Business Context and Reporting Period
Company: Red Robin Gourmet Burgers, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: June 30, 2016
Event: Entry into a new material definitive credit agreement and termination of the prior facility.
Key Financial Metrics and Debt Structure
This filing details a refinancing transaction rather than operational financial results. Key debt metrics include:
- New Credit Facility: $400 million revolving line of credit.
- Expansion Option: Borrower may increase the facility by up to an additional $100 million subject to lender participation.
- Maturity Date: June 30, 2021 (extended by two years from the prior facility).
- Security: Borrowings are secured by substantially all assets of the borrower and guarantors.
- Administrative Agent: Wells Fargo Bank, N.A.
Note: The filing text does not provide specific values for revenue, profit, cash flow, margins, or current liquidity ratios.
Material Changes Versus Prior Period
- Termination of Prior Agreement: The existing credit facility dated July 2, 2014, was terminated effective June 30, 2016.
- Refinancing: All outstanding borrowings, accrued interest, and fees under the old facility were paid off using proceeds from the new agreement.
- Term Extension: The maturity date was extended by two years compared to the previous facility.
- Permitted Uses: Funds are available for refinancing indebtedness, restaurant construction, working capital, general corporate requirements, permitted acquisitions, and redemption of capital stock.
Outlook, Risks, and Management Commentary
Management indicates the new facility provides additional flexibility to facilitate future strategic activities intended to enhance stockholder value. The agreement includes standard covenants and security interests, with Red Robin International, Inc. acting as the primary borrower and the Company and certain subsidiaries acting as guarantors.
Investor Verification Checklist
- Review the full text of the Credit Agreement (Exhibit 10.1) for specific financial covenants and interest rate terms.
- Verify the Security Agreement (Exhibit 10.2) to confirm the scope of assets pledged as collateral.
- Check subsequent filings for the actual utilization of the $400 million revolving line.
- Monitor for any future exercises of the $100 million accordion feature to increase the credit limit.