NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(1) Interim Financial Statements
The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements
of Beasley Broadcast Group, Inc. and its subsidiaries (the Company) included in the Companys Annual Report on Form
10-K
for the year ended December 31, 2016. These financial statements
have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form
10-Q
and Article 10 of Regulation
S-X.
Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the financial statements reflect all adjustments necessary
for a fair statement of the financial position and results of operations for the interim periods presented and all such adjustments are of a normal and recurring nature. The Companys results are subject to seasonal fluctuations therefore the
results shown on an interim basis are not necessarily indicative of results for the full year.
(2) Recent Accounting
Pronouncements
In March 2017, the Financial Accounting Standards Board (FASB) issued guidance to improve the presentation
of net periodic pension cost and net periodic postretirement benefit cost. The new guidance is effective for annual periods beginning after December 15, 2017. The Company is currently in the process of reviewing the new guidance, but its
preliminary assessment, which is subject to change, is that the new guidance will not result in a significant impact on its financial statements.
In January 2017, the FASB issued guidance to simplify goodwill impairment testing by eliminating step two from the goodwill impairment test.
Under the new guidance, an entity still has the option to perform the qualitative assessment of a reporting unit to determine if the quantitative impairment test is necessary. Under the new guidance an entity should perform its annual, or interim,
goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting units fair value; however, the
loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The new guidance is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill
impairment tests performed after January 1, 2017. The Company has adopted the new guidance on a prospective basis in the first quarter of 2017 with no current impact on its financial statements.
In August 2016, the FASB issued guidance to reduce diversity in practice in how certain cash receipts and cash payments are presented and
classified in the statement of cash flows. The new guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption permitted. The Company is currently in the process
of reviewing the new guidance, but its preliminary assessment, which is subject to change, is that the new guidance will not result in a significant impact on its financial statements.
In March 2016, the FASB issued guidance to improve several aspects of the accounting for share-based payment transactions, including the
income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The new guidance is effective for annual periods beginning after December 15, 2016 and interim periods within
those annual periods. The Company adopted the new guidance in the first quarter of 2017 with no material impact on its financial statements.
In February 2016, the FASB issued guidance to increase transparency and comparability among organizations by recognizing lease assets and
lease liabilities on the balance sheet and disclosing key information about leasing arrangements. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a
right-of-use
asset representing its right to use the underlying asset for the lease term. There continues to be a differentiation between finance leases and operating leases,
however lease assets and lease liabilities arising from operating leases should now be recognized in the statement of financial position. New disclosures are required to meet the objective of enabling users of financial statements to assess the
amount, timing, and uncertainty of cash flows arising from leases. The new guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company continues to review the new
guidance and is currently researching lease management software. The Company expects the new guidance to result in a significant impact on the balance sheet, however that impact will not be quantified until closer to the adoption date. The Company
does not expect the new guidance to have a significant impact on the statement of comprehensive income.
In January 2016, the FASB issued
guidance that changes how entities measure equity investments and present changes in the fair value of financial liabilities. The new guidance requires entities to measure equity investments that do not result in consolidation and are not accounted
under the equity method at fair value and recognize any changes in fair value in net income unless the investments
6
BEASLEY BROADCAST GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
qualify for the new practicality exception. A practicality exception will apply to those equity investments that do not have a readily determinable fair value and do not qualify for the practical
expedient to estimate fair value, and as such, these investments may be measured at cost. The new guidance is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company
continues to review the new guidance, but its preliminary assessment, which is subject to change, is that the new guidance will not result in a significant impact on its financial statements.
In September 2015, the FASB issued guidance that modified accounting for business combinations to reflect measurement period adjustments to be
recorded prospectively rather than retroactively to the assets and liabilities initially recorded under purchase price accounting. The guidance, which was effective as of January 1, 2016, did not have a material impact on the Companys
financial statements at the time of adoption. During the first quarter of 2017, the Company did account for measurement period adjustments on a prospective basis. See Note 3 for further information.
