Debt

12 Months Ended

Dec. 31, 2019

The following table summarizes the Company’s Debt:



	December 31,
	2018		2019
Senior bank debt	$	779.7	$	449.7
Senior notes	742.5		743.8
Junior convertible securities	307.4		310.6
Junior subordinated notes	—		289.7
Debt	$	1,829.6	$	1,793.8

Long-term debt is carried at amortized cost. Unamortized discounts and debt issuance costs related to long-term debt are presented in the Consolidated Balance Sheets as an adjustment to the carrying value of the associated long-term debt. As of December 31, 2019, Debt with a par value of $450.0 million and $400.0 million matures in 2023 and 2024, respectively.

Senior Bank Debt

In 2019, the Company amended and restated its existing credit facilities to provide for a $1.25 billion senior unsecured multicurrency revolving credit facility and a $450.0 million senior unsecured term loan facility. The revolver matures on January 18, 2024, and the term loan matures on January 18, 2023. Subject to certain conditions, the Company may increase the commitments under the revolver by up to an additional $500.0 million and may borrow up to an additional $75.0 million under the term loan. The Company pays interest on any outstanding obligations under the credit facilities at specified rates, based either on an applicable LIBOR or prime rate, plus a marginal rate determined based on its credit rating. As of December 31, 2019, the interest rate for the Company’s outstanding borrowings under the credit facilities was LIBOR plus 0.875%.

The credit facilities contain financial covenants with respect to leverage and interest coverage, as well as customary affirmative and negative covenants, including limitations on priority indebtedness, asset dispositions and fundamental corporate changes, and certain customary events of default.

As of December 31, 2018, the Company had outstanding borrowings under the revolver of $330.0 million, and the weighted-average interest rate on outstanding borrowings was 3.92%. As of December 31, 2019, the Company had no outstanding borrowings under the revolver. As of December 31, 2018 and 2019, the Company had outstanding borrowings under the term loan of $450.0 million, and the weighted-average interest rate on outstanding borrowings was 3.33% and 2.66%, respectively. The Company pays commitment fees on the unused portion of its revolver. For the years ended December 31, 2018 and 2019, these fees amounted to $1.6 million and $1.5 million, respectively.

Senior Notes and Junior Subordinated Notes

As of December 31, 2019, the Company had senior notes and junior subordinated notes outstanding. The carrying value of the senior notes and junior subordinated notes is accreted to the principal amount at maturity over the remaining life of the

underlying instrument.

The principal terms of the senior notes and junior subordinated notes were as follows:

2024
Senior Notes

2025
Senior Notes

2059

Junior Subordinated Notes

Issue date

February 2014

February 2015

March 2019

Maturity date

February 2024

August 2025

March 2059

Par value (in millions)

400.0

350.0

300.0

Stated coupon

4.25

3.50

5.875

Coupon frequency

Semi-annually

Quarterly⁽³⁾

Potential call date

Any time⁽¹⁾

March 2024⁽²⁾

Call price

As defined⁽¹⁾

As defined⁽²⁾

Listing

N.A.

NYSE

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⁽¹⁾

The senior notes may be redeemed at any time, in whole or in part, at a make-whole redemption price plus accrued and unpaid interest. The make-whole redemption price, in each case, is equal to the greater of 100% of the principal amount of the notes to be redeemed and the remaining principal and interest payments on the notes being redeemed (excluding accrued but unpaid interest to, but not including, the redemption date) discounted to their present value as of the redemption date at the applicable treasury rate plus 0.25%.

⁽²⁾

The junior subordinated notes may be redeemed at any time, in whole or in part, on or after March 30, 2024, at 100% of the principal amount of the notes being redeemed plus any accrued and unpaid interest thereon. Prior to March 30, 2024, the junior subordinated notes may also be redeemed, in whole but not in part, at 100% of the principal amount, plus any accrued and unpaid interest, if certain changes in tax laws, regulations or interpretations occur; or at 102% of the principal amount, plus any accrued and unpaid interest, if a rating agency makes certain changes relating to the equity credit criteria for securities with features similar to the junior subordinated notes.


⁽³⁾	The Company may, at its option, and subject to certain conditions and restrictions, defer interest payments subject to the terms of the junior subordinated notes.

As of December 31, 2019, the effective interest rates of the 2024 senior notes, the 2025 senior notes and the 2059 junior subordinated notes were 4.42%, 3.66% and 5.96%, respectively.

Junior Convertible Securities

The following table summarizes the Company’s junior convertible trust preferred securities outstanding (the “junior convertible securities”). The carrying value and principal amount at maturity of the junior convertible securities were as follows:



	December 31, 2018				December 31, 2019
	Carrying Value		Principal Amount at Maturity		Carrying Value		Principal Amount at Maturity
Junior convertible securities⁽¹⁾	$	312.5	$	430.8	$	315.4	$	430.8

__________________________


⁽¹⁾	The carrying value is accreted to the principal amount at maturity over a remaining life of 18 years.

The junior convertible securities bear interest at a rate of 5.15% per annum, payable quarterly in cash. Holders of the junior convertible securities have no rights to put these securities to the Company. Upon conversion, holders will receive cash or shares of common stock, or a combination thereof, at the Company’s election. The junior convertible securities are considered contingent payment debt instruments under federal income tax regulations, which require the Company to deduct interest in an amount greater than its reported interest expense. These deductions will generate annual deferred tax liabilities of $8.4 million. These deferred tax liabilities will be reclassified directly to stockholders’ equity if the Company’s common stock is trading above certain thresholds at the time of the conversion of the securities. In August 2019, in accordance with the

convertible securities indenture, the Company adjusted the conversion rate of the junior convertible securities to 0.2558 shares of common stock per $50.00 junior convertible security, equivalent to an adjusted conversion price of $195.47 per share of common stock. The adjustment was the result of the Company’s cumulative declared dividends on its common stock since the prior adjustment. The Company may red