Note 13. Debt

Long-term debt and short-term borrowings consisted of the following (in millions):


	December 31, 2014			December 31, 2013
Senior Credit Facility:
Revolving Credit Facility, maturing 2020	$	5		$	—
Senior Notes, interest at 7.375%, maturing 2015		294			294
Senior Notes, interest at 6.75%, maturing 2018		372			372
Senior Notes, interest at 7.15%, maturing 2019		209			207
Senior Notes, interest at 3.125%, maturing 2023		349			349
Senior Notes, interest at 3.75%, maturing 2025		346			—
Senior Notes, interest at 4.50%, maturing 2034		291			—
Capital lease obligations		156			3
Commercial paper, weighted average interest at 0.451% at December 31, 2014		634			—
Mortgages and other, interest rates ranging from non-interest bearing to 3.65%, various maturities		39			42

		2,695			1,267
Less current maturities		(297	)		(2	)

Long-term debt	$	2,398		$	1,265

Aggregate debt maturities for each of the years ending December 31 are as follows (in millions):


2015	$	297
2016		33
2017		6
2018		376
2019		213
Thereafter		1,770

	$	2,695

We maintain lines of credit under which bank loans and other short-term debt can be drawn on. In addition, smaller credit lines are maintained by our foreign subsidiaries. We had approximately $1.12 billion of available borrowing capacity under our domestic and foreign lines of credit as of December 31, 2014. The short-term borrowings under these lines of credit at December 31, 2014 and 2013 were de minimis. During 2014, we entered into the Fourth Amendment to our $1.75 billion Revolving Credit facility (the Facility). The amendment extended the maturity of the Facility by two years to February 2020. The Facility, when drawn upon, has an applicable margin, inclusive of a commitment fee, of 1.20%, plus the applicable currency LIBOR rate. We paid fees of approximately $2 million in connection with this amendment and capitalized these costs as deferred financing costs. Additionally, in connection with this amendment, we recorded a net charge of approximately $1 million in the loss on early extinguishment of debt, net line item to write-off certain existing deferred financing costs.

During the year ended December 31, 2014, we entered into a master lease arrangement to lease the entire buildings and land where we are headquartered in Stamford, Connecticut. The term of the lease is 20 years, with two five-year extensions at our option. We have fixed annual payments of approximately $10 million, which escalate at 3% per year. As a result of this transaction, as of December 31, 2014, we have recorded a capital lease obligation of approximately $153 million with an interest rate of 5.76%.

During the year ended December 31, 2014, we established a Commercial Paper Program (Commercial Paper), which gives us the ability to issue up to $1.75 billion of short-term unsecured notes. We reserve unused capacity under the Facility to repay outstanding Commercial Paper borrowings in the event that the commercial paper market is not available to us for any reason when outstanding borrowings mature. While any outstanding Commercial Paper and Facility borrowings generally have short-term maturities, we classify the outstanding borrowings as long-term based on our ability and intent to refinance the outstanding borrowings on a long-term basis.

Also, during the year ended December 31, 2014, we completed a public offering of $350 million in aggregate principal amount of Senior Notes due 2025 (the 2025 Notes) and $300 million in aggregate principal amount of Senior Notes due 2034 (the 2034 Notes). The 2025 Notes and 2034 Notes are direct, unsecured obligations and rank equally with all of our existing and future unsecured and unsubordinated obligations. The 2025 Notes bear interest at a fixed rate of 3.75% per annum and mature on March 15, 2025. The 2034 Notes bear interest at a fixed rate of 4.50% per annum and mature on October 1, 2034. We will pay interest on the 2025 Notes on March 15 and September 15 each year until maturity, beginning on March 15, 2015. We will pay interest on the 2034 Notes on April 1 and October 1 each year until maturity, beginning on April 1, 2015. We used the net proceeds for general corporate purposes, which included the repayment of Commercial Paper, repurchases of our common stock and the payment of previously announced regular and special dividends to our stockholders.

We may redeem all or a portion of the 2025 Notes at our option at any time prior to December 15, 2024 at the make-whole redemption price equal to the greater of (1) 100% of the aggregate principal amount of the 2025 Notes being redeemed, plus accrued and unpaid interest to, but excluding, the redemption date; and (2) the sum of the present values of the remaining scheduled payments of principal and interest in respect of the 2025 Notes being redeemed (exclusive of any interest accrued to the date of redemption) discounted to the redemption date on a semi-annual basis at the Treasury Rate (as defined in the supplemental indenture relating to the 2025 Notes) plus 25 basis points, plus accrued and unpaid interest to, but excluding, the redemption date. At any time on or after December 15, 2024, we may redeem all or a portion of the 2025 Notes at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest to, but excluding, the redemption date.

We may redeem all or a portion of the 2034 Notes at our option at any time prior to April 1, 2034 at the make-whole redemption price equal to the greater of (1) 100% of the aggregate principal amount of the 2034 Notes being redeemed, plus accrued and unpaid interest to, but excluding, the redemption date; and (2) the sum of the present values of the remaining scheduled payments of principal and interest in respect of the 2034 Notes being redeemed (exclusive of any interest accrued to the date of redemption) discounted to the redemption date on a semi-annual basis at the Treasury Rate (as defined in the supplemental indenture relating to the 2034 Notes) plus 25 basis points, plus accrued and unpaid interest to, but excluding, the redemption date. At any time on or after April 1, 2034, we may redeem all or a portion of the 2034 Notes at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest to, but excluding, the redemption date.

In 2011, we received an incentive in the form of a $10 million loan (the Loan) from the State of Connecticut, in connection with the relocation of our corporate headquarters to Stamford, Connecticut, which we classified in mortgages and other. The Loan had an opportunity for $7 million principal forgiveness if a certain employment threshold was met before December 31, 2014. During the year ended December 31, 2013, we received notification from the State of Connecticut that we had met the employment threshold and that $7 million of the Loan was forgiven.

During the year ended December 31, 2012, we completed a tender offer to purchase four different series of senior notes. The offer to purchase resulted in principal tenders of $321 million of our 7.875% Senior Notes due 2014, $156 million of our 7.375% Senior Notes due 2015, $29 million of our 6.75% Senior Notes due 2018 and $40 million of our 7.15% Senior Notes due 2019. Subsequent to the tender offer, we exercised our option to redeem the remaining $179 million 7.875% Senior Notes due 2014. We paid $833 million in connection with these redemptions and recorded a charge of approximately $113 million in the loss on early extinguishment of debt, net, line item in our statements of income.

During the year ended December 31, 2012, we also exercised our option to redeem all of our outstanding 6.25% Senior Notes due 2013, which had a principal amount of approximately $495 million. We paid approximately $513 million in connection with this redemption and recorded a net charge of approximately $15 million in the loss on early extinguishment of debt, net, line item in our statements of income.

We are subject to certain restrictive debt covenants under our short-term borrowing and long-term debt obligations including a financial maintenance covenant, limitations on incurring additional debt, restrictions on liens, limitations on ability to pay dividends, escrow account funding requirements for debt service, capital expenditures, tax payments and insurance premiums, among other restrictions. We were in compliance with all of the short-term and long-term debt covenants at December 31, 2014.

During the year ended December 31, 2014, we entered into one interest rate swap with a notional amount of $50 million and during the year ended December 31, 2013, we entered into four interest rate swaps with a total notional amount of $200 million. Under these swaps, we pay floating and receive fixed interest rates (see Note 21).