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Notes and Contracts Payable
 12 Months Ended
Dec. 31, 2021
Debt Disclosure [Abstract]  
Notes and Contracts Payable

NOTE 13.    Notes and Contracts Payable:

 

 

December 31,

 

 

2021

 

 

2020

 

 

(dollars in millions)

 

2.40% senior unsecured notes due August 15, 2031, effective interest rate of 2.44%

$

650

 

 

$

—

 

4.00% senior unsecured notes due May 15, 2030, effective interest rate of 4.05%

 

450

 

 

 

450

 

4.60% senior unsecured notes due November 15, 2024, effective interest rate of 4.60%

 

300

 

 

 

300

 

4.30% senior unsecured notes due February 1, 2023, effective interest rate of 4.35%

 

250

 

 

 

250

 

Trust deed note due November 1, 2023, collateralized by land and buildings with net book values of $37 and $38 at December 31, 2021 and 2020, respectively, fixed interest rate of 5.26%

 

8

 

 

 

12

 

Other notes and contracts payable with maturities through 2024, weighted-average interest rates of 4.21% and 4.28% at December 31, 2021 and 2020, respectively

 

4

 

 

 

6

 

 

 

1,662

 

 

 

1,018

 

Unamortized discounts and debt issuance costs

 

(14

)

 

 

(7

)

 

$

1,648

 

 

$

1,011

 

In August 2021, the Company issued $650 million of 2.40% senior unsecured notes due in 2031. Interest is due semi-annually on February 15 and August 15, beginning February 15, 2022.

In April 2019, the Company entered into a senior unsecured credit agreement with JPMorgan Chase Bank, N.A. in its capacity as administrative agent and the lenders party thereto.  The credit agreement, which is comprised of a $700 million revolving credit facility, includes an expansion option that permits the Company, subject to satisfaction of certain conditions, to increase the revolving commitments and/or add term loan tranches in an aggregate amount not to exceed $350 million.  Unless terminated earlier, the credit agreement will terminate on April 30, 2024.  The obligations of the Company under the credit agreement are neither secured nor guaranteed.  Proceeds under the credit agreement may be used for general corporate purposes.  At December 31, 2021, the Company had no outstanding borrowings under the facility.

At the Company’s election, borrowings of revolving loans under the credit agreement bear interest at (a) the Alternate Base Rate plus the applicable spread or (b) until LIBOR is discontinued, the Adjusted LIBOR rate plus the applicable spread (in each case as defined in the credit agreement).  The Company may select interest periods of one, two, three or six months or (if agreed to by all lenders) such other number of months for Eurodollar borrowings of loans.  The applicable spread varies depending upon the debt rating assigned by Moody’s Investor Service, Inc., Standard & Poor’s Rating Services and/or Fitch Ratings Inc.  The minimum applicable spread for Alternate Base Rate borrowings is 0.25% and the maximum is 1.00%.  The minimum applicable spread for Adjusted LIBOR rate borrowings is 1.25% and the maximum is 2.00%.  The rate of interest on any term loans incurred in connection with the expansion option will be established at or about the time such loans are made and may differ from the rate of interest on revolving loans.

The credit agreement includes representations and warranties, reporting covenants, affirmative covenants, negative covenants, financial covenants and events of default customary for financings of this type. Upon the occurrence of an event of default the lenders may accelerate the loans. Upon the occurrence of certain insolvency and bankruptcy events of default the loans will automatically accelerate. As of December 31, 2021, the Company was in compliance with the financial covenants under the credit agreement.

The aggregate annual maturities for notes and contracts payable for the next five years and thereafter, are summarized as follows:

Year

Annual maturities

 

 

(in millions)

 

2022

$

7

 

2023

 

255

 

2024

 

300

 

2025

 

—

 

2026

 

—

 

Thereafter

 

1,100

 

 

$

1,662