CVS 2011 Annual Report Download - page 64

Notes to Consolidated Financial Statements
CVS CAREMARK 62 2011 ANNUAL REPORT
$60 million of the Trust Preferred Securities at par and
intends to repay the remaining $50 million at par in 2012.
On May 12, 2011, the Company issued $550 million of
4.125% unsecured senior notes due May 15, 2021 and
issued $950 million of 5.75% unsecured senior notes due
May 15, 2041 (collectively, the “2011 Notes”) for total pro-
ceeds of approximately $1.5 billion, net of discounts and
underwriting fees. The 2011 Notes pay interest semi-annually
and may be redeemed, in whole at any time, or in part from
time to time, at the Company’s option at a defined redemp-
tion price plus accrued and unpaid interest to the redemp-
tion date. The net proceeds of the 2011 Notes were used to
repay commercial paper borrowings and certain other corpo-
rate debt, and were used for general corporate purposes.
On December 8, 2011, the Company repurchased $958 mil-
lion of the principal amount of its Enhanced Capital
Advantaged Preferred Securities (“ECAPS”) at par. The fees
and write-off of deferred issuance costs associated with
the early extinguishment of the ECAPS were de minimis.
The remaining $42 million of outstanding ECAPS are due
In connection with its commercial paper program, the
Company maintains a $1.25 billion, five-year unsecured
back-up credit facility, which expires on March 12, 2012,
a $1.0 billion, three-year unsecured back-up credit facility
which expires on May 27, 2013, and a $1.25 billion, four-
year unsecured back-up credit facility which expires on
May 12, 2015. The credit facilities allow for borrowings at
various rates depending on the Company’s public debt rat-
ings and require the Company to pay a weighted average
quarterly facility fee of approximately 0.04%, regardless of
usage. As of December 31, 2011 and 2010, the Company
had no outstanding borrowings against the back-up credit
facilities. The weighted average interest rate for short-term
debt was 0.37% as of December 31, 2011 and 0.40% as
of December 31, 2010.
In connection with the Company’s acquisition of the UAM
Medicare Part D Business in April 2011, the Company
assumed $110 million of long-term debt in the form of Trust
Preferred Securities that mature through 2037. During the
year ended December 31, 2011, the Company repaid
6 BORROWING AND CREDIT AGREEMENTS
The following table is a summary of the Company’s borrowings as of December 31:
in millions 2011 2010
Commercial paper $ 750 $ 300
5.75% senior notes due 2011 — 800
Floating rate notes due 2011 — 300
4.875% senior notes due 2014 550 550
3.25% senior notes due 2015 550 550
6.125% senior notes due 2016 700 700
5.75% senior notes due 2017 1,750 1,750
6.6% senior notes due 2019 1,000 1,000
4.75% senior notes due 2020 450 450
4.125% senior notes due 2021 550 —
6.25% senior notes due 2027 1,000 1,000
Trust Preferred Securities due 2037 50 —
6.125% senior notes due 2039 1,500 1,500
5.75% senior notes due 2041 950 —
6.302% Enhanced Capital Advantage
Preferred Securities due 2062 42 1,000
Mortgage notes payable 4 6
Capital lease obligations 168 151
10,014 10,057
Less:
Short-term debt (commercial paper) (750) (300)
Current portion of long-term debt (56) (1,105)
$ 9,208 $ 8,652
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