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Long-term debt | 12 Months Ended
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Dec. 31, 2015
Debt Disclosure [Abstract] |
Long-term debt |
14. | Long-term debt
Long-term debt was comprised of the following:
|  | December 31, |
|  | 2015 |  |  | 2014 |
Senior Secured Credit Facilities: |  |  |  |  |  |  |  |
Term Loan A |  | $ | 925,000 |  |  | $ | 975,000 |
Term Loan B |  |  | 3,447,500 |  |  |  | 3,482,500 |
Senior notes |  |  | 4,500,000 |  |  |  | 3,775,000 |
Acquisition obligations and other notes payable |  |  | 70,645 |  |  |  | 69,045 |
Capital lease obligations |  |  | 283,185 |  |  |  | 218,097 |
Total debt principal outstanding |  |  | 9,226,330 |  |  |  | 8,519,642 |
Discount and deferred financing costs |  |  | (95,985 | ) |  |  | (100,864 | )
|  |  | 9,130,345 |  |  |  | 8,418,778 |
Less current portion |  |  | (129,037 | ) |  |  | (120,154 | )
|  | $ | 9,001,308 |  |  | $ | 8,298,624 |
Scheduled maturities of long-term debt at December 31, 2015 were as follows:
2016 |  |  | 129,037 |
2017 |  |  | 152,768 |
2018 |  |  | 166,132 |
2019 |  |  | 740,895 |
2020 |  |  | 65,171 |
Thereafter |  |  | 7,972,327 |
Term Loans Total outstanding borrowings under Term Loan A and Term Loan B can consist of various individual tranches that can range in maturity from one month to twelve months (currently all tranches are one month in duration). Each tranche for the Term Loan A bears interest at a London Interbank Offered Rate (LIBOR) rate determined by the duration of such tranche plus an interest rate margin, currently 1.75%. The LIBOR variable component of the interest rate for each tranche is reset as such tranche matures and a new tranche is established. At December 31, 2015, the overall weighted average interest rate for the Term Loan A was determined based upon the LIBOR interest rates in effect for all of the individual tranches plus the interest rate margin. The Company has several interest rate swap agreements that have the economic effect of fixing the majority of the Term Loan A LIBOR variable component of the Company’s interest rate, as described below. At December 31, 2015, the Term Loan B bears interest at LIBOR (floor of 0.75%) plus a margin of 2.75%. The Company is subject to a LIBOR-based floor until such time as the LIBOR-based component of the interest rate exceeds 0.75% on the Term Loan B. At such time, the Company will then be subject to LIBOR-based interest rate volatility on the LIBOR variable component of its interest rate and the overall weighted average interest rate for the Term Loan B will then be determined based upon the LIBOR interest rates in effect for all individual tranches plus the interest rate margin. The Company has several interest rate cap agreements that have the economic effect of capping the LIBOR variable component of the Company’s interest rate at a maximum of 2.50% on $2,735,000 of outstanding principal debt. The remaining $712,500 outstanding principal balance of the Term Loan B would still be subject to LIBOR-based interest rate volatility above a floor of 0.75%. In addition, the Company maintains several forward interest rate cap agreements with notional amounts totaling $7,000,000 of which $3,500,000 will be effective September 30, 2016 and the remainder of the cap agreements will be effective June 29, 2018. The cap agreements will have the economic effect of capping the LIBOR variable component of the Company’s interest rate at a maximum of 3.50% on an equivalent amount of the Company’s debt. See below for further details. During the year ended December 31, 2015, the Company made mandatory principal payments under its then existing Senior Secured Credit Facilities totaling $50,000 on the Term Loan A and $35,000 on the Term Loan B. Credit agreement and other debt transactions In June 2014 the Company entered into a Credit Agreement that consists of a five year Revolving Credit Facility in the aggregate principal amount of $1,000,000 (the Revolver), a five year Term Loan A facility in the aggregate principal amount of $1,000,000 (the Term Loan A) and a seven year Term Loan B facility in the aggregate principal amount of $3,500,000 (the Term Loan B). In addition, the Company can increase the existing revolving commitments and enter into one or more incremental term loan facilities in an amount not to exceed the sum of $1,500,000 (less the amount of other permitted