UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): August 30, 2007
AMERICAN TOWER CORPORATION
(Exact Name of Registrant as Specified in Charter)
| Delaware | 001-14195 | 65-0723837 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
116 Huntington Avenue
Boston, Massachusetts 02116
(Address of Principal Executive Offices) (Zip Code)
(617) 375-7500
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 1.01 | Entry into a Material Definitive Agreement. |
On September 4, 2007, American Tower Corporation (the “Company”) issued a press release announcing that it had entered into a new $500.0 million senior unsecured term loan credit facility (the “Term Loan”).
The Company expects to receive net proceeds of approximately $498.5 million from the Term Loan and will use approximately $450.0 million to repay certain existing indebtedness under the Company’s continuing senior unsecured revolving credit facility and the remainder for general corporate purposes. The basis for determining interest rates for the Term Loan is determined at the option of the Company with the margin ranging between 0.40% to 1.25% above the LIBOR rate for LIBOR based borrowings or between 0.00% to 0.25% above the defined base rate for base rate borrowings, in each case based upon the Company’s debt ratings.
The Term Loan contains certain financial ratios and operating covenants and other restrictions (including limitations on additional debt, guaranties, sales of assets and liens) with which the Company must comply that are substantially consistent with the senior unsecured revolving credit facility, including the following three financial maintenance tests:
| • | a consolidated total leverage ratio (Total Debt to Adjusted EBITDA) of not greater than 6.00 to 1.00 for the Company and its subsidiaries (other than unrestricted subsidiaries); |
| • | a consolidated senior secured leverage ratio (Senior Secured Debt to Adjusted EBITDA) of not greater than 3.00 to 1.00 for the Company and its subsidiaries (other than unrestricted subsidiaries); and |
| • | an interest coverage ratio (Adjusted EBITDA to Interest Expense) of not less than 2.50 to 1.00 for the Company and its subsidiaries (other than unrestricted subsidiaries). |
Any failure to comply with the financial and operating covenants of the Term Loan would constitute a default, which could result in, among other things, the amounts outstanding, including all accrued interest, becoming immediately due and payable.
The loan agreement for the Term Loan is with Toronto Dominion (Texas) LLC, as Administrative Agent, JPMorgan Chase Bank, N.A., as Syndication Agent, and lenders that are signatories thereto. The borrower under the Term Loan is American Tower Corporation. The Term Loan has a term of five years and matures on August 30, 2012. All amounts will be due and payable in full at maturity. The Term Loan does not require amortization of principal and may be paid prior to maturity in whole or in part at the Company’s option without penalty or premium; provided however, that the Term Loan requires its mandatory prepayment, subject to certain limited exceptions, with the net proceeds from any future issuances, offerings or placements of debt obligations or equity securities by the Company, or by any of the Company’s subsidiaries (other than unrestricted subsidiaries), to unaffiliated third parties.
The foregoing is only a summary of certain provisions of the Term Loan and is qualified in its entirety by the terms of the loan agreement for the Term Loan, a copy of which will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2007. A copy of the press release is furnished herewith as Exhibit 99.1.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
Please refer to the discussion under Item 1.01 above, which is incorporated under this Item 2.03 by reference.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit No. | Description | |
| 99.1 | Press release, dated September 4, 2007 (Furnished herewith). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| AMERICAN TOWER CORPORATION | ||||||
| (Registrant) | ||||||
| Date: |
September 4, 2007 | By: | /s/ BRADLEY E. SINGER | |||
| Bradley E. Singer | ||||||
| Chief Financial Officer and Treasurer | ||||||
EXHIBIT INDEX
| Exhibit No. | Description | |
| 99.1 | Press release, dated September 4, 2007 (Furnished herewith). |