In May 2014, the FASB issued guidance to clarify the principles for recognizing revenue. The core principle of the guidance is that an entity
should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides a
comprehensive framework for revenue recognition that supersedes current general revenue guidance and most industry-specific guidance. In addition, the guidance requires improved disclosures to help users of financial statements better understand the
nature, amount, timing, and uncertainty of revenue that is recognized. In 2016, the FASB issued several updates to address implementation issues and to clarify guidance for principal versus agent considerations and identifying performance
obligations and licensing. An entity should apply the guidance either retrospectively to each prior reporting period presented or retrospectively with the cumulative adjustment at the date of the initial application. In August 2015, the FASB delayed
the effective date of the new guidance to annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is now permitted after the original effective
date of December 15, 2016. The Company plans to adopt the new guidance on January 1, 2018. The Company continues to review the impact of the new guidance on its revenue streams and its initial assessment is that the new guidance will not
result in a significant impact on its financial statements. The Company preliminarily plans to adopt the new guidance using the retrospective application method.
(3) Acquisitions and Dispositions
Greater Media Merger
On
November 1, 2016, (the Acquisition Date), the Company completed the acquisition of Greater Media, Inc. (Greater Media), pursuant to the merger agreement, dated as of July 19, 2016 by and among the Company, Greater
Media, Beasley Media Group 2, Inc., an indirect wholly-owned subsidiary of the Company (Merger Sub), and Peter A. Bordes, Jr., as the Stockholders Representative (the Merger Agreement). On the Closing Date, Merger Sub
was merged with and into Greater Media, with Greater Media surviving the merger as an indirect wholly-owned subsidiary of the Company (the Merger). As a result of the Merger, the Company added 21 radio stations in the Boston, MA,
Detroit, MI, Charlotte, NC, Middlesex, NJ, Monmouth, NJ, Morristown, NJ and Philadelphia, PA markets.
Pursuant to the terms of the Merger
Agreement, at the effective time of the Merger, the Company acquired all of the issued and outstanding common stock of Greater Media for an aggregate purchase price of $239,875,000, subject to a purchase price adjustment related to the sale of
Greater Medias tower assets and other customary post-closing purchase price adjustments and inclusive of the repayment of $82.2 million of Greater Medias outstanding debt and the payment of certain transaction expenses. The proceeds
paid to the stockholders of Greater Media consisted of (i) $94.4 million in cash and (ii) $25.0 million in shares of the Companys Class A common stock, which equaled 5,422,993 shares at a fixed value of $4.61 per share (the
Merger Shares). The 5,422,993 shares of Class A common stock were recorded at a fair value of $4.80 per share or $26.0 million on the Acquisition Date. The Merger consideration is subject to adjustment for changes in working
capital of Greater Media, outstanding debt of Greater Media and its subsidiaries as of the date of the closing and certain other payments and expenses. Additional Merger Shares may be issued in connection with such adjustment. In addition, the
stockholders of Greater Media will receive the net cash proceeds from the sale of Greater Medias tower assets, originally estimated to be approximately $24.0 million. Merger expenses of $0.5 million are reported on a separate line in
the consolidated statement of comprehensive income for the three months ended March 31, 2017.
The acquisition was accounted for as a
business combination. The preliminary purchase price allocations are based on a preliminary valuation of assets and liabilities and the 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.
7
BEASLEY BROADCAST GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The Company has engaged a third party to evaluate certain net operating loss carryforwards
related to Greater Media, Inc. and several of its subsidiaries to determine the amount of net operating loss carryforwards that may be utilized by the Company in future tax returns. These evaluations have not been finalized therefore an estimate of
$3.6 million for net operating loss carryforwards has been included in the preliminary purchase price. The accounting for this item is preliminary and will be adjusted once finalized during the measurement period.
