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Debt | 12 Months Ended
--- | ---
Dec. 31, 2025
Debt Disclosure [Abstract] |
Debt | DEBT The Company’s debt is comprised of the following (in thousands):
|  |  |  |  |  |  |  | Interest Payable |  | Balance as of December 31,
Debt Description |  | Issued |  | Maturity |  | Interest Rate(1) |  |  | 2025 |  | 2024
First Lien Term Loan B due 2030 |  | 10/13/2023 |  | 10/13/2030 |  | Term SOFR +2.00% |  | Quarterly |  | $ | 1,764,249 |  |  | $ | 1,984,090 |
First Lien Term Loan B-2 due 2032 |  | 3/7/2025 |  | 3/7/2032 |  | Term SOFR +1.75% |  | Quarterly |  | 1,441,989 |  |  | — |
First Lien Revolving Credit Facility |  | 3/16/2018 |  | 10/1/2029 |  | Term SOFR +2.00% |  | Quarterly |  | — |  |  | — |
First Lien Term Loan A due 2030 |  | 10/28/2025 |  | 10/28/2030 |  | Term SOFR +1.50% |  | Quarterly |  | 325,000 |  |  | — |
First Lien Notes due 2026 |  | 4/4/2019 |  | 4/15/2026 |  | 5.750% |  | 3/15 and 9/15 |  | 75,000 |  |  | 1,350,000 |
First Lien Notes due 2027 |  | 8/20/2020 |  | 8/31/2027 |  | 3.375% |  | 6/15 and 12/15 |  | 1,000,000 |  |  | 1,000,000 |
First Lien Notes due 2029 |  | 7/29/2021 |  | 8/1/2029 |  | 4.125% |  | 2/1 and 8/1 |  | 1,000,000 |  |  | 1,000,000 |
First Lien Notes due 2033 |  | 10/15/2025 |  | 10/15/2033 |  | 5.875% |  | 1/15 and 7/15 |  | 1,000,000 |  |  | — |
Second Lien Notes due 2028 |  | 1/28/2020 |  | 1/15/2028 |  | 6.250% |  | 1/15 and 7/15 |  | — |  |  | 1,300,000 |
ADT Notes due 2032 |  | 5/2/2016 |  | 7/15/2032 |  | 4.875% |  | 1/15 and 7/15 |  | 728,016 |  |  | 728,016 |
ADT Notes due 2042 |  | 7/5/2012 |  | 7/15/2042 |  | 4.875% |  | 1/15 and 7/15 |  | 21,896 |  |  | 21,896 |
2020 Receivables Facility(2) |  | 3/5/2020 |  | 11/20/2030 |  | Various |  | Monthly |  | 443,058 |  |  | 407,901 |
Total debt principal, excluding finance leases |  | 7,799,208 |  |  | 7,791,903 |
Plus: Finance lease obligations(3) |  | 47,765 |  |  | 69,442 |
Unamortized debt discount, net |  | (30,579) |  |  | (12,081) |
Unamortized deferred financing costs |  | (22,949) |  |  | (26,990) |
Unamortized purchase accounting fair value adjustment and other |  | (103,811) |  |  | (115,201) |
Total debt |  | 7,689,634 |  |  | 7,707,073 |
Less: Current maturities of long-term debt, net of unamortized debt discount |  | (310,204) |  |  | (195,791) |
Long-term debt |  | $ | 7,379,430 |  |  | $ | 7,511,282 |
__________________ (1)Interest rate as of December 31, 2025. I nterest on the 2020 Receivables Facility is primarily based on the Secured Overnight Financing Rate (“SOFR”) +0.95% and Cost of Funds (“COF”) +0.85%. (2)Maturity date for the 2020 Receivables Facility represents the final maturity of date of current loans borrowed under the facility. (3)Refer to Note 14 “Leases” for additional information regarding the Company’s finance leases. First Lien Credit Agreement The Company’s first lien credit agreement dated as of July 1, 2015 (together with subsequent amendments and restatements, the “First Lien Credit Agreement”) provides for term loans (the “First Lien Term Loan B due 2030” and the “First Lien Term Loan B-2 due 2032,” together, the “First Lien Term Loan Bs”) and a revolving credit facility (the “First Lien Revolving Credit Facility”). Prime Security Services Holdings, LLC (“Holdings”), a Delaware limited liability company and a wholly owned indirect subsidiary of the Company, Prime Security Services Borrower, LLC (“Prime Borrower”), a Delaware limited liability company and a wholly owned direct subsidiary of Holdings, and The ADT Corporation, a Delaware corporation and a wholly owned direct subsidiary of Prime Borrower (together with Prime Borrower, the “Borrowers”), are parties to the First Lien Credit Agreement as holdings and borrowers respectively. Indebtedness incurred under the First Lien Credit Agreement is guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of Prime Borrower’s wholly owned material domestic subsidiaries, and by Prime Borrower’s direct parent on a limited recourse basis, and is secured by a pledge of Prime Borrower’s capital stock directly held by its direct parent and by first-priority security interests in substantially all of the assets of Prime Borrower and the subsidiary guarantors, in each case, subject to certain permitted liens and exceptions. The First Lien Term Loan B due 2030 The First Lien Term Loan B due 2030 requires scheduled quarterly amortization payments equal to 0.25% of its outstanding principal amount at the time of the December 2024 amendment (discussed