Townsquare Media, Inc.

Previous wording

Townsquare is a community-focused digital media and marketing solutions company with market leading local radio stations, principally focused outside the top 50 markets in the U.S. Our integrated and diversified products and solutions enable local, regional and national advertisers to target audiences across multiple platforms, including digital, mobile, social, video, streaming, e-commerce, radio and events. Our assets include a subscription digital marketing services business (“Townsquare Interactive”), providing website design, creation and hosting, search engine optimization, social platforms and online reputation management as well as other monthly digital services for approximately 24,000 small to medium sized businesses; a robust digital advertising division (“Townsquare Ignite,” or “Ignite”), a powerful combination of (a) an owned and operated portfolio of more than 400 local news and entertainment websites and mobile apps along with a network of leading national music and entertainment brands, collecting valuable first party data and (b) a proprietary digital programmatic advertising technology stack with an in-house demand and data management platform; and a portfolio of 350 local terrestrial radio stations in 74 U.S. markets strategically situated outside the Top 50 markets in the United States. Our portfolio includes local media brands such as WYRK.com, WJON.com and NJ101.5.com, and premier national music brands such as XXLmag.com, TasteofCountry.com, UltimateClassicRock.com, and Loudwire.com.

Current wording

Townsquare is a community-focused digital and broadcast media and marketing solutions company principally focused outside the top 50 markets in the U.S. Townsquare Ignite, our robust digital advertising division, specializes in helping businesses of all sizes connect with their target audience through data-driven, results based strategies, by utilizing a) our proprietary digital programmatic advertising technology stack with an in-house demand and data management platform and b) our owned and operated portfolio of more than 400 local news and entertainment websites and mobile apps along with a network of leading national music and entertainment brands, collecting valuable first party data. Townsquare Interactive, our subscription digital marketing services business, partners with SMBs to help manage their digital presence by providing a SAAS business management platform, website design, creation and hosting, search engine optimization and other digital services. And through our portfolio of local radio stations strategically situated outside the Top 50 markets in the United States, we provide effective advertising solutions for our clients and relevant local content for our audiences.

Previous wording

Our primary sources of net revenue are the sale of digital and broadcast advertising solutions on our owned and operated websites, radio stations’ online streams and mobile applications, and on third party websites through our in-house digital programmatic advertising platform. Through our digital programmatic advertising platform, we are able to hyper-target audiences for our local, regional and national advertisers by combining first and third party audience and geographic location data, providing them the ability to reach a high percentage of their online audience. We deliver these solutions across desktop, mobile, connected TV, email, paid search and social media platforms utilizing display, video and native executions. We also offer subscription digital marketing solutions through Townsquare Interactive to small and medium-sized local and regional businesses in markets outside the top 50 across the United States, including, but not limited to the markets in which we operate radio stations. Our digital marketing solutions include traditional and mobile-enabled website development and hosting services, e-commerce platforms, search engine and online directory optimization services, online reputation monitoring and social media management.

Current wording

Our primary sources of net revenue are the sale of digital and broadcast advertising solutions on our owned and operated websites, radio stations’ online streams and mobile applications, radio stations, and on third party websites through our in-house digital programmatic advertising platform. Through our digital programmatic advertising platform, we are able to hyper-target audiences for our local, regional and national advertisers by combining first and third party audience and geographic location data, providing them the ability to reach a high percentage of their online audience. We deliver these solutions across desktop, mobile, connected TV, email, paid search and social media platforms utilizing display, video and native executions. We also offer subscription digital marketing solutions through Townsquare Interactive to small and medium-sized local and regional businesses in markets outside the top 50 across the United States, including, but not limited to the markets in which we operate radio stations. Our digital marketing solutions include a SAAS business management platform, traditional and mobile-enabled website development and hosting services, e-commerce platforms, search engine and online directory optimization services, online reputation monitoring and social media management.

Previous wording

Advertising revenue is highly correlated to changes in gross domestic product (“GDP”) as dollars spent on advertising has historically trended in line with, and in our experience often lags, changes in GDP. According to the U.S. Department of Commerce estimate as of January 25, 2024, U.S. GDP increased 2.5% for the year ended December 31, 2023.

