Debt

6 Months Ended

Apr. 30, 2021

The following tables present the components of Notes payable and current maturities of long-term debt and Long-term debt in our Consolidated Balance Sheets:


(in millions)	April 30, 2021		October 31, 2020
Manufacturing operations
Senior Secured Term Loan Credit Agreement, due 2025, net of unamortized discount of $4 and $5, respectively, and unamortized debt issuance costs of $7 and $8, respectively	$	1,537	$	1,543

9.5% Senior Secured Notes, due 2025, net of unamortized debt issuance costs of $10 and $11, respectively	590		589
6.625% Senior Notes, due 2026, net of unamortized debt issuance costs of $12 and $13, respectively	1,088		1,087





Loan Agreement related to 4.75% Tax Exempt Bonds, due 2040, net of unamortized debt issuance costs of $2 at both dates	223		223

Financed lease obligations	36		45

Other	6		9
Total Manufacturing operations debt	3,480		3,496
Less: Current portion	39		45
Net long-term Manufacturing operations debt	$	3,441	$	3,451


(in millions)	April 30, 2021		October 31, 2020
Financial Services operations
Asset-backed debt issued by consolidated SPEs, at fixed and variable rates, due serially through 2022, net of unamortized debt issuance costs of $2 and $4, respectively	$	967	$	724

Bank credit facilities, at fixed and variable rates, due dates from 2021 through 2026, net of unamortized debt issuance costs of less than $1 and $1, respectively	836		940
Commercial paper, at variable rates, program matures in 2022	15		—
Borrowings secured by operating and finance leases, at various rates, due serially through 2026	169		170
Total Financial Services operations debt	1,987		1,834
Less: Current portion	804		595
Net long-term Financial Services operations debt	$	1,183	$	1,239

Manufacturing Operations

9.5% Senior Secured Notes due 2025

On April 26, 2021, NIC issued a notice for conditional call for redemption of all of its outstanding 9.5% Senior Secured Notes due 2025 (the “Senior Secured Notes”). The conditional redemption notice calls for redemption of the Senior Secured Notes on June 25, 2021 at a redemption price of 107.125% of the principal amount redeemed, which amount is equal to $1,071.25 per $1,000 principal amount of the Senior Secured Notes, plus accrued and unpaid interest up to, but not including, the redemption date, in accordance with the provisions of the indenture governing the Senior Secured Notes. The redemption is subject to and expressly conditioned upon the consummation of the closing of the merger of Merger Subsidiary with and into Navistar pursuant to the Merger Agreement, on terms satisfactory to Navistar and TRATON SE (the “Senior Secured Notes Merger Condition”). The redemption date will be delayed until such time as the Senior Secured Notes Merger Condition is satisfied (including more than 60 days after the issue date of the conditional redemption notice) or the conditional redemption notice is rescinded if the Senior Secured Notes Merger Condition is not satisfied on or prior to the redemption date or the redemption date so delayed.

4.75% Tax Exempt Bonds due 2040

On May 27, 2021, at the direction of NIC, a notice of conditional optional redemption was issued for all of the outstanding $225 million aggregate principal amount of Illinois Finance Authority (“IFA”) Recovery Zone Facility Refunding Revenue Bonds (Navistar International Corporation Project) Series 2020 (the “4.75% Tax Exempt Bonds”). The original proceeds from the 4.75% Tax Exempt Bonds were loaned by the IFA to the Company pursuant to a Loan Agreement dated as of July 1, 2020. The conditional redemption notice calls for redemption of the 4.75% Tax Exempt Bonds on July 2, 2021 at the redemption price of 100.00% of the principal amount redeemed plus accrued and unpaid interest up to, but not including, the redemption date, in accordance with the provisions of the indenture governing the 4.75% Tax Exempt Bonds. The redemption is subject to and expressly conditioned upon (i) the consummation of the closing of the merger of Merger Subsidiary with and into the Company, with the Company surviving the Merger, pursuant to the Merger Agreement on terms satisfactory to the Company and the Parent and in which the holders of the common stock of the Company outstanding immediately prior to the Merger do not hold, directly or indirectly, at least a majority of the common stock of the Company after the Merger (the “4.75% Tax Exempt Bonds Merger Condition”) and (ii) the receipt by Citibank, N.A., as trustee under the indenture governing the 4.75% Tax Exempt Bonds, on or prior to the redemption date of the appropriate funds required to pay the redemption price plus accrued and unpaid interest up to, but not including, the redemption date, to redeem the 4.75% Tax Exempt Bonds on the redemption date. In the event that the 4.75% Tax Exempt Bonds Merger Condition is not satisfied on or prior to the redemption date or Citibank, N.A. does not receive sufficient monies to redeem the 4.75% Tax Exempt Bonds on the redemption date, the redemption will not occur on the redemption date.

Financial Services Operations

Asset-backed Debt

The Truck Retail Accounts Corporation (“TRAC”) funding facility has a capacity range of $100 million to $200 million and renews automatically, subject to six months lender cancellation notice. Amounts borrowed under this facility for the six months ended April 30, 2021 and 2020 were $147 million and $97 million, respectively. Repayments under this facility for the six months ended April 30, 2021 and 2020 were $181 million and $188 million, respectively.

In April 2021, the maturity date of our variable funding notes ("VFN") facility was extended to April 2022, and the maximum capacity remained at $350 million. Amounts borrowed under this facility for the six months ended April 30, 2021 and 2020 were $285 million and $140 million, respectively. Repayments under this facility for the six months ended April 30, 2021 and 2020 were $10 million and $245 million, respectively.

In May 2021, $300 million of investor notes issued in 2019 by Navistar Financial Securities Corporation were fully repaid upon maturity.