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## NOTE 8 – FINANCINg ArrANgEMENTs 

Short-term debt for the years ended December 31 was as follows: 

<img src='content_image/213350.jpg'>

The lines of credit for certain of the Company’s foreign subsidiaries provide for borrowings up to $242.4 million. Most of these lines of credit are uncommitted. At December 31, 2011, the Company’s foreign subsidiaries had borrowings outstanding of $22.0 million and guarantees of $8.3 million, which reduced the availability under these facilities to $212.1 million. 

The weighted average interest rate on short-term debt during the year was 4.1% in 2011, 4.3% in 2010 and 3.7% in 2009. The weighted average interest rate was 3.6% on short-term debt outstanding at December 31, 2011 and 2010. 

The Company has a $150 million Accounts Receivable Securitization Financing Agreement (Asset Securitization Agreement), which matures November 10, 2012. Under the terms of the Asset Securitization Agreement, the Company sells, on an ongoing basis, certain domestic trade receivables to Timken Receivables Corporation, a wholly-owned consolidated subsidiary that in turn uses the trade receivables to secure borrowings which are funded through a vehicle that issues commercial paper in the short-term market. Borrowings under the agreement are limited to certain borrowing base calculations. Any amounts outstanding under this Asset Securitization Agreement would be reported in the short-term debt on the Company’s Consolidated Balance Sheets. As of December 31, 2011 and 2010, there were no outstanding borrowings under the Asset Securitization Agreement. The cost of this facility, which is the commercial paper rate plus program fees, is considered a financing cost and is included in interest expense in the Consolidated Statements of Income. The yield rate was 1.25%, 1.34% and 1.53%, at December 31, 2011, 2010 and 2009, respectively. 

Long-term debt for the years ended December 31 was as follows: 

<img src='content_image/213351.jpg'>

