AMD 2004 Annual Report Download - page 97

Table of Contents
The redemption prices for the specified periods are as follows:
Period
Price as a
Percentage of
Principal Amount
Beginning on February 5, 2005 through February 4, 2006 102.375%
Beginning on February 5, 2006 through February 4, 2007 101.583%
Beginning on February 5, 2007 through February 4, 2008 100.792%
Beginning on February 5, 2008 100.000%
The Company may elect to purchase or otherwise retire its 4.75% Debentures with cash, stock or other assets from time to time in open market or privately
negotiated transactions, either directly or through intermediaries, or by tender offer when the Company believes that market conditions are favorable to do so.
Such purchases may have a material effect on the Company’s liquidity, financial condition and results of operations.
4.50% Convertible Senior Notes Due 2007
On November 25, 2002, the Company issued $402.5 million of 4.50% Convertible Senior Notes due 2007 (the 4.50% Notes) in a registered offering.
Interest on the 4.50% Notes is payable semiannually in arrears on June 1 and December 1 of each year, beginning June 1, 2003. Beginning on December 4, 2005,
the 4.50% Notes are redeemable by the Company at the Company’s option for cash at specified prices expressed as a percentage of the outstanding principal
amount plus accrued and unpaid interest provided that the Company may not redeem the 4.50% Notes unless the last reported sale price of its common stock is at
least 150 percent of the then-effective conversion price for at least 20 trading days within a period of 30 trading days ending within five trading days of the date
of the redemption notice.
The redemption prices for the specified periods are as follows:
Period
Price as a
Percentage of
Principal Amount
Beginning on December 4, 2005 through November 30, 2006 101.800%
Beginning on December 1, 2006 through November 30, 2007 100.900%
On December 1, 2007 100.000%
The 4.50% Notes are convertible at the option of the holder at any time prior to the close of business on the business day immediately preceding the
maturity date of December 1, 2007, unless previously redeemed or repurchased, into shares of common stock at a conversion price of $7.37 per share, subject to
adjustment in certain circumstances. At this conversion price, each $1,000 principal amount of the 4.50% Notes will be convertible into approximately 135
shares of its common stock. Issuance costs incurred in the amount of approximately $12 million are amortized ratably, over the term of the 4.50% Notes, as
interest expense, approximating the effective interest method.
Holders have the right to require the Company to repurchase all or a portion of its 4.50% Notes in the event that the Company undergoes specified
fundamental changes, including a change of control. In each such case, the redemption or repurchase price would be 100 percent of the principal amount of the
4.50% Notes plus accrued and unpaid interest.
On October 22, 2004, the Company exchanged $70 million of its 4.50% Notes plus accrued and unpaid interest, for 10,550,000 shares of the Company’s
common stock. On November 8, 2004, the Company exchanged $60 million of its 4.50% Notes for 8,748,612 shares of the Company’s common stock. On
November 18, 2004, the Company exchanged $71 million of its 4.50% Notes for 10,092,649 shares of the Company’s common stock. As a result of these
transactions, the Company recognized a charge of approximately $32 million, which represented the difference between the fair value of the shares issued in the
transactions and the fair value of shares issuable pursuant to the original conversion terms of the 4.50% Notes (see Note 8).
92
Source: ADVANCED MICRO DEVIC, 10-K, March 01, 2005