Notes to Consolidated Financial Statements 57
terms.  Also in 2004, the Company issued $550 million of 6.75% senior notes due
2012 through a Rule 144A offering which were subsequently exchanged for regis-
tered notes with identical terms. Also in 2004, the Company issued $450 million of
6% senior notes due 2009 through a Rule 144A offering which were subsequently
exchanged for registered notes with identical terms. The proceeds of the above offer-
ings were used to reduce outstanding borrowings under the Senior Credit Facility.
In August 2003, the Company’s Board of Directors authorized the repurchase of up to
$100 million of the Company’s public debt securities. Subsequently, the Company
repurchased $25 million of its senior notes. The Company recorded a loss of $3 mil-
lion related to repurchase premiums and unamortized debt issue costs. In 2004, the
Company repurchased an additional $49 million of its senior notes for $52 million.
This resulted in a loss on early retirement of debt of $6 million, including the write-off
of unamortized original issue discount, classified as “other, net” in the accompanying
consolidated statements of income. In December 2004, the Company’s Board of
Directors renewed its authorization for up to $100 million of additional debt securities.
The Company established a commercial paper program during 2001 that provides for
the issuance, on a revolving basis, of up to $500 million of uncollateralized short-term
notes. The Company is required to maintain credit availability under its Senior Credit
Facility equal to the outstanding principal amount of commercial paper borrowings.
No commercial paper borrowings were outstanding at December 31, 2004 or 2003.
The Company attempts to limit its exposur e to interest rate risk by managing the
mix of its long-term fixed rate borrowings and short-term borrowings under its
bank credit facilities. In 2003, the Company entered into three interest rate swap
agreements, designated as fair value hedges, which effectively converted 
$400 million of the Company’s fixed rate debt to floating rate debt. I n 2004, the
Company terminated interest rate swap agreements with total notional amounts of
$400 million and entered into additional interest rate swap agreements, designated
as fair value hedges, with total notional amounts of $100 million, leaving interest
rate swap agreements with total notional amounts of $100 million remaining as of
December 31, 2004. At December 31, 2004, the fair value of the interest rate swap
agreements was a liability of $0.1 million. 
Under the terms of the interest rate swap agreements, the Company makes 
payments based on specified spreads over six-month LIBOR, and receives payments
equal to the interest payments due on the fixed rate debt. The interest rate swap
agreements qualify for the “shortcut method” allowed under Statement of Financial
Accounting Standards No. 133, which allows an assumption of no ineffectiveness in
the hedging relationship. As such, there is no income statement impact from
changes in the fair value of the hedging instruments. Instead, the fair value of the
instruments is recorded as an asset or liability on the Company’s balance sheet, with
an offsetting adjustment to the carrying value of the related debt.  The Company
received $5 million upon termination of swap agreements in 2004, which has been
added to the carrying value of the related debt obligations and is being amortized
and recorded as a reduction of interest expense over the remaining life of that debt. 
During 2001 and 2002, the Company enter ed into several interest rate swap 
agreements, designated as fair value hedges, which effectively converted a portion of
the Company’s fixed rate debt to floating rate debt. B y the second quarter of 2002,
the Company had terminated these interest rate swap agreements. The Company
received net payments totaling $11 million during 2001 and 2002 upon the