XML 26 R14.htm IDEA: XBRL DOCUMENT
v3.23.1

DEBT | 3 Months Ended
--- | ---
Mar. 31, 2023
Debt Disclosure [Abstract] |
DEBT | 5. DEBT In accordance with the Investment Company Act, the Company is allowed to borrow amounts such that its asset coverage, calculated pursuant to the Investment Company Act, is at least 150% after such borrowing. The Company’s asset coverage requirement applicable to senior securities was reduced from 200% to 150% effective June 21, 2019. As of March 31, 2023, the aggregate principal amount outstanding of the senior securities issued by the Company was $11,196 and the Company’s asset coverage was 189%. The Company’s outstanding debt as of March 31, 2023 and December 31, 2022 was as follows:
| As of |
| March 31, 2023 |  | December 31, 2022 |
| Total Aggregate Principal Amount Committed/ Outstanding (1) |  | Principal Amount Outstanding |  | Carrying Value |  | Total Aggregate Principal Amount Committed/ Outstanding (1) |  | Principal Amount Outstanding |  | Carrying Value |
Revolving Credit Facility | $ | 4,843 |  | (2) | $ | 1,872 |  |  | $ | 1,872 |  |  | $ | 4,843 |  | (2) | $ | 2,246 |  |  | $ | 2,246 |  |
Revolving Funding Facility | 1,775 |  |  | 850 |  |  | 850 |  |  | 1,775 |  |  | 800 |  |  | 800 |  |
SMBC Funding Facility | 800 |  | (3) | 401 |  |  | 401 |  |  | 800 |  | (3) | 451 |  |  | 451 |  |
BNP Funding Facility | 500 |  |  | 320 |  |  | 320 |  |  | 300 |  |  | 245 |  |  | 245 |  |
2024 Convertible Notes | 403 |  |  | 403 |  |  | 400 |  | (4) | 403 |  |  | 403 |  |  | 399 |  | (4)
2023 Notes | — |  |  | — |  |  | — |  |  | 750 |  |  | 750 |  |  | 750 |  | (5)
2024 Notes | 900 |  |  | 900 |  |  | 899 |  | (6) | 900 |  |  | 900 |  |  | 898 |  | (6)
March 2025 Notes | 600 |  |  | 600 |  |  | 598 |  | (7) | 600 |  |  | 600 |  |  | 597 |  | (7)
July 2025 Notes | 1,250 |  |  | 1,250 |  |  | 1,257 |  | (8) | 1,250 |  |  | 1,250 |  |  | 1,258 |  | (8)
January 2026 Notes | 1,150 |  |  | 1,150 |  |  | 1,145 |  | (9) | 1,150 |  |  | 1,150 |  |  | 1,144 |  | (9)
July 2026 Notes | 1,000 |  |  | 1,000 |  |  | 991 |  | (10) | 1,000 |  |  | 1,000 |  |  | 991 |  | (10)
2027 Notes | 500 |  |  | 500 |  |  | 494 |  | (11) | 500 |  |  | 500 |  |  | 494 |  | (11)
2028 Notes | 1,250 |  |  | 1,250 |  |  | 1,247 |  | (12) | 1,250 |  |  | 1,250 |  |  | 1,247 |  | (12)
2031 Notes | 700 |  |  | 700 |  |  | 690 |  | (13) | 700 |  |  | 700 |  |  | 690 |  | (13)
Total | $ | 15,671 |  |  | $ | 11,196 |  |  | $ | 11,164 |  |  | $ | 16,221 |  |  | $ | 12,245 |  |  | $ | 12,210 |  |
________________________________________ (1)Represents the total aggregate amount committed or outstanding, as applicable, under such instrument. Borrowings under the committed Revolving Credit Facility, Revolving Funding Facility, SMBC Funding Facility and BNP Funding Facility (each as defined below) are subject to borrowing base and other restrictions. (2)Provides for a feature that allows the Company, under certain circumstances, to increase the size of the Revolving Credit Facility (as defined below) to a maximum of $7,265. (3)Provides for a feature that allows ACJB (as defined below), under certain circumstances, to increase the size of the SMBC Funding Facility (as defined below) to a maximum of $1,000. (4)Represents the aggregate principal amount outstanding of the 2024 Convertible Notes (as defined below). As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the unamortized discount for the 2024 Convertible Notes (as defined below) was $3 and $4, respectively. (5)Represents the aggregate principal amount outstanding of the 2023 Notes (as defined below), less unamortized debt issuance costs and the unamortized discount recorded upon the issuance of the 2023 Notes. As of December 31, 2022, the total unamortized debt issuance costs and the unamortized discount was $0. In February 2023, the Company repaid in full the 2023 Notes (as defined below) upon their maturity. (6)Represents the aggregate principal amount outstanding of the 2024 Notes (as defined below), less unamortized debt issuance costs and the net unamortized discount recorded upon the issuance of the 2024 Notes. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the net unamortized discount was $1 and $2, respectively. (7)Represents the aggregate principal amount outstanding of the March 2025 Notes (as defined below), less unamortized debt issuance costs and the unamortized discount recorded upon the issuance of the March 2025 Notes. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the unamortized discount was $2 and $3, respectively. (8)Represents the aggregate principal amount outstanding of the July 2025 Notes (as defined below), less unamortized debt issuance costs and the net unaccreted premium recorded upon the issuance of the July 2025 Notes. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the net unaccreted premium was $7 and $8, respectively. (9)Represents the aggregate principal amount outstanding of the January 2026 Notes (as defined below), less unamortized debt issuance costs and the unamortized discount recorded upon the issuance of the January 2026 Notes. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the unamortized discount was $5 and $6, respectively. (10)Represents the aggregate principal amount outstanding of the July 2026 Notes (as defined below), less unamortized debt issuance costs and the unamortized discount recorded upon the issuance of the July 2026 Notes. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the unamortized discount was $9 and $9, respectively. (11)Represents the aggregate principal amount outstanding of the 2027 Notes (as defined below), less unamortized debt issuance costs and the net unamortized discount recorded upon the issuance of the 2027 Notes. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the net unamortized discount was $6 and $6, respectively. (12)Represents the aggregate principal amount outstanding of the 2028 Notes (as defined below), less unamortized debt issuance costs and the net unamortized discount recorded upon the issuance of the 2028 Notes. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the net unamortized discount was $3 and $3, respectively. (13)Represents the aggregate principal amount outstanding of the 2031 Notes (as defined below), less unamortized debt issuance costs and the unamortized discount recorded upon the issuance of the 2031 Notes. As of March 31, 2023 and December 31, 2022, the total unamortized debt issuance costs and the unamortized discount was $10 and $10, respectively. The weighted average stated interest rate and weighted average maturity, both on aggregate principal amount outstanding, of all the Company’s outstanding debt as of March 31, 2023 were 4.4% and 3.5 years, respectively, and as of December 31, 2022 were 4.2% and 3.6 years, respectively. Revolving Credit Facility The Company is party to a senior secured revolving credit facility (as amended and restated, the “Revolving Credit Facility”), that allows the Company to borrow up to $4,843 at any one time outstanding. The Revolving Credit Facility consists of a $1,087 term loan tranche and a $3,756 revolving tranche. For $1,009 of the term loan tranche, the stated maturity date is March 31, 2027. For $28 of the term loan tranche, the stated maturity date is March 31, 2026. For the remaining $50 of the term loan tranche, the stated maturity date is March 30, 2025. For $3,499 of the revolving tranche, the end of the revolving period and the stated maturity date are March 31, 2026 and March 31, 2027, respectively. For $107 of the revolving tranche, the end of the revolving period and the stated maturity date are March 31, 2025 and March 31, 2026, respectively. For the remaining $150 of the revolving tranche, the end of the revolving period and the stated maturity date are March 30, 2024 and March 30, 2025, respectively. The Revolving Credit Facility also provides for a feature that allows the Company, under certain circumstances, to increase the overall size of the Revolving Credit Facility to a maximum of $7,265. The Revolving Credit Facility generally requires payments of interest at the end of each Secured Overnight Financing Rate (“SOFR”) interest period, but no less frequently than quarterly, on SOFR based loans, and monthly payments of interest on other loans. Subsequent to the end of the respective revolving periods and prior to the respective stated maturity dates, the Company is required to repay the relevant outstanding principal amounts under both the term loan tranche and revolving tranche on a monthly basis in an amount equal to 1/12th of the outstanding principal amount at the end of the respective revolving periods. See Note 14 for a subsequent event relating to the