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SEAGATE TECHNOLOGY AND ITS PREDECESSOR
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS—(CONTINUED)
16. Condensed Consolidating Financial Information
On May 13, 2002, Seagate Technology HDD Holdings, or HDD, issued $400 million in aggregate principal amount of 8% senior notes
due 2009. HDD is the Company’s wholly-owned direct subsidiary, and the Company has guaranteed HDD’s obligations under the 8% senior
notes, on a joint and several, full and unconditional basis. The following tables present parent guarantor, subsidiary issuer and combined non-
guarantors condensed consolidating balance sheets of the Company and its subsidiaries at June 27, 2003 and June 28, 2002 and the condensed
consolidating results of operations and cash flows for the fiscal years ended June 27, 2003 and June 28, 2002. The information classifies the
Company’s subsidiaries into Seagate Technology-parent company guarantor, HDD-subsidiary issuer, and the combined non-guarantors based
upon the classification of those subsidiaries under the terms of the 8% senior notes. The Company is restricted in its ability to obtain funds
from its subsidiaries by dividend or loan under both the indenture governing the 8% senior notes and the credit agreement governing the senior
secured credit facilities. Under each of these instruments, dividends paid by HDD or its restricted subsidiaries would constitute restricted
payments, and loans between the Company and HDD or its restricted subsidiaries would constitute affiliate transactions.
Consolidating Balance Sheet
June 27, 2003
(in millions)
97
Seagate
Technology
Parent
Company
Guarantor
HDD
Subsidiary
Issuer
Combined
Non-
Guarantors
Eliminations
Seagate
Technology
Consolidated
Cash and cash equivalents
$
45
$
—
$
704
$
—
$
749
Short
-
term investments
—
—
445
—
445
Accounts receivable, net
—
—
611
—
611
Intercompany receivable
—
—
14
(14
)
—
Inventories
—
—
319
—
319
Other current assets
—
—
158
—
158
Total Current Assets
45
—
2,251
(14
)
2,282
Property, equipment and leasehold improvements, net
—
—
1,111
—
1,111
Equity investment in HDD
1,288
—
—
(
1,288
)
—
Equity investments in Non
-
Guarantors
—
1,619
—
(
1,619
)
—
Intercompany loan receivable
—
310
—
(
310
)
—
Other assets
—
12
112
—
124
Total Assets
$
1,333
$
1,941
$
3,474
$
(3,231
)
$
3,517
Accounts payable
$
—
$
—
$
640
$
—
$
640
Affiliate accounts payable
—
—
11
—
11
Intercompany payable
1
—
13
(14
)
—
Accrued employee compensation
—
—
217
—
217
Accrued expenses
8
5
299
—
312
Accrued income taxes
—
—
179
—
179
Current portion of long
-
term debt
—
2
2
—
4
Total Current Liabilities
9
7
1,361
(14
)
1,363
Other liabilities
8
—
85
—
93
Intercompany loan payable
—
—
310
(310
)
—
Long
-
term debt, less current portion
—
646
99
—
745
Total Liabilities
17
653
1,855
(324
)
2,201
Shareholders
’
Equity
1,316
1,288
1,619
(2,907
)
1,316
Total Liabilities and Shareholders
’
Equity
$
1,333
$
1,941
$
3,474
$
(3,231
)
$
3,517