SHORT-TERM AND LONG-TERM DEBT

Short-Term Debt. As of December 31, 2014, total short-term debt outstanding was $104.4 million ($27.2 million as of December 31, 2013) and consisted of long-term debt due within one year and notes payable.

As of December 31, 2014, we had bank lines of credit aggregating $408.4 million ($406.4 million as of December 31, 2013), the majority of which expire in November 2018. We had $47.5 million outstanding in standby letters of credit and $3.7 million outstanding in draws under our lines of credit as of December 31, 2014 ($5.4 million in standby letters of credit and no draws outstanding as of December 31, 2013).

Long-Term Debt. As of December 31, 2014, total long-term debt outstanding was $1,272.8 million ($1,083.0 million as of December 31, 2013). In conjunction with ALLETE Clean Energy’s January 30, 2014 wind energy facilities acquisition, ALLETE Clean Energy assumed $23.3 million of long-term debt, including $2.2 million due within one year. (See Note 7. Acquisitions.) The aggregate amount of long-term debt maturing in 2015 is $100.7 million ($24.9 million in 2016; $54.6 million in 2017; $54.8 million in 2018; $46.9 million in 2019; and $1,091.6 million thereafter). Substantially all of our regulated electric plant is subject to the lien of the mortgage collateralizing outstanding first mortgage bonds. The mortgages contain non-financial covenants customary in utility mortgages, including restrictions on our ability to incur liens, dispose of assets, and merge with other entities.

During 2014, we issued $375.0 million of ALLETE first mortgage bonds (Bonds) in the private placement market as shown below:



Issue Date	Maturity Date	Principal Amount	Interest Rate
March 4, 2014	March 15, 2024	$60 Million	3.69%
March 4, 2014	March 15, 2044	$40 Million	4.95%
June 26, 2014	July 15, 2022	$75 Million	3.40%
June 26, 2014	July 15, 2044	$40 Million	5.05%
September 16, 2014	September 15, 2021	$60 Million	3.02%
September 16, 2014	September 15, 2029	$50 Million	3.74%
September 16, 2014	September 15, 2044	$50 Million	4.39%

The Company has the option to prepay all or a portion of the Bonds at its discretion, subject to a make-whole provision; however, each series of bonds is redeemable at par, including, in each case, accrued and unpaid interest, six months prior to the maturity date. The Bonds are subject to additional terms and conditions which are customary for these types of transactions. The Company used the proceeds from the sale of the Bonds to refinance debt, fund utility capital expenditures and/or for general corporate purposes. The Bonds were sold in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended, to institutional accredited investors.

NOTE 11. SHORT-TERM AND LONG-TERM DEBT (Continued)



Long-Term Debt
As of December 31	2014		2013
Millions
First Mortgage Bonds
6.94% Series Due 2014	—		$18.0
7.70% Series Due 2016	$20.0		20.0
1.83% Series Due 2018	50.0		50.0
8.17% Series Due 2019	42.0		42.0
5.28% Series Due 2020	35.0		35.0
4.85% Series Due 2021	15.0		15.0
3.02% Series Due 2021	60.0		—
3.40% Series Due 2022	75.0		—
4.95% Pollution Control Series F Due 2022	—		111.0
6.02% Series Due 2023	75.0		75.0
3.69% Series Due 2024	60.0		—
4.90% Series Due 2025	30.0		30.0
5.10% Series Due 2025	30.0		30.0
3.20% Series Due 2026	75.0		75.0
5.99% Series Due 2027	60.0		60.0
3.30% Series Due 2028	40.0		40.0
3.74% Series Due 2029	50.0		—
5.69% Series Due 2036	50.0		50.0
6.00% Series Due 2040	35.0		35.0
5.82% Series Due 2040	45.0		45.0
4.08% Series Due 2042	85.0		85.0
4.21% Series Due 2043	60.0		60.0
4.95% Series Due 2044	40.0		—
5.05% Series Due 2044	40.0		—
4.39% Series Due 2044	50.0		—
Unsecured Term Loan Variable Rate Due 2015	75.0		75.0
Senior Unsecured Notes 5.99% Due 2017	50.0		50.0
Variable Demand Revenue Refunding Bonds Series 1997 A Due 2015 – 2020	24.6		24.6
Industrial Development Variable Rate Demand Refunding Revenue Bonds Series 2006, Due 2025	27.8		27.8
SWL&P First Mortgage Bonds 4.15% Series Due 2028	15.0		15.0
Other Long-Term Debt, 0.08% – 7.50% Due 2015 – 2037	59.1		41.8
Total Long-Term Debt	1,373.5		1,110.2
Less: Due Within One Year	100.7		27.2
Net Long-Term Debt		$1,272.8		$1,083.0

Financial Covenants. Our long-term debt arrangements contain customary covenants. In addition, our lines of credit and letters of credit supporting certain long-term debt arrangements contain financial covenants. Our compliance with financial covenants is not dependent on debt ratings. The most restrictive covenant requires ALLETE to maintain a ratio of indebtedness to total capitalization (as the amounts are calculated in accordance with the respective long-term debt arrangements) of less than or equal to 0.65 to 1.00, measured quarterly. As of December 31, 2014, our ratio was approximately 0.47 to 1.00. Failure to meet this covenant would give rise to an event of default if not cured after notice from the lender, in which event ALLETE may need to pursue alternative sources of funding. Some of ALLETE’s debt arrangements contain “cross-default” provisions that would result in an event of default if there is a failure under other financing arrangements to meet payment terms or to observe other covenants that would result in an acceleration of payments due. As of December 31, 2014, ALLETE was in compliance with its financial covenants.