Document:

Exhibit 10.6

 

COMMERCIAL
PAPER DEALER AGREEMENT

 

(4(2) PROGRAM;
GUARANTEED)

 

among

 

STAPLES,
INC. as Issuer

 

STAPLES THE OFFICE SUPERSTORE, LLC as Guarantor

 

STAPLES THE OFFICE SUPERSTORE EAST, INC. as
Guarantor

 

STAPLES CONTRACT & COMMERCIAL, INC. as
Guarantor

 

STAPLES THE OFFICE SUPERSTORE, LIMITED PARTNERSHIP
as Guarantor

 

and

 

J.P.
MORGAN SECURITIES INC., as Dealer

 

Concerning Notes to be issued pursuant to an
Issuing and Paying Agency Agreement dated as of June 9, 2008 and amended
as of August 6, 2008 between the Issuer and LaSalle Bank, as Issuing and
Paying Agent

 

Dated as
of

September 19,
2008

 

 

This
Commercial Paper Agreement (4(2) Program Guaranteed) (as amended, supplemented
or otherwise modified and in effect from time to time, the “Agreement”) sets
forth the understandings among the Issuer, the Guarantors and the Dealer, each
named on the cover page hereof, in connection with the issuance and sale by the
Issuer of its short-term promissory notes (the “Notes”) through the Dealer.

 

Pursuant to a guarantee, dated the date
hereof, in the form of Exhibit D hereto (the “Guarantee”) each Guarantor
has agreed jointly and severally to guarantee, subject to the terms of the
Guarantee, payment in full of the principal of and interest (if any) on all
such Notes.

 

Certain
terms used in this Agreement are defined in Section 6 hereof.

 

The
Addendum to this Agreement, and any Annexes or Exhibits described in this
Agreement or such Addendum, are hereby incorporated into this Agreement and
made fully a part hereof.

 

1.              Offers, Sales and Resales of Notes.

 

1.1.                  While (i) the Issuer has and shall have no
obligation to sell the Notes to the Dealer or to permit the Dealer to arrange
any sale of the Notes for the account of the Issuer, and (ii) the Dealer
has and shall have no obligation to purchase the Notes from the Issuer or to
arrange any sale of the Notes for the account of the Issuer, the parties hereto
agree that in any case where the Dealer purchases Notes from the Issuer, or
arranges for the sale of Notes by the Issuer, such Notes will be purchased or
sold by the Dealer in reliance on the representations, warranties, covenants
and agreements of the Issuer and, unless such Guarantor shall have been
released from the Guarantee in accordance with its terms, each Guarantor
contained herein or made pursuant hereto and on the terms and conditions and in
the manner provided herein.

 

1.2.                  So long as this Agreement shall remain in effect, and
in addition to the limitations contained in Section 1.7 hereof, neither
the Issuer nor, unless such Guarantor shall have been released from the
Guarantee in accordance with its terms, any Guarantor shall, without the
consent of the Dealer, offer, solicit or accept offers to purchase, or sell,
any Notes except (a) in transactions with one or more dealers which may
from time to time after the date hereof become dealers with respect to the
Notes by executing with the Issuer and the Guarantors one or more agreements
which contain provisions substantially identical to those contained in Section 1
of this Agreement, of which the Issuer and the Guarantors hereby undertakes to
provide the Dealer prompt notice or (b) in transactions with the other
dealers listed on the Addendum hereto, which are executing agreements with the
Issuer and the Guarantors which contain provisions substantially identical to Section 1
of this Agreement contemporaneously herewith. 
In no event shall the Issuer or any Guarantor offer, solicit or accept
offers to purchase, or sell, any Notes directly on its own behalf in transactions
with persons other than broker-dealers as specifically permitted in this Section 1.2.

 

1.3.                  The Notes shall be in a minimum denomination of
$250,000 or integral multiples of $1,000 in excess thereof, will bear such
interest rates, if interest bearing, or will be sold at such discount from
their face amounts, as shall be agreed upon by the Dealer and the Issuer, shall
have a maturity not exceeding 397 days from the date of issuance and may have
such terms as are specified in Exhibit C hereto or the Private Placement 

 

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Memorandum.   The Notes shall
not contain any provision for extension, renewal or automatic “rollover.”

 

1.4.                  The authentication and issuance of, and payment for, the Notes shall be
effected in accordance with the Issuing and Paying Agency Agreement, and the
Notes shall be either individual physical certificates or book-entry notes
evidenced by one or more master notes (each, a “Master Note”) registered in the
name of The Depository Trust Company (“DTC”) or its nominee, in the form or
forms annexed to the Issuing and Paying Agency Agreement.

 

1.5.                  If the Issuer and the Dealer shall agree on the terms
of the purchase of any Note by the Dealer or the sale of any Note arranged by
the Dealer (including, but not limited to, agreement with respect to the date
of issue, purchase price, principal amount, maturity and interest rate or
interest rate index and margin (in the case of interest-bearing Notes) or
discount thereof (in the case of Notes issued on a discount basis), and
appropriate compensation for the Dealer’s services hereunder) pursuant to this
Agreement, the Issuer shall cause such Note to be issued and delivered in
accordance with the terms of the Issuing and Paying Agency Agreement and
payment for such Note shall be made by the purchaser thereof, either directly
or through the Dealer, to the Issuing and Paying Agent, for the account of the
Issuer.  Except as otherwise agreed, in
the event that the Dealer is acting as an agent and a purchaser shall either
fail to accept delivery of or make payment for a Note on the date fixed for
settlement, the Dealer shall promptly notify the Issuer, and if the Dealer has
theretofore paid the Issuer for the Note, the Issuer will promptly return such
funds to the Dealer against its return of the Note to the Issuer, in the case
of a certificated Note, and upon notice of such failure in the case of a
book-entry Note.  If such failure
occurred for any reason other than default by the Dealer, the Issuer and,
unless such Guarantor shall have been released from the Guarantee in accordance
with its terms, each Guarantor agree, jointly and severally, to reimburse the
Dealer on an equitable basis for the Dealer’s loss of the use of such funds for
the period such funds were credited to the Issuer’s account.

 

1.6.                  All offers and sales of the Notes by the Issuer shall
be effected pursuant to the exemption from the registration requirements of the
Securities Act provided by Section 4(2) thereof, which exempts transactions
by an issuer not involving any public offering. 
The Dealer, the Issuer and each Guarantor hereby establish and agree to
observe the following procedures in connection with offers, sales and
subsequent resales or other transfers of the Notes:

 

(a)        Offers and sales of the Notes by or through the
Dealer shall be made only to: (i) investors reasonably believed by the
Dealer to be Qualified Institutional Buyers, Institutional Accredited Investors
or Sophisticated Individual Accredited Investors and (ii) non-bank
fiduciaries or agents that will be purchasing Notes for one or more accounts,
each of which is reasonably believed by the Dealer to be an Institutional
Accredited Investor or Sophisticated Individual Accredited Investor.

 

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(b)         Resales and other transfers of the Notes by the
holders thereof shall be made only in accordance with the restrictions in the
legend described in clause (e) below.

 

(c)          No general solicitation or general advertising shall
be used in connection with the offering of the Notes.  Without limiting the generality of the
foregoing, without the prior written approval of the Dealer, neither the Issuer
nor any Guarantor shall issue any press release or place or publish any “tombstone”
or other advertisement relating to the Notes.

 

(d)         No sale of Notes to any one purchaser shall be for
less than $250,000 principal or face amount, and no Note shall be issued in a
smaller principal or face amount.  If the
purchaser is a non-bank fiduciary acting on behalf of others, each person for
whom such purchaser is acting must purchase at least $250,000 principal or face
amount of Notes.

 

(e)          Offers and sales of the Notes by the Issuer through
the Dealer acting as agent for the Issuer shall be made in accordance with Rule 506
under the Securities Act, and shall be subject to the restrictions described in
the legend appearing on Exhibit A hereto. 
A legend substantially to the effect of such Exhibit A shall appear
as part of the Private Placement Memorandum used in connection with offers and
sales of Notes hereunder, as well as on each individual certificate
representing a Note and each Master Note representing book-entry Notes offered
and sold pursuant to this Agreement.

 

(f)            The Dealer shall furnish or shall have furnished to
each purchaser of Notes for which it has acted as the Dealer a copy of the
then-current Private Placement Memorandum unless such purchaser has previously
received a copy of the Private Placement Memorandum as then in effect.  The Private Placement Memorandum shall
expressly state that any person to whom Notes are offered shall have an
opportunity to ask questions of, and receive information from the Issuer, each
Guarantor, unless such Guarantor shall have been released from the Guarantee in
accordance with its terms, and the Dealer and shall provide the names,
addresses and telephone numbers of the persons from whom information regarding
the Issuer and the Guarantors may be obtained.

 

(g)         The Issuer and, unless such Guarantor shall have
been released from the Guarantee in accordance with its terms, each Guarantor,
jointly and severally, agree for the benefit of the Dealer and each of the
holders and prospective purchasers from time to time of the Notes that, if at
any time the Issuer shall not be subject to Section 13 or 15(d) of the
Exchange Act, the Issuer and, unless such Guarantor shall have been released
from the Guarantee in accordance with its terms, each Guarantor will furnish,
upon request and at their expense, to the Dealer and to holders and prospective
purchasers of Notes information required by Rule 144A(d)(4)(i) in
compliance with Rule 144A(d).

 

(h)         In the event that any Note offered or to be offered
by the Dealer would be ineligible for resale under Rule 144A, the Issuer
shall immediately notify the Dealer (by telephone, confirmed in writing) of
such fact and shall promptly prepare and deliver to the Dealer an amendment or
supplement to the Private 

 

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Placement Memorandum describing the Notes that are ineligible, the
reason for such ineligibility and any other relevant information relating
thereto.

