Document:

EX-4.3

 Exhibit 4.3 
 REGISTERED 
 No. 
 PHILIP MORRIS INTERNATIONAL INC. 
  

					
	  	 	4.125% NOTES DUE 2043	  	PRINCIPAL AMOUNT
		 		  	$
		 		  	CUSIP NO. 718172 AW9
		 		  	ISIN NO. US718172AW92

 THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED
TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST COMPANY (THE
“DEPOSITARY”) TO A NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 
 PHILIP MORRIS INTERNATIONAL INC., a Virginia corporation
(hereinafter called the “Company”, which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co. or registered assigns, the principal sum of
$                 on March 4, 2043, and to pay interest thereon from March 4, 2013 or from the most recent Interest Payment Date to which interest has been
paid or duly provided for, semi-annually in arrears on March 4 and September 4, in each year, commencing September 4, 2013, at the rate of 4.125% per annum until the principal hereof is paid or made available for payment.

 The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be February 17 or August 20 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date. Any such interest 

 
not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date and may be paid to the Person in whose name this Note (or one or more
Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee for the Notes, notice whereof shall be given to Holders of Notes not less than 10 days
prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in said Indenture. 
 Payment of the principal of (and premium, if any) and interest on this Note
will be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of
public and private debts; provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear on the Securities Register or by
wire transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least 15 days prior to the date for payment by the person entitled thereto. All payments of principal,
premium, if any, and interest in respect of this Note will be made by the Company in immediately available funds. 
 Additional
provisions of this Note are contained on the reverse hereof, and such provisions shall have the same effect as though fully set forth in this place. 
 Unless the certificate of authentication hereon has been executed by or on behalf of the Trustee for the Notes by manual signature, this Note shall not be entitled to any benefit under the Indenture, or
be valid or obligatory for any purpose. 

 IN WITNESS WHEREOF, PHILIP MORRIS INTERNATIONAL INC. has caused this instrument to be duly
executed. 
  

					
	Dated:  March 4, 2013	 	
	
	PHILIP MORRIS INTERNATIONAL INC.
			
	By:	 	  
	 	

 
					
	Name:	 	Marco Kuepfer
	Title:	 	Vice President Finance and Treasurer

 
					
	
	Attest:

 
					
			
	By:	 	  
	 	

 
					
	Name:	 	Markus R. Mueller
	Title:	 	Assistant General Counsel and
		 	Assistant Corporate Secretary

 CERTIFICATE OF AUTHENTICATION 

This is one of the Securities of the series designated therein described in the within-mentioned Indenture. 

 

					
	HSBC BANK USA, NATIONAL ASSOCIATION,
	as Trustee	 	
			
	By:	 	  
	 	
		 	Authorized Officer	 	

  
 4.125%
Notes due 2043 - No. 

 (Reverse of Note) 
 PHILIP MORRIS INTERNATIONAL INC. 
 This Note is one of a duly authorized issue of
debentures, notes or other evidences of indebtedness (hereinafter called the “Securities”) of the Company of the series hereinafter specified, which series is limited in aggregate principal amount to $850,000,000 (except as provided in the
Indenture hereinafter mentioned), all such Securities issued and to be issued under an Indenture dated as of April 25, 2008 between the Company and HSBC Bank USA, National Association, as Trustee (herein called the “Indenture”), to
which Indenture and all other indentures supplemental thereto reference is hereby made for a statement of the rights and limitations of rights thereunder of the Holders of the Securities and of the rights, obligations, duties and immunities of the
Trustee for each series of Securities and of the Company, and the terms upon which the Securities are and are to be authenticated and delivered. As provided in the Indenture, the Securities may be issued in one or more series, which different series
may be issued in various aggregate principal amounts, may mature at different times, may bear interest, if any, at different rates, may be subject to different redemption provisions, if any, may be subject to different sinking, purchase or analogous
funds, if any, may be subject to different covenants and Events of Default and may otherwise vary as in the Indenture provided or permitted. This Note is one of a series of the Securities designated therein as 4.125% Notes due 2043 (the
“Notes”). 
 Section 1010 of the Indenture shall be applicable to the Notes, except that (i) the term
“Holder,” when used in Section 1010 of the Indenture, shall mean the beneficial owner of a Note or any person holding on behalf or for account of the beneficial owner of a Note; (ii) the following language shall replace
subsection (k) to Section 1010 of the Indenture “any tax, assessment or other governmental charge imposed pursuant to the provisions of Sections 1471 through 1474 of the Code” and (iii) the following language shall be
included as subsection (l) to Section 1010 of the Indenture “any combination of items (a), (b), (c), (d), (e), (f), (g), (h), (i), (j) and (k).” 
 The Company may redeem the Notes prior to maturity in whole, but not in part, on not more than 60 days’ notice and not less than 30 days’ notice at a redemption price equal to the principal
amount of such Notes plus any accrued interest and additional amounts to the date fixed for redemption if: 
  

