e424b3
Filed Pursuant to Rule 424(b)(3)
Registration No 333-127166
PROSPECTUS
RADIO ONE, INC.
1,809,648 Shares
Class D Common Stock
This prospectus relates to resales by selling stockholders of shares of Class D common
stock of Radio One, Inc. We will not receive any proceeds from this offering. The selling
stockholders, security holders of Reach Media, Inc., acquired their shares of our common stock in
connection with our acquisition of 51% of the common stock of Reach Media, Inc.
Our Class D common stock is traded on the Nasdaq Stock Market under the symbol ROIAK. On
August 15, 2005, the last reported sale price of our Class D common stock on the Nasdaq Stock
Market was $13.91 per share.
We will not be paying any underwriting discounts or commissions in connection with this
offering.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS
APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. SEE THE SECTION ENTITLED RISK
FACTORS ON PAGE 4 OF THIS PROSPECTUS.
The date of this prospectus is August 16, 2005.
TABLE OF CONTENTS
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Incorporation
of Documents By Reference
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Cautionary Note Regarding Forward-Looking Statements
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Summary
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Risk Factors
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Use of Proceeds
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Selling Stockholders
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Plan of Distribution
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Legal Matters
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Independent Registered Public Accounting Firm
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Where You Can Find Additional Information
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This prospectus is part of a registration statement we filed with the Securities and Exchange
Commission. You should rely only on the information we have provided or incorporated by reference
in this prospectus or any prospectus supplement. We have not authorized anyone to provide you with
additional or different information. No dealer, salesperson or other person is authorized to give
any information or to represent anything not contained in this prospectus. You must not rely on
any unauthorized information or representation. This prospectus is an offer to sell only the
securities offered hereby, but only under circumstances and in jurisdictions where it is lawful to
do so. You should assume that the information in this prospectus or any prospectus supplement is
accurate only as of the date on the front of the document and that any information we have
incorporated by reference is accurate only as of the date of the document incorporated by
reference, regardless of the time of delivery of this prospectus or any sale of a security.
Unless otherwise mentioned or unless the context requires otherwise, all references in this
prospectus to Radio One, we, our or similar references mean Radio One, Inc. together with its
subsidiaries.
INCORPORATION OF DOCUMENTS BY REFERENCE
Important business and financial information about Radio One, Inc. is incorporated by
reference into this prospectus. This means that we are disclosing important information to you by
referring you to certain documents we have filed with the SEC rather than including the information
in this prospectus. The information in the documents incorporated by reference is considered to be
part of this prospectus. We incorporate by reference the documents listed below and any future
filings we may make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, as amended (the Exchange Act) prior to the completion of
this offering:
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our annual report on Form 10-K/A for the fiscal year ended December 31, 2004; |
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our quarterly reports on Form 10-Q for the quarters ended
March 31, 2005 and June 30, 2005; and |
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our current reports on Form 8-K dated June 9, 2005
and June 17, 2005. |
Information contained in this prospectus supplements, modifies or supersedes, as applicable,
the information contained in earlier-dated documents incorporated by reference. Information in
documents that we file with the SEC after the date of this prospectus will automatically update and
supersede information in this prospectus or in earlier-dated documents incorporated by reference.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains statements about future events and expectations, or forward-looking
statements. We have based these forward-looking statements on our current expectations and
projections about future results. When we use words in this document such as anticipates,
intends, plans, believes, estimates, expects, targets, projects and similar
expressions, we do so to identify forward-looking statements. We cannot guarantee that we will
achieve these plans, intentions or expectations. These statements are based on our managements
beliefs and assumptions, which in turn are based on currently available information. These
assumptions could prove inaccurate. See Risk Factors.
You should keep in mind that any forward-looking statement made by us in this prospectus or
elsewhere speaks only as of the date on which we make it. New risks and uncertainties come up from
time to time, and it is impossible for us to predict these events or how they may affect us. In any
event, these and other important factors may cause actual results to differ materially from those
indicated by our forward-looking statements. We have no duty to, and do not intend to, update or
revise the forward-looking statements in this prospectus after the date of this prospectus, except
as may be required by law. In light of these risks and uncertainties, you should keep in mind that
any forward-looking statement made in this prospectus or elsewhere might not occur.
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SUMMARY
This summary highlights certain information concerning our business. You should carefully
read the entire prospectus and should consider, among other things, the matters set forth in Risk
Factors before deciding whether to purchase an of the shares being offered under this prospectus.
When used in this prospectus, the terms Radio One, we, our, and us refer to Radio One, Inc.
and its consolidated subsidiaries, unless otherwise specified.
Radio One, Inc.
We are one of the largest radio broadcasting companies in the United States and the leading
radio broadcasting company primarily targeting African-Americans. Founded in 1980, we own and/or
operate 69 radio stations in 22 markets. Of these stations, 39 (29 FM and 10 AM) are in 14 of the
top 20 African-American markets.
We are led by our Chairperson and co-founder, Catherine L. Hughes, and her son, Alfred C.
Liggins, III, our Chief Executive Officer and President, who together have approximately 50 years
of operating experience in radio broadcasting. Ms. Hughes, Mr. Liggins and our strong management
team have successfully implemented a strategy of acquiring and turning around underperforming radio
stations. Our strategy for our radio broadcasting business is to continue to expand within our
existing markets and into new markets that have a significant African-American presence. We will
achieve this strategy through acquisitions of new radio stations and organic growth of our existing
radio stations. We believe radio broadcasting primarily targeting African-Americans continues to
have significant growth potential and that we have a competitive advantage in the African-American
market and the radio industry in general, due to our focus on urban formats, our skill in
programming and marketing these formats, and our turnaround expertise.
We believe that our experience in the African-American market and our substantial radio
listener base provides us with a competitive advantage in other complementary media businesses,
such as cable television networks, programming content development and Internet-based services.
Together with an affiliate of Comcast Corporation, we launched TV One, an African-American targeted
cable television network, in January 2004. We also currently program one channel on XM Satellite
Radio. In February 2005, we completed the acquisition of 51% of the common stock of Reach Media,
Inc. (Reach Media). Reach Media commenced operations in 2003 and was formed by Tom Joyner, its
Chairman, and David Kantor, its Chief Executive Officer, to operate the Tom Joyner Morning Show and
related businesses. Mr. Joyner is a leading, nationally-syndicated radio personality.
Recent Developments
Stock Repurchase Program
On June 6, 2005, we announced that our board of directors had authorized a stock repurchase
program for up to $150.0 million of our Class A and Class D common stock over an 18-month period,
with the amount and timing of repurchases based on stock price, general economic and market
conditions, certain restrictions contained in agreements governing our bank credit facilities and
subordinated debt and certain other factors.
New Credit Facility
In June 2005, we entered into a new credit facility (the "Credit Agreement") with a syndicate of banks.
The term of the Credit Agreement is seven years and the total amount available under the Credit Agreement is $800.0 million, consisting of a $500.0 million revolving facility and a $300.0 million term loan facility.
Borrowings under the bank credit facilities are subject to compliance with provisions of the Credit Agreement, including but not
limited to financial covenants. We may use the proceeds from the bank credit facilities for working capital, capital expenditures made
in the ordinary course of business and other lawful corporate purposes, for our common stock repurchases, and for direct and indirect investments permitted under the Credit Agreement. Simultaneous with entering into the new credit facility, we borrowed
$437.5 million under the new facility to retire all outstanding obligations under our previous
credit facility.
Radio One, Inc. is a Delaware corporation. The principal executive offices of Radio One are
located at: Radio One, Inc., 5900 Princess Garden Parkway, 7th Floor, Lanham, Maryland 20706. The
phone number is (301) 306-1111.
