Debt (Tables)

6 Months Ended

Jun. 29, 2013

Debt Disclosure [Abstract]

Summary of debt outstanding

Cadence’s outstanding debt as of June 29, 2013 and December 29, 2012 was as follows:

	June 29, 2013							December 29, 2012
	(In thousands)
	Principal		Unamortized Discount			Carrying Value		Principal		Unamortized Discount			Carrying Value
2015 Notes	$	350,000	$	(33,320	)	$	316,680	$	350,000	$	(41,181	)	$	308,819
2013 Notes	144,461		(3,140		)	141,321		144,461		(6,447		)	138,014
2023 Notes	178		—			178		178		—			178
Revolving credit facility	100,000		—			100,000		—		—			—
Total outstanding debt	$	594,639	$	(36,460	)	$	558,179	$	494,639	$	(47,628	)	$	447,011

Summary of key terms of 2015 notes and 2013 notes

A summary of key terms of the 2015 Notes is as follows:

	2015 Notes
	(In thousands, except percentages and per share amounts)
Outstanding principal maturity value – at June 29, 2013	$350,000
Contractual interest rate	2.625%
Contractual maturity date	June 1, 2015
Initial conversion rate	132.5205 shares of common stock per $1,000 principal amount of notes, which is equivalent to a conversion price of approximately $7.55 per share of Cadence common stock.
Conversion feature (in addition to principal amount payable in cash)	Cash to the extent Cadence’s stock price exceeds approximately $7.55 per share, calculated based on the applicable conversion rate multiplied by the volume weighted average price of Cadence common stock over a specified period.
Early conversion conditions (or the Early Conversion Conditions)	• Closing stock price greater than $9.81 for at least 20 of the last 30 trading days in a fiscal quarter (convertible only for subsequent quarter); • Specified corporate transactions; or • Note trading price falls below a calculated minimum.
Conversion immediately preceding maturity	From March 1, 2015 until the second trading day immediately preceding the maturity date, holders may convert their 2015 Notes at any time into cash as described above under “Conversion feature.”
Redemption at Cadence’s option prior to maturity	None.
Fundamental change put right	Upon certain fundamental corporate changes prior to maturity, the 2015 Note holders could require Cadence to repurchase their notes for cash equal to the principal amount of the notes plus accrued interest.
Make-whole premium	Upon certain fundamental changes prior to maturity, if Cadence’s stock price were between $6.16 and $40.00 per share at that time, the 2015 Note holders would be entitled to an increase to the conversion rate. This is referred to as a “make-whole premium.”
Financial covenants	None.

A summary of key terms of the 2013 Notes is as follows:

	2013 Notes
	(In thousands, except percentages and per share amounts)
Principal maturity value – at issuance	$250,000
Outstanding principal maturity value – at June 29, 2013	$144,461
Contractual interest rate	1.500%
Contractual maturity date	December 15, 2013
Equity component - included in common stock - at June 29, 2013 and December 29, 2012	$63,027
Initial conversion rate	47.2813 shares of common stock per $1,000 principal amount of notes, which is equivalent to a conversion price of approximately $21.15 per share of Cadence common stock.
Conversion feature (in addition to principal amount payable in cash)	Shares to the extent Cadence’s stock price exceeds $21.15 per share, calculated based on the applicable conversion rate multiplied by the volume weighted average price of Cadence common stock over a specified period.
Early conversion conditions (or the Early Conversion Conditions)	•  Closing stock price greater than $27.50 for at least 20 of the last 30 trading days in a calendar quarter (convertible only for subsequent quarter); •  Specified corporate transactions; or •  Note trading price falls below calculated minimum.
Conversion immediately preceding maturity	From November 1, 2013, and until the trading day immediately preceding the maturity date, holders may convert their 2013 Notes at any time into cash and Cadence shares as described above under “Conversion feature.”
Redemption at Cadence’s option prior to maturity	None.
Fundamental change put right	Upon a fundamental change prior to maturity, the 2013 Note holders could require Cadence to repurchase their notes for cash equal to the principal amount of the notes plus accrued interest.
Make-whole premium	Upon certain fundamental changes, prior to maturity, if Cadence’s stock price were between $18.00 and $60.00 per share at that time, the 2013 Note holders would be entitled to an increase to the conversion rate. This is referred to as a “make-whole premium.”
Financial covenants	None.

Effective interest rate and components of interest expense of 2015 notes

The effective interest rate and components of interest expense of the 2015 Notes for the three and six months ended June 29, 2013 and June 30, 2012 were as follows:

	Three Months Ended						Six Months Ended
	June 29, 2013			June 30, 2012			June 29, 2013			June 30, 2012
	(In thousands, except percentages)
Effective interest rate	8.1		%	8.1		%	8.1		%	8.1		%
Contractual interest expense	$	2,289		$	2,289		$	4,578		$	4,578
Amortization of debt discount	$	3,951		$	3,638		$	7,861		$	7,231

Effective interest rate and components of interest expense of 2013 notes and 2011 notes

The effective interest rate and components of interest expense of the 2013 Notes for the three and six months ended June 29, 2013, and of the 2013 Notes and 2011 Notes for the three and six months ended June 30, 2012 were as follows:

	Three Months Ended						Six Months Ended
	June 29, 2013			June 30, 2012			June 29, 2013			June 30, 2012
	(In thousands, except percentages)
Effective interest rate	6.4		%	6.4		%	6.4		%	6.4		%
Contractual interest expense	$	540		$	540		$	1,080		$	1,080
Amortization of debt discount	$	1,657		$	1,547		$	3,307		$	3,086