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ADOBE SYSTEMS INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
103
Credit Agreement
On March 2, 2012, we entered into a five-year $1.0 billion senior unsecured revolving credit agreement (the “Credit
Agreement”), providing for loans to us and certain of our subsidiaries. Pursuant to the terms of the Credit Agreement, we may,
subject to the agreement of the applicable lenders, request up to an additional $500.0 million in commitments, for a maximum
aggregate commitment of $1.5 billion. Loans under the Credit Agreement will bear interest at either (i) LIBOR plus a margin,
based on our debt ratings, ranging from 0.795% and 1.30% or (ii) the base rate, which is defined as the highest of (a) the agent’s
prime rate, (b) the federal funds effective rate plus 0.50% or (c) LIBOR plus 1.00% plus a margin, based on our debt ratings,
ranging from 0.00% to 0.30%. Commitment fees are payable quarterly at rates between 0.08% and 0.20% per year also based on
our public debt ratings. Subject to certain conditions stated in the Credit Agreement, we and any of our subsidiaries designated as
additional borrowers may borrow, prepay and re-borrow amounts under the revolving credit facility at any time during the term
of the Credit Agreement.
The Credit Agreement contains customary representations, warranties, affirmative and negative covenants, including a
financial covenant, events of default and indemnification provisions in favor of the lenders. The negative covenants include
restrictions regarding the incurrence of liens and indebtedness, certain merger and acquisition transactions, dispositions and other
matters, all subject to certain exceptions. The financial covenant, based on a quarterly financial test, requires us not to exceed a
maximum leverage ratio.
On March 1, 2013, we exercised an option under the Credit Agreement to extend the maturity date of the Credit Agreement
by one year to March 2, 2018. The facility will terminate and all amounts owing thereunder will be due and payable on the maturity
date unless (a) the commitments are terminated earlier upon the occurrence of certain events, including an event of default, or (b)
the maturity date is further extended upon our request, subject to the agreement of the lenders.
As of November 28, 2014, there were no outstanding borrowings under this Credit Agreement and we were in compliance
with all covenants.
Capital Lease Obligation
In fiscal 2013, we entered into a sale-leaseback agreement totaling $25.7 million over a period of 24 months. This transaction
was classified as a capital lease obligation and was recorded at fair value. As of November 28, 2014, our capital lease obligations
of $3.3 million are presented as current debt in our Consolidated Balance Sheets.