Circuit City 2005 Annual Report Download - page 56

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The weighted average interest rate on short
-
term borrowings was 6.4% in 2005, 6.0% in 2004 and 5.2% in 2003.
6.
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Accrued expenses and other current liabilities consist of the following (in thousands):
2005
2004
Payroll and employee benefits
$
$
14,493
Income taxes payable
6,819
6,397
Other
38,749
$
$
59,639
7.
LONG
-
TERM DEBT
Long
-
term debt consists of (in thousands):
2005
2004
Mortgage note payable (a)
$
7,803
$
8,012
Term loan payable (b)
--
9,713
Capitalized equipment lease obligations
799
1,185
8,602
18,910
Less: current portion
574
10,271
$
8,028
$
8,639
(a) Mortgage note payable. The Company had a ten year, $8.4 million mortgage loan on its Georgia
distribution facility. The mortgage had monthly principal and interest payments of $62,000 through May
2012, with a final additional principal payment of $6.4 million at maturity in May 2012. The mortgage bore
interest at 7.04% and was collateralized by the underlying land and building. In March 2006, the Company
sold its Georgia distribution facility and repaid the remaining balance on the mortgage (see Note 14).
(b)
Term loan payable. The Company had a term loan agreement which was used to finance the construction of
its United Kingdom facility and which was secured by the underlying land and building. The loan was
repaid in November 2005 in connection with the amendment and restatement of the Company’s revolving
credit facility. The term loan agreement contained certain financial and other covenants related to the
Company’s United Kingdom subsidiaries, with which the Company was not in compliance as of December
31, 2004. As a result, the Company classified the entire obligation as current as of December 31, 2004.
The aggregate maturities of long
-
term debt outstanding at December 31, 2005 are as follows (in thousands):
2006
2007
2008
2009
2010
After
2010
Maturities
$574
$505
$348
$241
$258
8.
RESTRUCTURING AND OTHER CHARGES
The Company periodically assesses its operations to ensure that they are efficient, aligned with market conditions
and responsive to customer needs. During the years ended December 31, 2005, 2004 and 2003, management
approved and implemented restructuring actions which included workforce reductions and facility consolidations.
The following table summarizes the amounts recognized by the Company as restructuring and other charges for
the periods presented (in thousands):
Years ended December 31,
2005
2004
2003