Coca Cola 2010 Annual Report Download - page 123

Subsequent to the repurchase of a portion of the long-term debt assumed from CCE, the general terms of the debt
assumed and remaining outstanding as of December 31, 2010, are as follows:
• $2,594 million total principal amount of U.S. dollar notes due 2011 to 2037 at an average interest rate of
5.7 percent;
• $2,288 million total principal amount of U.S. dollar debentures due 2012 to 2098 at an average interest rate of
7.4 percent;
• $275 million total principal amount of U.S. dollar notes due 2011 at a variable interest rate of 1.0 percent;
• $544 million total principal amount of U.K. pound sterling notes due 2016 and 2021 at an average interest rate
of 6.5 percent;
• $303 million principal amount of U.S. dollar zero coupon notes due 2020; and
• $26 million of other long-term debt.
On March 6, 2009, the Company issued $2,250 million of long-term notes and used the proceeds to replace a certain
amount of commercial paper and short-term debt with longer-term debt. The general terms of these notes are as
follows:
• $900 million total principal amount of notes due March 15, 2014, at a fixed interest rate of 3.625 percent; and
• $1,350 million total principal amount of notes due March 15, 2019, at a fixed interest rate of 4.875 percent.
The Company’s long-term debt consisted of the following (in millions, except average rate data):
December 31, 2010 December 31, 2009
Average Average
Amount Rate1Amount Rate1
U.S. dollar notes due 2011–2093 $ 11,195 2.7% $ 4,600 5.0%
U.S. dollar debentures due 2012–2098 2,946 7.4 ——
U.S. dollar zero coupon notes due 20202222 8.4 ——
U.K. pound sterling notes due 2016 and 2021 652 6.5 ——
Other, due through 2018 404 5.0 510 5.3
Fair value adjustment3(102) N/A — N/A
Total4,5 $ 15,317 3.6% $ 5,110 5.0%
Less current portion 1,276 51
Long-term debt $ 14,041 $ 5,059
1These rates represent the weighted-average effective interest rate on the balances outstanding as of year end, as adjusted for the
effects of interest rate swap agreements as well as fair value adjustments, if applicable. Refer to Note 5 for a more detailed
discussion on interest rate management.
2This amount is shown net of unamortized discounts of $81 million as of December 31, 2010.
3Refer to Note 5 for additional information about our fair value hedging strategy.
4As of December 31, 2010 and 2009, the fair value of our long-term debt, including the current portion, was approximately
$16,218 million and $5,371 million, respectively. The fair value of our long-term debt is estimated based on quoted prices for those
or similar instruments.
5The above notes include various restrictions, none of which is presently significant to our Company.
As of December 31, 2010, the carrying value of the Company’s long-term debt included approximately $994 million of
fair value adjustments related to the debt assumed from CCE. These fair value adjustments will be amortized over a
weighted-average period of approximately 15 years, which is equal to the weighted-average maturity of the assumed
debt to which these fair value adjustments relate. The amortization of these fair value adjustments will be a reduction
of interest expense in future periods, which will typically result in our interest expense being less than the actual interest
paid to service the debt. Total interest paid was $422 million, $346 million and $460 million in 2010, 2009 and 2008,
respectively.
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