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RISK FACTORS
You should carefully consider the risks described below in addition to the other information
contained in this prospectus and the documents incorporated by reference into this prospectus
before deciding whether to purchase any shares being offered under this prospectus. You should also
carefully consider the information set forth in our annual report on Form 10-K/A for the fiscal
year ended December 31, 2004 under the heading Risk Factors.
Risks Related to Our Business
Our future operating results could be adversely affected by a number of risks and
uncertainties, certain of which are described below. The risks and uncertainties described below
are not the only risks we face. Additional risks and uncertainties not currently known to us or
that we currently deem immaterial may impair our business operations. If any of the risks described
below actually occur, our business, results of operations and financial condition could be
materially and adversely affected.
Decreased spending by advertisers can adversely affect our revenue and operating results.
Substantially all of our revenue is derived from sales of advertisements and program
sponsorships on our stations to local and national advertisers. Generally, advertising tends to
decline during economic recession or downturn. As a result, our advertising revenue is likely to be
adversely affected by a recession or downturn in the United States economy, the economy of an
individual geographic market in which we own or operate radio stations, or other events or
circumstances that adversely affect advertising activity.
We may lose audience share and advertising revenue to competing radio stations or other types of
media competitors.
We operate in a highly competitive industry. Our radio stations compete for audiences and
advertising revenue with other radio stations and station groups, as well as with other media such
as broadcast television, newspapers, magazines, cable television, satellite television, satellite
radio, outdoor advertising, the Internet and direct mail. Audience ratings and market shares are
subject to change. Any adverse change in a particular market, or adverse change in the relative
market positions of the stations located in a particular market could have a material adverse
effect on our revenue or ratings, could require increased promotion or other expenses in that
market, and could adversely affect our revenue in other markets. Other radio broadcasting companies
may enter the markets in which we operate or may operate in the future. These companies may be
larger and have more financial resources than we have. Our radio stations may not be able to
maintain or increase their current audience ratings and advertising revenue. In addition, from time
to time, other stations may change their format or programming, a new station may adopt a format to
compete directly with our stations for audiences and advertisers, or stations might engage in
aggressive promotional campaigns. These tactics could result in lower ratings and advertising
revenue or increased promotion and other expenses and, consequently, lower earnings and cash flow
for us. Audience preferences as to format or programming may also shift due to demographic or other
reasons. Any failure by us to respond, or to respond as quickly as our competitors, could have an
adverse effect on our business and financial performance. We cannot assure you that we will be able
to maintain or increase our current audience ratings and advertising revenue.
We must respond to the rapid changes in technology, services and standards which characterize our
industry in order to remain competitive.
The radio broadcasting industry is subject to rapid technological change, evolving industry
standards and the emergence of new media technologies, which may impact our business. We cannot
assure you that we will have the resources to acquire new technologies or to introduce new services
that could compete with these new technologies. Several new media technologies are being, or have
been, developed, including the following:
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satellite delivered digital audio radio service, which has resulted in the
introduction of several new satellite radio services with sound quality equivalent to
that of compact discs; |
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audio programming by cable television systems, direct broadcast satellite
systems, Internet content providers and other digital audio broadcast formats; and |
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digital audio and video content available for listening and/or viewing on the
Internet and/or available to be downloaded to portable devices. |
We cannot assure you that we will be able to adapt effectively to these new media
technologies.
The loss of key personnel, including on-air talent, could disrupt the management and operations of
our business.
Our business depends upon the continued efforts, abilities and expertise of our executive
officers, including our chief executive officer, chief financial officer, chief operating officer
and chief administrative officer, and other key employees, including on-air personalities. We
believe that the unique combination of skills and experience possessed by our executive officers
could be difficult to replace, and that the loss of any one of them could have a material adverse
effect on us, including the impairment of our ability to execute our business strategy.
Additionally, we employ or independently contract with several on-air personalities and hosts of
syndicated radio programs with significant loyal audiences in their respective broadcast areas.
