ADT 2011 Annual Report Download - page 227

TYCO INTERNATIONAL LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
12. Debt (Continued)
governing the notes. The debt issuance costs will be amortized from the date of issuance to the
maturity date of each series of the notes. Interest is payable semi-annually on January 15th and
July 15th for both the 2018 Notes and 2023 Notes.
Fiscal 2010 Debt Issuance/Repayment
On May 5, 2010, TIFSA issued $500 million aggregate principal amount of 3.375% notes due on
October 15, 2015, which are fully and unconditionally guaranteed by the Company (the ‘‘2015 notes’’).
TIFSA received net proceeds of approximately $495 million after deducting debt issuance costs of
approximately $3 million and a debt discount of approximately $2 million. The net proceeds, along with
other available funds, were used to redeem all of the Company’s outstanding 6.375% notes due
October 2011. The 2015 notes are unsecured and rank equally with TIFSA’s other unsecured and
unsubordinated debt. TIFSA may redeem any of the 2015 notes at any time by paying the greater of
the principal amount of the notes or a ‘‘make-whole’’ amount, plus accrued and unpaid interest. The
holders of the 2015 notes have the right to require TIFSA to repurchase all or a portion of the notes at
a purchase price equal to 101% of the principal amount of the notes repurchased, plus accrued and
unpaid interest upon the occurrence of a change of control triggering event which requires the
occurrence of both a change of control and a rating event, each as defined in the Indenture governing
the notes. The debt issuance costs will be amortized from the date of issuance to the maturity date.
Interest is payable semiannually on April 15th and October 15th.
On May 28, 2010, the Company redeemed all of its 6.375% public notes due 2011 (the ‘‘2011
notes’’), 7% notes due 2028 and 6.875% notes due 2029, outstanding at that time, which aggregated
$878 million in principal amount. As a result of the debt redemption, the Company recorded an
$87 million charge to other expense, net as a loss on extinguishment of debt. The charge is comprised
of the make-whole premium, write-off of the unamortized debt issuance costs and discount related to
the extinguished bonds and a net loss recognized upon termination of the associated interest rate swap
contracts related to the 2011 notes.
On October 5, 2009, TIFSA issued $500 million aggregate principal amount of 4.125% notes due
on October 15, 2014, which are fully and unconditionally guaranteed by the Company (the ‘‘2014
notes’’). TIFSA received net proceeds of approximately $495 million after deducting debt issuance costs
of approximately $3 million and a debt discount of approximately $2 million. The 2014 notes are
unsecured and rank equally with TIFSA’s other unsecured and unsubordinated debt. TIFSA may
redeem any of the 2014 notes at any time by paying the greater of the principal amount of the notes or
a ‘‘make-whole’’ amount, plus accrued and unpaid interest. The holders of the 2014 notes have the
right to require TIFSA to repurchase all or a portion of the notes at a purchase price equal to 101% of
the principal amount of the notes repurchased, plus accrued and unpaid interest upon the occurrence
of a change of control triggering event, which requires both a change of control and a rating event,
each as defined in the Indenture governing the notes. The debt issuance costs will be amortized from
the date of issuance to the maturity date. Interest is payable semiannually on April 15th and
October 15th.
Fiscal 2009 Debt Issuance/Repayment
On January 9, 2009, TIFSA issued $750 million aggregate principal amount of 8.5% notes due on
January 15, 2019, which are fully and unconditionally guaranteed by the Company (the ‘‘2019 notes’’).
124 2011 Financials