AT&T Wireless 2010 Annual Report Download - page 76

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Notes to Consolidated Financial Statements (continued)
Dollars in millions except per share amounts
74 AT&T Inc.
Current maturities of long-term debt include debt that may be
put back to us by the holders in 2011. We have $1,000 of
annual put reset securities issued by BellSouth that may be
put each April until maturity in 2021. If the holders do not
require us to repurchase the securities, the interest rate will
be reset based on current market conditions. Likewise, we
have an accreting zero-coupon note that may be redeemed
each May, excluding May 2011, until maturity in 2022. If the
zero-coupon note (issued for principal of $500 in 2007) is
held to maturity, the redemption amount will be $1,030.
Debt maturing within one year consisted of the following at
December 31:
2010 2009
Current maturities of long-term debt $5,544 $7,328
Commercial paper 1,625 —
Bank borrowings1 27 33
Total $7,196 $7,361
1Outstanding balance of short-term credit facility of a foreign subsidiary.
During 2010, we received net proceeds of $2,235 from the
issuance of $2,250 of 2.50% global notes due in 2015. Debt
proceeds were used for general corporate purposes. We also
received net proceeds of $1,620 from the net issuance of
commercial paper and other short-term bank borrowings.
During 2010, debt repayments totaled $9,294 and consisted of:
 •$5,668inrepaymentsoflong-termdebtwithaweighted-
average interest rate of 2.86%.
 •$3,000fortheearlyredemptionoftheNewCingular
Wireless Services, Inc. 7.875% notes originally due on
March 1, 2011.
 •$594relatedtotheprivateexchangewecompletedon
September 2, 2010 whereby holders exchanged $1,362
of New Cingular Wireless Services, Inc. 8.75% senior
notes due 2031 and $1,537 of AT&T Corp. (ATTC) 8.00%
senior notes due 2031 for $3,500 of new 5.35% AT&T Inc.
global notes due 2040 plus a cash payment.
 •$32inrepaymentsofcapitalizedleases.
As of December 31, 2010 and 2009, we were in compliance
with all covenants and conditions of instruments governing
our debt. Substantially all of our outstanding long-term debt
is unsecured. Maturities of outstanding long-term notes and
debentures, as of December 31, 2010, and the corresponding
weighted-average interest rate scheduled for repayment are
as follows:
There-
2011 2012 2013 2014 2015 after
Debt
repayments1 $5,535 $5,454 $5,823 $4,788 $4,514 $38,042
Weighted-
average
interest rate 6.2% 6.4% 5.6% 5.1% 4.3% 6.4%
1
Debt repayments assume putable debt is redeemed by the holders at the next
opportunity.
The following table is a reconciliation of our investments in
equity affiliates as presented on our consolidated balance
sheets:
2010 2009
Beginning of year $2,921 $2,332
Additional investments 220 44
Equity in net income of affiliates 762 734
Dividends received (159) (315)
Dispositions (204) —
Currency translation adjustments 203 125
Telmex Internacional exchange 658 —
Other adjustments 114 1
End of year $4,515 $2,921
Undistributed earnings from equity affiliates were $5,137
and $4,534 at December 31, 2010 and 2009. The currency
translation adjustment for 2010 and 2009 reflects the effect
of exchange rate fluctuations on our investments in Telmex,
TI and América Móvil.
The fair value of our investment in Telmex, based on the
equivalent value of Telmex L shares at December 31, 2010,
was $1,231. The fair value of our investment in América Móvil,
based on the equivalent value of América Móvil L shares at
December 31, 2010, was $10,383.
NOTE 8. DEBT
Long-term debt of AT&T and its subsidiaries, including interest
rates and maturities, is summarized as follows at December31:
2010 2009
Notes and debentures
Interest Rates Maturities1
0.35% – 2.99% 2010 – 2015 $ 2,250 $ 3,500
3.00% – 4.99% 2010 – 2014 5,880 5,853
5.00% – 6.99% 2010 – 2095 43,506 41,331
7.00% – 9.10% 2010 – 2097 11,986 19,069
Other 14 136
Fair value of interest rate swaps
recorded in debt 435 310
64,071 70,199
Unamortized premium, net of discount 185 1,612
Total notes and debentures 64,256 71,811
Capitalized leases 259 237
Total long-term debt, including
current maturities 64,515 72,048
Current maturities of long-term debt (5,544) (7,328)
Total long-term debt $58,971 $64,720
1Maturities assume putable debt is redeemed by the holders at the next opportunity.