Avid 2015 Annual Report Download - page 99

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93
the amount repaid. The Term Loan requires quarterly principal payments of $1.25 million commencing in June 2016. The Term Loan
also requires the Company to use excess cash, as defined in the Financing Agreement, to repay outstanding principal.
The Company granted a security interest on substantially all of their assets to secure the obligations under the Credit Facility and the
Term Loan.
The Financing Agreement contains customary representations and warranties, covenants, mandatory prepayments, and events of
default under which the Company’s payment obligations may be accelerated. The Financing Agreement includes covenants requiring
the Company to maintain a Leverage Ratio (defined as the ratio of (a) consolidated total funded indebtedness to (b) consolidated
Adjusted EBITDA) of no greater than 4.35:1.00 for the four quarters ending June 30, 2016, 5.40:1.00 for the four quarters ending
September 30, 2016, 4.20:1.00 for the four quarters ending December 31, 2016 and thereafter declining over time from 3.50:1.00 to
2.50:1.00. The Financing Agreement also restricts the Company from making capital expenditures in excess of $20,000,000 in any
fiscal year.
The Financing Agreement contains restrictive covenants that are customary for an agreement of this kind, including, for example,
covenants that restrict the Company from incurring additional indebtedness, granting liens, making investments and restricted
payments, making acquisitions, paying dividends and engaging in transactions with affiliates.
S. QUARTERLY RESULTS (UNAUDITED)
The following information has been derived from unaudited consolidated financial statements that, in the opinion of management,
include all normal recurring adjustments necessary for a fair presentation of such information.
(In thousands, except per share data)
Quarter Ended
2015 2014
Dec. 31 Sept. 30 June 30 Mar. 31 Dec. 31 Sept. 30 June 30 Mar. 31
Net revenues $138,806 $137,436 $109,767 $119,586 $128,196 $142,429 $124,644 $134,982
Cost of revenues 54,912 47,672 43,306 47,492 50,548 52,788 50,420 50,665
Amortization of intangible assets 1,950 1,950 163 — — — — 50
Gross profit 81,944 87,814 66,298 72,094 77,648 89,641 74,224 84,267
Operating expenses:
Research and development 24,190 25,225 23,310 23,173 23,212 22,154 22,070 22,954
Marketing and selling 30,091 31,564 32,811 28,045 34,527 31,410 34,297 32,815
General and administrative 21,463 15,834 17,425 19,387 22,222 20,644 19,984 18,331
Amortization of intangible assets 786 786 408 374 375 373 398 480
Restructuring costs (recoveries), net 5,766 — 539 — — — (165) —
Total operating expenses 82,296 73,409 74,493 70,979 80,336 74,581 76,584 74,580
Operating (loss) income (352) 14,405 (8,195) 1,115 (2,688) 15,060 (2,360) 9,687
Other expense, net (1,727) (2,519) (1,439) (723) (1,620) (455) (357) (351)
(Loss) income before income taxes (2,079) 11,886 (9,634) 392 (4,308) 14,605 (2,717) 9,336
Provision for (benefit from) income taxes 2,306 768 (5,550) 561 761 365 622 440
Net (loss) income $ (4,385) $ 11,118 $ (4,084) $ (169) $ (5,069) $ 14,240 $ (3,339) $ 8,896
Net (loss) income per share – basic and diluted $ (0.11) $ 0.28 $ (0.10) $ 0.00 $ (0.13) $ 0.36 $ (0.09) $ 0.23
Weighted-average common shares outstanding – basic 39,439 39,231 39,635 39,387 39,234 39,133 39,119 39,099
Weighted-average common shares outstanding – diluted 39,439 39,750 39,635 39,387 39,234 39,201 39,119 39,122