Intel 2009 Annual Report Download - page 97

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 a total
return swap agreement that effectively converts the fixed-rate obligation on the bonds to a floating U.S.-dollar LIBOR-based
rate. At the beginning of the first quarter of 2008, we elected to account for the 2007 Arizona bonds at fair value. For further
discussion, see “Note 5: Fair Value.”
As of December 26, 2009, our aggregate debt maturities based on outstanding principal were as follows (in millions):
Substantially all of the difference between the total aggregate debt maturities above and the total carrying amount of our debt
is due to the equity component of our convertible debentures.
Note 21: Retirement Benefit Plans
Profit Sharing Plans
We provide tax-qualified profit sharing retirement plans for the benefit of eligible employees, former employees, and retirees
in the U.S. and certain other countries. The plans, which are funded by annual discretionary contributions by Intel, are
designed to provide employees with an accumulation of funds for retirement on a tax-deferred basis. Our Chief Executive
Officer (CEO) determines the amounts to be contributed to the U.S. Profit Sharing Plan under delegation of authority from our
Board of Directors, pursuant to the terms of the Profit Sharing Plan. As of December 26, 2009, 51% of our U.S. Profit Sharing
Fund was invested in equities, and 49% was invested in fixed-income instruments. Most assets are managed by external
investment managers.
For the benefit of eligible U.S. employees, we also provide a non-tax-qualified supplemental deferred compensation plan for
certain highly compensated employees. This plan is designed to permit certain discretionary employer contributions and to
permit employee deferral of a portion of compensation in excess of certain tax limits. This plan is unfunded.
We expensed $260 million for the qualified and non-qualified U.S. profit sharing retirement plans in 2009 ($289 million in
2008 and $302 million in 2007). In the first quarter of 2010, we funded $265 million for the 2009 contribution to the qualified
U.S. Profit Sharing Plan.
Pension and Postretirement Benefit Plans
U.S. Pension Benefits. We provide a tax-qualified defined-benefit pension plan for the benefit of eligible employees, former
employees, and retirees in the U.S. The plan provides for a minimum pension benefit that is determined by a participant’s
years of service and final average compensation (taking into account the participant
’s social security wage base), reduced by
the participant’s balance in the U.S. Profit Sharing Plan. If we do not continue to contribute to, or significantly reduce
contributions to, the U.S. Profit Sharing Plan, the projected benefit obligation of the U.S. defined-benefit plan could increase
significantly.
86
Year Payable
2010
$
157
2011
—
2012
—
2013
—
2014
—
2015 and thereafter
3,725
Total
$
3,882