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Long-Term Debt
 3 Months Ended
Mar. 31, 2012
Debt Disclosure [Abstract]  
Long-Term Debt [Text Block]
Long-Term Debt
 
Long-term debt is as follows (in thousands):
 
 
March 31, 2012
 
December 31, 2011
Revolving credit facility, due 2014
$
65,600

 
$
—

77/8% senior subordinated notes, due 2013
152,621

 
284,878

 83/8% senior subordinated notes, due 2014 ($25.2 million outstanding principal amount as of December 31, 2011)
—

 
25,424

Term Loan B, due 2016 ($311.1 million and $356.2 million outstanding principal amount as of March 31, 2012 and December 31, 2011, respectively)
308,617

 
353,033

101/2% senior notes, due 2016
—

 
170,000

7% senior exchangeable notes, due 2017
86,250

 
—

111/2% senior notes, due 2017 ($225.0 million outstanding principal amount as of March 31, 2012)
216,738

 
—

87/8% senior second lien notes, due 2018 ($400.0 million outstanding principal amount as of March 31, 2012 and December 31, 2011)
397,776

 
397,704

Other debt including capital leases
14,164

 
15,304

 
1,241,766

 
1,246,343

Less current maturities
(12,130
)
 
(8,809
)
Long-term debt
$
1,229,636

 
$
1,237,534


The estimated fair value of the Company’s long-term debt was approximately $1.2 billion and $1.1 billion as of March 31, 2012 and December 31, 2011, respectively. The fair value was determined by the Company to be Level 2 under the fair value hierarchy and was based upon review of observable pricing in secondary markets for each debt instrument.

As of March 31, 2012, the Company was in compliance with all debt agreement covenants.

111/2% Senior Notes
 
On March 28, 2012, the Company issued $225 million aggregate principal amount of 111/2% senior notes due 2017 (the “111/2% Notes”) that were sold with registration rights to qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933, and to certain non-U.S. persons in accordance with Regulation S under the Securities Act of 1933.  The 111/2% Notes were issued at a discount of approximately $8.3 million, of which substantially all remains unamortized as of March 31, 2012. The 111/2% Notes were issued pursuant to an indenture (the “111/2% Indenture”) among the Company, certain subsidiary guarantors and U.S. Bank National Association, as trustee. The Company will pay interest on the 111/2% Notes semi-annually, in cash in arrears, on May 15 and November 15 of each year, commencing May 15, 2012. The 111/2% Notes have no required principal payments prior to their maturity on May 15, 2017.  The 111/2% Notes are guaranteed on a senior unsecured basis by the Company and substantially all of its existing and future North American subsidiaries. As such, the 111/2% Notes rank pari passu with all of the Company's existing and future senior debt and senior to any of the Company's subordinated debt. The Company may redeem the 111/2% Notes, in whole or in part, on or after May 15, 2015, at redemption prices ranging from 100.0% to approximately 105.75%, plus accrued and unpaid interest. In addition, at any time prior to May 15, 2015, the Company may redeem up to 35% of the aggregate principal amount of the notes originally issued with the net cash proceeds of certain public equity offerings, at a redemption price of 111.50% plus accrued and unpaid interest. The Company may also redeem some or all of the 111/2% Notes before May 15, 2015 at a redemption price of 100% of the principal amount, plus accrued and unpaid interest, if any, to the redemption date, plus a “make whole” premium. Each holder of the 111/2% Notes has the right to require the Company to repurchase such holder's notes at a purchase price of 101% of the principal amount thereof, plus accrued and unpaid interest thereon, upon the occurrence of certain events specified in the indenture that constitute a change of control. The 111/2% Indenture contains a number of covenants that, among other things, restrict, subject to certain exceptions, the Company's ability and the ability of the Company's subsidiaries, to incur or guarantee additional indebtedness, make restricted payments (including paying dividends on, redeeming or repurchasing our capital stock), permit restricted subsidiaries to pay dividends or make other distributions or payments, dispose of assets, make investments, grant liens on assets, merge or consolidate or transfer certain assets, and enter into transactions with affiliates. The 111/2% Indenture also contains certain customary affirmative covenants.

