<PAGE>

================================================================================

                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                               -----------------

                                   FORM 10-K

(Mark One)
[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

    For the fiscal year ended December 31, 2001

                                      OR

[_]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
    OF 1934

    For the transition period from ________ to ________

                       Commission file number 000-28395

                      INTEREP NATIONAL RADIO SALES, INC.
            (Exact name of registrant as specified in its charter)
                      New York                 13-1865151
                   (State or other          (I.R.S. Employer
                   jurisdiction of         Identification No.)
                  incorporation or
                    organization)

                100 Park Avenue, New              10017
                   York, New York
                (Address of principal          (Zip Code)
                 executive offices)

                                (212) 916-0700
             (Registrant's telephone number, including area code)

     Securities registered under Section 12(b) of the Exchange Act:  None.
        Securities registered under Section 12(g) of the Exchange Act:

                                        Name of Each Exchange on
                 Title of Each Class        Which Registered
                 -------------------        ----------------
              Class A Common Stock, par  Nasdaq National Market
                value $0.01 per share

    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [_]

    Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]

    As of March 25, 2002, the aggregate market value of the Class A Common
Stock, par value $.01 per share, and Class B Common Stock, par value $.01 per
share, held by non-affiliates of the registrant, based upon the last reported
sale price for the registrant's Class A Common Stock on The Nasdaq Stock
Market, as reported in the Wall Street Journal, was $23,803,690 (this excludes
shares owned beneficially by directors, executive officers, the registrant's
Employee Stock Ownership Plan or the registrant's Stock Growth Plan).

    The number of shares of the registrant's Common Stock outstanding as of the
close of business on March 25, 2002, was 5,060,237 shares of Class A Common
Stock, and 4,164,389 shares of Class B Common Stock.

                      DOCUMENTS INCORPORATED BY REFERENCE

    Certain portions of the registrant's proxy statement to be used in
connection with the 2002 Annual Meeting of Shareholders are incorporated by
reference into Part III of this Annual Report on Form 10-K.

================================================================================

<PAGE>

    Throughout this Annual Report, when we refer to "Interep" or "the Company,"
we refer collectively to Interep National Radio Sales, Inc. and all of our
subsidiaries unless the context indicates otherwise or as otherwise noted.

              IMPORTANT NOTE REGARDING FORWARD LOOKING STATEMENTS

    Some of the statements made in this Annual Report are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements are not statements of historical fact, but instead
represent our belief about future events. In some cases, you can identify
forward-looking statements by terminology such as "may," "will," "should,"
"expects," "plans," "anticipates," "believes," "estimates," "predicts,"
"potential," "continue," or the negative of these terms or other comparable
terminology. These statements are based on many assumptions and involve known
and unknown risks and uncertainties that are inherently uncertain and beyond
our control. These risks and uncertainties may cause our or our industry's
actual results, levels of activity, performance or achievements to be
materially different than any expressed or implied by these forward-looking
statements. Although we believe that the expectations in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. You should review the factors noted in
"Management's Discussion and Analysis of Financial Condition and Results of
Operation -- Certain Factors That May Affect Our Results of Operations" for a
discussion of some of the things that could cause actual results to differ from
those expressed in our forward-looking statements.

                                    PART I

Item 1.  BUSINESS

General

    Interep is the largest independent national spot radio representation or
"rep" firm in the United States. We are the exclusive rep firm for over 2,000
radio stations nationwide, including radio stations owned by seven of the ten
largest radio groups by revenue. Our market share in the ten largest U.S. radio
markets (as defined by Arbitron) was an estimated 55% for 2001. We serve
innovative radio station groups, while still meeting the needs of independent
stations nationwide. We have grown to be a leader in radio by improving our
clients' advertising revenues, acquiring station representation contracts,
creating and acquiring other rep firms and offering advertisers creative
marketing solutions to achieve their goals. Today, our solutions include not
only radio, but the Internet.

    Our 21 offices across the country enable us to serve our radio station
clients and advertisers in all 50 states and portions of Mexico and Canada. We
provide national sales representation for clients whose diverse formats include
country, rock, sports, Hispanic, classical, urban, news, talk, oldies, adult
contemporary, jazz, contemporary hits and public radio. We have developed
strong relationships with our clients and the agencies and buying services that
purchase advertising.

    Interep is an advertising sales and marketing company that is a preeminent
leader in the radio industry. We believe we can extend our success in radio to
other types of media that we integrate into our roster of marketing and sales
services. We have already incorporated the Internet into our service offerings,
and believe that Internet advertising presents growth opportunities similar to
those present in the early days of radio advertising. Our intention is to
enable our clients to exploit the strong overlap in demographic composition and
usage patterns between radio listeners and Internet users.

                                      2

<PAGE>

    Radio stations generally retain national rep firms on an exclusive basis to
sell national spot commercial air time on their stations to advertisers outside
of their local markets. The station's own sales force handles sales of air time
to local advertisers. National spot radio advertising is placed or "spotted" in
one or more broadcast markets, in contrast to network advertising, which is
broadcast simultaneously on network affiliated stations. National spot radio
advertising typically accounts for approximately 20% of a radio station's
revenues.

    A rep firm promotes the benefits of buying advertising time on its client
radio stations to advertising agencies and media buying services and arranges
for the placement of specific advertisements. Rep firms generate revenues by
earning commissions on the sale of advertising time on client stations. Radio
stations outsource their national spot advertising sales to rep firms to
benefit from the rep firm's professional sales staff, proprietary research and
established relationships with advertisers and agencies.

    We believe the following factors have contributed to our position as an
industry leader in radio advertising and provide a strong foundation for
further growth as an advertising sales and marketing services company:

    Strong Relationships with Advertisers; National Presence.  Our strong
relationships with advertisers, advertising agencies and media buying services
nationwide enable us to promote our client stations effectively and position us
to present other types of media to them. We understand the markets and the
advertisers' needs. We work closely with advertisers to help them develop and
refine radio advertising strategies and to support their purchases of
advertising time on our client stations. Our sales force is strategically
located across the country to provide effective coverage of all major media
buying centers. Our market leadership enhances our value to advertisers,
increases our ability to sell air time for clients and allows us to package
radio stations creatively to meet advertisers' special needs. We believe that
our market leadership will enable us to integrate Internet advertising and
other forms of advertising media into our business.

    Innovative Solutions.  We have pioneered a variety of innovative solutions
for the radio industry. For example, we were the first to package and market
unaffiliated portfolios of client stations by grouping them together as
"unwired networks" to meet advertisers' particular needs. Unwired networks
enable radio advertisers and advertising agencies to target specific groups or
markets by placing advertisements on as few as two stations or as many as all
of the over 2,000 stations represented by us. Advertising agencies and media
buyers derive additional benefits from our unwired networks as we often perform
research, scheduling, billing, payment, pre-analysis and post-analysis
functions relating to the advertising time purchase. We also use promotions and
specialized agency sales targeted at boutique agencies. We developed the use of
dedicated radio sales representation firms, such as ABC Radio Sales and
Infinity Radio Sales, which enable a client to benefit from our comprehensive
services while still projecting its corporate identity to advertisers.

    We Continue to Innovate.  We are developing and testing RadioExchange(TM),
an Internet-based system for enhancing communications among advertisers, rep
firms and radio stations about air time inventory and order placement. Another
example is Interep Interactive, which we organized in 1999 to focus on the
Internet. In late 2000, we merged Interep Interactive with Cybereps, Inc., an
independent Internet advertising firm in which we already had a minority
interest. The combined

                                      3

<PAGE>

company sells Internet advertising by serving as an intermediary between
website operators and advertisers in need of suitable websites to communicate
their messages. We also provide online marketing research on a secure basis to
clients and advertisers.

    Our Interep Marketing Group is another example of our proactive, innovative
approach to sales. This Group advances the ongoing growth of radio advertising
by focusing on advertisers who do not use or who underutilize radio
advertising. The Group's sales force works with these advertisers to
demonstrate how radio can help them achieve their goals and create marketing
opportunities. We believe that the Group has contributed to the growth of radio
advertising revenues in the aggregate and, by extension, our own growth.

    Highly Skilled Sales Force and Sophisticated Sales Support.  We have a
highly skilled, professional sales force. Our sales force has a team-oriented
approach to sales, marketing and client relationships instilled through
incentive programs and the continuous, in-house training programs of the
Interep Radio University. Most of our professional employees spend
approximately two weeks each year in the Interep Radio University and receive
training from both staff members and instructors from leading marketing and
management education programs. We support our sales efforts with sophisticated
media research, including a proprietary nationwide database. This research
enables us to profile for advertisers the relevant characteristics of the
audiences of our clients, to assist them in reaching their target audiences. We
also provide concept development and sales promotion services, such as
advertising support, merchandising and sales incentive programs, which enable
us to suggest promotional campaigns, including partnerships with other
advertising media.

    Experienced Management Team.  We have an experienced and entrepreneurial
management team, headed by our Chief Executive Officer, Ralph C. Guild, a
recognized leader and innovator in the radio industry. Our senior sales
management have an average of over 25 years of industry experience and
significant equity ownership in Interep.

    Cross Marketing.  Our strong relationships with advertisers places us in a
unique position to offer all of our marketing services to them. The Interep
Marketing Group works closely with our radio and Internet sales forces to
cross-market Internet advertising with radio and to reach potential radio
advertisers who currently advertise over other media. We intend to leverage our
ability to cross-market as we incorporate other advertising media into the
services we offer our advertisers.

    Independence.  We are a publicly owned company. We believe that our
independence reduces perceived conflicts of interest in our sales efforts on
behalf of our clients.

    Strategic Investments.  We have made investments in Internet advertising.
We will continue to consider strategic investments or acquisitions in our
industry and in new media to improve our market share and to better leverage
our marketing capabilities.

Clients

    Our client radio stations generally retain us on an exclusive basis through
written agreements. These rep contracts generally provide for an initial term
followed by an "evergreen" period, meaning that the contract term continues
until canceled following 12 months' prior notice. If the client

                                      4

<PAGE>

terminates the contract without cause, the rep contracts generally provide for
termination payments equal to the estimated commissions that would have been
payable to the rep firm during the remaining portion of the term and the
evergreen period, plus two months. For example, if a contract with an initial
term of five years and a one-year evergreen period is canceled after three
years, we would be compensated in an amount equal to 38 months of commissions:
24 months for the remaining term, 12 months for the evergreen notice period,
plus two "spill over" months. "Spill over" commissions are those earned on
advertising placed or committed to prior to the contract termination but
broadcast later. It is customary in the industry for the successor rep firm to
make this payment. However, certain contracts representing material revenues
permit clients in certain circumstances to terminate their agreements with less
than 12 months' notice and pay termination and evergreen payments over shorter
periods of time.

    For the year ended December 31, 2001, no station or station group, other
than Infinity, accounted for more than 10 percent of our commission revenues.

Competition

    Our success in radio advertising sales depends on our ability to acquire
and retain representation contracts with radio stations. The media
representation business is highly competitive, both in the competition for
clients and in the sale of air time to advertisers. Our only significant
competitor in the national spot radio representation industry is Katz Media
Group, Inc., a subsidiary of Clear Channel Communications, Inc., a major media
company. We also compete with other independent and network media
representatives, direct national advertisers, national radio networks,
syndicators and other brokers of radio advertising. Moreover, on behalf of our
clients, we compete for advertising dollars with other media such as broadcast
and cable television, newspapers, magazines, outdoor and transit advertising,
Internet advertising, point-of-sale advertising and yellow pages directories.
Certain of our competitors have greater financial and other resources than we
do, and such resources may provide them with a competitive advantage in
competing for client stations or advertising expenditures.

    The change of ownership of a client station frequently results in a change
of representation firm. The pace of consolidation in the radio industry has
increased as a result of the Telecommunications Act of 1996, resulting in
larger station groups. The resulting increase in the number of ownership
changes of radio stations has increased the frequency of the termination or
buyout of representation contracts. Further, as station groups have become
larger, they have gained bargaining power with representation firms over rates
and terms. As a result, we continually compete for both the acquisition of new
client stations as well as the maintenance of existing relationships.

    We believe that our ability to compete successfully is based on:

   .  the number of stations and the inventory of air we represent;

   .  our strong relationships with advertisers;

   .  the experience of our management and the training and motivation of our
      sales personnel;

   .  our past performance;

   .  our ability to offer unwired networks;

   .  our use of technology; and

   .  our research and marketing services for clients and advertisers.

                                      5

<PAGE>

    We believe that we compete effectively, in part, through our employees'
knowledge of, and experience in, our business and industry and their long
standing relationships with clients.

Employees

    As of December 31, 2001, we employed approximately 540 employees,
substantially all of whom were sales-related personnel. None of our employees
are represented by a union. We believe that our relations with our employees
are excellent.

Executive Officers

    The following table sets forth certain information regarding our executive
officers:

<TABLE>
<CAPTION>
 Name                    Age                     Positions
 ----                    ---                     ---------
 <C>                     <C> <S>
 Ralph C. Guild......... 74  Chairman of the Board and Chief Executive Officer;
                             Director
 Marc G. Guild.......... 52  President, Marketing Division; Director
 William J. McEntee, Jr. 59  Vice President and Chief Financial Officer
</TABLE>

    All executive officers are appointed for terms of one year.

