Siemens 2006 Annual Report Download - page 189

Notes to Consolidated Financial Statements
(in millions of €, except where otherwise stated and per share amounts) 185
In fiscal 2006, Siemens redeemed the outstanding amount of €1.6 billion of the 5% €-bond,
which was due on July 4, 2006.
The Company maintains approximately €2.5 billion of convertible notes through its wholly
owned Dutch subsidiary, Siemens Finance B.V., which are fully and unconditionally guaran-
teed by Siemens AG. The convertible notes have a 1.375% coupon and are convertible into
approximately 44.5 million shares of Siemens AG at a conversion price of €56.1681 per share,
which is subject to change under certain circumstances. The conversion right is contingently
exercisable by the holders upon the occurrence of one of several conditions, including, upon
the Company’s share price having exceeded 110% of the conversion price on at least 20 trading
days in a period of 30 consecutive trading days ending on the last trading day of any calendar
quarter. This condition was met in the first quarter of fiscal 2004. In fiscal 2006 approximately
€3 of convertible notes were exercised and were settled primarily in cash. In the third quarter
of fiscal 2006, the Company irrevocably waived its option to pay a cash amount in lieu of the
delivery of shares upon exercise of the conversion right. The Company may, at any time from
June 18, 2007, redeem the notes outstanding at their principal amount together with interest
accrued thereon, if Siemens’ share price exceeds 130% of the conversion price on any 15 of 30
consecutive trading days before notice of early redemption. Unless previously redeemed, con-
verted or repurchased and cancelled, the notes mature on June 4, 2010.
In connection with the acquisition of Flender in fiscal 2005 (see Note 3), Siemens assumed
a€250, 11% senior note due 2010, of which the Company repurchased approximately €194.
The Company has an option to repurchase the remaining €56 outstanding senior note on and
after August 1, 2007 at contractually defined prices.
In fiscal 2005, the Company redeemed and retired the remainder of the Siemens Nederland
N.V. 1.0% exchangeable notes into shares of Infineon Technologies AG with a notional amount
of €596.
As of September 30, 2006, the aggregate amounts of indebtedness maturing during the
next five years and thereafter are as follows (excluding capital leases which are disclosed
separately):
Other financial indebtedness
Other financial indebtedness includes €512 and €520, as of September 30, 2006 and 2005,
respectively, for the Company’s continuing involvement in certain real estate assets sold or
transferred in which Siemens has retained significant risks and rewards of ownership, includ-
ing circumstances in which Siemens participates directly or indirectly in the change in mar-
ket value of the property. Therefore, these transactions have been accounted for as financing
obligations. These real estate properties are carried on the Company’s Consolidated Balance
Sheets and no sale and profit has been recognized.
Notes to Consolidated Financial Statements
Fiscal year
2007 2,122
2008 1,088
2009 643
2010 2,191
2011 2,582
Thereafter 6,631
15,257