The Company is in compliance in all material respects with all covenants under its financing arrangements as of June 30, 2021. The components of the Company’s consolidated borrowings were as follows (in thousands):


	June 30, 2021		December 31, 2020
Global senior secured revolving credit facility	$	330,318	$	481,007


Encore private placement notes	127,060		146,550
Senior secured notes	1,667,865		1,651,619
Convertible notes and exchangeable notes	422,500		583,500

Cabot securitisation senior facility	484,078		478,131
Other	22,992		24,398
Finance lease liabilities	8,951		8,288
	3,063,764		3,373,493
Less: debt discount and issuance costs, net of amortization	(64,468)		(91,859)
Total	$	2,999,296	$	3,281,634

Encore is the parent of the restricted group for the Global Senior Facility, the Senior Secured Notes and the Private Placement Notes, each of which is guaranteed by the same group of material Encore subsidiaries and secured by the same collateral, which represents substantially all of the assets of those subsidiaries.

In September 2020, the Company entered into a multi-currency senior secured revolving credit facility agreement (as amended and restated, the “Global Senior Facility”). In previous periods, the Company referred to this facility as the Cabot Credit Facility. As of June 30, 2021, the Global Senior Facility provided for a total committed facility of $1,050.0 million that matures in September 2024 and included the following key provisions:

The Global Senior Facility is secured by substantially all of the assets of the Company and the guarantors. Pursuant to the terms of an intercreditor agreement entered into with respect to the relative positions of (1) the Global Senior Facility, any super priority hedging liabilities and the Private Placement Notes (collectively, “Super Senior Liabilities”) and (2) the Senior Secured Notes, Super Senior Liabilities that are secured by assets that also secure the Senior Secured Notes will receive priority with respect to any proceeds received upon any enforcement action over any such assets.

As of June 30, 2021, the outstanding borrowings under the Global Senior Facility were $330.3 million. The weighted average interest rate of the Global Senior Facility was 3.25% for both the three and six months ended June 30, 2021. The weighted average interest rate of the previous Cabot Credit Facility was 3.15% and 3.36% for the three and six months ended June 30, 2020, respectively. The weighted average interest rate of the previous Encore revolving credit facility was 3.52% and 4.01% for the three and six months ended June 30, 2020, respectively. Available capacity under the Global Senior Facility was approximately $719.7 million as of June 30, 2021.

In August 2017, Encore entered into $325.0 million in senior secured notes with a group of insurance companies (the “Private Placement Notes”). As of June 30, 2021, $127.1 million of the Private Placement Notes remained outstanding. The Private Placement Notes bear an annual interest rate of 5.625%, mature in August 2024 and require quarterly principal payments of $9.8 million. The covenants and material terms for the Private Placement Notes are substantially similar to those for the Global Senior Facility.


	June 30, 2021		December 31, 2020		Maturity Date	Interest Payment Dates	Interest Rate
Cabot 2023 Notes	$	—	$	309,034	Oct 1, 2023	Apr 1, Oct 1	7.500	%

Encore 2025 Notes	415,046		426,752		Oct 15, 2025	Apr 15, Oct 15	4.875	%
Encore 2026 Notes	414,924		409,827		Feb 15, 2026	Feb 15, Aug 15	5.375	%
Encore 2028 Notes	345,770		—		Jun 1, 2028	Jun 1, Dec 1	4.250	%
Encore 2028 Floating Rate Notes	492,125		506,006		Jan 15, 2028	Jan 15, Apr 15, Jul 15, Oct 15	EURIBOR +4.250%(1)
	$	1,667,865	$	1,651,619

On June 1, 2021, Encore issued £250.0 million (approximately $345.8 million based on an exchange rate of $1.00 to £0.72, the exchange rate as of June 30, 2021) aggregate principal amount of senior secured notes due 2028 (the “Encore 2028 Notes”). The Encore 2028 Notes accrue interest at a rate of 4.250% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, commencing on December 1, 2021. The Encore 2028 Notes will mature on June 1, 2028, unless earlier repurchased or redeemed by the Company. Encore used the proceeds from the offering to redeem in full the then outstanding £226.2 million (approximately $312.9 million based on an exchange rate of $1.00 to £0.72, the exchange rate as of June 30, 2021) aggregate principal amount of 7.500% senior secured notes due 2023 (the “Cabot 2023 Notes”) at a redemption price of 101.875%, and to pay certain transaction fees and expenses incurred in connection with the offering. The Company recognized a loss on extinguishment of debt of approximately $9.3 million associated with this transaction during the three months ended June 30, 2021.

The Senior Secured Notes are secured by the same collateral as the Global Senior Facility and the Private Placement Notes. The guarantees provided in respect of the Senior Secured Notes are pari passu with each such guarantee given in respect of the Global Senior Facility and Private Placement Notes. Subject to the intercreditor agreement described above under “Global Senior Secured Revolving Credit Facility,” Super Senior Liabilities that are secured by assets that also secure the Senior Secured Notes will receive priority with respect to any proceeds received upon any enforcement action over any such assets.

