DELPHI 2013 Annual Report Download - page 69

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• Offset by $95 million of decreased Adjusted EBITDA due to fluctuations in foreign currency exchange rates; and
• $35 million due to increased accruals for incentive compensation in 2012 related to our salaried workforce.
Liquidity and Capital Resources
Overview of Capital Structure
Our liquidity requirements are primarily to fund our business operations, including capital expenditures and working
capital requirements, as well as to fund debt service requirements and operational restructuring activities. Our primary sources
of liquidity are cash flows from operations, our existing cash balance, and as necessary, borrowings under available credit
facilities. To the extent we generate discretionary cash flow we may consider using this additional cash flow for optional
prepayments of existing indebtedness, strategic acquisitions, dividends on share capital, additional share repurchases, and/or
general corporate purposes. We will also continually explore ways to enhance our capital structure.
As of December 31, 2013, we had cash and cash equivalents of $1.4 billion and net debt (defined as outstanding debt less
cash and cash equivalents) of $1.0 billion. We also have access to additional liquidity pursuant to the terms of the $1.5 billion
Revolving Credit Facility and the €350 million committed European accounts receivable factoring facility described below. We
expect existing cash, available liquidity and cash flows from operations to continue to be sufficient to fund our global operating
activities, including restructuring payments, any mandatory payments required under the Credit Agreement as described below,
dividends on ordinary shares and capital expenditures. We also continue to expect to be able to move funds between different
countries to manage our global liquidity needs without material adverse tax implications, subject to current monetary policies
and to the terms of the Credit Agreement. Based on this, we believe we possess sufficient liquidity to fund our operations and
capital investments in 2014 and beyond.
On March 31, 2011, all outstanding Class A and Class C membership interests of Delphi Automotive LLP were redeemed
for $3,791 million and $594 million, respectively. In conjunction with the redemption transaction, Delphi Automotive LLP
incurred transaction-related fees and expenses totaling approximately $180 million, including amounts paid to certain
membership interest holders. In addition, Delphi Automotive LLP obtained necessary consents to the redemption of the Class A
and Class C membership interests and modified and eliminated specific rights provided to these membership interest holders.
Subsequent to the redemption transaction on March 31, 2011, Delphi Automotive LLP membership interest equity was
comprised of a single voting class of membership interests, the Class B membership interests of Delphi Automotive LLP. In
addition to this class of voting membership interests, non-voting Class E-1 membership interests were held by the Board of
Managers of Delphi Automotive LLP. These remaining membership interests were exchanged for shares of Delphi Automotive
PLC in conjunction with our initial public offering in November 2011 as described below.
On July 12, 2011, the Third Amended and Restated Limited Liability Partnership Agreement of Delphi Automotive LLP
was amended and restated by the Fourth Amended and Restated Limited Liability Partnership Agreement of Delphi Automotive
LLP (the “Fourth LLP Agreement”). The Fourth LLP Agreement was undertaken to further position us for our initial public
offering. Refer to Note 15. Shareholders' Equity and Net Income Per Share to the audited consolidated financial statements for
additional information.
In August 2011, the Board of Managers of Delphi Automotive LLP approved a repurchase program of Class B
membership interests. In 2011, prior to the initial public offering, 10,005 Class B membership interests were repurchased for a
cumulative cost of approximately $180 million at an average price per membership interests unit of $17,904. This was recorded
as a reduction to the carrying value of the Class B membership interests.
In October 2011, the Board of Managers of Delphi Automotive LLP approved a distribution of approximately $95
million, which was paid on December 5, 2011, principally in respect of taxes, to members who held membership interests as of
the close of business on October 31, 2011.
On May 19, 2011 Delphi Automotive PLC was formed as a Jersey public limited company, and had nominal assets, no
liabilities and conducted no operations prior to the completion of the initial public offering on November 22, 2011 of
24,078,827 ordinary shares by the selling shareholders for an aggregate purchase price of approximately $530 million,
immediately prior to which all of the outstanding equity of Delphi Automotive LLP was exchanged for 328,244,510 ordinary
shares, par value $0.01 in Delphi Automotive PLC. As a result, Delphi Automotive LLP became a wholly-owned subsidiary of
Delphi Automotive PLC. Delphi did not receive any proceeds from this offering, and incurred transaction fees and expenses of
approximately $44 million.
In October 2012, the Company increased its borrowings under the Tranche A Term Loan, as described below, by $363
million, in conjunction with the closing of the MVL acquisition on October 26, 2012.