2008 Registration Document - Rexel

7. Liquidity and capital resources− three-month rolling average default ratio, equal to or lessthan 8.75%;− three-month rolling average late payment ratio, equal toor less than 4.25%;− three-month rolling average credit ratio, equal to or lessthan 5.0%;− coverage ratio: amount of receivables portfolio (eligible ornot)/amount of financing plus amount of reserves mustbe equal to or higher than 108%; and− ratio of selling days equal to or less than 66 days.Rexel, Inc. must also have shareholders’ equity at leastequal to 10% of the receivables portfolio.The ratios to be respected under the Canadian securitizationprogram include:− default ratio: (tranche of receivables in arrears of at least91 days and less than 180 days + receivables becomingdisputed during the month)/total amount of receivablesissued in months m-6, m-5 and m-4, less than or equalto 6.5%;− late payment ratio: tranche of receivables in arrears ofmore than 60 days and less than 91 days/total amount ofreceivables at the end of the month, equal to or less thanor equal to 8.25%;− credit ratio: amount of receivables subject to full or partialdepreciation or disputed during the month/total amountof gross billings generated during month m-2, less thanor equal to 10%;− loss ratio: amount of receivables subject to full impairmentduring the month/total amount received during the month,less than or equal to 1.0%;− the highest of the average default ratios for any threeconsecutive months during the last 12 months, less thanor equal to 5.0%; and− three-month rolling average credit ratio, less than or equalto 9.15%.The ratios to be respected under the securitization program(Germany, the United Kingdom, Spain, Belgium and TheNetherlands) include:− dilution ratio: receivables subject to a credit note/totalnet amount of sales corresponding to such credit notes,equal to or less than 7.5%;− arrears ratio: rate of receivables in arrears of 60 to90 days/total amount of sales corresponding to sucharrears, equal to or less than 4.7%;− default ratio: tranches of receivables of more than120 days at month-end plus disputed receivables/amount of sales corresponding to these arrears, equal toor less than 2.5%.7.2.3 Other indebtednessAt December 31, 2008, the Rexel Group’s otherindebtedness included:Financing leasesThe Rexel Group’s entered into direct financing leasesrelating to IT and real property assets, for a total amount of€27 million as at December 31, 2008.Bond issuanceIn 1998, Rexel Distribution entered into a €45.7 million(initially 300 million French francs) bond issuance comprising300,000 zero-coupon bonds with a nominal value of€152.45, redeemable on May 11, 2008. Furthermore, inorder to protect itself against the changes in the marketvalue of the bonds, and ensure a redemption of the bondissuance at the level of its nominal value, Rexel Distributionhad entered into a swap offering this protection in exchangefor a quarterly interest payment at thee-month Euribor less0.08%.On May 11, 2008, Rexel Distribution redeemed thisbond issue at €183.8354 per bond, for a total amountof €55.75 million. Under the swap implemented,Rexel Distribution received an amount of €9.5 millioncorresponding to the net difference between the last interestpayment at the rate of three-month EURIBOR minus 0.08%and the fair market value of the swap. Therefore, the netamount paid by Rexel under the redemption of the bondissue amounted to €45.7 million, corresponding to thenominal value of the bond issuance.7.2.4 Contractual commitmentsThe following table sets forth the maturities of theRexel Group’s debts, leases and service agreements atDecember 31, 2008.Amount remaining due at December 31,(in millions of euros)Total 2009 2010 2011 2012 ThereafterGross financial debt 3,739.0 272.3 328.9 264.5 2,598.0 275.3Operating leases 645.9 169.4 131.7 100.5 73.8 170.5Service agreements 113.4 23.6 23.8 23.8 23.8 18.4PAGE 88 | REXEL 2008