ADP 2010 Annual Report Download - page 68

Components of intangible assets are as follows:
Other intangibles consist primarily of purchased rights, covenants, patents and trademarks (acquired directly or through
acquisitions). All of the intangible assets have finite lives and, as such, are subject to amortization. The weighted average remaining
useful life of the intangible assets is 6 years (3 years for software and software licenses, 8 years for customer contracts and lists, and
7 years for other intangibles). Amortization of intangible assets was $156.6 million, $151.9 million and $152.0 million for fiscal 2010,
2009 and 2008, respectively.
Estimated amortization expenses of the Company
’ s existing intangible assets for the next five fiscal years are as follows:
The Company has not incurred significant costs to renew or extend the term of acquired intangible assets during fiscal 2010.
NOTE 11. SHORT - TERM FINANCING
In June 2010, the Company entered into a $2.5 billion, 364
- day credit agreement with a group of lenders. The 364 - day facility replaced
the Company
’ s prior $2.25 billion 364 - day facility. In addition, the Company entered into a three - year $1.5 billion credit facility
maturing in June 2013 that contains an accordion feature under which the aggregate commitment can be increased by $500.0 million,
subject to the availability of additional commitments. The three
- year facility replaced our prior $1.5 billion five - year facility, which
expired in June 2010. The Company also has an existing $2.25 billion five
- year credit facility that matures in June 2011 that also
contains an accordion feature under which the aggregate commitment can be increased by $500.0 million, subject to the availability
of additional commitments. The interest rate applicable to the committed borrowings is tied to LIBOR, the federal funds effective rate
or the prime rate depending on the notification provided by the Company to the syndicated financial institutions prior to borrowing.
The Company is also required to pay facility fees on the credit agreements. The primary uses of the credit facilities are to provide
liquidity to the commercial paper program and to provide funding for general corporate purposes, if necessary. The Company had no
borrowings through June 30, 2010 under the credit agreements.
The Company
’ s U.S. short - term funding requirements related to client funds are sometimes obtained through a short - term
commercial paper program, which provides for the issuance of up to $6.0 billion in aggregate maturity value of commercial paper. In
August 2010, the Company increased the U.S. short - term commercial paper program to provide for the issuance of up to $6.25 billion
in aggregate maturity value. The Company ’ s commercial paper program is rated A - 1+ by Standard and Poor ’ s and Prime - 1 by
Moody ’ s. These ratings denote the highest quality commercial paper securities. Maturities of commercial paper can range from
overnight to up to 364 days. At June 30, 2010, the Company had no commercial paper outstanding. At June 30, 2009, the Company
had $0.7 billion in commercial paper outstanding. Such amount was repaid on July 1, 2009. In fiscal 2010 and 2009, the Company ’ s
average borrowings were $1.6 billion and $1.9 billion, respectively, at a weighted average interest rate of 0.2% and 1.0%, respectively.
June 30,
2010
2009
Intangibles:
Software and software licenses
$
1,160.0
$
1,085.0
Customer contracts and lists
640.3
621.9
Other intangibles
209.5
197.3
2,009.8
1,904.2
Less accumulated amortization:
Software and software licenses
(946.0
)
(858.5
)
Customer contracts and lists
(375.6
)
(328.6
)
Other intangibles
(145.8
)
(138.4
)
(1,467.4
)
(1,325.5
)
Intangible assets, net
$
542.4
$
578.7
Twelve months ending June 30, 2011
$
157.2
Twelve months ending June 30, 2012
$
126.5
Twelve months ending June 30, 2013
$
65.5
Twelve months ending June 30, 2014
$
50.6
Twelve months ending June 30, 2015
$
39.2