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v3.20.4

Financing | 3 Months Ended
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Nov. 21, 2020
Financing |
Financing | Note G – Financing The Company’s long-term debt consisted of the following:
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | November 21, |  | August 29,
(in thousands) | ​ | 2020 | ​ | 2020
​ | ​ | ​ | ​ | ​ | ​ | ​
2.500% Senior Notes due April 2021, effective interest rate of 2.62% | ​ | $ | 250,000 | ​ | $ | 250,000
3.700% Senior Notes due April 2022, effective interest rate of 3.85% | ​ |  | 500,000 | ​ |  | 500,000
2.875% Senior Notes due January 2023, effective interest rate of 3.21% | ​ |  | 300,000 | ​ |  | 300,000
3.125% Senior Notes due July 2023, effective interest rate of 3.26% | ​ |  | 500,000 | ​ |  | 500,000
3.125% Senior Notes due April 2024, effective interest rate 3.32% | ​ |  | 300,000 | ​ |  | 300,000
3.250% Senior Notes due April 2025, effective interest rate 3.36% | ​ |  | 400,000 | ​ |  | 400,000
3.625% Senior Notes due April 2025, effective interest rate 3.78% | ​ | ​ | 500,000 | ​ | ​ | 500,000
3.125% Senior Notes due April 2026, effective interest rate of 3.28% | ​ |  | 400,000 | ​ |  | 400,000
3.750% Senior Notes due June 2027, effective interest rate of 3.83% | ​ |  | 600,000 | ​ |  | 600,000
3.750% Senior Notes due April 2029, effective interest rate of 3.86% | ​ |  | 450,000 | ​ |  | 450,000
4.000% Senior Notes due April 2030, effective interest rate 4.09% | ​ | ​ | 750,000 | ​ | ​ | 750,000
1.650% Senior Notes due January 2031, effective interest rate of 2.19% | ​ | ​ | 600,000 | ​ | ​ | 600,000
Total debt before discounts and debt issuance costs | ​ |  | 5,550,000 | ​ |  | 5,550,000
Less: Discounts and debt issuance costs | ​ |  | 35,126 | ​ |  | 36,629
Long-term debt | ​ | $ | 5,514,874 | ​ | $ | 5,513,371
​ As of November 21, 2020, the $250 million 2.500% Senior Notes due April 2021 are classified as long-term in the accompanying Condensed Consolidated Balance Sheets as the Company has the ability and intent to refinance them on a long-term basis through available capacity in its revolving credit agreements. As of November 21, 2020, the Company had $2.748 billion of availability under its $2.750 billion revolving credit agreements, which would allow the Company to replace these short-term obligations with long-term financing facilities. The Company entered into a Master Extension, New Commitment and Amendment Agreement dated as of November 18, 2017 (the “Extension Amendment”) to the Third Amended and Restated Credit Agreement dated as of November 18, 2016, as amended, modified, extended or restated from time to time (the “Revolving Credit Agreement”). Under the Extension Amendment: (i) the Company’s borrowing capacity under the Revolving Credit Agreement was increased from $1.6 billion to $2.0 billion; (ii) the maximum borrowing under the Revolving Credit Agreement may, at the Company’s option, subject to lenders approval, be increased from $2.0 billion to $2.4 billion; (iii) the termination date of the Revolving Credit Agreement was extended from November 18, 2021 until November 18, 2022; and (iv) the Company has the option to make one additional written request of the lenders to extend the termination date then in effect for an additional year. Under the Revolving Credit Agreement, the Company may borrow funds consisting of Eurodollar loans, base rate loans or a combination of both. Interest accrues on Eurodollar loans at a defined Eurodollar rate, defined as LIBOR plus the applicable percentage, as defined in the Revolving Credit Agreement, depending upon the Company’s senior, unsecured, (non-credit enhanced) long-term debt ratings. Interest accrues on base rate loans as defined in the Revolving Credit Agreement. On April 3, 2020, the Company entered into a 364-Day Credit Agreement (the “364-Day Credit Agreement”) to augment the Company’s access to liquidity due to current macroeconomic conditions, specifically the pandemic, and to supplement the Company’s existing Revolving Credit Agreement. The 364-Day Credit Agreement provides for loans in the aggregate principal amount of up to $750 million. The 364-Day Credit Agreement will terminate, and all amounts borrowed under the 364-Day Credit Agreement will be due and payable, on April 2, 2021. Revolving loans under the 364-Day Credit Agreement may be base rate loans, Eurodollar loans, or a combination of both, at the Company’s election. As of November 21, 2020, the Company had no outstanding borrowings under either of the revolving credit agreements and $1.7 million of outstanding letters of credit under the Revolving Credit Agreement. Under the Company’s revolving credit agreements, covenants include restrictions on liens, a maximum debt to earnings ratio, a minimum fixed charge coverage ratio and a change of control provision that may require acceleration of the repayment obligations under certain circumstances. The fair value of the Company’s debt was estimated at $6.055 billion as of November 21, 2020, and $6.081 billion as of August 29, 2020, based on the quoted market prices for the same or similar issues or on the current rates available to the Company for debt of the same terms (Level 2). Such fair value is greater than the carrying value of debt by $540.1 million and $567.5 million at November 21, 2020 and August 29, 2020, respectively, which reflects their face amount, adjusted for any unamortized debt issuance costs and discounts. All Senior Notes are subject to an interest rate adjustment if the debt ratings assigned are downgraded (as defined in the agreements). Further, the Senior Notes contain a provision that repayment may be accelerated if the Company experiences a change in control (as defined in the agreements). The Company’s borrowings under its Senior Notes contain minimal covenants, primarily restrictions on liens, sale and leaseback transactions and consolidations, mergers and the sale of assets. All of the repayment obligations under its borrowing arrangements may be accelerated and come due prior to the scheduled payment date if covenants are breached or an event of default occurs. As of November 21, 2020, the Company was in compliance with all covenants and expects to remain in compliance with all covenants under its borrowing arrangements.

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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 http://asc.fasb.org/topic&trid=2208564 + Details
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