March 4, 2013
/PRNewswire/ -- Dial Global, Inc. (OTC Pink: DIAL) (the "
") announced today that the Company, its lenders and certain of its stockholders have agreed to recapitalize the Company's existing credit facilities, other obligations and equity interests.
, Dial Global's Chief Executive Officer, said, "The new agreements with our lenders represent a significant step forward for the Company. Once these transactions close, we will have de-levered our balance sheet and decreased cash interest expense. The agreements will provide us with greater flexibility to actively manage and grow our business. We look forward to closing these transactions in April and focusing on serving our clients."
As part of the recapitalization, the Company has entered into an Amended and Restated Credit Agreement, by and among the Company, General Electric Capital Corporation, as administrative agent and collateral agent, and the lenders party thereto (the "
First Lien Credit Agreement
"), which provides for a
paydown of the Company's existing term loan and revolving credit commitments. The maturity date under the First Lien Credit Agreement is
The Company also entered into a Priority Second Lien Credit Agreement among the Company, the administrative agent, the syndication agent and the lender party thereto, pursuant to which such lender agreed to invest an additional
through a term loan facility to the Company, with a maturity date of
, 2017. In connection with such lender's agreement to extend credit under the Priority Second Lien Credit Agreement, the Company agreed to issue it penny warrants to purchase 7.5% of the Company's common stock exercisable immediately following the consummation of the recapitalization. The effectiveness of each credit agreement is subject to the satisfaction of certain conditions.
The lenders ("
") under the Company's existing Second Lien Credit Agreement, dated as of
October 21, 2011
Second Lien Credit Agreement
") agreed, subject to the satisfaction of specified conditions, to restructure their existing approximately
in second lien obligations by amending and restating the Second Lien Credit Agreement to provide for a
term loan that matures five years after the expected closing of the recapitalization and exchanging approximately
in remaining obligations under the existing Second Lien Credit Agreement for a new series of preferred stock of the Company. As part of these agreements, these holders of preferred stock will be granted certain corporate governance rights. The Company also agreed to issue the 2L lenders for nominal consideration warrants to purchase 12.0% of the Company's common stock in connection with the exchange of a portion of the existing second lien obligations for preferred stock, which warrants will be exercisable at various dates after the recapitalization if the Company does not retire the
second lien term loan and the preferred stock held by such 2L lenders prior to the specified dates.
Under various subscription and exchange agreements between the Company and the holders of the Company's PIK Notes and Series A Preferred Stock, such holders have agreed, subject to the satisfaction of certain specified conditions, to exchange their PIK Notes and Series A Preferred Stock for equity securities of the Company and have further agreed to make an additional equity infusion of
The recapitalization is expected to become effective on or around
April 16, 2013
, subject to the satisfaction or waiver of certain conditions precedent set forth in the First Lien Credit Agreement, the Second Lien Credit Agreement and the other transaction documents. There can be no assurances that the recapitalization will be consummated on the terms described herein, or at all.
About Dial Global, Inc.
Dial Global (OTC Pink: DIAL) Defines Great Moments in sports, news and entertainment through its radio networks which are heard by over 225 million listeners a week. As America's leading provider and distributor of audio content to more than 8,500 radio stations nationwide, Dial Global produces over 200 news, sports, talk, music and entertainment programs, services and digital applications, jingles and imaging. For more information, visit
Note to Investors
This press release may contain certain forward-looking statements based on our current expectations, forecasts and assumptions that involve risks and uncertainties. This release does not constitute an offer to sell or a solicitation of offers to buy any securities of the Company. Forward-looking statements in this release are based on information available to us as of the date hereof. Our actual results may differ materially from those stated or implied in such forward-looking statements, due to risks and uncertainties associated with our business, which include the risk factors disclosed in our Form 10-Q filed on
November 15, 2012
and in our Form 10-K filed on
, 2012. Forward-looking statements include statements regarding our expectations, beliefs, intentions or strategies regarding the future and can be identified by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," and "would" or similar words. We assume no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise.