Annual report pursuant to Section 13 and 15(d)

Borrowings

v3.24.1.u1
Borrowings
 12 Months Ended
Feb. 29, 2024
Debt Disclosure [Abstract]  
BORROWINGS BORROWINGS
Borrowings consist of the following:
February 29, 2024 February 28,
2023
Current Long-term Total Total
(in millions)
Short-term borrowings
Commercial paper $ 241.4  $ 1,165.3 
$ 241.4  $ 1,165.3 
Long-term debt
Term loan credit facilities $ —  $ —  $ —  $ 799.2 
Senior notes 949.3  10,670.8  11,620.1  10,470.6 
Other 7.5  10.3  17.8  26.2 
$ 956.8  $ 10,681.1  $ 11,637.9  $ 11,296.0 
Bank facilities
In October 2022, the Company, CB International, the Administrative Agent, and certain other lenders agreed to amend the 2022 Credit Agreement. The October 2022 Credit Agreement Amendment revised certain defined terms and covenants and became effective in April 2024 following (i) the amendment by Canopy of its Articles of Incorporation, (ii) the conversion of our Canopy common shares into Exchangeable Shares, and (iii) the resignation of our nominees from the board of directors of Canopy.

Senior credit facility
In April 2022, the Company, CB International, the Administrative Agent, and certain other lenders entered into the 2022 Restatement Agreement that amended and restated our then-existing senior credit facility (as amended and restated by the 2022 Restatement Agreement, the 2022 Credit Agreement). The principal changes effected by the 2022 Restatement Agreement were the:

•refinance and increase of the existing revolving credit facility from $2.0 billion to $2.25 billion and extension of its maturity to April 14, 2027;
•refinement of certain negative covenants; and
•replacement of LIBOR rates with rates based on term SOFR.

April 2022 Term Credit Agreement
In June 2021, the Company and the Administrative Agent and Lender amended our then-existing term credit agreement (as amended, the June 2021 Term Credit Agreement). The April 2022 Term Credit Agreement provided for a $491.3 million five-year term loan facility. The principal change effected by the amendment was a reduction in LIBOR margin from 0.88% to 0.63% from June 1, 2021 through December 31, 2021.

In April 2022, the Company, the Administrative Agent, and the Lender amended the June 2021 Term Credit Agreement (as amended, the April 2022 Term Credit Agreement). The principal changes effected by the amendment were the refinement of certain negative covenants and replacement of LIBOR rates with rates based on term SOFR. In August 2023, we repaid the outstanding five-year term loan facility borrowings under the April 2022 Term Credit Agreement with proceeds from commercial paper borrowings.

August 2022 Term Credit Agreement
In August 2022, the Company, the Administrative Agent, and certain other lenders entered into the August 2022 Term Credit Agreement. The August 2022 Term Credit Agreement provided for a $1.0 billion term loan facility and was not subject to amortization payments, with the balance due and payable three years after the November 10, 2022, funding date. The proceeds from the August 2022 Term Credit Agreement were used to partially fund the aggregate cash payment to holders of Class B Stock in connection with the Reclassification and to pay related fees as well as fees related to closing the August 2022 Term Credit Agreement. In February 2023, we repaid a portion of our indebtedness under the August 2022 Term Credit Agreement with proceeds from the February 2023 Senior Notes. In May 2023, we repaid the remaining outstanding borrowings under the August 2022 Term Credit Agreement with proceeds from the May 2023 Senior Notes. For additional information, refer to “Senior notes” below.

General
We and our subsidiaries are subject to covenants that are contained in the 2022 Credit Agreement, including those restricting the incurrence of additional subsidiary indebtedness, additional liens, mergers and consolidations, transactions with affiliates, and sale and leaseback transactions, in each case subject to numerous conditions, exceptions, and thresholds. The financial covenants are limited to a minimum interest coverage ratio and a maximum net leverage ratio.

