Long-Term Debt

Our long-term debt consists of privately placed senior notes issued under note purchase agreements, as well as publicly issued medium-term and senior notes issued under an indenture. All of our long-term debt is unsecured and is issued at fixed rates. Long-term debt as of October 31, 2014 and 2013 is as follows.



In thousands	2014		2013
Senior Notes:
2.92%, due June 6, 2016	$	40,000	$	40,000
8.51%, due September 30, 2017	35,000		35,000
4.24%, due June 6, 2021	160,000		160,000
3.47%, due July 16, 2027	100,000		100,000
3.57%, due July 16, 2027	200,000		200,000
4.10%, due September 18, 2034	250,000		—
4.65%, due August 1, 2043	300,000		300,000
Medium-Term Notes:
5.00%, due December 19, 2013	—		100,000
6.87%, due October 6, 2023	45,000		45,000
8.45%, due September 19, 2024	40,000		40,000
7.40%, due October 3, 2025	55,000		55,000
7.50%, due October 9, 2026	40,000		40,000
7.95%, due September 14, 2029	60,000		60,000
6.00%, due December 19, 2033	100,000		100,000
Total	1,425,000		1,275,000
Less current maturities	—		100,000
Less discount on issuance of notes *	570		143
Total	$	1,424,430	$	1,174,857

* The discount on the 4.65% senior notes was $138 and $143 at October 31, 2014 and 2013, respectively. The discount on the 4.10% senior notes was $432 at October 31, 2014.

Current maturities for the next five years ending October 31 and thereafter are as follows.



In thousands
2015	$	—
2016	40,000
2017	35,000
2018	—
2019	—
Thereafter	1,350,000
Total	$	1,425,000

We had an open combined debt and equity shelf registration statement filed with the SEC in July 2011 that was available for future use until its expiration date of July 6, 2014. In February 2013, we sold shares of common stock under this registration statement. For further information on this transaction, see Note 6 to the consolidated financial statements.

On August 1, 2013, we issued $300 million of thirty-year, unsecured senior notes with an interest rate of 4.65% and at a discount of .048% or $144,000, which we began to amortize ratably over the expected life of the notes, under the registration statement in effect noted above. We have the option to redeem all or part of the notes before the stated maturity prior to February 1, 2043, at a redemption price equal to the greater of a) 100% of the principal amount plus any accrued and unpaid interest to the date of redemption, or b) the sum of the present values of the remaining scheduled payments of principal and interest on the notes to be redeemed, discounted to the date of redemption on a semi-annual basis at the Treasury Rate as defined in the indenture, plus 15 basis points and any accrued and unpaid interest to the date of redemption. We have the option to redeem all or part of the notes before the stated maturity on or after February 1, 2043, at 100% of the principal amount plus any accrued and unpaid interest to the date of redemption. We used the net proceeds of $297.2 million from this issuance to finance capital expenditures, to repay $100 million of our 5% medium-term notes due December 19, 2013 at maturity, to repay outstanding short-term notes under our unsecured commercial paper (CP) program and for general corporate purposes.

In June 2014, we filed with the SEC a combined debt and equity shelf registration statement that became effective on June 6, 2014. The NCUC has approved debt and equity issuances under this shelf registration statement up to $1 billion during its three-year life. Unless otherwise specified at the time such securities are offered for sale, the net proceeds from the sale of the securities will be used to finance capital expenditures, to repay outstanding short-term, unsecured notes under our CP program, to refinance other indebtedness, to repurchase our common stock, to pay dividends and for general corporate purposes.

On September 18, 2014, we issued $250 million of twenty-year, unsecured senior notes with an interest rate of 4.10% and at a discount of .174% or $435,000, which we began to amortize ratably over the expected life of the notes, under the registration statement in effect noted above. We have the option to redeem all or part of the notes before the stated maturity prior to March 18, 2034, at a redemption price equal to the greater of a) 100% of the principal amount plus any accrued and unpaid interest to the date of redemption, or b) the sum of the present values of the remaining scheduled payments of principal and interest on the notes to be redeemed, discounted to the date of redemption on a semi-annual basis at the Treasury Rate as defined in the indenture, plus 15 basis points and any accrued and unpaid interest to the date of redemption. We have the option to redeem all or part of the notes before the stated maturity on or after March 18, 2034, at 100% of the principal amount plus any accrued and unpaid interest to the date of redemption. We used the net proceeds of $247.7 million from this issuance to finance capital expenditures, to repay outstanding short-term, unsecured notes under our CP program and for general corporate purposes.

The amount of cash dividends that may be paid on common stock is restricted by provisions contained in certain note agreements under which long-term debt was issued, with those for the senior notes being the most restrictive. We cannot pay or declare any dividends or make any other distribution on any class of stock or make any investments in subsidiaries or permit any subsidiary to do any of the above (all of the foregoing being “restricted payments”), except out of net earnings available for restricted payments. As of October 31, 2014, our net earnings available for restricted payments were $1.1 billion.

We are subject to default provisions related to our long-term debt and short-term borrowings. Failure to satisfy any of the default provisions may result in total outstanding issues of debt becoming due. There are cross default provisions in all of our debt agreements. As of October 31, 2014, we are in compliance with all default provisions.

The default provisions of some or all of our senior debt include:


•	Failure to make principal or interest payments,


•	Bankruptcy, liquidation or insolvency,


•	Final judgment against us in excess of $1 million that after 60 days is not discharged, satisfied or stayed pending appeal,


•	Specified events under the Employee Retirement Income Security Act of 1974,


•	Change in control, and


•	Failure to observe or perform covenants, including:


•	Interest coverage of at least 1.75 times. Interest coverage was 4.29 times as of October 31, 2014;


•	Funded debt cannot exceed 70% of total capitalization. Funded debt was 58% of total capitalization as of October 31, 2014;


•	Funded debt of all subsidiaries in the aggregate cannot exceed 15% of total capitalization. There is no funded debt of our subsidiaries as of October 31, 2014;


•	Restrictions on permitted liens;


•	Restrictions on paying dividends, on or repurchasing our stock or making investments in subsidiaries; and


•	Restrictions on burdensome agreements.