	 	—	 	 as a result of a change in or amendment to the tax laws, regulations or rulings of the United States or any political subdivision or taxing authority
of or in the United States or any change in official position regarding the application or interpretation of such laws, regulations or rulings (including a holding by a court of competent jurisdiction in the United States) that is announced or
becomes effective on or after March 4, 2013, the Company has or will become obligated to pay additional amounts with respect to the Notes as described in Section 1010 of the Indenture, or 

 

	 	—	 	 on or after March 4, 2013, any action is taken by a taxing authority of, or any decision is rendered by a court of competent jurisdiction in, the
United States or 

	 	 
any political subdivision or taxing authority of or in the United States, including any of those actions specified in the bullet point above, whether or not such action is taken or decision is
rendered with respect to the Company, or any change, amendment, application or interpretation is officially proposed, which, in any such case, in the written opinion of independent legal counsel of recognized standing, will result in a material
probability that the Company will become obligated to pay additional amounts with respect to the Notes, 

 and the Company in
its business judgment determines that such obligations cannot be avoided by the use of reasonable measures available to the Company. 
 If the Company exercises its option to redeem the Notes, the Company will deliver to the Trustee a certificate signed by an authorized officer stating that it is entitled to redeem the Notes and the
written opinion of independent legal counsel if required. 
 The Indenture contains provisions for defeasance at any time of the
entire principal of all the Securities of any series upon compliance by the Company with certain conditions set forth therein. 

If an Event of Default (other than an Event of Default described in Section 501(4) or 501(5) of the Indenture) with respect to the
Notes shall occur and be continuing, then either the Trustee or the Holders of at least 25% in aggregate principal amount of the Securities of all series then Outstanding (or, if such default is not applicable to all series of the Securities, the
Holders of at least 25% in principal amount of the then Outstanding Securities of all series to which it is applicable) (in each case voting as a single class) may declare the entire principal amount of the Securities of all series so affected due
and payable in the manner and with effect provided in the Indenture. If an Event of Default specified in Section 501(4) or 501(5) occurs with respect to the Company, all of the unpaid principal amount and accrued interest then Outstanding shall
ipso facto become and be immediately due and payable in the manner with the effect provided in the Indenture without any declaration or other act by the Trustee or any Holder. 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities under the Indenture at any time by the Company with the consent of the Holders of not less than a majority in aggregate principal amount of the Outstanding Securities of all
series of Securities affected thereby (voting as a single class). The Indenture also contains provisions permitting the Holders of specified percentages in aggregate principal amount of the Securities of all series affected thereby at the time
Outstanding (voting as a single class) to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences to the affected series. Any such consent or waiver by the Holder
of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the transfer hereof or in exchange or in lieu hereof whether or not notation of such consent or waiver is made upon
this Note. 
 No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay 

 
the principal of (and premium, if any) and interest on this Note at the times, place and rate, and in the coin or currency, herein and in the Indenture prescribed. 

