Cabela's 2010 Annual Report Download - page 98

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CABELA’S INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Thousands Except Share and Per Share Amounts)
On February 12, 2010, the Trust sold $300,000 of asset-backed notes, Series 2010-I. This securitization
transaction included the issuance of $255,000 of Class A notes which are eligible collateral under the Term
Asset-Backed Securities Loan Facility (“TALF”) established by the Federal Reserve Bank of New York. This
securitization transaction also included the issuance of three subordinated classes of notes in the aggregate
principal amount of $45,000. WFB retained each of the subordinated classes of notes which were eliminated in the
preparation of the consolidated financial statements. Each class of notes issued in the securitization transaction has
an expected life of approximately five years, and with a contractual maturity of approximately eight years. This
securitization transaction was used to refinance asset-backed notes issued by the Trust that matured in 2010 and to
fund growth in restricted credit card loans.
On September 22, 2010, the Trust sold $250,000 of asset-backed notes, Series 2010-II. This securitization
transaction included the issuance of $212,500 of Class A notes and three subordinated classes of notes in the
aggregate principal amount of $37,500. WFB retained each of the subordinated classes of notes which were
eliminated in the preparation of consolidated financial statements. Each class of notes issued in the securitization
transaction has an expected life of approximately five years, with a contractual maturity of approximately eight
years. The securitization transaction was used to refinance asset-backed notes issued by the Trust that matured in
2010 and to fund growth in restricted credit card loans.
WFB has unsecured federal funds purchase agreements with two financial institutions. The maximum
amount that can be borrowed is $85,000. There were no amounts outstanding at January 1, 2011, or January 2,
2010. During 2010 and 2009, the daily average balance outstanding was $649 and $151 with a weighted average rate
of 0.83% and 0.22%, respectively.
13. REVOLVING CREDIT FACILITIES
Effective December 11, 2009, the Company decreased its unsecured revolving credit facility to $350,000
from $430,000. In addition, the terms of the credit agreement were amended to allow Cabela’s to contribute up
to $225,000 of capital to WFB in 2010 plus up to $25,000 of capital per year through June 30, 2012, when this
credit agreement expires. All other terms of the credit agreement remained unchanged. The credit facility may be
increased to $450,000 and permits the issuance of up to $200,000 in letters of credit and standby letters of credit,
which reduce the overall credit limit available under the credit facility.
There were no amounts outstanding at January 1, 2011, and January 2, 2010, under this credit agreement.
During 2010 and 2009, the daily average principal balance outstanding on the line of credit was $30,256 and $85,437,
respectively, and the weighted average interest rate was 1.39% and 1.71%, respectively. Letters of credit and standby
letters of credit totaling $17,579 and $11,394, respectively, were outstanding at the end of 2010 and 2009. The daily
average outstanding amount of total letters of credit during 2010 and 2009 was $17,784 and $11,050, respectively.
During the term of the facility, the Company is required to pay a quarterly facility fee, which ranges from
0.10% to 0.25% of the average daily unused principal balance on the line of credit. Interest on advances on this
credit facility is determined at the greater of:
• the lead lender’s prime rate,
• the average rate on the federal funds rate in effect for the day plus one-half of one percent, or
• the Eurodollar rate of interest plus a margin, as defined.
The credit agreement requires that Cabela’s comply with certain financial and other customary covenants,
including:
• a fixed charge coverage ratio (as defined) of no less than 1.5 to 1 as of the last day of any quarter;
• a cash flow leverage ratio (as defined) of no more than 3.0 to 1 as of the last day of any quarter; and
• a minimum tangible net worth standard (as defined).