Jack In The Box 2014 Annual Report Download - page 62

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

corporate purposes. At September 28, 2014, we had borrowings under the revolving credit facility of $306.0 million, $197.5 million outstanding under the
term loan and letters of credit outstanding of $22.2 million.
Collateral — The Company’s obligations under the credit facility are secured by first priority liens and security interests in the capital stock, partnership and
membership interests owned by the Company and (or) its subsidiaries, and any proceeds thereof, subject to certain restrictions set forth in the credit
agreement. Additionally, there is a negative pledge on all tangible and intangible assets (including all real and personal property) with customary exceptions
as reflected in the credit agreement.
Covenants — We are subject to a number of customary covenants under our credit facility, including limitations on additional borrowings, acquisitions,
loans to franchisees, capital expenditures, lease commitments, stock repurchases and dividend payments, and requirements to maintain certain financial ratios
as defined in the credit agreement.
Future cash payments — Scheduled principal payments on our long-term debt outstanding at September 28, 2014 for each of the next five fiscal years and
thereafter are as follows (in thousands):

2015
$ 10,871
2016
15,900
2017
15,863
2018
18,168
2019
446,291
Thereafter
790
$ 507,883
We may make voluntary prepayments of the loans under the revolving credit facility and term loan at any time without premium or penalty. Specific events
such as asset sales, certain issuances of debt, and insurance and condemnation recoveries, may trigger a mandatory prepayment.
Capitalized interest — We capitalize interest in connection with the construction of our restaurants and other facilities. Interest capitalized in 2013 and 2012
totaled $0.1 million and $0.4 million, respectively. In 2014, no interest was capitalized.

As lessee — We lease restaurants and other facilities, which generally have renewal clauses of 5 to 20 years exercisable at our option. In some instances, our
leases have provisions for contingent rentals based upon a percentage of defined revenues. Many of our leases also have rent escalation clauses and require
the payment of property taxes, insurance and maintenance costs. We also lease certain restaurant and office equipment, and in 2012, we leased various
transportation equipment. Minimum rental obligations are accounted for on a straight-line basis over the term of the initial lease.
The components of rent expense were as follows in each fiscal year (in thousands):



Minimum rentals
$ 213,082
$ 210,638
$ 206,604
Contingent rentals
1,986
1,840
2,013
Total rent expense
215,068
212,478
208,617
Less rental expense on subleased properties
(139,976)
(136,970)
(130,275)
Net rent expense
$ 75,092
$ 75,508
$ 78,342
F-18