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LONG-TERM DEBT | 12 Months Ended
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Dec. 31, 2013
LONG-TERM DEBT |
LONG-TERM DEBT | 8. LONG-TERM DEBT At December 31, 2013 and 2012, long-term debt consisted of the following (in millions):
|  | As of December 31, |
|  | 2013 |  | 2012 |
Term Loans: |  |  |  |  |
5.79%, payable through 2020 |  | $ | 45.5 |  | $ | 52.5 |
3.66%, payable through 2023 |  | 77.5 |  | 77.5 |
4.16%, payable through 2027 |  | 55.0 |  | 55.0 |
4.31%, payable through 2032 |  | 37.5 |  | 37.5 |
Title XI Bonds: |  |  |  |  |
5.34%, payable through 2028 |  | 33.0 |  | 35.2 |
5.27%, payable through 2029 |  | 35.2 |  | 37.4 |
Revolving Credit Borrowings (1.69% for 2012) |  | — |  | 24.0 |
Capital leases |  | 2.4 |  | — |
|  | 286.1 |  | 319.1 |
Less current portion |  | (12.5 | ) | (16.4 | )
Total long-term debt |  | $ | 273.6 |  | $ | 302.7 |
Long-term Debt Maturities: At December 31, 2013, debt maturities during the next five years and thereafter are as follows (in millions):
2014 |  | $ | 12.5 |
2015 |  | 21.7 |
2016 |  | 20.6 |
2017 |  | 28.2 |
2018 |  | 28.2 |
Thereafter |  | 174.9 |
Total |  | $ | 286.1 |
Term Loans: During the second quarter of 2012, the Company executed new unsecured, fixed rate, amortizing long-term debt of $170.0 million, which was funded in three tranches, $77.5 million at an interest rate of 3.66% maturing in 2023, $55.0 million at an interest rate of 4.16% maturing in 2027, and $37.5 million at an interest rate of 4.31% maturing in 2032. Interest is payable semi-annually. The weighted average coupon and average life of the three tranches of debt is 3.97% and 9.2 years, respectively. The notes will begin to amortize in 2015, with aggregate semi-annual payments of $4.6 million through 2016, $8.4 million in 2017 through mid-year 2023, $3.8 million through mid-year 2027, and $1.2 million thereafter. The cash received from the issuance of the three tranches of debt was partially utilized for the contribution of cash to A&B during the Separation. In May 2005, the Company partially financed the delivery of the MV Manulani by issuing $105.0 million of Series B Notes with a coupon of 4.79% and 15-year final maturity. The notes amortize by semi-annual principal payments of $3.5 million plus interest. T he Company negotiated the release of the MV Manulani as security for the remaining long-term debt of $56.0 million as part of the Company’s debt restructuring completed during the Separation, resulting in an increase in the interest rate to 5.79%. In January 2014, the Company issued $100 million of 30-year senior unsecured notes (the “Notes”). The Notes have a weighted average life of 14.5 years and bear interest at a rate of 4.35%, payable semi-annually. The proceeds are expected to be used for general corporate purposes. The Notes will begin to amortize in 2021, with annual principal payments of $5.0 million in 2021, $7.5 million in 2022 and 2023, $10.0 million from 2024 to 2027, and $8.0 million in 2028. Starting in 2029, and in each year thereafter until 2044, annual principal payments will be $2.0 million. Title XI Bonds: In September 2003, the Company issued $55.0 million in U.S. Government guaranteed ship finance bonds (Title XI) to partially finance the delivery of the MV Manukai. The secured bonds have a final maturity in September 2028 with a coupon of 5.34%. The bonds are amortized by fifty semi-annual payments of $1.1 million plus interest. In August 2004, the Company issued $55.0 million of U.S. Government guaranteed ship finance bonds (Title XI) to partially finance the delivery of the MV Maunawili. The secured bonds have a final maturity in July 2029, with a coupon of 5.27%. The bonds are amortized by fifty semi-annual payments of $1.1 million plus interest. Revolving Credit Facility: During the second quarter 2012, the Company entered into a new $375.0 million, five-year unsecured revolving credit facility with a syndicate of banks in order to provide additional sources of liquidity for working capital requirements and investment opportunities. As of December 31, 2013, the used portion of the Company’s revolving credit facility was $5.8 million, all of which was from letters of credit. In August 2011, the Company renewed its revolving credit facility with a commitment of $125.0 million and an expiration date of August 2016. Amounts drawn under the facility accrued interest at LIBOR plus a margin based on a ratio of consolidated debt to earnings before interest, taxes, depreciation and amortization pricing grid. Borrowing rates ranged from 1.21% to 1.92% during 2012, and 0.44% to 1.91% during 2011. As part of the Company’s debt restructuring completed in June 2012, in connection with the Separation, the outstanding balance of $72.0 million was paid off and the facility was terminated. Capital Leases: As of December 31, 2013, the Company had obligations under its capital leases of $2.4 million consisting of specialized and standard containers used in the Company’s South Pacific service. Capital leases have been classified within current and long-term debt in the Company’s Consolidated Balance Sheet. Total debt was $286.1 million as of December 31, 2013, compared with $319.1 million at the end of 2012. The outstanding debt was unsecured, except for $68.2 million as of December 31, 2013, which is guaranteed by the Company’s significant subsidiaries. Principal financial covenants as defined in the Company’s five-year revolving credit facility (“Credit Agreement”) and long-term fixed rate debt include, but are not limited to: · The ratio of debt to consolidated EBITDA cannot exceed 3.25 to 1.00 for each fiscal four quarter period; · The ratio of consolidated EBITDA to interest expense as of the end of any fiscal four quarter period cannot be less than 3.50 to 1.00; and · The principal amount of priority debt at any time cannot exceed 20% of consolidated tangible assets; and the principal amount of priority debt that is not Title XI priority debt at any time cannot exceed 10% of consolidated tangible assets. Priority debt, as further defined in the Credit Agreement, is all debt secured by a lien on the Company’s assets or subsidiary debt. The Company was in compliance with these covenants as of December 31, 2013, with a debt to consolidated EBITDA ratio of 1.61, consolidated EBITDA to interest expense ratio of 12.28, and priority debt to consolidated tangible assets ratio of 5.8%.

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- 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 Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 19, 20, 22 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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