What changed in this filing

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Item 1. Business

2024-04-01 compared with 2023-03-31 · 26 added, 46 removed, 240 unchanged (23% of the section changed)

3 unchanged sentences

We derive our revenues primarily from radio and digital advertising sales, but we also generate revenues from events, including sponsorships and ticket sales, licensing, and syndication.

On December 9, 2022, Fairway Outdoor LLC, FMG Kentucky, LLC and FMG Valdosta, LLC (collectively, “Fairway”), all of which are wholly owned direct and indirect subsidiaries of MediaCo, entered into an Asset Purchase Agreement (the “Purchase Agreement”), with The Lamar Company, L.L.C., a Louisiana limited liability company (the “Purchaser”).

The transactions contemplated by the Purchase Agreement closed as of the date of the Purchase Agreement.

The purchase price was $78.6 million, subject to certain customary adjustments, paid at closing in cash.

The sale resulted in a pre-tax gain of $46.9 million in the fourth quarter of 2022.

We have classified the related assets and liabilities associated with our Fairway business as discontinued operations in our consolidated balance sheets and the results of our Fairway business have been presented as discontinued operations in our consolidated statements of income for all periods presented through December 9, 2022 as the sale represented a strategic shift in our business that had a major effect on our operations and financial results.

Unless otherwise noted, discussion refers to the Company's continuing operations.

We have classified the related assets and liabilities associated with our Fairway business as discontinued operations in our consolidated balance sheets and the results of our Fairway business have been presented as discontinued operations in our consolidated statements of operations for all periods presented through December 9, 2022 as the sale represented a strategic shift in our business that had a major effect on our operations and financial results.

Unless otherwise noted, discussion herein refers to the Company's continuing operations.

See Note 2 — Discontinued Operations in our consolidated financial statements included elsewhere in this report for additional information.

1 unchanged sentence

BUSINESS STRATEGY

We are committed to improving the operating results of our core assets while simultaneously seeking future growth opportunities in new radio businesses that focus predominately on multi-cultural audiences in the national and digital advertising spaces.

We are committed to improving the operating results of our core assets while simultaneously seeking future growth opportunities in new radio and other complementary broadcast or other businesses that focus predominately on multi-cultural audiences in the national and digital advertising spaces.

Our strategy is focused on the following operating principles:

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To remain competitive, we focus on sustaining and growing our radio audiences, optimizing our pricing strategy and developing innovative marketing programs for our clients that allow them to interact with our audiences in more direct and measurable ways.

These programs often include elements such as on-air endorsements, events, contests, special promotions, Internet advertising, email marketing, interactive mobile advertising and online video.

These programs often include elements such as endorsements, events, contests, special promotions, Internet advertising, email marketing, interactive mobile advertising and online video.

Our ability to deploy multi-touchpoint marketing programs allows us to deliver a stronger return-on-investment for our clients while simultaneously generating ancillary revenue streams for our media properties.

19 unchanged sentences

(“Nielsen”) Portable People Meter results.

A “t” indicates the station tied with another station for the stated ranking.

“Station Audience Share” represents a percentage generally computed by dividing the average number of persons in the primary demographic listening to a particular station during specified time periods by the average number of such persons in the primary demographic for all stations in the market area as determined by Nielsen.

1 unchanged sentence

FORMAT PRIMARY

RANKING IN PRIMARY DEMOGRAPHIC TARGET

New York, NY 2

22 unchanged sentences

We have embarked on a relationship with the Universal Hip Hop Museum, which is currently under construction in New York City.

In January 2022, we helped raise over $1 million by broadcasting a day-long fundraiser for the families impacted by the Bronx apartment fire at Twin Parks North-West.

Radio broadcasting stations compete with the other broadcasting stations in their respective market areas, as well as with other advertising media such as newspapers, cable, magazines, outdoor advertising, transit advertising, the Internet, satellite radio, streaming services, direct marketing, and mobile and wireless device marketing.

4 unchanged sentences

We also seek to improve our position through sales efforts designed to attract advertisers that have done little or no radio advertising by emphasizing the effectiveness of radio advertising in increasing the advertisers' revenues.

The policies and rules of the FCC permit certain joint ownership and joint operation of local stations.

Our radio stations take advantage of these joint arrangements when appropriate to lower operating costs and to offer advertisers more attractive rates and services.

Although we believe that each of our stations can compete effectively in its market, there can be no assurance that either of our stations will be able to maintain or increase its current audience ratings or advertising revenue market share.

11 unchanged sentences

We believe an alignment between talent and strategy is key to scaling the business.

