Debt

9 Months Ended

Sep. 30, 2019

Note 9. Debt

Debt

The following table summarizes the Company's total debt (in millions, except percentages):



	As of September 30, 2019
	Issuance date	Maturity Date	Amount			Effective Interest Rates
Senior Notes ("Notes"):
4.500% fixed-rate notes⁽¹⁾("2024 Notes")	March 2014	March 2024	$	350.0		4.63	%
4.500% fixed-rate notes⁽¹⁾("2024 Notes")	February 2016	March 2024	150.0			4.87	%
4.350% fixed-rate notes ("2025 Notes")	March 2015	June 2025	300.0			4.47	%
3.750% fixed-rate notes ("2029 Notes")	August 2019	August 2029	500.0			3.86	%
5.950% fixed-rate notes ("2041 Notes")	March 2011	March 2041	400.0			6.03	%
Total Notes			1,700.0
Unaccreted discount and debt issuance costs			(13.5		)
Hedge accounting fair value adjustments⁽²⁾			1.1
Total			$	1,687.6

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⁽¹⁾	2024 Notes issued in March 2014 and February 2016 form a single series and are fully fungible.


⁽²⁾	Represents the fair value adjustments for interest rate swap contracts with an aggregate notional amount of $300.0 million designated as fair value hedges of our fixed-rate 2041 Notes. See Note 6, Derivative Instruments, for a discussion of the Company's interest rate swaps.

In August 2019, the Company issued $500.0 million aggregate principal amount of 3.75% senior notes due 2029. The net proceeds from the issuance of the 2029 Notes, together with cash on hand, were used for the repayment of $600.0 million aggregate principal amount of the Company's 3.30% senior notes due 2020 and 4.60% senior notes due 2021. The repayments were made in August and September 2019. The repayments resulted in a loss on extinguishment of debt of $15.3 million, which was recorded under other expense, net within the Condensed Consolidated Statements of Operations.

The Notes above are the Company’s senior unsecured and unsubordinated obligations, ranking equally in right of payment to all of the Company’s existing and future senior unsecured and unsubordinated indebtedness, and senior in right of payment to any of the Company’s future indebtedness that is expressly subordinated to the Notes.

The Company may redeem the 2025 Notes and the 2029 Notes, either in whole or in part, at any time three months prior to the maturity date of the 2025 Notes, and three months prior to the maturity date of the 2029 Notes, respectively, at a redemption price equal to the greater of (i) 100% of the aggregate principal amount of the 2025 Notes and the 2029 Notes to be redeemed or (ii) the sum of the present values of the remaining scheduled payments discounted at the Treasury rate plus 37.5 basis points for the 2025 Notes, or the Treasury rate plus 35.0 basis points for the 2029 Notes, plus, in the case of each of the clauses (i) and (ii) above, accrued and unpaid interest, if any. At any time on or after March 15, 2025, in the case of the 2025 Notes, and at any time on or after March 15, 2029, in the case of the 2029 Notes, the Company may redeem Notes of such series, in whole or in part, at a redemption price equal to 100% of the principal amount of the 2025 Notes and the 2029 Notes to be redeemed, plus accrued and unpaid interest, if any. The Company may redeem the other Notes, either in whole or in part, at any time at a redemption price equal to the greater of (i) 100% of the aggregate principal amount of the Notes to be redeemed or (ii) the sum of the present values of the remaining scheduled payments discounted to the redemption date, plus, in either case, accrued and unpaid interest, if any.

In the event of a change of control repurchase event, the holders of the Notes may require the Company to repurchase for cash all or part of the Notes at a purchase price equal to 101% of the aggregate principal amount, plus accrued and unpaid interest, if any.

Interest on the Notes is payable in cash semiannually. The effective interest rates for the Notes include the interest on the Notes, accretion of the discount, and amortization of issuance costs. The indentures that govern the Notes also contain various covenants, including limitations on the Company's ability to incur liens or enter into sale-leaseback transactions over certain dollar thresholds.

As of September 30, 2019, the Company was in compliance with all covenants in the indentures governing the Notes.

Revolving Credit Facility

In April 2019, the Company entered into a new credit agreement with certain institutional lenders that provides for a five-year $500.0 million unsecured revolving credit facility (the "Revolving Credit Facility"), with an option to increase the Revolving Credit Facility by up to an additional $200.0 million, subject to the lenders' approval. Proceeds of loans made under the Revolving Credit Facility may be used by the Company for working capital and general corporate purposes. The Revolving Credit Facility will terminate in April 2024, subject to two one-year maturity extension options, on the terms and conditions as set forth in the credit agreement. As of September 30, 2019, there were no amounts outstanding under the Revolving Credit Facility.

Borrowings under the Revolving Credit Facility will bear interest, at either (i) a floating rate per annum equal to the base rate plus a margin of between 0.00% and 0.375%, depending on the Company's public debt rating or (ii) a per annum rate equal to the reserve adjusted Eurocurrency rate, plus a margin of between 0.910% and 1.375%, depending on the Company's public debt rating. Base rate is defined as the greatest of (A) Citibank's base rate, (B) the federal funds rate plus 0.500% or (C) the ICE Benchmark Administration Settlement Rate applicable to dollars for a period of one month plus 1.00%. The Eurocurrency rate is determined for U.S. dollars and Pounds Sterling as the rate at which deposits in such currency are offered in the London interbank market for the applicable interest period and for Euro as the rate specified for deposits in Euro with a maturity comparable to the applicable interest period.

The Revolving Credit Facility requires the Company to maintain a leverage ratio no greater than 3.0x (provided that if a material acquisition has been consummated, the Company is permitted to maintain a leverage ratio no greater than 3.5x for up to four quarters) and an interest coverage ratio no less than 3.0x during the term of the credit facility. As of September 30, 2019, the Company was in compliance with all covenants in the Credit Agreement.