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BORROWINGS | 12 Months Ended
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Dec. 31, 2014
BORROWINGS |
BORROWINGS | 11. BORROWINGS
|  | At December 31, 2013 |  | At December 31, 2014 |
|  | $ |  | $ |
Bank borrowings |  |  | 929,904,076 |  |  | 859,812,259 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Analysis as: |  |  |  |  |  |  |
Short-term |  |  | 588,765,154 |  |  | 655,925,862 |
Long-term, current portion |  |  | 136,449,641 |  |  | 37,201,847 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Subtotal for short-term |  |  | 725,214,795 |  |  | 693,127,709 |
Long-term, non-current portion |  |  | 142,653,448 |  |  | 103,611,101 |
Borrowings from non-banking institutions |  |  | 62,035,833 |  |  | 63,073,449 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Analysis as: |  |  |  |  |  |  |
Short-term |  |  | 53,297,709 |  |  | 14,708,285 |
Long-term, current portion |  |  | — |  |  | 17,676,744 |
Long-term, non-current portion |  |  | 8,738,124 |  |  | 30,688,420 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total |  |  | 929,904,076 |  |  | 859,812,259 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
As of December 31, 2014, the Company had contractual bank credit facilities of $760,604,494, of which $64,585,507 has been drawn down with the due dates beyond December 31, 2015, $521,811,874 has been drawn down with the due dates before December 31, 2015 and $174,207,112 was available for draw down upon demand. In addition, as of December 31, 2014, the Company also had non-binding bank credit facilities of $416,020,871, of which $352,410,374 has been drawn down with the due dates before December 31, 2015 and $63,610,497 was subject to banks' discretion upon request for additional drawn down. As of December 31, 2014, short-term borrowings of $194,070,677 and long-term borrowings of $58,968,175 were secured by property, plant and equipment with carrying amounts of $202,198,318, inventories of $49,715,280, prepaid land use rights of $5,248,225 and project assets of $80,616,777. a) Short-term The Company's short-term borrowings consist of the following:
|  | At December 31, 2013 |  | At December 31, 2014 |
|  | $ |  | $ |
Bank borrowings |  |  |  |  |  |  |
Short-term bank borrowings secured by restricted cash |  |  | 69,840,000 |  |  | 120,772,338 |
Short-term bank borrowings secured by inventories |  |  | 32,905,247 |  |  | 35,881,746 |
Short-term bank borrowings guaranteed by Dr. Shawn Qu |  |  | 30,161,927 |  |  | 57,419,443 |
Short-term bank borrowings secured by prepaid land use rights and property, plant and equipment |  |  | 108,781,908 |  |  | 91,270,262 |
Short-term bank borrowings secured by project assets |  |  | 28,035,954 |  |  | 45,148,851 |
Short-term bank borrowings secured by bank notes |  |  | 36,420,800 |  |  | — |
Unsecured short-term borrowings |  |  | 282,619,318 |  |  | 305,433,222 |
Long-term borrowings due within one year |  |  |  |  |  |  |
Long-term borrowings due within one year secured by prepaid land use rights and property, plant and equipment |  |  | 19,926,520 |  |  | 5,033,502 |
Long-term borrowings due within one year secured by project assets |  |  | 49,821,157 |  |  | 586,630 |
Long-term borrowings due within one year secured by restricted cash |  |  | — |  |  | 19,400,000 |
Unsecured long-term borrowings due within one year |  |  | 66,701,964 |  |  | 12,181,715 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
|  |  | 725,214,795 |  |  | 693,127,709 |
Borrowings from non-banking institutions |  |  |  |  |  |  |
Long-term borrowings due within one year secured by project assets |  |  | — |  |  | 16,149,686 |
Unsecured long-term borrowings due within one year |  |  | — |  |  | 1,527,059 |
Unsecured short-term borrowings |  |  | 53,297,709 |  |  | 14,708,284 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
|  |  | 53,297,709 |  |  | 32,385,029 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total |  |  | 778,512,504 |  |  | 725,512,738 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
The average interest rate on short-term borrowings was 4.67% and 4.63% per annum for the years ended December 31, 2013 and 2014, respectively. The short-term borrowings are repayable within one year. b) Long-term The Company's long-term borrowings consist of the following:
|  | At December 31, 2013 |  | At December 31, 2014 |
|  | $ |  | $ |
Bank borrowings |  |  |  |  |  |  |
Unsecured long-term bank borrowings |  |  | 62,664,031 |  |  | 50,162,122 |
Long-term bank borrowings secured by project assets |  |  | 60,589,417 |  |  | 43,748,979 |
Long-term bank borrowings secured by restricted cash |  |  | 19,400,000 |  |  | 9,700,000 |
Borrowings from non-banking institutions |  |  |  |  |  |  |
Long-term borrowings secured by project assets |  |  | 7,590,000 |  |  | 15,219,196 |
Unsecured long-term borrowings |  |  | 1,148,124 |  |  | 15,469.224 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total |  |  | 151,391,572 |  |  | 134,299,521 |
