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SECURED LINE OF CREDIT
 9 Months Ended
Dec. 31, 2025
SECURED LINE OF CREDIT  
SECURED LINE OF CREDIT

NOTE 8. SECURED LINE OF CREDIT

Long-term debt consists of the following:

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December 31, 

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March 31, 

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2025

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2025

Secured line of credit

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$

455,828,410

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$

391,828,410

Debt issuance costs, net

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(3,569,076)

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(3,693,656)

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$

452,259,334

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$

388,134,754

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Credit Facilities

RMM is party to a credit agreement (as amended or supplemented from time to time, the “RMM Credit Agreement”) governing RMM’s senior secured revolving credit facility (the “Senior Credit Facility”). On June 3, 2025, RMM entered into an amendment (the “Third Amendment”) to the RMM Credit Agreement, which amended the Senior Credit Facility to (i) increase the revolving credit commitment from $450,000,000 to $550,000,000, (ii) adjust the consolidated net senior debt to the value of the music library ratio from 30.0% to 37.5% for the 0.25% increase in the pricing grid, (iii) reset the incremental borrowing capacity under the facility’s accordion feature to $150,000,000 after the effectiveness of the Third Amendment, (iv) exclude non wholly-owned foreign subsidiaries from the requirement to guarantee obligations under the RMM Credit Agreement and (v) modify certain negative covenants under the RMM Credit Agreement as further set forth in the Third Amendment. In connection with the Third Amendment, the Company incurred banking, legal and consulting fees of $1,140,259 that were recorded as deferred financing fees, which will be amortized over the remaining term of the Senior Credit Facility.

The maturity date of the loans advanced under the Senior Credit Facility is December 16, 2027. The interest rate on borrowings under the Senior Credit Facility is equal to, at the Company’s option, either (i) the sum of a base rate plus a margin of 1.00% or (ii) the sum of a Secured Overnight Financing Rate (“SOFR”) rate plus a margin of 2.00%, in each case subject to a 0.25% increase based on a consolidated net senior debt to library value ratio. RMM is also required to pay an unused fee in respect of unused commitments under the Senior Credit Facility, if any, at a rate of 0.25% per annum. Substantially all tangible and intangible assets of the Company, RHI, RMM and the other subsidiary guarantors are pledged as collateral to secure the obligations of RMM under the RMM Credit Agreement.

The RMM Credit Agreement contains customary covenants limiting the ability of the Company, RHI, RMM and certain of its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, make investments, make cash dividends, redeem or repurchase capital stock, dispose of assets, enter into transactions with affiliates or enter into certain restrictive agreements. In addition, the Company, on a consolidated basis with its subsidiaries, must comply with financial covenants requiring the Company to maintain (i) a fixed charge coverage ratio of not less than 1.10:1.00 for each four fiscal quarter period, and (ii) a consolidated senior debt to library value ratio of 0.45:1.00, subject to certain adjustments. If RMM does not comply with the covenants in the RMM Credit Agreement, the lenders may, subject to customary cure rights, require the immediate payment of all amounts outstanding under the Senior Credit Facility.

As described above, the Senior Credit Facility also includes an “accordion feature” that permits RMM to seek additional commitments in an amount not to exceed $150,000,000. As of December 31, 2025, the Senior Credit Facility had a borrowing capacity of $550,000,000, with remaining borrowing availability of $94,171,590.

Interest Rate Swaps

At December 31, 2025, RMM had the following interest rate swaps outstanding, under which it pays a fixed rate and receives a floating interest payment from the counterparty based on SOFR:

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Notional 

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Amount at 

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December 31, 

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Pay Fixed 

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Effective Date

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2025

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Rate

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Maturity

September 30, 2024

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$

100,000,000

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2.946

%

December 2027

September 30, 2024

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$

50,000,000

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3.961

%  

December 2027

September 4, 2025

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$

65,000,000

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3.405

%  

December 2027

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In September 2025, the Company entered into an interest rate swap in the amount of $65,000,000, which is reflected in the table above. This swap had an effective date of September 4, 2025 and has a maturity date of December 16, 2027, which corresponds to the maturity date of the Senior Credit Facility. The Company pays a fixed rate of 3.405% and receives a floating interest from the counterparty based on SOFR.

On September 30, 2024, three previous interest rate swaps expired with original notional amounts of $8,875,000, $88,098,862 and $53,030,237. Through the expiration date of these previous interest rate swaps, RMM paid fixed rates of 1.53%, 1.422% and 0.972%, respectively, to the counterparty and received a floating interest payment from the counterparty based on SOFR.