LONG-TERM DEBT AND LINES OF CREDIT

12 Months Ended

Dec. 31, 2025

The Company had the following outstanding amounts of long-term debt (In millions):


	December 31, 2025	December 31, 2024
Long-term debt and lines of credit:
Asset based revolving credit facility, bearing interest at a rate of 4.86%, secured by equipment and other current assets .................................................	$1,196	$465
Senior Secured Second Lien Notes bearing interest at a rate of 9.00% ................	1,034	1,034
Senior Secured Second Lien Notes bearing interest at a rate of 8.625% ..............	600	600
Senior Secured Second Lien Notes bearing interest at a rate of 8.00% ................	500	500
Notes payable to various institutions, bearing interest at rates ranging from 3.75% to 5.10%, maturing through 2029, secured by specific equipment .......	2	18
Equipment financing lines of credit with various institutions, bearing interest at rates ranging from 5.30% to 12.63%, maturing through 2025 ........................	3	9
Total long-term debt and lines of credit ....................................................................	3,335	2,626
Less: original issue discounts ....................................................................................	(22)	(31)
Less: debt issuance costs ...........................................................................................	(41)	(48)
	3,272	2,547
Less: current maturities .............................................................................................	(4)	(19)
Long-term debt and lines of credit, net of current portion, original issue discounts, and debt issuance costs ..........................................................................................	$3,268	$2,528

The maturities of long-term debt and lines of credit as of December 31, are as follows (In millions):


2026 ......................................................................................................................................................	$4
2027 ......................................................................................................................................................	–
2028 ......................................................................................................................................................	1,035
2029 ......................................................................................................................................................	–
2030 ......................................................................................................................................................	1,196
Thereafter ..............................................................................................................................................	1,100
Total ......................................................................................................................................................	$3,335

ABL Facility

During 2021, the Company entered into an asset-based lending facility (“ABL Facility”).

On May 9, 2023, the ABL Facility was amended and restated, and among other things, (i) extended the maturity

date of the ABL Facility to May 9, 2028, (ii) increased the maximum borrowing capacity from $2 billion to $3

billion, subject to certain availability requirements, covenants, and restrictions, (iii) lowered the Secured Overnight

Financing Rate (“SOFR”) applicable margin rate range to be 1.75% to 2.25%, depending on the average maximum

borrowing amount, (iv) lowered the base rate applicable margin rate range to be 0.75% to 1.25%, depending on the

average maximum borrowing amount, and (v) eliminated the following financial covenants: total leverage ratio, the

total debt to consolidated EBIT ratio, and total debt to original equipment cost ratio. In connection with this

amendment, the Company expensed $0.4 million of previously capitalized debt issuance costs relating to certain

lenders who exited the syndicate.

On June 29, 2023, the ABL Facility was further amended by creating two tranches within the existing $3 billion

total credit facility, including a $2.85 billion revolving credit facility and a $150 million first-in, last-out (“FILO”)

term loan, maturing May 9, 2028. The proceeds from the FILO loan were used to pay down existing borrowing

under the revolving credit facility, resulting in an increase in availability under the ABL Facility. The borrowings

under the FILO loan bear a floating interest rate at the SOFR, plus a credit spread adjustment of 10 basis points and

an additional spread of 375 basis points to 425 basis points, based on an availability matrix. Upon the occurrence of

certain events, the Company must make mandatory prepayments of (i) 100% of net proceeds from an equity

issuance (other than the in-process issuance of perpetual preferred stock and common stock or a fixed charge

coverage ratio (“FCCR”) contribution required to be made under the ABL Facility), until the FILO term loan is

repaid in full; (ii) 50% of net proceeds from the issuance or incurrence of any bond, term loan or other indebtedness

(excluding certain exceptions), until the FILO loan is repaid in full; and, (iii) voluntary prepayments of the FILO

term loan so long as no event of default (as defined) exists or would result from such prepayment or when certain

payment conditions, as defined, are met. In connection with this amendment, the Company incurred debt issuance

costs of $2 million.

On September 19, 2023, the ABL Facility was amended and restated reducing the required debt repayment of

the FILO term loan from the net proceeds from the issuance of the Additional 2028 Notes (defined below) from

$150 million to $50 million.

