NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) (Dollar amounts in thousands except per share data) Note 12—Stock-Based Compensation (continued) Additional information concerning Torchmark’s unvested options is as follows:
## Table 0 ##
Torchmark expects that substantially all unvested options will vest.
The following table summarizes information about stock options outstanding at December 31, 2006
## Table 1 ##
The contractual life of one option was extended in 2005 for the benefit of a retiring officer.
This modification, which was accounted for under the intrinsic value method, resulted in an after-tax charge of $369 thousand.
No equity awards were cash settled during the three years ended December 31, 2006.
Note 13—Business Segments Torchmark’s segments are based on the insurance product lines it markets and administers: life insurance, health insurance, and annuities.
These major product lines are set out as segments because of the common characteristics of products within these categories, comparability of margins, and the similarity in regulatory environment and management techniques.
There is also an investment segment which manages the investment portfolio, debt, and cash flow for the insurance segments and the corporate function.
Torchmark’s management evaluates the overall performance of the operations of the Company in accordance with these segments.
Life insurance products include traditional and interest-sensitive whole life insurance as well as term life insurance.
Health products are generally guaranteed-renewable and include Medicare Supplement, Medicare Part D, cancer, accident, long-term care, and limited-benefit hospital and surgical coverages.
Annuities include both fixed-benefit and variable contracts.
Variable contracts allow policyholders to choose from a variety of mutual funds in which to direct their deposits.
Torchmark markets its insurance products through a number of distribution channels, each of which sells the products of one or more of Torchmark’s insurance segments.
The tables below present segment premium revenue by each of Torchmark’s marketing groups.
Market Risk Sensitivity.
Torchmark’s financial securities are exposed to interest rate risk, meaning the effect of changes in financial market interest rates on the current fair value of the company’s investment portfolio.
Since 94% of the book value of our investments is attributable to fixed-maturity investments (and virtually all of these investments are fixed-rate investments), the portfolio is highly subject to market risk.
Declines in market interest rates generally result in the fair value of the investment portfolio exceeding the book value of the portfolio and increases in interest rates cause the fair value to decline below the book value.
Under normal market conditions, we do not expect to realize these unrealized gains and losses because it is generally our investment strategy to hold these investments to maturity.
The long-term nature of our insurance policy liabilities and strong cash-flow operating position substantially mitigate any future need to liquidate portions of the portfolio.
The increase or decrease in the fair value of insurance liabilities and debt due to increases or decreases in market interest rates largely offset the impact of rates on the investment portfolio.
However, in accordance with GAAP, these liabilities are not marked to market.
The following table illustrates the market risk sensitivity of our interest-rate sensitive fixed-maturity portfolio at December 31, 2010 and 2009.
This table measures the effect of a change in interest rates (as represented by the U. S.  Treasury curve) on the fair value of the fixed-maturity portfolio.
The data measures the change in fair value arising from an immediate and sustained change in interest rates in increments of 100 basis points.
## Table 2 ##
Realized Gains and Losses.
Our life and health insurance companies collect premium income from policyholders for the eventual payment of policyholder benefits, sometimes paid many years or even decades in the future.
In addition to the payment of these benefits, we also incur acquisition costs, administrative expenses, and taxes as a part of insurance operations.
Because benefits are expected to be paid in future periods, premium receipts in excess of current expenses are invested to provide for these obligations.
For this reason, we hold a significant investment portfolio as a part of our core insurance operations.
This portfolio consists primarily of high-quality fixed maturities containing an adequate yield to provide for the cost of carrying these long-term insurance product obligations.
As a result, fixed maturities are generally held for long periods to support the liabilities.
Expected yields on these investments are taken into account when setting insurance premium rates and product profitability expectations.
Because our investment portfolio is large and diverse, investments are occasionally sold or called, resulting in a realized gain or loss.
These gains and losses occur only incidentally, usually as the result of sales because of deterioration in investment quality of issuers or calls by the issuers.
Investment losses are also caused by writedowns due to impairments.
We do not engage in trading investments for profit.
