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DEBT
12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
DEBT DEBT
Long-term debt comprises the following (in thousands):
December 31,
 20222021
Senior secured term loan A $455,313 $467,062 
Senior secured term loan B 335,625 349,125 
Senior secured revolving credit facility140,300 19,300 
Unamortized discount on term loan B and deferred debt issuance costs(5,977)(7,361)
Total debt925,261 828,126 
Current portion of long-term debt(18,188)(15,250)
Total long-term debt$907,073 $812,876 
Senior Secured Credit Facilities
On September 2, 2021, the Company entered into a new credit agreement (the “2021 Credit Agreement”), which permits borrowings and other extensions of credit in an initial aggregate principal amount of up to $1 billion (as may be increased from time to time in accordance with the terms). Prior to September 2, 2021, the Company was party to an amended and restated credit agreement, dated as of October 27, 2015. The 2021 Credit Agreement governs the Company’s senior secured credit facilities (the “Senior Secured Credit Facilities”), which consist of a five-year $400 million revolving credit facility (the “Revolving Credit Facility”), a five-year “term A” loan (the “TLA Facility”) and a seven-year “term B” loan (the “TLB Facility” and, together with the TLA Facility, the “Term Loan Facilities”). The TLB Facility was issued at a 0.50% discount. The 2021 Credit Agreement also includes an alternative benchmark rate as a replacement to the London Interbank Offered Rate (“LIBOR”) in the event LIBOR is no longer available. As of December 31, 2022, the weighted average interest rate on all outstanding borrowings was 6.40%.
The obligations under the 2021 Credit Agreement are guaranteed by certain specified subsidiaries of the Company. Among other things, the 2021 Credit Agreement contains covenants that restrict the Company’s and certain of its subsidiaries’ ability to incur liens on certain assets, incur indebtedness, make material changes in corporate structure or materially alter the nature of its business, dispose of material assets, engage in mergers, consolidations and certain other fundamental changes, or engage in certain transactions with affiliates. The 2021 Credit Agreement contains customary default provisions, including, but not limited to, failure to pay interest or principal when due and failure to comply with covenants.
Refer to Note 21, “Subsequent Events,” for information regarding the January 30, 2023 and February 15, 2023 amendments to the 2021 Credit Agreement, the January 31, 2023 Capped Call Transactions and the February 3, 2023 Convertible Notes offering.
Revolving Credit Facility
The Revolving Credit Facility matures on September 2, 2026 and includes a $40 million sublimit for swingline loans and standby letters of credit. As of December 31, 2022, the Company had available borrowing capacity on the Revolving Credit Facility of $256.2 million after giving effect to $140.3 million of outstanding borrowings and $3.5 million of outstanding standby letters of credit.
Interest rates on the Revolving Credit Facility are at the Company’s option, either at: (i) the applicable LIBOR (or an applicable benchmark replacement) plus the applicable margin, which will range between 1.25% and 2.25%, based on the Company’s Total Net Leverage Ratio (as defined in the 2021 Credit Agreement), or (ii) the Base Rate (as defined below) plus the applicable margin, which will range between 0.25% and 1.25%, based on the Company’s Total Net Leverage Ratio. The Base Rate is defined, for any day, as the per annum rate equal to the highest of (i) the prime rate (as defined in the 2021 Credit Agreement), (ii) the Federal Funds Rate, as published by the Federal Reserve Bank of New York, plus 0.50%, and (iii) one-month LIBOR plus 1.00%. As of December 31, 2022, the interest rate on outstanding borrowings under the Revolving Credit Facility was 6.13%.
The Company is required to pay a commitment fee on the unused portion of the Revolving Credit Facility, which will range between 0.15% and 0.25%, depending on the Company’s Total Net Leverage Ratio. As of December 31, 2022, the commitment fee on the unused portion of the Revolving Credit Facility was 0.20%.
(8.)     DEBT (Continued)
Term Loan Facilities
The TLA Facility and TLB Facility mature on September 2, 2026 and September 2, 2028, respectively, and require quarterly installments. The quarterly principal installments under the TLA Facility increase over the term of the loan. The interest rate terms for the TLA Facility are the same as those outlined above for the Revolving Credit Facility. Interest rates on the TLB Facility are, at the Company’s option, either at: (i) the applicable LIBOR rate plus 2.50%, with LIBOR subject to a 0.50% floor, or (ii) the Base Rate plus 1.50%. As of December 31, 2022, the interest rates on the TLA Facility and TLB Facility were 6.13% and 6.88%, respectively.
Covenants
The 2021 Credit Agreement contains customary terms and conditions, including representations and warranties and affirmative and negative covenants, as well as financial covenants for the benefit of the lenders under the Revolving Credit Facility and the TLA Facility, which require that (i) the Company maintain a Total Net Leverage Ratio not to exceed 5.50:1.00 (stepping down to 5.00:1.00 for the third fiscal quarter of 2023 through maturity and subject to increase in certain circumstances following qualified acquisitions, but shall not exceed 5.50:1.00) and (ii) the Company maintain an interest coverage ratio of at least 2.50:1.00. The TLB Facility does not contain any financial maintenance covenants. As of December 31, 2022, the Company was in compliance with these financial covenants.
Contractual maturities under the Senior Secured Credit Facilities for the next five years and thereafter, as of December 31, 2022, are as follows (in thousands):
20232024202520262027After 2027
Future minimum principal payments$18,188 $29,937 $38,750 $522,738 $3,500 $318,125 
Deferred Debt Issuance Costs and Discounts
The change in deferred debt issuance costs related to the Company’s Revolving Credit Facility is as follows (in thousands):
December 31, 20213,039 
Amortization during the period(652)
December 31, 2022$2,387 
The change in unamortized discount and deferred debt issuance costs related to the Term Loan Facilities is as follows (in thousands):
Deferred Debt Issuance CostsUnamortized Discount on TLB FacilityTotal
December 31, 20215,674 1,687 7,361 
Write-off of deferred debt issuance costs and unamortized discount(114)— (114)
Amortization during the period(991)(279)(1,270)
December 31, 2022$4,569 $1,408 $5,977