Einstein Bros 2003 Annual Report Download - page 42

http://www.sec.gov/Archives/edgar/data/949373/000104746904009609/a2132006z10-k.htm[9/11/2014 10:13:55 AM]
the current reporting system and determining the appropriate operating metrics for our business, which will be monitored and reported on in the
future.
We are a Delaware corporation and were organized in November 1992.
2003 Debt Refinancing and Equity Recapitalization
On July 8, 2003, we issued in a private placement $160.0 million of 13% senior secured notes due 2008 ("$160 Million Facility") to replace
the private placement of 140,000 units consisting of $140 million of senior secured increasing rate notes (the "$140 Million Facility"). The $160
Million Facility was offered by the Company and guaranteed, jointly and severally, by all present and all future subsidiaries of the Company other
than the Non-Restricted Subsidiaries (as defined in the Indenture governing the notes). We used the net proceeds of the offering, among other
things, to refinance the $140 Million Facility. In November 2003, we exchanged the original notes issued in the $160 Million Facility for notes that
were registered with the Securities and Exchange Commission pursuant to a registration statement on Form S-4.
On July 8, 2003, we entered into a three-year, $15 million senior secured revolving credit facility with AmSouth Bank ("AmSouth Revolver"),
which was amended to make technical corrections and to clarify ambiguous terms on December 30, 2003.
On June 26, 2003, our board of directors approved an equity restructuring agreement ("Equity Recap") between us and the holders of all our
preferred stock and a substantial portion of our fully diluted common stock. These entities were:
•Greenlight Capital, L.P. ("Greenlight Capital");
•Greenlight Capital Qualified, L.P. ("Greenlight Qualified");
•Greenlight Capital Offshore, Ltd. ("Greenlight Offshore");
•Brookwood New World Investors, L.L.C. ("Brookwood"); and,
•NWCI Holdings, LLC ("NWCI").
These entities are collectively referred to as Greenlight in this filing. Additionally, we also agreed to the Equity Recap with Halpern Denny
Fund III, L.P. ("Halpern Denny"). Certain of these entities also held a portion of the $140 Million Facility.
F-8
On September 24, 2003, our stockholders approved the Equity Recap, which included the following transactions:
•we issued Halpern Denny 57,000 shares of Series Z Preferred Stock, par value $0.001 per share ("Series Z") in exchange for
56,237.994 shares of Series F, par value $0.001 per share ("Series F") (including accrued and unpaid dividends, which were payable
in additional shares of Series F), 23,264,107 shares of common stock and warrants to purchase 13,711,054 shares of common stock
(collectively, the "Halpern Denny Interests"); and
•each stockholder received 0.6610444 new shares of common stock for every share of common stock held by such stockholder
pursuant to a 1.6610444-for-one forward stock split in order to effect the transactions contemplated by the Equity Recap;
•the per share exercise price and the number of shares of common stock issuable upon the exercise of each outstanding option or
warrant (other than the warrants that were issued in connection with the $140 Million Facility pursuant to the Warrant Agreement
dated June 19, 2001, as amended between The Bank of New York, as warrant agent and us (the "Warrant Agreement")) were
adjusted to reflect the forward stock split;
•immediately following the forward stock split, but before the one-for-one hundred reverse stock split discussed below, we issued
Greenlight 938,084,289 shares of common stock in exchange for 61,706.237 shares of Series F. These shares of Series F included
i) shares originally issued as Series F, ii) shares converted into Series F from the $10 million contribution plus accrued interest
resulting from the Bond Purchase Agreement ("Greenlight Obligation") and iii) shares converted into Series F from the Bridge
Loan (which was acquired by Greenlight from Jefferies & Company, Inc.).
Following the closing of the Equity Recap, Greenlight beneficially owned approximately 92% of our common stock on a fully diluted basis
and warrants issued pursuant to the Warrant Agreement represented approximately 4.3% of our common stock on a fully diluted basis.