XML 71 R16.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Senior Debt | 12 Months Ended
--- | ---
Dec. 31, 2013
Senior Debt [Abstract] |
Senior Debt | Note G — Senior Debt Our $750.0 million senior credit facilities consist of a $250.0 million, five-year term loan and a $500.0 million, five-year revolving credit facility. The debt facilities as of December 31, 2013 and 2012 are as follows:
|  |  |  | December 31, 2013 |  | December 31, 2012
|  | Facility Maturity |  | Maximum Facility |  | Amount Outstanding |  | Amount Available |  | Maximum Facility |  | Amount Outstanding |  | Amount Available
|  |  |  | (In thousands)
Senior Credit Facilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Term Loan |  | July 14, 2016 |  | $ | 250,000 |  |  | $ | 187,500 |  |  | $ | — |  |  | $ | 250,000 |  |  | $ | 212,500 |  |  | $ | — |
Revolving Facility |  | July 14, 2016 |  | 500,000 |  |  | 160,500 |  |  | 234,830 |  |  | 500,000 |  |  | 175,000 |  |  | 215,405 |
|  |  |  | 750,000 |  |  | 348,000 |  |  | 234,830 |  |  | 750,000 |  |  | 387,500 |  |  | 215,405 |
Other Indebtedness: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Line of credit |  |  |  | 20,000 |  |  | 18,275 |  |  | 1,725 |  |  | 20,000 |  |  | — |  |  | 20,000 |
Total |  |  |  | $ | 770,000 |  |  | $ | 366,275 |  |  | $ | 236,555 |  |  | $ | 770,000 |  |  | $ | 387,500 |  |  | $ | 235,405 |
The full amount of the revolving credit facility may be used for the issuance of letters of credit. At December 31, 2013 and 2012, the amounts available under the revolving credit facility were reduced by approximately $104.7 million and $109.6 million, respectively, for our outstanding letters of credit. Borrowings under our senior credit facility accrue interest at varying rates equal to, at our election, either (y) the prime rate plus 0.50% to 1.50%; or (z) the Eurodollar rate plus 1.50% to 2.50%. Interest periods range from seven days (for borrowings under the revolving credit facility only) to one, two, three or six months, at our election. The margins on the Eurodollar rate and on the prime rate, which were 2.25% and 1.25% respectively, at December 31, 2013, may fluctuate dependent upon an increase or decrease in our consolidated leverage ratio as defined by a pricing grid included in the amended credit agreement, and the weighted average margins for the year ended December 31, 2013, were 2.08% and 1.08%, respectively. We have not entered into any interest rate protection agreements with respect to term loans under our senior credit facilities. A commitment fee equal to 0.30% to 0.50% of the average daily amount of the available revolving commitment is payable quarterly. Our senior credit facilities are secured by a security interest in substantially all of our tangible and intangible assets, including intellectual property. Our senior credit facilities are also secured by a pledge of the capital stock of our wholly-owned U.S. subsidiaries (other than certain specified subsidiaries). Our senior credit facilities contain, without limitation, covenants that generally limit our ability to:
• | incur additional debt in excess of $250.0 million at any one time outstanding (other than subordinated debt, which is generally permitted if the maturity date is later than July 14, 2017);
• | repurchase our capital stock and 6.625% notes and 4.75% notes and pay cash dividends in the event the pro forma senior leverage ratio is greater than 2.50 x (on February 20, 2014, we obtained a waiver from the lenders under our senior credit facilities to permit the declaration and payment of a cash dividend with respect to the second quarter of 2014);
• | incur liens or other encumbrances;
• | merge, consolidate or sell substantially all our property or business;
• | sell assets, other than inventory, in the ordinary course of business;
• | make investments or acquisitions unless we meet financial tests and other requirements;
• | make capital expenditures in the event the pro forma consolidated leverage ratio is greater than 2.75 x; or
• | enter into an unrelated line of business.
Our senior credit facilities require us to comply with several financial covenants. The table below shows the required and actual ratios under our credit facilities calculated as of December 31, 2013:
| Required Ratio |  | Actual Ratio
Maximum consolidated leverage ratio | No greater than |  | 3.25:1 |  | 2.64:1
Minimum fixed charge coverage ratio | No less than |  | 1.35:1 |  | 1.38:1
These financial covenants, as well as the related components of their computation, are defined in the amended and restated credit agreement governing our senior credit facility, which is included as an exhibit to our Current Report on Form 8-K dated as of July 14, 2011. In accordance with the credit agreement, the maximum consolidated leverage ratio was calculated by dividing the consolidated funded debt outstanding at December 31, 2013 ($880.7 million) by consolidated EBITDA for the 12-month period ending December 31, 2013 ($334.1 million). For purposes of the covenant calculation, (i) “consolidated funded debt” is defined as outstanding indebtedness less cash in excess of $25.0 million, and (ii) “consolidated EBITDA” is generally defined as consolidated net income (a) plus the sum of income taxes, interest expense, depreciation and amortization expense, extraordinary non-cash expenses or losses, and other non-cash charges, and (b) minus the sum of interest income, extraordinary income or gains, other non-cash income, and cash payments with respect to extraordinary non-cash expenses or losses recorded in prior fiscal quarters. Consolidated EBITDA is a non-GAAP financial measure that is presented not as a measure of operating results, but rather as a measure used to determine covenant compliance under our senior credit facilities. The minimum fixed charge coverage ratio was calculated pursuant to the credit agreement by dividing consolidated EBITDA for the 12-month period ending December 31, 2013, as adjusted for certain capital expenditures ($485.1 million), by consolidated fixed charges for the 12-month period ending December 31, 2013 ($351.5 million). For purposes of the covenant calculation, “consolidated fixed charges” is defined as the sum of interest expense, lease expense, cash dividends, and mandatory debt repayments. Events of default under our senior credit facilities include customary events, such as a cross-acceleration provision in the event that we default on other debt. In addition, an event of default under the senior credit facility would occur if a change of control occurs. This is defined to include the case where a third party becomes the beneficial owner of 35% or more of our voting stock or certain changes in Rent-A-Center’s Board of Directors occurs. An event of default would also occur if one or more judgments were entered against us of $50.0 million or more and such judgments were not satisfied or bonded pending appeal within 30 days after entry. We utilize our revolving credit facility for the issuance of letters of credit, as well as to manage normal fluctuations in operational cash flow caused by the timing of cash receipts. In that regard, we may from time to time draw funds under the revolving credit facility for general corporate purposes. The funds drawn on individual occasions have varied in amounts of up to $100.0 million, which occurred at the date we refinanced our senior secured debt, with total amounts outstanding ranging up to $221.0 million. Amounts are drawn as needed due to the timing of cash flows and are generally paid down as cash is generated by our operating activities. The table below shows the scheduled maturity dates of our senior debt outstanding at December 31, 2013.
Year Ending December 31, | (In thousands)
2014 | $ | 43,275 |
2015 | 25,000 |
2016 | 298,000 |
| $ | 366,275 |

X
- Details
Name: | rcii_SeniorDebtAbstract
Namespace Prefix: | rcii_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 19, 20, 22 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
Name: | us-gaap_DebtDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration