Panera Bread 2013 Annual Report Download - page 64

PANERA BREAD COMPANY
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
56
10. Accrued Expenses
Accrued expenses consisted of the following (in thousands):
December 31,
2013
December 25,
2012
Unredeemed gift cards, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 86,287 $ 78,587
Compensation and related employment taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,123 58,751
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41,329 25,135
Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,545 28,903
Taxes, other than income tax. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,618 18,224
Fresh dough and other product operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,236 8,175
Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,729 8,526
Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,488 4,255
Occupancy costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,017 5,986
Loyalty program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,362 4,667
Deferred revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,852 2,775
Deferred acquisition purchase price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270 4,111
Litigation settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 3,729
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,936 16,345
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 285,792 $ 268,169
11. Credit Facility
On November 30, 2012, the Company terminated the Amended and Restated Credit Agreement, dated March 7, 2008, by and
among the Company, Bank of America, N.A., and other lenders party thereto (the "Prior Credit Agreement"). As of the date of
termination, the Company had no loans outstanding and was in compliance with all covenants under the Prior Credit Agreement.
On November 30, 2012, the Company entered into a new credit agreement (the “Credit Agreement”) with Bank of America, N.A.
and other lenders party thereto. The Credit Agreement provides for an unsecured revolving credit facility of $250 million and
provides that the Company may select the interest rates under the credit facility equal to (1) LIBOR plus the Applicable Rate for
LIBOR loans (which is an amount ranging from 1.00 percent to 2.00 percent depending on the Company’s consolidated leverage
ratio) or (2) the Base Rate (which is defined as the higher of the Bank of America prime rate, the Federal funds rate plus 0.50
percent, or LIBOR plus 1.00 percent) plus the Applicable Rate for Base Rate loans (which is an amount ranging from 0.00 percent
to 1.00 percent depending on the Company's consolidated leverage ratio). The Company also pays commitment fees for the unused
portion of the credit facility on a quarterly basis equal to the Applicable Rate for commitment fees times the actual daily unused
commitment for that calendar quarter. The Applicable Rate for commitment fees is between 0.10 percent and 0.25 percent based
on the Company’s Consolidated Leverage Ratio.
The Credit Agreement includes usual and customary covenants for a credit facility of this type, including covenants limiting liens,
dispositions, fundamental changes, investments, indebtedness, and certain transactions and payments. In addition, the Credit
Agreement also requires the Company satisfy two financial covenants at the end of each fiscal quarter for the previous four
consecutive fiscal quarters: (1) a consolidated leverage ratio less than or equal to 3.00 to 1.00, and (2) a consolidated fixed charge
coverage ratio of greater than or equal to 2.00 to 1.00. The credit facility, which is collateralized by the capital stock of the
Company’s present and future material subsidiaries, will become due on November 30, 2017, subject to acceleration upon certain
specified events of default, including breaches of representations or covenants, failure to pay other material indebtedness or a
change of control of the Company, as defined in the Credit Agreement.
The Credit Agreement allows the Company from time to time to request that the credit facility be further increased by an amount
not to exceed, in the aggregate, $150 million, subject to the arrangement of additional commitments with financial institutions
acceptable to the Company and Bank of America. The Company has not exercised these requests for increases in available
borrowings as of December 31, 2013. The proceeds from the credit facility are expected to be used for general corporate purposes.
As of December 31, 2013 and December 25, 2012 the Company had no loans outstanding under the Credit Agreement. The
Company incurred $0.3 million of commitment fees for the fiscal year ended December 31, 2013, and $0.4 million for both of
the fiscal years ended December 25, 2012, and December 27, 2011, respectively. As of December 31, 2013 and December 25,