Oracle 2010 Annual Report Download - page 74

Table of Contents
days of the contracts’ dates of execution. We record the transfers of amounts due from customers to financial institutions as sales of financial assets because we
are considered to have surrendered control of these financial assets. We financed $1.5 billion, $1.2 billion and $1.4 billion or approximately 16%, 16% and 19%,
respectively, of our new software license revenues in fiscal 2011, 2010 and 2009, respectively, and $117 million, or approximately 3%, of our hardware systems
products revenues in fiscal 2011.
Recent Financing Activities
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. Additional details regarding the 2011 Credit Agreements are included in Note 8 of Notes to Consolidated Financial Statements included elsewhere
in this Annual Report.
On March 14, 2011, our $3.0 billion, five-year Revolving Credit Agreement dated March 15, 2006, among Oracle; the lenders named therein, Wells Fargo Bank,
National Association, as administrative agent, Bank of America N.A. as syndication agent; the documentation agents named therein, and Wells Fargo Securities,
LLC, and Banc of America Securities LLC, as joint lead arrangers and joint bookrunners (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.
Senior Notes: As of May 31, 2011, we had $14.8 billion of senior notes outstanding ($13.8 billion outstanding as of May 31, 2010). In January 2011, our
5.00% fixed rate senior notes for $2.25 billion matured and were repaid. In July 2010, we issued $3.25 billion of fixed rate senior notes comprised of $1.0 billion
of 3.875% notes due July 2020 and $2.25 billion of 5.375% notes due July 2040. We issued these senior notes in order to repay indebtedness, including the
repayment of our $2.25 billion of senior notes that matured in January 2011, for general corporate purposes, for future acquisitions and in order to replenish cash
used to repay $1.0 billion of the floating rate senior notes that matured in May 2010. Additional details regarding these senior notes and all other borrowings are
included in Note 8 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report.
Commercial Paper Notes: During fiscal 2011, we repaid $881 million of commercial paper notes that were issued in fiscal 2010 pursuant to our commercial
paper program, which allows us to issue and sell unsecured short-term promissory notes pursuant to a private placement exemption from the registration
requirements under federal and state securities laws. As of May 31, 2011, we had no commercial paper notes outstanding ($881 million outstanding as of
May 31, 2010).
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, we currently believe that, if needed, we could put in place one or more additional revolving
credit or similar debt facilities in a timely manner and on commercially reasonable terms.
Common Stock Repurchases: Our Board of Directors has approved a program for us to repurchase shares of our common stock. On October 20, 2008, we
announced that our Board of Directors expanded our repurchase program by $8.0 billion and as of May 31, 2011, $4.1 billion was available for share repurchases
pursuant to our stock repurchase program. We repurchased 40.4 million shares for $1.2 billion, 43.3 million shares for $1.0 billion and 225.6 million shares for
$4.0 billion in fiscal 2011, 2010 and 2009, respectively. Our stock repurchase authorization does not have an expiration date and the pace of our repurchase
activity will depend on factors such
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Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research℠