ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

See accompanying Notes to Condensed Consolidated Financial Statements.

(1) See Note 23 - Restatement of Condensed Consolidated Financial Statements

See accompanying Notes to Condensed Consolidated Financial Statements.

(1) See Note 23 - Restatement of Condensed Consolidated Financial Statements

See accompanying Notes to Condensed Consolidated Financial Statements.

(1) See Note 23 - Restatement of Condensed Consolidated Financial Statements

GENERAL CABLE CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (unaudited)

The accompanying unaudited condensed consolidated financial statements of General Cable Corporation and Subsidiaries (“General Cable” or the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Results of operations for the nine fiscal months ended September 27, 2013 are not necessarily indicative of results that may be expected for the full year. The December 31, 2012 condensed consolidated balance sheet amounts are derived from the audited financial statements. These financial statements should be read in conjunction with the audited financial statements and notes thereto in General Cable’s 2012 Amended Annual Report on Form 10-K/A filed with the Securities and Exchange Commission on January 21, 2014 . The Company’s fiscal quarters consist of 13-week periods ending on the Friday nearest to the end of the calendar months of March, June and September.

The condensed consolidated financial statements include the accounts of General Cable Corporation and its wholly-owned subsidiaries. Investments in 50% or less owned joint ventures in which the Company has the ability to exercise significant influence are accounted for under the equity method of accounting. All intercompany transactions and balances among the consolidated companies have been eliminated.

The Company’s significant accounting policies are described in Note 2 to the audited annual consolidated financial statements in the Amended Annual 2012 Form 10-K/A. In the nine months ended September 27, 2013 , there have been no significant changes to these policies. In the nine months ended September 27, 2013 , there have been no accounting pronouncements issued that are expected to have a significant effect on the condensed consolidated financial statements. The following accounting pronouncements were adopted and became effective with respect to the Company in 2013 and 2012:

In February 2013, the FASB issued Accounting Standards Update No. 2013-02 (“ASU 2013-02”), “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income,” which amends ASC 220, “Comprehensive Income.” The amended guidance requires an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under U.S. GAAP to be reclassified in its entirety to net income. For other amounts that are not required under U.S GAAP to be reclassified in their entirety from accumulated other comprehensive income to net income in the same reporting period, an entity is required to cross-reference other disclosures required under GAAP that provide additional detail about those amounts. ASU 2013-02 is effective for interim and annual periods beginning after December 15, 2012. The Company has adopted the provisions of ASU 2013-02 as required.

In December 2011, the FASB issued ASU No. 2011-11 ("ASU 2011-11), "Disclosures about Offsetting Assets and Liabilities." The amendments in this update require enhanced disclosures around financial instruments and derivative instruments that are either (1) offset in accordance with either ASC 210-20-45 or ASC 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with either ASC 210-20-45 or ASC 815-10-45. The amendments are effective during interim and annual periods beginning on or after January 1, 2013. The Company has adopted the disclosure requirements of ASU 2011-11 as of January 1, 2013 and has included the disclosures required by those amendments retrospectively for all comparative periods presented in Note 10 - Financial Instruments of this quarterly report on Form 10-Q.

Alcan Cable North America

On September 4, 2012 , the Company completed the acquisition of the North American business of Alcan Cable North America for $151.0 million , subject to additional customary adjustments of $20.3 million as anticipated in the purchase agreement, primarily related to estimated working capital levels at closing. The Company paid $171.3 million in cash to the sellers at closing in consideration for the North American business and expensed $3.3 million in fees and expenses related to the acquisition in the second half of 2012, reported within selling, general and administrative expenses ("SG&A").

Alcan Cable North America employs over 750 employees in North America and is a leading supplier of aluminum strip products and a leading supplier of both electrical and mechanical rod alloys around the globe. The acquisition is expected to create synergies, expand the range of product offerings, increase production capacity and complement the Company's current investments. In 2011, the last full year before the acquisition, Alcan Cable North America reported net sales of approximately $610 million . Alcan Cable North America's sales and financial results are consolidated in the North America operating segment.

The following table represents a purchase price allocation based on the estimated fair values, or other measurements as applicable, of the assets acquired and the liabilities assumed, in millions:

(1) Accounts receivable represents gross contractual value. As of the acquisition date, the fair value of accounts receivable approximated carrying value.

The primary factors that contributed to the acquisition price in excess of the fair value of net assets acquired and the establishment of goodwill was the expansion of product lines and production capacity in the United States and Canada as well as the strategic benefit of adding additional presence in the Mexican market. The resulting goodwill is amortizable for tax purposes.

The amount of net sales included in the Company's actual consolidated results of operations from the acquisition of Alcan Cable North America were $ 117.9 million and $ 362.6 million , respectively, for the three and nine months ended September 27, 2013 . The amount of operating income included in the Company's actual consolidated results of operations from the acquisition of Alcan Cable North America were $ 7.1 million and $ 31.3 million , respectively, for the three and nine months ended September 27, 2013 . The amount of net sales and net operating income (loss) included in the Company's actual consolidated results of operations from the acquisition of Alcan Cable North America were $ 47.6 million and $ 0.1 million for the three and nine months ended September 28, 2012 .

