Media General amends loan, revising leverage covenant this quarter

By Sara Rosenberg

New York, Feb. 10 - Media General Inc. amended its credit facility, modifying the leverage ratio during the first quarter and waiving a Feb. 9 deadline to demonstrate covenant compliance on a prospective basis, according to an 8-K filed with the Securities and Exchange Commission on Friday.

Under the amendment, the maximum leverage ratio from Dec. 26 through March 23 is 7.60 times, dropping to 6.75 times from March 24 through June 24, 6.00 times from June 25 through Sept. 23, 2012 and 5.5 times thereafter.

The amendment was completed on Feb. 8.

Bank of America is the administrative agent on the deal.

The company explained in a news release that the amendment provides near-term flexibility as it pursues discussions regarding covenant revisions and an extension of the maturity of $363 million of bank debt due March 29, 2013.

"We are seeking covenant amendments that would provide more flexibility to operate in a continued uncertain advertising environment, particularly in our print business, and an extension that would provide Media General with time and flexibility to reduce total debt and to refinance," said James F. Woodward, vice president-finance and chief financial officer in the release.

Media General is a Richmond, Va.-based multimedia provider of broadcast television, digital media and print products.

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