 

(i)             The Issuer and each Guarantor represent that neither
the Issuer nor any Guarantor is currently issuing commercial paper in the
United States market in reliance upon the exemption provided by Section 3(a)(3)
of the Securities Act.  The Issuer and
each Guarantor agree that, if the Issuer or the Guarantor shall issue
commercial paper after the date hereof in reliance upon such exemption (a) the
proceeds from the sale of the Notes will be segregated from the proceeds of the
sale of any such commercial paper by being placed in a separate account; (b) the
Issuer and such Guarantor will institute appropriate corporate procedures to
ensure that the offers and sales of notes issued by the Issuer or the
Guarantor, as the case may be, pursuant to the Section 3(a)(3) exemption
are not integrated with offerings and sales of Notes hereunder; and (c) the
Issuer and such Guarantor will comply with each of the requirements of Section 3(a)(3)
of the Securities Act in selling commercial paper or other short-term debt
securities other than the Notes in the United States.  The Dealer agrees with the Issuer and the
Guarantors not to offer or sell any Notes in a manner that might call into
question the availability of the private offering exemption contained in Section 4(2)
of the Securities Act and Rule 144A thereunder, it being agreed that the
foregoing procedures do not call into question the availability of such
exemption.

 

1.7.                  Each of the Issuer as to itself and each Guarantor as
to itself hereby represents and warrants to the Dealer, in connection with
offers, sales and resales of Notes, as follows:

 

(a)          Except as
permitted by Section 1.6(i) or pursuant to the Original Agreement, within
the preceding six months neither the Issuer nor the Guarantors nor any person
other than the Dealer or the other dealers referred to in Section 1.2
hereof acting on behalf of the Issuer or the Guarantors has offered or sold any
Notes, or any substantially similar security of the Issuer or the Guarantors
(including, without limitation, medium-term notes issued by the Issuer or the
Guarantor), to, or solicited offers to buy any such security from, any person
other than the Dealer or the other dealers referred to in Section 1.2
hereof.  Except as permitted by Section 1.6(i),
as long as the Notes are being offered for sale by the Dealer and the other
dealers referred to in Section 1.2 hereof as contemplated hereby and until
at least six months after the offer of Notes hereunder has been terminated,
neither the Issuer nor the Guarantor nor any person other than the Dealer or
the other dealers referred to in Section 1.2 hereof (except as
contemplated by Section 1.2 hereof) will offer the Notes or any
substantially similar security of the Issuer for sale to, or solicit offers to
buy any such security from, any person other than the Dealer or the other
dealers referred to in Section 1.2 hereof, it being understood that such
agreement is made with a view to bringing the offer and sale of the Notes
within the exemption provided by Section 4(2) of the Securities Act and Rule 506
thereunder and shall survive any termination of this Agreement.  Neither the Issuer nor the Guarantors has
taken or omitted to take, and will not take or omit to take, any action that
would cause the offering and sale of Notes hereunder to be integrated with any
other offering of securities, whether such offering is made by the Issuer or
the Guarantors or some other party or parties, under circumstances that would
cause the offering and sale of the Notes by the Issuer to fail to be exempt
under Section 4(2) of the Securities Act.

 

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(b)         The Issuer
represents and agrees that the proceeds of the sale of the Notes are not
currently contemplated to be used for the purpose of buying, carrying or
trading securities within the meaning of Regulation T and the interpretations
thereunder by the Board of Governors of the Federal Reserve System.  In the event that the Issuer determines to
use proceeds from the sale of the Notes for the purpose of buying, carrying or
trading securities, whether in connection with an acquisition of another
company or otherwise, the Issuer shall give the Dealer at least three business
days’ prior written notice to that effect. 
The Issuer shall also give the Dealer prompt notice of the actual date
that it commences to purchase securities with the proceeds of the Notes.  Thereafter, in the event that the Dealer
purchases Notes as principal and does not resell such Notes on the day of such
purchase, to the extent necessary to comply with Regulation T and the
interpretations thereunder, the Dealer will sell such Notes either (i) only
to offerees it reasonably believes to be Qualified Institutional Buyers or to
Qualified Institutional Buyers it reasonably believes are acting for other
Qualified Institutional Buyers, in each case in accordance with Rule 144A
or (ii) in a manner which would not cause a violation of Regulation T and
the interpretations thereunder.

 

2. Representations and
Warranties of the Issuer and the Guarantors.

 

Each of
the Issuer and each Guarantor represents and warrants as to itself that:

 

2.1                    The Issuer is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has all the requisite power and authority
to execute, deliver and perform its obligations under the Notes, this Agreement
and the Issuing and Paying Agency Agreement.

 

2.2                    Each Guarantor is a
corporation, limited liability company or limited partnership, as applicable,
duly organized and validly existing and in good standing under the laws of the
jurisdiction of its incorporation or formation and has all the requisite power
and authority to execute, deliver and perform its obligations under the
Guarantee, this Agreement and the Issuing and Paying Agency Agreement.

 

2.3                    This Agreement and the Issuing and Paying
Agency Agreement have been duly authorized, executed and delivered by the
Issuer and each Guarantor and constitute legal, valid and binding obligations
of the Issuer and each Guarantor enforceable against the Issuer and each
Guarantor in accordance with their terms, subject to applicable bankruptcy, insolvency
and similar laws affecting creditors’ rights generally, and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).

 

2.4                    The Notes have been duly authorized, and
when issued as provided in the Issuing and Paying Agency Agreement, will be
duly and validly issued and will constitute legal, valid and binding
obligations of the Issuer enforceable against the Issuer in accordance with
their terms, subject to applicable bankruptcy, insolvency and similar laws
affecting creditors’ rights generally, and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).

 

2.5                    The Guarantee has been duly authorized,
and when the Notes have been issued as provided in the Issuing and Paying
Agency Agreement, will be duly executed and delivered by each 

 

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Guarantor and constitute the legal, valid and binding
obligation of each Guarantor enforceable against each Guarantor in accordance
with its terms subject to applicable bankruptcy, insolvency or similar laws
affecting creditors’ rights generally, and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).

 

2.6                    Assuming compliance by the Dealer with
the procedures applicable to it set forth in Section 1 hereof, the offer
and sale of the Notes and the Guarantee in the manner contemplated hereby do
not require registration of the Notes or the Guarantee under the Securities
Act, pursuant to the exemption from registration contained in Section 4(2)
thereof, and no indenture in respect of the Notes or the Guarantee is required
to be qualified under the Trust Indenture Act of 1939, as amended.

 

2.7                    The Notes and the Guarantee will rank at
least pari passu with all other unsecured and unsubordinated indebtedness of
the Issuer and the Guarantors, respectively.

 

2.8                    Assuming compliance by the Dealer with
the procedures applicable to it set forth in Section 1 hereof, no consent
or action of, or filing or registration with, any governmental or public
regulatory body or authority, including the SEC, is required to authorize, or is
otherwise required in connection with the execution, delivery or performance
of, this Agreement, the Notes, the Guarantee or the Issuing and Paying Agency
Agreement, except as may be required by the securities or Blue Sky laws of the
various states in connection with the offer and sale of the Notes.

 

2.9                    Neither the execution and delivery of
this Agreement, the Guarantee and the Issuing and Paying Agency Agreement, nor
the issuance of the Notes in accordance with the Issuing and Paying Agency
Agreement, nor the fulfillment of or compliance with the terms and provisions
hereof or thereof by the Issuer or any Guarantor, will (i) result in the
creation or imposition of any mortgage, lien, charge or encumbrance of any
nature whatsoever upon any of the properties or assets of the Issuer or any
Guarantor, or (ii) violate or result in a breach or a default under any of
the terms of the charter documents or by-laws of the Issuer or any Guarantor,
any contract or instrument to which the Issuer or any Guarantor is a party or
by which it or its property is bound, or any law or regulation, or any order,
writ, injunction or decree of any court or government instrumentality, to which
the Issuer or any Guarantor is subject or by which it or its property is bound,
which breach or default might have a material adverse effect on the financial
condition or operations of the Issuer and its subsidiaries taken as a whole or
the ability of the Issuer or any Guarantor to perform its obligations under
this Agreement, the Notes, the Guarantee or the Issuing and Paying Agency
Agreement.

 

2.10              Except as disclosed in the Company
Information, there is no litigation or governmental proceeding pending, or to
the knowledge of the Issuer or any Guarantor threatened, against or affecting
the Issuer or any Guarantor or any of its subsidiaries which might reasonably
be expected to result in a material adverse change in the financial condition
or operations of the Issuer and its subsidiaries taken as a whole or the
ability of the Issuer or any Guarantor to perform its obligations under this
Agreement, the Notes, the Guarantee or the Issuing and Paying Agency Agreement.

 

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2.11              Neither the Issuer nor any Guarantor is
an “investment company” within the meaning of the Investment Company Act of
1940, as amended.

 

2.12              Neither the Private Placement Memorandum
nor the Company Information contains any untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading.

 

2.13              Each (a) issuance of Notes by the
Issuer hereunder and (b) amendment or supplement of the Private Placement
Memorandum shall be deemed a representation and warranty by the Issuer and,
unless such Guarantor shall have been released from the Guarantee in accordance
with its terms, each Guarantor to the Dealer, as of the date thereof, that,
both before and after giving effect to such issuance and after giving effect to
such amendment or supplement, (i) the representations and warranties given
by the Issuer and the Guarantor set forth in this Section 2 remain true
and correct in all material respects on and as of such date as if made on and
as of such date, (ii) in the case of an issuance of Notes, the Notes being
issued on such date have been duly and validly issued and constitute legal,
valid and binding obligations of the Issuer, enforceable against the Issuer in
accordance with their terms, subject to applicable bankruptcy, insolvency and
similar laws affecting creditors’ rights generally and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law) and, unless the
Guarantors shall have been released from the Guarantee in accordance with its
terms, are guaranteed pursuant to the Guarantee, (iii) in the case of an
issuance of Notes, since the date of the most recent Private Placement
Memorandum, there has been no material adverse change in the financial
condition or operations of the Issuer and its subsidiaries taken as a whole
which has not been disclosed to the Dealer in writing and (iv) neither the
Issuer nor any Guarantor is in default of any of its obligations hereunder or
under the Notes, the Guarantee or the Issuing and Paying Agency Agreement.