    Ralph C. Guild has been Chairman of the Board and Chief Executive Officer
of the Company since 1986, and has served as a director of the Company since
1967. He has been employed by the Company or its predecessors since 1957 in
various capacities. In November 1991, Mr. Guild became one of the first
inductees into the Broadcasting Hall of Fame. Mr. Guild serves on the Boards of
Trustees of the Museum of Television & Radio, the Center for Communications and
the University of the Pacific. In April 1998, Mr. Guild received the Golden
Mike Award from the Broadcasters Foundation for outstanding contributions to
the radio industry. In March 2001, Mr. Guild received the International Radio &
Television Society's Golden Medal Award.

    Marc G. Guild has been President, Marketing Division, of the Company since
November 1989, and has served as a director of the Company since 1989. He was
Executive Vice President of Network Sales/Operations of the Company from 1986
to 1989. Mr. Guild has been employed by the Company or its predecessors since
1972 in various capacities. As President of our Marketing Division, Mr. Guild
plays a key role in the Company's sales and marketing programs, the Interep
Radio University and the Company's research and technology divisions and also
oversees the Company's regional executives. Mr. Guild serves on the Board of
Directors of the International Radio and Television Foundation. Marc Guild is
the son of Ralph Guild.

    William J. McEntee, Jr. has been Vice President and Chief Financial Officer
of the Company since March 1997. Mr. McEntee serves in such positions pursuant
to a Services Agreement between the Company and Media Financial Services, Inc.
Mr. McEntee was Chief Financial Officer at Sudbrink Broadcasting in West Palm
Beach, Florida, from 1971 through 1994. Mr. McEntee owned and managed WCEE-TV
in Mt. Vernon, Illinois from 1994 until selling the station in 1996. Mr.
McEntee currently owns WIOJ-AM in Jacksonville, Florida. He is a certified
public accountant and formerly served as an audit manager for Arthur Andersen &
Co.

                                      6

<PAGE>

About Us

    Interep National Radio Sales, Inc. is a New York corporation founded in
1953. Our principal executive offices are located at 100 Park Avenue, New York,
New York 10017. Our telephone number is (212) 916-0700, and our Internet
address is www.interep.com.

Financial Information

    Please refer to our financial statements in this Report commencing on page
F-1 for information regarding our results of operations. Substantially all of
our revenues are generated in, and our long-lived assets are located in, the
United States.

Item 2.  PROPERTIES

    We lease approximately 128,000 square feet of office space in 15 cities
throughout the United States. Our principal executive offices are located at
100 Park Avenue, New York, New York, where we occupy 38,400 square feet under a
lease, which expires in March 2005. We believe that our office premises are
adequate for our foreseeable needs.

Item 3.  LITIGATION

    We are involved in a number of judicial and administrative proceedings
(including those described below) concerning matters arising in connection with
the conduct of our business. We believe, based on currently available
information, that the results of such proceedings, in the aggregate, will not
have a material adverse effect on our financial condition.

    Katz Media Group, Inc., our principal competitor, and certain of its
subsidiaries (together, "Katz"), instituted separate actions against four of
our radio station clients in the New York Supreme Court, County of New York,
from 1999 to 2001. In each case, our client (or its predecessor) was formerly
represented by Katz, and Katz sued for monetary damages for alleged breaches of
the representation agreement between Katz and the client stemming from the
termination of the agreement by the client when it opted to retain us as its
rep firm. In each case, we had agreed to indemnify our client against any
liabilities that may arise from such termination, including customary
termination payments and the costs of the litigation. The dispute in each case
primarily concerned whether termination payments were owed to Katz, and, if so,
the amount of such payments. The parties have entered into an agreement in
principle to settle this litigation. The terms of the settlement provide that
various contract termination payments payable by both parties to each other
will be offset, leaving a balance payable by Interep to Katz, which will be
paid in installments through 2005.

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    None.

                                    PART II

Item 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

    We listed our Class A Common Stock for quotation on the Nasdaq National
Market on December 9, 1999. The Class A Common Stock trades under the symbol
"IREP." On March 25, 2002, the last sale price of the Class A Common Stock on
the Nasdaq National Market was $4.50 per share. The following table sets forth
the range of high and low closing prices for our Class A Common Stock

                                      7

<PAGE>

for the periods indicated. Such over-the-counter market quotations reflect
inter-dealer prices, without retail mark-up, mark-down or commission and may
not necessarily represent actual transactions.

<TABLE>
<CAPTION>
                        Quarter              High   Low
                        -------             ------ -----
                        <S>                 <C>    <C>
                        First Quarter 2000. $15.00 $6.69
                        Second Quarter 2000 $ 7.50 $5.31
                        Third Quarter 2000. $ 6.75 $3.13
                        Fourth Quarter 2000 $ 4.00 $2.75
                        First Quarter 2001. $ 6.06 $3.38
                        Second Quarter 2001 $ 5.80 $2.38
                        Third Quarter 2001. $ 7.20 $2.75
                        Fourth Quarter 2001 $ 5.14 $2.30
</TABLE>

    As of March 25, 2002, there were approximately 132 holders of record of our
Class A Common Stock. We believe that there are approximately 1,100 beneficial
owners of our Class A Common Stock.

Dividend Policy

    We have not paid any dividends on our common stock in the past two years,
and we do not intend to pay any cash dividends on our common stock in the
foreseeable future. Moreover, the terms of the documents governing our
indebtedness prohibit the payment of cash dividends on our common stock. Please
read "Management's Discussion and Analysis of Financial Condition and Results
of Operations-Liquidity and Capital Resources" for additional information.

Recent Sales of Unregistered Securities

    On April 25, 2000, Interep granted options to acquire an aggregate 775,300
shares of common stock to certain employees of Interep at a per share exercise
price of $8.87 (subsequently decreased to $2.81). Of those options granted,
Messrs. Ralph Guild, Marc Guild and William McEntee received options to acquire
125,000, 40,000 and 40,000 shares, respectively.

    On June 29, 2001, Interep sold 308,641 shares of Class B Common Stock to
the Interep Stock Growth Plan at a price per share of $4.86 for an aggregate
purchase price of $1,500,000. The purchase price was determined based on the
trailing 20 trading-day average of Interep's Class A Common Stock. One share of
Class B Common Stock is convertible into one share of Class A Common Stock.

    On September 1, 2001, Interep sold 142,450 shares of Class B Common Stock
to the Interep Stock Growth Plan at a purchase price per share of $3.51 for an
aggregate purchase price of $500,000. The share price was determined in the
same manner as it was for the June 2001 issuance.

    On December 30, 2001, Interep sold 229,239 shares of Class B Common Stock
to the Interep Stock Growth Plan at a purchase price per share of $3.42 for an
aggregate purchase price of $783,997. The share price was determined in the
same manner as it was for the June 2001 issuance.

    The issuances of the above securities were intended to be exempt from
registration under the Securities Act in reliance on Section 4(2) thereof as
transactions by an issuer not involving any public offering. The recipients of
securities in each of these transactions represented their intentions to
acquire the securities for investment only and not with a view to, or for sale
in connection with, any distribution thereof and appropriate legends were
affixed to the share certificates, warrants and options

                                      8

<PAGE>

issued in such transactions. We believe that all recipients had adequate
access, through their relationships with the registrant, to information about
the registrant.

    On December 9, 1999, Interep's Articles of Incorporation were amended and
restated so that (i) the number of authorized shares of common stock was
increased from 1,000,000 to 30,000,000 (20,000,000 shares of Class A Common
Stock and 10,000,000 shares of Class B Common Stock) and (ii) each outstanding
share of common stock was converted into 20.896 shares of Class B Common Stock.
This transaction was conducted in reliance on the exemption from registration
under the Securities Act of 1933 provided by Section 3(a)(9) thereof.

Item 6.  SELECTED FINANCIAL DATA

    The following table contains selected consolidated financial information
derived from our audited consolidated financial statements set forth elsewhere
in this Form 10-K or in Forms 10-K previously filed with the SEC, and you
should review the data in the table below in conjunction with those audited
consolidated financial statements and the notes thereto. The following tables
summarize certain consolidated financial data derived from the audited
consolidated financial statements of the Company for the fiscal years ended
December 31, 2001, 2000, 1999, 1998 and 1997, respectively.

<TABLE>
<CAPTION>
                                                           Year Ended December 31,
                                         -----------------------------------------------------------
                                            2001         2000        1999        1998        1997
                                         -----------  ----------  ----------  ----------  ----------
                                                      (in thousands, except share data)
<S>                                      <C>          <C>         <C>         <C>         <C>
Statement of Operations Data:
Commission revenues.....................  $   81,128  $  100,599  $   96,540  $   87,735  $   87,096
Contract termination revenue............      21,431       7,171       6,838      37,221      26,586
                                         -----------  ----------  ----------  ----------  ----------
    Total revenues......................     102,559     107,770     103,378     124,956     113,682
Operating expenses:
Selling, general and administrative
  expenses..............................      77,707      77,731      78,774      73,482      75,676
Depreciation and amortization expense...      36,673      26,448      32,717      36,436      28,954
                                         -----------  ----------  ----------  ----------  ----------
Total operating expenses................     114,380     104,179     111,491     109,918     104,630
                                         -----------  ----------  ----------  ----------  ----------
Operating (loss) income.................     (11,821)      3,591      (8,113)     15,038       9,052
Interest expense, net...................       9,416       7,796      10,213       6,744       3,779
Loss on equity investment...............       3,340         378          --          --          --
Other income............................        (236)         --          --          --          --
                                         -----------  ----------  ----------  ----------  ----------
(Loss) income before (benefit) provision
  for income taxes......................     (24,341)     (4,583)    (18,326)      8,294       5,273
(Benefit) provision for income taxes....      (4,486)     (1,678)     (6,148)      3,446       2,359
                                         -----------  ----------  ----------  ----------  ----------
Net (loss) income.......................     (19,855)     (2,905)    (12,178)      4,848       2,914
Preferred stock dividend requirements
  and redemption premium................          --          --          --       5,031       1,590
                                         -----------  ----------  ----------  ----------  ----------
Net (loss) income applicable to common
  shareholders..........................  $  (19,855) $   (2,905) $  (12,178) $     (183) $    1,324
                                         ===========  ==========  ==========  ==========  ==========
Basic (loss) earnings per common share..  $    (2.28) $    (0.31) $    (1.97) $    (0.03) $     0.18
                                         ===========  ==========  ==========  ==========  ==========
Basic weighted average common shares
  outstanding...........................   8,715,129   9,306,826   6,182,191   6,743,803   7,476,228
Diluted (loss) earnings per common
  share.................................  $    (2.28) $    (0.31) $    (1.97) $    (0.03) $     0.17
                                         ===========  ==========  ==========  ==========  ==========
Diluted weighted average common
  shares outstanding....................   8,715,129   9,306,826   6,182,191   6,743,803   7,663,874
</TABLE>

                                      9

<PAGE>

<TABLE>
<CAPTION>
                                                            December 31,
                                           ---------------------------------------------
                                             2001     2000     1999     1998      1997
                                           -------- -------- -------- --------  --------
                                                           (in thousands)
<S>                                        <C>      <C>      <C>      <C>       <C>
Balance Sheet Data:
Cash and cash equivalents................. $ 11,502 $ 23,681 $ 66,725 $ 32,962  $  1,419
Marketable securities.....................       --    9,965       --       --        --
Working capital...........................   41,499   54,634   87,134   66,111    31,516
Total assets..............................  179,729  221,544  226,320  184,508   141,030
Long-term debt (including current portion)   99,000   99,000  100,000  100,103    44,425
Redeemable preferred stock................       --       --       --       --     6,924
Redeemable common stock...................       --       --       --       --     4,522
Stockholders' equity (deficit)............    4,290   20,570   33,486   (1,222)   (1,609)
</TABLE>

Item 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

    The following discussion is based upon and should be read in conjunction
with the previous section, Selected Financial Data, and our Consolidated
Financial Statements, including the notes thereto, which begin on page F-1.

Overview

    We derive a substantial majority of our revenues from commissions on sales
by us of national spot radio advertising airtime for the radio stations we
represent. Generally, advertising agencies or media buying services retained by
advertisers purchase national spot advertising time. We receive commissions
from our client radio stations based on the national spot radio advertising
billings of the station, net of standard advertising agency and media buying
services commissions. We enter into written representation contracts with our
clients, which include negotiated commission rates. Because commissions are
based on the prices paid to radio stations for spots, our revenue base is
essentially adjusted for inflation.

    Our operating results generally depend on:

   .  changes in advertising expenditures;

   .  increases and decreases in the size of the total national spot radio
      advertising market;

   .  changes in our share of this market;

   .  acquisitions and terminations of representation contracts; and

   .  operating expense levels.

    The effect of these factors on our financial condition and results of
operations varies from period to period.

    A number of factors influence the performance of the national spot radio
advertising market, including, but not limited to, general economic conditions,
consumer attitudes and spending patterns, the amount spent on advertising
generally, the share of total advertising spent on radio and the share of total
radio advertising represented by national spot radio. In this regard, we, like
other media businesses, were adversely affected by a slowing economy generally,
and the events of September 11, 2001, in particular, which we believe
contributed to a decrease in the amount spent on advertising in 2001.

