Quantitative and Qualitative Disclosures About Market Risk
−Removed: There have been no material changes in our quantitative and qualitative market risks since August 2, 2019.
+Added: There have been no material changes in our quantitative and qualitative market risks since August 2, 2019, except as described below.
For a discussion of the Company’s exposure to market risk, refer to the Company’s market risk disclosures set forth in Part II, Item 7A.
“Quantitative and Qualitative Disclosures About Market Risk” of the 2019 Form 10-K.
+Added: Interest Rate Risk.
+Added: We have interest rate risk relative to our outstanding borrowings under our revolving credit facility.
+Added: At May 1, 2020, the Company had outstanding borrowings of $940,000 (see Note 6 to the Condensed Consolidated Financial Statements).
+Added: During the third quarter of 2020, as a precautionary measure to provide financial flexibility given the uncertainty in the market caused by the COVID-19 pandemic, the Company borrowed the remaining available amount under the Company’s revolving credit facility.
+Added: Borrowings under the Company’s credit facility bear interest, at the Company’s election, either at the prime rate or LIBOR plus a percentage point spread based on certain specified financial ratios.
+Added: The Company’s policy has been to manage interest cost using a mix of fixed and variable rate debt (see Notes 6 and 7 to the Condensed Consolidated Financial Statements).
+Added: To manage this risk in a cost efficient manner, we have entered into interest rate swaps.
+Added: At May 1, 2020, $400,000 of the Company’s outstanding borrowings were swapped at a weighted average interest rate of 3.61% (see Note 7 to the Condensed Consolidated Financial Statements for information on the Company’s interest rate swaps).
+Added: At May 1, 2020, the weighted average interest rate on the remaining $540,000 of the Company’s outstanding borrowings was 2.22%.
+Added: The impact of a one-percentage point increase or decrease on the remaining $540,000 of our outstanding borrowings is approximately $5,460 on a pre-tax annualized basis.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.