Neiman Marcus 2012 Annual Report Download - page 116

Table of Contents
Maturities of Long-Term Debt. At August 3, 2013, annual maturities of long-term debt during the next five fiscal years and thereafter are as
follows (in millions):
2014 $ —
2015 —
2016 15.0
2017 —
2018 2,560.0
Thereafter 122.1
The previous table does not reflect future excess cash flow prepayments, if any, that may be required under the Senior Secured Term Loan Facility.
Loss on Debt Extinguishment. In connection with the TLF Amendment and the retirement of the Senior Notes, we incurred a loss on debt
extinguishment of $70.4 million, which included 1) costs of $37.9 million related to the tender for and redemption of our Senior Notes and 2) the write-off of
$32.5 million of debt issuance costs related to the extinguished debt facilities. The total loss on debt extinguishment was recorded as a component of interest
expense. In addition, we incurred debt issuance costs in fiscal year 2011 of approximately $33.9 million, which are being amortized over the terms of the
amended debt facilities.
In connection with the Refinancing Transactions, we incurred a loss on debt extinguishment of $15.6 million, which included 1) costs of $10.7
million related to the tender for and redemption of our Senior Subordinated Notes and 2) the write-off of $4.9 million of debt issuance costs related to the initial
issuance of the Senior Subordinated Notes. The total loss on debt extinguishment was recorded in the second quarter of fiscal year 2013 as a component of
interest expense. In addition, we incurred debt issuance costs in the second quarter of fiscal year 2013 of approximately $7.3 million, which are being
amortized over the term of the amended debt facility.
Interest expense. The significant components of interest expense are as follows:
Fiscal year ended
(in thousands)
August 3,
2013
July 28,
2012
July 30,
2011
Asset-Based Revolving Credit Facility $ 1,453 $ 1,052 $ —
Senior Secured Term Loan Facility 108,489 98,989 75,233
2028 Debentures 9,004 8,906 8,881
Senior Notes — — 53,916
Senior Subordinated Notes 19,031 51,873 51,732
Amortization of debt issue costs 8,404 8,457 14,661
Other, net 7,214 7,040 6,177
Capitalized interest (237)(1,080) (535)
$153,358 $175,237 $210,065
Loss on debt extinguishment 15,597 —70,388
Interest expense, net $168,955 $175,237 $280,453
NOTE 7. DERIVATIVE FINANCIAL INSTRUMENTS
At August 3, 2013, we had outstanding floating rate debt obligations of $2,575.0 million. We have entered into interest rate cap agreements (at a cost
of $5.8 million) for an aggregate notional amount of $1,000.0 million in order to hedge the variability of our cash flows related to a portion of our floating rate
indebtedness. The interest rate cap agreements cap LIBOR at 2.50% from December 2012 through December 2014 with respect to the $1,000.0 million notional
amount of such agreements. In the event LIBOR is less than 2.50%, we will pay interest at the lower LIBOR rate. In the event LIBOR is higher than 2.50%,
we will pay interest at the capped rate of 2.50%.
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