facility) were also amended to maintain the additional 15% cushion that exists between the debt leverage covenants applicable to the Senior Credit Facility and the corresponding covenants applicable to the Senior Notes. By way of example, the levels of 11.25 in the Securities Purchase Agreement (applicable to the Senior Notes) are 12.95 in the Credit Agreement (governing the Senior Credit Facility). We accrued additional fees of $2,433 related to amending our credit agreements in the year ended December 31, 2010 recorded as interest expense.

On March 31, 2010, June 4, 2010 and November 30, 2010, we repaid $3,500, $12,000 and $532, respectively, of the Senior Notes in accordance with the agreements related to our debt covenants.

Adjusted EBITDA has the same definition in both of our borrowing agreements and means Consolidated Net Income adjusted for the following: (1) minus any net gain or plus any loss arising from the sale or other disposition of capital assets; (2) plus any provision for taxes based on income or profits; (3) plus consolidated net interest expense; (4) plus depreciation, amortization and other non-cash losses, charges or expenses (including impairment of intangible assets and goodwill); (5) minus any “extraordinary,” “unusual,” “special” or “non-recurring” earnings or gains or plus any “extraordinary,” “unusual,” “special” or “non-recurring” losses, charges or expenses; (6) plus restructuring expenses or charges; (7) plus non-cash compensation recorded from grants of stock appreciation or

similar rights, stock options, restricted stock or other rights; (8) plus any Permitted Glendon/Affiliate Payments (as described below); (9) plus any Transaction Costs (as described below); (10) minus any deferred credit (or amortization of a deferred credit) arising from the acquisition of any Person; and (11) minus any other non-cash items increasing such Consolidated Net Income (including, without limitation, any write-up of assets); in each case to the extent taken into account in the determination of such Consolidated Net Income, and determined without duplication and on a consolidated basis in accordance with GAAP. For purposes thereof, “Permitted Glendon/Affiliate Payments” means payments made at our discretion to Gores and its affiliates including Glendon Partners for consulting services provided to Westwood One and “Transaction Costs” refers to the fees, costs and expenses incurred by us in connection with the Refinancing. Reference is made in this report to the refinancing of substantially all of our outstanding long-term indebtedness and recapitalization of our equity that closed on April 23, 2009 which is referred to in this report as the “Refinancing”.

Adjusted EBITDA, as we calculate it, may not be comparable to similarly titled measures employed by other companies. While Adjusted EBITDA does not necessarily represent funds available for discretionary use, and is not necessarily a measure of our ability to fund our cash needs, we use Adjusted EBITDA as defined in our lender agreements as a liquidity measure, which is different from operating cash flow, the most directly comparable financial measure calculated and presented in accordance with GAAP. We have provided under Item 7 — “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity” the requisite reconciliation of operating cash flow to Adjusted EBITDA.

Government Regulation

Radio broadcasting and station ownership are regulated by the Federal Communications Commission (the “FCC”). As a producer and distributor of radio programs and information services, we are generally not subject to regulation by the FCC. The Traffic and Information Division utilizes FCC regulated two-way radio frequencies pursuant to licenses issued by the FCC.

Employees

On December 31, 2010, we had approximately 1,500 employees, including approximately 485 part-time employees. In addition, we maintain continuing relationships with numerous independent writers, program hosts, technical personnel and producers. Approximately 510 of our employees are covered by collective bargaining agreements. We believe relations with our employees, unions and independent contractors are satisfactory.

Significant Agreement

Our Master Agreement with CBS Radio documents a long-term distribution arrangement in which CBS Radio will broadcast certain of our commercial inventory for our Network Radio and Metro Traffic and information businesses through March 31, 2017 in exchange for certain programming and/or cash compensation. The 2008 arrangement with CBS Radio is particularly important to us as in recent years the radio broadcasting industry has experienced a significant amount of consolidation that provides key radio groups with guaranteed and varied distribution channels. As a result, certain major radio station groups, including Clear Channel Communications, Cumulus Media (which recently announced it will purchase Citadel Media) and CBS Radio, have emerged as powerful forces in the industry. While we provide programming to all major radio station groups, our extended affiliation agreements with most of CBS Radio’s owned and operated radio stations provide us with a significant portion of audience that we sell to advertisers in numerous top markets.

Available Information

We are a Delaware corporation, having re-incorporated in Delaware on June 21, 1985. Our current and periodic reports filed with the Securities and Exchange Commission (“SEC”), including amendments to those reports, may be obtained through our internet website at www.westwoodone.com ; directly from us in print upon request to Westwood One, Inc., 1166 Avenue of the Americas, 10 ^th Floor, New York NY, 10036, Attn: Secretary or from the SEC’s website at www.sec.gov free of charge as soon as reasonably practicable after we file these reports with the SEC. Additionally, any reports or information that we file with the SEC may be read and copied at the SEC’s Public Reference Room at 100 F Street, Washington, DC. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. You may also obtain copies of this information by mail from the Public Reference Section of the SEC, 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates.

Cautionary Statement regarding Forward-Looking Statements

This annual report on Form 10-K, including Item 1A—Risk Factors and Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains both historical and forward-looking statements. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements we make or others make on our behalf. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These statements are not based on historical fact but rather are based on management’s views and assumptions concerning future events and results at the time the statements are made. No assurances can be given that management’s expectations will come to pass. There may be additional risks, uncertainties and factors that we do not currently view as material or that are not necessarily known. Any forward-looking statements included in this document are only made as of the date of this document and we do not have any obligation to publicly update any forward-looking statement to reflect subsequent events or circumstances.

Item 1A. Risk Factors

An investment in our common stock is speculative and involves a high degree of risk. You should carefully consider the risks described below, together with the other information contained in this Annual Report on Form 10-K. The risks described below could have a material adverse effect on our business, financial condition and results of operations.

Risks Related to Our Business and Industry

While our year-over-year annual operating performance increased for the first time since year end 2005, we continue to incur operating losses and there can be no assurance that our performance will continue to improve. If it does not continue and we were to continue to incur operating losses, we could lack sufficient funds to continue to operate our business in the ordinary course.

Our annual operating loss for the year ended December 31, 2010 decreased $75,542 to $22,039 from the comparable period in 2009. The decrease was $25,041 absent 2009 goodwill and intangible asset impairment charges of $50,501. While such is an improvement, it remains a significant drop from our operating income of $63,307 in 2007. We cannot provide any assurance as to whether we will be able to continue to increase our operating performance, which has in the past been negatively affected by lower commercial clearance, a decline in our sales force and reductions in national audience levels across the industry and locally at our affiliated stations, and more recently by higher programming fees and station compensation costs. In 2008 and 2009, our operating income was also affected by the weakness in the United States economy and advertising market. In 2010, the overall economic recovery, especially in the advertising marketplace, was slower than we projected and that radio industry analysts had forecast. During the economic downturn, advertisers and the agencies that represent them increased pressure on advertising rates, and in some cases, requested steep percentage discounts on ad buys, demanded increased levels of inventory re-negotiated booked orders and released advertising funds as late as possible in the cycle. Although there has been an improvement in the economy, advertisers’ demands and advertising budgets have not improved to pre-recession levels. If a double-dip recession were to occur or if the economic climate does not improve sufficiently for us to generate advertising revenue to meet our projections, our financial position could worsen to the point where we would lack sufficient liquidity to continue to operate our business in the ordinary course.

If our operating results do not achieve our financial projections, we may require additional funding or a further amendment and/or waiver of our debt leverage covenants, which if not obtained, would have a material and adverse effect on our business continuity and our financial condition.

We are operating in an uncertain economic environment, where the pace of an advertising recovery is unclear and we are facing increased cost pressures as described above. As further described under “Existing Indebtedness” below, in March 2011 our financial results projections indicated that we would likely not attain sufficient Adjusted EBITDA to comply with our then existing debt leverage covenants in certain fiscal quarters of 2011. As a result, on April 12, 2011 we entered into the waiver and fourth amendment to the Securities Purchase Agreement (see Item 1 Business — Significant Events — Credit Agreement Amendments) which resulted in our previously existing maximum senior leverage ratios of 11.25, 11.0 and 10.0 times for the first three quarters of 2011 being replaced by a covenant waiver for the first quarter of 2011 and minimum LTM EBITDA thresholds of $4,000 and $7,000 for the second and third quarters of 2011. If our operating results fall short of our minimum LTM EBITDA thresholds, we will need a further amendment and/or waiver of our debt leverage covenants or potentially additional funds. If financing is limited or unavailable to us or if we are forced to fund our operations at a higher cost, these conditions could require us to curtail our business activities or increase our cost of financing, both of which could reduce our profitability or increase our losses. If we were to require additional financing or a further amendment or waiver of our debt leverage covenants, which could not then be obtained, it would have a material adverse effect on our financial condition and on our ability to meet our obligations.

We have a significant amount of indebtedness and limited liquidity, which could adversely affect our operations, flexibility in running our business and our ability to service our debt if our future operating performance does not meet our financial projections.

As of December 31, 2010, we had $111,629 in aggregate principal amount of Senior Notes outstanding (of which approximately $10,161 is PIK (paid-in-kind interest)), which bears interest at a rate of 15.0%, and a Senior Credit Facility consisting of a $20,000 term loan and a $20,000 revolving credit facility under which $15,000 was drawn (not including $1,219 in letters of credit used as security on various leased properties). Such debt matures on July 15, 2012 (and accordingly will become short-term, not long-term, debt in the third quarter of 2011). Loans under our Senior Credit Facility bear interest at LIBOR plus 4.5% (with a LIBOR floor of 2.5%) or a base rate plus 4.5% (with a base rate floor equal to the greater of 3.75% or the one-month LIBOR rate). As described above in Item 1 — Business — Significant Events — Credit Agreement Amendments, on April 12, 2011, we entered into a waiver and fourth amendment with our lenders to replace our debt leverage covenants of 11.25, 11.0 and 10.0 times for the first three quarters of 2011 with a covenant waiver for the first quarter of 2011 and minimum LTM EBITDA thresholds of $4,000 and $7,000 for the second and third quarters of 2011 which amendment includes a 5% debt leverage fee becoming payable for debt outstanding on or after October 1, 2011. Notwithstanding the foregoing, if at any time, we provide satisfactory documentation to our lenders that our debt leverage ratio for any LTM period complies with the following debt covenant levels for the five quarters beginning on June 30, 2011: 5.00, 5.00, 4.50, 3.50 and 3.50, and provided more than 50% of the outstanding amount of non-Gores Senior Notes (i.e., Senior Notes held by the non-Gores holders) shall have been repaid as of such date, then the 5% leverage fee that would otherwise be payable at the end of the calendar quarter after such events occurred would be eliminated on a prospective basis. The April 2011 amendment is in addition to the August 2010 amendment whereby Gores agreed to provide us with $20,000 in additional liquidity, including a guarantee of an additional $5,000 for our revolving credit facility which resulted in Wells Fargo agreeing to increase the amount thereof from $15,000 to $20,000 which provided us with necessary additional liquidity for working capital purposes. Our ability to service our debt for the next twelve months will depend on our financial performance in an uncertain and unpredictable economic environment as well as on competitive pressures. Despite having previously successfully negotiated amendments to our credit documents, if we were to significantly underperform against the minimum LTM EBITDA thresholds listed above we might be unable to further amend our debt agreements on terms that are acceptable to us or our lenders. Further, our Senior Notes and Senior Credit Facility restrict our ability to incur additional indebtedness beyond certain minimum baskets. If our operating results decline or we do not meet our minimum LTM EBITDA thresholds, and we are unable to obtain a waiver to increase our indebtedness and/or successfully raise funds through an issuance of equity, we would lack sufficient liquidity to operate our business in the ordinary course, which would have a material adverse effect on our business, financial condition and results of operations. If we were then unable to meet our debt service and repayment obligations under the Senior Notes or the Senior Credit Facility, we would be in default under the terms of the agreements governing our debt, which if uncured, would allow our creditors at that time to declare all outstanding indebtedness to be due and payable and materially impair our financial condition and liquidity.

Our Senior Credit Facility and Senior Notes contain various covenants which, if not complied with, could accelerate repayment under such indebtedness, thereby materially and adversely affecting our financial condition and results of operations.

