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Debt And Credit Agreements
 12 Months Ended
Dec. 31, 2012
Debt And Credit Agreements [Abstract]  
Debt And Credit Agreements

11 DEBT AND CREDIT AGREEMENTS

     On April 23, 2012, we entered into a $350 million five-year, unsecured revolving credit facility (the "Credit Agreement"), with an option to increase that amount by an additional $75 million. The Credit Agreement replaced our previous $300 million four-year, unsecured revolving credit facility that was due to expire on June 21, 2014. In connection with the refinancing, we borrowed $102 million under the Credit Agreement, which was used, together with available cash on hand, to repay all indebtedness under our previous revolving credit facility.

     Borrowings under the Credit Agreement bear an interest rate of LIBOR plus a credit spread and commitment fees charged on the unused amount under the Credit Agreement at various indebtedness-to-adjusted-EBITDA levels as follows:

Pricing Under Revolving Credit Agreement (Basis Points)
Indebtedness-to-Adjusted Credit Spread Commitment
EBITDA Ratio Over LIBOR Fee
2.0x but <= 3.0x 200 35
1.0x but <=2.0x 175 30
<= 1.0x 150 25

 

     At December 31, 2012, the interest cost on debt borrowed under the Credit Agreement was priced at one-month LIBOR plus the applicable credit spread of 150 basis points.

The most restrictive covenants in the Credit Agreement include:

  • Maximum indebtedness-to-adjusted EBITDA of 3.0x;
  • Minimum adjusted EBIT-to-interest expense of 2.5x;
  • Maximum aggregate distributions to shareholders over the term of the Credit Agreement of $100 million plus, beginning with the fiscal quarter ended March 31, 2012, 50% of net income; and
  • Minimum shareholders' equity at any point during the term of the Credit Agreement of at least $320 million increased on a cumulative basis at the end of each fiscal quarter, beginning with the fiscal quarter ended March 31, 2012, by an amount equal to 50% of net income (to the extent positive).

     At December 31, 2012, based upon the most restrictive covenants within the Credit Agreement, available credit under the Credit Agreement was approximately $199 million. Total debt due and outstanding at December 31, 2012 is summarized below:

Debt Due and Outstanding at December 31, 2012
(In Thousands)
 
Year   Credit       Total Debt
Due Agreement   Other   Due
2013 $ - $ - $ -
2014   -   -   -
2015   -   -   -
2016   -   -   -
2017   128,000   -   128,000
Total $ 128,000 $ - $ 128,000

 

     We believe we were in compliance with all of our debt covenants as of December 31, 2012. Noncompliance with any of the debt covenants may have a material adverse effect on financial condition or liquidity in the event such noncompliance cannot be cured or should we be unable to obtain a waiver from the lenders. Renegotiation of the covenant through an amendment to the Credit Agreement may effectively cure the noncompliance, but may have an effect on financial condition or liquidity depending upon how the covenant is renegotiated.