2012 ANNUAL REPORT 75 Notes to Consolidated Financial Statements Long-term debt consisted of the following: adjustment payments and was recorded as a reduction to Common Stock, with an offsetting credit to liabilities. This liability will be accreted over three years through interest charges to the statement of operations based on a constant rate calculation. The purchase contracts are reflected in our diluted earnings per share calculations using the treasury stock method. To finance the remainder of the cash consideration of the Goodrich acquisition and pay related fees, expenses and other amounts due and payable, we utilized $3.2 billion from the issuance of commercial paper and approximately $0.5 billion of cash and cash equivalents generated from operating activities. In addition, as a result of the Goodrich acquisition, we assumed $3.0 billion of debt, including an adjustment of $600 million to increase the value of long-term debt assumed to its fair market value. Details of the debt assumed are included in the long-term debt table below. On July 26, 2012, upon completing the Goodrich acquis- ition, we terminated the bridge credit agreement, initially entered into as of November 8, 2011, with various financial institutions that had provided for a $15 billion unsecured bridge loan facility which was available to partially fund the cash consideration of the Good- rich acquisition and pay related fees, expenses and other amounts due and payable by UTC as a result of the acquisition. See Note 2 for further details regarding the completion of the Goodrich acquis- ition. On December 6, 2012, we announced that we had com- menced cash tender offers for six series of outstanding notes issued by Goodrich. These offers expired on January 7, 2013. Holders validly tendering their notes by December 19, 2012 received consideration determined by reference to a fixed spread over the yield to maturity (or, in the case of one series, yield to call) of the applicable U.S. Treasury security with the same maturity, plus an early tender payment of $30 per $1,000 principal amount of notes accepted for purchase. Holders validly tendering their notes after December 19, 2012 but prior to January 8, 2013 received consideration determined by reference to a fixed spread over the yield to maturity (or, in the case of one series, yield to call) of the applicable U.S. Treasury security with the same maturity. A total of $635 million principal amount of all notes subject to the tender offer and $126 million of the fair value adjustment were repaid, including approximately $30.6 million principal amount of the 2018 notes, approximately $129 million principal amount of the 2020 notes, approximately $305.2 million principal amount of the 2021 notes, approximately $9.1 million principal amount of the 2027 notes, approximately $120.2 million principal amount of the 2036 notes, and approximately $40.8 million principal amount of the 2038 notes. The effective interest rate on these notes was between 3.6% and 7.1%. The extinguishment loss was approximately $26 million and was recognized within Interest expense, net in the accompany- ing Consolidated Statement of Operations. *** Includes notes and remaining fair market value adjustments that were assumed as a part of the Goodrich acquisition on July 26, 2012. ** The junior subordinated notes are redeemable at our option, in whole or in part, on a date not earlier than August 1, 2017. The redemption price will be the principal amount, plus accrued and unpaid interest, if any, up to but excluding the redemption date. We may extend or eliminate the optional redemption date as part of a remarketing of the junior subordinated notes which could occur between April 29, 2015 and July 15, 2015 or between July 23, 2015 and July 29, 2015. * We may redeem the above notes, in whole or in part, at our option at any time at a redemption price in U.S. Dollars equal to the greater of 100% of the principal amount of the notes to be redeemed or the sum of the present values of the remaining scheduled payments of principal and interest on the notes to be redeemed, discounted to the redemption date on a semiannual basis at the adjusted treasury rate plus 10-50 basis points. The redemption price will also include interest accrued to the date of redemption on the principal balance of the notes being redeemed. (DOLLARS IN MILLIONS) 2012 2011 LIBOR plus 0.270% floating rate notes due 2013 $ 1,000 $ – LIBOR plus 0.500% floating rate notes due 2015 500 – 1.200% notes due 2015* 1,000 – 4.875% notes due 2015* 1,200 1,200 6.290% notes due 2016*** 291 – 5.375% notes due 2017* 1,000 1,000 1.800% notes due 2017* 1,500 – 6.800% notes due 2018*** 99 – 6.125% notes due 2019*** 300 – 6.125% notes due 2019* 1,250 1,250 8.875% notes due 2019 272 272 4.500% notes due 2020* 1,250 1,250 4.875% notes due 2020*** 171 – 3.600% notes due 2021*** 295 – 8.750% notes due 2021 250 250 3.100% notes due 2022* 2,300 – 1.550% junior subordinated notes due 2022** 1,100 – 7.100% notes due 2027*** 141 – 6.700% notes due 2028 400 400 7.500% notes due 2029* 550 550 5.400% notes due 2035* 600 600 6.050% notes due 2036* 600 600 6.800% notes due 2036*** 134 – 7.000% notes due 2038*** 159 – 6.125% notes due 2038* 1,000 1,000 5.700% notes due 2040* 1,000 1,000 4.500% notes due 2042* 3,500 – Project financing obligations 100 127 Other debt (including capitalized leases)*** 403 131 Total principal long-term debt 22,365 9,630 Other (fair market value adjustments)*** 353 – Total long-term debt 22,718 9,630 Less current portion (1,121) (129) Long-term portion $ 21,597 $ 9,501