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Short And Long Term-Debt | 9 Months Ended
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Sep. 30, 2015
Debt Disclosure [Abstract] |
Short And Long-Term Debt | SHORT AND LONG-TERM DEBT Total indebtedness is as follows:
| September 30, 2015 |  | December 31, 2014
Senior Secured Credit Facility: |  |  |
Revolving Credit Facility | $ | — |  |  | $ | — |
Term Loan B Facility | 1,858 |  |  | 1,871 |
7.625% First Lien Notes | 593 |  |  | 593 |
9.00% First and a Half Lien Notes | 196 |  |  | 196 |
3.375% Senior Notes | 500 |  |  | 500 |
4.50% Senior Notes | 450 |  |  | 450 |
5.25% Senior Notes | 300 |  |  | 300 |
Total Short & Long-Term Debt | $ | 3,897 |  |  | $ | 3,910 |
Securitization Obligations: |  |  |
Apple Ridge Funding LLC | $ | 325 |  |  | $ | 255 |
Cartus Financing Limited | 10 |  |  | 14 |
Total Securitization Obligations | $ | 335 |  |  | $ | 269 |
Indebtedness Table As of September 30, 2015, the total capacity, outstanding borrowings and available capacity under the Company’s borrowing arrangements were as follows:
| Interest Rate |  | Expiration Date |  | Total Capacity |  | Outstanding Borrowings |  | Available Capacity
Senior Secured Credit Facility: |  |  |  |  |  |  |  |  |
Revolving Credit Facility (1) | (2) |  | March 2018 |  | $ | 475 |  |  | $ | — |  |  | $ | 475 |
Term Loan B Facility | (3) |  | March 2020 |  | 1,872 |  |  | 1,858 |  |  | — |
First Lien Notes (1) | 7.625% |  | January 2020 |  | 593 |  |  | 593 |  |  | — |
First and a Half Lien Notes | 9.00% |  | January 2020 |  | 196 |  |  | 196 |  |  | — |
Senior Notes | 3.375% |  | May 2016 |  | 500 |  |  | 500 |  |  | — |
Senior Notes | 4.50% |  | April 2019 |  | 450 |  |  | 450 |  |  | — |
Senior Notes | 5.25% |  | December 2021 |  | 300 |  |  | 300 |  |  | — |
Securitization obligations: (4) |  |  |  |  |  |  |  |  |
Apple Ridge Funding LLC (5) |  |  | June 2016 |  | 375 |  |  | 325 |  |  | 50 |
Cartus Financing Limited (6) |  |  | August 2016 |  | 38 |  |  | 10 |  |  | 28 |
Total (7) | $ | 4,799 |  |  | $ | 4,232 |  |  | $ | 553 |
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(1) | See Note 11, "Subsequent Events" for a description of the October 2015 amendment of the Senior Secured Revolving Credit Facility and entry into a new Senior Secured Term Loan A Facility. The net proceeds of the Term Loan A Facility together with revolver borrowings were used to discharge the First Lien Notes in October 2015. As of November 3, 2015, after giving effect to the amendment of the facility, the Company had no outstanding borrowings on the Revolving Credit Facility, leaving $815 million of available capacity.
(2) | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at September 30, 2015 were based on, at Realogy Group’s option, (a) adjusted LIBOR plus 2.75% or (b) JPMorgan Chase Bank, N.A.'s prime rate ("ABR") plus 1.75%.
(3) | Consists of a $1,872 million Term Loan B, less a discount of $14 million. There is 1% per annum amortization of principal. The interest rate with respect to the Term Loan B Facility is based on, at Realogy Group’s option, (a) adjusted LIBOR plus 3.00% (with a LIBOR floor of 0.75%) or (b) JPMorgan Chase Bank, N.A.’s prime rate ("ABR") plus 2.00% (with an ABR floor of 1.75%).
(4) | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations.
(5) | In June 2015, Realogy Group amended the existing Apple Ridge Funding LLC securitization program utilized by Cartus. The capacity under the facility was temporarily increased from $325 million to $375 million from June 2015 until October 2015, at which time the capacity was reduced to $325 million.
(6) | Consists of a £20 million revolving loan facility and a £5 million working capital facility.
(7) | Not included in this table, the Company had $135 million of outstanding letters of credit at September 30, 2015, of which $53 million was under the synthetic letter of credit facility with a rate of 4.25% and $82 million was under the unsecured letter of credit facility with a rate of 2.98%.
