World Fuel Services 2015 Annual Report Download - page 36

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in part by a global design and deployment of an upgrade to our existing ERP platform. We are currently in the early planning
phase and the cost incurred to date is not considered significant. We expect the total cost of the project over the next three
years to range between $30.0 million and $40.0 million.
Credit Facility and Term Loans. We have a Credit Facility which permits borrowing up to $1.26 billion with a sublimit of
$400.0 million for the issuance of letters of credit and bankers’ acceptances. Under the Credit Facility, we have the right to
request increases in available borrowings up to an additional $150.0 million, subject to the satisfaction of certain conditions.
The Credit Facility matures in October 2018. We had outstanding borrowings under our Credit Facility totaling $416.0 million
and $420.0 million as of December 31, 2015 and 2014, respectively. Our issued letters of credit under the Credit Facility
totaled $5.5 million and $14.8 million as of December 31, 2015 and 2014, respectively. We also had $333.2 million and
$241.3 million in Term Loans outstanding as of December 31, 2015 and 2014, respectively. As of December 31, 2015 and
2014, the unused portion of our Credit Facility was $838.5 million and $665.2 million, respectively.
Our liquidity, consisting of cash and cash equivalents and availability under the Credit Facility fluctuates based on a number
of factors, including the timing of receipts from our customers and payments to our suppliers as well as commodity prices. Our
Credit Facility and our Term Loans contain certain financial and other covenants with which we are required to comply. Our
failure to comply with the covenants contained in our Credit Facility and our Term Loans could result in an event of default. An
event of default, if not cured or waived, would permit acceleration of any outstanding indebtedness under the Credit Facility
and our Term Loans, trigger cross-defaults under certain other agreements to which we are a party and impair our ability to
obtain working capital advances and issue letters of credit, which would have a material adverse effect on our business,
financial condition, results of operations and cash flows. As of December 31, 2015, we were in compliance with all financial
and other covenants contained in our Credit Facility and our Term Loans.
Other Credit Lines and Receivables Purchase Agreements. Additionally, we have other uncommitted credit lines primarily
for the issuance of letters of credit, bank guarantees and bankers’ acceptances. These credit lines are renewable on an
annual basis and are subject to fees at market rates. As of December 31, 2015 and 2014, our outstanding letters of credit
and bank guarantees under these credit lines totaled $208.4 million and $211.4 million, respectively. We also have
Receivables Purchase Agreements (“RPAs”) that allow for the sale of up to an aggregate of $499.0 million of our accounts
receivable. As of December 31, 2015, we had sold accounts receivable of $118.4 million under the RPAs.
Short-Term Debt. As of December 31, 2015, our short-term debt of $25.5 million primarily represents the current maturities
(within the next twelve months) of Term Loan borrowing, certain promissory notes related to acquisitions and capital lease
obligations.
We believe that our cash and cash equivalents as of December 31, 2015 (of which $137.3 million was available for use by
our U.S. subsidiaries without incurring additional costs) and available funds from our Credit Facility, together with cash flows
generated by operations, remain sufficient to fund our working capital and capital expenditure requirements for at least the
next twelve months. In addition, to further enhance our liquidity profile, we may choose to raise additional funds which may
or may not be needed for additional working capital, capital expenditures or other strategic investments. Our opinions
concerning liquidity are based on currently available information. To the extent this information proves to be inaccurate, or
if circumstances change, future availability of trade credit or other sources of financing may be reduced and our liquidity
would be adversely affected. Factors that may affect the availability of trade credit or other forms of financing include our
financial performance (as measured by various factors, including cash provided by operating activities), the state of
worldwide credit markets, and our levels of outstanding debt. Depending on the severity and direct impact of these factors
on us, financing may be limited or unavailable on terms favorable to us.
Contractual Obligations and Off-Balance Sheet Arrangements
Our significant contractual obligations and off-balance sheet arrangements are set forth below. For additional information
on any of the following and other contractual obligations and off-balance sheet arrangements, see Notes 6 and 7 in the
notes to the consolidated financial statements in Item 15 of this 2015 10-K Report.