Note 14 - Long-term Debt and Credit Arrangements

9 Months Ended

Sep. 30, 2019

Notes to Financial Statements

Long-term Debt [Text Block]

14.  Long-Term Debt and Credit Arrangements

(in thousands)	September 30, 2019		December 31, 2018			September 30, 2018
Senior notes payable	$	—	$	40,000		$	80,000
Credit Agreement term loan		140,625		146,250			148,125
Credit Agreement revolving credit loan		250,000		197,000			137,000
Convertible notes		—		—			69,659
Other		12,479		(845	)		(1,062	)
Total debt		403,104		382,405			433,722
Less current maturities		8,263		47,286			116,796
Total long-term debt	$	394,841	$	335,119		$	316,926

The aggregate minimum principal maturities of long-term debt, including current maturities and excluding debt issuance costs, related to balances at September 30, 2019 are as follows: $2.1 million during the remainder of 2019; $8.4 million in 2020; $8.5 million in 2021; $8.5 million in 2022; $367.3 in 2023 and $8.9 million in 2024 and thereafter.

Senior Notes Payable

Senior notes payable as of  December 31, 2018 and September 30, 2018 of $40.0 million and $80.0 million, respectively, were due to a group of institutional holders and had an interest rate of 6.11% per annum (“2019 Notes”). As of December 31, 2018, all of the $40.0 million was included in current maturities of long-term debt on the condensed consolidated balance sheets. As of September 30, 2018, $40.0 million of the outstanding balance was included in each of current maturities of long-term debt and long-term debt in the condensed consolidated balance sheets. On July 29, 2019, we called and redeemed the $40.0 million outstanding balance which were originally due in December 2019. 

Credit Agreement

Granite entered into the Third Amended and Restated Credit Agreement dated May 31, 2018. The credit agreement provided for a $150.0 million term loan, of which $140.6 million was outstanding on September 30, 2019, and a $350.0 million revolving credit facility. We entered into Amendment No. 1 to Third Amended and Restated Credit Agreement (as amended, the “Credit Agreement”) dated July 29, 2019 as discussed below.

The term loan requires that Granite repay 1.25% of the principal balance each quarter until the maturity date, at which point the remaining balance is due. As of each September 30, 2019, December 31, 2018 and September 30, 2018, $7.5 million of the term loan balance was included in current maturities of long-term debt on the condensed consolidated balance sheets and the remaining $133.1 million, $138.8 million and $140.6 million, respectively, was included in long-term debt.

As of September 30, 2019, the total stated amount of all issued and outstanding letters of credit under the Credit Agreement was $32.3 million. As of September 30, 2019, December 31, 2018 and  September 30, 2018, $250.0 million, $197.0 million and $137.0 million, respectively, was outstanding under the revolving credit facility. As of September 30, 2019, the total unused availability under the Credit Agreement was $67.7 million. The letters of credit will expire between October 2019 and June 2020.

Borrowings under the Credit Agreement bear interest at LIBOR or a base rate (at our option), plus an applicable margin based on the Consolidated Leverage Ratio (as defined in the Credit Agreement) calculated quarterly. The applicable margin was 2.00% for loans bearing interest based on LIBOR and 1.00% for loans bearing interest at the base rate at September 30, 2019. Accordingly, the effective interest rate using three-month LIBOR and base rate was 4.09% and 6.00%, respectively, at September 30, 2019 and we elected to use LIBOR for both the term loan and the revolving credit facility.

As of September 30, 2019, the conditions for the exercise of our right under Credit Agreement to have liens released were not satisfied.

Covenants and Events of Default

Our Credit Agreement requires us to comply with various affirmative, restrictive and financial covenants. Our failure to comply with any of these covenants, or to pay principal, interest or other amounts when due thereunder, would constitute an event of default under the Credit Agreement. As of September 30, 2019, we were compliant with the financial covenants contained in the Credit Agreement.