Fair Value of Financial Instruments and Long-Term Debt

12 Months Ended

Apr. 30, 2011

Fair Value of Financial Instruments and Long-Term Debt

Fair Value of Financial Instruments and Long-Term Debt

3. FAIR VALUE OF FINANCIAL INSTRUMENTS AND LONG-TERM DEBT

A summary of the fair value of the Company's financial instruments follows.

Cash and cash equivalents, receivables, and accounts payable The carrying amount approximates fair value due to the short maturity of these instruments or the recent purchase of the instruments at current rates of interest.

Long-term debt The fair value of the Company's long-term debt excluding capital lease obligations is estimated based on the current rates offered to the Company for debt of the same or similar issues. The fair value of the Company's long-term debt excluding capital lease obligations was approximately $636,000 and $161,000, respectively, at April 30, 2011 and 2010. The Company had a $50,000 line of credit with $600 owed at April 30, 2011 with a weighted average interest rate of 0.85% and no balance owed at April 30, 2010.

On May 23, 2011 the Company replaced the current line of credit arrangements with two Promissory Notes, each in the principal amount of $50,000 (together, the "Notes"). The Notes evidence a revolving line of credit in the aggregate principal amount of $100,000 and bear interest at variable rates subject to change from time to time based on changes in an independent index referred to in the Notes as the Federal Funds Offered Rate (the "Index"). The interest rate to be applied to the unpaid principal balance of the first Note will be at a rate of 0.750% over the Index, resulting in an initial rate of 0.850% per annum. The interest rate applicable to the second note is 1.000% over the Index, resulting in an initial rate of 1.100% per annum.

Interest expense is net of interest income of $360, $300, and $2,107 for the years ended April 30, 2011, 2010, and 2009, respectively. Interest expense in the amount of $406, $431, and $367 was capitalized during the years ended April 30, 2011, 2010, and 2009, respectively.

The next table delineates the Company's long-term debt at carrying amount.

		As of April 30,
		2011	2010
Capitalized lease obligations discounted at 5.22% to 7.09% due in various monthly installments through 2048 (Note 7)	$	10,344	10,274

Mortgage notes payable due in various installments through January 2013 with interest at 6%		503	10,628

7.38% senior notes due in 21 semi-annual installments beginning in December 2010—paid August 2010		--------	30,000

Senior notes due in various installments from 2004 through 2019 with interest at 6.18% to 7.23%—paid August 2010		--------	17,000

7.89% senior notes due in 7 annual installments beginning in May 2004		--------	11,429

5.72% senior notes due in 14 installments beginning September 30, 2012 and ending March 30, 2020		100,000	100,000

5.22% senior notes due August 9, 2020		569,000	--------
		679,847	179,331

Less current maturities		1,167	24,577

	$	678,680	154,754

Various debt agreements contain certain operating and financial covenants. At April 30, 2011, the Company was in compliance with all covenants. Listed below are the aggregate maturities of long-term debt, including capitalized lease obligations, for the 5 years commencing May 1, 2011 and thereafter:

Years ended April 30,
2012	$	1,167
2013		10,707
2014		15,728
2015		406
2016		15,244
Thereafter		636,595
	$	679,847

- Definition

This item represents the complete disclosure regarding the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the Company is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risk is are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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