Debt and Credit Facility

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Debt and Credit Facility

5. Debt and Credit Facility

Senior Notes

4.50% Senior Notes. In May 2021, we issued $550.0 million aggregate principal amount of 4.50% unsecured senior notes due June 1, 2031 at 100% of the principal amount (“4.50% Senior Notes”). The unamortized amount of debt issuance costs as of March 31, 2022 relating to the 4.50% Senior Notes was $7.8 million. Interest expense, including amortization of debt issuance costs and debt premium, relating to the 4.50% Senior Notes was $6.4 million for the quarter ended March 31, 2022. The effective interest

rate of the 4.50% Senior Notes is approximately 4.7% per annum, taking into account the amortization of debt issuance costs. The fair value of the outstanding 4.50% Senior Notes, which are Level 1 liabilities calculated based on pricing from trades around the balance sheet date, was approximately $492.2 million and $542.6 million at March 31, 2022 and December 31, 2021, respectively.

6.50% Senior Notes. In April 2020 and May 2020, we issued $300.0 million and $50.0 million, respectively, aggregate principal amounts of our 6.50% unsecured senior notes due May 1, 2025 at 100% and 101%, respectively, of the principal amounts (“6.50% Senior Notes”). On May 21, 2021 we redeemed in full the remaining balance of our 6.50% Senior Notes at a redemption price of 108.83% of the principal amount plus $1.3 million of accrued and unpaid interest for a total net cash outflow of $382.2 million. Upon redemption of the 6.50% Senior Notes, we recorded a loss on extinguishment of debt of $35.9 million within Other expense, net on our Statements of Consolidated Income, which included the premium payment of $30.9 million and a write-off of the remaining unamortized premium and debt issuance costs of $5.0 million. The effective interest rate of the 6.50% Senior Notes was approximately 6.8% per annum, taking into account the amortization of premium and debt issuance costs. Interest expense, including amortization of debt issuance costs, relating to the 6.50% Senior Notes was $6.0 million for the quarter ended March 31, 2021.

4.625% Senior Notes. In November 2019, we issued $500.0 million aggregate principal amount of 4.625% unsecured senior notes due March 1, 2028 at 100% of the principal amount (“4.625% Senior Notes”). The unamortized amount of debt issuance costs as of March 31, 2022 was $5.4 million. Interest expense, including amortization of debt issuance costs, relating to the 4.625% Senior Notes was $6.0 million for both quarters ended March 31, 2022 and March 31, 2021, respectively. The effective interest rate of the 4.625% Senior Notes was approximately 4.8% per annum, taking into account the amortization of debt issuance costs. The fair value of the outstanding 4.625% Senior Notes, which are Level 1 liabilities, was approximately $470.2 million and $506.9 million at March 31, 2022 and December 31, 2021, respectively.

The amount of interest expense capitalized as construction in progress was $0.6 million and $0.1 million during the quarters ended March 31, 2022 and March 31, 2021, respectively.

Revolving Credit Facility

Our credit agreement with Wells Fargo Bank, National Association, as administrative agent, and the other financial institutions party thereto (“Revolving Credit Facility”) provides us with a $375.0 million funding commitment through October 2024.

On April 7, 2022, we entered Amendment No. 3 to our Revolving Credit Facility. See Note 13 for details regarding the revised terms of the Revolving Credit Facility as amended.