DEBT

Short-Term Borrowings

As of December 31, 2015 and 2014, the Company’s short-term borrowings were $3.0 million and $4.1 million, respectively and consisted primarily of borrowings made by the Company’s subsidiary in Argentina. The short-term borrowings in Argentina had a weighted-average interest rate of 34.0% as of December 31, 2015. The Company intends to repay these borrowings within 12 months and has the ability to do so.

Term Loan Agreement

During the year ended December 31, 2015, the Company entered into a $1,000.0 million short-term loan agreement (the “Term Loan Agreement”) with various financial institutions, including Citibank, N.A., as Syndication Agent, and JPMorgan Chase Bank, N.A. (“JPMCB”), as Administrative Agent. The Loan Agreement was unsecured and all loans thereunder were payable at maturity in April 2016. Such borrowings were used to fund the Company’s accelerated share repurchase agreement described in Note 19. Following the offering of the 2020 Notes and the 2025 Notes, described below, the Company voluntarily paid off and terminated the Term Loan Agreement. The payoff amount of $1,000.3 million included principal, accrued and unpaid interest and a facility fee.

Five-Year Revolving Credit Facility Agreement

During the year ended December 31, 2015, the Company amended its five-year revolving credit facility agreement (the “Revolving Credit Facility”) to, among other things, change the manner of calculating the leverage ratio covenant contained in the Revolving Credit Facility.Previously, such covenant measured consolidated total debt to consolidated Earnings Before Interest, Income Taxes, Depreciation and Amortization (“EBITDA”). Pursuant to the amendment, such covenant will measure consolidated adjusted total debt to consolidated EBITDA, with adjusted total debt determined by reducing total debt by an amount equal to the lesser of (a) $500.0 million or (b) the sum of (i) 100% of the unrestricted cash and cash equivalents of the Company and its domestic consolidated subsidiaries and (ii) 65% of the unrestricted cash and cash equivalents of the Company’s foreign subsidiaries.

The Revolving Credit Facility is unsecured and repayable at maturity in June 2019, subject to annual extensions if a sufficient number of lenders agree. The maximum amount of outstanding borrowings and letters of credit permitted at any one time under the Revolving Credit Facility is $750.0 million, which may be increased from time to time up to $1,000.0 million at the Company’s request, subject to obtaining additional commitments and other customary conditions. The Revolving Credit Facility contains financial covenants, whereby the ratio of consolidated adjusted total debt to consolidated EBITDA cannot exceed 3.50 to 1.00, and the ratio of consolidated EBITDA to consolidated interest expense cannot be less than 3.00 to 1.00. The Company was in compliance with these financial covenants as of December 31, 2015.

Borrowings under the Revolving Credit Facility bear interest at a rate that is determined as a base rate plus a margin. The base rate is either (a) LIBOR for a specified interest period or (b) a floating rate based upon JPMorgan Chase Bank’s prime rate, the Federal Funds rate or LIBOR. The margin is determined by reference to the Company’s credit rating. The margin can range from 0.0% to 1.375% over the base rate. In addition, the Company incurs an annual 0.125% facility fee on the entire facility commitment of $750.0 million.

During the year ended December 31, 2015, the Company had gross borrowings and repayments of $446.0 million under the Revolving Credit Facility. Such borrowings were used to repurchase shares of the Company’s stock and for general corporate purposes, and were repaid following the issuance of the 2020 Notes and 2025 Notes, described below. As of December 31, 2015 and 2014, the Company had no borrowings under the Revolving Credit Facility and the Company had $750.0 million available at December 31, 2015 and 2014.

