Debt and Credit Agreements
 6 Months Ended
Jul. 01, 2011
Debt Disclosure [Abstract]  
Debt and Credit Agreements
Debt and Credit Agreements


Total activity related to long-term debt as of the end of second quarter 2011 was as follows:
(Dollars in millions)
Current Portion
Long-term Portion
Total
Long-term debt as of December 2010
$
613


$
8,051


$
8,664


2011 activity:
 
 
 
Long-term debt issued
—


600


600


Long-term debt repaid
(570
)
—


(570
)
Reclassifications
456


(456
)
—


Debt conversions to CSX stock
(5
)
—


(5
)
Discount and premium activity
—


(9
)
(9
)
Long-term debt as of the end of second quarter 2011
$
494


$
8,186


$
8,680




 
For fair value information related to the Company's long-term debt, see Note 10, Fair Value Measurements.


NOTE 7.
Debt and Credit Agreements, continued


Debt Issuance


In May 2011, CSX issued $350 million of 4.25% notes due June 2021 and $250 million of 5.50% notes due April 2041. These notes are included in the consolidated balance sheets under long-term debt and may be redeemed by the Company at any time. The net proceeds from the sale of the notes will be used for general corporate purposes, which may include debt repayments from time to time, repurchases of CSX common stock, capital expenditures, working capital requirements, improvements in productivity and other cost reductions.


Revolving Credit Facility
    
CSX has a $1.25 billion unsecured revolving credit facility with a syndicate of banks. With the approval of the lending banks, CSX may increase its total borrowing capacity under the $1.25 billion facility by $500 million, or up to $1.75 billion. The facility allows borrowings at floating (LIBOR-based) interest rates, plus a spread, depending upon CSX's senior unsecured debt ratings. LIBOR is the London Interbank Offered Rate which is a daily reference rate based on the interest rates at which banks offer to lend unsecured funds. As of the end of second quarter 2011, this facility was not drawn on, and CSX was in compliance with all covenant requirements under the facility.  The current facility expires in May 2012 and the Company plans to renew or replace this facility prior to its expiration.


Receivables Securitization Facility


During the quarter, the Company renewed its $250 million receivables securitization facility through June 2012. This facility has a 364-day term. The purpose of this facility is to provide an alternative to commercial paper and a low cost source of short-term liquidity. As of the date of this filing, the Company has no outstanding balances under this facility. Under the terms of this facility, CSX Transportation transfers eligible third-party receivables to CSX Trade Receivables, a bankruptcy-remote special purpose subsidiary. A separate subsidiary of CSX will service the receivables. Upon transfer, the receivables become assets of CSX Trade Receivables and are not available to the creditors of CSX or any of its other subsidiaries. In the event CSX Trade Receivables draws under this facility, the Company will record an equivalent amount of debt on its consolidated financial statements.