Long-Term Debt

The following table summarizes the carrying value of the Company’s long-term debt (in millions):



	June 30, 2018			December 31, 2017
Term Loan B	$	810		$	1,160
Term Loan A	653			679
Revolving Credit Facility	433			275
Receivables Financing Facility	118			135
Total debt	$	2,014		$	2,249
Less: Debt issuance costs	(6		)	(7		)
Less: Unamortized discounts	(9		)	(15		)
Less: Current portion of long-term debt	(85		)	(51		)
Total long-term debt	$	1,914		$	2,176

At June 30, 2018, the future maturities of debt, excluding debt discounts and issuance costs, are as follows (in millions):



2018	$	37
2019	144
2020	54
2021	1,779
2022	—
Thereafter	—
Total future maturities of long-term debt	$	2,014

The estimated fair value of the Company’s long-term debt approximated $2.0 billion at June 30, 2018 and $2.2 billion at December 31, 2017. These fair value amounts represent the estimated value at which the Company’s lenders could trade its debt within the financial markets and does not represent the settlement value of these long-term debt liabilities to the Company. The fair value of the long-term debt will continue to vary each period based on fluctuations in market interest rates, as well as changes to the Company’s credit ratings. This methodology resulted in a Level 2 classification in the fair value hierarchy.

Credit Facilities

On May 31, 2018, the Company entered into Amendment No.1. to the Amended and Restated Credit Agreement (“Amendment No. 1”). Amendment No. 1 replaced the existing Term Loan A with a new Term Loan A (“Amended Term Loan A”) of $670 million and increased the existing revolving credit facility from $500 million to $800 million (“Revolving Credit Facility”). In addition, as part of the Amendment No. 1, the Company entered into a partial early debt termination of $300 million and repricing of Term Loan B. Amendment No. 1 lowered the index rate spread for LIBOR loans from LIBOR + 200 bp to LIBOR + 175 bp.

In accounting for the impact of Amendment No. 1, the Company applied the provisions of ASC Subtopic 470-50, Modifications and Extinguishments (“ASC 470-50”), which resulted in the second quarter results including approximately $6 million in non-cash accelerated amortization of debt issuance costs and approximately $1 million of one-time pretax charges related to third party fees associated with the amendments, which are reflected as a component of Interest expense,net within the Company’s Consolidated Statements of Operations.

In addition, the issuance of Amended Term Loan A and the increase to the revolving credit facility resulted in $2 million of one-time third party fees for arranger, legal, and other services, which were capitalized and will be amortized over the term of the credit facilities.

As of June 30, 2018, the Term Loan A interest rate was 3.84%, and the Term Loan B interest rate was 4.06%. Borrowings under Term Loan A and B bear interest at a variable rate. Term Loan B borrowings are subject to a floor of 2.75%. Interest payments are payable monthly or quarterly on Term Loan A and quarterly on Term Loan B. The Company has entered into interest rate swaps to manage interest rate risk on Term Loan B. See Note 7, Derivative Instruments.

Amendement No. 1 also requires the Company to prepay certain amounts in the event of certain circumstances or transactions. The Company may make prepayments against the Term Loans, in whole or in part, without premium or penalty. The borrowings under Amendment No. 1 will mature on July 27, 2021.

The Revolving Credit Facility is available for working capital and other general corporate purposes including letters of credit. As of June 30, 2018, the Company had issued letters of credit totaling $5 million, which reduced funds available for other borrowings under the agreement to $795 million. The Revolving Credit Facility will mature and the related commitments will terminate on July 27, 2021.

Borrowings under the Revolving Credit Facility bear interest at a variable rate plus an applicable margin. As of June 30, 2018, the Revolving Credit Facility had an average interest rate of 3.91%. Interest payments are payable monthly or quarterly for the Revolving Credit Facility.

Receivables Financing Facility

On December 1, 2017, a wholly-owned, bankruptcy-remote, special-purpose entity (“SPE”) of the Company entered into the Receivables Purchase Agreement, which provides for a receivables financing facility of up to $180 million. The SPE utilizes the receivables financing facility in the normal course of business as part of its management of cash flows. Under its committed receivables financing facility, a subsidiary of the Company sells its domestically originated accounts receivables at fair value, on a revolving basis, to the SPE which was formed for the sole purpose of buying the receivables. The SPE, in turn, pledges a valid and perfected first-priority security interest in the pool of purchased receivables to a financial institution for borrowing purposes. The subsidiary retains an ownership interest in the pool of receivables that are sold to the SPE and services those receivables. Accordingly, the Company has determined that these transactions do not qualify for sale accounting under ASC 860, Transfers and Servicing of Financial Assets, and has, therefore, accounted for the transactions as secured borrowings.

At June 30, 2018, the Company’s Consolidated Balance Sheets included $419 million of receivables that were pledged and $118 million of associated liabilities. The receivables financing facility will mature on November 29, 2019.

Borrowings under the receivables financing facility bear interest at a variable rate plus an applicable margin. As of June 30, 2018, the receivables financing facility had an average interest rate of 2.94% and requires monthly interest payments.

Both the Revolving Credit Facility and receivables financing facility include terms and conditions that limit the incurrence of additional borrowings and require that certain financial ratios be maintained at designated levels.

Certain domestic subsidiaries of the Company (the “Guarantor Subsidiaries”) guarantee the Term Loan A, Term Loan B, and the Revolving Credit Facility on a senior basis. For the six-month period ended June 30, 2018, the non-Guarantor Subsidiaries would have (a) accounted for 47.8% of our total revenue and (b) held 84.0% or $3.6 billion of our total assets and approximately 80.1% or $2.6 billion of our total liabilities including trade payables but excluding intercompany liabilities.

On June 30, 2018, the Company was in compliance with all covenants.