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Note 7 Debt | 12 Months Ended
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Oct. 01, 2011
Debt Disclosure [Abstract] |
Debt Disclosure [Text Block] | Debt Long-term debt consisted of the following:
| As of
| October 1, 2011 |  | October 2, 2010
| (In thousands)
6.75% Senior Subordinated Notes due 2013 | $ | — |  |  | $ | 380,000 |
Senior Floating Rate Notes due 2014 | 257,410 |  |  | 257,410 |
8.125% Senior Subordinated Notes due 2016 | 400,000 |  |  | 600,000 |
Senior Notes due 2019 | 500,000 |  |  | — |
Fair value adjustment (1) | 24,898 |  |  | 3,256 |
Total long-term debt | $ | 1,182,308 |  |  | $ | 1,240,666 |
(1) Represents fair value hedge accounting balance related to interest rate swaps. See Note 5 for discussion of interest rate swap entered into during the third quarter of 2011. Senior Notes Due 2019. During 2011, the Company issued $500.0 million aggregate principal amount of senior notes due 2019 (the "2019 Notes"). The 2019 Notes mature on May 15, 2019 and bear interest at an annual rate of 7%, payable semi-annually in arrears in cash. In connection with issuance of the 2019 Notes, the Company incurred debt issuance costs of $11.0 million. These costs are included in other non-current assets on the consolidated balance sheet. As of October 1, 2011, unamortized debt issuance costs of $10.5 million are being amortized to interest expense over the term of the 2019 Notes using the effective interest method. The 2019 Notes are senior unsecured obligations and are fully and unconditionally guaranteed on a senior, unsecured basis by substantially all of the Company's domestic subsidiaries. The Company may redeem all or any portion of the 2019 Notes at any time prior to May 15, 2014, at par plus accrued and unpaid interest plus a make-whole premium. The Company may redeem all or any portion of the 2019 Notes beginning on or after May 15, 2014, at redemption prices ranging from 100% to 105.25% of the principal amount, plus accrued and unpaid interest. Following a change of control, as defined, each holder of the 2019 Notes shall have the right to require the Company to repurchase all or any portion of such holder's 2019 Notes at a purchase price equal to 101% of the principal amount, plus accrued and unpaid interest. As discussed in Note 5, the Company entered into an interest rate swap to hedge its exposure to changes in the fair value of the 2019 Notes resulting from changes in interest rates. As of October 1, 2011, the fair value hedge accounting adjustment related to the 2019 Notes was $24.9 million and has been recorded as an increase to long-term debt. 6.75% Senior Subordinated Notes. During 2005, the Company issued $400.0 million of its 6.75% Senior Subordinated Notes due 2013 (the “2013 Notes”), with a maturity date of March 1, 2013. During 2011, the Company fully redeemed the remaining outstanding 2013 Notes with a principal balance of $380 million and recorded a loss on extinguishment of $3.3 million, consisting of redemption premiums of $0.7 million, third party costs of $0.9 million and a write-off of unamortized debt issuance costs of $1.7 million. During 2010, the Company repurchased $20.0 million of its 2013 Notes at par plus a nominal premium. In connection with this repurchase, the Company recorded a loss of $0.4 million, consisting primarily of unamortized debt issuance costs. During 2009, the Company terminated its revolving credit facility and entered into a new credit facility. In connection with the termination of the revolving credit facility, the Company also terminated an interest rate swap associated with its 2013 Notes. As a result of terminating the swap, the Company was required to discontinue hedge accounting for the terminated swap and the remaining three swaps designated under ASC Topic 815 as hedges of the 2013 Notes. These swaps were being accounted for as fair value hedges. At the date hedge accounting was discontinued, the swaps had a fair value of $5.7 million, which was recorded as long-term debt and was being amortized as a reduction to interest expense over the remaining life of the debt. During the second quarter of 2009, the Company received termination notices from its remaining counterparties exercising their right pursuant to embedded call options to cancel the interest rate swaps. In connection with the termination of these swaps, the Company received a payment consisting of a call premium of $11.4 million plus accrued interest. Of the amount received, $5.7 million was recorded as long-term debt (as discussed above) and $5.7 million, representing the change in fair value of the swaps from the date hedge accounting was discontinued until the date the swaps were terminated, was recorded as a gain in other income (expense), net. Senior Floating Rate Notes. In 2007, the Company issued $300.0 million of Senior Floating Rate Notes due June 15, 2010 (the “2010 Notes”) and $300.0 million of Senior Floating Rate Notes due June 15, 2014 (the “2014 Notes”). During 2010, the Company fully redeemed all remaining outstanding 2010 Notes in the amount of $175.7 million at par. During 2009, the Company repurchased $4.3 million and $42.6 million of its 2010 and 2014 Notes, respectively. Upon repurchase, holders of the notes received $31.5 million, plus accrued interest of $0.4 million. In connection with repurchases made during 2009, the Company recorded a gain of $8.5 million, net of unamortized debt issuance costs of $0.8 million and a charge of $6.1 million related to an interest rate swap that was dedesignated. During 2008, the Company redeemed $120.0 million of the 2010 Notes at par. The 2014 Notes bear interest equal to three-month LIBOR plus 2.75% and are senior unsecured obligations and rank equal in right of payment with all of the Company's existing and future senior unsecured debt. The Company may redeem the 2014 Notes, in whole or in part, at redemption prices ranging from 100% to 102% of the principal amount, plus accrued and unpaid interest. As of October 1, 2011, unamortized debt issuance costs of $2.6 million are included in other non-current assets on the consolidated balance sheet and are being amortized to interest expense over the life of the 2014 Notes using the effective interest method. In 2007, the Company entered into interest rate swap transactions with independent third parties to partially hedge the Notes. The interest rate swaps had a total notional amount of $300.0 million and were designated as cash flow hedges. As a result of debt repurchases in 2010, the swap was reduced to $257 million. The Company believes the likelihood that floating rate debt in the amount of $257 million will exist through swap maturity in 2014 is probable and therefore will continue to apply hedge accounting to this portion of the swap. 8.125% Senior Subordinated Notes. During 2006, the Company issued $600.0 million of 8.125% Senior Subordinated Notes due 2016 (the “2016 Notes”) with a maturity date of March 1, 2016. The 2016 Notes are unsecured and subordinated in right of payment to all of the Company's existing and future senior debt. During 2011, the Company repurchased $200 million of these notes for a purchase price of $208.6 million and recognized a loss on extinguishment of $12.8 million, consisting of redemption premiums of $8.6 million, third party costs of $0.5 million and a write-off of unamortized debt costs of $3.7 million. As of October 1, 2011, $6.9 million of unamortized debt issuance costs are included in other non-current assets on the consolidated balance sheet and are being amortized to interest expense over the life of the debt using the effective interest method. The Company may redeem the 2016 Notes, in whole or in part, beginning on March 1, 2011, at declining redemption prices ranging from 104.063% to 100% of the principal amount, plus accrued and unpaid interest, with the actual redemption price to be determined based on the date of redemption. None of the Company's notes have financial covenants, but do have covenants that limit the Company's ability to, among other things: incur additional debt, make investments and other restricted payments, pay dividends on capital stock, or redeem or repurchase capital stock or subordinated obligations; create specified liens; sell assets; create or permit restrictions on the ability of its restricted subsidiaries to pay dividends or make other distributions to the Company; engage in transactions with affiliates; incur layered debt; and consolidate or merge with or into other companies or sell all or substantially all of its assets. The restricted covenants are subject to a number of important exceptions and qualifications. The indentures for the Company's notes provide for customary events of default, including payment defaults, breaches of covenants, certain payment defaults at final maturity or acceleration of certain other indebtedness, failure to pay certain judgments, certain events of bankruptcy, insolvency and reorganization and certain instances in which a guarantee ceases to be in full force and effect. If any event of default occurs and is continuing, subject to certain exceptions, the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding notes may declare all the notes to be due and payable immediately, together with any accrued and unpaid interest, if any. In the case of an event of default resulting from certain events of bankruptcy, insolvency or reorganization, such amounts with respect to the notes will be due and payable immediately without any declaration or other act on the part of the trustee or the holders of the notes. Additionally, following a change of control, as defined in the indentures , the Company will be required to make an offer to repurchase all or any portion remaining outstanding of such debt at a purchase price of 101% of the principal amount, plus accrued and unpaid interest. Asset-backed Lending Facility. In 2009, the