Debt

Our debt consists of the following:



	December 31,
(in millions)	2014					2013
				Weighted Avg. Int. Rate					Weighted Avg. Int. Rate
Short-term borrowings
Lines of credit	$	21.3				$	33.9
Revolving credit facility	0.3					8.0
Capital lease obligations	0.5					—
Other debt	0.6					0.4
Current maturities of long-term debt	6.7					7.4
Total short-term borrowings	$	29.4		11.3	%	$	49.7		8.7	%
Long-term borrowings
Lines of credit	$	16.5				$	7.1
Term Loan	8.3					15.0
Capital lease obligations	0.6					1.8
Other debt	1.1					1.0
Less: Current maturities of long-term debt	(6.7		)			(7.4		)
Total long-term debt borrowings	$	19.8		4.9	%	$	17.5		4.4	%

We have a Revolving Credit and Security Agreement with PNC Bank, National Association (“PNC”). Subject to the terms and conditions of the agreement as amended, PNC agreed to provide senior secured revolving credit financing up to an aggregate principal amount of $34.0 million, which includes up to $10.0 million in letters of credit subject to a borrowing base formula, lender reserves and PNC’s reasonable discretion. With the 2013 amendment, PNC also provided a senior secured term loan up to an aggregate principal amount of $15.0 million. The loans under the facilities bear interest at either LIBOR or an alternative base rate, plus a margin that varies with borrowing availability under the revolving credit facility. The maturity of these facilities has been extended to December 11, 2018.

During the first quarter of 2014, we entered into an amendment to our Revolving Credit and Security Agreement with PNC, pursuant to which all closing conditions which existed at the end of 2013 related to the 2013 amendment were deemed met and we agreed to use a portion of those proceeds to prepay the Term Loan because of a shortfall in the margin value of the collateral. As a result, we reclassified the remaining proceeds from "Restricted cash and cash equivalents" to "Cash and cash equivalents" on our Consolidated Balance Sheets.

We paid $0.4 million in fees associated with the amendments. We had a remaining balance of $0.1 million in fees associated with the original agreement in 2011, which were capitalized and will now be amortized over the new five year term of the amended agreement. We must also pay a facility fee of 0.375% a year on the unused portion of the facility. The facility is guaranteed by Tecumseh Products Company and its U.S. and Canadian subsidiaries and is secured by substantially all of the assets of the borrowers.

The PNC agreement contains various covenants, including limitations on dividends, investments and additional indebtedness and liens, and a minimum fixed charge coverage ratio, which would apply only if average undrawn borrowing availability, as defined by the credit agreement, were to fall below a specified level for more than five business days. We had $0.4 million of additional borrowing capacity under this facility as of December 31, 2014, after giving effect to our fixed charge coverage ratio covenant and our outstanding borrowings and letters of credit under this facility. We were in compliance with all covenants and terms of the agreement at December 31, 2014.

At December 31, 2014, our borrowings under the PNC revolving facility totaled $0.3 million and borrowings under the PNC term loan were $8.3 million. In addition, we had $6.4 million in outstanding letters of credit.

In April 2013, we signed a loan agreement with the Mississippi Development Authority ("MDA") for draws up to $1.5 million at an interest rate of 2.25% and with a maturity date of February 2021. Draws under the agreement are permitted for purchases of certain equipment at our Tupelo, Mississippi location. We received the final draw in the second quarter of 2014. Fixed principal and interest payments started on the loan in the first quarter of 2014 and as of December 31, 2014 we had an outstanding balance of $1.3 million.

In the U.S., we have $0.3 million outstanding in short term borrowings related to financing some of our insurance premiums and $0.4 million outstanding in long term borrowings related to software financing.

We have various borrowing arrangements at our foreign subsidiaries to support working capital needs and government sponsored borrowings which provide advantageous lending rates.

In Brazil, as of December 31, 2014, we have uncommitted, discretionary line of credit facilities with several local private Brazilian banks (some of which are sponsored by the Brazilian government) for an aggregate maximum of $37.6 million, subject to a borrowing base formula computed on a monthly basis. These credit facilities are secured by a portion of our accounts receivable and inventory balances and expire at various times from January 16, 2015 through July 15, 2023. Since the expiration of the January 16, 2015 credit facility, Brazil has already acquired new credit facilities in 2015. Historically we have been able to enter into replacement facilities when these facilities expire, but such replacements are at the discretion of the banks. Lenders determine, at their discretion, whether to make new advances with respect to each draw on such facilities. There are no restrictive covenants on these credit facilities. In the second quarter of 2014, our Brazilian location was approved for a special term low interest rate loan from a governmental agency: FINEP. This agency provides funding to companies to further innovation and research and development spending in Brazil. Our Brazilian location was approved for a loan in the amount of up to approximately 82.5 million Brazilian Reals to be used on approved research and development projects, provided that our Brazilian location spends up to approximately 35.3 million Reals of its own resources on the financed projects. This loan has a grace period of 36 months, after which it will be repaid on a monthly basis between July 2017 and July 2023. We paid $0.1 million in fees associated with this loan. We received the first installment of the loan in the amount equivalent to $11.0 million during the third quarter of 2014; however, $0.5 million of this amount represents restricted funds for projects not yet commenced. We also placed collateral in the amount of $5.1 million for this loan in a separate bank account. Both the collateral and the restricted funds are recorded as "Restricted cash and cash equivalents" on our Consolidated Balance Sheets. Our borrowings in Brazil at December 31, 2014 totaled $28.8 million, with an additional $19.8 million available for borrowing, based on our accounts receivable, inventory levels and current FINEP financing at that date. In addition, we expect to receive the remaining amount of the FINEP loan in two equal installments during the next two years.

In India, we have an aggregate maximum availability of $12.4 million in line of credit facilities which are secured by land, buildings and equipment, inventories and receivables and are subject to a borrowing base formula computed on a monthly basis. The arrangements expire at various times from February 2015 through March 2015. The acquisition of new credit facilities to replace expired facilities is currently underway. Historically, we have been able to renew these facilities when they expire; however, such renewal is at the discretion of the banks. Our borrowings under these facilities totaled $8.5 million, and based on our borrowing base as of December 31, 2014, we had $3.9 million available for borrowing under these facilities. There are no restrictive covenants on these credit facilities, except that consent must be received from the bank in order to dispose of certain assets located in India.

We also have capital lease agreements with an outstanding balance of $1.1 million which are included in our total borrowings balance at December 31, 2014.

Our consolidated borrowings totaled $49.2 million at December 31, 2014 and $67.2 million at December 31, 2013. Our weighted average interest rate for these borrowings was 9.0% for the twelve months ended December 31, 2014 and 8.1% for the twelve months ended December 31, 2013.

Scheduled maturities of debt and capital lease obligations for each of the five years subsequent to December 31, 2014 are as follows:



(in millions)
2015	$	29.4
2016	$	4.3
2017	$	4.2
2018	$	0.2
2019	$	0.2
Thereafter	$	10.9
Total	$	49.2