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Long-Term Debt | 3 Months Ended
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Mar. 30, 2019
Long-Term Debt [Abstract] |
Long-Term Debt | Note 6 – Long-Term Debt Long-term debt consists of the following:
|  | March 30, 2019 |  |  | December 31, 2018 |
Credit facility |  | $ | - |  |  | $ | - |
Convertible senior notes, due 2025 |  |  | 498,629 |  |  |  | 495,203 |
Convertible senior debentures, due 2040 |  |  | 144 |  |  |  | 539 |
Convertible senior debentures, due 2041 |  |  | 8,085 |  |  |  | 12,812 |
Convertible senior debentures, due 2042 |  |  | - |  |  |  | 923 |
Deferred financing costs |  |  | (14,028 | ) |  |  | (14,968 | )
|  |  | 492,830 |  |  |  | 494,509 |
Less current portion |  |  | - |  |  |  | - |
|  | $ | 492,830 |  |  | $ | 494,509 |
Convertible Debt Instruments The following table summarizes some key facts and terms regarding the outstanding convertible debt instruments as of March 30, 2019:
|  | Convertible Senior Notes Due 2025 |  |  | Convertible Senior Debentures Due 2040 |  |  | Convertible Senior Debentures Due 2041 |
Issuance date |  | June 12, 2018 |  |  | November 9, 2010 |  |  | May 13, 2011 |
Maturity date |  | June 15, 2025 |  |  | November 15, 2040 |  |  | May 15, 2041 |
Principal amount as of March 30, 2019 |  | $ | 600,000 |  |  | $ | 350 |  |  | $ | 20,790 |
Cash coupon rate (per annum) |  |  | 2.25 | % |  |  | 2.25 | % |  |  | 2.25 | %
Nonconvertible debt borrowing rate at issuance (per annum) |  |  | 5.50 | % |  |  | 8.00 | % |  |  | 8.375 | %
Conversion rate effective March 13, 2019 (per $1 principal amount) |  |  | 31.7536 |  |  |  | 78.7076 |  |  |  | 57.4367 |
Effective conversion price effective March 13, 2019 (per share) |  | $ | 31.49 |  |  | $ | 12.71 |  |  | $ | 17.41 |
130% of the conversion price (per share) |  | $ | 40.94 |  |  | $ | 16.52 |  |  | $ | 22.63 |
Call date |  |  | n/a |  |  | November 20, 2020 |  |  | May 20, 2021 |
The terms of the convertible senior debentures due 2040 and due 2041 are generally congruent. The terms of the fully retired convertible senior debentures due 2042 were also generally congruent to the convertible senior debentures due 2040 and due 2041. Prior to three months before the maturity date, the holders may convert their convertible senior debentures due 2040 and due 2041 only under the following circumstances: (1) during any fiscal quarter after the first full quarter subsequent to issuance, if the sale price of Vishay common stock reaches 130% of the conversion price for a specified period; (2) the trading price of the debentures falls below 98% of the product of the sale price of Vishay's common stock and the conversion rate for a specified period; (3) Vishay calls any or all of the debentures for redemption, at any time prior to the close of business on the third scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events. Prior to December 15, 2024, the holders of the convertible senior notes due 2025 may convert their notes only under the following circumstances: (1) during any fiscal quarter after the fiscal quarter ending September 29, 2018, if the sale price of Vishay common stock reaches 130% of the conversion price for a specified period (initially $40.94); (2) the trading price of the notes falls below 98% of the product of the sale price of Vishay's common stock and the conversion rate for a specified period; or (3) upon the occurrence of specified corporate transactions. The convertible senior debentures due 2040 became convertible subsequent to the September 30, 2017 evaluation of the conversion criteria, and have remained convertible for each subsequent quarterly evaluation through the March 30, 2019 evaluation, due to the sale price of Vishay's common stock exceeding 130% of the conversion price for the applicable periods. The convertible senior debentures due 2040 will remain convertible until June 29, 2019, at which time the conversion criteria will be reevaluated. At the direction of its Board of Directors, the Company intends, upon future conversion of any of the convertible debt instruments, to repay the principal amounts of the convertible debt instruments in cash and settle any additional amounts in shares of Vishay common stock. The excess of the amount that the Company would pay to the holders of the convertible senior debentures due 2040 upon conversion over the carrying value of the liability component of the debentures currently convertible has been reclassified as temporary equity on the consolidated condensed financial statements. The Company intends to finance the principal amount of any converted debentures using borrowings under its credit facility. Accordingly, the debt component of the convertible senior debentures due 2040 continues to be classified as a non-current liability on the consolidated condensed balance sheets. The quarterly cash dividend program of the Company results in adjustments to the conversion rate and effective conversion price for the convertible debt instruments effective as of the ex-dividend date of each cash dividend. The conversion rate and effective conversion price for the convertible senior notes due 2025 is adjusted for quarterly cash dividends to the extent such dividends exceed $0.085 per share of common stock. GAAP requires an issuer to separately account for the liability and equity components of the instrument in a manner that reflects the issuer’s nonconvertible debt borrowing rate when interest costs are recognized in subsequent periods. The resulting discount on the debt is amortized as non-cash interest expense in future periods. The carrying values of the liability and equity components of the convertible debt instruments are reflected in the Company’s consolidated condensed balance sheets as follows:
|  | Principal amount of the debt instruments |  |  | Unamortized discount |  |  | Embedded derivative |  |  | Carrying value of liability component |  |  | Equity component (including temporary equity) - net carrying value |
March 30, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Convertible senior notes due 2025 |  | $ | 600,000 |  |  |  | (101,371 | ) |  |  | - |  |  | $ | 498,629 |  |  | $ | 85,262 |
Convertible senior debentures due 2040 and due 2041 |  | $ | 21,140 |  |  |  | (12,935 | ) |  |  | 24 |  |  | $ | 8,229 |  |  | $ | 8,767 |
Total |  | $ | 621,140 |  |  | $ | (114,306 | ) |  | $ | 24 |  |  | $ | 506,858 |  |  | $ | 94,029 |
December 31, 2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Convertible senior notes due 2025 |  | $ | 600,000 |  |  |  | (104,797 | ) |  |  | - |  |  | $ | 495,203 |  |  | $ | 85,262 |
Convertible senior debentures due 2040, due 2041, and due 2042 |  | $ | 36,556 |  |  |  | (22,352 | ) |  |  | 70 |  |  | $ | 14,274 |  |  | $ | 15,092 |
Total |  | $ | 636,556 |  |  | $ | (127,149 | ) |  | $ | 70 |  |  | $ | 509,477 |  |  | $ | 100,354 |
Interest is payable on the convertible debt instruments semi-annually at the cash coupon rate; however, the remaining debt discount is being amortized as additional non-cash interest expense using an effective annual interest rate equal to the Company’s estimated nonconvertible debt borrowing rate at the time of issuance. In addition to ordinary interest, contingent interest will accrue in certain circumstances relating to the trading price of the convertible senior debentures due 2040 and due 2041 and under certain other circumstances, beginning ten years subsequent to their respective issuance. The convertible senior notes due 2025 do not possess contingent interest features. Interest expense related to the convertible debt instruments is reflected on the consolidated condensed statements of operations for the fiscal quarters ended:
|  | Contractual coupon interest |  |  | Non-cash amortization of debt discount |  |  | Non-cash amortization of deferred financing costs |  |  | Non-cash change in value of derivative liability |  |  | Total interest expense related to the debt instruments |
March 30, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Convertible senior notes due 2025 |  | $ | 3,375 |  |  |  | 3,426 |  |  |  | 454 |  |  |  | - |  |  | $ | 7,255 |
Convertible senior debentures |  | $ | 148 |  |  |  | 64 |  |  |  | 2 |  |  |  | (18 | ) |  | $ | 196 |
Total |  | $ | 3,523 |  |  | $ | 3,490 |  |  | $ | 456 |  |  | $ | (18 | ) |  | $ | 7,451 |
March 31, 2018 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Convertible senior notes due 2025 |  | $ | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  | $ | - |
Convertible senior debentures |  | $ | 3,235 |  |  |  | 1,309 |  |  |  | 47 |  |  |  | 161 |  |  | $ | 4,752 |
Total |  | $ | 3,235 |  |  | $ | 1,309 |  |  | $ | 47 |  |  | $ | 161 |  |  | $ | 4,752 |
The Company used cash to repurchase $960, $12,288 and $2,168 principal amounts of convertible senior debentures due 2040, due 2041, and due 2042, respectively, in the first fiscal quarter of 2019. The net carrying value of the debentures repurchased were $396, $4,770, and $924, respectively. In accordance with the authoritative accounting guidance for convertible debentures, the aggregate repurchase payment of $22,695 was allocated between the liability ($7,311) and equity (including temporary equity, $15,384) components of the convertible debentures, using the Company's nonconvertible debt borrowing rate at the time of the repurchase. As a result, the Company recognized a loss on extinguishment of convertible debentures of $1,307, including the write-off of a portion of unamortized debt issuance costs. The convertible senior debentures due 2042 have been fully repurchased, and the trustee has confirmed that the Company has satisfied and discharged its obligations under the indenture governing the convertible senior debentures due 2042.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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