Sinclair Announces Any and All Private Debt Exchange Offer and Consent Solicitation of 4.375% Second-Out First Lien Secured Notes of Sinclair Television Group

Sinclair, Inc. (Nasdaq: SBGI), the "Company" or "Sinclair") today announced that Sinclair Television Group, Inc. (“STG” or the “Issuer”) has commenced a private exchange offer (the “Exchange Offer”) to Eligible Holders (as defined below) of 4.375% Second-Out First Lien Secured Notes due 2032 (144A CUSIP / ISIN: 829259BF6 / US829259BF69; REG S CUSIP / ISIN: U8275QAN0 / USU8275QAN08) (the “Exchange Second-Out Notes”) for any and all of the Issuer’s outstanding 4.125% Senior Secured Notes due 2030 (144A CUSIP / ISIN: 829259BA7 / US829259BA72; REG S CUSIP / ISIN: U8275QAK6 / USU8275QAK68) (the “Existing Notes”), on the terms and subject to the conditions set forth in a Confidential Offering Memorandum, Offer to Exchange and Consent Solicitation Statement, dated as of January 27, 2025 (the “Offer Documents”).

Concurrently with the Exchange Offer, the Issuer is soliciting consents (the “Consent Solicitation”) from Eligible Holders of the Existing Notes with respect to certain amendments, supplements and other modifications (the “Proposed Amendments”) to the indenture governing the Existing Notes (the “Existing Indenture”). The Proposed Amendments would, among other things (a) eliminate substantially all of the restrictive covenants and certain of the events of default and related definitions contained in the Existing Indenture, (b) permit the Issuer to consummate the financing transactions (the “Other Transactions”) described in the previously disclosed transaction support agreement (the “Transaction Support Agreement”) and (c) provide for the termination of the liens on the collateral securing the Existing Notes that remain outstanding following completion of the Exchange Offer and Consent Solicitation (as amended, the “4.125% Unsecured Notes”), with the 4.125% Unsecured Notes constituting senior unsecured obligations of the Issuer and the guarantors, subordinated in right of security to all existing and future senior secured obligations of the Issuer and the guarantors. Holders of Existing Notes may validly deliver their consents in the Consent Solicitation by tendering Existing Notes, in which case the holders will be deemed to have delivered their consents (the “Exchange and Consent Option”) or by delivering their consents without tendering Existing Notes (the “Consent Only Option”) Eligible Holders may not tender Existing Secured Notes without delivering their consents.

The Issuer must receive the consents from holders of at least two-thirds (66 2/3%) in aggregate principal amount of outstanding Existing Notes not owned by the Issuer or any of its affiliates (the “Requisite Notes Consents”) to adopt the Proposed Amendments. As of the date hereof, various holders of the Existing Notes who are parties to the Transaction Support Agreement (such holders, collectively, the “Support Agreement Consenting Holders”) hold Existing Notes representing the Requisite Notes Consents and have separately agreed to deliver consents to the Proposed Amendments (by electing to participate in either the Exchange and Consent Option or the Consent Only Option, as applicable to such holder). Upon receipt of the Requisite Notes Consents, the Issuer and the guarantors of the Existing Notes expect to execute a supplemental indenture to the Existing Indenture (the “Supplemental Indenture”) providing for the Proposed Amendments.

The Exchange Offer and Consent Solicitation, including the Issuer’s acceptance of validly tendered Existing Notes and payment of the applicable consideration, is conditioned on the satisfaction or waiver of certain conditions precedent, including, but not limited to, the substantially contemporaneous consummation of the Other Transactions, as further described in the Offer Documents. The Issuer may terminate, withdraw, amend or extend the Exchange Offer and/or Consent Solicitation in its sole discretion, subject to certain exceptions.

As of the date hereof, the Support Agreement Consenting Holders have agreed to deliver the Requisite Notes Consents, and the lenders party to the Transaction Support Agreement hold an aggregate principal amount of the Issuer’s outstanding loans and commitments under its existing credit facilities under its existing credit agreement, in each case, necessary to consent to the Other Transactions and the Exchange Offer and Consent Solicitation. By executing the Transaction Support Agreement, the lenders and noteholders party thereto agreed, among other things, to use commercially reasonable efforts to support and take all commercially reasonable actions necessary or reasonably requested by the Issuer to facilitate the consummation of the Other Transactions and the Exchange Offer and Consent Solicitation.