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
The average interest rate on long-term borrowings was 6.15% and 6.32% per annum for the years ended December 31, 2013 and 2014, respectively. Future principal repayment on the long-term borrowings are as follows:
2015 |  |  | 54,878,591 |
2016 |  |  | 57,778,769 |
2017 |  |  | 36,450,149 |
2018 |  |  | 7,304,681 |
2019 and thereafter |  |  | 32,765,922 |
​ | ​ | ​ | ​ | ​
Total |  |  | 189,178,112 |
Less: future principal repayment related to long-term borrowings, current portion |  |  | (54,878,591 | )
​ | ​ | ​ | ​ | ​
Total long-term portion |  | $ | 134,299,521 |
​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​
On October 29, 2011, CSI Cells Co., Ltd. entered into a syndicated loan agreement with local Chinese commercial banks, denominated in RMB. The latest renewed total credit facility under this agreement equaled $73,165,550. The facility bears the base interest rate published by People's Bank of China for the same maturity for RMB denominated borrowings and the interest under both tranches is due quarterly in arrears. Outstanding borrowings under this agreement equaled $61,640,791 at December 31, 2014, which requires repayment of $11,524,759, $25,229,613, and $24,886,419 in 2015, 2016, and 2017 respectively. The borrowing under the agreement is guaranteed by CSI Solar Power (China) Inc., Canadian Solar Manufacturing (Luoyang) Inc. and Canadian Solar Manufacturing (Changshu) Inc. The agreement does not contain any financial covenants or restrictions. On October 28, 2013, CSI Cells Co., Ltd., entered into a loan agreement, denominated in RMB, with a state-owned trust company about research of solar photovoltaic technology. The total credit facility under this agreement equaled $1,143,978, which requires repayment of $1,148,124 in 2016. The loan is free of interest and does not contain any financial covenants or restrictions. On June 26, 2012, Canadian Solar Japan K.K. entered into a loan agreement with a Japanese bank for working capital, denominated in Japanese yen. The latest renewed total credit facility under the agreement equaled $267,191, which has a maturity of 36 months. Outstanding borrowings under this agreement were $267,191 at December 31, 2014, which requires the repayment of $267,191 in 2015. The borrowing bears a fixed rate of 0.9% and does not contain any financial covenants or restrictions. On February 28 2013, Canadian Solar Japan K.K. entered into a loan agreement with a Japanese bank for working capital, denominated in Japanese yen. The latest renewed total credit facility under this agreement equaled $435,855. The facility bears a fixed rate of 1.45% per year and requires repayment of $32,480 each month. The outstanding borrowings under this agreement equaled $435,855 at December 31, 2014, which requires repayment of $389,765, and $46,090 in 2015 and 2016 respectively. The agreement does not contain any financial covenants or restrictions. On May 20, 2013, CSI Solar Manufacture Inc. and Tumushuke CSI New Energy Development Co., Ltd., the Company's 100% owned subsidiaries, entered into a loan agreement with a local Chinese bank, denominated in RMB, for construction of a solar power project in China. The latest renewed total credit facility under this agreement equaled $36,035,300 which requires repayment of $3,186,795, $3,105,083, $3,105,083, $3,268,508 and $23,369,831 in 2015, 2016, 2017, 2018, 2019 and thereafter, respectively. Interest is due quarterly in arrears. The outstanding balance as of December 31, 2014 equaled $36,035,300, which was guaranteed by CSI Solar Power (China) Inc. and secured by the project assets of Tumushuke CSI New Energy Development Co., Ltd. The borrowing bears a floating rate equal to the base interest rate published by People's Bank of China with the same maturities, which was 6.550% as of December 31, 2014 for loans of more than 5 years. The borrowing also contains financial covenants which require that the ratio of liabilities to assets of CSI Solar Manufacture Inc. and Tumushuke CSI New Energy Development Co., Ltd. shall not exceed 75%. As at December 31, 2014, the Company met all the requirements of the financial covenants. On November 25, 2013, Canadian Solar International Limited entered into a loan agreement with a Chinese commercial bank overseas branch, denominated in U.S. dollars, for general working capital purposes. Outstanding borrowings under this agreement were $29,100,000 at December 31, 2014, which requires repayment of $19,400,000, and $9,700,000 in 2015 and 2016 respectively. The borrowing bears a floating interest rate equal to LIBOR+1.8% and the agreement does not contain any financial covenants or restrictions. On December 4, 2013, Canadian Solar International Project 1 Limited, the Company's 100% owned subsidiary, entered into a loan agreement with, denominated in U.S. dollars, Harvest North Star Capital. The total credit facility under this agreement was $40,000,000 and will be used to