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Debt | 3 Months Ended
--- | ---
Dec. 31, 2015
Debt Disclosure [Abstract] |
Debt | Debt The Company’s consolidated debt consists of the following:
|  | December 31, 2015 |  | September 30, 2015 |  |
|  | Amount |  | Rate |  | Amount |  | Rate |  | Interest rate
|  |  |  |  |  | (As Adjusted) |  |
HRG |  |  |  |  |  |  |  |  |  |
7.875% Senior Secured Notes, due July 15, 2019 |  | $ | 864.4 |  |  | 7.9 | % |  | $ | 864.4 |  |  | 7.9 | % |  | Fixed rate
7.75% Senior Unsecured Notes, due January 15, 2022 |  | 890.0 |  |  | 7.8 | % |  | 890.0 |  |  | 7.8 | % |  | Fixed rate
Spectrum Brands |  |  |  |  |  |  |  |  |  |
Term Loan, due June 23, 2022 |  | 1,223.9 |  |  | 3.5 | % |  | 1,226.9 |  |  | 3.9 | % |  | Variable rate, see below
CAD Term Loan, due June 23, 2022 |  | 53.9 |  |  | 4.5 | % |  | 55.7 |  |  | 4.4 | % |  | Variable rate, see below
Euro Term Loan, due June 23, 2022 |  | 246.3 |  |  | 3.5 | % |  | 255.8 |  |  | 3.5 | % |  | Variable rate, see below
6.375% Senior Notes, due November 15, 2020 |  | 520.0 |  |  | 6.4 | % |  | 520.0 |  |  | 6.4 | % |  | Fixed rate
6.625% Senior Notes, due November 15, 2022 |  | 570.0 |  |  | 6.6 | % |  | 570.0 |  |  | 6.6 | % |  | Fixed rate
6.125% Notes, due December 15, 2024 |  | 250.0 |  |  | 6.1 | % |  | 250.0 |  |  | 6.1 | % |  | Fixed rate
5.75% Notes, due July 15, 2025 |  | 1,000.0 |  |  | 5.8 | % |  | 1,000.0 |  |  | 5.8 | % |  | Fixed rate
Revolver Facility, expiring June 23, 2020 |  | 230.0 |  |  | 3.6 | % |  | — |  |  | — | % |  | Variable rate, see below
Other notes and obligations |  | 10.7 |  |  | 10.6 | % |  | 11.2 |  |  | 10.2 | % |  | Various
Obligations under capitalized leases |  | 93.6 |  |  | 5.6 | % |  | 88.2 |  |  | 5.7 | % |  | Various
Compass |  |  |  |  |  |  |  |  |  |
Compass Credit Agreement, due February 14, 2018 |  | 160.0 |  |  | 3.0 | % |  | 327.0 |  |  | 3.0 | % |  | Variable rate, see below
HGI Energy |  |  |  |  |  |  |  |  |  |
9.0% HGI Energy Note to FGL*, due February 14, 2021 |  | 50.0 |  |  | 9.0 | % |  | 50.0 |  |  | 9.0 | % |  | Fixed rate
Salus |  |  |  |  |  |  |  |  |  |
Unaffiliated long-term debt of consolidated variable-interest entity |  | 40.4 |  |  | — | % |  | 40.4 |  |  | — | % |  | Variable rate, see below
Long-term debt of consolidated variable-interest entity with FGL* |  | 196.5 |  |  | 4.8 | % |  | 274.0 |  |  | 3.9 | % |  | Variable rate, see below
Unaffiliated secured borrowings under non-qualifying loan participations |  | 8.8 |  |  | 10.5 | % |  | 8.8 |  |  | 10.5 | % |  | Fixed rate
Secured borrowings under non-qualifying loan participations with FGL* |  | — |  |  | — | % |  | 4.2 |  |  | 4.5 | % |  | Variable rate, see below
Promissory note to FGL* |  | 2.4 |  |  | 5.3 | % |  | 2.5 |  |  | 5.3 | % |  | Fixed rate
Total |  | 6,410.9 |  |  |  |  | 6,439.1 |  |  |  |  |
Original issuance discounts on debt, net of premiums |  | (25.3 | ) |  |  |  | (25.7 | ) |  |  |  |
Less unamortized debt issue costs |  | (100.2 | ) |  |  |  | (102.9 | ) |  |  |  |
Total debt |  | 6,285.4 |  |  |  |  | 6,310.5 |  |  |  |  |
Less current maturities and short-term debt |  | 45.7 |  |  |  |  | 45.1 |  |  |  |  |
Non-current portion of debt |  | $ | 6,239.7 |  |  |  |  | $ | 6,265.4 |  |  |  |  |
* The debt balances included in the Condensed Consolidated Balance Sheets and in the table above reflect transactions between the businesses held for sale and businesses held for use that are expected to continue to exist after the close of the FGL Merger. Such transactions are not eliminated in the Condensed Consolidated Financial Statements in order to appropriately reflect the continuing operations and balances held for sale. Spectrum Brands Interest terms Certain of Spectrum Brands’ debt instruments are subject to variable interest rates. At December 31, 2015, Spectrum Brands’ variable interest rate