Quarterly report pursuant to Section 13 or 15(d)

Debt (Tables)

v2.4.0.8
Debt (Tables)
 9 Months Ended
Sep. 30, 2014
Debt Disclosure [Abstract]  
Schedule of Debt
Debt consists of the following (in millions):
 
September 30,
2014
 
December 31,
2013
Revolving Credit Facility (a)
$
442.0

 
$
306.5

Senior Notes, including premium of $2.6 and $3.0 (b)
677.6

 
678.0

Capital leases (c)
71.3

 
74.9

Total debt
1,190.9

 
1,059.4

Less current portion of debt
(5.2
)
 
(4.9
)
Debt
$
1,185.7

 
$
1,054.5


(a)
Starz, LLC has entered into a credit agreement that provides for a $1,000.0 million senior secured revolving credit facility with a $50.0 million sub-limit for standby letters of credit (“Revolving Credit Facility”) which matures on November 16, 2016. As of September 30, 2014, $558.0 million of borrowing capacity was available under the Revolving Credit Facility.

Interest on each loan under the Revolving Credit Facility is payable at either an alternate base rate or LIBOR at Starz, LLC’s election. Borrowings that are alternate base rate loans bear interest at a per annum rate equal to the alternate base rate plus a margin that varies between 0.5% and 1.5% depending on the consolidated leverage ratio, as defined in the credit agreement. The alternate base rate is the highest of (a) the Prime Rate, (b) the Federal Funds Effective Rate plus ½ of 1.0% or (c) LIBOR for a one-month interest period plus 1.0%. Borrowings that are LIBOR loans bear interest at a per annum rate equal to the applicable LIBOR plus a margin that varies between 1.5% and 2.5% depending on the consolidated leverage ratio. The credit agreement requires Starz, LLC to pay a commitment fee on any unused portion under the Revolving Credit Facility. The commitment fee varies between 0.25% and 0.50%, depending on the consolidated leverage ratio.

As of September 30, 2014, the following borrowings and related LIBOR interest rates were outstanding under the Revolving Credit Facility (dollars in millions):

LIBOR period:
Interest Rate
 
Loan Amount
September 2014 to October 2014
1.9045%
 
$
35.0

September 2014 to October 2014
1.9061%
 
86.0

September 2014 to October 2014
1.9035%
 
312.0

September 2014 to October 2014
1.9015%
 
9.0

 
 
 
$
442.0


The credit agreement contains certain covenants that include restrictions on, among others, incurring additional debt, paying dividends, entering into liens or guarantees, or making certain distributions, investments and other restricted payments. In addition, Starz, LLC must comply with certain financial covenants, including a consolidated leverage ratio, as defined in the agreement. As of September 30, 2014, Starz, LLC was in compliance with all covenants under the credit agreement.

(b)
Starz, LLC and Starz Finance Corp., a wholly-owned subsidiary, co-issued $675.0 million aggregate principal amount of 5.0% senior notes due September 15, 2019 (the “Senior Notes”). The Senior Notes bear interest at a rate of 5.0% payable semi-annually on September 15 and March 15 of each year and are guaranteed by Starz Entertainment.

The Senior Notes contain certain covenants that include restrictions on, among others, incurring additional debt, paying dividends, entering into liens and guarantees, or making certain distributions, investments and other restricted payments. As of September 30, 2014, Starz, LLC was in compliance with all covenants under the Senior Notes.

(c)
On January 11, 2013, Starz, LLC entered into a commercial lease with a subsidiary of Liberty Media for its headquarters building. The term of the lease is ten years, with four successive five-year renewal periods at the option of Starz, LLC. Starz, LLC has recorded a $44.8 million capital lease in connection with this lease agreement with an imputed annual interest rate of 6.4%.

Starz Entertainment has entered into capital lease agreements for its transponder capacity. The agreements expire during 2018 to 2021 and have imputed annual interest rates ranging from 5.5% to