On June 27, 2024, the Company amended the ABL Facility to, among other things, calculate certain financial

covenants, including those that potentially impact the overall borrowing capacity, on a pro forma basis to give effect

to the Company’s purchase of previously-leased rental equipment, and to permit the Company to incur an increased

amount of second-lien secured debt under other indebtedness.

The ABL Facility contains negative covenants that permit, subject to certain defined conditions, the Company’s

ability to, among other things, (i) incur additional indebtedness or engage in certain other types of financing

transactions, (ii) allow certain liens to attach to assets, (iii) repurchase, or pay dividends, or make certain other

restricted payments on, capital stock and certain other securities, (iv) prepay certain indebtedness and (v) make

acquisitions and investments.

In addition, the FCCR covenant under the ABL Facility will only apply in the future if specified availability

under the ABL Facility falls below ten percent of the maximum revolver under the ABL Facility.

As of December 31, 2024, the Company had $465 million outstanding under the ABL Facility bearing interest

at the SOFR of 6.44%, included in long-term debt on the consolidated balance sheets.

ABL Credit Facility

On November 26, 2025, the Company refinanced existing borrowings under the ABL Facility by entering into a

new senior secured asset-based revolving credit facility (“ABL Credit Facility”). The new ABL Credit Facility has a

maturity date of November 26, 2030. The ABL Credit Facility provides available “borrowing capacity” (the

maximum borrowing permitted, assuming there is sufficient collateral as identified under the new ABL Credit

Facility) up to $2.75 billion. Borrowings under the new ABL Credit Facility will bear interest at a rate (at the

Company’s election) equal to either (a) the Secured Overnight Financing Rate (“SOFR”) plus a spread between

112.5 to 137.5 basis points or (b) the greatest of (i) 0%, (ii) the Federal Funds Rate in effect on such day plus 50

basis points, (iii) the Secured Overnight Financing Rate for a one month tenor in effect on such day (to the extent

ascertainable), plus 100 basis points, and (iv) the Prime Rate plus (y) a spread between 12.5 basis points and 37.5

basis points. In connection with the refinancing, the Company expensed $8 million of previously capitalized debt

issuance costs relating to certain lenders under the ABL Facility who exited the syndicate, and included in loss on

debt extinguishment on the consolidated statements of net income. Additionally, in connection with the refinancing,

the Company capitalized $9 million of debt issuance costs.

The ABL Credit Facility contains negative covenants that permit, subject to certain defined conditions, the

Company to, among other things, (i) incur additional indebtedness or engage in certain other types of financing

transactions, (ii) allow certain liens to attach to assets, (iii) repurchase, or pay dividends, or make certain other

restricted payments on, capital stock and certain other securities, subject to applicable caps, (iv) prepay certain

indebtedness and (v) make certain acquisitions and investments. Under the new ABL Credit Facility, there is one

financial covenant that will only apply in the future if excess availability under the new ABL Credit Facility falls

below the greater of 10 percent of the maximum borrowing amount under the new ABL Credit Facility or $175

million. As of December 31, 2025, availability under the ABL Credit Facility exceeded this threshold and, as a

result, the financial covenant was not applicable.

As of December 31, 2025, the Company had $1,196 million outstanding under the ABL Credit Facility bearing

interest at the SOFR of 4.86%, included in long-term debt on the consolidated balance sheets.

The ABL Credit Facility provides available “borrowing capacity” (the maximum borrowing permitted,

assuming there is sufficient collateral as identified under the ABL Facility) and “net excess availability” (the amount

of additional debt the Company could borrow based on the existing borrowing base). As of December 31, 2025, the

Company had a borrowing base, as defined under the ABL Credit Facility, of $2,240 million. After outstanding

borrowings and letters of credit, the net excess availability at December 31, 2025, as defined under the ABL facility

credit agreement, was $1,039 million, of which the Company could borrow up to $815 million without any

additional repayment conditions.

Senior Secured Second Lien Notes due 2028

On May 9, 2023, the Company issued $640 million of its 9.00% Senior Secured Second Lien Notes due 2028

(the “2028 Notes”) at a discount to par of 94.26%. Interest on the 2028 Notes accrues at the rate of 9.00% per annum

and is payable semi-annually on May 15 and November 15. The 2028 Notes will mature on May 15, 2028. After

deducting $37 million in original issue discounts and $7 million in offering expenses and costs, net proceeds from

the issuance of the Notes was $597 million. Upon the issuance of the 2028 Notes, the Company capitalized $5

million of bond financing costs.

