Exhibit 10.1

Translation from French to English

 

SCHEDULE 1  

AGREEMENT FOR THE FINANCING WITHOUT RECOURSE OF COMMERCIAL RECEIVABLES BY

SUBROGATORY TRANSFER

BETWEEN: OFFICE DEPOT BS, a French simplified limited company (SAS) with share
capital of 148.568.500 €, whose registered office is located in SENLIS (60300),
126, avenue du Poteau, registered with the Trade and Companies Registry under
number ° 324 559 970, hereinafter referred to as the Client,

AND: FORTIS COMMERCIAL FINANCE, a French simplified limited company (SAS) with
share capital of € 33,865,055 whose registered office is located at 30, Quai de
Dion Bouton, PUTEAUX (92800) registered with the Trade and Companies Registry
under number 342 227 576, hereinafter referred to as FCF,

Article 1: Purpose / Scope of the agreement

 

The present Agreement allows the Client to obtain from FCF the financing, by
subrogatory transfer without recourse, of any commercial receivables arising
from its activity of supply of office products and furniture up to the amount
specified at article 7.

To be eligible for the present Agreement, said receivables (the «Eligible
Receivables») must meet all the following criteria:

 

-  

Certain, liquid and denominated in euros,

 

-  

Corresponding to firm sales subject to effective deliveries or to achieved
provision of services,

 

-  

For which payment terms are complying with the legal regulations in force and in
any case, not exceeding 180 days following the invoice date,

 

-  

On all kind of debtors located in France metropolitan (excluding private
individuals, debtors which are equally the Client’s suppliers of office
furniture and articles, or Office-Depot group members).

The compliance with the conditions of eligibility of the transferred receivables
is the Client’s responsibility, FCF not having any control to operate; it being
clarified that the Client will communicate to FCF, on its demand, any document
or any useful information in connection with the operations.

The Client refrains from entering into any agreement (mobilization of
receivables, factoring or other) allowing a third party to come into competition
with FCF with regards to the Eligible Receivables.

Article 2: Current account Agreement

 

The transactions handled pursuant to the present Agreement are recorded in a
current account opened in the name of the Client in the books of FCF; the sums
due by FCF as well as all sums due by the Client pursuant to the present
Agreement are recorded in such current account (the “Current Account”).

The reciprocal discounts, debts and receivables recorded in the Current Account
constitute solely account entries, all such entries being indivisibly merged.
Any debit balance arising from this merger will be immediately due and every
credit balance will be immediately available.

The Client and FCF agree that the aforementioned reciprocal receivables and
debts arising from the performance of the present Agreement are related and
indivisible, in such a way that they constitute each other’s guarantee and do
mutually set off with one another whereas the conditions required for legal
compensation would not be met.

There may be opened as many sub-current-accounts in the name of the Client as
necessary, which will all be part of the Current Account.

The Client’s Current Account does not contain any overdraft authorization.
Should a debit position be attained, in particular in respect of the payment of
any receivables held by FCF against the Client, FCF is entitled to claim
immediately the repayment of the corresponding amounts to the Client.

FCF shall send monthly to the Client a Current Account statement. Each statement
will be deemed to reflect the reality and the accuracy of the operations between
the Client and FCF, except for obvious errors or motivated and justified
disputes, notified by the Client to FCF within 60 days as from the notification
date. Should the monthly comparing

 

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Translation from French to English

 

carried out by the Client between its subsidiary accounting of Receivables and
the Current Account reveal any differences, the Client undertakes to proceed to
all usual verifications and to inform FCF without delay of the results of its
verifications.

The termination of the Agreement opens the closure period of the Current Account
starting as from the date of notification of the termination. The definitive
closure and the balance of the Current Account shall only be established subject
to the settlement of all pending operations.

Article 3: Remittance of Receivables - Transfer of property

 

The Client transfers to FCF, on a weekly basis, and under a specification agreed
by FCF, the list of the Eligible Receivables.

Transfer of title of the Eligible Receivables is made by means of conventional
subrogation in accordance with article 1250-1° of the French Civil Code. By
crediting the Current Account of the amount of the receivables transferred by
the Client and which are listed in the summary forms, FCF becomes the sole
holder of the title of the aforementioned receivables as a result and as from
the day of their registration in the account. The amount of the transferred
receivables is inscribed to the credit of the current account within 48 hours of
the reception of the form at the latest.

