ADT 2013 Annual Report Download - page 144

FORM 10-K
5. Debt
Debt as of September 27, 2013 and September 28, 2012 is as follows ($ in millions):
September 27,
2013
September 28,
2012
Current maturities of long-term debt:
Capital lease obligations ..................... $ 2 $ 2
Other ..................................... 1 —
Current maturities of long-term debt ............ 3 2
Long-term debt:
2.250% notes due July 2017 ................... 750 749
3.500% notes due July 2022 ................... 998 998
4.125% notes due June 2023 .................. 700 —
4.875% notes due July 2042 ................... 742 742
Capital lease obligations ..................... 31 36
Revolving credit facility ...................... 150 —
Other ..................................... 2 —
Total long-term debt ......................... $3,373 $2,525
Total debt ................................. $3,376 $2,527
On June 22, 2012, the Company entered into an unsecured senior revolving credit facility with a maturity
date of June 22, 2017 and an aggregate commitment of $750 million, which is available to be used for working
capital, capital expenditures and other corporate purposes. The interest rate for borrowings under the revolving
credit facility is based on the London Interbank Offered Rate (“LIBOR”) or an alternative base rate, plus a
spread, based upon the Company’s credit rating. During the quarter ended September 27, 2013, the Company had
average borrowings under the facility of $41 million at an average interest rate of 1.609%. There were no
borrowings under the facility during fiscal year 2012 or the first three quarters of fiscal year 2013. On October 1,
2013, the Company issued $1.0 billion in unsecured notes due October 15, 2021 (the “October 2013 Debt
Offering”), $150 million of which was used to repay the amounts borrowed and outstanding under the revolving
credit facility as of September 27, 2013. Pursuant to applicable accounting guidance, the outstanding borrowings
under the facility were effectively refinanced on a long-term basis prior to the issuance of the Company’s
financial statements for fiscal year 2013. As a result of this refinancing, these borrowings are classified as long-
term debt on the Company’s Consolidated Balance Sheet as of September 27, 2013.
On July 5, 2012, the Company issued $2.5 billion aggregate principal amount of unsecured notes, of which
$750 million aggregate principal amount of 2.250% notes will mature on July 15, 2017, $1.0 billion aggregate
principal amount of 3.500% notes will mature on July 15, 2022, and $750 million aggregate principal amount of
4.875% notes will mature on July 15, 2042. Cash proceeds from the issuance of this term indebtedness, net of
debt issuance costs, totaled approximately $2.47 billion and were used primarily to repay intercompany debt and
to make other cash payments to Tyco in conjunction with the Separation. Interest is payable on January 15 and
July 15 of each year. The Company may redeem each series of the notes, in whole or in part, at any time at a
redemption price equal to the principal amount of the notes to be redeemed, plus a make-whole premium.
On January 14, 2013, the Company issued $700 million aggregate principal amount of 4.125% unsecured
notes due June 2023 to certain institutional investors pursuant to certain exemptions from registration under the
Securities Act of 1933, as amended (the “January 2013 Debt Offering”). Net cash proceeds from the issuance of
this term indebtedness totaled $694 million and were primarily used for the repurchase of outstanding shares of
ADT’s common stock. Interest is payable on June 15 and December 15 of each year, commencing on June 15,
2013. The Company may redeem the notes, in whole or in part, at any time prior to the maturity date at a
redemption price equal to the greater of the principal amount of the notes to be redeemed, or a make-whole
premium, plus in each case, accrued and unpaid interest to, but excluding, the redemption date.
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