XML 24 R10.htm IDEA: XBRL DOCUMENT
v3.7.0.1

BORROWINGS | 3 Months Ended
--- | ---
Mar. 31, 2017
Debt Disclosure [Abstract] |
BORROWINGS | BORROWINGS
| March 31, |  | December 31,
(Dollars in millions) | 2017 |  | 2016
Borrowings consisted of: |  |  |
5.5% notes due November 2019 | $ | 249 |  |  | $ | 249 |
2.7% notes due January 2020 | 796 |  |  | 796 |
4.5% notes due January 2021 | 184 |  |  | 184 |
3.6% notes due August 2022 | 740 |  |  | 741 |
1.50% notes due May 2023 | 797 |  |  | 786 |
7 1/4% debentures due January 2024 | 197 |  |  | 197 |
7 5/8% debentures due June 2024 | 43 |  |  | 43 |
3.8% notes due March 2025 | 689 |  |  | 689 |
1.875% notes due November 2026 | 527 |  |  | 519 |
7.60% debentures due February 2027 | 195 |  |  | 195 |
4.8% notes due September 2042 | 492 |  |  | 493 |
4.65% notes due October 2044 | 871 |  |  | 870 |
Credit facilities borrowings | 799 |  |  | 549 |
Commercial paper borrowings | 295 |  |  | 280 |
Capital leases and other | 9 |  |  | 3 |
Total borrowings | 6,883 |  |  | 6,594 |
Borrowings due within one year | 305 |  |  | 283 |
Long-term borrowings | $ | 6,578 |  |  | $ | 6,311 |
Credit Facility and Commercial Paper Borrowings In December 2014, Eastman borrowed $1 billion under a five-year term loan ("2019 Term Loan"). As of March 31, 2017, the 2019 Term Loan agreement balance outstanding was $250 million with an interest rate of 2.23 percent. As of December 31, 2016, the 2019 Term Loan agreement balance outstanding was $250 million with an interest rate of 2.02 percent. In December 2016, the Company borrowed $300 million under a second five-year term loan ("2021 Term Loan"). As of March 31, 2017, the 2021 Term Loan agreement balance outstanding was $299 million with an interest rate of 2.23 percent. As of December 31, 2016, the 2021 Term Loan balance outstanding was $299 million, net of debt issue costs, with an interest rate of 1.95 percent. Borrowings under the 2019 Term Loan and 2021 Term Loan agreements are subject to interest at varying spreads above quoted market rates. The Company has access to a $1.25 billion revolving credit agreement (the "Credit Facility") that expires October 2021. Borrowings under the Credit Facility are subject to interest at varying spreads above quoted market rates and a commitment fee is paid on the total unused commitment. The Credit Facility provides liquidity support for commercial paper borrowings and general corporate purposes. Commercial paper borrowings are classified as short-term. At March 31, 2017 and December 31, 2016, the Company had no outstanding borrowings under the Credit Facility. At March 31, 2017, the Company's commercial paper borrowings were $295 million with a weighted average interest rate of 1.24 percent. At December 31, 2016, the Company's commercial paper borrowings were $280 million with a weighted average interest rate of 1.12 percent. The Company has access to a $250 million accounts receivable securitization agreement (the "A/R Facility") that expires April 2019. Eastman Chemical Financial Corporation ("ECFC"), a subsidiary of the Company, has an agreement to sell interests in trade receivables under the A/R Facility to a third party purchaser. Third party creditors of ECFC have first priority claims on the assets of ECFC before those assets would be available to satisfy the Company's general obligations. Borrowings under the A/R Facility are subject to interest rates based on a spread over the lender's borrowing costs, and ECFC pays a fee to maintain availability of the A/R Facility. In first quarter 2017, the entire $250 million available under the A/R Facility was borrowed and remained outstanding at March 31, 2017 with an interest rate of 1.77 percent. At December 31, 2016, the Company had no borrowings under the A/R Facility. The Credit and A/R Facilities and other borrowing arrangements contain a number of customary covenants and events of default, including requirements to maintain certain financial ratios that determine the amounts available and terms of borrowings. The Company was in compliance with all covenants at both March 31, 2017 and December 31, 2016. Fair Value of Borrowings The Company has classified its long-term borrowings at March 31, 2017 and December 31, 2016, under the fair value hierarchy as defined in the accounting policies in Note 1, "Significant Accounting Policies", to the consolidated financial statements in Part II, Item 8 of the Company's 2016 Annual Report on Form 10-K. The fair value for fixed-rate debt securities is based on current market prices and is classified as Level 1. The fair value for the Company's other borrowings under the Term Loans and the A/R Facility equals the carrying value and is classified as Level 2.
|  |  |  | Fair Value Measurements at March 31, 2017
(Dollars in millions) |  | Recorded Amount March 31, 2017 |  | Total Fair Value |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
Long-term borrowings |  | $ | 6,578 |  |  | $ | 6,898 |  |  | $ | 6,099 |  |  | $ | 799 |  |  | $ | — |
|  |  |  | Fair Value Measurements at December 31, 2016
(Dollars in millions) |  | Recorded Amount December 31, 2016 |  | Total Fair Value |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
Long-term borrowings |  | $ | 6,311 |  |  | $ | 6,586 |  |  | $ | 6,036 |  |  | $ | 550 |  |  | $ | — |

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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
Name: | us-gaap_DebtDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration