Long-Term Obligations

3 Months Ended

Apr. 02, 2022

Debt Disclosure [Abstract]

Long-Term Obligations

4. LONG-TERM OBLIGATIONS

Long-term obligations consisted of the following as of April 2, 2022 and January 1, 2022, respectively (dollar amounts in thousands):

Instrument	Stated Maturity Date	Contractual Interest Rate	Interest Rate as of April 2, 2022	April 2, 2022			January 1, 2022
2021 Extended Term Loan (1)	07/2028	L + 3.75%	4.25%	$	855,700		$	857,850
Term Loan - Second Lien Term Loan (1)	12/2029	L + 7.00%	7.50%		415,000			415,000
Revolving Credit Facility (1)	04/2026	L + 3.75%	4.25%		-			-
Total principal amount of long-term obligations					1,270,700			1,272,850
Less: unamortized debt issuance costs					(36,672	)		(37,733	)
Total amount of long-term obligations, net of unamortized debt issuance costs					1,234,028			1,235,117
Less: current portion of long-term obligations					(8,600	)		(8,600	)
Total amount of long-term obligations, net of unamortized debt issuance costs, less current portion				$	1,225,428		$	1,226,517
(1) L = Greater of 0.50% or one-month LIBOR

The 2021 Extended Term Loan and any Delayed Draw Term Loans bear interest, at the Company’s election, at a variable interest rate based on either LIBOR (subject to a minimum of 0.50%), or ABR (subject to a minimum of 2.00%) for the interest period relevant to such borrowing, plus an applicable margin of 3.75% for loans accruing interest based on LIBOR and an applicable margin of 2.75% for loans accruing interest based on ABR. As of April 2, 2022, the $860.0 million principal amount of the 2021 Extended Term Loan accrued interest at a rate of 4.25%.

The Second Lien Term Loan bears interest at a rate per annum equal to, at the Company’s option, either (1) an applicable margin (equal to 6.00%) plus a base rate determined by reference to the highest of (a) 0.50% per annum plus the Federal Funds Effective Rate, (b) the Prime Rate and (c) the LIBOR rate determined by reference to the cost of funds for U.S. dollar deposits for an interest period of one month adjusted for certain additional costs, plus 1.00%; or (2) an applicable margin (equal to 7.00%) plus LIBOR determined by reference to the cost of funds for U.S. dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs; provided that such rate is not lower than a floor of 0.50%. As of April 2, 2022, the $415.0 million principal amount of the Second Lien Term Loan accrued interest at a rate of 7.50%.

Debt issuance costs related to the term loans are recorded as a direct deduction from the carrying amount of the debt. The balance for debt issuance costs related to the term loans as of April 2, 2022 and January 1, 2022 was $36.7 million and $37.7 million, respectively. Debt issuance costs related to the Revolving Credit Facility and Delayed Draw Term Loans are recorded within other long-term assets. The balance for debt issuance costs related to the Revolving Credit Facility and Delayed Draw Term Loans as of April 2, 2022 and January 1, 2022 was $2.6 million and $3.2 million, respectively. The Company recognized interest expense related to the amortization of debt issuance costs of $1.7 million and $2.1 million during the three-month periods ended April 2, 2022 and April 3, 2021, respectively.

Issued letters of credit as of April 2, 2022 and January 1, 2022 were $17.6 million and $17.6 million, respectively. There were no swingline loans outstanding as of April 2, 2022 or January 1, 2022. Borrowing capacity under the Company's Revolving Credit Facility was $182.4 million as of April 2, 2022 and $182.4 million as of January 1, 2022.

The fair value of the long-term obligations was $1,270.7 million at April 2, 2022. Due to the variable rate nature of the 2021 Extended Term Loan and Second Lien Term Loan, the Company believes that the carrying amount approximates fair value at April 2, 2022.

The Company was in compliance with all financial covenants and restrictions under the foregoing instruments at April 2, 2022.