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Debt
6 Months Ended
Jun. 30, 2013
Debt [Abstract]  
Debt

NOTE 11.  DEBT

On March 15, 2013, we refinanced our $1.3 billion senior credit facility and amended the underlying credit agreement.  The new facility is composed of a $250 million revolving credit facility (with a $150 million sublimit for letters of credit), a $550 million Term Loan A and a $475 million Term Loan B.  The terms of the facility resulted in a lower interest rate spread (2.5% vs. 3.0%) than our previous facility.  We also extended the maturity of Term Loan A from November 2015 to March 2018 and of Term Loan B from March 2018 to March 2020

 

The primary covenant change resulting from the refinancing related to mandatory prepayments required under the senior credit facility.  This is an annual leverage test beginning with the year ending December 31, 2013, where, if our ratio of consolidated funded indebtedness minus AWI and domestic subsidiary unrestricted cash and cash equivalents up to $100 million to consolidated EBITDA (“Consolidated Net Leverage Ratio”) is greater than or equal to 3.5 to 1.0, we would be required to make a prepayment of 50% of fiscal year Consolidated Excess Cash Flow, as defined by the credit agreement.  If our Consolidated Net Leverage Ratio is less than 3.5 to 1.0, no prepayment would be required.  This test is on a fiscal year basis, except for the first period ending December 31, 2013, for which the Consolidated Excess Cash Flow is calculated for the period April 1, 2013 to December 31, 2013.  During the first six months of 2013, we were in compliance with all covenants of the previous and amended senior credit facilities. 

 

In connection with the refinancing, we incurred $8.3 million for bank, legal, and other fees, of which $7.2 million was capitalized and is being amortized into interest expense over the life of the loans.  Additionally, we wrote off $18.9 million of unamortized debt financing costs in the first quarter of 2013 related to our previous credit facility to interest expense.

 

On March 28, 2013, we amended our $100 million Accounts Receivable Securitization Facility with the Bank of Nova Scotia.  We decreased the facility to $75 million to reduce commitment fees on unused capacity.  The maturity was extended to March 2016.  The balance of the subordinated notes payable, which is eliminated in consolidation, totaled $139.4 million as of June 30, 2013