v3.10.0.1

ACQUISITIONS AND OTHER (Block) | 12 Months Ended
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Dec. 31, 2018
Business Combinations [Abstract] |
Mergers Acquisitions And Dispositions Disclosures Text Block | 3. BUSINESS COMBINATIONS The Company records acquisitions under the acquisition method of accounting, and allocates the purchase price to the assets and liabilities based upon their respective fair values as determined as of the acquisition date. Merger and acquisition costs are excluded from the purchase price as these costs are expensed for book purposes and amortized for tax purposes. 2018 WXTU Transaction On July 18, 2018, the Company entered into an agreement with Beasley Broadcast Group, Inc. (“Beasley”) to sell certain assets of WXTU-FM, serving the Philadelphia, Pennsylvania radio market for $38.0 million in cash (the “WXTU Transaction”). The Company also simultaneously entered into a TBA with Beasley where Beasley commenced operations of WXTU-FM on July 23, 2018. During the period of the TBA, the Company excluded net revenues and station operati ng expenses associated with operating WXTU-FM in the Company’s consolidated financial statements. The Company completed this disposition, which was subject to customary regulatory approvals, during the third quarter of 2018 and recognized a gain of approx imately $4.4 million. 2018 Jerry Lee Transaction On September 27, 2018, the Company completed a transaction to acquire the assets of WBEB-FM, serving the Philadelphia, Pennsylvania radio market from Jerry Lee Radio, LLC (“Jerry Lee”) for a purchase pr ice of $57.5 million in cash, less certain working capital and other credits (the “Jerry Lee Transaction”). The Company used proceeds from the WXTU Transaction and cash on hand to fund this acquisition. Upon the completion of the WTXU Tr ansaction and the Jerry Lee Transaction, the Company will continue to operate six radio stations in the Philadelphia, Pennsylvania market. On August 7, 2018, the Company entered into a TBA with Jerry Lee. During the period of the TBA, the Company include d net revenues, station operating expenses and monthly TBA fees associated with operating WBEB-FM in the Company’s consolidated financial statements. The allocations presented in the table below are based upon management’s estimate of the fair values usin g valuation techniques including income, cost and market approaches. In estimating the fair value of the acquired FCC broadcasting licenses, the fair value estimates are based on, but not limited to, expected future revenue and cash flows that assume an e xpected future growth rate of 1.0% and an estimated discount rate of 9.0%. The gross profit margins utilized were considered appropriate based on management’s expectations and experience in equivalent sized market s. The Company determines the fair value of the broadcasting licenses by relying on a discounted cash flow approach assuming a start-up scenario in which the only assets held by an investor are broadcasting licenses. The Company’s fair value analysis con tains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. Any excess of the purchase pric e over the assets acquired was reported as goodwill. The Company recorded goodwill on its books, which is fully deductible for income tax purposes. Management believes that this acquisition provides the Company with an opportunity to benefit from operati onal efficiencies from combining operations of the acquired station with the Company’s existing stations within the Philadelphia market. The following preliminary purchase price allocations are based upon the valuation of assets and these estimates and assumptions are subject to change as the Company obtains additional information during the measurement period, which may be up to one year from the acquisition date. These assets pending finalization include intangible assets. Differences between the pre liminary and final valuation could be substantially different from the initial estimates.
|  |  |  | Useful Lives in Years
|  | Preliminary Value |  | From |  | To
|  | (amounts in thousands) |  |  |
Assets |  |  |  |  |  |  |
Equipment |  | $ | 981 |  | 3 |  | 7
Total tangible property |  |  | 981 |  |  |  |
Advertising contracts |  |  | 477 |  | 1 |  | 1
Radio broadcasting licenses |  |  | 27,346 |  | non-amortizing
Goodwill |  |  | 24,396 |  | non-amortizing
Net working capital |  |  | 3,234 |  | not applicable
Total intangible and other assets |  |  | 55,453 |  |  |  |
Total assets |  | $ | 56,434 |  |  |  |
Preliminary fair value of net assets acquired |  | $ | 56,434 |  |  |  |
2018 Emmis Acquisition On April 30, 2018, the Company completed a transaction to acquire two radio stations in St. Louis, Missouri from Emmis Communications Corporation (“Emmis”) for a purchase price of $15.0 million in cash (the “Emmis Acquisition”). The Company borrowed under its revolving credit facility (the “Revolver”) to fund the acquisition. With this acquisition, the Company increased its presence in St. Louis, Missouri, to five radio stations. On March 1, 2018, the Company entered into an as set purchase agreement and a TBA with Emmis to operate two radio stations. During the period of the TBA, the Company included in net revenues, station operating expenses and monthly TBA fees associated with operating these stations in the Company’s consol idated financial statements. The allocations presented in the table below are based upon management’s estimate of the fair values using valuation techniques including income, cost and market approaches. In estimating the fair value of the acquired FCC bro adcasting licenses, the fair value estimates are based on, but not limited to, expected future revenue and cash flows that assume an expected future growth rate of 1.0% and an estimated discount rate of 9.0%. The gr oss profit margins utilized were considered appropriate based on management’s expectations and experience in equivalent sized markets. The Company determines the fair value of the broadcasting licenses by relying on a discounted cash flow approach assumin g a start-up scenario in which the only assets held by an investor are broadcasting licenses. The Company’s fair value analysis contains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about futur e performance using industry normalized information for an average station within a certain market. Any excess of the purchase price over the assets acquired was reported as goodwill. The following preliminary purchase price allocations are based upon the valuation of assets and these estimates and assumptions are subject to change as the Company obtains additional information during the measurement period, which may be up to one year from the acquisition date. These assets pending finalization include in tangible assets. Differences between the preliminary and final valuation could be substantially different from the initial estimates.