 

3. Covenants and Agreements of the Issuer and the Guarantors.

 

Each
of the Issuer and each of the Guarantors, until and unless such Guarantor shall
have been released from the Guarantee in accordance with its terms, covenants
and agrees as to itself that:

 

3.1                     It will give the Dealer prompt notice
(but in any event prior to any subsequent issuance of Notes hereunder) of any
amendment to, modification of or waiver with respect to, the Notes, the
Guarantee or the Issuing and Paying Agency Agreement, including a complete copy
of any such amendment, modification or waiver.

 

3.2                     If any change shall occur in the
financial condition or operations of the Issuer and its subsidiaries taken as a
whole or any development or occurrence in relation to the Issuer or the
Guarantors that would have a material adverse effect on holders of the Notes or
potential holders of the Notes (including any downgrading of, receipt of any
notice of intended downgrading of or receipt of any written notice of a
potential change in, the rating accorded any of the securities of the Issuer or
the Guarantors by any nationally recognized statistical rating organization
which has published a rating of the Notes), promptly, and in any event prior to
any subsequent issuance of Notes hereunder, notify the Dealer (by telephone,
confirmed in writing) of such change, development or occurrence.

 

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3.3                    It shall from time to time furnish to the
Dealer such information as the Dealer may reasonably request, including,
without limitation, any press releases or material provided by the Issuer or
the Guarantors to any national securities exchange or rating agency, regarding (i) the
operations and financial condition of the Issuer or the Guarantors, (ii) the
due authorization and execution of the Notes and the Guarantee, (iii) the
Issuer’s ability to pay the Notes as they mature and (iv) any Guarantor’s
ability to fulfill its obligations under the Guarantee.

 

3.4                    It will take all such action as the
Dealer may reasonably request to ensure that each offer and each sale of the
Notes will comply with any applicable state Blue Sky laws; provided, however,
that neither the Issuer nor any Guarantor shall be obligated to file any
general consent to service of process or to qualify as a foreign corporation in
any jurisdiction in which it is not so qualified or subject itself to taxation
in respect of doing business in any jurisdiction in which it is not otherwise
so subject.

 

3.5                    It will not be in default of any of its
obligations hereunder or under the Notes, the Guarantee or the Issuing and
Paying Agency Agreement, at any time that any of the Notes are outstanding.

 

3.6                    The Issuer shall not issue Notes
hereunder until the Dealer shall have received (a) opinions of counsel to
the Issuer and the Guarantors, addressed to the Dealer, satisfactory in form
and substance to the Dealer, (b) a copy of the executed Issuing and Paying
Agency Agreement as then in effect, (c) a copy of the executed Guarantee, (d) a
copy of the resolutions adopted by the Boards of Directors of the Issuer and
each of the Guarantors, satisfactory in form and substance to the Dealer and
certified by the Secretary or similar officer of the Issuer or the Guarantor,
as the case may be, authorizing execution and delivery by the Issuer and the
Guarantors of this Agreement, the Issuing and Paying Agency Agreement, the
Guarantee and the Notes and consummation by the Issuer and the Guarantors of
the transactions contemplated hereby and thereby, (e) prior to the
issuance of any book-entry Notes represented by a master note registered in the
name of DTC or its nominee, a copy of the executed Letter of Representations
among the Issuer, the Guarantors, the Issuing and Paying Agent and DTC and of
the executed master note, (f) prior to the issuance of any Notes in
physical form, a copy of such form (unless attached to this Agreement or the
Issuing and Paying Agency Agreement), (g) confirmation of the then current
rating assigned to the Notes by each nationally recognized statistical rating
organization then rating the Notes, and (h) such other certificates,
opinions, letters and documents as the Dealer shall have reasonably requested.

 

3.7                    The Issuer and each Guarantor, jointly
and severally, agree to reimburse the Dealer for all of the Dealer’s
out-of-pocket expenses related to this Agreement, including expenses incurred
in connection with its preparation and negotiation, and the transactions
contemplated hereby (including, but not limited to, the printing and
distribution of the Private Placement Memorandum), and, if applicable, for the
reasonable fees and out-of-pocket expenses of the Dealer’s counsel.

 

4. Disclosure.

 

4.1                    The Private Placement Memorandum and its
contents (other than the Dealer Information) shall be the sole responsibility
of the Issuer and, unless such Guarantor shall have been released from the
Guarantee in accordance with its terms, the Guarantors.  The Private Placement Memorandum shall
contain a statement expressly offering an opportunity for each prospective
purchaser to ask questions of, and receive answers from, the Issuer and, unless
such Guarantor 

 

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shall
have been released from the Guarantee in accordance with its terms, any
Guarantor concerning the offering of Notes and to obtain relevant additional
information which the Issuer possesses or can acquire without unreasonable
effort or expense.

 

4.2                    Each of the Issuer and, unless such Guarantor shall
have been released from the Guarantee in accordance with its terms, each
Guarantor agrees to promptly furnish the Dealer the Company Information as it
becomes available.

 

4.3                     (a) Each of the Issuer and, unless such Guarantor
shall have been released from the Guarantee in accordance with its terms, each
Guarantor further agrees to notify the Dealer promptly upon (x) the
occurrence of any event relating to or affecting the Issuer or such Guarantor
that would cause the Company Information then in existence to include an untrue
statement of a material fact or to omit to state a material fact necessary in
order to make the statements contained therein, in light of the circumstances
under which they are made, not misleading or (y) the release of any
Guarantor from the Guarantee in accordance with its terms.  Notwithstanding the foregoing, neither the
Issuer nor any Guarantor shall have any obligation to so notify the Dealer if (i) the
Issuer has temporarily suspended offers and sales of the Notes and has given
the Dealer written notice of such suspension, or (ii) there are no Notes
outstanding.  In the event that the Issuer
wishes to resume
offers and sales of the Notes, it shall (i) give the Dealer notice thereof, and (ii) either
(x) confirm that the then current Private Placement Memorandum and Company
Information do not violate the representation contained in Section 2.13 of
this Agreement, or (y) if the representation contained in Section 2.13
cannot be made, provide to the Dealer an updated Private Placement Memorandum
that will permit the representation to be made. 
The Dealer agrees that, upon such notification, all solicitations and
sales of Notes shall be suspended.

 

(b)         In the event
that the Issuer gives the Dealer notice pursuant to Section 4.3(a) and the
Dealer notifies the Issuer that it then has Notes it is holding in inventory,
the Issuer agrees promptly to supplement or amend the Private Placement
Memorandum so that the Private Placement Memorandum, as amended or supplemented,
shall not contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, and the Issuer
shall make such supplement or amendment available to the Dealer or (ii) if the Issuer chooses not
to promptly amend or supplement the Private Placement Memorandum, the Issuer
shall, if required by the Dealer, purchase from the Dealer any such Notes held
in inventory at a price equal to the face amount thereof discounted on a
ratable basis based on the Issuer’s market rate reflecting the remaining period
until maturity in relation to the original term, provided that no commissions
or fees will be paid to such Dealer in connection with any such repurchase
pursuant to this Section 4.3(b)(ii).

 

(c)          In the event
that (i) the Issuer or any Guarantor gives the Dealer notice pursuant to Section 4.3(a),
(ii) the Dealer does not notify the Issuer or the Guarantors that it is
then holding Notes in inventory and (iii) the Issuer chooses not to
promptly amend or supplement the Private Placement Memorandum in the manner
described in clause (b) above, then all solicitations and sales of Notes
shall be suspended until such time as the Issuer has so amended or supplemented
the Private Placement Memorandum, and made such amendment or supplement
available to the Dealer.

 

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(d)         Without
limiting the generality of Section 4.3(a), the Issuer shall review, amend
and supplement the Private Placement Memorandum on a periodic basis, but no
less than at least once annually, to incorporate current
financial information regarding the Issuer  and the
Guarantors to the extent necessary to ensure that the information provided in
the Private Placement Memorandum is accurate and complete, it being
acknowledged that the condensed consolidating financial information regarding
the Guarantors contained in the Notes to the Issuer’s consolidated financial
statements shall be deemed current financial information regarding the
Guarantors.

 

5. Indemnification and Contribution.

 

5.1                    The Issuer and, unless such Guarantor
shall have been released from the Guarantee in accordance with its terms, each
Guarantor, jointly and severally, will indemnify and hold harmless the Dealer,
each individual, corporation, partnership, trust, association or other entity
controlling the Dealer, any affiliate of the Dealer or any such controlling
entity and their respective directors, officers, employees, partners,
incorporators, shareholders, servants, trustees and agents (hereinafter the “Indemnitees”)
against any and all liabilities, penalties, suits, causes of action, losses,
damages, claims, costs and expenses (including, without limitation, fees and
disbursements of counsel) or judgments of whatever kind or nature (each a “Claim”),
imposed upon, incurred by or asserted against the Indemnitees arising out of or
based upon (i) any allegation that the Private Placement Memorandum, the
Company Information or any information provided by the Issuer or the Guarantors
to the Dealer included (as of any relevant time) or includes an untrue
statement of a material fact or omitted (as of any relevant time) or omits to
state any material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading or (ii) arising
out of or based upon the breach by the Issuer or the Guarantors of any
agreement, covenant or representation made in or pursuant to this
Agreement.  This indemnification shall
not apply to the extent that the Claim arises out of or is based upon Dealer
Information or that the Claim is determined by a court of
competent jurisdiction to have resulted from an Indemnitee’s gross negligence
or willful misconduct.

 

5.2                     Provisions relating to
claims made for indemnification under this Section 5 are set forth on Exhibit B to this
Agreement.