The following table provides a summary of the principal balance, maturity date and interest rate for the Company’s convertible and exchangeable senior notes (the “Convertible Notes” or “Exchangeable Notes,” as applicable) ($ in thousands):


	June 30, 2021		December 31, 2020		Maturity Date	Interest Payment Dates	Interest Rate
2021 Convertible Notes(1)	$	—	$	161,000	Mar 15, 2021	Mar 15, Sep 15	2.875	%
2022 Convertible Notes	150,000		150,000		Mar 15, 2022	Mar 15, Sep 15	3.250	%
2023 Exchangeable Notes	172,500		172,500		Sep 1, 2023	Mar 1, Sep 1	4.500	%
2025 Convertible Notes	100,000		100,000		Oct 1, 2025	Apr 1, Oct 1	3.250	%
	$	422,500	$	583,500

The Exchangeable Notes were issued by Encore Capital Europe Finance Limited (“Encore Finance”), a 100% owned finance subsidiary of Encore, and are fully and unconditionally guaranteed by Encore. Unless otherwise indicated in connection with a particular offering of debt securities, Encore will fully and unconditionally guarantee any debt securities issued by Encore Finance. Amounts related to Encore Finance are included in the consolidated financial statements of Encore subsequent to April 30, 2018, the date of the incorporation of Encore Finance.

Prior to the close of business on the business day immediately preceding their respective free conversion or exchange date (listed below), holders may convert or exchange their Convertible Notes or Exchangeable Notes under certain circumstances set forth in the applicable indentures. On or after their respective free conversion or exchange dates until the close of business on the second scheduled trading day immediately preceding their respective maturity date, holders may convert or exchange their notes at any time. Certain key terms related to the convertible and exchangeable features as of June 30, 2021 are listed below:


	2022 Convertible Notes			2023 Exchangeable Notes			2025 Convertible Notes
Initial conversion or exchange price	$	45.57		$	44.62		$	40.00
Closing stock price at date of issuance	$	35.05		$	36.45		$	32.00
Closing stock price date	Feb 27, 2017			Jul 20, 2018			Sep 4, 2019
Conversion or exchange rate (shares per $1,000 principal amount)	21.9467			22.4090			25.0000
Free conversion or exchange date	Sep 15, 2021			Mar 1, 2023			Jul 1, 2025
Stated interest rate	3.250		%	4.500		%	3.250		%

In the event of conversion or exchange, the notes are convertible or exchangeable into cash up to the aggregate principal amount of the notes and the excess conversion premium, if any, may be settled in cash or shares of the Company’s common stock at the Company’s election and subject to certain restrictions contained in each of the indentures governing the Convertible Notes and Exchangeable Notes.

As discussed in “Note 1: Ownership, Description of Business, and Summary of Significant Accounting Policies,” the Company adopted ASU 2020-06 on January 1, 2021 using a modified-retrospective approach. The Company’s convertible and exchangeable notes are no longer bifurcated to a debt component and an equity component, instead, they are carried as a single liability, which reflects the principal amount of the convertible and exchangeable notes. The interest expense recognized on the convertible and exchangeable notes is based on coupon rates, rather than higher effective interest rates. The Company has not adjusted prior period comparative information and will continue to disclose prior period financial information in accordance with the previous accounting guidance.


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Interest expense—stated coupon rate	$	3,972	$	5,799	$	8,895	$	11,598
Interest expense—amortization of debt discount	—		3,095		—		6,139
Interest expense—Convertible Notes and Exchangeable Notes	$	3,972	$	8,894	$	8,895	$	17,737

In order to reduce the risk related to the potential dilution and/or the potential cash payments the Company may be required to make in the event that the market price of the Company’s common stock becomes greater than the exchange price of the 2023 Exchangeable Notes, the Company maintains a hedge program that increases the effective exchange price for the 2023 Exchangeable Notes. The Company did not hedge the 2022 Convertible Notes or the 2025 Convertible Notes.

The details of the hedge program are listed below (in thousands, except conversion or exchange price):


	2023 Exchangeable Notes
Cost of the hedge transaction(s)	$	17,785
Initial exchange price	$	44.62
Effective exchange price	$	62.48

Cabot Securitisation UK Ltd (“Cabot Securitisation”), an indirect subsidiary of Encore, has a senior facility for a committed amount of £350.0 million (as amended, the “Cabot Securitisation Senior Facility”). The Cabot Securitisation Senior Facility matures in March 2025. Funds drawn under the Cabot Securitisation Senior Facility bear interest at a rate per annum equal to SONIA plus a margin of 3.06% plus, for periods after March 15, 2023, a step-up margin ranging from zero to 1.00%.

As of June 30, 2021, the outstanding borrowings under the Cabot Securitisation Senior Facility were £350.0 million (approximately $484.1 million based on an exchange rate of $1.00 to £0.72, the exchange rate as of June 30, 2021). The obligations of Cabot Securitisation under the Cabot Securitisation Senior Facility are secured by first ranking security interests over all of Cabot Securitisation’s property, assets and rights (including receivables purchased from Cabot Financial UK from time to time), the book value of which was approximately £366.1 million (approximately $506.3 million based on an exchange rate of $1.00 to £0.72, the exchange rate as of June 30, 2021) as of June 30, 2021. The weighted average interest rate was 3.11% for the three and six months ended June 30, 2021 and 3.14% and 3.33% for the three and six months ended June 30, 2020, respectively.