UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 5, 2015

ANIXTER INTERNATIONAL INC.
(Exact name of registrant as specified in its charter)

 
			
Delaware	 	94-1658138	
(State or other jurisdiction
of incorporation or organization)	 	(I.R.S. Employer
Identification No.)	
Commission File Number: 001-10212
2301 Patriot Blvd.
Glenview, Illinois 60026
(224) 521-8000
(Address and telephone number of principal executive offices)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
 
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
 
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	
 
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

 

Item 1.01.	Entry into a Material Definitive Agreement .	
On October 5, 2015, Anixter Inc., a wholly-owned operating subsidiary of Anixter International Inc. (the “Company”), and certain of Anixter Inc.’s subsidiaries, entered into the following financing arrangements in connection with the previously disclosed acquisition of HD Supply’s Power Solutions business (the “Acquisition”).
New Receivables Facility
On October 5, 2015, Anixter Inc.’s subsidiary Anixter Receivables Corporation (“ARC”) entered into a receivables based five-year revolving credit facility (the “New Receivables Facility”) in an aggregate committed amount of $600 million with Anixter Inc., as servicer, JPMorgan Chase Bank, N.A., as Administrative Agent, and the lenders named therein. Borrowings under the New Receivables Facility are secured by a first lien on all assets of ARC and supported by an unsecured guarantee by the Company. The drawn pricing will range from LIBOR plus 125 basis points when the combined availability (the “Combined Availability”) under the New Receivables Facility and the Inventory Facility (defined below) is greater than $500 million to LIBOR plus 175 basis points when Combined Availability is less than $250 million. Undrawn fees will be 25 basis points if greater than 50% of the facility is drawn and 37.5 basis points if less than 50% of the facility is drawn.
The New Receivables Facility has a borrowing base of 85% of eligible receivables, subject to certain reserves.
Cash dominion will apply in the event that (i) certain events of default occur or (ii) the Combined Availability is less than the greater of $75.0 million or 10% of the New Receivables Facility and the Inventory Facility (collectively, the “Combined Facilities”).
In the event that (x) certain events of default occur or (y) the Combined Availability is less than the greater of $75.0 million or 10% of the Combined Facilities, Anixter Inc. will be subject to a minimum fixed charge coverage ratio of 1.0x. Acquisitions and restricted payments will be permitted, subject to, among other things, (i) Combined Availability of at least 20% of the Combined Facilities after giving pro forma effect to any acquisition or restricted payment or (ii) (a) Combined Availability of at least 15% of the Combined Facilities after giving pro forma effect to the acquisition or restricted payment and (b) maintenance of a minimum fixed charge coverage ratio of at least 1.1x after giving pro forma effect to the acquisition or restricted payment.
The New Receivables Facility provides for customary representations and warranties and customary events of default, generally with corresponding grace periods, including, without limitation, payment defaults with respect to the facility, covenant defaults, cross-defaults to other agreements evidencing material indebtedness, certain judgments and events of bankruptcy. Failure to refinance Anixter Inc.’s $350 million 5.625% Senior Notes due 2019 prior to January 31, 2019 will also constitute an event of default.
In connection with the entry into the New Receivables Facility, Anixter Inc. and ARC terminated its existing Second Amended and Restated Receivables Purchase Agreement (the “RPA”) among Anixter Receivables Corporation, as Seller, Anixter Inc., as the initial Servicer, the purchasers party thereto and JPMorgan Chase Bank, N.A., as agent for the purchasers.
In connection with the entry into the New Receivables Facility, on October 5, 2015, Anixter Inc. and ARC entered into a Third Amended and Restated Receivables Sale Agreement (the “Amended and Restated RSA”), which amended and restated the existing Second Amended and Restated Sales Agreement. The purpose of the Amended and Restated RSA is (i) to reflect the entry into the New Receivables Facility and the termination of the RPA, and (ii) to include in the receivables sold by Anixter Inc. to ARC receivables originated by Tri-Northern Holdings, Inc. and its subsidiaries (collectively, the “Tri-Ed Subsidiaries”) and subsidiaries acquired in the Acquisition (the “Power Solutions Subsidiaries”).
The foregoing descriptions of the New Receivables Facility and the Amended and Restated RSA do not purport to be complete and are qualified in their entirety by reference to the New Receivables Facility and the Amended and Restated RSA, copies of which are filed as Exhibits 10.1 and 10.2 hereto and are incorporated herein by reference.
Inventory Facility
On October 5, 2015, Anixter Inc. and certain of its subsidiaries (including the Tri-Ed Subsidiaries and Power Solutions Subsidiaries), as borrowers, entered into an asset based lending five-year revolving credit facility (the “Inventory Facility”) in an aggregate committed amount of $150 million with Wells Fargo Bank, National Association, as Administrative Agent, and the lenders named therein. Borrowings under the Inventory Facility are secured by a first lien on Anixter Inc.’s and certain of its subsidiaries’ personal property (other than excluded property (which includes, without limitation, all machinery and equipment, intellectual property and equity interests in foreign subsidiaries and certain other domestic subsidiaries)) and supported by a guarantee by the Company. The drawn pricing will range from LIBOR plus 125 basis points when the Combined Availability is greater than $500 million to LIBOR plus 175 basis points when Combined Availability is less than $250 million. Undrawn fees will be 25 basis points if greater than 50% of the facility is drawn, and 37.5 basis points if less than 50% of the facility is drawn.

The Inventory Facility has a borrowing base, (a) with respect to appraised eligible domestic inventory, of the lesser of (i) 85% of the net orderly liquidation value of such inventory and (ii) 75% of book value of such inventory, plus, (b) with respect to eligible domestic inventory not appraised, 40% of the net orderly liquidation value of such inventory, less (c) certain reserves.
Cash dominion will apply in the event that (x) certain events of default occur or (y) the Combined Availability is less than the greater of $75.0 million or 10% of the Combined Facilities.
In the event that (x) certain events of default occur or (y) the Combined Availability is less than the greater of $75.0 million or 10% of the Combined Facilities, Anixter Inc. will be subject to a minimum fixed charge coverage ratio of 1.0x.
The Inventory Facility provides for customary representations and warranties and customary events of default, generally with corresponding grace periods, including, without limitation, payment defaults with respect to the facility, covenant defaults, cross-defaults to other agreements evidencing material indebtedness, certain judgments and events of bankruptcy. Failure to refinance Anixter Inc.’s $350 million 5.625% Senior Notes due 2019 prior to January 31, 2019 will also constitute an event of default.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Inventory Facility, a copy of which is filed as Exhibits 10.3 hereto and is incorporated herein by reference.
Canadian Term Loan
On October 5, 2015, Anixter Inc.’s subsidiaries Anixter Canada Inc. and Tri-Ed ULC (collectively, the “Borrowers”) entered into a $300.0 million (CAD) term loan facility (the “CAD Term Loan”) with The Bank of Nova Scotia, as Administrative Agent, and The Bank of Nova Scotia and Bank of America, N.A., Canada Branch, as lenders. The term loan is and will be guaranteed by all present and future material Canadian subsidiaries of the Borrowers as well as Anixter Mid Holdings BV. The CAD Term Loan is secured by a first priority security interest in all of the assets of Anixter Canada Inc. and each of its Canadian subsidiaries (the “Borrowing Group”).
The CAD Term Loan will have a five year maturity. The drawn pricing will range from .375% to 1.250% over prime and 1.375% to 2.250% over the banker’s acceptance rate, depending on consolidated leverage ranging from less than or equal to 1.25x to equal to or greater than 3.00x. The term loan amortizes 5% in each of years 1 and 2, 10% in each of years 3 and 4 and 70% in year 5.
The Borrowing Group initially will be subject to a maximum leverage ratio of 4.25x and a minimum fixed charge coverage ratio of 3.0x.
The CAD Term Loan provides for customary representations and warranties and customary events of default, generally with corresponding grace periods, including, without limitation, payment defaults with respect to the facility, covenant defaults, cross-defaults to other agreements evidencing material indebtedness, certain judgments and events of bankruptcy. Failure to refinance Anixter Inc.’s $350 million 5.625% Senior Notes due 2019 prior to January 31, 2019 will also constitute an event of default.
The foregoing description does not purport to be complete and is qualified in its entirety by reference to the CAD Term Loan, a copy of which is filed as Exhibits 10.4 hereto and is incorporated herein by reference.
 
Item 1.02. 	Termination of a Material Definitive Agreement .	
The information regarding termination of the RPA set forth in Item 1.01 above is incorporated herein by reference.
On October 5, 2015, Anixter Inc. terminated and repaid its Five-Year Revolving Credit Agreement, dated April 8, 2011, and the related Second Amendment and Incremental Facility Agreement, dated as of August 27, 2014, with Wells Fargo Bank, National Association, as Administrative Agent, and other lenders named therein (the “Existing Credit Facility”).
 
Item 2.03. 	Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant.	
The information regarding the New Receivables Facility, the Inventory Facility and the CAD Term Loan set forth in Item 1.01 above is incorporated herein by reference.

On October 5, 2015, draws were made under the New Receivables Facility in the aggregate amount of $425.0 million and under the CAD Term Loan in the aggregate amount of $300.0 million (CAD). Anixter Inc. used the borrowings, together with net proceeds from an earlier offering of $350.0 million of 5.50% senior notes and cash on hand, to pay the consideration for the Acquisition, to refinance the Existing Credit Facility, and to pay related transaction fees and expenses.
The lenders under the New Receivables Facility, the Inventory Facility and the CAD Term Loan and their respective affiliates perform various financial advisory, investment banking and commercial banking services from time to time for the Company and its affiliates for which the Company or its affiliates pay customary compensation. In addition, the lenders under the New Receivables Facility and Inventory Facility were lenders the Existing Credit Facility.
 
Item 9.01. 	Financial Statements and Exhibits.	
 
 	(d)	Exhibits.	

10.1	  	Credit Agreement (Receivables Facility), dated as of as of October 5, 2015, by and among Anixter Inc. and the other borrowers party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent, and the lenders party thereto	
		
10.2	  	Third Amended And Restated Receivables Sale Agreement dated as of October 5, 2015 between Anixter Inc., as the Seller, and Anixter Receivables Corporation, as the Buyer	
		
10.3	  	Credit Agreement (Inventory Facility), dated as of as of October 5, 2015, by and among Anixter Inc. and the other borrowers party thereto, Wells Fargo Bank, National Association, as Administrative Agent, and the lenders party thereto	
		
10.4	  	Credit Agreement, dated as of as of October 5, 2015, by and among Anixter Canada, Inc. and Tri-Ed ULC, as borrowers, Anixter Mid Holdings B.V., as guarantor, The Bank of Nova Scotia, as Administrative Agent, and The Bank of Nova Scotia and Bank of America, N.A., Canada Branch, as lenders	

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	 		 	ANIXTER INTERNATIONAL INC.	
				
October 8, 2015	 		 	By:	 	/s/ Theodore A. Dosch	
	 		 		 	Theodore A. Dosch	
	 		 		 	Executive Vice President - Finance	
	 		 		 	and Chief Financial Officer	

Exhibit 10.1

 

CREDIT AGREEMENT
(Receivables Facility)
Dated as of October 5, 2015
among
ANIXTER RECEIVABLES CORPORATION ,
as Borrower,
ANIXTER INC.,
as Servicer,
THE LENDERS PARTY HERETO,
JPMORGAN CHASE BANK, N.A. ,
as Administrative Agent

J.P. MORGAN SECURITIES LLC
and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Joint Bookrunners and Joint Lead Arrangers
JPMORGAN CHASE BANK, N.A. and
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Co-Syndication Agents
and

BANK OF AMERICA, N.A., and SUNTRUST BANK ,
as Co-Documentation Agents

 

Table of Contents

 	 	 	  	Page	 	
ARTICLE I DEFINITIONS	  	 	1	  	
			
Section 1.01.	 	Defined Terms	  	 	1	  	
			
Section 1.02.	 	Classification of Loans and Borrowings	  	 	36	  	
			
Section 1.03.	 	Terms Generally	  	 	36	  	
			
Section 1.04.	 	Accounting Terms; GAAP	  	 	37	  	
			
Section 1.05.	 	Status of Obligations	  	 	37	  	
		
ARTICLE II THE CREDITS	  	 	38	  	
			
Section 2.01.	 	Commitments	  	 	38	  	
			
Section 2.02.	 	Loans and Borrowings	  	 	38	  	
			
Section 2.03.	 	Requests for Revolving Borrowings	  	 	38	  	
			
Section 2.04.	 	Protective Advances	  	 	39	  	
			
Section 2.05.	 	Swingline Loans and Overadvances	  	 	40	  	
			
Section 2.06.	 	Letters of Credit	  	 	41	  	
			
Section 2.07.	 	Funding of Borrowings	  	 	46	  	
			
Section 2.08.	 	Interest Elections	  	 	46	  	
			
Section 2.09.	 	Termination and Reduction of Commitments; Increase in Revolving Commitments	  	 	47	  	
			
Section 2.10.	 	Repayment and Amortization of Loans; Evidence of Debt	  	 	49	  	
			
Section 2.11.	 	Prepayment of Loans	  	 	50	  	
			
Section 2.12.	 	Fees	  	 	50	  	
			
Section 2.13.	 	Interest	  	 	51	  	
			
Section 2.14.	 	Alternate Rate of Interest	  	 	52	  	
			
Section 2.15.	 	Increased Costs	  	 	52	  	
			
Section 2.16.	 	Break Funding Payments	  	 	54	  	
			
Section 2.17.	 	Withholding of Taxes; Gross-Up	  	 	54	  	
			
Section 2.18.	 	Payments Generally; Allocation of Proceeds; Sharing of Set-offs	  	 	57	  	
			
Section 2.19.	 	Mitigation Obligations; Replacement of Lenders	  	 	60	  	
			
Section 2.20.	 	Defaulting Lenders	  	 	60	  	
			
Section 2.21.	 	Returned Payments	  	 	62	  	
		
ARTICLE III COLLECTIONS AND PAYMENTS	  	 	62	  	
			
Section 3.01.	 	Deemed Collections	  	 	62	  	
			
Section 3.02.	 	Collections During the Revolving Period	  	 	62	  	
			
Section 3.03.	 	Collections During the Amortization Period	  	 	63	  	
			
Section 3.04.	 	Payment Rescission	  	 	63	  	
 
i

Table of Contents
(Continued)

 	 	 	  	Page	 	
ARTICLE IV REPRESENTATIONS AND WARRANTIES	  	 	63	  	
			
Section 4.01.	 	Organization; Powers	  	 	63	  	
			
Section 4.02.	 	Authorization; Enforceability	  	 	63	  	
			
Section 4.03.	 	Governmental Approvals; No Conflicts	  	 	64	  	
			
Section 4.04.	 	Financial Condition; No Material Adverse Change	  	 	64	  	
			
Section 4.05.	 	Properties	  	 	65	  	
			
Section 4.06.	 	Litigation and Environmental Matters	  	 	65	  	
			
Section 4.07.	 	Compliance with Laws and Agreements; No Potential Amortization Event	  	 	66	  	
			
Section 4.08.	 	Investment Company Status	  	 	66	  	
			
Section 4.09.	 	Taxes	  	 	66	  	
			
Section 4.10.	 	ERISA	  	 	66	  	
			
Section 4.11.	 	Disclosure	  	 	66	  	
			
Section 4.12.	 	Performance	  	 	66	  	
			
Section 4.13.	 	Solvency	  	 	67	  	
			
Section 4.14.	 	Insurance	  	 	67	  	
			
Section 4.15.	 	Capitalization and Subsidiaries; Joint Venture; Partnership	  	 	67	  	
			
Section 4.16.	 	Security Interest in Collateral	  	 	67	  	
			
Section 4.17.	 	Reserved	  	 	67	  	
			
Section 4.18.	 	Federal Reserve Regulations	  	 	67	  	
			
Section 4.19.	 	Use of Proceeds	  	 	67	  	
			
Section 4.20.	 	Reserved	  	 	67	  	
			
Section 4.21.	 	Restricted Payments to AXE	  	 	68	  	
			
Section 4.22.	 	Anti-Corruption Laws and Sanctions	  	 	68	  	
			
Section 4.23.	 	HD Supply Acquisition	  	 	68	  	
			
Section 4.24.	 	Compliance with Credit and Collection Policy	  	 	68	  	
			
Section 4.25.	 	Enforceability of Contracts	  	 	68	  	
			
Section 4.26.	 	Eligible Receivables	  	 	69	  	
			
Section 4.27.	 	Indebtedness	  	 	69	  	
			
Section 4.28.	 	Remittances of Collections	  	 	69	  	
		
ARTICLE V CONDITIONS	  	 	69	  	
			
Section 5.01.	 	Effective Date	  	 	69	  	
			
Section 5.02.	 	Each Credit Event	  	 	73	  	
 
ii

Table of Contents
(Continued)

 	 	 	  	Page	 	
ARTICLE VI AFFIRMATIVE COVENANTS	  	 	74	  	
			
Section 6.01.	 	Financial Statements; Borrowing Base and Other Information	  	 	74	  	
			
Section 6.02.	 	Notices of Material Events	  	 	77	  	
			
Section 6.03.	 	Existence; Conduct of Business; Accounting	  	 	79	  	
			
Section 6.04.	 	Payment of Obligations	  	 	79	  	
			
Section 6.05.	 	Maintenance of Properties	  	 	79	  	
			
Section 6.06.	 	Books and Records; Inspection Rights and Audits	  	 	79	  	
			
Section 6.07.	 	Compliance with Laws and Material Contractual Obligations	  	 	80	  	
			
Section 6.08.	 	Use of Proceeds	  	 	80	  	
			
Section 6.09.	 	Reserved	  	 	80	  	
			
Section 6.10.	 	Insurance	  	 	80	  	
			
Section 6.11.	 	Casualty and Condemnation	  	 	81	  	
			
Section 6.12.	 	Depository Banks	  	 	81	  	
			
Section 6.13.	 	Employee Benefit Matters	  	 	81	  	
			
Section 6.14.	 	Additional Collateral; Further Assurances	  	 	82	  	
			
Section 6.15.	 	Keeping and Marking of Records and Books	  	 	82	  	
			
Section 6.16.	 	Compliance with Contracts and Credit and Collection Policy	  	 	82	  	
			
Section 6.17.	 	Performance and Enforcement of the Receivables Sale Agreement	  	 	83	  	
			
Section 6.18.	 	Ownership of Receivables; Security Interest in Receivables	  	 	83	  	
			
Section 6.19.	 	Separateness	  	 	83	  	
			
Section 6.20.	 	Collections	  	 	85	  	
			
Section 6.21.	 	Payments to the Originators	  	 	86	  	
			
Section 6.22.	 	Post-Closing Security Perfection	  	 	86	  	
		
ARTICLE VII NEGATIVE COVENANTS	  	 	8 6	  	
			
Section 7.01.	 	Indebtedness	  	 	86	  	
			
Section 7.02.	 	Liens	  	 	88	  	
			
Section 7.03.	 	Fundamental Changes	  	 	90	  	
			
Section 7.04.	 	Investments, Loans, Advances, Guarantees and Acquisitions	  	 	90	  	
			
Section 7.05.	 	Asset Sales	  	 	92	  	
			
Section 7.06.	 	Sale and Leaseback Transactions	  	 	93	  	
			
Section 7.07.	 	Swap Agreements	  	 	93	  	
 
iii

Table of Contents
(Continued)

 	 	 	  	Page	 	
Section 7.08.	 	Payments to AXE and Anixter; Certain Payments of Indebtedness	  	 	94	  	
			
Section 7.09.	 	Transactions with Affiliates	  	 	95	  	
			
Section 7.10.	 	Restrictive Agreements	  	 	95	  	
			
Section 7.11.	 	Amendment of Material Documents	  	 	96	  	
			
Section 7.12.	 	Employee Benefit Matters	  	 	96	  	
			
Section 7.13.	 	Environmental Liabilities	  	 	97	  	
			
Section 7.14.	 	Financial Covenants	  	 	97	  	
			
Section 7.15.	 	Change in Payment Instructions to Obligors	  	 	97	  	
			
Section 7.16.	 	Modifications to Contracts and Credit and Collection Policy	  	 	97	  	
			
Section 7.17.	 	Designation of Amortization Date	  	 	98	  	
			
Section 7.18.	 	Termination of Receivables Sale Agreement	  	 	98	  	
			
Section 7.19.	 	Name Change; Offices and Records	  	 	98	  	
			
Section 7.20.	 	Protection of Title	  	 	98	  	
		
ARTICLE VIII ADMINISTRATION AND COLLECTION	  	 	98	  	
			
Section 8.01.	 	Designation of the Servicer	  	 	98	  	
			
Section 8.02.	 	Duties of the Servicer	  	 	99	  	
			
Section 8.03.	 	Collection Notices	  	 	100	  	
			
Section 8.04.	 	Responsibilities of the Borrower	  	 	100	  	
			
Section 8.05.	 	Servicing Fees	  	 	100	  	
		
ARTICLE IX AMORTIZATION EVENTS	  	 	101	  	
		
ARTICLE X THE ADMINISTRATIVE AGENT	  	 	104	  	
			
Section 10.01.	 	Appointment	  	 	104	  	
			
Section 10.02.	 	Rights as a Lender	  	 	104	  	
			
Section 10.03.	 	Duties and Obligations	  	 	105	  	
			
Section 10.04.	 	Reliance	  	 	105	  	
			
Section 10.05.	 	Actions through Sub-Agents	  	 	105	  	
			
Section 10.06.	 	Resignation	  	 	106	  	
			
Section 10.07.	 	Non-Reliance	  	 	106	  	
			
Section 10.08.	 	Other Agency Titles	  	 	107	  	
			
Section 10.09.	 	Not Partners or Co-Venturers; Administrative Agent as Representative of the Secured Parties	  	 	107	  	
			
Section 10.10.	 	Flood Laws	  	 	108	  	
 
iv

Table of Contents
(Continued)

 	 	 	  	Page	 	
ARTICLE XI MISCELLANEOUS	  	 	108	  	
			
Section 11.01.	 	Notices	  	 	108	  	
			
Section 11.02.	 	Waivers; Amendments	  	 	110	  	
			
Section 11.03.	 	Expenses; Indemnity; Damage Waiver	  	 	112	  	
			
Section 11.04.	 	Successors and Assigns	  	 	117	  	
			
Section 11.05.	 	Survival	  	 	121	  	
			
Section 11.06.	 	Counterparts; Integration; Effectiveness; Electronic Execution	  	 	121	  	
			
Section 11.07.	 	Severability	  	 	122	  	
			
Section 11.08.	 	Right of Setoff	  	 	122	  	
			
Section 11.09.	 	Governing Law; Jurisdiction; Consent to Service of Process	  	 	122	  	
			
Section 11.10.	 	WAIVER OF JURY TRIAL	  	 	123	  	
			
Section 11.11.	 	Headings	  	 	123	  	
			
Section 11.12.	 	Confidentiality	  	 	123	  	
			
Section 11.13.	 	Several Obligations; Nonreliance; Violation of Law	  	 	124	  	
			
Section 11.14.	 	USA PATRIOT Act	  	 	124	  	
			
Section 11.15.	 	Disclosure	  	 	124	  	
			
Section 11.16.	 	Appointment for Perfection	  	 	124	  	
			
Section 11.17.	 	Interest Rate Limitation	  	 	124	  	
			
Section 11.18.	 	Marketing Consent	  	 	124	  	
 
v

					
SCHEDULES:	
			
Schedule	 	–	    	Commitment Schedule	
Schedule A	 	–	    	Collection Accounts	
Schedule B	 	–	    	Credit and Collection Policies	
Schedule C	 	–	    	Lock-Boxes	
Schedule D	 	–	    	Subsidiary Originators	
Schedule 4.03	 	–	    	Government Approvals; No Conflicts	
Schedule 4.05	 	–	    	Properties	
Schedule 4.06	 	–	    	Disclosed Matters	
Schedule 4.14	 	–	    	Insurance	
Schedule 4.15	 	–	    	Capitalization and Subsidiaries	
Schedule 6.22	 	–	    	Post-Closing Security Perfection	
Schedule 7.01	 	–	    	Existing Indebtedness	
Schedule 7.02	 	–	    	Existing Liens	
Schedule 7.04	 	–	    	Existing Investments	
Schedule 7.10	 	–	    	Restrictive Agreements	
	
EXHIBITS:	
			
Exhibit A	 	–	    	Form of Assignment and Assumption	
Exhibit B	 	–	    	Form of Opinion of Borrower’s Counsel	
Exhibit C	 	–	    	Form of Borrowing Base Certificate	
Exhibit D	 	–	    	Form of Compliance Certificate	
Exhibit E-1	 	–	    	U.S. Tax Certificate (For Foreign Lenders that are not Partnerships for U.S. Federal Income Tax Purposes)	
Exhibit E-2	 	–	    	U.S. Tax Certificate (For Foreign Participants that are not Partnerships for U.S. Federal Income Tax Purposes)	
Exhibit E-3	 	–	    	U.S. Tax Certificate (For Foreign Participants that are Partnerships for U.S. Federal Income Tax Purposes)	
Exhibit E-4	 	–	    	U.S. Tax Certificate (For Foreign Lenders that are Partnerships for U.S. Federal Income Tax Purposes)	
Exhibit F	 	–	    	Form of Perfection Certificate	
Exhibit G	 	–	    	Form of Intercreditor Agreement	
 
vi

CREDIT AGREEMENT
(Receivables Facility)
CREDIT AGREEMENT dated as of October 5, 2015 (as it may be amended or modified from time to time, this “ Agreement ”) among ANIXTER RECEIVABLES CORPORATION , a Delaware corporation, as the Borrower, ANIXTER INC. , a Delaware corporation, as the Servicer, the Lenders (as defined herein) party hereto, JPMORGAN CHASE BANK, N.A. , a national banking association, as administrative agent for each Lender (in such capacity, together with its successors and assigns in such capacity, the “ Administrative Agent ”), WELLS FARGO BANK, NATIONAL ASSOCIATION , a national banking association and J.P. MORGAN SECURITIES LLC , as joint lead arrangers (in such capacity, together with their successors and assigns in such capacity, the “ Joint Lead Arrangers ”), as joint book runners (in such capacity, together with their successors and assigns in such capacity, the “ Joint Book Runners ”), JPMORGAN CHASE BANK, N.A . and WELLS FARGO BANK, NATIONAL ASSOCIATION , as co-syndication agents (in such capacity, together with their successors and assigns in such capacity, the “ Co-Syndication Agents ”), BANK OF AMERICA, N.A. , a national banking association and SUNTRUST BANK , a Georgia banking association, as co-documentation agents (in such capacity, together with their successors and assigns in such capacity, the “ Co-Documentation Agents ”).
The parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms . As used in this Agreement, the following terms have the meanings specified below:
“ 2011 Receivables Purchase Agreement ” means that certain Second Amended and Restated Receivables Purchase Agreement, dated as of May 31, 2011, by and among the Borrower, as the seller, Anixter, as the initial servicer, Chariot Funding LLC, as a conduit and the financial institutions from time to time party thereto, and JPMorgan Chase Bank, as the agent, as the same has been amended, restated, amended and restated, modified or supplemented from time to time.
“ 2012 Notes Indenture ” means an Indenture dated as of April 30, 2012, between Anixter, AXE, and Wells Fargo, as trustee, as the same may be amended or replaced from time to time.
“ ABR ”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, bear interest at a rate determined by reference to the Alternate Base Rate.
“ Accommodation Obligation ” means, as applied to any Person, any contractual obligation, contingent or otherwise, of that Person with respect to any Indebtedness or other obligation or liability of another, including any such Indebtedness, obligation or liability directly or indirectly guaranteed, supported by letter of credit, endorsed (otherwise than for collection or deposit in the ordinary course of business), co-made or discounted or sold with recourse by that Person, or in respect of which that Person is otherwise directly or indirectly liable, including Contractual Obligations (contingent or otherwise) arising through any agreement to purchase, repurchase, or otherwise acquire such Indebtedness, obligation or liability or any security therefor, or to provide funds for the payment or discharge thereof (whether in the form of loans, advances, stock purchases, capital contributions or otherwise), or to maintain solvency, assets, level of income, or other financial condition, or to make payment other than for value received. For purposes of interpreting any provision of this Agreement which refers to the amount

of Accommodation Obligations of any Person, such provision shall be deemed to mean the maximum amount of such Accommodation Obligations or, in the case of an Accommodation Obligation to maintain solvency, assets, level of income or other financial condition, the amount of Indebtedness to which such Accommodation Obligation relates, or if less, the stated maximum, if any, in the documents evidencing such Accommodation Obligation. Notwithstanding anything to the contrary contained herein, the term “Accommodation Obligation” shall not be interpreted to include any letter of credit Obligations or any other Obligations hereunder guaranteed by AXE or any other guarantor hereof.
“ Adjusted LIBO Rate ” means, with respect to any Eurodollar Borrowing for any Interest Period or for any ABR Borrowing, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.
“ Administrative Agent ” means JPMorgan Chase Bank, N.A., in its capacity as administrative agent for the Lenders hereunder.
“ Administrative Questionnaire ” means an Administrative Questionnaire in a form supplied by the Administrative Agent.
“ Affiliate ” means, as to any Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with, such Person. A Person shall be deemed to be “controlled by” any other Person if such other Person possesses, directly or indirectly, power (a) to vote 33% or more (or, in the case of an Affiliate of a Lender, 20% or more) of the securities (on a fully diluted basis) having ordinary voting power for the election of directors or managing general partners; or (b) to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
“ Aggregate Credit Exposure ” means, at any time, the aggregate Credit Exposure of all the Lenders at such time.
“ Aggregate Revolving Commitment ” means, at any time, the aggregate of the Revolving Commitments of all of the Lenders, as increased or reduced from time to time pursuant to the terms and conditions hereof. As of the Effective Date, the Aggregate Revolving Commitment is $600,000,000.
“ Aggregate Revolving Exposure ” means, at any time, the aggregate Revolving Exposure of all the Lenders at such time.
“ Agreement Accounting Principles ” means GAAP as of the date of this Agreement together with any changes in GAAP after the date hereof which are not Material Accounting Changes (as defined below). If any changes in GAAP are hereafter required or permitted and are adopted by AXE or Anixter with the agreement of its independent certified public accountants and such changes result in a material change in the method of calculation of any of the financial covenants, restrictions or standards herein or in the related definitions or terms used therein (“ Material Accounting Changes ”), the parties hereto agree to enter into negotiations, in good faith, in order to amend such provisions in a credit neutral manner so as to reflect equitably such changes with the desired result that the criteria for evaluating Anixter’s consolidated financial condition shall be the same after such changes as if such changes had not been made; provided , however , that no Material Accounting Change shall be given effect in such calculations until such provisions are amended in a manner reasonably satisfactory to the Required Lenders. If such amendment is entered into, all references in this Agreement to Agreement Accounting Principles shall mean GAAP as of the date of such amendment together with any changes in GAAP after the date of such amendment which are not Material Accounting Changes.
 
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“ Alternate Base Rate ” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus  1 ⁄ 2 of 1% and (c) the Adjusted LIBO Rate for a one month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%, provided that, the Adjusted LIBO Rate for any day shall be based on the LIBO Rate at approximately 11:00 a.m. London time on such day, subject to the interest rate floors set forth therein. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively. If the Alternate Base Rate is being used as an alternate rate of interest pursuant to Section 2.14 hereof, then the Alternate Base Rate shall be the greater of clause (a) and (b) above and shall be determined without reference to clause (c) above.
“ Amortization Date ” means the earliest to occur of: (a) the Business Day immediately prior to the occurrence of an Amortization Event set forth in clause (h), (i) or (j) of Article IX, (b) if any other Amortization Event has occurred and is continuing, the Business Day specified as the Amortization Date in a written notice given by the Administrative Agent or any Lender to the Borrower, and (c) the date that is five (5) Business Days after the Administrative Agent’s receipt of written notice from the Borrower that the Borrower wishes to terminate this Agreement.
“ Amortization Event ” has the meaning assigned to such term in Article IX.
“ Amortization Period ” means the period beginning on the Facility Termination Date and ending on the date thereafter on which the Commitments are reduced to zero or otherwise terminated pursuant to the terms hereof and the Aggregate Credit Exposure has been reduced to zero.
“ Anixter ” means Anixter Inc., a Delaware corporation.
“ Anixter Canada ” means Anixter Canada Inc., a Canada corporation.
“ Anti-Corruption Laws ” means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any of its Affiliates from time to time concerning or relating to bribery or corruption.
“ Applicable Commitment Fee Percentage ” means, as of any date of determination, the applicable percentage set forth in the following table that corresponds to the average usage of the Commitment by the Borrower for the most recently completed fiscal quarter:

Level	  	Average Usage	  	Applicable Commitment Fee Percentage	 	
I	  	³  50% of the
Commitment	  	 	0.250	% 	
II	  	< 50% of the
Commitment	  	 	0.375	% 	
“ Applicable Percentage ” means with respect to any Lender, (a) with respect to Revolving Loans, LC Exposure, Overadvances or Swingline Loans, a percentage equal to a fraction the numerator of which is such Lender’s Revolving Commitment and the denominator of which is the Aggregate Revolving Commitment ( provided that, if the Revolving Commitments have terminated or expired, the Applicable Percentages shall be determined based upon such Lender’s share of the Aggregate Revolving Exposure at that time), and (b) with respect to Protective Advances or with respect to the Aggregate Credit Exposure, a percentage based upon its share of the Aggregate Credit Exposure and the unused Commitments; provided that, in accordance with Section 2.20, so long as any Lender shall be a Defaulting Lender, such Defaulting Lender’s Commitment shall be disregarded in the calculations under clauses (a) and (b) above.
 
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“ Applicable Rate ” means, for any day, with respect to any Loan, or with respect to the commitment fees payable hereunder, as the case may be, the applicable rate per annum of (a) 0.50% in the case of ABR Loans and (b) 1.50% in the case of Eurodollar Loans.
Notwithstanding the foregoing, commencing January 1, 2016, the Applicable Rate will be subject to certain performance pricing adjustments set forth below under the caption “Revolver ABR Spread” and “Revolver Eurodollar Spread”, based upon the Average Quarterly Combined Availability during the most recently ended Fiscal Quarter.

Average Quarterly
Combined
Availability	  	Revolver
ABR Spread	 	 	Revolver
Eurodollar
Spread	 	
Category 1
³  $500,000,000	  	 	0.25	% 	 	 	1.25	% 	
Category 2
< $500,000,000 but
³  $250,000,000	  	 	0.50	% 	 	 	1.50	% 	
Category 3
< $250,000,000	  	 	0.75	% 	 	 	1.75	% 	
For purposes of the foregoing, (a) the Applicable Rate shall be determined based upon the Borrowing Base Certificates and related information that are delivered from time to time pursuant to Section 6.01, and (b) each change in the Applicable Rate resulting from a change in Average Quarterly Combined Availability shall be effective during the period commencing on and including the date of delivery to the Administrative Agent of a Borrowing Base Certificate and related information immediately following the most recently ended Fiscal Quarter and ending on the date immediately preceding the effective date of the next such change, provided that the Average Quarterly Combined Availability shall be deemed to be in Category 3 at the option of the Administrative Agent or at the request of the Required Lenders if the Borrower fails to deliver any Borrowing Base Certificate or related information required to be delivered pursuant to Section 6.01, during the period from the expiration of the time for delivery thereof until each such Borrowing Base Certificate is so delivered.
“ Approved Fund ” has the meaning assigned to such term in Section 11.04(b).
“ Assignment and Assumption ” means an assignment and assumption agreement entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 11.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.
“ Attributable Indebtedness ” means, on any date, (a) in respect of any Capital Lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a Capital Lease.
 
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“ Availability ” means, at any time, an amount equal to (a) the lesser of (i) the Aggregate Revolving Commitment and (ii) the Borrowing Base minus (b) the Aggregate Revolving Exposure (calculated, with respect to any Defaulting Lender, as if such Defaulting Lender had funded its Applicable Percentage of all outstanding Borrowings).
“ Availability Period ” means the period commencing on the Effective Date and ending on the Facility Termination Date.
“ Available Revolving Commitment ” means, at any time, the Aggregate Revolving Commitment minus the Aggregate Revolving Exposure (calculated, with respect to any Defaulting Lender, as if such Defaulting Lender had funded its Applicable Percentage of all outstanding Borrowings).
“ Average Quarterly Combined Availability ” means, for any Fiscal Quarter, an amount equal to the average daily Combined Availability during such Fiscal Quarter.
“ AXE ” means Anixter International Inc., a Delaware corporation.
“ AXE Guaranty ” means that certain Guaranty, dated as of the date hereof, made by AXE in favor of the Administrative Agent, for the benefit of the Administrative Agent and the other Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“ Bankruptcy Event ” means, with respect to any Person, when such Person becomes the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business, appointed for it, or, in the good faith determination of the Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment, provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person with immunity from the jurisdiction of courts within the U.S. or from the enforcement of judgments or writs of attachment on its assets or permits such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.
“ Beneficial Owner ” means, with respect to any U.S. federal withholding Tax, the beneficial owner, for U.S. Federal income tax purposes, to whom such Tax relates.
“ Benefit Plan ” means a defined benefit plan as defined in Section 3(35) of ERISA (other than a Multiemployer Plan) in respect of which Anixter or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an “employer” as defined in Section 3(5) of ERISA.
“ Board ” means the Board of Governors of the Federal Reserve System of the United States.
“ Borrower ” means Anixter Receivables Corporation, a Delaware corporation.
“ Borrower Subordinated Documents ” means the Borrower Subordinated Note, that certain Security Agreement by the Borrower in favor of Anixter, and any other agreements, documents, and instruments executed and delivered in connection therewith.
 
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“ Borrower Subordinated Note ” means that certain Third Amended and Restated Subordinated Note executed by the Borrower and payable to the order of Anixter, as the same may be amended, modified or supplemented from time to time.
“ Borrower Subordination Agreement ” means that certain Subordination and Intercreditor Agreement by and among Anixter, as the subordinated creditor, the Administrative Agent, and the Borrower, as the same may be amended, modified or supplemented from time to time.
“ Borrowing ” means (a) Revolving Loans of the same Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect, (b) a Swingline Loan, (c) a Protective Advance and (d) an Overadvance.
“ Borrowing Base ” means, at any time, the sum of (a) 85% of the aggregate Outstanding Balance of the Eligible Receivables at such time, minus (b) Reserves. The Administrative Agent may, in its Permitted Discretion, adjust Reserves or reduce one or more of the other elements used in computing the Borrowing Base, with any such changes to be effective three (3) days after delivery of notice thereof to the Borrower and the Lenders. The Borrowing Base at any time shall be determined by reference to the most recent Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 6.01(f).
“ Borrowing Base Certificate ” means a certificate, signed and certified as accurate and complete by a Financial Officer, in substantially the form of Exhibit C or another form which is acceptable to the Administrative Agent in its sole discretion.
“ Borrowing Base Deficiency ” means, at any time, that the Aggregate Revolving Exposure at such time exceeds the lesser of (a) the Aggregate Revolving Commitment at such time and (b) the Borrowing Base at such time.
“ Borrowing Request ” means a request by the Borrower for a Revolving Borrowing in accordance with Section 2.03.
“ Business Day ” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, (a) when used in connection with a Eurodollar Loan, the term “ Business Day ” shall also exclude any day on which banks are not open for general business in London and (b) any day that is not a “Business Day” under and as defined in the Inventory Facility Credit Agreement will not be a Business Day under this Agreement.
“ Capital Expenditures ” means, without duplication, any expenditure or commitment to expend money for any purchase or other acquisition of any asset which would be classified as a fixed or capital asset on a consolidated balance sheet of the Consolidated Group prepared in accordance with Agreement Accounting Principles.
“ Capital Lease ” means, as applied to any Person, any lease of any property (whether real, personal, or mixed) by that Person as lessee which, in conformity with Agreement Accounting Principles, is or should be accounted for as a capital lease on the balance sheet of that Person.
“ Cash Dominion Trigger Period ” means a period (a) commencing (i) automatically upon the occurrence of an Specified Amortization Event, (ii) at the written election of the Required Lenders upon the occurrence of any other Amortization Event, or (iii) when Combined Availability is less than the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment, and (b) continuing until (i) no Amortization Event is then continuing as described in clause (a)(i) above, and (ii) Combined Availability remains in excess of the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment for thirty (30) consecutive days. A Cash Dominion Trigger Period may be discontinued no more than five (5) times during the term of this Agreement.
 
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“ Cash Equivalents ” means (a) marketable direct obligations issued or unconditionally guaranteed by the government of the United States or issued by an agency thereof and backed by the full faith and credit of the United States, in each case maturing within ninety (90) days after the date of acquisition thereof, (b) money market funds consisting primarily of marketable direct obligations issued by any state or local government of the United States maturing within ninety (90) days after the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, then from such other nationally recognized rating services acceptable to the Administrative Agent) and not listed in “Credit Watch” published by S&P (or a similar publication of S&P or another nationally recognized rating service), (c) commercial paper (other than commercial paper issued by AXE, Anixter, or any Subsidiary of Anixter or any of their Affiliates), domestic and Eurodollar certificates of deposit, time deposits or bankers’ acceptances, in any such case maturing no more than ninety (90) days after the date of acquisition thereof and, at the time of the acquisition thereof, the issuer’s rating on its commercial paper is at least A-1 or P-1 from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, then the highest rating from other nationally recognized rating services acceptable to the Administrative Agent); and (d) commercial paper (other than commercial paper issued by AXE, Anixter, or any Subsidiary of Anixter or any of their Affiliates), domestic and Eurodollar certificates of deposit, time deposits or bankers’ acceptances, in any such case maturing no more than ninety (90) days after the date of acquisition thereof and, at the time of the acquisition thereof, the issuer is a Lender and has a rating on its commercial paper of at least A-2 or P-2 from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, then the equivalent rating from other nationally recognized rating services acceptable to the Administrative Agent), provided the amount of Cash Equivalents under this clause (d) shall not at any time exceed $5,000,000.
“ Change in Law ” means the occurrence after the date of this Agreement (or, with respect to any Lender, such later date on which such Lender becomes a party to this Agreement) of any of the following: (a) the adoption of or taking effect of any law, rule, regulation or treaty; (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority; or (c) compliance by any Lender or the Issuing Bank (or, for purposes of Section 2.15(b), by any lending office of such Lender or by such Lender’s or the Issuing Bank’s holding company, if any) with any request, guideline, requirement or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement; provided that, notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements or directives thereunder or issued in connection therewith or in the implementation thereof, and (y) all requests, rules, guidelines, requirements or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted, issued or implemented.
“ Change in Control ” shall occur if:
(a) any “person,” as such term is defined in Section 13(d)(3) of the Securities Exchange Act, other than the Samuel Zell Group, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act), directly or indirectly, of 33% or more of the combined voting power of AXE’s or Anixter’s outstanding securities ordinarily having the right to vote at elections of directors, and such person at such time owns more of such combined voting power than the Samuel Zell Group; or
 
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(b) individuals who, at the beginning of any period of twenty-four (24) consecutive months, constitute AXE’s board of directors (together with any new directors whose election by AXE’s board of directors or whose nomination for election by AXE’s shareholders was approved by a vote of at least a majority of the directors then still in office who either were directors at the beginning of such period or whose election or nomination was previously so approved) cease for any reason (other than death, disability or mandatory retirement) to constitute a majority of AXE’s board of directors then in office.
“ Charged-Off Receivable ” means a Receivable: (a) owed by an Obligor with respect to which a Bankruptcy Event has occurred; (b) as to which the related Obligor, if a natural person, is deceased, (c) which, consistent with the applicable Credit and Collection Policy, would be written off or otherwise designated as uncollectible, (d) which has been identified by the Servicer as uncollectible or (e) as to which any payment, or part thereof, remains unpaid for greater than one hundred twenty (120) days from the original invoice date for such Receivable.
“ Charges ” has the meaning assigned to such term in Section 11.17.
“ Chase ” means JPMorgan Chase Bank, N.A., a national banking association, in its individual capacity, and its successors.
“ Chase Parties ” has the meaning assigned to such term in Section 11.18.
“ Class ”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans, Swingline Loans or Protective Advances or Overadvances.
“ Code ” means the Internal Revenue Code of 1986, as amended from time to time.
“ Collateral ” means any and all property owned, leased or operated by the Borrower covered by the Collateral Documents and any and all other property of the Borrower, now existing or hereafter acquired, that may at any time be, become or be intended to be, subject to a security interest or Lien in favor of the Administrative Agent, on behalf of itself and the Lenders, to secure the Secured Obligations.
“ Collateral Documents ” means, collectively, the Security Agreement, and any other agreements, instruments and documents executed in connection with this Agreement that are intended to create, perfect or evidence Liens to secure the Secured Obligations, including, all other security agreements, pledge agreements, mortgages, deeds of trust, loan agreements, notes, guarantees, subordination agreements, pledges, powers of attorney, consents, assignments, contracts, fee letters, notices, leases, financing statements and all other written matter whether theretofore, now or hereafter executed by the Borrower and delivered to the Administrative Agent.
“ Collection Account ” means each concentration account, depositary account, lock-box account or similar account in which any Collections are collected or deposited and which is listed on Schedule A .
“ Collection Account Agreement ” means an agreement among the Borrower, the Servicer, the Administrative Agent and a Collection Bank perfecting the Administrative Agent’s security interest in one or more Collection Accounts.
“ Collection Bank ” means, at any time, any of the banks holding one or more Collection Accounts.
 
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“ Collection Notice ” means, with respect to a Collection Account Agreement, a notice given by the Administrative Agent to the related Collection Bank in substantially the form attached to such Collection Account Agreement or otherwise pursuant to which the Administrative Agent exercises its right to direct the disposition of funds on deposit in the Collection Account in accordance with such Collection Account Agreement.
“ Collection Period ” means each fiscal month of Anixter and the Borrower, provided that the final Collection Period shall terminate on the Facility Termination Date.
“ Collections ” means, with respect to any Receivable, all cash collections and other cash proceeds in respect of such Receivable, including, without limitation, all yield, Finance Charges or other related amounts accruing in respect thereof and all cash proceeds of Related Security with respect thereto.
“ Combined Availability ” means, at any time, an amount equal to (i) Availability plus (ii) Inventory Facility Availability, in each case at such time.
“ Combined Commitment ” means, at any time, an amount equal to (i) the Aggregate Revolving Commitments plus (ii) the Inventory Facility Commitment, in each case at such time.
“ Commercial LC Exposure ” means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding commercial Letters of Credit plus (b) the aggregate amount of all LC Disbursements relating to commercial Letters of Credit that have not yet been reimbursed by or on behalf of the Borrower. The Commercial LC Exposure of any Revolving Lender at any time shall be its Applicable Percentage of the aggregate Commercial LC Exposure at such time.
“ Commitment ” means, with respect to each Lender, the sum of such Lender’s Revolving Commitment, together with the commitment of such Lender to acquire participations in Protective Advances hereunder. The initial amount of each Lender’s Commitment is set forth on the Commitment Schedule , or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Commitment, as applicable.
“ Commitment Schedule ” means the Schedule attached hereto identified as such.
“ Communications ” has the meaning assigned to such term in Section 11.01(d).
“ Company Owned Post Office Box ” has the meaning assigned to such term in the Security Agreement.
“ Connection Income Taxes ” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
“ Consolidated EBITDA ” means, for any period, for the Consolidated Group calculated in accordance with Agreement Accounting Principles, (a) Consolidated Net Income for such period taken as a single accounting period plus (b) the sum of the following, without duplication, to the extent deducted in determining Consolidated Net Income for such period: (i) the provision for depreciation and amortization expense of the Consolidated Group for such period, (ii) income taxes of the Consolidated Group for such period, and (iii) net interest expense of the Consolidated Group for such period; provided that there shall be excluded from Consolidated EBITDA any non-cash, non-operating gains or losses (including, without limitation, extraordinary or unusual gains or losses, gains or losses arising from the sale of capital assets or the sale of owned buildings and properties and other non-recurring gains or losses) during such period.
 
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“ Consolidated Fixed Charge Coverage Ratio ” means, as of any date of determination, the ratio of (a) Consolidated EBITDA minus Unfinanced Capital Expenditures to (b) the Consolidated Fixed Charges, in each case determined in accordance with Section 7.14 for the period of four (4) consecutive Fiscal Quarters ending on or immediately prior to such determination date.
“ Consolidated Fixed Charges ” means, for any period, without duplication, cash Interest Expense of the Consolidated Group, plus scheduled principal payments on Indebtedness actually made, plus consolidated yield or discount accrued on the outstanding aggregate investment or principal amount of claims held by purchasers, assignees or other transferees of (or of interests in) receivables of Anixter and its Subsidiaries in connection with any Receivables Facility Transaction (regardless of the accounting treatment of such Receivables Facility Transaction), plus expenses for taxes paid in cash, plus Capital Lease payments for such period, all calculated in accordance with Agreement Accounting Principles.
“ Consolidated Group ” means Anixter and each of its Subsidiaries.
“ Consolidated Net Income ” means, for any period, for the Consolidated Group on a consolidated basis, the net income of the Consolidated Group for that period, determined in accordance with Agreement Accounting Principles.
“ Consolidated Tangible Net Assets ” has the meaning attributed to that term in the 2012 Notes Indenture.
“ Contract ” means a contract (including any purchase order or invoice) originally between an Originator and any Person pursuant to or under which such Person shall be obligated to make payments to such Originator with respect to the sale of goods or the furnishing of services from time to time. A “related” Contract with respect to a Receivable means a Contract under which such Receivable arises or which is relevant to the collection or enforcement of such Receivable.
“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.
“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “ Controlling ” and “ Controlled ” have meanings correlative thereto.
“ Credit and Collection Policy ” means (a) the Seller’s credit and collection policies and practices relating to Contracts and Receivables existing on the date hereof, (b) the credit and collection policies and practices of any Subsidiary Originator relating to Contracts and Receivables existing on the date hereof and (c) the credit and collection policies and practices of any other Originator relating to Contracts and Receivables existing on the date on which such other Originator was approved by the Administrative Agent, in each case as summarized in Schedule B and as modified from time to time in accordance with this Agreement.
“ Credit Exposure ” means, as to any Lender at any time, the sum of (a) such Lender’s Revolving Exposure at such time, plus (b) an amount equal to its Applicable Percentage, if any, of the aggregate principal amount of Protective Advances outstanding at such time.
“ Credit Party ” means the Administrative Agent, any Issuing Bank, the Swingline Lender or any other Lender.
 
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“ Customary Permitted Liens ” means:
(a) Liens (other than Environmental Liens, Liens imposed under ERISA or Enforceable Judgments) for Taxes not yet due or which are being contested in good faith by appropriate proceedings and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;
(b) statutory Liens of landlords, bankers, carriers, warehousemen, mechanics, materialmen and other Liens (other than Environmental Liens, Liens imposed under ERISA, or Enforceable Judgments) imposed by law, arising in the ordinary course of business and for amounts which (A) are not yet due, (B) are not more than thirty (30) days past due as long as no notice of default has been given or other action taken to enforce such Liens, or (C)(1) are not more than thirty (30) days past due and a notice of default has been given or other action taken to enforce such Liens, or (2) are more than thirty (30) days past due, and, in the case of clause (1) or (2), are being contested in good faith by appropriate proceedings which are sufficient to prevent imminent foreclosure of such Liens and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;
(c) Liens (other than Environmental Liens, Liens imposed under ERISA, or Enforceable Judgments) incurred or deposits made in the ordinary course of business (including, without limitation, surety bonds and appeal bonds) in connection with workers’ compensation, unemployment insurance and other types of employment benefits or to secure the performance of tenders, bids, leases, contracts (other than for the repayment of Indebtedness), statutory obligations and other similar obligations or arising as a result of progress payments under government contracts;
(d) easements (including, without limitation, reciprocal easement agreements and utility agreements), rights-of-way, covenants, consents, rights of landlords, reservations, encroachments, variations and other restrictions, charges or encumbrances (whether or not recorded) affecting the use of real property, which do not materially interfere with the ordinary conduct of the business of Anixter or any Subsidiary of Anixter;
(e) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods; and
(f) precautionary filings of financing statements in connection with assets that are not owned by Anixter or its Subsidiaries (including in connection with Operating Leases entered into in the ordinary course of business).
“ Deemed Collections ” means the aggregate of all amounts the Borrower shall have been deemed to have received as a Collection of a Receivable. The Borrower shall be deemed to have received a Collection in full of a Receivable if at any time (a) the Outstanding Balance of such Receivable is either (i) reduced as a result of any defective or rejected goods or services, any discount or any adjustment or otherwise by the Borrower (other than cash Collections on account of such Receivable or as a result of the insolvency, bankruptcy or lack of creditworthiness of the related Obligor or the financial inability of the related Obligor to pay) or (ii) reduced or canceled as a result of a setoff in respect of any claim by any Person (whether such claim arises out of the same or a related transaction or an unrelated transaction) or (b) any of the representations or warranties in Article IV are not true when made or deemed made with respect to such Receivable.
 
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“ Defaulting Lender ” means any Lender that (a) has failed, within two (2) Business Days of the date required to be funded or paid, to (i) fund any portion of its Loans, (ii) fund any portion of its participations in Letters of Credit or Swingline Loans or (iii) pay over to any Credit Party any other amount required to be paid by it hereunder, unless, in the case of clause (i) above, such Lender notifies the Administrative Agent in writing that such failure is the result of such Lender’s good faith determination that a condition precedent to funding (specifically identified and including the particular Potential Amortization Event, if any) has not been satisfied, (b) has notified the Borrower or any Credit Party in writing, or has made a public statement, to the effect that it does not intend or expect to comply with any of its funding obligations under this Agreement (unless such writing or public statement indicates that such position is based on such Lender’s good faith determination that a condition precedent (specifically identified and including the particular Potential Amortization Event, if any) to funding a Loan under this Agreement cannot be satisfied) or generally under other agreements in which it commits to extend credit, (c) has failed, within three (3) Business Days after request by a Credit Party, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations (and is financially able to meet such obligations) to fund prospective Loans and participations in then outstanding Letters of Credit and Swingline Loans under this Agreement, provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon such Credit Party’s receipt of such certification in form and substance satisfactory to it and the Administrative Agent, or (d) has become, or has a direct or indirect parent that has become, the subject of a Bankruptcy Event.
“ Dilutions ” means, at any time, the aggregate amount of reductions or cancellations described in clause (a) of the definition of “Deemed Collections”.
“ Disclosed Matters ” means the actions, suits, proceedings and environmental matters disclosed in Schedule 4.06 .
“ Disposition ” or “ Dispose ” means the sale, transfer, license, or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.
“ dollars ” or “ $ ” refers to lawful money of the U.S.
“ Domestic Subsidiary ” means a Subsidiary organized under the laws of a jurisdiction located in the U.S.
“ Effective Date ” means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 11.02).
“ Electronic Signature ” means an electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or record.
“ Electronic System ” means any electronic system, including e-mail, e-fax, Intralinks ® , ClearPar ® , Debt Domain, Syndtrak and any other Internet or extranet-based site, whether such electronic system is owned, operated or hosted by the Administrative Agent and the Issuing Bank and any of its respective Related Parties or any other Person, providing for access to data protected by passcodes or other security system.
 
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“ Eligible Receivables ” means, at any time, the Receivables of the Borrower which the Administrative Agent determines in its Permitted Discretion are eligible as the basis for the extension of Revolving Loans and Swingline Loans and the issuance of Letters of Credit. Without limiting the Administrative Agent’s discretion provided herein, Eligible Receivables shall not include any Receivable:
(a) which is not subject to a first priority perfected security interest in favor of the Administrative Agent;
(b) which is subject to any Lien other than (i) a Lien in favor of the Administrative Agent and (ii) a Permitted Encumbrance which does not have priority over the Lien in favor of the Administrative Agent;
(c) (i) which is unpaid more than ninety (90) days after the date of the original invoice therefor, or (ii) which has been written off or otherwise designated as uncollectible, provided , however , that otherwise Eligible Receivables, in an aggregate amount of up to 10% of the Aggregate Revolving Commitments, with payment terms of up to one hundred twenty (120) days which remain unpaid up to one hundred twenty (120) days after the invoice date, will not be deemed ineligible due to clause (c);
(d) which is owed by an Obligor for which more than 50% of the Receivables owing from such Obligor and its Affiliates are ineligible hereunder;
(e) which is owed by an Obligor to the extent the aggregate amount of Receivables owing from such Obligor and its Affiliates to the Borrower and/or any Originator exceeds 15% of the aggregate Eligible Receivables;
(f) with respect to which any covenant, representation or warranty contained in this Agreement or in the Security Agreement has been breached or is not true;
(g) which (i) does not arise from the sale of goods or performance of services in the ordinary course of business, (ii) is not evidenced by an invoice or other documentation satisfactory to the Administrative Agent which has been sent to the Originator, (iii) represents a progress billing, (iv) which are contingent upon any Originator’s completion of any further performance, (v) represents a sale on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment, cash-on-delivery or any other repurchase or return basis or (vi) relates to payments of interest;
(h) for which the goods giving rise to such Receivable have not been shipped to the Obligor or for which the services giving rise to such Receivable have not been performed by the Borrower or any Originator or if such Receivable was invoiced more than once;
(i) with respect to which any check or other instrument of payment has been returned uncollected for any reason;
(j) which is owed by an Obligor which has (i) applied for, suffered, or consented to the appointment of any receiver, custodian, trustee, or liquidator of its assets, (ii) had possession of all or a material part of its property taken by any receiver, custodian, trustee or liquidator, (iii) filed, or had filed against it, any request or petition for liquidation, reorganization, arrangement, adjustment of debts, adjudication as bankrupt, winding-up, or voluntary or involuntary case under any state or federal bankruptcy laws, (iv) admitted in writing its inability, or is generally unable to, pay its debts as they become due, (v) become insolvent, or (vi) ceased operation of its business;
 
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(k) which is owed by any Obligor which has sold all or substantially all of its assets;
(l) which is owed by an Obligor which (i) does not maintain its chief executive office in the U.S. or Canada or (ii) is not organized under applicable law of the U.S., any state of the U.S., or the District of Columbia, Canada, or any province of Canada unless, in any such case, such Receivable is backed by a Letter of Credit acceptable to the Administrative Agent which is in the possession of, and is directly drawable by, the Administrative Agent;
(m) which is owed in any currency other than U.S. dollars;
(n) which is owed by (i) any Governmental Authority of any country other than the U.S. unless such Receivable is backed by a Letter of Credit acceptable to the Administrative Agent which is in the possession of, and is directly drawable by, the Administrative Agent, or (ii) any federal Governmental Authority of the U.S., or any federal department, agency, public corporation, or instrumentality thereof, unless the Federal Assignment of Claims Act of 1940, as amended (31 U.S.C. § 3727 et seq . and 41 U.S.C. § 15 et seq .), and any other steps necessary to perfect the Lien of the Administrative Agent in such Receivable have been complied with to the Administrative Agent’s satisfaction;
(o) which is owed by any Affiliate of the Servicer or any Originator or any employee, officer or director of the Servicer or any of its Affiliates or any Originator or any of their Affiliates;
(q) which is owed by an Obligor or any Affiliate of such Obligor to which it is indebted, but only to the extent of such indebtedness, or is subject to any security, deposit, progress payment, retainage or other similar advance made by or for the benefit of an Obligor, in each case to the extent thereof;
(r) which is subject to any counterclaim, deduction, defense, setoff or dispute;
(s) which is evidenced by any promissory note, chattel paper or instrument;
(t) which is owed by an Obligor (i) located in any jurisdiction which requires filing of a “Notice of Business Activities Report” or other similar report in order to permit the Servicer to seek judicial enforcement in such jurisdiction of payment of such Receivable, unless the Borrower has filed such report or qualified to do business in such jurisdiction or (ii) which is a Sanctioned Person;
(u) with respect to which the Servicer has made any agreement with the related Obligor for any reduction thereof, other than discounts and adjustments given in the ordinary course of business, or any Receivable which was partially paid and such Originator created a new receivable for the unpaid portion of such Receivable;
(v) which does not comply in all material respects with the requirements of all applicable laws and regulations, whether federal, state or local, including the Federal Consumer Credit Protection Act, the Federal Truth in Lending Act and Regulation Z of the Board;
 
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(w) which is for goods that have been sold under a purchase order or pursuant to the terms of a contract or other agreement or understanding (written or oral) that indicates or purports that any Person other than the Borrower has or has had an ownership interest in such goods, or which indicates any party other than the Borrower as payee or remittance party;
(x) which was created on cash on delivery terms;
(y) which (i) does not satisfy in all material respects all applicable requirements of the applicable Credit and Collection Policy and (ii) is owed by an Obligor which is deemed to be a “high” collection risk in accordance with the applicable Credit and Collection Policy;
(z) as to which all right, title and interest to and in which has not been validly transferred by an Originator directly or indirectly to the Borrower pursuant to the Receivables Sale Agreement, or the Borrower does not have good and marketable title thereto free and clear of any lien (other than (i) pursuant to the Loan Documents and (ii) a Permitted Encumbrance which does not have priority over the Lien in favor of the Administrative Agent);
(aa) the Obligor on which is not required to make payments with respect to such Receivable into a concentration account, depositary account, lock-box account or similar account that is not subject to a Collection Account Agreement;
(bb) the assignment of which by the Seller to the Borrower (and the pledge of which by the Borrower to the Administrative Agent) violates any applicable contractual agreement not otherwise rendered ineffective by any applicable law;
(cc) as to which the Servicer is not in possession of, or does not have ready access to, the Records relating thereto and other information reasonably necessary or advisable for the collection of such Receivable;
(dd) which is owed by an Obligor which is an Obligor on any Receivable which has been sold or pledged to any Person other than the Borrower;
(ee) if it was acquired in an acquisition permitted by Section 7.04(a)(v), until the completion of an appraisal and field examination of such Receivable, in each case, reasonably satisfactory to the Administrative Agent (which appraisal and field examination may be conducted prior to the closing of such acquisition); or
(ff) which the Administrative Agent determines, in its Permitted Discretion, may not be paid by reason of the related Obligor’s inability to pay or which the Administrative Agent otherwise determines is unacceptable for any reason whatsoever, provided , that the Administrative Agent shall not determine a Receivable to be ineligible pursuant to this clause (ff) solely because the Obligor is in a particular industry if on the Effective Date any Originator has outstanding Receivables from Obligors in such industry which constituted Eligible Receivables; provided , further , that the Administrative Agent shall not determine a Receivable to be ineligible pursuant to this clause (ff) solely because it is generated by a particular type of business of any Originator if such Originator is engaged in such type of business on the Effective Date.
In the event that a Receivable which was previously an Eligible Receivable ceases to be an Eligible Receivable hereunder, the Borrower shall notify the Administrative Agent thereof on and at the time of submission to the Administrative Agent of the next Borrowing Base Certificate. In determining the amount of an Eligible Receivable, the face amount of a Receivable may, in the Administrative
 
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Agent’s Permitted Discretion, be reduced by, without duplication, to the extent not reflected in such face amount, (i) the amount of all accrued and actual discounts, claims, credits or credits pending, promotional program allowances, price adjustments, finance charges or other allowances (including any amount that the Borrower may be obligated to rebate to an Obligor pursuant to the terms of any agreement or understanding (written or oral)) and (ii) the aggregate amount of all cash received in respect of such Receivable but not yet applied by the Borrower to reduce the amount of such Receivable.
“ Enforceable Judgment ” means a judgment or order as to which (a) Anixter has not demonstrated to the reasonable satisfaction of the Required Lenders that Anixter and its Subsidiaries, as applicable, are covered by third-party insurance (other than retro-premium insurance) therefor and (b) the period, if any, during which the enforcement of such judgment or order is stayed shall have expired, it being understood that a judgment or order which is under appeal or as to which the time in which to perfect an appeal has not expired shall not be deemed an “Enforceable Judgment” so long as enforcement thereof is effectively stayed pending the outcome of such appeal or the expiration of such period, as the case may be; provided that if enforcement of a judgment or order has been stayed on condition that a bond or collateral equal to or greater than $35,000,000 be posted or provided, such judgment or order shall immediately be an “Enforceable Judgment.”
“ Enhanced Reporting Trigger Period ” means a period (a) commencing (i) automatically upon the occurrence of a Specified Amortization Event, (ii) at the written election of the Required Lenders upon the occurrence of any other Amortization Event, or (iii) when Combined Availability is less than the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment, and (b) continuing until (a) no Potential Amortization Event is then continuing and (ii) Combined Availability remaining in excess of the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment for thirty (30) consecutive days. An Enhanced Reporting Trigger Period may be discontinued no more than five (5) times during the term of this Agreement.
“ Environmental Laws ” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, binding agreements issued, promulgated or entered into by any Governmental Authority applicable to the Borrower or the Borrower’s operations, relating to the environment, preservation or reclamation of natural resources, the management, Release or threatened Release of any Hazardous Material, and all Permits issued in connection therewith.
“ Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary incurred as a result of (a) any violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) the Release or threatened Release of any Hazardous Materials into the environment or (d) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
“ Environmental Lien ” means a Lien in favor of any Governmental Authority for any Environmental Liability.
“ Equity Interests ” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any of the foregoing.
“ ERISA ” means the Employee Retirement Income Security Act of 1974, and any regulations issued pursuant thereto, as amended from time to time.
 
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“ ERISA Affiliate ” means any (i) corporation which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Code) as Anixter or any of its Subsidiaries, (ii) partnership or other trade or business (whether or not incorporated) under common control (within the meaning of Section 414(c) of the Code) with Anixter or any of its Subsidiaries, and (iii) member of the same affiliated service group (within the meaning of Section 414(m) of the Code) as Anixter or any of its Subsidiaries, any corporation described in clause (i), above or any partnership or trade or business described in clause (ii) above.
“ ERISA Event ” means (a) any Reportable Event with respect to any Plan; (b) the failure to make the “minimum required contributions” under Section 412 or 430 of the Code or Section 302 of ERISA, whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by Anixter or any ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) any Termination Event; or (f) the receipt by Anixter or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from Anixter or any ERISA Affiliate of any notice, concerning the imposition of withdrawal liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
“ Eurodollar ”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, bear interest at a rate determined by reference to the Adjusted LIBO Rate.
“ Excluded Taxes ” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient: (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes; (b) in the case of a Lender, U.S. Federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan, Letter of Credit or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan, Letter of Credit or Commitment (other than pursuant to an assignment request by the Borrower under Section 2.19(b)) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.17, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender acquired the applicable interest in a Loan, Letter of Credit or Commitment or to such Lender immediately before it changed its lending office; (c) Taxes attributable to such Recipient’s failure to comply with Section 2.17(f); and (d) any U.S. Federal withholding Taxes imposed under FATCA.
“ Facility Termination Date ” means the earlier of (a) the Maturity Date and (b) the Amortization Date.
“ FATCA ” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreement entered into pursuant to Section 1471(b)(1) of the Code.
“ Federal Funds Effective Rate ” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
 
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quotations for such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it; provided , that, if the Federal Funds Effective Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.
“ Fee Letter ” means that certain fee letter, dated as of even date with the Agreement, among the Borrower and the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent.
“ Finance Charges ” means, with respect to any Contract, any finance, interest, late payment charges or similar charges owing by an Obligor pursuant to such Contract.
“ Financial Covenant Trigger Period ” means a period (a) commencing (i) automatically upon the occurrence of a Specified Amortization Event, (ii) at the written election of the Required Lenders upon the occurrence of any other Amortization Event, or (iii) when Combined Availability is less than the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment, and (b) continuing until (i) no Amortization Event is then continuing, and (ii) Combined Availability remains in excess of the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment for thirty (30) consecutive days. A Financial Covenant Trigger Period may be discontinued no more than five (5) times during the term of this Agreement.
“ Financial Officer ” means, with respect to any Person, any of the chief financial officer, controller or treasurer of such Person and, with respect to Anixter shall include its Vice President-Finance and the Assistant Treasurer.
“ Fiscal Month ” means a four or five week monthly accounting period of Anixter ending on or about the last day of a calendar month.
“ Fiscal Quarter ” means a 13-week (or, as the case may be, periodically a 14-week) accounting period of Anixter ending on or about March 31, June 30, September 30 or December 31 of any Fiscal Year.
“ Fiscal Year ” means the fiscal year of Anixter, which shall be the annual accounting period of Anixter ending on or about December 31 of each year.
“ Flood Laws ” has the meaning assigned to such term in Section 10.10.
“ Foreign Employee Benefit Plan ” means any plan, program, policy, agreement or contract maintained or contributed to or for the benefit of employees or Anixter, any of its Subsidiaries, or any ERISA Affiliate which is governed by the laws of a jurisdiction outside the United States.
“ Foreign Lender ” means (a) if the Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if the Borrower is not a U.S. Person, a Lender that is resident or organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes.
“ Foreign Pension Plan ” means any pension plan or other deferred compensation plan, program or arrangement maintained or contributed to or for the benefit of employees of Anixter, any of its Subsidiaries, or any ERISA Affiliate, which, under the applicable local law, is required to be funded through a trust or other funding vehicle and which is governed by the laws of a jurisdiction outside the United States.
“ Foreign Subsidiary ” means any Subsidiary which is not a Domestic Subsidiary.
 
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“ Funding Account ” has the meaning assigned to such term in Section 5.01(h).
“ GAAP ” means generally accepted accounting principles in the U.S. set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the U.S., that are applicable to the circumstances as of the date of determination, consistently applied.
“ Governmental Authority ” means the government of the U.S., any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
“ Hazardous Materials ” means: (a) any substance, material, or waste that is included within the definitions of “hazardous substances,” “hazardous materials,” “hazardous waste,” “toxic substances,” “toxic materials,” “toxic waste,” or words of similar import in any Environmental Law; (b) those substances listed as hazardous substances by the United States Department of Transportation (or any successor agency) (49 C.F.R. 172.101 and amendments thereto) or by the Environmental Protection Agency (or any successor agency) (40 C.F.R. Part 302 and amendments thereto); and (c) any substance, material, or waste that is petroleum, or a petroleum by-product, friable asbestos, polychlorinated biphenyls, radioactive or freon gas.
“ HD Supply Acquisition ” means the purchase by Anixter of the outstanding Equity Interests of each of HDS PS, HDS Power Solutions, Inc., and Pro Canadian Holdings I, ULC, a Nova Scotia unlimited liability company (“ Pro Canadian ” and, together with HDS PS and HDS Power Solutions, each, a “ Target ”), and certain assets used in or held for use in the power solutions business of the Targets but owned by one or more affiliates of the Targets (which assets are the “Purchased Assets” under and as defined in the HD Supply Acquisition Agreement).
“ HD Supply Acquisition Agreement ” means the Purchase Agreement dated as of July 15, 2015, by and among the HD Supply Sellers, and Anixter, as buyer.
“ HD Supply Acquisition Agreement Representations ” means those representations and warranties made by any of the sellers and their Subsidiaries in the HD Supply Acquisition Agreement, to the extent Anixter has a right under the HD Supply Acquisition Agreement (a) not to consummate the transactions contemplated by the HD Supply Acquisition Agreement or (b) to terminate Anixter’s obligations under the HD Supply Acquisition Agreement, in each case, as a result of a breach of such representation or warranty made by any of the sellers and their Subsidiaries in the HD Supply Acquisition Agreement.
“ HD Supply Acquisition Documents ” means (a) the HD Supply Acquisition Agreement, and (b) all other agreements, instruments, documents, and certificates required to be executed and delivered as conditions precedent to the effectiveness of the HD Supply Acquisition Agreement or to the consummation of the HD Supply Acquisition.
“ HD Supply Sellers ” means HD Supply Holdings, LLC, HD Supply GP & Management, Inc., HD Supply Power Solutions Group, Inc. and BRAFASCO Holdings II, Inc.
“ HDS PS ” means HD Supply Power Solutions, Ltd., a Florida limited partnership. Substantially concurrently with the consummation of the HD Supply Acquisition, HDS PS will convert into a Florida limited liability company and change its name to “Anixter Power Solutions, LLC”.
 
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“ HDS Power Solutions ” means HDS Power Solutions, Inc., a Michigan corporation. Substantially concurrently with the consummation of the HD Supply Acquisition, HDS Power Solutions will change its name to “Anixter Power Solutions Inc.”.
“ Impacted Interest Period ” has the meaning assigned to such term in the definition of “LIBO Rate.”
“ Indebtedness ” means, as to any Person at a particular time, all of the following (without duplication):
(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;
(b) any direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), banker’s acceptances, bank guaranties, surety bonds and similar instruments;
(c) net obligations under any Swap Agreement in an amount equal to (i) if such Swap Agreement has been closed out, the termination value thereof, or (ii) if such Swap Agreement has not been closed out, the mark-to-market value thereof determined on the basis of readily available quotations provided by any recognized dealer in such Swap Agreement;
(d) whether or not so included as liabilities in accordance with GAAP, all obligations of such Person to pay the deferred purchase price of property or services, and indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;
(e) Capital Leases and Synthetic Lease Obligations;
(f) the outstanding aggregate investment or principal amount of claims held by purchasers, assignees or transferees of (or of interests in) receivables of such Person in connection with any Receivables Facility Transaction; and
(g) all Accommodation Obligations of such Person in respect of any of the foregoing.
For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person except for customary exceptions acceptable to the Required Lenders. The amount of any Capital Lease or Synthetic Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.
“ Indemnified Amounts ” has the meaning assigned to such term in Section 11.03(b).
“ Indemnified Taxes ” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by, or on account of any obligation of the Borrower under any Loan Document and (b) to the extent not otherwise described in the foregoing clause (a) hereof, Other Taxes.
“ Indemnitee ” has the meaning assigned to such term in Section 11.03(b).
 
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“ Independent Director ” means a director of the Board of Directors of the Borrower who: (a) shall not have been at the time of such Person’s appointment or at any time during the preceding five (5) years, and shall not be as long as such Person is a director of the Borrower (i) a director, officer, employee, partner, shareholder, member, manager or Affiliate of any of the following Persons (collectively, the “ Independent Parties ”): the Servicer, any Originator, or any of their respective Subsidiaries or Affiliates (other than the Borrower), (ii) a supplier to any of the Independent Parties, (iii) a Person controlling or under common control with any partner, shareholder, member, manager, Affiliate or supplier of any of the Independent Parties, or (iv) a member of the immediate family of any director, officer, employee, partner, shareholder, member, manager, Affiliate or supplier of any of the Independent Parties; (b) has prior experience as an independent director for a corporation or limited liability company whose charter documents required the unanimous consent of all independent directors thereof before such corporation or limited liability company could consent to the institution of bankruptcy or insolvency proceedings against it or could file a petition seeking relief under any applicable federal or state law relating to bankruptcy and (c) has at least three (3) years of employment experience with one or more entities that provide, in the ordinary course of their respective businesses, advisory, management or placement services to issuers of securitization or structured finance instruments, agreements or securities.
“ Independent Parties ” has the meaning assigned to such term in the definition of “Independent Director” in this Section 1.01.
“ Ineligible Institution ” has the meaning assigned to such term in Section 11.04(b).
“ Information ” has the meaning assigned to such term in Section 11.12.
“ Intercreditor Agreement ” means that certain Intercreditor Agreement dated as of the date hereof by and among Chase, as the Receivables Facility Administrative Agent, and Wells Fargo, as the Inventory Facility Administrative Agent, and acknowledged and agreed to by the Borrower and the Inventory Facility Loan Parties, in substantially the form of Exhibit G hereto, as the same may be amended or replaced from time to time.
“ Interest Election Request ” means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.08.
“ Interest Expense ” means, for any period, total interest expense (including that attributable to Capital Lease Obligations, Synthetic Lease Obligations and commitment fees) of the Consolidated Group for such period with respect to all outstanding Indebtedness of the Consolidated Group (including all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptances and net costs under Swap Agreements in respect of interest rates to the extent such net costs are allocable to such period in accordance with Agreement Accounting Principles), calculated on a consolidated basis for the Consolidated Group for such period in accordance with Agreement Accounting Principles.
“ Interest Payment Date ” means (a) with respect to any ABR Loan (other than a Swingline Loan), the first day of each calendar month and the Maturity Date, (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part (and, in the case of a Eurodollar Borrowing with an Interest Period of more than three (3) months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three (3) months’ duration after the first day of such Interest Period) and the Maturity Date.
 
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“ Interest Period ” means, with respect to any Eurodollar Borrowing, the period commencing on the date of such Eurodollar Borrowing and ending on the numerically corresponding day in the calendar month that is one (1), two (2), three (3) or six (6) months thereafter, as the Borrower may elect; provided , that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
“ Interpolated Rate ” means, at any time, for any Interest Period, the rate per annum (rounded to the same number of decimal places as the LIBO Screen Rate) determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the LIBO Screen Rate for the longest period (for which the LIBO Screen Rate is available) that is shorter than the Impacted Interest Period and (b) the LIBO Screen Rate for the shortest period (for which the LIBO Screen Rate is available) that exceeds the Impacted Interest Period, in each case, at such time.
“ Inventory ” means inventory (as that term is defined in the UCC).
“ Inventory Facility ” means that certain senior secured credit facility in an aggregate amount of up to $150,000,000 made in favor of Anixter and its affiliates, by Wells Fargo, as the administrative agent, the lenders from time to time party thereto and J.P. Morgan Securities LLC and Wells Fargo, as joint lead arrangers, made pursuant to the Inventory Facility Credit Agreement.
“ Inventory Facility Administrative Agent ” means Wells Fargo, in its capacity as the “Administrative Agent” under and as defined in the Inventory Facility Credit Agreement, and any successor to Wells Fargo, in that capacity.
“ Inventory Facility Availability ” means, at any time, “Availability” under and as defined in the Inventory Facility Credit Agreement.
“ Inventory Facility Commitment ” means, at any time, the Aggregate Revolver Commitments under and as defined in the Inventory Facility Credit Agreement.
“ Inventory Facility Credit Agreement ” means the Credit Agreement dated as of the date hereof, among Anixter, the Subsidiaries of Anixter party thereto, the Inventory Facility Administrative Agent, and the other financial institutions named therein, as the same may be amended or replaced from time to time.
“ Inventory Facility Guarantor ” means each “Guarantor” under and as defined in the Inventory Facility Credit Agreement.
“ Inventory Facility Loan Party ” means each “Loan Party” under and as defined in the Inventory Facility Credit Agreement.
“ Inventory Facility Secured Obligations ” means the “Secured Obligations” under and as defined in the Inventory Facility Credit Agreement.
 
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“ Investment ” has the meaning assigned to such term in Section 7.04(a).
“ IRS ” means the United States Internal Revenue Service.
“ Issuing Bank ” means, individually and collectively, each of Chase and Wells Fargo, each in its capacity as an issuer of Letters of Credit hereunder, and any other Revolving Lender from time to time designated by the Borrower as an Issuing Bank, with the consent of such Revolving Lender and the Administrative Agent, and their respective successors in such capacity as provided in Section 2.06(i). Any Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by its Affiliates, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate (it being agreed that such Issuing Bank shall, or shall cause such Affiliate to, comply with the requirements of Section 2.06 with respect to such Letters of Credit). At any time there is more than one Issuing Bank, all singular references to the Issuing Bank shall mean any Issuing Bank, either Issuing Bank, each Issuing Bank, the Issuing Bank that has issued the applicable Letter of Credit, or both (or all) Issuing Banks, as the context may require.
“ Issuing Bank Sublimit ” means, as of the Effective Date, $50,000,000, collectively, in the case of Chase and Wells Fargo, and such amount as shall be designated to the Administrative Agent and the Borrower in writing by an Issuing Bank; provided that any Issuing Bank shall be permitted at any time to increase or reduce its Issuing Bank Sublimit upon providing five (5) days’ prior written notice thereof to the Administrative Agent and the Borrower.
“ LC Collateral Account ” has the meaning assigned to such term in Section 2.06(j).
“ LC Disbursement ” means any payment made by an Issuing Bank pursuant to a Letter of Credit.
“ LC Exposure ” means, at any time, the sum of the Commercial LC Exposure and the Standby LC Exposure at such time. The LC Exposure of any Revolving Lender at any time shall be its Applicable Percentage of the aggregate LC Exposure at such time.
“ Lenders ” means the Persons listed on the Commitment Schedule and any other Person that shall have become a Lender hereunder pursuant to Section 2.09 or an Assignment and Assumption, other than any such Person that ceases to be a Lender hereunder pursuant to an Assignment and Assumption. Unless the context otherwise requires, the term “Lenders” includes the Swingline Lender and the Issuing Bank.
“ Letters of Credit ” means the letters of credit issued pursuant to this Agreement, and the term “ Letter of Credit ” means any one of them or each of them singularly, as the context may require.
“ LIBO Rate ” means, with respect to any Eurodollar Borrowing for any applicable Interest Period or for any ABR Borrowing, the London interbank offered rate as administered by ICE Benchmark Administration (or any other Person that takes over the administration of such rate for Dollars) for a period equal in length to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate (or, in the event such rate does not appear on a Reuters page or screen, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time as shall be selected by the Administrative Agent in its reasonable discretion; in each case the “ LIBO Screen Rate ”) at approximately 11:00 a.m., London time, two (2) Business Days prior to the commencement of such Interest Period; provided that, (x) if the LIBO Screen Rate shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement and (y) if the LIBO Screen Rate shall not be available at such time for a period equal in length to such Interest Period (an “ Impacted Interest Period ”), then the LIBO Rate shall be the Interpolated Rate at such time, subject to Section 2.14 in the event that the Administrative Agent shall
 
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conclude that it shall not be possible to determine such Interpolated Rate (which conclusion shall be conclusive and binding absent manifest error); provided further , that, if any Interpolated Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement. Notwithstanding the above, to the extent that “LIBO Rate” or “Adjusted LIBO Rate” is used in connection with an ABR Borrowing, such rate shall be determined as modified by the definition of Alternate Base Rate.
“ LIBO Screen Rate ” has the meaning assigned to such term in the definition of “LIBO Rate”.
“ Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), Environmental Lien, Enforceable Judgment, charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, the interest of a lessor under a Capital Lease, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of any financing statement under the Uniform Commercial Code or comparable laws of any jurisdiction), including the interest of a purchaser of accounts receivable.
“ Loan Documents ” means, collectively, this Agreement, any promissory notes issued pursuant to this Agreement, any Letter of Credit applications, the Collateral Documents, any Obligation Guaranty, the Intercreditor Agreement, the Fee Letter, the Borrower Subordination Agreement, each Collection Account Agreement, and all other agreements, instruments, documents and certificates identified in Section 4.01 executed and delivered by the Borrower, AXE or any member of the Consolidated Group to, or in favor of, the Administrative Agent or any Lender and including all other pledges, powers of attorney, consents, assignments, contracts, notices, letter of credit agreements and all other written matter whether heretofore, now or hereafter executed by or on behalf of the Borrower, or any employee of or Anixter, and delivered to the Administrative Agent or any Lender in connection with this Agreement or the transactions contemplated hereby. Any reference in this Agreement or any other Loan Document to a Loan Document shall include all appendices, exhibits or schedules thereto, and all amendments, restatements, supplements or other modifications thereto, and shall refer to this Agreement or such Loan Document as the same may be in effect at any and all times such reference becomes operative.
“ Loans ” means the loans and advances made by the Lenders pursuant to this Agreement, including Swingline Loans, Overadvances and Protective Advances.
“ Lock-Box ” means each locked postal box with respect to which a bank who has executed a Collection Account Agreement has been granted exclusive access for the purpose of retrieving and processing payments made on the Receivables and which is listed on Schedule C .
“ Material Accounting Changes ” has the meaning assigned to such term in the definition of “Agreement Accounting Principles” in this Section 1.01.
“ Material Adverse Effect ” means (a) a material adverse change in, or a material adverse effect upon, the operations, assets, liabilities (actual or contingent), business, properties, financial condition or prospects of AXE, Anixter and their Subsidiaries taken as a whole; (b) a material impairment of the ability of the Borrower to perform its obligations under any Loan Document to which it is a party; (c) a material impairment of the ability of the Inventory Facility Loan Parties (taken as a whole) to perform the obligations of all Inventory Facility Loan Parties under the Inventory Facility; (d) a material adverse effect upon the legality, validity, binding effect, or enforceability against the Borrower of any Loan Document to which it is a party or the rights and remedies of the Administrative Agent or the Lenders under the Loan Documents; (e) a material adverse effect on the Collateral, or the Administrative Agent’s Liens (on behalf of itself and the Lenders) on the Collateral or the priority of such Liens; (f) a material adverse change in, or a material adverse effect on the Administrative Agent’s Liens (on behalf of itself
 
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and the Lenders) on the Receivables generally or on any material portion of the Receivables or on the Related Security or Collections with respect thereto; or (g) a material adverse effect on the collectability of the Receivables generally or any material portion of the Receivables.
“ Material Indebtedness ” means (a) the Indebtedness under the Inventory Facility; (b) the Indebtedness in respect of Swap Agreements to the extent included as “Bank Product Obligations” under and as defined in the Inventory Facility Credit Agreement, (c) Indebtedness under the 2012 Notes Indenture, and (d) other Indebtedness (other than the Loans and Letters of Credit), or obligations in respect of one or more Swap Agreements, of any one or more of the Borrower, Anixter and its Subsidiaries in an aggregate principal amount exceeding $50,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower, Anixter or any Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that Anixter or such Subsidiary would be required to pay if such Swap Agreement were terminated at such time.
“ Material Transaction ” means any sale, assignment, transfer, conveyance or other disposition of (a) assets of any member of the Consolidated Group or (b) capital stock of any member of the Consolidated Group which, when combined with all such other sales, assignments, transfers, conveyances or other dispositions in the immediately preceding twelve (12) Fiscal Months represents the disposition of an amount which is greater than ten percent (10.0%) of the Consolidated Group’s (1) assets or (2) revenues.
“ Maturity Date ” means October 5, 2020 or any earlier date on which the Commitments are reduced to zero or otherwise terminated pursuant to the terms hereof.
“ Maximum Rate ” has the meaning assigned to such term in Section 11.17.
“ Moody’s ” means Moody’s Investors Service, Inc.
“ Multiemployer Plan ” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA which is, or within the immediately preceding six (6) years was, contributed to by Anixter or any ERISA Affiliate.
“ Net Worth ” means, as of any date, the excess, if any, of (a) the aggregate Outstanding Balance of the Receivables as of the last Business Day of the preceding Fiscal Month, over (b) the sum of (i) the Aggregate Revolving Exposure as of such date plus (ii) the aggregate outstanding principal balance of the Subordinated Loans as of such date (including any Subordinated Loan proposed to be made on such date).
“ Non-Consenting Lender ” has the meaning assigned to such term in Section 11.02(d).
“ Obligation Guaranty ” means any guarantee (including the AXE Guaranty) of all or any portion of the Secured Obligations executed and delivered to the Administrative Agent for the benefit of the Secured Parties by a guarantor who is not party to this Agreement.
“ Obligations ” means all unpaid principal of and accrued and unpaid interest on the Loans, all LC Exposure, all accrued and unpaid fees (including the fees provided for in the Fee Letter) and all expenses, reimbursements, indemnities and other obligations, liabilities and indebtedness (including expenses, interest and fees accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), of the Borrower and Anixter to any of the Lenders, the Administrative Agent, the Issuing Bank or any indemnified party, individually or collectively, existing on the Effective Date or arising thereafter, direct or indirect, joint or
 
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several, absolute or contingent, matured or unmatured, liquidated or unliquidated, secured or unsecured, arising by contract, operation of law or otherwise, arising or incurred under this Agreement or any of the other Loan Documents or in respect of any of the Loans made or reimbursement or other obligations incurred or any of the Letters of Credit or other instruments at any time evidencing any thereof.
“ Obligor ” means any Person obligated to make payments pursuant to a Contract.
“ OFAC ” means the Office of Foreign Assets Control of the United States Department of the Treasury.
“ Operating Lease ” means, as applied to any Person, any lease of any Property by that Person as lessee which is not a Capital Lease.
“ Organization Documents ” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-US jurisdiction), (b) with respect to any limited liability company, the certificate, memorandum and articles of association or articles of formation or organization and operating agreement, and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity, in each case as amended from time to time.
“ Originator ” means (i) Anixter, (ii) each Subsidiary Originator and (iii) any other Person approved in writing from time to time by the Administrative Agent, in each case in such Person’s capacity as a “Seller” party to the Receivables Sale Agreement or any Receivables Transfer Agreement. For the avoidance of doubt, a Person that ceases to be an “Originator” in accordance with the Receivables Sale Agreement shall cease to be an Originator for all purposes of the Loan Documents.
“ Other Connection Taxes ” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Taxes (other than a connection arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to, or enforced, any Loan Document, or sold or assigned an interest in any Loan, Letter of Credit or any Loan Document).
“ Other Taxes ” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 2.19).
“ Outstanding Balance ” means, with respect to any Receivable at any time, the then outstanding principal balance thereof.
“ Overadvance ” has the meaning assigned to such term in Section 2.05(b).
“ Parent ” means, with respect to any Lender, any Person as to which such Lender is, directly or indirectly, a subsidiary.
 
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“ Participant ” has the meaning assigned to such term in Section 11.04(c).
“ Participant Register ” has the meaning assigned to such term in Section 11.04(c).
“ Payment Conditions ” means, with respect to any proposed event that is subject to satisfaction of the Payment Conditions, that either (a) after giving effect to the proposed event as if it occurred on the first day of the Pro Forma Period, pro forma Combined Availability would be greater than 20% of the Combined Commitment at all times during the Pro Forma Period, or (b) after giving effect to the proposed event as if it occurred on the first day of the Pro Forma Period, (i) pro forma Combined Availability at all times during the Pro Forma Period would be greater than 15% of the Combined Commitment and (ii) the pro forma Consolidated Fixed Charge Coverage Ratio would be greater than 1.1 to 1.
“ PBGC ” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
“ Pension Plan ” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by Anixter or any ERISA Affiliate or to which Anixter or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer plan (as described in Section 4064(a) of ERISA) has made contributions at any time during the immediately preceding five plan years.
“ Perfection Certificate ” means a certificate in the form of Exhibit F to the Agreement.
“ Permit ” means any permit, approval, consent, authorization, license, variance, or permission required from a Governmental Authority under an applicable Requirement of Law.
“ Permitted Discretion ” means a determination made in good faith and in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment.
“ Permitted Encumbrances ” means:
(a) Customary Permitted Liens; and
(b) judgment Liens in respect of judgments that do not constitute an Amortization Event under clause (k) of Article IX.
provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness, except with respect to clause (b) above.
“ Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
“ Plan ” means an employee benefit plan defined in Section 3(3) of ERISA in respect of which either Anixter or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an “employer” as defined in Section 3(5) of ERISA.
“ Platform ” means Debt Domain, Intralinks, Syndtrak or a substantially similar electronic transmission system.
 
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“ Potential Amortization Event ” means any event or condition which constitutes an Amortization Event or which upon notice, lapse of time or both would, unless cured or waived, become an Amortization Event.
“ Prime Rate ” means the rate of interest per annum publicly announced from time to time by Chase as its prime rate in effect at its principal offices in New York City. Each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.
“ Pro Canadian ” has the meaning specified in the definition of “HD Supply Acquisition”.
“ Pro Forma Opening Statements ” has the meaning assigned to such term in Section 5.01(b).
“ Pro Forma Period ” means the period commencing thirty (30) days prior to the date an event is proposed by Anixter to occur.
“ Projections ” has the meaning assigned to such term in Section 5.01(f).
“ Property ” means with respect to any Person, any real or personal property, plant, building, facility, structure, equipment or unit, or other asset (tangible or intangible) owned, leased or operated by such Person.
“ Protective Advance ” has the meaning assigned to such term in Section 2.04.
“ Receivables ” means the indebtedness and other obligations owed to the Seller or any other Originator (before giving effect to any transfer or conveyance under the related Receivables Transfer Agreement or the Receivables Sale Agreement) or the Borrower (after giving effect to any transfer or conveyance under the related Receivables Transfer Agreement and the Receivables Sale Agreement), whether constituting an account, chattel paper, instrument or general intangible, arising in connection with the sale of goods or the rendering of services by an Originator and includes the obligation to pay any Finance Charges with respect thereto. All indebtedness and other rights and obligations arising from any one transaction, including indebtedness and other rights and obligations represented by an individual invoice, shall constitute a Receivable separate from a Receivable consisting of the indebtedness and other rights and obligations arising from any other transaction; provided , that any indebtedness, rights or obligations referred to in the preceding sentence shall be a Receivable regardless of whether the Obligor or Anixter treats such indebtedness, rights or obligations as a separate payment obligation.
“ Receivables Facility Transactions ” means any sale, assignment, or other transfer to the Borrower by Anixter or any Subsidiary of accounts receivable, lease receivables, or other payment obligations owing to Anixter or such Subsidiary or any interest in any of the foregoing, together in each case with any collections and other proceeds thereof, any collection or deposit accounts related thereto, and any collateral, guaranties or other property or claims in favor of Anixter or such Subsidiary supporting or securing payment by the obligor thereon of, or otherwise related to, any such receivables.
“ Receivables Facility Transaction Documents ” means the Receivable Sale Agreement, each Receivables Transfer Agreement, the Borrower Subordinated Documents and each of the other material agreements, instruments, and documents executed and delivered in connection with the Receivables Facility Transactions.
“ Receivables Sale Agreement ” means that certain Third Amended and Restated Receivables Sale Agreement, dated as of the date hereof, by and between Anixter, as seller, and the Borrower, as buyer, as the same may be amended, restated or otherwise modified from time to time.
 
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“ Receivables Transfer Agreement ” means (a) any Subsidiary Originator Transfer Agreement, and (b) any other receivables transfer agreement entered into from time to time by and between Anixter, as the Buyer, and any other Originator, as the Seller, in each case as the same may be amended, restated or otherwise modified from time to time.
“ Recipient ” means, as applicable, (a) the Administrative Agent, (b) any Lender and (c) any Issuing Bank, or any combination thereof (as the context requires).
“ Records ” means, with respect to any Receivable, all Contracts and other documents, books, records and other information (including computer programs, tapes, disks, punch cards, data processing software and related property and rights) relating to such Receivable, any Related Security therefor and the related Obligor.
“ Refinance Indebtedness ” has the meaning assigned to such term in Section 7.01(a)(xiii).
“ Register ” has the meaning assigned to such term in Section 10.04(b)(iv).
“ Regulation T, U, or X ” means Regulation T, U, or X, respectively, of the Board as from time to time in effect and any successor to all or a portion thereof.
“ Related Entity ” has the meaning assigned to such term in Section 6.19.
“ Related Parties ” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, partners, members, trustees, employees, agents, administrators, managers, representatives and advisors of such Person and such Person’s Affiliates.
“ Related Security ” means, with respect to any Receivable:
(a) all of the related Originator’s interest in the inventory and goods (including returned or repossessed inventory or goods), if any, the sale of which by such Originator gave rise to such Receivable, and all insurance contracts with respect thereto;
(b) all other security interests or liens and property subject thereto from time to time, if any, purporting to secure payment of such Receivable, whether pursuant to the related Contract or otherwise, together with all financing statements and security agreements describing any collateral securing such Receivable;
(c) all guaranties, letters of credit, insurance and other agreements or arrangements of whatever character from time to time supporting or securing payment of such Receivable whether pursuant to the related Contract or otherwise;
(d) all service contracts and other contracts and agreements associated with such Receivable;
(e) all Records related to such Receivable;
(f) all of the Seller’s right, title and interest in, to and under the related Receivables Transfer Agreement, if applicable; and
(g) all proceeds of any of the foregoing.
 
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When used in this Agreement, the term “Related Security” shall also include all right, title and interest of the Borrower in, to and under the Receivables Sale Agreement, and the proceeds of the foregoing.
“ Related Transactions ” means, collectively, (a) the Transactions, (b) the “Transactions” under and as defined in the Inventory Facility Credit Agreement, (c) the HD Supply Acquisition, and (d) the Receivables Facility Transactions.
“ Related Transactions Documents ” means, collectively, (a) the Loan Documents, (b) the Revolving Subordinated Note, (c) the “Loan Documents” under and as defined in the Inventory Facility Credit Agreement, (d) the Borrower Subordinated Documents, (e) the Receivables Sale Agreement, (f) the Receivables Transfer Agreements and (g) all other material agreements, instruments, and documents executed and delivered in connection with the Receivables Facility Transactions.
“ Release ” means any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, disposing or dumping into the environment.
“ Remedial Action ” means any action required by a Governmental Authority or an Environmental Law to (a) clean up, remove, treat or in any other way address Hazardous Materials; (b) prevent a Release or minimize the further Release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare or the environment; or (c) perform pre-remedial studies and investigations or post-remedial monitoring and care.
“ Report ” means reports prepared by the Administrative Agent or another Person showing the results of appraisals, field examinations or audits pertaining to the assets of the Borrower from information furnished by or on behalf of the Borrower, after the Administrative Agent has exercised its rights of inspection pursuant to this Agreement, which Reports shall be distributed to the Lenders by the Administrative Agent.
“ Reportable Event ” means any of the events set forth in Section 4043 of ERISA (other than an event for which the 30-day notice period is waived).
“ Required Lenders ” means, at any time, Lenders (other than Defaulting Lenders) having Credit Exposures and unused Commitments representing more than 50% of the sum of the Aggregate Credit Exposure and unused Commitments at such time, provided that at any time there are two (2) or more lenders, “Required Lenders” must include at least two (2) Lenders (who are not Affiliates of one another).
“ Requirement of Law ” means, as to any Person, the Organization Documents or other organizational or governing documents of such Person, and any law, rule or regulation (excluding Environmental Laws), Permit (excluding any Permit issued pursuant to an Environmental Law), or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its Property or to which such Person or any of its property is subject, including the Securities Act, the Securities Exchange Act, and Regulation T, U, or X, and any certificate of occupancy, zoning ordinance, building, or land use, law, rule, regulation, ordinance or Permit or occupational safety or health law, rule or regulation.
“ Reserves ” means any reserve which the Administrative Agent deems necessary, in its Permitted Discretion, to maintain (including an availability reserve, reserves for accrued and unpaid interest on the Secured Obligations, volatility reserves, a dilution reserve, reserves for contingent liabilities of the Borrower, reserves for uninsured losses of the Borrower, reserves for uninsured, underinsured, un-indemnified or under-indemnified liabilities or potential liabilities with respect to any litigation, reserves
 
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for taxes, fees, assessments, and other governmental charges and reserves with respect to amounts owing by the Borrower, Anixter or its Subsidiaries to any Person to the extent secured by a Lien on, or trust over, any of the Collateral (other than a Permitted Encumbrance), which Lien or trust, in the Permitted Discretion of the Administrative Agent, likely would have a priority superior to the Administrative Agent’s Liens (such as Liens or trusts in favor of landlords, warehousemen, carriers, mechanics, materialmen, laborers, or suppliers, or Liens or trusts for ad valorem, excise, sales or other taxes where given priority under applicable law and/or any potential priority Liens or trust claims under any applicable wage lien laws) with respect to the Collateral or the Borrower.
“ Restricted Payment ” means any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests in the Borrower or any option, warrant or other right to acquire any such Equity Interests in the Borrower.
“ Review ” has the meaning assigned to such term in Section 6.06.
“ Revolving Commitment ” means, with respect to each Lender, the commitment, if any, of such Lender to make Revolving Loans and to acquire participations in Letters of Credit, Overadvances and Swingline Loans hereunder, expressed as an amount representing the maximum aggregate permitted amount of such Lender’s Revolving Exposure hereunder, as such commitment may be reduced or increased from time to time pursuant to (a) Section 2.09 and (b) assignments by or to such Lender pursuant to Section 11.04. The initial amount of each Lender’s Revolving Commitment is set forth on the Commitment Schedule , or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Revolving Commitment, as applicable.
“ Revolving Exposure ” means, with respect to any Lender at any time, the sum of (a) the outstanding principal amount of such Lender’s Revolving Loans, its LC Exposure and its Swingline Exposure at such time, plus (b) an amount equal to its Applicable Percentage of the aggregate principal amount of Overadvances outstanding at such time.
“ Revolving Lender ” means, as of any date of determination, a Lender with a Revolving Commitment or, if the Revolving Commitments have terminated or expired, a Lender with Revolving Exposure.
“ Revolving Loan ” means a Loan made pursuant to Section 2.01.
“ Revolving Period ” means the period beginning on the date on which the first Loan is made or the first Letter of Credit is issued pursuant to this Agreement and ending on the Facility Termination Date.
“ Revolving Subordinated Note ” means the demand promissory note from Anixter to AXE dated October 6, 2000, as the same may be amended, modified or supplemented.
“ S&P ” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business.
“ Sale and Leaseback Transaction ” has the meaning assigned to such term in Section 7.06(a).
 
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“ Samuel Zell Group ” means Samuel Zell or any of his affiliates (as such term is defined in Rule 12b 2 of the Securities Exchange Act) or associates (as such term is defined in Rule 12b-2 of the Securities Exchange Act), and his heirs and beneficiaries.
“ Sanctioned Country ” means, at any time, a country or territory which is itself the subject or target of any Sanctions (at the time of this Agreement, Cuba, Iran, North Korea, Sudan and Syria).
“ Sanctioned Person ” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the OFAC or the U.S. Department of State or by the United Nations Security Council, the European Union or any European Union member state, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons described in the foregoing clauses (a) or (b).
“ Sanctions ” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the OFAC of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state or Her Majesty’s Treasury of the United Kingdom.
“ SEC ” means the Securities and Exchange Commission of the U.S.
“ Secured Debt ” has the meaning assigned to that term in the 2012 Notes Indenture.
“ Secured Debt-to-CTNA Ratio ” has the meaning assigned to such term in the Inventory Facility Credit Agreement.
“ Secured Obligations ” means all Obligations owing to one or more Lenders or their respective Affiliates.
“ Secured Parties ” means (a) the Administrative Agent, (b) the Lenders, (c) each Issuing Bank, (d) the beneficiaries of each indemnification obligation undertaken by the Borrower and Anixter under any Loan Document, and (e) the successors and assigns of each of the foregoing.
“ Securities Act ” means the Securities Act of 1933.
“ Securities Exchange Act ” means the Securities Exchange Act of 1934.
“ Security Agreement ” means that certain Security Agreement (including any and all supplements thereto), dated as of the date hereof, among the Borrower and the Administrative Agent, for the benefit of the Administrative Agent and the other Secured Parties, and any other security agreement entered into, after the date of this Agreement by the Borrower (as required by this Agreement or any other Loan Document) or any other Person for the benefit of the Administrative Agent and the other Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“ Seller ” means Anixter, in its capacity as seller under the Receivables Sale Agreement.
“ Servicer ” has the meaning assigned to such term in Section 8.01.
 
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“ Servicer Termination Event ” means the occurrence of any one or more of the following events:
(a) the Servicer shall fail to make any payment or deposit required to be paid to a Lender, the Administrative Agent or an Indemnitee under this Agreement or any other Loan Document to which it is a party;
(b) the Servicer shall fail to notify the Administrative Agent of any change or amendment to any Credit and Collection Policy which would reasonably be expected to adversely affect the collectability of the Receivables or decrease the credit quality of any newly created Receivables;
(c) the occurrence and continuation of a Material Adverse Effect with respect to the Servicer;
(d) the Servicer shall fail to perform or observe any covenant of the Servicer contained in Article VI or Article VII; or
(e) The Servicer shall fail to observe or perform any covenant, condition or agreement contained in this Agreement (other than as referred to in another paragraph of this Section)), and such failure shall continue unremedied for a period of fifteen (15) days after the earlier of the Servicer’s knowledge of such breach or notice thereof from the Administrative Agent (which notice will be given at the request of any Lender).
“ Servicing Fee ” has the meaning set forth in Section 8.05.
“ Settlement ” has the meaning assigned to such term in Section 2.05(d).
“ Settlement Date ” has the meaning assigned to such term in Section 2.05(d).
“ Solvent ” means, when used with respect to any Person, that at the time of determination: (a) the fair value of its assets (both at fair valuation and at present fair saleable value) is equal to or in excess of the total amount of its liabilities, including contingent liabilities; (b) it is then able and expected to be able to pay its debts as they mature; and (c) it has capital sufficient to carry on its business as conducted and as proposed to be conducted.
With respect to contingent liabilities (such as litigation, guarantees and pension plan liabilities), such liabilities shall be computed at the amount which, in light of all the facts and circumstances existing at the time, represent the amount which can reasonably be expected to become an actual or matured liability.
“ Specified Amortization Event ” means (a) any Amortization Event described in clause (a), (b), or (d) (with respect to any failure to observe or perform any covenant, condition, or agreement contained in Section 6.03 (with respect to the existence of the Borrower), Section 7.01, Section 7.02, Section 7.03(a), Section 7.04, Section 7.05, Section 7.11, Section 7.14 or Section 7.18), (h), (i) or (j) of Article IX, or (b) any Specified Event of Default under and as defined in the Inventory Facility Credit Agreement.
“ Specified Representations ” means the representations and warranties set forth in Section 4.01, Section 4.02, clauses (b) and (c) (with respect to Requirements of Law) of Section 4.03, Section 4.08, Section 4.13, Section 4.16 (as to perfection (insofar as perfection is achieved by the filing of UCC financing statements, intellectual property security agreements, or delivery of Equity Interest certificates and undated Equity Interest powers)), Section 4.18, Section 4.19, and Section 4.22.
 
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“ Specified Secured Debt ” means Secured Debt issued after April 30, 2012, other than Secured Debt permitted to be secured under subparagraphs (a) through (l), inclusive, of Section 1005 of the 2012 Notes Indenture.
“ Standby LC Exposure ” means, at any time, the sum of (a) the aggregate undrawn amount of all standby Letters of Credit outstanding at such time plus (b) the aggregate amount of all LC Disbursements relating to standby Letters of Credit that have not yet been reimbursed by or on behalf of the Borrower at such time. The Standby LC Exposure of any Revolving Lender at any time shall be its Applicable Percentage of the aggregate Standby LC Exposure at such time.
“ Statements ” has the meaning assigned to such term in Section 2.18(g).
“ Statutory Reserve Rate ” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentage (including any marginal, special, emergency or supplemental reserves) established by the Board to which the Administrative Agent is subject with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed pursuant to such Regulation D of the Board. Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D of the Board or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
“ Subordinated Indebtedness ” of a Person means any Indebtedness of such Person the payment of which is subordinated to payment of the Obligations to the written satisfaction of the Administrative Agent.
“ Subordinated Loans ” means the subordinated revolving loans made by the Seller to the Borrower from time to time pursuant to Section 2.03(b) of the Receivables Sale Agreement (which loans are evidenced by the Borrower Subordinated Note).
“ Subscription Agreement ” means that certain Amended and Restated Stockholder and Subscription Agreement dated as of the date hereof, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“ Subsidiary ” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless the context requires otherwise, “Subsidiary” means a Subsidiary of Anixter.
“ Subsidiary Originator ” means each Subsidiary of Anixter identified on Schedule D and any other Subsidiary of Anixter approved in writing from time to time by the Administrative Agent (evidenced by an amended or modified Schedule D) .
“ Subsidiary Originator Receivable ” means a Receivable originated by a Subsidiary Originator and sold by a Subsidiary Originator to Anixter pursuant to a Subsidiary Originator Transfer Agreement.
 
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“ Subsidiary Originator Transfer Agreement ” means any receivables transfer agreement entered into from time to time by and between Anixter, as the buyer, and any Subsidiary Originator, as the seller, in each case as the same may be amended, restated or otherwise modified from time to time.
“ Swap Agreement ” means any agreement with respect to any swap, forward, spot, future, credit default or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Borrower or the Subsidiaries shall be a Swap Agreement.
“ Swingline Exposure ” means, at any time, the aggregate principal amount of all Swingline Loans outstanding at such time. The Swingline Exposure of any Revolving Lender at any time shall be its Applicable Percentage of the total Swingline Exposure at such time.
“ Swingline Lender ” means Chase in its capacity as lender of Swingline Loans hereunder. Any consent required of the Administrative Agent or the Issuing Bank shall be deemed to be required of the Swingline Lender and any consent given by Chase in its capacity as Administrative Agent or Issuing Bank shall be deemed given by Chase in its capacity as Swingline Lender.
“ Swingline Loan ” has the meaning assigned to such term in Section 2.05(a).
“ Synthetic Lease Obligation ” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).
“ Target ” has the meaning assigned to such term in the definition of “HD Supply Acquisition”.
“ Taxes ” means any and all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
“ Termination Event ” means a (a) Reportable Event with respect to any Benefit Plan; (b) the withdrawal of Anixter or any ERISA Affiliate from a Benefit Plan during a plan year in which Anixter or such ERISA Affiliate was a “substantial employer” as defined in Section 4001(a)(2) of ERISA; (c) the imposition of an obligation of Anixter or any ERISA Affiliate under Section 4041 of ERISA to provide affected parties written notice of intent to terminate a Benefit Plan in a distress termination described in Section 4041(c) of ERISA; (d) the institution by the PBGC or any similar foreign governmental authority of proceedings to terminate a Benefit Plan or a Foreign Pension Plan, (e) any event or condition which might constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Benefit Plan; (f) a foreign governmental authority shall appoint or institute proceedings to appoint a trustee to administer any Foreign Pension Plan; or (g) the partial or complete withdrawal of Anixter of any ERISA Affiliate from a Multiemployer Plan or a Foreign Pension Plan.
“ Transactions ” means the execution, delivery and performance by the Borrower, and Anixter and its Subsidiaries, as applicable, of this Agreement and the other Loan Documents, the borrowing of Loans and other credit extensions, the use of the proceeds thereof and the issuance of Letters of Credit hereunder.
 
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“ Type ”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.
“ UCC ” means the Uniform Commercial Code as in effect from time to time in the State of Illinois or in any other state the laws of which are required to be applied in connection with the issue of perfection of security interests.
“ Unfinanced Capital Expenditures ” means, for any period, Capital Expenditures made during such period which are not financed from the proceeds of any Indebtedness (other than the Revolving Loans; it being understood and agreed that, to the extent any Capital Expenditures are financed with Revolving Loans, such Capital Expenditures shall be deemed Unfinanced Capital Expenditures).
“ Unliquidated Obligations ” means, at any time, any Secured Obligations (or portion thereof) that are contingent in nature or unliquidated at such time, including any Secured Obligation that is: (i) an obligation to reimburse a bank for drawings not yet made under a letter of credit issued by it; (ii) any other obligation (including any guarantee) that is contingent in nature at such time; or (iii) an obligation to provide collateral to secure any of the foregoing types of obligations.
“ U.S. ” means the United States of America.
“ USA PATRIOT Act ” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001.
“ U.S. Person ” means a “United States person” within the meaning of Section 7701(a)(30) of the Code.
“ U.S. Tax Compliance Certificate ” has the meaning assigned to such term in Section 2.17(f)(ii)(B)(3).
“ Wells Fargo ” means Wells Fargo Bank, National Association, a national banking association.
SECTION 1.02. Classification of Loans and Borrowings . For purposes of this Agreement, Loans may be classified and referred to by Class ( e.g. , a “Revolving Loan”) or by Type ( e.g. , a “Eurodollar Loan”) or by Class and Type ( e.g. , a “Eurodollar Revolving Loan”). Borrowings also may be classified and referred to by Class ( e.g. , a “Revolving Borrowing”) or by Type ( e.g. , a “Eurodollar Borrowing”) or by Class and Type ( e.g. , a “Eurodollar Revolving Borrowing”).
SECTION 1.03. Terms Generally . The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “law” shall be construed as referring to all statutes, rules, regulations, codes and other laws (including official rulings and interpretations thereunder having the force of law or with which affected Persons customarily comply) and all judgments, orders and decrees of all Governmental Authorities. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, restatements, supplements or modifications set forth herein), (b) any definition of or reference to any statute, rule or regulation shall be construed as referring thereto as from time to time amended,
 
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supplemented or otherwise modified (including by succession of comparable successor laws), (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns (subject to any restrictions on assignments set forth herein) and, in the case of any Governmental Authority, any other Governmental Authority that shall have succeeded to any or all functions thereof, (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (f) any reference in any definition to the phrase “at any time” or “for any period” shall refer to the same time or period for all calculations or determinations within such definition, and (g) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.
SECTION 1.04. Accounting Terms; GAAP . Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; In the event that historical accounting practices, systems or reserves relating to the components of the Borrowing Base are modified in a manner that is adverse to the Lenders in any material respect, the Borrower will agree to maintain such additional reserves (for purposes of computing the Borrowing Base) in respect of the components of the Borrowing Base and make such other adjustments (which may include maintaining additional reserves, modifying the advance rates or modifying the eligibility criteria for the components of the Borrowing Base). Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made (i) without giving effect to any election under Financial Accounting Standards Board Accounting Standards Codification 825-10-25 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of the Borrower at “fair value”, as defined therein and (ii) without giving effect to any treatment of Indebtedness in respect of convertible debt instruments under Financial Accounting Standards Board Accounting Standards Codification 470-20 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof and (iii) obligations relating to a lease that was accounted for by such Person as an operating lease as of the Effective Date shall be accounted for as obligations relating to an operating lease and not as obligations relating to a capital lease.
SECTION 1.05. Status of Obligations . In the event that the Borrower shall at any time issue or have outstanding any Subordinated Indebtedness, the Borrower shall take all such actions as shall be necessary to cause the Obligations to constitute senior indebtedness (however denominated) in respect of such Subordinated Indebtedness and to enable the Administrative Agent and the Lenders to have and exercise any payment blockage or other remedies available or potentially available to holders of senior indebtedness under the terms of such Subordinated Indebtedness. Without limiting the foregoing, the Secured Obligations are hereby designated as “senior indebtedness” and as “designated senior indebtedness” and words of similar import under and in respect of any indenture or other agreement or instrument under which such Subordinated Indebtedness is outstanding and are further given all such other designations as shall be required under the terms of any such Subordinated Indebtedness in order that the Lenders may have and exercise any payment blockage or other remedies available or potentially available to holders of senior indebtedness under the terms of such Subordinated Indebtedness.
 
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ARTICLE II
The Credits
SECTION 2.01. Commitments . Subject to the terms and conditions set forth herein, each Lender severally (and not jointly) agrees to make Revolving Loans to the Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in (a) such Lender’s Revolving Exposure exceeding such Lender’s Revolving Commitment or (b) the Aggregate Revolving Exposure exceeding the lesser of (i) the Aggregate Revolving Commitment and (ii) the Borrowing Base, subject to the Administrative Agent’s authority, in its sole discretion, to make Protective Advances and Overadvances pursuant to the terms of Section 2.04 and Section 2.05. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Revolving Loans.
SECTION 2.02. Loans and Borrowings .
(a) Each Loan (other than a Swingline Loan) shall be made as part of a Borrowing consisting of Loans of the same Class and Type made by the Lenders ratably in accordance with their respective Commitments of the applicable Class. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required. Any Protective Advance, any Overadvance and any Swingline Loan shall be made in accordance with the procedures set forth in Section 2.04 and Section 2.05.
(b) Subject to Section 2.14, each Revolving Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request in accordance herewith, provided that all Borrowings made on the Effective Date must be made as ABR Borrowings but may be converted into Eurodollar Borrowings in accordance with Section 2.08. Each Swingline Loan shall be an ABR Loan. Each Lender at its option may make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan (and in the case of an Affiliate, the provisions of Section 2.14, Section 2.15, Section 2.16 and Section 2.17 shall apply to such Affiliate to the same extent as to such Lender); provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of $100,000 and not less than $1,000,000. ABR Revolving Borrowings may be in any amount. Borrowings of more than one Type and Class may be outstanding at the same time; provided that there shall not at any time be more than a total of eight (8) Eurodollar Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing as a Eurodollar Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.
SECTION 2.03. Requests for Revolving Borrowings . To request a Revolving Borrowing, the Borrower shall notify the Administrative Agent of such request either in writing (delivered by hand or facsimile) in a form approved by the Administrative Agent and signed by the Borrower or by telephone not later than (a) in the case of a Eurodollar Borrowing, noon, Chicago time, three (3) Business Days before the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, noon, Chicago time, on the date of the proposed Borrowing; provided that any such notice of an ABR Revolving Borrowing to finance the reimbursement of an LC Disbursement as contemplated by Section 2.06(e) may be given not
 
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later than 9:00 a.m., Chicago time, on the date of such proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or facsimile to the Administrative Agent of a written Borrowing Request in a form approved by the Administrative Agent and signed by the Borrower. Each such telephonic and written Borrowing Request shall specify the following information in compliance with Section 2.02:
(i) the aggregate amount of the requested Revolving Borrowing and a breakdown of the separate wires comprising such Borrowing;
(ii) the date of such Revolving Borrowing, which shall be a Business Day;
(iii) whether such Revolving Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and
(iv) in the case of a Eurodollar Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period.”
If no election as to the Type of Revolving Borrowing is specified, then the requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period is specified with respect to any requested Eurodollar Revolving Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration. Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.
SECTION 2.04. Protective Advances .
(a) Subject to the limitations set forth below, the Administrative Agent is authorized by the Borrower and the Lenders, from time to time in the Administrative Agent’s sole discretion (but shall have absolutely no obligation to), to make Loans to the Borrower, on behalf of all Lenders, which the Administrative Agent, in its Permitted Discretion, deems necessary or desirable (i) to preserve or protect the Collateral, or any portion thereof, (ii) to enhance the likelihood of, or maximize the amount of, repayment of the Loans and other Obligations, or (iii) to pay any other amount chargeable to or required to be paid by the Borrower pursuant to the terms of this Agreement, including payments of reimbursable expenses (including costs, fees, and expenses as described in Section 11.03) and other sums payable under the Loan Documents (any of such Loans are herein referred to as “ Protective Advances ”); provided that, the aggregate amount of Protective Advances outstanding at any time shall not at any time exceed five percent (5%) of the amount of the Aggregate Revolving Commitment at such time; provided further that, the aggregate amount of outstanding Protective Advances plus the Aggregate Revolving Exposure shall not exceed the Aggregate Revolving Commitment. Protective Advances may be made even if the conditions precedent set forth in Section 4.02 have not been satisfied. The Protective Advances shall be secured by the Liens in favor of the Administrative Agent in and to the Collateral and shall constitute Obligations hereunder. All Protective Advances shall be ABR Borrowings. The Administrative Agent’s authorization to make Protective Advances may be revoked at any time by the Required Lenders. Any such revocation must be in writing and shall become effective prospectively upon the Administrative Agent’s receipt thereof. At any time that there is sufficient Availability and the conditions precedent set forth in Section 4.02 have been satisfied, the Administrative Agent may request the Revolving Lenders to make a Revolving Loan to repay a Protective Advance. At any other time the Administrative Agent may require the Lenders to fund their risk participations described in Section 2.04(b).
(b) Upon the making of a Protective Advance by the Administrative Agent (whether before or after the occurrence of a Potential Amortization Event), each Lender shall be deemed, without further
 
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action by any party hereto, to have unconditionally and irrevocably purchased from the Administrative Agent, without recourse or warranty, an undivided interest and participation in such Protective Advance in proportion to its Applicable Percentage. From and after the date, if any, on which any Lender is required to fund its participation in any Protective Advance purchased hereunder, the Administrative Agent shall promptly distribute to such Lender, such Lender’s Applicable Percentage of all payments of principal and interest and all proceeds of Collateral received by the Administrative Agent in respect of such Protective Advance.
SECTION 2.05. Swingline Loans and Overadvances.
(a) The Administrative Agent, the Swingline Lender and the Revolving Lenders agree that in order to facilitate the administration of this Agreement and the other Loan Documents, promptly after the Borrower requests an ABR Borrowing, the Swingline Lender may elect to have the terms of this clause (a) apply to such Borrowing Request by advancing, on behalf of the Revolving Lenders and in the amount requested, same day funds to the Borrower on the date of the applicable Borrowing to the Funding Account (each such Loan made solely by the Swingline Lender pursuant to Section 2.05(a) is referred to in this Agreement as a “ Swingline Loan ”), with settlement among them as to the Swingline Loans to take place on a periodic basis as set forth in Section 2.05(d). Each Swingline Loan shall be subject to all the terms and conditions applicable to other ABR Loans funded by the Revolving Lenders, except that all payments thereon shall be payable to the Swingline Lender solely for its own account. In addition, the Borrower hereby authorizes the Swingline Lender to, and the Swingline Lender may, subject to the terms and conditions set forth herein (but without any further written notice required), not later than 1:00 p.m., Chicago time, on each Business Day, make available to the Borrower by means of a credit to the Funding Account, the proceeds of a Swingline Loan; provided that, if on any Business Day there is insufficient borrowing capacity to permit the Swingline Lender to make available to the Borrower a Swingline Loan, then the Borrower shall be deemed to have requested an ABR Borrowing pursuant to Section 2.03 in the amount of such deficiency to be made on such Business Day. The aggregate amount of Swingline Loans outstanding at any time shall not exceed $30,000,000. The Swingline Lender shall not make any Swingline Loan if the requested Swingline Loan exceeds Availability (before or after giving effect to such Swingline Loan). All Swingline Loans shall be ABR Borrowings.
(b) Any provision of this Agreement to the contrary notwithstanding, at the request of the Borrower, the Administrative Agent may, in its sole discretion (but with absolutely no obligation), make Revolving Loans to the Borrower, on behalf of the Revolving Lenders, in amounts that exceed Availability (any such excess Revolving Loans are herein referred to collectively as “ Overadvances ”); provided that, no Overadvance shall result in a Potential Amortization Event due to Borrower’s failure to comply with Section 2.01 for so long as such Overadvance remains outstanding in accordance with the terms of this paragraph, but solely with respect to the amount of such Overadvance. In addition, Overadvances may be made even if the condition precedent set forth in Section 5.02(c) has not been satisfied. All Overadvances shall constitute ABR Borrowings. The authority of the Administrative Agent to make Overadvances is limited to an aggregate amount not to exceed five percent (5%) of the amount of the Aggregate Revolving Commitment at any time, no Overadvance may remain outstanding for more than thirty (30) days and no Overadvance shall cause any Revolving Lender’s Revolving Exposure to exceed its Revolving Commitment; provided that, the Required Lenders may at any time revoke the Administrative Agent’s authorization to make Overadvances. Any such revocation must be in writing and shall become effective prospectively upon the Administrative Agent’s receipt thereof.
(c) Upon the making of a Swingline Loan or an Overadvance (whether before or after the occurrence of a Potential Amortization Event and regardless of whether a Settlement has been requested with respect to such Swingline Loan or Overadvance), each Revolving Lender shall be deemed, without further action by any party hereto, to have unconditionally and irrevocably purchased from the Swingline
 
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Lender, without recourse or warranty, an undivided interest and participation in such Swingline Loan or Overadvance in proportion to its Applicable Percentage of the Revolving Commitment. The Swingline Lender may, at any time, require the Revolving Lenders to fund their participations. From and after the date, if any, on which any Revolving Lender is required to fund its participation in any Swingline Loan or Overadvance purchased hereunder, the Administrative Agent shall promptly distribute to such Lender, such Lender’s Applicable Percentage of all payments of principal and interest and all proceeds of Collateral received by the Administrative Agent in respect of such Swingline Loan or Overadvance.
(d) The Administrative Agent, on behalf of the Swingline Lender, shall request settlement (a “ Settlement ”) with the Revolving Lenders on at least a weekly basis or on any date that the Administrative Agent elects, by notifying the Revolving Lenders of such requested Settlement by facsimile, telephone, or e-mail no later than 12:00 noon Chicago time on the date of such requested Settlement (the “ Settlement Date ”). Each Revolving Lender (other than the Swingline Lender, in the case of the Swingline Loans) shall transfer the amount of such Revolving Lender’s Applicable Percentage of the outstanding principal amount of the applicable Loan with respect to which Settlement is requested to the Administrative Agent, to such account of the Administrative Agent as the Administrative Agent may designate, not later than 2:00 p.m., Chicago time, on such Settlement Date. Settlements may occur during the existence of a Potential Amortization Event and whether or not the applicable conditions precedent set forth in Section 4.02 have then been satisfied. Such amounts transferred to the Administrative Agent shall be applied against the amounts of the Swingline Lender’s Swingline Loans and, together with Swingline Lender’s Applicable Percentage of such Swingline Loan, shall constitute Revolving Loans of such Revolving Lenders, respectively. If any such amount is not transferred to the Administrative Agent by any Revolving Lender on such Settlement Date, the Swingline Lender shall be entitled to recover from such Lender on demand such amount, together with interest thereon, as specified in Section 2.07.
SECTION 2.06. Letters of Credit .
(a) General . Subject to the terms and conditions set forth herein, the Borrower may request the issuance of Letters of Credit as the applicant thereof for the support of its, Anixter’s and/or Anixter’s Subsidiaries’ obligations, in a form reasonably acceptable to the Administrative Agent and the Issuing Bank, at any time and from time to time during the Availability Period. In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Borrower to, or entered into by the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control. The Borrower unconditionally and irrevocably agrees that, in connection with any Letter of Credit issued to support the obligations of the Borrower, Anixter and/or any Subsidiary of Anixter, as provided in the first sentence of this paragraph, the Borrower will be fully responsible for the reimbursement of LC Disbursements in accordance with the terms hereof, the payment of interest thereon and the payment of fees due under Section 2.12(b) to the same extent as if it were the sole account party in respect of such Letter of Credit (the Borrower hereby irrevocably waiving any defenses that might otherwise be available to it as a guarantor or surety of the obligations of Anixter and/or its Subsidiaries that is an account party in respect of any such Letter of Credit). Notwithstanding anything herein to the contrary, the Issuing Bank shall have no obligation hereunder to issue, and shall not issue, any Letter of Credit (i) the proceeds of which would be made available to any Person (A) to fund any activity or business of or with any Sanctioned Person, or in any country or territory that, at the time of such funding, is the subject of any Sanctions or (B) in any manner that would result in a violation of any Sanctions by any party to this Agreement, (ii) if any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the Issuing Bank from issuing such Letter of Credit, or any Requirement of Law relating to the Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the Issuing Bank shall prohibit, or request that the Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of
 
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Credit in particular or shall impose upon the Issuing Bank with respect to such Letter of Credit any restriction, reserve or capital requirement (for which the Issuing Bank is not otherwise compensated hereunder) not in effect on the Effective Date, or shall impose upon the Issuing Bank any unreimbursed loss, cost or expense which was not applicable on the Effective Date and which the Issuing Bank in good faith deems material to it, or (iii) if the issuance of such Letter of Credit would violate one or more policies of the Issuing Bank applicable to letters of credit generally; provided that, notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements or directives thereunder or issued in connection therewith or in the implementation thereof, and (y) all requests, rules, guidelines, requirements or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed not to be in effect on the Effective Date for purposes of clause (ii) above, regardless of the date enacted, adopted, issued or implemented.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions . To request the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter of Credit), the Borrower shall deliver by hand or facsimile (or transmit by electronic communication, if arrangements for doing so have been approved by the Issuing Bank) to the Issuing Bank and the Administrative Agent prior to 9:00 am, Chicago time, at least three Business Days prior to the requested date of issuance, amendment, renewal or extension) a notice requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the amount of such Letter of Credit, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or extend such Letter of Credit. If requested by the Issuing Bank, the Borrower also shall submit a letter of credit application on the Issuing Bank’s standard form in connection with any request for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or extended only if (and upon issuance, amendment, renewal or extension of each Letter of Credit the Borrower shall be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or extension (i) the aggregate LC Exposure shall not exceed $50,000,000, (ii) no Revolving Lender’s Revolving Exposure shall exceed its Revolving Commitment and (iii) the Aggregate Revolving Exposure shall not exceed the lesser of the Aggregate Revolving Commitment and the Borrowing Base. Notwithstanding the foregoing or anything to the contrary contained herein, no Issuing Bank shall be obligated to issue or modify any Letter of Credit if, immediately after giving effect thereto, the outstanding LC Exposure in respect of all Letters of Credit issued by such Person and its Affiliates would exceed such Issuing Bank’s Issuing Bank Sublimit. Without limiting the foregoing and without affecting the limitations contained herein, it is understood and agreed that the Borrower may from time to time request that an Issuing Bank issue Letters of Credit in excess of its individual Issuing Bank Sublimit in effect at the time of such request, and each Issuing Bank agrees to consider any such request in good faith. Any Letter of Credit so issued by an Issuing Bank in excess of its individual Issuing Bank Sublimit then in effect shall nonetheless constitute a Letter of Credit for all purposes of this Agreement, and shall not affect the Issuing Bank Sublimit of any other Issuing Bank, subject to the limitations on the aggregate LC Exposure set forth in clause (i) of this Section 2.06(b).
(c) Expiration Date . Each Letter of Credit shall expire (or be subject to termination or non-renewal by notice from the Issuing Bank to the beneficiary thereof) at or prior to the close of business on the earlier of (i) the date one (1) year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, including any automatic renewal provision, one (1) year after such renewal or extension) and (ii) the date that is five (5) Business Days prior to the Maturity Date.
 
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(d) Participations . By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount thereof) and without any further action on the part of the Issuing Bank or the Revolving Lenders, the Issuing Bank hereby grants to each Revolving Lender, and each Revolving Lender hereby acquires from the Issuing Bank, a participation in such Letter of Credit equal to such Lender’s Applicable Percentage of the aggregate amount available to be drawn under such Letter of Credit. In consideration and in furtherance of the foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Lender’s Applicable Percentage of each LC Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section, or of any reimbursement payment required to be refunded to the Borrower for any reason. Each Revolving Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a Potential Amortization Event or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.
(e) Reimbursement . If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to the Administrative Agent an amount equal to such LC Disbursement (i) not later than 11:00 a.m., Chicago time, on the date that such LC Disbursement is made, if the Borrower shall have received notice of such LC Disbursement prior to 9:00 a.m., Chicago time, on such date, or, (ii) if such notice has not been received by the Borrower prior to such time on such date, then not later than 11:00 a.m., Chicago time, on (a) the Business Day that the Borrower receives such notice, if such notice is received prior to 9:00 a.m., Chicago time, on the day of receipt, or (b) the Business Day immediately following the day that the Borrower receives such notice, if such notice is not received prior to such time on the day of receipt; provided that the Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 or Section 2.05 that such payment be financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent amount and, to the extent so financed, the Borrower’s obligation to make such payment shall be discharged and replaced by the resulting ABR Revolving Borrowing or Swingline Loan. If the Borrower fails to make such payment when due, the Administrative Agent shall notify each Revolving Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Lender’s Applicable Percentage thereof. Promptly following receipt of such notice, each Revolving Lender shall pay to the Administrative Agent its Applicable Percentage of the payment then due from the Borrower, in the same manner as provided in Section 2.07 with respect to Loans made by such Lender (and Section 2.07 shall apply, mutatis mutandis , to the payment obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Issuing Bank the amounts so received by it from the Revolving Lenders. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to the Issuing Bank or, to the extent that Revolving Lenders have made payments pursuant to this paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing Bank, as their interests may appear. Any payment made by a Revolving Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the funding of ABR Revolving Loans or a Swingline Loan as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement.
(f) Obligations Absolute . The Borrower’s obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein or herein, (ii) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being
 
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untrue or inaccurate in any respect, (iii) any payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder. None of the Administrative Agent, the Revolving Lenders, or the Issuing Bank or any of their Related Parties shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided that the foregoing shall not be construed to excuse the Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to special, indirect, consequential or punitive damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower that are caused by the Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of the Issuing Bank (as finally determined by a court of competent jurisdiction), the Issuing Bank shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.
(g) Disbursement Procedures . The Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit. The Issuing Bank shall promptly notify the Administrative Agent and the Borrower by telephone (confirmed by facsimile) of such demand for payment and whether the Issuing Bank has made or will make an LC Disbursement thereunder; provided that any failure to give or delay in giving such notice shall not relieve the Borrower of its obligation to reimburse the Issuing Bank and the Revolving Lenders with respect to any such LC Disbursement.
(h) Interim Interest . If the Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the date such LC Disbursement is made to but excluding the date that the Borrower reimburses such LC Disbursement, at the rate per annum then applicable to ABR Revolving Loans and such interest shall be due and payable on the date when such reimbursement is payable; provided that, if the Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section, then Section 2.13(d) shall apply. Interest accrued pursuant to this paragraph shall be for the account of the Issuing Bank, except that interest accrued on and after the date of payment by any Revolving Lender pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be for the account of such Lender to the extent of such payment.
(i) Replacement of the Issuing Bank . The Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent shall notify the Revolving Lenders of any such replacement of the Issuing Bank. At the time any such replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.12(b).
 