 

5.3                     In order
to provide for just and equitable contribution in circumstances in which the
indemnification provided for in this Section 5 is held to be unavailable
or insufficient to hold harmless the Indemnitees, although applicable in accordance with
the terms of this Section 5, the Issuer and, unless such Guarantor shall
have been released from the Guarantee in accordance with its terms, each
Guarantor, jointly and severally, shall contribute to the aggregate costs
incurred by the Dealer in connection with any Claim in the proportion of the
respective economic interests of the Issuer, the Guarantors and the Dealer;
provided, however, that such contribution by the Issuer and the Guarantors
shall be in an amount such that the aggregate costs incurred by the Dealer do
not exceed the aggregate of the commissions and fees earned by the Dealer
hereunder with respect to the issue or issues of Notes to which such Claim
relates.  The respective economic
interests shall be calculated by reference to the aggregate proceeds to the
Issuer of the Notes issued hereunder and the aggregate commissions and fees
earned by the Dealer hereunder.

 

11

 

6. Definitions.

 

6.1                    “Claim” shall have the meaning set forth in Section 5.1.

 

6.2                    “Company Information” at any given time shall mean the
Private Placement Memorandum (other than the Dealer Information) together with,
to the extent applicable, (i) the Issuer’s most recent report on Form 10-K
filed with the SEC and each report on Form 10-Q or 8-K filed by the Issuer
with the SEC since the most recent Form 10-K, (ii) the Issuer’s most
recent annual audited financial statements and each interim financial statement
or report prepared subsequent thereto, if not included in item (i) above, (iii) the
Issuer’s other publicly available recent reports, including, but not limited
to, any publicly available filings or reports provided to their respective
shareholders, (iv) any other information or disclosure prepared pursuant
to Section 4.3 hereof and (v) any information prepared or approved by
the Issuer or the Guarantors for dissemination to investors or potential
investors in the Notes.

 

6.3                    “Dealer Information” shall mean material concerning
the Dealer provided by the Dealer in writing expressly for inclusion in the
Private Placement Memorandum.

 

6.4                    “Exchange Act” shall mean the U.S. Securities Exchange
Act of 1934, as amended.

 

6.5                    “Indemnitee” shall have the meaning set forth in Section 5.1.

 

6.6                    “Institutional Accredited Investor” shall mean an
institutional investor that is an accredited investor within the meaning of Rule 501
under the Securities Act and that has such knowledge and experience in
financial and business matters that it is capable of evaluating and bearing the
economic risk of an investment in the Notes, including, but not limited to, a
bank, as defined in Section 3(a)(2) of the Securities Act, or a savings
and loan association or other institution, as defined in Section 3(a)(5)(A)
of the Securities Act, whether acting in its individual or fiduciary capacity.

 

6.7                    “Issuing and Paying Agency Agreement” shall mean the
issuing and paying agency agreement described on the cover page of this
Agreement, as such agreement may be amended or supplemented from time to time.

 

6.8                    “Issuing and Paying Agent” shall mean the party
designated as such on the cover page of this Agreement, as issuing and paying
agent under the Issuing and Paying Agency Agreement, or any successor thereto
in accordance with the Issuing and Paying Agency Agreement.

 

6.9                    “Non-bank fiduciary or agent” shall mean a fiduciary
or agent other than (a) a bank, as defined in Section 3(a)(2) of the
Securities Act, or (b) a savings and loan association, as defined in Section 3(a)(5)(A)
of the Securities Act.

 

6.10              “Private Placement Memorandum” shall mean offering
materials prepared in accordance with Section 4 (including materials
referred to therein or incorporated by reference therein, if any) provided to
purchasers and prospective purchasers of the Notes, and shall include
amendments and supplements thereto which may be prepared from time to time in
accordance with this Agreement (other than any amendment or supplement that has
been completely superseded by a later amendment or supplement).

 

6.11              “Qualified Institutional Buyer” shall have the meaning
assigned to that term in Rule 144A under the Securities Act.

 

12

 

6.12              “Rule 144A” shall mean Rule 144A under the
Securities Act.

 

6.13              “SEC” shall mean the U.S. Securities and Exchange
Commission.

 

6.14              “Securities Act” shall mean the U.S. Securities Act of
1933, as amended.

 

6.15              “Sophisticated Individual Accredited Investor” shall
mean an individual who (a) is an accredited investor within the meaning of
Regulation D under the Securities Act and (b) based on his or her
pre-existing relationship with the Dealer, is reasonably believed by the Dealer
to be a sophisticated investor (i) possessing such knowledge and
experience (or represented by a fiduciary or agent possessing such knowledge
and experience) in financial and business matters that he or she is capable of
evaluating and bearing the economic risk of an investment in the Notes and (ii) having
not less than $5 million in investments (as defined, for purposes of this
section, in Rule 2a51-1 under the Investment Company Act of 1940, as
amended).

 

7. General

 

7.1                    Unless otherwise expressly provided herein, all
notices under this Agreement to parties hereto shall be in writing and shall be
effective when received at the address of the respective party set forth in the
Addendum to this Agreement.

 

7.2                    This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to its
conflict of laws provisions.

 

7.3                    (a) Each of the Issuer and each Guarantor agrees
that any suit, action or proceeding brought by the Issuer or any Guarantor
against the Dealer in connection with or arising out of this Agreement or the
Notes or the offer and sale of the Notes shall be brought solely in the United
States federal courts located in the Borough of Manhattan or the courts of the
State of New York located in the Borough of Manhattan.  THE DEALER, THE ISSUER AND EACH GUARANTOR
WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(b) Each of the Issuer and each Guarantor hereby
irrevocably accepts and submits to the non-exclusive jurisdiction of each of
the aforesaid courts in personam, generally and unconditionally, for itself and
in respect of its properties, assets and revenues, with respect to any suit,
action or proceeding in connection with or arising out of this Agreement, the
Guarantee or the Notes or the offer and sale of the Notes.

 

7.4                    This Agreement may be terminated, at any time, by the
Issuer, upon one business day’s prior notice to such effect to the Dealer, or
by the Dealer upon one business day’s prior notice to such effect to the
Issuer.  Any such termination, however,
shall not affect the obligations of the Issuer and, subject to terms of the
Guarantee, the Guarantors under Sections 3.7, 4.3(a) and (b), 5 and 7.3 hereof
or the respective representations, warranties, agreements, covenants, rights or
responsibilities of the parties made or arising prior to the termination of
this Agreement.

 

7.5                    This Agreement is not assignable by any party hereto
without the written consent of the other parties; provided, however, that the
Dealer may assign its rights and obligations under this Agreement to any
affiliate of the Dealer.

 

13

 

7.6                    This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.

 

7.7                    This Agreement is for the exclusive benefit of the
parties hereto, and their respective permitted successors and assigns
hereunder, and shall not be deemed to give any legal or equitable right, remedy
or claim to any other person whatsoever.

 

7.8                    The Issuer and each Guarantor acknowledges
and agrees that in connection with this purchase and sale of the Notes or any
other services the Dealer may be deemed to be providing hereunder,
notwithstanding any preexisting relationship, advisory or otherwise, between
the parties or any oral representations or assurances previously or
subsequently made by the Dealer: (i) no fiduciary or agency relationship
between the Issuer, the Guarantors and any other person, on the one hand, and
the Dealer, on the other, exists; (ii) the Dealer is not acting as
advisor, expert or otherwise, to either the Issuer or any Guarantor, including,
without limitation, with respect to the determination of the offering price of
the Notes, and such relationship between the Issuer and the Guarantors, on the
one hand, and the Dealer, on the other, is entirely and solely commercial,
based on arms-length negotiations;
(iii) any duties and
obligations that the Dealer may have to the Issuer or the Guarantors shall be
limited to those duties and obligations specifically stated herein; and (iv) the
Dealer and their respective affiliates may have interests that differ from
those of the Issuer or the Guarantors. 
Each of the Issuer and each Guarantor hereby waives any claims that the
Issuer or such Guarantor may have against the Dealer with respect to any breach
of fiduciary duty in connection with the purchase and sale of the Notes.

 

14

 

IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be executed as of the date and year first above written.

 

	
  Staples, Inc.,
  as Issuer

  	
   

  	
  J.P.
  Morgan Securities Inc., as Dealer

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Ronald L. Sargent

  	
   

  	
  By:

  	
  Johanna
  C. Foley

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:
  Ronald L. Sargent

  	
   

  	
  Name:

  	
  Johanna
  C. Foley

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:
  Chairman and Chief Executive Officer

  	
   

  	
  Title:

  	
  Executive
  Director

  
	
   

  	
   

  	
   

  	
   

  
	
  Staples, Inc.,
  as Issuer

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  John J. Mahoney

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:
  John J. Mahoney

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:
  Vice Chairman and Chief Financial Officer

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Staples
  the Office Superstore, LLC, as Guarantor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Nicholas Hotchkin

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Staples
  the Office Superstore East, Inc., as Guarantor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Nicholas Hotchkin

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Staples
  Contract & Commercial, Inc., as Guarantor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Nicholas Hotchkin

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Staples
  the Office Superstore, Limited Partnership, as Guarantor

  	
   

  	
   

  
	
    By its General Partner,
  Staples, Inc.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Nicholas Hotchkin

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  

 

15

 

Addendum

 

The following additional clauses shall apply to the Agreement and be
deemed a part thereof.

 

The addresses of the respective parties for purposes
of notices under Section 7.1 are as follows:

 

For
the Issuer:

 

Address:
500 Staples Drive, Framingham, MA 01702

Attention:  MarciJo Lerner

Telephone
number:  (508) 253-7775

Fax
number:  (508) 253-5440

 

For
the Guarantor: Staples
the Office Superstore, LLC

 

Address:
500 Staples Drive, Framingham, MA 01702

Attention:
 MarciJo Lerner

Telephone
number:  (508) 253-7775

Fax
number:  (508) 253-5440

 

For
the Guarantor:
Staples the Office Superstore East, Inc.

 

Address:
500 Staples Drive, Framingham, MA 01702

Attention:  MarciJo Lerner

Telephone
number:  (508) 253-7775

Fax
number:  (508) 253-5440

 

For
the Guarantor:
Staples Contract & Commercial, Inc.

