Westwood One says it has reached agreements with its senior lender, Wells Fargo Foothill, and holders of its senior notes to waive leverage covenants. However, WW1 in return committed to make some payments to reduce its debt load.
Here’s what the company told the SEC:
“On October 14, 2009, Westwood One, Inc. (the “ Company ”) entered into separate agreements with the holders of its Senior Notes and Wells Fargo Foothill to amend the terms of the Securities Purchase Agreement (governing the Senior Notes) and Senior Credit Facility ($20.0 million term loan and $15.0 million revolver), respectively, to waive compliance with the Company’s debt leverage covenants which were to be measured on December 31, 2009 on a trailing four-quarter basis. As part of the Securities Purchase Agreement amendment, the Company agreed to pay down its Senior Notes by using the gross proceeds of the offering and additional cash on hand, if necessary by: (i) $15.0 million if the gross proceeds of the offering are less than $40.0 million and (ii) $20.0 million (or more at the Company’s sole discretion) if the gross proceeds of the offering are equal to or greater than $40.0 million. If neither an offering of capital stock nor the proposed sale-leaseback of the Company’s Culver City properties occurs on or prior to March 31, 2010, the Company agreed to pay down $3.5 million of the Senior Notes. Any prepayments would be deemed optional prepayments under the Securities Purchase Agreement and made within 5 business days of the date the offering is consummated (in the case of clauses (i) or (ii) above) or April 7, 2010 in the event no offering or sale-leaseback was consummated. The aforementioned amendments also included consents by holders of the Senior Notes and Wells Fargo Foothill regarding the Culver City sale-leaseback described below and in the case of the amendment to the Senior Credit Facility, an increase in the letters of credit sub-limit from $1.5 to 2.0 million.”