Additional Senior Secured Second Lien Notes due 2028

On September 21, 2023, the Company issued an additional $400 million of its 9.00% Senior Secured Second

Lien Notes due 2028 (the “Additional 2028 Notes”) at a discount to par of 97.75%. Interest on the Additional 2028

Notes accrues at a rate of 9.00% per annum beginning on May 9, 2023, and is payable semi-annually on May 15 and

November 15. The Additional 2028 Notes will mature on May 15, 2028. After deducting $9 million in original issue

discounts and $4 million in offering expenses and costs, net proceeds from the issuance of the Additional 2028

Notes was $387 million. Upon the issuance of the Additional 2028 Notes, the Company capitalized $1 million of

bond financing costs. Additionally, the Company received $13 million of accrued interest from the purchasers of the

Additional 2028 Notes for the period from May 9, 2023 to September 20, 2023, which was paid to the bondholders

along with accrued interest on November 15, 2023.

Senior Secured Second Lien Notes due 2032

On April 16, 2024, the Company issued $600 million of its 8.625% Senior Secured Second Lien Notes due

2032 (the “2032 Notes”). Interest on the 2032 Notes accrues at a rate of 8.625% per annum and is payable semi-

annually on May 15 and November 15, commencing November 15, 2024. The 2032 Notes will mature on May 15,

2032. After deducting $6 million in offering expenses and costs, net proceeds from the issuance of the Notes was

$594 million. Upon the issuance of the Notes, the Company capitalized $4 million of bond financing costs.

Senior Secured Second Lien Notes due 2033

On September 10, 2024, the Company issued $500 million of its 8.00% Senior Secured Second Lien Notes due

2033 (the “2033 Notes”). Interest on the 2033 Notes accrues at the rate of 8.00% per annum and is payable semi-

annually on May 15 and November 15, commencing March 15, 2025. The 2033 Notes will mature on March 15,

2033. After deducting $5 million in offering expenses and costs, net proceeds from the issuance of the 2033 Notes

was $495 million. Upon the issuance of the 2033 Notes, the Company capitalized $2 million of bond financing

costs.

Ranking: Notes and Guarantees

The 2028 Notes and Additional 2028 Notes are the Company’s senior secured obligations, secured by

substantially all of the assets of the Company, and will rank equal in right of payment with all of the Company’s

existing and future senior indebtedness, including indebtedness under the ABL Facility, rank senior in right of

payment to all of the Company’s future subordinated indebtedness, rank effectively senior to the Company’s

existing and future senior unsecured indebtedness to the extent of the value of the collateral securing the 2028 Notes

and Additional 2028 Notes, rank effectively junior to all of the Company’s existing and future first-priority lien

indebtedness (including indebtedness under the ABL Facility) to the extent of the value of the collateral securing

such indebtedness; and effectively junior to any of the Company’s other existing and future indebtedness that is

secured by assets that do not constitute collateral for the 2028 Notes and Additional 2028 Notes to the extent of the

value of such assets. The 2028 Notes and Additional 2028 Notes will be jointly and severally guaranteed on a senior

secured second lien basis by each of the Company’s domestic subsidiaries, secured by substantially all of the

guarantor’s assets that secure any first-priority lien obligations, subject to permitted liens and certain exceptions.

The 2032 Notes are the Company’s senior secured obligations, secured by substantially all of the assets of the

Company, and will rank equal in right of payment with all of the Company’s existing and future senior indebtedness,

including indebtedness under the ABL Facility, the 2028 Notes, and Additional 2028 Notes, rank senior in right of

payment to all of the Company’s future subordinated indebtedness, rank effectively senior to the Company’s

existing and future senior unsecured indebtedness to the extent of the value of the collateral securing the 2032 Notes,

rank effectively junior to all of the Company’s and any Guarantor’s existing and future first-priority lien

indebtedness (including indebtedness under the ABL Facility) to the extent of the value of the collateral securing

such indebtedness, rank equal with all of the Company’s and any Guarantor’s existing and future indebtedness that

is secured on a second-priority basis by the Collateral (including the 2028 Notes and Additional 2028 Notes) to the

extent of the value of the collateral securing the 2032 Notes; and effectively junior to any of the Company’s and any

