Debt

The Company’s outstanding debt is as follows:



(In millions of dollars)	September 30, 2011		December 31, 2010
Short-term:
Current portion of long-term debt	$	260	$	8
Long-term:
Senior notes – 6.25% due 2012 (5.1% effective interest rate)	$	251	$	253
Senior notes – 4.850% due 2013	250		250
Senior notes – 5.875% due 2033	296		296
Senior notes – 5.375% due 2014	326		648
Senior notes – 5.75% due 2015	479		747
Senior notes – 9.25% due 2019	398		398
Senior notes – 4.80% due 2021	496		—
Mortgage – 5.70% due 2035	433		439
Other	1		3
	2,930		3,034
Less current portion	260		8
	$	2,670	$	3,026

The senior notes in the table above are publically registered by the Company with no guarantees attached.

On June 27, 2011, the Company commenced tender offers (the “tender offers”) to purchase for cash up to a total of $500 million aggregate principal amount of its outstanding 5.375% notes due 2014 (the “2014 Notes”) and 5.750% notes due 2015 (the “2015 Notes” and together with the 2014 Notes, the “Outstanding Notes”), of which $650 million and $750 million, respectively, were then outstanding.

On July 15, 2011, the Company purchased a total of $600 million of the Outstanding Notes comprised of $330 million of its 2014 Notes and $270 million of its 2015 Notes. The Company acquired the notes at market value plus a tender premium, which exceeded the notes' carrying value.

The Company used proceeds from the issuance of 4.80% ten-year $500 million senior notes in the third quarter of 2011 and cash on hand to fund the amounts associated with the tendered bonds.

During the third quarter of 2010, the Company repaid its 5.15% fixed rate $550 million senior notes that matured.

On October 13, 2011, the Company and certain of its foreign subsidiaries entered into a new $1.0 billion multi-currency five-year unsecured revolving credit facility, which replaced the $1.0 billion facility discussed below, which was in effect as of September 30, 2011. The interest rate on this facility is based on LIBOR plus a fixed margin which varies with the Company's credit ratings. This facility requires the Company to maintain certain coverage and leverage ratios which are tested quarterly.

The Company and certain of its foreign subsidiaries previously maintained a $1.0 billion multi-currency three-year unsecured revolving credit facility. This facility was due to expire in October 2012. There were no borrowings outstanding under this facility at September 30, 2011.

Derivative Financial Instruments

In February 2011, the Company entered into two $125 million 3.5-year interest rate swaps to hedge changes in the fair value of the first $250 million of the outstanding 5.375% senior notes due in 2014.

Under the terms of the swaps, the counter-parties will pay the Company a fixed rate of 5.375% and the Company will pay interest at a floating rate of three-month LIBOR plus a fixed spread of 3.726%. The maturity date of the senior notes and the swaps match exactly. The floating rate resets quarterly, with every second reset occurring on the interest payment date of the senior notes. The swaps net settle every six months on the senior note coupon payment dates. The swaps are designated as fair value hedging instruments and are deemed to be perfectly effective in accordance with applicable accounting guidance. The fair value of the swaps at inception was zero and subsequent changes in the fair value of the interest rate swaps are reflected in the carrying value of the interest rate swaps and in the consolidated balance sheet. The carrying value of the debt on the balance sheet was adjusted by an equal amount. The gain or loss on the hedged item (fixed rate debt) and the offsetting gain or loss on the interest rate swaps as of September 30, 2011 are as follows:



Income statement classification (In millions of dollars)	Gain on Swaps		Loss on Notes			Net Income Effect
Other Operating Expenses	$	7	$	(7	)	$	—

The amounts earned and owed under the swap agreements are accrued each period and are reported in interest expense. There was no ineffectiveness recognized in the periods presented. The portion of the debt acquired under the tender offer discussed above was not part of the first $250 million outstanding and therefore, did not impact the hedged portion of this debt.