Current wording

Advertising revenue is highly correlated to changes in gross domestic product (“GDP”) as dollars spent on advertising has historically trended in line with, and in our experience often lags, changes in GDP. According to the U.S. Department of Commerce estimate as of February 27, 2025, U.S. GDP increased 2.8% for the year ended December 31, 2024.

Previous wording

Our business enjoys strong cash flow generation owing to the relatively limited capital needs of our operations. During the year ended December 31, 2023, we recorded $15.0 million of capital expenditures, which represented 3.3% of net revenue during the same period. In addition, we benefit from certain tax attributes that generate tax deductions which have historically limited the amount of cash taxes we pay.

Current wording

Our business enjoys strong cash flow generation owing to the relatively limited capital needs of our operations. During the year ended December 31, 2024, we recorded $17.4 million of capital expenditures, which represented 3.9% of net revenue during the same period. In addition, we benefit from certain tax attributes that generate tax deductions which have historically limited the amount of cash taxes we pay.

Previous wording

•Net revenue for the year ended December 31, 2023, decreased $8.8 million, or 1.9%, as compared to the year ended December 31, 2022. Our Broadcast Advertising net revenue decreased $12.2 million, or 5.4% and our Subscription Digital Marketing Solutions net revenue decreased $8.2 million, or 9.1% as compared to the year ended December 31, 2022. These decreases were partially offset by a $9.9 million or 7.1% increase in our Digital Advertising net revenue and a $1.6 million, or 18.6%, increase in our Other net revenue.

Current wording

•Net revenue for the year ended December 31, 2024, decreased $3.2 million, or 0.7%, as compared to the year ended December 31, 2023. Our Subscription Digital Marketing Solutions net revenue decreased $6.9 million, or 8.4%, and our Broadcast Advertising net revenue decreased $2.8 million, or 1.3%, as compared to the year ended December 31, 2023. Our Other net revenue decreased $2.0 million, or 19.5% as compared to 2023. These decreases were largely offset by an $8.3 million, or 5.5%, increase in our Digital Advertising net revenue.

Previous wording

•Excluding revenue related to political advertising of $2.9 million and $7.5 million for the years ended December 31, 2023 and 2022, respectively, net revenue decreased $4.2 million, or 0.9% to $451.3 million. Broadcast Advertising net revenue decreased $7.8 million, or 3.6%, to $209.0 million and Digital Advertising net revenue increased $10.2 million, or 7.3%, to $150.1 million.

Current wording

•Excluding revenue related to political advertising of $13.4 million and $2.9 million for the years ended December 31, 2024 and 2023, respectively, net revenue decreased $13.8 million, or 3.0% to $437.6 million, Broadcast Advertising net revenue decreased $12.6 million, or 6.1%, to $196.4 million, and Digital Advertising net revenue increased $7.7 million, or 5.1%, to $157.8 million.

Previous wording

•Operating income decreased $74.7 million to an operating loss of $19.1 million for the year ended December 31, 2023, as compared to operating income of $55.6 million for the year ended December 31, 2022. Operating income decreased due to an increase in total non-cash impairment charges of $59.5 million, the $8.8 million decrease in net revenue as discussed above, an increase in stock-based compensation of $4.2 million and an increase in direct operating expenses of $4.3 million. These increases were partially offset by a $3.3 million decrease in transaction and business realignment costs.

Current wording

•Operating income increased $40.8 million to $21.7 million for the year ended December 31, 2024, as compared to an operating loss of $19.1 million for the year ended December 31, 2023. Operating income increased due to a decrease in total non-cash impairment charges of $52.9 million and a $3.6 million decrease in direct operating and corporate expenses. These decreases were partially offset by an increase in stock-based compensation of $9.1 million, a $3.7 million increase in transaction and business realignment costs and the $3.2 million decrease in net revenue discussed above.

