Intel 1997 Annual Report Download - page 48

Notes to consolidated
financial statements
The amount related to Intel's potential repurchase obligation has been reclassified from stockholders' equity to put warrants. The 26.3 million
put warrants outstanding at December 27, 1997 expire on various dates between February and August 1998 and have exercise prices ranging
from $68 to $95 per share, with an average exercise price of $78 per share. There is no significant effect on diluted earnings per share for the
periods presented.
Borrowings
Short-term debt. Short-term debt and weighted average interest rates at fiscal year-ends were as follows:
The Company also borrows under commercial paper programs. Maximum borrowings under commercial paper programs reached $175 million
during 1997 and $306 million during 1996. This debt is rated A-1+ by Standard and Poor's and P-1 by Moody's. Proceeds are used to fund
short-term working capital needs.
Long-term debt. Long-term debt at fiscal year-ends was as follows:
The Company has guaranteed repayment of principal and interest on the AFICA Bonds issued by the Puerto Rico Industrial, Medical and
Environmental Pollution Control Facilities Financing Authority ("AFICA"). The bonds are adjustable and redeemable at the option of either the
Company or the bondholder every five years through 2013. They are next adjustable and redeemable in 1998 and accordingly have been
reclassified as a current liability at December 27, 1997. The Irish punt borrowings were made in connection with the financing of a factory in
Ireland, and Intel has invested the proceeds in Irish punt denominated instruments of similar maturity to hedge foreign currency and interest
rate exposures. The Greek drachma borrowings were made under a tax incentive program in Ireland, and the proceeds and cash flows have
been swapped to U.S. dollars. The $300 million reverse repurchase arrangement originally payable in 2001 was repaid in 1997. It had a
borrowing rate of 5.9% at December 28, 1996.
Under shelf registration statements filed with the Securities and Exchange Commission, Intel originally had the authority to issue up to $3.3
billion in the aggregate of Common Stock, Preferred Stock, depositary shares, debt securities and warrants to purchase the Company's or other
issuers' Common Stock, Preferred Stock and debt securities, and, subject to certain limits, stock index warrants and foreign currency exchange
units. In 1993, Intel completed an offering of Step-Up Warrants (see "1998 Step-Up Warrants") under these registration statements. The
Company may issue up to approximately $1.4 billion in additional securities under effective registration statements.
As of December 27, 1997, aggregate debt maturities were as follows: 1998
-
$110 million; 1999
-
$7 million; 2000
-
$5 million; 2001
-
$56 million;
1997 1996
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Weighted Weighted
average average
interest interest
(In millions) Balance rate Balance rate
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Borrowed under
lines of credit $ 32 N/A $ 30 N/A
Reverse repurchase
agreements payable in
non-U.S. currencies -- -- 263 6.4%
Notes payable -- -- 3 0.7%
Drafts payable 180 N/A 93 N/A
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Total $ 212 $ 389
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(In millions) 1997 1996
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Payable in U.S. dollars:
AFICA Bonds due 2013 at 4% $ 110 $ 110
Reverse repurchase arrangement due 2001 -- 300
Other U.S. dollar debt 6 4
Payable in other currencies:
Irish punt due 1999-2027 at 5%-12% 396 268
Greek drachma due 2001 46 46
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Subtotal 558 728
Less long-term debt
redeemable within one year (110) --
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Total $ 448 $ 728
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