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EVC > SEC Filings for EVC > Form 8-K on 31-May-2013All Recent SEC Filings

Show all filings for ENTRAVISION COMMUNICATIONS CORP | Request a Trial to NEW EDGAR Online Pro

Form 8-K for ENTRAVISION COMMUNICATIONS CORP


31-May-2013

Entry into a Material Definitive Agreement, Creation of a Direct


Item 1.01. Entry into a Definitive Material Agreement.

New Credit Facility

On May 31, 2013, the Company entered into a new term loan and revolving credit facility of up to $405.0 million (the "New Credit Facility") pursuant to a Credit Agreement (the "Credit Agreement"), by and among the Company, certain other persons party thereto that are designated as a "Credit Party" (as defined in the Credit Agreement), General Electric Capital Corporation ("GE Capital"), as Agent for the several financial institutions from time to time party to the Credit Agreement (collectively, the "Lenders" and individually each a "Lender") and for itself as a Lender and such Lenders, and the other parties thereto.

The New Credit Facility described in the Credit Agreement consists of a $20,000,000 senior secured Term Loan A Facility (the "Term Loan A Facility"), a $375,000,000 senior secured Term Loan B Facility (the "Term Loan B Facility"; and together with the Term Loan A Facility, the "Term Loan Facilities") which, subject to the compliance by the Company of certain conditions contained in the Credit Agreement, may be drawn on a date of the Company's choosing between August 1, 2013 and August 15, 2013 (such date, the "Term Loan B Borrowing Date"), and a $30,000,000 senior secured Revolving Credit Facility (the "Revolving Credit Facility"). In addition, the New Credit Facility provides that the Company may increase the aggregate principal amount of the New Credit Facility by up to an additional $100.0 million, subject to the Company satisfying certain conditions.

Borrowings under the Term Loan A Facility will be used on the closing date of the New Credit Facility (the "Closing Date") (together with cash on hand of the Company) to (a) repay in full all of the outstanding obligations of the Company and its subsidiaries under that certain credit agreement dated as of December 20, 2012, among the Company, other persons party thereto designated as a credit party, GE Capital as Agent and the lenders party thereto (the "Former Credit Agreement") and to terminate such Former Credit Agreement, and (b) pay fees and expenses in connection the New Credit Facility. Subject to certain conditions contained in the Credit Agreement, the Borrower intends to use the borrowings under the Term Loan B Facility on the Term Loan B Borrowing Date to
(a) repay in full all of the outstanding loans under the Term Loan A Facility and (b) redeem in full all of the Company's 8.75% Senior Notes due 2017 (the "Senior Notes"). The Company intends to use any future borrowings under the Revolving Credit Facility to provide for working capital, capital expenditures and other general corporate purposes of the Company and from time to time fund a portion of certain acquisitions, in each case subject to the terms and conditions set forth in the Credit Agreement.

The New Credit Facility is guaranteed on a senior secured basis by all of the Company's existing and future wholly-owned domestic subsidiaries, which are also the guarantors under the Senior Notes. The New Credit Facility is secured on a first priority basis by the Company's and the Credit Parties' assets, which also secure the Senior Notes. The Company's borrowings under the New Credit Facility will effectively rank senior to the Senior Notes upon the terms set forth in that certain Collateral Trust and Intercreditor Agreement, dated July 27, 2010 (the "Intercreditor Agreement"), with Wells Fargo Bank, National Association, as the Trustee under the Indenture, and GE Capital, as the Collateral Trustee and as the administrative agent under the New Credit Facility. The "Indenture" refers to that certain Indenture dated as of July 27, 2010 among the Company, the other persons party thereto that are designated as "Initial Guarantors" and Wells Fargo Bank, National Association, as trustee. Upon the redemption of the outstanding Senior Notes in connection with the incurrence of the Term Loan B Facility on the Term Loan B Borrowing Date, the security interests and guaranties of the Company and its Credit Parties under the Indenture and the Senior Notes will be terminated and released.


The Company's borrowings under the New Credit Facility will bear interest on the outstanding principal amount thereof from the date when made at a rate per annum equal to either: (i) the Base Rate (as defined in the Credit Agreement) plus the Applicable Margin (as defined in the Credit Agreement); or (ii) LIBOR (as defined in the Credit Agreement) plus the Applicable Margin (as defined in the Credit Agreement). The Term Loan A Facility expires on the earlier to occur of the Term Loan B Borrowing Date and August 15, 2013, the Term Loan B Facility expires on May 31, 2020 (the "Term Loan B Maturity Date") and the Revolving Credit Facility expires on May 31, 2018 (the "Revolving Loan Maturity Date").

As defined in the New Credit Facility, "Applicable Margin" means:

(a) with respect to the Term Loans (i) if a Base Rate Loan, one and one half percent (1.50%) per annum and (ii) if a LIBOR Rate Loan, two and one half percent (2.50%) per annum; and

(b) with respect to the Revolving Loans:

(i) for the period commencing on the Closing Date through the last day of the calendar month during which financial statements for the fiscal quarter ending June 30, 2013 are delivered: (A) if a Base Rate Loan, one and one half percent (1.50%) per annum and (B) if a LIBOR Rate Loan, two and one half percent (2.50%) per annum; and

(ii) thereafter, the Applicable Margin for the Revolving Loans shall equal the applicable LIBOR margin or Base Rate margin in effect from time to time determined as set forth below based upon the applicable First Lien Net Leverage Ratio then in effect pursuant to the appropriate column under the table below:

       First Lien Net Leverage Ratio    LIBOR Margin        Base Rate Margin
        4.50 to 1.00                            2.50 %                  1.50 %
       < 4.50 to 1.00                            2.25 %                  1.25 %

In the event the Company engages in a transaction that has the effect of reducing the yield of any loans outstanding under the Term Loan B Facility within six months of the Term Loan B Borrowing Date, the Company will owe 1% of the amount of the loans so repriced or replaced to the Lenders thereof (such fee, the "Repricing Fee"). Other than the Repricing Fee, the amounts outstanding under the New Credit Facility may be prepaid at the option of the Company without premium or penalty, provided that certain limitations are observed, and subject to customary breakage fees in connection with the prepayment of a LIBOR rate loan. The principal amount of the (i) Term Loan A Facility shall be paid in . . .



Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth under Item 1.01 above relating to the New Credit Facility is incorporated by reference herein.



Item 8.01. Other Events.

On May 31, 2013, the Company issued a press release announcing its entry into the New Credit Facility. A copy of that press release is attached hereto as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference herein.



Item 9.01. Financial Statements and Exhibits.

Exhibits

99.1          Press Release issued by Entravision Communications Corporation on
              May 31, 2013.


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