Therefore, gains or losses which occur in protecting the portfolio or its yield, or which result from events that are beyond our control, are only secondary to our core insurance operations of providing insurance coverage to policyholders.
Realized gains and losses can be significant in relation to the earnings from core insurance operations, and as a result, can have a material positive or negative impact on net income.
The significant fluctuations caused by gains and losses can cause the period-to-period trends of net income not to be indicative of historical core operating results nor predictive of the future trends of core operations.
Accordingly, they have no bearing on core insurance operations or segment results as we view operations.
For these reasons, and in line with industry practice, we remove the effects of realized gains and losses when evaluating overall insurance operating results.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) (Dollar amounts in thousands except per share data) Note 1—Significant Accounting Policies (continued) Recognition of Premium Revenue and Related Expenses: Premium income for traditional long-duration life and health insurance products is recognized when due from the policyholder.
Premiums for short-duration health contracts are recognized as revenue over the contract period in proportion to the insurance protection provided.
Premiums for universal life-type and annuity contracts are added to the policy account value, and revenues for such products are recognized as charges to the policy account value for mortality, administration, and surrenders (retrospective deposit method).
Life premium includes policy charges of $18 million, $19 million, and $21 million for the years ended December 31, 2016, 2015, and 2014, respectively.
Other premium consists of annuity policy charges in each year.
For most insurance products, the related benefits and expenses are matched with revenues by means of the provision of future policy benefits and the amortization of deferred acquisition costs in a manner which recognizes profits as they are earned over the revenue recognition period.
For limited-payment life insurance products, the profits are recognized over the contract period.
Stock-Based Compensation: Torchmark accounts for stock-based compensation by recognizing an expense in the financial statements based on the “fair value method.
” The fair value method requires that a fair value be assigned to a stock option or other stock grant on its grant date and that this value be amortized over the grantees’ service period.
The fair value method requires the use of an option valuation model to value employee stock options.
Torchmark has elected to use the Black-Scholes valuation model for option expensing.
A summary of assumptions for options granted in each of the three years 2014 through 2016 is as follows:
## Table 3 ##
The expected term is generally derived from Company experience.
However, expected terms are determined based on the simplified method as permitted under the ASC 718 Stock Compensation topic when company experience is insufficient.
The Torchmark Corporation 2011 Incentive Plan replaced all previous plans and allows for option grants for employees with a ten-year contractual term which vest over five years in addition to seven-year grants which vest over three years as permitted by the previous plans.
Director grants vest over six months.
The Company has sufficient experience with seven-year grants that vest in three years, but insufficient historical experience with five-year vesting.
Therefore, Torchmark has used the simplified method to determine the expected term for the ten-year grants with fiveyear vesting and will do so until adequate experience is developed.
Volatility and risk-free interest rates are assumed over a period of time consistent with the expected term of the option.
Volatility is measured on a historical basis.
Monthly data points are utilized to derive volatility for periods greater than three years.
Expected dividend yield is based on current dividend yield held constant over the expected term.
Once the fair value of an option has been determined, it is amortized on a straight-line basis over the employee’s service period for that grant (from the grant date to the date the grant is fully vested).
Expenses for restricted stock and restricted stock units are based on the grant date fair value allocated on a straight-line basis over the service period.
Performance share expense is recognized based on management’s estimate of the probability of meeting the metrics identified in the performance share award agreement, assigned to each service period as these estimates develop.
Torchmark management views all stock-based compensation expense as a corporate or Parent Company expense and, therefore, presents it as such in its segment analysis (See Note 14—Business Segments).
It is included in “Other operating expense” in the Consolidated Statements of Operations.
Notes to the Consolidated Financial Statements costs related to these notes, which totaled $17 million, will be amortized to interest expense over the respective terms of the notes.
In August 2010, PPG entered into a three-year credit agreement with several banks and financial institutions (the "2010 Credit Agreement") which was subsequently terminated in July 2012.
The 2010 Credit Agreement provided for a $1.2 billion unsecured revolving credit facility.