 

Address:
500 Staples Drive, Framingham, MA 01702

Attention:  MarciJo Lerner

Telephone
number:  (508) 253-7775

Fax
number:  (508) 253-5440

 

For
the Guarantor: Staples
the Office Superstore, Limited Partnership

 

Address:
500 Staples Drive, Framingham, MA 01702

Attention:  MarciJo Lerner

Telephone
number:  (508) 253-7775

Fax
number:  (508) 253-5440

 

For
the Dealer:

 

Address:  270 Park Avenue - 8th Floor, New York, NY
10017

Attention:  Short Term Fixed Income Division

Telephone
number:       (212) 834-5543

Fax
number:     (212) 834-6172

 

16

 

Exhibit A

 

Form of Legend for Private
Placement Memorandum and Notes

 

THE
NOTES AND THE GUARANTEE THEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY OTHER APPLICABLE SECURITIES LAW,
AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN
APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY
APPLICABLE STATE SECURITIES LAWS.  BY ITS
ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT (I) IT
HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE ISSUER,
THE GUARANTORS , THE NOTES AND THE GUARANTEE, (II) IT IS NOT ACQUIRING
SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF, (III) IT IS EITHER (A)(1)
AN INSTITUTIONAL INVESTOR OR SOPHISTICATED INDIVIDUAL INVESTOR THAT IS AN “ACCREDITED
INVESTOR” WITHIN THE MEANING OF RULE 501(a) UNDER THE ACT AND WHICH, IN THE
CASE OF AN INDIVIDUAL (i) POSSESSES SUCH KNOWLEDGE AND EXPERIENCE IN
FINANCIAL AND BUSINESS MATTERS THAT HE OR SHE IS CAPABLE OF EVALUATING AND
BEARING THE ECONOMIC RISK OF AN INVESTMENT IN THE NOTES AND (ii) HAS NOT
LESS THAN $5 MILLION IN INVESTMENTS (AN “INSTITUTIONAL ACCREDITED INVESTOR” OR “SOPHISTICATED
INDIVIDUAL ACCREDITED INVESTOR”, RESPECTIVELY) AND (2)(i) PURCHASING NOTES FOR
ITS OWN ACCOUNT, (ii) A BANK (AS DEFINED IN SECTION 3(a)(2) OF THE
ACT) OR A SAVINGS AND LOAN ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A)
OF THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR (iii) A
FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN ASSOCIATION)
PURCHASING NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH ACCOUNTS IS SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED
INVESTOR; OR (B) A QUALIFIED INSTITUTIONAL BUYER (“QIB”) WITHIN THE
MEANING OF RULE 144A UNDER THE ACT THAT IS ACQUIRING NOTES FOR ITS OWN ACCOUNT
OR FOR ONE OR MORE ACCOUNTS, EACH OF WHICH ACCOUNTS IS A QIB; AND THE PURCHASER
ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION FROM
THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE
144A.  BY ITS ACCEPTANCE OF A NOTE, THE
PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER
TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM
REGISTRATION UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO A PLACEMENT
AGENT DESIGNATED BY THE ISSUER AS A PLACEMENT AGENT FOR THE NOTES
(COLLECTIVELY, THE “PLACEMENT AGENTS”), NONE OF WHICH SHALL HAVE ANY OBLIGATION
TO ACQUIRE SUCH NOTE, (2) THROUGH A PLACEMENT AGENT TO AN INSTITUTIONAL
ACCREDITED INVESTOR, SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR OR A QIB, OR (3) TO
A QIB IN A TRANSACTION THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN
MINIMUM AMOUNTS OF $250,000.

 

17

 

Exhibit B

 

Further Provisions Relating to
Indemnification

 

(a)          The Issuer and, unless such Guarantor shall have been released from
the Guarantee in accordance with its terms, each Guarantor, jointly and
severally, agrees to reimburse each Indemnitee for all expenses (including
reasonable fees and disbursements of internal and external counsel) as they are
incurred by it in connection with investigating or defending any loss, claim,
damage, liability or action in respect of which indemnification may be sought
under Section 5 of the Agreement (whether or not it is a party to any such
proceedings).

 

(b)         Promptly after receipt by an Indemnitee of notice of
the existence of a Claim, such Indemnitee will, if a claim in respect thereof
is to be made against the Issuer or any Guarantor, notify the Issuer and the
Guarantor in writing of the existence thereof; provided that (i) the
omission to so notify the Issuer or any Guarantor will not relieve it from any
liability which it may have hereunder unless and except to the extent it did
not otherwise learn of such Claim and such failure results in the forfeiture by
it of substantial rights and defenses, and (ii) the omission to so notify
the Issuer or the Guarantors will not relieve it from liability which it may
have to an Indemnitee otherwise than on account of this indemnity
agreement.  In case any such Claim is made
against any Indemnitee and it notifies the Issuer or any Guarantor of the
existence thereof, the Issuer and the Guarantors will be entitled to
participate therein, and to the extent that it may elect by written notice
delivered to the Indemnitee, to assume the defense thereof, with counsel
reasonably satisfactory to such Indemnitee; provided that if the defendants in
any such Claim include both the Indemnitee and either the Issuer or the
Guarantors or both, and the Indemnitee shall have concluded that there may be
legal defenses available to it which are different from or additional to those
available to the Issuer or the Guarantors, the Issuer shall not have the right
to direct the defense of such Claim on behalf of such Indemnitee, and the
Indemnitee shall have the right to select separate counsel to assert such legal
defenses on behalf of such Indemnitee. 
Upon receipt of notice from the Issuer to such Indemnitee of the
election of the Issuer and the Guarantors to assume the defense of such Claim
and approval by the Indemnitee of counsel, the Issuer and the Guarantors will
not be liable to such Indemnitee for expenses incurred thereafter by the
Indemnitee in connection with the defense thereof (other than reasonable costs
of investigation) unless (i) the Indemnitee shall have employed separate
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the next preceding sentence (it being understood, however, that
neither the Issuer nor any Guarantor shall be liable for the expenses of more
than one separate counsel (in addition to any local counsel in the jurisdiction
in which any Claim is brought), approved by the Dealer, representing the
Indemnitee who is party to such Claim), (ii) the Issuer and the Guarantors
shall not have employed counsel reasonably satisfactory to the Indemnitee to
represent the Indemnitee within a reasonable time after notice of existence of
the Claim or (iii) the Issuer or the Guarantors has authorized in writing
the employment of counsel for the Indemnitee. 
The indemnity, reimbursement and contribution obligations of the Issuer
and the Guarantors hereunder shall be in addition to any other liability the
Issuer or the Guarantors may otherwise have to an Indemnitee and shall be
binding upon and inure to the benefit of any successors, assigns, heirs and
personal representatives of the Issuer, the Guarantors and any Indemnitee.  Each of the Issuer and each Guarantor agrees
that without the Dealer’s prior written consent, it will not settle, compromise
or consent to the entry of any judgment in any Claim in respect of which
indemnification may be sought under the indemnification provision of the
Agreement (whether or not the Dealer or any other Indemnitee is an actual or
potential party to such Claim), unless such settlement, 

 

18

 

compromise or consent (i) includes an unconditional release of
each Indemnitee from all liability arising out of such Claim and (ii) does
not include a statement as to or an admission of fault, culpability or failure
to act, by or on behalf of any Indemnitee.

 

19

 

Exhibit C

 

Statement of Terms for Interest –
Bearing Commercial Paper Notes of Staples, Inc.

 

THE PROVISIONS SET FORTH BELOW
ARE QUALIFIED TO THE EXTENT APPLICABLE BY THE TRANSACTION SPECIFIC PRIVATE
PLACEMENT MEMORANDUM SUPPLEMENT (THE “SUPPLEMENT”) (IF ANY) SENT TO EACH
PURCHASER AT THE TIME OF THE TRANSACTION.

 

1.  General.  (a)  The obligations of the Issuer to
which these terms apply (each a “Note”) are represented by one or more Master
Notes (each, a “Master Note”) issued in the name of (or of a nominee for) The
Depository Trust Company (“DTC”), which Master Note
includes the terms and provisions for the Issuer’s Interest-Bearing Commercial
Paper Notes that are set forth in this Statement of Terms, since this Statement
of Terms constitutes an integral part of the Underlying Records as defined and
referred to in the Master Note.

 

(b)  “Business Day” means any day other than a Saturday or
Sunday that is neither a legal holiday nor a day on which banking institutions
are authorized or required by law, executive order or regulation to be closed
in New York City and, with respect to LIBOR Notes (as defined
below) is also a London Business Day.  “London
Business Day” means a day, other than a Saturday or Sunday, on which dealings
in deposits in U.S. dollars are transacted in the London interbank market.

 

2.  Interest.  (a)  Each Note will bear interest at a
fixed rate (a “Fixed Rate Note”) or at a floating rate (a “Floating Rate Note”).

 

(b)  The Supplement sent to each holder of such Note will describe
the following terms: (i) whether such Note is a Fixed Rate Note or a
Floating Rate Note and whether such Note is an Original Issue Discount Note (as
defined below); (ii) the date on which such Note will be issued (the “Issue
Date”); (iii) the Stated Maturity Date (as defined below); (iv) if
such Note is a Fixed Rate Note, the rate per annum at which such Note
will bear interest, if any, and the Interest Payment Dates; (v) if such
Note is a Floating Rate Note, the Base Rate, the Index Maturity, the Interest
Reset Dates, the Interest Payment Dates and the Spread and/or Spread
Multiplier, if any (all as defined below), and any other terms relating to the
particular method of calculating the interest rate for such Note; and (vi) any
other terms applicable specifically to such Note.  “Original Issue Discount Note” means a Note
which has a stated redemption price at the Stated Maturity Date that exceeds
its Issue Price by more than a specified de
minimis amount and which the Supplement indicates will be an “Original Issue
Discount Note”.