Company entered into a Loan, Guaranty and Security Agreement (the “Loan Agreement”), among the Company, the financial institutions party thereto from time to time as lenders, and Bank of America, N.A., as agent for such lenders. The Loan Agreement provides for a $135 million secured asset-backed revolving credit facility, which was subsequently increased to $235 million, subject to a reduction of between $25 million to $50 million depending on the Company's borrowing availability, with an initial $50 million letter of credit sublimit. The facility may be increased by an additional $100 million upon obtaining additional commitments from the lenders then party to the Loan Agreement or new lenders. The Loan Agreement expires on November 19, 2013 (the “Maturity Date”). As of October 1, 2011, there were no borrowings and $24.5 million in letters of credit outstanding under the Loan Agreement, and the Company was eligible to borrow $141.2 million. Loans may be advanced under the Loan Agreement based on a borrowing base derived from specified percentages of the value of eligible accounts receivable and inventory. If at any time the aggregate principal amount of the loans outstanding plus the face amount of undrawn letters of credit under the Loan Agreement exceed the borrowing base then in effect, the Company must make a payment or post cash collateral (in the case of letters of credit) in an amount sufficient to eliminate such excess. Loans under the Loan Agreement bear interest, at the Company's option, at a rate equal to LIBOR or a base rate equal to Bank of America, N.A.'s announced prime rate, in each case plus a spread. A commitment fee accrues on any unused portion of the commitments under the Loan Agreement at a rate per annum based on usage. Principal, together with accrued and unpaid interest, is due on the Maturity Date. The Company's obligations under the Loan Agreement are secured by (1) all U.S. and Canadian accounts receivable (with automatic lien releases occurring at time of sale of each eligible accounts receivable transaction); (2) all U.S. and Canadian deposit accounts (except accounts used for collections for certain transactions); (3) all U.S. and Canadian inventory and associated obligations and documents; and (4) a 65% pledge of the capital stock of the Company's first-tier foreign subsidiaries. The Loan Agreement contains a financial covenant that was not applicable to us as of October 1, 2011, and customary affirmative covenants, including covenants regarding the payment of taxes and other obligations, maintenance of insurance, reporting requirements and compliance with applicable laws and regulations. Further, the Loan Agreement contains customary negative covenants limiting the ability of the Company under certain circumstances, among other things, to use the facility to make investments, acquisitions and certain restricted payments, and to sell assets. Upon an event of default, the lenders may declare all outstanding principal and accrued but unpaid interest under the Loan Agreement immediately due and payable. Events of default under the Loan Agreement include payment defaults, cross defaults with certain other indebtedness, breaches of covenants or representations and warranties, change in control of the Company and bankruptcy events. Maturities of long-term debt as of October 1, 2011 were as follows:
| (In thousands)
2012 | $ | — |
2013 | — |
2014 | 257,410 |
2015 | — |
2016 | 400,000 |
Thereafter | 500,000 |
Total | $ | 1,157,410 |
Short-term Debt During 2010, one of the Company's subsidiaries in China entered into a $50 million unsecured working capital loan facility that contains certain negative covenants that, upon default, permit the bank to deny any further advances or extension of credit or to terminate the loan agreement. The facility bears interest at a rate equal to three-month LIBOR plus a spread and expires in April 2012. Additionally, one of the Company's subsidiaries in India entered into a $35 million unsecured working capital loan facility that contains no covenants and expires on June 2012. Borrowings under the facility bear interest at a rate equal to LIBOR plus spread. Amounts outstanding with respect to short-term debt facilities were as follows:
|  | As of
|  | October 1, 2011 |  | October 2, 2010
|  | (In thousands)
China working capital loan facility |  | $ | 30,000 |  |  | $ | 30,000 |
India working capital loan facility |  | 30,200 |  |  | 35,000 |
Total |  | $ | 60,200 |  |  | $ | 65,000 |
As of October 1, 2011, the Company was in compliance with the covenants contained in the indentures relating to its long-term debt, the Loan Agreement and in the instruments defining the terms of its short-term debt.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 129 -Paragraph 2, 4 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 19, 20, 22 -Article 5 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 + Details
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