LONG-TERM DEBT



		At March 31, 2016														At September 30, 2015
		Outstanding Balance			Original Issuer Discount			Capitalized Fees & Expenses			Balance Sheet			Coupon Interest Rate (1)		Outstanding Balance			Original Issuer Discount			Capitalized Fees & Expenses			Balance Sheet			Coupon Interest Rate (1)
Senior notes due 2022	(a)	$	600,000		$	—		$	(7,620	)	$	592,380		5.25	%	$	600,000		$	—		$	(8,264	)	$	591,736		5.25	%
Revolver due 2021	(b)	122,500			—			(2,699		)	119,801			n/a		35,000			—			(2,049		)	32,951			n/a
Convert. debt due 2017	(c)	100,000			(3,468		)	(369		)	96,163			4.00	%	100,000			(5,594		)	(571		)	93,835			4.00	%
Real estate mortgages	(d)	39,204			—			(648		)	38,556			n/a		32,280			—			(470		)	31,810			n/a
ESOP Loans	(e)	35,643			—			(189		)	35,454			n/a		36,744			—			(224		)	36,520			n/a
Capital lease - real estate	(f)	6,993			—			(143		)	6,850			5.00	%	7,524			—			(156		)	7,368			5.00	%
Non U.S. lines of credit	(g)	11,465			—			(9		)	11,456			n/a		8,934			—			(3		)	8,931			n/a
Non U.S. term loans	(g)	37,681			—			(243		)	37,438			n/a		39,142			—			(299		)	38,843			n/a
Other long term debt	(h)	3,706			—			(24		)	3,682			n/a		1,575			—			—			1,575			n/a
Totals		957,192			(3,468		)	(11,944		)	941,780					861,199			(5,594		)	(12,036		)	843,569
less: Current portion		(19,217		)	—			—			(19,217		)			(16,593		)	—			—			(16,593		)
Long-term debt		$	937,975		$	(3,468	)	$	(11,944	)	$	922,563				$	844,606		$	(5,594	)	$	(12,036	)	$	826,976



		Three Months Ended March 31, 2016												Three Months Ended March 31, 2015
		Effective Interest Rate (1)		Cash Interest			Amort. Debt Discount		Amort. Debt Issuance Costs & Other Fees		Total Interest Expense			Effective Interest Rate (1)		Cash Interest			Amort. Debt Discount		Amort. Debt Issuance Costs & Other Fees		Total Interest Expense
Senior notes due 2022	(a)	5.5	%	7,875			—		323		8,198			5.5%		7,875			—		322		8,197
Revolver due 2021	(b)	n/a		954			—		122		1,076			n/a		659			—		133		792
Convert. debt due 2017	(c)	9.2	%	1,000			1,079		111		2,190			9.1	%	1,000			990		110		2,100
Real estate mortgages	(d)	2.2	%	154			—		17		171			3.8	%	116			—		36		152
ESOP Loans	(e)	3.3	%	275			—		17		292			2.9	%	254			—		18		272
Capital lease - real estate	(f)	5.4	%	90			—		7		97			5.3	%	102			—		6		108
Non U.S. lines of credit	(g)	n/a		97			—		22		119			n/a		109			—		—		109
Non U.S. term loans	(g)	n/a		272			—		13		285			n/a		337			—		14		351
Other long term debt	(h)	n/a		79			—		—		79			n/a		22			—		2		24
Capitalized interest				(118		)	—		3		(115		)			(93		)	—		—		(93		)
Totals				$	10,678		$	1,079	$	635	$	12,392				$	10,381		$	990	$	641	$	12,012

