Vulcan Materials CO

NOTE 6: DEBT

Debt at December 31 is detailed as follows:

1 Borrowings on the bank line of credit and commercial paper are classified as short-term if we intend to repay within twelve months and as long-term if we have the intent and ability to extend payment beyond twelve months.

2 See Note 5 for additional information on our fair value hedging strategy.

Discounts and debt issuance costs are amortized using the effective interest method over the terms of the respective notes resulting in $11.4 million and $6.2 million of net interest expense for these items for 2024 and 2023, respectively.

LINE OF CREDIT AND COMMERCIAL PAPER PROGRAM

Our $1,600.0 million commercial paper program was established in August 2022 and matures in November 2029. Commercial paper borrowings bear interest at rates determined at the time of borrowing and as agreed between us and the commercial paper investors. As of December 31, 2024, we had $550.0 million in long-term commercial paper borrowings.

Our $1,600.0 million unsecured line of credit was amended in November 2024 to extend the maturity date from August 2027 to November 2029. Our line of credit contains covenants customary for an unsecured investment-grade facility. As of December 31, 2024, we were in compliance with the line of credit covenants. Borrowings on the line of credit bear interest, at our option, at either SOFR plus a margin or Truist Bank’s base rate plus a margin. The margins are determined by our credit ratings. Standby letters of credit, which are issued under the line of credit and reduce availability, are charged a fee equal to the margin for SOFR borrowings plus 0.175%. We also pay a commitment fee on the daily average unused amount of the line of credit that ranges from 0.090% to 0.225% determined by our credit ratings. As of December 31, 2024, the margin for SOFR borrowings was 1.125%, the margin for base rate borrowings was 0.125% and the commitment fee for the unused amount was 0.100%.

As of December 31, 2024, our available borrowing capacity under the line of credit was $1,504.8 million. Utilization of the borrowing capacity was as follows:

▪None was borrowed

▪$95.2 million was used to support standby letters of credit

TERM DEBT

All of our $5,391.1 million (face value) of term debt (which includes $550.0 million of commercial paper) is unsecured. All of the covenants in the debt agreements are customary for investment-grade facilities. As of December 31, 2024, we were in compliance with all term debt covenants.

In March 2023, we issued $550.0 million of 5.80% senior notes due 2026. We redeemed these notes at par in March 2024 using cash on hand and recognized noncash expense of $2.3 million with the acceleration of unamortized deferred debt issuance costs.

In November 2024, we entered into a $2,000.0 million unsecured delayed draw term loan which was partially drawn in November 2024 upon the acquisition of Wake Stone Corporation (Wake Stone). Subsequently, the delayed draw term loan balance was fully repaid and terminated in November 2024 using proceeds from the issuance of senior notes as described below.

In November 2024, we issued $500.0 million of 4.95% senior notes due 2029, $750.0 million of 5.35% senior notes due 2034 and $750.0 million of 5.70% senior notes due 2054. Total proceeds of $1,975.0 million (net of discounts and transaction costs), together with cash on hand, were used to repay the outstanding balance on the $2,000.0 million delayed draw term loan and to provide liquidity for acquisitions and debt maturing in 2025.

The total scheduled (principal and interest) debt payments, excluding the line of credit, for the five years subsequent to December 31, 2024 are as follows:

STANDBY LETTERS OF CREDIT

We provide, in the normal course of business, certain third-party beneficiaries with standby letters of credit to support our obligations to pay or perform according to the requirements of an underlying agreement. Such letters of credit typically have an initial term ofone year, renew automatically and can only be modified or canceled with the approval of the beneficiary. Except for $9.6 million of letters of credit related to acquisitions completed in 2024, our standby letters of credit are issued by banks that participate in our $1,600.0 million line of credit and reduce the borrowing capacity thereunder. Our standby letters of credit as of December 31, 2024 are summarized by purpose in the table below: