Company: EGP
Filing Date: 2025-02-12
Form Type: 10-K
Source: 0000049600-25-000019
Chunk: 149

Company: EASTGROUP PROPERTIES INC
Filing Date: 2025-02-12
Form: 10-K
Item: Item 3
Chunk 149
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 with a maturity date of July 31, 2028, or such later date as designated by the bank; the Company also has two six-month extensions available if the extension options in the $625,000,000 facility are exercised. The interest rate is reset on a daily basis and as of December 31, 2024, was SOFR plus 77.5 basis points with an annual facility fee of 15 basis points.  As of December 31, 2024, the interest rate was 5.335% with no outstanding balance.

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For both facilities, the margin and facility fee are subject to changes in the Company’s credit ratings.  Although the Company’s current credit rating is Baa2, given the strength of the Company’s key credit metrics, initial pricing for the credit facilities is based on the BBB+/Baa1 credit ratings level.  This favorable pricing level will be retained provided that the Company’s consolidated leverage ratio, as defined in the applicable agreements, remains less than 32.5%.  

The $625,000,000 facility is also subject to a sustainability-linked pricing component, pursuant to which the applicable interest rate margin is adjusted if the Company meets a certain sustainability performance target.  This sustainability metric is evaluated annually and was achieved for the years ended December 31, 2024, 2023 and 2022, which allowed for the interest rate reduction in each of the years subsequent to achieving the metric.  The margin was effectively reduced on this unsecured bank credit facility for the years ended December 31, 2024 and 2023, by one basis point, from 77.5 to 76.5 basis points.

The Company’s unsecured bank credit facilities have certain restrictive covenants, such as maintaining minimum debt service coverage and leverage ratios and maintaining insurance coverage, and the Company was in compliance with all of its financial debt covenants at December 31, 2024.

On October 25, 2024, we established an ATM common stock offering program pursuant to which we are able to sell from time to time shares of our common stock having an aggregate gross sales price of up to $1,000,000,000 (the “Current ATM Program”). The Current ATM Program replaced our previous $750,000,000 ATM program (the “Prior ATM Program”), which was established on October 25, 2023, under which we had sold shares of our common stock having an aggregate gross sales price of $746,153