11.Debt

Long-term debt, net consists of the following (in thousands):


		March 31,		December 30,
		2019		2018
Outstanding debt	$	379,982	$	625,009
Unamortized debt issuance costs		(3,567)		(3,874)
Current portion of long-term debt		(29,982)		(20,009)
Total long-term debt, less current portion, net	$	346,433	$	601,126

The Company has a secured revolving credit facility with available borrowings of $400.0 million (the “Revolving Facility”) and a secured term loan facility with an outstanding balance of $370.0 million (the “Term Loan Facility”) and together with the Revolving Facility, the “PJI Facilities”. The PJI Facilities mature on August 30, 2022. The loans under the PJI Facilities accrue interest at a per annum rate equal to, at the Company’s election, either a LIBOR rate plus a margin ranging from 125 to 250 basis points or a base rate (generally determined by a prime rate, federal funds rate or a LIBOR rate plus 1.00%) plus a margin ranging from 25 to 150 basis points. In each case, the actual margin is determined according to a ratio of the Company’s total indebtedness to earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the then most recently ended four-quarter period (the “Leverage Ratio”). The Credit Agreement governing the PJI Facilities (the “PJI Credit Agreement”) places certain customary restrictions upon the Company based on its financial covenants. These include limiting the repurchase of common stock and not increasing the cash dividend above the lesser of $0.225 per share per quarter or $35 million per fiscal year if the Company’s leverage ratio is above 3.75 to 1.0. Quarterly amortization payments are required to be made on the Term Loan Facility in the amount of $5.0 million which began in the fourth quarter of 2017. Loans outstanding under the PJI Facilities may be prepaid at any time without premium or penalty, subject to customary breakage costs in the case of borrowings for which a LIBOR rate election is in effect. Up to $35.0 million of the Revolving Facility may be advanced in certain agreed foreign currencies, including Euros, Pounds Sterling, Canadian Dollars, Japanese Yen, and Mexican Pesos.

The PJI Credit Agreement contains customary affirmative and negative covenants, including financial covenants requiring the maintenance of the Leverage Ratio and a specified fixed charge coverage ratio. The PJI Credit Agreement allows for a permitted Leverage Ratio of 5.25 to 1.0 beginning in the third quarter of 2018, decreasing over time to 4.00 to 1.0 by 2022; and a fixed charge coverage ratio of 2.00 to 1.0 beginning in the third quarter of 2018 and increasing over time to 2.50 to 1.0 in 2021 and thereafter. We were in compliance with these financial covenants at March 31, 2019.

Under the PJI Credit Agreement, we have the option to increase the Revolving Facility or the Term Loan Facility in an aggregate amount of up to $300.0 million, subject to the Leverage Ratio of the Company not exceeding 4.00 to 1.00. The Company and certain direct and indirect domestic subsidiaries are required to grant a security interest in substantially all of the capital stock and equity interests of their respective domestic and first tier material foreign subsidiaries to secure the obligations owing under the PJI Facilities.

Our outstanding debt under the PJI Facilities at March 31, 2019 was composed of $370.0 million outstanding under the Term Loan Facility, with no amount outstanding under the Revolving Facility. Including outstanding letters of credit, the Company’s remaining availability under the PJI Facilities at March 31, 2019 was approximately $360.0 million.

As of March 31, 2019, the Company had approximately $3.6 million in unamortized debt issuance costs, which are being amortized into interest expense over the term of the PJI Facilities.

We attempt to minimize interest risk exposure by fixing our rate through the utilization of interest rate swaps, which are derivative financial instruments. Our swaps are entered into with financial institutions that participate in the PJI Credit Agreement. By using a derivative instrument to hedge exposures to changes in interest rates, we expose ourselves to credit risk. Credit risk is due to the possible failure of the counterparty to perform under the terms of the derivative contract.

We use interest rate swaps to hedge against the effects of potential interest rate increases on borrowings under our PJI Facilities. As of March 31, 2019, we have the following interest rate swap agreements with a total notional value of $400 million:


Effective Dates	Floating Rate Debt			Fixed Rates
April 30, 2018 through April 30, 2023	$	55	million	2.33	%
April 30, 2018 through April 30, 2023	$	35	million	2.36	%
April 30, 2018 through April 30, 2023	$	35	million	2.34	%
January 30, 2018 through August 30, 2022	$	100	million	1.99	%
January 30, 2018 through August 30, 2022	$	75	million	1.99	%
January 30, 2018 through August 30, 2022	$	75	million	2.00	%
January 30, 2018 through August 30, 2022	$	25	million	1.99	%

The gain or loss on the swaps is recognized in other comprehensive (loss) income and reclassified into earnings as adjustments to interest expense in the same period or periods during which the swaps affect earnings. Gains or losses on the swaps representing hedge components excluded from the assessment of effectiveness are recognized in current earnings.

During the three-month period ended March 31, 2019, the Company paid down a substantial portion of debt under its Revolving Facility using the investment proceeds received from Starboard in the Series B Preferred Stock offering. Based on the updated debt forecast, the Company de-designated hedge accounting on two of its interest rate swap agreements. In April 2019, we terminated two swap agreements with a total notional value of $50 million, which leaves the Company with interest swaps of a total notional value of $350 million. The termination of the two interest rate swap agreements was not significant to our results of operations.

The following table provides information on the location and amounts of our swaps in the accompanying condensed consolidated financial statements (in thousands):


	Interest Rate Swap Derivatives
	Fair Value		Fair Value
	March 31,		December 30,
Balance Sheet Location	2019		2018

Other current and long-term assets	$	396	$	4,905

The effect of derivative instruments on the accompanying condensed consolidated financial statements is as follows (in thousands):

Location of Gain

Amount of Gain

Total Net interest expense

Derivatives -

Amount of Gain or

or (Loss)

on Condensed

Cash Flow

(Loss) Recognized

Reclassified from

Consolidated

Hedging

in AOCI/AOCL

AOCI/AOCL into

Statements of

Relationships

on Derivative

Income

Operations

Interest rate swaps for the three months ended:

March 31, 2019

(3,955)

Interest income

148

(6,276)

April 1, 2018

6,718

Interest expense

(108)

(5,075)

The weighted average interest rates on our PJI Facilities, including the impact of the interest rate swap agreements, were 4.5% and 3.5% for the three months ended March 31, 2019 and April 1, 2018, respectively. Interest paid, including payments made or received under the swaps, was $6.7 million and $4.9 million for the three months ended March 31, 2019 and April 1, 2018, respectively. As of March 31, 2019, the portion of the aggregate $396,000 interest rate swap asset that would be reclassified into earnings during the next twelve months is not material given the swap position.

PJMF has a $20.0 million revolving line of credit (the “PJMF Revolving Facility”) pursuant to a Revolving Loan Agreement, dated September 30, 2015 (as amended, the “PJMF Loan Agreement”) with U.S. Bank National Association, as lender (“U.S. Bank”). The PJMF Revolving Facility is secured by substantially all assets of PJMF. The PJMF Revolving Facility matures on December 27, 2019. The borrowings under the PJMF Revolving Facility accrue interest at a variable rate of the one-month LIBOR plus 1.75%. The applicable interest rates on the PJMF Revolving Facility were 4.26% and 3.31% as of March 31, 2019, and April 1, 2018, respectively. As of March 31, 2019, the principal amount of debt outstanding under the PJMF Revolving Facility was $10.0 million and is classified as current debt. The PJMF operating results and the related debt outstanding do not impact the financial covenants under the PJI Credit Agreement.