CC Media Holdings, Inc.
iHeartMedia, Consenting Lenders Agree to 24-Hour Extension to Forbearance Agreement
Mon 03/12/2018 22:44 PM
iHeartMedia and the consenting lenders have agreed to extend the term of their forbearance agreement by 24 hours, according to sources. The agreement was previously set to expire on the earliest of March 13 at 12:59 a.m. ET and an event of default under the credit agreement other than those under the forbearance agreement. The company is extending the agreement in order to continue seeking to reach a consensus with creditors around the company’s draft restructuring support agreement, according to sources.
After holding two calls today with creditor group advisors in attempts to reach consensus around the company’s draft restructuring support agreement dated March 11, iHeartMedia’s advisors were unable to solidify support from the number of creditors required in order to effectuate the draft RSA, according to sources.
The company has been receiving feedback from creditor advisors since disseminating the draft RSA to the groups, and today’s calls sought to resolve certain comments on the RSA (which was filed in an 8-K today), sources say. A point of contention on the calls surrounded a 25 bps bid/ask regarding the amount of reorganized iHeart equity to be distributed to the 2021 notes claims and legacy notes claims (which are classed together in the RSA), according to sources. Advisors to a group of 14% noteholders due 2021 said on the calls that their clients would not consent to receiving less than 5.25% of reorganized iHeart equity plus warrants, as compared with the 5% of reorganized iHeart equity contemplated as part of their recovery in the company’s latest draft RSA.
In the company and cooperation group’s respective restructuring term sheet drafts dated Feb. 8, the 2021 notes claims and legacy notes claims were slated to receive 5.25% in reorganized iHeart equity, but the company’s March 1, March 5 and March 11 restructuring term sheet proposals contemplate those notes claims receiving 5% of reorganized iHeart equity. The company’s March 11 proposal gives 1% of reorganized iHeart equity to existing equity holders and 94% of reorganized iHeart equity to term loan lenders and PGN noteholders. The company’s latest proposals are outlined follows:
iHeart is advised by Kirkland & Ellis and Moelis & Company, the cooperation group of term loan and PGN noteholders is advised by Jones Day and PJT Partners, the 14% noteholder group is advised by Gibson Dunn and GLC Advisors, the term loan lender group is advised by Arnold & Porter Kaye Scholer and Ducera, and a group of legacy noteholders is advised by White & Case.
After holding two calls today with creditor group advisors in attempts to reach consensus around the company’s draft restructuring support agreement dated March 11, iHeartMedia’s advisors were unable to solidify support from the number of creditors required in order to effectuate the draft RSA, according to sources.
The company has been receiving feedback from creditor advisors since disseminating the draft RSA to the groups, and today’s calls sought to resolve certain comments on the RSA (which was filed in an 8-K today), sources say. A point of contention on the calls surrounded a 25 bps bid/ask regarding the amount of reorganized iHeart equity to be distributed to the 2021 notes claims and legacy notes claims (which are classed together in the RSA), according to sources. Advisors to a group of 14% noteholders due 2021 said on the calls that their clients would not consent to receiving less than 5.25% of reorganized iHeart equity plus warrants, as compared with the 5% of reorganized iHeart equity contemplated as part of their recovery in the company’s latest draft RSA.
In the company and cooperation group’s respective restructuring term sheet drafts dated Feb. 8, the 2021 notes claims and legacy notes claims were slated to receive 5.25% in reorganized iHeart equity, but the company’s March 1, March 5 and March 11 restructuring term sheet proposals contemplate those notes claims receiving 5% of reorganized iHeart equity. The company’s March 11 proposal gives 1% of reorganized iHeart equity to existing equity holders and 94% of reorganized iHeart equity to term loan lenders and PGN noteholders. The company’s latest proposals are outlined follows:
iHeart is advised by Kirkland & Ellis and Moelis & Company, the cooperation group of term loan and PGN noteholders is advised by Jones Day and PJT Partners, the 14% noteholder group is advised by Gibson Dunn and GLC Advisors, the term loan lender group is advised by Arnold & Porter Kaye Scholer and Ducera, and a group of legacy noteholders is advised by White & Case.
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