The following table sets forth the consideration offered in the Exchange Offer and Consent Solicitation Statement:

The Exchange Offer will expire at 11:59 p.m., New York City time, on March 7, 2025, unless extended or earlier terminated (the “Expiration Time”) by the Issuer. Eligible Holders that validly tender their Existing Notes and deliver their consents prior to 5:00 p.m., New York City time, on February 7, 2025 (the “Early Tender Time”), and do not validly withdraw their Existing Notes or validly revoke their consents prior to 5:00 p.m., New York City time, on February 7, 2025 (the “Withdrawal Deadline”), will receive the total consideration set out in the applicable column in the table above. Holders that validly tender their Existing Notes and deliver their consents after the Early Tender Time and on or before the Expiration Time will receive the exchange consideration set out in the applicable column in the table above. Validly tendered Existing Notes may not be withdrawn and consents may not be revoked after the Withdrawal Deadline, subject to limited exceptions.

The Issuer will settle all exchanges promptly after the Early Tender Time (the “Early Settlement Date”) and/or Expiration Time (the “Final Settlement Date”). The Early Settlement Date is expected to occur on February 12, 2025, three business days following the Early Tender Time, assuming the conditions to the Exchange Offer have either been satisfied or waived by the Issuer at or prior to the Expiration Time. The Final Settlement Date is expected to occur on March 12, 2025, three business days following the Expiration Time, assuming the conditions to the Exchange Offer have either been satisfied or waived by the Issuer at or prior to the Expiration Time.

In addition to the exchange consideration set out in the applicable column in the table above, Eligible Holders whose Existing Notes are accepted for exchange will receive a cash payment equal to the accrued and unpaid interest on such Existing Notes from and including the immediately preceding interest payment date for such Existing Notes to, but excluding, the Early Settlement Date. For the avoidance of doubt, accrued interest for such Existing Notes will cease to accrue on the Early Settlement Date for all Existing Notes accepted in the Exchange Offer and Eligible Holders whose Existing Notes are tendered after the Early Settlement Date and are accepted for purchase will not receive payment in respect of any interest for the period from and including the Early Settlement Date. Under no circumstances will any interest be payable because of any delay in the transmission of funds to Eligible Holders by DTC or its participants.

Holders delivering their consent pursuant to the Consent Only Option must deliver (and not validly revoke) their consents by 5:00 p.m., New York City time, on February 7, 2025, unless extended (such date and time, as the same may be extended, the “Consent Only Deadline”). Consents delivered in accordance with the Consent Only Option may be validly revoked at any time at or prior to the time and date on which the Supplemental Indenture is executed (the “Consent Time”) and may not be validly revoked at any time after the Consent Time, even if the Consent Only Deadline is later than the Consent Time. Holders who validly deliver consents pursuant to the Consent Only Option will not receive any payment or any Exchange Second-Out Notes through the Consent Solicitation.

The Exchange Second-Out Notes will mature on December 31, 2032. The Issuer will pay interest at a rate of 4.375% per annum. Interest on the Exchange Second-Out Notes will accrue from the date of original issuance and will be payable semi-annually in arrears on June 1 and December 1 of each year to the holders of record at the close of business on May 15 and November 15, whether or not a business day, prior to such interest payment date, provided that interest payable on the maturity date shall be payable to the person to whom principal shall be payable. The first interest payment date is June 1, 2025.

The Issuer’s obligations under the Exchange Second-Out Notes will be jointly and severally guaranteed, on a senior unsecured basis, by Sinclair Broadcast Group, Inc., the Issuer’s direct parent (“SBG”), and each wholly-owned subsidiary of the Issuer or SBG that guarantees the Issuer’s new credit agreement entered into upon consummation of the Other Transactions and the Exchange Offer.

The Exchange Offer is being made, and the Exchange Second-Out Notes are being offered and issued, only to holders of Existing Notes who are reasonably believed to be (i) “qualified institutional buyers” as defined in Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”) or (ii) not U.S. persons (as defined in Regulation S under the Securities Act) or purchasing for the account or benefit of U.S. persons, other than a distributor, and are purchasing the Exchange Second-Out Notes in an offshore transaction in accordance with Regulation S. The holders of Existing Notes who are eligible to participate in the Exchange Offer pursuant to the foregoing conditions are referred to as “Eligible Holders.” Only Eligible Holders are authorized to receive or review the Offering Documents or to participate in the Exchange Offer and Consent Solicitation.

