v3.20.2

Debt | 6 Months Ended
--- | ---
Jun. 30, 2020
Debt Disclosure [Abstract] |
Debt | Debt Our debt at June 30, 2020 and December 31, 2019, was as follows (in millions):
| June 30, 2020 |  | December 31, 2019
First Lien Term Loans | $ | 3,155 |  |  | $ | 3,167 |
Senior Unsecured Notes | 3,042 |  |  | 3,663 |
First Lien Notes | 2,408 |  |  | 2,835 |
CCFC Term Loan | 962 |  |  | 967 |
GPC Term Loan | 867 |  |  | — |
Project financing, notes payable and other | 481 |  |  | 879 |
Finance lease obligations | 68 |  |  | 73 |
Revolving facilities | 122 |  |  | 122 |
Subtotal | 11,105 |  |  | 11,706 |
Less: Current maturities | 231 |  |  | 1,268 |
Total long-term debt | $ | 10,874 |  |  | $ | 10,438 |
Our effective interest rate on our consolidated debt, excluding the effects of capitalized interest and mark-to-market gains (losses) on interest rate hedging instruments, decreased to 5.3% for the six months ended June 30, 2020, from 5.9% for the same period in 2019. First Lien Term Loans The amounts outstanding under our First Lien Term Loans are summarized in the table below (in millions):
| June 30, 2020 |  | December 31, 2019
2024 First Lien Term Loan | $ | 1,508 |  |  | $ | 1,514 |
2026 First Lien Term Loans | 1,647 |  |  | 1,653 |
Total First Lien Term Loans | $ | 3,155 |  |  | $ | 3,167 |
Senior Unsecured Notes The amounts outstanding under our Senior Unsecured Notes are summarized in the table below (in millions):
| June 30, 2020 |  | December 31, 2019
2023 Senior Unsecured Notes(1) | $ | — |  |  | $ | 623 |
2024 Senior Unsecured Notes(2) | 479 |  |  | 479 |
2025 Senior Unsecured Notes(2) | 1,175 |  |  | 1,174 |
2028 Senior Unsecured Notes(1) | 1,388 |  |  | 1,387 |
Total Senior Unsecured Notes | $ | 3,042 |  |  | $ | 3,663 |
____________
(1) | On January 21, 2020, we redeemed the outstanding $623 million in aggregate principal amount of our 2023 Senior Unsecured Notes, which was included in debt, current portion on our Consolidated Condensed Balance Sheet at December 31, 2019, with the proceeds from the 2028 Senior Unsecured Notes, which was included in cash and cash equivalents on our Consolidated Condensed Balance Sheet at December 31, 2019.
(2) | On August 10, 2020, we utilized proceeds from our 2029 Senior Unsecured Notes and 2031 Senior Unsecured Notes, together with cash on hand, to purchase approximately $255 million and $1,045 million in aggregate principal amount of our 2024 Senior Unsecured Notes and 2025 Senior Unsecured Notes, respectively. On August 12, 2020, we redeemed the remaining amounts outstanding under our 2024 Senior Unsecured Notes and 2025 Senior Unsecured Notes.
On August 10, 2020, we issued $650 million in aggregate principal amount of 4.625% senior unsecured notes due 2029 and $850 million in aggregate principal amount of 5.000% senior unsecured notes due 2031 in private placements. The 2029 Senior Unsecured Notes bear interest at 4.625% per annum and the 2031 Senior Unsecured Notes bear interest at 5.000% per annum with interest payable on both series of notes semi-annually on February 1 and August 1 of each year, beginning on February 1, 2021. The 2029 Senior Unsecured Notes and 2031 Senior Unsecured Notes mature on February 1, 2029 and February 1, 2031, respectively. We used the net proceeds from the 2029 Senior Unsecured Notes and 2031 Senior Unsecured Notes, together with cash on hand, to pay the consideration in connection with the tender offers and redeem any of the 2024 Senior Unsecured Notes and 2025 Senior Unsecured Notes not tendered in connection with the tender offers. First Lien Notes The amounts outstanding under our First Lien Notes are summarized in the table below (in millions):
| June 30, 2020 |  | December 31, 2019
2022 First Lien Notes(1) | $ | — |  |  | $ | 245 |
2024 First Lien Notes(2) | — |  |  | 184 |
2026 First Lien Notes | 1,173 |  |  | 1,172 |
2028 First Lien Notes | 1,235 |  |  | 1,234 |
Total First Lien Notes | $ | 2,408 |  |  | $ | 2,835 |
____________
(1) | On January 21, 2020, we redeemed the outstanding $245 million in aggregate principal amount of our 2022 First Lien Notes, which was included in debt, current portion on our Consolidated Condensed Balance Sheet at December 31, 2019, with the proceeds from the 2028 First Lien Notes, which was included in cash and cash equivalents on our Consolidated Condensed Balance Sheet at December 31, 2019.
(2) | On January 21, 2020, we redeemed the outstanding $184 million in aggregate principal amount of our 2024 First Lien Notes, which was included in debt, current portion on our Consolidated Condensed Balance Sheet at December 31, 2019, with the proceeds from the 2028 First Lien Notes, which was included in cash and cash equivalents on our Consolidated Condensed Balance Sheet at December 31, 2019.
GPC Term Loan On June 9, 2020, GPC and the guarantors party thereto entered into a seven-year $900 million first lien senior secured term loan facility and three senior secured revolving letter of credit facilities totaling $200 million. The GPC Term Loan is certified under the Climate Bonds Standard. Any letters of credit issued under the GPC Term Loan letter of credit facilities must be at the request of and for the account of GPC. The GPC Term Loan bears interest, at GPC’s option, at either (i) the Base Rate, equal to the highest of (a) the Federal Funds Rate plus 0.50% per annum, (b) the prime rate published in the Wall Street Journal, or (c) 1.0% plus an applicable margin of 1.0%, increasing by 0.125% every three years, or (ii) LIBOR plus an applicable margin of 2.0% per annum, increasing by 0.125% every three years. The GPC Term Loan matures on June 9, 2027, but may be prepaid at any time upon irrevocable notice to the Administrative Agent. We used a portion of the proceeds from the GPC Term Loan to repay project debt associated with Steamboat as further discussed below. The GPC Term Loan is secured by certain real and personal property of GPC consisting primarily of the Geysers Assets. The GPC Term Loan is not guaranteed by Calpine Corporation and is without recourse to Calpine Corporation or any of our non-GPC subsidiaries or assets; however, GPC generates a portion of its cash flows from an intercompany tolling agreement with Calpine Energy Services, L.P. and has various service agreements in place with other subsidiaries of Calpine Corporation. Project Financing, Notes Payable and Other On June 12, 2020, we used a portion of the proceeds from the GPC Term Loan to repay approximately $342 million in carrying value of project debt associated with Steamboat and recorded approximately $8 million in loss on extinguishment of debt during the second quarter of 2020. On July 1, 2020, PG&E and PG&E Corporation emerged from bankruptcy. Our Russell City Energy Center and Los Esteros Critical Energy Facility sell energy and energy-related products to PG&E through PPAs. Subsequent to the bankruptcy filing, we received all material payments under the PPAs, either directly or through the application of collateral. As a result of PG&E’s bankruptcy, we were temporarily unable to make distributions from our Russell City and Los Esteros projects in accordance with the terms of the project debt agreements associated with each related project. Under PG&E's plan of reorganization, our PPAs were assumed and any restrictions on distributing cash from our Russell City and Los Esteros projects were cured. Additionally, the forbearance agreements associated with our Russell City and Los Esteros project debt agreements were terminated in accordance with the terms of the agreements. Accordingly, following removal of bankruptcy proceeding restrictions, our Russell City and Los Esteros projects will distribute funds in the amount of $88 million to Calpine Corporation in August 2020. Corporate Revolving Facility and Other Letter of Credit Facilities The table below represents amounts issued under our letter of credit facilities at June 30, 2020 and December 31, 2019 (in millions):
| June 30, 2020 |  | December 31, 2019
Corporate Revolving Facility(1) | $ | 462 |  |  | $ | 604 |
CDHI | 3 |  |  | 3 |
Various project financing facilities(2) | 336 |  |  | 184 |
Other corporate facilities(3) | 275 |  |  | 294 |
Total | $ | 1,076 |  |  | $ | 1,085 |
____________
(1) | The Corporate Revolving Facility represents our primary revolving facility and matures on March 8, 2023.
(2) | On June 9, 2020, we entered into the GPC Term Loan which provides for $200 million in letter of credit facilities.
(3) | On April 9, 2020, we amended one of our unsecured letter of credit facilities to partially extend the maturity of $100 million in commitments from June 20, 2020 to June 20, 2022.
Fair Value of Debt We record our debt instruments based on contractual terms, net of any applicable premium or discount and debt issuance costs. The following table details the fair values and carrying values of our debt instruments at June 30, 2020 and December 31, 2019 (in millions):
| June 30, 2020 |  | December 31, 2019
| Fair Value |  | Carrying Value |  | Fair Value |  | Carrying Value
First Lien Term Loans | $ | 3,081 |  |  | $ | 3,155 |  |  | $ | 3,238 |  |  | $ | 3,167 |
Senior Unsecured Notes | 3,027 |  |  | 3,042 |  |  | 3,764 |  |  | 3,663 |
First Lien Notes | 2,404 |  |  | 2,408 |  |  | 2,929 |  |  | 2,835 |
CCFC Term Loan | 941 |  |  | 962 |  |  | 982 |  |  | 967 |
GPC Term Loan | 900 |  |  | 867 |  |  | — |  |  | — |
Project financing, notes payable and other(1) | 426 |  |  | 419 |  |  | 822 |  |  | 817 |
Revolving facilities | 122 |  |  | 122 |  |  | 122 |  |  | 122 |
Total | $ | 10,901 |  |  | $ | 10,975 |  |  | $ | 11,857 |  |  | $ | 11,571 |
____________
(1) | Excludes an agreement that is accounted for as a failed sale-leaseback transaction under U.S. GAAP.
Our First Lien Term Loans, Senior Unsecured Notes, First Lien Notes and CCFC Term Loan are categorized as level 2 within the fair value hierarchy. Our GPC Term Loan, revolving facilities and project financing, notes payable and other debt instruments are categorized as level 3 within the fair value hierarchy. We do not have any debt instruments with fair value measurements categorized as level 1 within the fair value hierarchy.

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