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DEBT
 12 Months Ended
Dec. 31, 2024
Debt Disclosure [Abstract]  
DEBT
Debt outstanding was comprised of the following:

(in thousands)20242023
Senior secured term loan facility$500,000 $877,187 
Senior unsecured notes475,000 475,000 
Senior secured notes450,000 — 
Securitization obligations78,917 — 
Amounts drawn on senior secured revolving credit facility18,000 252,000 
Total principal amount1,521,917 1,604,187 
Less: unamortized discount and debt issuance costs(18,766)(11,336)
Total debt, net of discount and debt issuance costs1,503,151 1,592,851 
Less: current portion of long-term debt, net of debt issuance costs(37,130)(86,153)
Long-term debt$1,466,021 $1,506,698 

Maturities of long-term debt were as follows as of December 31, 2024:
(in thousands)Debt obligations
2025$37,500 
202637,500 
2027116,417 
202850,000 
20291,280,500 
Total principal amount$1,521,917 

Credit facility – In December 2024, we executed a $900,000 amended and restated credit agreement, which includes commitments of $400,000 under a revolving credit facility and $500,000 under a term loan facility. The revolving credit facility includes a $40,000 swingline sub-facility and a $25,000 letter of credit sub-facility. Concurrently, we repaid and terminated our previous credit facility, recording interest expense of $1,670 for the write-off of the related unamortized debt issuance costs. Net proceeds from the new credit facility were $604,431. Loans under the new revolving credit facility can be borrowed, repaid, and re-borrowed until February 1, 2029, at which point all outstanding amounts must be repaid. The term loan facility is structured to be repaid in equal quarterly installments of $9,375 from March 2025 to December 2027, and $12,500 from March 2028 to December 2028, with the remaining balance due on February 1, 2029. The term loan facility includes mandatory prepayment requirements related to asset sales, certain casualty or other insured damage to assets, and new debt (excluding permitted debt), subject to certain limitations. No premium or penalty is incurred for any mandatory or voluntary prepayment of the term loan facility.

Interest on the credit facility is payable at a fluctuating rate, as outlined in the credit agreement. A commitment fee is also payable on the unused portion of the revolving credit facility. Amounts outstanding under the current and previous credit facilities had a weighted-average interest rate of 7.23% as of December 31, 2024 and 6.83% as of December 31, 2023, which includes the impact of interest rate swaps that converted a portion of our variable-rate debt to fixed-rate debt. Additional details about the interest rate swaps can be found in Note 7.

Borrowings under the credit facility are secured by substantially all of the present and future tangible and intangible personal property held by us and our subsidiaries that have guaranteed our obligations under the credit facility, subject to certain exceptions. The credit agreement includes customary covenants that limit levels of indebtedness, liens, mergers, certain asset dispositions, changes in business, advances, investments, loans, and restricted payments. These covenants are subject to various limitations and exceptions outlined in the credit agreement. Additionally, the credit agreement imposes requirements on our consolidated total leverage ratio and our consolidated secured leverage ratio. The consolidated total leverage ratio is calculated as (i) consolidated indebtedness minus unrestricted cash and cash equivalents in excess of $15,000 to (ii) consolidated EBITDA for the period, as defined in the agreement. The consolidated secured leverage ratio is defined as (i) consolidated secured indebtedness minus unrestricted cash and cash equivalents in excess of $15,000 to (ii) consolidated
EBITDA for the period, as defined in the agreement. These ratios may not equal or exceed the following amounts during the periods indicated:

Fiscal Quarter EndingConsolidated total leverage ratioConsolidated secured leverage ratio
December 31, 2024 through March 31, 2026
4.25 to 1:00
3.50 to 1:00
June 30, 2026 and each fiscal quarter thereafter
4.00 to 1:00
3.25 to 1:00

Furthermore, we are required to maintain a minimum interest coverage ratio of at least 3.00 to 1.00 for the duration of the credit facility. This ratio is calculated as (i) consolidated EBITDA, as defined in the agreement, for the trailing four quarters to (ii) consolidated interest expense for the same period. In addition, if our consolidated total leverage ratio exceeds 2.75 to 1.00, the aggregate amount of permitted dividends, incentive-based share repurchases, and repurchases under an open market repurchase program is limited to an annual amount of $60,000, provided that the amount of any share repurchases made under an open market repurchase program does not exceed $30,000 in a fiscal year.

