Avis 2014 Annual Report Download - page 58

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51
At December 31, 2014, the Company had various other uncommitted credit facilities available, which bear interest
at rates of 0.39% to 2.50%, under which it had drawn approximately $9 million.
The following table presents available funding under our debt arrangements related to our vehicle programs,
including related party debt due to Avis Budget Rental Car Funding, at December 31, 2014:
Total
Capacity(a) Outstanding
Borrowings
Available
Capacity
North America – Debt due to Avis Budget Rental Car Funding (b) $ 9,130 $ 6,340 $ 2,790
North America – Canadian borrowings (c) 796 489 307
International – Debt borrowings (d) 1,768 690 1,078
International – Capital Leases (e) 472 314 158
Truck Rental – Debt borrowings (f) 271 252 19
Other 31 31 —
Total $ 12,468 $ 8,116 $ 4,352
__________
(a) Capacity is subject to maintaining sufficient assets to collateralize debt.
(b) The outstanding debt is collateralized by approximately $8.0 billion of underlying vehicles and related assets.
(c) The outstanding debt is collateralized by $659 million of underlying vehicles and related assets.
(d) The outstanding debt is collateralized by approximately $1.2 billion of underlying vehicles and related assets.
(e) The outstanding debt is collateralized by $298 million of underlying vehicles and related assets.
(f) The outstanding debt is collateralized by $339 million of underlying vehicles and related assets.
The significant terms for our outstanding debt instruments, credit facilities and available funding arrangements as
of December 31, 2014, can be found in Notes 12 and 13 to our Consolidated Financial Statements.
LIQUIDITY RISK
Our primary liquidity needs include the payment of operating expenses, servicing of corporate and vehicle-related
debt and procurement of rental vehicles to be used in our operations. The present intention of management is to
reinvest the undistributed earnings of the Company’s foreign subsidiaries indefinitely into its foreign operations.
We do not anticipate the need to repatriate foreign earnings to the United States to service corporate debt or for
other U.S. needs. Our primary sources of funding are operating revenue, cash received upon the sale of vehicles,
borrowings under our vehicle-backed borrowing arrangements and our senior revolving credit facility, and other
financing activities.
As discussed above, as of December 31, 2014, we have cash and cash equivalents of $624 million, available
borrowing capacity under our committed credit facilities of $1.0 billion, and available capacity under our vehicle
programs of approximately $4.4 billion.
Our liquidity position could be negatively affected by financial market disruptions or a downturn in the U.S. and
worldwide economies, which may result in unfavorable conditions in the vehicle rental industry, in the asset-
backed financing market, and in the credit markets, generally. We believe these factors have in the past affected
and could in the future affect the debt ratings assigned to us by credit rating agencies and the cost of our
borrowings. Additionally, a downturn in the worldwide economy or a disruption in the credit markets could impact
our liquidity due to (i) decreased demand and pricing for vehicles in the used vehicle market, (ii) increased costs
associated with, and/or reduced capacity or increased collateral needs under, our financings, (iii) the adverse
impact of vehicle manufacturers, including Ford, General Motors, Chrysler, Peugeot, Volkswagen, Kia, Fiat,
Toyota, Mercedes, Volvo and BMW, being unable or unwilling to honor their obligations to repurchase or
guarantee the depreciation on the related program vehicles and (iv) disruption in our ability to obtain financing due
to negative credit events specific to us or affecting the overall debt market (see Item 1A. Risk Factors for further
discussion).
Our liquidity position could also be negatively impacted if we are unable to remain in compliance with the financial
and other covenants associated with our senior revolving credit facility and other borrowings including a maximum
leverage ratio. As of December 31, 2014, we were in compliance with the financial covenants governing our
indebtedness.