Debt and Credit Facilities

Long-Term Debt



December 31	2016			2015
2.0% Senior Convertible Notes due 2020	$	988		$	969
3.5% senior notes due 2021	395			394
3.75% senior notes due 2022	746			745
3.5% senior notes due 2023	593			592
4.0% senior notes due 2024	588			587
6.5% debentures due 2025	117			118
7.5% debentures due 2025	345			345
6.5% debentures due 2028	36			36
6.625% senior notes due 2037	54			54
5.5% senior notes due 2044	396			396
5.22% debentures due 2097	91			90
Other long-term debt	52			29
	4,401			4,355
Adjustments for unamortized gains on interest rate swap terminations	(5		)	(6		)
Less: current portion	(4		)	(4		)
Long-term debt	$	4,392		$	4,345

On August 25, 2015, the Company entered into an agreement with Silver Lake Partners to issue $1.0 billion of 2% Senior Convertible Notes which mature in September 2020. Interest on these notes is payable semiannually. The notes are convertible anytime on or after two years from their issuance date, except in certain limited circumstances including, for example, if the volume weighted average price of the Company's stock exceeds $85 for ten consecutive trading days, then up to 20% of the notes may be transferred or converted to shares of Company stock. The notes are convertible based on a conversion rate of 14.5985 per $1,000 principal amount (which is equal to an initial conversion price of $68.50 per share). The value by which the Senior Convertible Notes exceeded their principal amount if converted as of December 31, 2016 was $202 million. In the event of conversion, the Company intends to settle the principal amount of the Senior Convertible Notes in cash.

The Company recorded a long-term debt liability associated with the Senior Convertible Notes by determining the fair value of an equivalent debt instrument without a conversion option. Using a discount rate of 2.4%, which was determined based on a review of relevant market data, the Company has calculated the debt liability to be $992 million, indicating an $8 million discount to be amortized over the expected life of the debt instrument. As of December 31, 2016, the remaining unamortized debt discount was $3 million, which will be amortized over one year as a component of interest expense compared to $7 million as of December 31, 2015. For the year ended December 31, 2016, total interest expense relating to both the contractual interest coupon and amortization of the debt discount was $24 million, compared to $8 million for the year December 31, 2015. The total of proceeds received in excess of the fair value of the debt liability of $8 million has been recorded within Additional paid-in capital.

Aggregate requirements for long-term debt maturities during the next five years are as follows: 2017—$4 million; 2018—$5 million; 2019—$5 million; 2020—$1 billion; and 2021—$400 million.

In connection with the completion of the acquisition of GDCL, the Company entered into a new term loan credit agreement (the “Term Loan Agreement”), under which the Company borrowed a term loan (the “Term Loan”) with an initial principal amount of $675 million. Interest on the Term Loan is variable and indexed to LIBOR. No additional borrowings are permitted under the Term Loan Agreement and amounts borrowed and repaid or prepaid may not be re-borrowed. The Company has repaid all amounts borrowed under the Term Loan as of December 31, 2016.

Effective January 1, 2016, the Company retrospectively adopted ASU No. 2015-03, "Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs." Under this guidance, the Company has revised the presentation of debt issuance costs which were previously capitalized in other assets in the consolidated balance sheet to be presented as a reduction to long-term debt. As of December 31, 2016 and December 31, 2015, $25 million and $41 million, respectively, have been presented as a component of long-term debt.

Credit Facilities

As of December 31, 2016, the Company had a $2.1 billion unsecured syndicated revolving credit facility, which includes a $450 million letter of credit sub-limit, (the “2014 Motorola Solutions Credit Agreement”) scheduled to mature on May 29, 2019. The Company must comply with certain customary covenants, including a maximum leverage ratio as defined in the 2014 Motorola Solutions Credit Agreement. The Company was in compliance with its financial covenants as of December 31, 2016. The Company did not borrow under the 2014 Motorola Solutions Credit Agreement during the twelve months ended December 31, 2016. No letters of credit were issued under the revolving credit facility as of December 31, 2016.