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Indebtedness | 9 Months Ended
--- | ---
Sep. 30, 2013
Indebtedness | 8. Substantially all of the Company’s assets are pledged as collateral with its banks. The Company has various loans in place that together constitute the short-term and long-term loan balances shown in the balance sheet at September 30, 2013 and December 31, 2012. These are summarized in the following table:
Indebtedness |  | September 30, 2013 |  |  | December 31, 2012 |
$000’s |  | Long-term |  |  | Short-term |  |  | Total |  |  | Long-term |  |  | Short-term |  |  | Total |
Term loan |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 36,000 |  |  | $ | 10,000 |  |  | $ | 46,000 |
Working capital revolver |  |  | 38,750 |  |  |  | — |  |  |  | 38,750 |  |  |  | — |  |  |  | — |  |  |  | — |
Notes payable on product acquisitions and asset purchase |  |  | 144 |  |  |  | 71 |  |  |  | 215 |  |  |  | 196 |  |  |  | 6,247 |  |  |  | 6,443 |
Total indebtedness |  | $ | 38,894 |  |  | $ | 71 |  |  | $ | 38,965 |  |  | $ | 36,196 |  |  | $ | 16,247 |  |  | $ | 52,443 |
As more fully reported in the Company’s Form 8-K (filed with the SEC on June 20, 2013), on June 17, 2013, AMVAC Chemical Corporation (“AMVAC”), the Company’s principal operating subsidiary, as borrower, and affiliates (including the Company), as guarantors and/or borrowers, entered into a Second Amended and Restated Credit Agreement (the “New Credit Agreement”) with a group of commercial lenders led by Bank of the West (AMVAC’s primary bank) as agent, swing line lender and L/C issuer. The new facility also includes both AMVAC C.V. and AMVAC Netherlands BV (both Dutch subsidiaries) as borrowers. The New Credit Agreement supersedes the Amended and Restated Credit Agreement (“First Amendment”) dated as of January 10, 2011 and more fully described in the Company’s Form 8-K filed on January 13, 2011. The New Credit Agreement is a senior secured lending facility with a five year term and consists of a revolving line of credit of $200 million and an accordion feature for up to $100 million. In connection with AMVAC’s entering into the New Credit Agreement, all outstanding indebtedness under the First Amendment was rolled over into the New Credit Agreement, including the conversion of term loans into revolving debt. At September 30, 2013, the Company had in place one interest rate swap contract with a notional amount of $38,625 that is accounted for under FASB ASC 815 as a cash flow hedge. The effective portion of the gains or losses on the interest rate swap are reported as a component of other comprehensive income and reclassified into earnings in the same period or periods during which the hedged transactions affect earnings. Losses in other comprehensive income expected to be reclassified to earnings in the coming 12 months are $596. Amounts recorded in earnings for hedge ineffectiveness for the period ending September 2013 were immaterial. The following tables illustrate the impact of derivatives on the Company’s consolidated statement of operations for the three months and nine months ended September 30, 2013. The Effect of Derivative Instruments on the Statement of Financial Performance For the Period Ended September 30 For the three months ended September 30
Derivatives in ASC 815 Cash Flow Hedging Relationships |  | Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion) |  |  | Location of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) |  | Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) |  |  | Location of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion) |  | Amount of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion) |
| 2013 |  |  | 2012 |  |  |  | 2013 |  |  | 2012 |  |  |  | 2013 |  |  | 2012 |
Interest rate contracts |  | $ | (43 | ) |  | $ | (137 | ) |  | Interest Expense |  | $ | (176 | ) |  | $ | (178 | ) |  | Interest Expense |  | $ | — |  |  | $ | — |
Total |  | $ | (43 | ) |  | $ | (137 | ) |  |  |  | $ | (176 | ) |  | $ | (178 | ) |  |  |  | $ | — |  |  | $ | — |
Derivatives Not Designated as Hedging Instruments under ASC 815 |  | Location of Gain or (Loss) Recognized in Income on Derivative |  | Amount of Gain or (Loss) Recognized in Income on Derivative |
|  | 2013 |  |  | 2012 |
Foreign Exchange contracts |  | Other income/(expense) |  | $ | — |  |  | $ | 115 |
Total |  |  |  | $ | — |  |  | $ | 115 |
For the nine months ended September 30
Derivatives in ASC 815 Cash Flow Hedging Relationships |  | Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion) |  |  | Location of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) |  | Amount of Gain or (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) |  |  | Location of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion) |  | Amount of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion) |
| 2013 |  |  | 2012 |  |  |  | 2013 |  |  | 2012 |  |  |  | 2013 |  |  | 2012 |
Interest rate contracts |  | $ | (59 | ) |  | $ | (460 | ) |  | Interest Expense |  | $ | (543 | ) |  | $ | (546 | ) |  | Interest Expense |  | $ | (1 | ) |  | $ | (1 | )
Total |  | $ | (59 | ) |  | $ | (460 | ) |  |  |  | $ | (543 | ) |  | $ | (546 | ) |  |  |  | $ | (1 | ) |  | $ | (1 | )
Derivatives Not Designated as Hedging Instruments under ASC 815 |  | Location of Gain or (Loss) Recognized in Income on Derivative |  | Amount of Gain or (Loss) Recognized in Income on Derivative |
|  | 2013 |  |  | 2012 |
Foreign Exchange contracts |  | Other income/(expense) |  | $ | — |  |  | $ | (77 | )
Total |  |  |  | $ | — |  |  | $ | (77 | )
The Company has three key covenants to its senior, secured credit facility with its banking syndicate. The covenants are as follows: (1) the Company must maintain its borrowings below a certain consolidated funded debt ratio, (2) the Company has a limitation on its annual spending on the acquisition of fixed asset capital additions, and (3) the Company must maintain a certain consolidated fixed charge coverage ratio. As of September 30, 2013 the Company met all covenants in that credit facility. At September 30, 2013, based on its performance against the most restrictive covenants listed above, the Company had the capacity to increase its borrowings by up to $161,250 under the credit facility 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 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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