Sally Beauty Supply 2006 Annual Report Download - page 87

Table of Contents
Sally Holdings, Inc. and Subsidiaries
(A Wholly-Owned Subsidiary of Alberto-Culver Company)
Notes to Consolidated Financial Statements
Geographic data for the fiscal years ended September 30, 2006, 2005 and 2004 is as follows (in thousands):
Geographic Area Information
2006 2005 2004
Net sales*:
United States $ 2,106,525 $ 2,007,947 $ 1,871,988
Foreign 266,575 246,360 225,679
$ 2,373,100 $ 2,254,307 $ 2,097,667
Identifiable assets:
United States $ 1,114,151 $ 1,019,873 $ 911,289
Foreign 213,900 171,400 155,622
Corporate** 10,790 34,234 35,517
$ 1,338,841 $ 1,225,507 $ 1,102,428
*
Net sales are attributable to individual countries based on the location of the customer.
**
Corporate identifiable assets consist of amounts due from Alberto-Culver, deferred tax assets and notes
receivable from affiliated companies.
19. Subsequent Events
On November 16, 2006, the Company completed its separation from Alberto-Culver. In connection with the transaction and as
provided in the investment agreement, CDRS Acquisition LLC, an investment fund organized by Clayton Dubilier & Rice VII, L.P.,
and CD&R Parallel Fund L.P. invested an aggregate of $575 million for an equity interest representing approximately 47.6% of the
common stock on a fully diluted basis. The Company through its subsidiaries incurred $1,850.0 million of indebtedness by drawing on
a revolving (asset-based lending) facility in an amount equal to $70.0 million and two term loan facilities in an aggregate amount of
$1,070.0 million, as well as by issuing senior notes in an aggregate amount of $430.0 million and senior subordinated notes in an
aggregate amount of $280.0 million.
Proceeds from the debt were used to pay the $25.00 per share special cash dividend to holders of record of Alberto-Culver
stockholders and for certain expenses associated with the agreement. On November 16, 2006, the Company paid Alberto-Culver
approximately $20.4 million and Clayton Dubilier & Rice, Inc. $30.0 million, as well as paid other expenses called for under the
agreement. These payments are being expensed during the first quarter-ended December 31, 2006. In addition, all intercompany
receivables, payables and loans between the Company and Alberto-Culver have been canceled, except for those specifically
designated to survive the agreement.
The term loan facilities and asset-backed lending facility are secured by substantially all of the assets of the Company and its
subsidiaries. The term loan credit facilities may be prepaid at the Company’ s option at any time without premium or penalty and are
subject to mandatory prepayment in an amount equal to 50% of excess cash flow (as defined in the agreements) for any fiscal year
(commencing in fiscal year 2008) unless a specified leverage ratio is met and 100% of the proceeds of specified asset sales that are not
reinvested in the business or applied to repay borrowings under the asset-based lending credit facility.
The notes are unsecured obligations of the issuers and are guaranteed on a senior basis (in the case of the senior notes) and on a senior
subordinated basis (in the case of the senior subordinated notes) by each material domestic subsidiary of the Company. The senior
notes and the senior subordinated notes carry optional redemption features whereby the Company has the option to redeem the notes
on or before November 15, 2010 and November 15, 2011, respectively, at par plus a premium, plus accrued and unpaid interest, and
on or after November 15, 2010 and November 15, 2011, respectively, at par plus a premium declining ratably to par, plus accrued and
unpaid interest.
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