Long-Term Debt

6 Months Ended

Jun. 28, 2020

Long-term debt consisted of the following (in millions):


	June 28, 2020		December 29, 2019
Term Loan Facility	$	774.0	$	778.0
Notes	500.0		500.0


Total debt	1,274.0		1,278.0
Unamortized debt issuance costs	(24.0)		(23.3)
Current maturities of long-term debt	—		—
Long-term debt	$	1,250.0	$	1,254.7

Credit Facility

On June 28, 2019, the Company entered into a credit agreement (the “Credit Agreement”), which provides for, among other things: (i) a seven-year senior secured term loan facility in an aggregate principal amount of $800 million (the “Term Loan Facility”) and (ii) a five-year revolving credit facility in an aggregate principal amount of $225 million (the “Revolving Credit Facility,” and together with the Term Loan Facility, the “Credit Facility”). On May 1, 2020, the Company entered into an amendment to its Credit Agreement to increase the aggregate principal amount able to be borrowed under the Revolving Credit Facility by $136.0 million to $361.0 million. The Revolving Credit Facility includes a $50 million sub-limit for issuance of letters of credit and a $50 million sublimit for swing line loans, which can be borrowed on same-day notice.

The Term Loan Facility matures on June 28, 2026. During the six months ended June 28, 2020, the Company made an optional principal pre-payment of $4.0 million on the Term Loan Facility. As of June 28, 2020 and December 29, 2019, the interest rate per annum for the Term Loan Facility was 2.4% and 4.0%, respectively.

The Revolving Credit Facility matures on June 28, 2024. As of June 28, 2020, no amounts were outstanding under the Revolving Credit Facility.

The Credit Agreement contains affirmative and negative covenants that are usual and customary for a senior secured credit agreement. The negative covenants include, among other things, limitations on asset sales, mergers and acquisitions, indebtedness, liens, dividends, investments and transactions with the Company's affiliates. The Credit Agreement also requires the Company to maintain a maximum Consolidated Senior Secured Net Leverage Ratio (as defined in the Credit Agreement) not to exceed 3.50 to 1.00 as of each test date on which any Revolving Loans (as defined in the Credit Agreement) are outstanding. The Company was in compliance with the covenants in the Credit Agreement at June 28, 2020.

Notes

On June 6, 2019, the Company issued $500.0 million aggregate principal amount of 5.500% Senior Notes due 2027 (the “Notes”). The Notes mature on June 15, 2027. Interest on the Notes is due on June 15 and December 15 of each year and accrues at a rate of 5.500% per annum.

The Notes contain covenants which, among other things, limit the Company and its restricted subsidiaries’ ability to pay dividends on or make other distributions in respect of equity interests or make other restricted payments, make certain investments, incur liens on certain assets to secure debt, sell certain assets, consummate certain mergers or consolidations or sell all or substantially all assets, or designate subsidiaries as unrestricted. The Company was in compliance with the covenants at June 28, 2020.

Other

At December 30, 2018, the Company had intercompany debt with KAR of $456.6 million. This debt was eliminated in the Separation. This debt was comprised of three promissory notes, payable on demand, with a weighted average interest rate of 8.27%.

At June 28, 2020, the Company had outstanding letters of credit in the aggregate amount of $6.5 million, of which $6.1 million reduce the amount available for borrowings under its Revolving Credit Facility. At December 29, 2019, the Company had outstanding letters of credit in the aggregate amount of $7.0 million, all of which reduce the amount available for borrowings under its Revolving Credit Facility.

Fair Value of Debt

As of June 28, 2020, the estimated fair value of the Company's long-term debt was $1,264.4 million. The estimates of fair value were based on broker-dealer quotes for the Company's debt as of June 28, 2020. The estimates presented on long-term financial instruments are not necessarily indicative of the amounts that would be realized in a current market exchange.