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Debt | 12 Months Ended
--- | ---
Dec. 31, 2013
Debt Disclosure [Abstract] |
Debt | Debt Outstanding debt at December 31, 2013 and December 31, 2012 is summarized as follows:
(in millions) |  | 2013 |  | 2012
Revolving credit facility |  | $ | — |  |  | $ | 34.4 |
Term loan A |  | 162.5 |  |  | 297.5 |
Term loan B |  | — |  |  | 81.0 |
Senior notes due 2018 |  | 408.4 |  |  | 410.5 |
Senior notes due 2020 |  | 614.8 |  |  | 621.2 |
Senior notes due 2022 |  | 289.1 |  |  | 298.9 |
Other |  | 52.0 |  |  | 57.5 |
Total debt |  | 1,526.8 |  |  | 1,801.0 |
Less current portion and short-term borrowings |  | (22.7 | ) |  | (69.0 | )
Long-term debt |  | $ | 1,504.1 |  |  | $ | 1,732.0 |
On May 13, 2011, the company entered into a $1,250.0 million Second Amended and Restated Credit Agreement (the “Senior Credit Facility”). The Senior Credit Facility includes three different loan facilities. The first is a revolving facility in the amount of $500.0 million, with a term of five years. The second facility is an amortizing Term Loan A facility in the aggregate amount of $350.0 million with a term of five years. The third facility is an amortizing Term Loan B facility in the amount of $400.0 million with a term of 6.5 years. Including interest rate caps at December 31, 2013, the weighted average interest rate for Term Loan A was 2.69%. Excluding interest rate caps, Term Loan A interest rate was 2.69% at December 31, 2013. The weighted average interest rates for the term loans at December 31, 2013 including and excluding the impact of the interest rate caps were the same because the relevant one-month U.S. LIBOR rate was below the 3.00% cap level. The revolving facility under the Senior Credit Facility has a maximum borrowing capacity of $500.0 million and would have expired in May 2016, but for being replaced by the revolving facility in the New Credit facility in the following paragraphs. As of December 31, 2013, the company had no borrowings on the revolving facility. During the year, the highest daily borrowing was $306.7 million and the average borrowing was $194.9 million, while the average interest rate was 3.66%. The interest rate fluctuates based upon LIBOR or a Prime rate plus a spread which is based upon the Consolidated Total Leverage Ratio of the company. As of December 31, 2013, the spreads for LIBOR and Prime borrowings were 2.50% and 1.25%, respectively given the effective Consolidated Total Leverage Ratio for this period. The Senior Credit Facility includes customary representations and warranties and events of default and customary covenants, including without limitation (i) a requirement that the company prepay the term loan facilities from the net proceeds of asset sales, casualty losses, equity offerings, and new indebtedness for borrowed money, and from a portion of its excess cash flow, subject to certain exceptions; and (ii) limitations on indebtedness, capital expenditures, restricted payments, and acquisitions. The losses on debt extinguishment of $3.0 million and $6.3 million during the year ended December 31, 2013 and December 31, 2012, respectively, consisted entirely of the write-off of deferred financing fees. The loss on debt extinguishment of $29.7 million during the year ended December 31, 2011 consisted of $16.1 million related to the write-off of deferred financing fees and $13.6 million related to the unwinding of related interest rate swaps. On January 3, 2014, the company entered into a $1,050.0 million Third Amended and Restated Credit Agreement (the “New Senior Credit Facility”) with JPMorgan Chase Bank, N.A., as Administrative Agent, Deutsche Bank Securities Inc., Bank of America, N.A., and Wells Fargo Bank, National Association, as Syndication Agents, and SunTrust Bank, as Documentation Agent. The New Senior Credit Facility includes three different loan facilities. The first is a revolving facility in the amount of $500.0 million, with a term of five years. The second facility is a Term A Loan in the aggregate amount of $350.0 million, with a term of five years. The third facility is a Term B Loan in the amount of $200.0 million, with a term of seven years. The company is obligated to prepay the two term loan facilities from the net proceeds of asset sales, casualty losses, equity offerings, and new indebtedness for borrowed money, and from a portion of its excess cash flow, subject to certain exceptions. Loans made under the New Senior Credit Facility will initially bear interest at 2.25% in excess of reserve adjusted LIBOR rate, or 1.25% in excess of an alternate base rate, at the company's option. The company will also pay a commitment fee of 