Debt

12 Months Ended

Dec. 31, 2024

Debt Disclosure [Abstract]

Debt

NOTE 9. DEBT

Long-term Debt consists of the following at December 31:

(in thousands)	2024			2023
Variable-rate term loans1	$	937,000		$	761,000
Fixed-rate term loans2		100,000			210,000
Revenue bonds3		—			65,735
Long-term principal		1,037,000			1,036,735
Debt issuance costs		(1,917	)		(1,926	)
Unamortized discounts		(431	)		(1,081	)
Total long-term debt		1,034,652			1,033,728
Less: current portion of long-term debt		(99,552	)		(175,615	)
Long-term debt	$	935,100		$	858,113

1.	Variable-rate term loans are at rates of one-month SOFR plus a spread between 1.61% and 2.30%, or daily simple SOFR plus a spread between 2.20% and 2.30%. The variable-rate term loans mature between 2026 and 2034. As of December 31, 2024, the one-month SOFR rate was 4.55% and the daily simple SOFR rate was 4.64%. We have entered into interest rate swaps to fix the interest rate on these variable-rate term loans. See Note 10: Derivative Instruments for additional information.
2.	At December 31, 2024, we have one fixed-rate term loan at a rate of 4.05% which matures in August 2025. See discussion below regarding a $110.0 million fixed rate term loan that was refinanced upon maturity on November 1, 2024.
3.	The revenue bonds had a fixed rate of 2.75% and were repaid upon maturity in October 2024.

TERM LOANS

At December 31, 2024, approximately $1.0 billion was outstanding under our Second Amended and Restated Term Loan Agreement (Amended Term Loan Agreement) with our primary lender.

On November 1, 2024, we entered into a tenth amendment to the Amended Term Loan Agreement, which provided for a new 8-year term loan of $38.0 million maturing on November 1, 2032, a new 9-year term loan of $38.0 million maturing on November 1, 2033, and a new 10-year term loan of $100.0 million maturing on November 1, 2034 (collectively, the New Term Loans). The proceeds of the New Term Loans were used to refinance a $110.0 million term loan under the Amended Term Loan agreement that matured on November 1, 2024, and to replenish cash used to repay a $65.7 million revenue bond that matured in October 2024.

The New Term Loans bear interest at a rate equal to daily simple SOFR plus an applicable margin ranging between 2.20% and 2.30% per annum depending on their respective maturity date. The New Term Loans provide for a cost-of-capital reset at year five whereby the applicable margin may be reset at the sole discretion of the lender. In connection with the New Term Loans, we terminated $125.0 million of our forward-starting interest rate swaps and transferred the value realized from their termination into three new daily simple SOFR-indexed interest rate swaps to fix the interest rates associated with the New Term Loans between 4.02% and 4.28%, before patronage credits from lenders, depending on the maturity date of the associated term loan.

In December 2023, through a ninth amendment to the Amended Term Loan Agreement, we refinanced an existing term loan of $40.0 million that matured with a new term loan that matures in December 2033. The new term loan carries a variable interest rate of one-month SOFR plus 2.30%. In conjunction with the new term loan, we terminated a $50.0 million forward-starting interest rate swap and transferred the value realized from its termination into a new $40.0 million interest rate swap to fix the rate at 3.35% before patronage credits from lenders.

See Note 10: Derivative Instruments for additional information on our derivative instruments.

DEBT ISSUANCE COSTS AND UNAMORTIZED DISCOUNTS

Debt issuance costs represent the capitalized direct costs incurred related to the issuance of debt. These costs are amortized to interest expense over the terms of the respective borrowings.

Unamortized discounts include a $4.9 million fair value adjustment to a $100.0 million term loan assumed in the Deltic merger. The unamortized balance of the fair value adjustment at December 31, 2024 was $0.4 million and will be amortized through the term loan’s maturity in 2025.

DEBT MATURITIES

Scheduled principal payments due on long-term debt at December 31, 2024 are as follows:

(in thousands)
2025	$	100,000
2026		27,500
2027		138,750
2028		100,000
2029		190,000
Thereafter		480,750
Total	$	1,037,000

CREDIT AGREEMENT

On May 18, 2023, we entered into a first amendment to the Third Amended and Restated Credit Agreement (Amended Credit Agreement). The Amended Credit Agreement provides for loans based on SOFR instead of the London Inter-Bank Offered Rate (LIBOR), provides us the option to borrow based on a daily SOFR or term SOFR basis, and provides mechanics relating to the transition from the use of SOFR to a replacement benchmark rate upon the occurrence of certain transition events.

The Amended Credit Agreement provides for a $300.0 million revolving line of credit that matures February 14, 2027. As provided in the Amended Credit Agreement, the borrowing capacity may be increased up to an additional $500.0 million. The Amended Credit Agreement also includes a sublimit of $75.0 million for the issuance of standby letters of credit and a sublimit of $25.0 million for swing line loans. Usage under either or both sub facilities reduces availability under the revolving line of credit. We may also utilize borrowings under the Amended Credit Agreement to, among other things, refinance existing indebtedness and provide funding for working capital requirements, capital projects, acquisitions and other general corporate expenditures.

Pricing on the Amended Credit Agreement is set according to the type of borrowing. SOFR borrowings under the Amended Credit Agreement are issued at a rate equal to the Adjusted Daily Simple SOFR rate (as defined in the Amended Credit Agreement) plus an applicable rate. Base Rate borrowings are issued at a rate equal to a Base Rate, which is a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus one half of one percent, (b) the Adjusted Term SOFR for a one-month tenor in effect on such day, plus 1%, and (c) the rate of interest in effect for such day as publicly announced from time to time by KeyBank as its "prime rate." The interest rates we pay for borrowings under either type of loan include an additional Applicable Rate, which can range from 0.85% to 1.10% for SOFR loans and actual rate for Base Rate loans can range from 0% to 0.10% depending on our credit rating. Additionally, the Amended Credit Agreement provides mechanics relating to the transition from the use of SOFR to a replacement benchmark rate upon the occurrence of certain transition events or elections made by the parties. As of December 31, 2024, we were able to borrow under the revolving line of credit with an additional Applicable Rate of 1.025% for SOFR loans and 0.025% for Base Rate loans. We also pay an annual facility fee of 0.175% on the $300.0 million on our revolving line of credit. At December 31, 2024, there were no borrowings under the revolving line of credit and approximately $0.6 million of the revolving line of credit was utilized by outstanding letters of credit.

FINANCIAL COVENANTS

The Amended Term Loan Agreement and the Amended Credit Agreement (collectively referred to as the Agreements) contain certain covenants that limit our ability and that of our subsidiaries to create liens, merge or consolidate, dispose of assets, incur indebtedness and guarantees, repurchase or redeem capital stock and indebtedness, make certain investments or acquisitions, enter into certain transactions with affiliates or change the nature of our business. The Agreements also contain financial maintenance covenants including the maintenance of a minimum interest coverage ratio and a maximum leverage ratio. We are permitted to pay dividends to our stockholders under the terms of the Agreements so long as we expect to remain in compliance with the financial maintenance covenants. We were in compliance with all debt and credit agreement covenants at December 31, 2024.