Previous wording

•Our Broadcast Advertising segment reported an operating loss of $33.8 million, compared to operating income of $27.6 million for the year ended December 31, 2022, due to an increase in total non-cash impairment charges of $47.5 million and the $12.2 million decrease in net revenue. Our Subscription Digital Marketing Solutions segment reported operating income of $21.3 million, a decrease of $3.0 million from 2022, due to the $8.2 million decrease in net revenue, partially offset by a $5.3 million decrease in direct operating expenses. Our Digital Advertising segment reported operating income of $44.9 million, an increase of $2.8 million from 2022, due to the $9.9 million increase in net revenues, partially offset by a $6.7 million increase in direct operating expenses.

Current wording

•Our Broadcast Advertising segment reported operating income of $19.0 million, compared to an operating loss of $33.8 million for the year ended December 31, 2023, due to a decrease in total non-cash impairment charges of $43.1 million and an $8.9 million decrease in direct operating expenses, partially offset by the $2.8 million decrease in net revenue. Our Digital Advertising segment reported operating income of $37.3 million, a decrease of $7.6 million from 2023, due to a $13.5 million increase in direct operating expenses, partially offset by an $8.3 million increase in net revenues. Our Subscription Digital Marketing Solutions segment reported operating income of $18.4 million, a decrease of $2.9 million from 2023, due to the $6.9 million decrease in net revenue, partially offset by a $5.0 million decrease in direct operating expenses.

Previous wording

The following table presents the Company's reportable segment net revenue and direct operating expenses for each of the years ended December 31, 2023 and 2022, respectively (in thousands):

Current wording

The following table presents the Company's reportable segment net revenue, direct operating expenses, and profit for each of the years ended December 31, 2024 and 2023, respectively (in thousands):

Previous wording

Net revenue for the year ended December 31, 2023 decreased by $8.8 million, or 1.9%, as compared to the same period in 2022. Our Broadcast Advertising net revenue decreased $12.2 million, or 5.4%, due to decreases in the purchases of advertising by our clients. Our Subscription Digital Marketing Solutions net revenue decreased $8.2 million, or 9.1% as compared to the year ended December 31, 2022, due to a reduction of net subscribers. These decreases were partially offset by a $9.9 million, or 7.1%, increase in our Digital Advertising net revenue due to purchases of new advertising and a $1.6 million, or 18.6%, increase in our Other net revenue due to an increase in live events held during 2023.

Current wording

Net revenue for the year ended December 31, 2024 decreased by $3.2 million, or 0.7%, as compared to the same period in 2023. Our Broadcast Advertising net revenue decreased $2.8 million, or 1.3%, due to decreases in the purchases of advertising by our clients. Our Subscription Digital Marketing Solutions net revenue decreased $6.9 million, or 8.4% as compared to the year ended December 31, 2023, due to a reduction in net subscribers. Other net revenue decreased $2.0 million, or 19.5%, due to the elimination of low profit events in 2024. These decreases were partially offset by a $8.3 million, or 5.5%, increase in our Digital Advertising net revenue due to purchases of new advertising.

Previous wording

Direct operating expenses for the year ended December 31, 2023 increased by $4.3 million, or 1.3%, when compared with the same period in 2022. Our Digital Advertising direct operating expenses increased $6.7 million, or 6.9%, primarily driven by higher inventory costs and headcount related expenses to support revenue growth. Other direct operating expense increased $2.2 million, or 28.2%, due to an increase in live events held during 2023. Our Subscription Digital Marketing Solutions direct operating expenses decreased $5.3 million, or 8.3%, as compared to the same period in 2022. The decrease was primarily driven by lower compensation and sales expenses. Our Broadcast Advertising direct operating expenses for the year ended December 31, 2023 increased $0.7 million, or 0.5%, as compared to 2022.