Our Senior Credit Facility and Senior Notes require us to comply with certain financial and operational covenants. These covenants (as amended on April 12, 2011) include, without limitation:

	•		a debt leverage covenant waiver for the first quarter of 2011;
	•		a minimum LTM EBITDA threshold (measured on a trailing, four-quarter basis) of $4,000 and $7,000 (in the Securities Purchase Agreement) for the second and third quarters of 2011, respectively;
	•		a maximum senior leverage ratio (expressed as the principal amount of Senior Notes over our Adjusted EBITDA (as defined in our lender agreements) measured on a trailing, four-quarter basis) of 9.0 to 1.0 ratio on December 31, 2011, a 8.0 to 1.0 ratio on March 31, 2012, and a 7.5 to 1.0 ratio on June 30, 2012; and
	•		restrictions on our ability to incur debt, incur liens, make investments, make capital expenditures, consummate acquisitions, pay dividends, sell assets and enter into mergers and similar transactions.

We waived and/or amended our debt leverage covenants on October 14, 2009, March 30, 2010, August 17, 2010 and most recently on April 12, 2011. As a result of these amendments, our debt leverage covenants have been waived, significantly eased and/or modified to minimum LTM EBITDA thresholds. We believe we will generate sufficient Adjusted EBITDA to comply with our amended debt leverage covenants. However, failure to comply with any of our covenants would result in a default under our Senior Credit Facility and Senior Notes that, if we were unable to obtain a waiver from the lenders or holders thereof, could accelerate repayment under the Senior Credit Facility and Senior Notes and thereby have a material adverse impact on our business.

Our Senior Credit Facility and Senior Notes mature on July 15, 2012; if we are unable to refinance or otherwise repay such indebtedness there would be a material and adverse effect on our business continuity and our financial condition.

As the maturity date for our Senior Credit Facility and Senior Notes approaches, we are evaluating, and will continue to evaluate, our options to refinance or repay such indebtedness. Options may include potential mergers and acquisitions activity and/or refinancing alternatives in the debt and capital markets, either of which could include a partial or complete paydown of our Senior Notes. In addition to assessing the potential opportunities noted above, we will discuss refinancing options with our Senior Lenders.

If we do not have the capital necessary to repay our senior indebtedness when it matures, it will be necessary for us to take significant actions, such as revising or delaying our strategic plans, reducing or delaying planned capital expenditures, selling assets, restructuring or refinancing our debt or seeking additional equity capital. We may be unable to effect any of these remedial steps on a satisfactory basis, or at all. If we are unable to refinance or otherwise repay our senior debt upon the maturity of our indebtedness, we would be in default, which would result in material adverse consequences for the Company.

The cost of our indebtedness is substantial, which further affects our liquidity and could limit our ability to implement our business plan.

Interest payments on our debt, which did not include PIK, during 2010 were $11,468. PIK interest which accrues and is added to the principal amount of our debt on a quarterly basis will be approximately $19,050 at maturity on July 15, 2012. As a result of the waiver and fourth amendment to our credit agreements, there is also a 5% debt leverage fee that is equal to 5% of the Senior Notes outstanding for the period beginning October 1, 2011, and shall accrue on a daily basis until the fee amount is paid in full. Like PIK, the accrued and unpaid leverage fee amounts shall be added to the principal amount of the Senior Notes at the end of each calendar quarter which means the debt leverage fee would be $4,907 as of July 15, 2012 assuming no prior repayment. If the economy does not improve more significantly and advertisers continue to maintain reduced budgets and/or if our financial results continue to come under pressure, we may be required to delay the implementation or reduce the scope of our business plan and our ability to develop or enhance our services or programs will likely be impacted. Without additional revenue and capital, we will be unable to take advantage of business opportunities, such as acquisition opportunities or securing rights to name-brand or popular programming, or respond to competitive pressures. If any of the foregoing should occur, this could have a material and adverse effect on our business.

CBS Radio provides us with a significant portion of our commercial inventory and audience that we sell to advertisers. A material reduction in the audience delivered by CBS Radio stations or a material loss of commercial inventory from CBS Radio would have an adverse effect on our advertising sales and financial results.

While we provide programming to all major radio station groups, we have affiliation agreements with most of CBS Radio’s owned and operated radio stations which, in the aggregate, provide us with a significant portion of the audience and commercial inventory that we sell to advertisers, much of which is in the more desirable top 10 radio markets. Although the compensation we pay to CBS Radio under our March 2008 arrangement is adjustable based on the audience levels and commercial clearance it delivers ( i.e., the percentage of commercial inventory broadcast by CBS Radio stations), any significant loss of audience or inventory delivered by CBS Radio stations, including, by way of example only, as a result of a decline in station audience, commercial clearance levels or station sales that resulted in lower audience levels, would have a material adverse impact on our advertising sales and revenue. Since implementing the new arrangement in early 2008, CBS Radio has delivered improved audience levels and broadcast more advertising inventory than it had under our previous arrangement. However, there can be no assurance that CBS Radio will maintain these higher levels. As part of the cost reduction actions we undertook in early 2010 to reduce station compensation expense, we and CBS Radio mutually agreed to enter into an arrangement, effective on February 15, 2010, to give back inventory delivered by CBS Radio which resulted in a commensurate reduction in the cash compensation we pay to them. In order to offset our return of inventory to CBS Radio and to help deliver consistent RADAR audience levels over time, we added incremental inventory from non-CBS stations. We also added Metro Traffic inventory from CBS Radio through various stand-alone agreements. We actively manage our inventory, including by purchasing additional inventory for cash. While our arrangement with CBS Radio is scheduled to terminate in 2017, there can be no assurance that such arrangement will not be breached by either party. If our agreement with CBS Radio were terminated as a result of such breach, our results of operations could be materially impacted.

Our ability to grow our Metro Traffic business revenue may be adversely affected by the increased proliferation of free of charge traffic content to consumers.

Our Metro Traffic business produces and distributes traffic and other local information reports to approximately 2,250 radio and 182 television affiliates and we derive the substantial majority of the revenue attributed to this business from the sale of commercial advertising inventory embedded within these reports. In recent years, the US Department of Transportation and other regional and local departments of transportation have significantly increased their direct provision of real-time traffic and traveler information to the public free of charge. The ability to obtain this information free of charge may result in our radio and television affiliates electing not to utilize the traffic and local information reports produced by our Metro Traffic business, which in turn could adversely affect our revenue from the sale of advertising inventory embedded in such reports.

Our ability to improve our operating results largely depends on the audiences we deliver to our advertisers.

Our revenue is derived from advertisers who purchase commercial time based on the audience reached by those commercials. Advertisers determine the audience(s) they want to reach according to certain criteria, including the size of the audience, their demographics (e.g., gender, age), the market and daypart in which their commercials are broadcast and the format of the station on which the commercials are broadcast. The new electronic audience measurement technology known as The Portable People Meter™, or PPM™, introduced in 2007 impacted audience levels for most programming across the radio industry in the first few years of its introduction (2008-2010). However, in the most recent book, RADAR 108, that reported ratings for our RADAR inventory (which comprises approximately half of our total inventory) the first 33 markets (including 19 of the top 20 markets) were fully incorporated into the ratings books and all 48 markets have been incorporated (at some level) into the RADAR books which leads us to believe the impact of PPM has been largely absorbed by the marketplace. However, we may continue to be impacted by PPM as 15 markets have yet to be fully incorporated into the ratings books. Audience levels also can change for several reasons other than PPM, including changes in the radio stations included in a RADAR network, such stations’ clearance rates for our inventory, general radio listening trends and additional changes in how audience is measured. In 2010, we were able to offset the impact of audience declines by purchasing additional inventory at cost effective prices, however, if the general economy and advertising market were to recover significantly, inventory could become more expensive. Additionally, additional inventory may need to be purchased in advance of our having definitive data on audience levels, such that if we do not accurately predict how much additional inventory will be required to offset declines in audience, or cannot purchase comparable inventory to our current inventory at efficient prices, our future operating profits could be materially and adversely affected.

Our business is subject to increased competition from new entrants into our business, consolidated companies and new technologies/platforms, each of which has the potential to adversely affect our business.

Our business segments operate in a highly competitive environment. Our radio and television programming competes for audiences and advertising revenue directly with radio and television stations and other syndicated programming. We also compete for advertising dollars with other media such as television, satellite radio, newspapers, magazines, cable television, outdoor advertising, direct mail and, increasingly, digital media. While the overall radio audience has remained stable, these new media platforms have gained an increased share of advertising dollars and their introduction could lead to decreasing revenue for traditional media. Further, as we expend resources to expand our programming and services in new digital distribution channels, our operating results could be negatively impacted until we begin to gain traction in these emerging businesses. New or existing competitors may have resources significantly greater than our own. In particular, the consolidation of the radio industry has created opportunities for large radio groups, such as Clear Channel Communications, CBS Radio and Citadel Broadcasting Corporation to gather information and produce radio and television programming on their own. Although our network radio market share has improved year-over-year according to the October 2010 Miller Kaplan report, there can be no assurance that we will be able to maintain or increase our market share, our audience ratings or our advertising revenue given this competition. To the extent audience for our programs were to decline, advertisers’ willingness to purchase our advertising could be reduced. Additionally, audience ratings and performance-based revenue arrangements are subject to change based on the competitive environment and any adverse change in a particular geographic area could have a material and adverse effect on our ability to attract not only advertisers in that region, but national advertisers as well.

In recent years, digital media platforms and the offerings thereon have increased significantly and consumers are playing an increasingly large role in dictating the content received through such mediums. We face increasing pressure to adapt our existing programming as well as to expand the programming and services we offer to address these new and evolving digital distribution channels. Advertising buyers have the option to filter their messages through various digital platforms and as a result, many are adjusting their advertising budgets downward with respect to traditional advertising mediums such as radio and television or utilizing providers who offer “one-stop shopping” access to both traditional and alternative distribution channels. If we are unable to offer our broadcasters and advertisers an attractive full suite of traditional and new media outlets and address the industry shift to new digital mediums, our operating results may be negatively impacted.

Our failure to obtain or retain the rights in popular programming could adversely affect our operating results.

The operating results from our radio programming and television business depends in part on our continued ability to secure and retain the rights to popular programming and then to sell such programming at a profit. We obtain a significant portion of our programming from third parties. For example, some of our most widely heard broadcasts, including certain NFL and NCAA games, are made available based upon programming rights of varying duration that we have negotiated with third parties. Competition for popular programming that is licensed from third parties is intense, and due to increased costs of such programming or potential capital constraints, we may be outbid by our competitors for the rights to new, popular programming or to renew popular programming currently licensed by us. Even when we are able to secure popular programming, the fee thereof (particularly sports programs and high-profile talent), is often significantly increased as a result of the competitive bidding process, which requires that we sell the advertising in this programming at a sufficiently higher volume and rate to offset the increased fees. Our failure to obtain or retain rights to popular content (or the temporary loss of such content as would be the case for our NFL programming in the event of an NFL lock-out) could adversely affect our operating results.

If we are not able to integrate future M&A activity successfully, our operating results could be harmed.

We evaluate mergers and acquisitions (“M&A”) opportunities, including acquisitions and dispositions, on an ongoing basis and intend to pursue opportunities in our industry and related industries that can assist us in achieving our growth strategy. The success of our future strategy will depend on our ability to identify, negotiate, complete and integrate M&A opportunities and, if necessary, to obtain satisfactory debt or equity financing to fund such opportunities. M&A is inherently risky, and any M&A transactions we do complete may not be successful.

Even if we are able to consummate the M&A transactions we pursue, such transactions may involve certain risks, including, but not limited to, the following:

	•		difficulties in integrating and managing the operations, technologies and products of the companies we merge with and/or acquire;
	•		diversion of our management’s attention from normal daily operations of our business;
	•		our inability to maintain the key business relationships and reputations in connection with such M&A;
	•		uncertainty of entry into markets in which we have limited or no prior experience or in which competitors have stronger market positions;
	•		our dependence on unfamiliar affiliates and partners of the companies we merge with and/or acquire;
	•		insufficient revenue to offset our increased expenses associated with the M&A transactions we consummate or inability to realize the synergies we identify;
	•		our responsibility for the liabilities of the businesses we merge with and/or acquire; and
	•		potential loss of key employees in connection with such M&A.

Our success is dependent upon audience acceptance of our content, particularly our radio programs, which is difficult to predict.

Revenue from our radio and television businesses is dependent on our continued ability to anticipate and adapt to changes in consumer tastes and behavior on a timely basis. Because consumer preferences are consistently evolving, the commercial success of a radio program is difficult to predict. It depends on the quality and acceptance of other competing programs, the availability of alternative forms of entertainment, general economic conditions and other tangible and intangible factors, all of which are difficult to predict. An audience’s acceptance of programming is demonstrated by rating points which are a key factor in determining the advertising rates that we receive. Low ratings can lead to a reduction in pricing and advertising revenue. Consequently, low public acceptance of our content, particularly our radio programs, could have an adverse effect on our results of operations.

We may be required to recognize further impairment charges.

On an annual basis and upon the occurrence of certain events, we are required to perform impairment tests on our identified intangible assets with indefinite lives, including goodwill, and long-lived assets which testing could impact the value of our business. We have a history of recognizing impairment charges related to our goodwill and intangible assets. In connection with our Refinancing and our requisite adoption of the acquisition method of accounting, we recorded new values of certain assets such that as of April 24, 2009, our revalued goodwill was $86,414 (an increase of $52,426) and intangible assets were $116,910 (an increase of $114,481). In September 2009, we believe a triggering event occurred as a result of forecasted results for 2009 and therefore we conducted a goodwill impairment analysis that resulted in an impairment charge in our Metro Traffic segment of $50,501.

Risks Related to Our Common Stock

Our common stock may not maintain an active trading market which could affect the liquidity and market price of our common stock.

On November 20, 2009, we listed our common stock on the NASDAQ Global Market. However, there can be no assurance that an active trading market on the NASDAQ Global Market will be maintained, that our common stock price will increase or that our common stock will continue to trade on the exchange for any specific period of time. If we are unable to maintain our listing on the NASDAQ Global Market, we may be subject to a loss of confidence by customers and investors and the market price of our shares may be affected.

Sales of additional shares of common stock by Gores or our other lenders could adversely affect the stock price.

Gores beneficially owns 17,212,977 shares, or approximately 76.4%, of our common stock, which reflects the common stock it purchased in September 2010 and February 2011. There can be no assurance that at some future time Gores, or our other lenders (who collectively own 20.5% of our common stock), will not, subject to the applicable volume, manner of sale, holding period and limitations of Rule 144 under the Securities Act, sell additional shares of our common stock, which could adversely affect our share price. The perception that these sales might occur could also cause the market price of our common stock to decline. Such sales could also make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem appropriate.

Gores will be able to exert significant influence over us and our significant corporate decisions and may act in a manner that advances its best interest and not necessarily those of other stockholders.

As a result of its beneficial ownership of 17,212,977 shares, or approximately 76.4%, of our common stock, Gores has voting control over our corporate actions. For so long as Gores continues to beneficially own shares of common stock representing more than 50% of the voting power of our common stock, it will be able to elect all of the members of our Board and determine the outcome of all matters submitted to a vote of our stockholders, including matters involving mergers or other business combinations, the acquisition or disposition of assets, the incurrence of indebtedness, the issuance of any additional shares of common stock or other equity securities and the payment of dividends on common stock. Gores may act in a manner that advances its best interests and not necessarily those of other stockholders by, among other things:

	•		delaying, deferring or preventing a change in control;
	•		impeding a merger, consolidation, takeover or other business combination;
	•		discouraging a potential acquirer from making a tender offer or otherwise attempting obtain control; or
	•		causing us to enter into transactions or agreements that are not in the best interests of all of our stockholders.

Provisions in our restated certificate of incorporation and by-laws and Delaware law may discourage, delay or prevent a change of control of our company or changes in our management and, therefore, depress the trading price of our common stock.

Provisions of our restated certificate of incorporation and by-laws and Delaware law may discourage, delay or prevent a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in which you might otherwise receive a premium for your shares of our common stock. These provisions may also prevent or frustrate attempts by our stockholders to replace or remove our management. The existence of the foregoing provisions and anti-takeover measures could limit the price that investors might be willing to pay in the future for shares of our common stock. They could also deter potential acquirers of our company, thereby reducing the likelihood that you could receive a premium for your common stock in an acquisition. In addition, we are subject to the provisions of Section 203 of the Delaware General Corporation Law, which may prohibit certain business combinations with stockholders owning 15% or more of our outstanding voting stock. This provision of the Delaware General Corporation Law could delay or prevent a change of control of our company, which could adversely affect the price of our common stock.

We do not anticipate paying dividends on our common stock.

We do not anticipate paying any cash dividends on our common stock in the foreseeable future. We currently anticipate that we will retain all of our available cash, if any, for use as working capital and for other general corporate purposes. Any payment of future cash dividends will be at the discretion of our Board and will depend upon, among other things, our earnings, financial condition, capital requirements, level of indebtedness, statutory and contractual restrictions applying to the payment of dividends and other considerations that our Board deems relevant. In addition, our Senior Credit Facility and the Senior Notes restrict the payment of dividends.

Any issuance of shares of preferred stock by us could delay or prevent a change of control of our company, dilute the voting power of the common stockholders and adversely affect the value of our common stock .

Our Board has the authority to cause us to issue, without any further vote or action by the stockholders, up to 10,000 shares of preferred stock, in one or more series, to designate the number of shares constituting any series, and to fix the rights, preferences, privileges and restrictions thereof, including dividend rights, voting rights, rights and terms of redemption, redemption price or prices and liquidation preferences of such series. To the extent we choose to issue preferred stock, any such issuance may have the effect of delaying, deferring or preventing a change in control of our company without further action by the stockholders, even where stockholders are offered a premium for their shares.

The issuance of shares of preferred stock with voting rights may adversely affect the voting power of the holders of our other classes of voting stock either by diluting the voting power of our other classes of voting stock if they vote together as a single class, or by giving the holders of any such preferred stock the right to block an action on which they have a separate class vote even if the action were approved by the holders of our other classes of voting stock.

The issuance of shares of preferred stock with dividend or conversion rights, liquidation preferences or other economic terms favorable to the holders of preferred stock could adversely affect the market price for our common stock by making an investment in the common stock less attractive. For example, investors in the common stock may not wish to purchase common stock at a price above the conversion price of a series of convertible preferred stock because the holders of the preferred stock would effectively be entitled to purchase common stock at the lower conversion price causing economic dilution to the holders of common stock.

The foregoing risk factors that appear above may affect future performance. The accuracy of the forward-looking statements included in the risk factors above are illustrative, but are by no means all-inclusive or exhaustive. Accordingly, all forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

The following table sets forth, as of December 31, 2010, the Company’s major facilities, all of which are leased.

				Approximate
Location		Use		Floor Space Sq. Ft.
New York, NY		Corporate Headquarters			39,000
New York, NY		Broadcasting Center			11,000
Silver Spring, MD		Broadcasting			21,000
Culver City, CA		Broadcasting			32,000

We believe that our facilities are adequate for our current level of operations.

Item 3. Legal Proceedings

On September 12, 2006, Mark Randall, derivatively on behalf of Westwood One, Inc., filed suit in the Supreme Court of the State of New York, County of New York, against us and certain of our current and former directors and certain former executive officers. The complaint alleges breach of fiduciary duties and unjust enrichment in connection with the granting of certain options to our former directors and executives. Plaintiff seeks judgment against the individual defendants in favor of us for an unstated amount of damages, disgorgement of the options which are the subject of the suit (and any proceeds from the exercise of those options and subsequent sale of the underlying stock) and equitable relief. Subsequently, on December 15, 2006, Plaintiff filed an amended complaint which asserts claims against certain of our former directors and executives who were not named in the initial complaint filed in September 2006 and dismisses claims against other former directors and executives named in the initial complaint. On March 2, 2007, we filed a motion to dismiss the suit. On April 23, 2007, Plaintiff filed its response to our motion to dismiss. On May 14, 2007, we filed our reply in furtherance of our motion to dismiss Plaintiff’s amended complaint. On August 3, 2007, the Court granted such motion to dismiss and denied Plaintiff’s request for leave to replead and file a further amended complaint. On September 20, 2007, Plaintiff appealed the Court’s dismissal of its complaint and moved for “renewal” under CPLR 2221(e). Oral argument on Plaintiff’s motion for renewal occurred on October 31, 2007. On April 22, 2008, Plaintiff withdrew its motion for renewal, without prejudice to renew.

Item 4. [Removed and Reserved]

PART II

(In thousands, except per share amounts)

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

On February 28, 2011, there were approximately 196 holders of record of our common stock, several of which represent “street accounts” of securities brokers. We estimate that the total number of beneficial holders of our common stock exceeds 4,200 .

The following table sets forth the range of high and low sales prices for the common stock for the calendar quarters indicated.

2010		High				Low
First Quarter		$	14.82			$	3.63
Second Quarter			17.99				7.06
Third Quarter			9.92				5.81
Fourth Quarter			11.60				7.90

2009 (1)		High				Low
First Quarter		$	0.12			$	0.02
Second Quarter			0.12				0.05
Third Quarter (through August 4, 2009)			0.06				0.04
Third Quarter (from August 5, 2009 through September 30, 2009) (2)			11.00				3.25
Fourth Quarter			6.50				3.21

The amounts in the table for the periods ending on or prior to August 4, 2009 do not reflect the 200 for 1 reverse stock split of our outstanding common stock and the conversion of all outstanding shares of Series A-1 Preferred Stock and Series B Preferred Stock into common stock that occurred on August 3, 2009. The closing price for our common stock on March 31, 2011 was $7.25.

The payment of dividends is prohibited by the terms of our Senior Notes and Senior Credit Facility, and accordingly, we do not plan on paying dividends for the foreseeable future.

Equity Compensation Plan Information (1)

The following table contains information as of December 31, 2010 regarding our equity compensation plans.

Number of securities

remaining available for

future issuance under

Number of securities to

Weighted average

equity compensation

be issued upon exercies

exercise price of

plus excluding

of outstanding options,

outstanding options,

securities reflected in

Plan Category

warrants and rights

warrants and rights

Column (a)

(a)

(b)

Equity compensation plans approved by security holders (1)

Options (2)

1,631,300

$

26.00

(3

)

Restricted Stock Units

115,100

N/A

(3

)

Restricted Stock

—

N/A

(3

)

Equity compensation plans not approved by security holders

—

—

—

Total

1,746,400

The performance graph below compares the performance of our common stock to the Dow Jones US Total Market Index and the Dow Jones US Media Index for the last five calendar years. The graph assumes that $100 was invested in our common stock and each index on December 31, 2005.

The following tables set forth the closing price of our common stock at the end of each of the last five years.

CUMULATIVE TOTAL RETURN		2006				2007				2008				2009				2010
Westwood One, Inc.			44.90				12.70				0.35				0.14				0.29
Dow Jones US Total Market Index			115.57				122.51				76.98				99.15				115.66
Dow Jones US Media Industry Index			126.45				110.51				65.05				94.55				118.34
Westwood One Closing Stock Price (1)			7.06				1.99				0.06				4.50				9.13

Item 6. Selected Financial Data

		Successor Company (1)									Predecessor Company (1)
		Year Ended				For the Period					For the Period
		December 31,				April 24, 2009 to					January 1, 2009				Year Ended December 31,
(In thousands)		2010				December 31, 2009					to April 23, 2009				2008				2007				2006
Consolidated Statements of Operations:
Revenue		$	362,546			$	228,860				$	111,474			$	404,416			$	451,384			$	512,085
Operating costs			342,258				210,805					111,309				357,927				350,440				395,196
Depreciation and amortization			18,243				21,474					2,584				11,052				19,840				20,756
Corporate general and administrative expenses			13,369				10,398					4,519				16,007				13,171				14,618
Goodwill and intangible asset impairment			—				50,501					—				430,126				—				515,916
Restructuring charges			2,899				3,976					3,976				14,100				—				—
Special charges			7,816				5,554					12,819				13,245				4,626				1,579
Operating (loss) income			(22,039	)			(73,848	)				(23,733	)			(438,041	)			63,307				(435,980	)
Interest expense			23,251				14,781					3,222				16,651				23,626				25,590
Other expense (income)			1,688				(4	)				(359	)			(12,369	)			(411	)			(926	)
Income tax (benefit) expense			(15,721	)			(25,025	)				(7,635	)			(14,760	)			15,724				8,809
Net (loss) income		$	(31,257	)		$	(63,600	)			$	(18,961	)		$	(427,563	)		$	24,368			$	(469,453	)
		Successor Company													Predecessor Company
		As of December 31,													As of December 31,
		2010				2009 (1)									2008				2007				2006
Consolidated Balance Sheet Data:
Current assets		$	117,916			$	125,741								$	119,468			$	138,154			$	149,222
Working capital (deficit) (2)			30,595				40,132									(208,034	)			47,294				29,313
Total assets			288,274				307,318									205,088				669,757				696,701
Long-term debt (2)			136,407				122,262									—				345,244				366,860
Due to Gores			10,222				11,165									—				—				—
Total stockholders’ (deficit) equity			(5,992	)			17,984									(203,145	)			227,631				202,931

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

(In thousands, except for per share amounts)

The following should be read in conjunction with the consolidated financial statements and related notes. Please see the section entitled “Cautionary Statement regarding Forward-Looking Statements” in Item 1- Business and Item 1A — Risk Factors.

OVERVIEW

Revenue

For the year ended December 31, 2010, revenue was $362,546, an increase of $22,212 or 6.5% and reflects higher revenue in both segments of our business.