|  |  |  | Useful Lives in Years
|  | Preliminary Value |  | From |  | To
|  | (amounts in thousands) |  |  |
Assets |  |  |  |  |  |  |
Equipment |  | $ | 1,558 |  | 3 |  | 7
Total tangible property |  |  | 1,558 |  |  |  |
Advertiser relationships |  |  | 207 |  | 5 |  | 15
Advertising contracts |  |  | 114 |  | 1 |  | 1
Radio broadcasting licenses |  |  | 12,785 |  | non-amortizing
Goodwill |  |  | 332 |  | non-amortizing
Other noncurrent assets |  |  | 4 |  | 2 |  | 2
Total intangible and other assets |  |  | 13,442 |  |  |  |
Total assets |  | $ | 15,000 |  |  |  |
Preliminary fair value of assets acquired |  | $ | 15,000 |  |  |  |
2017 CBS Radio Business Acquisition On November 17, 2017, the Company acquired the CBS Radio business from CBS to further strengthen its scale and capabilities to compete more effectively with other media for a larger share of advertising dollars. The purchase price was $2.56 billion and consisted of $1.17 billion of total equity consideration and $1.39 billion of assumed debt. The CBS Radio business acquisition was completed pursuant to the CBS Radio Merger Agreement, dated February 2, 2017, by and among the Company, CBS, CBS Radio, and Merger Sub. On November 17, 2017, (i) Merger Sub was merged with and into CBS Radio, with CBS Radio continuing as the surviving corporation and a direct, wholly-owned subsidiary of the Company and (ii) each share of CBS Radio common stock was converted into one share of the Company’s common stock. The Company issued 101,407,494 shares of its Class A common Stock to the former holders of CBS Radio common stock. At the time of the Merger, each outstanding restricted stock unit (“RSU”) and stock option with respect to CBS Class B common stock held by employees of CBS Radi o was canceled and converted into equity awards for the Company’s Class A common stock. The conversion was based on the ratio of the volume-weighted average per share closing prices of CBS stock on the five trading days prior to the date of acquisition an d the Company’s stock on the five trading days following the date of acquisition. Entercom Communications Corp. is considered to be the acquiring company for accounting purposes. To complete the Merger, certain divestitures were required by the FCC in o rder to comply with the FCC’s ownership rules and policies. These divestitures consisted of: (i) the exchange transaction with iHeartMedia, Inc. (“iHeart”); (ii) a station exchange with Beasley; (iii) a cash sale to Bonneville International Corporation (“Bonneville”); and (iv) a cash sale to Educational Media Foundation (“EMF”). Due to the structure of the transaction, there was no step-up in tax basis for the assets acquired as the Company assumed the existing tax basis in the assets of CBS Radio. The absence of a step-up in tax basis will limit the Company’s tax deductions in future years and impacts the amount of deferred tax liabilities recorded as part of purchase price accounting. If any of the Internal Distributions or the Final Distribution, ea ch as defined in the CBS Radio Merger Agreement, does not qualify as a transaction that is tax-free for U.S. federal income tax purposes under Section 355 of the Code or the Merger does not qualify as a tax-free “reorganization” under Section 368(a) of the Code, including as a result of actions taken in connection with the distributions made by CBS to facilitate the Merger or as a result of subsequent acquisitions of shares of CBS, Entercom, or CBS Radio, then CBS and/or holders of CBS Common Stock that rec eived Radio Common Stock in the Final Distribution may be required to pay substantial U.S. federal income taxes, and, in certain circumstances, CBS Radio and Entercom may be required to indemnify CBS for any such tax liability. The allocations presented in the table below are based upon management’s estimate of the fair values using valuation techniques including income, cost and market approaches. In estimating the fair value of the acquired FCC broadcasting licenses, the fair value estimates are based on, but not limited to, hypothetical expected future revenue and cash flows that assume an expected future growth rate of 1.0% and an estimated discount rate of 9.0%. The gross profit margins utilized were considered appropriate based on management’s expectations and experience in equivalent sized markets. The Company determines the fair value of the broadcasting licenses by relying on a discounted cash flow approach assuming a start-up scenario in which the only asset s held by an investor are broadcasting licenses. The Company’s fair value analysis contains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized inform ation for an average station within a certain market. Any excess of the purchase price over the net assets acquired was reported as goo dwill. The goodwill recorded reflects management’s expectations of its ability to gain access to and penetrate CBS Radio’s customer base and the benefits of being able to leverage operational efficiencies with favorable growth opportunities as a results of a large national presence. A portion of the goodwill carryover basis is tax deductible. The following table reflects: (i) the Company’s preliminary allocation of the purchase price to the assets acquired and liabilities assumed as of the acquisition date; (ii) measurement period adjustments made to the preliminary allocation during the measurement period; and (iii) the f inal allocation of the purchase price to the assets acquired and liabilities assumed.