Productora de Cables Procables S.A.S. (“Procables”)

On October 1, 2012, the Company acquired 60% of Procables from the existing shareholders (the “Seller” or “Minority Shareholder”), who maintained control of the remaining 40% of the shares, for $ 27.4 million which was retained by the Company of which $ 24.0 million was used to pay down the assumed existing debt of $ 48.1 million . For a 36 -month period commencing on the expiration of the no-transfer period of four years, the Minority Shareholder may exercise a put option to sell all of their shares, 40% of the shares, to the Company. The Company shall be irrevocably obligated to purchase the shares ("Put Option"). In addition, the Company has a call option ("Call Option") to purchase the additional 40% of the shares. For a 36 -month period commencing on the expiration of the no-transfer period of four years, the Company may exercise a Call Option right to purchase all of the Sellers' shares (the remaining 40% ). The consideration to be exchanged, per share in the event of a Put Option or Call Option shall be the higher of the following (1) the final per share purchase price; or (2) a price per share based on the Company's enterprise value equal to seven times the average of its earnings before interest, taxes, depreciation and amortization (“EBITDA”) over the two most recently audited year-end financial statements immediately prior to the option being exercised, minus the 12-month average net indebtedness of the Company for the most recent audited fiscal year (“EBITDA average”). The Company expensed $0.6 million in fees and expenses related to the acquisition, reported within SG&A in the fourth quarter of 2012.

Procables employs over 500 employees, through its two manufacturing facilities in Bogota and Barranquilla in ROW, and offers a broad range of wire and cable products, including low and medium voltage power cables, building wire, industrial, communications, and bare aluminum conductors as well as operating copper and aluminum rod mills. The acquisition of Procables is expected to enhance the Company's presence in the Andean Region, create synergies, increase production capacity and complement the Company's current investments in ROW. In 2011, the last full year before the acquisition, Procables reported

revenues of $120 million . Procables' sales and financial results are consolidated in the ROW operating segment.The following table represents a purchase price allocation based on the estimated fair values, or other measurements as applicable, of the assets acquired and the liabilities assumed, in millions:

(1) Accounts receivable is gross contractual value. As of the acquisition date, the fair value of accounts receivable approximated carrying value.

The primary factor which contributed to an acquisition price in excess of the fair value of net assets acquired and the establishment of goodwill was the strategy to enhance the Company's presence in this strategically important market in the Andean Region further solidifying the Company's geographic coverage throughout the Americas which is one of the most extensive in the wire and cable industry. The resulting goodwill is not amortizable for tax purposes.

The amount of net sales included in the Company's actual consolidated results of operations from the acquisition of Procables were $ 34.1 million and $ 104.6 million for the three and nine months ended September 27, 2013 . The amount of net operating income (loss) included in the Company's actual consolidated results of operations from the acquisition of Procables was $ 1.1 million for the three and nine months ended September 27, 2013 .

Prestolite Wire, LLC ("Prestolite")

On November 2, 2012, the Company acquired Prestolite for $ 59.5 million . The operations include two manufacturing locations in Paragould, Arkansas and Nogales, Mexico. The Company expensed $ 0.6 million in fees and expenses related to the acquisition, reported within SG&A in the fourth quarter of 2012.

Through its manufacturing facilities in the United States and Mexico, Prestolite offers a broad range of wire and cable and wire harness products serving predominately transportation OEMs, tier 1 wire harness manufacturers and distribution customers. Prestolite employs over 700 employees. In 2011, the last full year before the acquisition, Prestolite reported revenues of $170 million . Prestolite's sales and financial results are consolidated in the North American operating segment.

The following table represents a purchase price allocation based on the estimated fair values, or other measurements as applicable, of the assets acquired and the liabilities assumed, in millions:

(1) Accounts receivable is gross contractual value. As of the acquisition date, the fair value of accounts receivable approximated carrying value.

The primary factors that contributed to the acquisition price in excess of the fair value of net assets acquired and the establishment of goodwill were the Company's ability to strategically grow its business with existing customers to capitalize on greater opportunities to offer existing products to new markets, and strengthening of its market strategies for both new and existing specialty industrial OEM and distribution customers. A portion of the goodwill is amortizable for tax purposes.

The amount of net sales included in the Company's actual consolidated results of operations from the acquisition of Prestolite were $ 48.8 million and $ 153.8 million for the three and nine months ended September 27, 2013 . The amount of operating income included in the Company's actual consolidated results of operations from the acquisition of Prestolite was $ 1.2 million and $ 5.0 million for the three and nine months ended September 27, 2013 .

Alcan Cable China

On December 3, 2012, the Company completed the acquisition of the Chinese business of Alcan Cable ("Alcan Cable China"), a related business of Alcan Cable North America, for $ 57.7 million . The Company expensed $ 1.1 million in fees and expenses related to the acquisition, reported within SG&A in the fourth quarter of 2012. The final purchase price is subject to further customary adjustments primarily related to working capital levels.

Alcan Cable China employs over 300 employees in China and is expected to create synergies, expand the range of product offerings, increase production capacity and complement the Company's current investment in China. In 2011, the last full year before the acquisition, Alcan Cable China reported net sales of approximately $65 million . Alcan Cable China's sales and financial results are consolidated in the ROW operating segment.

The following table represents a purchase price allocation based on the estimated fair values, or other measurements as applicable, of the assets acquired and the liabilities assumed, in millions:

(1) Accounts receivable is gross contractual value. As of the acquisition date, the fair value of accounts receivable approximated carrying value.

The amount of net sales included in the Company's actual consolidated results of operations from the acquisition of Alcan Cable China were $ 29.4 million and $ 74.8 million for the three and nine months ended September 27, 2013 . The amount of net operating

income included in the Company's actual consolidated results of operations from the acquisition of Alcan Cable China was $ 3.7 million and $ 7.4 million for the three and nine months ended September 27, 2013 .

