Note 4 – Long-Term Debt

Long-term debt consists of the following:

	April 1, 2017			December 31, 2016

Credit facility	$	163,000		$	143,000
Convertible senior debentures, due 2040		108,697			108,120
Convertible senior debentures, due 2041		55,752			55,442
Convertible senior debentures, due 2042		61,638			61,341
Deferred financing costs		(10,435	)		(10,880	)
		378,652			357,023
Less current portion		-			-
	$	378,652		$	357,023

Convertible Senior Debentures

Vishay currently has three issuances of convertible senior debentures outstanding with generally congruent terms. The quarterly cash dividend program of the Company results in adjustments to the conversion rate and effective conversion price for each issuance of the Company's convertible senior debentures effective as of the ex-dividend date of each cash dividend.

The following table summarizes some key facts and terms regarding the three series of outstanding convertible senior debentures following the adjustment made to the conversion rate of the debentures on the ex-dividend date of the March 29, 2017 dividend payment:

	Due 2040			Due 2041			Due 2042
Issuance date	November 9, 2010			May 13, 2011			May 31, 2012
Maturity date	November 15, 2040			May 15, 2041			June 1, 2042
Principal amount	$	275,000		$	150,000		$	150,000
Cash coupon rate (per annum)		2.25	%		2.25	%		2.25	%
Nonconvertible debt borrowing rate at issuance (per annum)		8.00	%		8.375	%		7.50	%
Conversion rate effective March 10, 2017 (per $1 principal amount)		76.4157			55.7641			89.8466
Effective conversion price effective March 10, 2017 (per share)	$	13.09		$	17.93		$	11.13
130% of the conversion price (per share)	$	17.02		$	23.31		$	14.47
Call date	November 20, 2020			May 20, 2021			June 7, 2022

Prior to three months before the maturity date, the holders may only convert their debentures under the following circumstances: (1) during any fiscal quarter after the first full quarter subsequent to issuance, if the sale price of Vishay common stock reaches 130% of the conversion price for a specified period; (2) the trading price of the debentures falls below 98% of the product of the sale price of Vishay's common stock and the conversion rate for a specified period; (3) Vishay calls any or all of the debentures for redemption, at any time prior to the close of business on the third scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events.

The convertible debentures due 2042 became convertible subsequent to the December 31, 2016 evaluation of the conversion criteria and remain convertible subsequent to the April 1, 2017 evaluation, due to the sale price of Vishay's common stock exceeding 130% of the conversion price for the applicable periods in the fourth fiscal quarter of 2016 and first fiscal quarter of 2017. The debentures due 2042 will remain convertible until July 1, 2017, at which time the conversion criteria will be reevaluated. At the direction of its Board of Directors, the Company intends, upon future conversion of any of the convertible senior debentures, to repay the principal amounts of the convertible senior debentures in cash and settle any additional amounts in shares of Vishay common stock. The excess of the amount that the Company would pay to the holders of the debentures due 2042 upon conversion over the carrying value of the liability component of the debentures currently convertible has been reclassified as temporary equity on the consolidated condensed financial statements. The Company intends to finance the principal amount of any converted debentures using borrowings under its credit facility. Accordingly, the debt component of the convertible debentures due 2042 continues to be classified as a non-current liability on the consolidated condensed balance sheets.

GAAP requires an issuer to separately account for the liability and equity components of the instrument in a manner that reflects the issuer's nonconvertible debt borrowing rate when interest costs are recognized in subsequent periods. The resulting discount on the debt is amortized as non-cash interest expense in future periods.

The carrying values of the liability and equity components of the convertible debentures are reflected in the Company's consolidated condensed balance sheets as follows:

	Principal amount of the debentures		Unamortized discount			Embedded derivative		Carrying value of liability component		Equity component (including temporary equity) - net carrying value
April 1, 2017
Due 2040	$	275,000		(166,671	)		368	$	108,697	$	110,094
Due 2041	$	150,000		(94,535	)		287	$	55,752	$	62,246
Due 2042	$	150,000		(88,534	)		172	$	61,638	$	57,874
Total	$	575,000	$	(349,740	)	$	827	$	226,087	$	230,214

December 31, 2016
Due 2040	$	275,000		(167,273	)		393	$	108,120	$	110,094
Due 2041	$	150,000		(94,843	)		285	$	55,442	$	62,246
Due 2042	$	150,000		(88,835	)		176	$	61,341	$	57,874
Total	$	575,000	$	(350,951	)	$	854	$	224,903	$	230,214

Interest is payable on the debentures semi-annually at the cash coupon rate; however, the remaining debt discount is being amortized as additional non-cash interest expense using an effective annual interest rate equal to the Company's estimated nonconvertible debt borrowing rate at the time of issuance. In addition to ordinary interest, contingent interest will accrue in certain circumstances relating to the trading price of the debentures and under certain other circumstances beginning ten years subsequent to issuance.

Interest expense related to the debentures is reflected on the consolidated condensed statements of operations for the fiscal quarters ended:

	Contractual coupon interest		Non-cash amortization of debt discount		Non-cash amortization of deferred financing costs		Non-cash change in value of derivative liability			Total interest expense related to the debentures
April 1, 2017
Due 2040	$	1,547		602		22		(25	)	$	2,146
Due 2041	$	844		308		12		2		$	1,166
Due 2042	$	844		301		13		(4	)	$	1,154
Total	$	3,235	$	1,211	$	47	$	(27	)	$	4,466

April 2, 2016
Due 2040	$	1,547		556		22		6		$	2,131
Due 2041	$	844		284		11		38		$	1,177
Due 2042	$	844		280		13		(17	)	$	1,120
Total	$	3,235	$	1,120	$	46	$	27		$	4,428