Debt

3 Months Ended

Dec. 31, 2020

Debt Capitalization

Long-term debt, all of which was issued by Acquisition Corp., consists of the following:


	December 31, 2020		September 30, 2020
	(in millions)
Revolving Credit Facility (a)	$	—	$	—
Senior Term Loan Facility due 2023 (b)	815		814
3.625% Senior Secured Notes due 2026 (c)	545		521
2.750% Senior Secured Notes due 2028 (d)	392		375
3.875% Senior Secured Notes due 2030 (e)	529		529
3.000% Senior Secured Notes due 2031 (f)	784		544
5.500% Senior Notes due 2026 (g)	322		321
Total long-term debt, including the current portion (h)	$	3,387	$	3,104

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(a)Reflects $300 million of commitments under the Revolving Credit Facility, less letters of credit outstanding of approximately $10 million at both December 31, 2020 and September 30, 2020. There were no loans outstanding under the Revolving Credit Facility at December 31, 2020 or September 30, 2020.

(b)Principal amount of $820 million at both December 31, 2020 and September 30, 2020 less unamortized discount of $1 million and $1 million and unamortized deferred financing costs of $4 million and $5 million at December 31, 2020 and September 30, 2020, respectively. On January 20, 2021, Acquisition Corp. entered into an amendment of the credit agreement governing the Senior Term Loan Facility which, among other things, extends the maturity date of its outstanding term loans from November 1, 2023 to January 20, 2028 and removes a number of negative covenants limiting the ability of Acquisition Corp. to take various actions. See Note 15.

(c)Face amount of €445 million at both December 31, 2020 and September 30, 2020. Above amounts represent the dollar equivalent of such note at December 31, 2020 and September 30, 2020. Principal amount of $543 million and $519 million at December 31, 2020 and September 30, 2020, respectively, an additional issuance premium of $7 million, less unamortized deferred financing costs of $5 million at both December 31, 2020 and September 30, 2020.

(d)Face amount of €325 million at both December 31, 2020 and September 30, 2020. Above amounts represent the dollar equivalent of such note at December 31, 2020 and September 30, 2020. Principal amount of $396 million and $379 million at

December 31, 2020 and September 30, 2020, respectively, less unamortized deferred financing costs of $4 million and $4 million at both December 31, 2020 and September 30, 2020.

(e)Principal amount of $535 million less unamortized deferred financing costs of $6 million at both December 31, 2020 and September 30, 2020.

(f)Principal amount of $800 million and $550 million at December 31, 2020 and September 30, 2020, respectively, less unamortized discount of $7 million at December 31, 2020 and unamortized deferred financing costs of $9 million and $6 million at December 31, 2020 and September 30, 2020, respectively. On November 2, 2020, Acquisition Corp. issued an additional $250 million in aggregate principal amount of its 3.000% Senior Secured Notes due 2031.

(g)Principal amount of $325 million less unamortized deferred financing costs of $3 million and $4 million at December 31, 2020 and September 30, 2020.

(h)Principal amount of debt of $3.419 billion and $3.127 billion, an additional issuance premium of $7 million and $7 million, less unamortized discount of $8 million and $1 million and unamortized deferred financing costs of $31 million and $29 million at December 31, 2020 and September 30, 2020, respectively.

The Company is the direct parent of Holdings, which is the direct parent of Acquisition Corp. As of December 31, 2020 Acquisition Corp. had issued and outstanding the 3.625% Senior Secured Notes due 2026, the 5.500% Senior Notes due 2026, the 2.750% Senior Secured Notes due 2028, the 3.875% Senior Secured Notes due 2030 and the 3.000% Senior Secured Notes due 2031 (together, the “Acquisition Corp. Notes”).

The 3.625% Senior Secured Notes due 2026 and the 5.500% Senior Notes due 2026 are guaranteed by the Company. The Company’s guarantee of the Acquisition Corp. Notes is full and unconditional. All of the Acquisition Corp. Notes are guaranteed by all of Acquisition Corp.’s domestic wholly-owned subsidiaries. The guarantee of the Acquisition Corp. Notes by Acquisition Corp.’s domestic wholly-owned subsidiaries is full, unconditional and joint and several. The secured notes are guaranteed on a senior secured basis and the unsecured notes are guaranteed on an unsecured senior basis.

The Company and Holdings are holding companies that conduct substantially all of their business operations through Acquisition Corp. Accordingly, the ability of the Company and Holdings to obtain funds from their subsidiaries is restricted by the indentures for the Acquisition Corp. Notes, as well as the credit agreements for the Acquisition Corp. Senior Credit Facilities, including the Revolving Credit Facility and the Senior Term Loan Facility.

Recent Transactions

Additional 3.000% Senior Secured Notes

On November 2, 2020, Acquisition Corp. issued and sold $250 million of additional 3.000% Senior Secured Notes (the “Additional Notes”). Interest on the Additional Notes will accrue at the rate of 3.000% per annum and will be payable semi-annually in arrears on February 15 and August 15, commencing on February 15, 2021. Acquisition Corp. had the option to repurchase all or a portion of the Additional Notes at any time on one or more occasions on or prior to the fifth business day after December 18, 2020 (the “Special Optional Redemption Election Date”), but did not exercise its option to repurchase. The Additional Notes were not initially fungible with the 3.000% Senior Secured Notes issued on August 12, 2020 (the “Original Notes”). Following the Special Optional Redemption Election Date, Acquisition Corp. caused the Additional Notes to bear the same CUSIP and ISIN numbers as the Original Notes (the “CUSIP Merger Event”). Following the CUSIP Merger Event, the Additional Notes have identical terms as (other than the issue date and the issue price) and are fungible with, and treated as a single series of senior secured debt securities with, the Original Notes.

Interest Rates

The loans under the Revolving Credit Facility bear interest at Acquisition Corp.’s election at a rate equal to (i) the rate for deposits in the borrowing currency in the London interbank market (adjusted for maximum reserves) for the applicable interest period (“Revolving LIBOR”) subject to a zero floor, plus 1.75% per annum in the case of Initial Revolving Loans (as defined in the Revolving Credit Agreement), or 1.875% per annum in the case of 2020 Revolving Loans (as defined in the Revolving Credit Agreement), or (ii) the base rate, which is the highest of (x) the corporate base rate established by the administrative agent from time to time, (y) 0.50% in excess of the overnight federal funds rate and (z) the one-month Revolving LIBOR plus 1.0% per annum, plus, in each case, 0.75% per annum in the case of Initial Revolving Loans, or 0.875% per annum in the case of 2020 Revolving Loans; provided that, in respect of 2020 Revolving Loans, the applicable margin with respect to such loans is subject to adjustment as set forth in the pricing grid in the Revolving Credit Agreement. Based on the Senior Secured Indebtedness to EBITDA Ratio of 3.15x at December 31, 2020, the applicable margin for Eurodollar loans would be 1.625% instead of 1.875% and the applicable margin for ABR loans would be 0.625% instead of 0.875% in the case of 2020 Revolving Loans. If there is a payment default at any time, then the interest rate applicable to overdue principal will be the rate otherwise applicable to such loan plus 2.0% per annum. Default

interest will also be payable on other overdue amounts at a rate of 2.0% per annum above the amount that would apply to an alternative base rate loan.

The loans under the Senior Term Loan Facility bear interest at Acquisition Corp.’s election at a rate equal to (i) the rate for deposits in U.S. dollars in the London interbank market (adjusted for maximum reserves) for the applicable interest period (“Term Loan LIBOR”) subject to a zero floor, plus 2.125% per annum or (ii) the base rate, which is the highest of (x) the corporate base rate established by the administrative agent as its prime rate in effect at its principal office in New York City from time to time, (y) 0.50% in excess of the overnight federal funds rate and (z) one-month Term Loan LIBOR, plus 1.00% per annum, plus, in each case, 1.125% per annum. If there is a payment default at any time, then the interest rate applicable to overdue principal and interest will be the rate otherwise applicable to such loan plus 2.0% per annum. Default interest will also be payable on other overdue amounts at a rate of 2.0% per annum above the amount that would apply to an alternative base rate loan.

The Company has entered into, and in the future may enter into, interest rate swaps to manage interest rate risk. Please refer to Note 11 of our consolidated financial statements for further discussion.

Maturity of Senior Term Loan Facility

The loans outstanding under the Senior Term Loan Facility mature on November 1, 2023. On January 20, 2021, Acquisition Corp. entered into an amendment of the credit agreement governing the Senior Term Loan Facility which, among other things, extends the maturity date of its outstanding term loans from November 1, 2023 to January 20, 2028 and removes a number of negative covenants limiting the ability of Acquisition Corp. to take various actions.

Maturity of Revolving Credit Facility

The maturity date of the Revolving Credit Facility is April 3, 2025.

Maturities of Senior Notes and Senior Secured Notes

As of December 31, 2020, there are no scheduled maturities of notes until 2026, when $868 million is scheduled to mature. Thereafter, $1.731 billion is scheduled to mature.

Interest Expense, net

Total interest expense, net was $31 million and $33 million for the three months ended December 31, 2020 and December 31, 2019, respectively. The weighted-average interest rate of the Company’s total debt was 3.7% at December 31, 2020, 3.7% at September 30, 2020 and 4.2% at December 31, 2019.