|
|
Date of Report (Date of earliest event reported): May 9, 2014
|
|
MINERALS TECHNOLOGIES INC.
|
(Exact name of registrant as specified in its charter)
|
Delaware
|
|
1-11430
|
|
25-1190717
|
(State or other jurisdiction
of incorporation) |
|
(Commission File
Number) |
|
(IRS Employer
Identification No.) |
622 Third Avenue, New York, NY
|
|
10017-6707
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
(212) 878-1800
|
|
(Registrant's telephone number, including area code)
|
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions.
|
|
|
|
[ ]
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
|
|
[ ]
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
|
|
[ ]
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
|
|
[ ]
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c)) |
|
|
|
|
|
|
||
|
|
This Amendment No. 1 to the Current Report on Form 8-K, which was originally filed with the Securities and Exchange Commission on May 9, 2014 (the "Original 8-K"), amends and restates in its entirety Item 9.01 of the Original 8-K to include the financial statements and pro forma financial information required by Item 9.01 of Form 8-K with respect to the acquisition by Minerals Technologies Inc. of AMCOL International Corporation on May 9, 2014. The remainder of the information in the Original 8-K is not hereby amended.
|
||
|
|
|
||
|
|
|
||
Item 9.01
|
|
Financial Statements and Exhibits.
|
||
|
|
(a)
|
Financial statements of business acquired
|
|
|
|
|
(1)
|
The historical audited consolidated financial statements of AMCOL International Corporation required by Item 9.01(a) are incorporated by reference herein.
|
|
|
|
(2) The consent of Ernst & Young LLP, AMCOL's independent auditors is attached as Exhibit 23.1 to this Current Report on Form 8-K and is incorporated by reference herein.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(b)
|
Pro forma financial information
The unaudited pro forma condensed combined financial statements required by Item 9.01(b) are attached as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated by reference herein.
|
|
|
|
|
|
|
|
|
(d)
|
Exhibits
|
|
|
|
|
|
|
|
|
|
The following exhibits are filed with this Current Report on Form 8-K.
|
|
|
|
|
|
|
Exhibit No.
|
|
|
Exhibit Description
|
|
2.1
|
|
|
Agreement and Plan of Merger, dated as of March 10, 2014, by and among Minerals Technologies Inc., MA Acquisition Inc. and AMCOL International Corporation (incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by Minerals Technologies Inc. on March 10, 2014).
|
|
10.1
|
|
|
Credit Agreement dated as of May 9, 2014, among Minerals Technologies Inc., the borrowing subsidiaries party thereto, the lenders party thereto, Barclays Bank PLC and U.S. Bank National Association, as Syndication Agents, Sumitomo Mitsui Banking Corporation, as Documentation Agent, and JPMorgan Chase Bank, N.A., Administrative Agent. (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by Minerals Technologies Inc. on May 9, 2014).
|
|
23.1
|
|
|
Consent of Ernst & Young LLP.
|
|
99.1
|
|
|
The historical audited consolidated financial statements of AMCOL International Corporation as of and for the fiscal year ended December 31, 2013, filed with the SEC on March 3, 2014 (Commission File No. 001-14447) and incorporated herein by reference.
|
|
99.2
|
|
|
Unaudited pro forma condensed combined financial statements as of and for the year ended December 31, 2013.
|
SIGNATURES
|
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
|
|
MINERALS TECHNOLOGIES INC.
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Douglas T. Dietrich
|
|
|
Name:
|
Douglas T. Dietrich
|
|
|
Title:
|
Senior Vice President-Finance and Treasury and Chief Financial Officer
|
|
|
|
|
Date: July 11, 2014
|
|
|
MINERALS TECHNOLOGIES INC.
|
||
EXHIBIT INDEX
|
||
|
|
|
Exhibit No.
__________ |
|
Exhibit Description
____________________________________________________________ |
|
|
|
2.1
|
|
Agreement and Plan of Merger, dated as of March 10, 2014, by and among Minerals Technologies Inc., MA Acquisition Inc. and AMCOL International Corporation (incorporated herein by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by Minerals Technologies Inc. on March 10, 2014).
|
10.1
|
|
Credit Agreement dated as of May 9, 2014, among Minerals Technologies Inc., the borrowing subsidiaries party thereto, the lenders party thereto, Barclays Bank PLC and U.S. Bank National Association, as Syndication Agents, Sumitomo Mitsui Banking Corporation, as Documentation Agent, and JPMorgan Chase Bank, N.A., Administrative Agent. (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by Minerals Technologies Inc. on May 9, 2014).
