Nike 2006 Annual Report Download - page 58

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NIKE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The carrying amounts reflected in the consolidated balance sheet for notes payable approximate fair value
due to the short maturities.
The Company purchases through Sojitz America certain athletic footwear, apparel and equipment it acquires
from non-U.S. suppliers. These purchases are for the Company’s operations outside of the U.S., Europe, Middle
East, Africa and Japan. Accounts payable to Sojitz America are generally due up to 60 days after shipment of
goods from the foreign port. The interest rate on such accounts payable is the 60 day London Interbank Offered
Rate (“LIBOR”) as of the beginning of the month of the invoice date, plus 0.75%.
The Company had no borrowings outstanding under its commercial paper program at May 31, 2006 and
2005.
The Company has a multi-year $750 million revolving credit facility in place with a group of banks under
which no amounts were outstanding as of May 31, 2006 and 2005. The facility matures on November 20, 2008
and can be extended for one additional year on the anniversary date. Based on the Company’s current long-term
senior unsecured debt ratings the interest rate charged on any outstanding borrowings would be the prevailing
LIBOR plus 0.18%. The facility fee is 0.07% of the total commitment. Under this agreement, the Company must
maintain, among other things, certain minimum specified financial ratios with which the Company was in
compliance at May 31, 2006.
Note 7 — Long-Term Debt
Long-term debt includes the following:
May 31,
2006 2005
(In millions)
5.5% Corporate Bond, payable August 15, 2006 ............................. $249.3 $250.6
4.8% Corporate Bond, payable July 9, 2007 ................................. 24.7 25.2
5.375% Corporate Bond, payable July 8, 2009 ............................... 24.6 25.7
5.66% Corporate Bond, payable July 23, 2012 ............................... 24.6 26.4
5.4% Corporate Bond, payable August 7, 2012 .............................. 14.4 15.5
4.7% Corporate Bond, payable October 1, 2013 .............................. 50.0 50.0
5.15% Corporate Bonds, payable October 15, 2015 ........................... 98.2 107.2
4.3% Japanese yen note, payable June 26, 2011 .............................. 93.8 97.2
2.6% Japanese yen note, maturing August 20, 2001 through November 20, 2020 . . . 59.7 66.1
2.0% Japanese yen note, maturing August 20, 2001 through November 20, 2020 . . . 26.6 29.5
Other ............................................................... 0.1 0.1
Total ....................................................... 666.0 693.5
Less current maturities ................................................. 255.3 6.2
$410.7 $687.3
The fair value of long-term debt is estimated using discounted cash flow analyses, based on the Company’s
incremental borrowing rates for similar types of borrowing arrangements. The fair value of the Company’s long-
term debt, including current portion, is approximately $674.0 million at May 31, 2006 and $721.2 million at
May 31, 2005.
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