Seagate 2009 Annual Report Download - page 92

Table of Contents
SEAGATE TECHNOLOGY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
$430 Million Aggregate Principal Amount of 10% Senior Secured Second-Priority Notes due May 2014 (the "10% Notes") . On May 1,
2009, the Company's subsidiary, Seagate Technology International, completed the sale of $430 million aggregate principal amount of the 10%
Notes, in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended. The obligations under the
10% Notes are unconditionally guaranteed by the Company and certain of its significant subsidiaries. In addition, the obligations under the 10%
Notes are secured by a second
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priority lien on substantially all of the Company's tangible and intangible assets. The indenture governing the 10%
Notes contains covenants that limit the Company's ability, and the ability of certain of its subsidiaries, (subject to certain exceptions) to: incur
additional debt or issue certain preferred shares, create liens, pay dividends, redeem or repurchase debt or shares, and enter into certain
transactions with the Company's shareholders or affiliates.
$600 Million Aggregate Principal Amount of 6.8% Senior Notes due October 2016 (the "2016 Notes") . The 2016 Notes bear interest at
the rate of 6.8% per year, payable semi-annually on April 1 and October 1 of each year. The obligations under the 2016 Notes are
unconditionally guaranteed by certain of the Company's significant subsidiaries. The 2016 Notes are redeemable at the option of the Company in
whole or in part, on not less than 30, nor more than 60 days notice, at a "make-whole" premium redemption price. The "make-whole"
redemption price will be equal to the greater of (1) 100% of the principal amount of the notes being redeemed, or (2) the sum of the present
values of the remaining scheduled payments of principal and interest on the 2016 Notes being redeemed, discounted at the redemption date on a
semi-annual basis at a rate equal to the sum of the applicable Treasury rate plus 50 basis points.
$600 Million Aggregate Principal Amount of 6.875% Senior Notes due May 2020 (the "2020 Notes") . On May 13, 2010, the Company's
subsidiary, Seagate HDD Cayman, completed the sale of $600 million aggregate principal amount of the 2020 Notes, in a private placement
exempt from the registration requirements of the Securities Act of 1933, as amended. The obligations under the 2020 Notes are fully and
unconditionally guaranteed, on a senior unsecured basis, by the Company. The net proceeds from the offering of the 2020 Notes were
approximately $587 million, which will be used to repay, redeem and/or repurchase a portion of the Company's outstanding indebtedness and for
general corporate purposes. The 2020 Notes bear interest at the rate of 6.875% per year, payable semi-annually on May 1 and November 1 of
each year. The 2020 Notes are redeemable any time after May 1, 2015 at the option of the Company in whole or in part, on not less than 30, nor
more than 60 days notice, at a "make-whole" premium redemption price. The "make-whole" redemption price will be equal to the greater of
(1) 100% of the principal amount of the notes being redeemed, or (2) the sum of the present values of the remaining scheduled payments of
principal and interest on the 2020 Notes being redeemed, discounted at the redemption date on a semi-annual basis at a rate equal to the sum of
the applicable Treasury rate plus 50 basis points.
$55 Million Aggregate Principal Amount of 5.75% Subordinated Debentures due March 2012 (the "5.75% Debentures"). The 5.75%
Debentures require semi-annual interest payments on March 1 and September 1 and annual sinking fund payments of $5 million or repurchases
of $5 million in principal amount of debentures in lieu of sinking fund payments. On June 25, 2010, the Company gave notice to the holders of
its 5.75% Debentures that it will call for redemption the entire $33 million outstanding aggregate principal amount of the 5.75% Debentures. As
a result, the 5.75% Debentures are classified as Current portion of long-term debt on the Company's Consolidated Balance Sheet at July 2, 2010.
Subsequently, the 5.75% Debentures were redeemed for cash on July 27, 2010 at 100% of their principal amount, plus accrued and unpaid
interest to the redemption date.
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