Citrix 2006 Annual Report Download - page 95

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Citrix Systems, Inc.  Annual Report
acquire shares. These programs include terms that
require the Company to make up-front payments to the
counterparty financial institution and result in the receipt
of stock during and/or at the end of the period of the
agreement or the receipt of either stock or cash at
the maturity of the agreement, depending on
market conditions.
The Company made prepayments to financial institutions,
net of premiums received, during 2006, 2005, and
2004 of approximately $114.4 million, $52.2 million and
$107.0 million, respectively. During 2006, 2005 and
2004, the Company expended approximately $159.8
million, $122.2 million and $14.9 million, respectively,
on open market purchases. Under its structured stock
repurchase agreements the Company took delivery of
4,307,112 shares, at an average price of $30.76, 2,302,217
shares at an average price of $22.02 and 3,585,740
shares, at an average price of $19.19 during 2006, 2005
and 2004, respectively. Due to the fact that the total
shares to be received under its structured repurchase
arrangements at December 31, 2006 is not determinable
until the contracts mature, the above price per share
amounts exclude the remaining shares to be received
subject to the agreements. As of December 31, 2006,
the Company has remaining prepaid notional amounts of
approximately $36.3 million remaining under structured
stock repurchase agreements, which expire in January
2007. The Company repurchased 5,193,410 shares of
outstanding common stock with an average price of
$30.77, repurchased 5,054,400 shares of outstanding
common stock with an average price of $24.18 and
repurchased 873,000 shares with an average price of
$17.06 during 2006, 2005 and 2004, respectively, in
its open market purchase transactions. In addition, a
significant portion of the funds used to repurchase stock
was funded by proceeds from employee stock option
exercises and the related tax benefits.
The Company suspended its stock repurchase program
for the duration of its Audit Committee’s voluntary,
independent review of the Company’s historical stock
option granting practices and related accounting. For more
information on the Audit Committee’s independent review
of historical stock option granting practices and related
accounting see “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” elsewhere
in this Annual Report.
Preferred Stock
The Company is authorized to issue 5,000,000 shares of
preferred stock, $0.01 par value per share. The Company
has no present plans to issue such shares.
9. Long-Term Debt
Credit Facility
Effective on August 9, 2005, the Company entered into
a revolving credit facility (the “Credit Facility”) with a
group of financial institutions (the “Lenders”). Effective
September 27, 2006, the Company entered into an
amendment and restatement of its Credit Facility (the
“Amendment”). The Amendment decreased the overall
range of interest rates the Company will pay on amounts
outstanding on the Credit Facility and lowered the facility
fee. In addition, the Amendment extended the term of the
Credit Facility. The Credit Facility, as amended, allows the
Company to increase the revolving credit commitment up
to a maximum aggregate revolving credit commitment of
$175.0 million. The Credit Facility, as amended, currently
provides for a revolving line of credit that will expire on
September 27, 2011 in the aggregate amount of $100.0
million, subject to continued covenant compliance. A
portion of the revolving line of credit (i) in the aggregate
amount of $25.0 million may be available for issuances of
letters of credit and (ii) in the aggregate amount of $15.0
million may be available for swing line loans. The Credit
Facility currently bears interest at LIBOR plus 0.32% and
adjusts in the range of 0.32% to 0.80% above LIBOR
based on the level of the Company’s total debt and its
adjusted earnings before interest, taxes, depreciation
and amortization (“EBITDA”) as defined in the agreement.
In addition, the Company is required to pay a quarterly
facility fee ranging from 0.08% to 0.20% based on the
aggregate amount available under the Credit Facility,
as amended, and the level of the Company’s total debt
and its adjusted EBITDA. Borrowings under the Credit
Facility, as amended, are guaranteed by the Company
and certain of the Company’s United States and foreign
subsidiaries, which guarantees are secured by a pledge
of shares of certain foreign subsidiaries. During 2005,
the Company borrowed and repaid $75.0 million under
the Credit Facility. As of December 31, 2006, there
were no amounts outstanding under the Credit Facility,
as amended.