Courtside Acquisition Corp. to Acquire American Community Newspapers LLC

  
    
  
  
    
      January 24, 2007:
    
    
      Courtside Acquisition Corp. (“Courtside”) 
      (AMEX: CRB), a specified purpose acquisition company, today announced 
      that it has signed a definitive asset purchase agreement with American 
      Community Newspapers LLC (“ACN”).
    
    
      Pursuant to the agreement, Courtside will acquire substantially all of 
      the assets of ACN for $165.0 million. Courtside will also pay up to an 
      additional $15 million in cash if newspaper cash flow for 2008 ranges 
      from $19 million (at which level the contingent payment is $1 million) 
      to $21 million or greater (at which level the contingent payment will be 
      $15 million). In addition, if the Courtside stock price exceeds $8.50 
      per share for a specified period before July 7, 2009, ACN will receive 
      an additional payment of $10 million. Following the closing of the 
      transaction, expected in the second quarter of 2007, Courtside will be 
      renamed American Community Newspapers Inc. and its securities are 
      expected to trade on the American Stock Exchange. ACN is currently owned 
      by Spire Capital Partners, L.P., Wachovia Capital Partners and members 
      of ACN’s senior management.
    
    
      ACN is a group of 73 publications, comprised of 60 weekly suburban 
      newspapers, three daily newspapers and 10 niche publications, and 
      operates in three highly attractive U.S. markets: Minneapolis – 
      St Paul, Dallas – Ft. Worth and suburban 
      Washington DC – Northern Virginia. ACN’s 
      award winning group of publications reaches approximately 875,000 
      households in the suburban communities surrounding these major cities 
      and enjoys market leading circulation penetration in each of its 
      markets. ACN is focused on providing high quality, local editorial 
      content to its readers and targeted advertising packages to local and 
      national advertisers.
    
    
      For the fiscal year ended December 31, 2006 (pro forma unaudited), ACN 
      generated revenue of approximately $53.5 million and Newspaper Cash Flow 
      and Adjusted EBITDA of approximately $14.4 million and $12.9 million 
      respectively. ACN experienced a compounded annual growth rate in revenue 
      and Adjusted EBITDA from 2004 to fiscal 2006 of 7.1% and 20.6%, 
      respectively.
    
    
      Following the closing of the transaction, Gene Carr will become the 
      Chief Executive Officer and Chairman of the Board of Courtside. Dan 
      Wilson will become Chief Financial Officer and Jeff Coolman will be the 
      Vice President of Sales and Minneapolis Group Publisher of Courtside, 
      holding the same positions they currently hold for ACN.
    
    
      Gene Carr commented, “We are privileged to be 
      able to continue our outstanding journalism and the commitment that we 
      have in serving the needs of our readers, advertisers and other 
      community constituents. ACN’s dedicated staff 
      of newspaper professionals has continued to produce award-winning 
      newspapers and is widely recognized in the industry as one of the best 
      at what they do in the suburban newspaper industry. The proposed 
      transaction is a great opportunity for our staff and management. During 
      the past 20 months, ACN has purchased four different newspaper groups 
      and successfully launched new media operations in all of our markets. 
      The new ownership structure in the public markets afford us increased 
      resources and the ability to grow American Community Newspapers even 
      faster by launching new newspapers in all three existing metro areas, to 
      acquire other suburban newspapers in each market, as well as the ability 
      to acquire or build similar suburban newspaper groups in other Top 50 
      markets in the U.S.”
    
