First Data 2012 Annual Report Download - page 42

Cash flows from financing activities.
Short-term borrowings, net. The cash activity related to short-term borrowings in 2012 and 2011 resulted primarily from net
borrowings and paydowns on FDC’s international credit lines used principally to prefund settlement activity. In 2010, the cash activity
related to short-term borrowings resulted primarily from net borrowings on FDC’s senior secured revolving credit facility.
As of December 31, 2012, FDC’s senior secured revolving credit facility had commitments from financial institutions to provide
$1,515.3 million of credit, $499.1 million of which is due to expire on September 24, 2013 with the remainder due to expire between
June 24, 2015 and September 24, 2016. Besides the letters of credit discussed below, FDC had no amount outstanding against this
facility as of December 31, 2012 and 2011. Therefore, as of December 31, 2012, $1,470.2 million remained available under this
facility. Excluding the letters of credit, the maximum amount outstanding against this facility during 2012 was approximately $295
million while the average amount outstanding during 2012 was approximately $27 million.
FDC utilizes its revolving credit facility on a short-term basis to fund investing or operating activities when cash flows from
operating activities are not sufficient. The Company believes the capacity under its senior secured revolving credit facility, both before
and after the expiration of the commitments due to expire in 2013, will be sufficient to meet its short-term liquidity needs. FDC’s
senior secured revolving credit facility can be used for working capital and general corporate purposes.
There are multiple institutions that have commitments under this facility with none representing more than approximately 14%
of the remaining capacity.
Debt modification proceeds (payments) and related financing costs. The Company’s debt modifications and amendments
noted above were accounted for as modifications resulting in only the net effect of the transactions being reflected as a source or use
of cash excluding certain fees included in the Company’s results of operations.
During 2012, FDC received net cash proceeds of $10.8 million related to the 2012 debt modifications and offerings referred to
above, a substantial portion of which were used to pay related expenses that were included in the Company’s results of operations.
During the year ended December 31, 2011, FDC paid $18.6 million in fees related to the December 2010 debt exchange and
$21.1 million in fees related to the April 2011 debt modification and amendments.
The Company paid a net amount of $24.1 million in fees related to the August 2010 debt modification. The Company also paid
a net amount of $37.1 million for costs incurred during the fourth quarter of 2010 related to the December 2010 debt exchange.
Principal payments on long-term debt. In conjunction with the debt modifications and amendments discussed above, proceeds
from the issuance of new notes were used to prepay portions of the principal balances of FDC’s senior secured term loans which
satisfied the future quarterly principal payments until September 2018. Prior to the modifications, during 2010, the Company made
principal payments of $96.2 million related to its senior secured term loan facility.
During 2011 and 2010, the Company paid notes that came due totaling $32.6 million and $13.1 million, respectively. In
addition, the Company paid $34.1 million in debt restructuring fees in 2010.
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Year ended December 31,
Source/(use) (in millions) 2012 2011 2010
Short-term borrowings, ne
t
$99.1 $(107.3) $ 75.1
Accrued interest funded upon issuance of notes 6.5
—
—
Debt modification proceeds (payments) and related financing costs 10.8 (39.7)(61.2)
Principal payments on long-term debt (83.3) (104.5) (220.4)
Proceeds from sale-leaseback transactions 13.8 14.2
—
Distributions and dividends paid to noncontrolling interests and redeemable
noncontrolling interests (261.9) (327.3) (216.1)
Contributions from noncontrolling interests
—
0.8
—
Purchase of noncontrolling interests (25.1)
—
(213.3)
Redemption of Paren
t
’s redeemable common stock (1.7)(0.5)(2.5)
Cash dividends (6.7)(0.2)(14.9)
N
et cash used in financing activities
$(248.5) $ (564.5) $ (653.3)