Cracker Barrel 2013 Annual Report Download - page 44

on the present value of expected future cash ows. Since the
Company’s interest rate swap values are based on the LIBOR
forward curve, which is observable at commonly quoted
intervals for the full terms of the swaps, it is considered a
Level 2 input. Nonperformance risk is reected in determin-
ing the fair value of the interest rate swaps by using the
Company’s credit spread less the risk-free interest rate, both
of which are observable at commonly quoted intervals for
the terms of the swaps. us, the adjustment for nonperfor-
mance risk is also considered a Level 2 input.
e fair values of accounts receivable and accounts payable
at August 2, 2013 and August 3, 2012, approximate their
carrying amounts because of their short duration. e fair
value of the Company’s variable rate debt, based on
quoted market prices, which are considered Level 1 inputs,
approximates its carrying amounts at August 2, 2013 and
August 3, 2012.
4 INVENTORIES
Inventories were comprised of the following at:
August 2, August 3,
2013 2012
Retail $ 112,736 $ 108,846
Restaurant 20,214 19,728
Supplies 13,737 14,693
Total $ 146,687 $ 143,267
5 DEBT
On July 9, 2011, the Company entered into a ve-year
$750,000 credit facility (the “Credit Facility”) consisting of a
$250,000 term loan and a $500,000 revolving credit facility
(the “Revolving Credit Facility”).
Long-term debt consisted of the following at:
August 2, August 3,
2013 2012
Revolving Credit Facility expiring
on July 8, 2016 $ 212,500 $ 312,500
Term loan payable on or before July 8, 2016 187,500 212,500
Note payable — 142
400,000 525,142
Current maturities — (106)
Long-term debt $ 400,000 $ 525,036
e aggregate maturities of long-term debt subsequent to
August 2, 2013 are as follows:
Year
2014 $ —
2015 25,000
2016 375,000
Total $ 400,000
At August 2, 2013, the Company had $28,971 of standby
leers of credit, which reduce the Company’s availability
under the Revolving Credit Facility (see Note 16). At
August 2, 2013, the Company had $258,529 in borrowing
availability under the Revolving Credit Facility.
In accordance with the Credit Facility, outstanding
borrowings bear interest, at the Company’s election, either
at LIBOR or prime plus a percentage point spread based
on certain specied nancial ratios. At August 2, 2013 and
August 3, 2012, the Company’s outstanding borrowings
were swapped at weighted average interest rates of 3.73%
and 7.57%, respectively (see Note 6 for information on the
Company’s interest rate swaps).
e Credit Facility contains customary nancial covenants,
which include maintenance of a maximum consolidated
total leverage ratio and a minimum consolidated interest
coverage ratio. At August 2, 2013 and August 3, 2012,
the Company was in compliance with all debt covenants.
e Credit Facility also imposes restrictions on the
amount of dividends the Company is permied to pay. Prior
to the June 3, 2013 amendment described below, if there
was no default existing and the total of the Company’s
availability under the Revolving Credit Facility plus the
Company’s cash and cash equivalents on hand is at least
$100,000 (the “liquidity requirements”), the Company could
declare and pay cash dividends on its common stock if the
aggregate amount of dividends paid in any scal year is
less than 20% of Consolidated EBITDA from continuing
operations (as dened in the Credit Facility) (the “20%
limitation”) during the immediately preceding scal year. In
any event, as long as the liquidity requirements were met,
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