Cedar Fair obtains consent to amend and extend its credit agreement

Lenders holding $900 million of term debt will extend maturity date of commitments by two years.

Thursday, 06 August 2009

Cedar Fair Press Release

SANDUSKY, OHIO, August 6, 2009 -- Cedar Fair Entertainment Company (NYSE: FUN), a leader in regional amusement parks, water parks and active entertainment, today announced that it has received consent from its lenders to amend its credit agreement.  It also announced that lenders holding $900 million of its term debt will extend the maturity date of their commitments by two years.  The extended term debt will mature in 2014 and bears a rate of LIBOR plus 4.0%.

“Our lender group has been supportive of our business strategy, and we are pleased that we’ve received their consent to amend and extend our credit agreement,” said Dick Kinzel, Cedar Fair’s chairman, president and chief executive officer.  “The overall success of this transaction, including the ability to upsize the amount of the extended credit to $900 million, shows our lenders’ commitment and confidence in the long-term success of our business.”

The amendment will, among other things:

  • Allow for incurrence of secured debt (in the form of loans or bonds), with proceeds to repay existing term loans;
  • Allow for up to $150 million of sales/leasebacks, with 100% of net proceeds used to repay existing term loans ahead of extended term loans;
  • Allow for asset sales in aggregate of greater than $250 million in Fair Market Value, with 100% of net proceeds used to repay existing term loans ahead of extended term loans, and will include a revolving credit facility commitment reduction equal to 5% of the net proceeds upon such sale; and
  • Allow for additional offerings of credit extensions.

Other terms of the amendment include a reduction in the Company’s existing $345 million revolving credit facilities, including a $30 million reduction in its U.S. facility and a $5 million reduction in its Canadian facility.

“Improving our capital structure continues to be a priority for us,” added Kinzel.  “At the end of last year we had $1.7 billion in long-term debt which was set to mature within the next three years.  Since then, we have reduced our distribution rate, sold surplus land in Canada, and extended a significant portion of our term debt maturities.  Taking these items into consideration, along with our regular annual amortization payments, we have now proactively reduced our refinancing risk in 2012.  While these events have improved our capital structure, we will continue to monitor the markets for additional opportunities to reduce our leverage and strengthen our financial position over the long term.”

JPMorgan acted as sole lead arranger and sole bookrunner in connection with the amendment and extension.  The amendment and extension of the credit agreement will be subject to the satisfaction of customary closing conditions, and the Company expects it will be finalized shortly.
 
Cedar Fair is a publicly traded partnership headquartered in Sandusky, Ohio, and one of the largest regional amusement-resort operators in the world. The Company owns and operates 11 amusement parks, six outdoor water parks, one indoor water park and five hotels. Amusement parks in the Company’s northern region include two in Ohio: Cedar Point, consistently voted “Best Amusement Park in the World” in Amusement Today polls and Kings Island; as well as Canada’s Wonderland, near Toronto; Dorney Park, PA; Valleyfair, MN; and Michigan’s Adventure, MI.  In the southern region are Kings Dominion, VA; Carowinds, NC; and Worlds of Fun, MO.  Western parks in California include: Knott’s Berry Farm; California’s Great America; and Gilroy Gardens, which is managed under contract.