The following table presents selected financial information, in millions, except per share data, from the actual condensed consolidated results of operations for the Company for the three and nine months ended September 28, 2012 and presents selected financial information from unaudited pro forma condensed consolidated results of operations for the Company for the three and nine months ended September 28, 2012 , respectively, as though the aforementioned acquisitions had been completed as of the beginning of that period. This pro forma information is intended to provide information regarding how the Company might have looked if the acquisitions had occurred as of January 1, 2012 . The pro forma adjustments represent management's best estimates based on information available at the time the pro forma information was prepared and may differ from the adjustments that may actually have been required. Accordingly, the pro forma financial information should not be relied upon as being indicative of the historical results that would have been realized had the acquisitions occurred as of the date indicated or that may be achieved in the future.

The unaudited pro forma results are based on historical results of operations, adjusted for the allocation of purchase price and other acquisition accounting adjustments, and are not necessarily indicative of either future results of operations or results that might have been achieved had the acquisitions been completed as of January 1, 2012 . The unaudited pro forma financial information does not reflect any (i) integration costs that may be incurred as a result of the acquisitions; (ii) synergies, operating efficiencies and costs savings that may result from the acquisitions; or (iii) changes in commodities prices subsequent to the dates of such unaudited pro forma financial information. In addition, the unaudited pro forma financial information does not include any transition costs, restructuring costs or recognition of compensation expenses or other one-time charges that may be incurred in connection with integrating the operations of the Company and the acquired companies.

The Company completed an acquisition in Brazil in the second quarter of 2012. The results of operations of the acquired business have been included in the condensed consolidated financial statements since the date of acquisition, and have been determined to be immaterial for disclosure purposes.

Other income (expense) includes foreign currency transaction gains or losses, which result from changes in exchange rates between the designated functional currency and the currency in which a transaction is denominated as well as gains and losses on derivative instruments that are not designated as cash flow hedges and ineffectiveness on derivatives designated as cash flow hedges. During the three months ended September 27, 2013 and September 28, 2012 , the Company recorded other income of $ 9.5 million and other income of $ 9.3 million , respectively. During the nine months ended September 27, 2013 and September 28, 2012 , the Company recorded other expense of $ 58.8 million and other income of $ 2.6 million , respectively. For the three months ended September 27, 2013 , other income was primarily attributable to $ 2.9 million related to gains on derivative instruments that were not designated as cash flow hedges and other income of $ 6.6 million related to foreign currency transactions which included $ 4.3 million in foreign exchange gains related to copper imports in Venezuela that were approved at the 4.30 BsF per U.S. dollar rate prior to February 13, 2013 and paid in the second quarter of 2013. For the three months ended September 28, 2012 , other income was primarily the result of $ 8.4 million related to gains on derivative instruments which were not designated as cash flow hedges and other income of $ 0.9 million related to foreign currency transactions. For the nine months ended September 27, 2013 , other expense was primarily attributable to $ 40.9 million related to the Venezuela currency devaluation, $17.5 million related to loses on derivative instruments that were not designated as cash flow hedges and other expense of $1.4 million related to foreign currency transaction losses which include $ 16.0 million in foreign exchange gains related to copper imports in Venezuela that were approved at the 4.30 BsF per U.S. dollar rate prior to currency devaluation on February 13, 2013. For the nine months ended September 28, 2012 , other income was primarily the result of $ 6.8 million related to gains on derivative instruments which were not designated as cash flow hedges and other expense of $4.2 million related to foreign currency transactions.

On February 13, 2013 the Venezuelan government announced the devaluation of its currency from 4.30 BsF per U.S. dollar to 6.30 BsF per U.S. dollar. Due to the impact of the devaluation of its currency by the Venezuelan government, the Company recorded

a pre-tax charge of $ 40.9 million in the nine months ended September 27, 2013 primarily related to the remeasurement of the local balance sheet on the date of the devaluation at the 6.30 BsF per U.S. dollar rate. The functional currency of the Company’s subsidiary in Venezuela is the U.S. dollar.

Approximately 83% of the Company’s inventories are valued using the average cost method and all remaining inventories are valued using the first-in, first-out (FIFO) method. All inventories are stated at the lower of cost or market value.  

Property, plant and equipment are stated at cost less accumulated depreciation. Costs assigned to property, plant and equipment related to acquisitions are based on estimated fair values on the acquisition date. Depreciation is recorded using the straight-line method over the estimated useful lives of the assets: buildings, from 15 to 50 years, and machinery, equipment and office furnishings, from 2 to 20 years. Leasehold improvements are depreciated over the shorter of the lease term or the useful life of the asset, unless acquired in a business combination, in which case the leasehold improvements are amortized over the shorter of the useful life of the asset or a term that includes the reasonably assured life of the lease.

Property, plant and equipment consisted of the following (in millions):  

Depreciation expense for the three and nine fiscal months ended September 27, 2013 was $ 30.3 million and $ 89.6 million , respectively. Depreciation expense for the three and nine fiscal months ended September 28, 2012 was $ 24.6 million and $ 72.4 million , respectively.

The Company periodically evaluates the recoverability of the carrying amount of long-lived assets (including property, plant and equipment and intangible assets with determinable lives) whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. The Company evaluates events or changes in circumstances based mostly on actual historical operating results, but business plans, forecasts, general and industry trends, and anticipated cash flows are also considered. Impairment is assessed when the undiscounted expected future cash flows derived from an asset are less than its carrying amount. Impairment losses are measured as the amount by which the carrying value of an asset exceeds its fair value and are recognized in earnings. The Company also continually evaluates the estimated useful lives of all long-lived assets and, when warranted, revises such estimates based on current events.

