The Company’s long-term debt consists of the following:


(in thousands)	February 28, 2023
Term Loan	$	550,000
Senior Notes		350,000
Total long-term debt		900,000
Less: Unamortized debt issuance costs		(15,299	)
Total non-current debt, net	$	884,701

The Company had a financing agreement with a bank providing for a $15.0 million unsecured revolving line of credit, which originally expired on November 30, 2023, but was replaced by the five-year senior secured revolving facility as part of the Credit Facilities described below. There were no advances against the line of credit during fiscal 2022 and there were no advances in fiscal 2023 before the line of credit was extinguished. Interest on any borrowings under that agreement was at LIBOR plus 100 basis points. Financial covenants included maintaining specified levels of tangible net worth, debt service coverage, and funded debt to EBITDA, each of which the Company was in compliance with during the period the line of credit was available.

As of May 31, 2022, the Company had no outstanding debt. In connection with the acquisition of 3M’s Food Safety business as described more fully in Note 8, Neogen incurred financing through Garden SpinCo as follows:

On June 30, 2022, Garden SpinCo entered into a credit agreement consisting of a five-year senior secured term loan facility (“term loan facility”) in the amount of $650 million and a five-year senior secured revolving facility (“revolving facility”) in the amount of $150 million (collectively, the “Credit Facilities”) to fund the 3M Food Safety transaction. The term loan facility was drawn on August 31, 2022, to fund the closing of the 3M Food Safety transaction on September 1, 2022 while the revolving facility remained undrawn and continues to be undrawn as of February 28, 2023.

The Credit Facilities bear interest based on the term SOFR plus an applicable margin between a range of 150 to 225 basis points determined for each interest period and paid monthly. During the three and nine months ended February 28, 2023, the interest rates ranged from 6.48% to 6.66% per annum and 4.80% to 6.66% per annum, respectively. The term loan facility matures on June 30, 2027 and the revolving facility matures at the earlier of June 30, 2027 and the termination of the revolving commitments. In November 2022, the Company entered into an interest rate swap agreement, whereby interest on $250 million of the total $550 million principal balance is paid at a fixed rate. See Note 13. "Derivatives" for further detail on the swap agreement.

The term loan facility contains an optional prepayment feature at the discretion of the Company. The Company determined that the prepayment feature did not meet the definition of an embedded derivative and does not require bifurcation from the host liability and, accordingly, has accounted for the entire instrument at amortized cost. In accordance with the prepayment feature, the Company paid $60 million of the term loan facility’s principal in September 2022 and an additional $40 million of the term loan facility's principal in December 2022, in order to decrease the outstanding debt balance.

The Company can draw any amount under the revolving facility up to the $150 million limit, with the amount to be repaid on the termination date of the revolving commitments. Debt issuance costs of $2.4 million were incurred related to the revolving facility. These costs are being amortized as interest expense in the condensed consolidated statements of income (loss) over the contractual life of the revolving facility using the straight line method. Amortization of the deferred debt issuance costs for the revolving facility was $122,000 and $244,000 during the three and nine months ended February 28, 2023, respectively. Debt issuance costs of $489,000 were recorded in Prepaid expenses and other current assets and $1.6 million were recorded in Other non-current assets on the condensed consolidated balance sheet as of February 28, 2023. The Company must pay an annual commitment fee ranging from 0.20% and 0.35% on the unused portion of the Revolving Credit Facility, paid quarterly. As of February 28, 2023, the commitment fee was 0.35% and $131,000 and $356,000 was recorded as interest expense in the condensed consolidated statements of income (loss) during the three and nine months ended February 28, 2023, respectively.

There was no accrued interest payable on the term loan as of February 28, 2023. The Company incurred $10.2 million in total debt issuance costs on the term loan which is recorded as an offset to the term loan facility and amortized over the contractual life of the loan to interest expense using the straight line method. The amortization of deferred debt issuance costs of $529,000 and $1.1 million and interest expense of $9.1 million and $17.4 million (excluding swap credit of $136,000) for the term loan was included in the condensed consolidated statements of income (loss) during the three and nine months ended February 28, 2023, respectively.

Financial covenants include maintaining specified levels of funded debt to EBITDA, and debt service coverage. As of February 28, 2023, the Company was in compliance with its debt covenants.

On July 20, 2022, Garden SpinCo closed on an offering of $350 million aggregate principal amount of 8.625% senior notes due 2030 (the “Notes”) in a private placement at par. The Notes were initially issued by Garden SpinCo to 3M and were transferred and delivered by 3M to the selling securityholder in the offering, in satisfaction of certain of 3M’s existing debt. Upon closing of the 3M Food Safety transaction on September 1, 2022, the Notes became guaranteed on a senior unsecured basis by the Company and certain wholly-owned domestic subsidiaries of the Company.

The Company determined that the redemption features of the Notes did not meet the definition of a derivative and thus does not require bifurcation from the host liability and accordingly has accounted for the entire instrument at amortized cost.

Total accrued interest on the Notes was $3.4 million as of February 28, 2023 based on the stated interest rate of 8.625% and included in current liabilities on the condensed consolidated balance sheets. The Company incurred total debt issuance costs of $6.7 million which is recorded as an offset to the Notes and amortized over the contractual life of the Notes to interest expense using the straight line method. During the three and nine months ended February 28, 2023, the Company recorded $7.8 million and $19.1 million of interest expense for the Notes in the condensed consolidated statements of income (loss), of which $209,000 and $557,000 related to the amortization of deferred debt issuance costs, respectively.

There are no required principal payments through fiscal year 2026, due to $100 million in prepayments made in fiscal 2023.The expected maturities associated with the Company’s outstanding debt as of February 28, 2023, were as follows:


(in thousands)	Amount
Fiscal Year
Remainder of 2023	$	—
2024		—
2025		—
2026		—
2027		34,063
Thereafter		865,937
Total	$	900,000