    
      Messrs. Richard Goldstein and Bruce Greenwald, Chairman and President, 
      respectively, of Courtside, noted, “Courtside 
      was targeting a business combination in the entertainment, media and 
      communications industries, which would serve as a growth platform. ACN 
      is an ideal choice. It has outstanding assets, a strong record of 
      revenue, newspaper cash flow and EBITDA growth, and in our view, the 
      best management team in the industry, led by Gene Carr, Dan Wilson and 
      Jeff Coolman. All three of these key executives have agreed to long term 
      employment agreements with Gene becoming Chairman of our Board. We are 
      confident in this team’s ability to grow this 
      already outstanding business. We fully expect that the combined 
      resources of ACN’s asset base and management’s 
      proven track record of performance will enable continued EBITDA and 
      Newspaper Cash Flow growth in at least the mid teens.”
    
    
      The acquisition will be financed by Courtside’s 
      cash on hand, including approximately $77.0 million held in trust for 
      the exclusive use of effectuating our business combination, and 
      acquisition financing in excess of $100 million for which commitments 
      have been received from BMO Capital Markets, acting as Sole Book Runner 
      and Lead Arranger.
    
    
      BMO Capital Markets served as principal financial advisor to Courtside 
      in the transaction.
    
    
      Courtside has received an opinion from Capitalink L.C., an independent 
      investment banking firm, that the purchase price is fair, from a 
      financial point of view, to Courtside’s 
      shareholders. The transaction is subject to Courtside’s 
      receiving stockholder approval of the transaction and customary closing 
      conditions, including receipt of ACN’s 2006 
      audited financial statements. The transaction is expected to close in 
      the second quarter of 2007.
    
    
      About Courtside Acquisition Corp.
    
    
      Courtside Acquisition Corp. was formed on March 18, 2005 to serve as a 
      vehicle to effect a business combination with an operating business 
      principally in the entertainment, media and communications industries. 
      Courtside’s registration statement for its 
      initial public offering was declared effective on June 30, 2005 and the 
      offering closed on July 7, 2005, generating net proceeds of 
      approximately $75.7 million from the sale of 13.8 million units, 
      including the full exercise of the underwriters’ 
      over-allotment option. Each unit was comprised of one share of Courtside 
      common stock and two warrants, each with an exercise price of $5.00. As 
      of December 31, 2006, Courtside held approximately $77.0 million in a 
      trust account maintained by an independent trustee, which will be 
      released to Courtside upon the consummation of the business combination.
    
    
      Forward Looking Statements
    
    
      This press release may contain forward–looking 
      statements within the meaning of the Private Securities Litigation 
      Reform Act of 1995 about Courtside, ACN and their combined business 
      after completion of the proposed acquisition. Forward–looking 
      statements are statements that are not historical facts. Such forward–looking 
      statements, based upon the current beliefs and expectations of Courtside’s 
      and ACN’s management, are subject to risks 
      and uncertainties which could cause actual results to differ from the 
      forward-looking statements. The following factors, among others, could 
      cause actual results to differ from those set forth in the forward–looking 
      statements: business conditions; paper and printing costs; fluctuations 
      in customer demand; shifting of traditional media spending from print to 
      new media; management of rapid growth; intensity of competition from 
      other newspaper publishers; general or market specific economic 
      conditions; geopolitical events and regulatory changes; changing 
      interpretations of generally accepted accounting principles; outcomes of 
      government reviews; continued compliance with government regulations; 
      legislation or regulatory environments; requirements or changes 
      adversely affecting the businesses in which ACN is engaged; as well as 
      other relevant risks detailed in Courtside’s 
      filing with the Securities and Exchange Commission, including its 
      reports on Form 10–QSB and Form 10-K. The 
      information set forth herein should be read in light of such risks. 
      Additionally, ACN’s financial information was 
      prepared by ACN as a private company, and derived from financial 
      statements prepared in accordance with U.S. generally accepted 
      accounting principles. Such financial information does not conform to 
      SEC Regulation S–X. Accordingly, such 
      historical information will be adjusted and presented differently in 
      Courtside’s proxy statement to solicit 
      stockholder approval of the acquisition. Furthermore, this press release 
      includes certain financial information (Adjusted EBITDA and Newspaper 
      Cash Flow) not presented in accordance with generally accepted 
      accounting principles “GAAP”). 
      Accordingly, such information may be materially different when presented 
      in Courtside's proxy statement to solicit stockholder approval of the 
      merger. Courtside believes that the presentation of this non-GAAP 
      measure provides information that is useful to investors as it indicates 
      more clearly the ability of ACN to meet capital expenditures and working 
      capital requirements and otherwise meet its obligations as they become 
      due. ACN’s Adjusted EBITDA was derived by 
      taking earnings before interest, taxes, depreciation and amortization as 
      adjusted for certain one-time non-recurring items and exclusions. ACN’s 
      Newspaper Cash Flow was derived by taking earnings before corporate 
      overhead expenses, interest, taxes, depreciation and amortization as 
      adjusted for certain one-time non-recurring items and exclusions. In 
      calculating the pro forma consolidated statements of Adjusted EBITDA, 
      acquisitions (and a disposition) have been presented as if the 
      acquisitions (and disposition) were made as of the first day of the 
      earliest fiscal year presented. Neither Courtside nor ACN assumes any 
      obligation to update the information contained in this press release.
    
