# Investments and Other Assets

| (Dollars in millions) | December 31, 1985 | December 31, 1984 |
|---|---|---|
| Program products, less accumulated amortization (1985, $1,765; 1984, $1,491) | $ 1,964 | $ 1,604 |
| Investments in finance subsidiaries | 1,095 | 1,220 |
| Goodwill, less accumulated amortization (1985, $49; 1984, $4) | 852 | 882 |
| Investment in Intel Corporation | 641 | 655 |
| Net investment in sales-type leases | 1,172 | 594 |
| U.S. fixed income securities, at cost (market value: 1984, $510). | — | 503 |
| Other investments and sundry assets | 1,160 | 612 |
| Total | $ 6,884 | $ 6,070 |

*Includes goodwill of $375 million at December 31, 1985 and $404 million at December 31, 1984 (net of accumulated amortization of $48 million and $27 million, respectively).

# Long-Term Debt

| (Dollars in millions) | December 31, 1985 | December 31, 1984 |
|---|---|---|
| **U.S. Operations:** | | |
| 7½% convertible subordinated debentures due 2004 | $ 1,285 | $ 1,285 |
| 10½% debentures due 2015 (with sinking fund payments 1996-2014) | 500 | — |
| 10¼% notes due 1995 | 500 | — |
| 9½% debentures due 2004 (with sinking fund payments to 2003) | 442 | 450 |
| 9½% notes due 1986 | — | 500 |
| **Other, payable in:** | | |
| (Average interest rate at December 31, 1985, in parentheses) | | |
| U.S. dollars, due 1986-2012 (11.6%) | 372 | 666 |
| Swiss francs, due 1986-1987 (4.3%) | 243 | 247 |
| German marks, due 1986-1988 (8.7%) | 187 | 210 |
| European currency units, due 1990 (8.25%) | 133 | — |
| **Total** | $ 3,662 | $ 3,358 |
| **Non-U.S. Operations:** | | |
| Various obligations, payable in: | | |
| (Average interest rate at December 31, 1985, in parentheses) | | |
| French francs, due 1986-1997 (11.3%) | 246 | 62 |
| Japanese yen, due 1986-2015 (7.0%) | 202 | 125 |
| U.S. dollars, due 1986-1992 (8.5%) | 171 | 123 |
| Other currencies, due 1986-1999 (15.7%) | 76 | 84 |
| **Total** | $ 695 | $ 394 |
| **Less: Net unamortized discount, related principally to the 7½%, 9½% and 10½% debentures** | | |
| | 4,357 | 3,752 |
| **Less: Current maturities** | | |
| | 12 | 10 |
| **Total** | $ 3,955 | $ 3,269 |

Annual maturity and sinking fund requirements in millions of dollars on long-term debt outstanding at December 31, 1985, are as follows:

1986, $390; 1987, $274; 1988, $239; 1989, $53; 1990, $332; 1991 and beyond, $3,069.

*The 7½% convertible subordinated debentures are unsecured subordinated obligations of IBM, which are convertible into IBM capital stock at a conversion price of $13.6565 per share. They will be redeemable, at discretion of the company, starting in November 1988 at a price of 104.725% of the principal amount, and at deeper prices thereafter. Sinking fund payments starting in 1994 are intended to retire 75% of the debentures prior to maturity. During 1985, conversions of debentures resulted in the issuance of 316 shares of IBM capital stock.