Debt Obligations

Our current indebtedness included senior notes and the repurchase option related to a sale-leaseback of a portion of our New York headquarters. Our total debt and capital lease obligations consisted of the following:



(In thousands, except percentages)	December 27, 2015		December 28, 2014
Total debt and capital lease obligations:
Senior notes due in 2015
Principal amount	$	—	$	223,669
Less unamortized discount based on imputed interest rate of 5.0%	—		7
Total senior notes due in 2015	—		223,662
Senior notes due in 2016
Principal amount	189,170		189,170
Less unamortized discount based on imputed interest rate of 6.625%	793		1,566
Total senior notes due in 2016	188,377		187,604
Option to repurchase ownership interest in headquarters building in 2019
Principal amount	250,000		250,000
Less unamortized discount based on imputed interest rate of 13.0%	13,905		17,882
Total option to repurchase ownership interest in headquarters building in 2019	236,095		232,118
Capital lease obligations	6,756		6,736
Total debt and capital lease obligations	431,228		650,120
Less current portion	188,377		223,662
Total long-term debt and capital lease obligations	$	242,851	$	426,458

See Note 8 for information regarding the fair value of our long-term debt.

The aggregate face amount of maturities of debt over the next five years and thereafter is as follows:



(In thousands)	Amount
2016	$	189,170
2017	—
2018	—
2019	250,000
2020	—
Thereafter	—
Total face amount of maturities	439,170
Less: Unamortized debt costs and discount	(14,698		)
Carrying value of debt (excludes capital leases)	$	424,472

Interest expense, net, as shown in the accompanying Consolidated Statements of Operations was as follows:



(In thousands)	December 27, 2015			December 28, 2014			December 29, 2013
Interest expense	$	41,973		$	51,877		$	52,913
Premium on debt repurchases	—			2,538			2,127
Amortization of debt costs and discount on debt	4,756			4,651			4,548
Capitalized interest	(338		)	(152		)	—
Interest income	(7,341		)	(5,184		)	(1,515		)
Total interest expense, net	$	39,050		$	53,730		$	58,073

5.0% Notes

In 2005, we issued $250.0 million aggregate principal amount of 5.0% senior unsecured notes due March 15, 2015 (“5.0% Notes”). In March 2015, we repaid, at maturity, the remaining principal amount of the 5.0% Notes. During 2014, we repurchased $20.4 million principal amount of the 5.0% Notes and recorded a $0.3 million pre-tax charge in connection with the repurchase. This charge is included in “Interest expense, net” in our Consolidated Statements of Operations.

6.625% Notes

In November 2010, we issued $225.0 million aggregate principal amount of 6.625% senior unsecured notes due December 15, 2016 (“6.625% Notes”). During 2014, we repurchased $18.4 million principal amount of the 6.625% Notes and recorded a $2.2 million pre-tax charge in connection with the repurchases. During 2013, we repurchased $17.4 million principal amount of the 6.625% Notes and recorded a $2.1 million pre-tax charge in connection with the repurchases.

We have the option to redeem all or a portion of the 6.625% Notes, at any time, at a price equal to 100% of the principal amount of the notes redeemed plus accrued and unpaid interest to the redemption date plus a “make-whole” premium. The 6.625% Notes are not otherwise callable.

The 6.625% Notes are subject to certain covenants that, among other things, limit (subject to customary exceptions) our ability and the ability of our subsidiaries to:


•	incur additional indebtedness and issue preferred stock;


•	pay dividends or make other equity distributions;


•	agree to any restrictions on the ability of our restricted subsidiaries to make payments to us;


•	create liens on certain assets to secure debt;


•	make certain investments;


•	merge or consolidate with other companies or transfer all or substantially all of our assets; and


•	engage in sale-leaseback transactions.

The Company intends to repay the 6.625% Notes in full at their maturity on December 15, 2016.

Sale-Leaseback Financing

In March 2009, we entered into an agreement to sell and simultaneously lease back a portion of our leasehold condominium interest in our Company’s headquarters building located at 620 Eighth Avenue in New York City (the “Condo Interest”). The sale price for the Condo Interest was $225.0 million. We have an option, exercisable in 2019, to repurchase the Condo Interest for $250.0 million. The lease term is 15 years, and we have three renewal options that could extend the term for an additional 20 years.

The transaction is accounted for as a financing transaction. As such, we have continued to depreciate the Condo Interest and account for the rental payments as interest expense. The difference between the purchase option price of $250.0 million and the net sale proceeds of approximately $211 million, or approximately $39 million, is being amortized over a 10-year period through interest expense. The effective interest rate on this transaction was approximately 13%.