Our senior credit facility permits us to elect, subject to the willingness of existing or new lenders to fund such increase and other customary conditions, to increase the revolving credit commitments. The increased commitments may be an unlimited amount so long as our net leverage ratio, as defined and computed pursuant to our senior credit facility, is no greater than 4.00 to 1.00 subject to certain limitations for the period defined pursuant to our senior credit facility.
Information with respect to borrowings under the 2022 Credit Agreement is as follows:
Outstanding
borrowings		 Interest
rate		 SOFR
margin		 Outstanding
letters of
credit
Remaining
borrowing
capacity (1)
(in millions)
February 29, 2024
Revolving credit facility (2) (3)
$ —  —  % —  % $ 11.5  $ 1,997.0 
February 28, 2023
Revolving credit facility (2) (3)
$ —  —  % —  % $ 12.0  $ 1,068.5 
(1)Net of outstanding revolving credit facility borrowings and outstanding letters of credit under the 2022 Credit Agreement and outstanding borrowings under our commercial paper program of $241.5 million and $1,169.5 million (excluding unamortized discount) for the years ended February 29, 2024, and February 28, 2023, respectively (see “Commercial paper program” below).
(2)Contractual interest rate varies based on our debt rating (as defined in the agreement) and is a function of SOFR plus a margin and a credit spread adjustment, or the base rate plus a margin, or, in certain circumstances where SOFR cannot be adequately ascertained or available, an alternative benchmark rate plus a margin.
(3)We and/or CB International are the borrower under the $2,250.0 million revolving credit facility with a maturity date of April 14, 2027. Includes a sub-facility for letters of credit of up to $200.0 million.

Commercial paper program
We have a commercial paper program which provides for the issuance of up to an aggregate principal amount of $2.25 billion of commercial paper. Our commercial paper program is backed by unused commitments under our revolving credit facility under our 2022 Credit Agreement. Accordingly, outstanding borrowings under our commercial paper program reduce the amount available under our revolving credit facility. Information with respect to our outstanding commercial paper borrowings is as follows:
February 29,
2024		 February 28,
2023
(in millions)
Outstanding borrowings (1)
$ 241.4  $ 1,165.3 
Weighted average annual interest rate 5.7  % 5.3  %
Weighted average remaining term 4 days 25 days
(1)Outstanding commercial paper borrowings are net of unamortized discount.