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From and after the effective date of any such replacement, (i) the successor Issuing Bank shall have all the rights and obligations of the Issuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require. After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit then outstanding and issued by it prior to such replacement, but shall not be required to issue additional Letters of Credit.
(j) Cash Collateralization . If any Amortization Event shall occur and be continuing, on the Business Day that the Borrower receives notice from the Administrative Agent or the Required Lenders (or, if the maturity of the Loans is amortizing, Revolving Lenders with LC Exposure representing greater than fifty percent (50%) of the aggregate LC Exposure) demanding the deposit of cash collateral pursuant to this paragraph, the Borrower shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the Revolving Lenders (the “ LC Collateral Account ”), an amount in cash equal to one hundred three percent (103%) of the amount of the LC Exposure as of such date plus accrued and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Amortization Event with respect to the Borrower described in clause (h), (i) or (j) of Article IX. Such deposit shall be held by the Administrative Agent as collateral for the payment and performance of the Secured Obligations. The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over the LC Collateral Account and the Borrower hereby grants the Administrative Agent a security interest in the LC Collateral Account and all money or other assets on deposit therein or credited thereto. Other than any interest earned on the investment of such deposits, which investments shall be made at the option and sole discretion of the Administrative Agent and at the Borrower’s risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in the LC Collateral Account. Moneys in the LC Collateral Account shall be applied by the Administrative Agent to reimburse the Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of Revolving Lenders with LC Exposure representing greater than fifty percent (50%) of the aggregate LC Exposure), be applied to satisfy other Secured Obligations. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Amortization Event, such amount (to the extent not applied as aforesaid) shall be returned to the Borrower within three (3) Business Days after all such Amortization Events have been cured or waived as confirmed in writing by the Administrative Agent.
(k) Issuing Bank Reports to the Administrative Agent . Unless otherwise agreed by the Administrative Agent, each Issuing Bank shall, in addition to its notification obligations set forth elsewhere in this Section, report in writing to the Administrative Agent (i) periodic activity (for such period or recurrent periods as shall be requested by the Administrative Agent) in respect of Letters of Credit issued by such Issuing Bank, including all issuances, extensions, amendments and renewals, all expirations and cancelations and all disbursements and reimbursements, (ii) reasonably prior to the time that such Issuing Bank issues, amends, renews or extends any Letter of Credit, the date of such issuance, amendment, renewal or extension, and the stated amount of the Letters of Credit issued, amended, renewed or extended by it and outstanding after giving effect to such issuance, amendment, renewal or extension (and whether the amounts thereof shall have changed), (iii) on each Business Day on which such Issuing Bank makes any LC Disbursement, the date and amount of such LC Disbursement, (iv) on any Business Day on which the Borrower fails to reimburse an LC Disbursement required to be reimbursed to such Issuing Bank on such day, the date of such failure and the amount of such LC Disbursement, and (v) on any other Business Day, such other information as the Administrative Agent shall reasonably request as to the Letters of Credit issued by such Issuing Bank.
 
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(l) LC Exposure Determination . For all purposes of this Agreement, the amount of a Letter of Credit that, by its terms or the terms of any document related thereto, provides for one or more automatic increases in the stated amount thereof shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at the time of determination.
SECTION 2.07. Funding of Borrowings .
(a) Each Lender shall make each Loan to be made by such Lender hereunder on the proposed date thereof by wire transfer of immediately available funds by 2:00 p.m., Chicago time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders in an amount equal to such Lender’s Applicable Percentage; provided that, Swingline Loans shall be made as provided in Section 2.05. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to the Funding Account; provided that ABR Revolving Loans made to finance the reimbursement of (i) an LC Disbursement as provided in Section 2.06(e) shall be remitted by the Administrative Agent to the Issuing Bank and (ii) a Protective Advance or an Overadvance shall be retained by the Administrative Agent.
(b) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest rate applicable to ABR Loans. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing.
SECTION 2.08. Interest Elections .
(a) Each Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing. This Section shall not apply to Swingline Borrowings, Overadvances or Protective Advances, which may not be converted or continued.
(b) To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Borrowing of the Type resulting from such
 
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election to be made on the effective date of such election. Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery or facsimile to the Administrative Agent of a written Interest Election Request in a form approved by the Administrative Agent and signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.
If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.
(d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if a Potential Amortization Event has occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as a Potential Amortization Event is continuing (i) no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.
SECTION 2.09. Termination and Reduction of Commitments; Increase in Revolving Commitments .
(a) Unless previously terminated, the Revolving Commitments shall terminate on the Maturity Date.
(b) The Borrower may at any time terminate the Revolving Commitments upon (i) the payment in full of all outstanding Revolving Loans, together with accrued and unpaid interest thereon and on any Letters of Credit, (ii) the cancellation and return of all outstanding Letters of Credit (or alternatively, with respect to each such Letter of Credit, the furnishing to the Administrative Agent of a cash deposit (or at the discretion of the Administrative Agent a back-up standby letter of credit satisfactory to the Administrative Agent and the Issuing Bank) in an amount equal to 103% of the LC Exposure as of such date), (iii) the payment in full of the accrued and unpaid fees, and (iv) the payment in full of all reimbursable expenses and other Obligations, together with accrued and unpaid interest thereon.
 
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(c) The Borrower may from time to time reduce the Revolving Commitments; provided that (i) each reduction of the Revolving Commitments shall be in an amount that is an integral multiple of $50,000,000 and not less than $50,000,000 and (ii) the Borrower shall not terminate or reduce the Revolving Commitments if, after giving effect to any concurrent prepayment of the Revolving Loans in accordance with Section 2.11, the Aggregate Revolving Exposure would exceed the lesser of the Aggregate Revolving Commitment and the Borrowing Base.
(d) The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Revolving Commitments under paragraph (b) or (c) of this Section at least three (3) Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section shall be irrevocable; provided that a notice of termination of the Revolving Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. Any termination or reduction of the Revolving Commitments shall be permanent. Each reduction of the Revolving Commitments shall be made ratably among the Lenders in accordance with their respective Revolving Commitments.
(e) The Borrower shall have the right to increase the Revolving Commitments by obtaining additional Revolving Commitments, either from one or more of the Lenders or another lending institution provided that (i) any such request for an increase shall be in a minimum amount of $50,000,000, (ii) the Borrower may make a maximum of three (3) such requests, (iii) after giving effect thereto, the sum of the total of the additional Revolving Commitments does not exceed $200,000,000 and the Aggregate Revolving Commitment, after giving effect to all such additional Revolving Commitments, does not exceed $800,000,000, (iv) the Administrative Agent and the Issuing Bank have approved the identity of any such new Lender, such approvals not to be unreasonably withheld, (v) any such new Lender assumes all of the rights and obligations of a “Lender” hereunder, and (vi) the procedure described in Section 2.09(f) have been satisfied. Nothing contained in this Section 2.09 shall constitute, or otherwise be deemed to be, a commitment on the part of any Lender to increase its Commitment hereunder at any time.
(f) Any amendment hereto for such an increase or addition shall be in form and substance satisfactory to the Administrative Agent and shall only require the written signatures of the Administrative Agent, the Borrower and each Lender being added or increasing its Commitment, subject only to the approval of all Lenders if any such increase or addition would cause the Revolving Commitments to exceed $800,000,000. As a condition precedent to such an increase or addition, the Borrower shall deliver to the Administrative Agent (i) a certificate of the Borrower signed by an authorized officer of the Borrower (A) certifying and attaching the resolutions adopted by the Borrower approving or consenting to such increase, and (B) certifying that, before and after giving effect to such increase or addition, (1) the representations and warranties contained in Article IV and the other Loan Documents are true and correct in all material respects (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects only as of such specified date, and that any representation or warranty which is subject to any materiality qualifier shall be required to be true and correct in all respects), and (2) no Potential Amortization Event exists and (3) the Borrower and Anixter are in compliance (on a pro forma basis) with the applicable covenants contained in Section 7.14 and (ii) legal opinions and documents consistent with those delivered on the Effective Date, to the extent requested by the Administrative Agent.
 
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(g) On the effective date of any such increase or addition, (i) any Lender increasing (or, in the case of any newly added Lender, extending) its Revolving Commitment shall make available to the Administrative Agent such amounts in immediately available funds as the Administrative Agent shall determine, for the benefit of the other Lenders, as being required in order to cause, after giving effect to such increase or addition and the use of such amounts to make payments to such other Lenders, each Lender’s portion of the outstanding Revolving Loans of all the Lenders to equal its revised Applicable Percentage of such outstanding Revolving Loans, and the Administrative Agent shall make such other adjustments among the Lenders with respect to the Revolving Loans then outstanding and amounts of principal, interest, commitment fees and other amounts paid or payable with respect thereto as shall be necessary, in the opinion of the Administrative Agent, in order to effect such reallocation and (ii) the Borrower shall be deemed to have repaid and reborrowed all outstanding Revolving Loans as of the date of any increase (or addition) in the Revolving Commitments (with such reborrowing to consist of the Types of Revolving Loans, with related Interest Periods if applicable, specified in a notice delivered by the Borrower, in accordance with the requirements of Section 2.03). The deemed payments made pursuant to clause (ii) of the immediately preceding sentence shall be accompanied by payment of all accrued interest on the amount prepaid and, in respect of each Eurodollar Loan, shall be subject to indemnification by the Borrower pursuant to the provisions of Section 2.16 if the deemed payment occurs other than on the last day of the related Interest Periods. Within a reasonable time after the effective date of any increase or addition, the Administrative Agent shall, and is hereby authorized and directed to, revise the Commitment Schedule to reflect such increase or addition and shall distribute such revised Commitment Schedule to each of the Lenders and the Borrower, whereupon such revised Commitment Schedule shall replace the old Commitment Schedule and become part of this Agreement.
SECTION 2.10. Repayment and Amortization of Loans; Evidence of Debt .
(a) The Borrower hereby unconditionally promises to pay (i) to the Administrative Agent for the account of each Revolving Lender the then unpaid principal amount of each Revolving Loan on the Maturity Date, (ii) to the Administrative Agent the then unpaid amount of each Protective Advance on the earlier of the Maturity Date and demand by the Administrative Agent, and (iii) to the Administrative Agent the then unpaid principal amount of each Overadvance on the earlier of the Maturity Date and demand by the Administrative Agent.
(b) During a Cash Dominion Trigger Period, the Administrative Agent shall apply all funds credited to the Collection Account on such Business Day or the immediately preceding Business Day (at the discretion of the Administrative Agent, whether or not immediately available) first to prepay any Protective Advances and Overadvances that may be outstanding, pro rata, and second to prepay the Revolving Loans (including Swingline Loans) and to cash collateralize outstanding LC Exposure.
(c) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the Indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.
(d) The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Class and Type thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.
(e) The entries made in the accounts maintained pursuant to paragraph (c) or (d) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein;
 
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provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.
(f) Any Lender may request that Loans made by it be evidenced by a promissory note. In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a form approved by the Administrative Agent. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 11.04) be represented by one or more promissory notes in such form payable to the order of the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).
SECTION 2.11. Prepayment of Loans .
(a) The Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, subject to prior notice in accordance with paragraph (b) of this Section and, if applicable, payment of any break funding expenses under Section 2.16.
(b) Except for Overadvances permitted under Section 2.05, in the event and on such occasion that the Aggregate Revolving Exposure exceeds the lesser of (i) the Aggregate Revolving Commitment and (ii) the Borrowing Base, the Borrower shall prepay the Revolving Loans, LC Exposure and/or Swingline Loans or cash collateralize the LC Exposure in an account with the Administrative Agent pursuant to Section 2.06(j), as applicable in an aggregate amount equal to such excess (in the case of clause (ii) within one (1) Business Day of the Borrower’s knowledge thereof).
(c) The Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swingline Loan, the Swingline Lender) by telephone (confirmed by facsimile) of any prepayment hereunder not later than (i) 10:00 a.m., Chicago time, (A) in the case of prepayment of a Eurodollar Revolving Borrowing, three (3) Business Days before the date of prepayment unless a shorter period is otherwise required herein, or (B) in the case of prepayment of an ABR Revolving Borrowing, on the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid; provided that, if a notice of prepayment is given in connection with a conditional notice of termination of the Revolving Commitments as contemplated by Section 2.09, then such notice of prepayment may be revoked if such notice of termination is revoked in accordance with Section 2.09. Promptly following receipt of any such notice relating to a Revolving Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Revolving Borrowing shall be in an amount that would be permitted in the case of an advance of a Revolving Borrowing of the same Type as provided in Section 2.02. Each prepayment of a Revolving Borrowing shall be applied ratably to the Revolving Loans included in the prepaid Borrowing. Prepayments shall be accompanied by (i) accrued interest to the extent required by Section 2.13 and (ii) break funding payments pursuant to Section 2.16.
SECTION 2.12. Fees .
(a) The Borrower agrees to pay to the Administrative Agent for the account of each Lender a commitment fee, which shall accrue at the Applicable Commitment Fee Percentage on the average daily amount of the Available Revolving Commitment of such Lender during the period from and including the Effective Date to but excluding the date on which the Revolving Commitments terminate. Accrued commitment fees shall be payable in arrears on the first day of each calendar month and on the date on which the Revolving Commitments terminate, commencing on the first such date to occur after the date hereof. All commitment fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).
 
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(b) The Borrower agrees to pay (i) to the Administrative Agent for the account of each Revolving Lender a participation fee with respect to its participations in Letters of Credit, which shall accrue at the same Applicable Rate used to determine the interest rate applicable to Eurodollar Revolving Loans on the average daily amount of such Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including the Effective Date to but excluding the later of the date on which such Lender’s Revolving Commitment terminates and the date on which such Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting fee, which shall accrue at the rate of 0.125% per annum on the average daily amount of the LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) attributable to Letters of Credit issued by the Issuing Bank during the period from and including the Effective Date to but excluding the later of the date of termination of the Revolving Commitments and the date on which there ceases to be any LC Exposure, as well as the Issuing Bank’s standard fees and commissions with respect to the issuance, amendment, cancellation, negotiation, transfer, presentment, renewal or extension of any Letter of Credit or processing of drawings thereunder. Participation fees and fronting fees accrued through and including the last day of each calendar month shall be payable on the first day of each calendar month following such last day, commencing on the first such date to occur after the Effective Date; provided that all such fees shall be payable on the date on which the Revolving Commitments terminate and any such fees accruing after the date on which the Revolving Commitments terminate shall be payable on demand. Any other fees payable to the Issuing Bank pursuant to this paragraph shall be payable within ten (10) days after demand. All participation fees and fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).
(c) The Borrower agrees to pay to the Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreed upon between the Borrower and the Administrative Agent (including those fees set forth in the Fee Letter).
(d) All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent (or to an Issuing Bank, in the case of fees payable to it) for distribution, in the case of commitment fees and participation fees, to the Lenders. Fees paid shall not be refundable under any circumstances.
SECTION 2.13. Interest .
(a) The Loans comprising each ABR Borrowing (including each Swingline Loan) shall bear interest at the Alternate Base Rate plus the Applicable Rate, the sum of which shall in no event be less than 0% per annum.
(b) The Loans comprising each Eurodollar Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate, the sum of which shall in no event be less than 0% per annum.
(c) Each Protective Advance and each Overadvance shall bear interest at the Alternate Base Rate plus the Applicable Rate for ABR Loans plus 2%.
(d) Notwithstanding the foregoing, during the occurrence and continuance of an Amortization Event, the Administrative Agent or the Required Lenders may, at their option, by notice to the Borrower (which notice may be revoked at the option of the Required Lenders notwithstanding any
 
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provision of Section 11.02 requiring the consent of “each Lender affected thereby” for reductions in interest rates), declare that (i) all Loans shall bear interest at 2% plus the rate otherwise applicable to such Loans as provided in the preceding paragraphs of this Section or (ii) in the case of any other amount outstanding hereunder, such amount shall accrue at 2% plus the rate applicable to such fee or other obligation as provided hereunder.
(e) Accrued interest on each Loan (for ABR Loans, accrued through the last day of the prior calendar month) shall be payable in arrears on each Interest Payment Date for such Loan and upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (d) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving Loan prior to the end of the Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.
(f) All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate Base Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.
SECTION 2.14. Alternate Rate of Interest . If prior to the commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that adequate and reasonable means do not exist for ascertaining (including by means of an Interpolated Rate) the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for the applicable Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by electronic communication as provided in Section 11.01 as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective and any such Eurodollar Borrowing shall be repaid on the last day of the then current Interest Period applicable thereto, and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR Borrowing.
SECTION 2.15. Increased Costs .
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit, liquidity or similar requirement (including any compulsory loan requirement, insurance charge or other assessment) against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate) or the Issuing Bank;
 
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(ii) impose on any Lender or the Issuing Bank or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or any Letter of Credit or participation therein; or
(iii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto;
and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, continuing, converting into or maintaining any Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender, the Issuing Bank or such other Recipient of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender, the Issuing Bank or such other Recipient hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender, the Issuing Bank or such other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender, the Issuing Bank or such other Recipient, as the case may be, for such additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on the capital of such Lender’s or the Issuing Bank’s holding company, if any, as a consequence of this Agreement, the Commitments of, or the Loans made by, or participations in Letters of Credit or Swingline Loans held by, such Lender, or the Letters of Credit issued by the Issuing Bank, to a level below that which such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or the Issuing Bank’s policies and the policies of such Lender’s or the Issuing Bank’s holding company with respect to capital adequacy and liquidity), then from time to time the Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s holding company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the amount or amounts necessary to compensate such Lender or the Issuing Bank or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender or the Issuing Bank, as the case may be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or the Issuing Bank’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender or the Issuing Bank pursuant to this Section for any increased costs or reductions incurred more than 270 days prior to the date that such Lender or the Issuing Bank, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or the Issuing Bank’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 270-day period referred to above shall be extended to include the period of retroactive effect thereof.
 
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SECTION 2.16. Break Funding Payments . In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Amortization Event or as a result of any prepayment pursuant to Section 2.11), (b) the conversion of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, or continue any Eurodollar Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.09(d) and is revoked in accordance therewith), or (d) the assignment of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.19 or Section 11.02(d), then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Eurodollar Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to such Eurodollar Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Eurodollar Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the eurodollar market. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.
SECTION 2.17. Withholding of Taxes; Gross-Up .
(a) Payments Free of Taxes . Any and all payments by or on account of any obligation of the Borrower under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable withholding agent) requires the deduction or withholding of any Tax from any such payment by a withholding agent, then the applicable withholding agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the Borrower shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 2.17) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.
(b) Payment of Other Taxes by the Borrower . The Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for, Other Taxes.
(c) Evidence of Payment . As soon as practicable after any payment of Taxes by the Borrower to a Governmental Authority pursuant to this Section 2.17, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
(d) Indemnification by the Borrower . The Borrower shall jointly and severally indemnify each Recipient, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment to such
 
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Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.
(e) Indemnification by the Lenders . Each Lender shall severally indemnify the Administrative Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the Borrower has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 11.04(c) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to such Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).
(f) Status of Lenders . (i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.17(f)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.
(ii) Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Person,
(A) any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;
(B) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this
 
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Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:
(1) in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
(2) in the case of a Foreign Lender claiming that its extension of credit will generate U.S. effectively connected income, executed originals of IRS Form W-8ECI;
(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit E-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “ U.S. Tax Compliance Certificate ”) and (y) executed originals of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable; or
(4) to the extent a Foreign Lender is not the Beneficial Owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, a U.S. Tax Compliance Certificate substantially in the form of Exhibit E-2 or Exhibit E-3, IRS Form W-9, and/or other certification documents from each Beneficial Owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit E-4 on behalf of each such direct and indirect partner;
(C) any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and
(D) if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations
 
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under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.
(g) Treatment of Certain Refunds . If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.17 (including by the payment of additional amounts pursuant to this Section 2.17), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 2.17 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (g) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (g), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (g) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts giving rise to such refund had never been paid. This paragraph (g) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
(h) Survival . Each party’s obligations under this Section 2.17 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.
(i) Defined Terms . For purposes of this Section 2.17, the term “applicable law” includes FATCA.
SECTION 2.18. Payments Generally; Allocation of Proceeds; Sharing of Set-offs .
(a) The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts payable under Section 2.15, Section 2.16 or Section 2.17, or otherwise) prior to 2:00 p.m., Chicago time, on the date when due, in immediately available funds, without set off or counterclaim. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at its offices at 10 South Dearborn Street, 22 nd Floor, Chicago, Illinois, except payments to be made directly to the Issuing Bank or Swingline Lender as expressly provided herein and except that payments pursuant to Section 2.15, Section 2.16, Section 2.17 and Section 11.03 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in dollars.
 
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(b) Any proceeds of Collateral received by the Administrative Agent (i) not constituting either (A) a specific payment of principal, interest, fees or other sum payable under the Loan Documents (which shall be applied as specified by the Borrower), (B) a mandatory prepayment (which shall be applied in accordance with Section 2.11) or (C) amounts to be applied from a Collection Account (which shall be applied in accordance with Section 2.10(b)) during a Cash Dominion Trigger Period or (ii) after an Amortization Event has occurred and is continuing and the Administrative Agent so elects or the Required Lenders so direct, shall be applied ratably first , to pay any fees, indemnities, or expense reimbursements including amounts then due to the Administrative Agent and the Issuing Bank from the Borrower, second , to pay any fees or expense reimbursements then due to the Lenders from the Borrower, third , to pay any Servicing Fee then due and payable, fourth , to pay interest due in respect of the Overadvances and Protective Advances, fifth , to pay the principal of the Overadvances and Protective Advances, sixth , to pay interest then due and payable on the Loans (other than the Overadvances and Protective Advances) ratably, seventh , to prepay principal on the Loans (other than the Overadvances and Protective Advances) and unreimbursed LC Disbursements, ratably, eighth , to pay an amount to the Administrative Agent equal to one hundred three percent (103%) of the Aggregate LC Exposure, to be held as cash collateral for such Obligations, and ninth , to the payment of any other Secured Obligation due to the Administrative Agent or any Lender by the Borrower. Notwithstanding anything to the contrary contained in this Agreement, unless so directed by the Borrower, or unless a Potential Amortization Event is in existence, neither the Administrative Agent nor any Lender shall apply any payment which it receives to any Eurodollar Loan of a Class, except (a) on the expiration date of the Interest Period applicable thereto or (b) in the event, and only to the extent, that there are no outstanding ABR Loans of the same Class and, in any such event, the Borrower shall pay the break funding payment required in accordance with Section 2.16. The Administrative Agent and the Lenders shall have the continuing and exclusive right to apply and reverse and reapply any and all such proceeds and payments to any portion of the Secured Obligations.
(c) At the election of the Administrative Agent, all payments of principal, interest, LC Disbursements, fees, premiums, reimbursable expenses (including all reimbursement for fees, costs and expenses pursuant to Section 11.03), and other sums payable under the Loan Documents, may be paid from the proceeds of Borrowings made hereunder whether made following a request by the Borrower pursuant to Section 2.03 or a deemed request as provided in this Section or may be deducted from any deposit account of the Borrower maintained with the Administrative Agent. The Borrower hereby irrevocably authorizes (i) the Administrative Agent to make a Borrowing for the purpose of paying each payment of principal, interest and fees as it becomes due hereunder or any other amount due under the Loan Documents and agrees that all such amounts charged shall constitute Loans (including Swingline Loans and Overadvances, but such a Borrowing may only constitute a Protective Advance if it is to reimburse costs, fees and expenses as described in Section 11.03) and that all such Borrowings shall be deemed to have been requested pursuant to Section 2.03, Section 2.04 or Section 2.05, as applicable, and (ii) the Administrative Agent to charge any deposit account of the Borrower maintained with the Administrative Agent for each payment of principal, interest and fees as it becomes due hereunder or any other amount due under the Loan Documents.
(d) If, except as otherwise expressly provided herein, any Lender shall, by exercising any right of set off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans or participations in LC Disbursements resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Loans and participations in LC Disbursements and Swingline Loans and accrued interest thereon than the proportion received by any other similarly situated Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value)
 
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participations in the Loans and participations in LC Disbursements and Swingline Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by all such Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and participations in LC Disbursements and Swingline Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements or Swingline Loans to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.
(e) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.
(f) If any Lender shall fail to make any payment required to be made by it hereunder, then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), (i) apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender’s obligations hereunder until all such unsatisfied obligations are fully paid and/or (ii) hold any such amounts in a segregated account as cash collateral for, and application to, any future funding obligations of such Lender hereunder. Application of amounts pursuant to (i) and (ii) above shall be made in any order determined by the Administrative Agent in its discretion.
(g) The Administrative Agent may from time to time provide the Borrower with account statements or invoices with respect to any of the Secured Obligations (the “ Statements ”). The Administrative Agent is under no duty or obligation to provide Statements, which, if provided, will be solely for the Borrower’s convenience. Statements may contain estimates of the amounts owed during the relevant billing period, whether of principal, interest, fees or other Secured Obligations. If the Borrower pays the full amount indicated on a Statement on or before the due date indicated on such Statement, the Borrower shall not be in default of payment with respect to the billing period indicated on such Statement; provided, that acceptance by the Administrative Agent, on behalf of the Lenders, of any payment that is less than the total amount actually due at that time (including but not limited to any past due amounts) shall not constitute a waiver of the Administrative Agent’s or the Lenders’ right to receive payment in full at another time.
 
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SECTION 2.19. Mitigation Obligations; Replacement of Lenders .
(a) If any Lender requests compensation under Section 2.15, or if the Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.15 or Section 2.17, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.15, or if the Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17, or if any Lender becomes a Defaulting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 11.04), all its interests, rights (other than its existing rights to payments pursuant to Section 2.15 or Section 2.17) and obligations under this Agreement and other Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent (and in circumstances where its consent would be required under Section 11.04, the Issuing Bank and the Swingline Lender), which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts) and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.15 or payments required to be made pursuant to Section 2.17, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
SECTION 2.20. Defaulting Lenders . Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:
(a) fees shall cease to accrue on the unfunded portion of the Revolving Commitment of such Defaulting Lender pursuant to Section 2.12(a);
(b) such Defaulting Lender shall not have the right to vote on any issue on which voting is required (other than to the extent expressly provided in Section 11.02(b)) and the Commitment and Revolving Exposure of such Defaulting Lender shall not be included in determining whether the Required Lenders have taken or may take any action hereunder (including any consent to any amendment, waiver or other modification pursuant to Section 11.02) or under any other Loan Document; provided , that, except as otherwise provided in Section 11.02, this clause (b) shall not apply to the vote of a Defaulting Lender in the case of an amendment, waiver or other modification requiring the consent of such Lender or each Lender directly affected thereby;
 
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(c) if any Swingline Exposure or LC Exposure exists at the time such Lender becomes a Defaulting Lender then:
(i) all or any part of the Swingline Exposure and LC Exposure of such Defaulting Lender shall be reallocated among the non-Defaulting Lenders in accordance with their respective Applicable Percentages but only (x) to the extent that the conditions set forth in Section 4.02 are satisfied at the time of such reallocation (and, unless the Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented and warranted that such conditions are satisfied at such time) and (y) to the extent that such reallocation does not, as to any non-Defaulting Lender, cause such non-Defaulting Lender’s Revolving Exposure to exceed its Revolving Commitment;
(ii) if the reallocation described in clause (i) above cannot, or can only partially, be effected, the Borrower shall within one (1) Business Day following notice by the Administrative Agent (x)  first , prepay such Swingline Exposure and (y)  second , cash collateralize, for the benefit of the Issuing Bank, the Borrower’s obligations corresponding to such Defaulting Lender’s LC Exposure (after giving effect to any partial reallocation pursuant to clause (i) above) in accordance with the procedures set forth in Section 2.06(j) for so long as such LC Exposure is outstanding;
(iii) if the Borrower cash collateralizes any portion of such Defaulting Lender’s LC Exposure pursuant to clause (ii) above, the Borrower shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.12(b) with respect to such Defaulting Lender’s LC Exposure during the period such Defaulting Lender’s LC Exposure is cash collateralized;
(iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to clause (i) above, then the fees payable to the Lenders pursuant to Section 2.12(a) and Section 2.12(b) shall be adjusted in accordance with such non-Defaulting Lenders’ Applicable Percentages; and
(v) if all or any portion of such Defaulting Lender’s LC Exposure is neither reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then, without prejudice to any rights or remedies of the Issuing Bank or any other Lender hereunder, all letter of credit fees payable under Section 2.12(b) with respect to such Defaulting Lender’s LC Exposure shall be payable to the Issuing Bank until and to the extent that such LC Exposure is reallocated and/or cash collateralized; and
(d) so long as such Lender is a Defaulting Lender, the Issuing Bank shall not be required to issue, amend, renew, extend or increase any Letter of Credit, unless it is satisfied that the related exposure and such Defaulting Lender’s then outstanding LC Exposure will be 100% covered by the Commitments of the non-Defaulting Lenders and/or cash collateral will be provided by the Borrower in accordance with Section 2.20(c), and Swingline Exposure related to any such newly made Swingline Loan or LC Exposure related to any newly issued or increased Letter of Credit shall be allocated among non-Defaulting Lenders in a manner consistent with Section 2.20(c)(i) (and such Defaulting Lender shall not participate therein).
If (i) a Bankruptcy Event with respect to the Parent of any Lender shall occur following the date hereof and for so long as such event shall continue or (ii) the Issuing Bank has a good faith belief that any Lender has defaulted in fulfilling its obligations under one or more other agreements in which such Lender commits to extend credit, the Issuing Bank shall not be required to issue, amend or increase any Letter of Credit, unless the Issuing Bank shall have entered into arrangements with the Borrower or such Lender, satisfactory to the Issuing Bank to defease any risk to it in respect of such Lender hereunder.
 
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In the event that each of the Administrative Agent, the Borrower and the Issuing Bank agrees that a Defaulting Lender has adequately remedied all matters that caused such Lender to be a Defaulting Lender, then LC Exposure of the Lenders shall be readjusted to reflect the inclusion of such Lender’s Revolving Commitment and on the date of such readjustment such Lender shall purchase at par such of the Loans of the other Lenders (other than Swingline Loans) as the Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in accordance with its Applicable Percentage.
SECTION 2.21. Returned Payments . If after receipt of any payment which is applied to the payment of all or any part of the Obligations (including a payment effected through exercise of a right of setoff), the Administrative Agent or any Lender is for any reason compelled to surrender such payment or proceeds to any Person because such payment or application of proceeds is invalidated, declared fraudulent, set aside, determined to be void or voidable as a preference, impermissible setoff, or a diversion of trust funds, or for any other reason (including pursuant to any settlement entered into by the Administrative Agent or such Lender in its discretion), then the Obligations or part thereof intended to be satisfied shall be revived and continued and this Agreement shall continue in full force as if such payment or proceeds had not been received by the Administrative Agent or such Lender. The provisions of this Section 2.21 shall be and remain effective notwithstanding any contrary action which may have been taken by the Administrative Agent or any Lender in reliance upon such payment or application of proceeds. The provisions of this Section 2.21 shall survive the termination of this Agreement.
ARTICLE III
Collections and Payments
SECTION 3.01. Deemed Collections . Except for Overadvances permitted under Section 2.05, upon the occurrence of any Dilution, the Borrower shall be deemed to have received a Deemed Collection and such Deemed Collection shall be immediately applied to reduce the Outstanding Balance of the Eligible Receivables by the amount of such Deemed Collection; provided that if such reduction causes a Borrowing Base Deficiency, the Borrower shall within one (1) Business Day of the Borrower’s knowledge thereof deliver to the Servicer immediately available funds in an amount equal to the lesser of (a) the amount of such Deemed Collection and (b) the amount necessary to eliminate such Borrowing Base Deficiency, and, in each case, the Servicer shall remit such amount to the Administrative Agent pursuant to this Article III; provided , further , that at all times after an Amortization Event has occurred and is continuing, the Borrower shall pay an amount equal to such Deemed Collection to the Collection Account to be distributed in the same manner as actual cash collections are distributed pursuant to this Article III. If the Borrower receives any payments in respect of any portion of a Receivable for which it has been deemed to have received a Deemed Collection (other than amounts payable by the Seller under Section 2.04 of the Receivables Sale Agreement), the Borrower shall promptly remit such payments to the Seller for distribution, if applicable, to the related Originator. No such payments will be deemed to be a Collection or property of the Borrower or constitute Collateral and, until remitted in accordance with the foregoing sentence, shall be instead be held in trust for the Seller and, if applicable, the related Originator.
SECTION 3.02. Collections During the Revolving Period . On each day during the Revolving Period, except to the extent paid directly to the Administrative Agent by any Collection Bank pursuant to a Collection Notice, all Collections and/or Deemed Collections received by the Servicer shall be held in trust for the payment of any accrued and unpaid Obligations; provided that (i) payments shall not be required with respect to the Aggregate Credit Exposure during the Revolving Period except to the extent provided in Article II, and (ii) Collections and/or Deemed Collections shall not be required to be segregated during the Revolving Period (other than during any Cash Dominion Trigger Period) but instead may be used by the Servicer and its Affiliates in accordance with Section 8.02.
 
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SECTION 3.03. Collections During the Amortization Period . On each day during the Amortization Period, except to the extent paid directly to the Administrative Agent by any Collection Bank pursuant to a Collection Notice, all Collections shall be held by the Servicer in trust for the exclusive benefit of the Administrative Agent and the Lenders in a segregated account which is subject to a first priority perfected security interest in favor of the Administrative Agent for the benefit of the Lenders (or retained in a Collection Account). Except to the extent paid directly to the Administrative Agent by any Collection Bank pursuant to a Collection Notice, the Servicer shall deliver to the Administrative Agent all Collections held by the Servicer during the Amortization Period. All Collections delivered by the Servicer to the Administrative Agent (or paid directly to the Administrative Agent) pursuant to this Section 3.03 shall be applied in accordance with Section 2.18.
SECTION 3.04. Payment Rescission . No payment of any of the Obligations shall be considered paid or applied hereunder to the extent that, at any time, all or any portion of such payment or application is rescinded by application of law or judicial authority, or must otherwise be returned or refunded for any reason. The Borrower shall remain obligated for the amount of any payment or application so rescinded, returned or refunded, and shall promptly pay to the Administrative Agent or the applicable Lender the full amount thereof together with interest thereon from the date of any such rescission, return or refunding.
ARTICLE IV
Representations and Warranties
Each of Anixter and the Borrower hereby makes the following representations and warranties to the Administrative Agent and the Lenders which shall be true, correct and complete in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the Effective Date, and shall be true, correct, and complete, in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the date of the making of each Borrowing or issuance, amendment, renewal or extension of any Letter of Credit made thereafter, as though made on and as of the date of such Borrowing or issuance, amendment, renewal or extension of any Letter of Credit) (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of such earlier date) and such representations and warranties shall survive the execution and delivery of this Agreement:
SECTION 4.01. Organization; Powers . Each of AXE, Anixter, and the Subsidiaries of Anixter is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization; has all requisite power and authority to own, operate, and encumber its property and assets to carry on its business as now conducted and proposed to be conducted in connection with and following the consummation of the Related Transactions; and, except where the failure to do so, individually or in the aggregate, has not resulted in and could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business, and is in good standing, in every jurisdiction where it owns or leases real property or where such qualification is required.
SECTION 4.02. Authorization; Enforceability . Each of AXE, Anixter, and the Subsidiaries of Anixter party to any of the Related Transactions Documents has the requisite organizational power and authority to execute, deliver, and perform its obligations under each of the Related Transactions Documents executed by it or to be executed by it. The execution, delivery, and
 
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performance (or filing or recording, as the case may be) by AXE, Anixter, and each Subsidiary of Anixter of each Related Transactions Document to which such Person is a party and the consummation of the transactions contemplated thereby have been duly authorized by all necessary organizational actions and no other organizational proceedings on the part of any such Person are necessary to consummate the such transactions. Each Related Transaction Document to which AXE, Anixter, or a Subsidiary of Anixter is a party has been duly executed and delivered by such Person and constitutes a legal, valid, and binding obligation of such Person, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
SECTION 4.03. Governmental Approvals; No Conflicts . The execution, delivery, and performance by each of AXE, Anixter, and each Subsidiary of Anixter of each Related Transactions Documents to which it is party and each of the transactions contemplated thereby, do not and will not (a) except for any filings to perfect the security interests granted pursuant to the Loan Documents, require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, (b) conflict with or violate such Person’s Organization Documents, (c) except as set forth on Schedule 4.03 , conflict with, result in a breach of, or constitute (with or without notice or lapse of time or both) a default under any Requirement of Law or Contractual Obligation of any such Person, or require termination of any Contractual Obligation of any such Person, in each case, which could reasonably be expected to have a Material Adverse Effect, (d) conflict with any Contractual Obligation of any such Person, any liability resulting from which has resulted in or could be reasonably expected to result in a Material Adverse Effect, (e) result in or require the creation or imposition of any Lien on any asset of any such Person, except Liens permitted by Section 7.02 or (f) require any approval of stockholders of any such Person, unless such approval has been obtained.
SECTION 4.04. Financial Condition; No Material Adverse Change .
(a) As of the Effective Date, all quarterly and annual financial statements of Anixter or of Anixter and any of its Subsidiaries delivered to the Administrative Agent and the Lenders were prepared in conformity with GAAP (except as otherwise noted therein) and fairly present in all material respects the financial position of Anixter or the consolidated financial position of Anixter and such Subsidiaries, as the case may be, as at the respective dates thereof and the results of operations and changes in cash flows for each of the periods covered thereby, subject, in the case of any unaudited interim financial statements, to changes resulting from audit and normal year-end adjustments.
(b) All quarterly and annual financial statements of Anixter or of Anixter and any of its Subsidiaries delivered to the Administrative Agent on or prior to the date this representation is made or deemed made were prepared in conformity with GAAP (except as otherwise noted therein) and fairly present in all material respects the financial position of Anixter or the consolidated financial position of Anixter and such Subsidiaries, as the case may be, as at the respective dates thereof and the results of operations and changes in cash flows for each of the periods covered thereby, subject, in the case of any unaudited interim financial statements, to changes resulting from audit and normal year-end adjustments.
(c) With respect to each of AXE, Anixter, and Anixter and its Subsidiaries taken as a whole, no event has occurred since the Friday closest to December 31, 2014, that has resulted in or could reasonably be expected to result in a Material Adverse Effect.
 
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SECTION 4.05. Properties .
(a) As of the date of this Agreement, Schedule 4.05 sets forth the address of each parcel of real property that is owned or leased by Anixter or any of its Subsidiaries and that (i) is a chief executive office of such Person, (ii) maintains such Person’s books and records, and/or (iii) maintains Inventory with a value of $5,000,000 or greater at any time. Each of such leases and subleases is valid and enforceable in accordance with its terms and is in full force and effect, and no default by any party to any such lease or sublease exists which could reasonably be expected to have a Material Adverse Effect. Each of AXE, Anixter, and each Subsidiary of Anixter has good title to all of its personal property, except for imperfections of title (including Liens to the extent permitted by Section 7.02) which in the aggregate could not reasonably be expected to have a Material Adverse Effect. All such assets are free and clear of all Liens, except as otherwise specifically permitted by the terms and provisions of this Agreement and the other Loan Documents. Substantially all of the assets and properties owned by, leased to, or used by Anixter or any Domestic Subsidiary of Anixter are in good repair, working order and condition, excepting ordinary wear and tear and are free and clear of any known defects except such defects as do not substantially interfere with the continued use thereof in the conduct of normal operations.
(b) Anixter and each Inventory Facility Loan Party owns, is licensed to use, or otherwise has the lawful right to use or has all permits and other approvals of Governmental Authorities, all trademarks, tradenames, copyrights, patents and other intellectual property necessary to its business as currently conducted and proposed to be conducted in connection with and following the consummation of the Related Transactions which are material to its financial condition, business, operations, assets and prospects, individually or taken as a whole. A correct and complete list of all trademarks, tradenames, copyrights, and patents owned by Anixter or an Inventory Facility Loan Party referred to in the preceding sentence, , as of the date of this Agreement, is set forth on Schedule 4.05 . The use of such intellectual property by Anixter and its Subsidiaries does not infringe in any material respect upon the rights of any other Person, subject to such claims and infringements the existence of which do not have or could not reasonably be expected to have a Material Adverse Effect.
SECTION 4.06. Litigation and Environmental Matters .
(a) There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of Anixter, threatened in writing against or affecting any of AXE, Anixter or the Borrower, or any Subsidiary (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters) or (ii) that challenges the enforceability of any of the Related Transactions Documents.
(b) None of AXE, Anixter, and the Subsidiaries of Anixter are subject to or in default with respect to any final judgment, writ, injunction, decree, order, rule or regulation of any court or Governmental Authority which has had or could reasonably be expected to have a Material Adverse Effect.
(c) Except for the Disclosed Matters and except as could not reasonably be expected to have a Material Adverse Effect, (i) each of the operations of AXE, Anixter, and the Subsidiaries of Anixter comply with all applicable Environmental Laws and all Requirements of Law (relating to health and safety matters); (ii) each of AXE, Anixter and the Subsidiaries of Anixter has obtained all Permits (as such term is used in the definition of “Environmental Laws”) necessary for its operations, all such Permits are in good standing and AXE, Anixter and the Subsidiaries of Anixter are in compliance with all terms and conditions of such Permits; and (iii)(A) neither AXE, Anixter nor any Subsidiary of Anixter, nor any of their present Property or operations and (B) to the knowledge of Anixter, none of AXE’s, Anixter’s or
 
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the Subsidiaries of Anixter’s previously owned Property or past operations is subject to any Remedial Action or other liabilities and costs arising from the Release or threatened Release of a Hazardous Material into environment.
SECTION 4.07. Compliance with Laws and Agreements; No Potential Amortization Event . Except where the failure to do so, individually or in the aggregate, has not resulted in and could not reasonably be expected to result in a Material Adverse Effect, each of AXE, Anixter, and the Subsidiaries of Anixter is in compliance with (i) all Requirements of Law applicable to it or its business and (ii) all indentures, agreements, and other instruments binding upon it or its property. No Potential Amortization Event or Amortization Event has occurred and is continuing.
SECTION 4.08. Investment Company Status . The Borrower is not an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940.
SECTION 4.09. Taxes . Each of AXE, Anixter, and the Subsidiaries of Anixter has timely filed or caused to be filed all United States federal income and other material Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings and for which such Person has set aside on its books adequate reserves with respect thereto in accordance with GAAP, (b) Taxes which are not yet delinquent, (c) Taxes which are payable in installments so long as paid before any penalty accrues with respect thereto, and (d) Taxes which do not exceed $500,000 in the aggregate. Except as set forth in clauses (a) through (d) above, no such Person has any knowledge of any proposed tax assessment against Anixter or any of Anixter’s Subsidiaries which could reasonably be expected to result in a Material Adverse Effect. No tax liens have been filed and no claims are being asserted with respect to any such taxes except for Taxes not exceeding $500,000 in the aggregate.
SECTION 4.10. ERISA . No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. As of each date that this representation is made or deemed made, the present value of all “accumulated projected benefit obligations” (as determined for purposes of AXE’s Form 10-K) of all underfunded Pension Plans (based on the assumptions used by the Plans to determine benefit obligations on an ongoing basis) did not, as of the date of the most recent financial statements reflecting such amounts, exceed by more than $75,000,000 the fair market value of the assets of all such underfunded Plans.
SECTION 4.11. Disclosure . Subject to changes in facts or conditions which are required or permitted under this Agreement, none of the reports, financial statements, certificates or other information furnished by or on behalf of any of AXE, Anixter, and the Subsidiaries of Anixter to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or any other Loan Document (as modified or supplemented by other information so furnished), taken as a whole, contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
SECTION 4.12. Performance . None of AXE, Anixter, and the Subsidiaries of Anixter is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Contractual Obligation applicable to it the effect of which could reasonably be expected to result in a Material Adverse Effect, and no condition exists which, with the giving of notice or the lapse of time or both, would constitute a default under any such Contractual Obligation, except where the consequences, direct or indirect, of such default or defaults, if any, have not resulted in and could not reasonably be expected to result in a Material Adverse Effect.
 
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SECTION 4.13. Solvency . The Borrower and Anixter and its Subsidiaries are Solvent after giving effect to the transactions contemplated by this Agreement and the other Related Transactions Documents.
SECTION 4.14. Insurance . Schedule 4.14 sets forth a description of all insurance maintained by or on behalf of the Borrower and Anixter and its Subsidiaries as of the Effective Date. As of the Effective Date, all premiums in respect of such insurance have been paid. The Borrower maintains, with financially sound and reputable insurance companies, insurance on all its real and personal property in such amounts, subject to such deductibles and self-insurance retentions and covering such properties and risks as are adequate and customarily maintained by companies engaged in the same or similar businesses operating in the same or similar locations.
SECTION 4.15. Capitalization and Subsidiaries; Joint Venture; Partnership .
(a) As of the Effective Date, Schedule 4.15 sets forth (i) a correct and complete list of the name of each Subsidiary of Anixter, (ii) a true and complete listing of each class of each of such Person’s authorized Equity Interests, all of which issued Equity Interests are owned beneficially and of record by the Persons identified on Schedule 4.15 , and (iii) the type of entity of each such Person. All of the issued and outstanding Equity Interests of each such Subsidiary have been (to the extent such concepts are relevant with respect to such ownership interests) duly authorized and issued and are fully paid and non-assessable. There are no outstanding commitments or other obligations of Anixter or any such Subsidiary to issue, and no options, warrants or other rights of any Person to acquire, any shares of any class of capital stock or other equity interests of Anixter or any such Subsidiary.
(b) Anixter has no Subsidiaries other than those described in Schedule 4.15 and those, if any, which are permitted by Section 7.04(a) to be created after the Effective Date.
(c) Except as set forth in Schedule 4.15 or as otherwise permitted in this Agreement, none of AXE, Anixter, and the Subsidiaries of Anixter is engaged in any material partnership or material joint venture with any other Person.
SECTION 4.16. Security Interest in Collateral . The provisions of this Agreement and the other Loan Documents create legal and valid Liens on all of the Collateral in favor of the Administrative Agent, for the benefit of the Secured Parties, and such Liens constitute perfected and continuing Liens on the Collateral, securing the Secured Obligations, enforceable against the Borrower and all third parties, and having priority over all other Liens on the Collateral except in the case of (a) Permitted Encumbrances, to the extent any such Permitted Encumbrances would have priority over the Liens in favor of the Administrative Agent pursuant to any applicable law, and (b) Liens perfected only by possession (including possession of any certificate of title), to the extent the Administrative Agent has not obtained or does not maintain possession of such Collateral.
SECTION 4.17. Reserved .
SECTION 4.18. Federal Reserve Regulations . No part of the proceeds of any Loan or Letter of Credit has been used or will be used, whether directly or indirectly, for any purpose that entails a violation of Regulation T, U or X.
SECTION 4.19. Use of Proceeds . The proceeds of the Loans have been used and will be used, whether directly or indirectly as set forth in Section 6.08.
SECTION 4.20. Reserved .
 
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SECTION 4.21. Restricted Payments to AXE . On or after the Effective Date, none of Anixter and its Subsidiaries has directly or indirectly declared, ordered, paid or made or set apart any sum or property for any payment, distribution, or contribution to or investment in AXE (whether in cash or otherwise) or agreed to do so, except to the extent permitted pursuant to Section 7.08(a).
SECTION 4.22. Anti-Corruption Laws and Sanctions . Each of AXE, Anixter, and the Subsidiaries of Anixter has implemented and maintains in effect policies and procedures designed to ensure compliance by such Person, its Subsidiaries, and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and such Person, its Subsidiaries, and their respective officers and employees and, to the knowledge of such Person, its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects and are not knowingly engaged in any activity that would reasonably be expected to result in any of AXE, Anixter, and the Subsidiaries of Anixter being designated as a Sanctioned Person. None of (a) AXE, Anixter, and the Subsidiaries of Anixter or, to the knowledge of any such Person, any of their respective directors, officers or employees, or (b) to the knowledge of any such Person, any agent of such Person that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. No Borrowing or Letter of Credit, use of proceeds, Transaction or other transaction contemplated by this Agreement or the other Loan Documents will violate Anti-Corruption Laws or applicable Sanctions.
SECTION 4.23. HD Supply Acquisition .
(a) Anixter has delivered to the Administrative Agent a complete and correct copy of the HD Supply Acquisition Documents, including all schedules and exhibits thereto. The execution, delivery and performance of each HD Supply Acquisition Document has been duly authorized by all necessary action on the part of Anixter and each Subsidiary of Anixter that is a party thereto. Each HD Supply Acquisition Document is the legal, valid and binding obligation of Anixter or each Subsidiary of Anixter who is a party thereto, enforceable against each such Person in accordance with its terms, in each case, except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting generally the enforcement of creditors’ rights and (ii) the availability of the remedy of specific performance or injunctive or other equitable relief is subject to the discretion of the court before which any proceeding therefor may be brought. As of the Effective Date, all representations and warranties made by of Anixter and its Subsidiaries in the HD Supply Acquisition Documents and in the certificates delivered in connection therewith are true and correct in all material respects.
(b) As of the Effective Date, after giving effect to the transactions contemplated by the HD Supply Acquisition Documents, one or more of Anixter and its Subsidiaries will have good title to the Equity Interests and assets acquired pursuant to the HD Supply Acquisition Agreement, free and clear of all Liens other than Permitted Encumbrances and Liens permitted by Section 7.02(a)(v) and Section 7.02(a)(ix).
SECTION 4.24. Compliance with Credit and Collection Policy . Each of the Borrower and the Servicer has complied in all material respects with the applicable Credit and Collection Policy with regard to each Receivable and the related Contract and has not made any material change to any Credit and Collection Policy, except such material change as to which the Administrative Agent has been notified in accordance with Section 6.02(l).
SECTION 4.25. Enforceability of Contracts . Each Contract is effective to create, and has created, a legal, valid and binding obligation of the related Obligor to pay the Outstanding Balance of the related Receivable and any accrued interest thereon, enforceable against such Obligor in accordance with
 
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its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws relating to or limiting creditors’ rights generally and by general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).
SECTION 4.26. Eligible Receivables . Each Receivable included as an Eligible Receivable on the date of its purchase under the Receivables Sale Agreement was an Eligible Receivable on such purchase date, and, as of the date of each Borrowing Base Certificate, each Receivable included as an Eligible Receivables Balance on each such Borrowing Base Certificate or other report was an Eligible Receivable.
SECTION 4.27. Indebtedness . Set forth on Schedule 7.01 is a true and complete list of all Indebtedness of the Borrower, Anixter and its Subsidiaries outstanding as of October 5, 2015 that is to remain outstanding immediately after giving effect to the closing hereunder on the Effective Date and such schedule accurately sets forth the aggregate principal amount of such Indebtedness as of the Effective Date.
SECTION 4.28. Remittances of Collections . Each remittance of Collections by the Borrower to the Administrative Agent or any Lender under this Agreement will have been (a) in payment of a debt incurred by the Borrower in the ordinary course of the business or financial affairs of the Borrower and the Administrative Agent or such Lender and (b) made in the ordinary course of the business or financial affairs of the Borrower and the Administrative Agent or such Lender.
For the avoidance of doubt, each reference in this Article IV to “the Subsidiaries of Anixter” includes the Borrower.
ARTICLE V
Conditions
SECTION 5.01. Effective Date . The obligations of the Lenders to make Loans and of each Issuing Bank to issue Letters of Credit hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 11.02):
(a) Credit Agreement and Other Loan Documents . The Administrative Agent (or its counsel) shall have received (i) from each party hereto either (A) a counterpart of this Agreement signed on behalf of such party or (B) written evidence satisfactory to the Administrative Agent (which may include facsimile or other electronic transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement, (ii) either (A) a counterpart of each other Loan Document signed on behalf of each party thereto or (B) written evidence satisfactory to the Administrative Agent (which may include facsimile or other electronic transmission of a signed signature page thereof) that each such party has signed a counterpart of such Loan Document, (iii) a completed Perfection Certificate for the Borrower, Anixter and its applicable Subsidiaries, and (iv) such other certificates, documents, instruments and agreements as the Administrative Agent shall reasonably request in connection with the transactions contemplated by this Agreement and the other Loan Documents, including any promissory notes requested by a Lender pursuant to Section 2.10 payable to the order of each such requesting Lender and a written opinion of the Borrower’s counsel, addressed to the Administrative Agent, each Issuing Bank and the Lenders in substantially the form of Exhibit B , all in form and substance satisfactory to the Administrative Agent and its counsel.
(b) Financial Statements and Projections . (i) The Lenders shall have received a pro forma consolidated balance sheet, income statement and cash flow statement (“ Pro Forma Opening Statements ”) giving effect to the HD Supply Acquisition together with such information as the Lenders may reasonably request to confirm the tax, legal, and business assumptions made in such Pro Forma Opening Statements.

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(ii) The Lenders shall have received (A) unaudited interim consolidated financial statements of Anixter for each fiscal quarter ended subsequent to March 31, 2015, and such financial statements shall not, in the reasonable judgment of the Administrative Agent, reflect any material adverse change in the consolidated financial condition of Anixter, as reflected in the audited, consolidated financial statements of the last fiscal year of Anixter, and (B) satisfactory projections beginning July 1, 2015 and ending December 31, 2016, on a quarterly basis.
(c) Officer Certificates; Certified Certificate of Incorporation; Good Standing Certificates . The Administrative Agent shall have received (i) a certificate of the Borrower, dated the Effective Date and executed by its Secretary, Assistant Secretary or other similar officer, which shall (A) certify the resolutions of its Board of Directors, members or other body authorizing the execution, delivery and performance of the Loan Documents to which it is a party, (B) identify by name and title and bear the signatures of the officers of the Borrower authorized to sign the Loan Documents to which it is a party and, in the case of the Borrower, its Financial Officers, and (C) contain appropriate attachments, including the certificate or articles of incorporation or organization of the Borrower certified by the relevant authority of the jurisdiction of organization of the Borrower and a true and correct copy of its by-laws or operating, management or partnership agreement, or other organizational or governing documents, and (ii) a good standing certificate for the Borrower from its jurisdiction of organization or the substantive equivalent available in the jurisdiction of organization for the Borrower from the appropriate governmental officer in such jurisdiction.
(d) Closing Certificate . The Administrative Agent shall have received a certificate, signed by a Financial Officer of the Borrower, dated as of the Effective Date stating that upon giving effect to the initial extension of credit under this Agreement (i) no Potential Amortization Event has occurred and is continuing, (ii) each of the Specified Representations are true and correct as of such date, and (iii) certifying that each of the conditions set forth in this Section 5.01 have been (or substantially simultaneously with the closing of the Transactions, will be) satisfied.
(e) Fees . The Lenders and the Administrative Agent shall have received all fees required to be paid, and all expenses for which invoices have been presented (including the reasonable fees and expenses of legal counsel), on or before the Effective Date. All such amounts will be paid with proceeds of Loans made on the Effective Date and will be reflected in the funding instructions given by the Borrower to the Administrative Agent on or before the Effective Date.
(f) Lien Searches . The Administrative Agent shall have received the results of a recent lien search in the jurisdiction where the Borrower is organized, and where any Originator is located, and such search shall reveal no Liens on any of the assets of the Borrower or on the assets being transferred to the Borrower except for Liens permitted by Section 7.02 and under the Receivables Facility Transaction Documents, as applicable, or discharged on or prior to the Effective Date pursuant to a pay-off letter or other documentation satisfactory to the Administrative Agent.
(g) Pay-Off Letter . The Administrative Agent shall have received satisfactory pay-off letters for all existing Indebtedness (including Indebtedness (i) under a Second Amendment and Incremental Facility Agreement, dated as of August 27, 2014, by and among Anixter, certain subsidiaries of Anixter, the guarantors party thereto, and Wells Fargo, as administrative agent, and (ii) under the 2011 Receivables Purchase Agreement to be repaid from the proceeds of the initial Borrowing, confirming that all Liens upon any of the property of the Borrower constituting Collateral will be terminated concurrently with such payment and all letters of credit issued or guaranteed as part of such Indebtedness shall have been cash collateralized or supported by a Letter of Credit.
 
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(h) Funding Account . The Administrative Agent shall have received a notice setting forth the deposit account of the Borrower (the “ Funding Account ”) to which the Administrative Agent is authorized by the Borrower to transfer the proceeds of any Borrowings requested or authorized pursuant to this Agreement.
(i) Reserved.
(j) Solvency . The Administrative Agent shall have received a solvency certificate signed by a Financial Officer dated the Effective Date.
(k) Borrowing Base Certificate . The Administrative Agent shall have received a Borrowing Base Certificate which calculates the Borrowing Base (on a pro forma basis after giving effect to the HD Supply Acquisition) as of the end of the Fiscal Month immediately preceding the Effective Date and includes customary supporting documentation and supplemental reporting satisfactory to the Administrative Agent.
(l) Closing Combined Availability . After giving effect to all Borrowings to be made on the Effective Date, the issuance of any Letters of Credit on the Effective Date and the payment of all fees and expenses due hereunder, and with all of the Borrower’s indebtedness, liabilities, and obligations current, Combined Availability shall not be less than $250,000,000.
(m) Filings, Registrations and Recordings . Each document (including any Uniform Commercial Code financing statement) required by the Collateral Documents or under law or reasonably requested by the Administrative Agent to be filed, registered or recorded in order to create in favor of the Administrative Agent, for the benefit of itself and the Lenders, a perfected Lien on the Collateral described therein, prior and superior in right to any other Person (other than with respect to Liens expressly permitted by Section 7.02), shall be in proper form for filing, registration or recordation; provided that notwithstanding the foregoing, to the extent any Collateral is not provided on the Effective Date after the Borrower’s use of commercially reasonable efforts to do so (other than (i) the filing of UCC financing statements, (ii) the filing of intellectual property security agreements for intellectual property that is registered as of the Effective Date and (iii) the delivery of stock certificates), the providing of such Collateral shall not be required as a condition to the closing hereunder.
(n) HD Supply Acquisition . The Administrative Agent shall be satisfied with the HD Supply Acquisition Documents (it being acknowledged that the Administrative Agent is satisfied with the HD Supply Purchase Documents provided on or prior to July 22, 2015) and shall have received a true, correct and complete copy of the same. None of the Targets nor the HD Sellers have (1) announced that it will oppose the HD Supply Acquisition or (2) commenced any action which alleges that the HD Supply Acquisition will violate applicable law. No injunction or temporary restraining order shall exist which, in the judgment of the applicable Administrative Agent, would prohibit the making of the Loans or the consummation of the HD Supply Acquisition. The Administrative Agent shall have received evidence that each of the items described in Section 2.8 of the HD Supply Acquisition Agreement will be delivered, each of the conditions precedent set forth in Sections 7.1 and 7.2 of the HD Supply Acquisition Agreement will be satisfied (or, with the written approval of the Administrative Agent, waived) and the HD Supply Acquisition will be consummated, in each case, substantially simultaneously with the closing of the Transactions contemplated hereunder and no other provision of the HD Supply Purchase Documents shall have been waived, amended, supplemented, or otherwise modified in any material and adverse respect without approval of the Administrative Agent.
 
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(o) Inventory Facility . The Administrative Agent shall have received evidence that the Inventory Facility has closed (or will be closing substantially concurrently with the closing hereunder) on terms and conditions reasonably satisfactory to the Administrative Agent.
(p) Issuance of Senior Notes . Anixter shall have issued up to $500,000,000 of new senior unsecured notes for the purpose of financing a portion of the purchase price of the HD Supply Acquisition, on terms and conditions reasonably satisfactory to the Administrative Agent.
(q) Insurance . The Administrative Agent shall have received evidence of insurance coverage in form, scope, and substance reasonably satisfactory to the Administrative Agent and otherwise in compliance with the terms of Section 6.10 hereof and under Section 4.12 of the Security Agreement.
(r) Compliance with Regulations . This Agreement and the other Loan Documents shall not violate applicable requirements of Regulations U, T and X of the Board of Governors of the Federal Reserve System.
(s) Letter of Credit Application . If a Letter of Credit is requested to be issued on the Effective Date, the Administrative Agent shall have received a properly completed letter of credit application (whether standalone or pursuant to a master agreement, as applicable). The Borrower shall have executed the Issuing Bank’s master agreement for the issuance of commercial Letters of Credit.
(t) Field Examination . The Administrative Agent or its designee shall have conducted a field examination of the Receivables and related working capital matters and financial information of the Targets and of the related data-processing and other systems, the results of which shall be satisfactory to the Administrative Agent in its sole discretion.
(u) Legal Due Diligence . The Administrative Agent and its counsel shall have completed all legal due diligence, the results of which shall be satisfactory to Administrative Agent in its sole discretion.
(v) USA PATRIOT Act, Etc . The Administrative Agent and the Lenders shall have received all documentation and other information as is reasonably requested by the Administrative Agent as least five (5) business days before the Effective Date under applicable “know your customer” and anti-money laundering rules and regulations, including the USA PATRIOT Act, for the Borrower.
(w) Anixter Canada Loan . Anixter Canada shall have borrowed (or will be borrowing substantially concurrently with the closing hereunder) a term loan in an original principal amount of up to CAD 300,000,000 for the purpose of financing a portion of the purchase price of the HD Supply Acquisition, on terms and conditions reasonably satisfactory to the Administrative Agent.
(x) AXE . The Administrative Agent shall have received all documentation and information as is reasonably requested at least five (5) Business Days before the Effective Date about AXE, its Subsidiaries, and each Target mutually agreed to be required by U.S. regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act.
(y) Receivables Facility Transaction Documents . The Administrative Agent shall have received a true, correct and complete copy of the Receivables Facility Transaction Documents and the Subscription Agreement, each in form and substance reasonably satisfactory to the Administrative Agent.
 
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(z) Termination of Existing Receivables Arrangements . The Administrative Agent shall have received satisfactory evidence of the termination of each existing arrangement under which Receivables of any Originator have been or are transferred to any entity (including any affiliate of Anixter) other than the Borrower (including the 2011 Receivables Purchase Agreement); and release or transfer, as applicable, of all liens, if any, granted under each such existing arrangement; and return transfer to the Borrower by each such ultimate transferee and any intermediate transferee under any such existing arrangement of all accounts receivable of Anixter or such Originator transferred to such transferee thereunder.
(aa) Other Debt Instruments . The material debt instruments and governing documents of the Borrower after the HD Supply Acquisition shall be reasonably acceptable to the Administrative Agent.
(bb) Other Events . There has not occurred any event, development, or circumstance that has or could reasonably be expected to have a material adverse effect on the business, operations, property, or condition (financial or otherwise) of the Borrower or Anixter and its Subsidiaries, taken as a whole.
(cc) No Material Adverse Effect . Since February 1, 2015, no “Material Adverse Effect” under and as defined in the Acquisition Agreement has occurred.
(dd) Other Documents . The Administrative Agent shall have received such other documents as the Administrative Agent, the Issuing Bank, any Lender or their respective counsel may have reasonably requested.
The Administrative Agent shall notify the Borrower, the Lenders and the Issuing Bank of the Effective Date, and such notice shall be conclusive and binding. Notwithstanding the foregoing, the obligations of the Lenders to make Loans and of the Issuing Bank to issue Letters of Credit hereunder shall not become effective unless each of the foregoing conditions is satisfied (or waived pursuant to Section 11.02) at or prior to 2:00 p.m., Chicago time, on October 5, 2015 (and, in the event such conditions are not so satisfied or waived, the Commitments shall terminate at such time).
SECTION 5.02. Each Credit Event . The obligation of each Lender to make a Loan on the occasion of any Borrowing, and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit, is subject to the satisfaction of the following conditions:
(a) (i) as of the Effective Date, each of the HD Supply Acquisition Agreement Representations and the Specified Representations shall be true, correct, and complete, in all material respects (except that any representations and warranties which is subject to any materiality qualifier shall be true, correct and complete in all respects), and (ii) at and as of the date of each Borrowing or issuance, amendment, renewal or extension of any Letter of Credit made after the Effective Date, the representations and warranties of the Borrower and Anixter set forth in the Loan Documents shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date of such Borrowing or the date of issuance, amendment, renewal or extension of such Letter of Credit, as applicable, as though made on and as of such date (except to the extent that such representations or warranties related solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of such earlier date).
(b) (i) as of the Effective Date, no Potential Amortization Event or Amortization Event (other than an Amortization Event described in clause (c) of Article IX (or a related Potential Amortization
 
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Event) not in respect of the Specified Representations and the “Specified Representations” under and as defined in the Inventory Facility Credit Agreement) shall have occurred and be continuing, nor shall either result from the making of any Borrowing or the issuance, amendment, renewal or extension of a Letter of Credit, as applicable, made after the Effective Date; (ii) at and as of the date of each Borrowing or the issuance, amendment, renewal or extension of a Letter of Credit made after the Effective Date, no Potential Amortization Event or Amortization Event shall have occurred and be continuing, and (iii) no Protective Advance shall be outstanding.
(c) After giving effect to any Borrowing or the issuance, amendment, renewal or extension of any Letter of Credit, Availability shall not be less than zero.
(d) No Borrowing Base Deficiency exists or will result from the making of such Loan or issuance, amendment, renewal or extension of any Letter of Credit.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of Credit shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in paragraphs (a), (b), (c) and (d) of this Section.
Notwithstanding the failure to satisfy the conditions precedent set forth in paragraphs (a) or (b) of this Section, unless otherwise directed by the Required Lenders, the Administrative Agent may, but shall have no obligation to, continue to make Loans and an Issuing Bank may, but shall have no obligation to, issue, amend, renew or extend, or cause to be issued, amended, renewed or extended, any Letter of Credit for the ratable account and risk of Lenders from time to time if the Administrative Agent believes that making such Loans or issuing, amending, renewing or extending, or causing the issuance, amendment, renewal or extension of, any such Letter of Credit is in the best interests of the Lenders.
ARTICLE VI
Affirmative Covenants
Until the Commitments shall have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit shall have expired or terminated in each case without any pending draw, and all LC Disbursements shall have been reimbursed, Anixter, in its capacity as the Servicer, and the Borrower covenants and agrees with the Administrative Agent and the Lenders that:
SECTION 6.01. Financial Statements; Borrowing Base and Other Information . Anixter or the Borrower, as applicable, will furnish (or will caused to be furnished) to the Administrative Agent:
(a) within ninety (90) days after the end of each Fiscal Year, on a consolidated basis for AXE, a balance sheet and related statements of operations, stockholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all reported on by Ernst & Young LLP or other firm of independent public accountants of recognized national standing regularly retained by AXE and reasonably acceptable to the Administrative Agent (without a “going concern” or like qualification, commentary, or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Consolidated Group on a consolidated basis in accordance with GAAP consistently applied;
(b) within forty-five (45) days after the end of each Fiscal Quarter (other than the last Fiscal Quarter of a Fiscal Year, which shall be delivered within sixty (60) days after the end of such Fiscal
 
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Quarter), on a consolidated basis for AXE, a balance sheet and related statements of operations, stockholders’ equity and cash flows as of the end of and for such Fiscal Quarter and the then elapsed portion of such Fiscal Year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous Fiscal Year, all certified by a Financial Officer of AXE as presenting fairly in all material respects the financial condition and results of operations of AXE on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery of a Borrowing Base Certificate under clause (f) below or financial statements under clause (a) or (b) above, a certificate of a Financial Officer of AXE in substantially the form of Exhibit D (i) certifying, in the case of the financial statements delivered under clause (b), as presenting fairly in all material respects the financial condition and results of operations of AXE on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes, (ii) certifying as to whether a Potential Amortization Event or an Amortization Event has occurred and, if a Potential Amortization Event or an Amortization Event has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (iii) setting forth, in the case of each such certificate delivered concurrently with the delivery of financial statements under clauses (a) and (b) above, reasonably detailed calculations of the financial covenants contained in this Agreement for or as of the end of each Fiscal Quarter then ended (regardless of whether a Financial Covenant Trigger Period is then in effect), and (iv) setting forth, in the case of each such certificate delivered concurrently with the delivery of financial statements under clauses (a) and (b) above (and in the case of each such certificate delivered concurrently with the delivery of a Borrowing Base Certificate under clause (f) below after the end of any Fiscal Month in which Inventory Facility Availability was less than 50% of the Inventory Facility Commitment), a reasonably detailed calculation of the Secured Debt-to CTNA Ratio;
(d) as soon as available but in any event within forty-five (45) days after the end of each Fiscal Year and at such other times as may be reasonably requested by the Administrative Agent, a Perfection Certificate or a supplement to the Perfection Certificate;
(e) as soon as available but in any event no later than ninety (90) days after the end of each Fiscal Year, for AXE on a consolidated basis, a copy of the plan and forecast (including a projected balance sheet, income statement and cash flow statement) of AXE and its Subsidiaries, taken as a whole, for the upcoming period of four Fiscal Quarters (the “ Projections ”), all in form customarily prepared by Anixter’s management and reasonably satisfactory to the Administrative Agent, to be accompanied by a certificate of a Financial Officer of Anixter to the effect that such Projections have been prepared on a basis believe by Anixter to be reasonable, which Projections shall include projected Availability, projected Combined Availability, and projected Senior Debt-to-CTNA Ratio for or as of the end of each of the four Fiscal Quarters covered by such Projections;
(f) as soon as available but in any event within thirty (30) days after the end of each Fiscal Month (or, during an Enhanced Reporting Trigger Period, weekly, no later than the second Business Day of each week for the prior week), and at such other times as may be necessary to re-determine Availability and/or Combined Availability or as may be reasonably requested by the Administrative Agent, as of the period then ended, a Borrowing Base Certificate and supporting information in connection therewith (including, in respect of any Borrowing Base Certificate delivered for a Fiscal Month which is also the end of any Fiscal Quarter, a calculation of Average Quarterly Combined Availability for such quarter then ended and an indication of what the Applicable Rate is as a result of such Average Quarterly Combined Availability), together with any additional reports with respect to the Borrowing Base as the Administrative Agent may reasonably request;
 
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(g) as soon as available but in any event within thirty (30) days after the end of each Fiscal Month (or, during an Enhanced Reporting Trigger Period, weekly, no later than the second Business Day of each week for the prior week) and at such other times as may be requested by the Administrative Agent, the following as of the period then ended, all delivered electronically in a text formatted file reasonably acceptable to the Administrative Agent:
(i) a summary aging of the Borrower’s Receivables, including all invoices aged by invoice date and due date (with an explanation of the terms offered relating to the number of days between the invoice date and the due date), prepared in a manner reasonably acceptable to the Administrative Agent, together with a summary specifying the name, address, and balance due for each Obligor;
(ii) a worksheet of calculations prepared by the Borrower to determine Eligible Receivables, such worksheets detailing the Receivables excluded from Eligible Receivables and the reason for such exclusion;
(iii) a reconciliation of the Borrower’s Receivables between (A) the amounts shown in the Borrower’s general ledger and financial statements and the report delivered pursuant to clause (i) above and (B) the amounts and dates shown in the report delivered pursuant to clause (i) above and the Borrowing Base Certificate delivered pursuant to clause (f) above as of such date; and
(iv) a reconciliation of the loan balance per the Borrower’s general ledger to the loan balance under this Agreement;
(h) as soon as available but in any event within thirty (30) days after the end of each Fiscal Month and at such other times as may be reasonably requested by the Administrative Agent, as of the Fiscal Month (or week, as applicable) then ended, a schedule and aging of the Borrower’s accounts payable, delivered electronically in a text formatted file reasonably acceptable to the Administrative Agent;
(i) as may be reasonably requested by the Administrative Agent, an updated list of Obligors which list shall state the Obligor’s name, mailing address and phone number, delivered electronically in a text formatted file acceptable to the Administrative Agent and certified as true and correct by a Financial Officer;
(j) promptly upon the Administrative Agent’s reasonable request:
(i) copies of invoices issued by the Borrower in connection with any Receivables, credit memos, shipping and delivery documents, and other information related thereto; and
(ii) a schedule detailing the balance of all intercompany accounts of AXE, Anixter, and the Subsidiaries of Anixter;
(k) as soon as available but in any event within thirty (30) days after the end of each Fiscal Month (or, during an Enhanced Reporting Trigger Period, weekly, no later than the second Business Day or each week for the prior week) and at such other times as may be requested by the Administrative Agent, as of the period then ended, each Originator’s sales journal, cash receipts journal (identifying trade and non-trade cash receipts) and debit memo/credit memo journal;
 
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(l) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by AXE or Anixter with the SEC, or any Governmental Authority succeeding to any or all of the functions of the SEC, or with any national securities exchange, or distributed by AXE to its shareholders generally; and
(m) promptly following any request therefor, such other information regarding the operations, business affairs or financial condition of Anixter or any Subsidiary of Anixter, the Collateral, or compliance with the terms of this Agreement, as the Administrative Agent or any Lender may reasonably request.
SECTION 6.02. Notices of Material Events . Anixter or the Borrower, as applicable, will furnish (or will cause to be furnished) to the Administrative Agent prompt (but in any event within any time period that may be specified below) written notice of the following:
(a) the occurrence of any Potential Amortization Event or Amortization Event;
(b) (i) receipt of any notice of any investigation by a Governmental Authority or any litigation or proceeding commenced or threatened against Anixter or any Subsidiary of Anixter that seeks damages in excess of $35,000,000 except where the same is fully covered (other than any applicable co-insurance or deductible) by insurance (other than insurance in the nature of retro-premium insurance or other self-insurance programs); (ii) receipt of any notice of any investigation or any proceeding before or by any Governmental Authority, the effect of which might be (A) to limit, prohibit, or restrict materially the manner in which Anixter or any Subsidiary of Anixter currently conducts its business and proposes to conduct its business in connection with and following the consummation of the Related Transactions, if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect, or (B) to declare any substance contained in the products manufactured or distributed by it to be dangerous, if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect; or (iii) receipt of any notice of any investigation by a Governmental Authority or any litigation or proceeding commenced or threatened against Anixter or any Subsidiary of Anixter that (A) seeks injunctive relief if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect, (B) is asserted or instituted against any Plan, its fiduciaries or its assets if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect, (C)(1) alleges criminal misconduct by the Borrower, Anixter or any Inventory Facility Loan Party or (2) alleges criminal misconduct by any Subsidiary of Anixter not described in (C)(1) if such misconduct has resulted in or could reasonably be expected to result in a Material Adverse Effect, or (D) asserts liability on the part of Anixter or any Subsidiary of Anixter in excess of $7,500,000 in respect of any tax, fee, assessment, or other governmental charge, or (E) involves any product recall if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect;
(c) any of the following that, alone or together, could reasonably be expected to result in a Material Adverse Effect: (i) notice that any Property of Anixter or any Subsidiary of Anixter is subject to an Environmental Lien, or (ii) notice to Anixter or any Subsidiary of Anixter or awareness by Anixter or any Subsidiary of Anixter of a condition that could reasonably be expected to result in (A) a notice of violation of any health or safety Requirement of Law or Environmental Law or (B) any Environmental Liability;
(d) any Lien or claim made or asserted against any of the Collateral, other than Permitted Encumbrances and Liens permitted by Section 7.02(a);
 
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(e) as soon as available, but not less than ten (10) days prior to the consummation of any acquisition or Investment proposed to be permitted by Section 7.04(a)(v), (i) notice of such proposed acquisition or proposed Investment, and (ii) a copy of all business and financial information reasonably requested by the Administrative Agent including pro forma financial statements, statements of cash flow, and Availability projections;
(f) within two (2) Business Days of receipt thereof, any and all default notices received under or with respect to any leased location or public warehouse for which (i) a chief executive office is maintained, (ii) books and records are maintained, or (iii) Collateral with a value of $5,000,000 or greater in the aggregate is located;
(g) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect;
(h) reserved ;
(i) any other development that results, or could reasonably be expected to result, in a Material Adverse Effect;
(j) any termination of the obligation of any Originator (other than the Seller) to sell Receivables to the Seller under the related Receivables Transfer Agreement or the obligation of the Seller to sell Receivables to the Borrower under the Receivables Sale Agreement and, upon any such termination, the Outstanding Balance of all Receivables originated by such other Originator or the Seller as of the last day of the Fiscal Month then most recently ended;
(k) at least ten (10) days prior to any proposed change of the sole (or, as applicable, the sole remaining) Independent Director for any reason other than death, incapacity or resignation of the incumbent director, notice of such proposed change together with a certificate of the Borrower certifying that the proposed replacement director satisfies the criteria set forth in the definition of “Independent Director” and requesting the Administrative Agent’s written acknowledgement that in its reasonable judgment, the designated replacement satisfies such criteria. As soon as reasonably practicable but in any event within ten (10) days after the Borrower receives notice of the death, incapacity or resignation of the sole (or, as applicable, the sole remaining) incumbent Independent Director, notice of the proposed replacement director together with a certificate of the Borrower certifying that the proposed replacement director satisfies the criteria set forth in the definition of “Independent Director” and requesting the Administrative Agent’s written acknowledgement that in its reasonable judgment, the designated replacement satisfies such criteria;
(l) at least thirty (30) days prior to the effectiveness of any material change in or material amendment to any Credit and Collection Policy, a notice (i) indicating such change or amendment, and (ii) if such proposed change or amendment would reasonably be expected to adversely affect the collectability of the Receivables or decrease the credit quality of any newly created Receivables, requesting the consent of the Administrative Agent to such proposed change or amendment; provided that if such change or amendment was required pursuant to any change in any applicable law, rule or regulation, the Borrower shall only be required to give notice of such change or amendment and shall not be required to request the consent of the Administrative Agent; or
(m) any notice, request for consent, financial statements, certification, report or other communication under or in connection with any Related Transaction Document from any Collection Bank, with copies of the same.
 
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Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer or other executive officer of Anixter setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
SECTION 6.03. Existence; Conduct of Business .
The Borrower will, and Anixter will and will cause each of its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, qualifications, licenses, permits, franchises, governmental authorizations, intellectual property rights, licenses and permits material to the conduct of its business, and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted, except in those jurisdictions where the failure to do so could not reasonably be expected to result in a Material Adverse Effect and provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 7.03. Following the end of each Fiscal Quarter, Anixter shall promptly provide the Administrative Agent and each of the Lenders with a complete list of its Subsidiaries, including any changes in the list set forth on Schedule 4.15 with respect to Subsidiaries having assets in excess of $1,000,000 individually or $5,000,000 in the aggregate.
SECTION 6.04. Payment of Obligations . The Borrower will, and Anixter will and will cause each of its Subsidiaries to, pay or discharge (a) all material Taxes imposed upon it or any of its properties or assets or in respect of any of its franchises, business, income, or property before any penalty or interest accrues (including the Receivables, exclusive of taxes on or measured by income or gross receipts of the Administrative Agent or any Lender) thereon, and (b) all material claims (including claims for labor, services, materials and supplies) for sums which have become due and payable and which by law have or may become a Lien (other than a Customary Permitted Lien) upon any of its properties or assets, prior to the time when any penalty or fine shall be incurred with respect thereto; provided , however , that (i) no such Taxes referred to in clause (a) above or no such claim referred to in clause (b) above need to be paid or discharged where the validity or amount thereof is being contested in good faith by appropriate proceedings and such Person has set aside on its books adequate reserves with respect thereto in accordance with GAAP, and (ii) the Borrower will, and Anixter will and will cause each of its Subsidiaries to, remit withholding taxes and other payroll taxes to appropriate Governmental Authorities as and when claimed to be due, notwithstanding the foregoing exceptions.
SECTION 6.05. Maintenance of Properties . The Borrower will, and Anixter will and will cause each of its Subsidiaries to, keep and maintain all property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted.
SECTION 6.06. Books and Records; Inspection Rights and Audits . The Borrower will, and Anixter will and will cause each of its Subsidiaries to, (a) keep proper books of record and account with respect to the Collateral, (including a system of accounting established and administered in accordance with sound business practices and consistent with past practice to permit preparation of financial statements in conformity with GAAP and, if required by the terms of this Agreement, in conformity with Agreement Accounting Principles, and each of the financial statements described in Section 6.01 shall be prepared from such system and records), in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities and (b) permit any representatives designated by the Administrative Agent or any Lender (including employees of the Administrative Agent, any Lender or any consultants, accountants, lawyers, agents and appraisers retained by the Administrative Agent), upon reasonable prior notice, to visit and inspect its properties, to conduct at such Person’s premises field examinations of such Person’s assets, liabilities, books and records, including examining and making extracts from its books and records, environmental assessment reports, and to discuss its affairs, finances and condition with its officers and independent accountants, all
 
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at such reasonable times and as often as reasonably requested (each such visit, a “ Review ”). Only one (1) field examination per year will be conducted at the Borrower’s sole cost and expense; provided that a second field examination may be performed at the Borrower’s sole cost and expense if Combined Availability falls below the greater of (i) $93,750,000 and (ii) 12.5% of the Combined Commitment; provided further , that there shall be no limitation on the number or frequency of field examinations at the Borrower’s sole cost and expense if an Amortization Event shall have occurred and be continuing. The Borrower and Anixter, for itself and on behalf of its Subsidiaries, acknowledge that the Administrative Agent, after exercising its rights of inspection, may prepare and distribute to the Lenders certain Reports pertaining to such Person’s assets for internal use by the Administrative Agent and the Lenders. For the avoidance of doubt, in no event shall the Borrower or any member of the Consolidated Group be liable for any costs or expenses relating to any matter referred to in this Section other than those matters for which it is expressly provided that such matters are at the Borrower’s “sole cost and expense”, provided that the cost and expense of any appraisal and field examination described in clause (ee) of the definition of “Eligible Receivables” shall also be included as a cost and expense of the Borrower covered under this Section 6.06.
SECTION 6.07. Compliance with Laws and Material Contractual Obligations . The Borrower will, and Anixter will and will cause each of its Subsidiaries to, (a) comply with each Requirement of Law and Environmental Law applicable to it or its property and (b) perform in all material respects its obligations under material agreements to which it is a party, except, in each case, where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. The Borrower will, and Anixter will and will cause each of its Subsidiaries to, maintain in effect and enforce policies and procedures designed to ensure compliance by such Person, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.
SECTION 6.08. Use of Proceeds .
(a) The proceeds of the Loans and the Letters of Credit will be used only for general corporate purposes of the Borrower in the ordinary course of business and to pay to the Seller permitted cash purchase price payments for the Receivables purchased pursuant to the Receivables Sale Agreement. No part of the proceeds of any Loan and no Letter of Credit will be used, whether directly or indirectly, for any purpose that entails a violation of Regulation T, U or X.
(b) The Borrower will not request any Borrowing or Letter of Credit, and none of the Borrower and Anixter and its Subsidiaries shall use, and the Borrower and Anixter shall procure that the Borrower and Anixter and its Subsidiaries and its and their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (ii) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.
SECTION 6.09. Reserved .
SECTION 6.10. Insurance .
(a) Anixter will and will cause each of its Subsidiaries to, maintain with financially sound and reputable carriers having a financial strength rating of at least A- by A.M. Best Company (i) insurance in such amounts (with no greater risk retention) and against such risks (including loss or
 
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damage by fire and loss in transit; theft, burglary, pilferage, larceny, embezzlement, and other criminal activities; business interruption; and general liability) and such other hazards, as is customarily maintained by companies of established repute engaged in the same or similar businesses operating in the same or similar locations and (ii) all insurance required pursuant to the Collateral Documents. The Borrower or Anixter will furnish to the Lenders, upon request of the Administrative Agent, information in reasonable detail as to the insurance so maintained. If Anixter or its Subsidiaries fails to maintain such insurance, the Administrative Agent may arrange for such insurance, but at the expense and without any responsibility on the Administrative Agent’s part for obtaining the insurance, the solvency of the insurance companies, the adequacy of the coverage, or the collection of claims.
(b) All property insurance policies covering the Collateral are to name the Administrative Agent as lenders loss payee for the benefit of the Administrative Agent and the Lenders, as their interests may appear, in case of loss, pursuant to a standard loss payable endorsement with a standard non-contributory “lender” or “secured party” clause. All certificates of property and general liability insurance are to be delivered to the Administrative Agent, with the loss payable (but only in respect of Collateral) and additional insured endorsements in favor of Agent and shall provide for not less than thirty (30) days’ (ten (10) days’ in the case of non-payment) prior written notice to the Administrative Agent of the exercise of any right of cancellation.
(c) Upon the occurrence and during the continuance of an Amortization Event, the Administrative Agent shall have the sole right, subject to the Intercreditor Agreement, to file claims under any property and general liability insurance policies in respect of the Collateral, to receive, receipt and give acquittance for any payments that may be payable thereunder, and to execute any and all endorsements, receipts, releases, assignments, reassignments or other documents that may be necessary to effect the collection, compromise, or settlement of any claims under any such insurance policies.
SECTION 6.11. Casualty and Condemnation . Anixter will (a) furnish to the Administrative Agent prompt written notice of any casualty or other insured damage to any material portion of the Collateral or the commencement of any action or proceeding for the taking of any material portion of the Collateral or interest therein under power of eminent domain or by condemnation or similar proceeding and (b) subject to Section 6.10(c), ensure that the net proceeds of any such event (whether in the form of insurance proceeds, condemnation awards or otherwise) are collected and applied in accordance with the applicable provisions of this Agreement and the Collateral Documents to the extent applicable.
SECTION 6.12. Depository Banks . The Borrower will maintain one or more of the Lenders as its principal depository bank, including for the maintenance of operating, administrative, cash management, collection activity and other deposit accounts for the conduct of its business.
SECTION 6.13. Employee Benefit Matters . The Borrower will, and Anixter will and will cause each of its Subsidiaries to, establish, maintain and operate, all Plans in all material respects in compliance with the applicable provisions of ERISA, the Code and all other applicable laws, and the regulations and interpretations thereunder, and the respective requirements of the governing documents for such Plans. The Borrower will, and Anixter will and will cause each of its Subsidiaries and other ERISA Affiliates to, establish, maintain and operate all Foreign Employee Benefit Plans to comply in all material respects with all laws, regulations and rules applicable thereto and the respective requirements of the governing documents for such Foreign Employee Benefit Plans.
 
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SECTION 6.14. Additional Collateral; Further Assurances .
(a) The Borrower will, and Anixter will and will cause each of its Subsidiaries to, execute and deliver, or cause to be executed and delivered, to the Administrative Agent such documents, agreements and instruments, and will take or cause to be taken such further actions (including the filing and recording of financing statements and other documents and such other actions or deliveries of the type required by Section 5.01, as applicable), which may be required by any Requirement of Law or which the Administrative Agent may, from time to time, reasonably request to carry out the terms and conditions of this Agreement and the other Loan Documents and to ensure perfection and priority of the Liens created or intended to be created by the Collateral Documents, all in form and substance reasonably satisfactory to the Administrative Agent and all at the expense of the Borrower.
(b) If any assets are acquired by the Borrower after the Effective Date (other than assets constituting Collateral under the Security Agreement that become subject to the Lien under the Security Agreement upon acquisition hereof), the Borrower will (i) notify the Administrative Agent and the Lenders thereof, and, if requested by the Administrative Agent or the Required Lenders, cause such assets to be subjected to a Lien securing the Secured Obligations and (ii) take, and cause each applicable Person to take, such actions as shall be necessary or reasonably requested by the Administrative Agent to grant and perfect such Liens, all at the sole expense of the Borrower.
(c) At any time during any Cash Dominion Trigger Period, the Administrative Agent may, or the Administrative Agent may direct the Borrower or the Servicer to, notify the Obligors of the Receivables, at the Borrower’s expense, of the security interests of the Administrative Agent (on behalf of the Lenders) under this Agreement and may also direct that payments of all amounts due or that become due under any or all Receivables be made directly to the Administrative Agent or its designee. The Borrower or the Servicer (as applicable) shall, at any Lender’s request, withhold the identity of such Lender in any such notification.
SECTION 6.15. Keeping and Marking of Records and Books .
(a) The Servicer will, or will cause each Originator to, maintain and implement administrative and operating procedures (including an ability to recreate records evidencing Receivables in the event of the destruction of the originals thereof), and keep and maintain all documents, books, records and other information reasonably necessary or advisable for the collection of all Receivables (including records adequate to permit the identification of each new Receivable and all Collections of and adjustments to each existing Receivable within two (2) Business Days of the receipt of such Collection or adjustment in respect of such Receivable). The Servicer will and will require each Originator to give the Administrative Agent and each Lender notice of any material change in the administrative and operating procedures referred to in the previous sentence.
(b) The Borrower will require the Seller to (i) on or prior to the date hereof, make a notation in its books and records stating that the Receivables have been sold to the Borrower and pledged to the Administrative Agent, and (ii) upon the request of the Administrative Agent following the occurrence and during the continuation of an Amortization Event, deliver to the Administrative Agent all invoices included in the Contracts (including all multiple originals of any such invoice) relating to the Receivables.
SECTION 6.16. Compliance with Contracts and Credit and Collection Policy . Each of Anixter and the Borrower will timely and fully (a) perform and comply in all material respects with all provisions, covenants and other promises required to be observed by it under the Contracts related to the Receivables, and (b) comply in all material respects with the applicable Credit and Collection Policy in regard to each Receivable and the related Contract.
 
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SECTION 6.17. Performance and Enforcement of the Receivables Sale Agreement . Each of Anixter and the Borrower will perform each of their respective obligations and undertakings under and pursuant to the Receivables Sale Agreement, will sell and purchase Receivables thereunder in strict compliance with the terms thereof and will vigorously enforce the rights and remedies accorded to the Borrower under the Receivables Sale Agreement. The Borrower will take all actions to perfect and enforce its rights and interests (and the rights and interests of the Administrative Agent and the Lenders as assignees of the Borrower) under the Receivables Sale Agreement and each Receivables Transfer Agreement as the Administrative Agent may from time to time reasonably request, including making claims to which it may be entitled under any indemnity, reimbursement or similar provision contained in the Receivables Sale Agreement and each Receivables Transfer Agreement.
SECTION 6.18. Ownership of Receivables; Security Interest in Receivables . Each of Anixter and the Borrower will take all necessary action to (a) establish and maintain, irrevocably in the Borrower, legal and equitable title to the Receivables, and all Related Security and Collections with respect thereto, in each case free and clear of any Lien other than Liens described under clause (a) of the definition of Customary Permitted Liens, Liens described under Section 7.02(a)(x) and Liens in favor of the Administrative Agent for the benefit of the Lenders (including the filing of all financing statements or other similar instruments or documents necessary under the UCC (or any comparable law) of all appropriate jurisdictions to perfect the Borrower’s interest in the Receivables, and all Related Security and Collections with respect thereto, and such other action to perfect, protect or more fully evidence the interest of the Borrower (and the Administrative Agent and the Lenders, as the Borrower’s assignees) as the Borrower (or the Administrative Agent, as the Borrower’s assignee) may reasonably request), and (b) establish and maintain, in favor of the Administrative Agent, for the benefit of the Lenders, a valid and perfected first priority security interest in the Collateral to the full extent contemplated herein, free and clear of any Lien other than Liens described in Section 7.02(a)(i) and Section 7.02(a)(x) and under clause (a) of the definition of Customary Permitted Liens (including the filing of all financing statements or other similar instruments or documents necessary under the UCC (or any comparable law) of all appropriate jurisdictions to perfect the Administrative Agent’s (for the benefit of the Lenders) interest in the Collateral and such other action to perfect, protect or more fully evidence the interest of the Administrative Agent for the benefit of the Lenders as the Administrative Agent may reasonably request).
SECTION 6.19. Separateness . The Borrower acknowledges that the Administrative Agent and the Lenders are entering into the transactions contemplated by this Agreement in reliance upon the Borrower’s identity as a legal entity that is separate from Anixter and its other Affiliates (each, a “ Related Entity ” ). Therefore, from and after the date of execution and delivery of this Agreement, the Borrower shall take all reasonable steps, including all steps that the Administrative Agent or any Lender may from time to time reasonably request, to maintain the Borrower’s identity as a separate legal entity and to make it manifest to third parties that the Borrower is an entity with assets and liabilities distinct from those of the Related Entities and not just a division of any Related Entity. Without limiting the generality of the foregoing and in addition to the other covenants set forth herein, except as herein specifically otherwise provided, the Borrower will:
(a) conduct its own business in its own name and require that all full-time employees of the Borrower, if any, identify themselves as such and not as employees of any Related Party (including by means of providing appropriate employees with business or identification cards identifying such employees as the Borrower’s employees);
(b) compensate all employees, consultants and agents directly, from the Borrower’s own funds, for services provided to the Borrower by such employees, consultants and agents and, to the extent any employee, consultant or agent of the Borrower is also an employee, consultant or agent of any Related Party, allocate the compensation of such employee, consultant or agent between the Borrower and such Related Party on a basis that reflects the services rendered to the Borrower and such Related Party;
 
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(c) clearly identify its offices (by signage or otherwise) as its offices and, if such office is located in the offices of any Related Party, the Borrower shall lease such office at a fair market rent;
(d) have a separate telephone number, which will be answered only in its name and separate stationery, invoices and checks in its own name;
(e) conduct all transactions with each Related Party (including any delegation of its obligations hereunder as servicer) strictly on an arm’s-length basis, allocate all overhead expenses (including telephone and other utility charges) for items shared between the Borrower and such Related Party on the basis of actual use to the extent practicable and, to the extent such allocation is not practicable, on a basis reasonably related to actual use;
(f) at all times have a Board of Directors consisting of three (3) directors, at least one director of which is an Independent Director;
(g) observe all corporate formalities as a distinct entity, and ensure that all corporate actions relating to (i) the selection, maintenance or replacement of the Independent Director, (ii) the dissolution or liquidation of the Borrower or (iii) the initiation of, participation in, acquiescence in or consent to any bankruptcy, insolvency, reorganization or similar proceeding involving the Borrower, are duly authorized by unanimous vote of its Board of Directors (including the Independent Director);
(h) maintain the Borrower’s books and records separate from those of each Related Party and otherwise readily identifiable as its own assets rather than assets of any Related Party;
(i) prepare its financial statements separately from those of each Related Party and insure that any consolidated financial statements of any Related Party that include the Borrower and that are filed with the Securities and Exchange Commission or any other governmental agency have notes clearly stating that the Borrower is a separate corporate entity and that its assets will be available first and foremost to satisfy the claims of the creditors of the Borrower;
(j) except as herein specifically otherwise provided, maintain the funds or other assets of the Borrower separate from, and not commingled with, those of any Related Party and only maintain bank accounts or other depository accounts to which the Borrower alone is the account party, into which the Borrower alone makes deposits and from which the Borrower alone (or the Administrative Agent) has the power to make withdrawals;
(k) pay all of the Borrower’s operating expenses from the Borrower’s own assets (except for certain payments by any Related Party pursuant to allocation arrangements that comply with the requirements of this Section 6.19);
(l) operate its business and activities such that it does not engage in any business or activity of any kind, or enter into any transaction or indenture, mortgage, instrument, agreement, contract, lease or other undertaking, other than the transactions contemplated and authorized by this Agreement and the Receivables Sale Agreement; and does not create, incur, guarantee, assume or suffer to exist any indebtedness or other liabilities, whether direct or contingent, other than (i) as a result of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business, (ii) the incurrence of obligations under this Agreement and the other Loan Documents, (iii) the incurrence of obligations, as expressly contemplated in the Receivables Sale Agreement, to make
 
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payment to the Seller thereunder for the purchase of Receivables from the Seller under the Receivables Sale Agreement, and (iv) the incurrence of operating expenses in the ordinary course of business of the type otherwise contemplated by this Agreement;
(m) maintain its corporate charter in conformity with this Agreement, such that (i) it does not amend, restate, supplement or otherwise modify its Organization Documents in any respect that would impair its ability to comply with the terms or provisions of any of the Related Transactions Documents, including this Section 6.19; and (ii) its corporate charter, at all times that this Agreement is in effect, provides for not less than ten (10) days’ prior written notice to the Administrative Agent of the replacement or appointment of any director that is to serve as an Independent Director for purposes of this Agreement and the condition precedent to giving effect to such replacement or appointment that the Borrower certify that the designated Person satisfied the criteria set forth in the definition herein of “Independent Director” and the Administrative Agent’s written acknowledgement that in its reasonable judgment the designated Person satisfies the criteria set forth in the definition herein of “Independent Director”;
(n) maintain the effectiveness of, and continue to perform under the Receivables Sale Agreement, such that it does not amend, restate, supplement, cancel, terminate or otherwise modify the Receivables Sale Agreement, or give any consent, waiver, directive or approval thereunder (including any consent, waiver, directive or approval in connection with any Receivables Transfer Agreement) or waive any default, action, omission or breach under the Receivables Sale Agreement or any Receivables Transfer Agreement or otherwise grant any indulgence thereunder, without (in each case) the prior written consent of the Administrative Agent;
(o) maintain its corporate separateness such that it does not merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of (whether in one transaction or in a series of transactions, and except as otherwise contemplated herein) all or substantially all of its assets (whether now owned or hereafter acquired) to, or acquire all or substantially all of the assets of, any Person, nor at any time create, have, acquire, maintain or hold any interest in any Subsidiary; and
(p) maintain at all times the Required Capital Amount (as defined in the Receivables Sale Agreement) and refrain from making any dividend, distribution, redemption of capital stock or payment of any subordinated indebtedness which would cause the Required Capital Amount to cease to be so maintained.
SECTION 6.20. Collections . The Borrower will cause (a) all proceeds from all Lock-Boxes to be directly deposited by a Collection Bank into a Collection Account and (b) each Lock-Box and Collection Account to be subject at all times to a Collection Account Agreement that is in full force and effect. In the event any payments relating to the Receivables are remitted directly to the Borrower or any Affiliate of the Borrower, the Borrower will remit (or will cause all such payments to be remitted) directly to a Collection Bank and deposited into a Collection Account within two (2) Business Days following receipt thereof, and, at all times prior to such remittance, the Borrower will hold (or will cause such payments to be held) in trust for the exclusive benefit of the Administrative Agent and the Lenders, subject to the Servicer’s rights under Section 8.02. The Servicer shall maintain exclusive ownership, dominion and control (subject to the terms of this Agreement and the applicable Collection Account Agreement) of each Lock-Box and each Collection Account and shall ensure that no right to take dominion and control of any Lock-Box or Collection Account is granted at a future time or upon the occurrence of a future event to any Person except to the Administrative Agent as contemplated by this Agreement and the Related Transactions Documents.
 
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SECTION 6.21. Payments to the Originators . Anixter shall cause the Seller to purchase all Receivables from any other Originator under, and in strict compliance with the terms of, the related Receivables Transfer Agreement, including the terms relating to the amount and timing of payments to be made to such Originator in respect of the purchase price for each Receivable. The Borrower will purchase all Receivables from the Seller under, and in strict compliance with the terms of, the Receivables Sale Agreement, including the terms relating to the amount and timing of payments to be made to the Seller in respect of the purchase price for each Receivable.
SECTION 6.22. Post-Closing Security Perfection . The Borrower will deliver or cause to be delivered such documents and instruments, and take or cause to be taken such other actions as may be reasonably necessary to provide the perfected security interests described in Section 5.01(m) that are not so provided on the Effective Date, and in any event to provide such perfected security interests and to satisfy such other conditions within the applicable time periods set forth on Schedule 6.22 , as such time periods may be extended by the Administrative Agent, in its sole discretion.
ARTICLE VII
Negative Covenants
Until the Commitments shall have expired or been terminated and the principal of and interest on each Loan and all fees, expenses and other amounts payable under any Loan Document shall have been paid in full and all Letters of Credit shall have expired or terminated, in each case without any pending draw, and all LC Disbursements shall have been reimbursed, Anixter, in its capacity as the Servicer, and the Borrower covenants and agrees with the Administrative Agent and the Lenders that:
SECTION 7.01. Indebtedness .
(a) Anixter will not permit any member of the Consolidated Group to, create, incur, assume or suffer to exist any Indebtedness, except:
(i) the Secured Obligations;
(ii) Indebtedness existing on the date hereof and set forth in Schedule 7.01 and any extensions, renewals, refinancings and replacements of any such Indebtedness in accordance with clause (xiii) hereof;
(iii) Indebtedness in respect of Accommodation Obligations permitted by Section 7.04(b);
(iv) (A) Indebtedness of the Borrower to Anixter arising under Receivables Facility Transactions, provided that such Indebtedness shall be subordinated to the Secured Obligations on terms reasonably satisfactory to the Administrative Agent; and (B) unsecured Indebtedness of Anixter to any Subsidiary of Anixter (other than the Borrower) and of any Subsidiary of Anixter (other than the Borrower) to Anixter or any other Subsidiary of Anixter (other than the Borrower), provided that (1) Indebtedness of any Subsidiary that is not an Inventory Facility Loan Party to Anixter or any other Inventory Facility Loan Party shall be subject to clause (ix) of Section 7.04(a), and (2) Indebtedness of any Inventory Facility Loan Party to any Subsidiary of Anixter that is not an Inventory Facility Loan Party shall be subordinated to the Secured Obligations on terms reasonably satisfactory to the Administrative Agent;
 
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(v) other unsecured debt of Anixter subordinated in right of payment with the Secured Obligations on terms and conditions satisfactory to the Administrative Agent;
(vi) other unsecured Indebtedness of Anixter’s Subsidiaries that are Inventory Facility Guarantors subordinated on terms and conditions satisfactory to the Administrative Agent in right of payment with the Secured Obligations;
(vii) Indebtedness of Anixter or any of its Subsidiaries incurred to finance the acquisition, construction or improvement of any fixed or capital assets (whether or not constituting purchase money Indebtedness), including obligations under Capital Leases and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and extensions, renewals and replacements of any such Indebtedness in accordance with clause (xiii) below; provided that (A) such Indebtedness is incurred prior to or within ninety (90) days after such acquisition or the completion of such construction or improvement and (B) the aggregate principal amount of Indebtedness permitted by this clause together with any Refinance Indebtedness in respect thereof permitted by clause (xiii) below, shall not exceed $50,000,000 at any time outstanding;
(viii) Indebtedness of one or more of Anixter and its Subsidiaries under the Inventory Facility;
(ix) unsecured Indebtedness of Anixter in an aggregate principal amount of up to $500,000,000 evidenced by certain senior unsecured notes and incurred in connection with, and for the purpose of financing a portion of the consideration payable in connection with, the consummation of the HD Supply Acquisition;
(x) Indebtedness of Anixter Canada in an aggregate principal amount of up to CAD 300,000,000 in the form of a term loan incurred in connection with, and for the purpose of financing portion of the consideration payable in connection with, the consummation of the HD Supply Acquisition;
(xi) Indebtedness (including Indebtedness represented by letters of credit) of Anixter Canada in an aggregate principal amount of up to CAD 50,000,000 in the form of a revolving credit facility incurred for working capital and other general corporate purposes;
(xii) Indebtedness (including Indebtedness represented by letters of credit) of Foreign Subsidiaries of Anixter (other than Anixter Canada) in an aggregate principal amount of up to $150,000,000 incurred for working capital and other general corporate purposes;
(xiii) Indebtedness which represents extensions, renewals, refinancing or replacements (such Indebtedness being so extended, renewed, refinanced or replaced being referred to herein as the “ Refinance Indebtedness ”) of any of the Indebtedness described in clauses (ii) and (vii) hereof (such Indebtedness being referred to herein as the “ Original Indebtedness ”); provided that (A) such Refinance Indebtedness does not increase the principal amount (except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing and by an amount equal to any existing commitments unutilized thereunder) or interest rate of the Original Indebtedness, (B) any Liens securing such Refinance Indebtedness are not extended to any additional property of Anixter or any of its Subsidiaries, (C) neither Anixter nor any Subsidiary of Anixter, as the case may be, that was not originally obligated with respect to repayment of such Original Indebtedness is required to become obligated with respect to such Refinance Indebtedness, (D) such Refinance
 
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Indebtedness does not result in a shortening of the average weighted maturity of such Original Indebtedness, (E) the terms of such Refinance Indebtedness are not materially less favorable to the obligor thereunder than the original terms of such Original Indebtedness (other than changes in the interest rates applicable thereto to reflect current market conditions) and (F) if such Original Indebtedness was subordinated in right of payment to the Obligations, then the terms and conditions of such Refinance Indebtedness must include subordination terms and conditions that are at least as favorable to the Administrative Agent and the Lenders as those that were applicable to such Original Indebtedness;
(xiv) Indebtedness under Swap Agreements permitted under Section 7.07; and
(xv) Indebtedness of Anixter and any other member of the Consolidated Group owing to Bank Mendes Gans N.V. (or any successor thereto) in an aggregate amount not at any time to exceed the aggregate amount on deposit by the Consolidated Group with Bank Mendes Gans N.V. (or any successor thereto) at such time.
(b) Notwithstanding anything to the contrary contained in Section 7.01(a), Anixter will not, and will not permit any of its applicable Subsidiaries to, create or incur any Specified Secured Debt unless (i) after giving effect to the creation or incurrence of such Specified Secured Debt, the pro forma Secured Debt-to-CTNA Ratio would not be 10% or greater, and (ii) not later than five (5) Business Days prior to any proposed creation or incurrence of Specified Secured Debt, Anixter furnishes (or causes to be furnished) to the Administrative Agent written notice of such proposed creation or incurrence of Specified Secured Debt and a certificate of a Financial Officer of Anixter certifying compliance with this Section 7.01(b) and attaching pro forma computations of the Secured Debt-to-CTNA Ratio before and after giving effect to such proposed creation or incurrence of Specified Secured Debt.
(c) Notwithstanding anything to the contrary contained in this Section 7.01, the Borrower will not create, incur, assume or suffer to exist any Indebtedness, except (i) Indebtedness owed to the Administrative Agent and the Lenders under this Agreement, (ii) Indebtedness evidenced by the Borrower Subordinated Note, and (iii) Indebtedness incurred as a result of the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business.
SECTION 7.02. Liens .
(a) Anixter will not permit any member of the Consolidated Group to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including Receivables) or rights in respect of any thereof, except:
(i) Liens created pursuant to any Loan Document;
(ii) Permitted Encumbrances;
(iii) any Lien on any property or asset of Anixter or any of its Subsidiaries existing on the date hereof and set forth in Schedule 7.02 ; provided that (i) such Lien shall not apply to any other property or asset of the Anixter or such Subsidiary and (ii) such Lien shall secure only those obligations which it secures on the date hereof, and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof;
(iv) Liens on fixed or capital assets acquired, constructed or improved by Anixter or any of its Subsidiaries; provided that (i) such Liens secure Indebtedness permitted by clause (vii) of Section 7.01, (ii) such Liens and the Indebtedness secured thereby are incurred prior to or
 
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within ninety (90) days after such acquisition or the completion of such construction or improvement, (iii) such Liens shall not apply to any other property or assets of Anixter or any of its Subsidiaries, and (iv) the value of the Property securing such Indebtedness approximates the amount of such Indebtedness;
(v) any Lien existing on any property or asset prior to the acquisition thereof by Anixter or any of its Subsidiaries or existing on any property or asset of any Person that is acquired in an acquisition permitted by Section 7.04(a)(v) that is consummated after the date hereof; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition, (ii) such Lien shall not apply to any other property or assets (other than additions, accessions, and improvements thereto and the proceeds and products thereof), and (iii) such Lien shall secure only those obligations which it secures on the date of such acquisition or and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof;
(vi) Liens in favor of the Inventory Facility Administrative Agent arising in connection with and securing the Indebtedness under the Inventory Facility permitted by clause (viii) of Section 7.01(a);
(vii) Liens arising in connection with and securing Indebtedness permitted by clauses (x), (xi), and (xii) of Section 7.01(a);
(viii) Liens on assets of any joint venture described in Section 7.04(vi);
(ix) Liens on the assets of Foreign Subsidiaries of Anixter; provided that the aggregate amount of Indebtedness secured by such Liens shall not exceed the amounts set forth in the aggregate in clauses (x), (xi) and (xii) of Section 7.01(a);
(x) (i) Liens in favor of the Borrower granted by Anixter arising in connection with the Receivables Facility Transactions, and (ii) Liens in favor of Anixter granted by the Borrower arising in connection with the Receivables Facility Transactions and securing the Indebtedness permitted by Section 7.01(a)(iv)(A);
(xi) Liens not otherwise permitted hereunder in an aggregate principal amount not to exceed $10,000,000 at any time outstanding; and
(xii) (A) Liens securing “Swap Obligations” under and as defined in the Inventory Facility Credit Agreement; and (B) Liens securing obligations under other Swap Agreements permitted by Section 7.07, so long as the underlying assets securing such obligations are assets of one or more Foreign Subsidiaries.
(b) Notwithstanding the foregoing, Anixter will not create or suffer to exist any mortgage, pledge, security interest, encumbrance, lien, charge or other similar arrangement on any of its inventory, the sale or lease of which would give rise to a Receivable other than as permitted pursuant to the Inventory Facility.
(c) Notwithstanding anything to the contrary contained in this Section 7.02, the Borrower will not sell, assign (by operation of law or otherwise) or otherwise dispose of, or grant any option with respect to, or create or suffer to exist any Lien upon (including the filing of any financing statement) or with respect to, any Receivable, or the Related Security or Collections with respect thereto, or upon or with respect to any related Contract, or any Lock-Box, Collection Account, or any Company Owned Post
 
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Office Box, or assign any right to receive income with respect thereto (other than, in each case, Liens described in Section 7.02(a)(i) and Section 7.02(a)(x) and under clause (a) of the Customary Permitted Liens), and the Borrower will defend the right, title and interest of the Administrative Agent and the Lenders in, to and under any of the foregoing property, against all claims of third parties claiming through or under the Borrower or any Originator.
SECTION 7.03. Fundamental Changes .
(a) Notwithstanding anything to the contrary contained in this Section 7.03, the Borrower will not merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or liquidate or dissolve.
(b) Anixter will not, and will not permit any member of the Consolidated Group to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or liquidate or dissolve, except (i) as otherwise permitted under Section 7.05, and (ii) that if at the time thereof and immediately after giving effect thereto no Amortization Event shall have occurred and be continuing any Subsidiary of Anixter (other than the Borrower) may merge into Anixter or another Subsidiary of Anixter (other than the Borrower); provided that any such merger involving a Person that is not a wholly owned Subsidiary immediately prior to such merger shall not be permitted unless also permitted by Section 7.04.
(c) Anixter will not permit any member of the Consolidated Group to, acquire by purchase or otherwise any property or assets of, or stock or other evidence of beneficial ownership of, any Person, except in the ordinary course of its business or to the extent permitted pursuant to Section 7.04(a). Notwithstanding anything to the contrary contained in this Section 7.03, the Borrower will not acquire by purchase or otherwise any property or assets of, or stock or other evidence of beneficial ownership of, any Person, other than as contemplated by Section 6.19.
(d) Anixter will not, and will not permit any member of the Consolidated Group to, engage to any material extent in, any business other than businesses of the type conducted by Anixter and its Subsidiaries on the date hereof, business of the type proposed to be conducted in connection with and following the consummation of the Related Transactions, and businesses in substantially similar or related businesses thereto and reasonable extensions thereof. Notwithstanding anything to the contrary contained in this Section 7.03, the Borrower will not engage in any business or undertaking other than the transactions and undertakings expressly permitted by this Agreement or the Receivables Sale Agreement.
(e) Each of the Borrower and Anixter will not, and Anixter will not permit any member of the Consolidated Group to, change its fiscal year from the basis in effect on the Effective Date, except that any Subsidiary of Anixter may conform its fiscal year to Anixter’s Fiscal Year.
SECTION 7.04. Investments, Loans, Advances, Guarantees and Acquisitions .
(a) Anixter will not, and will not permit any member of the Consolidated Group to, directly or indirectly, make or commit to make any advance, loan, extension of credit or capital contribution, or purchase of any stock, bonds, notes, debentures or other securities or evidences of indebtedness of, or make any other investment in, any Person, including any Affiliate (each such transaction, an “ Investment ”) except:
(i) Investments by Anixter or any of its Subsidiaries in Cash Equivalents;
(ii) Investments in existence on the date hereof and described in Schedule 7.04 ;
 
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(iii) Investments arising from sales in the ordinary course of business on customary trade terms;
(iv) Investments constituting loans by Anixter or any Subsidiary of Anixter to its employees not in excess of an aggregate amount of $10,000,000 outstanding at any one time;
(v) the acquisition (in any transaction or series of related transactions) by Anixter or any of its Subsidiaries of substantially all of the assets or all of the Equity Interests of any Person, and Investments in connection with any such acquisition, in each case so long as (i) such acquisition is not a hostile or contested acquisition, (ii) the business acquired in connection with such acquisition is not engaged, directly or indirectly, in any line of business other than the businesses in which Anixter or any of its Subsidiaries are engaged on the Effective Date and any business activities that are substantially similar or related thereto, (iii) no Amortization Event exists or would result therefrom, and (iv) the Payment Conditions are satisfied;
(vi) Investments in any joint ventures and Investments in connection with the purchase of any other Person’s interest in any such joint ventures, which do not exceed $50,000,000 in the aggregate outstanding at any one time;
(vii) Investments (other than those set forth on Schedule 7.04 ) in notes receivable received in connection with transactions permitted pursuant to Section 7.04(a)(iv);
(viii) Investments by Anixter in any Subsidiary of Anixter that is an Inventory Facility Loan Party or by any Subsidiary of Anixter in Anixter;
(ix) Investments by Anixter in any Subsidiary of Anixter that is not an Inventory Facility Loan Party (other than the Borrower), in each case so long as (A) no Amortization Event exists or would result therefrom, and (B) after giving effect to the proposed Investment as if it occurred on the first day of the Pro Forma Period, pro forma Combined Availability would be greater than 15% of the Combined Commitment at all times during the Pro Forma Period;
(x) Investments constituting loans permitted by Section 7.01(a)(iv) or Accommodation Obligations permitted under Section 7.04(b);
(xi) Investments in the form of Swap Agreements permitted by Section 7.07;
(xii) investments of any Person existing at the time such Person becomes a Subsidiary of Anixter or consolidates or merges with Anixter or any of its Subsidiaries (including in connection with an acquisition permitted under Section 7.04(a)(v)) so long as such investments were not made in contemplation of such Person becoming a Subsidiary or of such merger;
(xiii) investments constituting deposits described in clause (c) of the definition of “Customary Permitted Liens”;
(xiv) Investments constituting Accommodation Obligations permitted by Section 7.04(b); and
(xv) Investments by any non-Inventory Facility Loan Party in any other non-Inventory Facility Loan Party.
 
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(b) Anixter will not, and will not permit any member of the Consolidated Group to, directly or indirectly, create or become or be liable with respect to any Accommodation Obligation involving Indebtedness of AXE or any Affiliate of AXE which is not a Subsidiary of Anixter. In addition, Anixter will not, and will not permit any member of the Consolidated Group to, directly or indirectly, create or become or be liable with respect to any Accommodation Obligation except:
(i) guaranties resulting from endorsement of negotiable instruments for collection in the ordinary course of business;
(ii) Accommodation Obligations arising in connection with the Related Transactions Documents;
(iii) Accommodation Obligations by Anixter with respect to lessees’ obligations to third-party lessors under leases of Property purchased from Anixter and its Subsidiaries, in an aggregate amount not to exceed $10,000,000;
(iv) Accommodation Obligations of Anixter and its Subsidiaries arising in connection with Swap Agreements permitted pursuant to Section 7.07;
(v) Accommodation Obligations of Anixter and its Subsidiaries of Indebtedness permitted by Section 7.01(a); and
(vi) other Accommodation Obligations by Anixter and its Subsidiaries so long as (A) the aggregate amount of Indebtedness outstanding in respect of which such Accommodation Obligation has been given does not at any time exceed $175,000,000 and (B) the Payment Conditions are satisfied; provided , however , that no such Accommodation Obligations shall be entered into or incurred after the occurrence and during the continuance of an Amortization Event.
(c) Notwithstanding anything to the contrary contained in this Section 7.04, the Borrower will not (i) make any Investment other than in Cash Equivalents, nor (ii) directly or indirectly, create or become or be liable with respect to any Accommodation Obligation except guaranties resulting from endorsement of negotiable instruments for collection in the ordinary course of business.
SECTION 7.05. Asset Sales .
(a) Anixter will not permit any member of the Consolidated Group to, sell, transfer, lease, or otherwise Dispose of any asset, including any Equity Interest owned by it, or any income or profits therefrom, except:
(i) sales, transfers and dispositions of (A) Inventory in the ordinary course of business and (B) disposition of obsolete equipment in the ordinary course of business;
(ii) sales by Anixter of Equity Interests of a Subsidiary held by it, in any transaction or series of related transactions not constituting a Material Transaction, individually or taken together;
(iii) sales, assignments, transfers, leases, conveyances or other dispositions of other assets, other than Equity Interests of any Subsidiary, for cash consideration and for not less than fair market value which do not constitute a Material Transaction individually or in the aggregate (together with all sales of Equity Interests of any Subsidiary under clause (ii) above);
 
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(iv) sales, assignments, transfers, leases, conveyances or other Dispositions of assets to Anixter or a Subsidiary of Anixter that is an Inventory Facility Loan Party;
(v) transfers of assets to any Affiliate for less than fair market value to the extent such transfer constitutes a permitted Investment pursuant to Section 7.04(a);
(vi) Receivables Facility Transactions;
(vii) sales, assignments, transfers, leases, conveyances and other Dispositions among Foreign Subsidiaries; and
(viii) Sale and Leaseback Transactions permitted by Section 7.06.
(b) Notwithstanding anything to the contrary contained in Section 7.05(a), Anixter will not, and will not permit any of its applicable Subsidiaries to, Dispose of any assets (whether in a Material Transaction or otherwise) if, after giving effect to such Disposition, the pro forma Secured Debt-to-CTNA Ratio would be 10% or greater. No later than five (5) Business Days prior to any proposed Disposition of assets, Anixter will furnish (or will caused to be furnished) to the Administrative Agent and each Lender written notice of such proposed Disposition and a certificate of a Financial Officer of Anixter certifying compliance with this Section 7.05(b) and attaching pro forma computations of Secured Debt-to-CTNA Ratio before and after giving effect to such proposed Disposition.
(c) Notwithstanding anything to the contrary contained in this Section 7.05, the Borrower will not sell, transfer, lease or otherwise Dispose of any asset owned by it, or any income or profits therefrom except as contemplated by the Receivables Facility Transaction Documents.
SECTION 7.06. Sale and Leaseback Transactions .
(a) Anixter will not, and will not permit any member of the Consolidated Group to, enter into any arrangement, directly or indirectly, whereby it shall sell or transfer any property, real or personal, used or useful in its business, whether now owned or hereafter acquired, and thereafter rent or lease such property or other property that it intends to use for substantially the same purpose or purposes as the property sold or transferred (a “ Sale and Leaseback Transaction ”), except for any such sale of any fixed or capital assets by Anixter or any Subsidiary that is made for cash consideration in an amount not less than the fair value of such fixed or capital asset and is consummated within 365 days after Anixter or such Subsidiary acquires or completes the construction of such fixed or capital asset.
(b) Notwithstanding anything to the contrary contained in this Section 7.06, the Borrower will not enter into any Sale and Leaseback Transaction.
SECTION 7.07. Swap Agreements .
(a) Anixter will not permit any member of the Consolidated Group to, enter into any Swap Agreement, except (a) Swap Agreements entered into to hedge or mitigate risks to which such Person has actual exposure (other than those in respect of Equity Interests of any Subsidiary), and (b) Swap Agreements entered into in order to effectively cap, collar or exchange interest rates (of Anixter floating to fixed rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment of such Person.
(b) Notwithstanding anything to the contrary contained in this Section 7.07, the Borrower will not enter into any Swap Agreement.
 
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SECTION 7.08. Payments to AXE and Anixter; Certain Payments of Indebtedness .
(a) Anixter will not declare or make, directly or indirectly, any payment, distribution or contribution to or investment in AXE (whether in cash or otherwise), and Anixter will not permit any member of the Consolidated Group to, declare or make, directly or indirectly, make any payment, distribution or contribution to or investment in AXE (whether in cash or otherwise), except:
(i) Anixter and its Subsidiaries may declare and make payments to AXE so that AXE may pay any directors’ fees and reasonable allocated expenses in an aggregate amount not to exceed $7,500,000 during any Fiscal Year;
(ii) Anixter and its Subsidiaries may make payments to AXE (A) that are applied by AXE to pay its actual income tax liabilities in respect of income earned by Anixter and its Subsidiaries, or (B) that are applied by AXE to make any cash settlements to management or employees under equity awards consistent with its past practice not in excess of $7,500,000 in the aggregate during any calendar year; and
(iii) Anixter and its Subsidiaries may make any other payment, distribution or contribution to or investment in AXE (whether in cash or otherwise), in each case so long as (A) no Amortization Event exists or would result therefrom, and (B) the Payment Conditions are satisfied.
(b) Anixter will not, and will not permit any Inventory Facility Loan Party to, make or agree to pay or make, directly or indirectly, any payment or other distribution (whether in cash, securities or other property) of or in respect of principal of or interest on any Indebtedness, or any payment or other distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Indebtedness, except:
(i) payment of Indebtedness created under the Loan Documents;
(ii) (A) payments of interest and principal (including prepayments) in respect of the Indebtedness under the Inventory Facility and permitted under clause (viii) of Section 7.01(a), (B) payments of interest and principal (including prepayments) by the Borrower to Anixter in respect of the Indebtedness of the Borrower to Anixter arising under Receivables Facility Transactions and permitted under clause (iv)(A) of Section 7.01(a) and (C) payment of regularly scheduled interest and principal payments as and when due in respect of any other Indebtedness permitted under Section 7.01, other than payments in respect of the Subordinated Indebtedness prohibited by the subordination provisions thereof;
(iii) refinancings of Indebtedness to the extent permitted by Section 7.01;
(iv) payment of secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness to the extent such sale or transfer is permitted by the terms of Section 7.05; and
(v) any other payments in respect of any Indebtedness, in each case, so long as (A) no Amortization Event exists or would result therefrom, and (B) the Payment Conditions are satisfied.
 
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(c) Notwithstanding anything to the contrary contained in this Section 7.08, the Borrower will not declare or make, directly or indirectly, any payment, distribution or contribution to or investment in Anixter if an Amortization Event or a Potential Amortization Event has occurred and is continuing or would result therefrom or if after giving pro forma effect thereto, the Borrower would not be in compliance with Section 7.14(b).
(d) Notwithstanding anything to the contrary contained in this Section 7.08, the Borrower will not make or agree to pay or make, directly or indirectly, any payment or other distribution (whether in cash, securities or other property of or in respect of principal of or interest on any Indebtedness, or any payment or distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or terminate any Indebtedness, except:
(i) payment of Indebtedness created under the Loan Documents;
(ii) payments of interest and principal (including prepayments) by the Borrower to Anixter in respect of the Indebtedness of the Borrower to Anixter arising under Receivables Facility Transactions;
SECTION 7.09. Transactions with Affiliates . Anixter will not, and will not permit any Inventory Facility Loan Party to, directly or indirectly enter into or permit to exist any transaction (including any sale, lease or other transfer of any property or assets, any purchase, lease or other acquisition of any property or assets, or the rendering of any service) with any Affiliate of Anixter that is not an Inventory Facility Loan Party that involves one or more payments to such Affiliate in excess of $5,000,000 for any single transaction or series of related transactions on terms that are less favorable to it than those fair and reasonable terms that might be obtained in a comparable arms-length transaction at the time (other than payments to AXE permitted pursuant to Section 7.08(a)); provided that the foregoing shall not restrict transactions among Foreign Subsidiaries. Notwithstanding anything to the contrary contained in this Section 7.09, the Borrower will not enter into or permit to exist any transaction (including any sale, lease, or other transfer of any property or assets, any purchase, lease, or other acquisition of any property or assets, or the rendering of any service) with any Person, except as specifically permitted under the Receivables Facility Transactions.
SECTION 7.10. Restrictive Agreements .
(a) Anixter will not, and will not permit any Inventory Facility Loan Party to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of such Person to create, incur, or permit to exist any Lien upon any of its property or assets, or (b) the ability of any Subsidiary of Anixter to pay dividends or other distributions with respect to any of its Equity Interests or to make or repay loans or advances to Anixter or any other Subsidiary or to guarantee Indebtedness of Anixter or any other Subsidiary; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by any Requirement of Law or by any Loan Document, (ii) the foregoing shall not apply to restrictions and conditions existing on the date hereof identified on Schedule 7.10 (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided that such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iv) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, and (v) clause (a) of the foregoing shall not apply to customary provisions in leases and other contracts restricting the assignment thereof.
 
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(b) Notwithstanding anything to the contrary contained in this Section 7.10, the Borrower will not directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower to create, incur, or permit to exist any Lien upon any of its property or assets, or (b) the ability of Borrower to pay dividends or other distributions with respect to any of its Equity Interests or to make or repay loans or advances to Anixter; provided that the foregoing shall not apply to restrictions and conditions imposed by any Requirement of Law or by any Loan Document or Receivables Facility Transaction Document.
SECTION 7.11. Amendment of Material Documents .
(a) Anixter will not, and will not permit any member of the Consolidated Group to, amend, modify or waive any of its rights under (i) any agreement relating to any Subordinated Indebtedness, (ii) the Revolving Subordinated Note, or (iii) the HD Supply Acquisition Agreement, in each case without five (5) Business Days’ prior written notice or to the extent any such amendment, modification, or waiver would be adverse to the Lenders.
(b) Notwithstanding anything to the contrary contained in this Section 7.11, the Borrower will not, and with respect to (2) below, will not cause any Inventory Facility Loan Party to, amend, modify or waive any of its rights under (1) its Organization Documents or (2) any Receivables Facility Transaction Documents, in each case, without five (5) Business Days’ prior written notice or to the extent any such amendment, modification or waiver would impair its ability to comply with the terms or provisions of any of the Loan Documents, including Section 6.19 or any of the Receivables Facility Transaction Documents as in effect on the Effective Date.
SECTION 7.12. Employee Benefit Matters .
Anixter will not, and will not permit any ERISA Affiliates (including the Borrower) to, do any of the following which, individually, or in the aggregate, could reasonably be expected to result in a Material Adverse Effect:
(a) engage in any prohibited transaction described in Section 406 of ERISA or 4975 of the Code for which a statutory or class exemption is not available or a private exemption has not been previously obtained from the U.S. Department of Labor;
(b) permit any failure to make “minimum required contributions” (as defined in Sections 302 of ERISA and 412 of the Code), whether or not waived;
(c) fail to pay timely required contributions or annual installments due with respect to any waived funding deficiency to any Benefit Plan;
(d) terminate any Benefit Plan in a distress termination under Section 4041(c) of ERISA which would result in any liability to Anixter or any ERISA Affiliates;
(e) fail to make any contribution or payment to any Multiemployer Plan which Anixter or any ERISA Affiliates may be required to make under any agreement relating to such Multiemployer Plan, or any law pertaining thereto;
 
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(f) fail to pay any required installment or any other payment required under Section 412 or 430 of the Code on or before the due date for such installment or other payment;
(g) amend a Plan resulting in an increase in the “adjusted funding target attainment percentage” (as defined in Section 436 of the Code) for the plan year such that Anixter or any ERISA Affiliates is required to provide security to such Plan under Section 436 of the Code;
(h) permit any unfunded liabilities with respect to any Foreign Pension Plan to exist; or
(i) fail to pay any required contribution or payment to a Foreign Pension Plan on or before the date for such required installment or payment.
SECTION 7.13. Environmental Liabilities .
(a) Anixter will not, and will not permit any member of the Consolidated Group to, become subject to any Environmental Liability which could reasonably be expected to result in a Material Adverse Effect.
(b) Notwithstanding anything to the contrary contained in this Section 7.13, the Borrower will not become subject to any Environmental Liability.
SECTION 7.14. Financial Covenants .
(a) Minimum Fixed Charge Coverage Ratio . Anixter will not permit the Consolidated Fixed Charge Coverage Ratio, calculated as of the end of any Fiscal Quarter for the period of four (4) Fiscal Quarters then most recently ended, commencing on the date that a Financial Covenant Trigger Period first begins and measured as of the end of the Fiscal Quarter ending immediately preceding the date on which such Financial Covenant Trigger Period first began and as of the end of each Fiscal Quarter thereafter during such Financial Covenant Trigger Period, to be less than 1.0 to 1.0. The Consolidated Fixed Charge Coverage Ratio will be calculated after the elimination of the minority interest in any Subsidiaries that are not wholly owned Subsidiaries.
(b) Minimum Net Worth . The Borrower shall have at all times Net Worth of not less than 3.5% of the Outstanding Balance of the Receivables at such time.
SECTION 7.15. Change in Payment Instructions to Obligors . Except as may be required by the Administrative Agent pursuant to Section 8.02(b), neither the Borrower nor the Servicer will add or terminate any bank as a Collection Bank, or make any change in the instructions to Obligors regarding payments to be made to any Lock-Box or Collection Account, unless the Administrative Agent shall have received, at least ten (10) days before the proposed effective date therefor, (a) written notice of such addition, termination or change and (b) with respect to the addition of a Collection Bank or the addition of a Lock-Box or Collection Account, an executed Collection Account Agreement with respect to the new Lock-Box or Collection Account; provided that the Borrower may make changes in instructions to Obligors regarding payments if such new instructions require such Obligor to make payments to another existing Collection Account.
SECTION 7.16. Modifications to Contracts and Credit and Collection Policy . The Borrower will not make any change to any Credit and Collection Policy that could reasonably be expected to adversely affect the collectability of the Receivables or decrease the credit quality of any newly created Receivables, unless required to do so by a change in any applicable law, rule or regulation. Except as provided in Section 8.02(d), the Borrower or the Servicer will not extend, amend or otherwise modify the terms of any Receivable or any related Contract other than in accordance with the applicable Credit and Collection Policy.
 
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SECTION 7.17. Designation of Amortization Date . The Borrower will not designate the “Amortization Date” (as defined in the Receivables Sale Agreement), or send any written notice to the Seller in respect thereof, without the prior written consent of the Administrative Agent, except with respect to the occurrence of an Amortization Date arising pursuant to clause (h), (i) or (j) of Article IX. The Borrower will not, and will not permit the Seller to, designate the “Amortization Date” (as defined in any Receivables Transfer Agreement), or send any written notice to any Originator in respect thereof, without the prior written consent of the Administrative Agent, except with respect to the occurrence of an Amortization Event of the type described in clause (h), (i), or (j) of Article IX.
SECTION 7.18. Termination of Receivables Sale Agreement . The Borrower will not terminate the Receivables Sale Agreement without the prior written consent of each of the Lenders, except for a termination arising as a result of the Facility Termination Date.
SECTION 7.19. Name Change; Offices and Records . Neither the Borrower nor the Servicer will change its name, change its mailing address, identity, state of incorporation, corporate structure or organizational identification number, if any, or relocate its chief executive office or any office where Records are kept unless it shall have: (a) given the Administrative Agent at least forty-five (45) days’ prior written notice thereof and (b) delivered to the Administrative Agent all financing statements, instruments and other documents requested by the Administrative Agent in connection with such change or relocation.
SECTION 7.20. Protection of Title . The Servicer will defend the right, title and interest of the Administrative Agent and the Lenders in, to and under the Receivables, and the Related Security and Collections, each Contract under which any Account arises, each Lock-Box and each Collection Account, against all claims of third parties claiming through or under the Borrower or the Seller.
ARTICLE VIII
Administration and Collection
SECTION 8.01. Designation of the Servicer .
(a) The servicing, administration and collection of the Receivables shall be conducted by such Person (the “ Servicer ”) so designated from time to time in accordance with this Section 8.01(a). Anixter is hereby designated as, and hereby agrees to perform the duties and obligations of, the Servicer pursuant to the terms of this Agreement. Anixter shall not resign as the Servicer without the prior written consent of the Administrative Agent. The Administrative Agent may at any time designate as Servicer any Person to succeed Anixter or any successor Servicer. It is understood and agreed that, solely with respect to the Subsidiary Originator Receivables, the Subsidiary Originator originating such Subsidiary Originator Receivables is hereby designated as sub-servicer and will perform all of the duties and obligations of the Servicer with respect to such Subsidiary Originator Receivables.
(b) Without the prior written consent of the Administrative Agent, Anixter shall not be permitted to delegate any of its duties or responsibilities as Servicer to any Person other than (i) the Borrower, (ii) each Subsidiary Originator with respect to its respective Subsidiary Originator Receivables and (iii) with respect to certain Charged-Off Receivables, outside collection agencies in accordance with its customary practices. Neither the Borrower nor Subsidiary Originator shall be permitted to further delegate to any other Person any of the duties or responsibilities of the Servicer delegated to it by Anixter.
 
