Debt Obligations and Commitments

In the second quarter of 2011, we issued $750 million of floating rate notes maturing in 2013, which bear interest at a rate equal to the three-month London Inter-Bank Offered Rate (LIBOR) plus 8 basis points, and $1.0 billion of 2.50% senior notes maturing in 2016. The net proceeds from the issuance of these notes were used for general corporate purposes.

Subsequent to the end of the second quarter of 2011, we entered into a new four-year unsecured revolving credit agreement (Four-Year Credit Agreement) which enables us to borrow up to $2.875 billion, subject to customary terms and conditions, and expires in June 2015. We may request to increase the commitments under this agreement to up to $3.5 billion. Additionally, we may, once a year, request renewal of the agreement for an additional one-year period.

Also, subsequent to the end of the second quarter of 2011, we entered into a new 364-day unsecured revolving credit agreement (364-Day Credit Agreement) which enables us to borrow up to $2.875 billion, subject to customary terms and conditions, and expires in June 2012. We may request to increase the commitments under this agreement to up to $3.5 billion. We may request renewal of this facility for an additional 364-day period or convert any amounts outstanding into a term loan for a period of up to one year, which would mature no later than June 2013.

The Four-Year Credit Agreement and the 364-Day Credit Agreement, together replaced our $2 billion unsecured revolving credit agreement, our $2.575 billion 364-day unsecured revolving credit agreement and our $1.080 billion amended PBG credit facility. Funds borrowed under the Four-Year Credit Agreement and the 364-Day Credit Agreement may be used for general corporate purposes, including but not limited to repayment of outstanding commercial paper issued by us and our subsidiaries, working capital, capital investments and/or acquisitions.

Subsequent to the end of the second quarter of 2011, we paid $784 million in a cash tender offer to repurchase $766 million (aggregate principal amount) of certain WBD debt obligations. As a result of this debt repurchase, we will record a $16 million charge to interest expense in the third quarter, primarily representing the premium paid in the tender offer.

As of June 11, 2011, we had $2.2 billion of commercial paper outstanding.

Long-Term Contractual Commitments^(a)


Payments Due by Period
	Total		2011		2012 – 2013		2014 – 2015		2016 and beyond

Long-term debt obligations^(b)	$	21,016	$	–	$	5,167	$	4,353	$	11,496
Interest on debt obligations^(c)		7,556		467		1,574		1,125		4,390
Operating leases		1,901		253		678		406		564
Purchasing commitments		3,496		931		2,077		406		82
Marketing commitments		2,555		102		562		543		1,348

	$	36,524	$	1,753	$	10,058	$	6,833	$	17,880

^(a)	Reflects non-cancelable commitments as of June 11, 2011 based on foreign exchange rates in effect on that date and excludes any reserves for uncertain tax positions as we are unable to reasonably predict the ultimate amount or timing of settlement.

^(b)	Excludes $2.4 billion related to current maturities of long-term debt, as well as $591 million related to the fair value step-up of debt acquired in connection with our acquisitions of PBG and PAS.

^(c)	Interest payments on floating-rate debt are estimated using interest rates effective as of June 11, 2011.

Most long-term contractual commitments, except for our long-term debt obligations, are not recorded on our balance sheet. Non-cancelable operating leases primarily represent building leases. Non-cancelable purchasing commitments are primarily for packaging materials, sugar and other sweeteners, oranges and orange juice. Non-cancelable marketing commitments are primarily for sports marketing. Bottler funding to independent bottlers is not reflected in our long-term contractual commitments as it is negotiated on an annual basis. Accrued liabilities for pension and retiree medical plans are not reflected in our long-term contractual commitments because they do not represent expected future cash outflows. See Pension and Retiree Medical Benefits for additional information regarding our pension and retiree medical obligations.