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Long-term Debt and Finance Leases | 3 Months Ended
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Mar. 31, 2024
Debt Disclosure [Abstract] |
Long-term Debt and Finance Leases | Long-term Debt and Finance Leases Long-term debt and finance leases consisted of the following:
(In millions, except rates) | March 31, 2024 |  | December 31, 2023 |  | Interest rate %
Recourse debt: |  |  |  |  |
Senior Notes, due 2027 | $ | 375 |  |  | $ | 375 |  |  | 6.625
Senior Notes, due 2028 | 821 |  |  | 821 |  |  | 5.750
Senior Notes, due 2029 | 733 |  |  | 733 |  |  | 5.250
Senior Notes, due 2029 | 500 |  |  | 500 |  |  | 3.375
Senior Notes, due 2031 | 1,030 |  |  | 1,030 |  |  | 3.625
Senior Notes, due 2032 | 480 |  |  | 480 |  |  | 3.875
Convertible Senior Notes, due 2048(a) | 483 |  |  | 575 |  |  | 2.750
Senior Secured First Lien Notes, due 2024 | 600 |  |  | 600 |  |  | 3.750
Senior Secured First Lien Notes, due 2025 | 500 |  |  | 500 |  |  | 2.000
Senior Secured First Lien Notes, due 2027 | 900 |  |  | 900 |  |  | 2.450
Senior Secured First Lien Notes, due 2029 | 500 |  |  | 500 |  |  | 4.450
Senior Secured First Lien Notes, due 2033 | 740 |  |  | 740 |  |  | 7.000
Tax-exempt bonds | 466 |  |  | 466 |  |  | 1.250 - 4.750
Subtotal recourse debt | 8,128 |  |  | 8,220 |  |  |
Non-recourse debt: |  |  |  |  |
Vivint Senior Notes, due 2029 | 800 |  |  | 800 |  |  | 5.750
Vivint Senior Secured Notes, due 2027 | 600 |  |  | 600 |  |  | 6.750
Vivint Senior Secured Term Loan, due 2028 | 1,316 |  |  | 1,320 |  |  | SOFR + 3.36
Subtotal all Vivint non-recourse debt | 2,716 |  |  | 2,720 |  |  |
Subtotal long-term debt (including current maturities) | 10,844 |  |  | 10,940 |  |  |
Finance leases | 20 |  |  | 19 |  |  | various
Subtotal long-term debt and finance leases (including current maturities) | 10,864 |  |  | 10,959 |  |  |
Less current maturities | (1,101) |  |  | (620) |  |  |
Less debt issuance costs | (65) |  |  | (60) |  |  |
Discounts | (139) |  |  | (146) |  |  |
Total long-term debt and finance leases | $ | 9,559 |  |  | $ | 10,133 |  |  |
(a)As of the ex-dividend date of April 30, 2024, the Convertible Senior Notes were convertible at a price of $41.32, which is equivalent to a conversion rate of approximately 24.1998 shares of common stock per $1,000 principal amount Recourse Debt Senior Credit Facility Term Loan B Incurrence On April 16, 2024, the Company, as borrower, and certain of its subsidiaries, as guarantors, entered into the Eighth Amendment to the Second Amended and Restated Credit Agreement (the “Eighth Amendment”) with, among others, Citicorp North America, Inc., as administrative agent and as collateral agent (the “Agent”), and certain financial institutions, as lenders, which amended the Company’s Second Amended and Restated Credit Agreement, dated as of June 30, 2016 (the “Credit Agreement”), in order to (i) establish a new term loan B facility with borrowings of $875 million in aggregate principal amount (the “Term Loan Facility” and the loans thereunder, the “Term Loans”) and (ii) make certain other modifications to the Credit Agreement as set forth therein. The proceeds from the Term Loans were used to repay a portion of the Company’s Convertible Senior Notes and will be used to repay the Company’s 3.750% senior secured first lien notes due 2024. At the Company’s election, the Term Loans will bear interest at a rate per annum equal to either (1) a fluctuating rate equal to the highest of (A) the rate published by the Federal Reserve Bank of New York in effect on such day, plus 0.50%, (B) the rate of interest per annum publicly announced from time to time by The Wall Street Journal as the “Prime Rate” in the United States, and (C) a rate of one-month Term SOFR (as defined in the Term Loan Facility), plus 1.00%, or (2) Term SOFR (as defined in the Term Loan Facility and which rate will not be less than 0%) for a one-, three- or six-month interest period or such other period as agreed to by the Agent and the lenders, as selected by the Company, plus 2.00%. The Term Loan Facility is guaranteed by each of the Company’s subsidiaries that guarantee the Revolving Credit Facility and is secured on a first lien basis by substantially all of the Company’s and such subsidiaries’ assets, in each case, subject to certain customary exceptions and limitations set forth in the Credit Agreement. The Term Loans have a final maturity date of April 16, 2031 and amortize at a rate of 1% per annum. If an event of default occurs under the Term Loan Facility, the entire principal amount outstanding thereunder, together with all accrued unpaid interest and other amounts owing in respect thereof, may be declared immediately due and payable, subject, in certain instances, to the expiration of applicable cure periods. The Term Loan Facility also provides for customary asset sale mandatory prepayments, reporting covenants and negative covenants governing dividends, investments, indebtedness, and other matters that are customary for similar term loan B facilities. Revolving Credit Facility On April 22, 2024, the Company, as borrower, and certain of its subsidiaries, as guarantors, entered into the Ninth Amendment to the Second Amended and Restated Credit Agreement (the “Ninth Amendment”) to extend the maturity date of a portion of the revolving commitments thereunder to February 14, 2028. 