6. Debt

Term Loans and Revolving Credit Facilities

Pursuant to a credit agreement (the “Credit Agreement”), we have a revolving credit facility (the “Revolver”), where we can borrow up to $250,000, subject to the terms of the agreement, and a term A loan with an aggregate initial principal amount of $250,000 (the “Term A Loan,” and together with the Revolver, the “Credit Facilities”). The Credit Facilities have applicable margins equal to 2.00%, 1.75% or 1.50%, in the case of LIBOR and Eurodollar rate loans and 1.00%, 0.75% or 0.50%, in the case of base rate loans; the applicable margins are based on the First Lien Net Leverage Ratio, as defined in the Credit Agreement. The LIBOR rate is subject to a floor of 0.00%. The Credit Facilities mature on June 29, 2022.

The Credit Facilities require, among other things, the maintenance of (i) a maximum First Lien Net Leverage Ratio and (ii) a minimum consolidated interest coverage ratio, each calculated on a trailing four quarter basis, and contain an acceleration clause should an event of default (as defined in the Credit Agreement) occur. As of December 31, 2019, we were in compliance with the financial covenants.

As of December 31, 2019, we had $149,000 in borrowings under the Revolver and had outstanding letters of credit of $2,709, leaving $98,291 available for borrowings and letters of credit under the Revolver. We obtain letters of credit in connection with certain regulatory and insurance obligations, inventory purchases and other contractual obligations. The terms of these letters of credit are all less than one year.

As of December 31, 2019, the interest rates for the Revolver and the Term A Loan were 3.51% and 3.61%, respectively. The weighted-average interest rates for the outstanding revolving credit facilities were 3.58% and 3.71% for the six months ended December 31, 2019 and 2018, respectively. The weighted-average interest rates for the term loans were 3.46% and 3.47% for the six months ended December 31, 2019 and 2018, respectively.

In July 2017, we entered into an interest rate swap agreement on $150,000 of notional principal that effectively converts the floating LIBOR portion of our interest obligation on that amount of debt, to a fixed interest rate of 1.8325% plus the applicable rate. The agreement matures concurrent with the Credit Agreement. We designated the interest rate swap as a highly effective cash flow hedge. For additional details, see “—Derivatives.”

Long-Term Debt


	December 31,		June 30,
As of	2019		2019
Term A Loan due June 2022	$	225,000	$	231,250
Other		—		40
		225,000		231,290
Unamortized debt issuance costs and debt discount		(929)		(1,115)
		224,071		230,175
Less: current maturities		(15,625)		(12,540)
	$	208,446	$	217,635