HP 2013 Annual Report Download - page 136

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 12: Borrowings (Continued)
HP may redeem some or all of the fixed-rate U.S. Dollar Global Notes set forth in the above table
at any time in accordance with the terms thereof. The U.S. Dollar Global Notes are senior unsecured
debt.
In May 2012, HP filed a shelf registration statement (the ‘‘2012 Shelf Registration Statement’’)
with the Securities and Exchange Commission (‘‘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 2012 Shelf Registration Statement replaced the
registration statement filed in May 2009.
HP’s Board of Directors has authorized the issuance of up to $16.0 billion in aggregate principal
amount of commercial paper by HP. HP’s subsidiaries are authorized to issue up to an additional
$1.0 billion in aggregate principal amount of commercial paper. HP maintains two commercial paper
programs, and a wholly owned subsidiary maintains a third program. HP’s U.S. program provides for
the issuance of U.S. dollar-denominated commercial paper up to a maximum aggregate principal
amount of $16.0 billion. HP’s euro commercial paper program, which was established in September
2012, provides for the issuance of commercial paper outside of the United States denominated in U.S.
dollars, euros or British pounds up to a maximum aggregate principal amount of $3.0 billion or the
equivalent in those alternative currencies. The combined aggregate principal amount of commercial
paper outstanding under those programs at any one time cannot exceed the $16.0 billion authorized by
HP’s Board of Directors. The HP subsidiary’s Euro Commercial Paper/Certificate of Deposit
Programme provides for the issuance of commercial paper in various currencies up to a maximum
aggregate principal amount of $500 million.
HP maintains senior unsecured committed credit facilities primarily to support the issuance of
commercial paper. HP has a $3.0 billion five-year credit facility that expires in March 2017 and a
$4.5 billion four-year credit facility that expires in February 2015. Both facilities support the U.S.
commercial paper program and the euro commercial paper program. In addition, the five-year credit
facility was amended in September 2012 to permit borrowings in euros and British pounds, with the
amounts available in euros and pounds being limited to the U.S. dollar equivalent of $2.2 billion and
$300 million, respectively. Commitment fees, interest rates and other terms of borrowing under the
credit facilities vary based on HP’s external credit ratings. HP’s ability to have an outstanding U.S.
commercial paper balance that exceeds the $7.5 billion supported by these credit facilities is subject to
a number of factors, including liquidity conditions and business performance.
Within Other, including capital lease obligations, are borrowings that are collateralized by certain
financing receivable assets. As of October 31, 2013 and October 31, 2012, the carrying value of the
assets approximated the carrying amount of the borrowings of $244 million and $225 million,
respectively.
As of October 31, 2013, HP had the capacity to issue an unspecified amount of additional debt
securities, common stock, preferred stock, depositary shares and warrants under the 2012 Shelf
Registration Statement. As of that date, HP also had up to $17.8 billion of available borrowing
resources, including $16.2 billion in available capacity under its commercial paper programs and
$1.6 billion relating to uncommitted lines of credit. The extent to which HP is able to utilize the 2012
Shelf Registration Statement and the commercial paper programs as sources of liquidity at any given
time is subject to a number of factors, including market demand for HP securities and commercial
paper, HP’s financial performance, HP’s credit ratings and market conditions generally.
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