FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

Recurring Fair Value Measurements

The following table presents the fair value for those assets and (liabilities) measured on a recurring basis as of July 31, 2016 and October 31, 2015 (Dollars in millions):



	July 31, 2016
	Fair Value Measurement
	Level 1		Level 2			Level 3		Total			Balance Sheet Location
Foreign exchange hedges	$	—	$	0.5		$	—	$	0.5		Prepaid expenses and other current assets
Foreign exchange hedges	—		(0.1		)	—		(0.1		)	Other current liabilities
Insurance annuity	—		—			20.1		20.1			Other long-term assets
Total*	$	—	$	0.4		$	20.1	$	20.5



	October 31, 2015
	Fair Value Measurement
	Level 1		Level 2			Level 3		Total			Balance Sheet Location
Foreign exchange hedges	$	—	$	0.3		$	—	$	0.3		Prepaid expenses and other current assets
Foreign exchange hedges	—		(0.2		)	—		(0.2		)	Other current liabilities
Insurance annuity	—		—			20.1		20.1			Other long-term assets
Total*	$	—	$	0.1		$	20.1	$	20.2


*	The carrying amounts of cash and cash equivalents, trade accounts receivable, accounts payable, current liabilities and short-term borrowings as of July 31, 2016 and October 31, 2015 approximate their fair values because of the short-term nature of these items and are not included in this table.

Foreign Exchange Hedges

The Company conducts business in various international currencies and is subject to risks associated with changing foreign exchange rates. The Company’s objective is to reduce volatility associated with foreign exchange rate changes. Accordingly, from time to time, the Company enters into various contracts that change in value as foreign exchange rates change to protect the value of certain existing foreign currency assets and liabilities, commitments and anticipated foreign currency cash flows.

As of July 31, 2016, the Company had outstanding foreign currency forward contracts in the notional amount of $85.1 million ($129.9 million as of October 31, 2015). Adjustments to fair value are recognized in earnings, offsetting the impact of the hedged item. The assumptions used in measuring fair value of foreign exchange hedges are considered level 2 inputs, which were based on observable market pricing for similar instruments, principally foreign exchange futures contracts. Gains recorded under fair value contracts were $0.6 million for the three months ended July 31, 2015 . Losses recorded under fair value contracts were $2.0 million for the three months ended July 31, 2016; and were $2.3 million and $6.2 million for the nine months ended July 31, 2016 and 2015, respectively.

Other financial instruments

The fair values of the Company’s Amended Credit Agreement and the Amended Receivables Facility do not materially differ from carrying value as the Company’s cost of borrowing is variable and approximates current borrowing rates. The book value of the net assets and liabilities held by special purpose entities approximate their fair value. The fair values of the Company’s long-term obligations are estimated based on either the quoted market prices for the same or similar issues or the current interest rates offered for the debt of the same remaining maturities, which are considered level 2 inputs in accordance with ASC Topic 820, Fair Value Measurements and Disclosures.

The following table presents the estimated fair values of the Company’s senior notes (Dollars in millions):



	July 31, 2016		October 31, 2015
Senior Notes due 2017
Estimated fair value	$	307.2	$	314.8
Senior Notes due 2019
Estimated fair value	282.5		280.6
Senior Notes due 2021
Estimated fair value	266.9		258.7

Non-Recurring Fair Value Measurements

Long-Lived Assets

The Company recognized asset impairment charges of $4.1 million during the three months ended July 31, 2016 and $17.6 million for the three months ended July 31, 2015. As a result of the Company measuring long-lived assets at fair value on a non-recurring basis, during the three months ended July 31, 2016, the Company recorded impairment charges of $1.3 million related to properties, plants and equipment, net, in the Rigid Industrial Packaging & Services segment. The Company recognized asset impairment charges of $44.9 million and $22.3 million during the nine months ended July 31, 2016 and 2015, respectively. As a result of the Company measuring long-lived assets at fair value on a non-recurring basis, during the nine months ended July 31, 2016, the Company recorded impairment charges of $5.0 million related to properties, plants and equipment, net, in the Rigid Industrial Packaging & Services segment, $1.5 million related to a cost method investment in the Paper Packaging & Services segment, and $0.8 million of properties, plants and equipment, net, in the Flexible Products & Services segment.

The assumptions used in measuring fair value of long-lived assets are considered level 3 inputs, which include bids received from third parties, recent purchase offers, market comparable information and discounted cash flows based on assumptions that market participants would use.

Assets and Liabilities Held for Sale

The assumptions used in measuring fair value of assets and liabilities held for sale are considered level 3 inputs, which include recent purchase offers, market comparables and/or data obtained from commercial real estate brokers. During the nine month period ended July 31, 2016, three asset groups were reclassified to assets and liabilities held for sale, resulting in a $23.6 million impairment to net realizable value. Included in that asset impairment, was $9.1 million of goodwill allocated to the business classified as held for sale. During the nine month period ended July 31, 2016, one asset group classified as held for sale as of October 31, 2015, was remeasured to net realizable value, resulting in an impairment of $14.0 million. Included in that asset impairment, was $11.9 million of goodwill allocated to the business classified as held for sale. During the three months ended July 31, 2016, one asset group was reclassified to assets and liabilities held for sale, resulting in a $2.8 million impairment to net realizable value.

The following table presents quantitative information about the significant unobservable inputs used to determine the fair value of the impairment of long-lived assets held and used and net assets held for sale for the nine months ended July 31, 2016.



	Quantitative Information about Level 3 Fair Value Measurements
	Fair Value of Impairment		Valuation Technique	Unobservable Input	Range of Input Values
	(in millions)
July 31, 2016
Impairment of Net Assets Held for Sale	$	37.6	Broker Quote/ Indicative Bids	Indicative Bids	N/A
Impairment of Long Lived Assets	$	7.3	Sales Value	Sales Value	N/A
July 31, 2015
Impairment of Long Lived Assets - Land & Building	$	17.7	Broker Quote/ Indicative Bids	Indicative Bids	N/A
Impairment of Long Lived Assets - Machinery & Equipment	$	3.0	Sales Value	Sales Value	N/A

Goodwill and Other Intangible Assets

On an annual basis or whenever events or circumstances indicate impairment may have occurred, the Company performs impairment tests for goodwill and long lived intangible assets as defined under ASC 350, “Intangibles-Goodwill and Other.” The Company concluded that no such impairment existed as of July 31, 2016 and October 31, 2015.