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Debt | 9 Months Ended
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Jun. 01, 2023
Debt Disclosure [Abstract] |
Debt | Debt
| June 1, 2023 |  | September 1, 2022
|  |  | Net Carrying Amount |  | Net Carrying Amount
As of | Stated Rate | Effective Rate | Current | Long-Term | Total |  | Current | Long-Term | Total
2024 Term Loan A | 5.860 | % | 5.90 | % | $ | — |  | $ | 587 |  | $ | 587 |  |  | $ | — |  | $ | 1,187 |  | $ | 1,187 |
2025 Term Loan A | 6.503 | % | 6.64 | % | — |  | 1,050 |  | 1,050 |  |  | — |  | — |  | — |
2026 Term Loan A | 6.628 | % | 6.76 | % | 49 |  | 933 |  | 982 |  |  | — |  | — |  | — |
2027 Term Loan A | 6.753 | % | 6.89 | % | 57 |  | 1,078 |  | 1,135 |  |  | — |  | — |  | — |
2026 Notes | 4.975 | % | 5.07 | % | — |  | 499 |  | 499 |  |  | — |  | 498 |  | 498 |
2027 Notes(1) | 4.185 | % | 4.27 | % | — |  | 796 |  | 796 |  |  | — |  | 806 |  | 806 |
2028 Notes | 5.375 | % | 5.52 | % | — |  | 596 |  | 596 |  |  | — |  | — |  | — |
2029 A Notes | 5.327 | % | 5.40 | % | — |  | 697 |  | 697 |  |  | — |  | 697 |  | 697 |
2029 B Notes | 6.750 | % | 6.54 | % | — |  | 1,263 |  | 1,263 |  |  | — |  | — |  | — |
2030 Notes | 4.663 | % | 4.73 | % | — |  | 846 |  | 846 |  |  | — |  | 846 |  | 846 |
2032 Green Bonds | 2.703 | % | 2.77 | % | — |  | 995 |  | 995 |  |  | — |  | 994 |  | 994 |
2033 A Notes | 5.875 | % | 5.96 | % | — |  | 745 |  | 745 |  |  | — |  | — |  | — |
2033 B Notes | 5.875 | % | 6.01 | % | — |  | 890 |  | 890 |  |  | — |  | — |  | — |
2041 Notes | 3.366 | % | 3.41 | % | — |  | 497 |  | 497 |  |  | — |  | 496 |  | 496 |
2051 Notes | 3.477 | % | 3.52 | % | — |  | 496 |  | 496 |  |  | — |  | 496 |  | 496 |
Finance lease obligations | N/A | 3.48 | % | 153 |  | 1,018 |  | 1,171 |  |  | 103 |  | 783 |  | 886 |
|  |  | $ | 259 |  | $ | 12,986 |  | $ | 13,245 |  |  | $ | 103 |  | $ | 6,803 |  | $ | 6,906 |
(1) In 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%. The fixed-to-floating interest rate swaps are accounted for as fair value hedges, and as a result, the carrying values of our 2027 Notes reflect adjustments in fair value. Debt Activity The table below presents the effects of debt financing and prepayment activities in the first nine months of 2023.
| Increase (Decrease) in Principal | Increase (Decrease) in Carrying Value | Increase (Decrease) in Cash
Issuances |  |  |
2025 Term Loan A | $ | 1,052 |  | $ | 1,050 |  | $ | 1,050 |
2026 Term Loan A | 996 |  | 994 |  | 994 |
2027 Term Loan A | 1,152 |  | 1,149 |  | 1,149 |
2028 Notes | 600 |  | 596 |  | 596 |
2029 B Notes | 1,250 |  | 1,264 |  | 1,264 |
2033 A Notes | 750 |  | 745 |  | 745 |
2033 B Notes | 900 |  | 890 |  | 890 |
Prepayments |  |  |
2024 Term Loan A | (600) |  | (600) |  | (600) |
| $ | 6,100 |  | $ | 6,088 |  | $ | 6,088 |
Term Loan Agreement On November 3, 2022, we entered into a term loan agreement consisting of three tranches and borrowed $2.60 billion in aggregate principal amount, including $927 million due November 3, 2025; $746 million due November 3, 2026; and $927 million due November 3, 2027 (the “Term Loan Agreement”). We incurred aggregate fees of $6 million in connection with these borrowings. On January 5, 2023, we amended the Term Loan Agreement and borrowed an additional $600 million in aggregate principal amount, including $125 million due November 3, 2025, $250 million due November 3, 2026, and $225 million due November 3, 2027. The additional borrowings have terms that are identical to, and will be treated as a single class with, the three original tranches. The 2026 Term Loan A and 2027 Term Loan A each require equal quarterly installment payments in an amount equal to 1.25% of the original principal amount. The 2025 Term Loan A does not require quarterly installment payments. Borrowings under the Term Loan Agreement will generally bear interest at adjusted term SOFR plus an applicable interest rate margin ranging from 1.00% to 2.00%, varying by tranche and depending on our corporate credit ratings. Adjusted term SOFR for the Term Loan Agreement is the SOFR benchmark plus 0.10%. The Term Loan Agreement requires us to maintain, on a consolidated basis, a leverage ratio of total indebtedness to adjusted EBITDA, as defined in the Term Loan Agreement and calculated as of the last day of each fiscal quarter, not to exceed 3.25 to 1.00, except as described below. On March 27, 2023, we further amended the Term Loan Agreement to provide that in lieu of the foregoing leverage ratio, during the fourth quarter of 2023 and each quarter of 2024, we will be required to maintain, on a consolidated basis, a net leverage ratio of total net indebtedness to adjusted EBITDA, as defined in the Term Loan Agreement and calculated as of the last day of each fiscal quarter, not to exceed 3.25 to 1.00, or alternatively, for up to three of such five quarters, we may elect to comply with a requirement of minimum liquidity, as defined in the Term Loan Agreement, of not less than $5.0 billion. Each of the leverage ratio and net leverage ratio maximums, as applicable, is subject to a temporary four quarter increase in such ratio to 3.75 to 1.00 following certain material acquisitions. Our obligations under the Term Loan Agreement are unsecured. 