Accounts Receivable Securitization

12 Months Ended

Dec. 31, 2019

Accounts Receivable Securitization [Abstract]

Accounts Receivable Securitization

9. Accounts Receivable Securitization

In October 2016, the Company entered into an accounts receivable securitization program with Wells Fargo, whereby transactions under the program were accounted for as sales of trade receivables between October 2016 and June 2018, in accordance with ASC Topic 860, Transfers and Servicing (ASC Topic 860). Sales of trade receivables under the program were recorded as a reduction of accounts receivable in the Consolidated Balance Sheet.

In June 2018, the Company amended its securitization program with Wells Fargo (Amendment). Following the Amendment, the Company no longer accounts for the sales of the trade receivables in accordance with ASC Topic 860 and instead now maintains the trade receivables and related debt on its Consolidated Balance Sheet. In connection with the Amendment, Wells Fargo’s existing ownership interest in the trade receivables was converted into undivided interests in the trade receivables to secure a loan of up to $60 million to the Company and the deferred purchase price was eliminated.

As a result of the Amendment, the Company’s trade account receivables increased by $60 million and the Company’s long-term debt increased by $60 million. This non-cash transaction did not impact the Company’s Consolidated Statement of Cash Flows during the year ended December 31, 2018.

In October 2018, the Company further amended the accounts receivable securitization program to increase the commitment size from $60 million to $70 million. In October 2019, the Company further amended the accounts receivable securitization program to reduce the commitment size from $70 million to $65 million and extended the expiration date of the program until October 2020. As of December 31, 2019 and 2018, $65 million and $70 million, respectively, was borrowed under this agreement. See Note 4, Debt, for further information.