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Debt | 12 Months Ended
--- | ---
Dec. 31, 2017
Debt Disclosure [Abstract] |
Debt | Debt Total debt, net of debt issuance costs, is summarized in the following table ($ in millions):
| December 31, 2017 |  | December 31, 2016
Term loan A-1 | $ | 60.0 |  |  | $ | 60.0 |
Term loan A-2 | 244.4 |  |  | 246.9 |
Revolving credit agreement - U.S. dollar borrowings | 344.5 |  |  | 131.0 |
Revolving credit agreement - Euro borrowings | 26.4 |  |  | — |
French employee profit sharing | 9.1 |  |  | 9.5 |
Long-term capital lease obligations | 4.1 |  |  | — |
Other | 1.5 |  |  | — |
Debt issuance costs | (5.8 | ) |  | (7.0 | )
Total debt | 684.2 |  |  | 440.4 |
Less: Current debt | (5.1 | ) |  | (3.0 | )
Long-term debt | $ | 679.1 |  |  | $ | 437.4 |
Credit Agreement On December 1, 2016, the Company entered into the First Amendment to Second Amended and Restated Credit Agreement ("First Amendment") with JPMorgan Chase Bank, N.A. as administrative agent. Under the terms of the First Amendment, and effective upon the closing of the Conwed acquisition on January 20, 2017, the Company's maximum net debt to EBITDA ratio, as defined in the First Amendment, calculated on a trailing four fiscal quarter basis, is required to be not greater than 4.25 at December 31, 2017, reducing to 4.00 after December 31, 2017, 3.75 after March 31, 2018, 3.50 after June 30, 2018 and 3.00 after December 31, 2018. On October 28, 2015 Schweitzer-Mauduit International, Inc. entered into a Second Amended and Restated Credit Agreement, or the Amended Credit Agreement, with JPMorgan Chase Bank, N.A., as administrative agent, providing for credit facilities in the aggregate principal amount of $1 billion, consisting of a $650 million revolving credit facility, or Revolving Credit Facility available to the Company; a $100 million Term Loan A-1 (“Term Loan A-1”) made to the Company; and a $250 million Term Loan A-2 (“Term Loan A-2” and, together with Term Loan A-1, the “Term Loans”) made to the Company. The Revolving Credit Facility matures on October 28, 2020. The Term Loan A-1 amortizes at the rate of 5.0% for the first two years, at the rate of 10.0% for the final three years and matures on October 28, 2020. The Term Loan A-2 amortizes at the rate of 1.0% per year and matures on October 28, 2022. The Term Loans are generally subject to mandatory repayment out of the net cash proceeds of asset sales which are not reinvested in operating assets. The credit facilities are secured by substantially all of the personal property of the Company and its domestic subsidiaries. In December 2015, the Company prepaid the full amount of amortization for Term Loan A-1, which totaled $40 million. The interest rate margins applicable to the Revolving Credit Facility and the Term Loans under the Amended Credit Agreement are based on a fluctuating rate of interest measured by reference to either, at the Company's option, (i) a base rate, plus an applicable margin, which ranges from 0.25% to 1.50%, in the case of the Revolving Credit Facility and Term Loan A-1, and from 0.50% to 1.75%, in the case of Term Loan A-2, or (ii) an adjusted London interbank offered rate (adjusted for maximum reserves) (“LIBOR”), plus an applicable margin, which ranges from 1.25% to 2.50%, in the case of the Revolving Credit Facility and Term Loan A-1, and from 1.50% to 2.75%, in the case of Term Loan A-2. The applicable margin, in each case, is adjusted from time to time based on the Company's ratio of net debt to EBITDA as defined by the Amended Credit Agreement. As of December 31, 2017, the average applicable interest rate on Amended Credit Agreement borrowings was 3.60% on US Revolving Credit Facility borrowings, 2.00% on Euro Revolving Credit Facility borrowings, 3.63% on Term Loan A-1 borrowings and 3.88% on Term Loan A-2 borrowings. The Amended Credit Agreement also contains representations and warranties which are customary for facilities of this type. The Company was in compliance with all of its covenants under the Amended Credit Agreement at December 31, 2017. French Employee Profit Sharing At both December 31, 2017 and 2016, long-term debt other than the Amended Credit Agreement primarily consisted of obligations of the French operations related to government-mandated profit sharing. Each year, representatives of the workers at each of the French businesses can make an election for the profit sharing amounts from the most recent year ended to be invested in a financial institution or with their respective employer. To the extent that funds are invested with the