12.

Long-Term Debt


	As of December 31,
	2012		2011
	(in millions)
Convertible Debentures	$	149.0	$	142.1
Revolving debt		34.2		4.0
Other notes payable		2.1		4.1

		185.3		150.2
Less current maturities of long-term debt		1.0		1.6

	$	184.3	$	148.6

Debentures

We have $172.5 million outstanding in aggregate principal amount of Debentures. The Debentures bear interest at the annual rate of 3.9375%, with interest due on April 15 and October 15 of each year, and will mature on October 15, 2015, unless they are converted prior to that date. The Debentures are direct, unsecured and unsubordinated obligations and rank equal in priority with all unsecured and unsubordinated indebtedness and senior in right of payment to all subordinated indebtedness. They effectively rank junior to all secured indebtedness to the extent of the value of the assets securing such indebtedness. The Debentures do not contain financial covenants.

Holders may convert the Debentures under certain circumstances. Upon conversion of any Debentures, the principal amount would be settled in cash and the premium, if any, in shares of our common stock. The initial conversion rate, which is subject to adjustment, is 29.5972 shares of common stock per $1,000 principal amount of Debentures. This is equal to an initial conversion price of $33.79 per share. The Debentures may be converted under any of the following circumstances:

•

during any fiscal quarter (and only during such fiscal quarter), if the closing price of our common stock for at least 20 trading days in the 30 consecutive trading-day period ending on the last trading day of the preceding fiscal quarter was 130% or more of the then current conversion price per share of common stock on that 30^th trading day;

•

during the five business day period after any five consecutive trading-day period (which is referred to as the “measurement period”) in which the trading price per debenture for each day of the measurement period was less than 98% of the product of the closing price of our common stock and the applicable conversion rate for the debentures;

•

on or after September 15, 2015;

•

upon the occurrence of specified corporate transactions; or

•

in connection with a transaction or event constituting a “change of control.”

None of the conditions that permit conversion were satisfied at December 31, 2012.

We used a portion of the net proceeds from the sale of the Debentures to enter into call options (hedge and warrant transactions), which entitle us to purchase shares of our stock from a financial institution at $33.79 per share and entitle the financial institution to purchase shares from us at $46.78 per share. This will reduce potential dilution to our common shareholders from conversion of the Debentures by increasing the effective conversion price to $46.78 per share.

Credit Facility

Our primary U.S. operating subsidiaries, other than GST LLC, are parties to a senior secured revolving credit facility with a maximum availability of $175 million. Actual borrowing availability under the credit facility is determined by reference to a borrowing base of specified percentages of eligible accounts receivable, inventory, equipment and real property elected to be pledged, and is reduced by usage of the facility, including outstanding letters of credit, and any reserves. Under certain conditions, we may request an increase to the facility maximum availability to $225 million in total. Any increase is dependent on obtaining future lender commitments for those amounts, and no current lender has any obligation to provide such commitment. The credit facility matures on July 17, 2015 unless, prior to that date, the Debentures are paid in full, refinanced on certain terms or defeased, in which case the facility will mature on March 30, 2016.

Borrowings under the credit facility are secured by specified assets of the Company and our U.S. operating subsidiaries, other than GST LLC, and primarily include accounts receivable, inventory, equipment, real property elected to be pledged, deposit accounts, intercompany loans, intellectual property and related contract rights, general intangibles related to any of the foregoing and proceeds related to disposal or sale of the foregoing. Subsidiary capital stock is not included as collateral.

Outstanding borrowings under the credit facility bear interest at a rate equal to, at our option, either (1) a base/prime rate plus an applicable margin or (2) the adjusted one, two, three or six-month LIBOR rate plus an applicable margin. Pricing under the credit facility at any particular time is determined by reference to a pricing grid based on average daily availability under the facility for the immediately prior fiscal quarter. Under the pricing grid, the applicable margins range from 0.75% to 1.25% for base/prime rate loans and from 1.75% to 2.25% for LIBOR loans. At December 31, 2012, the applicable margin for base/prime rate loans was 1.00% and the applicable margin for LIBOR loans was 2.00%. The undrawn portion of the credit facility is subject to an unused line fee. Outstanding letters of credit are subject to an annual fee equal to the applicable margin for LIBOR loans under the credit facility as in effect from time to time, plus a fronting fee on the aggregate undrawn amount of the letters of credit.

The credit agreement contains customary covenants and restrictions for an asset-based credit facility, including negative covenants limiting certain: fundamental changes (such as merger transactions); loans; incurrence of debt other than specifically permitted debt; transactions with affiliates that are not on arm’s-length terms; incurrence of liens other than specifically permitted liens; repayment of subordinated debt (except for scheduled payments in accordance with applicable subordination documents); prepayments of other debt; dividends; asset dispositions other than as specifically permitted; and acquisitions and other investments other than as specifically permitted. The credit facility also requires us to maintain a minimum fixed charge coverage ratio in the event the amount available for borrowing is less than certain calculated amounts which vary based on the available borrowing base and the aggregate commitments of the lenders under the credit facility.

The credit facility contains events of default including, but not limited to, nonpayment of principal or interest, violation of covenants, breaches of representations and warranties, cross-default to other debt, bankruptcy and other insolvency events, material judgments, certain ERISA events, actual or asserted invalidity of loan documentation and certain changes of control.

The actual borrowing availability at December 31, 2012, under our senior secured revolving credit facility was $90.7 million after giving consideration to $3.8 million of letters of credit outstanding and $34.2 million of revolver borrowings.

Future principal payments on long-term debt are as follows:


	(in millions)
2013	$	1.0
2014		0.2
2015		206.8
2016		0.1
2017		0.1
Thereafter		0.6

	$	208.8

The payments for long-term debt shown in the table above reflect the contractual principal amount for the convertible debentures. In the Consolidated Balance Sheets, this amount is shown net of a debt discount pursuant to applicable accounting rules.