In 2010, our Network Radio revenue grew by 7.1%, outpacing the overall network market which grew by 2.5% according to the December 2010 Miller Kaplan report. We believe our increased revenue resulted from our focus on delivering the best sports, talk, and music and entertainment programming and other key services to our affiliate and advertising customers. Additionally, our advertising revenue increased in the areas of sports, music and news programming. These increases were partially offset by a decline in advertising revenue from our talk radio programs and the cancellation of certain talk programs.

In 2010, Metro Traffic Radio revenue grew by 9.2%, which outpaced the growth of combined local/national radio growth of 6.0% that was reported by the Radio Advertising Bureau. In Metro Traffic Radio, we believe such resulted from strength in key advertising categories, such as financial services, retail, automotive, and restaurants, as well as from new inventory we have obtained as a result of our new affiliate agreements. This increase was partially offset by decreases in the travel and entertainment and home services sectors and a decline in Metro Television advertising revenue.

Net Loss

Our net loss for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 were $31,257, $63,600 and $18,961, respectively. Net loss per share attributable to common shareholders for basic and diluted shares for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 were $(1.50), $(11.75) and $(43.64), respectively.

Operating Cash Flow

Net cash provided by operating activities was $8,136 for the twelve months ended December 31, 2010, an increase of $33,055 compared to the twelve months ended December 31, 2009. The increase was principally attributable to a 2010 federal tax refund of $12,940 in 2010, a lower net decrease in our deferred taxes of $14,453, a lower net loss of $51,304 (primarily from the absence of the 2009 impairment charge of $50,501) and an increase in the change in working capital of $11,557, partially offset by lower other non-cash adjustments of $6,698.

Adjusted EBITDA

Our Adjusted EBITDA was $12,138 for the year ended December 31, 2010, an increase of $1,765 compared to $10,373 for the year ended December 31, 2009. The increase in Adjusted EBITDA is the result of an increase in Network Radio OBIDA of $3,118, partially offset by a decrease in Metro Traffic OIBDA of $686 and an increase in corporate expense (less equity-based compensation and special charges classified as corporate, general and administrative) of $667. A description of OIBDA appears above (Item 1 — Business — Business Segments: Network Radio and Metro Traffic).

Adjusted EBITDA for Network Radio increased $3,118 as a result of increased revenues of $13,139, partially offset by increased operating costs of $10,021.

Adjusted EBITDA for Metro Traffic decreased $686 as a result of increased operating costs of $9,759, partially offset by an increase in revenue of $9,073.

RESULTS OF OPERATION

Presentation of Results

Our consolidated financial statements and transactional records prior to the closing of the Refinancing reflect the historical accounting basis in our assets and liabilities and are labeled Predecessor Company, while such records subsequent to the Refinancing are labeled Successor Company and reflect the push down basis of accounting for the new fair values in our financial statements. This is presented in our consolidated financial statements by a vertical black line division which appears between the sections entitled Predecessor Company and Successor Company on the statements and relevant notes. The black line signifies that the amounts shown for the periods prior to and subsequent to the Refinancing are not comparable. For management purposes we continue to measure our performance against comparable prior periods.

We are organized into two business segments: Network Radio and Metro Traffic. Our Network Radio segment produces and distributes regularly scheduled and special syndicated programs, including exclusive live concerts, music and interview shows, national music countdowns, lifestyle short features, news broadcasts, talk programs, sporting events and sports features. Our Metro Traffic business produces and distributes traffic and other local information reports (such as news, sports and weather) to approximately 2,250 radio and 182 television stations. We evaluate segment performance based on segment revenue and OIBDA. Administrative functions such as finance, human resources and information systems are centralized. However, where applicable, portions of the administrative function costs are allocated between the operating segments. The operating segments do not share programming or report distribution. Operating costs are reported discretely within each segment. Our assets are reported discretely within each operating segment.

The principal components of our operating expenses are programming, production and distribution costs (including affiliate compensation and broadcast rights fees), selling expenses including commissions, promotional expenses and bad debt expenses, depreciation and amortization, and corporate general and administrative expenses. Corporate general and administrative expenses are primarily comprised of costs associated with corporate accounting, legal and administrative personnel costs, other administrative expenses, including those associated with corporate governance matters, and until its termination on March 3, 2008, the Management Agreement. Special charges include expenses associated with our debt agreements and amendments, the estimated cost accrued for settlement of the lawsuit filed by Triangle, corporate development, professional services rendered by various members of Gores and Glendon, Gores’ equity investments, the Refinancing, the stock offering undertaken by us in late 2009 that we have no immediate plans to further pursue, the renegotiation of the CBS agreements, write-down of certain costs associated with the TrafficLand arrangement, employment claim settlements and regionalization costs.

In those instances where we function as the principal in the transaction, the revenue and associated operating costs are presented on a gross basis in the Consolidated Statement of Operations. In those instances where we function as an agent or sales representative, our effective commission is presented within revenue with no corresponding operating expenses. Although no individual relationship is significant, the relative mix of such arrangements is significant when evaluating operating margin and/or increases and decreases in operating expenses.

We have identified certain immaterial errors in our financial statements, which we corrected in subsequent interim periods. Such items have been reported and disclosed in the financial statements for the periods ended December 31, 2010, 2009 and 2008, as applicable. We do not believe these adjustments are material to our current period consolidated financial statements or to any prior period’s consolidated financial statements and accordingly we have not restated any prior period financial statements. In an ongoing effort to improve our control environment, we have made further enhancements to our financial reporting personnel in 2010 and intend to continue to evaluate our internal controls and make further improvements as necessary.

Goodwill and Intangible Asset Impairment

As part of our annual impairment tests of goodwill and indefinite lived intangible assets, at December 31, 2010, we performed a Step 1 analysis by comparing our calculated fair value based on our forecast to our current carrying value. The results indicated a potential impairment in our Metro Traffic segment and we performed a Step 2 analysis to compare the implied fair value of goodwill to the carrying value of its goodwill. As a result of the Step 2 analysis, we determined that there was no impairment to goodwill as of December 31, 2010. On April 1, 2011 we filed a notice of late filing on Form 12b-25 with the SEC, which estimated an impairment charge between $15,000 and $25,000 as of December 31, 2010. Subsequent to such filing we finalized our conclusion on the appropriate discount rate to be incorporated into our impairment model and concluded that we did not have an impairment as of December 31, 2010.

Restructuring

In the second quarter of 2010, we restructured certain areas of the Network Radio and Metro Traffic segments (the “2010 Program”). The 2010 Program included charges related to the consolidation of certain operations that reduced our workforce levels during 2010, and additional actions to reduce our workforce as an extension of the Metro Traffic re-engineering. In connection with the 2010 Program, we recorded $1,198 of costs for the year ended December 31, 2010. All costs related to the 2010 Program were incurred by the end of 2010.

In the third quarter of 2008, we announced a plan to restructure our Metro Traffic business (commonly referred to by us as the “Metro Traffic re-engineering”) and to implement other cost reductions. The Metro Traffic re-engineering entailed reducing the number of our Metro Traffic operational hubs from 60 to 13 regional centers and produced meaningful reductions in labor expense, aviation expense, station compensation, program commissions and rent. Since the commencement of the Metro Traffic re-engineering, we recorded $23,753 including severance of $10,454, contract terminations of $6,751 and facilities consolidation costs of $6,548. All costs related to the Metro Traffic re-engineering were incurred by the end of 2010. Future expense related to the Metro Traffic re-engineering will be adjustments for changes, if any, resulting from revisions to our estimated sublease cash flows from facilities we closed in connection with the Metro Traffic re-engineering after the cease-use date ( i.e., the day we exited the facilities).

The savings generated by the restructuring programs were partially offset by specific strategic investments, including: strengthening our sales force in the Network Radio and Metro Traffic segments, new programming, digital and systems infrastructure, television inventory outlays and incremental costs related to our TrafficLand License Agreement (as described in more detail below in “Investments”), and expenses under the Company’s distribution arrangement with CBS Radio, which partly resulted from increased clearance levels by CBS Radio.

Twelve Months Ended December 31, 2010 Compared with the Periods April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009

Revenue

Revenue presented by operating segment for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 is as follows:

		Revenue
											Predecessor
											Company
		Successor Company									For the Period				Twelve
		Twelve Months Ended				For the Period April 24					January 1 to				Month
		December 31, 2010				to December 31, 2009					April 23, 2009				Change
Network Radio		$	196,986			$	119,852				$	63,995			$	13,139
Metro Traffic			165,560				109,008					47,479				9,073
Total (1)		$	362,546			$	228,860				$	111,474			$	22,212

For the twelve months ended December 31, 2010, revenue increased $22,212, or 6.5%, to $362,546 compared with the results for the twelve months ended December 31, 2009. The increase is the result of higher revenue in both segments of our business.

For the twelve months ended December 31, 2010, Network Radio revenue was $196,986, an increase of 7.1%, or $13,139 compared with the twelve months ended December 31, 2009. The increase resulted from increased advertising revenue in programming for sports of $12,716, music of $2,404 and news of $1,812. These increases were partially offset by decreases in advertising revenue from our talk radio programs of $2,374 and from the cancellation of certain talk programs of $1,665.

Metro Traffic revenue for the twelve months ended December 31, 2010 increased $9,073, or 5.8%, to $165,560 compared with the twelve months ended December 31, 2009. The increase in Metro Traffic revenue was principally related to an increase in the Metro Traffic radio advertising revenue of $10,968, primarily due to increases in the sectors of financial services of $7,195, quick service restaurants of $3,057, retail of $2,563 and automotive of $2,313, partially offset by decreases in the sectors of travel and entertainment of $2,611, home improvement services of $1,577 and telecommunication services of $1,386. Such increase was offset by a decrease in Metro Television advertising revenue of $1,835, or 4.9%.

Operating Costs

Operating costs for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 are as follows:

		Operating Costs
											Predecessor
											Company
		Successor Company									For the Period				Twelve
		Twelve Months Ended				For the Period April 24					January 1 to				Month
		December 31, 2010				to December 31, 2009					April 23, 2009				Change
Programming and operating		$	123,569			$	79,277				$	40,854			$	(3,438	)
Station compensation			95,533				55,402					29,951				(10,180	)
Payroll and payroll related			84,859				51,703					26,576				(6,580	)
Other operating expenses			38,297				24,423					13,928				54
		$	342,258			$	210,805				$	111,309			$	(20,144	)

Operating costs increased $20,144, or 6.3 %, to $342,258 for the twelve months ended December 31, 2010 compared to the same period in 2009.

Programming and operating costs increased $3,438 for the twelve months ended December 31, 2010 compared to the same period in 2009, primarily due to increases in program commissions of $7,586 and broadcast rights of $3,751, partially offset by decreases in aviation expense of $3,290, news service fees of $2,025, talent fees of $1,584 and other production expenses of $999.

Station compensation costs, which represent costs associated with acquiring radio and television station inventory to support revenue, increased $10,180 for the twelve months ended December 31, 2010 compared to the same period in 2009, primarily as a result of increased inventory purchases from television and local radio stations in the amount of $8,819 and other station compensation costs of $1,361.

Payroll and payroll related costs increased $6,580 for the twelve months ended December 31, 2010 compared to the same period in 2009. The increases were primarily a result of sales commissions of $3,503 and other compensation of $2,902, reflecting additional sales force hires in 2010 and variable compensation tied to revenue, which were partially offset by the cost savings in payroll resulting from our 2009 re-engineering and cost reduction programs.

Other operating expenses decreased $54 for the twelve months ended December 31, 2010 compared to the same period in 2009, primarily from lower facility expenses of $1,134 and professional fees of $580, partially offset by an increase in travel and promotion expenses of $1,400.

Depreciation and Amortization

Depreciation and amortization decreased $5,815, or 24.2%, to $18,243 in the twelve months ended December 31, 2010 from the comparable period of 2009. The decrease is primarily attributable to the amortization expense in 2009 from insertion orders of $8,400 and amortization of other intangibles prior to the Refinancing of $231 (which has no counterpart in the 2010 results) and slightly lower depreciation of property and equipment of $705. These decreases were partially offset by increases in amortization of $3,290 recorded as a result of the Refinancing and our application of “push down” acquisition accounting and the amortization of intangibles of $459 related to the acquisition of Sigalert.

Corporate General and Administrative Expenses

Corporate, general and administrative expenses decreased $1,548 or 10.4%, to $13,369 for the twelve months ended December 31, 2010 compared to the twelve months ended December 31, 2009. The decrease is principally due to decreases in equity-based compensation expense of $1,860 and the absence of $1,652 of asset write-offs that occurred in the fourth quarter of 2009, partially offset by increases in payroll and related expenses of $1,519 professional services fees of $613.