Maturities Table As of September 30, 2015, the combined aggregate amount of maturities for long-term borrowings, excluding securitizations, for the remainder of 2015 and each of the next four years is as follows:
Year |  | Amount
Remaining 2015 |  | $ | 5 |
2016 |  | 519 |
2017 |  | 19 |
2018 |  | 19 |
2019 |  | 469 |
Senior Secured Credit Facility The senior secured credit agreement, as amended and in effect as of September 30, 2015 (the "Amended and Restated Credit Agreement") provides for:
(a) | a Term Loan B Facility initially issued in the aggregate principal amount of $1,905 million with a maturity date of March 5, 2020. The Term Loan B Facility has quarterly amortization payments totaling 1% per annum of the $1,905 million of Term Loan B principal. The interest rate with respect to the Term Loan B Facility is based on, at Realogy Group's option, adjusted LIBOR plus 3.00% (with a LIBOR floor of 0.75%) or ABR plus 2.00% (with an ABR floor of 1.75%); and
(b) | a $475 million Revolving Credit Facility with a maturity date of March 5, 2018, which includes (i) a $250 million letter of credit subfacility and (ii) a swingline loan subfacility. The interest rate with respect to revolving loans under the Revolving Credit Facility is based on, at Realogy Group's option, adjusted LIBOR plus 2.75% or ABR plus 1.75%.
The Amended and Restated Credit Agreement provides for a synthetic letter of credit facility which matures on October 10, 2016. The synthetic letter of credit facility may be utilized for general corporate purposes, including the support of Realogy Group’s obligations with respect to Cendant contingent and other liabilities assumed under the Separation and Distribution Agreement. The capacity of the synthetic letter of credit facility is reduced by 1% per annum. As of September 30, 2015, the capacity under the synthetic letter of credit facility was $54 million and the facility was being utilized for a $53 million letter of credit with Cendant for potential contingent obligations. The Amended and Restated Credit Agreement permits the Company to obtain up to $500 million of additional credit facilities from lenders reasonably satisfactory to the administrative agent and us, without the consent of the existing lenders under the new senior secured credit facility, plus an unlimited amount if Realogy Group's senior secured leverage ratio is less than 3.50 to 1.00 on a pro forma basis. Subject to certain restrictions, the Amended and Restated Credit Agreement also permits us to issue senior secured or unsecured notes in lieu of any incremental facility. The obligations under the Amended and Restated Credit Agreement are secured to the extent legally permissible by substantially all of the assets of Realogy Group, Realogy Intermediate and all of their domestic subsidiaries, other than certain excluded subsidiaries. Realogy Group’s Amended and Restated Credit Agreement contains financial, affirmative and negative covenants and requires Realogy Group to maintain a senior secured leverage ratio, not to exceed 4.75 to 1.00, and pursuant to the October 2015 amendment discussed in Note 11, "Subsequent Events," the leverage ratio is tested quarterly, commencing with the period ended September 30, 2015, regardless of the amount of borrowings outstanding, and letters of credit issued, under the revolver at the testing date. In this report, the Company refers to the term "Adjusted EBITDA" to mean EBITDA as so defined for purposes of determining compliance with the senior secured leverage covenant. The senior secured leverage ratio measured at any applicable quarter end is Realogy Group's total senior secured net debt divided by the trailing twelve month adjusted EBITDA. Total senior secured net debt does not include the First and a Half Lien Notes, other indebtedness secured by a lien that is pari passu or junior in priority to the First and a Half Lien Notes, unsecured indebtedness, including the Unsecured Notes, as well as the securitization obligations. At September 30, 2015, Realogy Group’s senior secured leverage ratio was 2.36 to 1.00. See Note 11, "Subsequent Events" for a description of the October 2015 amendment to the Amended and Restated Credit Agreement, pursuant to which the borrowing capacity under the Revolving Credit Facility was increased to $815 million. See Note 11, "Subsequent Events" for a description of the October 2015 Term Loan A Agreement, pursuant to which Realogy Group borrowed $435 million under a new Term Loan A Facility. First Lien Notes The First Lien Notes are senior secured obligations of Realogy Group and bore interest at a rate of 7.625% per annum. On October 23, 2015, Realogy Group issued a notice of redemption for all $593 million outstanding aggregate principal amount of the First Lien Notes and discharged its obligations under the related indenture. In connection with the redemption of the First Lien Notes and related discharge of the indenture, Realogy Group deposited a total of $638 million with the trustee, which included the applicable redemption premium and accrued and unpaid interest on the First Lien Notes. The payment of the redemption price was funded with the net proceeds from the new Term Loan A Facility described above and revolver borrowings. First and a Half Lien Notes The First and a Half Lien Notes are senior secured obligations of Realogy Group and mature in January 2020. The First and a Half Lien Notes bear interest at a rate of 9.00% per annum and interest is payable semiannually on January 15 and July 15 of each year. The First and a Half Lien Notes are guaranteed on a senior secured basis by Realogy Intermediate and each domestic subsidiary of Realogy Group that is a guarantor under the Senior Secured Credit Facility and Realogy Group's outstanding debt securities. The First and a Half Lien Notes are also guaranteed by Realogy Holdings, on an unsecured senior subordinated basis. The First and a Half Lien Notes are secured by the same collateral as the Company’s existing secured obligations under its Senior Secured Credit Facility and the new Term Loan A Facility. The priority of the collateral liens securing the First and a Half Lien Notes is junior to the collateral liens securing the Company’s first lien obligations under its Senior Secured Credit Facility and Term Loan A Facility. See Note 11, "Subsequent Events" for a discussion of the Company's issuance of a notice of redemption to use cash on hand and revolver borrowings to repay the First and a Half Lien Notes on November 30, 2015. Unsecured Notes The 3.375% Senior Notes, 4.50% Senior Notes and 5.25% Senior Notes (collectively the "Unsecured Notes") are unsecured senior obligations of Realogy Group that mature on May 1, 2016, April 15, 2019 and December 1, 2021, respectively. Interest on the Unsecured Notes is payable each year semiannually on May 1 and November 1 for the 3.375% Senior Notes, April 15 and October 15 for the 4.50% Senior Notes and June 1 and December 1 for the 5.25% Senior Notes. The Unsecured Notes are guaranteed on an unsecured senior basis by each domestic subsidiary of Realogy Group that is a guarantor under the Senior Secured Credit Facility and Realogy Group's outstanding debt securities. The Unsecured Notes are guaranteed by Realogy Holdings on an unsecured senior subordinated basis. Other Debt Facilities The Company has an Unsecured Letter of Credit Facility to provide for the issuance of letters of credit required for general corporate purposes by the Company. In August 2015, the Company increased the capacity of the facility by $7 million from $81 million as of December 31, 2014 to $88 million. $27 million of capacity of the unsecured letter of credit facility expires in June 2017, $54 million of capacity expires in August 2017 and the remaining $7 million of capacity expires in September 2018. The fixed pricing to the Company is based on a spread above the credit default swap rate for senior unsecured debt obligations of the Company over the applicable letter of credit period. Realogy Group's obligations under the Unsecured Letter of Credit Facility are guaranteed on an unsecured senior basis by each domestic subsidiary of Realogy Group that is a guarantor under the Senior Secured Credit Facility and Realogy Group's outstanding debt securities. As of September 30, 2015, $82 million of the Facility is being utilized. Securitization Obligations Realogy Group has secured obligations through Apple Ridge Funding LLC under a securitization program. In June 2015, Realogy Group extended the program until June 2016 and temporarily increased the capacity under the facility from $325 million to $375 million from June 2015 until October 2015, at which time the capacity was reduced to $325 million. At September 30, 2015, Realogy Group has $325 million of outstanding borrowings under the facility. Realogy Group, through a special purpose entity known as Cartus Financing Limited, has agreements providing for a £20 million revolving loan facility and a £5 million working capital facility, both of which expire in August 2016. There are $10 million of outstanding borrowings on the facilities at September 30, 2015. These Cartus Financing Limited facilities are secured by the relocation assets of a U.K. government contract in this special purpose entity and are therefore classified as permitted securitization financings as defined in Realogy Group’s Senior Secured Credit Facility and the indentures governing the Unsecured Notes and the First and a Half Lien Notes. The Apple Ridge entities and the Cartus Financing Limited entity are consolidated special purpose entities that are utilized to securitize relocation receivables and related assets. These assets are generated from advancing funds on behalf of clients of Realogy Group’s relocation business in order to facilitate the relocation of their employees. Assets of these special purpose entities are not available to pay Realogy Group’s general obligations. Under the Apple Ridge program, provided no termination or amortization event has occurred, any new receivables generated under the designated relocation management agreements are sold into the securitization program and as new eligible relocation management agreements are entered into, the new agreements are designated to the program. The Apple Ridge program has restrictive covenants and trigger events, including performance triggers linked to the age and quality of the underlying assets, foreign obligor limits, multicurrency limits, financial reporting requirements, restrictions on mergers and change of control, any uncured breach of Realogy Group’s senior secured leverage ratio under Realogy Group’s Senior Secured Credit Facility, and cross-defaults to Realogy Group’s material indebtedness. The occurrence of a trigger event under the Apple Ridge securitization facility could restrict our ability to access new or existing funding under this facility or result in termination of the facility, either of which would adversely affect the operation of our relocation business. Certain of the funds that Realogy Group receives from relocation receivables and related assets must be utilized to repay securitization obligations. These obligations were collateralized by $338 million and $286 million of underlying relocation receivables and other related relocation assets at September 30, 2015 and December 31, 2014, respectively. Substantially all relocation related assets are realized in less than twelve months from the transaction date. Accordingly, all of Realogy Group’s securitization obligations are classified as current in the accompanying Condensed Consolidated Balance Sheets. Interest incurred in connection with borrowings under these facilities amounted to $1 million and $4 million for the three and nine months ended September 30, 2015, respectively and $1 million and $4 million for the three and nine months ended September 30, 2014, respectively. This interest is recorded within net revenues in the accompanying Condensed Consolidated Statements of Operations as related borrowings are utilized to fund Realogy Group's relocation business where interest is generally earned on such assets. These securitization obligations represent floating rate debt for which the average weighted interest rate was 2.0% and 2.4% for the nine months ended September 30, 2015 and 2014, respectively. Loss on the Early Extinguishment of Debt and Write-Off of Deferred Financing Costs As a result of refinancing activity and repurchases of debt during the first half of 2014, the Company recorded a loss on the early extinguishment of debt of $27 million and wrote off deferred financing costs of $3 million to interest expense during the nine months ended September 30, 2014.

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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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