Short-Term Borrowings and Other Debt Obligations



(Dollars in millions)	March 31, 2018		December 31, 2017
Revolving Credit Agreement	$	25	$	—
Other Short-term Loans	4		11
Current Portion of Long-term Debt	124		137
Short-term Borrowings and Current Portion of Long-term Debt	$	153	$	148

Revolving Credit Agreement and Secured Term Loan Agreement

At March 31, 2018, we had total commitments under our revolving credit facility (the “Revolving Credit Agreement”) maturing in July of 2019 of $900 million and borrowings of $363 million under our secured term loan agreement (“the Term Loan Agreement and collectively with the Revolving Credit Agreement, the “Credit Agreements”) maturing in July of 2020. At March 31, 2018, we had $744 million available under the Credit Agreements and the following table summarizes our borrowing availability under these agreements:



(Dollars in millions)	March 31, 2018
Facilities	$	1,263
Less uses of facilities:
Revolving Credit Agreement	25
Letters of Credit	131
Secured Term Loan Principal Borrowing	363
Borrowing Availability	$	744

Loans under the Credit Agreements are subject to varying interest rates based on whether the loan is a Eurodollar or alternate base rate loan. We also incur a quarterly facility fee on the amount of the Revolving Credit Agreement. For the three months ended March 31, 2018, the interest rate for the Revolving Credit Agreement was LIBOR plus a margin rate of 2.80%. For the three months ended March 31, 2018, the interest rate for the Term Loan Agreement was LIBOR plus a margin rate of 2.30%.

Our Credit Agreements contain customary events of default, including in the event of our failure to comply with our financial covenants. We must maintain a leverage ratio of no greater than 2.5 to 1, a leverage and letters of credit ratio of no greater than 3.5 to 1, and an asset coverage ratio of at least 4.0 to 1, in each case with the terms and definitions for the ratios as provided in the Credit Agreements. At March 31, 2018, we were in compliance with these financial covenants. For additional information on our credit agreement covenants, please see “Note 12 – Short-term Borrowings and Other Debt Obligations” to the Condensed Consolidated Financial Statements contained in our Annual Report on Form 10-K for the year ended December 31, 2017.

Senior Notes and Tender Offers

In February 2018, we issued $600 million in aggregate principal amount of our 9.875% senior notes due 2025. We used part of the proceeds from our debt offering to repay in full our 6.00% senior notes due March 2018 and to fund a concurrent tender offer to purchase for cash any and all of our 9.625% senior notes due 2019. We settled the tender offer in cash for the amount of $475 million, retiring an aggregate face value of $425 million and accrued interest of $20 million. In April 2018, we repaid the remaining principal outstanding on an early redemption of the bond. We recognized a cumulative loss of $34 million on these transactions in “Bond Tender and Call Premium” on the accompanying Condensed Consolidated Statements of Operations.

Other Borrowings and Debt Activity

We have short-term borrowings with various domestic and international institutions pursuant to uncommitted credit facilities. At March 31, 2018, we had $4 million in short-term borrowings under these arrangements. In addition, we had $356 million of letters of credit under various uncommitted facilities and $131 million of letters of credit under the Revolving Credit Agreement. At March 31, 2018, we have cash collateralized $89 million of our letters of credit, which is included “Cash and Cash Equivalents” in the accompanying Condensed Consolidated Balance Sheets. We have $15 million of surety bonds, primarily performance bonds, issued by financial sureties against an indemnification from us at March 31, 2018.