Einstein Bros 2005 Annual Report Download - page 51

http://www.sec.gov/Archives/edgar/data/949373/000110465906016136/a06-3178_110k.htm[9/11/2014 10:13:03 AM]
The income tax effects of temporary differences that give rise to significant portions of deferred tax assets as of January 3, 2006 and
December 28, 2004 are as follows:
2005 2004
(in thousands of dollars)
Deferred tax assets
Operating loss carryforwards $ 59,958 $ 57,412
Capital loss carryforwards 1,237 1,237
Accrued expenses 1,317 2,424
Allowances for doubtful accounts 183 893
Other assets 58 32
Property, plant and equipment 15,852 12,016
Total gross deferred tax asset
78,605 74,014
Less valuation allowance (78,605) (74,014)
Total deferred tax liability
$ — $ —
For income tax purposes, at January 3, 2006, we had net operating loss carryforwards of approximately $157 million, expiring at various dates
through 2025. The utilization of approximately $103 million of the aforementioned net operating loss carryforwards is subject to an annual
limitation under the provisions of Section 382 of the Internal Revenue Code.
At this time, we believe it is more likely than not that our net deferred tax asset will not be realized. Accordingly, a valuation allowance has
been recorded against the deferred tax asset at January 3, 2006 and December 28, 2004. Should we conclude that the deferred tax asset is, at least
in part, realizable, the valuation allowance will be reversed to the extent of such expected realizability.
22. SUPPLEMENTAL CASH FLOW INFORMATION
2005 2004 2003
(in thousands of dollars)
Cash paid during the period for:
Interest $ 32,084 $ 21,166 $ 17,284
Non-cash investing and financing activities:
Non-cash dividends and accretion on preferred stock $ — $ — $ 14,423
Conversion of Bridge Loan and Bond Purchase Agreement
to Mandatorily Redeemable Series F preferred stock $ — $ — $ 18,588
Conversion of Mandatorily Redeemable Series F
to Mandatorily Redeemable Series Z preferred stock $ — $ — $ 57,000
Conversion of Mandatorily Redeemable Series F to common stock $ — $ — $ 61,706
Non-cash warrant issuance $ — $ — $ 1,854
Non-cash option issuance $ — $ 205 $ —
Non-cash purchase of equipment through capital leasing $ 33 $ 51 $ —
23. RELATED PARTY TRANSACTIONS
Several of our stockholders or former stockholders, including BET Associates LP (BET), Halpern Denny, Greenlight Capital, LLC and certain
of their affiliates (Greenlight), have been involved in our
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NEW WORLD RESTAURANT GROUP, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
financings, refinancings, have purchased our debt and equity securities and were involved in our equity recapitalization as further described in
Note 13. Below, we have summarized related party transactions involving these investors during the 2005, 2004 and 2003 fiscal years.
Greenlight Capital, LLC and its affiliates