Borrowings

The following table provides details of the Company's long-term debt (in thousands, except percentages):



					October 27, 2012				October 29, 2011
	Maturity	Stated Annual Interest Rate			Amount		Effective Interest Rate		Amount		Effective Interest Rate
Senior Secured Notes:
2018 Notes	2018		6.625	%	$	300,000	7.05	%	$	300,000	7.05	%
2020 Notes	2020		6.875	%	300,000		7.26	%	300,000		7.26	%
Senior Secured Credit Facility:
Term loan	2014	LIBOR+	2.25	%	—		—	%	190,000		4.41	%
Capital lease obligations	2015		5.80	%	4,916		5.80	%	6,782		5.80	%
Total long-term debt					604,916				796,782
Less:
Unamortized discount					3,736				7,339
Current portion of long-term debt					1,977				40,539
Total long-term debt, net of current portion					$	599,203			$	748,904

Senior Secured Notes

In January 2010, the Company issued $300 million in aggregate principal amount of senior secured notes due 2018 (the “2018 Notes”) and $300 million in aggregate principal amount of senior secured notes due 2020 (the “2020 Notes" and together with the 2018 Notes, the “senior secured notes”). The senior secured notes bear interest payable semi-annually on January 15 and July 15 of each year. No payments were made towards the principal of the senior secured notes during the fiscal years ended October 27, 2012 and October 29, 2011.

As of October 27, 2012 and October 29, 2011, the fair value of the Company’s senior secured notes was approximately $638 million and $626 million, respectively, estimated based on broker trading prices.

On or after January 2013, the Company may redeem all or a part of the 2018 Notes at the redemption prices set forth in the Indenture governing the 2018 Notes (the 2018 Indenture), plus accrued and unpaid interest and special interest, if any, to the applicable redemption date. In addition, at any time prior to January 2013, the Company may, on one or more than one occasion, redeem some or all of the 2018 Notes at any time at a redemption price equal to 100% of the principal amount of the 2018 Notes redeemed, plus a “make-whole” premium determined as of, and accrued and unpaid interest and special interest, if any, to, the applicable redemption date. On or after January 2015, the Company may redeem all or a part of the 2020 Notes at the redemption prices set forth in the Indenture governing the 2020 Notes (the 2020 Indenture), plus accrued and unpaid interest and special interest, if any, to the applicable redemption date. In addition, at any time prior to January 2015, the Company may, on one or more than one occasion, redeem some or all of the 2020 Notes at any time at a redemption price equal to 100% of the principal amount of the 2020 Notes redeemed, plus a “make-whole” premium determined as of, and accrued and unpaid interest and special interest, if any, to the applicable redemption date. At any time prior to January 2013, the Company may also redeem up to 35% of the aggregate principal amount of the 2018 Notes and 2020 Notes, using the proceeds of certain qualified equity offerings, at the redemption prices set forth in the 2018 Indenture and the 2020 Indenture, respectively.

If the Company experiences specified change of control triggering events, it must offer to repurchase the senior secured notes at a repurchase price equal to 101% of the principal amount of the senior secured notes repurchased, plus accrued and unpaid interest and special interest, if any, to the applicable repurchase date. If the Company or its subsidiaries sell assets under certain specified circumstances, the Company must offer to repurchase the senior secured notes at a repurchase price equal to 100% of the principal amount of the senior secured notes repurchased, plus accrued and unpaid interest and special interest, if any, to the applicable repurchase date.

Each of the Indentures contains covenants that, among other things, restrict the ability of the Company and its restricted subsidiaries to:


•	pay dividends, make investments or make other restricted payments;


•	incur additional indebtedness;


•	sell assets;


•	enter into transactions with affiliates;


•	incur liens;


•	permit consensual encumbrances or restrictions on the Company’s restricted subsidiaries’ ability to pay dividends or make certain other payments to the Company;


•	consolidate, merge, sell or otherwise dispose of all or substantially all of the Company’s or its restricted subsidiaries’ assets; and


•	designate subsidiaries as unrestricted.

These covenants are subject to a number of other limitations and exceptions set forth in the Indentures. Each of the Indentures also includes customary events of default, including cross-defaults to other debt of the Company and its subsidiaries. The Company was in compliance with all applicable covenants of the Indentures as of October 27, 2012 and October 29, 2011.

The Company’s obligations under the senior secured notes are guaranteed by certain of the Company’s domestic subsidiaries, see Note 18, “Guarantor and Non-Guarantor Subsidiaries.”

Senior Secured Credit Facility

In October 2008, the Company entered into a credit facility agreement for (i) a five-year $1,100 million term loan facility and (ii) a five-year $125 million revolving credit facility, which includes a $25 million swing line loan sub-facility and a $25 million letter of credit sub-facility (“Senior Secured Credit Facility”).

The credit facility agreement was subsequently amended in January 2010 and June 2011 to, among other things, (i) increase flexibility under certain financial and other covenants, (ii) permit the Company to issue additional senior indebtedness and additional subordinated indebtedness, (iii) permit the Company to sell its accounts receivable and lease receivables, (iv) reduce interest rates on the term loan facility and extend the maturity date of the term loan facility to October 31, 2014, and (v) remove certain restrictions on the repurchase of the Company’s shares, provided the consolidated senior secured leverage ratio is under 2.00:1.00. In accordance with the applicable accounting guidance for debt modification and extinguishment, the Company expensed $25.5 million of debt issuance costs and original issue discount relating to the portion of the term loan that was extinguished by the June 2011 amendment. This expense was reported within “Interest expense” in the Consolidated Statements of Operations for the fiscal year ended October 29, 2011.

During the fiscal year ended October 27, 2012, the Company paid $190.0 million to pay in full the term loan facility, $170.7 million of which were voluntary prepayments.

The Company believes that the carrying value of its Senior Secured Credit Facility approximated its fair value as the interest rate was based on a floating market rate.

The Company may draw additional proceeds from the revolving credit facility in the future for ongoing working capital and other general corporate purposes. There were no principal amounts outstanding under the revolving credit facility and the full $125 million was available for future borrowing under the revolving credit facility as of October 27, 2012 and October 29, 2011.

The credit agreement contains financial covenants that require the Company to maintain a minimum consolidated fixed charge coverage ratio, a maximum consolidated leverage ratio and a maximum consolidated senior secured leverage ratio. The credit agreement also includes customary non-financial covenants (similar in nature to those under the senior secured notes) and customary events of default, including cross-defaults to the Company’s material indebtedness and change of control. The Company was in compliance with all applicable Senior Secured Credit Facility's covenants as of October 27, 2012 and October 29, 2011.

Debt Maturities

As of October 27, 2012, our aggregate debt maturities based on outstanding principal were as follows (in thousands):



Fiscal Year	Principal Balances
2013	$	1,977
2014	2,095
2015	844
2016	—
2017	—
Thereafter	600,000
Total	$	604,916