DEBT OBLIGATIONS

Short-term debt obligations

There were $1.0 million and $0.6 million of short-term debt obligations outstanding as of December 31, 2011 and 2010, respectively, with a weighted average interest rate of 7.3% and 5.9%, respectively.

Long-term debt obligations

Long-term debt obligations consist of the following as of December 31, 2011 and 2010:



	As of December 31,
(in thousands)	2011			2010
3.50% convertible debentures, unsecured, due 2025	$	165,173		$	161,005
Term loan, due 2016	79,000			—
Revolving credit agreements	87,194			—
Term loan, due 2014	—			127,000
	331,367			288,005
Less current maturities of long-term debt obligations	(169,673		)	(1,900		)
Long-term debt obligations	$	161,694		$	286,105

On August 18, 2011, the Company and certain of its subsidiaries entered into an Amended and Restated Credit Agreement (the "Credit Agreement") with a lending syndicate consisting of nine banks (the "Lenders") with Bank of America, N.A. serving as Administrative Agent and Collateral Agent and U.S. Bank National Association serving as Syndication Agent. Under the Credit Agreement, the Lenders have made available a $355 million senior secured credit facility (the "Credit Facility") consisting of a $265 million five-year revolving credit facility, a $10 million five-year India revolving credit facility and an $80 million five-year term loan which was fully drawn at closing. The revolving credit facility allows for borrowings in U.S. dollars, euro, British pound sterling, Australian dollars and/or Indian rupees. The Credit Agreement amends and extends the credit agreement dated as of April 4, 2007 and all subsequent amendments thereto, which consisted of a $100 million revolving line of credit and $126 million outstanding term loan maturing April 2012 and 2014, respectively.

The $265 million revolving credit facility contains a $200 million sublimit for the issuance of letters of credit and a $25 million sublimit for swingline loans. Subject to certain conditions, the Company has the option to increase the Credit Facility by up to an additional $205 million by requesting additional commitments from existing or new lenders. Fees and interest on borrowings vary based upon the Company's consolidated total leverage ratio (as defined in the Credit Agreement) and will be based, in the case of letter of credit fees, on a margin, and in the case of interest, on a margin over London Inter-Bank Offered Rate (“LIBOR”) or a margin over the base rate, as selected by the Company, with the applicable margin ranging from 1.5% to 2.5% (or 0.5% to 1.5% for base rate loans). The base rate is the highest of (i) the Bank of America prime rate, (ii) the Federal Funds rate plus 0.50% or (iii) the Fixed LIBOR rate plus 1.00%. The term loan is subject to scheduled quarterly amortization payments, as set forth in the Credit Agreement. The maturity date for the Credit Facility is five years from the closing date, at which time the outstanding principal balance and all accrued interest will be due and payable in full. The weighted average interest rate of the Company's borrowings was 2.8% under the revolving credit facility and 2.3% under the term loan as of December 31, 2011. Financing costs of $4.4 million have been deferred and are being amortized over the terms of the respective loans and $1.7 million were written off and included in loss on early retirement of debt in the Consolidated Statement of Operations.

The Credit Agreement contains customary affirmative and negative covenants, events of default and financial covenants, including (all as defined in the Credit Agreement): (i) a Consolidated Total Leverage Ratio not to exceed 4.0 to 1.0; (ii) a Consolidated Senior Secured Leverage Ratio not to exceed 3.0 to 1.0; and (iii) a Consolidated Fixed Charge Coverage Ratio of not less than 1.5 to 1.0. Subject to meeting certain leverage ratio and liquidity requirements (as defined in the Credit Agreement), the Company is permitted to pay dividends, repurchase common stock and repurchase subordinated debt.

The Company and certain subsidiaries have guaranteed the repayment of obligations under the Credit Facility and have granted pledges of the shares of certain subsidiaries along with a security interest in certain other personal property collateral of the Company and certain subsidiaries.