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If at any time the Administrative Agent shall designate as Servicer any Person other than Anixter, all duties and responsibilities theretofore delegated by Anixter to the Borrower may, at the discretion of the Administrative Agent, be terminated forthwith on notice given by the Administrative Agent to Anixter and the Borrower.
(c) Notwithstanding the foregoing subsection (b), if Anixter shall have delegated its duties and responsibilities as Servicer to any Person, (i) Anixter shall be and remain primarily liable to the Administrative Agent and the Lenders for the full and prompt performance of all duties and responsibilities of the Servicer (other than any Servicer appointed by the Administrative Agent without Anixter’s consent) hereunder, (ii) Administrative Agent and the Lenders shall be entitled to deal exclusively with Anixter in matters relating to the discharge by the Servicer (other than any Servicer appointed by the Administrative Agent without Anixter’s consent) of its duties and responsibilities hereunder and (iii) neither the Administrative Agent nor any of the Lenders shall be required to give any notice, demand or other communication to any Person other than Anixter in order for communication to the Servicer (other than any Servicer appointed by the Administrative Agent without Anixter’s consent) and its sub-servicer or other delegate with respect thereto to be accomplished. Anixter, at all times that it is the Servicer, shall be responsible for providing any sub-servicer or other delegate of the Servicer with any notice given to the Servicer under this Agreement.
SECTION 8.02. Duties of the Servicer .
(a) The Servicer shall take or cause to be taken all such actions as may be necessary or advisable to collect each Receivable from time to time, all in accordance with applicable laws, rules and regulations, with reasonable care and diligence, and in accordance with the applicable Credit and Collection Policy.
(b) The Servicer will instruct all Obligors to pay all Collections directly to a Lock-Box or Collection Account, or, to the extent permitted by the Security Agreement, a Company Owned Post Office Box. The Servicer shall execute a Collection Account Agreement in form and substance reasonably satisfactory to the Administrative Agent with each bank maintaining a Collection Account at any time. In the case of any remittances received in any Lock-Box or Collection Account that shall have been identified, to the satisfaction of the Servicer, to not constitute Collections or other proceeds of the Receivables or the Related Security with respect thereto, the Servicer shall promptly remit such items to the Person identified to it as being the owner of such remittances. From and after the date the Administrative Agent delivers to any Collection Bank a Collection Notice pursuant to Section 8.03, the Administrative Agent may request that the Servicer, and the Servicer thereupon promptly shall instruct all Obligors with respect to the Receivables, to remit all payments thereon to a new depositary account specified by the Administrative Agent and, at all times thereafter, the Borrower and the Servicer shall not deposit or otherwise credit, and shall not permit any other Person to deposit or otherwise credit to such new depositary account any cash or payment item other than Collections.
(c) The Servicer (or, during any Cash Dominion Trigger Period, the Administrative Agent) shall administer the Collections in accordance with the procedures described herein and in Article III. The Servicer shall set aside and hold in trust for the account of the Borrower and the Lenders their respective shares of the Collections in accordance with Article III. During any Cash Dominion Trigger Period, the Servicer shall, at the request of the Administration Agent, segregate, in a manner acceptable to the Administrative Agent, all cash, checks and other instruments received by it from time to time constituting Collections from the general funds of the Servicer or the Borrower prior to the remittance thereof in accordance with Article III to the extent of any accrued and unpaid Obligations. If the Servicer shall be required to segregate Collections pursuant to the preceding sentence, the Servicer shall segregate and deposit such Collections with a bank designated by the Administrative Agent on the first Business Day following receipt by the Servicer of such Collections, duly endorsed or with duly executed instruments of transfer.
 
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(d) The Servicer may, in accordance with the applicable Credit and Collection Policy, extend the maturity of any Receivable or adjust the Outstanding Balance of any Receivable as the Servicer determines to be appropriate to maximize Collections thereof; provided , that such extension or adjustment shall not alter the status of such Receivable as a Charged-Off Receivable or limit the rights of the Administrative Agent or the Lenders under this Agreement. Notwithstanding anything to the contrary contained herein, at any time during the Amortization Period, the Administrative Agent, in its discretion or at the direction of the Required Lenders, shall have the absolute and unlimited right to direct the Servicer to commence or settle any legal action with respect to any Receivable or to foreclose upon or repossess any Related Security with respect thereto.
(e) The Servicer shall hold for the Borrower and the Administrative Agent (on behalf of the Lenders) all Records that (i) evidence or relate to the Receivables, the related Contracts and the Related Security with respect thereto or (ii) are otherwise necessary or desirable to collect the Receivables and shall, as soon as practicable upon demand of the Administrative Agent, in its discretion or at the direction of the Required Lenders, at any time following an Amortization Event or a Potential Amortization Event, deliver or make available to the Administrative Agent all such Records, at a place selected by the Administrative Agent, with the consent or at the direction of the Required Lenders.
SECTION 8.03. Collection Notices . Upon the occurrence of and during the continuation of an Amortization Event or a Potential Amortization Event, or during any Cash Dominion Trigger Period, the Administrative Agent is authorized at any time to date and to deliver to the Collection Banks the Collection Notices, and shall deliver such Collection Notices if directed to do so by the Required Lenders. The Borrower hereby transfers to the Administrative Agent for the benefit of the Lenders, effective when the Administrative Agent delivers such notice, the exclusive ownership and control of each Lock-Box and Collection Account. If any authorized signatory of the Borrower whose signature appears on a Collection Account Agreement shall cease to have such authority before the delivery of a Collection Notice with respect thereto, such Collection Notice shall nevertheless be valid as if such authority had remained in force. The Borrower hereby authorizes the Administrative Agent, and agrees that the Administrative Agent shall be entitled to, following the delivery of any Collection Notice, (i) endorse the Borrower’s name on checks and other instruments representing Collections, (ii) enforce the Receivables, the related Contracts and the Related Security with respect thereto and (iii) take such action as shall be necessary or desirable to cause all cash, checks and other instruments constituting Collections of Receivables to come into the possession of the Administrative Agent rather than the Borrower.
SECTION 8.04. Responsibilities of the Borrower . Notwithstanding anything to the contrary contained herein, the exercise by the Administrative Agent and the Lenders of their rights hereunder shall not release the Servicer, any Originator or the Borrower from any of their duties or obligations with respect to the Receivables or under the related Contracts. Neither the Administrative Agent nor any of the Lenders shall have any obligation or liability with respect to the Receivables or the related Contracts, nor shall any of them be obligated to perform the obligations of the Borrower.
SECTION 8.05. Servicing Fees . In consideration of Anixter’s agreement to act as Servicer hereunder and as compensation for its servicing activities, the Lenders hereby agree that, so long as Anixter shall continue to perform as Servicer hereunder, the Borrower shall pay over to Anixter a fee (the “ Servicing Fee ”) on the first calendar day of each month, in arrears for the immediately preceding calendar month, equal to 0.37% times the Outstanding Balance of all Receivables generated during such immediately preceding calendar month, as compensation for its servicing activities.
 
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ARTICLE IX
Amortization Events
If any of the following events (“ Amortization Events ”) shall occur:
(a) the Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC Disbursement when and as the same shall become due and payable, or the Seller shall fail to make any payment or deposit required under the Receivables Sale Agreement when due, in any case whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;
(b) (i) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under this Agreement or any other Loan Document, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three (3) Business Days; or (ii) the Seller shall fail to make any payment or deposit required to be paid to a Lender, the Administrative Agent or an Indemnitee under this Agreement or any other Loan Document;
(c) any representation or warranty made or deemed made by or on behalf of the Borrower or Anixter or any of its Subsidiaries in, or in connection with, this Agreement, any other Loan Document or any Receivables Facility Transaction Document or any amendment or modification hereof or thereof or waiver hereunder or thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement, any other Loan Document or any Receivables Facility Transaction Document or any amendment or modification hereof or thereof or waiver hereunder or thereunder, shall prove to have been false or misleading in any material respect (or, if such representation or warranty is already qualified or modified by materiality in the text thereof, in any respect) when made or deemed made;
(d) the Borrower, Anixter or any of its Subsidiaries shall fail to observe or perform any covenant, condition or agreement contained in Section 6.01 (other than clauses (b) (but only with respect to the last Fiscal Quarter of a Fiscal Year), (i), (j), (l) and (m)), Section 6.02(a), Section 6.03 (with respect to the Borrower’s existence), Section 6.08, Section 6.10 or in Article VII (other than Section 7.12);
(e) (i) the Borrower, Anixter or any of its Subsidiaries shall fail to observe or perform any covenant, condition or agreement contained in Section 6.01(b) (but only with respect to the last Fiscal Quarter of a Fiscal Year), (i), (j), (l), and (m), Section 6.02 (other than clause (a)), Section 6.03 (other than with respect to the Borrower’s existence), Section 6.04, Section 6.05, Section 6.06 (solely if the Borrower refuses to permit any representative designated by the Administrative Agent or any Lender to visit and inspect the Borrower’s properties, to conduct at such Person’s premises field examinations of such Person’s assets, liabilities, books and records, including examining and making extracts from its books and records, environmental assessment reports, and to discuss its affairs, finances and condition with its officers and independent accountants, in each case subject to and in accordance with Section 6.06), Section 6.07, or Section 6.14, and such failure shall continue unremedied for a period of fifteen (15) days after the earlier of knowledge of such breach by the Borrower, Anixter or any of its Subsidiaries or notice thereof from the Administrative Agent (which notice will be given at the request of any Lender), provided that with respect to Section 6.01(b) as set forth in this clause, the grace period shall be the shorter of fifteen (15) days and the date such deliveries required thereunder were delivered or required to be delivered to the SEC; or (ii) the Borrower, Anixter or any of its Subsidiaries shall fail to observe or perform any covenant, condition or agreement contained in this Agreement, any other Loan Document (unless a specific cure and/or grace period relating to such covenant, condition or agreement is referenced in such Loan Document) or any Receivables Facility Transaction Document (other than those
 
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which constitute a default under another Section of this Article), and such failure shall continue unremedied for a period of thirty (30) days after the earlier of knowledge of such breach by the Borrower, Anixter or any of its Subsidiaries or notice thereof from the Administrative Agent (which notice will be given at the request of any Lender);
(f) AXE, Anixter or any Subsidiary of Anixter shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness when and as the same shall become due and payable (beyond any applicable grace period);
(g) (i) any event of default (however defined) occurs under the Inventory Facility; or (ii) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof;
(h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 or any such Person’s debts, or of a substantial part of any such Person’s assets, under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 or for a substantial part of any such Person’s assets, and, in any such case, such proceeding or petition shall continue undismissed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall be entered;
(i) the Borrower, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for such Person or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors, or (vi) take any action for the purpose of effecting any of the foregoing;
(j) the Borrower, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 shall become unable, admit in writing its inability, or publicly declare its intention not to, or fail generally to pay its debts as they become due;
(k) (i) an Enforceable Judgment (other than an Enforceable Judgment described in the proviso contained in the definition of the term “Enforceable Judgment”) for the payment of money in excess of $35,000,000 shall be rendered against Anixter, any Subsidiary of Anixter, or any combination thereof and the same shall remain undischarged for a period of thirty (30) consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to enforce any such Enforceable Judgment; or (ii) any Enforceable Judgment described in the proviso contained in the definition of the term “Enforceable Judgment” shall be rendered against the Borrower;
(l) any order, judgment, or decree shall be entered against the Borrower, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 decreeing its involuntary dissolution or split-up and such order shall remain undischarged and unstayed for a period in excess of thirty (30) days,
 
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or the Borrower, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 shall otherwise dissolve or cease to exist, in each case except as expressly permitted pursuant to Section 7.03(a) or 7.03(b);
(m) (i) any one or more Termination Events occur which could reasonably be expected to subject Anixter or an ERISA Affiliate to a liability to pay more than $75,000,000 in the aggregate, or (ii) the plan administrator of any Plan applies under Section 412(c) of the Code for a waiver of the minimum funding standards of Section 412(a) of the Code and the substantial business hardship upon which the application for the waiver is based could reasonably be expected to subject either Anixter or any ERISA Affiliate to a liability of more than $75,000,000 in the aggregate;
(n) (i) a Change in Control shall occur, (ii) Anixter shall cease to own directly or indirectly all of the capital stock of the Borrower (other than director’s qualifying shares); (iii) except as permitted in Section 7.05(a), Anixter shall cease to own directly or indirectly at least 51% of the outstanding stock of each class of the capital stock of each Subsidiary of Anixter; or (iv) AXE shall cease to own at least 51% of the outstanding stock of each class of the capital stock of Anixter;
(o) any breach or other violation by any holder of the Revolving Subordinated Note of the subordination or enforcement restrictions applicable thereto shall occur;
(p) any Obligation Guaranty shall fail to remain in full force or effect or any action shall be taken to discontinue or to assert the invalidity or unenforceability of any Obligation Guaranty or any Guarantor shall fail to comply with any Obligation Guaranty to which it is a party, or any Guarantor shall deny that it has any further liability under any Obligation Guaranty to which it is a party, or shall give notice to such effect;
(q) except as permitted by the terms of this Agreement, any Collateral Document, or the Intercreditor Agreement, (i) any Collateral Document shall for any reason fail to create a valid security interest in any Collateral with a value of $1,000,000 or greater in the aggregate purported to be covered thereby, or (ii) any Lien securing any Secured Obligation shall cease to be a perfected, first-priority Lien;
(r) any Collateral Document shall fail to remain in full force or effect or any action shall be taken to discontinue or to assert the invalidity or unenforceability of any Collateral Document;
(s) any material provision of any Loan Document or any Receivables Facility Transaction Document for any reason ceases to be valid, binding and enforceable in accordance with its terms (or any Person party thereto shall challenge the enforceability of any Loan Document or any Receivables Facility Transaction Document or shall assert in writing, or engage in any action or inaction that evidences its assertion, that any provision of any of the Loan Documents or any Receivables Facility Transaction Documents has ceased to be or otherwise is not valid, binding and enforceable in accordance with its terms);
(t) the Indebtedness evidenced by the 5.625% Senior Notes due 2019 issued under the 2012 Notes Indenture is not repaid in full or refinanced or replaced on terms mutually satisfactory to Anixter and the Administrative Agent (including, as to any Indebtedness refinancing or replacing such notes, such Indebtedness having a maturity date not earlier than ninety (90) days after the Maturity Date) by January 31, 2019, which is the date that is ninety (90) days before the stated maturity date of such notes as of the Effective Date;
(u) any requirement arises under the 2012 Notes Indenture to grant liens upon any Collateral to secure any Indebtedness issued under the 2012 Notes Indenture;
 
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(v) as at the end of any Collection Period, the occurrence and continuation of a Servicer Termination Event shall have occurred; or
(w) The Seller shall for any reason cease to transfer, or cease to have the legal capacity to transfer, or otherwise be incapable of transferring Receivables to the Borrower under the Receivables Sale Agreement, other than as a result of the occurrence of the Facility Termination Date;
then, and in every such event (other than an event with respect to the Borrower described in clause (h) or (i) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take either or both of the following actions, at the same or different times: (i) terminate the Commitments, whereupon the Commitments shall terminate immediately, and (ii) declare the Loans then outstanding to be due and payable in whole (or in part, but ratably as among the Classes of Loans and the Loans of each Class at the time outstanding, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), whereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, in each case without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; and in the case of any event with respect to the Borrower described in clause (h) or (i) of this Article, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, in each case without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower. Upon the occurrence and during the continuance of an Amortization Event, the Administrative Agent may, and at the request of the Required Lenders shall, increase the rate of interest applicable to the Loans and other Obligations as set forth in this Agreement and exercise any rights and remedies provided to the Administrative Agent under the Loan Documents or at law or equity, including all remedies provided under the UCC.
ARTICLE X
The Administrative Agent
SECTION 10.01. Appointment . Each of the Lenders, on behalf of itself and any of its Affiliates that are Secured Parties and the Issuing Bank hereby irrevocably appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take such actions on its behalf, including execution of the other Loan Documents, and to exercise such powers as are delegated to the Administrative Agent by the terms of the Loan Documents, together with such actions and powers as are reasonably incidental thereto. In addition, to the extent required under the laws of any jurisdiction other than the U.S., each of the Lenders and the Issuing Bank hereby grants to the Administrative Agent any required powers of attorney to execute any Collateral Document governed by the laws of such jurisdiction on such Lender’s or Issuing Bank’s behalf. The provisions of this Article are solely for the benefit of the Administrative Agent and the Lenders (including the Swingline Lender and the Issuing Bank), and the Borrower shall not have rights as a third party beneficiary of any of such provisions. It is understood and agreed that the use of the term “agent” as used herein or in any other Loan Documents (or any similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead, such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties.
SECTION 10.02. Rights as a Lender . The bank serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may
 
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exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Borrower or any Affiliate thereof as if it were not the Administrative Agent hereunder.
SECTION 10.03. Duties and Obligations . The Administrative Agent shall not have any duties or obligations except those expressly set forth in the Loan Documents. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Potential Amortization Event has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated by the Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 11.02), and, (c) except as expressly set forth in the Loan Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 11.02) or in the absence of its own gross negligence or willful misconduct as determined by a final nonappealable judgment of a court of competent jurisdiction. The Administrative Agent shall be deemed not to have knowledge of any Potential Amortization Event unless and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or in connection with any Loan Document, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth in any Loan Document, (iv) the validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document, (v) the creation, perfection or priority of Liens on the Collateral or the existence of the Collateral, or (vi) the satisfaction of any condition set forth in Article IV or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.
SECTION 10.04. Reliance . The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall not incur any liability for relying thereon. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
SECTION 10.05. Actions through Sub-Agents . The Administrative Agent may perform any and all of its duties and exercise its rights and powers by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as the Administrative Agent.
 
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SECTION 10.06. Resignation . Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, the Administrative Agent may resign at any time by notifying the Lenders, the Issuing Bank and the Borrower. Upon any such resignation, the Required Lenders shall have the right, in consultation with the Borrower, to appoint a successor. If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may, on behalf of the Lenders and the Issuing Bank, appoint a successor Administrative Agent which shall be a bank with an office in New York, New York, or an Affiliate of any such bank. Upon the acceptance of its appointment as Administrative Agent hereunder by its successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents. The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor, unless otherwise agreed by the Borrower and such successor. Notwithstanding the foregoing, in the event no successor Administrative Agent shall have been so appointed and shall have accepted such appointment within thirty (30) days after the retiring Administrative Agent gives notice of its intent to resign, the retiring Administrative Agent may give notice of the effectiveness of its resignation to the Lenders, the Issuing Banks and the Borrower, whereupon, on the date of effectiveness of such resignation stated in such notice, (a) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents, provided that, solely for purposes of maintaining any security interest granted to the Administrative Agent under any Collateral Document for the benefit of the Secured Parties, the retiring Administrative Agent shall continue to be vested with such security interest as collateral agent for the benefit of the Secured Parties and, in the case of any Collateral in the possession of the Administrative Agent, shall continue to hold such Collateral, in each case until such time as a successor Administrative Agent is appointed and accepts such appointment in accordance with this paragraph (it being understood and agreed that the retiring Administrative Agent shall have no duly or obligation to take any further action under any Collateral Document, including any action required to maintain the perfection of any such security interest), and (b) the Required Lenders shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, provided that (i) all payments required to be made hereunder or under any other Loan Document to the Administrative Agent for the account of any Person other than the Administrative Agent shall be made directly to such Person and (ii) all notices and other communications required or contemplated to be given or made to the Administrative Agent shall also directly be given or made to each Lender and each Issuing Bank. Following the effectiveness of the Administrative Agent’s resignation from its capacity as such, the provisions of this Article, Section 2.17(d) and Section 11.03, as well as any exculpatory, reimbursement and indemnification provisions set forth in any other Loan Document, shall continue in effect for the benefit of such retiring Administrative Agent, its sub agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while it was acting as Administrative Agent and in respect of the matters referred to in the proviso under clause (a) above.
SECTION 10.07. Non-Reliance .
(a) Each Lender acknowledges and agrees that the extensions of credit made hereunder are commercial loans and letters of credit and not investments in a business enterprise or securities. Each Lender further represents that it is engaged in making, acquiring or holding commercial loans in the ordinary course of its business and has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement as a Lender, and to make, acquire or hold Loans hereunder. Each Lender shall, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information (which may contain material, non-public information within the meaning of the United States securities laws concerning the Borrower
 
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and its Affiliates) as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document, any related agreement or any document furnished hereunder or thereunder and in deciding whether or to the extent to which it will continue as a Lender or assign or otherwise transfer its rights, interests and obligations hereunder.
(b) Each Lender hereby agrees that (i) it has requested a copy of each Report prepared by or on behalf of the Administrative Agent; (ii) the Administrative Agent (A) makes no representation or warranty, express or implied, as to the completeness or accuracy of any Report or any of the information contained therein or any inaccuracy or omission contained in or relating to a Report and (B) shall not be liable for any information contained in any Report; (iii) the Reports are not comprehensive audits or examinations, and that any Person performing any field examination will inspect only specific information regarding the Borrower and will rely significantly upon the Borrower’s books and records, as well as on representations of the Borrower’s personnel and that the Administrative Agent undertakes no obligation to update, correct or supplement the Reports; (iv) it will keep all Reports confidential and strictly for its internal use, not share the Report with the Borrower or any other Person except as otherwise permitted pursuant to this Agreement; and (v) without limiting the generality of any other indemnification provision contained in this Agreement, (A) it will hold the Administrative Agent and any such other Person preparing a Report harmless from any action the indemnifying Lender may take or conclusion the indemnifying Lender may reach or draw from any Report in connection with any extension of credit that the indemnifying Lender has made or may make to the Borrower, or the indemnifying Lender’s participation in, or the indemnifying Lender’s purchase of, a Loan or Loans; and (B) it will pay and protect, and indemnify, defend, and hold the Administrative Agent and any such other Person preparing a Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts (including reasonable attorneys’ fees) incurred by the Administrative Agent or any such other Person as the direct or indirect result of any third parties who might obtain all or part of any Report through the indemnifying Lender.
SECTION 10.08. Other Agency Titles . Each of the Joint Lead Arrangers, Joint Book Runners, Administrative Agent, Co-Syndication Agents, and Co-Documentation Agents shall not have any right, power, obligation, liability, responsibility or duty under this Agreement other than those applicable to all Lenders as such. Without limiting the foregoing, none of such Lenders shall have or be deemed to have a fiduciary relationship with any Lender. Each Lender hereby makes the same acknowledgments with respect to the relevant Lenders in their respective capacities as Administrative Agent, Co-Syndication Agent and Co-Documentation Agent, as applicable, as it makes with respect to the Administrative Agent in the preceding paragraph.
SECTION 10.09. Not Partners or Co-Venturers; Administrative Agent as Representative of the Secured Parties .
(a) The Lenders are not partners or co-venturers, and no Lender shall be liable for the acts or omissions of, or (except as otherwise set forth herein in case of the Administrative Agent) authorized to act for, any other Lender. The Administrative Agent shall have the exclusive right on behalf of the Lenders to enforce the payment of the principal of and interest on any Loan after the date such principal or interest has become due and payable pursuant to the terms of this Agreement.
(b) In its capacity, the Administrative Agent is a “representative” of the Secured Parties within the meaning of the term “secured party” as defined in the Illinois Uniform Commercial Code. Each Lender authorizes the Administrative Agent to enter into each of the Collateral Documents to which it is a party and to take all action contemplated by such documents. Each Lender agrees that no Secured Party (other than the Administrative Agent) shall have the right individually to seek to realize upon the
 
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security granted by any Collateral Document, it being understood and agreed that such rights and remedies may be exercised solely by the Administrative Agent for the benefit of the Secured Parties upon the terms of the Collateral Documents. In the event that any Collateral is hereafter pledged by any Person as collateral security for the Secured Obligations, the Administrative Agent is hereby authorized, and hereby granted a power of attorney, to execute and deliver on behalf of the Secured Parties any Loan Documents necessary or appropriate to grant and perfect a Lien on such Collateral in favor of the Administrative Agent on behalf of the Secured Parties.
SECTION 10.10. Flood Laws . Chase has adopted internal policies and procedures that address requirements placed on federally regulated lenders under the National Flood Insurance Reform Act of 1994 and related legislation (the “ Flood Laws ”). Chase, as administrative agent or collateral agent on a syndicated facility, will post on the applicable electronic platform (or otherwise distribute to each Lender in the syndicate) documents that it receives in connection with the Flood Laws. However, Chase reminds each Lender and Participant in the facility that, pursuant to the Flood Laws, each federally regulated Lender (whether acting as a Lender or Participant in the facility) is responsible for assuring its own compliance with the flood insurance requirements.
ARTICLE XI
Miscellaneous
SECTION 11.01. Notices .
(a) Except in the case of notices and other communications expressly permitted to be given by telephone or Electronic Systems (and subject in each case to paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile, as follows:
 
 	(i)	if to the Borrower at:	
2301 Patriot Boulevard
Glenview, IL 60026
Attention: David Johnson
Facsimile No: (224) 521-8990
 
 	(ii)	if to the Administrative Agent, the Issuing Bank or the Swingline Lender, to JPMorgan Chase Bank, N.A. at:	
10 S. Dearborn Street, 22 nd Floor
Mail Code: IL1-1454
Chicago, IL 60603
Attention: Stephanie Lis
Facsimile No: (312) 732-1262
 
 	(iii)	if to any other Lender, to it at its address or facsimile number set forth in its Administrative Questionnaire.	
All such notices and other communications (1) sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received, (2) sent by facsimile shall be deemed to have been given when sent, provided that if not given during normal business hours of the recipient, such notice or communication shall be deemed to have been given at the opening of business on the next Business Day of the recipient, or (3) delivered through Electronic Systems to the extent provided in paragraph (b) below shall be effective as provided in such paragraph.
 
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(b) Notices and other communications to the Lenders hereunder may be delivered or furnished by Electronic Systems pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article II or to compliance and no Potential Amortization Event certificates delivered pursuant to Section 5.01(d) unless otherwise agreed by the Administrative Agent and the applicable Lender. Each of the Administrative Agent and the Borrower (on behalf of itself and Anixter) may, in its discretion, agree to accept notices and other communications to it hereunder by Electronic Systems pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications. Unless the Administrative Agent otherwise proscribes, all such notices and other communications (i) sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), provided that if not given during the normal business hours of the recipient, such notice or communication shall be deemed to have been given at the opening of business on the next Business Day for the recipient, and (ii) posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, e-mail or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day of the recipient.
(c) Any party hereto may change its address, facsimile number or e-mail address for notices and other communications hereunder by notice to the other parties hereto.
(d) Electronic Systems .
(i) Borrower and Anixter each agrees that the Administrative Agent may, but shall not be obligated to, make Communications (as defined below) available to the Issuing Bank and the other Lenders by posting the Communications on Debt Domain, Intralinks, Syndtrak, ClearPar or a substantially similar Electronic System.
(ii) Any Electronic System used by the Administrative Agent is provided “as is” and “as available.” The Agent Parties (as defined below) do not warrant the adequacy of such Electronic Systems and expressly disclaim liability for errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Communications or any Electronic System. In no event shall the Administrative Agent or any of its Related Parties (collectively, the “ Agent Parties ”) have any liability to the Borrower, any Lender, the Issuing Bank or any other Person or entity for damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of communications through an Electronic System. “ Communications ” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of the Borrower or Anixter pursuant to any Loan Document or the transactions contemplated therein which is distributed by the Administrative Agent, any Lender or the Issuing Bank by means of electronic communications pursuant to this Section, including through an Electronic System.
 
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SECTION 11.02. Waivers; Amendments .
(a) No failure or delay by the Administrative Agent, the Issuing Bank or any Lender in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent, the Issuing Bank and the Lenders hereunder and under any other Loan Document are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of any Loan Document or consent to any departure by the Borrower or Anixter therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Potential Amortization Event, regardless of whether the Administrative Agent, any Lender or the Issuing Bank may have had notice or knowledge of such Potential Amortization Event at the time.
(b) Except as provided in the first sentence of Section 2.09(f) (with respect to any commitment increase), neither this Agreement nor any other Loan Document (other than the Fee Letter) nor any provision hereof or thereof may be waived, amended or modified except (x) in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Borrower, the Servicer and the Required Lenders or (y) in the case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by the Administrative Agent and the Borrower and/or Anixter, as applicable, that are parties thereto, with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender (including any such Lender that is a Defaulting Lender), (ii) reduce or forgive the principal amount of any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce or forgive any interest or fees payable hereunder, without the written consent of each Lender (including any such Lender that is a Defaulting Lender) directly affected thereby, (iii) postpone any scheduled date of payment of the principal amount of any Loan or LC Disbursement, or any date for the payment of any interest, fees or other Obligations payable hereunder, or the date of any payment or deposit of Collections by the Borrower or the Servicer, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment or change the definition of “Maturity Date”, without the written consent of each Lender (including any such Lender that is a Defaulting Lender) directly affected thereby, (iv) change Section 2.18(b) or (d) in a manner that would alter the order or manner in which payments are shared, without the written consent of each Lender (other than any Defaulting Lender), (v) increase the advance rates set forth in the definition of “Borrowing Base” or otherwise amend, modify, or eliminate the definition of “Borrowing Base” or any of the defined terms (including the definition of “Eligible Receivables”) that are used in that definition to the extent that any such change results in more credit being made available to the Borrower based upon the Borrowing Base, but not otherwise, without the written consent of each Lender (other than any Defaulting Lender) or change the definition of “Amortization Event” or “Commitment” without the written consent of each Lender, (vi) change any of the provisions of this Section or the definition of “Required Lenders” or any other provision of any Loan Document specifying the number or percentage of Lenders (or Lenders of any Class) required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder, without the written consent of each Lender (other than any Defaulting Lender) directly affected thereby, (vii) change Section 2.20, without the consent of each Lender (other than any Defaulting Lender), (viii) release AXE from its obligation under the AXE Guaranty (except as otherwise permitted herein or in the other Loan Documents), without the written consent of each Lender (other than any Defaulting Lender), (ix) modify clause (t) of Article IX without the written consent of each Lender (other than any Defaulting Lender), or (x) except as provided in clause (c) of this Section or in any Collateral Document, release all
 
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or substantially all of the Collateral, without the written consent of each Lender (other than any Defaulting Lender); provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent, the Issuing Bank or the Swingline Lender hereunder without the prior written consent of the Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may be (it being understood that any amendment to Section 2.20 shall require the consent of the Administrative Agent, the Issuing Bank and the Swingline Lender). The Administrative Agent may also amend the Commitment Schedule to reflect assignments entered into pursuant to Section 11.04. Any amendment, waiver or other modification of this Agreement or any other Loan Document that by its terms affects the rights or duties under this Agreement of the Lenders of one or more Classes (but not the Lenders of any other Class), may be effected by an agreement or agreements in writing entered into by the Borrower and the requisite number or percentage in interest of each affected Class of Lenders that would be required to consent thereto under this Section if such Class of Lenders were the only Class of Lenders hereunder at the time.
(c) The Lenders and the Issuing Bank hereby irrevocably authorize the Administrative Agent, at its option and in its sole discretion, to release any Liens granted to the Administrative Agent by the Borrower on any Collateral (i) upon the termination of all of the Commitments, payment and satisfaction in full in cash of all Secured Obligations (other than Unliquidated Obligations), and the cash collateralization of all Unliquidated Obligations in a manner satisfactory to each affected Lender, (ii) constituting property being sold or disposed of if the Person disposing of such property certifies to the Administrative Agent that the sale or disposition is made in compliance with the terms of this Agreement (and the Administrative Agent may rely conclusively on any such certificate, without further inquiry), (iii) constituting property leased to Anixter or one of its Subsidiaries under a lease which has expired or been terminated in a transaction permitted under this Agreement, or (iv) as required to effect any sale or other disposition of such Collateral in connection with any exercise of remedies of the Administrative Agent and the Lenders pursuant to Article VII. Except as provided in the preceding sentence, the Administrative Agent will not release any Liens on Collateral without the prior written authorization of the Required Lenders; provided that, the Administrative Agent may in its discretion, release its Liens on Collateral valued in the aggregate not in excess of $15,000,000 during any calendar year without the prior written authorization of the Required Lenders (it being agreed that the Administrative Agent may rely conclusively on one or more certificates of the Borrower as to the value of any Collateral to be so released, without further inquiry). Any such release shall not in any manner discharge, affect, or impair the Obligations or any Liens (other than those expressly being released) upon (or obligations of the Borrower in respect of) all interests retained by the Borrower, including the proceeds of any sale, all of which shall continue to constitute part of the Collateral. Any execution and delivery by the Administrative Agent of documents in connection with any such release shall be without recourse to or warranty by the Administrative Agent.
(d) If, in connection with any proposed amendment, waiver or consent requiring the consent of “each Lender” or “each Lender affected thereby,” the consent of the Required Lenders is obtained, but the consent of other necessary Lenders is not obtained (any such Lender whose consent is necessary but has not been obtained being referred to herein as a “ Non-Consenting Lender ”), then the Borrower may elect to replace a Non-Consenting Lender as a Lender party to this Agreement, provided that, concurrently with such replacement, (i) another bank or other entity which is reasonably satisfactory to the Borrower, the Administrative Agent and the Issuing Bank shall agree, as of such date, to purchase for cash the Loans and other Obligations due to the Non-Consenting Lender pursuant to an Assignment and Assumption and to become a Lender for all purposes under this Agreement and to assume all obligations of the Non-Consenting Lender to be terminated as of such date and to comply with the requirements of clause (b) of Section 11.04, and (ii) the Borrower shall pay to such Non-Consenting Lender in same day funds on the day of such replacement (1) all interest, fees and other amounts then accrued but unpaid to such Non-Consenting Lender by the Borrower hereunder to and including the date of termination,
 
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including payments due to such Non-Consenting Lender under Section 2.15 and Section 2.17, and (2) an amount, if any, equal to the payment which would have been due to such Lender on the day of such replacement under Section 2.16 had the Loans of such Non-Consenting Lender been prepaid on such date rather than sold to the replacement Lender.
(e) Notwithstanding anything to the contrary herein the Administrative Agent may, with the consent of the Borrower only, amend, modify or supplement this Agreement or any of the other Loan Documents to cure any ambiguity, omission, mistake, defect or inconsistency.
SECTION 11.03. Expenses; Indemnity; Damage Waiver .
(a) The Borrower shall pay all (i) reasonable out of pocket expenses incurred by the Administrative Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent, in connection with the syndication and distribution (including, without limitation, via the internet or through an Electronic System) of the credit facilities provided for herein, the preparation and administration of the Loan Documents and any amendments, modifications or waivers of the provisions of the Loan Documents (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) reasonable out-of-pocket expenses incurred by the Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) out-of-pocket expenses incurred by the Administrative Agent, the Issuing Bank or any Lender, including the fees, charges and disbursements of any counsel for the Administrative Agent, the Issuing Bank or any Lender, in connection with the enforcement, collection or protection of its rights in connection with the Loan Documents or otherwise in connection with the transactions contemplated by the Loan Documents, the Administrative Agent’s Liens in and to the Collateral or the Lenders’, the Swingline Lender’s and the Issuing Banks’ relationship with AXE, Anixter or the Borrower, including its rights under this Section, or in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit, and including reasonable out-of-pocket costs and expenses relative to third party claims or any other lawsuit or adverse proceeding paid or incurred. With respect to fees, charges and disbursements of counsel described in clause (iii) above, the foregoing shall be limited to the reasonable out-of-pocket fees, charges and disbursements of counsel of one counsel for the Administrative Agent and one counsel for the Lenders unless a conflict of interest arises, and, in such case, additional counsel for each Lender to the extent reasonably required by such conflict of interest. Expenses being reimbursed by the Borrower under this Section include, without limiting the generality of the foregoing, fees, costs and expenses incurred in connection with:
(i) appraisals and insurance reviews;
(ii) field examinations and the preparation of Reports based on the fees charged by a third party retained by the Administrative Agent or the internally allocated fees for each Person employed by the Administrative Agent with respect to each field examination;
(iii) background checks regarding senior management and/or key investors, as deemed necessary or appropriate in the sole discretion of the Administrative Agent;
(iv) Taxes, fees and other charges for (A) lien and title searches and title insurance and (B) recording the mortgages, filing financing statements and continuations, and other actions to perfect, protect, and continue the Administrative Agent’s Liens;
(v) sums paid or incurred to take any action required of any of the Borrower or Anixter under the Loan Documents that the Borrower or Anixter fails to pay or take; and
 
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(vi) forwarding loan proceeds, collecting checks and other items of payment, and establishing and maintaining the accounts and lock boxes, and costs and expenses of preserving and protecting the Collateral.
All of the foregoing fees, costs and expenses may be charged to the Borrower as Revolving Loans or to another deposit account, all as described in Section 2.18(c).
(b) Each of the Borrower and Anixter shall jointly and severally indemnify the Administrative Agent, the Issuing Bank and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “ Indemnitee ”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, penalties, incremental taxes, liabilities and related expenses, including the fees, charges and disbursements of any counsel for any Indemnitee (collectively, “ Indemnified Amounts ”), incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of:
(i) the execution or delivery of the Loan Documents or any agreement or instrument contemplated thereby, the performance by the Borrower of its obligations thereunder, the consummation of the Transactions or any other transaction contemplated hereby, and/or the enforcement of any rights or remedies of any Indemnitee provided under the Loan Documents, any agreement or instrument contemplated thereby or by any Requirement of Law;
(ii) any Loan or Letter of Credit or the use of the proceeds therefrom (including any refusal by the Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit);
(iii) the failure of the Borrower to deliver to the Administrative Agent the required receipts or other required documentary evidence with respect to a payment made by a Loan Party for Taxes pursuant to Section 2.17; and
(iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether or not such claim, litigation, investigation or proceeding is brought by the Borrower or any of its Affiliates or any other Person and whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, penalties, liabilities or related expenses are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee;
excluding, however, in all of the foregoing instances:
(i) Indemnified Amounts to the extent the same are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee;
(ii) Indemnified Amounts to the extent the same result from a dispute among Indemnitees that does not involve an action or omission by any member of the Consolidated Group and does not involve a claim against the Administrative Agent, the Issuing Bank, or any Lender in its capacity as such;
 
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(iii) Indemnified Amounts to the extent the same include losses in respect of Receivables that are uncollectible on account of the insolvency, bankruptcy, or lack of creditworthiness of the related Obligor or the financial inability of the related Obligor to pay; or
(iv) Excluded Taxes.
Without limiting the generality of the foregoing indemnification, the Borrower and Anixter shall indemnify each Indemnitee against, and hold each Indemnitee harmless from, any and all Indemnified Amounts incurred by or asserted against any Indemnitee (including losses in respect of uncollectible Receivables, regardless of whether reimbursement therefor would constitute recourse to the Borrower or Anixter) arising out of, in connection with, or as a result of:
(a) any representation or warranty made by the Borrower or any Originator (or any officers of any such Person) under or in connection with this Agreement, any other Loan Document or any other information or report delivered by any such Person pursuant hereto or thereto, which shall have been false or incorrect when made or deemed made;
(b) any failure by the Borrower or any Originator to comply with any applicable law, rule or regulation with respect to any Receivable or any related Contract, or the nonconformity of any Receivable or any related Contract with any such applicable law, rule or regulation or any failure of any Originator to keep or perform any of its obligations, express or implied, with respect to any Contract;
(c) any failure by the Borrower or any Originator to perform its duties, covenants or other obligations in accordance with the provisions of this Agreement or any other Loan Document;
(d) any products liability, personal injury or damage suit, or other similar claim arising out of or in connection with merchandise, or services that are the subject of any Receivable or any related Contract;
(e) any dispute, claim, offset or defense (other than discharge in bankruptcy of the Obligor) of the Obligor to the payment of any Receivable (including a defense based on such Receivable or the related Contract not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim resulting from the sale of the merchandise, or services that are the subject of such Receivable or the furnishing or failure to furnish such merchandise or services;
(f) the commingling by the Borrower of Collections of Receivables at any time with other funds;
(g) any investigation, litigation or proceeding related to or arising from this Agreement or any other Loan Document, the transactions contemplated hereby, the use of the proceeds of any Loan, the security interest in the Receivables or any other investigation, litigation or proceeding relating to the Borrower or any Originator in which any Indemnified Party becomes involved as a result of any of the transactions contemplated hereby;
(h) any inability to litigate any claim against any Obligor in respect of any Receivable as a result of such Obligor being immune from civil and commercial law and suit on the grounds of sovereignty or otherwise from any legal action, suit or proceeding;
 
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(i) any failure of the Borrower to acquire and maintain legal and equitable title to, and ownership of, any Receivable and the Related Security and Collections with respect thereto from the Seller, free and clear of any Lien (except as contemplated by the Loan Documents); or any failure of the Borrower to give reasonably equivalent value to Seller under the Receivables Sale Agreement in consideration of the transfer by the Seller of any Receivable, or any attempt by any Person to void such transfer under statutory provisions or common law or equitable action;
(j) any failure of Anixter to acquire and maintain legal and equitable title to, and ownership of, any Receivable and the Related Security and Collections with respect thereto from the applicable Originator free and clear of any Lien (except as contemplated by the Loan Documents); or any failure of Anixter to give reasonably equivalent value to any Originator under the related Receivables Transfer Agreement in consideration of the transfer by such Originator of any Receivable, or any attempt by any Person to void such transfer under statutory provisions or common law or equitable action;
(k) any Amortization Event described in Article IX, clauses (h), (i) and (j) has occurred;
(l) any failure to vest and maintain vested in the Administrative Agent for the benefit of the Lenders a first priority perfected security interest in the Receivables, and the Related Security and Collections with respect thereto, free and clear of any Lien (except as created by the Loan Documents);
(m) any failure to have filed, or any delay in filing, financing statements or other similar instruments or documents under the UCC of any applicable jurisdiction or other applicable laws with respect to any Receivable, or the Related Security and Collections with respect thereto, and the proceeds of any thereof;
(n) any action or omission by the Borrower which reduces or impairs the rights of the Administrative Agent or the Lenders with respect to any Receivable or the value of any Receivable;
(o) any attempt by any Person, other than a Lender, to void any Loan or Letter of Credit hereunder or the security interest of the Administrative Agent for the benefit of the Lenders in the Receivables, and the Related Security and Collections with respect thereto, created by the Loan Documents, in each case under statutory provisions or common law or equitable action; or
(p) the failure of any Receivable included as an Eligible Receivable on any Borrowing Base Certificate to be an Eligible Receivable as of the date of such Borrowing Base Certificate.
(c) The Servicer shall indemnify each Indemnitee against, and hold each Indemnitee harmless from, any and all Indemnified Amounts incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of the Servicer’s failure to duly and punctually perform its obligations under this Agreement or the Servicer’s activities hereunder, excluding, however:
(i) Indemnified Amounts to the extent the same are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee;
 
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(ii) Indemnified Amounts to the extent the same include losses in respect of Receivables that are uncollectible on account of the insolvency, bankruptcy, lack of creditworthiness or financial inability of the related Obligor or the unwillingness of the related Obligor to pay (other than in connection with a dispute giving rise to a Dilution); or
(iii) Excluded Taxes.
provided that nothing contained in this sentence shall limit the liability of the Servicer or limit the recourse of the Lenders to the Servicer for Collections received by the Servicer and required to be remitted by it under the terms of this Agreement.
Without limiting the generality of the foregoing indemnification, the Servicer shall indemnify each Indemnitee against, and hold each Indemnitee harmless from, any and all Indemnified Amounts incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of:
(a) any representation or warranty made by the Servicer (or any officers of the Servicer) under or in connection with this Agreement, any other Loan Document or any other information or report delivered by any such Person pursuant hereto or thereto, which shall have been false or incorrect when made or deemed made;
(b) any failure by the Servicer to comply with any applicable law, rule or regulation with respect to any Receivable or any related Contract;
(c) any failure by the Servicer to perform its duties, covenants or other obligations in accordance with the provisions of this Agreement or any other Loan Document;
(d) the commingling by the Servicer of Collections of Receivables at any time with other funds (except as contemplated by the Loan Documents);
(e) any investigation, litigation or proceeding relating to the Servicer in which any Indemnified Party becomes involved as a result of any of the transactions contemplated hereby; or
(f) any action or omission by the Servicer which reduces or impairs the rights of the Administrative Agent or the Lenders with respect to any Receivable or the value of any Receivable.
(d) After receipt by an Indemnitee of notice of any Proceedings involving such Indemnitee, such Indemnitee shall, if a claim in respect thereof is to be made against the Servicer hereunder, promptly notify the Servicer in writing, and in reasonable detail, of such Proceeding. Upon receipt of notice from an Indemnitee seeking indemnification hereunder with respect to any such Proceeding, the Servicer shall be entitled to assume the defense of any such Proceeding with counsel reasonably satisfactory to the Administrative Agent. Upon the Servicer’s assumption of the defense of any such Proceeding, the Indemnified Party shall have the right to participate in such Proceeding and to retain its own counsel but the Servicer shall not be liable for any legal expenses of other counsel subsequently incurred by such Indemnitee in connection with the defense thereof unless (x) the Servicer agrees in writing to pay such fees and expenses, (y) the Servicer fails to employ counsel reasonably satisfactory to the Administrative Agent in a timely manner, or (z) the Indemnitee shall have been advised by counsel that there are actual or potential conflicting interests between the Servicer, on the one hand, and the Indemnitee, on the other hand, including situations in which there are one or more legal defenses available to the Indemnitee that are different from or additional to those available to the Servicer; provided , however , that the Servicer
 
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shall not in any event be responsible hereunder for the fees and expenses of more than one counsel (plus local counsel, where necessary) for any Indemnitee in connection with any Proceeding. The Servicer shall have the sole authority to settle any claim for monetary damages and, if the Servicer chooses not to assume the defense of any such Proceeding, no Indemnitee will consent to a settlement of, or the entry of any judgment arising from, any Proceeding without the Servicer’s prior written consent, which shall not be unreasonably withheld or delayed.
(e) To the extent that the Borrower fails to pay any amount required to be paid by it to the Administrative Agent (or any sub-agent thereof), the Swingline Lender or the Issuing Bank (or any Related Party of any of the foregoing) under paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the Administrative Agent, the Swingline Lender or the Issuing Bank (or any Related Party of any of the foregoing), as the case may be, such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount (it being understood that the Borrower’s failure to pay any such amount shall not relieve the Borrower of any default in the payment thereof); provided that the unreimbursed expense or indemnified loss, claim, damage, penalty, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent, the Swingline Lender or the Issuing Bank in its capacity as such.
(f) To the extent permitted by applicable law, neither the Borrower nor Anixter shall assert, and the Borrower and Anixter each hereby waives, any claim against any Indemnitee, (i) for any damages arising from the use by others of information or other materials obtained through telecommunications, electronic or other information transmission systems (including the Internet), or (ii) on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document, or any agreement or instrument contemplated hereby or thereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof; provided that, nothing in this paragraph (f) shall relieve the Borrower or Anixter of any obligation it may have to indemnify an Indemnitee against special, indirect, consequential or punitive damages asserted against such Indemnitee by a third party.
(g) All amounts due under this Section shall be payable promptly after written demand therefor.
SECTION 11.04. Successors and Assigns .
(a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of the Issuing Bank that issues any Letter of Credit), except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of the Issuing Bank that issues any Letter of Credit), Participants (to the extent provided in paragraph (c) of this Section) and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more Persons (other than an Ineligible Institution) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment, participations in Letters of Credit and
 
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the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld) of:
(A) the Borrower, provided that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within ten (10) Business Days after having received notice thereof, provided further that no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an Amortization Event has occurred and is continuing, any other assignee, and provided further that the express written consent of the Borrower (which may be given or withheld in the sole discretion of the Borrower) shall at all times be required for any transfer or assignment to a Competitor;
(B) the Administrative Agent;
(C) the Issuing Bank; and
(D) the Swingline Lender.
(ii) Assignments shall be subject to the following additional conditions:
(A) except in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans of any Class, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000 unless each of the Borrower and the Administrative Agent otherwise consent, provided that no such consent of the Borrower shall be required if an Amortization Event has occurred and is continuing;
(B) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement;
(C) the parties to each assignment shall execute and deliver to the Administrative Agent (x) an Assignment and Assumption or (y) to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to a Platform as to which the Administrative Agent and the parties to the Assignment and Assumption are participants, together with a processing and recordation fee of $3,500;
(D) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire in which the assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about the Borrower, Anixter and their Related Parties or their respective securities) will be made available and who may receive such information in accordance with the assignee’s compliance procedures and applicable laws, including federal and state securities laws; and
(E) each assignment must be accompanied by an assignment of a proportionate part of all of the assigning Lender’s rights and obligations under the Inventory Facility Credit Agreement (including a proportionate part of the Inventory Facility Secured Obligations owed to such assigning Lender and a proportionate part of such assigning Lender’s “Commitment” under and as defined in the Inventory Facility Credit Agreement).
 
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For the purposes of this Section 11.04(b), the terms “ Approved Fund ”, “ Competitor ” and “ Ineligible Institution ” have the following meanings:
“ Approved Fund ” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
“ Competitor ” means any Person who is substantially engaged in the businesses of the Consolidated Group; provided that in no event shall any Person a predominant portion of whose business involves banking, insurance, investment banking, broker/dealer, investment or similar activities (including any Person involved in the life insurance business or in the business of the investment of annuities or contributions to pension, retirement, medical or similar plans or arrangements) be deemed a Competitor.
“ Ineligible Institution ” means a (a) natural person, (b) a Defaulting Lender or its Parent, (c) company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural person or relative(s) thereof; provided that, such company, investment vehicle or trust shall not constitute an Ineligible Institution if it (x) has not been established for the primary purpose of acquiring any Loans or Commitments, (y) is managed by a professional advisor, who is not such natural person or a relative thereof, having significant experience in the business of making or purchasing commercial loans, and (z) has assets greater than $25,000,000 and a significant part of its activities consist of making or purchasing commercial loans and similar extensions of credit in the ordinary course of its business or (d) the Borrower, Anixter or a Subsidiary or other Affiliate of Anixter.
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Section 2.15, Section 2.16, Section 2.17 and Section 11.03). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 11.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c) of this Section.
(iv) The Administrative Agent, acting for this purpose as a non-fiduciary agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount of the Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the “ Register ”). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent, the Issuing Bank and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower, the Issuing Bank and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
 
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(v) Upon its receipt of (x) a duly completed Assignment and Assumption executed by an assigning Lender and an assignee or (y) to the extent applicable, an agreement incorporating an Assignment and Assumption by reference pursuant to a Platform as to which the Administrative Agent and the parties to the Assignment and Assumption are participants, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 2.05, Section 2.06(d) or (e), Section 2.07(b), Section 2.18(d) or Section 11.03(c), the Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.
(c) Any Lender may, without the consent of the Borrower, the Administrative Agent, the Issuing Bank or the Swingline Lender, sell participations to one or more banks or other entities (a “ Participant ”) other than an Ineligible Institution in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged; (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations; and (C) the Borrower, the Administrative Agent, the Issuing Bank and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 11.02(b) that affects such Participant. The Borrower agrees that each Participant shall be entitled to the benefits of Section 2.15, Section 2.16 and Section 2.17 (subject to the requirements and limitations therein, including the requirements under Section 2.17(f) and (g) (it being understood that the documentation required under Section 2.17(f) shall be delivered to the participating Lender and the information and documentation required under Section 2.17(g) will be delivered to the Borrower and the Administrative Agent)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant (A) agrees to be subject to the provisions of Section 2.18 and Section 2.19 as if it were an assignee under paragraph (b) of this Section; and (B) shall not be entitled to receive any greater payment under Section 2.15 or Section 2.17, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation.
Each Lender that sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 2.19(b) with respect to any Participant. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 11.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.18(d) as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as an agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under this Agreement or any other Loan Document (the “ Participant Register ”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register
 
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(including the identity of any Participant or any information relating to a Participant’s interest in any Commitments, Loans, Letters of Credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Commitment, Loan, Letter of Credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.
(d) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
SECTION 11.05. Survival . All covenants, agreements, representations and warranties made by the Borrower and Anixter in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent, the Issuing Bank or any Lender may have had notice or knowledge of any Potential Amortization Event or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not expired or terminated. The provisions of Section 2.15, Section 2.16, Section 2.17, Section 11.03, Section 11.12 and Article X shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments or the termination of this Agreement or any other Loan Document or any provision hereof or thereof.
SECTION 11.06. Counterparts; Integration; Effectiveness; Electronic Execution .
(a) This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan Documents and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 5.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
(b) Delivery of an executed counterpart of a signature page of this Agreement by telecopy, emailed pdf. or any other electronic means that reproduces an image of the actual executed signature page shall be effective as delivery of a manually executed counterpart of this Agreement. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to any document to
 
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be signed in connection with this Agreement and the transactions contemplated hereby or thereby shall be deemed to include Electronic Signatures, deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.
SECTION 11.07. Severability . Any provision of any Loan Document held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions thereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
SECTION 11.08. Right of Setoff . If an Amortization Event shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against any of and all the Secured Obligations held by such Lender, irrespective of whether or not such Lender shall have made any demand under the Loan Documents and although such obligations may be unmatured. The applicable Lender shall notify the Borrower and the Administrative Agent of such set-off or application, provided that any failure to give or any delay in giving such notice shall not affect the validity of any such set-off or application under this Section. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.
SECTION 11.09. Governing Law; Jurisdiction; Consent to Service of Process .
(a) The Loan Documents (other than those containing a contrary express choice of law provision) shall be governed by and construed in accordance with the internal laws (and not the law of conflicts) of the State of Illinois (including, without limitation, 735 ILCS Section 105/5-1 et seq), but giving effect to federal laws applicable to national banks.
(b) Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any U.S. Federal or Illinois State court sitting in Cook County, Illinois in any action or proceeding arising out of or relating to any Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such Illinois State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent, the Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower and Anixter or any of its respective properties in the courts of any jurisdiction.
(c) Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
 
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(d) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 11.01. Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 11.10. WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, OTHER AGENT (INCLUDING ANY ATTORNEY) OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 11.11. Headings . Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
SECTION 11.12. Confidentiality . Each of the Administrative Agent, the Issuing Bank and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any Governmental Authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by any Requirement of Law or by any subpoena or similar legal process (and the Administrative Agent, Issuing Bank or Lender, as applicable, shall give notice to the Borrower thereof prior to such disclosure, to the extent that it is practicable to do so and to the extent that the disclosing party is permitted to provide such prior notice to the Borrower pursuant to the terms of such Requirement of Law or such subpoena or similar legal process), (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies under this Agreement or any other Loan Document or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and Anixter and their obligations, (g) with the consent of the Borrower, (h) to any Person providing a guarantee of all or any portion of the Secured Obligations, or (i) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section or (ii) becomes available to the Administrative Agent, the Issuing Bank or any Lender on a non-confidential basis from a source other than the Borrower. For the purposes of this Section, “ Information ” means all information received from the Borrower relating to the Borrower or its business, other than any such information that is available to the Administrative Agent, the Issuing Bank or any Lender on a non-confidential basis prior to disclosure by the Borrower and other than information pertaining to this Agreement routinely provided by arrangers to data service providers, including league table providers, that serve the lending industry. Any Person required to maintain the
 
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confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
SECTION 11.13. Several Obligations; Nonreliance; Violation of Law . The respective obligations of the Lenders hereunder are several and not joint and the failure of any Lender to make any Loan or perform any of its obligations hereunder shall not relieve any other Lender from any of its obligations hereunder. Each Lender hereby represents that it is not relying on or looking to any margin stock (as defined in Regulation U of the Board) for the repayment of the Borrowings provided for herein. Anything contained in this Agreement to the contrary notwithstanding, neither the Issuing Bank nor any Lender shall be obligated to extend credit to the Borrower in violation of any Requirement of Law.
SECTION 11.14. USA PATRIOT Act . Each Lender that is subject to the requirements of the USA PATRIOT Act hereby notifies the Borrower and Anixter that pursuant to the requirements of the USA PATRIOT Act, it is required to obtain, verify and record information that identifies the Borrower and Anixter, which information includes the name and address of such parties and other information that will allow such Lender to identify the Borrower or Anixter, as applicable, in accordance with the USA PATRIOT Act.
SECTION 11.15. Disclosure . The Borrower and Anixter and each Lender and the Issuing Bank hereby acknowledges and agrees that the Administrative Agent and/or its Affiliates from time to time may hold investments in, make other loans to or have other relationships with the Borrower and Anixter.
SECTION 11.16. Appointment for Perfection . Each Lender hereby appoints each other Lender as its agent for the purpose of perfecting Liens, for the benefit of the Administrative Agent and the other Secured Parties, in assets which, in accordance with Article 9 of the UCC or any other applicable law can be perfected only by possession or control. Should any Lender (other than the Administrative Agent) obtain possession or control of any such Collateral, such Lender shall notify the Administrative Agent thereof, and, promptly upon the Administrative Agent’s request therefor shall deliver such Collateral to the Administrative Agent or otherwise deal with such Collateral in accordance with the Administrative Agent’s instructions.
SECTION 11.17. Interest Rate Limitation . Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively the “ Charges ”), shall exceed the maximum lawful rate (the “ Maximum Rate ”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.
SECTION 11.18. Marketing Consent . The Borrower hereby authorizes Chase and its affiliates (including J.P. Morgan Securities LLC) (collectively, the “ Chase Parties ”), at their respective sole expense, and with the prior approval of the Borrower, to include the Borrower’s name and logo in advertising slicks posted on their internet sites, in pitchbooks or sent in mailings to prospective customers and to give such other publicity to this Agreement as each may from time to time determine in its sole
 
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discretion. Notwithstanding the foregoing, Chase Parties shall not publish the Borrower’s name in a newspaper or magazine without obtaining the Borrower’s prior written approval. The foregoing authorization shall remain in effect unless and until the Borrower notifies Chase in writing that such authorization is revoked.
[Signatures appear on the following pages]
 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective authorized officers as of the day and year first above written.

BORROWER:	
	
ANIXTER RECEIVABLES CORPORATION	
		
By:	 	/s/ Rodney Shoemaker	
Name:	 	Rodney Shoemaker	
Title:	 	Vice President – Treasurer	
	
INITIAL SERVICER:	
	
ANIXTER INC.	
		
By:	 	/s/ Rodney Shoemaker	
Name:	 	Rodney Shoemaker	
Title:	 	Senior Vice President – Treasurer	
 
Signature Page to Credit Agreement (Receivables Facility)

			
JPMORGAN CHASE BANK, N.A. , individually as a Lender, as Administrative Agent, Issuing Bank and Swingline Lender	
		
By:	 	/s/ Stephanie Lis	
Name:	 	Stephanie Lis	
	 	Its Authorized Signatory	
 
Signature Page to Credit Agreement (Receivables Facility)

			
WELLS FARGO BANK, NATIONAL ASSOCIATION , individually as a Lender and as an Issuing Bank	
		
By:	 	/s/ Anwar Young	
Name:	 	Anwar Young	
	 	Its Authorized Signatory	
 
Signature Page to Credit Agreement (Receivables Facility)

			
BANK OF AMERICA, N.A. , as a Lender	
		
By:	 	/s/ Donald A. Mastro	
Name:	 	Donald A. Mastro	
	 	Its Authorized Signatory	
 
Signature Page to Credit Agreement (Receivables Facility)

			
S UNTRUST BANK , as a Lender	
		
By:	 	/s/ Tighe A. Ittner	
Name:	 	Tighe A. Ittner	
	 	Its Authorized Signatory	
 
Signature Page to Credit Agreement (Receivables Facility)

			
PNC BANK, NATIONAL ASSOCIATION, as a Lender	
		
By:	 	/s/ Ajay Shulz	
Name:	 	Ajay Shulz	
	 	Its Authorized Signatory	
 
Signature Page to Credit Agreement (Receivables Facility)

COMMITMENT SCHEDULE
Commitments

Lender	  	Total Revolver Commitment	 	
JPMorgan Chase Bank, N.A.	  	$	170,000,000	  	
Wells Fargo Bank, National Association	  	$	170,000,000	  	
Bank of America, N.A.	  	$	120,000,000	  	
SunTrust Bank	  	$	80,000,000	  	
PNC Bank, National Association	  	$	60,000,000	  	
	  	 	 	 	
All Lenders	  	$	600,000,000	  	

Exhibit 10.2

 
THIRD AMENDED AND RESTATED
RECEIVABLES SALE AGREEMENT
Dated as of October 5, 2015
between
ANIXTER INC. ,
as Seller,
and
ANIXTER RECEIVABLES CORPORATION ,
as Buyer

 

Table of Contents

 	 	 	  	Page	 	
ARTICLE I	 	DEFINITIONS	  	 	1	  	
			
Section 1.01.	 	Defined Terms	  	 	1	  	
Section 1.02.	 	Terms Generally	  	 	8	  	
Section 1.03.	 	Accounting Terms; GAAP	  	 	9	  	
			
ARTICLE II	 	RECEIVABLE SALES; LETTERS OF CREDIT	  	 	9	  	
			
Section 2.01.	 	Reaffirmation of Prior Sales	  	 	9	  	
Section 2.02.	 	Receivable Sales	  	 	9	  	
Section 2.03.	 	Purchase Price	  	 	10	  	
Section 2.04.	 	Purchase Price Credit Adjustments	  	 	11	  	
Section 2.05.	 	Payments and Computations	  	 	12	  	
Section 2.06.	 	Transfer of Records	  	 	12	  	
Section 2.07.	 	Characterization	  	 	12	  	
Section 2.08.	 	Assumption and Issuance of Letters of Credit	  	 	13	  	
			
ARTICLE III	 	REPRESENTATIONS AND WARRANTIES	  	 	14	  	
			
Section 3.01.	 	Representations and Warranties of the Seller	  	 	14	  	
			
ARTICLE IV	 	CONDITIONS	  	 	17	  	
			
Section 4.01.	 	Conditions Precedent to Purchase	  	 	17	  	
Section 4.02.	 	Conditions Precedent to Subsequent Payments	  	 	17	  	
			
ARTICLE V	 	COVENANTS	  	 	17	  	
			
Section 5.01.	 	Affirmative Covenants of the Seller	  	 	17	  	
Section 5.02.	 	Negative Covenants of the Seller	  	 	21	  	
			
ARTICLE VI	 	TERMINATION OF PURCHASES; AMORTIZATION EVENT REMEDIES	  	 	22	  	
			
Section 6.01.	 	Voluntary Termination	  	 	22	  	
Section 6.02.	 	Automatic Termination	  	 	23	  	
Section 6.03.	 	Amortization Event Remedies	  	 	23	  	
			
ARTICLE VII	 	INDEMNIFICATION	  	 	23	  	
			
Section 7.01.	 	Indemnities by Seller	  	 	23	  	
Section 7.02.	 	Other Costs and Expenses	  	 	25	  	
			
ARTICLE VIII	 	MISCELLANEOUS	  	 	25	  	
			
Section 8.01.	 	Waivers and Amendments	  	 	25	  	
Section 8.02.	 	Notices	  	 	26	  	
Section 8.03.	 	Protection of Ownership Interest of Buyer	  	 	26	  	
Section 8.04.	 	Confidentiality	  	 	27	  	
Section 8.05.	 	No Bankruptcy Petition	  	 	27	  	
Section 8.06.	 	Limitation of Liability	  	 	28	  	
Section 8.07.	 	Governing Law; Jurisdiction; Consent to Service of Process	  	 	28	  	
Section 8.08.	 	WAIVER OF JURY TRIAL	  	 	28	  	
Section 8.09.	 	Integration; Binding Effect; Survival of Terms	  	 	29	  	
Section 8.10.	 	Counterparts; Severability	  	 	29	  	
 
i

					
SCHEDULES:	 		  		
			
Schedule A-1	 		  	Required Closing Documents (Delivered to the Buyer)	
Schedule A-2	 		  	Required Closing Documents (Delivered to the Seller)	
Schedule B	 		  	Collection Information	
Schedule C	 		  	Post-Closing Collection Account Requirements	
Schedule D	 	–	  	Subsidiary Originators	
Schedule E	 	–	  	Places of Business; Names	
			
EXHIBITS:	 		  		
			
Exhibit A	 	–	  	Form of Letter of Credit Request	
Exhibit B	 	–	  	Credit and Collection Policies	

THIRD AMENDED AND RESTATED
RECEIVABLES SALE AGREEMENT
THIRD AMENDED AND RESTATED RECEIVABLES SALE AGREEMENT dated as of October 5, 2015 (as it may be amended or modified from time to time, this “ Agreement ”) between ANIXTER INC. , a Delaware corporation (“ Anixter ”), as the Seller, and ANIXTER RECEIVABLES CORPORATION , a Delaware corporation (“ ARC ”), as the Buyer.
PRELIMINARY STATEMENTS
A. Anixter, as the seller, and ARC, as the buyer, are parties to that certain Second Amended and Restated Receivables Sale Agreement, dated as of May 31, 2011 (as the same has been amended, restated, modified or supplemented from time to time, the “ 2011 Receivables Sale Agreement ”), pursuant to which Anixter has sold and contributed to ARC certain Receivables originated or acquired by Anixter and the Related Security and Collections with respect thereto.
B. Anixter desires to continue to sell and contribute to ARC, and ARC desires to continue to purchase and acquire from Anixter, all Receivables originated or acquired by Anixter on or after the date hereof and the Related Security and Collections with respect thereto, in each case on the terms and subject to the conditions set forth herein.
C. ARC, as the borrower, and Anixter, as the servicer, propose to enter into a Credit Agreement dated as of the date hereof with JPMorgan Chase Bank, N.A., in its capacity as administrative agent, and the other financial institutions named therein pursuant to which such financial institutions will extend certain credit facilities to ARC secured by the Receivables purchased or acquired by ARC from Anixter pursuant to the 2011 Receivables Sale Agreement or this Agreement and the Related Security and Collections with respect thereto.
D. Anixter and ARC have agreed to amend and restate the 2011 Receivables Sale Agreement on the terms and subject to the conditions set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Defined Terms . As used in this Agreement, the following terms have the meanings specified below. All defined terms used herein without definition have the meanings assigned to such terms in the Credit Agreement.
“ 2011 Receivables Sale Agreement ” has the meaning assigned to such term in the preliminary statements to this Agreement.
“ Accu-Tech ” means Accu-Tech Corporation, a Georgia corporation.
“ Accu-Tech Transfer Agreement ” means that certain Amended and Restated Receivables Transfer Agreement, dated as of the date hereof, between Accu-Tech and the Seller, as the same may be amended, restated or otherwise modified from time to time.

“ Administrative Agent ” means JPMorgan Chase Bank, N.A., in its capacity as administrative agent for the Lenders under the Credit Agreement, and any successor administrative agent appointed pursuant to the Credit Agreement.
“ Affiliate ” means, as to any Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with, such Person. A Person shall be deemed to be “controlled by” any other Person if such other Person possesses, directly or indirectly, power (a) to vote 33% or more of the securities (on a fully diluted basis) having ordinary voting power for the election of directors or managing general partners; or (b) to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
“ Aggregate Credit Exposure ” has the meaning assigned to such term in the Credit Agreement.
“ Aggregate Revolving Exposure ” has the meaning assigned to such term in the Credit Agreement.
“ Amortization Date ” has the meaning assigned to such term in the Credit Agreement.
“ Amortization Event ” has the meaning assigned to such term in the Credit Agreement.
“ Applied Collections ” has the meaning assigned to such term in Section 2.03(d) .
“ Bankruptcy Event ” means, with respect to any Person, when such Person becomes the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business, appointed for it, or, in the good faith determination of the Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment, provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person with immunity from the jurisdiction of courts within the U.S. or from the enforcement of judgments or writs of attachment on its assets or permits such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.
“ Borrowing Base Reports ” has the meaning assigned to such term in Section 5.01(a)(ii) .
“ Business Day ” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed.
“ Buyer ” means Anixter Receivables Corporation, a Delaware corporation.
“ Calculation Period ” means each Fiscal Month or portion thereof which elapses during the term of this Agreement. The first Calculation Period shall commence on the date of the first Purchase of Receivables hereunder and the final Calculation Period shall terminate on the Amortization Date.
“ Collection Account ” means each concentration account, depositary account, lock-box account or similar account in which any Collections are collected or deposited and which is listed on Schedule B .
 
2

“ Collection Account Agreement ” means an agreement among the Buyer, the Servicer, the Administrative Agent and a Collection Bank perfecting the Administrative Agent’s security interest in one or more Collection Accounts.
“ Collection Bank ” means, at any time, any of the banks holding one or more Collection Accounts.
“ Collections ” means, with respect to any Receivable, all cash collections and other cash proceeds in respect of such Receivable, including, without limitation, all yield, Finance Charges or other related amounts accruing in respect thereof and all cash proceeds of Related Security with respect thereto.
“ Commitment(s) ” has the meaning assigned to such term in the Credit Agreement.
“ Company Owned Post Office Box ” means each locked postal box which is owned and maintained by the Buyer solely for the purpose of retrieving and processing payments made on certain of the Receivables by one or more of the Targets (as defined in the Credit Agreement).
“ Contract ” means a contract (including any purchase order or invoice) originally between an Originator and any Person pursuant to or under which such Person shall be obligated to make payments to such Originator with respect to the sale of goods or the furnishing of services from time to time. A “related” Contract with respect to a Receivable means a Contract under which such Receivable arises or which is relevant to the collection or enforcement of such Receivable.
“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.
“ Credit Agreement ” means the Credit Agreement dated as of the date hereof among the Buyer, the Servicer, the Administrative Agent, and the other financial institutions named therein, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“ Credit and Collection Policy ” means (a) the Seller’s credit and collection policies and practices relating to Contracts and Receivables existing on the date hereof, (b) the credit and collection policies and practices of any Subsidiary Originator relating to Contracts and Receivables existing on the date hereof and (c) the credit and collection policies and practices of any other Originator relating to Contracts and Receivables existing on the date on which such other Originator was approved by the Administrative Agent, in each case as summarized in Exhibit B and as modified from time to time in accordance with this Agreement.
“ Default Rate ” means, for any day, a rate per annum equal to the sum of (i) the rate applicable on such day to ABR Revolving Loans under and as defined in the Credit Agreement (including any increase in such rate which may apply pursuant to Section 2.13(d) of the Credit Agreement) plus (ii) 2% per annum.
“ Discount Factor ” means a percentage calculated to provide the Buyer with a reasonable return on its investment in the Receivables after taking account of (a) the time value of money based upon the anticipated dates of collection of the Receivables and the cost to the Buyer of financing its investment in the Receivables during such period and (b) the risk of nonpayment by the Obligors. The Seller and the Buyer may agree from time to time to change the Discount Factor based on changes in one or more of the items affecting the calculation thereof; provided that any change to the Discount Factor shall take effect as of the commencement of a Calculation Period, shall apply only prospectively and shall not affect the Purchase Price payment in respect of any Purchase which occurred during any Calculation Period ending prior to the Calculation Period during which the Seller and the Buyer agreed to make such change.
 
3

“ Eligible Receivable ” has the meaning assigned to such term in the Credit Agreement.
“ Facility Termination Date ” means the earlier of (a) the Maturity Date and (b) the Amortization Date.
“ Finance Charges ” means, with respect to any Contract, any finance, interest, late payment charges or similar charges owing by an Obligor pursuant to such Contract.
“ Fiscal Month ” means a four or five week monthly accounting period of the Seller ending on or about the last day of a calendar month.
“ GAAP ” means generally accepted accounting principles in the U.S. set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the U.S., that are applicable to the circumstances as of the date of determination, consistently applied.
“ Governmental Authority ” means the government of the U.S., any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
“ Inventory Facility Administrative Agent ” means Wells Fargo, in its capacity as the “Administrative Agent” under and as defined in the Inventory Facility Credit Agreement, and any successor to Wells Fargo, in that capacity.
“ Inventory Facility Credit Agreement ” means the Credit Agreement dated as of the date hereof among the Seller, the Subsidiaries of the Seller party thereto, the Inventory Facility Administrative Agent, and the other financial institutions named therein, as the same may be amended or replaced from time to time.
“ Issuing Bank ” means, with respect to any Letter of Credit, the issuer of such Letter of Credit.
“ LC Disbursement ” means any payment made by an Issuing Bank pursuant to a Letter of Credit.
“ Lenders ” has the meaning assigned to such term in the Credit Agreement.
“ Letter of Credit ” means any letter of credit issued pursuant to the Credit Agreement and described in a Letter of Credit Request delivered by the Seller to the Buyer pursuant to Section 2.08 .
“ Letter of Credit Request ” means a letter of credit application or request substantially the form of Exhibit A (appropriately completed), delivered by the Seller to the Buyer.
“ Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement, the interest of a lessor under a capital lease, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of any financing statement under the Uniform Commercial Code or comparable laws of any jurisdiction), including the interest of a purchaser of accounts receivable.
 
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“ Loans ” has the meaning assigned to such term in the Credit Agreement.
“ Lock-Box ” means each locked postal box with respect to which a bank who has executed a Collection Account Agreement has been granted exclusive access for the purpose of retrieving and processing payments made on the Receivables and which is listed on Schedule B .
“ Material Adverse Effect ” means (a) a material adverse change in, or a material adverse effect upon, the operations, assets, liabilities (actual or contingent), business, properties, financial condition or prospects of the Seller and its Subsidiaries taken as a whole; (b) a material impairment of the ability of the Seller to perform its obligations under this Agreement or any other Transaction Document; (c) a material adverse effect upon the legality, validity, binding effect, or enforceability against the Seller of this Agreement or any other Transaction Document or the rights and remedies of the Buyer under this Agreement or any other Transaction Document; (d) a material adverse change in, or a material adverse effect on, the interest of the Buyer, the Administrative Agent or any Lender in the Receivables generally or in any material portion of the Receivables, or in the Related Security or Collections with respect thereto; or (e) a material adverse effect on the collectability of the Receivables generally or any material portion of the Receivables.
“ Maturity Date ” has the meaning assigned to such term in the Credit Agreement.
“ Net Worth ” means, as of any date, the excess, if any, of (a) the aggregate Outstanding Balance of the Receivables as of the last Business Day of the preceding Fiscal Month, over (b) the sum of (i) the Aggregate Revolving Exposure as of such date plus (ii) the aggregate outstanding principal balance of the Subordinated Loans as of such date (including any Subordinated Loan proposed to be made on such date).
“ Obligor ” means any Person obligated to make payments pursuant to a Contract.
“ Original Balance ” means, with respect to any Receivable, the Outstanding Balance of such Receivable on the date it was purchased by the Buyer.
“ Originator ” means (a) the Seller, (b) each Subsidiary Originator and (c) any other Person approved in writing from time to time by the Administrative Agent, in each case in such Person’s capacity as a “Seller” party to this Agreement or any Receivables Transfer Agreement.
“ Outstanding Balance ” means, with respect to any Receivable at any time, the then outstanding principal balance thereof.
“ Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
“ Potential Amortization Event ” means any event or condition which constitutes an Amortization Event or which upon notice, lapse of time or both would, unless cured or waived, become an Amortization Event.
“ Purchase ” means the purchase or acquisition under this Agreement by the Buyer from the Seller of the Receivables, and the Related Security and Collections with respect thereto, together with all related rights in connection therewith.
 
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“ Purchase Price ” means, with respect to any Purchase on any date, the aggregate price to be paid by the Buyer to the Seller for such Purchase in accordance with Section 2.02 for the Receivables, and the Related Security and Collections with respect thereto, being sold to the Buyer on such date, which price shall equal (a) the product of (i) the Original Balance of such Receivables, multiplied by (ii) one minus the Discount Factor then in effect, minus (b) any Purchase Price Credits to be credited against the Purchase Price otherwise payable in accordance with Section 2.03 .
“ Purchase Price Credit ” has the meaning assigned to such term in Section 2.04 .
“ Receivables ” means the indebtedness and other obligations owed to the Seller or any other Originator (before giving effect to any transfer or conveyance under the related Receivables Transfer Agreement or this Agreement) or the Buyer (after giving effect to any transfer or conveyance under the related Receivables Transfer Agreement and this Agreement), whether constituting an account, chattel paper, instrument or general intangible, arising in connection with the sale of goods or the rendering of services by an Originator and includes the obligation to pay any Finance Charges with respect thereto. All indebtedness and other rights and obligations arising from any one transaction, including indebtedness and other rights and obligations represented by an individual invoice, shall constitute a Receivable separate from a Receivable consisting of the indebtedness and other rights and obligations arising from any other transaction; provided that any indebtedness, rights or obligations referred to in the preceding sentence shall be a Receivable regardless of whether the Obligor or the Seller treats such indebtedness, rights or obligations as a separate payment obligation.
“ Receivables Transfer Agreement ” means (a) any Subsidiary Originator Transfer Agreement, and (b) any other receivables transfer agreement entered into from time to time by and between the Seller, as the Buyer, and any other Originator, as the Seller, in each case as the same may be amended, restated or otherwise modified from time to time.
“ Records ” means, with respect to any Receivable, all Contracts and other documents, books, records and other information (including computer programs, tapes, disks, punch cards, data processing software and related property and rights) relating to such Receivable, any Related Security therefor and the related Obligor.
“ Related Security ” means, with respect to any Receivable:
(i) all of the related Originator’s interest in the inventory and goods (including returned or repossessed inventory or goods), if any, the sale of which by such Originator gave rise to such Receivable, and all insurance contracts with respect thereto;
(ii) all other security interests or liens and property subject thereto from time to time, if any, purporting to secure payment of such Receivable, whether pursuant to the related Contract or otherwise, together with all financing statements and security agreements describing any collateral securing such Receivable;
(iii) all guaranties, letters of credit, insurance and other agreements or arrangements of whatever character from time to time supporting or securing payment of such Receivable whether pursuant to the related Contract or otherwise;
(iv) all service contracts and other contracts and agreements associated with such Receivable;
(v) all Records related to such Receivable;
 
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(vi) all of the Seller’s right, title and interest in, to and under the related Receivables Transfer Agreement, if applicable; and
(vii) all proceeds of any of the foregoing.
“ Required Capital Amount ” means, at any time, an amount equal to 3.5% of the Outstanding Balance of the Receivables at such time.
“ Requirement of Law ” has the meaning assigned to such term in the Credit Agreement.
“ Security Agreement ” has the meaning assigned to such term in the Credit Agreement.
“ Seller ” means Anixter Inc., a Delaware corporation.
“ Servicer ” means, at any time, the Person (which may be the Administrative Agent) then authorized pursuant to Article VIII of the Credit Agreement to service, administer and collect the Receivables.
“ Settlement Date ” means the second day of each calendar month, or, if such day is not a Business Day, the next succeeding Business Day.
“ Solvent ” means, when used with respect to any Person, that at the time of determination:
(i) the fair value of its assets (both at fair valuation and at present fair saleable value) is equal to or in excess of the total amount of its liabilities, including contingent liabilities;
(ii) it is then able and expected to be able to pay its debts as they mature; and
(iii) it has capital sufficient to carry on its business as conducted and as proposed to be conducted.
With respect to contingent liabilities (such as litigation, guarantees and pension plan liabilities), such liabilities shall be computed at the amount which, in light of all the facts and circumstances existing at the time, represent the amount which can reasonably be expected to become an actual or matured liability.
“ Subordinated Loan ” has the meaning assigned to such term in Section 2.03(b)(ii) .
“ Subordinated Note ” means that certain Third Amended and Restated Subordinated Note, dated as of the date hereof, executed by the Buyer and made payable to the order of the Seller, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“ Subordinated Security Agreement ” means that certain Security Agreement dated as of the date hereof between the Seller and the Buyer, as the same may be amended, restated or otherwise modified from time to time.
“ Subordination Agreement ” means that certain Subordination and Intercreditor Agreement dated as of the date hereof between the Seller and the Buyer, as the same may be amended, restated, supplemented or otherwise modified from time to time.
 
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“ Subscription Agreement ” means that certain Stockholder and Subscription Agreement, dated as of October 6, 2000, between the Seller and the Buyer, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“ Subsidiary Originator ” means (a) Accu-Tech, (b) each subsidiary of the Seller identified on Schedule D and (c) any other subsidiary of the Seller approved in writing from time to time by the Administrative Agent (evidenced by an amended or modified Schedule D ).
“ Subsidiary Originator Transfer Agreement ” means (a) the Accu-Tech Transfer Agreement and (b) any other receivables transfer agreement entered into from time to time by and between the Seller, as the buyer, and any other Subsidiary Originator, as the seller, in each case as the same may be amended, restated or otherwise modified from time to time.
“ Transaction Documents ” means, collectively, this Agreement, each Subsidiary Originator Transfer Agreement, the Subordinated Note, the Subscription Agreement, the Subordination Agreement, the Subordinated Security Agreement, and all other instruments, documents and agreements executed and delivered in connection herewith.
“ UCC ” means the Uniform Commercial Code as in effect from time to time in the State of Illinois or in any other state the laws of which are required to be applied in connection with the issue of perfection of security interests.
“ U.S. ” means the United States of America.
“ Wells Fargo ” means Wells Fargo Bank, National Association, a national banking association.
SECTION 1.02. Terms Generally . The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “law” shall be construed as referring to all statutes, rules, regulations, codes and other laws (including official rulings and interpretations thereunder having the force of law or with which affected Persons customarily comply) and all judgments, orders and decrees of all Governmental Authorities. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, restatements, supplements or modifications set forth herein), (b) any definition of or reference to any statute, rule or regulation shall be construed as referring thereto as from time to time amended, supplemented or otherwise modified (including by succession of comparable successor laws), (c) any reference herein to any Person shall be construed to include such Person’s successors and assigns (subject to any restrictions on assignments set forth herein) and, in the case of any Governmental Authority, any other Governmental Authority that shall have succeeded to any or all functions thereof, (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (f) any reference in any definition to the phrase “at any time” or “for any period” shall refer to the same time or period for all calculations or determinations within such definition, and (g) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.
 
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SECTION 1.03. Accounting Terms; GAAP . Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time.
ARTICLE II
Receivable Sales; Letters of Credit
SECTION 2.01. Reaffirmation of Prior Sales . Pursuant to the 2011 Receivables Sale Agreement, the Seller has sold or contributed to the Buyer, without recourse (except to the extent expressly provided therein), and the Buyer has purchased or acquired from the Seller, all of the Seller’s right, title and interest in, to and under all Receivables existing as of the close of business on May 30, 2011 and all Receivables arising thereafter, whether then owned or thereafter originated or acquired by the Seller, in each case together with all Related Security and Collections with respect thereto. The Seller and the Buyer hereby reaffirm such sale and contribution.
SECTION 2.02. Receivable Sales . (a) On the terms and subject to the conditions set forth herein, the Seller does hereby sell or contribute to the Buyer, without recourse (except to the extent expressly provided herein), and the Buyer does hereby purchase or acquire from the Seller, all of the Seller’s right, title and interest in, to and under all Receivables existing on the date of this Agreement and all Receivables arising thereafter through and including the Facility Termination Date, whether now owned or hereafter originated or acquired by the Seller, in each case together with all Related Security and Collections with respect thereto. All of the Receivables existing at the opening of business on the date of this Agreement are hereby sold or contributed, as applicable, to the Buyer on such date in accordance with the terms hereof. On and after the date of this Agreement until the Facility Termination Date, each Receivable shall be sold or contributed, as applicable, to the Buyer immediately (and without further action by any Person) upon the origination or acquisition of such Receivable by the Seller. The Related Security with respect to each Receivable shall be sold or contributed, as applicable, at the same time as such Receivable, whether such Related Security exists at such time or arises thereafter (it being understood that such Related Security comprises an integral part of such sale or contribution). The Seller hereby relinquishes all title and control over each such Receivable upon the transfer of such Receivable to the Buyer hereunder. The Seller shall not sell or contribute Receivables to the Buyer on or after the Facility Termination Date.
(b) The Seller and the Buyer intend that each sale or contribution of Receivables made hereunder shall constitute a “sale of accounts” (as such term is used in Article 9 of the UCC), which sale is absolute and irrevocable and provides the Buyer with the full benefits of ownership of the Receivables. Except for the Purchase Price Credits owed pursuant to Section 2.04, each sale or contribution of Receivables hereunder is made without recourse to the Seller, provided that (i) the Seller shall be liable to the Buyer for all representations, warranties and covenants made by the Seller pursuant to the terms of the Transaction Documents to which the Seller is a party, and (ii) no such sale or contribution constitutes or is intended to result in an assumption by the Buyer or any assignee thereof of any obligation of the Seller or any other Person arising in connection with the Receivables, the related Contracts and/or any other Related Security with respect thereto or any other obligations of the Seller. In view of the intention of the parties hereto that each sale or contribution of Receivables made hereunder shall constitute a sale of such Receivables rather than loans secured thereby, the Seller agrees that it will, on or prior to the date hereof and in accordance with Section 5.01(e)(ii), cause all Receivable reports relating to the Receivables to bear a legend acceptable to the Buyer and the Administrative Agent evidencing that the Buyer has purchased or acquired such Receivables as provided in this Agreement and note in its financial statements that its Receivables have been sold to the Buyer. Upon the request of the Buyer or the Administrative Agent, the Seller will execute and file such financing or continuation statements, or amendments thereto or
 
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assignments thereof, and such other instruments or notices, as may be necessary or appropriate to perfect and maintain the perfection of the Buyer’s ownership interest in the Receivables, and the Related Security and Collections with respect thereto, or as the Buyer or the Administrative Agent may reasonably request.
SECTION 2.03. Purchase Price . (a) The Purchase Price for each Receivable originated or acquired by the Seller on or after the date of this Agreement shall be due and payable in full by the Buyer to the Seller or its designee on the related origination or acquisition date (except that the Buyer may offset against any such Purchase Price any amounts owed by the Seller to the Buyer hereunder which have become due but remain unpaid). The Purchase Price for each Receivable shall be paid to the Seller in the manner provided in the following paragraphs (b), (c), (d) and (e). In connection with the payment of the Purchase Price for any Receivable purchased hereunder, the Seller shall deliver to the Buyer such approvals, opinions, information, reports or documents as the Buyer may reasonably request.
(b) On each Settlement Date, the Buyer shall pay the Purchase Price for each Receivable originated or acquired by the Seller on or after the date of this Agreement in accordance with Section 2.03(d) and (e) and in the following manner:
(i) first , by delivery of immediately available funds, to the extent of funds available to the Buyer from (A) a borrowing under the Credit Agreement, (B) Collections with respect to Receivables previously sold to the Buyer which are available to the Buyer under the terms of the Credit Agreement, or (C) other cash on hand;
(ii) second , by delivery of the proceeds of a subordinated revolving loan from the Seller to the Buyer (a “ Subordinated Loan ”); provided that the making of any such Subordinated Loan shall be subject to the provisions set forth in below; and
(iii) third , unless the Amortization Date has occurred, by accepting a contribution to its capital pursuant to the Subscription Agreement in an amount equal to the remaining unpaid balance of such Purchase Price.
(c) The amount that can be borrowed by the Buyer pursuant to clause (ii) of paragraph (b) above is limited to the amount that could be borrowed without causing the Net Worth to be less than the Required Capital Amount. The Seller is hereby authorized by the Buyer to endorse on the schedule attached to the Subordinated Note an appropriate notation evidencing the date and amount of each advance thereunder, as well as the date of each payment with respect thereto; provided that any failure by the Seller to make any such notation shall not affect any obligation of the Buyer thereunder. Subject to the limitations set forth in the second preceding sentence, the Seller irrevocably agrees to advance each Subordinated Loan requested by the Buyer on or prior to the Facility Termination Date. The Subordinated Loans shall be evidenced by, and shall be payable in accordance with the terms and provisions of the Subordinated Note and shall be payable solely from funds which the Buyer is not required by the terms of the Credit Agreement to set aside for the benefit of, or otherwise pay over to, the Lenders, the Administrative Agent, or any other Person. The Seller shall provide upon request to the Buyer or the Administrative Agent a report with respect to any Settlement Date setting forth the portion, if any, of the related Purchase Price paid pursuant to a Subordinated Loan and the portion, if any, of the related Purchase Price treated as a contribution to capital.
(d) On each day prior to the Amortization Date (unless the Buyer or the Administrative Agent shall otherwise direct), the Buyer may permit the Seller to retain all or a specified portion of the Collections received with respect to the Receivables purchased or acquired by the Buyer hereunder, it being understood that any such Collections in the possession of the Seller or the Buyer must be applied in accordance with the Credit Agreement and are made available to the Buyer at the discretion of the
 
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Administrative Agent. Any such Collections so retained by the Seller (“ Applied Collections ”) shall, on and as of the date of receipt thereof, (i)  first , be deemed to have been applied towards the Purchase Price of any Receivables originated or acquired by the Seller and sold to the Buyer on such date, to the extent of any such Purchase Price, (ii)  second , to the extent of any remaining balance, be deemed to have been applied toward the Purchase Price of any other Receivables originated or acquired by the Seller during the preceding Calculation Period and in respect of which the Purchase Price shall not theretofore have been paid, to the extent of any such Purchase Price, and (iii)  third , to the extent of any remaining balance, be held in trust by the Seller for the benefit of the Buyer until the earlier to occur of (A) application toward the Purchase Price for any Purchase occurring on any later date and (B) the next following Settlement Date, in which case such amount shall be remitted to the Buyer.
(e) Although the Purchase Price for each Receivable originated or acquired by the Seller on or after the date of this Agreement shall be due and payable in full by the Buyer to the Seller on the related origination or acquisition date, and although payment of each Purchase Price shall be made from Applied Collections, to the extent available, as provided in paragraph (d) of this Section, final settlement of each Purchase Price between the Buyer and the Seller shall be effected on a monthly basis on each Settlement Date with respect to all Receivables originated or acquired by the Seller during the second preceding Calculation Period. On each Settlement Date, the Buyer and the Seller shall cause a reconciliation to be made in respect of all Purchases made during the second preceding Calculation Period. To the extent that the aggregate amount of Applied Collections retained by the Seller during such Calculation Period was less than the aggregate Purchase Price in respect of all Purchases made by the Buyer during such Calculation Period, the Buyer shall pay the balance due in respect of such aggregate Purchase Price in the manner described in paragraph (b) of this Section. To the extent that the aggregate amount of Applied Collections retained by the Seller during such Calculation Period was greater than the aggregate Purchase Price in respect of all Purchases made by the Buyer during such Calculation Period, the Seller shall turn over such excess to the Buyer either by remitting such excess in immediately available funds to the Buyer or by reducing the outstanding balance of the Subordinated Loans in an amount equal to such excess, or a combination of both. Although final settlement of each Purchase Price shall be effected on each Settlement Date, any increase or decrease in the amount owing under the Subordinated Note made pursuant to paragraph (b) of this Section and any contribution of capital by the Seller to the Buyer made pursuant to paragraph (b) of this Section shall be deemed to have occurred and shall be effective as of the last Business Day of the second preceding Calculation Period.
(f) At all times prior to the Amortization Date, notwithstanding any delay in the making of any payment of the Purchase Price in respect of any Purchase, all of the Seller’s right, title and interest in, to and under each Receivable shall be sold or contributed, as applicable, to the Buyer effective immediately and automatically upon the origination or acquisition of such Receivable by the Seller, without any further action of any type or kind being required on the part of any Person. The monthly settlement and reconciliation contemplated in this Section has been devised solely for the administrative convenience of the parties hereto, and the Buyer and the Seller may agree at any time to effect settlement and reconciliation on a more (but not less) frequent basis.
SECTION 2.04. Purchase Price Credit Adjustments . If on any date:
(i) the Outstanding Balance of any Receivable is reduced as a result of any defective or rejected goods or services, any discount or any adjustment or otherwise by the Seller (other than cash Collections on account of such Receivable or as a result of the insolvency, bankruptcy or lack of creditworthiness of the related Obligor or the financial inability of the related Obligor to pay);
 
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(ii) the Outstanding Balance of any Receivable is reduced or canceled as a result of a setoff in respect of any claim by any Person (whether such claim arises out of the same or a related transaction or an unrelated transaction); or
(iii) any of the representations or warranties set forth in paragraphs (k), (s), and (t) of Section 3.01 are not true when made or deemed made with respect to any Receivable;
then, in such event, the Buyer shall be entitled to a credit (each, a “ Purchase Price Credit ”), in an amount equal to the Outstanding Balance of such Receivable as of such date, against the Purchase Price otherwise payable hereunder for Receivables originated or acquired by the Seller on such date. If such Purchase Price Credit exceeds the aggregate Original Balance of the Receivables originated or acquired by the Seller on such date, then the Seller shall pay the remaining amount of such Purchase Price Credit in cash within two (2) Business Days thereafter; provided that if the Amortization Date has not occurred, the Seller may deduct the remaining amount of such Purchase Price Credit from any indebtedness owed to it under the Subordinated Note on the next Settlement Date.
SECTION 2.05. Payments and Computations . All amounts to be paid or deposited by the Buyer hereunder shall be paid or deposited in accordance with the terms hereof on the date when due in immediately available funds to the account of the Seller designated from time to time by the Seller or as otherwise directed by the Seller. If any payment owed by any Person hereunder becomes due on a day that is not a Business Day, then such payment shall be made on the next succeeding Business Day. If any Person fails to pay any amount hereunder when due, then such Person agrees to pay, on demand, interest on such amount at a rate per annum equal to the then applicable Default Rate until such amount is paid in full; provided that the Default Rate shall not at any time exceed the maximum rate permitted by applicable law. All computations of interest payable hereunder shall be made on the basis of a year of 360 days for the actual number of days (including the first day but excluding the last day) elapsed.
SECTION 2.06. Transfer of Records . (a) The Seller hereby sells, transfers, assigns and otherwise conveys to the Buyer all of the Seller’s right, title and interest in, to and under the Records relating to all Receivables sold or contributed hereunder, without the need for any further documentation in connection with any related Purchase. In connection with such conveyance, the Seller hereby grants to each of the Buyer, the Administrative Agent and the Servicer an irrevocable, non-exclusive license to use, without royalty or payment of any kind, all software used by the Seller to account for the Receivables to the extent necessary to administer the Receivables, whether such software is owned by the Seller or is owned by others and used by the Seller under license agreements with respect thereto; provided that should the consent of any third-party licensor be required in connection with the grant of any such license, the Seller hereby agrees that, upon the request of the Buyer or the Administrative Agent, the Seller will use its reasonable efforts to obtain such consent. The license granted hereby shall be irrevocable, and shall terminate on the date this Agreement terminates in accordance with its terms.
(b) The Seller shall (i) from time to time, take such action as may be requested by the Buyer or the Administrative Agent to ensure that the Buyer has an enforceable ownership interest in the Records relating to the Receivables sold or contributed to the Buyer and that the Administrative Agent, on behalf of the Lenders, has a valid and perfected first priority security interest in such Records and (ii) use its reasonable efforts to ensure that each of the Buyer, the Administrative Agent and the Servicer has an enforceable right (whether by license, sublicense or otherwise) to use all of the computer software used by the Seller to account for such Receivables and/or to recreate such Records.
SECTION 2.07. Characterization . If, notwithstanding the intention of the parties expressed in Section 2.02(b) , any sale or contribution of Receivables hereunder shall be characterized as a secured loan and not as a sale or such sale shall for any reason be ineffective or unenforceable (any of the foregoing
 
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being a “ Recharacterization ”), then this Agreement shall be deemed to constitute a security agreement under the UCC and other applicable law. For this purpose and without being in derogation of the parties’ intention that the sale or contribution of Receivables hereunder shall constitute a true sale thereof, the Seller hereby grants to the Buyer a duly perfected security interest in all of the Seller’s right, title and interest in, to and under all Receivables now existing or hereafter arising, all Related Security and Collections with respect thereto, all Records with respect thereto, each Lock-Box and Collection Account, each Receivables Transfer Agreement, all other rights and payments relating to such Receivables and all proceeds of the foregoing, which security interest shall be prior to all other Liens. In the event of a Recharacterization, and after the occurrence of an Amortization Event, (i) the Buyer or the Administrative Agent may declare the related secured loan to be due and payable, whereupon the unpaid principal amount of such secured loan, together with accrued interest thereon at a rate per annum equal to the then applicable Default Rate, and all fees and other obligations of the Seller accrued hereunder, shall become due and payable immediately, and (ii) the Buyer shall have, in addition to the rights and remedies which it may have under this Agreement, all other rights and remedies provided to a secured creditor after default under the UCC and other applicable law, which rights and remedies shall be cumulative. In the event of a Recharacterization, each of the Seller and the Buyer represents and warrants as to itself that each remittance of Collections by the Seller to the Buyer hereunder will have been (A) in payment of a debt incurred by the Seller in the ordinary course of business or financial affairs of the Seller and the Buyer and (B) made in the ordinary course of business or financial affairs of the Seller and the Buyer.
SECTION 2.08. Assumption and Issuance of Letters of Credit . (a) The Seller may, from time to time prior to the Facility Termination Date, deliver a Letter of Credit Request to the Buyer requesting that the Buyer obtain and deliver the letter of credit described in such Letter of Credit Request or renew, extend, increase, decrease or otherwise modify an outstanding Letter of Credit. If the Seller delivers a Letter of Credit Request to the Buyer and pays to the Buyer the applicable LC Commission on or before the related issuance or modification date (and such issuance or modification date is prior to the Facility Termination Date), subject to the terms of the Credit Agreement, the Buyer will endeavor to obtain and deliver the letter of credit described in such Letter of Credit Request or modify the related Letter of Credit in accordance with such Letter of Credit Request, provided that the outstanding principal balance of the Subordinated Loans owing to the Seller at the time of such issuance or modification must equal or exceed the aggregate undrawn amount of all outstanding Letters of Credit (after giving effect to such issuance or modification). The Seller may, subject to the terms of the Credit Agreement, request that the Buyer arrange for the extension of the expiration date of any Letter of Credit, but the duration of such extension may not exceed one year and must otherwise comply with the Credit Agreement.
(b) The Seller hereby absolutely and unconditionally agrees to reimburse the Buyer on demand for (i) all transactional fees and expenses of the related Issuing Bank payable by the Buyer pursuant to the related Letter of Credit application in connection with the issuance or modification of any Letter of Credit and (ii) if any Letter of Credit is drawn, all related LC Disbursements, together with interest on the unreimbursed amount until paid at a rate per annum equal to the rate then applicable to ABR Revolving Loans under and as defined in the Credit Agreement (including any increase in such rate which may apply pursuant to Section 2.13(d) of the Credit Agreement); provided that the Buyer may only demand reimbursement pursuant to this Section if the Lenders are not obligated to make Loans under the Credit Agreement on the date on which payment of such transactional fees and expenses or reimbursement of such LC Disbursements is due (or to the extent that the Buyer would not otherwise be able to offset or deduct such amounts pursuant to the following sentence). Without in any way limiting the Buyer’s rights to reimbursement hereunder, the Buyer may, on any date on which payment of such transactional fees and expenses or reimbursement of such LC Disbursements is due (even if the Buyer would otherwise be permitted to demand reimbursement pursuant to this Section on such date), offset the amounts described in the preceding sentence against the outstanding principal balance owing by the Buyer to the Seller on such date under the Subordinated Note or deduct such amounts from the Purchase
 
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Price otherwise payable by the Buyer to the Seller on such date pursuant to this Agreement. The Buyer shall promptly notify the Seller of any such offset or deduction. If any amount offset or deducted by the Buyer pursuant to this Section is subsequently reimbursed by the Seller, such offset or deduction shall automatically be reversed.
(c) The Seller’s obligation to reimburse transactional fees and expenses and LC Disbursements as provided in paragraph (b) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein or herein, (ii) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) any payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Seller’s obligations thereunder.
(d) If the Seller delivers a Letter of Credit Request to the Buyer pursuant to paragraph (a) of this Section requesting that the Buyer arrange for the extension of the expiration date of any Letter of Credit, the Buyer shall endeavor to obtain and deliver such extension not later than the fifth (5th) Business Day prior to the date on which such Letter of Credit is scheduled to expire. If the related Issuing Bank agrees to such extension in accordance with the terms of the Credit Agreement, the Seller shall pay the Buyer the applicable LC Commission for the extended period. Any such payment may be made in cash, through an offset against the outstanding principal balance owing by the Buyer to the Seller under the Subordinated Note or through a reduction in the Purchase Price otherwise payable by the Buyer to the Seller pursuant to this Agreement.
(e) At any time there is more than one Lender under the Credit Agreement and that Lender is not also the Issuing Bank, while any Letter of Credit remains outstanding, the Seller shall pay to the Buyer in arrears on each Settlement Date the Seller’s ratable share of a fully-earned and non-refundable fee equal to any fronting fee charged by the Issuing Bank with respect to such Letter of Credit.
ARTICLE III
Representations and Warranties
SECTION 3.01. Representations and Warranties of the Seller . The Seller hereby represents and warrants to the Buyer, as of the date hereof and as of the date of each purchase of Receivables hereunder, that:
(a) Organization; Powers . The Seller is duly organized, validly existing and in good standing under the laws of the State of Delaware; has all requisite power and authority to own, operate, and encumber its property and assets to carry on its business as now conducted and proposed to be conducted in connection with and following the consummation of the transactions contemplated by the Transaction Documents; and, except where the failure to do so, individually or in the aggregate, has not resulted in and could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business, and is in good standing, in every jurisdiction where it owns or leases real property or where such qualification is required.
(b) Authorization; Enforceability . The Seller has the requisite corporate power and authority to execute, deliver, and perform its obligations under this Agreement and the other Transaction
 
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Documents executed by it or to be executed by it. The execution, delivery, and performance by the Seller of each Transaction Document and the consummation of the transactions contemplated thereby have been duly authorized by all necessary corporate actions and no other corporate proceedings on the part of the Seller are necessary to consummate such transactions. Each Transaction Document has been duly executed and delivered by the Seller and constitutes a legal, valid, and binding obligation of the Seller, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
(c) Governmental Approvals; No Conflicts . The execution, delivery, and performance by the Seller of each Transaction Document, and each of the transactions contemplated thereby, do not and will not (i) except for any filings to perfect the security interests granted pursuant to the Transaction Documents, require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, (ii) conflict with or violate the Seller’s certificate of incorporation or bylaws, (iii) conflict with, result in a breach of, or constitute (with or without notice or lapse of time or both) a default under any Requirement of Law or Contractual Obligation of the Seller, or require termination of any Contractual Obligation of the Seller, in each case, which could reasonably be expected to have a Material Adverse Effect, (iv) conflict with any Contractual Obligation of the Seller, any liability resulting from which has resulted in or could be reasonably expected to result in a Material Adverse Effect, (v) result in or require the creation or imposition of any Lien on any asset of the Seller, except Liens permitted by Section 7.02 of the Credit Agreement or (vi) require any approval of stockholders of the Seller, unless such approval has been obtained.
(d) Litigation Matters . There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Seller, threatened in writing against or affecting the Seller (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (other than the actions, suits, proceedings and environmental matters disclosed in Schedule 4.06 to the Credit Agreement) or (ii) that challenges the enforceability of any of the Transaction Documents. The Seller is not subject to or in default with respect to any final judgment, writ, injunction, decree, order, rule or regulation of any court or Governmental Authority which has had or could reasonably be expected to have a Material Adverse Effect.
(e) Compliance with Laws and Agreements; No Potential Amortization Event . Except where the failure to do so, individually or in the aggregate, has not resulted in and could not reasonably be expected to result in a Material Adverse Effect, the Seller is in compliance with (i) all Requirements of Law applicable to it or its business and (ii) all indentures, agreements, and other instruments binding upon it or its property. No Potential Amortization Event or Amortization Event has occurred and is continuing.
(f) Investment Company Status . The Seller is not an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940.
(g) Accuracy of Information . All information heretofore furnished by the Seller or any of its Affiliates to the Buyer or the Administrative Agent for purposes of or in connection with this Agreement, any of the other Transaction Documents or any transaction contemplated hereby or thereby is, and all such information hereafter furnished by the Seller or any of its Affiliates to the Buyer or the Administrative Agent will be, true and accurate in every material respect on the date such information is stated or certified and does not and will not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.
 
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(h) Performance . The Seller is not in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Contractual Obligation applicable to it the effect of which could reasonably be expected to result in a Material Adverse Effect, and no condition exists which, with the giving of notice or the lapse of time or both, would constitute a default under any such Contractual Obligation, except where the consequences, direct or indirect, of such default or defaults, if any, have not resulted in and could not reasonably be expected to result in a Material Adverse Effect.
(i) Solvency . The Seller is Solvent after giving effect to the transactions contemplated by this Agreement and the other Transaction Documents.
(j) Use of Proceeds . No proceeds of any purchase of a Receivable hereunder will be used, whether directly or indirectly, for any purpose that entails a violation of Regulation T, U or X.
(k) Good Title . Immediately prior to each purchase of a Receivable hereunder, the Seller shall be the legal and beneficial owner of such Receivable, and all Related Security with respect thereto, free and clear of any Lien, except as created or otherwise permitted by the Transaction Documents.
(l) Perfection . This Agreement, together with the filing of the financing statements contemplated hereby, is effective to transfer to the Buyer (and the Buyer shall acquire from the Seller) legal and equitable title to, with the right to sell and encumber, all Receivables existing on or arising after the date of this Agreement, in each case together with all Related Security and Collections with respect thereto, free and clear of any Lien, except as created by the Transactions Documents. All financing statements or other similar instruments or documents necessary under the UCC (or any comparable law) of all appropriate jurisdictions to perfect the Buyer’s ownership interest in the Receivables, and the Related Security and Collections with respect thereto, have been duly filed.
(m) Places of Business; Names . The principal places of business and chief executive office of the Seller and the offices where the Seller keeps all of its Records are located at the address(es) listed on Schedule E or such other locations of which the Buyer has been notified in accordance with Section 5.02(e) in jurisdictions where all action required by Section 5.02(e) has been taken and completed. The Seller’s state of incorporation and organization identification number (if any) are correctly set forth on Schedule E . In the past five (5) years, the Seller has not used any corporate name, trade name or assumed name other than the name in which it has executed this Agreement.
(n) Collections . The conditions and requirements set forth in Section 5.01(m) have at all times been satisfied and duly performed. The names and addresses of all Collection Banks, together with the account numbers of the Collection Accounts of the Seller at each Collection Bank and the post office box number of each Lock-Box, are listed on Schedule B .
(o) Material Adverse Effect . Since the Friday closest to December 31, 2014, no event has occurred that has resulted in, or could reasonably be expected to result in, a Material Adverse Effect.
(p) Ownership of Buyer . The Seller owns, directly or indirectly, 100% of the issued and outstanding capital stock of the Buyer, free and clear of any Lien. All such capital stock is validly issued, fully paid and nonassessable, and there are no options, warrants or other rights to acquire any securities of the Buyer.
(q) Compliance with Credit and Collection Policy . The Seller has complied in all material respects with the applicable Credit and Collection Policy with regard to each Receivable and the related Contract and has not made any material change to any Credit and Collection Policy except such material change as to which the Administrative Agent has been notified in accordance with Section 5.01(b)(vi) .
 
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(r) Payments to Seller . With respect to each Receivable transferred to the Buyer hereunder, the Purchase Price received by the Seller constitutes reasonably equivalent value in consideration therefor and such transfer was not made for or on account of an antecedent debt. No transfer by the Seller of any Receivable hereunder is or may be voidable under any section of the Bankruptcy Reform Act of 1978 (11 U.S.C. §§ 101 et seq. ), as amended.
(s) Enforceability of Contracts . Each Contract is effective to create, and has created, a legal, valid and binding obligation of the related Obligor to pay the Outstanding Balance of the related Receivable and any accrued interest thereon, enforceable against such Obligor in accordance with its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws relating to or limiting creditors’ rights generally and by general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).
(t) Eligible Receivables . Each Receivable included as an Eligible Receivable on the date of its purchase under the 2011 Receivables Sale Agreement or this Agreement was an Eligible Receivable on such purchase date, and, as of the date of each Borrowing Base Report, each Receivable included as an Eligible Receivable on such Borrowing Base Report was an Eligible Receivable.
ARTICLE IV
Conditions
SECTION 4.01. Conditions Precedent to Purchase . The effectiveness of this Agreement is subject to the condition precedent that (i) the Buyer shall have received those documents listed on Schedule A-1 and (ii) the Seller shall have received those documents listed on Schedule A-2 .
SECTION 4.02. Conditions Precedent to Subsequent Payments . The Buyer’s obligation to pay for Receivables originated or acquired by the Seller after the date of this Agreement shall be subject to the further conditions precedent that (a) the Facility Termination Date shall not have occurred and (b) the Buyer shall have received such approvals, opinions or other documents as it may reasonably request. The Seller represents and warrants that the representations and warranties set forth in Article III are true and correct on and as of the date each Receivable was originated or acquired by the Seller as though made on and as of such date.
ARTICLE V
Covenants
SECTION 5.01. Affirmative Covenants of the Seller . Until the date on which this Agreement terminates in accordance with its terms, the Seller hereby covenants and agrees that:
(a) Financial Statements; Other Information . The Seller will furnish (or will caused to be furnished) to the Buyer and the Administrative Agent:
(i) as and when required to be delivered under the Credit Agreement, the financial statements, reports, certificates, and other documents described in Section 6.01(a) through Section 6.01(e) and Section 6.01(l) of the Credit Agreement;
 
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(ii) as and when required to be delivered under the Credit Agreement, the reports described in Section 6.01(f) , Section 6.01(g) , Section 6.01(h) and Section 6.01(k) of the Credit Agreement with respect to the most recently concluded Fiscal Month (or, during an Enhanced Reporting Trigger Period, the prior week) (collectively, the “ Borrowing Base Reports ”); and
(iii) promptly following any request therefor, such other information regarding the operations, business affairs or financial condition of the Seller, the Receivables, or compliance with the terms of this Agreement, as the Buyer or the Administrative Agent may reasonably request.
(b) Notices of Material Events . The Seller will furnish (or will cause to be furnished) to the Buyer and the Administrative Agent prompt (but in any event within any time period that may be specified below) written notice of the following:
(i) the occurrence of any Potential Amortization Event or Amortization Event;
(ii) receipt of any notice described in Section 6.02(b) of the Credit Agreement;
(iii) any Lien or claim made or asserted against any of the Receivables;
(iv) any other development that results, or could reasonably be expected to result, in a Material Adverse Effect;
(v) any termination of the obligation of any Originator (other than the Seller) to sell Receivables to the Seller under the related Receivables Transfer Agreement and, upon any such termination, the Outstanding Balance of all Receivables originated by such other Originator as of the last day of the Fiscal Month then most recently ended;
(vi) at least thirty (30) days prior to the effectiveness of any material change in or material amendment to any Credit and Collection Policy, a notice (A) indicating such change or amendment, and (B) if such proposed change or amendment would reasonably be expected to adversely affect the collectability of the Receivables or decrease the credit quality of any newly created Receivables, requesting the consent of Buyer and the Administrative Agent to such proposed change or amendment; provided that if such change or amendment was required pursuant to any change in any applicable law, rule or regulation, the Seller shall only be required to give notice of such change or amendment and shall not be required to request the consent of the Buyer or the Administrative Agent; and
(vii) any notice, request for consent, financial statements, certification, report or other communication under or in connection with any Transaction Document from any Collection Bank, with copies of the same.
(c) Existence; Conduct of Business; Accounting . The Seller will and will cause each of its Subsidiaries to do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, qualifications, licenses, permits, franchises, governmental authorizations, intellectual property rights, licenses and permits material to the conduct of its business, and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted, except in those jurisdictions where the failure to do so could not reasonably be expected to result in a Material Adverse Effect and provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 7.03 of the Credit Agreement.
 
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(d) Books and Records; Inspection Rights and Audits . The Seller will and will cause each of its Subsidiaries to (i) keep proper books of record and account (including a system of accounting established and administered in accordance with sound business practices and consistent with past practice to permit preparation of financial statements in conformity with GAAP, and, if required by the terms of the Credit Agreement, in conformity with Agreement Accounting Principles, and each of the financial statements described in Section 5.01(a) shall be prepared from such system and records) in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities and (ii) permit any representatives designated by the Buyer or the Administrative Agent (including employees of the Buyer or the Administrative Agent or any consultants, accountants, lawyers, agents and appraisers retained by the Buyer or the Administrative Agent), upon reasonable prior notice, to visit and inspect its properties, to conduct at such Person’s premises field examinations of such Person’s assets, liabilities, books and records, including examining and making extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested. Only one (1) field examination per year will be conducted at the Seller’s sole cost and expense; provided that there shall be no limitation on the number or frequency of field examinations at the Seller’s sole cost and expense if an Amortization Event shall have occurred and be continuing.
(e) Compliance with Laws and Material Contractual Obligations . The Seller will and will cause each of its Subsidiaries to (i) comply with each Requirement of Law applicable to it or its property and (ii) perform in all material respects its obligations under material agreements to which it is a party, except, in each case, where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
(f) Insurance . The Seller will maintain in effect, or cause to be maintained in effect, at the Seller’s own expense, such casualty and liability insurance as the Seller deems appropriate in its good faith business judgment. The Seller will pay, or cause to be paid, the premiums therefor and will deliver to the Buyer and the Administrative Agent evidence satisfactory to the Buyer and the Administrative Agent of such insurance coverage. The Seller will furnish copies of each related insurance policy to the Buyer, the Administrative Agent or any Lender in certificated form upon the Buyer’s, the Administrative Agent’s or such Lender’s request. The foregoing requirements shall not be construed to negate, reduce or modify, and are in addition to, the Seller’s obligations hereunder.
(g) Taxes . The Seller will file all tax returns and reports required by law to be filed by it and promptly pay all taxes and governmental charges at any time owing, except any such taxes which are not yet delinquent or are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with GAAP shall have been set aside on its books, unless the failure to make any such payment (i) shall give rise to an immediate right to foreclosure on a Lien securing such amounts or (ii) could reasonably be expected to have a Material Adverse Effect.
(h) Keeping and Marking of Books and Records .
(i) The Seller will, or will cause each other Originator to, maintain and implement administrative and operating procedures (including an ability to recreate records evidencing Receivables in the event of the destruction of the originals thereof), and keep and maintain all documents, books, records and other information reasonably necessary or advisable for the collection of all Receivables (including records adequate to permit the identification of each new Receivable and all Collections of and adjustments to each existing Receivable within two (2) Business Days of the receipt of such Collection or adjustment in respect of such Receivable). The Seller will and will require each other Originator to give the Buyer and the Administrative Agent notice of any material change in the administrative and operating procedures referred to in the previous sentence.
 
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(ii) The Seller will and will cause each other Originator to (A) on or prior to the date hereof, cause all reports relating to the Receivables to bear a legend, acceptable to the Buyer and the Administrative Agent, describing the Buyer’s ownership interest in the Receivables and further describing the Lenders’ security interest in the Receivables under the Credit Agreement and (B) upon the request of the Buyer or the Administrative Agent following the occurrence and during the continuation of an Amortization Event, deliver to the Administrative Agent all invoices included in the Contracts (including all multiple originals of any such invoice) relating to the Receivables.
(i) Compliance with Contracts and Credit and Collection Policy . The Seller will and will cause each other Originator to timely and fully (i) perform and comply in all material respects with all provisions, covenants and other promises required to be observed by it under the Contracts related to the Receivables and (ii) comply in all material respects with the applicable Credit and Collection Policy in regard to each Receivable and the related Contract.
(j) Performance and Enforcement of Receivables Transfer Agreements . The Seller will perform each of its obligations and undertakings under and pursuant to each Receivables Transfer Agreement, will purchase Receivables thereunder in strict compliance with the terms thereof and will vigorously enforce its rights and remedies thereunder. The Seller will cause each other Originator to perform each of its obligations and undertakings under and pursuant to the related Receivables Transfer Agreement. The Seller will take all actions to perfect and enforce its rights and interests (and the rights and interests of the Buyer as assignee of the Seller) under each Receivables Transfer Agreement as the Buyer or the Administrative Agent may from time to time reasonably request, including making claims to which it may be entitled under any indemnity, reimbursement or similar provision contained in such Transfer Agreement. The Seller will not, and will not permit any other Originator to, amend or otherwise modify any Receivables Transfer Agreement without the prior written consent of the Administrative Agent.
(k) Ownership of Receivables . The Seller will and will cause each other Originator to take all necessary action to (i) establish and maintain, irrevocably in the Buyer, legal and equitable title to the Receivables, and all Related Security and Collections with respect thereto, in each case free and clear of any Lien other than Liens in favor of the Administrative Agent for the benefit of the Lenders and Liens otherwise permitted by Section 6.18 of the Credit Agreement (including the filing of all financing statements or other similar instruments or documents necessary under the UCC (or any comparable law) of all appropriate jurisdictions to perfect the Buyer’s interest in the Receivables, and all Related Security and Collections with respect thereto, and such other action to perfect, protect or more fully evidence the interest of the Buyer and the Administrative Agent and the Lenders as the Buyer or the Administrative Agent may reasonably request).
(l) Lenders’ Reliance . The Seller acknowledges that the Administrative Agent and the Lenders are entering into the transactions contemplated by the Credit Agreement in reliance upon the Buyer’s identity as a legal entity that is separate from the Seller and any Affiliates thereof. The Seller shall take all reasonable steps, including all steps that the Buyer or the Administrative Agent may from time to time reasonably request to maintain the Buyer’s identity as a separate legal entity and to make it manifest to third parties that the Buyer is an entity with assets and liabilities distinct from those of the Seller and any Affiliates of the Seller and not just a division of the Seller. Without limiting the generality of the foregoing and in addition to the other covenants set forth herein, the Seller (i) will not hold itself out to third parties as liable for the debts of the Buyer nor purport to own the Receivables and other assets
 
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acquired by the Buyer from the Seller, (ii) will take all other actions necessary on its part to ensure that the Buyer is at all times in compliance with the covenants set forth in Section 6.19 of the Credit Agreement and (iii) will cause all tax liabilities arising in connection with the transactions contemplated herein or otherwise to be allocated between the Seller and the Buyer on an arm’s-length basis and in a manner consistent with the procedures set forth in U.S. Treasury Regulations §§1.1502-33(d) and 1.1552-1.
(m) Collections . The Seller will cause (a) all Obligors to pay all Collections directly to a Lock-Box or Collection Account (or, to the extent permitted by the Security Agreement, a Company Owned Post Office Box), (b) all proceeds from all Lock-Boxes to be directly deposited by a Collection Bank into a Collection Account and (c) each Lock-Box and Collection Account to be subject at all times to a Collection Account Agreement that is in full force and effect; provided that, notwithstanding the foregoing, no Collection Account Agreement shall be required with respect to any Lock-Box or Collection Account listed on Schedule C until the date set forth for such Lock-Box or Collection Account on Schedule C . The Seller will cause (i) all proceeds from Company Owned Post Office Boxes to be directly deposited into a Collection Account in accordance with the Security Agreement and (ii) the Company Owned Post Office Boxes to be converted to Lock-Boxes to the extent required under the Security Agreement. In the event any payments relating to the Receivables are remitted directly to the Seller or any Affiliate of the Seller, the Seller will remit (or will cause all such payments to be remitted) directly to a Collection Bank and deposited into a Collection Account within two (2) Business Days following receipt thereof, and, at all times prior to such remittance, the Seller will hold (or will cause such payments to be held) in trust for the exclusive benefit of the Buyer and the Administrative Agent, subject to the Servicer’s rights under Section 8.02 of the Credit Agreement. The Servicer shall maintain exclusive ownership, dominion and control (subject to the terms of the Credit Agreement and the applicable Collection Account Agreement) of each Lock-Box and each Collection Account and shall ensure that no right to take dominion and control of any Lock-Box or any Collection Account is granted at a future time or upon the occurrence of a future event to any Person except to the Administrative Agent as contemplated by the Credit Agreement and the Transactions Documents. The Seller will cause each Lock-Box or Collection Account listed on Schedule C to be re-titled in the name of the Buyer on or before the date that is thirty (30) days after the date of this Agreement.
(n) Payment to the Originators . The Seller will purchase all Receivables to be purchased from any other Originator under, and in strict compliance with the terms of, the related Receivables Transfer Agreement, including the terms relating to the amount and timing of payments to be made to such Originator in respect of the purchase price for such Receivables.
SECTION 5.02. Negative Covenants of the Seller . Until the date on which this Agreement terminates in accordance with its terms, the Seller hereby covenants and agrees that:
(a) Sales, Liens . The Seller will not sell, assign (by operation of law or otherwise) or otherwise dispose of, or grant any option with respect to, or create or suffer to exist any Lien upon (including the filing of any financing statement) or with respect to, any Receivable, or any Related Security or Collections with respect thereto, or upon or with respect to any Contract under which any Receivable arises, or any Lock-Box or Collection Account, or assign any right to receive income with respect thereto (other than, in each case, the creation of the interests therein in favor of the Buyer as contemplated by this Agreement or as contemplated by Section 6.18 of the Credit Agreement). The Seller will not create or suffer to exist any mortgage, pledge, security interest, encumbrance, lien, charge or other similar arrangement on any of its inventory other than as permitted pursuant to the Inventory Facility Credit Agreement.
 
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(b) Change in Payment Instructions to Obligors . Except as may be required by the Administrative Agent pursuant to Section 8.02(b) of the Credit Agreement, the Seller will not add or terminate any bank as a Collection Bank, or make any change in the instructions to Obligors regarding payments to be made to any Lock-Box or Collection Account, unless the Buyer and the Administrative Agent shall have received, at least ten (10) days before the proposed effective date therefor, (i) written notice of such addition, termination or change and (ii) with respect to the addition of a Collection Bank or the addition of a Lock-Box or Collection Account, an executed Collection Account Agreement with respect to the new Lock-Box or Collection Account; provided that the Seller may make changes in instructions to Obligors regarding payments if such new instructions require such Obligor to make payments to another existing Collection Account.
(c) Modifications to Contracts and Credit and Collection Policy . The Seller will not, and will not permit any other Originator to, make any change to any Credit and Collection Policy that could reasonably be expected to adversely affect the collectability of the Receivables or decrease the credit quality of any newly created Receivables, unless required to do so by a change in any applicable law, rule or regulation. Except as otherwise permitted in its capacity as the Servicer pursuant to Section 8.02(d) of the Credit Agreement, the Seller will not, and will not permit any other Originator to, extend, amend or otherwise modify the terms of any Receivable or any related Contract other than in accordance with the applicable Credit and Collection Policy.
(d) Termination of Receivables Transfer Agreements . The Seller will not terminate any Receivables Transfer Agreement without the prior written consent of the Buyer and the Administrative Agent, except for a termination arising as a result of the Facility Termination Date.
(e) Name Change; Offices and Records . The Seller will not change its name, identity, state of incorporation, corporate structure or organization identification number, if any, or relocate its chief executive office or any office where Records are kept unless it shall have: (i) given the Buyer and the Administrative Agent at least forty-five (45) days’ prior written notice thereof and (ii) delivered to the Buyer and the Administrative Agent all financing statements, instruments and other documents requested by the Buyer or the Administrative Agent in connection with such change or relocation.
(f) Protection of Title . The Seller will defend the right, title and interest of the Buyer and the Administrative Agent in, to and under the Receivables, and the Related Security and Collections with respect thereto, each Contract under which any Receivable arises, each Lock-Box and each Collection Account against all claims of third parties claiming through or under the Seller or any other Originator.
(g) Accounting for Purchase . The Seller will not, and will not permit any Affiliate to, account for or treat (whether in financial statements or otherwise) the transactions contemplated hereby in any manner other than as a sale by the Seller to the Buyer of the Receivables and the Related Security with respect thereto, except to the extent that such transactions are not recognized on account of consolidated financial reporting in accordance with GAAP.
ARTICLE VI
Termination of Purchases; Amortization Event Remedies
SECTION 6.01. Voluntary Termination . The sale or contribution by the Seller to the Buyer of Receivables, and Related Security with respect thereto, pursuant to this Agreement may be terminated by any party hereto, upon reasonable notice to the other parties hereto, with the consent of the Administrative Agent or at any time after the date on which the Commitments are reduced to zero or otherwise terminated pursuant to the terms of the Credit Agreement and the Aggregate Credit Exposure
 
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has been reduced to zero. If the Buyer receives written notice from the Seller that the Seller wishes to terminate this Agreement, the Buyer shall promptly notify the Administrative Agent in writing that the Buyer wishes to terminate the Credit Agreement.
SECTION 6.02. Automatic Termination . The sale or contribution by the Seller to the Buyer of Receivables, and Related Security with respect thereto, pursuant to this Agreement shall automatically terminate on the Facility Termination Date.
SECTION 6.03. Amortization Event Remedies . Upon the occurrence and during the continuation of an Amortization Event, (i) the Administrative Agent or any Lender may, in accordance with the Credit Agreement, declare the Amortization Date to have occurred, whereupon the Amortization Date shall forthwith occur, without demand, protest or further notice of any kind, all of which are hereby expressly waived by the Seller; provided that upon the occurrence of an Amortization Event described in clause (h), (i) or (j) of Article IX of the Credit Agreement, the Amortization Date shall automatically occur, without demand, protest or any notice of any kind, all of which are hereby expressly waived by the Seller, and (ii) to the fullest extent permitted by applicable law, interest shall accrue with respect to any amounts then due and owing by the Seller to the Buyer at the then applicable Default Rate. The aforementioned rights and remedies shall be in addition to all other rights and remedies of the Buyer or the Administrative Agent available under this Agreement, the Credit Agreement, by operation of law, at equity or otherwise, all of which are hereby expressly preserved, including all rights and remedies provided under the UCC, all of which rights shall be cumulative.
ARTICLE VII
Indemnification
SECTION 7.01. Indemnities by Seller . Without limiting any other rights that the Buyer may have hereunder or under applicable law, the Seller hereby agrees to indemnify the Buyer and its assigns, officers, directors, agents and employees (each an “ Indemnified Party ”) against, and hold each Indemnified Party harmless from, any and all losses, claims, damages, penalties, incremental taxes, liabilities and related expenses, including the fees, charges and disbursements of any counsel for any Indemnified Party (collectively, “ Indemnified Amounts ”), incurred by or asserted against any Indemnified Party arising out of, in connection with, or as a result of this Agreement or the acquisition, either directly or indirectly, by the Buyer of an interest in the Receivables, excluding, however:
(i) Indemnified Amounts to the extent a final judgment of a court of competent jurisdiction holds that such Indemnified Amounts resulted from gross negligence or willful misconduct on the part of the Indemnified Party seeking indemnification;
(ii) Indemnified Amounts to the extent the same include losses in respect of Receivables that are uncollectible on account of the insolvency, bankruptcy or lack of creditworthiness of the related Obligor or the financial inability of the related Obligor to pay; or
(iii) taxes imposed by the jurisdiction in which such Indemnified Party’s principal executive office is located, on or measured by the overall net income of such Indemnified Party.
Without limiting the generality of the foregoing indemnification, the Seller shall indemnify each Indemnified Party against, and hold each Indemnified Party harmless from, any and all Indemnified Amounts incurred by or asserted against any Indemnified Party (including losses in respect of
 
23

uncollectible Receivables, but only to the extent such indemnification obligation arises pursuant to any of clauses (i) through (xv) below) arising out of, in connection with, or as a result of:
(i) any representation or warranty made by the Seller or any other Originator (or any officers of any such Person) under or in connection with this Agreement, any other Transaction Document or any other information or report delivered by any such Person pursuant hereto or thereto, which shall have been false or incorrect when made or deemed made;
(ii) any failure by the Seller or any other Originator to comply with any applicable law, rule or regulation with respect to any Receivable or any related Contract, or the nonconformity of any Receivable or any related Contract with any such applicable law, rule or regulation or any failure of the Seller or any other Originator to keep or perform any of its obligations, express or implied, with respect to any such Contract;
(iii) any failure by the Seller or any other Originator to perform its duties, covenants or other obligations in accordance with the provisions of this Agreement or any other Transaction Document;
(iv) any products liability, personal injury or damage suit or other similar claim arising out of or in connection with merchandise or services that are the subject of any Receivable or any related Contract;
(v) any dispute, claim, offset or defense of any related Obligor (other than discharge in bankruptcy of such Obligor) to the payment of any Receivable (including, without limitation, a defense based on such Receivable or the related Contract not being a legal, valid and binding obligation of such Obligor enforceable against such Obligor in accordance with its terms), or any other claim resulting from the merchandise or services that are the subject of such Receivable or the furnishing or failure to furnish such merchandise or services;
(vi) the commingling by the Seller of Collections with respect to any Receivable at any time with other funds;
(vii) any investigation, litigation or proceeding related to or arising from this Agreement or any other Transaction Document, the transactions contemplated hereby or thereby, the use of the proceeds of any purchase of Receivables hereunder, the ownership of the Receivables, or any other investigation, litigation or proceeding relating to the Seller or any other Originator or to the Buyer in which any Indemnified Party becomes involved as a result of any of the transactions contemplated hereby;
(viii) any inability to litigate any claim against any Obligor in respect of any Receivable as a result of such Obligor being immune from civil and commercial law and suit on the grounds of sovereignty or otherwise from any legal action, suit or proceeding;
(ix) the occurrence of any Amortization Event set forth in clause (h), (i) or (j) of Article IX of the Credit Agreement;
(x) any failure of the Seller to acquire and maintain legal and equitable title to, and ownership of, any Receivable, and the Related Security and Collections with respect thereto, from any other Originator, free and clear of any Lien (except as contemplated by this Agreement); or any failure of the Seller to give reasonably equivalent value to the related Originator under the related Receivables Transfer Agreement in consideration of the transfer by such Originator of any Receivable, or any attempt by any Person to void such transfer under statutory provisions or common law or equitable action;
 
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(xi) any failure to vest and maintain vested in the Buyer, or to transfer to the Buyer, legal and equitable title to, and ownership of, the Receivables, and the Related Security and Collections with respect thereto, free and clear of any Lien (except as contemplated by this Agreement);
(xii) any failure to have filed, or any delay in filing, financing statements or other similar instruments or documents under the UCC of any applicable jurisdiction or other applicable laws with respect to any Receivable, or the Related Security and Collections with respect thereto, and the proceeds of any thereof, whether at the time of the Purchase or at any subsequent time;
(xiii) any action or omission by the Seller which reduces or impairs the rights of the Buyer with respect to any Receivable or the value of any Receivable;
(xiv) any attempt by any Person to void any purchase of Receivables hereunder under statutory provisions or common law or equitable action; and
(xv) the failure of any Receivable included as an Eligible Receivable on any Borrowing Base Report to be an Eligible Receivable as of the date of such Borrowing Base Report.
SECTION 7.02. Other Costs and Expenses . The Seller shall pay to the Buyer on demand all costs and out-of-pocket expenses of the Buyer incurred in connection with the preparation, execution, delivery and administration of this Agreement, the transactions contemplated hereby and the other documents to be delivered hereunder. The Seller shall pay to the Buyer or the Administrative Agent, as applicable, on demand any and all costs and expenses of the Buyer or the Administrative Agent, including reasonable counsel fees and expenses, incurred in connection with the enforcement of this Agreement and the other documents delivered hereunder, any restructuring or workout of this Agreement or such documents, or the administration of this Agreement following an Amortization Event or a Recharacterization.
ARTICLE VIII
Miscellaneous
SECTION 8.01. Waivers and Amendments . No failure or delay on the part of the Buyer or the Administrative Agent in exercising any power, right or remedy under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or remedy preclude any other further exercise thereof or the exercise of any other power, right or remedy. The rights and remedies herein provided shall be cumulative and nonexclusive of any rights or remedies provided by law. Any waiver of this Agreement shall be effective only in the specific instance and for the specific purpose for which given. No provision of this Agreement may be amended, supplemented, modified or waived except in writing signed by the Seller and the Buyer and, to the extent required under the Credit Agreement, the Administrative Agent.
 