In the three months ended September 27, 2013 the Company’s executive management decided to no longer import building wire product into the United States from its General Cable Mexico unit (Mexico). This change is considered significant to the operation due to associated revenue, profit and the influence on the overall results of Mexico from this United States business. Based on the decision to no longer import building wire product from Mexico to the United States coupled with the pricing pressures in the Mexico market and the commercial challenges of entering into new businesses to support the new product lines

the Company performed an asset impairment review for its Mexican business in accordance with ASC 360 “Property, Plant and Equipment”.

The Mexico results are reported within the ROW reporting unit. The Mexico operations and assets include machinery and equipment which manufacture different products including power cables, building wire, telephone cables all housed in three manufacturing buildings. The three lines have a significant amount of shared costs including advertising, sales force, data processing, accounting, and management. The Company manages its business at a total Mexico level and has similar distribution methods. Therefore, based on the reporting structure the lowest level of which identifiable cash flows that can be determined is the Mexico unit.

The Company developed its internal forward business plans and 2014 outlook under the guidance of new local and regional leadership to determine the undiscounted expected future cash flows derived from the Mexican long lived assets. Based on the internal projections developed by executive management, the Company determined that the undiscounted expected future cash flows were less than the carrying value of the assets. Since the undiscounted expected cash flows was less than the carrying value of the assets the Company engaged a third party valuation firm to determine the amount of the impairment by determining the fair value of the Mexican long lived assets.  To determine the fair value of these assets, the Company first estimated the future cash flows associated with the Mexican business based on management's best estimates considering the likelihood of various outcomes.  Subsequently, the Company performed a current appraisal of the Mexican machinery and equipment and real property assets utilizing standard valuation approaches.  Based on the results of the analysis, the Company recorded an impairment charge of $14.0 million in the three months ended September 27, 2013. 

Goodwill and intangible assets with indefinite useful lives are not amortized, but are reviewed at least annually for impairment. The Company completes its annual impairment test within the fourth quarter of each year. In addition, the Company evaluates the carrying value between the valuations if events occur or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying amount. Events or circumstances may include, but are not limited to, a significant change in legal factors or in the business climate, adverse action or assessment by a regulator, unanticipated competition, loss of key personnel, possible sale or disposal of a reporting unit or a significant portion of a reporting unit, significant changes in financial projections or significant changes in the market capitalization. In September 2013, the Company began the review of the 2014 plan projections for the PDIC reporting unit. Based on preliminary results the Company noted the projected results for the 2013 forecast and the 2014 plan were significantly below the projections used for the 2012 impairment process, perhaps indicating a change in the business climate. Therefore, the Company decided to complete the 2013 goodwill and indefinite-lived intangible assets impairment analysis as of September 27, 2013 due to this impairment indicator for the PDIC reporting unit.

During the evaluation of impairment, the Company compares the fair value of the reporting unit to its carrying amount to determine if there is potential goodwill impairment. Our impairment testing for goodwill and indefinite-lived intangibles is performed separately. If the fair value of a reporting unit is less than its carrying value, an impairment loss is recorded to the extent that the fair value of the goodwill within the reporting unit is less than the carrying value of the goodwill. The impairment test for the Company’s indefinite-lived intangible assets involves comparing the fair value of the intangibles to their carrying values. If the carrying amount of an intangible asset with an indefinite life exceeds its fair value, an impairment loss would be recognized in the amount equal to the excess. If this fair value is less than the reporting unit's carrying value, a second step is required to measure the amount of impairment, if any. If the fair value of a reporting unit exceeds its carrying value, the second step is not required. The Company's market capitalization is a consideration during the annual impairment test.   The reporting unit comprising the goodwill is only a portion of the entire company.  The company must apply assumptions to compare the Company's market capitalization to the reporting unit being assessed.  First, a portion of the market capitalization is allocated  to the reporting unit.  This value is then increased by a control premium. To develop the control premium assumption, management considered other recent transactions within the industry and the control premium realized in those transactions.

The Company performed the first step of the goodwill impairment assessment. In Step 1 of the goodwill impairment test, the Company compared the fair value of the reporting unit, the entities purchased in the October 31, 2007 PDIC acquisition, to its carrying amount, including goodwill of $165.1 million. Based on the results of the valuation, the fair value of the reporting unit exceeded the carrying value; therefore, it was determined that no impairment existed. Step 2 was not required.

To determine the fair value of the reporting unit, the Company employs an income and market-based approach with each being weighted equally. Under the income approach, the Company uses a discounted cash flow method to calculate the fair value based on the present value of estimated future cash flows. Assumptions used in the discounted cash flow method, such as forecasted operating results, expected growth rates, working capital needs, tax rates, and cost of capital, are based on the current market conditions and are consistent with internal management projections. The cost of capital rate selected is based on consideration of the risks inherent in the investment and market rates of return available from alternative investments of similar type and quality

as of the valuation date. The guideline public company method is used for the market approach. The approach provides an estimate of value using multiples of earnings derived from the market values of publicly traded companies in the cable and wire industry. In addition to the selection of guideline companies, the market approach includes an analysis of the Company’s financial and operating performance, risk, profitability, and growth as compared to the reporting unit.

