Avnet 2004 Annual Report Download - page 35

receivable securitization program. For a detailed description of the Company's external Ñnancing arrange-
ments outstanding at July 3, 2004, please refer to Note 7 in the notes to the consolidated Ñnancial statements
appearing in Item 15 of this Report.
The table below highlights the Company's capital structure:
CAPITAL STRUCTURE
(Dollars in thousands)
July 3, 2004 June 27, 2003 % Change
Short-term debtÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 160,660 $ 187,656 (14.4)%
Long-term debt ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 1,196,160 1,278,399 (6.4)
1,356,820 1,466,055 (7.5)
Shareholders' equity ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 1,953,426 1,832,522 6.6
Total capitalÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $3,310,246 $3,298,577 0.4
Long-term debt in the above table includes the fair value adjustment of $13.6 million and $36.2 million at
July 3, 2004 and June 27, 2003, respectively, for the hedged 8.00% Notes and 9
3
/ 4 % Notes discussed in
Financing Transactions below.
Financing Transactions
In June 2004, the Company entered into an unsecured, three-year $350.0 million credit facility with a
syndicate of banks led by Banc of America LLC and ABN AMRO Incorporated (the ""Credit Facility''). The
Company may select from various interest rate options, currencies and maturities under the Credit Facility.
There were no borrowings under the Credit Facility as of July 3, 2004.
In March 2004, the Company issued $300.0 million of 2% Convertible Senior Debentures due March 15,
2034 (the ""Debentures''). The Debentures are convertible into Avnet common stock at a rate of
29.5516 shares of common stock per $1,000 principal amount of Debentures. The Debentures are only
convertible under certain circumstances, including if: (i) the closing price of the Company's common stock
reaches $45.68 per share (subject to adjustment in certain circumstances) for a speciÑed period of time;
(ii) the average trading price of the Debentures falls below a certain percentage of the conversion value per
Debenture for a speciÑed period of time; (iii) the Company calls the Debentures for redemption; or
(iv) certain corporate transactions, as deÑned, occur. Upon conversion, the Company has the right to deliver
to the holder cash or a combination of cash and common stock, in lieu of solely common stock. The Company
may redeem some or all of the Debentures for cash any time on or after March 20, 2009 at the Debentures'
full principal amount plus accrued and unpaid interest, if any. Holders of the Debentures may require the
Company to purchase, in cash, all or a portion of the Debentures on March 15, 2009, 2014, 2019, 2024 and
2029, or upon a fundamental change, as deÑned, at the Debentures' full principal amount plus accrued and
unpaid interest, if any.
The proceeds from the issuance of the Debentures, net of underwriting fees, were $292.5 million. The
Company used these proceeds to fund the tender and purchase of $273.4 million of its 7
7
/ 8 % Notes due
February 15, 2005. The Company incurred debt extinguishment costs of $16.4 million pre-tax, $14.2 million
after-tax and $0.12 per share on a diluted basis during Ñscal 2004 related primarily to premiums and other
transaction costs associated with this tender.
In March 2004, the Company also repaid in cash its $100.0 million of 6
7
/ 8 % Notes that matured on
March 15, 2004.
In September 2003, the Company terminated its former $350.0 million multi-year credit facility which
was scheduled to mature on October 25, 2004. There were no outstanding borrowings under this multi-year
credit facility at the end of Ñscal 2003 or at the time of the termination and, because the Company did not
expect to draw on the facility prior to its expiration date, management elected to terminate the facility.
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