Note G: Supplemental Information

Leases: During the three months ended August 31, 2020, the Company ceased the use of certain leased property and accelerated the amortization of related operating lease right-of-use assets, resulting in an additional $24.4 million of expense. This expense was included in the prior year period in selling, general and administrative expenses on the Consolidated Statements of Income and Comprehensive Income. The related lease liabilities will be satisfied under the original terms of the lease arrangements, unless buy-outs have been or can be negotiated.

Property and equipment, net of accumulated depreciation: Depreciation expense was $34.9 million and $98.1 million for the three and nine months ended February 28, 2022, respectively, compared to $30.4 million and $92.1 million for the three and nine months ended February 28, 2021, respectively. During the three months ended August 31, 2020, the Company disposed of certain furniture and fixtures associated with abandoned leased property and recorded a loss on disposal of $5.1 million. The loss was recorded in the prior year period in selling, general and administrative expenses on the Consolidated Statements of Income and Comprehensive Income.

Goodwill and intangible assets, net of accumulated amortization: Amortization expense relating to intangible assets was $13.5 and $44.6 million for the three and nine months ended February 28, 2022, respectively, compared to $16.0 million and $52.5 million for the three and nine months ended February 28, 2021, respectively. The Company did not recognize an impairment loss as it relates to its goodwill or intangible assets during the nine months ended February 28, 2022 or February 28, 2021.

Short-term financing: Outstanding borrowings on the Company’s credit facilities had a weighted-average interest rate of 1.28% and 1.16% as of February 28, 2022 and May 31, 2021, respectively. The unused amount available under these credit facilities as of February 28, 2022 was approximately $2.0 billion.

On September 17, 2021, the Company amended its $500.0 million credit facility with JP Morgan Chase Bank, N.A. (“JPM”). The amendment increases the credit facility’s maximum borrowing capacity to $750.0 million, extends the term through September 17, 2026 with the option to extend for two additional one-year periods, and amends interest rate provisions to phase out the use of the London Interbank Offered Rate (“LIBOR”). In addition, the Company amended its $1.0 billion credit facility with JPM. The amendment phases out the use of LIBOR and adopts other administrative changes to maintain consistency with the Company’s other credit facilities.

The credit facilities contain various financial and operational covenants that are usual and customary for such arrangements. The Company was in compliance with all of these covenants as of February 28, 2022.

Letters of credit: The Company had irrevocable standby letters of credit available totaling $139.7 million and $180.4 million as of February 28, 2022 and May 31, 2021, respectively, required to secure commitments for certain insurance policies. The letters of credit expire at various dates between April 1, 2022 and February 5, 2023. No amounts were outstanding on these letters of credit as of, or during the nine months ended February 28, 2022 and February 28, 2021, or as of May 31, 2021.

Long-term debt: The Company’s long-term debt agreement contains customary representations, warranties, affirmative and negative covenants, including financial covenants that are usual and customary for such arrangements. The Company was in compliance with all of these covenants as of February 28, 2022.