Debt

Borrowing Arrangements

The Company maintains a borrowing arrangement with a syndicate of banks, which was amended on December 7, 2011, and provides the Company with $735.0 million (“Line A”) in short-term lines of credit and $115.0 million (“Line B”) in long-term lines of credit. It also provides the Company with $90 million in letters of credit. Any amounts outstanding on letters of credit will reduce the amount available on the lines of credit. The Company had standby letters of credit outstanding of $29.9 million at December 31, 2013. As of December 31, 2013, the Company had no outstanding borrowings on the lines of credit. Borrowings under the line(s) of credit bear interest at variable interest rates, which are based off LIBOR plus an applicable spread. The maturity date for Line A is December 2014. The maturity date for Line B is September 2015. Draw downs and repayments that are less than 90 days are recorded on a net basis in the Consolidated Statements of Cash Flows.

The Company also has $28.1 million of lines of credit related to The Andersons Denison Ethanol LLC ("TADE"), a consolidated subsidiary. TADE entered into borrowing arrangements with a syndicate of financial institutions upon acquisition of the entity in the second quarter of 2012 which provides a $13.0 million short-term line of credit, a $15.1 million long-term line of credit, and a $12.4 million term loan. TADE had standby letters of credit outstanding of $0.5 million at December 31, 2013, which reduces the amount available on the lines of credit. As of December 31, 2013, the Company had no outstanding borrowings on the lines of credit and $10.1 million in borrowings were outstanding on the term loan. Borrowings under the line(s) of credit and the term loan bear interest at variable interest rates, which are based off LIBOR plus an applicable spread. The maturity date for the short-term line of credit is July 1, 2014, January 20, 2022 for the long-term line of credit and January 1, 2017 for the term loan. TADE was in compliance with all financial and non-financial covenants as of December 31, 2013, including but not limited to minimum working capital and net worth. TADE debt is collateralized by the mortgage on the ethanol facility and related equipment or other assets and is not guaranteed by the Company, therefore it is considered non-recourse debt.

The long-term portion of the syndicate line can be drawn on and the resulting debt considered long-term when used for long-term purposes such as replacing long-term debt that is maturing, funding the purchase of long-term assets, or increasing permanent working capital when needed. The expectation at the time of drawing is that it will be kept open until more permanent replacement debt is established, until other long-term assets are sold, or earnings are generated to pay it down.

The Company’s short-term and long-term debt at December 31, 2013 and December 31, 2012 consisted of the following:



(in thousands)	December 31, 2013		December 31, 2012
Borrowings under short-term line of credit - nonrecourse	$	—	$	4,219
Borrowings under short-term line of credit - recourse	—		20,000
Total borrowings under short-term line of credit	$	—	$	24,219
Current maturities of long -term debt – nonrecourse	$	6,012	$	2,496
Current maturities of long-term debt – recourse	45,986		12,649
Total current maturities of long-term debt	$	51,998	$	15,145
Long-term debt, less current maturities – nonrecourse	$	4,063	$	20,067
Long-term debt, less current maturities – recourse	371,150		407,176
Total long-term debt, less current maturities	$	375,213	$	427,243

The following information relates to short-term borrowings:



	December 31,
(in thousands, except percentages)	2013			2012			2011
Maximum amount borrowed	$	315,000		$	553,400		$	601,500
Weighted average interest rate	1.92		%	1.96		%	2.73		%

Long-Term Debt

Recourse Debt

Long-term debt consists of the following:



