Notes Payable and Long-Term Debt

6 Months Ended

Feb. 29, 2020

Notes payable and long-term debt outstanding as of February 29, 2020 and August 31, 2019 are summarized below (in thousands):



	Maturity Date	February 29, 2020		August 31, 2019
5.625% Senior Notes	Dec 15, 2020	$	399,332	$	398,886
4.700% Senior Notes	Sep 15, 2022	498,332		498,004
4.900% Senior Notes	Jul 14, 2023	299,178		299,057
3.950% Senior Notes	Jan 12, 2028	495,132		494,825
3.600% Senior Notes⁽¹⁾	Jan 15, 2030	494,470		—
Borrowings under credit facilities⁽²⁾⁽³⁾	Jan 22, 2023 and Jan 22, 2025	—		—
Borrowings under commercial paper program⁽⁴⁾	⁽⁴⁾	237,661		—
Borrowings under loans⁽²⁾	Jan 22, 2025	300,095		805,693
Total notes payable and long-term debt		2,724,200		2,496,465
Less current installments of notes payable and long-term debt		637,841		375,181
Notes payable and long-term debt, less current installments		$	2,086,359	$	2,121,284


⁽¹⁾	On January 15, 2020, the Company issued $500.0 million of publicly registered 3.600% Senior Notes due 2030 (the “3.600% Senior Notes”). The net proceeds from the offering were used for the repayment of term loan indebtedness.

⁽²⁾

On January 22, 2020, the Company entered into a senior unsecured credit agreement which provides for: (i) a Revolving Credit Facility in the initial amount of $2.7 billion, of which $700.0 million expires on January 22, 2023 and $2.0 billion expires on January 22, 2025 and (ii) a $300.0 million Term Loan Facility which expires on January 22, 2025, (collectively the “Credit Facility”). Interest and fees on the Credit Facility advances are based on the Company’s non-credit enhanced long-term senior unsecured debt rating as determined by Standard & Poor’s Ratings Service, Moody’s Investors Service and Fitch Ratings. In connection with the Company’s entry into the Credit Facility, the Company terminated the Company’s amended and restated five-year credit agreement dated November 8, 2017 and the credit agreement dated August 24, 2018.

During the three months ended February 29, 2020, the interest rates on the Revolving Credit Facility ranged from 2.5% to 3.0% and the Term Loan Facility ranged from 2.9% to 3.2%. Interest is charged at a rate equal to (a) for the Revolving Credit Facility, either 0.000% to 0.450% above the base rate or 0.975% to 1.450% above the Eurocurrency rate and (b) for the Term Loan Facility, either 0.125% to 0.750% above the base rate or 1.125% to 1.750% above the Eurocurrency rate. The base rate represents the greatest of: (i) Citibank, N.A.’s prime 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. Fees include a facility fee based on the revolving credit commitments of the lenders and a letter of credit fee based on the amount of outstanding letters of credit.


⁽³⁾	As of February 29, 2020, the Company has $3.1 billion in available unused borrowing capacity under its revolving credit facilities, net of outstanding commercial paper borrowings.


⁽⁴⁾	The Company has a borrowing capacity of up to $1.8 billion under its commercial paper program. The revolving credit facility supports commercial paper outstanding, if any. As of February 29, 2020, the outstanding commercial paper has maturities of 90 days or less. During the three months ended February 29, 2020, the interest rates on the commercial paper program ranged from 2.0% to 2.6%.

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 facilities and the 4.900% Senior Notes contain debt leverage and interest coverage covenants. The Company is also subject to certain covenants requiring the Company to offer to repurchase the 5.625%, 4.700%, 4.900%, 3.950% or 3.600% Senior Notes upon a change of control. As of February 29, 2020 and August 31, 2019, the Company was in compliance with its debt covenants.

Fair Value

Refer to Note 17 – “Fair Value Measurements” for the estimated fair values of the Company’s notes payable and long-term debt.