terms were as follows: (i) for the U.S. dollar denominated term loan facility (the “USD Term Loan”), either adjusted LIBOR, subject to a 0.75% floor, plus 2.75% per annum, or base rate plus 1.75% per annum; (ii) for the Canadian dollar (“CAD”) denominated term loan facility (the “CAD Term Loan”), either Canadian Dollar Offered Rate, subject to a 0.75% floor plus 3.5% per annum, or base rate plus 2.5% per annum; (iii) for the Euro denominated term loan facility (the “Euro Term Loan”), Euro Interbank Offered Rate, subject to a 0.75% floor, plus 2.75% per annum, with no base rate option available; and (iv) for the revolving credit facility (the “Revolver Facility”), either adjusted LIBOR plus 2.75% per annum or base rate plus 1.75% per annum. As a result of borrowings and payments under the Revolver Facility, at December 31, 2015, the Company had borrowing availability of $245.3, net outstanding letters of credit of $24.7. Compass As of December 31, 2015, Compass had $160.0 of outstanding indebtedness under the Compass Credit Agreement. The borrowing base is redetermined semi-annually, with Compass and the lenders having the right to request interim unscheduled redeterminations in certain circumstances. The interest rate grid ranges from LIBOR plus 269 bps to 300 bps (or Alternate Base Rate plus 325 bps to 350 bps), depending on the percentages of drawn balances to the borrowing base as defined in the agreement. On December 31, 2015, the one month LIBOR was 0.3% which resulted in an interest rate of approximately 3.0%. On November 13, 2015, Compass entered into an amendment to the terms of the Compass Credit Agreement that included a modification of the Compass’ Consolidated Leverage Ratio (as defined in the Compass Credit Agreement) whereby the maximum permitted ratio at the end of each quarter was increased to 6.00 to 1.0 through September 30, 2016. The maximum permitted Consolidated Coverage Ratio for each quarter ending after October 1, 2016 will be 4.50 to 1.00. The amendment also provided for the reduction of the borrowing base to $320.0 on November 13, 2015. Following the completion of the Compass Asset Sale and pay down of Compass indebtedness, the borrowing base under the Compass Credit Agreement was further reduced to $175.0. Concurrently with such amendment, HRG’s wholly-owned subsidiary, HGI Funding, LLC (“HGI Funding”), determined to amend its guarantee in order to continue to provide a guarantee (the “Initial Guarantee”) of a limited portion of the debt under the Compass Credit Agreement until the date of Compass’ next borrowing base redetermination (expected to be on or about June 1, 2016) and committed to make a debt or equity contribution to Compass on the date of such redetermination in an amount to be determined based on the amount of the borrowing base at such time. HGI Funding’s aggregate obligations in connection with the Initial Guarantee through the June 2016 borrowing base redetermination date are not to exceed $30.0. The guarantee was also amended to provide that HGI Funding may elect to guaranty an additional portion of the debt under the Compass Credit Agreement (the “Optional Guarantee”) in order to cure defaults under the Consolidated Leverage Ratio on any test date through September 30, 2016. HGI Funding will be required to make a debt or equity contribution to Compass in the amount of the Optional Guarantee (if any) within eleven business days of the delivery of Compass' compliance certificate under the Compass Credit Agreement for the period ending September 30, 2016. The Secured Amount is secured by a pledge of assets chosen by the Company that may consist of a combination of cash and marketable securities with a determined value equal to the maximum Secured Amount then applicable. In measuring the determined value of the pledged assets, cash is valued at 100.0% and marketable securities are valued at 33.3% of fair market value thereafter (measured as the 20 day average close price of such marketable securities). As of December 31, 2015, the Company had no amounts in the Optional Guarantee. As of December 31, 2015, $160.0 was drawn under Compass Credit Agreement. The Compass Credit Agreement matures on February 14, 2018. On December 23, 2015, Compass received the consent of the lenders under the Compass Credit Agreement to delay the delivery of Compass’ unqualified audited financial statements for the fiscal year ending September 30, 2015 until March 31, 2016. Such financial statements had previously been required to be delivered within 90 days following the end of such fiscal year. As of December 31, 2015, Compass was in good standing under the covenants specified in the Compass Credit Agreement, as amended. The expiration date of the Initial Guarantee occurs upon the closing of Compass’ scheduled borrowing base redetermination in June 2016. The expiration date of the Optional Guarantee occurs upon the making of all required payments on the Optional Guarantee Payment Date. Compass is presently current on all obligations related to the Compass Credit Agreement. HGI Energy In February 2013, in connection with the Company’s acquisition of an interest in Compass, HGI Energy entered into note purchase agreements with FGL for $50.0 notional aggregate principal amount due February 14, 2021 (the “HGI Energy Note to FGL”). The HGI Energy Note to FGL earns interest 9.0% per annum, payable semi-annually in arrears on January 1 and July 1. The HGI Energy Note to FGL is subordinated in seniority to the Compass Credit Agreement. Salus Salus acts as co-lender under some of the asset-based loans that it originates, and such loans are structured to meet the definition of a “participating interest” as defined under ASC 860-10, Transfers and Servicing. For loans originated with co-lenders that have terms that result in such a co-lender not having a qualifying “participating interest”, Salus recognizes the whole, undivided loan. Salus also reflects a secured borrowing owing to the co-lender representing their share in the undivided whole loan. As of December 31, 2015 and September 30, 2015, Salus had $8.8 of such secured borrowings to unaffiliated co-lenders outstanding related to non-qualifying “participating interests” and $0.0 and $4.2, respectively, of such secured borrowings with FGL. In February 2013, September 2013 and February 2015, Salus completed a collateralized loan obligation (“CLO”) securitization of up to $578.5 notional aggregate principal amount. At December 31, 2015 and September 30, 2015, the outstanding notional aggregate principal amount was $280.2 and $357.7, respectively, of which $40.4 was taken up by unaffiliated entities and consisted entirely of subordinated debt, and $196.5 and $274.0 was taken up by FGL and included in Assets of business held for sale in the Condensed Consolidated Balance Sheets. The obligations of the securitization is secured by the assets of the Variable Interest Entity (“VIE”), primarily asset-based loan receivables, and at December 31, 2015 carried a variable interest rate ranging from LIBOR plus 2.37% to LIBOR plus 11.5% for the senior tranches. The subordinated tranches carry residual interest subject to maintenance of certain covenants. Due to losses incurred in the CLO, at December 31, 2015 and September 30, 2015, the CLO was not accruing interest on the subordinated debt. In February 2015, Salus signed a $2.5 Senior Secured promissory note with FGL originally due on May 29, 2015, which has been extended to February 26, 2016 with fixed interest of 5.3% to be paid semi-annually.

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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 Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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