NOTE E – BORROWINGS AND CREDIT ARRANGEMENTS

We had total debt of $5.765 billion as of March 31, 2018 and $5.616 billion as of December 31, 2017. The debt maturity schedule for the significant components of our long-term debt obligations is presented below:



(in millions, except interest rates)	Issuance Date	Maturity Date	As of						Semi-annual Coupon Rate
(in millions, except interest rates)	Issuance Date	Maturity Date	March 31, 2018			December 31, 2017			Semi-annual Coupon Rate
October 2018 Notes	August 2013	October 2018	—			†			2.650	%
January 2020 Notes	December 2009	January 2020	850			850			6.000	%
May 2020 Notes	May 2015	May 2020	600			600			2.850	%
May 2022 Notes	May 2015	May 2022	500			500			3.375	%
October 2023 Notes	August 2013	October 2023	450			450			4.125	%
May 2025 Notes	May 2015	May 2025	750			750			3.850	%
March 2028 Notes	February 2018	March 2028	1,000			—			4.000	%
November 2035 Notes	November 2005	November 2035	350			350			7.000	%
January 2040 Notes	December 2009	January 2040	300			300			7.375	%
Unamortized Debt Issuance Discount		2020 - 2040	(14		)	(6		)
Unamortized Deferred Financing Costs		2020 - 2040	(19		)	(18		)
Unamortized Gain on Fair Value Hedges		2020 - 2023	35			38
Capital Lease Obligation		Various	1			1
Long-term debt			$	4,803		$	3,815

^†As of December 31, 2017, $600 million under the October 2018 Notes was outstanding and classified as short-term debt.



Note:	The table above does not include unamortized amounts related to interest rate contracts designated as cash flow hedges.

Revolving Credit Facility

As of March 31, 2018 and December 31, 2017, we maintained a $2.250 billion revolving credit facility (the 2017 Facility) with a global syndicate of commercial banks that matures on August 4, 2022. This facility provides backing for the commercial paper program described below. There were no amounts borrowed under our revolving credit facility as of March 31, 2018 and December 31, 2017.

The 2017 Facility requires that we maintain certain financial covenants, as follows:



	Covenant Requirement	Actual
	as of March 31, 2018	as of March 31, 2018
Maximum leverage ratio (1)	3.5 times	2.2 times


(1)	Ratio of total debt to consolidated EBITDA, as defined by the credit agreement, for the preceding four consecutive fiscal quarters.

The 2017 Facility provides for an exclusion from the calculation of consolidated EBITDA, as defined by the agreement, through maturity, of any non-cash charges and up to $500 million in restructuring charges and restructuring-related expenses related to our current or future restructuring plans. As of March 31, 2018, we had $415 million of the restructuring charge exclusion remaining. In addition, any cash litigation payments (net of any cash litigation receipts), as defined by the 2017 Facility, are excluded from the calculation of consolidated EBITDA, as defined in the 2017 Facility, provided that the sum of any excluded net cash litigation payments does not exceed $2.624 billion in the aggregate. As of March 31, 2018, we had $1.690 billion of the legal exclusion remaining.

Any inability to maintain compliance with these covenants could require us to seek to renegotiate the terms of our credit facility or seek waivers from compliance with these covenants, both of which could result in additional borrowing costs. Further, there can be no assurance that our lenders would agree to such new terms or grant such waivers on terms acceptable to us. In this case, all credit facility commitments would terminate and any amounts borrowed under the facility would become immediately due and payable. Furthermore, any termination of our credit facility may negatively impact the credit ratings assigned to our commercial paper program which may impact our ability to refinance any then outstanding commercial paper as it becomes due and payable.

Commercial Paper

As of March 31, 2018, we had $886 million of commercial paper outstanding and $1.197 billion outstanding as of December 31, 2017. Our commercial paper program is backed by the 2017 Facility, which allows us to have a maximum of $2.250 billion in commercial paper outstanding. Outstanding commercial paper directly reduces borrowing capacity available under the 2017 Facility. As of March 31, 2018, the commercial paper issued and outstanding had a weighted average maturity of 22 days and a weighted average yield of 2.46 percent. As of December 31, 2017, the commercial paper issued and outstanding had a weighted average maturity of 38 days and a weighted average yield of 1.85 percent.

Senior Notes

We had senior notes outstanding of $4.800 billion as of March 31, 2018 and $4.400 billion as of December 31, 2017.

In February 2018, we completed an offering of $1.000 billion in aggregate principal amount of 4.000% senior notes, due March 2028. We used a portion of the net proceeds from the offering to repay the $600 million plus accrued interest of our 2.650% senior notes due in October 2018. The remaining proceeds were used to repay a portion of our outstanding commercial paper.

Our senior notes were issued in public offerings, are redeemable prior to maturity and are not subject to sinking fund requirements. Our senior notes are unsecured, unsubordinated obligations and rank on parity with each other. These notes are effectively junior to borrowings under our credit and security facility, and to the extent borrowed by our subsidiaries, to liabilities of our subsidiaries (see Other Arrangements below).

Other Arrangements

As of March 31, 2018 and December 31, 2017, we maintained a $400 million credit and security facility secured by our U.S. trade receivables maturing in February 2019. We had outstanding borrowings of $70 million as of March 31, 2018 and no outstanding borrowings as of December 31, 2017 under our credit and security facility.

We have accounts receivable factoring programs in certain European countries that we account for as sales under FASB ASC Topic 860, Transfers and Servicing. These agreements provide for the sale of accounts receivable to third parties, of up to approximately $463 million as of March 31, 2018. We have no retained interests in the transferred receivables, other than collection and administrative responsibilities and, once sold, the accounts receivable are no longer available to satisfy creditors in the event of bankruptcy. We de-recognized $178 million of receivables as of March 31, 2018 at an average interest rate of 2.1 percent and $171 million as of December 31, 2017 at an average interest rate of 1.8 percent.

In March 2018, we entered into a factoring agreement with a commercial Japanese bank. The agreement provides for the sale of accounts receivable and promissory notes of up to 30.000 billion Japanese yen (approximately $282 million as of March 31, 2018). We have no retained interests in the transferred receivables, other than collection and administrative responsibilities and, once sold, the accounts receivable are no longer available to satisfy creditors in the event of bankruptcy. We de-recognized $95 million of receivables as of March 31, 2018 at an average interest rate of 0.5 percent.

In addition, we have uncommitted credit facilities with a commercial Japanese bank that provide for accounts receivable factoring and promissory notes discounting of up to 22.000 billion Japanese yen (approximately $207 million as of March 31, 2018). We have no retained interests in the transferred receivables, other than collection and administrative responsibilities and, once sold, the accounts receivable are no longer available to satisfy creditors in the event of bankruptcy. We de-recognized $124 million of notes receivable as of March 31, 2018 at an average interest rate of 1.5 percent and $157 million of notes receivable as of December 31, 2017 at an average interest rate of 1.3 percent. De-recognized accounts and notes receivable are excluded from trade accounts receivable, net in the accompanying unaudited condensed consolidated balance sheets.

As of and through March 31, 2018, we were in compliance with all the required covenants related to our debt obligations. For additional information regarding the terms of our debt agreements, refer to Note E - Borrowings and Credit Arrangements of the consolidated financial statements in our most recent Annual Report on Form 10-K.