O'Reilly Auto Parts 2000 Annual Report Download - page 28

2000 AR
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NOTE 3 – SHORT-TERM INVESTMENTS
The Company’s short-term investments are classified as available-
for-sale in accordance with SFAS No. 115, “Accounting for Certain
Investments in Debt and Equity Securities,” and are carried at cost,
which approximates fair market value. At December 31, 2000, and
1999, short-term investments consisted of preferred equity securities.
NOTE 4 – RELATED PARTIES
The Company leases certain land and buildings related to its
O’Reilly Auto Parts stores under six-year operating lease agreements
with O’Reilly Investment Company and O’Reilly Real Estate
Company, partnerships in which certain shareholders of the
Company are partners. Generally, these lease agreements provide
for renewal options for an additional six years at the option of the
Company. Additionally, the Company leases certain land and buildings
related to its O’Reilly Auto Parts stores under 15-year operating
lease agreements with O’Reilly-Wooten 2000 LLC, which is owned
by certain shareholders of the Company. Generally, these lease
agreements provide for renewal options for two additional five-year
terms at the option of the Company (see Note 7). Rent expense
under these operating leases totaled $2,671,000, $2,647,000 and
$2,158,000 in 2000, 1999 and 1998, respectively.
NOTE 5 – NOTE PAYABLE TO BANK
At December 31, 2000, the Company had available short-term
unsecured bank lines of credit providing for maximum borrowings
of $10 million, all of which was outstanding at December 31,
2000, and $5 million of which was outstanding at December 31,
1999. The lines of credit bear interest at LIBOR plus 0.50% (7.25%
at December 31, 2000). Additionally, at December 31, 2000, the
Company had available a short-term line of credit in the amount of
$25 million, all of which was outstanding at December 31, 2000.
This line of credit was paid in full on January 9, 2001. The line of
credit bears interest at LIBOR plus 0.75% (7.45% at December 31,
2000). The weighted-average interest rate for all lines of credit for
the years ended December 31, 2000, and 1999 was 7.2% and
6.7%, respectively.
NOTE 6 – LONG-TERM DEBT
At December 31, 2000, the Company had available an unsecured
credit facility providing for maximum borrowings of $152.5 million.
The facility is comprised of a revolving credit facility of $125 million
and a term loan of $27.5 million. At December 31, 1999, the
Company had available a credit facility providing for maximum
borrowings of $165 million. The facility was comprised of a
$125 million revolving credit facility and a $40 million term loan.
At December 31, 2000, and 1999, $74,755,000 and $61,560,000,
respectively, of the revolving credit facility and $27.5 million and
$40 million, respectively, of the term loan were outstanding. The
credit facility, which bears interest at LIBOR plus 0.50% (7.0% at
December 31, 2000), expires in January 2003.
During 2000 and 1999, the Company leased certain computer
equipment under capitalized leases. The lease agreements are
three-year terms expiring from 2001 to 2003. At December 31,
2000, the monthly installments under these agreements were
approximately $180,000. The present value of the future minimum
lease payments under these agreements totaled $2,232,000 and
$3,362,000 at December 31, 2000, and 1999, respectively, which has
been classified as long-term debt in the accompanying consolidated
financial statements. During 2000 and 1999, the Company
purchased $800,000 and $2,676,000, respectively, of assets
under capitalized leases.
Additionally, the Company has various unsecured notes payable
to individuals, amounting to $97,000 and $140,000, at December
31, 2000, and 1999, respectively. The notes bear interest at rates
ranging from 7.75% to 9.0% and are due in monthly installments
of approximately $1,500 including interest. Only one note
remained at December 31, 2000, which matures in 2008.
Indirect borrowings under letters of credit provided by a
$5,000,000 sublimit of the revolving credit facility totaled
$648,510 and $1,275,000 at December 31, 2000, and 1999,
respectively. These letters of credit reduced availability of
borrowings at December 31, 2000, and 1999.
Principal maturities of long-term debt for each of the next five
years ending December 31 are as follows:
(In thousands)
2001 $ 14,121
2002 11,715
2003 78,684
2004 13
2005 14
Thereafter 37
$ 104,584
Cash paid by the Company for interest during the years ended
December 31, 2000, 1999 and 1998 amounted to $8,240,000,
$6,134,000 and $8,509,000, respectively.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS continued …
O’REILLY AUTOMOTIVE