3M 2006 Annual Report Download - page 86

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Maturities of long-term debt for the five years subsequent to December 31, 2006 are as follows (in millions):
2007 2008 2009 2010 2011 Thereafter Total
    ± ±  
/RQJWHUPGHEWSD\PHQWVGXHLQLQFOXGHPLOOLRQRI&RQYHUWLEOH1RWHVILQDOPDWXULW\PLOOLRQRI
dealer remarketable securities (final maturity 2010), $62 million of medium-term notes (final maturity 2044),
$42 million of floating rate notes (final maturity 2037), and $29 million of floating rate notes (final maturity 2027). The
IORDWLQJUDWHQRWHVDUHSUHVHQWHGDV³2WKHUERUURZLQJV´LQthe preceding long-term debt table. These securities are
classified as current portion of long-term debt as the result of put provisions associated with these debt instruments.
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contributions are not reported as interest expense, but are reported as an employee benefit expense in the
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debt.
$W'HFHPEHUFHUWDLQGHEWDJUHHPHQWVPLOOLon of dealer remarketable securities and $127 million of
(623GHEWKDGUDWLQJVWULJJHUV%%%%DDRUORZHUWKDWZRXOGUHTXLUHUHSD\PHQWRIGHEW7KH&RPSDQ\FXUUHQWO\
KDV$$$DGHEWUDWLQJV,QDGGLWLRQDPLOOLRQILYH-year credit agreement requires 3M to maintain a
capitalization ratio at no more than 0.60 to 1 at the end of each quarter. This ratio is calculated as funded debt
(including all borrowed money and letters of credit utilized) to the sum of funded debt and equity. At December 31,
2006, this ratio was approximately 0.27 to 1. At December 31, 2006, available short-term committed lines of credit
globally totaled approximately $620 million, of which $107 million was utilized. Debt covenants do not restrict the
payment of dividends.
3M has a medium-term notes program and shelf registration that have remaining capacity of approximately $1.038 billion
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SURJUDPWKURXJKZKLFKXSWRELOOLRQRIPHGLXPWHUPQRWHVPD\EHRIIHUHG,Q1RYHPEHU0LVVXHGDWKUHH
\HDUPLOOLRQIL[HGUDWHQRWH7KH&RPSDQ\HQWHUHGLQWRDQinterest rate swap to convert this to a rate based on a
IORDWLQJ/,%25LQGH[,Q'HFHPEHU0LVVXHGD\HDU, $62 million, floating rate note, with the rate based on a
IORDWLQJ/,%25LQGH[0SODQVWRXVHWKHQHWSURFHHGVIURP issuances of debt securities under this registration for
general corporate purposes, including the repayment of debt; investments in or extensions of credit to 3M subsidiaries; or
the financing of possible acquisitions or business expansion.
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beginning November 21, 2007, at the accreted conversion price; however, bondholders may convert upon notification
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YDOXHRQ1RYHPEHU7KHFDVKLQWHUHVWSD\Pents will be made semiannually in arrears on May 22, 2006,
November 22, 2006, May 22, 2007 and November 22, 2007 to KROGHUVRIUHFRUGRQWKHWKFDOHQGDUGD\SUHFHGLQJ
each such interest payment date.
3M originally sold $639 million in aggregate face amount ofWKHVH³&RQYHUWLEOH1RWHV´RQ1RYHPEHUZKLFK
are convertible into shares of 3M common stock. The gross proceeds from the offering, to be used for general
FRUSRUDWHSXUSRVHVZHUHPLOOLRQPLOOLRQQHWRILVVuance costs). Debt issuance costs were amortized on a
straight-line basis over a three-year period beginning in 1RYHPEHU2Q)HEUXDU\0UHJLVWHUHGWKHVH
&RQYHUWLEOH1RWHVLQDUHJLVWUDWLRQVWatement filed with the Securities DQG([FKDQJH&RPPLVVLRQ7KHWHUPVRIWKH
&RQYHUWLEOH1RWHVLQFOXGHD\LHOGWRPDWXULW\RIDQGan initial conversion premium ofRYHUWKHVSOLW
adjusted) closing price of 3M common stock on November ,IFHUWDLQFRQGLWLRQVIRUFRQYHUVLRQUHODWLQJWR
the closing common stock prices of 3M exceeding the conversion trigger price for specified periods) are met, holders
may convert each of the 30-year zero-coupon senior notes into 9.4602 shares of 3M common stock in any calendar
quarter commencing after March 31, 2003. The conversion trigger price for the fourth quarter of 2006 was $120.60
SHUVKDUH,IWKHFRQGLWLRQVIRUFRQYHUVLon are met, and 3M elects not to settle in cash, the 30-year zero-coupon senior
notes will be convertible in the aggregate into approximately PLOOLRQVKDUHVRI0FRPPRQVWRFN0PD\FKRRVH
rate notes in the United States, with the long-term portion of this debt primarily composed of U.S. dollar floating rate
of redemption each of the notes into 9.4602 shares of 3M common stock. Holders of the 30-year zero-coupon senior
notes have the option to require 3M to purchase their notes at accrHWHGYDOXHRQ1RYHPEHULQWKH\HDUV
2012, 2017, 2022 and 2027.
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