Borrowings



	As of December 31,
(in millions)	2015			2014
Short-term borrowings:
Foreign lines of credit and other arrangements	$	43		$	68
Senior secured revolving credit facility	—			10
Total Short-term borrowings	43			78

Current portion of long-term borrowings:
8.75% Senior secured second lien notes due 2022 (a)	750			—
4.95% Unsecured notes due 2015	—			10
Unamortized discount and unamortized deferred financing costs (b)	(10		)	—
Capital lease obligations	73			73
Total Current portion of long-term borrowings	813			83
Total Short-term and current portion of long-term borrowings	856			161

Long-term borrowings:
Senior secured term loan facility due March 2017 at LIBOR and euro LIBOR plus 3.5% or, solely with respect to U.S. dollar-denominated term loans, a base rate plus 2.5%	—			1,461
Senior secured term loan facility due March 2018 at LIBOR and euro LIBOR plus 3.5% or, solely with respect to U.S. dollar-denominated term loans, a base rate plus 2.5%	4,938			4,977
Senior secured term loan facility due September 2018 at LIBOR plus 3.5% or a base rate plus 2.5%	1,008			1,008
Senior secured term loan facility due March 2021 at LIBOR and euro LIBOR plus 4.0% or, solely with respect to U.S. dollar-denominated term loans, a base rate plus 3.0%	1,171			1,191
Senior secured term loan facility due July 2022 at LIBOR and euro LIBOR plus 3.75% or, solely with respect to U.S. dollar-denominated term loans, a base rate plus 2.75%	2,464			—
7.375% Senior secured first lien notes due 2019	—			1,595
8.875% Senior secured first lien notes due 2020	—			510
6.75% Senior secured first lien notes due 2020	1,398			1,398
5.375% Senior secured first lien notes due 2023	1,210			—
5.0% Senior secured first lien notes due 2024	1,000			—
8.25% Senior secured second lien notes due 2021	—			2,000
8.75% Senior secured second lien notes due 2022	—			1,000
5.75% Senior secured second lien notes due 2024	2,200			—
12.625% Senior unsecured notes due 2021	—			3,000
10.625% Senior unsecured notes due 2021	—			530
11.25% Senior unsecured notes due 2021	—			510
7.0% Senior unsecured notes due 2023	3,400			—
11.75% Senior unsecured subordinated notes due 2021	—			1,609
Unamortized discount and unamortized deferred financing costs (b) (c)	(174		)	(226		)
Capital lease obligations	122			134
Total Long-term borrowings	18,737			20,697
Total Borrowings (d) (e)	$	19,593		$	20,858


(a)	On November 16, 2015, the Company exercised its option to call for early redemption of its outstanding 8.75% Senior secured second lien notes due 2022. The notes were subsequently redeemed on January 15, 2016. Refer to "8.25% and 8.75% Senior Secured Second Lien Notes" below for additional information.

(b)

Unamortized deferred financing costs are amortized on a straight-line basis, which approximates the interest method, over the remaining term of the respective debt. In addition, certain lenders fees associated with debt transactions were capitalized as discounts and are similarly being amortized on a straight-line basis, which approximates the effective interest method, over the remaining term of the respective debt.

(c)

Unamortized deferred financing costs include $62 million as of December 31, 2014 that was previously recorded as an asset within "Other long-term assets" on the Company's consolidated balance sheets. Refer to note 1 "Summary of Significant Accounting Policies " of these consolidated financial statements for additional information on the change in accounting principle based upon the adoption of new accounting guidance.


(d)	As of December 31, 2015 and 2014, the fair value of the Company's long-term borrowings was $19.6 billion and $22.1 billion, respectively. The estimated fair value of the Company's long-term borrowings was primarily based on market trading prices and is considered to be a Level 2 measurement.


(e)	The effective interest rate is not substantially different than the coupon rate on any of the Company's debt tranches

Foreign Lines of Credit and Other Arrangements

As of December 31, 2015 and 2014, the Company had approximately $245 million and $349 million, respectively, available under short-term lines of credit and other arrangements with foreign banks and alliance partners primarily to fund settlement activity. As of December 31, 2015 and 2014, the Company had a $75 million and $150 million, respectively, committed line of credit for one of its U.S. alliances and the remainder of these arrangements is primarily associated with international operations and are in various functional currencies, the most significant of which are the Australian dollar, the Polish zloty, and the euro. Of the amounts outstanding as of December 31, 2015 and 2014, $17 million and $67 million were uncommitted. The weighted average interest rate associated with foreign lines of credit was 2.6% and 3.2% for the years ended December 31, 2015 and 2014, respectively. Commitment fees for the committed foreign lines of credit range from 0.16% to 0.8%.