To that effect, the Client shall sign upon the activation of the Agreement at
the latest, a permanent subrogation form (quittance subrogative permanente) in
favor of FCF, of which a template is appended to the present Agreement (Annex
3).

FCF is entitled to request at any time the provision of any document on the
transferred receivables, in particular invoice, purchase orders (except for
phone orders) and delivery notes. The Client has 30 days to deliver the
documents. In particular instances, FCF may request the Client to do its best
efforts to deliver the documents as soon as possible.

Article 4: Receivable management mandate

 

4-1: Purpose of Mandate

FCF hereby gives mandate to the Client to collect and receive payments regarding
the transferred receivables. This mandate will not lead any obligation of
payment from FCF; expenses and outlays of any kind will stay at the charge of
the Client.

The procedures communicated by the Client to FCF during the diligences made
prior to the signature of the present Agreement are attached to the Agreement.
Any significant change to such procedures must firstly be accepted by FCF. The
Client commits to apply the credit and collection procedures mentioned in Annex
6 and generally to exercise due care to protect FCF’s rights.

The Client is dispensed of informing its debtors of the existence of the present
agreement and of affixing on its invoices any clause of transfer (clause à
ordre).

4-2: Payments

The payment instruments received by the Client for the transferred receivables
shall be remitted on a dedicated bank account opened at Fortis Bank. The LCR and
other kind of bills of exchange shall be remitted on the dedicated bank account
by the Client at the date of invoice issuing or on receipt.

Debtor payments made by bank transfers shall be domiciliated on the bank
accounts of the Client opened at BSD-CIN LA BANQUE POSTALE, LCL and BNP, named
cashing accounts; for whatever purposes it may serve the claims in restoration
of the balances of these accounts will have firstly been transferred to FCF in
accordance with articles L. 313-23 & following of the Monetary and Financial
code further to a security document which shall be signed at the latest upon the
date of the first remittance of receivables. The template for the assignment
agreement of professional receivables is appended as annex 4 and the templates
for protocols regarding the operation of the cashing accounts are appended as
annex 5. The references of the said cashing accounts will be reported on
original invoices, and the balances of the cashing accounts will be transferred
daily to the dedicated bank account, pursuant to an ad hoc agreement signed
between the parties and the domiciled bank. It is understood that any credit
transfer corresponding to a transferred receivable, received on any bank account
other than the cashing bank account shall be immediately transferred to the
dedicated account.

Pursuant to the terms of a particular functioning agreement to be concluded with
each of the aforementioned banks, the Client refrains to operate those cashing
accounts on debit or to change the domiciliation of the payments before having
obtained previous agreement from FCF.

 

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4-3: Power

The Client grants FCF full powers to endorse all payment title that might be
made out to the order of the Client. The Client undertakes not to revoke such
powers for so long as its current account in FCF’s books remains open. The power
shall be used by FCF only in case the mandate is revoked.

4-4: Reporting

The Client shall report, at the first remittance of receivables and at least
twice a month, on the performance of the mandate by communicating to FCF the
information described below in a format agreed by the Parties (for that purpose,
FCF supplies the Client with a specification allowing it to prepare the
corresponding files) :

- Itemized outstanding balance of the non identified debtors included in the
scope of the agreement; the Client shall retain the invoices sold by bills of
exchange payable in the balance forwarded to FCF.

- Actualized list of active debtors included in the scope of the application.

- Summary of the amount of the dilutions of the past 15 days. Generally,
dilution are defined as any entry lessening the amount of the receivables
transferred without cash counterpart on the dedicated bank account and more
particularly as credit notes, discounts, rebates on the turnover, participation
to advertisement, direct payments (except for purchase cards) and disputes
(non-payment by a debtor for any other reason than insolvency as described in
article 6 of the present Agreement as soon as the Client is being made aware of
it and at the latest 120 days from the due date ).

- List of the bad debts accounted over the last elapsed fifteen days and
registered in the “416” account category.

