First Data 2012 Annual Report Download - page 46

Off-balance sheet arrangements
During 2012, 2011 and 2010, the Company did not engage in any off-balance sheet financing activities other than those
included in the “Contractual obligations” discussion below and those reflected in Note 11 to the Company’ s Consolidated Financial
Statements in Item 8 of this Form 10-K.
Contractual obligations
The Company’ s contractual obligations as of December 31, 2012 are as follows:
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(13) Represents impairment of certain equipment, land and a building.
(14) Includes items such as litigation and regulatory settlements, investment gains and losses, non-operating foreign currency gains
and losses and other as applicable to the period presented.
(15) EBITDA is defined as net income (loss) attributable to First Data Corporation before net interest expense, income taxes,
depreciation and amortization. EBITDA is not a recognized term under U.S. generally accepted accounting principles
(“GAAP”) and does not purport to be an alternative to net income (loss) attributable to First Data Corporation as a measure of
operating performance or to cash flows from operating activities as a measure of liquidity. Additionally, EBITDA is not
intended to be a measure of free cash flow available for management’ s discretionary use as it does not consider certain cash
requirements such as interest payments, tax payments and debt service requirements. The presentation of EBITDA has
limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of FDC’ s results as
reported under GAAP. Management believes EBITDA is helpful in highlighting trends because EBITDA excludes the results
of decisions that are outside the control of operating management and can differ significantly from company to company
depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which companies operate and
capital investments. Management compensates for the limitations of using non-GAAP financial measures by using them to
supplement GAAP results to provide a more complete understanding of the factors and trends affecting the business than
GAAP results alone.
Consolidated EBITDA (or debt covenant EBITDA) is defined as EBITDA adjusted to exclude certain non-cash items, non-
recurring items that FDC does not expect to continue at the same level in the future and certain items management believes will
impact future operating results and adjusted to include near-term cost savings projected to be achieved within twelve months on
an annualized basis (see Note 10 above). Consolidated EBITDA is further adjusted to add net income attributable to
noncontrolling interests and redeemable noncontrolling interests of certain non-wholly-owned subsidiaries and exclude other
miscellaneous adjustments that are used in calculating covenant compliance under the agreements governing FDC’ s senior
unsecured debt and/or senior secured credit facilities. The Company believes that the inclusion of supplementary adjustments to
EBITDA are appropriate to provide additional information to investors about items that will impact the calculation of EBITDA
that is used to determine covenant compliance under the agreements governing FDC’ s senior unsecured debt and/or senior
secured credit facilities. Since not all companies use identical calculations, this presentation of Consolidated EBITDA may not
b
e comparable to other similarly titled measures of other companies.
Pa
y
ments Due b
y
Period
(in millions) Total
Less than
1 year 1-3 years 4-5 years
After
5 years
Borrowings (a) $34,012.8 $1,982.5 $5,362.9 $ 7,878.2 $18,789.2
Capital lease obligations (b) 145.2 71.7 65.9 7.6
—
Operating leases 293.3 57.3 84.9 61.2 89.9
Pension plan contributions (c) 147.3 42.4 64.6 40.3
—
Purchase obligations (d):
Technology and telecommunications (e) 1,496.2 768.1 411.8 116.8 199.5
All other (f) 521.5 119.2 128.7 119.2 154.4
Other long-term liabilities 131.4 10.8 42.1 75.6 2.9
$36,747.7 $3,052.0 $6,160.9
$ 8,298.9
$19,235.9
(a) Includes future principal and cash interest payments on long-term borrowings through scheduled maturity dates. Includes $992.7
million of PIK toggle notes for which it is assumed the Company will pay interest in cash. Also includes $4.1 billion of variable
rate debt (including the impact of interest rate swaps). Borrowings and interest rate swaps are discussed in Note 8 and Note 6,
respectively, to the Company’ s Consolidated Financial Statements in Item 8 of this Form 10-K. Interest payments for the