As provided in the Indenture and subject to certain limitations therein set forth, this Note is transferable on the Security Register of
the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company to be maintained for that purpose in the Borough of Manhattan, The City of New York, or at any other office or agency of the Company
maintained for that purpose, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by the Holder hereof or his or her attorney duly authorized in writing,
and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. 
 The Notes are issuable only in registered form in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. As provided in the Indenture and subject to certain limitations therein set
forth, Notes are exchangeable for a like aggregate principal amount of Notes of a like tenor and of a different authorized denomination, as requested by the Holder surrendering the same. 

No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection therewith. 
 The Company, the Trustee for the
Notes and any agent of the Company or such Trustee may treat the Person in whose name this Note is registered as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Note be
overdue, and neither the Company, such Trustee nor any such agent shall be affected by notice to the contrary. 
 Certain of the
Company’s obligations under the Indenture with respect to Notes may be terminated if the Company irrevocably deposits with the Trustee money or Government Obligations sufficient to pay and discharge the entire indebtedness on all Notes, as
provided in the Indenture. 
 This Note shall for all purposes be governed by, and construed in accordance with, the laws of
the State of New York. 
 Certain terms used in this Note which are defined in the Indenture have the meanings set forth
therein. 

 ASSIGNMENT FORM 
 FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto 
 PLEASE INSERT
SOCIAL SECURITY NUMBER OR 
 OTHER IDENTIFYING NUMBER OF ASSIGNEE 

 
  
   (Name and address of Assignee, including zip code, must be printed or typewritten) 
  

 
  

 
 the within Note, and all rights thereunder,
hereby irrevocably, constituting and appointing 
  
  

 
  
 Attorney to transfer the said Note on the books of Philip Morris International Inc. with full power of substitution in the premises. 

 

							
	Dated:	 	  
	  		  	
		 		  		  	  

		 		  	NOTICE: The signature to this assignment must correspond with the name as it appears upon the face of the within Note in every particular, without alteration or
enlargement or any change whatsoever.EX-10.21

 Exhibit 10.21 
 AMENDMENT #4 
 TO 

AGREEMENT FOR INVENTORY FINANCING 
 This AMENDMENT (“Amendment”) to AGREEMENT FOR INVENTORY FINANCING is made as of May 11, 2006 by and between PC Connection, Inc., a corporation, duly organized under the laws
of the State of Delaware (“PC Connection”), Merrimack Services Corporation a corporation, duly organized under the laws of the State of Delaware (“Merrimack”), GovConnection, Inc., a corporation, duly
organized under the laws of the State of Maryland (“GovConnection”), and MoreDirect, Inc., a corporation, duly organized under the laws of the State of Florida (“MoreDirect”) (PC Connection, Merrimack, GovConnection
and MoreDirect are referred to herein as a “Customer” or, collectively, the “Customers”) and IBM Credit LLC, a Delaware limited liability company, formerly IBM Credit Corporation (“IBM Credit”). 

RECITALS: 

WHEREAS, the Customer and IBM Credit have entered into that certain Agreement for Inventory Financing dated as of October 31,
2002 (as amended, supplemented or otherwise modified from time to time, the “Agreement”); and 
 WHEREAS, The
parties have agreed to modify the Agreement as more specifically set forth below, upon and subject to the terms and conditions set forth herein. 
 AGREEMENT 
 NOW THEREFORE, in consideration of the premises and
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Customer and IBM Credit hereby agree as follows: 
 Section 1. Definitions. All capitalized terms not otherwise defined herein shall have the respective meanings set forth in the Agreement. 

Section 2. Amendment. The Agreement is hereby amended as follows: 
 A. Schedule 1 to Attachment A has been added. 
 B. Section 1.1
of the Agreement is hereby amended by deleting the definition of Maximum Advance Amount in its entirety and substituting, in lieu thereof, the following new definition: 
 ““Maximum Advance Amount”: the lesser of (1) the Credit Line and (2) the Borrowing Base at such time; provided, however that if IBM Credit notifies the Customer in writing that
the Customer has met or exceeded the Flexibility Criteria then the Maximum Advance Amount shall be the Credit Line until such time as IBM Credit notifies the Customer that the Customer no longer satisfies the Flexibility Criteria, in IBM
Credit’s sole determination.” 
 C. Section 1.1 of the Agreement is hereby amended by adding the following
new definition: 
 “Flexibility Criteria”: shall mean the conditions set forth on Schedule 1 to Attachment A as IBM Credit may modify
such Schedule 1 from time to time in its reasonable discretion without the consent of the Customer.” 

 D. Section 4.1 of the Agreement is hereby amended by deleting such section in
its entirety and substituting, in lieu thereof, the following new section: 
 “4.1. Grant. To secure Customers’ full and
punctual payment and performance of the Obligations (including obligations under any leases Customer may enter into, now or in the future, with IBM Credit) when due (whether at the stated maturity, by acceleration or otherwise), each Customer hereby
grants IBM Credit a security interest in all of such Customer’s right, title and interest in and to the following, whether now owned or hereafter acquired or existing and wherever located: 

(A) all goods manufactured or sold by International Business Machines Corporation (“IBM”), or Lenovo (United States) Inc.
(“Lenovo”), or Lexmark International, Inc. (“Lexmark”), or bearing the trademarks or trade names of IBM, or Lenovo, or Lexmark, including, inventory and equipment and all parts thereof, attachments, accessories and accessions
thereto, products thereof and documents therefor, but excluding, however, each Customer’s capital equipment; 
 (B) all
price protection payments, credits, discounts, incentive payments, rebates, and refunds which at any time are due to Customers with respect to or in connection with any inventory and equipment described in (A) above; 

(C) all substitutions and replacements for all of the foregoing, and all products and cash proceeds of all of the foregoing and, to the
extent not otherwise included, all payments under insurance or any indemnity, warranty or guaranty, payable by reason of loss or damage to or otherwise with respect to any of the foregoing. 
 All of the above assets shall be collectively defined herein as the “Collateral”. 
 Each
Customer covenants and agrees with IBM Credit that: (a) the security constituted to by this Agreement is in addition to any other security from time to time held by IBM Credit; (b) the security hereby created is a continuing security
interest and will cover and secure the payment of all Obligations both present and future of Customers to IBM Credit; and (c) any transfer of Collateral between GovConnection, Merrimack and MoreDirect is subject to IBM Credit’s continuing
security interest in the Collateral of the transferor as well as IBM Credit’s continuing security interest in the Collateral of the transferee.” 
 E. Section 7.1. (J) of the Agreement is hereby amended by deleting such section in its entirety and substituting, in lieu thereof, the following new section: 

“(J) if the Customer at any time ceases to meet or exceed the Flexibility Criteria, Customer shall provide a Collateral Management Report as of a
date no earlier than the last day of the immediately preceding month, within 5 days of IBM Credit’s request, and each month thereafter by the fifth (5th) day of each month, or as otherwise agreed in writing;” 

Section 3. Notice. Customer is hereby notified that, as of the execution date of this Amendment, Customer meets or exceeds the
Flexibility Criteria. 
 Section 4. Representations and Warranties. Customer makes to IBM Credit the following representations and
warranties all of which are material and are made to induce IBM Credit to enter into this Amendment. 
 Section 4.1 Accuracy and
Completeness of Warranties and Representations. All representations made by Customer in the Agreement were true and accurate and complete in every respect as of the date made, and, as amended by this Amendment, all representations made by
Customer in the Agreement are true, accurate and complete in every material respect as of the date hereof, and do not fail to disclose any material fact necessary to make representations not misleading. 

Section 4.2 Violation of Other Agreements. The execution and delivery of this Amendment and the performance and observance of the covenants
to be performed and observed hereunder do not violate or cause Customer not to be in compliance with the terms of any agreement to which Customer is a party. 

 Section 4.3 Litigation. Except as has been disclosed by Customer to IBM Credit in writing, there
is no litigation, proceeding, investigation or labor dispute pending or threatened against Customer, which, if adversely determined, would materially adversely affect Customer’s ability to perform Customer’s obligations under the Agreement
and the other documents, instruments and agreements executed in connection therewith or pursuant hereto. 
 Section 4.4 Enforceability
of Amendment. This Amendment has been duly authorized, executed and delivered by Customer and is enforceable against Customer in accordance with its terms. 
 Section 5. Ratification of Agreement. Except as specifically amended hereby, all of the provisions of the Agreement shall remain unamended and in full force and effect. Customer hereby
ratifies, confirms and agrees that the Agreement, as amended hereby, represents a valid and enforceable obligation of Customer, and is not subject to any claims, offsets or defenses. 
 Section 6. Governing Law. This Amendment shall be governed by and interpreted in accordance with the laws which govern the Agreement. 
 Section 7. Counterparts. This Amendment may be executed in any number of counterparts, each of which shall be an original and all of which shall constitute one agreement. 

 IN WITNESS WHEREOF, this Amendment has been executed by duly authorized officers of
the undersigned as of the day and year first above written. 
  

									
	IBM Credit LLC	 		 	PC Connection, Inc.
					
	By:	 	 /S/ THOMAS HARAHAN 
	 		 	By:	 	 /S/ JACK FERGUSON

					
	Print Name:	 	 Thomas Harahan 
	 		 	Print Name:	 	 Jack Ferguson 

					
	Title:	 	 Senior Credit Officer 
	 		 	Title:	 	 CFO and Treasurer

			
	Merrimack Services Corporation	 		 	GovConnection, Inc.
					
	By:	 	 /S/ JACK FERGUSON
	 		 	By:	 	 /S/ GARY ANDERSON

					
	Print Name:	 	 Jack Ferguson 
	 		 	Print Name:	 	 Gary Anderson 

					
	Title:	 	 Treasurer
	 		 	Title:	 	 Treasurer

				
	MoreDirect, Inc.	 		 		 	
					
	By:	 	 /S/ GARY ANDERSON
	 		 		 	
					
	Print Name:	 	 Gary Anderson 
	 		 		 	
					
	Title:	 	 Treasurer
	 		 		 	

 ATTACHMENT A 
 TO 
 AGREEMENT FOR INVENTORY FINANCING 

DATED OCTOBER 31, 2002 

EFFECTIVE DATE OF THIS : OCTOBER 31, 2002 

Section 1: LOAN PARTIES: 
  

			
	 NAME:
	  	ORGANIZATION NO. (Assigned by State of Org)
		
	 PC Connection, Inc.
	  	Delaware File Number 3149279
	 Merrimack Services Corporation
	  	Delaware File Number 3149077
	 GovConnection, Inc.
	  	Maryland ID Number 03712387
	 MoreDirect, Inc.
	  	Florida File Number P9400072462

 Section 2: FEES, RATES AND REPAYMENT TERMS: 

(A) Credit Line: Twenty-five Million Dollars ($25,000,000.00); 
 (B) Borrowing Base: 
 (i) 100% of the Customer’s inventory in
the Customer’s possession as of the date of determination as reflected in the Customer’s most recent Collateral Management Report constituting Products (other than service parts) financed through a Product Advance by IBM Credit, so long as
(i) IBM Credit has a first priority security interest in such Products; (ii) such Products are in new and unopened boxes, and (iii) the invoice date reflecting the sale of such Products by Authorized Supplier is not greater than one
hundred eighty (180) days prior to the date of determination. The value to be assigned to such inventory shall be based upon the Authorized Supplier’s invoice price to Customer for Products net of all applicable price reduction credits.

 (C) Inventory Insurance Amount: Twenty-five Million Dollars ($25,000,000.00) 

(D) Delinquency Fee Rate: Prime Rate plus 6.500% 
 (E) Shortfall Transaction Fee: Shortfall Amount multiplied by 0.30% 
 (F) Free
Financing Period Exclusion Fee: For each Product Advance made by IBM Credit pursuant to Customer’s financing plan where there is no Free Financing Period associated with such Product Advance there will be a fee equal to the Free Financing
Period Exclusion Fee. For a 30 day payment plan when Prime Rate is 8% the Free Financing Period Exclusion Fee is 1.08% of the invoice amount. This fee will vary by .0125% with each .25% change in Prime Rate (e.g. Prime Rate of 7.25%, the charge is
1.0425% of the invoice amount). The fee accrues as of the Date of Note and is payable as stated in the billing Statement. 
 Section 3:
FINANCIAL COVENANTS: 
 (A) Definitions: The following terms shall have the following respective meanings in this Attachment.
All amounts shall be determined in accordance with generally accepted accounting principles (GAAP). 
 “Consolidated EBIT” shall mean
for any period the sum of (a) Consolidated Net Income and (b) all amounts deducted in computing Consolidated Net Income in respect of (i) interest expense on Indebtedness and (ii) taxes based on or measured by income, in each
case for the period under review. 
 “Consolidated EBITDA” shall mean the sum of (a) Consolidated EBIT, plus (b) the
aggregate amount of consolidated depreciation and amortization expense plus (c) non-cash extraordinary or non-recurring losses less (d) extraordinary or non-recurring gains. 

 “Consolidated Net Income” shall mean, for any period, the net income (or loss), after taxes, of PC
Connection and subsidiaries on a consolidated basis for such period determined in accordance with GAAP. 
 “Consolidated Net Worth”
(the amount of owner’s or stockholder’s ownership in an enterprise) is equal to Consolidated Total Assets minus Consolidated Total Liabilities. 
 “Current” shall mean within the ongoing twelve month period. 
 “Current
Assets” shall mean assets that are cash or expected to be expensed or become cash within the ongoing twelve months. 
 “Current
Liabilities” shall mean payment obligations resulting from past or current transactions that require settlement within the ongoing twelve month period. All indebtedness to IBM Credit shall be considered a Current Liability for purposes of
determining compliance with the Financial Covenants. 
 “EBITDA” shall mean, for any period (determined on a consolidated basis in
accordance with GAAP), (a) the Consolidated Net Income for such period, plus (b) each of the following to the extent reflected as an expense in the determination of such Consolidated Net Income: (i) provisions for taxes based on
income for such period; (ii) Interest Expense for such period; and (iii) depreciation and amortization of tangible and intangible assets for such period. 
 “Funded Debt Ratio”: shall mean, with respect to any fiscal quarter, the ratio of (a) the average daily outstanding Advances over such fiscal quarter under the Second Amended and Restated
Credit and Security Agreement dated June 29, 2005 by and among PC Connection and its subsidiaries, inc. and Citizens Bank of Massachusetts and the other parties thereto to (b) the rolling four fiscal quarter Consolidated EBITDA (including
such fiscal quarter) of Customers. 
 “Interest Expense” shall mean, for any period, the aggregate consolidated interest expense of PC
Connection and subsidiaries during such period in respect of Indebtedness determined on a consolidated basis in accordance with GAAP, including, without limitation, amortization of original issue discount on any Indebtedness and of all fees payable
in connection with the incurrence of such Indebtedness (to the extent included in interest expense), the interest portion of any deferred payment obligation and the interest component of any capital lease obligations. 

“Long Term” shall mean beyond the ongoing twelve month period. 
 “Long Term Assets” shall mean assets that take longer than a year to be expensed or converted to cash. They are divided into four categories: tangible assets, investments, intangibles and other.

 “Long Term Debt” shall mean payment obligations of indebtedness which mature more than twelve months from the date of
determination, or mature within twelve months from such date but are renewable or extendible at the option of the debtor to a date more than twelve months from the date of determination. 
 “Revenue” shall mean the monetary expression of the aggregate of products or services transferred by an enterprise to its customers for which said customers have paid or are obligated to pay,
plus other income as allowed. 
 “Subordinated Debt” shall mean PC Connection’s indebtedness to third parties as evidenced by an
executed Notes Payable Subordination Agreement in favor of IBM Credit. 
 “Total Assets” shall mean the total of Current Assets and
Long Term Assets. 

 “Total Liabilities” shall mean the Current Liabilities and Long Term Debt less Subordinated Debt,
resulting from past or current transactions, that require settlement in the future. 
 “Total Net Worth” (the amount of owner’s
or stockholder’s ownership in an enterprise) is equal to Total Assets minus Total Liabilities. 
 “Working Capital” shall mean
Current Assets minus Current Liabilities. 
 (B) PC Connection will be required to maintain the following financial ratios,
percentages and amounts as of the last day of the fiscal period under review by IBM Credit: 
 Minimum Consolidated Net Worth: Maintain a
minimum Consolidated Net Worth of (i) $150,000,000 plus (ii) on a cumulative basis, an amount equal to fifty percent (50%) of the Consolidated Net Income in each quarter thereafter, commencing with the fiscal quarter ended
December 31, 2005. 
 Maximum Funded Debt Ratio: Maintain a Funded Debt Ratio of not greater than 2.0:1.0. 

Section 4: ADDITIONAL CONDITIONS PRECEDENT PURSUANT TO SECTION 5.1H OF THE AGREEMENT: 

(i) Executed Collateralized Guaranty of PC Connection Sales Corporation on behalf of the Customers 

(ii) Executed Collateralized Guaranty of PC Connection, Inc. on behalf of the Customers; 

(iii) Executed Waiver of Landlord Lien for all premises in which a landlord has the right of levy for rent; 

(iv) Fiscal year-end consolidated financial statements of PC Connection together with the consolidated financial
statements as of end of PC Connection’s prior fiscal year audited by an independent certified public accountant; 
 (v) Compiled fiscal quarter-end consolidated financial statements of PC Connection( as of end of PC Connection’s prior fiscal quarter; 

(vi) A Certificate of Location of Collateral whereby the Customers certify where Customers presently keep or sell
Collateral; 
 (vii) Subordination or Intercreditor Agreements from all creditors having a lien which is superior
to IBM Credit in any assets that IBM Credit relies on to satisfy the Loan Party’s obligations to IBM Credit; 
 (viii) A Collateral Management Report in the form of as of the most recent scheduled report date; 
 (ix) A Compliance Certificate in the form of as to PC Connection’s compliance with the financial covenants set forth in as of the last fiscal quarter of PC Connection for which financial statements
have been published; 
 (x) A Corporate Secretary’s Certificate substantially in the form and substance of
certifying to, among other items, the resolutions of the Loan Party’s Board of Directors authorizing borrowing by each Loan Party; 
 (xi) Termination or release of Uniform Commercial Code filing by another creditor as required by IBM Credit; 
 A copy of an all-risk insurance certificate pursuant to Section 7.8(A) of the Agreement; 

 SCHEDULE 1, to Attachment A 
 AGREEMENT FOR INVENTORY FINANCING DATED October 31, 2002 
 EFFECTIVE
DATE MAY 11, 2006 
 Definition: The following term shall have the following meaning in this Schedule 1, to Attachment A. All amounts shall
be determined in accordance with generally accepted accounting principles (GAAP).* 
  

	*	All definitions not contained herein shall have the respective meanings as set forth in Attachment A. 

“Tangible Net Worth” shall mean: 
 Total Net Worth minus; 
 (a) goodwill, organizational expenses, pre-paid expenses,
deferred charges, research and development expenses, software development costs, leasehold expenses, trademarks, trade names, copyrights, patents, patent applications, privileges, franchises, licenses and rights in any thereof, and other similar
intangibles (but not including contract rights) and other current and non-current assets as identified in Customer’s financial statements; 
 (b) all accounts receivable from employees, officers, directors, stockholders and affiliates; and 
 (c) all callable/redeemable preferred stock. 
 In order for the Flexibility Criteria to be
satisfied in IBM Credit’s determination, the Customer shall maintain the following financial ratios, percentages and amounts as of the last day of the fiscal period under review by IBM Credit. 

 

	(A)	Revenues (annualized) greater than $500 million; 

  

	(B)	Tangible Net Worth greater than $100 million; and 

  

	(C)	Total Liabilities to Tangible Net Worth less than 2.0:1.0

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