DEBT

12 Months Ended

Dec. 31, 2019

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


					As of December 31, 2019					As of December 31, 2018
	Debt Origination Date	Maturity	Original Borrowing Amount		Carrying Value		Interest Rate	Carrying Value		Interest Rate
Credit Facility⁽¹⁾	Revolver	3/21/2024	N/A		$	70,000	3.06%	$	235,000	4.00%
Senior Notes⁽²⁾	10/8/2014	10/8/2024	$	250,000	246,609		4.21%	245,952		4.21%
Total debt obligations					$	316,609		$	480,952

(1)The AOG entities are borrowers under the Credit Facility, which provides a $1.065 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. On March 21, 2019, the Company amended the Credit Facility to, among other things, extend the maturity date from February 2022 to March 2024 and to reduce borrowing costs on the drawn and undrawn amounts. As of December 31, 2019, base rate loans bear interest calculated based on the base rate plus 0.25% and the LIBOR rate loans bear interest calculated based on LIBOR plus 1.25%. The unused commitment fee is 0.15% 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.

As of December 31, 2019, the Company and its subsidiaries were in compliance with all covenants under the debt obligations.

The Company typically incurs and pays debt issuance costs when entering into a new debt obligation or when amending an existing debt agreement. Debt issuance costs related to the Company's Senior Notes are recorded as a reduction of the corresponding debt obligation, and debt issuance costs related to the Credit Facility are included in other assets in the Consolidated Statements of Financial Condition. All debt issuance costs are amortized over the remaining term of the related obligation.

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


	Credit Facility		Senior Notes		Term Loans		Repurchase Agreement Loan
Unamortized debt issuance costs as of December 31, 2017	$	6,543	$	1,571	$	1,171	$	—
Debt issuance costs incurred	—		—		98		259
Amortization of debt issuance costs	(1,571)		(237)		(56)		(7)
Debt extinguishment expense	—		—		(1,213)		(252)
Unamortized debt issuance costs as of December 31, 2018	4,972		1,334		—		—
Debt issuance costs incurred	1,594		—		—		—
Amortization of debt issuance costs	(1,311)		(232)		—		—

Unamortized debt issuance costs as of December 31, 2019	$	5,255	$	1,102	$	—	$	—

Loan Obligations of the Consolidated CLOs

Loan obligations of the Consolidated Funds that are CLOs (“Consolidated CLOs”) represent amounts due to holders of debt securities issued by the Consolidated CLOs. The Company measures the loan obligations of the Consolidated CLOs using the fair value of the financial assets of its Consolidated CLOs.

As of December 31, 2019 and December 31, 2018, the following loan obligations were outstanding and classified as liabilities of the Consolidated CLOs:


	As of December 31, 2019									As of December 31, 2018
	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)	$	7,738,337	$	7,700,038	10.97	$	6,642,616	$	6,391,643	10.94
Subordinated notes(2)	449,877		273,710		11.02	455,333		286,448		11.21
Total loan obligations of Consolidated CLOs	$	8,188,214	$	7,973,748		$	7,097,949	$	6,678,091

(1)Original borrowings under the senior secured notes totaled $7.7 billion, with various maturity dates ranging from July 2028 to October 2032. The weighted average interest rate as of December 31, 2019 was 2.91%.

(2)Original borrowings under the subordinated notes totaled $449.9 million, with various maturity dates ranging from July 2028 to October 2032. The notes do not have contractual interest rates, instead holders of the notes receive distributions from the excess cash flows generated by each Consolidated CLO.

Loan obligations of the Consolidated CLOs are collateralized by the assets held by the Consolidated CLOs, consisting of cash and cash equivalents, corporate loans, corporate bonds and other securities. The assets of one Consolidated CLO may not be used to satisfy the liabilities of another Consolidated CLO. Loan obligations of the Consolidated CLOs include floating rate notes, deferrable floating rate notes, revolving lines of credit and subordinated notes. Amounts borrowed under the notes are repaid based on available cash flows subject to priority of payments under each Consolidated CLO’s governing documents. Based on the terms of these facilities, the creditors of the facilities have no recourse to the Company.

Credit Facilities of the Consolidated Funds

Certain Consolidated Funds maintain credit facilities to fund investments between capital drawdowns. These facilities generally are collateralized by the unfunded capital commitments of the Consolidated Funds’ limited partners, bear an annual commitment fee based on unfunded commitments and contain various affirmative and negative covenants and reporting obligations, including restrictions on additional indebtedness, liens, margin stock, affiliate transactions, dividends and distributions, release of capital commitments and portfolio asset dispositions. The creditors of these facilities have no recourse to the Company and only have recourse to a subsidiary of the Company to the extent the debt is guaranteed by such subsidiary. Credit facilities of the Consolidated Funds are reflected at cost in the Consolidated Statements of Financial Condition. As of December 31, 2019 and December 31, 2018, the Consolidated Funds were in compliance with all covenants under such credit facilities.

The Consolidated Funds had the following revolving bank credit facilities and term loan outstanding as of December 31, 2019 and December 31, 2018:


				As of December 31, 2019						As of December 31, 2018
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	$	17,550	3.44%		$	14,953	3.98%
	12/29/2019(2)	—		—		—		43,624		1.55	(3)
	3/7/2020	71,500		71,500		3.14		71,500		3.47
	6/30/2021	196,315		—		1.00	(3)	38,844		1.00	(3)
	7/15/2028	75,000		17,000		4.75		39,000		4.75
Revolving Term Loan	1/31/2022	1,900		1,194		7.70		1,363		8.07
Total borrowings of Consolidated Funds				$	107,244			$	209,284

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

(2)On August 27, 2019, the facility was terminated at the Consolidated Fund's discretion.

(3)The effective rate is based on the three month EURIBOR or zero, whichever is higher, plus a spread of 1.00% or 1.55%.