Revolving Credit Facility. Under the Revolving Credit Facility, the Company is required to comply with various covenants, reporting requirements and other customary requirements for similar revolving credit facilities, including, without limitation, covenants related to: (a) limitations on the incurrence of additional indebtedness and liens, (b) limitations on certain investments, (c) limitations on certain restricted payments, (d) maintaining a certain minimum stockholders’ equity, (e) maintaining a ratio of total assets (less total liabilities not representing indebtedness) to total indebtedness of the Company and its consolidated subsidiaries (subject to certain exceptions) of not less than 1.5:1.0, (f) limitations on pledging certain unencumbered assets, and (g) limitations on the creation or existence of agreements that prohibit liens on certain properties of the Company and certain of its subsidiaries. These covenants are subject to important limitations and exceptions that are described in the documents governing the Revolving Credit Facility. Amounts available to borrow under the Revolving Credit Facility (and the incurrence of certain other permitted debt) are also subject to compliance with a borrowing base that applies different advance rates to different types of assets (based on their value as determined pursuant to the Revolving Credit Facility) that are pledged as collateral. As of March 31, 2023, the Company was in compliance in all material respects with the terms of the Revolving Credit Facility. As of March 31, 2023 and December 31, 2022, there was $1,872 and $2,246 outstanding, respectively, under the Revolving Credit Facility. The Revolving Credit Facility also provides for a sub-limit for the issuance of letters of credit for up to an aggregate amount of $297.5 with the ability to increase by an incremental $102.5 on an uncommitted basis. As of March 31, 2023 and December 31, 2022, the Company had $93 and $86, respectively, in letters of credit issued through the Revolving Credit Facility. The amount available for borrowing under the Revolving Credit Facility is reduced by any letters of credit issued. As of March 31, 2023, there was $2,878 available for borrowing (net of letters of credit issued) under the Revolving Credit Facility, subject to borrowing base restrictions. Since March 31, 2022, the interest rate charged on the Revolving Credit Facility is based on SOFR plus a credit spread adjustment of 0.10% (or an alternate rate of interest for certain loans, commitments and/or other extensions of credit denominated in Sterling, Canadian Dollars, Euros and certain other foreign currencies plus a spread adjustment, if applicable) and an applicable spread of either 1.75% or 1.875% or an “alternate base rate” (as defined in the agreements governing the Revolving Credit Facility) plus an applicable spread of 0.75% or 0.875%, in each case, determined monthly based on the total amount of the borrowing base relative to the sum of (i) the greater of (a) the aggregate amount of revolving exposure and term loans outstanding under the Revolving Credit Facility and (b) 85% of the total commitments of the Revolving Credit Facility (or, if higher, the total revolving exposure) plus (ii) other debt, if any, secured by the same collateral as the Revolving Credit Facility. The Revolving Credit Facility allows for borrowings to be made using one, three or six month SOFR. Prior to March 31, 2022, the interest rate charged on the Revolving Credit Facility was based on LIBOR (or an alternate rate of interest for certain loans, commitments and/or other extensions of credit denominated in Sterling, Canadian Dollars, Euros and certain other foreign currencies) plus an applicable spread of either 1.75% or 1.875% or an “alternate base rate” (as defined in the agreements governing the Revolving Credit Facility) plus an applicable spread of 0.75% or 0.875%, in each case, determined monthly based on the total amount of the borrowing base relative to the sum of (i) the greater of (a) the aggregate amount of revolving exposure and term loans outstanding under the Revolving Credit Facility and (b) 85% of the total commitments of the Revolving Credit Facility (or, if higher, the total revolving exposure) plus (ii) other debt, if any, secured by the same collateral as the Revolving Credit Facility. As of March 31, 