DELPHI 2013 Annual Report Download - page 73

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The indenture governing the 2013 Senior Notes limits, among other things, Delphi’s (and Delphi’s subsidiaries’) ability
to incur liens, enter into sale and leaseback transactions and merge with or into other entities. As of December 31, 2013, the
Company was in compliance with the provisions of the 2013 Senior Notes.
The senior notes are fully and unconditionally guaranteed, jointly and severally, by Delphi Automotive PLC and certain
of its existing and future subsidiaries that are directly or indirectly 100% owned by the Company, subject to customary release
provisions (other than in the case of Delphi Automotive PLC).
Other Financing
Accounts receivable factoring—Various accounts receivable factoring facilities are maintained in Europe and are
accounted for as short-term debt. These uncommitted factoring facilities are available through various financial institutions.
Additionally, during the year ended December 31, 2013, Delphi entered into a new accounts receivable factoring agreement in
Europe to replace and consolidate current European factoring facilities. The new agreement is a €350 million committed
facility and borrowings under the new program are subject to the availability of eligible accounts receivable. As of
December 31, 2013 and December 31, 2012, $1 million and $19 million, respectively, were outstanding under European
accounts receivable factoring facilities.
Capital leases and other—As of December 31, 2013 and December 31, 2012, approximately $47 million and
approximately $106 million, respectively, of other debt issued by certain international subsidiaries and capital lease obligations
were outstanding.
Government Programs—Delphi commonly seeks manufacturing development and financial assistance incentive
programs that may be awarded by government entities. Delphi has numerous technology and manufacturing development
programs that are competitively awarded from agencies of the U.S. Federal Government. These U.S. based programs are from
the U.S. Department of Transportation (“DOT”), the U.S. Department of Energy (“DOE”), and the U.S. Department of Defense
(“DoD”). We received approximately $8 million from these Federal agencies in the year ended December 31, 2013 for work
performed. These programs supplement our internal research and development funds and directly support our product focus of
Safe, Green and Connected. We continue to pursue many technology development programs by bidding on competitively
procured programs from DOT, DOE and DoD. Some of these programs were bid with us being the lead or “Prime Contractor”,
and some were bid with us as a “Subrecipient” to the Prime Contractor. For the year ended December 31, 2013, Delphi was
awarded ten new programs and two follow-on programs with over $7 million of U.S. Government funds that will be received
over the next 48 months.
Additionally, during the year ended December 31, 2013, we received approximately $27 million of capital spending
reimbursements related to specific capital spending initiatives which added manufacturing equipment capacity and employees
to Delphi facilities located in Eastern Europe.
Warranty settlement—On April 30, 2011, we paid €90 million (approximately $133 million at April 30, 2011 exchange
rates) under the terms of a March 2011 warranty settlement. In April 2012, we made the final scheduled payment of €60 million
(approximately $80 million at April 30, 2012 exchange rates) related to this matter. In September 2012, as a result of favorable
warranty claims experience, we reached a final settlement with our customer related to ongoing warranty claims for production
subsequent to the March 2011 settlement, and recorded a change in our previous estimate of warranty claims by recognizing a
$25 million reduction of warranty expense in cost of sales in September 2012.
Contractual Commitments
The following table summarizes our expected cash outflows resulting from financial contracts and commitments as of
December 31, 2013. We have not included information on our recurring purchases of materials for use in our manufacturing
operations. These amounts are generally consistent from year to year, closely reflect our levels of production, and are not long-
term in nature. The amounts below exclude as of December 31, 2013, the gross liability for uncertain tax positions of $61
million related to the items below. We do not expect a significant payment related to these obligations to be made within the
next twelve months. We are not able to provide a reasonably reliable estimate of the timing of future payments relating to the
non-current portion of obligations associated with uncertain tax positions. For more information, refer to Note 14. Income
Taxes to the audited consolidated financial statements included herein.