Oracle 2010 Annual Report Download - page 115

Table of Contents
ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2011
We were in compliance with all debt-related covenants at May 31, 2011. Future principal payments for all of our borrowings at May 31, 2011 were as follows (in
millions):
Fiscal 2012 $ 1,150
Fiscal 2013 1,250
Fiscal 2014 —
Fiscal 2015 1,500
Fiscal 2016 2,000
Thereafter 10,000
Total $15,900
Commercial Paper Program & Commercial Paper Notes
We entered into a commercial paper program in February 2006 (amended in May 2008) via dealer agreements with Banc of America Securities LLC and JP
Morgan Securities, Inc. and an Issuing and Paying Agency Agreement entered into in February 2006 with JPMorgan Chase Bank, National Association (CP
Program). On May 11, 2010, we reduced the overall capacity of our CP Program from $5.0 billion to $3.0 billion. Our ability to issue commercial paper notes in
the future is highly dependent upon our ability to provide a “back-stop” by means of a revolving credit facility or other debt facility for amounts equal to or
greater than the amounts of commercial paper notes we intend to issue. While presently we have no such facilities in place that may provide a back-stop to such
commercial paper notes (see additional discussion under “Revolving Credit Agreements” below), we currently believe that, if needed, we could put in place one
or more additional revolving credit facilities or other debt facility in a timely manner and on commercially reasonable terms.
During fiscal 2010, we issued $2.8 billion of unsecured short-term commercial paper notes pursuant to the CP Program (none in fiscal 2011 and 2009). As of
May 31, 2011, we had no commercial paper notes outstanding compared to $881 million outstanding as of May 31, 2010.
Revolving Credit Agreements
On May 27, 2011, we entered into two revolving credit agreements with BNP Paribas, as initial lender and administrative agent; and BNP Paribas Securities
Corp., as sole lead arranger and sole bookrunner (the 2011 Credit Agreements) to borrow $1.15 billion pursuant to these agreements. The 2011 Credit
Agreements provided us with short-term borrowings for working capital and other general corporate purposes. Interest for the 2011 Credit Agreements is based
on either (x) a “base rate” calculated as the highest of (i) BNP Paribas’s prime rate, (ii) the federal funds effective rate plus 0.50% and (iii) the LIBOR for
deposits in U.S. dollars plus 1% or (y) LIBOR for deposits made in U.S. dollars plus 0.25%, depending on the type of borrowings made by us. Any amounts
borrowed pursuant to the 2011 Credit Agreements are due no later than June 30, 2011, which is the termination date of the 2011 Credit Agreements.
The 2011 Credit Agreements contain certain customary representations, warranties and guarantees, covenants and pledges of certain assets made by us and our
subsidiaries. Events of default result in the requirement to pay additional interest. If any of the events of default occur and are not cured, any unpaid amounts
under the 2011 Credit Agreements may be declared immediately due and payable and the 2011 Credit Agreements may be terminated. We were in compliance
with the 2011 Credit Agreements’ covenants as of May 31, 2011.
On March 14, 2011, our $3.0 billion, five-year Revolving Credit Agreement dated March 15, 2006, among Oracle and the lenders named therein (the 2006 Credit
Agreement) expired pursuant to its terms. No debt was outstanding pursuant to the 2006 Credit Agreement as of its date of expiration.
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Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research℠