Chrysler 2015 Annual Report Download - page 67

2015 | ANNUAL REPORT 67
Long-term liquidity requirements may involve some level of debt refinancing as outstanding debt becomes due or
we are required to make principal payments. Although we believe that our current level of total available liquidity is
sufficient to meet our short-term and long-term liquidity requirements, we regularly evaluate opportunities to improve
our liquidity position in order to enhance financial flexibility and to achieve and maintain a liquidity and capital position
consistent with that of other companies in our industry.
However, any actual or perceived limitations of our liquidity may limit the ability or willingness of counterparties,
including dealers, consumers, suppliers, lenders and financial service providers, to do business with us, or require us
to restrict additional amounts of cash to provide collateral security for our obligations. Our liquidity levels are subject to
a number of risks and uncertainties, including those described in the section —Risk Factors.
Total Available Liquidity
The following table summarizes our total available liquidity:
As of December 31,
(€ million) 2015(1) 2014 2013
Cash, cash equivalent and current securities(2) 21,144 23,050 19,702
Undrawn committed credit lines(3) 3,413 3,171 3,043
Total available liquidity(4) 24,557 26,221 22,745
(1) The assets of the Ferrari segment have been classified as Assets held for distribution within the Consolidated Statement of Financial Position
at December 31, 2015. These assets as well as the undrawn revolving credit facility of €500 million of Ferrari are not included in the figures
presented.
(2) Current securities comprise of short term or marketable securities which represent temporary investments but do not satisfy all the requirements
to be classified as cash equivalents as they may not be able to be readily converted into cash, or they are subject to significant risk of change
in value (even if they are short-term in nature or marketable).
(3) Excludes the undrawn €0.3 billion medium/long-term dedicated credit lines available to fund scheduled investments at December31, 2015 (€0.9
billion was undrawn at December31, 2014 and €1.8 billion was undrawn at December 31, 2013) and the undisbursed €0.4 billion on the Mexico
Bank Loan (as defined below) at December31, 2015, which can be drawn subject to meeting the preconditions for additional disbursements.
(4) The majority of our liquidity is available to our treasury operations in Europe, U.S. (subject to the restrictions on FCA US distributions as
described above), and Brazil; however, liquidity is also available to certain subsidiaries which operate in other areas. Cash held in such
countries may be subject to restrictions on transfer depending on the foreign jurisdictions in which these subsidiaries operate. Based on our
review of such transfer restrictions in the countries in which we operate and maintain material cash balances, we do not believe such transfer
restrictions have an adverse impact on the Group’s ability to meet its liquidity requirements at the dates presented above.
Our liquidity is principally denominated in U.S.Dollar and in Euro. Out of the total €21.1 billion of cash, cash
equivalents and current securities available at December31, 2015 (€23.0 billion at December31, 2014, €19.7 billion
at December31, 2013), €12.6 billion, or 59.7 percent were denominated in U.S.$ (€10.6 billion, or 46.0 percent, at
December31, 2014, €8.3 billion, or 42.1 percent, at December 31, 2013) and €3.4 billion, or 16.1 percent, were
denominated in Euro (€6.2 billion, or 27.0 percent, at December31, 2014, €6.1 billion, or 31.0 percent, at December
31, 2013). Liquidity available in Brazil and denominated in Brazilian Real accounted for €1.2 billion or 5.6 percent at
December31, 2015 (€1.6 billion or 7.0 percent, at December31, 2014, €1.5 billion, or 7.6 percent, at December 31,
2013), with the remainder being distributed in various countries and denominated in the relevant local currencies.
In June 2015, FCA entered into a new €5.0 billion syndicated revolving credit facility (“RCF”) for general corporate
purposes and the working capital needs of the Group. The RCF replaced and expanded the €2.1 billion three-year
revolving credit facility entered into by FCA on June 21, 2013 and replaced the U.S.$1.3 billion five-year revolving
credit facility of FCA US (“FCA US RCF”) that was scheduled to expire on May 24, 2016. On November 25, 2015, FCA
US terminated its undrawn FCA US RCF. The RCF is available in two tranches and as of December 31, 2015, the first
tranche of €2.5 billion was available and was undrawn. The first tranche matures in July 2018 and has two extension
options (1-year and 11-months, respectively) which are exercisable on the first and second anniversary of signing.
The second tranche, which consists of an additional €2.5 billion, matures in June 2020 and will be available upon the
elimination of the restrictions under certain of FCA US’s financing documentation on the provision of guarantees and
payment of dividends by FCA US for the benefit of the rest of the Group (refer to the section —Capital Market - Senior
Credit Facilities - FCA US below). The covenants of the RCF include financial covenants (Net Debt/Adjusted Earnings
Before Interest, Depreciation and Amortization (“Adjusted EBITDA”) and Adjusted EBITDA/Net Interest ratios related to
industrial activities) and negative pledge, pari passu, cross default and change of control clauses. The failure to comply
with these covenants, and in certain cases if not suitably remedied, can lead to the requirement of early repayment of
any outstanding amounts. At December 31, 2015, FCA was in compliance with the covenants of the RCF.