Einstein Bros 2008 Annual Report Download - page 49

Form 10-K
http://www.sec.gov/Archives/edgar/data/949373/000119312509042707/d10k.htm[9/11/2014 10:10:56 AM]
Accrued senior management transition costs
—
1,297
Deferred gift card revenue 1,643 1,415
Other current liabilities 1,302 1,511
Total accrued expenses and other current liabilities $ 19,279 $ 22,410
62
Table of Contents
EINSTEIN NOAH RESTAURANT GROUP, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
9. SENIOR NOTES AND OTHER LONG-TERM DEBT
Senior notes and other long-term debt consist of the following as of:
January 1,
2008
December 30,
2008
(in thousands of dollars)
$90 Million Amended First Lien Term Loan $ 89,550 $ 87,875
New Jersey Economic Development Authority Note Payable 280 —
Total senior notes and other debt, net of discount $ 89,830 $ 87,875
Less short-term debt and current portion of long-term debt 955 8,088
Senior notes and other long-term debt, net of discount $ 88,875 $ 79,787
June 2007 Debt Redemption and Amended First Lien Term Loan
On June 13, 2007, we completed a $90 million secondary public offering of 5 million shares of our common stock. After stock issuance costs of
$6.7 million related to the offering, we received net proceeds of $83.3 million. The net proceeds were used to repay our $65.0 million Second Lien
Term Loan, repay a portion of our $25 million Subordinated Note held by Greenlight Capital, L.L.C. (“Greenlight”) and to pay for the offering
costs. Additionally, on June 28, 2007, we repaid the remaining portion of the $25 million subordinated note held by Greenlight by using a portion
of the incremental debt proceeds under our amended debt facility.
Our debt is composed of a modified term loan with a principal amount of $90 million and a $20 million revolving credit facility. We may prepay
amounts outstanding under the senior secured credit facility and may terminate commitments in whole at any time without penalty or premium
upon prior written notice. Both the revolving credit facility and the term loan facility have a five-year term and are secured by substantially all of
our assets and guaranteed by our subsidiaries. Borrowings under this senior secured credit facility bear interest at a rate equal to an applicable
margin plus, at our option, either a variable base rate or a Eurodollar rate. As of December 30, 2008, the weighted-average interest rate under the
$90 million First Lien Term Loan (“First Lien Term Loan”) was 2.65%. The revolving facility and the First Lien Term Loan contain usual and
customary covenants including consolidated leverage ratios, fixed charge coverage ratios, limitations on capital expenditures, etc. As of January 1,
2008 and December 30, 2008 we were in compliance with all our financial and operating covenants.
Letters of credit reduce our availability under our revolving facility. As of December 30, 2008, we had $7.0 million in letters of credit outstanding
under this facility. The letters of credit expire on various dates during 2009, are automatically renewable for one additional year and are payable
upon demand in the event that we fail to pay the underlying obligation. Our availability under the revolving facility was $13.0 million as of
December 30, 2008.
The term loan requires mandatory prepayments of:
• 50% of excess cash flow (as defined in the senior secured credit facility) subject to the ability to retain at least $5 million in cash and
cash equivalents;
• 100% of net cash proceeds of asset sales by us above a threshold and subject to the ability to reinvest under certain circumstances;
• 100% of net cash proceeds of any debt issued by us, subject to certain exceptions; and
• 50% of the net cash proceeds of any equity issued by us, subject to certain exceptions.
63
Table of Contents