2023, the one, three and six month SOFR was 4.81%, 4.91% and 4.90%, respectively. As of March 31, 2023, the applicable spread in effect was 1.75%. In addition to the stated interest expense on the Revolving Credit Facility, the Company is required to pay a commitment fee of 0.375% per annum on any unused portion of the Revolving Credit Facility. The Company is also required to pay a letter of credit fee of either 2.00% or 2.125% per annum on letters of credit issued, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility. The Revolving Credit Facility is secured by certain assets in the Company’s portfolio and excludes investments held by Ares Capital CP under the Revolving Funding Facility, those held by ACJB under the SMBC Funding Facility and those held by AFB under the BNP Funding Facility, each as described below, and certain other investments. For the three months ended March 31, 2023 and 2022, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the Revolving Credit Facility were as follows:
| For the Three Months Ended March 31, |  |
| 2023 |  | 2022 |  |  |  |  |  |
Stated interest expense | $ | 34 |  |  | $ | 6 |  |  |  |  |  |  |
Credit facility fees | 3 |  |  | 2 |  |  |  |  |  |  |
Amortization of debt issuance costs | 2 |  |  | 1 |  |  |  |  |  |  |
Total interest and credit facility fees expense | $ | 39 |  |  | $ | 9 |  |  |  |  |  |  |
Cash paid for interest expense | $ | 32 |  |  | $ | 9 |  |  |  |  |  |  |
Average stated interest rate | 6.35 | % |  | 2.36 | % |  |  |  |  |  |
Average outstanding balance | $ | 2,117 |  |  | $ | 1,078 |  |  |  |  |  |  |
Revolving Funding Facility The Company and the Company’s consolidated subsidiary, Ares Capital CP Funding LLC (“Ares Capital CP”), are party to a revolving funding facility (as amended, the “Revolving Funding Facility”), that allows Ares Capital CP to borrow up to $1,775 at any one time outstanding. The Revolving Funding Facility is secured by all of the assets held by, and the membership interest in, Ares Capital CP. The end of the reinvestment period and the stated maturity date for the Revolving Funding Facility are December 29, 2024 and December 29, 2026, respectively. Amounts available to borrow under the Revolving Funding Facility are subject to a borrowing base that applies different advance rates to different types of assets held by Ares Capital CP. Ares Capital CP is also subject to limitations with respect to the loans securing the Revolving Funding Facility, including restrictions on sector concentrations, loan size, payment frequency and status, collateral interests and loans with fixed rates, as well as restrictions on portfolio company leverage, all of which may also affect the borrowing base and therefore amounts available to borrow. The Company and Ares Capital CP are also required to comply with various covenants, reporting requirements and other customary requirements for similar facilities. These covenants are subject to important limitations and exceptions that are described in the agreements governing the Revolving Funding Facility. As of March 31, 2023, the Company and Ares Capital CP were in compliance in all material respects with the terms of the Revolving Funding Facility. As of March 31, 2023 and December 31, 2022, there was $850 and $800 outstanding, respectively, under the Revolving Funding Facility. Since June 30, 2022, the interest rate charged on the Revolving Funding Facility is based on SOFR plus a credit spread adjustment of 0.10% or a “base rate” (as defined in the agreements governing the Revolving Funding Facility) plus an applicable spread of 1.90% per annum. From December 29, 2021 to June 29, 2022, the interest rate charged on the Revolving Funding Facility is based on one month LIBOR plus 1.90% per annum or a “base rate” (as defined in the agreements governing the Revolving Funding Facility) plus 1.00% per annum. For the three months ended March 31, 2023 and 2022, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the Revolving Funding Facility were as follows:
| For the Three Months Ended March 31, |  |
| 2023 |  | 2022 |  |  |  |  |  |
Stated interest expense | $ | 13 |  |  | $ | 3 |  |  |  |  |  |  |
Credit facility fees | 1 |  |  | 1 |  |  |  |  |  |  |
Amortization of debt issuance costs | 1 |  |  | 1 |  |  |  |  |  |  |
Total interest and credit facility fees expense | $ | 15 |  |  | $ | 5 |  |  |  |  |  |  |