Our interim impairment test for both goodwill and indefinite lived intangibles assets indicated there was no impairment. While the Company believes that the assumptions and estimates utilized in the testing are appropriate, multiples of earnings, future changes in judgments, assumptions and estimates that are used in our annual impairment testing, including discount and tax rates, future cash flow projections, or the Company’s stock price, could result in significantly different estimates of fair value. For the 2013 impairment analysis, the Company used a discount rate of 11.5% and a residual growth rate of 4.6% . The discount rate used in the prior year was 12% . The decrease was due to lower relevered betas expected for comparable business or economic fundamentals impacting the reporting unit compared to the prior year. The residual growth rate decreased compared with the rate utilized in the 2012 impairment analysis due to lower expected long-term GDP growth for countries in which the reporting unit operates. As noted, changes in these estimates and assumptions could materially affect the results of Step 1 of the goodwill impairment tests. For example, an increase in the discount rate of 100 basis points or a decrease in the residual growth rate of 110 basis points would result in a decrease to the fair value of $62 million and $27 million , respectively. The fair value would still exceed the carrying value if these changes were made when employing an income and market-based approach. Overall, a decrease of 5% in the estimated fair value of any of the Company’s reporting units would not result in an impairment.

The Company performed the first step of the indefinite-lived intangible assets impairment test. In Step 1 of the impairment test, the Company determined the fair value of the indefinite-lived intangible assets exceeded their carrying value; therefore, it was determined that no impairment existed. Step 2 was not required.

Intangible assets that are not deemed to have indefinite lives are amortized over their useful lives.

The amounts of goodwill and indefinite-lived intangible assets were as follows in millions of dollars:

The amounts of other intangible assets were as follows in millions of dollars:

Amortized intangible assets are stated at cost less accumulated amortization as of September 27, 2013 and December 31, 2012 . Other intangible assets have been determined to have a useful life in the range of 7 to 12 years. The approximate weighted average useful life of the amortized intangible assets is 10 years. For customer relationships, the Company has accelerated the amortization expense to align with the historical customer attrition rates. In addition, the Company's other intangible assets include favorable lease contracts; the Company will recognize the expense over the life of the ten year lease on a straight line basis. The amortization of intangible assets for the first nine fiscal months of 2013 and 2012 was $ 9.3 million and $ 8.2 million , respectively. The estimated amortization expense during the twelve month periods beginning September 27, 2013 through September 28, 2018 and thereafter, based on exchange rates as of September 27, 2013 , is $ 12.0 million , $ 11.1 million , $ 10.1 million , $ 8.6 million , $ 3.9 million and $ 10.7 million thereafter.

Included within accrued liabilities were accruals related to restructuring and warranty expenses as of September 27, 2013 and December 31, 2012 .

Restructuring Accrual

The Company has incurred expenses as a result of cost reduction efforts in recent years. The expenses primarily relate to employee termination benefits that are payable under local statutory requirements. In the three and nine months ended September 27, 2013 the Company incurred $ 0.8 million and $ 6.8 million in charges related to actions taken at various operations in Europe to permanently reduce manufacturing personnel as well as severance expenses resulting from the recent North America acquisitions and the closure of a North American manufacturing facility. Payments made in nine months ended September 27, 2013 were $ 3.3 million resulting in an accrual balance related to these actions of $ 3.9 million at September 27, 2013 . The accrual balance related to these actions was immaterial at December 31, 2012 . Other expenses related to routine employee reductions for cost savings initiatives throughout the globe, with the exception of the aforementioned severance plan, were immaterial.

Warranty Accrual

The warranty accrual balance at September 27, 2013 and December 31, 2012 was $ 11.8 million and $ 12.8 million , respectively. The Company accrues liabilities under service and warranty policies based upon specific claims and a review of historical warranty and service claims experience. Adjustments are made to the accruals as claims data and historical experience change. In addition, the Company incurs discretionary costs to service its products in connection with product performance issues.

Changes in the carrying amount of the service and product warranty accrual are below (in millions):

At September 27, 2013 , maturities of long-term debt during the twelve month periods beginning September 27, 2013 through September 28, 2018 and thereafter are $ 585.3 million , $ 149.5 million , $ 2.1 million , $ 1.0 million and $ 11.8 million , respectively, and $ 778.9 million thereafter. As of September 27, 2013 and December 31, 2012 , the Company was in compliance with all material debt covenants as discussed below.

The fair value of the Company's long-term debt, as noted below, was estimated using quoted market prices where available. For long-term debt not actively traded, fair values were based on valuations from third-party banks and market quotations for similar types of borrowing arrangements.  

5.75% Senior Notes due 2022

On September 25, 2012 , the Company completed the issuance and sale of $ 600.0 million in aggregate principal amount of new senior unsecured notes due 2022 (the " 5.75% Senior Notes"). The 5.75% Senior Notes are jointly and severally guaranteed by each of the Company's current and future U.S. subsidiaries that is a borrower or a guarantor under the Company's Revolving Credit Facility or certain of the Company's or the guarantors' other indebtedness. The 5.75% Senior Notes were offered and sold in private transactions in accordance with Rule 144A and Regulation S under the Securities Act of 1933, as amended (the “Securities Act”). The 5.75% Senior Notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act. 

The Company's 5.75% Senior Notes are summarized in the table below:

The 5.75% Senior Notes' indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to (i) incur additional indebtedness and guarantee indebtedness; (ii) pay dividends or make other distributions or repurchase or redeem their capital stock; (iii) purchase, redeem or retire debt; (iv) issue certain preferred stock or similar equity securities; (v) make loans and investments; (vi) sell assets; (vii) incur liens; (viii) enter into transactions with affiliates; (ix) enter into agreements restricting the Company's subsidiaries' ability to pay dividends; and (x) consolidate, merge or sell all or substantially all assets. However, these covenants are subject to exceptions and qualifications.

