Washington Post 2004 Annual Report Download - page 64

E. DEBT During 2004 and 2003, the Company had average borrowings
outstanding of approximately $516.0 million and $605.7 million,
Long-term debt consists of the following (in millions): respectively, at average annual interest rates of approximately
January 2, December 28, 4.8% and 4.2%, respectively. The Company incurred net interest
2005 2003 costs on its borrowings of $26.4 million and $26.9 million during
2004 and 2003, respectively. No interest expense was capital-
Commercial paper borrowings ÏÏÏ $ 50.2 $ 188.3
ized in 2004 or 2003.
5.5% unsecured notes due
February 15, 2009 ÏÏÏÏÏÏÏÏÏÏÏ 398.9 398.7 At January 2, 2005 and December 28, 2003, the fair value of the
4.0% notes due 2004Ó Company's 5.5% unsecured notes, based on quoted market
2006 (8.35 million and prices, totaled $423.0 million and $434.6 million, respectively,
16.7 million)ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 16.1 29.7 compared with the carrying amount of $398.9 million and
Other indebtedness ÏÏÏÏÏÏÏÏÏÏÏÏÏ 18.9 14.4
$398.7 million, respectively.
Total ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 484.1 631.1
Less current portion ÏÏÏÏÏÏÏÏÏÏÏÏÏ (58.2) (208.6) The carrying value of the Company's commercial paper borrowings
Total long-term debtÏÏÏÏÏÏÏÏÏÏÏÏÏ $425.9 $ 422.5 and other unsecured debt at January 2, 2005 and December 28,
2003 approximates fair value.
During 2003, notes of 16.7 million were issued to FTC employees
who were former FTC shareholders in connection with the acquisi- F. REDEEMABLE PREFERRED STOCK
tion. The noteholders, at their discretion, had the option of electing
to receive 25% of their outstanding balance in January 2004 and in In connection with the acquisition of a cable television system in
August 2004, 50% of the original outstanding balance (less the 1996, the Company issued 11,947 shares of its Series A Preferred
amount paid in January) was due for payment. Payments of Stock. On February 23, 2000, the Company issued an additional
$6.2 million and $8.8 million were made in January 2004 and 1,275 shares related to this transaction. From 1998 to 2004, 955
August 2004, respectively. The remaining balance outstanding of shares of Series A Preferred Stock were redeemed at the request of
8.35 million is due for payment in August 2006. Series A Preferred Stockholders.
Interest on the 5.5% unsecured notes is payable semi-annually on The Series A Preferred Stock has a par value of $1.00 per share
February 15 and August 15. and a liquidation preference of $1,000 per share; it is redeemable
by the Company at any time on or after October 1, 2015 at a
At January 2, 2005 and December 28, 2003, the average interest redemption price of $1,000 per share. In addition, the holders of
rate on the Company's outstanding commercial paper borrowings such stock have a right to require the Company to purchase their
was 2.2% and 1.1%, respectively. During the third quarter of shares at the redemption price during an annual 60-day election
2004, the Company replaced its expiring $250 million 364-day period; the first such period began on February 23, 2001. Divi-
revolving credit facility with a new $250 million revolving credit dends on the Series A Preferred Stock are payable four times a year
facility on essentially the same terms. The new facility expires in at the annual rate of $80.00 per share and in preference to any
August 2005. In 2002, the Company replaced its revolving credit dividends on the Company's common stock. The Series A Preferred
facility agreements with a new five-year $350 million revolving Stock is not convertible into any other security of the Company, and
credit facility, which expires in August 2007. These revolving credit the holders thereof have no voting rights except with respect to any
facility agreements support the issuance of the Company's short- proposed changes in the preferences and special rights of such
term commercial paper. stock.
Under the terms of the five-year $350 million revolving credit
G. CAPITAL STOCK, STOCK AWARDS AND STOCK
facility, interest on borrowings is at floating rates, and depending
OPTIONS
on the Company's long-term debt rating, the Company is required
to pay an annual fee of 0.07% to 0.15% on the unused portion of Capital Stock. Each share of Class A common stock and Class B
the facility, and 0.25% to 0.75% on the used portion of the facility. common stock participates equally in dividends. The Class B stock
Under the terms of the $250 million 364-day revolving credit has limited voting rights and as a class has the right to elect 30% of
facility, interest on borrowings is at floating rates, and based on the the Board of Directors; the Class A stock has unlimited voting rights,
Company's long-term debt rating, the Company is required to pay including the right to elect a majority of the Board of Directors.
an annual fee of 0.05% to 0.125% on the unused portion of the
During 2004 the Company did not purchase any shares of its
facility, and 0.25% to 0.75% on the used portion of the facility.
Class B common stock. During 2003 and 2002, the Company
Also under the terms of the $250 million 364-day revolving credit
purchased a total of 910 shares and 1,229 shares, respectively,
facility, the Company has the right to extend the term of any
of its Class B common stock at a cost of approximately $0.7 million
borrowings for up to one year from the credit facility's maturity date
and $0.8 million. At January 2, 2005, the Company has authoriza-
for an additional fee of 0.125%. Both revolving credit facilities
tion from the Board of Directors to purchase up to 542,800 shares
contain certain covenants, including a financial covenant that the
of Class B common stock.
Company maintain at least $1 billion of consolidated shareholders'
equity.
48 THE WASHINGTON POST COMPANY