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Jarden Corporation
Notes to Consolidated Financial Statements (cont’d)
December 31, 2004
The estimated amortization expense for each of the five succeeding fiscal years is as follows: $1.4
million in 2005; $1.0 million in 2006; $0.9 million in 2007; $0.9 million in 2008; and $0.3 million in
2009.
Approximately $226.9 million of the goodwill and other intangible assets recorded by the Company
are not deductible for income tax purposes.
In accordance with SFAS No. 142, the Company performs annual impairment testing on its
intangible assets. The Company performs this testing as of October 1 each year. During the years ended
December 31, 2004, 2003 and 2002, the Company did not record goodwill amortization and did not
experience any impairment losses.
8. Debt and Interest
Debt was comprised of the following:
As of December 31,
(thousands of dollars) 2004 2003
9
3
⁄
4
% Senior Subordinated Notes ....................... $179,871 $179,853
Term A.............................................. 39,341 49,934
Term B .............................................. 148,125 149,625
Term B Add-on ....................................... 115,420 —
Other ............................................... 1,524 5,420
Non-debt balances arising from interest rate swap activity .... 3,170 2,550
487,451 387,382
Less current portion ................................... (16,951) (17,512)
Total long-term debt .............................. $470,500 $369,870
2004 Activity
On June 28, 2004, in connection with its USPC Acquisition, the Company completed a $116 million
add-on to its Term B loan facility (“Term B Add-on”) under its Second Amended Credit Agreement. The
proceeds from the Term B Add-on offering were used to partially fund the USPC Acquisition. The
spread on the Term B Add-on is 2.25% over London Interbank Offered Rate (“LIBOR”). Additionally,
under this Second Amended Credit Agreement, the spread on the Company’s existing Term B loan
facility was reduced from 2.75% over LIBOR to 2.25% over LIBOR.
The Second Amended Credit Agreement did not significantly change the restrictions on the
conduct of the Company’s business or the financial covenants required in the previous senior credit
facility (“Amended Credit Agreement”) (see “2003 Activity” below). The Second Amended Credit
Agreement, which matures on April 24, 2008, also did not change the pricing and principal terms of the
$70 million revolving credit facility.
As of December 31, 2004, other debt primarily consisted of $1.5 million of bank notes that are
payable in equal quarterly installments through April 2007 with rates of interest at Euro Interbank
Offered Rate plus 1.00%. In April 2004, the Company repaid the remaining seller debt financing
incurred in connection with a 2002 acquisition, which included both principal and accrued interest
thereon, in the amount of approximately $5.4 million.
58