|
23.1
|
|
Consent of Ernst & Young LLP.*
|
99.1
|
|
The historical audited consolidated financial statements of AMCOL International Corporation as of and for the fiscal year ended December 31, 2013, filed with the SEC on March 3, 2014 (Commission File No. 001-14447) and incorporated by reference herein.
|
99.2
|
|
Unaudited pro forma condensed combined financial statements as of and for the year ended December 31, 2013.*
|
* Filed herewith
|
|
/s/ Ernst & Young LLP
|
Chicago, Illinois
|
July 11, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
(in millions)
|
|
MTI
|
|
|
AMCOL
|
|
|
Pro Forma
Adjustments
Note 5
|
|
|
Combined
|
|
|||||||||||
|
|
|
|
|
|||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
$
|
490.3
|
|
|
$
|
47.8
|
|
|
$
|
(409.8)
|
(a)
|
|
$
|
128.3
|
||||||||
Accounts receivable, net
|
|
|
204.4
|
|
|
|
213.5
|
|
|
|
|
|
|
|
417.9
|
||||||||
Inventories, net
|
|
|
89.2
|
|
|
|
149.2
|
|
|
|
8.0
|
(b)
|
|
|
246.4
|
||||||||
Other current assets
|
|
|
31.2
|
|
|
|
50.0
|
|
|
|
|
|
|
|
81.2
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total current assets
|
|
|
815.1
|
|
|
|
460.5
|
|
|
|
(401.8)
|
|
|
|
873.8
|
||||||||
|
|
|
|
|
|||||||||||||||||||
Property, net
|
|
|
306.1
|
|
|
|
263.6
|
|
|
|
663.0
|
(d)
|
|
|
1,232.7
|
||||||||
Goodwill
|
|
|
64.4
|
|
|
|
68.7
|
|
|
|
573.3
|
(e)
|
|
|
706.4
|
||||||||
Intangible assets, net
|
|
|
3.5
|
|
|
|
27.9
|
|
|
|
186.2
|
(f)
|
|
|
217.6
|
||||||||
Other non-current assets
|
|
|
28.4
|
|
|
|
58.0
|
|
|
|
28.7
|
(c)
|
|
|
115.1
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total assets
|
|
$
|
1,217.5
|
|
|
$
|
878.7
|
|
|
$
|
1,049.4
|
|
|
$
|
3,145.6
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|||||||||||||||||||
Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Short-term debt, including current portion of long-term debt
|
|
$
|
13.7
|
|
|
$
|
—
|
|
|
$
|
|
|
|
$
|
13.7
|
||||||||
Accounts payable
|
|
|
94.9
|
|
|
|
52.0
|
|
|
|
|
|
|
|
146.9
|
||||||||
Accrued expenses
|
|
|
72.3
|
|
|
|
69.0
|
|
|
|
(6.0)
|
(c)
|
|
|
135.3
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total current liabilities
|
|
|
180.9
|
|
|
|
121.0
|
|
|
|
(6.0)
|
|
|
|
295.9
|
||||||||
|
|
|
|
|
|||||||||||||||||||
Long-term debt
|
|
|
75.0
|
|
|
|
249.1
|
|
|
|
1,220.3
|
(c)
|
|
|
1,544.4
|
||||||||
Pension & post-retirement benefits
|
|
|
57.9
|
|
|
|
26.6
|
|
|
|
—
|
|
|
|
84.5
|
||||||||
Deferred income taxes
|
|
|
—
|
|
|
|
3.2
|
|
|
|
297.2
|
(g)
|
|
|
300.4
|
||||||||
Other non-current liabilities
|
|
|
29.3
|
|
|
|
32.3
|
|
|
|
|
|
|
|
61.6
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total noncurrent liabilities
|
|
|
162.2
|
|
|
|
311.2
|
|
|
|
1,517.5
|
|
|
|
1,990.9
|
||||||||
|
|
|
|
|
|||||||||||||||||||
Total shareholders' equity related to controlling interests
|
|
|
847.5
|
|
|
|
450.2
|
|
|
|
(462.1)
|
(h)
|
|
|
835.6
|
|
|||||||
Noncontrolling interests
|
|
|
26.9
|
|
|
|
(3.7)
|
|
|
|
|
|
|
|
23.2
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total shareholders' equity
|
|
|
874.4
|
|
|
|
446.5
|
|
|
|
(462.1)
|
|
|
|
858.8
|
||||||||
|
|
|
|
|
|||||||||||||||||||
Total liabilities and shareholders' equity
|
|
$
|
1,217.5
|
|
|
$
|
878.7
|
|
|
$
|
1,049.4
|
|
|
$
|
3,145.6
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions, except per share data)
|
|
MTI
|
|
|
AMCOL
|
|
|
Pro Forma
Adjustments
Note 5
|
|
|
Combined
|
|
||||
|
|
|
|
|
||||||||||||
Sales
|
|
$
|
1,018.2
|
|
|
$
|
1,012.7
|
|
|
$
|
|
|
|
$
|
2,030.9
|
|
Cost of sales
|
|
|
784.5
|
|
|
|
797.1
