XML 74 R20.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2

Debt

3 Months Ended

Nov. 28, 2019

Debt Disclosure [Abstract]

Debt

Debt

			November 28, 2019																														August 29, 2019
									Net Carrying Amount																		Net Carrying Amount
As of			Stated Rate			Effective Rate			Current			Long-Term			Total						Current			Long-Term			Total
Finance lease obligations			N/A			4.84		%	$	185		$	344		$	529					$	223		$	368		$	591
MMJ Creditor Payments			N/A			9.76		%	197			—			197						198			—			198
2024 Notes			4.64		%	4.76		%	—			597			597						—			597			597
2024 Term Loan A			3.05		%	3.10		%	62			1,186			1,248						—			—			—
2026 Notes			4.98		%	5.07		%	—			497			497						—			497			497
2027 Notes			4.19		%	4.27		%	—			895			895						—			895			895
2029 Notes			5.33		%	5.40		%	—			696			696						—			696			696
2030 Notes			4.66		%	4.73		%	—			845			845						—			845			845
2032D Notes (1)			3.13		%	6.33		%	—			128			128						—			127			127
2033F Notes (1)			2.13		%	4.93		%	18			—			18						196			—			196
IMFT Member Debt			N/A			N/A			—			—			—						693			—			693
2025 Notes			5.50		%	5.56		%	—			—			—						—			516			516
									$	462		$	5,188		$	5,650					$	1,310		$	4,541		$	5,851

⁽¹⁾Since the closing price of our common stock exceeded 130% of the conversion price per share for at least 20 trading days in the 30 trading day period ended on September 30, 2019, these notes are convertible by the holders through the calendar quarter ended December 31, 2019. Additionally, the closing price of our common stock also exceeded the thresholds for the calendar quarter ended December 31, 2019; therefore, these notes are convertible by the holders at any time through March 31, 2020.

IMFT Member Debt

In connection with our purchase of Intel's noncontrolling interest in IMFT on October 31, 2019, we extinguished the remaining IMFT Member Debt as a component of the cash consideration paid to Intel for their interest in IMFT and recognized a non-operating gain of $72 million for the difference between the $505 million of cash consideration allocated to the extinguishment of IMFT Member Debt and its $577 million carrying value. (See "Equity – Noncontrolling Interest in Subsidiary" note for the cash consideration allocated to the repurchase of noncontrolling interest.) Prior to our acquisition of Intel's interests in IMFT, IMFT repaid Intel $116 million of IMFT Member Debt in the first quarter of fiscal 2020.

Convertible Senior Notes

As of November 28, 2019, the $48.16 trading price of our common stock was higher than the conversion prices of our convertible notes and, as a result, the aggregate conversion value of $718 million exceeded the aggregate principal amount of $151 million by $567 million.

Credit Facility

Our credit facility provides for a term loan and a committed revolving credit facility. On October 30, 2019, we drew all of the $1.25 billion available under our term loan credit facility. Principal payments are due annually in an amount equal to 5.0% of the initial principal amount with the balance due at maturity in October 2024. The term loan facility generally bears interest at a rate equal to LIBOR plus 1.25% to 2.00%, depending on our corporate credit ratings or leverage ratio. Our revolving credit facility provides for borrowings of up to $2.50 billion at the same rates as the term loan credit facility and matures in July 2023. As of November 28, 2019, there were no outstanding amounts drawn under our revolving credit facility.

Under the terms of the credit facility, we must maintain ratios, calculated as of the last day of each fiscal quarter, of total indebtedness to adjusted EBITDA and adjusted EBITDA to net interest expense.

Debt Activity

The table below presents the effects of issuances, prepayments, and conversions of debt in the first quarter of 2020. When we receive a notice of conversion for any of our convertible notes and elect to settle in cash any amount of the conversion obligation in excess of the principal amount, the cash settlement obligations become derivative debt liabilities subject to mark-to-market accounting treatment based on the volume-weighted-average price of our common stock over a period of 20 consecutive trading days. Accordingly, at the date of our election to settle a conversion in cash, we reclassify the fair value of the equity component of the converted notes from additional capital to derivative debt liability within current debt in our consolidated balance sheet.

Three months ended November 28, 2019			Increase (Decrease) in Principal			Increase (Decrease) in Carrying Value			Increase (Decrease) in Cash			Decrease in Equity			Gain (Loss)
Issuances
2024 Term Loan A			$	1,250		$	1,248		$	1,248		$	—		$	—
Prepayments
2025 Notes			(519)			(516)			(534)			—			(18)
IMFT Member Debt			(693)			(693)			(621)			—			72
Settled conversions
2033F Notes			(45)			(180)			(196)			(5)			(12)
Conversions not settled
2033F Notes			—			1			—			(1)			—
			$	(7)		$	(140)		$	(103)		$	(6)		$	42

X

- Definition

The entire disclosure for debt and capital lease obligations can be reported. Information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. Also includes descriptions and amounts of capital leasing arrangements that consist of direct financing, sales type and leveraged leases. Disclosure may include the effect on the balance sheet and the income statement resulting from a change in lease classification for leases that at inception would have been classified differently had guidance been in effect at the inception of the original lease.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 840
-URI http://asc.fasb.org/topic&trid=2208923

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

+ Details

Name:	us-gaap_DebtAndCapitalLeasesDisclosuresTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- References

No definition available.

+ Details

Name:	us-gaap_DebtDisclosureAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration