Dollar Tree 2014 Annual Report Download - page 33

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obtain proceeds in an amount sufficient to meet any debt service obligations then due.
Our inability to generate sufficient cash flows to satisfy our debt obligations, or to refinance our indebtedness on
commercially reasonable terms or at all, would materially and adversely affect our financial position and results of operations
and our ability to satisfy our obligations.
If we cannot make scheduled payments on our debt, we will be in default and, as a result, holders of the notes (and
lenders under any of our existing and future indebtedness) could declare all outstanding principal and interest to be due and
payable, the lenders under the credit facilities could terminate their commitments to loan money, our secured lenders could
foreclose against the assets securing such borrowings and we could be forced into bankruptcy or liquidation, in each case,
which could result in your losing your investment.
Despite current and anticipated indebtedness levels, we may still be able to incur substantially more debt. This could further
exacerbate the risks described above.
We may be able to incur substantial additional indebtedness in the future. Although the agreements that will govern the
indebtedness to be incurred or assumed in connection with the proposed merger are expected to restrict the incurrence of
additional indebtedness, these restrictions are and will be subject to a number of qualifications and exceptions and the
additional indebtedness incurred in compliance with these restrictions could be substantial. If new debt is added to our current
debt levels, the related risks that we now face could intensify. Upon completion of the pending acquisition, we expect to have
approximately $1,250 million of availability under our new revolving credit facility.
The terms of the agreements governing our indebtedness upon consummation of the proposed merger may restrict our
current and future operations, particularly our ability to respond to changes or to pursue our business strategies, and
could adversely affect our capital resources, financial condition and liquidity.
The agreements that will govern the indebtedness to be incurred or assumed in connection with the proposed merger are
expected to contain a number of restrictive covenants that impose significant operating and financial restrictions on us and
may limit our ability to engage in acts that may be in our long-term best interests, including, among other things, restrictions
on our ability to:
• incur, assume or guarantee additional indebtedness;
• declare or pay dividends or make other distributions with respect to, or purchase or otherwise acquire or retire for
value, equity interests;
• make any principal payment on, or redeem or repurchase, subordinated debt;
• make loans, advances or other investments;
• incur liens;
• sell or otherwise dispose of assets, including capital stock of subsidiaries;
• enter into sale and lease-back transactions;
• consolidate or merge with or into, or sell all or substantially all of our assets to, another person; and
• enter into transactions with affiliates.
In addition, certain of these agreements are expected to require us to comply with certain financial maintenance
covenants. Our ability to satisfy these financial maintenance covenants can be affected by events beyond our control, and we
cannot assure you that we will meet them.
A breach of the covenants under these agreements could result in an event of default under the applicable indebtedness,
which, if not cured or waived, could result in us having to repay our borrowings before their due dates. Such default may
allow the debt holders to accelerate the related debt and may result in the acceleration of any other debt to which a cross-
acceleration or cross-default provision applies. If we are forced to refinance these borrowings on less favorable terms or if
we were to experience difficulty in refinancing the debt prior to maturity, our results of operations or financial condition
could be materially affected. In addition, an event of default under our credit facilities may permit the lenders under our
credit facilities to terminate all commitments to extend further credit under such credit facilities. Furthermore, if we are
unable to repay the amounts due and payable under our credit facilities, those lenders may be able to proceed against the
collateral granted to them to secure that indebtedness. In the event our lenders or holders of notes accelerate the repayment of
such borrowings, we cannot assure you that we will have sufficient assets to repay such indebtedness.
capital to be used to repay our indebtedness when it becomes due. We may not be able to consummate those dispositions or to