At December 31, 2022, we had 141 full-time and part-time employees, compared to 192 at December 31, 2021, at which earlier date 49 of which employees were employed in our disposed outdoor advertising business.

At December 31, 2023, we had 116 full-time and part-time employees, compared to 141 at December 31, 2022, at which earlier date 49 employees were employed in our disposed outdoor advertising business.

To facilitate talent attraction and retention, we strive to create strong teams and vibrant culture at every level of our organization through our core values of integrity, innovation, excellence and safety.

1 unchanged sentence

We believe people can achieve their full potential when they enjoy their work, so it is our priority to provide a workplace where growth, success and fun go hand in hand.

We are implementing annual goal-setting and performance management processes, as well as formal surveys of our employees on a periodic and ongoing basis to measure engagement and identify areas for improvement.

We are implementing annual goal-setting and performance management processes to ensure the mission is executed, while ensuring transparency.

Code of Business Conduct

34 unchanged sentences

YEAR FIRST ELECTED OFFICER

Rahsan-Rahsan Lindsay Chief Executive Officer and Director 51 2021

Tobin President, Chief Operating Officer and General Counsel 40 2020

Kudjo Sogadzi Interim President and Chief Operating Officer 41 2023

Beemish Executive Vice President, Chief Financial Officer and Treasurer 51 2021

Lindsay was appointed to the position of Chief Executive Officer in June 2021.

Sogadzi was appointed to the position of Chief Operating Officer in July 2023 and interim President in October 2023.

Prior to joining MediaCo, Mr.

Lindsay served as the Executive Vice President of Advertising Sales and Marketing for Urban One, Inc.

for nine years, where he oversaw advertising sales, integrated marketing, and sales operations for TV One and sister network CLEO TV, which he helped launch in 2019.

In 2020, he took over as head of iOne Digital ad sales and One Solution, Urban One’s cross-platform marketing group, as well as One X Studios, the branded content production arm of Urban One.

Lindsay has been a member of the Advisory Board of Rutgers University School of Business since 2018.

In addition, he maintains a seat on the International Radio and Television Society board, a position that he has held for the past four years and serves as the co-chair of the board of directors for The Brotherhood/Sister Sol, a Harlem-based nonprofit organization providing education and personal development, career training and support services to underserved youth.

Tobin has served as President, Chief Operating Officer, and General Counsel since June 2021, after being appointed as Chief Operating Officer in August 2020.

Tobin has over 15 years of legal and operational experience.

Prior to joining the Company, Mr.

Tobin served as General Counsel, Chief Compliance Officer and Secretary of Standard Diversified Inc.

(a former affiliate of the Company), and before that served as the General Counsel and Senior Vice President of General Wireless Operations Inc.

d/b/a RadioShack.

Preceding this role, Mr.

Tobin served on the distressed debt team at Silver Point Capital, LP.

Sogadzi served as an investment analyst at Standard General LP since 2019.

He has also held positions as a Principal at OS Global LLC from 2015 to 2019, Hedge Fund Analyst at EnTrust Global, and serves on the board of Gloria Maris LLC.

Beemish was appointed to the position of Executive Vice President, Chief Financial Officer and Treasurer in November 2021.

29 unchanged sentences

The following table sets forth our current FCC license expiration dates in addition to the call letters, license classification, antenna elevation above average terrain, power and frequency of all owned stations as of December 31, 2023:

Radio Market Stations City of License Frequency Expiration

FCC Class Height Above

Terrain (in feet)

Radio Market Stations City of License Frequency Expiration Date

FCC Class Height Above Average Terrain (in feet)

(in Kilowatts)

9 unchanged sentences

As a result, the FCC’s Radio/Television Cross-Ownership Rule, which limited the number of radio and television and stations that could be commonly owned in a single market, was eliminated.

The FCC initiated its 2018 quadrennial review in December 2018 and that proceeding remains pending.

The 2022 quadrennial review was launched in December 2022 and that proceeding also remains pending.

We cannot predict whether either of the quadrennial review proceedings will result in modifications of the ownership rules or the impact (if any) that such modifications would have on our business.

The FCC completed its 2018 quadrennial review in December 2023, largely leaving its radio rules unchanged.

The 2022 quadrennial review was launched in December 2022 and that proceeding remains pending.

We cannot predict whether the 2022 quadrennial review proceedings will result in modifications of the ownership rules or the impact (if any) that such modifications would have on our business.

