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Long-Term Debt | 12 Months Ended
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Dec. 31, 2015
Debt Disclosure [Abstract] |
Long-Term Debt |
| 13. |  | LONG-TERM DEBT
Long-term debt consisted of the following:
|  | December 31, 2015 |  |  | December 31, 2014 |
Funding program loans from European Investment Bank: |  |  |  |  |  |  |  |
0.30% due 2015, floating interest rate at Libor + 0.026% |  |  | — |  |  |  | 9 |
0.38% due 2016, floating interest rate at Libor + 0.052% |  |  | 19 |  |  |  | 39 |
1.08% due 2016, floating interest rate at Libor + 0.477% |  |  | 26 |  |  |  | 52 |
0.71% due 2016, floating interest rate at Libor + 0.373% |  |  | 29 |  |  |  | 57 |
1.52% due 2020, floating interest rate at Libor + 1.199% |  |  | 63 |  |  |  | 75 |
1.51% due 2020, floating interest rate at Libor + 1.056% |  |  | 138 |  |  |  | 165 |
0.86% due 2020, floating interest rate at Euribor + 0.917% |  |  | 68 |  |  |  | 91 |
1.06% due 2021, floating interest rate at Libor + 0.525% |  |  | 180 |  |  |  | 210 |
1.22% due 2021, floating interest rate at Libor + 0.572% |  |  | 173 |  |  |  | 202 |
Dual tranche senior unsecured convertible bonds |  |  |  |  |  |  |  |
Zero-coupon, due 2019 (Tranche A) |  |  | 550 |  |  |  | 537 |
1.0% due 2021 (Tranche B) |  |  | 354 |  |  |  | 347 |
Other funding program loans: |  |  |  |  |  |  |  |
0.41% (weighted average), due 2015-2023, fixed interest rate |  |  | 4 |  |  |  | 6 |
Other long-term loans: |  |  |  |  |  |  |  |
1.95% (weighted average), due 2017, fixed interest rate |  |  | 4 |  |  |  | 6 |
0.75% (weighted average), due 2018, fixed interest rate |  |  | 1 |  |  |  | 1 |
0.87% (weighted average), due 2020, fixed interest rate |  |  | 2 |  |  |  | 3 |
Capital leases: |  |  |  |  |  |  |  |
6.04% (weighted average), due 2015-2017, fixed interest rate |  |  | 1 |  |  |  | 1 |
Total long-term debt |  |  | 1,612 |  |  |  | 1,801 |
Less current portion |  |  | (191 | ) |  |  | (202 | )
Total long-term debt, less current portion |  |  | 1,421 |  |  |  | 1,599 |
Long-term debt is denominated in the following currencies:
|  | December 31, 2015 |  |  | December 31, 2014 |
U.S. dollar |  |  | 1,533 |  |  |  | 1,694 |
Euro |  |  | 79 |  |  |  | 107 |
Total |  |  | 1,612 |  |  |  | 1,801 |
The European Investment Bank’s loans denominated in Euros, but drawn in U.S. dollars, are classified as U.S. dollar-denominated debt. On July 3, 2014, the Company issued $1,000 million principal amount of dual tranche senior unsecured convertible bonds (Tranche A for $600 million and Tranche B for $400 million), due 2019 and 2021, respectively. Tranche A bonds were issued as zero-coupon bonds while Tranche B bonds bear a 1% per annum nominal interest, payable semi-annually. The conversion price at issuance was approximately $12 dollar, equivalent to a 30% and a 31% premium, respectively, on each tranche. The bonds are convertible by the bondholders if certain conditions are satisfied on a net-share settlement basis, except if an alternative settlement is elected by the Company. The Company can also redeem the bonds prior to their maturity in certain circumstances. The net proceeds from the bond offering were approximately $994 million, after deducting issuance costs payable by the Company. The Company intends to use the net proceeds of the offering for general corporate purposes. Proceeds were allocated between debt and equity by measuring first the liability component and then determining the equity component as a residual amount. The liability component was measured at fair value based on a discount rate adjustment technique (income approach), which corresponds to a Level 3 fair value hierarchy measurement. The fair value of the liability component at initial recognition totalled $878 million and was estimated by calculating the present value of cash flows using a discount rate of 2.40% and 3.22% (including 1% p.a. nominal interest), respectively, on each tranche, as the market rates for similar instruments with no conversion rights. Transaction costs of $6 million were allocated proportionately to the liability and the equity components. An amount of $121 million, net of allocated issuance costs of $1 million, was recorded in shareholders’ equity as the value of the conversion features of the instruments. In 2015, the Company early adopted the simplified guidance on the presentation of debt issuance costs, which consists in reporting these costs as a deduction of the carrying value of the issued debt and not as deferred charges. The new guidance was applied retrospectively, which reduced by $4 million the amount of the liability component as at December 31, 2014. The adjusted carrying value of the liability component of the issued bonds, net of debt discount and issuance costs, totaled $884 million as at December 31, 2014 instead of the $888 million previously reported. Unamortized debt discount and issuance costs totalled $95 million as at December 31, 2015 and $116 million as at December 31, 2014. Aggregate future maturities of total long-term debt (including current portion) at redemption value are as follows:
|  | December 31, 2015 |
2016 |  |  | 191 |
2017 |  |  | 116 |
2018 |  |  | 114 |
2019 |  |  | 713 |
2020 |  |  | 113 |
Thereafter |  |  | 460 |
Total |  |  | 1,707 |
The difference between the total aggregated future maturities in the preceding table and the total carrying amount of long-term debt is due to unamortized debt discount and issuance costs on the dual tranche senior unsecured convertible bonds. Credit facilities The Company had unutilized committed medium-term credit facilities with core relationship banks totalling $563 million as of December 31, 2015. The Company also has four fully drawn committed long-term amortizing credit facilities with the European Investment Bank as part of R&D funding programs. The first one, signed on December 6, 2006 for a total of €245 million for R&D in France was fully drawn in U.S. dollars for a total amount of $341 million, of which $19 million remained outstanding as at December 31, 2015. The second one, signed on July 21, 2008, for a total amount of €250 million for R&D projects in Italy, was fully drawn in U.S. dollars for $380 million, of which $55 million remained outstanding as of December 31, 2015. The third one, signed on September 27, 2010 as a €350 million multi-currency loan for R&D programs in Europe, was drawn mainly in U.S. dollars for an amount of $321 million and only partially in Euros for an amount of €100 million, of which $269 million remained outstanding as of December 31, 2015. The fourth, signed on March 12, 2013, a €350 million multi-currency loan which also supports R&D programs, was drawn in U.S. dollars for $471 million, of which $353 million was outstanding as of December 31, 2015.

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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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