|  | Preliminary Value |  |  |  |  |  |
|  | as of acquisition date |  |  |  |  |  |
|  | (as previously |  | Measurement |  |  |
|  | reported as of |  | Period |  |  |
Description |  | December 31, 2017) |  | Adjustment |  | As Adjusted
|  | (amounts in thousands)
Assets |  |  |  |  |  |  |  |  |
Accounts receivable |  | $ | 241,548 |  | $ | - |  | $ | 241,548
Prepaid sports rights and favorable sports contracts |  |  | 4,160 |  |  | - |  |  | 4,160
Prepaid expenses, deposits and other |  |  | 20,625 |  |  | 476 |  |  | 21,101
Other current assets |  |  | 7,350 |  |  | 1,741 |  |  | 9,091
Total current assets |  |  | 273,683 |  |  | 2,217 |  |  | 275,900
Land |  |  | 112,880 |  |  | - |  |  | 112,880
Land improvements |  |  | 3,988 |  |  | (2,640) |  |  | 1,348
Leasehold improvements |  |  | 26,255 |  |  | 9,774 |  |  | 36,029
Buildings |  |  | 19,246 |  |  | (5,206) |  |  | 14,040
Furniture and fixtures |  |  | 10,929 |  |  | (6,849) |  |  | 4,080
Equipment and towers |  |  | 76,486 |  |  | 21,346 |  |  | 97,832
Construction in process |  |  | 14,598 |  |  | - |  |  | 14,598
Total tangible property |  |  | 264,382 |  |  | 16,425 |  |  | 280,807
Advertiser relationships |  |  | 27,453 |  |  | - |  |  | 27,453
Radio broadcasting licenses |  |  | 1,880,400 |  |  | - |  |  | 1,880,400
Goodwill |  |  | 820,961 |  |  | (21,498) |  |  | 799,463
Assets held for sale |  |  | 255,650 |  |  | - |  |  | 255,650
Favorable leases |  |  | 16,580 |  |  | - |  |  | 16,580
Other noncurrent assets |  |  | 1,050 |  |  | 4,176 |  |  | 5,226
Total intangible and other assets |  |  | 3,002,094 |  |  | (17,322) |  |  | 2,984,772
Total assets |  | $ | 3,540,159 |  | $ | 1,320 |  | $ | 3,541,479
Liabilities |  |  |  |  |  |  |  |  |
Accounts payable |  | $ | 36,137 |  | $ | 421 |  | $ | 36,558
Accrued expenses |  |  | 35,154 |  |  | 2,309 |  |  | 37,463
Accrued salaries and benefits |  |  | 26,324 |  |  | - |  |  | 26,324
Current portion of long-term debt |  |  | 10,600 |  |  | - |  |  | 10,600
Unfavorable sports liability - current portion |  |  | 4,803 |  |  | - |  |  | 4,803
Accrued interest |  |  | 4,529 |  |  | - |  |  | 4,529
Unearned revenues - current portion |  |  | 14,971 |  |  | - |  |  | 14,971
Total current liabilities |  |  | 132,518 |  |  | 2,730 |  |  | 135,248
Unearned revenues - non-current portion |  |  | 13,859 |  |  | - |  |  | 13,859
Unfavorable lease liability |  |  | 12,770 |  |  | - |  |  | 12,770
Unfavorable sports liability - non-current portion |  |  | 22,597 |  |  | - |  |  | 22,597
Non-current portion of long-term debt |  |  | 1,376,900 |  |  | - |  |  | 1,376,900
Deferred tax liability |  |  | 780,832 |  |  | (3,336) |  |  | 777,496
Other long-term liabilities |  |  | 31,835 |  |  | 1,926 |  |  | 33,761
Total liabilities |  | $ | 2,371,311 |  | $ | 1,320 |  | $ | 2,372,631
Preliminary fair value of net assets acquired |  | $ | 1,168,848 |  | $ | - |  | $ | 1,168,848
The aggregate fair value purchase price allocation of the assets and liabilities acquired in the CBS Radio Merger as reported on the Company’s Form 10-K filed with the SEC on March 16, 2018, were revised during the year ended December 31, 2018 primarily due to: (i) a change to the deferred tax liabilities associated with certain stations acquired in the CBS Radio Merger which resulted in a decrease to goodwill of $3.3 million; (ii) a change to other current assets acquired in the CBS Radio Merg er which resulted in a decrease to goodwill of $1.3 million; (iii) a change to prepaid assets acquired in the CBS Radio Merger which resulted in a decrease to goodwill of $0.5 million; (iv) a change to accrued expenses acquired in the CBS Radio Merger whic h resulted in an increase to goodwill of $2.3 million; (v) the recording of current and noncurrent lease abandonment liabilities assumed and a corresponding receivable for reimbursement from CBS Corporation; (vi) a change to tenant improvement allowances ou tstanding that were acquired in the CBS Radio Merger which resulted in a decrease to goodwill of $2.3 million; (vii) a change to the purchase price allocated to acquired tangible property which resulted in a decrease to goodwill of $16.4 million; and (viii) reclassification between the categories of acquired tangible property. As the measurement period ended on November 17, 2018, t he adjusted purchase price allocation amounts included in the table above are no longer subject to change. The Company is in t he process of finalizing estimates and assumptions related to certain net working capital accounts acquired in the Merger. Any adjustments to the purchase price allocation required after the one year measurement period, which may be material, are expected to be recorded in the consolidated statements of operations as operating expenses or income. Under purchase price accounting for the CBS Radio Merger, the Company recorded favorable and unfavorable lease s for studio and transmitter site property leases and unfavorable sports programming contracts as these leases and contracts contain terms that were considered to be below or above market rates. These leases and contracts are reflected net in other current and long-term assets and liabilities in the consolidated balance sheets and are amortized on a straight-line basis over the life of th e lease or contract. A favorable or unfavorable lease or contract will result in an increase or decrease, respectively, to station operating expenses. The future amortization to unfavorable leases and contracts is as follows:
| As Of
| December 31,
| 2018
| (amounts in
| thousands)
Years ending December 31, |  |
2019 | $ | 7,318
2020 |  | 6,909
2021 |  | 6,606
2022 |  | 5,725
2023 |  | 6,099
Thereafter |  | 1,011
| $ | 33,668
2017 Exchange Transaction: The iHeartMedia Transaction On November 1, 2017, the Company entered into an agreement (the “iHeartMedia Transaction”) with iHeartMedia, Inc. (“iHeart”) to exchange three CBS Radio stations in Seattle, Washington, and two CBS Radio and two Company radio stations in Boston, Massachusetts, for four iHeart radio stations in Chattanooga, Tennessee, and six iHeart radio stations in Richmond, Virginia, respectively. Upon consummation of the CBS Merger, the Co mpany contributed the stations to be divested to iHeart into an FCC Disposition trust. Concurrently with the Company entering into an asset exchange agreement, the FCC Disposition Trust and iHeart entered into TBAs which provided for iHeart and the Compan y, respectively, to operate certain radio stations pending closing. Operation under each TBA commenced at various times and for certain stations after the Merger. During the period of the TBA, the Company: (i) included net revenues and station operating expenses associated with operating the Richmond and Chattanooga stations in the Company’s consolidated financial statements; and (ii) excluded net revenues and station operating expenses associated with iHeart’s operation of the Seattle stations and Boston stations from the Company’s consolidated financial statements. As a result of this iHeartMedia Transaction, the Company enter ed into two new markets in Richmond, Virginia and Chattanooga, Tennessee. The results of operations of KZOK FM and KJAQ FM from November 17, 2017 to December 18, 2017 are presented within discontinued operations as these stations were acquired from CBS Radio and were never operated by the Company and immediately qualified as held for sale. Refer to Note 19, Assets Held For Sale And Discontinued Operations, for additional information. 2017 Exchange Transaction: The Beasley Transaction On November 1, 2017, the Company entered into an agreement (the “Beasley Transaction”) with Beasley Broadcast Group (“Beasley”) to exchange a C BS Radio station (WBZ FM) in Boston, Massachusetts for another station in the same market (WMJX FM) and cash proceeds of $12.0 million. Concurrently with entering into the asset exchange agreement, the Company entered into a TBA to operat e WMJX FM and included net revenues and station operating expenses in the Company’s consolidated financial statements for the period from December 4, 2017 through December 19, 2017. The results of operations of WBZ FM from November 17, 2017 to December 18, 2017 are presented within discontinued operations as this station was originally owned by CBS Radio and was never a part of the Company’s continuing operations. Prior to the commencement of operations under the TBA, the Company contributed WBZ FM to a t rust and the trust operated the station for a period of time. Refer to Note 19, Assets Held For Sale And Discontinued Operations, for additional information. In valuing the non-monetary assets that were part of the consideration transferred, the Com pany utilized the fair value as of the acquisition date, with any excess of the purchase price over the net assets acquired reported as goodwill. The fair value of the acquired assets and liabilities was measured from the perspective of a market participa nt, applying the same methodology and types of assumptions as described above. Applying these methodologies requires significant judgment. Summary o f iHeart a nd Beasley Transactions b y Radio Station