In connection with entering into the 2010 Credit Agreement, the Company Notes to the Consolidated Financial Statements costs related to these notes, which totaled $17 million, will be amortized to interest expense over the respective terms of the notes.
In August 2010, PPG entered into a three-year credit agreement with several banks and financial institutions (the "2010 Credit Agreement") which was subsequently terminated in July 2012.
The 2010 Credit Agreement provided for a $1.2 billion unsecured revolving credit facility.
In connection with entering into the 2010 Credit Agreement, the Company terminated its €650 million and its $1 billion revolving credit facilities that were each set to expire in 2011.
There were no outstanding amounts due under either revolving facility at the times of their termination.
The 2010 Credit Agreement was set to terminate on August 5, 2013.
PPG¡¯s non-U.
S.  operations have uncommitted lines of credit totaling $705 million of which $34 million was used as of December 31, 2012.
These uncommitted lines of credit are subject to cancellation at any time and are generally not subject to any commitment fees.
Short-term debt outstanding as of December 31, 2012 and 2011, was as follows:
## Table 4 ##
PPG is in compliance with the restrictive covenants under its various credit agreements, loan agreements and indentures.
The Company¡¯s revolving credit agreements include a financial ratio covenant.
The covenant requires that the amount of total indebtedness not exceed 60% of the Company¡¯s total capitalization excluding the portion of accumulated other comprehensive income (loss) related to pensions and other postretirement benefit adjustments.
As of December 31, 2012, total indebtedness was 42% of the Company¡¯s total capitalization excluding the portion of accumulated other comprehensive income (loss) related to pensions and other postretirement benefit adjustments.
Additionally, substantially all of the Company¡¯s debt agreements contain customary crossdefault provisions.
Those provisions generally provide that a default on a debt service payment of $10 million or more for longer than the grace period provided (usually 10 days) under one agreement may result in an event of default under other agreements.
None of the Company¡¯s primary debt obligations are secured or guaranteed by the Company¡¯s affiliates.
Interest payments in 2012, 2011 and 2010 totaled $219 million, $212 million and $189 million, respectively.
In October 2009, the Company entered into an agreement with a counterparty to repurchase up to 1.2 million shares of the Company¡¯s stock of which 1.1 million shares were purchased in the open market (465,006 of these shares were purchased as of December 31, 2009 at a weighted average price of $56.66 per share).
The counterparty held the shares until September of 2010 when the Company paid $65 million and took possession of these shares.
Rental expense for operating leases was $233 million, $249 million and $233 million in 2012, 2011 and 2010, respectively.
The primary leased assets include paint stores, transportation equipment, warehouses and other distribution facilities, and office space, including the Company¡¯s corporate headquarters located in Pittsburgh, Pa.
Minimum lease commitments for operating leases that have initial or remaining lease terms in excess of one year as of December 31, 2012, are (in millions) $171 in 2013, $135 in 2014, $107 in 2015, $83 in 2016, $64 in 2017 and $135 thereafter.
The Company had outstanding letters of credit and surety bonds of $119 million as of December 31, 2012.
The letters of credit secure the Company¡¯s performance to third parties under certain self-insurance programs and other commitments made in the ordinary course of business.
As of December 31, 2012 and 2011, guarantees outstanding were $96 million and $90 million, respectively.
The guarantees relate primarily to debt of certain entities in which PPG has an ownership interest and selected customers of certain of the Company¡¯s businesses.
A portion of such debt is secured by the assets of the related entities.
The carrying values of these guarantees were $11 million and $13 million as of December 31, 2012 and 2011, respectively, and the fair values were $11 million and $21 million, as of December 31, 2012 and 2011, respectively.
The fair value of each guarantee was estimated by comparing the net present value of two hypothetical cash flow streams, one based on PPG¡¯s incremental borrowing rate and the other based on the borrower¡¯s incremental borrowing rate, as of the effective date of the guarantee.
Both streams were discounted at a risk free rate of return.
The Company does not believe any loss related to these letters of credit, surety bonds or guarantees is likely.9.