J.P. Morgan Securities LLC will act as sole Dealer Manager for the Exchange Offer and Consent Solicitation.

The Offer Documents will be distributed only to holders of Existing Notes that complete and return a letter of eligibility confirming that they are Eligible Holders. Copies of the eligibility letter are available to holders through the information and exchange agent for the Exchange Offer and Consent Solicitation, Ipreo LLC, at (888) 593-9546 (U.S. toll-free) or (212) 849-3880 (Banks and Brokers) or ipreo-exchangeoffer@ihsmarkit.com.

The Exchange Offer and Consent Solicitation is made only by, and pursuant to the terms of, the Offer Documents, and the information in this news release is qualified by reference thereto.

This press release shall not constitute an offer to sell or the solicitation of an offer to exchange or purchase the Exchange Second-Out Notes, nor shall there be any offer or exchange of the Exchange Second-Out Notes in any state or jurisdiction in which such offer, solicitation or sale would be unlawful. In addition, this press release is neither an offer to exchange or purchase nor a solicitation of an offer to sell any Existing Notes in the Exchange Offer or a solicitation of consents to the Proposed Amendments, and this press release does not constitute a notice of redemption with respect to any securities.

The Exchange Second-Out Notes have not been and will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. Accordingly, the Exchange Second-Out Notes are being offered for exchange only to persons reasonably believed to be (i) “qualified institutional buyers” (as defined in Rule 144A under the Securities Act) or (ii) not U.S. persons (as defined in Regulation S under the Securities Act) or purchasing for the account or benefit of U.S. persons, other than a distributor, and are purchasing the Exchange Second-Out Notes in an offshore transaction in accordance with Regulation S.

Forward-Looking Statements:

The matters discussed in this news release, particularly those in the section labeled “Outlook,” include forward-looking statements regarding, among other things, the Other Transactions. When used in this news release, the words “outlook,” “intends to,” “believes,” “anticipates,” “expects,” “achieves,” “estimates,” and similar expressions are intended to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties. Actual results in the future could differ materially and adversely from those described in the forward-looking statements as a result of various important factors, including and in addition to the assumptions set forth therein, but not limited to, the occurrence of any event, change or other circumstance that could give rise to the termination of the Other Transactions or the Exchange Offer and/or Consent Solicitation, the ability to negotiate and reach agreement on definitive documentation relating to the Other Transactions or the Exchange Offer and/or Consent Solicitation, the ability to satisfy closing conditions to the completion of the Other Transactions or the Exchange Offer and/or Consent Solicitation; the Company’s ability to achieve the anticipated benefits from the Other Transactions and the Exchange Offer and/or Consent Solicitation; other risks related to the completion of the Other Transactions, the Exchange Offer or the Consent Solicitation and actions related thereto, the Company’s ability the rate of decline in the number of subscribers to services provided by traditional and virtual multi-channel video programming distributors (“Distributors”); the Company’s ability to generate cash to service its substantial indebtedness; the successful execution of outsourcing agreements; the successful execution of retransmission consent agreements; the successful execution of network and Distributor affiliation agreements; the Company’s ability to identify and consummate acquisitions and investments, to manage increased financial leverage resulting from acquisitions and investments, and to achieve anticipated returns on those investments once consummated; the Company’s ability to compete for viewers and advertisers; pricing and demand fluctuations in local and national advertising; the appeal of the Company’s programming and volatility in programming costs; material legal, financial and reputational risks and operational disruptions resulting from a breach of the Company’s information systems; the impact of FCC and other regulatory proceedings against the Company; compliance with laws and uncertainties associated with potential changes in the regulatory environment affecting the Company’s business and growth strategy; the impact of pending and future litigation claims against the Company; the Company’s limited experience in operating or investing in non-broadcast related businesses; and any risk factors set forth in the Company’s recent reports on Form 10-Q and/or Form 10-K, as filed with the Securities and Exchange Commission. There can be no assurances that the assumptions and other factors referred to in this release will occur. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements except as required by law.

Category: Financial

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