Annual report pursuant to Section 13 and 15(d)

Debt

v3.8.0.1
Debt
12 Months Ended
Dec. 31, 2017
Debt Disclosure [Abstract]  
Debt
Debt
Our debt as of December 31, 2017 and 2016 consisted of the following:
 
 
 
 
 
 
 
 
 
 
 
 
Carrying value(a) at
Issuer / Borrower
 
Issued
 
Debt
 
Maturity Date
 
Interest Payable
 
Principal Amount at December 31, 2017
 
December 31, 2017
 
December 31, 2016
Sirius XM
(b)(e)
 
May 2013
 
4.25% Senior Notes
(the "4.25% Notes")
 
May 15, 2020
 
semi-annually on May 15 and November 15
 
$

 
$

 
$
497,069

Sirius XM
(b)(f)
 
August 2013
 
5.75% Senior Notes
(the "5.75% Notes")
 
August 1, 2021
 
semi-annually on February 1 and August 1
 

 

 
596,386

Sirius XM
(b)(g)
 
July 2017
 
3.875% Senior Notes
(the "3.875% Notes")
 
August 1, 2022
 
semi-annually on February 1 and August 1
 
1,000,000

 
992,011

 

Sirius XM
(b)
 
May 2013
 
4.625% Senior Notes
(the "4.625% Notes")
 
May 15, 2023
 
semi-annually on May 15 and November 15
 
500,000

 
496,646

 
496,111

Sirius XM
(b)
 
May 2014
 
6.00% Senior Notes
(the "6.00% Notes")
 
July 15, 2024
 
semi-annually on January 15 and July 15
 
1,500,000

 
1,488,002

 
1,486,556

Sirius XM
(b)
 
March 2015
 
5.375% Senior Notes
(the "5.375% Notes due 2025")
 
April 15, 2025
 
semi-annually on April 15 and October 15
 
1,000,000

 
991,285

 
990,340

Sirius XM
(b)
 
May 2016
 
5.375% Senior Notes
(the "5.375% Notes due 2026")
 
July 15, 2026
 
semi-annually on January 15 and July 15
 
1,000,000

 
990,138

 
989,259

Sirius XM
(b)(g)
 
July 2017
 
5.00% Senior Notes
(the "5.00% Notes")
 
August 1, 2027
 
semi-annually on February 1 and August 1
 
1,500,000

 
1,486,162

 

Sirius XM
(b)(c)(h)
 
August 2012
 
5.25% Senior Secured Notes (the "5.25% Notes")
 
August 15, 2022
 
semi-annually on February 15 and August 15
 

 

 
396,232

Sirius XM
(d)
 
December 2012
 
Senior Secured Revolving Credit Facility (the "Credit Facility")
 
June 16, 2020
 
variable fee paid quarterly
 
1,750,000

 
300,000

 
390,000

Sirius XM
 
Various
 
Capital leases
 
Various
 
 n/a
 
 n/a

 
10,597

 
13,559

Total Debt
 
6,754,841

 
5,855,512

Less: total current maturities
 
5,105

 
5,485

Less: total deferred financing costs for Notes
 
8,493

 
7,263

Total long-term debt
 
$
6,741,243

 
$
5,842,764

(a)
The carrying value of the obligations is net of any remaining unamortized original issue discount.
(b)
Substantially all of our domestic wholly-owned subsidiaries have guaranteed these notes.
(c)
The liens that secured the 5.25% Notes were equal and ratable to the liens granted to secure the Credit Facility.  
(d)
Sirius XM's obligations under the Credit Facility are guaranteed by certain of its material domestic subsidiaries and are secured by a lien on substantially all of Sirius XM's assets and the assets of its material domestic subsidiaries.  Interest on borrowings is payable on a monthly basis and accrues at a rate based on LIBOR plus an applicable rate.  Sirius XM is also required to pay a variable fee on the average daily unused portion of the Credit Facility which is payable on a quarterly basis.  The variable rate for the unused portion of the Credit Facility was 0.25% per annum as of December 31, 2017.  Sirius XM's outstanding borrowings under the Credit Facility are classified as Long-term debt within our consolidated balance sheets due to the long-term maturity of this debt.
(e)
On July 27, 2017, Sirius XM redeemed $500,000 in outstanding principal amount of the 4.25% Notes for an aggregate purchase price, including premium and interest, of $509,565. We recognized $8,393 to Loss on extinguishment of debt, consisting primarily of unamortized discount, deferred financing fees and repayment premium, as a result of this redemption.
(f)
On August 4, 2017, Sirius XM redeemed $600,000 in outstanding principal amount of the 5.75% Notes for an aggregate purchase price, including premium and interest, of $617,538. We recognized $20,964 to Loss on extinguishment of debt, consisting primarily of unamortized discount, deferred financing fees and repayment premium, as a result of this redemption.
(g)
In July 2017, Sirius XM issued $1,000,000 aggregate principal amount of the 3.875% Notes and $1,500,000 aggregate principal amount of the 5.00% Notes with a net original issuance discount and deferred financing costs in the aggregate of $10,291 and $16,638, respectively.
(h)
On September 1, 2017, Sirius XM redeemed $400,000 in outstanding principal amount of the 5.25% Notes for an aggregate purchase price, including premium and interest, of $411,433. We recognized $14,322 to Loss on extinguishment of debt, consisting primarily of unamortized discount, deferred financing fees and repayment premium, as a result of this redemption. All security interests and other liens securing the 5.25% Notes were released.
Covenants and Restrictions
Under the Credit Facility, Sirius XM, our wholly-owned subsidiary, must comply with a debt maintenance covenant that it cannot exceed a total leverage ratio, calculated as consolidated total debt to consolidated operating cash flow, of 5.0 to 1.0.  The Credit Facility generally requires compliance with certain covenants that restrict Sirius XM's ability to, among other things, (i) incur additional indebtedness, (ii) incur liens, (iii) pay dividends or make certain other restricted payments, investments or acquisitions, (iv) enter into certain transactions with affiliates, (v) merge or consolidate with another person, (vi) sell, assign, lease or otherwise dispose of all or substantially all of Sirius XM's assets, and (vii) make voluntary prepayments of certain debt, in each case subject to exceptions.
The indentures governing Sirius XM's notes restrict Sirius XM's non-guarantor subsidiaries' ability to create, assume, incur or guarantee additional indebtedness without such non-guarantor subsidiary guaranteeing each such series of notes on a pari passu basis.  The indentures governing the notes also contain covenants that, among other things, limit Sirius XM's ability and the ability of its subsidiaries to create certain liens; enter into sale/leaseback transactions; and merge or consolidate.
Under Sirius XM's debt agreements, the following generally constitute an event of default: (i) a default in the payment of interest; (ii) a default in the payment of principal; (iii) failure to comply with covenants; (iv) failure to pay other indebtedness after final maturity or acceleration of other indebtedness exceeding a specified amount; (v) certain events of bankruptcy; (vi) a judgment for payment of money exceeding a specified aggregate amount; and (vii) voidance of subsidiary guarantees, subject to grace periods where applicable.  If an event of default occurs and is continuing, our debt could become immediately due and payable.
At December 31, 2017 and 2016, we were in compliance with our debt covenants.