Cash paid for interest expense | $ | 12 |  |  | $ | 3 |  |  |  |  |  |  |
Average stated interest rate | 6.46 | % |  | 2.01 | % |  |  |  |  |  |
Average outstanding balance | $ | 812 |  |  | $ | 766 |  |  |  |  |  |  |
SMBC Funding Facility The Company and the Company’s consolidated subsidiary, Ares Capital JB Funding LLC (“ACJB”), are party to a revolving funding facility (as amended, the “SMBC Funding Facility”), with ACJB, as the borrower, and Sumitomo Mitsui Banking Corporation, as the administrative agent and collateral agent, that allows ACJB to borrow up to $800 at any one time outstanding. The SMBC Funding Facility also provides for a feature that allows ACJB, subject to receiving certain consents, to increase the overall size of the SMBC Funding Facility to $1,000. The SMBC Funding Facility is secured by all of the assets held by ACJB. The end of the reinvestment period and the stated maturity date for the SMBC Funding Facility are May 28, 2024 and May 28, 2026, respectively. The reinvestment period and the stated maturity date are both subject to two one-year extensions by mutual agreement. Amounts available to borrow under the SMBC Funding Facility are subject to a borrowing base that applies an advance rate to assets held by ACJB. ACJB is also subject to limitations with respect to the loans securing the SMBC Funding Facility, including restrictions on sector concentrations, loan size, payment frequency and status, collateral interests and loans with fixed rates, as well as restrictions on portfolio company leverage, all of which may also affect the borrowing base and therefore amounts available to borrow. The Company and ACJB are also required to comply with various covenants, reporting requirements and other customary requirements for similar facilities. These covenants are subject to important limitations and exceptions that are described in the documents governing the SMBC Funding Facility. As of March 31, 2023, the Company and ACJB were in compliance in all material respects with the terms of the SMBC Funding Facility. As of March 31, 2023 and December 31, 2022, there was $401 and $451 outstanding, respectively, under the SMBC Funding Facility. The interest rate charged on the SMBC Funding Facility is based on an applicable spread of either 1.75% or 2.00% over one month LIBOR or 0.75% or 1.00% over a “base rate” (as defined in the agreements governing the SMBC Funding Facility), in each case, determined monthly based on the amount of the average borrowings outstanding under the SMBC Funding Facility. As of March 31, 2023, the applicable spread in effect was 1.75%. ACJB is required to pay a commitment fee of between 0.50% and 1.00% per annum depending on the size of the unused portion of the SMBC Funding Facility. For the three months ended March 31, 2023 and 2022, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the SMBC Funding Facility were as follows:
| For the Three Months Ended March 31, |  |
| 2023 |  | 2022 |  |  |  |  |  |
Stated interest expense | $ | 7 |  |  | $ | 2 |  |  |  |  |  |  |
Credit facility fees | 1 |  |  | — |  |  |  |  |  |  |
Amortization of debt issuance costs | 1 |  |  | 1 |  |  |  |  |  |  |
Total interest and credit facility fees expense | $ | 9 |  |  | $ | 3 |  |  |  |  |  |  |
Cash paid for interest expense | $ | 7 |  |  | $ | 2 |  |  |  |  |  |  |
Average stated interest rate | 6.27 | % |  | 2.26 | % |  |  |  |  |  |
Average outstanding balance | $ | 427 |  |  | $ | 405 |  |  |  |  |  |  |
BNP Funding Facility The Company and the Company’s consolidated subsidiary, ARCC FB Funding LLC (“AFB”), are party to a revolving funding facility (as amended, the “BNP Funding Facility”) with AFB, as the borrower, and BNP Paribas, as the administrative agent and lender, that allows AFB to borrow up to $500 at any one time outstanding. The BNP Funding Facility is secured by all of the assets held by AFB. The end of the reinvestment period and the stated maturity date for the BNP Funding Facility are June 11, 2023 and June 11, 2025, respectively. The reinvestment period and the stated maturity date are both subject to a one-year extension by mutual agreement. See Note 14 for a subsequent event relating to the BNP Funding Facility. Amounts available to borrow under the BNP Funding Facility are subject to a borrowing base that applies an advance