Senior Secured Revolving Credit Facility

On June 2, 2015, the Company terminated and replaced its previous $1.0 billion senior secured revolving credit facility maturing September 24, 2016 with a new $1.25 billion senior secured revolving credit facility maturing on June 2, 2020 subject to certain earlier springing maturity provisions in certain circumstances. Up to $250 million of the new senior secured revolving credit facility is available for letters of credit of which $42 million and $43 million of letters of credit were issued under these facilities as of December 31, 2015 and 2014, respectively. As of December 31, 2015, $1.2 billion remained available.

Interest on the new senior secured revolving credit facility is payable at a rate equal to, at Company’s option, either (a) LIBOR for deposits in the applicable currency plus 350 basis points or (b) solely with respect to revolving loans denominated in U.S. dollars, a base rate plus 250 basis points. The weighted-average interest rate on these facilities was 4.60% and 5.14% for the years ended December 31, 2015 and 2014, respectively. The commitment fee rate for the unused portion of the new facility is 0.50% per year, though it may be reduced by the Company's leverage ratio.

Senior Secured Term Loan Facility

The Company has amounts outstanding under its senior secured term loan facility under separate tranches as described below. A portion of each tranche is denominated in euro with the exception of the September 2018 term loan. Interest is payable based upon LIBOR or euro LIBOR plus an applicable margin.

As of December 31, 2015, the Company held interest rate swaps to mitigate exposure to variability in interest payments on the outstanding variable rate senior secured term loan. Refer to note 13 "Derivative Financial Instruments" of these consolidated financial statements for a discussion of the Company’s derivatives.

The original terms of the Company’s senior secured term loan facility required the Company to pay equal quarterly installments in aggregate annual amounts equal to 1% of the original principal amount. However, in conjunction with debt modifications and amendments over the last several years, proceeds from the issuance of the notes were used to prepay portions of the principal balances of the Company’s senior secured term loans which satisfied the future quarterly principal payments. Therefore, the Company made no scheduled principal payments during 2015 or 2014.

The senior secured term loan facility also requires mandatory prepayments based on a percentage of excess cash flow generated by the Company. All obligations under the senior secured loan facility are fully and unconditionally guaranteed by most of the domestic, wholly owned material subsidiaries of the Company, subject to certain exceptions.

On January 1, 2016, the Company designated the euro-denominated portions of the Senior secured term loan facility due March 2018, Senior secured term loan facility due March 2021, and the July 2015 issuance of the Senior secured term loan facility due July 2022 as non-derivative hedges of net investments in foreign operations. As such, foreign currency gains and losses on the euro-denominated portions of these terms loans will be recorded within Foreign currency translation adjustment on the Company's consolidated statements of comprehensive income (loss) to the extent the hedges are effective. Foreign currency gains and losses on the euro-denominated portions of these term loans were previously recorded within Other income (expense) on the Company's consolidated statements of operations.

Senior Secured Term Loan Facility Due March 2017

The Company used the proceeds from the amendment of the Senior secured term loan facility due July 2022 in November 2015, discussed below, to redeem its outstanding Senior secured term loan facility due March 2017. Associated with the redemption, the Company incurred $5 million in loss on debt extinguishment.

Senior Secured Term Loan Facility Due July 2022

On July 10, 2015, the Company entered into an amendment of its senior secured credit facilities providing for $725 million in U.S. dollar-denominated term loans and €250 million in euro-denominated term loans maturing in July 2022 (July 2022 Term Loan).

The proceeds from the July 10, 2015 issuance of the July 2022 Term Loan were used to redeem $955 million of the Company's 7.375% senior secured first lien notes due 2019 and to pay related fees and expenses.

On November 24, 2015, the Company entered into an amendment of its senior secured credit facilities providing for an additional $1.3 billion in U.S. dollar-denominated term loans and €200 million in euro-denominated term loans maturing in July 2022 (Additional July 2022 Term Loan).

The euro-denominated portion of the Additional July 2022 Term Loan was designated by the Company as a non-derivative hedge of net investments in foreign operations. As such, foreign currency gains and losses on the euro-denominated portion of the Additional July 2022 Term Loan are recorded within Foreign currency translation adjustment on the Company's consolidated statements of comprehensive income (loss) to the extent the hedge is effective.

The proceeds from the issuance of the Additional July 2022 Term Loan were used to redeem the Company's outstanding Senior secured term loan facility due March 2017 and to pay related fees and expenses.

7.375% Senior Secured First Lien Notes

The Company used proceeds from the issuance of the July 2022 Term Loan, discussed above, to redeem $955 million of the Company's outstanding 7.375% senior secured first lien notes. Associated with the redemption, the Company incurred $45 million in loss on debt extinguishment.

The Company used proceeds from the issuance of its 5.375% senior secured first lien notes due 2023, discussed below, to redeem the remaining outstanding 7.375% senior secured first lien notes. Associated with the redemption, the Company incurred $31 million in loss on debt extinguishment.

