Townsquare Media, Inc.TSQ

Townsquare Media, Inc. Debt Disclosure

10-KFiled Mar 15, 20243 min read
Long-Term Debt
Total debt outstanding is summarized as follows (in thousands):

December 31,
2023		December 31,
2022
2026 Notes $503,618 $530,766 
Deferred financing costs
(3,960)(6,324)
          Total long-term debt$499,658 $524,442 

On January 6, 2021, the Company completed the private offering and sale of $550.0 million aggregate principal amount of 6.875% senior secured notes due 2026 (the “2026 Notes”) at an issue price of 100.0%. The 2026 Notes bear interest at a rate of 6.875% and mature on February 1, 2026. Interest on the 2026 Notes is payable semi-annually in cash in arrears on February 1 and August 1 of each year, commencing on August 1, 2021.
The Company’s obligations under the 2026 Notes are guaranteed by substantially all of its subsidiaries and assets. The Company may redeem the 2026 Notes in whole or in part, at its option, at a redemption price equal to 100% of the principal amount, subject to the following redemption prices, plus accrued and unpaid interest, if any to, but excluding, the redemption date:

PeriodPrice
Beginning February 1, 2023103.438 %
Beginning February 1, 2024101.719 %
Beginning February 1, 2025 and thereafter100.000 %

Change of Control

If the Company experiences certain change of control events, holders of the 2026 Notes may require the Company to repurchase all or part of their 2026 Notes at 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

Certain Covenants

The 2026 Notes indenture contains certain covenants that may limit, among other things, our ability to; incur additional indebtedness, declare or pay dividends, redeem stock, transfer or sell assets, make investments or agree to certain restrictions on the ability of restricted subsidiaries to make payments to the Company. Certain of these covenants will be suspended if the 2026 Notes are assigned an investment grade rating by Standard & Poor’s Investors Ratings Services, Moody’s Investors Service, Inc. or Fitch Ratings, Inc. and no event of default has occurred and is continuing.

During the year ended December 31, 2023, the Company voluntarily repurchased an aggregate $27.1 million principal amount of its 2026 Notes at or below par, plus accrued interest. The Company wrote-off approximately $0.3 million of unamortized deferred financing costs, recognizing a total net gain of $1.2 million in connection with the voluntary repurchases of its 2026 Notes. The repurchased notes were canceled by the Company.

During the year ended December 31, 2022, the Company voluntarily repurchased an aggregate $19.2 million principal amount of its 2026 Notes at or below par, plus accrued interest. The Company wrote-off approximately $0.3 million of unamortized deferred financing costs, recognizing a total net gain of $0.1 million in connection with the voluntary repurchases of its 2026 Notes. The repurchased notes were canceled by the Company.

The Company was in compliance with its covenants under the 2026 Notes indenture as of December 31, 2023.

As of December 31, 2023 and 2022, based on available market information, the estimated fair value of the 2026 Notes was $493.5 million and $472.4 million, respectively. The Company used Level 2 measurements under the fair value measurement hierarchy established under Fair Value Measurement (Topic 820).

The following table illustrates the components of our interest expense, net (in thousands):

Year Ended
December 31,
20232022
2026 Notes$35,534 $36,999 
Capital leases and other 1,350 1,140 
Deferred financing costs and discounts2,086 1,879 
Interest income(1,721)(190)
Interest expense, net $37,249 $39,828 
Annual maturities of the Company's long-term debt as of December 31, 2023 are as follows (in thousands):

(in thousands)
2024$— 
2025— 
2026503,618 
2027— 
2028— 
Thereafter— 
$503,618 
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Historical Timeline

Fiscal YearFiled
2023Mar 15, 2024Showing above
2022Mar 16, 2023
2021Mar 16, 2022
2020Mar 16, 2021
2019Jun 9, 2020
2018Mar 12, 2019
2017Mar 13, 2018
2016Mar 13, 2017
2015Feb 26, 2016

About Debt Disclosures

Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.

Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.

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