NOTE 7: DEBT AND CREDIT FACILITIES

Debt

A summary of our long-term debt, including capital leases, is as follows:



	February 3, 2018			January 28, 2017
Secured
Mortgage payable, 7.68%, due April 2020		$17			$24
Other	1			3
Total secured debt	18			27
Unsecured
Net of unamortized discount:
Senior notes, 6.25%, due January 2018	—			650
Senior notes, 4.75%, due May 2020	500			499
Senior notes, 4.00%, due October 2021	500			500
Senior notes, 4.00%, due March 2027	349			—
Senior debentures, 6.95%, due March 2028	300			300
Senior notes, 7.00%, due January 2038	146			146
Senior notes, 5.00%, due January 2044	892			602
Other¹	32			50
Total unsecured debt	2,719			2,747

Total long-term debt	2,737			2,774
Less: current portion	(56		)	(11		)
Total due beyond one year		$2,681			$2,763

¹Other unsecured debt includes our Puerto Rico unsecured borrowing facility partially offset by deferred bond issue costs.

Our mortgage payable is secured by an office building that had a net book value of $56 at the end of 2017.

Required principal payments on long-term debt, excluding capital lease obligations, are as follows:



Fiscal year
2018		$56
2019	8
2020	502
2021	500
2022	—
Thereafter	1,764

During 2017, we issued $350 aggregate principal amount of 4.00% senior unsecured notes due March 2027 and $300 aggregate principal amount of 5.00% senior unsecured notes due January 2044. With the proceeds of these new notes, we retired our $650 senior unsecured notes that were due January 2018. We incurred $18 of net interest expense related to the refinancing, which included the write-off of unamortized balances associated with the debt discount, issue costs and fair value hedge adjustment resulting from the sale of our interest rate swap agreements in 2012. It also included a one-time payment of $24 to 2018 Senior Note holders under a make-whole provision, which represents the net present value of the expected coupon payments had the notes been outstanding through the original maturity date.

Interest Expense

The components of interest expense, net are as follows:



Fiscal year	2017			2016			2015
Interest on long-term debt and short-term borrowings		$168			$147			$153
Less:
Interest income	(5		)	(1		)	—
Capitalized interest	(27		)	(25		)	(28		)
Interest expense, net		$136			$121			$125

Credit Facilities

As of February 3, 2018, we had total short-term borrowing capacity of $800 under our senior unsecured revolving credit facility (“revolver”) that expires in April 2020. Under the terms of our revolver, we pay a variable rate of interest and a commitment fee based on our debt rating. The revolver is available for working capital, capital expenditures and general corporate purposes. We have the option to increase the revolving commitment by up to $200, to a total of $1,000, provided that we obtain written consent from the lenders.

The revolver requires that we maintain an adjusted debt to earnings before interest, income taxes, depreciation, amortization and rent (“EBITDAR”) leverage ratio of no more than four times. As of February 3, 2018 and January 28, 2017, we were in compliance with this covenant.

Our $800 commercial paper program allows us to use the proceeds to fund operating cash requirements. Under the terms of the commercial paper agreement, we pay a rate of interest based on, among other factors, the maturity of the issuance and market conditions. The issuance of commercial paper has the effect, while it is outstanding, of reducing available liquidity under the revolver by an amount equal to the principal amount of commercial paper.

As of February 3, 2018 and January 28, 2017, we had no issuances outstanding under our commercial paper program and no borrowings outstanding under our revolver.

Our wholly owned subsidiary in Puerto Rico maintains a $52 unsecured borrowing facility to support our expansion into that market. The facility expires in Fall 2018 and borrowings on this facility incur interest based upon the LIBOR plus 1.275% per annum and also incurred a fee based on any unused commitment. As of February 3, 2018 and January 28, 2017, we had $48 and $50 outstanding on this facility, which is included as a component in other unsecured debt and the current portion of debt.