2024 Term Loan A On March 27, 2023, we also amended the agreement governing the 2024 Term Loan A to align the leverage ratio covenant with the corresponding covenant in the Term Loan Agreement described above. On April 13, 2023, we used a portion of the proceeds from our April 11, 2023 issuance of senior unsecured notes to prepay $600 million principal amount of our 2024 Term Loan A. On June 7, 2023, the 2024 Term Loan A agreement was amended, pursuant to its transition provisions, to replace LIBOR-based benchmark rates with SOFR-based benchmark rates effective July 1, 2023. After giving effect to this amendment, borrowings under the 2024 Term Loan A will generally bear interest at adjusted term SOFR plus an applicable interest rate margin ranging from 0.625% to 1.375% depending on our corporate credit ratings. Adjusted term SOFR for the 2024 Term Loan A is the SOFR benchmark plus a credit spread adjustment ranging from approximately 0.11% to 0.43% depending on the applicable interest period selected. Senior Unsecured Notes On October 31, 2022, we issued $750 million principal amount of senior unsecured 2029 B Notes. The 2029 B Notes bear interest at a rate of 6.750% per year and will mature on November 1, 2029. Aggregate issuance costs and debt discount for these notes were $6 million. On February 9, 2023, we issued an additional $500 million principal amount of 2029 B Notes at a $22 million premium. The additional notes have terms that are identical to the terms of the original 2029 B Notes other than the original offering price. Also on February 9, 2023, we issued $750 million principal amount of senior unsecured 2033 A Notes. The 2033 A Notes bear interest at a rate of 5.875% per year and will mature on February 9, 2033. Aggregate issuance costs for these notes were $7 million. On April 11, 2023, we issued $600 million principal amount of senior unsecured 2028 Notes and $900 million principal amount of senior unsecured 2033 B Notes. The 2028 Notes bear interest at a rate of 5.375% per year and will mature on April 15, 2028. The 2033 B Notes bear interest at a rate of 5.875% per year and will mature on September 15, 2033. Aggregate issuance costs and debt discount for these notes were $14 million. We may redeem the 2028 Notes, the 2029 B Notes, the 2033 A Notes, and the 2033 B Notes (the “Notes”), in whole or in part, at our option prior to their maturity dates at a redemption price equal to the greater of (i) 100% of the principal amount of the notes to be redeemed and (ii) the present value of the remaining scheduled payments of principal and interest, plus accrued interest in each case. We may also redeem the Notes, in whole or in part, at a price equal to par either one, two, or three months prior to maturity in accordance with the terms of the Notes. The Notes contain covenants that, among other things, limit, in certain circumstances, our ability and/or the ability of our restricted subsidiaries (which are generally domestic subsidiaries in which we own at least 80% of the voting stock and which own principal property, as defined in the indenture governing such notes) to (1) create or incur certain liens; (2) enter into certain sale and lease-back transactions; and (3) consolidate with or merge with or into, or convey, transfer, or lease all or substantially all of our properties and assets, to another entity. These covenants are subject to a number of limitations and exceptions. Additionally, if a change of control triggering event, as defined in the indenture governing the Notes, occurs with respect to a series of Notes, we will be required to offer to purchase such Notes at 101% of the outstanding aggregate principal amount plus accrued interest up to the purchase date. Revolving Credit Facility As of June 1, 2023, $2.50 billion was available to us under the Revolving Credit Facility and no amounts were outstanding. Any amounts outstanding under the Revolving Credit Facility would mature in May 2026 and amounts borrowed may be prepaid any time without penalty. Under the transition provisions of the Revolving Credit Facility agreement, after the retirement of LIBOR on June 30, 2023, any amounts drawn under the Revolving Credit Facility would generally bear interest at a rate equal to adjusted term SOFR plus 1.00% to 1.75%, depending on our corporate credit ratings. Adjusted term SOFR for the Revolving Credit Facility agreement is the SOFR benchmark plus a credit spread adjustment ranging from approximately 0.11% to 0.43% depending on the applicable interest period selected. On March 27, 2023, we amended the agreement governing the Revolving Credit Facility to align the leverage ratio covenant with the corresponding covenants in the Term Loan Agreement and 2024 Term Loan A described above. On June 7, 2023, the Revolving Credit Facility agreement was amended, pursuant to its transition provisions, to replace LIBOR-based benchmark rates with SOFR-based benchmark rates effective July 1, 2023. Maturities of Notes Payable As of June 1, 2023, maturities of notes payable by fiscal year were as follows:
Remainder of 2023 | $ | 27 |
2024 | 107 |
2025 | 695 |
2026 | 1,659 |
2027 | 1,780 |
2028 and thereafter | 7,942 |
Unamortized issuance costs, discounts, and premium, net | (35) |
Hedge accounting fair value adjustment | (101) |
| $ | 12,074 |

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI https://asc.fasb.org/topic&trid=2208564 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (h) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (c) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (g) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1E -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (i) -URI https://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 + Details
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