Derivatives

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

15. DERIVATIVES

We are exposed to the impact of changes in foreign currency exchange rates and interest rates in the normal course of business. Our financial risk management program is designed to manage the exposure arising from this cash flow risk and uses derivative financial instruments to minimize this risk. We do not enter into derivative financial instruments for trading or speculative purposes.

In December of 2021, we executed foreign currency exchange rate forward contracts in currency pairs for EUR, AUD, NZD versus USD. These foreign currency forward agreements related to foreign currency balance sheet exposure resulting from intercompany loans and provide economic hedges but were not designated as hedges for accounting purposes. The terms of these forward contracts are approximately one month and are expected to be settled in cash upon maturity.

In 2019, we executed interest rate swaps that were designated as cash flow hedges to manage interest rate risk on our floating rate debt. These interest rate swap contracts adjusted the amount of our total debt that is subject to variable interest rates by effectively fixing the borrowing rates on a portion of our floating rate debt discussed in Note 7 - Long-Term Debt and Other Borrowings, Net. These agreements matured on July 31, 2021.

Our interest rate swap agreements exchanged payment streams based on the notional principal amount. These agreements fixed our interest rates ranging from 1.63% to 1.70% plus the applicable margin as provided in our debt agreement on an amount of our debt principal equal to the then-outstanding swap notional amount. On the interest rate swap inception dates, we designated the swaps as a hedge of the variability in cash flows to be paid on our variable rate borrowings.

The following table discloses the notional amounts and fair value of our derivative instruments included in other current liabilities or other liabilities on our consolidated balance sheets:

	December 31, 2021				December 31, 2020
(In millions)	Notional Amount		Liability		Notional Amount		Liability
Non-Designated Hedging Instruments
Foreign currency exchange rate forward contracts	$	56	$	—	$	—	$	—
Designated Cash Flow Hedging Instruments
Interest rate swap contracts	—		—		500		5
Total contracts	$	56	$	—	$	500	$	5

The following table discloses the effect of our derivative instruments on our consolidated statements of operations:

		Years Ended
(In millions)	Location	December 31, 2021		December 31, 2020		December 31, 2019
Interest rate swap contracts	Interest (income) expense	$	5	$	5	$	1