8.875% Senior Secured First Lien Notes

The Company used proceeds from the issuance of its 5.375% senior secured first lien notes due 2023, discussed below, to redeem all outstanding 8.875% senior secured first lien notes. Associated with the redemption, the Company incurred $32 million in loss on debt extinguishment.

5.375% Senior Secured First Lien Notes

On August 11, 2015, the Company issued approximately $1.2 billion aggregate principal amount of 5.375% senior secured first lien notes due August 15, 2023. Interest on the notes will be payable semi-annually in cash on February 15 and August 15 of each year, commencing on February 15, 2016. The Company used the proceeds from the offering to redeem and repurchase all outstanding 7.375% senior secured first lien notes due 2019 and 8.875% senior secured first lien notes due 2020 and pay related fees and expenses.

The Company may redeem the notes, in whole or in part, prior to August 15, 2018 at a price equal to 100% of the notes redeemed plus accrued and unpaid interest to the redemption date and a "make-whole premium". Thereafter, the Company may redeem the notes, in whole or in part, at established redemption prices.

5.0% Senior Secured First Lien Notes

On November 25, 2015, the Company issued $1.0 billion aggregate principal amount of 5.0% senior secured first lien notes due January 15, 2024. Interest on the notes will be payable semi-annually in cash on January 15 and July 15 of each year, commencing on July 15, 2016. The Company used the proceeds from the offering together with proceeds from the November 25, 2015 offering of its 5.75% senior secured second lien notes to redeem $250 million of its outstanding 8.75% senior secured second lien notes due 2022 and all outstanding 8.25% second lien notes due 2021 and pay related fees and expenses.

The Company may redeem the notes, in whole or in part, prior to January 15, 2019 at a price equal to 100% of the notes redeemed plus accrued and unpaid interest to the redemption date and a "make-whole premium". Thereafter, the Company may redeem the notes, in whole or in part, at established redemption prices.

8.25% and 8.75% Senior Secured Second Lien Notes

The Company used proceeds from the issuance of its 5.0% senior secured first lien notes due 2024, discussed above, and 5.75% senior secured second lien notes due 2024, discussed below, to redeem all outstanding 8.25% second lien notes and $250 million of the Company's 8.75% senior secured second lien notes. Associated with the redemption, the Company incurred $138 million in loss on debt extinguishment.

On January 15, 2016, the Company redeemed its remaining outstanding 8.75% senior secured second lien notes. Associated with the redemption, the Company incurred $43 million in loss on debt extinguishment.

5.75% Senior Secured Second Lien Notes

On November 25, 2015, the Company issued $2.2 billion aggregate principal amount of 5.75% senior secured second lien notes due January 15, 2024. Interest on the notes will be payable semi-annually in cash on January 15 and July 15 of each year, commencing on July 15, 2016. The Company used the proceeds from the offering together with proceeds from the November 25, 2015 offering of its 5.0% senior secured first lien notes to redeem $250 million of its outstanding 8.75% senior secured second lien notes due 2022 and all outstanding 8.25% second lien notes due 2021 and pay related fees and expenses.

12.625% Senior Unsecured Notes

The Company used proceeds from its initial public offering and proceeds from the issuance of its 7.0% senior unsecured notes due 2023, discussed below, to redeem all outstanding 12.625% senior unsecured notes. Associated with the redemption, the Company incurred $466 million in loss on debt extinguishment.

10.625% Senior Unsecured Notes Due 2021

The Company used proceeds from the issuance of its 7.0% senior secured first lien notes due 2023, discussed below, to redeem all outstanding 10.625% senior unsecured notes due 2021. Associated with the redemption, the Company incurred $62 million in loss on debt extinguishment.

11.25% Senior Unsecured Notes Due 2021

The Company used proceeds from its initial public offering to redeem all outstanding 11.25% senior unsecured notes due 2021. Associated with the redemption, the Company incurred $62 million in loss on debt extinguishment.

7.0% Senior Unsecured Notes Due 2023

On November 18, 2015, the Company issued $3.4 billion aggregate principal amount of 7.0% senior unsecured notes due December 1, 2023. Interest on the notes will be payable semi-annually in cash on June 1 and December 1 of each year, commencing on June 1, 2016. The Company used the proceeds from the offering to redeem its outstanding 12.625% senior unsecured notes due 2021, 10.625% senior unsecured notes due 2021, and 11.75% senior subordinated notes due 2021 and pay related fees and expenses.

The Company may redeem the notes, in whole or in part, prior to December 1, 2018 at a price equal to 100% of the notes redeemed plus accrued and unpaid interest to the redemption date and a "make-whole premium". Thereafter, the Company may redeem the notes, in whole or in part, at established redemption prices.