Guarantor’s other existing and future indebtedness that is secured by assets that do not constitute collateral for the

2032 Notes to the extent of the value of such assets. The 2032 Notes will be jointly and severally guaranteed on a

senior secured second lien basis by each of the Company’s domestic subsidiaries, secured by substantially all of the

guarantor’s assets that secure any first-priority lien obligations, subject to permitted liens and certain exceptions, and

secured on an equal basis by liens on certain of the Company’s assets that secure any other second lien obligations,

subject to permitted liens.

The 2033 Notes are the Company’s senior secured obligations, secured by substantially all of the assets of the

Company, and will rank equal in right of payment with all of the Company’s existing and future senior indebtedness,

including indebtedness under the ABL Facility, the 2028 Notes, Additional 2028 Notes, and 2032 Notes, rank senior

in right of payment to all of the Company’s future subordinated indebtedness, rank effectively senior to the

Company’s existing and future senior unsecured indebtedness to the extent of the value of the collateral securing the

2033 Notes, rank effectively junior to all of the Company’s and any Guarantor’s existing and future first-priority lien

indebtedness (including indebtedness under the ABL Facility) to the extent of the value of the collateral securing

such indebtedness, rank equal with all of the Company’s and any Guarantor’s existing and future indebtedness that

is secured on a second-priority basis by the Collateral (including the 2028 Notes, Additional 2028 Notes, and 2032

Notes) to the extent of the value of the collateral securing the 2033 Notes; and effectively junior to any of the

Company’s and any Guarantor’s other existing and future indebtedness that is secured by assets that do not

constitute collateral for the 2033 Notes to the extent of the value of such assets. The 2033 Notes will be jointly and

severally guaranteed on a senior secured second lien basis by each of the Company’s domestic subsidiaries, secured

by substantially all of the guarantor’s assets that secure any first-priority lien obligations, subject to permitted liens

and certain exceptions, and secured on an equal basis by liens on certain of the Company’s assets that secure any

other second lien obligations, subject to permitted liens.

Redemption

The Company may redeem the 2028 Notes and Additional 2028 Notes, in whole or in part, at any time (i) on or

after May 15, 2025 and prior to May 15, 2026, at a price equal to 106.75% of the principal amount of the 2028

Notes and Additional 2028 Notes, (ii) on or after May 15, 2026 and prior to May 15, 2027, at a price equal to

104.50% of the principal amount of the 2028 Notes and Additional 2028 Notes and (iii) on or after May 15, 2027, at

a price equal to 100.00% of the principal amount of the 2028 Notes and Additional 2028 Notes, in each case, plus

accrued and unpaid interest and additional amounts, if any, up to, but excluding, the redemption date. In addition,

the Company could have redeemed some or all of the 2028 Notes and Additional 2028 Notes at any time prior to

May 15, 2025, by paying a “make-whole” premium, plus accrued and unpaid interest, if any, to the date of

redemption. At any time prior to May 15, 2025, the Company may use net cash proceeds of certain equity offerings

to redeem up to 40% of the principal amount of the 2028 Notes and Additional 2028 Notes at a redemption price

equal to 109.00%, provided that, after giving effect to such redemption, at least 50% of the principal amount of such

2028 Notes and Additional 2028 Notes issued on the issue date remain outstanding. If there are not less than 90% in

the aggregate principal amount of outstanding 2028 Notes and Additional 2028 Notes validly tendered and the

Company purchases such 2028 Notes and Additional 2028 Notes, the Company will have the right to redeem all

2028 Notes and Additional 2028 Notes that remain outstanding following such purchase at a price equal to the price

paid to each other holder in such tender offer (which may be less than par) plus, to the extent not included in the

tender offer payment, accrued and unpaid interest. Upon the occurrence of a Change of Control, as defined, the

Company is required to make an offer to purchase the 2028 Notes and Additional 2028 Notes at a redemption price

equal to 101.00% of the principal amount thereof, plus accrued and unpaid interest. If the Company sells assets

outside the ordinary course of business and does not use the net proceeds for specified purposes, the Company is

required to make an offer to use such net proceeds to repurchase the 2028 Notes and Additional 2028 Notes at

100.00% of their aggregate principal amount, plus accrued and unpaid interest to the redemption date. If an Event of

Default occurs, as defined, the holders of at least 30% in the aggregate principal amount of the 2028 Notes and

Additional 2028 Notes then outstanding may declare the principal of, premium or the applicable premium, and

accrued and unpaid interest, on all of the outstanding 2028 Notes and Additional 2028 Notes due and payable

immediately.

