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LONG TERM DEBT | 12 Months Ended
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Dec. 31, 2017
Debt Disclosure [Abstract] |
LONG TERM DEBT |
NOTE 14:- | LONG TERM DEBT
In connection with financing the acquisition of inContact (refer to Note 1b) which closed on November 14, 2016, the Company entered into a Credit Agreement with certain lenders, according to which the following credit facilities were issued: 1) a long term loan of $475,000, and 2) a revolving credit loan of up to $75,000. The Credit Agreement contains a number of covenants and restrictions that among other things, and subject to certain agreed upon exceptions, require the Company and its subsidiaries to satisfy certain financial covenants and restricts the ability of the Company and its subsidiaries to incur liens, incur additional indebtedness, make loans and investments, engage in mergers and acquisitions, engage in asset sales, declare dividends or redeem or repurchase capital stock, prepay, redeem or purchase subordinated debt and amend or otherwise alter debt agreements, in each case, subject to certain agreed upon exceptions. A failure to comply with these covenants could permit the lenders under the Credit Agreement to declare all amounts borrowed under the Credit Agreement, together with accrued interest and fees, to be immediately due and payable. As of December 31, 2017, the Company was in compliance with all covenants and requirements outlined in the Credit Agreement. Long term loan In January 2017, the Company prepaid a principal amount of $260,000 of the amount outstanding under the long term loan. As a result, the remaining principal of $215,000 are due on the final maturity date of the term loan facility. As of December 31, 2017, the contractual principal payments for the long term loan are $215,000 which are due at December 31, 2021. The long term loan bears interest through maturity at a variable rate based upon, at the Company's option every interest period, either (a) the LIBOR rate for Eurocurrency borrowing or (b) an Alternate Base Rate ("ABR"), which is the highest of (i) the administrative agent's prime rate, (ii) one-half of 1.00% in excess of the overnight U.S. Federal Funds rate, and (iii) 1.00% in excess of the one-month LIBOR), plus in each case, an applicable margin. The applicable margin for Eurocurrency loans ranges, based on the applicable total net leverage ratio, from 1.25% to 2.00% per annum and the applicable margin for ABR loans ranges, based on the applicable total net leverage ratio, from 0.25% to 1.00% per annum. Debt issuance costs of $10,158 attributable to the long term loan are amortized as interest expense over the contractual term of the loan using the effective interest rate. Upon pre-payment of the principal $260,000 as mentioned above, the Company amortized $5,300 of debt issuance costs in addition to $1,034 amortization expenses related to debt issuance costs recorded in 2017. The carrying values of the liability's components are reflected in the Company's accompanying consolidated balance sheets as follows:
|  | December 31, |
|  | 2017 |  |  | 2016 |
Principal |  | $ | 215,000 |  |  | $ | 475,000 |
Less: Debt issuance costs, net of amortization |  |  | (3,486 | ) |  |  | (9,820 | )
Net liability carrying amount |  | $ | 211,514 |  |  | $ | 465,180 |
Interest expense related to the liability is reflected on the accompanying consolidated statements of operations for the years ended December 31:
|  | December 31, |
|  | 2017 |  |  | 2016 |
Amortization of debt issuance costs |  | $ | 6,334 |  |  | $ | 338 |
Interest expense |  |  | 5,558 |  |  |  | 1,266 |
Total interest expense recognized |  | $ | 11,892 |  |  | $ | 1,604 |
Effective interest rate |  |  | 3.30% |  |  |  | 2.84% |
Revolving credit loan Pursuant to the Credit Agreement, the Company has also been granted a revolving credit facility that entitles the Company to borrow up to $75,000 through December 2021 with interest payable on the borrowed amount set at the same terms as the term loan, as well as a quarterly commitment fee on unfunded amounts ranging from 0.25% to 0.5%, subject to the achievement of certain leverage levels. As of December 31, 2017, no amounts had been funded. Debt issuance costs of $1,667 attributable to the revolving credit loan are capitalized and amortized as interest expense over the contractual term of the agreement on a straight line basis. Exchangeable Senior Notes and Hedging Transactions Exchangeable Senior Notes In January 2017, the Company issued $287,500 aggregate principal amount of Exchangeable Senior Notes (the “Notes”) due 2024. The following table summarizes some key facts and terms regarding the outstanding exchangeable senior notes:
|  | Due 2024 |
Issuance date |  | January 18, 2017 |
Maturity date |  | January 15, 2024 |
Principal amount |  | $ | 287,500 |
Cash coupon rate (per annum) |  |  | 1.25 | %
Conversion rate effective September 15, 2023 (per $1000 principal amount) |  |  | 12.026 |
Effective conversion price effective September 15, 2023 (per ADS) |  | $ | 83.15 |
Subject to satisfaction of certain conditions and during certain periods, as defined in the indenture governing the notes, the holders will have the option to exchange the notes for (i) cash, (ii) ADSs or (iii) a combination thereof, at the Company’s election. NICE may provide additional ADSs upon conversion if there is a "Make-Whole Fundamental Change" in the business as defined in the indenture governing the notes. The Notes are not redeemable by the Company prior to the maturity date apart from certain cases as defined in the indenture governing the Notes. Debt issuance costs of $5,791 attributable to the long term loan are amortized as interest expense over the contractual term of the loan using the effective interest rate. The carrying values of the liability and equity components of the exchangeable senior notes are reflected in the Company's accompanying consolidated balance sheets as follows:
|  | December 31, |
|  | 2017 |
Principal |  | $ | 287,500 |
Less: |  |  |  |
Debt issuance costs, net of amortization |  |  | (5,182 | )
Unamortized discount |  |  | (46,190 | )
Net liability carrying amount |  | $ | 236,128 |
Equity component - net carrying value |  | $ | 51,176 |
Interest is payable on the debentures semi-annually at the cash coupon rate; however, the remaining debt discount is being amortized as additional non-cash interest expense using an effective annual interest rate equal to the Company's estimated nonconvertible debt borrowing rate at the time of issuance. Interest expense related to the notes is reflected on the accompanying consolidated statements of operations for the year ended December 31:
|  | Year Ended December 31, |
|  | 2017 |
Amortization of debt issuance costs |  | $ | 609 |
Non-cash amortization of debt discount |  |  | 6,278 |
Interest expense |  |  | 3,414 |
Net liability carrying amount |  | $ | 10,301 |
Equity component - net carrying value |  |  | 4.68% |
Exchangeable notes hedge transactions In connection with the pricing of the Notes, the Company has entered into privately negotiated exchangeable note hedge transactions with some of the initial purchasers and/or their respective affiliates (the “option counterparties”). Subject to customary anti-dilution adjustments substantially similar to those applicable to the Notes, the exchangeable note hedge transactions cover the same number of ADSs that initially underlined the Notes. The note hedge transactions are expected generally to reduce potential dilution to the ADSs and/or offset potential cash payments the Company is required to make in excess of the principal amount, in each case, upon any exchange of the Exchangeable Notes. A portion of the call-options can be settled upon a surrender of the same amount of Exchangeable Senior Notes by a Holder. Settlement can be done in cash, ADSs or a combination of both, at NICE’s election. Concurrently with the Company’s entry into the exchangeable note hedge transactions, the Company has entered into warrant transactions with the option counterparties relating to the same number of ADSs (3,457,475), with a strike price of $101.82 per ADS, subject to customary anti‑dilution adjustments. The warrants are exercisable for a period of 3 months as of the notes maturity date. The Company has recorded a net decrease of $20,281 in additional paid in capital, due to its equity components.

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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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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