                                      10

<PAGE>

    Our share of the national spot advertising market changes as a result of
increases and decreases in the amount of national spot advertising broadcast by
our clients. Moreover, our market share increases as we acquire representation
contracts with new client stations and decreases if current client
representation contracts are terminated. Thus, our ability to attract new
clients and to retain existing clients significantly affects our market share.

    The value of representation contracts that have been acquired or terminated
during the last few years has tended to increase due to a number of factors,
including the consolidation of ownership in the radio broadcast industry
following the passage of the Telecommunications Act of 1996. In recent years,
we have increased our representation contract acquisition activity, and we have
devoted a significant amount of our resources to these acquisitions. At the
same time, we have received an increased amount of contract termination
revenue. We base our decisions to acquire a representation contract on the
market share opportunity presented and an analysis of the costs and net
benefits to be derived. We continuously seek opportunities to acquire
additional representation contracts on attractive terms, while maintaining our
current clients. Our ability to acquire and maintain representation contracts
has had, and will continue to have, a significant impact on our revenues and
cash flows.

    We recognize revenues on a contract termination as of the effective date of
the termination. When a contract is terminated, we write off in full the
unamortized portion, if any, of the cost we originally incurred on our
acquisition of the contract. When we enter into a representation contract with
a new client, we amortize the contract acquisition cost in equal monthly
installments over the life of the new contract. As a result, our operating
income is affected, negatively or positively, by the acquisition or loss of
client stations. We are unable to forecast any trends in contract buyout
activity, or in the amount of revenues or expenses that will likely be
associated with buyouts during a particular period. Generally, the amount of
revenue resulting from the buyout of a representation contract depends on the
length of the remaining term of the contract and the revenue generated under
the contract during the 12-month "trailing period" preceding the date of
termination. The amount recognized by us as contract termination revenue in any
period is not, however, indicative of contract termination revenue that may be
realized in any future period. Historically, the level of buyout activity has
varied from period to period. Additionally, the length of the remaining terms,
and the commission revenue generation, of the contracts which are terminated in
any period vary to a considerable extent. Accordingly, while buyout activity
and the size of buyout payments has increased since 1996, their impact on our
revenues and income is expected to be uncertain, due to the variables of
contract length and commission generation.

    During 1999, we entered the Internet advertising business. Revenues and
expenses from this business are affected by the level of advertising on the
Internet generally, the prices obtained for advertising on the Internet and our
ability to obtain contracts from high-traffic Internet websites and from
Internet advertisers. In December 2000, we merged our Interep Interactive
business with Cybereps, Inc., an Internet advertising and marketing firm in
which we had a minority interest, in exchange for a majority interest in the
combined enterprise. See a further discussion of our Internet investments in
"Liquidity and Capital Resources", below.

    Our selling and corporate expense levels are dependent on management
decisions regarding operating and staffing levels, our commission income and
inflation. Selling expenses represent all costs associated with our marketing,
sales and sales support functions. Corporate expenses include items such as
corporate management, corporate communications, financial services, advertising
and promotion expenses and employee benefit plan contributions.

                                      11

<PAGE>

    Our business generally follows the pattern of advertising expenditures. It
is seasonal to the extent that radio advertising spending increases during the
fourth calendar quarter in connection with the Christmas season and tends to be
weaker during the first calendar quarter. Radio advertising also generally
increases during the second and third quarters due to holiday-related
advertising, school vacations and back-to-school sales. Additionally, radio
tends to experience increases in the amount of advertising revenues as a result
of special events such as political election campaigns. Furthermore, the level
of advertising revenues of radio stations, and therefore our level of revenues,
is susceptible to prevailing general and local economic conditions and the
corresponding increases or decreases in the budgets of advertisers, as well as
market conditions and trends affecting advertising expenditures in specific
industries.

Results of Operations

Year Ended December 31, 2001 Compared to Year Ended December 31, 2000

    Commission revenues.  Commission revenues for 2001 decreased approximately
19.4% to $81.1 million from $100.6 million for 2000. This $19.5 million
decrease was primarily a result of an overall decline in the advertising
market, including cancellations resulting from the events of September 11,
2001, as well as the substantial reduction in advertising by Internet
companies. Moreover, 2001 had 52 broadcast weeks, as compared to 53 weeks in
2000, although the extra week, which fell between Christmas and New Year's day,
is traditionally a very slow period for national spot radio advertising.

    Contract termination revenue.  Contract termination revenue in 2001
increased $14.2 million to $21.4 million from $7.2 million in 2000. This 197%
increase was primarily attributable to the settlement in May 2001 of our
dispute regarding the amount due us as contract termination revenue from the
termination of our representation contract with Clear Channel in December 1999.
Excluding this settlement, contract termination revenue decreased 54% from
2000. During 2001, approximately 118 stations terminated representation
contracts with us, which had generated an aggregate of approximately $0.8
million of commission revenue during their 12-month trailing periods.

    Selling expenses.  Selling expenses for 2001 decreased to $65.6 million
from $66.4 million during 2000. This decrease of $0.8 million, or approximately
1.2%, would have been significantly larger (approximately 8%) due to the
related decrease in commission revenue, if not for an offset of $3.5 million in
restructuring charges and $0.7 million in non-cash compensation charges on
stock option incentives. In 2001, we implemented a strategic restructuring
program in response to difficult economic conditions and to further support our
competitive position. The restructuring charges are primarily comprised of
termination benefits for approximately 53 employees. We believe the
restructuring effort will contribute to improved future operating performance.

    General and administrative expenses.  General and administrative expenses
increased by $0.8 million to $12.1 million for 2001 from $11.3 million for
2000. This 7.1% increase was primarily due to the legal expense incurred in
connection with the Clear Channel settlement.

    Depreciation and amortization expense.  Depreciation and amortization
expense increased to $36.7 million, or 39.0%, for 2001, from $26.4 million in
2000. The amortization of costs associated with acquiring representation
contracts is included in depreciation and amortization. The increase of $10.3
million was primarily due to the write-off of $6.6 million of deferred costs
relating to our purchase of the Clear Channel representation contract in 1996.
As is our practice, we wrote off this balance of deferred costs in 2001 on the
settlement of the termination of the Clear Channel contract.

                                      12

<PAGE>

We acquired representation contracts with approximately 153 new radio stations
in 2001. We believe these contracts generated an aggregate of $1.7 million of
commission revenues during their 12-month trailing periods prior to their
acquisition. Also, in 2001, we recorded an impairment to goodwill of $2.4
million pertaining to our initial investments in Cybereps.

    Operating income (loss).  Operating income decreased by $15.4 million, to a
loss of $11.8 million for 2001, compared with operating income of $3.6 million
in 2000, for the reasons discussed above.

    Interest expense, net.  Interest expense, net increased $1.6 million, or
20.5%, to $9.4 million for 2001, from $7.8 million for 2000. This increase
primarily resulted from a decrease of interest received on cash reserves, which
partially offsets interest payable on our Senior Subordinated Notes.

    Loss on equity investment.  In 2001, the loss on equity investment includes
our share of losses incurred by Cybereps prior to the consolidation of its
operations in October 2001. It also includes a writedown of $1.9 million in the
cost basis of privately held investments primarily in the Internet advertising
industry.

    Benefit for income taxes.  The benefit for income taxes for 2001 increased
$2.8 million, or 164.7%, to $4.5 million, compared to $1.7 million for 2000, as
a result of the increase in loss before taxes. A valuation allowance was
recorded in 2001 due to an uncertainty of realizing our net deferred tax assets
in future periods.

    Net loss.  Our net loss of approximately $19.9 million for 2001, a $17.0
million increase from the $2.9 million net loss for 2000, was due to the
reasons discussed above.

Year Ended December 31, 2000 Compared to Year Ended December 31, 1999

    Commission revenues.  Commission revenues for 2000 increased approximately
4.2% to $100.6 million from $96.5 million for 1999. This $4.1 million increase
was primarily attributable to increased sales of national spot advertising on
client stations and commissions generated by new representation contracts,
offset, in part, by the loss of commission revenues from terminated contracts,
principally those with stations owned by Clear Channel, which were terminated
in December 1999. Our revenues in 2000 increased only minimally from the fact
that 2000 had 53 weeks, as compared to 52 weeks in 1999, for radio broadcast
purposes, as the extra week, falling between Christmas and New Year's day, is
traditionally a very slow period for national spot radio advertising.

    Contract termination revenue.  Contract termination revenue in 2000
increased $0.4 million to $7.2 million from $6.8 million in 1999. This 5.8%
increase was primarily attributable to the slightly greater residual value of
contracts terminated during 2000 than in 1999. The value of representation
contracts acquired or terminated during the last few years has generally tended
to increase due to the factors discussed in "Overview" above. Nevertheless, it
remains difficult to predict whether contract termination revenue will increase
or decrease in a particular year and its impact on overall revenue is
expected to continue to be uncertain, due to the variables of contract length
and commission generation. During 2000, approximately 200 client stations
terminated representation contracts with us, which had generated an aggregate
of approximately $1.5 million of commission revenue during their 12-month
trailing periods. The amount of contract termination revenue from the
termination of the Clear Channel representation contract in December 1999 had
not been determined when our 2000

                                      13

<PAGE>

Annual Report on Form 10-K was issued. In May 2001, we entered into an
agreement with Clear Channel that established their contract termination
obligation to us at approximately $18.1 million. See "Year Ended December 31,
2001 Compared to Year Ended December 31, 2000 -- Contract termination revenue",
above.

    Selling expenses.  Selling expenses for 2000 decreased to $66.4 million
from $68.0 million during 1999. This decrease of $1.6 million, or approximately
2.3%, was primarily attributable to a cost reduction program implemented in the
third quarter of 2000, offset in part by employee compensation increases
associated with the growth in commission revenues.

    General and administrative expenses.  General and administrative expenses
increased by $0.5 million to $11.3 million for 2000 from $10.8 million for
1999. This 5.0% increase primarily reflects new expenses related to our
becoming a public company.

    Depreciation and amortization expense.  Depreciation and amortization
expense decreased to $26.4 million, or 19.2%, for 2000, from $32.7 million in
1999. The amortization of costs associated with acquiring representation
contracts is included in depreciation and amortization. This decrease of $6.3
million was primarily due to the completion of the amortization of certain
representation contracts. We acquired representation contracts with
approximately 320 new radio stations in 2000. We believe these contracts
generated an aggregate of approximately $5.3 million of commission revenues
during their 12-month trailing periods prior to their acquisition.

    Operating income (loss).  Operating income increased by $11.7 million, to
income of $3.6 million for 2000 compared with an operating loss of $8.1 million
in 1999. The largest factor contributing to this increase was the decrease in
depreciation and amortization charges referred to above.

    Interest expense, net.  Interest expense, net decreased $2.4 million, or
23.7%, to $7.8 million for 2000, from $10.2 million for 1999. This decrease
primarily resulted from interest received on cash reserves, which partially
offset interest payable on our Senior Subordinated Notes.

    Provision (benefit) for income taxes.  The benefit for income taxes for
2000 declined $4.4 million, or 72.7%, to $1.7 million, compared to $6.1 million
for 1999, as a result of the lower loss before taxes.

    Net loss.  Our net loss of approximately $2.9 million for 2000, a $9.3
million decrease from the $12.2 million net loss for 1999, was due to the
reasons discussed above.

Liquidity and Capital Resources

    Cash provided from operations and financing transactions has primarily
funded our cash requirements. On December 9, 1999 we completed our initial
public offering, which resulted in net proceeds of $46.8 million. As of
December 31, 2001, we had cash and cash equivalents of $11.5 million and
working capital of $41.5 million.

    Cash provided by operations during 2001 amounted to $11.2 million, as
compared to $16.3 million and $27.4 million for the years ended 2000 and 1999,
respectively. These fluctuations were primarily attributable to contract
terminations and changes in working capital components.

    Net cash provided by investing activities during 2001 amounted to $9.3
million, primarily from the sale of marketable securities offset by capital
expenditures. Capital expenditures totaled $0.7

                                      14

<PAGE>

million, $0.8 million and $2.9 million for 2001, 2000 and 1999, respectively,
primarily for office and computer equipment. Investments in private companies
amounted to $4.8 million and $5.7 million for 2000 and 1999, respectively, and
consisted of minority equity positions in Internet advertising firms. In
December 1999, Ralph Guild acquired shares in one of such firms, Cybereps,
Inc., from one of its founders at a price higher than we paid. In February
2000, we invested an additional $1.14 million in Cybereps on the same terms as
our initial investment, and in December 2000, we acquired a majority interest
in Cybereps through a merger of our Interep Interactive business with Cybereps
and an additional investment of $3 million to the combined business.

    We evaluated the carrying value of our investments in such Internet
advertising firms and during 2001 recognized an impairment of $2.4 million on
the goodwill resulting from the Cybereps investment and $1.9 million on the
carrying value of the other privately held investments. As part of the
evaluation, we considered, among other factors, the business plans of these
firms, the quality and effectiveness of their management teams, their liquidity
and capital resource positions, and their business relationships with third
parties. There can be no assurance that circumstances affecting these
investments, their businesses and the markets in which they operate will not
change in a manner which would lead to a conclusion in a future period that an
additional impairment had occurred.

