NOTES PAYABLE AND COMMERCIAL BANK FINANCING

3 Months Ended

Mar. 31, 2020

Debt Disclosure [Abstract]

NOTES PAYABLE AND COMMERCIAL BANK FINANCING

NOTES PAYABLE AND COMMERCIAL BANK FINANCING:

Bank Credit Agreements

On March 17, 2020, we drew $648 million under STG's $650 million five-year revolving credit facility (the STG Revolving Credit Facility), priced at LIBOR plus 2.00%. As of March 31, 2020, there were $648 million outstanding borrowings, $1.4 million in letters of credit outstanding, and $0.6 million available under the STG Revolving Credit Facility. In April 2020, we repaid $423 million of the outstanding borrowings under the STG Revolving Credit Facility. On March 17, 2020, we drew down $225 million under DSG's $650 million five-year revolving credit facility (the DSG Revolving Credit Facility), priced at LIBOR plus 3.00%, subject to step-downs based on certain leverage ratios. As of March 31, 2020, there were $225 million outstanding borrowings and $425 million available under the DSG Revolving Credit Facility. The Bank Credit Agreements contain various restrictions and covenants, including a financial maintenance covenant only applicable if borrowings under the respective revolving credit facility exceed 35% of the total commitments of each facility, whereby the first lien leverage ratio (as defined in the respective credit agreements) would need to be below 4.5x and 6.25x for STG and DSG, respectively.  As of March 31, 2020, we were in compliance with all covenants. 

The draws on the revolving credit facilities were a precautionary measure to preserve the Company's financial flexibility in light of the current uncertainly in the global economy resulting from the novel coronavirus pandemic (COVID-19). If needed, the proceeds will be available to be used for working capital and general corporate purposes.

DSG Senior Notes

On March 23, 2020, we redeemed, at a discount, $5 million aggregate principal amount of DSG's 6.625% Notes due 2027 (the DSG 6.625% Notes and together with DSG's 5.375% Senior Secured Notes due 2026, the DSG Notes) for consideration of $3 million. We recognized a gain on extinguishment of the DSG 6.625% Notes of $2 million for the three months ended March 31, 2020. As of March 31, 2020, the DSG 6.625% Notes balance, net of deferred financing costs, was $1,781 million.

Notes payable and finance leases to affiliates

The current portion of notes payable, finance leases, and commercial bank financing in our consolidated balance sheets includes finance leases to affiliates of $2 million as of March 31, 2020 and December 31, 2019. Notes payable, finance leases, and commercial bank financing, less current portion, in our consolidated balance sheets includes finances leases to affiliates of $8 million and $9 million as of March 31, 2020 and December 31, 2019, respectively.

Debt of variable interest entities and guarantees of third-party debt

We jointly, severally, unconditionally, and irrevocably guarantee $55 million and $57 million of debt of certain third parties as of March 31, 2020 and December 31, 2019, respectively, of which $19 million and $20 million, net of deferred financing costs, related to consolidated VIEs that are included in our consolidated balance sheets as of March 31, 2020 and December 31, 2019, respectively. These guarantees primarily relate to the debt of Cunningham Broadcasting Corporation (Cunningham) as discussed under Cunningham Broadcasting Corporation within Note 9. Related Person Transactions. We have determined that, as of March 31, 2020, it is not probable that we would have to perform under any of these guarantees.