Legal proceedings/contingencies and other obligations

6 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Legal proceedings/contingencies and other obligations

Legal proceedings/contingencies and other obligations

Legal proceedings/contingencies - The Company and its affiliates are subject to a number of legal proceedings in various jurisdictions arising out of its operations. Many of these legal matters are in preliminary stages and involve complex issues of law and fact, and may proceed for protracted periods of time. The amount of liability, if any, from these proceedings cannot be determined with certainty. We are a party to legal proceedings and claims that arise during the ordinary course of business. We review our legal proceedings and claims, regulatory reviews and inspections and other legal proceedings on an ongoing basis and follow appropriate accounting guidance when making accrual and disclosure decisions. We establish accruals for those contingencies where the incurrence of a loss is probable and can be reasonably estimated, and we disclose the amount accrued and the amount of a reasonably possible loss in excess of the amount accrued, if such disclosure is necessary for our financial statements to not be misleading. We do not record liabilities when the likelihood that the liability has been incurred is probable, but the amount cannot be reasonably estimated. Based upon present information, the Company believes that its liability, if any, arising from such pending legal proceedings, asserted legal claims and known potential legal claims which are likely to be asserted, is not reasonably likely to be material to the Company's financial position, results of operations, or cash flows, when taking into account established accruals for estimated liabilities.

In December 2018, the Secretaria Executiva de Meio Ambiente e Gestão Urbana (“SEMAG”) alleged that, during July and August 2018, chemical levels in Spectrum’s wastewater discharge at its facility located in Recife, Brazil exceeded regulatory limits.  The agency proposed a penalty of 2 million reals (approximately $0.5), and Spectrum filed its defense with SEMAG against the imposition of the penalty in January 2019.  In April 2019, the Company received two notices from SEMAG, a re-issuance of the penalty for the alleged violations occurring in July and August 2018 and a notice for alleged wastewater discharge exceedances occurring in October and November 2018.  The agency proposed a penalty of 2.2 million reals (approximately $0.6), and the Company will be filing its defense with the agency against the imposition of this penalty.  Both alleged wastewater exceedances occurred prior to the Battery Acquisition.  Under the terms of the acquisition agreement between the Company and Spectrum, subject to certain deductibles and caps, Spectrum is required to indemnify the Company for certain environmental liabilities, including those arising out of the facility located in Recife, Brazil.

Other obligations - In the ordinary course of business, the Company also enters into supply and service contracts. These contracts can include either volume commitments or fixed expiration dates, termination provisions and other standard contractual considerations. At March 31, 2019, the Company had approximately $41.1 of purchase obligations.