The 5.75% Senior Notes may also be repurchased at the option of the holders in connection with a change of control (as defined in the indenture governing the 5.75% Senior Notes) or in connection with certain asset sales.

On November 4, 2013, the Company commenced a consent solicitation to amend the indentures (the “Proposed Amendment”) and to provide related waivers  with respect to its Senior Floating Rate Notes due 2015 and 5.75% Senior Notes due 2022 (the “Notes”).  The Proposed Amendment and related waivers would amend the indentures governing the Notes to make certain changes to the reporting covenants and to waive defaults that have occurred prior to the effective date of the amendments.  The Solicitation expired on November 8, 2013 (the “Expiration Date”).  As of the Expiration Date, the Company had received the requisite number of Consents required to approve the proposed Amendments and waivers and, accordingly, the Company, its U.S. subsidiaries that serve as guarantors, and U.S. Bank National Association, as trustee, executed supplemental indentures implementing the Proposed Amendment with respect to the Notes.  Under the terms of the amended indentures, the filing with the Securities and Exchange Commission of the Company’s quarterly reports on form 10-Q for the quarters ended June 28, 2013 and September 27, 2013 on or prior to March 17, 2014 would satisfy the Company’s obligations under the reporting covenants of the indentures; provided that if the Company does not comply with the reporting covenants on or before March 17, 2014, then such noncompliance will constitute an event of default as defined in the indentures.  In connection with the consent solicitation, the Company agreed to pay additional interest at the rate of 0.50% per annum to the Note holders beginning on November 1, 2013, and continuing until the earlier of (a) the date on which the Company complies with the reporting covenants and (b) March 17, 2014.  In addition, Note holders who returned valid unrevoked consents prior to the Expiration Date are also eligible to receive a lump-sum consent fee equal to 0.25% in the event that the Company has not complied with the reporting covenants on or before January 31, 2014.

Under the terms of the 5.750% Senior Notes due 2022 (the “Notes”), the Company was required to file a registration statement for the 5.75% Senior Notes on or before the 1-year anniversary of the initial issuance of the 5.75% Senior Notes on September 25, 2012.  Because the Company has not filed the registration statement for the 5.75% Senior Notes within the required time, the terms of the Notes require the Company to pay additional interest under the 5.75% Senior Notes equal to 0.25% per year beginning

on September 26, 2013 for the first 90 days of delay, and an additional 0.25% per year for each subsequent 90-day period until the registration statement is filed. 

The Company used a portion of the proceeds of the 5.75% Senior Notes to redeem all of its outstanding $200.0 million of 7.125% Senior Fixed Rate Notes that were to mature in April 2017. The Company intends to use the balance of the proceeds to (i) repay its 0.875% Convertible Notes at maturity, and for (ii) general corporate purposes. In the interim, the Company used a portion of the proceeds to repay amounts outstanding under its Revolving Credit Facility. The Company capitalized $11.8 million in deferred financing costs in connection with the 5.75% Senior Notes.

The 0.875% Convertible Notes are unconditionally guaranteed, jointly and severally, on a senior unsecured basis, by the Company’s wholly-owned U.S. subsidiaries that are borrowers or guarantors under the Company's Revolving Credit Facility. For additional information on the convertible notes, see the Company’s 2012 Amended Annual Report on Form 10-K/A.

Subordinated Convertible Notes due 2029

The Company’s Subordinated Convertible Notes were issued on December 18, 2009 in the amount of $ 429.5 million as part of an exchange offer. The notes and the common stock issuable upon conversion were registered on a Registration Statement on Form S-4, initially filed with the SEC on October 27, 2009 , as amended and as declared effective by the SEC on December 15, 2009 . At issuance, the Company separately accounted for the liability and equity components of the instrument, based on the Company’s nonconvertible debt borrowing rate on the instrument’s issuance date of 12.5% . At issuance, the liability and equity components were $162.9 million and $ 266.6 million , respectively. The equity component (debt discount) is being amortized to interest expense based on the effective interest method. There were no proceeds generated from the transaction and the Company incurred issuance fees and expenses of approximately $ 14.5 million as a result of the exchange offer which have been proportionately allocated to the liability and equity components of the Subordinated Convertible Notes.

By letter dated August 30, 2013, U.S. Bank National Association (“Trustee”), as the trustee under the note indenture dated as of December 18, 2009, by and among the Trustee and the Company (the “Indenture”), notified the Company that the Company’s failure to comply with the reporting covenants of the Indenture could constitute an event of default under the terms of the Indenture governing the Company’s Subordinated Convertible Notes due 2029 if not remedied within 60 days of August 30, 2013.   The Company did not comply with the reporting covenant within such 60 day period.  By notice to the Trustee, the Company, pursuant to the terms of the Indenture, elected to pay the note holders, as the sole and exclusive remedy for the Company’s failure to comply with the reporting covenants, additional interest at an annual rate of 0.50% of the principal amount of the Subordinated Convertible Notes due 2029 until the Company complies with the reporting covenant (but for no longer than 365 days from October 29, 2013).

 

0.875% Convertible Notes due 2013

The Company’s 0.875% Convertible Notes issued in November 2006 in the amount of $355 million matured on November 15, 2013.  The Company fully satisfied and extinguished these notes by timely tendering the notional amount to the trustee under the applicable note indenture.  The Company used cash on hand and borrowings under its Asset-Based Revolving Credit Facility to fund the retirement of the notes. 