|
|
|
|
10.0
|
(j)
|
|
|
1,591.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
|
233.7
|
|
|
|
215.6
|
|
|
|
(10.0
|
)
|
|
|
439.3
|
|
Selling and administrative expense
|
|
|
106.8
|
|
|
|
179.8
|
|
|
|
4.0
|
(k)
|
|
|
290.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
126.9
|
|
|
|
35.8
|
|
|
|
(14.0
|
)
|
|
|
148.7
|
|
Interest expense, net
|
|
|
(0.3
|
)
|
|
|
(10.3
|
)
|
|
|
(57.4
|
) (l)
|
|
|
(68.0
|
)
|
Other expense, net
|
|
|
(2.9
|
)
|
|
|
9.8
|
|
|
|
|
|
|
|
6.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations, before income taxes
|
|
|
123.7
|
|
|
|
35.3
|
|
|
|
(71.4
|
)
|
|
|
87.6
|
|
Income tax (expense) benefit
|
|
|
(34.5
|
)
|
|
|
(11.0
|
)
|
|
|
25.0
|
(m)
|
|
|
(20.5
|
)
|
Income from affiliates and joint ventures
|
|
|
—
|
|
|
|
3.2
|
|
|
|
—
|
|
|
|
3.2
|
|
Income from continuing operations
|
|
|
89.2
|
|
|
|
27.5
|
|
|
|
(46.4)
|
|
|
|
70.3
|
|
Net (income) loss for noncontrolling interests
|
|
|
(3.1
|
)
|
|
|
6.9
|
|
|
|
—
|
|
|
|
3.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income from continuing operations attributable to MTI shareholders
|
|
$
|
86.1
|
|
|
$
|
34.4
|
|
|
$
|
(46.4)
|
|
|
$
|
74.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income from continuing operations per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
2.48
|
|
|
$
|
1.06
|
|
|
|
|
|
|
$
|
2.14
|
|
Diluted
|
|
$
|
2.46
|
|
|
$
|
1.05
|
|
|
|
|
|
|
$
|
2.12
|
|
|
|
|
|
|
||||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
34.7
|
|
|
|
32.5
|
|
|
|
(32.5
|
) (n)
|
|
|
34.7
|
|
Diluted
|
|
|
35.0
|
|
|
|
32.8
|
|
|
|
(32.8
|
) (n)
|
|
|
35.0
|
|
|
•
|
|
Historical consolidated financial statements of MTI as of and for the year ended December 31, 2013 and the related notes included in MTI's Annual Report on Form 10-K for the year ended December 31, 2013.
|
|
•
|
|
Historical consolidated financial statements of AMCOL as of and for the year ended December 31, 2013 and the related notes, which are incorporated by reference into this Current Report on Form 8-K.
|
|
(1)
|
AMCOL's cost of sales reflects an impairment charge related to its South African chromite operations that increased cost of goods sold by $52.2 million and selling and administrative expenses by $0.1 million, and accordingly reduced operating income by $52.3 million. The after-tax impact on the AMCOL's statement of operations was $42.0 million or $1.28 per diluted share.
|
|
|
|
|
|
|
AMCOL shares outstanding
|
|
|
32.6
|
|
|
AMCOL restricted stock units & accelerated vesting of stock options
|
|
|
0.6
|
|
|
|
|
|
|
|
|
AMCOL shares to be purchased
|
|
|
33.2
|
|
|
|
|
|
|
|
|
Purchase price
|
|
|
$ 45.75
|
|
|
|
|
|
|
|
|
Cash consideration transferred to AMCOL shareholders
|
|
|
$1,519.4
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
|
AMCOL revolving credit facility repaid at close
|
|
|
$186.3
|
*
|
|
AMCOL senior notes repaid at close (including make-whole and interest payable)
|
|
|
$139.3
|
*
|
|
|
|
|
|
|
|
Total consideration transferred to debt and equity holders
|
|
|
$1,845.0
|
|
|
|
|
|
|
|
*
|
In accordance with the provisions of AMCOL's senior notes due 2017 and its credit facility, upon a change in control, any amounts outstanding, including make-whole provisions and accrued interest, are required to be repaid. The amounts reflected herein represent the amount of principal and interest outstanding and reflected in AMCOL's balance sheet as of the date of closing of $311.7 million and a $13.9 million make-whole provision on existing AMCOL debt.
