Quarterly report pursuant to Section 13 or 15(d)

Long-Term Financing

v3.20.1
Long-Term Financing
9 Months Ended
Feb. 29, 2020
Financing [Abstract]  
Long-Term Financing Note M: Long-term Financing

On March 13, 2019, the Company and its PoNY subsidiary completed the private placement of Senior Notes, Series A in an aggregate principal amount of $400.0 million due on March 13, 2026, and Senior Notes, Series B in an aggregate principal amount of $400.0 million due on March 13, 2029 (collectively the “Notes”), pursuant to its Note Purchase and Guarantee Agreement (the “Agreement”) among the Company, PoNY, and the respective purchasers. Proceeds from the Notes were used to pay off $800.0 million in short-term borrowings under the Company’s JPM credit facilities used to temporarily finance the acquisition of Oasis.

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

February 29,

May 31,

In millions

2020

2019

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

(3.3)

(3.6)

Long-term borrowings, net of debt issuance costs

$

796.7

$

796.4

Certain information related to the Senior Notes are as follows:

Senior Notes

Senior Notes

Series A

Series B

Stated interest rate

4.07%

4.25%

Effective interest rate

4.12%

4.29%

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 include 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, PoNY 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 of these covenants as of February 29, 2020.