These on-air personalities are sometimes significantly responsible for the ranking of a station,
and thus, the ability of the station to sell advertising. We cannot be assured that these
individuals will remain with us or will retain their current audiences.
Our acquisition strategy could be hampered by a lack of attractive opportunities or other risks
associated with integrating the operations, systems and management of the radio stations we
acquire.
Our acquisition strategy depends significantly on our ability to identify underperforming
radio stations or stick stations in attractive markets, to purchase such stations at a reasonable
cost and to increase revenue, cash flow and ratings from such radio stations. Some of the material
risks that could hinder our ability to implement this strategy include:
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increases in prices for radio stations due to increased competition for acquisition opportunities; |
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reduction in the number of suitable acquisition targets; |
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failure or unanticipated delays in completing acquisitions due to difficulties
in obtaining required regulatory approval, including possible difficulties in obtaining
antitrust approval for acquisitions in markets where we already own multiple stations or
potential delays resulting from the uncertainty arising from legal challenges to the
FCCs adoption of new broadcast ownership rules; |
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difficulty in integrating operations and systems and managing a large and
geographically diverse group of radio stations; |
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failure of some acquisitions to prove profitable or generate sufficient cash flow; |
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issuance of large amounts of common stock in order to purchase radio stations; |
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need to finance acquisitions through funding from the credit or capital markets; and |
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inability to finance acquisitions on acceptable terms. |
Our business depends on maintaining our licenses with the FCC. We could be prevented from operating
a radio station if we fail to maintain its license.
Radio broadcasters depend upon maintaining radio broadcasting licenses issued by the FCC.
These licenses are ordinarily issued for a maximum term of eight years and are renewable. Our radio
broadcasting licenses expire at various times through October 1, 2012. Although we may apply to
renew our FCC licenses, interested third parties may challenge our renewal applications. In
addition, we are subject to extensive and changing regulation by the FCC
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with respect to such matters as programming, indecency standards, technical operations,
employment and business practices. If we or any of our significant stockholders, officers, or
directors violate the FCCs rules and regulations or the Communications Act of 1934, or is
convicted of a felony, the FCC may commence a proceeding to impose fines or sanctions upon us.
Examples of possible sanctions include the imposition of fines, the renewal of one or more of our
broadcasting licenses for a term of fewer than eight years or the revocation of our broadcast
licenses. If the FCC were to issue an order denying a license renewal application or revoking a
license, we would be required to cease operating the radio station covered by the license only
after we had exhausted administrative and judicial review without success.
There is significant uncertainty regarding the FCCs media ownership rules, and such rules could
restrict our ability to acquire radio stations.
The radio broadcasting industry is subject to extensive and changing federal regulation. Among
other things, the Communications Act and FCC rules and policies limit the number of broadcasting
properties that any person or entity may own (directly or by attribution) in any market and require
FCC approval for transfers of control and assignments of licenses.
In June 2003, the FCC issued a media ownership decision which substantially altered its
television, radio and cross-media ownership restrictions (the 2003 rules). The FCCs media
ownership restrictions apply to parties that hold attributable interests in broadcast station
licensees. With respect to radio, the 2003 rules, among other things, (a) retained the pre-existing
numerical limits on the permissible number of radio stations in FCC-defined local radio markets in
which a party may co-own or have an attributable interest; (b) redefined local radio markets to
rely on Arbitron Metro Survey Areas (Arbitron Metros) (in portions of the country where they exist)
in place of the contour-overlap methodology previously used; (c) grandfathered existing local radio
combinations that conflict with the 2003 rules based on the Arbitron Metro definition of local
radio markets until the combination is sold; (d) provided that a contract to sell more than 15% per
week of the advertising time on another in-market radio station (Joint Sales Agreement or JSA)
constitutes an attributable interest; and (e) replaced radio-TV and daily newspaper-broadcast
cross-ownership rules with a more relaxed single set of new cross-media ownership restrictions. In
addition, the FCC instituted a rulemaking to determine how to define local radio markets in areas
outside Arbitron Metros.
