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Short And Long Term-Debt | 3 Months Ended
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Mar. 31, 2018
Debt Disclosure [Abstract] |
Short And Long-Term Debt | SHORT AND LONG-TERM DEBT Total indebtedness is as follows:
| March 31, 2018 |  | December 31, 2017
Senior Secured Credit Facility: |  |  |
Revolving Credit Facility | $ | 302 |  |  | $ | 70 |
Term Loan B (1) | 1,060 |  |  | 1,063 |
Term Loan A Facility: |  |  |
Term Loan A (1) | 745 |  |  | 390 |
Term Loan A-1 | — |  |  | 339 |
4.50% Senior Notes | 445 |  |  | 444 |
5.25% Senior Notes | 546 |  |  | 546 |
4.875% Senior Notes | 497 |  |  | 496 |
Total Short-Term & Long-Term Debt | $ | 3,595 |  |  | $ | 3,348 |
Securitization Obligations: |  |  |
Apple Ridge Funding LLC | $ | 170 |  |  | $ | 181 |
Cartus Financing Limited | 14 |  |  | 13 |
Total Securitization Obligations | $ | 184 |  |  | $ | 194 |
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(1) | As of March 31, 2018, after giving effect to the February 2018 refinancing transactions discussed in this Note 5 under the headings "Senior Secured Credit Facility" and "Term Loan A Facility."
Indebtedness Table As of March 31, 2018, the Company’s borrowing arrangements were as follows:
| Interest Rate |  | Expiration Date |  | Principal Amount |  | Unamortized Discount and Debt Issuance Costs |  | Net Amount
Senior Secured Credit Facility: |  |  |  |  |  |  |  |  |
Revolving Credit Facility (1) | (2) |  | February 2023 |  | $ | 302 |  |  | $ * |  |  | $ | 302 |
Term Loan B | (3) |  | February 2025 |  | 1,077 |  |  | 17 |  |  | 1,060 |
Term Loan A Facility: |  |  |  |  |  |  |  |  |
Term Loan A | (4) |  | February 2023 |  | 750 |  |  | 5 |  |  | 745 |
Senior Notes | 4.50% |  | April 2019 |  | 450 |  |  | 5 |  |  | 445 |
Senior Notes | 5.25% |  | December 2021 |  | 550 |  |  | 4 |  |  | 546 |
Senior Notes | 4.875% |  | June 2023 |  | 500 |  |  | 3 |  |  | 497 |
Securitization obligations: (5) |  |  |  |  |  |  |  |  |
Apple Ridge Funding LLC (6) |  |  | June 2018 |  | 170 |  |  | * |  |  | 170 |
Cartus Financing Limited (7) |  |  | August 2018 |  | 14 |  |  | * |  |  | 14 |
Total (8) | $ | 3,813 |  |  | $ | 34 |  |  | $ | 3,779 |
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* | The debt issuance costs related to our Revolving Credit Facility and securitization obligations are classified as a deferred financing asset within other assets.
(1) | As of March 31, 2018, the Company had $1,400 million of borrowing capacity under its Revolving Credit Facility, leaving $1,098 million of available capacity. The Revolving Credit Facility expires in February 2023, but is classified on the balance sheet as current due to the revolving nature of the facility. On May 1, 2018, the Company had $372 million in outstanding borrowings under the Revolving Credit Facility, leaving $1,028 million of available capacity.
(2) | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at March 31, 2018 were based on, at the Company's option, (a) adjusted London Interbank Offering Rate ("LIBOR") plus an additional margin or (b) JP Morgan Chase Bank, N.A.'s prime rate ("ABR") plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018.
(3) | The Term Loan B provides for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) ABR plus 1.25% (with an ABR floor of 1.75%).
(4) | The Term Loan A provides for quarterly amortization payments, which commence on June 30, 2018, totaling per annum 2.5%, 2.5%, 5.0%, 7.5% and 10.0% of the original principal amount of the Term Loan A, with the last amortization payment to be made on February 8, 2023. The interest rates with respect to term loans under the Term Loan A are based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018.
(5) | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations.
(6) | As of March 31, 2018, the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $80 million of available capacity.
(7) | Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of March 31, 2018, the Company had $21 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity.
(8) | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $66 million utilized at a weighted average rate of 3.24% at March 31, 2018.
Maturities Table As of March 31, 2018, the combined aggregate amount of maturities for long-term borrowings, excluding securitization obligations, for the remainder of 2018 and each of the next four years is as follows:
Year |  | Amount
Remaining 2018 (a) |  | $ | 324 |
2019 |  | 480 |
2020 |  | 44 |
2021 |  | 613 |
2022 |  | 81 |
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(a) | The current portion of long-term debt consists of remaining 2018 amortization payments totaling $14 million and $8 million for the Term Loan A and Term Loan B facilities, respectively, as well as $302 million of revolver borrowings under the Revolving Credit Facility which expires in February 2023, but are classified on the balance sheet as current due to the revolving nature of the facility.
Senior Secured Credit Facility In February 2018, the Company entered into fifth and sixth amendments to the Amended and Restated Senior Secured Credit Agreement dated as of March 5, 2013 (as amended, amended and restated, modified or supplemented from time to time, the "Senior Secured Credit Agreement") that respectively (i) replaced the approximately $1,100 million Term Loan B due July 2022 with a new $1,080 million Term Loan B due February 2025 and (ii) increased the borrowing capacity under its Revolving Credit Facility to $1,400 million from the prior $1,050 million and extended the maturity date to February 2023 from October 2020. The Senior Secured Credit Agreement provides for:
(a) | the Term Loan B issued in the original aggregate principal amount of $1,080 million with a maturity date of February 2025. The Term Loan B has quarterly amortization payments totaling 1% per annum of the initial aggregate principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at Realogy Group's option, adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or ABR plus 1.25% (with an ABR floor of 1.75%); and
(b) | a $1,400 million Revolving Credit Facility with a maturity date of February 2023, which includes a $125 million letter of credit subfacility. The interest rate with respect to revolving loans under the Revolving Credit Facility is based on, at Realogy Group's option, adjusted LIBOR or ABR plus an additional margin subject to the following adjustments based on the Company’s then current senior secured leverage ratio:
Senior Secured Leverage Ratio |  | Applicable LIBOR Margin |  | Applicable ABR Margin
Greater than 3.50 to 1.00 |  | 2.50% |  | 1.50%
Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 |  | 2.25% |  | 1.25%
Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 |  | 2.00% |  | 1.00%
Less than 2.00 to 1.00 |  | 1.75% |  | 0.75%
The Senior Secured 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 Senior Secured Credit Agreement also permits us to issue senior secured or unsecured notes in lieu of any incremental facility. The obligations under the Senior Secured 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 Senior Secured Credit Agreement contains financial, affirmative and negative covenants and requires Realogy Group to maintain (so long as the Revolving Credit Facility is outstanding) a senior secured leverage ratio, not to exceed 4.75 to 1.00. The leverage ratio is tested quarterly regardless of the amount of borrowings outstanding and letters of credit issued under the revolver at the testing date. Total senior secured net debt does not include unsecured indebtedness, including the Unsecured Notes as well as the securitization obligations. At March 31, 2018, Realogy Group was in compliance with the senior secured leverage ratio covenant. Term Loan A Facility In February 2018, Realogy Group entered into a second amendment to the Term Loan A senior secured credit agreement. Under the amendment, the Company aggregated the existing $435 million Term Loan A and $355 million Term Loan A-1 tranches due October 2020 and July 2021, respectively, into a new single tranche of $750 million Term Loan A due February 2023. The Term Loan A provides for quarterly amortization payments totaling per annum 2.5%, 2.5%, 5.0%, 7.5% and 10.0% of the original principal amount of the Term Loan A, which commence on June 30, 2018 and continue through February 8, 2023. The interest rates with respect to the Term Loan A are based on, at our option, adjusted LIBOR or ABR plus an additional margin subject to the following adjustments based on the Company’s then current senior secured leverage ratio:
Senior Secured Leverage Ratio |  | Applicable LIBOR Margin |  | Applicable ABR Margin
Greater than 3.50 to 1.00 |  | 2.50% |  | 1.50%
Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 |  | 2.25% |  | 1.25%
Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 |  | 2.00% |  | 1.00%
Less than 2.00 to 1.00 |  | 1.75% |  | 0.75%
Consistent with the Senior Secured Credit Agreement, the Term Loan A Facility permits the Company to obtain up to $500 million of additional credit facilities from lenders reasonably satisfactory to the administrative agent and the company, without the consent of the existing lenders under the Term Loan A, plus an unlimited amount if the Company's senior secured leverage ratio is less than 3.50 to 1.00 on a pro forma basis. Subject to certain restrictions, the Term Loan A Facility also permits us to issue senior secured or unsecured notes in lieu of any incremental facility. Unsecured Notes The 4.50% Senior Notes, 5.25% Senior Notes and 4.875% Senior Notes (collectively the "Unsecured Notes") are unsecured senior obligations of Realogy Group that mature on April 15, 2019, December 1, 2021 and June 1, 2023, respectively. Interest on the Unsecured Notes is payable each year semiannually on April 15 and October 15 for the 4.50% Senior Notes and June 1 and December 1 for both the 5.25% Senior Notes and 4.875% 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 and are guaranteed by Realogy Holdings on an unsecured senior subordinated basis. The indentures governing the Unsecured Notes contain affirmative and negative covenants of Realogy Group and the subsidiary guarantors. 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. At March 31, 2018, the capacity of the facility was $74 million with $66 million being utilized and at December 31, 2017, the capacity of the facility was $74 million with $69 million being utilized. The facility's expiration dates are as follows:
Capacity (in millions) | Expiration Date
$8 | September 2018
$66 | December 2019
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. Securitization Obligations Realogy Group has secured obligations through Apple Ridge Funding LLC under a securitization program. The program expires in June 2018 and has a capacity of $250 million. At March 31, 2018, Realogy Group had $170 million of outstanding borrowings under the facility. Realogy Group, through a special purpose entity known as Cartus Financing Limited, has agreements providing for a £10 million revolving loan facility and a £5 million working capital facility, both of which expire in August 2018. There were $14 million of outstanding borrowings on the facilities at March 31, 2018. 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. 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 $239 million and $218 million of underlying relocation receivables and other related relocation assets at March 31, 2018 and December 31, 2017, 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 $2 million and $1 million for the three months ended March 31, 2018 and 2017, 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 3.6% and 3.3% for the three months ended March 31, 2018 and 2017, respectively. Loss on the Early Extinguishment of Debt and Write-Off of Financing Costs As a result of the refinancing transactions in February 2018, the Company recorded a loss on the early extinguishment of debt of $7 million and wrote off financing costs of $2 million to interest expense during the three months ended March 31, 2018. As a result of a refinancing transaction completed in January 2017, the Company recorded a loss on the early extinguishment of debt of $4 million during the three months ended March 31, 2017.

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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 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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