Debt and Credit Facility

2017 Convertible Notes

As of March 28, 2015, the Company had $600.0 million principal amount of 2017 Convertible Notes outstanding. The 2017 Convertible Notes are senior in right of payment to the Company’s existing and future unsecured indebtedness that is expressly subordinated in right of payment to the 2017 Convertible Notes, and are ranked equally with all of our other existing and future unsecured senior indebtedness, including the 2019 and 2021 Notes discussed below. The Company may not redeem the 2017 Convertible Notes prior to maturity.

The 2017 Convertible Notes are convertible, subject to certain conditions, into shares of Xilinx common stock at a conversion rate of 33.7391 shares of common stock per $1 thousand principal amount of the 2017 Convertible Notes, representing an effective conversion price of approximately $29.64 per share of common stock. The conversion rate is subject to adjustment for certain events as outlined in the indenture governing the 2017 Convertible Notes but will not be adjusted for accrued interest. One of the conditions allowing holders of the 2017 Convertible Notes to convert during any fiscal quarter is if the last reported sale price of the Company's common stock for at least 20 trading days during a period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day. This condition was met as of March 28, 2015 and as a result, the 2017 Convertible Notes were convertible at the option of the holders. As of March 28, 2015, the 2017 Convertible Notes were classified as a current liability on the Company's consolidated balance sheet. Additionally, a portion of the equity component attributable to the conversion feature of the 2017 Convertible Notes was classified in temporary stockholders' equity. The amount classified as temporary equity was equal to the difference between the principal amount and carrying value of the 2017 Convertible Notes.

Upon conversion, the Company would pay the holders of the 2017 Convertible Notes cash up to the aggregate principal amount of the 2017 Convertible Notes. If the conversion value exceeds the principal amount, the Company would deliver shares of its common stock with respect to the remainder of its conversion obligation in excess of the aggregate principal amount (conversion spread). Accordingly, there would be no adjustment to the numerator in the net income per common share computation for the cash settled portion of the 2017 Convertible Notes, as that portion of the debt liability will always be settled in cash. The conversion spread will be included in the denominator for the computation of diluted net income per common share, using the treasury stock method.

The carrying values of the liability and equity components of the 2017 Convertible Notes are reflected in the Company’s consolidated balance sheets as follows:



(In thousands)	2015			2014
Liability component:
Principal amount of the 2017 Convertible Notes	$	600,000		$	600,000
Unamortized discount of liability component	(33,679		)	(49,223		)
Hedge accounting adjustment – sale of interest rate swap	9,732			14,224
Net carrying value of the 2017 Convertible Notes	$	576,053		$	565,001

Equity component (including temporary equity) – net carrying value	$	66,415		$	66,415

The remaining unamortized debt discount, net of the hedge accounting adjustment from the sale of the interest rate swap, is being amortized as additional non-cash interest expense over the expected remaining term of the 2017 Convertible Notes. As of March 28, 2015, the remaining term of the 2017 Convertible Notes is 2.2 years. As of March 28, 2015, the if-converted value of the 2017 Convertible Notes was $831.6 million.

Interest expense related to the 2017 Convertible Notes was included in interest and other expense, net on the consolidated statements of income as follows:



(In thousands)	March 28, 2015		March 29, 2014		March 30, 2013
Contractual coupon interest	$	15,750	$	15,750	$	15,750
Amortization of debt issuance costs	1,448		1,448		1,448
Amortization of debt discount, net	11,052		11,052		11,052
Total interest expense related to the 2017 Convertible Notes	$	28,250	$	28,250	$	28,250

To hedge against potential dilution upon conversion of the 2017 Convertible Notes, the Company also purchased call options on its common stock from the hedge counterparties. The call options give the Company the right to purchase up to 20.2 million shares of its common stock at $29.64 per share. The call options will terminate upon the earlier of the maturity of the 2017 Convertible Notes or the last day any of the 2017 Convertible Notes remain outstanding. To reduce the hedging cost, under separate transactions the Company sold warrants to the hedge counterparties, which give the hedge counterparties the right to purchase up to 20.2 million shares of the Company’s common stock at $41.99 per share. These warrants expire on a gradual basis over a specified period starting on September 13, 2017.

2019 and 2021 Notes

On March 12, 2014, the Company issued $500.0 million principal amount of 2019 Notes and $500.0 million principal amount of 2021 Notes with maturity dates of March 15, 2019 and March 15, 2021 respectively. The 2019 and 2021 Notes were offered to the public at a discounted price of 99.477% and 99.281% of par, respectively. Interest on the 2019 and 2021 Notes is payable semiannually on March 15 and September 15.

The Company received net proceeds of $990.1 million from issuance of the 2019 and 2021 Notes, after the debt discounts and deduction of debt issuance costs. The debt discounts and issuance costs are amortized to interest expense over the lives of the 2019 and 2021 Notes.

The following table summarizes the carrying value of the 2019 and 2021 Notes in the Company's consolidated balance sheets:



(In thousands)	2015			2014
Principal amount of the 2019 Notes	$	500,000		$	500,000
Unamortized discount of the 2019 Notes	(2,073		)	(2,574		)
Principal amount of the 2021 Notes	500,000			500,000
Unamortized discount of the 2021 Notes	(3,088		)	(3,556		)
Total senior notes	$	994,839		$	993,870

Interest expense related to the 2019 and 2021 Notes was included in interest and other expense, net on the consolidated statements of income as follows:



(In thousands)	March 28, 2015		March 29, 2014		March 30, 2013
Contractual coupon interest	$	25,625	$	1,210	$	—
Amortization of debt issuance costs	586		52		—
Amortization of debt discount, net	970		80		—
Total interest expense related to the 2019 and 2021 Notes	$	27,181	$	1,342	$	—

2037 Convertible Notes

On March 12, 2014, the Company paid $1.23 billion in cash to redeem all of the outstanding $689.6 million (principal amount) of its 2037 Convertible Notes. In accordance with the authoritative guidance for convertible debentures issued by the FASB, the redemption payment was allocated between the liability ($377.6 million) and equity ($856.5 million) components of the convertible debentures, using the equivalent rate that reflected the borrowing rate for a similar non-convertible debt prior to the redemption. As a result, the Company recognized a loss on extinguishment of convertible debentures of $9.8 million, net of the unamortized debt discount ($315.4 million), the write-off of the unamortized debt issuance costs ($5.1 million) and unamortized embedded derivative valuation ($1.3 million).

Prior to the redemption, interest expense related to the 2037 Convertible Notes was included in interest and other expense, net on the consolidated statements of income, and was recognized as follows:



(In thousands)	March 28, 2015		March 29, 2014			March 30, 2013
Contractual coupon interest	$	—	$	20,065		$	21,551
Amortization of debt issuance costs	—		223			223
Amortization of embedded derivative	—		58			58
Amortization of debt discount	—		5,187			4,828
Fair value adjustment of embedded derivative	—		(1,090		)	159
Total interest expense related to the 2037 Convertible Notes	$	—	$	24,443		$	26,819

Revolving Credit Facility

On December 7, 2011, the Company entered into a $250.0 million senior unsecured revolving credit facility with a syndicate of banks (expiring in December 2016). Borrowings under the credit facility will bear interest at a benchmark rate plus an applicable margin based upon the Company’s credit rating. In connection with the credit facility, the Company is required to maintain certain financial and non-financial covenants. As of March 28, 2015, the Company had made no borrowings under this credit facility and was not in violation of any of the covenants.