Note 15 - Long-term Debt and Credit Arrangements

9 Months Ended

Sep. 30, 2022

Notes to Financial Statements

Long-Term Debt [Text Block]

15.  Long-Term Debt and Credit Arrangements

(in thousands)	September 30, 2022		December 31, 2021		September 30, 2021
2.75% Convertible Notes	$	230,000	$	207,354	$	205,543
Third Amended and Restated Credit Agreement - term loan		—		123,750		125,625
Fourth Amended and Restated Credit Agreement - revolver		50,000		—		—
Debt issuance costs and other		8,310		8,814		8,742
Total debt	$	288,310	$	339,918	$	339,910
Less current maturities		1,438		8,727		8,718
Total long-term debt	$	286,872	$	331,191	$	331,192

During the first half of 2022, we prepaid 100% of our outstanding term loan and replaced the Third Amended and Restated Credit Agreement dated May 31, 2018 with the Fourth Amended and Restated Credit Agreement (the “Credit Agreement”) maturing June 2, 2027. The Credit Agreement is a $350.0 million senior secured, five-year revolving facility (the “Revolver”), including an accordion feature allowing us to increase borrowings up to the greater of (a) $200.0 million and (b) 100% of twelve-month trailing EBITDA, subject to lender approval. The Credit Agreement includes a $150.0 million sublimit for letters of credit ($75.0 million for financial letters of credit) and a $20.0 million sublimit for swingline loans.

We may borrow on the Revolver, at our option, at either (a) the SOFR term rate plus a credit adjustment spread plus applicable margin ranging from 1.0% to 2.0%, or (b) a base rate plus an applicable margin ranging from 0.0% to 1.0%. The applicable margin is based on our Consolidated Leverage Ratio (as defined in our Credit Agreement), calculated quarterly. As of  September 30, 2022, the total unused availability under the Credit Agreement was $267.0 million, resulting from $33.0 million in issued and outstanding letters of credit and $50.0 million drawn under the Revolver. The letters of credit had expiration dates between November 2022 and  December 2025. As of September 30, 2022, the applicable rate was 1.8% for loans under the Credit Agreement bearing interest based on SOFR and 0.8% for loans bearing interest at the base rate. Accordingly, the effective interest rates at  September 30, 2022 for SOFR and base rate loans were 4.9% and 7.0%, respectively.

The amended Credit Agreement contains certain affirmative and restrictive covenants, and customary events of default. The financial covenants include a maximum Consolidated Leverage Ratio (as defined in the Credit Agreement) of 3.25 to 1.00 and a minimum Consolidated Interest Coverage Ratio (as defined in the Credit Agreement) of 3.00 to 1.00. As of September 30, 2022, the Consolidated Leverage Ratio was 1.89, which did not exceed the maximum of 3.25. Our Consolidated Interest Coverage Ratio was 10.15, which was above the minimum of 3.00.

Effective January 1, 2022, we adopted ASU 2020-06 (see Note 2), which updated our accounting for the 2.75% Convertible Notes.

During the three and nine months ended September 30, 2022, we did not record amortization of the debt discount due to the implementation of ASU 2020-06, and during the three and nine months ended September 30, 2021, we recorded $1.7 million and $5.2 million, respectively, of amortization of the debt discount. During the three and nine months ended September 30, 2022 and 2021, we recorded $0.3 million, $1.0 million, $0.6 million and $1.8 million, respectively, of amortization related to debt issuance costs.