Neiman Marcus 2009 Annual Report Download - page 110

Table of Contents
$15.9 million reduction in our liability for unrecognized tax benefits resulted in a decrease to goodwill of $17.3 million and a tax
benefit of $1.3 million, offset by a decrease to deferred tax liabilities of $2.7 million during fiscal year 2009. Finally, in the fourth
quarter of fiscal year 2009, we recorded a decrease to our recorded liability for unrecognized tax benefits and a corresponding
reduction to goodwill of $0.7 million as a result of the expiration of statutes of limitation in various taxing jurisdictions.
As more fully described in Note 9, we recorded significant impairment charges in fiscal year 2009 to writedown our
tradenames and goodwill to estimated fair value.
NOTE 6. ACCRUED LIABILITIES
The significant components of accrued liabilities are as follows:
(in thousands)
July 31,
2010
August 1,
2009
Accrued salaries and related liabilities $ 68,845 $ 42,213
Amounts due customers 83,942 82,055
Self-insurance reserves 36,041 35,510
Interest payable 32,081 28,933
Sales returns reserves 25,167 22,874
Sales taxes 21,408 18,323
Loyalty program liability 16,913 16,927
Other 77,059 68,977
Total $ 361,456 $ 315,812
NOTE 7. LONG-TERM DEBT
The significant components of our long-term debt are as follows:
(in thousands) Interest Rate
July 31,
2010
August 1,
2009
Senior Secured Term Loan Facility variable $ 1,513,383 $ 1,625,000
2028 Debentures 7.125% 121,492 121,297
Senior Notes 9.0%/9.75% 752,445 734,541
Senior Subordinated Notes 10.375% 500,000 500,000
Total debt 2,887,320 2,980,838
Less: current portion of Senior Secured Term
Loan Facility (7,648)(26,617)
Long-term debt $ 2,879,672 $ 2,954,221
Senior Secured Asset-Based Revolving Credit Facility. NMG has an asset-based revolving credit facility with a committed
borrowing capacity of $600.0 million that matures on January 15, 2013. The facility also provides an uncommitted accordion feature
that allows NMG to request the lenders to provide additional capacity in either the form of increased revolving commitments or
incremental term loans, subject to a potential total maximum facility of $800 million.
Availability under the Asset-Based Revolving Credit Facility is subject to a borrowing base. The Asset-Based Revolving
Credit Facility includes borrowing capacity available for letters of credit and for borrowings on same-day notice. The borrowing base
for the Asset-Based Revolving Credit Facility is equal to at any time the sum of (a) the lesser of (i) 80% of eligible inventory (valued
at the lower of cost or market value) and (ii) 85% of the net orderly liquidation value of eligible inventory, and (b) 85% of the amounts
owed by credit card processors in respect of eligible credit card accounts constituting proceeds arising from the sale or disposition of
inventory, less certain reserves. Through April 30, 2011, NMG is required to maintain excess availability under the terms of the
Asset-Based Revolving Credit Facility of at least the greater of (a) 10% of the lesser of (i) the aggregate revolving commitments and
(ii) the borrowing base and (b) $50 million. After April 30, 2011, if at any time, excess availability is less than the greater of (a) 15%
of the lesser of (i) the aggregate revolving commitments
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