2048 Convertible Senior Notes As of April 1, 2024, the Company's Convertible Senior Notes are convertible during the quarterly period ending June 30, 2024 due to the satisfaction of the Common Stock Sale Price Condition (as defined below). The Convertible Senior Notes are convertible into cash or a combination of cash and the Company’s common stock at a price of $41.53 per common share, which is the equivalent to a conversion rate of approximately 24.0763 shares of common stock per $1,000 principal amount of Convertible Senior Notes. The net carrying amounts of the Convertible Senior Notes as of March 31, 2024 and December 31, 2023 were $480 million and $572 million, respectively. The Convertible Senior Notes mature on June 1, 2048, unless earlier repurchased, redeemed or converted in accordance with their terms. The Convertible Senior notes are convertible at the option of the holders under certain circumstances. Prior to the close of business on the business day immediately preceding December 1, 2024, the Convertible Senior Notes will be convertible only upon the occurrence of certain events and during certain periods, including, among others, during any calendar quarter (and only during such calendar quarter) if the last reported sales price per share of the Company's common stock exceeds 130% of the conversion price for each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter (the "Common Stock Sale Price Condition"). Thereafter during specified periods as follows: •from December 1, 2024 until the close of business on the second scheduled trading day immediately before June 1, 2025; and •from December 1, 2047 until the close of business on the second scheduled trading day immediately before the maturity date. All conversions with a conversion date that occurs within the specific periods above will be settled after such period pursuant to the terms of the Convertible Senior Notes indenture. Repurchases During the three months ended March 31, 2024 and through April 30, 2024, the Company completed repurchases of a portion of the Convertible Senior Notes using cash on hand and a portion of the proceeds from the Term Loans, as detailed in the table below. For the three months ended March 31, 2024, a $58 million loss on debt extinguishment was recorded.
(In millions, except percentages) |  |  |  |  |  |
Settlement Period |  | Principal Repurchased |  | Cash Paid(a) |  | Average Repurchase Percentage
March 2024 |  | $ | 92 |  |  | $ | 151 |  |  | 162.356%
April 2024 |  | 251 |  |  | 452 |  |  | 179.454%
Total Repurchases |  | $ | 343 |  |  | $ | 603 |  |  |
(a)Includes accrued interest of $1 million and $2 million for the March and April repurchases, respectively The following table details the interest expense recorded in connection with the Convertible Senior Notes:
| Three months ended March 31, |  |
(In millions, except percentages) | 2024 |  | 2023 |  |  |  |
Contractual interest expense | $ | 4 |  |  | $ | 4 |  |  |  |  |
Amortization of deferred finance costs | — |  |  | 1 |  |  |  |  |
Total | $ | 4 |  |  | $ | 5 |  |  |  |  |
Effective Interest Rate | 0.78 | % |  | 0.77 | % |  |  |  |
Non-recourse Debt Vivint Term Loan Repricing On April 10, 2024, the Company’s wholly-owned indirect subsidiary, APX Group, Inc. (“Vivint”), entered into Amendment No. 2 to the Second Amended and Restated Credit Agreement (the “Second Amendment”) with, among others, Bank of America, N.A. as administrative agent (the “Vivint Agent”), and certain financial institutions, as lenders, which amended Vivint’s Second Amended and Restated Credit Agreement, dated as of June 9, 2021 (the “Vivint Credit Agreement”), in order to (i) reprice its term loan B facility (the term loans thereunder, the “Vivint Term Loans”) and (ii) make certain other changes to the Vivint Credit Agreement. From and after the closing of the Second Amendment, at Vivint’s election, the Vivint Term Loans will bear interest at a rate per annum equal to either (1) a fluctuating rate equal to the highest of (A) the rate published by the Federal Reserve Bank of New York in effect on such day, plus 0.50%, (B) the rate of interest per annum publicly announced from time to time by The Wall Street Journal as the “Prime Rate” in the United States, and (C) a rate of one-month Term SOFR (as defined in the Vivint Credit Agreement), plus 1.00%, or (2) Term SOFR (as defined in the Vivint Credit Agreement and which rate will not be less than 0.50%) for a one-, three- or six-month interest period or such other period as agreed to by the Vivint Agent and the lenders, as selected by Vivint, plus 2.75%.

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