7% Senior Exchangeable Notes
 
Concurrently with the 111/2% Notes, the Company issued $86.25 million aggregate principal amount of senior exchangeable notes due 2017 (the “7% Notes”) that were sold to qualified institutional buyers in accordance with Rule 144A under the Securities Act of 1933.  The 7% Notes were issued pursuant to an indenture (the “7% Indenture”) among the Company, certain subsidiary guarantors and U.S. Bank National Association, as trustee. The Company will pay interest on the 7% Notes semi-annually, in cash in arrears, on May 15 and November 15 of each year, commencing November 15, 2012. The 7% Notes have no required principal payments prior to their maturity on May 15, 2017.  The 7% Notes are guaranteed on a senior unsecured basis by the Company and substantially all of its North American subsidiaries. As such, the 7% Notes rank pari passu with all of the Company's existing and future senior debt and senior to any of the Company's subordinated debt. The Company may not redeem the notes at its option. Upon a fundamental change, as defined in the 7% Indenture, holders of 7% Notes may require the Company to repurchase all or a portion of such holder's notes for cash at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus any accrued and unpaid interest to, but excluding, the fundamental change repurchase date, as defined in the 7% Indenture. The 7% Indenture does not contain any financial covenants or any restrictions, among other things, on the payment of dividends, the incurrence of other indebtedness, or the issuance or repurchase of securities by the Company. The 7% Indenture does not contain any covenants or other provisions to protect holders of the notes in the event of a highly leveraged transaction or a change of control, except to the extent described in the 7% Indenture.

The 7% Notes are exchangeable at any time prior to the close of business on the business day immediately preceding the maturity date for shares of the Company's common stock at an exchange rate of 241.5167 shares per $1,000 principal amount of 7% Notes, which is equal to an exchange price of approximately $4.14 per share, subject to adjustment under certain specified circumstances. This represents a premium of 22.5% above the last reported sale price of Cenveo's common stock on the New York Stock Exchange on Thursday, March 22, 2012, which was $3.38 per share. If a holder elects to exchange notes in connection with a make-whole fundamental change, as described in the 7% Indenture, such holder may also be entitled to receive a make-whole premium upon exchange in certain circumstances.

2012 Refinancing

Net proceeds of the 111/2% Notes and 7% Notes together with borrowings under the Company's $170 million revolving credit facility, due 2014 (“2010 Revolving Credit Facility”) were used to fund the cash tender offers for any and all of the Company's 83/8% senior subordinated notes due 2014 (the “83/8% Notes”) and 101/2% senior notes due 2016 (the “101/2% Notes”), plus $45 million aggregate principal amount of the Company's 77/8% senior subordinated notes due 2013 (the “77/8% Notes”) and to repurchase an additional $73.4 million of 77/8% Notes through open market, negotiated purchases to refinance such indebtedness, and to pay related fees and expenses (collectively the “2012 Refinancing”). In connection with the issuance of the 111/2% Notes and the 7% Notes, the Company capitalized debt issuance costs of $6.0 million and $3.0 million, respectively, all of which will be amortized over the life of the 111/2% Notes and the 7% Notes. On April 3, 2012, in connection with the 2012 Refinancing, an additional $3.1 million of 77/8% Notes settled through a negotiated purchase.

2012 Amended Credit Facilities

In February of 2012, the Company amended the 2010 Credit Facilities (the “2012 Amendment”), which includes the 2010 Revolving Credit Facility and a $380 million term loan due 2016 (“Term Loan B”), to increase its restricted dispositions basket in connection with the sale of the Documents Group. The 2012 Amendment required that 25% of net proceeds be used to repay the Term Loan B and requires that the remaining amount be used to reinvest in the business or refinance certain existing debt. On February 14, 2012, the Company repaid $9.5 million of the Term Loan B in connection with this provision. The 2012 Amendment required the Company to repay unsecured and second lien debt in an amount equal to 75% of the net proceeds. In connection with the 2012 Amendment, the Company paid $1.7 million to consenting lenders and related fees, which are included in discontinued operations in the condensed consolidated statement of operations.

Effective March 5, 2012, the Company increased its borrowing capacity under the 2010 Revolving Credit Facility to $170 million from $150 million as a result of receiving an additional commitment, as permitted under the 2010 Credit Facilities. On March 9, 2012, the Company repaid $34.7 million of its Term Loan B as part of its required excess cash flow payment.

Extinguishments
 
In connection with the 2012 Refinancing, the Company incurred a loss from early extinguishment of debt of $12.7 million, of which $9.6 million related to tender and consent fees paid to consenting lenders of its 77/8% Notes, 101/2% Notes and 83/8% Notes and $3.1 million relates to the write-off of previously unamortized debt issuance costs.

In the first quarter of 2012, and prior to the 2012 Refinancing, the Company purchased in the open market approximately $13.8 million, $5.0 million and $2.0 million of its 77/8% Notes, 101/2% Notes and 83/8% Notes, respectively, and retired them for $12.2 million, $4.9 million and $1.6 million, respectively, plus accrued and unpaid interest.  In connection with the retirement of these 77/8% Notes, 101/2% Notes and 83/8% Notes, the Company recorded a gain on early extinguishment of debt of approximately $2.1 million, which includes the write-off of $0.1 million of unamortized debt issuance costs.