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DEBT | 6 Months Ended
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Jun. 30, 2017
Debt Disclosure [Abstract] |
DEBT | DEBT The carrying value of debt outstanding, net of unamortized debt issuance costs, was as follows at June 30, 2017 and December 31, 2016:
| June 30, 2017 |  | December 31, 2016
| (in millions)
Short-term: |  |  |
Commercial paper | $ | 200 |  |  | $ | 300 |
$500 million, 7.20% Senior notes due June 15, 2018 | 501 |  |  | — |
Total short-term debt | 701 |  |  | 300 |
Long-term: |  |  |
Senior notes: |  |  |
$500 million, 7.20% due June 15, 2018 | — |  |  | 501 |
$300 million, 6.30% due August 1, 2018 | 303 |  |  | 304 |
$400 million, 2.625% due October 1, 2019 | 398 |  |  | 398 |
$600 million, 3.15% due December 1, 2022 | 596 |  |  | 595 |
$600 million, 3.85% due October 1, 2024 | 595 |  |  | 595 |
$600 million, 3.95% due March 15, 2027 | 594 |  |  | — |
$250 million, 8.15% due June 15, 2038 | 263 |  |  | 264 |
$400 million, 4.625% due December 1, 2042 | 396 |  |  | 396 |
$750 million, 4.95% due October 1, 2044 | 739 |  |  | 739 |
$400 million, 4.80% due March 15, 2047 | 395 |  |  | — |
Total long-term debt | 4,279 |  |  | 3,792 |
Total debt | $ | 4,980 |  |  | $ | 4,092 |
Senior Notes In March 2017, we issued $600 million of 3.95% senior notes due March 15, 2027 and $400 million of 4.80% senior notes due March 15, 2047. Our net proceeds, reduced for the underwriters' discount and commission and offering expenses paid as of March 31, 2017, were $991 million. We intend to use the net proceeds from these issuances for general corporate purposes. Our senior notes, which are unsecured, may be redeemed at our option at any time at 100% of the principal amount plus accrued interest and a specified make-whole amount. The 7.20% and 8.15% senior notes are subject to an interest rate adjustment if the debt ratings assigned to the notes are downgraded (or subsequently upgraded). In addition, each series of our senior notes (other than the 6.30% senior notes) contain a change of control provision that may require us to purchase the notes under certain circumstances. Prior to 2009, we were parties to interest-rate swap agreements that exchanged the fixed interest rate under our senior notes for a variable interest rate based on LIBOR. As a result, the carrying value of the senior notes was adjusted to reflect changes in value caused by an increase or decrease in interest rates. During 2008, we terminated all of our swap agreements. The cumulative adjustment to the carrying value of our senior notes was $103 million as of the termination date which is being amortized as a reduction to interest expense over the remaining term of the senior notes. In October 2014, the redemption of our 6.45% senior notes reduced the unamortized carrying value adjustment by $12 million. The unamortized carrying value adjustment was $21 million as of June 30, 2017 and $23 million as of December 31, 2016. Credit Agreement In May 2017 we amended and restated our previous 5-year $1.0 billion unsecured revolving credit agreement expiring July 2018 with a 5-year $2.0 billion unsecured revolving credit agreement which expires May 2022. Under the credit agreement, at our option, we can borrow on either a competitive advance basis or a revolving credit basis. The revolving credit portion bears interest at either LIBOR plus a spread or the base rate plus a spread. The LIBOR spread, currently 110.0 basis points, varies depending on our credit ratings ranging from 91.0 to 150.0 basis points. We also pay an annual facility fee regardless of utilization. This facility fee, currently 15.0 basis points, may fluctuate between 9.0 and 25.0 basis points, depending upon our credit ratings. The competitive advance portion of any borrowings will bear interest at market rates prevailing at the time of borrowing on either a fixed rate or a floating rate based on LIBOR, at our option. The terms of the credit agreement include standard provisions related to conditions of borrowing, including a customary material adverse effect clause which could limit our ability to borrow additional funds. In addition, the credit agreement contains customary restrictive and financial covenants as well as customary events of default, including financial covenants regarding the maintenance of a minimum level of net worth of $8.9 billion at June 30, 2017 and a maximum leverage ratio of 3.0:1. We are in compliance with the financial covenants, with actual net worth of $11.0 billion and an actual leverage ratio of 1.1:1, as measured in accordance with the credit agreement as of June 30, 2017. Upon our agreement with one or more financial institutions, we may expand the aggregate commitments under the credit agreement to a maximum of $2.5 billion, through a $500.0 million incremental loan facility. At June 30, 2017, we had no borrowings and no letters of credit outstanding under the credit agreement. Accordingly, as of June 30, 2017, we had $2.0 billion of remaining borrowing capacity (which excludes the uncommitted $500.0 million incremental loan facility under the credit agreement), none of which would be restricted by our financial covenant compliance requirement. We have other customary, arms-length relationships, including financial advisory and banking, with some parties to the credit agreement. Commercial Paper We previously entered into a commercial paper program pursuant to which we may issue short-term, unsecured commercial paper notes privately placed on a discount basis through certain broker dealers. On June 15, 2017, we increased the size of the commercial paper program to permit the issuance of the commercial notes with the aggregate face or principal amount outstanding under the program at any time not to exceed $2 billion. Amounts available under the program may be borrowed, repaid and re-borrowed from time to time. The net proceeds of issuances have been and are expected to be used for general corporate purposes. The maximum principal amount outstanding at any one time during the six months ended June 30, 2017 was $500 million. There were outstanding borrowings of $200 million at June 30, 2017 and $300 million at December 31, 2016.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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