Debt

9 Months Ended

Sep. 30, 2020

Note 9—Debt

Short-term debt: On July 31, 2020, the Company paid down the remaining principal of $82.5 million on the 5-year $100 million term loan (Term Loan I) with a maturity date of May 17, 2021.

On April 9, 2020, Globe Life entered into a 364-Day Term Loan Agreement ("Term Loan II"). The Agreement provided the Company with access up to $300 million in unsecured term loans, all maturing on April 8, 2021. Globe Life borrowed the full amount on April 15, 2020 to utilize for general corporate purposes, including additional liquidity at the Parent Company. The net proceeds from the Term Loan II were $299.1 million. On August 17, 2020, the Company repaid $150 million of the Term Loan II with the remaining balance of $150 million repaid on August 26, 2020. The Company recorded a $634 thousand loss on redemption of debt from the write off of unamortized issue expenses.

Long-term debt: On August 21, 2020, Globe Life completed the issuance and sale of $350 million in aggregate principal amount of Globe Life's 2.15% unsecured Senior Notes due August 15, 2030. The net proceeds from the sale of the Senior Notes were $345.8 million.

On September 3, 2020, Globe Life completed the issuance and sale of $50 million in aggregate principal of Globe Life's 2.15% unsecured Senior Notes also due August 15, 2030. These Senior Notes were issued as additional notes under a Second Supplemental Indenture governing the 2.15% Senior Notes issued on August 21, 2020. The Senior Notes are fully fungible and have the same terms as the first issuance. The net proceeds from the sale of the Senior Notes were $49.3 million, after giving effect to the underwriting expenses.

Globe Life utilized the total net proceeds of $395 million to extinguish the Term Loan II and for general corporate purposes, which may include additional capital investments in its insurance subsidiaries and additional holding company liquidity.

Credit facility: On August 24, 2020, Globe Life entered into a new credit agreement, replacing the prior agreement that was due on May 17, 2021, which provides for a $750 million revolving credit facility that may be increased to $1.0 billion. The credit facility matures August 24, 2023 and may be extended up to two one-year periods upon the Company's request. Pursuant to this agreement, the participating lenders have agreed to make revolving loans to Globe Life and to issue secured or unsecured letters of credit. The Company has not drawn on any of the credit to date. As of September 30, 2020, the Company was in full compliance with these covenants.

The following table presents information about the terms and outstanding balances of Globe Life's debt.

Selected Information about Debt Issues


				As of
				September 30, 2020							December 31, 2019
Instrument	Issue Date	Maturity Date	Coupon Rate	Interest Payment Dates	Par Value		Book Value		Fair Value		Book Value
Senior notes	5/27/1993	5/15/2023	7.875%	semiannual	$	165,612	$	164,892	$	194,604	$	164,713
Senior notes(1)	9/24/2012	9/15/2022	3.800%	semiannual	150,000		149,331		159,212		149,089
Senior notes	9/27/2018	9/15/2028	4.550%	semiannual	550,000		544,179		655,501		543,735
Senior notes	8/21/2020	8/15/2030	2.150%	semiannual	400,000		395,091		401,152		—
Junior subordinated debentures	5/17/2016	6/15/2056	6.125%	quarterly	300,000		290,635		308,760		290,584
Junior subordinated debentures	11/17/2017	11/17/2057	5.275%	semiannual	125,000		123,378		122,935		123,367
Term loan					—		—		—		86,875
					1,690,612		1,667,506		1,842,164		1,358,363
Less current maturity of term loan					—		—		—		9,375
Total long-term debt					1,690,612		1,667,506		1,842,164		1,348,988

Current maturity of term loan					—		—		—		9,375
Commercial paper					280,000		279,758		279,758		289,363
Total short-term debt					280,000		279,758		279,758		298,738

Total debt					$	1,970,612	$	1,947,264	$	2,121,922	$	1,647,726

(1)An additional $150 million par value and book value is held by insurance subsidiaries that eliminates in consolidation.

The commercial paper has the highest priority of all the debt followed by senior notes then junior subordinated debentures. The Senior notes due 2023 are noncallable, the remaining senior notes are callable under a make-whole provision, and the junior subordinated debentures are callable upon special events.