The Company may redeem the 2032 Notes, in whole or in part, at any time (i) on or after May 15, 2027 and

prior to May 15, 2028, at a price equal to 104.313% of the principal amount of the 2032 Notes, (ii) on or after May

15, 2028 and prior to May 15, 2029, at a price equal to 102.156% of the principal amount of the 2032 Notes and (iii)

on or after May 15, 2029, at a price equal to 100.000% of the principal amount of the 2032 Notes, in each case, plus

accrued and unpaid interest and additional amounts, if any, up to, but excluding, the redemption date. In addition,

the Company may redeem some or all of the 2032 Notes at any time prior to May 15, 2027, by paying a “make-

whole” premium, plus accrued and unpaid interest, if any, to the date of redemption. At any time prior to May 15,

2027, the Company may use net cash proceeds of certain equity offerings to redeem up to 40% of the principal

amount of the Notes at a redemption price equal to 108.625%, provided that, after giving effect to such redemption,

at least 50% of the principal amount of such 2032 Notes issued on the issue date remain outstanding. If there are not

less than 90% in the aggregate principal amount of outstanding 2032 Notes validly tendered and the Company

purchases such 2032 Notes, the Company will have the right to redeem all 2032 Notes that remain outstanding

following such purchase at a price equal to the price paid to each other holder in such tender offer (which may be

less than par) plus, to the extent not included in the tender offer payment, accrued and unpaid interest. Upon the

occurrence of a Change of Control, as defined, the Company is required to make an offer to purchase the 2032 Notes

at a redemption price equal to 101.00% of the principal amount thereof, plus accrued and unpaid interest. If the

Company sells assets outside the ordinary course of business and does not use the net proceeds for specified

purposes, the Company is required to make an offer to use such net proceeds to repurchase the 2032 Notes at

100.00% of their aggregate principal amount, plus accrued and unpaid interest to the redemption date. If an Event of

Default occurs, as defined, the holders of at least 30% in the aggregate principal amount of the 2032 Notes then

outstanding may declare the principal of, premium or the applicable premium, and accrued and unpaid interest, on

all of the outstanding Notes due and payable immediately.

The Company may redeem the 2033 Notes, in whole or in part, at any time (i) on or after September 15, 2027

and prior to September 15, 2028, at a price equal to 104.000% of the principal amount of the 2033 Notes, (ii) on or

after September 15, 2028 and prior to September 15, 2029, at a price equal to 102.000% of the principal amount of

the 2033 Notes and (iii) on or after September 15, 2029, at a price equal to 100.000% of the principal amount of the

2033 Notes, in each case, plus accrued and unpaid interest and additional amounts, if any, up to, but excluding, the

redemption date. In addition, the Company may redeem some or all of the 2033 Notes at any time prior to

September 15, 2028, by paying a “make-whole” premium, plus accrued and unpaid interest, if any, to the date of

redemption. At any time prior to September 15, 2027, the Company may use net cash proceeds of certain equity

offerings to redeem up to 40% of the principal amount of the Notes at a redemption price equal to 108.00%,

provided that, after giving effect to such redemption, at least 50% of the principal amount of such 2033 Notes issued

on the issue date remain outstanding. If there are not less than 90% in the aggregate principal amount of outstanding

2033 Notes validly tendered and the Company purchases such 2033 Notes, the Company will have the right to

redeem all 2033 Notes that remain outstanding following such purchase at a price equal to the price paid to each

other holder in such tender offer (which may be less than par) plus, to the extent not included in the tender offer

payment, accrued and unpaid interest. Upon the occurrence of a Change of Control, as defined, the Company is

required to make an offer to purchase the 2033 Notes at a redemption price equal to 101.00% of the principal

amount thereof, plus accrued and unpaid interest. If the Company sells assets outside the ordinary course of business

and does not use the net proceeds for specified purposes, the Company is required to make an offer to use such net

proceeds to repurchase the 2033 Notes at 100.00% of their aggregate principal amount, plus accrued and unpaid

interest to the redemption date. If an Event of Default occurs, as defined, the holders of at least 30% in the aggregate

principal amount of the 2033 Notes then outstanding may declare the principal of, premium or the applicable

premium, and accrued and unpaid interest, on all of the outstanding Notes due and payable immediately.

