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Long-Term and Other Debt
 6 Months Ended
Jun. 30, 2020
Debt Disclosure [Abstract]  
Long-Term and Other Debt Long-Term and Other Debt
Issuance of 2025 Unsecured Notes and Redemption of 2021 Notes

On July 1, 2020, we completed the issuance of $550 million in aggregate principal amount of 8.625% senior unsecured notes due 2025 in a private offering, for which we received the total net proceeds of $543 million. We used a portion of the net proceeds to redeem all $341 million of our outstanding 2021 Notes and paid accrued and unpaid interest thereon plus related premiums, fees and costs, which redemption was completed on July 17, 2020, and will use the remaining net proceeds to fund working capital and general corporate purposes.

The 2025 Unsecured Notes were issued pursuant to an indenture dated as of July 1, 2020 (the “2025 Unsecured Notes Indenture”). We may redeem some or all of the 2025 Unsecured Notes at any time prior to July 1, 2022 at a redemption price equal to 100% of the principal amount of the 2025 Unsecured Notes plus accrued and unpaid interest, if any, to the date of the redemption plus a “make whole” premium. We may redeem some or all of the 2025 Unsecured Notes at any time on or after July 1, 2022 at the prices specified in the 2025 Unsecured Notes Indenture.

The 2025 Unsecured Notes are senior obligations of SGI, rank equally to all SGI’s existing and future senior debt and rank senior to all of SGI’s existing and future debt that is expressly subordinated to the 2025 Unsecured Notes. The 2025 Unsecured Notes are guaranteed on a senior unsecured basis by SGC and all of its wholly owned domestic restricted subsidiaries (other than SGI, the unrestricted business entities comprising our SciPlay business segment and certain immaterial subsidiaries), subject to customary exceptions.

Outstanding Debt and Finance Leases

        The following table reflects our outstanding debt (in order of Priority and Maturity):
As of
June 30, 2020December 31, 2019
Final MaturityRate(s)Face valueUnamortized debt discount/premium and deferred financing costs, netBook valueBook value
Senior Secured Credit Facilities:
SGI Revolver2024variable$635  $—  $635  $195  
SGI Term Loan B-52024variable4,080  (54) 4,026  4,042  
SciPlay Revolver2024variable—  —  —  —  
SGI Senior Notes:
2025 Secured Notes(1)
20255.000%1,250  (14) 1,236  1,235  
2026 Secured Euro Notes(2)
20263.375%365  (4) 361  359  
2026 Unsecured Euro Notes(2)
20265.500%281  (4) 277  276  
2026 Unsecured Notes20268.250%1,100  (13) 1,087  1,085  
2028 Unsecured Notes20287.000%700  (9) 691  690  
2029 Unsecured Notes20297.250%500  (7) 493  493  
SGI Subordinated Notes:
2021 Notes20216.625%341  (1) 340  339  
Finance lease obligations as of June 30,
2020 payable monthly through 2023 and
other(3)
20234.652%7  —  7  11  
Total long-term debt outstanding$9,259  $(106) $9,153  $8,725  
Less: current portion of long-term debt(384) (45) 
Long-term debt, excluding current portion$8,769  $8,680  
Fair value of debt(4)
$8,287  
(1) In connection with the February 2018 Refinancing (see Note 15 in our 2019 Form 10-K), we entered into certain cross-currency interest rate swap agreements to achieve more attractive interest rates by effectively converting $460 million of the fixed-rate, U.S. Dollar-denominated 2025 Secured Notes, including the semi-annual interest payments through October 2023, to a fixed-rate Euro-denominated debt, with a fixed annual weighted average interest rate of approximately 2.946%. These cross-currency swaps have been designated as a hedge of our net investment in certain subsidiaries.
(2) We designated a portion of our 2026 Secured Euro Notes as a net investment non-derivative hedge of our investments in certain of our international subsidiaries that use the Euro as their functional currency in order to reduce the volatility in our operating results caused by the change in foreign currency exchange rates of the Euro relative to the U.S. Dollar (see Note 12 for additional information). The total change in the face value of the 2026 Secured Euro Notes and 2026 Unsecured Euro Notes due to changes in foreign currency exchange rates since the issuance was a reduction of $67 million, of which a $12 million and $2 million loss were recognized on remeasurement of debt in the Consolidated Statements of Operations for the three and six months ended June 30, 2020, respectively.
(3) Includes $7 million related to certain revenue transactions presented as debt in accordance with ASC 470.
(4) Fair value of our fixed rate and variable interest rate debt is classified within Level 2 in the fair value hierarchy and has been calculated based on the quoted market prices of our securities.

Debt Maturities

Maturities for our outstanding debt were as follows as of June 30, 2020:
DueTotal Principal DueSeries of DebtPrincipal Due per Series of Debt
Remainder of 2020$361  Term Loan B-5$20  
2021 Notes(1)
341  
202142  Term Loan B-542  
202242  Term Loan B-542  
202342  Term Loan B-542  
20244,569  Term Loan B-53,934  
Drawn Revolving Credit Facility635  
2025 and beyond4,196  2025 Secured Notes1,250  
2026 Secured Euro Notes365  
2026 Unsecured Euro Notes281  
2026 Unsecured Notes1,100  
2028 Unsecured Notes700  
2029 Unsecured Notes500  
(1) On July 17, 2020, the 2021 Notes were redeemed using the proceeds from the issuance of the 2025 Unsecured Notes, which was completed on July 1, 2020.

        We were in compliance with the financial covenants under all debt agreements as of June 30, 2020 (see Note 1 for more detailed disclosure, including the amendment to SGI’s revolving credit facility).
For additional information regarding the terms of our credit facilities, Secured Notes, Unsecured Notes and the 2021 Notes, see Note 15 in our 2019 10-K.
Loss on Debt Financing Transactions
        The following are components of the loss on debt financing transactions resulting from debt extinguishment and modification accounting for the three and six months ended June 30, 2019, none of which were incurred in 2020:
Three and Six Months Ended June 30,
2019
Repayment and cancellation of principal balance at premium$50  
Unamortized debt (premium) discount and deferred financing costs, net10  
Total loss on debt financing transactions$60