Toro 2014 Annual Report Download - page 64

notes at a price equal to 101% of the principal amount of the
senior notes plus accrued and unpaid interest to the date of
7LONG-TERM DEBT repurchase.
In connection with the issuance in June 1997 of $175,000 in
A summary of long-term debt as of October 31 is as follows: long-term debt securities, the company paid $23,688 to terminate
three forward-starting interest rate swap agreements with notional
2014 2013 amounts totaling $125,000. These swap agreements had been
Term loan, due October 25, 2019 $130,000 $– entered into to reduce exposure to interest rate risk prior to the
7.800% Debentures, due June 15, 2027 100,000 100,000 issuance of the new long-term debt securities. As of the inception
6.625% Senior Notes, due May 1, 2037 123,606 123,544 of one of the swap agreements, the company had received pay-
Other 350 –
ments that were recorded as deferred income to be recognized as
Total long-term debt 353,956 223,544 an adjustment to interest expense over the term of the new debt
Less current portion 6,640 –
securities. As of the date the swaps were terminated, this deferred
Long-term debt, less current portion $347,316 $223,544 income totaled $18,710. The excess termination fees over the
deferred income recorded has been deferred and is being recog-
In October 2014, the company obtained a $130,000 term loan
nized as an adjustment to interest expense over the term of the
with various banks, which was a part of the new credit agreement
debt securities issued. As of October 31, 2014, the company had
that included the new revolving credit facility. Under the credit
$1,995 remaining in other assets for the excess termination fees
agreement, the term loan bears interest based on a LIBOR rate (or
over deferred income.
other rates quoted by the Administrative Agent, Bank of America,
Principal payments required on long-term debt in each of the
N.A.) plus a basis point spread defined in the credit agreement.
next five fiscal years ending October 31 are as follows: 2015,
The term loan can be repaid in part or in full at any time without
$6,640; 2016, $13,140; 2017, $13,070; 2018, $13,000; 2019,
penalty, but in any event must be paid in full by October 2019.
$84,500; and after 2019, $225,000.
On April 26, 2007, the company issued $125,000 in aggregate
principal amount of 6.625% senior notes due May 1, 2037. The
senior notes were priced at 98.513% of par value, and the result-
ing discount of $1,859 associated with the issuance of these senior 8STOCKHOLDERS’ EQUITY
notes is being amortized over the term of the notes using the
effective interest rate method. The underwriting fee and direct debt Common Shares Authorized. On March 12, 2013, following the
issue costs totaling $1,524 will be amortized over the life of the approval by the company’s shareholders at its 2013 annual meet-
notes. Although the coupon rate of the senior notes is 6.625%, the ing of shareholders, the company amended its Restated Certificate
effective interest rate is 6.741% after taking into account the issu- of Incorporation by filing a Certificate of Amendment to Restated
ance discount. Interest on the senior notes is payable Certificate of Incorporation to increase the number of authorized
semi-annually on May 1 and November 1 of each year. The senior shares from 100 million to 175 million.
notes are unsecured senior obligations of the company and rank Stock Repurchase Program. On December 11, 2012, the com-
equally with the company’s other unsecured and unsubordinated pany’s Board of Directors authorized the repurchase of 5 million
indebtedness. The indentures under which the senior notes were shares of the company’s common stock in open-market or in pri-
issued contain customary covenants and event of default provi- vately negotiated transactions. This program has no expiration date
sions. The company may redeem some or all of the senior notes but may be terminated by the Board at any time. During fiscal
at any time at the greater of the full principal amount of the senior 2014, 2013, and 2012, the company paid $101,674, $98,842, and
notes being redeemed or the present value of the remaining $92,719 to repurchase an aggregate of 1,622,569 shares,
scheduled payments of principal and interest discounted to the 2,131,615 shares, and 2,591,039 shares, respectively. As of Octo-
redemption date on a semi-annual basis at the treasury rate plus ber 31, 2014, 2,720,493 shares remained authorized for
30 basis points, plus, in both cases, accrued and unpaid interest. repurchase.
In the event of the occurrence of both (i) a change of control of the
company, and (ii) a downgrade of the notes below an investment Treasury Shares. As of October 31, 2014, the company had
grade rating by both Moody’s Investors Service, Inc. and Stan- 22,386,021 treasury shares at a cost of $1,163,706. As of Octo-
dard & Poor’s Ratings Services within a specified period, the com- ber 31, 2013, the company had 21,275,717 treasury shares at a
pany would be required to make an offer to purchase the senior cost of $1,081,086.
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