LONG-TERM DEBT (Tables)

12 Months Ended

Sep. 30, 2022

Debt at September 30, 2022 and 2021 consisted of the following:


		At September 30, 2022
		Outstanding Balance		Original Issuer Premium (Discount)		Capitalized Fees & Expenses		Balance Sheet		Coupon Interest Rate
Senior Notes due 2028	(a)	$	974,775	$	266	$	(10,939)	$	964,102	5.75	%
Term Loan B due 2029	(b)	496,000		(1,144)		(8,823)		486,033		Variable
Revolver due 2025	(b)	97,328		—		(1,227)		96,101		Variable
Finance lease - real estate	(c)	13,091		—		—		13,091		Variable
Non U.S. lines of credit	(d)	—		—		(2)		(2)		Variable
Non U.S. term and mortgage loans	(d)	12,090		—		(27)		12,063		Variable
Other long term debt	(e)	2,276		—		(13)		2,263		Variable
Totals		1,595,560		(878)		(21,031)		1,573,651
less: Current portion		(12,653)		—		—		(12,653)
Long-term debt		$	1,582,907	$	(878)	$	(21,031)	$	1,560,998


		At September 30, 2021
		Outstanding Balance		Original Issuer Premium		Capitalized Fees & Expenses		Balance Sheet		Coupon Interest Rate
Senior notes due 2028	(a)	$	1,000,000	$	315	$	(13,293)	$	987,022	5.75	%
Revolver due 2025	(b)	13,483		—		(1,718)		11,765		Variable



Finance lease - real estate	(c)	14,594		—		(4)		14,590		Variable
Non U.S. lines of credit	(d)	3,012		—		(17)		2,995		Variable
Non U.S. term and mortgage loans	(d)	25,684		—		(91)		25,593		Variable
Other long term debt	(e)	3,733		—		(15)		3,718		Variable
Totals		1,060,506		315		(15,138)		1,045,683
less: Current portion		(12,486)		—		—		(12,486)
Long-term debt		$	1,048,020	$	315	$	(15,138)	$	1,033,197

Interest expense consists of the following for 2022, 2021 and 2020.


		Year Ended September 30, 2022
		Effective Interest Rate		Cash Interest		Amort. Debt (Premium) Discount		Amort. Deferred Cost & Other Fees		Total Interest Expense
Senior notes due 2028	(a)	5.95	%	$	57,105	$	(48)	$	2,056	$	59,113

Term Loan B due 2029	(b)	Variable		18,116		135		1,068		19,319
Revolver due 2025	(b)	Variable		3,762		—		491		4,253


Finance lease - real estate	(c)	5.60	%	759		—		4		763
Non U.S. lines of credit	(d)	Variable		17		—		15		32
Non U.S. term and mortgage loans	(d)	Variable		610		—		53		663
Other long term debt	(e)	Variable		544		—		1		545
Capitalized interest				(309)		—		—		(309)
Totals				$	80,604	$	87	$	3,688	$	84,379


		Year Ended September 30, 2021
		Effective Interest Rate		Cash Interest		Amort. Debt Premium		Amort. Deferred Cost & Other Fees		Total Interest Expense
Senior notes due 2028	(a)	5.95	%	$	57,500	$	(48)	$	2,084	$	59,536

Revolver due 2025	(b)	Variable		1,078		—		491		1,569



Finance lease - real estate	(c)	5.65	%	875		—		25		900
Non U.S. lines of credit	(d)	Variable		15		—		15		30
Non U.S. term and mortgage loans	(d)	Variable		655		—		71		726
Other long term debt	(e)	Variable		443		—		2		445
Capitalized interest				(31)		—		—		(31)
Totals				$	60,535	$	(48)	$	2,688	$	63,175


		Year Ended September 30, 2020
		Effective Interest Rate		Cash Interest		Amort. Debt Discount		Amort. Deferred Cost & Other Fees		Total Interest Expense
Senior notes due 2028	(a)	5.90	%	$	32,511	$	—	$	1,072	$	33,583
Senior notes due 2022	(a)	5.67	%	$	22,816	122		$	1,735	$	24,673
Revolver due 2025	(b)	Variable		5,866		—		635		6,501


Finance lease - real estate	(c)	4.45	%	386		—		25		411
Non U.S. lines of credit	(d)	Variable		12		—		15		27
Non U.S. term and mortgage loans	(d)	Variable		975		—		55		1,030
Other long term debt	(e)	Variable		445		—		2		447

Capitalized interest				(128)		—		—		(128)
Totals				$	62,883	$	122	$	3,539	$	66,544

Minimum payments under debt agreements for the next five years are as follows: $12,653 in 2023, $12,267 in 2024, $109,522 in 2025, $12,261 in 2026, $12,324 in 2027 and $1,436,533 thereafter.

