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Debt | 9 Months Ended
--- | ---
Oct. 30, 2020
Debt Disclosure [Abstract] |
Debt | NOTE 5. DEBT On September 9, 2020, the Company entered into the Term Loan Credit Agreement and the Second Amendment to the ABL Facility, entered into on August 12, 2020, became effective. The Company's debt consisted of the following:
|  | October 30, 2020 |  |  | November 1, 2019 |  |  | January 31, 2020 |
(in thousands) |  | Amount |  |  | Rate |  |  | Amount |  |  | Rate |  |  | Amount |  |  | Rate |
Term Loan Facility, maturing April 4, 2021* |  | $ | — |  |  | —% |  |  | $ | 386,675 |  |  |  | 5.29 | % |  | $ | 385,388 |  |  |  | 5.05 | %
Term Loan Credit Agreement, maturing September 9, 2025 |  |  | 275,000 |  |  |  | 10.75 | % |  |  | — |  |  | —% |  |  |  | — |  |  | —% |
ABL Facility, maturing November 16, 2022 |  |  | 155,000 |  |  |  | 2.27 | % |  |  | 80,000 |  |  |  | 3.54 | % |  |  | — |  |  | —% |
|  |  | 430,000 |  |  |  |  |  |  |  | 466,675 |  |  |  |  |  |  |  | 385,388 |  |  |  |  |
Less: Current borrowings and short-term portion of long-term debt |  |  | 13,750 |  |  |  |  |  |  |  | 85,150 |  |  |  |  |  |  |  | 5,150 |  |  |  |  |
Less: Unamortized debt issuance costs |  |  | 12,550 |  |  |  |  |  |  |  | 1,919 |  |  |  |  |  |  |  | 1,581 |  |  |  |  |
Long-term debt, net |  | $ | 403,700 |  |  |  |  |  |  | $ | 379,606 |  |  |  |  |  |  | $ | 378,657 |  |  |  |  |
*The Term Loan Facility was refinanced on September 9, 2020 with the Term Loan Credit Agreement and $125.0 million of borrowings from the ABL Facility.
The following table summarizes the Company's borrowing availability under the ABL Facility:
(in thousands) |  | October 30, 2020 |  |  | November 1, 2019 |  |  | January 31, 2020 |
ABL Facility maximum borrowing |  | $ | 275,000 |  |  | $ | 175,000 |  |  | $ | 175,000 |
Less: Outstanding borrowings |  |  | 155,000 |  |  |  | 80,000 |  |  |  | — |
Less: Outstanding letters of credit |  |  | 15,265 |  |  |  | 12,531 |  |  |  | 23,299 |
Borrowing availability under ABL Facility |  | $ | 104,735 |  |  | $ | 82,469 |  |  | $ | 151,701 |
Maturity; Amortization and Prepayments The Term Loan Credit Agreement matures on September 9, 2025 and amortizes at a rate equal to 1.25% per quarter. Additionally the Term Loan Credit Agreement is subject to mandatory prepayments in an amount equal to a percentage of the borrower’s excess cash flows in each fiscal year, ranging from 0% to 75% depending on the Company’s total leverage ratio, and with the proceeds of certain asset sales, casualty events and extraordinary receipts. The loan may not be voluntarily prepaid during the first two years of its term. A prepayment premium is applicable to voluntary prepayments and certain mandatory prepayments made prior to the fourth anniversary of the closing date of the Term Loan Credit Agreement. The ABL Facility matures on November 16, 2022. Guarantees; Security Pursuant to a Term Loan Guaranty and Security Agreement, dated September 9, 2020, all obligations under the Term Loan Credit Agreement are unconditionally guaranteed by Lands’ End, Inc. and subject to certain exceptions, each of its existing and future direct and indirect subsidiaries. The Term Loan Credit Agreement is secured by a first priority security interest in certain property and assets of the borrowers and guarantors, including certain fixed assets such as real estate, stock of the subsidiaries and intellectual property, in each case, subject to certain exceptions. The Term Loan Credit Agreement is also secured by a second priority security interest in certain working capital of the borrowers and guarantors consisting primarily of accounts receivable and inventory, with certain exceptions. The ABL Facility is secured by a first priority security interest in certain working capital of the borrowers and guarantors consisting primarily of accounts receivable and inventory. Interest; Fees The interest rates per annum applicable to the loans under the Term Loan Credit Agreement are based on a fluctuating rate of interest measured by reference to, at the borrower’s election, either (1) an adjusted LIBOR (with a minimum rate of 1%) plus 9.75%, or (2) an alternative base rate (which is the greater of (i) the prime rate published in the Wall Street Journal, (ii) the federal funds rate, which shall be no lower than 0%, plus ½ of 1%, and (iii) the one month LIBOR rate plus 1% per annum) plus 8.75%. An upfront fee equal to 3.00% of the principal amount of the Term Loan Credit Agreement was paid upon funding of the Term Loan Credit Agreement. Customary agency fees are payable annually. Additionally, upon entering into the Term Loan Credit Agreement, the Company incurred $4.7 million in debt origination fees. The borrowing margin under the ABL Facility is subject to adjustment based on the average daily total loans outstanding under the ABL Facility for the preceding fiscal quarter. For LIBOR loans, the interest rate is LIBOR (subject to an interest rate floor of 0.75%) plus a borrowing margin which is, where the average daily total loans outstanding for the previous quarter are (i) less than $50.0 million, 1.75%, (ii) equal to or greater than $50.0 million but less than $100.0 million, 2.00%, (iii) equal to or greater than $100.0 million but less than $200.0 million, 2.25%, and (iv) greater than $200.0 million, 3.50%. For base rate loans, the borrowing margin is, where the average daily total loans outstanding for the previous quarter are (i) less than $50.0 million for the previous quarter, 1.00%, (ii) equal to or greater than $50.0 million but less than $100.0 million, 1.25%, (iii) equal to or greater than $100.0 million but less than $200.0 million, 1.50%, and (iv) greater than $200.0 million, 2.75%. Additionally, if average daily total loans outstanding for the previous quarter under the ABL Facility are (i) less than 50% of the lesser of (a) the aggregate commitments and (b) the borrowing base (the “Loan Cap”), the commitment fee percentage will equal 0.375% and (ii) equal to or greater than 50% of the Loan Cap, the commitment fee percentage will equal 0.25%. The commitment fee is computed as the applicable percentage multiplied by the actual daily amount by which the aggregate commitments exceed the total outstanding loans and letter of credit obligations in the preceding quarter. Representations and Warranties; Covenants The Term Loan Credit Agreement contains various representations and warranties, and restrictive covenants that, among other things, and subject to specified exceptions, restricts the ability of Lands’ End and its subsidiaries to incur indebtedness (including guarantees), grant liens, make investments, make dividends or distributions with respect to capital stock, make prepayments on other indebtedness, engage in mergers or change the nature of their business. The Term Loan Credit Agreement is subject to certain financial covenants, including a quarterly maximum total leverage ratio test, a weekly minimum liquidity test and an annual maximum capital expenditure amount. The Term Loan Credit Agreement contains certain affirmative covenants, including reporting requirements such as delivery of financial statements, certificates and notices of certain events, maintaining insurance, and providing additional guarantees and collateral in certain circumstances. Additionally, the ABL Facility has a cash maintenance provision, which applies a limit of $75.0 million on the amount of cash and cash equivalents (subject to certain exceptions) that the Company may hold when outstanding loans under the ABL Facility are equal to or exceed $125.0 million. The Company was in compliance with all operating and financial covenants related to the Term Loan Credit Agreement and the ABL Facility as of October 30, 2020. Events of Default The Term Loan Credit Agreement and ABL Facility include customary events of default including non-payment of principal, interest or fees, violation of covenants, inaccuracy of representations or warranties, cross defaults to certain other material indebtedness, bankruptcy and insolvency events, invalidity or impairment of guarantees or security interests, and material judgments and change of control.

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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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