- Actualized statement of the provisions for end of year rebates and
participation to advertisement.

According to the collected elements, FCF will compare the existing ledger in its
books to the ledger transmitted by the Client; FCF is authorized to settle any
unjustified difference by debiting the Statistical Dilution Reserve as defined
in article 6 below.

In general, the Client acknowledges that FCF has the right to conduct any
necessary verification regarding the transferred receivables including on its
premises and books, after the appointment made with the Client to be decided
within 48 business hours from the request of FCF, except in case of justified
emergency. The Client hereby agrees to do everything in its power to cooperate
with the conduct of such verifications.

4-5: Revocation of the Mandate

FCF may revoke the mandate 15 business days after a formal notice sent by
registered letter with acknowledgment of receipt requested left unremedied in
case:

- The Client’s finances have worsen significantly;

- Dilutions (as defined in article 4-4) exceeding 10 % of the nominal amount VAT
included of the transferred receivables, the calculation being established
according to a method communicated by FCF and attached to the present document
(Annex 7);

- Arrears above 30 days as from the due date exceeding 10% of the outstanding
amount of transferred receivables, after deduction of the unallocated cash, the
calculation being established according to a method communicated by FCF and
attached to the present document (Annex 7);

- DSO noticed in FCF books is above 75 days, according to a method of
calculation communicated by FCF and attached to the present document (Annex 7).

If the mandate is revoked, FCF will have to take over the collection of the
transferred receivables; the Client hereby agrees to do everything to help
assuring the debtors information on the revocation of the mandate and the
notification of the new payment account details. In return of the taking over of
the collection by FCF, the factoring fee will be increased by 0.20%. This
pricing will apply as of the effective date of mandate revocation and will be
applied to all receivable outstanding at this date.

In case Client makes a serious breach of contract, defined as any behavior
likely to prevent FCF from benefiting from its rights according to the present
document, FCF shall have the right to revoke the mandate without previous
notice.

 

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Article 5: Acceptance of debtors

 

On the signature of the present agreement, and then, two times a month, the
Client will transmit to FCF the file of all debtors included in the application
scope, mentioned in article 1. The debtors benefiting from an outstanding credit
granted by the Client at the date of the audit prior to the signing of the
Agreement benefit from a credit approval up to that amount. The new debtors for
whom the outstanding is inferior or equal to €80,000 (eighty thousand)
automatically benefit from a credit approval by default. For any new outstanding
amount above €80,000 (eighty thousand) on a private debtor, the Client shall
transmit to FCF any non confidential information in its possession allowing FCF
to assess the solvency. Failing non confidential information in its possession
is communicated, the approval is deemed refused.

FCF may decide at any time to reduce or terminate acceptance without that this
reduction or termination lessen the amount of the transfer of receivables
authorization of transfer mentioned in article 7 (€60,000,000) granted to the
Client, in which case it shall inform the Client of its decision by any means.
Such decisions shall have immediate effect, although receivables corresponding
to services rendered on or before the date on which the Client received notice
shall continue to be accepted. All decisions to reduce or terminate acceptance
shall have retroactive effect from 0.00 hours on the day of the decision.

The Client acknowledges that FCF’s decisions concerning acceptance are intended
for it alone, and agrees not to disclose them to any third party, including the
relevant debtors.

Article 6: Statistical Dilution Reserve - Guarantee

 

FCF guarantees the risk of declared insolvency and default of payment of the
debtors pursuant to the conditions stated herein. Recordation of receivables to
the credit of the Current Account does not imply that such receivables are
guaranteed. The non guaranteed receivables can be debited from the Current
Account at any time.

The Client agrees FCF to debit its current account for the amounts necessary to
build up a Statistical Dilution Reserve equal to 20% of the total outstanding of
the amount of the Eligible Receivables transferred, by deducting 20% of the
amount of each remittance form (bordereau de remise). The Statistical Dilution
Reserve is intended to cover the amount of the dilutions (as defined in the
article 4-4 above), and the bad debts (defined as corresponding to situations of
declared insolvency, characterized by the opening of a procedure against a
debtor mentioned in Book VI of the Commercial Code).

