NOTES PAYABLE AND LONG-TERM DEBT

As of December 31, 2012 and 2011, the Company had short-term and long-term debt outstanding as follows:



	December 31,
(millions of dollars)	2012		2011
Short-term debt
Short-term borrowings	$	129.1	$	116.3
Receivables securitization	110.0		80.0
Total short-term debt	$	239.1	$	196.3

Long-term debt
3.50% Convertible senior notes due 04/15/12	$	—	$	368.5
5.75% Senior notes due 11/01/16 ($150 million par value)	149.6		149.5
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)	247.9		247.7
7.125% Senior notes due 02/15/29 ($121 million par value)	119.4		119.3
Multi-currency revolving credit facility	140.0		70.0
Term loan facilities and other	17.1		19.8
Unamortized portion of debt derivatives	20.2		24.1
Total long-term debt	$	828.1	$	1,132.8
Less: current portion	4.3		381.5
Long-term debt, net of current portion	$	823.8	$	751.3

The weighted average interest rate on all borrowings outstanding as of December 31, 2012 and 2011 was 4.0% and 5.9%, respectively.

Annual principal payments required as of December 31, 2012 are as follows :



(millions of dollars)
2013	$	243.4
2014	0.4
2015	12.4
2016	290.0
2017	—
After 2017	524.8
Total payments	$	1,071.0
Less: unamortized discounts	3.8
Total	$	1,067.2

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

The Company's $650 million multi-currency revolving credit facility, which includes a feature that allows the Company's borrowings to be increased to $1 billion, 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, 2012 and expects to remain compliant in future periods. At December 31, 2012 and 2011, the Company had outstanding borrowings of $140.0 million and $70.0 million, respectively, under this facility.

On April 9, 2009, the Company issued $373.8 million in convertible senior notes, which were settled in April 2012 by delivering approximately 11.4 million shares of common stock held in treasury to the note holders. The settlement resulted in a reduction in the current portion of long-term debt of $373.8 million, a reduction in common stock held in treasury of $617.3 million and a reduction in capital in excess of par value of $243.5 million. Prior to the settlement, the Company accreted the discounted carrying value of the convertible notes to their face value over the term of the notes.

The total interest expense related to the convertible senior notes in the Company’s Consolidated Statements of Operations for the years ended December 31, 2012, 2011 and 2010 was as follows:



	Year Ended December 31,
(millions of dollars)	2012		2011		2010
Interest expense	$	9.0	$	33.1	31.3
Non-cash portion	5.3		20.0		18.3

In conjunction with the convertible senior note offering, the Company entered into a bond hedge overlay, including both call options and warrants, at a net pre-tax cost of $25.2 million, effectively raising the conversion premium to 50%, or approximately $38.61 per share. On April 16, 2012, the Company settled the call option portion of the bond hedge overlay, receiving approximately 6.5 million shares of its common stock. The settlement resulted in an increase to common stock held in treasury of $503.9 million offset by an increase to capital in excess of par value of $503.9 million.

During the third and fourth quarters of 2012, the Company settled the warrants included in the bond hedge overlay, delivering approximately 4.9 million shares of its common stock held in treasury, resulting in a decrease to common stock held in treasury of $338.5 million offset by a decrease to capital in excess of par value of $338.5 million.

As of December 31, 2012 and 2011, the estimated fair values of the Company's senior unsecured notes totaled $770.3 million and $1,454.4 million, respectively. The estimated fair values were $119.5 million and $435.5 million higher than their carrying value at December 31, 2012 and 2011, respectively. Fair market values of the senior unsecured notes are developed using observable values for similar debt instruments, which are considered Level 2 inputs as defined by ASC Topic 820. The carrying value of the Company's multi-currency revolving credit facility is equal to its fair value. 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 $59.1 million and $58.5 million at December 31, 2012 and 2011, respectively. The letters of credit typically act as guarantees of payment to certain third parties in accordance with specified terms and conditions.