##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2008.
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934.
 For or the transition period from                    to
 Commission file number 000-24525
 CUMULUS MEDIA INC.
 (Exact Name of Registrant as Specified in Its Charter)
 Delaware
    
    36-4159663(State or Other Jurisdiction of 
Incorporation or Organization)
    
    (I.R.S. Employer
Identification No.)3280 Peachtree Road, NW Suite 2300, Atlanta, GA
    
    30305(Address of Principal Executive Offices)
    
    (ZIP Code)
 (404) 949-0700
 þ o
  Large accelerated filer oAccelerated filer þNon-accelerated filer o(Do not check if a smaller reporting company)Smaller reporting company o o þ




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##### 



CUMULUS MEDIA INC.
 INDEX
 PART I. FINANCIAL INFORMATION
    
    
    3Item 1. Financial Statements (Unaudited)
    
    
    3Condensed Consolidated Balance Sheets as of June 30, 2008 and December 31, 2007
    
    
    3Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2008 and 2007
    
    
    4Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2008 and 2007
    
    
    5Notes to Condensed Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    14Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    22Item 4. Controls and Procedures
    
    
    22PART II. OTHER INFORMATION
    
    
    22Item 1. Legal Proceedings
    
    
    22Item 1A. Risk Factors
    
    
    23Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    23Item 3. Defaults Upon Senior Securities
    
    
    23Item 4. Submission of Matters to a Vote of Security Holders
    
    
    23Item 5. Other Information
    
    
    23Item 6. Exhibits
    
    
    24Signatures
    
    
    25Exhibit Index
    
    
    26EX-3.1 AMENDED & RESTATED BYLAWSEX-31.1 SECTION 302 CERTIFICATION OF CEOEX-31.2 SECTION 302 CERTIFICATION OF CFOEX-32.1 SECTION 906 CERTIFICATION OF CEO & CFO
  2




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PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 
 CUMULUS MEDIA INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except for share and per share data)
(Unaudited)
 June 30,
    
    
    December 31,2008
    
    
    2007AssetsCurrent assets:Cash and cash equivalents
    
    $
    52,195
    
    
    $
    32,286Accounts receivable, less allowance for doubtful accounts of $2,058 and
$1,839, in 2008 and 2007, respectively
    
    
    53,573
    
    
    
    52,496Prepaid expenses and other current assets
    
    
    5,231
    
    
    
    5,835Total current assets
    
    
    110,999
    
    
    
    90,617Property and equipment, net
    
    
    59,282
    
    
    
    61,735Intangible assets, net
    
    
    784,656
    
    
    
    783,638Goodwill
    
    
    98,300
    
    
    
    98,300Investment in affiliate
    
    
    23,656
    
    
    
    22,252Other assets
    
    
    4,237
    
    
    
    4,000Total assets
    
    $
    1,081,130
    
    
    $
    1,060,542Liabilities and Stockholders EquityCurrent liabilities:Accounts payable and accrued expenses
    
    $
    20,171
    
    
    $
    23,916Other
current liabilities
    
    
    7,256
    
    
    
    Current portion of long-term debt
    
    
    7,400
    
    
    
    13,490Total current liabilities
    
    
    34,827
    
    
    
    37,406Long-term debt
    
    
    720,960
    
    
    
    722,810Other liabilities
    
    
    12,921
    
    
    
    18,158Deferred income taxes
    
    
    167,257
    
    
    
    162,890Total liabilities
    
    
    935,965
    
    
    
    941,264Stockholders equity:Preferred stock, 20,262,000 shares authorized, par value $0.01 per share,
including: 250,000 shares designated as 13 3/4% Series A Cumulative
Exchangeable Redeemable Preferred Stock due 2009, stated value $1,000 per
share, 0 shares issued and outstanding in both 2008 and 2007 and 12,000 shares
designated as 12% Series B Cumulative Preferred Stock, stated value $10,000
per share, 0 shares issued and outstanding in both 2008 and 2007
    
    
    
    
    
    
    Class A common stock, par value $.01 per share; 100,000,000 shares
authorized; 59,572,592 and 59,468,086 shares issued, 37,351,688 and
37,101,154 shares outstanding, in 2008 and 2007, respectively
    