Long-Term Debt

As of December 31, 2015 and 2014, respectively, the components of long-term debt were as follows:



(Dollars in millions)	December 31,
Principal Value:	2015			2014
4.900% Notes due 2019	$	700.0		$	700.0
3.000% Notes due 2020	750.0			—
4.125% Notes due 2025	750.0			—
5.900% Notes due 2039	300.0			300.0
4.600% Notes due 2044	500.0			500.0
Sub-total	$	3,000.0		$	1,500.0
Adjustments to Principal Value:
Unamortized basis adjustment for settled interest rate swaps	7.0			8.8
Unamortized bond discount	(4.8		)	(4.0		)
Unamortized debt issuance costs	(21.6		)	(11.1		)
Fair-value interest rate swaps	0.4			(0.9		)
Long-term debt	$	2,981.0		$	1,492.8

Year Ended December 31, 2015

During the year ended December 31, 2015, the Company issued and sold $750.0 million of 3.0% Senior Notes due November 15, 2020 (“2020 Notes”) and $750.0 million of 4.125% Senior Notes due November 15, 2025 (“2025 Notes”) at a public offering price of 99.902% and 99.958%, respectively. The Company received net proceeds of $1,487.7 million from the sale of both the 2020 Notes and 2025 Notes, after deducting underwriters' discounts and offering costs. Interest is payable on each of the 2020 Notes and 2025 Notes on May 15 and November 15 of each year. Proceeds from the 2020 Notes and 2025 Notes were used to repay the Company’s Term Loan Agreement and borrowings under the Revolving Credit Facility.

During the year ended December 31, 2015, the Company entered into a series of fair value interest rate swaps that effectively convert the Company’s 2020 Notes from a fixed rate structure to a floating rate structure. These swaps have resulted in a fair value adjustment of $3.5 million at December 31, 2015 which reduces long-term debt and is offset by a long-term derivative liability. For the year ended December 31, 2015 the swaps reduced interest expense by $1.1 million. See Note 17 for a discussion of the fair value swaps.

Year Ended December 31, 2014

During the year ended December 31, 2014, the Company issued and sold $500.0 million of 4.60% Senior Notes due June 1, 2044 at a public offering price of 99.465% (the “2044 Notes”). Net proceeds from the sale of the 2044 Notes, after deducting underwriters' discounts and offering expenses, were $492.0 million. Interest on the 2044 Notes is payable semi-annually on June 1 and December 1 of each year. Proceeds from the 2044 Notes, together with cash on hand, were used to redeem the 2014 Notes, as described below. In addition, the Company settled a series of cash flow interest rate forward swaps into which it originally entered during the fourth quarter of 2013. These swaps mitigated interest rate exposure associated with the Company’s offering of the 2044 Notes. See Note 17 for discussion of the Company’s interest rate forward swaps.

During the year ended December 31, 2014, the Company entered into a series of fair value interest rate swaps that effectively convert the Company’s 4.90% Notes due 2019 (the “2019 Notes”) from a fixed rate structure to a floating rate structure. These swaps have resulted in a fair value adjustment of $3.9 million at December 31, 2015 to increase long-term debt, which is offset by a long-term derivative asset. For the years ended December 31, 2015 and 2014 the swaps reduced interest expense by $10.0 million and $6.0 million respectively. See Note 17 for a discussion of the fair value swaps.

During the year ended December 31, 2014, the Company redeemed all of its $500.0 million of 3.50% Notes due in 2014 (the “2014 Notes”). The redemption price, which was calculated in accordance with the terms of the 2014 Notes and included principal plus a make-whole premium, was $503.5 million.

Using quoted prices in markets that are not active, the Company determined that the fair value of its long-term debt was $3,050.2 million (Level 2) as of December 31, 2015.

Our long-term debt may be prepaid at any time, in whole or in part, at a redemption price equal to the greater of par value or an amount calculated based upon the sum of the present values of the remaining scheduled payments. Upon a change of control, we may be required to repurchase the notes for an amount equal to 101% of the then-outstanding principal amount plus accrued and unpaid interest. Interest on the notes are due semi-annually and the notes are not subject to amortization.

The components of interest expense-net were as follows:



	Years Ended December 31,
(Dollars in millions)	2015			2014			2013
Interest expense	$	74.6		$	69.9		$	59.2
Interest income	(9.6		)	(9.6		)	(8.6		)
Interest expense-net	$	65.0		$	60.3		$	50.6
Interest payments, net of amounts related to interest rate swaps	$	66.6		$	72.5		$	72.0