HR Block 2005 Annual Report Download - page 127

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NOTE 10: LONG-TERM DEBT
The components of long-term debt and capital lease obligations short-term borrowings that initially funded the acquisition of
are as follows: OLDE Financial Corporation and Financial Marketing
(in 000s) Services, Inc.
April 30, 2005 2004 On October 21, 1997, we issued $250.0 million of 63/4% Senior
Notes under a shelf registration statement. The Senior Notes
Senior Notes, 81/2%, due April 2007 $ 498,825 $ 498,225
Senior Notes, 5.125%, due October 2014 397,766 –were due November 1, 2004, and the net proceeds were used to
Business Services acquisition obligations, repay short-term borrowings, which initially funded the
due from May 2005 to January 2008 38,022 60,768 acquisition of Option One.
Capital lease obligations 13,550 12,512 We have obligations related to Business Services acquisitions
Other obligations 455 –of $38.0 million and $60.8 million at April 30, 2005 and 2004,
Senior Notes, 63/4%, due November 2004 –249,975 respectively. The current portion of these amounts is included in
948,618 821,480 the current portion of long-term debt on the consolidated balance
Less: Current portion 25,545 275,669 sheet. The long-term portions are due from May 2006 to
$ 923,073 $ 545,811 January 2008.
On October 26, 2004, we issued $400.0 million of 5.125% Senior We have a capitalized lease obligation of $13.6 million at
Notes under a shelf registration statement. The Senior Notes are April 30, 2005 that is collateralized by land and buildings. The
due October 30, 2014, and are not redeemable by the bondholders obligation is due in 16 years.
prior to maturity. The net proceeds of this transaction were used The aggregate payments required to retire long-term debt are
to repay the $250.0 million in 63/4% Senior Notes. The remaining $25.5 million, $511.5 million, $1.0 million, $0.5 million, $0.6 million
proceeds were used for working capital, capital expenditures, and $409.5 million in 2006, 2007, 2008, 2009, 2010 and
repayment of other debt and other general corporate purposes. beyond, respectively.
On April 13, 2000, we issued $500.0 million of 81/2% Senior Notes Based upon borrowing rates currently available for
under a shelf registration statement. The Senior Notes are due indebtedness with similar terms, the fair value of long-term debt
April 15, 2007, and are not redeemable prior to maturity. The net was approximately $981.8 million and $893.5 million at April 30,
proceeds of this transaction were used to repay a portion of the 2005 and 2004, respectively.
NOTE 11: OTHER NONCURRENT LIABILITIES
We have deferred compensation plans that permit directors and We have recorded $213.4 million and $178.7 million for
certain employees to defer portions of their compensation and obligations to certain government agencies at April 30, 2005 and
accrue income on the deferred amounts. Their deferred 2004, respectively.
compensation and our matching amounts have been accrued. In connection with our acquisition of the non-attest assets of
Included in other noncurrent liabilities are $115.4 million and McGladrey & Pullen, LLP (‘‘M&P’’) in August 1999, we assumed
$93.4 million at April 30, 2005 and 2004, respectively, reflecting certain pension liabilities related to M&P’s retired partners. We
the liability under these plans. We purchase whole-life insurance make payments in varying amounts on a monthly basis. Included
contracts on certain director and employee participants to in other noncurrent liabilities at April 30, 2005 and 2004 are
recover distributions made or to be made under the plans and $15.9 million and $17.5 million, respectively, related to
record the cash surrender value of the policies in other this liability.
noncurrent assets.
NOTE 12: STOCKHOLDERS’ EQUITY
We are authorized to issue 6.0 million shares of Preferred Stock, On March 8, 1995, our Board of Directors authorized the
without par value. At April 30, 2005, we had 5.6 million shares of issuance of a series of 0.5 million shares of nonvoting Preferred
authorized but unissued Preferred Stock. Of the unissued shares, Stock designated as Convertible Preferred Stock, without par
0.6 million shares have been designated as Participating Preferred value. In April 1995, 0.4 million shares of Convertible Preferred
Stock in connection with our shareholder rights plan. Stock were issued in connection with an acquisition. In addition,
H&R BLOCK 2005 Form 10K
65