Debt

Debt at March 31, 2015 and December 31, 2014 was as follows (in millions):



	March 31, 2015		December 31, 2014
Allegheny Technologies 5.875% Notes due 2023 (a)	$	500.0	$	500.0
Allegheny Technologies 5.95% Notes due 2021	500.0		500.0
Allegheny Technologies 9.375% Notes due 2019	350.0		350.0
Allegheny Ludlum 6.95% debentures due 2025	150.0		150.0
ATI Ladish Series B 6.14% Notes due 2016 (b)	11.7		11.9
ATI Ladish Series C 6.41% Notes due 2015 (c)	10.2		10.3
Domestic Bank Group $400 million credit facility	—		—
Foreign credit facilities	—		—
Industrial revenue bonds, due through 2020, and other	5.1		4.7
Total short-term and long-term debt	1,527.0		1,526.9
Short-term debt and current portion of long-term debt	17.9		17.8
Total long-term debt	$	1,509.1	$	1,509.1


(a)	Bearing interest at 6.375% effective February 15, 2015.


(b)	Includes fair value adjustments of $0.3 million at March 31, 2015 and $0.4 million at December 31, 2014.


(c)	Includes fair value adjustments of $0.2 million at March 31, 2015 and $0.3 million at December 31, 2014.

During the first quarter of 2015, Standard & Poor’s (“S&P”) downgraded the Company’s credit rating one notch to BB+ from BBB-, resulting in an increase of the interest rate on the Senior Notes due 2023 (the “2023 Notes”) from 6.125% as of December 31, 2014 to 6.375% effective with the interest period beginning February 15, 2015. Future downgrades of the Company’s credit ratings could result in additional increases to the interest cost with respect to the 2023 Notes.

There were no outstanding borrowings made under the Company’s $400 million senior domestic credit facility (“credit facility”) expiring May 31, 2018 as of March 31, 2015, although approximately $4.7 million has been utilized to support the issuance of letters of credit. Average borrowings under the credit facility for the first quarter of 2015 were $73.7 million, bearing an average annual interest rate of 1.9%. The credit facility provides for a springing lien on certain of the Company’s accounts receivable and inventory. This springing lien became effective during the first quarter of 2015 as the Company’s credit ratings from both S&P’s and Moody’s are now below investment grade following S&P’s downgrade in the first quarter 2015 discussed above. This springing lien will be subsequently released if the Company’s credit rating returns to investment grade from either rating agency, assuming no event of default condition exists. The credit facility requires the Company to maintain a leverage ratio (measured as consolidated total indebtedness net of cash on hand in excess of $50 million, divided by consolidated EBITDA, defined as earnings before interest, taxes, depreciation and amortization, and non-cash pension expense, with the definition of consolidated EBIT excluding any gain or loss attributable to sale or other dispositions of assets outside the ordinary course of business, for the four prior fiscal quarters) of not greater than 5.00 for the quarter ended March 31, 2015, 4.50 for the quarter ended June 30, 2015, 3.75 for the quarter ended September 30, 2015, and 3.50 for the quarter ended December 31, 2015 and for each fiscal quarter thereafter. The credit facility also requires the Company to maintain an interest coverage ratio (consolidated EBITDA as calculated for the leverage ratio, divided by interest expense) of not less than 2.50 for the quarter ended March 31, 2015, 3.00 for the quarter ended June 30, 2015, 3.25 for the quarter ended September 30, 2015, and 3.50 for the quarter ended December 31, 2015 and for each fiscal quarter thereafter. At March 31, 2015, the leverage ratio was 3.73 and the interest coverage ratio was 3.26. The Company was in compliance with these required ratios during all applicable periods.

The Company has an additional separate credit facility for the issuance of letters of credit. As of March 31, 2015, $32 million in letters of credit were outstanding under this facility.

In addition, Shanghai STAL Precision Stainless Steel Company Limited (STAL), the Company’s Chinese joint venture company in which ATI has a 60% interest, entered into a 125 million renminbi (approximately $20 million at March 31, 2015 exchange rates) revolving credit facility in April 2015, replacing a previous revolving credit facility that expired in 2014. Borrowings may be either in renminbi or U.S. dollars, with interest rates based on published Chinese or U.S. interbank offer rates, respectively. The credit facility is supported solely by STAL’s financial capability without any guarantees from the joint venture partners. The credit facility requires STAL to maintain a minimum level of shareholders’ equity, and certain financial ratios.

The ATI Ladish Series B and Series C Notes are guaranteed by ATI and are equally ranked with all of ATI’s existing and future senior unsecured debt.