The retained amounts within the Statistical Dilution Reserve are blocked as cash
collateral and are held by FCF in whole ownership and as a security. FCF will
keep the amounts recorded at the credit of the Statistical Dilution Reserve in
freehold and will therefore be able to set off its repayment obligation of these
amounts automatically and up to the level of the balance potentially in debit in
the Current Account at any time, and upon its definitive closure. All exceeding
amount, if existing, is returned to the Client.

In case of foreclosure of the account by a Client’ creditor in FCF’s hands, FCF
will be debtor of a conditional receivable of restitution of the amounts which
have been transferred in freehold and will therefore be in a position to use the
sums available on the Client’s Current Account in order to repay its own
receivables.

It can be created as many sub accounts as necessary which will form an integral
part of the Statistical Dilution Reserve.

Twice a month, FCF will take from the Statistical Dilution Reserve the amount of
the dilutions and the bad debts noticed over the period.

In case the accumulated amount of dilutions and bad debts is higher than 8% of
the transferred turnover, the rate of the Statistical Dilution Reserve applied
to the future transfers can be increased by the difference between the
ascertained percentage and 8%.

Payments with subrogation transferred to the Client remain acquired for the
fraction of the bad debts exceeding the amount of the outstanding Statistical
Dilution reserve; if the amount of unpaid receivables because of declared
insolvency at a date is in excess of the RS amount, the resulting loss will
remain borne by FCF.

In order to override the financial charge, the Statistical Dilution Reserve is
not a part of the calculation of the Financing Fee mentioned in article 8.

The way of proceeding of the Statistical Dilution Reserve is detailed in Annex
7.

 

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Article 7 Authorization of transfer without recourse of the property of the
receivables / Price of Acquisition

 

The maximum amount of financing the Client can use is €60,000,000 (sixty
million).

The Client can send at all time a drawdown request to FCF for a determined
amount of up to the maximum of €60,000,000, the payment of which shall be
imperatively done by bank transfer in the invoicing currency during the
afternoon of the day of the request if the request has been sent prior to 10h
and on the following day for every request sent after 10h.

In the case where the Current Account available is greater than the outstanding,
FCF will transfer the entire excess on a bank account, details of which will
have been given by the Client, as soon as such excess be greater than € 50,000.

The available counterpart of a transfer form results from:

> the amount, including VAT, of the Eligible Receivables mentioned in the
remittance form, plus the return of the available Statistical Dilution Reserve,

> after deduction of the following amounts:

 

  •  

Non guaranteed transferred receivables;

 

  •  

Disputes as defined at article 4.4;

 

  •  

Receivables leading the financing on the same debtor exceeding 6 % of the total
outstanding eligible receivables for the debtors EDF, CARREFOUR SA and banking
institutions, and, over 2 % for any other debtor;

 

  •  

Commissions due to FCF, VAT included;

 

  •  

Rebates on the turnover or advertising participations due by the Client to the
debtors (it is specified that the amounts that are not claimed or deducted by
the debtors twelve months after they are payables are not deductible);

 

  •  

Constitution of the Statistical Dilution Reserve.

Transferred Ineligible receivables will be transferred back by FCF to the Client
by counterbalance (contrepassation) upon each transfer date.

Article 8: FCF’s fees

 

8-1 Factoring fee

The factoring fee rate, excl. VAT, is fixed at 0.22% of the amount incl. VAT of
the transferred Eligible Receivables, for all transferred receivables. The
minimum annual fees comprising the factoring fee and the back-up fee defined in
article 4 of Schedule No. 2, is fixed at € 250.000 (two hundred and fifty
thousand euros) excl. VAT. Every semester ,FCF shall compare the fee effectively
paid on the grounds of the two fees and the corresponding part of the minimum
annual fee, and shall proceed, if applicable, to the relevant regularization so
that the collected fee be equivalent to the minimum.

8-2 Financing fee

The financing shall result in a post accounted financing fee, subject to VAT and
calculated ad valorem prorata temporis at the rate of 1-month Euribor + a margin
of 2.20%, excluding VAT per annum. The benchmark rate for a given month shall be
the rate of the last working day of the previous month.