iHeartMedia Transaction
Market |  | Radio Stations |  | Transactions |  | TBA Commencement Date |  | Disposition or Acquisition Date
Richmond, VA |  | WRVA AM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Richmond, VA |  | WRXL FM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Richmond, VA |  | WTVR FM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Richmond, VA |  | WBTJ FM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Richmond, VA |  | WRNL AM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Richmond, VA |  | WRVQ FM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Chattanooga, TN |  | WKXJ FM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Chattanooga, TN |  | WUSY FM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Chattanooga, TN |  | WRXR FM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Chattanooga, TN |  | WLND FM |  | Company acquired from iHeart |  | December 4, 2017 |  | December 19, 2017
Boston, MA |  | WBZ AM |  | Company divested to iHeart |  | November 18, 2017 |  | December 19, 2017
Boston, MA |  | WZLX FM |  | Company divested to iHeart |  | November 18, 2017 |  | December 19, 2017
Boston, MA |  | WRKO AM |  | Company divested to iHeart |  | Not Applicable |  | December 19, 2017
Boston, MA |  | WKAF FM |  | Company divested to iHeart |  | November 18, 2017 |  | December 19, 2017
Seattle, WA |  | KZOK FM |  | Company divested to iHeart |  | Not Applicable |  | December 19, 2017
Seattle, WA |  | KJAQ FM |  | Company divested to iHeart |  | Not Applicable |  | December 19, 2017
Seattle, WA |  | KFNQ AM |  | Company divested to iHeart |  | November 18, 2017 |  | December 19, 2017
Beasley Transaction
Market |  | Radio Stations |  | Transactions |  | TBA Commencement Date |  | Disposition or Acquisition Date
Boston, MA |  | WMJX FM |  | Company acquired from Beasley |  | December 4, 2017 |  | December 19, 2017
Boston, MA |  | WBZ FM |  | Company divested to Beasley |  | Not Applicable |  | December 19, 2017
Valuation of the iHeartMedia Transaction and The Beasley Transaction As discussed above, the Company completed a partial non-monetary transaction with Beasley and a non-monetary transaction with iHeart to exchange several radio stations in certain markets. In valuing the non-monetary assets that were part of the consideration transferred, the Company utilized the fair value as of the date the assets were exchanged. The allocations presented in the table below are based upon management’s estimate o f the fair values using valuation techniques including income, cost and market approaches. In estimating the fair value of the acquired FCC broadcasting licenses, the fair value estimates are based on, but not limited to, expected future revenue and cash flows that assume an expected future growth rate of 1.0% and an estimated discount rate of 9.0%. The gross profit margins utilized were considered appropriate based on management’s expectations and experience in equivalent sized markets. The Company dete rmines the fair value of the broadcasting licenses by relying on a discounted cash flow approach assuming a start-up scenario in which the only assets held by an investor are broadcasting licenses. The Company’s fair value analysis contains assumptions ba sed on past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. Any excess between the fair values of the net assets given up over the fair values of the net assets acquired was reported as goodwill. The following table reflects: (i) the Company’s preliminary allocation of the purchase price to the assets acquired and liabilities assumed as of the acquisition date; (ii) measurement period adjustments made to the preliminary allocation during the measurement period; and (iii) the final aggregate fair value purchase price allocation of these assets and liabilities assumed.
