Annual report pursuant to Section 13 and 15(d)

Long-Term Debt

v3.20.1
Long-Term Debt
12 Months Ended
Feb. 01, 2020
Debt Disclosure [Abstract]  
Long-Term Debt Long-Term Debt   
($ in millions)
 
2019
 
2018
Issue:
 
 
 
 
8.125% Senior Notes Due 2019
 
$

 
$
50

5.65% Senior Notes Due 2020 (1)
 
105

 
110

2016 Term Loan Facility (Matures in 2023)
 
1,540

 
1,583

5.875% Senior Secured Notes Due 2023 (1)
 
500

 
500

7.125% Debentures Due 2023
 
10

 
10

8.625% Senior Secured Second Priority Notes Due 2025 (1)
 
400

 
400

6.9% Notes Due 2026
 
2

 
2

6.375% Senior Notes Due 2036 (1)
 
388

 
388

7.4% Debentures Due 2037
 
313

 
313

7.625% Notes Due 2097
 
500

 
500

Total debt
 
3,758

 
3,856

Unamortized debt issuance costs
 
(37
)
 
(48
)
Less: current maturities
 
(147
)
 
(92
)
Total long-term debt
 
$
3,574

 
$
3,716

Weighted-average interest rate at year end
 
6.3
%
 
6.3
%
Weighted-average maturity (in years)
 
16 years

 
 
 
(1)
These debt issuances contain a change of control provision that would obligate us, at the holders’ option, to repurchase the debt at a price of 101%. These provisions trigger if there were a beneficial ownership change of 50% or more of our common stock.

During the first quarter of 2018, JCP issued $400 million aggregate principal amount of senior secured second priority notes with a 8.625% interest rate (Senior Secured Second Priority Notes). The Senior Secured Second Priority Notes are due in 2025 and are guaranteed, jointly and severally, by the Company and certain domestic subsidiaries of JCP that guarantee the Company's 2016 Term Loan Facility (defined below) and existing Senior Secured First Priority Notes (defined below). The net proceeds from the Senior Secured Second Priority Notes were used for the tender consideration for JCP's contemporaneous cash tender offers for $125 million aggregate principal amount of its 8.125% Senior Notes Due 2019 (2019 Notes) and $250 million aggregate principal amount of its 5.65% Senior Notes Due 2020 (collectively, with the 2019 Notes, the Securities). In doing so, we recognized a loss on extinguishment of debt of $23 million which includes the premium paid over the face value of the accepted Securities of $20 million, reacquisition costs of $1 million and the write off of unamortized debt issuance costs of $2 million.

The Company's amended and restated senior secured term loan credit facility (2016 Term Loan Facility) bears interest at a rate of LIBOR (subject to a 1% floor) plus 4.25% and matures on June 23, 2023. We are required to make quarterly repayments in a principal amount equal to $10.55 million during the seven-year term, subject to certain reductions for mandatory and optional prepayments. Proceeds from the 2016 Term Loan Facility and the $500 million aggregate principal amount of 5.875% Senior Secured Notes due 2023 (Senior Secured First Priority Notes) were used to repay the entire outstanding principal balance of the $2.25 billion five-year senior secured term loan facility entered into in 2013. The 2016 Term Loan Facility and the Senior Secured First Priority Notes are guaranteed by the Company and certain subsidiaries of JCP and are secured by mortgages on certain real estate of JCP and the guarantors.

Scheduled Annual Principal Payments on Long-Term Debt, Excluding Capital Leases Financing Obligation and Note Payable
($ in millions)
 
2020
$
147

2021
42

2022
42

2023
1,924

2024

Thereafter
1,603

Total
$
3,758