Restructuring Charges

During the twelve months ended December 31, 2010, we recorded $2,899 for restructuring charges. For the twelve months ended December 31, 2010, restructuring charges included Metro Traffic re-engineering costs for real estate expenses of $1,514 (including $1,162 from revisions to estimated cash flows from our closed facilities, including estimates for subleases), severance of $1,288 (including $1,198 for the 2010 Program) and $97 for contract terminations.

In connection with the Metro Traffic re-engineering and other cost reductions, which included the consolidation of leased offices, staff reductions and the elimination of underperforming programming, that commenced in the last half of 2008, we recorded $3,976 in restructuring charges for the period from April 24, 2009 to December 31, 2009 and $3,976 for the period from January 1, 2009 to April 23, 2009.

Special Charges

We incurred special charges aggregating $7,816 in the twelve months ended December 31, 2010. Special charges in 2010 included fees of $2,414 related to our debt agreements, including the cost to twice amend our Securities Purchase Agreement and Credit Agreement; $1,500 for the estimated cost of settlement of the lawsuit filed by Triangle (see Note 18 Commitments and Contingencies for additional information) ; professional fees of $1,339 related to the evaluation of potential business development activities, including acquisitions and dispositions; Gores and Glendon fees of $1,009; and employment claim settlements of $493 related to employee terminations that occurred prior to 2008. There were no similar charges for the foregoing cost in the twelve months ended December 31, 2009. Special charges in 2010 also included: fees of $547 primarily related to regionalization costs (a decrease of $92 compared to the twelve months of 2009); asset write-downs of $321 associated with the TrafficLand arrangement (a decrease of $1,531 compared to the twelve months of 2009); and fees of $193 related to the finalization of the income tax treatment of the Refinancing, a decrease of $13,702 when compared to the fees incurred in connection with the Refinancing for the twelve months of 2009. Such Refinancing fees included transaction fees and expenses related to the negotiation of definitive documentation and fees of various legal and financial advisors and other professionals involved in the Refinancing.

Goodwill and Intangible Asset Impairment

During the third quarter of 2009, we incurred a goodwill impairment charge in our Metro Traffic segment of $50,401 as a result of a continued decline in our operating performance.

Operating Loss

The operating loss for the twelve months ended December 31, 2010 decreased by $75,542 to $22,039 from the same period in 2009. This decrease is primarily attributable to a decrease in goodwill and intangible asset impairment of $50,501, lower restructuring and special charges of $15,610, lower depreciation and amortization of $5,815, an increase in Network Radio OIBDA of $3,118 and lower corporate expense of $1,184, partially offset by a decrease in Metro Traffic OIBDA of $686.

OIBDA

Beginning with the first quarter of 2010, we changed how we evaluate segment performance and now use segment revenue and segment operating (loss) income before depreciation and amortization (“OIBDA”) as the primary measure of profit and loss for our operating segments in accordance with FASB guidance for segment reporting. We have reflected this change in all periods presented in this report. We believe the presentation of OIBDA is relevant and useful for investors because it allows investors to view the performance of each of our operating segments in a manner similar to the primary method used by our management and enhances their ability to understand our operating performance.

OIBDA for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 are as follows:

		OIBDA
											Predecessor
											Company
		Successor Company									For the Period				Twelve
		Twelve Months Ended				For the Period April 24					January 1 to				Month
		December 31, 2010				to December 31, 2009					April 23, 2009				Change
Network Radio — OIBDA		$	12,147			$	9,602				$	(573	)		$	3,118
Metro Traffic — OIBDA			4,205				5,504					(613	)			(686	)
Corporate expenses			(9,433	)			(7,449	)				(3,168	)			1,184
Goodwill and intangible asset impairment			—				(50,501	)				—				50,501
Restructuring and special charges			(10,715	)			(9,530	)				(16,795	)			15,610
OIBDA			(3,796	)			(52,374	)				(21,149	)			69,727
Depreciation and amortization			18,243				21,474					2,584				(5,815	)
Operating loss		$	(22,039	)		$	(73,848	)			$	(23,733	)		$	75,542

OIBDA was a loss of $3,796 for the twelve months ended December 31, 2010 a decrease of $69,727 from a loss for the same period in 2009. This decrease in OIBDA loss is primarily attributable to a decrease in goodwill and intangible asset impairment of $50,501, lower restructuring and special charges of $15,610, an increase in Network Radio OIBDA of $3,118 and a decrease in corporate expense of $1,184, partially offset by a decrease in Metro Traffic OIBDA of $686.

Network Radio

OIBDA in our Network Radio segment increased by $3,118 to $12,147 in 2010 compared to the same period in 2009. The increase in OIBDA was due to an increase in revenue of $13,139 and a decrease in programming and operating expenses for content agreements of $1,635, talent expense of $1,584 and producer expenses of $692; and a decrease in station compensation expense of $390. These increases in OIBDA were partially offset by increases in costs for the programming and operating expenses for program commissions and broadcast rights of $10,977 (for sports and music programs and broadcasts), payroll and payroll-related costs of $1,791 and other operating expenses of $1,554.

Metro Traffic

OIBDA in our Metro Traffic segment decreased $686 to $4,205 in 2010 compared to the same period in 2009. The decrease was primarily due increased station compensation costs of $10,570 (resulting from cash buys for television and local radio inventory of $8,819 and other station compensation of $1,751) and payroll and payroll-related expenses of $4,789. The decrease was partially offset by an increase in revenue of $9,073 and by decreases in programming and operating costs of $3,862 (primarily aviation costs of $3,290) and other operating costs of $1,738 (primarily facility costs of $1,590).

Interest Expense

Interest expense increased $5,248, or 29.1%, to $23,251 in the twelve months ended December 31, 2010 from the comparable period of 2009. The increase is primarily attributable to the increase in costs related to the amendments to the Securities Purchase Agreements of $2,648, a higher rate of interest on a slightly lower average level of long-term debt outstanding of $1,759, primarily as a result of the Refinancing, and increased interest related to the Culver City financing of $679.

Other Expense

Other expense in the twelve months ended December 31, 2010 was $1,688 which primarily represents the fair market value adjustment related to the February 2011 Gores equity commitment of $1,538, a loss on the disposal of long-lived assets of $258 and the gain on sale of marketable securities in the fourth quarter of $98. The February 2011 Gores equity commitment constituted an embedded derivative and is valued in accordance with derivative accounting (see Note 8 — Debt for additional detail).

Provision for Income Taxes

Income tax benefit for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 were $15,721, $25,025 and $7,635, respectively. Our effective tax rate for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 were 33.5%, 28.2% and 28.7%, respectively. Our effective tax rate for 2009 was affected by the goodwill impairment charges, which for were substantially non-deductible for tax purposes. The 2009 effective rates were also lower due to certain special charges and restructuring charges. An additional tax benefit of $590 was recorded in the twelve months ended December 31, 2010 related to an increase in our federal income tax refund arising from a change in the determination of the deductibility of certain costs for the twelve months ended December 31, 2009. These additional income tax benefits are primarily related to deductions taken in U.S. federal filings for which it is more likely than not that those deductions would be sustained on their technical merits.

Net Loss

Our net loss for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 were $31,257, $63,600 and $18,961, respectively. Net loss per share attributable to common shareholders for basic and diluted shares for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 were $(1.50), $(11.75) and $(43.64), respectively. Net loss per share amounts reflected the effect of the 200-for-1 reverse stock split of our common stock that occurred on August 3, 2009. Average share amounts for the April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 periods were significantly lower than the year ended December 31, 2010 as a result of the conversions of shares of preferred stock into common stock in July and August 2009.

The Periods April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009
Compared With Twelve Months Ended December 31, 2008

Revenue

Revenue for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 and the twelve months ending December 31, 2008 are as follows:

		Revenue
		Successor Company					Predecessor Company
		For the Period					For the Period								Twelve
		April 24 to					January 1 to				Twelve Months Ended				Month
		December 31, 2009					April 23, 2009				December 31, 2008				Change
Network Radio		$	119,852				$	63,995			$	209,532			$	(25,685	)
Metro Traffic			109,008					47,479				194,884				(38,397	)
Total (1)		$	228,860				$	111,474			$	404,416			$	(64,082	)

Revenue for twelve months ended December 31, 2009 decreased $64,082, or 15.8%, from $404,416 for the twelve months ended December 31, 2008. The decrease in 2009 was principally attributable to the ongoing economic downturn and, in particular, the general decline in advertising spending, which started to contract in the second half of 2008 and continued in 2009. Revenue for all periods was adversely affected by increased competition and lower audience levels.

For the twelve months ended December 31, 2009, Network Radio revenue decreased $25,685, compared to $209,532 for the twelve months ended December 31, 2008, a 12.3% decline. The declines in 2009 were primarily the result of the cancellation of certain programs of $8,619, absence of the summer Olympics of $1,286 declines in audience, lower revenue from our RADAR network inventory and the general decline in advertising spending which began to contract in 2008 and continued throughout much of 2009 that affected our programming for news $10,407, sports of $3,211 and music of $2,536.

For the twelve months ended December 31, 2009, Metro Traffic revenue decreased $38,397, a decline of 19.7%, from $194,884 for the twelve months ended December 31, 2008. The 2009 decrease is principally related to a weak local advertising marketplace spanning various sectors and categories including retail of $6,657, automotive of $5,942, quick serve restaurants of $3,427, communications and advertising of $5,171, financial services of $3,738 and travel and entertainment of $1,997, which placed an overall downward pressure on advertising sales and rates.

Expenses

Operating costs

Operating costs for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 and the twelve months ending December 31, 2008 are as follows:

		Operating Costs
		Successor Company					Predecessor Company
		For the Period					For the Period								Twelve
		April 24 to					January 1 to				Twelve Months Ended				Month
		December 31, 2009					April 23, 2009				December 31, 2008				Change
Programming and operating		$	79,277				$	40,854			$	139,886			$	19,755
Station compensation			55,402					29,951				82,015				(3,338	)
Payroll and payroll related			51,703					26,576				98,645				20,366
Other operating expenses			24,423					13,928				37,381				(970	)
		$	210,805				$	111,309			$	357,927			$	35,813

For the twelve months ended December 31, 2009, operating costs decreased $35,813, or 10.0%, from $357,927 for the twelve months ended December 31, 2008. The decrease reflects the benefit of the Metro Traffic re-engineering and cost reduction programs, which began in the last half of 2008 and continued through 2009, and which were partially offset by increases in TV inventory purchases of $4,848 that are included in station compensation costs.

For the twelve months ended December 31, 2009, programming and operating costs decreased by $19,755 compared to $139,886 for the twelve months ended December 31, 2008, primarily due to lower aviation expense $5,851, talent fees of $4,037 and reduced revenue sharing expense from broadcast rights of $3,929 and program commissions of $6,245 as a result of our lower revenue.

For the twelve months ended December 31, 2009, station compensation expense increased by $3,338 compared to $82,015 for the twelve months ended December 31, 2008, primarily due to increases in TV inventory purchases of $4,848, partially offset by decreases in certain affiliate costs of $1,510, primarily from the renegotiation and cancellation of certain affiliate arrangements.

For the twelve months ended December 31, 2009, payroll and payroll related costs decreased $20,366 or 20.6% compared to $98,645 for the twelve months ended December 31, 2008, as a result of the salary reductions and decreased headcount of approximately 8%.

For the twelve months ended December 31, 2009, other operating expenses increased $970 compared to $37,381 for the twelve months ended December 31, 2008, reflecting a 2009 asset write-off of $1,652 and increased accounting and audit fees of $609, partially offset by the benefit of the Metro Traffic re-engineering program, primarily related to facilities of $1,501.

Depreciation and Amortization

Depreciation and amortization for the twelve months ended December 31, 2009 increased $13,006, or 118%, compared to $11,052 for the twelve months ended December 31, 2008. The increase is primarily attributable to the increase in amortization expense of $14,736 from the fair value of amortizable intangibles that were recorded as a result of the Refinancing and our application of push down acquisition accounting and by increased depreciation and amortization from our additional investments in systems and infrastructure of $440. This was partially offset by a decrease in warrant amortization expense of $1,618 as a result of the cancellation on March 3, 2008 of all outstanding warrants previously granted to CBS Radio and lower amortization from predecessor period intangible assets of $552.

Corporate General and Administrative Expenses

Corporate, general and administrative expenses decreased $1,090 for the twelve months ended December 31, 2009 as compared to $16,007 for the twelve months ended December 31, 2008. The decrease is due to reduced legal fees for normal operations of $949 and reduced consulting fees of $767, partially offset by increases in accounting and auditing fees of $609.

