Secured Debt Outstanding Principal Balance Subject To LIBOR

  
DAVITA INC.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(continued)(unaudited)(dollars and shares in thousands, except per share data)  
6.     Long-term debtLong-term debt was comprised of the following:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | As of June 30, 2022 |
|  | June 30, 2022 |  | December 31, 2021 |  | Maturity date |  | Interest rate |  | Estimated fair value(1) |
| Senior Secured Credit Facilities: |   |  |   |  |  |  |  |  |  |
| Term Loan A | $ | 1,553,125  |  |  | $ | 1,596,875  |  |  | 8/12/2024 |  | LIBOR+1.75% |  | $ | 1,537,594  |  |
| Term Loan B-1 | 2,674,547  |  |  | 2,688,263  |  |  | 8/12/2026 |  | LIBOR+1.75% |  | $ | 2,497,358  |  |
| Revolving line of credit | 425,000  |  |  | —  |  |  | 8/12/2024 |  | LIBOR+1.75% |  | $ | 425,000  |  |
| Senior Notes: |  |  |  |  |  |  |  |  |  |
| 4.625% Senior Notes | 2,750,000  |  |  | 2,750,000  |  |  | 6/1/2030 |  | 4.625  | % |  | $ | 2,158,750  |  |
| 3.75% Senior Notes | 1,500,000  |  |  | 1,500,000  |  |  | 2/15/2031 |  | 3.75  | % |  | $ | 1,074,375  |  |
| Acquisition obligations and other notes payable(2) | 125,035  |  |  | 130,599  |  |  | 2022-2036 |  | 5.24  | % |  | $ | 125,035  |  |
| Financing lease obligations(3) | 285,279  |  |  | 299,128  |  |  | 2023-2038 |  | 4.54  | % |  |  |
| Total debt principal outstanding | 9,312,986  |  |  | 8,964,865  |  |  |  |  |  |  |  |
| Discount, premium and deferred financing costs(4) | (50,560) |  |  | (56,685) |  |  |  |  |  |  |  |
|   | 9,262,426  |  |  | 8,908,180  |  |  |  |  |  |  |  |
| Less current portion | (197,510) |  |  | (179,030) |  |  |  |  |  |  |  |
|   | $ | 9,064,916  |  |  | $ | 8,729,150  |  |  |  |  |  |  |  |



|  |  |  |
| --- | --- | --- |
|  |  |  |
|  |

(1)For the Company's senior secured credit facilities and senior notes, fair value estimates are based upon bid and ask quotes, typically a level 2 input. For acquisition obligations and other notes payable, the carrying values presented approximate their estimated fair values, based on estimates of their present values using level 2 interest rate inputs. (2)The interest rate presented for acquisition obligations and other notes payable is their weighted average interest rate based on the current fixed and variable interest rate components in effect as of June 30, 2022.(3)Financing lease obligations are measured at their approximate present values at inception. The interest rate presented is the weighted average discount rate embedded in financing leases outstanding.(4)As of June 30, 2022, the carrying amount of the Company's senior secured credit facilities have been reduced by a discount of $3,983 and deferred financing costs of $22,983, and the carrying amount of the Company's senior notes have been reduced by deferred financing costs of $38,558 and increased by a debt premium of $14,964. As of December 31, 2021, the carrying amount of the Company's senior secured credit facilities were reduced by a discount of $4,473 and deferred financing costs of $27,207, and the carrying amount of the Company's senior notes were reduced by deferred financing costs of $40,914 and increased by a debt premium of $15,909.During the first six months of 2022, the Company made regularly scheduled mandatory principal payments under its senior secured credit facilities totaling $43,750 on Term Loan A and $13,716 on Term Loan B-1.As of June 30, 2022, the Company's 2019 interest rate cap agreements have the economic effect of capping the Company's maximum exposure to LIBOR variable interest rate changes on equivalent amounts of the Company's floating rate debt, including all of Term Loan B-1 and a portion of Term Loan A. The remaining $727,672 outstanding principal balance of Term Loan A and the $425,000 balance outstanding on the revolving line of credit are subject to LIBOR-based interest rate volatility. These cap agreements are designated as cash flow hedges and, as a result, changes in their fair values are reported in other comprehensive income. The original premiums paid for the caps are amortized to debt expense on a straight-line basis over the term of each cap agreement starting from its effective date. These cap agreements do not contain credit risk-contingent features.  
  
  
11