The 2003 rules were challenged in court. The challenges were consolidated before the U.S.
Court of Appeals for the Third Circuit, which initially issued a stay of the 2003 rules before they
became effective and subsequently remanded many of them to the FCC for further proceedings, keeping
the judicial stay in place and retaining jurisdiction. As a result, the FCC continued to apply the
rules in effect before the stay. The FCC also filed a petition to partially lift the judicial stay
as it relates to the new local radio ownership restrictions. The Third Circuit lifted the stay as
it relates to the FCCs decision to (i) make JSAs an attributable interest, (ii) define local radio
markets based on Arbitron Metros, and (iii) grandfather certain local radio combinations only until
the combination is sold. The court declined to lift the stay as to matters pertaining to numerical
limits on local radio ownership and the AM subcap. In response, the FCC revised its application
forms for transfers of control and assignments of licenses to incorporate these aspects of the 2003
rules, and the FCC is now applying such revisions to all pending and new applications.
The FCCs media ownership rules remain in flux and subject to further agency and court
proceedings. Certain of the parties to the Third Circuits decision requested review by the U.S.
Supreme Court, which request was denied. At the FCC, the 2003 rules are currently on remand from
the Third Circuit and the FCC has not yet instituted further proceedings. Also, the FCC has not yet
ruled on pending petitions for reconsideration of the decision adopting the 2003 rules.
In addition to the FCC media ownership rules, the outside media interests of our officers and
directors could limit our ability to acquire stations. The filing of petitions or complaints
against Radio One or any FCC licensee from which we are acquiring a station could result in the FCC
delaying the grant of, or refusing to grant or imposing conditions on its consent to the assignment
or transfer of control of licenses. The Communications Act and FCC rules and policies also impose
limitations on non-U.S. ownership and voting of our capital stock.
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Increased enforcement by FCC of its indecency rules against the broadcast industry.
The FCC has recently indicated that it is enhancing its enforcement efforts relating to the
regulation of indecency and has threatened to initiate license revocation proceedings against a
broadcast licensee who commits a serious indecency violation. Legislation that passed in the
House and will be offered in the Senate would dramatically increase the penalties for broadcasting
indecent programming and potentially subject broadcasters to license revocation, renewal or
qualification proceedings in the event that they broadcast indecent material. In addition, the
FCCs heightened focus on the indecency regulatory scheme, against the broadcast industry
generally, may encourage third parties to oppose our license renewal applications or applications
for consent to acquire broadcast stations.
Two common stockholders have a majority voting interest in Radio One and have the power to control
matters on which our common stockholders may vote, and their interests may conflict with yours.
As
of June 30, 2005, our Chairperson and her son, our President and Chief Executive Officer
(CEO), collectively held approximately 56.6% of the outstanding voting power of our common stock.
As a result, our Chairperson and the CEO will control most decisions involving us, including
transactions involving a change of control, such as a sale or merger. In addition, certain
covenants in our debt instruments require that our Chairperson and the CEO maintain a specified
ownership and voting interest in us, and prohibit other parties voting interests from exceeding
specified amounts. In addition, the TV One operating agreement provides for adverse consequences to
Radio One in the event our Chairperson and CEO fail to maintain a specified ownership and voting
interest in us. Our Chairperson and the CEO have agreed to vote their shares together in elections
of members of the board of directors.
Our substantial level of debt could limit our ability to grow and compete.
As
of June 30, 2005, we had indebtedness of $937.5 million.
