Long-Term Debt

9 Months Ended

Sep. 30, 2019

LONG-TERM DEBT

Long-term debt consisted of the following:



In millions	September 30, 2019		December 31, 2018
Floating Senior Notes, due 2021, net of unamortized debt issuance costs of $2.3 and $3.2	$	497.7	$	496.8
4.15% Senior Notes, due 2024, net of unamortized debt issuance costs of $6.0 and $7.0	744.0		743.0
4.70% Senior Notes, due 2028, net of unamortized debt issuance costs of $9.5 and $10.3	1,240.5		1,239.7
3.45% Senior Notes, due 2026, net of unamortized debt issuance costs of $1.5 and $1.7	748.5		748.3
4.375% Senior Notes, due 2023, net of unamortized discount and debt issuance costs of $1.0 and $1.2	249.0		248.8
Revolving Credit Facility, net of unamortized debt issuance costs of $2.3 and $3.1	1,217.4		338.1
Other Borrowings	48.2		42.2
Total	4,745.3		3,856.9
Less: current portion	111.8		64.1
Long-term portion	$	4,633.5	$	3,792.8

On September 14, 2018, the Company issued $2.5 billion of senior notes with three different maturities.

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Floating Rate Senior Notes due 2021 - The Company issued $500.0 million of Floating Rate Senior Notes due 2021 (the "Floating Rate Notes"). The Floating Rate Notes, which are non-callable for one year, were issued at 100% of face value. Interest on the Floating Rate Notes accrues at a floating rate per annum equal to three-month Libor plus 105 basis points. The interest rate for the Floating Rate Notes for the initial interest period was 3.3815%, which was determined on September 12, 2018. Interest on the Floating Rate Notes is payable quarterly on December 15, March 15, June 15, and September 15 of each year. The Company incurred $3.5 million of deferred financing costs related to the issuance of the Floating Rate Notes.

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4.15% Senior Notes due 2024 - The Company issued $750.0 million of 4.15% Senior Notes due 2024 (the "2024 Notes"). The 2024 Notes were issued at 99.805% of face value. Interest on the 2024 Notes accrues at a rate of 4.15% per annum and is payable semi-annually on March 15 and September 15 of each year. The Company incurred $7.4 million of deferred financing costs related to the issuance of the 2024 Notes.

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4.70% Senior Notes Due 2028 - The Company issued $1,250.0 million of 4.70% Senior Notes due 2028 (the "2028 Notes" and together with the Floating Rate Notes and 2024 Notes, the "2018 Notes"). The 2028 Notes were issued at 99.889% of face value. Interest on the 2028 Notes accrues at a rate of 4.70% per annum and is payable semi-annually on March 15 and September 15 of each year. The Company incurred $10.6 million of deferred financing costs related to the issuance of the 2028 Notes.

The net proceeds from the issuance and sale of the 2018 Notes were used to finance the cash portion of the GET Merger Transactions. The principal balances are due in full at maturity.

On February 12, 2019, the rating assigned by Moody's was decreased to Ba1. Accordingly, pursuant to the respective terms of the 2018 Notes issued on September 14, 2018, the interest rate increased by 0.25%. The interest rate increase took effect during the interest period following February 12, 2019.

3.45% Senior Notes Due November 2026

On November 3, 2016, the Company issued $750.0 million of 3.45% Senior Notes due in 2026 (the "2016 Notes"). The 2016 Notes were issued at 99.965% of face value. Interest on the 2016 Notes accrues at a rate of 3.45% per annum and is payable semi-annually on May 15 and November 15 of each year. The net proceeds from the issuance of the 2016 Notes were used to finance the cash portion of the purchase price for the Company's acquisition of Faiveley Transport, S.A. ("Faiveley Transport"), refinance Faiveley Transport's indebtedness, and for general corporate purposes. The principal balance is due in full at maturity. The Company incurred $2.7 million of deferred financing costs related to the issuance of the 2016 Notes.

4.375% Senior Notes Due August 2023

On August 8, 2013, the Company issued $250.0 million of 4.375% Senior Notes due in 2023 (the “2013 Notes”, and together with the 2016 Notes and the 2018 Notes, the "Senior Notes"). The 2013 Notes were issued at 99.879% of face value. Interest on the 2013 Notes accrues at a rate of 4.375% per annum and is payable semi-annually on February 15 and August 15 of each year. The net proceeds from the issuance of the 2013 Notes were used to repay debt outstanding under the Company’s then-existing credit agreement, and for general corporate purposes. The principal balance is due in full at maturity. The Company incurred $2.6 million of deferred financing costs related to the issuance of the 2013 Notes.

The Senior Notes are senior unsecured obligations of the Company and rank pari passu with all existing and future senior debt and senior to all existing and future subordinated indebtedness of the Company. The Senior Notes are guaranteed on an unsecured basis by each of the Company’s subsidiaries that guarantees the 2018 Refinancing Credit Agreement (as defined below). The indentures under which the Senior Notes were issued provide that the Company must make an offer to repurchase in connection with certain change of control triggering events and contains covenants and restrictions which limit among other things, the following: the incurrence of debt secured by certain liens, the entry into certain sale and leaseback transactions, and the ability to consolidate with or merge into other entities or sell all or substantially all of the Company’s assets.

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.

