AMD 2007 Annual Report Download - page 122

Table of Contents
NOTE 9: Debt
Long-term Borrowings and Obligations
The Company’s long-term debt and capital lease obligations as of December 29, 2007 and December 31, 2006 consist of:
2007 2006
(In millions)
5.75% Senior Notes due 2012 $ 1,500 $ —
6.00% Senior Notes due 2015 2,200 —
October 2006 Term Loan — 2,216
Fab 36 Term Loan 839 893
Repurchase obligations to Fab 36 partners 94 126
7.75% Senior Notes Due 2012 390 390
Obligations under capital leases 234 160
Other 12 12
5,269 3,797
Less: current portion 238 125
Long-term debt and capital lease obligations, less current portion $ 5,031 $ 3,672
5.75% Convertible Senior Notes due 2012
On August 14, 2007, the Company issued $1.5 billion aggregate principal amount of 5.75% Convertible Senior Notes due 2012 (the 5.75% Notes). The
5.75% Notes bear interest at 5.75% per annum. Interest is payable in arrears on February 15 and August 15 of each year beginning February 15, 2008 until the
maturity date of August 15, 2012. The terms of the 5.75% Notes are governed by an Indenture (the 5.75% Indenture) dated as of August 14, 2007, by and
between the Company and Wells Fargo Bank, National Association, as Trustee.
The 5.75% Notes will be convertible, in whole or in part, at any time prior to the close of business on the business day immediately preceding the maturity
date of the 5.75% Notes, into shares of the Company’s common stock based on an initial conversion rate of 49.6771 shares of common stock per $1,000 principal
amount of the 5.75% Notes, which is equivalent to an initial conversion price of approximately $20.13 per share. This initial conversion price represents a
premium of 50% relative to the last reported sale price of the Company’s common stock on August 8, 2007 (the trading date preceding the date of pricing of the
5.75% Notes) of $13.42 per share. This initial conversion rate will be adjusted for certain anti-dilution events. In addition, the conversion rate will be increased in
the case of corporate events that constitute a fundamental change (as defined in the 5.75% Indenture) of the Company under certain circumstances. Holders of the
5.75% Notes may require the Company to repurchase the notes for cash equal to 100% of the principal amount to be repurchased plus accrued and unpaid interest
upon the occurrence of a fundamental change (as defined in the 5.75% Indenture) or a termination of trading (as defined in the Indenture). Additionally, an event
of default (as defined in the Indenture) may result in the acceleration of the maturity of the 5.75% Notes.
The 5.75% Notes rank equally in right of payment with the Company’s existing and future senior debt and senior in right of payment to all of the
Company’s future subordinated debt. The 5.75% Notes rank junior in right of payment to all of the Company’s existing and future senior secured debt to the
extent of the collateral securing such debt and are structurally subordinated to all existing and future debt and liabilities of the Company’s subsidiaries.
In connection with the issuance and sale of the 5.75% Notes, the Company also entered into a Registration Rights Agreement (the 5.75% Registration
Rights Agreement), dated August 14, 2007, between the Company and Lehman Brothers Inc. (the initial purchaser), pursuant to which the Company has agreed
to file a shelf
117
Source: ADVANCED MICRO DEVIC, 10-K, February 26, 2008