below), with the remaining balance payable at maturity. The Borrowers may make voluntary prepayments on the First Lien Term Loan B due 2030 at any time prior to maturity at par, subject to a 1.00% prepayment premium in the event of certain specified refinancing events at any time before June 2025. Additionally, based on certain specified net first lien leverage ratios, the Borrowers may be required to make annual prepayments on the outstanding First Lien Term Loan B due 2030 with a percentage of the Company’s excess cash flow, as defined in the First Lien Credit Agreement, if the excess cash flow exceeds a certain specified threshold, which is 0% if our net first lien leverage ratio is less than or equal to 2.20 to 1.00. As of December 31, 2025, the Borrowers were not required to make an annual prepayment based on the Company’s excess cash flow. The First Lien Term Loan B due 2030 bears interest at a rate equal to, at the Prime Borrower’s option, either (a) a term SOFR rate (“Term SOFR”) with a floor of zero or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50% per annum, (ii) the rate of interest per annum last quoted by The Wall Street Journal as the “Prime Rate” in the United States and (iii) the one-month adjusted term SOFR plus 1.00% per annum (“Base Rate”), in each case, plus an applicable margin of 2.00% per annum for Term SOFR loans and 1.00% per annum for Base Rate loans. Prime Borrower has elected the Term SOFR alternative to apply to borrowings of the First Lien Term Loan B due 2030. The First Lien Term Loan B-2 due 2032 The First Lien Term Loan B-2 due 2032 requires scheduled quarterly amortization payments equal to 0.25% of its original principal amount with the remaining balance payable at maturity. The Borrowers may make voluntary prepayments on the First Lien Term Loan B-2 due 2032 at any time prior to maturity at par, subject to a 1.00% prepayment premium in the event of certain specified refinancing events during the first six months after the most recent amendment. The First Lien Term Loan B-2 due 2032 bears interest at a rate equal to, at the Prime Borrower’s option, either (a) a term SOFR rate with a floor of zero or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50% per annum, (ii) the rate of interest per annum last quoted by The Wall Street Journal as the “Prime Rate” in the United States and (iii) the Base Rate, in each case, plus an applicable margin of 1.75% per annum for Term SOFR loans and 0.75% per annum for Base Rate loans. Prime Borrower has elected the Term SOFR alternative to apply to borrowings of the First Lien Term Loan B-2 due 2032. The First Lien Term Loan B-2 due 2032 is subject to a springing maturity of 91 days prior to the maturity date of certain long-term indebtedness of Prime Security Services Borrower, LLC and its subsidiaries if, on such date, the aggregate principal amount of such indebtedness equals or exceeds $1 billion. Loans under the First Lien Term Loan B-2 due 2032 are treated as a separate class from the existing loans under the First Lien Term Loan B due 2030. First Lien Revolving Credit Facility The applicable margin for borrowings under the First Lien Revolving Credit Facility is 2.00% for Term SOFR loans (subject to a credit spread adjustment) and 1.00% for Base Rate loans, in each case, subject to adjustment pursuant to a leverage-based pricing grid, subject to two step downs to 1.75% and 1.50% based on a net first lien leverage ratio of 2.00 to 1.00 and 1.50 to 1.00, respectively. In addition, the Borrowers are required to pay a commitment fee of 0.20% to 0.30%, with step downs to 0.25% and 0.20% based on a net first lien leverage ratio of 2.00 to 1.00 and 1.50 to 1.00, respectively, with respect to the unused commitments under the First Lien Revolving Credit Facility. The First Lien Revolving Credit Facility is also subject to a springing maturity of 91 days prior to the maturity date of certain long-term indebtedness if, as of such date, the outstanding principal amount of such indebtedness exceeds $350 million. The aggregate amount of commitments under the First Lien Revolving Credit Facility is $800 million. As of December 31, 2025, the Company had $800 million in available borrowing capacity under the First Lien Revolving Credit Facility. Significant Activity Significant amendments and restatements related to the First Lien Credit Agreement during the periods presented were as follows: •October 2023 - The Company redeemed approximately $1.3 billion of the then outstanding term loan