XML 28 R16.htm IDEA: XBRL DOCUMENT v3.26.1
LONG-TERM DEBT
 3 Months Ended
Mar. 31, 2026
Debt Disclosure [Abstract]  
LONG-TERM DEBT LONG-TERM DEBT
Long-term debt consisted of the following:
Effective Interest RateFace ValueMarch 31, 2026December 31, 2025
In millionsBook Value
Fair Value1
Book Value
Fair Value1
2025 Credit Agreement:
Revolving Credit Facility4.2 %N/A$427 $427 $— $— 
Term Loan Facility, due 20305.1 %$725 721 725 721 725 
2025 Term Credit Agreement:
Term Loan, due 20264.8 %$500 500 500 500 500 
Senior Notes:
3.45% Senior Notes, due 2026
3.5 %$750 750 746 750 746 
1.25% Senior Notes (EUR), due 2027
1.5 %€500 574 556 583 575 
4.70% Senior Notes, due 2028
4.8 %$1,250 1,247 1,251 1,247 1,266 
4.90% Senior Notes, due 2030
5.1 %$500 496 503 496 512 
5.611% Senior Notes, due 2034
5.7 %$500 496 512 496 526 
5.50% Senior Notes, due 2035
5.6 %$750 743 760 743 783 
Uncommitted Money Market Line Credit Agreement
4.1 %N/A51 51 — — 
Revolving Receivables Program
4.8 %N/A445 445 — — 
Other Borrowings88 88 5 5 
Total6,538 6,564 5,541 5,638 
Less: current portion(1,830)(1,826)(1,250)(1,246)
Long-term portion$4,708 $4,738 $4,291 $4,392 
1. See Note 13 for information on the fair value measurement of the Company's long-term debt.
Variances between Face Value and Book Value are the result of unamortized discounts and debt issuance fees as well as foreign exchange on the Euro Notes and euro denominated borrowings under the Revolving Credit Facility.
The Company has debt issuance costs related to certain financing transactions which are also amortized through interest expense. As of March 31, 2026 and December 31, 2025, the Company had total combined unamortized discount and debt issuance costs of $24 million and $26 million, respectively. Amortization of discounts and debt issuance fees are included in the calculation of Effective Interest Rate.
Credit Agreements
On November 28, 2025, the Company entered into a new stand-alone credit agreement (the "2025 Term Credit Agreement") for a term loan of $500 million. Borrowings under the 2025 Term Credit Agreement bear interest at a base rate plus an interest rate spread up to 1.50% based on the lower of the pricing corresponding to (i) the Company's Leverage Ratio or (ii) the Company's public credit rating. The frequency of interest payments varies based upon the Interest Election Request. The term loan issued under this agreement will mature on November 27, 2026. The obligations of the Company under this agreement are unsecured and have been guaranteed by certain of the Company's subsidiaries. The agreement contains affirmative, negative and financial covenants, and events of default customary for facilities of this type. Under the 2025 Term Credit Agreement, the Company has agreed to maintain the same Interest Coverage Ratio and Leverage Ratio as the 2025 Credit Agreement. The borrowing rate for the agreement is a variable rate assessed periodically in accordance with the terms of the agreement. At March 31, 2026, the interest rate was 4.7%.
On April 23, 2025, the Company entered into a new unsecured credit agreement (the "2025 Credit Agreement"), which amended, restated, and refinanced the prior credit agreements. The 2025 Credit Agreement provides for borrowings consisting of (i) a multi-currency revolving credit facility for a U.S. dollar equivalent of up to $2.0 billion (the “Revolving Credit Facility”) and (ii) a delayed draw term loan facility of $725 million (the “Term Loan Facility”), all pursuant to the terms and conditions of the 2025 Credit Agreement. The Term Loan Facility was utilized to refinance outstanding borrowings with the remaining amount utilized as part of funding for the Inspection Technologies acquisition. The 2025 Credit Agreement includes an incremental facility that allows the Company to request, at prevailing market rates, an aggregate amount not to exceed $1.0 billion, (a) increases to the borrowing commitments under the Revolving Credit Facility and/or (b) new incremental term
loan commitments (the "Incremental Facility"). The agreement contains affirmative, negative and financial covenants, and events of default customary for facilities of this type.
The Revolving Credit Facility matures on April 23, 2030. The Term Loan Facility was fully drawn at March 31, 2026, and all borrowings mature on April 23, 2030. Amounts borrowed and repaid under the Term Loan Facility may not be reborrowed. The applicable interest rate for borrowings under the 2025 Credit Agreement includes a base rate (per the Interest Election terms of the agreement) plus an interest rate spread up to 1.75% based on the lower of the pricing corresponding to (i) the Company’s financial leverage or (ii) the Company’s public credit rating. At March 31, 2026, the interest rate on the Term Loan Facility was 4.9%, and the interest rate on the Revolving Credit Facility was 4.9%. Obligations under the 2025 Credit Agreement have been guaranteed by certain of the Company’s subsidiaries.
