DEBT |
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Jun. 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| DEBT | NOTE 6. DEBT Debt consisted of the following (in millions):
The weighted average effective interest rates on the Company’s outstanding borrowings as of June 30, 2026 and December 31, 2025 were 4.20% and 4.24%, respectively. Unsecured Revolving Credit Facility We have a $1.5 billion unsecured -year revolving credit facility (“Credit Agreement”). As of June 30, 2026, borrowings under the Credit Agreement bear interest at variable rates based on SOFR plus 1.00% or the bank prime rate, and we pay a commitment fee of 0.10% on the unused portion of the facility. Interest rates under the Credit Agreement are subject to quarterly adjustment based on our total net leverage ratio (as defined in the Credit Agreement). Weighted average interest rates on borrowings outstanding under the revolving credit facility were 4.71% and 5.29% as of June 30, 2026 and December 31, 2025, respectively. As of June 30, 2026, no letters of credit were outstanding compared to $0.7 million outstanding as of December 31, 2025. Unsecured Term Loan As of June 30, 2026, the $400 million outstanding under the Company’s unsecured term loan (the “Term Loan”) bore interest at SOFR plus 0.75%. Interest rates under the Term Loan are subject to quarterly adjustment based on our total net leverage ratio that is defined similarly as in our Credit Agreement. The interest rates on the outstanding balance of the term loan were 4.39% and 4.49% as of June 30, 2026 and December 31, 2025, respectively. Senior Unsecured Notes Under the indentures for each series of our senior notes (the “indentures”), the notes are senior unsecured obligations and rank equally in right of payment with all of our existing and future unsecured and unsubordinated obligations. If we experience a change in control accompanied by a downgrade in our credit rating, we will be required to make an offer to repurchase each series of notes at a price equal to 101% of their principal amount plus accrued and unpaid interest. Letters of Credit/Letters of Guarantee Facility We have a $50.0 million standby letters of credit/letters of guarantee agreement with one of the lenders under our Credit Agreement. We had $31.4 million and $31.7 million outstanding under this facility as of June 30, 2026 and December 31, 2025, respectively. Covenants The Credit Agreement, Term Loan and indentures governing our debt securities include customary representations, warranties, covenants and events of default provisions. The covenants under the Credit Agreement and Term Loan include, among other things, a financial maintenance covenant that requires us to comply with a maximum total net leverage ratio. We were in compliance with the financial maintenance covenant under our Credit Agreement and Term Loan as of June 30, 2026. |
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