The financing fee, calculated day by day on the balance of the current account,
is applied to any remaining due amount by the Client while the current account
is not discharged, it being specified that any payment received from a debtor
will decrease the financing fee base as soon as it is inscribed on the account.

For example, in order to meet the law, article L.313-4 of the Monetary and
Financial Code, the global effective rate applicable on the 01/09/09 would be
2.72% a year, for a financed amount of € 60,000,000 (maximum amount available
after application of the formula stated in article 7 paragraph 4).

The above rate, which includes a liquidity premium directly linked to the
current financial situation and the costs of refinancing of FCF, shall decrease
as of January 1st 2010 according to the evolution of the market conditions,
without being able to be lower than 1.80 % VAT excluded per annum.

 

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8-2 Audit fees

The Client will contribute to the quarterly audit costs up to € 3 000 excluding
VAT per audit.

Article 9: Notice

 

FCF shall give notice to the Client of transactions involving the transferred
receivables by sending it the corresponding statements and a monthly summary
itemizing the transactions that took place during the previous month.

The Client shall have the use of the electronic data system of FCF.

The Client shall give notice to FCF at once of any event or any plan likely to
seriously impact its operations, assets, shareholding structure or any change of
its Chairman or its Managing Director. The Client shall provide FCF with a
certified balance sheet including the notes thereto and its profit and loss
account upon their establishment but no later than the first week of July, it
being specified that this documents shall be communicated as drafts if they have
not been submitted to the annual general assembly in this timeframe. A copy of
the reports certified by the statutory auditors, shall also be communicated upon
their availability.

Article 10 : Miscellaneous

 

The charges and the banking fees (in accordance with the relevant rates), the
specific post charges (in accordance with the relevant rates) as well as the
fiscal taxes and charges applicable to the operations now or eventually, remain
at the Client’s charge.

Article 11: Term and termination of the Agreement / Jurisdiction and Governing
law

 

The Agreement is entered into for an unspecified term. Either party may
terminate the agreement at any time by means of a letter sent by recorded
delivery with advice of delivery (lettre recommandée avec accusé de réception),
subject to three months’ notice.

FCF may terminate the Agreement with a 15 day notice period sent by registered
letter with acknowledgment of receipt requested in case of change of control of
the Client or Office Depot Group, any substantial change in the Client’s legal
situation of the conditions of operation of its business (nature, typology of
the debtors,…) the substantial deterioration of the financial situation of the
Client or the Office Depot Group.

FCF may terminate the Agreement without notice in case of any serious failure by
the Client to fulfill its contractual obligations, including any actions by the
Client that may prevent FCF’s rights from being exercised.

The Client may terminate the Agreement without notice in case of any serious
failure by FCF to fulfill its contractual obligations, including any actions by
FCF that may prevent the Client’s rights from being exercised.

The termination of the Agreement, and after balancing of the operations will
automatically lead to the termination of any collateral granted in the framework
of the aforementioned Agreement and FCF undertakes to grant any release with
effect at the date of the balancing of the operations.

Any dispute relating to this Agreement shall be referred to the Paris Commercial
Court (Tribunal de Commerce).

Article 12: Effective date

 

The Agreement will be effective as of the notification by the Client of its
intent to use the financing.

 

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Article 13 : Confidentiality

 

Each Party undertakes that for the duration of the Agreement and as from its end
or termination to:

(i) maintain confidential the clauses of the present Agreement at any time and
procure that its employees, agents, representatives and external advisors do
same (by exception, the financing partners of the Client will be informed by FCF
of the existence of the present agreement);

(ii) refrain from using or disclosing any information of a financing, technical
or commercial nature that it could obtain in regard of the business, the
company, the goods, the services, the clients and the suppliers of the other
Party, with the exception of the information that:

- would be publicly available without it being a result of a breach of the
recipient Party; or

- would be made publicly available by an order, a directive or a decision from a
court or another competent authority;

- were in possession by the recipient Party before its disclosure;

- would be supplied to such Party by a third party who did not acquire such
information under a confidentiality undertaking.

Executed in Puteaux, in two originals, on

 

OFFICE DEPOT BS SAS *

   FORTIS COMMERCIAL FINANCE SAS *

* Company stamp and signature of an authorized person

 

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