Goodwill and Intangible Asset Impairment

In September 2009, a triggering event occurred as a result of updated forecasted results for 2009 and 2010, and therefore, we conducted impairment tests. The results indicated impairment in our Metro Traffic segment. As a result of the analysis, we recorded an impairment charge of $50,401 to Metro Traffic goodwill and $100 to Metro Traffic’s trademarks.

Restructuring Charges

In connection with the Metro Traffic re-engineering and other cost reductions, which included the consolidation of leased offices, staff reductions and the elimination of underperforming programming that commenced in the last half of 2008. Restructuring charges decreased $6,148 for the twelve months ended December 31, 2009 as compared to $14,100 for the twelve months ended December 31, 2008 as a result of decreased contract terminations of $6,354 and decreased severance costs of $3,166, partially offset by increased facilities costs of $3,372. The charges for the twelve months ended December 31, 2008 included severance of $6,765, contract terminations of $6,504 and the consolidation of leased offices of $831.

Special Charges

Special charges for the period from April 24, 2009 to December 31, 2009 included: Refinancing costs of $1,196, including transaction fees and expenses related to negotiation of the definitive documentation, fees of various legal and financial advisors for the constituents involved in the Refinancing ( e.g., Westwood One, Gores, Glendon Partners, the banks, noteholders and the lenders of the Senior Credit Facility); asset write-down associated with the TrafficLand arrangement of $1,852; professional fees and other costs related to the S-1 stock offering that we currently have no immediate plans to further pursue of $1,698; and costs related to the regionalization program, Culver City financing costs and costs associated with the acquisition of Jaytu (d/b/a Sigalert) totaling $808.

Special charges for the period from January 1, 2009 to April 23, 2009 included: Refinancing costs of $12,699, including transaction fees and expenses related to negotiation of the definitive documentation, fees of various legal and financial advisors for the constituents involved in the Refinancing ( e.g., Westwood One, Gores, Glendon Partners, the banks, noteholders and the lenders of the Senior Credit Facility); and costs related to the regionalization program of $120.

Special charges for the period from April 24, 2009 to December 31, 2009 and for the period from January 1, 2009 to April 23, 2009 had no corresponding charges in the comparable twelve month period in 2008.

Special charges for 2008 consisted of associated legal and professional fees of $6,624 incurred in connection with the new CBS arrangement, contract termination costs of $5,000, and re-engineering expenses of $1,621.

Operating Loss

The operating loss for the twelve months ended December 31, 2009 decreased by $340,460 from $438,041 for the same period in 2008. This decrease is primarily due to the higher goodwill impairment charges in 2008 of $430,126 versus the goodwill impairment charge of $50,401 in 2009, partially offset by the decline in OIBDA in the Metro Traffic of $25,806 and Network Radio of $9,019 and higher depreciation and amortization of $13,006 as noted above.

OIBDA

OIBDA for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 and the twelve months ending December 31, 2008 are as follows:

		OIBDA
		Successor Company					Predecessor Company
		For the Period					For the Period								Twelve
		April 24 to					January 1 to				Twelve Months Ended				Month
		December 31, 2009					April 23, 2009				December 31, 2008				Change
Network Radio — OIBDA		$	9,602				$	(573	)		$	18,048			$	(9,019	)
Metro Traffic — OIBDA			5,504					(613	)			30,697				(25,806	)
Corporate expenses			(7,449	)				(3,168	)			(18,263	)			7,646
Goodwill and intangible asset impairment			(50,501	)				—				(430,126	)			379,625
Restructuring and special charges			(9,530	)				(16,795	)			(27,345	)			1,020
OIBDA			(52,374	)				(21,149	)			(426,989	)			353,466
Depreciation and amortization			21,474					2,584				11,052				13,006
Operating loss		$	(73,848	)			$	(23,733	)		$	(438,041	)		$	340,460

OIBDA loss for the twelve months ended December 31, 2009 decreased $353,466 from the twelve months ended December 31, 2008 due primarily to the higher goodwill impairment charges in 2008 of $430,126 versus the goodwill impairment charge of $50,401 in the third quarter of 2009. The decline in OIBDA between 2009 and 2008, absent the goodwill impairment charge, is primarily related to a weak advertising marketplace spanning various sectors and categories including automotive, retail and telecommunications, which placed an overall downward pressure on advertising sales and rates. The decline in revenue was partially offset by the realignment of our cost base, net of restructuring charges, which actions were taken as part of our Metro Traffic re-engineering and other reduction initiatives.

Network Radio

OIBDA in our Network Radio segment decreased by $9,019 for the twelve months ended December 31, 2009 compared to the twelve months ended December 31, 2008 of $18,048. The decrease was due to lower revenue of $25,685 and higher accounting and audit fees of $1,452. These expense increases were partially offset by decreases in salary and related costs of $3,458, program commissions of $6,245, talent costs of $4,037, broadcast rights of $3,929 and CBS fees of $2,583. We allocate certain operating costs to each segment. During 2009, we refined our allocation of accounting and auditing fees to the Network Radio segment, which resulted in an increase of expense for the Network Radio segment in 2009 of $1,452 compared to 2008. Our total accounting and audit fees increased by $609 during 2009.

Metro Traffic

OIBDA in our Metro Traffic segment decreased by $25,806 for the twelve months ended December 31, 2009 compared to the twelve months ended December 31, 2008 of $30,697, primarily due to lower revenue of $38,397 and higher program and operating costs, primarily television inventory purchases, of $9,299. These increases were partially offset by reductions in the following areas: salaries and related expenses of $13,223, aviation expense of $5,818, station compensation of $1,913 and rent of $1,455, as well as, a general decrease in other operating expenses due to cost saving measures. We allocate certain operating costs to each segment. During 2009, we refined our allocation of accounting and auditing fees to the Metro Traffic segment, which resulted in an increase of expense for the Metro Traffic segment in 2009 of $1,394 compared to 2008. Our total accounting and audit fees increased by $609 during 2009.

Interest Expense

Interest expense increased $1,353, or 8%, for the twelve months ended December 31, 2009 from $16,651 in the comparable period of 2008. The increase reflects higher average interest rates on the Senior Notes and Senior Credit Facility, partially offset by the lower average debt levels during 2009 as a result of our Refinancing that closed on April 23, 2009. As a result of our Refinancing, the interest payments on our debt on an annualized basis ( i.e. , from April 23, 2009 to April 23, 2010 and subsequent annual periods thereafter) increased from approximately $12,000 to $19,000, $6,000 of which will be PIK (such interest accrues on a quarterly basis and is added to the principal amount of our debt). The increase was partially offset by a one-time reversal of interest expense in 2009 from the settlement of an amount owed to a former employee of $754.

Other (Income) Expense

Other income decreased $12,005 for the twelve months ended December 31, 2009 to compared to $12,369 in 2008 principally due to a 2008 gain on the sale of securities of $12,420.

Provision for Income Taxes

Income tax benefits for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 and for the twelve months ended December 31, 2008 were $25,025, $7,635 and $14,760, respectively. Income tax benefit for the twelve months ended December 31, 2009 increased $17,900, or 121%, from $14,760 for the twelve months ended December 31, 2008, primarily due to the operating loss and higher deductible expenses in 2009. Our effective 2009 income tax rates was impacted by the 2009 goodwill impairment charge, which for the most part was substantially non-deductible for tax purposes. The effective 2008 income tax rate was impacted by the 2008 goodwill impairment charge, which was substantially non-deductible for tax purposes.

Our effective tax rate for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 and the twelve months ended December 31, 2008 were 28.2%, 28.7% and 3.3%, respectively. The change in the effective tax rate is the result of large non-deductible expenses in 2008 for goodwill impairments, compared to a smaller impairment in 2009 and other items.

Net Loss

Our net losses for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 and for the twelve months ended December 31, 2008 were $63,600, $18,961 and $427,563. The decrease for the twelve months ended December 31, 2009 of $345,002 from a net loss of $427,563 in the comparable period of 2008, was primarily attributable to the decrease in charges for goodwill and intangible impairment of $379,625. Net losses per share attributable to common shareholders for basic and diluted shares was $(11.75), $(43.64) and $(878.73), respectively. Average share amounts for the April 24, 2009 to December 31, 2009 period were significantly higher than the January 1, 2009 to April 23, 2009 period and the twelve months ended December 31, 2008 as a result of the conversions of shares of preferred stock into common stock in July and August 2009. Net loss per share amounts reflected the effect of the 200-for-1 reverse stock split of our common stock that occurred on August 3, 2009.

Liquidity, Cash Flow and Debt

Cash flows for the twelve months ended December 31, 2010 and for the periods from April 24, 2009 to December 31, 2009 and January 1, 2009 to April 23, 2009 are as follows:

		Cash Flow
											Predecessor
											Company
		Successor Company									For the Period				Twelve
		Twelve Months Ended				For the Period April 24					January 1 to				Month
		December 31, 2010				to December 31, 2009					April 23, 2009				Change
Net cash provided by (used in) operating activities		$	8,136			$	(24,142	)			$	(777	)		$	33,055
Net cash used in investing activities			(7,957	)			(6,434	)				(1,384	)			(139	)
Net cash (used in) provided by financing activities			(2,065	)			31,395					(271	)			(33,189	)
Net (decrease) increase in cash and cash equivalents			(1,886	)			819					(2,432	)		$	(273	)
Cash and cash equivalents, beginning of period			4,824				4,005					6,437
Cash and cash equivalents, end of period		$	2,938			$	4,824				$	4,005

Net cash provided by operating activities was $8,136 for the twelve months ended December 31, 2010 an increase of $33,055 compared to the twelve months ended December 31, 2009. The increase was principally attributable to an increase in the change in accounts payable, accrued liabilities and amounts payable to related parties of $21,536, a lower net decrease in our deferred taxes of $14,453, a 2010 federal tax refund of $12,940 in 2010, a lower net loss of $51,304 (primarily from the absence of the 2009 impairment charge of $50,501), a decrease in the change in prepaid and other assets of $4,154 and an increase in the change in deferred revenue of $1,769. These items were partially offset by an increase in the change in accounts receivable of $15,694, lower other non-cash adjustments of $6,698 and a decrease in the change in taxes payable of $208.

While our business at times does not require significant cash outlays for capital expenditures, capital expenditures for the twelve months ended December 31, 2010 increased $2,275 to $8,843, compared to the twelve months ended December 31, 2009, primarily as a result of payments related to investment in internal use software we installed. In the fourth quarter of 2010, we received proceeds from the sale of marketable securities of $886.

Cash used in financing activities was $2,065 for the twelve months ended December 31, 2010, a decrease of $33,189 compared to the twelve months ended December 31, 2009. As part of the Securities Purchase Agreement amendments, we paid down our Senior Notes by $16,032 during 2010. We borrowed $10,000 under our revolving credit facility during 2010, received $5,000 in proceeds from the issuance of common stock to Gores and paid $1,033 under our capital leases. During the period from April 24, 2009 to December 31, 2009, we received $20,000 in proceeds from a term loan, $25,000 from the issuance of preferred stock to Gores and $6,998 from the Culver City building financing, all of which were partially offset by a repayment of the old senior debt of $25,000, repayment of the revolving credit facility of $11,000 and payments of $603 under our capital leases. During the period from January 1, 2009 to April 23, 2009, we paid $271 under our capital leases.

Liquidity and Capital Resources

We continually project anticipated cash requirements, which may include requirements for potential M&A activity, capital expenditures, principal and interest payments on our outstanding indebtedness, dividends and working capital requirements. To date, funding requirements have been financed through cash flows from operations, the issuance of equity to Gores and the issuance of long-term debt.

At December 31, 2010, our principal sources of liquidity were our cash and cash equivalents of $2,938 and borrowing availability of $3,781 under our revolving credit facility, which equaled $6,719 in total liquidity. Cash flow from operations is also a principal source of funds. We have experienced significant operating losses since 2005 as a result of increased competition in our local and regional markets, reductions in national audience levels, and reductions in our local and regional sales force, and more recently, as a result of higher programming fees and station compensation costs. As described in more detail below, as a result of our waiver and fourth amendment to our debt agreements entered into on April 12, 2011 and based on our 2011 projections, which we believe use reasonable assumptions regarding the current economic environment, we estimate that cash flows from operations will be sufficient to fund our cash requirements, including scheduled interest and required principal payments on our outstanding indebtedness and projected working capital needs, and provide us sufficient Adjusted EBITDA to comply with our amended debt covenants for at least the next 12 months.

