Debt

9 Months Ended

Jun. 03, 2021


	June 3, 2021										September 3, 2020
					Net Carrying Amount						Net Carrying Amount
As of	Stated Rate		Effective Rate		Current		Long-Term		Total		Current		Long-Term		Total

Finance lease obligations	N/A		3.62	%	$	144	$	454	$	598	$	76	$	410	$	486
2023 Notes	2.497	%	2.64	%	—		1,247		1,247		—		1,245		1,245
2024 Notes	4.640	%	4.76	%	—		598		598		—		598		598
2024 Term Loan A	0.975	%	1.01	%	—		1,186		1,186		—		—		—
2026 Notes	4.975	%	5.07	%	—		498		498		—		498		498
2027 Notes(1)	4.185	%	4.27	%	—		894		894		—		895		895
2029 Notes	5.327	%	5.40	%	—		696		696		—		696		696
2030 Notes	4.663	%	4.73	%	—		845		845		—		845		845
2032D Notes	3.125	%	6.33	%	152		—		152		131		—		131
MMJ Creditor Payments	N/A		N/A		1		—		1		1		—		1
Extinguished 2024 Term Loan A	N/A		N/A		—		—		—		62		1,186		1,248
					$	297	$	6,418	$	6,715	$	270	$	6,373	$	6,643

(1) On April 21, 2021, we entered into fixed-to-floating interest rate swaps on the 2027 Notes with an aggregate $900 million notional amount equal to the principal amount of the 2027 Notes. The resulting variable interest paid is at a rate equal to SOFR plus approximately 3.33%.

Revolving Credit Facility

On May 14, 2021, we terminated our existing undrawn credit facility and entered into a new five-year unsecured Revolving Credit Facility. Under the Revolving Credit Facility, we can draw up to $2.50 billion which would generally bear interest at a rate equal to LIBOR plus 1.00% to 1.75%, depending on our corporate credit ratings. Any amounts outstanding under the Revolving Credit Facility would mature in May 2026 and amounts borrowed may be prepaid without penalty. As of June 3, 2021, no amounts were outstanding under the Revolving Credit Facility and $2.50 billion was available to us.

Under the terms of the Revolving Credit Facility, we must maintain a leverage ratio, calculated as of the last day of each fiscal quarter, of total indebtedness to adjusted EBITDA not to exceed 3.25 to 1.00. The Revolving Credit Facility contains other covenants that, among other things, limit, in certain circumstances, our ability and/or the ability of our restricted subsidiaries to (1) create or incur certain liens and enter into sale and lease-back transactions, (2) create, assume, incur, or guarantee certain additional secured indebtedness and unsecured indebtedness of our restricted subsidiaries, and (3) consolidate with or merge with or into, or convey, transfer, lease, or otherwise dispose of all or substantially all of our assets, to another entity. These covenants are subject to a number of limitations, exceptions, and qualifications.

2024 Term Loans

On May 14, 2021, we drew $1.19 billion under an unsecured 2024 Term Loan A and used the proceeds to repay the $1.19 billion Extinguished 2024 Term Loan A. The 2024 Term Loan A bears interest at a rate equal to LIBOR plus 0.625% to 1.375% based on our current corporate credit ratings. The principal amount is due October 2024 and may be prepaid without penalty. The 2024 Term Loan A contains the same leverage ratio and substantially the same other covenants as the Revolving Credit Facility.

2032D Convertible Senior Notes

In the third quarter of 2021, holders of our 2032D Notes with an aggregate principal amount of $75 million converted their notes. We elected to settle notes with an aggregate principal amount of $68 million with a combination of cash for the principal amount and shares of our common stock for the remainder of the settlement amount. In the fourth quarter of 2021, we settled these conversions and issued 5.9 million shares of our stock.

For the remaining converted notes with an aggregate principal amount of $7 million, we elected to settle the conversion obligation in excess of the principal amount in cash. As a result of our election to settle all amounts due upon conversion in cash for these notes, such settlement obligations became derivative debt liabilities subject to mark-to-market accounting treatment based on the volume-weighted-average price of our common stock over a period of 20 consecutive trading days. Accordingly, at the dates of our elections to settle the conversions in cash, we reclassified the fair values of the equity components of each of the converted notes from additional capital to derivative debt liabilities within current debt in our consolidated balance sheet. Notes with a principal amount of $3 million were not settled as of the end of the third quarter of 2021 and the net carrying amount of convertible notes included $22 million for the fair values of the derivative debt liabilities.

On May 28, 2021, we notified holders of our 2032D Notes that we would redeem the remaining $59 million of principal amount of our 2032D Notes on June 29, 2021. In connection with our notice, we made an irrevocable election to settle the conversion amount with a combination of cash for the principal amount and shares of our common stock for the remainder of the settlement amount. In the fourth quarter of 2021, holders converted substantially all of the 2032D Notes.

As of June 3, 2021, based on the $82.03 trading price of our common stock and the $9.98 conversion price, the aggregate conversion value of $1.07 billion for the 2032D Notes exceeded the aggregate principal amount of $130 million by $938 million.