GNRC · 10-Q · 2026Q2 · Full report
Interest Rate and Refinancing Exposure
GENERAC HOLDINGS INC. · 2026-08-04 · Importance 63 · Surprise 42 · No source text
Generac’s interest expense is affected by SOFR, interest-rate election periods, interest-rate swaps, debt repayments or borrowings, and credit-agreement amendments. On July 1, 2025, the company amended its Term Loan A and revolving facilities, extending both maturities to July 1, 2030, setting Term Loan A principal at $700 million, reducing revolving capacity to $1 billion, and reducing the applicable interest rate by 0.10%. As of June 30, 2026, Term Loan A and the revolving facility carried a 4.87% interest rate, while the company had $491.3 million outstanding under Term Loan B and $700 million under Term Loan A. The revolving facility had no borrowings and approximately $999.3 million of unused capacity, net of letters of credit.
Key facts
- On July 1, 2025, Generac amended Term Loan A Facility and Revolving Credit Facility, extending maturity of both to July 1, 2030, revising Term Loan A outstanding principal to $700,000 thousand and reducing Revolving borrowing capacity to $1,000,000 thousand, and interest rate reduction of 0.10%. source
- The New Tranche A Term Loan Facility is repayable in increasing quarterly installments equal to 0.625% to 2.50% of the original principal amount beginning on October 1, 2026. source
- The New Tranche A Term Loan Facility and the New Revolving Facility require maintaining a total leverage ratio below 3.75 to 1.00 and an interest coverage ratio above 3.00 to 1.00. source
- The New Tranche A Term Loan Facility and the New Revolving Facility bear interest at a rate based on SOFR plus an applicable margin between 1.25% and 1.75%, subject to a SOFR floor of 0.0%. source
- As of June 30, 2026, the interest rate for the New Tranche A Term Loan Facility and the New Revolving Facility was 4.87%. source
- The interest rate for the Term Loan B Facility was 5.37%. source
- As of June 30, 2026, our interest coverage ratio was 15.72 to 1.00. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| cash | negative | committed | -0.2% | The New Tranche A Term Loan Facility is repayable in increasing quarterly installments equal to 0.625% to 2.50% of the original principal… |
| liability | negative | committed | -0.2% | The New Tranche A Term Loan Facility is repayable in increasing quarterly installments equal to 0.625% to 2.50% of the original principal… |
| liability | unclear | realized | — | On July 1, 2025, Generac amended Term Loan A Facility and Revolving Credit Facility, extending maturity of both to July 1, 2030, revising… |
| net_income | positive | realized | — | On July 1, 2025, Generac amended Term Loan A Facility and Revolving Credit Facility, extending maturity of both to July 1, 2030, revising… |