Debt and Borrowing Arrangements

3 Months Ended

Apr. 03, 2015

DEBT AND BORROWING ARRANGEMENTS

During the three months ended April 3, 2015, the Company issued €8,500 million of long-term debt. The carrying value of this debt as of April 3, 2015 was $9,297 million. The general terms of the notes issued are as follows:


•	€2,000 million total principal amount of notes due March 9, 2017, at a variable interest rate equal to the three-month Euro Interbank Offered Rate ("EURIBOR") plus 0.15 percent;


•	€2,000 million total principal amount of notes due September 9, 2019, at a variable interest rate equal to the three-month EURIBOR plus 0.23 percent;


•	€1,500 million total principal amount of notes due March 9, 2023, at a fixed interest rate of 0.75 percent;


•	€1,500 million total principal amount of notes due March 9, 2027, at a fixed interest rate of 1.125 percent; and


•	€1,500 million total principal amount of notes due March 9, 2035, at a fixed interest rate of 1.625 percent.

During the three months ended April 3, 2015, the Company retired $1,500 million of long-term debt upon maturity. The Company also extinguished $2,039 million of long-term debt prior to maturity, incurring associated charges of $320 million recorded in the line item interest expense in our condensed consolidated statement of income. These charges included the difference between the reacquisition price and the net carrying amount of the debt extinguished, including the impact of the related fair value hedging relationship. The general terms of the notes that were extinguished are as follows:


•	$1,148 million total principal amount of notes due November 15, 2017, at a fixed interest rate of 5.35 percent; and


•	$891 million total principal amount of notes due March 15, 2019, at a fixed interest rate of 4.875 percent.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References+ Details