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Long-term Debt and Letters of Credit
3 Months Ended
Mar. 30, 2020
Debt Disclosure [Abstract]  
Long-term Debt and Letters of Credit

(8) Long-term Debt and Letters of Credit

The following table summarizes the long-term debt of the Company as of March 30, 2020 and December 30, 2019:

 

 

Interest Rate as of

March 30, 2020

 

 

Principal

Outstanding

as of

March 30, 2020

 

 

Interest Rate as of

December 30, 2019

 

 

Principal

Outstanding

as of

December 30, 2019

 

 

 

(In thousands)

 

Term Loan due September 2024

 

 

3.48

 

%

$

805,879

 

 

 

4.28

 

%

$

805,879

 

Senior Notes due October 2025

 

 

5.63

 

 

 

375,000

 

 

 

5.63

 

 

 

375,000

 

Convertible Senior Notes due December 2020

 

 

1.75

 

 

 

249,975

 

 

 

1.75

 

 

 

249,975

 

U.S. ABL Revolving Loan due June 2024

 

 

2.23

 

 

 

40,000

 

 

 

3.03

 

 

 

40,000

 

Asia ABL Revolving Loan due June 2024

 

 

2.38

 

 

 

30,000

 

 

 

3.18

 

 

 

30,000

 

 

 

 

 

 

 

 

1,500,854

 

 

 

 

 

 

 

1,500,854

 

Less: Long-term debt unamortized discount

 

 

 

 

 

 

(9,305

)

 

 

 

 

 

 

(11,943

)

Long-term debt unamortized debt

issuance costs

 

 

 

 

 

 

(12,202

)

 

 

 

 

 

 

(12,974

)

 

 

 

 

 

 

 

1,479,347

 

 

 

 

 

 

 

1,475,937

 

Less: current maturities

 

 

 

 

 

 

(249,975

)

 

 

 

 

 

 

(249,975

)

Long-term debt, less current maturities

 

 

 

 

 

$

1,229,372

 

 

 

 

 

 

$

1,225,962

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Company has twelve months to reinvest the cash proceeds received from the sale of the Mobility business unit. If the proceeds are not reinvested, the Company is required to use the proceeds to prepay the Term Loan. The Company plans to use the cash proceeds for debt repayment and reinvestment. Permitted investments, as defined in the Term Loan Credit Agreement, include extensions of trade credit in the ordinary course of business, investments in cash and cash equivalents, permitted acquisitions, investments in assets useful in the business of the Company and its restricted subsidiaries, investments in joint ventures and unrestricted subsidiaries among others.

 

Debt Covenants

Borrowings under the Term Loan and Senior Notes are subject to certain affirmative and negative covenants, including limitations on indebtedness, corporate transactions, investments and dispositions, and share payments.

Under the occurrence of certain events, the U.S. Asset-Based Lending Credit Agreement (U.S. ABL) and Asia Asset-Based Lending Credit Agreement (Asia ABL) (collectively, the ABL Revolving Loans), are subject to various financial and operational covenants, including maintaining minimum fixed charge coverage ratios.

Debt Issuance and Debt Discount

As of March 30, 2020 and December 30, 2019, remaining unamortized debt discount and debt issuance costs for the Term Loan Facility, Senior Notes and Convertible Senior Notes are as follows:

 

 

 

As of March 30, 2020

 

 

As of December 30, 2019

 

 

Debt

Issuance Costs

 

 

Debt

Discount

 

 

Effective

Interest Rate

 

 

Debt

Issuance Costs

 

 

Debt

Discount

 

 

Effective

Interest Rate

 

 

 

 

(In thousands, except interest rates)

Term Loan due September 2024

 

$

6,340

 

 

$

1,918

 

 

 

4.66

 

%

$

6,663

 

 

$

2,016

 

 

 

4.66

 

%

Senior Notes due October 2025

 

 

5,121

 

 

 

 

 

5.92

 

 

 

5,316

 

 

 

 

 

5.92

 

 

Convertible Senior Notes

 

 

741

 

 

 

7,387

 

 

 

6.48

 

 

 

995

 

 

 

9,927

 

 

 

6.48

 

 

 

 

$

12,202

 

 

$

9,305

 

 

 

 

 

 

$

12,974

 

 

$

11,943

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The above debt discount and debt issuance costs are recorded as a reduction of the debt and are amortized into interest expense using an effective interest rate over the duration of the debt.

Remaining unamortized debt issuance costs for the ABL Revolving Loans of $2,369 and $2,511 as of March 30, 2020 and December 30, 2019, respectively, are included in other non-current assets and are amortized to interest expense over the duration of the ABL Revolving Loans using the straight-line method of amortization.

As of March 30, 2020, the remaining weighted average amortization period for all unamortized debt discount and debt issuance costs was 3.4 years.