Beasley Transaction
| Assets Acquired |  | Assets Disposed
| (amounts in thousands)
Assets |  |  |  |  |
Total property plant and equipment | $ | 667 |  | $ | 807
Total tangible assets |  | 667 |  |  | 807
Sports rights agreement |  | - |  |  | 267
Radio broadcasting licenses |  | 35,944 |  |  | 35,944
Goodwill |  | 289 |  |  | 11,882
Total intangible assets |  | 36,233 |  |  | 48,093
Additional cash consideration |  | 12,000 |  |  | -
Total value | $ | 48,900 |  | $ | 48,900
iHeart Transaction
| Assets Acquired |  | Assets Disposed
| (amounts in thousands)
Assets |  |  |  |  |
Total property plant and equipment | $ | 13,725 |  | $ | 8,149
Total tangible assets |  | 13,725 |  |  | 8,149
Acquired advertising contracts |  | 265 |  |  | -
Advertiser relationships |  | 1,041 |  |  | -
Radio broadcasting licenses |  | 50,621 |  |  | 56,299
Goodwill |  | 11,700 |  |  | 6,852
Total intangible assets |  | 63,627 |  |  | 63,151
Liabilities |  |  |  |  |
Unfavorable lease agreements assumed |  | (1,301) |  |  | -
Deferred tax liabilities |  | (4,751) |  |  | -
Total value | $ | 71,300 |  | $ | 71,300
2017 Local Marketing Agreement: The Bonneville Transaction On November 1, 2017, the Company a ssigned assets to a trust and the trust subsequently entered into two local marketing agreements (“LMAs”) with Bonneville. The LMAs, which were effective upon the closing of the Merger, allowed Bonneville to operate eight radio stations in the San Francisc o, California and Sacramento, California markets. Of the eight radio stations operated by Bonneville, three were originally owned by the Company and the remaining five were originally owned by CBS Radio. The Company conducted an analysis and determined t he assets of the eight stations satisfied the criteria to be presented as assets held for sale. The stations which were acquired from CBS Radio and were never operated by the Company are included within discontinued operations. On August 2, 2018, the Comp any entered into an asset purchase agreement with Bonneville to dispose of the eight radio stations in the San Francisco, California and Sacramento, California markets for $141.0 million in cash. During the year ended December 31, 2018, the Company closed on this sale, which resulted in a loss of approximately $0.2 million to the Company. Refer to Note 19, Assets Held for Sale and Discontinued Operations, for additional information. 2017 Charlotte Acquisition On January 6, 2017, the Company completed a transaction to acquire four radio stations in Charlotte, North Carolina from Beasley for a purchase price of $24 million in cash. The Company used cash on hand to fund the acquisition. On October 17, 2016, the Company entered into an asset purchase agreement and a TBA with Beasley to operate three of the four radio stations that were held in a trust (the “Charlott e Trust”). On November 1, 2016, the Company commenced operations of the radio stations held in the Charlotte Trust and began operating the fourth station upon closing on the acquisition with Beasley in January 2017. During the period of the TBA, the Com pany included net revenues, station operating expenses and monthly TBA fees associated with operating these stations in the Company’s consolidated financial statements. The allocations presented in the table below are based upon management’s estimate of the fair values using valuation techniques including income, cost and market approaches. In estimating the fair value of the acquired FCC broadcasting licenses, the fair value estimates are based on, but not limited to, expected future revenue and cash flo ws that assume an expected future growth rate of 1.0% and an estimated discount rate of 9.0%. The gross profit margins utilized were considered appropriate based on management’s expectations and experience in equ ivalent sized markets. The Company determines the fair value of the broadcasting licenses by relying on a discounted cash flow approach assuming a start-up scenario in which the only assets held by an investor are broadcasting licenses. The Company’s fair value analysis contains assumptions based upon past experience, reflects expectations of industry observers and includes judgments about future performance using industry normalized information for an average station within a certain market. Any excess of the purchase price over the net assets acquired was reported as goodwill. The purchase price allocations are based upon the valuation of assets and liabilities, which include the valuation of intangible assets, and are final. The following table reflec ts the final aggregate fair value purchase price allocation of these assets and liabilities.
