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Table of Contents
Company could redeem the 8.50% Notes prior to November 15, 2013 in whole or in part at a redemption price of 100% of the principal plus
accrued interest, plus a “make-whole” premium.
In the first quarter of 2013, the Company redeemed the outstanding $200.0 million aggregate principal amount of 8.50% Notes and
pursuant to the make-whole provision in the Indenture governing the 8.50% Notes, paid a $19.4 million premium and $5.1 million of
accrued and unpaid interest. The Company recognized a loss on extinguishment of debt of $25.1 million related to redemption of the 8.50%
Notes which included the write off of unamortized debt issuance costs of $4.2 million .
5.375% Senior Notes
In February 2013, the Company issued $500.0 million aggregate principal amount of 5.375% senior notes due 2021 (the “ 5.375%
Notes
”). The 5.375% Notes were issued at par and are senior unsecured obligations of the Company. Interest is payable semi-annually at a
rate of 5.375% per annum on February 1 and August 1 of each year, commencing on August 1, 2013. The 5.375% Notes are repayable in
whole or in part upon the occurrence of a change of control, at the option of the holders, at a purchase price in cash equal to 101% of the
principal plus accrued interest. The Company may redeem the 5.375% Notes prior to maturity in whole or in part at an amount equal to the
principal amount thereof plus accrued and unpaid interest plus a make-whole payment equivalent to the present value of the remaining interest
payments through maturity.
The 5.375% Notes include, among other terms and conditions, limitations on the Company's ability to create, incur or allow certain
liens; enter into sale and lease-back transactions; create, assume, incur or guarantee additional indebtedness of the Company's subsidiaries; and
consolidate or merge with, or convey, transfer or lease all or substantially all of the Company's and its subsidiaries assets, to another person. At
December 31, 2014 the Company was in compliance with these covenants.
In the first quarter of 2013, the Company used $224.5 million of the net proceeds of the 5.375% Notes to redeem the outstanding
$200.0 million aggregate principal amount of 8.50% Notes.
Based on quoted market prices in less active markets (a Level 2 input for this financial instrument), the fair value of the 5.375% Notes
was $520.0 million and $506.3 million as of December 31, 2014 and 2013 respectively.
5.750% Senior Notes
In February 2014, the Company issued $400.0 million aggregate principal amount of 5.750% Senior Notes due 2024 (the " 5.750%
Notes"). The
5.750% Notes were issued at par and are senior unsecured obligations of the Company. Interest is payable semi-annually at a rate
of 5.750% per annum on March 1 and September 1 of each year, commencing on September 1, 2014. The 5.750% Notes are repayable in
whole or in part upon the occurrence of a change of control, at the option of the holders, at a purchase price in cash equal to 101% of the
principal plus accrued interest. The Company may redeem the 5.750% Notes prior to maturity in whole or in part at an amount equal to the
principal amount thereof plus accrued and unpaid interest plus a make-whole payment equivalent to the present value of the remaining interest
payments through maturity.
The 5.750% Notes include, among other terms and conditions, limitations on the Company's ability to create, incur or allow certain liens;
enter into sale and lease-back transactions; create, assume, incur or guarantee additional indebtedness of the Company's subsidiaries; and
consolidate or merge with, or convey, transfer or lease all or substantially all of the Company's and its subsidiaries assets, to another person. At
December 31, 2014, the Company was in compliance with these covenants.
Based on quoted market prices in less active markets (a Level 2 input for this financial instrument), the fair value of the 5.750% Notes as
of December 31, 2014 was $416.0 million .
Streaming Content
At December 31, 2014, the Company had $9.5 billion of obligations comprised of $2.1 billion included in "Current content liabilities"
and $1.6 billion of "Non-current content liabilities" on the Consolidated Balance Sheets and $5.8 billion of obligations that are not reflected on
the Consolidated Balance Sheet.
53
6.
Commitments and Contingencies