DEBT

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

DEBT

DEBT

Our debt consisted of the following at March 31, 2022:

	March 31, 2022
Debt
Term Credit Agreement borrowings due 2028 at a variable interest rate of 1.9% at March 31, 2022 (a)	$350,000
Senior Notes due 2031 at a fixed interest rate of 2.75%	450,000
Incremental Term Loan Agreement borrowings due 2026 at a variable interest rate of 1.9% at  March 31, 2022 (b)	200,000
2021 Incremental Term Loan Facility Borrowings due 2029 at a variable interest rate of 1.8% at March 31, 2022 (c)	200,000
New Zealand subsidiary noncontrolling interests shareholder loan due 2025 at a fixed interest rate of 2.95% (d)	24,005
New Zealand subsidiary noncontrolling interests shareholder loan due 2026 at a fixed interest rate of 3.64% (d)	28,006
New Zealand Working Capital Facility due 2022 at a variable interest rate of 2.1% at March 31, 2022	2,087
Total principal debt	1,254,098
Less: Unamortized discounts	(3,346)
Less: Current maturities of long-term debt	(2,087)
Less: Deferred financing costs	(4,992)
Total long-term debt	$1,243,673

(a)    As of March 31, 2022, the periodic interest rate on the term credit agreement (the “Term Credit Agreement”) was LIBOR plus 1.600%. We estimate the effective fixed interest rate on the term loan facility to be approximately 3.0% after consideration of interest rate swaps and estimated patronage refunds.

(b)    As of March 31, 2022, the periodic interest rate on the incremental term loan (the “Incremental Term Loan Agreement”) was LIBOR plus 1.650%. We estimate the effective fixed interest rate on the incremental term loan facility to be approximately 2.4% after consideration of interest rate swaps and estimated patronage refunds.

(c)    As of March 31, 2022, the periodic interest rate on the 2021 incremental term loan (the “2021 Incremental Term Loan Facility”) was LIBOR plus 1.550%. We estimate the effective fixed interest rate on the incremental term loan facility to be approximately 1.5% after consideration of interest rate swaps and estimated patronage refunds.

(d)    Except for changes in the New Zealand foreign exchange rate, there have been no adjustments to the carrying value of the shareholder loans since inception.

Principal payments due during the next five years and thereafter are as follows:

	Total
2022	$2,087
2023	—
2024	—
2025	24,005
2026	228,006
Thereafter	1,000,000
Total Debt	$1,254,098

2022 DEBT ACTIVITY

U.S. Debt

On January 3, 2022, we drew $200.0 million on our Revolving Credit Facility. On January 4, 2022, we repaid the $325.0 million Senior Notes due 2022 with $125.0 million of cash and the $200.0 million previously drawn on the Revolving Credit Facility. We then made a $200.0 million draw on our 2021 Incremental Term Loan Facility and simultaneously repaid the outstanding principal on our Revolving Credit Facility. The periodic interest rate on the 2021 Incremental Term Loan agreement is subject to a pricing grid based on our leverage ratio, as defined in the credit agreement. As of March 31, 2022, the periodic interest rate on the 2021 Incremental Term Loan is LIBOR plus 1.55%. Monthly payments of interest only are due on this loan through maturity.

On February 1, 2022, our $200.0 million notional forward-starting interest rate swap matured into an active interest rate swap. This interest rate swap will fix the cost of the 2021 Incremental Term Loan Facility over its seven-year term. We estimate the effective interest rate on the 2021 Incremental Term Loan Facility to be approximately 1.5% after consideration of interest rate swaps and estimated patronage refunds.

At March 31, 2022, we had available borrowings of $299.1 million under the Revolving Credit Facility, net of $0.9 million to secure our outstanding letters of credit.

New Zealand Debt

During the three months ended March 31, 2022, the New Zealand subsidiary made $2.1 million of borrowings, net of repayments and changes in exchange rates, on its working capital facility (the “New Zealand Working Capital Facility”). At March 31, 2022, the New Zealand subsidiary had NZ$17.0 million of available borrowings under its working capital facility.

Subsequent Event

In April 2022, the New Zealand subsidiary recorded a noncontrolling interest share redemption and loan payable in the amount of $27.9 million. The shareholder loan is due in 2027 at a fixed rate of 6.48%. See Note 1 — Basis of Presentation for more information regarding subsequent events related to the New Zealand subsidiary.

DEBT COVENANTS

In connection with our $350 million Term Credit Agreement, $200 million Incremental Term Loan Agreement, $200 million 2021 Incremental Term Loan Facility and $300 million Revolving Credit Facility, customary covenants must be met, the most significant of which include interest coverage and leverage ratios.

The covenants listed below, which are the most significant financial covenants in effect as of March 31, 2022, are calculated on a trailing 12-month basis:

	Covenant Requirement		Actual Ratio		Favorable
Covenant EBITDA to consolidated interest expense should not be less than	2.5 to 1		13.6 to 1		11.1
Covenant debt to covenant net worth plus covenant debt shall not exceed	65	%	40	%	25	%

    In addition to these financial covenants listed above, the Senior Notes due 2031, Term Credit Agreement, Incremental Term Loan Agreement, 2021 Incremental Term Loan Facility, and Revolving Credit Facility include customary covenants that limit the incurrence of debt and the disposition of assets, among others. At March 31, 2022, we were in compliance with all applicable covenants.