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SECTION 8.02. Notices . (a) All notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile or e-mail, as follows:
 
 	(i)	if to the Seller, at:	
Anixter Inc.
2301 Patriot Blvd
Glenview, Illinois 60026
Attention: David Johnson
Facsimile No: (224) 521-8990
E-Mail Address: david.johnson@anixter.com
 
 	(ii)	if to the Buyer, at:	
Anixter Receivables Corporation
c/o Anixter Inc.
2301 Patriot Blvd
Glenview, Illinois 60026
Attention: David Johnson
Facsimile No: (224) 521-8990
E-Mail Address: david.johnson@anixter.com
 
 	(iii)	if to the Administrative Agent, at:	
JPMorgan Chase Bank, N.A.
10 S. Dearborn Street, 22nd Floor
Mail Code: IL1-1454
Chicago, Illinois 60603
Attention: Stephanie Lis
Facsimile No: (312) 732-1262
E-Mail Address: stephanie.a.lis@chase.com
All such notices and other communications (i) sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received, (ii) sent by facsimile shall be deemed to have been given when sent; provided that if not given during normal business hours of the recipient, such notice or communication shall be deemed to have been given at the opening of business on the next Business Day of the recipient, or (c) sent by e-mail shall be deemed to have been given when received and shall be deemed to have been received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement): provided that if not given during the normal business hours of the recipient, such notice or communication shall be deemed to have been given at the opening of business on the next Business Day of the recipient.
(b) Any party hereto may change its address, facsimile number or e-mail address for notices and other communications hereunder by notice to the other parties hereto.
SECTION 8.03. Protection of Ownership Interest of Buyer .
(a) The Seller agrees that, from time to time at its expense, it will promptly execute and deliver all instruments and documents, and take all actions, that may be necessary or desirable, or that the Buyer or the Administrative Agent may request, to perfect, protect or more fully evidence the ownership interest of the Buyer and the security interest of the Lenders in the Receivables, and the Related Security and Collections with respect thereto, or to enable the Buyer or the Administrative Agent to exercise and enforce its rights and remedies hereunder. At any time, the Buyer (or following the occurrence of an
 
26

Amortization Event, the Administrative Agent) may, at the Seller’s sole cost and expense, direct the Seller to notify the Obligors in respect of the Receivables of the ownership interests of the Buyer under this Agreement and the other Transaction Documents and may also direct that payments of all amounts due or that become due under any or all Receivables be made directly to the Buyer or its designee or to the Administrative Agent.
(b) If the Seller fails to perform any of its obligations hereunder, the Buyer or the Administrative Agent may (but shall not be required to) perform, or cause performance of, such obligation, and the costs and expenses incurred by the Buyer or the Administrative Agent in connection therewith shall be payable by the Seller as provided in Section 7.02 . The Seller irrevocably authorizes the Buyer and the Administrative Agent at any time and from time to time in the sole discretion of the Buyer or the Administrative Agent and appoints each of the Buyer and the Administrative Agent as its attorney-in-fact, to act on behalf of the Seller (i) to execute on behalf of the Seller as debtor and to file financing statements necessary or desirable in the sole discretion of the Buyer or the Administrative Agent to perfect and to maintain the perfection and priority of the interest of the Buyer in the Receivables and (ii) to file a carbon, photographic or other reproduction of this Agreement or any financing statement with respect to the Receivables as a financing statement in such offices as the Buyer or the Administrative Agent in its sole discretion deems necessary or desirable to perfect and to maintain the perfection and priority of the Buyer’s interests in the Receivables. This appointment is coupled with an interest and is irrevocable.
SECTION 8.04. Confidentiality .
(a) The Seller shall maintain and shall cause each of its employees and officers to maintain the confidentiality of this Agreement and the other confidential proprietary information with respect to the Administrative Agent and the Lenders and their respective businesses obtained by it or them in connection with the structuring, negotiating and execution of the transactions contemplated herein, except that the Seller and its officers and employees may disclose such information to the Seller’s external accountants and attorneys and as required by any applicable law or order of any judicial or administrative proceeding.
(b) Anything herein to the contrary notwithstanding, the Seller hereby consents to the disclosure of any nonpublic information with respect to it (i) to the Buyer, the Administrative Agent or the Lenders by each other and (ii) by the Buyer, the Administrative Agent or the Lenders to any prospective or actual assignee or participant of any of them, provided that each such Person is informed of the confidential nature of such information. In addition, the Administrative Agent and the Lenders may disclose any such nonpublic information pursuant to any law, rule, regulation, direction, request or order of any judicial, administrative or regulatory authority or proceedings (whether or not having the force or effect of law), provided that the Administrative Agent or the Lenders, as applicable, shall, if practicable, notify the Seller in advance prior to disclosure and will use reasonable efforts to cooperate with the Seller at the Seller’s expense in obtaining any protective order for such information.
SECTION 8.05. No Bankruptcy Petition . The Seller agrees, for the benefit of the parties to the Credit Agreement, that it will not institute against the Buyer, or join any other Person in instituting against the Buyer, any proceeding of a type referred to in the definition of Bankruptcy Event from the date hereof until one year plus one day after the date on which the Commitments are reduced to zero or otherwise terminated pursuant to the terms of the Credit Agreement and the Aggregate Credit Exposure has been reduced to zero. In addition, all amounts payable by the Buyer to the Seller pursuant to this Agreement shall be payable solely from funds available for that purpose (after the Buyer has satisfied all obligations then due and owing under the Credit Agreement).
 
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SECTION 8.06. Limitation of Liability . Except with respect to any claim arising out of the willful misconduct or gross negligence of the Administrative Agent or any Lender, no claim may be made by the Seller or any other Person against the Administrative Agent or any Lender or their respective Affiliates, directors, officers, employees, attorneys or agents for any special, indirect, consequential or punitive damages in respect of any claim for breach of contract or any other theory of liability arising out of or related to the transactions contemplated by this Agreement, or any act, omission or event occurring in connection therewith; and the Seller hereby waives, releases, and agrees not to sue upon any claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favor.
SECTION 8.07. Governing Law; Jurisdiction; Consent to Service of Process .
(a) This Agreement shall be governed by and construed in accordance with the internal laws (and not the law of conflicts) of the State of Illinois (including 735 ILCS Section 105/5-1 et seq).
(b) The Seller hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any U.S. federal or Illinois state court sitting in Cook County, Illinois in any action or proceeding arising out of or relating to this Agreement or any of the other Transaction Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such Illinois state court or, to the extent permitted by law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other Transaction Document shall affect any right that the Buyer may otherwise have to bring any action or proceeding relating to this Agreement or any other Transaction Document against the Seller or any of its properties in the courts of any jurisdiction.
(c) The Seller hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Transaction Document in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 8.02 . Nothing in this Agreement or any other Transaction Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 8.08. WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, OTHER AGENT (INCLUDING ANY ATTORNEY) OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
 
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SECTION 8.09. Integration; Binding Effect; Survival of Terms .
(a) This Agreement, the Subordinated Note, the Subscription Agreement, the Subordination Agreement, the Subordinated Security Agreement, and each Collection Account Agreement contain the final and complete integration of all prior expressions by the parties hereto with respect to the subject matter hereof and shall constitute the entire agreement among the parties hereto with respect to the subject matter hereof superseding all prior oral or written understandings.
(b) This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns (including any trustee in bankruptcy). This Agreement shall create and constitute the continuing obligations of the parties hereto in accordance with its terms and shall remain in full force and effect until terminated in accordance with its terms; provided that the rights and remedies with respect to (i) any breach of any representation and warranty made by the Seller pursuant to Article III , (ii) the indemnification and payment provisions of Article VII , and (iii)  Section 8.05 shall be continuing and shall survive any termination of this Agreement.
SECTION 8.10. Counterparts; Severability . This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same Agreement. Any provision of this Agreement or any other Transaction Document held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions thereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
(Signature Pages Follow)
 
29

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective authorized officers as of the day and year first above written.

ANIXTER INC.,
 as Seller	
		
By:	 	/s/ Rodney Shoemaker	
Name:	 	Rodney Shoemaker	
Title:	 	Senior Vice President – Treasurer	
	
ANIXTER RECEIVABLES CORPORATION,
as Buyer	
		
By:	 	/s/ Rodney Shoemaker	
Name:	 	Rodney Shoemaker	
Title:	 	Vice President – Treasurer	
 
Signature page to Anixter Receivables Sale Agreement

Exhibit 10.3

 

CREDIT AGREEMENT
(Inventory Facility)
by and among
WELLS FARGO BANK, NATIONAL ASSOCIATION ,
as Administrative Agent,
WELLS FARGO BANK, NATIONAL ASSOCIATION , and
J.P. MORGAN SECURITIES LLC ,
as Joint Lead Arrangers and Joint Book Runners,
WELLS FARGO BANK, NATIONAL ASSOCIATION , and
JPMORGAN CHASE BANK, N.A. ,
as Co-Syndication Agents,
BANK OF AMERICA, N.A. , and SUNTRUST BANK ,
as Co-Documentation Agents,
THE LENDERS THAT ARE PARTIES HERETO ,
as the Lenders,
ANIXTER INC. and
EACH OF THE SUBSIDIARIES OF ANIXTER INC.
FROM TIME TO TIME PARTY HERETO AS A “BORROWER , ”
as Borrowers
Dated as of October 5, 2015

 

TABLE OF CONTENTS

 	 	 	  	 	  	Page	 	
1.	 	DEFINITIONS AND CONSTRUCTION	  	 	1	  	
				
	 	1.1	  	Definitions	  	 	1	  	
	 	1.2	  	Accounting Terms	  	 	1	  	
	 	1.3	  	Code	  	 	2	  	
	 	1.4	  	Construction	  	 	2	  	
	 	1.5	  	Time References	  	 	3	  	
	 	1.6	  	Schedules and Exhibits	  	 	3	  	
			
2.	 	LOANS AND TERMS OF PAYMENT	  	 	3	  	
				
	 	2.1	  	Revolving Loans	  	 	3	  	
	 	2.2	  	[Reserved]	  	 	4	  	
	 	2.3	  	Borrowing Procedures and Settlements	  	 	4	  	
	 	2.4	  	Payments; Reductions of Commitments; Prepayments	  	 	11	  	
	 	2.5	  	Promise to Pay; Promissory Notes	  	 	15	  	
	 	2.6	  	Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations	  	 	16	  	
	 	2.7	  	Crediting Payments	  	 	17	  	
	 	2.8	  	Designated Account	  	 	17	  	
	 	2.9	  	Maintenance of Loan Account; Statements of Obligations	  	 	18	  	
	 	2.10	  	Fees	  	 	18	  	
	 	2.11	  	Letters of Credit	  	 	19	  	
	 	2.12	  	LIBOR Option	  	 	26	  	
	 	2.13	  	Capital Requirements	  	 	29	  	
	 	2.14	  	[Reserved]	  	 	30	  	
	 	2.15	  	Joint and Several Liability of Borrowers	  	 	30	  	
			
3.	 	CONDITIONS; TERM OF AGREEMENT	  	 	32	  	
				
	 	3.1	  	Conditions Precedent to Closing Date	  	 	32	  	
	 	3.2	  	Conditions Precedent to all Extensions of Credit	  	 	36	  	
	 	3.3	  	Maturity	  	 	37	  	
	 	3.4	  	Effect of Maturity	  	 	37	  	
	 	3.5	  	Early Termination by Borrowers	  	 	37	  	
			
4.	 	REPRESENTATIONS AND WARRANTIES	  	 	38	  	
				
	 	4.1	  	Organization; Powers	  	 	38	  	
	 	4.2	  	Authorization; Enforceability	  	 	38	  	
	 	4.3	  	Governmental Approvals; No Conflicts	  	 	39	  	
	 	4.4	  	Financial Condition; No Material Adverse Change	  	 	39	  	
	 	4.5	  	Properties	  	 	39	  	
	 	4.6	  	Litigation and Environmental Matters	  	 	40	  	
	 	4.7	  	Compliance with Laws and Agreements; No Default	  	 	40	  	
	 	4.8	  	Investment Company Status	  	 	41	  	
	 	4.9	  	Taxes	  	 	41	  	
	 	4.10	  	ERISA	  	 	41	  	
	 	4.11	  	Disclosure	  	 	41	  	
	 	4.12	  	Performance	  	 	41	  	
	 	4.13	  	Solvency	  	 	41	  	
	 	4.14	  	Insurance	  	 	42	  	
	 	4.15	  	Capitalization and Subsidiaries; Joint Venture; Partnership	  	 	42	  	
	 	4.16	  	Security Interest in Collateral	  	 	42	  	
 
i

TABLE OF CONTENTS
(continued)

 	 	 	  	 	  	Page	 	
	 	4.17	  	[Reserved]	  	 	42	  	
	 	4.18	  	Federal Reserve Regulations	  	 	42	  	
	 	4.19	  	Use of Proceeds	  	 	42	  	
	 	4.20	  	[Reserved]	  	 	42	  	
	 	4.21	  	Restricted Payments to AXE	  	 	43	  	
	 	4.22	  	Anti-Corruption Laws and Sanctions	  	 	43	  	
	 	4.23	  	HD Supply Acquisition	  	 	43	  	
	 	4.24	  	Indebtedness	  	 	43	  	
	 	4.25	  	Eligible Inventory	  	 	43	  	
	 	4.26	  	Location of Inventory	  	 	44	  	
	 	4.27	  	Inventory Records	  	 	44	  	
	 	4.28	  	Swap Agreements	  	 	44	  	
			
5.	 	AFFIRMATIVE COVENANTS	  	 	44	  	
				
	 	5.1	  	Financial Statements; Borrowing Base; Other Information	  	 	44	  	
	 	5.2	  	Notices of Material Events	  	 	47	  	
	 	5.3	  	Existence; Conduct of Business	  	 	48	  	
	 	5.4	  	Payment of Obligations	  	 	48	  	
	 	5.5	  	Maintenance of Properties	  	 	49	  	
	 	5.6	  	Books and Records; Inspection Rights	  	 	49	  	
	 	5.7	  	Compliance with Laws and Material Contractual Obligations	  	 	49	  	
	 	5.8	  	Use of Proceeds	  	 	49	  	
	 	5.9	  	[Reserved]	  	 	50	  	
	 	5.10	  	Insurance	  	 	50	  	
	 	5.11	  	Casualty and Condemnation	  	 	50	  	
	 	5.12	  	Depository Banks	  	 	51	  	
	 	5.13	  	Employee Benefit Matters	  	 	51	  	
	 	5.14	  	Formation of Subsidiaries; Further Assurances	  	 	51	  	
	 	5.15	  	Location of Inventory	  	 	52	  	
	 	5.16	  	Post-Closing Security Perfection	  	 	52	  	
			
6.	 	NEGATIVE COVENANTS	  	 	52	  	
				
	 	6.1	  	Indebtedness	  	 	52	  	
	 	6.2	  	Liens	  	 	54	  	
	 	6.3	  	Fundamental Changes	  	 	56	  	
	 	6.4	  	Investments, Loans, Advances, Guarantees, and Acquisitions	  	 	56	  	
	 	6.5	  	Asset Sales	  	 	58	  	
	 	6.6	  	Sale and Leaseback Transactions	  	 	59	  	
	 	6.7	  	Swap Agreements	  	 	59	  	
	 	6.8	  	Payments to AXE; Certain Payments of Indebtedness	  	 	60	  	
	 	6.9	  	Transactions with Affiliates	  	 	61	  	
	 	6.10	  	Restrictive Agreements	  	 	61	  	
	 	6.11	  	Amendment of Material Documents	  	 	61	  	
	 	6.12	  	Employee Benefit Matters	  	 	62	  	
	 	6.13	  	Environmental Liabilities	  	 	62	  	
	 	6.14	  	Minimum Fixed Charge Coverage Ratio	  	 	62	  	
	 	6.15	  	Inventory with Bailees	  	 	63	  	
			
7.	 	[RESERVED]	  	 	63	  	
			
8.	 	EVENTS OF DEFAULT	  	 	63	  	
 
ii

TABLE OF CONTENTS
(continued)

 	 	 	  	 	  	Page	 	
9.	 	RIGHTS AND REMEDIES	  	 	66	  	
				
	 	9.1	  	Rights and Remedies	  	 	66	  	
	 	9.2	  	Remedies Cumulative	  	 	67	  	
			
10.	 	WAIVERS; INDEMNIFICATION	  	 	67	  	
				
	 	10.1	  	Demand; Protest; etc	  	 	67	  	
	 	10.2	  	The Lender Group’s Liability for Collateral	  	 	67	  	
	 	10.3	  	Indemnification	  	 	67	  	
			
11.	 	NOTICES	  	 	68	  	
			
12.	 	CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER; JUDICIAL REFERENCE PROVISION	  	 	69	  	
			
13.	 	ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS	  	 	73	  	
				
	 	13.1	  	Assignments and Participations	  	 	73	  	
	 	13.2	  	Successors	  	 	76	  	
			
14.	 	AMENDMENTS; WAIVERS	  	 	77	  	
				
	 	14.1	  	Amendments and Waivers	  	 	77	  	
	 	14.2	  	Replacement of Certain Lenders	  	 	79	  	
	 	14.3	  	No Waivers; Cumulative Remedies	  	 	79	  	
			
15.	 	AGENT; THE LENDER GROUP	  	 	80	  	
				
	 	15.1	  	Appointment and Authorization of Administrative Agent	  	 	80	  	
	 	15.2	  	Delegation of Duties	  	 	81	  	
	 	15.3	  	Liability of Administrative Agent	  	 	81	  	
	 	15.4	  	Reliance by Administrative Agent	  	 	81	  	
	 	15.5	  	Notice of Default or Event of Default	  	 	81	  	
	 	15.6	  	Credit Decision	  	 	82	  	
	 	15.7	  	Costs and Expenses; Indemnification	  	 	83	  	
	 	15.8	  	Administrative Agent in Individual Capacity	  	 	83	  	
	 	15.9	  	Successor Administrative Agent	  	 	84	  	
	 	15.10	  	Lender in Individual Capacity	  	 	84	  	
	 	15.11	  	Collateral Matters	  	 	85	  	
	 	15.12	  	Right of Setoff; Restrictions on Actions by Lenders; Sharing of Payments	  	 	87	  	
	 	15.13	  	Agency for Perfection	  	 	87	  	
	 	15.14	  	Payments by Administrative Agent to the Lenders	  	 	88	  	
	 	15.15	  	Concerning the Collateral and Related Loan Documents	  	 	88	  	
	 	15.16	  	Field Examination Reports; Confidentiality; Disclaimers by Lenders; Other Reports and Information	  	 	88	  	
	 	15.17	  	Several Obligations; No Liability	  	 	89	  	
	 	15.18	  	Joint Lead Arrangers, Joint Book Runners, Co-Syndication Agents, and Co-Documentation Agents	  	 	89	  	
			
16.	 	WITHHOLDING TAXES	  	 	90	  	
				
	 	16.1	  	Payments	  	 	90	  	
	 	16.2	  	Exemptions	  	 	90	  	
	 	16.3	  	Reductions	  	 	91	  	
	 	16.4	  	Refunds	  	 	92	  	
 
iii

TABLE OF CONTENTS
(continued)

 	 	 	  	 	  	Page	 	
17.	 	GENERAL PROVISIONS	  	 	92	  	
				
	 	17.1	  	Effectiveness	  	 	92	  	
	 	17.2	  	Section Headings	  	 	93	  	
	 	17.3	  	Interpretation	  	 	93	  	
	 	17.4	  	Severability of Provisions	  	 	93	  	
	 	17.5	  	Bank Product Providers	  	 	93	  	
	 	17.6	  	Debtor-Creditor Relationship	  	 	94	  	
	 	17.7	  	Counterparts; Electronic Execution	  	 	94	  	
	 	17.8	  	Revival and Reinstatement of Obligations; Certain Waivers	  	 	94	  	
	 	17.9	  	Confidentiality	  	 	95	  	
	 	17.10	  	Survival	  	 	96	  	
	 	17.11	  	Patriot Act	  	 	96	  	
	 	17.12	  	Integration	  	 	97	  	
	 	17.13	  	Borrower Representative	  	 	98	  	
 
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EXHIBITS AND SCHEDULES

Exhibit A-1	  	Form of Assignment and Acceptance	
Exhibit B-1	  	Form of Borrowing Base Certificate	
Exhibit B-2	  	Form of Bank Product Provider Agreement	
Exhibit D-1	  	Form of Compliance Certificate	
Exhibit I-1	  	Form of Intercreditor Agreement	
Exhibit L-1	  	Form of LIBOR Notice	
Exhibit P-1	  	Form of Perfection Certificate	
		
Schedule A-1	  	Administrative Agent’s Account	
Schedule A-2	  	Authorized Persons	
Schedule C-1	  	Commitments	
Schedule D-1	  	Designated Account	
Schedule E-2	  	Existing Letters of Credit	
Schedule 1.1	  	Definitions	
Schedule 4.3	  	Governmental Approvals; No Conflicts	
Schedule 4.5	  	Properties	
Schedule 4.6	  	Disclosed Matters	
Schedule 4.14	  	Insurance	
Schedule 4.15	  	Capitalization and Subsidiaries; Joint Venture; Partnership	
Schedule 5.15	  	Location of Inventory	
Schedule 5.16	  	Post-Closing Security Perfection	
Schedule 6.1	  	Existing Indebtedness	
Schedule 6.2	  	Existing Liens	
Schedule 6.4	  	Existing Investments	
Schedule 6.10	  	Restrictive Agreements	
 
v

CREDIT AGREEMENT
(Inventory Facility)
THIS CREDIT AGREEMENT (this “ Agreement ”), is entered into as of October 5, 2015, by and among the lenders identified on the signature pages hereof (each of such lenders, together with its successors and permitted assigns, is referred to hereinafter as a “ Lender ”, as that term is hereinafter further defined), WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as administrative agent for each member of the Lender Group and the Bank Product Providers (in such capacity, together with its successors and assigns in such capacity, “ Administrative Agent ”), WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, and J.P. MORGAN SECURITIES LLC, as joint lead arrangers (in such capacity, together with their successors and assigns in such capacity, the “ Joint Lead Arrangers ”) and as joint book runners (in such capacity, together with their successors and assigns in such capacity, the “ Joint Book Runners ”), WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, and JPMORGAN CHASE BANK, N.A., a national banking association, as co-syndication agents (in such capacity, together with their successors and assigns in such capacity, the “ Co-Syndication Agents ”), BANK OF AMERICA, N.A., a national banking association, and SUNTRUST BANK, a Georgia banking corporation, as co-documentation agents (in such capacity, together with their successors and assigns in such capacity, the “ Co-Documentation Agents ”), ANIXTER INC., a Delaware corporation (“ Anixter ”), and each of the Subsidiaries of Anixter identified on the signature pages hereof or otherwise party hereto as a “Borrower,” including, without limitation, each Target that becomes a Domestic Subsidiary effective upon consummation of the HD Supply Acquisition (such Subsidiaries, together with Anixter, are referred to hereinafter each individually as a “ Borrower ” and individually and collectively, jointly and severally, as the “ Borrowers ”).
The parties agree as follows:
1. DEFINITIONS AND CONSTRUCTION .
1.1 Definitions . Capitalized terms used in this Agreement shall have the meanings specified therefor on Schedule 1.1 .
1.2 Accounting Terms . Except as otherwise expressly provided in this Agreement, all accounting terms not specifically defined herein shall be construed in accordance with GAAP. When used herein, the term “financial statements” shall include the notes and schedules thereto. Notwithstanding anything to the contrary contained herein, the term “unqualified opinion” as used herein to refer to opinions or reports provided by accountants shall mean an opinion or report that is (i) unqualified, and (ii) does not include any explanation, supplemental comment, or other comment concerning the ability of the applicable Person to continue as a going concern or concerning the scope of the audit. Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, (i) without giving effect to any election under Financial Accounting Standards Board Accounting Standards Codification 825-10-25 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of the Borrowers at “fair value,” as defined therein and (ii) without giving effect to any treatment of Indebtedness in respect of convertible debt instruments under Financial Accounting Standards Board Accounting Standards Codification 470-20 (or any other Accounting Standards Codification or Financial
 
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Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof, and (iii) obligations relating to a lease that was accounted for by such Person as an operating lease as of the Closing Date shall be accounted for as obligations relating to an operating lease and not as obligations relating to a capital lease.
1.3 Code . Any terms used in this Agreement that are defined in the Code shall be construed and defined as set forth in the Code unless otherwise defined herein; provided , that to the extent that the Code is used to define any term herein and such term is defined differently in different Articles of the Code, the definition of such term contained in Article 9 of the Code shall govern.
1.4 Construction . Unless the context of this Agreement or any other Loan Document clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document, as the case may be, as a whole and not to any particular provision of this Agreement or such other Loan Document, as the case may be. Section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement or in any other Loan Document to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). The words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties. Any reference herein or in any other Loan Document to the satisfaction, repayment, or payment in full of the Obligations shall mean (a) the payment or repayment in full in immediately available funds of (i) the principal amount of, and interest accrued and unpaid with respect to, all outstanding Loans, together with the payment of any premium applicable to the repayment of the Loans, (ii) all Lender Group Expenses that have accrued and are unpaid regardless of whether demand has been made therefor, (iii) all fees or charges that have accrued hereunder or under any other Loan Document (including the Letter of Credit Fee and the Unused Line Fee) and are unpaid, (b) in the case of contingent reimbursement obligations with respect to Letters of Credit, providing Letter of Credit Collateralization, (c) in the case of obligations with respect to Bank Products (other than Swap Obligations), providing Bank Product Collateralization, (d) the receipt by Administrative Agent of cash collateral in order to secure any other contingent Obligations for which a claim or demand for payment has been made on or prior to such time or in respect of matters or circumstances known to Administrative Agent or a Lender at such time that are reasonably expected to result in any loss, cost, damage, or expense (including attorneys’ fees and legal expenses), such cash collateral to be in such amount as Administrative Agent reasonably determines is appropriate to secure such contingent Obligations, (e) the payment or repayment in full in immediately available funds of all other outstanding Obligations (including the payment of any termination amount then applicable (or which would or could become applicable as a result of the repayment of the other Obligations) under Swap Agreements provided by Swap Providers) other than (i) unasserted contingent indemnification Obligations, (ii) any Bank Product Obligations (other than Swap Obligations) that, at such time, are allowed by the applicable Bank Product Provider to remain outstanding without being required to be repaid or cash collateralized, and (iii) any Swap Obligations that, at such time, are allowed by the
 
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applicable Swap Provider to remain outstanding without being required to be repaid, and (f) the termination of all of the Commitments of the Lenders. Any reference herein to any Person shall be construed to include such Person’s successors and assigns. Any requirement of a writing contained herein or in any other Loan Document shall be satisfied by the transmission of a Record.
1.5 Time References . Unless the context of this Agreement or any other Loan Document clearly requires otherwise, all references to time of day refer to Central standard time or Central daylight saving time, as in effect in Chicago, Illinois, on such day. For purposes of the computation of a period of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each means “to and including”; provided that, with respect to a computation of fees or interest payable to Administrative Agent or any Lender, such period shall in any event consist of at least one full day.
1.6 Schedules and Exhibits . All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference.
2. LOANS AND TERMS OF PAYMENT .
2.1 Revolving Loans .
(a) Subject to the terms and conditions of this Agreement, and during the term of this Agreement, each Revolving Lender agrees (severally, not jointly or jointly and severally) to make revolving loans (“ Revolving Loans ”) to Borrowers in an amount at any one time outstanding not to exceed the lesser of:
(i) such Lender’s Revolver Commitment, or
(ii) such Lender’s Pro Rata Share of an amount equal to (A)  the least of (1) the Maximum Revolver Amount, (2) the Borrowing Base as of such date (based upon the most recent Borrowing Base Certificate delivered by Borrowers to Administrative Agent), and (3) the Secured Debt Indenture Cap Amount as of such date (based upon the most recent Borrowing Base Certificate delivered by Borrowers to Administrative Agent), less (B) the sum of (1) the Letter of Credit Usage at such time, plus (2) the principal amount of Swing Loans outstanding at such time.
(b) Amounts borrowed pursuant to this Section 2.1 may be repaid and, subject to the terms and conditions of this Agreement, reborrowed at any time during the term of this Agreement. The outstanding principal amount of the Revolving Loans, together with interest accrued and unpaid thereon, shall constitute Obligations and shall be due and payable on the Maturity Date or, if earlier, on the date on which they are declared due and payable pursuant to the terms of this Agreement.
(c) Anything to the contrary in this Section 2.1 notwithstanding, Administrative Agent shall have the right (but not the obligation), in the exercise of its Permitted Discretion, to establish and increase or decrease (i) Bank Product Reserves and other Reserves against the Borrowing Base or the Maximum Revolver Amount, (ii) Inventory Reserves against the Borrowing Base, and (iii) if the Borrowing Base does not exceed the Maximum Revolver Amount, Inventory Reserves against the Maximum Revolver Amount. The amount of any Inventory Reserve, Bank Product Reserve, or other Reserve established by Administrative Agent shall have a reasonable relationship to the event, condition, other circumstance, or fact that is the basis for such reserve and shall not be duplicative of any other reserve established and currently maintained.
 
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2.2 [Reserved].
2.3 Borrowing Procedures and Settlements .
(a) Procedure for Borrowing Revolving Loans . Each Borrowing shall be made by a written request by an Authorized Person delivered to Administrative Agent and received by Administrative Agent no later than noon (i) on the Business Day that is the requested Funding Date in the case of a request for a Swing Loan, and (ii) on the Business Day that is 1 Business Day prior to the requested Funding Date in the case of all other requests, specifying (A) the amount of such Borrowing, and (B) the requested Funding Date (which shall be a Business Day); provided , that Administrative Agent may, in its sole discretion, elect to accept as timely requests that are received later than noon on the applicable Business Day. At Administrative Agent’s election, in lieu of delivering the above-described written request, any Authorized Person may give Administrative Agent telephonic notice of such request by the required time. In such circumstances, Borrowers agree that any such telephonic notice will be confirmed in writing within 24 hours of the giving of such telephonic notice, but the failure to provide such written confirmation shall not affect the validity of the request.
(b) Making of Swing Loans . In the case of a request for a Revolving Loan and so long as either (i) the aggregate amount of Swing Loans made since the last Settlement Date, minus all payments or other amounts applied to Swing Loans since the last Settlement Date, plus the amount of the requested Swing Loan does not exceed an amount equal to $15,000,000, or (ii) Swing Lender, in its sole discretion, agrees to make a Swing Loan notwithstanding the foregoing limitation, Swing Lender shall make a Revolving Loan (any such Revolving Loan made by Swing Lender pursuant to this Section 2.3(b) being referred to as a “ Swing Loan ” and all such Revolving Loans being referred to as “ Swing Loans ”) available to Borrowers on the Funding Date applicable thereto by transferring immediately available funds in the amount of such requested Borrowing to the Designated Account. Each Swing Loan shall be deemed to be a Revolving Loan hereunder and shall be subject to all the terms and conditions (including Section 3 ) applicable to other Revolving Loans, except that all payments (including interest) on any Swing Loan shall be payable to Swing Lender solely for its own account. Subject to the provisions of Section 2.3(d)(ii) , Swing Lender shall not make and shall not be obligated to make any Swing Loan if Swing Lender has actual knowledge that (i) one or more of the applicable conditions precedent set forth in Section 3 will not be satisfied on the requested Funding Date for the applicable Borrowing, or (ii) the requested Borrowing would exceed the Availability on such Funding Date. Swing Lender shall not otherwise be required to determine whether the applicable conditions precedent set forth in Section 3 have been satisfied on the Funding Date applicable thereto prior to making any Swing Loan. The Swing Loans shall be secured by Administrative Agent’s Liens, constitute Revolving Loans and Obligations, and bear interest at the rate applicable from time to time to Revolving Loans that are Base Rate Loans.
(c) Making of Revolving Loans .
(i) In the event that Swing Lender is not obligated to make a Swing Loan, then after receipt of a request for a Borrowing pursuant to Section 2.3(a) , Administrative Agent shall notify the Lenders by telecopy, telephone, email, or other electronic form of transmission, of the requested Borrowing; such notification to be sent on the Business Day that is 1 Business Day prior to the
 
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requested Funding Date. If Administrative Agent has notified the Lenders of a requested Borrowing on the Business Day that is 1 Business Day prior to the Funding Date, then each Lender shall make the amount of such Lender’s Pro Rata Share of the requested Borrowing available to Administrative Agent in immediately available funds, to Administrative Agent’s Account, not later than noon on the Business Day that is the requested Funding Date. After Administrative Agent’s receipt of the proceeds of such Revolving Loans from the Lenders, Administrative Agent shall make the proceeds thereof available to Borrowers on the applicable Funding Date by transferring immediately available funds equal to such proceeds received by Administrative Agent to the Designated Account; provided , that, subject to the provisions of Section 2.3(d)(ii) , no Lender shall have an obligation to make any Revolving Loan if (1) one or more of the applicable conditions precedent set forth in Section 3 will not be satisfied on the requested Funding Date for the applicable Borrowing unless such condition has been waived, or (2) the requested Borrowing would exceed the Availability on such Funding Date.
(ii) Unless Administrative Agent receives notice from a Lender prior to 11:30 a.m. on the Business Day that is the requested Funding Date relative to a requested Borrowing as to which Administrative Agent has notified the Lenders of a requested Borrowing that such Lender will not make available as and when required hereunder to Administrative Agent for the account of Borrowers the amount of that Lender’s Pro Rata Share of the Borrowing, Administrative Agent may assume that each Lender has made or will make such amount available to Administrative Agent in immediately available funds on the Funding Date and Administrative Agent may (but shall not be so required), in reliance upon such assumption, make available to Borrowers a corresponding amount. If, on the requested Funding Date, any Lender shall not have remitted the full amount that it is required to make available to Administrative Agent in immediately available funds and if Administrative Agent has made available to Borrowers such amount on the requested Funding Date, then such Lender shall make the amount of such Lender’s Pro Rata Share of the requested Borrowing available to Administrative Agent in immediately available funds, to Administrative Agent’s Account, no later than noon on the Business Day that is the first Business Day after the requested Funding Date (in which case, the interest accrued on such Lender’s portion of such Borrowing for the Funding Date shall be for Administrative Agent’s separate account). If any Lender shall not remit the full amount that it is required to make available to Administrative Agent in immediately available funds as and when required hereby and if Administrative Agent has made available to Borrowers such amount, then that Lender shall be obligated to immediately remit such amount to Administrative Agent, together with interest at the Defaulting Lender Rate for each day until the date on which such amount is so remitted. A notice submitted by Administrative Agent to any Lender with respect to amounts owing under this Section 2.3(c)(ii) shall be conclusive, absent manifest error. If the amount that a Lender is required to remit is made available to Administrative Agent, then such payment to Administrative Agent shall constitute such Lender’s Revolving Loan for all purposes of this Agreement. If such amount is not made available to Administrative Agent on the Business Day following the Funding Date, Administrative Agent will notify Borrowers of such failure to fund and, upon demand by Administrative Agent, Borrowers shall pay such amount to Administrative Agent for Administrative Agent’s account, together with interest thereon for each day elapsed since the date of such Borrowing, at a rate per annum equal to the interest rate applicable at the time to the Revolving Loans composing such Borrowing.
 
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(d) Protective Advances and Optional Overadvances .
(i) Any contrary provision of this Agreement or any other Loan Document notwithstanding but subject to Section 2.3(d)(iv) , at any time (A) after the occurrence and during the continuance of a Default or an Event of Default, or (B) that any of the other applicable conditions precedent set forth in Section 3 are not satisfied, Administrative Agent hereby is authorized by Borrowers and the Lenders, from time to time, in Administrative Agent’s sole discretion, to make Revolving Loans to, or for the benefit of, Borrowers, on behalf of the Revolving Lenders, that Administrative Agent, in its Permitted Discretion, deems necessary or desirable (1) to preserve or protect the Collateral, or any portion thereof, or (2) to enhance the likelihood of repayment of the Obligations (other than the Bank Product Obligations) (the Revolving Loans described in this Section 2.3(d)(i) shall be referred to as “ Protective Advances ”), so long as (x) the aggregate amount of all Protective Advances outstanding at any one time does not exceed an amount equal to 5% of the Maximum Revolver Amount, and (y) after giving effect to such Revolving Loans, the outstanding Revolver Usage (except for and excluding amounts charged to the Loan Account for interest, fees, or Lender Group Expenses) does not exceed the lesser of the Maximum Revolver Amount and the Secured Debt Indenture Cap Amount. Administrative Agent’s authorization to make Protective Advances may be revoked at any time by the Required Lenders.
(ii) Any contrary provision of this Agreement or any other Loan Document notwithstanding, but subject to Section 2.3(d)(iv) , the Lenders hereby authorize Administrative Agent or Swing Lender, as applicable (which authorization may be revoked at any time at the written election of the Required Lenders), and either Administrative Agent or Swing Lender, as applicable, may, but is not obligated to, knowingly and intentionally, continue to make Revolving Loans (including Swing Loans) to Borrowers notwithstanding that an Overadvance exists or would be created thereby, so long as (A) after giving effect to such Revolving Loans, the outstanding Revolver Usage does not exceed the Borrowing Base by more than an amount equal to 5% of the Maximum Revolver Amount, and (B) after giving effect to such Revolving Loans, the outstanding Revolver Usage (except for and excluding amounts charged to the Loan Account for interest, fees, or Lender Group Expenses) does not exceed the lesser of the Maximum Revolver Amount and the Secured Debt Indenture Cap Amount. In the event Administrative Agent obtains actual knowledge that the Revolver Usage exceeds the amounts permitted by the immediately foregoing provisions, regardless of the amount of, or reason for, such excess, Administrative Agent shall notify the Lenders as soon as practicable (and prior to making any (or any additional) intentional Overadvances (except for and excluding amounts charged to the Loan Account for interest, fees, or Lender Group Expenses) unless Administrative Agent determines that prior notice would result in imminent harm to the Collateral or its value, in which case Administrative Agent may make such Overadvances and provide notice as promptly as practicable thereafter), and the Lenders with Revolver Commitments thereupon shall, together with Administrative Agent, jointly determine the terms of arrangements that shall be implemented with Borrowers intended to reduce, within a reasonable time, the outstanding principal amount of the Revolving Loans to Borrowers to an amount permitted by the preceding sentence. In such circumstances, if any Lender with a Revolver Commitment objects to the proposed terms of reduction or repayment of any Overadvance, the terms of reduction or repayment thereof shall be implemented according to the determination of the Required Lenders. The foregoing provisions are meant for the benefit of the Lenders and Administrative Agent and are not meant for the benefit of Borrowers, which shall continue to be bound by the provisions of Section 2.4(e)(i) . Each Lender with a Revolver Commitment shall be obligated to settle with Administrative Agent as provided in Section 2.3(e) (or Section 2.3(g) , as applicable) for the amount of such Lender’s Pro Rata Share of any
 
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unintentional Overadvances by Administrative Agent reported to such Lender, any intentional Overadvances made as permitted under this Section 2.3(d)(ii) , and any Overadvances resulting from the charging to the Loan Account of interest, fees, or Lender Group Expenses. Notwithstanding the foregoing, no intentional Overadvance made as permitted under this Section 2.3(d)(ii) may remain outstanding for more than thirty (30) days.
(iii) Each Protective Advance and each Overadvance (each, an “ Extraordinary Advance ”) shall be deemed to be a Revolving Loan hereunder, except that no Extraordinary Advance shall be eligible to be a LIBOR Rate Loan and, prior to Settlement therefor, all payments on the Extraordinary Advances shall be payable to Administrative Agent solely for its own account. The Extraordinary Advances shall be repayable on demand, secured by Administrative Agent’s Liens, constitute Obligations hereunder, and bear interest at the rate applicable from time to time to Revolving Loans that are Base Rate Loans. The provisions of this Section 2.3(d) are for the exclusive benefit of Administrative Agent, Swing Lender, and the Lenders and are not intended to benefit Borrowers (or any other Loan Party) in any way.
(iv) Notwithstanding anything contained in this Agreement or any other Loan Document to the contrary: (A) no Extraordinary Advance may be made by Administrative Agent if such Extraordinary Advance would cause the aggregate principal amount of Extraordinary Advances outstanding to exceed an amount equal to 5% of the Maximum Revolver Amount; and (B) no Extraordinary Advance may be made by Administrative Agent if such Extraordinary Advance would cause the aggregate Revolver Usage to exceed the Maximum Revolver Amount.
(e) Settlement . It is agreed that each Lender’s funded portion of the Revolving Loans is intended by the Lenders to equal, at all times, such Lender’s Pro Rata Share of the outstanding Revolving Loans. Such agreement notwithstanding, Administrative Agent, Swing Lender, and the other Lenders agree (which agreement shall not be for the benefit of Borrowers) that in order to facilitate the administration of this Agreement and the other Loan Documents, settlement among the Lenders as to the Revolving Loans, the Swing Loans, and the Extraordinary Advances shall take place on a periodic basis in accordance with the following provisions:
(i) Administrative Agent shall request settlement (“ Settlement ”) with the Lenders on a weekly basis, or on a more frequent basis if so determined by Administrative Agent in its sole discretion (1) on behalf of Swing Lender, with respect to the outstanding Swing Loans, (2) for itself, with respect to the outstanding Extraordinary Advances, and (3) with respect to Borrowers’ or any of their Subsidiaries’ payments or other amounts received, as to each by notifying the Lenders by telecopy, telephone, or other similar form of transmission, of such requested Settlement, no later noon on the date of such requested Settlement (the date of such requested Settlement being the “ Settlement Date ”). Such notice of a Settlement Date shall include a summary statement of the amount of outstanding Revolving Loans, Swing Loans, and Extraordinary Advances for the period since the prior Settlement Date. Subject to the terms and conditions contained herein (including Section 2.3(g) ): (y) if the amount of the Revolving Loans (including Swing Loans, and Extraordinary Advances) made by a Lender that is not a Defaulting Lender exceeds such Lender’s Pro Rata Share of the Revolving Loans (including Swing Loans, and Extraordinary Advances) as of a Settlement Date, then Administrative Agent shall, by no later than 2:00 p.m. on the Settlement Date, transfer in immediately available funds to a Deposit Account of such Lender (as such Lender may designate), an amount such that each such Lender shall, upon receipt of such amount, have as of the Settlement Date, its Pro Rata Share of the Revolving Loans (including Swing Loans, and Extraordinary Advances), and (z) if the amount of the Revolving Loans (including Swing Loans, and Extraordinary Advances) made by a Lender is less than such Lender’s Pro Rata Share of the Revolving Loans (including Swing
 
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Loans, and Extraordinary Advances) as of a Settlement Date, such Lender shall no later than 2:00 p.m. on the Settlement Date transfer in immediately available funds to Administrative Agent’s Account, an amount such that each such Lender shall, upon transfer of such amount, have as of the Settlement Date, its Pro Rata Share of the Revolving Loans (including Swing Loans and Extraordinary Advances). Such amounts made available to Administrative Agent under clause (z)  of the immediately preceding sentence shall be applied against the amounts of the applicable Swing Loans or Extraordinary Advances and, together with the portion of such Swing Loans or Extraordinary Advances representing Swing Lender’s Pro Rata Share thereof, shall constitute Revolving Loans of such Lenders. If any such amount is not made available to Administrative Agent by any Lender on the Settlement Date applicable thereto to the extent required by the terms hereof, Administrative Agent shall be entitled to recover for its account such amount on demand from such Lender together with interest thereon at the Defaulting Lender Rate.
(ii) In determining whether a Lender’s balance of the Revolving Loans, Swing Loans, and Extraordinary Advances is less than, equal to, or greater than such Lender’s Pro Rata Share of the Revolving Loans, Swing Loans, and Extraordinary Advances as of a Settlement Date, Administrative Agent shall, as part of the relevant Settlement, apply to such balance the portion of payments actually received in good funds by Administrative Agent with respect to principal, interest, fees payable by Borrowers and allocable to the Lenders hereunder, and proceeds of Collateral.
(iii) Between Settlement Dates, Administrative Agent, to the extent Extraordinary Advances or Swing Loans are outstanding, may pay over to Administrative Agent or Swing Lender, as applicable, any payments or other amounts received by Administrative Agent, that in accordance with the terms of this Agreement would be applied to the reduction of the Revolving Loans, for application to the Extraordinary Advances or Swing Loans. Between Settlement Dates, Administrative Agent, to the extent no Extraordinary Advances or Swing Loans are outstanding, may pay over to Swing Lender any payments or other amounts received by Administrative Agent, that in accordance with the terms of this Agreement would be applied to the reduction of the Revolving Loans, for application to Swing Lender’s Pro Rata Share of the Revolving Loans. If, as of any Settlement Date, payments or other amounts of Borrowers or their Subsidiaries received since the then immediately preceding Settlement Date have been applied to Swing Lender’s Pro Rata Share of the Revolving Loans other than to Swing Loans, as provided for in the previous sentence, Swing Lender shall pay to Administrative Agent for the accounts of the Lenders, and Administrative Agent shall pay to the Lenders (other than a Defaulting Lender if Administrative Agent has implemented the provisions of Section 2.3(g) ), to be applied to the outstanding Revolving Loans of such Lenders, an amount such that each such Lender shall, upon receipt of such amount, have, as of such Settlement Date, its Pro Rata Share of the Revolving Loans. During the period between Settlement Dates, Swing Lender with respect to Swing Loans, Administrative Agent with respect to Extraordinary Advances, and each Lender with respect to the Revolving Loans other than Swing Loans and Extraordinary Advances, shall be entitled to interest at the applicable rate or rates payable under this Agreement on the daily amount of funds employed by Swing Lender, Administrative Agent, or the Lenders, as applicable.
(iv) Anything in this Section 2.3(e) to the contrary notwithstanding, in the event that a Lender is a Defaulting Lender, Administrative Agent shall be entitled to refrain from remitting settlement amounts to the Defaulting Lender and, instead, shall be entitled to elect to implement the provisions set forth in Section 2.3(g) .
 
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(f) Notation . Administrative Agent, as a non-fiduciary agent for Borrowers, shall maintain a register showing the principal amount of the Revolving Loans owing to each Lender, including the Swing Loans owing to Swing Lender, and Extraordinary Advances owing to Administrative Agent, and the interests therein of each Lender, from time to time and such register shall, absent manifest error, conclusively be presumed to be correct and accurate.
(g) Defaulting Lenders .
(i) Notwithstanding the provisions of Section 2.4(b)(iii) , Administrative Agent shall not be obligated to transfer to a Defaulting Lender any payments made by Borrowers to Administrative Agent for the Defaulting Lender’s benefit or any proceeds of Collateral that would otherwise be remitted hereunder to the Defaulting Lender, and, in the absence of such transfer to the Defaulting Lender, Administrative Agent shall transfer any such payments (A) first , to Swing Lender to the extent of any Swing Loans that were made by Swing Lender and that were required to be, but were not, paid by the Defaulting Lender, (B) second , to Issuing Bank, to the extent of the portion of a Letter of Credit Disbursement that was required to be, but was not, paid by the Defaulting Lender, (C) third , to each Non-Defaulting Lender ratably in accordance with their Commitments (but, in each case, only to the extent that such Defaulting Lender’s portion of a Revolving Loan (or other funding obligation) was funded by such other Non-Defaulting Lender), (D) to a suspense account maintained by Administrative Agent, the proceeds of which shall be retained by Administrative Agent and may be made available to be re-advanced to or for the benefit of Borrowers (upon the request of Borrowers and subject to the conditions set forth in Section 3.2 ) as if such Defaulting Lender had made its portion of Revolving Loans (or other funding obligations) hereunder, and (E) from and after the date on which all other Obligations have been paid in full, to such Defaulting Lender in accordance with tier (L) of Section 2.4(b)(iii) . Subject to the foregoing, Administrative Agent may hold and, in its discretion, re-lend to Borrowers for the account of such Defaulting Lender the amount of all such payments received and retained by Administrative Agent for the account of such Defaulting Lender. Solely for the purposes of voting or consenting to matters with respect to the Loan Documents (including the calculation of Pro Rata Share in connection therewith) and for the purpose of calculating the fee payable under Section 2.10(b) , such Defaulting Lender shall be deemed not to be a “Lender” and such Lender’s Commitment shall be deemed to be zero; provided , that the foregoing shall not apply to any of the matters governed by Section 14.1(a)(i) through (iii) . The provisions of this Section 2.3(g) shall remain effective with respect to such Defaulting Lender until the earlier of (y) the date on which all of the Non-Defaulting Lenders, Administrative Agent, Issuing Bank, and Borrowers shall have waived, in writing, the application of this Section 2.3(g) to such Defaulting Lender, or (z) the date on which such Defaulting Lender makes payment of all amounts that it was obligated to fund hereunder, pays to Administrative Agent all amounts owing by Defaulting Lender in respect of the amounts that it was obligated to fund hereunder, and, if requested by Administrative Agent, provides adequate assurance of its ability to perform its future obligations hereunder (on which earlier date, so long as no Event of Default has occurred and is continuing, any remaining cash collateral held by Administrative Agent pursuant to Section 2.3(g)(ii) shall be released to Borrowers). The operation of this Section 2.3(g) shall not be construed to increase or otherwise affect the Commitment of any Lender, to relieve or excuse the performance by such Defaulting Lender or any other Lender of its duties and obligations hereunder, or to relieve or excuse the
 
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performance by any Borrower of its duties and obligations hereunder to Administrative Agent, Issuing Bank, or to the Lenders other than such Defaulting Lender. Any failure by a Defaulting Lender to fund amounts that it was obligated to fund hereunder shall constitute a material breach by such Defaulting Lender of this Agreement and shall entitle Borrowers, at their option, upon written notice to Administrative Agent, to arrange for a substitute Lender to assume the Commitment of such Defaulting Lender, such substitute Lender to be reasonably acceptable to Administrative Agent. In connection with the arrangement of such a substitute Lender, the Defaulting Lender shall have no right to refuse to be replaced hereunder, and agrees to execute and deliver a completed form of Assignment and Acceptance in favor of the substitute Lender (and agrees that it shall be deemed to have executed and delivered such document if it fails to do so) subject only to being paid its share of the outstanding Obligations (other than Bank Product Obligations, but including (1) all interest, fees, and other amounts that may be due and payable in respect thereof, and (2) an assumption of its Pro Rata Share of its participation in the Letters of Credit); provided , that any such assumption of the Commitment of such Defaulting Lender shall not be deemed to constitute a waiver of any of the Lender Groups’ or Borrowers’ rights or remedies against any such Defaulting Lender arising out of or in relation to such failure to fund. In the event of a direct conflict between the priority provisions of this Section 2.3(g) and any other provision contained in this Agreement or any other Loan Document, it is the intention of the parties hereto that such provisions be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this Section 2.3(g) shall control and govern.
(ii) If any Swing Loan or Letter of Credit is outstanding at the time that a Lender becomes a Defaulting Lender then:
(A) such Defaulting Lender’s Swing Loan Exposure and Letter of Credit Exposure shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Pro Rata Shares but only to the extent (x) the sum of all Non-Defaulting Lenders’ Revolving Loan Exposures plus such Defaulting Lender’s Swing Loan Exposure and Letter of Credit Exposure does not exceed the total of all Non-Defaulting Lenders’ Revolver Commitments and (y) the conditions set forth in Section 3.2 are satisfied at such time;
(B) if the reallocation described in clause (A)  above cannot, or can only partially, be effected, Borrowers shall within one Business Day following notice by Administrative Agent (x)  first , prepay such Defaulting Lender’s Swing Loan Exposure (after giving effect to any partial reallocation pursuant to clause (A)  above) and (y)  second , cash collateralize such Defaulting Lender’s Letter of Credit Exposure (after giving effect to any partial reallocation pursuant to clause (A)  above), pursuant to a cash collateral agreement to be entered into in form and substance reasonably satisfactory to Administrative Agent, for so long as such Letter of Credit Exposure is outstanding; provided , that Borrowers shall not be obligated to cash collateralize any Defaulting Lender’s Letter of Credit Exposure if such Defaulting Lender is also the Issuing Bank;
(C) if Borrowers cash collateralize any portion of such Defaulting Lender’s Letter of Credit Exposure pursuant to this Section 2.3(g)(ii) , Borrowers shall not be required to pay any Letter of Credit Fees to Administrative Agent for the account of such Defaulting Lender pursuant to Section 2.6(b) with respect to such cash collateralized portion of such Defaulting Lender’s Letter of Credit Exposure during the period such Letter of Credit Exposure is cash collateralized;
 
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(D) to the extent the Letter of Credit Exposure of the Non-Defaulting Lenders is reallocated pursuant to this Section 2.3(g)(ii) , then the Letter of Credit Fees payable to the Non-Defaulting Lenders pursuant to Section 2.6(b) shall be adjusted in accordance with such Non-Defaulting Lenders’ Letter of Credit Exposure;
(E) to the extent any Defaulting Lender’s Letter of Credit Exposure is neither cash collateralized nor reallocated pursuant to this Section 2.3(g)(ii) , then, without prejudice to any rights or remedies of the Issuing Bank or any Lender hereunder, all Letter of Credit Fees that would have otherwise been payable to such Defaulting Lender under Section 2.6(b) with respect to such portion of such Letter of Credit Exposure shall instead be payable to the Issuing Bank until such portion of such Defaulting Lender’s Letter of Credit Exposure is cash collateralized or reallocated;
(F) so long as any Lender is a Defaulting Lender, the Swing Lender shall not be required to make any Swing Loan and the Issuing Bank shall not be required to issue, amend, or increase any Letter of Credit, in each case, to the extent (x) the Defaulting Lender’s Pro Rata Share of such Swing Loans or Letter of Credit cannot be reallocated pursuant to this Section 2.3(g)(ii) or (y) the Swing Lender or Issuing Bank, as applicable, has not otherwise entered into arrangements reasonably satisfactory to the Swing Lender or Issuing Bank, as applicable, and Borrowers to eliminate the Swing Lender’s or Issuing Bank’s risk with respect to the Defaulting Lender’s participation in Swing Loans or Letters of Credit; and
(G) Administrative Agent may release any cash collateral provided by Borrowers pursuant to this Section 2.3(g)(ii) to the Issuing Bank and the Issuing Bank may apply any such cash collateral to the payment of such Defaulting Lender’s Pro Rata Share of any Letter of Credit Disbursement that is not reimbursed by Borrowers pursuant to Section 2.11(d) .
(h) Independent Obligations . All Revolving Loans (other than Swing Loans and Extraordinary Advances) shall be made by the Lenders contemporaneously and in accordance with their Pro Rata Shares. It is understood that (i) no Lender shall be responsible for any failure by any other Lender to perform its obligation to make any Revolving Loan (or other extension of credit) hereunder, nor shall any Commitment of any Lender be increased or decreased as a result of any failure by any other Lender to perform its obligations hereunder, and (ii) no failure by any Lender to perform its obligations hereunder shall excuse any other Lender from its obligations hereunder.
2.4 Payments; Reductions of Commitments; Prepayments .
(a) Payments by Borrowers .
(i) Except as otherwise expressly provided herein, all payments by Borrowers shall be made to Administrative Agent’s Account for the account of the Lender Group and shall be made in immediately available funds, no later than 2:00 p.m. on the date specified herein. Any payment received by Administrative Agent later than 2:00 p.m. shall be deemed to have been received (unless Administrative Agent, in its sole discretion, elects to credit it on the date received) on the following Business Day and any applicable interest or fee shall continue to accrue until such following Business Day.
 
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(ii) Unless Administrative Agent receives notice from Borrowers prior to the date on which any payment is due to the Lenders that Borrowers will not make such payment in full as and when required, Administrative Agent may assume that Borrowers have made (or will make) such payment in full to Administrative Agent on such date in immediately available funds and Administrative Agent may (but shall not be so required), in reliance upon such assumption, distribute to each Lender on such due date an amount equal to the amount then due such Lender. If and to the extent Borrowers do not make such payment in full to Administrative Agent on the date when due, each Lender severally shall repay to Administrative Agent on demand such amount distributed to such Lender, together with interest thereon at the Defaulting Lender Rate for each day from the date such amount is distributed to such Lender until the date repaid.
(b) Apportionment and Application .
(i) So long as no Application Event has occurred and is continuing and except as otherwise provided herein with respect to Defaulting Lenders, all principal and interest payments received by Administrative Agent shall be apportioned ratably among the Lenders (according to the unpaid principal balance of the Obligations to which such payments relate held by each Lender) and all payments of fees and expenses received by Administrative Agent (other than fees or expenses that are for Administrative Agent’s separate account or for the separate account of Issuing Bank) shall be apportioned ratably among the Lenders having a Pro Rata Share of the type of Commitment or Obligation to which a particular fee or expense relates.
(ii) Subject to Section 2.4(b)(iv) and Section 2.4(e) , all payments to be made hereunder by Borrowers shall be remitted to Administrative Agent and all such payments, and all proceeds of Collateral received by Administrative Agent, shall be applied, so long as no Application Event has occurred and is continuing and except as otherwise provided herein with respect to Defaulting Lenders, to reduce the balance of the Revolving Loans outstanding and, thereafter, to Borrowers (to be wired to the Designated Account) or such other Person entitled thereto under applicable law.
(iii) At any time that an Application Event has occurred and is continuing and except as otherwise provided herein with respect to Defaulting Lenders, all payments remitted to Administrative Agent and all proceeds of Collateral received by Administrative Agent shall be applied as follows:
(A) first , to pay any Lender Group Expenses (including cost or expense reimbursements) or indemnities then due to Administrative Agent under the Loan Documents, until paid in full,
(B) second , to pay any fees or premiums then due to Administrative Agent under the Loan Documents until paid in full,
(C) third , to pay interest due in respect of all Protective Advances until paid in full,
(D) fourth , to pay the principal of all Protective Advances until paid in full,
 
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(E) fifth , ratably, to pay any Lender Group Expenses (including cost or expense reimbursements) or indemnities then due to any of the Lenders under the Loan Documents, until paid in full,
(F) sixth , ratably, to pay any fees or premiums then due to any of the Lenders under the Loan Documents until paid in full,
(G) seventh , to pay interest accrued in respect of the Swing Loans until paid in full,
(H) eighth , to pay the principal of all Swing Loans until paid in full,
(I) ninth , ratably, to pay interest accrued in respect of the Revolving Loans (other than Protective Advances) until paid in full,
(J) tenth , ratably
i. ratably, to pay the principal of all Revolving Loans (other than Protective Advances) until paid in full,
ii. to Administrative Agent, to be held by Administrative Agent, for the benefit of Issuing Bank (and for the ratable benefit of each of the Lenders that have an obligation to pay to Administrative Agent, for the account of Issuing Bank, a share of each Letter of Credit Disbursement), as cash collateral in an amount up to 103% of the Letter of Credit Usage (to the extent permitted by applicable law, such cash collateral shall be applied to the reimbursement of any Letter of Credit Disbursement as and when such disbursement occurs and, if a Letter of Credit expires undrawn, the cash collateral held by Administrative Agent in respect of such Letter of Credit shall, to the extent permitted by applicable law, be reapplied pursuant to this Section 2.4(b)(iii) , beginning with tier (A)  hereof),
iii. ratably, up to the amount (after taking into account any amounts previously paid pursuant to this clause iii during the continuation of the applicable Application Event) of the most recently established Bank Product Reserve, which amount was established prior to the occurrence of, and not in contemplation of, the subject Application Event, to (I) the Bank Product Providers based upon amounts then certified by the applicable Bank Product Provider to Administrative Agent (in form and substance satisfactory to Administrative Agent) to be due and payable to such Bank Product Providers on account of Bank Product Obligations, and (II) with any balance to be paid to Administrative Agent, to be held by Administrative Agent, for the ratable benefit of the Bank Product Providers, as cash collateral (which cash collateral may be released by Administrative Agent to the applicable Bank Product Provider and applied by such Bank Product Provider to the payment or reimbursement of any amounts due and payable with respect to Bank Product Obligations owed to the applicable Bank Product Provider as and when such amounts first become due and payable and, if and at such time as all such Bank Product Obligations are paid or otherwise satisfied in full, the cash collateral held by Administrative Agent in respect of such Bank Product Obligations shall be reapplied pursuant to this Section 2.4(b)(iii) , beginning with tier (A)  hereof,
(K) eleventh , to pay any other Obligations other than Obligations owed to Defaulting Lenders,
 
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(L) twelfth , ratably to pay any Obligations owed to Defaulting Lenders; and
(M) thirteenth , to Borrowers (to be wired to the Designated Account) or such other Person entitled thereto under applicable law.
(iv) Administrative Agent promptly shall distribute to each Lender, pursuant to the applicable wire instructions received from each Lender in writing, such funds as it may be entitled to receive, subject to a Settlement delay as provided in Section 2.3(e) .
(v) In each instance, so long as no Application Event has occurred and is continuing, Section 2.4(b)(i) shall not apply to any payment made by Borrowers to Administrative Agent and specified by Borrowers to be for the payment of specific Obligations then due and payable (or prepayable) under any provision of this Agreement or any other Loan Document.
(vi) For purposes of Section 2.4(b)(iii) , “paid in full” of a type of Obligation means payment in cash or immediately available funds of all amounts owing on account of such type of Obligation, including interest accrued after the commencement of any Insolvency Proceeding, default interest, interest on interest, fee reimbursements, and expense reimbursements, irrespective of whether any of the foregoing would be or is allowed or disallowed in whole or in part in any Insolvency Proceeding.
(vii) In the event of a direct conflict between the priority provisions of this Section 2.4 and any other provision contained in this Agreement or any other Loan Document, it is the intention of the parties hereto that such provisions be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, if the conflict relates to the provisions of Section 2.3(g) and this Section 2.4 , then the provisions of Section 2.3(g) shall control and govern, and if otherwise, then the terms and provisions of this Section 2.4 shall control and govern.
(c) Reduction of Commitments .
(i) Revolver Commitments . The Revolver Commitments shall terminate on the Maturity Date. Borrowers may reduce the Revolver Commitments, without premium or penalty, to an amount (which may be zero) not less than the sum of (A) the Revolver Usage as of such date, plus (B) the principal amount of all Revolving Loans not yet made as to which a request has been given by Borrowers under Section 2.3(a) , plus (C) the amount of all Letters of Credit not yet issued as to which a request has been given by Borrowers pursuant to Section 2.11(a) . Each such reduction shall be in an amount which is not less than $10,000,000 (unless the Revolver Commitments are being reduced to zero and the amount of the Revolver Commitments in effect immediately prior to such reduction are less than $10,000,000), shall be made by providing not less than 10 Business Days’ prior written notice to Administrative Agent, and shall be irrevocable. Once reduced, the Revolver Commitments may not be increased. Each such reduction of the Revolver Commitments shall reduce the Revolver Commitments of each Lender proportionately in accordance with its ratable share thereof.
(ii) [Reserved].
 
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(d) Optional Prepayments .
(i) Revolving Loans . Borrowers may prepay the principal of any Revolving Loan at any time in whole or in part, without premium or penalty.
(ii) [Reserved].
(e) Mandatory Prepayments .
(i) Borrowing Base . Subject to Section 2.3(d) , if, at any time, (A) the Revolver Usage on such date exceeds (B) the Borrowing Base reflected in the Borrowing Base Certificate most recently delivered by Borrowers to Administrative Agent, then Borrowers shall promptly (but in any event within 1 Business Day of any Borrower’s obtaining knowledge of such excess) prepay the Obligations in accordance with Section 2.4(f)(i) in an aggregate amount equal to the amount of such excess.
(ii) [Reserved].
(f) Application of Payments .
(i) Each prepayment pursuant to Section 2.4(e)(i)  shall, (A) so long as no Application Event shall have occurred and be continuing, be applied as follows: first , to the outstanding principal amount of the Revolving Loans (without a corresponding permanent reduction in the Maximum Revolver Amount) until paid in full; and second , to cash collateralize the Letters of Credit in an amount equal to 103% of the then outstanding Letter of Credit Usage (without a corresponding permanent reduction in the Maximum Revolver Amount); and (B) if an Application Event shall have occurred and be continuing, be applied in the manner set forth in Section 2.4(b)(iii) .
(ii) [Reserved].
2.5 Promise to Pay; Promissory Notes .
(a) Borrowers agree to pay the Lender Group Expenses on the earlier of (i) the first day of the month following the date on which the applicable Lender Group Expenses were first incurred or (ii) the date on which demand therefor is made by Administrative Agent (it being acknowledged and agreed that any charging of such costs, expenses or Lender Group Expenses to the Loan Account pursuant to the provisions of Section 2.6(d) shall be deemed to constitute a demand for payment thereof for the purposes of this subclause (ii) ). Borrowers promise to pay all of the Obligations (including principal, interest, premiums, if any, fees, costs, and expenses (including Lender Group Expenses)) in full on the Maturity Date or, if earlier, on the date on which the Obligations (other than the Bank Product Obligations) become due and payable pursuant to the terms of this Agreement. Borrowers agree that their obligations contained in the first sentence of this Section 2.5(a) shall survive payment or satisfaction in full of all other Obligations.
(b) Any Lender may request that any portion of its Commitments or the Loans made by it be evidenced by one or more promissory notes. In such event, Borrowers shall execute and deliver to such Lender the requested promissory notes payable to the order of such Lender in a form furnished by Administrative Agent and reasonably satisfactory to Borrowers. Thereafter, the portion of the Commitments and Loans evidenced by such promissory notes and interest thereon shall at all times be represented by one or more promissory notes in such form payable to the order of the payee named therein.
 
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2.6 Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations .
(a) Interest Rates . Except as provided in Section 2.6(c) , all Obligations (except for undrawn Letters of Credit) that have been charged to the Loan Account pursuant to the terms hereof shall bear interest as follows:
(i) if the relevant Obligation is a LIBOR Rate Loan, at a per annum rate equal to the LIBOR Rate plus the Applicable Margin, and
(ii) otherwise, at a per annum rate equal to the Base Rate plus the Applicable Margin.
(b) Letter of Credit Fee . Borrowers shall pay Administrative Agent (for the ratable benefit of the Revolving Lenders), a Letter of Credit fee (the “ Letter of Credit Fee ”) (which fee shall be in addition to the fronting fees and commissions, other fees, charges and expenses set forth in Section 2.11(k) ) that shall accrue at a per annum rate equal to the Applicable Margin for Revolving Loans that are LIBOR Rate Loans times the undrawn amount of all outstanding Letters of Credit.
(c) Default Rate . Upon the occurrence and during the continuation of an Event of Default and at the election of Administrative Agent or the Required Lenders,
(i) all Obligations (except for undrawn Letters of Credit) that have been charged to the Loan Account pursuant to the terms hereof shall bear interest at a per annum rate equal to 2 percentage points above the per annum rate otherwise applicable thereunder, and
(ii) the Letter of Credit Fee shall be increased to 2 percentage points above the per annum rate otherwise applicable hereunder.
(d) Payment . Except to the extent provided to the contrary in Section 2.10 , Section 2.11(k) , or Section 2.12(a) , (i) all interest, all Letter of Credit Fees and all other fees payable hereunder or under any of the other Loan Documents shall be due and payable, in arrears, on the first day of each month, and (ii) all costs and expenses payable hereunder or under any of the other Loan Documents, and all Lender Group Expenses shall be due and payable on the earlier of (x) the first day of the month following the date on which the applicable costs, expenses, or Lender Group Expenses were first incurred or (y) the date on which demand therefor is made by Administrative Agent (it being acknowledged and agreed that any charging of such costs, expenses or Lender Group Expenses to the Loan Account pursuant to the provisions of the following sentence shall be deemed to constitute a demand for payment thereof for the purposes of this subclause (y) ). Borrowers hereby authorize Administrative Agent, from time to time without prior notice to Borrowers, to charge to the Loan Account (A) on the first day of each month, all interest accrued during the prior month on the Revolving Loans hereunder, (B) on the first day of each month, all Letter of Credit Fees accrued or chargeable hereunder during the prior month, (C) as and when incurred or accrued, all fees and costs provided for in Section 2.10(a) or (c), (D) on the first day of each month, the Unused Line Fee accrued during the prior month pursuant to Section 2.10(b) , (E) as and when due and payable, all other fees payable hereunder or
 
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under any of the other Loan Documents, (F) as and when incurred or accrued, the fronting fees and all commissions, other fees, charges and expenses provided for in Section 2.11(k) , (G) as and when incurred or accrued, all other Lender Group Expenses, and (H) as and when due and payable all other payment obligations payable under any Loan Document or any Bank Product Agreement (including any amounts due and payable to the Bank Product Providers in respect of Bank Products). All amounts (including interest, fees, costs, expenses, Lender Group Expenses, or other amounts payable hereunder or under any other Loan Document or under any Bank Product Agreement) charged to the Loan Account shall thereupon constitute Revolving Loans hereunder, shall constitute Obligations hereunder, and shall initially accrue interest at the rate then applicable to Revolving Loans that are Base Rate Loans (unless and until converted into LIBOR Rate Loans in accordance with the terms of this Agreement).
(e) Computation . All interest and fees chargeable under the Loan Documents shall be computed on the basis of a 360-day year and actual days elapsed, other than for Base Rate Loans, which shall be calculated on the basis of a 365- or 366-day year, as applicable, and actual days elapsed. In the event the Base Rate is changed from time to time hereafter, the rates of interest hereunder based upon the Base Rate automatically and immediately shall be increased or decreased by an amount equal to such change in the Base Rate.
(f) Intent to Limit Charges to Maximum Lawful Rate . In no event shall the interest rate or rates payable under this Agreement, plus any other amounts paid in connection herewith, exceed the highest rate permissible under any law that a court of competent jurisdiction shall, in a final determination, deem applicable. Borrowers and the Lender Group, in executing and delivering this Agreement, intend legally to agree upon the rate or rates of interest and manner of payment stated within it; provided , that, anything contained herein to the contrary notwithstanding, if such rate or rates of interest or manner of payment exceeds the maximum allowable under applicable law, then, ipso facto , as of the date of this Agreement, Borrowers are and shall be liable only for the payment of such maximum amount as is allowed by law, and payment received from Borrowers in excess of such legal maximum, whenever received, shall be applied to reduce the principal balance of the Obligations to the extent of such excess.
2.7 Crediting Payments . The receipt of any payment item by Administrative Agent shall not be required to be considered a payment on account unless such payment item is a wire transfer of immediately available federal funds made to Administrative Agent’s Account or unless and until such payment item is honored when presented for payment. Should any payment item not be honored when presented for payment, then Borrowers shall be deemed not to have made such payment and interest shall be calculated accordingly. Anything to the contrary contained herein notwithstanding, any payment item shall be deemed received by Administrative Agent only if it is received into Administrative Agent’s Account on a Business Day on or before 2:00 p.m. If any payment item is received into Administrative Agent’s Account on a non-Business Day or after 2:00 p.m. on a Business Day (unless Administrative Agent, in its sole discretion, elects to credit it on the date received), it shall be deemed to have been received by Administrative Agent as of the opening of business on the immediately following Business Day.
2.8 Designated Account . Administrative Agent is authorized to make the Revolving Loans, and Issuing Bank is authorized to issue the Letters of Credit, under this Agreement based upon telephonic or other instructions received from anyone purporting to be an Authorized Person or, without instructions, if pursuant to Section 2.6(d) . Borrowers agree to establish and maintain the Designated Account with the
 
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Designated Account Bank for the purpose of receiving the proceeds of the Revolving Loans requested by Borrowers and made by Administrative Agent or the Lenders hereunder. Unless otherwise agreed by Administrative Agent and Borrowers, any Revolving Loan or Swing Loan requested by Borrowers and made by Administrative Agent or the Lenders hereunder shall be made to the Designated Account.
2.9 Maintenance of Loan Account; Statements of Obligations . Administrative Agent shall maintain an account on its books in the name of Borrowers (the “ Loan Account ”) on which Borrowers will be charged with all Revolving Loans (including Extraordinary Advances and Swing Loans) made by Administrative Agent, Swing Lender, or the Lenders to Borrowers or for Borrowers’ account, the Letters of Credit issued or arranged by Issuing Bank for Borrowers’ account, and with all other payment Obligations hereunder or under the other Loan Documents, including, accrued interest, fees and expenses, and Lender Group Expenses. In accordance with Section 2.7 , the Loan Account will be credited with all payments received by Administrative Agent from Borrowers or for Borrowers’ account. Administrative Agent shall make available to Borrowers monthly statements regarding the Loan Account, including the principal amount of the Revolving Loans, interest accrued hereunder, fees accrued or charged hereunder or under the other Loan Documents, and a summary itemization of all charges and expenses constituting Lender Group Expenses accrued hereunder or under the other Loan Documents, and each such statement, absent manifest error, shall be conclusively presumed to be correct and accurate and constitute an account stated between Borrowers and the Lender Group unless, within 30 days after Administrative Agent first makes such a statement available to Borrowers, Borrowers shall deliver to Administrative Agent written objection thereto describing the error or errors contained in such statement.
2.10 Fees .
(a) Administrative Agent Fees . Borrowers shall pay to Administrative Agent, for the account of Administrative Agent, as and when due and payable under the terms of the Fee Letter, the fees set forth in the Fee Letter.
(b) Unused Line Fee . Borrowers shall pay to Administrative Agent, for the ratable account of the Revolving Lenders, an unused line fee (the “ Unused Line Fee ”) in an amount equal to the Applicable Unused Line Fee Percentage per annum times the result of (i) the aggregate amount of the Revolver Commitments, less (ii) the average amount of the Revolver Usage during the immediately preceding month (or portion thereof), which Unused Line Fee shall be due and payable on the first day of each month from and after the Closing Date up to the first day of the month prior to the date on which the Obligations are paid in full and on the date on which the Obligations are paid in full.
(c) Field Examination and Other Fees . Borrowers shall pay to Administrative Agent, field examination, appraisal, and valuation fees and charges, as and when incurred or chargeable, as follows (i) a fee of $1,000 per day, per examiner, plus out-of-pocket expenses (including travel, meals, and lodging) for each field examination of any Borrower performed by personnel employed by Administrative Agent, and (ii) the fees or charges paid or incurred by Administrative Agent (but, in any event, no less than a charge of $1,000 per day, per Person, plus out-of-pocket expenses (including travel, meals, and lodging)) if it elects to employ the services of one or more third Persons to perform field examinations of any Borrower or its Subsidiaries, to establish electronic collateral reporting systems, to appraise the Collateral, or any portion thereof, or to assess any Borrower’s or its Subsidiaries’ business valuation; provided , that (A) Borrowers shall be obligated to reimburse Administrative Agent for all field examinations and appraisals of Inventory conducted at any time an Event of Default shall have occurred and be continuing; (B) so long as no Event of Default shall have occurred
 
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and be continuing, Borrowers shall not be obligated to reimburse Administrative Agent during any calendar year for more than 1 field examination and more than 1 full appraisal of Inventory; and (C) without duplication or limitation of the preceding subclauses (A) and (B) , so long as no Event of Default shall have occurred and be continuing, Borrowers shall not be obligated to reimburse Administrative Agent during any calendar year for any additional field examinations or appraisals of Inventory unless at any time during such calendar year the Combined Availability falls below the greater of $93,750,000 and 12.5% of the Combined Commitment, in which case, so long as no Event of Default shall have occurred and be continuing, Borrowers shall not be obligated to reimburse Administrative Agent during such calendar year for more than 1 such additional field examination and/or more than 1 such additional appraisal of Inventory, as applicable.
2.11 Letters of Credit .
(a) Subject to the terms and conditions of this Agreement, upon the request of Borrowers made in accordance herewith, and prior to the Maturity Date, Issuing Bank agrees to issue a requested Letter of Credit for the account of Borrowers. By submitting a request to Issuing Bank for the issuance of a Letter of Credit, Borrowers shall be deemed to have requested that Issuing Bank issue the requested Letter of Credit. Each request for the issuance of a Letter of Credit, or the amendment, renewal, or extension of any outstanding Letter of Credit, shall be irrevocable and shall be made in writing by an Authorized Person and delivered to Issuing Bank via telefacsimile or other electronic method of transmission reasonably acceptable to Issuing Bank and reasonably in advance of the requested date of issuance, amendment, renewal, or extension. Each such request shall be in form and substance reasonably satisfactory to Issuing Bank and (i) shall specify (A) the amount of such Letter of Credit, (B) the date of issuance, amendment, renewal, or extension of such Letter of Credit, (C) the proposed expiration date of such Letter of Credit (which expiration date shall not be later than the earlier of (1) the date that is 1 year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, including any automatic renewal provision, 1 year after such renewal or extension), and (2) the date that is 5 Business Days before the Maturity Date, (D) the name and address of the beneficiary of the Letter of Credit, and (E) such other information (including, the conditions to drawing, and, in the case of an amendment, renewal, or extension, identification of the Letter of Credit to be so amended, renewed, or extended) as shall be necessary to prepare, amend, renew, or extend such Letter of Credit, and (ii) shall be accompanied by such Issuer Documents as Administrative Agent or Issuing Bank may request or require, to the extent that such requests or requirements are consistent with the Issuer Documents that Issuing Bank generally requests for Letters of Credit in similar circumstances. Bank’s records of the content of any such request will be conclusive. Anything contained herein to the contrary notwithstanding, Issuing Bank may, but shall not be obligated to, issue a Letter of Credit that supports the obligations of Borrowers or one of their Subsidiaries in respect of a lease of real property or an employment contract.
(b) Issuing Bank shall have no obligation to issue a Letter of Credit if any of the following would result after giving effect to the requested issuance:
(i) the Letter of Credit Usage would exceed $20,000,000, or
(ii) the Letter of Credit Usage would exceed (A)  the least of (1) the Maximum Revolver Amount, (2) the Borrowing Base at such time, and (3) the Secured Debt Indenture Cap Amount at such time, less (B) the outstanding amount of Revolving Loans (including Swing Loans).
 
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(c) In the event there is a Defaulting Lender as of the date of any request for the issuance of a Letter of Credit, the Issuing Bank shall not be required to issue or arrange for such Letter of Credit to the extent (i) the Defaulting Lender’s Letter of Credit Exposure with respect to such Letter of Credit may not be reallocated pursuant to Section 2.3(g)(ii) , or (ii) the Issuing Bank has not otherwise entered into arrangements reasonably satisfactory to it and Borrowers to eliminate the Issuing Bank’s risk with respect to the participation in such Letter of Credit of the Defaulting Lender, which arrangements may include Borrowers cash collateralizing such Defaulting Lender’s Letter of Credit Exposure in accordance with Section 2.3(g)(ii) . Additionally, Issuing Bank shall have no obligation to issue a Letter of Credit if (A) any order, judgment, or decree of any Governmental Authority or arbitrator shall, by its terms, purport to enjoin or restrain Issuing Bank from issuing such Letter of Credit, or any law applicable to Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over Issuing Bank shall prohibit or request that Issuing Bank refrain from the issuance of letters of credit generally or such Letter of Credit in particular, (B) the issuance of such Letter of Credit would violate one or more policies of Issuing Bank applicable to letters of credit generally, or (C) if amounts demanded to be paid under any Letter of Credit will or may not be in United States Dollars.
(d) Any Issuing Bank (other than Wells Fargo or any of its Affiliates) shall notify Administrative Agent in writing no later than the Business Day immediately following the Business Day on which such Issuing Bank issued any Letter of Credit; provided that (i) until Administrative Agent advises any such Issuing Bank that the provisions of Section 3.2 are not satisfied, or (ii) unless the aggregate amount of the Letters of Credit issued in any such week exceeds such amount as shall be agreed by Administrative Agent and such Issuing Bank, such Issuing Bank shall be required to so notify Administrative Agent in writing only once each week of the Letters of Credit issued by such Issuing Bank during the immediately preceding week as well as the daily amounts outstanding for the prior week, such notice to be furnished on such day of the week as Administrative Agent and such Issuing Bank may agree. Borrowers and the Lender Group hereby acknowledge and agree that all Existing Letters of Credit shall constitute Letters of Credit under this Agreement on and after the Closing Date with the same effect as if such Existing Letters of Credit were issued by Issuing Bank at the request of Borrowers on the Closing Date. Each Letter of Credit shall be in form and substance reasonably acceptable to Issuing Bank, including the requirement that the amounts payable thereunder must be payable in Dollars. If Issuing Bank makes a payment under a Letter of Credit, Borrowers shall pay to Administrative Agent an amount equal to the applicable Letter of Credit Disbursement on the Business Day such Letter of Credit Disbursement is made and, in the absence of such payment, the amount of the Letter of Credit Disbursement immediately and automatically shall be deemed to be a Revolving Loan hereunder (notwithstanding any failure to satisfy any condition precedent set forth in Section 3 ) and, initially, shall bear interest at the rate then applicable to Revolving Loans that are Base Rate Loans. If a Letter of Credit Disbursement is deemed to be a Revolving Loan hereunder, Borrowers’ obligation to pay the amount of such Letter of Credit Disbursement to Issuing Bank shall be automatically converted into an obligation to pay the resulting Revolving Loan. Promptly following receipt by Administrative Agent of any payment from Borrowers pursuant to this paragraph, Administrative Agent shall distribute such payment to Issuing Bank or, to the extent that Revolving Lenders have made payments pursuant to Section 2.11(e) to reimburse Issuing Bank, then to such Revolving Lenders and Issuing Bank as their interests may appear.
(e) Promptly following receipt of a notice of a Letter of Credit Disbursement pursuant to Section 2.11(d) , each Revolving Lender agrees to fund its Pro Rata Share of any Revolving
 
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Loan deemed made pursuant to Section 2.11(d) on the same terms and conditions as if Borrowers had requested the amount thereof as a Revolving Loan and Administrative Agent shall promptly pay to Issuing Bank the amounts so received by it from the Revolving Lenders. By the issuance of a Letter of Credit (or an amendment, renewal, or extension of a Letter of Credit) and without any further action on the part of Issuing Bank or the Revolving Lenders, Issuing Bank shall be deemed to have granted to each Revolving Lender, and each Revolving Lender shall be deemed to have purchased, a participation in each Letter of Credit issued by Issuing Bank, in an amount equal to its Pro Rata Share of such Letter of Credit, and each such Revolving Lender agrees to pay to Administrative Agent, for the account of Issuing Bank, such Revolving Lender’s Pro Rata Share of any Letter of Credit Disbursement made by Issuing Bank under the applicable Letter of Credit. In consideration and in furtherance of the foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to pay to Administrative Agent, for the account of Issuing Bank, such Revolving Lender’s Pro Rata Share of each Letter of Credit Disbursement made by Issuing Bank and not reimbursed by Borrowers on the date due as provided in Section 2.11(d) , or of any reimbursement payment that is required to be refunded (or that Administrative Agent or Issuing Bank elects, based upon the advice of counsel, to refund) to Borrowers for any reason. Each Revolving Lender acknowledges and agrees that its obligation to deliver to Administrative Agent, for the account of Issuing Bank, an amount equal to its respective Pro Rata Share of each Letter of Credit Disbursement pursuant to this Section 2.11(e)  shall be absolute and unconditional and such remittance shall be made notwithstanding the occurrence or continuation of an Event of Default or Default or the failure to satisfy any condition set forth in Section 3 . If any such Revolving Lender fails to make available to Administrative Agent the amount of such Revolving Lender’s Pro Rata Share of a Letter of Credit Disbursement as provided in this Section, such Revolving Lender shall be deemed to be a Defaulting Lender and Administrative Agent (for the account of Issuing Bank) shall be entitled to recover such amount on demand from such Revolving Lender together with interest thereon at the Defaulting Lender Rate until paid in full.
(f) Each Borrower agrees to indemnify, defend and hold harmless each member of the Lender Group (including Issuing Bank and its branches, Affiliates, and correspondents) and each such Person’s respective directors, officers, employees, attorneys and agents (each, including Issuing Bank, a “ Letter of Credit Related Person ”) (to the fullest extent permitted by law) from and against any and all claims, demands, suits, actions, investigations, proceedings, liabilities, fines, costs, penalties, and damages, and all reasonable fees and disbursements of attorneys, experts, or consultants and all other costs and expenses actually incurred in connection therewith or in connection with the enforcement of this indemnification (as and when they are incurred and irrespective of whether suit is brought), which may be incurred by or awarded against any such Letter of Credit Related Person (other than Taxes, which shall be governed by Section 16 ) (the “ Letter of Credit Indemnified Costs ”), and which arise out of or in connection with, or as a result of:
(i) any Letter of Credit or any pre-advice of its issuance;
(ii) any transfer, sale, delivery, surrender or endorsement of any Drawing Document at any time(s) held by any such Letter of Credit Related Person in connection with any Letter of Credit;
(iii) any action or proceeding arising out of, or in connection with, any Letter of Credit (whether administrative, judicial or in connection with arbitration), including any action or proceeding to compel or restrain any presentation or payment under any Letter of Credit, or for the wrongful dishonor of, or honoring a presentation under, any Letter of Credit;
 
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(iv) any independent undertakings issued by the beneficiary of any Letter of Credit;
(v) any unauthorized instruction or request made to Issuing Bank in connection with any Letter of Credit or requested Letter of Credit or error in computer or electronic transmission;
(vi) an adviser, confirmer or other nominated person seeking to be reimbursed, indemnified or compensated;
(vii) any third party seeking to enforce the rights of an applicant, beneficiary, nominated person, transferee, assignee of Letter of Credit proceeds or holder of an instrument or document;
(viii) the fraud, forgery or illegal action of parties other than the Letter of Credit Related Person;
(ix) Issuing Bank’s performance of the obligations of a confirming institution or entity that wrongfully dishonors a confirmation; or
(x) the acts or omissions, whether rightful or wrongful, of any present or future de jure or de facto governmental or regulatory authority or cause or event beyond the control of the Letter of Credit Related Person;
in each case, including that resulting from the Letter of Credit Related Person’s own negligence; provided , however , that such indemnity shall not be available to any Letter of Credit Related Person claiming indemnification under clauses (i)  through (x)  above to the extent that such Letter of Credit Indemnified Costs may be finally determined in a final, non-appealable judgment of a court of competent jurisdiction to have resulted directly from the gross negligence or willful misconduct of the Letter of Credit Related Person claiming indemnity. Borrowers hereby agree to pay the Letter of Credit Related Person claiming indemnity on demand from time to time all amounts owing under this Section 2.11(f) . If and to the extent that the obligations of Borrowers under this Section 2.11(f) are unenforceable for any reason, Borrowers agree to make the maximum contribution to the Letter of Credit Indemnified Costs permissible under applicable law. This indemnification provision shall survive termination of this Agreement and all Letters of Credit.
(g) The liability of Issuing Bank (or any other Letter of Credit Related Person) under, in connection with or arising out of any Letter of Credit (or pre-advice), regardless of the form or legal grounds of the action or proceeding, shall be limited to direct damages suffered by Borrowers that are caused directly by Issuing Bank’s gross negligence or willful misconduct in (i) honoring a presentation under a Letter of Credit that on its face does not at least substantially comply with the terms and conditions of such Letter of Credit, (ii) failing to honor a presentation under a Letter of Credit that strictly complies with the terms and conditions of such Letter of Credit or (iii) retaining Drawing Documents presented under a Letter of Credit. Issuing Bank shall be deemed to have acted with due diligence and reasonable care if Issuing Bank’s conduct is in accordance with Standard Letter of Credit
 
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Practice or in accordance with this Agreement. Borrowers’ aggregate remedies against Issuing Bank and any Letter of Credit Related Person for wrongfully honoring a presentation under any Letter of Credit or wrongfully retaining honored Drawing Documents shall in no event exceed the aggregate amount paid by Borrowers to Issuing Bank in respect of the honored presentation in connection with such Letter of Credit under Section 2.11(d) , plus interest at the rate then applicable to Base Rate Loans hereunder. Borrowers shall take action to avoid and mitigate the amount of any damages claimed against Issuing Bank or any other Letter of Credit Related Person, including by enforcing its rights against the beneficiaries of the Letters of Credit. Any claim by Borrowers under or in connection with any Letter of Credit shall be reduced by an amount equal to the sum of (x) the amount (if any) saved by Borrowers as a result of the breach or alleged wrongful conduct complained of; and (y) the amount (if any) of the loss that would have been avoided had Borrowers taken all reasonable steps to mitigate any loss, and in case of a claim of wrongful dishonor, by specifically and timely authorizing Issuing Bank to effect a cure.
(h) Borrowers are responsible for preparing or approving the final text of the Letter of Credit as issued by Issuing Bank, irrespective of any assistance Issuing Bank may provide such as drafting or recommending text or by Issuing Bank’s use or refusal to use text submitted by Borrowers. Borrowers are solely responsible for the suitability of the Letter of Credit for Borrowers’ purposes. With respect to any Letter of Credit containing an “automatic amendment” to extend the expiration date of such Letter of Credit, Issuing Bank, in its sole and absolute discretion, may give notice of nonrenewal of such Letter of Credit and, if Borrowers do not at any time want such Letter of Credit to be renewed, Borrowers will so notify Administrative Agent and Issuing Bank at least 15 calendar days before Issuing Bank is required to notify the beneficiary of such Letter of Credit or any advising bank of such nonrenewal pursuant to the terms of such Letter of Credit.
(i) Borrowers’ reimbursement and payment obligations under this Section 2.11 are absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever, including:
(i) any lack of validity, enforceability or legal effect of any Letter of Credit or this Agreement or any term or provision therein or herein;
(ii) payment against presentation of any draft, demand or claim for payment under any Drawing Document that does not comply in whole or in part with the terms of the applicable Letter of Credit or which proves to be fraudulent, forged or invalid in any respect or any statement therein being untrue or inaccurate in any respect, or which is signed, issued or presented by a Person or a transferee of such Person purporting to be a successor or transferee of the beneficiary of such Letter of Credit;
(iii) Issuing Bank or any of its branches or Affiliates being the beneficiary of any Letter of Credit;
(iv) Issuing Bank or any correspondent honoring a drawing against a Drawing Document up to the amount available under any Letter of Credit even if such Drawing Document claims an amount in excess of the amount available under the Letter of Credit;
 
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(v) the existence of any claim, set-off, defense or other right that any Borrower or any of its Subsidiaries may have at any time against any beneficiary, any assignee of proceeds, Issuing Bank or any other Person;
(vi) any other event, circumstance or conduct whatsoever, whether or not similar to any of the foregoing that might, but for this Section 2.11(i) , constitute a legal or equitable defense to or discharge of, or provide a right of set-off against, any Borrower’s or any of its Subsidiaries’ reimbursement and other payment obligations and liabilities, arising under, or in connection with, any Letter of Credit, whether against Issuing Bank, the beneficiary or any other Person; or
(vii) the fact that any Default or Event of Default shall have occurred and be continuing;
provided , however , that subject to Section 2.11(g) above, the foregoing shall not release Issuing Bank from such liability to Borrowers as may be finally determined in a final, non-appealable judgment of a court of competent jurisdiction against Issuing Bank following reimbursement or payment of the obligations and liabilities, including reimbursement and other payment obligations, of Borrowers to Issuing Bank arising under, or in connection with, this Section 2.11 or any Letter of Credit.
(j) Without limiting any other provision of this Agreement, Issuing Bank and each other Letter of Credit Related Person (if applicable) shall not be responsible to Borrowers for, and Issuing Bank’s rights and remedies against Borrowers and the obligation of Borrowers to reimburse Issuing Bank for each drawing under each Letter of Credit shall not be impaired by:
(i) honor of a presentation under any Letter of Credit that on its face substantially complies with the terms and conditions of such Letter of Credit, even if the Letter of Credit requires strict compliance by the beneficiary;
(ii) honor of a presentation of any Drawing Document that appears on its face to have been signed, presented or issued (A) by any purported successor or transferee of any beneficiary or other Person required to sign, present or issue such Drawing Document or (B) under a new name of the beneficiary;
(iii) acceptance as a draft of any written or electronic demand or request for payment under a Letter of Credit, even if nonnegotiable or not in the form of a draft or notwithstanding any requirement that such draft, demand or request bear any or adequate reference to the Letter of Credit;
(iv) the identity or authority of any presenter or signer of any Drawing Document or the form, accuracy, genuineness or legal effect of any Drawing Document (other than Issuing Bank’s determination that such Drawing Document appears on its face substantially to comply with the terms and conditions of the Letter of Credit);
(v) acting upon any instruction or request relative to a Letter of Credit or requested Letter of Credit that Issuing Bank in good faith believes to have been given by a Person authorized to give such instruction or request;
 
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(vi) any errors, omissions, interruptions or delays in transmission or delivery of any message, advice or document (regardless of how sent or transmitted) or for errors in interpretation of technical terms or in translation or any delay in giving or failing to give notice to Borrowers;
(vii) any acts, omissions or fraud by, or the insolvency of, any beneficiary, any nominated person or entity or any other Person or any breach of contract between any beneficiary and any Borrower or any of the parties to the underlying transaction to which the Letter of Credit relates;
(viii) assertion or waiver of any provision of the ISP or UCP that primarily benefits an issuer of a letter of credit, including any requirement that any Drawing Document be presented to it at a particular hour or place;
(ix) payment to any paying or negotiating bank (designated or permitted by the terms of the applicable Letter of Credit) claiming that it rightfully honored or is entitled to reimbursement or indemnity under Standard Letter of Credit Practice applicable to it;
(x) acting or failing to act as required or permitted under Standard Letter of Credit Practice applicable to where Issuing Bank has issued, confirmed, advised or negotiated such Letter of Credit, as the case may be;
(xi) honor of a presentation after the expiration date of any Letter of Credit notwithstanding that a presentation was made prior to such expiration date and dishonored by Issuing Bank if subsequently Issuing Bank or any court or other finder of fact determines such presentation should have been honored;
(xii) dishonor of any presentation that does not strictly comply or that is fraudulent, forged or otherwise not entitled to honor; or
(xiii) honor of a presentation that is subsequently determined by Issuing Bank to have been made in violation of international, federal, state or local restrictions on the transaction of business with certain prohibited Persons.
(k) Borrowers shall pay immediately upon demand to Administrative Agent for the account of Issuing Bank as non-refundable fees, commissions, and charges (it being acknowledged and agreed that any charging of such fees, commissions, and charges to the Loan Account pursuant to the provisions of Section 2.6(d) shall be deemed to constitute a demand for payment thereof for the purposes of this Section 2.11(k) ): (i) a fronting fee which shall be imposed by Issuing Bank upon the issuance of each Letter of Credit of 0.125% per annum of the face amount thereof, plus (ii) any and all other customary commissions, fees and charges then in effect imposed by, and any and all expenses incurred by, Issuing Bank, or by any adviser, confirming institution or entity or other nominated person, relating to Letters of Credit, at the time of issuance of any Letter of Credit and upon the occurrence of any other activity with respect to any Letter of Credit (including transfers, assignments of proceeds, amendments, drawings, renewals or cancellations).
(l) If by reason of (x) any Change in Law, or (y) compliance by Issuing Bank or any other member of the Lender Group with any direction, request, or requirement (irrespective of whether having the force of law) of any Governmental Authority or monetary authority including, Regulation D of the Board of Governors as from time to time in effect (and any successor thereto):
(i) any reserve, deposit, or similar requirement is or shall be imposed or modified in respect of any Letter of Credit issued or caused to be issued hereunder or hereby, or
 
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(ii) there shall be imposed on Issuing Bank or any other member of the Lender Group any other condition regarding any Letter of Credit,
and the result of the foregoing is to increase, directly or indirectly, the cost to Issuing Bank or any other member of the Lender Group of issuing, making, participating in, or maintaining any Letter of Credit or to reduce the amount receivable in respect thereof, then, and in any such case, Administrative Agent may, at any time within a reasonable period after the additional cost is incurred or the amount received is reduced, notify Borrowers, and Borrowers shall pay within 30 days after demand therefor, such amounts as Administrative Agent may specify to be necessary to compensate Issuing Bank or any other member of the Lender Group for such additional cost or reduced receipt, together with interest on such amount from the date of such demand until payment in full thereof at the rate then applicable to Base Rate Loans hereunder; provided , that (A) Borrowers shall not be required to provide any compensation pursuant to this Section 2.11(l) for any such amounts incurred more than 180 days prior to the date on which the demand for payment of such amounts is first made to Borrowers, and (B) if an event or circumstance giving rise to such amounts is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof. The determination by Administrative Agent of any amount due pursuant to this Section 2.11(l) , as set forth in a certificate setting forth the calculation thereof in reasonable detail, shall, in the absence of manifest or demonstrable error, be final and conclusive and binding on all of the parties hereto.
(m) Unless otherwise expressly agreed by Issuing Bank and Borrowers when a Letter of Credit is issued (including any such agreement applicable to an Existing Letter of Credit), (i) the rules of the ISP and the UCP shall apply to each standby Letter of Credit, and (ii) the rules of the UCP shall apply to each commercial Letter of Credit.
(n) In the event of a direct conflict between the provisions of this Section 2.11 and any provision contained in any Issuer Document, it is the intention of the parties hereto that such provisions be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this Section 2.11 shall control and govern.
2.12 LIBOR Option .
(a) Interest and Interest Payment Dates . In lieu of having interest charged at the rate based upon the Base Rate, Borrowers shall have the option, subject to Section 2.12(b) below (the “ LIBOR Option ”) to have interest on all or a portion of the Revolving Loans be charged (whether at the time when made (unless otherwise provided herein), upon conversion from a Base Rate Loan to a LIBOR Rate Loan, or upon continuation of a LIBOR Rate Loan as a LIBOR Rate Loan) at a rate of interest based upon the LIBOR Rate. Interest on LIBOR Rate Loans shall be payable on the earliest of (i) the last day of the Interest Period applicable thereto; provided , that, subject to the following clauses (ii) and (iii) , in the case of any Interest Period greater than 3 months in duration, interest shall be payable at 3-month intervals after the commencement of the applicable Interest Period and on the last day of such Interest Period), (ii) the date on which all or any portion of the Obligations are accelerated pursuant to the terms hereof, or (iii) the date on which this Agreement is terminated pursuant to the terms hereof. On the last
 
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day of each applicable Interest Period, unless Borrowers have properly exercised the LIBOR Option with respect thereto, the interest rate applicable to such LIBOR Rate Loan automatically shall convert to the rate of interest then applicable to Base Rate Loans of the same type hereunder. At any time that an Event of Default has occurred and is continuing, at the written election of the Required Lenders, Borrowers no longer shall have the option to request that Revolving Loans bear interest at a rate based upon the LIBOR Rate.
(b) LIBOR Election .
(i) Borrowers may, at any time and from time to time, so long as Borrowers have not received a notice from Administrative Agent (which notice Administrative Agent may elect to give or not give in its discretion unless Administrative Agent is directed to give such notice by the Required Lenders, in which case, it shall give the notice to Borrowers), after the occurrence and during the continuance of an Event of Default, to terminate the right of Borrowers to exercise the LIBOR Option during the continuance of such Event of Default, elect to exercise the LIBOR Option by notifying Administrative Agent prior to noon at least 3 Business Days prior to the commencement of the proposed Interest Period (the “ LIBOR Deadline ”); provided , that Administrative Agent may, in its sole discretion, elect to accept as timely exercises of the LIBOR Option that are received later than noon on the applicable Business Day. Notice of Borrowers’ election of the LIBOR Option for a permitted portion of the Revolving Loans and an Interest Period pursuant to this Section shall be made by delivery to Administrative Agent of a LIBOR Notice received by Administrative Agent before the LIBOR Deadline, or by telephonic notice received by Administrative Agent before the LIBOR Deadline (to be confirmed by delivery to Administrative Agent of a LIBOR Notice received by Administrative Agent prior to 5:00 p.m. on the same day). Promptly upon its receipt of each such LIBOR Notice, Administrative Agent shall provide a copy thereof to each of the affected Lenders.
(ii) Each LIBOR Notice shall be irrevocable and binding on Borrowers. In connection with each LIBOR Rate Loan, each Borrower shall indemnify, defend, and hold Administrative Agent and the Lenders harmless against any loss, cost, or expense actually incurred by Administrative Agent or any Lender as a result of (A) the payment of any principal of any LIBOR Rate Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (B) the conversion of any LIBOR Rate Loan other than on the last day of the Interest Period applicable thereto, or (C) the failure to borrow, convert, or continue any LIBOR Rate Loan on the date specified in any LIBOR Notice delivered pursuant hereto (such losses, costs, or expenses, “ Funding Losses ”). A certificate of Administrative Agent or a Lender delivered to Borrowers setting forth in reasonable detail any amount or amounts that Administrative Agent or such Lender is entitled to receive pursuant to this Section 2.12 shall be conclusive absent manifest error. Borrowers shall pay such amount to Administrative Agent or the Lender, as applicable, within 30 days of the date of its receipt of such certificate. If a payment of a LIBOR Rate Loan on a day other than the last day of the applicable Interest Period would result in a Funding Loss, Administrative Agent may, in its sole discretion at the request of Borrowers, hold the amount of such payment as cash collateral in support of the Obligations until the last day of such Interest Period and apply such amounts to the payment of the applicable LIBOR Rate Loan on such last day, it being agreed that Administrative Agent has no obligation to so defer the application of payments to any LIBOR Rate Loan and that, in the event that Administrative Agent does not defer such application, Borrowers shall be obligated to pay any resulting Funding Losses.
 
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(iii) Unless Administrative Agent, in its sole discretion, agrees otherwise, Borrowers shall have not more than 8 LIBOR Rate Loans in effect at any given time. Borrowers may only exercise the LIBOR Option for proposed LIBOR Rate Loans of at least $1,000,000.
(c) Conversion . Borrowers may convert LIBOR Rate Loans to Base Rate Loans at any time; provided , that in the event that LIBOR Rate Loans are converted or prepaid on any date that is not the last day of the Interest Period applicable thereto, including as a result of any prepayment through the required application by Administrative Agent of any payments or proceeds of Collateral in accordance with Section 2.4(b) or for any other reason, including early termination of the term of this Agreement or acceleration of all or any portion of the Obligations pursuant to the terms hereof, each Borrower shall indemnify, defend, and hold Administrative Agent and the Lenders and their Participants harmless against any and all Funding Losses in accordance with Section 2.12(b)(ii) .
(d) Special Provisions Applicable to LIBOR Rate .
(i) The LIBOR Rate may be adjusted by Administrative Agent with respect to any Lender on a prospective basis to take into account any additional or increased costs to such Lender of maintaining or obtaining any eurodollar deposits or increased costs, in each case, due to changes in applicable law occurring subsequent to the commencement of the then applicable Interest Period, including any Changes in Law (including any changes in tax laws (except changes of general applicability in corporate income tax laws)) and changes in the reserve requirements imposed by the Board of Governors, which additional or increased costs would increase the cost of funding or maintaining loans bearing interest at the LIBOR Rate. In any such event, the affected Lender shall give Borrowers and Administrative Agent notice of such a determination and adjustment and Administrative Agent promptly shall transmit the notice to each other Lender and, upon its receipt of the notice from the affected Lender, Borrowers may, by notice to such affected Lender (A) require such Lender to furnish to Borrowers a statement setting forth in reasonable detail the basis for adjusting such LIBOR Rate and the method for determining the amount of such adjustment, or (B) repay the LIBOR Rate Loans of such Lender with respect to which such adjustment is made (together with any amounts due under Section 2.12(b)(ii) ).
(ii) In the event that any change in market conditions or any Change in Law shall at any time after the date hereof, in the reasonable opinion of any Lender, make it unlawful or impractical for such Lender to fund or maintain LIBOR Rate Loans or to continue such funding or maintaining, or to determine or charge interest rates at the LIBOR Rate, such Lender shall give notice of such changed circumstances to Administrative Agent and Borrowers and Administrative Agent promptly shall transmit the notice to each other Lender and (y) in the case of any LIBOR Rate Loans of such Lender that are outstanding, the date specified in such Lender’s notice shall be deemed to be the last day of the Interest Period of such LIBOR Rate Loans, and interest upon the LIBOR Rate Loans of such Lender thereafter shall accrue interest at the rate then applicable to Base Rate Loans, and (z) Borrowers shall not be entitled to elect the LIBOR Option until such Lender determines that it would no longer be unlawful or impractical to do so.
(e) No Requirement of Matched Funding . Anything to the contrary contained herein notwithstanding, neither Administrative Agent, nor any Lender, nor any of their Participants, is required actually to acquire eurodollar deposits to fund or otherwise match fund any Obligation as to which interest accrues at the LIBOR Rate.
 
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2.13 Capital Requirements .
(a) If, after the date hereof, Issuing Bank or any Lender determines that (i) any Change in Law regarding capital, liquidity, or reserve requirements for banks or bank holding companies, or (ii) compliance by Issuing Bank or such Lender, or their respective parent bank holding companies, with any guideline, request or directive of any Governmental Authority regarding capital adequacy (whether or not having the force of law), has the effect of reducing the return on Issuing Bank’s, such Lender’s, or such holding companies’ capital as a consequence of Issuing Bank’s or such Lender’s commitments hereunder to a level below that which Issuing Bank, such Lender, or such holding companies could have achieved but for such Change in Law or compliance (taking into consideration Issuing Bank’s, such Lender’s, or such holding companies’ then existing policies with respect to capital adequacy and assuming the full utilization of such entity’s capital) by any amount deemed by Issuing Bank or such Lender to be material, then Issuing Bank or such Lender may notify Borrowers and Administrative Agent thereof. Following receipt of such notice, Borrowers agree to pay Issuing Bank or such Lender on demand the amount of such reduction of return of capital as and when such reduction is determined, payable within 30 days after presentation by Issuing Bank or such Lender of a statement in the amount and setting forth in reasonable detail Issuing Bank’s or such Lender’s calculation thereof and the assumptions upon which such calculation was based (which statement shall be deemed true and correct absent manifest error). In determining such amount, Issuing Bank or such Lender may use any reasonable averaging and attribution methods. Failure or delay on the part of Issuing Bank or any Lender to demand compensation pursuant to this Section shall not constitute a waiver of Issuing Bank’s or such Lender’s right to demand such compensation; provided that Borrowers shall not be required to compensate Issuing Bank or a Lender pursuant to this Section for any reductions in return incurred more than 180 days prior to the date that Issuing Bank or such Lender notifies Borrowers of such Change in Law giving rise to such reductions and of such Lender’s intention to claim compensation therefor; provided further that if such claim arises by reason of the Change in Law that is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.
(b) If Issuing Bank or any Lender requests additional or increased costs referred to in Section 2.11(l) or Section 2.12(d)(i) or amounts under Section 2.13(a) or sends a notice under Section 2.12(d)(ii) relative to changed circumstances (such Issuing Bank or Lender, an “ Affected Lender ”), then such Affected Lender shall use reasonable efforts to promptly designate a different one of its lending offices or to assign its rights and obligations hereunder to another of its offices or branches, if (i) in the reasonable judgment of such Affected Lender, such designation or assignment would eliminate or reduce amounts payable pursuant to Section 2.11(l) , Section 2.12(d)(i), or Section 2.13(a) , as applicable, or would eliminate the illegality or impracticality of funding or maintaining LIBOR Rate Loans and (ii) in the reasonable judgment of such Affected Lender, such designation or assignment would not subject it to any material unreimbursed cost or expense and would not otherwise be materially disadvantageous to it. Borrowers agree to pay all reasonable out-of-pocket costs and expenses incurred by such Affected Lender in connection with any such designation or assignment. If, after such reasonable efforts, such Affected Lender does not so designate a different one of its lending offices or assign its rights to another of its offices or branches so as to eliminate Borrowers’ obligation to pay any future amounts to such Affected Lender pursuant to Section 2.11(l) , Section 2.12(d)(i) , or Section 2.13(a) , as applicable, or to enable Borrowers to obtain LIBOR Rate Loans, then Borrowers (without prejudice to any amounts then due to such Affected Lender under Section 2.11(l) , Section 2.12(d)(i) , or Section 2.13(a) , as applicable) may, unless prior to the effective date of any such assignment the Affected
 
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Lender withdraws its request for such additional amounts under Section 2.11(l) , Section 2.12(d)(i) , or Section 2.13(a) , as applicable, or indicates that it is no longer unlawful or impractical to fund or maintain LIBOR Rate Loans, may designate a different Issuing Bank or substitute a Lender, in each case, reasonably acceptable to Administrative Agent to purchase the Obligations owed to such Affected Lender and such Affected Lender’s commitments hereunder (a “ Replacement Lender ”), and if such Replacement Lender agrees to such purchase, such Affected Lender shall assign to the Replacement Lender its Obligations and commitments, and upon such purchase by the Replacement Lender, which such Replacement Lender shall be deemed to be “Issuing Bank” or a “Lender” (as the case may be) for purposes of this Agreement and such Affected Lender shall cease to be “Issuing Bank” or a “Lender” (as the case may be) for purposes of this Agreement.
(c) Notwithstanding anything herein to the contrary, the protection of Sections 2.11(l) , 2.12(d) , and 2.13 shall be available to Issuing Bank and each Lender (as applicable) regardless of any possible contention of the invalidity or inapplicability of the law, rule, regulation, judicial ruling, judgment, guideline, treaty or other change or condition which shall have occurred or been imposed, so long as it shall be customary for issuing banks or lenders affected thereby to comply therewith. Notwithstanding any other provision herein, neither Issuing Bank nor any Lender shall demand compensation pursuant to this Section 2.13 if it shall not at the time be the general policy or practice of Issuing Bank or such Lender (as the case may be) to demand such compensation in similar circumstances under comparable provisions of other credit agreements, if any.
2.14 [Reserved].
2.15 Joint and Several Liability of Borrowers .
(a) Each Borrower is accepting joint and several liability hereunder and under the other Loan Documents in consideration of the financial accommodations to be provided by the Lender Group under this Agreement, for the mutual benefit, directly and indirectly, of each Borrower and in consideration of the undertakings of the other Borrowers to accept joint and several liability for the Obligations.
(b) Each Borrower, jointly and severally, hereby irrevocably and unconditionally accepts, not merely as a surety but also as a co-debtor, joint and several liability with the other Borrowers, with respect to the payment and performance of all of the Obligations (including any Obligations arising under this Section 2.15 ), it being the intention of the parties hereto that all the Obligations shall be the joint and several obligations of each Borrower without preferences or distinction among them.
(c) If and to the extent that any Borrower shall fail to make any payment with respect to any of the Obligations as and when due or to perform any of the Obligations in accordance with the terms thereof, then in each such event the other Borrowers will make such payment with respect to, or perform, such Obligation until such time as all of the Obligations are paid in full.
(d) The Obligations of each Borrower under the provisions of this Section 2.15 constitute the absolute and unconditional, full recourse Obligations of each Borrower enforceable against each Borrower to the full extent of its properties and assets, irrespective of the validity, regularity or enforceability of the provisions of this Agreement (other than this Section 2.15(d) ) or any other circumstances whatsoever.
 
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(e) Except as otherwise expressly provided in this Agreement, each Borrower hereby waives notice of acceptance of its joint and several liability, notice of any Revolving Loans or Letters of Credit issued under or pursuant to this Agreement, notice of the occurrence of any Default, Event of Default, or of any demand for any payment under this Agreement, notice of any action at any time taken or omitted by Administrative Agent or Lenders under or in respect of any of the Obligations, any requirement of diligence or to mitigate damages and, generally, to the extent permitted by applicable law, all demands, notices and other formalities of every kind in connection with this Agreement (except as otherwise provided in this Agreement). Each Borrower hereby assents to, and waives notice of, any extension or postponement of the time for the payment of any of the Obligations, the acceptance of any payment of any of the Obligations, the acceptance of any partial payment thereon, any waiver, consent or other action or acquiescence by Administrative Agent or Lenders at any time or times in respect of any default by any Borrower in the performance or satisfaction of any term, covenant, condition or provision of this Agreement, any and all other indulgences whatsoever by Administrative Agent or Lenders in respect of any of the Obligations, and the taking, addition, substitution or release, in whole or in part, at any time or times, of any security for any of the Obligations or the addition, substitution or release, in whole or in part, of any Borrower. Without limiting the generality of the foregoing, each Borrower assents to any other action or delay in acting or failure to act on the part of any Administrative Agent or Lender with respect to the failure by any Borrower to comply with any of its respective Obligations, including, without limitation, any failure strictly or diligently to assert any right or to pursue any remedy or to comply fully with applicable laws or regulations thereunder, which might, but for the provisions of this Section 2.15 afford grounds for terminating, discharging or relieving any Borrower, in whole or in part, from any of its Obligations under this Section 2.15 , it being the intention of each Borrower that, so long as any of the Obligations hereunder remain unsatisfied, the Obligations of each Borrower under this Section 2.15 shall not be discharged except by performance and then only to the extent of such performance. The Obligations of each Borrower under this Section 2.15 shall not be diminished or rendered unenforceable by any winding up, reorganization, arrangement, liquidation, reconstruction or similar proceeding with respect to any other Borrower or any Administrative Agent or Lender.
(f) Each Borrower represents and warrants to Administrative Agent and Lenders that such Borrower is currently informed of the financial condition of Borrowers and of all other circumstances that a diligent inquiry would reveal and which bear upon the risk of nonpayment of the Obligations. Each Borrower further represents and warrants to Administrative Agent and Lenders that such Borrower has read and understands the terms and conditions of the Loan Documents. Each Borrower hereby covenants that such Borrower will continue to keep informed of Borrowers’ financial condition and of all other circumstances that bear upon the risk of nonpayment or nonperformance of the Obligations.
(g) The provisions of this Section 2.15 are made for the benefit of Administrative Agent, each member of the Lender Group, each Bank Product Provider, and their respective successors and assigns, and may be enforced by it or them from time to time against any or all Borrowers as often as occasion therefor may arise and without requirement on the part of Administrative Agent, any member of the Lender Group, any Bank Product Provider, or any of their successors or assigns first to marshal any of its or their claims or to exercise any of its or their rights against any Borrower or to exhaust any remedies available to it or them against any Borrower or to resort to any other source or means of obtaining payment of any of the Obligations hereunder or to elect any other remedy. The provisions of this Section 2.15 shall remain in effect until all of the Obligations shall have been paid in full or otherwise
 
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fully satisfied. If at any time, any payment, or any part thereof, made in respect of any of the Obligations, is rescinded or must otherwise be restored or returned by Administrative Agent or any Lender upon the insolvency, bankruptcy or reorganization of any Borrower, or otherwise, the provisions of this Section 2.15 will forthwith be reinstated in effect, as though such payment had not been made.
(h) Each Borrower hereby agrees that it will not enforce any of its rights of contribution or subrogation against any other Borrower with respect to any liability incurred by it hereunder or under any of the other Loan Documents, any payments made by it to Administrative Agent or Lenders with respect to any of the Obligations or any collateral security therefor until such time as all of the Obligations have been paid in full in cash. Any claim which any Borrower may have against any other Borrower with respect to any payments to any Administrative Agent or any member of the Lender Group hereunder or under any of the Bank Product Agreements are hereby expressly made subordinate and junior in right of payment, without limitation as to any increases in the Obligations arising hereunder or thereunder, to the prior payment in full in cash of the Obligations and, in the event of any insolvency, bankruptcy, receivership, liquidation, reorganization or other similar proceeding under the laws of any jurisdiction relating to any Borrower, its debts or its assets, whether voluntary or involuntary, all such Obligations shall be paid in full in cash before any payment or distribution of any character, whether in cash, securities or other property, shall be made to any other Borrower therefor.
(i) Each Borrower hereby agrees that after the occurrence and during the continuance of any Default or Event of Default, such Borrower will not demand, sue for or otherwise attempt to collect any indebtedness of any other Borrower owing to such Borrower until the Obligations shall have been paid in full in cash. If, notwithstanding the foregoing sentence, such Borrower shall collect, enforce or receive any amounts in respect of such indebtedness, such amounts shall be collected, enforced and received by such Borrower as trustee for Administrative Agent, and such Borrower shall deliver any such amounts to Administrative Agent for application to the Obligations in accordance with Section 2.4(b) .
3. CONDITIONS; TERM OF AGREEMENT .
3.1 Conditions Precedent to Closing Date . The obligations of the Lenders to make Loans and of each Issuing Bank to issue Letters of Credit hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 14.1 ):
(a) Credit Agreement and Other Loan Documents . Administrative Agent (or its counsel) shall have received (i) from each party hereto either (A) a counterpart of this Agreement signed on behalf of such party or (B) written evidence satisfactory to Administrative Agent (which may include facsimile or other electronic transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement, (ii) either (A) a counterpart of each other Loan Document signed on behalf of each party thereto or (B) written evidence satisfactory to Administrative Agent (which may include facsimile or other electronic transmission of a signed signature page thereof) that each such party has signed a counterpart of such Loan Document, (iii) a completed Perfection Certificate for Anixter and its applicable Subsidiaries, and (iv) such other certificates, documents, instruments and agreements as Administrative Agent shall reasonably request in connection with the transactions contemplated by this Agreement and the other Loan Documents, including any promissory notes requested by a Lender pursuant to Section 2.5(b) payable to the order of each such requesting Lender and a written opinion of the Loan Parties’ counsel, addressed to Administrative Agent, each Issuing Bank, and the Lenders, all in form and substance satisfactory to Administrative Agent and its counsel.
 
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(b) Financial Statements and Projections .
(i) The Lenders shall have received a pro forma consolidated balance sheet, income statement and cash flow statement (“ Pro Forma Opening Statements ”) giving effect to the HD Supply Acquisition, together with such information as the Lenders may reasonably request to confirm the tax, legal, and business assumptions made in such Pro Forma Opening Statements.
(ii) The Lenders shall have received (A) unaudited interim consolidated financial statements of Anixter for each fiscal quarter ended subsequent to March 31, 2015, and such financial statements shall not, in the reasonable judgment of Administrative Agent, reflect any material adverse change in the consolidated financial condition of Anixter, as reflected in the audited, consolidated financial statements of the last fiscal year of Anixter, and (B) satisfactory projections beginning July 1, 2015, and ending December 31, 2016, on a quarterly basis.
(c) Officer Certificates; Certified Certificate of Incorporation; Good Standing Certificates . Administrative Agent shall have received (i) a certificate of each Loan Party, dated the Closing Date and executed by its secretary, assistant secretary, or other similar officer, which shall (A) certify the resolutions of its Board of Directors, members or other body authorizing the execution, delivery and performance of the Loan Documents to which it is a party, (B) identify by name and title and bear the signatures of the officers of such Loan Party authorized to sign the Loan Documents to which it is a party and, in the case of the Anixter and each other Borrower, its Financial Officers, and (C) contain appropriate attachments, including the certificate or articles of incorporation or organization of such Loan Party certified by the relevant authority of the jurisdiction of organization of such Loan Party and a true and correct copy of its by-laws or operating, management or partnership agreement, or other organizational or governing documents, and (ii) a good standing certificate for each Loan Party from its jurisdiction of organization or the substantive equivalent available in the jurisdiction of organization for such Loan Party from the appropriate governmental officer in such jurisdiction.
(d) Closing Certificate . Administrative Agent shall have received a certificate, signed by a Financial Officer of Anixter, dated as of the Closing Date stating that upon giving effect to the initial extension of credit under this Agreement (i) no Default has occurred and is continuing, (ii) each of the Specified Representations are true and correct as of such date, and (iii) certifying that each of the conditions set forth this Section 3.1 have been (or substantially simultaneously with the closing of the Transactions, will be) satisfied.
(e) Fees . The Lenders and Administrative Agent shall have received all fees required to be paid, and all expenses for which invoices have been presented (including the reasonable fees and expenses of legal counsel), on or before the Closing Date. All such amounts will be paid with proceeds of Loans made on the Closing Date and will be reflected in the funding instructions given by the Borrowers to Administrative Agent on or before the Closing Date.
(f) Lien Searches . Administrative Agent shall have received the results of a recent lien search in the jurisdiction where each Loan Party is organized and such search shall reveal no Liens on any of the assets of any Loan Party or any assets being transferred to any Loan Party except for Liens
 
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permitted by Section 6.2 and under the Receivables Facility Transaction Documents, as applicable, or discharged on or prior to the Closing Date pursuant to a pay-off letter or other documentation satisfactory to Administrative Agent.
(g) Pay-Off Letter . Administrative Agent shall have received satisfactory pay-off letters for all existing Indebtedness (including Indebtedness (i) under a Second Amendment and Incremental Facility Agreement, dated as of August 27, 2014, by and among Anixter, certain subsidiaries of Anixter, the guarantors party thereto, and Wells Fargo, as administrative agent, and (ii) under the 2011 Receivables Purchase Agreement to be repaid from the proceeds of the initial Loans, confirming that all Liens upon any of the property of the Loan Parties constituting Collateral will be terminated concurrently with such payment and all letters of credit issued or guaranteed as part of such Indebtedness shall have been cash collateralized or supported by a Letter of Credit.
(h) [Reserved].
(i) [Reserved].
(j) Solvency . Administrative Agent shall have received a solvency certificate signed by a Financial Officer of Anixter dated the Closing Date.
(k) Borrowing Base Certificate . Administrative Agent shall have received a Borrowing Base Certificate which calculates the Borrowing Base (on a pro forma basis after giving effect to the HD Supply Acquisition) as of the end of the Fiscal Month immediately preceding the Closing Date and includes customary supporting documentation and supplemental reporting satisfactory to Administrative Agent.
(l) Closing Combined Availability . After giving effect to all Borrowings to be made on the Closing Date, the issuance of any Letters of Credit on the Closing Date, and the payment of all fees and expenses due hereunder, and with all of the Loan Parties’ indebtedness, liabilities, and obligations current, Combined Availability shall not be less than $250,000,000.
(m) Filings, Registrations and Recordings . Each document (including any Uniform Commercial Code financing statement) required by the Collateral Documents or under law or reasonably requested by Administrative Agent to be filed, registered or recorded in order to create in favor of Administrative Agent, for the benefit of itself and the Lenders, a perfected Lien on the Collateral described therein, prior and superior in right to any other Person (other than with respect to Liens expressly permitted by Section 6.2 ), shall be in proper form for filing, registration or recordation; provided that notwithstanding the foregoing, to the extent any Collateral is not provided on the Closing Date after the Loan Parties’ use of commercially reasonable efforts to do so (other than (i) the filing of UCC financing statements, (ii) the filing of intellectual property security agreements for intellectual property that is registered as of the Closing Date, and (iii) the delivery of stock certificates), the providing of such Collateral shall not be required as a condition to the closing hereunder.
(n) HD Supply Acquisition . Administrative Agent shall be satisfied with the HD Supply Acquisition Documents (it being acknowledged that Administrative Agent is satisfied with the HD Supply Purchase Documents provided on or prior to July 22, 2015) and shall have received a true, correct and complete copy of the same. None of the Targets nor the HD Supply Sellers have (i) announced that it will oppose the HD Supply Acquisition or (ii) commenced any action which alleges
 
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that the HD Supply Acquisition will violate applicable law. No injunction or temporary restraining order shall exist which, in the judgment of the applicable Administrative Agent, would prohibit the making of the Loans or the consummation of the HD Supply Acquisition. Administrative Agent shall have received evidence that each of the items described in Section 2.8 of the HD Supply Acquisition Agreement will be delivered, each of the conditions precedent set forth in Sections 7.1 and 7.2 of the HD Supply Acquisition Agreement will be satisfied (or, with the written approval of Administrative Agent, waived) and the HD Supply Acquisition will be consummated, in each case, substantially simultaneously with the closing of the Transactions contemplated hereunder and no other provision of the HD Supply Acquisition Documents shall have been waived, amended, supplemented, or otherwise modified in any material and adverse respect without approval of Administrative Agent.
(o) Receivables Facility . Administrative Agent shall have received evidence that the Receivables Facility has closed (or will be closing substantially concurrently with the closing hereunder) on terms and conditions reasonably satisfactory to Administrative Agent.
(p) Issuance of Senior Notes . Anixter shall have issued up to $500,000,000 of new senior unsecured notes for the purpose of financing a portion of the purchase price of the HD Supply Acquisition, on terms and conditions reasonably satisfactory to Administrative Agent.
(q) Insurance . Administrative Agent shall have received evidence of insurance coverage in form, scope, and substance reasonably satisfactory to Administrative Agent and otherwise in compliance with the terms of Section 5.10 .
(r) Compliance with Regulations . This Agreement and the other Loan Documents shall not violate applicable requirements of Regulations T, U, and X.
(s) Letter of Credit Application . If a Letter of Credit (other than the Existing Letters of Credit) is requested to be issued on the Closing Date, Administrative Agent shall have received a properly completed letter of credit application (whether standalone or pursuant to a master agreement, as applicable).
(t) Field Examination; Inventory Appraisal .
(i) Administrative Agent or its designee shall have conducted a field examination of the accounts receivable and related working capital matters and financial information of the Targets and of the related data-processing and other systems, the results of which shall be satisfactory to Administrative Agent in its sole discretion.
(ii) Administrative Agent shall have received an appraisal of the Net Recovery Percentage applicable to Borrower’s and its Subsidiaries’ (other than Targets’) Inventory, the results of which shall be satisfactory to Administrative Agent in its sole discretion.
(u) Legal Due Diligence . Administrative Agent and its counsel shall have completed all legal due diligence, the results of which shall be satisfactory to Administrative Agent in its sole discretion.
(v) Patriot Act, etc . Administrative Agent and the Lenders shall have received all documentation and other information as is reasonably requested by Administrative Agent as least five (5) business days before the Closing Date under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act, for each Loan Party.
 
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(w) Anixter Canada Loan . Anixter Canada shall have borrowed (or will be borrowing substantially concurrently with the closing hereunder) a term loan in an original principal amount of up to CAD 300,000,000 for the purpose of financing a portion of the purchase price of the HD Supply Acquisition, on terms and conditions reasonably satisfactory to Administrative Agent.
(x) AXE . Administrative Agent shall have received all documentation and information as is reasonably requested at least five (5) Business Days before the Closing Date about AXE, its Subsidiaries, and each Target mutually agreed to be required by U.S. regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.
(y) Receivables Facility Transaction Documents . Administrative Agent shall have received a true, correct and complete copy of the Receivables Facility Transaction Documents, each in form and substance reasonably satisfactory to Administrative Agent.
(z) Termination of Existing Receivables Arrangements . Administrative Agent shall have received satisfactory evidence of the termination of each existing arrangement under which Accounts of any Originator have been or are transferred to any entity (including any affiliate of Anixter) other than ARC (including the 2011 Receivables Purchase Agreement); and release or transfer, as applicable, of all liens, if any, granted under each such existing arrangement; and return transfer to ARC by each such ultimate transferee and any intermediate transferee under any such existing arrangement of all accounts receivable of Anixter or such Originator transferred to such transferee thereunder.
(aa) Other Debt Instruments . The material debt instruments and governing documents of the Loan Parties after the HD Supply Acquisition shall be reasonably acceptable to Administrative Agent.
(bb) Other Events . There has not occurred any event, development, or circumstances that has had or could reasonably be expected to have a material adverse effect on the business, operations, property, or condition (financial or otherwise) of any Borrower or Anixter and its Subsidiaries, taken as a whole.
(cc) No Material Adverse Effect . Since February 1, 2015, no “Material Adverse Effect” under and as defined in the HD Supply Acquisition Agreement has occurred.
(dd) Other Documents . Administrative Agent shall have received such other documents as Administrative Agent, any Issuing Bank, any Lender, or their respective counsel may have reasonably requested.
3.2 Conditions Precedent to all Extensions of Credit . The obligation of the Lender Group (or any member thereof) to make any Revolving Loans hereunder (or to extend any other credit hereunder) at any time shall be subject to the following conditions precedent:
(a) (i) as of the Closing Date, each of the HD Supply Acquisition Agreement Representations and the Specified Representations shall be true, correct, and complete, in all material
 
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respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof); and (ii) at and as of the date of each extension of credit made after the Closing Date, each of the representations and warranties of each Borrower or its Subsidiaries contained in this Agreement or in the other Loan Documents shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date of such extension of credit, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of such earlier date);
(b) (i) as of the Closing Date, no Default or Event of Default (other than an Event of Default described in clause (c) of Section 8 (or a related Default) not in respect of the Specified Representations or the “Specified Representations” under and as defined in the Receivables Facility Credit Agreement) shall have occurred and be continuing, nor shall either result from the making of any extension of credit to be made on the Closing Date; and (ii) at and as of the date of each extension of credit made after the Closing Date, no Default or Event of Default shall have occurred and be continuing on the date of such extension of credit, nor shall either result from the making thereof; and
(c) Administrative Agent shall have received (including, without limitation or duplication, pursuant to Section 5.1(f) ) a Borrowing Base Certificate which calculates the Borrowing Base as of the end of the Fiscal Month most recently ended before the requested Funding Date (or, if an Enhanced Reporting Trigger Period is then in effect, as of the end of the week most recently ended before the requested Funding Date).
3.3 Maturity . This Agreement shall continue in full force and effect for a term ending on the Maturity Date.
3.4 Effect of Maturity . On the Maturity Date, all commitments of the Lender Group to provide additional credit hereunder shall automatically be terminated and all of the Obligations immediately shall become due and payable without notice or demand and Borrowers shall be required to repay all of the Obligations in full. No termination of the obligations of the Lender Group (other than payment in full of the Obligations and termination of the Commitments) shall relieve or discharge any Loan Party of its duties, obligations, or covenants hereunder or under any other Loan Document and Administrative Agent’s Liens in the Collateral shall continue to secure the Obligations and shall remain in effect until all Obligations have been paid in full and the Commitments have been terminated. When all of the Obligations have been paid in full and the Lender Group’s obligations to provide additional credit under the Loan Documents have been terminated irrevocably, Administrative Agent will, at Borrowers’ sole expense, execute and deliver any termination statements, lien releases, discharges of security interests, and other similar discharge or release documents (and, if applicable, in recordable form) as are reasonably necessary to release, as of record, Administrative Agent’s Liens and all notices of security interests and liens previously filed by Administrative Agent.
3.5 Early Termination by Borrowers . Borrowers have the option, at any time upon 10 Business Days prior written notice to Administrative Agent, to terminate this Agreement and terminate the Commitments hereunder by repaying to Administrative Agent all of the Obligations in full. The foregoing
 
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notwithstanding, (a) Borrowers may rescind termination notices relative to proposed payments in full of the Obligations with the proceeds of third-party Indebtedness if the closing for such issuance or incurrence does not happen on or before the date of the proposed termination (in which case, a new notice shall be required to be sent in connection with any subsequent termination), and (b) Borrowers may extend the date of termination at any time with the consent of Administrative Agent (which consent shall not be unreasonably withheld or delayed).
4. REPRESENTATIONS AND WARRANTIES .
In order to induce the Lender Group to enter into this Agreement, each Borrower makes the following representations and warranties to the Lender Group which shall be true, correct, and complete, in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the Closing Date, and shall be true, correct, and complete, in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the date of the making of each Revolving Loan (or other extension of credit) made thereafter, as though made on and as of the date of such Revolving Loan (or other extension of credit) (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of such earlier date) and such representations and warranties shall survive the execution and delivery of this Agreement:
4.1 Organization; Powers . Each of AXE, Anixter, and the Subsidiaries of Anixter is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization; has all requisite power and authority to own, operate, and encumber its property and assets to carry on its business as now conducted and proposed to be conducted in connection with and following the consummation of the Related Transactions; and, except where the failure to do so, individually or in the aggregate, has not resulted in and could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business, and is in good standing, in every jurisdiction where it owns or leases real property or where such qualification is required.
4.2 Authorization; Enforceability . Each of AXE, Anixter, and the Subsidiaries of Anixter party to any of the Related Transactions Documents has the requisite organizational power and authority to execute, deliver, and perform its obligations under each of the Related Transactions Documents executed by it or to be executed by it. The execution, delivery, and performance (or filing or recording, as the case may be) by AXE, Anixter, and each Subsidiary of Anixter of each Related Transactions Document to which such Person is a party and the consummation of the transactions contemplated thereby have been duly authorized by all necessary organizational actions and no other organizational proceedings on the part of any such Person are necessary to consummate the such transactions. Each Related Transactions Document to which AXE, Anixter, or a Subsidiary of Anixter is a party has been duly executed and delivered by such Person and constitutes a legal, valid, and binding obligation of such Person, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
 
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4.3 Governmental Approvals; No Conflicts . The execution, delivery, and performance by each of AXE, Anixter, and each Subsidiary of Anixter of each Related Transactions Document to which it is party and each of the transactions contemplated thereby, do not and will not (a) except for any filings to perfect the security interests granted pursuant to the Loan Documents, require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, (b) conflict with or violate such Person’s Organization Documents, (c) except as set forth on Schedule 4.3 , conflict with, result in a breach of, or constitute (with or without notice or lapse of time or both) a default under any Requirement of Law or Contractual Obligation of any such Person, or require termination of any Contractual Obligation of any such Person, in each case, which could reasonably be expected to have a Material Adverse Effect, (d) conflict with any Contractual Obligation of any such Person, any liability resulting from which has resulted in or could be reasonably expected to result in a Material Adverse Effect, (e) result in or require the creation or imposition of any Lien on any asset of any such Person, except Liens permitted by Section 6.2 , or (f) require any approval of stockholders of any such Person, unless such approval has been obtained.
4.4 Financial Condition; No Material Adverse Change .
(a) As of the Closing Date, all quarterly and annual financial statements of Anixter or of Anixter and any of its Subsidiaries delivered to Administrative Agent and the Lenders were prepared in conformity with GAAP (except as otherwise noted therein) and fairly present in all material respects the financial position of Anixter or the consolidated financial position of Anixter and such Subsidiaries, as the case may be, as at the respective dates thereof and the results of operations and changes in cash flows for each of the periods covered thereby, subject, in the case of any unaudited interim financial statements, to changes resulting from audit and normal year-end adjustments.
(b) All quarterly and annual financial statements of Anixter or of Anixter and any of its Subsidiaries delivered to Administrative Agent on or prior to the date this representation is made or deemed made were prepared in conformity with GAAP (except as otherwise noted therein) and fairly present in all material respects the financial position of Anixter or the consolidated financial position of Anixter and such Subsidiaries, as the case may be, as at the respective dates thereof and the results of operations and changes in cash flows for each of the periods covered thereby, subject, in the case of any unaudited interim financial statements, to changes resulting from audit and normal year-end adjustments.
(c) With respect to each of AXE, Anixter, and Anixter and its Subsidiaries taken as a whole, no event has occurred since the Friday closest to December 31, 2014, that has resulted in or could reasonably be expected to result in a Material Adverse Effect.
4.5 Properties .
(a) As of the date of this Agreement, Schedule 4.5 sets forth the address of each parcel of real property that is owned or leased by Anixter or any of its Subsidiaries and that (i) is a chief executive office of such Person, (ii) maintains such Person’s books and records, and/or (iii) maintains Inventory with a value of $5,000,000 or greater at any time. Each of such leases and subleases is valid and enforceable in accordance with its terms and is in full force and effect, and no default by any party to any such lease or sublease exists which could reasonably be expected to have a Material Adverse Effect. Each of AXE, Anixter, and each Subsidiary of Anixter has good title to all of its personal property, except for imperfections of title (including Liens to the extent permitted by Section 6.2 ) which in the aggregate
 
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could not reasonably be expected to have a Material Adverse Effect. All such assets are free and clear of all Liens, except as otherwise specifically permitted by the terms and provisions of this Agreement and the other Loan Documents. Substantially all of the assets and properties owned by, leased to, or used by Anixter or any Domestic Subsidiary of Anixter are in good repair, working order and condition, excepting ordinary wear and tear and are free and clear of any known defects except such defects as do not substantially interfere with the continued use thereof in the conduct of normal operations.
(b) Anixter and each other Loan Party owns, is licensed to use, or otherwise has the lawful right to use or has all permits and other approvals of Governmental Authorities, all trademarks, tradenames, copyrights, patents and other intellectual property necessary to its business as currently conducted and proposed to be conducted in connection with and following the consummation of the Related Transactions which are material to its financial condition, business, operations, assets and prospects, individually or taken as a whole. A correct and complete list of all trademarks, tradenames, copyrights, and patents owned by Anixter or any other Loan Party referred to in the preceding sentence, as of the date of this Agreement, is set forth on Schedule 4.5 . The use of such intellectual property by Anixter and its Subsidiaries does not infringe in any material respect upon the rights of any other Person, subject to such claims and infringements the existence of which do not have or could not reasonably be expected to have a Material Adverse Effect.
4.6 Litigation and Environmental Matters .
(a) There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of any Loan Party, threatened in writing against or affecting any of AXE, Anixter, or any Subsidiary (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters) or (ii) that challenges the enforceability of any of the Related Transactions Documents.
(b) None of AXE, Anixter, and the Subsidiaries of Anixter are subject to or in default with respect to any final judgment, writ, injunction, decree, order, rule or regulation of any court or Governmental Authority which has had or could reasonably be expected to have a Material Adverse Effect.
(c) Except for the Disclosed Matters and except as could not reasonably be expected to have a Material Adverse Effect, (i) each of the operations of AXE, Anixter, and the Subsidiaries of Anixter comply with all applicable Environmental Laws and all Requirements of Law (relating to health and safety matters); (ii) each of AXE, Anixter, and the Subsidiaries of Anixter has obtained all Permits (as such term is used in the definition of “Environmental Laws”) necessary for its operations, all such Permits are in good standing and AXE, Anixter and the Subsidiaries of Anixter are in compliance with all terms and conditions of such Permits; and (iii)(A) neither AXE, Anixter, nor any Subsidiary of Anixter, nor any of their present Property or operations and (B) to the knowledge of Anixter, none of AXE’s, Anixter’s, or any Subsidiary’s previously owned Property or past operations is subject to any Remedial Action or other liabilities and costs arising from the Release or threatened Release of a Hazardous Material into the environment.
4.7 Compliance with Laws and Agreements; No Default . Except where the failure to do so, individually or in the aggregate, has not resulted in and could not reasonably be expected to result in a
 
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Material Adverse Effect, each of AXE, Anixter, and the Subsidiaries of Anixter is in compliance with (i) all Requirements of Law applicable to it or its business and (ii) all indentures, agreements, and other instruments binding upon it or its property. No Default or Event of Default has occurred and is continuing.
4.8 Investment Company Status . No Loan Party or any Subsidiary is an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940.
4.9 Taxes . Each of AXE, Anixter, and the Subsidiaries of Anixter has timely filed or caused to be filed all U.S. federal income and other material Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings and for which such Person has set aside on its books adequate reserves with respect thereto in accordance with GAAP, (b) Taxes which are not yet delinquent, (c) Taxes which are payable in installments so long as paid before any penalty accrues with respect thereto, and (d) Taxes which do not exceed $500,000 in the aggregate. Except as set forth in clauses (a) through (d)  above, no such Person has any knowledge of any proposed tax assessment against Anixter or any of Anixter’s Subsidiaries which could reasonably be expected to result in a Material Adverse Effect. No tax liens have been filed and no claims are being asserted with respect to any such taxes except for Taxes not exceeding $500,000 in the aggregate.
4.10 ERISA . No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. As of each date that this representation is made or deemed made, the present value of all “accumulated projected benefit obligations” (as determined for purposes of AXE’s Form 10-K) of all underfunded Pension Plans (based on the assumptions used by the Plans to determine benefit obligations on an ongoing basis) did not, as of the date of the most recent financial statements reflecting such amounts, exceed by more than $75,000,000 the fair market value of the assets of all such underfunded Plans.
4.11 Disclosure . Subject to changes in facts or conditions which are required or permitted under this Agreement, none of the reports, financial statements, certificates or other information furnished by or on behalf of any of AXE, Anixter, and the Subsidiaries of Anixter to Administrative Agent or any Lender in connection with the negotiation of this Agreement or any other Loan Document (as modified or supplemented by other information so furnished), taken as a whole, contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
4.12 Performance . None of AXE, Anixter, and the Subsidiaries of Anixter is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any Contractual Obligation applicable to it the effect of which could reasonably be expected to result in a Material Adverse Effect, and no condition exists which, with the giving of notice or the lapse of time or both, would constitute a default under any such Contractual Obligation, except where the consequences, direct or indirect, of such default or defaults, if any, have not resulted in and could not reasonably be expected to result in a Material Adverse Effect.
4.13 Solvency . Anixter and its Subsidiaries are Solvent after giving effect to the transactions contemplated by this Agreement and the other Related Transactions Documents.
 
