Fair Value of Financial Instruments and Long-Term Debt | FAIR VALUE OF FINANCIAL INSTRUMENTS AND LONG-TERM DEBT U.S. GAAP requires that each financial asset and liability carried at fair value be classified into one of the following of the fair value hierarchy levels, which is based upon the quality of the inputs used in the valuation. Level 1 inputs are quoted market prices in active markets for identical assets and liabilities. Level 2 inputs are observable market based inputs or unobservable inputs that are corroborated by market data (excluding those included within Level 1). Level 3 inputs are unobservable inputs that are not corroborated by market data. The Company has not changed its valuation techniques in measuring the fair value of any financial assets and liabilities during the period. 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 and finance lease obligations: The fair value of the Company’s long-term debt and finance lease obligations (including current maturities) 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 and capital lease obligations was approximately $1,408,000 and $1,341,000, respectively, at April 30, 2021 and 2020. The carrying amount of the Company’s long-term debt and finance lease obligations by issuance is as follows: As of April 30, 2021 2020 Finance lease liabilities (Note 7) $ 14,085 $ 16,746 5.22% Senior notes due August 9, 2020 $ — 569,000 3.67% Senior notes (Series A) due in 7 installments beginning June 17, 2022, and ending June 15, 2028 150,000 150,000 3.75% Senior notes (Series B) due in 7 installments beginning December 17, 2022 and ending December 18, 2028 50,000 50,000 3.65% Senior notes (Series C) due in 7 installments beginning May 2, 2025 and ending May 2, 2031 50,000 50,000 3.72% Senior notes (Series D) due in 7 installments beginning October 28, 2025 and ending October 28, 2031 50,000 50,000 3.51% Senior notes (Series E) due June 13, 2025 150,000 150,000 3.77% Senior notes (Series F) due August 22, 2028 250,000 250,000 2.85% Senior notes (Series G) due August 7, 2030 325,000 — 2.96% Senior notes (Series H) due August 6, 2032 325,000 — Debt issuance costs (336) — 1,363,749 1,285,746 Less current maturities (1) 2,354 571,244 $ 1,361,395 $ 714,502 (1) Current maturities is presented gross in the table above, but net of unamortized debt issuance costs of $964 on the consolidated balance sheets for the year ended April 30, 2020. Interest expense is net of interest income of $168, $860, and $595 for the years ended April 30, 2021, 2020, and 2019, respectively. Interest expense is also net of interest capitalized of $4,537, $5,258, and $3,057 during the years ended April 30, 2021, 2020, and 2019, respectively. The agreements relating to the above long-term debt contain certain operating and financial covenants. At April 30, 2021, the Company was in compliance with all such operating and financial covenants. Listed below are the aggregate maturities of long-term debt, including finance lease obligations, for the 5 years commencing May 1, 2021 and thereafter: Years ended April 30, Finance Leases Senior Notes Total 2022 $ 2,354 $ — $ 2,354 2023 2,484 20,000 22,484 2024 2,060 32,000 34,060 2025 734 32,000 32,734 2026 471 192,000 192,471 Thereafter 5,982 1,074,000 1,079,982 $ 14,085 $ 1,350,000 $ 1,364,085 Senior Notes On June 30, 2020, the Company entered into a note purchase agreement with respect to the issuance of $650,000 aggregate principal amount of senior notes, consisting of: (i) $325,000 aggregate principal amount of 2.85% Senior Notes, Series G (the “Series G Notes”); and (ii) $325,000 aggregate principal amount of 2.96% Senior Notes, Series H (the “Series H Notes”) (collectively, the “Notes”). The Notes were issued on August 7, 2020. The Series G Notes bear interest at the rate of 2.85% per annum, payable semi-annually on February 7 and August 7 of each year, and mature on August 7, 2030. The Series H Notes bear interest at the rate of 2.96% per annum, payable semi-annually on February 7 and August 7 of each year, and mature on August 6, 2032. The Company used a portion of the proceeds of the Notes to pay off the $569,000 5.22% senior notes that matured on August 9, 2020. Bridge Loan On November 8, 2020, the Company entered into a commitment letter (“Commitment Letter”) with Goldman Sachs Bank USA (“Goldman”), pursuant to which Goldman committed to lend the Company up to $100 million under a new senior unsecured 364-day bridge loan facility (the “Bridge Loan”). As a result of, and concurrent with the effectiveness of the second amendment of the Credit Agreement discussed below, the commitments under the Commitment Letter were reduced, and are now expired, in accordance with the terms thereof. Credit Agreement As noted above, on December 23, 2020, the Company entered into a second amendment (“the Amendment”) to its existing credit agreement dated January 11, 2019, as amended June 30, 2020 (together with the Amendment, the “Credit Agreement”) to: (a) increase the revolving commitments thereunder to an aggregate principal amount of $450 million (the “Revolving Facility Increase”, and together with the existing revolving commitments the “Revolving Facility”); and (b) provide for a senior unsecured delayed-draw term loan facility in an aggregate principal amount of up to $300 million (the “Term Loan Facility”). Revolving Facility Increase : The Amendment increased the total borrowing capacity under the Revolving Facility by an aggregate principal amount of $150 million, from $300 million to $450 million. The maturity date of the Revolving Facility remains unchanged, at January 11, 2024. Amounts borrowed under the Revolving Facility bear interest at variable rates based upon, at the Company’s option, either: (a) the LIBO Rate adjusted for statutory reserve requirements (but no less than 0.75%) (the “Adjusted LIBO Rate”), plus a margin ranging from 1.05% to 1.85%; or (b) an alternate base rate, which is the higher of (i) the prime rate announced by the Administrative Agent, (ii) the federal funds rate plus 1/2 of 1.00%, and (iii) the one-month LIBO Rate plus 1.00% (as applicable, the “ABR Rate”), plus a margin ranging from 0.05% to 0.85%. The Revolving Facility also carries a facility fee of 0.20% to 0.40% per annum. The applicable margins and facility fee are dependent upon the Company’s Consolidated Leverage Ratio, as calculated quarterly in accordance with the Credit Agreement (the “Consolidated Leverage Ratio”). The Company had $0 and $120,000 outstanding under the line of credit at April 30, 2021 and 2020, respectively. Term Loan Facility : The Amendment also provides for a new senior unsecured delayed-draw term loan facility in an aggregate principal amount of up to $300 million. The Term Loan Facility has a maturity date of January 6, 2026 (the “Term Loan Maturity Date”) and its proceeds may be used to finance the acquisition of Buchanan Energy (see additional discussion at Note 11), as well as working capital needs, capital expenditures, share repurchases and general corporate purposes. Amounts borrowed under the Term Loan Facility will bear interest at variable rates based upon, at the Company’s option, either: (i) the Adjusted LIBO Rate, plus a margin ranging from 1.55% to 2.60%; or (ii) the ABR Rate, plus a margin ranging from 0.20% to 1.60%. The Term Loan Facility also carries a facility fee of 0.20% to 0.40% per annum. The applicable margins and facility fee are dependent upon the Consolidated Leverage Ratio. The outstanding principal balance of the loan drawn on the Term Loan Facility is required to be repaid in equal quarterly installments in an amount equal to 1.25% of the original principal amount, on the last day of each March, June, September and December following its funding date, with the balance due on the Term Loan Maturity Date. The Company had not yet drawn on the Term Loan Facility as of April 30, 2021. Subsequent to fiscal 2021, the Company drew $300 million on the Term Loan Facility to partially fund the Buchanan Energy acquisition - refer to Note 11 for additional details. Bank Line |