due 2026 (the “First Lien Term Loan B due 2026”) using net proceeds from the Commercial Divestiture. •October 2023 - The Company amended and restated the First Lien Credit Agreement and refinanced the remaining outstanding balance of the First Lien Term Loan B due 2026 with a new $1.375 billion 7-year First Lien Term Loan B due 2030. •April 2024 - The Company amended and restated the First Lien Credit Agreement, which reduced the interest rate on the First Lien Term Loan B due 2030 from Term SOFR +2.50% to Term SOFR +2.25%. •May 2024 - The Company amended and restated the First Lien Credit Agreement, which included the exchange of $143 million principal amount of loans under the Company’s then outstanding Term Loan A Facility due 2028 for its First Lien Term Loan B due 2030. In addition, later that month, the Company further amended and restated the First Lien Credit Agreement, pursuant to which the Company incurred an additional $474 million of outstanding principal under the First Lien Term Loan B due 2030 with the proceeds used to pay off the remaining outstanding balance of the Company’s then outstanding Term Loan A Facility due 2028. •October 2024 - The Company amended and restated the First Lien Credit Agreement to extend the maturity date of the First Lien Revolving Credit Facility to October 2029 and obtain an additional $225 million of First Lien Revolving Credit Facility commitments. After giving effect to the amendment, the aggregate amount of commitments under the First Lien Revolving Credit Facility is $800 million. In addition, the amendment reduced the commitment fee in respect of the First Lien Revolving Credit Facility to 0.30% per annum in respect of the unutilized commitments thereunder, subject to two step-downs based on certain specified net first lien leverage ratios. •December 2024 - The Company amended and restated the First Lien Credit Agreement, which reduced the interest rate on the First Lien Term Loan B due 2030 from Term SOFR +2.25% to Term SOFR +2.00%. •March 2025 - The Company amended and restated the First Lien Credit Agreement, which provided for the issuance of a new $600 million First Lien Term Loan B-2 due 2032, and received net proceeds of $597 million. The Company used the net proceeds to redeem $500 million of the First Lien Notes due 2026. •July 2025 - The Company amended and restated the First Lien Credit Agreement, which provided for the issuance of $550 million of incremental borrowings under the First Lien Term Loan B-2 due 2032, and received net proceeds of $545 million. These incremental borrowings have the same terms as existing loans under the First Lien Term Loan B-2 due 2032. The Company used the net proceeds and cash on hand to redeem $550 million of the First Lien Notes due 2026. •October 2025 - The Company amended and restated the First Lien Credit Agreement, which provided for the issuance of $300 million of incremental borrowings under the First Lien Term Loan B-2 due 2032, and received net proceeds of $297 million. The Company used the net proceeds to partially redeem the Second Lien Notes due 2028. •October 2025 - The Company redeemed $200 million of the First Lien Term Loan B due 2030 using proceeds from the First Lien Term Loan A due 2030. During 2024 and 2023, proceeds and repayments of long-term borrowings on the Consolidated Statements of Cash Flows include the impact of $704 million and $230 million, respectively, from certain of the amendments described above. Significant borrowings and repayments under the First Lien Revolving Credit Facility during the periods presented were as follows: •2023: There were no borrowings or repayments. •2024: The Company borrowed $365 million and repaid $365 million. •2025: The Company borrowed $198 million and repaid $198 million. First Lien Term Loan A due 2030 On October 28, 2025, the Company entered into a term loan credit agreement (together with subsequent amendments and restatements, the “Term Loan Credit Agreement”) for an aggregate principal amount of $325 million of term loans under a senior secured term loan A facility (the “First Lien Term Loan A due 2030”). The Company used the proceeds for general corporate purposes and to redeem $200 million of the First Lien Term Loan B due 2030. The First Lien Term Loan A due 2030 requires scheduled amortization payments, commencing on March 31, 2026, in annual amounts equal to (a) prior to March 31, 2028, 2.5% of its original principal amount and (b) on or after March 31, 2028, 5.0% of its original principal