Current wording

Direct operating expenses for the year ended December 31, 2024 decreased by $2.4 million, or 0.7%, when compared with the same period in 2023. Our Broadcast Advertising direct operating expenses for the year ended December 31, 2024 decreased $8.9 million, or 5.7%, as compared to 2023, primarily due to lower compensation costs. Our Subscription Digital Marketing Solutions direct operating expenses decreased $5.0 million, or 8.6%, as compared to the same period in 2023. The decrease was primarily driven by lower compensation costs and lower bad debt expense. Other direct operating expense decreased $2.0 million, or 20.3%, due to the elimination of low profit events. Our Digital Advertising direct operating expenses increased $13.5 million, or 13.0%, primarily driven by higher inventory and compensation costs, as well as an increase in bad debt, each as compared to 2023.

Previous wording

Stock-based compensation expense for the year ended December 31, 2023 increased $4.2 million, or 111.6%, as compared to the same period in 2022, due to grants during the fourth quarter of 2022 and the first quarter of 2023. For further discussion, see Note 11, Stockholders' Equity, in the Notes to the Consolidated Financial Statements.

Current wording

Stock-based compensation expense for the year ended December 31, 2024 increased $9.1 million, or 113.8%, due to $4.6 million in expense recognized related to the cash settlement of options, $3.8 million of expense recognized for the stock bonus program and due to grants during the fourth quarter of 2023 and the first quarter of 2024. For further discussion, see Note 10, Stockholders' Deficit, in the Notes to Consolidated Financial Statements.

Previous wording

Transaction and business realignment costs for the year ended December 31, 2023 decreased $3.3 million, or 73.7%, as compared to 2022, primarily due to the Cherry Creek acquisition during 2022.

Current wording

Transaction and business realignment costs for the year ended December 31, 2024 increased $3.7 million, or 319.6%, as compared to 2023, due to local market operational cost reduction efforts.

Previous wording

The Company recorded total impairment charges of $90.6 million related to intangible assets, investments, goodwill, and long-lived assets during the year ended December 31, 2023. We recorded total impairment charges of $70.9 million related to FCC licenses in 36 of our 74 local markets during the year ended December 31, 2023, as compared to $26.1 million of impairment charges related to FCC licenses in nine of our 74 local markets during the year ended December 31, 2022. The impairment charges were primarily driven by an increase in the discount rate applied in the valuation of our FCC licenses due to an increase in the weighted average cost of capital, decreases in third-party forecasts of broadcast revenues and an increase in the estimate of initial capital costs due to rising prices.

Current wording

The Company recorded total impairment charges of $37.7 million related to intangible assets, investments, goodwill, and long-lived assets during the year ended December 31, 2024, as compared to $90.6 million in total impairment charges during the year ended December 31, 2023. We recorded total impairment charges of $30.9 million related to FCC licenses in 27 of our 74 local markets during the year ended December 31, 2024, as compared to $70.9 million of impairment charges related to FCC licenses in 36 of our 74 local markets during the year ended December 31, 2023. The impairment charges were primarily driven by increases in the discount rate applied in the valuation of our FCC licenses due to an increase in the weighted average cost of capital and decreases in third-party forecasts of broadcast revenues.

Previous wording

Unfavorable changes in key assumptions utilized in the impairment assessment of our FCC licenses may affect future testing results. For example, keeping all other assumptions constant, a 50-basis point increase in the weighted average cost of capital as of the date of our last quantitative assessment performed as of December 31, 2023 would have caused the estimated fair values of our FCC licenses to decrease by $13.0 million which would have resulted in an additional impairment charge of $9.9 million. Further, a 100-basis point decline in the long-term revenue growth rate would cause the estimated fair values of our FCC licenses to further decrease by $17.1 million which would have resulted in a further impairment charge of $14.0 million as of December 31, 2023. Assumptions used to estimate the fair value of our FCC licenses are also dependent upon the expected performance and growth of our traditional broadcast operations. In the event broadcast revenue experiences actual or anticipated declines, such declines will have a negative impact on the estimated fair value of our FCC licenses, and the Company could recognize additional impairment charges, which could be material.

