Quarterly report pursuant to Section 13 or 15(d)

Long-Term Debt (Tables)

v3.8.0.1
Long-Term Debt (Tables)
 3 Months Ended
Mar. 31, 2018
Debt Disclosure [Abstract]  
Long-Term Debt
Long-term debt consists of the following:
 
March 31, 2018
 
December 31, 2017
 
(In thousands)
2016 Revolving Credit Facility (1)
$
100,000

 
$
75,000

5.0% Senior Subordinated Notes due 2023 (the “5.0% Notes”)
289,273

 
289,273

6.125% Senior Subordinated Notes due 2027 (the “6.125% Notes”)
250,000

 
250,000

Mortgage notes to finance companies-fixed rate, bearing interest from 3.51% to 7.03%
232,822

 
199,972

Mortgage notes to finance companies-variable rate, bearing interest at 1.50 to 2.90
   percentage points above one-month or three-month LIBOR
195,428

 
219,719

Debt issuance costs
(12,769
)
 
(13,208
)
Other
3,860

 
3,947

Total debt
$
1,058,614

 
$
1,024,703

Less current maturities
(53,957
)
 
(61,314
)
Long-term debt
$
1,004,657

 
$
963,389

(1)
The interest rate on the 2016 Revolving Credit Facility (as defined below) was 225 basis points above LIBOR at both March 31, 2018 and December 31, 2017.
Financial Covenants Include Required Specified Ratios
Sonic was in compliance with the covenants under the 2016 Credit Facilities as of March 31, 2018. Financial covenants include required specified ratios (as each is defined in the 2016 Credit Facilities) of:
 
Covenant
 
Minimum
Consolidated
Liquidity
Ratio
 
Minimum
Consolidated
Fixed Charge
Coverage
Ratio
 
Maximum
Consolidated
Total Lease
Adjusted Leverage
Ratio
Required ratio
1.05

 
1.20

 
5.75

March 31, 2018 actual
1.09

 
1.70

 
4.90

Summary of Interest Received and Paid under Term of Cash Flow Swap
Under the terms of the interest rate cap agreements, Sonic will receive and pay interest based on the following:
Notional
Amount
 
Pay Rate (1)
 
Receive Rate (2)
 
Start Date
 
End Date
(In millions)
 
 
 
 
 
 
 
 
$
250.0

 
2.000%
 
one-month LIBOR
 
September 1, 2017
 
June 30, 2018
$
375.0

 
2.000%
 
one-month LIBOR
 
July 1, 2018
 
June 30, 2019
$
375.0

 
3.000%
 
one-month LIBOR
 
July 1, 2018
 
June 30, 2019
$
312.5

 
2.000%
 
one-month LIBOR
 
July 1, 2019
 
June 30, 2020
$
250.0

 
3.000%
 
one-month LIBOR
 
July 1, 2019
 
June 30, 2020
$
225.0

 
3.000%
 
one-month LIBOR
 
July 1, 2020
 
June 30, 2021
$
150.0

 
2.000%
 
one-month LIBOR
 
July 1, 2020
 
July 1, 2021
$
250.0

 
3.000%
 
one-month LIBOR
 
July 1, 2021
 
July 1, 2022
(1)
Under these interest rate cap agreements, no payment to or from the counterparty will occur unless the stated receive rate exceeds the stated pay rate, in which case a net payment to Sonic from the counterparty based on the spread between the receive rate and the pay rate will be recognized as a reduction of interest expense, other, net in the accompanying condensed consolidated statements of income.
(2)
The one-month LIBOR rate was approximately 1.883% at March 31, 2018.