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FINANCING ARRANGEMENTS | 3 Months Ended
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Sep. 30, 2011
FINANCING ARRANGEMENTS: |
FINANCING ARRANGEMENTS: |
9. FINANCING ARRANGEMENTS: The table below contains details related to the Company’s debt for the three months ending September 30, 2011 and 2010:
|  | For the Three Months Ended September 30, |
Total Debt |  | 2011 |  | 2010 |
|  | (Dollars in Thousands) |
Balance at June 30, |  | $ | 313,411 |  | $ | 440,029 |
Repayment of long-term debt and capital lease obligations |  | (9,669 | ) | (3,334 | )
Amortized debt discount |  | 1,183 |  | 1,086 |
Other |  | (910 | ) | 1,888 |
Balance at September 30, |  | $ | 304,015 |  | $ | 439,669 |
In September 2011 the Company entered into an agreement to refinance existing capital leases to a three year term with a contract rate of 4.9 percent. Capital leases of $20.5 million will be amortized at the historical rate of 9.2 percent. There was no gain or loss recorded on the refinance. The Company entered into the refinancing to reduce cash interest payments. In July 2009, the Company issued $172.5 million aggregate principal amount of 5.0 percent convertible senior notes due July 2014. The notes are unsecured, senior obligations of the Company and interest will be payable semi-annually in arrears on January 15 and July 15 of each year at a rate of 5.0 percent per year. Upon the July 2009 issuance the notes were convertible subject to certain conditions further described below at an initial conversion rate of 64.6726 shares of the Company’s common stock per $1,000 principal amount of notes (representing an initial conversion price of approximately $15.46 per share of the Company’s common stock). As of September 30, 2011, the conversion rate was 64.9168 shares of the Company’s common stock per $1,000 principal amount of notes (representing a conversion price of approximately $15.40 per share of the Company’s common stock). Holders may convert their notes at their option prior to April 15, 2014 if the Company’s stock price meets certain price triggers or upon the occurrence of specified corporate events as defined in the convertible senior note agreement. On or after April 15, 2014, holders may convert each of their notes at their option at any time prior to the maturity date for the notes. The Company has the choice of net-cash settlement, settlement in its own shares or a combination thereof and concluded the conversion option is indexed to its own stock. As a result, the Company allocated $24.7 million of the $172.5 million principal amount of the convertible senior notes to equity, which resulted in a $24.7 million debt discount. The allocation was based on measuring the fair value of the convertible senior notes using a discounted cash flow analysis. The discount rate was based on an estimated credit rating for the Company. The estimated fair value of the convertible senior notes was $147.8 million, the resulting $24.7 million debt discount will be amortized over the period the convertible senior notes are expected to be outstanding, which is five years, as additional non-cash interest expense. The combined debt discount amortization and the contractual interest coupon resulted in an effective interest rate on the convertible debt of 8.9 percent. The following table provides equity and debt information for the convertible senior notes:
|  | September 30, |
Convertible Senior Notes Due 2014 |  | 2011 |  | 2010 |
|  | (Dollars in Thousands) |
Principal amount on the convertible senior notes |  | $ | 172,500 |  | $ | 172,500 |
Unamortized debt discount |  | (15,069 | ) | (19,653 | )
Net carrying amount of convertible debt |  | $ | 157,431 |  | $ | 152,847 |
The following table provides interest rate and interest expense amounts related to the convertible senior notes:
|  | For the Three Months Ended September 30, |
Convertible Senior Notes Due 2014 |  | 2011 |  | 2010 |
|  | (Dollars in thousands) |
Interest cost related to contractual interest coupon — 5.0% |  | $ | 2,156 |  | $ | 2,156 |
Interest cost related to amortization of the discount |  | 1,183 |  | 1,086 |
Total interest cost |  | $ | 3,339 |  | $ | 3,242 |

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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 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 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 129 -Paragraph 2, 4 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 3: 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 4: 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 + Details
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