Sunbeam 2014 Annual Report Download - page 53

Jarden Corporation Annual Report 2014 51
• if the Company calls any 2034 Convertible Notes for redemption; or
• on or after December15, 2033, and on or prior to the close of business on the second scheduled trading day immediately
preceding the maturity date, without regard to the foregoing conditions.
Upon conversion, holders will receive, at the Company’s discretion, cash, shares of the Company’s common stock or a combination
thereof. It is the Company’s intent to settle the principal amount and accrued interest on the 2034 Convertible Notes with cash. At the
date of issuance, the estimated fair values of the liability and equity components of the 2034 Convertible Notes were approximately
$471 and $219, respectively, resulting in an effective annual interest rate, considering debt issuance costs, of approximately 5.5%.
The amount allocated to the equity component is recorded as a discount to the original aggregate principal amount of the 2034
Convertible Notes.
The Company’s 11⁄2% senior subordinated convertible notes due 2019 (the “2019 Convertible Notes”), which have an aggregate
principal balance of $265, have a conversion rate of approximately 25.7 shares of the Company’s common stock (subject to customary
adjustments, including in connection with a fundamental change transaction) per $1 thousand principal amount, which is equivalent
to a conversion price of approximately $38.97 per share. The 2019 Convertible Notes are not subject to redemption at the Company’s
option prior to the maturity date. Prior to March1, 2019, the 2019 Convertible Notes will be convertible only upon the occurrence of
certain events and during certain periods, and thereafter, at any time until the second scheduled trading day immediately preceding
the maturity date. If the Company undergoes a fundamental change (as dened in the indenture governing these convertible notes)
prior to maturity, holders of the 2019 Convertible Notes will have the right, at their option, to require the Company to repurchase
for cash some or all of the 2019 Convertible Notes at a repurchase price equal to 100% of the principal amount being repurchased,
plus accrued and unpaid interest. Upon conversion, holders will receive, at the Company’s discretion, cash, shares of the Company’s
common stock or a combination thereof. It is the Company’s intent to settle the principal amount and accrued interest on the 2019
Convertible Notes with cash. The effective annual interest rate on the 2019 Convertible Notes, which is based upon the initial fair
valuation, is approximately 5.6%.
The Company’s 1 7/8% senior subordinated convertible notes due 2018 (the “2018 Convertible Notes”), which have an aggregate
principal balance of $500, have a conversion rate of approximately 31.8 shares of the Company’s common stock (subject to customary
adjustments, including in connection with a fundamental change transaction) per $1 thousand principal amount, which is equivalent to a
conversion price of approximately $31.49 per share. The 2018 Convertible Notes are not subject to redemption at the Company’s option
prior to the maturity date. Prior to June1, 2018, the 2018 Convertible Notes will be convertible only upon the occurrence of certain
events and during certain periods, and thereafter, at any time until the second scheduled trading day immediately preceding the
maturity date. If the Company undergoes a fundamental change (as dened in the indenture governing these convertible notes) prior
to maturity, holders of the 2018 Convertible Notes will have the right, at their option, to require the Company to repurchase for cash
some or all of the 2018 Convertible Notes at a repurchase price equal to 100% of the principal amount being repurchased, plus accrued
and unpaid interest. Upon conversion, holders will receive, at the Company’s discretion, cash, shares of the Company’s common
stock or a combination thereof. It is the Company’s intent to settle the principal amount and accrued interest on the 2018 Convertible
Notes with cash. The effective annual interest rate on the 2018 Convertible Notes, which is based upon the initial fair valuation, is
approximately 5.5%.
Securitization Facility
The Company maintains a $500 receivables purchase agreement (the “Securitization Facility”) that matures in October 2016 and
bears interest at a margin over the commercial paper rate. Under the Securitization Facility, substantially all of the Company’s Branded
Consumables, Consumer Solutions and Outdoor Solutions domestic accounts receivable are sold to a special purpose entity, Jarden
Receivables, LLC (“JRLLC”), which is a wholly-owned consolidated indirect 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, 2014, the borrowing rate margin and the unused line fee on
the securitization were 0.80% and 0.40%per annum, respectively.
Non-U.S. Borrowings
The Company’s non-U.S. borrowings are comprised of amounts borrowed under various foreign credit lines and facilities. 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 qualications, to incur additional indebtedness, to incur
liens, engage in mergers and consolidations, enter into transactions with afliates, 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.
Notes to Consolidated Financial Statements
Jarden Corporation Annual Report 2014 (Dollars in millions, except per share data and unless otherwise indicated)