rate to assets held by AFB. AFB is also subject to limitations with respect to the loans securing the BNP Funding Facility, including restrictions on sector concentrations, loan size, payment frequency and status, collateral interests and loans with fixed rates, as well as restrictions on portfolio company leverage, all of which may also affect the borrowing base and therefore amounts available to borrow. The Company and AFB are also required to comply with various covenants, reporting requirements and other customary requirements for similar facilities. These covenants are subject to important limitations and exceptions that are described in the documents governing the BNP Funding Facility. As of March 31, 2023, the Company and AFB were in compliance in all material respects with the terms of the BNP Funding Facility. As of March 31, 2023 and December 31, 2022, there was $320 and $245, respectively, outstanding under the BNP Funding Facility. Since January 9, 2023, the interest rate charged on the BNP Funding Facility was based on an applicable SOFR or a “base rate” plus a margin of (i) 2.30% during the reinvestment period and (ii) 2.80% following the reinvestment period. Prior to January 9, 2023, the interest rate charged on the BNP Funding Facility was based on three month LIBOR, or a “base rate” (as defined in the agreements governing the BNP Funding Facility) plus a margin of (i) 1.80% during the reinvestment period and (ii) 2.30% following the reinvestment period. As of March 31, 2023, the applicable spread in effect was 2.30%. AFB is required to pay a commitment fee of between 0.00% and 1.25% per annum depending on the size of the unused portion of the BNP Funding Facility. See Note 14 for a subsequent event relating to the BNP Funding Facility. For the three months ended March 31, 2023 and 2022, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the BNP Funding Facility were as follows:
| For the Three Months Ended March 31, |  |
| 2023 |  | 2022 |  |  |  |
Stated interest expense | $ | 5 |  |  | $ | — |  |  |  |  |
Credit facility fees | — |  |  | — |  |  |  |  |
Amortization of debt issuance costs | — |  |  | — |  |  |  |  |
Total interest and credit facility fees expense | $ | 5 |  |  | $ | — |  |  |  |  |
Cash paid for interest expense | $ | 5 |  |  | $ | — |  |  |  |  |
Average stated interest rate | 6.80 | % |  | 1.94 | % |  |  |  |
Average outstanding balance | $ | 314 |  |  | $ | 46 |  |  |  |  |
Convertible Unsecured Notes The Company has issued $403 in aggregate principal amount of unsecured convertible notes that mature on March 1, 2024 (the “2024 Convertible Notes”) unless previously converted or repurchased in accordance with its terms. The Company does not have the right to redeem the 2024 Convertible Notes prior to maturity. The 2024 Convertible Notes bear interest at a rate of 4.625% per annum, payable semi-annually. In certain circumstances, assuming the conversion date below has not already passed, the 2024 Convertible Notes will be convertible into cash, shares of the Company’s common stock or a combination of cash and shares of its common stock, at the Company’s election, at the conversion rate (listed below as of March 31, 2023) subject to customary anti-dilution adjustments and the requirements of the indenture (the “2024 Convertible Notes Indenture”). Prior to the close of business on the business day immediately preceding the conversion date (listed below), holders may convert their 2024 Convertible Notes only under certain circumstances set forth in the 2024 Convertible Notes Indenture. On or after the conversion date until the close of business on the second scheduled trading day immediately preceding the maturity date for the 2024 Convertible Notes, holders may convert their 2024 Convertible Notes at any time. In addition, if the Company engages in certain corporate events as described in the 2024 Convertible Notes Indenture, holders of the 2024 Convertible Notes may require the Company to repurchase for cash all or part of the 2024 Convertible Notes at a repurchase price equal to 100% of the principal amount of the 2024 Convertible Notes to be repurchased, plus accrued and unpaid interest through, but excluding, the required repurchase date. Certain key terms related to the convertible features for the 2024 Convertible Notes as of March 31, 2023 are listed below.