|
|
|
|
|
|
|
Total estimated purchase consideration transferred
|
|
$
|
1,845.0
|
|
|
Book value of net assets acquired
|
|
|
(386.1
|
)
|
|
Elimination of AMCOL historical goodwill and intangible assets
|
|
|
96.6
|
|
|
Fair value adjustments to other intangible assets
|
|
|
(214.1
|
) (a)
|
|
Fair value adjustments to inventories
|
|
|
(8.0
|
)
|
|
Fair value adjustments to property
|
|
|
(663.0
|
)
|
|
Adjustment to deferred tax liabilities to reflect fair value adjustments
|
|
|
297.2
|
|
|
Repayment of AMCOL senior notes (including make-whole and interest payable) and revolving credit facility
|
|
|
(325.6
|
)
|
|
|
|
|
|
|
|
Estimated goodwill
|
|
$
|
642.0
|
|
|
|
|
|
|
|
|
(a)
|
Intangible assets – The following table summarizes the preliminary intangible asset fair values and useful lives which are subject to change upon completion of the final valuation.
|
|
|
|
|
|
|
|
|
|
|
|
(in millions)
|
|
Fair
Value
|
|
|
Useful
Life
|
|
|
Valuation Method
|
||
Technology
|
|
|
21.1
|
|
|
|
10-20 years
|
|
|
Relief-from royalty
|
Tradenames
|
|
|
193.0
|
|
|
|
25-40 years
|
|
|
Multi-period excess earnings
|
|
|
$
|
214.1
|
|
|
|
|
|
|
|
|
(a)
|
Sources and uses of funds (in millions):
|
|
|
|
|
|
Sources of funds:
|
|
|
|
|
Term Facility, net of original issue discount of $15.6 million
|
|
$
|
1,544.4
|
|
|
|
|||
Uses of funds:
|
|
|
|
|
Deferred financing fees
|
|
|
28.7
|
|
Repayment of AMCOL outstanding senior notes and revolving credit facility, including accrued interest
|
|
|
311.7
|
|
Make-whole fees relating to repayment of AMCOL senior notes
|
|
|
13.9
|
|
Cash consideration to holders of AMCOL common stock at $45.75 per share
|
|
|
1,519.4
|
|
Refinancing of MTI Senior Notes
|
|
|
75.0
|
|
Make-whole fees related to refinancing of MTI Senior Notes related to the acquisition due at close
|
|
|
5.5
|
|
|
|
|
|
|
Total estimated uses of funds
|
|
|
1,954.2
|
|
|
|
|
|
|
Net decrease to cash
|
|
$
|
(409.8
|
)
|
|
|
|
|
|
|
(b)
|
Reflects the step-up of inventory to fair value.
|
|
(c)
|
On May 9, 2014, MTI entered into the $1.560 billion Term Facility, the net proceeds of which, together with MTI's cash on hand, were used as cash consideration for the acquisition of AMCOL and to refinance certain existing indebtedness of MTI and AMCOL and to pay fees and expenses in connection with the foregoing. The Term Facility has been classified as long-term based upon its terms.
|
|
|
|
|
|
|||||
Estimated deferred financing fees incurred in connection with the Term Facility
|
|
$
|
28.7
|
|
|||||
|
|
|
|
|
|||||
Net adjustment to other non-current assets related to deferred financing fees
|
|
$
|
28.7
|
|
|||||
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reduction in taxes payable related to certain non-recurring charges reflected in retained earnings
|
|
|
(6.0
|
)
|
|
|
|
|
|
Net adjustment to accrued expenses
|
|
$
|
(6.0)
|
|
|
|
|
|
|
|
|
|
|
|
Repayment of existing AMCOL debt and revolving credit facility
|
|
$
|
(249.1
|
)
|
Repayment of existing MTI Senior Notes
|
|
|
(75.0
|
)
|
Term Facility incurred in connection with the acquisition, net of original issue discount
|
|
|
1,544.4
|
|
|
|
|
|
|
Net adjustment to long-term debt
|
|
$
|
1,220.3
|
|
|
|
|
|
|
|
(d)
|
Reflects the step-up of property to fair value.