The Company’s 0.875% Convertible Notes were issued in November of 2006 in the amount of $355.0 million . At the time of issuance, the notes and the common stock issuable upon conversion of the notes were registered on a Registration Statement on Form S-3ASR, which was renewed on September 30, 2009 when the Company filed a Renewal Registration Statement for the underlying common stock on Form S-3ASR. The Company separately accounted for the liability and equity components of the instrument, retrospectively, based on the Company’s nonconvertible debt borrowing rate on the instrument’s issuance date of 7.35% . At issuance, the liability and equity components were $ 230.9 million and $ 124.1 million , respectively. The equity component (debt discount) is being amortized to interest expense based on the effective interest method.

Concurrent with the sale of the 0.875% Convertible Notes, the Company purchased note hedges that are designed to mitigate potential dilution from the conversion of the 0.875% Convertible Notes in the event that the market value per share of the Company’s common stock at the time of exercise is greater than approximately $50.36 . Under the note hedges that cover approximately 7,048,880 shares of the Company’s common stock, the counterparties are required to deliver to the Company either shares of the Company’s common stock or cash in the amount that the Company delivers to the holders of the 0.875% Convertible Notes with respect to a conversion, calculated exclusive of shares deliverable by the Company by reason of any additional make whole premium relating to the 0.875% Convertible Notes or by reason of any election by the company to unilaterally increase the conversion rate as permitted by the indenture governing the 0.875% Convertible Notes. The note hedges expire at the close of trading on November 15, 2013 , which is also the maturity date of the 0.875% Convertible Notes, although the counterparties will have ongoing obligations with respect to 0.875% Convertible Notes properly converted on or prior to that date as to which the counterparties have been timely notified.

The Company issued warrants to counterparties that could require the Company to issue up to approximately 7,048,880 shares of the Company’s common stock in equal installments on each of the fifteen consecutive business days beginning on and including February 13, 2014 . The strike price is $ 76.00 per share, which represents a 92.4% premium over the closing price of the Company’s shares of common stock on November 9, 2006 . The warrants are expected to provide the Company with some protection against increases in the common stock price over the conversion price per share.

The note hedges and warrants are separate and legally distinct instruments that bind the Company and the counterparties and have no binding effect on the holders of the 0.875% Convertible Notes. In addition, the note hedges and warrants were recorded as a charge and an increase, respectively, in additional paid-in capital in total equity as separate equity transactions.

Proceeds from the offering were used to pay down outstanding debt by $ 87.8 million , including accrued interest, under the Company’s Terminated Credit Facility, to pay $ 124.5 million for the cost of the note hedges, and to pay transaction costs of approximately $ 9.4 million directly related to the issuance that have been allocated to the liability and equity components in proportion to the allocation of proceeds. Additionally, the Company received $ 80.4 million in proceeds from the issuance of the warrants. At the conclusion of these transactions, the net effect of the receipt of the funds from the 0.875% Convertible Notes and the payments and proceeds mentioned above was an increase in cash of approximately $ 213.7 million , which was used by the Company for general corporate purposes including acquisitions.

Senior Floating Rate Notes

The Company's $ 325.0 million in aggregate principal amount of senior unsecured notes, comprised of $125.0 million of Senior Floating Rate Notes due 2015 (the Senior Floating Rate Notes") and $200.0 million of 7.125% Senior Notes due 2017 , of which $200 million was repaid on October 12, 2012, (together, the "Notes") were offered and sold in private transactions in accordance with Rule 144A and Regulation S under the Securities Act on March 21, 2007 . An exchange offer commenced on June 11, 2007 and was completed on July 26, 2007 to replace the unregistered notes with registered notes with like terms pursuant to an effective Registration Statement on Form S-4.  

The Company may redeem the Senior Floating Rate Notes in whole or in part at a redemption price equal to 100% of the principal amount redeemed, plus accrued and unpaid interest.

The Senior Floating Rate Notes' indenture contains covenants that limit the ability of the Company and certain of its subsidiaries to (i) pay dividends on, redeem or repurchase the Company’s capital stock; (ii) incur or guarantee additional indebtedness; (iii) make investments; (iv) create liens; (v) sell assets; (vi) engage in certain transactions with affiliates; (vii) create or designate unrestricted subsidiaries; and (viii) consolidate, merge or transfer all or substantially all assets. However, these covenants are subject to important exceptions and qualifications, one of which permits the Company to declare and pay dividends or distributions on the Series A preferred stock provided there is no default on the Senior Floating Rate Notes and certain financial conditions are met.

The Senior Floating Rate Notes may also be repurchased at the option of the holders in connection with a change of control (as defined in the indenture governing the Senior Floating Rate Notes) or in connection with certain asset sales.

On November 4, 2013, the Company commenced a consent solicitation to amend the indentures (the “Proposed Amendment”) and to provide related waivers  with respect to its Senior Floating Rate Notes due 2015 and 5.75% Senior Notes due 2022 (the “Notes”).  The Proposed Amendment and related waivers would amend the indentures governing the Notes to make certain changes to the reporting covenants and to waive defaults that have occurred prior to the effective date of the amendments.  The Solicitation expired on November 8, 2013 (the “Expiration Date”).  As of the Expiration Date, the Company had received the requisite number of Consents required to approve the proposed Amendments and Waivers and, accordingly, the Company, its U.S. subsidiaries that serve as guarantors, and U.S. Bank National Association, as trustee, executed supplemental indentures implementing the Proposed Amendment with respect to the Notes.  Under the terms of the amended indentures, the filing with the Securities and Exchange Commission of the Company’s quarterly reports on form 10-Q for the quarters ended June 28, 2013 and September 27, 2013 on or prior to March 17, 2014 would satisfy the Company’s obligations under the reporting covenants of the indentures; provided that if the Company does not comply with the reporting covenants on or before March 17, 2014, then such noncompliance will constitute an event of default as defined in the indentures.  In connection with the consent solicitation, the Company agreed to pay additional interest at the rate of 0.50% per annum to the Note holders beginning on November 1, 2013, and continuing until the earlier of (a) the date on which the Company complies with the reporting covenants and (b) March 17, 2014.  In addition, Note holders who returned valid unrevoked consents prior to the Expiration Date are also eligible to receive a lump-sum consent fee equal to 0.25% in the event that the Company has not complied with the reporting covenants on or before January 31, 2014.