|  |  | 2024 Convertible Notes
Conversion premium |  |  | 15.0 | %
Closing stock price at issuance |  |  | $ | 17.29 |
Closing stock price date |  |  | March 5, 2019
Conversion price (1) |  |  | $ | 19.62 |
Conversion rate (shares per one thousand dollar principal amount)(1) |  |  | 50.9784 |
Conversion date |  |  | December 1, 2023
________________________________________ (1)Represents conversion price and conversion rate, as applicable, as of March 31, 2023, taking into account any applicable de minimis adjustments that will be made on the conversion date. As of March 31, 2023, the principal amount of the 2024 Convertible Notes exceeded the value of the underlying shares multiplied by the per share closing price of the Company’s common stock. The 2024 Convertible Notes Indenture contains certain covenants, including covenants requiring the Company to comply with Section 18(a)(1)(A) as modified by Section 61(a) of the Investment Company Act, or any successor provisions, and to provide financial information to the holders of the 2024 Convertible Notes under certain circumstances. These covenants are subject to important limitations and exceptions that are described in the 2024 Convertible Notes Indenture. As of March 31, 2023, the Company was in compliance in all material respects with the terms of the 2024 Convertible Notes Indenture. The 2024 Convertible Notes as well as any other convertible notes outstanding during the periods presented (collectively referred to as the “Convertible Unsecured Notes”) are accounted for in accordance with ASC 470-20, Debt. Upon conversion of the 2024 Convertible Notes, the Company intends to pay the outstanding principal amount in cash and to the extent that the conversion value exceeds the principal amount, the Company has the option to pay in cash or shares of the Company’s common stock (or a combination of cash and shares) in respect of the excess amount, subject to the requirements of the 2024 Convertible Notes Indenture. The Company has determined that the embedded conversion options in the 2024 Convertible Notes are not required to be separately accounted for as a derivative under GAAP. In connection with the issuance of the 2024 Convertible Notes, the Company incurred debt issuance costs of $4. The 2024 Convertible Notes were issued at a discount. The Company records interest expense comprised of both stated interest expense as well as accretion of any original issue discount or debt issuance costs. As of March 31, 2023, the components of the carrying value of the 2024 Convertible Notes, the stated interest rate and the effective interest rate were as follows:
|  |  |  | 2024 Convertible Notes
Principal amount of debt |  |  |  | $ | 403 |
Original issue discount, net of accretion |  |  |  | — |
Debt issuance costs, net of amortization |  |  |  | (3) |
Carrying value of debt |  |  |  | $ | 400 |
Stated interest rate |  |  |  | 4.625 | %
Effective interest rate(1) |  |  |  | 5.10 | %
________________________________________ (1)The effective interest rate of the 2024 Convertible Notes is equal to the stated interest rate plus the accretion of original issue discount and amortization of debt issuance costs. For the three months ended March 31, 2023 and 2022, the components of interest expense and cash paid for interest expense for the 2024 Convertible Notes, as well as any other convertible notes outstanding during the periods presented were as follows.
