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Senior Debt | 3 Months Ended
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Mar. 31, 2017
Debt Disclosure [Abstract] |
Senior Debt |
8. | Senior debt
Debt consisted of the following at March 31, 2017 and December 31, 2016:
(Table only in thousands) |  | March 31, 2017 |  |  | December 31, 2016 |
Outstanding borrowings under Credit Facility (defined below) Term loan payable in quarterly principal installments of $1.6 million through September 2017, $2.2 million through September 2018, and $2.7 million thereafter with balance due upon maturity in September 2020 |  |  |  |  |  |  |  |
- Term loan |  | $ | 121,034 |  |  | $ | 125,072 |
- Unamortized debt discount |  |  | (2,923 | ) |  |  | (3,175 | )
Total outstanding borrowings under Credit Facility |  |  | 118,111 |  |  |  | 121,897 |
Outstanding borrowings under China Facility (defined below) |  |  | 1,306 |  |  |  | 1,296 |
Total outstanding borrowings |  |  | 119,417 |  |  |  | 123,193 |
Less: current portion |  |  | 8,852 |  |  |  | 8,827 |
Total debt, less current portion |  | $ | 110,565 |  |  | $ | 114,366 |
During the three-month period ended March 31, 2017, the Company made prepayments of $2.3 million and scheduled payments of $1.7 million for a total payment amount of $4.0 million on the outstanding balance of the term loan. Scheduled principal payments under our debt facilities are $6.7 million for the remainder of 2017, $9.2 million in 2018, $10.8 million in 2019, and $95.7 million in 2020. United States Debt As of March 31, 2017 and December 31, 2016, $21.3 million and $18.0 million of letters of credit were outstanding, respectively. Total unused credit availability under the Company’s senior secured term loan, senior secured U.S. dollar revolving loans with sub-facilities for letters of credit and swing-line loans and senior secured multi-currency revolving credit facility for U.S. dollar and specific foreign currency loans (collectively, the “Credit Facility”) was $58.7 million and $62.0 million at March 31, 2017 and December 31, 2016, respectively. Revolving loans may be borrowed, repaid and reborrowed until September 3, 2020, at which time all amounts borrowed pursuant to the Credit Facility must be repaid. The weighted average stated interest rate on outstanding borrowings was 3.41% and 3.26% at March 31, 2017 and December 31, 2016, respectively. In accordance with the Credit Facility terms, the Company entered into an interest rate swap to hedge against interest rate exposure related to a portion of the outstanding debt indexed to LIBOR market rates. The fair value of the interest rate swap had no impact on the Condensed Consolidated Balance Sheet as of March 31, 2017. The fair value of the interest rate swap was a liability totaling $0.2 million December 31, 2016, which is recorded in “Accounts payable and accrued expenses” on the Consolidated Balance Sheets. The Company did not designate the interest rate swap as an effective hedge until the first quarter of 2016, and accordingly the change in the fair value until the date of designation of $0.5 million was recorded in earnings in “Other income (expense), net” in the Consolidated Statements of Income for the three-month period ended March 31, 2016. From the date of designation, a significant portion of the changes to the fair value of the interest rate swap have been recorded in other comprehensive income as the hedge is deemed effective. The credit agreement that outlines the terms of the Credit Facility contains customary affirmative and negative covenants, including the requirement to maintain compliance with a consolidated leverage ratio of less than 3.25 and a consolidated fixed charge coverage ratio of more than 1.25. Per the Credit Agreement, the maximum consolidated leverage ratio decreased to 3.25 on January 1, 2017, and is set to decrease again to 3.00 on October 1, 2017. The consolidated leverage ratio will then remain at 3.00 until the end of the term of the Credit Agreement. The Credit Agreement also includes customary events of default and the occurrence of an event of default could result in an increased interest rate equal to 2.0% above the applicable interest rate for loans, the acceleration of the Company’s obligations pursuant to the Credit Agreement and an obligation of the subsidiary guarantors to repay the full amount of the Company’s borrowings pursuant to the Credit Agreement. As of March 31, 2017 and December 31, 2016, the Company was in compliance with all related financial and other restrictive covenants under the Credit Agreement. Foreign Debt A subsidiary of the Company located in the Netherlands has a Euro denominated facilities agreement with ING Bank N.V. (“Aarding Facility”) with a total borrowing capacity of $13.9 million. As of March 31, 2017 and December 31, 2016, the borrowers were in compliance with all related financial and other restrictive covenants. As of March 31, 2017, $4.4 million of the bank guarantee and none of the overdraft facility are being used by the borrowers. As of December 31, 2016, $5.3 million of the bank guarantee and none of the overdraft facility was being used by the borrowers. There is no stated expiration date on the Aarding Facility. A subsidiary of the Company located in China has a Chinese Yuan Renminbi denominated short-term loan with Bank of America (“China Facility”) with an amount outstanding of $1.3 million as of March 31, 2017 and December 31, 2016. The China Facility has a stated interest rate of 4.79% and matures in May 2017. As a result of the PMFG acquisition, the Company acquired a 60% equity investment in Peerless Propulsys that entitled the Company to 80% of Peerless Propulsys’s earnings. In prior periods, the noncontrolling interest of Peerless Propulsys was reported as a separate component on the Consolidated Balance Sheets. During July of 2016, the Company entered into an agreement with the noncontrolling owner of Peerless Propulsys and issued a promissory note in the amount of $5.3 million due on July 11, 2019 in exchange for the remaining interest in Peerless Propulysys, which increased the Company’s ownership to 100% in the equity and earnings of Peerless Propulsys. The interest rate on the note payable is 1.50%, which approximates the market rate given the short term duration of the note payable. All of the Company’s assets are guaranteed to secure this agreement. As of December 31, 2016 and March 31, 2017, $5.3 million of the note payable was outstanding. The note is payable at the earlier of July 11, 2019 or thirty days subsequent to the sale of building and land that the Company owns in China. As the Company intends to sell this building and land within one year of March 31, 2017, this note payable is currently classified as a current liability in the Consolidated Balance Sheets as of December 31, 2017.

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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 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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