Debt

9 Months Ended

Sep. 30, 2011

6. DEBT

Debt consisted of the following (dollars in thousands):


	September 30,		December 31,
	2011		2010

Bank credit facility	$	1,497,000	$	1,365,000
8¹/2% senior notes due 2015		500,000		500,000

		1,997,000		1,865,000
Less: current portion		14,000		14,000

Total long-term debt	$	1,983,000	$	1,851,000

Bank Credit Facility

As of September 30, 2011, we maintained a $1.785 billion bank credit facility (the “credit facility”), comprising:

•

$430.3 million of revolving credit commitments, which expire on December 31, 2012;

•

$762.0 million of outstanding Term Loan D borrowings, which mature on January 31, 2015; and

•

$592.5 million of outstanding Term Loan F borrowings, which mature on October 23, 2017.

As of September 30, 2011, we had $278.2 million of unused revolving credit commitments, all of which were able to be borrowed and used for general corporate purposes, after giving effect to $142.5 million of outstanding loans and $9.6 million of letters of credit issued to various parties as collateral.

The credit facility is collateralized by our ownership interests in our operating subsidiaries, and is guaranteed by us on a limited recourse basis to the extent of such ownership interests. As of September 30, 2011, the credit agreement governing the credit facility required us to maintain a total leverage ratio (as defined) of no more than 6.0 to 1.0. For all periods through September 30, 2011, we were in compliance with all of the covenants under the credit agreement, and as of September 30, 2011, our total leverage ratio was 4.3 to 1.0.

See Note 12 for a discussion of the financing transactions completed on November 10, 2011.

Interest Rate Exchange Agreements

We use interest rate exchange agreements (which we refer to as “interest rate swaps”) with various banks to fix the variable portion of borrowings under the credit facility. We believe this reduces the potential volatility in our interest expense that would otherwise result from changes in market interest rates. Our interest rate swaps have not been designated as hedges for accounting purposes, and have been accounted for on a mark-to-market basis as of, and for, the three and nine months ended September 30, 2011, and 2010. As of September 30, 2011:

•

We had current interest rate swaps which fix the variable portion of $700 million of borrowings under the credit facility at a rate of 3.2%. Our current interest rate swaps are scheduled to expire in the amounts of $100 million and $600 million during the years ending December 31, 2011 and 2012, respectively; and

•

We had forward-starting interest rate swaps which will fix the variable portion of $1.1 billion of borrowings under the credit facility at a rate of 3.1%. Our forward-starting interest rate swaps are scheduled to commence in the amounts of $100 million, $700 million and $300 million during the years ending December 31, 2011, 2012 and 2014, respectively.

As of September 30, 2011, the average interest rate on outstanding borrowings under the credit facility, including the effect of our interest rate swaps, was 4.3%, as compared to 4.7% as of the same date last year.

Senior Notes

As of September 30, 2011, we had $500 million of senior notes outstanding. Our senior notes are unsecured obligations and the indenture governing our senior notes had a limitation on the incurrence of additional indebtedness based upon a maximum debt to operating cash flow ratio (as defined) of 8.5 to 1.0. As of September 30, 2011, we were in compliance with all of the covenants under the indenture, and our debt to operating cash flow ratio was 6.0 to 1.0.

Debt Ratings

Our corporate credit ratings are B1, with a stable outlook, by Moody’s, and B+, with a stable outlook, by Standard and Poor’s. Any future downgrade to our credit ratings could result in higher interest rates on future debt issuance than we currently experience, or adversely impact our ability to raise additional funds. However, there are no covenants, events of default, borrowing conditions or other terms in our credit agreement or indenture that are based on changes in our credit rating assigned by any rating agency.

Fair Value

As of September 30, 2011, the fair values of our senior notes and outstanding debt under our credit facility are as follows (dollars in thousands):


8¹/2% senior notes due 2015	$	504,375


Bank credit facility	$	1,422,923