On the Acquisition Date, in accordance with the Merger Agreement, the Company placed 867,679 shares of Class A common stock with a fair
value of $4.2 million in escrow. Some or all of these shares could be released to Greater Media based upon a working capital adjustment which may not be finalized until the second quarter of 2017. The Companys estimate of the working
capital adjustment as of the Acquisition Date, results in 189,915 shares of Class A common stock being released to Greater Media. The unreleased shares in escrow will be canceled by the Company. The forfeited shares are not indexed to the
Companys stock therefore are adjusted to fair value based on the Companys closing stock price on each reporting date with changes in fair value recorded in earnings. The estimated number of shares to be released to Greater Media have a
fair value of $0.9 million as of the Acquisition Date and have been included in the preliminary purchase price. The estimated number of shares to be forfeited have a fair value of $3.3 million as of the Acquisition Date and have been
reported as a merger consideration receivable in the accompanying consolidated balance sheet. The Company reassessed the fair value of the estimated number of shares to be forfeited and recorded a $3.7 million change in fair value of the
contingent consideration for the three months ended March 31, 2017. The final purchase price will include the fair value of the forfeited shares as of the settlement date of the working capital adjustment. The accounting for this item is
preliminary and will be adjusted once finalized during the measurement period.
In accordance with the Merger Agreement, the purchase
price will be adjusted by certain proceeds from the sale of Greater Medias towers assets. Based on the proceeds from the tower sale, the former stockholders of Greater Media will return a certain number of shares of Class A common stock
that will be canceled by the Company. The Company has accounted for this arrangement as contingent consideration subject to the ultimate sale of the tower assets. As of the Acquisition Date, the Company estimated the sales price of the towers to be
$28.0 million which resulted in the expected return of 650,759 shares. As of the Acquisition Date, the estimated number of shares to be returned had a fair value of $3.4 million based on a stock price of $5.16 and have been reported as a
merger consideration receivable in the accompanying consolidated balance sheet. On February 27, 2017, the former stockholders of Greater Media entered into an asset purchase agreement to sell the towers for $28.0 million. As of
March 31, 2017, the estimated number of shares to be returned had a fair value of $7.5 million based on a stock price of $11.60. The Company recorded a $3.8 million change in fair value of the contingent consideration for the three
months ended March 31, 2017. The number of returned shares may be revised due to a change in the estimated net proceeds from the tower sale. The accounting for this item is preliminary and will be adjusted once finalized during the measurement
period.
The following table summarizes the preliminary purchase price allocation as of the Acquisition Date:
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
7,683,950
|
|
Accounts receivable
|
|
|
29,889,677
|
|
Prepaid expenses
|
|
|
1,710,924
|
|
Other current assets
|
|
|
541,460
|
|
Property and equipment
|
|
|
40,642,648
|
|
FCC broadcasting licenses
|
|
|
263,260,200
|
|
Other intangibles, net
|
|
|
2,790,524
|
|
Other assets
|
|
|
676,632
|
|
Accounts payable
|
|
|
(429,042
|
)
|
Other current liabilities
|
|
|
(16,685,309
|
)
|
Long-term debt
|
|
|
(82,177,895
|
)
|
Deferred tax liabilities
|
|
|
(76,050,112
|
)
|
Other long-term liabilities
|
|
|
(13,709,261
|
)
|
|
|
|
|
|
Net assets acquired
|
|
|
158,144,396
|
|
Gain on merger
|
|
|
(44,281,066
|
)
|
|
|
|
|
|
Preliminary purchase price
|
|
$
|
113,863,330
|
|
|
|
|
|
|
8
BEASLEY BROADCAST GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The following table summarizes the components of the preliminary purchase price:
|
|
|
|
|
Cash
|
|
$
|
94,444,148
|
|
Stock issued
|
|
|
21,865,506
|
|
Estimated tower sale adjustment
|
|
|
(3,357,916
|
)
|
Stock issued in escrow
|
|
|
4,164,859
|
|
Estimated working capital adjustment
|
|
|
(3,253,267
|
)
|
|
|
|
|
|
Preliminary purchase price
|
|
$
|
113,863,330
|
|
|
|
|
|
|
Effective on the Acquisition Date, the Company entered into an agreement with the former CEO of Greater Media
to provide consulting services for a period of one year. The costs associated with this agreement are reported in other operating expenses in the accompanying statement of comprehensive income for the three months ended March 31, 2017.
The following unaudited pro forma information for the three months ended March 31, 2016 assumes that the merger had occurred on
January 1, 2016. The significant pro forma adjustments are depreciation and interest expense. This unaudited pro forma information has been prepared based on estimates and assumptions, which management believes are reasonable, and is not
necessarily indicative of what would have occurred had the acquisition been completed on January 1, 2016 or of results that may occur in the future.
|
|
|
|
|
Net revenue
|
|
$
|
56,971,325
|
|
Operating income
|
|
|
5,681,060
|
|
Net income
|
|
|
521,634
|
|
Basic and diluted net income per share
|
|
|
0.02
|
|
Dispositions
On January 6, 2017, the Company completed the sale of substantially all of the assets used or useful in the operations of
WBT-AM,
WBT-FM,
WFNZ-AM
and
WLNK-FM
in Charlotte, NC to Entercom Communications Corp. for
$24.0 million in cash. On November 1, 2016, the assets of
WBT-AM,
WBT-FM
and
WLNK-FM
were contributed to a trust
following completion of the Companys acquisition of Greater Media and were operated by Entercom under a local marketing agreement until completion of the sale. The assets of
WBT-AM,
WBT-FM
and
WLNK-FM
were reported as a beneficial interest in trust as of December 31, 2016 that was realized upon completion of the sale. The Company repaid a portion of
the outstanding balance under its credit facility with the sales proceeds. The Company recorded a $0.3 million loss on disposition during the first quarter of 2017.
On May 1, 2017, the Company completed the sale of substantially all of the assets used in the operations of
WIKS-FM,
WMGV-FM,
WNCT-AM,
WNCT-FM,
WSFL-FM
and
WXNR-FM
in its
Greenville-New
Bern-Jacksonville, NC market cluster to CMG Coastal Carolina, LLC for $11.0 million in cash. The Company repaid a portion of the outstanding
balance under its credit facility with the sales proceeds. The Company no longer has operations in the
Greenville-New
Bern-Jacksonville, NC market after completion of the disposition. However management
determined that the disposition did not represent a strategic shift that will have a major effect on the Companys operations and financial results, therefore the operations in the
Greenville-New
Bern-Jacksonville, NC market were not reported as discontinued operations.
Pre-tax
income (loss) for the radio stations in the
Greenville-New
Bern-Jacksonville, NC
market was $(0.2) million and $0.1 million for the three months ended March 31, 2016 and 2017, respectively. The assets of
WIKS-FM,
WMGV-FM,
WNCT-AM,
WNCT-FM,
WSFL-FM
and
WXNR-FM
have been classified as held for sale as of
December 31, 2016 and March 31, 2017.
