Annual report pursuant to Section 13 and 15(d)

Long-Term Debt

v2.4.0.6
Long-Term Debt
12 Months Ended
Dec. 31, 2011
Long-Term Debt [Abstract]  
Long-Term Debt

Note 2. Long-term Debt

Long-term debt consisted of the following:

 

     December 31,  

(In thousands)

   2011     2010  

Senior notes

   $ 262,857     $ 203,572  

Revolving credit facility

     0       66,230  

Capitalized lease and other obligations

     6,328       1,415  
  

 

 

   

 

 

 

Total long-term debt

     269,185       271,217  

Less: Current maturities

     (39,354     (37,130
  

 

 

   

 

 

 

Total maturities due after one year

   $ 229,831     $ 234,087  
  

 

 

   

 

 

 

We have three outstanding unsecured senior note agreements with an aggregate amount outstanding of $262.9 million at December 31, 2011. These notes call for periodic principal payments with maturities that range from 2015 to 2021, of which $35.7 million is due in the next twelve months. Interest rates on these notes are fixed and range from 4.00% to 5.85%. The effective average interest rate on our outstanding senior note agreements was 5.17% and 5.54% at December 31, 2011 and 2010, respectively.

Included in our senior notes is $95.0 million related to a Note Purchase Agreement by and among the Company and the purchasers, dated as of January 3, 2011. Under this agreement, we issued $50.0 million of privately-placed Senior Notes, Tranche A (the "Tranche A Notes") and $45.0 million of privately-placed Senior Notes, Tranche B (the "Tranche B Notes" and, together with the Tranche A Notes, the "Notes") on January 3, 2011. The Notes are unsecured and rank equally in right of repayment with the Company's other senior unsecured indebtedness. The Tranche A Notes mature on January 3, 2018. The Company will pay interest on the unpaid balance of the Tranche A Notes at the rate of 4.00% per annum from the date of issuance. The Tranche B Notes mature on January 3, 2021. The Company will pay interest on the unpaid balance of the Tranche B Notes at the rate of 4.79% per annum from the date of issuance. The Company used a portion of the proceeds of the issuance of the Notes to refinance existing indebtedness, including paying down the outstanding balance on its senior unsecured revolving credit facility in January 2011.

We entered into a five-year, $200.0 million senior unsecured revolving credit facility pursuant to the terms of a second amended and restated credit agreement on August 10, 2011 (the "Credit Agreement"), with Wells Fargo Bank, National Association ("Wells Fargo") serving as administrative agent for the lenders. This Credit Agreement amended and restated the terms of the previous senior unsecured revolving credit facility dated August 10, 2006. Of the $200.0 million line of credit commitments, $150.0 million may be used for letters of credit and $20.0 million may be used for borrowings under the Wells Fargo Sweep Plus Loan Program. This sweep program is a daily cash management tool that automatically initiates borrowings to cover overnight cash requirements up to an aggregate of $20.0 million. In addition, we have the right to request an increase in the line of credit commitments up to a total of $300.0 million in minimum increments of $25.0 million. At our option, revolving loans under the facility bear interest at either: (a) the Applicable Margin Percentage for Base Rate Loans plus the higher of Wells Fargo's prime rate, the federal funds rate plus 0.5% per annum, or the one month LIBOR Rate plus 1.0% per annum; (b) the LIBOR Rate plus the Applicable Margin Percentage for LIBOR Loans; or (c) the LIBOR Market Index Rate ("LIBOR Index Rate") plus the Applicable Margin Percentage for LIBOR Market Index Loans. The Applicable Margin Percentage is determined by a pricing grid in the Credit Agreement and ranges from 1.0% to 1.875%. The Applicable Margin Percentage was 1.125% for the period this Credit Agreement was in effect during 2011. Revolving loans under the sweep program bear interest at the LIBOR Index Rate.

The Credit Agreement contains customary covenants, including financial covenants that require us to observe a maximum ratio of debt to total capital and a minimum fixed charge coverage ratio. Any future wholly-owned subsidiaries of the Company would be required to guarantee payment of all of our obligations under the facility. There was no outstanding balance on the line of credit facility at December 31, 2011. The outstanding balance of borrowings on the line of credit facility was $66.2 million at December 31, 2010. There were $49.9 million and $49.6 million of outstanding letters of credit at December 31, 2011 and 2010, respectively.

Commitment fees ranging from 0.175% to 0.30% are charged quarterly in arrears on the aggregate unutilized portion of the Credit Agreement. Letter of credit fees equal to the applicable margin for Adjusted LIBOR Rate loans are charged quarterly in arrears on the daily average aggregate stated amount of all letters of credit outstanding during the quarter. The commitment fees and letter of credit fees were 0.20% and 1.125%, respectively, for the period this Credit Agreement was in effect during 2011. In addition, the Company will pay to Wells Fargo for its own account as issuer of letters of credit (i) a facing fee with respect to each letter of credit in an amount equal to 0.125% of the daily average aggregate Stated Amount thereof, payable quarterly in arrears and calculated on an actual/360-day basis and (ii) such fees and charges customarily charged in connection with the issuance and administration of such letters of credit. Wells Fargo, as administrative agent, shall also receive an annual administrative fee for providing such services.

Our Credit Agreement limits the amount of dividends that could be paid to shareholders to the greater of (i) $20.0 million, (ii) the amount of dividends paid in the immediately preceding fiscal year, or (iii) an amount equal to 25% of net income from the immediately preceding fiscal year. We did not declare or pay a dividend on our common stock in 2011 or 2010, and we have no plans to declare or pay a dividend in 2012.

Our three outstanding senior note agreements and the Credit Agreement contain customary covenants, including financial covenants that require us to observe a maximum ratio of debt to total capital and a minimum fixed charge coverage ratio. Any future wholly-owned subsidiaries of the Company would be required to guarantee payment of all of our obligations under these agreements.

At December 31, 2010, the outstanding balance of borrowings on our previous line of credit facility of $66.2 million was reported as a long-term liability despite that facility's maturity within one year of the balance sheet date, as we utilized a portion of the $95.0 million of proceeds obtained from privately-placed senior notes issued on January 3, 2011 to refinance the outstanding balance on the Credit Agreement.

Capitalized lease obligations are collateralized by property and equipment with a book value of $9.2 million at December 31, 2011.

As of December 31, 2011, aggregate maturities of long-term debt are as follows:

 

(In thousands)

      

2012

   $ 39,354  

2013

     38,403  

2014

     35,714  

2015

     35,714  

2016

     25,000  

Thereafter

     95,000  
  

 

 

 
   $ 269,185