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8-K
ICONIX BRAND GROUP, INC. filed this Form 8-K on 11/09/2018
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Balance Sheet and Liquidity:

  

($, 000's)  September 30, 2018   December 31, 2017 
Cash Summary:          
Unrestricted Domestic Cash (wholly owned)   52,021    38,236 
Unrestricted Domestic Cash (in consolidated JV's)   5,945    14,943 
Unrestricted International Cash*   8,492    12,748 
Restricted Cash   21,174    48,766 
           
Total Cash  $87,632   $114,693 
           
Debt Summary:          
Senior Secured Notes due January 2020**   376,154    408,174 
1.50% Convertible Notes   -    236,183 
5.75% Convertible Notes due August 2023   111,015    - 
Variable Funding Note due January 2020   100,000    100,000 
2017 Senior Secured Term Loan due August 2022   190,385    82,837 
           
Total Debt (Face Value)  $777,554   $827,194 

 

*- During the second quarter of 2018, the Company elected to treat its Luxembourg top tier subsidiary ("Luxco") as a disregarded entity for US tax purposes. As of the election date, all the foreign operations under LuxCo will be treated as a branch for US tax purposes and subject to US taxation. As such, the Company will no longer have any earnings in foreign subsidiaries that are not currently subject to taxation for US purposes. Before the election, the Company was indefinitely reinvested in all earnings in its foreign subsidiaries.

 

**- The Company's Senior Secured Notes include a test that measures the amount of principal and interest required to be paid on the debt to the approximate cash flow available to pay such principal and interest; the test is referred to as the debt service coverage ratio ("DSCR"). As a result of a decline in royalty collections during the twelve months ended June 30, 2018, the DSCR fell below 1.45x as of June 30, 2018. Beginning July 1, 2018, we are required to allocate 25% of residual royalty collections (i.e. collections less debt service, management, servicing, administrative and other fees) to a restricted reserve account administered by the securitization program's trustee, which will result in cash remaining inside the securitization program. Beginning October 1, 2018, the Co-Issuers are required to allocate 50% of residual royalty collections (i.e. collections less debt service, management, servicing, administrative and other fees) to a restricted reserve account administered by the securitization program's trustee, which will result in cash remaining inside the securitization program and not being distributed to the Company. The cash required to be maintained inside the securitization program may be released to the Company if the DSCR is at least 1.45x for two consecutive quarters.

 

The Company currently projects compliance with all debt covenants.

 

 

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