XML 55 R12.htm IDEA: XBRL DOCUMENT v2.4.1.9
CREDIT FACILITY
12 Months Ended
Jan. 31, 2015
Debt Disclosure [Abstract]  
CREDIT FACILITY
CREDIT FACILITY
The Company and certain of its domestic subsidiaries maintain a credit agreement with Wells Fargo Bank, National Association (“Wells Fargo”), Bank of America, N.A., HSBC Business Credit (USA) Inc., and JPMorgan Chase Bank, N.A. as lenders (collectively, the “Lenders”), and Wells Fargo, as Administrative Agent, Collateral Agent and Swing Line Lender (the “Credit Agreement”). The Credit Agreement was amended and restated on March 4, 2014 to incorporate all prior amendments, and the provisions below reflect the amended and restated Credit Agreement.

The Credit Agreement, which expires in August 2018, consists of a $200 million asset based revolving credit facility, with a $50 million sublimit for standby and documentary letters of credit and an uncommitted accordion feature that could provide up to $25 million of additional availability. Revolving credit loans outstanding under the Credit Agreement bear interest, at the Company’s option, at:
(i)
the prime rate plus a margin of 0.50% to 0.75% based on the amount of the Company’s average excess availability under the facility; or
(ii)
the London InterBank Offered Rate, or “LIBOR”, for an interest period of one, two, three or six months, as selected by the Company, plus a margin of 1.50% to 1.75% based on the amount of the Company’s average excess availability under the facility.
The Company is charged an unused line fee of 0.25% on the unused portion of the commitments.  Letter of credit fees range from 0.75% to 0.875% for commercial letters of credit and range from 1.00% to 1.25% for standby letters of credit.  Letter of credit fees are determined based on the amount of the Company's average excess availability under the facility. The amount available for loans and letters of credit under the Credit Agreement is determined by a borrowing base consisting of certain credit card receivables, certain inventory and the fair market value of certain real estate, subject to certain reserves.
The outstanding obligations under the Credit Agreement may be accelerated upon the occurrence of certain events, including, among others, non-payment, breach of covenants, the institution of insolvency proceedings, defaults under other material indebtedness and a change of control, subject, in the case of certain defaults, to the expiration of applicable grace periods.  The Company is not subject to any early termination fees. 
The Credit Agreement contains covenants, which include conditions on stock buybacks and the payment of cash dividends or similar payments.  Credit extended under the Credit Agreement is secured by a first priority security interest in substantially all of the Company’s U.S. assets excluding intellectual property, software, equipment and fixtures.
On March 4, 2014, the Credit Agreement was amended to permit the payment of dividends, subject to certain conditions, to increase the revolving credit limit from $150 million to its current $200 million and to extend the term from August 2017 to August 2018, and was restated to incorporate all prior amendments. In conjunction with this amendment and restatement, the Company paid approximately $0.3 million in additional deferred financing costs.
As of January 31, 2015, the Company has capitalized an aggregate of approximately $4.0 million in deferred financing costs related to the Credit Agreement. The unamortized balance of deferred financing costs at January 31, 2015 was approximately $1.2 million. Unamortized deferred financing costs are amortized over the remaining term of the Credit Agreement.



The table below presents the components (in millions) of the Company’s credit facility:
 
January 31,
2015
 
February 1,
2014
Credit facility maximum
$
200.0

 
$
150.0

Borrowing base
183.2

 
150.0

 
 
 
 
Outstanding borrowings

 

Letters of credit outstanding—merchandise

 
1.2

Letters of credit outstanding—standby
9.1

 
9.9

Utilization of credit facility at end of period
9.1

 
11.1

 
 
 
 
Availability (1)
$
174.1

 
$
138.9

 
 
 
 
Interest rate at end of period
3.8
%
 
3.8
%
 
Fiscal
2014
 
Fiscal
2013
Average end of day loan balance during the period
$
9.4

 
$

Highest end of day loan balance during the period
40.9

 
10.4

Average interest rate
3.2
%
 
3.8
%
____________________________________________
(1)
The sublimit availability for letters of credit was $40.9 million and $113.9 million at January 31, 2015 and February 1, 2014, respectively.

Letter of credit fees were immaterial in Fiscal 2014 and approximated $0.2 million in each of Fiscal 2013 and Fiscal 2012, respectively, and are included in cost of sales.