    Cash used for financing activities of $32.6 million during 2001 consisted
primarily of $35.5 million for acquisitions of representation contracts, offset
by $2.9 million of proceeds from the issuance of Class B common stock to our
Stock Growth Plan. Cash used for financing activities of $43.9 million during
2000 consisted primarily of $32.2 million for acquisitions of representation
contracts and $10.5 million to purchase our stock in the open market. Cash
provided by financing activities during 1999 was $15.0 million resulting from
the proceeds of our initial public offering, offset by cash used for
acquisitions of station representation contracts.

    In general, as we acquire new representation contracts, we use more cash
and, as our contracts are terminated, we receive additional cash. For the
reasons noted above in "Overview," we are not able to predict the amount of
cash we will require for contract acquisitions, or the cash we will receive on
contract terminations, from period to period.

    We do not have any written options on non-financial assets, nor do we have
any special-purpose entities. We have not guaranteed any obligations of any of
our unconsolidated investments.

    In July 1998 we issued 10% Senior Subordinated Notes in the aggregate
principal amount of $100.0 million due July 1, 2008. Interest on the Senior
Subordinated Notes is payable in semi-annual payments of $5.0 million. The
Senior Subordinated Notes, while guaranteed by our subsidiaries, are unsecured
and are junior to certain indebtedness. We used a portion of the net proceeds
from the issuance of the Senior Subordinated Notes to repay the then
outstanding balance of our bank debt. Additionally, we redeemed all of the
outstanding shares of our Series A preferred stock and Series B preferred
stock, together with all of the associated shares of common stock then subject
to redemption.

    We issued the Senior Subordinated Notes under an indenture that limits our
ability to engage in various activities. Among other things, we are generally
not able to pay any dividends to our stockholders, other than dividends payable
in shares of common stock; we can only incur additional indebtedness under
limited circumstances; and certain types of mergers, asset sales and changes of
control either are not permitted or permit the note holders to demand immediate
redemption of their Senior Subordinated Notes.

                                      15

<PAGE>

    The Senior Subordinated Notes may not be redeemed by us prior to July 1,
2003, except that we may redeem up to 30% of the Senior Subordinated Notes with
the proceeds of equity offerings. If certain events occurred which would be
deemed to involve a change of control under the indenture, we would be required
to offer to repurchase all of the Senior Subordinated Notes at a price equal to
101% of their aggregate principal, plus unpaid interest.

    We believe that the liquidity resulting from our initial public offering in
December 1999 and the transactions described above, together with anticipated
cash from continuing operations, should be sufficient to fund our operations
and anticipated needs for required representation contract acquisition
payments, and to make the required 10% annual interest payments on the Senior
Subordinated Notes, for at least the next 12 months. We may not, however,
generate sufficient cash flow for these purposes or to repay the notes at
maturity. In this regard, we believe that the cost-saving restructuring we
implemented in 2001 should contribute to an improvement in cash flow. Moreover,
the improvement in radio advertising pacings experienced in the first quarter
of 2002 may be indicative of an improving revenue trend that should also have a
positive effect on liquidity and cash flow. At the same time, we are currently
seeking additional debt and equity financing to enhance our working capital
position.

    Our ability to fund our operations and required contract acquisition
payments and to make scheduled principal and interest payments will depend on
our future performance, which, to a certain extent, is subject to general
economic, financial, competitive, legislative, regulatory and other factors
that are beyond our control. We may also need to refinance all or a portion of
the notes on or prior to maturity. There can be no assurance that we will be
able to effect any such refinancing on commercially reasonable terms, if at all.

Certain Factors That May Affect Our Results of Operations

    The following factors are some, but not all, of the variables that may have
an impact on our results of operations:

   .  Changes in the ownership of our radio station clients, in the demand for
      radio advertising, in our expenses, in the types of services offered by
      our competitors, and in general economic factors may adversely affect our
      ability to generate the same levels of revenue and operating results.

   .  Advertising tends to be seasonal in nature as advertisers typically spend
      less on radio advertising during the first calendar quarter.

   .  The terrorist attacks that occurred in New York City and Washington,
      D.C., on September 11, 2001, and the subsequent military actions taken by
      the United States and its allies in response, have caused significant
      uncertainty. While the consequences of these events are uncertain, we
      believe that they have likely had a material adverse effect on general
      economic conditions, consumer confidence, advertising and the media
      industry and may continue to do so in the future.

   .  The termination of a representation contract will increase our results of
      operations for the fiscal quarter in which the termination occurs due to
      the termination payments that are usually required to be paid, but will
      negatively affect our results in later quarters due to the loss of
      commission revenues. Hence, our results of operations on a quarterly
      basis are not predictable and are subject to significant fluctuations.

   .  We depend heavily on our key personnel, including our Chief Executive
      Officer Ralph C. Guild and the President of our Marketing Division Marc
      Guild, and our inability to retain them could adversely affect our
      business.

                                      16

<PAGE>

   .  We rely on a limited number of clients for a significant portion of our
      revenues.

   .  Our significant indebtedness from our Senior Subordinated Notes may
      burden our operations, which could make us more vulnerable to general
      adverse economic and industry conditions, make it more difficult to
      obtain additional financing when needed, reduce our cash flow from
      operations to make payments of principal and interest and make it more
      difficult to react to changes in our business and industry.

   .  We may need additional financing for our future capital needs, which may
      not be available on favorable terms, if at all.

   .  Competition could harm our business. Our only significant competitor is
      Katz Media Group, which is a subsidiary of a major radio station group
      that has significantly greater financial and other resources than do we.
      In addition, radio must compete for a share of advertisers' total
      advertising budgets with other advertising media such as television,
      cable, print, outdoor advertising and the Internet.

   .  Acquisitions and strategic investments could adversely affect our
      business.

   .  Our Internet business may suffer if the market for Internet advertising
      fails to develop or continues to weaken.

New Accounting Pronouncements

    Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities," was issued in June 1998 and was
subsequently amended by SFAS No. 138 issued in June 2000. These statements
require companies to record derivatives on the balance sheet as assets and
liabilities, measured at fair value. Depending on the use of a derivative and
whether it has been designated and qualifies as a hedge, gains or losses
resulting from changes in the value of the derivative would be recognized
currently in earnings or reported as a component of other comprehensive income.
These statements were effective for the Company beginning January 1, 2001. The
Company does not use derivative instruments and therefore the adoption of these
statements did not have any impact on its financial position or results of
operations.

    SFAS No. 142, "Goodwill and Other Intangible Assets," was issued in June
2001. This Statement addresses financial accounting and reporting for acquired
goodwill and other intangible assets and supersedes APB Opinion No. 17,
"Intangible Assets". It addresses how intangible assets acquired individually
or with a group of other assets (but not those acquired in a business
combination) should be accounted for in financial statements upon their
acquisition. This Statement also addresses how goodwill and other intangible
assets should be accounted for after they have been initially recognized in the
financial statements. With the adoption of this Statement, goodwill is no
longer subject to amortization over its estimated useful life. Rather, goodwill
will be subject to at least an annual assessment for impairment by applying a
fair-value-based test. Similarly, goodwill associated with equity method
investments is no longer amortized. Equity method goodwill is not, however,
subject to the new impairment rules. Effective January 1, 2002, the Company
will cease amortization of its existing goodwill. The Company is in the process
of assessing the impact of adopting the new impairment rules and may incur an
impairment charge in accordance with the adoption of this Statement.

    SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets," was issued in August 2001 and supercedes SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of". SFAS No. 144 requires that a single accounting model be applied to
long-lived assets whether such assets are held and used, are to be disposed of
other than

                                      17

<PAGE>

by sale or disposed of by sale. The accounting model requires the long-lived
asset to be recorded at the lower of its carrying amount or its fair value. The
statement also broadens the presentation of discontinued operations to include
more disposal transactions. The Company adopted this statement on January 1,
2002. The adoption of this statement is not expected to have a material impact
on the Company's consolidated financial statements.

Item 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

    We are exposed to market risk from changes in interest rates that may
adversely affect our results of operations and financial condition. We seek to
minimize the risks from these interest rate fluctuations through our regular
operating and financing activities. Our policy is not to use financial
instruments for trading or other speculative purposes. We are not currently a
party to any financial instruments.

Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

    Financial information required by this item appears in the pages marked F-1
through [F-20] at the end of this Report and is incorporated herein by
reference as if fully set forth herein.

Item 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

    None.

                                      18

<PAGE>

                                   PART III

Items 10 Through 13 Inclusive.

    The information required by Item 10 (Directors and Executive Officers of
the Registrant)(other than information as to executive officers of the Company,
which is set forth in Part I under the caption "Executive Officers"), Item 11
(Executive Compensation), Item 12 (Security Ownership of Certain Beneficial
Owners and Management) and Item 13 (Certain Relationships and Related
Transactions) is incorporated by reference to the Company's definitive proxy
statement for the 2002 Annual Meeting of Shareholders, to be filed with the
Securities and Exchange Commission on or about April 30, 2002.

                                      19

<PAGE>

                                    PART IV

Item 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(A)  Documents Filed as Part of this Report

    Financial Statements and Supplementary Data.  The following Financial
Statements of the Company are filed with this Form 10-K:

<TABLE>
<S>                                                                          <C>
Report of Independent Public Accountants.................................... F-2
Consolidated Balance Sheets as of December 31, 2001 and 2000................ F-3
Consolidated Statements of Operations for the Years Ended December 31, 2001,
  2000 and 1999............................................................. F-4
Consolidated Statements of Shareholders' Equity for the Years Ended
  December 31, 2001, 2000 and 1999.......................................... F-5
Consolidated Statements of Cash Flows for the Years Ended December 31, 2001,
  2000 and 1999............................................................. F-6
Notes to Consolidated Financial Statements.................................. F-7
</TABLE>

    Financial Statement Schedules.  The following financial statement schedule
is filed as part of this Annual Report on Form 10-K:

<TABLE>
              <S>                                            <C>
              Schedule II--Valuation and Qualifying Accounts F-22
</TABLE>

    Exhibits.  The following Exhibits are filed as part of this Report:

<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<C>         <S>
  3.1(5)    Restated Certificate of Incorporation of Interep
  3.2(5)    By-Laws of Interep
  4.1(1)    A/B Exchange Registration Rights Agreement, dated July 2, 1998, among Interep, the
            Guarantors, BancBoston Securities Inc., Loenbaum & Company Incorporated and SPP
            Hambro & Co., LLC
  4.2(1)    Indenture, dated July 2,1998, between Interep, the Guarantors and Summit Bank
  4.3(1)    Form of 10% Senior Subordinated Note (Included in Exhibit 4.2)
  4.4(3)    Supplemental Indenture, dated as of March 22, 1999, among American Radio Sales, Inc.,
            Interep, the Guarantors and Summit Bank as Trustee
  4.5(6)    Form of Registration Rights Agreement among the Interep Employee Stock Ownership
            Plan, the Interep Stock Growth Plan and Interep
 10.1(1)    Agreement of Lease, dated December 31, 1992, between The Prudential Insurance
            Company of America and Interep
 10.2(2)    Lease, dated January 1, 1990, between Ralph C. Guild, doing business as The Tuxedo
            Park Executive Conference Center and Interep, as amended by Amendment of Lease,
            dated December 3, 1998, between Ralph Guild 1990 Trust No. 1 (successor in interest to
            The Tuxedo Park Executive Conference Center) and Interep
 10.3(1)*   Agreement, dated June 29, 1998, between Interep and Ralph C. Guild
 10.4(7)*   Amended and Restated Services Agreement, dated as of January 2, 2001, between Interep
            and Media Financial Services, Inc.
 10.5(3)*   Fifth Amended and Restated Employment Agreement, dated as of March 1, 1999,
            between Interep and Ralph C. Guild
 10.6(7)*   Amended and Restated Employment Agreement, dated as of April 1, 2000, between
            Interep and Marc G. Guild
 10.7(1)*   Non-Qualified Stock Option granted to Ralph C. Guild on December 31, 1988
</TABLE>

