Debt

The following is a summary of the Company's debt as of December 27, 2013 and March 29, 2013:



(Amounts in millions)	December 27, 2013		March 29, 2013
4.45% term notes, due September 2022	$	409	$	349
6.50% term notes, due March 2018	938		998
2.50% term notes, due September 2015	350		350
Note payable, due December 2014	409		—
Term loan facility, due September 2016	—		250
Mandatorily redeemable preferred stock outstanding	60		59
Note payable of consolidated subsidiary	67		62
Capitalized lease liabilities	510		561
Borrowings for assets acquired under long-term financing	74		98
Other borrowings	4		5
Total debt	2,821		2,732
Less: short term debt and current maturities of long term debt	637		234
Total long-term debt	$	2,184	$	2,498

Term loan facility

During the third quarter of fiscal 2014, the Company's subsidiary, Computer Sciences Holdings (UK) Ltd., entered into a £250 million or $409 million (at the December 27, 2013 exchange rates; $408 million on the Consolidated Statement of Cash Flow due to the impact of movement in foreign currency exchange rates) short-term note payable, due December 2014, with a financial institution. The note bears interest at a variable rate based on LIBOR plus a margin of 17 basis points (bps) and is payable quarterly. The note is guaranteed by the Company, and financial covenants associated with the note are the same as those associated with the Company's $2.5 billion revolving credit facility, as mentioned below. The Company was in compliance with all covenants as of December 27, 2013.

During the third quarter of fiscal 2014, the Company repaid the $250 million term loan, due September 2016 (2016 Term Loan), from its cash balances on hand. The Company recorded $1 million as additional interest expense to write-off previously deferred debt issuances expenses associated with the 2016 Term Loan.

Term note exchanges

During the third quarter of fiscal 2014, the Company entered into multiple exchange agreements to exchange an aggregate of $40 million original principal amount of its 6.50% term notes due 2018 for an aggregate of $47 million original principal amount of its 4.45% term notes, due 2022. During the second quarter of fiscal 2014, the Company entered into an exchange agreement with a noteholder to exchange $21 million original principal amount of its 6.50% term notes due 2018 for $25 million original principal amount of its 4.45% term notes due 2022. These term note exchanges were accounted for as a debt modification and as a result, the difference between the original principal value of term notes exchanged was accounted for as additional debt discount, which along with the existing unamortized discount and deferred financing costs, will be amortized to interest expense over the term of the 4.45% term notes, using the effective interest method.

Interest rate swaps

As disclosed in Note 7, during the second quarter of fiscal 2014, the Company entered into multiple interest rate swap transactions to hedge the fair value of $275 million of its 4.45% term notes, due 2022, which effectively converted the debt into floating interest rate debt. Under the terms of the swap transactions, the Company will receive semi-annual interest payments at the coupon rate of 4.45% and will pay monthly interest at the one month LIBOR rate, plus a weighted average contractual margin. The Company designated these interest rate swaps as fair value hedges and is accounting for them in accordance with the shortcut method under ASC Topic 815 (See Note 7). The change in the fair value of the interest rate swaps from inception to December 27, 2013 was under $1 million. The carrying value of the 4.45% term notes due 2022, recorded as long-term debt within the Consolidated Condensed Balance Sheets, was decreased by this amount.

Revolving credit facility

During the third quarter of fiscal 2014, the Company amended its unsecured $1.5 billion revolving credit facility by expanding its borrowing capacity to $2.5 billion and extending its maturity to January 15, 2019. The terms of the amended $2.5 billion facility allow for borrowings by both CSC and certain of its international subsidiaries within a $2 billion sub-limit for borrowings denominated in U.S. dollar, Euros and Pound Sterling, and a $0.5 billion sub-limit for borrowings denominated in U.S. dollar, Euros, Pounds Sterling, Japanese Yen, Australian Dollar and Singapore Dollar. The amended credit facility also provides, on an uncommitted basis, that the aggregate amount of the facility may be increased to up to $3 billion. The amended facility has a lower interest margin on drawn amounts and provides for lower commitment fees on undrawn amounts than the prior credit facility. The Company incurred costs of $4 million related to amendment and expansion of the credit facility. These costs have been deferred and will be amortized over the term of the facility. There were no borrowings outstanding against the $2.5 billion credit facility at December 27, 2013, and the Company was in compliance with all the financial covenants at December 27, 2013.