Current wording

Unfavorable changes in key assumptions utilized in the impairment assessment of our FCC licenses may affect future testing results. For example, keeping all other assumptions constant, a 100-basis point increase in the weighted average cost of capital as of the date of our last quantitative assessment performed as of December 31, 2024 would have caused the estimated fair values of our FCC licenses to decrease by $21.1 million which would have resulted in an additional impairment charge of $1.2 million. Further, a 100-basis point decline in the long-term revenue growth rate would cause the estimated fair values of our FCC licenses to further decrease by $12.6 million which would have resulted in a further impairment charge of $4.0 million as of December 31, 2024. Finally, a 100-basis point decline in operating profit margins would result in a decrease in the estimated fair values of our FCC licenses of $9.9 million which would result in an impairment charge of $6.2 million. Assumptions used to estimate the fair value of our FCC licenses are also dependent upon the expected performance and growth of our traditional broadcast operations. In the event broadcast revenue experiences actual or anticipated declines, such declines will have a negative impact on the estimated fair value of our FCC licenses, and the Company could recognize additional impairment charges, which could be material.

Previous wording

Unfavorable changes in certain key assumptions utilized in determining the fair values of each of our reporting units, may affect future testing results. For example, keeping all other assumptions constant, a 100-basis point increase in the weighted average cost of capital assumption for each of our reporting units would cause the estimated fair values of our National Digital, Townsquare Ignite, Analytical Service, Townsquare Interactive and Live Events reporting units to decline, resulting in a decrease in the fair value in excess of their respective carrying values by approximately 6%, 5%, 8%, 9%, and 4%, respectively. Further, keeping all other assumptions constant, a 10% decline in the estimated fair value of each reporting unit, due to other changes in assumptions, including forecasted future cash flows, would have resulted in an incremental goodwill impairment charge of approximately $0.3 million for the Live Events reporting unit.

Current wording

Unfavorable changes in certain of these key assumptions may affect future testing results. For example, keeping all other assumptions constant, a 100-basis point increase in the weighted average cost of capital assumption for each of our reporting units would cause the estimated fair values of our National Digital, Townsquare Ignite, Analytical Service and Townsquare Interactive reporting units to decline, resulting in a decrease in the fair value in excess of their respective carrying values by approximately 4%, 6%, 8%, and 8%, respectively. Further, keeping all other assumptions constant, a 10% decline in the estimated fair value of each reporting unit, due to other changes in assumptions, including forecasted future cash flows, would not have resulted in goodwill impairment charges for the year ended December 31, 2024.

Previous wording

During the year ended December 31, 2023, the Company recorded an impairment charge of $14.5 million related to certain of its equity securities, which are measured at cost minus impairment. The Company recorded an impairment charge of $1.2 million related to one of our investments during the year ended December 31, 2022. For further discussion, see Note 7, Investments, in the Notes to Consolidated Financial Statements.

Current wording

During the year ended December 31, 2024, the Company recorded total impairment charges of $2.0 million related to certain of its equity securities, which are measured at cost minus impairment. The Company recorded total impairment charges of $14.5 million related to certain of its investment securities during 2023. For further discussion, see Note 6, Investments, in the Notes to Consolidated Financial Statements.

Previous wording

Gain on Repurchase of Debt

Current wording

Loss (Gain) on Repurchase of Debt

Previous wording

During the year ended December 31, 2023, one of the Company's investments was acquired in a private transaction. The Company recognized a $5.2 million gain on the transaction, based on total consideration received in the amount of $6.0 million. See Note 7, Investments, in the Notes to the Consolidated Financial Statements for further discussion related to this investment.

Current wording

In February of 2024, one of the Company’s investees announced the completion of its acquisition in a private transaction. The Company recognized a $4.0 million gain on the transaction. During the twelve months ended December 31, 2023, one of the Company's investees was acquired as a result of a private transaction. The Company recognized a $5.2 million gain on the transaction. See Note 6, Investments, in the Notes to the Consolidated Financial Statements for further discussion related to these investments.

Previous wording

During the year ended December 31, 2023, the Company sold its digital assets with a carrying value of $2.1 million, recognizing a gain on the sale of $0.8 million. For further discussion, see Note 6, Goodwill and Other Intangible Assets in the Notes to Consolidated Financial Statements.