On October 4, 2005, the Company completed the sale of $175.0 million of 3.50% Contingent Convertible Debentures Due 2025 (“Convertible Debentures”). The Convertible Debentures have an interest rate of 3.50% per annum payable semi-annually in April and October, and are convertible into shares of Euronet Common Stock at a conversion price of $40.48 per share if certain conditions are met (relating to the closing prices of Euronet Common Stock exceeding certain thresholds for specified periods). The Convertible Debentures may not be redeemed by the Company until October 20, 2012 but are redeemable at any time thereafter at par. Holders of the Convertible Debentures have the option to require the Company to purchase their debentures at par on October 15, 2012, 2015 and 2020, or upon a change in control of the Company. These terms and other material terms and conditions applicable to the Convertible Debentures are set forth in the indenture governing the debentures. In connection with the Convertible Debentures, the Company recorded $5.1 million in debt issuance costs, which is being amortized over seven years, the term of the initial put option by the holders of the Convertible Debentures. The Convertible Debentures are general unsecured obligations, and are subordinated in right of payment to all obligations under “Senior Debt,” which is defined to include secured credit facilities (including secured replacements, renewals or refinancings thereof, including with different lenders and in higher amounts) and will rank equally in right of payment with all other existing and future unsecured obligations and senior in right of payment to all future subordinated indebtedness. The Convertible Debentures will be effectively subordinated to any existing and future secured indebtedness, with respect to any collateral securing such indebtedness and all liabilities of Euronet's subsidiaries. The Convertible Debentures are not guaranteed by any of Euronet's subsidiaries and, accordingly, are effectively subordinated to the indebtedness and other liabilities of Euronet's subsidiaries, including trade creditors. The Company and its subsidiaries are not restricted under the indenture from incurring additional secured indebtedness, Senior Debt or other additional indebtedness.

In September 2011, the Company repurchased $3.6 million in principal amount of the 3.50% convertible debentures which resulted in a loss on early retirement of debt of $0.2 million. The 3.50% convertible debentures had principal amounts outstanding of $171.4 million and $175.0 million and unamortized discounts outstanding of $6.3 million and $14.0 million as of December 31, 2011 and 2010, respectively. The discount will be amortized through October 15, 2012. Contractual interest expense was $6.1 million for each of the years ended December 31, 2011, 2010 and 2009. Discount accretion was $7.6 million, $7.1 million and $6.5 million for the years ended December 31, 2011, 2010 and 2009, respectively. The effective interest rate was 8.4% for the years ended December 31, 2011, 2010 and 2009.

On December 15, 2004, the Company completed the sale of $140.0 million of 1.625% Contingent Convertible Senior Debentures Due 2024 (“Convertible Senior Debentures”). During the year ended December 31, 2009, the Company repurchased in privately negotiated transactions $25.8 million in principal amount of the Convertible Senior Debentures which resulted in $0.2 million in pre-tax losses on early retirement of debt, net of the write-off of unamortized debt issuance costs. Effective December 15, 2009, most of the holders of the Convertible Senior Debentures exercised their option to require the Company to purchase their debentures at par and $43.0 million in principal amount were purchased. The Company elected to redeem the remaining$1.2 million of outstanding debentures at par in January 2010, along with accrued interest at the rate of 1.625% per annum. Contractual interest expense and discount accretion for the 1.625% convertible debentures was $1 thousand for the year ended December 31, 2010 and $3.4 million for the year ended December 31, 2009. The effective interest rate was 1.625% for the year ended December 31, 2010 and 7.1% for the year ended December 31, 2009.

As of December 31, 2011, the Company had $87.2 million in borrowings and $35.3 million in stand-by letters of credit/bank guarantees outstanding against the revolving credit facility. As of December 31, 2010, the Company had no borrowings and $41.7 million in stand-by letters of credit/bank guarantees outstanding against the revolving credit facility. Stand-by letters of credit/bank guarantees are generally used to secure trade credit and performance obligations. The Company pays an interest rate for stand-by letters of credit/bank guarantees at a rate that adjusts each quarter based upon the Company's consolidated total leverage ratio. At December 31, 2011, the stand-by letter of credit interest charges were 2.0% per annum. Because the revolving credit agreements expire beyond one year, the borrowings were classified as long-term debt obligations in the Consolidated Balance Sheets.

As of December 31, 2011, aggregate annual maturities of long-term debt are $175.9 million in 2012, $6.5 million in 2013, $8.5 million in 2014, $11.5 million in 2015 and $135.2 million in 2016. This maturity schedule reflects the term loan and revolving credit facilities maturing in 2016 and the 3.5% Convertible Debentures maturing in 2012, coinciding with the terms of the initial put option by the holders of the debentures.