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Long-Term Indebtedness

9 Months Ended

Oct. 02, 2022

3. Long-Term Indebtedness

Credit Facility

As of October 2, 2022, our credit facility consisted of a $350.0 million revolving credit loan facility (the “Second Amended and Restated Revolving Loan”) and a $479.0 million Tranche B Term Loan facility (the “Second Amended and Restated Term Loan B”) pursuant to the amended and restated credit facility that we entered into in 2019 (the “Second Amended and Restated Credit Facility”) and further amended in both April 2020 and August 2020. On May 18, 2022, we reduced and terminated the Series B replacement Revolving Commitments by $131.0 million, which reduced the Second Amended and Restated Revolving Loan capacity to $350.0 million from $481.0 million.

As of October 2, 2022, our available borrowing capacity under our Second Amended and Restated Revolving Loan was $219.0 million after reducing the facility by $110.0 million borrowings outstanding and $21.0 million of outstanding letters of credit. As of January 2, 2022 and October 3, 2021, no advances under the Second Amended and Restated Revolving Loan were outstanding (excluding amounts reserved for letters of credit in the amount of $20.2 million). Interest on the Second Amended and Restated Revolving Loan accrues at an annual rate of LIBOR plus an applicable margin with an unused commitment fee based on our senior secured leverage ratio. As of October 2, 2022, the Second Amended and Restated Revolving loan had an interest rate of 5.78%. As of October 2, 2022, the Second Amended and Restated Revolving Loan unused commitment fee was 0.625%. The Second Amended and Restated Revolving Loan matures on April 17, 2024.

As of October 2, 2022, January 2, 2022 and October 3, 2021, $479.0 million was outstanding under the Second Amended and Restated Term Loan B. Interest on the Second Amended and Restated Term Loan B accrues at an annual rate of LIBOR plus 1.75%. In June 2019, we entered into three separate interest rate swap agreements with a notional amount of $300.0 million (the “June 2019 Swap Agreements”) and, in August 2019, we entered into two separate interest rate swap agreements with a notional amount of $400.0 million (the “August 2019 Swap Agreements”). These swaps were entered into to mitigate the risk of an increase in the LIBOR interest rate on the Second Amended and

Restated Term Loan B by exchanging the floating LIBOR rate for a negotiated fixed rate. On March 24, 2022, we terminated the August 2019 Swap Agreements. The June 2019 Swap Agreements expire in June 2023. The Second Amended and Restated Term Loan B now consists of only floating rate debt. As of October 2, 2022, the applicable interest rate on the Second Amended and Restated Term Loan B was 3.23%. The Second Amended and Restated Term Loan B matures on April 17, 2026.

2024 Notes, 2025 Notes and 2027 Notes

In June 2016, Holdings issued $300.0 million of 4.875% senior unsecured notes due 2024 and, in April 2017, issued an additional $700.0 million of senior unsecured notes due 2024 (together, the “2024 Notes”). In April 2017, Holdings issued $500.0 million of 5.50% senior notes due 2027 (the "2027 Notes"). In April 2020, SFTP issued $725.0 million of 7.00% senior secured notes due 2025 (the “2025 Notes”).

On July 1, 2022, Holdings prepaid $360.0 million of the 2025 Notes at a premium of 103.5%. The transaction reduced the outstanding amount of the 2025 Notes to $365.0 million. We incurred a $17.5 million loss on debt extinguishment containing $12.6 million for the premium paid above par and $5.0 million related to the write-off of deferred financing costs related to the transaction.

As of October 2, 2022, $949.5 million of the 2024 Notes, $365.0 million of the 2025 Notes, and $500.0 million of the 2027 Notes, were issued and outstanding. Interest payments of $23.1 million for the 2024 Notes are due semi-annually on January 31 and July 31 of each year. Following the repayment of $360 million of the 2025 Notes, interest payments of $12.7 million for the 2025 Notes are due semi-annually on January 1 and July 1 each year. Interest payments of $13.8 million for the 2027 Notes are due semi-annually on April 15 and October 15 of each year.

Long-Term Indebtedness Summary

As of October 2, 2022, January 2, 2022, and October 3, 2021, the principal balance of our long-term debt consisted of the following:


	As of
(Amounts in thousands)	October 2, 2022		January 2, 2022		October 3, 2021
Second Amended and Restated Credit Facility
Second Amended and Restated Term Loan B	$	479,000	$	479,000	$	479,000
Second Amended and Restated Revolving Loan		110,000		—		—
2024 Notes		949,490		949,490		949,490
2025 Notes		365,000		725,000		725,000
2027 Notes		500,000		500,000		500,000
Net discount		(2,416)		(3,249)		(3,526)
Deferred financing costs		(11,854)		(20,717)		(22,161)
Total debt	$	2,389,220	$	2,629,524	$	2,627,803
Less short-term borrowings		(110,000)		—		—
Total long-term debt	$	2,279,220	$	2,629,524	$	2,627,803

Fair-Value of Long-Term Indebtedness

As of October 2, 2022, January 2, 2022, and October 3, 2021, the fair value of our long-term debt, excluding discounts and deferred financing costs, was $2,259.2 million, $2,703.5 million and $2,692.4 million, respectively.