Long-Term Debt

3 Months Ended

Apr. 04, 2023

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term DebtOn May 9, 2018, the Company entered into a credit facility with U.S. Bank National Association (the “2018 Credit Facility”). The 2018 Credit Facility was subsequently amended on November 20, 2019 and then again on June 16, 2020, (as amended, the “Second Amended Credit Facility”).

On July 27, 2022, the Company amended and restated its Second Amended Credit Facility by entering into the Third Amendment to the Credit Agreement (as amended and restated, the “Third Amended Credit Facility”) which matures on July 27, 2027. Among other things, the Third Amended Credit Facility: (i) increased the credit facility from $100.0 million to $125.0 million; (ii) eliminated the term loan and principal amortization components of the credit facility; (iii) removed the Company’s capital expenditure covenant; (iv) enhanced flexibility for certain covenants and restrictions; and (v) lowered the spread of the Company’s cost of borrowing and transitioned from the London Interbank Offered Rate (LIBOR) to the Secured Overnight Financing Rate (“SOFR”) plus a margin of 1.50% to 2.50% per annum, based upon the consolidated total lease-adjusted leverage ratio.

As of April 4, 2023, the Company had $52.8 million of indebtedness (excluding $1.6 million of unamortized debt issuance costs) and $3.0 million of letters of credit outstanding under the Third Amended Credit Facility. As of April 4, 2023, the Company had cash on hand of $2.1 million.

The Company’s revolver, which had a balance of $47.4 million as of April 4, 2023, bore interest at rates between 6.63% and 7.2%. The Company’s swingline, which had a balance of $5.4 million as of April 4, 2023, bore interest at rates between 8.75% and 9.25%.

The Company also maintains outstanding letters of credit to secure obligations under its workers’ compensation program and certain lease obligations. The Company was in compliance with all of its debt covenants as of April 4, 2023.