Covenants

The indentures governing the 2028 Notes, Additional 2028 Notes, 2032 Notes, and 2033 Notes, collectively,

(the “Company’s Notes”) contain certain covenants applicable to the Company and its restricted subsidiaries,

including limitations on liens, indebtedness, mergers, consolidations, and acquisitions, sales, transfers and other

dispositions of assets, loans and other investments, dividends and other distributions, stock repurchases and

redemptions and other restricted payments, restrictions affecting subsidiaries, transactions with affiliates and

designations of unrestricted subsidiaries. Each of the covenants are subject to a number of important exceptions and

qualifications. In addition, many of the restrictive covenants will not apply to the Company during any period when

the Company’s Notes are rated investment grade, provided at such time no default under the Indenture has occurred

and is continuing.

Use of Proceeds

During 2023, in connection with the issuance of the 2028 Notes discussed above, the Company used $589

million of the proceeds to repay $493 million principal outstanding, $4 million accrued interest, and $20 million

prepayment premium to extinguish certain debt. Approximately $10 million of unamortized original issuance costs

related to this debt were also expensed in connection with this extinguishment. Separately, the Company repaid $72

million principal outstanding and $1 million accrued interest, to extinguish other debt.

During 2023, in connection with the issuance of the Additional 2028 Notes discussed above, the Company used

$335 million of the proceeds to repay $285 million principal outstanding on the ABL revolving credit facility and

$50 million principal outstanding on the FILO term loan.

During 2024, in connection with the issuances of the 2032 Notes and 2033 Notes discussed above, the Company

used $519 million and $494 million, respectively, of the proceeds to repay principal outstanding on the ABL

revolving credit facility.

Amendments to the Indentures Governing the 2028 Notes, the Additional 2028 Notes, and the 2032 Notes

On July 17, 2025, the indentures governing the Company’s 2028 Notes, the Additional 2028 Notes, and the

2032 Notes were amended to conform certain covenants and related definitions for these notes to the indenture

governing the Company’s 2033 Notes. Among other things, the amendments increased certain limits on debt

incurrence to align with the 2033 Notes and aligned certain aspects of the lien covenant to the same terms in the

2033 Notes Indenture. In connection with these amendments to the indentures, the Company paid $5 million in fees

and expenses.

Equipment Financing Lines of Credit

The Company has equipment financing lines of credit borrowing arrangements with certain financial

institutions, unrelated to the manufacturer, which are utilized to finance certain purchases of new equipment

inventory held for sale. As of December 31, 2025 and 2024, the outstanding balances under equipment financing

lines of credit were $3 million and $9 million, respectively. Interest charged on outstanding balances are based on

variable rates commonly referenced in the market, plus an applicable margin. The outstanding borrowings are

secured by the equipment inventory purchased. Repayment terms vary, but generally the outstanding amounts are

due when the equipment inventory is sold to the end customer. Borrowings from, and repayments to, financial

institutions unaffiliated with the manufacturer are classified as financing cash flows in the accompanying

consolidated statements of cash flows.

Other

Certain note agreements between the Company and various institutions contain restrictions and financial

covenants, including maintaining an adjusted fixed charge coverage ratio of 1.15 to 1.00 and a net funded debt to

adjusted EBITDA ratio of 6.00 to 1.00. As of December 31, 2025 and 2024, the Company was in compliance with

those restrictions and financial covenants.

As of December 31, 2025 and 2024, the Company had $6 million and $6 million of letters of credit outstanding

with financial institutions secured by line of credit availability, respectively. The letters of credit automatically

renew annually unless the Company gives notice to the financial institution to terminate the letter of credit.