|9 Months Ended|
Jun. 30, 2017
|Debt Disclosure [Abstract]|
With respect to the revolving credit facility, as of June 30, 2017, we had $8.5 in outstanding letters of credit issued and $496.5 of maximum borrowing capacity. $397.3 of this borrowing capacity is immediately available based on our leverage covenant at June 30, 2017, with additional amounts available in the event of a qualifying acquisition. The weighted-average interest rates on borrowings under the revolving credit facility were 1.46% and 1.43% for the three and nine months ended June 30, 2017, and 1.60% and 1.43% for the same periods in the prior year. The weighted average facility fee was 0.23% for the three and nine months ended June 30, 2017, and 0.24% and 0.21% for the same periods in the prior year. The weighted average interest rate on the term loan was 2.39% and 2.16% for the three and nine months ended June 30, 2017, and 1.90% and 1.71% for the same periods in the prior year. We have interest rate swaps on $50.0 of outstanding borrowings under the revolving credit facility in order to manage exposure to our variable interest payments. We have cross currency swaps on $55.0 of outstanding borrowings under the revolving credit facility to manage currency and interest rate risk exposure on foreign currency denominated debt. The cross currency swaps are not designated as hedging instruments for accounting purposes.
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 June 30, 2017, we had credit arrangements totaling $218.7, under which $129.4 was utilized for this purpose. These arrangements include our €150.0 Syndicated Letter of Guarantee Facility (as amended, the “LG Facility”) and other ancillary guarantee facilities.
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”), require us 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 (as defined in the agreements) to interest expense of 3.5 to 1.0. As of June 30, 2017, 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 $3.4 and $0.8 included in other current assets in the Consolidated Balance Sheets at June 30, 2017 and September 30, 2016.
In April 2015, the FASB issued ASU 2015-03, Interest - Imputation of Interest, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This standard became effective and was retrospectively adopted for our fiscal year beginning October 1, 2016. As of June 30, 2017 and September 30, 2016, there were $1.0 and $1.2 in debt issuance costs recorded as a reduction in the carrying value of the related debt liability under the senior unsecured notes and Series A Notes. The $1.0 in debt issuance costs as of June 30, 2017 will be amortized over the remaining term of the senior unsecured notes and Series A Notes.
The entire disclosure for long-term debt.
Reference 1: http://www.xbrl.org/2003/role/presentationRef