Audacy Gets More Time To Pay Down Debt And Avoid Bankruptcy

Audacy has signed another amendment to its credit agreement, giving the audio content provider 68 more days to avoid defaulting on $18.9 million in loans that will have come due by the end of this month, according to a Dec. 8 Securities and Exchange Commission filing. The Philadelphia Business Journal reports the extension comes as the company tries to reach an agreement with lenders to restructure its debt to avoid bankruptcy,

In the SEC filing, Philadelphia-based Audacy said if lenders holding the majority of the debt have not received a final form of agreement with Audacy over its debt repayment by Friday, the grace period will expire after 45 days. Audacy did not say in the filing how close it might be to reaching a deal with its lenders.

Audacy missed a $17 million debt repayment due on Oct. 31 and another $785,592 payment due on Nov. 8. Audacy sought and received a 30-day grace period, which was extended by 10 days. The company also has a third debt payment for $1.13 million due on Dec. 28. All three payments are part of the latest extension.

In all, Audacy is attempting to restructure $1.9 billion in debt and gain financial breathing room.

The latest repayment extensions come after JPMorgan Chase & Co. stepped down late last month from its role in covering Audacy’s defaulted loans should the company not be able to repay its debt. Chase, the nation’s largest bank, removed itself as the company’s letter of credit and swingline lender. A swingline loan is a short-term loan made by financial institutions that provides businesses with access to funds to cover debt commitments.

If Audacy failed to make payments, Chase would have been on the line to provide that swingline loan. The filing said Wilmington-based WSFS Financial Corp. will assume Chase’s former role.

As of the end of its fiscal third quarter on Sept. 30, Audacy said it had $57.4 million in cash or cash equivalents. While Audacy has enough cash to cover the debt due in the coming months, it still has more debt to pay down — including $926.4 million of debt set to mature next year — and has been losing money in recent years as advertising demand has fallen off since the pandemic began.

With quarterly losses mounting, Audacy said this past summer that it had deals in place to sell assets in Boston and Phoenix. If talks with its creditors fail, the company said at the time that a bankruptcy filing could be on the horizon. The company linked its declining advertising revenue to macroeconomic issues such as inflation. It noted that things are “to a large extent, outside our control” since lenders hold most of the cards with any potential restructuring.

In late October, Audacy lost its appeal of the New York Stock Exchange's decision to delist its stock. It now trades over-the-counter as AUDA. Trading of Audacy stock was halted May 16 with the NYSE informing the company that it would initiate a delisting proceeding due to the company's low stock price,

Audacy has more than 220 radio stations across the country.