Note G – Debt and Receivables Securitization

The following table summarizes our long-term debt and short-term borrowings outstanding at May 31, 2015 and 2014:


(in thousands)	2015		2014
Short-term borrowings	$	90,550	$	10,362
4.55% senior notes due April 15, 2026		249,524		249,472
4.60% senior notes due August 10, 2024		150,000		150,000
6.50% senior notes due April 15, 2020		149,920		149,912
Term loans		30,429		4,235
Floating rate senior notes due December 17, 2014		-		100,000
Industrial revenue bonds due April 2019		-		2,024
Other		320		320

Total debt		670,743		666,325
Less: current maturities and short-term borrowings		91,391		111,535

Total long-term debt	$	579,352	$	554,790

We maintain a $100,000,000 revolving trade accounts receivable securitization facility (the “AR Facility”) that was available throughout fiscal 2015 and fiscal 2014. During the third quarter of fiscal 2015, we extended the maturity of the AR Facility to January 2018. Pursuant to the terms of the AR Facility, certain of our subsidiaries sell their accounts receivable without recourse, on a revolving basis, to Worthington Receivables Corporation (“WRC”), a wholly-owned, consolidated, bankruptcy-remote subsidiary. In turn, WRC may sell without recourse, on a revolving basis, up to $100,000,000 of undivided ownership interests in this pool of accounts receivable to a multi-seller, asset-backed commercial paper conduit (the “Conduit”). Purchases by the Conduit are financed with the sale of A1/P1 commercial paper. We retain an undivided interest in this pool and are subject to risk of loss based on the collectability of the receivables from this retained interest. Because the amount eligible to be sold excludes receivables more than 90 days past due, receivables offset by an allowance for doubtful accounts due to bankruptcy or other cause, concentrations over certain limits with specific customers and certain reserve amounts, we believe additional risk of loss is minimal. The book value of the retained portion of the pool of accounts receivable approximates fair value. As of May 31, 2015, the pool of eligible accounts receivable exceeded the $100,000,000 limit, and $60,000,000 of undivided interests in this pool of accounts receivable had been sold. Facility fees of $723,000, $652,000, and $983,000 were recognized within interest expense during fiscal 2015, fiscal 2014 and fiscal 2013, respectively.

We maintain a multi-year revolving credit facility (the “Credit Facility”) with a group of lenders. On April 23, 2015, the Company amended the terms of the Credit Facility, increasing commitments under the facility by $75,000,000, to a total of $500,000,000, and extending the maturity by three years to April 2020. Borrowings under the Credit Facility have maturities of less than one year and given that our intention has been to repay them within a year, they have been classified as short-term borrowings within current liabilities on our consolidated balance sheets. However, we can also extend the term of amounts borrowed by renewing these borrowings for the term of the Credit Facility. We have the option to borrow at rates equal to an applicable margin over the LIBOR, Prime or Fed Funds rates. The applicable margin is determined by our credit rating and was 1.39% at May 31, 2015. Borrowings outstanding under the Credit Facility totaled $24,915,000 at May 31, 2015.

The remaining balance of short-term borrowings at May 31, 2015, consisted of $5,635,000 outstanding under a $9,500,000 credit facility maintained by our consolidated affiliate in India, Worthington Nitin Cylinders, that matured in November 2014 and bears interest at a variable rate. The applicable variable rate was 15.25% at May 31, 2015. The borrowings outstanding under the Nitin credit facility are currently in default; however, the lender has not called the note. The Company settled its portion of the obligation in June 2015.

On April 15, 2014, we issued $250,000,000 aggregate principal amount of unsecured senior notes due on April 15, 2026 (the “2026 Notes”). The 2026 Notes bear interest at a rate of 4.55%. The 2026 Notes were sold to the public at 99.789% of the principal amount thereof, to yield 4.573% to maturity. We used a portion of the net proceeds from the offering to repay borrowings then outstanding under our revolving credit facilities. Approximately $3,081,000, $2,256,000 and $528,000 of the aggregate proceeds were allocated to the settlement of a derivative contract entered into in anticipation of the issuance of the 2026 Notes, debt issuance costs, and the debt discount, respectively. The debt discount, debt issuance costs and the loss on the derivative contract were recorded on the consolidated balance sheet as of May 31, 2015, within long-term debt as a contra-liability, short- and long-term other assets and AOCI, respectively. Each will be recognized, through interest expense, in our consolidated statements of earnings over the term of the 2026 Notes. The unamortized portion of the debt issuance costs and debt discount was $1,881,000 and $476,000, respectively, at May 31, 2015.

On August 10, 2012, we issued $150,000,000 aggregate principal amount of unsecured senior notes due August 10, 2024 (the “2024 Notes”). The 2024 Notes bear interest at a rate of 4.60%. The net proceeds from this issuance were used to repay a portion of the outstanding borrowings under our multi-year revolving credit facility and amounts outstanding under our revolving trade accounts receivable securitization facility.

On April 13, 2010, we issued $150,000,000 aggregate principal amount of unsecured senior notes due on April 15, 2020 (the “2020 Notes”). The 2020 Notes bear interest at a rate of 6.50%. The 2020 Notes were sold to the public at 99.890% of the principal amount thereof, to yield 6.515% to maturity. We used the net proceeds from the offering to repay a portion of the then outstanding borrowings under our multi-year revolving credit facility and amounts then outstanding under our revolving trade accounts receivable securitization facility. Approximately $165,000, $1,535,000 and $1,358,000 of the aggregate proceeds were allocated to the debt discount, debt issuance costs, and the settlement of a derivative contract entered into in anticipation of the issuance of the 2020 Notes. The debt discount, debt issuance costs and the loss on the derivative contract were recorded on the consolidated balance sheets within long-term debt as a contra-liability, short- and long-term other assets and AOCI, respectively. Each will continue to be recognized, through interest expense, in our consolidated statements of earnings over the remaining term of the 2020 Notes. The unamortized portion of the debt issuance costs and debt discount was $582,000 and $80,000, respectively, at May 31, 2015.

On September 26, 2014, our consolidated joint venture in Turkey, Worthington Aritas, executed a $28,028,000 five-year term loan denominated in Euros. As of May 31, 2015, we had borrowed $27,013,000 against the facility. The facility bears interest at a variable rate based on EURIBOR. The applicable variable rate was 1.519% at May 31, 2015. On October 15, 2014, we entered into an interest rate swap to fix the interest rate on $16,809,000 of borrowings under this facility at 2.015% starting on December 26, 2014 through September 26, 2019. Borrowings against the facility are being used for the construction of a new cryogenics manufacturing facility in Turkey.

On April 27, 2012, we executed a $5,880,000 seven-year term loan that matures on May 1, 2019 and requires monthly payments of $76,350. The loan bears interest at a rate of 2.49% and is secured by an aircraft that was purchased with its proceeds. Borrowing outstanding totaled $3,416,000 as of May 31, 2015.

Maturities on long-term debt and short-term borrowings in the next five fiscal years, and the remaining years thereafter, are as follows:


(in thousands)
2016		91,391
2017		862
2018		6,286
2019		6,232
2020		166,207
Thereafter		400,000

Total	$	670,978