Company: IRDM
Filing Date: 2025-07-24
Form Type: 10-Q
Source: 0001628280-25-035835
Chunk: 13

Company: Iridium Communications Inc.
Filing Date: 2025-07-24
Form: 10-Q
Item: Part I, Item 8
Chunk 13
---
 and repricing transactions.The Credit Agreement contains no financial maintenance covenants with respect to the Term Loan. With respect to the Revolving Facility, the Credit Agreement requires the Company to maintain a consolidated first lien net leverage ratio (as defined in the Credit Agreement) of no greater than 6.25 to 1 if more than 35% of the Revolving Facility has been drawn, or subject to letter of credit exposure. As of June 30, 2025, the aggregate exposure under the Revolving Facility was above 35% and the Company was in compliance with all covenants. The Credit Agreement contains other customary representations and warranties, affirmative and negative covenants, and events of default. Interest on DebtTotal interest incurred includes amortization of deferred financing fees and capitalized interest. The Company incurred third-party financing costs of $1.6 million in connection with the expansion of the Term Loan in March 2024 and $1.9 million related to the repricing of the Term Loan in June 2024, materially all of which was expensed at that time. The amounts expensed are included within interest expense on the condensed consolidated statements of operations and comprehensive income. There were no such expenses in 2025. The following table presents the interest and amortization of deferred financing fees related to the Term Loan:Three Months Ended June 30,Six Months Ended June 30,2025202420252024(In thousands)(In thousands)Total interest incurred$24,742 $26,121 $48,999 $49,306 Amortization of deferred financing fees$725 $638 $1,436 $1,261 Capitalized interest$833 $1,190 $2,067 $2,248 At each of June 30, 2025 and December 31, 2024, accrued interest on the Term Loan was $0.3 million.

6. Derivative Financial Instruments

The Company is exposed to interest rate fluctuations related to the Term Loan. The Company has reduced its exposure to fluctuations in the cash flows associated with changes in the variable interest rate by entering into offsetting positions through the use of interest rate hedges. This will reduce the negative impact of increases in the variable rate over the term of the derivative contracts. These contracts are not used for trading or other speculative purposes. Historically, the Company has not incurred, and does not expect to incur in the future, any losses as a result of counterparty default