Borrowings under our bank credit facilities are
subject to compliance with provisions of our Credit Agreement, including but not limited to the
financial covenants. Currently, we are permitted to borrow up to an
additional $143.0 million
under our bank credit facility, taking into consideration the covenants under the Credit Agreement. See SummaryRecent DevelopmentsNew Credit Facility. We may
reborrow under our revolving credit facility as needed to fund our working capital needs, for
general corporate purposes and to fund permitted acquisitions and investments. A portion of our
indebtedness bears interest at variable rates. Our substantial level of indebtedness could
adversely affect us for various reasons, including limiting our ability to:
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obtain additional financing for working capital, capital expenditures,
acquisitions, debt payments or other corporate purposes; |
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have sufficient funds available for operations, future business opportunities or other purposes; |
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compete with competitors that have less debt than we do; and |
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react to changing market conditions, changes in our industry and economic downturns. |
Risks Related to Our Common Stock
Future sales of our common stock may depress our stock price.
If our stockholders sell substantial amounts of our common stock (including shares issued upon
the exercise of options and warrants) in the public market, the market price of our common stock
could fall. These sales also might make it more difficult for us to sell equity or equity-related
securities in the future at a time and price that we deem appropriate. For example, following an
acquisition, a significant number of shares of our common stock held by new stockholders may become
freely tradable or holders of registration rights could cause us to register their shares for
resale. Sales of these shares of common stock held by existing stockholders could cause the market
price of our common stock to decline.
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USE OF PROCEEDS
The proceeds from the sale of the common stock offered pursuant to this prospectus are solely
for the account of the selling stockholders. We will not receive any proceeds from the sale of
these shares of common stock.
SELLING STOCKHOLDERS
We are registering the shares of common stock covered by this prospectus on behalf of the
selling stockholders named in the table below. We issued the shares to the selling stockholders in
a private placement transaction in connection with our acquisition of 51% of the common stock of
Reach Media, Inc. We agreed to register the shares to permit the selling stockholders and their
pledgees, donees, transferees or other successors-in-interest that receive their shares from a
selling stockholder as a gift, partnership distribution or other non-sale related transfer after
the date of this prospectus, to resell the shares.
The
following table sets forth certain information provided to us by the selling stockholders,
including the name of each selling stockholder, the number of shares of our common stock
beneficially owned by each selling stockholder as of August 16, 2005, the number of shares that may
be offered under this prospectus and the number of shares of our common stock beneficially owned by
each selling stockholder after this offering is completed. Except as set forth in the table below,
none of the selling stockholders has had a material relationship with us within the past three
years. The number of shares in the column Number of Shares Being Offered represents all of the
shares that each selling stockholder may offer under this prospectus. The selling stockholders may
sell some, all or none of their shares.
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Number of Shares |
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Number of Shares |
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Beneficially |
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Number of |
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Owned Prior to |
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Shares Being |
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Offering |
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Offered |
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Offering(1) |
Thomas E. Joyner(2)
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725,274 |
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725,274 |
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Thomas Elliot Joyner 2004 Retained
Annuity Trust u/a/d November 10,
2004(3)
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710,911 |
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710,911 |
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David M. Kantor(2)
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3,473 |
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3,473 |
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Rosemarc Partners Ltd(4)
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343,840 |
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343,840 |
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Julia Atherton(5)
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13,075 |
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13,075 |
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Royce B. West(6)
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13,075 |
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13,075 |
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Assumes the sale of all shares being offered.
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Mr. Joyner and Mr. Kantor are employees and directors of Reach Media, Inc. |
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Thomas Elliot Joyner 2004 Retained Annuity Trust u/a/d November 10, 2004 is a trust
established by Mr. Joyner the beneficiaries of which are Oscar Joyner and Thomas Joyner, Jr. |
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Rosemarc Partners Ltd is a Texas partnership under the control of Mr. Kantor.
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Ms. Atherton is an employee of Reach Media, Inc. |
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Mr. West was a director of Reach Media prior to the Reach Acquisition by Radio One. |
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PLAN OF DISTRIBUTION
The selling stockholders may sell the shares from time to time. The selling stockholders will
act independently of us in making decisions regarding the timing, manner and size of each sale.