(a)During 2020, Griffon issued, at par $1,000,000 of 5.75% Senior Notes due 2028 (the "2028 Senior Notes"). Proceeds from the 2028 Senior Notes were used to redeem the $1,000,000 of 5.25% Senior Notes due 2022 (the "2022 Senior Notes"). In connection with the issuance and exchange of the 2028 Senior Notes, Griffon capitalized $16,448 of underwriting fees and other expenses incurred, which will amortize over the term of such notes. Additionally, during 2020 Griffon recognized a $7,925 loss on the early extinguishment of debt of the 2022 Senior Notes, comprised primarily of the write-off of $6,725 of remaining deferred financing fees, $607 of tender offer net premium expense and $593 of redemption interest expense. Furthermore, all of the obligations associated with the 2022 Senior Notes were discharged.

During the year ended September 30, 2022, Griffon purchased $25,225 of 2028 Senior Notes in the open market at a weighted average discount of 91.82% of par, or $23,161. In connection with these purchases, Griffon recognized a $1,767 net gain on the early extinguishment of debt comprised of $2,064 of face value in excess of purchase price, offset by $297 related to the write-off of underwriting fees and other expenses. As of September 30, 2022, outstanding 2028 Senior Notes due totaled $974,775; interest is payable semi-annually on March 1 and September 1.

The 2028 Senior Notes are senior unsecured obligations of Griffon guaranteed by certain domestic subsidiaries, and subject to certain covenants, limitations and restrictions. The 2028 Senior Notes were registered under the Securities Act of 1933, as amended (the "Securities Act") via an exchange offer. The fair value of the 2028 Senior Notes approximated $833,433 on September 30, 2022 based upon quoted market prices (level 1 inputs). At September 30, 2022, $10,939 of underwriting fees and other expenses incurred remained to be amortized.

(b) On January 24, 2022, Griffon amended and restated its Revolving Credit Facility (as amended, "Credit Agreement") to provide for a new $800,000 Term Loan B facility, due January 24, 2029, in addition to its current $400,000 revolving credit facility ("Revolver"), and replaced LIBOR with SOFR (Secured Overnight Financing Rate). The Term Loan B contains a SOFR floor of 0.50% and a current spread of 2.50%. Additionally, there are two interest rate step-downs tied to achieving decreased secured leverage ratio thresholds, the first of which was achieved during the year ended September 30, 2022. The Original Issue Discount for the Term Loan B was 99.75%. In connection with this amendment, Griffon capitalized $15,466 of underwriting fees and other expenses incurred, which are being amortized over the term of the loan.

The Term Loan B facility requires nominal quarterly principal payments of $2,000, which began with the quarter ended June 30, 2022; potential additional annual principal payments based on a percentage of excess cash flow and certain secured leverage thresholds starting with the fiscal year ending September 30, 2023; and a final balloon payment due at maturity. Term Loan B borrowings may generally be repaid without penalty but may not be re-borrowed. During the year ended September 30, 2022, Griffon prepaid $300,000 aggregate principal amount of the Term Loan B, which permanently reduced the outstanding balance. In connection with the prepayment of the Term Loan B Griffon recognized a $6,296 charge on the prepayment of debt, $5,575 related to the write-off of underwriting fees and other expenses and $721 of the

original issue discount. The Term Loan B facility is subject to the same affirmative and negative covenants that apply to the Revolver, but is not subject to any financial maintenance covenants. Term Loan B borrowings are secured by the same collateral as the Revolver. The fair value of the Term Loan B facility approximated $476,160 on September 30, 2022 based upon quoted market prices (level 1 inputs). At September 30, 2022, $8,823 of underwriting fees and other expenses incurred, remained to be amortized.

The Revolver's maximum borrowing availability is $400,000 and it matures on March 22, 2025. The Revolver includes a letter of credit sub-facility with a limit of $100,000; a multi-currency sub-facility of $200,000; and contains a customary accordion feature that permits us to request, subject to each lender's consent, an increase in the maximum aggregate amount that can be borrowed by up to an additional $100,000.

