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LONG-TERM DEBT, NET | 9 Months Ended
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Sep. 30, 2022
Debt Disclosure [Abstract] |
LONG-TERM DEBT, NET | NOTE 5—LONG-TERM DEBT, NET Long-term debt consists of:
| September 30, 2022 |  | December 31, 2021
| (In thousands)
Credit Facility due February 13, 2025 | $ | — |  |  | $ | — |
Term Loan due February 13, 2027 | 425,000 |  |  | 425,000 |
5.00% Senior Notes due December 15, 2027 (the “5.00% Senior Notes”); interest payable each June 15 and December 15 | 450,000 |  |  | 450,000 |
4.625% Senior Notes due June 1, 2028 (the “4.625% Senior Notes”); interest payable each June 1 and December 1 | 500,000 |  |  | 500,000 |
5.625% Senior Notes due February 15, 2029 (the “5.625% Senior Notes”); interest payable each February 15 and August 15 | 350,000 |  |  | 350,000 |
4.125% Senior Notes due August 1, 2030 (the “4.125% Senior Notes”); interest payable each February 1 and August 1 | 500,000 |  |  | 500,000 |
3.625% Senior Notes due October 1, 2031 (the “3.625% Senior Notes”); interest payable each April 1 and October 1 commencing on April 1, 2022 | 500,000 |  |  | 500,000 |
0.875% Exchangeable Senior Notes due October 1, 2022 (the “2022 Exchangeable Notes”); interest payable each April 1 and October 1 | 44,273 |  |  | 100,500 |
0.875% Exchangeable Senior Notes due June 15, 2026 (the “2026 Exchangeable Notes”); interest payable each June 15 and December 15 | 575,000 |  |  | 575,000 |
2.00% Exchangeable Senior Notes due January 15, 2030 (the “2030 Exchangeable Notes”); interest payable each January 15 and July 15 | 575,000 |  |  | 575,000 |
Total debt | 3,919,273 |  |  | 3,975,500 |
Less: Current maturities of long-term debt | 44,273 |  |  | 100,500 |
Less: Unamortized original issue discount | 4,582 |  |  | 5,215 |
Less: Unamortized debt issuance costs | 36,293 |  |  | 40,364 |
Total long-term debt, net | $ | 3,834,125 |  |  | $ | 3,829,421 |
Credit Facility and Term Loan Our wholly-owned subsidiary, Match Group Holdings II, LLC (“MG Holdings II”), is the borrower under a credit agreement (as amended, the “Credit Agreement”) that provides for the Credit Facility and the Term Loan. The Credit Agreement provides for a benchmark replacement should the LIBOR rate not be available in the future. The rate used would be agreed to between the administrative agent and the Company and may be based upon a secured overnight financing rate at the Federal Reserve Bank of New York. Additional information about the benchmark replacement can be found in Amendment No. 6 to the Credit Agreement. The Credit Facility has a borrowing capacity of $750 million and matures on February 13, 2025. At both September 30, 2022 and December 31, 2021, there were no outstanding borrowings, $0.4 million in outstanding letters of credit, and $749.6 million of availability under the Credit Facility. The annual commitment fee on undrawn funds, which is based on MG Holdings II’s consolidated net leverage ratio, was 25 basis points as of September 30, 2022. Borrowings under the Credit Facility bear interest, at MG Holdings II’s option, at a base rate or LIBOR, in each case plus an applicable margin, based on MG Holdings II’s consolidated net leverage ratio. If MG Holdings II borrows under the Credit Facility, it will be required to maintain a consolidated net leverage ratio of not more than 5.0 to 1.0. At both September 30, 2022 and December 31, 2021, the outstanding balance on the Term Loan was $425 million. The Term Loan bears interest at LIBOR plus 1.75%, which was 4.69% and 1.91% at September 30, 2022 and December 31, 2021, respectively. The Term Loan matures on February 13, 2027. Interest payments are due at least quarterly through the term of the loan. The Term Loan provides for annual principal payments as part of an excess cash flow sweep provision, the amount of which, if any, is governed by the secured net leverage ratio as set forth in the Credit Agreement. The Credit Agreement includes covenants that would limit the ability of MG Holdings II to pay dividends, make distributions, or repurchase MG Holdings II’s stock in the event MG Holdings II’s secured net leverage ratio exceeds 2.0 to 1.0, while the Term Loan remains outstanding and, thereafter, if MG Holdings II’s consolidated net leverage ratio exceeds 4.0 to 1.0, or if an event of default has occurred. The Credit Agreement includes additional covenants that limit the ability of MG Holdings II and its subsidiaries to, among other things, incur indebtedness, pay dividends or make distributions. Obligations under the Credit