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Long-Term Debt
12 Months Ended
Dec. 29, 2018
Debt Disclosure [Abstract]  
Long-Term Debt

Note 7 – Long-Term Debt

Long-term debt consists of the following:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 29,

 

 

December 30,

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2018

 

 

2017

 

Senior secured revolving credit facility, due December 2023

$

 

600,852

 

 

$

 

707,492

 

Senior secured term loan, due December 2023

 

 

60,000

 

 

 

 

 

Capital lease obligations (Note 10)

 

 

39,558

 

 

 

 

42,904

 

Other, 2.61% - 8.75%, due 2019 - 2024

 

 

4,447

 

 

 

 

5,972

 

Total debt – Principal

 

 

704,857

 

 

 

 

756,368

 

Unamortized debt issuance costs

 

 

(6,797

)

 

 

 

(6,417

)

Total debt

 

 

698,060

 

 

 

 

749,951

 

Less current portion

 

 

18,263

 

 

 

 

9,196

 

Total long-term debt

$

 

679,797

 

 

$

 

740,755

 

On December 18, 2018, SpartanNash Company and certain of its subsidiaries entered into an amendment (the “Amendment”) to the Company’s Amended and Restated Loan and Security Agreement (the “Credit Agreement”). The principal changes of the amendment included an extension of the maturity date of the loans from December 20, 2021 to December 18, 2023, the ability to increase the size of the Tranche A revolving loan to $975 million from $900 million, an amendment to the interest rate grid such that rates for the Tranche A-1 revolving loans ($40 million capacity) are now LIBOR plus 2.25% to LIBOR plus 2.50%, a reload of the Tranche A-2 term loan ($60 million capacity) and a reset of certain advance rates for the borrowing base. The Company has the ability to increase the size of the Credit Agreement by an additional $325 million, subject to certain conditions in the Credit Agreement. The Company’s obligations under the related Credit Agreement are secured by substantially all of the Company’s personal and real property. The Company may repay all loans in whole or in part at any time without penalty.

Availability under the Credit Agreement is based upon advance rates on certain asset categories owned by the Company, including, but not limited to the following: inventory, accounts receivable, real estate, prescription lists, cigarette tax stamps, and rolling stock.

The Credit Agreement imposes certain requirements, including: limitations on dividends and investments, limitations on the Company’s ability to incur debt, make loans, acquire other companies, change the nature of the Company’s business, enter a merger or consolidation, or sell assets. These requirements can be more restrictive depending upon the Company’s Excess Availability, as defined under the Credit Agreement.

Borrowings under the three tranches of the credit facility bear interest at the Company’s option as either Eurodollar loans or Base Rate loans, subject to a grid based upon Excess Availability. The interest rate terms for each of the aforementioned tranches are as follows:

Credit

 

Outstanding as of

 

 

 

 

 

 

Facility

 

December 29, 2018

 

 

 

 

 

 

Tranche

 

(In thousands)

 

 

Eurodollar Rate

 

Base Rate

Tranche A

 

$

 

569,601

 

 

LIBOR plus 1.25% to 1.50%

 

Greater of:

(i) the Federal Funds Rate plus 0.75% to 1.00%

 

 

 

 

 

 

 

 

 

 

(ii) the Eurodollar Rate plus 2.25% to 2.50%

 

 

 

 

 

 

 

 

 

 

(iii) the prime rate plus 0.25% to 0.50%

Tranche A-1

 

$

 

31,251

 

 

LIBOR plus 2.25% to 2.50%

 

Greater of:

(i) the Federal Funds Rate plus 1.75% to 2.00%

 

 

 

 

 

 

 

 

 

 

(ii) the Eurodollar Rate plus 2.25% to 2.50%

 

 

 

 

 

 

 

 

 

 

(iii) the prime rate plus 1.25% to 1.50%

Tranche A-2

 

$

 

60,000

 

 

LIBOR plus 5.25%

 

Greater of:

(i) the Federal Funds Rate plus 4.75%

 

 

 

 

 

 

 

 

 

 

(ii) the Eurodollar Rate plus 5.25%

 

 

 

 

 

 

 

 

 

 

(iii) the prime rate plus 4.25%

The Company also incurs an unused line of credit fee on the unused portion of the loan commitments at a rate of 0.25%.

The Credit Agreement requires that the Company maintain Excess Availability of 10% of the borrowing base, as defined in the Credit Agreement. The Company is in compliance with all financial covenants as of December 29, 2018 and had Excess Availability after the 10% requirement of $262.0 million and $132.7 million at December 29, 2018 and December 30, 2017, respectively. The Credit Agreement provides for the issuance of letters of credit, of which $11.7 million and $9.2 million were outstanding as of December 29, 2018 and December 30, 2017, respectively.

The weighted average interest rate for all borrowings, including loan fee amortization, was 4.08% for 2018.

At December 29, 2018, aggregate annual maturities and scheduled payments of long-term debt are as follows:

(In thousands)

2019

 

 

2020

 

 

2021

 

 

2022

 

 

2023

 

 

Thereafter

 

 

Total

 

Total borrowings

$

 

18,263

 

 

$

 

16,569

 

 

$

 

13,911

 

 

$

 

13,341

 

 

$

 

623,559

 

 

$

 

19,214

 

 

$

 

704,857