ADP 2014 Annual Report Download - page 60

Other intangibles consist primarily of purchased rights, covenants, patents, and trademarks (acquired directly or through acquisitions). All of the intangible assets
have finite lives and, as such, are subject to amortization. The weighted average remaining useful life of the intangible assets is 5 years ( 4 years for software and
software licenses, 10 years for customer contracts and lists, and 3 years for other intangibles). A mortization of intangible assets was $150.7 million , $142.5
million , and $137.4 million for fiscal 2015 , 2014 , and 2013 , respectively.
Estimated future amortization expenses of the Company's existing intangible assets are as follows:
Amount
Twelve months ending June 30, 2016 $ 142.9
Twelve months ending June 30, 2017 $ 122.6
Twelve months ending June 30, 2018 $ 75.1
Twelve months ending June 30, 2019 $ 45.3
Twelve months ending June 30, 2020 $ 36.0
NOTE 8. SHORT TERM FINANCING
The Company has a $2.75 billion , 364 -day credit agreement with a group of lenders that matures in June 2016 . In addition, the Company has a five -year $3.25
billion credit facility maturing in June 2019 that contains an accordion feature under which the aggregate commitment can be increased by $500.0 million , subject
to the availability of additional commitments. The Company also has a $2.25 billion five -year credit facility that matures in June 2020 that also contains an
accordion feature under which the aggregate commitment can be increased by $500.0 million , subject to the availability of additional commitments. The interest
rate applicable to committed borrowings is tied to LIBOR, the effective federal funds rate, or the prime rate depending on the notification provided by the
Company to the syndicated financial institutions prior to borrowing. The Company is also required to pay facility fees on the credit agreements. The primary uses
of the credit facilities are to provide liquidity to the commercial paper program and funding for general corporate purposes, if necessary. The Company had no
borrowings through June 30, 2015 under the credit agreements.
Our U.S. short-term funding requirements related to client funds are sometimes obtained through a short-term commercial paper program, which provides for the
issuance of commercial paper, rather than liquidating previously-collected client funds that have already been invested in available-for-sale securities. During fiscal
2015 , this commercial paper program provided for the issuance of up to $7.5 billion in aggregate maturity value; in July 2015 , we increased our U.S. short-term
commercial paper program to provide for the issuance of up to $8.25 billion in aggregate maturity value. The Company’s commercial paper program is rated A -1+
by Standard & Poor’s and Prime-1 by Moody’s. These ratings denote the highest quality commercial paper securities. Maturities of commercial paper can range
from overnight to up to 364 days . At J une 30, 2015 , the Company had no commercial paper outstanding. At J une 30, 2014 , the Company had $2.2 billion of
commercial paper outstanding, which was repaid on J uly 1, 2014 . In fiscal 2015 and 2014 , the Company's average daily borrowings were $2.3 billion at a
weighted average interest rate of 0.1% . The weighted average maturity of the Company’s commercial paper in fiscal 2015 and 2014 was approximately two days.
The Company’s U.S. and Canadian short-term funding requirements related to client funds obligations are sometimes obtained on a secured basis through the use
of reverse repurchase agreements, which are collateralized principally by government and government agency securities, rather than liquidating previously-
collected client funds that have already been invested in available-for-sale securities. These agreements generally have terms ranging from overnight to up to five
business days . At J une 30, 2015 and 2014 , there were no outstanding obligations related to the reverse repurchase agreements. In fiscal 2015 and 2014 , the
Company had average outstanding balances under reverse repurchase agreements of $421.2 million and $361.7 million , respectively, at weighted average interest
rates of 0.4% and 0.5% , respectively. In addition, the Company has $3.25 billion available on a committed basis under the U.S. reverse repurchase agreements.
NOTE 9. EMPLOY EE BENEFIT PLANS
A. Stock-based Compensation Plans. Stock-based compensation consists of the following:
•Stock Options. Stock options are granted to employees at exercise prices equal to the fair market value of the Company's common stock on the dates
of grant. Stock options are issued under a graded vesting schedule and have a term of 10 years . Options granted prior to J uly 1, 2008 generally vest
ratably over five years and options granted after July 1, 2008 generally vest ratably over four years . Compensation expense is measured based on the
fair value
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