Fair Value Measurement The accounting guidance on fair value measurements establishes a hierarchy with three levels of inputs used to determine fair value.
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets and liabilities, are considered to be the most reliable evidence of fair value, and should be used whenever available.
Level 2 inputs are observable prices that are not quoted on active exchanges.
Level 3 inputs are unobservable inputs employed for measuring the fair value of assets or liabilities.

<table><tr><td>Number of shares outstanding</td><td>1,447,618</td></tr><tr><td>Weighted-average exercise price (per share)</td><td>$55.50</td></tr><tr><td>Weighted-average remaining contractual term (in years)</td><td>6.05</td></tr><tr><td>Aggregate intrinsic value</td><td>$11,950</td></tr></table>
<table><tr><td></td><td></td><td colspan="2"> Options Outstanding </td><td colspan="2"> Options Exercisable </td></tr><tr><td> Range of Exercise Prices </td><td> Number Outstanding </td><td> Weighted- Average Remaining Contractual Life (Years)</td><td> Weighted- Average Exercise Price </td><td> Number Exercisable </td><td> Weighted- Average Exercise Price </td></tr><tr><td>$15.95-$38.79</td><td>1,094,937</td><td>4.31</td><td>$34.90</td><td>964,418</td><td>$35.04</td></tr><tr><td>41.26- 41.26</td><td>1,343,012</td><td>4.57</td><td>41.26</td><td>1,343,012</td><td>41.26</td></tr><tr><td>41.75- 54.50</td><td>1,009,143</td><td>6.55</td><td>45.30</td><td>986,113</td><td>45.30</td></tr><tr><td>54.77- 54.77</td><td>4,068,495</td><td>5.24</td><td>54.77</td><td>4,068,495</td><td>54.77</td></tr><tr><td>55.05- 55.80</td><td>996,806</td><td>5.82</td><td>55.49</td><td>83,130</td><td>55.68</td></tr><tr><td>56.24- 56.24</td><td>869,042</td><td>7.53</td><td>56.24</td><td>864,949</td><td>56.24</td></tr><tr><td>56.78- 63.70</td><td>447,300</td><td>7.09</td><td>62.72</td><td>71,000</td><td>57.52</td></tr><tr><td>$15.95-$63.70</td><td>9,828,735</td><td>5.52</td><td>$50.30</td><td>8,381,117</td><td>$49.40</td></tr></table>
<table><tr><td></td><td colspan="2"> Market Valueof Fixed Maturity Portfolio ($ millions)</td></tr><tr><td> Change in Interest Rates (in basis points)</td><td> At December 31, 2010</td><td> At December 31, 2009</td></tr><tr><td>-200</td><td>$12,919</td><td>$11,203</td></tr><tr><td>-100</td><td>11,656</td><td>10,070</td></tr><tr><td>-0-</td><td>10,543</td><td>9,104</td></tr><tr><td>100</td><td>9,559</td><td>8,276</td></tr><tr><td>200</td><td>8,686</td><td>7,561</td></tr></table>
<table><tr><td></td><td>2016</td><td>2015</td><td>2014</td></tr><tr><td>Volatility factor</td><td>19.2%</td><td>23.6%</td><td>30.9%</td></tr><tr><td>Dividend yield</td><td>1.1%</td><td>0.9%</td><td>0.9%</td></tr><tr><td>Expected term (in years)</td><td>5.78</td><td>5.66</td><td>5.65</td></tr><tr><td>Risk-free rate</td><td>1.3%</td><td>1.6%</td><td>1.9%</td></tr></table>
<table><tr><td>(Millions)</td><td>2012</td><td>2011</td></tr><tr><td>Other, weighted average 2.27% as of Dec. 31, 2012 and 3.72% as of December 31, 2011</td><td>$39</td><td>$33</td></tr><tr><td>Total</td><td>$39</td><td>$33</td></tr></table>

Question: as of december 31 , 2012 , how much room does the company have in its restrictive covenant regarding debt to total capitalization?