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4.14 Insurance . Schedule 4.14 sets forth a description of all insurance maintained by or on behalf of Anixter and its Subsidiaries as of the Closing Date. As of the Closing Date, all premiums in respect of such insurance have been paid. Anixter maintains, and has caused each Subsidiary to maintain, with financially sound and reputable insurance companies, insurance on all their real and personal property in such amounts, subject to such deductibles and self-insurance retentions and covering such properties and risks as are adequate and customarily maintained by companies engaged in the same or similar businesses operating in the same or similar locations.
4.15 Capitalization and Subsidiaries; Joint Venture; Partnership .
(a) As of the Closing Date, Schedule 4.15 sets forth (i) a correct and complete list of the name each Subsidiary of Anixter, (ii) a true and complete listing of each class of each of such Person’s authorized Equity Interests, all of which issued Equity Interests are owned beneficially and of record by the Persons identified on Schedule 4.15 , and (iii) the type of entity of each such Person. All of the issued and outstanding Equity Interests of each such Subsidiary have been (to the extent such concepts are relevant with respect to such ownership interests) duly authorized and issued and are fully paid and non-assessable. There are no outstanding commitments or other obligations of Anixter or any such Subsidiary to issue, and no options, warrants or other rights of any Person to acquire, any shares of any class of capital stock or other equity interests of Anixter or any such Subsidiary.
(b) Anixter has no Subsidiaries other than those described in Schedule 4.15 and those, if any, which are permitted by Section 6.4(a) to be created after the Closing Date.
(c) Except as set forth in Schedule 4.15 or as otherwise permitted in this Agreement, none of AXE, Anixter, and the Subsidiaries of Anixter is engaged in any material partnership or material joint venture with any other Person.
4.16 Security Interest in Collateral . The provisions of this Agreement and the other Loan Documents create legal and valid Liens on all of the Collateral in favor of Administrative Agent, for the benefit of each member of the Lender Group and each of the Bank Product Providers, and such Liens constitute perfected and continuing Liens on the Collateral, securing the Obligations, enforceable against the applicable Loan Party and all third parties, and having priority over all other Liens on the Collateral except in the case of (a) Permitted Encumbrances and Liens permitted by Section 6.2(c) , Section 6.2(d) , Section 6.2(e) , Section 6.2(f) , and Section 6.2(j) , to the extent any such Permitted Encumbrances or any such Liens would have priority over Administrative Agent’s Liens pursuant to any applicable law, and (b) Liens perfected only by possession (including possession of any certificate of title), to the extent Administrative Agent has not obtained or does not maintain possession of such Collateral.
4.17 [Reserved].
4.18 Federal Reserve Regulations . No part of the proceeds of any Loan or Letter of Credit has been used or will be used, whether directly or indirectly, for any purpose that entails a violation of Regulation T, U, or X.
4.19 Use of Proceeds . The proceeds of the Loans have been used and will be used, whether directly or indirectly as set forth in Section 5.8 .
4.20 [Reserved].
 
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4.21 Restricted Payments to AXE . On or after the Closing Date, none of Anixter and its Subsidiaries has directly or indirectly declared, ordered, paid or made or set apart any sum or property for any payment, distribution, or contribution to or investment in AXE (whether in cash or otherwise) or agreed to do so, except to the extent permitted pursuant to Section 6.8(a) .
4.22 Anti-Corruption Laws and Sanctions . Each of AXE, Anixter, and the Subsidiaries of Anixter has implemented and maintains in effect policies and procedures designed to ensure compliance by such Person, its Subsidiaries, and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and such Person, its Subsidiaries, and their respective officers and employees and, to the knowledge of such Person, its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects and are not knowingly engaged in any activity that would reasonably be expected to result in any of AXE, Anixter, and the Subsidiaries of Anixter being designated as a Sanctioned Person. None of (a) AXE, Anixter, and the Subsidiaries of Anixter or, to the knowledge of any such Person, any of their respective directors, officers or employees, or (b) to the knowledge of any such Person, any agent of such Person that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. No Borrowing or Letter of Credit, use of proceeds, Transaction, or other transaction contemplated by this Agreement or the other Loan Documents will violate Anti-Corruption Laws or applicable Sanctions.
4.23 HD Supply Acquisition .
(a) Anixter has delivered to Administrative Agent a complete and correct copy of the HD Supply Acquisition Documents, including all schedules and exhibits thereto. The execution, delivery and performance of each HD Supply Acquisition Document has been duly authorized by all necessary action on the part of Anixter and each Subsidiary of Anixter that is a party thereto. Each HD Supply Acquisition Document is the legal, valid and binding obligation of Anixter or each Subsidiary of Anixter who is a party thereto, enforceable against each such Person in accordance with its terms, in each case, except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting generally the enforcement of creditors’ rights and (ii) the availability of the remedy of specific performance or injunctive or other equitable relief is subject to the discretion of the court before which any proceeding therefor may be brought. As of the Closing Date, all representations and warranties made by of Anixter and its Subsidiaries in the HD Supply Acquisition Documents and in the certificates delivered in connection therewith are true and correct in all material respects.
(b) As of the Closing Date, after giving effect to the transactions contemplated by the HD Supply Acquisition Documents, one or more of Anixter and its Subsidiaries will have good title to the Equity Interests and assets acquired pursuant to the HD Supply Acquisition Agreement, free and clear of all Liens other than Permitted Encumbrances and Liens permitted by Section 6.2(f) and Section 6.2(i) .
4.24 Indebtedness . Set forth on Schedule 6.1 is a true and complete list of all Indebtedness of each Loan Party and each of its Subsidiaries outstanding immediately as of October 5, 2015, that is to remain outstanding after giving effect to the closing hereunder on the Closing Date and such schedule accurately sets forth the aggregate principal amount of such Indebtedness as of the Closing Date.
4.25 Eligible Inventory . As to each item of Inventory that is identified by Borrowers as Eligible Inventory in a Borrowing Base Certificate submitted to Administrative Agent, such Inventory is
 
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(i) of good and merchantable quality, free from known defects, and (ii) not excluded as ineligible by virtue of one or more of the excluding criteria (other than any Administrative Agent-discretionary criteria) set forth in the definition of “Eligible Inventory.”
4.26 Location of Inventory . The Inventory of Borrowers and their Subsidiaries is not stored with a bailee, warehouseman, or similar party and is located only at, or in-transit between, the locations identified on Schedule 5.15 (as such schedule may be updated pursuant to Section 5.15 ).
4.27 Inventory Records . Each Loan Party keeps correct and accurate records itemizing and describing the type, quality, and quantity of its and its Subsidiaries’ Inventory and the book value thereof.
4.28 Swap Agreements . On each date that any Swap Agreement is executed by any Swap Provider, each Borrower and each other Loan Party satisfy all eligibility, suitability, and other requirements under the Commodity Exchange Act (7 U.S.C. § 1, et seq., as in effect from time to time) and the Commodity Futures Trading Commission regulations.
5. AFFIRMATIVE COVENANTS .
Each Borrower covenants and agrees that, until termination of all of the Commitments and payment in full of the Obligations:
5.1 Financial Statements; Borrowing Base; Other Information . Anixter or the Borrowers, as applicable, will furnish (or will caused to be furnished) to Administrative Agent:
(a) within ninety (90) days after the end of each Fiscal Year, on a consolidated basis for AXE, a balance sheet and related statements of operations, stockholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all reported on by Ernst & Young LLP or other firm of independent public accountants of recognized national standing regularly retained by AXE and reasonably acceptable to Administrative Agent (without a “going concern” or like qualification, commentary, or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of AXE on a consolidated basis in accordance with GAAP consistently applied;
(b) within forty-five (45) days after the end of each Fiscal Quarter (other than the last Fiscal Quarter of a Fiscal Year, which shall be delivered within sixty (60) days after the end of such Fiscal Quarter), on a consolidated basis for AXE, a balance sheet and related statements of operations, stockholders’ equity and cash flows as of the end of and for such Fiscal Quarter and the then elapsed portion of such Fiscal Year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous Fiscal Year, all certified by a Financial Officer of AXE as presenting fairly in all material respects the financial condition and results of operations of AXE on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;
(c) concurrently with any delivery of a Borrowing Base Certificate under clause (f) below or financial statements under clause (a) or (b)  above, a certificate of a Financial Officer of AXE in substantially the form of Exhibit D-1 (i) certifying, in the case of the financial statements delivered under clause (b) , as presenting fairly in all material respects the financial condition and results of operations of
 
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AXE on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes, (ii) certifying as to whether a Default or an Event of Default has occurred and, if a Default or an Event of Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (iii) setting forth, in the case of each such certificate delivered concurrently with the delivery of financial statements under clauses (a) and  (b)  above, reasonably detailed calculations of the financial covenants contained in this Agreement for or as of the end of each Fiscal Quarter then ended (regardless of whether a Financial Covenant Trigger Period is then in effect), and (iv) setting forth, in the case of each such certificate delivered concurrently with the delivery of financial statements under clauses (a) and (b)  above (and in the case of each such certificate delivered concurrently with the delivery of a Borrowing Base Certificate under clause (f) below after the end of any Fiscal Month in which Availability was less than 50% of the aggregate Revolver Commitments), a reasonably detailed calculation of the Secured Debt-to-CTNA Ratio;
(d) as soon as available but in any event within forty-five (45) days after the end of each Fiscal Year and at such other times as may be reasonably requested by Administrative Agent, a Perfection Certificate or a supplement to the Perfection Certificate;
(e) as soon as available but in any event no later than ninety (90) days after the end of each Fiscal Year, for AXE on a consolidated basis, a copy of the plan and forecast (including a projected balance sheet, income statement and cash flow statement) of AXE and its Subsidiaries, taken as a whole, for the upcoming period of four Fiscal Quarters (the “ Projections ”), all in form customarily prepared by Anixter’s management and reasonably satisfactory to Administrative Agent, to be accompanied by a certificate of a Financial Officer of Anixter to the effect that such Projections have been prepared on a basis believe by Anixter to be reasonable, which Projections shall include projected Availability, projected Combined Availability, and projected Senior Debt-to-CTNA Ratio for or as of the end of each of the four Fiscal Quarters covered by such Projections;
(f) as soon as available (but in any event (A) within thirty (30) days after the end of each Fiscal Quarter, (B) within thirty (30) days after the end of each Fiscal Month in which any Revolving Loans were outstanding or a Borrowing occurred, and (C) during an Enhanced Reporting Trigger Period, weekly, no later than the second Business Day of each week for the prior week), in connection with each request for a Borrowing (without limitation or duplication of any other delivery requirement under this Section 5.1(f) ) further to the condition set forth in Section 3.2(c) , and at such other times as may be necessary to re-determine Availability and/or Combined Availability or as may be reasonably requested by Administrative Agent, as of the period then ended, a Borrowing Base Certificate and supporting information in connection therewith (including (i) a calculation of the Secured Debt Indenture Cap Amount as of the end of the applicable period then ended, and (ii) in respect of any Borrowing Base Certificate delivered for a Fiscal Quarter, a calculation of Average Quarterly Combined Availability for such quarter then ended and an indication of what the Applicable Rate is as a result of such Average Quarterly Combined Availability), together with any additional reports with respect to the Borrowing Base as Administrative Agent may reasonably request;
(g) as soon as available (but in any event (A) within thirty (30) days after the end of each Fiscal Quarter, (B) within thirty (30) days after the end of each Fiscal Month in which any Revolving Loans were outstanding or a Borrowing occurred, and (C) during an Enhanced Reporting Trigger Period, weekly, no later than the second Business Day of each week for the prior week) and at
 
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such other times as may be requested by Administrative Agent, the following as of the period then ended, all delivered electronically in a text formatted file reasonably acceptable to Administrative Agent:
(i) a detailed Inventory system/perpetual report together with a reconciliation to Borrowers’ general ledger accounts (delivered electronically in an acceptable format, if Borrower has implemented electronic reporting),
(ii) a detailed calculation of Inventory categories that are not eligible for the Borrowing Base, if Borrowers have not implemented electronic reporting,
(iii) a reconciliation of Inventory of Borrowers’ general ledger accounts to its monthly financial statements including any book reserves related to each category; and
(iv) a reconciliation of the loan balance per the Borrowers’ general ledger to the loan balance under this Agreement;
(h) as soon as available but in any event within thirty (30) days after the end of each Fiscal Month and at such other times as may be reasonably requested by Administrative Agent, the following as of the period then ended, all delivered electronically in a text formatted file reasonably acceptable to Administrative Agent:
(i) a schedule and aging of the Borrowers’ accounts payable; and
(ii) a gross Inventory report;
(i) promptly upon Administrative Agent’s reasonable request during an Enhanced Reporting Trigger Period, a written update report, in form and substance reasonably acceptable to Administrative Agent, relating to the trademarks, tradenames, copyrights, patents and other intellectual property (including intellectual property licenses) necessary to each Loan Party’s business which are material to such Loan Party’s financial condition, business, operations, assets and prospects, individually or taken as a whole;
(j) promptly upon Administrative Agent’s reasonable request:
(i) copies of invoices issued by the Borrowers in connection with any Accounts, credit memos, shipping and delivery documents, and other information related thereto;
(ii) copies of purchase orders, invoices, and shipping and delivery documents in connection with any Inventory purchased by any Loan Party; and
(iii) a schedule detailing the balance of all intercompany accounts of AXE, Anixter, and the Subsidiaries of Anixter;
(k) [reserved];
(l) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by AXE or Anixter with the SEC, or any Governmental Authority succeeding to any or all of the functions of the SEC, or with any national securities exchange, or distributed by AXE to its shareholders generally; and
 
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(m) promptly following any request therefor, such other information regarding the operations, business affairs, or financial condition of Anixter or any Subsidiary of Anixter, the Collateral, or compliance with the terms of this Agreement, as Administrative Agent or any Lender may reasonably request.
5.2 Notices of Material Events . Anixter or the Borrowers, as applicable, will furnish (or will cause to be furnished) to Administrative Agent prompt (but in any event within any time period that may be specified below) written notice of the following:
(a) the occurrence of any Default or Event of Default;
(b) (i) receipt of any notice of any investigation by a Governmental Authority or any litigation or proceeding commenced or threatened against Anixter or any Subsidiary of Anixter that seeks damages in excess of $35,000,000 except where the same is fully covered (other than any applicable co-insurance or deductible) by insurance (other than insurance in the nature of retro-premium insurance or other self-insurance programs); (ii) receipt of any notice of any investigation or any proceeding before or by any Governmental Authority, the effect of which might be (A) to limit, prohibit, or restrict materially the manner in which Anixter or any Subsidiary of Anixter currently conducts its business and proposes to conduct its business in connection with and following the consummation of the Related Transactions, if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect, or (B) to declare any substance contained in the products manufactured or distributed by it to be dangerous, if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect; or (iii) receipt of any notice of any investigation by a Governmental Authority or any litigation or proceeding commenced or threatened against Anixter or any Subsidiary of Anixter that (A) seeks injunctive relief, if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect, (B) is asserted or instituted against any Plan, its fiduciaries or its assets, if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect, (C)(1) alleges criminal misconduct by Anixter or any other Loan Party, or (2) alleges criminal misconduct by any Subsidiary of Anixter not described in subclause (1) of this clause (C) , if such misconduct has resulted in or could reasonably be expected to result in a Material Adverse Effect, or (D) asserts liability on the part of Anixter or any Subsidiary of Anixter in excess of $7,500,000 in respect of any tax, fee, assessment, or other governmental charge, or (E) involves any product recall, if such investigation or proceeding has resulted in or could reasonably be expected to result in a Material Adverse Effect;
(c) any of the following that, alone or together, could reasonably be expected to result in a Material Adverse Effect: (i) notice that any Property of Anixter or any Subsidiary of Anixter is subject to an Environmental Lien, or (ii) notice to Anixter or any Subsidiary of Anixter or awareness by Anixter or any Subsidiary of Anixter of a condition that could reasonably be expected to result in (A) a notice of violation of any health or safety Requirement of Law or any Environmental Law, or (B) any Environmental Liability;
(d) any Lien or claim made or asserted against any of the Collateral, other than Permitted Encumbrances and Liens permitted by Section 6.2 ;
(e) at least five (5) Business Days before the effectiveness of any material involuntary accounting writedown of assets included in Consolidated Tangible Net Assets, written notice
 
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of such proposed accounting writedown and a certificate of a Financial Officer of Anixter attaching and certifying pro forma computations of the Secured Debt-to-CTNA Ratio before and after giving effect to such proposed involuntary accounting writedown;
(f) within two (2) Business Days of receipt thereof, any and all default notices received under or with respect to any leased location or public warehouse for which (i) a chief executive office is maintained, (ii) books and records are maintained, or (iii) Collateral with a value of $5,000,000 or greater in the aggregate is located;
(g) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect;
(h) as soon as available, but not less than ten (10) days prior to the consummation of any acquisition or Investment proposed to be permitted by Section 6.4(a)(v) , (i) notice of such proposed acquisition or proposed Investment, and (ii) a copy of all business and financial information reasonably requested by Administrative Agent including pro forma financial statements, statements of cash flow, and Availability projections; and
(i) any other development that results, or could reasonably be expected to result, in a Material Adverse Effect.
Each notice delivered under this Section 5.2 shall be accompanied by a statement of a Financial Officer or other executive officer of Anixter setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
5.3 Existence; Conduct of Business . Anixter will, and will cause each of its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, qualifications, licenses, permits, franchises, governmental authorizations, intellectual property rights, licenses and permits material to the conduct of its business, and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted, except in those jurisdictions where the failure to do so could not reasonably be expected to result in a Material Adverse Effect and provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.3 . Following the end of each Fiscal Quarter, Anixter shall promptly provide Administrative Agent and each of the Lenders with a complete list of its Subsidiaries, including any changes in the list set forth on Schedule 4.15 with respect to Subsidiaries having assets in excess of $1,000,000 individually or $5,000,000 in the aggregate.
5.4 Payment of Obligations . Anixter will, and will cause each of its Subsidiaries to, pay or discharge (a) all material Taxes imposed upon it or any of its properties or assets or in respect of any of its franchises, business, income, or property before any penalty or interest accrues thereon, and (b) all material claims (including claims for labor, services, materials and supplies) for sums which have become due and payable and which by law have or may become a Lien (other than a Customary Permitted Lien) upon any of its properties or assets, prior to the time when any penalty or fine shall be incurred with respect thereto; provided , however, that (i) no such Taxes referred to in clause (a) above or no such claim referred to in clause (b) above need to be paid or discharged where the validity or amount thereof is being contested in good faith by appropriate proceedings and such Person has set aside on its books adequate reserves with respect thereto in accordance with GAAP, and (ii) Anixter will, and will cause each of its Subsidiaries to, remit withholding taxes and other payroll taxes to appropriate Governmental Authorities as and when claimed to be due, notwithstanding the foregoing exceptions.
 
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5.5 Maintenance of Properties . Anixter will, and will cause each of its Subsidiaries to, keep and maintain all property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted.
5.6 Books and Records; Inspection Rights . Anixter will, and will cause each of its Subsidiaries to, (a) keep proper books of record and account with respect to the Collateral (including a system of accounting established and administered in accordance with sound business practices and consistent with past practice to permit preparation of financial statements in conformity with GAAP and, if required by the terms of this Agreement, in conformity with Agreement Accounting Principles, and each of the financial statements described in Section 5.1 shall be prepared from such system and records), in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities, and (b) permit any representatives designated by Administrative Agent or any Lender (including employees of Administrative Agent, any Lender or any consultants, accountants, lawyers, agents and appraisers retained by Administrative Agent), upon reasonable prior notice, to visit and inspect its properties, to conduct at such Person’s premises field examinations of such Person’s assets, liabilities, books and records, including examining and making extracts from its books and records, environmental assessment reports, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested. Anixter, for itself and on behalf of each of its Subsidiaries, acknowledges that Administrative Agent, after exercising its rights of inspection, may prepare and distribute to the Lenders certain Reports pertaining to such Person’s assets for internal use by Administrative Agent and the Lenders.
5.7 Compliance with Laws and Material Contractual Obligations . Anixter will, and will cause each of its Subsidiaries to, (a) comply with each Requirement of Law and Environmental Law applicable to it or its property and (b) perform in all material respects its obligations under material agreements to which it is a party, except, in each case, where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. The Borrower will, and Anixter will and will cause each of its Subsidiaries to, maintain in effect and enforce policies and procedures designed to ensure compliance by such Person, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions.
5.8 Use of Proceeds .
(a) The proceeds of the Loans and the Letters of Credit will be used only for general corporate purposes of the Borrowers in the ordinary course of business and to pay a portion of the consideration payable in connection with the consummation of the HD Supply Acquisition. No part of the proceeds of any Loan and no Letter of Credit will be used, whether directly or indirectly, for any purpose that entails a violation of Regulation T, U, or X.
(b) The Borrowers will not request any Borrowing or Letter of Credit, and none of Anixter and its Subsidiaries shall use, and Anixter shall procure that Anixter and its Subsidiaries and its and their respective directors, officers, employees and agents shall not use, the proceeds of any Borrowing or Letter of Credit (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (ii)
 
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for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.
5.9 [Reserved].
5.10 Insurance .
(a) Anixter will and will cause each of its Subsidiaries to maintain with financially sound and reputable carriers having a financial strength rating of at least A- by A.M. Best Company (i) insurance in such amounts (with no greater risk retention) and against such risks (including loss or damage by fire and loss in transit; theft, burglary, pilferage, larceny, embezzlement, and other criminal activities; business interruption; and general liability) and such other hazards, as is customarily maintained by companies of established repute engaged in the same or similar businesses operating in the same or similar locations and (ii) all insurance required pursuant to the Collateral Documents. Anixter will furnish to the Lenders, upon request of Administrative Agent, information in reasonable detail as to the insurance so maintained. If Anixter or its Subsidiaries fails to maintain such insurance, Administrative Agent may arrange for such insurance, but at the expense and without any responsibility on Administrative Agent’s part for obtaining the insurance, the solvency of the insurance companies, the adequacy of the coverage, or the collection of claims
(b) All property insurance policies covering the Collateral are to name Administrative Agent as lenders loss payee for the benefit of Administrative Agent and the Lenders, as their interests may appear, in case of loss, pursuant to a standard loss payable endorsement with a standard non-contributory “lender” or “secured party” clause. All certificates of property and general liability insurance are to be delivered to Administrative Agent, with the loss payable (but only in respect of Collateral) and additional insured endorsements in favor of Agent and shall provide for not less than thirty (30) days’ (ten (10) days’ in the case of non-payment) prior written notice to Administrative Agent of the exercise of any right of cancellation.
(c) Upon the occurrence and during the continuance of an Event of Default, the Administrative Agent shall have the sole right, subject to the Intercreditor Agreement, to file claims under any property and general liability insurance policies in respect of the Collateral, to receive, receipt and give acquittance for any payments that may be payable thereunder, and to execute any and all endorsements, receipts, releases, assignments, reassignments or other documents that may be necessary to effect the collection, compromise, or settlement of any claims under any such insurance policies.
5.11 Casualty and Condemnation . Anixter will (a) furnish to Administrative Agent prompt written notice of any casualty or other insured damage to any material portion of the Collateral or the commencement of any action or proceeding for the taking of any material portion of the Collateral or interest therein under power of eminent domain or by condemnation or similar proceeding and (b) subject to Section 5.10(c) , ensure that the net proceeds of any such event (whether in the form of insurance proceeds, condemnation awards or otherwise) are collected and applied in accordance with the applicable provisions of this Agreement and the Collateral Documents to the extent applicable.
 
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5.12 Depository Banks . Each Borrower will maintain one or more of the Lenders as its principal depository bank, including for the maintenance of operating, administrative, cash management, collection activity and other deposit accounts for the conduct of its business.
5.13 Employee Benefit Matters . Anixter will, and will cause each of its Subsidiaries to, establish, maintain and operate, all Plans in all material respects in compliance with the applicable provisions of ERISA, the IRC, and all other applicable laws, and the regulations and interpretations thereunder, and the respective requirements of the governing documents for such Plans. Anixter will, and will cause each of its Subsidiaries and other ERISA Affiliates to, establish, maintain and operate all Foreign Employee Benefit Plans to comply in all material respects with all laws, regulations and rules applicable thereto and the respective requirements of the governing documents for such Foreign Employee Benefit Plans.
5.14 Formation of Subsidiaries; Further Assurances .
(a) Each Borrower will, at the time that any Loan Party forms any direct or indirect Subsidiary (other than an Excluded Subsidiary), acquires any direct or indirect Subsidiary (other than an Excluded Subsidiary) after the Closing Date, or causes any existing direct or indirect Subsidiary to become party to a Receivables Transfer Agreement, within 20 days of such formation, acquisition, or other applicable qualifying event (or such later date as permitted by Administrative Agent in its sole discretion) (i) cause such new Subsidiary to provide to Administrative Agent a joinder to this Agreement and/or to the Guaranty and Security Agreement, together with such other security agreements, as well as appropriate financing statements, all in form and substance reasonably satisfactory to Administrative Agent (including being sufficient to grant Administrative Agent a first-priority Lien (subject to Permitted Encumbrances and Liens permitted by Section 6.2(d) , Section 6.2(e) , Section 6.2(f) , and Section 6.2(j) ) in and to the assets of such newly formed or acquired Subsidiary), (ii) provide, or cause the applicable Loan Party to provide, to Administrative Agent a pledge agreement (or an addendum to the Guaranty and Security Agreement) and appropriate certificates and powers or financing statements, pledging all of the direct or beneficial ownership interest in such new Subsidiary in form and substance reasonably satisfactory to Administrative Agent, (iii) if such Subsidiary becomes or is intended to become party to a Receivables Transfer Agreement, cause such Subsidiary to provide to Administrative Agent a joinder to the Intercreditor Agreement in substantially the form attached to the Intercreditor Agreement, and (iv) provide to Administrative Agent all other documentation, including one or more opinions of counsel reasonably satisfactory to Administrative Agent, which, in its opinion, is appropriate with respect to the execution and delivery of the applicable documentation referred to above. Any document, agreement, or instrument executed or issued by a Loan Party (including any Subsidiary that becomes a Loan Party) pursuant to this Section 5.14(a) shall constitute a Loan Document.
(b) Each Borrower will, and will cause each of the other Loan Parties to, at any time upon the reasonable request of Administrative Agent, execute or deliver to Administrative Agent any and all financing statements, security agreements, pledges, assignments, and all other similar documents that Administrative Agent may reasonably request in form and substance reasonably satisfactory to Administrative Agent, to create, perfect, and continue perfected or to better perfect Administrative Agent’s Liens in substantially all of the assets of Anixter and its Subsidiaries (other than Excluded Subsidiaries, and subject to other exceptions and limitations contained in the Loan Documents), and in order to fully consummate all of the transactions contemplated hereby and under the other Loan Documents. To the maximum extent permitted by applicable law, if any Borrower or any other Loan Party
 
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refuses or fails to execute or deliver any reasonably requested financing statement or other similar ministerial document within a reasonable period of time following the request to do so, each Borrower and each other Loan Party hereby authorizes Administrative Agent to execute any such financing statement or other similar ministerial document in the applicable Loan Party’s name and authorizes Administrative Agent to file such executed financing statement or other similar ministerial document in any appropriate filing office. In furtherance of, and not in limitation of, the foregoing, each Loan Party shall take such actions as Administrative Agent may reasonably request from time to time to ensure that the Obligations are guaranteed by the Guarantors and are secured by substantially all of the assets of Anixter and its Subsidiaries (other than Excluded Subsidiaries, and subject to other exceptions and limitations contained in the Loan Documents).
5.15 Location of Inventory . Each Borrower will, and will cause each of the other Loan Parties to, keep its Inventory only at the locations identified on Schedule 5.15 ; provided , that Borrowers may amend Schedule 5.15  so long as (i) such amendment occurs by written notice to Administrative Agent not less than 10 days prior to the date on which such Inventory is moved to such new location, (ii) such new location is within the continental United States, and (iii) at the time of such written notification, either (A) the applicable Loan Party provides Administrative Agent a Collateral Access Agreement with respect thereto or (B) if the applicable Loan Party does not so provide Administrative Agent a Collateral Access Agreement with respect thereto, Administrative Agent has the option, in its discretion, to institute a reserve for rent in accordance with Section 2.1(c) hereof.
5.16 Post-Closing Security Perfection . The Borrowers will, and Anixter will and will cause each of its Subsidiaries to, deliver or cause to be delivered such documents and instruments, and take or cause to be taken such other actions as may be reasonably necessary to provide the perfected security interests described in Section 3.1(m) that are not so provided on the Closing Date, and in any event to provide such perfected security interests and to satisfy such other conditions within the applicable time periods set forth on Schedule 5.16 , as such time periods may be extended by Administrative Agent, in its sole discretion.
6. NEGATIVE COVENANTS .
Each Borrower covenants and agrees that, until termination of all of the Commitments and payment in full of the Obligations:
6.1 Indebtedness .
(a) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, create, incur, assume or suffer to exist any Indebtedness, except:
(i) the Obligations;
(ii) Indebtedness existing on the date hereof and set forth in Schedule 6.1 and any extensions, renewals, refinancings and replacements of any such Indebtedness in accordance with clause (xiii) of this Section 6.1 ;
(iii) Indebtedness in respect of Accommodation Obligations permitted by Section 6.4(b) ;
 
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(iv) (A) Indebtedness of ARC to Anixter arising under Receivables Facility Transactions, provided that such Indebtedness shall be subordinated to the Receivables Facility Secured Obligations on terms reasonably satisfactory to the Receivables Facility Administrative Agent; and (B) unsecured Indebtedness of Anixter to any Subsidiary of Anixter (other than ARC) and of any Subsidiary of Anixter (other than ARC) to Anixter or any other Subsidiary of Anixter (other than ARC), provided that (1) Indebtedness of any Subsidiary that is not a Loan Party to Anixter or any other Loan Party shall be subject to clause (ix) of Section 6.4(a) , and (2) Indebtedness of any Loan Party to any Subsidiary of Anixter that is not a Loan Party shall be subordinated to Obligations on terms reasonably satisfactory to Administrative Agent;
(v) other unsecured debt of Anixter subordinated in right of payment with the Obligations on terms and conditions satisfactory to Administrative Agent;
(vi) other unsecured Indebtedness of Anixter’s Subsidiaries that are Guarantors subordinated on terms and conditions satisfactory to Administrative Agent in right of payment with the Obligations;
(vii) Indebtedness of Anixter or any of its Subsidiaries incurred to finance the acquisition, construction or improvement of any fixed or capital assets (whether or not constituting purchase money Indebtedness), including obligations under Capital Leases and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and extensions, renewals and replacements of any such Indebtedness in accordance with clause (xiii) of this Section 6.1(a) ; provided that (A) such Indebtedness is incurred prior to or within ninety (90) days after such acquisition or the completion of such construction or improvement and (B) the aggregate principal amount of Indebtedness permitted by this clause (vii) together with any Refinance Indebtedness in respect thereof permitted by clause (xiii) of this Section 6.1(a) , shall not exceed $50,000,000 at any time outstanding;
(viii) Indebtedness of one or more of Anixter and its Subsidiaries under the Receivables Facility;
(ix) unsecured Indebtedness of Anixter in an aggregate principal amount of up to $500,000,000 evidenced by certain senior unsecured notes and incurred in connection with, and for the purpose of financing a portion of the consideration payable in connection with, the consummation of the HD Supply Acquisition;
(x) Indebtedness of Anixter Canada in an aggregate principal amount of up to CAD 300,000,000 in the form of a term loan incurred in connection with, and for the purpose of financing portion of the consideration payable in connection with, the consummation of the HD Supply Acquisition;
(xi) Indebtedness (including Indebtedness represented by letters of credit) of Anixter Canada in an aggregate principal amount of up to CAD 50,000,000 in the form of a revolving credit facility incurred for working capital and other general corporate purposes;
(xii) Indebtedness (including Indebtedness represented by letters of credit) of Foreign Subsidiaries of Anixter (other than Anixter Canada) in an aggregate principal amount of up to $150,000,000 incurred for working capital and other general corporate purposes;
 
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(xiii) Indebtedness which represents extensions, renewals, refinancing or replacements (such Indebtedness being so extended, renewed, refinanced or replaced being referred to herein as the “ Refinance Indebtedness ”) of any of the Indebtedness described in clauses (ii) and (vii)  of this Section 6.1(a) (such Indebtedness being referred to herein as the “ Original Indebtedness ”); provided that (A) such Refinance Indebtedness does not increase the principal amount (except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing and by an amount equal to any existing commitments unutilized thereunder) or interest rate of the Original Indebtedness, (B) any Liens securing such Refinance Indebtedness are not extended to any additional property of Anixter or any of its Subsidiaries, (C) neither Anixter nor any Subsidiary of Anixter, as the case may be, that was not originally obligated with respect to repayment of such Original Indebtedness is required to become obligated with respect to such Refinance Indebtedness, (D) such Refinance Indebtedness does not result in a shortening of the average weighted maturity of such Original Indebtedness, (E) the terms of such Refinance Indebtedness are not materially less favorable to the obligor thereunder than the original terms of such Original Indebtedness (other than changes in the interest rates applicable thereto to reflect current market conditions), and (F) if such Original Indebtedness was subordinated in right of payment to the Obligations, then the terms and conditions of such Refinance Indebtedness must include subordination terms and conditions that are at least as favorable to Administrative Agent and the Lenders as those that were applicable to such Original Indebtedness;
(xiv) Indebtedness under Swap Agreements permitted under Section 6.7 ; and
(xv) Indebtedness of Anixter and any other member of the Consolidated Group owing to Bank Mendes Gans N.V. (or any successor thereto) in an aggregate amount not at any time to exceed the aggregate amount on deposit by the Consolidated Group with Bank Mendes Gans N.V. (or any successor thereto) at such time.
(b) Notwithstanding anything to the contrary contained in Section 6.1(a) , Anixter will not, and will not permit any of its applicable Subsidiaries to, create or incur any Specified Secured Debt unless (i) after giving effect to the creation or incurrence of such Specified Secured Debt, the pro forma Secured Debt-to-CTNA Ratio would not be 10% or greater, and (ii) not later than five (5) Business Days prior to any proposed creation or incurrence of Specified Secured Debt, Anixter furnishes (or causes to be furnished) to Administrative Agent written notice of such proposed creation or incurrence of Specified Secured Debt and a certificate of a Financial Officer of Anixter certifying compliance with this Section 6.1(b) and attaching pro forma computations of the Secured Debt-to-CTNA Ratio before and after giving effect to such proposed creation or incurrence of Specified Secured Debt.
6.2 Liens . No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues or rights in respect of any thereof, except:
(a) Liens created pursuant to any Loan Document;
(b) Permitted Encumbrances;
 
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(c) any Lien on any property or asset of Anixter or any of its Subsidiaries existing on the date hereof and set forth in Schedule 6.2 ; provided that (i) such Lien shall not apply to any other property or asset of Anixter or such Subsidiary and (ii) such Lien shall secure only those obligations which it secures on the date hereof, and extensions, renewals, and replacements thereof that do not increase the outstanding principal amount thereof;
(d) Liens on fixed or capital assets acquired, constructed or improved by Anixter or any of its Subsidiaries; provided that (i) such Liens secure Indebtedness permitted by clause (vii) of Section 6.1(a) , (ii) such Liens and the Indebtedness secured thereby are incurred prior to or within ninety (90) days after such acquisition or the completion of such construction or improvement, (iii) such Liens shall not apply to any other property or assets of Anixter or any of its Subsidiaries, and (iv) the value of the Property securing such Indebtedness approximates the amount of such Indebtedness;
(e) any Lien existing on any property or asset prior to the acquisition thereof by Anixter or any of its Subsidiaries or existing on any property or asset of any Person that is acquired in an acquisition permitted by Section 6.4(a)(v) that is consummated after the date hereof; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition, (ii) such Lien shall not apply to any other property or assets (other than additions, accessions, and improvements thereto and the proceeds and products thereof), and (iii) such Lien shall secure only those obligations which it secures on the date of such acquisition and extensions, renewals, and replacements thereof that do not increase the outstanding principal amount thereof;
(f) Liens in favor of the Receivables Facility Administrative Agent arising in connection with and securing the Indebtedness under the Receivables Facility permitted by clause (viii) of Section 6.1(a) ;
(g) Liens arising in connection with and securing Indebtedness permitted by clauses (x) , (xi) , and (xii)  of Section 6.1(a) ;
(h) Liens on assets of any joint venture described in clause (vi) of Section 6.4(a) ;
(i) Liens on the assets of Foreign Subsidiaries of Anixter; provided that the aggregate amount of Indebtedness secured by such Liens shall not exceed the amounts set forth in clauses (x) , (xi) , and (xii)  of Section 6.1(a) ;
(j) (i) Liens in favor of ARC granted by Anixter arising in connection with the Receivables Facility Transactions, and (ii) Liens in favor of Anixter granted by ARC arising in connection with the Receivables Facility Transactions and securing the Indebtedness permitted by clause (iv)(A) of Section 6.1(a) ;
(k) Liens not otherwise permitted hereunder in an aggregate principal amount not to exceed $10,000,000 at any time outstanding; and
(l) (i) Liens securing Swap Obligations; and (ii) Liens securing obligations under other Swap Agreements permitted by Section 6.7 , so long as the underlying assets securing such obligations are assets of one or more Foreign Subsidiaries.
 
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6.3 Fundamental Changes .
(a) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or liquidate or dissolve, except (i) subject to, and as required by, Section 5.16 , (ii) as otherwise permitted under Section 6.5 , and (iii) that, if at the time thereof and immediately after giving effect thereto no Event of Default shall have occurred and be continuing, any Subsidiary of Anixter (other than ARC) may merge into Anixter or another Subsidiary of Anixter (other than ARC); provided that any such merger involving a Person that is not a wholly owned Subsidiary immediately prior to such merger shall not be permitted unless also permitted by Section 6.4(a) .
(b) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, acquire by purchase or otherwise any property or assets of, or stock or other evidence of beneficial ownership of, any Person, except in the ordinary course of its business or to the extent permitted pursuant to Section 6.4(a) .
(c) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, engage to any material extent in any business other than businesses of the type conducted by the Borrower and its Subsidiaries on the date hereof, business of the type proposed to be conducted in connection with and following the consummation of the Related Transactions, and businesses in substantially similar or related business thereto and reasonable extensions thereof.
(d) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, change its fiscal year from the basis in effect on the Closing Date, except that any Subsidiary of Anixter may conform its fiscal year to Anixter’s Fiscal Year.
6.4 Investments, Loans, Advances, Guarantees, and Acquisitions .
(a) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, directly or indirectly make or commit to make any advance, loan, extension of credit or capital contribution, or purchase of any stock, bonds, notes, debentures or other securities or evidences of indebtedness of, or make any other investment in, any Person, including any Affiliate (each such transaction, an “ Investment ”), except:
(i) Investments by Anixter or any of its Subsidiaries in Cash Equivalents;
(ii) Investments in existence on the date hereof and described in Schedule 6.4 ;
(iii) Investments arising from sales in the ordinary course of business on customary trade terms;
(iv) Investments constituting loans by Anixter or any Subsidiary of Anixter to its employees not in excess of an aggregate amount of $10,000,000 outstanding at any one time;
(v) the acquisition (in any transaction or series of related transactions) by Anixter or any of its Subsidiaries of substantially all of the assets or all of the Equity Interests of any Person, and Investments in connection with any such acquisition, in each case so long as (A) such
 
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acquisition is not a hostile or contested acquisition, (B) the business acquired in connection with such acquisition is not engaged, directly or indirectly, in any line of business other than the businesses in which Anixter or any of its Subsidiaries are engaged on the Effective Date and any business activities that are substantially similar or related thereto, (C) no Event of Default exists or would result therefrom, and (D) the Payment Conditions are satisfied;
(vi) Investments in any joint ventures and Investments in connection with the purchase of any other Person’s interest in any such joint ventures, which do not exceed $50,000,000 in the aggregate outstanding at any one time;
(vii) Investments (other than those set forth on Schedule 6.4 ) in notes receivable received in connection with transactions permitted pursuant to Section 6.4(a)(iv) ;
(viii) Investments by Anixter in any Subsidiary of Anixter that is a Loan Party or by any Subsidiary of Anixter in Anixter;
(ix) Investments by Anixter in any Subsidiary of Anixter that is not a Loan Party (other than ARC), in each case so long as (A) no Event of Default exists or would result therefrom, and (B) after giving effect to the proposed Investment as if it occurred on the first day of the Pro Forma Period, pro forma Combined Availability would be greater than 15% of the Combined Commitment at all times during the Pro Forma Period;
(x) Investments constituting loans permitted by clause (iv) of Section 6.1(a) or Accommodation Obligations permitted under Section 6.4(b) ; and
(xi) Investments in the form of Swap Agreements permitted by Section 6.7 ;
(xii) investments of any Person existing at the time such Person becomes a Subsidiary of Anixter or consolidates or merges with Anixter or any of its Subsidiaries (including in connection with an acquisition permitted by Section 6.4(a)(v) ) so long as such investments were not made in contemplation of such Person becoming a Subsidiary or of such merger;
(xiii) investments constituting deposits described in clause (c) of the definition of the term “Customary Permitted Liens”;
(xiv) Investments constituting Accommodation Obligations permitted by Section 6.4(b) ; and
(xv) Investments by any non-Loan Party in any other non-Loan Party.
 
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(b) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, directly or indirectly, create or become or be liable with respect to any Accommodation Obligation involving Indebtedness of AXE or any Affiliate of AXE which is not a Subsidiary of Anixter. In addition, No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, directly or indirectly, create or become or be liable with respect to any Accommodation Obligation except:
(i) guaranties resulting from endorsement of negotiable instruments for collection in the ordinary course of business;
(ii) Accommodation Obligations arising in connection with the Related Transactions Documents;
(iii) Accommodation Obligations by Anixter with respect to lessees’ obligations to third-party lessors under leases of Property purchased from Anixter and its Subsidiaries, in an aggregate amount not to exceed $10,000,000;
(iv) Accommodation Obligations of Anixter and its Subsidiaries arising in connection with Swap Agreements permitted by Section 6.7 ;
(v) Accommodation Obligations of Anixter and its Subsidiaries of Indebtedness permitted by Section 6.1(a) ; and
(vi) other Accommodation Obligations by Anixter and its Subsidiaries, so long as (A) the aggregate amount of Indebtedness outstanding in respect of which such Accommodation Obligations have been given does not at any time exceed $175,000,000, and (B) the Payment Conditions are satisfied; provided , however, that no such Accommodation Obligations shall be entered into or incurred after the occurrence and during the continuance of an Event of Default.
6.5 Asset Sales .
(a) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, sell, transfer, lease, or otherwise Dispose of any asset, including any Equity Interest owned by it, or any income or profits therefrom, except:
(i) sales, transfers and dispositions of (A) Inventory in the ordinary course of business and (B) disposition of obsolete equipment in the ordinary course of business;
(ii) sales by Anixter of Equity Interests of a Subsidiary held by it, in any transaction or series of related transactions not constituting a Material Transaction, individually or taken together;
(iii) sales, assignments, transfers, leases, conveyances or other dispositions of other assets, other than Equity Interests of any Subsidiary, for cash consideration and for not less than fair market value which do not constitute a Material Transaction individually or in the aggregate (together with all sales of Equity Interests of any Subsidiary under clause (ii) above);
 
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(iv) sales, assignments, transfers, leases, conveyances or other Dispositions of assets to Anixter or a Subsidiary of Anixter that is a Loan Party;
(v) transfers of assets to any Affiliate for less than fair market value to the extent such transfer constitutes a permitted Investment pursuant to Section 6.4(a) ;
(vi) Receivables Facility Transactions;
(vii) sales, assignments, transfers, leases, conveyances, and other Dispositions among Foreign Subsidiaries; and
(viii) Sale and Leaseback Transactions permitted by Section 6.6 .
(b) Notwithstanding anything to the contrary contained in Section 6.5(a) , Anixter will not, and will not permit any of its applicable Subsidiaries to, Dispose of any assets (whether in a Material Transaction or otherwise) if, after giving effect to such Disposition, the pro forma Secured Debt-to-CTNA Ratio would be 10% or greater. No later than five (5) Business Days prior to any proposed Disposition of assets, Anixter will furnish (or will caused to be furnished) to Administrative Agent and each Lender written notice of such proposed Disposition and a certificate of a Financial Officer of Anixter certifying compliance with this Section 6.5(b) and attaching pro forma computations of the Secured Debt-to-CTNA Ratio before and after giving effect to such proposed Disposition.
(c) Notwithstanding anything to the contrary contained in this Agreement (including in Section 6.5(a) ), Anixter will not, and will not permit any of its applicable Subsidiaries to, effect a material voluntary accounting writedown of assets included in Consolidated Tangible Net Assets if, after giving effect to such voluntary accounting writedown, the pro forma Secured Debt-to-CTNA Ratio would be 10% or greater. No later than five (5) Business Days prior to any proposed material voluntary accounting writedown of assets included in Consolidated Tangible Net Assets, Anixter will furnish (or will caused to be furnished) to Administrative Agent and each Lender written notice of such proposed voluntary accounting writedown and a certificate of a Financial Officer of Anixter certifying compliance with this Section 6.5(c) and attaching pro forma computations of the Secured Debt-to-CTNA Ratio before and after giving effect to such proposed voluntary accounting writedown.
6.6 Sale and Leaseback Transactions . No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, enter into any arrangement, directly or indirectly, whereby it shall sell or transfer any property, real or personal, used or useful in its business, whether now owned or hereafter acquired, and thereafter rent or lease such property or other property that it intends to use for substantially the same purpose or purposes as the property sold or transferred (a “ Sale and Leaseback Transaction ”), except for any such sale of any fixed or capital assets by Anixter or any Subsidiary that is made for cash consideration in an amount not less than the fair value of such fixed or capital asset and is consummated within 365 days after Anixter or such Subsidiary acquires or completes the construction of such fixed or capital asset.
6.7 Swap Agreements . No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, enter into any Swap Agreement, except (a) Swap Agreements entered into to hedge or mitigate risks to which such Person has actual exposure (other than those in respect of Equity Interests of any Subsidiary), and (b) Swap Agreements entered into in order to effectively cap, collar or exchange interest rates (from floating to fixed rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment of such Person.
 
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6.8 Payments to AXE; Certain Payments of Indebtedness .
(a) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, declare or make, directly or indirectly, make any payment, distribution or contribution to or investment in AXE (whether in cash or otherwise), except:
(i) Anixter and its Subsidiaries may declare and make payments to AXE so that AXE may pay any directors’ fees and reasonable allocated expenses in an aggregate amount not to exceed $7,500,000 during any Fiscal Year;
(ii) Anixter and its Subsidiaries may make payments to AXE (A) that are applied by AXE to pay its actual income tax liabilities in respect of income earned by Anixter and its Subsidiaries, or (B) that are applied by AXE to make any cash settlements to management or employees under equity awards consistent with its past practice not in excess of $7,500,000 in the aggregate during any calendar year; and
(iii) Anixter and its Subsidiaries may make any other payment, distribution or contribution to or investment in AXE (whether in cash or otherwise), in each case so long as (A) no Event of Default exists or would result therefrom, and (B) the Payment Conditions are satisfied.
(b) No Loan Party will, and Anixter will not permit any Loan Party to, make or agree to pay or make, directly or indirectly, any payment or other distribution (whether in cash, securities or other property) of or in respect of principal of or interest on any Indebtedness, or any payment or other distribution (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Indebtedness, except:
(i) payment of Indebtedness created under the Loan Documents;
(ii) (A) payments of interest and principal (including prepayments) in respect of the Indebtedness under the Receivables Facility and permitted under clause (viii) of Section 6.1(a) , (B) payments of interest and principal (including prepayments) by ARC to Anixter in respect of the Indebtedness of ARC to Anixter arising under Receivables Facility Transactions and permitted under clause (iv)(A) of Section 6.1(a) , and (C) payment of regularly scheduled interest and principal payments as and when due in respect of any other Indebtedness permitted under Section 6.1 , other than payments in respect of the Subordinated Indebtedness prohibited by the subordination provisions thereof;
(iii) refinancings of Indebtedness to the extent permitted by Section 6.1 ;
(iv) payment of secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness to the extent such sale or transfer is permitted by the terms of Section 6.5 ; and
(v) any other payments in respect of any Indebtedness, in each case so long as (A) no Event of Default exists or would result therefrom, and (B) the Payment Conditions are satisfied.
 
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6.9 Transactions with Affiliates . No Loan Party will, and Anixter will not permit any Loan Party to, directly or indirectly enter into or permit to exist any transaction (including, without limitation, any sale, lease, or other transfer of any property or assets, any purchase, lease, or other acquisition of any property or assets, or the rendering of any service) with any Affiliate of Anixter that is not a Loan Party that involves one or more payments to such Affiliate in excess of $5,000,000 for any single transaction or series of related transactions on terms that are less favorable to it than those fair and reasonable terms that might be obtained in a comparable arms-length transaction at the time (other than payments to AXE permitted pursuant to Section 6.8(a) ); provided that the foregoing shall not restrict transactions among Foreign Subsidiaries.
6.10 Restrictive Agreements . No Loan Party will, and Anixter will not permit any Loan Party to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of such Person to create, incur, or permit to exist any Lien upon any of its property or assets, or (b) the ability of any Subsidiary of Anixter to pay dividends or other distributions with respect to any of its Equity Interests or to make or repay loans or advances to Anixter or any other Subsidiary or to guarantee Indebtedness of Anixter or any other Subsidiary; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by any Requirement of Law or by any Loan Document, (ii) the foregoing shall not apply to restrictions and conditions existing on the date hereof identified on Schedule 6.10 (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided that such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iv)  clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, and (v)  clause (a) of the foregoing shall not apply to customary provisions in leases and other contracts restricting the assignment thereof.
6.11 Amendment of Material Documents .
(a) No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, amend, modify or waive any of its rights under (i) any agreement relating to any Subordinated Indebtedness, (ii) the Revolving Subordinated Note, or (iii) the HD Supply Acquisition Agreement, in each case without five (5) Business Days’ prior written notice or to the extent any such amendment, modification, or waiver would be adverse to the Lenders.
(b) Notwithstanding anything to the contrary contained in this Section 6.11 , none of the Loan Parties will, amend, modify or waive any of its rights under (i) its Organization Documents or (ii) any Receivables Facility Transaction Documents, in each case, without five (5) Business Days’ prior written notice or to the extent any such amendment, modification or waiver would impair its ability to comply with the terms or provisions of any of the Receivables Facility Loan Documents, including Section 6.19 of the Receivables Facility Credit Agreement, or any of the Receivables Facility Transaction Documents as in effect on the Closing Date.
 
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6.12 Employee Benefit Matters . No Loan Party will, and Anixter will not permit any ERISA Affiliates (including ARC) to, do any of the following which, individually, or in the aggregate, could reasonably be expected to result in a Material Adverse Effect:
(a) engage in any prohibited transaction described in Section 406 of ERISA or 4975 of the IRC for which a statutory or class exemption is not available or a private exemption has not been previously obtained from the U.S. Department of Labor;
(b) permit any failure to make “minimum required contributions” (as defined in Sections 302 of ERISA and 412 of the IRC), whether or not waived;
(c) fail to pay timely required contributions or annual installments due with respect to any waived funding deficiency to any Benefit Plan;
(d) terminate any Benefit Plan in a distress termination under Section 4041(c) of ERISA which would result in any liability to Anixter or any ERISA Affiliates;
(e) fail to make any contribution or payment to any Multiemployer Plan which Anixter or any ERISA Affiliates may be required to make under any agreement relating to such Multiemployer Plan, or any law pertaining thereto;
(f) fail to pay any required installment or any other payment required under Section 412 or 430 of the IRC on or before the due date for such installment or other payment;
(g) amend a Plan resulting in an increase in the “adjusted funding target attainment percentage” (as defined in Section 436 of the IRC) for the plan year such that Anixter or any ERISA Affiliates is required to provide security to such Plan under Section 436 of the IRC;
(h) permit any unfunded liabilities with respect to any Foreign Pension Plan to exist; or
(i) fail to pay any required contribution or payment to a Foreign Pension Plan on or before the date for such required installment or payment.
6.13 Environmental Liabilities . No Loan Party will, and Anixter will not permit any member of the Consolidated Group to, become subject to any Environmental Liability which could reasonably be expected to result in a Material Adverse Effect.
6.14 Minimum Fixed Charge Coverage Ratio . Anixter will not permit the Consolidated Fixed Charge Coverage Ratio, calculated as of the end of any Fiscal Quarter for the period of four Fiscal Quarters then most recently ended, commencing on the date that a Financial Covenant Trigger Period first begins and measured as of the end of the Fiscal Quarter ending immediately preceding the date on which such Financial Covenant Trigger Period first began and as of the end of each Fiscal Quarter thereafter during such Financial Covenant Trigger Period, to be less than 1.0 to 1.0. The Consolidated Fixed Charge Coverage Ratio will be calculated after the elimination of the minority interest in any Subsidiaries that are not wholly owned Subsidiaries.
 
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6.15 Inventory with Bailees . Each Borrower will not, and will not permit any other Loan Party to, store its Inventory at any time with a bailee, warehouseman, consignee, or similar party, unless such bailee, warehouseman, consignee, or similar party has provided Administrative Agent a Collateral Access Agreement in form and substance satisfactory to Administrative Agent.
7. [Reserved].
8. EVENTS OF DEFAULT .
Any one or more of the following events shall constitute an event of default (each, an “ Event of Default ”) under this Agreement:
(a) any Borrower shall fail to pay any principal of any Obligation when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;
(b) any Borrower shall fail to pay any interest on any Obligation or any fee or any other amount (other than an amount referred to in clause (a) of this Section 8 ) payable under this Agreement or any other Loan Document, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three (3) Business Days;
(c) any representation or warranty made or deemed made by or on behalf of any Loan Party, Anixter, or any of their respective Subsidiaries in, or in connection with, this Agreement, any other Loan Document, or any Receivables Facility Transaction Document, or any amendment or modification hereof or thereof or waiver hereunder or thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement, any other Loan Document, or any Receivables Facility Transaction Document, or any amendment or modification hereof or thereof or waiver hereunder or thereunder, shall prove to have been false or misleading in any material respect (or, if such representation or warranty is already qualified or modified by materiality in the text thereof, in any respect) when made or deemed made;
(d) any Loan Party, Anixter, or any of their respective Subsidiaries shall fail to observe or perform any covenant, condition, or agreement contained in Section 5.1 (other than clauses (b) (but only with respect to the last Fiscal Quarter of a Fiscal Year), (i) , (j) , (l) , and (m) ), 5.2(a) , 5.3 (with respect to a Loan Party’s existence), 5.8 , or 5.10 or in Section 6 (other than Section 6.12 );
(e) (i) any Loan Party, Anixter, or any of their respective Subsidiaries shall fail to observe or perform any covenant, condition or agreement contained in Section 5.1(b) (but only with respect to the last Fiscal Quarter of a Fiscal Year), 5.1(j) , 5.1(l) , 5.1(m) , 5.2 (other than clause (a) ), 5.3 (other than with respect to a Loan Party’s existence), 5.4 , 5.5 , 5.6 (solely if Anixter of any its Subsidiaries refuses to permit any representative designated by the Administrative Agent or any Lender to visit and inspect such Person’s properties, to conduct at such Person’s premises field examinations of such Person’s assets, liabilities, books and records, including examining and making extracts from its books and records, environmental assessment reports, and to discuss its affairs, finances and condition with its officers and independent accountants, in each case subject to and in accordance with Section 5.6 ), 5.7 , or 5.14 , and such failure shall continue unremedied for a period of fifteen (15) days after the earlier of knowledge of such breach by any Loan Party, Anixter, or any of their respective Subsidiaries or notice
 
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thereof from Administrative Agent (which notice will be given at the request of any Lender); provided that, with respect to Section 5.1(b) as set forth in this clause (i) , the grace period shall be the shorter of fifteen (15) days and the date such deliveries required thereunder were delivered or required to be delivered to the SEC; or (ii) any Loan Party, Anixter, or any of their respective Subsidiaries shall fail to observe or perform any covenant, condition or agreement contained in this Agreement or any other Loan Document (unless a specific cure and/or grace period relating to such covenant, condition or agreement is referenced in such Loan Document) or any Receivables Facility Transaction Document (other than those which constitute a default under another clause of this Section 8 ), and such failure shall continue unremedied for a period of thirty (30) days after the earlier of knowledge of such breach by any Loan Party, Anixter, or any of their respective Subsidiaries or notice thereof from Administrative Agent (which notice will be given at the request of any Lender);
(f) AXE, Anixter or any Subsidiary of Anixter shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness when and as the same shall become due and payable (beyond any applicable grace period);
(g) (i) any “Amortization Event” occurs under the Receivables Facility Credit Agreement; or (ii) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof;
(h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of any Loan Party, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 or any such Person’s debts, or of a substantial part of any such Person’s assets, under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Loan Party, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 or for a substantial part of any such Person’s assets, and, in any such case, such proceeding or petition shall continue undismissed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall be entered;
(i) any Loan Party, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Section 8 , (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for such Person or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors, or (vi) take any action for the purpose of effecting any of the foregoing;
(j) any Loan Party, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 shall become unable, admit in writing its inability, or publicly declare its intention not to, or fail generally to pay its debts as they become due;
 
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(k) (i) an Enforceable Judgment (other than an Enforceable Judgment described in the proviso contained in the definition of the term “Enforceable Judgment”) for the payment of money in excess of $35,000,000 shall be rendered against Anixter, any Subsidiary of Anixter, or any combination thereof and the same shall remain undischarged for a period of thirty (30) consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to enforce any such Enforceable Judgment; or (ii) any Enforceable Judgment described in the proviso contained in the definition of the term “Enforceable Judgment” shall be rendered against any Borrower;
(l) any order, judgment, or decree shall be entered against any Loan Party, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 decreeing its involuntary dissolution or split-up and such order shall remain undischarged and unstayed for a period in excess of thirty (30) days, or any Loan Party, AXE, Anixter, or any Subsidiary of Anixter with assets in excess of $35,000,000 shall otherwise dissolve or cease to exist, in each case except as expressly permitted pursuant to Section 6.3(a) or 6.3(b) ;
(m) (i) any one or more Termination Events occur which could reasonably be expected to subject Anixter or an ERISA Affiliate to a liability to pay more than $75,000,000 in the aggregate, or (A) the plan administrator of any Plan applies under Section 412(c) of the IRC for a waiver of the minimum funding standards of Section 412(a) of the IRC and the substantial business hardship upon which the application for the waiver is based could reasonably be expected to subject either Anixter or any ERISA Affiliate to a liability of more than $75,000,000 in the aggregate;
(n) (i) a Change in Control shall occur, (ii) Anixter shall cease to own directly or indirectly all of the capital stock of each other Borrower (other than director’s qualifying shares); (iii) except as permitted in Section 6.5(a) , Anixter shall cease to own directly or indirectly at least 51% of the outstanding stock of each class of the capital stock of each Subsidiary of Anixter; or (iv) AXE shall cease to own at least 51% of the outstanding stock of each class of the capital stock of Anixter;
(o) any breach or other violation by any holder of the Revolving Subordinated Note of the subordination or enforcement restrictions applicable thereto shall occur;
(p) the guaranty provisions of the Guaranty and Security Agreement or any other guarantee of the Obligations shall fail to remain in full force or effect or any action shall be taken to discontinue or to assert the invalidity or unenforceability of the guaranty provisions of the Guaranty and Security Agreement or any other guarantee of the Obligations, or any Guarantor shall fail to comply with the guaranty provisions of the Guaranty and Security Agreement or any other guarantee of the Obligations to which it is a party, or any Guarantor shall deny that it has any further liability under the guaranty provisions of the Guaranty and Security Agreement or any other guaranty of the Obligations to which it is a party, or shall give notice to such effect;
(q) except as permitted by the terms of this Agreement, any Collateral Document, or the Intercreditor Agreement, (i) any Collateral Document shall for any reason fail to create a valid security interest in any Collateral with a value of $1,000,000 or greater in the aggregate purported to be covered thereby, or (ii) any Lien securing any Obligation shall cease to be a perfected, first-priority Lien;
(r) any Collateral Document shall fail to remain in full force or effect or any action shall be taken to discontinue or to assert the invalidity or unenforceability of any Collateral Document;
 
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(s) any material provision of any Loan Document or any Receivables Facility Transaction Document for any reason ceases to be valid, binding and enforceable in accordance with its terms (or any Person party thereto shall challenge the enforceability of any Loan Document or any Receivables Facility Transaction Document or shall assert in writing, or engage in any action or inaction that evidences its assertion, that any provision of any of the Loan Documents or any of the Receivables Facility Transaction Documents has ceased to be or otherwise is not valid, binding and enforceable in accordance with its terms);
(t) the Indebtedness evidenced by the 5.625% Senior Notes due 2019 issued under the 2012 Notes Indenture is not repaid in full or refinanced or replaced on terms mutually satisfactory to Anixter and Administrative Agent (including, as to any Indebtedness refinancing or replacing such notes, such Indebtedness having a maturity date not earlier than ninety (90) days after the Maturity Date) by January 31, 2019, which is the date that is ninety (90) days before the stated maturity date of such notes as of the Closing Date; or
(u) any requirement arises under the 2012 Notes Indenture to grant liens upon any Collateral to secure any Indebtedness issued under the 2012 Notes Indenture.
9. RIGHTS AND REMEDIES .
9.1 Rights and Remedies . Upon the occurrence and during the continuation of an Event of Default, Administrative Agent may, and, at the instruction of the Required Lenders, shall (in each case under clauses (a)  or (b)  by written notice to Borrowers), in addition to any other rights or remedies provided for hereunder or under any other Loan Document or by applicable law, do any one or more of the following:
(a) (i) declare the principal of, and any and all accrued and unpaid interest and fees in respect of, the Loans and all other Obligations (other than the Bank Product Obligations), whether evidenced by this Agreement or by any of the other Loan Documents to be immediately due and payable, whereupon the same shall become and be immediately due and payable and Borrowers shall be obligated to repay all of such Obligations in full, without presentment, demand, protest, or further notice or other requirements of any kind, all of which are hereby expressly waived by each Borrower, and (A) direct Borrowers to provide (and Borrowers agree that upon receipt of such notice Borrowers will provide) Letter of Credit Collateralization to Administrative Agent to be held as security for Borrowers’ reimbursement obligations for drawings that may subsequently occur under issued and outstanding Letters of Credit;
(b) declare the Commitments terminated, whereupon the Commitments shall immediately be terminated together with (i) any obligation of any Revolving Lender to make Revolving Loans, (ii) the obligation of the Swing Lender to make Swing Loans, and (iii) the obligation of Issuing Bank to issue Letters of Credit; and
(c) exercise all other rights and remedies available to Administrative Agent or the Lenders under the Loan Documents, under applicable law, or in equity.
The foregoing to the contrary notwithstanding, upon the occurrence of any Event of Default described in clauses (h) or (i)  of Section 8 , in addition to the remedies set forth above, without any notice to Borrowers or any other Person or any act by the Lender Group, the Commitments shall automatically terminate and
 
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the Obligations (other than the Bank Product Obligations), inclusive of the principal of, and any and all accrued and unpaid interest and fees in respect of, the Loans and all other Obligations (other than the Bank Product Obligations), whether evidenced by this Agreement or by any of the other Loan Documents, shall automatically become and be immediately due and payable and Borrowers shall automatically be obligated to repay all of such Obligations in full (including Borrowers being obligated to provide (and Borrowers agree that they will provide) (1) Letter of Credit Collateralization to Administrative Agent to be held as security for Borrowers’ reimbursement obligations in respect of drawings that may subsequently occur under issued and outstanding Letters of Credit and (2) Bank Product Collateralization to be held as security for Borrowers’ or their Subsidiaries’ obligations in respect of outstanding Bank Products), without presentment, demand, protest, or notice or other requirements of any kind, all of which are expressly waived by Borrowers.
9.2 Remedies Cumulative . The rights and remedies of the Lender Group under this Agreement, the other Loan Documents, and all other agreements shall be cumulative. The Lender Group shall have all other rights and remedies not inconsistent herewith as provided under the Code, by law, or in equity. No exercise by the Lender Group of one right or remedy shall be deemed an election, and no waiver by the Lender Group of any Event of Default shall be deemed a continuing waiver. No delay by the Lender Group shall constitute a waiver, election, or acquiescence by it.
10. WAIVERS; INDEMNIFICATION .
10.1 Demand; Protest; etc . Each Borrower waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and nonpayment, nonpayment at maturity, release, compromise, settlement, extension, or renewal of documents, instruments, chattel paper, and guarantees at any time held by the Lender Group on which any Borrower may in any way be liable.
10.2 The Lender Group’s Liability for Collateral . Each Borrower hereby agrees that: (a) so long as Administrative Agent complies with its obligations, if any, under the Code, the Lender Group shall not in any way or manner be liable or responsible for: (i) the safekeeping of the Collateral, (ii) any loss or damage thereto occurring or arising in any manner or fashion from any cause, (iii) any diminution in the value thereof, or (iv) any act or default of any carrier, warehouseman, bailee, forwarding agency, or other Person, and (b) all risk of loss, damage, or destruction of the Collateral shall be borne by Borrowers.
10.3 Indemnification . Each Borrower shall pay, indemnify, defend, and hold Administrative Agent-Related Persons, the Lender-Related Persons, and each Participant (each, an “ Indemnified Person ”) harmless (to the fullest extent permitted by law) from and against any and all claims, demands, suits, actions, investigations, proceedings, liabilities, fines, costs, penalties, and damages, and all reasonable fees and disbursements of attorneys, experts, or consultants and all other costs and expenses actually incurred in connection therewith or in connection with the enforcement of this indemnification (as and when they are incurred and irrespective of whether suit is brought), at any time asserted against, imposed upon, or incurred by any of them (a) in connection with or as a result of or related to the execution and delivery (provided that Borrowers shall not be liable for costs and expenses (including attorneys’ fees) of any Lender (other than Wells Fargo) incurred in advising, structuring, drafting, reviewing, administering or syndicating the Loan Documents), enforcement, performance, or administration (including any restructuring or workout with respect hereto) of this Agreement, any of the other Loan Documents, or the transactions contemplated hereby or thereby or the monitoring of the Loan Parties’ and their Subsidiaries’ compliance with the terms of the Loan Documents ( provided , that the indemnification in this
 
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clause (a)  shall not extend to (i) disputes solely between or among the Lenders that do not involve any acts or omissions of any Loan Party, or (ii) disputes solely between or among the Lenders and their respective Affiliates that do not involve any acts or omissions of any Loan Party; it being understood and agreed that the indemnification in this clause (a)  shall extend to Administrative Agent (but not the Lenders) relative to disputes between or among Administrative Agent, in its capacity as such, on the one hand, and one or more Lenders, or one or more of their Affiliates, on the other hand, or (iii) any Taxes or any costs attributable to Taxes, which shall be governed by Section 16 ), (b) with respect to any actual or prospective investigation, litigation, or proceeding related to this Agreement, any other Loan Document, the making of any Loans or issuance of any Letters of Credit hereunder, or the use of the proceeds of the Loans or the Letters of Credit provided hereunder (irrespective of whether any Indemnified Person is a party thereto), or any act, omission, event, or circumstance in any manner related thereto, and (c) in connection with or arising out of any presence or release of Hazardous Materials at, on, under, to or from any assets or properties owned, leased or operated by any Borrower or any of its Subsidiaries or any Environmental Liabilities or remedial actions under or in respect of Environmental Laws related in any way to any such assets or properties of any Borrower or any of its Subsidiaries (each and all of the foregoing, the “ Indemnified Liabilities ”). The foregoing to the contrary notwithstanding, no Borrower shall have any obligation to any Indemnified Person under this Section 10.3 with respect to any Indemnified Liability that a court of competent jurisdiction finally determines to have resulted from the gross negligence or willful misconduct of such Indemnified Person or its officers, directors, employees, attorneys, or agents. This provision shall survive the termination of this Agreement and the repayment in full of the Obligations. If any Indemnified Person makes any payment to any other Indemnified Person with respect to an Indemnified Liability as to which Borrowers were required to indemnify the Indemnified Person receiving such payment, the Indemnified Person making such payment is entitled to be indemnified and reimbursed by Borrowers with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON .
11. NOTICES .
Unless otherwise provided in this Agreement, all notices or demands relating to this Agreement or any other Loan Document shall be in writing and (except for financial statements and other informational documents which may be sent by first-class mail, postage prepaid) shall be personally delivered or sent by registered or certified mail (postage prepaid, return receipt requested), overnight courier, electronic mail (at such email addresses as a party may designate in accordance herewith), or telefacsimile. In the case of notices or demands to any Borrower or Administrative Agent, as the case may be, they shall be sent to the respective address set forth below:

If to any Borrower:	  	Anixter Inc.	
	  	2301 Patriot Boulevard	
	  	Glenview, Illinois 60026	
	  	Attn: David Johnson	
	  	Fax No.: (224) 521-8990	
 
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with copies to:	  	Schiff Hardin LLP	
	  	233 South Wacker Drive, Suite 6600	
	  	Chicago, Illinois 60606-6473	
	  	Attn: Kevin C. Knohl	
	  	Fax No.: (312) 258-5600	
		
If to Administrative Agent:	  	Wells Fargo Bank, National Association	
	  	10 South Wacker Drive, 13th Floor	
	  	MAC N8405-131	
	  	Chicago, Illinois 60606	
	  	Attn: Loan Portfolio Manager (Anixter)	
	  	Fax No.: (312) 332-0424	
		
with copies to:	  	McGuireWoods LLP	
	  	77 West Wacker Drive, Suite 4100	
	  	Chicago, Illinois 60601	
	  	Attn: Philip J. Perzek	
	  	Fax No.: (312) 698-4555	
Any party hereto may change the address at which they are to receive notices hereunder, by notice in writing in the foregoing manner given to the other party. All notices or demands sent in accordance with this Section 11 , shall be deemed received on the earlier of the date of actual receipt or 3 Business Days after the deposit thereof in the mail; provided , that (a) notices sent by overnight courier service shall be deemed to have been given when received, (b) notices by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient) and (c) notices by electronic mail shall be deemed received upon the sender’s receipt of an acknowledgment from the intended recipient (such as by the “return receipt requested” function, as available, return email or other written acknowledgment).
12. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER; JUDICIAL REFERENCE PROVISION .
(a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO, AND ANY CLAIMS, CONTROVERSIES OR DISPUTES ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS .
(b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE
 
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COUNTY OF COOK, STATE OF ILLINOIS; PROVIDED , THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT ADMINISTRATIVE AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE ADMINISTRATIVE AGENT ELECTS TO BRING SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH BORROWER AND EACH MEMBER OF THE LENDER GROUP WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 12(b) .
(c) TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH BORROWER AND EACH MEMBER OF THE LENDER GROUP HEREBY WAIVE THEIR RESPECTIVE RIGHTS, IF ANY, TO A JURY TRIAL OF ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION DIRECTLY OR INDIRECTLY BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS (EACH A “ CLAIM ”) . EACH BORROWER AND EACH MEMBER OF THE LENDER GROUP REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL . IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT .
(d) EACH BORROWER AND EACH MEMBER OF THE LENDER GROUP HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF COOK AND THE STATE OF ILLINOIS, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENTS, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT . EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW . NOTHING IN THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT ADMINISTRATIVE AGENT MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION .
(e) NO CLAIM MAY BE MADE (i) BY ANY LOAN PARTY AGAINST ADMINISTRATIVE AGENT, THE SWING LENDER, ANY OTHER LENDER, ISSUING BANK, OR ANY AFFILIATE, DIRECTOR, OFFICER, EMPLOYEE, COUNSEL, REPRESENTATIVE, AGENT, OR ATTORNEY-IN-FACT OF ANY OF THEM, OR (ii) BY ANY MEMBER OF THE LENDER GROUP AGAINST ANY LOAN PARTY OR ANY AFFILIATE, DIRECTOR, OFFICER, EMPLOYEE, COUNSEL, REPRESENTATIVE, AGENT, OR ATTORNEY-IN-FACT OF ANY OF THEM, IN EACH CASE FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, PUNITIVE OR EXEMPLARY DAMAGES OR LOSSES IN RESPECT OF ANY CLAIM FOR BREACH OF
 
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CONTRACT OR ANY OTHER THEORY OF LIABILITY ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY ACT, OMISSION, OR EVENT OCCURRING IN CONNECTION THEREWITH, AND EACH LOAN PARTY AND EACH MEMBER OF THE LENDER GROUP HEREBY WAIVES, RELEASES, AND AGREES NOT TO SUE UPON ANY CLAIM FOR SUCH DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR .
(f) IN THE EVENT ANY LEGAL PROCEEDING IS FILED IN A COURT OF THE STATE OF CALIFORNIA (THE “ COURT ”) BY OR AGAINST ANY PARTY HERETO IN CONNECTION WITH ANY CLAIM AND THE WAIVER SET FORTH IN CLAUSE (c)  ABOVE IS NOT ENFORCEABLE IN SUCH PROCEEDING, THE PARTIES HERETO AGREE AS FOLLOWS:
(i) WITH THE EXCEPTION OF THE MATTERS SPECIFIED IN SUBCLAUSE (ii)  BELOW, ANY CLAIM SHALL BE DETERMINED BY A GENERAL REFERENCE PROCEEDING IN ACCORDANCE WITH THE PROVISIONS OF CALIFORNIA CODE OF CIVIL PROCEDURE SECTIONS 638 THROUGH 645.1. THE PARTIES INTEND THIS GENERAL REFERENCE AGREEMENT TO BE SPECIFICALLY ENFORCEABLE. VENUE FOR THE REFERENCE PROCEEDING SHALL BE IN THE COUNTY OF LOS ANGELES, CALIFORNIA .
(ii) THE FOLLOWING MATTERS SHALL NOT BE SUBJECT TO A GENERAL REFERENCE PROCEEDING: (A) NON-JUDICIAL FORECLOSURE OF ANY SECURITY INTERESTS IN REAL OR PERSONAL PROPERTY, (B) EXERCISE OF SELF-HELP REMEDIES (INCLUDING SET-OFF OR RECOUPMENT), (C) APPOINTMENT OF A RECEIVER, AND (D) TEMPORARY, PROVISIONAL, OR ANCILLARY REMEDIES (INCLUDING WRITS OF ATTACHMENT, WRITS OF POSSESSION, TEMPORARY RESTRAINING ORDERS, OR PRELIMINARY INJUNCTIONS) . THIS AGREEMENT DOES NOT LIMIT THE RIGHT OF ANY PARTY TO EXERCISE OR OPPOSE ANY OF THE RIGHTS AND REMEDIES DESCRIBED IN CLAUSES (A)  THROUGH (D)  AND ANY SUCH EXERCISE OR OPPOSITION DOES NOT WAIVE THE RIGHT OF ANY PARTY TO PARTICIPATE IN A REFERENCE PROCEEDING PURSUANT TO THIS AGREEMENT WITH RESPECT TO ANY OTHER MATTER .
(iii) UPON THE WRITTEN REQUEST OF ANY PARTY, THE PARTIES SHALL SELECT A SINGLE REFEREE, WHO SHALL BE A RETIRED JUDGE OR JUSTICE . IF THE PARTIES DO NOT AGREE UPON A REFEREE WITHIN 10 DAYS OF SUCH WRITTEN REQUEST, THEN, ANY PARTY SHALL HAVE THE RIGHT TO REQUEST THE COURT TO APPOINT A REFEREE PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 640(B) . THE REFEREE SHALL BE APPOINTED TO SIT WITH ALL OF THE POWERS PROVIDED BY LAW . PENDING APPOINTMENT OF THE REFEREE, THE COURT SHALL HAVE THE POWER TO ISSUE TEMPORARY OR PROVISIONAL REMEDIES .
(iv) EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE REFEREE SHALL DETERMINE THE MANNER IN WHICH THE REFERENCE
 
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PROCEEDING IS CONDUCTED INCLUDING THE TIME AND PLACE OF HEARINGS, THE ORDER OF PRESENTATION OF EVIDENCE, AND ALL OTHER QUESTIONS THAT ARISE WITH RESPECT TO THE COURSE OF THE REFERENCE PROCEEDING . ALL PROCEEDINGS AND HEARINGS CONDUCTED BEFORE THE REFEREE, EXCEPT FOR TRIAL, SHALL BE CONDUCTED WITHOUT A COURT REPORTER, EXCEPT WHEN ANY PARTY SO REQUESTS A COURT REPORTER AND A TRANSCRIPT IS ORDERED, A COURT REPORTER SHALL BE USED AND THE REFEREE SHALL BE PROVIDED A COURTESY COPY OF THE TRANSCRIPT . THE PARTY MAKING SUCH REQUEST SHALL HAVE THE OBLIGATION TO ARRANGE FOR AND PAY THE COSTS OF THE COURT REPORTER, PROVIDED THAT SUCH COSTS, ALONG WITH THE REFEREE’S FEES, SHALL ULTIMATELY BE BORNE BY THE PARTY WHO DOES NOT PREVAIL, AS DETERMINED BY THE REFEREE .
(v) THE REFEREE MAY REQUIRE ONE OR MORE PREHEARING CONFERENCES . THE PARTIES HERETO SHALL BE ENTITLED TO DISCOVERY, AND THE REFEREE SHALL OVERSEE DISCOVERY IN ACCORDANCE WITH THE RULES OF DISCOVERY, AND SHALL ENFORCE ALL DISCOVERY ORDERS IN THE SAME MANNER AS ANY TRIAL COURT JUDGE IN PROCEEDINGS AT LAW IN THE STATE OF CALIFORNIA .
(vi) THE REFEREE SHALL APPLY THE RULES OF EVIDENCE APPLICABLE TO PROCEEDINGS AT LAW IN THE STATE OF CALIFORNIA AND SHALL DETERMINE ALL ISSUES IN ACCORDANCE WITH CALIFORNIA SUBSTANTIVE AND PROCEDURAL LAW . THE REFEREE SHALL BE EMPOWERED TO ENTER EQUITABLE AS WELL AS LEGAL RELIEF AND RULE ON ANY MOTION WHICH WOULD BE AUTHORIZED IN A TRIAL, INCLUDING MOTIONS FOR DEFAULT JUDGMENT OR SUMMARY JUDGMENT . THE REFEREE SHALL REPORT HIS OR HER DECISION, WHICH REPORT SHALL ALSO INCLUDE FINDINGS OF FACT AND CONCLUSIONS OF LAW . THE REFEREE SHALL ISSUE A DECISION AND PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE, SECTION 644, THE REFEREE’S DECISION SHALL BE ENTERED BY THE COURT AS A JUDGMENT IN THE SAME MANNER AS IF THE ACTION HAD BEEN TRIED BY THE COURT . THE FINAL JUDGMENT OR ORDER FROM ANY APPEALABLE DECISION OR ORDER ENTERED BY THE REFEREE SHALL BE FULLY APPEALABLE AS IF IT HAS BEEN ENTERED BY THE COURT .
(vii) THE PARTIES RECOGNIZE AND AGREE THAT ALL CLAIMS RESOLVED IN A GENERAL REFERENCE PROCEEDING PURSUANT HERETO WILL BE DECIDED BY A REFEREE AND NOT BY A JURY . AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR OWN CHOICE, EACH PARTY HERETO KNOWINGLY AND VOLUNTARILY AND FOR THEIR MUTUAL BENEFIT AGREES THAT THIS REFERENCE PROVISION SHALL APPLY TO ANY DISPUTE BETWEEN THEM THAT ARISES OUT OF OR IS RELATED TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS .
 
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13. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS .
13.1 Assignments and Participations .
(a) (i) Subject to the conditions set forth in clause (a)(ii)  below, any Lender may assign and delegate all or any portion of its rights and duties under the Loan Documents (including the Obligations owed to it and its Commitments) to one or more assignees (each, an “ Assignee ”), with the prior written consent (such consent not be unreasonably withheld or delayed) of:
(A) Borrowers; provided , that no consent of Borrowers shall be required (1) if an Event of Default has occurred and is continuing, or (2) in connection with an assignment to a Person that is a Lender or an Affiliate (other than natural persons) of a Lender; provided further, that Borrowers shall be deemed to have consented to a proposed assignment unless they object thereto by written notice to Administrative Agent within 10 Business Days after having received notice thereof; and
(B) Administrative Agent, Swing Lender, and Issuing Bank.
(ii) Assignments shall be subject to the following additional conditions:
(A) no assignment may be made to a natural person,
(B) no assignment may be made to a Loan Party, an Affiliate of a Loan Party, or any Sponsor Affiliated Entity,
(C) the amount of the Commitments and the other rights and obligations of the assigning Lender hereunder and under the other Loan Documents subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to Administrative Agent) shall be in a minimum amount (unless waived by Administrative Agent) of $5,000,000 (except such minimum amount shall not apply to (I) an assignment or delegation by any Lender to any other Lender, an Affiliate of any Lender, or a Related Fund of such Lender or (II) a group of new Lenders, each of which is an Affiliate of each other or a Related Fund of such new Lender to the extent that the aggregate amount to be assigned to all such new Lenders is at least $5,000,000),
(D) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement,
(E) the parties to each assignment shall execute and deliver to Administrative Agent an Assignment and Acceptance; provided , that Borrowers and Administrative Agent may continue to deal solely and directly with the assigning Lender in connection with the interest so assigned to an Assignee until written notice of such assignment, together with payment instructions, addresses, and related information with respect to the Assignee, have been given to Borrowers and Administrative Agent by such Lender and the Assignee,
(F) unless waived by Administrative Agent, the assigning Lender or Assignee has paid to Administrative Agent, for Administrative Agent’s separate account, a processing fee in the amount of $5,000,
 
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(G) the assignee, if it is not a Lender, shall deliver to Administrative Agent an Administrative Questionnaire in a form approved by Administrative Agent (the “ Administrative Questionnaire ”), and
(H) each assignment must be accompanied by an assignment of a proportionate part of all of the assigning Lender’s rights and obligations under the Receivables Facility Credit Agreement (including a proportionate part of the Receivables Facility Secured Obligations owed to such assigning Lender and a proportionate part of such assigning Lender’s “Commitment” under and as defined in the Receivables Facility Credit Agreement).
(b) From and after the date that Administrative Agent receives the executed Assignment and Acceptance and, if applicable, payment of the required processing fee, (i) the Assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such Assignment and Acceptance, shall be a “Lender” and shall have the rights and obligations of a Lender under the Loan Documents, and (ii) the assigning Lender shall, to the extent that rights and obligations hereunder and under the other Loan Documents have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights (except with respect to Section 10.3 ) and be released from any future obligations under this Agreement (and in the case of an Assignment and Acceptance covering all or the remaining portion of an assigning Lender’s rights and obligations under this Agreement and the other Loan Documents, such Lender shall cease to be a party hereto and thereto); provided , that nothing contained herein shall release any assigning Lender from obligations that survive the termination of this Agreement, including such assigning Lender’s obligations under Section 15 and Section 17.9(a) .
(c) By executing and delivering an Assignment and Acceptance, the assigning Lender thereunder and the Assignee thereunder confirm to and agree with each other and the other parties hereto as follows: (i) other than as provided in such Assignment and Acceptance, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any other Loan Document furnished pursuant hereto, (ii) such assigning Lender makes no representation or warranty and assumes no responsibility with respect to the financial condition of any Borrower or the performance or observance by any Borrower of any of its obligations under this Agreement or any other Loan Document furnished pursuant hereto, (iii) such Assignee confirms that it has received a copy of this Agreement, together with such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Assignment and Acceptance, (iv) such Assignee will, independently and without reliance upon Administrative Agent, such assigning Lender or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement, (v) such Assignee appoints and authorizes Administrative Agent to take such actions and to exercise such powers under this Agreement and the other Loan Documents as are delegated to Administrative Agent, by the terms hereof and thereof, together with such powers as are reasonably incidental thereto, and (vi) such Assignee agrees that it will perform all of the obligations which by the terms of this Agreement are required to be performed by it as a Lender.
(d) Immediately upon Administrative Agent’s receipt of the required processing fee, if applicable, and delivery of notice to the assigning Lender pursuant to Section 13.1(b) , this Agreement shall be deemed to be amended to the extent, but only to the extent, necessary to reflect the addition of the Assignee and the resulting adjustment of the Commitments arising therefrom. The Commitment allocated to each Assignee shall reduce such Commitments of the assigning Lender pro tanto .
 
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(e) Any Lender may at any time sell to one or more commercial banks, financial institutions, or other Persons (a “ Participant ”) participating interests in all or any portion of its Obligations, its Commitment, and the other rights and interests of that Lender (the “ Originating Lender ”) hereunder and under the other Loan Documents; provided , that (i) the Originating Lender shall remain a “Lender” for all purposes of this Agreement and the other Loan Documents and the Participant receiving the participating interest in the Obligations, the Commitments, and the other rights and interests of the Originating Lender hereunder shall not constitute a “Lender” hereunder or under the other Loan Documents and the Originating Lender’s obligations under this Agreement shall remain unchanged, (ii) the Originating Lender shall remain solely responsible for the performance of such obligations, (iii) Borrowers, Administrative Agent, and the Lenders shall continue to deal solely and directly with the Originating Lender in connection with the Originating Lender’s rights and obligations under this Agreement and the other Loan Documents, (iv) no Lender shall transfer or grant any participating interest under which the Participant has the right to approve any amendment to, or any consent or waiver with respect to, this Agreement or any other Loan Document, except to the extent such amendment to, or consent or waiver with respect to this Agreement or of any other Loan Document would (A) extend the final maturity date of the Obligations hereunder in which such Participant is participating, (B) reduce the interest rate applicable to the Obligations hereunder in which such Participant is participating, (C) release all or substantially all of the Collateral or guaranties (except to the extent expressly provided herein or in any of the Loan Documents) supporting the Obligations hereunder in which such Participant is participating, (D) postpone the payment of, or reduce the amount of, the interest or fees payable to such Participant through such Lender (other than a waiver of default interest), or (E) decreases the amount or postpones the due dates of scheduled principal repayments or prepayments or premiums payable to such Participant through such Lender, (v) no participation shall be sold to a natural person, (vi) no participation shall be sold to a Loan Party, an Affiliate of a Loan Party, or any Sponsor Affiliated Entity, and (vii) all amounts payable by Borrowers hereunder shall be determined as if such Lender had not sold such participation, except that, if amounts outstanding under this Agreement are due and unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall be deemed to have the right of set off in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement. The rights of any Participant only shall be derivative through the Originating Lender with whom such Participant participates and no Participant shall have any rights under this Agreement or the other Loan Documents or any direct rights as to the other Lenders, Administrative Agent, Borrowers, the Collateral, or otherwise in respect of the Obligations. No Participant shall have the right to participate directly in the making of decisions by the Lenders among themselves.
(f) In connection with any such assignment or participation or proposed assignment or participation or any grant of a security interest in, or pledge of, its rights under and interest in this Agreement, a Lender may, subject to the provisions of Section 17.9 , disclose all documents and information which it now or hereafter may have relating to any Borrower and its Subsidiaries and their respective businesses.
 
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(g) Any other provision in this Agreement notwithstanding, any Lender may at any time create a security interest in, or pledge, all or any portion of its rights under and interest in this Agreement in favor of any Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Bank or U.S. Treasury Regulation 31 CFR §203.24, and such Federal Reserve Bank may enforce such pledge or security interest in any manner permitted under applicable law.
(h) Administrative Agent (as a non-fiduciary agent on behalf of Borrowers) shall maintain, or cause to be maintained, a register (the “ Register ”) on which it enters the name and address of each Lender as the registered owner of the Revolving Loans and/or Obligations (and the principal amount thereof and stated interest thereon) held by such Lender (each, a “ Registered Loan ”). Other than in connection with an assignment by a Lender of all or any portion of its portion of the Revolving Loans and/or Obligations to an Affiliate of such Lender or a Related Fund of such Lender (i) a Registered Loan (and the registered note, if any, evidencing the same) may be assigned or sold in whole or in part only by registration of such assignment or sale on the Register (and each registered note shall expressly so provide) and (ii) any assignment or sale of all or part of such Registered Loan (and the registered note, if any, evidencing the same) may be effected only by registration of such assignment or sale on the Register, together with the surrender of the registered note, if any, evidencing the same duly endorsed by (or accompanied by a written instrument of assignment or sale duly executed by) the holder of such registered note, whereupon, at the request of the designated assignee(s) or transferee(s), one or more new registered notes in the same aggregate principal amount shall be issued to the designated assignee(s) or transferee(s). Prior to the registration of assignment or sale of any Registered Loan (and the registered note, if any evidencing the same), Borrowers shall treat the Person in whose name such Registered Loan (and the registered note, if any, evidencing the same) is registered as the owner thereof for the purpose of receiving all payments thereon and for all other purposes, notwithstanding notice to the contrary. In the case of any assignment by a Lender of all or any portion of its Revolving Loans and/or Obligations to an Affiliate of such Lender or a Related Fund of such Lender, and which assignment is not recorded in the Register, the assigning Lender, on behalf of Borrowers, shall maintain a register comparable to the Register.
(i) In the event that a Lender sells participations in the Registered Loan, such Lender, as a non-fiduciary agent on behalf of Borrowers, shall maintain (or cause to be maintained) a register on which it enters the name of all participants in the Registered Loans held by it (and the principal amount (and stated interest thereon) of the portion of such Registered Loans that is subject to such participations) (the “ Participant Register ”). A Registered Loan (and the registered note, if any, evidencing the same) may be participated in whole or in part only by registration of such participation on the Participant Register (and each registered note shall expressly so provide). Any participation of such Registered Loan (and the registered note, if any, evidencing the same) may be effected only by the registration of such participation on the Participant Register.
(j) Administrative Agent shall make a copy of the Register (and each Lender shall make a copy of its Participant Register in the extent it has one) available for review by Borrowers from time to time as Borrowers may reasonably request.
13.2 Successors . This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties; provided , that no Borrower may assign this Agreement or any rights or duties hereunder without the Lenders’ prior written consent and any prohibited assignment
 
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shall be absolutely void ab initio . No consent to assignment by the Lenders shall release any Borrower from its Obligations. A Lender may assign this Agreement and the other Loan Documents and its rights and duties hereunder and thereunder pursuant to Section 13.1 and, except as expressly required pursuant to Section 13.1 , no consent or approval by any Borrower is required in connection with any such assignment.
14. AMENDMENTS; WAIVERS .
14.1 Amendments and Waivers .
(a) No amendment, waiver or other modification of any provision of this Agreement or any other Loan Document (other than Bank Product Agreements or the Fee Letter), and no consent with respect to any departure by any Loan Party therefrom, shall be effective unless the same shall be in writing and signed by the Required Lenders (or by Administrative Agent at the written request of the Required Lenders) and the Loan Parties that are party thereto and then any such waiver or consent shall be effective, but only in the specific instance and for the specific purpose for which given; provided , that no such waiver, amendment, or consent shall, unless in writing and signed by all of the Lenders directly affected thereby and all of the Loan Parties that are party thereto, do any of the following:
(i) increase the amount of or extend the expiration date of any Commitment of any Lender or amend, modify, or eliminate the last sentence of Section 2.4(c)(i) ;
(ii) postpone or delay any date fixed by this Agreement or any other Loan Document for any payment of principal, interest, fees, or other amounts due hereunder or under any other Loan Document or amend, modify, or eliminate the definition of “Maturity Date”;
(iii) reduce the principal of, or the rate of interest on, any loan or other extension of credit hereunder, or reduce any fees or other amounts payable hereunder or under any other Loan Document (except (y) in connection with the waiver of applicability of Section 2.6(c)  (which waiver shall be effective with the written consent of the Required Lenders), and (z) that any amendment or modification of defined terms used in the financial covenants in this Agreement shall not constitute a reduction in the rate of interest or a reduction of fees for purposes of this clause (iii) );
(iv) amend, modify, or eliminate this Section 14.1  or any provision of this Agreement providing for consent or other action by all Lenders;
(v) amend, modify, or eliminate Section 3.1 or 3.2;
(vi) amend, modify, or eliminate Section 15.11 ;
(vii) other than as permitted by Section 15.11 , release Administrative Agent’s Lien in and to any of the Collateral;
(viii) amend, modify, or eliminate the definitions of “Required Lenders” or “Pro Rata Share”;
(ix) contractually subordinate any of Administrative Agent’s Liens (other than to provide, with respect to any Lien that has priority over Administrative Agent’s Liens pursuant to any applicable law, an acknowledgment or other similar ministerial confirmation of the priority of such Lien relative to Administrative Agent’s Liens);
 
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(x) other than in connection with a merger, liquidation, dissolution or sale of such Person expressly permitted by the terms hereof or the other Loan Documents, release any Borrower or any Guarantor from any obligation for the payment of money or consent to the assignment or transfer by any Borrower or any Guarantor of any of its rights or duties under this Agreement or the other Loan Documents; or
(xi) amend, modify, or eliminate any of the provisions of Section 2.4(b)(i) , (ii) , or (iii)  or Section 2.4(e) or (f) .
(b) No amendment, waiver, modification, or consent shall amend, modify, waive, or eliminate:
(i) the definition of, or any of the terms or provisions of, the Fee Letter, without the written consent of Administrative Agent and Borrowers (and shall not require the written consent of any of the Lenders); or
(ii) any provision of Section 15 pertaining to Administrative Agent, or any other rights or duties of Administrative Agent under this Agreement or the other Loan Documents, without the written consent of Administrative Agent, Borrowers, and the Required Lenders.
(c) No amendment, waiver, modification, elimination, or consent shall, without written consent of Administrative Agent, Borrowers, and each Lender (other than any Defaulting Lender), do any of the following: (i) amend, modify, or eliminate the definition of “Borrowing Base” or any of the defined terms (including, without limitation, the definition of “Eligible Inventory”) that are used in such definition, to the extent that any such change results in more credit being made available to Borrowers based upon the Borrowing Base, but not otherwise; (ii) amend, modify, or eliminate the definition of “Maximum Revolver Amount”; or (iii) change Section 2.1(c) .
(d) No amendment, waiver, modification, elimination, or consent shall amend, modify, or eliminate clause (t) of Section 8 without the written consent of Administrative Agent, Borrowers, and each Lender (other than any Defaulting Lender).
(e) No amendment, waiver, modification, elimination, or consent shall amend, modify, or waive any provision of this Agreement or the other Loan Documents pertaining to Issuing Bank, or any other rights or duties of Issuing Bank under this Agreement or the other Loan Documents, without the written consent of Issuing Bank, Administrative Agent, Borrowers, and the Required Lenders.
(f) No amendment, waiver, modification, elimination, or consent shall amend, modify, or waive any provision of this Agreement or the other Loan Documents pertaining to Swing Lender, or any other rights or duties of Swing Lender under this Agreement or the other Loan Documents, without the written consent of Swing Lender, Administrative Agent, Borrowers, and the Required Lenders.
(g) Anything in this Section 14.1 to the contrary notwithstanding, (i) any amendment, modification, elimination, waiver, consent, termination, or release of, or with respect to, any
 
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provision of this Agreement or any other Loan Document that relates only to the relationship of the Lender Group among themselves, and that does not affect the rights or obligations of any Loan Party, shall not require consent by or the agreement of any Loan Party, and (ii) any amendment, waiver, modification, elimination, or consent of or with respect to any provision of this Agreement or any other Loan Document may be entered into without the consent of, or over the objection of, any Defaulting Lender other than any of the matters governed by Section 14.1(a)(i) through (iii)  that affect such Lender.
14.2 Replacement of Certain Lenders .
(a) If (i) any action to be taken by the Lender Group or Administrative Agent hereunder requires the consent, authorization, or agreement of all Lenders or all Lenders affected thereby and if such action has received the consent, authorization, or agreement of the Required Lenders but not of all Lenders or all Lenders affected thereby, or (ii) any Lender makes a claim for compensation under Section 16 , then Borrowers or Administrative Agent, upon at least 5 Business Days prior irrevocable notice, may permanently replace any Lender that failed to give its consent, authorization, or agreement (a “ Non-Consenting Lender ”) or any Lender that made a claim for compensation (a “ Tax Lender ”) with one or more Replacement Lenders, and the Non-Consenting Lender or Tax Lender, as applicable, shall have no right to refuse to be replaced hereunder. Such notice to replace the Non-Consenting Lender or Tax Lender, as applicable, shall specify an effective date for such replacement, which date shall not be later than 15 Business Days after the date such notice is given.
(b) Prior to the effective date of such replacement, the Non-Consenting Lender or Tax Lender, as applicable, and each Replacement Lender shall execute and deliver an Assignment and Acceptance, subject only to the Non-Consenting Lender or Tax Lender, as applicable, being repaid in full its share of the outstanding Obligations (without any premium or penalty of any kind whatsoever, but including (i) all interest, fees and other amounts that may be due in payable in respect thereof, and (ii) an assumption of its Pro Rata Share of participations in the Letters of Credit). If the Non-Consenting Lender or Tax Lender, as applicable, shall refuse or fail to execute and deliver any such Assignment and Acceptance prior to the effective date of such replacement, Administrative Agent may, but shall not be required to, execute and deliver such Assignment and Acceptance in the name or and on behalf of the Non-Consenting Lender or Tax Lender, as applicable, and irrespective of whether Administrative Agent executes and delivers such Assignment and Acceptance, the Non-Consenting Lender or Tax Lender, as applicable, shall be deemed to have executed and delivered such Assignment and Acceptance. The replacement of any Non-Consenting Lender or Tax Lender, as applicable, shall be made in accordance with the terms of Section 13.1 . Until such time as one or more Replacement Lenders shall have acquired all of the Obligations, the Commitments, and the other rights and obligations of the Non-Consenting Lender or Tax Lender, as applicable, hereunder and under the other Loan Documents, the Non-Consenting Lender or Tax Lender, as applicable, shall remain obligated to make the Non-Consenting Lender’s or Tax Lender’s, as applicable, Pro Rata Share of Revolving Loans and to purchase a participation in each Letter of Credit, in an amount equal to its Pro Rata Share of participations in such Letters of Credit.
14.3 No Waivers; Cumulative Remedies . No failure by Administrative Agent or any Lender to exercise any right, remedy, or option under this Agreement or any other Loan Document, or delay by Administrative Agent or any Lender in exercising the same, will operate as a waiver thereof. No waiver by Administrative Agent or any Lender will be effective unless it is in writing, and then only to the extent specifically stated. No waiver by Administrative Agent or any Lender on any occasion shall affect or
 
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diminish Administrative Agent’s and each Lender’s rights thereafter to require strict performance by Borrowers of any provision of this Agreement. Administrative Agent’s and each Lender’s rights under this Agreement and the other Loan Documents will be cumulative and not exclusive of any other right or remedy that Administrative Agent or any Lender may have.
15. AGENT; THE LENDER GROUP .
15.1 Appointment and Authorization of Administrative Agent . Each Lender hereby designates and appoints Wells Fargo as its agent under this Agreement and the other Loan Documents and each Lender hereby irrevocably authorizes (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to designate, appoint, and authorize) Administrative Agent to execute and deliver each of the other Loan Documents on its behalf and to take such other action on its behalf under the provisions of this Agreement and each other Loan Document and to exercise such powers and perform such duties as are expressly delegated to Administrative Agent by the terms of this Agreement or any other Loan Document, together with such powers as are reasonably incidental thereto. Administrative Agent agrees to act as agent for and on behalf of the Lenders (and the Bank Product Providers) on the conditions contained in this Section 15 . Any provision to the contrary contained elsewhere in this Agreement or in any other Loan Document notwithstanding, Administrative Agent shall not have any duties or responsibilities, except those expressly set forth herein or in the other Loan Documents, nor shall Administrative Agent have or be deemed to have any fiduciary relationship with any Lender (or Bank Product Provider), and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against Administrative Agent. Without limiting the generality of the foregoing, the use of the term “agent” in this Agreement or the other Loan Documents with reference to Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only a representative relationship between independent contracting parties. Each Lender hereby further authorizes (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to authorize) Administrative Agent to act as the secured party under each of the Loan Documents that create a Lien on any item of Collateral. Except as expressly otherwise provided in this Agreement, Administrative Agent shall have and may use its sole discretion with respect to exercising or refraining from exercising any discretionary rights or taking or refraining from taking any actions that Administrative Agent expressly is entitled to take or assert under or pursuant to this Agreement and the other Loan Documents. Without limiting the generality of the foregoing, or of any other provision of the Loan Documents that provides rights or powers to Administrative Agent, Lenders agree that Administrative Agent shall have the right to exercise the following powers as long as this Agreement remains in effect: (a) maintain, in accordance with its customary business practices, ledgers and records reflecting the status of the Obligations, the Collateral, payments and proceeds of Collateral, and related matters, (b) execute or file any and all financing or similar statements or notices, amendments, renewals, supplements, documents, instruments, proofs of claim, notices and other written agreements with respect to the Loan Documents, (c) make Revolving Loans, for itself or on behalf of Lenders, as provided in the Loan Documents, (d) exclusively receive, apply, and distribute payments and proceeds of the Collateral as provided in the Loan Documents, (e) open and maintain such bank accounts and cash management arrangements as Administrative Agent deems necessary and appropriate in accordance with the Loan Documents for the foregoing purposes, (f) perform, exercise, and enforce any and all other rights and remedies of the Lender Group with respect to any Borrower or its Subsidiaries, the Obligations, the
 
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Collateral, or otherwise related to any of same as provided in the Loan Documents, and (g) incur and pay such Lender Group Expenses as Administrative Agent may deem necessary or appropriate for the performance and fulfillment of its functions and powers pursuant to the Loan Documents.
15.2 Delegation of Duties . Administrative Agent may execute any of its duties under this Agreement or any other Loan Document by or through agents, employees or attorneys in fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. Administrative Agent shall not be responsible for the negligence or misconduct of any agent or attorney in fact that it selects as long as such selection was made without gross negligence or willful misconduct.
15.3 Liability of Administrative Agent . None of Administrative Agent-Related Persons shall (a) be liable for any action taken or omitted to be taken by any of them under or in connection with this Agreement or any other Loan Document or the transactions contemplated hereby (except for its own gross negligence or willful misconduct), or (b) be responsible in any manner to any of the Lenders (or Bank Product Providers) for any recital, statement, representation or warranty made by any Borrower or any of its Subsidiaries or Affiliates, or any officer or director thereof, contained in this Agreement or in any other Loan Document, or in any certificate, report, statement or other document referred to or provided for in, or received by Administrative Agent under or in connection with, this Agreement or any other Loan Document, or the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document, or for any failure of any Borrower or its Subsidiaries or any other party to any Loan Document to perform its obligations hereunder or thereunder. No Administrative Agent-Related Person shall be under any obligation to any Lenders (or Bank Product Providers) to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the books and records or properties of any Borrower or its Subsidiaries.
15.4 Reliance by Administrative Agent . Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, telegram, telefacsimile or other electronic method of transmission, telex or telephone message, statement or other document or conversation believed by it to be genuine and correct and to have been signed, sent, or made by the proper Person or Persons, and upon advice and statements of legal counsel (including counsel to Borrowers or counsel to any Lender), independent accountants and other experts selected by Administrative Agent. Administrative Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless Administrative Agent shall first receive such advice or concurrence of the Lenders as it deems appropriate and until such instructions are received, Administrative Agent shall act, or refrain from acting, as it deems advisable. If Administrative Agent so requests, it shall first be indemnified to its reasonable satisfaction by the Lenders (and, if it so elects, the Bank Product Providers) against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action. Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request or consent of the Required Lenders and such request and any action taken or failure to act pursuant thereto shall be binding upon all of the Lenders (and Bank Product Providers).
15.5 Notice of Default or Event of Default . Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, except with respect to defaults in the payment of principal, interest, fees, and expenses required to be paid to Administrative Agent for the account of the Lenders and, except with respect to Events of Default of which
 
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Administrative Agent has actual knowledge, unless Administrative Agent shall have received written notice from a Lender or Borrowers referring to this Agreement, describing such Default or Event of Default, and stating that such notice is a “notice of default.” Administrative Agent promptly will notify the Lenders of its receipt of any such notice or of any Event of Default of which Administrative Agent has actual knowledge. If any Lender obtains actual knowledge of any Event of Default, such Lender promptly shall notify the other Lenders and Administrative Agent of such Event of Default. Each Lender shall be solely responsible for giving any notices to its Participants, if any. Subject to Section 15.4 , Administrative Agent shall take such action with respect to such Default or Event of Default as may be requested by the Required Lenders in accordance with Section 9 ; provided , that unless and until Administrative Agent has received any such request, Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable.
15.6 Credit Decision . Each Lender (and Bank Product Provider) acknowledges that none of Administrative Agent-Related Persons has made any representation or warranty to it, and that no act by Administrative Agent hereinafter taken, including any review of the affairs of any Borrower and its Subsidiaries or Affiliates, shall be deemed to constitute any representation or warranty by any Administrative Agent-Related Person to any Lender (or Bank Product Provider). Each Lender represents (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to represent) to Administrative Agent that it has, independently and without reliance upon any Administrative Agent-Related Person and based on such due diligence, documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of each Borrower or any other Person party to a Loan Document, and all applicable bank regulatory laws relating to the transactions contemplated hereby, and made its own decision to enter into this Agreement and to extend credit to Borrowers. Each Lender also represents (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to represent) that it will, independently and without reliance upon any Administrative Agent-Related Person and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and creditworthiness of each Borrower or any other Person party to a Loan Document. Except for notices, reports, and other documents expressly herein required to be furnished to the Lenders by Administrative Agent, Administrative Agent shall not have any duty or responsibility to provide any Lender (or Bank Product Provider) with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any Borrower or any other Person party to a Loan Document that may come into the possession of any of Administrative Agent-Related Persons. Each Lender acknowledges (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that Administrative Agent does not have any duty or responsibility, either initially or on a continuing basis (except to the extent, if any, that is expressly specified herein) to provide such Lender (or Bank Product Provider) with any credit or other information with respect to any Borrower, its Affiliates or any of their respective business, legal, financial or other affairs, and irrespective of whether such information came into Administrative Agent’s or its Affiliates’ or representatives’ possession before or after the date on which such Lender became a party to this Agreement (or such Bank Product Provider entered into a Bank Product Agreement).
 
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15.7 Costs and Expenses; Indemnification . Administrative Agent may incur and pay Lender Group Expenses to the extent Administrative Agent reasonably deems necessary or appropriate for the performance and fulfillment of its functions, powers, and obligations pursuant to the Loan Documents, including court costs, attorneys’ fees and expenses, fees and expenses of financial accountants, advisors, consultants, and appraisers, costs of collection by outside collection agencies, auctioneer fees and expenses, and costs of security guards or insurance premiums paid to maintain the Collateral, whether or not Borrowers are obligated to reimburse Administrative Agent or Lenders for such expenses pursuant to this Agreement or otherwise. Administrative Agent is authorized and directed to deduct and retain sufficient amounts from payments or proceeds of the Collateral received by Administrative Agent to reimburse Administrative Agent for such out-of-pocket costs and expenses prior to the distribution of any amounts to Lenders (or Bank Product Providers). In the event Administrative Agent is not reimbursed for such costs and expenses by Borrowers or their Subsidiaries, each Lender hereby agrees that it is and shall be obligated to pay to Administrative Agent such Lender’s ratable share thereof. Whether or not the transactions contemplated hereby are consummated, each of the Lenders, on a ratable basis, shall indemnify and defend Administrative Agent-Related Persons (to the extent not reimbursed by or on behalf of Borrowers and without limiting the obligation of Borrowers to do so) from and against any and all Indemnified Liabilities; provided , that no Lender shall be liable for the payment to any Administrative Agent-Related Person of any portion of such Indemnified Liabilities resulting solely from such Person’s gross negligence or willful misconduct nor shall any Lender be liable for the obligations of any Defaulting Lender in failing to make a Revolving Loan or other extension of credit hereunder. Without limitation of the foregoing, each Lender shall reimburse Administrative Agent upon demand for such Lender’s ratable share of any costs or out of pocket expenses (including attorneys, accountants, advisors, and consultants fees and expenses) incurred by Administrative Agent in connection with the preparation, execution, delivery, administration, modification, amendment, or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement or any other Loan Document to the extent that Administrative Agent is not reimbursed for such expenses by or on behalf of Borrowers. The undertaking in this Section 15.7  shall survive the payment of all Obligations hereunder and the resignation or replacement of Administrative Agent.
15.8 Administrative Agent in Individual Capacity . Wells Fargo and its Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, provide Bank Products to, acquire Equity Interests in, and generally engage in any kind of banking, trust, financial advisory, underwriting, or other business with any Borrower and its Subsidiaries and Affiliates and any other Person party to any Loan Document as though Wells Fargo were not Administrative Agent hereunder, and, in each case, without notice to or consent of the other members of the Lender Group. The other members of the Lender Group acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, pursuant to such activities, Wells Fargo or its Affiliates may receive information regarding a Borrower or its Affiliates or any other Person party to any Loan Documents that is subject to confidentiality obligations in favor of such Borrower or such other Person and that prohibit the disclosure of such information to the Lenders (or Bank Product Providers), and the Lenders acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, in such circumstances (and in the absence of a waiver of such confidentiality obligations, which waiver Administrative Agent will use its reasonable best efforts to obtain), Administrative Agent shall not be under any obligation to provide such information to them. The terms “Lender” and “Lenders” include Wells Fargo in its individual capacity.
 
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15.9 Successor Administrative Agent . Administrative Agent may resign as Administrative Agent upon 30 days (10 days if an Event of Default has occurred and is continuing) prior written notice to the Lenders (unless such notice is waived by the Required Lenders) and Borrowers (unless such notice is waived by Borrowers) and without any notice to the Bank Product Providers. If Administrative Agent resigns under this Agreement, the Required Lenders shall be entitled, with (so long as no Event of Default has occurred and is continuing) the consent of Borrowers (such consent not to be unreasonably withheld, delayed, or conditioned), appoint a successor Administrative Agent for the Lenders (and the Bank Product Providers). If, at the time that Administrative Agent’s resignation is effective, it is acting as Issuing Bank or the Swing Lender, such resignation shall also operate to effectuate its resignation as Issuing Bank or the Swing Lender, as applicable, and it shall automatically be relieved of any further obligation to issue Letters of Credit, or to make Swing Loans. If no successor Administrative Agent is appointed prior to the effective date of the resignation of Administrative Agent, Administrative Agent may appoint, after consulting with the Lenders and Borrowers, a successor Administrative Agent. If Administrative Agent has materially breached or failed to perform any material provision of this Agreement or of applicable law, the Required Lenders may agree in writing to remove and replace Administrative Agent with a successor Administrative Agent from among the Lenders with (so long as no Event of Default has occurred and is continuing) the consent of Borrowers (such consent not to be unreasonably withheld, delayed, or conditioned). In any such event, upon the acceptance of its appointment as successor Administrative Agent hereunder, such successor Administrative Agent shall succeed to all the rights, powers, and duties of the retiring Administrative Agent and the term “Administrative Agent” shall mean such successor Administrative Agent and the retiring Administrative Agent’s appointment, powers, and duties as Administrative Agent shall be terminated. After any retiring Administrative Agent’s resignation hereunder as Administrative Agent, the provisions of this Section 15 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement. If no successor Administrative Agent has accepted appointment as Administrative Agent by the date which is 30 days following a retiring Administrative Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective and the Lenders shall perform all of the duties of Administrative Agent hereunder until such time, if any, as the Lenders appoint a successor Administrative Agent as provided for above.
15.10 Lender in Individual Capacity . Any Lender and its respective Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, provide Bank Products to, acquire Equity Interests in and generally engage in any kind of banking, trust, financial advisory, underwriting, or other business with any Borrower and its Subsidiaries and Affiliates and any other Person party to any Loan Documents as though such Lender were not a Lender hereunder without notice to or consent of the other members of the Lender Group (or the Bank Product Providers). The other members of the Lender Group acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, pursuant to such activities, such Lender and its respective Affiliates may receive information regarding a Borrower or its Affiliates or any other Person party to any Loan Documents that is subject to confidentiality obligations in favor of such Borrower or such other Person and that prohibit the disclosure of such information to the Lenders, and the Lenders acknowledge (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to acknowledge) that, in such circumstances (and in the absence of a waiver of such confidentiality obligations, which waiver such Lender will use its reasonable best efforts to obtain), such Lender shall not be under any obligation to provide such information to them.
 
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15.11 Collateral Matters .
(a) The Lenders hereby irrevocably authorize (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to authorize) Administrative Agent to release any Lien (i) on any Collateral upon the termination of the Commitments and payment and satisfaction in full by Borrowers of all of the Obligations, (ii) on any Collateral constituting property being sold or disposed of if a release is required or desirable in connection therewith and if Borrowers certify to Administrative Agent that the sale or disposition is permitted under Section 6.5 (and Administrative Agent may rely conclusively on any such certificate, without further inquiry), (iii) on any Collateral constituting property in which none of Borrowers and their Subsidiaries owned any interest at the time Administrative Agent’s Lien was granted nor at any time thereafter, (iv) on any Collateral constituting property leased or licensed to a Borrower or its Subsidiaries under a lease or license that has expired or is terminated in a transaction permitted under this Agreement, (v) on any Collateral in connection with a credit bid or purchase authorized under this Section 15.11 , (vi) in Administrative Agent’s discretion, in addition to any Collateral released as authorized under clauses (i) through (v)  above and clause (vii) below, on any other Collateral valued in the aggregate not in excess of $5,000,000 during any calendar year (it being agreed that Administrative Agent may rely conclusively on one or more certificates of Borrowers as to the value of any Collateral to be so released, without further inquiry), or (vii) in Administrative Agent’s discretion, in addition to any Collateral released as authorized under clauses (i) through (vi)  above, on any other Collateral valued in the aggregate not in excess of $10,000,000 during any calendar year, so long as before and after giving effect to any such release authorized under this clause (vii) the Borrowing Base exceeds the Maximum Revolver Amount (it being agreed that Administrative Agent may rely conclusively on one or more Borrowing Base Certificates and other certificates of Borrowers as to the amount of the Borrowing Base and/or the value of any Collateral to be so released, as applicable, without further inquiry). The Loan Parties and the Lenders hereby irrevocably authorize (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to authorize) Administrative Agent, based upon the instruction of the Required Lenders, to (A) consent to the sale of, credit bid, or purchase (either directly or indirectly through one or more entities) all or any portion of the Collateral at any sale thereof conducted under the provisions of the Bankruptcy Code, including Section 363 of the Bankruptcy Code, (B) credit bid or purchase (either directly or indirectly through one or more entities) all or any portion of the Collateral at any sale or other disposition thereof conducted under the provisions of the Code, including pursuant to Sections 9-610 or 9-620 of the Code, or (C) credit bid or purchase (either directly or indirectly through one or more entities) all or any portion of the Collateral at any other sale or foreclosure conducted or consented to by Administrative Agent in accordance with applicable law in any judicial action or proceeding or by the exercise of any legal or equitable remedy. In connection with any such credit bid or purchase, (i) the Obligations owed to the Lenders and the Bank Product Providers shall be entitled to be, and shall be, credit bid on a ratable basis (with Obligations with respect to contingent or unliquidated claims being estimated for such purpose if the fixing or liquidation thereof would not impair or unduly delay the ability of Administrative Agent to credit bid or purchase at such sale or other disposition of the Collateral and, if such contingent or unliquidated claims cannot be estimated without impairing or unduly delaying the ability of Administrative Agent to credit bid at such sale or other disposition, then such claims shall be disregarded, not credit bid, and not entitled to any interest in the Collateral that is the subject of such credit bid or purchase) and the Lenders and the Bank Product Providers whose Obligations are credit bid shall be entitled to receive interests (ratably based upon the proportion of their Obligations credit bid in relation to the aggregate amount of Obligations so credit bid) in the Collateral that is the subject of such credit bid or
 
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purchase (or in the Equity Interests of the any entities that are used to consummate such credit bid or purchase), and (ii) Administrative Agent, based upon the instruction of the Required Lenders, may accept non-cash consideration, including debt and equity securities issued by any entities used to consummate such credit bid or purchase and in connection therewith Administrative Agent may reduce the Obligations owed to the Lenders and the Bank Product Providers (ratably based upon the proportion of their Obligations credit bid in relation to the aggregate amount of Obligations so credit bid) based upon the value of such non-cash consideration. Except as provided above, Administrative Agent will not execute and deliver a release of any Lien on any Collateral without the prior written authorization of (y) if the release is of all or substantially all of the Collateral, all of the Lenders (without requiring the authorization of the Bank Product Providers), or (z) otherwise, the Required Lenders (without requiring the authorization of the Bank Product Providers). Upon request by Administrative Agent or Borrowers at any time, the Lenders will (and if so requested, the Bank Product Providers will) confirm in writing Administrative Agent’s authority to release any such Liens on particular types or items of Collateral pursuant to this Section 15.11 ; provided, that (1) anything to the contrary contained in any of the Loan Documents notwithstanding, Administrative Agent shall not be required to execute any document or take any action necessary to evidence such release on terms that, in Administrative Agent’s opinion, could expose Administrative Agent to liability or create any obligation or entail any consequence other than the release of such Lien without recourse, representation, or warranty, and (2) such release shall not in any manner discharge, affect, or impair the Obligations or any Liens (other than those expressly released) upon (or obligations of Borrowers in respect of) any and all interests retained by any Borrower, including, the proceeds of any sale, all of which shall continue to constitute part of the Collateral. Each Lender further hereby irrevocably authorize (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to irrevocably authorize) Administrative Agent, at its option and in its sole discretion, to subordinate any Lien granted to or held by Administrative Agent under any Loan Document to the holder of any Lien permitted by this Agreement on such property if such permitted Lien secures purchase money Indebtedness permitted by this Agreement.
(b) Administrative Agent shall have no obligation whatsoever to any of the Lenders (or the Bank Product Providers) (i) to verify or assure that the Collateral exists or is owned by Borrowers or their Subsidiaries or is cared for, protected, or insured or has been encumbered, (ii) to verify or assure that Administrative Agent’s Liens have been properly or sufficiently or lawfully created, perfected, protected, or enforced or are entitled to any particular priority, (iii) to verify or assure that any particular items of Collateral meet the eligibility criteria applicable in respect thereof, (iv) to impose, maintain, increase, reduce, implement, or eliminate any particular reserve hereunder or to determine whether the amount of any reserve is appropriate or not, or (v) to exercise at all or in any particular manner or under any duty of care, disclosure or fidelity, or to continue exercising, any of the rights, authorities and powers granted or available to Administrative Agent pursuant to any of the Loan Documents, it being understood and agreed that in respect of the Collateral, or any act, omission, or event related thereto, subject to the terms and conditions contained herein, Administrative Agent may act in any manner it may deem appropriate, in its sole discretion given Administrative Agent’s own interest in the Collateral in its capacity as one of the Lenders and that Administrative Agent shall have no other duty or liability whatsoever to any Lender (or Bank Product Provider) as to any of the foregoing, except as otherwise expressly provided herein.
 
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15.12 Right of Setoff; Restrictions on Actions by Lenders; Sharing of Payments .
(a) If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held, and other obligations (in whatever currency) at any time owing, by such Lender or such Affiliate, to or for the credit or the account of any Borrower or any other Loan Party against any and all of the obligations of such Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or such Affiliate, irrespective of whether or not such Lender such or Affiliate shall have made any demand under this Agreement or any other Loan Document and although such obligations of such Borrower or such Loan Party may be unmatured; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (i) all amounts so set off shall be paid over immediately to Administrative Agent for further application in accordance with the provisions of Section 2.3(g) and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of Administrative Agent, each Issuing Bank, and the Lenders, and (ii) such Defaulting Lender shall provide promptly to Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender under this Section 15.12(a) are in addition to other rights and remedies (including other rights of setoff) that such Lender may have. Each Lender agrees to notify the Borrower Representative and Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application under this Section 15.12(a) .
(b) Each of the Lenders agrees that it shall not, unless specifically requested to do so in writing by Administrative Agent, take or cause to be taken any action, including, the commencement of any legal or equitable proceedings to enforce any Loan Document against any Borrower or any Guarantor or to foreclose any Lien on, or otherwise enforce any security interest in, any of the Collateral.
(c) If, at any time or times any Lender shall receive (i) by payment, foreclosure, setoff, or otherwise, any proceeds of Collateral or any payments with respect to the Obligations, except for any such proceeds or payments received by such Lender from Administrative Agent pursuant to the terms of this Agreement, or (ii) payments from Administrative Agent in excess of such Lender’s Pro Rata Share of all such distributions by Administrative Agent, such Lender promptly shall (A) turn the same over to Administrative Agent, in kind, and with such endorsements as may be required to negotiate the same to Administrative Agent, or in immediately available funds, as applicable, for the account of all of the Lenders and for application to the Obligations in accordance with the applicable provisions of this Agreement, or (B) purchase, without recourse or warranty, an undivided interest and participation in the Obligations owed to the other Lenders so that such excess payment received shall be applied ratably as among the Lenders in accordance with their Pro Rata Shares; provided , that to the extent that such excess payment received by the purchasing party is thereafter recovered from it, those purchases of participations shall be rescinded in whole or in part, as applicable, and the applicable portion of the purchase price paid therefor shall be returned to such purchasing party, but without interest except to the extent that such purchasing party is required to pay interest in connection with the recovery of the excess payment.
15.13 Agency for Perfection . Administrative Agent hereby appoints each other Lender (and each Bank Product Provider) as its agent (and each Lender hereby accepts (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to accept) such appointment) for the
 
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purpose of perfecting Administrative Agent’s Liens in assets which, in accordance with Article 8 or Article 9, as applicable, of the Code can be perfected by possession or control. Should any Lender obtain possession or control of any such Collateral, such Lender shall notify Administrative Agent thereof, and, promptly upon Administrative Agent’s request therefor shall deliver possession or control of such Collateral to Administrative Agent or in accordance with Administrative Agent’s instructions.
15.14 Payments by Administrative Agent to the Lenders . All payments to be made by Administrative Agent to the Lenders (or Bank Product Providers) shall be made by bank wire transfer of immediately available funds pursuant to such wire transfer instructions as each party may designate for itself by written notice to Administrative Agent. Concurrently with each such payment, Administrative Agent shall identify whether such payment (or any portion thereof) represents principal, premium, fees, or interest of the Obligations.
15.15 Concerning the Collateral and Related Loan Documents . Each member of the Lender Group authorizes and directs Administrative Agent to enter into this Agreement and the other Loan Documents. Each member of the Lender Group agrees (and by entering into a Bank Product Agreement, each Bank Product Provider shall be deemed to agree) that any action taken by Administrative Agent in accordance with the terms of this Agreement or the other Loan Documents relating to the Collateral and the exercise by Administrative Agent of its powers set forth therein or herein, together with such other powers that are reasonably incidental thereto, shall be binding upon all of the Lenders (and such Bank Product Provider).
15.16 Field Examination Reports; Confidentiality; Disclaimers by Lenders; Other Reports and Information . By becoming a party to this Agreement, each Lender:
(a) is deemed to have requested that Administrative Agent furnish such Lender, promptly after it becomes available, a copy of each field examination report respecting any Borrower or its Subsidiaries (each, a “ Report ”) prepared by or at the request of Administrative Agent, and Administrative Agent shall so furnish each Lender with such Reports;
(b) expressly agrees and acknowledges that Administrative Agent does not (i) make any representation or warranty as to the accuracy of any Report, and (ii) shall not be liable for any information contained in any Report;
(c) expressly agrees and acknowledges that the Reports are not comprehensive audits or examinations, that Administrative Agent or other party performing any field examination will inspect only specific information regarding Borrowers and their Subsidiaries and will rely significantly upon Borrowers’ and their Subsidiaries’ books and records, as well as on representations of Borrowers’ personnel;
(d) agrees to keep all Reports and other material, non-public information regarding Borrowers and their Subsidiaries and their operations, assets, and existing and contemplated business plans in a confidential manner in accordance with Section 17.9 ; and
(e) without limiting the generality of any other indemnification provision contained in this Agreement, agrees: (i) to hold Administrative Agent and any other Lender preparing a Report harmless from any action the indemnifying Lender may take or fail to take or any conclusion the indemnifying Lender may reach or draw from any Report in connection with any loans or other credit
 
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accommodations that the indemnifying Lender has made or may make to Borrowers, or the indemnifying Lender’s participation in, or the indemnifying Lender’s purchase of, a loan or loans of Borrowers, and (ii) to pay and protect, and indemnify, defend and hold Administrative Agent, and any such other Lender preparing a Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts (including, attorneys’ fees and costs) incurred by Administrative Agent and any such other Lender preparing a Report as the direct or indirect result of any third parties who might obtain all or part of any Report through the indemnifying Lender other than in accordance with Section 17.9 .
(f) In addition to the foregoing, (x) any Lender may from time to time request of Administrative Agent in writing that Administrative Agent provide to such Lender a copy of any report or document provided by any Borrower or its Subsidiaries to Administrative Agent that has not been contemporaneously provided by such Borrower or such Subsidiary to such Lender, and, upon receipt of such request, Administrative Agent promptly shall provide a copy of same to such Lender, (y) to the extent that Administrative Agent is entitled, under any provision of the Loan Documents, to request additional reports or information from any Borrower or its Subsidiaries, any Lender may, from time to time, reasonably request Administrative Agent to exercise such right as specified in such Lender’s notice to Administrative Agent, whereupon Administrative Agent promptly shall request of Borrowers the additional reports or information reasonably specified by such Lender, and, upon receipt thereof from such Borrower or such Subsidiary, Administrative Agent promptly shall provide a copy of same to such Lender, and (z) any time that Administrative Agent renders to Borrowers a statement regarding the Loan Account, Administrative Agent shall send a copy of such statement to each Lender.
15.17 Several Obligations; No Liability . Notwithstanding that certain of the Loan Documents now or hereafter may have been or will be executed only by or in favor of Administrative Agent in its capacity as such, and not by or in favor of the Lenders, any and all obligations on the part of Administrative Agent (if any) to make any credit available hereunder shall constitute the several (and not joint) obligations of the respective Lenders on a ratable basis, according to their respective Commitments, to make an amount of such credit not to exceed, in principal amount, at any one time outstanding, the amount of their respective Commitments. Nothing contained herein shall confer upon any Lender any interest in, or subject any Lender to any liability for, or in respect of, the business, assets, profits, losses, or liabilities of any other Lender. Each Lender shall be solely responsible for notifying its Participants of any matters relating to the Loan Documents to the extent any such notice may be required, and no Lender shall have any obligation, duty, or liability to any Participant of any other Lender. Except as provided in Section 15.7 , no member of the Lender Group shall have any liability for the acts of any other member of the Lender Group. No Lender shall be responsible to any Borrower or any other Person for any failure by any other Lender (or Bank Product Provider) to fulfill its obligations to make credit available hereunder, nor to advance for such Lender (or Bank Product Provider) or on its behalf, nor to take any other action on behalf of such Lender (or Bank Product Provider) hereunder or in connection with the financing contemplated herein.
15.18 Joint Lead Arrangers, Joint Book Runners, Co-Syndication Agents, and Co-Documentation Agents . Each of the Joint Lead Arrangers, Joint Book Runners, Co-Syndication Agents, and Co-Documentation Agents, in such capacity, shall not have any right, power, obligation, liability, responsibility, or duty under this Agreement other than those applicable to it in its capacity as a Lender, as Administrative Agent, as Swing Lender, or as Issuing Bank. Without limiting the foregoing, each of the Joint Lead Arrangers, Joint Book Runners, Co-Syndication Agents, and Co-Documentation
 
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Agents, in such capacities, shall not have or be deemed to have any fiduciary relationship with any Lender or any Loan Party. Each Lender, Administrative Agent, Swing Lender, Issuing Bank, and each Loan Party acknowledges that it has not relied, and will not rely, on the Joint Lead Arrangers, Joint Book Runners, Co-Syndication Agents, and Co-Documentation Agents in deciding to enter into this Agreement or in taking or not taking action hereunder. Each of the Joint Lead Arrangers, Joint Book Runners, Co-Syndication Agents, and Co-Documentation Agents, in such capacity, shall be entitled to resign at any time by giving notice to Administrative Agent and Borrowers.
16. WITHHOLDING TAXES .
16.1 Payments . All payments made by Borrowers hereunder or under any note or other Loan Document will be made without setoff, counterclaim, or other defense. In addition, all such payments will be made free and clear of, and without deduction or withholding for, any present or future Indemnified Taxes, and in the event any deduction or withholding of Indemnified Taxes is required, Borrowers shall comply with the next sentence of this Section 16.1 . If any Indemnified Taxes are so levied or imposed, Borrowers agree to pay the full amount of such Indemnified Taxes and such additional amounts as may be necessary so that every payment of all amounts due under this Agreement, any note, or Loan Document, including any amount paid pursuant to this Section 16.1 after withholding or deduction for or on account of any Indemnified Taxes, will not be less than the amount provided for herein. Borrowers will furnish to Administrative Agent as promptly as possible after the date the payment of any Indemnified Tax is due pursuant to applicable law, certified copies of tax receipts evidencing such payment by Borrowers. Borrowers agree to pay any present or future stamp, value added or documentary taxes or any other excise or property taxes, charges, or similar levies that arise from any payment made hereunder or from the execution, delivery, performance, recordation, or filing of, or otherwise with respect to this Agreement or any other Loan Document.
16.2 Exemptions .
(a) If a Lender or Participant is entitled to claim an exemption or reduction from United States withholding tax, such Lender or Participant agrees with and in favor of Administrative Agent, to deliver to Administrative Agent (or, in the case of a Participant, to the Lender granting the participation only) one of the following before receiving its first payment under this Agreement:
(i) if such Lender or Participant is entitled to claim an exemption from United States withholding tax pursuant to the portfolio interest exception, (A) a statement of the Lender or Participant, signed under penalty of perjury, that it is not a (I) a “bank” as described in Section 881(c)(3)(a) of the IRC, (II) a 10% shareholder of any Borrower (within the meaning of Section 871(h)(3)(b) of the IRC), or (III) a controlled foreign corporation related to Borrowers within the meaning of Section 864(d)(4) of the IRC, and (B) a properly completed and executed IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, or Form W-8IMY (with proper attachments);
(ii) if such Lender or Participant is entitled to claim an exemption from, or a reduction of, withholding tax under a United States tax treaty, a properly completed and executed copy of IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable;
(iii) if such Lender or Participant is entitled to claim that interest paid under this Agreement is exempt from United States withholding tax because it is effectively connected with a United States trade or business of such Lender, a properly completed and executed copy of IRS Form W-8ECI;
 
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(iv) if such Lender or Participant is entitled to claim that interest paid under this Agreement is exempt from United States withholding tax because such Lender or Participant serves as an intermediary, a properly completed and executed copy of IRS Form W-8IMY (with proper attachments); or
(v) a properly completed and executed copy of any other form or forms, including IRS Form W-9, as may be required under the IRC or other laws of the United States as a condition to exemption from, or reduction of, United States withholding or backup withholding tax.
(b) Each Lender or Participant shall provide new forms (or successor forms) upon the expiration or obsolescence of any previously delivered forms and promptly notify Administrative Agent (or, in the case of a Participant, the Lender granting the participation only) of any change in circumstances which would modify or render invalid any claimed exemption or reduction.
(c) If a Lender or Participant claims an exemption from withholding tax in a jurisdiction other than the United States, such Lender or such Participant agrees with and in favor of Administrative Agent, to deliver to Administrative Agent (or, in the case of a Participant, to the Lender granting the participation only) any such form or forms, as may be required under the laws of such jurisdiction as a condition to exemption from, or reduction of, foreign withholding or backup withholding tax before receiving its first payment under this Agreement, but only if such Lender or such Participant is legally able to deliver such forms, provided , that nothing in this Section 16.2(c)  shall require a Lender or Participant to disclose any information that it deems to be confidential (including without limitation, its tax returns). Each Lender and each Participant shall provide new forms (or successor forms) upon the expiration or obsolescence of any previously delivered forms and promptly notify Administrative Agent (or, in the case of a Participant, the Lender granting the participation only) of any change in circumstances which would modify or render invalid any claimed exemption or reduction.
(d) If a Lender or Participant claims exemption from, or reduction of, withholding tax and such Lender or Participant sells, assigns, grants a participation in, or otherwise transfers all or part of the Obligations of Borrowers to such Lender or Participant, such Lender or Participant agrees to notify Administrative Agent (or, in the case of a sale of a participation interest, the Lender granting the participation only) of the percentage amount in which it is no longer the beneficial owner of Obligations of Borrowers to such Lender or Participant. To the extent of such percentage amount, Administrative Agent will treat such Lender’s or such Participant’s documentation provided pursuant to Section 16.2(a)  or 16.2(c)  as no longer valid. With respect to such percentage amount, such Participant or Assignee may provide new documentation, pursuant to Section 16.2(a)  or 16.2(c) , if applicable. Borrowers agree that each Participant shall be entitled to the benefits of this Section 16 with respect to its participation in any portion of the Commitments and the Obligations so long as such Participant complies with the obligations set forth in this Section 16 with respect thereto.
16.3 Reductions .
(a) If a Lender or a Participant is subject an applicable withholding tax, Administrative Agent (or, in the case of a Participant, the Lender granting the participation) may withhold
 
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from any payment to such Lender or such Participant an amount equivalent to the applicable withholding tax. If the forms or other documentation required by Section 16.2(a)  or 16.2(c)  are not delivered to Administrative Agent (or, in the case of a Participant, to the Lender granting the participation), then Administrative Agent (or, in the case of a Participant, the Lender granting the participation) may withhold from any payment to such Lender or such Participant not providing such forms or other documentation an amount equivalent to the applicable withholding tax.
(b) If the IRS or any other Governmental Authority of the United States or other jurisdiction asserts a claim that Administrative Agent (or, in the case of a Participant, the Lender granting the participation) did not properly withhold tax from amounts paid to or for the account of any Lender or any Participant due to a failure on the part of the Lender or any Participant (because the appropriate form was not delivered, was not properly executed, or because such Lender failed to notify Administrative Agent (or such Participant failed to notify the Lender granting the participation) of a change in circumstances which rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason) such Lender shall indemnify and hold Administrative Agent harmless (or, in the case of a Participant, such Participant shall indemnify and hold the Lender granting the participation harmless) for all amounts paid, directly or indirectly, by Administrative Agent (or, in the case of a Participant, the Lender granting the participation), as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amounts payable to Administrative Agent (or, in the case of a Participant, to the Lender granting the participation only) under this Section 16 , together with all costs and expenses (including attorneys’ fees and expenses). The obligation of the Lenders and the Participants under this subsection shall survive the payment of all Obligations and the resignation or replacement of Administrative Agent.
16.4 Refunds . If Administrative Agent or a Lender determines, in its sole discretion, that it has received a refund of any Indemnified Taxes for which Borrowers have paid additional amounts pursuant to this Section 16 , so long as no Default or Event of Default has occurred and is continuing, it shall pay over such refund to Borrowers (but only to the extent of payments made, or additional amounts paid, by Borrowers under this Section 16 with respect to Indemnified Taxes giving rise to such a refund), net of all out-of-pocket expenses of Administrative Agent or such Lender and without interest (other than any interest paid by the applicable Governmental Authority with respect to such a refund); provided , that Borrowers, upon the request of Administrative Agent or such Lender, agrees to repay the amount paid over to Borrowers (plus any penalties, interest or other charges, imposed by the applicable Governmental Authority, other than such penalties, interest or other charges imposed as a result of the willful misconduct or gross negligence of Administrative Agent hereunder) to Administrative Agent or such Lender in the event Administrative Agent or such Lender is required to repay such refund to such Governmental Authority. Notwithstanding anything in this Agreement to the contrary, this Section 16 shall not be construed to require Administrative Agent or any Lender to make available its tax returns (or any other information which it deems confidential) to Borrowers or any other Person.
17. GENERAL PROVISIONS .
17.1 Effectiveness . This Agreement shall be binding and deemed effective when executed by each Borrower, Administrative Agent, and each Lender whose signature is provided for on the signature pages hereof.
 
