Financing Agreements |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2015 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Financing Agreements |
Financing Agreements
With respect to the Facility, as of December 31, 2015, we had $15.1 in outstanding letters of credit issued and $479.8 of maximum borrowing capacity. $343.7 of borrowing capacity is immediately available based on our leverage covenant at December 31, 2015, with additional amounts available in the event of a qualifying acquisition. The weighted-average interest rates on borrowings under the Facility were 1.21% and 1.27% for the three months ended December 31, 2015 and 2014. The weighted average facility fee was 0.18% and 0.25% for the three months ended December 31, 2015 and 2014. The weighted average interest rate on the term loan was 1.46% and 1.54% for the three months ended December 31, 2015 and 2014.
In the normal course of business, the Process Equipment Group provides to certain customers bank guarantees and other credit
arrangements in support of performance, warranty, advance payment, and other contractual obligations. This form of trade
finance is customary in the industry and, as a result, we are required to maintain adequate capacity to provide the guarantees. As of December 31, 2015, we had credit arrangements totaling $213.3, under which $124.5 was utilized for this purpose. These arrangements included our €150.0 Syndicated Letter of Guarantee Facility (as amended, the “LG Facility”) and other ancillary credit facilities.
The availability of borrowings under the Facility, the LG Facility, and the Private Shelf Agreement, dated as of December 6, 2012 (the “Shelf Agreement”), among the Company, Prudential Investment Management and each Prudential Affiliate (as defined thereunder), governing the 4.60% Series A unsecured notes (the “Series A Notes”), is subject to our ability to meet certain conditions including compliance with covenants, absence of default, and continued accuracy of certain representations and warranties. Financial covenants include a maximum ratio of Indebtedness to EBITDA (as defined in the agreements) of 3.5 to 1.0 and a minimum ratio of EBITDA to interest expense of 3.5 to 1.0. As of December 31, 2015, we were in compliance with all covenants.
The Facility, senior unsecured notes, Series A Notes, and LG Facility are fully and unconditionally guaranteed by certain of the
Company’s domestic subsidiaries.
We had restricted cash of $0.7 and $0.8 at December 31, 2015 and September 30, 2015.
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