indebtedness incurred or issued in reliance on such amount), plus an amount of indebtedness such that the senior secured leverage ratio is not in excess of 3.50 to 1.00 after giving effect to such borrowings. The Credit Agreement contains certain customary affirmative and negative covenants such as various restrictions or limitations on certain items depending on the Company’s leverage ratio. In addition, in June 2014, the Company issued $1,750,000 5 1/8% Senior Notes due 2024 (5 1/8% Senior Notes). The 5 1/8% Senior Notes pay interest on January 15 and July 15 and are unsecured and are guaranteed by the Company’s domestic subsidiaries as discussed above. The Company used a portion of the proceeds to pay off the total outstanding principal balances under the Company’s then existing Senior Secured Credit Facilities plus accrued interest totaling $5,362,400 and in addition, paid off the outstanding principal balances of the Company’s $775,000 6 3/8% Senior Notes plus accrued interest. The Company also terminated $1,137,500 notional amounts of amortizing swaps and also terminated $600,000 of forward swaps during June 2014. As a result of the 2014 transactions, the Company recorded debt refinancing charges of $97,548 that consist of the cash tender premiums, the redemption premium, the write-off of existing deferred financing costs, the write-off of certain new refinancing costs, other professional fees and losses associated with the termination of several of the Company’s interest rate swap agreements. In 2014, the Company made mandatory principal payments under its then existing New Senior Secured Credit Facility (before entering into a secured credit agreement and repaying all outstanding amounts under the then existing Senior Secured Credit Facilities, as discussed below) totaling $62,500 on the Term Loan A, $16,875 on the Term Loan A-3, $21,875 on the Term Loan B and $4,125 on the Term Loan B-2. Revolving lines of credit The Company has an undrawn revolving line under the Senior Secured Credit Facilities totaling $1,000,000, of which approximately $92,238 was committed for outstanding letters of credit. In addition, the Company has approximately $1,286 of committed outstanding letters of credit related to HCP, which is backed by a certificate of deposit. Senior Notes The Company’s senior notes as of December 31, 2015, consisted of $1,500,000 of 5.0% Senior Notes due 2025, $1,750,000 5 1/8% senior notes due 2024 and $1,250,000 of 5 3/4% senior notes due 2022 (collectively Senior Notes), as described below. In April 2015, the Company issued $1,500,000 5.0% Senior Notes due 2025 (5.0% Senior Notes). The 5.0% Senior Notes pay interest on May 1 and November 1 of each year beginning November 1, 2015. The 5.0% Senior Notes are unsecured senior obligations and rank equally in right of payment with the Company’s existing and future unsecured senior indebtedness. The 5.0% Senior Notes are guaranteed by certain of the Company’s domestic subsidiaries. The Company may redeem up to 35% of the 5.0% Senior Notes at any time prior to May 1, 2018 at a certain specified price from the proceeds of one or more equity offerings. In addition, the Company may redeem some or all of the 5.0% Senior Notes at any time prior to May 1, 2020 at make whole redemption rates and on or after such date at certain specified redemption prices. The net proceeds from the 5.0% Senior Notes offering were used to repurchase all of the $775,000 aggregate outstanding principal balances of 6 ⅝% Senior Notes due 2020 (6 ⅝% Senior Notes) through a combination of a tender offer and a redemption process and to pay fees and expenses. The remaining net offering proceeds will be used for general corporate purposes, future acquisitions and share repurchases. As a result of these transactions, the Company incurred $48,072 in debt redemption charges consisting of tender and redemption premiums as well as the write-off of deferred financing costs associated with the repurchase of the 6 ⅝% Senior Notes. The Senior Notes are also unsecured obligations and rank equally in right of payment with the Company’s existing and future unsecured senior indebtedness. These Senior Notes are guaranteed by substantially all of the Company’s direct and indirect wholly-owned domestic subsidiaries and require semi-annual interest payments. The Company may redeem some or all of the senior notes at any time on or after certain specific dates and at