Sunbeam 2011 Annual Report Download - page 52

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Notes to Consolidated Financial Statements
Jarden Corporation Annual Report 2011 (Dollars in millions, except per share data and unless otherwise indicated)
The proceeds from the Facility and cash on hand were used to extinguish the entire principal amount outstanding of approximately
$1.1 billion under the Company’s prior senior secured credit facility and the entire principal amount outstanding of approximately
$22 under a U.S. dollar-based term loan of a Canadian subsidiary. As a result of these debt extinguishments, the Company recorded
a $12.8 loss on the extinguishment of debt, which is primarily comprised of a non-cash charge due to the write-off of deferred debt
issuance costs relating to the prior senior secured credit facility.
The weighted average interest rate on the Facility was approximately 3% at December 31, 2011.
Senior Notes and Senior Subordinated Notes
The Company may redeem all or part of the 8% senior notes due 2016 and the 7 1/2% senior subordinated notes due 2020
beginning in May 2013 and January 2015, respectively, at specified redemption prices ranging from approximately 100% to 104% of
the principal amount, plus accrued and unpaid interest to the date of redemption. Beginning in November 2015, the Company may
redeem all or part of these 6 1/8% senior notes due 2022 at specified redemption prices ranging from approximately 100% to 103%
of the principal amount, plus accrued and unpaid interest to the date of redemption.
The 2% subordinated note due 2012 (the “Note”) is not prepayable at the Company’s option. The holder of the Note has the option
to require redemption of the Note if the closing price of Jarden’s common stock exceeds $45.32 (subject to adjustment as provided
therein) per share for a period of three consecutive trading days.
The Company has designated a portion of its Euro-denominated 7 1/2% senior subordinated notes due 2020, with an aggregate
principal balance of = C150 (the “Hedging Instrument”), as a net investment hedge of the foreign currency exposure of its net
investment in certain Euro-denominated subsidiaries. Foreign currency gains and losses on the Hedging Instrument are recorded as
an adjustment to AOCI. See Note 10 for disclosures regarding the Company’s derivative financial instruments.
Securitization Facility
The Company maintains a receivables purchase agreement (the “Securitization Facility”) that bears interest at a margin over the
commercial paper rate. Under the Securitization Facility, substantially all of the Company’s Outdoor Solutions, Consumer Solutions
and Branded Consumables domestic accounts receivable are sold to a special purpose entity, Jarden Receivables, LLC (“JRLLC”),
which is a wholly-owned consolidated subsidiary of the Company. JRLLC funds these purchases with borrowings under a loan
agreement, which are secured by the accounts receivable. There is no recourse to the Company for the unpaid portion of any loans
under this loan agreement. To the extent there is availability, the Securitization Facility will be drawn upon and repaid as needed to
fund general corporate purposes. At December 31, 2011, the borrowing rate margin and the unused line fee on the securitization
were 1.25% and 0.625% per annum, respectively.
In February 2012, the Company entered into an amendment to the Securitization Facility that, in part, increased maximum
borrowings from $300 to $400 and extended the term from May 2014 until February 2015. Following the renewal, the borrowing rate
margin is 0.90% and the unused line fee is 0.45% per annum.
Non-U.S. Borrowings
As of December 31, 2011 and 2010, non-U.S. borrowings consisted of the foreign senior debt of none and $26.5, respectively; and
amounts borrowed under various foreign credit lines and facilities totaling $35.6 and $35.5, respectively. Certain of these foreign
credit lines are secured by certain non-U.S. subsidiaries’ inventory and/or accounts receivable.
Debt Covenants and Other
The Senior Notes and Senior Subordinated Notes are subject to a number of restrictive covenants that, in part, limit the ability of
the Company and certain of its subsidiaries, subject to certain exceptions and qualifications, to incur additional indebtedness, to
incur liens, engage in mergers and consolidations, enter into transactions with affiliates, make certain investments, transfer or sell
assets, pay dividends to third parties or distributions on or repurchase the Company’s common stock, prepay debt subordinate to
the Senior Notes or dispose of assets.
The Facility and contains certain restrictions, subject to certain exceptions and qualifications, on the conduct of the Company and
certain of its subsidiaries, including, among other restrictions: incurring debt, disposing of certain assets, making investments,
exceeding certain agreed upon capital expenditures, creating or suffering liens, completing certain mergers, consolidations and
sales of assets, acquisitions, declaring dividends to third parties, redeeming or prepaying other debt, and certain transactions with
affiliates. The Facility and the Foreign Debt also include financial covenants that require the Company to maintain certain total
leverage and interest coverage ratios.