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10-Q
XPO LOGISTICS, INC. filed this Form 10-Q on 11/05/2018
Entire Document
 

5. Debt
The Company’s debt is comprised of the following:
 
 
September 30, 2018
 
December 31, 2017
(In millions)
 
Principal Balance
 
Carrying Value
 
Principal Balance
 
Carrying Value
ABL facility
 
$

 
$

 
$
100.0

 
$
100.0

Term loan facility
 
1,503.0

 
1,472.6

 
1,494.0

 
1,455.6

6.125% Senior notes due 2023
 
535.0

 
528.7

 
535.0

 
528.0

6.50% Senior notes due 2022
 
1,200.0

 
1,189.1

 
1,600.0

 
1,583.0

6.70% Senior debentures due 2034
 
300.0

 
204.5

 
300.0

 
202.8

4.00% Euro private placement notes due 2020
 
13.9

 
14.6

 
14.4

 
15.3

Trade Securitization Program
 
364.5

 
361.5

 
302.6

 
298.6

Asset financing
 
51.5

 
51.5

 
90.0

 
90.0

Capital leases for equipment
 
266.8

 
266.8

 
247.9

 
247.9

Total debt
 
4,234.7

 
4,089.3

 
4,683.9

 
4,521.2

Current maturities of long-term debt
 
84.0

 
84.0

 
103.7

 
103.7

Long-term debt
 
$
4,150.7

 
$
4,005.3

 
$
4,580.2

 
$
4,417.5

The fair value of the Company’s debt at September 30, 2018 was $4,315.2 million, of which $2,156.1 million was classified as Level 1 and $2,159.1 million was classified as Level 2 in the fair value hierarchy. The fair value of the debt at December 31, 2017 was $4,816.1 million, of which $2,647.4 million was classified as Level 1 and $2,168.7 million was classified as Level 2. The Level 1 debt was valued using quoted prices in active markets. The Level 2 debt was valued using bid evaluation pricing models or quoted prices of securities with similar characteristics. The fair value of the asset financing arrangements approximates carrying value since the debt is primarily issued at a floating rate, may be prepaid any time at par without penalty, and the remaining life is short-term in nature.
ABL Facility
In October 2015, the Company entered into the Second Amended and Restated Revolving Loan Credit Agreement (the “ABL Facility”) which was amended in March 2018 to allow letters of credit to be issued in currencies other than USD and Canadian dollars. At September 30, 2018, the Company had a borrowing base of $935.4 million and availability under the ABL Facility of $697.2 million after considering outstanding letters of credit on the ABL Facility of $238.2 million. As of September 30, 2018, the Company was in compliance with the ABL Facility’s financial covenants.
Refinancing of Existing Term Loans
In February 2018, the Company entered into a Refinancing Amendment (Amendment No. 3 to Credit Agreement) (the “Third Amendment”), by and among XPO, its subsidiaries signatory thereto, as guarantors, the lenders party thereto and Morgan Stanley Senior Funding, Inc., in its capacity as administrative agent, amending that certain Senior Secured Term Loan Credit Agreement, dated as of October 30, 2015 (as amended, amended and restated, supplemented or otherwise modified, including by that certain Incremental and Refinancing Amendment (Amendment No. 1 to Credit Agreement), dated as of August 25, 2016, and by that certain Refinancing Amendment (Amendment No. 2 to Credit Agreement), dated March 10, 2017, the “Term Loan Credit Agreement”).
Pursuant to the Third Amendment, the outstanding $1,494.0 million principal amount of term loans under the Term Loan Credit Agreement (the “Existing Term Loans”) were replaced with $1,503.0 million in aggregate principal amount of new term loans (the “New Term Loans”) having substantially similar terms as the Existing Term Loans, except with respect to the interest rate and maturity date applicable to the New Term Loans, prepayment premiums in connection with certain voluntary prepayments and certain other amendments to the restrictive covenants. Proceeds from the New Term Loans were used to refinance the Existing Term Loans and to pay interest, fees and expenses in connection therewith.


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