Our Senior Credit Facility and Senior Notes mature on July 15, 2012. If we are unable to meet our debt service and repayment obligations under the Senior Notes or the Senior Credit Facility, we would be in default under the terms of the agreements governing our debt, which if uncured, would allow our creditors at that time to declare all outstanding indebtedness to be due and payable and materially impair our financial condition and liquidity. If financing is limited or unavailable to us upon the maturity of the Senior Credit Facility and Senior Notes, the Company may not have the financial means be able to repay the debt, which would have a material adverse effect on our business continuity, our financial condition and our results of operations.

Existing Indebtedness

Our existing debt totaling $146,629 consists of: $111,629 under the Senior Notes maturing July 15, 2012 (which includes $10,222 due to Gores) and the Senior Credit Facility, consisting of a $20,000 unsecured, non-amortizing term loan and $15,000 outstanding under our revolving credit facility as of March 31, 2011. The term loan and revolving credit facility (i.e., the “Senior Credit Facility”) mature on July 15, 2012 and are guaranteed by subsidiaries of the Company and Gores. The Senior Notes bear interest at 15.0% per annum, payable 10% in cash and 5% PIK interest. The PIK interest accretes and is added to principal quarterly, but is not payable until maturity. As of December 31, 2010, the accrued PIK interest was $10,161. As a result of the waiver and fourth amendments to the debt agreements we entered into on April 12, 2011, a 5% leverage fee will be imposed effective October 1, 2011 , subject to the potential elimination of such as described below. The 5% leverage fee will be equal to 5% of the Senior Notes outstanding for the period beginning October 1, 2011, and shall accrue on a daily basis from such date until the fee amount is paid in full. The fee shall be payable on the earlier of maturity (July 15, 2012) or the date on which the Senior Notes are paid. Accrued and unpaid leverage fee amounts shall be added to the principal amount of the Senior Notes at the end of each calendar quarter (as is the case with PIK interest on the Senior Notes which accretes to the principal amount). The Senior Notes may be prepaid at any time, in whole or in part, without premium or penalty. Payment of the Senior Notes is mandatory upon, among other things, certain asset sales and the occurrence of a “change of control” (as such term is defined in the Securities Purchase Agreement governing the Senior Notes). The Senior Notes are guaranteed by the subsidiaries of the Company and are secured by a first priority lien on substantially all of the Company’s assets. Effective as of the date of the waiver and fourth amendments to the credit agreements, the Senior Notes held by Gores were fully subordinated to the Senior Notes held by non-Gores holders, including in connection with any future pay down of Senior Notes from the proceeds of any asset sale. Notwithstanding the foregoing, if at any time, the Company provides satisfactory documentation to its lenders that its debt leverage ratio for any LTM period complies with the following debt covenant levels for the five quarters beginning on June 30, 2011: 5.00, 5.00, 4.50, 3.50 and 3.50, and provided more than 50% of the outstanding amount of non-Gores Senior Notes (i.e., Senior Notes held by the non-Gores holders) shall have been repaid as of such date, then the 5% leverage fee would be eliminated on a prospective basis. The foregoing levels represent the same covenant levels set forth in the Second Amendment to the Securities Purchase Agreement entered into on March 30, 2010, except that the debt covenant level for June 30, 2011 was 5.50 in the Second Amendment. As part of the waiver and fourth amendment, the Company agreed it would need to comply with a 5.00 covenant level on June 30, 2011, on an LTM basis, for the 5% leverage fee to be eliminated.

Loans under our existing Credit Agreement (which govern the Senior Credit Facility) bear interest at our option at either LIBOR plus 4.5% per annum (with a LIBOR floor of 2.5%) or a base rate plus 4.5% per annum (with a base rate floor of the greater of 3.75% and the one-month LIBOR rate).

Both the Securities Purchase Agreement (governing the Senior Notes) and Credit Agreement (governing the Senior Credit Facility) contain restrictive covenants that, among other things, limit our ability to incur debt, incur liens, make investments, make capital expenditures, consummate acquisitions, pay dividends, sell assets and enter into mergers and similar transactions beyond specified baskets and identified carve-outs. Additionally, we may not exceed the maximum senior leverage ratio (the principal amount outstanding under the Senior Notes over our Adjusted EBITDA) referred to in this report as our debt leverage covenant. The Securities Purchase Agreement contains customary representations and warranties and affirmative covenants. The Credit Agreement contains substantially identical restrictive covenants (including a maximum senior leverage ratio calculated in the same manner as with the Securities Purchase Agreement), affirmative covenants and representations and warranties like those found in the Securities Purchase Agreement, modified, in the case of certain covenants, for a cushion on basket amounts and covenant levels from those contained in the Securities Purchase Agreement.

Since the time of our Refinancing, we have entered into four amendments to our debt agreements with our lenders (on October 14, 2009, March 30, 2010, August 17, 2010 and most recently, April 12, 2011). In each case, our underperformance against our financial projections caused us to reduce our forecasted results. With the exception of our revised projections at the time of our October 2009 amendment and at the time of our April 2011 amendment (where we requested and received a waiver of our debt leverage covenants to be measured on December 31, 2009 and March 31, 2011, respectively, on a trailing four-quarter basis), our projections have indicated that we would attain sufficient Adjusted EBITDA to comply with the debt leverage covenants then in place. Notwithstanding this, in both of the 2010 amendments, management did not believe there was sufficient cushion in our projections of Adjusted EBITDA to predict with any certainty that we would satisfy such covenants given the unpredictability in the economy and our business. Additionally, given our constrained liquidity on June 30, 2010 and our revised projections in place at such time, management believed it was prudent to renegotiate amendments to our debt agreements to enhance our available liquidity in addition to modifying our debt leverage covenants. These negotiations resulted in the August 17, 2010 amendment in which Gores agreed to purchase an additional $15,000 of common stock. As a result thereof, 769,231 shares were issued to Gores on September 7, 2010 for approximately $5,000 and 1,186,240 shares were issued to Gores on February 28, 2011 for approximately $10,000. Because the $10,000 investment by Gores was to be made based on a trailing 30-day weighted average of our common stock’s closing share price for the 30 consecutive days ending on the tenth day immediately preceding the date of the stock purchase, and additionally included a collar (e.g., a $4.00 per share minimum and a $9.00 per share maximum price), the Gores $10,000 equity commitment was deemed to contain embedded features having the characteristics of a derivative to be settled in our common stock. Accordingly, pursuant to authoritative guidance, we determined the fair value of this derivative by applying the Black-Scholes model using the Monte Carlo simulation to estimate the price of our common stock on the derivative’s expiration date and estimated the expected volatility of the derivative by using the aforementioned trailing 30-day weighted average. On August 17, 2010, we recorded an asset of $442 related to the aforementioned $10,000 Gores equity commitment. On December 31, 2010, the fair market value of such Gores equity commitment was a liability of $1,096 resulting in other expense of $1,538 for the year ended December 31, 2010. The derivative expired on February 28, 2011, the date Gores satisfied the $10,000 Gores equity commitment by purchasing 1,186,240 shares of common stock at a per share price of $8.43, calculated in accordance with the trailing 30-day weighted average of our common stock’s closing price as described above. We accrued additional fees of $2,433 related to amending our credit agreements in the year ended December 31, 2010 recorded as interest expense.

As a result of the most recent amendments to our principal debt agreement, the waiver and fourth amendment to the Securities Purchase Agreement entered into on April 12, 2011, our previously existing maximum senior leverage ratios (expressed as the principal amount of Senior Notes over our Adjusted EBITDA (as defined in our lender agreements) measured on a trailing, four-quarter basis) of 11.25, 11.0 and 10.0 times for the first three quarters of 2011 were replaced by a covenant waiver for the first quarter of 2011 and minimum LTM EBITDA thresholds of $4,000 and $7,000 respectively, for the second and third quarters of 2011. Debt leverage covenants for the last quarter of 2011 and the first two quarters in 2012 (the Senior Notes mature on July 15, 2012) remain unchanged. The quarterly debt leverage covenants that appear in the Credit Agreement (governing the Senior Credit Facility) were also amended to reflect a change to minimum LTM EBITDA thresholds and maintain the additional 15% cushion that exists between the debt leverage covenants applicable to the Senior Credit Facility and the corresponding covenants applicable to the Senior Notes. By way of example, the minimum LTM EBITDA thresholds of $4,000 and $7,000 for the second and third quarters of 2011 in the Securities Purchase Agreement (applicable to the Senior Notes) are $3,400 and $5,950, respectively, in the Credit Agreement (governing the Senior Credit Facility). The Senior Notes held by Gores were also subordinated to the Senior Notes held by non-Gores holders, effective October 1, 2011, a 5% leverage fee will be imposed and we agreed to report the status of any M&A discussions/activity on a bi-weekly basis. As noted above, if at any time, we provide satisfactory documentation to our lenders that our debt leverage ratio for any LTM period complies with the following debt covenant levels for the five quarters beginning on June 30, 2011: 5.00, 5.00, 4.50, 3.50 and 3.50, and provided more than 50% of the outstanding amount of non-Gores Senior Notes (i.e., Senior Notes held by the non-Gores holders) shall have been repaid as of such date, then the 5% leverage fee would be eliminated on a prospective basis.

On March 31, 2010, June 4, 2010 and November 30, 2010, we repaid $3,500, $12,000 and $532, respectively, of the Senior Notes in accordance with the agreements related to our debt covenants.

Adjusted EBITDA for the nine months ended September 30, 2010 was $11,269. Under the terms of our Senior Notes, in order to have satisfied our 11.25 to 1.00 covenant for the twelve month period ended December 31, 2010, we had to realize Adjusted EBITDA (loss) for the three months ended December 31, 2010 of no more than $(1,346). For the three months ended December 31, 2010 our Adjusted EBITDA was $869, which was $2,215 in excess of the required Adjusted EBITDA. As a point of reference, our Adjusted EBITDA for the three months ended December 31, 2009 was $6,089.

•

We have obtained from our lenders a debt covenant waiver for the first quarter of 2011 and accordingly, there is no minimum LTM EBITDA threshold or debt covenant level that we must satisfy for this period.

•

In order to satisfy our minimum LTM EBITDA threshold of $4,000 for the twelve month period ending June 30, 2011, we must realize a minimum Adjusted EBITDA loss of $(1,359) for the six months ended June 30, 2011. This compares to our Adjusted EBITDA for the six months ended June 30, 2010 of $6,779. Adjusted EBITDA for the six months ended December 31, 2010 was $5,359.

•

In order to satisfy our minimum LTM EBITDA threshold of $7,000 for the twelve month period ending September 30, 2011, we must realize a minimum Adjusted EBITDA of $6,131 for the nine months ended September 30, 2011. This compares to our Adjusted EBITDA for the nine months ended September 30, 2010 of $11,269. Adjusted EBITDA for the three months ended December 31, 2010 was $869.

•

In order to satisfy our 9.00 to 1.00 covenant for the twelve month period ending December 31, 2011, we must realize a minimum Adjusted EBITDA of $13,035 for the twelve months ended December 31, 2011. This compares to our Adjusted EBITDA for the twelve months ended December 31, 2010 of $12,138.

Our minimum LTM EBITDA thresholds (for the second and third quarter of 2011) and our maximum senior leverage ratios for the last quarter of 2011 and first two quarters of 2012 (each referred to herein as our “debt leverage covenant”), defined as the principal amount of Senior Notes over our Adjusted EBITDA (defined below), are measured on a trailing, four-quarter basis. The covenants are the same under our Securities Purchase Agreement, governing the Senior Notes, and our Senior Credit Facility, governing the Senior Credit Facility, except that they have different maximum levels. We have presented the more restrictive of the two levels below.

Maximum Senior Leverage

Principal Amount of Senior Notes

Required Last Twelve Months

Ratio Covenant / Minimum

Estimated Outstanding (Includes

(LTM) Minimum Adjusted

Quarter Ending

LTM EBITDA Thresholds

PIK) *

EBITDA

12/31/2010

11.25 to 1.0

111,629

9,923

3/31/2011

Waived

113,024

Waived

6/30/2011

4,000

**

114,437

4,000

9/30/2011

7,000

**

115,868

7,000

12/31/2011

9.00 to 1.0

117,316

13,035

3/31/2012

8.00 to 1.0

118,801

14,850

6/30/2012

7.50 to 1.0

120,322

16,043

Adjusted EBITDA has the same definition in both of our borrowing agreements and means Consolidated Net Income adjusted for the following: (1) minus any net gain or plus any loss arising from the sale or other disposition of capital assets; (2) plus any provision for taxes based on income or profits; (3) plus consolidated net interest expense; (4) plus depreciation, amortization and other non-cash losses, charges or expenses (including impairment of intangible assets and goodwill); (5) minus any “extraordinary,” “unusual,” “special” or “non-recurring” earnings or gains or plus any “extraordinary,” “unusual,” “special” or “non-recurring” losses, charges or expenses; (6) plus restructuring expenses or charges; (7) plus non-cash compensation recorded from grants of stock appreciation or similar rights, stock options, restricted stock or other rights; (8) plus any Permitted Glendon/Affiliate Payments (as described below); (9) plus any Transaction Costs (as described below); (10) minus any deferred credit (or amortization of a deferred credit) arising from the acquisition of any Person; and (11) minus any other non-cash items increasing such Consolidated Net Income (including, without limitation, any write-up of assets); in each case to the extent taken into account in the determination of such Consolidated Net Income, and determined without duplication and on a consolidated basis in accordance with GAAP.

