Cash America 2015 Annual Report Download - page 112

Private Placement Notes
On May 9, 2014, the Company and its domestic subsidiaries, as guarantors, entered into an Omnibus
Waiver, Consent and Amendment Agreement (the “Waiver and Amendment”) with respect to its 6.09% Series A
senior unsecured notes due 2016, 7.26% senior unsecured notes due 2017, 6.00% Series A senior unsecured notes
due 2019, 6.21% Series B senior unsecured notes due 2021 and its 6.58% Series B senior unsecured notes due 2022
(collectively, the “Private Placement Notes”), which provided for the release of Enova and its subsidiaries as
guarantors of the Private Placement Notes upon completion of the issuance of debt by Enova. The Waiver and
Amendment also required the Company to prepay the entire outstanding balance of Private Placement Notes,
including any applicable make-whole premium. The Company completed the prepayment of the Private Placement
Notes in June 2014, which included an aggregate principal repayment of $106.2 million and a make-whole premium
of $14.3 million. Additionally, in conjunction with this prepayment, the Company recorded a $0.6 million expense
to write-off remaining deferred financing costs associated with the Private Placement Notes. The expenses for the
make-whole premium and the write-off of the deferred financing costs totaling $14.9 million are included in “Loss
on early extinguishment of debt” in the consolidated statements of income.
Debt Agreement Compliance
The debt agreements for the Line of Credit and the 2018 Senior Notes require the Company to maintain
certain financial ratios. AsofDecember31,2015,theCompanybelievesitwasincompliancewithallcovenantsor
other requirements set forth in the debt agreements.
On June 26, 2015, the Trustee under the 2018 Senior Notes Indenture, filed a lawsuit against the Company
in the United States District Court for the Southern District of New York. The lawsuit alleges that the Enova Spin-
off was not permitted by the 2018 Senior Notes Indenture, and the Trustee is seeking a remedy equal to principal
and accrued and unpaid interest, plus a make-whole premium, to be paid to the holders of the 2018 Senior Notes.
The Company disagrees with the assertion in the lawsuit that the Enova Spin-off was not permitted under the 2018
Senior Notes Indenture. The Company also disagrees that a make-whole premium would be due to the holders of
the 2018 Senior Notes even if it is determined that the Enova Spin-off was not permitted under the 2018 Senior
Notes Indenture. The Company believes the position taken by the Trustee is without merit, and the Company
intends to vigorously defend its position. Regardless of the outcome of this claim, the Company has ample liquidity
and capital resources to sustain its ongoing operations and to repay the 2018 Senior Notes, including any make-
whole premium on the 2018 Senior Notes, if such a premium were to be finally determined to be payable,
notwithstanding the Company’s belief that such a premium is not payable. The Company’s sources of liquidity
include availability under the Line of Credit, which had $252.9million in unused amounts as of December 31,
2015. AsofDecember31,2015,theCompanyhad$184.5millioninaggregateprincipalamountof2018Senior
Notesoutstanding,andamake-wholepremiumonsuchprincipalbalancesasofDecember31,2015wouldhave
been approximately $18.7 million.
CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
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