Verizon Wireless 2009 Annual Report Download - page 59

Notes to Consolidated Financial Statements continued
Verizon Wireless – Notes Payable and Other
Verizon Wireless Capital LLC, a wholly owned subsidiary of Verizon
Wireless, is a limited liability company formed under the laws of Delaware
on December 7, 2001 as a special purpose finance subsidiary to facilitate
the offering of debt securities of Verizon Wireless by acting as co-issuer.
Other than the financing activities as a co-issuer of Verizon Wireless
indebtedness, Verizon Wireless Capital LLC has no material assets, opera-
tions or revenues. Verizon Wireless is jointly and severally liable with
Verizon Wireless Capital LLC for co-issued notes, as indicated below.
2009
During November 2009, Verizon Wireless and Verizon Wireless Capital LLC
completed an exchange offer to exchange privately placed notes issued
in November 2008, as well as in February and May 2009 for new notes
with similar terms.
In June 2009, Verizon Wireless issued $1.0 billion aggregate principal
amount of floating rate notes due 2011. Commencing on December 27,
2009 and on each quarterly interest payment date thereafter, both the
noteholders and Verizon Wireless have the right to require settlement of
all or a portion of these notes at par. Accordingly, the notes are classified
as current maturities in the consolidated balance sheet. As of December
31, 2009, neither Verizon Wireless nor the noteholders have exercised
their right to require settlement on any portion of these notes.
In May 2009, Verizon Wireless and Verizon Wireless Capital LLC co-issued
$4.0 billion aggregate principal amount of two-year fixed and floating
rate notes in a private placement resulting in cash proceeds of approxi-
mately $4.0 billion, net of discounts and issuance costs. In February 2009,
Verizon Wireless and Verizon Wireless Capital LLC co-issued $4.3 billion
NOTE 9
DEBT
Debt Maturing Within One Year
Debt maturing within one year is as follows:
(dollars in millions)
At December 31, 2009 2008
Long-term debt maturing within one year $ 6,105 $ 3,506
Commercial paper 1,100 1,487
Total debt maturing within one year $ 7,205 $ 4,993
The weighted average interest rate for our commercial paper at December 31, 2009 and December 31, 2008 was 0.7% and 2.9%, respectively.
Capital expenditures (primarily acquisition and construction of network assets) are partially financed pending long-term financing through bank loans
and the issuance of commercial paper payable within 12 months.
On April 15, 2009, we terminated all commitments under our previous $6.0 billion three-year credit facility with a syndicate of lenders that was
scheduled to mature in September 2009 and entered into a new $5.3 billion 364-day credit facility with a group of major financial institutions. As of
December 31, 2009, the unused borrowing capacity under the 364-day credit facility was approximately $5.2 billion. A commitment fee accrues on
the unused portion of the credit facility.
Long-Term Debt
Outstanding long-term debt obligations are as follows:
(dollars in millions)
At December 31, Interest Rates % Maturities 2009 2008
Verizon Wireless – notes payable and other 3.75 – 5.55 2011 – 2014 $ 7,000 $ –
7.38 – 8.89 2011 – 2018 6,118 5,983
Floating 2011 6,246 4,440
Verizon Wireless – Alltel assumed notes 6.50 – 7.88 2012 – 2032 2,334 –
Verizon Communications – notes payable and other 4.35 – 5.50 2010 – 2018 6,196 7,878
5.55 – 6.90 2012 – 2038 10,386 8,741
7.25 – 8.95 2010 – 2039 9,671 8,822
Telephone subsidiaries – debentures 4.63 – 7.00 2010 – 2033 8,797 9,654
7.15 – 7.88 2012 – 2032 1,449 1,449
8.00 – 8.75 2010 – 2031 1,080 1,080
Other subsidiaries – debentures and other 6.84 – 8.75 2018 – 2028 1,700 2,200
Employee stock ownership plan loans – NYNEX debentures 9.55 2010 23 47
Capital lease obligations (average rates of 6.3% and 6.2%, respectively) 397 390
Unamortized discount, net of premium (241) (219)
Total long-term debt, including current maturities 61,156 50,465
Less long-term debt maturing within one year 6,105 3,506
Total long-term debt $ 55,051 $ 46,959
57