7. Senior Notes

In August 2017, we issued $500.0 million aggregate principal amount of unsecured 7.875% senior notes due 2025, or 2025 Notes, and received net proceeds of $489.1 million after deducting underwriting discounts, commissions and estimated expenses. The 2025 Notes bear interest at 7.875% per year and mature on August 15, 2025. Interest on the 2025 Notes is payable semiannually in arrears on February 15 and August 15 of each year, beginning February 15, 2018. We used the net proceeds from the 2025 Notes, together with cash on hand, to fund the redemption of our 5.875% senior notes due 2019, or 2019 Notes.

The 2025 Notes are unsecured obligations of Diamond Offshore Drilling, Inc., and rank equally in right of payment to all of its existing and future senior indebtedness, and are structurally subordinated to all existing and future obligations of our subsidiaries. We have the right to redeem some or all of the 2025 Notes at any time or from time to time, on at least 15 days but not more than 60 days prior written notice, at the applicable redemption price specified in the governing indenture, plus accrued and unpaid interest to, but excluding, the date of redemption. The 2025 Notes contain customary covenants including limitations on liens, mergers, consolidations and certain sales of assets and on entering into sale and lease-back transactions covering a drilling rig or drillship, as specified in the governing indenture.

In August 2017, we redeemed all of our outstanding 2019 Notes for a redemption price of $543.0 million in the aggregate, including accrued and unpaid interest to the date of redemption. We accounted for the redemption as an extinguishment of debt and have reported a corresponding loss of $35.4 million in our Condensed Consolidated Statements of Operations for the three-month and nine-month periods ended September 30, 2017.

At September 30, 2017, our outstanding senior notes were comprised of the following debt issues:


	Principal									Semiannual
	Amount			Interest Rate						Interest Payment
Debt Issue	(In millions)		Maturity Date	Coupon			Effective			Dates
3.45% Senior Notes due 2023	$	250.0	November 1, 2023		3.45	%		3.50	%	May 1 and November 1
7.875% Senior Notes due 2025	$	500.0	August 15, 2025		7.875	%		8.00	%	February 15 and August 15
5.70% Senior Notes due 2039	$	500.0	October 15, 2039		5.70	%		5.75	%	April 15 and October 15
4.875% Senior Notes due 2043	$	750.0	November 1, 2043		4.875	%		4.89	%	May 1 and November 1

At September 30, 2017, the carrying value of our outstanding senior notes, net of unamortized discount and debt issuance costs, was as follows:


	September 30, 2017
	(In thousands)
3.45% Senior Notes due 2023	$	248,090
7.875% Senior Notes due 2025		489,200
5.70% Senior Notes due 2039		492,930
4.875% Senior Notes due 2043		741,632

Total senior notes, net	$	1,971,852