Home Shopping Network 2012 Annual Report Download - page 51

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Table of Contents
Financial information by segment is as follows (thousands):
HSNi does not report revenue from external customers for each product or each group of similar products as it is impracticable to do so.
HSNi maintains operations principally in the United States with no long-lived assets and insignificant net sales in all other countries.
NOTE 7—LONG-TERM DEBT
On April 24, 2012, HSNi entered into a $600 million five -year syndicated credit agreement ("Credit Agreement") which is secured by
100% of the voting equity securities of HSNi's U.S. subsidiaries and 65% of HSNi's first-tier foreign subsidiaries. This Credit Agreement
replaced the credit agreement that was set to expire in July 2013. Certain HSNi subsidiaries have unconditionally guaranteed HSNi's obligations
under the Credit Agreement. The Credit Agreement, which includes a $350 million revolving credit facility and a $250 million delayed draw
term loan, may be increased up to $850 million subject to certain conditions and expires April 24, 2017. HSNi drew $250 million from its term
loan on July 31, 2012 to fund the redemption of the Senior Notes, as discussed below. HSNi capitalized $5.5 million
in financing costs related to
the Credit Agreement and is amortizing these costs to interest expense over the Credit Agreement's five -year life.
The Credit Agreement includes various covenants, limitations and events of default customary for similar facilities including a maximum
leverage ratio of 3.00 x and a minimum interest coverage ratio of 3.00 x. HSNi was in compliance with all such covenants as of December 31,
2012, with a leverage ratio of 0.80 x and an interest coverage ratio of 16.72 x. The Credit Agreement also contains covenants that limit our
ability and the ability of our subsidiaries to, among other things, incur additional indebtedness, pay dividends or make other distributions,
repurchase or redeem our stock, make investments, sell assets, incur liens, enter into agreements restricting our subsidiaries' ability to pay
dividends, enter into transactions with affiliates and consolidate, merge or sell all or substantially all of our assets.
46
Year Ended December 31,
2012
2011
2010
Net sales:
HSN
$
2,265,026
$
2,160,341
$
2,115,918
Cornerstone
1,001,713
909,015
768,390
Total
$
3,266,739
$
3,069,356
$
2,884,308
Identifiable assets:
HSN
$
1,083,714
$
1,178,565
$
1,138,024
Cornerstone
248,238
216,408
207,719
Total
1,331,952
1,394,973
1,345,743
Capital expenditures:
HSN
$
33,566
$
30,155
$
29,152
Cornerstone
12,237
11,914
7,854
Total
$
45,803
$
42,069
$
37,006
December 31,
2012
2011
Secured credit agreement terminated April 24, 2012:
Term loan
$
—
$
—
Revolving credit facility
—
—
Secured credit agreement expiring April 24, 2017:
Term loan
250,000
—
Revolving credit facility
—
—
11.25% Senior Notes due August 1, 2016 redeemed August 1, 2012
—
240,000
Unamortized original issue discount on Senior Notes
—
(
889
)
Total long-term debt
250,000
239,111
Less: current maturities
(9,375
)
—
Long-term debt, net of current maturities
$
240,625
$
239,111