Sally Beauty Supply 2013 Annual Report Download - page 129

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Sally Beauty Holdings, Inc. and Subsidiaries
Notes to Consolidated Financial Statements (Continued)
Fiscal Years ended September 30, 2013, 2012 and 2011
On July 26, 2013, the Company, Sally Holdings and other parties to the ABL facility entered into a second
amendment to the ABL facility which, among other things, increased the maximum availability under the
ABL Facility to $500.0 million (subject to borrowing base limitations), reduced pricing, relaxed the
restrictions regarding the making of Restricted Payments, extended the maturity to July 26, 2018 and
improved certain other covenant terms. At September 30, 2013, borrowings outstanding under the ABL
facility were $76.0 million (which we intend to repay in the foreseeable future with cash from operations)
and the Company had $382.3 million available for borrowing under the ABL facility, including the
Canadian sub-facility. Borrowings under the ABL facility are secured by substantially all of our assets,
those of Sally Investment, those of our domestic subsidiaries, those of our Canadian subsidiaries (in the
case of borrowings under the Canadian sub-facility) and a pledge of certain intercompany notes. In
addition, the terms of the ABL facility contain a commitment fee of 0.25% on the unused portion of the
facility.
In the fiscal year ended September 30, 2012, the Company issued $750.0 million aggregate principal
amount of its 6.875% Senior Notes due 2019 (the ‘‘senior notes due 2019’’) and $850.0 million aggregate
principal amount of its 5.75% Senior Notes due 2022 (the ‘‘senior notes due 2022’’), including notes in the
aggregate principal amount of $150.0 million which were issued at par plus a premium. Such premium is
being amortized over the term of the notes using the effective interest method. The net proceeds from such
debt issuances were used to retire outstanding indebtedness in the aggregate principal amount of
approximately $1,391.9 million and for general corporate purposes.
The senior notes due 2019 and the senior notes due 2022 (together, the ‘‘senior notes due 2019-2022’’) are
unsecured obligations of Sally Holdings and Sally Capital Inc. (together, the ‘‘Issuers’’) and are jointly and
severally guaranteed by the Company and Sally Investment, and by each material domestic subsidiary of
the Company. Interest on the senior notes due 2019-2022 is payable semi-annually. Please see Note 19 for
certain condensed financial statement data pertaining to Sally Beauty, the Issuers, the guarantor
subsidiaries and the non-guarantor subsidiaries.
The senior notes due 2019 carry optional redemption features whereby the Company has the option to
redeem the notes, in whole or in part, on or after November 15, 2017 at par, plus accrued and unpaid
interest, if any, and on or after November 15, 2015 at par plus a premium declining ratably to par, plus
accrued and unpaid interest, if any. Prior to November 15, 2015, the notes may be redeemed, in whole or in
part, at a redemption price equal to par plus a make-whole premium as provided in the indenture, plus
accrued and unpaid interest, if any. In addition, on or prior to November 15, 2014, the Company has the
right to redeem at par plus a specified premium, plus accrued and unpaid interest, if any, up to 35% of the
aggregate principal amount of notes originally issued, subject to certain limitations, with the proceeds from
certain kinds of equity offerings, as defined in the indenture.
The senior notes due 2022 carry optional redemption features whereby the Company has the option to
redeem the notes, in whole or in part, on or after June 1, 2020 at par, plus accrued and unpaid interest, if
any, and on or after June 1, 2017 at par plus a premium declining ratably to par, plus accrued and unpaid
interest, if any. Prior to June 1, 2017, the notes may be redeemed, in whole or in part, at a redemption
price equal to par plus a make-whole premium as provided in the indenture, plus accrued and unpaid
interest, if any. In addition, on or prior to June 1, 2015, the Company has the right to redeem at par plus a
specified premium, plus accrued and unpaid interest, if any, up to 35% of the aggregate principal amount
of notes originally issued, subject to certain limitations, with the proceeds from certain kinds of equity
offerings, as defined in the indenture.
F-27