finance the development of several ground-mounted solar power projects in Japan. Outstanding borrowings under this agreement equaled $34,335,015 at December 31, 2014, which requires repayment of $17,676,744 and $16,658,271 in 2015 and 2016 respectively. The loan is secured by project assets and guaranteed by Canadian Solar Inc. and bears 12.5% per annum rate. The agreement does not contain any financial covenants or restrictions. On Aug 28, 2013, CSI Solar Power (China) Inc. entered into a financing agreement, denominated in RMB, with China Development Bank, Suzhou Branch, or CDB, pursuant to which CDB agreed to provide $7,517,568, in long-term construction financing for the construction of solar power projects in Suzhou National New and High-tech Industrial Development Zone. Outstanding borrowings under this agreement equaled $7,517,568 at December 31, 2014, which requires repayment of $1,143,978, $1,143,978, $1,143,978, $1,143,978, and $2,941,656 in 2015, 2016, 2017, 2018, 2019 and thereafter, respectively. The loan is secured by project assets and guaranteed by Canadian Solar Inc. and bears 6.55% per annum rate. The borrowing also contains financial covenants which require that the ratio of liabilities to assets of CSI Solar Power (China) Inc. shall not exceed 80% and the annual consolidated revenue shall exceed RMB 5 billion. As at December 31, 2014, the Company met all the requirements of the financial covenants. On Nov 14, 2013, CSI Photovoltaic Energy (Sihong) Inc., the Company's 100% owned subsidiary, entered into a financing agreement, denominated in RMB, with CDB, pursuant to which CDB agreed to provide $5,229,613, in long-term construction financing to us for the construction of solar power projects in Sihong, Jiangsu. Outstanding borrowings under this agreement equaled $5,229,613 at December 31, 2014, which requires repayment of $702,729, $751,757, $751,757, $784,442, and $2,238,928 in 2015, 2016, 2017, 2018, 2019 and thereafter, respectively. The loan is secured by project assets and guaranteed by CSI Solar Power (China) Inc. and bears 6.878% per annum rate. The borrowing also contains financial covenants which require that the ratio of liabilities to assets of CSI Photovoltaic Energy (Sihong) Inc. shall not exceed 75%. As at December 31, 2014, the Company met all the requirements of the financial covenants. On Jun 25, 2014, CSI-GCL (Yancheng) Solar Manufacturing Co., Ltd. entered into a financing agreement, denominated in RMB, with Jiangsu Haixin Energy Development Co., Ltd., or Haixin, pursuant to which Haixin agreed to provide $44,124,857, in long-term construction financing for the construction of solar power projects and production line construction in Yancheng, Jiangsu. The facility is composed of two tranches. The first tranche has a credit limit of $24,513,809, which requires repayment within three years and was for working capital purposes. The second tranche has a credit limit of $19,611,048 for the expansion of solar cell production capacity. As of December 31, 2014, CSI-GCL (Yancheng) Solar Manufacturing Co., Ltd. has drawn $6,684,524 and $6,201,647 respectively from the first and the second tranche. Both of the tranches are free of security and interest and the agreement does not contain any financial covenants or restrictions. The total outstanding borrowings under this agreement equaled $12,886,171 at December 31, 2014, which requires repayment of $6,201,647, $2,228,175, and $4,456,349 in 2017, 2018, 2019 and thereafter respectively. The agreement does not contain any financial covenants or restrictions. On Feb 25, 2014, Glenarm LP,2172839 Ontario Corp, the Company's 100% owned subsidiary, entered into a financing agreement, denominated in Canadian dollars, with Natixis Bank, pursuant to which Natixis Bank agreed to provide $585,630, in long-term construction financing for the construction of solar power projects. Outstanding borrowings under this agreement were $585,630 at December 31, 2014, which requires repayment of $585,630 in 2015. The loan is secured by project assets and bears 3.750% per annum rate. The agreement does not contain any financial covenants or restrictions. c) Interest expense The Company capitalized interest costs incurred into the Company's project assets or property, plant and equipment as follows during the years ended December 31, 2012, 2013 and 2014:
|  | Years Ended December 31 |
|  | 2012 |  | 2013 |  | 2014 |
|  | $ |  | $ |  | $ |
Interest capitalized—project assets |  |  | 4,631,569 |  |  | 17,292,847 |  |  | 10,304,555 |
Interest capitalized—property, plant and equipment |  |  | 670,374 |  |  | 347,791 |  |  | 203,067 |
Interest expense |  |  | 53,304,640 |  |  | 46,244,456 |  |  | 48,905,848 |
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Total interest incurred |  |  | 58,606,583 |  |  | 63,885,094 |  |  | 59,413,470 |
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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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