0.45% per annum on the unused portion of the revolving facility. The company is also obligated to pay certain fees and expenses of the lenders. Loans made under the New Senior Credit Facility will be secured by substantially all of the assets of, and guaranteed by, the material direct and indirect domestic subsidiaries of the company, and secured by 65% of the stock of certain foreign subsidiaries of Manitowoc. The New Senior Credit Facility also requires the company to provide additional collateral to the lenders under the New Senior Credit Facility in certain limited circumstances. The New Senior Credit Facility also includes customary representations and warranties and affirmative and negative covenants. The New Senior Credit Facility contains financial covenants including (a) a Consolidated Interest Coverage Ratio, which measures the ratio of (i) consolidated earnings before interest, taxes, depreciation and amortization, and other adjustments (EBITDA), as defined in the credit agreement to (ii) consolidated cash interest expense, each for the most recent four fiscal quarters; and (b) a Consolidated Senior Secured Leverage Ratio, which measure the ratio of (i) consolidated senior secured indebtedness to (ii) consolidated EBITDA for the most recent four fiscal quarters. The covenant levels of the financial covenants under the New Senior Credit Facility as of December 31, 2013, are as set forth below:
Fiscal Quarter Ending |  | Consolidated Senior Secured Leverage Ratio (less than) |  | Consolidated Interest Coverage Ratio (greater than)
December 31, 2013 |  | 3.50:1.00 |  | 2.25:1.00
March 31, 2014 |  | 3.50:1.00 |  | 2.25:1.00
June 30, 2014 |  | 3.50:1.00 |  | 2.50:1.00
September 30, 2014 |  | 3.50:1.00 |  | 2.50:1.00
December 31, 2014 |  | 3.25:1.00 |  | 2.50:1.00
March 31, 2015 |  | 3.25:1.00 |  | 2.75:1.00
June 30, 2015 |  | 3.25:1.00 |  | 2.75:1.00
September 30, 2015 |  | 3.25:1.00 |  | 2.75:1.00
December 31, 2015 |  | 3.25:1.00 |  | 2.75:1.00
March 31, 2016 and thereafter |  | 3.00:1.00 |  | 3.00:1.00
As of December 31, 2013 the company had three series of Senior Notes outstanding, the 2018, 2020, and 2022 Notes (collectively the “Senior Notes”). Each series of Senior Notes are unsecured senior obligations ranking subordinate to all existing senior secured indebtedness and equal to all existing senior unsecured obligations. Each series of Senior Notes is guaranteed by certain of the company’s wholly owned domestic subsidiaries, which subsidiaries also guaranty the company’s obligations under the Senior Credit Facility. Each series of Senior Notes contains affirmative and negative covenants which limit, among other things, the company’s ability to redeem or repurchase its debt, incur additional debt, make acquisitions, merge with other entities, pay dividends or distributions, repurchase capital stock, and create or become subject to liens. Each series of Senior Notes also includes customary events of default. If an event of default occurs and is continuing with respect to the Senior Notes, then the Trustee or the holders of at least 25% of the principal amount of the outstanding Senior Notes may declare the principal and accrued interest on all of the Senior Notes to be due and payable immediately. In addition, in the case of an event of default arising from certain events of bankruptcy, all unpaid principal of, and premium, if any, and accrued and unpaid interest on all outstanding Senior Notes will become due and payable immediately. On October 19, 2012, the company completed the sale of $300.0 million aggregate principal amount of its 5.875% Senior Notes due October 2022 (the "2022 Notes") at an issue price of 100%. Net proceeds from the 2022 Notes were used to redeem the entire $150.0 million aggregate principal amount of its 2013 Notes, to repay $36.0 million of Term Loan B, and to repay a portion of the outstanding revolver borrowings under its Senior Credit Facility. Interest on the 2022 Notes is payable semi-annually on April 15 and October 15 of each year. The following would be the principal and premium paid by the company, expressed as percentages of the principal amount thereof, if it redeems the 2022 Notes during the 12-month period commencing on October 15 of the year set forth below:
Year | Percentage
2017 | 102.938 | %
2018 | 101.958 | %
2019 | 100.979 | %
2020 and thereafter | 100.000 | %
