Einstein Bros 2003 Annual Report Download - page 28

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http://www.sec.gov/Archives/edgar/data/949373/000104746904009609/a2132006z10-k.htm[9/11/2014 10:13:55 AM]
$160 Million Facility due July 1, 2008, which is classified as a long-term liability.
In fiscal 2003, we generated $2.0 million of cash from operations compared with operations consuming cash of $6.7 million in fiscal 2002.
Our net loss of $67.7 million was partially offset by non-cash charges of $28.2 million of depreciation and amortization, $23.0 million related to
the exchange of Series F, $7.8 million associated with non-cash interest, warrants, debt issuance and debt discount, $5.3 million associated with
the impairment of trademarks, $2.1 million of changes for integration and reorganization and increased by $2.5 million of other non-cash items.
The change in our operating assets and liabilities was attributable to a use of cash related to our restricted cash for worker's compensation
insurance and franchisee adfunds offset by an increase of $8.5 million of accounts payable and accrued expenses primarily attributable to
$10.0 million of accrued interest payable on our $160 Million Facility.
In fiscal year 2003, we used $6.0 million of cash in investing activities compared with providing $32.9 million of cash in fiscal 2002, which
includes $36.7 million of proceeds from investment in debt securities. During fiscal 2003, we used cash to purchase additional property and
equipment which included $2.2 million for new stores, $4.1 million for replacement and new equipment at our company-operated stores,
$0.1 million for our manufacturing operations and $0.5 million for general corporate purposes. These investing expenditures were partially offset
by $0.4 million received related to the Einstein Bonds and $0.6 million of proceeds from the sale of equipment.
32
In fiscal year 2003, we generated $3.6 million of cash by financing activities compared with using $31.0 million of cash in fiscal 2002, which
includes $37.0 million of repayments related to the Bridge Loan. The refinancing of the $140 Million Facility and other related activities generated
approximately $10.3 million of cash. This was partially offset by net repayments of $5.0 million on our AmSouth Revolver credit facility with
AmSouth and a deposit, net of repayments, of approximately $1.7 million of cash into a restricted escrow account associated with the repayment of
a note payable to the New Jersey Econmic Development Authority ("NJEDA").
Contractual Obligations
The following table summarizes the amounts of payments due under specified contractual obligations as of December 30, 2003:
Payments Due By Period
(amounts in thousands)
Contractual Obligations
Total
Less Than
1 Year
1-3 Years
4-5 Years
After
5 Years
Debt $ 163,225 $ 2,105 $ 560 $ 160,560 $ —
Capital Lease Obligations 209 180 29 — —
Operating Leases 94,206 28,981 45,507 13,321 6,397
Purchase Obligations(a) 14,245 7,529 6,716 — —
Other Long-Term GAAP Obligations(b) 8,888 1,104 461 461 6,862
Total $ 280,773 $ 39,899 $ 53,273 $ 174,342 $ 13,259
(a) Purchase obligations consist of non-cancelable minimum purchases of frozen dough from our supplier and certain other raw
ingredients that are used in our products.
(b) Other long-term GAAP obligations consist of the remaining liability related to minimum future purchase commitments with a
supplier that advanced us $10.0 million in 1996 and guaranteed franchise debt.
Off-Balance Sheet Transactions With the exception of the Purchase Obligations as presented in the table above, and also in Note 1 to the
Consolidated Financial Statements, we do not engage in material off-balance sheet transactions.
Recent Accounting Pronouncements
In January 2003, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 46 (FIN 46), "Consolidation of Variable
Interest Entities, an Interpretation of ARB No. 51." The primary objective of this interpretation is to provide guidance on the identification of, and
financial reporting for, entities over which control is achieved through means other than voting rights; such entities are known as variable-interest