Sally Beauty Supply 2011 Annual Report Download - page 58

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loan facilities) for any fiscal year unless a specified leverage ratio is met. Amounts paid pursuant to said
provision may be applied, at the option of the Company, against minimum loan repayments otherwise
required of us over the twelve-month period following any such payment under the terms of the loan
agreement. Additionally, borrowings under the term loan facility are subject to mandatory repayment in an
amount equal to 100% of the proceeds of specified asset sales that are not reinvested in the business or
applied to repay borrowings under the ABL credit facility. No mandatory repayments of any kind were
made or required to be made in the fiscal year 2011. Please see ‘‘Liquidity and Capital Resources’’ for
additional information about our borrowings under the term loan facilities and optional prepayments
thereof.
Our Notes are unsecured obligations of Sally Holdings and its co-issuer 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 Sally Holdings (other than the co-issuer).
Interest on the Notes is payable semi-annually. The senior notes carry optional redemption features
whereby the Company has the option to redeem the notes prior to maturity after November 2010 at par
plus a premium declining ratably to par, plus accrued and unpaid interest. The senior subordinated notes
carry optional redemption features whereby the Company, at September 30, 2011, has the option to
redeem the notes before November 15, 2011 at par plus a premium, plus accrued and unpaid interest; and
on or after November 15, 2011 at par plus a premium declining ratably to par, plus accrued and unpaid
interest. Please see Note 21 of the ‘‘Notes to Consolidated Financial Statements’’ in Item 8—‘‘Financial
Statements and Supplementary Data’’ contained elsewhere in this Annual Report.
Details of long-term debt (excluding capitalized leases) as of September 30, 2011 are as follows (dollars in
thousands):
Amount Maturity Dates Interest Rates
ABL facility . . $ — Nov. 2015 (i) Prime plus (1.25% to 1.75%) or;
(ii) LIBOR(a) plus (2.25% to 2.75%)
Term loan B . . 696,856 Nov. 2013 (i) Prime plus (1.25% to 1.50%) or;
(ii) LIBOR plus (2.25% to 2.50%)(b)
Other(c) ..... 4,774 2012-2015 4.05% to 7.00%
Total ...... $701,630
Senior notes . . $430,000 Nov. 2014 9.25%
Senior
subordinated
notes ...... 275,000 Nov. 2016 10.50%
Total ...... $705,000
(a) London Interbank Offered Rate (‘‘LIBOR’’).
(b) At September 30, 2011, the contractual interest rate for the term loan B was 2.49%. The
interest rate on $300.0 million of this loan is fixed by interest rate swaps which expire in May
2012.
(c) Represents pre-acquisition debt of Pro-Duo NV and Sinelco.
Other Significant Items
Derivative Instruments
As a multinational corporation, we are subject to certain market risks including changes in market interest
rates and foreign currency fluctuations. We may consider a variety of practices in the ordinary course of
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