amount, payable quarterly, with the balance payable at maturity. The Company may make voluntary prepayments of the First Lien Term Loan A due 2030 at any time prior to maturity at par. The First Lien Term Loan A due 2030 bears interest at a rate equal to, at the Prime Borrower’s option, either (a) a Term SOFR rate with a floor of zero or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50% per annum, (ii) the rate of interest per annum last quoted by The Wall Street Journal as the “Prime Rate” in the United States and (iii) the one-month adjusted term SOFR plus 1.00% per annum, in each case, plus an applicable margin of 1.50% per annum for Term SOFR loans and 0.50% per annum for Base Rate loans, subject to adjustments based on certain specified net first lien leverage ratios. The Company has elected the Term SOFR alternative to apply to borrowings of the First Lien Term Loan A due 2030. Indebtedness incurred under the Term Loan Credit Agreement is guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of the Prime Borrower’s wholly owned material domestic subsidiaries, and by Prime Borrower’s direct parent on a limited recourse basis, and is secured by a pledge of Prime Borrower’s capital stock directly held by its direct parent and by first-priority security interests in substantially all of the assets of Prime Borrower and the subsidiary guarantors, in each case subject to certain permitted liens and exceptions. Additionally, the Term Loan Credit Agreement includes customary mandatory prepayment provisions, covenants and restrictions, including a financial maintenance covenant requiring the Borrowers to comply as of the last day of each fiscal quarter, beginning with the fiscal quarter ending March 31, 2026, with a specified maximum consolidated net first lien leverage ratio. First Lien Notes due 2024 As of December 31, 2025, the Company fully redeemed the 5.250% first-priority senior secured notes due 2024 (the “First Lien Notes due 2024”) as a result of the following transactions: •May 2023 - The Company redeemed $150 million principal amount of the outstanding First Lien Notes due 2024 for a redemption price of $150 million, excluding accrued and unpaid interest, using cash on hand. •December 2023 - The Company redeemed $500 million principal amount of the outstanding First Lien Notes due 2024 for a redemption price of $500 million, excluding accrued and unpaid interest, using remaining net proceeds from the Commercial Divestiture and cash on hand. •April 2024 - The Company redeemed the remaining outstanding principal balance of $100 million of the First Lien Notes due 2024 for a redemption price of $100 million, excluding accrued and unpaid interest, using proceeds from the Company’s First Lien Revolving Credit Facility. First Lien Notes due 2026 The Company’s 5.750% first-priority senior secured notes due 2026 (the “First Lien Notes due 2026”) are due at maturity, and may be redeemed, in whole or in part, at any time at a make-whole premium plus accrued and unpaid interest to, but excluding, the redemption date. The First Lien Notes due 2026 are guaranteed, jointly and severally, on a senior secured first-priority basis, by each of the Company’s existing and future direct or indirect wholly-owned material domestic subsidiaries that guarantee the First Lien Credit Agreement. Upon the occurrence of specified change of control events, the Company must offer to repurchase the First Lien Notes due 2026 at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The indenture governing the First Lien Notes due 2026 also provides for customary events of default. As discussed above, partial redemptions of the First Lien Notes due 2026 were as follows: •March 2025 - The Company redeemed $500 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $506 million, which includes a make-whole payment, using proceeds from the Company’s March 2025 issuance of the First Lien Term Loan B-2 due 2032. •July 2025 - The Company redeemed $550 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $554 million, which includes a make-whole payment, using proceeds from the Company’s July 2025 issuance of the First Lien Term Loan B-2 due 2032 and cash on hand. •December 2025 - The Company redeemed $225 million of the First Lien Notes due 2026, excluding accrued and unpaid interest, for a total redemption price of $226 million, which includes a make-whole payment, using cash on hand. First Lien Notes due 2027 T he Company’s 3.375% first-priority senior secured notes due 2027 (the “First Lien Notes due 2027”) are due at maturity and may be redeemed at the Company’s option as follows: •Prior to August 31, 2026, in whole at any time or in part from time to time, at a make-whole premium plus accrued and unpaid interest, if any, thereon to the redemption date. •On or after August 31, 2026, in whole at any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the First Lien Notes due 2027 redeemed plus accrued and unpaid interest, if any, thereon to the redemption date. The Company’s obligations relating to the First Lien Notes due 2027 are guaranteed, jointly and severally, on a senior secured first-priority basis, by each of the Company’s domestic subsidiaries that guarantees its First Lien Credit Agreement and by each of the Company’s future domestic subsidiaries that guarantees certain of the Company’s debt. The First Lien Notes due 2027 and the related guarantees are secured by first-priority security interests in substantially all of the tangible and intangible assets owned by the issuers and each guarantor, subject to certain permitted liens and exceptions. Upon the occurrence of specified change of control events, the Company must offer to repurchase the notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The indenture governing the First Lien Notes due 2027 also provides for customary events of default. First Lien Notes due 2029 In July 2021, the Company issued $1.0 billion aggregate principal amount of 4.125% first-priority senior secured notes due 2029 (the “First Lien Notes due 2029”). The First Lien Notes due 2029 will mature on August 1, 2029, with semi-annual interest payment dates of February 1 and August 1 of each year, beginning February 1, 2022, and may be redeemed at the Company’s option as follows: •Prior to August 1, 2028, in whole at any time or in part from time to time, at a redemption price equal to the greater of (i) 100% of the principal amount of the First Lien Notes due 2029 to be redeemed and (ii) the sum of the present values of the aggregate principal amount of the First Lien Notes due 2029 to be redeemed and the remaining scheduled interest payments due on any date after the redemption date, to and including August 1, 2028, discounted at an adjusted treasury rate plus 50 basis points, plus, in either case accrued and unpaid interest as of, but excluding, the redemption date. •On or after August 1, 2028, in whole at any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the First Lien Notes due 2029 to be redeemed and accrued and unpaid interest as of, but excluding, the redemption date. The Company’s obligations relating to the First Lien Notes due 2029 are guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of the Company’s subsidiaries and are secured by first-priority security interests in substantially all of the assets of the Company’s domestic subsidiaries, subject to certain permitted liens and exceptions. Upon the occurrence of specified change of control events, the Company may be required to purchase the notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The indenture governing the First Lien Notes due 2029 also provides for customary events of default. First Lien Notes due 2033 In October 2025, the Company issued $1.0 billion aggregate principal amount of 5.875% first-priority senior secured notes due 2033 (the “First Lien Notes due 2033”). The First Lien Notes due 2033 will mature on October 15, 2033, with semi-annual interest payment dates of January 15 and July 15 of each year, beginning January 15, 2026, and may be redeemed at the Company’s option as follows: •Prior to October 15, 2032, in whole at any time or in part from time to time, at a redemption price equal to the greater of (i) 100% of the principal amount of the First Lien Notes due 2033 to be redeemed and (ii) the sum of the present values of the aggregate principal amount of the First Lien Notes due 2033 to be redeemed and the remaining scheduled interest payments due on any date after the redemption date, to and including October 15, 2032, discounted at an adjusted treasury rate plus 50 basis points, plus, in either case accrued and unpaid interest as of, but excluding, the redemption date. •On or after October 15, 2032, in whole at any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the First Lien Notes due 2033 to be redeemed and accrued and unpaid interest as of, but excluding, the redemption date. The Company’s obligations relating to the First Lien Notes due 2033 are guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of the Company’s