Long-Term Debt

9 Months Ended

Sep. 30, 2020

Our long-term debt consists of the following:


		September 30, 2020						December 31, 2019
(in thousands)		Gross		Debt Issuance Costs		Net		Gross		Debt Issuance Costs		Net
Bank debt:
	Term loan facility borrowings due May 2024, weighted-average interest rate of 1.91% as of September 30, 2020	$	1,572,000	$	(12,242)	$	1,559,758	$	1,672,188	$	(14,868)	$	1,657,320
	Revolving line of credit borrowings due May 2024, weighted-average interest rate of 1.91% as of September 30, 2020	—		(5,342)		(5,342)		—		(6,425)		(6,425)


Notes:
	7.55% senior debentures due April 2028	9,531		(24)		9,507		9,524		(26)		9,498
Other debt:
	Various debt instruments with maturities through March 2024	6,244		—		6,244		6,167		—		6,167
Total long-term debt		1,587,775		(17,608)		1,570,167		1,687,879		(21,319)		1,666,560
Less current portion of long-term debt		21,382		—		21,382		56,022		—		56,022
Long-term debt, net of current portion		$	1,566,393	$	(17,608)	$	1,548,785	$	1,631,857	$	(21,319)	$	1,610,538

As of September 30, 2020 and December 31, 2019, we recorded less than $0.1 million and $0.4 million, respectively, of accrued interest expense on our debt-related instruments within accounts payable and other accrued expenses.

Credit Agreement

In May 2019, we amended and restated our credit agreement (the “Credit Agreement”) with Bank of America, N.A., as the administrative agent, and other financial institutions. The Credit Agreement provides for a $1.8 billion 5-year term loan facility (the “Term Facility”), and a $750.0 million 5-year revolving credit facility (the “Revolving Facility”). The Term Facility matures, and the Revolving Facility expires, in May 2024. The Revolving Facility includes a $100.0 million multi-currency revolving sub-facility and a $50.0 million letter of credit sub-facility. The Credit Agreement also provides for the ability to increase the Term Facility and Revolving Facility by up to $300.0 million in the aggregate; however, the lenders are not obligated to do so. As of September 30, 2020, we had a remaining borrowing capacity of $750.0 million under the Revolving Facility and we were in compliance with all financial and restrictive covenants under the Credit Agreement.

Debt Issuance Costs

In connection with the amendment and restatement of the Credit Agreement, in May 2019, we incurred approximately $9.7 million of debt issuance costs of which $9.6 million were initially capitalized within long-term debt, net of current, in the accompanying condensed consolidated balance sheets. In addition, when we amended and restated the Credit Agreement, we wrote-off previously unamortized debt issuance costs of $1.5 million within gain/(loss) on investments and other, net, in the accompanying condensed consolidated statements of operations for the nine months ended September 30, 2019, which resulted

in a remaining $14.6 million of previously unamortized costs. We are amortizing these costs over the term of the Credit Agreement. For both the three months ended September 30, 2020 and 2019, $1.2 million was recognized in the accompanying condensed consolidated statements of operations related to the amortization of debt issuance costs. For the nine months ended September 30, 2020 and 2019, $3.7 million and $3.8 million, respectively, were recognized in the accompanying condensed consolidated statements of operations related to the amortization of debt issuance costs.

7.55% Senior Debentures

In April 1998, we issued $100.0 million in aggregate principal amount of 7.55% senior debentures due 2028. The indentures governing these debentures, as amended, contain limited restrictions on us.

Interest Rate Swaps

We have entered into amortizing interest rate swaps (“Swaps”) in order to convert a portion of our interest rate exposure on the Term Facility floating rate borrowings from variable to fixed. Under the Swaps, we agree to exchange floating rate for fixed rate interest payments periodically over the life of the agreement. The floating rates in our Swaps are based on the one-month LIBOR. The notional balances, terms and maturities of our Swaps are designed to have the effect of fixing the rate of interest on at least 50% of the principal balance of our senior term debt.

As of September 30, 2020, the Swaps have a combined remaining notional balance of $1.2 billion, a weighted average fixed interest rate of 2.40% (rates range from 0.66% to 2.98%), and scheduled terminations through December 2025. Notional balances under our Swaps are scheduled to increase and decrease based on our expectations of the level of variable rate debt to be in effect in future periods. Currently, we have scheduled notional amounts of approximately $1.2 billion through September 2021, then $1.1 billion and $1.0 billion through August 2022, and $496.8 million and $465.0 million through December 2025. Approximate weighted average fixed interest rates for the aforementioned time periods are 2.59%, 2.77%, and 2.64%, respectively.

We have designated the Swaps as cash flow hedges. The estimated fair values of these cash flow hedges are recorded in prepaid expenses and other current assets or other assets as well as accounts payable and other accrued expenses or other liabilities in the accompanying condensed consolidated balance sheets. As of September 30, 2020, the estimated fair value of these cash flow hedges resulted in a liability of $87.7 million, of which $3.5 million was recorded within accounts payable and other accrued expenses. As of December 31, 2019, the estimated fair value of these cash flow hedges resulted in an asset of $0.6 million which was recorded within prepaid expenses and other current assets, as well as a liability of $47.7 million recorded within other liabilities.

Unrealized gains of $7.9 million (net of $2.6 million in deferred taxes) and unrealized losses of $8.1 million (net of $2.7 million in deferred taxes) for the three months ended September 30, 2020 and 2019, respectively, were recognized in other comprehensive loss related to the Swaps. Unrealized losses of $30.5 million (net of $10.1 million in deferred taxes) and $41.4 million (net of $13.8 million in deferred taxes) for the nine months ended September 30, 2020 and 2019, respectively, were recognized in other comprehensive loss related to the Swaps.

As a result of our Swap activity, for the three months ended September 30, 2020 and 2019, included within interest expense, on a pre-tax basis, we recognized interest expense of $7.1 million and interest income of $0.7 million, respectively. For the nine months ended September 30, 2020 and 2019, included within interest expense, on a pre-tax basis, we recognized interest expense of $14.3 million and interest income of $4.0 million, respectively. Estimated net losses included in accumulated other comprehensive loss related to the Swaps as of September 30, 2020, that will be reclassified into earnings as interest expense over the next 12 months, utilizing September 30, 2020 LIBOR, is estimated to be $16.0 million, on a pre-tax basis.