Convertible Securities

In 2013, the Company settled $460.0 million principal amount outstanding of our 3.95% senior convertible notes due 2038 (“2008 senior convertible notes”). In connection with the settlement, the Company paid an aggregate of $641.3 million and all of our 2008 senior convertible notes have been retired.

At December 31, 2013, the Company has two junior convertible trust preferred securities outstanding, one issued in 2006 (the "2006 junior convertible trust preferred securities") and a second issued in 2007 (the "2007 junior convertible trust preferred securities").

The carrying values of the Company's convertible securities are as follows:



	December 31, 2012				December 31, 2013
	Carrying Value		Principal amount at maturity		Carrying Value		Principal amount at maturity
Senior convertible securities:
2008 senior convertible notes⁽¹⁾	$	450.1	$	460.0	$	—	$	—
Junior convertible trust preferred securities:
2007 junior convertible trust preferred securities⁽¹⁾	$	299.4	$	430.8	$	301.2	$	430.8
2006 junior convertible trust preferred securities⁽¹⁾	216.1		300.0		217.5		300.0
Total junior convertible securities	$	515.5	$	730.8	$	518.7	$	730.8

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(1)	Carrying value is accreted to the principal amount at maturity over an expected life of 30 years for each of the junior convertible trust preferred securities.

The principal terms of these securities are summarized below.



	2006 Junior Convertible Trust Preferred Securities⁽¹⁾			2007 Junior Convertible Trust Preferred Securities⁽²⁾
Issue date	April 2006			October 2007
Maturity date	April 2036			October 2037
Par value (in millions)	$	300.0		$	430.8
Carrying value (in millions)⁽³⁾	$	217.5		$	301.2
Denomination	$	50		$	50
Current conversion rate	0.333			0.250
Current conversion price	$	150.00		$	200.00
Stated coupon	5.10		%	5.15		%
Coupon frequency	Quarterly			Quarterly
Tax deduction rate⁽⁴⁾	7.50		%	8.00		%

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(1)	On February 13, 2014, we delivered a notice to redeem all of our outstanding 2006 convertible trust preferred securities. In lieu of redemption, holders of the 2006 junior convertible trust preferred securities may elect to convert their securities into a defined number of shares. Upon conversion, holders will receive cash or shares of our common stock, or a combination thereof, at our election.


(2)	The Company may redeem the 2007 junior convertible trust preferred securities if the closing price of the Company's common stock exceeds $260 per share for 20 trading days in a period of 30 consecutive trading days.


(3)	The carrying value is accreted to the principal amount at maturity over an expected life of 30 years for each of the junior convertible trust preferred securities.

(4)

These convertible securities are considered contingent payment debt instruments under federal income tax regulations, which require the Company to deduct interest in an amount greater than its reported Interest expense. These deductions result in annual deferred tax liabilities of approximately $12.9 million ($8.1 million assuming the redemption of the 2006 convertible trust preferred securities). These deferred tax liabilities will be reclassified directly to stockholders' equity if the Company's common stock is trading above certain thresholds at the time of the conversion of the securities. In 2013 , $50.6 million was reclassified to stockholders' equity related to the repurchase of the 2008 senior convertible notes.