Radio One plans $400 million senior secured facility via Deutsche

By Sara Rosenberg

New York, June 16 - Radio One Inc. has received a commitment for a new $400 million senior secured credit facility, according to an 8-K filed with the Securities and Exchange Commission on Wednesday.

The facility consists of a $50 million revolver expected at Libor plus 450 basis points and a $350 million term loan B expected at Libor plus 500 bps with a 2% Libor floor and an original issue discount of 99.

Pricing is subject to change during syndication; however, the revolver will be priced 50 bps below the term loan.

Deutsche Bank is the lead bank on the deal and has committed to provide the revolver and to use commercially reasonable efforts to syndicate the term loan.

Financial covenants include a minimum interest coverage ratio and a maximum first-lien net leverage ratio.

Proceeds will be used to refinance the company's existing credit facility.

Completion of the credit facility is a condition of the company's exchange offer for all of its outstanding 8 7/8% senior subordinated notes due 2011 and 6 3/8% senior subordinated notes due 2013 into new 11%/12% senior grid notes due 2017.

The facility is also a condition to the company's offer of $100 million of new 8.5%/9.0% second-priority senior secured grid notes due 2016.

The final maturity date of the term loan is 91 days prior to the sixth anniversary of the initial closing of the offers, provided that the final maturity date of the term loan can instead be the date occurring on the seventh anniversary of the closing of the offers if $15 million or less of the second-lien notes remains outstanding on the last day of the company's fiscal quarter ended nearest to the initial term loan maturity date.

The final maturity date of the revolver will be four years from the closing of the offers.

Proceeds from the subscription offer will be used to fund the company's purchase of an additional 19% of the outstanding equity interests in TV One LLC for about $82 million.

The subscription offer expires on June 30 and the exchange offer expires on July 15.

Radio One is a Lanham, Md.-based diversified media company that primarily targets African-American and urban consumers.

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