certain specific redemption prices as outlined in each senior note agreement. Interest rate swaps and caps The Company has entered into several interest rate swap agreements as a means of hedging its exposure to and volatility from variable-based interest rate changes as part of its overall interest rate risk management strategy. These agreements are not held for trading or speculative purposes and have the economic effect of converting the LIBOR variable component of the Company’s interest rate to a fixed rate. These swap agreements are designated as cash flow hedges, and as a result, hedge-effective gains or losses resulting from changes in the fair values of these swaps are reported in other comprehensive income until such time as the hedged forecasted cash flows occur, at which time the amounts are reclassified into net income. Net amounts paid or received for each specific swap tranche that have settled have been reflected as adjustments to debt expense. In addition, the Company has entered into several interest rate cap agreements and several forward interest rate cap agreements that have the economic effect of capping the Company’s maximum exposure to LIBOR variable interest rate changes on specific portions of the Company’s floating rate debt, as described below. Certain cap agreements are also designated as cash flow hedges and, as a result, changes in the fair values of these cap agreements are reported in other comprehensive income. The amortization of the original cap premium is recognized as a component of debt expense on a straight-line basis over the term of the cap agreements. The swap and cap agreements do not contain credit-risk contingent features. As of December 31, 2015, the Company maintains several interest rate swap agreements that were entered into in March 2013 with amortizing notional amounts totaling $760,000. These agreements have the economic effect of modifying the LIBOR variable component of the Company’s interest rate on an equivalent amount of the Company’s Term Loan A to fixed rates ranging from 0.49% to 0.52%, resulting in an overall weighted average effective interest rate of 2.26%, including the Term Loan A margin of 1.75%. The overall weighted average effective interest rate also includes the effects of $165,000 of unhedged Term Loan A debt that bears interest at LIBOR plus an interest rate margin of 1.75%. The swap agreements expire on September 30, 2016 and require monthly interest payments. During the year ended December 31, 2015, the Company recognized debt expense of $2,664 from these swaps. As of December 31, 2015, the total fair value of these swap agreements was a net asset of approximately $516. During the year ended December 31, 2015, the Company recorded a loss of $3,971 in other comprehensive income due to a decrease in the unrealized fair value of these swap agreements. The Company estimates that approximately $516 of existing unrealized pre-tax gains in other comprehensive income at December 31, 2015 will be reclassified into income over the next twelve months. As of December 31, 2015, the Company maintains several forward interest rate cap agreements that were entered into in October 2015 with notional amounts totaling $3,500,000. These forward cap agreements will be effective June 29, 2018 and will have the economic effect of capping the LIBOR variable component of the Company’s interest rate at a maximum of 3.50% on an equivalent amount of its debt. These cap agreements expire on June 30, 2020. As of December 31, 2015, the total fair value of these cap agreements was an asset of approximately $13,815. During the year ended December 31, 2015, the Company recorded a loss of $3,492 in other comprehensive income due to a decrease in the unrealized fair value of these cap agreements. As of December 31, 2015, the Company maintains several forward interest rate cap agreements that were entered into in November 2014 with notional amounts totaling $3,500,000. These forward cap agreements will be effective September 30, 2016 and will have the economic effect of capping the LIBOR variable component of the Company’s interest rate at a maximum of 3.50% on an equivalent amount of the Company’s debt. The cap agreements expire on June 30, 2018. As of December 31, 2015, the total fair value of these cap agreements was an asset of approximately $1,312. During the year ended December 31, 2015, the Company recorded a loss of $11,029 in