Debt (Tables)

9 Months Ended

Sep. 30, 2014

The Company is in compliance with all covenants under its financing arrangements. The components of the Company’s consolidated debt and capital lease obligations are as follows (in thousands):



	September 30, 2014			December 31, 2013
Encore revolving credit facility	$	429,000		$	356,000
Encore term loan facility	147,984			140,625
Encore senior secured notes	47,500			58,750
Encore convertible senior notes	448,500			287,500
Less: Debt discount	(53,461		)	(42,240		)
Propel facilities	109,660			170,630
Propel securitized notes	113,401			—
Cabot senior secured notes	1,118,628			603,272
Add: Debt premium	72,595			43,583
Cabot senior revolving credit facility	92,434			—
Preferred equity certificates	210,891			199,821
Capital lease obligations	15,274			12,219
Other	38,340			20,271
	$	2,790,746		$	1,850,431

Schedule of Convertible Notes - Interest Rates, Hedging, Liability and Equity Components

The balances of the liability and equity components of all of the Convertible Notes outstanding were as follows (in thousands):



	September 30, 2014			December 31, 2013
Liability component—principal amount	$	448,500		$	287,500
Unamortized debt discount	(53,461		)	(42,240		)
Liability component—net carrying amount	$	395,039		$	245,260
Equity component	$	54,523		$	46,954

Prior to the close of business on the business day immediately preceding their respective conversion date (listed below), holders may convert their Convertible Notes under certain circumstances set forth in the applicable Convertible Notes indentures. On or after their respective conversion dates until the close of business on the scheduled trading day immediately preceding their respective maturity date, holders may convert their Convertible Notes at any time. Certain key terms related to the convertible features for each of the Convertible Notes as of September 30, 2014 are listed below.



	2017 Convertible Notes		2020 Convertible Notes		2021 Convertible Notes
Initial conversion price	$	31.56	$	45.72	$	59.39
Closing stock price at date of issuance	$	25.66	$	33.35	$	47.51
Closing stock price date	November 27, 2012		June 24, 2013		March 5, 2014
Conversion rate (shares per $1,000 principal amount)	31.6832		21.8718		16.8386
Conversion date⁽¹⁾	May 27, 2017		January 1, 2020		September 15, 2020

_______________________


(1)	2017 Convertible Notes became convertible on January 2, 2014, as certain early conversion events were satisfied. Refer to “Conversion and EPS impact” section below for further details.

The debt and equity components, the issuance costs related to the equity component, the stated interest rate, and the effective interest rate for each of the Convertible Notes are listed below (in thousands, except percentages):



	2017 Convertible Notes			2020 Convertible Notes			2021 Convertible Notes
Debt component	$	100,298		$	140,271		$	143,604
Equity component	$	14,702		$	32,229		$	17,396
Equity issuance cost	$	788		$	1,113		$	575
Stated interest rate	3.000		%	3.000		%	2.875		%
Effective interest rate	6.000		%	6.350		%	4.700		%

The details of the hedge program for each of the Convertible Notes are listed below (in thousands, except conversion price):



	2017 Convertible Notes		2020 Convertible Notes		2021 Convertible Notes
Cost of the hedge transaction(s)	$	50,595	$	18,113	$	19,545
Initial conversion price	$	31.56	$	45.72	$	59.39
Effective conversion price	$	60.00	$	61.55	$	83.14

Cabot and Marlin Acquisitions [Member]

Debt Instrument [Line Items]

Interest Expense

Interest expense related to the Cabot Notes and Marlin Bonds was as follows (in thousands):



	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
Interest expense—stated coupon rate	$	26,239		$	12,857		$	72,099		$	12,857
Interest income—accretion of debt premium	(2,760		)	(1,367		)	(7,565		)	(1,367		)
Total interest expense—Cabot Notes and Marlin Bonds	$	23,479		$	11,490		$	64,534		$	11,490

Convertible Notes [Member]

Debt Instrument [Line Items]

Interest Expense

Interest expense related to the convertible notes was as follows (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2014		2013		2014		2013
Interest expense—stated coupon rate	$	3,316	$	2,141	$	9,080	$	3,947
Interest expense—amortization of debt discount	2,228		1,570		6,164		2,887
Total interest expense—convertible notes	$	5,544	$	3,711	$	15,244	$	6,834