Facility and Term Loan are unconditionally guaranteed by certain MG Holdings II wholly-owned domestic subsidiaries and are also secured by the stock of certain MG Holdings II domestic and foreign subsidiaries. The Term Loan and outstanding borrowings, if any, under the Credit Facility, rank equally with each other, and have priority over the Senior Notes to the extent of the value of the assets securing the borrowings under the Credit Agreement. Senior Notes The 5.00% Senior Notes were issued on December 4, 2017. At any time prior to December 15, 2022, these notes may be redeemed at a redemption price equal to the sum of the principal amount, plus accrued and unpaid interest and a make-whole premium set forth in the indenture governing the notes. Thereafter, these notes may be redeemed at redemption prices set forth in the indenture governing the notes, together with accrued and unpaid interest to the applicable redemption date. The 4.625% Senior Notes were issued on May 19, 2020. At any time prior to June 1, 2023, these notes may be redeemed at a redemption price equal to the sum of the principal amount, plus accrued and unpaid interest and a make-whole premium set forth in the indenture governing the notes. Thereafter, these notes may be redeemed at redemption prices set forth in the indenture governing the notes, together with accrued and unpaid interest to the applicable redemption date. The 5.625% Senior Notes were issued on February 15, 2019. At any time prior to February 15, 2024, these notes may be redeemed at a redemption price equal to the sum of the principal amount, plus accrued and unpaid interest and a make-whole premium set forth in the indenture governing the notes. Thereafter, these notes may be redeemed at redemption prices set forth in the indenture governing the notes, together with accrued and unpaid interest to the applicable redemption date. The 4.125% Senior Notes were issued on February 11, 2020. At any time prior to May 1, 2025, these notes may be redeemed at a redemption price equal to the sum of the principal amount, plus accrued and unpaid interest and a make-whole premium set forth in the indenture governing the notes. Thereafter, these notes may be redeemed at redemption prices set forth in the indenture governing the notes, together with accrued and unpaid interest to the applicable redemption date. The 3.625% Senior Notes were issued on October 4, 2021. At any time prior to October 1, 2026, these notes may be redeemed at a redemption price equal to the sum of the principal amount, plus accrued and unpaid interest and a make-whole premium set forth in the indenture governing the notes. Thereafter, these notes may be redeemed at redemption prices set forth in the indenture governing the notes, together with accrued and unpaid interest to the applicable redemption date. The indenture governing the 5.00% Senior Notes contains covenants that would limit MG Holdings II’s ability to pay dividends or to make distributions and repurchase or redeem MG Holdings II’s stock in the event a default has occurred or MG Holdings II’s consolidated leverage ratio (as defined in the indenture) exceeds 5.0 to 1.0. No such limitations were in effect at September 30, 2022. There are additional covenants in the 5.00% Senior Notes indenture that limit the ability of MG Holdings II and its subsidiaries to, among other things, (i) incur indebtedness, make investments, or sell assets in the event MG Holdings II is not in compliance with specified financial ratios, and (ii) incur liens, enter into agreements restricting their ability to pay dividends, enter into transactions with affiliates, or consolidate, merge or sell substantially all of their assets. The indentures governing the 3.625%, 4.125%, 4.625%, and 5.625% Senior Notes are less restrictive than the indenture governing the 5.00% Senior Notes and generally only limit MG Holdings II’s and its subsidiaries’ ability to, among other things, create liens on assets, or consolidate, merge, sell or otherwise dispose of all or substantially all of their assets. The Senior Notes all rank equally in right of payment. Exchangeable Notes During 2017, Match Group FinanceCo, Inc., a direct, wholly-owned subsidiary of the Company, issued $517.5 million aggregate principal amount of its 2022 Exchangeable Notes. During 2019, Match Group FinanceCo 2, Inc. and Match Group FinanceCo 3, Inc., direct, wholly-owned subsidiaries of the Company, issued $575.0 million aggregate principal amount of its 2026 Exchangeable Notes, and $575.0 million aggregate principal amount of its 2030 Exchangeable Notes, respectively. The 2022, 2026, and 2030 Exchangeable Notes (collectively the “Exchangeable Notes”) are guaranteed by the Company but are not guaranteed by MG Holdings II or any of its subsidiaries. The following table presents details of the exchangeable features:
| Number of shares of the Company’s Common Stock into which each $1,000 of Principal of the Exchangeable Notes is Exchangeable(a) |  | Approximate Equivalent Exchange Price per Share(a) |  | Exchangeable Date
2022 Exchangeable Notes | 22.7331 |  | $ | 43.99 |  |  | July 1, 2022
2026 Exchangeable Notes | 11.4259 |  | $ | 87.52 |  |  | March 15, 2026
2030 Exchangeable Notes | 11.8739 |  | $ | 84.22 |  |  | October 15, 2029
______________________ (a)Subject to adjustment upon the occurrence of specified events. As more specifically set forth in the applicable indentures, the Exchangeable Notes are exchangeable under the following circumstances: (1) during any calendar quarter (and only during such calendar quarter), if the last reported sale price of the Company's common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the exchange price on each applicable trading day; (2) during the five-business day period after any five-consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company's common stock and the exchange rate on each such trading day; (3) if the issuer calls the notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or (4) upon the occurrence of specified corporate events as further described in the indentures governing the respective Exchangeable Notes. On or after the respective exchangeable dates noted in the table above, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may exchange all or any portion of their Exchangeable Notes regardless of the foregoing conditions. Upon exchange, the issuer, in its sole discretion, has the option to settle the Exchangeable Notes with cash, shares of the Company’s common stock, or a combination of cash and shares of the Company's common stock. Any shares issued in further settlement of the notes would be offset by shares received upon exercise of the Exchangeable Note Hedges (described below). The 2022 Exchangeable Notes outstanding immediately prior to maturity on October 1, 2022, totaling $44.3 million aggregate principle amount, were presented by holders for exchange on or before September 30, 2022 with settlement to occur entirely in cash in early October 2022, in accordance with their terms. Additionally, during the nine months ended September 30, 2022, $56.2 million aggregate principal amount of the 2022 Exchangeable Notes were settled related to notes presented for exchange in the current period or prior periods, including $40.6 million presented for exchange during the nine months ended September 30, 2022. No other Exchangeable Notes were presented for exchange during the nine months ended September 30, 2022. Neither of the 2026 and 2030 Exchangeable Notes were exchangeable as of September 30, 2022. The following table presents the if-converted value that exceeded the principal of each Exchangeable Note outstanding as of September 30, 2022 and December 31, 2021 based on the Company’s stock price on September 30, 2022 and December 31, 2021, respectively.
| September 30, 2022 |  | December 31, 2021
| (In millions)
2022 Exchangeable Notes | $ | 3.8 |  |  | $ | 170.4 |
2026 Exchangeable Notes | $ | — |  |  | $ | 293.9 |
2030 Exchangeable Notes | $ | — |  |  | $ | 327.9 |
Additionally, all or any portion of the 2026 Exchangeable Notes and 2030 Exchangeable Notes may be redeemed for cash, at the respective issuer’s option, on or after June 20, 2023 and July 20, 2026, respectively, if the last reported sale price of the Company’s common stock has been at least 130% of the exchange price then in effect for at least 20 trading days (whether or not consecutive), including at least one of the five trading days immediately preceding the date on which the notice of redemption is provided, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the applicable issuer provides notice of redemption, at a redemption price equal to 100% of the principal amount to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. The following table sets forth the components of the outstanding Exchangeable Notes as of September 30, 2022 and December 31, 2021:
| September 30, 2022 |  | December 31, 2021
| 2022 Exchangeable Notes |  | 2026 Exchangeable Notes |  | 2030 Exchangeable Notes |  | 2022 Exchangeable Notes |  | 2026 Exchangeable Notes |  | 2030 Exchangeable Notes
| (In thousands)
Principal | $ | 44,273 |  |  | $ | 575,000 |  |  | $ | 575,000 |  |  | $ | 100,500 |  |  | $ | 575,000 |  |  | $ | 575,000 |
