Senior Notes, Convertible Notes and Trust Preferred Securities

12 Months Ended

Dec. 31, 2015

Senior Notes, Convertible Notes, Exchangeable Notes and Trust Preferred Securities

Mortgages and Notes Payable

The Company, through property owner subsidiaries, had outstanding mortgages and notes payable of $882,952 and $945,216 as of December 31, 2015 and 2014, respectively. Interest rates, including imputed rates on mortgages and notes payable, ranged from 2.2% to 7.8% at December 31, 2015 and the mortgages and notes payable mature between 2016 and 2028. Interest rates, including imputed rates, ranged from 2.2% to 8.5% at December 31, 2014. The weighted-average interest rate at December 31, 2015 and 2014 was approximately 4.9% and 5.2%, respectively.

In September 2015, the Company entered into a new $905,000 unsecured credit agreement with KeyBank National Association as agent, which replaced the Company's existing revolving credit facility and term loans. With lender approval, the Company can increase the size of the new facility to an aggregate $1,810,000. A summary of the significant terms are as follows:



	Prior Maturity Date	New Maturity Date	Prior Interest Rate	Current Interest Rate
$400,000 Revolving Credit Facility⁽¹⁾	02/2017	08/2019	LIBOR + 1.15%	LIBOR + 1.00%
$250,000 Term Loan⁽²⁾	02/2018	08/2020	LIBOR + 1.35%	LIBOR + 1.10%
$255,000 Term Loan⁽³⁾	01/2019	01/2021	LIBOR + 1.75%	LIBOR + 1.10%


(1)	Maturity date can be extended to August 2020 at the Company's option. The interest rate ranges from LIBOR plus 0.85% to 1.55% (previously 0.95% to 1.725%). At December 31, 2015, the unsecured revolving credit facility had $177,000 outstanding and availability of $223,000, subject to covenant compliance.


(2)	The interest rate ranges from LIBOR plus 0.90% to 1.75% (previously 1.10% to 2.10%). The Company previously entered into aggregate interest-rate swap agreements to fix the LIBOR component at a weighted-average rate of 1.09% through February 2018 on the $250,000 of outstanding LIBOR-based borrowings.


(3)	The interest rate ranges from LIBOR plus 0.90% to 1.75% (previously 1.50% to 2.25%). The Company previously entered into aggregate interest-rate swap agreements to fix the LIBOR component at a weighted-average rate of 1.42% through January 2019 on the $255,000 of outstanding LIBOR-based borrowings.

The unsecured revolving credit facility and the unsecured term loans are subject to financial covenants, which the Company was in compliance with at December 31, 2015.

Mortgages payable and secured loans are generally collateralized by real estate and the related leases. Certain mortgages payable have yield maintenance or defeasance requirements relating to any prepayments. In addition, certain mortgages are cross-collateralized and cross-defaulted.

Scheduled principal and balloon payments for mortgages, including a held for sale property, notes payable, credit facility borrowings and term loans for the next five years and thereafter are as follows:



Year ending December 31,	Total
2016	$	139,861
2017	95,505
2018	44,664
2019	283,347
2020	300,756
Thereafter	709,192
	$	1,573,325

Included in the Consolidated Statements of Operations, the Company recognized debt satisfaction gains (charges), net, excluding discontinued operations, of $4,122, $(7,016) and $(11,811) for the years ended December 31, 2015, 2014 and 2013, respectively, due to the satisfaction of mortgages and notes payable other than those disclosed elsewhere in these financial statements. In addition, the Company capitalized $6,062, $3,441 and $2,397 in interest, including discontinued operations, for the years ended 2015, 2014 and 2013, respectively.

Senior Notes, Convertible Notes and Trust Preferred Securities

The Company had the following Senior Notes outstanding as of December 31, 2015:



Issue Date	Face Amount		Interest Rate		Maturity Date	Issue Price
May 2014	$	250,000	4.40	%	June 2024	99.883	%
June 2013	250,000		4.25	%	June 2023	99.026	%
	$	500,000

Each series of the Senior Notes is unsecured and pays interest semi-annually in arrears. The Company may redeem the notes at its option at any time prior to maturity in whole or in part by paying the principal amount of the notes being redeemed plus a premium.

During 2010, the Company issued $115,000 aggregate principal amount of 6.00% Convertible Guaranteed Notes. The notes pay interest semi-annually in arrears and mature in January 2030. The holders of the notes may require the Company to repurchase their notes in January 2017, January 2020 and January 2025 for cash equal to 100% of the notes to be repurchased, plus any accrued and unpaid interest. The Company may not redeem any notes prior to January 2017, except to preserve its REIT status. As of the date of filing this Annual Report, the notes have a conversion rate of 156.5514 common shares per one thousand principal amount of the notes, representing a conversion price of approximately $6.39 per common share. The conversion rate is subject to adjustment under certain circumstances, including increases in the Company's dividend rate above a certain threshold and the issuance of stock dividends. The notes are convertible by the holders under certain circumstances for cash, common shares or a combination of cash and common shares at the Company's election. The notes are convertible prior to the close of business on the second business day immediately preceding the stated maturity date, at any time beginning in January 2029 and also upon the occurrence of specified events. During 2015, 2014 and 2013, $3,828, $12,763 and $54,905 aggregate principal amount of the notes were converted for 519,664, 1,904,542 and 7,944,673 common shares and an aggregate cash payment of $529, $233 and $3,270 plus accrued and unpaid interest, respectively. The Company recognized aggregate debt satisfaction charges of $476, $2,436 and $13,536, during 2015, 2014 and 2013, respectively, relating to the conversions.

Below is a summary of additional disclosures related to the 6.00% Convertible Guaranteed Notes.



	6.00% Convertible Guaranteed Notes
Balance Sheets:	December 31, 2015			December 31, 2014
Principal amount of debt component	$	12,400		$	16,228
Unamortized discount	(220		)	(564		)
Carrying amount of debt component	$	12,180		$	15,664
Carrying amount of equity component	$	(34,784	)	$	(33,160	)
Effective interest rate	7.8		%	8.1		%
Period through which discount is being amortized, put date	01/2017			01/2017
Aggregate if-converted value in excess of aggregate principal amount	$	2,863		$	10,432



Statements of Operations:	2015		2014		2013
6.00% Convertible Guaranteed Notes
Coupon interest	$	765	$	1,545	$	2,296
Discount amortization	228		438		658
	$	993	$	1,983	$	2,954

LCIF guarantees the obligations of the Company under the Senior Notes and the 6.00% Convertible Guaranteed Notes.

During 2007, the Company issued $200,000 original principal amount of Trust Preferred Securities. The Trust Preferred Securities, which are classified as debt, are due in 2037, were open for redemption at the Company's option commencing April 2012 and bear interest at a fixed rate of 6.804% through April 2017 and thereafter, at a variable rate of three month LIBOR plus 170 basis points through maturity. As of December 31, 2015 and 2014, there was $129,120 original principal amount of Trust Preferred Securities outstanding.

Scheduled principal payments for these debt instruments for the next five years and thereafter are as follows:



Year ending December 31,	Total
2016	$	—
2017⁽¹⁾	12,400
2018	—
2019	—
2020	—
Thereafter	629,120
	641,520
Debt discounts	(2,273		)
	$	639,247


(1)	Although the 6.00% Convertible Guaranteed Notes mature in 2030, the notes can be put to the Company in 2017.