GNC 2011 Annual Report Download - page 100

Table of Contents
NOTE 12. LONG-TERM DEBT / INTEREST (Continued)
Accrued interest at each respective period consisted of the following:
December 31,
2010 2009
(in thousands)
Senior Credit Facility $ 4,173 $ 5,350
Senior Notes 5,717 5,720
Senior Subordinated Notes 3,482 3,482
Total $ 13,372 $ 14,552
Description of Debt:
Senior Credit Facility. The Senior Credit Facility consists of a $675.0 million Term Loan Facility and a $60.0 million revolving credit facility (the
"Revolving Credit Facility"). The Term Loan Facility will mature in September 2013. The Revolving Credit Facility will mature in March 2012. The Senior
Credit Facility permits the Company to prepay a portion or all of the outstanding balance without incurring penalties (except LIBOR breakage costs). Subject
to certain exceptions, the credit agreement requires that 100% of the net cash proceeds from certain asset sales, casualty insurance, condemnations and debt
issuances, and a specified percentage (ranging from 50% to 0% based on a defined leverage ratio) of excess cash flow (as defined in the agreement) for each
fiscal year must be used to pay down outstanding borrowings. GNC Corporation, the Company's direct parent company ("GNC Corporation"), and the
Company's existing and future direct and indirect domestic subsidiaries have guaranteed the Company's obligations under the Senior Credit Facility. In
addition, the Senior Credit Facility is collateralized by first priority pledges (subject to permitted liens) of the Company's equity interests and the equity
interests of the Company's domestic subsidiaries.
All borrowings under the Senior Credit Facility bear interest, at the Company's option, at a rate per annum equal to (i) the higher of (x) the prime rate
(as publicly announced by JP Morgan Chase Bank, N.A. as its prime rate in effect) and (y) the federal funds effective rate, plus 0.50% per annum plus, at
December 31, 2010, applicable margins of 1.25% per annum for the Term Loan Facility and 0.75% per annum for the Revolving Credit Facility or
(ii) adjusted LIBOR plus 2.25% per annum for the term loan facility and 1.75% per annum for the Revolving Credit Facility. In addition to paying interest on
outstanding principal under the Senior Credit Facility, the Company is required to pay a commitment fee to the lenders under the Revolving Credit Facility in
respect of unutilized revolving loan commitments at a rate of 0.50% per annum. The Company pays interest on outstanding borrowings on the Revolving
Credit Facility at a Eurodollar rate or Adjusted Base Rate ("ABR") plus the applicable margin in effect. As of December 31, 2010 and 2009, the ABR was
4.00% and 4.25%, respectively.
The Company issues letters of credit as a guarantee of payment to third-payment vendors in accordance with specified terms and conditions. It also
issues letters of credit for various insurance contracts. The Revolving Credit Facility allows for $25.0 million of the $60.0 million Revolving Credit Facility to
be used as collateral for outstanding letters of credit. As of December 31, 2010 and 2009, $8.8 million and $7.9 million, respectively, of the Revolving Credit
Facility was utilized to secure letters of credit.
The Senior Credit Facility contains customary covenants, including incurrence covenants and certain other limitations on the ability of GNC
Corporation, the Company, and its subsidiaries to
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