2018 Refinancing Credit Agreement

On June 8, 2018, the Company entered into a credit agreement (the “2018 Refinancing Credit Agreement”), which replaced the credit facility, which comprised a $1.2 billion, 5 year revolving credit facility (the "2016 Revolving Facility") and a $400.0 million delayed draw term loan (the "2016 Term Loan"). As part of the 2018 Refinancing Credit Agreement, the Company entered into (i) a $1.2 billion revolving credit facility (the “Revolving Credit Facility”), which replaced the 2016 Revolving Facility, and includes a letter of credit sub-facility of up to $450.0 million and a swing line sub-facility of $75.0 million, (ii) a $350.0 million term loan (the “Refinancing Term Loan”), which refinanced the 2016 Term Loan, and (iii) a new $400.0 million delayed draw term loan (the “Delayed Draw Term Loan”, and together with the Refinancing Term Loan, the "Term Loan"). The 2018 Refinancing Credit Agreement also provided for a bridge loan facility (the “Bridge Loan Facility”) in an amount not to exceed $2.5 billion, which would only become effective at the Company’s request. Commitments in respect of the Bridge Loan Facility were terminated upon the issuance and sale of the 2018 Notes on September 14, 2018. In addition, the 2018 Refinancing Credit Agreement contains an uncommitted accordion feature allowing the Company to request, in an aggregate amount not to exceed $600.0 million, increases to the borrowing commitments under the Revolving Credit Facility or a new incremental term loan commitment. At September 30, 2019, the Company had approximately $656.0 million of available bank borrowing capacity subject to certain financial covenant restrictions, net of $29.3 million of letters of credit.

The Revolving Credit Facility matures on June 8, 2023 and is unsecured. The Refinancing Term Loan matures on June 8, 2021 and is unsecured. The Delayed Draw Term Loan was initially drawn on February 25, 2019, matures on February 25, 2022, and is unsecured. The Company incurred a 17.5 basis point commitment fee from June 8, 2018 until the initial draw. The applicable interest rate for borrowings under the 2018 Refinancing Credit Agreement includes interest rate spreads based on the lower of the pricing corresponding to (i) the Company’s ratio of total debt (less unrestricted cash up to $300.0 million) to EBITDA (“Leverage Ratio”) or (ii) the Company’s public rating, in each case that range between 1.000% and 1.875% for LIBOR/CDOR-based borrowings and 0.0% and 0.875% for Alternate Base Rate based borrowings. The obligations of the Company under the 2018 Refinancing Credit Agreement have been guaranteed by certain of the Company’s subsidiaries.

The 2018 Refinancing Credit Agreement contains customary representations and warranties by the Company and its subsidiaries, including customary use of materiality, material adverse effect, and knowledge qualifiers. The Company and its subsidiaries are also subject to (i) customary affirmative covenants that impose certain reporting obligations on the Company and its subsidiaries and (ii) customary negative covenants, including limitations on: indebtedness; liens; restricted payments; fundamental changes; business activities; transactions with affiliates; restrictive agreements; changes in fiscal year; and use of proceeds. In addition, the Company is required to maintain (i) an Interest Coverage ratio at least 3.00 to 1.00 over each period of four consecutive fiscal quarters ending on the last day of a fiscal quarter and (ii) a Leverage Ratio, calculated as of the last day of a fiscal quarter for a period of four consecutive fiscal quarters, of 3.25 to 1.00 or less; provided that, in the event the Company completes the Direct Sale and the Merger or any other material acquisition in which the cash consideration paid exceeds $500.0 million, the maximum Leverage Ratio permitted will be 3.75 to 1.00 at the end of the fiscal quarter in which such acquisition is consummated and each of the three fiscal quarters immediately following such fiscal quarter and 3.50 to 1.00 at the end of each of the fourth and fifth full fiscal quarters after the consummation of such acquisition. The Company is in compliance with the restrictions and covenants of the 2018 Refinancing Credit Agreement and does not expect that these measurements will limit the Company in executing its operating activities.

The obligations under the 2018 Refinancing Credit Agreement are fully and unconditionally guaranteed by certain of the Company’s U.S. subsidiaries.

At September 30, 2019, the weighted average interest rate on the Company’s variable rate debt was 3.14%. On June 5, 2014, the Company entered into a forward starting interest rate swap agreement with a notional value of $150.0 million. The effective date of the interest rate swap agreement was November 7, 2016, and the termination date was December 19, 2018.

2016 Refinancing Credit Agreement

On June 22, 2016, the Company amended its existing revolving credit facility with a consortium of commercial banks. This 2016 Refinancing Credit Agreement provided the Company with a $1.2 billion, 5 year revolving credit facility and a $400.0 million delayed draw term loan (the “2016 Term Loan”). The Company incurred approximately $3 million of deferred financing cost related to the 2016 Refinancing Credit Agreement. The 2016 Refinancing Credit Agreement borrowings bore variable interest rates indexed as described below.

Under the 2016 Refinancing Credit Agreement, the Company could elect a Base Rate of interest for U.S. Dollar denominated loans or, for certain currencies, an interest rate based on the London Interbank Offered Rate (“LIBOR”) of interest, or other rates appropriate for such currencies (in any case, “the Alternate Rate”). The Base Rate adjusted on a daily basis and was the greater of the Federal Funds Effective Rate plus 0.50% per annum, the PNC, N.A. prime rate or the Daily LIBOR Rate plus 100 basis points, plus a margin that ranged from 0 to 75 basis points. The Alternate Rate was based on the quoted rates specific to the applicable currency, plus a margin that ranged from 75 to 175 basis points. Both the Base Rate and Alternate Rate margins were dependent on the Company’s consolidated total indebtedness to EBITDA ratios. The initial Base Rate margin was 0 basis points and the Alternate Rate margin is 175 basis points.