Live Nation amendment provides for $1.53 billion in three tranches

By Wendy Van Sickle

Columbus, Ohio, Oct. 31 – Live Nation Entertainment Inc. amended its credit agreement to provide for a new $365 million revolving credit facility, a new five-year $190 million term A loan and a new seven-year $975 million term B loan, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement was entered into on May 6, 2010, and JPMorgan Chase Bank, NA is administrative agent.

Revolving and term A loans bear interest at Libor plus a margin ranging from 175 basis points to 225 bps, depending on leverage ratio. The term B loans bear interest at Libor plus 250 bps.

The revolver has a commitment fee of 50 bps or of 37.5 bps if the company’s net leverage ratio is no greater than 3.25 times.

The term loan A amortizes at a rate ranging from 1.25% of original principal a quarter for the first year up to 15% a quarter in the last year. The term loan B amortizes at 0.25% a quarter.

Live Nation may increase the facilities by up to the sum of $625 million plus the principal amount of voluntary prepayments of the term B loans and permanent reductions of the revolver and additional amounts so long as the senior secured leverage ratio, on a pro forma basis after giving effect to such increase, does not exceed 3.25 times.

The revolver has a $150 million sublimit for letters of credit, a $50 million sublimit for swingline loans, a $200 million sublimit for borrowings in euros or pounds sterling and a $50 million sublimit for other approved-currency borrowings.

The company must comply with covenants and restrictions including a maximum ratio of consolidated total funded debt to consolidated EBITDA that ranges from 5.5 times to 4.5 times with annual step downs beginning Dec. 31, 2017.

Proceeds are expected to be used for acquisitions and general corporate purposes, including to redeem the company’s 7% senior notes due 2020.

Live Nation is a Beverly Hills, Calif.-based provider of live music concerts and live entertainment ticketing sales and marketing services.

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