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Debt
 9 Months Ended
Jan. 27, 2024
Debt Disclosure [Abstract]  
Debt

Note 8. Debt

A summary of debt is shown below:

 

(in millions)

 

January 27, 2024

 

 

April 29, 2023

 

Revolving credit facility

 

$

332.6

 

 

$

305.4

 

Other debt

 

 

1.5

 

 

 

4.7

 

Unamortized debt issuance costs

 

 

(2.8

)

 

 

(3.3

)

Total debt

 

 

331.3

 

 

 

306.8

 

Less: current maturities

 

 

(0.2

)

 

 

(3.2

)

Total long-term debt

 

$

331.1

 

 

$

303.6

 

 

Revolving credit facility/term loan

On October 31, 2022, the Company entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”) among the Company, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and the Lenders and other parties named therein. The Credit Agreement amended and restated the Amended and Restated Credit Agreement, dated September 12, 2018 and as previously amended (the “Prior Credit Agreement”), among the Company, Bank of America, N.A., as Administrative Agent, Swing Line Lender, and L/C Issuer, Wells Fargo Bank, National Association, as L/C Issuer, and the Lenders and other parties named therein. Among other things, the Credit Agreement (i) increased the multicurrency revolving credit commitments under the Prior Credit Agreement to $750,000,000, (ii) refinanced in full and terminated the term loan facility under the Prior Credit Agreement, and (iii) made certain other changes to the covenants, terms, and conditions under the Prior Credit Agreement. In addition, the Credit Agreement permits the Company to increase the revolving commitments and/or add one or more tranches of term loans under the Credit Agreement from time to time by up to an amount equal to (i) $250,000,000 plus (ii) an additional amount so long as the leverage ratio would not exceed 3.00:1.00 on a pro forma basis, subject to, among other things, the receipt of additional commitments from existing and/or new lenders. The Credit Agreement matures on October 31, 2027.

As of January 27, 2024, the Company was not in compliance with the original consolidated leverage ratio covenant contained in the Credit Agreement for the quarter ended January 27, 2024. On March 6, 2024, the Company entered into a First Amendment to Second Amended and Restated Credit Agreement (the “Amendment”) among the Company, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, the other Lenders party thereto and other parties thereto. Among other things, the Amendment (i) amended the consolidated leverage ratio covenant for the quarter ended January 27, 2024 and each subsequent fiscal quarter through the quarter ending October 26, 2024, (ii) amended certain interest rate provisions and (iii) waived any default or event of default that may have occurred due to the non-compliance with the consolidated leverage ratio covenant for the quarter ended January 27, 2024 that was in effect prior to the Amendment. Following the effectiveness of the Amendment, the Company was in compliance with its consolidated leverage ratio covenant for the quarter ended January 27, 2024.

Loans denominated in US dollars under the Credit Agreement, as amended by the Amendment, bear interest at either (a) an adjusted base rate or (b) an adjusted term Secured Overnight Financing Rate (“SOFR”) rate or term SOFR daily floating rate (in each case, as determined in accordance with the provisions of the Credit Agreement, as amended by the Amendment) in each case plus an applicable rate (the “Applicable Rate”) ranging between 0.375% and 1.75%, in the case of adjusted base rate loans, and between 1.375% and 2.75%, in the case of adjusted term SOFR rate loans and term SOFR daily floating rate loans. Loans denominated in euros will bear interest at the Euro Interbank Offered Rate plus an Applicable Rate ranging between 1.375% and 2.75%. The Applicable Rate is set based on the Company’s consolidated leverage ratio.

As of January 27, 2024, the outstanding balance under the revolving credit facility included $298.6 million (€275.0 million) of euro-denominated borrowings. The Company has designated the euro-denominated borrowings as a net investment hedge of the foreign currency exposure of its investments in euro-denominated subsidiaries. Refer to Note 7, "Derivative Instruments and Hedging Activities" for further information.

The weighted-average interest rate on outstanding US dollar and euro-denominated borrowings under the Credit Agreement was approximately 7.4% and 5.9%, respectively, as of January 27, 2024. The Credit Agreement, as amended by the Amendment, contains customary representations and warranties, financial covenants, restrictive covenants and events of default. As of January 27, 2024, after giving effect to the Amendment, including the changes it made to the Company's consolidated leverage ratio covenant for the quarter ended January 27, 2024, the Company was in compliance with all the covenants in the Credit Agreement.

Although the Company currently anticipates, based on its current projections and analyses, that it will be in compliance with the financial covenants contained in the Credit Agreement, as amended by the Amendment, no assurance can be given that the Company will be and remain in compliance with such covenants in the future. Factors that could increase the Company’s risk of future non-compliance include those identified in Part I – Item 1A, “Risk Factors” of the Company's Annual Report on Form 10-K for the year ended April 29, 2023.

Other debt

One of the Company’s European subsidiaries has debt that consists of one note with a maturity in 2031. The weighted-average interest rate on this debt was approximately 1.8% at January 27, 2024 and $0.2 million of the debt was classified as short-term.