(1) n/a = not applicable



		Six Months Ended March 31, 2016												Six Months Ended March 31, 2015
		Effective Interest Rate (1)		Cash Interest			Amort. Debt Discount		Amort. Debt Issuance Costs & Other Fees		Total Interest Expense			Effective Interest Rate (1)		Cash Interest			Amort. Debt Discount		Amort. Debt Issuance Costs & Other Fees		Total Interest Expense
Senior notes due 2022	(a)	5.5	%	15,750			—		645		16,395			5.5	%	15,750			—		644		16,394
Revolver due 2021	(b)	n/a		1,525			—		237		1,762			n/a		997			—		291		1,288
Convert. debt due 2017	(c)	9.0	%	2,000			2,127		222		4,349			9.2	%	2,000			1,952		221		4,173
Real estate mortgages	(d)	2.1	%	305			—		29		334			3.8	%	240			—		72		312
ESOP Loans	(e)	3.1	%	531			—		35		566			2.9	%	514			—		35		549
Capital lease - real estate	(f)	5.4	%	183			—		13		196			5.3	%	208			—		12		220
Non U.S. lines of credit	(g)	n/a		356			—		46		402			n/a		250			—		—		250
Non U.S. term loans	(g)	n/a		556			—		26		582			n/a		725			—		30		755
Other long term debt	(h)	n/a		98			—		—		98			n/a		53			—		8		61
Capitalized interest				(274		)	—		5		(269		)			(236		)	—		—		(236		)
Totals				$	21,030		$	2,127	$	1,258	$	24,415				$	20,501		$	1,952	$	1,313	$	23,766

On February 27, 2014, in an unregistered offering through a private placement under Rule 144A, Griffon issued, at par, $600,000 of 5.25% Senior Notes due 2022 (“Senior Notes”); interest is payable semi-annually on March 1 and September 1. Proceeds from the Senior Notes were used to redeem $550,000 of 7.125% senior notes due 2018, to pay a call and tender offer premium of $31,530 and to make interest payments of $16,716, with the balance used to pay a portion of the related transaction fees and expenses. In connection with the issuance of the Senior Notes, all obligations under the $550,000 of 7.125% senior notes due 2018 were discharged.

The Senior Notes are senior unsecured obligations of Griffon guaranteed by certain domestic subsidiaries, and subject to certain covenants, limitations and restrictions. On June 18, 2014, Griffon exchanged all of the Senior Notes for substantially identical Senior Notes registered under the Securities Act of 1933 via an exchange offer. The fair value of the Senior Notes approximated $588,000 on March 31, 2016 based upon quoted market prices (level 1 inputs).

In connection with these transactions, Griffon capitalized $10,313 of underwriting fees and other expenses incurred related to the issuance and exchange of the Senior Notes, which will amortize over the term of such notes. Griffon recognized a loss on the early extinguishment of debt on the 7.125% senior notes aggregating $38,890, comprised of the $31,530 tender offer premium, the write-off of $6,574 of remaining deferred financing fees and $786 of prepaid interest on defeased notes.

(b)

On March 22, 2016, Griffon amended its Revolving Credit Facility (the “Credit Agreement”) to increase the maximum borrowing availability from $250,000 to $350,000, extend its maturity date from March 13, 2020 to March 22, 2021 and modify certain other provisions of the facility. The facility includes a letter of credit sub-facility with a limit of $50,000 and a multi-currency sub-facility of $50,000. The Credit Agreement provides for same day borrowings of base rate loans in lieu of a swing line sub-facility. Borrowings under the Credit Agreement may be repaid and re-borrowed at any time, subject to final maturity of the facility or the occurrence or event of default under the Credit Agreement. Interest is payable on borrowings at either a LIBOR or base rate benchmark rate, in each case without a floor, plus an applicable margin, which adjusts based on financial performance. Current margins are 1.25% for base rate loans and 2.25% for LIBOR loans. The Credit Agreement has certain financial maintenance tests including a maximum total leverage ratio, a maximum senior secured leverage ratio and a minimum interest coverage ratio, as well as customary affirmative and negative covenants, and events of default. The negative covenants place limits on Griffon's ability to, among other things, incur indebtedness, incur liens, and make restricted payments and investments. Borrowings under the Credit Agreement are guaranteed by Griffon’s material domestic subsidiaries and are secured, on a first priority basis, by substantially all domestic assets of the Company and the guarantors, and a pledge of not greater than 65% of the equity interest in Griffon’s material, first-tier foreign subsidiaries (except that a lien on the assets of Griffon's material domestic subsidiaries securing a limited amount of the debt under the credit agreement relating to Griffon's Employee Stock Ownership Plan ("ESOP") ranks pari passu with the lien granted on such assets under the Credit Agreement; see footnote (e) below). At March 31, 2016, outstanding borrowings and standby letters of credit were $122,500 and $15,922, respectively, under the Credit Agreement; $211,578 was available, subject to certain loan covenants, for borrowing at that date.

