This excerpt taken from the ROST 10-K filed Apr 14, 2005.
Note C: Long-Term Debt
The Company had $50 million of debt classified as long-term as of January 29, 2005 and January 31, 2004. The weighted average interest rates on borrowings during 2004 and 2003 were 3.1% and 2.7%, respectively.
Bank Credit Facilities. During the quarter ended May 1, 2004, the Company entered into a $600 million revolving credit facility with its banks, which contains a $200 million sublimit for issuances of letters of credit of which $134.2 million was available at January 29, 2005. Interest is LIBOR-based plus an applicable margin (currently 75 basis points) and is payable upon borrowing maturity but no less than quarterly. Borrowing under this credit facility is subject to the Company maintaining certain interest coverage and leverage ratios. As of January 29, 2005, the Company had no borrowings outstanding under this facility. This existing revolving credit facility is scheduled to expire in March 2009.
Term Debt. In June 2002, the Company entered into a $50 million senior unsecured term loan agreement to finance the equipment and information systems for its Southern California distribution center. The Company borrowed $25 million under this term loan in September 2002 and made the final draw of $25 million under this term loan in February 2003. Interest is payable no less than quarterly at the banks applicable prime rate or at LIBOR plus an applicable margin (currently 150 basis points) which resulted in an effective interest rate of 3.9% at January 29, 2005. All amounts outstanding under the term loan are due and payable in December 2006. Borrowing under this term loan is subject to certain operating and financial covenants including maintaining certain interest coverage and leverage ratios.
Letters of Credit. The Company uses standby letters of credit to collateralize certain obligations related to its self-insured workers compensation and general liability claims. The Company had $65.8 million and $67.4 million in standby letters of credit and $17.0 million and $15.4 million in trade letters of credit outstanding at January 29, 2005 and January 31, 2004, respectively.