Debt (Tables)

3 Months Ended

Mar. 31, 2017



11.	Debt

Debt was comprised of the following at the end of each period:



	March 31, 2017				December 30, 2016
	Principal		Unamortized Discount and Debt Issuance Costs		Principal		Unamortized Discount and Debt Issuance Costs
Current maturities of long-term debt:
Variable-rate receivable securitization	$	225.0	$	0.2	$	250.0	$	0.3
Term loan due March 2021	—		—		20.0		0.3
4.00% term loan due February 2022	1.0		—		1.0		—
Term loan due September 2024	18.7		0.3		—		—
Capital lease obligation and vendor financing agreements	0.7		—		0.8		—
Total current debt	245.4		0.5		271.8		0.6
Long-term debt:
3.50% notes due April 2018	300.0		0.7		300.0		0.9
4.875% notes due April 2020	700.0		7.6		700.0		8.2
Term loan due March 2021	—		—		1,928.5		33.4
4.00% term loan due February 2022	5.4		—		5.5		—
9.50% debentures due May 2022	10.4		—		10.4		—
5.75% notes due August 2022	884.0		11.0		884.0		11.6
8.00% debentures due March 2023	4.4		—		4.4		—
4.75% notes due April 2023	600.0		5.9		600.0		6.1
5.625% notes due October 2023	738.0		11.0		738.0		11.4
Term loan due September 2024	1,846.3		30.5		—		—
5.50% notes due April 2025	695.0		9.9		695.0		10.2
Revolving credit facility	—		7.0		100.0		3.2
Total long-term debt	5,783.5		83.6		5,965.8		85.0
Total debt	$	6,028.9	$	84.1	$	6,237.6	$	85.6

The Company's debt instruments are further described within the notes to the financial statements included within the Company's Annual Report filed on Form 10-K for the fiscal year ended September 30, 2016.

On February 28, 2017, Mallinckrodt International Finance, S.A. ("MIFSA") and Mallinckrodt CB LLC ("MCB") refinanced the March 2014 and August 2014 term loans, both of which were due in March 2021 ("the Existing Term Loans"). The refinanced term loans have an aggregate principal amount of $1,865.0 million are due in September 2024 and bear interest at LIBOR plus 2.75% ("the 2017 Term Loan"). The 2017 Term Loan requires quarterly principal amortization payments in an amount equal to 0.25% of the original principal balance of the 2017 Term Loan payable on the last day of each calendar quarter, which will commence on June 30, 2017, with the remaining balance due on September 24, 2024. The Company accounted for the term loan financing as a debt modification.

In conjunction with the term loan refinancing, MIFSA and MCB replaced the existing revolving credit facility of $500.0 million due in March 2019 with a $900.0 million facility that matures on February 28, 2022 ("the 2017 Revolving Credit Facility"). The 2017 Revolving Credit Facility bears interest at LIBOR plus 2.25%. The 2017 Revolving Credit Facility reduced the letter of credit provision from $150.0 million to $50.0 million. Unused commitments under the 2017 Revolving Credit Facility are subject to an annual commitment fee of 0.275%. Fees applied to outstanding letters of credit is based on the interest rate applied to borrowings. The 2017 Revolving Credit Facility added certain wholly-owned subsidiaries of the Company as borrowers, in addition to Mallinckrodt plc, MIFSA and MCB.

The 2017 Term Loan and 2017 Revolving Credit Facility (collectively "the 2017 Facilities") are fully and unconditionally guaranteed by Mallinckrodt plc, certain of its direct or indirect wholly-owned U.S. subsidiaries and each of its direct or indirect wholly-owned subsidiaries that owns directly or indirectly any such wholly-owned U.S. subsidiaries and certain of its other subsidiaries (collectively, "the Guarantors"). The 2017 Facilities are secured by a security interest in certain assets of MIFSA, MCB and the Guarantors. The 2017 Facilities contain customary affirmative and negative covenants, which include, among other things, restrictions on the Company's ability to declare or pay dividends, create liens, incur additional indebtedness, enter into sale and lease-back transactions, make investments, dispose of assets and merge or consolidate with any other person.

As a result of the 2017 Facilities financing transaction and the write-off of certain deferred financing costs associated with an $83.5 million payment on the Existing Term Loans, the Company recorded a $10.0 million charge included within the other expense line in the unaudited condensed consolidated statement of income.

As of March 31, 2017, the applicable interest rate on outstanding borrowings under the Company's revolving credit facility was approximately 3.40%, and there were no outstanding borrowings. As of March 31, 2017, the applicable interest rate on outstanding borrowings under the variable-rate receivable securitization was 1.78%, and outstanding borrowings totaled $225.0 million. At March 31, 2017, the applicable interest rate for the term loan due September 2024 was 3.90%, and outstanding borrowings totaled $1,865.0 million.

As of March 31, 2017, the Company continues to be in full compliance with the provisions and covenants associated with its debt agreements.

Schedule of Debt including Capital Lease Obligation

Debt was comprised of the following at the end of each period:



	March 31, 2017				December 30, 2016
	Principal		Unamortized Discount and Debt Issuance Costs		Principal		Unamortized Discount and Debt Issuance Costs
Current maturities of long-term debt:
Variable-rate receivable securitization	$	225.0	$	0.2	$	250.0	$	0.3
Term loan due March 2021	—		—		20.0		0.3
4.00% term loan due February 2022	1.0		—		1.0		—
Term loan due September 2024	18.7		0.3		—		—
Capital lease obligation and vendor financing agreements	0.7		—		0.8		—
Total current debt	245.4		0.5		271.8		0.6
Long-term debt:
3.50% notes due April 2018	300.0		0.7		300.0		0.9
4.875% notes due April 2020	700.0		7.6		700.0		8.2
Term loan due March 2021	—		—		1,928.5		33.4
4.00% term loan due February 2022	5.4		—		5.5		—
9.50% debentures due May 2022	10.4		—		10.4		—
5.75% notes due August 2022	884.0		11.0		884.0		11.6
8.00% debentures due March 2023	4.4		—		4.4		—
4.75% notes due April 2023	600.0		5.9		600.0		6.1
5.625% notes due October 2023	738.0		11.0		738.0		11.4
Term loan due September 2024	1,846.3		30.5		—		—
5.50% notes due April 2025	695.0		9.9		695.0		10.2
Revolving credit facility	—		7.0		100.0		3.2
Total long-term debt	5,783.5		83.6		5,965.8		85.0
Total debt	$	6,028.9	$	84.1	$	6,237.6	$	85.6