Long Term Debt and Financing Arrangements

9 Months Ended

Sep. 30, 2016

Long Term Debt and Financing Arrangements

Long-term debt consists of the following (in millions):



	Maturity	September 30, 2016		December 31, 2015
Senior notes at 5.95%	2018	$	299.2	$	298.8
Senior notes at 3.625%	2022	297.4		297.1
Senior notes at 3.35%	2026	393.5		—
TOTAL LONG TERM DEBT ^(a)		$	990.1	$	595.9

^(a) Debt is presented net of debt issuance costs and unamortized discounts.

In March 2016, the Company completed a public debt offering of $400 million of long-term unsecured, unsubordinated notes maturing in March 2026 and bearing interest at a fixed rate of 3.35% (the "2026 Notes"). Net proceeds from the issuance were $393.4 million after deducting the discount on the notes and offering expenses paid by the Company. The 2026 Notes are fixed rate indebtedness, are callable at any time with a make whole premium and are only subject to accelerated payment prior to maturity in the event of a default (including as a result of the Company's failure to meet certain non-financial covenants) under the indenture governing the 2026 Notes, as modified by the supplemental indenture creating such notes, or upon a change in control event as defined in such indenture.

The Company was in compliance with all non-financial covenants under all Senior notes as of September 30, 2016.

As of September 30, 2016 and December 31, 2015, the estimated fair value of the long-term debt was $1,058.8 million and $630.5 million, respectively, using quoted market prices in active markets for similar liabilities (Level 2).

At December 31, 2015, the Company had $48.2 million of short-term debt outstanding which consisted primarily of commercial paper. The Company had $5.8 million of short-term debt outstanding at September 30, 2016.

On December 16, 2015, the Company entered into a five-year revolving credit agreement (the "Credit Agreement") with a syndicate of lenders that provides a $750 million committed revolving credit facility. The revolving credit facility serves as a backup to the Company's commercial paper program. The single financial covenant in the Credit Agreement, which the Company was in compliance with at September 30, 2016, requires that total debt not exceed 55% of total capitalization as of the last day of each fiscal quarter of the Company. At September 30, 2016 and December 31, 2015 the revolving credit facility had not been drawn against.