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LONG-TERM DEBT | 12 Months Ended
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Dec. 31, 2022
Long-Term Debt, Unclassified [Abstract] |
LONG-TERM DEBT | DEBT Total debt, including long-term, current maturities and debt issuance costs and discounts – net, consisted of the following (in millions of dollars):
| As of December 31,
| 2022 |  | 2021
| Carrying Value |  | Fair Value |  | Carrying Value |  | Fair Value
4.60% senior notes due 2045 | $ | 1,000 |  |  | $ | 916 |  |  | $ | 1,000 |  |  | $ | 1,284 |
1.85% senior notes due 2025 | 500 |  |  | 470 |  |  | 500 |  |  | 509 |
4.20% senior notes due 2047 | 400 |  |  | 338 |  |  | 400 |  |  | 492 |
3.75% senior notes due 2046 | 400 |  |  | 317 |  |  | 400 |  |  | 459 |
Japanese yen term loan | 69 |  |  | 69 |  |  | 78 |  |  | 78 |
Other | (29) |  |  | (29) |  |  | 7 |  |  | 7 |
Subtotal | 2,340 |  |  | 2,081 |  |  | 2,385 |  |  | 2,829 |
Less current maturities | (35) |  |  | (35) |  |  | — |  |  | — |
Debt issuance costs and discounts – net of amortization | (21) |  |  | (21) |  |  | (23) |  |  | (23) |
Long-term debt | $ | 2,284 |  |  | $ | 2,025 |  |  | $ | 2,362 |  |  | $ | 2,806 |
Revolving Credit Facility In February 2020, the Company entered into a five-year unsecured credit agreement. Grainger may obtain loans in various currencies on a revolving basis in an aggregate amount not exceeding $1.25 billion (revolving credit facility), which may be increased up to $1.875 billion at the request of the Company, subject to approval from lenders and other customary conditions. The primary purpose of the revolving credit facility is to support the Company's commercial paper program and for general corporate purposes. The revolving credit facility replaced the Company's former $750 million unsecured revolving credit facility, which originated in October 2017 and was scheduled to mature in October 2022. In August 2022, the Company entered into a First Amendment (the Amendment) to its revolving credit facility. The Amendment changes the benchmark rate for borrowings denominated in U.S. and foreign currencies from LIBOR to certain alternative benchmark rates. This includes benchmark rates based on the Euro Interbank Offered Rate (EURIBOR) for borrowings denominated in Euros, the Canadian Dollar Offer Rate (CDOR) for borrowings denominated in Canadian dollars, the Sterling Overnig ht Index Average (SONIA) for borrowings denominated in sterling and Secured Overnight Financing Rate (SOFR) for borrowings denominated in U.S. dollars. The Amendment also updates certain other provisions regarding successor interest rates to LIBOR. There were no borrowings outstanding under the revolving credit facility as of December 31, 2022 and 2021. The Company's foreign subsidiaries utilize various financing sources for working capital purposes and other operating needs. These financing sources in aggregate were not m aterial as of December 31, 2022 and 2021. Commercial Paper The Company issues commercial paper from time to time for general working capital needs. As of December 31, 2022 and 2021, there was none outstanding. Senior Notes In the years 2015-2020, Grainger issued $2.3 billion in unsecured long-term debt (senior notes) primarily to provide flexibility in funding general working capital needs, share repurchases and long-term cash requirements. The senior notes require no principal payments until maturity and interest is paid semi-annually. The Company may redeem the senior notes in whole at any time or in part from time to time at a make-whole redemption price prior to their respective maturity dates. The redemption price is calculated by reference to the then-current yield on a U.S. treasury security with a maturity comparable to the remaining term of the senior notes plus 10-25 basis points, together with accrued and unpaid interest, at the redemption date. Additionally, if the Company experiences specific kinds of changes in control, it will be required to make an offer to purchase the senior notes at 101% of their principal amount plus accrued and unpaid interest, at the date of purchase. Within one year of the maturity date, the Company may redeem the senior notes in whole at any time or in part at 100% of their principal amount, together with accrued and unpaid interest, at the redemption date. The Company incurred debt issuance costs related to the senior notes of approximately $29 million, representing underwriting fees and other expenses. These costs were recorded as a contra-liability in Long-term debt and are being amortized over the term of the senior notes using the straight-line method to Interest expense – net. Grainger uses interest rate swaps to manage the risks associated with the 1.85% senior notes. These swaps were designated for hedge accounting treatment as fair value hedges. The resulting carrying value adjustments as of December 31, 2022 and 2021, are presented in Other in the table above. For further discussion on the Company's hedge accounting policies and derivative instruments, see Note 12. Term Loan In August 2020, MonotaRO entered into a ¥9 billion term loan agreement to fund technology investments and the expansion of its distribution center (DC) network. As of December 31, 2022 and 2021, the carrying amount of the term loan, including current maturities due within one year, was $69 million a nd $78 million, respectively. The term loan matures in 2024, payable over four equal semi-annual principal installments in 2023 and 2024 and bears an average interest rate of 0.05%. Fair Value The estimated fair value of the Company’s senior notes was based on available external pricing data and current market rates for similar debt instruments, among other factors, which are classified as Level 2 inputs within the fair value hierarchy. The Company's debt instruments include affirmative and negative covenants that are usual and customary for companies with similar credit ratings and do not contain any financial performance covenants. The Compa ny was i n compliance with all debt covenants as of December 31, 2022 and 2021. The scheduled aggregate principal payments required on the Company's indebtedness, based on the maturity dates defined within the debt arrangements, for the succeeding five years, excluding debt issuance costs and the impact of derivatives, are due as follows (in millions of dollars):
Year |  | Payment Amount
2023 |  | $ | 35 |
2024 |  | 34 |
2025 |  | 500 |
2026 |  | 5 |
2027 |  | — |
Thereafter |  | 1,800 |
Total |  | $ | 2,374 |

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