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Note 7 Debt | 12 Months Ended
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Sep. 27, 2014
Debt Disclosure [Abstract] |
Debt Disclosure [Text Block] | Debt Long-term debt consisted of the following:
| As of
| September 27, 2014 |  | September 28, 2013
| (In thousands)
Secured debt due 2015 | $ | 40,000 |  |  | $ | 40,000 |
Senior notes due 2019 ("2019 Notes") | 100,000 |  |  | 500,000 |
Senior secured notes due 2019 ("Secured Notes") | 375,000 |  |  | — |
Non-interest bearing notes payable | 15,097 |  |  | — |
Fair value adjustment (1) | 3,757 |  |  | 22,512 |
Total long-term debt | $ | 533,854 |  |  | $ | 562,512 |
Less : Current portion |  |  |
2019 Notes called for redemption in fourth quarter of 2014 | 100,000 |  |  | — |
Fair value adjustment related to remaining 2019 Notes | 3,757 |  |  | — |
Secured debt due in July 2015 | 40,000 |  |  | — |
Current portion of non-interest bearing notes payable | 3,416 |  |  | — |
Long-term debt | $ | 386,681 |  |  | $ | 562,512 |
(1) Represents fair value hedge accounting adjustment related to interest rate swaps. See Note 5 for discussion. Secured Notes. During the third quarter of 2014, the Company entered into an indenture among the Company, certain subsidiaries of the Company, as guarantors (the “Guarantors”), and U.S. Bank National Association, as trustee and as notes collateral agent (the “Indenture”) and issued $375 million aggregate principal amount of senior secured notes due 2019. The Secured Notes mature on June 1, 2019 and bear interest at an annual rate of 4.375%, payable semi-annually in arrears in cash. In connection with issuance of the Secured Notes, the Company incurred debt issuance costs of $5.1 million which are included in other non-current assets on the consolidated balance sheets and are being amortized to interest expense over the term of the Secured Notes using the effective interest method. The Secured Notes are senior secured obligations and are fully and unconditionally guaranteed (the "Guarantees"), jointly and severally, on a senior secured basis by the Guarantors. In connection with the issuance of the Secured Notes, the Company and the Guarantors entered into a Security Agreement, dated June 4, 2014, with U.S. Bank National Association, as notes collateral agent (the “Security Agreement”). The Secured Notes and the Guarantees are secured by a first-priority lien, subject to permitted liens, on certain of the Company’s and the Guarantors’ tangible and intangible assets including certain real property, equipment and intellectual property, and by a second-priority lien on certain of the Company’s and the Guarantors’ assets, including accounts receivable, inventory and stock of subsidiaries, securing the Company’s asset-backed credit facility. All or any portion of the Secured Notes may be redeemed, at any time, at the option of the Company, at a redemption price equal to 100% of the principal amount of the Secured Notes redeemed plus accrued and unpaid interest, plus a make-whole premium. In addition, prior to June 1, 2017, the Company may redeem up to 35% of the aggregate principal amount of the Secured Notes outstanding at a redemption price equal to 104.375% of the principal amount, plus accrued and unpaid interest, with the proceeds of certain equity offerings. Following a change of control, as defined in the Indenture, the Company will be required to make an offer to repurchase all of the Secured Notes at a purchase price of 101% of the principal amount of the Secured Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the date of repurchase. The Indenture includes certain customary covenants that limit the ability of the Company and its restricted subsidiaries to, among other things: •incur additional debt, including guarantees by its restricted subsidiaries;
• | make investments and other restricted payments, pay dividends on capital stock, or redeem or repurchase its 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 or other subsidiaries of the Company;
•engage in transactions with affiliates; and •consolidate or merge with or into other companies or sell all or substantially all of the Company’s assets. The restrictive covenants are subject to a number of important exceptions and qualifications set forth in the Indenture. The Indenture provides for specified events of default, including payment defaults, breaches of covenants, certain payment defaults at final maturity or acceleration of other indebtedness, failure to pay certain judgments, certain events of bankruptcy, insolvency and reorganization involving the Company or certain of its subsidiaries 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 Secured Notes, may declare all the Secured Notes to be due and payable immediately, together with any accrued and unpaid interest, if any, to the acceleration date. In the case of an event of default resulting from certain events of bankruptcy, insolvency or reorganization involving the Company, such amounts with respect to the Secured Notes will be due and payable immediately without any declaration or other act on the part of the trustee or the holders of the Secured Notes. 2019 Notes. During 2011, the Company issued $500 million aggregate principal amount of senior notes due 2019. The 2019 Notes mature on May 15, 2019 and bear interest at an annual rate of 7%, payable semi-annually in arrears in cash. During 2014, the Company redeemed $400 million of its outstanding 2019 Notes at par plus a redemption premium and accrued interest and recorded a net loss on extinguishment of debt of $11.8 million, consisting of redemption premiums of $21.8 million, a write-off of unamortized debt issuance costs of $6.0 million and third party costs of $0.5 million, partially offset by a $16.5 million credit related to the fair value hedge adjustment associated with the extinguished 2019 Notes. Additionally, during the fourth quarter of 2014, the Company called the remaining $100 million of its 2019 Notes for redemption, which was completed early in the first quarter of 2015. These notes were redeemed at par plus a redemption premium and accrued interest. In connection with this redemption, the Company expects to record a net loss on extinguishment of debt of $2.9 million, consisting of redemption premiums of $5.3 million and a write-off of unamortized debt issuance costs of $1.4 million, partially offset by a $3.8 million credit for the fair value hedge adjustment related to the extinguished 2019 Notes. 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 September 27, 2014, the fair value hedge accounting adjustment related to the 2019 Notes was $3.8 million. Secured Debt due 2015. During the fourth quarter of 2012, the Company borrowed $40.0 million using its corporate campus as collateral. The secured debt matures in July 2015, bears interest at LIBOR plus a spread or the bank's prime rate plus a spread, includes two one-year renewal options subject to bank approval and requires compliance with a fixed-charge coverage ratio and customary covenants similar to those of the asset-backed lending facility discussed below. Non-interest Bearing Notes Payable. The Company issued unsecured, interest-free, 5 year term notes (payable annually) with a face value of $17.1 million in connection with assets acquired during the third quarter of 2014. The discounted value of the notes issued was $14.8 million (see Note 17). Maturities of long-term debt, excluding amounts classified as current, as of September 27, 2014 were as follows:
| (In thousands)
2016 | 3,416 |
2017 | 3,416 |
2018 | 3,416 |
2019 | 378,415 |
Thereafter | — |
Short-term Debt Asset-backed Lending Facility. In 2009, the Company entered into a Loan, Guaranty and Security 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. During the second quarter of 2012, the Company entered into an Amended and Restated 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 amended and restated the Company's existing Loan, Guaranty and Security Agreement. The Company incurred $2.7 million of debt issuance costs in connection with this amendment. Such costs are included in other non-current assets on the consolidated balance sheets and are being amortized to interest expense over the life of the facility on a straight-line basis. The Loan Agreement provides for a $300 million secured asset-backed revolving credit facility with a $100 million letter of credit sublimit. The facility may be increased by an additional $200 million upon obtaining additional commitments from the lenders then party to the Loan Agreement or new lenders. The Loan Agreement expires on March 16, 2017 (the “Maturity Date”). As of September 27, 2014, there were no borrowings outstanding, $21.8 million in letters of credit were outstanding and the Company was eligible to borrow $278.2 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. Interest on loans is payable quarterly in arrears with respect to base rate loans and at the end of an interest period in the case of LIBOR loans. 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 and all supporting obligations, chattel paper, documents and instruments in respect thereof or relating thereto; (2) all U.S. and Canadian deposit accounts (except accounts used for collections for certain transactions); (3) all U.S. and Canadian inventory; (4) the equity interests of each of the borrowers (except the Company) and the guarantors and the other equity interests owned directly by the borrowers and the guarantors, subject to limited exceptions; (5) all U.S. and Canadian promissory notes issued by the Designated Canadian Guarantors; (6) all U.S. and Canadian cash in any form; (7) all U.S. and Canadian accessions to, substitutions for, and all replacements, products, and cash and non-cash proceeds of the foregoing; and (8) all U.S. and Canadian books and records pertaining to the foregoing. The Loan Agreement contains a financial covenant that was not applicable to us as of September 27, 2014, and customary 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 incur debt, 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. Foreign Short-term Borrowing Facilities. As of September 27, 2014, certain foreign subsidiaries of the Company had a total of $74.0 million of short-term borrowing facilities, under which no borrowings were outstanding. The borrowing agreements contain certain negative covenants that, upon default, permit the bank to deny any further advances or extension of credit or to terminate the borrowing agreements. These facilities expire at various dates through the end of 2015. Debt Covenants Other than the Company's Secured Debt due 2015, the Company's debt agreements do not contain financial covenants currently applicable to the Company, but do include a number of restrictive covenants, including restrictions on incurring additional debt, making investments and other restricted payments, selling assets, paying dividends and redeeming or repurchasing capital stock and debt, subject to certain exceptions. The Company's secured debt due in 2015 requires the Company to maintain a minimum fixed charge coverage ratio during its term. As of September 27, 2014, the Company was in compliance with all covenants related to its long-term debt instruments, asset backed lending facility and short-term debt facilities.

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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 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: 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 3: 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 + Details
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