Pre-issuance hedge contracts
We enter into cash flow designated Pre-issuance hedge contracts to hedge the interest rate volatility on future debt issuances. Upon the termination and settlement of these contracts, the unrealized gain (loss) is recognized in AOCI within our consolidated balance sheets and amortized to interest expense within our consolidated results of operations. We had no Pre-issuance hedge contracts outstanding as of February 29, 2024, or February 28, 2023.
Senior notes
Our outstanding senior notes are as follows:
Date of
Outstanding Balance (1)
Principal Issuance Maturity Interest
Payments		 February 29,
2024		 February 28,
2023
(in millions)
4.75% Senior Notes (2) (3)
$ 400.0  Nov 2014 Nov 2024 May/Nov $ 399.5  $ 398.9 
4.75% Senior Notes (2) (3)
$ 400.0  Dec 2015 Dec 2025 Jun/Dec 398.8  398.2 
3.70% Senior Notes (2) (4)
$ 600.0  Dec 2016 Dec 2026 Jun/Dec 598.3  597.7 
3.50% Senior Notes (2) (4)
$ 500.0  May 2017 May 2027 May/Nov 498.2  497.7 
4.50% Senior Notes (2) (4)
$ 500.0  May 2017 May 2047 May/Nov 493.9  493.6 
3.60% Senior Notes (2) (4)
$ 700.0  Feb 2018 Feb 2028 Feb/Aug 697.1  696.4 
4.10% Senior Notes (2) (4)
$ 600.0  Feb 2018 Feb 2048 Feb/Aug 593.2  592.9 
4.40% Senior Notes (2) (4)
$ 500.0  Oct 2018 Nov 2025 May/Nov 498.8  498.0 
4.65% Senior Notes (2) (4)
$ 500.0  Oct 2018 Nov 2028 May/Nov 497.3  496.8 
5.25% Senior Notes (2) (4)
$ 500.0  Oct 2018 Nov 2048 May/Nov 493.8  493.6 
3.15% Senior Notes (2) (4)
$ 800.0  Jul 2019 Aug 2029 Feb/Aug 796.1  795.4 
2.875% Senior Notes (2) (4)
$ 600.0  Apr 2020 May 2030 May/Nov 596.2  595.5 
3.75% Senior Notes (2) (4)
$ 600.0  Apr 2020 May 2050 May/Nov 590.6  590.3 
2.25% Senior Notes (2) (4)
$ 1,000.0  Jul 2021 Aug 2031 Feb/Aug 990.5  989.2 
3.60% Senior Notes (2) (5)
$ 550.0  May 2022 May 2024 May/Nov 549.8  548.5 
4.35% Senior Notes (2) (4)
$ 600.0  May 2022 May 2027 May/Nov 597.8  597.1 
4.75% Senior Notes (2) (4)
$ 700.0  May 2022 May 2032 May/Nov 694.4  693.7 
5.00% Senior Notes (2) (6)
$ 500.0  Feb 2023 Feb 2026 Feb/Aug 497.9  497.1 
4.90% Senior Notes (2) (4)
$ 750.0  May 2023 May 2033 May/Nov 740.7  — 
4.80% Senior Notes (2) (4)
$ 400.0  Jan 2024 Jan 2029
Jan/Jul
 397.2  — 
$ 11,620.1  $ 10,470.6 
(1)Amounts are net of unamortized debt issuance costs and unamortized discounts, where applicable.
(2)Senior unsecured obligations which rank equally in right of payment to all of our existing and future senior unsecured indebtedness.
(3)Redeemable, in whole or in part, at our option at any time at a redemption price equal to 100% of the outstanding principal amount, plus accrued and unpaid interest and a make-whole payment based on the present value of the future payments at the applicable treasury rate plus 50 basis points.
(4)Redeemable, in whole or in part, at our option at any time prior to the stated redemption date as defined in the indenture, at a redemption price equal to 100% of the outstanding principal amount, plus accrued and unpaid interest and a make-whole payment based on the present value of the future payments at the applicable treasury rate plus the stated basis points as defined in the indenture. On or after the stated redemption date, redeemable, in whole or in part, at our option at any time at a redemption price equal to 100% of the outstanding principal amount, plus accrued and unpaid interest.
Redemption
Stated
Redemption
Date		 Stated
Basis
Points
3.70% Senior Notes due December 2026
 Sept 2026 25
3.50% Senior Notes due May 2027
 Feb 2027 20
4.50% Senior Notes due May 2047
 Nov 2046 25
3.60% Senior Notes due February 2028
 Nov 2027 15
4.10% Senior Notes due February 2048
 Aug 2047 20
4.40% Senior Notes due November 2025
 Sept 2025 20
4.65% Senior Notes due November 2028
 Aug 2028 25
5.25% Senior Notes due November 2048
 May 2048 30
3.15% Senior Notes due August 2029
 May 2029 20
2.875% Senior Notes due May 2030
 Feb 2030 35
3.75% Senior Notes due May 2050
 Nov 2049 40
2.25% Senior Notes due August 2031
 May 2031 15
4.35% Senior Notes due May 2027
 Apr 2027 25
4.75% Senior Notes due May 2032
 Feb 2032 30
4.90% Senior Notes due May 2033
 Feb 2033 25
4.80% Senior Notes due January 2029
 Dec 2028 15
(5)Redeemable, in whole or in part, at our option at any time at a redemption price equal to 100% of the outstanding principal amount, plus accrued and unpaid interest and a make-whole payment based on the present value of the future payments at the applicable treasury rate plus 15 basis points.
(6)Redeemable, in whole or in part, at our option at any time at a redemption price equal to 100% of the outstanding principal amount, plus accrued and unpaid interest.

Indentures
Our indentures relating to our outstanding senior notes contain certain covenants, including, but not limited to: (i) a limitation on liens on certain assets, (ii) a limitation on certain sale and leaseback transactions, and (iii) restrictions on mergers, consolidations, and the transfer of all or substantially all of our assets to another person.

Subsidiary credit facilities
General
We have additional credit arrangements totaling $67.7 million and $73.5 million as of February 29, 2024, and February 28, 2023, respectively. As of February 29, 2024, and February 28, 2023, amounts outstanding under these arrangements were $17.8 million and $26.2 million, respectively, the majority of which is classified as long-term as of the respective date. These arrangements primarily support the financing needs of our domestic and foreign subsidiary operations. Interest rates and other terms of these borrowings vary from country to country, depending on local market conditions.
Debt payments
As of February 29, 2024, the required principal repayments under long-term debt obligations (excluding unamortized debt issuance costs and unamortized discounts of $56.4 million and $23.5 million, respectively) for each of the five succeeding fiscal years and thereafter are as follows:
(in millions)
Fiscal 2025 $ 957.5 
Fiscal 2026 1,404.9 
Fiscal 2027 603.8 
Fiscal 2028 1,801.5 
Fiscal 2029 900.0 
Thereafter 6,050.1 
$ 11,717.8