Oki 2002 Annual Report Download - page 27

Oki Electric Industry Co., Ltd. Annual Report 2002 25
At March 31, 2002, short-term and long-term debt of ¥2,296 million
($17,263 thousand) in the aggregate was collateralized by property, plant
and equipment which amounted to ¥2,217 million ($16,675 thousand).
As is customary in Japan, both short-term and long-term bank loans
are made under general agreements which provide that collateral and
guarantees (or additional collateral or guarantees, as appropriate) with
respect to present and future indebtedness will be given at the request of
a lending bank, and that the bank shall have the right, as the obligations
become due or in the event of default, to offset any cash deposited
against such obligations.
Convertible bonds, unless previously redeemed, are convertible into
shares of common stock of the Company at the following conversion
price:
Conversion
price per share Conversion period
2.2% bonds in yen due 2004 ...... ¥1,050.00 November 1, 1988,
.............................................. to March 30, 2004
The bonds are redeemable at the Company’s option, in whole or in
part, at the following redemption prices together with the accrued
interest to the date of redemption:
Redemption price
(% of the
principal amount) Redeemable on or after
2.2% bonds due 2004 ................. 106%–100%1/2April 1, 1997
Under the terms of the issues, the conversion prices of the convertible
bonds are subject to adjustment in certain cases which include stock splits.
A sufficient number of shares of common stock are reserved for the
conversion of all outstanding convertible bonds.
The aggregate annual maturities of long-term debt subsequent to
March 31, 2002 are summarized as follows:
Thousands of
Year ending March 31 Millions of yen U.S. dollars
2003 ............................................................... ¥049,815 $0,374,550
2004 ............................................................... 58,295 438,314
2005 ............................................................... 44,567 335,090
2006 ............................................................... 38,493 289,427
2007 and thereafter ........................................ 57,598 433,074
....................................................................... ¥248,770 $1,870,458
The Group has access to substantial sources of funds at numerous
banks worldwide. The total unused credit available to the Group at
March 31, 2002 was ¥115,235 million ($866,429 thousand) including
¥32,000 million ($240,601 thousand) of credit commitments with vari-
ous Japanese banks. The Company compensates the banks for the credit
commitments in the form of fees which were insignificant.
7. Retirement benefits
The Group has noncontributory defined benefit pension plans, contribu-
tory defined benefit pension plans pursuant to the Welfare Pension
Insurance Law of Japan, and lump-sum retirement payment plans which
cover substantially all employees who terminate their employment with
the Group. The Oki Electric Industries Welfare Pension Fund estab-
lished by the Company has become the multi-employers’ fund (the
“Fund”) which 35 consolidated subsidiaries have joined. Certain foreign
consolidated subsidiaries have defined benefits and defined contribution
pension plans. In addition, eligible employees, upon termination of their
employment with the Group, may receive certain additional payments
under the plans.
4. Inventories
Inventories at March 31, 2000 and 2001 were as follows:
Thousands of
Millions of yen U.S. dollars
2002 2001 2002
Finished goods ........................... ¥050,229 ¥056,375 $0,377,663
Work in process ......................... 60,580 50,379 455,491
Raw materials and supplies ....... 39,384 49,207 296,127
............................................. ¥150,194 ¥155,963 $1,129,282
5. Investments in and advances to unconsolidated
subsidiaries and affiliates
Investments in and advances to unconsolidated subsidiaries and
affiliates at March 31, 2002 and 2001 were as follows:
Thousands of
Millions of yen U.S. dollars
.................................................... 2002 2001 2002
Investments stated:
By the equity method ........... ¥3,698 ¥3,900 $27,807
At cost or less ....................... 4,424 4,748 33,263
Advances ................................... 1,203 1,058 9,047
.............................................. ¥9,325 ¥9,708 $70,118
6. Short-term borrowings and long-term debt
Short-term borrowings are generally unsecured and represent notes. The
weighted average interest rates for the years ended March 31, 2002 and
2001 were approximately 1.0% and 1.3%, respectively.
Long-term debt at March 31, 2002 and 2001 is summarized as follows:
Thousands of
Millions of yen U.S. dollars
.................................................... 2002 2001 2002
Loans from banks, insurance
companies and government
agencies, due through 2022
at rates of up to 6.6%:
Secured ................................. ¥002,280 ¥002,760 $0,017,142
Unsecured ............................. 129,413 95,239 973,037
.............................................. 131,693 97,999 990,180
Unsecured convertible bonds:
2.2% bonds in
yen due 2004 ...................... 32,188 32,188 242,015
1.8% bonds in
yen due 2001 ...................... —17,543 —
Unsecured bonds in yen:
3.05% bonds due 2003 ......... 7,889 8,700 59,315
3.05% bonds due 2002 ......... 14,600 15,100 109,774
3.15% bonds due 2006 ......... 20,000 20,000 150,375
2.175% bonds due 2002 ....... 7,900 8,200 59,398
2.65% bonds due 2007 ......... 9,500 10,000 71,428
Floating rate*
bonds due 2004 ................... 5,000 5,000 37,593
3.00% bonds due 2005 ......... 10,000 10,000 75,187
2.82% bonds due 2004 ......... 10,000 10,000 75,187
2.00% bonds due 2001 ......... —4,900 —
.............................................. 248,770 239,630 1,870,458
Less: Current portion ................. (49,815) (42,789) (374,550)
.............................................. ¥198,955 ¥196,841 $1,495,907
*Represents a rate linked to a yen interest rate swap for 10 years (1.858% as of the date of
issuance of the bonds).