Long-Term Debt

6 Months Ended

Jun. 30, 2011

Long-Term Debt

Long-Term Debt

Note 9 - Long-term debt:

	December 31, 2010		June 30, 2011
	(In millions)
Valhi:
Snake River Sugar Company	$	250.0	$	250.0
Subsidiary debt:
Kronos International:
6.5% Senior Secured Notes		532.8		455.8
Revolving European credit facility		—		49.9
CompX promissory note payable to TIMET		42.2		37.7
CompX revolving credit facility		3.0		—
NL promissory note		18.0		18.0
WCS financing capital lease		72.0		71.7
WCS 6% promissory notes		15.4		15.6
Other		6.9		6.0
Total subsidiary debt		690.3		654.7
Total debt		940.3		904.7
Less current maturities		17.4		17.6
Total long-term debt	$	922.9	$	887.1

Kronos - In March 2011, Kronos redeemed euro 80 million of its euro 400 million 6.5% Senior Secured Notes at 102.17% of the principal amount for an aggregate of $115.7 million, including a $2.5 million call premium. Following such partial redemption, euro 320 million principal amount of the Senior Notes remain outstanding. Kronos borrowed under its European revolving credit facility, as discussed below, in order to fund the redemption. We recognized a $3.3 million pre-tax interest charge related to the prepayment of the 6.5% Senior Secured Notes in the first quarter of 2011, consisting of the call premium and the write-off of unamortized deferred financing costs and original issue discount associated with the redeemed Senior Notes.

During the first six months of 2011, Kronos borrowed euro 80 million ($113.3 million when borrowed) under its European credit facility and subsequently repaid euro 45 million ($65.1 million when repaid). The average interest rate on these borrowings at June 30, 2011 was 2.82%.

CompX - During the first quarter of 2011, CompX repaid its revolving bank credit facility that matures in January 2012. In July 2011, CompX borrowed approximately $5 million under its revolving credit facility in connection with the acquisition discussed in Note 2.

The CompX promissory note payable to TIMET was amended in September 2009 resulting in the deferral of interest payments and postponement of quarterly principal payments on the promissory note until March 2011. As such, in March 2011 CompX paid its required quarterly principal payment of $250,000 and all accrued interest totaling approximately $1.0 million. In addition, CompX prepaid $4.0 million principal amount on the promissory note. In the second quarter of 2011, CompX continued its regularly scheduled principal payment of $250,000 and related accrued interest for the quarter. The interest rate on the promissory note at June 30, 2011 was 1.3%.

Restrictions and Other - Certain of the credit facilities with unrelated, third-party lenders described above require the respective borrowers to maintain minimum levels of equity, require the maintenance of certain financial ratios, limit dividends and additional indebtedness and contain other provisions and restrictive covenants customary in lending transactions of this type. We are in compliance with all of our debt covenants at June 30, 2011. We believe we will be able to comply with the financial covenants contained in all of our credit facilities through the maturity of the respective facility; however, if future operating results differ materially from our expectations, we may be unable to maintain compliance.