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Debt | 9 Months Ended
--- | ---
Mar. 31, 2025
Debt Disclosure [Abstract] |
Debt | Debt Long-term debt consisted of the following (in thousands):
|  | March 31, 2025 |  | June 30, 2024
Bank credit facility – term loans |  | $ | 1,087,188 |  |  | $ | 1,133,125 |
Bank credit facility – revolver loans |  | 1,290,000 |  |  | 415,000 |
Term loan B facility |  | 748,125 |  |  | — |
Principal amount of long-term debt |  | 3,125,313 |  |  | 1,548,125 |
Less unamortized discounts and debt issuance costs |  | (13,157) |  |  | (5,488) |
Total long-term debt |  | 3,112,156 |  |  | 1,542,637 |
Less current portion |  | (68,750) |  |  | (61,250) |
Long-term debt, net of current portion |  | $ | 3,043,406 |  |  | $ | 1,481,387 |
Bank Credit Facility On December 13, 2021, the Company amended its credit facility (the Credit Facility) primarily to extend the maturity date, increase borrowing capacity, and improve pricing. As amended, the Company’s $3,200.0 million Credit Facility consists of a $1,975.0 million revolving credit facility (the Revolving Facility) and a $1,225.0 million term loan (the Term Loan). The Revolving Facility has subfacilities of $100.0 million for same-day swing line loan borrowings and $25.0 million for stand-by letters of credit. The Revolving Facility is a secured facility that permits continuously renewable borrowings of up to $1,975.0 million. As of March 31, 2025, the Company had $1,290.0 million outstanding under the Revolving Facility and no borrowings on the swing line. The Company pays a quarterly facility fee for the unused portion of the Revolving Facility. The Term Loan is a five-year secured facility under which principal payments are due in quarterly installments of $7.7 million through December 31, 2023 and $15.3 million thereafter until the balance is due in full on December 13, 2026. As of March 31, 2025, the Company had $1,087.2 million outstanding under the Term Loan. The interest rates applicable to loans under the Credit Facility are floating interest rates that, at the Company’s option, equal a base rate or a Secured Overnight Financing Rate (SOFR) rate plus, in each case, an applicable margin based upon the Company’s consolidated total net leverage ratio. For the three months ended March 31, 2025, the effective interest rate, including the impact of the Company’s floating-to-fixed interest rate swap agreements and excluding the effect of amortization of debt financing costs, for the outstanding borrowings under the Credit Facility was 5.26%. The Credit Facility requires the Company to comply with certain financial covenants, including a maximum total leverage ratio and a minimum interest coverage ratio. The Credit Facility also includes customary negative covenants restricting or limiting the Company’s ability to guarantee or incur additional indebtedness, grant liens or other security interests to third parties, make loans or investments, transfer assets, declare dividends or redeem or repurchase capital stock or make other distributions, prepay subordinated indebtedness and engage in mergers, acquisitions or other business combinations, in each case except as expressly permitted under the Credit Facility. As of March 31, 2025, the Company was in compliance with all of the financial covenants. A majority of the Company’s assets serve as collateral under the Credit Facility. All debt issuance costs are being amortized from the date incurred to the expiration date of the Credit Facility. Term Loan B Facility To provide additional financial flexibility for the Company, in connection with the Azure Summit acquisition, the Company entered into a commitment letter (the “Commitment Letter”), dated September 10, 2024, with JPMorgan Chase Bank, N.A. (“JPMorgan”), pursuant to which JPMorgan committed to provide the entire principal amount of a senior secured bridge loan facility in an aggregate principal amount of up to $750.0 million. No amounts were funded pursuant to the Commitment Letter. On October 30, 2024 the Company completed a new senior secured Term Loan B facility in an aggregate principal amount of $750.0 million, which effectively terminated the Commitment Letter. The Term Loan B facility is a seven-year facility under which principal payments are due in quarterly installments of $1.9 million from March 2025 until the balance is due in full at maturity in October 2031. The interest rates applicable to the Term Loan B facility are floating interest rates that, at the Company’s option, equal a base rate or a term SOFR rate plus an applicable margin. The Company recognized $9.8 million of debt discount and debt issuance costs related to the Term Loan B financing, which were recorded as an offset against the carrying value of debt and are being amortized to interest expense over the life of the Term Loan B facility using the effective interest method. Cash Flow Hedges The Company periodically uses derivative financial instruments as part of a strategy to manage exposure to market risks associated with interest rate fluctuations. The Company has entered into several floating-to-fixed interest rate swap agreements for an aggregate notional amount of $1,000.0 million which hedge a portion of the Company’s floating rate indebtedness. The swaps mature at various dates through 2028. The Company has designated the swaps as cash flow hedges. Unrealized gains are recognized as assets while unrealized losses are recognized as liabilities. The interest rate swap agreements are highly correlated to the changes in interest rates to which the Company is exposed. Realized gains and losses in connection with each required interest payment are reclassified from accumulated other comprehensive income or loss to interest expense. The Company does not hold or issue derivative financial instruments for trading purposes. The effect of derivative instruments in the consolidated statements of operations and accumulated other comprehensive loss for the three and nine months ended March 31, 2025 and 2024 is as follows (in thousands):
|  | Three Months Ended March 31, |  | Nine Months Ended March 31,
|  | 2025 |  | 2024 |  | 2025 |  | 2024
Gain (loss) recognized in other comprehensive income |  | $ | (2,399) |  |  | $ | 14,252 |  |  | $ | (1,057) |  |  | $ | 14,130 |
Amounts reclassified to earnings from accumulated other comprehensive loss |  | (3,490) |  |  | (6,879) |  |  | (14,046) |  |  | (20,547) |
Other comprehensive income (loss), net of tax |  | $ | (5,889) |  |  | $ | 7,373 |  |  | $ | (15,103) |  |  | $ | (6,417) |

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481544/470-10-50-6 Reference 2: 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