LONG-TERM DEBT



	May 31, 2015			May 25, 2014
4.65% senior debt due January 2043	$	737.0		$	937.0
6.625% senior debt due August 2039 (including Ralcorp senior notes)	450.0			450.0
8.25% senior debt due September 2030	300.0			300.0
7.0% senior debt due October 2028	382.2			382.2
6.7% senior debt due August 2027	9.2			9.2
7.125% senior debt due October 2026	372.4			372.4
3.2% senior debt due January 2023	1,000.0			1,225.0
3.25% senior debt due September 2022	250.0			250.0
9.75% subordinated debt due March 2021	195.9			195.9
4.95% senior debt due August 2020 (including Ralcorp senior notes)	300.0			300.0
7.0% senior debt due April 2019	475.0			500.0
2.1% senior debt due March 2018	225.0			250.0
1.9% senior debt due January 2018	1,000.0			1,000.0
LIBOR plus 1.75% term loans due January 2018	—			900.0
5.819% senior debt due June 2017	475.0			500.0
LIBOR plus 0.37% term loans due July 2016	550.0			—
1.3% senior debt due January 2016	750.0			750.0
1.35% senior debt due September 2015	250.0			250.0
2.00% to 9.59% lease financing obligations due on various dates through 2040	68.7			78.7
Other indebtedness	10.9			86.4
Total face value of debt	7,801.3			8,736.8
Unamortized fair value adjustment of senior debt in connection with Ralcorp	146.7			154.5
Unamortized discounts/premiums	(32.8		)	(46.5		)
Unamortized debt issuance costs	(30.1		)	(46.9		)
Adjustment due to hedging activity	11.8			6.7
Less current installments	(1,008.0		)	(84.1		)
Total long-term debt	$	6,888.9		$	8,720.5

The aggregate minimum principal maturities of the long-term debt for each of the five fiscal years following May 31, 2015, are as follows:



2016	$	1,009.0
2017	568.4
2018	1,706.3
2019	479.7
2020	4.0

During fiscal 2015, we repurchased $225.0 million aggregate principal amount of senior notes due in 2023, $200.0 million aggregate principal amount of senior notes due 2043, $25.0 million aggregate principal amount of senior notes due 2019, $25.0 million aggregate principal amount of senior notes due 2018, and $25.0 million aggregate principal amount of senior notes due 2017, in each case prior to maturity in a tender offer, resulting in a net loss of $16.3 million as a cost of early retirement of debt, including a $9.5 million tender premium.

During fiscal 2015, we issued $550.0 million aggregate principal amount of floating rate notes due July 21, 2016. The notes bear interest at a rate equal to three-month LIBOR plus 0.37% per annum.

During fiscal 2014, we repaid the entire principal balance of $500.0 million of our 5.875% senior notes, which were due April 15, 2014.

During fiscal 2013, in order to finance a portion of our acquisition of Ralcorp, we (i) issued senior unsecured notes in an aggregate principal amount of $3.975 billion, (ii) issued senior unsecured notes in an aggregate principal amount of $716.0 million in exchange for senior notes issued by Ralcorp, (iii) assumed senior notes issued by Ralcorp in an aggregate principal amount of $460.7 million, which were prepaid in fiscal 2013, and (iv) borrowed $1.5 billion under our new Term Loan Facility.

Our senior unsecured notes in an aggregate principal amount of $3.975 billion were issued in four tranches: 1.3% senior notes due January 25, 2016 in an aggregate principal amount of $750.0 million; 1.9% senior notes due January 25, 2018 in an aggregate principal amount of $1.0 billion; 3.2% senior notes due January 25, 2023 in an aggregate principal amount of $1.225 billion; and 4.65% senior notes due January 25, 2043 in an aggregate principal amount of $1.0 billion. During fiscal 2014, we repaid $63.0 million of the 4.65% senior notes due in 2043 prior to maturity, resulting in a net gain of $3.7 million.

Our senior unsecured notes in an aggregate principal amount of $716.0 million were issued in exchange for senior notes issued by Ralcorp pursuant to our offer to exchange (i) any and all 4.95% senior notes due August 15, 2020 issued by Ralcorp for up to an aggregate principal amount of $300.0 million of new 4.95% senior notes due August 15, 2020 issued by the Company and cash and (ii) any and all 6.625% senior notes due August 15, 2039 issued by Ralcorp for up to an aggregate principal amount of $450.0 million of new 6.625% senior notes due August 15, 2039 issued by the Company and cash. Our senior unsecured notes in an aggregate principal amount of $716.0 million consist of the following:



4.95% senior notes due August 2020 (2.92% effective interest rate)	$	282.7
6.625% senior notes due August 2039 (4.86% effective interest rate)	433.3

Senior notes issued by Ralcorp in an aggregate principal amount of $33.9 million were not exchanged and remain outstanding, consisting of 4.95% senior notes issued by Ralcorp due August 15, 2020 in an aggregate principal amount of $17.2 million (with an effective interest rate of 2.83%) and 6.625% senior notes issued by Ralcorp due August 15, 2039 in an aggregate principal amount of $16.7 million (with an effective interest rate of 4.82%) (collectively, the "Ralcorp Notes"). The Ralcorp Notes are included in our Consolidated Balance Sheets at May 31, 2015.

