SFX quadruples cash fee for 9 5/8% notes consent solicitation, also amends terms, extends deadline

By Toni Weeks

San Luis Obispo, Calif., Sept. 4 – SFX Entertainment, Inc. said it again extended the expiration date of its previously announced consent solicitation to amend the indenture governing its 9 5/8% second-lien senior secured notes due 2019, this time to 5 p.m. ET on Sept. 9.

The consent solicitation had been scheduled to expire at 5 p.m. ET on Sept. 5 and was originally to be 5 p.m. ET on Aug. 29. It began on Aug. 19.

The company also quadrupled the cash consent payment to $10.00 from $2.50 per $1,000 principal amount of securities and amended the terms of the solicitation.

According to a press release, the company will no longer seek to amend the definition of “consolidated EBITDA” to include in the calculation of consolidated EBITDA recoupments that SFX expects to receive from Management Vennootschap BVBA related to start-up investments made in connection with a live event. It will, however, continue to seek consents to include in the calculation of consolidated EBITDA the incremental contributions to consolidated EBITDA from certain marketing agreements entered into after the period for which consolidated EBITDA is being calculated and before the relevant date of determination.

The company had said previously that it would recoup $7.7 million from Management Vennootschap in connection with the live event. It also said that, due to multiple qualified marketing agreements made during or after the fiscal quarter ended June 30, it was eligible to make a roughly $54 million contribution to consolidated EBITDA.

Holders of record as of 5 p.m. ET on Aug. 18 are entitled to participate in the consent solicitation.

The consent payment is conditioned on, among other things, the receipt of consents representing a majority in principal amount of the outstanding securities as of the record date. The consent fee will be paid “promptly” following the expiration time.

Consents may be revoked at any time prior to the time at which the amendment becomes effective.

SFX had also announced that it intends to issue more of the existing 9 5/8% notes, which will constitute additional notes under the indenture.

Barclays (800 438-3242 or 212 528-7581) is the solicitation agent. MacKenzie Partners, Inc. (800 322-2885 or 212 929-5500) is the tabulation and information agent.

New York-based SFX is a producer of live events and digital entertainment content focused on electronic music culture and other world-class festivals.

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