subsidiaries and are secured by first-priority security interests in substantially all of the assets of the Company’s domestic subsidiaries, subject to certain permitted liens and exceptions. Upon the occurrence of specified change of control events, the Company may be required to purchase the notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The indenture governing the First Lien Notes due 2033 also provides for customary events of default. Second Lien Notes due 2028 In October 2025, the Company redeemed its 6.250% second-priority senior secured notes due 2028 (the “Second Lien Notes due 2028”) at par using proceeds from the First Lien Notes due 2033, incremental borrowings under the First Lien Term Loan B-2 due 2032, and cash on hand. ADT Notes In connection with the ADT Acquisition, the Company entered into supplemental indentures to notes originally issued by The ADT Corporation (collectively, the “ADT Notes”) providing for each series of ADT Notes to benefit from (i) guarantees by substantially all of the Company’s domestic subsidiaries and (ii) first-priority senior security interests, subject to permitted liens, in substantially all of the existing and future assets of the Company’s domestic subsidiaries. As a result, these notes remained outstanding and became obligations of the Company. The outstanding ADT Notes are due at maturity, and may be redeemed, in whole at any time or in part from time to time, at a redemption price equal to the principal amount of the notes to be redeemed, plus a make-whole premium, plus accrued and unpaid interest as of, but excluding, the redemption date. Additionally, upon the occurrence of specified change of control events, the Company must offer to repurchase the ADT Notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The indentures governing the ADT Notes also provide for customary events of default. 2020 Receivables Facility During March 2020, the Company entered into the 2020 Receivables Facility, as amended, whereby the Company obtains financing by selling or contributing certain retail installment contract receivables to the Company’s wholly-owned consolidated bankruptcy-remote special purpose entity (“SPE”). The SPE grants a security interest in those retail installment contract receivables as collateral for cash borrowings under the 2020 Receivables Facility. The SPE borrower under the 2020 Receivables Facility is a separate legal entity with its own creditors who will be entitled, prior to and upon the liquidation of the SPE, to be satisfied out of the SPE’s assets prior to any assets of the SPE becoming available to the Company (other than the SPE). Accordingly, the assets of the SPE are not available to pay creditors of the Company (other than the SPE), although collections from the transferred retail installment contract receivables in excess of amounts required to repay amounts then due and payable to the SPE’s creditors may be released to the Company and subsequently used by the Company (including to pay other creditors). The SPE’s creditors under the 2020 Receivables Facility have legal recourse to the transferred retail installment contract receivables owned by the SPE, and to the Company for certain performance and operational obligations relating to the 2020 Receivables Facility, but do not have any recourse to the Company (other than the SPE) for the payment of principal and interest on the advances under the 2020 Receivables Facility. Significant amendments to the 2020 Receivables Facility during the periods presented were as follows: •March 2023 - The borrowing capacity was increased from $400 million to $500 million and the uncommitted revolving period was extended from May 2023 to March 2024, among other things. •March 2024 - The uncommitted revolving period was extended from March 2024 to April 2024. •April 2024 - The borrowing capacity was increased from $500 million to $550 million and the uncommitted revolving period was extended from April 2024 to April 2025, among other things. In addition, proceeds and repayments from the receivables facility during 2024 include the impact of $32 million from these amendments. •March 2025 - The uncommitted revolving period was extended to March 2026, the interest rate on outstanding borrowings was reduced, and the advance rate on pledged collateral was increased. The Company services the transferred retail installment contract receivables and is responsible for ensuring the related collections are remitted to a segregated bank account in the SPE’s