Lumber Liquidators 2015 Annual Report Download - page 72

Lumber Liquidators Holdings, Inc.
Notes to Consolidated Financial Statements
(amounts in thousands, except share data and per share amounts)
Note 3. Other Current Liabilities
Other current liabilities consisted of:
December 31,
2015 2014
Accrued Legal and Settlement Expense ......................... $14,011 $ 2,087
Other ................................................ 14,744 15,749
Other Current Liabilities, net .............................. $28,755 $17,836
Note 4. Revolving Credit Agreement
On April 24, 2015, the Company, exclusive of the non-domestic subsidiaries, entered into a Second
Amended and Restated Credit Agreement (as amended on May 21, 2015 and November 20, 2015, the ‘‘Credit
Agreement’’) with Bank of America, N.A. as administrative agent, collateral agent and lender (the ‘‘Bank’’).
The Credit Agreement amended and restated the Amended and Restated Credit Agreement that was entered
into between Lumber Liquidators, Inc. and the Bank on February 21, 2012 and amended on March 27, 2015.
Under the Credit Agreement, the Bank agreed to provide the Company with an asset-based revolving credit
facility (the ‘‘Revolving Credit Facility’’) under which the Company may obtain loans and letters of credit
from the Bank up to a maximum aggregate outstanding principal amount of the lesser of $100,000 or a
calculated borrowing base. Letters of credit are subject to a sublimit of $20,000 (subject to the borrowing
base). The Credit Agreement expires on April 24, 2020, is guaranteed by the Company and certain of its
domestic subsidiaries and is secured primarily by the Company’s inventory, including certain in-transit
inventory, and credit card receivables.
The Revolving Credit Facility has no mandated payment provisions and a fee of 0.15% per annum on
any unused portion, paid quarterly in arrears. Loans outstanding under the Revolving Credit Facility can bear
interest based on the Base Rate or the LIBOR Rate, each as defined in the Credit Agreement. Interest on Base
Rate loans is charged at varying per annum rates computed by applying a margin ranging from 0.125% to
0.375% (dependent on the Company’s average daily excess borrowing availability during the most recently
completed fiscal quarter) over the applicable base interest rate (defined as the greatest of the prime rate, a
specified federal funds rate plus 0.50%, or the one-month LIBOR Rate plus 1.00%). Interest on LIBOR Rate
loans and fees for standby letters of credit are charged at varying per annum rates computed by applying a
margin ranging from 1.125% to 1.375% (dependent on the Company’s average daily excess borrowing
availability during the most recently completed fiscal quarter) over the applicable LIBOR rate for one, two,
three or six month interest periods as selected by the Company. At December 31, 2015, the applicable interest
rate for outstanding borrowings was 1.4375%. For the year ended December 31, 2015, the Company paid cash
for interest in the amount of $237.
The Credit Agreement contains a fixed charge coverage ratio covenant that becomes effective in the event
that the Company’s excess borrowing availability under the Revolving Credit Facility at any time during the
term of the Revolving Credit Facility falls below the greater of $10,000 or 10% of the borrowing base.
At December 31, 2015, the Company had $67,200 available to borrow under the Revolving Credit
Facility and $20,000 in outstanding borrowings and supported approximately $2,800 and $2,700 of letters of
credit at December 31, 2015 and 2014, respectively.
Note 5. Leases
The Company has operating leases for its stores, Corporate Headquarters and West Coast distribution
center, supplemental office facilities and certain equipment. The store location leases are operating leases and
generally have five-year base periods with one or more five-year renewal periods. The Corporate Headquarters
has an operating lease with a base term running through December 31, 2019. The West Coast distribution
center has an operating lease with a base term running through October 31, 2024.
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