 

(c)  Each Fixed Rate Note will bear interest from its Issue Date
at the rate per annum specified in the Supplement until the principal amount
thereof is paid or made available for payment. 
Interest on each Fixed Rate Note will be payable on the dates specified
in the Supplement (each an “Interest Payment Date” for a
Fixed Rate Note) and on the Maturity Date (as defined below).  Interest on Fixed Rate Notes will be computed
on the basis of a 360-day year of twelve 30-day months.

 

If any Interest Payment Date or the Maturity Date of a Fixed Rate Note
falls on a day that is not a Business Day, the required payment of principal,
premium, if any, and/or interest will be payable on the next succeeding
Business Day, and no additional interest will accrue in respect of the payment
made on that next succeeding Business Day.

 

20

 

(d)  The interest rate on each Floating Rate Note for each
Interest Reset Period (as defined below) will be determined by reference to an
interest rate basis (a “Base Rate”) plus or minus a number of basis points (one
basis point equals one-hundredth of a percentage point) (the “Spread”),
if any, and/or multiplied by a certain percentage (the “Spread Multiplier”), if
any, until the principal thereof is paid or made available for payment.  The Supplement will designate which of the
following Base Rates is applicable to the related Floating Rate Note: (a) the
CD Rate (a “CD Rate Note”), (b) the Commercial Paper Rate (a “Commercial
Paper Rate Note”), (c) the Federal Funds Rate (a “Federal Funds Rate Note”),
(d) LIBOR (a “LIBOR Note”), (e) the Prime Rate (a “Prime Rate Note”),
(f) the Treasury Rate (a “Treasury Rate Note”) or (g) such other Base
Rate as may be specified in such Supplement.

 

The rate of
interest on each Floating Rate Note will be reset daily, weekly, monthly,
quarterly or semi-annually (the “Interest Reset Period”).  The date or dates on which interest will be
reset (each an “Interest Reset Date”) will be, unless otherwise specified in
the Supplement, in the case of Floating Rate Notes which reset daily, each
Business Day, in the case of Floating Rate Notes (other than Treasury Rate
Notes) that reset weekly, the Wednesday of each week; in the case of Treasury
Rate Notes that reset weekly, the Tuesday of each week; in the case of Floating
Rate Notes that reset monthly, the third Wednesday of each month; in the case
of Floating Rate Notes that reset quarterly, the third Wednesday of March,
June, September and December; and in the case of Floating Rate Notes that reset
semiannually, the third Wednesday of the two months specified in the
Supplement.  If any Interest Reset Date
for any Floating Rate Note is not a Business Day, such Interest Reset Date will
be postponed to the next day that is a Business Day, except that in the case of
a LIBOR Note, if such Business Day is in the next succeeding calendar month,
such Interest Reset Date shall be the immediately preceding Business Day.
Interest on each Floating Rate Note will be payable monthly, quarterly or
semiannually (the “Interest Payment Period”) and on the Maturity Date.  Unless otherwise specified in the Supplement,
and except as provided below, the date or dates on which interest will be
payable (each an “Interest Payment Date” for a Floating Rate Note) will be, in
the case of Floating Rate Notes with a monthly Interest Payment Period, on the
third Wednesday of each month; in the case of Floating Rate Notes with
a quarterly Interest Payment Period, on the third Wednesday of March, June, September
and December; and in the case of Floating Rate Notes with a semiannual Interest
Payment Period, on the third Wednesday of the two months specified in the
Supplement.  In addition, the Maturity
Date will also be an Interest Payment Date.

 

If any Interest Payment Date for any Floating Rate Note (other than an
Interest Payment Date occurring on the Maturity Date) would otherwise be a day
that is not a Business Day, such Interest Payment Date shall be postponed to
the next day that is a Business Day, except that in the case of a LIBOR Note,
if such Business Day is in the next succeeding calendar month, such Interest
Payment Date shall be the immediately preceding Business Day.  If the Maturity Date of a Floating Rate Note
falls on a day that is not a Business Day, the payment of principal and
interest will be made on the next succeeding Business Day, and no interest on
such payment shall accrue for the period from and after such maturity.

 

Interest payments on each Interest Payment Date for Floating Rate Notes will include accrued
interest from and including the Issue Date or from and including the last date
in respect of which interest has been paid, as the case may be, to, but
excluding, such Interest Payment Date. 
On the Maturity Date, the interest payable on a Floating Rate Note will
include interest accrued to, but excluding, the Maturity Date.  Accrued interest will be calculated by
multiplying the principal amount of a Floating 

 

21

 

Rate Note by an
accrued interest factor.  This accrued
interest factor will be computed by adding the interest factors calculated for
each day in the period for which accrued interest is being calculated.  The interest factor (expressed as a decimal)
for each such day will be computed by dividing the interest rate applicable to
such day by 360, in the cases where the Base Rate is the CD Rate, Commercial
Paper Rate, Federal Funds Rate, LIBOR or Prime Rate, or by the actual number of
days in the year, in the case where the Base Rate is the Treasury Rate.  The interest rate in effect on each day will
be (i) if such day is an Interest Reset Date, the interest rate with
respect to the Interest Determination Date (as defined below) pertaining to
such Interest Reset Date, or (ii) if such day is not an Interest Reset
Date, the interest rate with respect to the Interest Determination Date
pertaining to the next preceding Interest Reset Date, subject in either case to
any adjustment by a Spread and/or a Spread Multiplier.

 

The “Interest
Determination Date” where the Base Rate is the CD Rate or the Commercial Paper
Rate will be the second Business Day next preceding an Interest Reset
Date.  The Interest Determination Date
where the Base Rate is the Federal Funds Rate or the Prime Rate will be the
Business Day next preceding an Interest Reset Date.  The Interest Determination Date where the
Base Rate is LIBOR will be the second London Business Day next preceding an
Interest Reset Date.  The Interest
Determination Date where the Base Rate is the Treasury Rate will be the day of
the week in which such Interest Reset Date falls when Treasury Bills are
normally auctioned.  Treasury Bills are
normally sold at auction on Monday of each week, unless that day is a legal
holiday, in which case the auction is held on the following Tuesday or the
preceding Friday.  If an auction is so
held on the preceding Friday, such Friday will be the Interest Determination
Date pertaining to the Interest Reset Date occurring in the next succeeding
week.

 

The “Index
Maturity” is the period to maturity of the instrument or obligation from which
the applicable Base Rate is calculated.

 

The “Calculation
Date,” where applicable, shall be the earlier of (i) the tenth calendar
day following the applicable Interest Determination Date or (ii) the
Business Day preceding the applicable Interest Payment Date or Maturity Date.

 

All times referred to herein reflect New York City time, unless
otherwise specified.

 

The Issuer shall
specify in writing to the Issuing and Paying Agent which party will be the
calculation agent (the “Calculation Agent”) with respect to the Floating Rate
Notes.  The Calculation Agent will
provide the interest rate then in effect and, if determined, the interest rate
which will become effective on the next Interest Reset Date with respect to
such Floating Rate Note to the Issuing and Paying Agent as soon as the interest
rate with respect to such Floating Rate Note has been determined and as soon as
practicable after any change in such interest rate.

 

All percentages
resulting from any calculation on Floating Rate Notes will be rounded to the
nearest one hundred-thousandth of a percentage point, with five-one millionths
of a percentage point rounded upwards. 
For example, 9.876545% (or .09876545) would be rounded to 9.87655% (or
..0987655).  All dollar amounts used in or
resulting from any calculation on Floating Rate Notes will be rounded, in the
case of U.S. dollars, to the nearest cent or, in the case of a foreign
currency, to the nearest unit (with one-half cent or unit being rounded
upwards).

 

22

 

CD Rate Notes

 

“CD Rate” means
the rate on any Interest Determination Date for negotiable certificates of
deposit having the Index Maturity as published by the Board of Governors of the
Federal Reserve System (the “FRB”) in “Statistical Release H.15(519), Selected
Interest Rates” or any successor publication of the FRB (“H.15(519)”) under the
heading “CDs (Secondary Market)”.

 

If the above rate
is not published in H.15(519) by 3:00 p.m. on the Calculation Date, the CD
Rate will be the rate on such Interest Determination Date set forth in the
daily update of H.15(519), available through the world wide website of the FRB
at http://www.federalreserve.gov/releases/h15/Update, or any successor site or
publication or other recognized electronic source used for the purpose of
displaying the applicable rate (“H.15 Daily Update”) under the caption “CDs
(Secondary Market)”.

 

If such rate is
not published in either H.15(519) or H.15 Daily Update by 3:00 p.m. on the
Calculation Date, the Calculation Agent will determine the CD Rate to be the
arithmetic mean of the secondary market offered rates as of 10:00 a.m. on
such Interest Determination Date of three leading nonbank dealers(1) in negotiable U.S. dollar certificates of deposit in
New York City selected by the Calculation Agent for negotiable U.S. dollar
certificates of deposit of major United States money center banks of the
highest credit standing in the market for negotiable certificates of deposit
with a remaining maturity closest to the Index Maturity in the denomination of
$5,000,000.

 

If the dealers
selected by the Calculation Agent are not quoting as set forth above, the CD
Rate will remain the CD Rate then in effect on such Interest Determination
Date.

 

Commercial Paper Rate Notes

 

“Commercial Paper
Rate” means the Money Market Yield (calculated as described below) of the rate
on any Interest Determination Date for commercial paper having the Index
Maturity, as published in H.15(519) under the heading “Commercial
Paper-Nonfinancial”.

 

If the above rate
is not published in H.15(519) by 3:00 p.m. on the Calculation Date, then
the Commercial Paper Rate will be the Money Market Yield of the rate on such
Interest Determination Date for commercial paper of the Index Maturity as
published in H.15 Daily Update under the heading “Commercial Paper-Nonfinancial”.

