NOTES PAYABLE, FINANCE LEASES, AND COMMERCIAL BANK FINANCING |
3 Months Ended |
|---|---|
Mar. 31, 2026 | |
| Debt Disclosure [Abstract] | |
| NOTES PAYABLE, FINANCE LEASES, AND COMMERCIAL BANK FINANCING | 3. NOTES PAYABLE, FINANCE LEASES, AND COMMERCIAL BANK FINANCING: Credit Agreement and Notes Sinclair Television Group, Inc. (“STG”), a wholly-owned subsidiary of Sinclair Broadcast Group, LLC (“SBG”), is party to two bank credit agreements, the new credit agreement dated February 12, 2025 (the “New Credit Agreement”) and an existing credit agreement that was amended as of February 12, 2025 (the “Amended Credit Agreement). The New Credit Agreement includes a financial maintenance covenant, the first-out first lien leverage ratio (as defined in the New Credit Agreement), which requires such ratio not to exceed 3.5x, measured as of the end of each fiscal quarter, which is only applicable if 35% or more of the capacity (as a percentage of total commitments) under the $575 million first-out first lien revolving commitments (the “First-Out Revolving Credit Facility”), measured as of the last day of each fiscal quarter, is utilized as of such date. Since there was no utilization under the First-Out Revolving Credit Facility as of March 31, 2026, STG was not subject to the financial maintenance covenant under the New Credit Agreement. As of March 31, 2026, the STG first-out first lien leverage ratio was below 3.5x. The New Credit Agreement contains other restrictions and covenants with which STG was in compliance as of March 31, 2026. During the first quarter of 2025, STG completed a series of financing transactions and for the three months ended March 31, 2025, recognized a gain on extinguishment of the 4.125% Senior Secured Notes due 2030 and 5.125% Senior Notes due 2027 of $5 million and $3 million, respectively, and a loss on extinguishment of the Term Loan B-2 of $6 million. In April 2026, STG repurchased $93 million aggregate principal amount of the Term Loan B-6 and $72 million aggregate principal amount of the Term Loan B-7, both at discounts of face value. 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 $3 million as of both March 31, 2026 and December 31, 2025. Notes payable, finance leases, and commercial bank financing, less current portion, in our consolidated balance sheets includes finance leases to affiliates of $6 million as of both March 31, 2026 and December 31, 2025. See Note 8. Related Person Transactions. Debt of Variable Interest Entities and Guarantees of Third-Party Obligations We jointly, severally, unconditionally, and irrevocably guaranteed $2 million of debt of certain third parties as of December 31, 2025, all of which related to consolidated VIEs and was included in our consolidated balance sheets. We guarantee certain obligations of the Marquee Sports Network (“Marquee”) subject to a maximum aggregate amount of $331 million for the years 2026 through 2029. As of both March 31, 2026 and December 31, 2025, our estimated obligation was $15 million. Of this estimated obligation, the Company paid $5 million during the three months ended March 31, 2026 and $10 million during the year ended December 31, 2025. See Note 4. Commitments and Contingencies for further discussion. Accounts Receivable Securitization Facility On November 6, 2025, STG and one of its subsidiaries entered into a three-year, up to $375 million revolving accounts receivable securitization facility (the “AR Facility”) with Wells Fargo Bank, N.A., as administrative agent, which matures on November 6, 2028, in order to enable STG to raise incremental, low-cost capital. Amounts outstanding under the A/R Facility bear interest at SOFR plus 1.25%. The amount of actual availability under the A/R Facility is subject to change based on the level of eligible receivables sold by certain subsidiaries of STG identified therein (the “Originators”) to STG. Eligibility of the receivables is determined by a variety of factors, including, but not limited to, credit ratings of the Originators’ customers, customer concentration levels, and certain characteristics of the accounts receivable being transferred. The total amount outstanding under the A/R Facility was $375 million as of both March 31, 2026 and December 31, 2025. Interest expense related to the A/R Facility was $5 million for the three months ended March 31, 2026. Interest Rate Collar During the three months ended March 31, 2026, we entered into two interest collar agreements in order to manage a portion of our exposure to variable interest rates. The first agreement has a notional amount of $100 million, an effective date of March 3, 2026, a termination date of August 31, 2027, an interest rate ceiling of 3.75%, and an interest rate floor of 2.67%. The second agreement has a notional amount of $100 million, an effective date of March 30, 2026, a termination date of March 30, 2027, an interest rate ceiling of 4.25%, and an interest rate floor of 3.65%. The activity associated with these agreements was immaterial for the three months ended March 31, 2026.
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