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Debt | 12 Months Ended
--- | ---
Dec. 31, 2021
Debt Disclosure [Abstract] |
Debt | Debt The Company’s debt consisted of the following at December 31:
(In millions) |  | 2021 |  | 2020
Short-term and current maturities of long-term debt: |  |  |  |
Foreign lines of credit |  | $ | 240 |  |  | $ | 144 |
Finance lease and other financing obligations |  | 268 |  |  | 240 |
Total short-term and current maturities of long-term debt |  | $ | 508 |  |  | $ | 384 |
Long-term debt: |  |  |  |
4.750% senior notes due June 2021 |  | $ | — |  |  | $ | 400 |
3.500% senior notes due October 2022 |  | 700 |  |  | 700 |
0.375% senior notes due July 2023 (Euro-denominated) |  | 566 |  |  | 612 |
3.800% senior notes due October 2023 |  | 1,000 |  |  | 1,000 |
2.750% senior notes due July 2024 |  | 2,000 |  |  | 2,000 |
3.850% senior notes due June 2025 |  | 900 |  |  | 900 |
2.250% senior notes due July 2025 (British Pound-denominated) |  | 705 |  |  | 709 |
3.200% senior notes due July 2026 |  | 2,000 |  |  | 2,000 |
2.250% senior notes due June 2027 |  | 1,000 |  |  | 1,000 |
1.125% senior notes due July 2027 (Euro-denominated) |  | 566 |  |  | 612 |
4.200% senior notes due October 2028 |  | 1,000 |  |  | 1,000 |
3.500% senior notes due July 2029 |  | 3,000 |  |  | 3,000 |
2.650% senior notes due June 2030 |  | 1,000 |  |  | 1,000 |
1.625% senior notes due July 2030 (Euro-denominated) |  | 566 |  |  | 612 |
3.000% senior notes due July 2031 (British Pound-denominated) |  | 705 |  |  | 709 |
4.400% senior notes due July 2049 |  | 2,000 |  |  | 2,000 |
U.S. commercial paper notes |  | 916 |  |  | — |
Euro commercial paper notes |  | 905 |  |  | — |
Revolving credit facility |  | 97 |  |  | 22 |
Receivable securitized loan |  | 500 |  |  | 425 |
Term loan facility |  | 200 |  |  | 1,250 |
Unamortized discount and deferred financing costs |  | (125) |  |  | (155) |
Finance lease and other financing obligations |  | 528 |  |  | 504 |
Total long-term debt |  | $ | 20,729 |  |  | $ | 20,300 |
Annual maturities of the Company’s total debt were as follows at December 31, 2021:
(In millions) |
Year Ending December 31, |
2022 | $ | 508 |
2023 | 4,923 |
2024 | 2,391 |
2025 | 1,677 |
2026 | 2,027 |
Thereafter | 9,836 |
Total principal payments | 21,362 |
Unamortized discount and deferred financing costs | (125) |
Total debt | $ | 21,237 |
Senior Notes The Company has outstanding $17.7 billion of various fixed-rate senior notes, as described above. The indentures governing the Company’s senior notes contain covenants that, among other matters, limit (i) the Company’s ability to consolidate or merge with or into, or convey, transfer or lease all or substantially all of its properties and assets to, another person, (ii) the Company’s and certain of its subsidiaries’ ability to create or assume liens, and (iii) the Company’s and certain of its subsidiaries’ ability to engage in sale and leaseback transactions. The Company may, at its option, redeem the senior notes, in whole or, from time to time, in part, at any time prior to the applicable maturity date. Interest on the Company’s U.S. dollar-denominated senior notes is paid semi-annually, while interest on its Euro- and British Pound-denominated senior notes is paid annually. The interest rate applicable to certain of the senior notes is subject to an increase of up to two percent in the event that the credit rating assigned to such notes is downgraded below investment grade. During the year ended December 31, 2021, the Company used a portion of the net proceeds from the 2021 issuance of commercial paper notes, as described below, to repay the outstanding principal balance of $400 million under its 4.75% senior notes that matured in June 2021. At December 31, 2021, the 3.50% senior notes due in October 2022 were classified in the consolidated balance sheet as long-term and within the debt maturity schedule above as maturing in September 2023, the date that the Company’s revolving credit facility expires, as the Company has the intent to refinance this debt on a long-term basis and the ability to do so under its revolving credit facility. Commercial Paper The Company initiated an unsecured U.S. dollar commercial paper program (“USCP”) in May 2021 and an unsecured Euro commercial paper program (“ECP”) in November 2021. From time to time, the Company may issue under these programs U.S. dollar commercial paper with maturities of up to 397 days from the date of issuance and Euro commercial paper with maturities of up to 183 days from the date of issuance. Outstanding borrowings under the USCP were $916 million at December 31, 2021, with a weighted average interest rate of 0.295%. Outstanding borrowings under the ECP were $905 million at December 31, 2021, with a weighted average interest rate of (0.420)%. The Company intends to maintain available capacity under its revolving credit facility, as described below, in an amount at least equal to the aggregate outstanding borrowings under its commercial paper programs. Outstanding borrowings under the commercial paper programs are classified in the