    
    596
    
    
    
    595Class B common stock, par value $.01 per share; 20,000,000 shares authorized;
5,809,191 shares issued and outstanding in both 2008 and 2007
    
    
    58
    
    
    
    58Class C common stock, par value $.01 per share; 30,000,000 shares authorized;
644,871 shares issued and outstanding in both 2008 and 2007
    
    
    6
    
    
    
    6Class A Treasury stock, at cost, 22,220,904 and 22,366,932 shares in 2008 and
2007, respectively
    
    
    (263,037
    )
    
    
    (267,084
    )Accumulated other comprehensive income
    
    
    2,814
    
    
    
    4,800Additional paid-in-capital
    
    
    969,043
    
    
    
    971,267Accumulated deficit
    
    
    (564,315
    )
    
    
    (590,364
    )Total stockholders equity
    
    
    145,165
    
    
    
    119,278Total liabilities and stockholders equity
    
    $
    1,081,130
    
    
    $
    1,060,542
 See accompanying notes to condensed consolidated financial statements.
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CUMULUS MEDIA INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except for share and per share data)
(Unaudited)
 Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Broadcast revenues
    
    $
    82,628
    
    
    $
    86,338
    
    
    $
    154,527
    
    
    $
    157,739Management fee from affiliate
    
    
    1,000
    
    
    
    1,000
    
    
    
    2,000
    
    
    
    2,000Net revenues
    
    
    83,628
    
    
    
    87,338
    
    
    
    156,527
    
    
    
    159,739Operating expenses:Station operating expenses (excluding depreciation,
amortization and LMA fees)
    
    
    52,975
    
    
    
    53,581
    
    
    
    104,124
    
    
    
    105,228Depreciation and amortization
    
    
    3,311
    
    
    
    3,690
    
    
    
    6,421
    
    
    
    7,560LMA fees
    
    
    320
    
    
    
    165
    
    
    
    500
    
    
    
    331Corporate general and administrative (including non-
cash stock compensation of $845, $2,007, $2,867 and
$4,349, respectively)
    
    
    4,094
    
    
    
    6,052
    
    
    
    9,555
    
    
    
    12,780Cost
associated with terminated transaction
    
    
    1,753
    
    
    
    
    
    
    
    1,893
    
    
    
    Total operating expenses
    
    
    62,453
    
    
    
    63,488
    
    
    
    122,493
    
    
    
    125,899Operating income
    
    
    21,175
    
    
    
    23,850
    
    
    
    34,034
    
    
    
    33,840Non-operating income (expense):Interest expense
    
    
    298
    
    
    
    (10,563
    )
    
    
    (20,562
    )
    
    
    (25,191
    )Interest income
    
    
    283
    
    
    
    106
    
    
    
    611
    
    
    
    190Loss on early extinguishment of debt
    
    
    
    
    
    
    (986
    )
    
    
    
    
    
    
    (986
    )Terminated
transaction fee
    
    
    15,000
    
    
    
    
    
    
    
    15,000
    
    
    
    Other income (expense), net
    
    
    (25
    )
    
    
    (142
    )
    
    
    (7
    )
    
    
    (171
    )Total nonoperating income (expense), net
    
    
    15,556
    
    
    
    (11,585
    )
    
    
    (4,958
    )
    
    
    (26,158
    )Income before income taxes and equity in net
income of affiliate
    
    
    36,731
    
    
    
    12,265
    
    
    
    29,076
    
    
    
    7,682Income tax expense
    
    
    (8,094
    )
    
    
    (8,987
    )
    
    
    (4,431
    )
    
    
    (5,400
    )Equity in net income (loss) of affiliate
    
    
    1,652
    
    
    
    (739
    )
    
    
    1,404
    
    
    
    (1,557
    )Net income
    
    $
    30,289
    
    
    $
    2,539
    
    
    $
    26,049
    
    
    $
    725Basic and diluted income per common share:Basic income per common share
    
    $
    0.70
    
    
    $
    0.06
    
    
    $
    0.60
    
    
    $
    0.02Diluted income per common share
    
    $
    0.70
    
    
    $
    0.06
    
    
    $
    0.60
    
    
    $
    0.02Weighted average basic common shares outstanding
    
    
    43,076,642
    
    
    
