DEBT

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

DEBT

DEBT

Short-term financing

During the second quarter of 2020, the Company’s subsidiary, Cosmeticos Avon S.A.C.I entered into an agreement to receive funding from Natura Cosmeticos S.A., a subsidiary of Natura &Co Holding S.A and an affiliate of the Company in the amount of 300 million Argentine Peso which may be used for working capital and other general corporate purposes (the "Argentina Facility"). Any borrowings under the Argentina Facility will bear interest at a rate per annum of 29.81% and has a six-month maturity. At June 30, 2020 the balance outstanding under this loan is $4.6.

In addition, during the second quarter of 2020, we utilized approximately $28 of short-term financing from third-party banks

across multiple markets.

Natura Revolving Credit Facility

In May 2020, the Company’s subsidiary, Avon Luxembourg Holdings S.à r.l entered into a Revolving Credit Facility Agreement with Natura &Co International S.à r.l,. a subsidiary of Natura &Co Holding S.A. and an affiliate of the Company in the amount of $100 which may be used for working capital and other general corporate purposes (the "Facility"). Any borrowings under the Facility will bear interest at a rate per annum of LIBOR plus 7.7% and the Facility will mature on May 31, 2022. As at June 30, 2020, $0 was outstanding under the Facility. On July 3, 2020, $40 was borrowed under the Facility for a six-month tenor.

2019 Revolving Credit Facility

In February 2019, Avon International Capital, p.l.c. ("AIC"), a wholly owned foreign subsidiary of the Company, entered into a three-year €200.0 senior secured revolving credit facility (the "2019 facility") and capitalized $11.0 of issuance costs, the related cash outflow is presented in other financing activities within the 10-K Consolidated Statement of Cash Flows. The 2019 facility was available for general corporate and working capital purposes.

As of December 31, 2019, there were no amounts outstanding under the 2019 facility and on January 3, 2020, the facility was automatically canceled upon change of control, and as a result $7.8 of unamortized issuance costs were written off, see Note 19, Mergers with Natura Cosméticos S.A., to the Consolidated Financial Statements included herein.

Unsecured Notes

In March 2013, we issued a series of unsecured notes (the "2013 Notes"). As of June 30, 2020, the following 2013 Notes remain outstanding; $461.9 aggregate principal amount of 5% Notes due March 15, 2023 and $243.8 aggregate principal amount of 6.95% Notes due March 15, 2043. Interest on the 2013 Notes is payable semiannually on March 15 and September 15 of each year. The indenture governing the 2013 Notes contains interest rate adjustment provisions depending on the long-term credit ratings assigned to the 2013 Notes by S&P and Moody’s. The interest rate on the 2013 Notes is currently at the maximum allowable level of 2% above the respective interest rates in effect on date of issuance.

Senior Secured Notes

In August 2016, Avon International Operations, Inc. ("AIO"), issued $500.0 in aggregate principal amount of 7.875% Senior Secured Notes due August 15, 2022 (the "2016 Notes"). Interest on the 2016 Notes is payable semi-annually on February 15 and August 15 of each year.

In July 2019, AIC issued $400.0 in aggregate principal amount of 6.5% Senior Secured Notes due August 15, 2022 (the "2019 Notes"). Interest on the 2019 Notes is payable semi-annually on February 15 and August 15 of each year.

For a more detailed description of the Company’s debt agreements, refer to Note 8, Debt and Other Financing of our Annual Report on Form 10-K for the year ended December 31, 2019.