DEBT | DEBT Long-term debt is comprised of the following (in thousands): June 30, December 30, Senior secured term loan A $ 346,875 $ 356,250 Senior secured term loan B 913,286 1,014,750 9.125% senior notes due 2023 360,000 360,000 Revolving line of credit 82,000 40,000 Unamortized discount on term loan B and debt issuance costs (36,881 ) (40,837 ) Total debt 1,665,280 1,730,163 Less current portion of long-term debt 25,781 31,344 Total long-term debt $ 1,639,499 $ 1,698,819 Senior Secured Credit Facilities The Company has senior secured credit facilities (the “Senior Secured Credit Facilities”) consisting of (i) a $200 million revolving credit facility (the “Revolving Credit Facility”), (ii) a $375 million term loan A facility (the “TLA Facility”), and (iii) a $1,025 million term loan B facility (the “TLB Facility”). The TLA Facility and TLB Facility are collectively referred to as the “Term Loan Facilities.” The TLB facility was issued at a 1% discount. On March 17, 2017, the Company amended the Senior Secured Credit Facilities to lower the interest rate on the TLB Facility. The amendment reduced the applicable interest rate margins of its TLB Facility for both base rate and adjusted LIBOR borrowings by 75 basis points. The amendment also includes a prepayment fee of 1.00% in the event of another repricing event (as defined in the Senior Secured Credit Facilities) on or before the six -month anniversary of this amendment. There was no change to maturities or covenants under the Senior Secured Credit Facilities as a result of this repricing amendment. (6.) DEBT (Continued) Revolving Credit Facility The Revolving Credit Facility matures on October 27, 2020 . The Revolving Credit Facility also includes a $15 million sublimit for swingline loans and a $25 million sublimit for standby letters of credit. The Company is required to pay a commitment fee on the unused portion of the Revolving Credit Facility, which will range between 0.175% and 0.25% , depending on the Company’s Total Net Leverage Ratio (as defined in the Senior Secured Credit Facilities agreement). Interest rates on the Revolving Credit Facility, as well as the TLA Facility, are at the Company’s option, either at: (i) the prime rate plus the applicable margin, which will range between 0.75% and 2.25% , based on the Company’s Total Net Leverage Ratio, or (ii) the applicable LIBOR rate plus the applicable margin, which will range between 1.75% and 3.25% , based on the Company’s Total Net Leverage Ratio. As of June 30, 2017 , the Company had $82 million of outstanding borrowings on the Revolving Credit Facility and an available borrowing capacity of $109.2 million after giving effect to $8.8 million of outstanding standby letters of credit. As of June 30, 2017 , the weighted average interest rate on all outstanding borrowings under the Revolving Credit Facility was 4.37% . Subject to certain conditions, commitments under the Revolving Credit Facility may be increased through an incremental revolving facility so long as, on a pro forma basis, the Company’s first lien net leverage ratio does not exceed 4.25 :1.00. The outstanding amount of the Revolving Credit Facility approximated its fair value as of June 30, 2017 based upon the debt being variable rate and short-term in nature. Term Loan Facilities The TLA Facility and TLB Facility mature on October 27, 2021 and October 27, 2022 , respectively. Interest rates on the TLB Facility are, at the Company’s option, either at: (i) the prime rate plus 2.50% or (ii) the applicable LIBOR rate plus 3.50% , with LIBOR subject to a 1.00% floor. As of June 30, 2017 , the interest rates on the TLA Facility and TLB Facility were 4.47% and 4.71% , respectively. Subject to certain conditions, one or more incremental term loan facilities may be added to the Term Loan Facilities so long as, on a pro forma basis, the Company’s first lien net leverage ratio does not exceed 4.25 :1.00. As of June 30, 2017 , the estimated fair value of the TLB Facility was approximately $918 million , based on quoted market prices for the debt, recent sales prices for the debt and consideration of comparable debt instruments with similar interest rates and trading frequency, among other factors, and is classified as Level 2 measurements within the fair value hierarchy. The par amount of the TLA Facility approximated its fair value as of June 30, 2017 based upon the debt being variable rate in nature. Covenants The Revolving Credit Facility and TLA Facility contain covenants requiring (A) a maximum Total Net Leverage Ratio of 6.25 :1.00, subject to step downs beginning in the first quarter of 2018 and (B) a minimum interest coverage ratio of adjusted EBITDA (as defined in the Senior Secured Credit Facilities) to interest expense of not less than 2.50 :1.00 subject to step ups beginning in the first quarter of 2018. The TLB Facility does not contain any financial maintenance covenants. As of June 30, 2017 , the Company was in compliance with these financial covenants. The Senior Secured Credit Facilities also contain negative covenants that restrict the Company’s ability to (i) incur additional indebtedness; (ii) create certain liens; (iii) consolidate or merge; (iv) sell assets, including capital stock of the Company’s subsidiaries; (v) engage in transactions with the Company’s affiliates; (vi) create restrictions on the payment of dividends or other amounts from the Company’s