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17.2 Section Headings . Headings and numbers have been set forth herein for convenience only. Unless the contrary is compelled by the context, everything contained in each Section applies equally to this entire Agreement.
17.3 Interpretation . Neither this Agreement nor any uncertainty or ambiguity herein shall be construed against the Lender Group or any Borrower, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to accomplish fairly the purposes and intentions of all parties hereto.
17.4 Severability of Provisions . Each provision of this Agreement shall be severable from every other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision.
17.5 Bank Product Providers . Each Bank Product Provider in its capacity as such shall be deemed a third-party beneficiary hereof and of the provisions of the other Loan Documents for purposes of any reference in a Loan Document to the parties for whom Administrative Agent is acting. Administrative Agent hereby agrees to act as agent for such Bank Product Providers and, by virtue of entering into a Bank Product Agreement, the applicable Bank Product Provider shall be automatically deemed to have appointed Administrative Agent as its agent and to have accepted the benefits of the Loan Documents. It is understood and agreed that the rights and benefits of each Bank Product Provider under the Loan Documents consist exclusively of such Bank Product Provider’s being a beneficiary of the Liens and security interests (and, if applicable, guarantees) granted to Administrative Agent and the right to share in payments and collections out of the Collateral as more fully set forth herein. In addition, each Bank Product Provider, by virtue of entering into a Bank Product Agreement, shall be automatically deemed to have agreed that Administrative Agent shall have the right, but shall have no obligation, to establish, maintain, relax, or release reserves in respect of the Bank Product Obligations and that if reserves are established there is no obligation on the part of Administrative Agent to determine or insure whether the amount of any such reserve is appropriate or not. In connection with any such distribution of payments or proceeds of Collateral, Administrative Agent shall be entitled to assume no amounts are due or owing to any Bank Product Provider unless such Bank Product Provider has provided a written certification (setting forth a reasonably detailed calculation) to Administrative Agent as to the amounts that are due and owing to it and such written certification is received by Administrative Agent a reasonable period of time prior to the making of such distribution. Administrative Agent shall have no obligation to calculate the amount due and payable with respect to any Bank Products, but may rely upon the written certification of the amount due and payable from the applicable Bank Product Provider. In the absence of an updated certification, Administrative Agent shall be entitled to assume that the amount due and payable to the applicable Bank Product Provider is the amount last certified to Administrative Agent by such Bank Product Provider as being due and payable (less any distributions made to such Bank Product Provider on account thereof). Borrowers may obtain Bank Products from any Bank Product Provider, although Borrowers are not required to do so. Each Borrower acknowledges and agrees that no Bank Product Provider has committed to provide any Bank Products and that the providing of Bank Products by any Bank Product Provider is in the sole and absolute discretion of such Bank Product Provider. Notwithstanding anything to the contrary in this Agreement or any other Loan Document, no provider or holder of any Bank Product shall have any voting or approval rights hereunder (or be deemed a Lender) solely by virtue of its status as the provider or holder of such agreements or products or the
 
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Obligations owing thereunder, nor shall the consent of any such provider or holder be required (other than in their capacities as Lenders, to the extent applicable) for any matter hereunder or under any of the other Loan Documents, including as to any matter relating to the Collateral or the release of Collateral or Guarantors.
17.6 Debtor-Creditor Relationship . The relationship between the Lenders and Administrative Agent, on the one hand, and the Loan Parties, on the other hand, is solely that of creditor and debtor. No member of the Lender Group has (or shall be deemed to have) any fiduciary relationship or duty to any Loan Party arising out of or in connection with the Loan Documents or the transactions contemplated thereby, and there is no agency or joint venture relationship between the members of the Lender Group, on the one hand, and the Loan Parties, on the other hand, by virtue of any Loan Document or any transaction contemplated therein.
17.7 Counterparts; Electronic Execution . This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by telefacsimile or other electronic method of transmission also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement. The foregoing shall apply to each other Loan Document mutatis mutandis .
17.8 Revival and Reinstatement of Obligations; Certain Waivers . If any member of the Lender Group or any Bank Product Provider repays, refunds, restores, or returns in whole or in part, any payment or property (including any proceeds of Collateral) previously paid or transferred to such member of the Lender Group or such Bank Product Provider in full or partial satisfaction of any Obligation or on account of any other obligation of any Loan Party under any Loan Document or any Bank Product Agreement, because the payment, transfer, or the incurrence of the obligation so satisfied is asserted or declared to be void, voidable, or otherwise recoverable under any law relating to creditors’ rights, including provisions of the Bankruptcy Code relating to fraudulent transfers, preferences, or other voidable or recoverable obligations or transfers (each, a “ Voidable Transfer ”), or because such member of the Lender Group or Bank Product Provider elects to do so on the reasonable advice of its counsel in connection with a claim that the payment, transfer, or incurrence is or may be a Voidable Transfer, then, as to any such Voidable Transfer, or the amount thereof that such member of the Lender Group or Bank Product Provider elects to repay, restore, or return (including pursuant to a settlement of any claim in respect thereof), and as to all reasonable costs, expenses, and attorneys’ fees of such member of the Lender Group or Bank Product Provider related thereto, (i) the liability of the Loan Parties with respect to the amount or property paid, refunded, restored, or returned will automatically and immediately be revived, reinstated, and restored and will exist and (ii) Administrative Agent’s Liens securing such liability shall be effective, revived, and remain in full force and effect, in each case, as fully as if such Voidable Transfer had never been made. If, prior to any of the foregoing, (A) Administrative Agent’s Liens shall have been released or terminated or (B) any provision of this Agreement shall have been terminated or cancelled, Administrative Agent’s Liens, or such provision of this Agreement, shall be reinstated in full force and effect and such prior release, termination, cancellation or surrender shall not diminish, release, discharge, impair or otherwise affect the obligation of any Loan Party in respect of such liability or any Collateral securing such liability.
 
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17.9 Confidentiality .
(a) Administrative Agent and Lenders each individually (and not jointly or jointly and severally) agree that they shall maintain the confidentiality of the Confidential Information (as defined below) and shall not disclose the Confidential Information to Persons who are not parties to this Agreement, except: (i) to attorneys for and other advisors, accountants, auditors, and consultants to any member of the Lender Group and to employees, directors and officers of any member of the Lender Group (the Persons in this clause (i) , “ Lender Group Representatives ”) on a “need to know” basis in connection with this Agreement and the transactions contemplated hereby and on a confidential basis, (ii) to Subsidiaries and Affiliates of any member of the Lender Group (including the Bank Product Providers), provided that any such Subsidiary or Affiliate shall have agreed to receive such information hereunder subject to the terms of this Section 17.9 , (iii) as may be required by regulatory authorities so long as such authorities are informed of the confidential nature of such information, (iv) as may be required by statute, decision, or judicial or administrative order, rule, or regulation; provided that (x) prior to any disclosure under this clause (iv) , the disclosing party agrees to provide Borrowers with prior notice thereof, to the extent that it is practicable to do so and to the extent that the disclosing party is permitted to provide such prior notice to Borrowers pursuant to the terms of the applicable statute, decision, or judicial or administrative order, rule, or regulation and (y) any disclosure under this clause (iv)  shall be limited to the portion of the Confidential Information as may be required by such statute, decision, or judicial or administrative order, rule, or regulation, (v) as may be agreed to in advance in writing by Borrowers, (vi) as requested or required by any Governmental Authority pursuant to any subpoena or other legal process, provided, that, (x) prior to any disclosure under this clause (vi)  the disclosing party agrees to provide Borrowers with prior written notice thereof, to the extent that it is practicable to do so and to the extent that the disclosing party is permitted to provide such prior written notice to Borrowers pursuant to the terms of the subpoena or other legal process and (y) any disclosure under this clause (vi)  shall be limited to the portion of the Confidential Information as may be required by such Governmental Authority pursuant to such subpoena or other legal process, (vii) as to any such information that is or becomes generally available to the public (other than as a result of prohibited disclosure by Administrative Agent or the Lenders or the Lender Group Representatives), (viii) in connection with any assignment, participation or pledge of any Lender’s interest under this Agreement, provided that prior to receipt of Confidential Information any such assignee, participant, or pledgee shall have agreed in writing to receive such Confidential Information either subject to the terms of this Section 17.9 or pursuant to confidentiality requirements substantially similar to those contained in this Section 17.9 (and such Person may disclose such Confidential Information to Persons employed or engaged by them as described in clause (i)  above), (ix) in connection with any litigation or other adversary proceeding involving parties hereto which such litigation or adversary proceeding involves claims related to the rights or duties of such parties under this Agreement or the other Loan Documents; provided , that, prior to any disclosure to any Person (other than any Loan Party, Administrative Agent, any Lender, any of their respective Affiliates, or their respective counsel) under this clause (ix)  with respect to litigation involving any Person (other than any Borrower, Administrative Agent, any Lender, any of their respective Affiliates, or their respective counsel), the disclosing party agrees to provide Borrowers with prior written notice thereof, and (x) in connection with, and to the extent reasonably necessary for, the exercise of any secured creditor remedy under this Agreement or under any other Loan Document. As used in this Section 17.9(a) , “ Confidential
 
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Information ” means all information received from AXE or any Subsidiary of AXE relating to AXE or any Subsidiary of AXE or its business, other than any such information that is available to Administrative Agent, the Issuing Bank, or any Lender on a non-confidential basis prior to disclosure by AXE or any Subsidiary of AXE and other than information pertaining to this Agreement routinely provided by arrangers to data service providers, including league table providers, that serve the lending industry.
(b) Anything in this Agreement to the contrary notwithstanding, Administrative Agent may disclose information concerning the terms and conditions of this Agreement and the other Loan Documents to loan syndication and pricing reporting services or in its marketing or promotional materials, with such information to consist of deal terms and other information customarily found in such publications or marketing or promotional materials and may otherwise use the name, logos, and other insignia of any Borrower or the other Loan Parties and the Commitments provided hereunder in any “tombstone” or other advertisements, on its website or in other marketing materials of Administrative Agent.
(c) The Loan Parties hereby acknowledge that Administrative Agent or its Affiliates may make available to the Lenders materials or information provided by or on behalf of Borrowers hereunder (collectively, “ Borrower Materials ”) by posting the Borrower Materials on IntraLinks, SyndTrak or another similar electronic system (the “ Platform ”) and certain of the Lenders may be “public-side” Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to the Loan Parties or their securities) (each, a “ Public Lender ”). The Loan Parties shall be deemed to have authorized Administrative Agent and its Affiliates and the Lenders to treat Borrower Materials marked “PUBLIC” or otherwise at any time filed with the SEC as not containing any material non-public information with respect to the Loan Parties or their securities for purposes of United States federal and state securities laws. All Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated as “Public Investor” (or another similar term). Administrative Agent and its Affiliates and the Lenders shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” or that are not at any time filed with the SEC as being suitable only for posting on a portion of the Platform not marked as “Public Investor” (or such other similar term).
17.10 Survival . All representations and warranties made by the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that Administrative Agent, Issuing Bank, or any Lender may have had notice or knowledge of any Default or Event of Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of, or any accrued interest on, any Loan or any fee or any other amount payable under this Agreement is outstanding or unpaid or any Letter of Credit is outstanding and so long as the Commitments have not expired or been terminated.
17.11 Patriot Act . Each Lender that is subject to the requirements of the Patriot Act hereby notifies Borrowers that pursuant to the requirements of the Act, it is required to obtain, verify and record information that identifies each Borrower, which information includes the name and address of each Borrower and other information that will allow such Lender to identify each Borrower in accordance with the Patriot Act. In addition, if Administrative Agent is required by law or regulation or internal policies to
 
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do so, it shall have the right to periodically conduct (a) Patriot Act searches, OFAC/PEP searches, and customary individual background checks for the Loan Parties and (b) OFAC/PEP searches and customary individual background checks for the Loan Parties’ senior management and key principals, and each Borrower agrees to cooperate in respect of the conduct of such searches and further agrees that the reasonable costs and charges for such searches shall constitute Lender Group Expenses hereunder and be for the account of Borrowers.
17.12 Integration . This Agreement, together with the other Loan Documents, reflects the entire understanding of the parties with respect to the transactions contemplated hereby and shall not be contradicted or qualified by any other agreement, oral or written, before the date hereof. The foregoing to the contrary notwithstanding, all Bank Product Agreements, if any, are independent agreements governed by the written provisions of such Bank Product Agreements, which will remain in full force and effect, unaffected by any repayment, prepayments, acceleration, reduction, increase, or change in the terms of any credit extended hereunder, except as otherwise expressly provided in such Bank Product Agreement.
 
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17.13 Borrower Representative . Each Borrower hereby irrevocably appoints Anixter as the borrowing agent and attorney-in-fact for all Borrowers (the “ Borrower Representative ”) which appointment shall remain in full force and effect unless and until Administrative Agent shall have received prior written notice signed by each Borrower that such appointment has been revoked and that another Borrower has been appointed Borrower Representative. Each Borrower hereby irrevocably appoints and authorizes the Borrower Representative (a) to provide Administrative Agent with all notices with respect to Revolving Loans and Letters of Credit obtained for the benefit of any Borrower and all other notices and instructions under this Agreement and the other Loan Documents (and any notice or instruction provided by Borrower Representative shall be deemed to be given by Borrowers hereunder and shall bind each Borrower), (b) to receive notices and instructions from members of the Lender Group (and any notice or instruction provided by any member of the Lender Group to the Borrower Representative in accordance with the terms hereof shall be deemed to have been given to each Borrower), and (c) to take such action as the Borrower Representative deems appropriate on its behalf to obtain Revolving Loans and Letters of Credit and to exercise such other powers as are reasonably incidental thereto to carry out the purposes of this Agreement. It is understood that the handling of the Loan Account and Collateral in a combined fashion, as more fully set forth herein, is done solely as an accommodation to Borrowers in order to utilize the collective borrowing powers of Borrowers in the most efficient and economical manner and at their request, and that Lender Group shall not incur liability to any Borrower as a result hereof. Each Borrower expects to derive benefit, directly or indirectly, from the handling of the Loan Account and the Collateral in a combined fashion since the successful operation of each Borrower is dependent on the continued successful performance of the integrated group. To induce the Lender Group to do so, and in consideration thereof, each Borrower hereby jointly and severally agrees to indemnify each member of the Lender Group and hold each member of the Lender Group harmless against any and all liability, expense, loss or claim of damage or injury, made against the Lender Group by any Borrower or by any third party whosoever, arising from or incurred by reason of (i) the handling of the Loan Account and Collateral of Borrowers as herein provided, or (ii) the Lender Group’s relying on any instructions of the Borrower Representative, except that Borrowers will have no liability to the relevant Administrative Agent-Related Person or Lender-Related Person under this Section 17.13 with respect to any liability that has been finally determined by a court of competent jurisdiction to have resulted solely from the gross negligence or willful misconduct of such Administrative Agent-Related Person or Lender-Related Person, as the case may be.
[Signature pages to follow.]
 
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IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be executed and delivered as of the date first above written.

ANIXTER INC.,	
as a Borrower and as the initial Borrower Representative	
		
By:	 	/s/ Rodney Shoemaker	
Name:	 	Rodney Shoemaker	
Title:	 	Senior Vice President – Treasurer	
	
ACCU-TECH CORPORATION,
a Georgia corporation,
as a Borrower	
		
By:	 	/s/ Rodney Shoemaker	
Name:	 	Rodney Shoemaker	
Title:	 	Vice President	
	
TRI-NORTHERN HOLDINGS, INC., a Delaware corporation,	
TRI-NORTHERN ACQUISITION, INC., a Delaware corporation,	
NORTHERN VIDEO SYSTEMS, INC., a California corporation,	
SR DISTRIBUTION, INC., a Delaware corporation,	
TRI-ED DISTRIBUTION INC., a California corporation,	
COMMUNICATION CABLES, LLC, a Delaware limited liability company, each of the above, as a Borrower	
		
By:	 	/s/ Rodney Shoemaker	
Name:	 	Rodney Shoemaker	
Title:	 	Vice President – Treasurer	
 
Signature page to Credit Agreement (Anixter | Inventory Facility)

			
Effective upon consummation of the HD Supply Acquisition:	
	
ANIXTER POWER SOLUTIONS INC., a Michigan corporation	
ANIXTER POWER SOLUTIONS, LLC, a Florida limited liability company, each of the above, as a Borrower	
		
By:	 	/s/ Rodney Shoemaker	
Name:	 	Rodney Shoemaker	
Title:	 	Vice President – Treasurer	
 
Signature page to Credit Agreement (Anixter | Inventory Facility)

			
WELLS FARGO BANK, NATIONAL ASSOCIATION,	
as Administrative Agent and as a Lender	
		
By:	 	/s/ Anwar Young	
Name:	 	Anwar Young	
	 	Its Authorized Signatory	
 
Signature page to Credit Agreement (Anixter | Inventory Facility)

			
JPMORGAN CHASE BANK, N.A.,	
as a Lender	
		
By:	 	/s/ Stephanie Lis	
Name:	 	Stephanie Lis	
	 	Its Authorized Signatory	
 
Signature page to Credit Agreement (Anixter | Inventory Facility)

			
BANK OF AMERICA, N.A.,	
as a Lender	
		
By:	 	/s/ Donald A. Mastro	
Name:	 	Donald A. Mastro	
	 	Its Authorized Signatory	
 
Signature page to Credit Agreement (Anixter | Inventory Facility)

			
SUNTRUST BANK,	
as a Lender	
		
By:	 	/s/ Tighe A. Ittner	
Name:	 	Tighe A. Ittner	
	 	Its Authorized Signatory	
 
Signature page to Credit Agreement (Anixter | Inventory Facility)

			
PNC BANK, NATIONAL ASSOCIATION,	
as a Lender	
		
By:	 	/s/ Ajay Shulz	
Name:	 	Ajay Shulz	
	 	Its Authorized Signatory	
 
Signature page to Credit Agreement (Anixter | Inventory Facility)

SCHEDULE C-1
Commitments

Lender	  	Revolver
Commitment	 	  	Total
Commitment	 	
Wells Fargo Bank, National Association	  	$	42,500,000	  	  	$	42,500,000	  	
JPMorgan Chase Bank, N.A.	  	$	42,500,000	  	  	$	42,500,000	  	
Bank of America, N.A.	  	$	30,000,000	  	  	$	30,000,000	  	
SunTrust Bank	  	$	20,000,000	  	  	$	20,000,000	  	
PNC Bank, National Association	  	$	15,000,000	  	  	$	15,000,000	  	
	  	 	 	 	  	 	 	 	
All Lenders	  	$	150,000,000	  	  	$	150,000,000	  	

Schedule C-1
1

SCHEDULE 1.1
Definitions
As used in the Agreement, the following terms shall have the following definitions:
“ 2011 Receivables Purchase Agreement ” means that certain Second Amended and Restated Receivables Purchase Agreement, dated as of May 31, 2011, by and among ARC, as the seller, Anixter, as the initial servicer, Chariot Funding LLC, as a conduit and the financial institutions from time to time party thereto, and Chase, as the agent, as the same has been amended, restated, amended and restated, modified or supplemented from time to time.
“ 2012 Notes Indenture ” means an Indenture dated as of April 30, 2012, between Anixter, AXE, and Wells Fargo, as trustee, as the same may be amended or replaced from time to time.
“ Accommodation Obligation ” means, as applied to any Person, any contractual obligation, contingent or otherwise, of that Person with respect to any Indebtedness or other obligation or liability of another, including any such Indebtedness, obligation or liability directly or indirectly guaranteed, supported by letter of credit, endorsed (otherwise than for collection or deposit in the ordinary course of business), co-made or discounted or sold with recourse by that Person, or in respect of which that Person is otherwise directly or indirectly liable, including Contractual Obligations (contingent or otherwise) arising through any agreement to purchase, repurchase, or otherwise acquire such Indebtedness, obligation or liability or any security therefor, or to provide funds for the payment or discharge thereof (whether in the form of loans, advances, stock purchases, capital contributions or otherwise), or to maintain solvency, assets, level of income, or other financial condition, or to make payment other than for value received. For purposes of interpreting any provision of this Agreement which refers to the amount of Accommodation Obligations of any Person, such provision shall be deemed to mean the maximum amount of such Accommodation Obligations or, in the case of an Accommodation Obligation to maintain solvency, assets, level of income or other financial condition, the amount of Indebtedness to which such Accommodation Obligation relates, or if less, the stated maximum, if any, in the documents evidencing such Accommodation Obligation. Notwithstanding anything to the contrary contained herein, the term “Accommodation Obligation” shall not be interpreted to include any letter of credit Obligations or any other Obligations hereunder guaranteed by AXE or any other guarantor hereof.
“ Administrative Agent ” has the meaning specified therefor in the preamble to the Agreement.
“ Administrative Agent-Related Persons ” means Administrative Agent, together with its Affiliates, officers, directors, employees, attorneys, and agents.
“ Administrative Agent’s Account ” means the Deposit Account of Administrative Agent identified on Schedule A-1 to this Agreement (or such other Deposit Account of Administrative Agent that has been designated as such, in writing, by Administrative Agent to Borrowers and the Lenders).
“ Administrative Agent’s Liens ” means the Liens granted by each Loan Party or its Subsidiaries to Administrative Agent under the Loan Documents and securing the Obligations.
 
Schedule 1.1
1

“Administrative Questionnaire” has the meaning specified therefor in Section 13.1(a) of the Agreement.
“ Affected Lender ” has the meaning specified therefor in Section 2.13(b)  of the Agreement.
“ Affiliate ” means, as to any Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with, such Person. A Person shall be deemed to be “controlled by” any other Person if such other Person possesses, directly or indirectly, power (a) to vote 33% or more (or, in the case of an Affiliate of a Lender, 20% or more) of the securities (on a fully diluted basis) having ordinary voting power for the election of directors or managing general partners; or (b) to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
“ Agreement ” means the Credit Agreement to which this Schedule 1.1 is attached.
“ Agreement Accounting Principles ” means GAAP as of the date of this Agreement together with any changes in GAAP after the date hereof which are not Material Accounting Changes (as defined below). If any changes in GAAP are hereafter required or permitted and are adopted by AXE or Anixter with the agreement of its independent certified public accountants and such changes result in a material change in the method of calculation of any of the financial covenants, restrictions or standards herein or in the related definitions or terms used therein (“ Material Accounting Changes ”), the parties hereto agree to enter into negotiations, in good faith, in order to amend such provisions in a credit neutral manner so as to reflect equitably such changes with the desired result that the criteria for evaluating Anixter’s consolidated financial condition shall be the same after such changes as if such changes had not been made; provided , however , that no Material Accounting Change shall be given effect in such calculations until such provisions are amended in a manner reasonably satisfactory to the Required Lenders. If such amendment is entered into, all references in this Agreement to Agreement Accounting Principles shall mean GAAP as of the date of such amendment together with any changes in GAAP after the date of such amendment which are not Material Accounting Changes.
“ Anixter ” has the meaning specified therefor in the preamble to the Agreement.
“ Anixter Canada ” means Anixter Canada Inc., a Canada corporation.
“ Applicable Margin ” means, as of any date of determination and with respect to Base Rate Loans or LIBOR Rate Loans, as applicable, the applicable margin set forth in the following table that corresponds to the Average Quarterly Combined Availability of Borrowers for the most recently completed Fiscal Quarter; provided , that for the period from the Closing Date through and including December 31, 2015, the Applicable Margin shall be set at the margin in the row styled “Level II”:

 	  	 	  	Applicable Margin	 	
Level	  	Average Quarterly Combined Availability	  	Base
Rate Loans	 	 	LIBOR Rate
Loans	 	
I	  	Greater than or equal to $500,000,000	  	 	0.25	% 	 	 	1.25	% 	
II	  	Less than $500,000,000
but greater than or equal to $250,000,000	  	 	0.50	% 	 	 	1.50	% 	
III	  	Less than $250,000,000	  	 	0.75	% 	 	 	1.75	% 	
 
Schedule 1.1
2

The Applicable Margin shall be re-determined by Administrative Agent as of the first day of each fiscal quarter of Borrowers.
“ Applicable Unused Line Fee Percentage ” means, as of any date of determination, the applicable percentage set forth in the following table that corresponds to the Average Revolver Usage of Borrowers for the most recently completed month as determined by Administrative Agent in its Permitted Discretion:

Level	  	Average Revolver Usage	  	Applicable Unused
Line Fee Percentage	 	
I	  	Greater than or equal to
50% of the aggregate Revolver Commitments	  	 	0.250	% 	
II	  	Less than 50% of the aggregate Revolver Commitments	  	 	0.375	% 	
The Applicable Unused Line Fee Percentage shall be re-determined by Administrative Agent as of the first day of each month of Borrowers.
“ Application Event ” means the occurrence of (a) a failure by Borrowers to repay all of the Obligations in full on the Maturity Date, or (b) an Event of Default and the election by Administrative Agent or the Required Lenders to require that payments and proceeds of Collateral be applied pursuant to Section 2.4(b)(iii)  of the Agreement.
“ ARC ” means Anixter Receivables Corporation, a Delaware corporation and a Subsidiary of Anixter.
“ ARC Subordinated Documents ” means the ARC Subordinated Note, that certain Security Agreement by ARC in favor of Anixter, and any other agreements, documents, and instruments executed and delivered in connection therewith.
“ ARC Subordinated Note ” means that certain Third Amended and Restated Subordinated Note executed by ARC and payable to the order of Anixter, as the same may be amended, modified or supplemented from time to time.
“ ARC Subordination Agreement ” means that certain Subordination and Intercreditor Agreement by and among Anixter, as the subordinated creditor, the Receivables Facility Administrative Agent, and ARC, as the same may be amended, modified or supplemented from time to time.
“ Assignee ” has the meaning specified therefor in Section 13.1(a)  of the Agreement.
“ Assignment and Acceptance ” means an Assignment and Acceptance Agreement substantially in the form of Exhibit A-1 to the Agreement.
 
Schedule 1.1
3

“ Attributable Indebtedness ” means, on any date, (a) in respect of any Capital Lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a Capital Lease.
“ Authorized Person ” means any one of the individuals identified on Schedule A-2 to the Agreement, as such schedule is updated from time to time by written notice from Borrowers to Administrative Agent.
“ Availability ” means, as of any date of determination, the amount that Borrowers are entitled to borrow as Revolving Loans under Section 2.1 of the Agreement (after giving effect to the then outstanding Revolver Usage).
“ Average Quarterly Combined Availability ” means, for any Fiscal Quarter, an amount equal to the average daily Combined Availability during such Fiscal Quarter.
“ Average Revolver Usage ” means, with respect to any period, the sum of the aggregate amount of Revolver Usage for each Business Day in such period (calculated as of the end of each respective Business Day) divided by the number of Business Days in such period.
“ AXE ” means Anixter International Inc., a Delaware corporation.
“ Bank Product ” means any one or more of the following financial products or accommodations extended to a Borrower or its Subsidiaries by a Bank Product Provider: (a) credit cards (including commercial cards (including so-called “purchase cards”, “procurement cards” or “p-cards”)), (b) credit card processing services, (c) debit cards, (d) stored value cards, (e) Cash Management Services, (f) transactions under Swap Agreements, or (g) Supply Chain Finance Arrangements.
“ Bank Product Agreements ” means those agreements entered into from time to time by a Borrower or its Subsidiaries with a Bank Product Provider in connection with the obtaining of any of the Bank Products.
“ Bank Product Collateralization ” means providing cash collateral (pursuant to documentation reasonably satisfactory to Administrative Agent) to be held by Administrative Agent for the benefit of the Bank Product Providers (other than the Swap Providers) in an amount determined by Administrative Agent as sufficient to satisfy the reasonably estimated credit exposure with respect to the then existing Bank Product Obligations (other than Swap Obligations).
“ Bank Product Obligations ” means (a) all obligations, liabilities, reimbursement obligations, fees, or expenses owing by each Borrower and its Subsidiaries to any Bank Product Provider pursuant to or evidenced by a Bank Product Agreement and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, (b) all Swap Obligations, and (c) all amounts that Administrative Agent or any Lender is obligated to pay to a Bank Product Provider as a result of Administrative Agent or such Lender purchasing participations from, or executing guarantees or indemnities or reimbursement obligations to, a Bank Product Provider with
 
Schedule 1.1
4

respect to the Bank Products provided by such Bank Product Provider to a Borrower or its Subsidiaries; provided , in order for any item described in clauses (a) , (b) , or (c)  above, as applicable, to constitute “Bank Product Obligations”, if the applicable Bank Product Provider is any Person other than Wells Fargo or its Affiliates, then (1) the applicable Bank Product must have been (A) provided before (and been outstanding as of) the Closing Date or (B) first provided after the Closing Date and (2) Administrative Agent shall have received a Bank Product Provider Agreement (A) within 10 days after the Closing Date, if the applicable Bank Product was provided before (and was outstanding as of) the Closing Date, or (B) within 10 days after the date of the provision of the applicable Bank Product to a Borrower or its Subsidiaries, if such Bank Product was first provided after the Closing Date.
“ Bank Product Provider ” means any Lender or any of its Affiliates, including each of the foregoing in its capacity, if applicable, as a Swap Provider; provided , that no such Person (other than Wells Fargo or its Affiliates) shall constitute a Bank Product Provider with respect to a Bank Product unless and until Administrative Agent receives a Bank Product Provider Agreement from such Person and with respect to the applicable Bank Product within 10 days after the provision of such Bank Product to a Borrower or its Subsidiaries; provided further , that if, at any time, a Lender ceases to be a Lender under the Agreement, then, from and after the date on which it ceases to be a Lender thereunder, neither it nor any of its Affiliates shall constitute Bank Product Providers and the obligations with respect to Bank Products provided by such former Lender or any of its Affiliates shall no longer constitute Bank Product Obligations.
“ Bank Product Provider Agreement ” means an agreement in substantially the form attached hereto as Exhibit B-2 to the Agreement, in form and substance satisfactory to Administrative Agent, duly executed by the applicable Bank Product Provider, Borrowers, and Administrative Agent.
“ Bank Product Reserves ” means, as of any date of determination, those reserves that Administrative Agent deems necessary or appropriate to establish (based upon the Bank Product Providers’ determination of the liabilities and obligations of each Borrower and its Subsidiaries in respect of Bank Product Obligations) in respect of Bank Products then provided or outstanding.
“ Bankruptcy Code ” means Title 11 of the United States Code, as in effect from time to time.
“ Bankruptcy Event ” means, with respect to any Person, when such Person becomes the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors, or similar Person charged with the reorganization or liquidation of its business, appointed for it, or, in the good faith determination of Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment; provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permits such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow, or disaffirm any contracts or agreements made by such Person.
“ Base Rate ” means the greatest of (a) the Federal Funds Rate plus  1 ⁄ 2 %, (b) the LIBOR Rate (which rate shall be calculated based upon an Interest Period of 3 months and shall be determined on a
 
Schedule 1.1
5

daily basis), plus 1 percentage point, and (c) the rate of interest announced, from time to time, within Wells Fargo at its principal office in San Francisco as its “prime rate”, with the understanding that the “prime rate” is one of Wells Fargo’s base rates (not necessarily the lowest of such rates) and serves as the basis upon which effective rates of interest are calculated for those loans making reference thereto and is evidenced by the recording thereof after its announcement in such internal publications as Wells Fargo may designate.
“ Base Rate Loan ” means each portion of the Revolving Loans that bears interest at a rate determined by reference to the Base Rate.
“ Benefit Plan ” means a defined benefit plan as defined in Section 3(35) of ERISA (other than a Multiemployer Plan) in respect of which Anixter or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an “employer” as defined in Section 3(5) of ERISA.
“ Board of Directors ” means, as to any Person, the board of directors (or comparable managers) of such Person, or any committee thereof duly authorized to act on behalf of the board of directors (or comparable managers).
“ Board of Governors ” means the Board of Governors of the Federal Reserve System of the United States (or any successor).
“ Borrower ” and “ Borrowers ” have the respective meanings specified therefor in the preamble to the Agreement.
“Borrower Materials” has the meaning specified therefor in Section 17.9(c) of the Agreement.
“Borrower Representative” has the meaning specified therefor in Section 17.13 of the Agreement.
“ Borrowing ” means a borrowing consisting of Revolving Loans made on the same day by the Lenders (or Administrative Agent on behalf thereof), or by Swing Lender in the case of a Swing Loan, or by Administrative Agent in the case of an Extraordinary Advance.
“ Borrowing Base ” means, as of any date of determination, the result of
(a) with respect to Eligible Inventory for which an appraisal (in each case, reasonably satisfactory to Administrative Agent) has been completed, the lesser of :
(i) the product of 75% multiplied by the value (calculated at the lower of cost or market on a basis consistent with Borrowers’ historical accounting practices) of such Eligible Inventory at such time; and
(ii) the product of 85% multiplied by the most recently determined Net Recovery Percentage identified in the most recent Inventory appraisal ordered and obtained by Administrative Agent multiplied by the value (calculated at the lower of cost or market on a basis consistent with Borrowers’ historical accounting practices) of such Eligible Inventory (such determination may be made as to different categories of such Eligible Inventory based upon the Net Recovery Percentage applicable to such categories) at such time, plus
 
Schedule 1.1
6

(b) with respect to Eligible Inventory for which an appraisal (in each case, reasonably satisfactory to Administrative Agent) has not been completed, the product of 40% multiplied by the value (calculated at the lower of cost or market on a basis consistent with Borrowers’ historical accounting practices) of such Eligible Inventory at such time, minus
(c) the aggregate amount of reserves, if any, established by Agent under Section 2.1(c) of the Agreement.
“ Borrowing Base Certificate ” means a certificate in the form of Exhibit B-1 .
“ Business Day ” means any day that is not a Saturday, Sunday, or other day on which banks are authorized or required to close in the state of Illinois, except that (i) if a determination of a Business Day shall relate to a LIBOR Rate Loan, the term “Business Day” also shall exclude any day on which banks are closed for dealings in Dollar deposits in the London interbank market, and (ii) any day that is not a “Business Day” under and as defined in the Receivables Facility Credit Agreement will not be a Business Day under the Agreement.
“ Capital Expenditures ” means, without duplication, any expenditure or commitment to expend money for any purchase or other acquisition of any asset which would be classified as a fixed or capital asset on a consolidated balance sheet of the Consolidated Group prepared in accordance with Agreement Accounting Principles.
“ Capital Lease ” means, as applied to any Person, any lease of any property (whether real, personal, or mixed) by that Person as lessee which, in conformity with Agreement Accounting Principles, is or should be accounted for as a capital lease on the balance sheet of that Person.
“ Cash Dominion Trigger Period ” has the meaning specified therefor in the Guaranty and Security Agreement.
“ Cash Equivalents ” means (a) marketable direct obligations issued or unconditionally guaranteed by the government of the United States or issued by an agency thereof and backed by the full faith and credit of the United States, in each case maturing within ninety (90) days after the date of acquisition thereof, (b) money market funds consisting primarily of marketable direct obligations issued by any state or local government of the United States maturing within ninety (90) days after the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, then from such other nationally recognized rating services acceptable to Administrative Agent) and not listed in “Credit Watch” published by S&P (or a similar publication of S&P or another nationally recognized rating service), (c) commercial paper (other than commercial paper issued by AXE, Anixter, or any Subsidiary of Anixter or any of their Affiliates), domestic and Eurodollar certificates of deposit, time deposits or bankers’ acceptances, in any such case maturing no more than ninety (90) days after the date of acquisition thereof and, at the time of the acquisition thereof, the issuer’s rating on its commercial paper is at least A-1 or P-1 from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, then the highest rating from other nationally recognized rating services acceptable to Administrative Agent); and (d) commercial paper (other than commercial paper issued by AXE, Anixter, or any Subsidiary of Anixter or any of their Affiliates), domestic and Eurodollar certificates of deposit, time deposits or bankers’ acceptances, in any such case maturing no more than ninety (90) days
 
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after the date of acquisition thereof and, at the time of the acquisition thereof, the issuer is a Lender and has a rating on its commercial paper of at least A-2 or P-2 from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, then the equivalent rating from other nationally recognized rating services acceptable to Administrative Agent), provided the amount of Cash Equivalents under this clause (d) shall not at any time exceed $5,000,000.
“ Cash Management Services ” means any cash management or related services including treasury, depository, return items, overdraft, controlled disbursement, merchant store value cards, e-payables services, electronic funds transfer, interstate depository network, automatic clearing house transfer (including the Automated Clearing House processing of electronic funds transfers through the direct Federal Reserve Fedline system) and other cash management arrangements.
“ Change in Control ” shall occur if:
(a) any “person,” as such term is defined in Section 13(d)(3) of the Securities Exchange Act, other than the Samuel Zell Group, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act), directly or indirectly, of 33% or more of the combined voting power of AXE’s or Anixter’s outstanding securities ordinarily having the right to vote at elections of directors, and such person at such time owns more of such combined voting power than the Samuel Zell Group; or
(b) individuals who, at the beginning of any period of twenty-four (24) consecutive months, constitute AXE’s board of directors (together with any new directors whose election by AXE’s board of directors or whose nomination for election by AXE’s shareholders was approved by a vote of at least a majority of the directors then still in office who either were directors at the beginning of such period or whose election or nomination was previously so approved) cease for any reason (other than death, disability or mandatory retirement) to constitute a majority of AXE’s board of directors then in office.
“ Change in Law ” means the occurrence after the date of the Agreement of: (a) the adoption or effectiveness of any law, rule, regulation, judicial ruling, judgment or treaty, (b) any change in any law, rule, regulation, judicial ruling, judgment or treaty or in the administration, interpretation, implementation or application by any Governmental Authority of any law, rule, regulation, guideline or treaty, or (c) the making or issuance by any Governmental Authority of any request, rule, guideline or directive, whether or not having the force of law; provided that notwithstanding anything in the Agreement to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (ii) all requests, rules, guidelines or directives concerning capital adequacy promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities shall, in each case, be deemed to be a “ Change in Law ,” regardless of the date enacted, adopted or issued.
“ Chase ” means JPMorgan Chase Bank, N.A., a national banking association.
“ Closing Date ” means the date of the making of the initial Revolving Loan (or other extension of credit) under the Agreement.
 
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“ Code ” means the Illinois Uniform Commercial Code, as in effect from time to time.
“ Collateral ” means all assets and interests in assets and proceeds thereof now owned or hereafter acquired by any Loan Party or its Subsidiaries in or upon which a Lien is granted by such Person in favor of Administrative Agent or the Lenders under any of the Loan Documents.
“ Collateral Access Agreement ” means a landlord waiver, bailee letter, or acknowledgement agreement of any lessor, warehouseman, processor, consignee, or other Person in possession of, having a Lien upon, or having rights or interests in any Borrower’s or its Subsidiaries’ books and records, Equipment, or Inventory, in each case, in form and substance reasonably satisfactory to Administrative Agent.
“ Collateral Documents ” means, collectively, the Guaranty and Security Agreement and any other agreements, instruments and documents executed in connection with this Agreement that are intended to create, perfect or evidence Liens to secure the Obligations, including all other security agreements, pledge agreements, mortgages, deeds of trust, loan agreements, notes, guarantees, subordination agreements, pledges, powers of attorney, consents, assignments, contracts, fee letters, notices, leases, financing statements and all other written matter whether theretofore, now or hereafter executed by any Loan Party and delivered to Administrative Agent.
“ Combined Availability ” means, at any time, an amount equal to (i) Receivables Facility Availability plus (ii) Availability, in each case at such time.
“ Combined Commitment ” means, at any time, an amount equal to (i) the Receivables Facility Commitment plus (ii) the aggregate Revolver Commitments, in each case at such time.
“ Commitment ” means, with respect to each Lender, its Revolver Commitment, and, with respect to all Lenders, their Revolver Commitments, in each case as such Dollar amounts are set forth beside such Lender’s name under the applicable heading on Schedule C-1 to the Agreement or in the Assignment and Acceptance pursuant to which such Lender became a Lender under the Agreement, as such amounts may be reduced or increased from time to time pursuant to assignments made in accordance with the provisions of Section 13.1 of the Agreement.
“ Confidential Information ” has the meaning specified therefor in Section 17.9(a)  of the Agreement.
“ Consolidated EBITDA ” means, for any period, for the Consolidated Group calculated in accordance with Agreement Accounting Principles, (a) Consolidated Net Income for such period taken as a single accounting period plus (b) the sum of the following, without duplication, to the extent deducted in determining Consolidated Net Income for such period: (i) the provision for depreciation and amortization expense of the Consolidated Group for such period, (ii) income taxes of the Consolidated Group for such period, and (iii) net interest expense of the Consolidated Group for such period; provided that there shall be excluded from Consolidated EBITDA any non-cash, non-operating gains or losses (including, without limitation, extraordinary or unusual gains or losses, gains or losses arising from the sale of capital assets or the sale of owned buildings and properties and other non-recurring gains or losses) during such period.
 
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“ Consolidated Fixed Charge Coverage Ratio ” means, as of any date of determination, the ratio of (a) Consolidated EBITDA minus Unfinanced Capital Expenditures to (b) the Consolidated Fixed Charges, in each case determined in accordance with Section 6.14 of the Agreement for the period of four (4) consecutive Fiscal Quarters ending on or immediately prior to such determination date.
“ Consolidated Fixed Charges ” means, for any period, without duplication, cash Interest Expense of the Consolidated Group, plus scheduled principal payments on Indebtedness actually made, plus consolidated yield or discount accrued on the outstanding aggregate investment or principal amount of claims held by purchasers, assignees or other transferees of (or of interests in) receivables of Anixter and its Subsidiaries in connection with any Receivables Facility Transaction (regardless of the accounting treatment of such Receivables Facility Transaction), plus expenses for taxes paid in cash, plus Capital Lease payments for such period, all calculated in accordance with Agreement Accounting Principles.
“ Consolidated Group ” means Anixter and each of its Subsidiaries.
“ Consolidated Net Income ” means, for any period, for the Consolidated Group on a consolidated basis, the net income of the Consolidated Group for that period, determined in accordance with Agreement Accounting Principles.
“ Consolidated Tangible Net Assets ” has the meaning attributed to that term in the 2012 Notes Indenture.
“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.
“ Customary Permitted Liens ” means:
(a) Liens (other than Environmental Liens, Liens imposed under ERISA or Enforceable Judgments) for Taxes not yet due or which are being contested in good faith by appropriate proceedings and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;
(b) statutory Liens of landlords, bankers, carriers, warehousemen, mechanics, materialmen and other Liens (other than Environmental Liens, Liens imposed under ERISA, or Enforceable Judgments) imposed by law, arising in the ordinary course of business and for amounts which (A) are not yet due, (B) are not more than thirty (30) days past due as long as no notice of default has been given or other action taken to enforce such Liens, or (C)(1) are not more than thirty (30) days past due and a notice of default has been given or other action taken to enforce such Liens, or (2) are more than thirty (30) days past due, and, in the case of clause (1) or (2), are being contested in good faith by appropriate proceedings which are sufficient to prevent imminent foreclosure of such Liens and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP;
(c) Liens (other than Environmental Liens, Liens imposed under ERISA, or Enforceable Judgments) incurred or deposits made in the ordinary course of business (including, without limitation, surety bonds and appeal bonds) in connection with workers’ compensation,
 
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unemployment insurance and other types of employment benefits or to secure the performance of tenders, bids, leases, contracts (other than for the repayment of Indebtedness), statutory obligations and other similar obligations or arising as a result of progress payments under government contracts;
(d) easements (including, without limitation, reciprocal easement agreements and utility agreements), rights-of-way, covenants, consents, rights of landlords, reservations, encroachments, variations and other restrictions, charges or encumbrances (whether or not recorded) affecting the use of real property, which do not materially interfere with the ordinary conduct of the business of Anixter or any Subsidiary of Anixter;
(e) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods; and
(f) precautionary filings of financing statements in connection with assets that are not owned by Anixter or its Subsidiaries (including in connection with Operating Leases entered into in the ordinary course of business).
“ Default ” means an event, condition, or default that, with the giving of notice, the passage of time, or both, would be an Event of Default.
“ Defaulting Lender ” means any Lender that (a) has failed, within two (2) Business Days of the date required to be funded or paid, to (i) fund any portion of its Loans, (ii) fund any portion of its participations in Letters of Credit or Swing Loans or (iii) pay over to any member of the Lender Group any other amount required to be paid by it hereunder, unless, in the case of clause (i) above, such Lender notifies Administrative Agent in writing that such failure is the result of such Lender’s good faith determination that a condition precedent to funding (specifically identified and including the particular Default, if any) has not been satisfied; (b) has notified any Loan Party or any member of the Lender Group in writing, or has made a public statement, to the effect that it does not intend or expect to comply with any of its funding obligations under this Agreement (unless such writing or public statement indicates that such position is based on such Lender’s good faith determination that a condition precedent (specifically identified and including the particular Default, if any) to funding a Loan under this Agreement cannot be satisfied) or generally under other agreements in which it commits to extend credit; (c) has failed, within three (3) Business Days after request by a member of the Lender Group, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations (and is financially able to meet such obligations) to fund prospective Loans and participations in then outstanding Letters of Credit and Swing Loans under this Agreement, provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt by such member of the Lender Group of such certification in form and substance satisfactory to it and Administrative Agent; or (d) has become, or has a direct or indirect parent that has become, the subject of a Bankruptcy Event.
“ Defaulting Lender Rate ” means (a) for the first 3 days from and after the date the relevant payment is due, the Base Rate, and (b) thereafter, the interest rate then applicable to Revolving Loans that are Base Rate Loans (inclusive of the Applicable Margin applicable thereto).
“ Deposit Account ” means any deposit account (as that term is defined in the Code).
 
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“ Designated Account ” means the Deposit Account of Anixter identified on Schedule D-1 to the Agreement (or such other Deposit Account of a Borrower located at Designated Account Bank that has been designated as such, in writing, by Borrowers to Administrative Agent).
“ Designated Account Bank ” has the meaning specified therefor in Schedule D-1 to the Agreement (or such other bank that is located within the United States that has been designated as such, in writing, by Borrowers to Administrative Agent).
“ Disclosed Matters ” means the actions, suits, proceedings and environmental matters disclosed in Schedule 4.6 .
“ Disposition ” or “ Dispose ” means the sale, transfer, license, or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.
“ Dollars ” or “ $ ” means United States dollars.
“ Domestic Subsidiary ” means a Subsidiary organized under the laws of a jurisdiction located in the United States.
“ Drawing Document ” means any Letter of Credit or other document presented for purposes of drawing under any Letter of Credit.
“ Eligible Inventory ” means Inventory of a Borrower that complies with each of the representations and warranties respecting Eligible Inventory made in the Loan Documents, and that is not excluded as ineligible by virtue of one or more of the excluding criteria set forth below; provided , that such criteria may be revised from time to time by Administrative Agent in Administrative Agent’s Permitted Discretion to address the results of any field examination or appraisal performed by Administrative Agent from time to time after the Closing Date. In determining the amount to be so included, Inventory shall be valued at the lower of cost or market on a basis consistent with Borrowers’ historical accounting practices. An item of Inventory shall not be included in Eligible Inventory if:
(a) a Borrower does not have good, valid, and marketable title thereto,
(b) a Borrower does not have actual and exclusive possession thereof (either directly or through a bailee or agent of a Borrower),
(c) it is not located at one of the locations in the continental United States set forth on Schedule 5.15 to the Agreement (or in-transit from one such location to another such location),
(d) it is in-transit to or from a location of a Borrower (other than in-transit from one location set forth on Schedule 5.15 to the Agreement to another location set forth on Schedule 5.15 to the Agreement),
(e) it is located on real property leased by a Borrower or in a contract warehouse, in each case, unless (i) either (A) it is subject to a Collateral Access Agreement executed by the lessor or warehouseman, as the case may be, or (B) if it is not subject to a Collateral Access
 
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Agreement executed by the lessor or warehouseman, as the case may be, Administrative Agent has the option, in its discretion, to institute a reserve for rent in accordance with Section 2.1(c) of the Agreement, and (ii) it is segregated or otherwise separately identifiable from goods of others, if any, stored on the premises,
(f) it is the subject of a bill of lading or other document of title,
(g) it is not subject to a valid and perfected first-priority Administrative Agent’s Lien (other than as the result of the existence of a Lien on such Inventory of the kind described in clause (a) or (b)  of the definition of the term “Customary Permitted Liens” that is the subject of a reserve established in accordance with Section 2.1(c) of the Agreement);
(h) it consists of goods returned or rejected by a Borrower’s customers,
(i) it consists of goods that are obsolete or slow moving, restrictive or custom items, work-in-process, raw materials, or goods that constitute spare parts, packaging and shipping materials, supplies used or consumed in Loan Parties’ business, bill and hold goods, defective goods, “seconds,” or Inventory acquired on consignment,
(j) it is subject to third-party trademark, licensing or other proprietary rights, unless Administrative Agent is satisfied that such Inventory can be freely sold by Administrative Agent on and after the occurrence of an Event of a Default despite such third-party rights,
(k) it was acquired in connection with an acquisition permitted by Section 6.4(a)(v) of the Agreement, until the completion of an appraisal and field examination of such Inventory, in each case, reasonably satisfactory to Administrative Agent (which appraisal and field examination may be conducted prior to the closing of such acquisition), or
(l) it consists of goods acquired from any Sanctioned Person.
“ Enforceable Judgment ” means a judgment or order as to which (a) Anixter has not demonstrated to the reasonable satisfaction of the Required Lenders that Anixter and its Subsidiaries, as applicable, are covered by third-party insurance (other than retro-premium insurance) therefor and (b) the period, if any, during which the enforcement of such judgment or order is stayed shall have expired, it being understood that a judgment or order which is under appeal or as to which the time in which to perfect an appeal has not expired shall not be deemed an “Enforceable Judgment” so long as enforcement thereof is effectively stayed pending the outcome of such appeal or the expiration of such period, as the case may be; provided that if enforcement of a judgment or order has been stayed on condition that a bond or collateral equal to or greater than $35,000,000 be posted or provided, such judgment or order shall immediately be an “Enforceable Judgment.”
“ Enhanced Reporting Trigger Period ” means a period (a) commencing (i) automatically upon the occurrence of a Specified Event of Default, (ii) at the written election of Required Lenders upon the occurrence of any other Event of Default, or (iii) when Combined Availability is less than the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment and (b) continuing until (i) no Event of Default is then continuing, and (ii) Combined Availability remains in excess of the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment for thirty (30) consecutive days. An Enhanced Reporting Trigger Period may be discontinued no more than five (5) times during the term of the Agreement.
 
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“ Environmental Laws ” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, binding agreements issued, promulgated or entered into by any Governmental Authority applicable to any Loan Party or any Loan Party’s operations, relating to the environment, preservation or reclamation of natural resources, the management, Release or threatened Release of any Hazardous Material, and all Permits issued in connection therewith.
“ Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of Anixter or any Subsidiary of Anixter incurred as a result of (a) any violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) the Release or threatened Release of any Hazardous Materials into the environment, or (d) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
“ Environmental Lien ” means a Lien in favor of any Governmental Authority for any Environmental Liability.
“ Equity Interest ” means, with respect to a Person, all of the shares, options, warrants, interests, participations, or other equivalents (regardless of how designated) of or in such Person, whether voting or nonvoting, including capital stock (or other ownership or profit interests or units), preferred stock, or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the SEC under the Securities Exchange Act).
“ ERISA ” means the Employee Retirement Income Security Act of 1974, and any regulations issued pursuant thereto, as amended from time to time.
“ ERISA Affiliate ” means any (i) corporation which is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the IRC) as Anixter or any of its Subsidiaries, (ii) partnership or other trade or business (whether or not incorporated) under common control (within the meaning of Section 414(c) of the IRC) with Anixter or any of its Subsidiaries, and (iii) member of the same affiliated service group (within the meaning of Section 414(m) of the IRC) as Anixter or any of its Subsidiaries, any corporation described in clause (i) above or any partnership or trade or business described in clause (ii) above.
“ ERISA Event ” means (a) any Reportable Event with respect to any Plan; (b) the failure to make the “minimum required contributions” under Section 412 or 430 of the IRC or Section 302 of ERISA, whether or not waived; (c) the filing pursuant to Section 412(c) of the IRC or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by Anixter or any ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) any Termination Event; or (f) the receipt by Anixter or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from Anixter or any ERISA Affiliate of any notice, concerning the imposition of withdrawal liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
 
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“ Event of Default ” has the meaning specified therefor in Section 8 of the Agreement.
“ Excluded Subsidiary ” means (a) ARC, (b) Anixter Financial Inc., a Delaware corporation and a Subsidiary of Anixter, and each of its Subsidiaries, (c) subject to Section 5.16 of the Agreement, APSGP, LLC, a Florida limited liability company and a Subsidiary of Anixter, (d) each other Domestic Subsidiary of Anixter that owns no assets other than, and engages in no business other than owning, the Equity Interests of one or more Foreign Subsidiaries of Anixter, and (e) each Foreign Subsidiary of Anixter.
“ Excluded Taxes ” means (i) any tax imposed on the net income or net profits of any Lender or any Participant (including any branch profits taxes), in each case imposed by the jurisdiction (or by any political subdivision or taxing authority thereof) in which such Lender or such Participant is organized or the jurisdiction (or by any political subdivision or taxing authority thereof) in which such Lender’s or such Participant’s principal office or applicable lending office is located, in each case as a result of a present or former connection between such Lender or such Participant and the jurisdiction or taxing authority imposing the tax (other than any such connection arising solely from such Lender or such Participant having executed, delivered or performed its obligations or received payment under, or enforced its rights or remedies under the Agreement or any other Loan Document); (ii) taxes resulting from a Lender’s or a Participant’s failure to comply with the requirements of Section 16.2 of the Agreement, (iii) any United States federal withholding taxes that would be imposed on amounts payable to a Foreign Lender based upon the applicable withholding rate in effect at the time such Foreign Lender becomes a party to the Agreement (or designates a new lending office), except that Taxes shall include (A) any amount that such Foreign Lender (or its assignor, if any) was previously entitled to receive pursuant to Section 16.1 of the Agreement, if any, with respect to such withholding tax at the time such Foreign Lender becomes a party to the Agreement (or designates a new lending office), and (B) additional United States federal withholding taxes that may be imposed after the time such Foreign Lender becomes a party to the Agreement (or designates a new lending office), as a result of a change in law, rule, regulation, order or other decision with respect to any of the foregoing by any Governmental Authority, and (iv) any United States federal withholding taxes imposed under FATCA.
“ Existing Letters of Credit ” means those letters of credit described on Schedule E-2 to the Agreement.
“ Extraordinary Advances ” has the meaning specified therefor in Section 2.3(d)(iii)  of the Agreement.
“ FATCA ” means Sections 1471 through 1474 of the IRC, as of the date of the Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof.
“ Fee Letter ” means that certain fee letter, dated as of even date with the Agreement, among Borrowers and Administrative Agent, in form and substance reasonably satisfactory to Administrative Agent.
“ Federal Funds Rate ” means, for any period, the greater of (a) 0% and (b) a fluctuating interest rate per annum equal to, for each day during such period, the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds
 
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brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by Administrative Agent from three Federal funds brokers of recognized standing selected by it.
“ Financial Covenant Trigger Period ” means a period (a) commencing (i) automatically upon the occurrence of a Specified Event of Default, (ii) at the written election of Required Lenders upon the occurrence of any other Event of Default, or (iii) when Combined Availability is less than the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment and (b) continuing until (i) no Event of Default is then continuing, and (ii) Combined Availability remains in excess of the greater of (A) $75,000,000 and (B) 10% of the Combined Commitment for thirty (30) consecutive days. A Financial Covenant Trigger Period may be discontinued no more than five (5) occasions during the term of the Agreement.
“ Financial Officer ” means, with respect to any Person, any of the chief financial officer, controller or treasurer of such Person and, with respect to Anixter shall include its Vice President-Finance and the Assistant Treasurer.
“ Fiscal Month ” means a four- or five-week monthly accounting period of Anixter ending on or about the last day of a calendar month.
“ Fiscal Quarter ” means a 13-week (or, as the case may be, periodically a 14-week) accounting period of Anixter ending on or about March 31, June 30, September 30 or December 31 of any Fiscal Year.
“ Fiscal Year ” means the fiscal year of Anixter, which shall be the annual accounting period of Anixter ending on or about December 31 of each year.
“ Foreign Employee Benefit Plan ” means any plan, program, policy, agreement or contract maintained or contributed to or for the benefit of employees or Anixter, any of its Subsidiaries, or any ERISA Affiliate which is governed by the laws of a jurisdiction outside the United States.
“ Foreign Lender ” means any Lender or Participant that is not a United States person within the meaning of Section 7701(a)(30) of the IRC.
“ Foreign Pension Plan ” means any pension plan or other deferred compensation plan, program or arrangement maintained or contributed to or for the benefit of employees of Anixter, any of its Subsidiaries, or any ERISA Affiliate, which, under the applicable local law, is required to be funded through a trust or other funding vehicle and which is governed by the laws of a jurisdiction outside the United States.
“ Foreign Subsidiary ” means any Subsidiary which is not a Domestic Subsidiary.
“ Funding Date ” means the date on which a Borrowing occurs.
“ Funding Losses ” has the meaning specified therefor in Section 2.12(b)(ii) of the Agreement.
 
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“ GAAP ” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.
“ Governmental Authority ” means the government of the United States, any other nation, or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of, or pertaining to, government.
“ Guarantor ” means (a) AXE, (b) each Subsidiary of Anixter (other than a Borrower) that is signatory to the Guaranty and Security Agreement as of the date hereof, and (c) each other Person that becomes a guarantor after the Closing Date pursuant to Section 5.14 of the Agreement.
“ Guaranty and Security Agreement ” means a guaranty and security agreement, dated as of even date with the Agreement, in form and substance reasonably satisfactory to Administrative Agent, executed and delivered by each of the Borrowers and each of the Guarantors to Administrative Agent.
“ Hazardous Materials ” means: (a) any substance, material, or waste that is included within the definitions of “hazardous substances,” “hazardous materials,” “hazardous waste,” “toxic substances,” “toxic materials,” “toxic waste,” or words of similar import in any Environmental Law; (b) those substances listed as hazardous substances by the U.S. Department of Transportation (or any successor agency) (49 C.F.R. 172.101 and amendments thereto) or by the Environmental Protection Agency (or any successor agency) (40 C.F.R. Part 302 and amendments thereto); and (c) any substance, material, or waste that is petroleum or a petroleum by-product, friable asbestos, polychlorinated biphenyls, radioactive or freon gas.
“ HD Supply Acquisition ” means the purchase by Anixter of the outstanding Equity Interests of each of HDS PS, HDS Power Solutions, and Pro Canadian Holdings I, ULC, a Nova Scotia unlimited liability company (“ Pro Canadian ” and, together with HDS PS and HDS Power Solutions, each, a “ Target ”), and certain assets used in or held for use in the power solutions business of the Targets but owned by one or more affiliates of the Targets (which assets are the “Purchased Assets” under and as defined in the HD Supply Acquisition Agreement).
“ HD Supply Acquisition Agreement ” means a Purchase Agreement dated as of July 15, 2015, by and among the HD Supply Sellers, as sellers, and Anixter, as buyer.
“ HD Supply Acquisition Agreement Representations ” means those representations and warranties made by any of the sellers and their Subsidiaries in the HD Supply Acquisition Agreement, to the extent Anixter has a right under the HD Supply Acquisition Agreement (a) not to consummate the transactions contemplated by the HD Supply Acquisition Agreement or (b) to terminate Anixter’s obligations under the HD Supply Acquisition Agreement, in each case, as a result of a breach of such representation or warranty made by any of the sellers and their Subsidiaries in the HD Supply Acquisition Agreement.
 
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“ HD Supply Acquisition Documents ” means (a) the HD Supply Acquisition Agreement, and (b) all other agreements, instruments, documents, and certificates required to be executed and delivered as conditions precedent to the effectiveness of the HD Supply Acquisition Agreement or to the consummation of the HD Supply Acquisition.
“ HD Supply Sellers ” means HD Supply, Inc., HD Supply Holdings, LLC, HD Supply GP & Management, Inc., HD Supply Power Solutions Group, Inc., and BRAFASCO Holdings II, Inc.
“ HDS PS ” means HD Supply Power Solutions, Ltd., a Florida limited partnership. Substantially concurrently with the consummation of the HD Supply Acquisition, HDS PS will convert into a Florida limited liability company and change its name to “Anixter Power Solutions, LLC.”
“ HDS Power Solutions ” means HDS Power Solutions, Inc., a Michigan corporation. Substantially concurrently with the consummation of the HD Supply Acquisition, HDS Power Solutions will change its name to “Anixter Power Solutions Inc.”
“ Indebtedness ” means, as to any Person at a particular time, all of the following (without duplication):
(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;
(b) any direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), banker’s acceptances, bank guaranties, surety bonds and similar instruments;
(c) net obligations under any Swap Agreement in an amount equal to (i) if such Swap Agreement has been closed out, the termination value thereof, or (ii) if such Swap Agreement has not been closed out, the mark-to-market value thereof determined on the basis of readily available quotations provided by any recognized dealer in such Swap Agreement;
(d) whether or not so included as liabilities in accordance with GAAP, all obligations of such Person to pay the deferred purchase price of property or services, and indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;
(e) Capital Leases and Synthetic Lease Obligations;
(f) the outstanding aggregate investment or principal amount of claims held by purchasers, assignees or transferees of (or of interests in) receivables of such Person in connection with any Receivables Facility Transaction; and
(g) all Accommodation Obligations of such Person in respect of any of the foregoing.
 
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For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person except for customary exceptions acceptable to the Required Lenders. The amount of any Capital Lease or Synthetic Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.
“ Indemnified Liabilities ” has the meaning specified therefor in Section 10.3 of the Agreement.
“ Indemnified Person ” has the meaning specified therefor in Section 10.3 of the Agreement.
“ Indemnified Taxes ” means any Taxes other than Excluded Taxes.
“ Insolvency Proceeding ” means any proceeding commenced by or against any Person under any provision of the Bankruptcy Code or under any other state or federal bankruptcy or insolvency law, assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or proceedings seeking reorganization, arrangement, or other similar relief.
“ Intercreditor Agreement ” means that certain Intercreditor Agreement dated as of the date of this Agreement between Chase, as the Receivables Facility Administrative Agent, and Wells Fargo, as Administrative Agent, and acknowledged and agreed to by the Loan Parties and ARC, substantially in the form of Exhibit I-1 to the Agreement, as the same may be amended or replaced from time to time.
“ Interest Expense ” means, for any period, total interest expense (including that attributable to Capital Lease Obligations, Synthetic Lease Obligations and commitment fees) of the Consolidated Group for such period with respect to all outstanding Indebtedness of the Consolidated Group (including all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptances and net costs under Swap Agreements in respect of interest rates to the extent such net costs are allocable to such period in accordance with Agreement Accounting Principles), calculated on a consolidated basis for the Consolidated Group for such period in accordance with Agreement Accounting Principles.
“ Interest Period ” means, with respect to each LIBOR Rate Loan, a period commencing on the date of the making of such LIBOR Rate Loan (or the continuation of a LIBOR Rate Loan or the conversion of a Base Rate Loan to a LIBOR Rate Loan) and ending 1, 2, 3, or 6 months thereafter; provided , that (a) interest shall accrue at the applicable rate based upon the LIBOR Rate from and including the first day of each Interest Period to, but excluding, the day on which any Interest Period expires, (b) any Interest Period that would end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day, (c) with respect to an Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period), the Interest Period shall end on the last Business Day of the calendar month that is 1, 2, 3, or 6 months after the date on which the Interest Period began, as applicable, and (d) Borrowers may not elect an Interest Period which will end after the Maturity Date.
“ Inventory ” means inventory (as that term is defined in the Code).
 
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“ Inventory Reserves means, as of any date of determination, (a) Landlord Reserves, and (b) those reserves that Administrative Agent deems necessary or appropriate, in its Permitted Discretion and subject to Section 2.1(c) of the Agreement, to establish and maintain (including reserves for slow moving Inventory and Inventory shrinkage) with respect to Eligible Inventory or the Maximum Revolver Amount.
“ Investment ” has the meaning assigned to such term in Section 6.4(a) of the Agreement.
“ IRC ” means the Internal Revenue Code of 1986, as amended, and any successor statutes, and all regulations and guidance promulgated thereunder. Any reference to a specific section of the IRC shall be deemed to be a reference to such section of the IRC and any successor statutes, and all regulations and guidance promulgated thereunder.
“ ISP ” means, with respect to any Letter of Credit, the International Standby Practices 1998 (International Chamber of Commerce Publication No. 590) and any subsequent revision thereof adopted by the International Chamber of Commerce on the date such Letter of Credit is issued.
“ Issuer Document ” means, with respect to any Letter of Credit, a letter of credit application, a letter of credit agreement, or any other document, agreement or instrument entered into (or to be entered into) by a Borrower in favor of Issuing Bank and relating to such Letter of Credit.
“ Issuing Bank ” means Wells Fargo or any other Lender that, at the request of Borrowers and with the consent of Administrative Agent, agrees, in such Lender’s sole discretion, to become an Issuing Bank for the purpose of issuing Letters of Credit pursuant to Section 2.11 of the Agreement, and Issuing Bank shall be a Lender.
“ Joint Book Runners ” has the meaning set forth in the preamble to the Agreement.
“ Joint Lead Arrangers ” has the meaning set forth in the preamble to the Agreement.
“ JPMorgan ” means JPMorgan Chase Bank, N.A., a national banking association.
“ Landlord Reserve ” means, as to each location at which a Borrower has Inventory or books and records located and as to which a Collateral Access Agreement has not been received by Administrative Agent, a reserve in an amount equal to the greater of (a) the number of months’ rent for which the landlord will have, under applicable law, a Lien in the Inventory of such Borrower to secure the payment of rent or other amounts under the lease relative to such location, or (b) 3 months’ rent under the lease relative to such location.
“ Lender ” has the meaning set forth in the preamble to the Agreement, shall include Issuing Bank and the Swing Lender, and shall also include any other Person made a party to the Agreement pursuant to the provisions of Section 13.1 of the Agreement and “ Lenders ” means each of the Lenders or any one or more of them.
“ Lender Group ” means each of the Lenders (including Issuing Bank and the Swing Lender) and Administrative Agent, or any one or more of them.
“ Lender Group Expenses ” means, without duplication, all (a) reasonable out-of-pocket expenses incurred by the Administrative Agent and its Affiliates, including the reasonable fees, charges, and
 
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disbursements of counsel for the Administrative Agent, in connection with the syndication and distribution (including, without limitation, via the internet or through the Platform) of the credit facilities provided for in the Agreement, the preparation and administration of the Loan Documents, and any amendments, modifications, or waivers of the provisions of the Loan Documents (whether or not the transactions contemplated by the Agreement or thereby are consummated); (b) reasonable out-of-pocket expenses incurred by Issuing Bank in connection with the issuance, amendment, renewal, or extension of any Letter of Credit or any demand for payment thereunder; (c) out-of-pocket expenses incurred by the Lender Group (including the fees, charges, and disbursements of any counsel for the Lender Group) in connection with the enforcement, collection, or protection of the Lender Group’s rights in connection with the Loan Documents, or in connection with the Loans made or Letters of Credit issued under the Agreement, including all such out-of-pocket expenses incurred during any workout, restructuring, or negotiations in respect of such Loans or Letters of Credit; and (d) Administrative Agent’s reasonable out-of-pocket costs and expenses (including the fees, charges, and disbursements of any counsel for Administrative Agent) relative to third-party claims or any other lawsuit or adverse proceeding paid or incurred, whether in enforcing or defending the Loan Documents or otherwise in connection with the transactions contemplated by the Loan Documents, Administrative Agent’s Liens in and to the Collateral, or the Lender Group’s relationship with AXE, Anixter, or any of Anixter’s Subsidiaries. The fees and expenses of counsel that shall constitute Lender Group Expenses shall in any event be limited to one primary counsel, one local counsel in each reasonably necessary jurisdiction, one specialty counsel in each reasonably necessary specialty area, and one or more additional counsel if one or more conflicts of interest arise. Lender Group Expenses include, without limiting the generality of the foregoing, fees, costs, and expenses incurred in connection with the following: (i) appraisals and insurance reviews; (ii) field examinations and the preparation of Reports based on the fees charged by a third party retained by Administrative Agent or the internally allocated fees for each Person employed by Administrative Agent with respect to each field examination; (iii) background checks regarding senior management and/or key investors, as deemed necessary or appropriate in the sole discretion of Administrative Agent; (iv) Taxes, fees, and other charges for (A) lien and title searches and title insurance and (B) recording the mortgages, filing financing statements and continuations, and taking other actions to perfect, protect, and continue Administrative Agent’s Liens; (v) sums paid or incurred to take any action required of any of the Loan Parties under the Loan Documents that the Loan Parties fail to pay or take; and (vi) forwarding loan proceeds, collecting checks and other items of payment, and establishing and maintaining the accounts and lock boxes, and costs and expenses of preserving and protecting the Collateral.
“ Lender Group Representatives ” has the meaning specified therefor in Section 17.9 of the Agreement.
“ Lender-Related Person ” means, with respect to any Lender, such Lender, together with such Lender’s Affiliates, officers, directors, employees, attorneys, and agents.
“ Letter of Credit ” means a letter of credit (as that term is defined in the Code) issued by Issuing Bank.
“ Letter of Credit Collateralization ” means either (a) providing cash collateral (pursuant to documentation reasonably satisfactory to Administrative Agent, including provisions that specify that the Letter of Credit Fees and all commissions, fees, charges and expenses provided for in Section 2.11(k)  of the Agreement (including any fronting fees) will continue to accrue while the Letters of Credit are
 
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outstanding) to be held by Administrative Agent for the benefit of the Revolving Lenders in an amount equal to 103% of the then existing Letter of Credit Usage, (b) delivering to Administrative Agent documentation executed by all beneficiaries under the Letters of Credit, in form and substance reasonably satisfactory to Administrative Agent and Issuing Bank, terminating all of such beneficiaries’ rights under the Letters of Credit, or (c) providing Administrative Agent with a standby letter of credit, in form and substance reasonably satisfactory to Administrative Agent, from a commercial bank acceptable to Administrative Agent (in its sole discretion) in an amount equal to 103% of the then existing Letter of Credit Usage (it being understood that the Letter of Credit Fee and all fronting fees set forth in the Agreement will continue to accrue while the Letters of Credit are outstanding and that any such fees that accrue must be an amount that can be drawn under any such standby letter of credit).
“ Letter of Credit Disbursement ” means a payment made by Issuing Bank pursuant to a Letter of Credit.
“ Letter of Credit Exposure ” means, as of any date of determination with respect to any Lender, such Lender’s Pro Rata Share of the Letter of Credit Usage on such date.
“ Letter of Credit Fee ” has the meaning specified therefor in Section 2.6(b)  of the Agreement.
“ Letter of Credit Indemnified Costs ” has the meaning specified therefor in Section 2.11(f)  of the Agreement.
“ Letter of Credit Related Person ” has the meaning specified therefor in Section 2.11(f)  of the Agreement.
“ Letter of Credit Usage ” means, as of any date of determination, the aggregate undrawn amount of all outstanding Letters of Credit.
“ LIBOR Deadline ” has the meaning specified therefor in Section 2.12(b)(i)  of the Agreement.
“ LIBOR Notice ” means a written notice in the form of Exhibit L-1 to the Agreement.
“ LIBOR Option ” has the meaning specified therefor in Section 2.12(a)  of the Agreement.
“ LIBOR Rate ” means the rate per annum as reported on Reuters Screen LIBOR01 page (or any successor page) 2 Business Days prior to the commencement of the requested Interest Period, for a term, and in an amount, comparable to the Interest Period and the amount of the LIBOR Rate Loan requested (whether as an initial LIBOR Rate Loan or as a continuation of a LIBOR Rate Loan or as a conversion of a Base Rate Loan to a LIBOR Rate Loan) by Borrowers in accordance with the Agreement (and, if any such rate is below zero, the LIBOR Rate shall be deemed to be zero), which determination shall be made by Administrative Agent and shall be conclusive in the absence of manifest error.
“ LIBOR Rate Loan ” means each portion of a Revolving Loan that bears interest at a rate determined by reference to the LIBOR Rate.
“ Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), Environmental Lien, Enforceable Judgment, charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including
 
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any conditional sale or other title retention agreement, the interest of a lessor under a Capital Lease, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of any financing statement under the Uniform Commercial Code or comparable laws of any jurisdiction), including the interest of a purchaser of accounts receivable.
“ Loan ” shall mean any Revolving Loan, Swing Loan, or Extraordinary Advance made (or to be made) hereunder.
“ Loan Account ” has the meaning specified therefor in Section 2.9 of the Agreement.
“ Loan Documents ” means the Agreement, any Borrowing Base Certificate, the Fee Letter, the Collateral Documents, the Intercreditor Agreement, any Issuer Documents, the Letters of Credit, any note or notes executed by Borrowers in connection with the Agreement and payable to any member of the Lender Group, and any other instrument or agreement entered into, now or in the future, by any Loan Party or any of its Subsidiaries and any member of the Lender Group in connection with the Agreement.
“ Loan Party ” means any Borrower or any Guarantor.
“ Margin Stock ” as defined in Regulation U of the Board of Governors as in effect from time to time.
“ Material Accounting Changes ” has the meaning specified therefor in the definition of “Agreement Accounting Principles.”
“ Material Adverse Effect ” means (a) a material adverse change in, or a material adverse effect upon, the operations, assets, liabilities (actual or contingent), business, properties, financial condition or prospects of AXE, Anixter, and their Subsidiaries taken as a whole; (b) a material impairment of the ability of the Loan Parties (taken as a whole) to perform the obligations of the Loan Parties under the Loan Documents; (c) a material impairment of the ability of the Receivables Facility Loan Parties (taken as a whole) to perform the obligations of all Receivables Facility Loan Parties under the Receivables Facility; (d) a material adverse effect upon the legality, validity, binding effect, or enforceability against any Loan Party of any Loan Document to which it is a party or the rights and remedies of Administrative Agent or the Lenders under the Loan Documents; or (e) a material adverse effect on the Collateral or Administrative Agent’s Liens (on behalf of itself and the Lenders) on the Collateral or the priority of such Liens.
“ Material Indebtedness ” means (a) the Indebtedness under the Receivables Facility; (b) the Indebtedness in respect of Swap Agreements to the extent included as “Bank Product Obligations.” (c) Indebtedness under the 2012 Notes Indenture, and (d) other Indebtedness (other than the Loans and Letters of Credit), or obligations in respect of one or more Swap Agreements, of any one or more of Anixter and its Subsidiaries in an aggregate principal amount exceeding $50,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of Anixter or any Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that Anixter or such Subsidiary would be required to pay if such Swap Agreement were terminated at such time.
 
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“ Material Transaction ” means any sale, assignment, transfer, conveyance or other disposition of (a) assets of any member of the Consolidated Group or (b) capital stock of any member of the Consolidated Group which, when combined with all such other sales, assignments, transfers, conveyances or other dispositions in the immediately preceding twelve Fiscal Months represents the disposition of an amount which is greater than ten percent (10.0%) of the Consolidated Group’s (1) assets or (2) revenues.
“ Maturity Date ” means October 5, 2020.
“ Maximum Revolver Amount ” means $150,000,000, decreased by the amount of reductions in the Revolver Commitments made in accordance with Section 2.4(c)  of the Agreement.
“ Moody’s ” means Moody’s Investors Service, Inc.
“ Multiemployer Plan ” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA which is, or within the immediately preceding six (6) years was, contributed to by Anixter or any ERISA Affiliate.
“ Net Recovery Percentage ” means, as of any date of determination, the percentage of the book value of Borrowers’ Inventory that is estimated to be recoverable in an orderly liquidation of such Inventory net of all associated costs and expenses of such liquidation, such percentage to be determined as to each category of Inventory and to be as specified in the most recent appraisal received by Administrative Agent from an appraisal company selected by Administrative Agent.
“ Non-Consenting Lender ” has the meaning specified therefor in Section 14.2(a)  of the Agreement.
“ Non-Defaulting Lender ” means each Lender other than a Defaulting Lender.
“ Obligations ” means (a) all loans (including the Revolving Loans (inclusive of Extraordinary Advances and Swing Loans)), debts, principal, interest (including any interest that accrues after the commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding), reimbursement or indemnification obligations with respect to Letters of Credit (irrespective of whether contingent), premiums, liabilities (including all amounts charged to the Loan Account pursuant to the Agreement), obligations (including indemnification obligations), fees (including the fees provided for in the Fee Letter), Lender Group Expenses (including any fees or expenses that accrue after the commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding), guaranties, and all covenants and duties of any other kind and description owing by any Loan Party arising out of, under, pursuant to, in connection with, or evidenced by the Agreement or any of the other Loan Documents and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all interest not paid when due and all other expenses or other amounts that Borrowers are required to pay or reimburse by the Loan Documents or by law or otherwise in connection with the Loan Documents, and (b) all Bank Product Obligations. Without limiting the generality of the foregoing, the Obligations of Borrowers under the Loan Documents include the obligation to pay (i) the principal of the Revolving Loans, (ii) interest accrued on the Revolving Loans, (iii) the amount necessary to reimburse Issuing Bank for amounts paid or payable pursuant to Letters of Credit, (iv) Letter of Credit commissions, fees
 
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(including fronting fees) and charges, (v) Lender Group Expenses, (vi) fees payable under the Agreement or any of the other Loan Documents, and (vii) indemnities and other amounts payable by any Loan Party under any Loan Document. Any reference in the Agreement or in the Loan Documents to the Obligations shall include all or any portion thereof and any extensions, modifications, renewals, or alterations thereof, both prior and subsequent to any Insolvency Proceeding.
“ OFAC ” means the Office of Foreign Assets Control of the U.S. Department of the Treasury.
“ Operating Lease ” means, as applied to any Person, any lease of any Property by that Person as lessee which is not a Capital Lease.
“ Organization Documents ” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-US jurisdiction), (b) with respect to any limited liability company, the certificate, memorandum and articles of association or articles of formation or organization and operating agreement, and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity, in each case as amended from time to time.
“ Originating Lender ” has the meaning specified therefor in Section 13.1(e)  of the Agreement.
“ Originator ” means each “Originator” under and as defined in the Receivables Facility Credit Agreement.
“ Overadvance ” means, as of any date of determination, that the Revolver Usage is greater than any of the limitations set forth in Section 2.1 or Section 2.11 of the Agreement.
“ Participant ” has the meaning specified therefor in Section 13.1(e)  of the Agreement.
“ Participant Register ” has the meaning set forth in Section 13.1(i)  of the Agreement.
“ Patriot Act ” has the meaning specified therefor in Section 4.13 of the Agreement.
“ Payment Conditions ” means, with respect to any proposed event that is subject to satisfaction of the Payment Conditions, that either (a) after giving effect to the proposed event as if it occurred on the first day of the Pro Forma Period, pro forma Combined Availability would be greater than 20% of the Combined Commitment at all times during the Pro Forma Period, or (b) after giving effect to the proposed event as if it occurred on the first day of the Pro Forma Period, (i) pro forma Combined Availability at all times during the Pro Forma Period would be greater than 15% of the Combined Commitment and (ii) the pro forma Consolidated Fixed Charge Coverage Ratio would be greater than 1.1 to 1.
“ PBGC ” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
 
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“ Pension Plan ” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by Anixter or any ERISA Affiliate or to which Anixter or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer plan (as described in Section 4064(a) of ERISA) has made contributions at any time during the immediately preceding five plan years.
“ Perfection Certificate ” means a certificate in the form of Exhibit P-1 to the Agreement.
“ Permit ” means any permit, approval, consent, authorization, license, variance, or permission required from a Governmental Authority under an applicable Requirement of Law.
“ Permitted Discretion ” means a determination made in good faith and in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment.
“ Permitted Encumbrances ” means:
(a) Customary Permitted Liens; and
(b) judgment Liens in respect of judgments that do not constitute an Event of Default under clause (k) of Section 8 of the Agreement.
provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness, except with respect to clause (b) above.
“ Person ” means natural persons, corporations, limited liability companies, limited partnerships, general partnerships, limited liability partnerships, joint ventures, trusts, land trusts, business trusts, Governmental Authorities, or other organizations, irrespective of whether they are legal entities, and governments and agencies and political subdivisions thereof.
“ Plan ” means an employee benefit plan defined in Section 3(3) of ERISA in respect of which either Anixter or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an “employer” as defined in Section 3(5) of ERISA.
“ Platform ” has the meaning specified therefor in Section 17.9(c)  of the Agreement.
“ Pro Forma Period ” means the period commencing thirty (30) days prior to the date an event is proposed by Anixter to occur.
“ Pro Rata Share ” means, as of any date of determination:
(a) with respect to a Lender’s obligation to make all or a portion of the Revolving Loans, with respect to such Lender’s right to receive payments of interest, fees, and principal with respect to the Revolving Loans, and with respect to all other computations and other matters related to the Revolver Commitments or the Revolving Loans, the percentage obtained by dividing (i) the Revolving Loan Exposure of such Lender by (ii) the aggregate Revolving Loan Exposure of all Lenders,
 
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(b) with respect to a Lender’s obligation to participate in the Letters of Credit, with respect to such Lender’s obligation to reimburse Issuing Bank, and with respect to such Lender’s right to receive payments of Letter of Credit Fees, and with respect to all other computations and other matters related to the Letters of Credit, the percentage obtained by dividing (i) the Revolving Loan Exposure of such Lender by (ii) the aggregate Revolving Loan Exposure of all Lenders; provided , that if all of the Revolving Loans have been repaid in full and all Revolver Commitments have been terminated, but Letters of Credit remain outstanding, Pro Rata Share under this clause shall be determined as if the Revolver Commitments had not been terminated and based upon the Revolver Commitments as they existed immediately prior to their termination,
(c) [reserved],
(d) with respect to all other matters and for all other matters as to a particular Lender (including the indemnification obligations arising under Section 15.7 of the Agreement), the percentage obtained by dividing (i) the Revolving Loan Exposure of such Lender by (ii) the aggregate Revolving Loan Exposure of all Lenders, in any such case as the applicable percentage may be adjusted by assignments permitted pursuant to Section 13.1 of the Agreement; provided , that if all of the Loans have been repaid in full, all Letters of Credit have been made the subject of Letter of Credit Collateralization, and all Commitments have been terminated, Pro Rata Share under this clause shall be determined as if the Revolving Loan Exposures had not been repaid, collateralized, or terminated and shall be based upon the Revolving Loan Exposures as they existed immediately prior to their repayment, collateralization, or termination.
“ Projections ” has the meaning specified therefor in Section 5.1(e)  of the Agreement.
“ Property ” means with respect to any Person, any real or personal property, plant, building, facility, structure, equipment or unit, or other asset (tangible or intangible) owned, leased or operated by such Person.
“ Protective Advances ” has the meaning specified therefor in Section 2.3(d)(i)  of the Agreement.
“ Public Lender ” has the meaning specified therefor in Section 17.9(c)  of the Agreement.
“ Receivables Facility ” means the financing arrangement pursuant to the Receivables Facility Credit Agreement.
“ Receivables Facility Administrative Agent ” means Chase, in its capacity as the “Administrative Agent” under and as defined in the Receivables Facility Credit Agreement, and any successor to Chase in that capacity.
“ Receivables Facility Availability ” means, at any time, “Availability” under and as defined in the Receivables Facility Credit Agreement.
“ Receivables Facility Commitment ” means, at any time, the “Aggregate Revolving Commitment” under and as defined in the Receivables Facility Credit Agreement.
 
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“ Receivables Facility Credit Agreement ” means the Credit Agreement dated as of October 5, 2015, among ARC, the other Receivables Facility Loan Parties party thereto, the Receivables Facility Administrative Agent, and the other financial institutions named therein, as the same may be amended or replaced from time to time.
“ Receivables Facility Loan Party ” means each “Loan Party” under and as defined in the Receivables Facility Credit Agreement.
“ Receivables Facility Secured Obligations ” means the “Secured Obligations” under and as defined in the Receivables Facility Credit Agreement.
“ Receivables Facility Transactions ” means any sale, assignment, or other transfer to ARC by Anixter or any Subsidiary of accounts receivable, lease receivables, or other payment obligations owing to Anixter or such Subsidiary or any interest in any of the foregoing, together in each case with any collections and other proceeds thereof, any collection or deposit accounts related thereto, and any collateral, guaranties or other property or claims in favor of Anixter or such Subsidiary supporting or securing payment by the obligor thereon of, or otherwise related to, any such receivables.
“ Receivables Facility Transaction Documents ” means the Receivables Sale Agreement, each Receivables Transfer Agreement, the ARC Subordinated Documents and each of the other material agreements, instruments, and documents executed and delivered in connection with the Receivables Facility Transactions.
“ Receivables Sale Agreement ” means that certain Third Amended and Restated Receivables Sale Agreement, dated as of the date of this Agreement, by and between Anixter, as seller, and ARC, as buyer, as the same may be amended, restated or otherwise modified from time to time.
“ Receivables Transfer Agreement ” means (a) any Subsidiary Originator Transfer Agreement, and (b) any other receivables transfer agreement entered into from time to time by and between Anixter, as the buyer, and any other Originator, as the seller, in each case as the same may be amended, restated or otherwise modified from time to time.
“ Record ” means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
“ Refinance Indebtedness ” has the meaning specified therefor in Section 6.1(a)(xiii)  of the Agreement.
“ Register ” has the meaning set forth in Section 13.1(h)  of the Agreement.
“ Regulation T, U, or X ” means Regulation T, U, or X, respectively, of the Board of Governors as from time to time in effect and any successor to all or a portion thereof.
“ Registered Loan ” has the meaning set forth in Section 13.1(h)  of the Agreement.
“ Related Fund ” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course and that is administered, advised or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers, advises or manages a Lender.
 
Schedule 1.1
28

“ Related Transactions ” means, collectively, (a) the Transactions, (b) the “Transactions” under and as defined in the Receivables Facility Credit Agreement, (c) the HD Supply Acquisition, and (d) the Receivables Facility Transactions.
“ Related Transactions Documents ” means, collectively, (a) the Loan Documents, (b) the Revolving Subordinated Note, (c) the “Loan Documents” under and as defined in the Receivables Facility Credit Agreement, (d) the ARC Subordinated Documents, (e) the Receivables Sale Agreement, (f) the Receivables Transfer Agreements, and (g) all other material agreements, instruments, and documents executed and delivered in connection with the Receivables Facility Transactions.
“ Release ” means any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, disposing, or dumping into the environment.
“ Remedial Action ” means any action required by a Governmental Authority or an Environmental Law to (a) clean up, remove, treat or in any other way address Hazardous Materials; (b) prevent a Release or minimize the further Release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare or the environment; or (c) perform pre-remedial studies and investigations or post-remedial monitoring and care.
“ Replacement Lender ” has the meaning specified therefor in Section 2.13(b)  of the Agreement.
“ Report ” has the meaning specified therefor in Section 15.16 of the Agreement.
“ Reportable Event ” means any of the events set forth in Section 4043 of ERISA (other than an event for which the 30-day notice period is waived).
“ Required Lenders ” means, at any time, Lenders having or holding more than 50% of the aggregate Revolving Loan Exposure of all Lenders; provided , that (i) the Revolving Loan Exposure of any Defaulting Lender shall be disregarded in the determination of the Required Lenders, and (ii) at any time there are 2 or more Lenders, “Required Lenders” must include at least 2 Lenders (who are not Affiliates of one another).
“ Requirement of Law ” means, as to any Person, the Organization Documents or other organizational or governing documents of such Person, and any law, rule or regulation (excluding Environmental Laws), Permit (excluding any Permit issued pursuant to an Environmental Law), or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its Property or to which such Person or any of its property is subject, including the Securities Act, the Securities Exchange Act, and Regulation T, U, or X, and any certificate of occupancy, zoning ordinance, building, or land use, law, rule, regulation, ordinance or Permit or occupational safety or health law, rule or regulation.
“ Reserves ” means, as of any date of determination, those reserves (other than Receivable Reserves, Bank Product Reserves, and Inventory Reserves) that Administrative Agent deems necessary or appropriate, in its Permitted Discretion and subject to Section 2.1(c) of the Agreement, to establish and
 
Schedule 1.1
29

maintain (including reserves with respect to (a) sums that Anixter or its Subsidiaries are required to pay under any Section of the Agreement or any other Loan Document (such as taxes, assessments, insurance premiums, or, in the case of leased assets, rents or other amounts payable under such leases) and has failed to pay, and (b) amounts owing by Anixter or its Subsidiaries to any Person to the extent secured by a Lien on, or trust over, any of the Collateral (other than a Permitted Encumbrance), which Lien or trust, in the Permitted Discretion of Administrative Agent likely would have a priority superior to Administrative Agent’s Liens (such as Liens or trusts in favor of landlords, warehousemen, carriers, mechanics, materialmen, laborers, or suppliers, or Liens or trusts for ad valorem , excise, sales, or other taxes where given priority under applicable law and/or any potential priority Liens or trust claims under any applicable wage lien laws) in and to such item of the Collateral) with respect to the Borrowing Base or the Maximum Revolver Amount.
“ Revolver Commitment ” means, with respect to each Revolving Lender, its Revolver Commitment, and, with respect to all Revolving Lenders, their Revolver Commitments, in each case as such Dollar amounts are set forth beside such Revolving Lender’s name under the applicable heading on Schedule C-1 to the Agreement or in the Assignment and Acceptance pursuant to which such Revolving Lender became a Revolving Lender under the Agreement, as such amounts may be reduced or increased from time to time pursuant to assignments made in accordance with the provisions of Section 13.1 of the Agreement.
“ Revolver Usage ” means, as of any date of determination, the sum of (a) the amount of outstanding Revolving Loans (inclusive of Swing Loans and Protective Advances), plus (b) the amount of the Letter of Credit Usage.
“ Revolving Lender ” means a Lender that has a Revolver Commitment or that has an outstanding Revolving Loan.
“ Revolving Loan Exposure ” means, with respect to any Revolving Lender, as of any date of determination (a) prior to the termination of the Revolver Commitments, the amount of such Lender’s Revolver Commitment, and (b) after the termination of the Revolver Commitments, the aggregate outstanding principal amount of the Revolving Loans of such Lender.
“ Revolving Loans ” has the meaning specified therefor in Section 2.1(a)  of the Agreement.
“ Revolving Subordinated Note ” means the demand promissory note from Anixter to AXE dated October 6, 2000, as the same may be amended, modified or supplemented.
“ Samuel Zell Group ” means Samuel Zell or any of his affiliates (as such term is defined in Rule 12b-2 of the Securities Exchange Act) or associates (as such term is defined in Rule 12b-2 of the Securities Exchange Act), and his heirs and beneficiaries.
“ Sanctioned Country ” means, at any time, a country or territory which is itself the subject or target of any Sanctions (at the time of this Agreement, Cuba, Iran, North Korea, Sudan, and Syria).
“ Sanctioned Person ” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC or the U.S. Department of State or by the United Nations Security Council, the European Union, or any European Union member state, (b) any Person operating, organized or resident in a Sanctioned Country, or (c) any Person owned or controlled by any such Person or Persons described in the foregoing clauses (a) or (b) .
 
Schedule 1.1
30

“ Sanctions ” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state, or Her Majesty’s Treasury of the United Kingdom.
“ S&P ” has the meaning specified therefor in the definition of “Cash Equivalents.”
“ SEC ” means the United States Securities and Exchange Commission and any successor thereto.
“ Secured Debt ” has the meaning assigned to that term in the 2012 Notes Indenture.
“ Secured Debt Indenture Cap Amount ” means, at any time, an amount equal to (a) 10% of Consolidated Tangible Net Assets, minus (b) the aggregate amount of Specified Secured Debt then outstanding (other than the Revolver Usage), minus (c) an amount equal to 5% of the aggregate Revolver Commitments.
“ Secured Debt-to-CTNA Ratio ” means, at any time, the ratio of (a) the sum of (i) the aggregate amount of Specified Secured Debt then outstanding (other than the Revolver Usage), plus (ii) an amount equal to 5% of the aggregate Revolver Commitments, plus (iii) the Revolver Usage, to (b) Consolidated Tangible Net Assets.
“ Securities Act ” means the Securities Act of 1933.
“ Securities Exchange Act ” means the Securities Exchange Act of 1934.
“ Settlement ” has the meaning specified therefor in Section 2.3(e)(i)  of the Agreement.
“ Settlement Date ” has the meaning specified therefor in Section 2.3(e)(i)  of the Agreement.
“ Solvent ” means, when used with respect to any Person, that at the time of determination:
(a) the fair value of its assets (both at fair valuation and at present fair saleable value) is equal to or in excess of the total amount of its liabilities, including contingent liabilities;
(b) it is then able and expected to be able to pay its debts as they mature; and
(c) it has capital sufficient to carry on its business as conducted and as proposed to be conducted.
With respect to contingent liabilities (such as litigation, guarantees and pension plan liabilities), such liabilities shall be computed at the amount which, in light of all the facts and circumstances existing at the time, represent the amount which can reasonably be expected to become an actual or matured liability.
“ Specified Event of Default ” means (a) any Event of Default described in clause (a) , (b) , (d)  (with respect to any failure to observe or perform any covenant, condition, or agreement contained in
 
Schedule 1.1
31

Section 5.3 (with respect to the existence of any Loan Party), 6.1 , 6.2 , 6.3(a) , 6.4 , 6.5 , 6.11 , or 6.14 of the Agreement), (h) , (i) , or (j) of  Section 8 of the Agreement, or (b) any “Specified Amortization Event” under and as defined in the Receivables Facility Credit Agreement.
“ Specified Representations ” means the representations and warranties set forth in Sections 4.1 , 4.2 , 4.3(a) , 4.3(b) , 4.3(c) (with respect to Requirements of Law), 4.8 , 4.13 , 4.16 (as to perfection (insofar as perfection is achieved by the filing of UCC financing statements, intellectual property security agreements, or delivery of Equity Interest certificates and undated Equity Interest powers)), 4.18 , 4.19 , and 4.22 of the Agreement.
“ Specified Secured Debt ” means Secured Debt issued after April 30, 2012, other than Secured Debt permitted to be secured under subparagraphs (a) through (l), inclusive, of Section 1005 of the 2012 Notes Indenture.
“ Standard Letter of Credit Practice ” means, for Issuing Bank, any domestic or foreign law or letter of credit practices applicable in the city in which Issuing Bank issued the applicable Letter of Credit or, for its branch or correspondent, such laws and practices applicable in the city in which it has advised, confirmed or negotiated such Letter of Credit, as the case may be, in each case, (a) which letter of credit practices are of banks that regularly issue letters of credit in the particular city, and (b) which laws or letter of credit practices are required or permitted under ISP or UCP, as chosen in the applicable Letter of Credit.
“ Subordinated Indebtedness ” of a Person means any Indebtedness of such Person the payment of which is subordinated to payment of the Obligations to the written satisfaction of Administrative Agent.
“ Subsidiary ” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless the context requires otherwise, “Subsidiary” means a Subsidiary of Anixter.
“ Subsidiary Originator ” means each “Subsidiary Originator” under and as defined in the Receivables Facility Credit Agreement.
“ Subsidiary Originator Receivable ” means a Receivable originated by a Subsidiary Originator and sold by a Subsidiary Originator to Anixter pursuant to a Subsidiary Originator Transfer Agreement.
“ Subsidiary Originator Transfer Agreement ” means any receivables transfer agreement entered into from time to time by and between Anixter, as the buyer, and any Subsidiary Originator, as the seller, in each case as the same may be amended, restated or otherwise modified from time to time.
“ Supply Chain Finance Arrangement ” means any arrangement entered into by a Borrower or its Subsidiaries with a Bank Product Provider pursuant to which such Bank Product Provider finances open accounts payable of any of such Borrower and its Subsidiaries owing to its vendors, including, without limitation, any such arrangement facilitated through the PrimeRevenue system.
 
Schedule 1.1
32

“ Swap Agreement ” means a “swap agreement” as that term is defined in Section 101(53B)(A) of the Bankruptcy Code.
“ Swap Obligations ” means any and all obligations or liabilities, whether absolute or contingent, due or to become due, now existing or hereafter arising, of Anixter and its Subsidiaries arising under, owing pursuant to, or existing in respect of Swap Agreements entered into with one or more of the Swap Providers.
“ Swap Provider ” means any Lender or any of its Affiliates; provided , that no such Person (other than Wells Fargo or its Affiliates) shall constitute a Swap Provider unless and until Administrative Agent receives a Bank Product Provider Agreement from such Person and with respect to the applicable Swap Agreement within 10 days after the execution and delivery of such Swap Agreement with Anixter or its Subsidiaries; provided further , that if, at any time, a Lender ceases to be a Lender under the Agreement, then, from and after the date on which it ceases to be a Lender thereunder, neither it nor any of its Affiliates shall constitute Swap Providers and the obligations with respect to Swap Agreements entered into with such former Lender or any of its Affiliates shall no longer constitute Swap Obligations.
“ Swing Lender ” means Wells Fargo or any other Lender that, at the request of Borrowers and with the consent of Administrative Agent agrees, in such Lender’s sole discretion, to become the Swing Lender under Section 2.3(b) of the Agreement.
“ Swing Loan ” has the meaning specified therefor in Section 2.3(b)  of the Agreement.
“ Swing Loan Exposure ” means, as of any date of determination with respect to any Lender, such Lender’s Pro Rata Share of the Swing Loans on such date.
“ Synthetic Lease Obligation ” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).
“ Target ” has the meaning specified therefor in the definition of “HD Supply Acquisition.”
“ Taxes ” means any taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed by any jurisdiction or by any political subdivision or taxing authority thereof or therein, and all interest, penalties or similar liabilities with respect thereto.
“ Tax Lender ” has the meaning specified therefor in Section 14.2(a)  of the Agreement.
“ Termination Event ” means a (a) Reportable Event with respect to any Benefit Plan; (b) the withdrawal of Anixter or any ERISA Affiliate from a Benefit Plan during a plan year in which Anixter or such ERISA Affiliate was a “substantial employer” as defined in Section 4001(a)(2) of ERISA; (c) the imposition of an obligation of Anixter or any ERISA Affiliate under Section 4041 of ERISA to provide affected parties written notice of intent to terminate a Benefit Plan in a distress termination described in Section 4041(c) of ERISA; (d) the institution by the PBGC or any similar foreign governmental authority of proceedings to terminate a Benefit Plan or a Foreign Pension Plan, (e) any event or condition which
 
Schedule 1.1
33

might constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Benefit Plan; (f) a foreign governmental authority shall appoint or institute proceedings to appoint a trustee to administer any Foreign Pension Plan; or (g) the partial or complete withdrawal of Anixter of any ERISA Affiliate from a Multiemployer Plan or a Foreign Pension Plan.
“ Transactions ” means the execution, delivery and performance by Anixter, the Subsidiaries of Anixter (as applicable), and the other Loan Parties of this Agreement and the other Loan Documents, the borrowing of Loans and other credit extensions, the use of the proceeds thereof, and the issuance of Letters of Credit hereunder.
“ UCP ” means, with respect to any Letter of Credit, the Uniform Customs and Practice for Documentary Credits 2007 Revision, International Chamber of Commerce Publication No. 600 and any subsequent revision thereof adopted by the International Chamber of Commerce on the date such Letter of Credit is issued.
“ Unfinanced Capital Expenditures ” means, for any period, Capital Expenditures made during such period which are not financed from the proceeds of any Indebtedness (other than the Revolving Loans; it being understood and agreed that, to the extent any Capital Expenditures are financed with Revolving Loans, such Capital Expenditures shall be deemed Unfinanced Capital Expenditures).
“ United States ” means the United States of America.
“ Unused Line Fee ” has the meaning specified therefor in Section 2.10(b)  of the Agreement.
“ Voidable Transfer ” has the meaning specified therefor in Section 17.8 of the Agreement.
“ Wells Fargo ” means Wells Fargo Bank, National Association, a national banking association.
 
Schedule 1.1
34

Exhibit 10.4
THE BANK OF NOVA SCOTIA,
as Administrative Agent
- and -
THE BANK OF NOVA SCOTIA and
BANK OF AMERICA, N.A., CANADA BRANCH,
as Co-Lead Arrangers and Joint Bookrunners
- and -
BANK OF AMERICA, N.A., CANADA BRANCH
as Syndication Agent
- and -
THE BANK OF NOVA SCOTIA and
BANK OF AMERICA, N.A., CANADA BRANCH,
as Lenders
- and -
ANIXTER CANADA INC. and TRI-ED ULC
as Borrowers
- and -
ANIXTER MID HOLDINGS B.V.,
as Guarantor

CREDIT AGREEMENT

OCTOBER 5, 2015

Fasken Martineau DuMoulin LLP
333 Bay Street
Suite 2400, Bay-Adelaide Centre
Toronto, Ontario M5H 2T6

TABLE OF CONTENTS

 	  	 	  	Page 	 	
ARTICLE 1 INTERPRETATION	  	 	2	  	
			
1.1	  	Defined Terms.	  	 	2	  	
1.2	  	Other Usages.	  	 	33	  	
1.3	  	Plural and Singular.	  	 	33	  	
1.4	  	Headings.	  	 	33	  	
1.5	  	Currency.	  	 	33	  	
1.6	  	Applicable Law.	  	 	33	  	
1.7	  	Time of the Essence.	  	 	33	  	
1.8	  	Non-Banking Days.	  	 	33	  	
1.9	  	Consents and Approvals.	  	 	34	  	
1.10	  	Amount of Credit.	  	 	34	  	
1.11	  	Schedules.	  	 	34	  	
1.12	  	Paramountcy.	  	 	34	  	
1.13	  	Extension of Credit.	  	 	34	  	
1.14	  	Documents in English.	  	 	35	  	
1.15	  	Statute References.	  	 	35	  	
1.16	  	Calculations, Computations.	  	 	35	  	
1.17	  	Successors and Permitted Assigns of Parties.	  	 	35	  	
1.18	  	Meaning of Include.	  	 	35	  	
1.19	  	Rule of Construction.	  	 	35	  	
1.20	  	Relevant Lenders.	  	 	36	  	
1.21	  	Change in Accounting Policies.	  	 	36	  	
1.22	  	Joint and Several Obligations.	  	 	36	  	
1.23	  	Dutch Terms	  	 	37	  	
		
ARTICLE 2 CREDIT FACILITIES	  	 	37	  	
			
2.1	  	Establishment of Credit Facilities.	  	 	37	  	
2.2	  	Credit Restrictions.	  	 	38	  	
2.3	  	Lenders’ Commitments.	  	 	38	  	
2.4	  	Reduction of Credit Limits.	  	 	38	  	
2.5	  	Termination of Credit Facilities.	  	 	39	  	
		
ARTICLE 3 GENERAL PROVISIONS RELATING TO CREDITS	  	 	39	  	
			
3.1	  	Types of Credit Availments.	  	 	39	  	
3.2	  	Funding of Loans.	  	 	40	  	
3.3	  	Failure of Lender to Fund Loan.	  	 	40	  	
3.4	  	Funding of Bankers’ Acceptances.	  	 	41	  	
3.5	  	BA Equivalent Loans.	  	 	44	  	
3.6	  	Inability to Fund U.S. Dollar Advances in Canada.	  	 	44	  	
3.7	  	Timing of Credit Availments.	  	 	46	  	
3.8	  	Time, Place and Source of Payments.	  	 	46	  	
3.9	  	Remittance of Payments.	  	 	46	  	

TABLE OF CONTENTS
(continued)

3.10	  	Evidence of Indebtedness.	  	 	47	  	
3.11	  	General Provisions Relating to Letters.	  	 	47	  	
3.12	  	Notice Periods.	  	 	49	  	
3.13	  	Swingline Advances.	  	 	50	  	
3.14	  	Administrative Agent’s Discretion to Allocate.	  	 	51	  	
		
ARTICLE 4 DRAWDOWNS	  	 	52	  	
			
4.1	  	Drawdown Notice.	  	 	52	  	
4.2	  	Drawdown Restriction.	  	 	52	  	
		
ARTICLE 5 ROLLOVERS	  	 	52	  	
			
5.1	  	Bankers’ Acceptances.	  	 	52	  	
5.2	  	LIBOR Loans and BA Equivalent Loans.	  	 	52	  	
5.3	  	Rollover Notice.	  	 	53	  	
		
ARTICLE 6 CONVERSIONS	  	 	53	  	
			
6.1	  	Converting Loan to Other Type of Loan.	  	 	53	  	
6.2	  	Converting Loan to Bankers’ Acceptances.	  	 	53	  	
6.3	  	Converting Bankers’ Acceptances to Loan.	  	 	53	  	
6.4	  	Conversion Notice.	  	 	54	  	
6.5	  	Absence of Notice.	  	 	54	  	
6.6	  	Conversion After Default.	  	 	54	  	
		
ARTICLE 7 INTEREST AND FEES	  	 	54	  	
			
7.1	  	Interest Rates.	  	 	54	  	
7.2	  	Interest In Advance.	  	 	55	  	
7.3	  	Calculation and Payment of Interest.	  	 	55	  	
7.4	  	General Interest Rules.	  	 	55	  	
7.5	  	Selection of Interest Periods.	  	 	56	  	
7.6	  	Acceptance Fees.	  	 	56	  	
7.7	  	Standby Fee.	  	 	57	  	
7.8	  	Letter Fees.	  	 	57	  	
7.9	  	Interest and Fee Adjustment.	  	 	57	  	
		
ARTICLE 8 RESERVE, CAPITAL, INDEMNITY AND TAX PROVISIONS	  	 	58	  	
			
8.1	  	Increased Costs.	  	 	58	  	
8.2	  	Failure to Fund as a Result of Change of Circumstances.	  	 	59	  	
8.3	  	Indemnity Relating to Credits.	  	 	60	  	
8.4	  	Indemnity for Transactional and Environmental Liability.	  	 	61	  	
8.5	  	Payments Free and Clear of Taxes.	  	 	62	  	
		
ARTICLE 9 REPAYMENTS AND PREPAYMENTS	  	 	64	  	
			
9.1	  	Repayment of Credit Facilities.	  	 	64	  	

TABLE OF CONTENTS
(continued)

9.2	  	Voluntary Prepayments.	  	 	65	  	
9.3	  	Mandatory Prepayments under the NRT Facility.	  	 	65	  	
9.4	  	Prepayment Notice.	  	 	66	  	
9.5	  	Reimbursement Obligation for Maturing Bankers’ Acceptances.	  	 	66	  	
9.6	  	Reimbursement or Conversion on Presentation of Letters.	  	 	67	  	
9.7	  	Letters Subject to an Order.	  	 	68	  	
9.8	  	Repayment of Credit Excess.	  	 	68	  	
9.9	  	Currency of Repayment.	  	 	68	  	
		
ARTICLE 10 REPRESENTATIONS AND WARRANTIES	  	 	68	  	
			
10.1	  	Representations and Warranties.	  	 	68	  	
10.2	  	Survival of Representations and Warranties.	  	 	77	  	
		
ARTICLE 11 COVENANTS	  	 	78	  	
			
11.1	  	Affirmative Covenants.	  	 	78	  	
11.2	  	Performance of Covenants by Administrative Agent.	  	 	88	  	
11.3	  	Restrictive Covenants.	  	 	88	  	
11.4	  	Deposit Arrangements and Subordinate Debt Documents.	  	 	91	  	
		
ARTICLE 12 CONDITIONS PRECEDENT TO OBTAINING CREDIT	  	 	92	  	
			
12.1	  	Conditions Precedent to All Credit.	  	 	92	  	
12.2	  	Conditions Precedent to Effectiveness of Agreement.	  	 	92	  	
12.3	  	Waiver.	  	 	96	  	
12.4	  	Existing Letters of Credit.	  	 	96	  	
		
ARTICLE 13 DEFAULT AND REMEDIES	  	 	96	  	
			
13.1	  	Events of Default.	  	 	96	  	
13.2	  	Refund of Overpayments.	  	 	100	  	
13.3	  	Remedies Cumulative.	  	 	100	  	
13.4	  	Set-Off.	  	 	101	  	
		
ARTICLE 14 THE ADMINISTRATIVE AGENT	  	 	101	  	
			
14.1	  	Appointment and Authorization of Administrative Agent.	  	 	101	  	
14.2	  	Interest Holders.	  	 	102	  	
14.3	  	Consultation with Counsel.	  	 	102	  	
14.4	  	Documents.	  	 	102	  	
14.5	  	Administrative Agent as Finance Party.	  	 	102	  	
14.6	  	Responsibility of Administrative Agent.	  	 	103	  	
14.7	  	Action by Administrative Agent.	  	 	103	  	
14.8	  	Notice of Events of Default.	  	 	103	  	
14.9	  	Responsibility Disclaimed.	  	 	104	  	
14.10	  	Indemnification.	  	 	104	  	
14.11	  	Credit Decision.	  	 	104	  	

TABLE OF CONTENTS
(continued)

14.12	  	Successor Administrative Agent.	  	 	105	  	
14.13	  	Delegation by Administrative Agent.	  	 	106	  	
14.14	  	Waivers and Amendments.	  	 	106	  	
14.15	  	Determination by Administrative Agent Conclusive and Binding.	  	 	107	  	
14.16	  	Adjustments among Lenders after Acceleration.	  	 	108	  	
14.17	  	Redistribution of Payment.	  	 	108	  	
14.18	  	Distribution of Notices.	  	 	109	  	
14.19	  	Determination of Exposures.	  	 	109	  	
14.20	  	Decision to Enforce Security.	  	 	110	  	
14.21	  	Enforcement.	  	 	110	  	
14.22	  	Application of Cash Proceeds of Realization.	  	 	110	  	
14.23	  	Security Documents.	  	 	111	  	
14.24	  	Entering into Contracts.	  	 	111	  	
14.25	  	Discharge of Security.	  	 	111	  	
14.26	  	Survivorship.	  	 	112	  	
		
ARTICLE 15 GUARANTEE	  	 	112	  	
			
15.1	  	Guarantee.	  	 	112	  	
15.2	  	Nature of Guarantee.	  	 	112	  	
15.3	  	Credit Parties not Bound to Exhaust Recourse.	  	 	113	  	
15.4	  	Evidence of Finance Obligations.	  	 	114	  	
15.5	  	Guarantee in Addition to Other Security.	  	 	114	  	
15.6	  	Reinstatement.	  	 	114	  	
15.7	  	Waiver of Notice, Etc.	  	 	114	  	
15.8	  	Subrogation Rights, Assignment and Postponement of Claim.	  	 	114	  	
15.9	  	Advance After Certain Events.	  	 	115	  	
15.10	  	Parallel Debt (Covenant to pay the Administrative Agent).	  	 	115	  	
		
ARTICLE 16 MISCELLANEOUS	  	 	116	  	
			
16.1	  	Waivers.	  	 	116	  	
16.2	  	Notices.	  	 	116	  	
16.3	  	Severability.	  	 	116	  	
16.4	  	Counterparts.	  	 	116	  	
16.5	  	Successors and Assigns; No Third Party Rights or Liabilities.	  	 	116	  	
16.6	  	Assignment.	  	 	117	  	
16.7	  	Entire Agreement.	  	 	118	  	
16.8	  	Judgment Currency.	  	 	118	  	
16.9	  	Forum Selection and Consent to Jurisdiction.	  	 	119	  	
16.10	  	Confidentiality.	  	 	120	  	
16.11	  	USA PATRIOT Act Notice.	  	 	120	  	
16.12	  	Anti-Money Laundering Legislation.	  	 	120	  	
16.13	  	Waivers of Jury Trial.	  	 	121	  	
16.14	  	Further Assurances.	  	 	121	  	

TABLE OF CONTENTS
(continued)

SCHEDULE A INDIVIDUAL COMMITMENTS	  	 	N-1	  	
		
SCHEDULE B COMPLIANCE CERTIFICATE	  				
		
SCHEDULE C FORM OF ASSIGNMENT	  				
		
SCHEDULE D FORM OF DRAWDOWN NOTICE	  				
		
SCHEDULE E FORM OF ROLLOVER NOTICE	  				
		
SCHEDULE F FORM OF CONVERSION NOTICE	  				
		
SCHEDULE G -1 CORPORATE STRUCTURE -(PRE- HDS ACQUISITION)	  				
		
SCHEDULE G-2 CORPORATE STRUCTURE (POST- HDS ACQUISITION)	  				
		
SCHEDULE H GUARANTEE AND SECURITY DOCUMENTS	  				
		
SCHEDULE I QUALIFIED AFFILIATE INSTRUMENT OF ADHESION	  				
		
SCHEDULE J PRIMARY OBLIGOR INSTRUMENT OF ADHESION	  				
		
SCHEDULE K BORROWER INSTRUMENT OF ADHESION	  				
		
SCHEDULE L CAPITAL OF PLEDGED COMPANIES	  				
		
SCHEDULE M APPLICABLE MARGIN	  				
		
SCHEDULE N LETTERS OF CREDIT UNDER EXISTING CREDIT AGREEMENT	  				

THIS CREDIT AGREEMENT made as of the 5 th day of October, 2015.
B E T W E E N:
THE BANK OF NOVA SCOTIA , a Canadian chartered bank
(herein, in its capacity as administrative agent of the Lenders, called the “ Administrative Agent ”)
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THE BANK OF NOVA SCOTIA and BANK OF AMERICA, N.A., CANADA BRANCH , and one or more Persons to whom the foregoing or its permitted assigns may from time to time assign an undivided interest in the Loan Documents (as defined herein) and who agree to be bound by the terms hereof as a Lender (as defined herein)
(herein, in their capacities as lenders to the Borrowers, collectively called the “ Lenders ” and individually called a “ Lender ”)
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ANIXTER CANADA INC. , a corporation incorporated under the laws of Canada, as a borrower
(herein called “ Anixter Canada ”)
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TRI-ED ULC , an unlimited liability company organized under the laws of the Province of British Columbia, as a borrower
(herein called “ Tri-Ed ”)
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ANIXTER MID HOLDINGS BV , a company formed under the laws of the Netherlands, as a guarantor
(herein called “ Anixter Mid Holdings ”)
WHEREAS Anixter Canada has requested the Lenders to provide it with a certain non-revolving term credit facility and the Borrowers have requested that the Lenders provide it with a certain revolving term credit facility, in each case for the purposes set forth in Section 11.1(e) of this agreement;

AND WHEREAS such Lenders are each willing to provide such credit facilities to the relevant Borrowers for the aforementioned purposes upon the terms and conditions contained herein;
NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the mutual covenants and agreements herein contained and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto covenant and agree as follows:
ARTICLE 1
INTERPRETATION
 
1.1	Defined Terms.	
The following defined terms shall for all purposes of this agreement, or any amendment, substitute, supplement, replacement or addition hereto, have the following respective meanings unless the context otherwise specifies or requires or unless otherwise defined herein:
“ Acquisition ” means:
 
 	(a)	if the acquisition is a share purchase, Anixter Canada shall Control the entity being acquired immediately following the completion of such acquisition; or	
 
 	(b)	if the acquisition is an asset purchase, all or substantially all of the assets of the vendor (or of a division or unit of the vendor) are being acquired.	
“ Additional Guarantor ” means any Person which becomes a Guarantor pursuant to Section 11.1(s).
“ Adjusted Consolidated Basis ” means, in respect of any calculation, computation, results of operations, financial position or similar analysis or results during any fiscal period of Anixter Canada from and including January 1, 2015, the results of such calculations, computations, results of operations, financial position or similar analysis or results of Anixter Canada on a consolidated basis in accordance with GAAP but excluding the results of such calculations, computations, results of operations, financial position or similar analysis or results of any directly or indirectly owned Subsidiary incorporated or formed outside of Canada or any province or territory thereof.
“ A ffiliate ” shall have the meaning ascribed thereto in the Canada Business Corporations Act .
“ Agency Fee Letter ” means the agency fee letter dated July 31, 2015 between Anixter Canada and The Bank of Nova Scotia, as the same may be amended, modified, supplemented or replaced from time to time.
 
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“ Alternate Base Rate Canada ” means, at any particular time, the greater of (a) the Base Rate Canada at such time and (b) the Federal Funds Effective Rate at such time plus  1 ⁄ 2 of 1% per annum.
“ AML/CTF Laws ” means the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and any other anti-money laundering or counter-terrorism financing laws or regulations including without limitation, any laws or regulations imposing “know your customer” or other identification checks or procedures, that apply to a Credit Party, in any jurisdiction in connection with the Loan Documents.
“ Applicable Law ” means all public laws, statutes, ordinances, decrees, judgments, codes, standards, acts, orders, by-laws, rules, regulations, Official Body Consents, permits and requirements of all Official Bodies, in each case having the force of law and which now or hereafter may be lawfully applicable to and enforceable against any Company or its property or any part thereof.
“ Applicable Margin ” means, at any particular time, the applicable margin or fee rate, as the case may be, expressed as basis points per annum which are in effect at such time based upon the Total Leverage Ratio for the Fiscal Quarter that is the subject of the compliance certificate delivered by the Borrowers to the Administrative Agent at the time this agreement becomes effective or otherwise most recently delivered by the Borrowers to the Administrative Agent pursuant to Section 11.1(b)(iii), as set forth in the tables at Schedule M hereto; provided that (i) changes in the Applicable Margin shall be effective as set forth in Section 7.9 and (ii) changes in the Applicable Margin shall apply, as at the effective dates of such changes, to Loans and Letters outstanding on such dates, but only for those portions of applicable terms falling within those times during which the changes in the Applicable Margin are effective, as provided above. For the period from the date hereof until the Reporting Date with respect to the first full Fiscal Quarter after the Closing Date, the Applicable Margin shall be established pursuant to the compliance certificate delivered pursuant to Section 12.2(h)(viii) but in no event shall be less than Level 4.
“ Asset Sale Prepayment Trigger Event ” means the receipt by any Secured Obligor of any cash proceeds in an amount equal to or greater than $2,000,000 or the Exchange Equivalent thereof, from any sale of assets made in reliance in Section 11.3(m)(v) where such proceeds, or any portion thereof, have not been committed or reinvested by the relevant Secured Obligor within 365 days of the relevant asset sale.
“ Available RT Credit ” means, at any particular time, the amount, if any, by which the RT Credit Limit at such time exceeds the amount of credit outstanding under the RT Facility in favour of the Borrowers at such time.
 
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“ BA Discounted Proceeds ” means, in respect of any Bankers’ Acceptances to be accepted by a Lender on any day, an amount (rounded to the nearest whole cent and with one-half of one cent being rounded up) calculated on such day by multiplying:
 
 	(a)	the aggregate face amount of such Bankers’ Acceptances; by	
the amount equal to one divided by the sum of one plus the product of:
 
 	(a)	the BA Rate which is applicable to such Bankers’ Acceptance (expressed as a decimal); and	
 
 	(b)	a fraction, the numerator of which is the number of days in the term of such Bankers’ Acceptances and the denominator of which is 365;	
with the amount as so determined being rounded up or down to the fifth decimal place and .000005 being rounded up.
“ BA Equivalent Loan ” shall have the meaning ascribed thereto in Section 3.5.
“ BA Non-Schedule I Rate ” means, with respect to an issue of Bankers’ Acceptances with the same maturity date to be accepted by a Non-Schedule I Lender hereunder, the lesser of (i) the discount rate per annum, calculated on the basis of a year of 365 days, determined by the Administrative Agent as being the arithmetic average (rounded upwards to the nearest multiple of 0.01%) of the discount rates of the Non-Schedule I Lenders determined in accordance with their normal practices at or about 10:00 a.m. (Toronto time) on the date of issue and acceptance of such Bankers’ Acceptances, for bankers’ acceptances having a comparable face value and maturity date to the face value and the maturity date of such issue of Bankers’ Acceptances and (ii) the BA Schedule I Rate with respect to an issue of Bankers’ Acceptances with the same maturity date to be accepted by a Schedule I Lender hereunder on the same date plus 0.10% per annum.
“ BA Proceeds ” means, with respect to a particular Bankers’ Acceptance, the BA Discounted Proceeds with respect thereto less the amount of the acceptance fees in respect of such Bankers’ Acceptance calculated in accordance with Section 7.6.
“ BA Rate ” means the BA Schedule I Rate or the BA Non-Schedule I Rate, as the case may be.
“ BA Schedule I Rate ” means, with respect to an issue of Bankers’ Acceptances with the same maturity date to be accepted by a Schedule I Lender hereunder, the discount rate per annum, calculated on the basis of a year of 365 days, (i) equal to, as determined by the Administrative Agent, the arithmetic average (rounded upwards to the nearest multiple of 0.01%) of the discount rates of the Schedule I Lenders that appear on the Reuters Screen CDOR Page (or any page substituted therefor) for the Schedule I Lenders at or about 10:00 a.m. (Toronto time) on the date of issue and acceptance of such Bankers’ Acceptances, for bankers’
 
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acceptances having a comparable face value and maturity date to the face value and maturity date of such issue of Bankers’ Acceptances or (ii) if such Page or any substitute therefor is not available, equal to, as determined by the Administrative Agent, the arithmetic average (rounded upwards to the nearest multiple of 0.01%) of the discount rates of the Schedule I Lenders determined in accordance with their normal practices at or about 10:00 a.m. (Toronto time) on the date of acceptance of such Bankers’ Acceptances, for bankers’ acceptances having a comparable face value and maturity date to the face value and maturity date of such issue of Bankers’ Acceptances.
“ Bankers’ Acceptance ” means a bill of exchange under the Bills of Exchange Act (Canada) or a depository bill under the Depository Bills and Notes Act (Canada) (a) drawn by a Borrower and accepted by a Lender, (b) denominated in dollars, (c) having a term of 30 to 180 days, as selected by such Borrower, (d) issued and payable only in Canada and (e) having a face amount of an integral multiple of $1,000.
“ Banking Day ” means any day, other than Saturday and Sunday, on which banks generally are open for business in Toronto, Ontario and Chicago, Illinois and, when used in respect of LIBOR Loans, means any day other than a Saturday or a Sunday on which banks generally are open for business in Toronto, Ontario, Chicago, Illinois and London, England and on which transactions can be carried on in the London interbank market.
“ Base Rate Canada ” means the variable rate of interest per annum equal to the rate of interest determined by the Administrative Agent from time to time as its base rate for United States dollar loans made by the Administrative Agent to commercial borrowers in Canada from time to time, being a variable per annum reference rate of interest adjusted automatically upon change by the Administrative Agent, calculated on the basis of a year of 365 days or 366 days in the case of a leap year.
“ Base Rate Canada Loan ” means monies lent by the Lenders to the Borrowers in United States dollars and upon which interest accrues at a rate referable to the Alternate Base Rate Canada.
“ Borrowers ” means Anixter Canada, Tri-Ed and any other Subsidiary of Anixter Canada which has complied with Section 11.1(t) and “ Borrower ” means any one of the Borrowers.
“ BMG Account ” means Anixter’s Canada’s deposit account maintained with Bank Mendes Gans N.V. for the purpose of the deposit arrangements referenced at Section 11.4.
“ Borrowing Group ” means, at any particular time, Anixter Canada, and each of its direct and indirectly owned Subsidiaries which are incorporated under the laws of Canada or any province or territory thereof at such time.
 
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“ Borrowing Group EBITDA ” means the Net Income, in accordance with generally accepted accounting principles for the most recently completed four consecutive Fiscal Quarters plus, to the extent deducted in the calculation of Net Income:
 
 	(a)	the provision for depreciation and amortization expense of the Borrowing Group for such period;	
 
 	(b)	income taxes of the Borrowing Group for such period; and	
 
 	(c)	net Interest Charges for such period;	
Provided that, to the extent included in the calculation of Net Income, there shall be excluded from Borrowing Group EBITDA any non-cash, non-operating gains or losses (including, without limitation, extraordinary or unusual charges or gains or losses, gains or losses arising from the sale of capital assets or the sale of owned buildings and properties and other non-recurring gains or losses) during such period and further provided that, the Borrowing Group EBITDA for periods up to and including the four consecutive completed Fiscal Quarters ending on or about September 30, 2016 shall be calculated on a pro forma basis as if both the Target and Tri-Ed had been operating as part of the Borrowing Group for all of those four consecutive completed Fiscal Quarters, and that the results of the fasteners business divested prior to the HDS Acquisition are excluded for all of those four completed Fiscal Quarters.
“ Branch of Account ” means the Wholesale Banking Operations of the Administrative Agent located at 720 King Street West, Toronto, Ontario, or such other branch of the Administrative Agent located in Canada as the Borrowers and the Administrative Agent may agree upon.
“ Canadian Dollar Equivalent ” means the Exchange Equivalent in Canadian dollars of any amount of United States dollars.
“ Capital Expenditures ” means, for any particular period, the aggregate amount (expressed in Canadian dollars) of those expenditures of Anixter Canada which would, in accordance with generally accepted accounting principles and on an Adjusted Consolidated Basis, be considered expenditures for capital assets of Anixter Canada for such period, all as determined in accordance with Section 1.16.
“ Capital Market Agreements ” means each present or future agreement which evidences any commodity hedging transaction, spot or forward foreign exchange transaction, interest rate swap transaction, currency swap transaction, forward rate transaction, rate cap transaction, rate floor transaction, rate collar transaction, and any other exchange or rate protection transaction, any combination of such transactions or any option with respect to any such transaction.
 
