Xerox 2013 Annual Report Download - page 112

Credit Facility
We have a $2.0 billion unsecured revolving Credit Facility with a group of lenders that matures in 2016. The Credit
Facility contains a $300 letter of credit sub-facility, and also includes an accordion feature that would allow us to
increase (from time to time, with willing lenders) the overall size of the facility up to an aggregate amount not to
exceed $2.75 billion.
The Credit Facility provides a backstop to our $2.0 billion CP program. Proceeds from any borrowings under the
Credit Facility can be used to provide working capital for the Company and its subsidiaries and for general
corporate purposes.
At December 31, 2013 we had no outstanding borrowings or letters of credit under the Credit Facility.
The Credit Facility is available, without sublimit, to certain of our qualifying subsidiaries. Our obligations under the
Credit Facility are unsecured and are not currently guaranteed by any of our subsidiaries. Any domestic subsidiary
that guarantees more than $100 of Xerox Corporation debt must also guaranty our obligations under the Credit
Facility. In the event that any of our subsidiaries borrows under the Credit Facility, its borrowings thereunder would
be guaranteed by us.
Borrowings under the Credit Facility bear interest at our choice, at either (a) a Base Rate as defined in our Credit
Facility agreement, plus a spread that varies between 0.00% and 0.45% depending on our credit rating at the time
of borrowing, or (b) LIBOR plus an all-in spread that varies between 0.90% and 1.45% depending on our credit
rating at the time of borrowing. Based on our credit rating as of December 31, 2013, the applicable all-in spreads for
the Base Rate and LIBOR borrowing were 0.175% and 1.175%, respectively.
An annual facility fee is payable to each lender in the Credit Facility at a rate that varies between 0.10% and 0.30%
depending on our credit rating. Based on our credit rating as of December 31, 2013, the applicable rate is 0.20%.
The Credit Facility contains various conditions to borrowing and affirmative, negative and financial maintenance
covenants. Certain of the more significant covenants are summarized below:
(a) Maximum leverage ratio (a quarterly test that is calculated as principal debt divided by consolidated EBITDA, as
defined) of 3.75x.
(b) Minimum interest coverage ratio (a quarterly test that is calculated as consolidated EBITDA divided by
consolidated interest expense) may not be less than 3.00x.
(c) Limitations on (i) liens of Xerox and certain of our subsidiaries securing debt, (ii) certain fundamental changes to
corporate structure, (iii) changes in nature of business and (iv) limitations on debt incurred by certain
subsidiaries.
The Credit Facility also contains various events of default, the occurrence of which could result in termination of the
lenders' commitments to lend and the acceleration of all our obligations under the Credit Facility. These events of
default include, without limitation: (i) payment defaults, (ii) breaches of covenants under the Credit Facility (certain
of which breaches do not have any grace period), (iii) cross-defaults and acceleration to certain of our other
obligations and (iv) a change of control of Xerox.
Interest
Interest paid on our short-term and long-term debt amounted to $435, $464 and $538 for the years ended
December 31, 2013, 2012 and 2011, respectively.
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