CREDIT FACILITIES AND BORROWINGS

12 Months Ended

May 26, 2019

Debt Disclosure [Abstract]

CREDIT FACILITIES AND BORROWINGS

CREDIT FACILITIES AND BORROWINGS

At May 26, 2019, we had a revolving credit facility (the "Revolving Credit Facility") with a syndicate of financial institutions providing for a maximum aggregate principal amount outstanding at any one time of $1.6 billion (subject to increase to a maximum aggregate principal amount of $2.1 billion with the consent of the lenders). The Revolving Credit Facility matures on July 11, 2024 and is unsecured. The term of the Revolving Credit Facility may be extended for additional one-year or two-year periods from the then-applicable maturity date on an annual basis. In the fourth quarter of fiscal 2019, the Company entered into an amendment to extend the existing termination date under the Revolving Credit Facility for one additional year, effective July 11, 2019. As of May 26, 2019, there were no outstanding borrowings under the Revolving Credit Facility. 

The Revolving Credit Facility contains events of default customary for unsecured investment grade credit facilities with corresponding grace periods. The Revolving Credit Facility contains customary affirmative and negative covenants for unsecured investment grade credit facilities of this type. It generally requires our ratio of EBITDA to interest expense not to be less than 3.0 to 1.0 and our ratio of funded debt to EBITDA not to exceed certain decreasing specified levels, ranging from 5.875 through the first quarter of fiscal 2020 to 3.75 from the second quarter of fiscal 2023 and thereafter, with each ratio to be calculated on a rolling four-quarter basis. As of May 26, 2019, we were in compliance with all financial covenants under the Revolving Credit Facility.

We finance our short-term liquidity needs with bank borrowings, commercial paper borrowings, and bankers' acceptances. As of May 26, 2019, there were no outstanding borrowings under our commercial paper program. As of May 27, 2018, we had $277.0 million outstanding under our commercial paper program at an average weighted interest rate of 2.08%.