v3.3.1.900

Debt | 12 Months Ended
--- | ---
Dec. 31, 2015
Debt Disclosure [Abstract] |
Debt Disclosure [Text Block] | Debt Long-term debt consisted of the following:
| December 31,
| 2015 |  | 2014
| (In thousands)
Term loans | $ | 713,175 |  |  | $ | 1,210,474 |
Trade receivables financing arrangement | 75,800 |  |  | 80,000 |
Revolving credit facilities and other | 628,572 |  |  | 246,336 |
Total Debt | 1,417,547 |  |  | 1,536,810 |
Less: current portion | (5,792 | ) |  | (9,855 | )
Long-term debt | $ | 1,411,755 |  |  | $ | 1,526,955 |
The Company entered into a credit agreement by and among the Company, Colfax UK Holdings Ltd, the other subsidiaries of the Company party thereto, the lenders party thereto and Deutsche Bank AG New York Branch, as administrative agent (the “Deutsche Bank Credit Agreement”) on September 12, 2011. In connection with the closing of the acquisition of Charter International plc, the Deutsche Bank Credit Agreement was amended on January 13, 2012 and the Company terminated its existing credit agreement as well as Charter’s outstanding indebtedness. A Second Amendment and Third Agreement to the Deutsche Bank Credit Agreement was entered into on February 22, 2013 and November 7, 2013, respectively, which, among other things, reallocated borrowing capacities of the tranches of loans and reduced interest rate margins when compared to the terms of the amended Deutsche Bank Credit Agreement on January 13, 2012. On May 14, 2014, the Company entered into an Incremental Amendment to the Term A-1 facility under the Deutsche Bank Credit Agreement, as amended. Pursuant to the Incremental Amendment, the borrowing capacity of the Term A-1 facility was increased by $150.0 million to an aggregate of $558.7 million, upon the same terms as the existing Term A-1 facility. On June 5, 2015, the Company entered into a credit agreement (the “2015 Deutsche Bank Credit Agreement”) by and among the Company, as the borrower, certain U.S. subsidiaries of the Company identified therein, as guarantors, each of the lenders party thereto and Deutsche Bank AG New York Branch, as administrative agent, swing line lender and global coordinator. The proceeds of the loans under the 2015 Deutsche Bank Credit Agreement were used by the Company to repay in full balances under its preexisting Deutsche Bank Credit Agreement, as well as for working capital and general corporate purposes. The 2015 Deutsche Bank Credit Agreement consists of a term loan in an aggregate amount of $750.0 million (the “Term Loan”) and a revolving credit facility (the “Revolver”), each of which matures in five years. The Revolver contains a $50.0 million swing line loan sub-facility. On September 25, 2015, the Company entered into an Increase Agreement, as provided for under the terms of the 2015 Deutsche Bank Credit Agreement. Under the Increase Agreement, the Company increased the Revolver by $300.0 million, resulting in a total Revolver commitment under the 2015 Deutsche Bank Credit Agreement of $1.3 billion. The Term Loan and the Revolver bear interest, at the election of the Company, at either the base rate (as defined in the 2015 Deutsche Bank Credit Agreement) or the Eurocurrency rate (as defined in the 2015 Deutsche Bank Credit Agreement), in each case, plus the applicable interest rate margin. The Term Loan and the Revolver initially bear interest either at the Eurocurrency rate plus 1.50% or at the base rate plus 0.50%, and in future quarters will bear interest either at the Eurocurrency rate or the base rate plus the applicable interest rate margin based upon either, whichever results in the lower applicable interest rate margin (subject to certain exceptions), the Company’s total leverage ratio and the corporate family rating of the Company as determined by Standard & Poor’s and Moody’s (ranging from 1.25% to 2.00%, in the case of the Eurocurrency margin, and 0.25% to 1.00%, in the case of the base rate margin). Swing line loans bear interest at the applicable rate, as specified under the terms of the 2015 Deutsche Bank Credit Agreement, based upon the currency borrowed. In conjunction with the 2015 Deutsche Bank Credit Agreement, the Company recorded a charge to Interest expense in the Consolidated Statement of Income for the year ended December 31, 2015 of $4.7 million to write-off certain deferred financing fees and original issue discount and expensed approximately $0.4 million of costs incurred in connection with the refinancing of the 2015 Deutsche Bank Credit Agreement. The Company had an original issue discount of $7.5 million and deferred financing fees of $8.1 million included in its Consolidated Balance Sheet as of December 31, 2015, which will be accreted to Interest expense primarily using the effective interest method, over the life of the 2015 Deutsche Bank Credit Agreement. As of December 31, 2015, the weighted-average interest rate of borrowings under the 2015 Deutsche Bank Credit Agreement was 1.83%, excluding accretion of original issue discount and amortization of deferred financing fees, and there was $688.8 million available on the revolving credit facility. The Company is also party to letter of credit facilities with total capacity of $718.8 million. Total letters of credit of $360.4 million were outstanding as of December 31, 2015. On December 22, 2014, the Company entered into a receivables financing facility, pursuant to which it established a wholly owned, special purpose bankruptcy-remote subsidiary which purchases trade receivables from certain of the Company’s subsidiaries on an ongoing basis and pledges them to support its obligation as borrower under the receivables financing facility. This special purpose subsidiary has a separate legal existence from its parent and its assets are not available to satisfy the claims of creditors of the selling subsidiaries or any other member of the consolidated group. Availability of funds may fluctuate over time given changes in eligible receivable balances, but will not exceed the program limit. On December 21, 2015, the Company increased the receivables financing facility by $15 million to $95 million and extended the facility through December 20, 2016. As of December 31, 2015, the total outstanding borrowings under the receivables financing facility were $75.8 million and the interest rate was 1.2%. The scheduled termination date for the receivables financing facility may be extended from time to time. The facility contains representations, warranties, covenants and indemnities customary for facilities of this type. The facility does not contain any covenants that the Company views as materially constraining to the activities of its business. The contractual maturities of the Company’s debt as of December 31, 2015 are as follows(1):
| (In thousands)
2016 | $ | 5,792 |
2017 | 4,536 |
2018 | 4,598 |
2019 | 2,405 |
2020 | 1,408,916 |
Total contractual maturities | 1,426,247 |
Debt discount(2) | (8,700 | )
Total debt | $ | 1,417,547 |
(1) Represents scheduled payments required under the 2015 Deutsche Bank Credit Agreement through June 5, 2020, as well as the contractual maturities of other debt outstanding as of December 31, 2015, and reflects management’s intention to repay scheduled maturities of the term loans outstanding under the 2015 Deutsche Bank Credit Agreement and the trade receivables financing arrangement (if not extended) with proceeds from the revolving credit facility. (2) Includes $1.2 million of deferred debt issuance costs pursuant to the adoption of ASU No. 2015-03. See Note 3, “Recently Issued Accounting Pronouncements” for further discussion. Certain U.S. subsidiaries of the Company have agreed to guarantee the obligations of the Company under the 2015 Deutsche Bank Credit Agreement. The 2015 Deutsche Bank Credit Agreement contains customary covenants limiting the ability of the Company and its subsidiaries to, among other things, incur debt or liens, merge or consolidate with others, dispose of assets, make investments or pay dividends. In addition, the 2015 Deutsche Bank Credit Agreement contains financial covenants requiring the Company to maintain a total leverage ratio, as defined therein, of not more than 3.5 to 1.0 and minimum interest coverage ratio, as defined therein, of 3.0 to 1.0, measured at the end of each quarter. The 2015 Deutsche Bank Credit Agreement contains various events of default (including failure to comply with the covenants under the 2015 Deutsche Bank Credit Agreement and related agreements) and upon an event of default the lenders may, subject to various customary cure rights, require the immediate payment of all amounts outstanding under the Term Loan and the Revolver. As of December 31, 2015, the Company is in compliance with the covenants under the 2015 Deutsche Bank Credit Agreement.

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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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