MSGN Holdings, an indirect wholly owned subsidiary of MSG Networks, entered into an amended and restated credit agreement with JPMorgan Chase Bank as administrative agent and the lenders party thereto. The credit agreement amends and restates MSGN Holdings’ prior credit agreement, dated September 28, 2015.
According the related 8-K filing, the credit agreement provides MSGN Holdings with senior secured credit facilities consisting of a $1.10 billion term loan facility and a $250 million revolving credit facility. Under the agreement, the maturity date of the facilities was extended to October 11, 2024. On the effective date, proceeds from the term loan facility were used by MSGN Holdings to repay outstanding indebtedness under the existing credit agreement. Proceeds from the revolving credit facility, which was undrawn on the effective date, will be used by MSGN to fund working capital needs and for other general corporate purposes.
Up to $35 million of the revolving credit facility is available for the issuance of letters of credit. All borrowings under the revolving credit facility are subject to the satisfaction of customary conditions, including absence of a default and accuracy of representations and warranties.
Borrowings under the credit agreement bear interest at a floating rate, which, at the option of MSGN, may be either (a) a base rate plus an additional margin rate ranging from 0.25% to 1.25% per annum (determined based on a total net leverage ratio), or (b) a Eurodollar rate plus an additional margin rate ranging from 1.25% to 2.25% per annum (determined based on a total net leverage ratio), provided that for the period following the effective date until the delivery of the compliance certificate for the second full fiscal quarter of MSGN following the effective date, the additional margin rate used in calculating the floating rate will be (i) 0.50% per annum for borrowings bearing the base rate, and (ii) 1.50% per annum for borrowings bearing the Eurodollar rate.
The credit agreement requires MSGN Holdings to pay a commitment fee of between 0.225% and 0.30% (determined based on a total net leverage ratio) in respect of the average daily unused commitments under the Revolving Credit Facility. MSGN Holdings will also be required to pay customary letter of credit fees, as well as fronting fees, to banks that issue letters of credit to the Credit Agreement.
Guarantees and Security
MSG Networks, formerly The Madison Square Garden Company, is engaged in sports production, and content development and distribution. The company owns and operates two regional sports and entertainment networks, MSG Network (MSGN) and MSG+. Its networks are distributed throughout its territory, which includes all of New York State and significant portions of New Jersey and Connecticut, as well as parts of Pennsylvania.
