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Notes to the Financial Statements
152 Ford Motor Company | 2011 Annual Report
NOTE 18. DEBT AND COMMITMENTS (Continued)
Credit Facilities
At December 31, 2011, Ford Credit and its majority-owned subsidiaries had about $714 million of contractually
committed unsecured credit facilities with financial institutions, including FCE's £440 million (equivalent to $683 million at
December 31, 2011) credit facility (the "FCE Credit Agreement") which matures in 2014. FCE drew $200 million as part of
its plans for periodic usage of the facility and at December 31, 2011, FCE had $483 million available for use. The FCE
Credit Agreement contains certain covenants, including an obligation for FCE to maintain its ratio of regulatory capital to
risk weighted assets at no less than the applicable regulatory minimum, and for the support agreement between FCE and
Ford Credit to remain in full force and effect (and enforced by FCE to ensure that its net worth is maintained at no less
than $500 million). In addition to customary payment, representation, bankruptcy, and judgment defaults, the FCE Credit
Agreement contains cross-payment and cross-acceleration defaults with respect to other debt.
In addition, at December 31, 2011, Ford Credit had about $7.9 billion of contractually-committed liquidity facilities
provided by banks to support its FCAR program of which $4.3 billion expire in 2012 and $3.6 billion expire in
2014. Utilization of these facilities is subject to conditions specific to the FCAR program and Ford Credit having a
sufficient amount of eligible retail assets for securitization. The FCAR program must be supported by liquidity facilities
equal to at least 100% of its outstanding balance. At December 31, 2011, about $7.9 billion of FCAR’s bank liquidity
facilities were available to support FCAR’s asset-backed commercial paper, subordinated debt or FCAR’s purchase of
Ford Credit asset-backed securities. At December 31, 2011, the outstanding commercial paper balance for the FCAR
program was $6.8 billion.
Committed Liquidity Programs
Ford Credit and its subsidiaries, including FCE, have entered into agreements with a number of bank-sponsored
asset-backed commercial paper conduits and other financial institutions. Such counterparties are contractually committed,
at Ford Credit's option, to purchase from Ford Credit eligible retail or wholesale assets or to purchase or make advances
under asset-backed securities backed by retail, lease, or wholesale assets for proceeds of up to $24 billion at
December 31, 2011 ($12.6 billion retail, $8 billion wholesale, and $3.4 billion lease assets), of which $7 billion are
commitments to FCE. These committed liquidity programs have varying maturity dates, with $21.6 billion having
maturities within the next twelve months (of which about $6.6 billion relates to FCE commitments) and the remaining
balance having maturities between January 2013 and August 2014. Ford Credit plans to achieve capacity renewals to
protect its global funding needs, optimize capacity utilization and maintain sufficient liquidity. Ford Credit's ability to obtain
funding under these programs is subject to having a sufficient amount of assets eligible for these programs as well as its
ability to obtain interest rate hedging arrangements for certain securitization transactions. Ford Credit's capacity in excess
of eligible receivables and operating leases would protect it against the risk of lower than planned renewal rates. At
December 31, 2011, $14.5 billion of these commitments were in use. These programs are free of material adverse
change clauses, restrictive financial covenants (for example, debt-to-equity limitations and minimum net worth
requirements), and generally credit rating triggers that could limit Ford Credit's ability to obtain funding. However, the
unused portion of these commitments may be terminated if the performance of the underlying assets deteriorates beyond
specified levels. Based on Ford Credit's experience and knowledge as servicer of the related assets, it does not expect
any of these programs to be terminated due to such events.