4. Debt

The following is a summary of our debt (dollar amounts in thousands):


	As of September 30, 2016						As of December 31, 2015
	Balance			Interest Rate			Balance			Interest Rate
Revolving credit facility	$	—			Variable		$	1,100,000			Variable
2006 Senior Unsecured Notes due 2016		60,000			5.675	%		125,000			Various
2011 Senior Unsecured Notes		—			—			450,000			6.875	%
2012 Senior Unsecured Notes due 2022:
Principal amount		350,000			6.375	%		350,000			6.375	%
Unamortized premium		1,902						2,168

		351,902						352,168
2013 Senior Unsecured Notes due 2020(A)		224,700			5.750	%		217,240			5.750	%
2014 Senior Unsecured Notes due 2024		300,000			5.500	%		300,000			5.500	%
2015 Senior Unsecured Notes due 2022(A)		561,750			4.000	%		543,100			4.000	%
2016 Senior Unsecured Notes due 2024		500,000			6.375	%		—			—
2016 Senior Unsecured Notes due 2026		500,000			5.250	%		—			—
Term loans		263,179			Various			263,400			Various

	$	2,761,531					$	3,350,908
Debt issue costs, net		(32,982	)					(28,367	)

	$	2,728,549					$	3,322,541

(A)	These notes are Euro-denominated and reflect the exchange rate at September 30, 2016 and December 31, 2015, respectively.

As of September 30, 2016, principal payments due on our debt (which exclude the effects of any discounts, premiums, or debt issue costs recorded) are as follows (in thousands):


2016	$	60,078	(A)
2017		320
2018		12,781
2019		250,000
2020		224,700
Thereafter		2,211,750

Total	$	2,759,629

(A)	The remaining $60 million of our 2006 Senior Unsecured Notes were paid in full on October 31, 2016.

2016 Activity

On July 22, 2016, we completed a $500 million senior unsecured notes offering (“2026 Senior Unsecured Notes”). Interest on the notes is payable on February 1 and August 1 of each year, commencing on February 1, 2017. Interest on the notes is to be paid in cash at a rate of 5.25% per year. The notes mature on August 1, 2026. We may redeem some or all of the notes at any time prior to August 1, 2021 at a “make whole” redemption price. On or after August 1, 2021, we may redeem some or all of the notes at a premium that will decrease over time. In addition, at any time prior to August 1, 2019, we may redeem up to 35% of the notes at a redemption price equal to 105.25% of the aggregate principal amount thereof, plus accrued and unpaid interest thereon, using proceeds from one or more equity offerings. In the event of a change in control, each holder of the notes may require us to repurchase some or all of the notes at a repurchase price equal to 101% of the aggregate principal amount of the notes plus accrued and unpaid interest to the date of purchase.

We used the net proceeds from the 2026 Senior Unsecured Notes offering to redeem our $450 million 2011 Senior Unsecured Notes. This redemption resulted in a $22.5 million debt refinancing charge during the 2016 third quarter, consisting of a $15.5 million redemption premium along with the write-off of deferred debt issuance costs associated with the redeemed notes.

On February 22, 2016, we completed a $500 million senior unsecured notes offering (“2016 Senior Unsecured Notes”), proceeds of which were used to repay borrowings under our revolving credit facility. Interest on the notes is payable on March 1 and September 1 of each year, commencing on September 1, 2016. Interest on the notes is to be paid in cash at a rate of 6.375% per year. The notes mature on March 1, 2024. We may redeem some or all of the notes at any time prior to March 1, 2019 at a “make whole” redemption price. On or after March 1, 2019, we may redeem some or all of the notes at a premium that will decrease over time. In addition, at any time prior to March 1, 2019, we may redeem up to 35% of the notes at a redemption price equal to 106.375% of the aggregate principal amount thereof, plus accrued and unpaid interest thereon, using proceeds from one or more equity offerings. In the event of a change in control, each holder of the notes may require us to repurchase some or all of the notes at a repurchase price equal to 101% of the aggregate principal amount of the notes plus accrued and unpaid interest to the date of purchase.

2015 Activity

On July 27, 2015, we received a commitment to provide a senior unsecured bridge loan facility in the original principal amount of $1.0 billion to fund the acquisition of Capella. Funding under the bridge facility was not necessary as we funded the acquisition through a combination of an equity issuance and other borrowings. However, we incurred and expensed certain customary structuring and underwriting fees of $3.9 million in the third quarter related to the bridge commitment.

On August 19, 2015, we completed a €500 million senior unsecured notes offering (“2015 Senior Unsecured Notes”), proceeds of which were used to repay Euro-denominated borrowings under our credit facility and to fund our European investments.

On September 30, 2015, we amended our credit facility to, among other things, increase the aggregate commitment under our revolver to its current level of $1.3 billion and increase the term loan portion to $250 million. In addition, this amendment included a new accordion feature that allows us to expand our credit facility by another $400 million for a total commitment of $1.95 billion. This amendment resulted in a $0.1 million expense in the 2015 third quarter.

Other

During the 2010 second quarter, we entered into interest rate swaps to manage our exposure to variable interest rates by fixing the interest rate on the outstanding amount of our 2006 Senior Unsecured Notes. In July 2016, $65 million of the 2006 Senior Unsecured Notes was paid in full and the related swap expired. For the remaining $60 million, the interest rate swap, which started October 31, 2011 (date on which the related interest rate turned variable) and will continue through the maturity date (or October 2016) fixed the interest rate at 5.675%. The fair value of the interest rate swaps was $0.4 million and $2.9 million as of September 30, 2016 and December 31, 2015, respectively, which is reflected in accounts payable and accrued expenses on the consolidated balance sheets.

We account for interest rate swaps as cash flow hedges. Accordingly, the effective portion of changes in the fair value of our swaps is recorded as a component of accumulated other comprehensive income/loss on the balance sheet and reclassified into earnings in the same period, or periods, during which the hedged transactions effect earnings, while any ineffective portion is recorded through earnings immediately. We did not have any hedge ineffectiveness from inception of our interest rate swaps through September 30, 2016 and therefore, there was no income statement effect recorded during the three and nine month periods ended September 30, 2016 or 2015. We do expect current losses included in accumulated other comprehensive loss to be reclassified into earnings in October 2016. At September 30, 2016 and December 31, 2015, we have posted $0.4 million and $1.7 million, respectively, of collateral related to our interest rate swaps, which is reflected in other assets on our consolidated balance sheets.

Covenants

Our debt facilities impose certain restrictions on us, including restrictions on our ability to: incur debts; create or incur liens; provide guarantees in respect of obligations of any other entity; make redemptions and repurchases of our capital stock; prepay, redeem or repurchase debt; engage in mergers or consolidations; enter into affiliated transactions; dispose of real estate or other assets; and change our business. In addition, the credit agreements governing our revolving credit facility and term loan limit the amount of dividends we can pay as a percentage of normalized adjusted funds from operations (“FFO”), as defined in the agreements, on a rolling four quarter basis. At September 30, 2016, the dividend restriction was 95% of normalized adjusted FFO. The indentures governing our senior unsecured notes also limit the amount of dividends we can pay based on the sum of 95% of funds from operations, proceeds of equity issuances and certain other net cash proceeds. Finally, our senior unsecured notes require us to maintain total unencumbered assets (as defined in the related indenture) of not less than 150% of our unsecured indebtedness.

In addition to these restrictions, the revolving credit facility and term loan contain customary financial and operating covenants, including covenants relating to our total leverage ratio, fixed charge coverage ratio, secured leverage ratio, consolidated adjusted net worth, unsecured leverage ratio, and unsecured interest coverage ratio. This facility also contains customary events of default, including among others, nonpayment of principal or interest, material inaccuracy of representations and failure to comply with our covenants. If an event of default occurs and is continuing under the facility, the entire outstanding balance may become immediately due and payable. At September 30, 2016, we were in compliance with all such financial and operating covenants.