AMD » Topics » 8.125% Senior Notes Due 2017

These excerpts taken from the AMD 10-K filed Feb 19, 2010.

8.125% Senior Notes Due 2017

On November 30, 2009, we issued $500 million of 8.125% Senior Notes due 2017 (the 8.125% Notes) at a discount of 10.204%. The 8.125% Notes are our general unsecured senior obligations. Interest is payable on June 15 and December 15 of each year beginning June 15, 2010 until the maturity date of December 15, 2017. The discount of $51 million is recorded as contra debt and will be amortized to interest expense over the life of the loan using the effective interest method.

From December 15, 2013, we may redeem the 8.125% Notes for cash at the following specified prices plus accrued and unpaid interest:

 

Period    Price as
Percentage of
Principal Amount

Beginning on December 15, 2013 through December 14, 2014

   104.063 percent

Beginning on December 15, 2014 through December 14, 2015

   102.031 percent

On December 15, 2015 and thereafter

   100.000 percent

Holders have the right to require us to repurchase all or a portion of our 8.125% Notes in the event that we undergo a change of control, as defined in the indenture governing the 8.125% Notes (the 8.125% Indenture) at a repurchase price of 101 percent of the principal amount plus accrued and unpaid interest. Additionally, an event of default (as defined in the 8.125% Indenture) may result in the acceleration of the maturity of the 8.125% Notes.

The 8.125% Indenture contains certain covenants that limit, among other things, our ability and the ability of our subsidiaries, from:

 

   

incurring additional indebtedness, except specified permitted debt;

 

   

paying dividends and making other restricted payments;

 

   

making certain investments if an event of a default exists, or if specified financial conditions are not satisfied;

 

   

creating or permitting certain liens;

 

   

creating or permitting restrictions on the ability of our subsidiaries to pay dividends or make other distributions to us;

 

   

using the proceeds from sales of assets;

 

   

entering into certain types of transactions with affiliates; and

 

   

consolidating, merging or selling our assets as an entirety or substantially as an entirety.

We may elect to purchase or otherwise retire the 8.125% Notes with cash, stock or other assets from time to time in open market or private negotiated transactions, either directly or through intermediaries, or by tender offer, when we believe the market conditions are favorable to do so.

The agreements governing our 5.75% Notes, 6.00% Notes and 8.125% Notes contain cross-default provisions whereby a default under one agreement would likely result in cross defaults under agreements

 

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covering other borrowings. The occurrence of a default under any of these borrowing arrangements would permit the applicable note holders to declare all amounts outstanding under those borrowing arrangements to be immediately due and payable.

8.125% Senior Notes Due 2017

On November 30, 2009, the Company issued $500 million of 8.125% Senior Notes due 2017 (the 8.125% Notes) at a discount of 10.204%. The 8.125% Notes are general unsecured senior obligations of the Company. Interest is payable on June 15 and December 15 of each year beginning June 15, 2010, until the maturity date of December 15, 2017. The discount of $51 million is recorded as a contra debt and will be amortized, using the effective interest method, to interest expense over the life of the loan.

Prior to December 15, 2013, the Company may redeem some or all of the 8.125% Notes at a price equal to 100% of the principal amount, plus accrued and unpaid interest and a “make-whole” premium. Thereafter, the Company may redeem all or part of the 8.125% Notes at any time at specified redemption prices, plus accrued

 

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and unpaid interest. In addition, prior to December 15, 2012, the Company may redeem up to 35% of the 8.125% Notes from the proceeds of certain equity offerings at pre-defined redemption prices.

Holders have the right to require the Company to repurchase all or a portion of the Company’s 8.125% Notes in the event that the Company undergoes a change of control, as defined in the indenture governing the 8.125% Notes, at a repurchase price of 101 percent of the principal amount plus accrued and unpaid interest.

The 8.125% Indenture contains certain covenants that limit, among other things, the Company’s ability and the ability of its subsidiaries from:

 

   

incurring additional indebtedness, except specified permitted debt;

 

   

paying dividends and making other restricted payments;

 

   

making certain investments if an event of a default exists, or if specified financial conditions are not satisfied;

 

   

creating or permitting certain liens;

 

   

creating or permitting restrictions on the ability of its subsidiaries to pay dividends or make other distributions to the Company;

 

   

using the proceeds from sales of assets;

 

   

entering into certain types of transactions with affiliates; and

 

   

consolidating, merging or selling our assets as an entirety or substantially as an entirety.

The agreements governing our 5.75% Notes, 6.00% Notes and 8.125% Notes contain cross-default provisions whereby a default under one agreement would likely result in cross defaults under agreements covering other borrowings. The occurrence of a default under any of these borrowing arrangements would permit the applicable note holders to declare all amounts outstanding under those borrowing arrangements to be immediately due and payable.

EXCERPTS ON THIS PAGE:

10-K (2 sections)
Feb 19, 2010
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