Short-term and Long-term Debt

9 Months Ended

Sep. 28, 2019

Short-term and long-term debt as of September 28, 2019, and December 29, 2018, consisted of the following:


(Amounts in millions)	September 28, 2019		December 29, 2018
6.125% unsecured notes due 2021	$	250.0	$	250.0
3.25% unsecured notes due 2027	300.0		300.0
4.10% unsecured notes due 2048	400.0		400.0
Other debt*	229.8		182.3
	1,179.8		1,132.3
Less: notes payable

Commercial paper borrowings	(218.8)		(177.1)
Other notes	(13.5)		(9.2)
	(232.3)		(186.3)
Total long-term debt	$	947.5	$	946.0

Includes the net effects of debt amortization costs and fair value adjustments of interest rate swaps.

Notes payable of $232.3 million as of September 28, 2019, included $218.8 million of commercial paper borrowings and $13.5 million of other notes. As of 2018 year end, notes payable of $186.3 million included $177.1 million of commercial paper borrowings and $9.2 million of other notes.

On February 20, 2018, Snap-on commenced a tender offer to repurchase $200 million in principal amount of its unsecured 6.70% notes that were scheduled to mature on March 1, 2019 (the “2019 Notes”), with $26.1 million of the 2019 Notes tendered and repaid on February 27, 2018. On February 20, 2018, Snap-on also issued a notice of redemption for any remaining outstanding 2019 Notes not tendered, with the redemption completed on March 22, 2018. The total cash cost for this tender and redemption was $209.1 million, including accrued interest of $1.5 million. Snap-on recorded $7.8 million for the loss on the early extinguishment of debt related to the 2019 Notes, which included the redemption premium and other issuance costs associated with this debt in “Other income (expense) - net” on the accompanying Condensed Consolidated Statement of Earnings. See Note 16 for additional information on Other income (expense) - net.

On February 20, 2018, Snap-on sold, at a discount, $400 million of unsecured 4.10% long-term notes that mature on March 1, 2048 (the “2048 Notes”). Interest on the 2048 Notes accrues at a rate of 4.10% per year and is paid semi-annually. Snap-on used a portion of the $395.4 million of net proceeds from the sale of the 2048 Notes, reflecting $3.5 million of transaction costs, to repay the 2019 Notes. The remaining net proceeds were used to repay a portion of its then-outstanding commercial paper borrowings and for general corporate purposes.

On September 16, 2019, Snap-on entered into a five-year, $800 million multi-currency revolving credit facility that terminates on September 16, 2024 (the “Credit Facility”); no amounts were outstanding under the Credit Facility as of September 28, 2019. The Credit Facility amended and restated in its entirety Snap-on's previous $700 million multi-currency revolving credit facility that was set to terminate on December 15, 2020. Borrowings under the Credit Facility bear interest at varying rates based on either: (i) Snap-on’s then-current, long-term debt ratings; or (ii) Snap-on’s then-current ratio of consolidated debt net of certain cash adjustments (“Consolidated Net Debt”) to earnings before interest, taxes, depreciation, amortization and certain other adjustments for the preceding four fiscal quarters then ended (the “Consolidated Net Debt to EBITDA Ratio”). The Credit Facility’s financial covenant requires that Snap-on maintain, as of each fiscal quarter end, either (i) a ratio not greater than 0.60 to 1.00 of Consolidated Net Debt to the sum of Consolidated Net Debt plus total equity and less accumulated other comprehensive income or loss (the “Leverage Ratio”); or (ii) a Consolidated Net Debt to EBITDA Ratio not greater than 3.50 to 1.00. Snap-on may, up to two times during any five-year period during the term of the Credit Facility (including any extensions thereof), elect to increase the maximum Leverage Ratio to 0.65 to 1.00 and/or increase the maximum Consolidated Net Debt to EBITDA Ratio to 4.00 to 1.00 for four consecutive fiscal quarters in connection with certain material acquisitions (as defined in the related credit agreement). As of September 28, 2019, the company’s actual ratios of 0.21 and 0.96 respectively, were both within the permitted ranges set forth in this financial covenant. Snap-on generally issues commercial paper to fund its financing needs on a short-term basis and uses the Credit Facility as back-up liquidity to support such commercial paper issuances.