2008 Registration Document - Rexel

13. Related party transactionsWe have performed those procedures which we considerednecessary in accordance with professional guidance issuedby the national auditing body (Compagnie Nationale desCommissaires aux Comptes). These procedures are intendedto verify that the information provided to us is in agreement withthe underlying documentation from which it was extracted.Fee LetterRelated partiesJean-Charles Pauze, in his capacity as Chairman of theManagement Board of your Company.Clayton Dubilier & Rice Fund VII L.P., Ray France Investmentand Merrill Lynch Global Private Equity Fund International IIL.P. in their capacity as shareholders of your Company.Description and purposeYour Supervisory Board authorized, on March 6, 2008, theentry into a Fee Letter between your Company and ClaytonDubilier & Rice Fund VII L.P., Ray France Investment andMerrill Lynch Global Private Equity Fund International II L.P.(the “Investors”) aiming at complementing and finalizingthe terms and conditions of the Equity Commitment Letterentered into on November 11, 2007. On December 19,2007, Rexel entered into the Senior Credit Agreement (asdefined below). Facility C of the Senior Credit Agreementwas reserved for financing the acquisition of the Hagemeyersecurities and paying the expenses and charges relatingthereto. Assuming that the proceeds of Asset Sales wouldnot have been sufficient to allow its repayment, this Facilityshould have been repaid, in particular, through a share capitalincrease of Rexel to be underwritten by the Investors. Underthe Fee Letter, Rexel has agreed to pay each of the Investors,in consideration for underwriting the subscription to theshare capital increase of Rexel: (i) a fee of 40 base points forthe period between November 11, 2007 until six months afterthe Closing Date, calculated on the basis of a subscriptionto the share capital increase underwritten by each of theInvestors, i.e., a total amount of €737 million divided betweenClayton Dubilier & Rice Fund VII LP (K€269,950), Eurazeo(K€262,230) and Merrill Lynch (K€204,820) and (ii) in theevent of the exercise by Rexel of the extension option inrelation to the term of Facility C, an additional fee of 20 basepoints for each additional 3-month period, calculated on thebasis of the amount underwritten by each of the Investors.Terms and conditionsYour Company recorded expenses in the amount ofK€2,948 in respect of this agreement during the yearended December 31, 2008. This agreement expired uponthe repayment of Facility C.Amendment to the Senior Credit AgreementRelated partiesJean-Charles Pauze, in his capacity as director of KeliumS.A.S. (formerly Ray Acquisition S.A.S.) and Chairman ofthe Management Board of your Company.Description and purposeYour Supervisory Board authorized your Company, onSeptember 19, 2008, to execute the Amendment N°1 tothe Senior Credit Agreement, intended to include a new lineof credit known as Facility A’ (dated September 22, 2008)and providing for the following amendments to the SeniorCredit Agreement: (i) the maximum total commitment of thebanks was reduced from K€5,400,000 to K€.3,300,000and (ii) a new credit line was created, known as Facility A’,of a maximum amount of K€60,000, with the same termsand conditions as the credit line known as Facility A, withthe exception of a priority mandatory early repayment ofthe credit line known as Facility A’ using the proceeds ofthe securitization program which will be set up with certainsubsidiaries of the Rexel Group.Terms and conditionsThis agreement had no impact on the financial statementsof your Company in the financial year ended December 31,2008.2 Related party agreements and commitmentsauthorized and approved during the financial yearThe agreements referred to in this paragraph, authorized bythe Supervisory Board on May 13, 2008, were presentedin our special report dated May 15, 2008 and have beenapproved by the shareholders’ meeting of May 20, 2008.Commitments at the benefit of membersof the Management Board of the Company in caseof termination of their dutiesDescription and purposeThe Supervisory Board approved, on May 13, 2008 thefinancial terms and conditions that would apply in the eventof termination of the duties of a member of the ManagementBoard and the performance targets in relation to the deferredcompensation items, in accordance with Article L.225-90 -1of the French Commercial Code and pursuant to the “TEPA”law dated August 21, 2007.Terms and conditions1 In the event of the termination of the employmentagreement at the option of the employer following the endof his duties as a corporate officer, and except in case ofserious misconduct (faute grave) or gross misconduct(faute lourde) :a. Jean-Charles Pauze will benefit of a contractualindemnity equal to 24 months of his Monthly ReferenceCompensation in his capacity as corporate officer oras an employee of the company. Monthly ReferenceCompensation is defined as the sum of gross fixedmonthly compensation received, including in his capacityas corporate officer, during the twelve months precedingthe month in which severance of contractual relationswould be served, plus the gross amount of the last bonusreceived in any capacity whatsoever, but excluding anyexceptional bonus, divided by twelve. This indemnity isdeemed to include the statutory severance indemnity(indemnité de licenciement légale) or severance indemnitypursuant to the collective bargaining agreement(indemnité conventionnelle de licenciement) due, aswell as any indemnity due pursuant to the employmentagreement. This indemnity shall not apply in the event ofPAGE 150 | REXEL 2008