Failure to comply with any of these requirements would constitute an event of default, which would enable the lenders to declare all amounts outstanding immediately due and payable. In such a scenario, the lenders would also have the right to enforce their interests against the collateral pledged if we were unable to settle the outstanding amounts. As of December 31, 2024, we were in compliance with all debt covenants.

The credit agreement includes customary representations and warranties. As a condition for borrowing, it requires that all such representations and warranties be true and correct in all material respects on the date of each borrowing. This includes representations affirming that there has been no material adverse change in our business, assets, operations, or financial condition.

As of December 31, 2024, amounts were available for borrowing under our revolving credit facility as follows:
(in thousands)Total available
Revolving credit facility commitment$400,000 
Amount drawn on revolving credit facility(18,000)
Outstanding letters of credit(1)
(7,698)
Net available for borrowing as of December 31, 2024
$374,302 

(1) We utilize standby letters of credit primarily to secure certain obligations associated with our self-insured workers' compensation claims and environmental claims, as mandated by certain states. These letters of credit reduce the available borrowing capacity under our revolving credit facility.

Senior unsecured and secured notes – In June 2021, we issued $500,000 of 8.0% senior unsecured notes that mature in June 2029. These notes were issued via a private placement under Rule 144A of the Securities Act of 1933. Proceeds from the offering, net of discount and offering costs, were $490,741, resulting in an effective interest rate of 8.3%. The net proceeds were utilized to finance the acquisition of First American Payment Systems, L.P. Interest payments are due each June and December. During the quarter ended September 30, 2022, we repurchased $25,000 of these notes on the open market, realizing a pretax gain of $1,726, which is included in interest expense on the consolidated statement of income.

In December 2024, we issued $450,000 of 8.125% senior secured notes that mature in September 2029. However, if any of the senior unsecured notes remain outstanding as of February 1, 2029, the senior secured notes will mature on February 1, 2029. These notes were also issued via a private placement under Rule 144A of the Securities Act of 1933. The proceeds from this offering, net of discount and offering costs, were $441,481, resulting in an effective interest rate of 8.6%. The net proceeds, along with borrowings from the new credit facility established in December 2024, were used to refinance the previous senior secured term loan facility and revolving credit facility. Interest payments for these notes are due each March and September.

The indentures governing the notes include covenants that restrict our ability, and that of our restricted subsidiaries, to undertake certain actions. These restrictions include limitations on incurring additional debt and liens, issuing redeemable and preferred stock, paying dividends and distributions, making loans and investments, and consolidating, merging, or selling all or substantially all of our assets.

Securitization facility – In March 2024, Deluxe Receivables LLC, a wholly-owned subsidiary, established a receivables financing agreement (the “Securitization Facility”). This agreement terminates in March 2027, unless extended per its terms. The maximum borrowing capacity under the Securitization Facility is $80,000, subject to certain borrowing base adjustments. Under this agreement, we have sold and will continue to automatically sell certain accounts receivable to the subsidiary, which serve as collateral for borrowings under the facility and which totaled approximately $117,000 as of December 31, 2024. Borrowings
accrue interest at a commercial paper rate for borrowings funded by a conduit lender through the issuance of notes, and for other borrowings, at the Secured Overnight Financing Rate plus an applicable margin. Also, a commitment fee is charged on the unused portion of the facility. Interest and fees are payable monthly. As of December 31, 2024, $78,917 was outstanding under the facility at an interest rate of 6.22%. The proceeds from these borrowings were used to prepay amounts due under our former secured term loan facility.

The Securitization Facility is treated as a collateralized financing activity rather than a sale of assets. Consequently, the subsidiary is consolidated, and the receivable balances pledged as collateral are reported as accounts receivable on the consolidated balance sheet, while the borrowings are classified as long-term debt. Cash receipts from the underlying receivables are reflected as operating cash flows on the consolidated statement of cash flows, and borrowings and repayments under the collateralized loans are reflected as financing cash flows.