    
      Additional Information
    
    
      Courtside’s stockholders and other 
      interested parties are urged to read the proxy statement regarding the 
      proposed transaction when it becomes available because it will contain 
      important information. Copies of filings by Courtside, which will 
      contain information about Courtside and ACN, will be available without 
      charge online at the Securities and Exchange Commission’s 
      internet site (http://www.sec.gov) and 
      by mail through requests to Courtside Acquisition Corp., 1700 Broadway, 
      New York, New York 10019, Attention: Secretary.
    
    
      About the Sellers
    
    
      Spire Capital Partners, L.P. is a $260 million private equity fund that 
      invests in the media and communications industries. Wachovia Capital 
      Partners is the principal investing affiliate of Wachovia Corporation. 
      Wachovia Capital Partners has invested more than $2.5 billion since 1988.
    
    
      
        
          American Community Newspapers LLC
        
      
      
        
          Consolidated Balance Sheet
        
      
      
        
        
        
           
        
      
      
        
          
            (Unaudited) (1)
          
        
      
      
        
          (Dollars in thousands)
        
      
      
        
        
        
           
        
      
      
        
          ASSETS
        
        
          As of 

          
            December 31, 2006
          
        
      
      
        
          Cash
        
        
          $
        
        
          548 
        
      
      
        
          Accounts receivable, net
        
        
        
        
          5,277 
        
      
      
        
          Inventories
        
        
        
        
          373 
        
      
      
        
          Prepaid expenses and other
        
        
           
        
        
          276 
        
      
      
        
          Total Current Assets
        
        
           
        
        
          6,474 
        
      
      
        
          Property, Plant, & Equipment, net
        
        
        
        
          5,888 
        
      
      
        
          Goodwill
        
        
        
        
          58,614 
        
      
      
        
          Intangible assets, net
        
        
        
        
          24,267 
        
      
      
        
        
        
           
        
      
      
        
          TOTAL ASSETS
        
        
          $
        
        
          95,243 
        
      
      
        
        
        
           
        
      
      
        
          LIABILITIES AND MEMBERS' EQUITY
        
        
        
      
      
        
          Accounts payable
        
        
          $
        
        
          1,231 
        
      
      
        
          Current portion, long term debt
        
        
        
        
          5,917 
        
      
      
        
          Deferred revenue
        
        
        
        
          839 
        
      
      
        
          Accrued expenses
        
        
           
        
        
          2,906 
        
      
      
        
          Total Current Liabilities
        
        
           
        
        
          10,893 
        
      
      
        
          Long-term debt, less current portion
        
        
        
        
          47,010 
        
      
      
        
          Total Liabilities
        
        
        
        
          57,903 
        
      
      
        
          Members' Equity Including Senior Preferred Units and Preferred Units
        
        
        
