Dial Global Is In BIG Trouble!

DG Will Quit the Nasdaq Exchange;
Unable to File Latest SEC Quarterly Report on Time;
Says Company May Not Survive Financial Problems
Dial Global confirms that it has notified the Nasdaq Stock Market of its intention to voluntarily delist. This comes one year after DG's acquisition of Westwood One. In a statement, the company says, "The decision to voluntarily delist from NASDAQ was taken following a review by the company's Board of Directors, which determined that a delisting would be in the best interests of the company. In reaching this conclusion, the company's Board of Directors considered numerous factors, including, among other things, the compliance costs and obligations that result from the maintenance of the company's listing on NASDAQ, the relatively limited historical volume of trading in the company's common stock, the applicable federal securities laws, and the applicable NASDAQ rules." Dial Global says it "currently anticipates that it will file a Form 25 with the U.S. Securities and Exchange Commission on or about November 26, 2012 to commence the delisting process. It is expected that the delisting will take effect on or about December 6, 2012. The company has not arranged for listing and/or registration of its common stock on another national securities exchange. Following delisting, the company's common stock will no longer trade on NASDAQ under the symbol "DIAL" and it is expected that, if one or more market makers determine to make a market in our common stock, the company's common stock will then instead trade on the OTC Pink Sheets."

DG Misses Deadline for Latest SEC Quarterly Report
In a separate SEC filing, Dial Global says it was unable to file its Quarterly Report on time. The report was due this week. DG explains, "For the last several weeks, the company has been involved in extensive negotiations with its lenders to cure certain noncompliance events under its credit agreements, namely not complying with: its debt leverage and interest coverage covenants measured as of September 30, 2012; its quarterly interest payment obligations on Friday, November 9, 2012; certain reporting obligations (including those which the company has historically satisfied by delivering its Form 10-Q to its lenders, and certain notice obligations. Such negotiations resulted in the execution of second amendments and limited waivers to the company's credit facilities to waive these non-compliance events for a limited period of time. These amendments were executed today and are described in more detail in the company's 10-Q which we anticipate filing with the SEC today."

Dial Global Says Rush Limbaugh Hurt Ability To Stay Afloat
"It's not clear how the conservative talk show host affected Dial Global – the radio programming company that merged last year with Westwood One," writes Deadline.com Executive Editor David Lieberman, noting that Rush Limbaugh is syndicated by Clear Channel. "But Dial says in an SEC filing that advertisers’ response to 'controversial statements by a certain nationally syndicated talk radio personality in March 2012' contributed to financial woes that raise 'substantial doubt about the Company’s ability to continue as a going concern.' The March date coincides with an advertiser boycott of Limbaugh following his attacks on Georgetown University law student Sandra Fluke, who urged Congress to require employer health insurance plans to cover contraception." Lieberman says "Limbaugh appears to be the least of Dial’s problems: Its stock is down nearly 77% today, to about 47 cents, after it said that it may not be able to meet its debt covenants and will voluntarily leave NASDAQ to just trade over the counter." The report notes that DG reported a Q3 net loss of $71.2 million, up from a $5.2 million loss in the year-ago period, on revenues that were up 132.7%. "In addition to the Limbaugh controversy, Dial attributes its losses to late cancellations of ad buys (which it says were due to 'the election and renewed economic uncertainty'), and growing competition from digital ad platforms and major radio companies." Private equity firms Oaktree Capital Management and The Gores Group own about 90% of Dial Global’s stock.