name. On a monthly basis, the segregated account is utilized to make required principal, interest, and other payments due under the 2020 Receivables Facility. The segregated account is considered restricted cash. Proceeds and repayments from the 2020 Receivables Facility are presented in cash flows from financing activities on the Consolidated Statements of Cash Flows. The impact to the Consolidated Statements of Operations from the 2020 Receivables Facility was primarily due to the allowance for credit losses and interest expense during the periods presented. As of December 31, 2025, the Company had an uncommitted available borrowing capacity under the 2020 Receivables Facility of $107 million. Variable Interest Entity The SPE, as described above, meets the definition of a variable interest entity (“VIE”) for which the Company is the primary beneficiary as it has the power to direct the SPE’s activities and the obligation to absorb losses or the right to receive benefits of the SPE. As such, the SPE’s assets, liabilities, and financial results of operations are consolidated in the Company’s consolidated financial statements. As of December 31, 2025 and 2024, the SPE’s assets and liabilities primarily consisted of a portion of the Company’s unbilled retail installment contract receivables, net, of $593 million and $575 million, respectively, and borrowings under the 2020 Receivables Facility as presented above. Debt Covenants The Company’s credit agreements and indentures associated with the borrowings above contain certain covenants and restrictions that limit the Company’s ability to, among other things: (a) incur additional debt or issue certain preferred equity interests; (b) create liens on certain assets; (c) make certain loans or investments (including acquisitions); (d) pay dividends on or make distributions in respect of the capital stock or make other restricted payments; (e) consolidate, merge, sell, or otherwise dispose of all or substantially all of the Company’s assets; (f) sell assets; (g) enter into certain transactions with affiliates; (h) enter into sale-leaseback transactions; (i) restrict dividends from the Company’s subsidiaries or restrict liens; (j) change the Company’s fiscal year; and (k) modify the terms of certain debt or organizational agreements. The Company’s credit agreements and indentures associated with the borrowings above also provide for customary events of default. The Company is subject to a springing financial maintenance covenant under the First Lien Credit Agreement, which requires the Company to not exceed a specified first lien leverage ratio at the end of each fiscal quarter if the testing conditions are satisfied. The covenant is tested if the outstanding loans under the First Lien Revolving Credit Facility, subject to certain exceptions, exceed 30% of the total commitments under the First Lien Revolving Credit Facility as of the last day of any fiscal quarter. As of December 31, 2025, the Company was in compliance with all financial covenant and other maintenance tests for all debt obligations. Loss on Extinguishment of Debt Loss on extinguishment of debt includes the payment of call and redemption premiums, the write-off of unamortized deferred financing costs and discounts, and certain other expenses associated with extinguishment of debt. Loss on extinguishment of debt was $19 million, $5 million, and $17 million during 2025, 2024, and 2023, respectively. Additional fees and other costs associated with financing transactions were not material during the periods presented. Other As of December 31, 2025, the aggregate annual maturities of debt, excluding finance leases, were as follows:
(in thousands) | 2026 |  | 2027 |  | 2028 |  | 2029 |  | 2030 |  | Thereafter |  | Total
Debt principal | $ | 287,530 |  |  | $ | 1,179,896 |  |  | $ | 132,050 |  |  | $ | 1,093,356 |  |  | $ | 1,987,196 |  |  | $ | 3,119,180 |  |  | $ | 7,799,208 |
Interest expense (excluding interest income) during 2025, 2024, and 2023 on the Company’s debt, including finance leases and interest rate swap contracts presented within interest expense, net, was $470 million, $451 million, and $586 million, respectively.

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- 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://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 8A -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-8A Reference 2: http://www.xbrl.org/2003/role/disclosureRef 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