Long-Term Debt

The Company’s debt at June 30, 2019 and December 31, 2018 consisted of the following (in thousands):



	June 30, 2019
	Outstanding Principal		Unamortized Premium (Discount)			Unamortized Deferred Financing Costs (1)			Net Carrying Amount
Senior Secured Revolving Credit Facilities	$	134,000	$	—		$	—		$	134,000
8.750% Senior Notes due 2020	454,299		1,125			(2,659		)	452,765
8.875% Senior Secured Notes Due 2022	270,000		(1,889		)	(527		)	267,584
7.875% Senior Secured Notes Due 2022	900,000		17,865			(11,165		)	906,700
7.625% Senior Notes Due 2023	400,000		—			(3,502		)	396,498
8.500% Senior Secured Notes Due 2024	225,000		—			(4,881		)	220,119
Senior Secured Term Loan - noncurrent	795,825		—			(8,742		)	787,083
Total Long-Term Debt	3,179,124		17,101			(31,476		)	3,164,749
Senior Secured Term Loan - current	8,100		—			—			8,100
Total Debt	$	3,187,224	$	17,101		$	(31,476	)	$	3,172,849



	December 31, 2018
	Outstanding Principal		Unamortized Premium (Discount)			Unamortized Deferred Financing Costs (1)			Net Carrying Amount
8.75% Senior Notes due 2020	$	679,299	$	2,230		$	(5,380	)	$	676,149
8.875% Senior Secured Notes due 2022	270,000		(2,122		)	(602		)	267,276
7.875% Senior Secured Notes due 2022	900,000		20,178			(12,799		)	907,379
7.625% Senior Notes Due 2023	400,000		—			(3,922		)	396,078
Senior Secured Term Loan - noncurrent	799,875		—			(9,662		)	790,213
Total Long-Term Debt	3,049,174		20,286			(32,365		)	3,037,095
Senior Secured Term Loan - current	8,100		—			—			8,100
Total Debt	$	3,057,274	$	20,286		$	(32,365	)	$	3,045,195


(1)	Unamortized deferred financing costs related to the revolving credit facilities included in deferred financing costs, net on the condensed consolidated balance sheets at June 30, 2019 and December 31, 2018 were $1.6 million and $2.1 million, respectively.

Notes Payable

2020 Notes

As of June 30, 2019, APX had $454.3 million outstanding aggregate principal amount of 8.75% senior notes due 2020 (the “2020 notes”) with a maturity date of December 1, 2020.

2022 Private Placement Notes

As of June 30, 2019, APX had $270.0 million outstanding aggregate principal amount of 8.875% senior secured notes due 2022 (the “2022 private placement notes”). The 2022 private placement notes will mature on December 1, 2022, unless on September 1, 2020 (the 91st day prior to the maturity of the 2020 notes) more than an aggregate principal amount of $190.0 million of such 2020 notes remain outstanding or have not been refinanced as permitted under the note purchase agreement for the 2022 private placement notes, in which case the 2022 private placement notes will mature on September 1, 2020. The 2022 private placement notes are secured, on a pari passu basis, by the collateral securing obligations under the 2022 private placement notes, the 2022 notes (as defined below), the 2024 notes (as defined below) and the revolving credit facilities and the Term Loan (as defined below), in all cases, subject to certain exceptions and permitted liens.

2022 Notes

As of June 30, 2019, APX had $900.0 million outstanding aggregate principal amount of 7.875% senior secured notes due 2022 (the “2022 notes”). The 2022 notes will mature on December 1, 2022, or on such earlier date when any outstanding pari passu lien indebtedness matures as a result of the operation of any “Springing Maturity” provision set forth in the agreements governing such pari passu lien indebtedness. The 2022 notes are secured, on a pari passu basis, by the collateral securing obligations under the 2022 private placement notes, the 2024 notes (as defined below), the revolving credit facilities and the Term Loan, in all cases, subject to certain exceptions and permitted liens.

2023 Notes

As of June 30, 2019, APX had $400.0 million outstanding aggregate principal amount of the 7.625% senior notes due 2023 (the “2023 notes”) with a maturity date of September 1, 2023.

2024 Notes

In May 2019, APX issued $225.0 million outstanding aggregate principal amount of 8.50% senior secured notes due 2024 (the “2024 notes” and, together with the 2020 notes, the 2022 notes, the 2022 private placement notes and the 2023 notes the “Notes”). The net proceeds from the 2024 notes offering were used to redeem $225.0 million aggregate principal amount of our 2020 notes, and to pay the related accrued interest and to pay all fees and expenses related thereto. The 2024 notes will mature on November 1, 2024, or on such earlier date as may result from the operation of certain springing maturity provisions set forth in the indenture governing the 2024 notes. The 2024 notes are secured, on a pari passu basis, by the collateral securing obligations under the 2022 private placement notes, the 2022 notes, the revolving credit facilities and the Term Loan, in all cases, subject to certain exceptions and permitted liens.

Interest accrues at the rate of 8.75% per annum for the 2020 notes, 8.875% per annum for the 2022 private placement notes, 7.875% per annum for the 2022 notes, 7.625% per annum for the 2023 notes and 8.50% per annum for the 2024 notes. Interest on the 2020 notes, 2022 private placement notes and 2022 notes is payable semiannually in arrears on June 1 and December 1 of each year. Interest on the 2023 notes is payable semiannually in arrears on March 1 and September 1 of each year. Interest on the 2024 notes is payable semiannually in arrears on May 1 and November 1 each year. APX may redeem the Notes at the prices and on the terms specified in the applicable indenture, or the note purchase agreement.

Term Loan

In September 2018, APX entered into a credit agreement (the “September 2018 issuance”) for total term loans of $810.0 million (the “Term Loan”). The Company is required to make quarterly amortization payments under the Term Loan in an amount equal to 0.25% of the aggregate principal amount of Term Loan outstanding on the closing date thereof. The remaining principal amount outstanding under the Term Loan will be due and payable in full on March 31, 2024, or earlier if certain springing maturity conditions apply. The net proceeds from the Term Loan were used in-part to redeem in full the entire $269.5 million outstanding aggregate principal amount of the 2019 notes and pay the related accrued interest and redemption premium, to repurchase approximately $250.7 million aggregate principal amount of the outstanding 2020 notes, to repay the outstanding borrowings under the revolving credit facility and to pay fees and expenses related to the Term Loan and the transactions described above.

Borrowings under the Term Loan bear interest at a rate per annum equal to an applicable margin plus, at the Company's option, either (1) the base rate determined by reference to the highest of (a) the federal funds rate plus 0.50%, (b) the prime rate of Bank of America, N.A. and (c) the LIBOR rate determined by reference to the costs of funds for U.S. dollar deposits for an interest period of one month, plus 1.00% or (2) the LIBOR rate determined by reference to the London interbank offered rate for dollars for the interest period relevant to such borrowing. The applicable margin for base rate-based borrowings is 4.0% per annum and the applicable margin for LIBOR rate-based borrowings is 5.0% per annum. APX may prepay the Term Loan at the prices and on the terms specified in the credit agreement covering the Term Loan.

Debt Modifications and Extinguishments

The Company performs analyses on a creditor-by-creditor basis for debt modifications and extinguishments to determine if repurchased debt was substantially different than debt issued to determine the appropriate accounting treatment of associated issuance costs. As a result of these analyses, the following amounts of other expense and loss on extinguishment and deferred financing costs were recorded (in thousands):



	Original premium extinguished			Previously deferred financing costs extinguished		Total other expense and loss on extinguishment		New deferred financing costs
Three and six months ended June 30, 2019
May 2019 issuance	$	(588	)	$	1,395	$	807	$	4,956

Deferred financing costs are amortized to interest expense over the life of the issued debt. The Company had no debt issuances or related modification or extinguishment costs during the three and six months ended June 30, 2018.

The following table presents deferred financing activity for the six months ended June 30, 2019 and year ended December 31, 2018 (in thousands):



	Unamortized Deferred Financing Costs
	Balance December 31, 2018		Additions		Early Extinguishment			Amortized			Balance June 30, 2019
Revolving Credit Facility	$	2,058	$	—	$	—		$	(486	)	$	1,572
2020 Notes	5,380		—		(1,395		)	(1,326		)	2,659
2022 Private Placement Notes	602		—		—			(75		)	527
2022 Notes	12,799		—		—			(1,634		)	11,165
2023 Notes	3,922		—		—			(420		)	3,502
2024 Notes	—		4,956		—			(75		)	4,881
Term Loan	9,662				—			(920		)	8,742
Total Deferred Financing Costs	$	34,423	$	4,956	$	(1,395	)	$	(4,936	)	$	33,048



	Unamortized Deferred Financing Costs
	Balance December 31, 2017		Additions		Early Extinguishment			Amortized			Balance December 31, 2018
Revolving Credit Facility	$	3,099	$	—	$	—		$	(1,041	)	$	2,058
2019 Notes	2,877		—		(1,877		)	(1,000		)	—
2020 Notes	11,209		—		(2,330		)	(3,499		)	5,380
2022 Private Placement Notes	752		—		—			(150		)	602
2022 Notes	16,067		—		—			(3,268		)	12,799
2023 Notes	4,762		—		—			(840		)	3,922
Term Loan	—		10,275		—			(613		)	9,662
Total Deferred Financing Costs	$	38,766	$	10,275	$	(4,207	)	$	(10,411	)	$	34,423

Revolving Credit Facility

On November 16, 2012, APX entered into a $200.0 million senior secured revolving credit facility, with a five year maturity. On March 6, 2015, APX amended and restated the credit agreement governing the revolving credit facility to provide for, among other things, (1) an increase in the aggregate commitments previously available to APX thereunder from $200.0 million to $289.4 million (“Revolving Commitments”) and (2) the extension of the maturity date with respect to certain of the previously available commitments. On August 10, 2017, APX further amended and restated the credit agreement governing the revolving credit facility to provide for, among other things, (1) an increase in the aggregate commitments previously available to the Company from $289.4 million to $324.3 million and (2) the extension of the maturity date with respect to certain of the previously available commitments.

Borrowings under the amended and restated revolving credit facility bear interest at a rate per annum equal to an applicable margin plus, at APX’s option, either (1) the base rate determined by reference to the highest of (a) the Federal Funds rate plus 0.50%, (b) the prime rate of Bank of America, N.A. and (c) the LIBOR rate determined by reference to the costs of funds for U.S. dollar deposits for an interest period of one month, plus 1.00% or (2) the LIBOR rate determined by reference to the London interbank offered rate for dollars for the interest period relevant to such borrowing. The applicable margin for base rate-based borrowings (1)(a) under the Series A Revolving Commitments of approximately $267.0 million is and, when in effect, the Series D Revolving Commitments of approximately $15.4 million was 2.0% per annum and (b) under the Series B Revolving Commitments of approximately $21.2 million was 3.0% and (2)(a) the applicable margin for LIBOR rate-based borrowings (a) under the Series A Revolving Commitments is, and, when in effect, the Series D Revolving Commitments is currently 3.0% per annum and (b) under the Series B Revolving Commitments is currently 4.0%. The applicable margin for borrowings under the revolving credit facility is subject to one step-down of 25 basis points based on APX meeting a consolidated first lien net leverage ratio test at the end of each fiscal quarter. Outstanding borrowings under the amended and restated revolving credit facility are allocated on a pro-rata basis between each Series based on the total Revolving Commitments.

In addition to paying interest on outstanding principal under the revolving credit facility, APX is required to pay a quarterly commitment fee (which will be subject to one interest rate step-down of 12.5 basis points, based on APX meeting a consolidated first lien net leverage ratio test) to the lenders under the revolving credit facility in respect of the unutilized commitments thereunder. APX also pays customary letter of credit and agency fees.

APX is not required to make any scheduled amortization payments under the revolving credit facility. The Series D Revolving Commitments of $15.4 million expired effective April 1, 2019 and the principal amount outstanding under the revolving credit facility will be due and payable in full with respect to the extended commitments under the Series A Revolving Credit Facility and Series B Revolving Credit Facility on March 31, 2021.

As of June 30, 2019 there was $134.0 million of outstanding borrowings under the revolving credit facility. As of December 31, 2018, there were no outstanding borrowings under the revolving credit facility. As of June 30, 2019 the Company had $140.3 million of availability under the revolving credit facility (after giving effect to $13.9 million of letters of credit outstanding and $134.0 million of borrowings).

Guarantees

All of the obligations under the credit agreement governing the revolving credit facility, the credit agreement governing the Term Loan and the debt agreements governing the Notes are guaranteed by APX Group Holdings, Inc. and each of APX Group, Inc.'s existing and future material wholly-owned U.S. restricted subsidiaries. However, such subsidiaries shall only be required to guarantee the obligations under the debt agreements governing the Notes for so long as such entities guarantee the obligations under the revolving credit facility, the credit agreement governing the Term Loan or the Company's other indebtedness.