A summary of assets held for sale is as follows:
|
|
|
|
|
|
|
|
|
|
|
December 31,
2016
|
|
|
March 31,
2017
|
|
Property and equipment, net
|
|
$
|
1,400,615
|
|
|
$
|
1,400,615
|
|
FCC broadcasting licenses
|
|
|
3,998,940
|
|
|
|
3,998,940
|
|
Goodwill
|
|
|
1,943,349
|
|
|
|
1,943,349
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
7,342,904
|
|
|
$
|
7,342,904
|
|
|
|
|
|
|
|
|
|
|
9
BEASLEY BROADCAST GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(4) Long-Term Debt
Long-term debt is comprised of the following:
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
|
March 31,
|
|
|
|
2016
|
|
|
2017
|
|
Term loan
|
|
$
|
265,000,000
|
|
|
$
|
237,000,000
|
|
Revolving credit facility
|
|
|
3,000,000
|
|
|
|
3,000,000
|
|
Capital lease obligations
|
|
|
691,951
|
|
|
|
676,681
|
|
|
|
|
|
|
|
|
|
|
|
|
|
268,691,951
|
|
|
|
240,676,681
|
|
Less unamortized debt issuance costs
|
|
|
(14,313,703
|
)
|
|
|
(13,766,895
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
254,378,248
|
|
|
|
226,909,786
|
|
Less current installments
|
|
|
(6,686,077
|
)
|
|
|
(61,812
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
247,692,171
|
|
|
$
|
226,847,974
|
|
|
|
|
|
|
|
|
|
|
As of March 31, 2017, the credit facility consisted of a term loan with a remaining balance of
$237.0 million and a revolving credit facility with an outstanding balance of $3.0 million and a maximum commitment of $20.0 million. As of March 31, 2017, the Company had $17.0 million in available commitments under its
revolving credit facility. At the Companys option, the credit facility may bear interest at either (i) the London Interbank Offered Rate (LIBOR) plus a margin 6.0% or (ii) the base rate plus a margin of 5.0%. Each margin
will decrease 0.25% when the Companys First Lien Leverage Ratio (as defined in the credit agreement) is equal or less than 3.75x. The LIBOR interest rate for the term loan is subject to a 1% floor. Interest payments for loans based on LIBOR
are due at the end of each applicable interest period unless the interest period is longer than three months, then they are due at the end of each three month period. Interest payments for loans based on the base rate are due quarterly. The
revolving credit facility carried interest, based on LIBOR, at 7.0% as of March 31, 2017 and matures on November 1, 2021. The term loan carried interest, based on LIBOR, at 7.0% as of March 31, 2017 and matures on November 1,
2023.
As of December 31, 2016, the credit facility consisted of a term loan with a remaining balance of $265.0 million and a
revolving credit facility with an outstanding balance of $3.0 million and a maximum commitment of $20.0 million. The revolving credit facility carried interest, based on LIBOR, at 6.8% as of December 31, 2016. The term loan carried
interest, based on LIBOR, at 7.0% as of December 31, 2016.
Commencing with the year ending December 31, 2017, the credit
agreement requires mandatory prepayments equal to 75% of Excess Cash Flow (as defined in the credit agreement) when the Companys Total Leverage Ratio (as defined in the credit agreement) is greater than 3.75x; mandatory prepayments equal to
50% of Excess Cash Flow when the Companys Total Leverage Ratio is less than or equal to 3.75x and greater than 3.5x; mandatory prepayments equal to 25% of Excess Cash Flow when the Companys Total Leverage Ratio is less than or equal to
3.5x and greater than 3.0x; and no mandatory prepayments when the Companys Total Leverage Ratio is less than or equal to 3.0x. Mandatory prepayments of consolidated Excess Cash Flow are due 105 days after year end. The credit agreement also
requires mandatory prepayments for defined amounts from net proceeds of asset sales, net insurance proceeds, and net proceeds of debt issuances.
The credit agreement requires the Company to comply with certain financial covenants which are defined in the credit agreement. These
financial covenants include a First Lien Leverage Ratio that will be tested at the end of each quarter. For the period from March 31, 2017 through March 31, 2018, the maximum First Lien Leverage Ratio is 6.25x. For the period from
June 30, 2018 through September 30, 2018, the maximum First Lien Leverage Ratio is 6.0x. For the period from December 31, 2018 through September 30, 2019, the maximum First Lien Leverage Ratio is 5.75x. The maximum First Lien
Leverage Ratio is 5.25x for December 31, 2019 and thereafter.
The credit facility is secured by substantially all assets of the
Company and its subsidiaries and is guaranteed jointly and severally by the Company and its subsidiaries. If the Company defaults under the terms of the credit agreement, the Company and its subsidiaries may be required to perform under their
guarantees. As of March 31, 2017, the maximum amount of undiscounted payments the Company and its applicable subsidiaries would have been required to make in the event of default was $240.0 million. The revolving credit facility and the
guarantees related thereto expire on November 1, 2021 and the term loan credit agreement and the guarantees related thereto expire on November 1, 2023.