“Permitted Glendon/Affiliate Payments” means payments made at our discretion to Gores and its affiliates including Glendon Partners for consulting services provided to Westwood One and “Transaction Costs” refers to the fees, costs and expenses incurred by us in connection with the Refinancing.

Adjusted EBITDA, as we calculate it, may not be comparable to similarly titled measures employed by other companies. While Adjusted EBITDA does not necessarily represent funds available for discretionary use, and is not necessarily a measure of our ability to fund our cash needs, we use Adjusted EBITDA as defined in our lender agreements as a liquidity measure, which is different from operating cash flow, the most directly comparable financial measure calculated and presented in accordance with GAAP. We have provided below the requisite reconciliation of operating cash flow to Adjusted EBITDA.

Adjusted EBITDA for the years ended December 31, 2010, 2009 and 2008 is as follows:

		Twelve Months Ended December 31,
Adjusted EBITDA		2010				2009				2008
Net cash provided by (used in) operating activities		$	8,136			$	(24,919	)		$	2,038
Interest expense			23,251				18,003				16,651
Income taxes benefit			(15,721	)			(32,660	)			(14,760	)
Deferred taxes			17,458				31,911				13,907
Federal tax refund			(12,940	)			—				—
Special charges and other (1)			8,413				20,025				16,517
Restructuring			2,899				7,952				14,100
Paid-in-kind interest			(5,734	)			(4,427	)			—
Change in assets and liabilities			(14,333	)			(2,778	)			(6,376	)
Other non-operating income			1,688				(363	)			(998	)
Change in fair value of derivative liability			(1,538	)			—				—
Sigalert earn-out (2)			1,063				—				—
Traffic land write-down			(321	)			(1,852	)			—
Amortization of deferred financing costs			(23	)			(331	)			(1,674	)
Losses (gains) on sales of securities			98				2				(1	)
Loss on disposal of property and equipment			(258	)			(190	)			(206	)
Adjusted EBITDA		$	12,138			$	10,373			$	39,198

We did not pay dividends to our stockholders during 2010, 2009 or 2008. In May 2007, our Board elected to discontinue the payment of a dividend on our common stock. The payment of dividends on our common stock is prohibited by the terms of our Senior Notes and Senior Credit Facility. There are no plans to declare dividends on our common stock for the foreseeable future. Additionally, our Senior Credit Facility and Senior Notes contain covenants that restrict our ability to repurchase shares of our common stock.

Goodwill

The estimates and assumptions used in our impairment analysis vary between our reporting units depending on the facts and circumstances specific to each unit. We believe that the estimates and assumptions we made are reasonable, but they are susceptible to change from period to period. Actual results of operations, cash flows and other factors will likely differ from the estimates used in our valuation, and it is possible that differences and changes could be material. A deterioration in profitability, adverse market conditions and a slower or weaker economic recovery than currently estimated by management could have a significant impact on the estimated fair value of our reporting units and could result in an impairment charge in the future.

On April 1, 2011 we filed a notice of late filing on Form 12b-25 with the SEC, which estimated an impairment charge between $15,000 and $25,000 as of December 31, 2010. Subsequent to such filing we finalized our conclusion on the appropriate discount rate to be incorporated into our impairment model and concluded that we did not have an impairment as of December 31, 2010.

We have performed a sensitivity analysis to detail the impact that changes in assumptions may have on the outcome of the impairment test. Our sensitivity analysis provides a range of potential impairment for each reporting unit, where the starting point of the range is our selected discount rate for the 2010 annual impairment test and increases the discount rate in increments of 1.0% until the rate of 15.5,%, which was the discount rate used in our 2009 annual impairment test.

The following table reflects our sensitivity analysis.

		Network Radio				Metro Traffic				Total
Discount rate
10.0%		$	—			$	—			$	—
11.0%			—				—				—
12.0%			—				1,292				1,292
13.0%			—				8,193				8,193
14.0%			1,932				13,821				15,753
15.5%			8,211				20,466				28,677

Pro Forma Information 2009 and 2008

The following unaudited pro forma condensed financial information has been prepared to give effect to the Refinancing, as if the Refinancing had been completed on the first day of the earliest period presented. As a result of the Refinancing, a change in control occurred, which required us to account for the change of control with a revaluation of our balance sheet to a fair-value basis from a historical cost basis.

The actual results reported in periods following the Refinancing may differ significantly from those reflected in these pro forma financial statements for a number of reasons, including, but not limited to, differences between the assumptions used to prepare these pro forma financial statements and actual amounts. In addition, no adjustments have been made for non-recurring items related to the Refinancing. As a result, this pro forma information does not purport to be indicative of what the financial condition or results of operations would have been had the Refinancing been completed on the first day of the earliest period presented. These pro forma financial statements are based upon historical financial statements and do not purport to project the future financial condition and results of operations after giving affect to the Refinancing.

The pro forma adjustments described below have been developed based on assumptions and adjustments, including assumptions relating to the purchase price and the allocation thereof to the assets acquired and liabilities assumed based on preliminary estimates of fair value.

The following unaudited pro forma condensed financial information for the twelve months ended December 31, 2009 and 2008 should be read in conjunction with, and is qualified by reference to, our consolidated income statements for the period from April 24, 2009 to December 31, 2009, the period from January 1, 2009 to April 23, 2009 and the year ended December 31, 2008.

		Pro Forma For the Twelve Months Ended December 31, 2009
		For the Period				For the Period
		April 24 to				January 1 to				Pro Forma
		December 31, 2009				April 23, 2009				Adjustments				Pro Forma
Revenue		$	228,860			$	111,474			$	—			$	340,334
Operating costs			210,805				111,309				—				322,114
Depreciation and amortization			21,474				2,584				(4,909)	(A)			19,149
Corporate general and administrative expenses			10,398				4,519				—				14,917
Goodwill impairment			50,501				—				—				50,501
Restructuring charges			3,976				3,976				—				7,952
Special charges			5,554				12,819				—				18,373
Total Expenses			302,708				135,207				(4,909	)			433,006
Operating (loss) income			(73,848	)			(23,733	)			4,909				(92,672	)
Interest expense			14,781				3,222				2,401	(B)			20,404
Other expense (income)			(4	)			(359	)			—				(363	)
Loss before income tax			(88,625	)			(26,596	)			2,508				(112,713	)
Income tax benefit			(25,025	)			(7,635	)			711	(C)			(31,949	)
Net loss		$	(63,600	)		$	(18,961	)		$	1,797			$	(80,764	)

		Pro Forma For the Twelve Months Ended December 31, 2008
						Pro Forma
		Historical				Adjustments				Pro Forma
Revenue		$	404,416			$	—			$	404,416
Operating costs			357,927				—				357,927
Depreciation and amortization			11,052				17,399	(A)			28,451
Corporate general and administrative expenses			16,007				—				16,007
Goodwill impairment			430,126				—				430,126
Restructuring charges			14,100				—				14,100
Special charges			13,245				—				13,245
Total Expenses			842,457				17,399				859,856
Operating loss			(438,041	)			(17,399	)			(455,440	)
Interest expense			16,651				1,717	(B)			18,368
Other expense (income)			(12,369	)			—				(12,369	)
Loss before income tax			(442,323	)			(19,116	)			(461,439	)
Income tax benefit			(14,760	)			(5,706)	(C)			(20,466	)
Net loss		$	(427,563	)		$	(13,410	)		$	(440,973	)

Notes to the Unaudited Pro Forma Adjustments

The Unaudited Pro Forma Statements of Operations for the years ended December 31, 2008 and 2009 reflect the Refinancing and the resultant acquisition accounting and gives effect to these events as if each had occurred on January 1, 2008:

Note A - In accordance with authoritative guidance, which is applicable to the Refinancing and the change of control, we have revalued our goodwill and intangibles using our best estimate of current fair value. The value assigned to goodwill and indefinite lived intangible assets is not amortized to expense and the majority is not expected to be tax deductible. Our client contracts are typically exclusive agreements with our partners and/or talent to provide programming and content over a specified period of time. The values assigned to definite lived assets are amortized over their estimated useful life.

Also, in accordance with authoritative guidance, we have identified property and equipment which we valued using our best estimate of current fair value. Accordingly, an asset for property and equipment of $6,750 has been recorded to reflect the estimated fair value of the property and equipment and such amount is being depreciated to expense over the remaining lives of the assets.

Similarly, in accordance with authoritative guidance, we have identified leases and client contracts which we valued below market. Accordingly, a liability of $3,460 has been recorded to reflect the estimated fair value of the leases and client contracts and such amount is being taken to income over the remaining life of the contract.

The following table summarizes the pro forma charges for amortization and depreciation expense for the twelve months ended December 31, 2009 and 2008.

		Pro Forma Changes for Long Lived Assets
		For the Twelve Months ended December 31, 2009
						Opening								Ending
Intangibles		Estimated life				Balance				Amortization				Balance
Trademarks		Indefinite				$	20,800			$	—			$	20,800
Affiliate relationships		10 years					64,890				7,210				57,680
Software and technology		5 years					4,480				1,120				3,360
Client contracts		5 years					6,946				1,984				4,962
Leases		7 years					840				140				700
Insertion orders		9 months					—				—				—
Subtotal—Intangible Assets							97,956				10,454				87,502
Property and equipment		Various lives					6,220				366				5,854
Subtotal— Assets							104,176				10,820				93,356
Client Contracts		1.5 years					(470	)			(470	)			—
Leases		7 years					(1,757	)			(293	)			(1,464	)
Subtotal—Liabilities							(2,227	)			(763	)			(1,464	)
Net Total											10,057
Amortization expense											14,966
										$	(4,909	)

		Pro Forma Changes for Long Lived Assets
		For the Twelve Months ended December 31, 2008
						Opening								Ending
Intangibles		Estimated life				Balance				Amortization				Balance
Trademarks		Indefinite				$	20,800			$	—			$	20,800
Affiliate relationships		10 years					72,100				7,210				64,890
Software and technology		5 years					5,600				1,120				4,480
Client contracts		5 years					8,930				1,984				6,946
Leases		7 years					980				140				840
Insertion orders		9 months					8,400				8,400				—
Subtotal—Intangible Assets							116,810				18,854				97,956
Property and equipment		Various lives					6,750				530				6,220
Subtotal— Assets							123,560				19,384				104,176
Client contracts		1.5 years					(1,410	)			(940	)			(470	)
Leases		7 years					(2,050	)			(293	)			(1,757	)
Subtotal—Liabilities							(3,460	)			(1,233	)			(2,227	)
Net Total											18,151
Amortization expense											752
										$	17,399

Amortization of the new intangibles for Affiliate Relationships, Client Contracts and Insertion Orders and the property and equipment was reflected in these tables.

Note B — For the time periods shown, the Senior Notes bore interest at 15% per annum, payable 10% in cash and 5% in-kind (PIK interest). Interest expense was adjusted to reflect the new debt of $117,500 and new interest rate of 15% on such indebtedness. The PIK interest is added to the principal quarterly but will not be payable until maturity. The debt has been recorded for the pro forma financial statements at face value, which is our best estimate of fair value.

		Pro Forma Changes Interest
		For the Twelve Months Ended December 31,
		2009				2008
Interest expense on new debt		$	20,329			$	17,958
Interest expense on indebtedness prior to refinancing			17,928				16,241
Incremental interest expense adjustment		$	2,401			$	1,717

Note C — Taxes were calculated on the new pro forma (loss) amount using the effective rate for each applicable period.

		Pro Forma Changes - Taxes
		December 31, 2009				December 31, 2008
Pretax loss		$	(26,596	)		$	(442,323	)
Tax benefit			7,635				14,760
Effective rate			28.7	%			3.3	%
Non-deductible portion of goodwill impairment			0.0	%			31.8	%
Normalized effective tax rate			28.7	%			35.1	%
Proforma pretax loss			(112,713	)			(461,439	)
Adjustment for goodwill impairment			—				403,194
Adjusted proporma pretax loss			(112,713	)			(58,245	)
Proforma tax benefit		$	(32,357	)		$	(20,466	)