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Debt and Credit Arrangements | 12 Months Ended
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Dec. 31, 2017
Debt and Credit Arrangements |
Debt and Credit Arrangements | 9. Debt and Credit Arrangements Long-term debt, net consists of the following (in thousands):
|  |  |  | December 31, |  |  | December 25,
|  |  |  | 2017 |  |  | 2016
Outstanding debt |  |  | $ | 470,000 |  | $ | 300,575
Unamortized debt issuance costs |  |  |  | (3,435) |  |  | (755)
Current portion of long-term debt |  |  |  | (20,000) |  |  | -
Total long-term debt, less current portion, net |  |  | $ | 446,565 |  | $ | 299,820
Our outstanding debt of $470.0 million at December 31, 2017 represented amounts outstanding under a new credit agreement. On August 30, 2017, we entered into a new credit agreement (the “Credit Agreement”) replacing the previous $500.0 million credit facility (“Previous Credit Facility”). The Credit Agreement provides for an unsecured revolving credit facility in an aggregate principal amount of $600.0 million (the “Revolving Facility”) and an unsecured term loan facility in an aggregate principal amount of $400.0 million (the “Term Loan Facility” and together with the Revolving Facility, the “Facilities”). Additionally, we have the option to increase the Revolving Facility or the Term Loan Facility in an aggregate amount of up to $300.0 million, subject to certain conditions. Our outstanding debt as of December 31, 2017 under the Facilities was $470.0 million, which was comprised of $395.0 million outstanding under the Term Loan and $75.0 million outstanding under the Revolving Facility. Including outstanding letters of credit, the remaining availability under the Facilities was approximately $493.0 million as of December 31, 2017. In connection with the Credit Agreement, the Company capitalized $3.2 million of debt issuance costs, which are being amortized into interest expense, over the term of the Facilities. Total unamortized debt issuance costs of approximately $3.4 million were netted against debt as of December 31, 2017. Loans under the Facilities accrue interest at a per annum rate equal to, at the Company’s election, either a LIBOR rate plus a margin ranging from 75 to 200 basis points or a base rate (generally determined by a prime rate, federal funds rate or a LIBOR rate plus 1.00%) plus a margin ranging from 0 to 100 basis points. In each case, the actual margin is determined according to a ratio of the Company’s total indebtedness to earnings before interest, taxes, depreciation and amortization (“EBITDA“) for the then most recently ended four quarter period (the “Leverage Ratio”). The Previous Credit Facility accrued interest based on the LIBOR rate plus a margin ranging from 75 to 175 basis points. An unused commitment fee at a rate ranging from 15 to 30 basis points per annum, determined according to the Leverage Ratio, applies to the unutilized commitments under the Revolving Facility; the unused commitment fee under the Previous Credit Facility was 15 to 25 basis points. Loans outstanding under the Credit Agreement may be prepaid at any time without premium or penalty, subject to customary breakage costs in the case of borrowings for which a LIBOR rate election is in effect. Up to $35.0 million of the Revolving Facility may be advanced in certain agreed foreign currencies, including Euros, Pounds Sterling, Canadian Dollars, Japanese Yen, and Mexican Pesos. The Facilities mature on August 30, 2022. Quarterly amortization payments are required to be made on the Term Loan Facility in the amount of $5.0 million beginning in the fourth quarter of 2017. The obligations under the Credit Agreement are guaranteed by certain direct and indirect material subsidiaries of the Company. The Credit Agreement contains customary affirmative and negative covenants, including financial covenants requiring the maintenance of specified fixed charges and leverage ratios. At December 31, 2017, we were in compliance with these covenants. We attempt to minimize interest risk exposure by fixing our rate through the utilization of interest rate swaps, which are derivative financial instruments. Our swaps are entered into with financial institutions that participate in our Credit Agreement. By using a derivative instrument to hedge exposures to changes in interest rates, we expose ourselves to credit risk. Credit risk is due to the possible failure of the counterparty to perform under the terms of the derivative contract. As of December 31, 2017, we have the following interest rate swap agreements, including three forward starting swaps executed in 2015 that will become effective in 2018 upon expiration of the two existing swaps for $125 million. In addition, we executed four additional interest rate swaps in 2017 for $275 million, which became effective on January 30, 2018.
Effective Dates |  | Floating Rate Debt |  | Fixed Rates |
July 30, 2013 through April 30, 2018 |  | $ | 75 | million |  | 1.42 | %
December 30, 2014 through April 30, 2018 |  | $ | 50 | million |  | 1.36 | %
April 30, 2018 through April 30, 2023 |  | $ | 55 | million |  | 2.33 | %
April 30, 2018 through April 30, 2023 |  | $ | 35 | million |  | 2.36 | %
April 30, 2018 through April 30, 2023 |  | $ | 35 | million |  | 2.34 | %
January 30, 2018 through August 30, 2022 |  | $ | 100 | million |  | 1.99 | %
January 30, 2018 through August 30, 2022 |  | $ | 75 | million |  | 1.99 | %
January 30, 2018 through August 30, 2022 |  | $ | 75 | million |  | 2.00 | %
January 30, 2018 through August 30, 2022 |  | $ | 25 | million |  | 1.99 | %
The effective portion of the gain or loss on the swaps is recognized in other comprehensive income/(loss) and reclassified into earnings in the same period or periods during which the swaps affect earnings. Gains or losses on the swaps representing hedge components excluded from the assessment of effectiveness are recognized in current earnings. Amounts payable or receivable under the swaps are accounted for as adjustments to interest expense. The following table provides information on the location and amounts of our swaps in the accompanying consolidated financial statements (in thousands):
|  | Interest Rate Swap Derivatives |
|  | Fair Value |  | Fair Value |
|  | December 31, |  | December 25, |
Balance Sheet Location |  | 2017 |  | 2016 |
Other current and long-term assets |  | $ | 651 |  | $ | — |
Other current and long-term liabilities |  | $ | — |  | $ | 770 |
There were no derivatives that were not designated as hedging instruments. The effect of derivative instruments on the accompanying consolidated financial statements is as follows (in thousands):
|  |  |  | Location of Gain |  | Amount of Gain |  |
Derivatives - |  |  |  |  | or (Loss) |  | or (Loss) |  | Total Interest Expense
Cash Flow |  | Amount of Gain |  | Reclassified |  | Reclassified |  | on Consolidated
Hedging |  | or (Loss) Recognized |  | from AOCL into |  | from AOCL into |  | Statements of
Relationships |  | in AOCL on Derivative |  | Income |  | Income |  | Income
Interest rate swaps: |  |  |  |  |  |  |  |  |
2017 |  | $ | 891 |  |  | Interest expense |  | $ | (421) |  | $ | (11,283)
2016 |  | $ | 940 |  |  | Interest expense |  | $ | (1,161) |  | $ | (7,397)
2015 |  | $ | (1,163) |  |  | Interest expense |  | $ | (1,563) |  | $ | (5,676)
The weighted average interest rates on our debt, including the impact of the interest rate swap agreements, were 2.7%, 2.1% and 2.0% in fiscal 2017, 2016 and 2015, respectively. Interest paid, including payments made or received under the swaps, was $10.8 million in 2017, $7.1 million in 2016 and $5.3 million in 2015. As of December 31, 2017, the portion of the $651,000 interest rate swap asset that would be reclassified into earnings during the next 12 months as interest income approximates $281,000.

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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 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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