Cisco 2014 Annual Report Download - page 71

Borrowings
Senior Notes The following table summarizes the principal amount of our senior notes (in millions):
Maturity Date July 26, 2014 July 27, 2013
Senior notes:
Floating-rate notes:
Three-month LIBOR plus 0.25% .... March 14, 2014 $— $ 1,250
Three-month LIBOR plus 0.05% .... September 3, 2015 (1) 850 —
Three-month LIBOR plus 0.28% .... March 3, 2017 (1) 1,000 —
Three-month LIBOR plus 0.50% .... March 1, 2019 (1) 500 —
Fixed-rate notes:
1.625% ........................ March 14, 2014 —2,000
2.90% ......................... November 17, 2014 500 500
5.50% ......................... February 22, 2016 3,000 3,000
1.10% ......................... March 3, 2017 (1) 2,400 —
3.15% ......................... March 14, 2017 750 750
4.95% ......................... February 15, 2019 2,000 2,000
2.125% ........................ March 1, 2019 (1) 1,750 —
4.45% ......................... January 15, 2020 2,500 2,500
2.90% ......................... March 4, 2021 (1) 500 —
3.625% ........................ March 4, 2024 (1) 1,000 —
5.90% ......................... February 15, 2039 2,000 2,000
5.50% ......................... January 15, 2040 2,000 2,000
Total ...................... $20,750 $16,000
(1) In March 2014, we issued senior notes with an aggregate principal amount of $8.0 billion.
We repaid senior floating-rate and fixed-rate notes upon their maturity in the third quarter of fiscal 2014 for an aggregate
principal amount of $3.3 billion.
Interest is payable semiannually on each class of the senior fixed-rate notes, each of which is redeemable by us at any time,
subject to a make-whole premium. Interest is payable quarterly on the floating-rate notes. We were in compliance with all debt
covenants as of July 26, 2014.
Other Debt Other debt as of July 26, 2014 and July 27, 2013 includes secured borrowings associated with customer financing
arrangements. As of July 27, 2013, we also had outstanding notes related to our investment in Insieme. The amount of
borrowings outstanding under these arrangements was $12 million and $31 million as of July 26, 2014 and July 27, 2013,
respectively.
Commercial Paper In fiscal 2011, we established a short-term debt financing program of up to $3.0 billion through the
issuance of commercial paper notes. We use the proceeds from the issuance of commercial paper notes for general corporate
purposes. In fiscal 2014, we issued and repaid $1.0 billion of indebtedness under commercial paper and had no commercial
paper notes outstanding as of each of July 26, 2014 and July 27, 2013.
Credit Facility On February 17, 2012, we entered into a credit agreement with certain institutional lenders that provides for a
$3.0 billion unsecured revolving credit facility that is scheduled to expire on February 17, 2017. Any advances under the credit
agreement will accrue interest at rates that are equal to, based on certain conditions, either (i) the higher of the Federal Funds
rate plus 0.50%, Bank of America’s “prime rate” as announced from time to time, or one-month LIBOR plus 1.00% or
(ii) LIBOR plus a margin that is based on our senior debt credit ratings as published by Standard & Poor’s Financial Services,
LLC and Moody’s Investors Service, Inc. The credit agreement requires that we comply with certain covenants, including that
we maintain an interest coverage ratio as defined in the agreement. As of July 26, 2014, we were in compliance with the
required interest coverage ratio and the other covenants, and we had not borrowed any funds under the credit facility.
We may also, upon the agreement of either the existing lenders or additional lenders not currently parties to the agreement,
increase the commitments under the credit facility by up to an additional $2.0 billion and/or extend the expiration date of the
credit facility by up to two additional years, or up to February 17, 2019.
63