Debt and Credit Facilities

At June 30, 2014 and September 30, 2013, we had the following borrowing obligations (dollars in thousands):



	June 30, 2014		September 30, 2013
5.375% Senior Notes due 2020, net of unamortized premium of $4.8 million and $5.4 million, respectively. Effective interest rate 5.28%.	$	1,054,797	$	1,055,385
2.75% Convertible Debentures due 2031, net of unamortized discount of $95.1 million and $113.5 million, respectively. Effective interest rate 7.43%.	594,878		576,524
2.75% Convertible Debentures due 2027, net of unamortized discount of $1.3 million and $8.8 million, respectively. Effective interest rate 7.30%.	248,713		241,206
Credit Facility, net of unamortized original issue discount of $1.0 million and $1.2 million respectively.	477,567		481,016
Total long-term debt	$	2,375,955	$	2,354,131
Less: current portion	253,547		246,040
Non-current portion of long-term debt	$	2,122,408	$	2,108,091

2.75% Convertible Debentures due 2031

As of June 30, 2014 and September 30, 2013, none of the conversion criteria were met for the 2031 Debentures. If the conversion criteria were met, we could be required to repay all or some of the principal amount in cash prior to maturity.

2.75% Convertible Debentures due 2027

The 2027 Debentures may be redeemed at the holders option in August 2014. As a result, we have classified the obligation in current liabilities at June 30, 2014 and September 30, 2013.

On August 11, 2014, we issued a notice of redemption to the holders of the 2027 Debentures indicating that we are calling the outstanding debentures on or about September 24, 2014. Upon redemption, the holders of the debentures will receive cash equal to $1,000 per $1,000 principal amount, together with any accrued and unpaid interest on the Debentures being redeemed. As a result of the announced redemption, the Debentures are becoming convertible in accordance with their terms.

Credit Facility

The Credit Facility includes a term loan and a $75 million revolving credit line, including letters of credit. The term loan matures on August 7, 2019 and the revolving credit line matures on August 7, 2018. As of June 30, 2014, there were $5.7 million of letters of credit issued, and there were no other outstanding borrowings under the revolving credit line.

Under terms of the amended and restated credit agreement, interest is payable monthly at a rate equal to the applicable margin plus, at our option, either (a) the base rate which is the corporate base rate of Morgan Stanley, the Administrative Agent, or (b) LIBOR (equal to (i) the British Bankers’ Association Interest Settlement Rates for deposits in U.S. dollars divided by (ii) one minus the statutory reserves applicable to such borrowing). The applicable margin for the borrowings at June 30, 2014 is as follows:



Description	Base Rate Margin	LIBOR Margin
Term loans maturing August 2019	1.75%	2.75%
Revolving facility due August 2018	0.50% - 0.75% (a)	1.50% - 1.75% (a)


(a)	The margin is determined based on our net leverage ratio at the date the interest rates are reset on the revolving credit line.

At June 30, 2014, the applicable margin for the term loans was 2.75%, with an effective rate of 2.90%, on the outstanding balance of $478.6 million maturing in August 2019. We are required to pay a commitment fee for unutilized commitments under the revolving credit facility at a rate ranging from 0.250% to 0.375% per annum, based upon our net leverage ratio. As of June 30, 2014, the commitment fee rate was 0.375%.

The Credit Facility contains the most restrictive covenants of our long-term debt, including, among other things, covenants that restrict our ability and those of our subsidiaries to incur certain additional indebtedness or issue guarantees, create or permit liens on assets, enter into sale-leaseback transactions, make loans or investments, sell assets, make certain acquisitions, pay dividends, repurchase stock, or merge or consolidate with any entity, and enter into certain transactions with affiliates. The agreement also contains events of default, including failure to make payments of principal or interest, failure to observe covenants, breaches of representations and warranties, defaults under certain other material indebtedness, failure to satisfy material judgments, a change of control and certain insolvency events. As of June 30, 2014, we were in compliance with the covenants under the Credit Facility. The covenants on our other long-term debt are less restrictive, and as of June 30, 2014, we were in compliance with the requirements of our other long-term debt.

Our obligations under the Credit Facility are unconditionally guaranteed by, subject to certain exceptions, each of our existing and future direct and indirect wholly-owned domestic subsidiaries. The Credit Facility and the guarantees thereof are secured by first priority liens and security interests in the following: 100% of the capital stock of substantially all of our domestic subsidiaries and 65% of the outstanding voting equity interests and 100% of the non-voting equity interests of first-tier foreign subsidiaries, all our material tangible and intangible assets and those of the guarantors, and any present and future intercompany debt. The Credit Facility also contains provisions for mandatory prepayments of outstanding term loans upon receipt of the following, and subject to certain exceptions: 100% of net cash proceeds from asset sales, 100% of net cash proceeds from issuance or incurrence of debt, and 100% of extraordinary receipts. We may voluntarily prepay borrowings under the Credit Facility without premium or penalty other than breakage costs, as defined with respect to LIBOR-based loans.

The Credit Facility includes a provision for an annual excess cash flow sweep, as defined in the agreement, payable in the first quarter of each fiscal year, based on the excess cash flow generated in the previous fiscal year. No excess cash flow sweep was required in the first quarter of fiscal 2014 as no excess cash flow, as defined in the agreement was generated in fiscal 2013. At the current time, we are unable to predict the amount of the outstanding principal, if any, that we may be required to repay in future fiscal years pursuant to the excess cash flow sweep provisions.