AMD 2009 Annual Report Download - page 119

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Future Payments on Long Term Debt and Capital Lease Obligations
As of December 26, 2009, the Company’s long term debt and capital lease payment obligations for each of
the next five years and beyond, are:
Long Term
Debt
(Principal
only)
Capital
Leases
(In millions)
2010 .................................................... $ 290 $ 49
2011 .................................................... 170 49
2012 .................................................... 485 50
2013 .................................................... — 50
2014 .................................................... — 50
Beyond 2014 ............................................. 3,359 177
Total .................................................... 4,304 425
Less: amount representing interest ............................ — 169
Total .................................................... $4,304 $256
Other Short Term Obligations
In addition to the Company’s long-term debt and capital lease obligations as stated in the earlier table, the
Company also has the following short term obligations.
Receivable Financing Arrangement
On March 26, 2008, the Company entered into a Sale of Receivables—Supplier Agreement with IBM Credit
LLC (IBM Credit), and one of its wholly-owned subsidiaries, AMD International Sales & Service, Ltd.
(AMDISS), entered into the same sales agreement with IBM United Kingdom Financial Services Ltd. (IBM UK),
pursuant to which the Company and AMDISS agreed to sell to each of IBM Credit and IBM UK certain
receivables. In November 2009, AMD (China), Co. Ltd entered into a similar sales agreement with IBM
Factoring (CHINA) Co., Ltd., (IBM GF), pursuant to which AMD (China) agreed to sell to IBM GF certain
receivables. Pursuant to the sales agreements, the IBM parties agreed to purchase from the AMD parties invoices
of specified AMD customers up to credit limits set by the IBM parties. As of December 26, 2009, only selected
distributor customers have participated in this program. Because the Company does not recognize revenue until
its distributors sell its products to their customers, the Company classified funds received from the IBM parties as
debt. The debt is reduced as the IBM parties receive payments from the distributors. In 2009, the Company
received proceeds of approximately $605 million from the transfer of accounts receivable under these financing
arrangements, and the IBM parties collected approximately $535 million from the distributors participating in
these arrangements. $156 million and $86 million were outstanding under these agreements as of December 26,
2009 and December 27, 2008, respectively. These amounts appear as “Other short-term obligations” on the
Company’s consolidated balance sheets and are not considered cash commitments. In December 2009, the
Company expanded its relationship with IBM to include selected distributor receivables of its Canadian
subsidiary, ATI Technologies.
AMD China Revolving Credit Line
In November 2009, AMD Products (China) Co. Ltd. (AMD Products) entered into a one year revolving
credit agreement in the amount of RMB200 million ($30 million based on a foreign exchange rate as of
December 26, 2009) with China Merchant Bank to finance the working capital needs of AMD Products. The
interest rate is based on the six-month loan rates published by The People’s Bank of China. The Company must
repay the principal and accrued interest every three months. Advanced Micro Devices (China) Co., Ltd., the
parent company of AMD Products, provided an irrevocable guarantee to China Merchant Bank with respect to
the amounts outstanding under the revolving credit agreement. As of December 26, 2009, the outstanding
balance was RMB100 million ($15 million), and the interest rate was 4.45 percent.
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