|
|
(e)
|
Reflects the net adjustment related to the elimination of AMCOL's historical goodwill of $68.7 million and recording the excess of the estimated purchase price consideration over the estimated fair value of net assets acquired of $642.0 million.
|
|
(f)
|
Reflects the elimination of AMCOL's historical intangible assets of $27.9 million and recording the preliminary estimate of fair value of intangible assets acquired of $214.1 million.
|
|
(g)
|
Reflects the adjustment to deferred taxes of $297.2 million related to the fair value adjustments of acquired assets included in the purchase price. Tax impacts were estimated using a statutory rate of 35%.
|
|
(h)
|
The historical shareholders' equity of AMCOL has been eliminated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||
|
|
Shareholders' Equity
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
Common
Stock
|
|
|
Additional
Paid-in
Capital
|
|
|
Retained
Earnings
|
|
|
Common
Stock
Held In Treasury
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Net
Impact
on
Equity
|
|||||||||||||||||||||||||||||||||||||||||||||||||||
Elimination of AMCOL historical equity
|
|
$
|
(0.3
|
)
|
|
$
|
(117.1
|
)
|
|
$
|
(359.5)
|
|
|
$
|
—
|
|
|
$
|
26.7
|
|
|
$
|
(450.2
|
)
|
||||||||||||||||||||||||||||||||||||||||||
Write-off of MTI Senior Note make-whole fees & deferred financing fees, net of tax
|
|
|
—
|
|
|
|
—
|
|
|
|
(3.8
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(3.8
|
)
|
||||||||||||||||||||||||||||||||||||||||||
MTI transaction costs, net of tax
|
|
|
—
|
|
|
|
—
|
|
|
|
(8.1
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(8.1
|
)
|
||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||
Total pro forma adjustments
|
|
$
|
(0.3
|
)
|
|
$
|
(117.1
|
)
|
|
$
|
(371.4
|
)
|
|
$
|
—
|
|
|
$
|
26.7
|
|
|
$
|
(462.1
|
)
|
||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(j)
|
Reflects the adjustment to AMCOL's historical depreciation expense based upon the preliminary valuation and estimated useful lives of fixed assets.
|
(in millions)
|
Fair
Value
|
Useful
Life
|
Depreciation Method
|
|||
Mineral Reserves
|
547.2
|
10 - 50 years
|
Units of Production
|
|||
Property & Equipment
|
379.4 |
3-20 years
|
Straight Line
|
|||
$ | 926.6 |
|
(k)
|
Adjustments to selling and administrative expense are as follows:
|
|
|
|
|
|
||
Elimination of AMCOL's historical intangible asset amortization
|
|
$
|
(3.5
|
)
|
||
Estimated intangible asset amortization, as described in Note 4
|
|
|
7.5
|
|
||
|
|
|
|
|
||
Net increase to selling and administrative expense
|
|
$
|
4.0
|
|
||
|
|
|
|
|
|
(l)
|
The following adjustments were made to interest expense :
|
|
|
|
|
|
Elimination of historical AMCOL interest expense and amortization of deferred financing costs, related to debt repaid at close
|
|
$
|
10.3
|
|
Elimination of historical MTI interest expense, net of interest income of $2 million
|
|
|
1.0
|
|
Amortization of deferred financing fees on new debt
|
|
|
(4.1)
|
|
Term Facility interest expense and amortization of original issue discount
|
|
|
(64.6
|
)
|
|
|
|
|
|
Net increase to interest expense, net
|
|
$
|
(57.4
|
)
|
The interest rate on the Term Facility is Libor plus 3.25% with a minimum Libor rate of 0.75 percent. The current Libor rate is 0.23 percent. A one percent increase in the Libor rate above 0.75 percent would result in additional interest expense of $15.6 million.
|
|
|
|
|
Deferred financing fees related to MTI's Term Facility will be amortized over its seven-year term.
|
|
|
|
|
|
(m)
|
Reflects the recognition of income taxes on the pro forma adjustments using a statutory income tax rate of 35%. The actual effective tax rate of the combined company could differ.
|
|
(n)
|
The unaudited pro forma condensed combined basic and diluted earnings per share calculations are based on the MTI's weighted average basic and diluted shares. The historical weighted average basic and diluted shares of AMCOL are assumed to be canceled.
|