| For the Three Months Ended March 31, |  |
| 2023 |  | 2022 |  |  |  |  |  |
Stated interest expense | $ | 5 |  |  | $ | 6 |  |  |  |  |  |  |
Accretion of original issue discount | 1 |  |  | 1 |  |  |  |  |  |  |
Total interest expense | $ | 6 |  |  | $ | 7 |  |  |  |  |  |  |
Cash paid for interest expense | $ | 9 |  |  | $ | 17 |  |  |  |  |  |  |
Unsecured Notes The Company has issued certain unsecured notes (each issuance of which is referred to herein using the “defined term” set forth under the “Unsecured Notes” column of the table below and collectively referred to as the “Unsecured Notes”), that pay interest semi-annually and all principal amounts are due upon maturity. Each of the Unsecured Notes may be redeemed in whole or in part at any time at the Company’s option at a redemption price equal to par plus a “make whole” premium, if applicable, as determined pursuant to the indentures governing each of the Unsecured Notes, plus any accrued and unpaid interest. Certain key terms related to the features for the Unsecured Notes as of March 31, 2023 are listed below.
Unsecured Notes | Aggregate Principal Amount Issued |  | Interest Rate |  | Original Issuance Date |  | Maturity Date
2024 Notes | $ | 900 |  |  | 4.200% |  | June 10, 2019 |  | June 10, 2024
March 2025 Notes | $ | 600 |  |  | 4.250% |  | January 11, 2018 |  | March 1, 2025
July 2025 Notes | $ | 1,250 |  |  | 3.250% |  | January 15, 2020 |  | July 15, 2025
January 2026 Notes | $ | 1,150 |  |  | 3.875% |  | July 15, 2020 |  | January 15, 2026
July 2026 Notes | $ | 1,000 |  |  | 2.150% |  | January 13, 2021 |  | July 15, 2026
2027 Notes | $ | 500 |  |  | 2.875% |  | January 13, 2022 |  | June 15, 2027
2028 Notes | $ | 1,250 |  |  | 2.875% |  | June 10, 2021 |  | June 15, 2028
2031 Notes | $ | 700 |  |  | 3.200% |  | November 4, 2021 |  | November 15, 2031
In February 2023, the Company repaid in full the $750 in aggregate principal amount outstanding of unsecured notes (the “2023 Notes”) upon their maturity. The 2023 Notes bore interest at a rate of 3.500% per annum, payable semi-annually. For the three months ended March 31, 2023 and 2022, the components of interest expense and cash paid for interest expense for the Unsecured Notes, as well as any other unsecured notes outstanding during the periods presented are listed below.
| For the Three Months Ended March 31, |  |
| 2023 |  | 2022 |  |  |  |  |  |
Stated interest expense | $ | 64 |  |  | $ | 67 |  |  |  |  |  |  |
Amortization of debt issuance costs | 3 |  |  | 4 |  |  |  |  |  |  |
Net amortization of original issue premium/discount | (2) |  |  | (2) |  |  |  |  |  |  |
Total interest expense | $ | 65 |  |  | $ | 69 |  |  |  |  |  |  |
Cash paid for interest expense | $ | 79 |  |  | $ | 79 |  |  |  |  |  |  |
The Unsecured Notes contain certain covenants, including covenants requiring the Company to comply with Section 18(a)(1)(A) as modified by Section 61(a) of the Investment Company Act, or any successor provisions, and to provide financial information to the holders of such notes under certain circumstances. These covenants are subject to important limitations and exceptions set forth in the indentures governing such notes. As of March 31, 2023, the Company was in compliance in all material respects with the terms of the respective indentures governing each of the Unsecured Notes. The 2024 Convertible Notes and the Unsecured Notes are the Company’s senior unsecured obligations and rank senior in right of payment to any future indebtedness that is expressly subordinated in right of payment to the 2024 Convertible Notes and the Unsecured Notes; equal in right of payment to the Company’s existing and future unsecured indebtedness that is not expressly subordinated; effectively junior in right of payment to any of its secured indebtedness (including existing unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company’s subsidiaries, financing vehicles or similar facilities.

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI https://asc.fasb.org/topic&trid=2208564 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (h) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (c) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (g) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1E -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (i) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 + Details
Name: | us-gaap_DebtDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration