LONG-TERM DEBT:

3 Months Ended

Mar. 31, 2013

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

7.  LONG-TERM DEBT:

Long-term debt consists of the following:

	March 31, 2013		December 31, 2012
	(Unaudited)
	(In thousands)
Senior bank term debt	$	376,336	$	377,297
63/8% Senior Subordinated Notes due February 2013		—		747
121/2%/15% Senior Subordinated Notes due May 2016		327,034		327,034
10% Senior Secured TV One Notes due March 2016		119,000		119,000
Total debt		822,370		824,078
Less: current portion		3,840		4,587
Less: original issue discount		4,994		5,360
Long-term debt, net	$	813,536	$	814,131

Credit Facilities

On March 31, 2011, the Company entered into a senior secured credit facility (the “2011 Credit Agreement”) with a syndicate of banks and simultaneously borrowed $386.0 million to retire all outstanding obligations under the Company’s previous amended and restated credit agreement and to fund our obligation with respect to a capital call initiated by TV One.  The total amount available under the 2011 Credit Agreement is $411.0 million, consisting of a $386.0 million senior bank term debt that matures on March 31, 2016, and a $25.0 million revolving loan facility that matures on March 31, 2015. Borrowings under the credit facilities are subject to compliance with certain covenants including, but not limited to, certain financial covenants. Proceeds from the credit facilities can be used for working capital, capital expenditures made in the ordinary course of business, its common stock repurchase program, permitted direct and indirect investments and other lawful corporate purposes. On December 19, 2012, the Company entered into an amendment to the 2011 Credit Agreement (the “December 2012 Amendment”). The December 2012 Amendment: (i) modifies financial covenant levels with respect to the Company's total-leverage, secured-leverage, and interest-coverage ratios; (ii) increases the amount of cash the Company can net for determination of its net indebtedness tests; and (iii) extends the time for certain of the 2011 Credit Agreement's call premium while reducing the time for its later and lower premium.

The 2011 Credit Agreement, as amended, contains affirmative and negative covenants that the Company is required to comply with, including:

(a) maintaining an interest coverage ratio of no less than:

§	1.10 to 1.00 on December 31, 2012, and the last day of each fiscal quarter through December 31, 2013;
§	1.20 to 1.00 on March 31, 2014, and the last day of each fiscal quarter through September 30, 2014;
§	1.25 to 1.00 on December 31, 2014, and the last day of each fiscal quarter through September 30, 2015; and
§	1.50 to 1.00 on December 31, 2015, and the last day of each fiscal quarter thereafter.

(b)   maintaining a senior secured leverage ratio of no greater than:

§	4.50 to 1.00 on September 30, 2012, and the last day of each fiscal quarter through December 31, 2013;
§	4.25 to 1.00 on March 31, 2014, and the last day of each fiscal quarter through June 30, 2014;
§	4.00 to 1.00 on September  30, 2014;
§	3.75 to 1.00 on December 31, 2014;
§	3.25 to 1.00 on March 31, 2015, and the last day of each fiscal quarter through September 30, 2015;
§	2.75 to 1.00 on December 31, 2015, and the last day of each fiscal quarter thereafter.

(c)   maintaining a total leverage ratio of no greater than:

§	8.50 to 1.00 on December 31, 2012, and the last day of each fiscal quarter through December 31, 2013;
§	8.25 to 1.00 on March 31, 2014, and June 30, 2014;
§	8.00 to 1.00 on September 30, 2014;
§	7.50 to 1.00 on December 31, 2014;
§	6.50 to 1.00 on March 31, 2015, and the last day of each fiscal quarter through September 30, 2015;
§	6.00 to 1.00 on December 31, 2015, and the last day of each fiscal quarter thereafter.

(d)   limitations on:

§	liens;
§	sale of assets;
§	payment of dividends; and
§	mergers.

As of March 31, 2013, ratios calculated in accordance with the 2011 Credit Agreement, as amended, are as follows:

	As of March 31, 2013			Covenant Limit			Excess Coverage
Pro Forma Last Twelve Months Covenant EBITDA (In millions)	$	86.6
Pro Forma Last Twelve Months Interest Expense (In millions)	$	68.7
Senior Debt (In millions)	$	352.4
Total Debt (In millions)	$	679.4
Senior Secured Leverage
Senior Secured Debt / Covenant EBITDA		4.07	x	4.50		x	0.43		x
Total Leverage
Total Debt / Covenant EBITDA		7.84	x		8.50	x		0.66	x
Interest Coverage
Covenant EBITDA / Interest Expense		1.26	x		1.10	x		0.16	x
EBITDA - Earnings before interest, taxes, depreciation and amortization

In accordance with the 2011 Credit Agreement, as amended, the calculations for the ratios above do not include the operating results and related debt of TV One.

As of March 31, 2013, the Company was in compliance with all of its financial covenants under the 2011 Credit Agreement, as amended.  

Under the terms of the 2011 Credit Agreement, as amended, interest on base rate loans is payable quarterly and interest on LIBOR loans is payable monthly or quarterly. The base rate is equal to the greater of: (i) the prime rate; (ii) the Federal Funds Effective Rate plus 0.50%; or (iii) the LIBOR Rate for a one-month period plus 1.00%.  The applicable margin on the 2011 Credit Agreement is between (i) 4.50% and 5.50% on the revolving portion of the facility and (ii) 5.00% (with a base rate floor of 2.5% per annum) and 6.00% (with a LIBOR floor of 1.5% per annum) on the term portion of the facility. The average interest rate was 7.50% for the three months ended March 31, 2013. Quarterly installments of 0.25%, or $960,000, of the principal balance on the term loan are payable on the last day of each March, June, September and December.

