In 2007 and 2008, the Company issued an aggregate principal amount of $1.8 billion and $150 million of 12 1 / 2 % Notes, respectively. Interest is payable semi-annually and the notes are non-callable for five years and may then be called by the Company at a premium, which declines over time. The Company had the option to make interest payments on its 12 1 / 2 % Notes in the form of either cash or additional 12 1 / 2 % Notes through May 2010. In 2008, the Company elected to make its May interest payment of $121 million in cash and its November interest payment of $121 million in the form of additional 12 1 / 2 % Notes. In 2009, the Company elected to make both the May and November interest payments of $128.5 million and $54.7 million, respectively, in the form of additional 12 1 / 2 % Notes. In 2010, the Company made both the May and November interest payments in cash.
The indenture for the Company’s 12 1 / 2 % Notes requires the Company to secure the 12 1 / 2 % Notes with the property and assets of the Company and any future subsidiary guarantors (subject to certain exceptions). The requirement to secure the 12 1 / 2 % Notes will occur on the earlier of: 1) the date on which the 8% Notes are redeemed; or 2) the first date on which the Company is allowed to grant liens in excess of $300 million under the 8% Notes. The requirement to secure the 12 1 / 2 % Notes is limited to the amount of debt under the 12 1 / 2 % Notes that would trigger a requirement for the Company to equally and ratably secure the existing 8% Notes, 7 3 / 8 % Notes and the 7 7 / 8 % Notes.
In 2009, $1.3 billion of the 12 1 / 2 % Notes were exchanged for an equal principal amount of the newly-issued non-interest-bearing convertible debentures. Refer to the Debt Exchange section above for more details.
I am sure the recent mixed shelf is to deal with this debt when it becomes callable. In today's market, no need to pay 12.5% . I would imagine they would also deal with the callable 243M at 7&7/8 at this time as well. If etfc can increase earnings enough to meet its competitors, it can easily add some share dilution to take care of this problem. We have about 1/2 the share count of AMTD and 1/4 of SCHW. Maybe the uncertainty is what is keeping us down? I think everyone understands it is the best thing to do. All that interest savings will drop to the bottom line in 2013.