Current wording

During the year ended December 31, 2023, the Company sold its digital assets with a carrying value of $2.1 million, recognizing a gain on the sale of $0.8 million. For further discussion, see Note 5, Goodwill and Other Intangible Assets, Netin the Notes to Consolidated Financial Statements.

Previous wording

Other (income) expense, net includes unrealized losses related to measuring the fair value of one of the Company's investees. During the year ended December 31, 2023, the Company recorded a total unrealized net loss of $0.4 million, as compared to $2.1 million during 2022. See Note 7, Investments, in our Notes to Consolidated Financial Statements for further discussion related to this investment.

Current wording

Other (income) expense, net includes unrealized losses related to measuring the fair value of one of the Company's former investees that was sold during 2024. Prior to its sale, the Company recognized a total unrealized net gain of $0.2 million as a result of changes in the fair value of the investee's common stock during 2024. The Company recorded a total unrealized net loss of $0.4 million based on changes in the market price of the investee's common stock during 2023. See Note 6, Investments, in our Notes to Consolidated Financial Statements for further discussion related to this investment.

Previous wording

We recognized an income tax benefit of $6.1 million for the year ended December 31, 2023 as compared to $0.6 million for the same period in 2022. Our effective tax rate was approximately 12.5% for the year ended December 31, 2023 as compared to (4.1)% for the year ended December 31, 2022. The increase in the effective tax rate is primarily driven by an increase in the valuation allowance for interest expense carryforward.

Current wording

We recognized an income tax provision of $1.3 million for the year ended December 31, 2024 as compared to a benefit from income taxes of $6.1 million for 2023. Our effective tax rate was approximately 13.6% for the year ended December 31, 2024 as compared to 12.5% for the year ended December 31, 2023. The increase in the effective tax rate is primarily driven by an increase in the valuation allowance for interest expense carryforwards and certain non-deductible items.

Previous wording

Net cash provided by operating activities was $67.8 million for the year ended December 31, 2023, as compared to $50.2 million for the same period in 2022. This increase was primarily related to lower prepaid expenses and accounts receivable, as well as higher accounts payable and accrued expenses due to the timing of payments.

Current wording

Net cash provided by operating activities was $48.7 million for the year ended December 31, 2024, as compared to $67.8 million for the same period in 2023. This decrease was primarily related to changes in working capital balances, particularly prepaid and accrued expenses.

Previous wording

Net cash used in investing activities was $3.6 million for the year ended December 31, 2023, as compared to $37.8 million for the same period in 2022. The decrease in net cash used in investing activities was primarily due to the payment for the Cherry Creek acquisition of $18.5 million and the purchase of digital assets of $5.0 million during 2022 that did not reoccur in 2023. Additionally, during the year ended December 31, 2023, the Company received cash proceeds of $7.7 million and $3.0 million related to the sales of assets and investment related transactions and digital assets, respectively.

Current wording

Net cash used in investing activities was $9.9 million for the year ended December 31, 2024, as compared to $3.6 million for the same period in 2023. The increase in net cash used in investing activities was primarily due to cash proceeds of $3.0 million related to the sales of digital assets in 2023 that did not reoccur in 2024, a $2.5 million increase in purchases of property and equipment, and a $0.6 million decrease in proceeds from the sale of assets and investment related transactions.

Previous wording

Net cash used in financing activities was $46.6 million for the year ended December 31, 2023, as compared to $19.5 million for the same period in 2022. The increase in net cash used in financing activities was primarily due to a $16.4 million increase in stock repurchases, $6.8 million of incremental repurchases of 2026 Notes in 2023 as compared to 2022, and dividend payments of $9.3 million in 2023, partially offset by an increase in proceeds from stock options exercised.

Current wording

Net cash used in financing activities was $67.4 million for the year ended December 31, 2024, as compared to $46.6 million for the same period in 2023. The increase in net cash used in financing activities was primarily due to $10.4 million of incremental repurchases of 2026 Notes in 2024 as compared to 2023, a $6.9 million increase in stock repurchases, and a $3.0 million increase in dividend payments, partially offset by an increase in proceeds from stock options exercised.

