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Derivative Instruments and Hedging Activities
 9 Months Ended
Sep. 28, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities Derivative Instruments and Hedging Activities
Cash Flow Hedges of Interest Rate Risk - In March 2024 and December 2023, OSI entered into 11 interest rate swap agreements with ten counterparties (the “Swap Transactions”) to manage its exposure to fluctuations in variable interest rates that include one- and two-year tenors. The remaining Swap Transactions have an aggregate notional amount of $275.0 million with the following terms:
NOTIONAL AMOUNTWEIGHTED AVERAGE FIXED INTEREST RATE (1)EFFECTIVE DATETERMINATION DATE
$100,000,000 4.34%December 29, 2023December 31, 2025
175,000,000 4.40%March 29, 2024March 31, 2026
$275,000,000 4.38%
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(1)The weighted average fixed interest rate excludes the term SOFR adjustment and interest rate spread described below.

In connection with the remaining Swap Transactions, the Company effectively converted $275.0 million of its outstanding indebtedness from SOFR, plus a term SOFR adjustment of 0.10% and a spread of 150 to 250 basis points, to the weighted average fixed interest rates within the table above, plus a term SOFR adjustment of 0.10% and a spread of 150 to 250 basis points. The Swap Transactions have an embedded floor of minus 0.10%.

The Swap Transactions have been designated and qualify as cash flow hedges, are recognized on the Company’s Consolidated Balance Sheets at fair value and are classified based on the instruments’ maturity dates. The Company estimates $0.6 million of interest expense will be reclassified from Accumulated Other Comprehensive Income (Loss) to Interest expense, net over the next 12 months related to the Swap Transactions.
The following table presents the fair value and classification of the Company’s swap agreements as of the periods indicated:
(dollars in thousands)CONSOLIDATED BALANCE SHEETS CLASSIFICATIONSEPTEMBER 28, 2025DECEMBER 29, 2024
Interest rate swaps - liabilityAccrued and other current liabilities$593 $579 
Interest rate swaps - liabilityOther long-term liabilities, net— 255 
Total fair value of derivative instruments - liabilities (1)$593 $834 
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(1)See Note 13 - Fair Value Measurements for fair value discussion of the interest rate swaps.

By utilizing the interest rate swaps, the Company is exposed to credit-related losses in the event that the counterparty fails to perform under the terms of the derivative contract. To mitigate this risk, the Company enters into derivative contracts with major financial institutions based upon credit ratings and other factors. The Company continually assesses the creditworthiness of its counterparties. As of September 28, 2025, all counterparties to the Swap Transactions performed in accordance with their contractual obligations.

The Swap Transactions contain provisions whereby the Company could be declared in default on its derivative obligations if the repayment of the underlying indebtedness is accelerated by the lender due to the Company’s default on indebtedness. If the Company had breached any of these provisions as of September 28, 2025 and December 29, 2024, it could have been required to settle its obligations under the Swap Transactions at their termination value of $0.6 million and $0.8 million, respectively. As of September 28, 2025 and December 29, 2024, the Company has not posted any collateral related to the Swap Transactions.
In October 2025, subsequent to the thirteen weeks ended September 28, 2025, OSI entered into eight interest rate swap agreements with eight counterparties (the “2025 Swap Transactions”) to manage its exposure to fluctuations in variable interest rates that include 12- and 21-month tenors. The 2025 Swap Transactions have an aggregate notional amount of $300.0 million with the following terms:

NOTIONAL AMOUNTWEIGHTED AVERAGE FIXED INTEREST RATE (1)EFFECTIVE DATETERMINATION DATE
$100,000,000 3.37%December 31, 2025December 31, 2026
200,000,000 3.18%March 31, 2026December 31, 2027
$300,000,000 3.24%
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(1)The weighted average fixed interest rate excludes the term SOFR adjustment and interest rate spread described below.

Upon the effective date, as a result of the 2025 Swap Transactions, the Company effectively converted $300.0 million of its outstanding indebtedness from SOFR, plus a term SOFR adjustment of 0.10% and a spread of 150 to 250 basis points, to the weighted average fixed interest rates within the table above, plus a term SOFR adjustment of 0.10% and a spread of 150 to 250 basis points. The 2025 Swap Transactions have an embedded floor of minus 0.10%.

The 2025 Swap Transactions have been designated and qualify as cash flow hedges, will be recognized on the Company’s Consolidated Balance Sheets at fair value and will be classified based on the instruments’ maturity dates.
Non-Designated Hedges

During the fourth quarter of 2024, the Company entered into foreign currency forward contracts to partially offset the foreign currency exchange gains and losses generated by the Brazilian Reais rate risk associated with the purchase price installment payments from the Brazil Sale Transaction. As of September 28, 2025, the Company had R$745.9 million Brazilian Reais (approximately $138.6 million U.S. Dollars) of outstanding notional amounts
related to its foreign currency forward contracts. The liability and asset related to the foreign exchange forward contracts as of September 28, 2025 and December 29, 2024, respectively, are not material as they typically mature monthly. As of September 28, 2025 and December 29, 2024, the Company has not posted any collateral related to the foreign currency forward contracts.
The following table summarizes the effects of the Company’s foreign exchange forward contracts on the Consolidated Statements of Operations and Comprehensive (Loss) Income for the periods indicated:
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME CLASSIFICATIONTHIRTEEN WEEKS ENDEDTHIRTY-NINE WEEKS ENDED
(dollars in thousands)SEPTEMBER 28, 2025SEPTEMBER 28, 2025
Loss on foreign currency forward contracts (1)General and administrative$6,853 $25,564 
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(1)The loss on foreign currency forward contracts, which includes costs in connection with the forward contracts, is partially offset within General and administrative expense by foreign currency exchange gains of $3.6 million and $17.8 million for the thirteen and thirty-nine weeks ended September 28, 2025, respectively, related to the installment receivable from the Brazil Sale Transaction.

The Company’s interest rate swaps and foreign currency forward contracts are subject to master netting arrangements. As of September 28, 2025, the Company elected not to offset derivative positions in its Consolidated Balance Sheet with the same counterparty under the same agreement.