Dollar General 2009 Annual Report Download - page 54

All obligations and related guarantees under the Term Loan Facility are secured by:
• a second-priority security interest in all existing and after-acquired inventory, accounts
receivable, and other assets arising from such inventory and accounts receivable, of our company
and each U.S. Guarantor (the ‘‘Revolving Facility Collateral’’), subject to certain exceptions;
• a first-priority security interest in, and mortgages on, substantially all of our and each U.S.
Guarantor’s tangible and intangible assets (other than the Revolving Facility Collateral); and
• a first-priority pledge of 100% of the capital stock held by us, or any of our domestic
subsidiaries that are directly owned by us or one of the U.S. Guarantors and 65% of the voting
capital stock of each of our existing and future foreign subsidiaries that are directly owned by us
or one of the U.S. Guarantors.
All obligations and related guarantees under the ABL Facility are secured by the Revolving Facility
Collateral, subject to certain exceptions.
Certain Covenants and Events of Default. The senior secured credit agreements contain a number
of covenants that, among other things, restrict, subject to certain exceptions, our ability to:
• incur additional indebtedness;
• sell assets;
• pay dividends and distributions or repurchase our capital stock;
• make investments or acquisitions;
• repay or repurchase subordinated indebtedness (including the Senior Subordinated Notes
discussed below) and the Senior Notes discussed below;
• amend material agreements governing our subordinated indebtedness (including the Senior
Subordinated Notes discussed below) or our Senior Notes discussed below;
• change our lines of business.
The senior secured credit agreements also contain certain customary affirmative covenants and
events of default.
At January 29, 2010, we had no borrowings, $85.1 million of standby letters of credit, and
$15.4 million of commercial letters of credit, outstanding under our ABL Facility.
Senior Notes due 2015 and Senior Subordinated Toggle Notes due 2017
Overview. As of January 29, 2010, we have $979.3 million aggregate principal amount of 10.625%
senior notes due 2015 (the ‘‘Senior Notes’’) outstanding (reflected in our consolidated balance sheet
net of a $14.8 million discount), which mature on July 15, 2015, pursuant to an indenture dated as of
July 6, 2007 (the ‘‘senior indenture’’), and $450.7 million aggregate principal amount of
11.875%/12.625% senior subordinated toggle notes due 2017 (the ‘‘Senior Subordinated Notes’’)
outstanding, which mature on July 15, 2017, pursuant to an indenture dated as of July 6, 2007 (the
‘‘senior subordinated indenture’’). The Senior Notes and the Senior Subordinated Notes are collectively
referred to herein as the ‘‘Notes.’’ The senior indenture and the senior subordinated indenture are
collectively referred to herein as the ‘‘indentures.’’
Interest on the Notes is payable on January 15 and July 15 of each year. Interest on the Senior
Notes is payable in cash. Cash interest on the Senior Subordinated Notes accrues at a rate of 11.875%
per annum, and PIK interest (as that term is defined below) accrues at a rate of 12.625% per annum, if
applicable. The initial interest payment on the Senior Subordinated Notes was payable in cash. For any
interest period thereafter through July 15, 2011, we may elect to pay interest on the Senior
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