Debt

9 Months Ended

Jul. 04, 2020

4. Debt

On May 7, 2020, the Company entered into a Second Amendment which amended the Credit Agreement, dated as of December 12, 2016 (the “Credit Agreement”, as amended by that certain First Amendment to Credit Agreement, dated as of September 13, 2018 (the “First Amendment”), and as further amended by the Second Amendment, the “Amended Credit Agreement”). The Second Amendment provided

for an aggregate lender commitment of $41.9 million of additional revolving commitments bringing the total revolving commitments to $141.9 million. The revolving commitments under the Amended Credit Agreement mature on September 13, 2023, which is the fifth anniversary of the effective date of the First Amendment. The interest rate pricing grid remained unchanged, but the LIBOR floor was amended from 0% to 0.75%. We incurred $0.9 million in fees related to the amendment. The fees were capitalized to other assets on the Consolidated Balance Sheets and are amortized on a straight-line basis to interest expense until maturity of the agreement.

Term debt consisted of the following at the dates indicated:



(in thousands of dollars)	July 4, 2020		September 28, 2019
2023 term loan, net of deferred financing costs of $2,458 and $3,124, respectively	$	176,367	$	183,126
Less: current portion of long-term debt	9,900		9,900
Long-term debt, net of current portion	$	166,467	$	173,226

Term loans are recognized on the Condensed Consolidated Balance Sheets at the unpaid principal balance, and are not subject to fair value measurement; however, given the variable rates on the loans, the Company estimates that the unpaid principal balance approximates fair value. If measured at fair value in the financial statements, the term loans would be classified as Level 2 in the fair value hierarchy. At July 4, 2020 and September 28, 2019, $178.8 million and $186.3 million, respectively, were outstanding on the term loans.

At July 4, 2020 and September 28, 2019, the stated interest rates on the term loans were 2.8% and 4.4%, respectively. At July 4, 2020 and September 28, 2019, the weighted-average annual effective interest rates for the term loans were 4.1% and 5.0%, respectively, which includes amortization of the deferred financing costs.

At July 4, 2020, $45.0 million in borrowings were outstanding on the Revolving Credit Facility and $6.9 million of Letters of Credit were outstanding; therefore, the Company would have been able to borrow $90.0 million on the revolving line of credit.

Interest expense on all indebtedness was $2.4 million and $3.4 million for the three months ended July 4, 2020 and June 29, 2019, respectively, and $10.0 million and $10.3 million for the nine months ended July 4, 2020 and June 29, 2019, respectively.

The schedule of remaining principal payments through maturity for total debt is as follows:



(in thousands of dollars)
Year	Principal Payments
2020	$	2,475
2021	9,900
2022	14,850
2023	196,600
Total remaining principal payments	$	223,825