Short-term and Long-term Debt

9 Months Ended

Sep. 27, 2014

Note 8: Short-term and Long-term Debt

Short-term and long-term debt as of September 27, 2014, and December 28, 2013, consisted of the following:


	September 27,			December 28,
(Amounts in millions)	2014			2013
5.85% unsecured notes due March 2014	$	—		$	100.0
5.50% unsecured notes due 2017		150.0			150.0
4.25% unsecured notes due 2018		250.0			250.0
6.70% unsecured notes due 2019		200.0			200.0
6.125% unsecured notes due 2021		250.0			250.0
Other debt*		69.2			22.0

		919.2			972.0
Less: notes payable and current maturities of long-term debt		(58.7	)		(113.1	)

Total long-term debt	$	860.5		$	858.9

*	Includes fair value adjustments related to interest rate swaps.

Notes payable of $58.7 million as of September 27, 2014, included $36.7 million of commercial paper borrowings and $22.0 million of other notes; there were no current maturities of long-term debt as of that date. As of 2013 year end, notes payable and current maturities of long-term debt of $113.1 million included $100.0 million of 5.85% unsecured notes due March 2014 (the “2014 Notes”) and $13.1 million of other notes. Snap-on repaid the 2014 Notes at maturity with available cash and commercial paper borrowings.

Snap-on has a five-year, $700 million multi-currency revolving credit facility that terminates on September 27, 2018 (the “Credit Facility”); no amounts were outstanding under the Credit Facility as of September 27, 2014. Borrowings under the Credit Facility bear interest at varying rates based on Snap-on’s then-current, long-term debt ratings. The Credit Facility’s financial covenant requires that Snap-on maintain, as of each fiscal quarter end, either (i) a ratio not greater than 0.60 to 1.00 of consolidated net debt (consolidated debt net of certain cash adjustments) to the sum of such consolidated net debt plus total equity and less accumulated other comprehensive income or loss; or (ii) a ratio not greater than 3.50 to 1.00 of such consolidated net debt to earnings before interest, taxes, depreciation, amortization and certain other adjustments for the preceding four fiscal quarters then ended. As of September 27, 2014, the company’s actual ratios of 0.28 and 1.20, respectively, were both within the permitted ranges set forth in this financial covenant.

Snap-on’s Credit Facility and other debt agreements also contains certain usual and customary borrowing, affirmative, negative and maintenance covenants. As of September 27, 2014, Snap-on was in compliance with all covenants of its Credit Facility and other debt agreements.

- 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+ Details