Amended Credit Deal Means Emmis Has To Sell More Assets

More Sales Coming

EMMIS COMMUNICATIONS has amended its debt and, in the process, must jettison more of its assets no later than JULY 18, 2018.

The fourth amendment to its 2014 Credit Agreement, entered on APRIL 18th, replaces the facility's maximum Total Leverage Ratio covenant through MAY 31st, 2018 and replaced it with a minimum Consolidated EBITDA covenant of $20 million, which will revert to a 4:1 leverage ratio for the quarter ending AUGUST 31, 2018 and thereafter.  The arrangement also reduces the Interest Coverage Ratio from 2:1 to 1.6:1, increases the applicable margin to 6% for ABR loans and 7% for Eurodollar loans, and accelerates maturity of its term loans to APRIL 18, 2019 and revolving loans to AUGUST 31, 2018.  But it also requires the sale of assets that will raise $80 million in cash proceeds, with definitive agreements by JANUARY 18th, 2018 and closing no later than JULY 18th, 2018, at which date EMMIS will also need to refinance its existing credit facility or face ratcheting fees and premiums.

As part of the amendment, EMMIS also has to pay a 1% fee of the term loan and revolving commitment to each lender which consented, a total of $1.5 million.

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