Old COPPER Company, Inc. - 10-K filing on 2015-03-23

Long-Term Debt

12 Months Ended

Jan. 31, 2015



($ in millions)	2014			2013
Issue:
5.65% Senior Notes Due 2020⁽¹⁾	$	400		$	400
5.75% Senior Notes Due 2018⁽¹⁾	300			300
6.375% Senior Notes Due 2036⁽¹⁾	400			400
6.875% Medium-Term Notes Due 2015	—			200
6.9% Notes Due 2026	2			2
7.125% Debentures Due 2023	10			10
7.4% Debentures Due 2037	326			326
7.625% Notes Due 2097	500			500
7.65% Debentures Due 2016	78			200
7.95% Debentures Due 2017	220			285
8.125% Senior Notes Due 2019	400			—
2013 Term Loan Facility	2,216			2,239
2014 Term Loan	498			—
Total debt, excluding capital leases and note payable	5,350			4,862
Less: current maturities	28			23
Total long-term debt, excluding capital leases and note payable	$	5,322		$	4,839
Weighted-average interest rate at year end	6.4		%	6.5		%
Weighted-average maturity (in years)	14 years


(1)	These debt issuances contain a change of control provision that would obligate us, at the holders’ option, to repurchase the debt at a price of 101%. These provisions trigger if there were a beneficial ownership change of 50% or more of our common stock.

2014 Debt Issuance and Tender Offers

In September 2014, we issued $400 million aggregate principal amount of 8.125% Senior Notes due 2019 and used the majority of the $393 million of proceeds from the offering, net of underwriting discounts, to pay the tender consideration and related transaction fees and expenses for our contemporaneous cash tender offers (2014 Tender Offers) to purchase approximately $327 million aggregate principal amount of the three outstanding series of debt securities described below (collectively, the Securities).



Title of Security	Principal Amount Outstanding Prior to 2014 Tender Offers ($ in millions)		Tender Premium⁽¹⁾		Principal Amount Tendered ($ in millions)		Principal Amount Accepted for Purchase ($ in millions)		Principal Amount Outstanding After the 2014 Tender Offers ($ in millions)
6.875% Medium-Term Notes due 2015	$	200	$	67.50	$	140	$	140	$	60
7.65% Debentures due 2016	200		105.00		122		122		78
7.95% Debentures due 2017	285		97.50		194		65		220
Total	$	685			$	456	$	327	$	358


(1)	Per $1,000 principal amount of Securities.

We paid approximately $362 million aggregate consideration, including $6 million of accrued interest, for the accepted Securities in October 2014. The 2014 Tender Offers resulted in a loss on extinguishment of debt of $30 million which includes the premium paid over face value of the accepted Securities of $29 million and reacquisition costs of $1 million.

2014 Debt Defeasance

In October 2014, subsequent to the completion of the 2014 Tender Offers, we deposited approximately $64 million with Wilmington Trust, National Association, as Trustee under the Indenture with respect to our 6.875% Medium-Term Notes due 2015 (2015 Notes), to effect a legal defeasance of the remaining outstanding principal amount of 2015 Notes. As a result of depositing funds with the Trustee sufficient to make all payments of interest and principal on the outstanding 2015 Notes through October 15, 2015, the stated maturity of the 2015 Notes, the Company has satisfied and discharged all of its obligations under the terms of the 2015 Notes and with respect to the 2015 Notes under the Indenture. The defeasance resulted in a loss on extinguishment of debt of $4 million which represents the portion of the deposited funds for future interest payments on the 2015 Notes.

2013 Tender Offer

On April 30, 2013 we announced the commencement of a cash tender offer (2013 Tender Offer) and consent solicitation for our 7.125% Debentures Due 2023 (2023 Notes). We also solicited consents to effect certain proposed amendments to the indenture governing the 2023 Notes (2023 Notes Indenture) that would eliminate most of the restrictive covenants and certain events of default and other provisions in the 2023 Notes Indenture (Proposed Amendments).

On May 22, 2013, we accepted for purchase $243 million in aggregate principal amount of the 2023 Notes, representing 95.41% of the outstanding principal amount, for aggregate Amended Tender Offer Consideration of $352 million. On June 5, 2013, we accepted for purchase an additional $2 million in aggregate principal amount of the 2023 Notes, for aggregate tender offer consideration of $3 million. The 2013 Tender Offer resulted in a loss on the extinguishment of debt of $114 million which includes the premium paid over face value of the accepted 2023 Notes of $110 million, reacquisition costs of $2 million and the write-off of unamortized debt issue costs of $2 million. As a result of receiving the requisite consent of the holders of at least 66 2/3% of aggregate principal amount of 2023 Notes outstanding, the Proposed Amendments were approved and became operative.

2013 Term Loan Facility

On May 22, 2013, JCP entered into a $2.25 billion five-year senior secured term loan facility (2013 Term Loan Facility). The 2013 Term Loan Facility is guaranteed by J. C. Penney Company, Inc. and certain subsidiaries of JCP, and is secured by mortgages on certain real estate of JCP and the guarantors, in addition to substantially all other assets of JCP and the guarantors. Proceeds of the 2013 Term Loan Facility were used to fund the 2013 Tender Offer and will be used to fund ongoing working capital requirements and general corporate purposes. The 2013 Term Loan Facility bears interest at a rate of LIBOR plus 5.0%. We are required to make quarterly repayments in a principal amount equal to $5.625 million during the five-year term, subject to certain reductions for mandatory and optional prepayments.

Scheduled Annual Principal Payments on Long-Term Debt, Excluding Capital Leases and Note Payable



($ in millions)
2015	$	28
2016	106
2017	248
2018	2,454
2019	878
Thereafter	1,636
Total	$	5,350