Less: Unamortized debt issuance costs | — |  |  | 5,958 |  |  | 7,895 |  |  | 573 |  |  | 7,130 |  |  | 8,638 |
Net carrying value included in current maturities of long-term debt, net | $ | 44,273 |  |  | $ | — |  |  | $ | — |  |  | $ | 99,927 |  |  | $ | — |  |  | $ | — |
Net carrying value included in long-term debt, net | $ | — |  |  | $ | 569,042 |  |  | $ | 567,105 |  |  | $ | — |  |  | $ | 567,870 |  |  | $ | 566,362 |
The following table sets forth interest expense recognized related to the Exchangeable Notes:
| Three Months Ended September 30, 2022 |  | Three Months Ended September 30, 2021
| 2022 Exchangeable Notes |  | 2026 Exchangeable Notes |  | 2030 Exchangeable Notes |  | 2022 Exchangeable Notes |  | 2026 Exchangeable Notes |  | 2030 Exchangeable Notes
| (In thousands)
Contractual interest expense | $ | 13 |  |  | $ | 1,257 |  |  | $ | 2,875 |  |  | $ | 1,132 |  |  | $ | 1,257 |  |  | $ | 2,875 |
Amortization of debt issuance costs | 102 |  |  | 395 |  |  | 250 |  |  | 930 |  |  | 390 |  |  | 244 |
Total interest expense recognized | $ | 115 |  |  | $ | 1,652 |  |  | $ | 3,125 |  |  | $ | 2,062 |  |  | $ | 1,647 |  |  | $ | 3,119 |
| Nine Months Ended September 30, 2022 |  | Nine Months Ended September 30, 2021
| 2022 Exchangeable Notes |  | 2026 Exchangeable Notes |  | 2030 Exchangeable Notes |  | 2022 Exchangeable Notes |  | 2026 Exchangeable Notes |  | 2030 Exchangeable Notes
| (In thousands)
Contractual interest expense | $ | 366 |  |  | $ | 3,773 |  |  | $ | 8,625 |  |  | $ | 3,396 |  |  | $ | 3,773 |  |  | $ | 8,625 |
Amortization of debt issuance costs | 401 |  |  | 1,172 |  |  | 743 |  |  | 2,757 |  |  | 1,178 |  |  | 744 |
Total interest expense recognized | $ | 767 |  |  | $ | 4,945 |  |  | $ | 9,368 |  |  | $ | 6,153 |  |  | $ | 4,951 |  |  | $ | 9,369 |
The effective interest rates for the 2022, 2026, and 2030 Exchangeable Notes are 1.6%, 1.2%, and 2.2%, respectively. Exchangeable Notes Hedges and Warrants In connection with the Exchangeable Notes offerings, the Company purchased call options allowing the Company to purchase initially (subject to adjustment upon the occurrence of specified events) the same number of shares that would be issuable upon the exchange of the applicable Exchangeable Notes at the prices per share set forth below (the “Exchangeable Notes Hedge”), and sold warrants allowing the counterparty to purchase (subject to adjustment upon the occurrence of specified events) shares at the per share prices set forth below (the “Exchangeable Notes Warrants”). The Exchangeable Notes Hedges are expected to reduce the potential dilutive effect on the Company’s common stock upon any exchange of Exchangeable Notes and/or offset any cash payment Match Group FinanceCo, Inc., Match Group FinanceCo 2, Inc. or Match Group FinanceCo 3, Inc. is required to make in excess of the principal amount of the exchanged notes. The Exchangeable Notes Warrants have a dilutive effect on the Company’s common stock to the extent that the market price per share of the Company common stock exceeds their respective strike prices. During the nine months ended September 30, 2022, in connection with the 2022 Exchangeable Notes presented for exchange during the current period, we exercised 0.9 million underlying shares of the related 2022 Exchangeable Notes Hedges, which were valued based on the volume weighted average price of Match Group common stock over a 40-day measurement period. During the nine months ended September 30, 2022, the Company received $61.5 million in cash for settlement of the Notes Hedges exercised in the current period or prior periods. During the nine months ended September 30, 2022, we paid $7.5 million to settle 0.4 million underlying shares of the 2022 Exchangeable Notes Warrants. The following tables present details of the Exchangeable Notes Hedges and Warrants outstanding at September 30, 2022:
| Number of Shares(a) |  | Approximate Equivalent Exchange Price per Share(a)
| (Shares in millions)
2022 Exchangeable Notes Hedge | 1.0 |  | $ | 43.99 |
2026 Exchangeable Notes Hedge | 6.6 |  | $ | 87.52 |
2030 Exchangeable Notes Hedge | 6.8 |  | $ | 84.22 |
| Number of Shares(a) |  | Weighted Average Strike Price per Share(a)
| (Shares in millions)
2022 Exchangeable Notes Warrants | 1.9 |  | $ | 68.22 |
2026 Exchangeable Notes Warrants | 6.6 |  | $ | 134.76 |
2030 Exchangeable Notes Warrants | 6.8 |  | $ | 134.82 |
______________________ (a)Subject to adjustment upon the occurrence of specified events.

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