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Long-Term Debt | 12 Months Ended
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Dec. 31, 2016
Debt Disclosure [Abstract] |
Long-Term Debt | L ONG-T ERM D EBT Long-term debt at December 31 was as follows:
| 2016 |  | 2015
| (Dollars in thousands)
Bank debt: |  |  |
Bank revolving loans | $ | 99,500 |  |  | $ | — |
U.S. term loans | 310,250 |  |  | 346,750 |
Canadian term loans | 44,274 |  |  | 47,973 |
Euro term loans | 196,668 |  |  | 227,434 |
Other foreign bank revolving and term loans | 120,500 |  |  | 103,661 |
Total bank debt | 771,192 |  |  | 725,818 |
5½% Senior Notes | 300,000 |  |  | 300,000 |
5% Senior Notes | 500,000 |  |  | 500,000 |
Total debt - principal | 1,571,192 |  |  | 1,525,818 |
Less unamortized debt issuance costs | 9,609 |  |  | 12,271 |
Total debt | 1,561,583 |  |  | 1,513,547 |
Less current portion | 217,127 |  |  | 152,398 |
| $ | 1,344,456 |  |  | $ | 1,361,149 |
A GGREGATE A NNUAL M ATURITIES The aggregate annual maturities of our debt (non-U.S. dollar debt has been translated into U.S. dollars at exchange rates in effect at the balance sheet date) are as follows (dollars in thousands):
2017 | $ | 217,127 |
2018 | 9,187 |
2019 | 2,789 |
2020 | 633,171 |
2021 | — |
Thereafter | 708,918 |
| $ | 1,571,192 |
At December 31, 2016, the current portion of our long-term debt consisted of $99.5 million of revolving loans under our senior secured credit facility, or the Credit Agreement, $5.2 million of term loans under the Credit Agreement due on December 31, 2017 and $112.4 million of foreign bank revolving and term loans. As discussed in Note 18, on February 13, 2017, we issued $300 million aggregate principal amount of the 4¾% Senior Notes due 2025, or the 4¾% Notes, and €650 million aggregate principal amount of the 3¼% Senior Notes due 2025, or the 3¼% Notes, and used a portion of the net proceeds from such issuance to prepay all outstanding Euro term loans and a portion of outstanding U.S. term loans under the Credit Agreement. Accordingly, aggregate annual maturities of such prepaid U.S. term loans and Euro term loans under the Credit Agreement were extended to 2025 for purposes of the table above to match the maturities of the 4¾% Notes and the 3¼% Notes. B ANK C REDIT A GREEMENT On January 14, 2014, we completed the refinancing of our previous senior secured credit facility, or the 2011 Credit Facility, by entering into the Credit Agreement. All amounts owed under the 2011 Credit Facility were repaid on January 14, 2014 with proceeds from the Credit Agreement, and the 2011 Credit Facility was simultaneously terminated. As a result of the refinancing of the 2011 Credit Facility, we recorded a pre-tax charge for the loss on early extinguishment of debt of $1.5 million during the first quarter of 2014. Under the Credit Agreement, we borrowed term loans and have available to us revolving loans. The term loans, or the Term Loans, provided under the Credit Agreement refinanced the term loans outstanding under the 2011 Credit Facility. The Term Loans consisted of $365 million of U.S. term loans, Cdn $70 million of Canadian term loans and €220 million of Euro term loans. The Term Loans mature on January 14, 2020, and principal on the Term Loans is required to be repaid in scheduled annual installments as provided in the Credit Agreement beginning in December 2015. The revolving loans, or the Revolving Loans, consist of a $985.6 million multicurrency revolving loan facility and a Cdn $15.0 million Canadian revolving loan facility. We may use Revolving Loans under the Credit Agreement for working capital and other general corporate purposes, including acquisitions, capital expenditures, dividends, stock repurchases and refinancing of other debt. Revolving Loans may be borrowed, repaid and reborrowed until their final maturity on January 14, 2019. At December 31, 2016, $99.5 million of revolving loans were outstanding under the Credit Agreement, and after taking into account outstanding letters of credit of $18.0 million, borrowings available under the revolving loan facilities of the Credit Agreement were $868.1 million and Cdn $15.0 million on December 31, 2016. At December 31, 2016, we had term loan borrowings outstanding under the Credit Agreement of $310.3 million, Cdn $59.5 million and €187.0 million, totaling U.S. denominated $551.2 million (with non-U.S. denominated term loans translated at exchange rates in effect at such date). At December 31, 2015, we had term loan borrowings outstanding under the Credit Agreement of $346.8 million, Cdn $66.5 million and €209.0 million, totaling U.S. denominated $622.2 million (with non-U.S. denominated term loans translated at exchange rates in effect at such date). The Credit Agreement requires us to prepay the Term Loans with proceeds received in excess of certain amounts from certain asset sales, insurance recoveries and sale and leaseback transactions. Generally, mandatory repayments of Term Loans are allocated pro rata to each of the Term Loans and applied first to the scheduled amortization payments in the year of such repayments (or, if no such payment is due in such year, to the payment due in the immediately succeeding year or the next succeeding year) and, to the extent in excess thereof, pro rata to the remaining installments of the Term Loans. Voluntary prepayments of Term Loans may be applied to any tranche of Term Loans at our discretion and are applied to the scheduled amortization payments in direct order of maturity. Amounts repaid under the Term Loans may not be reborrowed. Under the Credit Agreement, the interest rate for U.S. term loans will be either the Eurodollar Rate or the base rate under the Credit Agreement plus a margin, the interest rate for Canadian term loans will be either the CDOR Rate or the Canadian prime rate under the Credit Agreement plus a margin and the interest rate for Euro term loans will be the Euro Rate under the Credit Agreement plus a margin. Amounts outstanding under the revolving loan facilities incur interest at the same rates as the U.S. term loans in the case of U.S. dollar denominated Revolving Loans and as the Canadian term loans in the case of Canadian dollar denominated Revolving Loans. Euro and Pounds Sterling denominated Revolving Loans would incur interest at the applicable Euro Rate plus the applicable margin. At December 31, 2016, the margin for Term Loans and Revolving Loans maintained as Eurodollar Rate, CDOR Rate or Euro Rate loans was 1.50 percent and the margin for Term Loans and Revolving Loans maintained as base rate or Canadian prime rate loans was 0.50 percent. The interest rate margin on all loans will be reset quarterly based upon our Total Net Leverage Ratio as provided in the Credit Agreement. As of December 31, 2016, the interest rates on U.S. term loans, Canadian term loans and Euro term loans were 2.50 percent, 2.44 percent and 1.15 percent, respectively. The Credit Agreement provides for the payment of a commitment fee ranging from 0.20 percent to 0.35 percent per annum on the daily average unused portion of commitments available under the revolving loan facilities (0.25 percent at December 31, 2016). The commitment fee will be reset quarterly based on our Total Net Leverage Ratio as provided in the Credit Agreement. We may utilize up to a maximum of $200 million of our multicurrency revolving loan facility under the Credit Agreement for letters of credit as long as the aggregate amount of borrowings of Revolving Loans under the multicurrency revolving loan facility and letters of credit do not exceed the amount of the commitment under such multicurrency revolving loan facility. The Credit Agreement provides for payment to the applicable lenders of a letter of credit fee equal to the applicable margin in effect for Revolving Loans under the multicurrency revolving loan facility and to the issuers of letters of credit of a fronting fee of the greater of (x) $500 per annum and (y) 0.25 percent per annum, calculated on the aggregate stated amount of such letters of credit for their stated duration. For 2016, 2015 and 2014, the weighted average annual interest rate paid on term loans under our senior secured credit facilities was 1.9 percent, 1.7 percent and 1.8 percent, respectively; and the weighted average annual interest rate paid on revolving loans under our senior secured credit facilities was 2.0 percent, 1.7 percent and 1.7 percent, respectively. We have entered into interest rate swap agreements to convert interest rate exposure from variable rates to fixed rates of interest. For 2016, 2015 and 2014, the weighted average interest rate paid on term loans under our senior secured credit facilities after consideration of our interest rate swap agreements was 2.0 percent, 1.9 percent and 2.7 percent, respectively. See Note 9 which includes a discussion of our interest rate swap agreements. Pursuant to the Credit Agreement, we also have a $1.25 billion multicurrency uncommitted incremental loan facility (which amount may be increased as provided in the Credit Agreement), of which all of it may be borrowed in the form of term loans or up to $625 million of it may be borrowed in the form of revolving loans. The uncommitted multicurrency incremental loan facility provides, among other things, that any incremental term loan borrowing shall be denominated in a single currency, either U.S. dollars or certain foreign currencies; have a maturity date no earlier than the maturity date for the Term Loans; and be used for working capital and general corporate purposes, including to finance acquisitions, to refinance any indebtedness assumed as part of such acquisitions, to pay dividends, to repurchase common stock, to refinance or repurchase debt as permitted and to repay outstanding Revolving Loans. The indebtedness under the Credit Agreement is guaranteed by Silgan and its U.S., Canadian and Dutch subsidiaries. The stock of our U.S., Canadian and Dutch subsidiaries has been pledged as security to the lenders under the Credit Agreement. The Credit Agreement contains certain financial and operating covenants which limit, subject to certain exceptions, among other things, our ability to incur additional indebtedness; create liens; consolidate, merge or sell assets; make certain advances, investments or loans; enter into certain transactions with affiliates; and engage in any business other than the packaging business and certain related businesses. In addition, we are required to meet specified financial covenants consisting of Interest Coverage and Total Net Leverage Ratios, each as defined in the Credit Agreement. We are currently in compliance with all covenants under the Credit Agreement. Because we sell metal containers and closures used in the fruit and vegetable packing process, we have seasonal sales. As is common in the packaging industry, we must utilize working capital to build inventory and then carry accounts receivable for some customers beyond the packing season. Due to our seasonal requirements, which generally peak sometime in the summer or early fall, we may incur short-term indebtedness to finance our working capital requirements. O THER F OREIGN B ANK R EVOLVING A ND T ERM L OANS We have certain other bank revolving and term loans outstanding in foreign countries. At December 31, 2016, these bank revolving loans allowed for total borrowings of up to $135.2 million (translated at exchange rates in effect at the balance sheet date). These bank revolving and term loans bear interest at rates ranging from 0.5 percent to 14.6 percent. For 2016, 2015 and 2014, the weighted average annual interest rate paid on these loans was 3.8 percent, 3.7 percent and 3.9 percent, respectively. 5½ % S ENIOR N OTES In 2013, we issued $300 million aggregate principal amount of our 5½% Senior Notes due 2022, or the 5½% Notes, at 100 percent of their principal amount. The 5½% Notes are general unsecured obligations of Silgan, ranking equal in right of payment with Silgan’s unsecured unsubordinated indebtedness, including our 5% Senior Notes due 2020, and ahead of Silgan’s subordinated debt, if any. The 5½% Notes are structurally subordinated to Silgan’s secured debt to the extent of the assets securing such debt and effectively subordinated to all obligations of subsidiaries of Silgan. Interest on the 5½% Notes is payable semi-annually in cash on February 1 and August 1 of each year and the 5½% Notes mature on February 1, 2022. Net proceeds from the issuance of the 5½% Notes were used to repay outstanding bank revolving loans under the 2011 Credit Facility. The 5½% Notes are redeemable, at the option of Silgan, in whole or in part, at any time after August 1, 2017 at the following redemption prices (expressed in percentages of principal amount) plus accrued and unpaid interest thereon to the redemption date if redeemed during the twelve month period commencing August 1 of the years set forth below:
Year |  | Redemption Price
2017 |  | 102.750%
2018 |  | 101.375%
2019 and thereafter |  | 100.000%
In addition, prior to August 1, 2017, we may redeem the 5½% Notes, in whole or in part, at a redemption price equal to 100 percent of their principal amount plus a make-whole premium as provided in the indenture for the 5½% Notes, together with accrued and unpaid interest to the date of redemption. Upon the occurrence of a change of control, as defined in the indenture for the 5½% Notes, Silgan is required to make an offer to repurchase the 5½% Notes at a purchase price equal to 101 percent of their principal amount, plus accrued and unpaid interest to the date of purchase. The indenture for the 5½% Notes contains covenants which are generally less restrictive than those under the Credit Agreement and substantially similar to those under the indenture for our 5% Senior Notes due in 2020. 5% S ENIOR N OTES In 2012, we issued $500 million aggregate principal amount of our 5% Senior Notes due 2020, or the 5% Notes, at 100 percent of their principal amount. The 5% Notes are general unsecured obligations of Silgan, ranking equal in right of payment with Silgan’s unsecured unsubordinated indebtedness, including the 5½% Notes, and ahead of Silgan’s subordinated debt, if any. The 5% Notes are structurally subordinated to Silgan’s secured debt to the extent of the assets securing such debt and effectively subordinated to all obligations of subsidiaries of Silgan. Interest on the 5% Notes is payable semi-annually in cash on April 1 and October 1 of each year, and the 5% Notes mature on April 1, 2020. The 5% Notes are redeemable, at the option of Silgan, in whole or in part, at the following redemption prices (expressed in percentages of principal amount) plus accrued and unpaid interest thereon to the redemption date if redeemed during the twelve month period commencing April 1 of the years set forth below:
Year |  | Redemption Price
2016 |  | 102.500%
2017 |  | 101.250%
2018 and thereafter |  | 100.000%
Upon the occurrence of a change of control, as defined in the indenture for the 5% Notes, Silgan is required to make an offer to repurchase the 5% Notes at a purchase price equal to 101 percent of their principal amount, plus accrued and unpaid interest to the date of purchase. The indenture for the 5% Notes contains covenants which are generally less restrictive than those under the Credit Agreement and substantially similar to those under the indenture for the 5½% Notes.

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