“Our fourth quarter results marked the end of a highly successful year for SBS as we generated our strongest performance in over a decade,” said Raúl Alarcón, Chairman and CEO.
To address the repayment of our outstanding 12.5% Senior Secured Notes (the “Notes”) which matured on April 15, 2017 and were payable on Monday, April 17, 2017 and as further discussed below, the Company has been pursuing a series of options, with the assistance of our legal and financial advisors, including discussions with third party capital providers (including a top-tier banking institution) and with representatives of the holders of our Notes and preferred stock.”
Alarcon also disclosed SBS recently defaulted on a debt payment.
"We have been pursuing the sale of certain non-core assets, including certain of our television stations and real estate assets. In connection with our recapitalization plan, we have initiated conversations with representatives of the Noteholders and holders of our 10¾% Series B Cumulative Exchangeable Redeemable Preferred Stock (the “Series B preferred stock”) regarding these matters. We cannot assure you that we will be successful in our recapitalization efforts.
"We did not repay the Notes at their maturity, as a result of which there was an event of default under the Indenture on April 17, 2017, which is the payment date following the Saturday, April 15, 2017 maturity date. In addition, we are in default with the security agreement covenant relating to deposit account control agreements and the related Indenture covenant regarding compliance with the security agreement, and we are in default under the Future Guarantors covenant of the Indenture (though we have delivered documentation to the Trustee to have the subsidiary become an additional guarantor of the Notes). The Notes will continue to earn interest after the maturity date. We face various risks regarding these matters which are summarized in our Annual Report on Form 10-K for the year ended December 31, 2016."