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Table of Contents
INTEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In 2007, we guaranteed repayment of principal and interest on bonds issued by the Industrial Development Authority of the
City of Chandler, Arizona, which constitute an unsecured general obligation for Intel. The aggregate principal amount of the
bonds issued in December 2007 (2007 Arizona bonds) is $125 million due in 2037, and the bonds bear interest at a fixed rate
of 5.3%. The 2007 Arizona bonds are subject to mandatory tender, at our option, on any interest payment date beginning on or
after December 1, 2012 until their final maturity on December 1, 2037. Upon such tender, we can re-market the bonds as
either fixed-rate bonds for a specified period or as variable-rate bonds until their final maturity. We also entered into an
interest rate swap agreement, from a fixed rate to a floating LIBOR-based return. At the beginning of the first quarter of 2008,
we elected the provisions of SFAS No. 159, and we will record the 2007 Arizona bonds at fair value at each reporting date. As
a result, changes in the fair value of this debt will be primarily offset by changes in the fair value of the interest rate swap,
without the need to apply the hedge accounting provisions of SFAS No. 133.
We have euro borrowings, which we made in connection with financing manufacturing facilities and equipment in Ireland. We
have invested the proceeds in euro-denominated loan participation notes of similar maturity to reduce currency and interest
rate exposures. During 2006, we retired approximately $300 million in euro borrowings prior to their maturity dates through
the simultaneous settlement of an equivalent amount of investments in loan participation notes.
At December 29, 2007, our aggregate debt maturities were as follows (in millions):
Note 7: Investments
Trading Assets
Trading assets outstanding at fiscal year-ends were as follows:
We designate floating-rate securitized financial instruments, such as asset-backed securities, that we purchased after
December 30, 2006 as trading assets. As of December 29, 2007, the estimated fair value of these securitized financial
instruments was $926 million.
Net gains on marketable debt instruments that we classified as trading assets held at the reporting date were $19 million in
2007 (gains of $31 million in 2006 and losses of $47 million in 2005). Net losses on the related derivatives were $37 million
in 2007 (losses of $22 million in 2006 and gains of $52 million in 2005). Certain equity securities within the trading assets
portfolio are maintained to generate returns that seek to offset changes in liabilities related to the equity market risk of certain
deferred compensation arrangements. These deferred compensation liabilities were $483 million in 2007 ($416 million in
2006), and are included in other accrued liabilities. Net gains on equity securities offsetting deferred compensation
arrangements still held at the reporting date were $28 million in 2007 ($45 million in 2006 and $15 million in 2005).
67
Year Payable
2008
$
2
2009
2
2010
160
2011
2
2012
2
2013 and thereafter
1,814
Total
$
1,982
2007
2006
Net
Net
Unrealized
Estimated
Unrealized
Estimated
(In Millions)
Gains
Gains
Marketable debt instruments
$
51
$
2,074
$
40
$
684
Equity securities offsetting deferred compensation
163
492
138
450
Total trading assets
$
214
$
2,566
$
178
$
1,134