AMD 2011 Annual Report Download - page 106

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Upon the occurrence of certain events described in the 6.00% Indenture, the 6.00% Notes will be
convertible into cash up to the principal amount, and if applicable, into shares of the Company’s common stock
issuable upon conversion of the 6.00% Notes in respect of any conversion value above the principal amount,
based on an initial conversion rate of 35.6125 shares of common stock per $1,000 principal amount of 6.00%
Notes, which is equivalent to an initial conversion price of $28.08 per share. This initial conversion price
represents a premium of 100% relative to the last reported sale price of the Company’s common stock on
April 23, 2007 (the trading date preceding the date of pricing of the 6.00% Notes) of $14.04 per share. The
conversion rate will be adjusted for certain anti-dilution events. In addition, the conversion rate will be increased
in the case of corporate events that constitute a fundamental change (as defined in the 6.00% Indenture) under
certain circumstances. Holders of the 6.00% Notes may require the Company to repurchase the 6.00% Notes for
cash equal to 100% of the principal amount to be repurchased plus accrued and unpaid interest upon the
occurrence of a fundamental change or a termination of trading (as defined in the 6.00% Indenture).
Additionally, an event of default (as defined in the 6.00% Indenture) may result in the acceleration of the
maturity of the 6.00% Notes.
The 6.00% Notes rank equally with the Company’s existing and future senior debt and are senior to all of
the Company’s future subordinated debt. The 6.00% Notes rank junior to all of the Company’s future senior
secured debt to the extent of the collateral securing such debt and are structurally subordinated to all existing and
future debt and liabilities of the Company’s subsidiaries.
The Company may elect to purchase or otherwise retire the balance of the 6.00% Notes with cash, stock or
other assets from time to time in open market or privately negotiated transactions, either directly or through
intermediaries, or by tender offer when it believes the market conditions are favorable to do so.
8.125% Senior Notes Due 2017
On November 30, 2009, the Company issued $500 million of the 8.125% Senior Notes Due 2017 (the
8.125% Notes) at a discount of 10.204%. The 8.125% Notes are general unsecured senior obligations. Interest is
payable on June 15 and December 15 of each year beginning June 15, 2010 until the maturity date of
December 15, 2017. The discount of $51 million is recorded as contra debt and will be amortized to interest
expense over the life of the 8.125% Notes using the effective interest method. The 8.125% Notes are governed by
the terms of an indenture (the 8.125% Indenture) dated November 30, 2009 between the Company and
Wells Fargo Bank, National Association, as Trustee.
As of December 31, 2011, the outstanding aggregate principal amount of the Company’s 8.125% Notes was
$500 million and the remaining carrying value was approximately $459 million, net of debt discount of $41
million.
At anytime (which may be more than once) before December 15, 2012, the Company may redeem up to
35% of the aggregate principal amount of the 8.125% Notes within 90 days of the closing of an equity offering
with the net proceeds thereof at a redemption price of not greater than 108.125% of the principal amount thereof,
together with accrued and unpaid interest to but excluding the date of redemption. Prior to December 15, 2013,
the Company may redeem some or all of the 8.125% Notes at a price equal to 100% of the principal amount, plus
accrued and unpaid interest and a “make whole” premium (as defined in the 8.125% Indenture). Thereafter, the
Company may redeem all or part of the 8.125% Notes at any time at specified redemption prices, plus accrued
and unpaid interest.
Holders have the right to require the Company to repurchase all or a portion of the Company’s 8.125%
Notes in the event that the Company undergoes a change of control, as defined in the indenture governing the
8.125% Notes, at a repurchase price of 101% of the principal amount plus accrued and unpaid interest.
Additionally, an event of default (as defined in the 8.125% Indenture) may result in the acceleration of the
maturity of the 8.125% Notes.
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