INTL FCStone 2014 Annual Report Download - page 100

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INTL FCSTONE INC. Form 10K84
PART II
ITEM 8 Financial Statements and Supplementary Data
interest at a rate per annum equal to 2.50% plus the Federal Funds
Rate, as defined. e agreement contains financial covenants related
to consolidated tangible net worth, as defined. INTL FCStone
Ltd was in compliance with this covenant as of September 30,
2014. INTL FCStone, Ltd paid minimal debt issuance costs in
connection with this credit facility. e facility is guaranteed
by the Company.
Senior Unsecured Notes
In July 2013, the Company completed the offering of $45.5 million
aggregate principal amount of the Company’s 8.5% Senior
Notes due 2020 (the “Notes”). e net proceeds of the sale of
the Notes are being used for general corporate purposes. e
Notes were issued under an Indenture dated as of July 22, 2013,
between the Company and e Bank of New York Mellon, as
Trustee. e Notes bear interest at a rate of 8.5% per year (payable
quarterly on January 30, April 30, July 30 and October 30 of each
year). e Notes will mature on July 30, 2020. e Company
may redeem the Notes, in whole or in part, at any time on and
after July 30, 2016, at a redemption price equal to 100% of the
principal amount redeemed plus accrued and unpaid interest
to, but not including, the redemption date. e Company
incurred debt issuance costs of $1.7 million in connection with
the issuance of the Notes, which are being amortized over the
term of the Notes.
e following table sets forth a listing of credit facilities, the
committed amounts as of September 30, 2014 on the facilities,
and outstanding borrowings on the facilities as well as indebtedness
on senior notes as of September 30, 2014 and 2013:
CREDIT FACILITIES
(in millions)
Borrower Security Renewal/Expiration Date
Total
Commitment
Amounts Outstanding
September 30,
2014
September 30,
2013
INTL FCStone Inc. Certain pledged shares September 20, 2016 $ 140.0 $ 15.0 $ 55.0
FCStone, LLC None April 9, 2015 75.0 — —
FCStone Merchants Certain commodities assets May 1, 2015 30.0 7.5 6.0
INTL FCStone, Ltd None November 5, 2015 25.0 — —
$ 270.0 $ 22.5 $ 61.0
SENIOR UNSECURED NOTES
8.50% senior notes, due July 30, 2020 45.5 45.5
Total indebtedness $ 68.0 $ 106.5
As noted above, $105 million of the Company’s committed credit facilities are scheduled to expire during the fiscal year ended
September 30, 2015. e Company intends to renew or replace these facilities as they expire, and based on the Company’s liquidity
position and capital structure, the Company believes it will be able to do so.
NOTE 11 Commitments and Contingencies
Legal Proceedings
Certain conditions may exist as of the date the financial statements
are issued, which may result in a loss to the Company but which
will only be resolved when one or more future events occur or
fail to occur. e Company assesses such contingent liabilities,
and such assessment inherently involves an exercise of judgment.
In assessing loss contingencies related to legal proceedings that
are pending against the Company or unasserted claims that may
result in such proceedings, the Company’s legal counsel evaluates
the perceived merits of any legal proceedings or unasserted claims
as well as the perceived merits of the amount of relief sought or
expected to be sought therein.
If the assessment of a contingency indicates that it is probable
that a material loss had been incurred at the date of the financial
statements and the amount of the liability can be estimated, then
the estimated liability would be accrued in the Company’s financial
statements. If the assessment indicates that a potentially material
loss contingency is not probable, but is reasonably possible, or
is probable but cannot be estimated, then the nature of the
contingent liability, together with an estimate of the range of
possible loss if determinable and material, would be disclosed.
Neither accrual nor disclosure is required for loss contingencies
that are deemed remote. e Company accrues legal fees related
to contingent liabilities as they are incurred.
In addition to the matters discussed below, from time to time
and in the ordinary course of business, the Company is involved
in various legal actions and proceedings, including tort claims,
contractual disputes, employment matters, workers’ compensation
claims and collections. e Company carries insurance that
provides protection against certain types of claims, up to the
policy limits of the insurance.
As of September 30, 2014 and 2013, the consolidated balance
sheets include loss contingency accruals, recorded during and
prior to these fiscal years then ended, which are not material,