Long-Term Debt and Financing Arrangements

3 Months Ended

Mar. 31, 2016

Long-Term Debt and Financing Arrangements

Our financing arrangements are primarily provided by a committed senior secured financing arrangement with a syndicate of banks and other financial institutions. The arrangement is secured by substantially all our domestic assets and pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries, as well as guarantees by our material domestic subsidiaries.

As of March 31, 2016, the senior credit facility provides us with a total revolving credit facility size of $1,200 million and had a $281 million balance outstanding under the Tranche A Term Facility, both of which will mature on December 8, 2019. Net carrying amount for the balance outstanding under the Tranche A Term Facility including a $2 million debt issuance cost was $279 million as of March 31, 2016. Funds may be borrowed, repaid and re-borrowed under the revolving credit facility without premium or penalty (subject to any customary LIBOR breakage fees). The revolving credit facility is reflected as debt on our balance sheet only if we borrow money under this facility or if we use the facility to make payments for letters of credit. Outstanding letters of credit reduce our availability to borrow revolving loans under the facility. We are required to make quarterly principal payments under the Tranche A Term Facility of $3.75 million through December 31, 2016, $5.625 million beginning March 31, 2017 through December 31, 2017, $7.5 million beginning March 31, 2018 through September 30, 2019 and a final payment of $195 million is due on December 8, 2019. We have excluded the required payments, within the next twelve months, under the Tranche A Term Facility totaling $17 million from current liabilities as of March 31, 2016, because we have the intent and ability to refinance the obligations on a long-term basis by using our revolving credit facility.

The financial ratios required under the amended and restated senior credit facility, and the actual ratios we achieved for the first quarter of 2016, are as follows:



	Quarter Ended
	March 31, 2016
	Required	Actual
Leverage Ratio (maximum)	3.50	1.54
Interest Coverage Ratio (minimum)	2.75	13.90

The senior credit facility includes a maximum leverage ratio covenant of 3.50 and a minimum interest coverage ratio of 2.75, in each case through December 8, 2019.

At March 31, 2016, of the $1,200 million available under the revolving credit facility, we had unused borrowing capacity of $912 million with $288 million in outstanding borrowings and zero in outstanding letters of credit. As of March 31, 2016, our outstanding debt also included (i) $281 million of a term loan which consisted of a $279 million net carrying amount including a $2 million debt issuance cost related to our Tranche A Term Facility which is subject to quarterly principal payments as described above through December 8, 2019, (ii) $225 million of notes which consisted of a $221 million net carrying amount including a $4 million debt issuance cost of 5³/8 percent senior notes due December 15, 2024, (iii) $500 million of notes which consisted of a $494 million net carrying amount including a $6 million debt issuance cost of 6⁷/8 percent senior notes due December 15, 2020, and (iv) $126 million of other debt.