Debt

The following table presents information about the terms and outstanding balances of Torchmark’s debt.

Selected Information about Debt Issues



						As of December 31,
						2015						2014
Description	Annual Interest Rate			Issue Date	Periodic Interest Payments Due	Outstanding Principal (Par Value)		Outstanding Principal (Book Value)		Outstanding Principal (Fair Value)		Outstanding Principal (Book Value)
Notes, due 5/15/23^(1,2)	7.875	%		5/93	5/15 & 11/15	$	165,612	$	163,920	$	204,470	$	163,758
Senior Notes, due 6/15/16^(1,3,7)	6.375	%		6/06	6/15 & 12/15	250,000		249,753		255,354		249,236
Senior Notes, due 6/15/19^(1,3)	9.250	%		6/09	6/15 & 12/15	292,647		291,002		353,978		290,618
Senior Notes, due 9/15/22^(1,3)	3.800	%		9/12	3/15 & 9/15	150,000		147,913		148,843		147,648
Junior Subordinated Debentures due 12/15/52^(4,8)	5.875	%		9/12	quarterly	125,000		120,898		129,000		120,870
Junior Subordinated Debentures due 3/15/36^(4,5)	3.812	%	⁽⁹⁾	⁽⁶⁾	quarterly	20,000		20,000		20,000		20,000
Total funded debt						1,003,259		993,486		1,111,645		992,130
Commercial Paper⁽⁷⁾						240,544		240,376		240,376		238,398
Total debt						$	1,243,803	$	1,233,862	$	1,352,021	$	1,230,528


(1)	All securities other than the Junior Subordinated Debentures have equal priority with one another.


(2)	Not callable.


(3)	Callable subject to “make-whole” premium.


(4)	Quarterly payments on the 15th of March, June, September, and December.


(5)	Callable anytime.


(6)	Assumed upon November 1, 2012 acquisition of Family Heritage.


(7)	Classified as short-term debt.


(8)	Callable as of December 15, 2017.


(9)	Interest paid at 3 month LIBOR plus 330 basis points, resets each quarter.

Contractual Debt Obligations: The following table presents expected scheduled principal payments under our contractual debt obligations:



	Year Ended December 31,
	2016		2017		2018		2019		2020		Thereafter
Debt obligations	$	490,544	$	—	$	—	$	292,647	$	—	$	460,612

Funded debt: As of January 1, 2013, Torchmark had outstanding 7.375% Notes with a principal balance of $94 million. These notes were repaid with interest on August 1, 2013.

Torchmark's 6.375% Senior Notes, in the principal amount of $250 million, will mature on June 15, 2016. The Company plans to refinance these notes in 2016.

Commercial Paper: As of July 16, 2014, Torchmark entered into a new credit facility with a group of lenders allowing for unsecured borrowings and stand-by letters of credit up to $750 million, replacing a previous facility that had a maximum limitation of $600 million. Up to $250 million in letters of credit can be issued against the new facility. The facility is further designated as a back-up credit line for a commercial paper program under which the Company may either borrow from the credit line or issue commercial paper at any time, with total commercial paper outstanding not to exceed the facility maximum, less any letters of credit issued. Interest is charged at variable rates. The facility has no ratings-based acceleration triggers which would require early repayment prior to the termination date of July 16, 2019. In accordance with the agreement, Torchmark is subject to certain covenants regarding capitalization, as was the case with the previous credit facility. As of December 31, 2015, and throughout the three-year period ended December 31, 2015, Torchmark was in full compliance with the appropriate covenants. Borrowings on the credit facilities are reported as short-term debt on the Consolidated Balance Sheets. A table presenting selected information concerning Torchmark’s short-term borrowings is presented below.

Short-Term Borrowings



	At December 31,
	2015			2014
Balance at end of period (at par value)	$	240,544		$	238,450
Annualized interest rate	0.55		%	0.32		%
Letters of credit outstanding	$	177,000		$	198,000
Remaining amount available under credit line	332,456			313,550



	Year Ended December 31,
	2015			2014			2013
Average balance outstanding during period	$	350,851		$	296,246		$	274,435
Daily-weighted average interest rate (annualized)	0.43		%	0.26		%	0.33		%
Maximum daily amount outstanding during period	$	458,110		$	343,000		$	340,140