Popeye's 2013 Annual Report Download - page 75

Popeyes Louisiana Kitchen, Inc.
Notes to Consolidated Financial Statements
For Fiscal Years 2013, 2012, and 2011 — (Continued)
59
Note 9 — Long-Term Debt and Other Borrowings
(in millions) 2013 2012
2013 Credit Facility:
Revolving credit facility $63.0 $ —
2010 Credit Facility:
Revolving credit facility —37.0
Term loan — 31.3
Capital lease obligations 2.2 2.3
Other notes 2.0 2.2
67.2 72.8
Less current portion (0.3)(6.0)
$66.9 $66.8
2013 Credit Facility. On December 18, 2013, the Company entered into abank credit facility with agroup of lenders
consisting of afive year $125.0 million dollar revolving credit facility.The Company drew $63.0 million under the
revolving credit facility which was used to retire the Company's 2010 Credit Facility.
Outstanding balances accrue interest at a margin of 125 to 250 basis points over the London Interbank Offered Rate
(“LIBOR”) or other alternative indices plus an applicable margin as specified in the facility.The commitment fee on
the unused balance under the facility ranges from 15 to 40 basis points. The increment over LIBOR and the commitment
fee are determined quarterly based upon the Consolidated Total Leverage Ratio. As of December 29, 2013 and December
30, 2012, the Company’s weighted average interest rates for all outstanding indebtedness under its credit facilities were
1.5% and 3.7% respectively.
Under the terms of the revolving credit facility,the Company may obtain other short-term borrowings of up to $10.0
million and letters of credit up to $20.0 million.Collectively,these other borrowings and letters of credit may not exceed
the amount of unused borrowings under the 2013 Credit Facility. As of December 29, 2013,the Company had $0.9
million of outstanding letters of credit. The Company had $61.1 million available for short-term borrowings and letter
of credit under its 2013 Credit Facility as of December 29, 2013.
The 2013 Credit Facility is secured by afirst priority security interest in substantially all of the Company’sassets,
excluding real estate. The 2013 Credit Facility contains financial and other covenants, including covenants requiring
the Company to maintain various financial ratios, limiting its ability to incur additional indebtedness, restricting the
amount of capital expenditures that may be incurred, restricting the payment of cash dividends, and limiting the amount
of debt which can be loaned to the Company’s franchisees or guaranteed on their behalf. This facility also limits the
Company’sability to engage in mergers or acquisitions, sell certain assets, repurchase its common stock and enter into
certain lease transactions. The 2013 Credit Facility includes customary events of default, including, but not limited to,
the failure to pay any interest, principal or fees when due, the failure to perform certain covenant agreements, inaccurate
or false representations or warranties, insolvency or bankruptcy, change of control, the occurrence of certain ERISA
events and judgment defaults. At December 29, 2013, the Company was compliant with all debt covenant requirements.
The Company expensed $0.4 million associated with the extinguishment of the 2010 Credit Facility, which is reported
as a component of “Interest expense, net.” Additionally,the Company capitalized approximately $0.7 million of fees
related to the new facility as debt issuance costs which will be amortized over the remaining life of the facility utilizing
the straight-line method for the revolving credit facility.