Financing Arrangements

12 Months Ended

May 31, 2022

Financing Arrangements

Financing Arrangements

4. Financing Arrangements

Debt Outstanding

A summary of the carrying amount of our debt is as follows:

	May 31,
	2022		2021
Revolving Credit Facility expiring September 25, 2024 with interest payable monthly	$	100.0	$	109.5
Term loan repaid November 1, 2021 with interest paid monthly		—		25.7
Total debt		100.0		135.2
Debt issuance costs, net		(1.1)		(1.5)
Long-term debt	$	98.9	$	133.7

At May 31, 2022, our variable rate debt had a fair value that approximates its carrying value and is classified as Level 2 in the fair value hierarchy.

On October 18, 2017, we entered into a Credit Agreement with the Canadian Imperial Bank of Commerce, as lender (the “Credit Agreement”). The Credit Agreement provided a Canadian $31 million term loan with the proceeds used to fund the acquisition of two MRO facilities in Canada from Premier Aviation. The term loan was paid in full at the expiration of the Credit Agreement on November 1, 2021.

We maintain a Revolving Credit Facility with various financial institutions, as lenders, and Bank of America, N.A., as administrative agent for the lenders, which provides the Company an aggregate revolving credit commitment of $600 million and matures September 25, 2024.  Under certain circumstances, we have the ability to request, but our lenders are not required to grant, an increase to the revolving credit commitment by an aggregate amount of up to $300 million, not to exceed $900 million in total.

Borrowings under the Revolving Credit Facility bear interest at the offered Eurodollar Rate plus 87.5 to 175 basis points based on certain financial measurements if a Eurodollar Rate loan, or at the offered fluctuating Base Rate plus 0 to 75 basis points based on certain financial measurements if a Base Rate loan.

Borrowings outstanding under the Revolving Credit Facility at May 31, 2022 were $100.0 million and there were approximately $11.4 million of outstanding letters of credit, which reduced the availability of this facility to $488.6 million.

Our financing arrangements also require us to comply with leverage and interest coverage ratios, maintain a minimum net working capital level, and comply with certain affirmative and negative covenants, including those relating to financial reporting and notification, payment of indebtedness, cash dividends, taxes and other obligations, compliance with applicable laws, and limitations on additional liens, indebtedness, acquisitions, investments and disposition of assets.  The Revolving Credit Facility also requires our significant domestic subsidiaries, and any subsidiaries that guarantee our other indebtedness, to provide a guarantee of payment under the Revolving Credit Facility.  At May 31, 2022, we were in compliance with the financial and other covenants in our financing agreements.

Borrowing activity under the Revolving Credit Facility during fiscal 2022, 2021 and 2020 is as follows:

	For the Year Ended May 31,
	2022			2021			2020
Maximum amount borrowed	$	124.5		$	579.5		$	579.5
Average daily borrowings		105.9			257.5			280.7
Average interest rate during the year		1.09	%		1.20	%		2.62	%

We also have $9.3 million available under foreign lines of credit as of May 31, 2022.