AMD 2014 Annual Report Download - page 95

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Information related to equity and debt components:
December 27,
2014
December 28,
2013
(In millions)
Carrying amount of the equity component ................ $ 125 $ 159
Principal amount of the 6.00% Notes .................... 42 530
Unamortized discount ................................ — (13)
Net carrying amount ................................. $ 42 $ 517
Information related to interest rates and expense:
2014 2013 2012
(In millions, except percentages)
Effective interest rate ................................................... 8% 8% 8%
Interest cost related to contractual interest coupon ............................ $ 9 $ 45 $ 44
Interest cost related to amortization of the discount ............................ $ 3 $ 10 $ 9
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 the 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.
8.125% Senior Notes Due 2017
On November 30, 2009, the Company issued $500 million of the 8.125% Senior Notes Due 2017 (8.125%
Notes) at a discount of 10.204%.
During 2014, the Company repurchased and redeemed the entire $500 million in aggregate principal amount
of its 8.125% Notes for $531 million, which included payment of accrued and unpaid interest of $8 million. The
Company incurred a total loss of $54 million in connection with the foregoing repurchase and redemption of the
8.125% Notes. As of December 27, 2014, the Company did not have any 8.125% Notes outstanding.
6.75% Senior Notes Due 2019
On February 26, 2014, the Company issued $600 million of its 6.75% Notes. The 6.75% Notes are general
unsecured senior obligations of the Company. Interest is payable on March 1 and September 1 of each year
beginning September 1, 2014 until the maturity date of March 1, 2019. The 6.75% Notes are governed by the
terms of an indenture (the 6.75% Indenture) dated February 26, 2014 between the Company and Wells Fargo
Bank, N.A., as trustee.
As of December 27, 2014, the outstanding aggregate principal amount of the 6.75% Notes was $600
million.
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