Failure to comply with financial covenants, scheduled interest payments, scheduled principal repayments, or any other terms of our credit
agreement could result in the acceleration of the maturity of our outstanding debt, which could have a material adverse effect on our business or results of operations. As of March 31, 2017, the Company was in compliance with all applicable
financial covenants under its credit agreement.
10
BEASLEY BROADCAST GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The aggregate scheduled principal repayments of the credit facility and capital lease
obligations for the remainder of 2017, the next four years and thereafter are as follows:
|
|
|
|
|
2017
|
|
$
|
45,807
|
|
2018
|
|
|
64,020
|
|
2019
|
|
|
67,101
|
|
2020
|
|
|
11,820,326
|
|
2021
|
|
|
13,323,700
|
|
Thereafter
|
|
|
215,355,727
|
|
|
|
|
|
|
Total
|
|
$
|
240,676,681
|
|
|
|
|
|
|
(5) Stock-Based Compensation
The Beasley Broadcast Group, Inc. 2007 Equity Incentive Award Plan (the 2007 Plan) permits the Company to issue up to
4.0 million shares of Class A common stock. The 2007 Plan allows for eligible employees, directors and certain consultants of the Company to receive shares of restricted stock, stock options or other stock-based awards. The restricted
stock awards that have been granted under the 2007 Plan generally vest over one to five years of service.
A summary of restricted stock
activity under the 2007 Plan for the three months ended March 31, 2017 is as follows:
|
|
|
|
|
|
|
|
|
|
|
Shares
|
|
|
Weighted-
Average
Grant-Date
Fair
Value
|
|
Unvested as of January 1, 2017
|
|
|
343,513
|
|
|
$
|
4.70
|
|
Granted
|
|
|
45,792
|
|
|
|
9.05
|
|
Vested
|
|
|
(115,911
|
)
|
|
|
3.78
|
|
Forfeited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unvested as of March 31, 2017
|
|
|
273,394
|
|
|
$
|
4.76
|
|
|
|
|
|
|
|
|
|
|
As of March 31, 2017, there was $1.3 million of total unrecognized compensation cost related to
restricted stock granted under the 2007 Plan. That cost is expected to be recognized over a weighted-average period of 2.8 years.
(6) Income Taxes
The Companys effective tax rate was approximately 41% and (5.9)% for the three months ended March 31, 2016 and 2017, respectively.
These rates differ from the federal statutory rate of 35% due to the effect of state income taxes and certain expenses that are not deductible for tax purposes. The effective tax rate for the three months ended March 31, 2017 also reflects a
$3.0 million decrease due to the change in fair value of contingent consideration.
(7) Related Party Transactions
On February 22, 2017, the Company contributed $150,000 to LN2 DB, LLC (formerly Digital PowerRadio, LLC) in exchange for a note bearing
interest at 18% per annum. Principal and accrued interest are due on the maturity date of December 31, 2019. LN2 DB, LLC is managed by Fowler Radio Group, LLC which is partially-owned by Mark S. Fowler, an independent director of Beasley
Broadcast Group, Inc.
(8) Financial Instruments
The carrying amount of the Companys financial instruments including cash and cash equivalents, accounts receivable and accounts payable
approximate fair value due to the short term nature of these financial instruments.
The carrying amount of the Companys term loan
as of March 31, 2017 was $237.0 million. The Company estimated the fair value of the term loan to be $237.2 million using observable inputs (Level 2). The carrying amount of the Companys revolving credit
11
BEASLEY BROADCAST GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
facility and capital lease obligations as of March 31, 2017 was $3.7 million which approximated fair value based on current market interest rates. The carrying amount of the
Companys term loan as of December 31, 2016 was $265.0 million. The Company estimated the fair value of the term loan to be $268.5 million using observable inputs (Level 2). The carrying amount of the Companys revolving
credit facility and capital lease obligations as of December 31, 2016 was $3.7 million which approximated fair value based on current market interest rates.
12