 

If by 3:00 p.m.
on such Calculation Date such rate is not published in either H.15(519) or H.15
Daily Update, then the Calculation Agent will determine the Commercial Paper
Rate to be the Money Market Yield of the arithmetic mean of the offered rates
as of 11:00 a.m. on such Interest Determination Date of three leading
dealers of U.S. dollar commercial paper in New York City selected by the
Calculation Agent for commercial paper of the Index Maturity placed for an
industrial issuer whose bond rating is “AA,” or the equivalent, from a
nationally recognized statistical rating organization.

 

If the dealers
selected by the Calculation Agent are not quoting as mentioned above, the
Commercial Paper Rate with respect to such Interest Determination Date will
remain the Commercial Paper Rate then in effect on such Interest Determination
Date.

 

“Money Market Yield” will be a yield calculated in accordance with the
following formula:

 

 (1)  Such nonbank dealers referred to in this Statement of Terms may
include affiliates of the Dealer.

 

23

 

	
   

  	
  D x 360

  	
   

  	
   

  
	
  Money Market Yield =

  	
   

  	
   

  	
  x 100

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  360 - (D x M)

  	
   

  	
   

  

 

where “D” refers
to the applicable per annum rate for commercial paper quoted on a bank discount
basis and expressed as a decimal and “M” refers to the actual number of days in
the interest period for which interest is being calculated.

 

Federal Funds Rate Notes

 

“Federal
Funds Rate” means the rate on any Interest Determination Date for Federal Funds
as published in Reuters (or any successor service) on page FEDFUNDS1 under the
heading “EFFECT” (or any other page as may replace the specified page on that
service) (“Reuters Page FEDFUNDS1”).

 

If the above rate does not
appear on Reuters Page FEDFUNDS1 or is not so published by 3:00 p.m. on
the Calculation Date, the Federal Funds Rate will be the rate on such Interest
Determination Date as published in H.15 Daily Update under the heading “Federal
Funds/(Effective)”.

 

If such rate is
not published as described above by 3:00 p.m. on the Calculation Date, the
Calculation Agent will determine the Federal Funds Rate to be the arithmetic
mean of the rates for the last transaction in overnight U.S. dollar federal
funds arranged by each of three leading brokers of Federal Funds transactions
in New York City selected by the Calculation Agent prior to 9:00 a.m. on
such Interest Determination Date.

 

If the brokers
selected by the Calculation Agent are not quoting as mentioned above, the
Federal Funds Rate will remain the Federal Funds Rate then in effect on such
Interest Determination Date.

 

LIBOR Notes

 

The London
Interbank offered rate (“LIBOR”) means, with respect to any Interest
Determination Date, the rate for deposits in U.S. dollars having the Index
Maturity that appears on the Designated LIBOR Page as of 11:00 a.m. London
time, on such Interest Determination Date.

 

If no rate
appears, LIBOR will be determined on the basis of the rates at approximately
11:00 a.m., London time, on such Interest Determination Date at which
deposits in U.S. dollars are offered to prime banks in the London interbank
market by four major banks in such market selected by the Calculation Agent for
a term equal to the Index Maturity and in principal amount equal to an amount
that in the Calculation Agent’s judgment is representative for a single
transaction in U.S. dollars in such market at such time (a “Representative
Amount”).  The Calculation Agent will
request the principal London office of each of such banks to provide a
quotation of its rate.  If at least two
such quotations are provided, LIBOR will be the arithmetic mean of such
quotations.  If fewer than two quotations
are provided, LIBOR for such interest period will be the arithmetic mean of the
rates quoted at approximately 11:00 a.m., in New York City, on such
Interest Determination Date by three major banks in New York City, selected by
the Calculation Agent, for loans in U.S. dollars to leading European banks, for
a term equal to the Index Maturity and in a Representative Amount; provided,
however, that if fewer than three banks so selected by the Calculation Agent
are providing such quotations, the then existing LIBOR rate will remain in
effect for such Interest Payment Period.

 

“Designated
LIBOR Page” means Reuters Screen LIBOR01 Page or any replacement page or pages on
which London interbank rates of major banks for the Index Currency are
displayed.

 

24

 

Prime Rate Notes

 

“Prime Rate” means
the rate on any Interest Determination Date as published in H.15(519) under the
heading “Bank Prime Loan”.

 

If the above rate
is not published in H.15(519) prior to 3:00 p.m. on the Calculation Date,
then the Prime Rate will be the rate on such Interest Determination Date as
published in H.15 Daily Update opposite the caption “Bank Prime Loan”.

 

If the rate is not
published prior to 3:00 p.m. on the Calculation Date in either H.15(519)
or H.15 Daily Update, then the Calculation Agent will determine the Prime Rate
to be the arithmetic mean of the rates of interest publicly announced by each
bank that appears on the Reuters Screen US PRIME1 Page (as defined below) as
such bank’s prime rate or base lending rate as of 11:00 a.m. on that
Interest Determination Date.

 

If fewer than four
such rates referred to above are so published by 3:00 p.m. on the
Calculation Date, the Calculation Agent will determine the Prime Rate to be the
arithmetic mean of the prime rates or base lending rates quoted on the basis of
the actual number of days in the year divided by 360 as of the close of
business on such Interest Determination Date by three major banks in New York
City selected by the Calculation Agent.

 

If the banks
selected are not quoting as mentioned above, the Prime Rate will remain the
Prime Rate in effect on such Interest Determination Date.

 

“Reuters Screen US Prime1
Page” means the display designated as page “USPrime1” of the Reuters Service,
or any successor service, or any replacement page or pages on that service, for
the purpose of displaying prime rates or base lending rates of major U.S.
banks.

 

Treasury Rate Notes

 

“Treasury Rate” means:

 

(1) the
rate from the auction held on the Interest Determination Date (the “Auction”)
of direct obligations of the United States (“Treasury Bills”) having the Index
Maturity specified in the applicable pricing supplement above under the caption
“INVESTMENT RATE”, as that rate appears on Reuters Screen USAUCTION10 or
USAUCTION11 Page under the heading “Investment Rate” (or any other page as may
replace the specified page on that service or a successor service).

 

 (2) if the rate referred to in clause (1) is
not so published by 3:00 p.m. on the related Calculation Date, the Bond
Equivalent Yield (as defined below) of the rate for the applicable Treasury
Bills as published in H.15 Daily Update, under the caption “U.S. Government
Securities/Treasury Bills/Auction High”, or

 

(3) if the rate referred to in clause (2) is
not so published by 3:00 p.m. on the related Calculation Date, the Bond
Equivalent Yield of the auction rate of the applicable Treasury Bills as
announced by the United States Department  of the Treasury, or

 

(4) if the
rate referred to in clause (3) is not so announced by the United States
Department of the Treasury, or if the Auction is not held, the Bond Equivalent
Yield of the rate on the particular Interest Determination Date of the
applicable Treasury Bills as published in H.15(519) under the caption “U.S.
Government Securities/Treasury Bills/Secondary Market”, or

 

25

 

(5) if the
rate referred to in clause (4) not so published by 3:00 p.m. on the
related Calculation Date, the rate on the particular Interest Determination
Date of the applicable Treasury Bills as published in H.15 Daily Update, under
the caption “U.S. Government Securities/Treasury Bills/Secondary Market”, or

 

(6) if the
rate referred to in clause (5) is not so published by 3:00 p.m. on
the related Calculation Date, the rate on the particular Interest Determination
Date calculated by the Calculation Agent as the Bond Equivalent Yield of the
arithmetic mean of the secondary market bid rates, as of approximately 3:30 p.m.
on that Interest Determination Date, of three primary United States government
securities dealers selected by the Calculation Agent for the issue of Treasury
Bills with a remaining maturity closest to the Index Maturity specified in the
Supplement, or

 

(7) if the
dealers so selected by the Calculation Agent are not quoting as mentioned in
clause (6), the Treasury Rate in effect on the particular Interest
Determination Date.

 

“Bond Equivalent Yield” means a yield (expressed as a percentage)
calculated in accordance with the following formula:

 

	
   

  	
  D x N

  	
   

  	
   

  
	
  Bond Equivalent Yield =

  	
   

  	
   

  	
  x 100

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  360 - (D x M)

  	
   

  	
   

  

 

where “D” refers to the applicable per annum rate for Treasury Bills
quoted on a bank discount basis and expressed as a decimal, “N” refers to 365
or 366, as the case may be, and “M” refers to the actual number of days in the
applicable Interest Reset Period.

 

3.               Final Maturity.  The Stated
Maturity Date for any Note will be the date so specified in the Supplement,
which shall be no later than 397 days from the date of issuance.  On its Stated Maturity Date, or any date
prior to the Stated Maturity Date on which the particular Note becomes due and
payable by the declaration of acceleration, each such date being referred to as
a Maturity Date, the principal amount of each Note, together with accrued and
unpaid interest thereon, will be immediately due and payable.

 

4.               Events of Default. 
The occurrence of any of the following shall constitute an “Event of
Default” with respect to a Note:  (i) default
in any payment of principal of or interest on such Note (including on a
redemption thereof); (ii) the Issuer or any Guarantor makes any compromise
arrangement with its creditors generally including the entering into any form
of moratorium with its creditors generally; (iii) a court having
jurisdiction shall enter a decree or order for relief in respect of the Issuer
or any Guarantor in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or there shall be
appointed a receiver, administrator, liquidator, custodian, trustee or
sequestrator (or similar officer) with respect to the whole or substantially
the whole of the assets of the Issuer or such Guarantor and any such decree,
order or appointment is not removed, discharged or withdrawn within 60 days
thereafter; or (iv) the Issuer or any Guarantor shall commence a voluntary
case under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the appointment of or taking
possession by a receiver, administrator, liquidator, assignee, custodian,
trustee or sequestrator (or similar official), with respect to the whole or
substantially the whole of the assets 

 

26

 

of the Issuer or any Guarantor or make any general assignment for the
benefit of creditors.  Upon the
occurrence of an Event of Default, the principal of each obligation evidenced
by such Note (together with interest accrued and unpaid thereon) shall become,
without any notice or demand, immediately due and payable.(2)

 

5.               Obligation Absolute. 
No provision of the Issuing and Paying Agency Agreement under which the
Notes are issued shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on each Note
at the times, place and rate, and in the coin or currency, herein prescribed.

