Notes Payable, Long-Term Debt and Capital Lease Obligations

12 Months Ended

Aug. 31, 2017

Notes Payable, Long-Term Debt and Capital Lease Obligations [Abstract]

Notes Payable, Long-Term Debt and Capital Lease Obligations

9. Notes Payable, Long-Term Debt and Capital Lease Obligations

	Notes payable, long-term debt and capital lease obligations outstanding as of August 31, 2017 and 2016 are
summarized below (in thousands):

			Maturity	August 31,		August 31,
			Date	2017		2016
	8.250% Senior Notes^(1)(2)(3)		March 15, 2018	$	399,506	$	398,552
	5.625% Senior Notes⁽¹⁾⁽²⁾		Dec. 15, 2020		397,104		396,212
	4.700% Senior Notes⁽¹⁾⁽²⁾		Sept. 15, 2022		496,696		496,041
	4.900% Senior Notes⁽¹⁾⁽⁴⁾		July 14, 2023		298,571		298,329
	Borrowings under credit facilities⁽⁵⁾		July 6, 2020		―		―
	Borrowings under loans⁽⁶⁾		July 6, 2020		458,395		502,210
	Capital lease obligations				27,818		28,478
	Total notes payable, long-term debt and capital lease obligations				2,078,090		2,119,822
	Less current installments of notes payable, long-term debt and
		capital lease obligations			445,498		45,810
	Notes payable, long-term debt and capital lease obligations, less
		current installments		$	1,632,592	$	2,074,012

⁽¹⁾ The notes are carried at the principal amount of each note, less any unamortized discount and unamortized debt issuance costs.

⁽²⁾ The Senior Notes are the Company’s senior unsecured obligations and rank equally with all other existing and future senior unsecured debt obligations.

⁽³⁾ The interest rate payable on the 8.250% Senior Notes is subject to adjustment from time to time if the credit ratings assigned to the 8.250% Senior Notes increase or decrease.

⁽⁴⁾ On May 19, 2016, the Company entered into a note purchase agreement with certain third parties, which closed on July 14, 2016, for a private placement of $300.0 million of senior unsecured notes (the “4.900% Senior Notes”). The proceeds from the sale of the notes were used to repay debt maturities.

⁽⁵⁾ On July 6, 2015, the Company entered into an amended and restated senior unsecured five-year credit agreement. The credit agreement provides for: (i) the Revolving Credit Facility in the initial amount of $1.5 billion, which may, subject to the lenders’ discretion, potentially be increased up to $2.0 billion and (ii) a $500.0 million five-year delayed draw Term Loan Facility, (collectively the “Credit Facility”). The Credit Facility expires on July 6, 2020. The Revolving Credit Facility is subject to two whole or partial one-year extensions, at the lender’s discretion.

As of August 31, 2017, the interest rates on the Revolving Credit Facility ranged from 2.4% to 4.4% and the Term Loan Facility was 2.6%. Interest is charged at a rate equal to (a) for the Revolving Credit Facility, either 0.000% to 0.650% above the base rate or 1.000% to 1.650% above the Eurocurrency rate and (b) for the Term Loan Facility, either 0.125% to 1.000% above the base rate or 1.125% to 2.000% above the Eurocurrency rate. The base rate represents the greatest of: (i) Citibank, N.A.’s base rate, (ii) 0.50% above the federal funds rate, and (iii) 1.0% above one-month LIBOR, but not less than zero. The Eurocurrency rate represents adjusted LIBOR or adjusted CDOR, as applicable, for the applicable interest period, but not less than zero.

As of August 31, 2017, the Company’s foreign subsidiaries had various additional credit facilities that finance their future growth and any corresponding working capital needs. The foreign subsidiary credit facilities incur interest at fixed and variable rates ranging from 1.2% to 3.5%

As of August 31, 2017, the Company has $1.9 billion in available unused borrowing capacity under its revolving credit facilities.

⁽⁶⁾ In addition to the Term Loan Facility described above, as of August 31, 2017, the Company has borrowings outstanding to fund working capital needs. These additional loans were approximately $2.1 million and have interest rates ranging from 0.0% to 10.0%.

Debt Maturities

Debt maturities as of August 31, 2017 are as follows (in thousands):


Fiscal Year Ended August 31,		Amount
2018		$	445,498
2019			51,538
2020			364,151
2021			398,877
2022			1,993
Thereafter			816,033
	Total	$	2,078,090

Debt Covenants

Borrowings under the Company’s debt agreements are subject to various covenants that limit the Company’s ability to: incur additional indebtedness, sell assets, effect mergers and certain transactions, and effect certain transactions with subsidiaries and affiliates. In addition, the Revolving Credit Facility and 4.900% Senior Notes contain debt leverage and interest coverage covenants. The Company is also subject to a covenant requiring the repurchase of the 8.250%, 5.625%, or 4.700% Senior Notes upon a change of control. As of August 31, 2017 and 2016, the Company was in compliance with its debt covenants.

Fair Value

The estimated fair values of the Company's publicly traded debt, including the 8.250%, 5.625% and 4.700% senior notes, were approximately $414.0 million, $433.6 million and $530.6 million respectively, as of August 31, 2017. The fair value estimates are based upon observable market data (Level 2 criteria). The estimated fair value of the Company's private debt, the 4.900% senior notes, was approximately $316.6 million, as of August 31, 2017. This fair value estimate is based on the Company's indicative borrowing cost derived from discounted cash flows (Level 3 criteria). The carrying amounts of borrowings under credit facilities and under loans approximates fair value as interest rates on these instruments approximates current market rates.