ACCOUNTS RECEIVABLE

12 Months Ended

Dec. 31, 2017

ACCOUNTS RECEIVABLE [Abstract]

ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLES

On December 20, 2016, we entered into a three year, $250.0 million Receivables Financing Agreement with PNC Bank, National Association, as administrative agent (Receivables Financing Agreement). Under the Receivables Financing Agreement, our eligible trade receivables are used for collateralized borrowings and continue to be serviced by us. As of December 31, 2017 and 2016, $340.9 million and $282.3 million, respectively, of our trade receivables were pledged as collateral and we had $249.7 million and $210.0 million, respectively, drawn under the agreement. For the year ended December 31, 2017, we borrowed $40.0 million under the Receivables Financing Agreement and used the proceeds to fund a portion of the payment to DowDuPont associated with a long-term ethylene supply contract to reserve additional ethylene at producer economics. For the year ended December 31, 2016, the proceeds of the Receivables Financing Agreement were used to repay $210.0 million of the Sumitomo Credit Facility. As of December 31, 2017, we had $0.3 million additional borrowing capacity under the Receivables Financing Agreement. In addition, the Receivables Financing Agreement incorporates the leverage and coverage covenants that are contained in the senior revolving credit facility.

On June 29, 2016, we entered into a trade accounts receivable factoring arrangement and, on December 22, 2016, we entered into a separate trade accounts receivable factoring arrangement, which were both subsequently amended (collectively the AR Facilities). Pursuant to the terms of the AR Facilities, certain of our subsidiaries may sell their accounts receivable up to a maximum of $294.0 million. We will continue to service such accounts.  These receivables qualify for sales treatment under ASC 860 “Transfers and Servicing” and, accordingly, the proceeds are included in net cash provided by operating activities in the consolidated statements of cash flows.  The gross amount of receivables sold for the years ended December 31, 2017 and 2016 totaled $1,655.2 million and $533.6 million, respectively.  The factoring discount paid under the AR Facilities is recorded as interest expense on the consolidated statements of operations. The factoring discount for the years ended December 31, 2017 and 2016 was $3.7 million and $1.1 million, respectively. The agreements are without recourse and therefore no recourse liability has been recorded as of December 31, 2017.  As of December 31, 2017 and 2016, $182.3 million and $126.1 million, respectively, of receivables qualifying for sales treatment were outstanding and will continue to be serviced by us.

At December 31, 2017 and 2016, our consolidated balance sheets included other receivables of $105.5 million and $95.6 million, respectively, which were classified as receivables, net.