Financing Arrangements

12 Months Ended

Dec. 31, 2022

Debt consists of the following:


				Carrying Value at
	Maturity Date	Interest Rate at December 31, 2022		December 31, 2022		December 31, 2021

Senior Notes due 2027	April 15, 2027	6.625	%	$	350.0	$	350.0

Revolving credit facility	November 26, 2024	5.40	%	285.3		221.1


Finance leases	Various	Various		18.5		8.5
Other	Various	Various		15.3		17.5
Total debt				669.1		597.1
Less: Current portion of long-term debt and short-term debt				(10.9)		(6.3)

Less: Unamortized debt issuance costs				(3.1)		(3.9)
Total long-term debt, net				$	655.1	$	586.9

In addition to debt listed above, on December 30, 2022, the Company entered into the MOU with a third party pursuant to which the third party would purchase our Aluminum Products business. The sale of the Aluminum Products business is subject to the successful completion of a definitive purchase agreement and other customary conditions. In connection with the MOU, the Company also entered into a financing arrangement with the third party pursuant to which the Company received a portion of the estimated purchase price of the Aluminum Products business, including $20.0 million of cash and a promissory note in the principal amount of $25.0 million, and recorded a financing arrangement liability of $45.0 million. The Company used the $20.0 million from this financing arrangement to repay indebtedness under its revolving credit facility. If a definitive purchase agreement between the parties is not entered into or the sale is not successfully consummated, the promissory note will be cancelled and the Company will repay the third party $20.0 million, less a $0.8 million break-up fee.

Park-Ohio’s Seventh Amended and Restated Credit Agreement (as amended, the “Credit Agreement”) provides for a revolving credit facility in the amount of $405.0 million, including a $40.0 million Canadian revolving subcommitment and a European revolving subcommitment in the amount of $30.0 million. Pursuant to the Credit Agreement, the Company has the option to increase the availability under the revolving credit facility by an aggregate incremental amount up to $70.0 million. The Credit Agreement matures on November 16, 2024. As of December 31, 2022, we had borrowing availability of $102.3 million under the Credit Agreement.

In April 2017, Park-Ohio completed the issuance, in a private placement, of $350.0 million aggregate principal amount of 6.625% Senior Notes due 2027 (the “Notes”). Interest on the Notes is payable semi-annually in arrears on April 15 and October 15 of each year, and the Notes mature on April 15, 2027. The Notes are unsecured senior obligations of Park-Ohio and are guaranteed on an unsecured senior basis by the 100% owned material domestic subsidiaries of Park-Ohio.

On August 13, 2015, the Company entered into a finance lease agreement (the “Lease Agreement”). The Lease Agreement provides the Company up to $50.0 million for finance leases. Finance lease obligations of $5.1 million were borrowed under the Lease Agreement as of December 31, 2022 to acquire machinery and equipment. See Note 13 for additional disclosures about finance leases. As of December 31, 2022, the Company had additional finance leases totaling $13.4 million.

On October 21, 2015, the Company, through its subsidiary, Southwest Steel Processing LLC, entered into a financing agreement with the Arkansas Development Finance Authority. The agreement provides the Company the ability to borrow up to $11.0 million for expansion of its manufacturing facility in Arkansas. The loan matures in September 2025. The Company has borrowed $4.3 million under this agreement as of December 31, 2022.

The following table represents fair value information of the Notes, classified as Level 1, at December 31, 2022 and 2021. The fair value was estimated using quoted market prices.


	December 31, 2022		December 31, 2021

Carrying amount	$	350.0	$	350.0
Fair value	$	227.5	$	337.6

Maturities of short-term and long-term debt, excluding finance leases, during each of the five years subsequent to December 31, 2022 are as follows:



2023	$	6.6
2024	$	288.5
2025	$	3.0
2026	$	1.0
2027	$	350.4

Foreign subsidiaries of the Company had $10.9 million of borrowings at December 31, 2022 and $9.8 million at December 31, 2021.

We had outstanding bank guarantees and letters of credit under our credit arrangements of approximately $41.0 million at December 31, 2022 and $39.7 million at December 31, 2021.

The weighted average interest rate on all debt was approximately 5.1% in 2022, 4.8% in 2021 and 5.0% in 2020.