Under the 2025 Credit Agreement, the Company has agreed to maintain an Interest Coverage Ratio of at least 3.0 to 1.0, and a Leverage Ratio not to exceed 3.5 to 1.0. The Interest Coverage Ratio is calculated using an earnings metric as defined in the agreement compared to Interest Expense for the four quarters then ended. The Leverage Ratio is defined as net debt (total debt, net of up to $500 million of unrestricted cash) as of the last day of such fiscal quarter to the defined earnings metric for the four quarters then ended. Additionally, the Company may effect an increase in the maximum Leverage Ratio in contemplation of a Material Acquisition. All terms are as defined in the 2025 Credit Agreement.
The following table presents availability under the 2025 Credit Agreement at March 31, 2026:
In millionsRevolving Credit FacilityTerm Loan FacilityTotal
Maximum Availability$2,000 $725 $2,725 
Outstanding Borrowings(427)(725)(1,152)
Letters of Credit Under Credit Agreement— — — 
Current Availability$1,573 $— $1,573 
The Company was in compliance with all financial covenants in the 2025 Credit Agreement and the 2025 Term Credit Agreement as of March 31, 2026.
Uncommitted Money Market Line Credit Agreement
During the third quarter of 2024, the Company entered into an uncommitted bilateral money market line credit agreement which provides an aggregate borrowing capacity of $150 million, for general business purposes and working capital needs. At March 31, 2026, the interest rate was 4.2%.
Senior Notes
The Company or its subsidiaries may issue senior notes from time to time. These notes are comprised of our 3.45% Senior Notes due 2026 (the "2026 Notes"), 1.25% Senior Notes (EUR) due 2027 (the "Euro Notes"), 4.70% Senior Notes due 2028 (the "2028 Notes"), 4.90% Senior Notes due 2030 (the "2030 Notes"), 5.611% Senior Notes due 2034 (the "2034 Notes"), and 5.50% Senior Notes due 2035 (the "2035 Notes"). The 2026 Notes, 2028 Notes, 2030 Notes, 2034 Notes, and 2035 Notes are the “US Notes”, and collectively with the Euro Notes, the “Senior Notes.” Interest on the US Notes is payable semi-annually and interest on the Euro Notes is paid annually. Each series of the Senior Notes may be redeemed at any time in whole or from time to time in part in accordance with the provisions of the indenture, under which such series of notes was issued. Each of the Senior Notes may be redeemed at a redemption price of 100% of the principal amount plus a specified make-whole premium and accrued interest. The US Notes and the Company's guarantee of the Euro Notes are senior unsecured obligations of the Company and rank pari passu with all existing and future senior debt, and are senior to all existing and future subordinated indebtedness of the Company.
On May 29, 2025, the Company issued (i) $500 million of 4.90% Senior Notes due 2030 and (ii) $750 million of 5.50% Senior Notes due 2035. The 2030 Notes and 2035 Notes were issued at approximately 100% of face value, and the Company recognized approximately $12 million of total deferred financing costs. Interest on the 2030 Notes and 2035 Notes will accrue at a rate of 4.90% and 5.50%, respectively, per year, payable semi-annually on May 29 and November 29 of each year, commencing November 29, 2025. The 2030 Notes will mature on May 29, 2030, and the 2035 Notes will mature on May 29, 2035.
Proceeds from the 2030 Notes and cash on hand were utilized to repay the outstanding amount of notes due in 2025 at maturity. Proceeds from the 2035 Notes were utilized as part of funding for the Inspection Technologies acquisition, which closed July 1, 2025.
The indentures under which the Senior Notes were issued contain covenants and restrictions which limit, subject to certain exceptions, certain sale and leaseback transactions with respect to principal properties, the incurrence of secured debt without equally and ratably securing the Senior Notes, and certain merger and consolidation transactions. The covenants do not
require the Company to maintain any financial ratios or specified levels of net worth or liquidity. The US Notes are fully and unconditionally guaranteed, jointly and severally, on an unsecured basis by each of the Company's subsidiaries that is a guarantor under the 2025 Credit Agreement. The Euro Notes were issued by Wabtec Transportation Netherlands B.V. and are fully and unconditionally guaranteed by the Parent Company.
The Company is in compliance with the restrictions and covenants in the indentures under which the Senior Notes were issued and expects that these restrictions and covenants will not be any type of limiting factor in executing our operating activities.