Dollar General 2015 Annual Report Download - page 104

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10-K
We have a five-year $1.425 billion unsecured credit agreement (the ‘‘Facilities’’), and we have
outstanding $2.3 billion aggregate principal amount of senior notes. At January 29, 2016, we had total
outstanding debt (including the current portion of long-term obligations) of $2.97 billion, which
includes balances under the Facilities, and senior notes, all of which are described in greater detail
below. We had $722.0 million available for borrowing under the Facilities at January 29, 2016. The
information contained in Note 5 to the consolidated financial statements under the heading ‘‘Borrowing
Facilities and 2015 Refinancing’’ contained in Part II, Item 8 of this report is incorporated herein by
reference. Cash and cash equivalents decreased by $421.9 million in 2015, primarily due to the
suspension of share repurchases during the portion of 2014 that coincided with our attempted
acquisition, resulting in higher than normal cash and cash equivalents balances at the end of 2014.
We believe our cash flow from operations and existing cash balances, combined with availability
under the Facilities as discussed in greater detail below and access to the debt markets will provide
sufficient liquidity to fund our current obligations, projected working capital requirements, capital
spending and anticipated dividend payments for a period that includes the next twelve months as well
as the next several years. However, our ability to maintain sufficient liquidity may be affected by
numerous factors, many of which are outside of our control. Depending on our liquidity levels,
conditions in the capital markets and other factors, we may from time to time consider the issuance of
debt, equity or other securities, the proceeds of which could provide additional liquidity for our
operations.
Facilities
On October 20, 2015, we consummated a refinancing pursuant to which we amended and restated
our senior unsecured credit facilities. The Facilities consist of a $425.0 million senior unsecured term
loan facility (the ‘‘Term Facility’’) and a $1.0 billion senior unsecured revolving credit facility (the
‘‘Revolving Facility’’) which provides for the issuance of letters of credit up to $175.0 million. The
Facilities are scheduled to mature on October 20, 2020.
Borrowings under the Facilities bear interest at a rate equal to an applicable interest rate margin
plus, at our option, either (a) LIBOR or (b) a base rate (which is usually equal to the prime rate). The
applicable interest rate margin for borrowings as of January 29, 2016 was 1.10% for LIBOR borrowings
and 0.10% for base-rate borrowings. We must also pay a facility fee, payable on any used and unused
commitment amounts of the Facilities, and customary fees on letters of credit issued under the
Revolving Facility. The applicable interest rate margins for borrowings, the facility fees and the letter of
credit fees under the Facilities are subject to adjustment from time to time based on our long-term
senior unsecured debt ratings. The weighted average all-in interest rate for borrowings under the
Facilities was 1.65% as of January 29, 2016.
The Facilities can be voluntarily prepaid in whole or in part at any time without penalty. There is
no required amortization under the Facilities. The Facilities contain a number of customary affirmative
and negative covenants that, among other things, restrict, subject to certain exceptions, the Company’s
and its subsidiaries ability to: incur additional liens; sell all or substantially all of our assets;
consummate certain fundamental changes or change in the Company’s lines of business; and incur
additional subsidiary indebtedness. The Facilities also contain financial covenants that require the
maintenance of a minimum fixed charge coverage ratio and a maximum leverage ratio. As of
January 29, 2016, we were in compliance with all such covenants. The Facilities also contain customary
events of default.
As of January 29, 2016, under the Revolving Facility, the Company had outstanding borrowings of
$251.0 million, standby letters of credit of $27.0 million, and borrowing availability of $722.0 million. In
addition, we had outstanding commercial letters of credit of $11.7 million.
30