You are calculating the cost of capital for Drill Corp. The firm's capital structure consisted of operating leases, two bonds, and equity. The operating lease has a debt value of $500 million. The first bond is a simple 30-year semiannual coupon paying bond with a book value of $200 million and market value of $125 million. The second is a zero-coupon bond with 10 years to maturity and $500 million face value. The firm's equity has a book value of $600 million, but a market value of $1 billion.

The firm has a debt rating of BB, beta of 1.8, and tax rate of 35%. The expected market risk premium is 6.5%, considering a risk-free rate of 5%. From professional journals, you also know yields associated with specific debt ratings, which are as the following

Yield (%) AAA AA A BBB BB B

9.30 9.79 10.08 10.89 12.75 14.66

Estimate the weighted average cost of capital for Drill Co.