Amazon.com 2015 Annual Report Download - page 66

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Note 5—LONG-TERM DEBT
In December 2014 and November 2012, we issued $6.0 billion and $3.0 billion of unsecured senior notes as described in
the table below (collectively, the “Notes”). As of December 31, 2015 and 2014, the unamortized discount on the Notes was $89
million and $96 million. We also have other long-term debt with a carrying amount, including the current portion, of $312
million and $881 million as of December 31, 2015 and 2014. The face value of our total long-term debt obligations is as
follows (in millions):
December 31,
2015 2014
0.65% Notes due on November 27, 2015 $
—
$750
1.20% Notes due on November 29, 2017 (1) 1,000 1,000
2.50% Notes due on November 29, 2022 (1) 1,250 1,250
2.60% Notes due on December 5, 2019 (2) 1,000 1,000
3.30% Notes due on December 5, 2021 (2) 1,000 1,000
3.80% Notes due on December 5, 2024 (2) 1,250 1,250
4.80% Notes due on December 5, 2034 (2) 1,250 1,250
4.95% Notes due on December 5, 2044 (2) 1,500 1,500
Other long-term debt 312 881
Total debt 8,562 9,881
Less current portion of long-term debt (238) (1,520)
Face value of long-term debt $ 8,324 $8,361
_____________________________
(1) Issued in November 2012, effective interest rates of the 2017 and 2022 Notes were 1.38% and 2.66%.
(2) Issued in December 2014, effective interest rates of the 2019, 2021, 2024, 2034, and 2044 Notes were 2.73%, 3.43%,
3.90%, 4.92%, and 5.11%.
Interest on the Notes issued in 2014 is payable semi-annually in arrears in June and December. Interest on the Notes
issued in 2012 is payable semi-annually in arrears in May and November. We may redeem the Notes at any time in whole, or
from time to time, in part at specified redemption prices. We are not subject to any financial covenants under the Notes. The
proceeds from the Notes are used for general corporate purposes. The estimated fair value of the Notes was approximately $8.5
billion and $9.1 billion as of December 31, 2015 and 2014, which is based on quoted prices for our publicly-traded debt as of
those dates.
The other debt, including the current portion, had a weighted-average interest rate of 3.7% and 5.5% as of December 31,
2015 and 2014. We used the net proceeds from the issuance of this debt primarily to fund certain international operations. The
estimated fair value of the other long-term debt, which is based on Level 2 inputs, approximated its carrying value as of
December 31, 2015 and 2014.
As of December 31, 2015, future principal payments for our total debt were as follows (in millions):
Year Ended December 31,
2016 $ 238
2017 1,037
2018 37
2019 1,000
2020
—
Thereafter 6,250
$ 8,562
On September 5, 2014, we entered into an unsecured revolving credit facility (the “Credit Agreement”) with a syndicate
of lenders that provides us with a borrowing capacity of up to $2.0 billion. The Credit Agreement has a term of two years, but it
may be extended for up to three additional one-year terms if approved by the lenders. The initial interest rate applicable to
outstanding balances under the Credit Agreement is the London interbank offered rate (“LIBOR”) plus 0.625%, under our
current credit ratings. If our credit ratings are downgraded this rate could increase to as much as LIBOR plus 1.00%. There
were no borrowings outstanding under the Credit Agreement as of December 31, 2015 and 2014.