Note 7 Debt

12 Months Ended

Sep. 30, 2023

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

Debt

Long-term debt consisted of the following:

	As of
	September 30, 2023		October 1, 2022
	(In thousands)
Term Loan Due 2027, net of issuance costs	$	329,827	$	346,737
Less: Current portion of Term Loan Due 2027	17,500		17,500
Long-term debt	$	312,327	$	329,237

Term Loan Due 2027 maturities by fiscal year are as follows:

	As of
	September 30, 2023
	(In thousands)
2024	$	13,125
2025	17,500
2026	21,875
2027	280,000
	$	332,500

On September 27, 2022 (the “Closing Date”), the Company entered into a Fifth Amended and Restated Credit Agreement (the “Credit Agreement”) that provides for a $800 million revolving credit facility and a $350 million secured term loan (“Term Loan Due 2027”). Subject to the satisfaction of certain conditions, including obtaining additional commitments from existing and/or new lenders, the Company may increase the revolving commitment up to an additional $200 million. Costs incurred in connection with Credit Agreement of $3 million are classified as long-term debt and are being amortized to interest expense over the life of the Term Loan Due 2027 using the effective interest method.

The Term Loan Due 2027 was fully drawn on the Closing Date and the proceeds were used to repay the term loan issued under the Company’s prior credit agreement. Upon repayment, the Company recorded a loss on extinguishment of debt of $1 million consisting of a write-off of unamortized debt issuance costs under such prior agreement.

Loans under the Credit Agreement bear interest, at the Company’s option, at either the SOFR or a base rate, in each case plus a spread determined based on the Company’s credit rating. Interest on the loans is payable quarterly in arrears with respect to base rate loans and at the end of an interest period (and at three month intervals if the interest period exceeds three months) in the case of SOFR loans. The outstanding principal amount of all loans under the Credit Agreement, including the Term Loan Due 2027, together with accrued and unpaid interest, is due on September 27, 2027. The Company is required to repay a portion of the principal amount of the Term Loan Due 2027 equal to 1.25% of the principal in quarterly installments.

On May 17, 2023, as a result of the Company’s failure to timely file its quarterly report on Form 10-Q for the quarter ended April 1, 2023, the Company was in technical default with respect to certain covenants within its Credit Agreement. The Company filed its quarterly report on Form 10-Q for the quarter ended April 1, 2023 on May 22, 2023, which was within the stated cure period of 15 calendar days and ceased to be in default as of that time.

Certain of the Company’s domestic subsidiaries are guarantors in respect of the Credit Agreement. The Company and the subsidiary guarantors’ obligations under the Credit Agreement are secured by a lien on substantially all of their respective assets (excluding real property), including cash, accounts receivable and the shares of certain Company subsidiaries, subject to certain exceptions.

As of September 30, 2023, no borrowings and $13 million of letters of credit were outstanding under the Credit Agreement, under which $787 million was available to borrow. There were no borrowings outstanding under the Credit Agreement as of October 1, 2022.

Short-term Borrowing Facilities

The Company had $8 million of short-term borrowings outstanding as of September 30, 2023. Additionally, certain foreign subsidiaries of the Company had a total of $72 million of short-term borrowing facilities available, under which no borrowings were outstanding as of September 30, 2023. These facilities expire at various dates through the first quarter of 2025.

Debt Covenants

The Credit Agreement requires the Company to comply with certain financial covenants, namely a maximum consolidated leverage ratio and a minimum interest coverage ratio, in both cases measured on the basis of a trailing 12 month look-back period. In addition, the Company's debt agreements contain a number of restrictive covenants, including restrictions on incurring additional debt, making investments and other restricted payments, selling assets and paying dividends, subject to certain exceptions. Finally, the agreements also include covenants that require us to file quarterly and annual financial statements with the SEC on a timely basis. The Company was in compliance with these covenants as of September 30, 2023.