Hasbro 2014 Annual Report Download - page 87

HASBRO, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements — (Continued)
(Thousands of Dollars and Shares Except Per Share Data)
based on market conditions and the ratings assigned to the notes by the credit rating agencies at the time of
issuance. At December 28, 2014, the Company had notes outstanding under the Program of $239,976 with a
weighted average interest rate of 0.44%. There were no notes outstanding under the Program at December 29,
2013.
(8) Accrued Liabilities
Components of accrued liabilities are as follows:
2014 2013
Royalties ....................................................... $ 83,217 168,950
Advertising ..................................................... 78,530 84,815
Payroll and management incentives .................................. 82,774 73,970
Other .......................................................... 365,383 400,024
Total accrued liabilities ............................................ $609,904 727,759
(9) Long-Term Debt
Components of long-term debt are as follows:
2014 2013
Carrying
Cost
Fair
Value
Carrying
Cost
Fair
Value
6.35% Notes Due 2040 ................... $ 500,000 617,700 500,000 532,750
6.30% Notes Due 2017 ................... 350,000 387,660 350,000 400,050
5.10% Notes Due 2044 ................... 300,000 316,980 — —
3.15% Notes Due 2021 ................... 300,000 302,700 — —
6.60% Debentures Due 2028 ............... 109,895 128,698 109,895 118,566
6.125% Notes Due 2014 .................. — — 428,390 435,838
Total long-term debt ..................... 1,559,895 1,753,738 1,388,285 1,487,204
Less: Current portion ..................... — — 428,390 435,838
Long-term debt excluding current portion .... $1,559,895 1,753,738 959,895 1,051,366
In May 2014, the Company issued $600,000 in long-term debt which consists of $300,000 of 3.15% Notes
Due in 2021 and $300,000 of 5.10% Notes Due in 2044 (collectively, the “Notes”). The Company may redeem
the Notes at its option at the greater of the principal amount of the Notes or the present value of the remaining
scheduled payments discounted using the effective interest rate on applicable U.S. Treasury bills at the time of
repurchase. Prior to the issuance of the Notes, the Company held forward-starting interest rate swap contracts to
hedge the variability in the anticipated underlying U.S. Treasury interest rate associated with the expected
issuance of the Notes. At the date of issuance, these contracts were terminated and the Company paid $33,306,
the fair value of the contracts on that date, to settle. Of this amount, $6,373 related to 3.15% Notes Due 2021 and
$26,933 related to 5.10% Notes Due 2044, which have been deferred in AOCE and are being amortized to
interest expense over the life of the respective Notes using the effective interest rate method. The proceeds from
the Notes have been presented net of the payment for these contracts in the consolidated statements of cash
flows.
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