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Debt
 9 Months Ended
Sep. 30, 2021
Debt Disclosure [Abstract]  
Debt

NOTE 10. DEBT

Debt obligations consist of the following:

 

 

 

Maturity Date

 

September 30,
2021

 

 

December 31,
2020

 

Term Loan Facility

 

 

 

 

 

 

 

 

Revolving Credit Facility

 

October 1, 2024

 

$

—

 

 

$

—

 

2019 Term Loan

 

October 1, 2026

 

 

1,140

 

 

 

1,188

 

2020 Term Loan

 

October 1, 2026

 

 

—

 

 

 

250

 

4.125% Senior Notes

 

July 15, 2029

 

 

350

 

 

 

—

 

Other Obligations

 

 

 

 

1

 

 

 

5

 

Total debt obligations

 

 

 

 

1,491

 

 

 

1,443

 

Less: unamortized deferred financing costs

 

 

 

 

(21

)

 

 

(28

)

Total debt, net of deferred financing costs

 

 

 

 

1,470

 

 

 

1,415

 

Less: short-term and current portion of long-term debt

 

 

 

 

(1

)

 

 

(18

)

Long-term debt, less current portion

 

 

 

$

1,469

 

 

$

1,397

 

 

Term Loan Facility

As of September 30, 2021, the Company had $1,140 of principal outstanding under the 2019 Term Loan. As of September 30, 2021, the Company had a 5-year interest rate swap with respect to $720 of notional value of the 2019 Term Loan, exchanging one-month LIBOR for a fixed rate of 1.62% per annum. Accordingly, the Company's fixed interest rate per annum on the swapped $720 notional value of the 2019 Term Loan is 4.12% through its maturity. The remaining $420 of the 2019 Term Loan balance is bearing interest at 2.58% per annum based on one-month LIBOR plus 250 basis points. Refer to Note 8 - "Derivatives" for additional information.

The interest rate applicable to borrowings under the $300 five-year senior secured revolving credit facility (the “Revolving Credit Facility”) is, at the Company’s option, either (1) a base rate plus an applicable margin equal to 1.25%, or (2) a Eurocurrency rate (adjusted for statutory reserves) plus an applicable margin equal to 2.25%.

At September 30, 2021 and December 31, 2020, the Company had no amounts outstanding under the Revolving Credit Facility, and $226 and $230 was available at September 30, 2021 and December 31, 2020, respectively, after giving effect to $74 and $70 of outstanding letters of credit.

As of September 30, 2021 and December 31, 2020, the Company was in compliance with all applicable debt covenants.

Senior Notes

During the second quarter of 2021, APi Group DE, Inc, a wholly-owned subsidiary, completed a private offering of $350 aggregate principal amount of 4.125% Senior Notes (“ 4.125% Senior Notes”) issued under an indenture dated June 22, 2021 (the “Indenture”). The 4.125% Senior Notes are fully and unconditionally guaranteed on a senior unsecured basis by the Company and certain of the Company’s existing and future domestic subsidiaries. The Company used the net proceeds from the sale of the 4.125% Senior Notes to repay the $250 million 2020 Term Loan, prepay a portion of the 2019 Term Loan and fund general corporate purposes. In connection with the repayment of the 2020 Term Loan and prepayment on the 2019 Term Loan, the Company incurred a loss on debt extinguishment of $9 related to unamortized debt issuance costs, which was recorded within loss on debt extinguishment in the unaudited condensed consolidated statements of operations.

The Indenture contains customary terms and provisions (including representations, covenants, and conditions). Certain covenants, among other things, restrict the Company's, and restricted subsidiaries’, ability to (i) incur additional indebtedness; (ii) pay dividends or make other distributions or repurchase or redeem capital stock; (iii) prepay, redeem or repurchase certain debt; (iv) make loans and investments; (v) sell, transfer and otherwise dispose of assets; (vi) incur or permit to exist certain liens; (vii) enter into transactions with affiliates; (viii) enter into agreements restricting subsidiaries’ ability to pay dividends; and (ix) consolidate, amalgamate, merge or sell all or substantially all assets. The Indenture also contains customary events of default.

The Company was in compliance with all covenants contained in the Indenture as of September 30, 2021.

Other Obligations

As of September 30, 2021 and December 31, 2020, the Company had $1 and $5 in notes outstanding, respectively, for the acquisition of equipment and vehicles.