Ingram Micro 2000 Annual Report Download - page 34

increased flexibility for the Company to make incremental investments in strategic growth initiatives and to manage working
capital requirements.
The Company also has certain other facilities relating to accounts receivable in Europe and Canada which provide up to
approximately $260 million of additional financing capacity. Under these programs, the Company had sold approximately $210
million and $188 million of trade accounts receivable in the aggregate at December 30,2000 and January 1, 2000, respectively,
resulting in a further reduction of total trade accounts receivable on the Company’s consolidated balance sheet.
The aggregate amount of trade accounts receivable sold as of December 30, 2000 and January 1, 2000 totaled approximately
$910 million and $263 million, respectively. Proceeds from these accounts receivable facilities are generally used to repay existing
indebtedness.The Company believes that there are sufficient trade accounts receivable to support the U.S., European and Canadian
accounts receivable facilities.
On June 9,1998, the Company sold $1.33 billion aggregate principal amount at maturity of its Zero Coupon Convertible
Senior Debentures due 2018 in a private placement.The Company subsequently registered the resale of these debentures with the
SEC and they are now generally saleable under Rule 144. Gross proceeds from this offering were $460.4 million.The debentures
were sold at an issue price of $346.18 per $1,000 principal amount at maturity (representing a yield to maturity of 5.375% per
annum),and are convertible into shares of the Company’s Class A Common Stock at a rate of 5.495 shares per $1,000 principal
amount at maturity, subject to adjustment under certain circumstances.
In 2000 and 1999, the Company repurchased outstanding Zero Coupon Convertible Senior Debentures with a total carrying
value of $235.2 million and $56.5 million, respectively, as of their repurchase dates for approximately $231.3 million and $50.3
million in cash, respectively.The debenture repurchases resulted in extraordinary gains of $2.4 million and $3.8 million in 2000
and 1999, respectively, net of $1.5 million and $2.4 million in income taxes, respectively.
At December 30, 2000,there were $220.0 million of Zero Coupon Convertible Debentures outstanding that were convertible
into approximately 3.1 million shares of the Company’s Class A Common Stock.The debentures are redeemable at the option of
the Company on or after June 9, 2003, at the issue price plus accrued original issue discount to the date of the redemption. Each
debenture is subject to repurchase at the option of the holder as of June 9, 2001,June 9, 2003,June 9, 2008, or June 9,2013, or
if there is a Fundamental Change (as defined), at the issue price plus accrued original issue discount to the date of the redemption.
In the event of a repurchase at the option of the holder (other than upon a Fundamental Change), the Company may, at its option,
satisfy the redemption in cash or Class A Common Stock,or any combination thereof. In the case of any such repurchase as of June
9, 2001, the Company may elect, in lieu of the payment of cash or Class A Common Stock, to satisfy the redemption in new Zero
Coupon Convertible Senior Debentures due 2018.
The Company and its foreign subsidiaries have additional lines of credit, commercial paper, short-term overdraft facilities and
other credit facilities with various financial institutions worldwide, which provide for borrowings aggregating approximately $750
million at December 30, 2000.Most of these arrangements are on an uncommitted basis and are reviewed periodically for renewal.
At December 30,2000, the Company had $250.1 million outstanding under these facilities.
The proceeds from stock option exercises provide an additional source of cash to the Company. In 2000, 1999,and 1998,
respectively, cash proceeds from the exercise of stock options, including applicable tax benefits, totaled $13.1 million,$20.8
million, and $93.9 million, respectively.
The Company believes that existing cash resources and cash provided by operating activities,supplemented as necessary with
funds available under credit arrangements will provide sufficient resources to meet its present and future working capital and cash
requirements for at least the next 12 months.
Capital expenditures
The Company presently expects to spend approximately $145 million in fiscal 2001 for capital expenditures due to continued
expansion of its business.
N e w a c c o u n t i n g s t a n d a r d s
Refer to Note 2 of the Company’s consolidated financial statements for the discussion of new accounting standards.
|.2 7
INGRAM MICRO