Einstein Bros 2013 Annual Report Download - page 35

10-K
http://www.sec.gov/Archives/edgar/data/949373/000119312514073832/d629623d10k.htm[9/11/2014 10:05:27 AM]
Average rent expense capitalized at 8 times plus cash investment cost of $556,000.
Cash Flow Through On A Per Store Basis
Fiscal Year Ended
December 31, 2013
Company-Owned Licensed Franchised
(in thousands)
Average unit volume $ 874 $ 460 $ 895
Contribution margin % (1) (2) 18.5% 6.5% 5.0%
Contribution margin $ 162 $ 30 $ 45
Cash investment $ 556 $— $—
Upfront fee $— $ 12.5 $ 35
(1) Reflects contribution margin for company-owned restaurants open for greater than one year and weighted average royalty rate of system for
license and franchise.
(2) Franchisees also contribute 4.0% of sales for marketing activities which equates to an average of $36,000 per location.
(3) Only reflects Einstein Bros.
Senior Credit Facility
As previously discussed, in December 2012, we entered into an amended and restated senior credit facility with Bank of America and a
syndicate of institutional lenders, which was further amended in June 2013.
The Senior Credit Facility consists of a:
• $75.0 million revolving credit facility maturing on June 6, 2018; and
• $100.0 million first lien term loan maturing June 6, 2018.
We may prepay amounts outstanding under the Senior Credit Facility and may terminate commitments in whole at any time without penalty
or premium upon prior written notice.
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In addition, the Senior Credit Facility provides for (i) an incremental term loan (the “Incremental Term Loan”) and (ii) an increase in the
revolver (the “Revolving Facility Increase” and together with the Incremental Term Loan, the “Incremental Facilities”) of up to $50 million to be
used by us, if needed, solely for the purpose of making acquisitions permitted under the Senior Credit Facility. If we choose to draw down the
Incremental Facilities, the outstanding amount of the Incremental Facilities must be repaid in equal quarterly installments on the last day of each
calendar quarter, with any remaining amounts due and payable on June 6, 2018. Availability of the Incremental Facilities is subject to customary
borrowing conditions, including the absence of any default or material adverse change, and to a requirement of advanced successful syndication of
the Incremental Facilities.
A portion of the revolver remains available, subject to certain conditions, to finance our ongoing working capital, capital expenditure and
general corporate needs. In addition, $20.0 million of the revolver is available for letters of credit, which reduce the availability on the line. As of
December 31, 2013, our availability under the revolver was $56.3 million.
Working Capital
Our working capital position decreased by $7.8 million in fiscal 2013. We began fiscal 2013 with working capital of $5.4 million and ended
fiscal 2013 with negative working capital of $2.4 million.
January 1, December 31,
2013 2013 Change
(in thousands)
Current assets:
Cash and cash equivalents $ 17,432 $ 5,982 $(11,450)
Restricted cash 998 1,287 289
Accounts receivable 9,024 9,875 851
Inventories 5,382 5,634 252
Current deferred income tax assets, net 8,190 9,920 1,730
Prepaid expenses 7,059 7,252 193
Other current assets 661 682 21
(3)