Express 2012 Annual Report Download - page 73

unpaid interest. On or after March 1, 2014, the Senior Notes may be redeemed in part or in full at the following
percentages of the outstanding principal amount prepaid: 104.375% prior to March 1, 2015; 102.188% on or after
March 1, 2015, but prior to March 1, 2016; and at the principal amount on or after March 1, 2016. In the first
quarter of 2011, $25.0 million of Senior Notes were repurchased on the open market at a price of 108.75% of the
principal amount. In the second quarter of 2011, $24.2 million of Senior Notes were repurchased on the open
market at an average price of 109.21% of the principal amount.
The indenture governing the Senior Notes contains customary covenants and restrictions on the activities of
Express, LLC, Express Finance, and Express, LLC’s restricted subsidiaries, including, but not limited to, the
incurrence of additional indebtedness; payment of dividends or distributions in respect of capital stock or certain
other restricted payments or investments; entering into agreements that restrict distributions from restricted
subsidiaries; the sale or disposal of assets, including capital stock of restricted subsidiaries; transactions with
affiliates; the incurrence of liens; and mergers, consolidations or the sale of substantially all of Express, LLC’s
assets. Certain of these covenants will be suspended if the Senior Notes are assigned an investment grade rating
by both Standard & Poor and Moody’s Investors Service and no default has occurred or is continuing. If either
rating on the Senior Notes should subsequently decline to below investment grade, the suspended covenants will
be reinstated.
Topco Credit Facility
On June 26, 2008, Express Topco, as borrower, entered into a $300.0 million secured term loan facility. The
Topco Credit Facility was scheduled to mature on June 26, 2015 and was comprised of a $150.0 million Term B
Loan and a $150.0 million Term C Loan. On March 5, 2010, in connection with the Senior Notes offering, all of
the Term C Loan was prepaid, plus prepayment penalties and accrued interest thereon. On May 18, 2010, in
connection with the IPO, all of the Term B Loan was prepaid, plus prepayment penalties and accrued and unpaid
interest thereon.
Loss on Extinguishment
In connection with the prepayment of the Term C Loan on March 10, 2010, the Company recognized a loss on
extinguishment of debt totaling $7.2 million. This amount consisted of a $3.0 million prepayment penalty, the
write-off of $2.5 million of unamortized discount, and the write-off of $1.6 million of unamortized debt issuance
costs.
On May 18, 2010, net proceeds from the IPO were used to prepay $164.9 million related to the Term B Loan
(including principal, interest, and a prepayment penalty). Of the Term B Loan prepayment, $58.3 million of
principal, $2.1 million of interest, and $3.5 million of the prepayment penalty was paid to a Golden Gate affiliate.
In connection with the prepayment of the Term B Loan on May 18, 2010, the Company recognized a loss on
extinguishment of debt totaling $13.6 million. This amount consisted of a $9.0 million prepayment penalty, the
write off of $2.5 million of unamortized discount, and the write-off of $2.1 million of unamortized debt issuance
costs.
In connection with the Senior Notes repurchases in 2011, the Company recognized a $6.9 million loss on
extinguishment of debt. Of this loss on extinguishment of debt, the premium on the repurchases represented $4.4
million. The remaining loss on extinguishment consisted of the write-off of unamortized debt issuance costs and
unamortized discount totaling $2.5 million.
In connection with amending and restating the existing Revolving Credit Facility in 2011, the Company
recognized a $0.3 million loss on extinguishment of debt, which consisted of the write-off of unamortized debt
issuance costs.
In connection with the prepayment of the Term Loan in 2011, the Company recognized a $2.4 million loss on
extinguishment of debt, which consisted of the write-off of unamortized debt issuance costs.
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