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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
84
The following table sets forth the aggregate minimum lease payments under capital and operating leases, the aggregate
annual principal payments due under our long-term debt, and the aggregate amounts expected to be spent for purchase
commitments (in millions).
Year
Capital
Leases
Operating
Leases
Debt
Principal
Purchase
Commitments
2013 $ 55 $ 342 $ 1,750 $ 629
2014 52 271 1,000 103
2015 50 203 101 22
2016 49 145 1 14
2017 48 118 375 7
After 2017 426 358 8,765 —
Total 680 $ 1,437 $ 11,992 $ 775
Less: imputed interest (240)
Present value of minimum capitalized lease payments 440
Less: current portion (31)
Long-term capitalized lease obligations $ 409
As of December 31, 2012, we had outstanding letters of credit totaling approximately $1.369 billion issued in connection
with our self-insurance reserves and other routine business requirements. We also issue surety bonds as an alternative to letters
of credit in certain instances, and as of December 31, 2012, we had $584 million of surety bonds written.
Available Credit
We maintain two credit agreements with a consortium of banks. One of these agreements provides revolving credit
facilities of $1.5 billion, and expires on April 11, 2013. Generally, amounts outstanding under this facility bear interest at a
periodic fixed rate equal to LIBOR for the applicable interest period and currency denomination, plus an applicable margin.
Alternatively, a fluctuating rate of interest equal to Citibank’s publicly announced base rate, plus an applicable margin, may be
used at our discretion. In each case, the applicable margin for advances bearing interest based on LIBOR is a percentage
determined by quotations from Markit Group Ltd. for our 1-year credit default swap spread, subject to a minimum rate of
0.10% and a maximum rate of 0.75%. The applicable margin for advances bearing interest based on the base rate is 1.00%
below the applicable margin for LIBOR advances (but not lower than 0.00%). We are also able to request advances under this
facility based on competitive bids for the applicable interest rate. There were no amounts outstanding under this facility as of
December 31, 2012.
The second agreement provides revolving credit facilities of $1.0 billion, and expires on April 12, 2017. Generally,
amounts outstanding under this facility bear interest at a periodic fixed rate equal to LIBOR for the applicable interest period
and currency denomination, plus an applicable margin. Alternatively, a fluctuating rate of interest equal to Citibank’s publicly
announced base rate, plus an applicable margin, may be used at our discretion. In each case, the applicable margin for advances
bearing interest based on LIBOR is a percentage determined by quotations from Markit Group Ltd. for our credit default swap
spread, interpolated for a period from the date of determination of such credit default swap spread in connection with a new
interest period until the latest maturity date of this facility then in effect (but not less than a period of one year). The applicable
margin is subject to certain minimum rates and maximum rates based on our public debt ratings from Standard & Poor’s Rating
Service and Moody’s Investors Service. The minimum applicable margin rates range from 0.100% to 0.375%, and the
maximum applicable margin rates range from 0.750% to 1.250%. The applicable margin for advances bearing interest based on
the base rate is 1.00% below the applicable margin for LIBOR advances (but not less than 0.00%). We are also able to request
advances under this facility based on competitive bids. There were no amounts outstanding under this facility as of
December 31, 2012.