Cogeco 2012 Annual Report Download - page 68

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Consolidated financial statements COGECO CABLE INC. 2012 67
15. LONG-TERM DEBT
Maturity Interest rate
August 31,
2012
August 31,
2011
September 1,
2010
(In thousands of Canadian dollars) % $$ $
Parent Corporation
Term Revolving Facility a)
Revolving loans November 2016 4.00(1) 110,000
Revolving loans - €90 million at September 1, 2010 November 2016 2.63(2) 121,635
Senior Secured Notes b)
Series A – US$190 million October 2015 7.00
(3) 186,244 185,049 201,387
Series B October 2018 7.60 54,619 54,646 54,609
Senior Secured Debentures Series 1 c) June 2014 5.95 298,694 298,016 297,379
Senior Secured Debentures Series 2 d) November 2020 5.15 198,539 198,400
Senior Secured Debentures Series 3 e) February 2022 4.93 198,249
Senior Secured Notes Series B f) October 2011 7.73 174,738
Senior Unsecured Debenture g) March 2018 5.94 99,850 99,827 99,806
Subsidiaries
Finance leases October 2013 6.73 – 9.93 837 2,939 5,429
1,037,032 948,877 954,983
Less current portion 830 2,094 2,296
1,036,202 946,783 952,687
(1) Interest rate on debt at August 31, 2011, including applicable margin.
(2) Interest rate on debt at September 1, 2010, including applicable margin.
(3) Cross-currency swap agreements have resulted in an effective interest rate of 7.24% on the Canadian dollar equivalent of the US denominated debt.
a) On November 22, 2011, the Corporation renewed its credit agreement for a $750 million credit facility, with an option to increase to a
total amount of up to $1 billion, subject to lenders’ participation, in the form of a five-year Term Revolving Facility, which may be
extended by additional one-year periods on an annual basis, subject to lenders’ approval. The Term Revolving Facility is available in
Canadian, US or Euro currencies and includes a swingline of $25 million available in Canadian or US currencies. The Term
Revolving Facility will mature on November 22, 2016. The Term Revolving Facility requires commitment fees, and interest rates are
based on bankers’ acceptance, LIBOR in Euros or in US dollars, bank prime rate loan or US base rate loan plus the applicable
margin.The Term Revolving Facility is indirectly secured by a first priority fixed and floating charge on substantially all present and
future real and personal property and undertaking of every nature and kind of the Corporation and certain of its subsidiaries, and
provides for certain permitted encumbrances, including purchased money obligations, existing funded obligations and charges
granted by any subsidiary prior to the date when it becomes a subsidiary, subject to a maximum amount. The provisions under this
facility provides for restrictions on the operations and activities of the Corporation. Generally, the most significant restrictions relate to
permitted investments and dividends on multiple and subordinate voting shares, as well as incurrence and maintenance of certain
financial ratios primarily linked to operating income before amortization, financial expense and total indebtedness. At August 31, 2012
and 2011 and September 1, 2010, the Corporation was in compliance with all of its covenants.
b) On October 1, 2008, the Corporation issued US$190 million Senior Secured Notes Series A maturing October 1, 2015, and
$55 million Senior Secured Notes Series B maturing October 1, 2018, net of transaction costs of $2.1 million, for net proceeds of
$255 million. The Senior Secured Notes Series B bear interest at the coupon rate of 7.60% per annum, payable semi-annually. The
Corporation has entered into cross-currency swap agreements to fix the liability for interest and principal payments on the Senior
Secured Notes Series A in the amount of US$190 million, which bear interest at the coupon rate of 7.00% per annum, payable semi-
annually. Taking into account these agreements, the effective interest rate on the Senior Secured Notes Series A is 7.24% and the
exchange rate applicable to the principal portion of the US dollar-denominated debt has been fixed at $1.0625. The Senior Secured
Notes are senior secured obligations and rank equally and rateably with all existing and future senior indebtedness. These notes are
indirectly secured by a first priority fixed and floating charge and a security interest on substantially all present and future real and
personal property and undertaking of every nature and kind of the Corporation and certain of its subsidiaries. The notes are
redeemable at the Corporation’s option at any time, in whole or in part, prior to maturity, at 100% of the principal amount plus a make-
whole premium.