 

6.               Supplement.  Any term
contained in the Supplement shall supercede any conflicting term contained
herein.

 

 (2)         Unlike
single payment notes, where a default arises only at the stated maturity,
interest-bearing notes with multiple payment dates should contain a default
provision permitting acceleration of the maturity if the Issuer defaults on an
interest payment.

 

27

 

Exhibit D

 

Form of Guarantee

 

GUARANTEE

 

GUARANTEE, dated as of August 6, 2008, of STAPLES
THE OFFICE SUPERSTORE, LLC, a Delaware limited liability company, STAPLES THE
OFFICE SUPERSTORE EAST, INC., a Delaware corporation, STAPLES CONTRACT AND
COMMERCIAL, INC., a Delaware corporation, and STAPLES THE OFFICE SUPERSTORE,
LIMITED PARTNERSHIP, a Massachusetts limited partnership (each a “Guarantor”
and collectively, the “Guarantors”).

 

The Guarantors, for value received, hereby jointly and
severally agree as follows for the benefit of the holders from time to time of
the Notes hereinafter described:

 

1.                                       Each Guarantor irrevocably guarantees
payment in full, as and when the same becomes due and payable, of the principal
of and interest, if any, on the promissory notes (the “Notes”) issued by
Staples, Inc., a Delaware corporation (the “Issuer”), from time to time
pursuant to the Issuing and Paying Agent Agreement, dated as of June 9,
2008, as the same may be amended, supplemented or modified from time to time,
between the Issuer and LaSalle Bank (the “Agreement”).

 

2.                                       Each Guarantor’s obligations under this
Guarantee shall be unconditional, irrespective of the validity or
enforceability of any provision of the Agreement or the Notes.

 

3.                                       This Guarantee is a guaranty of the due
and punctual payment (and not merely of collection) of the principal of and
interest, if any, on the Notes by the Issuer and shall remain in full force and
effect until all amounts have been validly, finally and irrevocably paid in
full, and shall not be affected in any way by any circumstance or condition
whatsoever, including without limitation (a) the absence of any action to
obtain such amounts from the Issuer, (b) any variation, extension, waiver,
compromise or release of any or all of the obligations of the Issuer under the
Agreement of the Notes or of any collateral security therefore or (c) any
change in the existence or structure of, or the bankruptcy or insolvency of,
the Issuer or by any other circumstance (other than by complete, irrevocable
payment) that might otherwise constitute a legal or equitable discharge or
defense of a guarantor or surety.  Each
Guarantor waives all requirements as to diligence, presentment, demand for
payment, protest and notice of any kind with respect to the Agreement and the
Notes.

 

4.                                       In the event of a default in payment of
principal of or interest on any Notes, the holders of such Notes, may institute
legal proceedings directly against each Guarantor to enforce this Guarantee
without first proceeding against the Issuer.

 

5.                                       This Guarantee shall remain in full force
and effect or shall be reinstated (as the case may be) if at any time any
payment by the Issuer of the principal of or interest, if any, on the Notes, in
whole or in part, is rescinded or must otherwise 

 

28

 

be returned by the holder upon the insolvency,
bankruptcy or reorganization of the Issuer or otherwise, all as though such
payment had not been made.

 

6.                                       This Guarantee shall be permanently
released as to any Guarantor party hereto if (a) such Guarantor is not a
guarantor of the Issuer’s publicly issued notes or bonds outstanding from time
to time or any such guarantee of the Issuer’s publicly issued notes or bonds is
subject to release concurrently with the release of this Guarantee, and (b) 
if there are no amounts that are both unpaid and overdue under the Notes or
Guarantee and there is no continuing Event of Default (as defined in the
Amended and Restated Commercial Paper Dealer Agreement, dated as of August 6,
2008, between the Issuer and Lehman Brothers Inc.) on the date of such
release.  Such release shall be immediate
and automatic without any requirement of any notice to or acknowledgment by any
holder of the Notes.

 

7.                                       This Guarantee shall be governed by and
construed in accordance with the laws of the State of New York.

 

[Remainder of Page Intentionally Blank]

 

29

 

IN WITNESS WHEREOF, each Guarantor has caused this Guarantee to be duly
executed as of the day and year first above written.

 

	
   

  	
  STAPLES
  THE OFFICE SUPERSTORE, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Nicholas
  Hotchkin

  
	
   

  	
   

  	
  Title:

  	
  Senior
  Vice President, Finance and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  STAPLES
  THE OFFICE SUPERSTORE EAST, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Nicholas
  Hotchkin

  
	
   

  	
   

  	
  Title:

  	
  Senior
  Vice President, Finance and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  STAPLES
  CONTRACT AND COMMERCIAL, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Nicholas
  Hotchkin

  
	
   

  	
   

  	
  Title:

  	
  Senior
  Vice President, Finance and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  STAPLES
  THE OFFICE SUPERSTORE, LIMITED

  PARTNERSHIP

  
	
   

  	
   

  
	
   

  	
  By
  its General Partner: 
  Staples, Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Nicholas
  Hotchkin

  
	
   

  	
   

  	
  Title:

  	
  Senior
  Vice President, Finance and Treasurer

  

 

30Exhibit 4(i).2

 

ARTICLE IV

 

4.01    The aggregate number of shares
which the Corporation shall have the authority to issue is 100,000,000 shares
of Common Stock, no par value, 5,000,000 shares of Preferred Stock Class A
with a par value of One Dollar ($1.00) per share and 5,000,000 shares of
Preferred Stock Class B with a par value of One Dollar ($1.00) per share. 

 

4.02    The Corporation is authorized
to issue three classes of stock, one designated as Common Stock, no par value,
one designated as Preferred Stock Class A, par value One Dollar ($1.00)
per share, and one designated as Preferred Stock Class B, par value One
Dollar ($1.00) per share, each as described in this Article IV above.
Provided, however, that none of the shares of Preferred Stock of either class
shall carry any voting rights for the election of Directors or for any other
matters, except where specifically designated or required by the applicable
provisions of the Texas Business Corporation Act. 

 

ARTICLE VI

 

Cumulative
voting is expressly prohibited.

 

ARTICLE X

 

Corporate Governance

 

a)        Number, Election, and Terms of Directors. The business and
affairs of the Corporation shall be managed by a Board of Directors, which,
subject to the rights of holders of shares of any class of series of Preferred
Stock of the Corporation then outstanding to elect additional directors under
specified circumstances, shall consist of not less than three nor more than
twenty-one persons. The exact number of directors within the minimum and
maximum limitations specified in the preceding sentence shall be fixed from
time to time by either (i) the Board of Directors pursuant to a resolution
adopted by the majority of the entire Board of Directors, or (ii) the
affirmative vote of the holders of 66-2/3% or more of the voting power of all
of the shares of the Corporation entitled to vote generally in the election of
directors voting together as a single class. No decrease in the number of
directors constituting the Board of Directors shall shorten the term of any
incumbent director; provided, however, that the term of existing Directors may
be shortened to comply with this Article X and/or the Texas Business
Corporation Act. The directors shall be divided into two classes as nearly
equal in number as possible, with the term of office of the first class to
expire at the 2001 annual meeting of stockholders, and the term of office of
the second class to expire at the 2002 annual meeting of stockholders, and with
the members of each class to hold office until their successors shall have been
elected and qualified. At each annual meeting of stockholders following such
initial classification and election, directors elected to succeed those
directors shall be elected for a term of office to expire at the second
succeeding annual meeting of stockholders after their election. 

 

b)        Newly Created Directorships and Vacancies. Vacancies of
generally elected directors may be filled by a majority vote of the remaining
generally elected directors, though less than a quorum, or by a sole remaining
generally elected director. Vacancies of directors elected pursuant to a
dividend default election by preferred shareholders shall be filled by the
remaining directors so elected or by a sole remaining director elected by such
shareholders, if any. In the event that no directors elected pursuant to a
dividend default election remain, the vacancy may be filled by a vote of those
shareholders that originally elected the director whose office is vacant. 

 

c)        Removal. Any director, or the entire Board of Directors, may
be removed from office at any annual or special meeting called for such
purpose, and then only for cause and only by the affirmative vote of the
holders of 66-2/3% or more of the voting power of all of the shares of the
Corporation entitled to vote in the election of such director(s) being 

 

 

removed. As used herein, cause shall mean only the
following: proof that a director has been convicted of a felony, committed a
grossly negligent or willful misconduct resulting in a material detriment to
the Corporation, or committed a material breach of his or her fiduciary duty to
the Corporation resulting in a material detriment to the Corporation.

 

d)        Amendment, Repeal, etc. Notwithstanding anything contained
in these Articles of Incorporation to the contrary and subject to the rights of
the holders of any Preferred Stock outstanding, the affirmative vote of the
holders of 66- 2/3% or more of the voting power of all
of the shares of the Corporation entitled to vote in the election of Directors,
voting together as a single class, shall be required to alter, amend, or adopt
any provision inconsistent with or repeal this Article X or to alter,
amend, adopt any provision inconsistent with or repeal comparable sections of
the Amended and Restated Bylaws of the Corporation. 

 

e)        Call of Special Meeting to Alter Article X.
Notwithstanding anything contained in these Articles of Incorporation to the
contrary, the affirmative vote of the holders of 66- 2/3%
or more of the voting power of all of the shares of the Corporation entitled to
vote generally in the election of directors, voting together as a single class,
shall be required to call a special meeting of the shareholders in order to
alter, amend, adopt any provision inconsistent with or repeal this Article X,
or to alter, amend, or adopt any provision inconsistent with comparable
sections of the Amended and Restated Bylaws. 

 

ARTICLE XII

 

No
holder of any shares of the Corporation shall have any preemptive right to
subscribe or acquire any additional, unissued or treasury shares of the
Corporation or any securities of the Corporation which are convertible into or
which carry a right to subscribe for or acquire shares of the Corporation.

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