Ingram Micro 2010 Annual Report Download - page 44

commencing March 1, 2011. We may redeem the notes in whole at any time or in part from time to time, at our
option, at redemption prices that are designated in the terms and conditions of the notes.
In April 2010, we terminated our revolving trade accounts receivable-backed financing program in North
America, which provided for up to $600,000 in borrowing capacity secured by substantially all U.S.-based
receivables, in conjunction with the execution in the same month of a new revolving trade accounts receivable-
backed financing program secured by a majority of our U.S.-based receivables. This new program provides for up to
$500,000 in borrowing capacity, and may, subject to the financial institutions’ approval and availability of eligible
receivables, be increased to $700,000 in accordance with the terms of the program. The interest rate of this new
program is dependent on designated commercial paper rates (or, in certain circumstances, an alternate rate) plus a
predetermined margin. The new program matures in April 2013. We had no borrowings at January 1, 2011 under
this new North American financing program and we had no borrowings under the terminated facility at January 2,
2010.
In January 2010, we entered into a new revolving trade accounts receivable-backed financing program in
EMEA that matures in January 2014 and provides for a borrowing capacity of up to A100,000, or approximately
$134,000 at January 1, 2011. The current program requires certain commitment fees, and borrowings under this
program incur financing costs based on EURIBOR plus a predetermined margin. We had no borrowings at
January 1, 2011 under this EMEA financing program.
We have two other revolving trade accounts receivable-backed financing programs in EMEA, which mature in
May 2013 and respectively provide for a maximum borrowing capacity of £60,000, or approximately $93,000, and
A90,000, or approximately $120,000, at January 1, 2011. These programs require certain commitment fees, and
borrowings under both programs incur financing costs, based on LIBOR and EURIBOR, respectively, plus a
predetermined margin. At January 1, 2011 and January 2, 2010, we had no borrowings outstanding under these
EMEA financing programs.
We have a multi-currency revolving trade accounts receivable-backed financing program in Asia Pacific,
which matures in September 2011 and provides borrowing capacity of up to 210,000 Australian dollars, or
approximately $215,000, at January 1, 2011. The interest rate is dependent upon the currency in which the drawing
is made and is related to the local short-term bank indicator rate for such currency plus a predetermined margin. We
had no borrowings outstanding at January 1, 2011 and had $57,526 outstanding at January 2, 2010 under this Asia
Pacific financing program.
Our ability to access financing under all our trade accounts receivable-backed financing programs in North
America, EMEA and Asia Pacific, as discussed above, is dependent upon the level of eligible trade accounts
receivable as well as continued covenant compliance. We may lose access to all or part of our financing under these
programs under certain circumstances, including: (a) a reduction in sales volumes leading to related lower levels of
eligible trade accounts receivable; (b) failure to meet certain defined eligibility criteria for the trade accounts
receivable, such as receivables remaining assignable and free of liens and dispute or set-off rights; (c) performance
of our trade accounts receivable; and/or (d) loss of credit insurance coverage for our EMEA and Asia Pacific
facilities. At January 1, 2011, our actual aggregate available capacity under these programs was approximately
$1,037,000 based on eligible trade accounts receivable available, against which we had no borrowings. Even if we
do not borrow, or choose not to borrow to the full available capacity of certain programs, most of our trade accounts
receivable-backed financing programs prohibit us from assigning, transferring or pledging the underlying eligible
receivables as collateral for other financing programs. At January 1, 2011, the amount of trade accounts receivable
which would be restricted in this regard totaled approximately $1,287,000.
We have a senior unsecured term loan facility with a bank syndicate in North America with an outstanding
balance of $234,375 at January 1, 2011 and $246,875 at January 2, 2010. The interest rate on this facility is based on
one-month LIBOR, plus a variable margin that is based on our debt ratings and leverage ratio. Interest is payable
monthly. Under the terms of the agreement, we are also required to pay a minimum of $3,125 of principal on the
loan on a quarterly basis and a balloon payment of $215,625 at the end of the loan term in August 2012. The
agreement also contains certain negative covenants, including restrictions on funded debt and interest coverage, as
well as customary representations and warranties, affirmative covenants and events of default.
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