Financing | 5. FINANCING March 31, 2017 December 31, 2016 5.00% senior notes due March 2027 $ 750,000 $ — 6.00% senior notes due June 2025 1,500,000 1,500,000 5.50% senior notes due June 2024 650,000 650,000 5.00% senior notes due June 2021 650,000 650,000 4.375% senior secured notes due June 2020 — 500,000 Senior secured term loan due December 2022 1,096,250 1,234,375 Senior secured term loan due January 2018 — 111,875 Senior secured revolving credit facility expires May 2020 — — Total principal amount of debt $ 4,646,250 $ 4,646,250 Less: Original issue discount, net of amortization (4,756 ) (5,857 ) Less: Debt issuance costs, net of amortization (74,076 ) (78,383 ) Less: Current portion — (12,500 ) Total long-term debt $ 4,567,418 $ 4,549,510 See Note 6 in the Notes to Consolidated Financial Statements in the 2016 Annual Report for additional information on the terms and conditions of the 6.00% senior notes (the 2025 Notes), the 5.50% senior notes (the 2024 Notes), the 5.00% senior notes (the 2021 Notes), the 4.375% senior secured notes (the 2020 Notes) and the senior secured term loans and credit facility. 5.00% Senior Notes Due 2027 In March 2017, CommScope Technologies LLC (CommScope Technologies), a wholly owned subsidiary of the Company, issued $750.0 million of 5.00% Senior Notes due March 15, 2027 (the 2027 Notes). Interest is payable on the 2027 Notes semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2017. The Company used the proceeds of the issuance of the 2027 Notes, together with cash on hand, to (i) redeem all of the 2020 Notes, (ii) repay a portion of the outstanding borrowings under its senior secured term loans, including all $111.9 million of outstanding principal on the senior secured term loan due 2018 and $138.1 million of outstanding principal on the senior secured term loan due 2022, and (iii) pay related fees and expenses. The redemption of the 2020 Notes resulted in a $14.8 million charge which is reflected in other income (expense), net. In connection with the redemption of the 2020 Notes and prepayments of the senior secured term loans, $9.6 million of debt issuance costs and original issue discount were written off and included in interest expense. CommScope, Inc., a wholly owned subsidiary of the Company, and each of CommScope, Inc.’s existing and future domestic subsidiaries (other than CommScope Technologies) that guarantee the senior secured credit facilities also guarantees the 2027 Notes on a senior unsecured basis, subject to certain exceptions. The 2027 Notes rank senior in right of payment with all of CommScope Technologies’ and the guarantors’ future subordinated indebtedness and equally in right of payment with all of CommScope Technologies’ and the guarantors’ existing and future senior indebtedness, including the senior secured credit facilities, the 2025 Notes, the 2024 Notes and the 2021 Notes. The 2027 Notes and guarantees are effectively junior to all of CommScope Technologies’ and the guarantors’ existing and future secured indebtedness, including the senior secured credit facilities, to the extent of the value of the assets securing such secured indebtedness. In addition, the 2027 Notes are structurally subordinated to all existing and future liabilities (including trade payables) of CommScope, Inc.’s subsidiaries that do not guarantee the 2027 Notes, including indebtedness incurred by certain of CommScope, Inc.’s non-U.S. subsidiaries under the revolving credit facility. The 2027 Notes may be redeemed prior to maturity under certain circumstances. Upon certain change of control events, the 2027 Notes may be redeemed at the option of the holders at 101% of their principal amount, plus accrued and unpaid interest. The 2027 Notes may be redeemed on or after March 15, 2022 at the redemption prices specified in the indenture governing the 2027 Notes. Prior to March 15, 2022, the 2027 Notes may be redeemed at a redemption price equal to 100% of the aggregate principal amount of the 2027 Notes to be redeemed, plus a make-whole premium (as specified in the indenture governing the 2027 Notes), plus accrued and unpaid interest. At any time prior to March 15, 2020, CommScope Technologies may also redeem up to 40% of the aggregate principal amount of the 2027 Notes at a redemption price of 105%, plus accrued and unpaid interest, using the proceeds of certain equity offerings. In connection with issuing the 2027 Notes, the Company paid $6.1 million of debt issuance costs during the three months ended March 31, 2017, which was recorded as a reduction of the carrying amount of the debt and is being amortized over the term of the notes. Senior Secured Credit Facilities No portion of the senior secured term loan was reflected as a current portion of long-term debt as of March 31, 2017 related to the potentially required excess cash flow payment because the amount that may be payable in 2018, if any, cannot currently be reliably estimated. There was no excess cash flow payment required in 2017 related to 2016. During the three months ended March 31, 2017, the Company did not borrow under its revolving credit facility. As of March 31, 2017, the Company had availability of approximately $409.4 million under the asset-based revolving credit facility, after giving effect to borrowing base limitations and outstanding letters of credit. Other Matters The following table summarizes scheduled maturities of long-term debt as of March 31, 2017 (in millions): Remainder of 2017 2018 2019 2020 2021 Thereafter Scheduled maturities of long-term debt $ — $ — $ — $ — $ 650.0 $ 3,996.3 The Company’s non-guarantor subsidiaries held $2,641 million, or 37%, of total assets and $603 million, or 11%, of total liabilities as of March 31, 2017 and accounted for $440 million, or 39%, of net sales for the three months ended March 31, 2017. As of December 31, 2016, the non-guarantor subsidiaries held $2,211 million, or 31%, of total assets and $615 million, or 11%, of total liabilities. For the three months ended March 31, 2016, the non-guarantor subsidiaries accounted for approximately $500 million, or 44%, of net sales. All amounts presented exclude intercompany balances. The weighted average effective interest rate on outstanding borrowings, including the amortization of debt issuance costs and original issue discount, was 5.39% and 5.24% at March 31, 2017 and December 31, 2016, respectively. |