11.75% Senior Unsecured Subordinated Notes Due 2021

The Company used proceeds from the issuance of its 7.0% unsecured notes due 2023, discussed above, to redeem all outstanding 11.75% senior unsecured subordinated notes due 2021. Associated with the redemption, the Company incurred $227 million in loss on debt extinguishment.

Accounts receivable securitization agreement

On December 31, 2015, the Company established a new fully consolidated and wholly owned subsidiary, First Data Receivables, LLC (FDR). FDR and FDC entered into an agreement where certain wholly owned subsidiaries of FDC agreed to transfer and contribute receivables to FDR. FDR’s assets are not available to satisfy obligations of any other entities or affiliates of FDC. FDR's creditors will be entitled, upon its liquidation, to be satisfied out of FDR’s assets prior to any assets or value in FDR becoming available to FDR’s equity holders. FDR entered into an agreement with an external party, which expires in 2019, to borrow $240 million secured by liens on the receivables contributed to FDR by the wholly owned subsidiaries of FDC. Loans under the Agreement bear interest based upon LIBOR plus 200 basis points or a base rate equal to the highest of (i) the applicable lender’s prime rate, or (ii) the federal funds rate plus 0.50%. As of December 31, 2015, the Company had no debt outstanding under the Securitization Agreement. In January 2016, FDC and its wholly-owned subsidiaries initially transferred approximately $326 million in receivables to FDR as part of its Securitization Program. FDR utilized the receivables as collateral in borrowings of $240 million under this agreement. The $240 million in gross proceeds was utilized to redeem a portion of the Company's 8.75% senior secured second lien notes on January 15, 2016.

Maturities

The following table presents the future aggregate annual maturities of long-term debt excluding unamortized discounts and deferred financing costs:



Year ended December 31, (in millions)	Par Amount
2016	$	823
2017	75
2018	5,973
2019	11
2020	1,399
Thereafter	11,453
Total	$	19,734

Guarantees and Covenants

All obligations under the senior secured revolving credit facility and senior secured term loan facility are unconditionally guaranteed by most of the existing and future, direct and indirect, wholly owned, material domestic subsidiaries of the Company. The senior secured facilities contain a number of covenants that, among other things, restrict the Company’s ability to incur additional indebtedness; create liens; enter into sale and leaseback transactions; engage in mergers or consolidations; sell or transfer assets; pay dividends and distributions or repurchase the Company’s capital stock; make investments, loans or advances; prepay certain indebtedness; make certain acquisitions; engage in certain transactions with affiliates; amend material agreements governing certain indebtedness; and change its lines of business. The senior secured facilities also require the Company to not exceed a maximum senior secured leverage ratio and contain certain customary affirmative covenants and events of default, including a change of control. The senior secured term loan facility also requires mandatory prepayments based on a percentage of excess cash flow generated by the Company. The Company is in compliance with all applicable covenants.

All senior secured notes are guaranteed on a senior secured basis by each of the Company’s existing and future direct and indirect wholly owned domestic subsidiaries that guarantees the Company’s senior secured credit facilities. Each of the guarantees of the notes is a general senior obligation of each guarantor and rank senior in right of payment to all existing and future subordinated indebtedness of the guarantor subsidiary, including the Company’s existing senior subordinated notes. The notes rank equal in right of payment with all existing and future senior indebtedness of the guarantor subsidiary but are effectively senior to the guarantees of the Company’s existing senior unsecured notes and the Company’s existing senior secured second lien notes to the extent of the Company’s and the guarantor subsidiary’s value of the collateral securing the notes. The 6.75% Senior Secured First Lien Notes, 5.375% Senior Secured First Lien Notes, and 5.0% Senior Secured First Lien Notes are effectively equal in right of payment with each other and the guarantees of the Company’s senior secured credit facilities. Each series of notes are effectively subordinated to any obligations secured by liens permitted under the indenture for the particular series of notes and structurally subordinated to any existing and future indebtedness and other liabilities of any subsidiary of a guarantor that is not also a guarantor of the notes.

All senior unsecured notes (i) rank senior in right of payment to all of the Company’s existing and future subordinated indebtedness, (ii) rank equally in right of payment to all of the existing and future senior indebtedness, (iii) are effectively subordinated in right of payment to all existing and future secured debt to the extent of the value of the assets securing such debt, and (iv) are structurally subordinated to all obligations of each subsidiary that is not a guarantor of the senior notes.

The notes are similarly guaranteed in accordance with their terms by each of the Company’s domestic subsidiaries that guarantee obligations under the Company’s senior secured term loan facility described in more detail in note 18 "Supplemental Guarantor Condensed Consolidating Financial Statements" of these consolidated financial statements.

All obligations under the senior secured notes, senior secured second lien notes, and senior unsecured notes also contain a number of covenants similar to those described for the senior secured obligations noted above. The Company is in compliance with all applicable covenants.