Annual report pursuant to Section 13 and 15(d)

Long-Term Debt

v2.4.0.6
Long-Term Debt
 12 Months Ended
Dec. 31, 2012
Long-term Debt, Unclassified [Abstract]  
Long-Term Debt
Debt
Debt is summarized as follows:
 
Outstanding Principal December 31, 2012
 
Carrying value
 
December 31,
2012
 
December 31,
2011
 
amounts in millions
Bank Facility (Repaid in 2012)
—

 
—

 
750

Starz 5.00% Senior Notes due 2019
500

 
500

 
—

Starz Bank Facility
5

 
5

 
505

Other subsidiary debt
35

 
35

 
40

Total debt
$
540

 
540

 
1,295

Less current maturities
 

 
(4
)
 
(754
)
Total long-term debt
 

 
$
536

 
541


Starz 5.00% Senior Notes due 2019
In September 2012, Starz, LLC, a wholly owned subsidiary, issued $500 million aggregate principal amount of 5.00% Senior Notes due September 15, 2019 at par. Proceeds from the notes were used to repay the term loan associated with the Starz Bank Facility.
Starz Bank Facility
In November 2011, Starz, LLC entered into a Credit Agreement that provides for a $1 billion revolving credit facility, with a $50 million sub-limit for standby letters of credit, and $500 million of term loans. Starz may elect that the loans bear interest at a rate per annum equal to the Alternative Base Rate (as defined in the Credit Agreement) plus a margin of 0.5% to 1.5% or the LIBO Rate (as defined in the Credit Agreement) plus a margin of 1.5% to 2.5%, depending on Starz's Consolidated Leverage Ratio (as defined in the Credit Agreement). Each loan may be prepaid at any time and from time to time without penalty other than customary breakage costs. No mandatory prepayments will be required other than prepayment of the term loans with the net cash proceeds from any issuance or incurrence of notes or term loans intended primarily for issuance to institutional investors, other than incremental term loans. Any amounts prepaid on the revolving facility may be reborrowed. As discussed above the term loan was repaid in conjunction with issuance of the Starz 5.00% Senior Notes due 2019.

The payment and performance of Starz's obligations under the Credit Agreement are guaranteed by each Material Domestic Subsidiary (as defined in the Credit Agreement) of Starz. In addition, pursuant to Pledge Agreements, the obligations under the Credit Agreement are secured by a pledge of all of Starz's equity interests held directly or indirectly by the Company and a pledge of all equity interests of each Material Domestic Subsidiary held directly or indirectly by Starz. The Credit Agreement provides for release of the pledges if Starz's Consolidated Leverage Ratio is less than 1.50 to 1.00 for two consecutive fiscal quarters.

The Credit Agreement contains certain affirmative and negative covenants, including certain restrictions with respect to liens, mergers, sales of assets, transactions with affiliates, indebtedness, dividends and investments and limitations on Starz's Consolidated Leverage Ratio and Consolidated Interest Coverage Ratio, each as defined in the Credit Agreement. As of December 31, 2012 Starz is in compliance with all of its debt covenants. As of December 31, 2012, Starz had approximately $995 million available under the credit facility.
Subsidiary Debt
Subsidiary debt at December 31, 2012 is comprised of capitalized satellite transponder lease obligations.
Five Year Maturities
The annual principal maturities of Liberty's debt for each of the next five years is as follows (amounts in millions):
2013
$
4

2014
$
4

2015
$
5

2016
$
10

2017
$
5


Fair Value of Debt
At December 31, 2012 the fair value of the Starz 5.00% Senior Notes was $518 million. Due to its variable rate nature, the Company believes that the carrying amount of its other debt approximated fair value at December 31, 2012.