                                      20

<PAGE>

<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<C>         <S>
 10.8(1)*   Amendment and Extension of Option, dated January 1, 1991, between Interep and Ralph
            C. Guild
 10.9(1)*   Non-Qualified Stock Option granted to Ralph C. Guild on January 1, 1991
 10.10(1)*  Non-Qualified Stock Option granted to Ralph C. Guild on December 31, 1995
 10.11(1)*  Non-Qualified Stock Option granted to Marc G. Guild on January 1, 1991
 10.12(1)*  Non-Qualified Stock Option granted to Ralph C. Guild on June 29, 1997
 10.13(1)*  Non-Qualified Stock Option granted to Marc G. Guild on June 29, 1997
 10.14(1)*  Non-Qualified Stock Option granted to William J. McEntee, Jr. on June 29, 1997
 10.15(1)*  Supplemental Income Agreement, dated December 31, 1986, between Interep and Ralph
            C. Guild
 10.16(1)*  Agreement, dated June 18, 1993, between Interep and Ralph C. Guild
 10.17(2)*  Non-Qualified Stock Option Granted to Ralph C. Guild on July 10, 1998
 10.18(2)*  Non-Qualified Stock Option Granted to Marc G. Guild July 10, 1998
 10.19(2)*  Non-Qualified Stock Option Granted to William J. McEntee, Jr. July 10, 1998
 10.20(3)*  Non-Qualified Stock Option Granted to Ralph C. Guild, December 16, 1998.
 10.21(3)*  Non-Qualified Stock Option Granted to Leslie D. Goldberg, December 16, 1998
 10.22(7)*  Non-Qualified Stock Option Granted to Ralph C. Guild on April 25, 2000
 10.23(7)*  Non-Qualified Stock Option Granted to Marc G. Guild on April 25, 2000
 10.24(7)*  Non-Qualified Stock Option Granted to William J. McEntee on April 25, 2000
 10.25(4)*  Form of Indemnification Agreement for directors and officers
 10.26(5)*  1999 Stock Incentive Plan
 10.27(6)*  Form of Stock Option Agreement
 10.28(5)   Lease Agreement, dated as of June 30, 1999 between Bronxville Family Partnership,
            L.P. and Interep
 10.29(6)*  Agreement, dated as of November 30, 1999 between Interep and Ralph C. Guild
 10.30(6)*  Agreement, dated as of November 30, 1999 between Interep and Ralph C. Guild
 10.31(5)*  Agreement, dated as of November 30, 1999 between Interep and Marc G. Guild
 21.1(7)    Subsidiaries of Interep
 23.1       Consent of Arthur Anderesen LLP (filed herewith)
 99.1       Letter, dated April 1, 2002, from Interep to the SEC regarding Arthur Andersen LLP (filed herewith)
</TABLE>
--------
*   Management or compensatory contract required to be filed pursuant to Item
    14(c) of the requirements for Form 10-K reports.
(1) Incorporated by reference to Interep's registration statement on Form S-4
    (Registration No 333-60575), filed with the Commission on August 4, 1998.
(2) Incorporated by reference to Interep's registration statement on Form
    S-4/A-2 (Registration No. 333-60575), filed with the Commission on January
    26, 1999.
(3) Incorporated by reference to Interep's Annual Report on Form 10-K for its
    fiscal year ended December 31, 1998, filed with the Commission on March 31,
    1999.
(4) Incorporated by reference to Interep's registration statement on Form S-1
    (Registration No. 333-88265), filed with the Commission on October 10, 1999.
(5) Incorporated by reference to Interep's registration statement on Form
    S-1/A-1 (Registration No. 333-88265), filed with the Commission on November
    8, 1999.
(6) Incorporated by reference to Interep's registration statement on Form
    S-1/A-4 (Registration No. 333-88265), filed with the Commission on December
    8, 1999.
(7) Incorporated by reference to Interep's Annual Report on Form 10-K for its
    fiscal year ended December 31, 2000, filed with the Commission on April 2,
    2001.

(B) Reports on Form 8-K

    None

                                      21

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

                  INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                                           Page
                                                                                           ----
<S>                                                                                        <C>
Report of Independent Public Accountants..................................................  F-2

Consolidated Balance Sheets as of December 31, 2001 and 2000..............................  F-3

Consolidated Statements of Operations for the Years Ended December 31, 2001, 2000 and 1999  F-4

Consolidated Statements of Shareholders' Equity for the Years Ended December 31, 2001,
  2000 and 1999...........................................................................  F-5

Consolidated Statements of Cash Flows for the Years Ended December 31, 2001, 2000 and 1999  F-6

Notes to Consolidated Financial Statements................................................  F-7

Financial Statement Schedule for the Years Ended December 31, 2001, 2000 and 1999:

Schedule II--Valuation and Qualifying Accounts............................................ F-22
</TABLE>

                                      F-1

<PAGE>

                   REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Interep National Radio Sales, Inc.:

    We have audited the accompanying consolidated balance sheets of Interep
National Radio Sales, Inc. (a New York corporation) and subsidiaries as of
December 31, 2001 and 2000, and the related consolidated statements of
operations, shareholders' equity and cash flows for each of the three years in
the period ended December 31, 2001. These financial statements and the schedule
referred to below are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
schedule based on our audits.

    We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

    In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Interep National Radio
Sales, Inc. and subsidiaries as of December 31, 2001 and 2000, and the results
of their operations and their cash flows for each of the three years in the
period ended December 31, 2001, in conformity with accounting principles
generally accepted in the United States.

    Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The schedule listed in the index to
consolidated financial statements is presented for purposes of complying with
the Securities and Exchange Commission's rules and is not part of the basic
financial statements. This schedule has been subjected to the auditing
procedures applied in the audits of the basic financial statements and, in our
opinion, fairly states in all material respects the financial data required to
be set forth therein in relation to the basic financial statements taken as a
whole.

                                          /s/  ARTHUR ANDERSEN LLP

New York, New York
March 14, 2002

                                      F-2

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

                          CONSOLIDATED BALANCE SHEETS
                    (in thousands except share information)

<TABLE>
<CAPTION>
                                                                                     December 31,
                                                                                  ------------------
                                                                                    2001      2000
                                                                                  --------  --------
<S>                                                                               <C>       <C>
                                     ASSETS
Current assets:
Cash and cash equivalents........................................................ $ 11,502  $ 23,681
Marketable securities............................................................       --     9,965
Receivables, less allowance for doubtful accounts of $1,747 and $1,940 in 2001
  and 2000, respectively.........................................................   26,656    33,810
Representation contract buyouts receivable.......................................   12,504     5,266
Current portion of deferred representation contract costs........................   40,368    44,240
Prepaid expenses and other current assets........................................      927     1,075
                                                                                  --------  --------
   Total current assets..........................................................   91,957   118,037
                                                                                  --------  --------
Fixed assets, net................................................................    3,909     5,046
Deferred representation contract costs...........................................   64,521    71,532
Representation contract buyouts receivable.......................................       --     6,718
Investments and other assets.....................................................   19,342    20,211
                                                                                  --------  --------
   Total assets.................................................................. $179,729  $221,544
                                                                                  ========  ========

                      LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses............................................ $  8,606  $ 16,121
Accrued interest.................................................................    4,950     4,950
Representation contract buyouts payable..........................................   33,161    36,116
Accrued employee-related liabilities.............................................    3,741     6,216
                                                                                  --------  --------
   Total current liabilities.....................................................   50,458    63,403
                                                                                  --------  --------
Long-term debt...................................................................   99,000    99,000
                                                                                  --------  --------
Representation contract buyouts payable..........................................   21,267    34,119
                                                                                  --------  --------
Other noncurrent liabilities.....................................................    4,714     4,452
                                                                                  --------  --------
Commitments and Contingencies:

Shareholders' equity:
Class A common stock, $.01 par value--20,000,000 shares authorized, 4,907,996 and
  4,614,143 shares issued and outstanding at December 31, 2001 and 2000,
  respectively...................................................................       49        46
Class B common stock, $.01 par value--10,000,000 shares authorized, 4,314,463 and
  3,901,486 shares issued and outstanding at December 31, 2001 and 2000,
  respectively...................................................................       43        39
Additional paid-in-capital.......................................................   39,456    35,888
Accumulated deficit..............................................................  (35,258)  (15,403)
                                                                                  --------  --------
   Total shareholders' equity....................................................    4,290    20,570
                                                                                  --------  --------
   Total liabilities and shareholders' equity.................................... $179,729  $221,544
                                                                                  ========  ========
</TABLE>

   The accompanying notes are an integral part of these consolidated balance
                                    sheets.

                                      F-3

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     (in thousands except per share data)

<TABLE>
<CAPTION>
                                            For the Year Ended December 31,
                                            ------------------------------
                                              2001        2000      1999
                                            --------    --------  --------
      <S>                                   <C>         <C>       <C>
      Commission revenues.................. $ 81,128    $100,599  $ 96,540
      Contract termination revenue.........   21,431       7,171     6,838
                                            --------    --------  --------
         Total revenues....................  102,559     107,770   103,378
      Operating expenses:
      Selling expenses.....................   65,604      66,410    67,995
      General and administrative expenses..   12,103      11,321    10,779
      Depreciation and amortization expense   36,673      26,448    32,717
                                            --------    --------  --------
         Total operating expenses..........  114,380     104,179   111,491
      Operating (loss) income..............  (11,821)      3,591    (8,113)
      Interest expense, net................    9,416       7,796    10,213
      Loss on equity investment............    3,340         378        --
      Other income.........................     (236)         --        --
                                            --------    --------  --------
      Loss before benefit for income taxes.  (24,341)     (4,583)  (18,326)
      Benefit for income taxes.............   (4,486)     (1,678)   (6,148)
                                            --------    --------  --------
      Net loss............................. $(19,855)   $ (2,905) $(12,178)
                                            ========    ========  ========
      Basic and diluted loss per share..... $  (2.28)   $  (0.31) $  (1.97)
                                            ========    ========  ========
</TABLE>

 The accompanying notes are an integral part of these consolidated statements.


                                      F-4

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

                CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                    (in thousands except share information)
<TABLE>
<CAPTION>
                                       Class A            Class B
                                     Common Stock       Common Stock                                         Treasury Stock
                                  -----------------  -----------------             -                      -------------------
                                    Shares    Amount   Shares    Amount Additional Accumulated Receivable   Shares    Amount
                                  ----------  ------ ----------  ------  Paid-in     Deficit      from    ----------  -------
                                                                         Capital   -----------    ESOP
                                                                        ----------             ----------
<S>                               <C>         <C>    <C>         <C>    <C>        <C>         <C>        <C>         <C>
Balance, January 1, 1999.........         --   $ --   6,991,350   $ 70   $  1,107   $   (320)     $(82)   (1,079,716) $(1,997)
Net loss.........................         --     --          --     --         --    (12,178)       --            --       --
Treasury stock purchases.........         --     --          --     --         --         --        --          (172)     (14)
Retirement of treasury stock.....         --     --  (1,079,888)   (11)    (2,000)        --        --     1,079,888    2,011
Reduction of receivable from
  ESOP...........................         --     --          --     --         --         --        82            --       --
Conversion of common stock.......    987,500     10    (987,500)   (10)        --         --        --            --       --
Sale of common stock under public
  offering, net of expenses......  4,429,167     44          --     --     46,774         --        --            --       --
                                  ----------   ----  ----------   ----   --------   --------      ----    ----------  -------

Balance, December 31, 1999.......  5,416,667     54   4,923,962     49     45,881    (12,498)       --            --       --
Net loss.........................         --     --          --     --         --     (2,905)       --            --       --
Conversion of common stock.......  1,022,476     10  (1,022,476)   (10)        --         --        --            --       --
Stock repurchases................ (1,825,000)   (18)         --     --    (10,528)        --        --            --       --
Earned compensation, executive
  stock options..................         --     --          --     --        535         --        --            --       --
                                  ----------   ----  ----------   ----   --------   --------      ----    ----------  -------

Balance, December 31, 2000.......  4,614,143     46   3,901,486     39     35,888    (15,403)       --            --       --
Net loss.........................         --     --          --     --         --    (19,855)       --            --       --
Conversion of common stock.......    267,353      3    (267,353)    (3)
Exercise of stock options........     26,500                                   76         --        --            --       --
Issuance to Stock Growth Plan....         --     --     680,330      7      2,777         --        --            --       --
Earned compensation, executive
  stock options..................         --     --          --     --        715         --        --            --       --
                                  ----------   ----  ----------   ----   --------   --------      ----    ----------  -------

Balance, December 31, 2001.......  4,907,996   $ 49   4,314,463   $ 43   $ 39,456   $(35,258)     $ --            --  $    --
                                  ==========   ====  ==========   ====   ========   ========      ====    ==========  =======
</TABLE>

 The accompanying notes are an integral part of these consolidated statements.