During fiscal 2013, we offered to purchase for cash any and all 7.29% senior notes due August 15, 2018 issued by Ralcorp, floating rate senior notes due August 15, 2018 issued by Ralcorp, and 7.39% senior notes due August 15, 2020 issued by Ralcorp, in a total aggregate principal amount of $664.5 million. Pursuant to this offer, we purchased senior notes issued by Ralcorp in a total aggregate principal amount of $631.5 million. Ralcorp's 7.29% senior notes due August 15, 2018 in an aggregate principal amount of $33.0 million were not tendered for purchase and remained outstanding (the "Ralcorp Discharged Notes"). During fiscal 2013, we paid $44.8 million, consisting of principal, interest, and contractual amounts payable to satisfy and discharge the Ralcorp Discharged Notes, which were satisfied and discharged by the trustee during fiscal 2013. We recognized a charge of $1.3 million as a cost of early retirement of debt.

Upon our acquisition of Ralcorp, we assumed senior notes issued by Ralcorp in an aggregate principal amount of $460.7 million (the "Ralcorp Callable Notes"), and gave notice of our intent to prepay them during the third quarter of fiscal 2013. During the fourth quarter of fiscal 2013, we prepaid the Ralcorp Callable Notes at the contractually determined value of $562.5 million. This did not result in a significant gain or loss.

During fiscal 2013, we borrowed $1.5 billion under our unsecured Term Loan Facility with a syndicate of banks. We elected to base the interest rate of the borrowings on LIBOR plus 1.75%. We were required to repay borrowings under the Term Loan Facility during the term of the facility in equal quarterly installments of 2.5% per quarter commencing on June 1, 2013, with the remainder of the borrowings to be paid on the maturity date of the facility, unless prepaid prior to such date in accordance with the terms of the Term Loan Facility. During fiscal 2013, we prepaid $600.0 million of the $1.5 billion borrowings and recognized a charge of $6.2 million as a cost of early retirement of debt. During fiscal 2015, we repaid the remaining borrowings of $900.0 million, prior to maturity, resulting in a loss of $8.3 million as a cost of early retirement of debt. The Term Loan Facility was terminated after repayment.

In connection with the aforementioned financing for the Ralcorp acquisition, we capitalized $52.1 million of debt issuance costs and recognized expense of $27.3 million in related fees during fiscal 2013.

Net interest expense consists of:



	2015			2014			2013
Long-term debt	$	336.9		$	393.8		$	284.0
Short-term debt	2.8			1.5			0.6
Interest income	(1.2		)	(2.3		)	(2.9		)
Interest capitalized	(6.6		)	(13.6		)	(5.5		)
	$	331.9		$	379.4		$	276.2

Interest paid from continuing operations was $337.7 million, $395.6 million, and $215.4 million in fiscal 2015, 2014, and 2013, respectively.

Our net interest expense in fiscal 2015 and 2014 was reduced by $7.1 million and $4.1 million, respectively, due to the impact of the interest rate swap contracts designated as fair value hedges entered into in the third quarter of fiscal 2014. The interest rate swaps effectively converted the interest on our senior long-term debt instruments maturing in fiscal 2019 and 2020 from fixed rate to floating rate (see Note 18). These interest rate swap contracts were terminated during the third quarter of fiscal 2015. The cumulative adjustments to the fair value of the debt instruments that were hedged (the effective portion of the hedges), totaling $12.6 million, will be amortized as a reduction of interest expense over the remaining lives of the debt instruments (through fiscal 2020). Our net interest expense was reduced by $0.8 million for fiscal 2015 as a result of this amortization.

We entered into interest rate swaps during fiscal 2010 that effectively changed our interest rate on the senior long-term debt instrument that matured in fiscal 2014 from fixed to variable. During the second quarter of fiscal 2011, we terminated these interest rate swap contracts and received proceeds of $28.2 million. The cumulative adjustment to the fair value of the debt instrument that was hedged (the effective portion of the hedge) was amortized as a reduction of interest expense over the remaining life of the debt instrument (through fiscal 2014). Net interest expense for fiscal 2014 and 2013 was reduced by $8.6 million and $9.2 million, respectively, due to the impact of the interest rate swap contracts.

As a result of our acquisition of Ralcorp, the senior unsecured notes issued in exchange for senior notes issued by Ralcorp of $716.0 million and the senior notes issued by Ralcorp that remain outstanding of $33.9 million were recorded at fair value. The combined fair value adjustment on these notes was $163.8 million and is being amortized within interest expense over the life of the respective notes. Our net interest expense in fiscal 2015, 2014, and 2013 was reduced by $7.8 million, $7.1 million, and $2.2 million, respectively, as a result of this amortization.