Previous wording

We fund our working capital requirements through a combination of cash flows from our operating, investing, and financing activities. Based on current and anticipated levels of operations and conditions in our markets and industry, we believe that our cash on hand and cash flows from our operating, investing, and financing activities will enable us to meet our working capital, capital expenditures, dividend payments, debt service, and other funding requirements for at least one year from the date of this report. Future capital requirements may be materially different than those currently planned in our budgeting and forecasting activities and depend on many factors, some of which are beyond our control. In particular during the period of uncertainty related to the COVID-19 pandemic, we focused on and will continue to monitor our liquidity.

Current wording

We fund our working capital requirements through a combination of cash flows from our operating, investing, and financing activities. Based on current and anticipated levels of operations and conditions in our markets and industry, we believe that our cash on hand and cash flows from our operating, investing, and financing activities will enable us to meet our working capital, capital expenditures, debt service, dividend payments, and other funding requirements for at least one year from the date of this report. Future capital requirements may be materially different than those currently planned in our budgeting and forecasting activities and depend on many factors, some of which are beyond our control. We are focused on and will continue to monitor our liquidity.

Previous wording

As of December 31, 2023, we had $499.7 million of outstanding indebtedness, net of deferred financing costs of $4.0 million.

Current wording

As of December 31, 2024, we had $465.8 million of outstanding indebtedness, net of deferred financing costs of $1.7 million. On February 19, 2025 we entered into a $490 million Credit Agreement, as discussed Note 14, Subsequent Events, in our Notes to Consolidated Financial Statements. The net proceeds from the Credit Agreement, together with cash on hand, was used to repay all of the outstanding 2026 Notes on February 19, 2025, and to pay the fees and expenses related thereto. Based on the terms of our 2026 Notes and the Credit Agreement, as of December 31, 2024, we expect our debt service requirements to be approximately $60.0 million over the next twelve months.

Previous wording

As of December 31, 2023, we had $61.0 million of cash and cash equivalents, $60.8 million of receivables from customers, which historically have had an average collection cycle of approximately 55 days. We had restricted cash of $0.5 million as of December 31, 2023 and 2022, respectively, that was held as collateral in connection with certain agreements. From time to time, such restricted funds could be returned to us or we could be required to pledge additional cash.

Current wording

As of December 31, 2024, we had $33.0 million of cash and cash equivalents, $60.6 million of receivables from customers, which historically have had an average collection cycle of approximately 50 days.

Previous wording

On November 6, 2023, the board of directors approved a quarterly dividend of $0.1875 per share. The $3.1 million dividend was paid to holders of record as of January 2, 2024 on February 1, 2024. On February 28, 2024, the board of directors approved a quarterly dividend of $0.1975 per share. The dividend will be paid to holders of record as of April 5, 2024 on May 1, 2024.

Current wording

On October 28, 2024, the board of directors approved a quarterly dividend of $0.1975 per share. The $3.1 million dividend was paid to holders of record as of January 21, 2025 on February 1, 2025. On March 13, 2025, the board of directors approved a quarterly dividend of $0.20 per share. The dividend will be paid to holders of record as of April 17, 2025 on May 1, 2025.

Previous wording

On June 16, 2023, the Company repurchased 1.5 million shares of the Company’s Class C common stock in the aggregate amount of $14.6 million from MSG National Properties, LLC ("MSG"). The shares were retired upon repurchase. Additionally, the Company repurchased approximately 0.2 million shares of Class A common stock for approximately $2.1 million, during the twelve months ended December 31, 2023.

Current wording

On April 1, 2024, the Company repurchased 1.5 million shares of the Company’s Class A common stock in the aggregate amount of $14.6 million from MSG National Properties, LLC (“MSG”). The shares were retired upon repurchase. Additionally, the Company repurchased 0.8 million shares of Class A common stock for approximately $9.0 million during the year ended December 31, 2024.