In addition, on December 9, 2021, Griffon replaced the Revolver GBP LIBOR benchmark rate with a Sterling Overnight Index Average ("SONIA"). Borrowings under the Revolver may be repaid and re-borrowed at any time. Interest is payable on borrowings at either a SOFR, SONIA or base rate benchmark rate, plus an applicable margin, which adjusts based on financial performance. Current margins are 0.50% for base rate loans, 1.50% for SOFR loans and 1.50% for SONIA loans. The Revolver 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. Both the Revolver and Term Loan B 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. At September 30, 2022, under the Credit Agreement, there were $97,328 in outstanding borrowings; outstanding standby letters of credit were $12,287; and $290,385 was available, subject to certain loan covenants, for borrowing at that date.

(c) Griffon has one finance lease outstanding for real estate located in Ocala, Florida. The lease matures in 2025 and bears interest at a fixed rate of approximately 5.6%. The Ocala, Florida lease contains two five-year renewal options. At September 30, 2022, $13,091 was outstanding. During the year ended September 30, 2022, the financing lease on the Troy, Ohio location expired. The lease bore interest at a rate of approximately 5.0%, was secured by a mortgage on the real estate, which was guaranteed by Griffon, and had a one dollar buyout at the end of the lease. Griffon exercised the one dollar buyout option in November 2021. Refer to Note 21- Leases for further details.

(d) In November 2012, Garant G.P. (“Garant”), a Griffon wholly owned subsidiary, entered into a CAD 15,000 ($10,956 as of September 30, 2022) revolving credit facility. The facility accrues interest at LIBOR (USD) or the Bankers Acceptance Rate (CDN) plus 1.3% per annum (4.44% LIBOR USD and 4.76% Bankers Acceptance Rate CDN as of September 30, 2022). In October 2022 the revolving facility was amended and matures in October 2024 and is renewable upon mutual agreement with the lender. Garant is required to maintain a certain minimum equity. As of September 30, 2022, there were no borrowings under this revolving credit facility with CAD 15,000 ($10,956 as of September 30, 2022) available for borrowing.

In March 2022, Griffon Australia Holdings Pty Ltd and its Australian subsidiaries (collectively, "Griffon Australia") amended its AUD 18,375 term loan, AUD 20,000 revolver and AUD 15,000 receivable purchase facility agreement that was entered into in July 2016 and further amended in fiscal 2020. Griffon Australia paid off the term loan in the amount of AUD 9,625 and canceled the AUD 20,000 revolver. The amendment refinanced the existing AUD 15,000 receivable purchase facility. The receivable purchase facility matures in March 2023 and is renewable upon mutual agreement with the lender. The receivable purchase facility accrues interest at BBSY (Bank Bill Swap Rate) plus 1.25% per annum (3.96% at September 30, 2022). At September 30, 2022, there was no balance outstanding under the receivable purchase facility with AUD $15,000 ($9,722 as of September 30, 2022) available. The receivable purchase facility is secured by substantially all of the assets of Griffon Australia and its subsidiaries. Griffon Australia is required to maintain a certain minimum equity level.

In July 2018, the AMES Companies UK Ltd and its subsidiaries (collectively, "Ames UK") entered into a GBP 14,000 term loan, GBP 4,000 mortgage loan and GBP 5,000 revolver. The term loan and mortgage loan require quarterly principal payments of GBP 438 and GBP 105 plus interest, respectively, and have balloon payments due upon maturity, July 2023,

of GBP 7,088 and GBP 2,349, respectively. Effective in January 2022, the Term Loan and Mortgage Loan were amended to replace GBP LIBOR with SONIA. The term loan and mortgage loan each accrue interest at the SONIA Rate plus 1.80% (3.99% as of September 30, 2022). The revolver accrues interest at the Bank of England Base Rate plus 3.25% (5.50% as of September 30, 2022). The revolver matures in July 2023, and is renewable upon mutual agreement with the lender. As of September 30, 2022, the revolver had no outstanding balance, and the term and mortgage loan balances were GBP 11,060 ($12,090 as of September 30, 2022). The revolver and the term loan are both secured by substantially all the assets of AMES UK and its subsidiaries. The mortgage loan is secured by the underlying property. AMES UK is subject to a maximum leverage ratio and a minimum fixed charges cover ratio.

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