Entercom Communications Announces Amendment of Its Credit Agreement
July 20 2020 - 4:05PM
Business Wire
Entercom Communications Corp. (NYSE: ETM) announced that today
it entered into an agreement to amend the financial covenants and
other provisions under its Credit Agreement solely for the benefit
of its revolver lenders (the “Amendment”). During the covenant
relief period, which extends through December 31, 2021, unless
terminated earlier by Entercom, the Amendment:
- Provides for a covenant holiday for the quarters ending
September 30, 2020 and December 31, 2020
- Recommences covenant testing beginning March 31, 2021 and
modifies the definition of Consolidated EBITDA by setting fixed
amounts for the quarters ending June 30, 2020, September 30, 2020
and December 31, 2020. These fixed amounts are the amounts
previously reported by Entercom to its lenders for the quarters
ending June 30, 2019, September 30, 2019 and December 31, 2019,
respectively.
- Increases the interest rate applicable to the 2024 Revolving
Credit Loans by 25 bps
- Adds a new minimum liquidity covenant of $75 million
- Limits the Company’s ability to issue additional 1st lien debt
to $200 million
- Imposes other restrictions, including certain limitations on
making restricted payments, redeeming notes and entering into
certain sale and lease-back transactions
- Provides that these amendment provisions fall away at the end
of the covenant relief period (e.g., the interest rate applicable
to the 2024 Revolving Credit Loans reverts back to the prior
applicable margin)
The foregoing summary of the Amendment does not purport to be
complete. A copy of the full Amendment is filed with the Company’s
Current Report on Form 8-K, dated today, as Exhibit 10.1.
“We are pleased to announce this credit facility amendment,
which addresses the significant impact that COVID-19 has had on the
economy and our advertising revenues,” said David J. Field,
Chairman, President and Chief Executive Officer, Entercom. “As
previously announced, we have taken a number of actions to reduce
costs and enhance our business model to both weather the storm and
emerge stronger. We ended the second quarter in a strong liquidity
position with $208 million of cash on-hand, up from $189 million at
the end of March. During the 2nd quarter, we saw sequential month
over month improvement in our revenue performance from April and we
see the same pattern of month over month improvement in our pacing
data for the 3rd quarter. Entercom is well positioned to fully
participate in the recovery and the attractive growth opportunities
in the audio space, with strong leadership positions in broadcast
radio and podcasting, the fastest growing digital audio platform,
unparalleled leadership in news and sports, and strong data and
analytics capabilities. We will provide further comments on our
performance and the outlook for the 3rd quarter during our 2nd
quarter earnings call on August 7th.”
Note Regarding Forward-Looking
Statements
The information in this news release is being widely
disseminated in accordance with the Securities and Exchange
Commission's Regulation FD.
This news announcement contains certain forward-looking
statements that are based upon current expectations and certain
unaudited information that is presented for illustrative purposes
only and involves certain risks and uncertainties within the
meaning of the U.S. Private Securities Litigation Reform Act of
1995. Additional information and key risks are described in the
Company’s filings on Forms S-4, 8-K, 10-Q and 10-K with the
Securities and Exchange Commission. Readers should note that these
statements might be impacted by several factors including changes
in the economic and regulatory climate and the business of radio
broadcasting, in general. The unaudited pro forma information and
same station operating data reflect adjustments and are presented
for comparative purposes only and do not purport to be indicative
of what has occurred or indicative of future operating results or
financial position. Accordingly, the Company’s actual performance
may differ materially from those stated or implied herein. The
Company assumes no obligation to publicly update or revise any
unaudited pro forma or forward-looking statements.
About Entercom Communications Corp.
Entercom Communications Corp. (NYSE: ETM) is a leading audio and
entertainment company engaging over 170 million consumers each
month through its iconic broadcast brands, expansive digital
platform, premium podcast network and live events and experiences.
With presence in every major U.S. market, and accessible on every
device, Entercom delivers the industry’s most compelling live and
on-demand content and experiences from voices and influencers its
communities trust and love. The company’s robust portfolio of
assets and integrated solutions offer advertisers today’s most
engaged audiences through targeted reach, brand amplification and
local activation—all at national scale. Entercom is the unrivaled
leader in local radio sports and news and the #1 creator of live,
original local audio content in the U.S. Learn more at
www.entercom.com, Facebook and Twitter (@Entercom).
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INVESTORS: Joseph Jaffoni, Jennifer Neuman, Norberto Aja
JCIR 212-835-8500 etm@jcir.com MEDIA: Esther-Mireya Tejeda
Entercom 212-649-9686 Esther-Mireya.Tejeda@Entercom.com
@EntercomPR
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