The sales may be made on the Nasdaq Stock Market, on one or more exchanges or in the
over-the-counter market or otherwise, at prices and at terms then prevailing or at prices related
to the then current market price, or in privately negotiated transactions. The selling
stockholders may effect these transactions by selling the shares to or through broker-dealers. The
selling stockholders may also sell their shares in one or more of, or a combination of:
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ordinary brokerage transactions and transactions in which the broker solicits
purchasers; |
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a block trade in which the broker-dealer will attempt to sell the shares as
agent but may position and resell a portion of the block as principal to facilitate the
transaction; |
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a purchase by a broker-dealer as principal and resale by a broker-dealer for its
account under this prospectus; and |
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an exchange distribution in accordance with the rules of an exchange. |
To the extent required, this prospectus may be amended or supplemented from time to time to
describe a specific plan of distribution. If the plan of distribution involves an arrangement with
a broker-dealer for the sale of shares through a block trade, special offering, exchange
distribution or secondary distribution or a purchase by a broker or dealer, the amendment or
supplement will disclose:
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the name of each selling stockholder and of the participating broker-dealer(s); |
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the number of shares involved; |
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the price at which the shares were sold; |
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the commissions paid or discounts or concessions allowed to the
broker-dealer(s), where applicable; |
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that a broker-dealer(s) did not conduct any investigation to verify the
information set out or incorporated by reference in this prospectus; and |
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other facts material to the transaction. |
The selling stockholders may enter into option or other transactions with broker-dealers which
require the delivery to the brokerdealer of the shares. The broker-dealer may then resell or
otherwise transfer the shares under this prospectus. The selling stockholders also may loan or
pledge the shares to a broker-dealer. The broker-dealer may sell the loaned shares, or upon a
default the brokerdealer may sell the pledged shares under this prospectus.
In effecting sales, broker-dealers engaged by the selling stockholders may arrange for other
broker-dealers to participate in the resales. Broker-dealers or agents may receive compensation in
the form of commissions, discounts or concessions from selling stockholders. Broker-dealers or
agents may also receive compensation from the purchasers of the shares for whom they act as agents
or to whom they sell as principals, or both. Compensation as to a particular broker-dealer might
be in excess of customary commissions and will be in amounts to be negotiated in connection with
the sale. Broker-dealers or agents and any other participating broker-dealers or the selling
stockholders may be deemed to be underwriters within the meaning of Section 2(11) of the
Securities Act of 1933, as amended, in connection with sales of the shares. Accordingly, any
commission, discount or concession received by them and any profit on the resale of the shares
purchased by them may be deemed to be underwriting discounts or commissions under the Securities
Act. Because selling stockholders may be deemed to be underwriters within the meaning of Section
2(11) of the Securities Act, the selling stockholders will be subject to the prospectus delivery
requirements of the Securities Act. In addition, any securities covered by this prospectus
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that qualify for sale under Rule 144 promulgated under the Securities Act may be sold under
Rule 144 rather than under this prospectus. The selling stockholders have advised that they have
not entered into any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their securities. There is no underwriter or coordinating
broker acting in connection with the proposed sale of shares by the selling stockholders.
The shares will be sold only through registered or licensed brokers or dealers if required
under applicable state securities laws. In addition, in some states the shares may not be sold
unless they have been registered or qualified for sale in the applicable state or an exemption from
the registration or qualification requirement is available and is complied with.
In the event of a distribution of the shares, the selling stockholders, any selling broker or
dealer and any affiliated purchasers may be subject to Regulation M under the Exchange Act, which
would generally prohibit these persons from bidding for or purchasing any security that is the
subject of the distribution until his or her participation in that distribution is completed. In
addition, Regulation M also prohibits any bid or purchase for the purpose of pegging, fixing or
stabilizing the price of our common stock in connection with this offering.
Registration Rights Agreement
The following description is a summary of the material provisions of the registration rights
agreement between Radio One and the selling stockholders. It does not restate that agreement in
its entirety. We urge you to read the registration rights agreement in its entirety because it,
and not this description, defines the restrictions placed upon the shares being offered by the
Selling Shareholders.
The selling stockholders have agreed to restrictions regarding the sale of the shares of
common stock being offered pursuant to this prospectus. Until February 28, 2006, none of the
shares subject to these restrictions may be sold or transferred. Commencing on February 28, 2006,
all of the 1,809,648 shares may be sold or transferred pursuant to this prospectus. The shares
being offered pursuant to this prospectus are also subject to a sales blackout period of up to
sixty days should we determine that the disclosure of non-public, material information will be
required as a result of this offering. Notwithstanding the foregoing, the selling stockholders may
pledge, hypothecate or otherwise encumber their shares, provided the creditor or holder of the
encumbrance expressly agrees that the shares are pledged subject to the terms and conditions of the
registration rights agreement.
We have agreed to use commercially reasonable efforts to keep the registration statement
effective until the earlier of (i) such time as all of the shares of common stock offered pursuant
to this prospectus have been sold or otherwise disposed of by the selling stockholders and (ii) the
date that is eighteen (18) months after the effective date of the registration statement of which
this prospectus is a part.
The registration rights agreement also provides that the selling stockholders may not:
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1. |
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effect any stabilization transactions or activity in contravention of
Regulation M under the Exchange Act of 1934; |
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2. |
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permit any affiliated purchaser to bid for or purchase any share in
contravention of Regulation M under the Exchange Act of 1934; or |
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3. |
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sell any of the shares being offered under this prospectus without
notifying Radio One fifteen days prior to such sale. |
We will bear all printing, registration and filing fees and our own legal and accounting fees
in connection with the registration of the shares. The selling stockholders will bear their own
legal fees and costs and all commissions, discounts and expenses of underwriters or brokers, if
any, attributable to the sales of the shares. We and the selling stockholders have agreed to
indemnify each other against certain liabilities that could arise from the registration and sale of
the shares.
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LEGAL MATTERS
The validity of the securities being offered hereby will be passed upon by Covington &
Burling, Washington, DC.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The consolidated financial statements of Radio One, Inc. incorporated by reference in Radio
One, Inc.s Annual Report (Form 10-K/A) for the year ended December 31, 2004 including schedules
appearing therein, and Radio One, Inc.s managements assessment of the effectiveness of internal
control over financial reporting as of December 31, 2004 included therein, have been audited by
Ernst & Young LLP, independent registered public accounting firm, as set forth in their reports
thereon, included therein, and incorporated herein by reference. Such consolidated financial
statements and managements assessment are incorporated herein by reference in reliance upon such
reports given on the authority of such firm as experts in accounting and auditing.
WHERE
YOU CAN FIND ADDITIONAL INFORMATION
We are a reporting company and file annual, quarterly and current reports, proxy statements
and other information with the SEC. We have filed with the SEC a registration statement on Form
S-3 under the Securities Act with respect to the securities we are offering under this prospectus.
This prospectus does not contain all of the information set forth in the registration statement and
the exhibits to the registration statement. For further information with respect to us and the
securities we are offering under this prospectus, we refer you to the registration statement and
the exhibits and schedules filed as a part of the registration statement. You may read and copy
the registration statement, as well as our reports, proxy statements and other information, at the
SECs public reference room at Room 1580, 100 F Street, N.E., Washington, DC 20549. You can
request copies of these documents by writing to the SEC and paying a fee for the copying cost.
Please call the SEC at 1-800-SEC-0330 for more information about the operation of the public
reference room. Our SEC filings are also available at the SECs web site at http://www.sec.gov.
In addition, you can read and copy our SEC filings at the office of the National Association of
Securities Dealers, Inc. at 1735 K Street, N.W., Washington, DC 20006.
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