What is the rate for the Term Facility under the 2022 Credit Agreement? What is the rate for the 2022 Revolving Credit Facility? What drove the decision to increase borrowing under the term loan in the second quarter? Have you swapped out any of your floating-rate debt obligations?

November 18, 2022

Under the 2022 Credit Agreement, originally closed in May 2022 and amended in September 2022, the Term Facility and the Revolving Credit Facility have the same interest-rate structure. That rate is based on the Secured Overnight Financing Rate (SOFR) plus a spread tied to our consolidated leverage ratio. As of September 30, 2022, the all-in rate was 4.26% based on SOFR plus a 1.225% spread. 

The 2022 Credit Agreement entered into in May 2022 included a $600 million term loan and the option of a $50 million delayed draw to finance the LCD acquisition. With the amendment to the agreement, we accelerated the $50 million draw. The structure of our credit facility, particularly the term loan component used for the LCD acquisition, is a good fit for our needs. The prepayable nature of the loan will allow us to use excess cash to pay it down over time. We were able to use a similar funding strategy with the acquisition of DBRS.

As of 9/30/22, 30% of our total debt (excluding capital leases) was fixed rate; the remaining 70% was floating rate. Our average weighted cost of borrowing was 3.67%. We do not currently swap out any of our debt. 

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