DEBT AND FINANCING ARRANGEMENTS

3 Months Ended

Mar. 31, 2021

The carrying value of our outstanding debt obligations as of March 31, 2021 and December 31, 2020 consists of the following (in millions):


	Principal Amount			Carrying Value
			Maturity	2021		2020
Commercial paper	$	697	2021	$	697	$	15

Fixed-rate senior notes:
3.125% senior notes	—		2021	—		1,507
2.050% senior notes	700		2021	700		700
2.450% senior notes	1,000		2022	1,028		1,028
2.350% senior notes	600		2022	599		599
2.500% senior notes	1,000		2023	997		997
2.800% senior notes	500		2024	498		498
2.200% senior notes	400		2024	398		398
3.900% senior notes	1,000		2025	995		995
2.400% senior notes	500		2026	498		498
3.050% senior notes	1,000		2027	993		993
3.400% senior notes	750		2029	746		746
2.500% senior notes	400		2029	397		397
4.450% senior notes	750		2030	744		743
6.200% senior notes	1,500		2038	1,483		1,483
5.200% senior notes	500		2040	493		493
4.875% senior notes	500		2040	490		490
3.625% senior notes	375		2042	368		368
3.400% senior notes	500		2046	491		491
3.750% senior notes	1,150		2047	1,137		1,137
4.250% senior notes	750		2049	742		742
3.400% senior notes	700		2049	688		688
5.300% senior notes	1,250		2050	1,231		1,231
Floating-rate senior notes:
Floating-rate senior notes	350		2021	350		350
Floating-rate senior notes	400		2022	400		399
Floating-rate senior notes	500		2023	499		499
Floating-rate senior notes	1,039		2049-2067	1,027		1,027
8.375% Debentures:

8.375% debentures	276		2030	281		281
Pound Sterling Notes:
5.500% notes	91		2031	91		90
5.125% notes	626		2050	594		586
Euro Senior Notes:
0.375% senior notes	821		2023	818		857
1.625% senior notes	821		2025	818		856
1.000% senior notes	587		2028	584		611
1.500% senior notes	587		2032	583		611

Canadian senior notes:
2.125% senior notes	594		2024	592		583
Finance lease obligations	352		2021-2159	352		342
Facility notes and bonds	320		2029-2045	320		320
Other debt	5		2021-2025	5		5
Total debt	$	23,891		23,727		24,654
Less: current maturities				(1,811)		(2,623)
Long-term debt				$	21,916	$	22,031

Commercial Paper

We are authorized to borrow up to $10.0 billion under a U.S. commercial paper program and €5.0 billion (in a variety of currencies) under a European commercial paper program. As of March 31, 2021, we had U.S. commercial paper outstanding of $697 million with an average interest rate of 0.06% and no outstanding balances under our European commercial paper program. As of March 31, 2021, we have classified the entire commercial paper balance as a current liability on our consolidated balance sheets. The amount of commercial paper outstanding under these programs in 2021 is expected to fluctuate.

Debt Classification

We have classified certain floating-rate senior notes that are redeemable at the option of the note holder as long-term liabilities on our consolidated balance sheets, due to our intent and ability to refinance the debt if the put option is exercised.

Debt Repayments

On January 15, 2021, our 3.125% senior notes with a principle balance of $1.5 billion matured and were repaid in full.

Sources of Credit

We maintain two credit agreements with a consortium of banks. The first of these agreements provides revolving credit facilities of $2.0 billion, and expires on December 7, 2021. Amounts outstanding under this agreement bear interest at a periodic fixed rate equal to LIBOR for the applicable interest period and currency denomination, plus a margin of 0.875%. Alternatively, a fluctuating rate of interest equal to the highest of (1) the rate of interest last quoted by The Wall Street Journal as the prime rate in the United States; (2) the Federal Funds effective rate plus 0.50%; or (3) LIBOR for a one-month interest period plus 1.00%, may be used at our discretion.

The second agreement provides revolving credit facilities of $2.5 billion, and expires on December 11, 2023. Amounts outstanding under this facility bear interest at a periodic fixed rate equal to LIBOR for the applicable interest period and currency denomination, plus an applicable margin. Alternatively, a fluctuating rate of interest equal to the highest of (1) the rate of interest last quoted by The Wall Street Journal as the prime rate in the United States; (2) the Federal Funds effective rate plus 0.50%; and (3) LIBOR for a one month interest period plus 1.00%, plus an applicable margin, may be used at our discretion.

The applicable margin for advances bearing interest based on LIBOR is a percentage determined by quotations from Markit Group Ltd. for our one-year credit default swap spread subject to a minimum rate of 0.10% and a maximum rate of 0.75% per annum. The rate is interpolated for a period of time from the date of determination of such credit default swap spread in connection with a new interest period until the latest maturity date of the facility then in effect (but not less than a period of one year).

The applicable margin for advances bearing interest based on the prime rate is 1.00% below the applicable margin for LIBOR advances (but not lower than 0%). We are also able to request advances under these facilities based on competitive bids for the applicable interest rate.

There were no amounts outstanding under these facilities as of March 31, 2021.

Debt Covenants

Our existing debt instruments and credit facilities subject us to certain financial covenants. As of March 31, 2021, and for all prior periods presented, we have satisfied these financial covenants. These covenants limit the amount of secured indebtedness that we may incur, and limit the amount of attributable debt in sale-leaseback transactions, to 10% of net tangible assets. As of March 31, 2021, 10% of net tangible assets was equivalent to $4.1 billion and we had no covered sale-leaseback transactions or secured indebtedness outstanding. We do not expect these covenants to have a material impact on our financial condition or liquidity.

Fair Value of Debt

Based on the borrowing rates currently available to us for long-term debt with similar terms and maturities, the fair value of long-term debt, including current maturities, was approximately $26.3 and $28.3 billion as of March 31, 2021 and December 31, 2020, respectively. We utilized Level 2 inputs in the fair value hierarchy of valuation techniques to determine the fair value of all of our debt instruments.