Proceeds from the Notes of $325.0 million , less approximately $ 7.9 million of cash payments for fees and expenses that are being amortized over the life of the Notes, were used to pay approximately $ 285.0 million for 9.5% Senior Notes, $ 9.3 million for accrued interest on the 9.5% Senior Notes and $ 20.5 million for tender fees and the inducement premium on the 9.5% Senior Notes, leaving net cash proceeds of approximately $ 2.3 million which were used for general corporate purposes.

Asset-Based Revolving Credit Facility (“Revolving Credit Facility”)

On July 21, 2011, the Company entered into a $400 million Revolving Credit Facility, which was first amended in 2012 to increase the Facility size to $700 million and then subsequently amended and restated on September 6, 2013, to, among other things, increase the Revolving Credit Facility to $1.0 billion , $630 million of which may be borrowed by the U.S. borrower, $300 million of which may be borrowed by the European borrowers and $70 million of which may be borrowed by the Canadian borrower. The Revolving Credit Facility replaced the Company's prior $400 million Senior Secured Revolving Credit Facility (“Terminated Credit Facility”), which was set to mature in July 2012. The Revolving Credit Facility contains restrictions in areas consistent with the Terminated Credit Facility, including limitations on, among other things, distributions and dividends, acquisitions and investments, indebtedness, liens and affiliate transactions. In the aggregate, however, the Revolving Credit Facility provides the Company greater flexibility than did the Terminated Credit Facility, and the restrictions in the Revolving Credit Facility generally only apply in the event that the Company's availability under the Revolving Credit Facility falls below certain specific thresholds.

The Revolving Credit Facility has a maturity date of September 6, 2018. The Revolving Credit Facility includes a springing maturity concept which is applicable only if the Company's $125 million Senior Floating Rate Notes due 2015 are not, within 90 days of their maturity, repaid or refinanced with indebtedness that matures or is mandatorily redeemable or is redeemable at the option of the holders thereof not earlier than the date that is 6 months after September 6, 2018 unless, if such notes are not repaid or refinanced, there is at least $100 million of availability and the fixed charge coverage ratio is not less than 1.15 to 1.00 , in each case after giving pro forma effect to the repayment of such notes. Springing maturity can be as early as December 31, 2014. The commitment amount under the Revolving Credit Facility may be increased by an additional $250 million , subject to certain conditions and approvals as set forth in the credit agreement. The Company capitalized $4.8 million in deferred financing costs in connection with the Revolving Credit Facility in 2011, $2.3 million in 2012 and $4.7 million the third quarter of 2013. The Revolving Credit Facility requires maintenance of a minimum fixed charge coverage ratio of 1.00 to 1.00 if availability under the Revolving Credit Facility is less than the greater of $100 million or 10% of the then existing aggregate lender commitment under

the Revolving Credit Facility. At September 27, 2013 and December 31, 2012, the Company was in compliance with all material covenants under the facility.

The Revolving Credit Facility may be used for refinancing certain existing indebtedness and for working capital and general corporate purposes. Indebtedness under the Revolving Credit Facility is secured by a first priority security interest in certain tangible and intangible property and assets of the Company and the Company's domestic subsidiaries and indebtedness under the Revolving Credit Facility related to the Canadian borrower and the European borrowers is secured by a first priority security interest in certain tangible and intangible property and assets of certain of the Company’s Canadian subsidiaries and European subsidiaries. In addition, the lenders under the Revolving Credit Facility have received a pledge of (i) 100% of the equity interests in all of the Company's domestic subsidiaries, and (ii) 65% of the voting equity interests in and 100% of the non-voting equity interests in each material foreign subsidiary directly owned by the Company and its domestic subsidiaries. Borrowings under the Revolving Credit Facility bear interest at interest rate bases elected by the Company plus an applicable margin calculated quarterly based on the Company's average availability as set forth in the credit agreement. The Revolving Credit Facility also requires the payment of a commitment fee equal to the available but unused commitments multiplied by an applicable margin of either 0.25% or 0.375% based on the average daily unused commitments.

On October 23, 2013, the Company amended its Revolving Credit Facility to extend and amend the lenders’ temporary waiver related to any default or events of default arising under the Revolving Credit Facility due to the failure of the Company to comply with certain reporting covenants contained in the indentures governing the Company’s outstanding unsecured notes.  Under the amendment, the lenders temporarily waived any default or event of default arising under the Revolving Credit Facility due to the failure of the Company to timely file its Quarterly Report on Form 10-Q for the periods ended June 28, 2013 and September 27, 2013 within the time periods prescribed by the Company’s outstanding note indentures.  The temporary waiver automatically expires on the earliest of (i) March 16, 2014, (ii) the commencement of any enforcement action, including any acceleration of the notes, under any indenture of the Company, and (iii) the occurrence of any other default or event of default under any indenture of the Company.    

The Company’s Revolving Credit Facility is summarized in the table below: