FINANCIAL AND ACCOUNTING INFORMATION As a result of this agreement, credit risk, interest risk servicing agreement in relation to derecognized and late payments risk attached to the receivables receivables and not yet transferred to the purchaser assigned in relation to the Ester program are totaled €33.2 million and was recognized in financial transferred to the purchaser through the credit and liabilities (€37.4 million as of December 31, 2016). funding discounts. The dilution risk is not considered The Group did not retain any interests in the for risks and rewards analysis as this risk is not receivables sold under this program. attached to the receivables but is analyzed as a risk of misuse of the securitization program as disputed Securitization programs are subject to certain receivables are not eligible to the program or as a covenants concerning the qual ity of the trade risk attached to the servicing of the receivables that receivables portfol io including dilution (ratio of is guaranteed by a collateral. Therefore, receivables credit notes to eligible receivables), delinquency and sold under this agreement are derecognized from default criteria (aging ratios measured respectively the balance-sheet at the transfer date. as overdue and doubtful receivables to el igible The difference between the sale price and the receivables). As of December 31, 2017, Rexel had carrying value of these receivables is recorded in satisfied all of these covenants. All the programs are the income statement as a financial expense. on-going programs and therefore are not subject to seasonality other than seasonality arising in the As of December 31, 2017, derecognized receivables ordinary course of business. totaled €183.3 mi l l ion (€197.7 mi l l ion as of Information with respect to Rexel’s securitization December 31, 2016) and the resulting loss was programs including the off-balance sheet programs recorded as a financial expense for €9.4 mil l ion is provided in the table below: (€7.9 mil l ion in 2016). Cash col lected under the AMOUNT OF RECEIVABLES AMOUNT BALANCE AS OF ASSIGNED DRAWN AS OF DOWN AS OF DECEMBER 31, DECEMBER 31, COMMITMENT 2017 2017 2017 2016 REPAYMENT PROGRAM (in millions of currency) (in millions of euros) DATE Europe and Australia EUR 375.0(1) EUR 506.1 EUR 376.0 376.0 367.9 12/16/2020 Europe EUR 309.0(2) EUR 424.9 EUR 288.3 288.3 350.6 11/20/2019 United States USD 515.0 USD 650.3 USD 491.8 410.1 441.9 12/20/2019 Canada CAD 175.0 CAD 252.5 CAD 175.0 116.4 123.3 01/18/2019 TOTAL 1,190.8 1,283.7 Of which: • on balance sheet 1,007.6 1,085.9 • off balance sheet 183.3 197.8 (1)I n November 2017, Rexel amended its European and Australian program to extend the maturity date to December 2020. (2) I n November 2017, Rexel amended its European securitization program to remove Belgian trade receivables. As a result, the maximum commitment was reduced from €354.0 million to €309.0 million. These securitization programs pay interest at trade receivables. Rexel transfers risks and benefits variable rates including a specific credit spread associated with discounted Bank Acceptance to each program. As of December 31, 2017, the Drafts. As of December 31, 2017, Bank Acceptance total outstanding amount authorized for these Drafts were derecognized from the balance sheet securitization programs was €1,229.8 mil l ion, of for €55.9 million (€56.7 million as of December 31, which €1,190.8 million were used. 2016). 22.1.4 Promissory notes 22.1.5 Factoring arrangements In order to manage its credit risk in China, the In addition to its securitization programs, Rexel Group discounts with no recourse to various entered into factoring agreements in France and financial institutions non-matured promissory Belgium. Under these arrangements, Rexel assigns notes issued by banks (“Bank Acceptance Drafts”) trade receivables to the factor and receives cash that are received from customers as payment of payment for a maximum amount of €95 million. REXEL 2017 – REGISTRATION DOCUMENT 258