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“ Capital Market Obligations ” of a particular Obligor means all indebtedness, obligations and liabilities, present or future, absolute or contingent, matured or not, at any time owing by such Obligor to the Qualified Capital Market Lenders or any of them, or remaining unpaid to the Qualified Capital Market Lenders or any of them, under or in connection with all Secured Capital Market Agreements to which such Obligor is a party; provided, however, that “Capital Market Obligations” of a particular Obligor shall exclude any Excluded Obligations with respect to such Obligor.
“ Cash ” means, with respect to any Person at any particular time, cash and Cash Equivalents of such Person at such time.
“ Cash Equivalents ” means, as to any Person, (i) securities issued or directly and fully guaranteed or insured by the government of the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) or by the government of Canada or any province thereof, in each case, having maturities of not more than one year from the date of acquisition, (ii) time deposits, certificates of deposit, money market deposits of, and bankers’ acceptances and commercial papers issued by, any commercial bank incorporated in the United States of recognized standing having capital and surplus in excess of U.S. $50,000,000 or of any Canadian chartered bank, in each case, with maturities of not more than one year from the date of acquisition by such Person, and (iii) investments in money market funds substantially all of whose assets are comprised of securities or instruments of the types described in clauses (i) and (ii) above.
“ Cash Management Agreement ” means any agreement to provide cash management services, including treasury, depository, overdraft, credit or debit card, electronic funds transfer, automated clearing house, and other cash management arrangements between any Obligor, on the one hand, and any one of the Qualified Cash Management Lenders (for so long as the relevant financial institution remains a Qualified Cash Management Lender hereunder), on the other.
“ Change in Law ” means the occurrence, after the date of this agreement, of any of the following: (a) the phase-in, adoption or taking effect of any Applicable Law, (b) any change in any Applicable Law or in the administration, interpretation or application thereof by any Official Body or (c) the making or issuance of any Applicable Law by any Official Body or the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Official Body provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.
 
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“ Closing Date ” means the date on which the last condition precedent set forth in Section 12.2 of this agreement has been satisfied or otherwise waived by the Lenders.
“ Code ” means the Internal Revenue Code of 1986 of the United States, as amended from time to time, and any successor statute.
“ Commodity Exchange Act ” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.
“ Companies ” means, collectively, Anixter Canada and all direct and indirectly owned Subsidiaries of Anixter Canada and “ Company ” means any of the Companies.
“ Control ” means, with respect to control of a body corporate by a Person, the holding (other than by way of security only) by or for the benefit of that Person, or affiliates of that Person of securities of such body corporate or the right to vote or direct the voting of securities of such body corporate to which, in the aggregate, are attached more than 50% of the votes that may be cast to elect directors of the body corporate, provided that the votes attached to those securities are sufficient, if exercised, to elect a majority of the directors of the body corporate, and “ Controlled ” shall have a similar meaning.
“ Conversion Notice ” shall have the meaning ascribed thereto in Section 6.4.
“ Credit Facilities ” means the RT Facility and the NRT Facility and “ Credit Facility ” means either of the Credit Facilities.
“ Credit Excess ” means, as at a particular date, the amount, if any, by which the amount of credit outstanding under a particular Credit Facility as at the close of business on such date exceeds the corresponding Credit Limit as at the close of business on such date.
“ Credit Limit ” means the RT Credit Limit or the NRT Credit Limit, as applicable.
“ Credit Parties ” means the Administrative Agent, the Issuing Lender, the Swingline Lender and each Lender.
“ Default ” means any event which is or which, with the passage of time, the giving of notice or both, would be an Event of Default.
“ Defaulting Lender ” means any relevant Lender that (a) has failed to fund any portion of any extension of credit required to be funded by it hereunder within two Banking Days of the date required to be funded by it hereunder unless such
 
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failure has been cured or unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, (b) has otherwise failed to pay over to the Administrative Agent or any other relevant Lender any other amount required to be paid by it hereunder within three Banking Days of the date when due, unless the subject of a good faith dispute or unless such failure has been cured, (c) has notified the Administrative Agent that such Lender does not intend to fund its commitments hereunder (unless such notice relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such notice) cannot be satisfied),, (d) has been determined by a court of competent jurisdiction or regulator to be insolvent or is unable to meet its obligations or admits in writing it is unable to pay its debts as they generally become due, (e) is the subject of a bankruptcy or insolvency proceeding or (f) is subject to or is seeking the appointment of an administrator, regulator, conservator, liquidator, receiver, trustee, custodian or other similar official over any portion of its assets or business.
“ Designated Account ” means, with respect to transactions in a particular currency for a particular Borrower, the account of such Borrower maintained by the Administrative Agent at the Branch of Account for the purposes of transactions in such currency under this agreement.
“ Distribution ” means:
 
 	(a)	the declaration, payment or setting aside for payment of any dividend or other distribution on or in respect of any shares in the capital of a Secured Obligor, other than a dividend declared, paid or set aside for payment by a Secured Obligor which is payable in Shares;	
 
 	(b)	the redemption, retraction, purchase, retirement or other acquisition, in whole or in part, of any shares in the capital of a Secured Obligor or any securities, instruments or contractual rights capable of being converted into, exchanged or exercised for shares in the capital of a Secured Obligor, including, without limitation, options, warrants, conversion or exchange privileges and similar rights; and	
 
 	(c)	the payment of interest or the repayment of principal with respect to any Indebtedness which is subordinated and/or postponed to the Obligations.	
“ Draft ” means any draft, bill of exchange, receipt, acceptance, demand or other request for payment drawn or issued under or in respect of a Letter.
“ Drawdown Notice ” shall have the meaning ascribed thereto in Section 4.1.
 
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“ Environmental Laws ” means all national, international, foreign, federal, state provincial or local statutes, laws, ordinances, codes, rules, regulations, guidelines, consent decrees and administrative orders applicable to any facilities or property operated or used by any Obligor having the force of law and relating to: (i) public health, (ii) the protection of the environment, or (iii) any hazardous or toxic waste, substance or material.
“ EPA ” means the Environmental Protection Act (Ontario), as amended from time to time, and any successor statute.
“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.
“ ERISA Affiliate ” means any trade or business (whether or not incorporated) that is treated as a single employer under section 414 of the Code, and the rules and regulations promulgated thereunder from time to time in effect.
“ ERISA Companies ” means the Obligors and the ERISA Affiliates and “ ERISA Company ” means any of the ERISA Companies.
“ Event of Default ” means any one of the events set forth in Section 13.1.
“ Excess Cash Flow ” means, for any Fiscal Year, the aggregate of Borrowing Group EBITDA for such Fiscal Year plus the proceeds of all asset sales by any member of the Borrower Group during such Fiscal Year which were not prohibited by Section 11.3(m) (to the extent such proceeds were not used to prepay the NRT Facility pursuant to Section 9.3(a)) less the following amounts (without duplication): (i) income and capital tax of Anixter Canada on an Adjusted Consolidated Basis paid in cash during such Fiscal Year; (ii) unfunded Capital Expenditures for such Fiscal Year; (iii) Interest Charges paid during such Fiscal Year; (iv) scheduled principal payments in respect of Indebtedness for borrowed money and the principal portion of scheduled Financing Lease payments and Purchase Money Obligation payments paid by the Borrowing Group during such Fiscal Year; (v) any voluntary and mandatory prepayments made pursuant to this agreement in such Fiscal Year; (vi) cash payments made by the Borrowing Group on account of Acquisitions and Investments not otherwise prohibited by this agreement; and (vii) the amount of the fees and expenses incurred by the Borrowers in connection with the Loan Documents and the Purchase Agreement.
“ Exchange Equivalent ” means, as of any particular date, with reference to any amount (the “ original amount ”) expressed in a particular currency (the “ original currency ”), the amount of the other currency into which the original amount of the original currency may be converted using the mid-rate quoted by the Administrative Agent (that is, the average of the Administrative Agent’s spot buying and selling rates) for such date. For the purpose of calculating any
 
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standby fee, or if the Exchange Equivalent is being determined at any time in respect of a previous day, the noon spot rate of the Bank of Canada on that day shall be used instead of the Administrative Agent’s mid-rate.
“ Excluded Obligation ” means, with respect to a particular Obligor, any Capital Market Obligation of such Obligor and such Obligor’s obligation under all or a portion of a Guarantee of any Capital Market Obligation is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Obligor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the Guarantee becomes effective with respect to such related Capital Market Obligation and each time the related Capital Market Obligation is amended or modified. If a Capital Market Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Capital Market Obligation that is attributable to swaps for which the relevant Guarantee is or becomes illegal.
“ Excluded Taxes ” means, with respect to each Credit Party or any other recipient of any payment to be made by or on account of any obligation of the Borrowers under any Loan Document, (a) Taxes imposed on or measured by its net income (however denominated), franchise Taxes imposed on it (in lieu of net income taxes) and capital Taxes imposed on it, in each case by any jurisdiction (or any political subdivision thereof) as a result of a present or former connection between the relevant Credit Party and the jurisdiction imposing such tax (other than any such connection arising solely from a Credit Party having executed, delivered, become party to, or performed its obligations, or perfected a security interest under, or received a payment under, or engaged in any transaction in respect of, or enforced, any Loan Document), and (b) any branch profits Taxes or any similar Tax imposed by any jurisdiction as a result of a connection described in clause (a) above, (c) withholding Taxes imposed by Part XIII of the Income Tax Act (Canada) on amounts payable by the Borrower to a Credit Party at the time such Credit Party becomes a party to this Agreement (other than pursuant to an assignment at such time that a Default has occurred and is continuing), except to the extent that, pursuant to Section 8.5, additional amounts with respect to such Taxes were payable to such Credit Party’s assignor immediately before such Credit Party became a party hereto, (d) withholding Taxes payable under Part XIII of the Income Tax Act (Canada) that are imposed on amounts payable to or for the account of a Credit Party as a consequence of the Credit Party not dealing at arm’s length (within the meaning of the Income Tax Act (Canada)) with the Borrower at the time of such payment, (e) withholding Taxes payable under Part XIII of the Income Tax Act (Canada) that are imposed on amounts payable to or for the account of a Credit Party as a consequence of the Credit Party being a “specified non-resident shareholder” (within the meaning of subsection 18(5) of the Income Tax Act (Canada)) of the Borrower, or not dealing at arm’s length
 
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(within the meaning of the Income Tax Act (Canada)) with a “specified shareholder” (within the meaning of subsection 18(5) of the Income Tax Act (Canada)) of the Borrower, and (f) U.S. withholding Taxes imposed under FATCA.
“ Existing Credit Agreement ” means the credit agreement dated as of November 18, 2005 entered into among Anixter Canada Inc., as borrower, Anixter Inc., Anixter International Inc., Anixter-Real Estate Inc., Anixter Information Systems Corporation, Anixter Financial Inc., Anixter Procurement Corporation and WireXpress Ltd., as guarantors and The Bank of Nova Scotia, as administrative agent and lender.
“ Existing Letters of Credit ” means those letters of credit referenced in Schedule N hereto which were issued pursuant to the Existing Credit Agreement.
“ Exposure ” means, with respect to a particular Finance Party at a particular time, the amount of the Finance Obligations owing to such Finance Party at such time, determined by such Finance Party in good faith in accordance with Section 14.19.
“ F.R.S. Board ” means the Board of Governors of the Federal Reserve System of the United States or any successor thereto.
“ Facilities Termination Date ” means the date on which all Obligations owing to the Credit Parties or any of them, or remaining unpaid to the Credit Parties or any of them, under this agreement have been satisfied in full and the Credit Facilities have terminated pursuant to Section 2.5.
“ FATCA ” means Section 1471 through 1474 of the Code, as amended as of the date of this agreement (or any amended or successor version that is substantially comparable, and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b) of the Code and any intergovernmental agreements with respect thereto.
“ Federal Funds Effective Rate ” means, for any particular day, the variable rate of interest per annum, calculated on the basis of a year of 360 days and for the actual number of days elapsed, equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by Federal Funds brokers as published for such day (or, if such day is not a Banking Day, for the next preceding Banking Day) by the Federal Reserve Bank of New York or, for any Banking Day on which such rate is not so published by the Federal Reserve Bank of New York, from three Federal Funds brokers of recognized standing selected by the Administrative Agent.
“ Finance Documents ” means the Loan Documents, the Secured Capital Market Agreements and the Cash Management Agreements and “ Finance Document ” means any of the Finance Documents.
 
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“ Finance Obligations ” shall mean all indebtedness, obligations and liabilities (other than Excluded Obligations), present or future, absolute or contingent, matured or not, at any time owing by any of the Obligors to any of the Finance Parties, or remaining unpaid to any of the Finance Parties, under or in connection with any of the Finance Documents and Finance Obligations of a particular Obligor shall mean all indebtedness, obligations and liabilities, present or future, absolute or contingent, matured or not, at any time owing by such Obligor to any of the Finance Parties, or remaining unpaid to any of the Finance Parties, under or in connection with any of the Finance Documents to which such Obligor is a party. For certainty, “ Finance Obligations ” shall include interest accruing subsequent to the filing of, or which would have accrued but for the filing of, a petition for bankruptcy, in accordance with and at the rate (including any rate applicable upon any Default or Event of Default to the extent lawful) specified herein, whether or not such interest is an allowable claim in such bankruptcy proceeding and shall exclude any Excluded Obligations with respect to such Obligor.
“ Finance Obligations Termination Date ” means the date on which all Finance Obligations owing to the Finance Parties or any of them, or remaining unpaid to the Finance Parties or any of them, under all Finance Documents have been irrevocably satisfied and paid in full and no Finance Party has any obligation to extend credit or services to any Obligor under any Finance Document.
“ Finance Parties ” means the Credit Parties, the Qualified Capital Market Lenders and the Qualified Cash Management Lenders.
“ Financial Statements ” means the audited consolidated financial statements of Anixter Canada for the 2014 Fiscal Year and the unaudited consolidated financial statements of Anixter Canada for the Fiscal Quarter ended on or about June 30, 2015, including any notes to the financial statements.
“ Financing Lease ” means any lease of property, real or personal, the obligations of the lessee in respect of which are required in accordance with generally accepted accounting principles to be capitalized on the balance sheet of the lessee.
“ Fiscal Quarter ” means a 13 week (or periodically a 14 week) accounting period of Anixter Canada ending on or about the last day of each of March, June, September and December in each calendar year.
“ Fiscal Year ” means any of Anixter Canada’s accounting periods of four consecutive Fiscal Quarters ending on or about the last day of December in each calendar year. Any reference to, for example, the 2015 Fiscal Year, means the Fiscal Year ending closest to December 31, 2015.
“ generally accepted accounting principles ” or “GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public
 
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Accountants and statements and pronouncements of the financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession, that are applicable to the circumstances as of the date of determination, consistently applied.
“ Guarantees ” means one or more guarantees which have been entered into or are to be entered into by the Guarantors in favour of the Administrative Agent, each in form and substance satisfactory to the Administrative Agent, and pursuant to which each Guarantor guarantees the Finance Obligations of each other Obligor from time to time, including the guarantees described in Part I of Schedule H and the guarantee set forth in Article 15 hereof.
“ Guarantors ” means, from time to time, each Person which has executed and delivered to the Administrative Agent a Guarantee (including, without limitation, each Additional Guarantor) and “ Guarantor ” means any of the Guarantors.
“ Hazardous Materials ” means:
 
 	(a)	any petroleum product, asbestos, polychlorinated biphenyl (PCB), natural gas, natural gas liquids, liquefied natural gas or synthetic gas usable for fuel; or	
 
 	(b)	any pollutant or contaminant or hazardous or toxic chemical, material or substance within the meaning of any applicable federal, state, provincial or local law, regulation, ordinance or requirement (including consent decrees and administrative orders) relating to or imposing liability or standards of conduct concerning any hazardous or toxic waste, substance or material or concerning the environment or public health, all as in effect on the applicable date.	
“ HDS Acquisition ” means the Acquisition of all of the issued and outstanding Shares of Pro Canadian Holdings I, ULC by Anixter Canada pursuant to the Purchase Agreement.
“ Hypothecary Representative ” is defined in Section 14.1.
“ Indebtedness ” of any Person means, without duplication, (i) indebtedness for borrowed money of such Person and such Person’s redemption obligations in respect of mandatorily redeemable Preferred Stock, (ii) Purchase Money Obligations of such Person, (iii) other indebtedness of such Person which is evidenced by a note, bond, debenture or similar instrument, (iv) obligations of such Person under any Financing Lease, (v) all obligations of any Person under any Capital Market Agreement (or any other similar transaction including any option to enter into any Capital Market Agreement) measured on a marked-to-market basis at the time of determination, (vi) every reimbursement obligation of such Person with respect to letters of credit, bankers’ acceptances or similar facilities issued for the account of such Person, (vii) contingent obligations of such Person with respect to the Indebtedness of another Person (including any
 
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guarantee or indemnity of such Person in respect of Indebtedness of another Person (to the extent, with respect to any such indemnity, of the amount of such indemnity which is not in dispute)) and (viii) actual end of day indebtedness under any Cash Management Agreements. For certainty, “ Indebtedness ” shall not include trade payables and other accrued liabilities incurred by such Person in the ordinary course of business.
“ Indebtedness Prepayment Trigger Event ” means the receipt by any Obligor of any proceeds from the issuance or incurrence of Indebtedness which is not Permitted Indebtedness.
“ Indemnified Person ” shall have the meaning ascribed thereto in Section 8.4(a).
“ Indemnified Taxes ” means Taxes other than Excluded Taxes imposed on or with respect to any payment made by or on account of any obligation of the Borrowers under any Loan Document.
“ Individual Commitment ” means, with respect to a particular Lender and a particular Credit Facility, the amount set forth in Schedule A attached hereto, as reduced or amended from time to time pursuant to Sections 2.4, 8.2 and 16.6, as the Individual Commitment of such Lender with respect to such Credit Facility, provided that, upon the termination of a Credit Facility pursuant to Section 2.5, the Individual Commitment of each Lender with respect to such Credit Facility shall thereafter be equal to the amount of outstanding credit extended to the Borrowers by such Lender under such Credit Facility immediately prior to the termination of such Credit Facility.
“ Insurance Prepayment Trigger Event ” means the receipt by any Obligor of any property insurance proceeds (other than business interruption insurance proceeds or cargo insurance proceeds) in excess of $2,000,000 or the U.S. Dollar Equivalent thereof, where such proceeds or any portion thereof have not been used or committed by such Obligor to repair or replace the subject assets within 365 days of such Obligor’s receipt thereof.
“ Intellectual Property ” shall mean all of the (a) Canadian, United States and foreign registered and unregistered trade names, trademarks, service marks, domain names and other Internet addresses or identifiers, trade dress, corporate names and similar rights thereto, including any registrations for and applications (including intent to use applications) to register any of the foregoing, all renewals thereof and all goodwill associated therewith; (b) Canadian, United States and foreign patents and patent applications, including all provisional, divisions, continuations, continuations in part and reissues; (c) Canadian, United States and foreign registered and unregistered copyrights and applications for registration, renewals and extensions in connection any such registrations, together with all translations thereof; (d) trade secrets, know-how, inventions, invention disclosures, methods, processes, technical data, specifications, techniques, research and development information, technology, product roadmaps, drawings,
 
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designs, plans, proposals, financial, marking and business data, pricing and cost information, customer and supplier lists and any other confidential information (collectively, “ Trade Secrets ”); and (e) moral rights, publicity rights, database rights, mask works, utility and industrial models and registrations and applications for registration thereof, and any other proprietary or intellectual property rights of any kind or nature that do not comprise or are not protected by trademarks, patents, copyrights or Trade Secrets.
“ Intercompany Debt ” means any Indebtedness from time to time owing by any member of the Borrowing Group to the Ultimate Parent or any Affiliate thereof including, without limitation Indebtedness owing under the Intercompany Notes.
“ Intercompany Notes ” means:
 
 	(a)	the promissory note dated December 31, 2014 made by Anixter Canada in favour of 9112855 Canada Inc. in the principal amount of Cdn $105,856,600; and	
 
 	(b)	the amended and restated promissory note dated May 1, 2015 made by Anixter Canada in favour of XpressConnect Supply Inc. in the principal amount of Cdn $197,300,000.	
“ Interest Charges ” means, for any period, for the Borrowing Group on a combined basis, the sum, without duplication, of (a) combined interest expenses determined in accordance with generally accepted accounting principles minus (b) the amount of non-cash interest (including interest on the Intercompany Notes, to the extent that it is a non-cash payment).
“ Interest Coverage Ratio ” means the ratio of (a) Borrowing Group EBITDA for the period of the four most recently completed consecutive Fiscal Quarters ending on the last day of such period to, provided that , for the purposes of calculating the Interest Coverage Ratio, Borrowing Group EBITDA shall be calculated on a pro forma basis in accordance with generally accepted accounting principles to the extent necessary to give effect to (i) any Acquisition made by the Borrowing Group during such period (without giving effect to any increase in Borrowing Group EBITDA reflecting projected synergies resulting from such Acquisition) so long as, and to the extent that, (X) Anixter Canada delivers to the Administrative Agent (which shall promptly deliver to each Lender) a summary in reasonable detail of the assumptions underlying, and the calculations made, in computing Borrowing Group EBITDA on a pro forma basis, and (Y) the Majority Lenders do not object to such assumptions and/or calculations within 10 Banking Days after receipt thereof, and (ii) any divestiture of a Subsidiary, division or other operating unit made during such period to (b) Interest Charges for the corresponding period.
 
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“ Interest Period ” means, in the case of any LIBOR Loan, the applicable period for which interest on such LIBOR Loan shall be calculated in accordance with Article 7 of this agreement.
“ Investment ” shall mean any advance, loan, extension of credit or capital contribution to, purchase of Shares, bonds, notes, debentures or other securities of, or any other investment made in, any Person but shall exclude any Acquisition, any acquisition of tangible personal property and any Capital Expenditures. The amount of any Investment shall be the original principal or capital amount thereof less all returns of principal or equity, or distributions or dividends paid, thereon and shall, if made by the transfer or exchange of property other than cash, be deemed to have been made in an original principal or capital amount equal to the fair value of such property at the time of such Investment, as determined in good faith by the Borrowers.
“ Issuing Lender ” means The Bank of Nova Scotia or any other Lender selected by the Administrative Agent and acceptable to the Borrowers who assumes in writing the obligation of issuing Letters under the RT Facility.
“ Lead Arranger Fee Letter ” means the lead arranger fee letter dated July 31, 2015 between Anixter Canada, The Bank of Nova Scotia and Bank of America N.A., Canada Branch, as the same may be amended, modified, supplemented or replaced from time to time.
“ Letter ” means a standby letter of credit or letter of guarantee denominated in Canadian or United States dollars (or such other currency agreed to by the Issuing Lender in its sole discretion) and in form satisfactory to and issued by an Issuing Lender for a term not exceeding one year, or as otherwise agreed to by such Issuing Lender, whereby such Issuing Lender, acting at the request and on the credit of a Borrower and in accordance with the instructions of such Borrower, is to make payment in accordance with the terms and conditions thereof of an amount to or to the order of a third party.
“ Letter Fee Letter ” means the fee letter of even date herewith entered into between the Issuing Lender and the Borrowers establishing a customary fronting fee for Letters issued hereunder at all times that there are two or more Lenders with Individual Commitments under the RT Facility.
“ LIBOR ” means, with respect to any Interest Period applicable to a LIBOR Loan, the per annum rate of interest determined by the Administrative Agent, based on a 360 day year as the rate for deposits in United States dollars appearing on the display referred to as the “ LIBOR 01 Page ” (or any display substituted therefor) of Reuter Monitor Money Rates Service for a period equal to the number of days in the applicable Interest Period, at or about 11:00 a.m. (London, England time) on the second Banking Day prior to the first day of such Interest Period. If such “ LIBOR 01 Page ” is not available, then “ LIBOR ” shall mean, with respect to any such Interest Period, the per annum rate of interest, based on a 360 day year
 
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(rounded upwards, if necessary, to the nearest 1/100th of one percent) determined by the Administrative Agent at approximately 11:00 a.m. (London, England time) (or so soon thereafter as practicable) on the second Banking Day prior to the first day of such Interest Period offered to the Administrative Agent by leading banks in the London interbank market for the placing of United States dollar deposits with the Administrative Agent having a term comparable to such Interest Period and in an amount comparable to the principal amount of the applicable LIBOR Loan. In no event shall LIBOR be less than zero.
“ LIBOR Loan ” means monies lent by the Lenders to a Borrower in United States dollars and upon which interest accrues at a rate referable to LIBOR.
“ Lien ” means any mortgage, charge, hypothec, assignment, pledge, lien, vendor’s privilege, supplier’s right of reclamation or other security interest or encumbrance of whatever kind or nature, regardless of form and whether consensual or arising by law (statutory or otherwise), that secures the payment of any Indebtedness or liability or the observance or performance of any obligation.
“ Loan Documents ” means this agreement, the Guarantees, the Security Documents, the Postponement and Subordination Agreements, the Post-Closing Undertaking, the Perfection Certificates, the Agency Fee Letter, the Letter Fee Letter, the Lead Arranger Fee Letter, the Parent Indemnity and each other agreement, document or instrument executed and delivered pursuant hereto or thereto.
“ Loan Parties ” means, at any particular time, the Obligors and any Subsidiary of the Ultimate Parent which is a party to a Postponement and Subordination Agreement at such time and “ Loan Party ” means any one of the Loan Parties.
“ Loans ” means Prime Rate Loans, BA Equivalent Loans, Base Rate Canada Loans and LIBOR Loans.
“ Majority Lenders ” (i) means, with respect to a matter relating solely to a particular Credit Facility and at any particular time up to the termination of such Credit Facility pursuant to Section 2.3, such group of relevant Lenders (and, if there is more than one relevant Lender, at least two relevant Lenders) whose Individual Commitments with respect to such Credit Facility aggregate at least 66.7% of the Total Commitment Amount for such Credit Facility at such time and, at any particular time after the termination of such Credit Facility pursuant to Section 2.5 until the Facilities Termination Date, such group of relevant Lenders which have, in the aggregate, extended credit which is outstanding under such Credit Facility in an amount at least 66.7% of the aggregate amount of credit outstanding under the such Credit Facility at such time after giving effect to all necessary adjustments pursuant to Section 14.16, or (ii) means, if not referable to a matter relating solely to a particular Credit Facility, at any particular time up to the termination of the Credit Facilities pursuant to Section 2.5, such group of Lenders (and, if there is more than one Lender, at least two Lenders) whose
 
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Individual Commitments aggregate at least 66.7% of the Total Commitment Amount for both Credit Facilities at such time and, at any particular time after the termination of the Credit Facilities pursuant to Section 2.5 until the Facilities Termination Date, such group of Lenders which have, in the aggregate, extended credit which is outstanding hereunder in an amount at least 66.7% of the aggregate amount of credit outstanding hereunder at such time after giving effect to all necessary adjustments pursuant to Section 14.16.
“ Material Adverse Change ” means any change of circumstances or any event which has a Material Adverse Effect.
“ Material Adverse Effect ” means a material adverse effect (or a series of adverse effects, none of which is material in and of itself but which, cumulatively, result in a material adverse effect) on:
 
 	(a)	the business, operations, property, assets or financial condition of Obligors considered as a whole; or	
 
 	(b)	the ability of the Obligors, taken as a whole, to perform their obligations under the Loan Documents to which they are a party.	
“ Material Canadian Subsidiary ” means, at any particular time, any direct or indirect Subsidiary of Anixter Canada which is incorporated or otherwise formed under the laws of Canada or any province or territory thereof and in respect of which:
 
 	(a)	the product obtained by multiplying (i) the percentage of the equity Shares of such Subsidiary directly or indirectly owned by Anixter Canada at such time by (ii) the gross revenues of such Subsidiary for the most recently completed four consecutive Fiscal Quarters, is greater than or equal to 5% of the gross revenues of Anixter Canada on an Adjusted Consolidated Basis for the most recently completed four consecutive Fiscal Quarters, in each case expressed in Canadian dollars; or	
 
 	(b)	the product obtained by multiplying (i) the percentage of the equity Shares directly or indirectly owned by Anixter Canada at such time by (ii) the book value of the assets of such Subsidiary as at the last day of the most recently completed fiscal year of such Subsidiary, is greater than or equal to 5% of the assets of Anixter Canada on an Adjusted Consolidated Basis as of the last day of the most recently completed Fiscal Quarter, in each case expressed in Canadian dollars.	
“ Material Contracts ” means any contract (other than any Finance Document) to which an Obligor (or, solely for the purpose of Section 10.1(c), another Loan Party) is or becomes a party at any time that, if terminated, has or could reasonably be expected to have a Material Adverse Effect.
 
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“ Material Permit ” means any Official Body Consent issued at any time to an Obligor (or, solely for the purpose of Section 10.1(c), another Loan Party) that, if terminated, has or could reasonably be expected to have a Material Adverse Effect.
“ Maturity Date ” means October 5, 2020 .
“ Multiemployer Plan ” shall mean any “multiemployer plan” (as such term is defined in section 3(37) or section 4001(a)(3) of ERISA).
“ Net Cash Proceeds ” means, with respect to any Prepayment Trigger Event, the gross cash proceeds (including payments from time to time in respect of installment obligations, if any) received by or on behalf of an Obligor in respect of such Prepayment Trigger Event less the sum of:
 
 	(a)	the amount, if any, of all Taxes paid or estimated to be payable by or on behalf of the Obligor in connection with such Prepayment Trigger Event;	
 
 	(b)	amounts required to be applied to the repayment of Indebtedness secured by a Permitted Lien ranking in priority to the Security on any property disposed of in connection with such Prepayment Trigger Event;	
 
 	(c)	the amount of any reasonable reserve required to be established in accordance with GAAP against any liabilities (except Taxes deducted pursuant to item (a) above) (i) associated with any property disposed of in connection with such Prepayment Trigger Event, and (ii) retained by the Obligor, provided that the amount of any subsequent reduction of the reserve (except in connection with a payment in respect of any liability) shall be deemed to be Net Cash Proceeds received on the date of the reduction; and	
 
 	(d)	reasonable and customary fees, commissions, expenses, issuance costs, deductibles, discounts and other costs paid by or on behalf of the Obligor in connection with such Prepayment Trigger Event.	
“ Net Income ” means, for any particular period, the amount (expressed in Canadian dollars) which would be classified as the net income of the Borrowing Group for such period as net income, determined in accordance with Section 1.16; provided that Net Income shall be exclusive of any non-recurring, unusual and extraordinary gain or loss and dividend and interest income.
“ Non-FATCA Compliant Lender ” means any Lender hereunder who is in breach of its obligations under FATCA.
“ Non-Schedule I Lenders ” means the Lenders that are not Schedule I Lenders, including Lenders that are listed in Schedule II or Schedule III to the Bank Act (Canada).
 
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“ Non-U.S. Plan ” shall mean any plan, fund or other similar program that (a) is established or maintained outside the United States of America by any of the Companies primarily for the benefit of employees of such member residing outside the United States of America, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and (b) is not subject to ERISA or the Code.
“ NRT Credit Limit ” means $300,000,000 or the U.S. Dollar Equivalent thereof, as such amount may be reduced from time to time pursuant to Section 2.4.
“ NRT Drawn Amount ” means the principal amount of credit under the NRT Facility drawn by Anixter Canada on the date of the sole drawdown thereunder.
“ NRT Facility ” shall have the meaning ascribed thereto in Section 2.1(b).
“ NRT Obligations Termination Date” means the date on which all Obligations of Anixter Canada under the NRT Facility have been irrevocably paid in full and the relevant Lenders have no commitments to provide credit to Anixter Canada thereunder.
“ Obligations ” shall mean only those Finance Obligations which arise under or pursuant to the Loan Documents.
“ Obligors ” means, at any particular time, the Borrowers and the Guarantors at such time and “ Obligor ” means any of the Obligors.
“ Official Body ” means any national government or government of any political subdivision thereof, or any parliament, legislature, council, agency, authority, board, central bank, monetary authority, commission, department or instrumentality thereof, or any court, tribunal, grand jury, mediator or arbitrator, whether foreign or domestic, in each case having jurisdiction in the relevant circumstances.
“ Official Body Consent ” means any licence, right, permit, franchise, privilege, registration, direction, decree, consent, order, permission, approval or authority issued or provided by an Official Body.
“ Order ” means an order, judgment, injunction or such other determination of an Official Body restricting payment by an Issuing Lender under and in accordance with a Letter or extending such Issuing Lender’s liability under a Letter beyond the expiration date stated therein.
“ Parent ” means Anixter, Inc., a corporation incorporated under the laws of Delaware.
“ Parent Indemnity ” means the indemnity agreement dated the date hereof between the Parent and the Administrative Agent pursuant to which the Parent has agreed to indemnify the Credit Parties in respect of cash on deposit in the BMG Account.
 
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“ PBGC ” means Pension Benefit Guaranty Corporation or any governmental body succeeding to its functions.
“ Pension Plan ” means (a) a “pension plan” or “plan” which is a “registered pension plan” as defined in the Income Tax Act (Canada) or pension benefits standards legislation in any jurisdiction of Canada and is applicable to employees resident in Canada of an Obligor, and (b) any other defined benefit, supplemental pension benefit plan or similar arrangement applicable to any employee of an Obligor.
“ Perfection Certificate ” means, in respect of each Obligor, the certificate of a Senior Officer of such Obligor, addressed to the Administrative Agent, in form and substance satisfactory to the Administrative Agent and pursuant to which certain factual matters relating to such Obligor and the Secured Assets of such Obligor are certified true and correct, together with all schedules and exhibits attached thereto or referred to therein, as the same may be updated from time to time pursuant to Section 11.1(b)(vi).
“ Permitted Acquisitions ” means any Acquisition with respect to which:
 
 	(a)	the business of the entity being acquired is, (in the case of a share Acquisition) or the assets being acquired are used in or relate to, (in the case of an asset Acquisition) a business that is permitted under Section 11.3(d);	
 
 	(b)	no Default exists at the time of such proposed Acquisition and no Default would exist immediately after the implementation of any such proposed Acquisition;	
 
 	(c)	the financial covenants set out in Sections 11.1(g) and (h) would in each case, on a pro forma basis immediately after giving effect to the implementation of any such Acquisition be inside .25 of the stated financial covenant levels set forth therein (i.e. the pro forma Interest Coverage Ratio would be greater than or equal to 2.75 to 1 and the Total Leverage Ratio would be less than or equal to 4.00 to 1, 3.50 to 1 or 3.0 to 1 dependent upon the timing of the subject Acquisition).	
“ P ermitted Distribution ” means
 
 	(a)	the payment of Cash dividends to any Secured Obligor; and	
 
 	(b)	the payment of Cash dividends by Anixter Canada in an amount equal to	
 
 	(i)	50% of Excess Cash Flow at any time that the Total Leverage Ratio, calculated on a pro forma basis after accounting for such Distribution, would be less than 3.00 to 1 but greater than or equal to 2.00 to 1.00; or	
 
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 	(ii)	100% of Excess Cash Flow at any time that the Total Leverage Ratio, calculated on a pro forma basis after accounting for such Distribution, would be less than 2.00,	
provided, in each of the foregoing cases, no Default has occurred and is continuing at the time of, and no Default would occur or arise immediately after or as a result of, the relevant Distribution.
“ Permitted Indebtedness ” means (without duplication):
 
 	(a)	the Finance Obligations;	
 
 	(b)	Indebtedness consented to by the Majority Lenders;	
 
 	(c)	Indebtedness secured by a Permitted Lien;	
 
 	(d)	Financing Leases and Purchase Money Obligations in an aggregate amount not to exceed $20,000,000;	
 
 	(e)	corporate credit card or purchasing card arrangements subject to an aggregate limit of $2,000,000;	
 
 	(f)	Intercompany Debt;	
 
 	(g)	Indebtedness under the Subordinate Debt Documents to the extent the creditor under any such Subordinate Debt Document has executed and delivered to the Administrative Agent a Postponement and Subordination Agreement and any other Indebtedness owed to the Ultimate Parent or any Affiliate thereof which is subject to a Postponement and Subordination Agreement;	
 
 	(h)	Permitted Investment Indebtedness;	
 
 	(i)	unsecured obligations of a Company in respect of performance, bid, appeal and surety bonds or other similar instruments in respect of its contracts, in each case in the ordinary course of business or consistent with past practice provided that the aggregate amount thereof does not at any time exceed $50,000,000 in the aggregate;	
 
 	(j)	Indebtedness under Capital Market Agreements that do not contravene Section 11.3(i); and	
 
 	(k)	other Indebtedness (not otherwise referred to in this definition) of the Companies other than the Borrowing Group, at any particular time, in an aggregate principal amount outstanding not exceeding US $125,000,000.	
 
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“ Permitted Investment Indebtedness ” means any Indebtedness of any Obligor resulting from a Permitted Investment or a Permitted Acquisition which existed prior to, and not in contemplation of, such Investment or Acquisition (or any Indebtedness incurred in refinancing such Indebtedness of any Obligor provided that the amount thereof is not increased).
“ Permitted Investments ” means the following Investments:
 
 	(a)	such Investment is a Secured Asset;	
 
 	(b)	Investments in Cash and Cash Equivalents;	
 
 	(c)	extensions of trade credit and asset purchases in the ordinary course of business;	
 
 	(d)	Investments made by any Obligor in any Secured Obligor; and	
 
 	(e)	Investments in Companies other than the Secured Obligors that (i) exist as of the date of this agreement, (ii) are made after the date of this agreement in an aggregate amount outstanding of up to $30,000,000 for all Secured Obligors at any time, or (iii) may be considered to be made as a result of the deposit and related arrangements referred to in Section 11.4.	
“ Permitted Liens ” means, with respect to any Person, the following:
 
 	(a)	liens for taxes, assessments or governmental charges or levies which are not yet due, or for which installments have been paid based on reasonable estimates pending final assessments, or the validity of which is being contested in good faith by appropriate proceedings and for which the Person has recorded the liability in accordance with GAAP and which do not have, and will not reasonably be expected to have, a Material Adverse Effect;	
 
 	(b)	inchoate or statutory liens of contractors, subcontractors, mechanics, workers, suppliers, material men, carriers and others in respect of construction, maintenance, repair or operation of assets of the Person, in respect of which adequate holdbacks are being maintained as required by Applicable Laws and (i) which have not at such time been filed or exercised and of which none of the Lenders have been given notice, or (ii) which relate to obligations not due or payable or if due, the validity of which is being contested in good faith by appropriate proceedings and for which such Person has recorded the liability in accordance with GAAP and which do not materially reduce the value of the affected asset or materially interfere with the use of such asset in the operation of the business of the Person and do not have, and will not reasonably be expected to have, a Material Adverse Effect;	
 
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 	(c)	easements, rights-of-way, licences, servitudes, restrictions, restrictive covenants, and similar rights in real property comprised in the assets of the Person or interests therein (including in respect of sewers, drains, gas and water mains or electric light and power or telephone and telegraph conduits, poles, wires and cables) which do not materially reduce the value of the affected asset or materially interfere with the use of such asset in the operation of the business of the Person and do not have, and will not reasonably be expected to have, a Material Adverse Effect;	
 
 	(d)	title defects or irregularities which are of a minor nature and which do not materially reduce the value of the affected asset or materially interfere with the use of such asset in the operation of the business of the Person and do not have, and will not reasonably be expected to have, a Material Adverse Effect;	
 
 	(e)	the Lien resulting from the deposit of cash or securities in connection with contracts, tenders or expropriation proceedings, or to secure workers’ compensation, employment insurance, surety or appeal bonds, costs of litigation when required by Applicable Laws and other similar obligations, in each case in the ordinary course of business;	
 
 	(f)	the Lien created by a judgment of a court of competent jurisdiction; provided, however, that the Lien is in existence for less than 20 days after its creation or the execution or other enforcement of the Lien is effectively stayed or the claims so secured are being actively contested in good faith and by proper legal proceedings and do not result in the occurrence of an Event of Default;	
 
 	(g)	the reservations, limitations, provisos and conditions, if any, expressed in any original grant from the Crown of any real property or any interest therein which do not materially reduce the value of the affected asset or materially interfere with the use of such asset in the operation of the business of the Person and do not have, and will not reasonably be expected to have, a Material Adverse Effect;	
 
 	(h)	Liens given to a public utility or any municipality or governmental or other public authority when required by such utility or other authority in connection with the operation of the business or the ownership of the assets of the Person which do not materially reduce the value of the affected asset or materially interfere with the use of such asset in the operation of the business of the Person and do not have, and will not reasonably be expected to have, a Material Adverse Effect;	
 
 	(i)	servicing agreements, development agreements, site plan agreements, and other agreements with Official Body pertaining to the use or development of any of the assets of the Person, provided same are complied with and do not materially reduce the value of the affected asset or materially interfere	
 
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 	with the use of such asset in the operation of the business of the Person and do not have, and will not reasonably be expected to have, a Material Adverse Effect;	
 
 	(j)	the right reserved to or vested in any Official Body by any statutory provision or by the terms of any lease, licence, franchise, grant or permit of the Person, to terminate any such lease, licence, franchise, grant or permit, or to require annual or other payments as a condition to the continuance thereof;	
 
 	(k)	Liens in favour of the Administrative Agent created by the Security Documents including Liens over Secured Assets;	
 
 	(l)	landlords’ rights of distraint and similar rights of a landlord (including in Quebec a landlord’s hypothec) on tangible personal or moveable property of the Person located solely on the premises leased by the landlord to the Person and securing only the obligations of the Person under the applicable lease of the premises, so long as the exercise of such rights do not result in the occurrence of an Event of Default;	
 
 	(m)	Liens securing the Indebtedness referenced in paragraph (d) of the definition of Permitted Indebtedness;	
 
 	(n)	Liens over Property of Companies other than the Borrowing Group securing Indebtedness of those Companies up to an aggregate principal amount of US$25,000,000 outstanding at any time;	
 
 	(o)	Lien on the BMG Account in favour of Bank Mendes Gans N.V. as security for its account netting exposure pursuant to the banking arrangement referenced in Section 11.4; and	
 
 	(p)	the extension, renewal or refinancing of any Permitted Lien, provided that such Liens do not extend to any additional assets, property or undertaking of the relevant Company.	
“ Person ” means any natural person, corporation, firm, partnership, joint venture, joint stock company, incorporated or unincorporated association, government, governmental agency or any other entity, whether acting in an individual, fiduciary or other capacity.
“ Plan ” means an “employee benefit plan” (as defined in section 3(3) of ERISA and other than a Multiemployer Plan) subject to Title IV of ERISA, or Section 412 of the Code that is or, within the preceding five years, has been established or maintained, or to which contributions are or, within the preceding five years, have been made or required to be made, by any Borrower or any ERISA Affiliate or with respect to which any Borrower or any ERISA Affiliate may have any liability.
 
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“ Pledged Companies ” means those Companies the Shares of which have been pledged to the Administrative Agent pursuant to a Security Document, including, without limitation each Company referenced under the column “Pledged Company” in Schedule L hereto.
“ Post-Closing Undertaking ” means the post-closing undertaking dated the date hereof entered into by the Borrowers in favour of the Administrative Agent pursuant to which the Borrowers covenant and agree to deliver, or cause to be delivered, the documents referenced therein.
“ Postponement and Subordination Agreement ” means each postponement and subordination agreement to be entered into from time to time by the Ultimate Parent or any Subsidiary thereof (other than an Obligor) which is a creditor of an Obligor, in form and substance satisfactory to the Administrative Agent.
“ PPSA ” means the Personal Property Security Act (Ontario), as amended.
“ Preferred Stock ” shall mean any class of Shares of a corporation that is preferred over any other class of Shares of such corporation as to the payment of dividends or the payment of any amount upon liquidation or dissolution of such corporation.
“ Prepayment Notice ” shall have the meaning ascribed thereto in Section 9.4.
“ Prepayment Trigger Event ” means an Indebtedness Prepayment Trigger Event, an Insurance Prepayment Trigger Event or the Asset Sale Prepayment Trigger Event.
“ Primary Obligors ” means Anixter Mid Holdings and the Borrowers and includes the Parent and the Ultimate Parent if they become Guarantors pursuant to Section 14.25(b) and “ Primary Obligor ” means any one of the Primary Obligors.
“ Prime Rate ” means the greater of (i) the variable rate of interest per annum equal to the rate of interest determined by the Administrative Agent from time to time as its prime rate for Canadian dollar loans made by the Administrative Agent in Canada from time to time, being a variable per annum reference rate of interest adjusted automatically upon change by the Administrative Agent calculated on the basis of a year of 365 days or 366 days in the case of a leap year and (ii) the sum of (a) the BA Schedule I Rate for a 30 day term, and (b) 1% per annum.
“ Prime Rate Loan ” means monies lent by the Lenders to a Borrower hereunder in Canadian dollars and upon which interest accrues at a rate referable to the Prime Rate.
 
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“ Pro Rata Share ” means:
 
 	(a)	when used with reference to a particular Credit Facility at any particular time and with respect to a particular Lender, the ratio of the Individual Commitment of such Lender with respect to such Credit Facility at such time to the aggregate of the Individual Commitments of all of the Lenders with respect to such Credit Facility at such time; and	
 
 	(b)	when used without reference to a particular Credit Facility but at any particular time and with respect to a particular Lender, the ratio of the aggregate Individual Commitments of such Lender with respect to both of the Credit Facilities at such time to the aggregate of the Individual Commitments of all of the Lenders with respect to both of the Credit Facilities at such time.	
“ Proceeds of Realization ” means all cash and non-cash proceeds derived from any sale, disposition or other realization of the Secured Assets or received from any Obligor pursuant to a Guarantee or a Security Document (i) after any notice being sent by the Administrative Agent to the Borrowers pursuant to Section 13.1 declaring all indebtedness of the Borrowers hereunder to be immediately due and payable, (ii) upon any dissolution, liquidation, winding-up, reorganization, bankruptcy, insolvency or receivership of a Borrower (or any other arrangement or marshalling of the Secured Assets that is similar thereto) or (iii) upon the enforcement of, or any action taken with respect to, any of the Guarantees or the Security Documents.
“ Property ” means all present or future real property which is owned, leased, operated, occupied, controlled or used by the Companies.
“ Purchase Agreement ” means the purchase agreement dated as of July 15, 2015 entered into among HD Supply, Inc., HD Supply Holdings LLC, HD Supply GP & Management, Inc., HD Supply Power Solutions Group, Inc., and Brafaso Holdings II, Inc., as vendors and the Parent, as purchaser and Anixter Canada, as assignee of certain of the Parent’s rights thereunder.
“ Purchase Agreement Representations ” means the representations and warranties made by the Vendors in the Purchase Agreement as are material to the interests of the Lead Arrangers.
“ Purchase Money Obligations ” means Indebtedness arising in the ordinary course of business which is assumed as part of, or issued or incurred to pay or provide funds to pay, all or a part of the purchase price of any personal or moveable property but specifically excluding Indebtedness under Financing Leases.
“ Qualified Affiliate ” means an Affiliate of a Lender who has executed and delivered to the Administrative Agent an instrument of adhesion in the form set forth in Schedule I.
 
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“ Qualified Capital Market Lender ” means (x) any Person that enters into a Secured Capital Market Agreement at a time when such Person is a Lender or (y) any Qualified Affiliate that enters into a Secured Capital Market Agreement at a time when the Lender with which such Qualified Affiliate is affiliated is a Lender.
“ Qualified Cash Management Lender ” means (x) any Person that enters into a Cash Management Agreement at a time when such Person is a Lender or (y) any Qualified Affiliate that enters into a Cash Management Agreement at a time when the Lender with which such Qualified Affiliate is affiliated is a Lender.
“ Qualified ECP Guarantor ” means, in respect of any Capital Market Obligation, each Obligor that has total assets exceeding U.S. $10,000,000 at the time the relevant Guarantee becomes effective with respect to such Capital Market Obligation or such other Person as constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another Person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act .
“ Release ” means a “discharge”, as such term is defined in the EPA.
“ Reporting Date ” means, for each of the first three Fiscal Quarters of each Fiscal Year, the date which is 45 days after the end of each such Fiscal Quarter and, for the fourth Fiscal Quarter of each Fiscal Year, the date which is 90 days after the end of each such Fiscal Quarter.
“ Rollover Notice ” shall have the meaning ascribed thereto in Section 5.3.
“ RT Credit Limit ” means $25,000,000 or the U.S. Dollar Equivalent thereof, as such amount may be reduced from time to time pursuant to Section 2.4.
“ RT Facility ” shall have the meaning ascribed thereto in Section 2.1(a).
“ Sanctioned Activities ” means business activities that are subject to sanctions/embargos imposed by Canada, by the Swiss State Secretariat for Economic Affairs, the United Nations, the European Union and/or the United States (including the Office of Foreign Assets Control).
“ Sanctioned Countries ” means, at any time, countries that are then subject to Sanctions.
“ Sanctioned Persons ” means persons or entities named on any sanctions lists issued by one of the Swiss State Secretariat for Economic Affairs, the United Nations Security Council, the European Union, the United States Office of Foreign Assets Control and/or the United States Department of the Treasury.
 
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“ Sanctions ” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by:
 
 	(a)	the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of Treasury or the U.S. Department of State; or	
 
 	(b)	the Canadian government, the United Nations, the European Union or Her Majesty’s Treasury of the United Kingdom.	
“ Schedule I Lenders ” means the Lenders that are listed in Schedule I to the Bank Act (Canada).
“ Secured Assets ” means:
 
 	(a)	all of the present and future assets, property and undertaking of each Borrower, Anixter Canadian Holdings ULC, WireXpress Ltd., 9112855 Canada Inc. and each Additional Guarantor;	
 
 	(b)	all of the present and future Shares issued by Anixter Canada; and	
 
 	(c)	any and all proceeds of any of the foregoing.	
“ Secured Capital Market Agreement ” means any Capital Market Agreement which any Obligor enters into in the ordinary course of business with a Qualified Capital Market Lender.
“ Secured Obligor ” means a Person which has granted, or is required pursuant to the terms hereof to grant, to the Administrative Agent a perfected Lien in all of its present and after acquired property pursuant to one or more Security Documents.
“ Security ” means the collateral security constituted by the Security Documents.
“ Security Documents ” means the security documents which, in the reasonable opinion of the Administrative Agent, are required to be entered into from time to time by certain of the Obligors in favour of the Administrative Agent in order to grant to the Administrative Agent a Lien on the Secured Assets as continuing collateral security for the payment and performance of the Finance Obligations, such security documents to be in form and substance satisfactory to the Administrative Agent and to include the security documents described in Schedule H hereto, but notwithstanding any other term of this agreement, (i) no security document will create a fixed charge or hypothec on a freehold or leasehold interest in real or immovable property and (ii) no security or pledge agreement governed by Dutch law shall be required for the purpose of charging the BMG Account.
“ Shares ”, as applied to the shares of any corporation or other entity, means the shares or other ownership interests of every class whether now or hereafter authorized, regardless of whether such shares or other ownership interests shall be limited to a fixed sum or percentage with respect to the rights of the holders thereof to participate in dividends or distributions and in the distribution of assets upon the voluntary or involuntary liquidation, dissolution or winding-up of such corporation or other entity.
 
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“ Specified Representations ” means the representations and warranties in Sections 10.1(a), (b), (c), (g) (to the extent that (g) relates to AML/CTF Laws, Sanctioned Activities, Sanctioned Countries and Sanctioned Persons), (y), (z), (bb) and (dd).
“ Subordinate Debt Documents ” means:
 
 	(a)	the Intercompany Notes;	
 
 	(b)	the amended and restated Forward Subscription and Purchase Agreement dated May 1, 2015, between Anixter Canada and Anixter Mid Holdings;	
 
 	(c)	the forward subscription agreement dated May 1, 2015 between XpressConnect Supply Inc. and Anixter Total Holdings C.V.; and	
 
 	(d)	the guarantee dated May 1, 2015 made by XpressConnect Supply Inc. in favour of Anixter Canada, whereby XpressConnect Supply Inc. guarantees the obligations of Anixter Mid Holdings under the Forward Subscription and Purchase Agreement referred to in item (b) immediately above.	
“ Subsidiary ” means, at any time, as to any Person, any other Person, if at such time the first mentioned Person owns, directly or indirectly, securities or other ownership interests in such other Person, having ordinary voting power to elect a majority of the board of directors or persons performing similar functions for such other Person. For greater certainty, “ Subsidiary ” shall include, at any time, as to any Person, any general partnership in which such first mentioned Person owns, directly or indirectly, a majority of the partnership interests therein.
“ Swingline Availability ” has the meaning given to it in Section 3.1(a)(ii)).
“ Swingline Lender ” means The Bank of Nova Scotia.
“ Target ” means Pro Canadian Holdings I, ULC, an unlimited liability company formed under the laws of Nova Scotia.
“ Tax ” or “ Taxes ” means any and all taxes, assessments, fees, rates, levies, imposts, deductions, dues, duties and other charges of any nature, including any interest, fines, penalties or other liabilities with respect thereto, imposed, levied, collected, withheld or assessed by any Official Body (including a federal, provincial, territorial, municipal or foreign Official Body), and whether disputed or not.
“ Tax Act ” means the Income Tax Act (Canada), as amended from time to time, and any successor statute and including all regulations issued under all such statutes.
 
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“ Total Commitment Amount ” means, with respect to a particular Credit Facility or both Credit Facilities, as the context so requires, at any particular time, the aggregate of the Individual Commitments with respect thereto of all of the relevant Lenders at such time.
“ Total Debt ” means, at any time, the aggregate, without duplication, of all Indebtedness of the Borrowing Group at such time.
“ Total Leverage Ratio ” means, at any time, the ratio calculated by dividing (a) Total Debt (excluding the amount of the Intercompany Debt) at that time by (b) Borrowing Group EBITDA for the four most recently completed consecutive Fiscal Quarters, provided that, for the purposes of calculating the Total Leverage Ratio, Borrowing Group EBITDA shall be calculated on a pro forma basis in accordance with generally accepted accounting principles to the extent necessary to give effect to (i) any Acquisition made by the Borrowing Group during such period (without giving effect to any increase in Borrowing Group EBITDA reflecting projected synergies resulting from such Acquisition) so long as, and to the extent that, (X) Anixter Canada delivers to the Administrative Agent (which shall promptly deliver to each Lender) a summary in reasonable detail of the assumptions underlying, and the calculations made, in computing Borrowing Group EBITDA on a pro forma basis, and (Y) the Majority Lenders do not object to such assumptions and/or calculations within 10 Banking Days after receipt thereof, and (ii) any divestiture of a Subsidiary, division or other operating unit made during such period.
“ Trade Secrets ” shall have the meaning specified in the definition of “Intellectual Property”.
“ Transaction Documents ” means the Purchase Agreement and the assignment agreement dated October 1, 2015 between the Parent and Anixter Canada pursuant to which the Parent assigned certain of its rights under the Purchase Agreement to Anixter Canada.
“ Ultimate Parent ” means Anixter International, Inc., a corporation incorporated under the laws of Delaware.
“ Vendors ” means those parties referenced as vendors in the definition of Purchase Agreement.
“ Welfare Plan ” means any life, medical, health, dental, hospitalization, disability, travel, accident, accidental health and dismemberment insurance or other employee benefit or welfare plan, agreement or arrangement, other than a Pension Plan, applicable to any employee of any Obligor, whether or not insured and whether or not subject to any Applicable Laws, but excludes any statutory plans with which any Obligor is required to comply, including the Canada Pension Plan or plans administered pursuant to applicable provincial health, workers’ compensation and employment insurance legislation .
 
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“ Withdrawal Liability ” shall mean liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA .
 
1.2	Other Usages.	
References to “this agreement”, “the agreement”, “hereof”, “herein”, “hereto” and like references refer to this Credit Agreement and not to any particular Article, Section or other subdivision of this agreement. Any references herein to any agreements or documents shall mean such agreements or documents as amended, restated, supplemented or otherwise modified from time to time in accordance with the terms hereof and thereof.
 
1.3	Plural and Singular.	
Where the context so requires, words importing the singular number shall include the plural and vice versa.
 
1.4	Headings.	
The division of this agreement into Articles and Sections and the insertion of headings in this agreement are for convenience of reference only and shall not affect the construction or interpretation of this agreement.
 
1.5	Currency.	
Unless otherwise specified herein, all statements of or references to dollar amounts in this agreement shall mean lawful money of Canada. Whenever it is provided herein that an amount shall be expressed in Canadian dollars but such amount is denominated in United States dollars, such amount shall be expressed as the Canadian Dollar Equivalent of the amount denominated in United States dollars.
 
1.6	Applicable Law.	
This agreement shall be governed by and construed and interpreted in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein.
 
1.7	Time of the Essence.	
Time shall in all respects be of the essence of this agreement.
 
1.8	Non-Banking Days.	
Subject to Section 7.5(c), whenever any payment to be made hereunder shall be stated to be due or any action to be taken hereunder shall be stated to be required to be taken on a day other than a Banking Day, such payment shall be made or such action shall be taken on the next succeeding Banking Day and, in the case of the payment of any amount, the extension of time shall be included for the purposes of computation of interest, if any, thereon.
 
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1.9	Consents and Approvals.	
Whenever the consent or approval of a party hereto is required in a particular circumstance, unless otherwise expressly provided for herein, such consent or approval shall not be unreasonably withheld or delayed by such party .
 
1.10	Amount of Credit.	
Any reference herein to the amount of credit outstanding under the Credit Facilities shall mean, at any particular time:
 
 	(a)	in the case of a Prime Rate Loan or a BA Equivalent Loan, the principal amount thereof;	
 
 	(b)	in the case of a Bankers’ Acceptance, the face amount of the Bankers’ Acceptance;	
 
 	(c)	in the case of a LIBOR Loan or a Base Rate Canada Loan, the Canadian Dollar Equivalent of the principal amount thereof;	
 
 	(d)	in the case of a Letter denominated in Canadian dollars, the contingent liability of the relevant Issuing Lender thereunder; and	
 
 	(e)	in the case of a Letter denominated in United States dollars, the Canadian Dollar Equivalent of the contingent liability of the relevant Issuing Lender thereunder.	
 
1.11	Schedules.	
Each and every one of the schedules which is referred to in this agreement and attached to this agreement shall form a part of this agreement.
 
1.12	Paramountcy.	
In the event of any conflict or inconsistency between the provisions of this agreement and the provisions of any other Loan Document, the provisions of this agreement shall prevail and be paramount. If any covenant, representation, warranty or event of default contained in any other Loan Document is in conflict with or is inconsistent with a provision of this agreement relating to the same specific matter, such covenant, representation, warranty or event of default shall be deemed to be amended to the extent necessary to ensure that it is not in conflict with or inconsistent with the provision of this agreement relating to the same specific matter.
 
1.13	Extension of Credit.	
For the purposes hereof, each drawdown, rollover and conversion shall be deemed to be an extension of credit hereunder.
 
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1.14	Documents in English.	
The parties expressly request that this agreement as well as all documents relating thereto be drawn up in English. Les parties ont expressément exigé que cette convention de prêt ainsi que tous les documents s’y rattachant soient rédigés en anglais.
 
1.15	Statute References.	
Any reference in this agreement to any statute or any section thereof shall, unless otherwise expressly stated, be deemed to be a reference to such statute or section as amended, restated or re-enacted from time to time.
 
1.16	Calculations, Computations.	
All computations and calculations determining compliance with financial covenants or the calculation or computation of other financial information for the purposes of this agreement shall be made and prepared in accordance with generally accepted accounting principles consistently applied throughout the periods involved on an Adjusted Consolidated Basis. All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles in conformity with those used in the preparation of the Financial Statements. Subject to Section 1.21, any change in the Borrowing Group’s accounting treatment for the purposes of Section 11.1(f) or 11.1(g) shall only be done in accordance with generally accepted accounting principles and, in such event, the Majority Lenders shall have the right (if such change results in a material change to the ratios calculated under Section 11.1(f) or 11.1(g)), acting reasonably, to restructure Section 11.1(f) or 11.1(g) in a manner which eliminates the effect of any such change; provided that any such restructuring shall afford the Borrowing Group the same degree of operational flexibility as do the current Sections.
 
1.17	Successors and Permitted Assigns of Parties.	
Any reference in this agreement to a party to this agreement shall include the successors and permitted assigns of such party.
 
1.18	Meaning of Include.	
The words “include”, “includes” and “including”, when used in this agreement, shall be deemed to be followed by the phrase “without limitation”.
 
1.19	Rule of Construction.	
The Loan Documents have been negotiated by each party hereto or thereto with the benefit of legal representation, and any rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not apply to the construction or interpretation of the Loan Documents.
 
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1.20	Relevant Lenders.	
For the purposes hereof, the relevant Lenders in respect of a particular Credit Facility shall be the Lenders who have an Individual Commitment with respect to such Credit Facility.
 
1.21	Change in Accounting Policies.	
Whereas the Borrowing Group may adopt new accounting policies from time to time, whereby such adoption is compelled by accounting or regulatory bodies having jurisdiction or at its own discretion, and whereas these accounting changes may result in a material change in the calculation of the financial covenants or financial covenant thresholds or terms used in this agreement or any other Loan Document, then the Borrowers, the Administrative Agent and the Lenders agree to enter into good faith negotiations in order to amend such provisions of this agreement or such Loan Document, as applicable, so as to equitably reflect such accounting changes with the desired result that the criteria for evaluating the Borrowing Group’s financial condition, financial covenants, financial covenant thresholds or terms used in this agreement or any other Loan Document shall be the same after such accounting changes as if such accounting changes had not been made; provided, however, that the agreement of the Majority Lenders to any required amendments of such provisions shall be sufficient to bind all Lenders. If Anixter Canada and the Majority Lenders cannot agree upon the required amendments prior to the date of implementation of any accounting policy change, then all calculations of financial covenants, financial covenant thresholds or terms used in this agreement or any other Loan Document shall be prepared and delivered without reflecting the accounting policy change.
 
1.22	Joint and Several Obligations.	
 
 	(a)	All obligations hereunder which are stated to be obligations of the Borrowers or any one of them to the Credit Parties shall be joint and several obligations of the Borrowers. The obligation of any Borrower with respect to its joint and several liability for the credit extended to any of the other Borrowers shall not be wholly or partially satisfied by such first mentioned Borrower repaying the credit extended to such first mentioned Borrower hereunder. The Lenders shall not be bound to exhaust their recourse against any Borrower or others or any security or guarantees they may at any time hold before being entitled to payment from any of the other Borrowers and each of the Borrowers renounces all benefits of discussion and division.	
 
 	(b)	In addition to all such rights of indemnity and subrogation as the Borrowers may have under applicable law, in the event a payment shall be made by any Borrower (the “ Claiming Borrower ”) in respect of credit extended to another of the Borrowers (the “ Borrowing Borrower ”) as a result of the Claiming Borrower’s joint and several liability hereunder, the Borrowing Borrower shall indemnify such Claiming Borrower for the full amount of such payment and, subject to clause (c) below, such Claiming Borrower shall be subrogated to the rights of the person to whom such payment shall have been made to the extent of such payment.	
 
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 	(c)	None of the Borrowers shall exercise any rights which it may acquire by way of indemnity, subrogation or contribution by reason of its joint and several liability hereunder, by any payment made hereunder or otherwise, until the Finance Obligations Termination Date. Any amount paid to a Borrower on account of any such rights prior to the Finance Obligations Termination Date shall be held in trust for the benefit of the Credit Parties and shall immediately be paid to the Credit Parties, and credited and applied against outstanding credit hereunder, whether matured or unmatured, in accordance with the terms hereof.	
 
1.23	Dutch Terms	
In this Agreement, where it relates to a Dutch entity, a reference to:
 
 	(a)	a necessary action to authorise, where applicable, includes without limitation:	
 
 	(i)	any action required to comply with the Dutch Works Council Act ( Wet op de ondernemingsraden ); and	
 
 	(ii)	obtaining unconditional positive advice ( advies ) from each competent works council;	
 
 	(b)	a winding-up, administration or dissolution includes a Dutch entity being:	
 
 	(i)	declared bankrupt ( failliet verklaard );	
 
 	(ii)	dissolved ( ontbonden );	
 
 	(c)	a moratorium includes surseance van betaling and granted a moratorium includes surseance verleend ;	
 
 	(d)	a liquidator includes a curator ;	
 
 	(e)	an administrator includes a bewindvoerder ;	
 
 	(f)	a receiver or an administrative receiver does not include a curator or bewindvoerder ; and	
 
 	(g)	an attachment includes a beslag .	
ARTICLE 2
CREDIT FACILITIES
 
2.1	Establishment of Credit Facilities.	
Subject to the terms and conditions hereof, the relevant Lenders hereby establish:
 
 	(a)	in favour of the Borrowers a revolving term credit facility (the “ RT Facility ”) in the aggregate amount of the RT Credit Limit; and	
 
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 	(b)	in favour of Anixter Canada a non-revolving term credit facility (the “ NRT Facility ”) in the aggregate amount of the NRT Credit Limit.	
 
2.2	Credit Restrictions.	
Subject to the terms and conditions hereof, the aggregate amount of credit outstanding under the RT Facility shall not at any time exceed the RT Credit Limit. At no time shall the aggregate amount of credit outstanding under the NRT Facility exceed the NRT Credit Limit other than any such excess that results solely from currency fluctuations. Any extension of credit hereunder by way of Prime Rate Loans (other than Prime Rate Loans made pursuant to the Swingline Availability) shall be in a minimum amount of $1,000,000 and in integral multiples of $100,000 in excess thereof. Any extension of credit hereunder by way of Base Rate Canada Loans (other than Base Rate Canada Loans made pursuant to the Swingline Availability) shall be in a minimum amount of U.S.$1,000,000 and in integral multiples of U.S.$100,000 in excess thereof. Any extension of credit hereunder by way of Bankers’ Acceptances shall be in a minimum amount of $1,000,000 and in integral multiples of $1,000 in excess thereof. Any extension of credit hereunder by way of LIBOR Loans shall be in a minimum amount of U.S.$1,000,000 and in integral multiples of U.S.$100,000 in excess thereof.
 
2.3	Lenders’ Commitments.	
Subject to the terms and conditions hereof, the relevant Lenders severally agree to extend credit to the Borrowers under the relevant Credit Facility from time to time provided that the aggregate amount of credit extended by each relevant Lender under a particular Credit Facility shall not at any time exceed the Individual Commitment of such Lender with respect to such Credit Facility and further provided that the aggregate amount of credit outstanding under a particular Credit Facility shall not at any time exceed the relevant Credit Limit. All credit requested under a particular Credit Facility shall be made available to the applicable Borrower contemporaneously by all of the Lenders with an Individual Commitment with respect to such Credit Facility. Each relevant Lender shall provide to the Administrative Agent its Pro Rata Share of each credit, whether such credit is extended by way of drawdown, rollover or conversion. No Lender shall be responsible for any default by any other Lender in its obligation to provide its Pro Rata Share of any credit nor shall the Individual Commitment of any Lender with respect to a Credit Facility be increased as a result of any such default of another Lender in extending credit under such Credit Facility. The failure of any Lender to make available to a Borrower its Pro Rata Share of any credit shall not relieve any other Lender of its obligation hereunder to make available to the applicable Borrower its Pro Rata Share of the credit.
 
2.4	Reduction of Credit Limits.	
The Borrowers may, from time to time and at any time, by notice in writing to the Administrative Agent, permanently reduce the RT Credit Limit to the extent it is not being utilized. The amount of the RT Credit Limit will not be permanently reduced by any prepayment or repayment under the RT Facility pursuant to Section 9.2 or 9.8 but will be reduced at the time of and by the amount of any prepayment or repayment of the RT Facility pursuant to Section 9.1. The amount of the NRT Credit Limit will be permanently reduced at the time of and by the amount of any prepayment or repayment under the NRT Facility pursuant to Section 9.1, 9.2, 9.3
 
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or 9.8. The amount of the NRT Credit Limit will be permanently reduced to an amount equal to the amount of the single drawdown under the NRT Facility on the relevant date of such drawdown. Any repayment of outstanding credit which forms part of any conversion from one type of credit to another type of credit under Article 6 shall not cause any reduction in the amount of the relevant Credit Limit. Upon any reduction of a Credit Limit, the Individual Commitment of each Lender with respect to the relevant Credit Facility shall thereupon be reduced by an amount equal to such Lender’s Pro Rata Share of the amount of such reduction of such Credit Limit.
 
2.5	Termination of Credit Facilities.	
A Credit Facility shall terminate upon the earliest to occur of:
 
 	(a)	the Maturity Date;	
 
 	(b)	the termination of such Credit Facility in accordance with Section 13.1;	
 
 	(c)	the date on which, pursuant to Section 2.4, the relevant Credit Limit has been permanently reduced to zero; and	
 
 	(d)	in the case of the NRT Facility only, January 15, 2016, if the sole permitted drawdown under the NRT Facility has not occurred on or before such date.	
Upon the termination of a Credit Facility, the right of the Borrower(s) to obtain any credit under such Credit Facility and all of the obligations of the Lenders to extend credit under such Credit Facility shall automatically terminate.
ARTICLE 3
GENERAL PROVISIONS RELATING TO CREDITS
 
3.1	Types of Credit Availments.	
Subject to the terms and conditions hereof, a Borrower may obtain credit under a particular Credit Facility as follows:
 
 	(a)	the Borrowers may obtain credit under the RT Facility by way of one or more of the following:	
 
 	(i)	Prime Rate Loans, Base Rate Canada Loans, LIBOR Loans, Bankers’ Acceptances, BA Equivalent Loans and Letters; and/or	
 
 	(ii)	by incurring overdrafts at any particular time in an aggregate amount not exceeding the Available RT Credit at such time (“ Swingline Availability ”) in their Canadian dollar and U.S. dollar accounts with the Swingline Lender, which overdrafts shall be deemed to be, as applicable, Prime Rate Loans or Base Rate Canada Loans;	
 
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 	(b)	Anixter Canada may obtain credit under the NRT Facility by way of one or more Prime Rate Base Rate Canada Loans, LIBOR Loans, Bankers’ Acceptances and BA Equivalent Loans.	
 
3.2	Funding of Loans.	
Each relevant Lender shall make available to the Administrative Agent at the Branch of Account its Pro Rata Share of the principal amount of each Loan under the relevant Credit Facility to a relevant Borrower prior to 1:00 p.m. (Toronto time) on the date of the extension of credit. The Administrative Agent shall, upon fulfilment by the relevant Borrower of the terms and conditions set forth in Article 12, make such funds available to the applicable Borrower by 3:00 p.m. (Toronto time) on the date of the extension of credit by crediting the relevant Designated Account. Unless the Administrative Agent has been notified by a Lender at least one Banking Day prior to the date of the extension of credit that such Lender will not make available to the Administrative Agent its Pro Rata Share of such Loan, the Administrative Agent may assume that such Lender has made such portion of the Loan available to the Administrative Agent on the date of the extension of credit in accordance with the provisions hereof and the Administrative Agent may, in reliance upon such assumption, make available to the applicable Borrower on such date a corresponding amount. If the Administrative Agent has made such assumption, to the extent such Lender shall not have so made its Pro Rata Share of the Loan available to the Administrative Agent, such Lender agrees to pay to the Administrative Agent, forthwith on demand, such Lender’s Pro Rata Share of the Loan and all reasonable costs and expenses incurred by the Administrative Agent in connection therewith together with interest thereon at the then prevailing interbank rate for each day from the date such amount is made available to the applicable Borrower until the date such amount is paid or repaid to the Administrative Agent; provided, however, that notwithstanding such obligation, if such Lender fails so to pay, the applicable Borrower shall, without prejudice to any rights that such Borrower might have against such Lender, repay such amount to the Administrative Agent forthwith after demand therefor by the Administrative Agent. The amount payable by each Lender to the Administrative Agent pursuant hereto shall be set forth in a certificate delivered by the Administrative Agent to such Lender and the applicable Borrower (which certificate shall contain reasonable details of how the amount payable is calculated) and shall constitute prima facie evidence of such amount payable. If such Lender makes the payment to the Administrative Agent required herein, the amount so paid shall constitute such Lender’s Pro Rata Share of the Loan for purposes of this agreement and shall entitle the relevant Lender to all rights and remedies against the applicable Borrower in respect of such Loan.
 
3.3	Failure of Lender to Fund Loan.	
If any Defaulting Lender fails to make available to the Administrative Agent its Pro Rata Share of any Loan as required and the Administrative Agent has not funded pursuant to Section 3.2, the Administrative Agent shall forthwith give notice of such failure by the Defaulting Lender to the applicable Borrower and the other relevant Lenders and such notice shall state that any relevant Lender may make available to the Administrative Agent all or any portion of the Defaulting Lender’s Pro Rata Share of such Loan (but in no way shall any other Lender or the Administrative Agent be obliged to do so) in the place and stead of the Defaulting Lender. If more than one relevant Lender gives notice that it is prepared to make funds available
 
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in the place and stead of a Defaulting Lender in such circumstances and the aggregate of the funds which such Lenders (herein collectively called the “ Contributing Lenders ” and individually called the “ Contributing Lender ”) are prepared to make available exceeds the amount of the advance which the Defaulting Lender failed to make, then each Contributing Lender shall be deemed to have given notice that it is prepared to make available its pro rata share of such advance based on the Contributing Lenders’ relative commitments to advance in such circumstances. If any Contributing Lender makes funds available in the place and stead of a Defaulting Lender in such circumstances, then the Defaulting Lender shall pay to any Contributing Lender making the funds available in its place and stead, forthwith on demand, any amount advanced on its behalf together with interest thereon at the then prevailing interbank rate for each day from the date of advance to the date of payment, against payment by the Contributing Lender making the funds available of all interest received in respect of the Loan from the applicable Borrower. In addition to interest as aforesaid, the applicable Borrower shall pay all amounts owing by such Borrower to the Defaulting Lender hereunder (with respect to the amounts advanced by the Contributing Lenders on behalf of the Defaulting Lender) to the Contributing Lenders until such time as the Defaulting Lender pays to the Administrative Agent for the Contributing Lenders all amounts advanced by the Contributing Lenders on behalf of the Defaulting Lender. For purposes of this agreement, “ the then prevailing interbank rate ” means,
 
 	(i)	if the relevant availment is denominated in U.S. dollars, the Federal Funds Effective Rate; and	
 
 	(ii)	if the relevant availment is denominated in Canadian dollars, the BA Schedule I Rate for Bankers’ Acceptances having a term of one month.	
 
3.4	Funding of Bankers’ Acceptances.	
 
 	(a)	If the Administrative Agent receives a Drawdown Notice, Rollover Notice or Conversion Notice requesting a drawdown of, a rollover of or a conversion into Bankers’ Acceptances, the Administrative Agent shall notify each of the relevant Lenders, prior to 1:00 p.m. (Toronto time) on the second Banking Day prior to the date of such extension of credit, of such request and of each relevant Lender’s Pro Rata Share of such extension of credit. The Administrative Agent shall also at such time notify the applicable Borrower of each relevant Lender’s Pro Rata Share of such extension of credit. Subject to Section 3.5, each relevant Lender shall, not later than 1:00 p.m. (Toronto time) on the date of each extension of credit by way of Bankers’ Acceptance, accept drafts of the applicable Borrower which are presented to it for acceptance and which have an aggregate face amount equal to such Lender’s Pro Rata Share of the total extension of credit being made available by way of Bankers’ Acceptances on such date, as advised by the Administrative Agent. Each Lender shall purchase the Bankers’ Acceptances which it has accepted for a purchase price equal to the BA Discounted Proceeds therefor. Each Lender may at any time and from time to time hold, sell, rediscount or otherwise dispose of any and all Bankers’ Acceptances accepted and purchased by it.	
 
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 	(b)	Each Borrower hereby waives presentment for payment of Bankers’ Acceptances by the Lenders and any defence to payment of amounts due to a Lender in respect of a Bankers’ Acceptance which might exist by reason of such Bankers’ Acceptance being held at maturity by the Lender which accepted it and agrees not to claim from such Lenders any days of grace for the payment at maturity of Bankers’ Acceptances.	
 
 	(c)	In the case of a drawdown by way of Bankers’ Acceptance, each relevant Lender shall, forthwith after the acceptance of drafts of the applicable Borrower as aforesaid, make available to the Administrative Agent the BA Proceeds with respect to the Bankers’ Acceptances accepted by it. The Administrative Agent shall, upon fulfilment by the applicable Borrower of the terms and conditions set forth in Article 12, make such BA Proceeds available to such Borrower on the date of such extension of credit by crediting the relevant Designated Account. In the case of a rollover of or conversion into Bankers’ Acceptances, each relevant Lender shall retain the proceeds of the Bankers’ Acceptance accepted by it and shall not be required to make any funds available to the Administrative Agent for deposit to the relevant Designated Account; however, forthwith after the acceptance of drafts of the applicable Borrower as aforesaid, such Borrower shall pay to the Administrative Agent on behalf of the relevant Lenders an amount equal to the aggregate amount of the acceptance fees in respect of such Bankers’ Acceptances calculated in accordance with Section 7.6 plus the amount by which the aggregate face amount of such Bankers’ Acceptances exceeds the aggregate BA Discounted Proceeds with respect thereto.	
 
 	(d)	Any Bankers’ Acceptance may, at the option of the applicable Borrower, be executed in advance by or on behalf of such Borrower (as otherwise provided herein), by mechanically reproduced or facsimile signatures of any officers of such Borrower who are properly so designated and authorized by such Borrower from time to time. Any Bankers’ Acceptance so executed and delivered by such Borrower to the relevant Lenders shall be valid and shall bind such Borrower and may be dealt with by the relevant Lenders to all intents and purposes as if the Bankers’ Acceptance had been signed in the executing officers’ own handwriting.	
 
 	(e)	The applicable Borrower shall notify the Lenders as to those officers of such Borrower whose signatures may be reproduced and used to execute Bankers’ Acceptances in the manner provided in Section 3.4(d). Bankers’ Acceptances with the mechanically reproduced or facsimile signatures of designated officers may be used by the Lenders and shall continue to be valid, notwithstanding the death, termination of employment or termination of authorization of either or both of such officers or any other circumstance.	
 
 	(f)	Each Borrower hereby indemnifies and agrees to hold harmless the Lenders against and from all losses, damages, expenses and other liabilities caused by or attributable to the use of the mechanically reproduced or facsimile signature instead of the original signature of an authorized officer of such Borrower on a Banker’s Acceptance prepared, executed, issued and accepted pursuant to this agreement, except to the extent determined by a court of competent jurisdiction to be due to the gross negligence or wilful misconduct of the Lenders.	
 
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 	(g)	Each of the Lenders agrees that, in respect of the safekeeping of executed drafts of the Borrowers which are delivered to it for acceptance hereunder, it shall exercise the same degree of care which it gives to its own property, provided that it shall not be deemed to be an insurer thereof.	
 
 	(h)	All Bankers’ Acceptances to be accepted by a particular Lender shall, at the option of such Lender, be issued in the form of depository bills made payable originally to and deposited with CDS Clearing and Depository Services Inc. (or other recognized clearing house) pursuant to the Depository Bills and Notes Act (Canada).	
 
 	(i)	In order to facilitate the issuance of Bankers’ Acceptances pursuant to this agreement, each Borrower hereby authorizes each Lender, and appoints each Lender as such Borrower’s attorney, to complete, sign and endorse drafts or depository bills (each such executed draft or bill being herein referred to as a “ BA Draft ”) on its behalf in handwritten form or by facsimile or mechanical signature or otherwise in accordance with the applicable Drawdown Notice, Rollover Notice or Conversion Notice and, once so completed, signed and endorsed to accept them as Bankers’ Acceptances under this agreement and then if applicable, purchase, discount or negotiate such Bankers’ Acceptances in accordance with the provisions of this agreement. BA Drafts so completed, signed, endorsed and negotiated on behalf of the applicable Borrower by such Lender shall bind such Borrower as fully and effectively as if so performed by an authorized officer of such Borrower. Each draft of a Bankers’ Acceptance completed, signed or endorsed by a Lender shall mature on the last day of the term thereof.	
 
 	(j)	If at any time on or prior to the proposed first day of the term of a proposed issue of Bankers’ Acceptances the Administrative Agent determines (which determination shall be made acting reasonably and in good faith, but shall be conclusive and bind the applicable Borrower) that:	
 
 	(i)	the issuance or discount of any Bankers’ Acceptances for the proposed term thereof has been made impossible or impracticable by reason of the occurrence of any event affecting the Canadian money markets or any national or international financial, political, terrorist or economic event; or	
 
 	(ii)	there does not exist a normal money market in Canada for the purchase and sale of bankers’ acceptances or such money market has been disrupted by the occurrence of an extraordinary event or an act of terrorism,	
(a “ BA Disruption Event ”) then the Administrative Agent will promptly notify the applicable Borrower and each Lender of such determination. Thereafter, and until the Administrative Agent notifies the applicable Borrower and the Lenders that the BA Disruption Event no longer exists or applies, the right of such
 
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Borrower to request an extension of credit by way of Bankers’ Acceptances shall be suspended and any Drawdown Notice, Rollover Notice or Conversion Notice given by such Borrower with respect to any proposed issue of Bankers’ Acceptances that has not yet been made shall be deemed to be replaced by a Drawdown Notice, Rollover Notice or Conversion Notice for a Prime Rate Loan in the same amount as the requested issue of Bankers’ Acceptances.
 
3.5	BA Equivalent Loans.	
If, in the sole judgement of a Lender, such Lender is unable to extend credit by way of Bankers’ Acceptances in accordance with this agreement, such Lender shall give an irrevocable notice to such effect to the Administrative Agent and the applicable Borrower prior to 12:00 p.m. (Toronto time) on the date of the requested credit extension and shall make available to such Borrower prior to 1:00 p.m. (Toronto time) on the date of such requested credit extension a Canadian dollar loan (a “ BA Equivalent Loan ”) in the principal amount equal to such Lender’s Pro Rata Share of the total credit to be extended by way of Bankers’ Acceptances, such BA Equivalent Loan to be funded in the same manner as a Loan is funded pursuant to Sections 3.2 and 3.3. Such BA Equivalent Loan shall have the same term as the Bankers’ Acceptances for which it is a substitute and shall bear such rate of interest per annum throughout the term thereof as shall permit such Lender to obtain the same effective rate as if such Lender had accepted and purchased a Bankers’ Acceptance at the same acceptance fee and pricing at which such Lender would have accepted and purchased such Bankers’ Acceptance at approximately 1:00 p.m. (Toronto time) on the date such BA Equivalent Loan is made, on the basis that, and each Borrower hereby agrees that, for such a BA Equivalent Loan, interest shall be payable in advance on the date of the extension of credit by the Lender deducting the interest payable in respect thereof from the principal amount of such BA Equivalent Loan. All BA Equivalent Loans to be made by a particular Lender shall, at the option of such Lender, be evidenced by a promissory note in the form of a depository note made payable originally to and deposited with The Canadian Depository for Securities Limited pursuant to the Depository Bills and Notes Act (Canada).
 
3.6	Inability to Fund U.S. Dollar Advances in Canada.	
If a Lender determines in good faith, which determination shall be final, conclusive and binding on the applicable Borrower, and the Administrative Agent notifies such Borrower that (i) by reason of circumstances affecting financial markets inside or outside Canada, deposits of United States dollars are unavailable to such Lender in Canada, (ii) adequate and fair means do not exist for ascertaining the applicable interest rate on the basis provided in the definition of LIBOR or Alternate Base Rate Canada, as the case may be, (iii) the making or continuation of United States dollar advances in Canada has been made impracticable by the occurrence of a contingency which materially and adversely affects the funding of the advances at any interest rate computed on the basis of LIBOR or the Alternate Base Rate Canada, as the case may be, or by reason of a change since the date hereof in any applicable law or government regulation, guideline or order (whether or not having the force of law but, if not having the force of law, one with which a responsible Canadian chartered bank would comply) or in the interpretation thereof by any Official Body affecting such Lender or any relevant financial market, which results in LIBOR or the Alternate Base Rate Canada, as the case may be, no
 
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longer representing the effective cost to such Lender of deposits in such market for a relevant Interest Period, or (iv) any change to present law or any future law, regulation, order, treaty or official directive (whether or not having the force of law but, if not having the force of law, one with which a responsible Canadian chartered bank would comply) or any change therein or any interpretation or application thereof by any Official Body has made it unlawful for such Lender to make or maintain or give effect to its obligations in respect of United States dollar advances in Canada as contemplated herein, then
 
 	(a)	the right of the applicable Borrower to obtain any credit in United States dollars by way of Base Rate Canada Loans or LIBOR Loans, as applicable, shall be suspended until such Lender determines, acting reasonably, that the circumstances causing such suspension no longer exist and such Lender so notifies such Borrower;	
 
 	(b)	if any credit in United States dollars by way of Base Rate Canada Loans or LIBOR Loans, as applicable, is not yet outstanding, any applicable Drawdown Notice shall be cancelled and the advance requested therein shall not be made;	
 
 	(c)	if any LIBOR Loan is already outstanding at any time when the right of such Borrower to obtain credit by way of a LIBOR Loan is suspended, it shall, subject to such Borrower having the right to obtain credit by way of a Base Rate Canada Loan at such time, be converted to a Base Rate Canada Loan on the last day of the Interest Period applicable thereto (or on such earlier date as may be required to comply with any applicable law) or, if such Borrower does not have the right to obtain credit by way of a Base Rate Canada Loan at such time, such LIBOR Loan shall be converted to a Prime Rate Loan on the last day of the Interest Period applicable thereto (or on such earlier date as may be required to comply with any applicable law) in the principal amount equal to the Canadian Dollar Equivalent of the principal amount of such LIBOR Loan; and	
 
 	(d)	if any Base Rate Canada Loan is already outstanding at any time when the right of the applicable Borrower to obtain credit by way of a Base Rate Canada Loan is suspended, it shall, subject to such Borrower having the right to obtain credit by way of a LIBOR Loan at such time, be immediately converted to a LIBOR Loan in the principal amount equal to the principal amount of the Base Rate Canada Loan and having an Interest Period of one month or, if such Borrower does not have the right to obtain credit by way of a LIBOR Loan at such time, it shall be immediately converted to a Prime Rate Loan in the principal amount equal to the Canadian Dollar Equivalent of the principal amount of the Base Rate Canada Loan.	
In the event that any of the events listed above results in a limitation of the amount of loans made by such Lender which can bear interest at the applicable LIBOR or the Alternate Base Rate Canada, as the case may be, or the amount of United States dollar advances which such Lender can make in Canada, such Lender agrees to use good faith to allocate, in reasonable fashion, the available amounts amongst its borrowers as is reasonably practicable.
 
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3.7	Timing of Credit Availments.	
No Bankers’ Acceptance, BA Equivalent Loan or LIBOR Loan may have a maturity date later than the Maturity Date. Each Letter shall have a term that is not more than one year after its issuance date or renewal date (which may extend beyond the then-current Maturity Date), but may provide for automatic renewal of its term for successive periods of up to one year each as long as the Issuing Lender has the right to avoid automatic renewal by giving notice to the beneficiary of the Letter before the extension becomes effective. On the cancellation of the RT Facility, the Borrowers shall arrange for all outstanding Letters to be returned to the Issuing Bank for cancellation or provide Cash to the Issuing Bank in an amount sufficient to fully secure all outstanding Letters and all fees relating to Letters for the remainder of their respective terms, in which case the Cash shall be held by the Issuing Bank in place of the Security.
 
3.8	Time, Place and Source of Payments.	
Unless otherwise expressly provided herein, the Borrowers shall make all payments pursuant to this agreement or pursuant to any document, instrument or agreement delivered pursuant hereto by deposit by or on behalf of the Borrowers to the relevant Designated Account before 12:00 noon (Toronto time) on the day specified for payment and the Administrative Agent or its designee shall be entitled to withdraw the amount of any payment due to the Administrative Agent or the Lenders hereunder from such accounts on the day specified for payment. Any such payment received on the day specified for such payment but after 12:00 noon (Toronto time) shall be deemed to have been received prior to 12:00 noon (Toronto time) on the Banking Day immediately following such day specified for payment.
 
3.9	Remittance of Payments.	
Forthwith after the withdrawal from the relevant Designated Account by the Administrative Agent or its designee of any payment of principal, interest, fees or other amounts for the benefit of the relevant Lenders pursuant to Section 3.8, the Administrative Agent shall, subject to Sections 3.3, 8.2 and 14.22 remit to each relevant Lender, in immediately available funds, such Lender’s Pro Rata Share of such payment (except to the extent such payment results from a Loan with respect to which a Lender had failed, pursuant to Section 3.2, to make available to the Administrative Agent its Pro Rata Share and, where any other Lender has made funds available in the place and stead of a Defaulting Lender); provided that if the Administrative Agent, on the assumption that it will receive, on any particular date, a payment of principal (including, without limitation, a prepayment), interest, fees or other amount under a particular Credit Facility, remits to each relevant Lender its Pro Rata Share of such payment and the applicable Borrower fails to make such payment, each of the relevant Lenders agrees to repay to the Administrative Agent, forthwith on demand, to the extent that such amount is not recovered from the applicable Borrower on demand and after reasonable efforts by the Administrative Agent to collect such amount (without in any way obligating the Administrative Agent to take any legal action with respect to such collection), such Lender’s Pro Rata Share of the payment made to it pursuant hereto together with interest thereon at the then prevailing interbank rate for each day from the date such amount is remitted to the relevant Lenders until the date such amount is paid or repaid to the Administrative Agent, the exact amount of the
 
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repayment required to be made by the relevant Lenders pursuant hereto to be as set forth in a certificate delivered by the Administrative Agent to each relevant Lender, which certificate shall constitute prima facie evidence of such amount of repayment.
 
3.10	Evidence of Indebtedness.	
The Administrative Agent shall open and maintain accounts wherein the Administrative Agent shall record the amount of credit outstanding, each payment of principal and interest on account of each Loan, each Bankers’ Acceptance accepted and cancelled, each Letter issued and drawn upon and all other amounts becoming due to and being paid to the Lenders or the Administrative Agent hereunder. As against the Borrowers but not the Lenders, the Administrative Agent’s accounts constitute, in the absence of manifest error, prima facie evidence of the indebtedness of the Borrowers pursuant to this agreement.
 
3.11	General Provisions Relating to Letters.	
 
 	(a)	Each Borrower shall indemnify and save harmless the relevant Lenders, the Issuing Lenders and the Administrative Agent (except to the extent caused by the gross negligence or wilful misconduct of any of the relevant Lenders, the Issuing Lenders or the Administrative Agent) against all claims, losses, costs, expenses or damages to the relevant Lenders, the Issuing Lenders and the Administrative Agent arising out of or in connection with any Letter, the issuance thereof, any payment thereunder or any action taken by the relevant Lenders, the Issuing Lenders or the Administrative Agent or any other Person in connection therewith, including, without limitation, all costs relating to any legal process or proceeding instituted by any party restraining or seeking to restrain any Issuing Lender from accepting or paying any Draft or any amount under any such Letter.	
 
 	(b)	Each Borrower hereby acknowledges and confirms to each Issuing Lender that such Issuing Lender shall not be obliged to make any inquiry or investigation as to the right of any beneficiary to make any claim or Draft or request any payment under a Letter issued by such Issuing Lender and payment by such Issuing Lender pursuant to a Letter shall not be withheld by such Issuing Lender by reason of any matters in dispute between the beneficiary thereof and such Borrower. The sole obligation of any Issuing Lender with respect to Letters issued by such Issuing Lender is to cause to be paid a Draft drawn or purporting to be drawn in accordance with the terms of the applicable Letter and for such purpose such Issuing Lender is only obliged to determine that the Draft purports to comply with the terms and conditions of the relevant Letter.	
 
 	(c)	No Issuing Lender shall have any responsibility or liability for or any duty to inquire into the form, sufficiency (other than to the extent provided in the preceding paragraph), authorization, execution, signature, endorsement, correctness (other than to the extent provided in the preceding paragraph), genuineness or legal effect of any Draft, certificate or other document presented to it pursuant to a Letter and each Borrower unconditionally assumes all risks with respect to the same. Each Borrower agrees that it assumes all risks of the acts or omissions of the beneficiary of any Letter with respect to the use by such beneficiary of the relevant Letter.	
 
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 	(d)	The obligations of each Borrower hereunder with respect to Letters shall be absolute, unconditional and irrevocable and shall not be reduced by any event or occurrence including, without limitation:	
 
 	(i)	any lack of validity or enforceability of this agreement or any such Letter;	
 
 	(ii)	any amendment or waiver of or any consent to departure from this agreement;	
 
 	(iii)	the existence of any claim, set-off, defence or other rights which such Borrower may have at any time against any beneficiary or any transferee of any such Letter (or any person or entities for whom any such beneficiary or any such transferee may be acting), any Lender, any Issuing Lender or any other Person;	
 
 	(iv)	any Draft, statement or other document presented under any such Letter proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect whatsoever;	
 
 	(v)	any non-application or misapplication by the beneficiary of such Letter of the proceeds of any drawing under such Letter;	
 
 	(vi)	the surrender or impairment of any Security;	
 
 	(vii)	any reduction or withdrawal of any Issuing Lender’s credit rating by any rating agency; or	
 
 	(viii)	any other circumstance, happening or omission, whether or not similar to any of the foregoing.	
The obligations of each Borrower hereunder with respect to Letters shall remain in full force and effect and shall apply to any amendment to or extension of the expiration date of any such Letter.
 
 	(e)	Any action, inaction or omission taken or suffered by any Issuing Lender or any of such Issuing Lender’s correspondents under or in connection with a Letter issued by such Issuing Lender or any Draft made thereunder, if in good faith and in conformity with foreign or domestic laws, regulations or customs applicable thereto, shall be binding upon the relevant Borrower and shall not place such Issuing Lender or any of its correspondents under any resulting liability to such Borrower except in the case of such Issuing Lender’s gross negligence or wilful misconduct. Without limiting the generality of the foregoing, each Issuing Lender and its correspondents may receive, accept or pay as complying with the terms of a Letter issued by such Issuing Lender, any Draft thereunder, otherwise	
 
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 	in order which may be signed by, or issued to, the administrator or any executor of, or the trustee in bankruptcy of, or the receiver for any property of, or other person or entity acting as the representative or in the place of, such beneficiary or its successors and assigns. Each Borrower covenants that it will not take any steps, issue any instructions to any Issuing Lender or any of its correspondents or institute any proceedings intended to derogate from the right or ability of such Issuing Lender or its correspondents to honour and pay any Draft or Drafts.	
 
 	(f)	Each Borrower agrees that the Lenders, the Issuing Lenders and the Administrative Agent shall have no liability to it for any reason in respect of or in connection with any Letter, the issuance thereof, any payment thereunder, or any other action taken by the Lenders, the Issuing Lenders or the Administrative Agent or any other person in connection therewith, other than on account of any Issuing Lender’s gross negligence or wilful misconduct.	
 
 	(g)	Save to the extent expressly provided otherwise in this Section 3.11, the rights and obligations between the Issuing Bank and each Borrower with respect to each Letter shall be determined in accordance with the applicable provisions of the (i) Uniform Customs and Practice for Documentary Credits (2007 Revision), ICC Publications 600 or (ii) the International Standby Practices - ISP98, ICC Publication No. 590, as applicable.	
 
 	(h)	Notwithstanding any other provision hereof, no Issuing Lender shall be obligated to issue a Letter hereunder if, at the time of such issuance, any of the relevant Lenders is a Defaulting Lender unless either such Defaulting Lender or the Borrower has cash collateralized the reimbursement obligations of such Defaulting Lender to such Issuing Lender with respect to such Letter and all other Letters then outstanding to the satisfaction of such Issuing Lender.	
 
3.12	Notice Periods.	
Each Drawdown Notice, Rollover Notice, Conversion Notice and Prepayment Notice shall be given to the Administrative Agent:
 
 	(a)	prior to 11:00 a.m. (Toronto time) on the third Banking Day prior to the date of any voluntary prepayment pursuant to Section 9.2, any drawdown by way of issuance of a Letter or any drawdown of, rollover of, conversion into or conversion of a LIBOR Loan;	
 
 	(b)	prior to 11:00 a.m. (Toronto time) on the second Banking Day prior to the date of any drawdown, rollover of or conversion into or conversion of a Bankers’ Acceptance; and	
 
 	(c)	prior to 11:00 a.m. (Toronto time) on the first Banking Day prior to the date of any other drawdown, rollover or conversion.	
 
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3.13	Swingline Advances.	
 
 	(a)	At any time that the Swingline Lender is not the sole Lender with an Individual Commitment under the Swingline Availability, its participation in extensions of credit under the RT Facility which are not made under the Swingline Availability (“ Non Swingline Advances ”) shall be reduced, and the participations of the other relevant Lenders in such Non Swingline Advances shall be increased, and such participations may be adjusted from time to time, as determined by the Administrative Agent, so that each relevant Lender’s Pro Rata Share of the aggregate of all extensions of credit made under the RT Facility is, to the greatest extent practicable, as provided in Schedule A to this Agreement. For greater certainty, the aggregate of Advances outstanding under the Swingline Availability and Non Swingline Advances made by the Swingline Lender shall not at any time exceed The Bank of Nova Scotia’s Individual Commitment under the RT Facility, and if it does, the Borrowers shall repay the Credit Excess resulting therefrom in accordance with Section 9.8.	
 
 	(b)	Notwithstanding that extensions of credit under the Swingline Availability are from time to time made by the Swingline Lender and the Swingline Lender’s participation in Non Swingline Advances is reduced, and the participation of the other Lenders in Non Swingline Advances is increased in accordance with Section 3.13(a), it is the intention of the parties hereto that the ultimate credit risk and exposure of each relevant Lender in respect of the RT Facility be in accordance with its Pro Rata Share of the RT Facility Total Commitment Amount. Accordingly, upon the Obligations becoming due and payable under Section 9.1, each relevant Lender shall (and hereby absolutely, unconditionally and irrevocably agrees to) do all such things, including delivery of indemnity agreements and assignments to other relevant Lenders of extensions of credit to the Borrowers made by the Swingline Lender under the Swingline Availability or assignments to the Swingline Lender of Non Swingline Advances made by other relevant Lenders as shall be required to ensure that result. Any such action on the part of the relevant Lenders shall be binding on the Obligors. If any relevant Lender fails to take the actions required by this Section 3.13, the Administrative Agent may, without prejudice to the other rights of the relevant Lenders, make such adjustments to the payments to the defaulting relevant Lender under this Agreement as are necessary to compensate the other relevant Lenders for the defaulting Lender’s failure.	
 
 	(c)	Subject to the provisions of Section 3.13(b) regarding the assignment of interests in extensions of credit under the Swingline Availability in the event of acceleration of payment of the Obligations, the provisions of this Agreement do not apply to extensions of credit under the Swingline Availability to the extent that the provisions contemplate the participation by any relevant Lender other than the Swingline Lender in making extensions of credit under the RT Facility and receiving payments in respect of extensions of credit under the Swingline Availability. All extensions of credit under the Swingline Availability shall be made solely by the Swingline Lender and records concerning such extensions of	
 
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 	credit shall be maintained solely by the Swingline Lender. All payments of principal, interest, fees and other amounts relating to extensions of credit under the Swingline Availability shall be made solely to the Swingline Lender. Any notices by a Borrower in connection with the Swingline Availability shall be made to the Swingline Lender. The parties hereto agree that notice and minimum amount requirements in respect of extensions of credit under the RT Facility shall not apply to extensions of credit by way of overdraft under the Swingline Availability. Similarly, subject to any assignment of interests in extended credit under the Swingline Availability in the event of acceleration of payment of the Obligations as contemplated in Section 3.13(b), references in this Agreement to the relevant Lenders shall, in the context of the Swingline Availability, be interpreted as referring only to the Swingline Lender. No relevant Lender other than the Swingline Lender shall have any right to receive payments in respect of extensions of credit under the Swingline Availability or any obligations to make extensions of credit under the Swingline Availability.	
 
 	(d)	Extensions of credit under the Swingline Availability are available by way of overdraft only. Upon presentation to the Swingline Lender for payment of any cheque or other item drawn by a Borrower on any of its Canadian dollar or U.S. dollar current accounts at the Branch of Account which, when charged against the applicable account, creates or increases an overdraft in that account, the Swingline Lender shall pay the cheque or other item provided that, after doing so, the aggregate amount of the overdrafts outstanding in such accounts of the Borrower do not exceed the Available RT Credit (which overdrafts shall, in the case of the Borrowers’ Canadian dollar accounts, be deemed to be Prime Rate Loans, and, in the case of the Borrowers’ U.S. Dollar accounts, be deemed to be Base Rate Canada Loans). The Borrowers hereby request and authorize the Swingline Lender to make such Prime Rate Loans and Base Rate Canada Loans to cover such overdrafts, subject to the terms of this Agreement, and this standing authorization to the Administrative Agent shall be deemed for the purposes of this Agreement to constitute a Drawdown Notice on each date such extensions of credit are made by the Swingline Lender to cover any such overdraft. All of the provisions applicable to Prime Rate Loans and Base Rate Loans under this Agreement shall apply to extensions of credit under the Swingline Availability, respectively, other than minimum notice or minimum amount requirements.	
 
 	(e)	The aggregate principal amount of the Loans made under the Swingline Availability shall not exceed $25,000,000 or the U.S. Dollar Equivalent thereof.	
 
3.14	Administrative Agent’s Discretion to Allocate.	
Notwithstanding the provisions of Sections 3.2, 3.4 and 9.6 with respect to the funding of Loans and Bankers’ Acceptances and reimbursing with respect to Letters in accordance with each relevant Lender’s Pro Rata Share, the Administrative Agent shall be entitled to reallocate the funding or reimbursement obligations among the relevant Lenders in order to ensure, to the greatest extent practicable, that after such funding the aggregate amount of credit extended hereunder by each Lender coincides with such Lender’s Pro Rata Share of the
 
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aggregate amount of credit extended under the RT Facility by all of the relevant Lenders, provided that no such allocation shall result in the aggregate amount of credit extended under the RT Facility by any Lender exceeding such Lender’s Individual Commitment with respect to the RT Facility.
ARTICLE 4
DRAWDOWNS
 
4.1	Drawdown Notice.	
Subject to the terms and conditions hereof and provided that all of the applicable conditions precedent set forth in Article 12 have been fulfilled by the Borrowers or waived by the relevant Lenders in accordance with Section 14.14, any of the Borrowers may have credit extended to it under any Credit Facility from time to time by way of drawdown by giving to the Administrative Agent an irrevocable notice (“ Drawdown Notice ”) in accordance with Section 3.12, in substantially the form of Schedule D.
 
4.2	Drawdown Restriction.	
Anixter Canada may only obtain credit under the NRT Facility by means of a single drawdown thereunder on or before January 15, 2016.
ARTICLE 5
ROLLOVERS
 
5.1	Bankers’ Acceptances.	
Subject to the terms and conditions hereof and provided that a Borrower has, by giving notice to the Administrative Agent in accordance with Section 5.3, requested the relevant Lenders to accept drafts of such Borrower to replace all or a portion of outstanding Bankers’ Acceptances as they mature, each relevant Lender shall, on the maturity of such Bankers’ Acceptances, accept such Borrower’s draft or drafts having an aggregate face amount equal to its Pro Rata Share of the aggregate face amount of the matured Bankers’ Acceptances or the portion thereof to be replaced.
 
5.2	LIBOR Loans and BA Equivalent Loans.	
Subject to the terms and conditions hereof and provided that the applicable Borrower has, by giving notice to the Administrative Agent in accordance with Section 5.3, requested the relevant Lenders to continue to extend credit by way of LIBOR Loans or BA Equivalent Loans, as the case may be, to replace all or a portion of an outstanding LIBOR Loan or BA Equivalent Loan, as the case may be, as it matures, each relevant Lender shall, on the maturity of such LIBOR Loan or BA Equivalent Loan, as the case may be, continue to extend credit to such Borrower by way of a LIBOR Loan or BA Equivalent Loan, as the case may be, (without a further advance of funds to such Borrower) in the principal amount equal to such Lender’s Pro Rata Share of the principal amount of the matured LIBOR Loan or the matured BA Equivalent Loan, as the case may be. The provisions of Section 3.5 with respect to the payment of interest on a BA Equivalent Loan shall apply mutatis mutandis to any rollover of a BA Equivalent Loan pursuant to this Section 5.2.
 
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5.3	Rollover Notice.	
The notice to be given to the Administrative Agent pursuant to Section 5.1 or 5.2 (“ Rollover Notice ”) shall be irrevocable, shall be given in accordance with Section 3.12 and shall be substantially in the form of Schedule E hereto.
ARTICLE 6
CONVERSIONS
 
6.1	Converting Loan to Other Type of Loan.	
Subject to the terms and conditions hereof and provided that the applicable Borrower has, by giving notice to the Administrative Agent in accordance with Section 6.4, requested the relevant Lenders to convert all or a portion of an outstanding Loan (other than a BA Equivalent Loan) into another type of Loan (other than a BA Equivalent Loan) under a particular Credit Facility, each relevant Lender shall, on the date of conversion (which, in the case of the conversion of all or a portion of an outstanding LIBOR Loan, shall be the date on which the Loan matures), continue to extend credit to such Borrower by way of the type of Loan into which the outstanding Loan or a portion thereof is converted in the aggregate principal amount equal to such Lender’s Pro Rata Share of the principal amount of the Loan being converted or the Exchange Equivalent thereof.
 
6.2	Converting Loan to Bankers’ Acceptances.	
Subject to the terms and conditions hereof and provided that a Borrower has, by giving notice to the Administrative Agent in accordance with Section 6.4, requested the relevant Lenders to accept its drafts to replace all or a portion of an outstanding Loan and, if a LIBOR Loan or a BA Equivalent Loan is to be replaced the date of conversion is the date on which such Loan matures, each relevant Lender shall, on the date of conversion, accept such Borrower’s draft or drafts having an aggregate face amount equal to its Pro Rata Share of the aggregate principal amount of such Loan or the portion thereof which is being converted.
 
6.3	Converting Bankers’ Acceptances to Loan.	
Each relevant Lender shall, on the maturity date of a Bankers’ Acceptance which such Lender has accepted, pay to the holder thereof the face amount of such Bankers’ Acceptance. Provided that a Borrower has, by giving notice to the Administrative Agent in accordance with Section 6.4, requested the relevant Lenders to convert all or a portion of outstanding maturing Bankers’ Acceptances into a Loan, each relevant Lender shall, upon the maturity date of such Bankers’ Acceptances and the payment by such Lender to the holders of such Bankers’ Acceptances of the aggregate face amount thereof and concurrent with the payment by or on behalf of such Borrower to such Lender of the aggregate face amount of such Bankers’ Acceptances, extend credit to the Borrower by way of the Loan into which the matured Bankers’ Acceptances or a portion thereof are converted in the aggregate principal amount equal to its Pro Rata Share of the aggregate face amount of the matured Bankers’ Acceptances or the
 
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portion thereof which are being converted or the Exchange Equivalent thereof. Where a particular Lender has funded a Borrower by way of a BA Equivalent Loan rather than by way of Bankers’ Acceptances, the provisions of this Section 6.3 as they relate to Bankers’ Acceptances shall apply mutatis mutandis to such BA Equivalent Loan.
 
6.4	Conversion Notice.	
The notice to be given to the Administrative Agent pursuant to Section 6.1, 6.2 or 6.3 (“ Conversion Notice ”) shall be irrevocable, shall be given in accordance with Section 3.12 and shall be substantially in the form of Schedule F hereto.
 
6.5	Absence of Notice.	
Subject to the terms and conditions hereof, in the absence of a Rollover Notice or Conversion Notice within the appropriate time periods referred to herein, a maturing LIBOR Loan shall be automatically converted to a Base Rate Canada Loan and a maturing Bankers’ Acceptance or BA Equivalent Loan shall be automatically converted to a Prime Rate Loan as though a notice to such effect had been given in accordance with Section 6.4.
 
6.6	Conversion After Default.	
If a Default has occurred and is continuing at 11:00 a.m. (Toronto time) on the third Banking Day prior to the maturity date of a LIBOR Loan, BA Equivalent Loan or Bankers’ Acceptance, such LIBOR Loan shall automatically convert to a Base Rate Canada Loan and such BA Equivalent Loan or Bankers’ Acceptance shall automatically convert to a Prime Rate Loan on the relevant maturity date as though a notice to such effect had been given in accordance with Section 6.4.
ARTICLE 7
INTEREST AND FEES
 
7.1	Interest Rates.	
The applicable Borrower shall pay to the relevant Lenders, in accordance with Section 3.8, interest on the outstanding principal amount from time to time of each Loan (other than BA Equivalent Loans) and on the amount of overdue interest thereon from time to time, at the rate per annum equal to:
 
 	(i)	the Prime Rate plus the Applicable Margin in the case of each Prime Rate Loan;	
 
 	(ii)	the Alternate Base Rate Canada plus the Applicable Margin in the case of each Base Rate Canada Loan; and	
 
 	(iii)	LIBOR plus the Applicable Margin in the case of each LIBOR Loan.	
 
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7.2	Interest In Advance.	
Interest on each BA Equivalent Loan shall be paid in advance as provided in Section 3.5.
 
7.3	Calculation and Payment of Interest.	
 
 	(a)	Interest on the outstanding principal amount from time to time of each Loan (other than BA Equivalent Loans) and on the amount of overdue interest thereon from time to time shall accrue from day to day from and including the date on which credit is obtained by way of such Loan or the date on which such payment of overdue interest was due, as the case may be, to but excluding the date on which such Loan or such overdue interest, as the case may be, is repaid in full (both before and after maturity and as well after as before judgment) and shall be calculated on the basis of the actual number of days elapsed divided by 365 or 366 in the case of a leap year (in the case of a Prime Rate Loan or Base Rate Canada Loan) or divided by 360 days (in the case of a LIBOR Loan).	
 
 	(b)	Accrued interest shall be paid,	
 
 	(i)	in the case of interest on Prime Rate Loans and Base Rate Canada Loans, monthly in arrears on the 21 st day of each calendar month; and	
 
 	(ii)	in the case of interest on LIBOR Loans, on the last day of the applicable Interest Period; provided that, in the case of Interest Periods of a duration longer than three months, accrued interest shall be paid no less frequently than every three months from the first day of such Interest Period during the term of such Interest Period and on the date on which such Loans are otherwise required to be repaid.	
 
7.4	General Interest Rules.	
 
 	(a)	For the purposes hereof, whenever interest is calculated on the basis of a year of 360 or 365 days, each rate of interest determined pursuant to such calculation expressed as an annual rate for the purposes of the Interest Act (Canada) is equivalent to such rate as so determined multiplied by the actual number of days in the calendar year in which the same is to be ascertained and divided by 360 or 365, respectively.	
 
 	(b)	Interest on each Loan shall be payable in the currency in which such Loan is denominated during the relevant period.	
 
 	(c)	If a Borrower fails to pay any fee or other amount of any nature payable by it to the Administrative Agent or the relevant Lenders hereunder (other than principal or interest) on the due date therefor or under any document, instrument or agreement delivered pursuant hereto on the due date therefor, such Borrower shall pay to the relevant Lenders interest on such overdue amount in the same currency as such overdue amount is payable from and including such due date to but	
 
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 	excluding the date of actual payment (as well after as before judgment) at the rate per annum, calculated and compounded monthly, which is equal to:	
 
 	(i)	the Alternate Base Rate Canada plus the Applicable Margin plus 2% per annum in the case of overdue amounts denominated in U.S. dollars payable; or	
 
 	(ii)	the Prime Rate plus the Applicable Margin plus 2% per annum in the case of all other overdue amounts.	
Such interest on overdue amounts shall become due and be paid on demand by the Administrative Agent.
 
7.5	Selection of Interest Periods.	
With respect to each LIBOR Loan, the applicable Borrower shall specify in the Drawdown Notice, Rollover Notice or Conversion Notice, the duration of the Interest Period provided that:
 
 	(a)	Interest Periods for LIBOR Loans shall have a duration of 1 month, 2 months, 3 months or 6 months; other Interest Periods will be available in the sole discretion of the Lenders;	
 
 	(b)	the first Interest Period for a LIBOR Loan shall commence on and include the day on which credit is obtained by way of such Loan and each subsequent Interest Period applicable thereto shall commence on and include the date of the expiry of the immediately preceding Interest Period applicable thereto; and	
 
 	(c)	if any Interest Period would end on a day which is not a Banking Day, such Interest Period shall be extended to the next succeeding Banking Day unless such next succeeding Banking Day falls in the next calendar month, in which case such Interest Period shall be shortened to end on the immediately preceding Banking Day.	
 
7.6	Acceptance Fees.	
Upon the acceptance of any draft of a Borrower pursuant hereto, such Borrower shall pay to the relevant Lenders, in accordance with Section 3.8, in advance, an acceptance fee calculated at the rate per annum, on the basis of a year of 365 days equal to the Applicable Margin on the face amount of such Bankers’ Acceptance for its term, being the actual number of days in the period commencing on the date of acceptance of such Borrower’s draft and ending on but excluding the maturity date of the Bankers’ Acceptance. With respect to each drawdown by way of Bankers’ Acceptances, such acceptance fees shall be paid by the relevant Lenders deducting the amount thereof from the BA Discounted Proceeds before the relevant Lenders remit the BA Proceeds to the Administrative Agent as provided in Section 3.4(c). With respect to each rollover of and conversion into Bankers’ Acceptances, such acceptance fees shall be paid by the applicable Borrower to the Administrative Agent as provided in Section 3.4(c). Each such payment is non-refundable and fully earned when due.
 
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7.7	Standby Fee.	
Upon the last day of each calendar quarter and upon the termination of the RT Facility pursuant to Section 2.5, the Borrowers shall pay to the relevant Lenders in accordance with Section 3.8, in arrears, a standby fee on the applicable Available RT Credit, calculated and accruing daily from the date of this agreement becoming effective, at the rate per annum, calculated on the basis of a year of 365 days or 366 days in the case of a leap year, equal to the Applicable Margin during such period.
 
7.8	Letter Fees.	
The relevant Borrower shall pay to the relevant Lenders, in accordance with Section 3.8, an issuance fee quarterly in arrears on the last day of each calendar quarter, calculated at a rate per annum, on the basis of a year of 365 days or 366 days in the case of a leap year, equal to the Applicable Margin and on the amount of each such Letter for the period of time equal to the number of days in the preceding Fiscal Quarter on which such Letter was outstanding.
 
7.9	Interest and Fee Adjustment.	
Subject to the second sentence hereof, the changes in the interest rates, acceptance fees, standby fees and Letter issuance fees contemplated in the definition of Applicable Margin shall be effective as of the date of receipt by the Administrative Agent of the compliance certificate required to be delivered by the Borrowers to the Administrative Agent pursuant to Section 11.1(b)(iii) (and, for greater certainty in the case of interest on LIBOR Loans and Letter issuance fees shall be effective for that portion of the term of any LIBOR Loans or Letters on and after such date and in the case of interest on any outstanding BA Equivalent Loans and acceptance fees shall only be effective at the end of the term of such BA Equivalent Loan or Bankers’ Acceptance). The aforesaid changes shall be effective as of the relevant Reporting Date if the compliance certificate required to be delivered by the Borrowers to the Administrative Agent pursuant to Section 11.1(b)(iii) is delivered after the relevant Reporting Date if such compliance certificate evidences an increase in the Applicable Margin. If, however, any such compliance certificate delivered after the relevant Reporting Date evidences a decrease in the Applicable Margin, the aforesaid changes shall only be effective as and from the date of receipt by the Administrative Agent of such compliance certificate. Upon receipt of any compliance certificate which is delivered to the Administrative Agent after the relevant Reporting Date which evidences an increase in the Applicable Margin, the Administrative Agent shall determine the amount of the underpayment of interest, acceptance fees, standby fees and Letter issuance fees during the period from the relevant Reporting Date to and including the date of actual delivery thereof and notify the Borrowers and the Lenders of such amounts. Such determination by the Administrative Agent shall constitute, in the absence of manifest error, prima facie evidence of the amount of such underpayment. The Borrowers shall, upon receipt of such notice, pay to the Lenders, in accordance with Section 3.8, the amount of such underpayment.
 
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ARTICLE 8
RESERVE, CAPITAL, INDEMNITY AND TAX PROVISIONS
 
8.1	Increased Costs.	
 
 	(a)	If from time to time any Change in Law shall:	
 
 	(i)	impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, a Credit Party;	
 
 	(ii)	subject a Credit Party to any Tax of any kind whatsoever with respect to this agreement, any Letter, any participation in a Letter, or any extension of credit made by it, (including, without limitation, any “transaction tax” not based on income), or change the basis of taxation of payments to a Credit Party in respect thereof, except for (A) Indemnified Taxes or Other Taxes covered by Section 8.4, and (B) any Excluded Tax payable by the Credit Party; or	
 
 	(iii)	impose on a Credit Party or any applicable interbank market any other condition, cost or expense affecting this agreement or extensions of credit made by such Credit Party;	
and the result of any of the foregoing shall be to increase the cost to a Credit Party of making or maintaining any extension of credit (or of maintaining its obligation to make any such extensions of credit), or to reduce the amount of any sum received or receivable by a Credit Party hereunder (whether of principal, interest or any other amount), then upon request of the relevant Credit Party from time to time the Borrowers will pay to the relevant Credit Party such additional amount or amounts as will compensate it for such additional costs incurred or reduction suffered, such amount or amounts to be determined in the sole and absolute discretion of the relevant Credit Party, acting reasonably.
 
 	(b)	If a Credit Party determines in its sole and absolute discretion that any Change in Law affecting such Credit Party or any lending office of the Credit Party regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Credit Party’s capital as a consequence of this agreement, the commitments of the Credit Party under any Loan Document or the credit extended by the Lender hereunder, to a level below that which the Credit Party could have achieved but for such Change in Law (taking into consideration the Credit Party’s policies with respect to, as applicable, capital adequacy or liquidity requirements), then from time to time the Borrowers will pay to such Credit Party such additional amount or amounts as will compensate such Credit Party for any such reduction suffered, such amount or amounts to be determined in the sole and absolute discretion of such Credit Party, acting reasonably.	
 
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 	(c)	A certificate of a Credit Party setting forth the amount or amounts necessary to compensate the Lender as specified in paragraph (a) or (b) of this Section, including reasonable detail of the basis of calculation of the amount or amounts, and delivered to the Borrowers from time to time shall be conclusive absent manifest error. The Borrowers shall pay the relevant Credit Party the amount shown as due on any such certificate within 10 days after receipt thereof.	
 
 	(d)	Failure or delay on the part of a Credit Party to demand compensation pursuant to this Section shall not constitute a waiver of such Credit Party’s right to demand such compensation, except that the Borrowers shall not be required to compensate a Credit Party pursuant to this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Credit Party notifies the Borrowers of the Change in Law giving rise to such increased costs or reductions and of such Credit Party’s intention to claim compensation therefore, unless the Change in Law giving rise to such increased costs or reductions is retroactive, in which case the nine-month period referred to above shall be extended to include the period of retroactive effect thereof.	
 
8.2	Failure to Fund as a Result of Change of Circumstances.	
If any Lender but not all of the Lenders who have Individual Commitments seeks additional compensation pursuant to Section 8.1(a) or requires a Borrower to make any additional payment in respect of Taxes under Section 8.5 or becomes a Defaulting Lender or a Non-FATCA Compliant Lender (in each case, the “ Affected Lender ”), then the applicable Borrower or Borrowers may indicate to the Administrative Agent in writing that it desires to replace the Affected Lender with one or more of the other Lenders, and the Administrative Agent shall then forthwith give notice to the other relevant Lenders that any such Lender or Lenders may, in the aggregate, advance all (but not part) of the Affected Lender’s Pro Rata Share of the affected credit and, in the aggregate, assume all (but not part) of the Affected Lender’s Individual Commitments and obligations under the relevant Credit Facility and acquire all (but not part) of the rights of the Affected Lender and assume all (but not part) of the obligations of the Affected Lender under each of the other Loan Documents to the extent they relate to such Credit Facility (but in no event shall any other relevant Lender or the Administrative Agent be obliged to do so). If one or more relevant Lenders shall so agree in writing (herein collectively called the “ Assenting Lenders ” and individually called an “ Assenting Lender ”) with respect to such advance, acquisition and assumption, the Pro Rata Share of such credit of each Assenting Lender and the Individual Commitments and the obligations of such Assenting Lender under such Credit Facility and the rights and obligations of such Assenting Lender under each of the other Loan Documents shall be increased by its respective pro rata share (based on the relative Individual Commitments of the Assenting Lenders under such Credit Facility) of the Affected Lender’s Pro Rata Share of such credit and Individual Commitments and obligations and rights and obligations under each of the other Loan Documents on a date mutually acceptable to the Assenting Lenders and the applicable Borrower or Borrowers. On such date, the Assenting Lenders shall extend to the applicable Borrower or Borrowers the Affected Lender’s Pro Rata Share of such credit and shall prepay to the Affected Lender the advances of the Affected Lender then outstanding, together with all interest accrued thereon and all other amounts owing to the Affected Lender hereunder, and, upon such advance and prepayment by the Assenting Lenders,
 
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the Affected Lender shall cease to be a “ Lender ” for purposes of this agreement and shall no longer have any obligations hereunder. Upon the assumption of the Affected Lender’s Individual Commitments as aforesaid by an Assenting Lender, Schedule A hereto shall be deemed to be amended to increase the Individual Commitments of such Assenting Lender by the respective amounts of such assumption. Alternately, the applicable Borrower or Borrowers may require the Affected Lender to assign all (but not part) of the Affected Lender’s Pro Rata Share of the affected credit and all (but not part) of the Affected Lender’s Individual Commitments and obligations under the relevant Credit Facility to another Person in compliance with Section 16.6(c).
 
8.3	Indemnity Relating to Credits.	
Upon notice from the Administrative Agent to the applicable Borrower or Borrowers (which notice shall be accompanied by a detailed calculation of the amount to be paid by the applicable Borrower or Borrowers), the applicable Borrower or Borrowers shall pay to the Administrative Agent, the relevant Lenders or the relevant Issuing Lender such amount or amounts as will compensate the Administrative Agent, the relevant Lenders or the relevant Issuing Lender for any loss, cost or expense incurred by them:
 
 	(a)	in the liquidation or redeposit of any funds acquired by such Lenders to fund or maintain any portion of a LIBOR Loan or BA Equivalent Loan as a result of:	
 
 	(i)	the failure of the applicable Borrower or Borrowers to borrow or make repayments on the dates specified under this agreement or in any notice from the applicable Borrower or Borrowers to the Administrative Agent (provided that if any notice specifies the repayment of a LIBOR Loan or a BA Equivalent Loan at any time other than its maturity date, then the applicable Borrower or Borrowers shall be responsible for any loss, costs or expenses referred to above); or	
 
 	(ii)	the repayment or prepayment of any amounts on a day other than the payment dates prescribed herein or in any notice from the applicable Borrower or Borrowers to the Administrative Agent (provided that if any notice specifies the repayment of a LIBOR Loan or a BA Equivalent Loan at any time other than its maturity date, then the applicable Borrower or Borrowers shall be responsible for any loss, costs or expenses referred to above);	
 
 	(b)	in converting United States dollars into Canadian dollars or Canadian dollars into United States dollars as a result of the failure of the applicable Borrower or Borrowers to make repayments of outstanding credit hereunder in the currency in which such outstanding credit was denominated; or	
 
 	(c)	with respect to any Bankers’ Acceptance or Letter, arising from claims or legal proceedings, and including reasonable legal fees and disbursements, respecting the obtaining of credit by the relevant Borrower by way of such Bankers’ Acceptance or Letter, the collection of amounts owed by such Borrower	
 
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 	hereunder in respect of such Bankers’ Acceptance or Letter or the enforcement of any Issuing Lender’s or Lender’s rights hereunder in respect of such Bankers’ Acceptance or Letter including, without limitation, legal proceedings attempting to restrain any Issuing Lender or any Lender or any of them from paying any amount under such Bankers’ Acceptance or Letter.	
 
8.4	Indemnity for Transactional and Environmental Liability.	
 
 	(a)	The Borrowers hereby agree to indemnify, exonerate and hold each Credit Party (collectively, the “ Indemnified Persons ”, and individually, an “ Indemnified Person ”) free and harmless from and against any and all claims, demands, actions, causes of action, suits, losses, costs (including, without limitation, all documentary, recording, filing, mortgage or other stamp taxes or duties), charges, liabilities and damages, and expenses in connection therewith (irrespective of whether such Indemnified Person is a party to the action for which indemnification hereunder is sought), and including, without limitation, reasonable legal fees, out of pocket disbursements and amounts paid to the Indemnified Persons’ respective affiliates, employees, officers, directors and agents (collectively, in this Section 8.4(a), the “ Indemnified Liabilities ”), paid, incurred or suffered by the Indemnified Persons or any of them as a result of, or arising out of, or relating to (i) any use made or to be made in whole or in part, directly or indirectly, with the proceeds of any credit obtained hereunder, or (ii) the execution, delivery, performance or enforcement of this agreement and any instrument, document or agreement executed pursuant hereto, except for any such Indemnified Liabilities that a court of competent jurisdiction determined arose on account of the relevant Indemnified Person’s gross negligence or wilful misconduct.	
 
 	(b)	Without limiting the generality of the indemnity set out in Section 8.4(a), the Borrowers hereby further agree to indemnify, exonerate and hold the Indemnified Persons free and harmless from and against any and all claims, demand, actions, causes of action, suits, losses, costs, charges, liabilities and damages, and expenses in connection therewith, including, without limitation, reasonable legal fees, out of pocket disbursements and amounts paid to the Indemnified Persons’ respective affiliates, employees, officers, directors and agents, of any and every kind whatsoever (collectively, in this Section 8.4(b), the “ Indemnified Liabilities ”), paid, incurred or suffered by the Indemnified Persons or any of them for, with respect to, or as a direct or indirect result of, (i) the presence on or under, or the escape, seepage, leakage, spillage, discharge, emission or release from, any Property of any Hazardous Material or (ii) the breach or violation of any Environmental Law by any Company, except for any such Indemnified Liabilities that a court of competent jurisdiction determines arose on account of the relevant Indemnified Person’s gross negligence or wilful misconduct.	
 
 	(c)	All obligations provided for in this Section 8.4 shall survive any termination of the Credit Facilities or this agreement and shall not be reduced or impaired by any investigation made by or on behalf of any Credit Party.	
 
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 	(d)	If, for any reason, the obligations of the Borrowers pursuant to this Section 8.4 shall be unenforceable, the Borrowers agree to make the maximum contribution to the payment and satisfaction of each obligation that is permissible under Applicable Law, except to the extent that a court of competent jurisdiction determines such obligations arose on account of the gross negligence or wilful misconduct of any Indemnified Person.	
 
8.5	Payments Free and Clear of Taxes.	
 
 	(a)	Any and all payments made by the Primary Obligors hereunder or under any other Loan Document (any such payment being hereinafter referred to as a “ Payment ”) to or for the benefit of a Credit Party shall be made without set-off or counterclaim, and free and clear of, and without deduction or withholding for, or on account of, any and all present or future Taxes, except to the extent such deduction or withholding is required by Applicable Law or the administrative practice of any Official Body. If the Primary Obligors shall be so required to deduct or withhold any Taxes from or in respect of any Payment made to or for the benefit of a Credit Party, the Borrowers shall:	
 
 	(i)	promptly notify such Credit Party of such requirement;	
 
 	(ii)	with respect to Indemnified Taxes, pay to such Credit Party in addition to the Payment to which such Credit Party is otherwise entitled, such additional amount as is necessary to ensure that the net amount received by such Credit Party (free and clear of, and net of, any Indemnified Taxes, including the full amount of any Indemnified Taxes required to be deducted or withheld from any additional amount paid by the Borrowers under this Section 8.5(a), whether assessable against the Primary Obligors or such Credit Party) equals the full amount such Credit Party would have received had no such deduction or withholding been required;	
 
 	(iii)	make such deduction or withholding;	
 
 	(iv)	pay to the relevant Official Body in accordance with Applicable Law the full amount of Taxes required to be deducted or withheld (including the full amount of Taxes required to be deducted or withheld from any additional amount paid by the Borrowers to such Credit Party under this Section 8.5(a)), within the time period required by Applicable Law; and	
 
 	(v)	as promptly as possible thereafter, forward to such Credit Party an original official receipt (or a certified copy), or other documentation reasonably acceptable to such Credit Party, evidencing such payment to such Official Body.	
 
 	(b)	In addition, the Primary Obligors agree to pay any and all present or future stamp or documentary taxes or excise or property taxes, charges or levies of a similar nature, which arise from any Payment or from the execution, delivery or registration of, or otherwise with respect to, the Loan Documents and the transactions contemplated thereby (any such amounts being hereinafter referred to as “ Other Taxes ”).	
 
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 	(c)	The Primary Obligors hereby indemnify and hold harmless each Credit Party for the full amount of Indemnified Taxes and Other Taxes (including Indemnified Taxes and Other Taxes imposed under this Section 8.5(c)) levied, imposed or assessed against (and whether or not paid directly by) a Credit Party. In addition, the Primary Obligors hereby indemnify and hold harmless each Credit Party for all interest, penalties and reasonable expenses, resulting from or relating to a Primary Obligor’s failure to:	
 
 	(i)	remit to any Credit Party the documentation referred to in Section 8.5(a)(v); or	
 
 	(ii)	pay any Taxes or Other Taxes when due to the relevant Official Body (including, without limitation, any Taxes imposed by any Official Body on amounts payable under this Section 8.5(c)(ii)).	
The provisions of this Section 8.5(c) shall apply whether or not such Taxes or Other Taxes were correctly or legally assessed. Any Credit Party who pays any Indemnified Taxes or Other Taxes, interest, penalties and reasonable expenses, shall promptly notify the Primary Obligors of such payment, provided, however, that failure to provide such notice shall not detract from, or compromise, the obligations of the Borrowers under this Section 8.5. Payment pursuant to this indemnification shall be made within 30 days from the date the relevant Credit Party makes written demand therefor accompanied by a certificate as to the amount of such Indemnified Taxes or Other Taxes, interest, penalties and the calculation thereof, which certificate shall be conclusive absent manifest error.
 
 	(d)	If the Primary Obligors determine in good faith that a reasonable basis exists for contesting any Indemnified Taxes for which a payment has been made under this Section 8.5, a Credit Party shall, if so requested by the Primary Obligors, cooperate with the Primary Obligors in challenging such Indemnified Taxes at the Primary Obligors’ expense.	
 
 	(e)	If a Credit Party receives a refund of Taxes for which a payment has been made by the Primary Obligors under this Section 8.5, which refund in the good faith judgment of the such Credit Party is attributable to the Indemnified Taxes giving rise to such payment made by a Primary Obligor, then such Credit Party shall reimburse the relevant Primary Obligor for such amount (if any, but not exceeding the amount of any payment made under this Section 8.5 that gives rise to such refund), net of out-of-pocket expenses of such Credit Party which such Credit Party determines in its absolute discretion will leave it, after such reimbursement, in no better or worse position than it would have been in if such Indemnified Taxes had not been exigible. The Primary Obligors, upon the request of a Credit Party agree to repay such Credit Party any portion of any such refund paid over to the Primary Obligors that such Credit Party is required to pay to the	
 
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 	relevant Official Body and agrees to pay any interest, penalties or other charges paid by such Credit Party as a result of or related to such payment to such Official Body. Notwithstanding the foregoing, such Credit Party shall not be under any obligation to arrange its tax affairs in any particular manner so as to claim any refund.	
 
 	(f)	The Primary Obligors’ obligations under this Section 8.5 shall survive the termination of the Credit Facilities and this agreement and the permanent repayment of the outstanding credit and all other amounts payable hereunder.	
 
 	(g)	If a payment made to a Credit Party under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Credit Party were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Credit Party shall deliver to the Primary Obligors and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Primary Obligors or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Primary Obligors or the Administrative Agent as may be necessary for the Primary Obligors and the Administrative Agent to comply with their obligations under FATCA and to determine that such Credit Party has complied with such Credit Party’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this Section 8.5(g), “ FATCA ” shall include any amendments made to FATCA after the date of this Agreement. Each Credit Party agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Primary Obligors and the Administrative Agent in writing of its legal inability to do so.	
ARTICLE 9
REPAYMENTS AND PREPAYMENTS
 
9.1	Repayment of Credit Facilities.	
 
 	(a)	On the Maturity Date, the Borrowers shall pay to the relevant Lenders the full amount of the credit outstanding under the RT Facility together with all accrued and unpaid interest thereon and all accrued and unpaid fees with respect thereto.	
 
