Annual report pursuant to Section 13 and 15(d)

Long-Term Financing

v3.22.2
Long-Term Financing
12 Months Ended
May 31, 2022
Debt Disclosure [Abstract]  
Long-Term Financing

Note M — Long-term Financing

 

Long-term debt, at amortized cost, consisted of the following as of:

 

 

 

May 31,

 

In millions

 

2022

 

 

2021

 

Senior Notes, Series A

 

$

 

400.0

 

 

$

 

400.0

 

Senior Notes, Series B

 

 

 

400.0

 

 

 

 

400.0

 

Total long-term borrowings

 

 

 

800.0

 

 

 

 

800.0

 

Less: Debt issuance costs, net of accumulated amortization

 

 

 

(2.3

)

 

 

 

(2.7

)

Long-term borrowings, net of debt issuance costs

 

$

 

797.7

 

 

$

 

797.3

 

 

Certain information related to the Senior Notes, Series A and Senior Notes, Series B (collectively the “Notes”) issued pursuant to the Note Purchase and Guarantee Agreement (the “Agreement”) for fiscal 2022 and fiscal 2021 are as follows:

 

 

 

Senior Notes

 

Senior Notes

 

 

Series A

 

Series B

Stated interest rate

 

4.07%

 

4.25%

Effective interest rate

 

4.15%

 

4.31%

Interest rate type

 

Fixed

 

Fixed

Interest payment dates

 

Semi-annual, in arrears

 

Semi-annual, in arrears

Principal payment dates

 

March 13, 2026

 

March 13, 2029

Note type

 

Unsecured

 

Unsecured

 

The effective interest rates for each note series includes the interest on the note and amortization of debt issuance costs.

 

Payment of all amounts due with respect to the Notes and performance under the Agreement is guaranteed by the Company, Paychex of New York LLC, and certain other subsidiaries of the Company. The Company may, at its option, prepay at any time all, or any part of, the Notes, subject to certain conditions as described in the Agreement.

 

The 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 these covenants as of May 31, 2022.