Cumulus Media plans loans in exchange for 7¾% senior notes due 2019

By Susanna Moon

Chicago, March 22 – Cumulus Media Inc. is discussing a potential exchange with some holders of its 7¾% senior notes due 2019, according to an 8-K filing with the Securities and Exchange Commission.

The proposed exchange includes the following terms;

• Each note would be exchanged for up to 42.5% of the principal amount of each note in certificates, with the certificates representing interests in a trust that would hold a participation in the company’s $200 million revolving credit facility;

• The lenders under the company’s revolver would assign their commitments to a new lender; and

• The company’s revolver would be amended under an extension amendment to extend its maturity to May 15, 2020; to increase pricing to Libor plus a margin of 1,100 basis points, subject to a 1% Libor floor; and to raise the undrawn commitment fee to 5%.

Also, the agreement would be separately amended to modify the financial covenant to allow borrowing under the revolver in connection with the exchange; to require compliance with a consolidated first-lien net leverage ratio of 3.75 times for future draws; to eliminate the financial maintenance covenant; and to provide for each exchanging noteholder to receive its pro rata share of an offering of 19.9% of the company’s pro forma outstanding common stock after taking into account the issuance and full participation of the notes in the exchange.

In addition, the discussions have included the company potentially using additional capital to facilitate full participation by holders in the exchange, the filing noted.

The company said it continues to discuss the exchange, including potential modifications, but that it cannot assure that the exchange will take place.

The company said that it has recently entered into non-disclosure agreements with the holders, and that, under these non-disclosure agreements, the company agreed to publicly disclose this confidential information.

Cumulus is an Atlanta-based radio broadcaster.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.