|  |  |  | Useful Lives in Years
|  | Final Value |  | From |  | To
|  | (amounts in |  |  |
|  | thousands) |  |  |
Assets |  |  |  |  |  |  |
Land |  | $ | 2,539 |  | non-depreciating
Buildings |  |  | 217 |  | 15 |  | 25
Equipment |  |  | 4,569 |  | 3 |  | 40
Total property plant and equipment |  |  | 7,325 |  |  |  |
Deferred tax asset |  |  | 287 |  | life of underlying asset
Radio broadcasting licenses and goodwill |  |  | 17,384 |  | non-amortizing
Total assets |  |  | 24,996 |  |  |  |
Liabilities |  |  |  |  |  |  |
Unfavorable lease liabilities |  |  | 735 |  | over remaining lease life
Deferred tax liability |  |  | 261 |  | life of underlying liability
Total liabilities |  |  | 996 |  |  |  |
Fair value of net assets acquired |  | $ | 24,000 |  |  |  |
2017 Disposition s In October 201 7, the Com pany divested three radio stations to EMF in order to facilitate the Merger. The Company disposed of equipment, radio broadcasting licenses, goodwill, and other assets across three of its markets for $57.8 million in cash. The Company reported a gain, net of expenses, of $2.5 million on the disposition of these assets. 2016 Disposition In March 2016, the Company sold certain assets of KRWZ AM in Denver, Colorado, for $3.8 million in cash. The Company believes that the sale of this station, with a marginal market share, did not alter the Company’s competitive position in the market. The Company reported a gain, net of expenses, of $0.3 million on the disposition of these assets. Merger and Acquisition Costs Merger and acquisition costs were expensed as a separate line item in the statement of operations. The Company records merger and acquisition costs whether or not an acquisition occurs. Merger and acquisition costs incurred in 2018 consist primarily of legal, professional and advisory services related to: (i) the Company’s Merger with CBS Radio; (ii) the Jerry Lee Transaction; and (iii) the Emmis Acquisition. These costs incurred in 2017 and 2016 consist primarily of legal, professional and advisory services related to the Company’s Merger with CBS Radio. Restructuri ng Charges Restructuring charges were expensed as a separate line item in the statement of operations. The following table presents the components of restructuring charges.
| Years Ended
| December 31,
| 2018 |  | 2017 |  | 2016
| (amounts in thousands)
Costs to exit duplicative contracts | $ | 229 |  | $ | 500 |  | $ | -
Workforce reduction |  | 3,599 |  |  | 10,441 |  |  | -
Lease abandonment costs |  | 1,315 |  |  | 2,874 |  |  | -
Other restructuring costs |  | 687 |  |  | 147 |  |  | -
Transition services costs |  | - |  |  | 2,960 |  |  | -
Total restructuring charges | $ | 5,830 |  | $ | 16,922 |  | $ | -
Restructuring Plan During the fourth quarter of 2017, the Company initiated a restructuring plan as a result of the integration of the CBS Radio stations acquired in November 2017. The restructuring plan included: (i) a workforce reduction and realignment charges that included one-time termination benefits and related costs; (ii) lease abandonment costs as described below; and (iii) costs associated with realigning radio stations within the overlap markets between CBS Radio and the Company. A portion of unpaid restructuring charges as of December 31, 201 8 were included in accrued expenses as these expenses are expected to be paid in less than one year. The Company expects to incur additi onal restructuring costs in 2019 under this plan. In connection with the sale of a radio station and the consolidation of studio facilities in a few markets, the Company abandoned certain leases. The Company computed the present value of the remaining lease payments of the lease and re corded lease abandonment costs. These lease abandonment costs include future lease liabilities offset by estimated sublease income. Due to the timing of the lease expirations, the Company assumed there is minimal sublease income. The Company will contin ue to evaluate the opportunities to sublease this space and revise its sublease estimates accordingly. Any increase in the estimate of sublease income will be reflected through the income statement and such amount will also reduce the lease abandonment li abi lity. The leases expire in 2021. During 2015, the Company initiated a restructuring plan primarily as a r esult of the integration of radio stations acquired in July 2015. The restructuring plan included: (i) costs associated with exiting contractual v endor obligations as these obligations were duplicative; (ii) a workforce reduction and realignment charges that included one-time termination benefits and related costs; and (iii) lease abandonment costs as described below. A portion of unpaid restructuri ng charges as of December 31, 2018 were included in accrued expenses as these expenses are expected to be paid in less than one year. In connection with this acquisition, the Company assumed a studio lease in one of its markets that included excess space. During 2015, the Company ceased using a portion of the space after analyzing its future needs as well as comparing its space utilization in other of the Company’s market s. As a result, the Company recorded a lease abandonment expense during the fourth quarter of 2015. Lease abandonment costs include future lease liabilities offset by estimated sublease income. Due to the location of the space in an area of the city that is not considered prime, including a very high vacancy rate in the existing and neighboring building in a soft rental market that is expected to continue throughout the remaining term of the lease, the Company did not include an estimate to sublease any o f the space. The Company will continue to evaluate the opportunities to sublease this space and revise its sublease estimates accordingly. Any increase in the estimate of sublease income will be reflected through the income statement and such amount will also reduce the lease abandonment liability. The lease expires in the year 2026. The lease liability is discounted using a credit risk adjusted basis utilizing the estimated rental cash flows over the remaining term of the agreement.
