12. Debt and Interest Costs

Long-term debt consisted of the following:


	September 30,		December 31,
($ in millions)	2016		2015

Senior Notes
5.25% due July 2025	$	1,000	$	1,000
4.375% due December 2020		1,000		1,000
4.00% due November 2023		1,000		1,000
4.375%, euro denominated, due December 2023		787		760
5.00% due March 2022		750		750
3.50%, euro denominated, due December 2020		449		435
Senior Credit Facilities, due March 2021 (at variable rates)
Term A loan, due March 2021		1,400		—
Term A loan, euro denominated, due March 2021		1,174		—
Multi-currency USD revolver due March 2021 at variable rate		290		—
Latapack-Ball Notes Payable, denominated in various currencies
(2015 - 4.35%)		—		168
Other (including debt issuance costs)		(47)		(85)
		7,803		5,028
Less: Current portion of long-term debt		(79)		(54)
	$	7,724	$	4,974

Following is a summary of debt refinancing and other costs included in the unaudited condensed consolidated statements of earnings:


	Three Months Ended September 30,				Nine Months Ended September 30,
($ in millions)	2016		2015		2016		2015

Debt Refinancing and Other Costs:
Interest expense on 3.5% and 4.375% senior notes	$	—	$	—	$	(49)	$	—
Economic hedge - interest rate risk		—		(15)		(20)		(10)
Refinance of bridge and revolving credit facilities		—		—		(30)		(5)
Amortization of unsecured, committed bridge facility financing fees		—		(6)		(7)		(13)
Redemption of 6.75% and 5.75% senior notes, due September 2020 and May 2021, respectively, and refinance of senior credit facilities		—		—		—		(58)
Individually insignificant items		(2)		—		(2)		—
	$	(2)	$	(21)	$	(108)	$	(86)

At September 30, 2016, taking into account outstanding letters of credit, approximately $1.2 billion was available under the company’s long-term, revolving credit facility. In addition to this facility, the company had approximately $502 million of short-term uncommitted credit facilities available at September 30, 2016, of which $294 million was outstanding and due on demand. At December 31, 2015, the company had $23 million outstanding under short-term uncommitted credit facilities.

The fair value of long-term debt was estimated to be $8.2 billion at September 30, 2016, which compare to a carrying value of $7.8 billion. The fair value was estimated to be $5.2 billion at December 31, 2015, which approximated its carrying value of $5.1 billion. The fair value reflects the market rates at each period end for debt with credit ratings similar to the company’s ratings and is classified as Level 2 within the fair value hierarchy. Rates currently available to the company for loans with similar terms and maturities are used to estimate the fair value of long-term debt based on discounted cash flows.

The senior notes and senior credit facilities are guaranteed on a full, unconditional and joint and several basis by certain of the company’s wholly owned domestic subsidiaries. Certain foreign denominated tranches of the senior credit facilities are similarly guaranteed by certain of the company’s wholly owned foreign subsidiaries. Note 20 contains further details, as well as required unaudited condensed consolidating financial information for the company, segregating the guarantor subsidiaries and non-guarantor subsidiaries as defined in the senior notes agreements.

The U.S. note agreements, bank credit agreement, and accounts receivable securitization agreement contain certain restrictions relating to dividend payments, share repurchases, investments, financial ratios, guarantees and the incurrence of additional indebtedness. The most restrictive of the company’s debt covenants requires the company to maintain a leverage ratio (as defined) of no greater than 5.5, which changes to 5.0 on December 31, 2016, and to 4.0 on December 31, 2017. The company was in compliance with all loan agreements and debt covenants at September 30, 2016, and December 31, 2015, and has met all debt payment obligations. As of September 30, 2016, the amounts disclosed as available under the company’s long-term multi-currency committed revolving facilities and the short-term uncommitted credit facilities are fully available without violating our existing debt covenants.

In February 2015, Ball entered into the 2018 Revolver to replace its then existing approximate $1 billion revolving credit facility, repay its $93 million Term C loan, repay the outstanding balance on the existing revolving credit facility, redeem the 2020 and 2021 senior notes and repay the existing private placement debt of Rexam upon closing of the acquisition of Rexam. The 2018 Revolver would have expired in February 2018 and accrued interest at LIBOR plus an applicable margin based on the net leverage ratio of the company, which varies from 1.25 percent to 1.75 percent. In June 2015, Ball issued $1 billion of 5.25 percent senior notes due in July 2025. Ball used the net proceeds of this offering and other available cash to repay borrowings under the 2018 Revolver and reduce the borrowing capacity under the 2018 Revolver from $3 billion to $2.25 billion.

Also in February 2015, the company entered into a £3.3 billion Bridge Facility, pursuant to which lending institutions agreed, subject to limited conditions, to provide financing necessary to pay the cash portion of the purchase price payable to Rexam shareholders upon consummation of the acquisition of Rexam and related fees and expenses. In December 2015, the availability under the Bridge Facility was reduced to £1.9 billion.

In March 2015, Ball redeemed its outstanding 6.75 percent senior notes and 5.75 percent senior notes due in September 2020 and May 2021, respectively, at a price per note of 103.375 percent and 106.096 percent, respectively, of the outstanding principal amounts, plus accrued interest.

In December 2015, the company issued $1 billion of 4.375 percent senior notes, €400 million of 3.5 percent senior notes, all due in December 2020, and €700 million of 4.375 percent senior notes, due in December 2023. The company elected to restrict these proceeds in an escrow account, which enabled the reduction of its Bridge Facility capacity from £3.3 billion to £1.9 billion. Subsequent to June 30, 2016, the company used the proceeds to pay a portion of the cash purchase price payable in the Rexam acquisition. Until the Rexam acquisition was consummated, interest on these senior notes was being recorded in debt refinancing and other costs.

In March 2016, Ball refinanced in full the Bridge Facility with a $1.4 billion term A loan facility available to Ball and a €1.1 billion term A loan facility available to a subsidiary of Ball (collectively, the Term Loans), and refinanced in full the 2018 Revolver with the 2021 Revolver, in each case under a secured, five-year credit agreement.

Fees paid in connection with obtaining financing, which totaled $32 million during the nine months ended September 30, 2016, are classified as other, net in cash flows from financing activities in the unaudited condensed consolidated statements of cash flows.