Apparently JP Morgan Chase is not happy with Cumulus’ plan to refinance. Cumulus says it needs to refinance and it needs to be done quickly, by January 27. In a 21-page lawsuit filed yesterday, Cumulus is accusing JP Morgan Chase of thwarting its refinance plan by breaching a 2013 credit agreement and unreasonably withholding consent to the refinance.
Cumulus has been trying to deal with its more than $2 billion in debt. It’s seeking a court order allowing it to proceed with a refinancing to deleverage the company by up to $305 million.
The Cumulus suit states that JP Morgan’s actions in its role as administrative agent under the credit agreement are threatening a deal it recently reached with bondholders, which was contingent upon the refinancing being completed by January 27. Cumulus is asking the court to force JP Morgan to consent to Cumulus’ refinancing plan.
Cumulus reached a deal with a majority of bondholders to refinance $610 million of senior notes due in 2019 using borrowings from Cumulus’s $200 million revolving line of credit. The deal would allow Cumulus to retire the notes at a discount of up to 50 cents on the dollar and avoid a “springing maturity” on a $1.84 billion loan that occurs if more than $200 million of the notes are outstanding in January 2019. But Cumulus said JP Morgan has refused to take steps required under the plan, including allowing the transfer of the revolving credit line to new lenders and executing a loan amendment allowing the company to access the credit line.
Cumulus needs to take four steps to complete the refinance. (Read the lawsuit HERE) And JP Morgan informed Cumulus on December 9 that it would not provide the assurance that it would “execute the assignments, amendments, and other documentation pertaining to the refinancing when the transaction was consumated.”
Reuters was first to report on the lawsuit.
I ain’t fishin’ those waters, shelly, as radio is, pretty much, “The Dead Sea” – salty enough to easily float, but still unsupportive of advanced life.
Still, thanks for comin’ out.
Sounds like you’ve given up on Cumulus putting you in charge, Ronnie.
Next time you angle for an American station position, try not criticizing what they sell. Vinegar and sugar, you know?
When the anaconda is locked on to the head and has its coils wrapped around the body, it’s hard to dial “0” – never mind 9-1-1.
And Steve Irwin is gone.