Company, these amounts bear interest at 1.15% and 0.80% at December 31, 2017 and 2016, respectively, and are generally payable in the fifth year subsequent to the year in which the profit sharing is accrued. Bank Overdrafts The Company also had bank overdraft facilities of $20.0 million and $27.3 million, at December 31, 2017 and 2016, respectively, of which none was outstanding at either December 31, 2017 or 2016. Interest is incurred on outstanding amounts at market rates and was 0.24% and 0.14%, respectively, at December 31, 2017 and 2016. No commitment fees are paid on the unused portion of these facilities. Rate Swap Agreements The Company maintained a forward interest rate swap agreement on a portion of its long-term debt as of December 31, 2017 that will fix the LIBOR rate on $50.0 million of the Company's variable-rate long-term debt as of October 2014 at a predetermined rate plus a credit spread through the end of October 2018. See Note 14. Derivatives for more information. On January 20, 2017, the Company entered into an interest rate swap transaction with a major financial institution for a three-year term on a notional amount of $315 million. The interest rate swap is intended to manage the Company's interest rate risk by fixing the interest rate on a portion of the Company's debt currently outstanding under its credit facility that was previously subject to a floating interest rate equal to 1-month LIBOR plus a credit spread. The swap provides for the Company to pay a fixed rate of 1.65% per annum in addition to the credit spread on such portion of its outstanding debt in exchange for receiving a variable interest rate based on 1-month LIBOR. On January 20, 2017, the Company also entered into a three-year cross-currency swap with a major financial institution designated as a hedge of a portion of the Company's net investment in certain Euro-denominated subsidiaries. The terms of the cross-currency swap provide for an exchange of principal on a notional amount of $100 million swapped to €93.7 million at maturity. The Company will receive from our swap counterparty U.S. dollar interest at a fixed rate of 1.65% per annum and pay to our swap counterparty Euro interest at a fixed rate of -0.18% per annum. Principal Repayments Under the Amended Credit Agreement, the Company selects an "interest period" for each of its borrowings from the Revolving Credit Facility. The Company can repay such borrowings and borrow again at a subsequent date if it chooses to do so, providing it flexibility and efficient use of any excess cash. The Company currently has the intent and ability to allow its debt balances to remain outstanding and expects to continue to file notices of continuation related to its borrowings outstanding at December 31, 2017 such that those amounts are not expected to be repaid prior to the December 2020 expiration of the Revolving Credit Facility. Following are the expected maturities for the Company's debt obligations as of December 31, 2017 ($ in millions):
2018 | $ | 6.9 |
2019 | 5.2 |
2020 | 434.6 |
2021 | 4.4 |
2022 | 236.0 |
Thereafter | 2.9 |
Total | $ | 690.0 |
Fair Value of Debt At December 31, 2017 and 2016, the estimated fair values of the Company's current and long-term debt approximated the respective carrying amounts, as the interest rates were variable and based on current market indices. Debt Issuance Costs In conjunction with the First Amendment, the Company capitalized approximately $0.6 million in deferred debt issuance costs which will be amortized over the term of the related debt instruments. In conjunction with the Amended Credit Agreement, the Company capitalized approximately $7.4 million, in the fourth quarter of 2015, in deferred debt issuance costs associated with the new facility which will be amortized over the term of the related debt instruments. As of December 31, 2017 and 2016, the Company's total deferred debt issuance costs totaled $5.8 million and $7.0 million, respectively. Amortization expense of $1.8 million and $1.7 million was recorded during the years ended December 31, 2017 and 2016, respectively, and has been included as a component of Interest Expense in the accompanying Consolidated Statements of Income. Following is the expected future amortization of the Company's deferred debt issuance costs as of December 31, 2017 ($ in millions):
2018 | $ | 1.8 |
2019 | 1.8 |
2020 | 1.6 |
2021 | 0.3 |
2022 | 0.3 |
Total | $ | 5.8 |

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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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