|
Long Term Debt (Tables)
|
12 Months Ended |
|
Dec. 31, 2012
|
| Long-term debt |
|
| Long-term debt |
Long-term debt consists of the following:
| |
|
|
|
|
|
|
|
|
| |
|
December 31, |
|
| |
|
2012 |
|
|
2011 |
|
| |
|
(In thousands) |
|
|
2011 Revolving Credit Facility(1)
|
|
$ |
6,176 |
|
|
$ |
— |
|
|
9.0% Senior Subordinated Notes due 2018 (the “9.0% Notes”)
|
|
|
210,000 |
|
|
|
210,000 |
|
|
7.0% Senior Subordinated Notes due 2022 (the “7.0% Notes”)
|
|
|
200,000 |
|
|
|
— |
|
|
5.0% Convertible Senior Notes due 2029, redeemable in 2014 (the “5.0% Convertible Notes”)(2)
|
|
|
— |
|
|
|
155,055 |
|
|
Notes payable to a finance company bearing interest from 9.52% to 10.52% (with a weighted average of 10.19%)
|
|
|
10,572 |
|
|
|
13,223 |
|
|
Mortgage notes to finance companies-fixed rate, bearing interest from 4.07% to 7.03%
|
|
|
137,791 |
|
|
|
116,584 |
|
|
Mortgage notes to finance companies-variable rate, bearing interest at 1.25 to 3.50 percentage points above one-month
LIBOR
|
|
|
62,229 |
|
|
|
65,640 |
|
|
Net debt discount and premium(3)
|
|
|
(2,814 |
) |
|
|
(18,635 |
) |
|
Other
|
|
|
5,431 |
|
|
|
5,752 |
|
| |
|
|
|
|
|
|
|
|
|
Total debt
|
|
$ |
629,385 |
|
|
$ |
547,619 |
|
|
Less current maturities
|
|
|
(18,587 |
) |
|
|
(11,608 |
) |
| |
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
$ |
610,798 |
|
|
$ |
536,011 |
|
| |
|
|
|
|
|
|
|
|
| (1) |
The interest rate on the revolving credit facility was 2.25% above LIBOR at December 31, 2012 and 2.25% above LIBOR at December 31, 2011.
|
| (2) |
See the heading “5.0% Senior Convertible Notes” below for further discussion. |
| (3) |
December 31, 2012 includes $1.1 million discount associated with the 9.0% Notes, $1.7 million discount associated with the 7.0% Notes, $0.7 million premium
associated with notes payable to a finance company and $0.7 million discount associated with mortgage notes payable. December 31, 2011 includes $1.2 million discount associated with the 9.0% Notes, $17.7 million discount associated with
the 5.0% Convertible Notes, $1.2 million premium associated with notes payable to a finance company and $0.9 million discount associated with mortgage notes payable. |
|
| Future maturities of long term-debt |
Future maturities of long-term debt are as follows:
| |
|
|
|
|
|
|
|
|
|
Year Ending December 31,
|
|
Principal |
|
|
Net of
Discount/
Premium |
|
| |
|
(In thousands) |
|
|
2013
|
|
$ |
18,299 |
|
|
$ |
18,587 |
|
|
2014
|
|
|
15,532 |
|
|
|
15,565 |
|
|
2015
|
|
|
25,964 |
|
|
|
25,890 |
|
|
2016
|
|
|
49,656 |
|
|
|
49,526 |
|
|
2017
|
|
|
29,790 |
|
|
|
29,655 |
|
|
Thereafter
|
|
|
492,958 |
|
|
|
490,162 |
|
| |
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
632,199 |
|
|
$ |
629,385 |
|
| |
|
|
|
|
|
|
|
|
|
| Recorded carrying values of associated accounts prior to extinguishment of 5.0 % Convertible Notes |
Immediately prior to extinguishment, the recorded carrying values of
associated accounts were as follows:
| |
|
|
|
|
| |
|
Carrying
Value |
|
| |
|
(In thousands) |
|
|
5.0% Convertible Notes
|
|
$ |
155,050 |
|
|
Unamortized debt discount and deferred loan costs
|
|
|
(16,797 |
) |
| |
|
|
|
|
|
Net carrying value
|
|
$ |
138,253 |
|
| |
|
|
|
|
|
| Summary of the effect on financial statement balances due to extinguishment of 5.0 % Convertible Notes |
A summary of the effect on financial statement balances is provided below:
| |
|
|
|
|
| |
|
Debit (Credit) |
|
| |
|
(In thousands) |
|
|
5.0% Convertible Notes (write-off of principal)
|
|
$ |
155,050 |
|
|
Other assets (write-off of unamortized debt discount and deferred loan costs)
|
|
|
(16,797 |
) |
|
