DEBT (Tables)

6 Months Ended

Jun. 30, 2017

As of June 30, 2017 and December 31, 2016 the following loan obligations were outstanding and classified as liabilities of the Company’s Consolidated CLOs:



	As of June 30, 2017					As of December 31, 2016
	Loan Obligations		Fair Value of Loan Obligations		Weighted Average Remaining Maturity In Years	Loan Obligations		Fair Value of Loan Obligations		Weighted Average Remaining Maturity In Years
Senior secured notes(1)	$	2,914,099	$	2,905,347	9.78	$	2,839,779	$	2,841,440	9.68
Subordinated notes(2)	257,209		188,251		10.05	284,046		189,672		9.97
Total loan obligations of Consolidated CLOs	$	3,171,308	$	3,093,598		$	3,123,825	$	3,031,112


(1)	Original borrowings under the senior secured notes totaled $3.2 billion, with various maturity dates ranging from October 2024 to April 2030. The weighted average interest rate as of June 30, 2017 was 3.72%.


(2)	Original borrowings under the subordinated notes totaled $257.2 million, with various maturity dates ranging from October 2024 to April 2030. They do not have contractual interest rates, but instead receive distributions from the excess cash flows generated by each Consolidated CLO.

The Consolidated Funds had the following revolving bank credit facilities and term loan outstanding as of June 30, 2017 and December 31, 2016:



				As of June 30, 2017				As of December 31, 2016
Consolidated Funds' Debt Facilities	Maturity Date	Total Capacity		Outstanding Loan(1)		Effective Rate		Outstanding Loan(1)		Effective Rate
Credit Facilities:
	1/1/2023	$	18,000	$	12,942	2.75%		$	12,942	2.38%
	6/30/2018	45,686		11,422		1.55%	(2)	42,128		1.55%	(2)
	3/7/2018	71,500		50,000		2.39%		N/A		N/A
Revolving Term Loan	8/19/2019	14,286		9,361		5.55%		N/A		N/A
Total borrowings				$	83,725			$	55,070


(1)	The fair values of the borrowings approximate the carrying value as the interest rate on the borrowings is a floating rate.


(2)	The effective rate is based on the three month EURIBOR or zero, whichever is higher, plus an applicable margin.

The following table summarizes the Company’s and its subsidiaries’ debt obligations:



					As of June 30, 2017			As of December 31, 2016
	Debt Origination Date	Maturity	Original Borrowing Amount		Carrying Value		Interest Rate	Carrying Value		Interest Rate
Credit Facility(1)	Revolver	2/24/2022	N/A		$	135,000	2.65%	$	—	—%
Senior Notes(2)	10/8/2014	10/8/2024	$	250,000	244,992		4.21%	244,684		4.21%
2015 Term Loan(3)	9/2/2015	7/29/2026	$	35,250	35,073		3.02%	35,063		2.74%
2016 Term Loan(4)	12/21/2016	1/15/2029	$	26,376	25,991		2.88%	26,037		2.66%
2017 Term Loan A(4)	3/22/2017	1/22/2028	$	17,600	17,470		2.70%	N/A		N/A
2017 Term Loan B(4)	5/10/2017	10/15/2029	$	35,198	35,124		2.63%	N/A		N/A
2017 Term Loan C(4)	6/22/2017	7/30/2029	$	17,211	17,206		2.75%	N/A		N/A
Total debt obligations					$	510,856		$	305,784

(1)

The AOG entities are borrowers under the Credit Facility, which, as amended in February 2017, provides a $1.04 billion revolving line of credit. It has a variable interest rate based on LIBOR or a base rate plus an applicable margin with an unused commitment fee paid quarterly, which is subject to change with the Company’s underlying credit agency rating. As of June 30, 2017, base rate loans bear interest calculated based on the base rate plus 0.50% and the LIBOR rate loans bear interest calculated based on LIBOR plus 1.50%. The unused commitment fee is 0.20% per annum. There is a base rate and LIBOR floor of zero.


(2)	The Senior Notes were issued in October 2014 by Ares Finance Co. LLC, a subsidiary of the Company, at 98.268% of the face amount with interest paid semi-annually. The Company may redeem the Senior Notes prior to maturity, subject to the terms of the indenture.

(3)

The 2015 Term Loan was entered into in August 2015 by a subsidiary of the Company that acts as a manager to a CLO. The 2015 Term Loan is secured by collateral in the form of CLO senior tranches owned by the Company. To the extent the assets are not sufficient to cover the Term Loan, there is no further recourse to the Company to fund or repay the remaining balance. Interest is paid quarterly, and the Company also pays a fee of 0.025% of a maximum investment amount.

(4)

The 2016 and 2017 Term Loans ("Term Loans") were entered into by a subsidiary of the Company. The Term Loans are secured by collateral in the form of CLO senior tranches and subordinated notes owned by the Company. Collateral associated with one of the Term Loans may be used to satisfy outstanding liabilities of another term loan should the collateral fall short. To the extent the assets associated with these Term Loans are not sufficient, there is no further recourse to the Company to fund or repay the remaining balance. Interest is paid quarterly, and the Company also pays a fee of 0.03% of a maximum investment amount.

The following table shows the activity of the Company's debt issuance costs:



	Credit Facility(1)			Senior Notes(2)			Term Loans(2)
Unamortized debt issuance costs as of December 31, 2016	$	4,800		$	1,803		$	526
Debt issuance costs incurred	3,343			—			276
Amortization of debt issuance costs	(863		)	(116		)	(32		)
Unamortized debt issuance costs as of June 30, 2017	$	7,280		$	1,687		$	770

(1) Unamortized debt issuance costs of the Credit Facility are included in other assets in the Condensed Consolidated Statements of Financial Condition.

(2) Unamortized debt issuance costs of the Senior Notes and Term Loans are presented on a net basis with the net carrying value of the Company’s debt obligations in the Condensed Consolidated Statements of Financial Condition.