The majority stockholder of KRXY-FM, a station near Olympia WA and to the southwest of Seattle, is selling his 80% stake – and when all is said and done, there will be four investors with a piece of the station.
KRXY is a Hot AC outlet with a Class A facility on 94.5 MHz with 710 W @ 955’. It calls itself ROXY.
Rodney J. Etherton is the four-way seller. His 400 share in Olympia Broadcasting Inc. will bring in a total of $1.2M, and by extrapolation, reveal a total station valuation ofo $1.5M.
The biggest shareholder standing after closing will be the only other current owner. Michael F. Marohn will add a 40% stake to his existing stake for a 60% majority interest in the station at the cost of $600K. The entire amount will be paid pursuant to terms of a promissory note, and Marohn’s existing 20% share will be put up as escrow and will be signed over to Etherton in the event Marohn “fails or refuses to close this transaction.”
Robert Hart is buying 100 shares (20%) for $300K, with $15M in earnest money, $30K cash at closing and a $255K note.
Jerry R. Farmer is buying 70 shares (14%) for $210K, with $10.5K in earnest money, $21K cash at closing and a $178.5K note.
Kay Pearson is buying 30 shares (6%) for $90K, with $4.5K in earnest money, $9K cash at closing and a $76.5K note.
It all works out to $30K in earnest money, $60K in cash and notes totaling $1.11M.
RBR-TVBR observation: This is one time we’d try really hard not to default. The parties used one of the DC law firms to prepare the FCC application (Lerman Senter) but used a Chehalis WA law firm to draw up the stock purchase contracts. If the local law firm’s name means anything, it may be particularly adept at picking clean the remains of a defaulting party. The local law firm is called Buzzard and Associates.