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Debt

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Debt

Debt

			March 31, 2021						December 31, 2020
Debt classified as current liabilities:
Hawesville Term Loan(1)			$	15.0					$	20.0
Hancock County industrial revenue bonds ("IRBs") due April 1, 2028, interest payable quarterly (variable interest rates (not to exceed 12%)) (2)			7.8						7.8
U.S. Revolving Credit Facility(3)			50.4						—
Debt classified as non-current liabilities:
Iceland Revolving Credit Facility (4)			—						45.0
12.0% senior secured notes due July 1, 2025, net of debt discount of $2.2 million and $2.3 million, and financing fees of $4.4 million and $4.6 million at March 31, 2021 and December 31, 2020, respectively, interest payable semiannually			243.4						243.1
Total			$	316.6					$	315.9

(1) See "Hawesville Term Loan" below. At March 31, 2021, the applicable interest rate was LIBOR of 0.2% plus margin of 5.375% and there is no interest payable outstanding. As of March 31, 2021, we have made $25.0 million of principal payments and $2.2 million of interest payments.

(2) The IRBs are classified as current liabilities because they are remarketed weekly and could be required to be repaid upon demand if there is a failed remarketing. The IRBs interest rate at March 31, 2021 was 0.2%.

(3) We have elected to incur interest at a base rate plus applicable margin as defined within the agreement. The interest rate at March 31, 2021 was 3.8%.

(4) We have elected to incur interest at LIBOR plus applicable margin as defined within the agreement.

12.0% Notes due 2025

General. On July 1, 2020, we issued $250.0 million in aggregate principal amount of 12.0% senior secured notes due 2025 (the "2025 Notes"). The 2025 Notes were issued at a discount and we received proceeds of $243.8 million, prior to payment of certain financing fees and related expenses.

Fair Value. Fair value for our 2025 Notes, based on the latest trading data available, was $268.8 million as of March 31, 2021. Although we use quoted market prices for identical debt instruments, the markets on which they trade are not considered to be active and are therefore considered Level 2 fair value measurements. In connection with the offering of the 2028 Notes described below, we commenced a cash tender offer to purchase any and all of our outstanding 2025 Notes at par plus a tender premium of $14.6 million. On April 14, 2021, we purchased $195.9 million aggregate principal amount of the 2025 Notes in the tender offer, and notified the holders of all outstanding 2025 Notes that were not purchased in the tender offer of our election to redeem all such remaining 2025 Notes on May 14, 2021.

7.5% Senior Secured Notes due 2028

As disclosed in Note 14. Subsequent Events, on April 14, 2021, we issued $250.0 million in aggregate principal amount of senior secured notes due 2028 (the "2028 Notes"). The 2028 Notes bear interest semi-annually in arrears on April 1 and October 1 of each year, beginning on October 1, 2021, at a rate of 7.5% per annum in cash.

Convertible Notes due 2028

In addition, as disclosed in Note 14. Subsequent Events, on April 9, 2021, we completed a private offering of $86.3 million aggregate principal amount of convertible senior notes due 2028 (the "Convertible Notes"). The Convertible Notes were issued at a price of 100% of their aggregate principal amount, will pay interest semi-annually in arrears on May 1 and November 1 of each year, beginning on November 1, 2021, at a rate of 2.75% per annum in cash, and will mature on May 1, 2028, unless earlier converted, repurchased, or redeemed.

Hawesville Term Loan

On April 29, 2019, we entered into a loan agreement with Glencore Ltd. pursuant to which the Company borrowed $40.0 million. Borrowings under the Hawesville Term Loan were used to partially finance the second phase of the Hawesville restart project. The Hawesville Term Loan matures on December 31, 2021 and is to be repaid in twenty-four (24) equal monthly installments of principal beginning on January 31, 2020.  The Hawesville Term Loan bears interest, due monthly, at a floating rate equal to LIBOR plus 5.375% per annum. The Hawesville Term Loan is not secured by any collateral. 

U.S. Revolving Credit Facility

We and certain of our direct and indirect domestic subsidiaries ("the Borrowers") have a senior secured revolving credit facility with a syndicate of lenders (as amended from time to time, the "U.S. revolving credit facility"). The U.S. revolving credit facility provides for borrowings of up to $175.0 million in the aggregate, including up to $110.0 million under a letter of credit sub-facility, and also includes an uncommitted accordion feature whereby borrowers may increase the capacity of the U.S. revolving credit facility by up to $50.0 million, subject to agreement with the lenders. The U.S. revolving credit facility matures on May 16, 2023.

Any letters of credit issued and outstanding under the U.S. revolving credit facility reduce our borrowing availability on a dollar-for-dollar basis. At March 31, 2021, there were $50.4 million in outstanding borrowings under our U.S. revolving credit facility. Principal payments, if any, are due upon maturity of the U.S. revolving credit facility and may be prepaid without penalty.

Status of our U.S. revolving credit facility:			March 31, 2021
Credit facility maximum amount			$	175.0
Borrowing availability			139.6
Outstanding letters of credit issued			75.4
Outstanding borrowings			50.4
Borrowing availability, net of outstanding letters of credit and borrowings			13.8

Iceland Revolving Credit Facility

Our wholly-owned subsidiary, Nordural Grundartangi ehf ("Grundartangi"), has entered into a $50.0 million revolving credit facility agreement with Landsbankinn hf., dated November 2013, as amended (the "Iceland revolving credit facility"). At March 31, 2021, there were no outstanding borrowings under our Iceland revolving credit facility. The Iceland revolving credit facility has a term through November 2022. Principal payments, if any, are due upon maturity of the Iceland revolving credit facility and may be prepaid without penalty.

Status of our Iceland revolving credit facility:			March 31, 2021
Credit facility maximum amount			$	50.0
Borrowing availability			50.0
Outstanding letters of credit issued			—
Outstanding borrowings			—
Borrowing availability, net of borrowings			50.0

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- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

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