Long-Term Debt (Tables)

6 Months Ended

Jul. 01, 2023

The following table sets forth the components of long-term debt:


			Successor
			July 1, 2023								December 31, 2022
	Effective Interest Rate		Principal Outstanding		Unamortized Fair Value Adjustment (1)		Unamortized Discount and Issuance Costs		Carrying Amount		Principal Outstanding		Unamortized Fair Value Adjustment(1)		Unamortized Discount and Issuance Costs		Carrying Amount
Term loan facility, due April 2028	8.57	%	$	2,541,500	$	(321,325)	$	—	$	2,220,175	$	2,554,500	$	(348,769)	$	—	$	2,205,731
Term loan facility, due August 2028	9.69	%	298,500		—		(19,998)		278,502		300,000		—		(21,538)		278,462
6.125% Senior Notes, due January 2029	13.51	%	318,699		(92,805)		—		225,894		365,541		(111,524)		—		254,017
8.750% Senior Secured Notes, due August 2028	10.61	%	710,000		—		(48,806)		661,194		710,000		—		(52,622)		657,378
Total long-term debt			$	3,868,699	$	(414,130)	$	(68,804)	$	3,385,765	$	3,930,041	$	(460,293)	$	(74,160)	$	3,395,588
Reflected as:
Current liabilities - Current portion of long-term debt									$	29,000							$	29,000
Non-current liabilities - Long-term debt									3,356,765								3,366,588
Total long-term debt									$	3,385,765							$	3,395,588
Fair value - Senior notes - Level 1									$	928,941							$	907,993
Fair value - Term loans - Level 2									2,739,854								2,580,000
Total fair value									$	3,668,795							$	3,487,993

(1) On July 25, 2022, as a result of the pushdown accounting related to the Merger, the carrying values of the term loan facility due April 2028 and the 6.125% Senior Notes (as defined below) were adjusted to fair value.

Schedule of Availability Under Credit Facilities

The following table sets forth the Company’s availability under its credit facilities:


	Successor
	July 1, 2023						December 31, 2022
	Available		Borrowings		Letters of Credit and Priority Payables		Available		Borrowings		Letters of Credit and Priority Payables
Asset-based lending facility	$	850,000	$	—	$	47,000	$	850,000	$	—	$	48,000
Cash flow revolver (1)	92,000		—		—		115,000		—		—
First-in-last-out tranche asset-based lending facility	95,000		—		—		95,000		—		—
Total	$	1,037,000	$	—	$	47,000	$	1,060,000	$	—	$	48,000

(1) Cash flow revolver commitments of $23.0 million matured in April 2023 and $92.0 million will mature in April 2026.

Schedule of Interest Rate Swap Agreement

The following table sets forth the terms of the Company’s interest rate swap agreements:


	May 2019 Swap (1)			April 2021 Swaps
Notional amount	$	500,000		$	1,000,000
Forecasted term loan interest payments being hedged	1-month SOFR			1-month SOFR
SOFR floor (per annum - matches floor in hedged item)	0.00		%	0.40		%
Fixed rate paid on $500,000 and $1,500,000 notional amounts	2.1680		%	2.0038		%
Fixed rate received on $(500,000) notional amount	n/a			(2.1680)		%
Origination date (3)	July 12, 2019			April 17, 2023
Maturity - Fixed rate paid	July 12, 2023			April 15, 2026
Maturity - Fixed rate received	n/a			July 12, 2023
Fair value at July 1, 2023:
Other current assets	$	465		$	—
Other assets, net	$	—		$	94,552
Other current liabilities	$	—		$	465
Fair value at December 31, 2022:
Other current assets	$	7,000		$	—
Other assets, net	$	—		$	95,361
Other current liabilities	$	—		$	7,000
Level in fair value hierarchy (2)	Level 2			Level 2

(1)The May 2019 swap was de-designated from cash flow hedge accounting in April 2021.

(2)Interest rate swaps are based on cash flow hedge contracts that have fixed rate structures and are measured against market based SOFR yield curves. These interest rate swaps are classified within Level 2 of the fair value hierarchy because they are valued using alternative pricing sources or models that utilized market observable inputs, including current and forward interest rates.

(3)During the three months ended July 1, 2023, and in conjunction with the transition from LIBOR to SOFR, the origination date of the April 2021 Swaps was amended to April 17, 2023.

Cornerstone Building Brands, Inc. 10-Q