Henry Schein 2014 Annual Report Download - page 90

HENRY SCHEIN, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)
(in thousands, except per share data)
76
Note 5 – Debt – (Continued)
Private Placement Facilities
On August 10, 2010, we entered into $400 million private placement facilities with two insurance companies.
On April 30, 2012, we increased our available credit facilities by $375 million by entering into a new agreement
with one insurance company and amending our existing agreements with two insurance companies. On September
22, 2014, we increased our available private placement facilities by $200 million to a total facility amount of $975
million, and extended the expiration date to September 22, 2017. These facilities are available on an uncommitted
basis at fixed rate economic terms to be agreed upon at the time of issuance, from time to time through September
22, 2017. The facilities allow us to issue senior promissory notes to the lenders at a fixed rate based on an agreed
upon spread over applicable treasury notes at the time of issuance. The term of each possible issuance will be
selected by us and can range from five to 15 years (with an average life no longer than 12 years). The proceeds of
any issuances under the facilities will be used for general corporate purposes, including working capital and capital
expenditures, to refinance existing indebtedness and/or to fund potential acquisitions. The agreements provide,
among other things, that we maintain certain maximum leverage ratios, and contain restrictions relating to
subsidiary indebtedness, liens, affiliate transactions, disposal of assets and certain changes in ownership. These
facilities contain make-whole provisions in the event that we pay off the facilities prior to the applicable due dates.
The components of our private placement facility borrowings as of December 27, 2014 are presented in the
following table:
  Amount of   
 Borrowing Borrowing
Date of Borrowing Outstanding Rate Due Date
September 2, 2010  $100,000 3.79 % September 2, 2020
January 20, 2012  50,000 3.45 January 20, 2024
January 20, 2012 (1)  50,000 3.09 January 20, 2022
December 24, 2012  50,000 3.00 December 24, 2024
June 2, 2014  100,000 3.19 June 2, 2021
  $350,000   
(1) Annual repayments of approximately $7.1 million for this borrowing will commence on January 20, 2016.
U.S. Trade Accounts Receivable Securitization
On April 17, 2013, we entered into a facility agreement of up to $300 million with a bank, as agent, based on
the securitization of our U.S. trade accounts receivable. The new facility allowed us to replace public debt
(approximately $220 million), which had a higher interest rate at Henry Schein Animal Health (“HSAH”) during
February 2013 and provided funding for working capital and general corporate purposes. The financing was
structured as an asset-backed securitization program with pricing committed for up to three years. On September
22, 2014, we extended the expiration date of this facility agreement to April 15, 2017. The borrowings outstanding
under this securitization facility were $150.0 million as of December 27, 2014. At December 27, 2014, the interest
rate on borrowings under this facility was based on the average asset-backed commercial paper rate of 20 basis
points plus 75 basis points, for a combined rate of 0.95%.
We are required to pay a commitment fee of 30 basis points on the daily balance of the unused portion of the
facility if our usage is greater than or equal to 50% of the facility limit or a commitment fee of 35 basis points on
the daily balance of the unused portion of the facility if our usage is less than 50% of the facility limit.