NOTE 3 – FINANCING

The following table identifies the amounts included in “Long-term debt” on the accompanying Condensed Consolidated Balance Sheets as of June 30, 2017, and December 31, 2016 (in thousands):



	June 30, 2017		December 31, 2016
Revolving Credit Facility, weighted-average variable interest rate of 2.065%	$	716,000	$	—
$500 million, 4.875% Senior Notes due 2021⁽¹⁾, effective interest rate of 4.958%	497,161		496,758
$300 million, 4.625% Senior Notes due 2021⁽²⁾, effective interest rate of 4.646%	298,820		298,679
$300 million, 3.800% Senior Notes due 2022⁽³⁾, effective interest rate of 3.845%	298,039		297,868
$300 million, 3.850% Senior Notes due 2023⁽⁴⁾, effective interest rate of 3.851%	298,468		298,355
$500 million, 3.550% Senior Notes due 2026⁽⁵⁾, effective interest rate of 3.570%	495,574		495,359
Long-term debt	$	2,604,062	$	1,887,019


⁽¹⁾	Net of unamortized discount of $1.2 million as of June 30, 2017, and $1.4 million as of December 31, 2016, and debt issuance costs of $1.6 million as of June 30, 2017, and $1.8 million as of December 31, 2016.


⁽²⁾	Net of unamortized discount of $0.2 million as of June 30, 2017, and December 31, 2016, and debt issuance costs of $1.0 million as of June 30, 2017, and $1.1 million as of December 31, 2016.


⁽³⁾	Net of unamortized discount of $0.6 million as of June 30, 2017, and $0.7 million as of December 31, 2016, and debt issuance costs of $1.3 million as of June 30, 2017, and $1.5 million as of December 31, 2016.


⁽⁴⁾	Net of unamortized discount of less than $0.1 million as of June 30, 2017, and December 31, 2016, and debt issuance costs of $1.5 million as of June 30, 2017, and $1.6 million as of December 31, 2016.


⁽⁵⁾	Net of unamortized discount of $0.7 million as of June 30, 2017, and $0.8 million as of December 31, 2016, and debt issuance costs of $3.7 million as of June 30, 2017, and $3.9 million as of December 31, 2016.

Unsecured revolving credit facility:

On April 5, 2017, the Company entered into a new credit agreement (the “Credit Agreement”). The new Credit Agreement provides for a $1.2 billion unsecured revolving credit facility (the “Revolving Credit Facility”) arranged by JPMorgan Chase Bank, N.A., which is scheduled to mature in April 2022. The new Credit Agreement includes a $200 million sub-limit for the issuance of letters of credit and a $75 million sub-limit for swing line borrowings under the new Revolving Credit Facility. As described in the new Credit Agreement governing the new Revolving Credit Facility, the Company may, from time to time, subject to certain conditions, increase the aggregate commitments under the new Revolving Credit Facility by up to $600 million, provided that the aggregate amount of the commitments does not exceed $1.8 billion at any time.

In conjunction with the closing of the new Credit Agreement, the Company’s previous credit agreement, which was originally entered into on January 14, 2011, as amended, was terminated (the “Terminated Credit Agreement”), and all outstanding loans and commitments, including the guarantees of each of the subsidiary guarantors, under the Terminated Credit Agreement were terminated and replaced by the loans and commitments under the new Credit Agreement. None of the Company’s subsidiaries are guarantors or obligors under the new Credit Agreement.

As of June 30, 2017, and December 31, 2016, the Company had outstanding letters of credit, primarily to support obligations related to workers’ compensation, general liability and other insurance policies, in the amounts of $41.2 million and $38.7 million, respectively, reducing the aggregate availability under the credit agreements by those amounts.

Borrowings under the new Revolving Credit Facility (other than swing line loans) bear interest, at the Company’s option, at either an Alternate Base Rate or an Adjusted LIBO Rate (both as defined in the new Credit Agreement) plus an applicable margin. Swing line loans made under the new Revolving Credit Facility bear interest at an Alternate Base Rate plus the applicable margin for Alternate Base Rate loans. In addition, the Company pays a facility fee on the aggregate amount of the commitments under the new Credit Agreement in an amount equal to a percentage of such commitments. The interest rate margins and facility fee are based upon the better of the ratings assigned to the Company’s debt by Moody’s Investor Service, Inc. and Standard & Poor’s Ratings Services, subject to limited exceptions. As of June 30, 2017, based upon the Company’s current credit ratings, its margin for Alternate Base Rate loans was 0.000%, its margin for Eurodollar Revolving Loans was 0.900% and its facility fee was 0.100%.

The new Credit Agreement contains certain covenants, including limitations on subsidiary indebtedness, a minimum consolidated fixed charge coverage ratio of 2.50:1.00 and a maximum consolidated leverage ratio of 3.50:1.00. The consolidated fixed charge coverage ratio includes a calculation of earnings before interest, taxes, depreciation, amortization, rent and non-cash share-based compensation expense to fixed charges. Fixed charges include interest expense, capitalized interest and rent expense. The consolidated leverage ratio includes a calculation of adjusted debt to earnings before interest, taxes, depreciation, amortization, rent and non-cash share-based compensation expense. Adjusted debt includes outstanding debt, outstanding stand-by letters of credit and similar instruments, five-times rent expense and excludes any premium or discount recorded in conjunction with the issuance of long-term debt. In the event that the Company should default on any covenant (subject to customary grace periods, cure rights and materiality thresholds) contained in the new Credit Agreement, certain actions may be taken, including, but not limited to, possible termination of commitments, immediate payment of outstanding principal amounts plus accrued interest and other amounts payable under the new Credit Agreement and litigation from lenders. As of June 30, 2017, the Company remained in compliance with all covenants under the new Credit Agreement.

Senior notes:

The Company has issued a cumulative $1.9 billion aggregate principal amount of unsecured senior notes, which are due between January 2021 and March 2026, with United Missouri Bank as trustee. Interest on the senior notes, ranging from 3.550% to 4.875%, is payable semi-annually and is computed on the basis of a 360-day year. Each of the senior notes is subject to certain customary covenants, with which the Company complied as of June 30, 2017.

In connection with entering into the new Credit Agreement (under which none of the Company’s subsidiaries are guarantors or obligors), and upon termination of the Terminated Credit Agreement, the guarantees by the Company’s subsidiary guarantors with respect to all of the Company’s outstanding senior notes were automatically released in accordance with the terms of the respective indentures governing the senior notes.