consolidated balance sheet as long-term and within the debt maturity schedule above as maturing in September 2023, the date that the Company’s revolving credit facility expires, as the Company has the intent to refinance this commercial paper on a long-term basis through the continued issuance of new commercial paper upon maturity, and the Company also has the ability to refinance such commercial paper under its revolving credit facility. During the year ended December 31, 2021, the Company used the net proceeds from the issuance of commercial paper notes to repay outstanding borrowings under its amended and restated revolving credit facility, to repay its 4.75% senior notes that matured in June 2021, and to pay down outstanding borrowings on its term loan facility. Revolving Credit Facility The Company maintains an amended and restated revolving credit facility, which matures in September 2023, with aggregate commitments available for $3.5 billion of total capacity. U.S. dollar borrowings under the amended and restated revolving credit facility bear interest at a variable rate based on LIBOR, typically at the overnight or 1-month rates, or a base rate, plus, in each case, a specified margin based on the Company’s long-term debt rating in effect from time to time. Foreign currency borrowings under the amended and restated revolving credit facility bear interest at a variable rate based on a benchmark applicable to the relevant currency, plus, in each case, a specified margin based on our long-term debt rating in effect from time to time. The variable interest rate on the revolving credit facility borrowings was 1.16% at December 31, 2021. There are no significant commitment fees and no compensating balance requirements. The amended and restated revolving credit facility contains various restrictions and covenants that require the Company, among other things, to (i) limit its consolidated indebtedness as of the end of each fiscal quarter to no more than three and one-half times the Company’s consolidated net earnings before interest, taxes, depreciation, amortization, non-cash charges and expenses and certain other adjustments (“EBITDA”) during the period of four fiscal quarters then ended, subject to certain exceptions, and (ii) maintain EBITDA of at least three times its consolidated interest expense as of the end of each fiscal quarter for the period of four fiscal quarters then ended. The Company was in compliance with all financial debt covenants during 2021. Foreign Lines of Credit and Other Arrangements The Company maintains certain short-term lines of credit with foreign banks and alliance partners primarily to fund settlement activity. These arrangements are primarily associated with international operations and are in various functional currencies, the most significant of which is the Argentine peso. The Company had amounts outstanding on these lines of credit totaling $240 million and $144 million at a weighted-average interest rate of 21.01% and 21.98% at December 31, 2021 and 2020, respectively. Receivable Securitized Loan The Company maintains a consolidated wholly-owned subsidiary, First Data Receivables, LLC (“FDR”). FDR is a party to certain receivables financing arrangements, including an agreement (“Receivables Financing Agreement”) with certain financial institutions and other persons from time to time party thereto as lenders and group agents, pursuant to which certain wholly-owned subsidiaries of the Company have agreed to transfer and contribute receivables to FDR, and FDR in turn may obtain borrowings from the financial institutions and other lender parties to the Receivables Financing Agreement secured by liens on those receivables. FDR’s assets are not available to satisfy the obligations of any other entities or affiliates of the Company, and FDR’s creditors would be entitled, upon its liquidation, to be satisfied out of FDR’s assets prior to any assets or value in FDR becoming available to the Company. The receivables held by FDR are recorded within trade accounts receivable, net in the Company’s consolidated balance sheets. FDR held $1.0 billion and $811 million in receivables as part of the securitization program at December 31, 2021 and 2020, respectively. FDR utilized the receivables as collateral in borrowings of $500 million and $425 million as of December 31, 2021 and 2020, respectively, at an average interest rate of 0.95% and 1.00%, respectively. Outstanding borrowings bear interest at a variable rate based on one-month LIBOR plus a specified margin. At December 31, 2021, the collateral capacity under the Receivables Financing Agreement was $747 million, and the maximum borrowing capacity was $500 million. The term of the Receivables Financing Agreement is through July 2022. At December 31, 2021, outstanding borrowings under the receivable securitized loan facility were classified in the consolidated balance sheet as long-term and within the debt maturity schedule above as maturing in September 2023, the date that the Company’s revolving credit facility expires, as the Company has the intent to refinance this debt on a long-term basis and the ability to do so under its revolving credit facility. Term Loan Facility The Company maintains a term loan credit agreement with a syndicate of financial institutions that was funded in conjunction with the acquisition of First Data in an original principal amount of $5.0 billion. Following various amortization payments and prepayments, the aggregate principal amount outstanding under such agreement was $200 million at December 31, 2021. Borrowings under the term loan facility bear interest at variable rates based on one-month LIBOR or on a base rate, plus, in each case, a specified margin based on the Company’s long-term debt rating in effect from time to time, and will mature in July 2024. The variable interest rate on the term loan facility borrowings was 1.35% at December 31, 2021. A portion of the net proceeds from the Company’s 2021 issuances of commercial paper, as described above, was used to pay down outstanding borrowings under the term loan facility. The term loan credit facility contains affirmative, negative and financial covenants, and events of default, that are substantially the same as those set forth in the Company’s existing amended and restated revolving credit facility, as described above. Deferred Financing Costs Deferred financing costs are amortized as a component of interest expense, net over the term of the underlying debt using the effective interest method. Deferred financing costs primarily related to the Company’s senior notes totaled $92 million and $117 million at December 31, 2021 and 2020, respectively, and are reported as a direct reduction of the related debt instrument in the consolidated balance sheets. Deferred financing costs related to the Company’s revolving credit facility are reported in other long-term assets in the consolidated balance sheets and totaled $3 million and $5 million at December 31, 2021 and 2020, respectively. Debt Financing Activities On January 16, 2019, in connection with the definitive merger agreement to acquire First Data (see Note 4), the Company entered into a bridge facility commitment letter pursuant to which a group of financial institutions committed to provide a 364-day senior unsecured bridge term loan facility in an aggregate principal amount of $17.0 billion for the purpose of funding the repayment of certain indebtedness of First Data and its subsidiaries on the closing date of the acquisition of First Data, making cash payments in lieu of fractional shares as part of the acquisition consideration and paying fees and expenses related to the acquisition, the refinancing and the related transactions. The Company recorded $98 million of expenses, reported within debt financing activities in the consolidated statements of income, related to the bridge term loan facility during the year ended December 31, 2019. The aggregate commitments of $17.0 billion under the bridge facility commitment letter were replaced with a corresponding amount of permanent financing through the term loan credit agreement and issuance of senior notes, as described above, resulting in the termination of the bridge term loan facility effective July 1, 2019. In June 2019, the Company entered into foreign exchange forward contracts to minimize foreign currency exposure to the Euro and British Pound upon settlement of the proceeds from the foreign currency-denominated senior notes, as described above. The foreign exchange forward contracts matured on July 1, 2019, concurrent with the closing of the offering of the foreign currency-denominated senior notes. The Company realized foreign currency transaction gains of $3 million, reported within debt financing activities in the consolidated statement of income during the year ended December 31, 2019, from these foreign exchange forward contracts. Further, upon completion of the acquisition of First Data, the Company designated its Euro- and British Pound-denominated senior notes as net investment hedges to hedge a portion of its net investment in certain Euro- and British Pound-denominated subsidiaries (see Note 14). Prior to designating the foreign currency-denominated senior notes as net investment hedges, the Company realized foreign currency transaction gains of $69 million, reported within debt financing activities in the consolidated statement of income during the year ended December 31, 2019, as a result of changes in the U.S. dollar equivalent of the Euro- and British Pound-denominated senior notes due to fluctuations in foreign currency exchange rates. In addition, the Company held a portion of the proceeds from the issuance of these foreign currency-denominated senior notes in Euro- and British Pound-denominated cash and cash equivalents. The Company realized foreign currency transaction losses of $19 million, reported within debt financing activities in the consolidated statement of income during the year ended December 31, 2019, as a result of changes in the U.S. dollar equivalent of the Euro- and British Pound-denominated cash due to fluctuations in foreign currency exchange rates.

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