(c)

On December 21, 2009, Griffon issued $100,000 principal of 4% convertible subordinated notes due 2017 (the “2017 Notes”). The current conversion rate of the 2017 Notes is 70.1631 shares of Griffon’s common stock per $1 principal amount of notes, corresponding to a conversion price of $14.25 per share. Prior to July 15, 2016, if for at least 20 trading days out of the last 30 trading days during any fiscal quarter the closing price of Griffon's common stock is 130% or greater than the conversion price on each such trading day, then at any time during the immediately subsequent fiscal quarter any holder has the option to convert such holder's note (and the Company is required to notify the trustee under the notes, and the holders of the notes, that this condition to conversion has been met). At any time on or after July 15, 2016, any holder has the option to convert such holder's notes; Griffon has the right to settle the conversion of the 2017 Notes in cash, stock or a combination of cash and stock. Griffon has the intent and ability to settle the principal components of any conversion of notes in cash. When a cash dividend is declared that would result in an adjustment to the conversion ratio of less than 1%, any adjustment to the conversion ratio is deferred until the first to occur of (i) actual conversion; (ii) the 42nd trading day prior to maturity of the notes; and (iii) such time as the cumulative adjustment equals or exceeds 1%. At both March 31, 2016 and 2015, the 2017 Notes had a capital in excess of par component, net of tax, of $15,720. The fair value of the 2017 Notes approximated $115,375 on March 31, 2016 based upon quoted market prices (level 1 inputs). These notes are classified as long term debt as Griffon has the intent and ability to refinance the principal amount of the notes, including with borrowings under the Credit Agreement.

(d)

In September 2015 and March 2016, Griffon entered into mortgage loans in the amounts of $32,280 and $8,000, respectively. The mortgage loans are secured by four properties occupied by Griffon's subsidiaries. The loans mature in September 2025 and April 2018, respectively, are collateralized by the specific properties financed and are guaranteed by Griffon. The loans bear interest at a rate of LIBOR plus 1.50%. At March 31, 2016, $38,556 was outstanding, net of issuance costs.

(e)

In December 2013, Griffon’s ESOP entered into an agreement that refinanced the two existing ESOP loans into one new Term Loan in the amount of $21,098 (the "Agreement"). The Agreement also provided for a Line Note with $10,000 available to purchase shares of Griffon common stock in the open market. In July 2014, Griffon's ESOP entered into an amendment to the existing Agreement which provided an additional $10,000 Line Note available to purchase shares in the open market. During 2014, the Line Notes were combined with the Term Loan to form one new Term Loan. The Term Loan bears interest at LIBOR plus 2.38% or the lender’s prime rate, at Griffon’s option. The Term Loan requires quarterly principal payments of $551, with a balloon payment of approximately $30,137 due at maturity on December 31, 2018. During 2014, 1,591,117 shares of Griffon common stock, for a total of $20,000 or $12.57 per share, were purchased with proceeds from the Line Notes. As of March 31, 2016, $35,454, net of issuance costs, was outstanding under the Term Loan. The Term Loan is secured by shares purchased with the proceeds of the loan and with a lien on a specific amount of Griffon assets (which lien ranks pari passu with the lien granted on such assets under the Credit Agreement) and is guaranteed by Griffon.


