AMD 2005 Annual Report Download - page 45

Table of Contents
7.75% Senior Notes Due 2012
On October 29, 2004, we issued $600 million of 7.75% Senior Notes due 2012 in a private offering pursuant to Rule 144A and Regulation S under the
Securities Act of 1933, as amended. On April 22, 2005, we exchanged these notes for publicly registered notes which have substantially identical terms as the old
notes except that the publicly registered notes (the 7.75% Notes) are registered under the Securities Act of 1933, and, therefore, do not contain legends restricting
their transfer. The 7.75% Notes mature on November 1, 2012. Interest on the 7.75% Notes is payable semiannually in arrears on May 1 and November 1,
beginning May 1, 2005. Prior to November 1, 2008, we may redeem some or all of the 7.75% Notes at a price equal to 100 percent of the principal amount plus
accrued and unpaid interest plus a “make-whole” premium, as defined in the agreement. Thereafter, we may redeem the 7.75% Notes for cash at the following
specified prices plus accrued and unpaid interest:
Period
Price as
Percentage of
Principal Amount
Beginning on November 1, 2008 through October 31, 2009 103.875%
Beginning on November 1, 2009 through October 31, 2010 101.938%
Beginning on November 1, 2010 through October 31, 2011 100.000%
On November 1, 2011 100.000%
In addition, on or prior to November 1, 2007, we may redeem up to 35 percent of the 7.75% Notes with the proceeds of certain sales of our equity
securities at 107.75 percent of the principal amount thereof plus accrued and unpaid interest.
Holders have the right to require us to repurchase all or a portion of our 7.75% Notes in the event that we undergo a change of control, as defined in the
indenture governing the 7.75% Notes at a repurchase price of 101 percent of the principal amount plus accrued and unpaid interest.
The indenture governing the 7.75% Notes contains certain covenants that limit, among other things, our ability and the ability of our restricted subsidiaries,
which include all of our subsidiaries from:
• incurring additional indebtedness;
• paying dividends and making other restricted payments;
• making certain investments, including investments in our unrestricted subsidiaries;
• creating or permitting certain liens;
• creating or permitting restrictions on the ability of the restricted subsidiaries to pay dividends or make other distributions to us;
• using the proceeds from sales of assets;
• entering into certain types of transactions with affiliates; and
• consolidating, merging or selling our assets as an entirety or substantially as an entirety.
Issuance costs incurred in connection with this transaction in the amount of approximately $13 million will be amortized ratably over the term of the
7.75% Notes as interest expense, approximating the effective interest method. We anticipate that approximately $4 million will be charged to interest income and
other income (expense), net as a result of redemption described below.
On January 27, 2006, we sent a notice of redemption to the holders of the 7.75% Notes, with a redemption date of February 26, 2006, for the redemption
of 35 percent (or $210 million) of the aggregate principal amount of the outstanding 7.75% Notes. On February 27, 2006, the holders of the redeemed 7.75%
Notes received
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Source: ADVANCED MICRO DEVIC, 10-K, February 27, 2006