| Years Ended
| December 31,
| 2018 |  | 2017
| (amounts in thousands)
Restructuring charges and lease abandonment costs, beginning balance | $ | 16,086 |  | $ | 650
Additions resulting from the integration of CBS Radio |  | 5,830 |  |  | 15,005
Restructuring charges assumed from the Merger |  | - |  |  | 1,095
Payments |  | (14,839) |  |  | (664)
Restructuring charges and lease abandonment costs unpaid and outstanding |  | 7,077 |  |  | 16,086
Restructuring charges and lease abandonment costs - noncurrent portion |  | (988) |  |  | (4,413)
Restructuring charges and lease abandonment costs - current portion | $ | 6,089 |  | $ | 11,673
Integration Costs The Company incurred integration costs of $25.4 million during the year ended December 31, 2018. Integration costs were expensed as a separate line item in the consolidated statements of operations. These costs primarily relate to change management consultants and technology-related costs incurred subsequent to the Merger. Unaudited Pro Forma Summary o f Financial Information The following unaudited pro forma information for the years ended December 31, 2018, December 31, 2017, and December 31, 2016 assumes that: (i) the acquisitions in 2018 had occurred as of January 1, 2017; and (ii) the acquisitions and certain dispositions in 2017 had occurred as of January 1, 2016. Refer to information within this Note 3, Business Combinations, for a description of the Company’s acquisition and disposition activities. The unaudited pro forma information presented gives effect to certain adjustments, including: (i) depreciation and amortization of assets; (ii) change in the effective tax rate; (iii) merger and acquisition costs; and (iv) interest expense on any debt incurred to fund the acquis itions which would have been incurred had such acquisitions been consummated at an earlier time. For purposes of this presentation, the pro forma data: (i) excludes the revenue and earnings of stations divested to iHeart and Beasley during 2017 as these stations were exchanged for the radio stations acquired in the Chattanooga, Richmond, and Boston markets; (ii) includes revenue and earnings of stations divested to EMF during 2017; (iii) includes revenue and earnings of stations divested to Bonneville dur ing 2018; and (iv) includes revenue and earnings of the station divested to Beasley during 2018. This unaudited pro forma information has been prepared based on estimates and assumption, which management believes are reasonable. These unaudited pro forma results have been prepared for comparative purposes only and do not purport to be indicative of what would have occurred had the acquisitions been made as of that date or results which may occur in the future.
| Years Ended December 31,
| 2018 |  |  | 2017 |  | 2016
| (amounts in thousands, except per share data)
| Pro Forma |  | Pro Forma |  | Pro Forma
Net revenues | $ | 1,473,266 |  | $ | 1,607,777 |  | $ | 1,656,123
Income (loss) from continuing operations | $ | (357,608) |  | $ | 374,135 |  | $ | (587,393)
Income (loss) from discontinued operations | $ | 1,152 |  | $ | 836 |  | $ | -
Net income (loss) available to the Company | $ | (356,456) |  | $ | 374,971 |  | $ | (587,393)
Net income (loss) available to common shareholders | $ | (356,456) |  | $ | 372,956 |  | $ | (589,294)
Income (loss) from continuing operations |  |  |  |  |  |  |  |
per common share - basic | $ | (2.59) |  | $ | 2.67 |  | $ | (4.20)
Income (loss) from discontinued operations |  |  |  |  |  |  |  |
per common share - basic | $ | 0.01 |  | $ | 0.01 |  | $ | -
Net income (loss) available to common shareholders |  |  |  |  |  |  |  |
per common share - basic | $ | (2.58) |  | $ | 2.66 |  | $ | (4.21)
Income (loss) from continuing operations |  |  |  |  |  |  |  |
per common share - diluted | $ | (2.59) |  | $ | 2.64 |  | $ | (4.20)
Income (loss) from discontinued operations |  |  |  |  |  |  |  |
per common share - diluted | $ | 0.01 |  | $ | 0.01 |  | $ | -
Net income (loss) available to common shareholders |  |  |  |  |  |  |  |
per common share - diluted | $ | (2.58) |  | $ | 2.63 |  | $ | (4.21)
Weighted shares outstanding basic |  | 138,070 |  |  | 140,298 |  |  | 139,908
Weighted shares outstanding diluted |  | 138,070 |  |  | 141,790 |  |  | 139,908
Conversion of preferred stock for dilutive purposes |  |  |  |  |  |  |  |
under the as if method | Not applicable |  | Not applicable |  | anti-dilutive

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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