Long-term Debt

The following table provides the Company’s debt balance, net of debt issuance costs and unamortized discounts, as of January 28, 2017 and January 30, 2016:



	January 28, 2017			January 30, 2016
	(in millions)
Senior Unsecured Debt with Subsidiary Guarantee
$1 billion, 6.875% Fixed Interest Rate Notes due November 2035 (“2035 Notes”)	$	989		$	988
$1 billion, 5.625% Fixed Interest Rate Notes due February 2022 (“2022 Notes”)	992			991
$1 billion, 6.625% Fixed Interest Rate Notes due April 2021 (“2021 Notes”)	992			990
$700 million, 6.75% Fixed Interest Rate Notes due July 2036 (“2036 Notes”)	692			—
$500 million, 5.625% Fixed Interest Rate Notes due October 2023 (“2023 Notes”)	497			496
$500 million, 8.50% Fixed Interest Rate Notes due June 2019 (“2019 Notes”) (a)	496			499
$400 million, 7.00% Fixed Interest Rate Notes due May 2020 (“2020 Notes”)	397			396
Total Senior Unsecured Debt with Subsidiary Guarantee	$	5,055		$	4,360
Senior Unsecured Debt
$350 million, 6.95% Fixed Interest Rate Debentures due March 2033 (“2033 Notes”)	$	348		$	348
$300 million, 7.60% Fixed Interest Rate Notes due July 2037 (“2037 Notes”)	297			297
$700 million, 6.90% Fixed Interest Rate Notes due July 2017 (“2017 Notes”) (b)	—			709
Foreign Facilities	36			7
Total Senior Unsecured Debt	$	681		$	1,361
Total	$	5,736		$	5,721
Current Portion of Long-term Debt	(36		)	(6		)
Total Long-term Debt, Net of Current Portion	$	5,700		$	5,715

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(a)	The balances include a fair value interest rate hedge adjustment which increased the debt balance by $2 million as of January 28, 2017 and $8 million as of January 30, 2016.


(b)	The balance includes a fair value interest rate hedge adjustment which increased the debt balance by $10 million as of January 30, 2016.

The following table provides principal payments due on outstanding debt in the next five fiscal years and the remaining years thereafter:



Fiscal Year (in millions)
2017	$	36
2018	—
2019	500
2020	400
2021	1,000
Thereafter	$	3,850

Cash paid for interest was $387 million in 2016, $317 million in 2015 and $328 million in 2014.

Issuance of Notes

In June 2016, the Company issued $700 million of 6.75% notes due in July 2036. The obligation to pay principal and interest on these notes is jointly and severally guaranteed on a full and unconditional basis by the Guarantors. The proceeds from the issuance were $692 million, which were net of issuance costs of $8 million. These issuance costs are being amortized through the maturity date of July 2036 and are included within Long-term Debt on the January 28, 2017 Consolidated Balance Sheet.

In October 2015, the Company issued $1 billion of 6.875% notes due in November 2035. The obligation to pay principal and interest on these notes is jointly and severally guaranteed on a full and unconditional basis by the Guarantors. The proceeds from the issuance were $988 million, which were net of issuance costs of $12 million. These issuance costs are being amortized through the maturity date of November 2035 and are included within Long-term Debt on the Consolidated Balance Sheets.

Repurchase of Notes

In July 2016, the Company used the proceeds from the 2036 Notes to repurchase the $700 million 2017 Notes for $742 million. The pre-tax loss on extinguishment of this debt was $36 million (after-tax net loss of $22 million), which is net of gains of $7 million related to terminated interest rate swaps associated with the 2017 Notes. This loss is included in Other Income in the 2016 Consolidated Statement of Income.

Debt Facilities

The Company maintains a secured revolving credit facility (“Revolving Facility”). The Revolving Facility has aggregate availability of $1 billion and expires July 18, 2019. The fees related to committed and unutilized amounts are 0.30% per annum, and the fees related to outstanding letters of credit are 1.50% per annum. In addition, the interest rate on outstanding U.S. dollar borrowings or British pound borrowings is LIBOR plus 1.50% per annum. The interest rate on outstanding Canadian dollar borrowings is CDOR plus 1.50% per annum.

The Revolving Facility contains fixed charge coverage and debt to EBITDA financial covenants. The Company is required to maintain a fixed charge coverage ratio of not less than 1.75 to 1.00 and a consolidated debt to consolidated EBITDA ratio not exceeding 4.00 to 1.00 for the most recent four-quarter period. In addition, the Revolving Facility provides that investments and restricted payments may be made, without limitation on amount, if (a) at the time of and after giving effect to such investment or restricted payment the ratio of consolidated debt to consolidated EBITDA for the most recent four-quarter period is less than 3.00 to 1.00 and (b) no default or event of default exists. As of January 28, 2017, the Company was in compliance with both of its financial covenants, and the ratio of consolidated debt to consolidated EBITDA was less than 3.00 to 1.00.

As of January 28, 2017, there were no borrowings outstanding under the Revolving Facility.

The Revolving Facility supports the Company’s letter of credit program. The Company had $8 million of outstanding letters of credit as of January 28, 2017 that reduce its remaining availability under the Revolving Facility.

In addition to the Revolving Facility, the Company maintains various revolving and term loan bank facilities with availability totaling $100 million to support its foreign operations. Current borrowings on these Foreign Facilities mature between February 8, 2017 and January 24, 2018. The interest rates on outstanding borrowings are based upon the applicable benchmark rate for the currency of each borrowing.

During 2016, the Company borrowed $35 million and made payments of $6 million under the Foreign Facilities. The maximum daily amount outstanding at any point in time during 2016 was $36 million.

Interest Rate Swap Arrangements

For information related to the Company’s fair value interest rate swap arrangements, see Note 13, “Derivative Financial Instruments.”