Annual report pursuant to Section 13 and 15(d)

Debt

v2.4.1.9
Debt
 12 Months Ended
Dec. 31, 2014
Debt Disclosure [Abstract]  
Debt
Debt

Our debt as of December 31, 2014 and 2013 consisted of the following:
 
 
 
 
 
 
 
 
 
 
 
 
 Carrying value at
Issuer / Borrower
 
Issued
 
Debt
 
Maturity Date
 
Interest Payable
 
Principal Amount
 
December 31, 2014
 
December 31, 2013
Sirius XM
(a)
 
August 2008
 
7% Exchangeable 
Senior Subordinated Notes (the "Exchangeable Notes")
 
December 1, 2014
 
semi-annually on June 1 and December 1
 
$
—

 
$
—

 
$
500,481

Sirius XM
(a)(b)
 
May 2013
 
4.25% Senior Notes
(the "4.25% Notes")
 
May 15, 2020
 
semi-annually on May 15 and November 15
 
500,000

 
495,529

 
494,809

Sirius XM
(a)(b)
 
September 2013
 
5.875% Senior Notes
(the "5.875% Notes")
 
October 1, 2020
 
semi-annually on April 1 and October 1
 
650,000

 
643,790

 
642,914

Sirius XM
(a)(b)
 
August 2013
 
5.75% Senior Notes
(the "5.75% Notes")
 
August 1, 2021
 
semi-annually on February 1 and August 1
 
600,000

 
595,091

 
594,499

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

 
495,116

 
494,653

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

 
1,483,918

 
—

Sirius XM
(a)(b)(d)
 
August 2012
 
5.25% Senior Secured Notes (the "5.25% Notes")
 
August 15, 2022
 
semi-annually on February 15 and August 15
 
400,000

 
395,147

 
394,648

Sirius XM
(e)
 
December 2012
 
Senior Secured Revolving Credit Facility (the "Credit Facility")
 
December 5, 2017
 
variable fee paid quarterly
 
1,250,000

 
380,000

 
460,000

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

 
12,754

 
19,591

Total Debt
 
4,501,345

 
3,601,595

Less: total current maturities non-related party
 
7,482

 
496,815

Less: total current maturities related party
 
—

 
10,959

Total long-term debt
 
$
4,493,863

 
$
3,093,821

(a)
The carrying value of the notes are net of the remaining unamortized original issue discount.
(b)
Substantially all of our domestic wholly-owned subsidiaries have guaranteed these notes.
(c)
In May 2014, Sirius XM issued $1,500,000 aggregate principal amount of 6.00% Senior Notes due 2024, with an original issuance discount of $16,875.
(d)
In April 2014, we entered into a supplemental indenture to the indenture governing the 5.25% Notes pursuant to which we granted a first priority lien on substantially all of the assets of Sirius XM and the guarantors to the holders of the 5.25% Notes. The liens securing the 5.25% Notes are equal and ratable to the liens granted to secure the Credit Facility.
(e)
In December 2012, Sirius XM entered into a five-year Credit Facility with a syndicate of financial institutions for $1,250,000. 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. Borrowings under the Credit Facility are used for working capital and other general corporate purposes, including dividends, financing of acquisitions and share repurchases. 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 and is payable on a quarterly basis. The variable rate for the unused portion of the Credit Facility was 0.35% per annum as of December 31, 2014. As of December 31, 2014, $870,000 was available for future borrowing under the Credit Facility. 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.

Retired and Converted Debt

The Exchangeable Notes were exchangeable at anytime at the option of the holder into shares of our common stock at an exchange rate of 543.1372 shares of common stock per 1,000 dollars of principal amount of the notes, which is equivalent to an approximate exchange price of $1.841 per share of common stock. All holders of the Exchangeable Notes converted prior to the Exchangeable Notes' maturity on December 1, 2014. During the year ended December 31, 2014, $502,370 in principal amount of the Exchangeable Notes were converted, resulting in the issuance of 272,855,859 shares of our common stock. No loss was recognized as a result of this conversion.

During the year ended December 31, 2013, we purchased $800,000 of our then outstanding 8.75% Senior Notes due 2015, for an aggregate purchase price, including premium and interest, of $927,860. We recognized $104,818 to Loss on extinguishment of debt and credit facilities, net, consisting primarily of unamortized discount, deferred financing fees and repayment premium, as a result of this transaction.

During the year ended December 31, 2013, we also purchased $700,000 of our then outstanding 7.625% Senior Notes due 2018, for an aggregate purchase price, including premium and interest, of $797,830. We recognized $85,759 to Loss on extinguishment of debt and credit facilities, net, consisting primarily of unamortized discount, deferred financing fees and repayment premium, as a result of this transaction.

Covenants and Restrictions

Under the Credit Facility, Sirius XM, our wholly-owned subsidiary, must comply with a debt maintenance covenant that it not exceed a total leverage ratio, calculated as total consolidated 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, 2014 and 2013, we were in compliance with our debt covenants.