In addition, at any time prior to October 15, 2015, the company is permitted to, at its option, use the net cash proceeds of one or more public equity offers to redeem up to 35% of the 2022 Notes at a redemption price of 105.875%, plus accrued but unpaid interest, if any, to the date of redemption; provided that (1) at least 65% of the principal amount of the 2022 Notes outstanding remains outstanding immediately after any such redemption; and (2) the company makes such redemptions not more than 90 days after the consummation of any such public offering. Further, the company is required to offer to repurchase the 2022 Notes for cash at a price of 101% of the aggregate principal amount of the 2022 Notes, plus accrued and unpaid interest, if any, upon the occurrence of a change of control triggering event. On October 18, 2010, the company completed the sale of $600.0 million aggregate principal amount of its 8.50% Senior Notes due 2020 (the “2020 Notes”). Interest on the 2020 Notes is payable semi-annually in May and November of each year. The following would be the principal and premium paid by the company, expressed as percentages of the principal amount thereof, if it redeems the 2020 Notes during the 12-month period commencing on November 1 of the year set forth below:
Year | Percentage
2015 | 104.250 | %
2016 | 102.833 | %
2017 | 101.417 | %
2018 and thereafter | 100.000 | %
On February 3, 2010, the company completed the sale of $400.0 million aggregate principal amount of its 9.50% Senior Notes due 2018 (the “2018 Notes”). Interest on the 2018 Notes was payable semiannually in February and August of each year. On February 18, 2014 the Company redeemed its 2018 Notes for $419.0 million or 104.750%, expressed as a percentage of the principal amount. In the third quarter of 2011, the company monetized the derivative asset related to the fixed-to-float interest rate swaps in connection with the 2018 and 2020 Notes and received $21.5 million. The gain was treated as an increase to the debt balances for the 2018 and 2020 Notes and is being amortized to interest expense over the life of the original swap. Later in 2011, the company entered new interest rate swaps due in 2018 and 2020. In the third quarter of 2012, the company further monetized the derivative asset related to the fixed-to-float interest rate swaps related to its 2018 and 2020 Notes and received $14.8 million. Consistent with the prior monetization, the company treated the gain as an increase to the debt balances for each of the 2018 and 2020 Notes, which is being amortized to interest expense over the life of the original swaps. In the fourth quarter of 2012, the company purchased and designated new fixed-to-float swaps as fair market value hedges of the 2022 Notes. In May 2013, the company entered into new interest rate swaps due in 2020 and 2022, designating them as fair market value hedges of the 2020 and 2022 Notes, respectively. As of December 31, 2013, $75.0 million and $125.0 million of the 2020 and 2022 Notes, respectively, were swapped to floating rate interest. Including the floating rate swaps, the 2020 and 2022 Notes have an all-in interest rate of 8.31% and 5.188%, respectively. The balance sheet values of the 2018, 2020, and 2022 Notes at December 31, 2013 and December 31, 2012 are not equal to the face value of the Senior Notes due to the fact that the fair market value of the interest rate hedges and interest rate monetization premiums on these Senior Notes are included in the balance sheet value. As of December 31, 2013, the company had outstanding $76.5 million of other indebtedness, including $24.5 million related to Manitowoc Dong Yue, that has a weighted-average interest rate of approximately 6.43%. This debt includes outstanding overdraft balances and capital lease obligations in its Americas, Asia-Pacific and European regions. The aggregate scheduled maturities of outstanding debt obligations in subsequent years are as follows:
(in millions) |
2014 | $ | 22.7 |
2015 | 32.5 |
2016 | 146.1 |
2017 | 5.1 |
2018 | 412.0 |
Thereafter | 908.4 |
Total | $ | 1,526.8 |
See Note 6, “Derivative Financial Instruments” for a description of hedging instruments used related to managing interest rate risk. As of December 31, 2013, the company was in compliance with all affirmative and negative covenants in its debt instruments, inclusive of the financial covenants pertaining to the New Senior Credit Facility, the 2018 Notes, 2020 Notes, and 2022 Notes. Based upon management's current plans and outlook, it believes the company will be able to comply with these covenants during the subsequent 12 months. As of December 31, 2013 our Consolidated Senior Secured Leverage Ratio was 0.79:1, while the maximum ratio is 3.50:1 and our Consolidated Interest Coverage Ratio was 3.79:1, above the minimum ratio of 2.25:1.

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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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