Debt

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

Debt

Debt

The following table summarizes the Company’s Debt:

	December 31, 2022		June 30, 2023
Senior bank debt	$	349.9	$	349.9
Senior notes	1,095.2		1,096.0
Junior subordinated notes	751.6		751.8
Junior convertible securities	338.6		338.7
Debt	$	2,535.3	$	2,536.4

The Company’s senior notes, junior subordinated notes, and junior convertible securities are carried at amortized cost. Unamortized discounts and debt issuance costs are presented within the Consolidated Balance Sheets as an adjustment to the carrying value of the associated debt.

Senior Bank Debt

The Company has a $1.25 billion senior unsecured multicurrency revolving credit facility (the “revolver”) and a $350.0 million senior unsecured term loan facility (the “term loan” and, together with the revolver, the “credit facilities”). The revolver matures on October 25, 2027 and the term loan matures on October 23, 2026. Subject to certain conditions, the Company may increase the commitments under the revolver by up to an additional $500.0 million and may borrow up to an additional $75.0 million under the term loan. The Company pays interest on any outstanding obligations under the credit facilities at specified rates, currently based either on an applicable term-SOFR plus a SOFR adjustment of 0.10% or prime rate, plus a marginal rate determined based on its credit rating. As of June 30, 2023, the interest rate for the Company’s outstanding borrowings under the term loan was term-SOFR plus a SOFR adjustment of 0.10% plus the marginal rate of 0.85%. As of December 31, 2022 and June 30, 2023, the Company had no outstanding borrowings under the revolver.

Senior Notes

As of June 30, 2023, the Company had senior notes outstanding. The carrying values of the senior notes are accreted to their principal amount at maturity over the remaining life of the underlying instrument. The principal terms of the senior notes outstanding as of June 30, 2023 were as follows:

	2024 Senior Notes			2025 Senior Notes			2030 Senior Notes
Issue date	February 2014			February 2015			June 2020
Maturity date	February 2024			August 2025			June 2030
Par value (in millions)	$	400.0		$	350.0		$	350.0
Stated coupon	4.25		%	3.50		%	3.30		%
Coupon frequency	Semi-annually			Semi-annually			Semi-annually
Potential call date	Any time			Any time			Any time
Call price	As defined			As defined			As defined

The senior notes may be redeemed, in whole or in part, at any time, in the case of the 2024 and 2025 senior notes, and at any time prior to March 15, 2030, in the case of the 2030 senior notes. In each case, the senior notes may be redeemed at a make-whole redemption price, plus accrued and unpaid interest. The make-whole redemption price, in each case, is equal to the greater of 100% of the principal amount of the notes to be redeemed and the remaining principal and interest payments on the notes being redeemed (excluding accrued but unpaid interest to, but not including, the redemption date) discounted to their present value as of the redemption date at the applicable treasury rate plus 0.25%, in the case of the 2024 and the 2025 senior notes, and to their present value as of the redemption date on a semi-annual basis at the applicable treasury rate plus 0.40%, in the case of the 2030 senior notes.

Junior Subordinated Notes

As of June 30, 2023, the Company had junior subordinated notes outstanding, the respective principal terms of which are presented below:

	2059 Junior Subordinated Notes			2060 Junior Subordinated Notes			2061 Junior Subordinated Notes
Issue date	March 2019			September 2020			July 2021
Maturity date	March 2059			September 2060			September 2061
Par value (in millions)	$	300.0		$	275.0		$	200.0
Stated coupon	5.875		%	4.75		%	4.20		%
Coupon frequency	Quarterly			Quarterly			Quarterly
Potential call date	March 2024			September 2025			September 2026
Call price	As defined			As defined			As defined
Listing	NYSE			NYSE			NYSE

The junior subordinated notes may be redeemed at any time, in whole or in part, on or after March 30, 2024, in the case of the 2059 junior subordinated notes, on or after September 30, 2025, in the case of the 2060 junior subordinated notes, and on or after September 30, 2026, in the case of the 2061 junior subordinated notes. In each case, the junior subordinated notes may be redeemed at 100% of the principal amount of the notes being redeemed, plus any accrued and unpaid interest thereon.  Prior to the applicable redemption date, at the Company’s option, the applicable junior subordinated notes may also be redeemed, in whole but not in part, at 100% of the principal amount, plus any accrued and unpaid interest, if certain changes in tax laws, regulations, or interpretations occur; or at 102% of the principal amount, plus any accrued and unpaid interest, if a rating agency makes certain changes relating to the equity credit criteria for securities with features similar to the applicable notes.

The Company may, at its option, and subject to certain conditions and restrictions, defer interest payments subject to the terms of the junior subordinated notes.

Junior Convertible Securities

As of June 30, 2023, the Company had $341.7 million of principal outstanding in its 5.15% junior convertible trust preferred securities (the “junior convertible securities”), maturing in 2037. The junior convertible securities bear interest at a rate of 5.15% per annum, payable quarterly in cash.

As of December 31, 2022 and June 30, 2023, the unamortized issuance costs related to the junior convertible securities were $3.1 million and $3.0 million, respectively.

The following table presents interest expense recognized in connection with the junior convertible securities:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2023		2022		2023
Contractual interest expense	$	4.5	$	4.4	$	9.5	$	8.8
Amortization of debt issuance costs	0.1		0.1		0.1		0.1
Total	$	4.6	$	4.5	$	9.6	$	8.9

Effective interest rate 5.20  % 5.21  % 5.21  % 5.21  %

Holders of the junior convertible securities have no rights to put these securities to the Company. The holder may convert the securities to 0.2558 shares of common stock per $50.00 junior convertible security, equivalent to an adjusted conversion price of $195.47 per share. The conversion rate is subject to adjustments as described in the Amended and Restated Declaration of Trust of AMG Capital Trust II and the related indenture, both dated October 17, 2007 and filed as exhibits to the Company’s most recent Annual Report on Form 10-K. Upon conversion, holders will receive cash or shares of the Company’s common stock, or a combination thereof, at the Company’s election. The Company may redeem the junior convertible securities if the closing price of its common stock for 20 trading days in a period of 30 consecutive trading days exceeds 130% of the then prevailing conversion price, and may also repurchase junior convertible securities in the open market or in privately negotiated transactions from time to time at management’s discretion. During the six months ended June 30, 2022, the Company

repurchased a portion of its junior convertible securities for a purchase price of $60.9 million and as a result of these repurchases, the Company reduced its Deferred income tax liability (net) by $11.7 million. The Company did not repurchase any of its junior convertible securities during the six months ended June 30, 2023.