Debt, Finance Lease Obligations and Other Financing

9 Months Ended

Jul. 02, 2022

Debt and Lease Obligation [Abstract]

Debt, Finance Lease Obligations and Other Financing

Debt, Finance Lease Obligations and Other Financing

Debt and finance lease obligations as of July 2, 2022 and October 2, 2021, consisted of the following (in thousands):

	July 2, 2022		October 2, 2021
4.05% Senior Notes, due June 15, 2025	$	100,000	$	100,000
4.22% Senior Notes, due June 15, 2028	50,000		50,000
Borrowings under the Credit Facility	240,000		55,000
Finance lease and other financing obligations	46,328		49,279
Unamortized deferred financing fees	(1,609)		(933)
Total obligations	434,719		253,346
Less: current portion	(250,012)		(66,313)
Long-term debt and finance lease obligations, net of current portion	$	184,707	$	187,033

On June 15, 2018, the Company entered into a Note Purchase Agreement (the “2018 NPA”) pursuant to which it issued an aggregate of $150.0 million in principal amount of unsecured senior notes, consisting of $100.0 million in principal amount of 4.05% Series A Senior Notes, due on June 15, 2025, and $50.0 million in principal amount of 4.22% Series B Senior Notes, due on June 15, 2028 (collectively, the “2018 Notes”), in a private placement. The 2018 NPA includes customary operational and financial covenants with which the Company is required to comply, including, among others, maintenance of certain financial ratios such as a total leverage ratio and a minimum interest coverage ratio. The 2018 Notes may be prepaid in whole or in part at any time, subject to payment of a make-whole amount; interest on the 2018 Notes is payable semiannually. As of July 2, 2022, the Company was in compliance with the covenants under the 2018 NPA.

On June 9, 2022, the Company refinanced its then-existing senior unsecured revolving credit facility (as amended by that certain Amendment No. 1 to Credit Agreement dated April 29, 2020, the "Prior Credit Facility") by entering into a new 5-year revolving credit facility (collectively with the Prior Credit Facility, referred to as the "Credit Facility"), which expanded the maximum commitment from $350.0 million to $500.0 million and extended the maturity from May 15, 2024 to June 9, 2027. The maximum commitment under the Credit Facility may be further increased to $750.0 million, generally by mutual agreement of the Company and the lenders, subject to certain customary conditions. During the nine months ended July 2, 2022, the highest daily borrowing was $327.0 million; the average daily borrowings were $204.9 million. The Company borrowed $524.0 million and repaid $339.0 million of revolving borrowings under the Credit Facility during the nine months ended July 2, 2022. As of July 2, 2022, the Company was in compliance with all financial covenants relating to the Credit Facility, which are generally consistent with those in the 2018 NPA discussed above. The Company is required to pay a commitment fee on the daily unused Credit Facility based on the Company's leverage ratio; the fee was 0.125% as of July 2, 2022.

The fair value of the Company’s debt, excluding finance lease and other financing obligations, was $383.5 million and $217.1 million as of July 2, 2022 and October 2, 2021, respectively. The carrying value of the Company's debt, excluding finance lease and other financing obligations, was $390.0 million and $205.0 million as of July 2, 2022 and October 2, 2021, respectively. If measured at fair value in the financial statements, the Company's debt would be classified as Level 2 in the fair value hierarchy. Refer to Note 4, "Derivatives and Fair Value Measurements," for further information regarding the Company's fair value calculations and classifications.