    43,598,061
    
    
    
    43,061,682
    
    
    
    43,403,453Weighted average diluted common shares outstanding
    
    
    43,095,223
    
    
    
    44,218,656
    
    
    
    43,083,770
    
    
    
    44,048,362
 See accompanying notes to condensed consolidated financial statements.
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CUMULUS MEDIA INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
 Six Months EndedJune 30,2008
    
    
    2007Cash flows from operating activities:Net income
    
    $
    26,049
    
    
    $
    725Adjustments to reconcile net income to net cash provided by operating activities:Write-off of debt issue costs
    
    
    
    
    
    
    986Depreciation
    
    
    6,416
    
    
    
    7,555Amortization of intangible assets
    
    
    5
    
    
    
    5Amortization of derivative gain
    
    
    (1,986
    )
    
    
    Amortization
of debt issuance costs
    
    
    209
    
    
    
    209Provision for doubtful accounts
    
    
    1,801
    
    
    
    1,467Gain on sale of assets or stations
    
    
    (5
    )
    
    
    Adjustment of the fair value of derivative instruments
    
    
    2,388
    
    
    
    (130
    )Deferred income taxes
    
    
    4,367
    
    
    
    5,050Non-cash stock compensation
    
    
    2,867
    
    
    
    4,349Acquisition costs
    
    
    (161
    )
    
    
    Equity loss
(income) on investment in unconsolidated affiliate
    
    
    (1,404
    )
    
    
    1,557Changes in assets and liabilities:Accounts receivable
    
    
    (2,878
    )
    
    
    (4,234
    )Prepaid expenses and other current assets
    
    
    604
    
    
    
    (1,144
    )Accounts payable and accrued expenses
    
    
    (1,000
    )
    
    
    (1,705
    )Other assets
    
    
    (333
    )
    
    
    575Other liabilities
    
    
    (748
    )
    
    
    (1,824
    )Net cash provided by operating activities
    
    
    36,191
    
    
    
    13,441Cash flows from investing activities:Purchase of intangible assets
    
    
    (975
    )
    
    
    Capital expenditures
    
    
    (3,971
    )
    
    
    (2,277
    )Other
    
    
    12
    
    
    
    (90
    )Net cash used in investing activities
    
    
    (4,934
    )
    
    
    (2,367
    )Cash flows from financing activities:Proceeds from bank credit facility
    
    
    
    
    
    
    750,000Repayments of borrowings from bank credit facility
    
    
    (7,940
    )
    
    
    (761,250
    )Payments for debt issuance costs
    
    
    
    
    
    
    (953
    )Tax withholding paid on behalf of employees
    
    
    (2,241
    )
    
    
    Proceeds from issuance of common stock
    
    
    52
    
    
    
    300Payments for repurchase of common stock
    
    
    (1,219
    )
    
    
    (279
    )Net cash used in financing activities
    
    
    (11,348
    )
    
    
    (12,182
    )Increase (decrease) in cash and cash equivalents
    
    
    19,909
    
    
    
    (1,108
    )Cash and cash equivalents at beginning of period
    
    
    32,286
    
    
    
    2,392Cash and cash equivalents at end of period
    
    $
    52,195
    
    
    $
    1,284Supplemental disclosures:Trade revenue
    
    $
    7,093
    
    
    $
    8,150Trade expense
    
    $
    6,967
    
    
    $
    8,259Interest paid
    
    $
    19,706
    
    
    $
    28,032
 See accompanying notes to condensed consolidated financial statements.
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Cumulus Media Inc.
Notes to Condensed Consolidated Financial Statements
(Unaudited)
 1. Interim Financial Data and Basis of Presentation
 Interim Financial Data
   Recent Accounting Pronouncements
 Business Combinations
 SFAS 157 Fair Value Measurements
 Goodwill and Other
Intangible Assets Accounting for the Impairment and Disposal of
Long-Lived Assets Fair
Value Measurements,
 SFAS
159. The Fair Value Option for Financial
Assets and Financial Liabilities  Including an Amendment of
FASB Statement No. 115,(SFAS No 159)
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SFAS 161. Disclosures about Derivative
Instruments and Hedging Activities Accounting for Derivative Instruments and Hedging Activities
  FSP No. 142-3. Determination of the
Useful Lives of Intangible Assets
 2. Stock Based Compensation
   3. Investment in Affiliate
   4. Derivative Financial Instruments
  7




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5. Long Term Debt
  June 30,
    
    December 31,2008
    
    2007Term loan
    
    $
    728,360
    
    
    $
    736,300Less: Current portion of long-term debt
    
    
    7,400
    
    
    
    13,490$
    720,960
    
    
    $
    722,810
 2007 Refinancing
    8




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6. Fair Value Measurements
 Disclosures about Fair Value of Financial
Instruments
     9




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Quoted
    
    SignificantPrices in
    
    Other
    
    SignificantActive
    
    Observable
    
    UnobservableTotal Fair
    
    Markets
    
    Inputs
    
    InputsValue
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)Financial LiabilitiesInterest rate swap
    
    $
    3,513
    
    
    $
    
    
    
    $
    3,513
    
    
    $
    Interest rate swap  option
    
    
    3,743
    
    
    
    
    
    
    
    3,743
    
    
    
    Total liabilities
    
    $
    7,256
    
    
    $
    
    
    
    $
    7,256
    
    
    $
    
  7. Share Repurchase
   8. Earnings per Share
  Three Months Ended
    
    Six Months EndedJune 30,
    
    June 30,2008
    
    2007
    
    2008
    
    2007Numerator:Net income
    
    $
    30,289
    
    
    $
    2,539
    
    
    $
    26,049
    
    
    $
    725Denominator:Denominator for basic income per common share:Weighted average common shares outstanding
    
    
    43,077
    
    
    
    43,598
    
    
    
    43,062
    
    
    
    43,403Effect of dilutive securities:Options
    
    
    18
    
    
    
    540
    
    
    
    22
    
    
    
    569Restricted shares
    
    
    
    
    
    
    81
    
    
    
    
    
    
    
    76Shares applicable to diluted income per common share
    
    
    43,095
    
    
    
    44,219
    
    
    
    43,084
    
    
    
    44,048Basic income per common share
    
    $
    0.70
    
    
    $
    0.06
    
    
    $
    0.60
    
    
    $
    0.02Diluted income per common share
    
    $
    0.70
    
    
    $
    0.06
    
    
    $
    0.60
    
    
    $
    0.02
  June 30, 2008Restricted shares of Class A Common Stock
    
    
    967,375Options to purchase Class A Common Stock
    
    
    7,084,737Options to purchase Class C Common Stock
    
    
    1,500,690
  10




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9. Comprehensive Income
 Reporting Comprehensive Income,
 Three Months Ended
    
    Six Months EndedJune 30,
    
    June 30,2008
    
    2007
    
    2008
    
    2007Net income
    
    $
    30,289
    
    
    $
    2,539
    
    
    $
    26,049
    
    
    $
    725Yield adjustment  interest rate swap arrangement, net of tax
    
    
    (993
    )
    
    
    
    
    
    
    (1,986
    )
    
    
    Comprehensive income
    
    $
    29,296
    
    
    $
    2,539
    
    
    $
    24,063
    
    
    $
    725
 10. Commitments and Contingencies
       11




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11. Termination of Merger Agreement
     12




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12.
Subsequent Event
  13




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 General
  Overview
  Advertising Revenue and Station Operating Income
     14




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Results of Operations
 Analysis of Condensed Consolidated Statements of Operations.
 For the Three Months
    
    DollarEnded June 30,
    
    Change
    
    Percent Change2008
    
    2007
    
    2008 vs. 2007
    
    2008 vs. 2007STATEMENT OF OPERATIONS DATA:Net revenues
    
    $
    83,628
    
    
    $
    87,338
    
    
    $
    (3,710
    )
    
    
    -4.2
    %Station operating expenses
(excluding depreciation,
amortization
and LMA fees)
    
    
    52,975
    
    
    
    53,581
    
    
    
    (606
    )
    
    
    -1.1
    %Depreciation and amortization
    
    
    3,311
    
    
    
    3,690
    
    
    
    (379
    )
    
    
    10.3
    %LMA fees
    
    
    320
    
    
    
    165
    
    
    
    155
    
    
    
    93.9
    %Corporate general and administrative
(including non-cash stock
compensation expense)
    
    
    4,094
    
    
    
    6,052
    
    
    
    (1,958
    )
    
    
    -32.4
    %Costs
associated with terminated transaction
    
    
    1,753
    
    
    
    
    
    
    
    1,753
    
    
    
    100.0
    %Operating income
    
    
    21,175
    
    
    
    23,850
    
    
    
    (2,675
    )
    
    
    -11.2
    %Interest
income (expense), net
    
    
    581
    
    
    
    (10,457
    )
    
    
    11,038
    
    
    
    105.6
    %Loss on early extinguishment of debt
    
    
    
    
    
    
    (986
    )
    
    
    986
    
    
    
    100.0
    %Terminated transaction fee
    
    
    15,000
    
    
    
    
    
    
    
    15,000
    
    
    
    100.0
    %Other expense, net
    
    
    (25
    )
    
    
    (142
    )
    
    
    117
    
    
    
    82.4
    %Income tax expense
    
    
    (8,094
    )
    
    
    (8,987
    )
    
    
    893
    
    
    
    9.9
    %Equity in gain (loss) of affiliate
    
    
    1,652
    
    
    
    (739
    )
    
    
    2,391
    
    
    
    323.5
    %Net income
    
    $
    30,289
    
    
    $
    2,539
    
    
    $
    27,750
    
    
    
    **OTHER DATA:Station Operating Income (1)
    
    $
    30,653
    
    
    $
    33,757
    
    
    $
    (3,104
    )
    
    
    -9.2
    %Station Operating Income Margin (2)
    
    
    36.7
    %
    
    
    38.7
    %
    
    
    *
    *
    
    
    *
    *
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For the Six Months
    
    DollarEnded June 30,
    
    Change
    
    Percent Change2008
    
    2007
    
    2008 vs. 2007
    
    2008 vs. 2007STATEMENT OF OPERATIONS DATA:Net revenues
    
    $
    156,527
    
    
    $
    159,739
    
    
    $
    (3,212
    )
    
    
    -2.0
    %Station operating expenses excluding
depreciation, amortization
and LMA fees
    
    
    104,124
    
    
    
    105,228
    
    
    
    (1,104
    )
    
    
    -1.0
    %Depreciation and amortization
    
    
    6,421
    
    
    
    7,560
    
    
    
    (1,139
    )
    
    
    -15.1
    %LMA fees
    
    
    500
    
    
    
    331
    
    
    
    169
    
    
    
    51.1
    %Corporate general and administrative
(including non-cash stock
compensation expense)
    
    
    9,555
    
    
    
    12,780
    
    
    
    (3,225
    )
    
    
    -25.2
    %Costs
associated with terminated transaction
    
    
    1,893
    
    
    
    
    
    
    
    1,893
    
    
    
    100.0
    %Operating income
    
    
    34,034
    
    
    
    33,840
    
    
    
    194
    
    
    
    0.6
    %Interest expense, net
    
    
    (19,951
    )
    
    
    (25,001
    )
    
    
    5,050
    
    
    
    20.2
    %Loss on early extinguishment of debt
    
    
    
    
    
    
    (986
    )
    
    
    986
    
    
    
    100.0
    %Terminated transaction fee
    
    
    15,000
    
    
    
    
    
    
    
    15,000
    
    
    
    100.0
    %Other expense, net
    
    
    (7
    )
    
    
    (171
    )
    
    
    164
    
    
    
    95.9Income tax expense
    
    
    (4,431
    )
    
    
    (5,400
    )
    
    
    969
    
    
    
    17.9
    %Equity in gain (loss) of affiliate
    
    
    1,404
    
    
    
    (1,557
    )
    
    
    2,961
    
    
    
    190.2
    %Net income
    
    $
    26,049
    
    
    $
    725
    
    
    $
    25,324
    
    
    
    *
    *OTHER DATA:Station operating income (1)
    
    $
    52,403
    
    
    $
    54,511
    
    
    $
    (2,108
    )
    
    
    -3.9
    %Station operating income margin (2)
    
    
    33.5
    %
    
    
    34.1
    %
    
    
    *
    *
    
    
    *
    *Cash flows related to:Operating activities
    
    
    36,191
    
    
    
    13,441
    
    
    
    22,750
    
    
    
    169.3
    %Investing activities
    
    
    (4,934
    )
    
    
    (2,367
    )
    
    
    (2,567
    )
    
    
    -108.4
    %Financing activities
    
    
    (11,348
    )
    
    
    (12,182
    )
    
    
    834
    
    
    
    6.8
    %Capital expenditures
    
    $
    (3,971
    )
    
    $
    (2,277
    )
    
    $
    (1,694
    )
    
    
    -74.4
    %
 
 **
    
    Not a meaningful calculation to present.(1)
    
    Station operating income consists of operating income before depreciation and amortization,
LMA fees, corporate general and administrative expenses, non-cash
stock compensation, and costs associated with the terminated transaction.
Station operating income is not a measure of performance calculated in accordance with GAAP.
Station operating income should not be considered in isolation or as a substitute for net
income, operating income (loss), cash flows from operating activities or any other measure for
determining our operating performance or liquidity that is calculated in accordance with GAAP.
See managements explanation of this measure and the reasons for its use and presentation,
along with a quantitative reconciliation of station operating income to its most directly
comparable financial measure calculated and presented in accordance with GAAP, below.(2)
    
    Station operating income margin is defined as station operating income as a percentage of net
revenues. Three Months Ended June 30, 2008 Versus the Three Months Ended June 30, 2007.
 Net Revenues.
 Station Operating Expenses, Excluding Depreciation, Amortization and LMA Fees.
 Depreciation and Amortization.
 16




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##### Table of Contents



LMA Fees.
 Corporate, General and Administrative Expenses Including Non-cash Stock Compensation.
 Nonoperating (Income) Expense.
 For the Three MonthsEnded June 30,
    
    
    Dollar2008
    
    
    2007
    
    
    ChangeBank Borrowings  term loan and revolving credit facilities
    
    $
    8,069
    
    
    $
    13,866
    
    
    $
    (5,797
    )Bank Borrowings yield adjustment  interest rate swap arrangement  net
    
    
    326
    
    
    
    (1,459
    )
    
    
    1,785Change in fair value of interest rate swap agreement
    
    
    (3,308
    )
    
    
    (1,352
    )
    
    
    (1,956
    )Change in fair value of interest rate option agreement
    
    
    (5,589
    )
    
    
    (773
    )
    
    
    (4,816
    )Other interest expense
    
    
    204
    
    
    
    281
    
    
    
    (77
    )Interest income
    
    
    (283
    )
    
    
    (106
    )
    
    
    (177
    )Interest (income) expense, net
    
    $
    (581
    )
    
    $
    10,457
    
    
    $
    (11,038
    )
 Terminated
Transaction Fee.
 Income
Taxes.
 Station Operating Income .
   17




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##### Table of Contents



Reconciliation of Non-GAAP Financial Measure.
 For the Three Months
    
    
    DollarEnded June 30,
    
    
    Change
    
    
    Percent Change2008
    
    
    2007
    
    
    2008 vs. 2007
    
    
    2008 vs. 2007Operating income
    
    $
    21,175
    
    
    $
    23,850
    
    
    $
    (2,675
    )
    
    
    -11.2
    %Depreciation and amortization
    
    
    3,311
    
    
    
    3,690
    
    
    
    (379
    )
    
    
    -10.3
    %LMA fees
    
    
    320
    
    
    
    165
    
    
    
    155
    
    
    
    93.9
    %Corporate general and administrative
(including non-cash stock compensation)
    
    
    4,094
    
    
    
    6,052
    
    
    
    (1,958
    )
    
    
    -32.4
    %Cost associated with terminated transaction
    
    
    1,753
    
    
    
    
    
    
    
    1,753
    
    
    
    100.0
    %Station operating income
    
    $
    30,653
    
    
    $
    33,757
    
    
    $
    (3,104
    )
    
    
    -9.2
    %
 Six Months Ended June 30, 2008 Versus the Six Months Ended June 30, 2007.
 Net Revenues.
 Station Operating Expenses, Excluding Depreciation, Amortization and LMA Fees.
 Depreciation
and Amortization.
 LMA Fees.
 Corporate, General and Administrative Expenses Including Non-cash Stock Compensation.
 Non-operating (Income) Expense.
 18




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##### Table of Contents



For the Six MonthsEnded June 30,
    
    Dollar2008
    
    2007
    
    ChangeBank Borrowings  term loan and revolving credit facilities
    
    $
    18,326
    
    
    $
    27,578
    
    
    $
    (9,252
    )Bank Borrowings yield adjustment  interest rate swap arrangement  net
    
    
    (560
    )
    
    
    (2,800
    )
    
    
    2,240Change in fair value of interest rate swap agreement
    
    
    3,081
    
    
    
    668
    
    
    
    2,413Change in fair value of interest rate option agreement
    
    
    (693
    )
    
    
    (799
    )
    
    
    106Other interest expense
    
    
    407
    
    
    
    544
    
    
    
    (137
    )Interest income
    
    
    (610
    )
    
    
    (190
    )
    
    
    (420
    )Interest expense, net
    
    $
    19,951
    
    
    $
    25,001
    
    
    $
    (5,050
    )
 Terminated
Transaction Fee.
 Income
Taxes.
 Station Operating Income.
 Reconciliation of Non-GAAP Financial Measure.
 For the Six Months
    
    DollarEnded June 30,
    
    Change
    
    Percent Change2008
    
    2007
    
    2008 vs. 2007
    
    2008 vs. 2007Operating income
    
    $
    34,034
    
    
    $
    33,840
    
    
    $
    194
    
    
    
    0.6
    %Depreciation and amortization
    
    
    6,421
    
    
    
    7,560
    
    
    
    (1,139
    )
    
    
    -15.1
    %LMA fees
    
    
    500
    
    
    
    331
    
    
    
    169
    
    
    
    51.1
    %Corporate general and administrative
(including non-cash stock compensation)
    
    
    9,555
    
    
    
    12,780
    
    
    
    (3,225
    )
    
    
    -25.2
    %Cost associated with terminated transaction
    
    
    1,893
    
    
    
    
    
    
    
    1,893
    
    
    
    100.0
    %Station operating income
    
    $
    52,403
    
    
    $
    54,511
    
    
    $
    (2,108
    )
    
    
    -3.9
    %
 Intangible Assets (including Goodwill).
 Liquidity and Capital Resources
  19




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##### Table of Contents



2007 Refinancing
      20




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##### Table of Contents



21




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures about Market Risk
   
 Item 4. Controls and Procedures
   
 PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
    22




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##### Table of Contents



Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  Total Number
    
    Maximum Dollarof Shares
    
    Value of SharesPurchased as
    
    that mayTotal Number
    
    Average
    
    Part of Publicly
    
    Yet be Sharesof Shares
    
    Price Per
    
    Announced
    
    Purchased UnderPeriod
    
    Purchased
    
    Share
    
    Program
    
    the ProgramApril 1, 2008 - April 30, 2008
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    75,000,000May 1, 2008 - May 31, 2008
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    75,000,000June 1, 2008 - June 30, 2008
    
    
    281,928
    
    
    $
    4.325
    
    
    
    281,928
    
    
    $
    73,780,532Total
    
    
    281,928
    
    
    
    
    
    
    
    281,928
 
 Item 3. Defaults upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information
  23




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##### Table of Contents



Item 6. Exhibits
 3.1   
    
    Ammeded and Restated Bylaws, as amended.31.1 
    
    Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2 
    
    Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1 
    
    Officer Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 24




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##### Table of Contents



SIGNATURES
  CUMULUS MEDIA INC.Date: August 11, 2008
    By:
    /s/ Martin R. GausvikMartin R. GausvikExecutive Vice President,
Treasurer and Chief Financial Officer 25




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##### Table of Contents



EXHIBIT INDEX
 3.1   
    
    Ammeded and Restated Bylaws, as amended.31.1 
    
    Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2 
    
    Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1 
    
    Officer Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 26