ACCOUNTS RECEIVABLES

3 Months Ended

Mar. 31, 2020

NOTE 3. ACCOUNTS RECEIVABLES

On July 16, 2019, our existing $250.0 million Receivables Financing Agreement was extended to July 15, 2022 and downsized to $10.0 million with the option to expand (Receivables Financing Agreement). During the three months ended March 31, 2020, we amended the Receivables Financing Agreement to expand the borrowing capacity and borrowed $150.0 million. During April 2020, we expanded the facility and borrowed an additional $100.0 million. The Receivables Financing Agreement includes a minimum borrowing requirement of 50% of the available borrowing capacity or facility limit, whichever is greater, beginning on October 1, 2020. The administrative agent for our Receivables Financing Agreement is PNC Bank, National Association. Under the Receivables Financing Agreement, our eligible trade receivables are used for collateralized borrowings and continue to be serviced by us. In addition, the Receivables Financing Agreement incorporates the leverage covenant that is contained in the $2,000.0 million senior credit facility. As of March 31, 2020, $345.2 million of our trade receivables were pledged as collateral. As of March 31, 2020, we had $150.0 million drawn and no additional borrowing capacity under the Receivables Financing Agreement. As of December 31, 2019 and March 31, 2019, we had zero and $125.0 million, respectively, drawn under the Receivables Financing Agreement.

Olin also has trade accounts receivable factoring arrangements (AR Facilities) and pursuant to the terms of the AR Facilities, certain of our subsidiaries may sell their accounts receivable up to a maximum of $315.0 million. We will continue to service the outstanding accounts sold. 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 condensed statements of cash flows. The following table summarizes the AR Facilities activity:



	March 31,
	2020			2019
	($ in millions)
Balance at beginning of year	$	63.1		$	132.4
Gross receivables sold	262.0			134.9
Payments received from customers on sold accounts	(256.2		)	(170.5		)
Balance at end of period	$	68.9		$	96.8

The factoring discount paid under the AR Facilities is recorded as interest expense on the condensed statements of operations. The factoring discount was $0.6 million and $0.5 million for the three months ended March 31, 2020 and 2019, respectively. The agreements are without recourse and therefore no recourse liability had been recorded as of March 31, 2020, December 31, 2019, or March 31, 2019.