other comprehensive income due to a decrease in the unrealized fair value of these cap agreements. As of December 31, 2015, the Company maintains several interest rate cap agreements that were entered into in March 2013 with notional amounts totaling $2,735,000 on the Company’s Term Loan B debt. These agreements have the economic effect of capping the LIBOR variable component of the Company’s interest rate at a maximum of 2.50% on an equivalent amount of the Company’s Term Loan B. During the year ended December 31, 2015, the Company recognized debt expense of $2,439 from these caps. The cap agreements expire on September 30, 2016. As of December 31, 2015, the total fair value of these cap agreements was immaterial. During the year ended December 31, 2015, the Company recorded a loss of $1,593 in other comprehensive income due to a decrease in the unrealized fair value of these cap agreements. The following table summarizes the Company’s derivative instruments as of December 31, 2015 and 2014:
|  | Interest rate swap and cap agreements (liabilities and assets) |
|  | December 31, 2015 |  |  | December 31, 2014 |
Derivatives designated as hedging instruments |  | Balance sheet location |  | Fair value |  |  | Balance sheet location |  | Fair value |
Interest rate swap agreements |  | Other short- term assets |  | $ | 516 |  |  | Other short- term liabilities |  | $ | 1,457 |
Interest rate swap agreements |  | Other long- term assets |  | $ | — |  |  | Other long- term assets |  | $ | 3,281 |
Interest rate cap agreements |  | Other long- term assets |  | $ | 15,127 |  |  | Other long- term assets |  | $ | 13,934 |
The following table summarizes the effects of the Company’s interest rate swap and cap agreements for the years ended December 31, 2015, 2014 and 2013:
|  | Amount of gains (losses) recognized in OCI on interest rate swap and cap agreements |  |  | Location of (losses) gains reclassified from |  | Amount of gains (losses) reclassified from accumulated OCI into income |
|  | Years ended December 31, |  |  | accumulated |  | Years ended December 31, |
Derivatives designated as cash flow hedges |  | 2015 |  |  | 2014 |  |  | 2013 |  |  | OCI into income |  | 2015 |  |  | 2014 |  |  | 2013 |
Interest rate swap agreements |  | $ | (3,971 | ) |  | $ | (8,390 | ) |  | $ | 1,251 |  |  | Debt expense |  | $ | 2,664 |  |  | $ | 12,279 |  |  | $ | 15,678 |
Interest rate cap agreements |  |  | (16,114 | ) |  |  | (8,119 | ) |  |  | (974 | ) |  | Debt expense |  |  | 2,439 |  |  |  | 5,130 |  |  |  | 5,418 |
Tax (expense) benefit |  |  | 7,844 |  |  |  | 6,450 |  |  |  | (108 | ) |  |  |  |  | (1,992 | ) |  |  | (6,801 | ) |  |  | (8,207 | )
Total |  | $ | (12,241 | ) |  | $ | (10,059 | ) |  | $ | 169 |  |  |  |  | $ | 3,111 |  |  | $ | 10,608 |  |  | $ | 12,889 |
As of December 31, 2015, the interest rate on the Company’s Term Loan B debt is effectively fixed subject to an embedded LIBOR floor which is higher than actual LIBOR as of such date and the Term Loan B is also subject to an interest rate cap if LIBOR should rise above 2.50%. See above for further details. Interest rates on the Company’s senior notes are fixed by their terms. The majority of the LIBOR variable component of the Company’s interest rates on the Company’s Term Loan A are economically fixed as a result of interest rate swaps. As a result of embedded LIBOR floors in some of the Company’s debt agreements and the swap and cap agreements, the Company’s overall weighted average effective interest rate on the Senior Secured Credit Facilities was 3.46%, based upon the current margins in effect of 1.75% for the Term Loan A and 2.75% for the Term Loan B, as of December 31, 2015. The Company’s overall weighted average effective interest rate for the year ended December 31, 2015 was 4.42% and as of December 31, 2015 was 4.39%. Debt expense Debt expense consisted of interest expense of $389,755, $385,750 and $401,140, and the amortization and accretion of debt discounts and premiums, amortization of deferred financing costs and the amortization of interest rate cap agreements of $18,625, $24,544 and $28,803 for 2015, 2014 and 2013, respectively. The interest expense amounts are net of capitalized interest.

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- Definition The entire disclosure for long-term debt. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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