                                      F-5

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (in thousands)

<TABLE>
<CAPTION>
                                                                              For the Year Ended December 31,
                                                                              ------------------------------
                                                                                2001        2000      1999
                                                                              --------    --------  --------
<S>                                                                           <C>         <C>       <C>
Cash flows from operating activities:
Net loss..................................................................... $(19,855)   $ (2,905) $(12,178)
Adjustments to reconcile income to net cash provided by operating activities:
   Depreciation and amortization.............................................   36,673      26,448    32,717
   Equity Loss on equity investment..........................................    3,340         378        --
   Non-cash compensation expense.............................................      715         535        --
Changes in assets and liabilities--
   Receivables...............................................................    7,154      (1,728)    3,022
   Representation contract buyouts receivable................................     (520)       (886)    7,269
   Prepaid expenses and other current assets.................................      148         (47)      179
   Other noncurrent assets...................................................   (6,772)       (545)   (1,480)
   Accounts payable and accrued expenses.....................................   (7,515)     (2,413)    1,894
   Accrued interest..........................................................       --         (50)       28
   Accrued employee-related liabilities......................................   (2,475)     (1,407)    1,103
   Other noncurrent liabilities..............................................      262      (1,048)   (5,173)
                                                                              --------    --------  --------
Net cash provided by operating activities....................................   11,155      16,332    27,381
                                                                              --------    --------  --------
Cash flows from investing activities:
Additions to fixed assets....................................................     (681)       (791)   (2,900)
Increase in other investments................................................       --      (4,840)   (5,678)
Redemption of marketable securities..........................................    9,965          --        --
Purchase of marketable securities............................................       --      (9,800)       --
                                                                              --------    --------  --------
Net cash provided by (used in) investing activities..........................    9,284     (15,431)   (8,578)
                                                                              --------    --------  --------
Cash flows from financing activities:
Station representation contracts payments....................................  (35,478)    (32,235)  (31,926)
Debt repayments..............................................................       --      (1,000)       --
Sales and issuances of stock, net of issuance costs..........................    2,860          --    46,774
Stock repurchases............................................................       --     (10,546)      (14)
Other, net...................................................................       --        (164)      126
                                                                              --------    --------  --------
Net cash (used in) provided by financing activities..........................  (32,618)    (43,945)   14,960
                                                                              --------    --------  --------
Net (decrease) increase in cash and cash equivalents.........................  (12,179)    (43,044)   33,763
Cash and cash equivalents, beginning of year.................................   23,681      66,725    32,962
                                                                              --------    --------  --------
Cash and cash equivalents, end of year....................................... $ 11,502    $ 23,681  $ 66,725
                                                                              ========    ========  ========
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest paid................................................................ $  9,900    $ 10,000  $  9,972
Income taxes paid, net.......................................................      452         354       906
Non-cash investing and financing activities:
Station representation contracts acquired.................................... $ 19,648    $ 47,984  $ 41,266
</TABLE>

 The accompanying notes are an integral part of these consolidated statements.

                                      F-6

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    (in thousands except share information)

1.  Summary of Significant Accounting Policies

  Principles of Consolidation

    The consolidated financial statements include the accounts of Interep
National Radio Sales, Inc. ("Interep"), together with its subsidiaries
(collectively, the "Company"). All significant intercompany transactions and
balances have been eliminated.

  Revenue Recognition

    The Company is a national representation ("rep") firm serving radio
broadcast clients throughout the United States. Commission revenues are derived
from sales of advertising time for radio stations under representation
contracts. Commissions and fees are recognized in the month the advertisement
is broadcast. In connection with its unwired network business, the Company
collects fees for unwired network radio advertising and, after deducting its
commissions, remits the fees to the respective radio stations. Fees payable to
stations have been offset against the related receivable from advertising
agencies in the accompanying consolidated balance sheets. For the years ended
December 31, 2001, 2000 and 1999, commission revenues include revenue derived
from sales of advertising on the internet of $761, $787 and $210, respectively.
The Company records all commission revenues on a net basis. Commissions are
recognized based on the standard broadcast calendar that ends on the last
Sunday in each reporting period. The broadcast calendar for the calendar years
ended December 31, 2001, 2000, and 1999 had 52, 53, and 52 weeks, respectively.

  Representation Contract Termination Revenue and Contract Acquisition Costs

    The Company's station representation contracts usually renew automatically
from year to year unless either party provides written notice of termination at
least twelve months prior to the next automatic renewal date. In accordance
with industry practice, in lieu of termination, an arrangement is normally made
for the purchase of such contracts by a successor representative firm. The
purchase price paid by the successor representation firm is generally based
upon the historic commission income projected over the remaining contract
period plus two months.

    Costs of obtaining station representation contracts are deferred and
amortized over the life of the new contract. Such amortization is included in
the accompanying consolidated statements of operations as a component of
depreciation and amortization expense. Amounts which are to be amortized during
the next year are included as current assets in the accompanying consolidated
balance sheets. Income earned from the sale of station representation contracts
(contract termination revenue) is recognized on the effective date of the
buyout agreement. In 2000 and 1999, contract termination revenue was offset by
$1,691 and $290, respectively, representing the write-off of unamortized
contract acquisition cost remaining which relates to the respective contracts
sold. No such offset existed in 2001.

  Cash and Cash Equivalents and Marketable Securities

    The Company considers cash in banks and investments with an original
maturity of three months or less to be cash equivalents. Marketable securities
consist of investments in debt securities with original maturities of less than
twelve months. During 2001, the Company liquidated its marketable equity
securities for book value.

                                      F-7

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


  Fixed Assets, net

    Furniture, fixtures and equipment are recorded at cost and are depreciated
over three to ten-year lives, and leasehold improvements are amortized over the
shorter of the lives of the leases or assets, all on a straight-line basis.

  Depreciation and Amortization Expense

    A summary of depreciation and amortization expense for the years ended
December 31, 2001, 2000, and 1999 is as follows:

<TABLE>
<CAPTION>
                                            2001    2000    1999
                                           ------- ------- -------
<S>                                        <C>     <C>     <C>
Depreciation of fixed assets.............. $ 1,818 $ 1,473 $ 1,484
Amortization of contract acquisition costs  30,553  22,852  28,291
Amortization of intangible assets.........   4,302   2,123   2,942
                                           ------- ------- -------
                                           $36,673 $26,448 $32,717
                                           ======= ======= =======
</TABLE>

    In 2001, amortization of contract acquisition costs includes the writeoff
of approximately $6 million of deferred contract acquisition costs related to
the Clear Channel settlement (see Note 11). Additionally, in 2001, amortization
of intangible assets includes a $2.4 million charge for goodwill impairment
(see below).

  Long-Lived Assets

    The excess of costs of purchased businesses over the fair value of assets
acquired is included in Other Assets on the accompanying consolidated balance
sheets. These costs are being amortized using the straight-line method over 5
years.

    In accordance with SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed of", recoverability
of intangible assets is assessed periodically and impairments, if any, are
recognized in operating results if a permanent diminution in value were to
occur based upon an undiscounted cash flow analysis. In 2001, the Company has
recorded impairment of goodwill on one of its investments of approximately $2.4
million.

  Employee Stock Ownership Plan

    The Company has an Employee Stock Ownership Plan ("ESOP") for eligible
employees. Cash contributions made by the Company to the ESOP are recorded as
compensation expense and stock repurchases made by the Company from the ESOP
are recorded in treasury stock. Any outstanding receivable to the Company from
the ESOP is recorded as a reduction to shareholders' equity and shares of the
Company's stock owned by the ESOP are treated as outstanding common stock.

  Restructuring Charges

    A strategic restructuring program was undertaken in 2001 in response to
difficult economic conditions and to further ensure the Company's competitive
position. In 2001, the accompanying

                                      F-8

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)

statement of operations includes restructuring charges of $3,471 which is
included in selling expenses. The restructuring charges are primarily comprised
of employee termination benefits. The restructuring program has resulted in the
termination of approximately 53 employees. The effect of the restructuring
charges is to increase basic loss per share by $0.40. At December 31, 2001, the
accompanying consolidated balance sheet includes accruals relating to the
restructuring program of $2,917, of which $2,175 is included in accrued
employee related liabilities and $742 is included in other noncurrent
liabilities.

  Loss per Share

    Basic loss per share for each of the respective years has been computed by
dividing the net loss applicable to common shareholders by the weighted average
number of common shares outstanding during the year which was 8,715,129,
9,306,826, and 6,182,191 for the years ended December 31, 2001, 2000, and 1999,
respectively. Diluted loss per share would reflect the potential dilution that
could occur if the outstanding options to purchase common stock were exercised.
For the years ended December 31, 2001, 2000, and 1999, the exercise of
outstanding options would have an antidilutive effect and therefore have been
excluded from the calculation.

  Income Taxes

    Income taxes are recognized during the year in which transactions enter
into the determination of financial statement income, with deferred taxes being
provided for temporary differences between amounts of assets and liabilities
recorded for tax and financial reporting purposes.

  Segment Reporting

    Statement of Financial Accounting Standards No. 131, "Disclosure about
Segments of an Enterprise and Related Information" requires the Company to
report segment financial information consistent with the presentation made to
the Company's management for decision making purposes. The Company is managed
as one segment and all revenues are derived solely from representation
operations and related activities. The Company's management decisions are based
on operating cash flow (defined as operating income before depreciation,
amortization, and management fees), general and administrative expenses of
$12,103, $11,321, and $10,779 in 2001, 2000, and 1999, respectively, and
adjusted EBITDA (operating income excluding contract termination revenue and
depreciation and amortization expense) of $3,421, $22,868, and $17,766, in
2001, 2000, and 1999, respectively.

  New Accounting Pronouncements

    Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities," was issued in June 1998 and was
subsequently amended by SFAS No. 138 issued in June 2000. These statements
require companies to record derivatives on the balance sheet as assets and
liabilities, measured at fair value. Depending on the use of a derivative and
whether it has been designated and qualifies as a hedge, gains or losses
resulting from changes in the value of the derivative would be recognized
currently in earnings or reported as a component of other comprehensive income.
These statements were effective for the Company beginning January 1, 2001.

                                      F-9

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)

The Company does not use derivative instruments and therefore the adoption of
these statements did not have any impact on its financial position or results
of operations.

    SFAS No. 142, "Goodwill and Other Intangible Assets," was issued in June
2001. This Statement addresses financial accounting and reporting for acquired
goodwill and other intangible assets and supersedes APB Opinion No. 17,
"Intangible Assets". It addresses how intangible assets acquired individually
or with a group of other assets (but not those acquired in a business
combination) should be accounted for in financial statements upon their
acquisition. This Statement also addresses how goodwill and other intangible
assets should be accounted for after they have been initially recognized in the
financial statements. With the adoption of this Statement, goodwill is no
longer subject to amortization over its estimated useful life. Rather, goodwill
will be subject to at least an annual assessment for impairment by applying a
fair-value-based test. Similarly, goodwill associated with equity method
investments is no longer amortized. Equity method goodwill is not, however,
subject to the new impairment rules. Effective January 1, 2002, the Company
will cease amortization of its existing goodwill. The Company is in the process
of assessing the impact of adopting the new impairment rules and may incur an
impairment charge in accordance with the adoption of this Statement.

    SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets," was issued in August 2001 and supercedes SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of". SFAS No. 144 requires that a single accounting model be applied to
long-lived assets whether such assets are held and used, are to be disposed of
other than by sale or disposed of by sale. The accounting model requires the
long-lived asset to be recorded at the lower of its carrying amount or its fair
value. The statement also broadens the presentation of discontinued operations
to include more disposal transactions. The Company adopted this statement on
January 1, 2002. The adoption of this statement is not expected to have a
material impact on the Company's consolidated financial statements.

  Use of Estimates

    The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

2.   Acquisitions and Investments

    In December 2000, the Company invested $3 million in Cybereps, Inc.
increasing its ownership percentage from 16% to 51%. The Company retroactively
accounted for the investment using the equity method of accounting and for the
years ended December 31, 2001 and 2000, has recorded an equity loss on the
investment of $1,561 and $378, respectively. In October 2001, the Company
assumed effective control of Cybereps' operations and has consolidated its
operations from that date. The operating loss included in the accompanying
statement of operations from the date of

                                     F-10

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)

consolidation through December 31, 2001 is approximately $325. In addition, the
Company has written off approximately $2.4 million of goodwill derived from its
initial investments in Cybereps.

    In September 1999, the Company acquired substantially all of the assets of
Morrison and Abraham, Inc., a promotion and marketing consulting service to the
radio broadcasting industry, for approximately $1 million paid upon closing and
a maximum of $3 million to be paid contingent upon certain future performance
measures over the next five years. The performance measures were met for the
years ended December 31, 2000 and 1999 and therefore, the Company has paid an
additional $1.5 million to date. The performance measures were not met for the
year ended December 31, 2001. The acquisition has been accounted for by the
purchase method; accordingly, operating results are included in the
accompanying statements of operations from the date of purchase. The acquired
assets include fixed assets, current assets and rights to certain service
agreements. The excess of cost over the fair market value of the assets
acquired is being amortized over a five year period.

    The Company has investments in affiliates, which are accounted for using
the cost method of accounting as the Company does not have the ability to
exercise significant influence over operating and financial policies of these
affiliates. During 2001, the Company recorded a write down of $1.9 million to
reflect these investments at their net realizable value. This charge is
included in loss on investments in the accompanying statement of operations.
The total carrying value of these investments was $2.6 million and $4.1 million
as of December 31, 2001 and 2000, respectively, representing a range of
ownership from 8% to 16% of the affiliated companies.

3.   Fixed Assets

    Fixed assets are comprised of the following:

<TABLE>
<CAPTION>
                                                         December 31,
                                                      ------------------
                                                        2001      2000
                                                      --------  --------
      <S>                                             <C>       <C>
      Furniture and equipment........................ $ 15,448  $ 14,767
      Leasehold improvements.........................    6,133     6,133
      Equipment held under lease.....................    3,461     3,461
                                                      --------  --------
                                                        25,042    24,361
      Less--Accumulated depreciation and amortization  (21,133)  (19,315)
                                                      --------  --------
      Fixed assets, net.............................. $  3,909  $  5,046
                                                      ========  ========
</TABLE>

4.   Accounts Payable

    The Company utilizes a cash management system whereby overnight investments
are determined daily. Included in accounts payable are $7,941 and $9,800 of
book overdrafts as of December 31, 2001
and 2000, respectively, which result from this cash management program.

                                     F-11

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


5.  Employee Stock Plans

  Employee Stock Ownership Plan

    Under the terms of the Company's nonleveraged Employee Stock Ownership Plan
("ESOP") and Trust ("ESOT"), the Company may make annual contributions to the
ESOT in the form of either cash or Class B common stock of the Company for the
benefit of eligible employees. In lieu of contributions, the Company may
repurchase shares of Class B common stock from the ESOP or advance money to the
plan from time to time. The amount of annual funding is at the discretion of
the Board of Directors of the Company except that the minimum amount must be
sufficient to enable the ESOT to meet its current obligations. No cash
contributions were made by the Company in 2001, 2000, and 1999 and consequently
no compensation cost was incurred during 2001, 2000, or 1999.

    Pursuant to the ESOP, as amended, employees of the Company and each of its
subsidiaries are eligible to participate, subject to certain uniform
requirements. Upon leaving the Company, employees may sell the shares back to
the ESOT at the then fair market value of the Company's Class B common stock.
Prior to the initial public offering (see Note 9), distributions were made in
quarterly installments over a period not to exceed five years, depending upon
the former employee's total account balance. Effective with the initial public
offering, the distribution rule was amended to lump sum distribution.

    As of December 31, 2001 and 2000, the Company's ESOP owned 1,403,869 and
1,561,454 Class B common shares, respectively, representing approximately 15.2%
and 18.3%, respectively, of the Company's total shares outstanding, before
consideration of common stock equivalents. During 2001, the ESOP transferred
119,576 shares to the Company's 401(k) Plan (see Note 6). All shares owned by
the ESOP as of December 31, 2001 and 2000 were allocated and earned.

  Stock Growth Plan

    On January 1, 1995, the Company established the Stock Growth Plan, a
qualified stock bonus plan through which a portion of qualified employee
compensation is allocated to the plan. Participation in the Stock Growth Plan
is mandatory and non-contributory for all eligible employees. Stock Growth Plan
participants are at all times fully vested in their accounts without regard to
age or years of service. The Company, through employee withholdings, makes
regular monthly cash contributions to the Stock Growth Plan. For the years
ended December 31, 2001, 2000, and 1999, the Company recorded compensation
expense of $2,708, $2,949, and $2,672, respectively in relation to these
contributions. Contributions to the Stock Growth Plan are used to repurchase
shares of Interep Class B common stock from the ESOP and shares held by
terminated employees. As of December 31, 2000, the Company had a contribution
accrual of $695 due to the Stock Growth Plan. No accrual was required as of
December 31, 2001.

    During 2001, the Company issued 680,330 shares of Class B common stock to
the Interep Stock Growth Plan for net cash proceeds of $2.8 million. The shares
were issued at the current fair market value on the date of issuance. During
2001 and 2000, the Stock Growth Plan purchased 13,000 and 103,000 shares,
respectively, on the open market at a weighted average fair value of $3.63 and
$5.76,

                                     F-12

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)

respectively. As of December 31, 2001 and 2000, the Stock Growth Plan owned
2,269,103 and 1,775,951 Class B common shares, respectively, and 104,112 and
100,592 of Class A common shares, respectively, representing approximately
25.7% and 21.9%, respectively, of the Company's total shares outstanding,
before consideration of common stock equivalents. Shares owned by the Stock
Growth Plan are recorded as outstanding stock of the Company. Distributions to
participants are made in cash upon termination of employment over a period not
to exceed three years.

  Stock Options

    In 1999, the Company adopted the 1999 Stock Incentive Plan. The plan
provides for the granting of options and appreciation rights of the Company's
Class A and Class B common stock. The option price per share may not be less
than the fair market value of the Class A and Class B common stock on the date
the option is granted. The aggregate number of shares may not exceed 666,667
for any participant during any three consecutive 12 month periods, and the
maximum term of an option may not exceed ten years. Options primarily vest in
three equal annual installments. Under the terms of the plan, the Company is
authorized to grant options to purchase up to a total of 2,000,000 shares of
Class A and Class B common stock.

    A summary of the stock options outstanding during the years ended December
31, 2001, 2000, and 1999 is set forth below:

<TABLE>
<CAPTION>
                                                                 Weighted
                                                                 Average
                                                      Number of  Exercise
                                                       Shares     Price
                                                      ---------  --------
       <S>                                            <C>        <C>
       Outstanding at December 31, 1999 and 1998..... 4,231,439   $3.77
       Granted during 2000, repriced in 2000.........   775,300    2.81
                                                      ---------   -----
       Outstanding at December 31, 2000.............. 5,006,739    3.62
       Exercised during 2001.........................   (26,500)   2.81
       Forfeited during 2001.........................   (87,150)   2.81
                                                      ---------   -----
       Outstanding at December 31, 2001.............. 4,893,089   $3.64
       Options exercisable at December 31, 2000...... 4,485,000    3.72
       Options exercisable at December 31, 2001...... 4,649,326    3.69
</TABLE>

                                     F-13

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


    The following table summarizes information regarding the stock options
outstanding at December 31, 2001, pursuant to the terms of the Plan:

<TABLE>
<CAPTION>
                           At                   Remaining
                      December 31,    Exercise Contractual
                          2001         Price      Life
                      ------------    -------- -----------
                      <S>             <C>      <C>
                         208,960       $1.56    4 Years
                         313,440        2.77    4 Years
                         417,920        3.91    4 Years
                         835,839        3.80    6.5 Years
                       1,985,119        4.02    6.5 Years
                         470,161        4.20    7 Years
                         661,650        2.81    8.5 Years
                         -----
                       4,893,089
                       =========
</TABLE>

    In April 2000, the Company granted options to purchase 775,300 shares of
Class A common stock at an exercise price of $8.77. In December 2000, the
Company repriced these options to an exercise price of $2.81 which represented
the fair market value on the date of the repricing. In accordance with
generally accepted accounting principles, the Company has adopted variable plan
accounting for these options from the date of the repricing and has recorded
compensation expense of $715 and $535 for the years ended December 31, 2001 and
2000, respectively.

    The Company has adopted the disclosure provisions of FASB Statement No.
123, but opted to remain under the expense recognition provisions of Accounting
Principles Board (APB) Opinion No. 25, in accounting for stock option plans.
Had compensation expense for stock options granted under the Plan been
determined based on fair value at the grant dates consistent with the
disclosure method required in accordance with FASB Statement No. 123, the
Company's net loss and loss per share would have been affected as shown in the
following pro forma presentation:

<TABLE>
<CAPTION>
                                            Year ended December 31,
                                          ---------------------------
                                            2001     2000      1999
                                          --------  -------  --------
         <S>                              <C>       <C>      <C>
         Net loss........................
             As reported................. $(19,855) $(2,905) $(12,178)
             Pro forma...................  (20,792)  (3,877)  (16,756)
         Basic and diluted loss per share
             As reported................. $  (2.28) $ (0.31) $  (1.97)
             Pro forma................... $  (2.38)   (0.42)    (2.71)
</TABLE>

    The weighted average fair value of options granted in 2000 of $5.94 was
estimated as of the date of grant using the Black-Scholes stock option pricing
model, based on the following weighted average assumptions: weighted average
risk free interest rate of 6.41%, dividend yield of 0%, volatility of 81.6%,
and expected term of 10 years.

                                     F-14

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


6.  Employee Benefit Plans

  Managers' Incentive Compensation Plans

    The Company maintains various managers' incentive compensation plans for
substantially all managerial employees. The plans provide for incentives to be
earned based on attainment of threshold operating profit and market share goals
established each year, as defined. The Company provided approximately $562,
$4,289, and $5,029 for such compensation during 2001, 2000, and 1999,
respectively.

  401(k) Plan

    The Company has a defined contribution plan, the 401(k) Plan, which covers
substantially all employees who have completed ninety days of service with the
Company. Under the terms of the 401(k) Plan, the Company may contribute a
matching contribution percentage determined by, and at the discretion of, the
Board of Directors but not in excess of the maximum amount deductible for
federal income tax purposes. Company contributions vest to the employees at 20%
per year over a five-year period. The Company provided $761, $837, and $615 in
the form of cash in 2001, 2000, and 1999, respectively.

  Deferred Compensation Plans

    Certain of Interep's subsidiaries maintain deferred compensation plans
which cover employees selected at the discretion of management. Participants
are entitled to deferred compensation and other benefits under these plans. In
2001, 2000, and 1999, the Company provided compensation expense of $96, $109,
and $101, respectively related to these plans. Amounts due under these plans of
$3.1 million were fully vested as of December 31, 2001 and are recorded as
accrued expenses ($0.6 million) and other noncurrent liabilities ($2.5 million)
on the Company's consolidated balance sheets; however, they remain subject to
further appreciation/ depreciation upon changes in value (as defined).

    The Company has agreements with several of its employees to provide
supplemental income benefits. The benefits under these plans were fully vested
as of December 31, 2001. The Company provided $184, $164, and $189 in 2001,
2000, and 1999, respectively, for these plans which principally represented
interest on the vested benefits.

  Other

    The Company has life insurance policies on certain of its executives for
which Interep is the beneficiary. Proceeds from these policies will be used to
partially fund certain of the retirement benefits under these supplemental
agreements. Such policies had cash surrender values of $1,609 and $1,473 as of
December 31, 2001 and 2000, respectively, and offsetting loans of $1,105 and
$958, respectively, which is included in Investments and Other Assets on the
accompanying consolidated balance sheets.

                                     F-15

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


7.  Income Taxes

    Interep and its subsidiaries file a consolidated federal tax return.
However, for state tax purposes, separate tax returns are filed in various
jurisdictions where losses on certain subsidiaries are not available to offset
income on other subsidiaries, and tax benefits on such losses may not be
realized. As a result, the consolidated tax provisions are determined
considering this tax reporting structure and may not fluctuate directly with
consolidated pretax income.

    Components of the provisions for income taxes are as follows:

<TABLE>
<CAPTION>
                                      Year Ended December 31,
                                     -------------------------
                                      2001     2000     1999
                                     -------  -------  -------
                 <S>                 <C>      <C>      <C>
                 Current:
                     Federal........ $    --  $    --  $    --
                     State..........     535      197       --
                 Deferred...........  (5,021)  (1,875)  (6,148)
                                     -------  -------  -------
                     Total benefit.. $(4,486) $(1,678) $(6,148)
                                     =======  =======  =======
</TABLE>

    A reconciliation of the U.S. federal statutory tax rate to the effective
tax rate on the loss before income taxes for the periods ended December 31,
2001, 2000, and 1999, is as follows:

<TABLE>
<CAPTION>
                                                          2001     2000     1999
                                                         -------  -------  -------
<S>                                                      <C>      <C>      <C>
Benefit computed at the federal statutory rate of 34%... $(8,276) $(1,558) $(6,231)
State and local taxes, net of federal income tax benefit  (1,044)    (197)    (946)
Change in valuation allowance and other adjustments.....   4,395     (436)     772
Nondeductible travel and entertainment expense..........     167      256      204
Nondeductible insurance premiums........................     119      257       53
Nondeductible investment loss...........................     153       --       --
                                                         -------  -------  -------
   Total................................................ $(4,486) $(1,678) $(6,148)
                                                         =======  =======  =======
</TABLE>

                                     F-16

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


    Temporary differences and carryforwards which gave rise to deferred tax
assets and liabilities at December 31, 2001 and 2000, are as follows:

<TABLE>
<CAPTION>
                                                           December 31,
                                                         ----------------
                                                          2001     2000
      -                                                  -------  -------
      <S>                                                <C>      <C>
      Deferred tax assets:
      Depreciation and amortization..................... $ 4,582  $ 2,439
      Accruals not currently deductible for tax purposes   2,721    2,376
      Consolidated net operating loss carryforward......  16,157    8,314
      Other.............................................   2,277    1,086
                                                         -------  -------
                                                          25,737   14,215
                                                         -------  -------
      Deferred tax liabilities:
      Buyout receivable.................................   4,898    4,786
      Unamortized representation contracts..............   9,159    7,254
      Other.............................................     755      300
                                                         -------  -------
      Net deferred tax asset............................  10,925    1,875
      Valuation allowance...............................  (4,029)      --
                                                         -------  -------
      Net deferred tax asset............................ $ 6,896  $ 1,875
                                                         =======  =======
</TABLE>

    The net deferred tax asset as of December 31, 2001 and 2000 is included in
Investments and Other Assets on the accompanying consolidated balance sheets.
As of December 31, 2001 and 2000, the Company had an accrued tax liability of
$172 and $143, respectively, on its books. The Company has a tax net operating
loss of $40,393 as of December 31, 2001 that expires in 2018 through 2021.

8.  Long-Term Debt

    Long-term debt at December 31, 2001 and 2000 was comprised of $99,000 in
10.0% Senior Subordinated notes due July 1, 2008 (the "Notes").

    The Notes are general unsecured obligations of the Company, and the
indenture agreement for the Notes stipulates, among other things, restrictions
on incurrence of additional indebtedness, payment of dividends, repurchase of
equity interests (as defined), creation of liens (as defined), transactions
with affiliates (as defined), sale of assets or certain mergers and
consolidations. The Notes bear interest at the rate of 10.0% per annum, payable
semiannually on January 1 and July 1. The Notes are subject to redemption at
the option of the Company, in whole or in part, at any time after July 1, 2003.
All of the Company's subsidiaries are guarantors of these Notes and all
guarantor subsidiaries are wholly owned by the Company. The guarantee is full,
unconditional, joint and several with other guarantor subsidiaries. The Company
has no other assets or operations separate from its investment in the

                                     F-17

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)

subsidiaries. In July 2000, the Company repurchased $1 million in principal of
the Notes in an open market transaction.

    The Company capitalized $4,689 of costs incurred in the offering of the
Notes which is being amortized over the ten year life of the Notes.

9.  Shareholders' Equity

    In December 1999, the Company completed an initial public offering of
5,416,667 shares of Class A common stock at an initial offering price of $12.00
per share. Of the 5,416,667 shares of Class A common stock offered, 4,429,167
shares were issued and sold by the Company and 987,500 were sold by the
Company's ESOP. The net proceeds to the Company from the initial public
offering, after deducting applicable underwriter discounts and offering
expenses, was $46.8 million. In January 2000, an additional 812,500 shares of
common stock were sold by the Company's ESOP pursuant to an underwriters'
over-allotment provision.

    On November 5, 1999, the board of directors approved a stock split of
20.8959855 for every one share outstanding to the stockholders of record as of
December 8, 1999. The stock split was effected prior to the initial public
offering. The stockholders also approved an increase in the authorized Class B
common stock to 10,000,000 shares and a decrease in its par value to $0.01 as
well as the authorization of 20,000,000 shares of Class A common stock. All
share and per share data have been retroactively restated to reflect these
changes.

    During 2000, the Board of Directors of the Company authorized a program to
repurchase up to 2,000,000 shares of its Class A common stock in open market
transactions. As of December 31, 2000, 1,825,000 shares had been repurchased
and retired under this program for an aggregate cost of $10,546.

    During 2001 and 2000, primarily in connection with employee terminations,
267,353 and 209,976 shares of Class B common stock were converted into Class A
common stock.

10.  Related Party Transactions

    Since December 1979, the Company has leased from a trust, of which one of
its executives is an income beneficiary and one of its executives is the
trustee, a building which is used by the Company for training sessions and
management meetings. The current lease expires on December 31, 2009 and
provides for a base annual rental which is adjusted each year to reflect
inflation and actual usage. Total lease expense was $78, $78, and $74 in 2001,
2000, and 1999, respectively.

    In 1999, the Company acquired Interep Interactive, an internet
representation firm, from one of its executives for $50 and a warrant to
acquire 20% of this subsidiary for $30 expiring in 2025.

    As of December 31, 2000, an executive was indebted to the Company in the
total amount of $150 by execution of a promissory note payable to the Company
bearing interest at a fluctuating rate equal to the prime commercial lending
rate plus 1%. No amount was outstanding as of December 31, 2001.

                                     F-18

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


    Since 1997, the Company has had an agreement with Media Financial Services,
Inc., an affiliate of one of the Company's executives, whereby Media Financial
Services provides financial and accounting services to the Company. The fee for
these services amounted to approximately $3,200, $3,000, and $2,800 in 2001,
2000, and 1999, respectively.

    The Company believes the terms of the arrangements relating to the building
rental, indebtedness and accounting services are at least comparable to, if not
more favorable for the Company, than the terms which would have been obtained
in transactions with unrelated parties.

11.  Commitments and Contingencies

    At December 31, 2001, the Company was committed under operating leases,
principally for office space, which expire at various dates through 2009.
Certain leases are subject to rent reviews and require payment of expenses
under escalation clauses. Rent expense was $5,100, $4,937, and $4,613 in 2001,
2000, and 1999, respectively. The noncash portion of rent expense was $271,
$254, and $222 for 2001, 2000, and 1999, respectively. Future minimum rental
commitments under noncancellable leases are as follows:

<TABLE>
                               <S>        <C>
                               2002...... $4,377
                               2003......  4,131
                               2004......  4,081
                               2005......  2,260
                               2006......  1,394
                               Thereafter  2,419
</TABLE>

    The Company has representation contract buyouts payable due over the next
five years, as follows:

<TABLE>
                               <S>        <C>
                               2002...... $33,161
                               2003......   8,773
                               2004......   5,856
                               2005......   3,916
                               2006......   1,266
                               Thereafter   1,456
</TABLE>

    The Company has employment agreements with certain of its officers and
employees for terms ranging from three to six years with annual compensation
aggregating approximately $1,600. These agreements include escalation clauses
(as defined) and provide for certain additional bonus and incentive
compensation.

    The Company may be involved in various legal actions from time to time
arising in the normal course of business. In the opinion of management, there
are no matters outstanding that would have a material adverse effect on the
consolidated financial position or results of operations of the Company.

                                     F-19

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


    In 2000, certain clients of the Company were served summons and complaints
(on separate matters) for alleged breaches of various national sales
representation agreements. The Company has agreed to indemnify its clients from
and against any loss, liability, cost or expense incurred in the actions. In
2002, the Company entered into an agreement in principle regarding these
contract acquisition claims. The settlement will result in the offset of
approximately $12 million in representation contract buyouts receivable and
payable as well as additional contract termination revenue of $2.4 million. In
addition, the settlement includes payment schedules for approximately $10
million in contract representation accounts payable that have been previously
recorded, and which are reflected in the table above.

    In December 1999, the Company's representation agreement with Clear Channel
was terminated. In April 2000, the Company filed an action in the Supreme Court
of the State of New York seeking damages arising out of Clear Channel's alleged
breach of contract of its national sales representation agreement with the
Company. As of December 31, 2000, the Company had $6.6 million of current
deferred costs on representation contract purchases and $9.4 million of current
representation contract buyouts payable resulting from the purchase of the
Clear Channel representation agreement in 1996. In May 2001, the Company
entered into a settlement agreement with Clear Channel. The settlement
agreement resulted in a cash payment to the Company as well as the forgiveness
of the remaining payables which combined resulted in approximately $18.1 of
contract termination revenue in the accompanying statement of operations. In
addition, the Company wrote off the remaining current deferred representation
contract costs through amortization expense (see Note 1).

12.  Supplemental Information

    Interest expense is shown net of interest income of $763, $2,671, and $693
in 2001, 2000, and 1999, respectively.

    One broadcast group contributed approximately 28%, 29% and 29% of the
Company's total revenues in 2001, 2000 and 1999, respectively. No other client
group contributed revenues in excess of 10% in 2001, 2000, and 1999.

    In 2001 and 2000, contract buyout receivables from one group of radio rep
firms represented $12,244 and $11,980, respectively, of the Company's total
contract buyout receivables.

                                     F-20

<PAGE>

                      INTEREP NATIONAL RADIO SALES, INC.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                    (in thousands except share information)


13.  The Fair Value of Financial Instruments

    The following disclosure of the estimated fair value of financial
instruments is made in accordance with the requirements of SFAS No. 107,
"Disclosures about Fair Value of Financial Instruments." The estimated fair
value amounts have been determined by the Company using available market
information. However, considerable judgment is required in interpreting market
data to develop the estimates of fair value. Accordingly, the estimates
presented herein are not necessarily indicative of the amounts that the Company
could realize in a current market exchange. The use of different market
assumptions and/or estimation methodologies may have a material effect on the
estimated fair value amounts.

<TABLE>
<CAPTION>
                                          December 31
                            ---------------------------------------
                                   2001                2000
             -              ------------------- -------------------
                            Carrying Estimated  Carrying Estimated
                             Amount  Fair Value  Amount  Fair Value
             -              -------- ---------- -------- ----------
             <S>            <C>      <C>        <C>      <C>
             Long-term debt $99,000   $64,350   $99,000   $74,250
</TABLE>

    The fair value of cash and cash equivalents, accounts receivables and
accounts payables approximate the carrying amount due to the short maturity of
those instruments.

14.  Quarterly Financial Information (Unaudited)

<TABLE>
<CAPTION>
2001 Quarter Ended                March 31 June 30 September 30 December 31 2001 Year
------------------                -------- ------- ------------ ----------- ---------
<S>                               <C>      <C>     <C>          <C>         <C>
Commission revenues.............. $16,608  $22,650   $21,641     $ 20,229   $ 81,128
Contract termination revenue (1).      69   20,240       661          461     21,431
                                  -------  -------   -------     --------   --------
   Total Revenues................  16,677   42,890    22,302       20,690    102,559
Operating expenses...............  24,651   34,178    22,867       32,684    114,380
Operating income (loss)..........  (7,974)   8,712      (565)     (11,994)   (11,821)
Net income (loss)................  (6,305)   1,236    (5,490)      (9,296)   (19,855)
Basic earnings (loss) per share.. $ (0.74) $  0.15   $ (0.62)    $  (1.03)  $  (2.28)
Diluted earnings (loss) per share $ (0.74) $  0.12   $ (0.62)    $  (1.03)  $  (2.28)
</TABLE>
--------
(1) Settlement of Clear Channel litigation occurred in second quarter 2001
    resulting in contract termination revenue of $18 million.

<TABLE>
<CAPTION>
2000 Quarter Ended                March 31 June 30  September 30 December 31   Year
------------------                -------- -------  ------------ ----------- --------
<S>                               <C>      <C>      <C>          <C>         <C>
Commission revenues.............. $20,106  $26,888    $27,186      $26,419   $100,599
Contract termination revenue.....     810        7      1,529        4,825      7,171
                                  -------  -------    -------      -------   --------
   Total Revenues................  20,916   26,895     28,715       31,244    107,770
Operating expenses...............  24,063   26,980     27,509       25,627    104,179
Operating (loss) income..........  (3,147)     (85)     1,206        5,617      3,591
Net (loss) income................  (2,936)  (1,338)      (694)       2,063     (2,905)
Basic earnings (loss) per share.. $ (0.28) $ (0.14)   $ (0.08)     $  0.24   $  (0.31)
Diluted earnings (loss) per share $ (0.28) $ (0.14)   $ (0.08)     $  0.23   $  (0.31)
</TABLE>

                                     F-21

<PAGE>

                                                                    Schedule II

                      INTEREP NATIONAL RADIO SALES, INC.

                       VALUATION AND QUALIFYING ACCOUNTS
                                (in thousands)

<TABLE>
<CAPTION>
                                                        Additions
                                            Balance at  charged to
                                           beginning of costs and             Balance at
                                               year      expenses  Deductions end of year
                                           ------------ ---------- ---------- -----------
<S>                                        <C>          <C>        <C>        <C>
December 31, 1999
Allowance for Doubtful Accounts...........    $1,626      1,534      (1,002)    $2,158
Valuation Allowance on Deferred Tax Assets    $   --      1,052          --     $1,052
December 31, 2000
Allowance for Doubtful Accounts...........    $2,158        325        (543)    $1,940
Valuation Allowance on Deferred Tax Assets    $1,052         --      (1,052)    $   --
December 31, 2001
Allowance for Doubtful Accounts...........    $1,940        404        (597)    $1,747
Valuation Allowance on Deferred Tax Assets    $   --      4,029          --     $4,029
</TABLE>

                                     F-22

<PAGE>

                                  SIGNATURES

    Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized in the City of New
York, State of New York.

April 1, 2002

<TABLE>
                                               <C>  <S>
                                               INTEREP NATIONAL RADIO SALES, INC.

                                               By:       /S/  RALPH C. GUILD
                                                    -----------------------------
                                                           Ralph C. Guild
                                                    President and Chief Executive
                                                     Officer and Chairman of the
                                                     Board (principal executive
                                                              officer)
</TABLE>

    Each person whose signature appears below hereby appoints Ralph C. Guild
and William J. McEntee, Jr., and both of them, either of whom may act without
the joinder of the other, as his true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments to
this Annual Report on Form 10-K, and to file the same, with all exhibits
thereto and all other documents in connection therewith, with the Commission,
granting unto said attorneys-in-fact and agents full power and authority to
perform each and every act and thing appropriate or necessary to be done, as
fully and for all intents and purposes as he might or could do in person,
hereby ratifying and confirming all that said attorneys-in-fact and agents or
their substitute or substitutes may lawfully do or cause to be done by virtue
hereof.

    Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

     /S/  RALPH C. GUILD      President, Chief Executive    April 1, 2002
----------------------------- Officer, Chairman of the
       Ralph C. Guild         Board and Director

     /S/  MARC G. GUILD                                     April 1, 2002
----------------------------- President, Marketing
        Marc G. Guild         Division; Director

/S/  WILLIAM J. MCENTEE, JR.  Vice President and Chief      April 1, 2002
----------------------------- Financial Officer (Principal
   William J. McEntee, Jr.    Financial and Accounting
                              Officer)

  /S/   LESLIE D. GOLDBERG    Director                      April 1, 2002
-----------------------------
     Leslie D. Goldberg

   /s/  HOWARD M. BRENNER     Director                      April 1, 2002
-----------------------------
      Howard M. Brenner

      /s/  JOHN PALMER        Director                      April 1, 2002
-----------------------------
         John Palmer

      /S/  ARNIE SEMSKY       Director                      April 1, 2002
-----------------------------
        Arnie Semsky