LONG-TERM DEBT

3 Months Ended

Mar. 31, 2024

LONG-TERM DEBT

LONG-TERM DEBT

NOTE 16.    LONG-TERM DEBT

Long-term debt on our Consolidated Balance Sheets consists of the following:

	March 31,		December 31,
	2024		2023
Convertible Notes due 2028	$	575,000	$	575,000
Term Loan Facility due 2026		350,000		355,000
Gross long-term debt, including current maturities		925,000		930,000
Less: debt discount		(13,505)		(14,321)
Net long-term debt, including current maturities		911,495		915,679
Less: current maturities		(20,000)		(20,000)
Net long-term debt	$	891,495	$	895,679

For all periods presented, we were in compliance with the covenants under all debt agreements. Contractual maturities of our gross long-term debt, including current maturities, are as follows:

Year Ending December 31,
2024 (remaining)	$	15,000
2025		20,000
2026		315,000
2027		—
2028		575,000
Total	$	925,000

	March 31, 2024
	Balance		Interest  Rate
Convertible Notes	$	575,000	2.50%
Term Loan Facility at fixed interest rate due to interest rate swap		216,344	1.17%
Term Loan Facility at variable interest rate		133,656	6.18%
Total borrowings	$	925,000

The interest rate swap contracts expire on September 10, 2024. After that date, this portion of our Term Loan Facility will be subject to a variable interest rate. For more information, see Note 6. Derivative Financial Instruments. The Term Loan Facility and Revolving Facility bear interest, at our option, at a rate based on the Base Rate or SOFR, as defined in the Credit Agreement, plus an applicable margin.

The following table summarizes interest expense related to our debt:

	Three Months Ended March 31,
	2024		2023
Interest expense	$	6,302	$	2,590
Amortization of debt issuance costs		820		133
Total interest expense related to debt	$	7,122	$	2,723

Convertible Senior Notes due 2028

On September 12, 2023, we completed a private, unregistered offering of $575.0 million aggregate principal amount of 2.50% convertible senior notes (“Convertible Notes”).

The $562.6 million remaining outstanding principal amount of the 2.50% Convertible Notes, net of unamortized issuance costs, continues to be classified as long-term debt as none of the conversion triggers occurred as of March 31, 2024. The redemption price is 100% of the principal amount plus accrued and unpaid interest. The Convertible Notes mature on September 15, 2028, unless earlier repurchased, redeemed, or converted. Interest is payable semi-annually in arrears in March and September.

Concurrent with the Convertible Notes issuance, we entered into hedges and sold warrants with respect to our common stock. In combination, the hedges and warrants synthetically increase the initial conversion price on the Convertible Notes from $137.46 to $179.76, reducing the potential dilutive effect.

Credit Agreement

Our credit agreement dated as of September 10, 2019, as amended (the “Credit Agreement”) consists of a senior unsecured term loan facility (“Term Loan Facility”) and a senior unsecured revolving facility (“Revolving Facility”). Both mature on September 9, 2026.

On March 31, 2023, we executed agreements pursuant to the Credit Agreement to transition the benchmark interest rate from LIBOR to SOFR. The impact of this transition was not material to our consolidated financial statements.

On September 7, 2023, we entered into an additional amendment to the Credit Agreement to amend certain definitions, covenants, and events of default.

The following table summarizes our availability to withdraw on the Revolving Facility:

	March 31,		December 31,
	2024		2023
Available capacity on Revolving Facility	$	200,000	$	200,000

As part of our available capacity on the Revolving Facility, prior to the maturity date of the Credit Agreement, we may request an increase to the financing commitments in either the Term Loan Facility or Revolving Facility by an aggregate amount not to exceed $115.0 million. Any requested increase is subject to lender approval.

We use level 2 measurements to estimate the fair value of our debt. As of March 31, 2024, we estimate the fair value of our Convertible Notes to be $585.9 million, and the par value of the Term Loan Facility approximates its fair value.