        
          37,340 
        
      
      
        
        
        
           
        
      
      
        
          TOTAL LIABILITIES AND MEMBERS' EQUITY
        
        
          $
        
        
          95,243 
        
      
    
    
    
    
      
        
          American Community Newspapers LLC (and Predecessor)
        
      
      
        
          Consolidated Statements of Adjusted EBITDA (2)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            (Unaudited) (1)
          
        
      
      
        
          (Dollars in thousands)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          Fiscal Years Ended on or About December 31,
        
      
      
        
        
        
        
        
          2004 (a)
        
        
        
        
          
            2005 (a)
          
        
        
        
        
          2006 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Revenue
        
        
          $
        
        
          34,195 
        
        
        
        
          $
        
        
          39,546 
        
        
        
        
          $
        
        
          52,194 
        
      
      
        
          Operating expenses
        
        
           
        
        
          25,575 
        
        
        
        
           
        
        
          29,358 
        
        
        
        
           
        
        
          37,873 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
          Newspaper cash flow
        
        
        
        
          8,620 
        
        
        
        
        
        
          10,188 
        
        
        
        
        
        
          14,321 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Corporate expenses
        
        
           
        
        
          1,034 
        
        
        
        
           
        
        
          1,096 
        
        
        
        
           
        
        
          1,482 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Adjusted EBITDA
        
        
          $
        
        
          7,586 
        
        
        
        
          $
        
        
          9,092 
        
        
        
        
          $
        
        
          12,839 
        
      
    
    
      (a) Does not include information with respect to ACN’s 
      Kansas City newspaper group, which was sold in December 2005.
    
    
      
        
          American Community Newspapers LLC (and Predecessor)
        
      
      
        
          
            Pro Forma Consolidated Statements of Adjusted EBITDA (3)
          
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          
            (Unaudited) (1)
          
        
      
      
        
          (Dollars in thousands)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
          Fiscal Years Ended on or About December 31,
        
      
      
        
        
        
        
        
          2004 
        
        
        
        
          2005 
        
        
        
        
          2006 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Revenue
        
        
          $
        
        
          46,606 
        
        
        
        
          $
        
        
          49,805 
        
        
        
        
          $
        
        
          53,506 
        
      
      
        
          Operating expenses
        
        
           
        
        
          36,687 
        
        
        
        
           
        
        
          38,547 
        
        
        
        
           
        
        
          39,101 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
          Newspaper cash flow
        
        
        
        
          9,919 
        
        
        
        
        
        
          11,258 
        
        
        
        
        
        
          14,405 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Corporate expenses
        
        
           
        
        
          1,034 
        
        
        
        
           
        
        
          1,096 
        
        
        
        
           
        
        
          1,482 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Adjusted EBITDA
        
        
          $
        
        
          8,886 
        
        
        
        
          $
        
        
          10,162 
        
        
        
        
          $
        
        
          12,923 
        
      
    
    
      Notes:
    
    
      1.) The financial statements have not been audited. They will differ 
      from the financial statements which will be included in our proxy 
      statement.
    
    
      2.) This presentation includes certain financial information (Adjusted 
      EBITDA) not derived in accordance with GAAP. Courtside believes that the 
      presentation of this non-GAAP measure provides information that is 
      useful to investors as it indicates more clearly the ability of ACN to 
      meet capital expenditures and working capital requirements and otherwise 
      meet its obligations as they become due. ACN’s 
      Adjusted EBITDA was derived by taking earnings before interest, taxes, 
      depreciation and amortization as adjusted for discontinued operations 
      and certain one-time non-recurring items and exclusions.
    
    
      3.) The pro forma consolidated statements of Adjusted EBITDA is 
      presented with acquisitions (and a disposition) included as if the 
      acquisitions (and disposition) were made as of the first day of the 
      earliest fiscal year presented. See footnote 2 above for a definition of 
      Adjusted EBITDA.