NOTES PAYABLE AND LONG-TERM DEBT

As of December 31, 2011 and 2010, the Company had short-term and long-term debt outstanding as follows:



	December 31,
(millions of dollars)	2011		2010
Short-term debt
Short-term borrowings	$	116.3	$	42.4
Receivables securitization	80.0		80.0
Total short-term debt	$	196.3	$	122.4

Long-term debt
3.50% Convertible senior notes due 04/15/12	$	368.5	$	348.5
5.75% Senior notes due 11/01/16 ($150 million par value)	149.5		149.4
8.00% Senior notes due 10/01/19 ($134 million par value)	133.9		133.9
4.625% Senior notes due 09/15/20 ($250 million par value)	247.7		247.5
7.125% Senior notes due 02/15/29 ($121 million par value)	119.3		119.3
Multi-currency revolving credit facility	70.0		—
Term loan facilities & other	19.8		31.6
Unamortized portion of debt derivatives	24.1		27.8
Total long-term debt	$	1,132.8	$	1,058.0
Less: current portion	381.5		6.1
Long-term debt, net of current portion	$	751.3	$	1,051.9

The weighted average interest rate on all borrowings outstanding as of December 31, 2011 and 2010 was 5.9% and 6.4%, respectively.

Annual principal payments required as of December 31, 2011 are as follows :



(millions of dollars)
2012	$	583.0
2013	76.5
2014	0.3
2015	—
2016	150.0
After 2016	528.7
Total payments	$	1,338.5
Less: convertible note accretion	(5.2		)
Less: unamortized discounts	(4.2		)
Total	$	1,329.1

The Company's long-term debt includes various financial covenants, none of which are expected to restrict future operations.

On June 30, 2011, the Company amended and extended its $550 million multi-currency revolving credit facility (which included a feature that allowed the Company's borrowings to be increased to $600 million) to a $650 million multi-currency revolving credit facility (which includes a feature that allows the Company's borrowings to be increased to $1 billion). The facility provides for borrowings through June 30, 2016 and is guaranteed by the Company's material domestic subsidiaries. The Company has two key financial covenants as part of the credit agreement. These covenants are a debt compared to EBITDA (“Earnings Before Interest, Taxes, Depreciation and Amortization”) test and an interest coverage test. The Company was in compliance with all covenants at December 31, 2011 and expects to remain compliant in future periods. At December 31, 2011, the Company had outstanding borrowings of $70 million under this facility. There were no outstanding borrowings under this facility at December 31, 2010.

On September 16, 2010, the Company issued $250 million in 4.625% senior notes due 2020. Interest is payable semi-annually on March 15 and September 15 of each year, beginning on March 15, 2011.

On April 9, 2009, the Company issued $373.8 million in convertible senior notes due April 15, 2012. Under ASC Topic 470, “Accounting for Convertible Debt Instruments That May be Settled in Cash Upon Conversion (Including Partial Cash Settlement)," the Company accounted for the convertible senior notes by bifurcating the instruments between its liability and equity components. The value of the debt component was based on the fair value of issuing a similar nonconvertible debt security. The value of the equity component was calculated by deducting the value of the liability from the proceeds received at issuance. The Company's December 31, 2011 Consolidated Balance Sheet includes current debt of $368.5 million due April 15, 2012 and capital in excess of par value of $36.5 million. Additionally, ASC Topic 470 requires the Company to accrete the discounted carrying value of the convertible notes to their face value over the term of the notes. The Company's interest expense associated with this amortization is based on the effective interest rate of the convertible senior notes of 9.365%. The total interest expense related to the convertible senior notes in the Company's Consolidated Statements of Operations for the years ended December 31, 2011 and 2010 was as follows:



	Year Ended December 31,
(millions of dollars)	2011		2010
Interest expense	$	33.1	$	31.3
Non-cash portion	20.0		18.3

The notes pay interest semi-annually of $6.5 million, which is at a coupon rate of 3.50% per year.

Holders of the notes may convert their notes at their option at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date of the notes, in multiples of $1,000 principal amount. The initial conversion rate for the notes is 30.4706 shares of the Company's common stock per $1,000 principal amount of notes (representing an initial conversion price of approximately $32.82 per share of common stock). The conversion price represents a conversion premium of 27.50% over the last reported sale price of the Company's common stock on the New York Stock Exchange on April 6, 2009 of $25.74 per share. Since the Company's stock price was above the convertible senior notes conversion price of $32.82, the if-converted value was approximately $352.1 million and $450.2 million higher than the face value of the convertible senior notes at December 31, 2011 and December 31, 2010, respectively. In conjunction with the note offering, the Company entered into a bond hedge overlay at a net pre-tax cost of $25.2 million, effectively raising the conversion premium to 50.0%, or approximately $38.61 per share. In accordance with the original terms of the agreement, the Company has an option to settle the convertible senior notes through delivering cash, shares of its common stock or a combination thereof. On December 13, 2011, the Company announced its intention to settle the convertible senior notes through delivering shares of its common stock, currently held in treasury stock.

As of December 31, 2011 and 2010, the estimated fair values of the Company's senior unsecured notes totaled $1,454.4 million and $1,482.3 million, respectively. The estimated fair values were $435.5 million and $483.7 million higher at December 31, 2011 and 2010, respectively, than their carrying values. Fair market values are developed by the use of estimates obtained from brokers and other appropriate valuation techniques based on information available as of quarter-end and year-end. The fair value estimates do not necessarily reflect the values the Company could realize in the current markets.

The Company had outstanding letters of credit of $50.0 million and $26.5 million at December 31, 2011 and 2010, respectively. The letters of credit typically act as guarantees of payment to certain third parties in accordance with specified terms and conditions.