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 	(b)	The NRT Drawn Amount shall be repaid by Anixter Canada to the relevant Lenders in installments on the dates and in the amounts set forth below:	

Date of Installment	  	Percentage of NRT
Drawn Amount	 	
December 31, 2015	  	 	1.25	% 	
March 31, 2016	  	 	1.25	% 	
June 30, 2016	  	 	1.25	% 	
September 30, 2016	  	 	1.25	% 	
December 31, 2016	  	 	1.25	% 	
March 31, 2017	  	 	1.25	% 	
June 30, 2017	  	 	1.25	% 	
September 30, 2017	  	 	1.25	% 	
December 31, 2017	  	 	2.5	% 	
March 31, 2018	  	 	2.5	% 	
June 30, 2018	  	 	2.5	% 	
September 30, 2018	  	 	2.5	% 	
December 31, 2018	  	 	2.5	% 	
March 31, 2019	  	 	2.5	% 	
June 30, 2019	  	 	2.5	% 	
September 30, 2019	  	 	2.5	% 	
December 31, 2019	  	 	2.5	% 	
March 31, 2020	  	 	2.5	% 	
June 30, 2020	  	 	2.5	% 	
September 30, 2020	  	 	2.5	% 	
The balance of NRT Drawn Amount owing after the last installment, together with all accrued and unpaid interest thereon and all accrued and unpaid fees with respect thereto, shall be repaid in full on the Maturity Date. Amounts which are repaid as aforesaid may not be reborrowed.
 
9.2	Voluntary Prepayments.	
Subject to Section 9.4, the Borrowers shall be entitled, at their option, to prepay all or any portion of the outstanding Loans (other than BA Equivalent Loans) under either Credit Facility at any time provided that Section 8.3 shall be complied with in connection with any prepayment. Prepayments under the RT Facility pursuant to this Section 9.2 may be reborrowed. Prepayments under the NRT Facility pursuant to this Section 9.2 may not be reborrowed but shall be applied to the installment payments referenced in Section 9.1(b) in order of maturity, with the result that the next scheduled installment payment(s) after a voluntary prepayment will be reduced or eliminated.
 
9.3	Mandatory Prepayments under the NRT Facility.	
 
 	(a)	Anixter Canada shall, within five Banking Days of the occurrence of a Prepayment Trigger Event, prepay outstanding credit under the NRT Facility in an amount equal to 100% of the Net Cash Proceeds in excess of the amount, if any, stipulated in, and in respect of, such Prepayment Trigger Event.	
 
 	(b)	Unless waived by the Lenders in their sole and absolute discretion, in respect of each Fiscal Year commencing with the 2016 Fiscal Year, Anixter Canada shall	
 
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 	prepay, on or before the last day of the first Fiscal Quarter in each immediately following Fiscal Year, outstanding credit under the NRT Facility in an amount equal to:	
 
 	(i)	50% of Excess Cash Flow if the Total Leverage Ratio was greater than or equal to 2.50 to 1 as at the last day of such Fiscal Year; or	
 
 	(ii)	25% of Excess Cash Flow if the Total Leverage Ratio was greater than or equal to 2.00 to 1, but less than 2.50 to 1, as at the last day of such Fiscal Year.	
 
 	(c)	Amounts which are prepaid as aforesaid under the NRT Facility may not be reborrowed and shall be applied to the installment payments referenced in Section 9.1(b) in inverse order of maturity. Section 8.3 shall be complied with in connection with any prepayment pursuant to this Section 9.3.	
 
9.4	Prepayment Notice.	
The Borrowers shall give written notice to the Administrative Agent of each voluntary prepayment pursuant to Section 9.2. Such notice (a “ Prepayment Notice ”) shall be irrevocable, shall be given in accordance with Section 3.12 and shall specify:
 
 	(a)	the Credit Facility under which the prepayment is to be made;	
 
 	(b)	the applicable Borrower making the prepayment;	
 
 	(c)	the date on which the prepayment is to take place; and	
 
 	(d)	the type and principal amount of the Loan or the portion thereof which is to be prepaid.	
 
9.5	Reimbursement Obligation for Maturing Bankers’ Acceptances.	
The Borrowers hereby unconditionally agrees to pay to each relevant Lender on the maturity date (whether at stated maturity, by acceleration or otherwise) of each Bankers’ Acceptance accepted by such Lender the undiscounted face amount of such then-maturing Bankers’ Acceptance. The obligation of the Borrowers to reimburse the Lenders for then-maturing Bankers’ Acceptances may be satisfied by:
 
 	(a)	paying to the relevant Lenders, in accordance with Section 3.8, on the maturity date of the Bankers’ Acceptances an amount equal to the aggregate undiscounted face amount thereof, provided that the applicable Borrower shall notify the Administrative Agent of its intention to reimburse the Lenders in such manner prior to 10:00 a.m. (Toronto time) on such maturity date;	
 
 	(b)	replacing the maturing Bankers’ Acceptances with new Bankers’ Acceptances in accordance with Section 5.1; or	
 
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 	(c)	converting the maturing Bankers’ Acceptances into a Loan in accordance with Section 6.3, 6.5 or 6.6.	
In no event shall any Borrower claim from the Lenders any grace period with respect to the aforesaid obligation of the Borrowers to reimburse the Lenders.
 
9.6	Reimbursement or Conversion on Presentation of Letters.	
 
 	(a)	On presentation of a Letter issued by a particular Issuing Lender and payment thereunder by such Issuing Lender, the applicable Borrower shall forthwith pay to the Administrative Agent for the account of such Issuing Lender, and thereby reimburse such Issuing Lender for, all amounts paid by such Issuing Lender pursuant to such Letter; failing such payment, such Borrower shall be deemed to have effected a conversion of such Letter into (x) a Prime Rate Loan (if such Letter is denominated in Canadian dollars) or (y) a Base Rate Canada Loan (if such Letter is denominated in United States dollars or any other currency (other than Canadian dollars), the amount paid under such Letter being the Exchange Equivalent United States dollars of the amount so paid), in each case to the extent of the payment of such Issuing Lender thereunder.	

	  	(b)	  		  		  	(i)	  	If any Issuing Lender makes payment under any Letter issued by such Issuing Lender and the relevant Borrower does not fully reimburse such Issuing Lender on or before the date of payment, then Section 9.6(a) shall apply to deem (x) a Prime Rate Loan (if such Letter is denominated in Canadian dollars) or (y) a Base Rate Canada Loan (if such Letter is denominated in United States dollars or any other currency (other than Canadian dollars), the amount paid under such Letter being the Exchange Equivalent United States dollars of the amount so paid), in each case to be outstanding to the relevant Borrower under this agreement in the manner herein set out. Each relevant Lender shall, on request by the relevant Issuing Lender, immediately pay to such Issuing Lender an amount equal to such Lender’s Pro Rata Share of the amount paid by such Issuing Lender such that each such Lender is participating in the deemed Prime Rate Loan or Base Rate Canada Loan in accordance with its Pro Rata Share.	
						
	  		  		  		  	(ii)	  	Each relevant Lender shall immediately on demand indemnify each Issuing Lender to the extent of such Lender’s Pro Rata Share of any amount paid or liability incurred by such Issuing Lender under each Letter issued by it to the extent that the relevant Borrower does not fully reimburse such Issuing Lender therefor.	
 
 	(c)	For certainty, the obligations in this Section 9.6 shall continue as obligations of each Person who was a relevant Lender at the time each such Letter was issued notwithstanding that such Lender may assign its rights and obligations hereunder, unless the relevant Issuing Lender specifically releases such Lender from such obligations in writing.	
 
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9.7	Letters Subject to an Order.	
Each Borrower shall pay to the Administrative Agent for the account of the Issuing Lender an amount equal to the maximum amount available to be drawn under any unexpired Letter which becomes the subject of any Order. Payment in respect of each such Letter shall be due forthwith no later than one Banking Day after demand.
 
9.8	Repayment of Credit Excess.	
The Borrowers shall repay to the Administrative Agent for the account of the relevant Lenders, on demand by the Administrative Agent, the amount of any Credit Excess existing from time to time, any such repayment to be made no later than one Banking Day after the making of such demand. To the extent any such Credit Excess results solely from currency fluctuations, no such demand shall be made (unless a Default has occurred and is continuing) unless the amount of any such Credit Excess at the time of such demand exceeds 105% of the amount of the relevant Total Commitment Amount at such time.
 
9.9	Currency of Repayment.	
All payments and repayments of outstanding credit hereunder shall be made in the currency of such outstanding credit.
ARTICLE 10
REPRESENTATIONS AND WARRANTIES
 
10.1	Representations and Warranties.	
To induce the Lenders and the Administrative Agent to enter into this agreement and to extend credit to the Borrowers hereunder from time to time, each Primary Obligor hereby represents and warrants to the Lenders and the Administrative Agent, as at the date this agreement becomes effective, as at the date of each extension of credit hereunder, as at the last day of each Fiscal Quarter and as at the date that any Person becomes an Additional Guarantor or a Primary Obligor as follows and acknowledges and confirms that the Lenders and the Administrative Agent are relying upon such representations and warranties in executing this agreement and in extending credit hereunder:
 
 	(a)	Status and Power. Each of the Obligors is validly subsisting under the laws of the jurisdiction of its incorporation, organization or formation and is duly qualified, registered or licensed in all jurisdictions where such qualification, registration or licensing is required except where the lack of such qualification, registration or licensing could not reasonably be expected to have a Material Adverse Effect. Each of the Obligors has all requisite corporate capacity, power and authority to own, hold under licence or lease its properties, to carry on its business as now conducted and to otherwise enter into, and carry out the transactions contemplated by, the Loan Documents to which it is a party.	
 
 	(b)	Authorization and Enforcement of Loan Documents. All necessary action, corporate or otherwise, has been taken to authorize the execution, delivery and	
 
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 	performance by each of the Loan Parties of the Loan Documents to which it is a party. Each of the Loan Parties has duly executed and delivered the Loan Documents to which it is a party. The Loan Documents to which each of the Loan Parties is a party are legal, valid and binding obligations of such Loan Party, enforceable against such Loan Party by the other parties thereto in accordance with their respective terms, except to the extent that the enforceability thereof may be limited by applicable bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance and other similar laws of general application limiting the enforcement of creditors’ rights generally and the fact that the courts may deny the granting or enforcement of equitable remedies.	
 
 	(c)	Compliance with Other Instruments. The execution, delivery and performance by each of the Loan Parties of the Loan Documents to which it is a party, and the consummation of the transactions contemplated herein and therein (i) do not conflict with, result in any breach or violation of, or constitute a default under the terms, conditions or provisions of (A) the articles of incorporation, by-laws or other constating documents of, or any unanimous shareholder agreement or declaration relating to, any Loan Party, (B) any Transaction Document, (C) any Material Contract, (D) any Material Permit or (E) except where such conflict, breach, violation or default could not reasonably be expected to have a Material Adverse Effect, any law, regulation, judgment, decree or order binding on or applicable to any Obligor or to which its property is subject and (ii) do not require the consent or approval of any Official Body or any other Person which has not been obtained and provided to the Administrative Agent except where the lack of such consent or approval could not reasonably be expected to have a Material Adverse Effect.	
 
 	(d)	Financial Statements.	
 
 	(i)	The Financial Statements were prepared in accordance with generally accepted accounting principles consistently applied in accordance with past practice. The Financial Statements fairly present the financial condition of Anixter Canada as at the respective dates thereof and the Financial Statements fairly present in all material respects the results of operations, cash flow and income of Anixter Canada during the respective fiscal periods covered thereby.	
 
 	(ii)	The Obligors (other than Anixter Mid Holdings, the Parent and the Ultimate Parent) have no liabilities, contingent or otherwise, not disclosed on the financial statements referred to earlier in Section 10.1(d)(i) and as of such dates and which are of the type required to be disclosed in accordance with generally accepted accounting principles, other than in respect of liabilities and obligations arising in the ordinary course of business.	
 
 	(e)	Litigation, etc. As of the date hereof, there are no actions, suits, investigations, claims or proceedings which have been commenced or, to the knowledge of any	
 
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 	Primary Obligor, have been threatened in writing against or affecting any of the Obligors before any Official Body which contest the HDS Acquisition or any of the transactions contemplated in any of the Loan Documents or the Transaction Documents. As of the date hereof, there are no actions, suits, investigations, claims or proceedings which have been commenced or, to the knowledge of any Primary Obligor, have been threatened in writing against or affecting any of the Obligors before any Official Body which could reasonably be expected to have a Material Adverse Effect.	
 
 	(f)	Title to Assets. Each of the Secured Obligors has a good and marketable title to all of its property, assets and undertaking, free from any Liens other than the Permitted Liens, and no Person has any agreement or right to acquire any such property, assets and undertaking except as permitted hereunder.	
 
 	(g)	Conduct of Business. No Obligor is in violation of any Applicable Law (including, without limitation, AML/CTF Laws) in a manner which could reasonably be expected to have a Material Adverse Effect. Each Obligor has all licenses, certificates of approval, permits, registrations, approvals and consents which are required to own its properties and assets and to operate its businesses where they are currently being operated, other than any the absence of which would not have a Material Adverse Effect. No Obligor has used any of the proceeds under either Credit Facility for prohibited business activities in any Sanctioned Countries. No Company has used any of the proceeds under either Credit Facility for Sanctioned Activities nor has it engaged in business activities with Sanctioned Persons.	
 
 	(h)	Labour Matters. As of the date hereof, there are no strikes or any other labour disputes against any Obligor pending or threatened which could reasonably be expected to have a Material Adverse Effect. Hours worked by and payment made to employees of each Obligor have not been in violation of any Applicable Law dealing with such matters which could reasonably be expected to have a Material Adverse Effect. All payments due from each Obligor on account of employee health and welfare insurance which could reasonably be expected to have a Material Adverse Effect if not paid have been paid or accrued as a liability on the books of the relevant Obligor.	
 
 	(i)	No Default. No Default exists or would result from the incurring of any Obligations by any Obligor. No Obligor is in default under or with respect to any contractual obligation in any respect which, individually or together with all such defaults, could reasonably be expected to have a Material Adverse Effect, or that would, if such default had occurred after the initial drawdown hereunder, create an Event of Default.	
 
 	(j)	Tax Returns and Taxes. Each Obligor has filed all tax returns and tax reports required by law to have been filed by it and has paid all taxes and governmental charges thereby shown to be owing, except any such taxes or charges which are being diligently contested in good faith by appropriate proceedings and for which adequate reserves in accordance with generally accepted accounting principles shall have been set aside on its books.	
 
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 	(k)	Environmental Compliance.	
 
 	(i)	Each Property (including underlying groundwater) is operated or used by each Obligor in compliance with all Environmental Laws applicable to it, except where non-compliance could not reasonably be expected to have a Material Adverse Effect.	
 
 	(ii)	There are no commenced or threatened (in writing)	
 
 	(A)	claims, complaints or notices received by any Obligor from an Official Body with respect to any alleged material violation of any Environmental Law by such Obligor, or	
 
 	(B)	complaints, notices to, or investigations of, any Obligor from an Official Body regarding potential material liability of such Company under any Environmental Law;	
notice of which has not been provided by any Borrower to the Administrative Agent.
 
 	(iii)	There are no Releases of Hazardous Materials by any Obligor at, on or under any Property which would constitute a breach of any Environmental Law applicable to it to the extent such Release could reasonably be expected to have a Material Adverse Effect.	
 
 	(iv)	Each Obligor has been issued and is in compliance with all permits, certificates, approvals, licenses and other authorizations required under any Environmental Laws to own its properties and assets and to carry on its businesses, except where the non-issuance or non-compliance could not reasonably be expected to have a Material Adverse Effect.	
 
 	(l)	Perfection Certificates. Each Secured Obligor has executed and delivered to the Administrative Agent a completed Perfection Certificate and all information in each such Perfection Certificate is true and correct in all material respects as of each date referenced in Section 11.1(b)(iii).	
 
 	(m)	Consents, Approvals, etc. No consents, approvals, acknowledgements, undertakings, non-disturbance agreements, directions or other documents or instruments which have not already been provided to the Administrative Agent are required to be entered into by any Official Body or any Person (i) to make effective the Security created or intended to be created by the Obligors in favour of the Administrative Agent pursuant to the Security Documents, (ii) to ensure the perfection and the intended priority of such Security other than financing statements filed in connection with such Security or (iii) to implement the financing contemplated by the Loan Documents.	
 
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 	(n)	Material Contracts and Material Permits. Each Material Contract to which any Obligor is a party is in full force and effect and no material breach by any party thereto of any of the terms or conditions thereof has occurred and is continuing, there have been no events that are continuing which, but for giving notice, lapse of time or any other condition subsequent, would constitute a default of a material obligation thereunder or would allow the termination of such Material Contract or the imposition of any material sanction on any party to such Material Contract of which it is aware and no party to such Material Contract has any set-off or counterclaim against it relating to or affecting such Material Contract of which it is aware. Each Material Permit to which any Obligor is party or of which any Obligor has the benefit is in full force and effect, without further amendment thereto, and no further or other Official Body Consent is required for any Obligor to carry on its business as conducted, except to the extent that a failure to maintain, comply with, or to have, the same would not or could not reasonably be expected to have a Material Adverse Effect.	
 
 	(o)	Assets Insured. The Secured Assets are insured with insurers, in amounts, for risks and otherwise on terms which are reasonable in relation to the Secured Assets (subject to the amount of such deductibles as are reasonable and normal in the circumstances) against loss or damage and there has been no default or failure by the party or parties insured under the provisions of such policies of insurance maintained which would prevent the recovery by the party or parties insured thereunder of the full amount of any material insured loss. The named insured under all insurance policies maintained by each Secured Obligor are not in default under any of the material provisions contained in any such insurance policies.	
 
 	(p)	Capital of Pledged Companies. Schedule L sets out, as at the time immediately following completion of the HDS Acquisition (A) the authorized and issued capital of each Pledged Company, all of which issued Shares (in the case of corporations) have been issued and are outstanding as fully paid and non-assessable and (B) the owner of record of all such issued Shares. In each case other than as held by or issued to an Obligor (provided written notice of such has been provided by the Borrowers to the Administrative Agent), there are no outstanding warrants, options or other agreements which require or may require the issuance of any Shares of any Pledged Company or the issuance of any debt or securities convertible into Shares of any Pledged Company, there are no outstanding debt or securities convertible into Shares of any Pledged Company and there are no Shares of any Pledged Company allotted for issuance. There is no unanimous shareholder agreement with respect to any Obligor.	
 
 	(q)	Corporate Structure. Schedule G-1 accurately sets out, as at the time immediately prior to completion of the HDS Acquisition, the corporate structure of the Companies and evidences intercorporate Share ownership. Schedule G-2 accurately sets out immediately following completion of the HDS Acquisition, the corporate structure of the Companies and evidences intercorporate Share ownership.	
 
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 	(r)	Real Property and Leases. Except as set out in the Perfection Certificates, no Secured Obligor owns any real property as at the date hereof. The Perfection Certificates contain a complete and accurate list, as at the date hereof, of all leases of real property and any amendments or additions thereto to which each Secured Obligor is a party, by which it is bound, or in respect of which it is entitled to benefit. The Borrowers have delivered or made available to the Administrative Agent if requested by the Administrative Agent, true and complete copies of each of such leases and all documents to which each Secured Obligor is a party affecting the rights or obligations of such Secured Obligor thereunder including, without limitation, any non-disturbance and recognition agreements, subordination agreements, attachment agreements and agreements regarding the term or rental of any of such leases. No Secured Obligor is in default of its material obligations thereunder nor has it delivered or received any written notice of default under any such lease (except as may have been promptly disclosed to the Administrative Agent).	
 
 	(s)	Intellectual Property. Each Obligor owns or is licensed or otherwise has the right to use all Intellectual Property that is used in the operation of their businesses without conflict with the rights of any other Person (other than any Intellectual Property the absence of which or any such conflict with respect to which would not have a Material Adverse Effect). No Obligor has received any notice of any claim of infringement or similar claim or proceeding relating to any such Intellectual Property which if determined against such Obligor could reasonably be expected to have a Material Adverse Effect. To the knowledge of each Primary Obligor, no present or former employee of an Obligor and no other Person owns or claims to own or has or claims to have any interest, direct or indirect, in whole or in part, in any of the Intellectual Property of an Obligor that could reasonably be expected to have a Material Adverse Effect.	
 
 	(t)	Employment and Labour Agreements. As of the date of this agreement, each Obligor is in compliance with the terms and conditions of all collective bargaining agreements and other labour agreements except where the failure to so comply could not reasonably be expected to have a Material Adverse Effect.	
 
 	(u)	Liens. The Liens granted to the Administrative Agent pursuant to the Security Documents are fully perfected first priority Liens in and to the Secured Assets, subject only to Permitted Liens.	
 
 	(v)	Transaction Documents. Each of the Transaction Documents is in full force and effect and is a legal, valid and binding obligation of each of the parties thereto, enforceable by such Person against each of such parties in accordance with its terms, except to the extent that the enforceability thereof may be limited by applicable bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance and other similar laws of general application limiting the enforcement of creditors’ rights generally and the fact that the courts may deny the granting or enforcement of equitable remedies. This Section 10.1(v) speaks only as of the date of the sole extension of credit under the NRT Facility and is not required or deemed to be repeated on any other date.	
 
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 	(w)	Pension and Welfare Plans.	
 
 	(i)	During the twelve consecutive month period before the date of this Agreement and before the date of any extension of credit hereunder (i) no steps have been taken to terminate or wind-up any Pension Plan (wholly or in part), which could reasonably be expected to result in an Obligor making contributions (including special payments) to the Pension Plan in any twelve month period in excess of 115% of the contributions that were scheduled to be made in the prior twelve consecutive month period, (ii) no failure to remit a contribution in accordance with the terms of any Pension Plan or pension benefits legislation has occurred with respect to any Pension Plan sufficient to give rise to a deemed trust, lien or charge under any pension benefits legislation of any jurisdiction that, individually or in the aggregate would or could reasonably be expected to have a Material Adverse Effect, (iii) no condition exists and no event or transaction has occurred with respect to any Pension Plan which could reasonably be expected to result in the incurrence by an Obligor of any fines or penalties which would or could reasonably be expected to have a Material Adverse Effect, and (iv) except as disclosed in the financial statements required to be provided pursuant to this Agreement or as otherwise disclosed in writing from time to time to the Agent, the Obligors have no contingent liability with respect to any post-retirement benefit under a Welfare Plan that, individually or in the aggregate would or could reasonably be expected to have a Material Adverse Effect.	
 
 	(ii)	Each Pension Plan is and has been established, registered, funded, invested and administered in compliance with its terms and all Applicable Laws and (i) all contributions or premiums (including employee contributions or premiums made by authorized payroll deductions or other withholdings) required to be made to the appropriate funding agent in accordance with all Applicable Laws and the terms of each Pension Plan or Welfare Plan have been made in accordance with all Applicable Laws and the terms of each Pension Plan or Welfare Plan, (ii) there have, to its knowledge after having made reasonable inquiry, been no withdrawals, applications, payments or transfers of assets from any Pension Plan or Welfare Plan or the trusts or other funding media relating thereto which have not been made or done in accordance with all Applicable Laws, (iii) as at the date of the most recent actuarial report filed with respect to the Pension Plan, all liabilities under each Pension Plan that is a registered pension plan were fully funded in accordance with Applicable Law, on a going concern and solvency basis, in accordance with the terms of the respective Pension Plans, the requirements of all Applicable Laws and applicable regulatory authorities using the methods and assumptions set out in such report, and (iv) to its knowledge, no event has occurred and no	
 
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 	condition exists with respect to any Pension Plan that has resulted or could reasonably be expected to result in any Pension Plan having its registration revoked or refused for the purposes of any Applicable Law or being placed under the administration of any relevant pension benefits regulatory authority or the Borrower being required to pay any taxes or penalties under any Applicable Law, except for any exceptions to clauses (i) through (iv) above that, individually or in the aggregate, would not and could not reasonably be expected to have a Material Adverse Effect.	
 
 	(x)	ERISA.	
 
 	(i)	Each Obligor and each other Company have operated and administered each Plan in compliance with all Applicable Law except for such instances of non-compliance as have not resulted in and are not reasonably likely to result in a Material Adverse Effect. No Obligor and no other Company has incurred any liability, including by reason of liability of any ERISA Affiliate, pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to any Plan, and no event, transaction or condition has occurred or exists that could reasonably be expected to result in the incurrence of any such liability by any Obligor or any other Company, or in the imposition of any Lien on any of the rights, properties or assets of any Obligor or any other Company, in either case pursuant to Title I or IV of ERISA or to such penalty or excise tax provisions or to section 430(k) of the Code or section 4068 of ERISA, other than such liabilities or Liens as would not be, individually or in the aggregate, have a Material Adverse Effect.	
 
 	(ii)	The present value of the aggregate benefit liabilities under each of the Plans, determined as of the end of such Plan’s most recently ended plan year on the basis of the actuarial assumptions specified for funding purposes in such Plan’s most recent actuarial valuation report, did not exceed the aggregate current value of the assets of such Plan allocable to such benefit liabilities by an amount that is reasonably likely, individually or in the aggregate, to result in a Material Adverse Effect, and no Plan is, or is expected to be, in “at risk” status (as defined in section 430 of the Code or section 303 of ERISA). The term “benefit liabilities” has the meaning specified in section 4001 of ERISA and the terms “current value” and “present value” have the meaning specified in section 3 of ERISA.	
 
 	(iii)	Each Obligor and each other Company have not incurred withdrawal liabilities (and are not subject to contingent withdrawal liabilities) under section 4201 or 4204 of ERISA in respect of Multiemployer Plans that, individually or in the aggregate, are reasonably likely to have a Material Adverse Effect, and no Multiemployer Plan is, or is expected to be, in “critical” or “endangered” status under section 432 of the Code or section 305 of ERISA.	
 
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 	(iv)	The expected postretirement benefit obligation of the Obligors and their Subsidiaries does not and is not reasonably likely to have a Material Adverse Effect.	
 
 	(v)	The execution and delivery of this agreement and the extensions of credit hereunder will not involve any transaction that is subject to the prohibitions of section 406 of ERISA or in connection with which a tax could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code.	
 
 	(vi)	No Plan has incurred a “reportable event” within the meaning of section 4043 of ERISA and the regulations issued thereunder (excluding those for which the provision for 30-day notice to the PBGC has been waived by regulations).	
 
 	(y)	Regulation T, U or X. None of the Obligors is engaged in the business of extending credit for the purpose of purchasing or carrying margin stock, and no proceeds of any credit obtained hereunder shall be used for a purpose which violates, or would be inconsistent with, Regulation T, U or X of the F.R.S. Board. Terms for which meanings are provided in Regulation T, U or X of the F.R.S. Board or any regulations substituted therefor, as from time to time in effect, are used in this Section with such meanings.	
 
 	(z)	Foreign Assets Control Regulations. Neither the execution and delivery of this agreement nor the relevant Borrowers’ use of the proceeds of the Credit Facilities will violate the Trading with the Enemy Act , as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto. Without limiting the foregoing, no Obligor nor any of its Subsidiaries (a) is or will become a Person whose property or interests in property are blocked pursuant to Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001) or (b) engages or will engage in any dealings or transactions, or be otherwise associated, with any such Person. Each Obligor and its Subsidiaries are in compliance, in all material respects, with the Title III of Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism ( USA Patriot Act of 2001 ). No part of the proceeds from the Credit Facilities will be used, directly or indirectly, for any payment to any governmental official or employee, political party, official of a political party, candidate for political office or anyone else acting in an official party capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977 , as amended.	
 
 	(aa)	Material Adverse Change. No Material Adverse Change has occurred since December 31, 2014.	
 
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 	(bb)	Solvency after Drawdown. On an unconsolidated basis, after giving effect to the consummation of the HDS Acquisition and the extension of credit under the NRT Facility and thereafter on each extension of credit hereunder,	
 
 	(i)	the assets of each Borrower shall exceed its respective liabilities, including contingent liabilities;	
 
 	(ii)	the capital of each Borrower shall not be unreasonably small to conduct its respective business; and	
 
 	(iii)	no Borrower shall have incurred debts, nor shall have intended to incur debts, beyond its respective ability to pay such debts as they mature.	
For the purpose of this Section 10.1(bb), the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that is probable to become an actual or matured liability.
 
 	(cc)	Purpose of Credit. No credit advanced to the Borrowers under the Credit Facilities and none of the other services and products to be provided by the Credit Parties to the Obligors under or in connection with the Loan Documents will be used by, on behalf of or for the benefit of any Person other than the Obligors. No Obligor is a charity registered with the Canada Revenue Agency and no Obligor solicits charitable financial donations from the public.	
 
 	(dd)	Investment Company Act of 1940. None of the Obligors, any Person controlling the Obligors, or any Subsidiary thereof, is or is required to be registered as an “investment company” under the Investment Company Act of 1940.	
 
 	(ee)	No Omissions. None of the statements of fact set forth in this Section 10.1 omits to state any fact necessary to make any such statement of fact not misleading in any material respect.	
 
10.2	Survival of Representations and Warranties.	
All of the representations and warranties of the Primary Obligors contained in Section 10.1 shall survive the execution and delivery of this agreement and shall continue until the Facilities Termination Date notwithstanding any investigation made at any time by or on behalf of the Administrative Agent or any of the Lenders.
 
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ARTICLE 11
COVENANTS
 
11.1	Affirmative Covenants.	
The applicable Primary Obligors hereby covenant and agree with the Administrative Agent and the Lenders that, until the Facilities Termination Date, and unless waived in writing in accordance with Section 14.14.
 
 	(a)	Prompt Payment. Each Primary Obligor shall, and shall cause each other Obligor to, duly and punctually pay or cause to be duly and punctually paid to each Credit Party all amounts payable by the Obligors under the Loan Documents at the times and places and in the currency and manner mentioned therein.	
 
 	(b)	Financial Reporting. The relevant Primary Obligors shall furnish the Administrative Agent with the following statements and reports (with, if requested by the Administrative Agent, sufficient copies for each Lender):	
 
 	(i)	within 120 days after the end of the 2015 Fiscal Year and within 90 days after the end of each subsequent Fiscal Year, a copy of the audited combined special purpose financial statements of Anixter Canada prepared on an Adjusted Consolidated Basis and the audited consolidated financial statements of the Ultimate Parent and the respective auditors’ reports thereon;	
 
 	(ii)	within 45 days after the end of each of the first three Fiscal Quarters of each Fiscal Year, a copy of the unaudited combined special purpose financial statements of Anixter Canada prepared on an Adjusted Consolidated Basis and the Ultimate Parent with respect thereto;	
 
 	(iii)	within 45 days after the end of each of the first three Fiscal Quarters of each Fiscal Year and within 90 days after the end of each Fiscal Year, a duly executed and completed compliance certificate, in the form attached as Schedule B hereto, evidencing compliance with the terms of this agreement as well as any updated information with respect to Schedule G, Schedule L and/or any Perfection Certificate as required pursuant to Section 11.1(n);	
 
 	(iv)	within 45 days of the beginning of each Fiscal Year, an annual budgeted income statement, balance sheet and cash flow statement of Anixter Canada prepared on an Adjusted Consolidated Basis for such Fiscal Year together with budgeted Capital Expenditures for such Fiscal Year;	
 
 	(v)	any information and documents that are within their possession, custody or control reasonably required by any Lender in order for that Lender to comply with any AML/CTF Laws; and	
 
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 	(vi)	such additional financial or operating reports or statements as the Administrative Agent may, from time to time, reasonably require including, upon request, copies of all employment, collective bargaining and other labour agreements covering any employees of any Company.	
 
 	(c)	Corporate Existence. Subject to the provisos in Section 11.3(c), each Primary Obligor shall, and shall cause each other Obligor to, preserve and maintain its legal existence in good standing and shall, and shall cause each other Obligor to, qualify and remain duly qualified to carry on business and own property in each jurisdiction in which failure to maintain such qualification would have a Material Adverse Effect.	
 
 	(d)	Conduct of Business. Each Primary Obligor shall, and shall cause each other Obligor to, conduct its business in such a manner so as to comply in all respects with all Applicable Law (including, without limitation, ERISA, the USA Patriot Act, AML/CTF Laws, Environmental Laws and laws relating to the discharge, spill, disposal or emission of Hazardous Materials), so as to observe and perform in all respects all its obligations under leases, licences and agreements necessary for the proper conduct of its business and so as to preserve and protect its property and assets and the earnings, income and profits therefrom except where failure to do so could not reasonably be expected to have a Material Adverse Effect. Each Primary Obligor shall, and shall cause each other Obligor to, ensure that any breaches of the said obligations and the consequences of any such breach shall be promptly remedied. Each Primary Obligor shall, and shall cause each other Obligor to, obtain and maintain all licenses, permits, government approvals, franchises, authorizations and other rights necessary for the operation of its business except where failure to do so could not reasonably be expected to have a Material Adverse Effect.	
 
 	(e)	Use of Proceeds. The Borrowers shall apply all of the proceeds obtained under the RT Facility (i) to refinance in its entirety the Credit Facility (as defined in the Existing Credit Agreement), (ii) to partially finance the HDS Acquisition and (iii) otherwise to finance the Borrowers’ general corporate purposes and working capital requirements. Anixter Canada shall apply all of the proceeds obtained under the NRT Facility to partially finance the HDS Acquisition and for general corporate purposes.	
 
 	(f)	Interest Coverage Ratio. Anixter Canada shall at all times cause the Borrowing Group to maintain the Interest Coverage Ratio (measured at the end of each Fiscal Quarter) for each Fiscal Quarter at greater than or equal to 3.00 to 1.	
 
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 	(g)	Total Leverage Ratio. Anixter Canada shall at all times cause the Borrowing Group to maintain the Total Leverage Ratio (measured at the end of each Fiscal Quarter):	
 
 	(i)	as at the Closing Date (after giving effect to the HDS Acquisition) and for each subsequent Fiscal Quarter up to and including the end of the 2016 Fiscal Year, at less than or equal to 4.25 to 1;	
 
 	(ii)	for each subsequent Fiscal Quarter up to and including the end of the 2017 Fiscal Year, at less than or equal to 3.75 to 1; and	
 
 	(iii)	for each subsequent Fiscal Quarter, at less than or equal to 3.25 to 1.	
 
 	(h)	Insurance. The Borrowers shall maintain, and shall cause each other Secured Obligor to maintain, on an individual or aggregate basis, with financially sound and reputable insurers, insurance with respect to the properties and business of the Borrowers and the other Secured Obligors against loss, damage, risk or liability on terms which are reasonable in relation to the Secured Assets (subject to the amount of such deductibles as are reasonable and normal in the circumstances). The Borrowers shall cause the Administrative Agent to be named in each such policy to the extent such policy relates to the Secured Assets as secured party or mortgagee and lender’s loss payee and additional insured, as appropriate, in a manner acceptable to the Administrative Agent. The Borrowers shall give not less than thirty (30) days’ prior written notice to the Administrative Agent in the event of cancellation of the policy for any reason whatsoever. All premiums for such insurance shall be paid by the Borrowers or another Secured Obligor, as the case may be, when due, and certificates of insurance and, if requested, photocopies of the policies shall be delivered to the Administrative Agent. The Borrowers shall promptly notify the Administrative Agent of any loss, damage, or destruction to the Secured Assets, whether or not covered by insurance, in excess of $2,000,000. In the absence of any Default but subject always to Section 9.3, the Borrowers shall have the right to determine, whether and to what extent such proceeds shall be used for repair or replacement. If, however, any Default shall be continuing, the Majority Lenders may determine, in their sole discretion, whether such proceeds shall be used for repair or replacement.	
 
 	(i)	Taxes. Each Primary Obligor shall, and shall cause each other Obligor to, pay all material taxes, rates, government fees and dues levied, assessed or imposed upon it and upon its property or assets or any part thereof, as and when the same become due and payable (save and except when and so long as the validity of any such taxes, rates, fees, dues, levies, assessments or imposts is being contested in good faith by appropriate proceedings and adequate reserves shall have been set aside in the books of such Obligor or such other Obligor, as the case may be), and such Obligor shall, and shall cause each other Obligor to, deliver to the Administrative Agent, when requested, written evidence of such payments.	
 
 	(j)	Reimbursement of Expenses. The Borrowers shall (i) reimburse the Credit Parties, on demand, for all reasonable out-of-pocket costs, charges and expenses incurred by or on behalf of the Credit Parties (including, without limitation, the reasonable fees, disbursements and other charges of one primary counsel and any local or special counsel to the Credit Parties) in connection with the negotiation,	
 
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 	preparation, execution, delivery, syndication, participation, administration and interpretation of the Loan Documents and the closing documentation ancillary to the completion of the transactions contemplated hereby and thereby and any amendments and waivers hereto and thereto (whether or not consummated or entered into), the charges of Intralinks and any lien search fees and lien registration fees and (ii) reimburse the Credit Parties, on demand, for all reasonable out-of-pocket costs, charges and expense incurred by or on behalf of any of them (including the fees, disbursements and other charges of counsel) in connection with the enforcement of the Loan Documents.	
 
 	(k)	Notices.	
Each Primary Obligor shall promptly notify the Administrative Agent:
 
 	(i)	of the occurrence of any Default and the action which such Primary Obligor proposes to take or has taken with respect thereto;	
 
 	(ii)	of the occurrence of any breach or non-performance of any obligation of any party to a Transaction Document which could reasonably be expected to result in a claim for an indemnity payment thereunder in respect of the HDS Acquisition; and	
 
 	(iii)	of any matter including (A) breach or non-performance of, or any default under, a contractual obligation of any Obligor; (B) any dispute, litigation, investigation, proceeding or suspension of or before any Official Body affecting an Obligor; or (C) the commencement of, or any material development in, any litigation or proceeding affecting an Obligor, in each case which has resulted or is reasonably likely to result in a Material Adverse Effect.	
Each notice under this Section shall be accompanied by a written statement by a senior officer of the applicable Primary Obligor setting forth details of the occurrence referred to therein, and stating what action such Borrower proposes to take with respect thereto and at what time. Each notice under clause (i) above shall describe with particularity any and all clauses or provisions of this agreement or other Loan Document that have been (or foreseeably will be) breached or violated.
 
 	(l)	Inspection of Assets and Operations. Each Borrower shall, and shall cause each other Secured Obligor to, permit representatives of the Administrative Agent to inspect the Secured Assets and for that purpose to enter on any Property where any of the Secured Assets may be situated; provided, however, if no Event of Default has occurred and is continuing, inspection may only occur once in any twelve month period and must take place during reasonable business hours and on reasonable notice.	
 
 	(m)	Books and Records. Each Primary Obligor shall, and shall cause each other Obligor to, keep proper books of account and records covering all its business and	
 
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 	affairs on a current basis, make full, true and correct entries of its transactions in such books, set aside on its books from its earnings all such proper reserves as required by generally accepted accounting principles and permit representatives of the Administrative Agent and the Lenders to inspect such books of account, records and documents and to discuss the affairs, finances and accounts of each Primary Obligor or each other Obligor with the officers of each Primary Obligor or such other Obligor; provided, however, if no Event of Default has occurred and is continuing, inspection may only occur once in any twelve month period and must take place during reasonable business hours and on reasonable notice. Each Primary Obligor shall, and shall cause each other Obligor to, at any time that a Default has occurred and is continuing, permit representatives of the Administrative Agent and the Lenders to make copies of all of the aforesaid records, books of account and documents and to discuss the affairs, finances and accounts of each Primary Obligor or each other Obligor with their auditors.	
 
 	(n)	Change in Information. If any material information contained in Schedule G, Schedule L and/or any Perfection Certificate shall change, the Borrowers shall notify the Administrative Agent in writing of the details of such change at the time of the next delivery by the Borrowers to the Administrative Agent pursuant to Section 11.1(b)(iii) and Schedule G, Schedule L and/or any Perfection Certificate, as the case may be, shall thereupon be deemed to be amended accordingly.	
 
 	(o)	Change of Name or Jurisdiction of Incorporation. If any Secured Obligor changes its corporate name, adopts a French form of name or changes its jurisdiction of incorporation or the jurisdiction of its location for the purposes of Section 7(4) of the PPSA, the Borrowers shall promptly notify the Administrative Agent in writing of the details of such change or adoption and the applicable Perfection Certificate, as the case may be, shall thereupon be deemed to be amended accordingly.	
 
 	(p)	Environmental Compliance. Each Borrower shall, and shall cause each other Obligor to:	
 
 	(i)	use and operate all of its facilities and properties in compliance with all Environmental Laws applicable to such facilities and properties, keep all permits, approvals, certificates, licenses and other authorizations relating to environmental matters and necessary for the operation of its business in effect and remain in material compliance therewith, and handle all Hazardous Materials in material compliance with all applicable Environmental Laws, except in each case where failure to do so could not reasonably be expected to have a Material Adverse Effect;	
 
 	(ii)	permit the Administrative Agent and/or the Lenders to conduct inspections, audits and appraisals of all or any of the records, business and assets of such Borrower or such other Obligor at any time and from time	
 
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 	to time to ensure material compliance with applicable Environmental Laws; provided, however, if no Event of Default has occurred and is continuing, inspection may only occur once in any twelve month period and must take place during reasonable business hours and on reasonable notice, and environmental audits and appraisals may only be required with reasonable cause;	
 
 	(iii)	promptly notify the Administrative Agent and provide copies upon receipt of all adverse written claims, complaints, notices or inquiries relating to the condition of its facilities and properties or compliance with Environmental Laws which could reasonably be expected to have a Material Adverse Effect, and take commercially reasonable efforts to promptly cure, have dismissed or otherwise resolved to the satisfaction of the Lenders any actions and proceedings relating to any such compliance with Environmental Laws, except for those being diligently contested in good faith and by appropriate proceedings and for which adequate reserves in accordance with generally accepted accounting principles shall have been set aside on its books; and	
 
 	(iv)	provide such information and certifications which the Administrative Agent may reasonably request from time to time to evidence compliance with the foregoing.	
 
 	(q)	ERISA. The Primary Obligors shall, and shall cause each other relevant Subsidiary thereof to, deliver to the Administrative Agent, promptly and in any event within ten Banking Days after the relevant Subsidiary becoming aware of any of the following, a written notice setting forth the nature thereof and the action, if any, that any Subsidiary or an ERISA Affiliate proposes to take with respect thereto:	
 
 	(i)	with respect to any Plan, any “reportable event”, as defined in section 4043(c) of ERISA and the regulations thereunder, for which the 30-day notice thereof has not been waived pursuant to such regulations as in effect on the date hereafter; or	
 
 	(ii)	the taking by the PBGC of steps to institute, or the threatening by the PBGC of the institution of, proceedings under section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by such member or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan; or	
 
 	(iii)	any event, transaction or condition that is reasonably likely to result in the incurrence of any liability by such member or any ERISA Affiliate pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans, or in the imposition of any Lien on any of the rights, properties or assets of such member or any ERISA Affiliate pursuant to Title I or IV of ERISA or such penalty or excise tax provisions; or	
 
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 	(iv)	receipt of notice of the imposition of a financial penalty (which for this purpose shall mean any tax, penalty or other liability, whether by way of indemnity; or otherwise) with respect to one or more Non-U.S. Plans and which would have a Material Adverse Effect;	
 
 	(v)	upon the reasonable request of the Administrative Agent, copies of documents described in Sections 101(k) or 101(l) of ERISA that any Company or any ERISA Affiliate has received from any Multiemployer Plan with respect to such Multiemployer Plan;	
 
 	(vi)	within 10 days after the due date for filing with the PBGC pursuant to section 430(k) of the Code of a notice of failure to make a required installment or other payment with respect to a Plan, or within 10 days of a failure to make by its due date a required installment under section 430(j) of the Code, a statement of a financial officer setting forth details as to such failure and the action proposed to be taken with respect thereto, together with a copy of such notice given to the PBGC, if applicable, but only if such failure to make a required installment would result in a Material Adverse Effect; or	
 
 	(vii)	promptly and in any event within 15 Banking Days after the filing or receipt thereof, a copy of any other report or notice that any Borrower or any ERISA Affiliate files under ERISA or the Code with the Internal Revenue Service, the PBGC or the U.S. Department of Labour with respect to any Plan or Multiemployer Plan, or receives from the Internal Revenue Service, the PBGC or the U.S. Department of Labour or from any Multiemployer Plan, if such report or notice concerns an event or action that would result in a Material Adverse Effect.	
 
 	(r)	Intellectual Property.	
 
 	(i)	Each Primary Obligor shall promptly notify the Administrative Agent if it knows or has reason to know that any item of Intellectual Property that is material to the business of any Obligor or otherwise of material value may become, in the case of Intellectual Property owned by such Obligor (A) abandoned or dedicated to the public or placed in the public domain, or (B) invalid or unenforceable, or (C) subject to any adverse determination or development regarding such Obligor’s ownership, registration or use or the validity or enforceability of such item of Intellectual Property (including the institution of, or any adverse development with respect to, any action or proceeding in the Canadian Intellectual Property Office, the United States Patent and Trademark Office, the United States Copyright Office, any state registry, any foreign counterpart of the foregoing, or any court), or (D) the subject of any reversion or termination rights.	
 
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 	(ii)	In the event that any Intellectual Property that is material to the business of any Obligor or otherwise of material value and that is owned by or exclusively licensed to any Obligor is infringed, misappropriated, diluted or otherwise violated by a third party, the Primary Obligors shall, and shall cause the other Obligors to, promptly take all commercially reasonable actions to stop such infringement, misappropriation, dilution or other violation and protect its rights in such Intellectual Property including, but not limited to, the initiation of a suit for injunctive relief and to recover damages.	
 
 	(iii)	Each Primary Obligor shall take all commercially reasonable steps necessary to protect the Intellectual Property of the Obligors and the secrecy of all Trade Secrets of the Obligors, including, without limitation, entering into confidentiality agreements with employees and consultants and labeling and restricting access to secret information and documents if doing so is commercially reasonable.	
 
 	(s)	Additional Guarantors. Forthwith following the formation or acquisition of a Material Canadian Subsidiary or upon a Subsidiary becoming a Material Canadian Subsidiary (but, subject to the last sentence of this Section 11.1(s) in any event no later than 60 days following such formation, acquisition or change in status):	
 
 	(A)	Anixter Canada shall forthwith cause such Subsidiary to duly execute and deliver to the Administrative Agent a Guarantee and one or more Security Documents, as necessary, for the purpose of charging all of its present and after-acquired property in favour of the Administrative Agent;	
 
 	(B)	Anixter Canada shall forthwith deliver, or cause to be delivered to, the Administrative Agent, in form and substance satisfactory to the Administrative Agent:	
 
 	(I)	a duly certified copy of the articles of incorporation or similar documents and by-laws of such Subsidiary;	
 
 	(II)	a certificate of status or good standing for such Subsidiary issued by the appropriate governmental body or agency of the jurisdiction in which such Subsidiary is incorporated;	
 
 	(III)	a duly certified copy of the resolution of the board of directors of such Subsidiary authorizing it to execute, deliver and perform its obligations under each Loan Document to which such Subsidiary is a signatory and a duly certified copy of the resolution of the board of directors (if required under the constating documents or by-laws of such Subsidiary) of such Subsidiary authorizing the	
 
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 	pledge of all of its issued and outstanding shares to the Administrative Agent and any subsequent disposition thereof by the Administrative Agent in realizing on the security therein constituted by the relevant Security Documents;	
 
 	(IV)	a certificate of an officer of such Subsidiary, in such capacity, setting forth specimen signatures of the individuals authorized to sign the Guarantee and Security Documents to which such Subsidiary is a signatory;	
 
 	(V)	all documents and other evidence reasonably requested by the Administrative Agent in order for them to identify the Subsidiary and to carry out all necessary checks to comply with AML/CTF Laws;	
 
 	(VI)	a Perfection Certificate of such Subsidiary in form and substance satisfactory to the Administrative Agent;	
 
 	(VII)	share certificates representing all of the issued and outstanding shares of such Subsidiary, in each case duly endorsed in blank for transfer or attached to duly executed stock transfers and powers of attorney;	
 
 	(VIII)	an opinion of such Subsidiary’s counsel addressed to the Lenders, the Administrative Agent and its counsel, relating to the status and capacity of such Subsidiary, the due authorization, execution and delivery and the validity and enforceability of the Guarantee by virtue of its execution of the Guarantee in the jurisdiction of incorporation of such Subsidiary and in the Province of Ontario and such other matters as the Administrative Agent may reasonably request; and	
 
 	(IX)	an opinion of the Administrative Agent’s counsel with respect to such matters as may be reasonably required by the Administrative Agent in connection with such Subsidiary (including, without limitation, the legality, validity and binding nature of the obligations of such Subsidiary under, and the enforceability against such Subsidiary of, the Loan Documents which are governed by the laws of the Province of Ontario);	
 
 	(C)	Anixter Canada shall forthwith cause such additional Security Documents or amendments to existing Security Documents to be executed and delivered to permit the pledge of the shares of such Subsidiary;	
 
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 	(D)	the Administrative Agent and its counsel shall be satisfied, acting reasonably, that all necessary approvals, acknowledgements, directions and consents have been given and that all relevant laws have been complied with in respect of all agreements and transactions referred to herein; and	
 
 	(E)	all documents and instruments shall have been properly registered, recorded and filed in all places which, searches shall have been conducted in all jurisdictions which, and deliveries of all consents, approvals, acknowledgements, undertakings, directions, negotiable documents of title and other documents and instruments to the Administrative Agent shall have been made which, in the opinion of the Administrative Agent’s counsel, acting reasonably, are desirable or required to make effective the Security created or intended to be created pursuant to, and to ensure the perfection and the intended first-ranking priority of such Security subject to Permitted Liens;	
whereupon such Subsidiary shall become an Additional Guarantor for all purposes of this agreement. Notwithstanding the first sentence of this Section 11.1(s), Anixter Canada shall, on the date of the initial drawdown hereunder, comply with this provision in respect of the Target and all subsidiaries thereof which are Material Canadian Subsidiaries.
 
 	(t)	Additional Borrower. As a condition of any Subsidiary of Anixter Canada becoming a borrower under this Agreement from time to time, Anixter Canada shall cause such Subsidiary to execute and deliver to the Administrative Agent an instrument of adhesion in the form set forth in Schedule J hereto and Anixter Canada shall have complied with Section 11.1(s) in respect of such Subsidiary with the sole exception that the Guarantee referenced in Section 11.1(s)(A) shall not be required to be executed and delivered by such Subsidiary.	
 
 	(u)	Intercompany Indebtedness. The Primary Obligors shall cause all Indebtedness owing by any Obligor to the Ultimate Parent or any direct or indirect Subsidiary thereof (other than another Obligor) to be subordinated and postponed, pursuant to the Postponement and Subordination Agreement, to the Obligations of such Obligor for so long as a Default has occurred and is continuing. The Primary Obligors shall cause any such direct or indirect Subsidiary of the Ultimate Parent (other than another Obligor), prior to the incurrence of any such Indebtedness, to execute and deliver to the Administrative Agent the Postponement and Subordination Agreement or an instrument of adhesion thereto.	
 
 	(v)	Keepwell. Each Primary Obligor jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Obligor to honour all of its obligations under its Guarantee in respect of Capital Market Obligations	
 
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 	(provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 11.1(v) for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 11.1(v), or otherwise under its Guarantee voidable under Applicable Law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section 11.1(v) shall remain in full force and effect until discharged in accordance with the provisions of its Guarantee. Each Qualified ECP Guarantor intends that this Section 11.1(v) constitute, and this Section 11.1(v) shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Obligor for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.	
 
11.2	Performance of Covenants by Administrative Agent.	
The Administrative Agent may, on the instructions of the Majority Lenders and upon notice by the Administrative Agent to the applicable Primary Obligor, perform any covenant of such Primary Obligor under this agreement which such Primary Obligor fails to perform or cause to be performed and which the Administrative Agent is capable of performing, including any covenants the performance of which requires the payment of money, provided that the Administrative Agent shall not be obligated to perform any such covenant on behalf of such Primary Obligor (unless so instructed by the Majority Lenders) and no such performance by the Administrative Agent shall require the Administrative Agent to further perform such Primary Obligor’s covenants or shall operate as a derogation of the rights and remedies of the Administrative Agent or the Lenders under this agreement or as a waiver of such covenant by the Administrative Agent or the Lenders. Any amounts paid by the Administrative Agent as aforesaid shall be reimbursed by the Lenders in their Pro Rata Shares and shall be repaid by the applicable Primary Obligor to the Administrative Agent on behalf of the Lenders on demand.
 
11.3	Restrictive Covenants.	
Each Borrower hereby covenants and agrees with the Administrative Agent and the Lenders that, until the Facilities Termination Date, and unless waived in writing in accordance with Section 14.14:
 
 	(a)	Liens. The Borrowers shall not, and shall not suffer or permit any other Company to, enter into or grant, create, assume or suffer to exist any Lien affecting any property or assets of the Companies other than Permitted Liens.	
 
 	(b)	Indebtedness. The Borrowers shall not, and shall not suffer or permit any other Company to, incur, assume or otherwise permit any Indebtedness other than Permitted Indebtedness.	
 
 	(c)	Corporate Existence. The Borrowers shall not, and shall not suffer or permit any other Secured Obligor to, take part in any consolidation, amalgamation, merger, winding-up, dissolution, capital or corporate reorganization or similar proceeding or arrangement; provided, however, that the foregoing shall not prohibit any such transaction solely between two or more members of the	
 
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 	Borrowing Group provided should one such member be a Secured Obligor prior to such transaction, the resulting entity shall be a Secured Obligor provided (w) notice of such transaction (and reasonable details thereof) has been provided by the Borrowers to the Administrative Agent at least ten Banking Days before the proposed implementation date of such transaction, (x) at the time of the delivery of the aforesaid notice by the Borrowers to the Administrative Agent, the Borrowers deliver to the Administrative Agent a certificate certifying that the implementation of such transaction will not have a Material Adverse Effect, (y) the Borrowers shall deliver or cause to be delivered to the Administrative Agent, contemporaneously with the completion of such transaction, all share certificates of Pledged Companies, certificates, opinions and other things as the Administrative Agent may reasonably request to ensure that the completion of such transaction shall not adversely affect any rights of the Administrative Agent or any of the Lenders under any Guarantee or any Security Document and (z) no Default has occurred and is continuing at the time of such proposed transaction and no Default would arise immediately thereafter. Upon compliance by the Borrowers with the provisions in this Section 11.3(c) with respect to any such transaction between two or more members of the Borrowing Group, the Borrowers shall deliver a revised Schedule G reflecting such transaction and, upon receipt thereof, Schedule G hereof shall be deemed to be amended accordingly.	 	
 
 	(d)	Change in Business. The Borrowers shall not suffer or permit any Secured Obligor engage to any material extent in, any business other than businesses of the type conducted by the Ultimate Parent and its Subsidiaries on the date hereof, business of the type proposed to be conducted in connection with and following the consummation of the HDS Acquisition, and businesses in substantially similar or related businesses thereto and reasonable extensions thereof.	
 
 	(e)	Capital of Borrowers. The Borrowers shall not, and shall not suffer or permit any other member of the Borrowing Group to, issue any Shares unless such Shares are issued to an Obligor, another Person that is a shareholder of the issuer as of the date of this agreement or, in the case of Anixter Mid Holdings, another Subsidiary of the Ultimate Parent.	
 
 	(f)	Amendments. Subject to Section 11.3(c), no Borrower shall, or shall suffer or permit any other Secured Obligor to, enter into any amendment of its articles of incorporation (i) that would reasonably be considered to prejudice the rights or interests of the Administrative Agent or the Lenders under or in connection with the Loan Documents, or (ii) without promptly providing a copy of the amendment to the Administrative Agent.	
 
 	(g)	Investments. The Borrowers shall not, and shall not permit any of the other Secured Obligors to, make any Investments other than Permitted Investments.	
 
 	(h)	Acquisitions. The Borrowers shall not, and shall not suffer or permit any other Secured Obligors to, make any Acquisitions other than Permitted Acquisitions.	
 
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 	(i)	Fiscal Year. No Obligor shall change its Fiscal Year end.	
 
 	(j)	Capital Market Agreements. The Borrowers shall not, and shall not suffer or permit any other Company to, enter into any Capital Market Agreements for speculative purposes or on a margined basis.	
 
 	(k)	Transactions with Affiliates. The Borrowers shall not, and shall not suffer any Secured Obligor to, enter into any transaction including, without limitation, any management or consulting agreement, with any Affiliate of a Borrower, except on arm’s length and commercially reasonable terms.	
 
 	(l)	Distributions. At any time prior to the NRT Obligations Termination Date, the Borrowers shall not, and shall not suffer or permit any of the other Secured Obligors to, make any Distributions other than Permitted Distributions.	
 
 	(m)	Disposition of Secured Assets. The Borrowers shall not, and shall not suffer or permit any of the other Companies to, directly or indirectly, sell, assign, lease, convey, transfer or otherwise dispose of (whether in one or a series of transactions) any of their property, assets or undertaking or enter into any agreement to do any of the foregoing except:	
 
 	(i)	dispositions of inventory, or used, worn-out or surplus property, all in the ordinary course of business;	
 
 	(ii)	the sale of equipment to the extent that such equipment is exchanged for credit against the purchase price of other equipment;	
 
 	(iii)	the sale of assets pursuant to a sale leaseback transactions not otherwise prohibited pursuant to Section 11.3(o);	
 
 	(iv)	dispositions or transfers of assets by a Company to a Secured Obligor; or	
 
 	(v)	disposition of assets (other than those referred to in Sections 11.3(m)(i)-(iii), inclusive)) or sales of shares or units of any Company (other than a Pledged Company) provided that:	
 
 	(A)	the net aggregate proceeds of all such sales by the Companies shall not exceed $25,000,000 or the Exchange Equivalent thereof during the period from and including the Closing Date to and including the Maturity Date;	
 
 	(B)	the consideration received reflects the fair market value of the property sold;	
 
 	(C)	no less than 75% of the consideration for any particular disposition or sale is for Cash; and	
 
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 	(D)	no Default exists at the time of such disposition or would arise immediately thereafter as a result of such disposition.	
Notwithstanding the foregoing, the Borrowers shall not, and shall not suffer any Company to, effect any securitization of receivables.
 
 	(n)	Restrictive Agreements. The Borrowers shall not, and shall not suffer or permit any other Company to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon the ability of any Company, (i) to pay dividends or make other distributions to any other Secured Obligor with respect to its Shares, (ii) to pay any Indebtedness owed to any other Secured Obligor, (iii) to make or permit to exist loans or advances to any other Secured Obligor, (iv) to make any payments to the Credit Parties, or provide security or perform or observe any of its other covenants and agreements, as and when required hereunder; or (v) to sell transfer, lease or otherwise dispose of any of its properties or assets to any other Secured Obligor; provided that the foregoing shall not apply to restrictions and conditions imposed by law or by this agreement.	
 
 	(o)	Sale and Leaseback. The Borrowers shall not, and will not allow the other Companies, to enter into any arrangement with any Person providing for the leasing by any Company, in each case, as lessee, of property which has been or is to be sold or transferred by such Company to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or the lease obligation of such Company except to the extent that such arrangement constitutes Permitted Indebtedness or the arrangement relates to real or immovable property acquired in a Permitted Acquisition not more than 18 months before the completion of the arrangement.	
 
 	(p)	Use of Proceeds. The Borrowers shall not, and shall not suffer or permit any Obligor or other Company to, use any of the proceeds under either Credit Facility (i) for business activities in any Sanctioned Countries or with Sanctioned Persons or (ii) for Sanctioned Activities.	
 
11.4	Deposit Arrangements and Subordinate Debt Documents.	
Notwithstanding any other term of this agreement or any other Loan Document, the Ultimate Parent and its Subsidiaries may (a) continue to operate their deposit and related arrangements with Bank Mendes Gans N.V. (or any successor to it) on substantially the basis on which they are operated at the date of this agreement as disclosed to the Administrative Agent and (b) make payments under and otherwise perform the terms of the Subordinate Debt Documents in accordance with their respective terms, except as limited by any applicable Postponement and Subordination Agreement, in each case as long as no Event of Default has occurred and is continuing.
 
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ARTICLE 12
CONDITIONS PRECEDENT TO OBTAINING CREDIT
 
12.1	Conditions Precedent to All Credit.	
The obligation of the Lenders to extend credit under any of the Credit Facilities is subject to fulfilment of the following conditions precedent at the time such credit is extended:
 
 	(a)	no Default has occurred and is continuing or would arise immediately after giving effect to or as a result of such extension of credit;	
 
 	(b)	the applicable Borrower shall have complied with the requirements of Article 4, Article 5 or Article 6, as the case may be, in respect of the relevant credit; and	
 
 	(c)	other than in connection with the sole extension of credit under the NRT Facility and the initial extension of credit under the RT Facility, the representations and warranties of the Obligors contained in the Loan Documents shall be true and correct on the date such credit is made available as if such representations and warranties were made on such date except to the extent the same expressly relate to an earlier date.	
 
12.2	Conditions Precedent to Effectiveness of Agreement.	
This agreement shall become effective upon, and the obligations of the Lenders to extend the sole extension of credit under the NRT Facility and the initial extension of credit under the RT Facility is subject to, the fulfillment of the following conditions precedent:
 
 	(a)	the conditions precedent set forth in Sections 12.1(a) and (b) have been fulfilled, except to the extent that a Default has occurred by reason of a representation or warranty other than a Specified Representation being incorrect when made or furnished;	
 
 	(b)	the Specified Representations shall be true and correct, and the Purchase Agreement Representations shall be true and correct, except to the extent that the truthfulness and accuracy of any such Purchase Agreement Representation does not constitute a condition precedent to the purchaser’s obligation to close under the Purchase Agreement, in each case on the date such credit is made available as if such representations and warranties were made on such date except to the extent the same expressly relate to an earlier date;	
 
 	(c)	the Loan Documents and other documents referenced in Schedule H, in form and substance satisfactory to the Lenders, shall have been executed and delivered by each party thereto;	
 
 	(d)	each relevant Subsidiary of Anixter Canada has executed and delivered to the Administrative Agent the Postponement and Subordination Agreement, in form and substance satisfactory to the Administrative Agent, and any other documents in connection therewith as the Administrative Agent may require;	
 
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 	(e)	there shall exist no pending or threatened litigation, legal proceedings or investigations which contest, enjoin or restrict the consummation of the subject financing and which could reasonably be expected to have a Material Adverse Effect;	
 
 	(f)	the Administrative Agent and its counsel shall be satisfied, acting reasonably, that all necessary approvals, acknowledgements, directions and consents have been given and that all relevant laws have been complied with in respect of all agreements and transactions referred to herein including, without limitation, in connection with the HDS Acquisition;	
 
 	(g)	nothing shall have occurred (nor shall any Lender become aware of any facts not previously known) which the Lenders shall determine is reasonably likely to have a material adverse effect on:	
 
 	(i)	the business, property, assets, liabilities or condition (financial or otherwise) of the Ultimate Parent, the Parent or the Obligors, taken as a whole, since December 31, 2014;	
 
 	(ii)	the rights and remedies of the Administrative Agent or the Lenders under the Loan Documents; or	
 
 	(iii)	the ability of the Obligors, taken as a whole, to perform their obligations under the Loan Documents;	
 
 	(h)	the Administrative Agent has received, in form and substance satisfactory to the Lenders:	
 
 	(i)	a duly certified copy of the articles of incorporation and by-laws (or analogous organizational documents) of each Obligor;	
 
 	(ii)	a duly certified resolution of the board of directors of each Obligor authorizing it to execute, deliver and perform its obligations under the Loan Documents to which such Obligor is a party and, in the case of any Obligor whose Shares are pledged to the Administrative Agent pursuant to a Security Document, authorizing such pledge and any subsequent disposition thereof by the Administrative Agent in realizing on the security therein constituted by the relevant Security Documents;	
 
 	(iii)	a copy of a resolution duly passed by the shareholder of Anixter Mid Holdings authorizing Anixter Mid Holdings to execute, deliver and perform the Loan Documents to which Anixter Mid Holdings is a party;	
 
 	(iv)	a copy of a resolution of the members of Eurinvest Coopertief U.A. authorizing Eurinvest Coopertief U.A. to execute and deliver the Security Document reference at Schedule H, paragraph II(5);	
 
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 	(v)	a certificate of a senior officer of each Obligor setting forth specimen signatures of the individuals authorized to sign Loan Documents on behalf of such Obligor;	
 
 	(vi)	a certificate of status or good standing (or equivalent) for each Obligor (where available), issued by the appropriate governmental body or agency of the jurisdiction in which such Obligor is incorporated or formed;	
 
 	(vii)	a certificate of a senior officer of each Borrower certifying that no Default has occurred and is continuing or would occur or arise immediately after this agreement becomes effective;	
 
 	(viii)	a compliance certificate, substantially in the form attached as Schedule B hereto (but excluding calculation of the Interest Coverage Ratio) demonstrating a maximum Total Leverage Ratio of 3.75 to 1 (calculated on a pro forma basis after accounting for the sole drawdown under the NRT Facility) with respect to the most recent Fiscal Quarter for which Anixter Canada’s financial statements have been completed, which compliance certificate shall be calculated, as concerns the Target and its Canadian Subsidiaries, by using the financial performance of the Target and its Canadian Subsidiaries for the most recent Fiscal Quarter for which the Target’s financial statements have been completed , with such financial performance for such Fiscal Quarter calculated in accordance with the methodology employed in the definition of Total Leverage Ratio;	
 
 	(ix)	a certificate of a senior officer of Anixter Canada certifying that the aggregate Borrowing Group EBITDA, calculated on a pro forma basis inclusive of the Target and its Canadian Subsidiaries, for the most recently completed four consecutive Fiscal Quarters for which Anixter Canada’s financial statements have been completed, was no less than US$72,400,000;	
 
 	(x)	opinions of legal counsel to the Obligors with respect to, inter alia , the Obligors, the enforceability of the Loan Documents and as to such other matters as the Lenders may reasonably request, and otherwise in form and substance satisfactory to the Administrative Agent;	
 
 	(xi)	certified copies of the Transaction Documents and the Intercompany Notes;	
 
 	(xii)	certificates representing all of the issued and outstanding Shares of each Pledged Company (where certificated), in each case duly endorsed in blank or accompanied by an executed stock transfer power of attorney;	
 
 	(xiii)	evidence satisfactory to the Lenders that the Buyer (as defined in the Purchase Agreement) and Anixter Canada have sufficient liquidity to pay the Base Purchase Price (as defined in the Purchase Agreement);	
 
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 	(xiv)	all conditions precedent to completing the HDS Acquisition have been satisfied in accordance with the terms and conditions of the Purchase Agreement other than payment of the Base Purchase Price, without any conditions precedent in favour of Anixter Canada thereunder having been amended or waived (unless in accordance with this Section 12.2(h)(xiv)). Anixter Canada shall not enter into any amendment or modification of, or grant any waiver or consent under, the Purchase Agreement to the extent any such modification, amendment, consent or waiver that is materially adverse to the interest of the Lenders, acting reasonably, has not been consented to by the Lenders;	
 
 	(xv)	certificates of insurance and statements of coverage with respect to the insurance referred to in Section 11.1(h); and	
 
 	(xvi)	all documents and other evidence reasonably requested by the Lenders in order for them to identify the Obligors and to carry out all necessary checks to comply with AML/CTF Laws, delivered sufficiently in advance for each Lender to complete such identification;	
 
 	(i)	the Lenders shall have completed and be satisfied with their legal and financial due diligence review of the Obligors, the Target and the Purchase Agreement;	
 
 	(j)	each member of the Borrowing Group and the Ultimate Parent (and/or its Subsidiaries, as applicable) shall have executed and delivered shared services and/or consents in form and substance satisfactory to the Lenders, acting reasonably, for the purpose of ensuring the Borrowing Group’s ability to operate on an independent basis, and Anixter Canada shall have delivered to the Administrative Agent certified true copies of each such agreement;	
 
 	(k)	all documents and instruments shall have been properly registered, recorded and filed in all places which, searches shall have been conducted in all jurisdictions which, and deliveries of all consents, approvals, acknowledgements, undertakings and non-disturbance agreements contemplated herein, directions, negotiable documents of title, ownership certificates and other documents and instruments to the Administrative Agent shall have been made which, in the opinion of the Administrative Agent’s counsel, are desirable or required to make effective the Security created or intended to be created by the Obligors in favour of the Administrative Agent pursuant to the Security Documents and to ensure the perfection and the intended priority of the Security;	
 
 	(l)	subject to Section 12.4, all outstanding Indebtedness under the Existing Credit Agreement shall have been irrevocably repaid in full and all Loan Documents (for the purpose of this Section 12.2(l) only, as defined in the Existing Credit Agreement) shall have been terminated; and	
 
 	(m)	the Borrowers shall have paid all fees and expenses due and payable pursuant to the Loan Documents.	
 
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12.3	Waiver.	
The terms and conditions of Sections 12.1 and 12.2 are inserted for the sole benefit of the Administrative Agent and the Lenders, and the Lenders may waive such terms and conditions in accordance with Section 14.14, in whole or in part, with or without terms or conditions, without prejudicing their right to assert the terms and conditions of Sections 12.1 and 12.2 in whole or in part in respect of any subsequent extension of credit.
 
12.4	Existing Letters of Credit.	
The parties hereto acknowledge and agree that, contemporaneously with the fulfilment of the conditions precedent set forth in Section 12.2, the Existing Letters of Credit shall be deemed to be Letters under the RT Facility and all provisions of this agreement shall apply to such Existing Letters of Credit.
ARTICLE 13
DEFAULT AND REMEDIES
 
13.1	Events of Default.	
Upon the occurrence of any one or more of the following events, unless expressly waived in writing in accordance with Section 14.14:
 
 	(a)	a breach of Section 9.1, 9.3, 9.5, 9.6, 9.7 or 9.8;	
 
 	(b)	the non-payment of any amount due hereunder or under any other Loan Document (other than the payment pursuant to Section 9.1, 9.3, 9.5, 9.6, 9.7 or 9.8) within five Banking Days after the due date therefor;	
 
 	(c)	the commencement of proceedings for the dissolution, liquidation or winding-up of any of the Obligors, the Parent or the Ultimate Parent or for the suspension of the operations of any of the Obligors, the Parent or the Ultimate Parent except, in the case of the Secured Obligors only, as permitted pursuant to the proviso in Section 11.3(c) (provided that, if such proceedings are commenced by another Person, such proceedings shall only constitute an Event of Default if (i) such proceedings are not being diligently defended and (ii) such proceedings have not been discharged, vacated or stayed within 30 days after commencement);	
 
 	(d)	any of the Obligors, the Parent or the Ultimate Parent ceases to carry on its business or is adjudged or declared bankrupt or insolvent or admits in writing its inability to pay debts as they become due or makes an assignment for the general benefit of creditors, petitions or applies to any tribunal for the appointment of a receiver or trustee for it or for any part of its property (or such a receiver or trustee is appointed for it or any part of its property), or files a notice of intention to file a proposal, or commences (or any other Person commences) any proceedings relating to it under any bankruptcy, reorganization, arrangement, readjustment of debt, dissolution or liquidation law or statute of any jurisdiction whether now or hereafter in effect (provided that, if such proceedings are	
 
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 	commenced by another Person, such proceedings shall only constitute an Event of Default if (i) such proceedings are not being diligently defended and (ii) such proceedings have not been discharged, vacated or stayed within 30 days after commencement), or by any act indicates its consent to, approval of, or acquiescence in, any such proceeding for it or for any part of its property, or suffers the appointment of any receiver or trustee, sequestrator or other custodian for it or any such part of its property;	
 
 	(e)	any representation or warranty made or deemed made by any Obligor in any Loan Document proves to have been incorrect when made or furnished;	
 
 	(f)	the breach or failure of due observance or performance by any Borrower of Section 11.1(f), (g) or (k) or any provision of Section 11.3;	
 
 	(g)	the breach or failure of due observance or performance by any of the Loan Parties of any covenant or provision of any of the Loan Documents, other than those heretofore or hereafter dealt with in this Section 13.1, which is not remedied within fifteen days after written notice to do so has been given by the Administrative Agent to Anixter Canada;	
 
 	(h)	a writ, execution, attachment or similar process is issued or levied against all or any portion of the Secured Assets in connection with any judgment against any of the Obligors in excess of $25,000,000 and such writ, execution, attachment or similar process is not released, bonded, satisfied, discharged, vacated or stayed within thirty days after its entry, commencement or levy;	
 
 	(i)	one or more encumbrances or lienors enforce their security or other remedies against any part of the property, assets or undertaking of any Obligor having a fair market value in excess of $25,000,000;	
 
 	(j)	any Obligor, the Parent or the Ultimate Parent fails to make any payment in respect of any Indebtedness (whether as principal debtor or guarantor) having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than $25,000,000 or the U.S. Dollar Equivalent thereof when due (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise, but after taking into account any applicable grace period); or (ii) fails to perform or observe any condition or covenant, or any other event shall occur or condition exist, under any agreement or instrument relating to any such Indebtedness and the holder or holders of such Indebtedness or beneficiary or beneficiaries of such Indebtedness (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) are able to cause such Indebtedness to be declared to be due and payable prior to its stated maturity;	
 
 	(k)	the validity, enforceability or priority of any of the Loan Documents is contested in any manner by any Loan Party, the Parent or the Ultimate Parent;	
 
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 	(l)	any Loan Document is terminated or rescinded or any Person takes an action to terminate or rescind any Loan Document;	
 
 	(m)	any Security Document does not create legal, valid, binding and enforceable security over the assets charged under that Security Document;	
 
 	(n)	any Security Document does not constitute first ranking, priority security over the Secured Assets charged under that Security Document (subject to Permitted Liens);	
 
 	(o)	any one or more of the Security Documents is determined by a court of competent jurisdiction not to be valid and enforceable by the Administrative Agent or the Lenders, as the case may be, against the relevant Obligor, and any such document has not been replaced by a valid and enforceable document that is equivalent in effect to such document, assuming such document had originally been valid and enforceable, in form and substance acceptable to the Administrative Agent, within thirty (30) days of such determination, provided, however, that such grace period shall only be provided if the relevant Obligor actively cooperates with the Administrative Agent to so replace such document;	
 
 	(p)	the occurrence of a Material Adverse Change;	
 
 	(q)	Anixter Canada ceases to be directly or indirectly wholly owned by the Parent and the Parent ceases to be directly or indirectly wholly-owned by the Ultimate Parent;	
 
 	(r)	any Person or group of Persons acting “jointly or in concert” (as contemplated by the Securities Act (Ontario)) shall obtain Control of the Ultimate Parent;	
 
 	(s)	if: (i) any Plan shall fail to satisfy the minimum funding standards of ERISA or the Code for any plan year or part thereof or a waiver of such standards under Section 412 of the Code or extension of any amortization period is sought or granted under section 431(d) of the Code, (ii) a notice of intent to terminate any Plan shall have been or is reasonably expected to be filed with the PBGC or the PBGC shall have instituted proceedings under ERISA section 4042 to terminate or appoint a trustee to administer any Plan or the PBGC shall have notified any Company or any ERISA Affiliate that a Plan may become a subject of any such proceedings, (iii) the sum of (A) the aggregate “amount of unfunded benefit liabilities” (within the meaning of section 4001(a)(18) of ERISA) under all Plans, determined in accordance with Title IV of ERISA, plus (B) the amount (if any) by which the aggregate present value of accrued benefit liabilities under all funded Non-U.S. Plans exceeds the aggregate current value of the assets of such Plans and Non-U.S. Plans allocable to such liabilities, shall exceed $15,000,000 or the U.S. Dollar Equivalent thereof, (iv) any Company, including by reason of liability of any ERISA Affiliate, shall have incurred, or is reasonably expected to incur, any liability pursuant to Title IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans, (v) any Company or any ERISA	
 
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 	Affiliate withdraws from any Multiemployer Plan or fails to make any contribution or payment to any Multiemployer Plan which such Company or any ERISA Affiliate may be required to make under any agreement relating to such Multiemployer Plan, (vi) any Company fails to administer or maintain a Non-U.S. Plan in compliance with the requirements of any and all applicable laws, statutes, rules, regulations or court orders or any Non-U.S. Plan is involuntarily terminated or wound up or, (vii) any Company becomes subject to the imposition of a financial penalty (which for this purpose shall mean any tax, penalty or other liability, whether by way of indemnity or otherwise) with respect to one or more Non-U.S. Plans; (viii) amend any Plan so as to result in any increase in current liability for the plan year such that any Company or any ERISA Affiliate is required to provide security to such Plan under section 401(a)(29) of the Code; and any such event or events described in clauses (i) through (vii) above, either individually or together with any other such event or events, could reasonably be expected to have a Material Adverse Effect (as used in this Section 13.1(r), the terms “employee benefit plan” and “employee welfare benefit plan” shall have the respective meanings assigned to each such term in section 3 of ERISA); or	
 
 	(t)	there occurs a default under any of the Subordinate Debt Documents (howsoever defined or described therein) and such default is not corrected or otherwise remedied by 30 days after the earliest to occur of (i) the Borrowers or another Obligor becomes aware of such default, (ii) the Borrowers give notice to the Administrative Agent of such default, and (iii) the Administrative Agent gives notice of such default to the Borrower; or	
 
 	(u)	if any Letter which has a term which extends past the Maturity Date (or an automatic renewal provision which, if exercised, would cause the term to extend past the Maturity Date) is not, at least 5 Banking Days prior to the Maturity Date, (i) returned to the Issuing Bank for cancellation or (ii) cash collateralized with the Issuing Lender for the full face amount thereof plus all fees relating thereto for its term;	
 
 	(v)	the Indebtedness evidenced by the 5.625% Senior Notes due 2019 issued under the indenture dated as of April 30, 2012 between the Parent, the Ultimate Parent and Wells Fargo, as trustee, as the same may be amended or replaced from time to time, is not repaid in full or refinanced or replaced on terms mutually satisfactory to the Parent and the Administrative Agent (including, as to any Indebtedness refinancing or replacing such notes, such Indebtedness having a maturity date not earlier than ninety (90) days after the Maturity Date) by January 31, 2019, which is the date that is 90 days before the stated maturity date of such notes as of the date of this agreement;	
 
 	(w)	any Member of the Borrowing Group is precluded, denied or otherwise prevented for any reason whatsoever from using employing Intellectual Property owned by or licensed to the Parent or the Ultimate Parent;	
 
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the Administrative Agent (with the approval and instructions of the Majority Lenders) may, by notice to the Borrowers, terminate the Credit Facilities, declare all Indebtedness of the Borrowers to the Credit Parties pursuant to this agreement (including (i) the face amount of all Bankers’ Acceptances issued and outstanding hereunder and (ii) the then contingent liability of the Issuing Lenders under all outstanding Letters) and all accrued and unpaid interest and fees hereunder to be immediately due and payable, whereupon the Credit Facilities shall terminate, all such Indebtedness shall immediately become and be due and payable and the Administrative Agent may enforce or cause to be enforced the Security (provided, however, that the Credit Facilities shall terminate, all such Indebtedness of the Borrowers to the Credit Parties shall automatically become due and payable and the Security shall become immediately enforceable, without notice of any kind, upon the occurrence of an event described in clause (c) or (d) above). Upon the payment by the applicable Borrower to the relevant Issuing Lender of the then contingent liability of such Issuing Lender under all outstanding Letters issued by it, such Borrower shall have no further liability to such Issuing Lender with respect to such Letters. With respect to any Bankers’ Acceptances outstanding at the time all such Indebtedness becomes immediately due and payable, the applicable Borrower shall forthwith deposit with the Administrative Agent cash collateral in an amount equal to the aggregate face amount of the Bankers’ Acceptances, to be held on terms and conditions satisfactory to the Administrative Agent, and upon such deposit having been made such Borrower shall have no further liability to the Lenders with respect to such Bankers’ Acceptances.
 
13.2	Refund of Overpayments.	
With respect to each Letter issued by a particular Issuing Lender for which such Issuing Lender has been paid all of its contingent liability pursuant to Section 9.1, 9.6, 9.7 or 13.1 and provided that all such amounts due by the applicable Borrower to such Issuing Lender under Section 9.1, 9.6, 9.7 or 13.1 have been paid, the Issuing Lender agrees to pay to the applicable Borrower, upon the earlier of:
 
 	(a)	the date on which either the original counterpart of such Letter is returned to such Issuing Lender for cancellation or such Issuing Lender is released by the beneficiary thereof from any further obligations in respect of such Letter;	
 
 	(b)	the expiry of such Letter; and	
 
 	(c)	such Issuing Lender is permanently enjoined by a court of competent jurisdiction from honouring such Letter pursuant to a final Order;	
an amount equal to any excess of the amount received by such Issuing Lender hereunder in respect of its contingent liability under such Letter over the total of amounts applied to reimburse such Issuing Lender for amounts paid by it under or in connection with such Letter (such Issuing Lender having the right to so appropriate such funds).
 
13.3	Remedies Cumulative.	
The Borrowers expressly agree that the rights and remedies of the Administrative Agent and the Lenders under this agreement are cumulative and in addition to and not in substitution for any rights or remedies provided by law. Any single or partial exercise by the
 
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Administrative Agent or any of the Lenders of any right or remedy for a default or breach of any term, covenant or condition in this agreement does not waive, alter, affect or prejudice any other right or remedy to which the Administrative Agent or such Lender may be lawfully entitled for the same default or breach. Any waiver by the Administrative Agent with the approval of the Majority Lenders or all of the Lenders in accordance with Section 14.14 of the strict observance, performance or compliance with any term, covenant or condition of this agreement is not a waiver of any subsequent default and any indulgence by the Lenders with respect to any failure to strictly observe, perform or comply with any term, covenant or condition of this agreement is not a waiver of the entire term, covenant or condition or any subsequent default.
 
13.4	Set-Off.	
In addition to any rights now or hereafter granted under Applicable Law, and not by way of limitation of any such rights, the Administrative Agent and each Lender is authorized, at any time that an Event of Default has occurred and is continuing and without notice to the Borrowers or to any other Person, any such notice being expressly waived by the Borrowers, to set-off, appropriate and apply any and all deposits, matured or unmatured, general or special, and any other indebtedness at any time held by or owing by the Administrative Agent or such Lender, as the case may be, to or for the credit of or the account of any Borrower against and on account of the obligations and liabilities of such Borrower which are due and payable to the Administrative Agent or such Lender, as the case may be, under this agreement.
In the event that a Finance Party is party to a deposit account control agreement entered with the Administrative Agent or Hypothecary Representative, as the case may be, and the Obligor in respect of any deposit account of the Obligor maintained with such Finance Party, as the depository institution, the parties hereto acknowledge and agree that the rights of set-off and compensation of such Finance Party contemplated in this Section 13.4 shall be unaffected by the terms and conditions of such deposit account control agreement.
ARTICLE 14
THE ADMINISTRATIVE AGENT
 
14.1	Appointment and Authorization of Administrative Agent.	
Each Finance Party hereby appoints and authorizes, and hereby agrees that it will require any assignee of any of its interests in the Finance Documents (other than the holder of a participation in its interests herein or therein) to appoint and authorize the Administrative Agent to take such actions as agent on its behalf and to exercise such powers under the Finance Documents as are delegated to the Administrative Agent by such Lender by the terms hereof, together with such powers as are reasonably incidental thereto. Neither the Administrative Agent nor any of its directors, officers, employees or agents shall be liable to any of the Lenders for any action taken or omitted to be taken by it or them thereunder or in connection therewith, except for its own gross negligence or wilful misconduct and each Lender hereby acknowledges that the Administrative Agent is entering into the provisions of this Section 14.1 on its own behalf and as agent and trustee for its directors, officers, employees and agents.
 
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For greater certainty, but without limiting the powers of the Administrative Agent pursuant to the terms hereof or of any other the Finance Document, for the purposes of holding any Liens granted by any of the Obligors under the laws of the province of Québec pursuant to the Security Documents, the Finance Parties hereby acknowledge that the Administrative Agent shall be and act as the hypothecary representative of all present and future Finance Parties for all purposes of Article 2692 of the Civil Code of Quebec (the “ Hypothecary Representative ”). Each Finance Party therefore appoints, to the extent necessary, the Administrative Agent as its hypothecary representative to hold the Liens created pursuant to such Security Documents in order to secure the Finance Obligations. By executing any required instrument prior to becoming a Finance Party, each future Finance Party shall be deemed to ratify the appointment of the Administrative Agent as the hypothecary representative of such future Finance Party.
The Administrative Agent accepts to act as hypothecary representative of all present and future Finance Parties for all purposes of Article 2692 of the Civil Code of Quebec .
 
14.2	Interest Holders.	
The Administrative Agent may treat each Lender set forth in Schedule A hereto or the Person designated in the last notice delivered to it under Section 16.2 as the holder of all of the interests of such Lender under the Finance Documents.
 
14.3	Consultation with Counsel.	
The Administrative Agent may consult with legal counsel selected by it as counsel for the Administrative Agent and the Lenders and shall not be liable for any action taken or not taken or suffered by it in good faith and in accordance with the advice and opinion of such counsel.
 
14.4	Documents.	
The Administrative Agent shall not be under any duty to the Finance Parties to examine, enquire into or pass upon the validity, effectiveness or genuineness of the Finance Documents or any instrument, document or communication furnished pursuant to or in connection with the Finance Documents and the Administrative Agent shall, as regards the Finance Parties, be entitled to assume that the same are valid, effective and genuine, have been signed or sent by the proper parties and are what they purport to be.
 
14.5	Administrative Agent as Finance Party.	
With respect to those portions of a particular Credit Facility made available by it, the Administrative Agent shall have the same rights and powers under the Finance Documents as any other Finance Party and may exercise the same as though it were not the Administrative Agent. The Administrative Agent and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Borrowers and their Affiliates and Persons doing business with the Borrowers and/or any of their Affiliates as if it were not the Administrative Agent and without any obligation to account to the Finance Parties therefor.
 
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14.6	Responsibility of Administrative Agent.	
The duties and obligations of the Administrative Agent to the Finance Parties under the Finance Documents are only those expressly set forth herein. The Administrative Agent shall not have any duty to the Finance Parties to investigate whether a Default has occurred. The Administrative Agent shall, as regards the Finance Parties, be entitled to assume that no Default has occurred and is continuing unless the Administrative Agent has actual knowledge or has been notified by the Borrowers of such fact or has been notified by a Finance Party that such Finance Party considers that a Default has occurred and is continuing, such notification to specify in detail the nature thereof.
 
14.7	Action by Administrative Agent.	
The Administrative Agent shall be entitled to use its discretion with respect to exercising or refraining from exercising any rights which may be vested in it on behalf of the Finance Parties by and under this agreement; provided, however, that the Administrative Agent shall not exercise any rights under Section 13.1 or exercise any rights under the Guarantees or the Security Documents or expressed to be on behalf of or with the approval of the Majority Lenders without the request, consent or instructions of the Majority Lenders. Furthermore, any rights of the Administrative Agent expressed to be on behalf of or with the approval of the Majority Lenders shall be exercised by the Administrative Agent upon the request or instructions of the Majority Lenders. The Administrative Agent shall incur no liability to the Finance Parties under or in respect of any of the Finance Documents with respect to anything which it may do or refrain from doing in the reasonable exercise of its judgment or which may seem to it to be necessary or desirable in the circumstances, except for its gross negligence or wilful misconduct. The Administrative Agent shall in all cases be fully protected in acting or refraining from acting under any of the Finance Documents in accordance with the instructions of the Majority Lenders and any action taken or failure to act pursuant to such instructions shall be binding on all Lenders. In respect of any notice by or action taken by the Administrative Agent hereunder, the Borrowers shall at no time be obliged to enquire as to the right or authority of the Administrative Agent to so notify or act.
 
14.8	Notice of Events of Default.	
In the event that the Administrative Agent shall acquire actual knowledge or shall have been notified of any Default, the Administrative Agent shall promptly notify the Lenders and shall take such action and assert such rights under Section 13.1 of this agreement and under the other Finance Documents as the Majority Lenders shall request in writing and the Administrative Agent shall not be subject to any liability by reason of its acting pursuant to any such request. If the Majority Lenders shall fail for five Banking Days after receipt of the notice of any Default or Event of Default to request the Administrative Agent to take such action or to assert such rights under any of the Finance Documents in respect of such Default, the Administrative Agent may, but shall not be required to, and subject to subsequent specific instructions from the Majority Lenders, take such action or assert such rights (other than rights under Section 13.1 of this agreement or under the other Finance Documents and other than giving an express waiver of any Default) as it deems in its discretion to be advisable for the protection of the Lenders except that, if the Majority Lenders have instructed the Administrative Agent not to take such action or assert such rights, in no event shall the Administrative Agent act contrary to such instructions unless required by law to do so.
 
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14.9	Responsibility Disclaimed.	
The Administrative Agent shall be under no liability or responsibility whatsoever as agent hereunder:
 
 	(a)	to the Borrowers or any other Person as a consequence of any failure or delay in the performance by, or any breach by, any Finance Party of any of their obligations under any of the Finance Documents;	
 
 	(b)	to any Finance Party as a consequence of any failure or delay in performance by, or any breach by, the Borrowers or any other Person of any of their obligations under any of the Finance Documents; or	
 
 	(c)	to any Finance Party for any statements, representations or warranties in any of the Finance Documents or in any other documents contemplated hereby or thereby or in any other information provided pursuant to any of the Finance Documents or any other documents contemplated hereby or thereby or for the validity, effectiveness, enforceability or sufficiency of any of the Finance Documents or any other document contemplated hereby or thereby.	
 
14.10	Indemnification.	
The Finance Parties agree to indemnify the Administrative Agent (to the extent not reimbursed by the Borrowers) pro rata according to the Pro Rata Share of each of them from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any nature whatsoever which may be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of any of the Finance Documents or any other document contemplated hereby or thereby or any action taken or omitted by the Administrative Agent under any of the Finance Documents or any document contemplated hereby or thereby, except that no Lender shall be liable to the Administrative Agent for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from the gross negligence or wilful misconduct of the Administrative Agent.
 
14.11	Credit Decision.	
Each Lender represents and warrants to the Administrative Agent that:
 
 	(a)	in making its decision to enter into this agreement and to make its Pro Rata Share of the Credit Facilities available to the Borrowers, it is independently taking whatever steps it considers necessary to evaluate the financial condition and affairs of the Companies and that it has made an independent credit judgment without reliance upon any information furnished by the Administrative Agent; and	
 
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 	(b)	so long as any portion of the Credit Facilities is being utilized by any of the Borrowers, it will continue to make its own independent evaluation of the financial condition and affairs of the Companies.	
 
14.12	Successor Administrative Agent.	
 
 	(a)	Subject to the appointment and acceptance of a successor Administrative Agent as provided below, the Administrative Agent may, with the prior written consent of Anixter Canada (which consent shall not be required for so long as an Event of Default has occurred and is continuing), resign at any time by giving 30 days written notice thereof to the Borrowers and the Lenders. Upon any such resignation, the Majority Lenders, with the prior written consent of Anixter Canada (which consent shall not be required (x) if the successor Administrative Agent is an Affiliate or Subsidiary of the Administrative Agent on the date hereof or (y) for so long as an Event of Default has occurred and is continuing), shall have the right to appoint a successor Administrative Agent who shall be one of the Lenders unless none of the Lenders wishes to accept such appointment. If no successor Administrative Agent shall have been so appointed and shall have accepted such appointment by the time of such resignation, then the retiring Administrative Agent may, on behalf of the Lenders and with the prior written consent of Anixter Canada (which consent shall not be required for so long as an Event of Default has occurred and is continuing), appoint a successor Administrative Agent which shall be a bank organized under the laws of Canada which has combined capital and reserves in excess of $250,000,000 and has an office in Toronto.	
 
 	(b)	If the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (e) of the definition thereof, the Majority Lenders may, to the extent permitted by Applicable Law, by notice in writing to the Borrower and such Person remove such Person as Administrative Agent and, with the prior written consent of Anixter Canada (which consent shall not be required for so long as an Event of Default has occurred and is continuing), appoint a successor. If no such successor shall have been so appointed by the Majority Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall be agreed by the Majority Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date.	
 
 	(c)	Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges, duties and obligations of the retiring or removed Administrative Agent (in its capacity as Administrative Agent but not in its capacity as a Lender) and the retiring or removed Administrative Agent shall be discharged from its duties and obligations hereunder (in its capacity as Administrative Agent but not in its capacity as a Lender). After any retiring or removed Administrative Agent’s resignation or removal hereunder as the Administrative Agent, provisions of this Article 14 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Administrative Agent.	
 
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14.13	Delegation by Administrative Agent.	
The Administrative Agent shall have the right to delegate any of its duties or obligations hereunder as Administrative Agent to any Affiliate of the Administrative Agent so long as the Administrative Agent shall not thereby be relieved of such duties or obligations.
 
14.14	Waivers and Amendments.	
 
 	(a)	Subject to Sections 14.14(b) and 14.14(c), inclusive, any term, covenant or condition of any of the Loan Documents may only be amended with the prior consent of the Borrowers and the Majority Lenders or compliance therewith may be waived (either generally or in a particular instance and either retroactively or prospectively) by the Majority Lenders and in any such event the failure to observe, perform or discharge any such covenant, condition or obligation, so amended or waived (whether such amendment is executed or such consent or waiver is given before or after such failure), shall not be construed as a breach of such covenant, condition or obligation or as a Default.	
 
 	(b)	Notwithstanding Section 14.14(a), without the prior written consent of each Lender, no such amendment or waiver shall directly:	
 
 	(i)	increase the amount of either of the Credit Facilities, the amount of either of the Credit Limits or the amount of the Individual Commitment of any Lender with respect thereto;	
 
 	(ii)	amend the requirement of pro rata application of all amounts received by the Administrative Agent in respect of either Credit Facility;	
 
 	(iii)	change the percentage of the Lenders’ requirement to constitute the Majority Lenders or otherwise amend the definition of Majority Lenders;	
 
 	(iv)	reduce the stated amount or postpone the date for payment of any fees or other amount to be paid pursuant to Article 7 or Article 8 of this agreement;	
 
 	(v)	permit any subordination of any of the Obligations;	
 
 	(vi)	release or discharge any of the Security Documents or the Security or any of the Guarantees, in whole or in part, or release any of the Secured Assets from the Security, in whole or in part except as permitted by Section 11.3(c) and Section 14.25;	
 
 	(vii)	alter the terms of this Section 14.14, 14.16, 14.19 or 14.22; or	
 
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 	(viii)	amend the definitions of “Exposure”, “Finance Party”, “Obligations” or “Finance Obligations Termination Date” or any definition forming part thereof.	
 
 	(c)	Notwithstanding Section 14.14(a), without the prior written consent of each Lender, no amendment or waiver shall extend the Maturity Date or the time for the payment of interest on Loans made under the Credit Facilities or fees to be paid under the Credit Facilities, forgive any portion of principal thereof or reduce the stated rate of interest or fees payable thereon.	
 
 	(d)	Notwithstanding any other provisions of this agreement, the Finance Obligations of each Qualified Capital Market Lender (including, for certainty, each Qualified Capital Market Lender that is no longer a Lender or an Affiliate of a Lender) shall at all times rank pari passu with the Obligations of each other Finance Party and the Finance Obligations of the Finance Parties (including, for certainty, any Qualified Capital Market Lender that is no longer a Lender or an Affiliate of a Lender) shall be paid pro rata in accordance with their relative Exposures that are then due and payable, in each case regardless of any amendments made to this agreement after the date hereof. Notwithstanding any other provisions of this agreement, no amendment shall be made to this Section 14.14(d) or Section 14.22 without the written consent of each Qualified Capital Market Lender that is no longer a Lender or an Affiliate of a Lender and each other Finance Party.	
 
 	(e)	No amendment to or waiver of any provision hereof to the extent it affects the rights or obligations of the Administrative Agent shall be effective without the prior written consent of the Administrative Agent.	
 
 	(f)	Without the prior written consent of an Issuing Lender, no amendment to or waiver of Article 14 or any other provision hereof to the extent it affects the rights or obligations of such Issuing Lender shall be effective.	
 
 	(g)	Notwithstanding any other provision hereof, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Individual Commitment of such Lender may not be increased or extended nor any forgiveness or reduction of the principal and interest owed to such Defaulting Lender by the Borrowers hereunder be made without the consent of such Defaulting Lender.	
 
14.15	Determination by Administrative Agent Conclusive and Binding.	
Any determination that is expressly permitted to be made by the Administrative Agent on behalf of the Lenders or the Majority Lenders under this agreement shall be made by the Administrative Agent in good faith and, if so made, shall be binding on all parties, absent manifest error.
 
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14.16	Adjustments among Lenders after Acceleration.	
 
 	(a)	The Lenders agree that, at any time after all Indebtedness of the Borrowers to the Lenders pursuant hereto has become immediately due and payable pursuant to Section 13.1 or after the cancellation or termination of the Credit Facilities, they will at any time or from time to time upon the request of any Lender through the Administrative Agent purchase portions of the availments made available by the other Lenders which remain outstanding, and make any other adjustments which may be necessary or appropriate, in order that the amounts of the availments made available by the respective Lenders which remain outstanding, as adjusted pursuant to this Section 14.16, will be in the same proportions as their respective Pro Rata Shares thereof with respect to each of the Credit Facilities immediately prior to such acceleration, cancellation or termination.	
 
 	(b)	The Lenders agree that, at any time after all Indebtedness of the Borrowers to such Lenders pursuant hereto has become immediately due and payable pursuant to Section 13.1 or after the cancellation or termination of the Credit Facilities, the amount of any repayment made by the Borrowers under this agreement, and the amount of any proceeds of the exercise of any rights or remedies of the Lenders under the Finance Documents, which are to be applied against amounts owing hereunder as principal, will be so applied in a manner such that to the extent possible, the availments made available by the respective Lenders which remain outstanding, after giving effect to such application, will be in the same proportions as their respective Pro Rata Shares thereof with respect to each of the Credit Facilities immediately prior to such acceleration, cancellation or termination.	
 
 	(c)	For greater certainty, the Lenders acknowledge and agree that without limiting the generality of the provisions of Section 14.16(a) and (b), such provisions will have application if and whenever any Lender shall obtain any payment (whether voluntary, involuntary, through the exercise of any right of set-off, compensation, or otherwise) on account of any monies owing or payable by the Borrowers to it under the Finance Documents in excess of its pro rata share of payments on account of monies owing by the Borrowers to all the Finance Parties thereunder.	
 
 	(d)	The Borrowers agree to be bound by and to do all things necessary or appropriate to give effect to any and all purchases and other adjustments made by and between the Lenders pursuant to this Section 14.16.	
 
14.17	Redistribution of Payment.	
If a Lender shall receive payment of a portion of the aggregate amount of principal and interest due to it under any of the Credit Facilities which is greater than the proportion received by any other Lender in respect of the aggregate amount of principal and interest due in respect of such Credit Facility (having regard to the respective Individual Commitments of the Lenders with respect to such Credit Facility), the Lender receiving such proportionately greater payment shall purchase a participation (which shall be deemed to have
 
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been done simultaneously with receipt of such payment) in that portion of the aggregate outstanding credit of the other Lender or Lenders so that the respective receipts shall be pro rata to their respective participation in the credits; provided, however, that if all or part of such proportionately greater payment received by such purchasing Lender shall be recovered from the Borrowers, such purchase shall be rescinded and the purchase price paid for such participation shall be returned by such selling Lender or Lenders to the extent of such recovery, but without interest.
 
14.18	Distribution of Notices.	
Except as otherwise expressly provided herein, promptly after receipt by the Administrative Agent of any notice or other document which is delivered to the Administrative Agent hereunder on behalf of the Lenders, the Administrative Agent shall provide a copy of such notice or other document to each of the Lenders.
 
14.19	Determination of Exposures.	
Prior to any distribution of Cash Proceeds of Realization to the Finance Parties, the Administrative Agent shall request each Finance Party to provide to the Administrative Agent a written calculation of such Finance Party’s Exposure, each such calculation to be certified true and correct by the Finance Party providing same. Each Finance Party shall so provide such calculation within two Banking Days following the request of the Administrative Agent. Any such calculation provided by a particular Finance Party shall, absent manifest error, constitute prima facie evidence of such Finance Party’s Exposure at such time. With respect to each determination of the Exposure of the Finance Parties, the Administrative Agent shall promptly notify the Finance Parties. For the purposes of determining a particular Finance Party’s Exposure:
 
 	(a)	the Exposure of a Finance Party under any Loan Documents shall be the aggregate amount owing to such Finance Party thereunder on such date;	
 
 	(b)	the Exposure of a Qualified Capital Market Lender in respect of Secured Capital Market Agreements shall be measured as the net exposure of such Qualified Capital Market Lender under all Secured Capital Market Agreements with the Secured Obligors to which such Qualified Capital Market Lender is a party, being the aggregate exposure of such Qualified Capital Market Lender thereunder less the aggregate exposure of the Secured Obligors thereunder; the exposure of a party to a Secured Capital Market Agreement shall be, in the case of a Secured Capital Market Agreement which has not been terminated as of such date, the total amount which would be owing to such party by the other party under such Secured Capital Market Agreement in the event of the early termination as of such date of such Secured Capital Market Agreement as a result of the occurrence of a default, event of default or termination event (however specified or designated) with respect to such party thereunder or, in the case of a Secured Capital Market Agreement which has been terminated as of such date, the total amount which is owing to such party by the other party under such Secured Capital Market Agreement, in each case expressed in Canadian dollars; and	
 
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 	(c)	the Exposure of a Qualified Cash Management Lender in respect of Cash Management Agreements shall be the aggregate amount which would be owing by the Obligors thereunder on such date if such agreements were terminated on such date, in each case expressed in Canadian dollars.	
 
14.20	Decision to Enforce Security.	
Upon the Security becoming enforceable in accordance with its terms, the Administrative Agent shall promptly so notify each of the Finance Parties. Any Finance Party may thereafter provide the Administrative Agent with a written request to enforce the Security. Forthwith after the receipt of such a request, the Administrative Agent shall seek the instructions of the Majority Lenders as to whether the Security should be enforced and the manner in which the Security should be enforced. In seeking such instructions, the Administrative Agent shall submit a specific proposal to the Finance Parties. The Administrative Agent shall promptly notify the Lenders of all instructions and approvals of the Majority Lenders.
 
14.21	Enforcement.	
The Administrative Agent reserves the sole right to enforce, or otherwise deal with, the Security and to deal with the Obligors in connection therewith; provided, however, that the Administrative Agent shall so enforce, or otherwise deal with, the Security as the Majority Lenders shall instruct.
 
14.22	Application of Cash Proceeds of Realization.	
 
 	(a)	All Proceeds of Realization not in the form of cash shall be forthwith delivered to the Administrative Agent and disposed of, or realized upon, by the Administrative Agent in such manner as the Majority Lenders may approve so as to produce Cash Proceeds of Realization.	
 
 	(b)	Subject to the claims, if any, of secured creditors of the Obligors whose security ranks in priority to the Security, all Cash Proceeds of Realization shall be applied and distributed, and the claims of the Lenders shall be deemed to have the relative priorities which would result in the Cash Proceeds of Realization being applied and distributed, as follows:	
 
 	(i)	firstly, to the payment of all reasonable costs and expenses incurred by or on behalf of the Administrative Agent (including, without limitation, all legal fees and disbursements) in the exercise of all or any of the powers granted to it hereunder or under other Finance Documents and in payment of all of the remuneration of any receiver and all costs and expenses properly incurred by such receiver (including, without limitation, all legal fees and disbursements) in the exercise of all or any powers granted to it under the Security Documents;	
 
 	(ii)	secondly, in payment of all amounts of money borrowed or advanced by the Administrative Agent or such receiver pursuant to the Security Documents and any interest thereon;	
 
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 	(iii)	thirdly, to the payment of fees and interest forming part of the Finance Obligations to the Finance Parties pro rata in accordance with their relative Exposures	
 
 	(iv)	fourthly, to the payment or the prepayment of all other Finance Obligations (including holding as cash collateral to be applied against Finance Obligations which have not then matured) to the Finance Parties pro rata in accordance with their relative Exposures; and	
 
 	(v)	the balance, if any, to the Borrowers or otherwise in accordance with Applicable Law.	
 
14.23	Security Documents.	
As continuing collateral security for the Finance Obligations, the Borrowers shall, and shall cause the Secured Obligors to, execute and deliver the Guarantees and the Borrowers shall, and shall cause the Secured Obligors to, execute and deliver the Security Documents. The Guarantees and the Security Documents shall be entered into in favour of the Administrative Agent for the rateable benefit of the Finance Parties. The Administrative Agent declares that it shall hold the Security, the Secured Assets charged by the Security Documents and the rights granted to it under the Finance Documents for its own benefit and in its capacity as agent for the rateable benefit of each Finance Party.
 
14.24	Entering into Contracts.	
Each Finance Party hereby irrevocably authorizes the Administrative Agent to enter into the Guarantees and the Security Documents as agent for and on behalf of such Finance Party and Borrowers hereby expressly acknowledge the authority of the Administrative Agent to enter into the Guarantees and the Security Documents.
 
14.25	Discharge of Security.	
 
 	(a)	To the extent a sale or other disposition of the Secured Assets is permitted pursuant to the provisions hereof, the Finance Parties hereby authorize the Administrative Agent, at the cost and expense of the Borrowers, to execute such discharges and other instruments which are necessary for the purposes of releasing and discharging the Security therein or for the purposes of recording the provisions or effect thereof in any office where the Security Documents may be registered or recorded or for the purpose of more fully and effectively carrying out the provisions of this Section 14.25.	
 
 	(b)	At such time that (i) no Default has occurred and is continuing, (ii) the Parent and the Ultimate Parent have executed and delivered to the Administrative Agent and instrument of adhesion to this agreement in the form appended hereto as Schedule J and have caused to be delivered to the Administrative Agent a legal opinion, in form and substance satisfactory to the Administrative Agent, in respect of such instrument of adhesion, (iii) the Interest Coverage Ratio and the Total Leverage Ratio are both in compliance at such time	
 
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 	and (iv) the NRT Obligations Termination Date has occurred, all Security Documents shall be terminated, all liens and registrations perfecting the Security shall be discharged and all collateral pledged pursuant to the Security Documents shall be returned to the applicable Obligor. For certainty, the Obligors may in their discretion choose to leave the Security Documents in place rather than arrange for the Parent and the Ultimate Parent to become Guarantors.	
 
14.26	Survivorship.	
The provisions of Articles 14 and 15 and all other provisions of this agreement which are necessary to give effect to each of the provisions of such Articles shall survive the permanent repayment in full of the Credit Facilities and the termination of all of the commitments of the Lenders in connection therewith until the Finance Obligations Termination Date.
ARTICLE 15
GUARANTEE
 
15.1	Guarantee.	
Each Primary Obligor hereby unconditionally, absolutely and irrevocably guarantees the full and punctual payment to the Finance Parties, as and when due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise of all of the Finance Obligations of each other Obligor in the same currency as the currency of such Finance Obligations, whether for principal, interest, fees, expenses, indemnities or otherwise.
 
15.2	Nature of Guarantee.	
The guarantee provided for in this Article 15 shall in all respects be a continuing, absolute, unconditional and irrevocable guarantee of payment when due and not of collection, and shall remain in full force and effect until the Finance Obligations Termination Date. Each Primary Obligor guarantees that the Finance Obligations of each other Obligor will be paid strictly in accordance with the terms thereof, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of the Finance Parties with respect thereto. Each Primary Obligor renounces all benefits of discussion and division. The liability of the Primary Obligors hereunder shall be absolute, unconditional and irrevocable irrespective of, and without being released or limited by:
 
 	(a)	any lack of validity, legality or enforceability of any provision of this Agreement;	
 
 	(b)	the failure of any Finance Party	
 
 	(i)	to assert any claim or demand or to enforce any right or remedy against any Primary Obligor or any other Person (including any other guarantor) under the provisions of this Agreement, or otherwise, or	
 
 	(ii)	to exercise any right or remedy against any other guarantor of, or collateral securing, any of the Finance Obligations;	
 
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 	(c)	any change in the time, manner or place of payment of, or in any term of, all or any of the Finance Obligations, or any other extension, compromise, indulgence or renewal of any Finance Obligation;	
 
 	(d)	any reduction, limitation, variation, impairment, discontinuance or termination of the Finance Obligations for any reason (other than by reason of any payment which is not required to be rescinded), including any claim of waiver, release, discharge, surrender, alteration or compromise, and shall not be subject to (and each Primary Obligor hereby waives any right to or claim of) any defence or setoff, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality, non-genuineness, irregularity, compromise, unenforceability of, or any other event or occurrence affecting, the Finance Obligations or otherwise (other than by reason of any payment which is not required to be rescinded);	
 
 	(e)	any amendment to, rescission, waiver or other modification of, or any consent to any departure from, any of the terms of the Finance Obligations or any guarantees or security;	
 
 	(f)	any addition, exchange, release, discharge, renewal, realization or non-perfection of any collateral security;	
 
 	(g)	any amendment to, or waiver or release or addition of, or consent to departure from, any other guarantee held by the Finance Parties as security for any of the Finance Obligations;	
 
 	(h)	the loss of or in respect of or the unenforceability of any other guarantee or other security which the Finance Parties may now or hereafter hold in respect of the Finance Obligations, whether occasioned by the fault of a Finance Party or otherwise;	
 
 	(i)	any change in the name of an Obligor or in the constating documents, capital structure, capacity or constitution of an Obligor, the bankruptcy or insolvency of an Obligor, the sale of any or all of an Obligor’s business or assets or an Obligor being consolidated, merged or amalgamated with any other Person; or	
 
 	(j)	any other circumstance (other than final payment in full) which might otherwise constitute a defence available to, or a legal or equitable discharge of any surety or any other guarantor.	
 
15.3	Credit Parties not Bound to Exhaust Recourse.	
The Credit Parties shall not be bound to exhaust their recourse against an Obligor or others or any security or other guarantees they may at any time hold before being entitled to payment hereunder from a Primary Obligor.
 
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15.4	Evidence of Finance Obligations.	
A written statement of the Administrative Agent as to the amount of any Finance Obligations of any Obligor shall be prima facie evidence against each Primary Obligor as to the amount of such Finance Obligations.
 
15.5	Guarantee in Addition to Other Security.	
The guarantee provided for in this Article 15 shall be in addition to and not in substitution for any other guarantee or other security which the Finance Parties may now or hereafter hold in respect of the Finance Obligations, and the Finance Parties shall be under no obligation to marshal in favour of any Primary Obligor any other guarantee or other security or any moneys or other assets which they may be entitled to receive or may have a claim upon.
 
15.6	Reinstatement.	
The guarantee provided for in this Article 15 and all other terms of this Article 15 shall continue to be effective or shall be reinstated, as the case may be, if at any time any payment by a Primary Obligor or any other Guarantor of any of the Finance Obligations is rescinded or must otherwise be returned by the recipients thereof by reason of the insolvency, bankruptcy or reorganization of an Obligor or for any other reason, all as though such payment had not been made.
 
15.7	Waiver of Notice, Etc.	
Each Primary Obligor hereby waives promptness, diligence, notice of acceptance and any other notice with respect to any of the Finance Obligations and this Agreement.
 
15.8	Subrogation Rights, Assignment and Postponement of Claim.	
Until satisfaction in full of all of the Finance Obligations, all dividends, compositions, proceeds of security or payments received by the Finance Parties in respect of the Finance Obligations shall be regarded for all purposes as payments in gross. No Primary Obligor shall exercise any rights which it may acquire by way of subrogation under this Agreement, by any payment made hereunder or otherwise, until the prior satisfaction in full of all of the Finance Obligations. Any amount paid to a Primary Obligor on account of any such subrogation rights prior to the satisfaction in full of all Finance Obligations shall be held in trust for the benefit of the Finance Parties and shall immediately be paid to the Finance Parties and credited and applied against the Finance Obligations, whether matured or unmatured, in accordance with the terms hereof; provided, however, that if
 
 	(a)	A Primary Obligor has made payment to the Finance Parties of all of the Finance Obligations, and	
 
 	(b)	the Finance Obligations Termination Date has occurred,	
such Primary Obligor shall be subrogated to the rights of the Finance Parties against the applicable Obligor with respect to all Finance Obligations of such Obligor and, at the relevant
 
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Primary Obligor’s request, the Finance Parties will execute and deliver to such Primary Obligor appropriate documents (without recourse and without representation or warranty, except that it has not released, assigned or encumbered any subject Finance Obligations) necessary to evidence the transfer by subrogation to such Primary Obligor of all such Finance Obligations.
All debts and liabilities, present and future, of each Primary Obligor to each other Obligor are hereby assigned to the Finance Parties and postponed in right of payment to the Finance Obligations of such other Obligor, and all moneys received by such Primary Obligor in respect thereof shall be received in trust for the Finance Parties and forthwith upon receipt shall be paid over to the Administrative Agent, the whole without in any way lessening or limiting the liability of such Primary Obligor hereunder; and this assignment and postponement shall remain in full force and effect until the Finance Obligations Termination Date.
 
15.9	Advance After Certain Events.	
All advances, renewals and credits made or granted hereunder or in connection herewith by the Finance Parties purportedly to or for any Obligor after the bankruptcy or insolvency of such Obligor but before the Finance Parties have received notice thereof, shall be deemed to form part of the Finance Obligations, and all advances, renewals and credits obtained from the Finance Parties hereunder purportedly by or on behalf of any Obligor shall be deemed to form part of the Finance Obligations, notwithstanding any lack or limitation of power, incapacity or disability of such Obligor or of the directors or agents thereof and notwithstanding that such Obligor may not be a legal or suable entity and notwithstanding any irregularity, defect or informality in the obtaining of such advances, renewals or credits, whether or not the Finance Parties had knowledge thereof.
 
15.10	Parallel Debt (Covenant to pay the Administrative Agent).	
 
 	(a)	Notwithstanding any other provision of this Agreement, each Primary Obligor hereby irrevocably and unconditionally undertakes to pay to the Administrative Agent (the “ Parallel Debt ”), as creditor in its own right and not as representative of the other Finance Parties, sums equal to and in the currency of each amount payable by Anixter Canada or Anixter Mid Holdings to each of the Finance Parties under each of the Finance Documents as and when that amount falls due for payment under the relevant Finance Document.	
 
 	(b)	The Administrative Agent shall have its own independent right to demand payment of the Parallel Debt.	
 
 	(c)	Any Parallel Debt shall be decreased to the extent that the other Finance Parties have received (and are able to retain) payment of the corresponding amount under the other provisions of the Finance Documents and any amount due and payable by Anixter Canada or Anixter Mid Holdings to the other Finance Parties under those provisions shall be decreased to the extent that the Administrative Agent has received (and is able to retain) payment of the corresponding Parallel Debt.	
 
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ARTICLE 16
MISCELLANEOUS
 
16.1	Waivers.	
No failure or delay by the Administrative Agent, the Lenders or the Majority Lenders in exercising any remedy, right or power hereunder or otherwise shall operate as a waiver thereof, except a waiver which is specifically given in writing by the Administrative Agent, and no single or partial exercise of any power, right or privilege hereunder will preclude any other or further exercise thereof or the exercise of any other power, right or privilege.
 
16.2	Notices.	
All notices, demands and other communications provided for in this agreement shall be in writing and shall be personally delivered to an officer of the addressee or sent by telefacsimile, charges prepaid, at or to the applicable addresses, email addresses (which email notice shall be sent with a “read receipt” request) or telefacsimile numbers, as the case may be, set opposite the party’s name on the signature page hereof (in the case of the Borrowers and the Administrative Agent) or set forth in Schedule A hereto (in the case of the Lenders) or at or to such other address or addresses, email address or email addresses or telefacsimile number or numbers as any party hereto may from time to time designate to the other parties in such manner. Any communication which is personally delivered as aforesaid shall be deemed to have been validly and effectively given on the date of such delivery if such date is a Banking Day and such delivery was made prior to 4:00 p.m. (Toronto time); otherwise, it shall be deemed to have been validly and effectively given on the Banking Day next following such date of delivery. Any communication which is transmitted by telefacsimile as aforesaid shall be deemed to have been validly and effectively given on the date of transmission if such date is a Banking Day and such transmission was made prior to 4:00 p.m. (Toronto time); otherwise, it shall be deemed to have been validly and effectively given on the Banking Day next following such date of transmission.
 
16.3	Severability.	
Any provision hereof which is prohibited or unenforceable shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof.
 
16.4	Counterparts.	
This agreement may be executed in one or more counterparts, each of which shall be deemed to be an original and all of which taken together shall be deemed to constitute one and the same instrument.
 
16.5	Successors and Assigns; No Third Party Rights or Liabilities.	
This agreement shall enure to the benefit of and shall be binding upon the parties hereto and their respective successors and permitted assigns. Nothing in this agreement will be construed to give any Person other than the parties hereto any legal or equitable right, remedy, or claim under or with respect to this agreement or any provision of this agreement. This agreement and all of its provisions and conditions are for the sole and exclusive benefit of the parties hereto and their successors and assigns.
 
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16.6	Assignment.	
 
 	(a)	Without the consent of all of the Lenders, neither the Loan Documents nor the benefit thereof may be assigned by the Borrowers.	
 
 	(b)	A Lender may at any time sell to one or more other Persons (“ Participants ”) participating interests in any credit outstanding hereunder, any commitment of such Lender hereunder or any other interest of such Lender hereunder. In the event of any such sale by a Lender of a participating interest to a Participant, the Lender’s obligations under this agreement to the Borrowers shall remain unchanged, the Lender shall remain solely responsible for the performance thereof and the Borrowers shall continue to be obligated to the Lender in connection with the Lender’s rights under this agreement. The Borrowers agree that if amounts outstanding under this agreement are due and unpaid, or shall have been declared to be or shall have become due and payable upon the occurrence of an Event of Default, or any Default which might mature into an Event of Default, each Participant shall be deemed to have the right of setoff in respect of its participating interest in amounts owing under this agreement to the same extent as if the amount of its participating interest were owing directly to it as the relevant Lender under this agreement. The Borrowers also agree that each Participant shall be entitled to the benefits of Article 8 with respect to its participation hereunder; provided, that no Participant shall be entitled to receive any greater amount pursuant to such Article than the Lender would have been entitled to receive in respect of the amount of the participation transferred by the Lender to such Participant had no such transfer occurred.	
 
 	(c)	With the prior written consent of the Borrowers (which consent shall not be required for so long as a Default has occurred and is continuing), each Issuing Lender (which consent shall only be required with respect to an assignment of the RT Facility and which shall not otherwise be required if such sale is to one or more Lenders or to an affiliate or subsidiary of any of the Lenders), the Swingline Lender (which consent shall only be required with respect to an assignment of the RT Facility and which shall otherwise not be required if such sale is to one or more Lenders or to an affiliate or subsidiary of any of the Lenders) and the Administrative Agent (such consent not to be unreasonably withheld) and provided that, at any time other than when a Default has occurred and is continuing, such sale shall not be to a non-resident of Canada for purposes of the Income Tax Act (Canada) if such assignment would result in increased costs to any Borrower hereunder, a Lender may at any time sell all or any part of its rights and obligations under the Loan Documents to one or more Persons (“ Purchasing Lenders ”) in amounts no less than $5,000,000 and provided, unless the Lender is selling all of its remaining rights and obligations under the Loan Documents, such Lender retains an aggregate of at least $5,000,000 in Individual Commitments. Upon such sale, the Lender shall, to the extent of such sale, be released from its	
 
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 	obligations under the Loan Documents (subject always to its continuing obligations under Section 9.7) and each of the Purchasing Lenders shall become a party to the Loan Documents to the extent of the interest so purchased provided, however, no Lender that is a Defaulting Lender shall be released from any obligation in respect of damages arising in connection with it being or becoming a Defaulting Lender. Any such assignment by a Lender shall not be effective unless and until such Lender has paid to the Administrative Agent an assignment fee in the amount of $3,500 for each Purchasing Lender, unless and until the Purchasing Lender has executed an instrument substantially in the form of Schedule C hereto whereby the Purchasing Lender has agreed to be bound by the terms of the Loan Documents as a Lender and has agreed to specific Individual Commitments and a specific address and telefacsimile number for the purpose of notices as provided in Section 16.2. Upon any such assignment becoming effective, Schedule A hereto shall be deemed to be amended to include the Purchasing Lender as a Lender with the specific Individual Commitments, address and telefacsimile number as aforesaid and the Individual Commitments of the Lender making such assignment shall be deemed to be reduced by the respective amounts of the Individual Commitments of the Purchasing Lender. When an assignment has been effected pursuant to this Section 16.6(c) without the consent of the Borrowers, the Administrative Agent shall, within five Banking Days of any such assignment becoming effective, provide the Borrowers with written notice of such assignment.	
 
 	(d)	The Borrowers authorize the Administrative Agent and the Lenders to disclose to any Participant or Purchasing Lender (each, a “ Transferee ”) and any prospective Transferee and authorizes each of the Lenders to disclose to any other Lender any and all financial information in their possession concerning the Borrowers which has been delivered to them by or on behalf of the Borrowers pursuant to this agreement or which has been delivered to them by or on behalf of the Borrowers in connection with their credit evaluation of the Borrowers prior to becoming a party to this agreement, so long as any such Transferee agrees not to disclose any confidential, non-public information to any person other than its non-brokerage affiliates, employees, accountants or legal counsel, unless required by law.	
 
16.7	Entire Agreement.	
The Loan Documents and the agreements referred to therein and delivered pursuant thereto constitute the entire agreement between the parties hereto and supersede any prior agreements, commitment letters, undertakings, declarations, representations and understandings, both written and verbal, in respect of the subject matter hereof.
 
16.8	Judgment Currency.	
 
 	(a)	If, for the purpose of obtaining or enforcing judgment against any Borrower in any court in any jurisdiction, it becomes necessary to convert into a particular currency (such currency being hereinafter in this Section 16.8 referred to as the “ Judgment Currency ”) an amount due in another currency (such other currency	
 
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 	being hereinafter in this Section 16.8 referred to as the “ Indebtedness Currency ”) under this agreement, the conversion shall be made at the rate of exchange prevailing on the Banking Day immediately preceding:	
 
 	(i)	the date of actual payment of the amount due, in the case of any proceeding in the courts of the Province of Ontario or in the courts of any other jurisdiction that will give effect to such conversion being made on such date; or	
 
 	(ii)	the date on which the judgment is given, in the case of any proceeding in the courts of any other jurisdiction (the date as of which such conversion is made pursuant to this Section 16.8(a)(i) being hereinafter in this Section 16.8 referred to as the “ Judgment Conversion Date ”).	
 
 	(b)	If, in the case of any proceeding in the court of any jurisdiction referred to in Section 16.8(a)(i), there is a change in the rate of exchange prevailing between the Judgment Conversion Date and the date of actual payment of the amount due, the applicable Borrower shall pay to the Lenders, such additional amount (if any, but in any event not a lesser amount) as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the rate of exchange prevailing on the date of payment, will produce the amount of the Indebtedness Currency which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial order at the rate of exchange prevailing on the Judgment Conversion Date.	
 
 	(c)	Any amount due from a Borrower under the provisions of Section 16.8(b) shall be due to the judgment creditor as a separate debt and shall not be affected by judgment being obtained for any other amounts due under or in respect of this agreement.	
 
 	(d)	The term “rate of exchange” in this Section 16.8 means the noon spot rate of exchange for Canadian interbank transactions applied in converting the Indebtedness Currency into the Judgment Currency published by the Bank of Canada for the day in question.	
 
16.9	Forum Selection and Consent to Jurisdiction.	
Any legal action or proceeding with respect to this agreement may be brought in the courts of the Province of Ontario and, by execution and delivery of this agreement, the parties hereby accept for themselves and in respect of their property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each Borrower hereby expressly and irrevocably submits to the jurisdiction of the courts of the Province of Ontario for the purpose of any such litigation as set forth above and irrevocably agrees to be bound by any judgment rendered thereby in connection with such litigation. Each Borrower hereby expressly and irrevocably waives, to the fullest extent permitted by law, any objection which it may have or hereafter may have to the laying of venue of any such litigation brought in any such court referred to above and any claim that any such litigation has been brought in an inconvenient
 
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forum. To the extent that any Borrower has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution or otherwise) with respect to itself or its property, such Borrower hereby irrevocably waives such immunity in respect of its obligations under this agreement. Nothing herein shall limit the right of any party to serve process in any manner permitted by law or to commence legal proceedings or otherwise proceed against any other party in any jurisdiction other than the Province of Ontario.
 
16.10	Confidentiality.	
The Administrative Agent and each Lender agrees to use commercially reasonable efforts to ensure that financial statements or other information relating to the Borrowers which may be delivered to it pursuant to this agreement and which are not publicly filed or otherwise made available to the public generally will be treated confidentially by the Administrative Agent and each Lender and will not, except with the written consent of the Borrowers, be distributed or otherwise made available by the Administrative Agent or any Lender to any Person other than its directors, officers, employees, authorized agents, counsel or other representatives (provided the other representatives have agreed or are under a duty to keep all information confidential) required, in the reasonable opinion of the Administrative Agent or such Lender, to have such information. The Administrative Agent and each Lender is authorized to deliver a copy of any financial statements or any other information which may be delivered to it pursuant to this agreement, to (i) any actual or potential Participant or Assignee provided prior written notice is given to the Borrowers and the Participant or Assignee agrees to keep all such information confidential, (ii) any Official Body having jurisdiction over the Administrative Agent or a Lender, as the case may be, in order to comply with any Applicable Law, (iii) to its Affiliates (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential) and (iv) to any other Person in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder.
 
16.11	USA PATRIOT Act Notice.	
Each Lender that is subject to the Act (as hereinafter defined) hereby notifies the Borrowers that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Act ”), it is required to obtain, verify and record information that identifies each Borrower, which information includes the names and address of such Obligor and other information that will allow such Lender to identify such Obligor in accordance with the Act.
 
16.12	Anti-Money Laundering Legislation.	
 
 	(a)	The Borrowers acknowledge that, pursuant to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and other applicable anti-money laundering, anti-terrorist financing, government sanction and “know your client” applicable laws, whether within Canada or elsewhere (collectively, including any guidelines or orders thereunder, “ AML Legislation ”), the Lenders	
 
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 	and the Administrative Agent may be required to obtain, verify and record information regarding the Obligors and their directors, authorized signing officers, direct or indirect shareholders or unitholders or other Persons in control of the Borrowers and/or any such Subsidiary, and the transactions contemplated hereby. The Borrowers shall promptly:	
 
 	(i)	provide all such information, including supporting documentation and other evidence, as may be reasonably requested by any Lender or the Administrative Agent, or any prospective assignee of a Lender or the Administrative Agent, in order to comply with any applicable AML Legislation, whether now or hereafter in existence; and	
 
 	(ii)	if requested from time to time, notify the recipient of any such information of any changes thereto.	
 
 	(b)	If, upon the written request of any Lender, the Administrative Agent has ascertained the identity of a Borrower or any of its Subsidiaries or any authorized signatories of a Borrower or any of its Subsidiaries for the purposes of applicable AML Legislation on such Lender’s behalf, then the Administrative Agent:	
 
 	(i)	shall be deemed to have done so as an agent for such Lender, and this agreement shall constitute a “written agreement” in such regard between such Lender and the Administrative Agent within the meaning of applicable AML Legislation; and	
 
 	(ii)	shall provide to such Lender copies of all information obtained in such regard without any representation or warranty as to its accuracy or completeness.	
Notwithstanding the foregoing, each of the Lenders agrees that the Administrative Agent has no obligation to ascertain the identity of any Borrower or any of its Subsidiaries or any authorized signatories of any Borrower or any of its Subsidiaries, on behalf of any Lender, or to confirm the completeness or accuracy of any information it obtains from any Borrower or any of its Subsidiaries or any such authorized signatory in doing so.
 
16.13	Waivers of Jury Trial.	
EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT TO WHICH IT IS A PARTY AND FOR ANY COUNTERCLAIM THEREIN.
 
16.14	Further Assurances.	
The Borrowers shall, and shall cause the other Obligors to, from time to time and at all times hereafter, upon every reasonable request of the Administrative Agent, make, do, execute, and deliver or cause to be made, done, executed and delivered all such further acts,
 
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deeds, assurances and things as may be necessary in the opinion of the Administrative Agent for more effectually implementing and carrying out the true intent and meaning of the Loan Documents or any agreement delivered pursuant thereto and such additional security, legal opinions, consents, approvals, acknowledgements, undertakings, non-disturbance agreements, directions and negotiable documents of title in connection with the property and assets of the Obligors, in form and substance satisfactory to the Administrative Agent, as the Administrative Agent may from time to time request (and to the extent required to be provided by third parties, on a commercially reasonable basis), to ensure (i) that all Secured Assets are subject to a Lien in favour of the Administrative Agent and (ii) the intended first ranking priority of such Liens.
[The remainder of this page is intentionally left blank.]
 
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IN WITNESS WHEREOF the parties hereto have executed this agreement.

Anixter Canada Inc.
c/o Anixter, Inc.
2301 Patriot Boulevard
Glenview, IL 60026	 		 	ANIXTER CANADA INC.	
					
Attention:	 	     Rodney Shoemaker, Treasurer	 		 	By:	 	/s/ Rodney Shoemaker	
Telefax:	 	     (221) 521-8990	 		 	Name:	 	Rodney Shoemaker	
Email:	 	     rod.shoemaker@anixter.com	 		 	Title:	 	Treasurer	
			
Tri-Ed ULC
c/o Anixter, Inc.
2301 Patriot Boulevard
Glenview, IL 60026	 		 	TRI-ED ULC	
					
Attention:	 	     Rodney Shoemaker, Treasurer	 		 	By:	 	/s/ Rodney Shoemaker	
Telefax:	 	     (221) 521-8990	 		 	Name:	 	Rodney Shoemaker	
Email:	 	     rod.shoemaker@anixter.com	 		 	Title:	 	Treasurer	
			
Anixter Mid Holdings B.V.
c/o Anixter, Inc.
2301 Patriot Boulevard
Glenview, IL 60026	 		 	ANIXTER MID HOLDINGS B.V.	
					
Attention:	 	     Rodney Shoemaker, Treasurer	 		 	By:	 	/s/ Rodney Shoemaker	
Telefax:	 	     (221) 521-8990	 		 	Name:	 	Rodney Shoemaker	
Email:	 	     rod.shoemaker@anixter.com	 		 	Title:	 		

									
THE BANK OF NOVA SCOTIA
Corporate Banking - Loan Syndications
40 King Street West, 55 th Floor
Toronto, Ontario M5H 1H1	 		 	THE BANK OF NOVA SCOTIA,
as Administrative Agent	
	    		 		 	By:	 	/s/ Eugene Dempsey	
Attention:	    	Head, Agency Services	 		 	Name:	 	Eugene Dempsey	
Telefax:	    	(416) 866-3329	 		 	Title:	 	Director	
Email:	    	agency.services@scotiabank.com	 		 		 	Corporate Banking	
				
	    		 		 	THE BANK OF NOVA SCOTIA, as Lender	
					
	    		 		 	By:	 	/s/ Eugene Dempsey	
	    		 		 	Name:	 	Eugene Dempsey	
	    		 		 	Title:	 	Director	
	    		 		 		 	Corporate Banking	
					
	    		 		 	By:	 	 	
	    		 		 	Name:	 		
	    		 		 	Title:	 		

									
	 		 		 	BANK OF AMERICA, N.A., CANADA BRANCH, as Lender	
					
	 		 		 	By:	 	/s/ Medina Sales de Andrade	
	 		 		 	Name:	 	Medina Sales de Andrade	
	 		 		 	Title	 	Vice President	
					
	 		 		 	By:	 	 	
	 		 		 	Name:	 		
	 		 		 	Title:	 		

SCHEDULE A
INDIVIDUAL COMMITMENTS

Name and Address of Lender	  	 	  	Individual Commitments	
The Bank of Nova Scotia	  		  	RT Facility: $25,000,000	
Corporate Banking	  		  		
650 West Georgia Street, 18 th Floor	  		  	NRT Facility: $150,000,000	
Vancouver, British Columbia V6B 4N7	  		  		
Attention:	    	Eugene Dempsey, Director &
Execution Head	  		  		
Telefax:	    	(604) 697-2200	  		  		
Email:	    	eugene.dempsey@scotiabank.com	  		  		
			
Bank of America, N.A., Canada Branch	  		  	RT Facility: Nil	
181 Bay Street, Suite 400	  		  		
Toronto, Ontario M5J 2V8	  		  	NRT Facility: $150,000,000	
				
Attention:	    	Medina Sales De Andrade, Vice President	  		  		
Telefax:	    	(416) 369-8148	  		  		
Email:	    	medina.sales_de_andrade@baml.com	  		  		
 
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