6.	BORROWINGS

Bank Facilities

As of March 31, 2012, the Company has outstanding liability of €25.0 million ($33.4 million) from the term loans from Zenit Bank, Alfa Bank and Raiffeisen Bank drawn by Whitehall:

•

The loan agreement with Zenit Bank, dated March 29, 2011, matures on June 6, 2012. The credit limit under this loan agreement is €10.0 million ($13.3 million) and the loan is released in tranches maturing in 365 days, no later than June 6, 2012. The loan was released in four tranches between April 21, 2011 and September 13, 2011, and is repayable between April 20, 2012 and May 18, 2012. As of March 31, 2012, the Company had outstanding liability of €5.0 million ($6.7 million) from this term loan;

•

The loan agreement with Alfa Bank, dated July 22, 2008, matures on October 18, 2014. The credit limit under this agreement is €20.0 million ($26.7 million) and the loan is released in tranches maturing within three, six or nine months, depending if they are pledged by inventory. The loan was released in eight tranches between September 14, 2011 and March 30, 2012, and is repayable between April 28, 2012 and October 30, 2012. As of March 31, 2012, the Company had outstanding liability of €15.1 million ($20.1 million) from this term loan;

•

The loan agreement with Raiffeisen Bank, dated July 6, 2010, matures on July 6, 2012. The credit limit under this agreement is €10.0 million ($13.3 million) and the loan is released in tranches maturing within one to 12 months, not later than July 6, 2012. The loan was released in five tranches between September 12, 2011 and October 26, 2011, and is repayable between May 18, 2012, and July 6, 2012. As of March 31, 2012, the Company had outstanding liability of €4.9 million ($6.5 million) from this term loan.

The aforementioned loans drawn by Whitehall are guaranteed by Whitehall companies. The loans from Zenit Bank and Alfa Bank are secured by the Company’s inventory.

As of March 31, 2012, the Company has outstanding term loans of 879.6 million Russian rubles ($30.0 million) from Unicredit and JSC Grand Invest Bank, both drawn by Russian Alcohol, as well as, an overdraft facility from Sberbank drawn by Bravo Premium:

•

The loan agreement with Unicredit, dated May 24, 2011, matures on November 23, 2012. This loan has no financial covenants and is secured by inventory of up to 720 million Russian rubles ($24.6 million) and guarantees given by companies of Russian Alcohol. As of March 31, 2012, the Company has outstanding liability of 600.0 million Russian rubles ($20.5 million) from this term loan;

•

The loan agreement with JSC Grand Invest Bank, dated November 25, 2011, matures on November 23, 2012. This loan has no financial covenants that need to be met. As of March 31, 2012, the Company has outstanding liability of 279.6 million Russian rubles ($9.5 million) from this term loan;

•

The overdraft agreement with Sberbank, dated February 6, 2012, matures on February 5, 2013. The credit limit under this agreement is 60.0 million Russian rubles ($2.0 million). This loan is secured by fixed assets. As of March 31, 2012, the Company has outstanding liability of 52.5 million Russian rubles ($1.8 million) from this overdraft facility.

As of March 31, 2012, the Company had available to use under existing overdraft facility in Hungary 100.0 million Hungarian forints ($0.5 million).

Convertible Senior Notes due 2013

On March 7, 2008, the Company completed the issuance of $310 million aggregate principal amount of 3% Convertible Senior Notes due 2013 (the “Convertible Senior Notes”). Interest is due semi-annually on the 15^th of March and September, beginning on September 15, 2008. The Convertible Senior Notes are convertible in certain circumstances into cash and, if applicable, shares of our common stock, based on an initial conversion rate of 14.7113 shares per $1,000 principal amount, subject to certain adjustments. Upon conversion of the notes, the Company will deliver cash up to the aggregate principal amount of the notes to be converted and, at the election of the Company, cash and/or shares of common stock in respect to the remainder, if any, of the conversion obligation. The proceeds from the Convertible Senior Notes were used to fund the cash portions of the acquisition of Copecresto Enterprises Limited and Whitehall.

As of March 31, 2012 and December 31, 2011, the Company had accrued interest of $0.4 million and $2.7 million, respectively, related to the Convertible Senior Notes, with the next coupon due for payment on September 15, 2012. Total obligations under the Convertible Senior Notes are shown net of deferred finance costs, amortized over the life of the borrowings using the effective interest rate method as shown in the table below:


	March 31,			December 31,
	2012			2011
Convertible Senior Notes	$	310,000		$	310,000
Unamortized debt discount		(851	)		(1,070	)
Debt discount related to ASC 470-20		(3,172	)		(4,285	)

Total	$	305,977		$	304,645

For the three months ended March 31, 2012 and March 31, 2011, the additional pre-tax non-cash interest expense recognized in the consolidated statement of operations was $1.1 million each. Accumulated amortization related to the debt discount was $16.5 million and $12.2 million as of March 31, 2012 and March 3 1, 2011, respectively. Pre-tax increase in non-cash interest expense on our consolidated statements of operations and comprehensive income to be recognized until 2013, the maturity date of the CSNs, amounts to $3.2 million.

Senior Secured Notes due 2016

On December 2, 2009, the Company issued $380 million 9.125% Senior Secured Notes due 2016 and €380 million ($507.0 million) 8.875% Senior Secured Notes due 2016 (the “2016 Notes”) in an unregistered offering to institutional investors. The Company used a portion of the net proceeds from the 2016 Notes to redeem the Company’s outstanding 2012 Notes, having an aggregate principal amount of €245.4 million ($327.4 million) on January 4, 2010. The remainder of the net proceeds from the 2016 Notes was used to (i) purchase Lion Capital’s remaining equity interest in Russian Alcohol by exercising the Lion Option and the Co-Investor Option, pursuant to the terms and conditions of the Lion Option Agreement and the Co-Investor Option Agreement, respectively (ii) repay all amounts outstanding under Russian Alcohol credit facilities; and (iii) repay certain other indebtedness.

On December 9, 2010, the Company issued an additional €50.0 million ($66.7 million) 8.875% Senior Secured Notes due 2016 (the “2016 Notes”) in an unregistered offering to institutional investors. The Company used the net proceeds from the additional 2016 Notes to repay its term loans and overdraft facilities with Bank Handlowy w Warszawie S.A and Bank Zachodni WBK S.A.

As of March 31, 2012 and December 31, 2011 the Company had accrued interest of $28.5 million and $7.0 million respectively, related to the Senior Secured Notes due 2016, with the next coupon due for payment on June 1, 2012.


	March 31,			December 31,
	2012			2011
Senior Secured Notes due 2016	$	953,705		$	935,296
Unamortized debt discount		(3,062	)		(3,207	)

Total	$	950,643		$	932,089


	March 31,
	2012
Principal repayments for the following years
2012	$	43,215
2013		327,912
2014		0
2015		0
2016 and beyond		950,643

Total	$	1,321,770