Previous wording

Our anticipated uses of cash in the near term include working capital needs, interest payments, dividend payments, other obligations, and capital expenditures. The Company believes that the cash generated by its operations should be sufficient to meet its liquidity needs for at least the next 12 months. However, our ability to fund our working capital needs, dividend payments, debt payments, other obligations, capital expenditures, and to comply with financial covenants under our debt agreements, depends on our future operating performance and cash flow, which are in turn subject to prevailing economic conditions, increases or decreases in advertising spending, changes in the highly competitive industry in which we operate, which may be rapid, and other factors, many of which are beyond our control. To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities and requirements, we may be required to seek additional equity or debt financing. The sale of additional equity would result in additional dilution to our stockholders, while the incurrence of debt financing would result in debt service obligations. Such debt instruments could introduce covenants that might restrict our operations. We cannot assure you that we could obtain additional financing on favorable terms or at all.

Current wording

Our anticipated uses of cash in the near term include working capital needs, interest payments, dividend payments, excess cashflow payments that may be required under the terms of the Credit Agreement, other obligations, and capital expenditures. The Company believes that the cash generated by its operations should be sufficient to meet its liquidity needs for at least the next 12 months. However, our ability to fund our working capital needs, debt payments, dividend payments, other obligations, capital expenditures, and to comply with financial covenants under our debt agreements, depends on our future operating performance and cash flow, which are in turn subject to prevailing economic conditions, increases or decreases in advertising spending, changes in the highly competitive industry in which we operate, which may be rapid, and other factors, many of which are beyond our control. To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities and requirements, we may be required to seek additional equity or debt financing. The sale of additional equity would result in additional dilution to our stockholders, while the incurrence of debt financing would result in debt service obligations. Such debt instruments could introduce covenants that might restrict our operations. We cannot assure you that we could obtain additional financing on favorable terms or at all.

Previous wording

The key assumptions using the greenfield method are market revenue growth rates, market share, profit margin and duration and profile of the build-up period, the risk-adjusted discount rate and terminal values. This data is populated using industry normalized information representing an average FCC license within a market. The projections incorporated into our license valuations take into consideration the then current economic conditions. Each of these assumptions may change in the future based upon changes in general economic conditions, audience behavior, consummated transactions, and numerous other variables that may be beyond our control.

Current wording

The key assumptions using the Greenfield method are market revenue growth rates, market share, profit margin and the risk-adjusted discount rate. This data is populated using industry normalized information representing an average FCC license within a market. The projections incorporated into our license valuations take into consideration the then current economic conditions. Each of these assumptions may change in the future based upon changes in general economic conditions, audience behavior, consummated transactions, and numerous other variables that may be beyond our control.

Previous wording

For further discussion on the fair value of option awards, see Note 11, Equity, in our Notes to Consolidated Financial Statements.

Current wording

For further discussion on the fair value of option awards, see Note 10, Stockholders’ Deficit, in our Notes to Consolidated Financial Statements.

Previous wording

We evaluate the need for valuation allowances to reduce the deferred tax assets to realizable amounts. Management evaluates all positive and negative evidence and uses judgment regarding past and future events, including operating results, to help determine when it is more likely than not that all or some portion of the deferred tax assets may not be realized. When appropriate, a valuation allowance is recorded against deferred tax assets to offset future tax benefits that may not be realized. As of December 31, 2023, the Company has recorded $38.5 million of valuation allowance against its net operating losses and tax credit carry forwards. Revisions to our forecasts or declining macroeconomic conditions could result in changes to our assessment of the realization of these deferred income tax assets.

Current wording

We evaluate the need for valuation allowances to reduce the deferred tax assets to realizable amounts. Management evaluates all positive and negative evidence and uses judgment regarding past and future events, including operating results, to help determine when it is more likely than not that all or some portion of the deferred tax assets may not be realized. When appropriate, a valuation allowance is recorded against deferred tax assets to offset future tax benefits that may not be realized. As of December 31, 2024, the Company has recorded $35.8 million of valuation allowance against its interest expense carryforwards, net operating losses and tax credit carry forwards. Revisions to our forecasts or declining macroeconomic conditions could result in changes to our assessment of the realization of these deferred income tax assets.