Mattel 2003 Annual Report Download - page 79

Mattel has a $300.0 million domestic receivables sales facility that is a sub-facility of Mattel’s domestic
unsecured committed revolving credit facility. The outstanding amount of receivables sold under the domestic
receivables facility may not exceed $300.0 million at any given time, and the amount available to be borrowed
under the credit facility is reduced to the extent of any such outstanding receivables sold. Under the domestic
receivables facility, certain trade receivables are sold to a group of banks, which currently include, among others,
Bank of America, N.A., as administrative agent, Citicorp USA, Inc. and Fleet National Bank, as syndication
agents, and Societe Generale and BNP Paribas, as documentation agents. After the amendment and restatement
of the domestic unsecured committed revolving credit facility, the group of banks is anticipated to include,
among others, Bank of America, N.A., as administrative agent, Citicorp USA, Inc. and Barclays Bank PLC, as
co-syndication agents, and Societe Generale and BNP Paribas, as co-documentation agents. Pursuant to the
domestic receivables facility, Mattel Sales Corp. and Fisher-Price, Inc. (which are wholly-owned subsidiaries of
Mattel) can sell eligible trade receivables from Wal-Mart and Target to Mattel Factoring, a Delaware corporation
and wholly-owned, consolidated subsidiary of Mattel. Mattel Factoring is a special purpose entity whose
activities are limited to purchasing and selling receivables under this facility. Pursuant to the terms of the
domestic receivables facility and simultaneous with each receivables purchase, Mattel Factoring sells those
receivables to the bank group. Mattel records the transaction, reflecting cash proceeds and sale of accounts
receivable on its consolidated balance sheet, at the time of the sale of the receivables to the bank group.
Mattel’s subsidiaries, Mattel International Holdings B.V., a Netherlands company, Mattel France S.A.S., a
French company, and Mattel GmbH, a German company, have entered into a Euro 150 million European trade
receivables facility, pursuant to which Mattel France S.A.S. and Mattel GmbH may sell trade receivables to a
bank, Societe Generale Bank Nederland N.V. The receivables sales are accounted for as a sale. As with the
domestic receivables facility, each sale of accounts receivable is recorded on Mattel’s consolidated balance sheet
at the time of such sale. No Mattel subsidiary is used as a special purpose entity in connection with these
transactions. Under the European trade receivables facility, the outstanding amount of receivables sold may not
exceed Euro 60 million from February 1 through July 31 of each year and may not exceed Euro 150 million at all
other times. Pursuant to a letter agreement between Societe Generale Bank Nederland N.V. and Mattel
International Holdings B.V., Mattel France S.A.S. and Mattel GmbH effective June 29, 2003, the commitment
termination date for the European receivables facility was extended to June 25, 2004.
The outstanding amounts of accounts receivable that have been sold under these facilities and other
factoring arrangements, net of collections from customers, and have been excluded from Mattel’s consolidated
balance sheets are summarized as follows (in millions):
As of Year End
2003 2002
Receivables sold pursuant to the: .................................................
Domestic receivables facility ................................................ $279.5 $276.1
European receivables facility ................................................ 94.5 85.2
Other factoring arrangements .................................................... 82.0 76.0
$456.0 $437.3
Long-Term Debt
Mattel’s long-term debt consists of the following (in thousands):
As of Year End
2003 2002
6% senior notes due 2003 .................................................. $ — $150,000
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1
⁄ 8 %senior notes due 2005 ................................................ 150,000 150,000
Medium-term notes ....................................................... 450,000 480,000
10.15% mortgage note due 2005 ............................................. 40,069 40,919
Other .................................................................. 1,335 1,446
641,404 822,365
Less: current portion .................................................. (52,274) (182,295)
Total long-term debt ...................................................... $589,130 $ 640,070
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