Attribution of Ownership Interests:

In applying its ownership rules, the FCC has developed specific criteria that it uses to determine whether a certain ownership interest or other relationship with an FCC licensee is significant enough to be “attributable” or “cognizable” under its rules, such that there would be a violation of the FCC’s rules where such person or entity holds attributable interests in more than the permitted number of stations or a prohibited combination of outlets in the same market.

The FCC’s regulations generally deem the following relationships and interests to be attributable for purposes of its ownership restrictions:

19 unchanged sentences

As a result, in a market where we own one or more radio stations, we generally cannot provide programming to another station under an LMA or sell advertising on another station pursuant to a JSA, if we could not acquire that station under the local radio ownership rule.

In the 2018 and 2022 quadrennial review proceedings, the FCC is considering all aspects of the local radio ownership rule, including whether the rule in its current form remains necessary in the public interest.

In the 2022 quadrennial review proceeding, the FCC is considering all aspects of the local radio ownership rule, including whether the rule in its current form remains necessary in the public interest.

Alien Ownership :

20 unchanged sentences

Additional Developments and Proposed Changes

The FCC has adopted rules implementing a low power FM (“LPFM”) service, and over 2000 such stations have been licensed.

The FCC has adopted rules implementing a low power FM (“LPFM”) service, and nearly 2000 such stations are currently licensed.

In November 2007, the FCC adopted rules that, among other things, enhance LPFM’s interference protection from subsequently-authorized full-service stations.

8 unchanged sentences

These copyright owners often rely on organizations known as performing rights organizations, which negotiate licenses with copyright users for the public performance of their compositions, collect royalties, and distribute them to copyright owners.

The three major performing rights organizations, from which the Company has licenses and to which we pay royalties, are the American Society of Composers, Authors, and Publishers (“ASCAP”), Broadcast Music, Inc.

(“BMI”), and SESAC, Inc.

The four major performing rights organizations, from which the Company has licenses and to which we pay royalties, are the American Society of Composers, Authors, and Publishers (“ASCAP”), Broadcast Music, Inc.

(“BMI”), SESAC, Inc., and Global Music Rights (“GMR”).

These rates are set periodically, are often negotiated by organizations acting on behalf of broadcasters, and may increase in the future.

It also is possible that songwriters or publishers may disassociate with these performing rights organizations, or that additional such organizations could emerge in the future.

In 2013 a new performing rights organization named Global Music Rights (“GMR”) was formed.

GMR has obtained the rights to certain high-value copyrights and has negotiated individual licensing agreements with radio stations for songs within its repertoire.

If a significant number of musical composition copyright owners withdraw from the established performing rights organizations, if new performing rights organizations form to license compositions that are not already licensed, or if the consent decrees between the DOJ and ASCAP/BMI are materially modified or eliminated, our royalty rates or negotiation costs could increase.

In order to stream music over the Internet, MediaCo must also obtain licenses and pay royalties to the owners of copyrights in sound recordings (typically, artists and record companies).

These royalties are in addition to royalties for Internet streaming that must be paid to performance rights organizations.

These royalties are in addition to royalties for Internet streaming that must be paid to performing rights organizations.

Legislation also has regularly been introduced in Congress that would require the payment of performance royalties to artists, musicians, or record companies whose music is played on terrestrial radio stations, ending a long-standing copyright law exception.

If enacted, such legislation could have an adverse impact on the cost of music programming.

If enacted, such legislation could have an adverse impact on the cost broadcast of music programming.

Congress and the FCC also have under consideration, and may in the future consider and adopt, new laws, regulations and policies regarding a wide variety of additional matters that could, directly or indirectly, affect the operation, ownership and profitability of our broadcast stations, result in the loss of audience share and advertising revenues for our broadcast stations and/or affect our ability to acquire additional broadcast stations or finance such acquisitions.

1 unchanged sentence

• proposals to impose spectrum use or other fees on FCC licensees;

• proposals to repeal or modify some or all of the FCC’s multiple ownership rules and/or policies;

• proposals to modify some or all of the FCC’s multiple ownership rules and/or policies;

• proposals to impose requirements intended to promote broadcasters’ service to their local communities;

5 unchanged sentences

• proposals, including by states, to limit the tax deductibility of advertising expenses by advertisers.

We cannot predict whether any proposed changes will be adopted, what other matters might be considered in the future, or what impact, if any, the implementation of any of these proposals or changes might have on our business.

We cannot predict whether any proposed changes will be adopted, what other matters might be considered in the future, or what impact, if any, the implementation of such proposals or changes might have on our business.

The foregoing is only a brief summary of certain provisions of the Communications Act and of specific FCC regulations.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business