As of March 31, 2013, the Company had approximately $24.0 million of borrowing capacity under its revolving credit facility. After taking into consideration the financial covenants under the 2011 Credit Agreement, as amended, approximately $24.0 million was available to be borrowed.

As of March 31, 2013, the Company had outstanding approximately $376.3 million on its term credit facility. During the quarter ended March 31, 2013, the Company repaid approximately $1.0 million under the 2011 Credit Agreement, as amended. According to the terms of the Credit Agreement, as amended, there was no term loan principal repayment based on its December 31, 2012 excess cash flow calculation. The original issue discount is being reflected as an adjustment to the carrying amount of the debt obligation and amortized to interest expense over the term of the credit facility.

Senior Subordinated Notes

On November 24, 2010, we issued $286.8 million of our 12¹/₂%/15% Senior Subordinated Notes due May 2016 (the “12¹/₂%/15% Senior Subordinated Notes due May 2016”) in a private placement and exchanged and then cancelled approximately $97.0 million of $101.5 million in aggregate principal amount outstanding of our 8⅞% senior subordinated notes due 2011 (the “2011 Notes”) and approximately $199.3 million of $200.0 million in aggregate principal amount outstanding of our 6³/₈% Senior Subordinated Notes that matured in February 2013 (the “2013 Notes” and the 2013 Notes together with the 2011 Notes, the “Prior Notes”).  We entered into supplemental indentures in respect of each of the Prior Notes which waived any and all existing defaults and events of default that had arisen or may have arisen that may be waived and eliminated substantially all of the covenants in each indenture governing the Prior Notes, other than the covenants to pay principal and interest on the Prior Notes when due, and eliminated or modified the related events of default. Subsequently, all remaining outstanding 2011 Notes were repurchased pursuant to the indenture governing the 2011 Notes, effective as of December 24, 2010.

As of March 31, 2013, the Company had outstanding $327.0 million of our 12¹/₂%/15% Senior Subordinated Notes due May 2016. The 12¹/₂%/15% Senior Subordinated Notes due May 2016 had a carrying value of $327.0 million and a fair value of approximately $328.7 million as of March 31, 2013. The fair values were determined based on the trading value of the instruments as of the reporting date.

Interest payments under the terms of the 6³/₈% Senior Subordinated Notes that matured in February 2013, were due in February and August.  Based on the $747,000 principal balance of the 6³/₈% Senior Subordinated Notes outstanding at December 31, 2012, interest payments of $24,000 were paid each February and August through February 2013.

Interest on the 12¹/₂%/15% Senior Subordinated Notes was initially payable in cash, or at our election, partially in cash and partially through the issuance of additional 12¹/₂%/15% Senior Subordinated Notes (a “PIK Election”) on a quarterly basis in arrears on February 15, May 15, August 15 and November 15, commencing on February 15, 2011.  We made a PIK Election only with respect to interest accruing up to but not including May 15, 2012, and with respect to interest accruing from and after May 15, 2012, such interest accrues at a rate of 12¹/₂% payable in cash.

Interest on the 12¹/₂%/15% Senior Subordinated Notes due May 2016 accrued from the date of original issuance or, if interest had already been paid, from the date it was most recently paid.  Interest accrues for each quarterly period at a rate of 12¹/₂% for such quarterly period that interest is paid fully in cash.  However, during the period the PIK Election was in effect, the interest paid in cash and the interest paid-in-kind by issuance of additional 12¹/₂%/15% Senior Subordinated Notes due May 2016 (“PIK Notes”) accrued for such quarterly period at 6.0% cash per annum and 9.0% PIK per annum.

A PIK Election remained in effect through May 15, 2012. After May 15, 2012, interest accrued at a rate of 12¹/₂% and was payable wholly in cash and the Company no longer had an option to pay any portion of its interest through the issuance of PIK Notes. During the year ended December 31, 2012, the Company issued approximately $14.2 million of additional 12¹/₂%/15% Senior Subordinated Notes in accordance with the PIK Election that was in effect through May 15, 2012.

The indentures governing the Company’s 12¹/₂%/15% Senior Subordinated Notes also contain covenants that restrict, among other things, the ability of the Company to incur additional debt, purchase common stock, make capital expenditures, make investments or other restricted payments, swap or sell assets, engage in transactions with related parties, secure non-senior debt with assets, or merge, consolidate or sell all or substantially all of its assets.

The Company conducts a portion of its business through its subsidiaries. Certain of the Company’s subsidiaries have fully and unconditionally guaranteed the Company’s 12¹/₂%/15% Senior Subordinated Notes, the 6³/₈% Senior Subordinated Notes and the Company’s obligations under the 2011 Credit Agreement, as amended.

TV One Senior Secured Notes

In connection with the Redemption Financing, TV One issued $119.0 million in senior secured notes on February 25, 2011. The notes were issued in connection with the repurchase of equity interests from certain financial investors and TV One management. The notes bear interest at 10.0% per annum, which is payable monthly, and the entire principal amount is due on March 15, 2016.

Future scheduled minimum principal payments of debt as of March 31, 2013, are as follows:

	Credit Facility		Senior Subordinated Notes		TV One Senior Secured Notes		Total
	(Unaudited)
	(In thousands)
April – December 2013	$	2,880	$	—	$	—	$	2,880
2014		3,840		—		—		3,840
2015		3,840		—		—		3,840
2016		365,776		327,034		119,000		811,810
Total Debt	$	376,336	$	327,034	$	119,000	$	822,370