Pepsi 2011 Annual Report Download - page 74

Note 9
Debt Obligations and Commitments
2011 2010
Short- term debt obligations
Current maturities of long- term debt $ 2,549 $ 1,626
Commercial paper (0.1% and 0.2%) 2,973 2,632
Other borrowings (7.6% and 5.3%) 683 640
$ 6,205 $ 4,898
Long- term debt obligations
Notes due 2011 (4.4%) $ – $ 1,513
Notes due 2012 (3.0% and 3.1%) 2,353 2,437
Notes due 2013 (2.3% and 3.0%) 2,841 2,110
Notes due 2014 (4.6% and 5.3%) 3,335 2,888
Notes due 2015 (2.3% and 2.6%) 1,632 1,617
Notes due 2016 (3.9% and 5.5%) 1,876 875
Notes due 2017–2040 (4.8% and 4.9%) 10,806 9,953
Other, due 2012–2020 (9.9% and 9.8%) 274 232
23,117 21,625
Less: current maturities of long- term debt obligations (2,549) (1,626)
Total $ 20,568 $ 19,999
The interest rates in the above table reect weighted- average rates at year- end.
In the second quarter of 2011, we issued:
t ̓NJMMJPOPGøPBUJOHSBUFOPUFTNBUVSJOHJOXIJDICFBS
interest at a rate equal to the three- month London Inter- Bank
Oered Rate (LIBOR) plus 8 basis points; and
t ̓CJMMJPOPGTFOJPSOPUFTNBUVSJOHJO
In the third quarter of 2011, we issued:
t ̓NJMMJPOPGTFOJPSOPUFTNBUVSJOHJOBOE
t ̓NJMMJPOPGTFOJPSOPUFTNBUVSJOHJO
The net proceeds from the issuances of all the above notes were
used for general corporate purposes.
In the third quarter of 2011, we entered into a new four- year unse-
cured revolving credit agreement (Four- Year Credit Agreement)
which expires in June 2015. Eective August8, 2011, commitments
under this agreement were increased to enable us to borrow up to
$2.925billion, subject to customary terms and conditions. We may
request that commitments under this agreement be increased up to
$3.5billion. Additionally, we may, once a year, request renewal of the
agreement for an additional one- year period.
Also, in the third quarter of 2011, we entered into a new 364-day
unsecured revolving credit agreement (364-Day Credit Agreement)
which expires in June 2012. Eective August8, 2011, commitments
under this agreement were increased to enable us to borrow up to
$2.925billion, subject to customary terms and conditions. We may
request that commitments under this agreement be increased up to
$3.5billion. We may request renewal of this facility for an additional
364-day period or convert any amounts outstanding into a term
loan for a period of up to one year, which would mature no later
than June 2013.
The Four- Year Credit Agreement and the 364-Day Credit
Agreement, together replaced our $2billion unsecured revolving
credit agreement, our $2.575billion 364-day unsecured revolv-
ingcredit agreement and our $1.080billion amended PBG credit
facility. Funds borrowed under the Four- Year Credit Agreement and
the 364-Day Credit Agreement may be used for general corporate
purposes, including but not limited to repayment of outstanding
commercial paper issued by us and our subsidiaries, working capital,
capital investments and/or acquisitions.
In the third quarter of 2011, we paid $784million in a cash tender
oer to repurchase $766million (aggregate principal amount) of
certain WBD debt obligations. As a result of this debt repurchase,
we recorded a $16million charge to interest expense (included in
merger and integration charges) in the third quarter, primarily repre-
senting the premium paid in the tender oer.
In addition, as of December31, 2011, $848million of our debt
related to borrowings from various lines of credit that are primarily
maintained for our international divisions. These lines of credit are
subject to normal banking terms and conditions and are fully com-
mitted at least to the extent of our borrowings.
Long- Term Contractual Commitments(a)
Payments Due by Period
Total 2012 2013–2014 2015–2016
2017 and
beyond
Long- term debt obligations(b) $ 19,738 $ – $ 6,084 $ 3,451 $ 10,203
Interest on debt obligations(c) 7,445 852 1,394 1,091 4,108
Operating leases 1,825 423 598 337 467
Purchasing commitments 2,434 1,113 957 302 62
Marketing commitments 2,519 240 589 535 1,155
$ 33,961 $ 2,628 $ 9,622 $ 5,716 $ 15,995
(a) Reects non- cancelable commitments as of December31, 2011 based on year- end foreign exchange rates and excludes any reserves for uncertain tax positions as we are unable to
reasonably predict the ultimate amount or timing of settlement.
(b) Excludes $2,549million related to current maturities of long- term debt, $470million related to the fair value step- up of debt acquired in connection with our acquisitions of PBG and PAS
and $360million related to the increase in carrying value of long- term debt representing the gains on our fair value interest rate swaps.
(c) Interest payments on oating- rate debt are estimated using interest rates eective as of December31, 2011.
PepsiCo, Inc.  Annual Report
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Notes to Consolidated Financial Statements