Cash (cash paid to repurchase 5.0% Convertible Notes)
|
|
|
(164,896 |
) |
|
Loss on debt extinguishment (fair value less carrying value)
|
|
|
18,473 |
|
|
Paid-in capital (stock issuance of 4.1 million shares at $16.6554 per share)
|
|
|
(67,869 |
) |
|
Paid-in capital (conversion option)
|
|
|
76,039 |
|
|
Paid-in capital (conversion option tax effect)
|
|
|
662 |
|
|
Deferred income tax liability
|
|
|
(662 |
) |
|
Loss on debt extinguishment (allocated expenses)
|
|
|
1,240 |
|
|
Cash (allocated expenses related to debt extinguishment)
|
|
|
(1,240 |
) |
|
Paid-in capital (allocated expenses related to stock issuance)
|
|
|
333 |
|
|
Cash (allocated expenses related to stock issuance)
|
|
|
(333 |
) |
|
| Financial covenants include required specified ratios |
Sonic was in compliance with the covenants under the 2011 Credit Facilities as of
December 31, 2012. Financial covenants include required specified ratios (as each is defined in the 2011 Credit Facilities) of:
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Covenant |
|
| |
|
Minimum
Consolidated
Liquidity
Ratio |
|
|
Minimum
Consolidated
Fixed Charge
Coverage
Ratio |
|
|
Maximum
Consolidated
Total Lease
Adjusted Leverage
Ratio |
|
|
Required ratio
|
|
|
1.05 |
|
|
|
1.20 |
|
|
|
5.50 |
|
|
December 31, 2012 actual
|
|
|
1.15 |
|
|
|
1.69 |
|
|
|
3.94 |
|
|
| Summary of interest received and paid under term of cash flow swap |
Under the terms of these cash flow swaps, Sonic will receive and pay interest based on the following:
| |
|
|
|
|
|
|
|
Notional
Amount
|
|
Pay Rate
|
|
Receive Rate
(1)
|
|
Maturing
Date
|
| (In millions) |
|
|
|
|
|
|
|
$ 3.2
|
|
7.100% |
|
one-month LIBOR + 1.50% |
|
July 10, 2017 |
|
$ 9.9
|
|
4.655% |
|
one-month LIBOR |
|
December 10, 2017 |
|
$ 8.1(2)
|
|
6.860% |
|
one-month LIBOR + 1.25% |
|
August 1, 2017 |
|
$ 6.1
|
|
4.330% |
|
one-month LIBOR |
|
July 1, 2013 |
|
$100.0
|
|
3.280% |
|
one-month LIBOR |
|
July 1, 2015 |
|
$100.0
|
|
3.300% |
|
one-month LIBOR |
|
July 1, 2015 |
|
$ 6.8(2)
|
|
6.410% |
|
one-month LIBOR + 1.25% |
|
September 12, 2017 |
|
$ 50.0
|
|
2.767% |
|
one-month LIBOR |
|
July 1, 2014 |
|
$ 50.0
|
|
3.240% |
|
one-month LIBOR |
|
July 1, 2015 |
|
$ 50.0
|
|
2.610% |
|
one-month LIBOR |
|
July 1, 2014 |
|
$ 50.0
|
|
3.070% |
|
one-month LIBOR |
|
July 1, 2015 |
|
$100.0(3)
|
|
2.065% |
|
one-month LIBOR |
|
June 30, 2017 |
|
$100.0(3)
|
|
2.015% |
|
one-month LIBOR |
|
June 30, 2017 |
| (1) |
The one-month LIBOR rate was 0.209% at December 31, 2012. |
| (2) |
Changes in fair value are recorded through earnings. |
| (3) |
The effective date of these forward-starting swaps is July 1, 2015. |
|
|
9.0% Senior Subordinate Note due 2018 [Member]
|
|
| Long-term debt |
|
| Redemption price, percentage |
Sonic may redeem the 9.0% Notes in whole or in part at any time after March 15, 2014 at the following redemption prices, which are expressed as percentages of the principal amount:
| |
|
|
|
|
| |
|
Redemption
Price |
|
|
Beginning on March 15, 2014
|
|
|
104.50 |
% |
|
Beginning on March 15, 2015
|
|
|
102.25 |
% |
|
Beginning on March 15, 2016 and thereafter
|
|
|
100.00 |
% |
|
|
Senior Subordinated Notes [Member]
|
|
| Long-term debt |
|
| Redemption price, percentage |
Sonic may redeem the 7.0% Notes in whole or in part at any time after
July 15, 2017 at the following redemption prices, which are expressed as percentages of the principal amount:
| |
|
|
|
|
| |
|
Redemption
Price |
|
|
Beginning on July 15, 2017
|
|
|
103.500 |
% |
|
Beginning on July 15, 2018
|
|
|
102.333 |
% |
|
Beginning on July 15, 2019
|
|
|
101.167 |
% |
|
Beginning on July 15, 2020 and thereafter
|
|
|
100.000 |
% |
|