IHOP 2012 Annual Report Download - page 97

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DineEquity, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
79
8. Long-Term Debt
Long-term debt consists of the following components:
2012 2011
(In millions)
Senior Secured Credit Facility, due October 2017, at a variable interest rate of 4.25% as of
December 31, 2012 and 2011..................................................................................................... $ 472.0 $ 682.5
Senior Notes due October 2018, at a fixed rate of 9.5% ............................................................ 760.8 765.8
Discount...................................................................................................................................... (23.3)(29.4)
Total debt.................................................................................................................................... 1,209.5 1,418.9
Less current maturities................................................................................................................ (7.4)(7.4)
Long-term debt ........................................................................................................................... $ 1,202.1 $ 1,411.4
Senior Secured Credit Facility
On October 8, 2010, the Company entered into a Credit Agreement, by and among the Company, a group of lenders and other
financial institutions party thereto (the "Credit Agreement"). The Credit Agreement established a senior secured credit facility (the
"Credit Facility") consisting of a $900.0 million senior secured term loan facility maturing in October 2017 (the "Term Facility")
and a $50.0 million senior secured revolving credit facility maturing in October 2015 (the "Revolving Facility"). The Revolving
Facility originally provided for borrowings up to $50.0 million, with sub-limits for the issuance of letters of credit and for swing-
line borrowings, and may be used for general corporate purposes, including working capital, permitted acquisitions, capital
expenditures, dividends and investments. The Credit Agreement also provides for an uncommitted incremental facility that permits
the Company, subject to certain conditions, to increase the Credit Facility by up to $250.0 million, provided that the aggregate
amount of the commitments under the Revolving Facility may not exceed $150.0 million. See "Amendment to Credit Agreement".
Interest Rate
Loans made under the Term Facility (“Term Loans”) and the Revolving Facility ("Revolving Loans") bear interest, at the
Company's option, at an annual rate equal to (i) a LIBOR-based rate (originally subject to a floor of 1.50%) plus a margin (originally
4.50%) or (ii) the base rate (the "Base Rate") (originally subject to a floor of 2.50%) which will be equal to the highest of (a) the
federal funds rate plus 0.50%, (b) the prime rate and (c) the one month LIBOR rate (originally subject to a floor of 1.50%) plus
1.00%, plus a margin of 3.50%. The margin for the Revolving Facility is subject to debt leverage-based step-downs. Both the
Term Facility and the Revolving Facility are subject to upfront fees of 1.00% of the principal amount thereof. See "Amendment
to Credit Agreement".
Amendment to Credit Agreement
On February 25, 2011, the Company entered into Amendment No. 1 (''Amendment No. 1'') to the Credit Agreement. Pursuant
to Amendment No. 1, the interest rate margin applicable to LIBOR-based Term Loans was reduced from 4.50% to 3.00%, and the
interest rate floors used to determine the LIBOR and Base Rate reference rates for Term Loans was reduced from 1.50% to 1.25%
for LIBOR-based Term Loans and from 2.50% to 2.25% for Base Rate-denominated Term Loans. In addition, Amendment No. 1
increased the lender commitments under the Revolving Facility from $50.0 million to $75.0 million. Amendment No. 1 also
modified certain restrictive covenants of the Credit Agreement, including those relating to repurchases of other debt securities,
permitted acquisitions and payments on equity. See Note 23, Subsequent Events.
The Company paid $12.3 million in fees and costs related to Amendment No. 1, of which $7.4 million in fees paid to lenders
was recorded as additional discount on debt and $0.8 million of costs related to the increase in the Revolving Facility was recorded
as deferred financing costs. Fees paid to third parties of $4.0 million were recorded as “Debt modification costs” in the Consolidated
Statement of Operations for the year ended December 31, 2011.