Freedom Communications in talks with lenders on possible covenant non-compliance

By Sara Rosenberg

New York, Oct. 7 - Freedom Communications Inc. is currently in active discussions with lenders under its senior credit facility regarding the belief that it may not be in compliance with formula-based financial covenants for the fiscal quarter ended Sept. 30, according to a news release.

The company said that it has and generates sufficient cash to meet its working capital requirements, and that a few weeks ago, in response to the uncertainty in the financial markets, it drew down the balance of its revolver.

Negatively impacting the company is the sustained weakness in newspaper and broadcast advertising, increased competition for advertising revenue from online media, newspaper circulation declines, the recent economic slowdown, and vulnerability to markets feeling the real estate collapse.

Freedom Communications is an Irvine, Calif.-based information and entertainment company of print publications, broadcast television stations and interactive businesses.

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