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Interest Rate Risk.
−Removed: At June 30, 2021, we had interest rate swap agreements to fix the interest rate on $1.7 billion of variable rate LIBOR-based debt.
+Added: At September 30, 2021, we had interest rate swap agreements to fix the interest rate on $1.7 billion of variable rate LIBOR-based debt.
See Note 16 to our unaudited condensed consolidated financial statements for additional information.
1 unchanged sentence
Changes in the variable interest rates to be paid or received pursuant to the terms of the interest rate swap agreements will have a corresponding effect on future cash flows.
−Removed: Certain of our borrowings, primarily borrowings under our Senior Credit Facilities, certain production loans and our Production Tax Credit Facility, are, and are expected to continue to be, at variable rates of interest and expose us to interest rate risk.
+Added: Certain of our borrowings, primarily borrowings under our Senior Credit Facilities, certain production and related loans, our Production Tax Credit Facility and our IP Credit Facility, are, and are expected to continue to be, at variable rates of interest and expose us to interest rate risk.
If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income would decrease.
1 unchanged sentence
The applicable margin with respect to loans under our Term Loan B is a percentage per annum equal to a LIBOR rate plus 2.25%.
−Removed: Assuming the revolving credit facility is drawn up to its maximum borrowing capacity of $1.5 billion, based on the applicable LIBOR in effect as of June 30, 2021, each quarter point change in interest rates would result in a $3.4 million change in annual net interest expense on the revolving credit facility, Term Loan A, Term Loan B and interest rate swap agreements.
−Removed: The variable interest production loans incur interest at rates ranging from approximately 2.22% to 2.66%, including applicable margins ranging from 1.75% over the one, two, or three-month LIBOR to 2.25% over the one, two, or three-month LIBOR.
−Removed: A quarter point increase of the interest rates on the outstanding principal amount of our variable rate production loans would result in $1.2 million in additional costs capitalized to the respective film or television asset.
+Added: Assuming the revolving credit facility is drawn up to its maximum borrowing capacity of $1.5 billion at September 30, 2021, based on the applicable LIBOR in effect as of September 30, 2021, each quarter point change in interest rates would result in a $3.2 million change in annual net interest expense on the revolving credit facility, Term Loan A, Term Loan B and interest rate swap agreements.
+Added: The variable interest individual production and related loans incur interest at rates ranging from approximately 1.93% to 3.11%, including applicable margins ranging from 1.75% over the one, two, or three-month LIBOR to 2.875% over the twelve-month LIBOR.
+Added: A quarter point increase of the interest rates on the outstanding principal amount of our variable rate individual production and related loans would result in $1.7 million in additional costs capitalized to the respective film or television asset.
The applicable margin with respect to advances under the Production Tax Credit Facility is a percentage per annum equal to a LIBOR rate plus 1.50%.
−Removed: Assuming the Production Tax Credit Facility is utilized up to its maximum capacity of $220.0 million, based on the applicable LIBOR in effect as of June 30, 2021, each quarter point change in interest rates would result in a $0.6 million change in annual net interest expense on the Production Tax Credit Facility.
−Removed: At June 30, 2021, our 5.500% Senior Notes had an outstanding carrying value of $963.1 million, and an estimated fair value of $1,052.5 million.
+Added: Assuming the Production Tax Credit Facility is utilized up to its maximum capacity of $220.0 million, based on the applicable LIBOR in effect as of September 30, 2021, each quarter point change in interest rates would result in a $0.5 million change in annual net interest expense on the Production Tax Credit Facility.
+Added: The applicable margin with respect to advances under the IP Credit Facility is a percentage per annum equal to a LIBOR rate plus 2.25%.
+Added: Assuming the IP Credit Facility is utilized up to its maximum capacity of $140.0 million, based on the applicable LIBOR in effect as of September 30, 2021, each quarter point change in interest rates would result in a $0.4 million change in annual net interest expense on the IP Credit Facility.
+Added: At September 30, 2021, our 5.500% Senior Notes had an outstanding carrying value of $963.8 million, and an estimated fair value of $1,027.5 million.
A 1% increase in the level of interest rates would decrease the fair value of the 5.500% Senior Notes by approximately $46.6 million, and a 1% decrease in the level of interest rates would increase the fair value of the 5.500% Senior Notes by approximately $37.6 million.
The following table presents information about our financial instruments that are sensitive to changes in interest rates.
−Removed: The table also presents the cash flows of the principal amounts of the financial instruments, or the cash flows associated with the notional amounts of interest rate derivative instruments, and related weighted-average interest rates by expected maturity or required principal payment dates and the fair value of the instrument as of June 30, 2021:
−Removed: Nine Months Ending March 31, Year Ending March 31, Fair Value
−Removed: 2022 2023 2024 2025 2026 Thereafter Total June 30,
+Added: The table also presents the cash flows of the principal amounts of the financial instruments, or the cash flows associated with the notional amounts of interest rate derivative instruments, and related weighted-average interest rates by expected maturity or required principal payment dates and the fair value of the instrument as of September 30, 2021:
+Added: Six Months Ending March 31, Year Ending March 31, Fair Value
+Added: 2022 2023 2024 2025 2026 Thereafter Total September 30,
(Amounts in millions)
−Removed: Debt, Production Loans and Production Tax Credit Facility
Variable Rates:
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Average Interest Rate 2.33 % 2.33 % 2.33 % 2.33 % — —
−Removed: Production loans 141.4 300.2 33.0 — — — 474.6 474.6
+Added: Production and related loans (2)
+Added: 136.2 467.2 62.8 205.8 — — 872.0 872.0
Average Interest Rate 2.12 % 2.41 % 2.31 % 1.58 % — —
−Removed: Production tax credit facility (2)
+Added: IP Credit Facility and other financing obligations (3)
90.0 11.1 26.3 26.3 26.3 35.0 215.0 215.0
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(1) The effective interest rate in the table above is before the impact of interest rate swaps.
−Removed: (2) The repayment amount for the Production Tax Credit Facility represents the amount outstanding at June 30, 2021, and the repayment date represents the maturity date of the Production Tax Credit Facility (January 27, 2025), however net advances and payments under the Production Tax Credit Facility can fluctuate depending on the amount of collateral available.
+Added: (2) Production and related loans include individual loans for the production of film and television programs that the Company produces or licenses and the Company's Production Tax Credit Facility.
+Added: Production Tax Credit Facility amounts represent outstanding amounts under our Production Tax Credit Facility at September 30, 2021, and the repayment date represents the maturity date of the Production Tax Credit Facility (January 27, 2025), however net advances and payments under the Production Tax Credit Facility can fluctuate depending on the amount of collateral available.
+Added: (3) IP Credit Facility amounts represent outstanding amounts under our IP Credit Facility at September 30, 2021, and repayment dates are based on the projected future cash flows generated from the exploitation of the rights, subject to a minimum guaranteed payment amount, as applicable.
+Added: Other financing obligations include other financing collateralized by certain contractual payments to be received in the future.
(4) Represents interest rate swap agreements on certain of our LIBOR-based floating-rate debt with fixed rates paid ranging from 1.840% to 2.915% with maturities beginning in March 2025 through March 2030.
1 unchanged sentence
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.