Debt

Borrowing Arrangements

The Company is party to borrowing arrangements with a syndicate of banks, which was amended on March 4, 2014, and provides the Company with $850 million in lines of credit. The Company can designate up to $400 million of borrowings as long-term when the debt is 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. It also provides the Company with up to $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 $32.5 million at December 31, 2016. As of December 31, 2016, the Company had $59.0 million of outstanding borrowings on the lines of credit. Borrowings under the lines of credit bear interest at variable interest rates, which are based off LIBOR plus an applicable spread. The maturity date for the lines of credit is March 2019. 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 a line of credit related to The Andersons Denison Ethanol LLC ("TADE"), a consolidated subsidiary. TADE entered into a borrowing arrangement with a syndicate of financial institutions in the second quarter of 2012 which provided a $21.3 million long-term line of credit. TADE had standby letters of credit outstanding of $0.2 million at December 31, 2016, which reduces the amount available on the lines of credit. As of December 31, 2016, the Company had no outstanding borrowings on the lines of credit. Borrowings under the lines of credit and the term loan bear interest at variable interest rates, which are based off LIBOR plus an applicable spread. The maturity date is May 20, 2020 for the long-term line of credit. TADE was in compliance with all financial and non-financial covenants as of December 31, 2016, 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 Company’s short-term and long-term debt at December 31, 2016 and 2015 consisted of the following:



	December 31,
(in thousands)	2016		2015
Short-term debt - non-recourse	$	—	$	—
Short-term debt - recourse	29,000		16,990
Total short-term debt	$	29,000	$	16,990
Current maturities of long-term debt – non-recourse	$	—	$	—
Current maturities of long-term debt – recourse	47,545		27,786
Total current maturities of long-term debt	$	47,545	$	27,786
Long-term debt, less current maturities – non-recourse	$	—	$	—
Long-term debt, less current maturities – recourse	397,065		436,208
Total long-term debt, less current maturities	$	397,065	$	436,208

The following information relates to short-term borrowings:



	December 31,
(in thousands, except percentages)	2016			2015			2014
Maximum amount borrowed	$	412,000		$	308,500		$	270,600
Weighted average interest rate	1.94		%	1.64		%	1.69		%

Long-Term Debt

Recourse Debt

Long-term debt consists of the following:



	December 31,
(in thousands, except percentages)	2016		2015
Note payable, 4.07%, payable at maturity, due 2021	$	26,000	$	—
Note payable, 3.72%, payable at maturity, due 2017	25,000		25,000
Note payable, 4.55%, payable at maturity, due 2023	24,000		—
Note payable, 4.85%, payable at maturity, due 2026	25,000		—
Note payable, 6.78%, payable at maturity, due 2018	41,500		41,500
Note payable, 4.92%, payable in increasing amounts ($2.2 million for 2016), plus interest, due 2021 (a)	20,443		22,666
Note payable, 4.76%, payable in increasing amounts ($2.0 million for 2016) plus interest, due 2028 (a)	47,990		49,949
Note payable, variable rate (3.12% at December 31, 2016), payable in increasing amounts ($1.3 million for 2016) plus interest, due 2023 (a)	19,179		20,513
Note payable, 3.29%, payable in increasing amounts ($1.3 million for 2016) plus interest, due 2022 (a)	21,619		22,913
Note payable, 4.23%, payable quarterly in varying amounts ($0.6 million for 2016) plus interest, due 2021 (a)	11,136		11,770
Notes payable, variable rate, due 2016	—		5,043
Note payable, variable rate (2.21% at December 31, 2016), payable in increasing amounts ($1.1 million for 2016) plus interest, due 2023 (a)	8,790		9,865
Note payable, variable rate, due 2016 (a)	—		7,350
Note payable, variable rate (2.45% at December 31, 2016), payable in varying amounts ($0.1 million for 2016), plus interest, due 2026 (a)	9,016		—
Note payable, 4.76%, payable quarterly in varying amounts ($0.4 million for 2016) plus interest, due 2028 (a)	8,956		9,313
Note payable, 2.21%, payable at maturity ($75.0 million for 2016) plus interest, due 2019	30,000		105,000
Note payable, 3.33%, payable in increasing amounts ($1.0 million for 2016) plus interest, due 2025 (a)	27,000		28,000
Note payable, 4.5%, payable at maturity, due 2030	16,000		16,000
Note payable, 5.0%, payable at maturity, due 2040	14,000		14,000
Industrial development revenue bonds:
Variable rate (3.05% at December 31, 2016), payable at maturity, due 2017 (a)	6,513		6,987
Variable rate (2.36% at December 31, 2016), payable at maturity, due 2019 (a)	4,650		4,650
Variable rate (2.31% at December 31, 2016), payable at maturity, due 2025 (a)	3,100		3,100
Variable rate (2.28% at December 31, 2016), payable at maturity, due 2036	21,000		21,000
Debenture bonds, 2.65% to 5.00%, due 2017 through 2031	36,931		39,375
	$	447,823	$	463,994
Less: current maturities	47,545		27,786
Less: unamortized prepaid debt issuance costs	3,213		—
	$	397,065	$	436,208


(a)	Debt is collateralized by first mortgages on certain facilities and related equipment or other assets with a book value of $179.3 million

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;


•	long-term debt to capitalization of not more than 70%;


•	working capital of not less than $150 million; and


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

The Company was in compliance with all financial covenants at and during the years ended December 31, 2016 and 2015.

The aggregate annual maturities of long-term debt are as follows: 2017 -- $47.5 million; 2018 -- $55.3 million; 2019 -- $46.9 million; 2020 -- $16.4 million; 2021 -- $62.3 million; and $219.4 million thereafter.

Non-Recourse Debt

The Company's non-recourse debt, including the lines of credit, held by TADE includes separate financial covenants relating solely to the collateralized TADE assets. The covenants require the following:


•	tangible net worth of not less than $36 million and increasing to $40 million effective December 31, 2016;


•	working capital not less than $18 million; and


•	debt service coverage ratio of not less than 1.25 to 1.00.