restricted subsidiaries; (vii) pay dividends on capital stock or redeem, repurchase or retire capital stock; (viii) pay, prepay, repurchase or retire certain subordinated indebtedness; (ix) make investments, loans, advances and acquisitions; (x) make certain amendments or modifications to the organizational documents of the Company or its subsidiaries or the documentation governing other senior indebtedness of the Company; and (xi) change the Company’s type of business. These negative covenants are subject to a number of limitations and exceptions that are described in the Senior Secured Credit Facilities agreement. As of June 30, 2017 , the Company was in compliance with all negative covenants under the Senior Secured Credit Facilities. The Senior Secured Credit Facilities provide for customary events of default. Upon the occurrence and during the continuance of an event of default, the outstanding advances and all other obligations under the Senior Secured Credit Facilities become immediately due and payable. (6.) DEBT (Continued) 9.125% Senior Notes due 2023 On October 27, 2015, the Company completed a private offering of $360 million aggregate principal amount of 9.125% senior notes due on November 1, 2023 (the “Senior Notes”). Interest on the Senior Notes is payable on May 1 and November 1 of each year. As of June 30, 2017 , the estimated fair value of the Senior Notes was approximately $383 million , based on quoted market prices of these Senior Notes, recent sales prices for the Senior Notes and consideration of comparable debt instruments with similar interest rates and trading frequency, among other factors, and is classified as Level 2 measurements within the fair value hierarchy. The indenture for the Senior Notes contain certain restrictive covenants and provides for customary events of default, subject in certain cases to customary cure periods, in which the Senior Notes and any unpaid interest would become due and payable. As of June 30, 2017 , the Company was in compliance with all restrictive covenants under the indenture governing the Senior Notes. Contractual maturities under the Senior Secured Credit Facilities and Senior Notes for the remainder of 2017 and the five years and thereafter, excluding any discounts or premiums, as of June 30, 2017 are as follows (in thousands): 2017 2018 2019 2020 2021 After 2021 Future minimum principal payments $ 11,718 $ 30,469 $ 37,500 $ 119,500 $ 229,688 $ 1,273,286 Debt Issuance Costs and Discounts The change in deferred debt issuance costs related to the Revolving Credit Facility is as follows (in thousands): December 30, 2016 $ 3,800 Amortization during the period (496 ) June 30, 2017 $ 3,304 The change in unamortized discount and debt issuance costs related to the Term Loan Facilities and Senior Notes is as follows (in thousands): Debt Issuance Costs Unamortized Discount on TLB Facility Total December 30, 2016 $ 32,096 $ 8,741 $ 40,837 Financing costs incurred 1,789 — 1,789 Write-off of debt issuance costs and unamortized discount (1) (1,702 ) (792 ) (2,494 ) Amortization during the period (2,607 ) (644 ) (3,251 ) June 30, 2017 $ 29,576 $ 7,305 $ 36,881 (1) The Company prepaid a portion of its TLB Facility during the first and second quarters of 2017. The Company recognized losses from extinguishment of debt during the three and six months ended June 30, 2017 of $0.9 million and $2.5 million , respectively, which is included in Interest Expense, Net in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The loss from extinguishment of debt represents the portion of the unamortized discount and debt issuance costs related to the TLB Facility prepaid. Interest Rate Swaps From time to time, the Company enters into interest rate swap agreements in order to hedge against potential changes in cash flows on its outstanding variable rate debt. During 2016, the Company entered into a one -year $250 million interest rate swap and a three -year $200 million interest rate swap to hedge against potential changes in cash flows on the outstanding variable rate debt, which is indexed to the one-month LIBOR rate. The variable rate received on the interest rate swap and the variable rate paid on the outstanding debt will have the same rate of interest, excluding the credit spread, and will reset and pay interest on the same date. The swaps are being accounted for as cash flow hedges. (6.) DEBT (Continued) Information regarding the Company’s outstanding interest rate swap designated as a cash flow hedge as of June 30, 2017 is as follows (dollars in thousands): Notional Amount Start Date End Date Pay Fixed Rate Receive Current Floating Rate Fair Value Balance Sheet Location $ 200,000 Jun-17 Jun-20 1.1325 % 1.22 % $ 3,015 Other Long-Term Assets The estimated fair value of the interest rate swap agreement represents the amount the Company would receive (pay) to terminate the contract. No portion of the change in fair value of the Company’s interest rate swap during the six months ended June 30, 2017 and July 1, 2016 was considered ineffective. The amount recorded as a reduction to Interest Expense during the six months ended June 30, 2017 related to the Company’s interest rate swaps was $0.3 million . The estimated Accumulated Other Comprehensive Income (Loss) related to the Company’s interest rate swaps that is expected to be reclassified into earnings within the next twelve months is a $0.5 million gain. |