HP 2010 Annual Report Download - page 127

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 13: Borrowings (Continued)
2010 2009
In millions
$1,100 issued at discount to par of 99.921% in September 2010 at 1.25% due
September 2013 ............................................ 1,099 —
$1,100 issued at discount to par of 99.887% in September 2010 at 2.125% due
September 2015 ............................................ 1,099 —
14,515 12,514
EDS Senior Notes
$1,100 issued June 2003 at 6.0%, due August 2013 ...................... 1,130 1,140
$300 issued October 1999 at 7.45%, due October 2029 .................... 315 315
1,445 1,455
Other, including capital lease obligations, at 0.59%-8.63%, due in calendar year
2010-2024 .................................................... 845 785
Fair value adjustment related to hedged debt ............................ 669 369
Less: current portion .............................................. (2,216) (1,143)
Total long-term debt .............................................. $15,258 $13,980
As disclosed in Note 9 to the Consolidated Financial Statements, HP uses interest rate swaps to
mitigate the market risk exposures in connection with certain fixed interest global notes to achieve
primarily U.S. dollar LIBOR-based floating interest expense. The table above does not reflect the
interest rate swap impact on the interest rate.
HP may redeem some or all of the Global Notes set forth in the above table at any time at the
redemption prices described in the prospectus supplements relating thereto. The Global Notes are
senior unsecured debt.
In May 2009, HP filed a shelf registration statement (the ‘‘2009 Shelf Registration Statement’’)
with the SEC to enable the company to offer for sale, from time to time, in one or more offerings, an
unspecified amount of debt securities, common stock, preferred stock, depositary shares and warrants.
The 2009 Shelf Registration Statement replaced other registration statements filed in March 2002 and
May 2006.
In May 2008, HP’s Board of Directors approved an increase in the capacity of HP’s U.S.
commercial paper program by $10.0 billion to $16.0 billion. HP’s subsidiaries are authorized to issue up
to an additional $1.0 billion of commercial paper, of which $500 million of capacity is currently
available to be used by Hewlett-Packard International Bank PLC, a wholly-owned subsidiary of HP, for
its Euro Commercial Paper/Certificate of Deposit Programme.
HP has a $3.0 billion five-year credit facility expiring in May 2012. In February 2009, HP entered
into a $3.5 billion 364-day credit facility. The February credit facility expired in February 2010, at which
time HP entered into a new $3.5 billion 364-day credit facility maintaining the total amount available
under its credit facilities at $6.5 billion. Commitment fees, interest rates and other terms of borrowing
under the credit facilities vary based on HP’s external credit ratings. The credit facilities are senior
unsecured committed borrowing arrangements primarily to support the issuance of U.S. commercial
paper. HP’s ability to have a U.S. commercial paper outstanding balance that exceeds the $6.5 billion
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