(f)	In October 2006, CBP entered into a capital lease totaling $14,290 for real estate in Troy, Ohio. The lease matures in 2022, bears interest at a fixed rate of 5.0%, is secured by a mortgage on the real estate and is guaranteed by Griffon. At March 31, 2016, $6,850 was outstanding, net of issuance costs.

(g)

In September 2015, Clopay Europe GmbH (“Clopay Europe”) entered into a EUR 5,000 ($5,678 as of March 31, 2016) revolving credit facility and EUR 15,000 term loan. The term loan is payable in twelve quarterly installments of EUR 1,250, bears interest at a fixed rate of 2.5% and matures in September 2018. The revolving facility matures in September 2016, but is renewable upon mutual agreement with the bank. The revolving credit facility accrues interest at EURIBOR plus 1.75% per annum (1.75% at March 31, 2016). The revolver and the term loan are both secured by substantially all of the assets of Clopay Europe and its subsidiaries. Griffon guarantees the revolving facility and term loan. The term loan has an outstanding balance of EUR 12,500 ($14,006 at March 31, 2016, net of issuance costs) and the revolver had no borrowings outstanding at March 31, 2016. Clopay Europe is required to maintain a certain minimum equity to assets ratio and is subject to a maximum debt leverage ratio (defined as the ratio of total debt to EBITDA).

Clopay do Brazil maintains lines of credit of R$12,800 ($3,597 as of March 31, 2016). Interest on borrowings accrues at a rate of Brazilian CDI plus 6.0% (20.13% at March 31, 2016). At March 31, 2016 there was approximately R$6,911($1,942 as of March 31, 2016) borrowed under the lines. PPC guarantees the loan and lines.

In November 2012, Garant G.P. (“Garant”) entered into a CAD $15,000 ($11,567 as of March 31, 2016) revolving credit facility. The facility accrues interest at LIBOR (USD) or the Bankers Acceptance Rate (CDN) plus 1.3% per annum (1.93% LIBOR USD and 2.16% Bankers Acceptance Rate CDN as of March 31, 2016). The revolving facility matures in October 2016. This facility is classified as long term debt as Griffon has the intent and ability to refinance the borrowings. Garant is required to maintain a certain minimum equity. At March 31, 2016, there was CAD $8,371 ($6,455 as of March 31, 2016) borrowed under the revolving credit facility with CAD $6,629 ($5,112 as of March 31, 2016) available for borrowing.

In December 2013 and May 2014, Griffon Australia Holdings Pty Ltd (formerly known as Northcote Holdings Australia Pty Ltd) entered into two unsecured term loans in the outstanding amounts of AUD 12,500 and AUD 20,000, respectively. The AUD 12,500 term loan requires quarterly interest payments with principal due upon maturity in December 2016. This loan is classified as long term debt as Griffon has the intent and ability to refinance the principal amount. The AUD 20,000 term loan requires quarterly principal payments of AUD 625, with a balloon payment due upon maturity in May 2017. The loans accrue interest at Bank Bill Swap Bid Rate “BBSY” plus 2.8% per annum (5.09% at March 31, 2016 for each loan). As of March 31, 2016, Griffon had an outstanding combined balance of AUD $30,555 ($23,432 as of March 31, 2016) on the term loans, net of issuance costs.

A subsidiary of Northcote Holdings Pty Ltd also maintains a line of credit of AUD 5,000 ($3,835 as of March 31, 2016), which accrues interest at BBSY plus 2.50% per annum (4.79% at March 31, 2016). At March 31, 2016, there were AUD 4,000 ($3,068 as of March 31, 2016) under the lines. The assets of a subsidiary of Northcote Holdings Pty Ltd secures the AUD 5,000 line of credit.


(h)	Other long-term debt primarily consists of a loan with the Pennsylvania Industrial Development Authority with the balance consisting of capital leases.

At March 31, 2016, Griffon and its subsidiaries were in compliance with the terms and covenants of all credit and loan agreements.