Radio One Revamps Refinancing Deal
November 9, 2010 at 4:26 AM (PT)
In a renegotiated deal with its lender WELLS FARGO, RADIO ONE, INC. has amended its pending exchange offer designed to refinance substantially all of its existing debt under its 8 7/8% Senior Subordinated Notes due 2011 and its 6 3/8% Senior Subordinated Notes due 2013, and has also announced terms of a proposed amendment to its existing senior secured credit facility.
The amended exchange offer will trade $1,000 principal amount of 12.5%/15% Senior Subordinated Notes due 2016 for the same amount of the 2011 Notes; and $950 principal amount of the new notes for each $1,000 of the 2013 Notes, along with deletion of substantially all of the covenants in the notes. The new notes have been amended to provide for 66 months maturity, interest of 12.5% per annum if paid in cash or 15% per annum if paid partially in cash and partially in additional notes, and a subordination limit of $415 million.
The credit facility amendment will, among other things, establish new financial covenant levels, waive any pre-existing default or event of default, replace $323 million of outstanding revolving loans with a new term loan, and provide revolving credit up to $20 million for working capital and general corporate purposes and $18.8 million for certain specified purposes.
The new terms of the credit facility must be approved by lenders holding the majority of outstanding loans and commitments and are also conditioned on the completion of the amended exchange offer, while the exchange offer is conditional upon the approval of the credit facility amendment. 95% of the 2011 and 2013 notes in aggregate must be validly tendered and not withdrawn for the offer to go forward. As of FRIDAY at 5p, 92% of the notes had been tendered. Tenders made before last FRIDAY can be withdrawn by 5p (ET) FRIDAY (11/12).
In a support agreement, RADIO ONE has reached a deal with holders of 86.8% of the outstanding existing notes, who have agreed to tender all of their notes into the new exchange offer. The deal will also allow the company to pay overdue interest that was due on AUGUST 16th to holders of the 2013 notes.
The amended exchange offer will expire at 5p (ET) NOVEMBER 19th.