In 2017, International Paper issued $1.0 billion of 4.35% senior unsecured notes with a maturity date in 2048. The proceeds from this offering, together with a combination of available cash and other borrowings, were used to make a $1.25 billion voluntary cash contribution to the Company's pension plan. In December 2017, International Paper received $660 million in cash proceeds from a new loan entered into as part of the transfer of the North American Consumer Packaging business to a subsidiary of Graphic Packing Holding Company discussed in Note 7. The Company used the cash proceeds, together with available cash, to pay down existing debt of approximately $900 million of notes with interest rates ranging from 1.92% to 9.38% and original maturities from 2018 to 2021. Pre-tax early debt retirement costs of $83 million related to the debt repayments, including $82 million of cash premiums, are included in Restructuring and other charges in the accompanying consolidated statement of operations for the year ended December 31, 2017. The $660 million term loan was subsequently assumed by Graphic Packaging International, LLC on January 1, 2018 and is classified as Liabilities held for sale at December 31, 2017, in the accompanying consolidated balance sheet.

In 2016, International Paper issued $1.1 billion of 3.00% senior unsecured notes with a maturity date in 2027, and $1.2 billion of 4.40% senior unsecured notes with a maturity date in 2047. In addition, the Company repaid approximately $266 million of notes with an interest rate of 7.95% and an original maturity of 2018. Pre-tax early debt retirement costs of $29 million related to the debt repayments, including $31 million of cash premiums, are included in Restructuring and other charges in the accompanying consolidated statement of operations for the year ended December 31, 2016.

In June 2016, International Paper entered into a commercial paper program with a borrowing capacity of $750 million. Under the terms of the program, individual maturities on borrowings may vary, but not exceed one year from the date of issue. Interest bearing notes may be issued either as fixed notes or floating rate notes. As of December 31, 2017, the Company had $180 million outstanding under this program.

Amounts related to early debt extinguishment during the years ended December 31, 2017, 2016 and 2015 were as follows:



In millions	2017		2016		2015
Debt reductions (a)	$	993	$	266	$	2,151
Pre-tax early debt extinguishment costs (b)	83		29		207


(a)	Reductions related to notes with interest rates ranging from 1.57% to 9.38% with original maturities from 2015 to 2030 for the years ended December 31, 2017, 2016 and 2015. Includes the $630 million payment for a portion of the Special Purpose Entity Liability for the year ended December 31, 2015 (see Note 12 Variable Interest Entities).


(b)	Amounts are included in Restructuring and other charges in the accompanying consolidated statements of operations.

A summary of long-term debt follows:



In millions at December 31	2017			2016
9 3/8% note – due 2019	$	—		$	295
8.7% note – due 2038	264			264
7.95% debenture – due 2018	—			382
7.5% note – due 2021	409			598
7.3% note – due 2039	721			721
6 7/8% notes – due 2023 – 2029	131			131
6.65% note – due 2037	4			4
6 5/8% note – due 2018	—			72
6.4% to 7.75% debentures due 2025 – 2027	143			142
6.0% note – due 2041	585			585
5.00% to 5.15% notes – due 2035 – 2046	1,281			1,280
4.8% note – due 2044	796			796
4.75% note – due 2022	817			810
3.00% to 4.40% notes – due 2024 – 2048	4,775			3,786
Floating rate notes – due 2017 – 2025 (a)	650			763
Environmental and industrial development bonds – due 2017 – 2035 (b)	585			681
Other (c)	(4		)	4
Total (d)	11,157			11,314
Less: current maturities	311			239
Long-term debt	$	10,846		$	11,075


(a)	The weighted average interest rate on these notes was 2.6% in 2017 and 2.2% in 2016.


(b)	The weighted average interest rate on these bonds was 6.0% in 2017 and 5.9% in 2016.


(c)	Includes $70 million and $69 million of debt issuance costs as of December 31, 2017 and 2016, respectively.


(d)	The fair market value was approximately $12.3 billion at December 31, 2017 and $12.0 billion at December 31, 2016.

Total maturities of long-term debt over the next five years are 2018 – $311 million; 2019 – $126 million; 2020 – $164 million; 2021 – $440 million; and 2022 – $956 million.

At December 31, 2017, International Paper’s credit facilities (the Agreements) totaled $2.1 billion. The Agreements generally provide for interest rates at a floating rate index plus a pre-determined margin dependent upon International Paper’s credit rating. The Agreements include a $1.5 billion contractually committed bank facility that expires in December 2021 and has a facility fee of 0.15% payable annually. The liquidity facilities also include up to $600 million of uncommitted financings based on eligible receivables balances under a receivables securitization program that expires in December 2018. At December 31, 2017, there were no borrowings under either the bank facility or receivables securitization program.

The Company’s financial covenants require the maintenance of a minimum net worth of $9 billion and a total debt-to-capital ratio of less than 60%. Net worth is defined as the sum of common stock, paid-in capital and retained earnings, less treasury stock plus any cumulative goodwill impairment charges. The calculation also excludes accumulated other comprehensive income/loss and Nonrecourse Financial Liabilities of Special Purpose Entities. The total debt-to-capital ratio is defined as total debt divided by the sum of total debt plus net worth. As of December 31, 2017, we were in compliance with our debt covenants.