	December 31,
(in thousands, except percentages)	2013		2012
Senior note payable, 3.72%, payable at maturity, due 2017	$	25,000	$	25,000
Senior note payable, 6.10%, payable at maturity, due 2014	25,000		25,000
Senior note payable, 6.12%, payable at maturity, due 2015	61,500		61,500
Senior note payable, 6.78%, payable at maturity, due 2018	41,500		41,500
Note payable, 4.92%, $2 million annually ($2.5 million for 2013), plus interest, due 2021 (a)	27,178		27,833
Note payable, 4.76%, payable in increasing amounts ($1.7 million for 2013) plus interest, due 2028 (a)	53,600		55,300
Note payable, variable rate (2.67% at December 31, 2013), payable in increasing amounts ($1.2 million for 2013) plus interest, due 2023 (a)	23,015		24,188
Note payable, 3.29%, payable in increasing amounts ($1.2 million for 2013) plus interest, due 2022 (a)	25,366		26,533
Line of credit, variable rate (1.87% at December 31, 2013), payable at maturity, due 2015	—		25,000
Notes payable, variable rate (1.42% at December 31, 2013), payable in varying amounts, (7.6 million for 2013) plus interest, due 2016	22,120		12,058
Note payable, variable rate (1.64% at December 31, 2013), payable in increasing amounts ($1.0 million for 2013) plus interest, due 2023 (a)	11,865		12,815
Note payable, variable rate (.97% at December 31, 2013), $0.7 million annually, plus interest, due 2016 (a)	8,750		9,450
Note payable, 8.5%, payable monthly in varying amounts ($0.1 million for 2013) plus interest, due 2016 (a)	988		1,079
Note payable, 4.76%, payable quarterly in varying amounts ($0.2 million for 2013) plus interest, due 2028 (a)	9,980		—
Note payable, 3.56%, payable monthly in varying amounts plus interest, due 2021 (a)	3,459		—
Industrial development revenue bonds:
Variable rate (2.55% at December 31, 2013), payable at maturity, due 2017 (a)	7,934		8,408
Variable rate (1.97% at December 31, 2013), payable at maturity, due 2019 (a)	4,650		4,650
Variable rate (2.10% at December 31, 2013), payable at maturity, due 2025 (a)	3,100		3,100
Variable rate (1.81% at December 31, 2013), payable at maturity, due 2036 (a)	21,000		21,000
Debenture bonds, 2.65% to 5.00%, due 2014 through 2028	41,131		35,411
	417,136		419,825
Less: current maturities	45,986		12,649
	$	371,150	$	407,176


(a)	Debt is collateralized by first mortgages on certain facilities and related equipment or other assets with a book value of $151.7 million

During the year, the Company obtained a $10.2 million, fifteen-year loan with a fixed interest rate of 4.76%, which is collateralized by the mortgage of a grain facility. The Company also obtained a $3.5 million, eight-year loan with fixed interest rate of 3.56%, which is secured by certain railcar assets.

At December 31, 2013, the Company had $4.5 million of five-year term debenture bonds bearing interest at 2.65%, $3.7 million of ten-year term debenture bonds bearing interest at 3.50% and $3.8 million of fifteen-year term debenture bonds bearing interest at 4.50% available for sale under an existing registration statement.

The Company's short-term and long-term borrowing agreements include both financial and non-financial covenants that, among other things, require the Company at a minimum to maintain:


•	tangible net worth of not less than $300 million;


•	current ratio net of hedged inventory of not less than 1.25 to 1.00;


•	debt to capitalization ratio of not more than 70%;


•	asset coverage ratio of not more than 75%; and


•	interest coverage ratio of not less than 2.75 to 1.00.

The Company was in compliance with all covenants at and during the years ended December 31, 2013 and 2012.

The aggregate annual maturities of long-term debt are as follows: 2014 -- $46.0 million; 2015 -- $86.1 million; 2016 -- $26.4 million; 2017 -- $46.8 million; 2018 -- $51.9 million; and $159.9 million thereafter.

Non-Recourse Debt

The Company's non-recourse long-term debt consists of the following:



	December 31,
(in thousands, except percentages)	2013		2012
Line of credit, variable rate (3.92% at December 31, 2013), payable at maturity, due 2022	$	—	$	9,378
Note payable, variable rate (3.92% at December 31, 2013), payable quarterly ($2.3 million for 2013) plus interest, due 2017	10,075		12,400
Other notes payable	—		785
	10,075		22,563
Less: current maturities	6,012		2,496
	$	4,063	$	20,067

The Company's non-recourse debt held by TADE includes separate financial covenants relating solely to the collateralized TADE assets. Triggering one or more of these covenants for a specified period of time could result in the acceleration in amortization of the outstanding debt. The covenants require the following:


•	tangible net worth of not less than $27 million (increasing to $33 million effective December 31, 2014, $36 million effective December 31, 2015 and $40 million effective December 31, 2016);


•	working capital not less than $5.0 million (increasing to $8 million effective December 31, 2014); and


•	debt service coverage ratio of not less than 1.25 to 1.00 beginning December 31, 2014.

The aggregate annual maturities of non-recourse, long-term debt are as follows: 2014 -- $6.0 million; 2015 -- $3.1 million; and 2016 -- $1.0 million.

Interest paid (including interest on short-term lines of credit) amounted to $22.9 million, $21.7 million and $25.2 million in 2013, 2012 and 2011, respectively.